Accounting For Managers Assignment-2

Submitted by- Gagandeep Singh Mba-ib Section c

QUES 1: List down the industries wise companies which are listed in B.S.E [30] and N.S.E [50].

SOLUTION 1:

Name

Industry Cur Chan Prev.Cl Op r ge ose en Pric (%) e

ACC Ltd Bharat Heavy Electricals Ltd Bharti Airtel Ltd Cipla Ltd DLF Ltd HDFC Bank Ltd Hero MotoCorp Ltd Hindalco Industries Ltd Hindustan Unilever Ltd Housing Developmen t Finance Corporation Ltd 997 1716 -0.28 1.95 999.75 1683.25 1000 1685

Mkt Cap( Rs cr)

18769. 3 82398. 5

1) ACC 2) BHEL

3) BHARTIART L 4) CIPLA 5) DLF 6) HDFCBANK 7) HEROHOND A 8) HINDALCO 9) HINDUNILV R 10) HDFC

388 290.0 5 187.2 459.6 5 2006. 3 136.8 314 643

1.17 1.86 0.16 -0.50 0.63 -1.79 -0.33 0.66

383.5 284.75 186.9 461.95 1993.65 139.3 315.05 638.8

383.5 14563 5 284.2 22862. 6 189 31728. 1 461 10790 0 1993. 39813. 7 2 140.2 26669 5 313.1 69752. 1 640.8 93932. 4

11) ICICIB ANK 12) INFOS YSTCH 13) ITC 14) JPASS OCIAT 15) JINDAL STEL 16) LT 17) 18) TI 19) 20) 21) M&M MARU NTPC ONGC RCOM

ICICI Bank Ltd Infosys Ltd ITC Ltd Jaiprakash Associates Ltd Jindal Steel & Power Ltd Larsen & Toubro Ltd Mahindra & Mahindra Ltd Maruti Suzuki India Ltd NTPC Ltd Oil & Natural Gas Corpn Ltd Reliance Communicat ions Ltd Reliance Industries Ltd Reliance Infrastructur e Ltd State Bank of India Sterlite Industries (India) Ltd Tata Consultancy Services Ltd Tata Motors Ltd Tata Power Company Ltd

836.1 2236. 05 198.5 61.1 493.8 1545 709.6 1162. 65 172.4 276.5 76.05 727.4 438.5 5 2061. 5 124.6 918.7 714 1052. 1

0.35 0.48 -0.18 2.69 1.80 0.00 -1.32 0.02 -0.78 0.27 2.84 -0.52 2.77 1.06 -0.60 -1.19 0.08 -0.06

833.15 2225.4 198.85 59.5 485.05 1544.95 719.1 1162.45 173.75 275.75 73.95 731.2 426.75 2039.9 125.35 929.8 713.4 1052.75

836.5 5 2217. 9 198.9 60 486

95996. 4 12777 8 15413 5 12652. 4

45327. 9 1551. 94419. 3 6 719.1 44151. 3 1163 33585. 5 174 14326 5 276.7 23591 7 74.9 15263. 4

22) RELIA NCE 23) RELIN FRA 24) 25) 26) SBIN STER TCS

731.2 23941 5 430 11324. 7

2046. 12953 7 2 125.4 42137. 7 929 18198 0

27) TATAM OTORS 28) TATAP OWER

717.9 45276. 6 1052 24982. 8

29) TATAS TEEL 30) WIPRO

Tata Steel Ltd Wipro Ltd

460.6 5 319

0.32 -0.47

459.2 320.5

463.7 44046. 5 9 320 78740. 4

Top 50 NSE companies Company Industry Name

ACC Ltd. Ambuja Cements Ltd. Axis Bank Ltd. Bajaj Auto Ltd. Bharat Heavy Electricals Ltd. Bharat Petroleum Corporation Ltd. CEMENT AND CEMENT PRODUCTS CEMENT AND CEMENT PRODUCTS BANKS AUTOMOBILES - 2 AND 3 WHEELERS ELECTRICAL EQUIPMENT REFINERIES

