Project - Yogesh Final

Jayawant Shikshan Prasarak Mandals
JAYAWANT INSTITUTE OF COMPUTER APPLICATIONS

TATHAWADE, PUNE.
INDEX
CHAPTER No.
1. 1.1 1.2 1.3 2. 2.1 2.2 2.3 2.4 2.5 3. 3.1 3.2 4. 4.1 4.2 4.3 5. 6. 6.1 6.2 6.3
TOPICS
EXECUTIVE SUMMARY INTRODUCTION PROJECT INTRODUCTION OBJECTIVES OF THE STUDY SCOPE & LIMITATIONS COMPANY PROFILE NAME, ADDRESS & LOCATION OF COMPANY VISION , MISSION HISTORY DIFFERENT PRODUCT PROFILES OF THE COMPANY AWARDS THEORETICAL BACKGROUND REVIEW OF LITERATURE FUNDAMENTAL CONCEPTS RESEARCH METHODOLOGY RESEARCH CONCEPTUAL CLARIFICATION SOURCES OF DATA COLLECTION SAMPLE DESCRIPTION DATA ANALYSIS FINDINGS FINDINGS BASED ON ANALYSIS RECOMMENDATIONS / SUGGESTIONS CONCLUSION BIBLIOGRAPHY ANNEXURE
PAGE NO.
A 1 Project Report On Ratio Analysis.
PROJECT REPORT ON ANALYSIS OF FINANCIAL STATEMENTS OF RAYMOND LTD. FOR
(TEXTILE UNIT) JALGAON SUBMITTED TO UNIVERSITY OF, PUNE In partial fulfillment of two years full time MASTER OF BUSINESS ADMINISTRATION (MBA)
SUBMITTED BY YOGES H RAMESH PATHAK (BATCH 2010-2012)
JSPMs JAYWANT INSTITUTE OF COMPUTER APPLICATION, PUNE UNIVERSITY
2 Project Report On Ratio Analysis.
DECLARATION
I, YOGESH RAMESH PATHAK, hereby declare that the Project entitled RATIO ANALYSIS OF RAYMOND LTD carried out at RAYMOND LTD (TEXTILE UNIT); JALGAON is a genuine work for the fulfillment of Master of Business Administration of JSPMS JICA. Pune University and will be solely for the academic purpose. I have prepared this report independently and I have gathered all the relevant information personally. I have prepared this project for the MBA for the year 2010-2012. I also agree in not sharing the vital information with any other person outside the organization and will not submit the project report to any other university.
Place:-Jalgaon Date: / / MBA (FINANCE)
ACKNOWLEDGEMENT It is a great pleasure to me in acknowledging my deep sense of gratitude to all those who have helped me in completing this project successfully. First of all, I record my thankfulness to Institute Director Dr. AJAY KUMAR for providing me an opportunity to undertake a project as a partly fulfillment of MBA degree, I express my deep sense of gratitude to my guide Mr. PRAVIN THORAT whose valuable guidance and encouragement at every phase of the project has help to prepare this project successfully. I would like to thank Mr. A. S. NAGRAJA. (General Manager), Raymond Ltd. Jalgaon, for providing me an opportunity to work with them and providing me necessary information about their organization, various operations and providing guidance in developing my project. I want to thank Mr. SOMNATH GOHIL( M.B.A. ) Sr. Manager Accounts And Mr. PANKAJ PAKHALE (A.I.C.W.A.) Assistant Manager And Mr. SUNIL SONAVANE (A/C Assistant ) for their co-operation and helpful nature in sorting out all the difficulties also for providing me the useful information of value and ethics in the organization. Also, I am really thankful to Mr. K. N. MUNDA and Mr. NILESH PATIL. Last but not least I wish my sincere thanks to all the employees of Raymond Ltd (Accounts department particular) who directly or indirectly helped me in completion of project. Finally, I would like to express my sincere thanks to my family, all the faculties, and office staff, JSPMs Jaywant Institute of Computer Application, Pune and friends who helped in some or other way in making this project.
YOGESH RAMESH PATHAK
EXECUTIVE SUMMARY
This project (Ratio analysis) helps to appraise the firm Raymond ltd, Jalgaon in terms of profitability & efficiency of performance in relation to the industry standards and past year ratios. Ratio analysis tools are used for knowing the financial health of the company. Past ratios of the Raymond Ltd, Jalgaon have been studied, which shows the growth of the company since its inception. Comparisons with pre-determined standard ratios are used for knowing the state of affairs of the company. The project constitutes the introduction of the organization along with details of the products and services offered. Further it tells about the profile of the organization which deals with the different aspects regarding the organization like its address, location, history, product profile, current status, and some other relevant information like its earning concepts, its mission, vision etc. After this there is a discussion about the research design and methodology adopted which deals in the sampling design, sources of data collection and methods of data analysis. Furthermore there is a chapter which is concerned with the findings and data analysis which throws light on the different aspects of the study. Finally, there are some findings and recommendations of which I have come across to a conclusion about the investors while planning for their financial investments to get the expected returns.
