CIPLA

2011

2010 AVG.

GLENMARK
2011

Sales
COGS
Purchases
Inventory
A/R
A/P
Mrk sec
Cash
Current Asset
Quick Cash
Current liab
Fixed Asset
tangible asset
Intangible asset
Proj. Exp.
SG&A Exp
total asset
Total Debt
Shareholders equity
Equity
Interest
Depreciation
EBIT
Cap Ex.
Gross profit
Operating Profit
Net income

6433.88
2860.43
2489.85
1883.16
1497.04
2010
223.12
84.13
4956.61
1804.29
1370.71
3121.09
3096.04
25.05
5048.5
2188.06
8424.94
441.39
160.58
6612.95
5.14
228.86
1156.53
1286.63
3573.45
1385.38
960.39

5713.82
2452.98

3260.84
1418.77
1081.49

1153.55
391.41
398.02
157
189.34
134.4
0
30.95
2069.24
220.29
205.49
263.72
310.57
51.48
485.72
428.8
3384.33
1146.25
27.02
1979.7
36.08
20.99
286.89
94
762.14
667.83
183.4

CFO
Net profit before tax
Total capital

987.49
1151.39
7054.34

1041.68
1324.99
5919.16

421.06
250.81
3125.95

1512.58 1697.87
1552.71 1524.875
805.21 1407.605
189.2
60.84
4597.54
998.25
2695.41
2683.41
12
4295.05
1842.07
7312.62
5.07
160.58
5914.09
22.85
165.25
1252.84

2908.25

7868.78

6486.75

GLENMARK
2010 AVG.
983.03
326.39

Listing Date:Cipla

150.39
330.09
79.18

153.695
259.715
106.79

5.07
1536.68
191.04
237.29 250.505
257.08
52.12
493.37
447.32
2776.56 3080.445
759.75
26.98
1742.8
30.15
21.27
151.16
656.64
489.66
96.26
983.16
121.01
2502.55

2814.25

5/4/1995

Exhibit 1a
Activity Analysis
Inventory turnover
No. of Days
Accounts Receivables Turnover
No. of Days
Payables Turnover
No. of Days
Fixed Assets Turnover
Total Assets Turnover

Liquidity Analysis
Average no. of days inventory in stock
(Plus)Days of receivables outstanding
Length of operating cycle
(minus) Payables outstanding
Length of cash cycle
Current Ratio
Quick Ratio
Cash Ratio
Cash from operations ratio
Defensic interval no. of days

Numerator
COGS
365 days
Total Revenue
Purchases
Total Revenue
Total revenue

Denominator
Avg Inventory
Inventory Turnover
Avg Receivables
365 A/R Turnover
Avg. payables
365 A/P Turnover
Avg Fixed Assets
Avg Total Assets

We have already done in Exhibit 1

We have already done in Exhibit 1
365 Accounts Payables Turnover*
Current Assets
cash+MS+A/R
cash+MS
CFO

Current Liabilities
Current Liabilities
Current Liabilities
Current Liabilities
365 Projected Exp**/(Cash+MS+AR)

Solvency Analysis.
Debt to Equity
Debt to Capital
Debt (including trade) to Equity
Debt (including trade) to Capital
Times interest earned
Capital expenditure ratio
CFO to Debt

ST+LT
ST+LT
ST+LT+A/P
ST+LT+A/P
EBIT
CFO
CFO

Profitability Analysis
Gross Margin
Operating Margin
Pretax Margin
Profit Margin
ROE after tax
ROTC (preinterest) pre tax

GP
Total Revenue
Operating Income
Total Revenue
Pre interest and pretax Total
income
Revenue
Net Income
Total Revenue
Net Income
Average Equity
EBIT
Avg Total Capital (Debt+Equity)

Equity
*Capital
Equity
**Capital
Interest
Only net Capex
ST+LT

Cipla
1.68
216.65
4.22
86.51
1.77
206.35
2.21
0.82

216.65
86.51
303.16
206.35
96.81
3.62
1.32
0.22
0.72
130.45

0.07
0.06
0.37
0.35
225.01
0.77
2.24

55.54%
21.53%
17.98%
17.90%
17.83%

Glenmark
2.55
143.32
4.44
82.18
3.73
97.93
4.60
0.37

143.32
82.18
225.50
97.93
127.57
10.07
1.07
0.15
2.05
165.54

0.58
0.37
0.65
0.41
7.95
4.48
0.37

66.07%
57.89%
24.87%
21.74%
10.19%

CIPLA
Total Revenue
Gross Profit(Netsales - COGS)
COGS
Slling,Admin,Gen,R&Dexp
Operating Income
Depre
Pre interest and pretax income
Interest
PBT
tax
PAT(Net Income)

6433.88
3573.45
2860.43
2188.06
1385.38
228.86
1156.53
5.14
1151.39
191
960.39

% of Revenues GLENMARK
100%
1153.55
56%
762.14
44%
391.41
34%
428.8
22%
667.83
4%
20.99
18%
286.89
0%
36.08
18%
250.81
3%
67.41
15%
183.4

% of Revenues
100%
66%
34%
37%
58%
2%
25%
3%
22%
6%
16%

120%
100%
Total Revenue
COGS

80%

Slling,Admin,Gen,R&Dexp
60%

Operating Income
Depre

40%

PBT
20%

PAT(Net Income)