Symbol
ACC AMBUJACEM AXISBANK BAJAJ-AUTO BHEL

Series
EQ EQ EQ EQ EQ

ISIN Code
INE012A010 25 INE079A010 24 INE238A010 26 INE917I0101 0 INE257A010 18 INE029A010 11

BPCL

EQ

Bharti Airtel Ltd. Cairn India Ltd. Cipla Ltd. DLF Ltd. Dr. Reddy's Laboratorie s Ltd. GAIL (India) Ltd. Grasim Industries Ltd. HCL Technologie s Ltd. HDFC Bank Ltd. Hero MotoCorp Ltd. Hindalco Industries Ltd. Hindustan Unilever Ltd. Housing Developme nt Finance Corporation Ltd. I T C Ltd. ICICI Bank Ltd. Infosys Ltd. Infrastructu re Developme

TELECOMMUNICATION BHARTIARTL SERVICES OIL CAIRN EXPLORATION/PRODUC TION PHARMACEUTICALS CIPLA CONSTRUCTION PHARMACEUTICALS GAS TEXTILES - SYNTHETIC COMPUTERS SOFTWARE BANKS AUTOMOBILES - 2 AND 3 WHEELERS ALUMINIUM DIVERSIFIED FINANCE - HOUSING DLF DRREDDY GAIL GRASIM HCLTECH HDFCBANK HEROMOTOC O HINDALCO HINDUNILVR HDFC

EQ EQ EQ EQ EQ EQ EQ EQ EQ EQ EQ EQ EQ

INE397D010 24 INE910H010 17 INE059A010 26 INE271C010 23 INE089A010 23 INE129A010 19 INE047A010 13 INE860A010 27 INE040A010 26 INE158A010 26 INE038A010 20 INE030A010 27 INE001A010 36

CIGARETTES BANKS COMPUTERS SOFTWARE FINANCIAL INSTITUTION

ITC ICICIBANK INFY IDFC

EQ EQ EQ EQ

INE154A010 25 INE090A010 13 INE009A010 21 INE043D010 16

nt Finance Co. Ltd. Jaiprakash Associates Ltd. Jindal Steel & Power Ltd. Kotak Mahindra Bank Ltd. Larsen & Toubro Ltd. Mahindra & Mahindra Ltd. Maruti Suzuki India Ltd. NTPC Ltd. Oil & Natural Gas Corporation Ltd. Power Grid Corporation of India Ltd. Punjab National Bank Ranbaxy Laboratorie s Ltd. Reliance Capital Ltd. Reliance Communica tions Ltd. Reliance Industries Ltd. Reliance Infrastructu re Ltd.

CONSTRUCTION STEEL AND STEEL PRODUCTS BANKS ENGINEERING AUTOMOBILES - 4 WHEELERS AUTOMOBILES - 4 WHEELERS POWER

JPASSOCIAT JINDALSTEL KOTAKBANK LT M&M MARUTI NTPC

EQ EQ EQ EQ EQ EQ EQ EQ

INE455F0102 5 INE749A010 30 INE237A010 28 INE018A010 30 INE101A010 26 INE585B010 10 INE733E010 10 INE213A010 29 INE752E010 10 INE160A010 14 INE015A010 28 INE013A010 15 INE330H010 18 INE002A010 18 INE036A010 16

OIL ONGC EXPLORATION/PRODUC TION POWER BANKS PHARMACEUTICALS FINANCE TELECOMMUNICATION SERVICES REFINERIES POWER POWERGRID PNB RANBAXY RELCAPITAL RCOM RELIANCE RELINFRA

EQ EQ EQ EQ EQ EQ EQ

Reliance Power Ltd. Sesa Goa Ltd. Siemens Ltd. State Bank of India Steel Authority of India Ltd. Sterlite Industries (India) Ltd. Sun Pharmaceut ical Industries Ltd. Tata Consultancy Services Ltd. Tata Motors Ltd. Tata Power Co. Ltd. Tata Steel Ltd. Wipro Ltd.