OBJECTIVES OF THE STUDY

1. To help in forecasting: - Financial manager for future financial planning can use the ratio. Ratio calculated for a number of years work as a guide for the future.
2. To help to control: - it is a very useful in controlling the areas of inefficiencies or weakness.
3.
To help in efficiency appraisal: - the ratios are the scale of comparison; by conducting inter-firm and intra-firm comparison efficiency of the firm can be appraised.
4. To help in evaluation of financial position
5. To find out the Profitability, Liquidity and Solvency position.
6. To study the strengths & weaknesses of the company.
7. To help in determining historical performance as well as current position.
SCOPE OF THE STUDY

The ratio analysis is very helpful for financial statement analysis of the company. It is very useful for identifying the financial strength and weakness of the firm from the available accounting data and financial statement. The analysis is done by establishing relationship between the different items of financial statement. Ratio analysis is one of the important yardsticks or tool to make bases for the inferences. Ratio analysis is attempted to interpret the information and to form conclusion. Ratio analysis is very useful to internal use because it yields very important information on the aspects such as over & under trading, over & under investment in stock, over and under investment in fixed asset etc. It is also useful to external use because it yields very important information relating to solvency or liquidity position, profitability or the earning capacity. Therefore, ratio analysis is the diagnostic tool in the hands of financial analysis. This project report contains the financial data, majority of which is Secondary in nature. Ratio analysis facilitates understanding of financial statements. It shows the whole state of affairs of the financial conditions of the business. Further it shows the inter-firm comparison and highlights relative performance of the MNC in different areas. It helps in planning the operations of the company; during the period of existence, the company develops certain norms. Any change in the norms passes on the right message for the course of action to be followed. It promotes better utilization of the time and other resources.
COMPANY PROFILE
COMPANY PROFILE
BOARD OF DIRECTO
DR.VIJAYPAT SINGHANIA. Chairman Emeritus GAUTAM HARI SINGHANIA. Chairman and Managing Director 8 Project Report On Ratio Analysis.
I. D. AGARWAL (W.E.F. 23-06-2006) NABANKUR GUPTA P. K. BHANDARI, Whole time Director and Group President SHILESH V. HARIBHAKTI PRADEEP GUHA AKSHAY CHUDASAMA (w.e.f. 21-04-2011) BOMAN R. IRANI (w.e.f. 21-04-2011)
MANAGEMENT EXECUTIVES GAUTAM HARI SINGHANIA, Chairman and managing Director ANNIRUDDHA DESHMUKH, President Textiles & FMCG HARSHAL JAYAVANT, President-Engineering business H. SUNDER, President- Finance, Chief Financial Officer K.A.NARAYAN President HR RAKESH PANDEY, President- Retail & Business Development ROBERT LOBO, President (Operations) Group Apparel SHREYAS JOSHI, President Group Apparel S. L.POKHARNA, President Commercial
DIRECTOR LEGAL AND COMPANY SECRETARY THOMAS FERNANDES BANKERS BANK OF INDIA BANK OF MAHARSHTRA 9 Project Report On Ratio Analysis.
CENTRAL BANK OF INDIA CITIBANK N.A. HDFC BANK LIMITED IDBI BANK LIMITED STATE BANK OF INDIA STANDARD CHARTERED BANK AUDITORS DALAL & SHAH CHARTERED ACCOUNTANTS
REGISTERED OFFICE PLOT NO. 156/ H. NO. 2, VILLAGE ZADGAON RATANGIRI 415 612 (MAHARASHTRA)
HISTORY
Few years ago, when 10 Project Report On Ratio Analysis.
the Singhania family was building, consolidating and expanding its various businesses in Kanpur, one Mr.Wadia was in a similar manner setting up a small woolen mill in the area around Thane creek, 40 kms away from Bombay. The Sassoons, a well-known industrialist family of Bombay, soon acquired this mill and renamed it as The Raymond Woolen Mills. Around the same time the Singhanias aimed to broaden their business horizons. The familys sharp business foresight led to the acquisition of The Raymond Woolen Mills. Further when the grandson of Lala Juggilal, Lala Kailashpat Singhania took over Raymond in 1944, the mill primarily made cheap and coarse woolen blankets, and modest qualities of low priced woolen fabrics. The vision and foresight of Mr. Kailashpat Singhania greatly helped in establishing the J. K. Groups presence in the western region. Under his able stewardship, Raymond embarked upon a gradual phase of technological up gradation and modernization; producing woolen Fabrics of a far superior quality. Under Mr. Gopalkrishna Singhania, the mills become a worldclass factory and the Raymond brand became synonymous with fine quality woolen fabrics. When Dr.Vijaypath Singhania took over the reins of the company in 1980; he injected fresh vigor into Raymond, transforming it into a modern industrial conglomerate.