0%
CIPLA

GLENMARK

,Gen,R&Dexp

CIPLA
Cash
Mrktble Securities
A/R
Inventories
Current Assets
Net PP&E
Total Assets

84
223
1,497
1,883
4,957

GLENMARK
2011 % of ASSETS
2010 % horz change
2011 % of ASSETS
1% 61
138%
30.95
1%
1% 189
118%
0.00
0%
18% 1,553
96%
189.34
6%
22% 1,513
124%
157.00
5%
59% 4,598
108%
2,069.24
61%
3,121
37%
2,695
116%
263.72
8%
8424.94
100%
7312.62
115%
3,384.33
100%

CIPLA

Total Assets
Net PP&E
Current Assets
Inventories
A/R

GLENMARK

Cash

0%

100% 200% 300% 400% 500% 600% 700%

2010 % horz change

5.07
610%
0
330.09
57%
150.39
104%
1536.68
135%
237.29
111%
2776.56
122%

120%
100%
Total Assets
Net PP&E
Current Assets

Cash

80%

A/R
Inventories

60%

Inventories

Current Assets
40%

Cash

Net PP&E
Total Assets

20%
0%
CIPLA

GLENMARK

rrent Assets

earnings manipulation model

(Annual Compustat items numbers in brackets)

Compustat Data

CIPLA

year -2

2010

Cash [1]
Receivables [2]
Inventory [3]
Current Assets [4]
Current Liabilities [5]
Total Assets [6]
Property, Plant,and Equipment [8]
Sales [12]
Depreciation Expense [14]
Cost of Goods Sold [41]
Current Portion of Long-Term Debt [44]
Amortization Expense [65]
Income Taxes Payable [71]
Long Term Debt [9]
SG&A Expense [189]
Short-term Debt [34]
Deferred tax on Earnings [50]
Equity in Earnings [55]

53
1837
1398.32
4436.3
1012.85
6584
2358.81

60.84
1552.71
1512.58
4597.54
998.25
7312.62
2695.41
5713.82
165.25
2452.98

84.130
1497.040
1883.160
4956.610
1370.710
8424.940
3121.090
6433.880
228.860
2860.430

0
228.5

0.000
227.700

1842.07

2188.060

Time listed (months)

12-month stock market return
Stock market return for comparison portfolio

2011

196.000
0.860
0.130

shaded areas require data

* Beneish, Messod, D. "Detecting GAAP Violation: Implications for Assessing Earnings Management among Firms with Extreme Financial

Compustat Data

Company Name

year -2

2010

Cash [1]
Receivables [2]
Inventory [3]
Current Assets [4]
Current Liabilities [5]
Total Assets [6]
Property, Plant,and Equipment [8]
Sales [12]
Depreciation Expense [14]
Cost of Goods Sold [41]
Current Portion of Long-Term Debt [44]
Amortization Expense [65]
Income Taxes Payable [71]
Long Term Debt [9]
SG&A Expense [189]
Short-term Debt [34]
Deferred tax on Earnings [50]
Equity in Earnings [55]

11.68
409.8
130.31
2124.5
223.25
2337.01
205.25

5.07
330.09
150.39
1536.68
191.04
2776.56
237.29
983.03
21.27
2452.98

30.950
189.340
157.000
2069.240
205.490
3384.330
263.720
1153.550
20.990
391.410

36.3
24.7

39.120
67.400

447.32

428.800

Time listed (months)

12-month stock market return
Stock market return for comparison portfolio

2011.000

196.000
ask amit
0.307

Predictor Ratios:

Formula:
year 0

1. Days Sales

0.856

2. Gross Margin Index

1.028

3. Asset Quality Index

1.809

4. Depreciation Index

0.846

5. SG&A Index

1.055

6. Total Accruals to Total Assets

-0.003

7. Sales Growth Index

1.126

8. Abnormal Return

0.730

9. Time Listed
10. Leverage
11. Positive Accruals Dummy
(Total Accruals, year 0)
(Total Accruals, year -1)
12. Declining Cash Sales Dummy
(Cash sales, year 0)
(Cash sales, year -1)

listed on

4/5/1995

196
1.192
0.000
-27.100
39.810

1.011521
-0.58078

0.000
6489.550
5998.110

Manipulation Index

-1.599

Probability of Manipulation

0.055

nings Management among Firms with Extreme Financial Performance", Journal of Accounting and Public Policy, Vol. 16, No.3, Fall 1997, 271-309.

Predictor Ratios:

1. Days Sales

0.489

2. Gross Margin Index

-2.263

3. Asset Quality Index

0.963

4. Depreciation Index

0.916

5. SG&A Index

0.817

6. Total Accruals to Total Assets

-0.070

7. Sales Growth Index

1.173

8. Abnormal Return
9. Time Listed

Listed on

Formula:
year 0

#VALUE!
196

10. Leverage

0.882

11. Positive Accruals Dummy

(Total Accruals, year 0)
(Total Accruals, year -1)

0.000
0.142
-0.107

12. Declining Cash Sales Dummy

(Cash sales, year 0)
(Cash sales, year -1)

0.000
1294.300
1062.740

Manipulation Index

#VALUE!

Probability of Manipulation

#VALUE!

2.518076
-1.52959

12/10/1999

16, No.3, Fall 1997, 271-309.