A Study on Financial Performance Using Ratio Analysis at Emami Ltd

Secondary information is collected for this case. This case study limited only one techniques of financial analysis that is Ratio Analysis and also taken a single company. Thus the conclusion of the analysis carried out in a professional manner will be able to correctly describe the evaluation of the company and to substantiate the user’s decisions.

Research papers have educated that there are multiples of variables, which contribute into play varying degree of influence on the profitability of the organization. Therefore it is desirable for financial managers to gauge the prime variables exerting substantial influence on the profitability. Following two papers were referred to carry out this project, “An example of the use of financial ratio analysis: the case of Motorola” by H. W. Collier(2007), University of Wollongong.In this paper, they have demonstrated the use of actual financial data for financial ratio analysis. The objective is to show how to compute ratios for an actual company. This paper demonstrates the difficulties in applying the principles of financial ratio analysis when the data are not homogenous as is the case in textbook examples. Therefore in this paper, financial ratio analysis is complicated for companies that do not readily fall into a single industry. Motorola has 6 operating units that fall into several industries with two industries accounting for most of the sales- telecommunication and semi-conductor. However, a more relevant picture of the operating characteristics of Motorola is achieved by increasing the complexity of the analysis, that is, by comparing Motorola to both industries.“Financial ratio analysis as a determinant of profitability in Nigerian Pharmaceutical

The following report is a brief comparative analysis of two of Australia’s largest deposit-taking financial institutions (FI), Australia and New Zealand Banking Group Ltd. (ANZ) and Westpac Banking Corporation (Westpac). This report seeks to identify which of the FIs has a greater aggregate return per dollar of equity and thus establish the highest performer, or most profitable, of the two. The Return on Equity Model (ROE) (Koch & MacDonald,

Ratio analysis is a tool brought by individuals used to evaluate analysis of information in the financial statements of a business. The ratio analysis forms an essential part of the financial analysis which is a vital part in the business planning. There are 3 different ways of assessing businesses performance and these are: solvency, profitability and performance. Ratio analysis assists managers to work out the production of the company by figuring the profitability ratios. Also, the management can evaluate their revenues to check if their productivity. Thus, probability ratios are helpful to the company in evaluating its performance based on current earning. By measuring the solvency ratio, the companies are able to keep an

There is a essential use and limitations of financial ratio analysis, One must keep in mind the following issues when using financial ratios: One of the most important reasons for using financial ratio analysis is comparability and for this, a reference point is required. Usually, financial ratios are compared to historical ratios of the business itself, competitor’s financial ratios or the overall ratios of the industry in question. Performance may be adjudged as against organizational goals or forecasts. A number of ratios must be analyzed together to get a true and reliable picture of the financial performance of the business. Relying on each ratio

Mafraq, J 2013, ‘The Role of Financial Analysis Ratio in Evaluating Performance’, Interdciplinary Journal of Contemporary Research in Business, vol. 5, no. 2, pp. 13-28.

The paper illustrates that financial ratio analysis is an important tool for firm’s to evaluate their financial health in order to identify areas of weakness so as to institute corrective measures.

1.Suggest the financial ratio that most financial analysts would use to evaluate the financial condition of the company. Provide support for your rationale.

Beds in services in this hospital are same for last three years but the standard benchmark which is 121 is

A brief description of financial ratios that is used by most financial analysts are used to evaluate the financial infrastructure of applying to Central (BMC), also will provide an overview that will cover the organization’s ability to meet their financial obligations. According to the company balance sheet (see Appendix A.) the discussions on the profitability trends that may be favorable, or unfavorable are based on the ratio analysis. The financial ratio analysis is the methods used, which businesses can make predictions based on the future performance of the company. According to the

Before beginning an analysis of a company it is necessary to have a complete set of financial statements, preferably for the pas few years so that historical trends can be obtained. Ratios are a way for anyone to get an idea of the financial performance of a company by using the information contained in the financial statements. Ratios are grouped into four basic categories, liquidity, activity, profitability, and financial leverage. This document will use a variety of these ratios to analyze the firm, Sample Company, as of December 31,2000.

Ratio analysis is the fundamental indicator of company’s performances for so many years; it is also can be seen as the very first step to measure a company’s performance along with its financial position. Moreover, ratio analysis has been researched and developed for many years, Bliss had presented the first coherent system of ratios, and he also stated that ratios are “indicator of the status of fundamental relationship within the business” Horrigan (1968). However there are some arguments on whether the ratio analysis is useful or not since to conduct these analyses will be costly to the company, also there are several limitations on how these ratios work. Therefore, the usefulness and the limitation of ratio analysis will be discussed further in this essay, with the use of easyJet’s annual report as examples.

Ratio Analysis is a powerful tool of financial analysis. The absolute figures that are reported in the financial statements do not provide an understanding of the financial well-being of the firm. Ratios help in creating a qualitative judgement about the financial position of the company by making use of quantitative relationships. The standards of comparison of the ratios involve comparing them with:

Ratio analysis is the best way of analysing the company’s financial wealth and position. It helps to understand the crucial financial figures of an entity pointing to weak and possibly risky parts of its finance. Using the results of the analysis managers can strengthen the financial position by determining and eliminating possible risks related to credits, operations and market fluctuations.

The Study of the ratio analysis technique to financial statements offers potential in expanding insight into specific strengths and weaknesses of a company financial situation. The primary objective of financial analysis is to provide information useful for decision making.