His son Mr. Gautam Hari Singhania, the present chairman and managing director has been instrumental in restructuring the group. With the divestment of its non-core business, he emerged stronger, with a more focused approach.
Today, with a 33 million-meter capacity in wool and wool-blended fabrics, Raymond commands an over 60% market share in worsted suiting in India and ranks amongst the first three fully integrated manufacturers of worsted suiting in the world. Raymond is perhaps the only company in the world to have adverse product range of nearly 20,000 design and colors of suiting fabric to suit every age, occasion and style. It exports these to over 50 countries, including USA, Canada, Europe, Japan and the Middle East. A 100% subsidiary of Raymond ltd., Raymond Apparel Ltd. Ranks amongst Indias largest and most respected apparel companies. It brings to its customers the best of fabric and style through the some of the countrys most prestigious brands- Raymond Finely Crafted Garments, Monzoni, Park Avenue, Color plus, Parx, zapp! And Notting Hill. Even as the brand keeps evolving through its cuts, styles, apparels and collections, one thing that has remained unchanged over time is the unrelenting pursuit of excellence. Incorporated in 1925, Raymond Limited presently has five divisions comprising of Textiles, Denim, Engineering Files & Tools, Aviation, Designer Wear, and Prophylactics and Toiletries. With a capacity of 25 M meters of wool & wool-blended fabrics making it the third largest integrated manufacturer in the world.
Raymond Limited (Textile Division) has more than 60% market share of the Indian market for worsted suiting fabrics. Promoted as an essential accessory for The Complete Man, its products have set a benchmark in that genre. The company exports its suiting fabrics to more than 50 countries including USA, Canada, Europe, Japan and the Middle East. Raymond Ltd has laid great emphasis on developing strong inhouse skills for research & development since its inception. This unwavering attention to innovation has enabled it to introduce path-breaking new products in 12 Project Report On Ratio Analysis.
the market. Company known to be a pioneer and innovator. Raymond Ltd has raised the performance and product standards of the entire Indian textiles industry. Raymond Ltd, rightfully recognized as the most respected Textile Company of India in January 2003 by "Business World", also produces and markets plush-velvet furnishing fabric in a wide array of designs and colors including carpeting for the niche markets of India and Middle East. Manufacturing facilities include three world-class fully integrated plants in India, employing state-of-the-art technology from wool scouring to finishing stage and modern techniques of quality management. All the plants are self-sufficient in terms of providing educational, housing, recreation and spiritual support system for the employees and connected townships. The woolen mill by the creek in 1925 is presently transformed into a Rs. 1400 Crores conglomerate, but its mantra for continuous growth has remained the same; pursuit of excellence to achieve enhanced customer satisfaction through ongoing innovation. And happily, the growth graph continues to rise higherand higher.
Location of Raymond Ltd in India:-
In India Raymond is located most of generally in Maharashtra state and some are in other state. In the Maharashtra state there were 8 plants and remaining 7 in other state. Maharashtra is the state of which are centralized in India so, most of resources are easily available there. In Thane, Nasik, Jalgaon, Aurangabad, Yavatmal, Chiplun, Ratnagiri, Kolhapur these are the city where as Raymond build up their business in Maharashtra.
MILESTONES IN RAYMOND 1925 - Setup of The Raymond Woolen mill in the area around Thane creek.
1944: Lala Kailashpat Singhania took over The Raymond Woolen Mill. The mill was primarily making cheap and coarse woolen blankets, and modest quantities of low priced woolen fabrics. 1950 - Setup of a new manufacturing activity for making indigenous engineering files known as JK Files & Tools. This has now become the largest facility of its kind in the world. 1958 - The first exclusive Raymond Retail showroom, King's Corner, was opened in 1958 at Ballard Estate in Bombay. 1964 - Setup of a new Combing Division. This was followed by a phase of vertical integration, facilitating in the processing of multi-fibers and technology improvements to make blended fabrics. 1968 - Raymond setup a readymade garments plant at Thane. The readymade garments division of Raymond has since then grown rapidly. Raymond has now become the leader among ready-mades, in India, achieving a business turnover of over Rs. 2000 million. 1979 - A new manufacturing facility was set up at Jalgaon, to meet the increasing demand for worsted woolen fabrics. 1980: Vijay pat Singhania took over the reins of the company. He injected fresh vigor into Raymond, transforming it into a modern, industrial conglomerate. 1986 - Launch of "Park Avenue", the premium lifestyle brand providing a complete wardrobe solution to the men who like to dress well & be current on styles & fashion. 1990 - The first showroom abroad for Raymond in Oman.
1991 - A new manufacturing facility was set up at Chindwara, near Nagpur.
1995: Superfine pure wool collection under the Lineage Line (Super 100S to Super 140S).
1996: The Renaissance Collection made of Merino wool blended with polyester and specialty fibers (Super 100S to Super 140S).