POWER MINING ELECTRICAL EQUIPMENT BANKS STEEL AND STEEL PRODUCTS METALS PHARMACEUTICALS

RPOWER SESAGOA SIEMENS SBIN SAIL STER SUNPHARMA

EQ EQ EQ EQ EQ EQ EQ

INE614G010 33 INE205A010 25 INE003A010 24 INE062A010 12 INE114A010 11 INE268A010 49 INE044A010 36

COMPUTERS SOFTWARE AUTOMOBILES - 4 WHEELERS POWER STEEL AND STEEL PRODUCTS COMPUTERS SOFTWARE

TCS

EQ

INE467B010 29 INE155A010 14 INE245A010 13 INE081A010 12 INE075A010 22

TATAMOTOR S TATAPOWER TATASTEEL WIPRO

EQ EQ EQ EQ

Ques 2: Annual Report of Reliance Industries for the year 2010-2011 and there profit or loss analysis. SOLUTION 2:
Directors Report Year End : Mar '11

The Directors are pleased to present the 37th Annual Report and the audited accounts for the financial year ended March 31, 2011. Financial Results The financial performance of the Company, for the year ended March 31, 2011 is summarised below: 2010-2011 Rs. crore $ Mn* Profit before Depreciation, Interest & Tax Less: Interest Depreciation Less: 16,241.33 41,177.44 2,327.62 9,234 522 33,041.18 1,997.21 13,477.01 7,359 445 2009-2010 Rs. crore $ Mn*

Transfer from 2,633.75 13,607.58 25,242.24 3,051 2,980.48 10,496.53 2,338 5,661 20,547.44 4,576

Revaluation Reserve Profit before Tax Less: Provision for Current Taxation Provision for Deferred Tax Profit after Tax Add: Balance in Profit and Loss Account Amount Available for Appropriation Appropriation: General Reserve

4,320.44 635.50 20,286.30

969 143 4,549

3,111.77 1,200.00

693 267

16,235.67 3,616

4,999.45 25,285.75

1,114 5,663

5,384.19 1,199 21,619.86 4,815

16,000.00 2,384.99 386.90 6,513.86 25,285.75

3,588 535 87 1,453 5,663

14,000.00 3,118 189.50 2,084.67 346.24 42 464 77

Debenture Redemption Reserve Dividend on Equity Shares Tax on Dividend Balance carried to Balance Sheet

4,999.45 1,114 21,619.86 4,815

* 1 $ = Rs. 44.595 Exchange Rate as on March 31, 2011 (1 $ = Rs. 44.90

COMMENTS
Reliance Industries came out with its Q1 numbers today. Sales touched Rs 81,018 crore, that's a jump of 39% year-on-year. Profits came in at Rs 5,660 crore. The company said Q1 profit was driven by strong refining margins. The numbers were in-line with street estimates. CNBC-TV18 had expected top-line at Rs 78,200 crore and bottom-line at Rs 5,625 crore. RIL's gross refining margin (GRM) for quarter was at USD 10.3 per barrel as against USD 7.3 per barrel in the corresponding period of the previous year. Singapore complex refining margin averaged at USD 8.5 per barrel for 1Q FY12 which is double of the level in 1Q FY11. During the quarter ended 30th June 2011, revenue for the petchem business increased by 32.1% from Rs 13,903 crore to Rs 18,366 crore (USD 4.1 billion). Increase in volume accounted for 6.5% growth in revenue and higher prices accounted for 25.6% growth in revenue. Ambareesh Baliga, COO of Way2Wealth said, the profits are slightly better than what most of the experts were expecting. However, he said, the petchem margins are surely lower than his expectations. Baliga further said, in Q2, petchem margins would actually play a bigger role. Along with that, if in case their gas production also stagnates then surely you will have the Q2 results worse than what you have seen now. SP Tulsian, sptulsian.com said, there has been pressure on the polyester segment because of the steep fall in the cotton prices. The polyester prices move in line with the cotton prices. Since we have seen a fall of as high as 30-35% in the cotton prices, Reliance has been struggling to hold that kind of margin. There has been a fall more than what was expected for this segment. Deven Choksey, CEO of KR Choksey expects petchem to stabilise in this particular quarter. The margin, to a certain extent, has surprised me. In the first quarter, the hit has come on the petchem more because of volatile crude. I think you should be seeing some amount of stability back into this particular quarter. The premise is that crude oil prices have not remained as volatile as they have remained in the last quarter. So, in second quarter, I think the Petchem should be slightly higher.