1996: Raymond's denim; focusing on quality, innovation and the creation of exclusive products that have always caught the eye of some of the world's leading denim wear brands. Its designs have always kept pace with the changing styles and cuts found in every youngster's closet. With a 40 million meters capacity, Raymond today ranks amongst the top 2 producers of ring denim in India.
1999: The Chairman's Collection of Super 150S made from Merino Wool and Cashmere followed by Super 160S to Super 190S.
1999: Launch of "Parx", a premium casual wear brand bringing customers a range of semi-formal and casual clothes.
2000: Launch of "Be: exclusive prt line of ready-to-wear designer clothing for men and women.
2002: Acquisition of Color Plus. 2003: Setup of 'Silver Spark Apparel Ltd.' for manufacturing suits and formal trousers catering largely to export markets.
2004: Super 220S fabrics under the Chairman's Collection. 2005: Setup of state-of-the art Jeanswear facility 'Ever blue Apparel Ltd.' near Bangalore.
2005: Setup of state-of-the art facility 'Celebrations Apparel Ltd.' for the manufacturing of formal shirts.
2005: Raymond achieved a rare feat and a historical milestone with the creation of the world's finest worsted-suiting fabrics from the finest wool
ever produced in the world- The Super 230s made up of 11.8 micron of wool. 2005: Launch of 'Expressions' an exquisite collection of all wool and plywood suiting specially crafted using exotic fibers like Cashmere, Angora, Mohair, Bamboo, Casein. 2006 Set of Raymond's third worsted unit at Vapi in Gujarat. Raymond now has 3 state of the art units with a combined capacity of 31 million meters of worsted fabric. 2006 Launch of design studio in Italy for cutting edge design capabilities for exports and domestic brands. 2006: Set up of world class carded woolen unit, Raymond Fedora Ltd, in Jalgaon. 2006 Set up of Greenfield shirting unit at Kolhapur producing high value cotton shirting. This facility is set up as part of the company's JV with Gruppo Zambaiti. 2006 Set up of J.K. Talabot Ltd - JV with MOB, France for the manufacturing of files and rasps. 2006 Launch of Zapp! our kidswear brand with first store in Ahmedabad. 2007 Entered into Joint Venture to retail premium brand GAS in India. 2007 Launch of new brands for womens wear. 2008 Launch of 'Raymond Finely Crafted Garments' readymade apparel under Raymond brand.
RAYMOND TODAY
Today, the Raymond group is vertically and horizontally integrated to provide customers total textile solutions. Few companies globally have such a diverse product range of nearly 20,000 varieties of worsted suiting to cater to customers across age groups, occasions and styles. We manufacture for the world the finest fabrics- from wool to wool-blended worsted suiting to specialty ring denims as well as high value shirting. After making a mark in textiles, Raymond forayed into garmenting through highly successful ventures like Silver Spark Apparel Ltd. And Regency Texteis Portuguesa Lda (for fine Tailored Suits, Trousers and Jackets), Ever Blue Apparel Ltd. (Jeans wear) and Celebrations Apparel Ltd. (Shirts). The Raymond Group also has an expansive retail presence established through the exclusive chain of 'The Raymond Shop' and stand-alone brand stores for Raymond Finely Crafted Garments, Manzoni, Park Avenue, Color Plus, Parx, Be:, Zapp! And Notting Hill. With a US$500 million turnover Raymond is today one of the largest players in fabrics, designer wear, denim, cosmetics & toiletries, engineering files & tools, prophylactics and air charter services in national and international markets. All plants are ISO certified, leveraging on cutting-edge technology that adheres to the highest quality parameters while also being environment friendly. Companies design Studios in India and Italy are supported by six states- of- the- art textile plants and four garmenting factories in India and Europe. Being integrated suppliers of fabrics as well as garments, company offer customers total textile solutions
COMPANY HIGHLIGHTS
Vision
TO BE THE WORLDS MOST ADMIRED WORSTED SUITING COMPANY. This policy is available to all employees and interested parties. Raymond believes in Excellence, Quality and Leadership Raymond Limited is Indias leading producer of worsted suiting fabric with a 60% market share.
Mission
We commit to the HR vision of making "Raymond the most Desired Workplace for top talent". We will strive to weave in the core Raymond values namely Quality, Trust, Leadership, and Excellence in all our actions & HR Processes so as to make every Raymondite a complete man.
ABOUT JALGAON UNIT
The JALGAON Unit, one of the three production divisions of the Textile Division, is located at Jalgaon on Nagpur-Mumbai rail route and is located in the MIDC Industrial Estate on Ajanta Road; Jalgaon is well connected with all places in India by rail and road. The vision for setting up the unit at JALGAON was to, manufacture world-class grey fabrics at competitive prices, establish a large-scale unit in a backward area, which needed accelerated development, ensure all-round socio-economic progress of the region and its hinterland, catalyse the emerging industrial potential of smaller towns of the country, and provide additional sources of employment to people in & around Jalgaon. JALGAON Unit has two plants. The woollen plant produces blankets. The worsted fabrics division produces high quality grey mended fabrics in polyester-wool and polyester-viscose blends. The worsted fabrics plant is located on a 43,800 sq m plot with a built-up area of 18,472 sq mt. (42.2%). The plant is well equipped with the most modern machinery, ensuring high efficiency and productivity. The work force is adequately skilled, well trained and competent. The worsted fabrics plant became operational in March 1979. Its main inputs, polyester-wool and polyester-viscose tops, are received from Chhindwara Unit and Thane Unit of Raymond Limited. Its products, grey mended fabrics are returned to the Chhindwara and Thane Units.
The unit has an in-house well-equipped laboratory for carrying out the various tests of in-coming, in-process and finished products. The production is planned on basis of targets and programmes received.
ABOUT JALGAON PLANT
Location Head Office Registered Office Corporate Office Production Commenced on Chairman Emeritus Chairman Raymond Chief Operating Officer President-Textile Works Director(Jalgaon) We Manufacture Output Divisions, Jalgaon Worsted Area of the Plot Power Consumption Water Consumption Number of Employees
Raymond Limited is situated 5 Kms. From Jalgaon Railway station in Maharashtra Industrial Development Corporation (MIDC), on Ajanta Road way to Aurangabad J.K. Organization (Western Zone), J.K. Building N. Morarjee Marg Ballard Estate, Mumbai 38 Raymond Limited Plot No. 156/H.No. 2 Village Zadgaon, Ratnagiri Maharashtra 415 612 Raymond Limited ,(Textile Division) Mahindra Tower,Bwing,3 Pandurang Budhkar Marg, Worli,Mumbai-18 March 1979 Dr. Vijaypatji Singhania Shri Gautam Hari Singhania Shri Deepak Khetrapal Shri S.K. Singhal Shri A. S. Nagaraja Suitings Polyster/Wool, Polyster/Viscose Fabrics. Worsted Division Worsted Division manufacturing Worsted Suiting fabric with polyester-wool and polyester-viscose blends 70,960 sq mts. 138.20 lacs unit / year (Worsted) ,32.49 lacs unit /year (Woollen) 89.31 lacs litre/year. (Worsted) ,145.75 lacs litre/year 593(Workers) + 14(Clerks) +40(Supervisors) +75(Management staff)
PRODUCT PROFILE
For over 80 years, Raymond is counted as one of the world's premier manufacturers of worsted suiting fabric in fine grade wool, in the same league as the finest that Europe has to offer. Today, the Raymond product range includes pure wools, wool blended with exotic fibers like camel hair, cashmere and angora and innovative blends of wool with polyester, linen and silk. Offering suiting and trousering fabric for all occasions and needs. Our domestic distribution is spread far and wide with more than 30,000 outlets that stock and sell our wide range of fabrics. Fine products, wide range, superb distribution and intelligent advertising support have helped the company gain a dominant share of the market. No wonder, premium labels from the world's fashion capitals prefer Raymond.
Raymond Premium Apparel is a premium formal wear brand which is positioned to offer classic garments with impeccable fits and inviting styles to the Global Indian. Needless to say that the product is made only from premium Raymond fabrics.
Manzoni is a luxury lifestyle brand offering the discerning customer a super premium range of formal wear and sportswear including shirts, suits, trousers, jackets, ties and leather accessories. Our exclusive designs provide customers the best in contemporary international style & luxury. Each garment is crafted from the most exotic cotton silk, linen and superfine wool, the best-in-the-world linings, interlinings and threads sourced from around the globe.
Launched in 1986, Park Avenue is today, India's most admired formalwear brand. It offers stylish and innovative wardrobe solutions to gentlemen for all their dressing needs, be it Business, Evening, Leisure, Travel or Heritage Wear. The brand has received several awards. 24 Project Report On Ratio Analysis.
Recently, it had the honor of being the 'Most Admired Brand' at the Lycra Images Fashion Awards 2007 for the third consecutive year. Crossing the gender divide, Park Avenue launched 'Park Avenue Woman' - a complete range of Business Wear for women. Park Avenue Woman is designed especially for the working women professionals of today.
Color Plus is one of India's premium and most respected casual wear brands offering customers a range of shirts, trousers, knits and survival gear. Color Plus constantly innovates processes and technologies offering buyers new worlds of comfort. Some of the technological innovations it is well known for; include thermo-fused buttons, golf ball wash, soft jeans, wrinkle free technology, stain-free fabric, and the cone dyed technique. Adding new color now to the womans wardrobe, Color Plus recently launched Color plus Woman An exclusive range of smart-casual clothing.
Parx is a premium casual lifestyle brand, which is positioned to cater to the needs of consumers who are looking for dressing up for life across occasions and events. Parx makes available the latest international trends through differentiated designs and styles. It has always been part of the consumer who is looking at making lifestyle statements.