Rahul Singh, head - equity research of StanChart Securities said, RIL could face some pressure, especially on the polyester side with cotton prices coming off. But the demand, he said, continues to be strong. Petrochem for Reliance always remains very difficult to predict because it is not one product or one segment, but there are various segments. We have built a flattish kind of petrochem margins outlook for FY12 and FY13. We do not assume too much of dramatic movements one way or the other over the next 18 months.

Ques 3: What are the methods used to analyze the financial statements of a company. What are the key important indicators should be seen to analyze a companies performance over the years. After listing down the companies of B.S.E and N.S.E ,which companies as an investor you would like to invest and why? Solution:

Introduction Financial statement information is used by both external and internal users, including investors, creditors, managers, and executives. These users must analyze the information in order to make business decisions, so understanding financial statements is of great importance. Several methods of performing financial statement analysis exist. This article discusses two of these methods: horizontal analysis and vertical analysis.

1) Horizontal Analysis Methods of financial statement analysis generally involve comparing certain information. The horizontal analysis compares specific items over a number of accounting periods. For example, accounts payable may be compared over a period of months within a fiscal year, or revenue may be compared over a

period of several years. These comparisons are performed in one of two different ways.

Absolute Dollars One method of performing a horizontal financial statement analysis compares the absolute dollar amounts of certain items over a period of time. For example, this method would compare the actual dollar amount of operating expenses over a period of several accounting periods. This method is valuable when trying to determine whether a company is conservative or excessive in spending on certain items. This method also aids in determining the effects of outside influences on the company, such as increasing gas prices or a reduction in the cost of materials. Percentage The other method of performing horizontal financial statement analysis compares the percentage difference in certain items over a period of time. The dollar amount of the change is converted to a percentage change. For example, a change in operating expenses from $1,000 in period one to $1,050 in period two would be reported as a 5% increase. This method is particularly useful when comparing small companies to large companies.

2) Vertical Analysis The vertical analysis compares each separate figure to one specific figure in the financial statement. The comparison is reported as a percentage. This method compares several items to one certain item in the same accounting period. Users often expand upon vertical analysis by comparing the analyses of several periods to one another. This can reveal trends that may be helpful in decision making. An explanation of Vertical analysis of the income statement and vertical analysis of the balance sheet follows.

Income Statement Performing vertical analysis of the income statement involves comparing each income statement item to sales. Each item is then reported as a percentage of sales. For example, if sales equals $10,000 and operating expenses equals $1,000, then operating expenses would be reported as 10% of sales.

Balance Sheet Performing vertical analysis of the balance sheet involves comparing each balance sheet item to total assets. Each item is then reported as a percentage of total assets. For example, if cash equals $5,000 and total assets equals $25,000, then cash would be reported as 20% of total assets.

Company I would invest in would be reliance communications because Reliance Communications is looking good. The stock can give 5-7% return in future. The company's trailing 12-month (TTM) EPS was at Rs -2.61 per share. (Jun, 2011). The stock's price-to-earnings (P/E) ratio was -. The latest book value of the company is Rs 240.99 per share. At current value, the price-to-book value of the company was 0.33. The dividend yield of the company was 1.08%