The burgeoning children's wear market has now turned stylish with Zapp! - our range of stylish and fashionable kidswear. The brand brings to 4-12 years a wide range of clothes, accessories, bed and bath linen and more. The first Zapp! store has been launched in Ahmedabad with ten more on their way for kidscross the country.
Notting Hill reflects style and manifests originality of today's fashion- conscious and discerning young professionals at an affordable price. The brand collection features a spectrum of men's lifestyle products comprising of suits, shirts, trousers, jeans, t-shirts and also accessories like ties, handkerchiefs and socks.
THEORETICAL BACKGROUND INTRODUCTION Ratio analysis is a power full tool of financial analysis based on ratio. In financial analysis ratio is used as a benchmark evaluating the financial position and performance of a firm. The absolute accounting figure reported in the financial statements do not provide full understanding of the financial position of a firm, but well expressed in terms of related figure, it yields significant inference. Ratio analyses reflect a quantitative relationship that helps to form qualitative judgment.
Definition: Ratio analysis is a systematic use of ratio to interpret the financial statement so that the strength and weakness of the firm, its historical performance and current financial condition can be determined. --- Khan & Jain.
Objectives: 1. To judge the earning capacity, operating efficiency, financial soundness and liquidity position of an enterprise in an unambiguous manner. 2. To access the comparative changes and the degree of improvement in the financial health of the enterprise, profitability or liquidity position. 3. To provide the proper base for decision making purpose for the uses of financial statement. 4. To pin point area of the shortcoming which facilities to take corrective measures by the management. 5. To provide base for future planning and preparing various budget. 6. To highlights the companys performance by giving a glance of information to the management and others.
Benchmarks (Standards)
Ratio Analysis involves comparison for the purpose of proper interpretation of an Accounting data. These Ratios relating to current year are compared with the standards. These standards may be: 1] Past Ratio of the same company. 2] Projected Ratios. 3] Competitors Ratios. 4] Industries Ratios.
When past Ratio of a Company is taken as a standard for comparison for

evaluating the performance over a period of time, it is known as Trend or Time Series Analysis. This Analysis shows the direction of change which may be favorable or unfavorable as compare to previous year.
The use of predetermined projected ratios as standards to compare the

current and past performance is covered under Performa Analysis. If projected Ratio indicate unfavorable position, then the corrective measure must be taken.
When Ratio of enterprise are compared with ratio of other enterprise of the
same industry at the same point of time, it is known as Cross Sectional Analysis. Inter firm comparisons reflect the performance of a firm in relation to its competitors.
Under industry analysis the ratios are compared with the average ratios of
the industry under which it operates. This analysis helps in ascertaining the variation in profitability, liquidity, solvency & financial position of the enterprises as against the overall industry position.
Advantage:
1. To Work out the Profitability: Accounting Ratio helps to measure the profitability of the business by calculating the various profitability ratios. It helps the management to know about the earning capacity of the business. In this way profitability ratio shows the actual performance of the business. 2. Helpful in Analysis of Financial Statement: Ratio analysis helps the outsiders just like Shareholder , Creditors , Debenture holder , Bankers to know about the profitability and ability of the company to pay them Dividend and Interest etc. 3. Helpful in Comparative analysis of the performance: With the help of Ratio Analysis a company may have comparative study of its performance to the previous year. In this way company comes to know about its weak point and be able to improve them. 4. To simplify the Accounting Information: Accounting ratio are very useful as they briefly summarized the result of detailed and complicated computation. 5. To workout the Operating Efficiency: Ratio Analysis helps to work out the Operating Efficiency of the company with the help of various turnover ratios. All Turn over Ratios are worked out to evaluate the performance of the business. 6. Helpful for Forecasting Purpose: Accounting Ratio indicates the trend of the business. The trend is useful for estimating future with the help of previous years Ratio; estimate for future can be made. In this way these Ratios provide the basis for preparing budget and also determine future line of action.
Limitations:
1. Limited Comparability:
Different Firm applies different accounting policies. Therefore the Ratio of one firm cannot be always compared with ratio of another firm. There may be difference in providing depreciation of fixed asset or certain of provision for doubtful debt etc. 2. Effect of Price Level Changes: Price level changes often make the comparison of figures difficult over period of time, Changes in price affects the cost of production, sales and also the value of asset. Therefore, it is necessary to make proper adjustment for price level changes before any comparison. 3. Effect of Window Dressing: In order to cover up their bad financial position some companies resort to window dressing. They may record the accounting data according to convenience to show the financial position of the company in a better way. 4. Costly Technique: Ratio analysis is costly technique and can be used by big business houses. Small business unit are not able to afford it. 5. Absence of Standard University Accepted Terminology: There are no standard Ratio, Which are universally accepted for comparison purpose. As such, the significance of ratio analysis technique is reduced.
RATIO ANALYSIS It is true that the technique of ratio analysis is not a creative technique in the sense that it uses the same figures & information which is already appearing in the financial statement at the same time, it is also true that what can be achieved by the technique of ratio analysis cannot be achieved by the mere preparation of financial statement.. Ratio analysis helps to appraise the firms in terms of their profitability & efficiency of performance, either individually or in relation to those of other firms in the same industry. The ratio by all them does not mean anything, until the ratios are compared with something. This comparison may be in the form of intrafirm comparison, inter- firm comparison with standard ratios. Thus, proper comparison of ratio may reveals where a firm is placed compared with earlier periods or in comparison with other firms in the same industry. As the ratio analysis is concerned with all the aspects of a firms financial analysis i.e. liquidity, solvency, activity, profitability & overall performance, it enables the interested persons to know the financial & operational characteristics of an organization & take the suitable decisions. The ratio may be classified under various ways, which may use various criterias to do the same. However, for convenience purpose, we will classify the ratios under the following groups:1) 2) 3) 4) 5) Liquidity Ratio Turnover Ratio Leverage Ratio Profitability Ratio Overall profitability Ratio
1) LIQUIDITY RATIO:-
The ratios computed under this group indicate the short term position of the organization & also indicate the efficiency with which the working capital is being used. Commercial bank & short term creditors may be basically interested in the ratios falling under this group. Two most important ratios may be calculated under this group are:-
a) Current Ratio:It is calculated as:-
Current ratio indicates the backing available to current liabilities in the form of current asset. In other words, a higher current ratio indicates that there are sufficient assets available with the organization which can be converted in the form of cash, without any reduction in value, in short span of time, i.e. current liabilities. As such, higher the current ratio better will be the situation.
b) Liquid /Acid Test / Quick Ratio:It is calculated as:-
Liquid ratio indicates the backing available to liquid liabilities in the form of liquid asset. The term liquid asset indicates the assets which can be converted in the form of cash, without any reduction in value, almost immediately whereas, the term liquid liabilities which are required to be paid almost immediately. In other words, a higher liquid ratio indicates that there are sufficient asset available with the organization which can be converted in the form of cash almost immediately to pay off those liabilities which are to be paying off almost immediately. As such higher the liquid ratio better will be the situation.
2) TURNOVER RATIO:-
The ratio computed under this group indicates the efficiency of the organization to use the various kinds of assets by converting them in the form of sales. As the assets can be basically categorized as fixed assets & current asset &as the current may further be classified according to the individual components of current asset viz. inventories, receivables or debtors or as net current assets i.e. current assets less current liabilities viz. working capital, under this group of classification of ratios, following ratios may be computed:-
Fixed Asset Turnover Ratio:It is calculated as:-
A high fixed assets turnover ratio indicates the capability of the organization to achieve maximum sales with the minimum investment in fixed assets. It indicates that the fixed assets are turned over in the form of sales more number of times. As such, higher the fixed assets turnover ratio better will be the situation. Working Capital Turnover Ratios:It is calculated as:-
Working capital = Current Assets -Current liabilities A high working capital turnover ratio indicates the capability of the organization to achieve maximum sales with the minimum investment in working capital. It indicates that the working capital is turned over in the form of sales more number of times. As such, higher the working capital turnover ratio better will be the situation Inventory / Stock Turnover Ratio:
It is calculated as :-
A high inventory turnover ratio indicates that maximum sales turnover is achieved with the minimum investment in inventory. As such, high inventory turnover ratio is desirables.
Total Assets Turnover Ratio:It is calculated as =
Net sale Total asset
Total Assets = Net Fix Assets + Current Assets Measure the activity of the assets and the ability of the business to generate sales through the use of the assets. It revels the efficiency in managing an utilizing the total assets
3) LEVERAGE RATIOS: -
This is calculated to judge the long-term financial position of the firm. These ratios indicate mix of fund provided by owners and lenders. These ratios indicate the extent to which the interest of the person entitled to get a fixed return or a scheduled repayment as per the agreed term, are safe. The higher the cover the better it is. Net Asset to Net-worth ratio: Net Assets to Net-Worth Ratio = Net Assets Net-Worth This is another alternative way of expressing the basic relationship between debt & Equity. This ratio gives the funds contributed together by lenders and owners for each rupee of owners contribution Debt equity ratio: It is also popularly known as `external internal equity ratio. It relates all short-term & long-term recorded creditors claim on assets to the owners recorded claim in order to measures the firms obligation to creditor in relation to funds provided by the owner.
4) PROFITABILITY RATIO:-
As the name itself suggest, the intention for calculating these ratios is to know the profitability of the organization. Following ratios may be computed under this Group:-
a) Gross Profit Ratio:It is calculated as:-
The gross profit ratio indicates the relation between production cost & Sales & the efficiency with which the goods are produced or purchased. A high gross profit ratio may indicate that the organization is able to produce or purchase at a relatively lower cost. As such, a high gross profit ratio will be desirable.
b) Net Profit Ratio:It is calculated as:-
The net profit ratio indicates that portion of sales available to the owners after the consideration of all types of expenses & costs either operating or nonoperating or normal or abnormal. A high net profit ratio indicates higher profitability of the business.
5) OVERALL PROFITABILITY RATIOS:-
The ratio computed under this group indicates the relationship between the profits of a firm & investment in the firm. These ratios are popularly known as return on investment. As such, there can be three broad classification of return on investment.
Return on Assets:It is calculated as:-
It measures the profitability of the investments in the firm. As such, higher return of assets will be always being preferred. However return on assets does not indicate the profitability of various sources of funds which finance total assets. Return on Capital Employed:It is calculated as:-
It measures the profitability of the capital employed in the business. A high return on capital employed indicates a better &profitable use of long term funds of owners & creditors. Return on Equity:It is calculated as: PAT X 100 Net-Worth A return on shareholder equity is calculated to see the profitability of owners investment. Return on equity indicates how well the firm has used the resources of owners. This ratio is, thus, of great interest to the present as well as the prospective shareholder and also of great concern to management, which has the responsibility of maximizing the owners welfare.
RESEARCH METHODOLOGY
Research is common parlance refers to a search for knowledge. One can also define research as a scientific & search for pertinent information on a specific topic. In fact, research is an art of scientific investigation. The Advanced Learner Dictionary of Current English lays down the meaning of research as, a careful investigation or inquiry especially through search for new facts in any branch of knowledge. Redman & Mory define research as, a systematized effort to gain new knowledge. Some people consider research as a movement, a movement from the known to the unknown. It is actually a flight of discovery. Research is an academic activity & as such the term should be used in a technical sense. Research is an original contribution to the existing stock of knowledge making for its advancement. It is the pursuits of truth with the help of study, observation, comparison & experiment. In short, the search for knowledge through objective & systematic method of finding solutions to a problem is research. As such, the term research refers to the systematic method consisting of diction the problem, formulation a hypothesis, collecting the facts or data, analyzing the facts & reaching certain conclusions either in the form of solutions towards the concerned problem or in certain generalization for some theoretical formulation.
SOURCES OF DATA COLLECTION: 1] Primary data 2] Secondary data PRIMARY DATA:The primary data are those which are collected afresh & for the first time & thus, happen to be original in character. For carrying out this project, I made informal discussion with the company officials of Raymond limited, Jalgaon i.e. Finance manager & Accounts Manager, Accounts executive. SECONDARY DATA:This project is mainly based on Secondary Data of the Raymond ltd. Jalgaon. The secondary data are those which have already been collected by someone else & which have already been passed through the statistical process. The data which I collected from the firm was available in its annual statements of Jalgaon unit for the years ( 2006 2007, 2007 2008 , 20082009, 2009-2010,2010-2011.), Balance Sheet, Profit & loss account, which I got with the permission of manager accounts & Finance. The ratio calculated in this project has been done as per discussion with the accounts department of the companies unit Jalgaon.
CALCULATION AND INTERPRETATION

1)
LIQUDITY RATIO:Current Assets Loan & Adv. Current Liabilities & Provisions
a) Current Ratio =
Financial year 2007 2008 2009 2010 2011
Current Assets ( Rs. in lacs ) 82490.59 94342.30 98165.33 92960.82 108051.58
Current Liabilities ( Rs. in lacs ) 37147.56 35799.26 41010.85 35678.56 48535.48
Current Ratio 2.22 2.63 2.39 2.60 2.22
Interpretation: It is observed that the current ratio of the organization have always been above the standard required. But in year 2008 the ratio was high which mean the current ratio was high as compare to current liabilities which shows that the assets were kept idle & not brought in use In the year 2009 the ratio was found slight less as compared to 2008 & the more assets were brought in use. In 2010 it is again increased. In 2011 the firms ability to meet current obligations is good as compared to the industry average of 2:1. Overall we can state that the financial health of the company is very strong.
b) Quick Ratio =
Current Assets Loan & Adv. - Stock
Current Liabilities & Provision
Financial Current Assets Stock year ( Rs. in lacs ) 2007 2008 2009 2010 2011 54124.23 61368.12 64124.97 64510.44 66742.48
Current Liabilities ( Rs. in lacs ) 37147.56 35799.26 41010.85 35678.56 48535.48
Quick Ratio 1.45 1.71 1.56 1.81 1.37
Interpretation & Analysis:According to the figures, in 2011 the firms ability to meet its current claims is good. But in overall years current assets of company excluding inventories was high as compare to the current liabilities. This Denotes Companies better Financial Position
TURNOVER RATIO
Net Sales Fixed Assets Turnover = Fixed Assets
Financial year 2007 2008 2009 2010 2011
Net Sales ( Rs. in lacs ) 129962.75 133756.33 139325.37 133936.91 149653.25
Fixed Assets ( Rs. in lacs ) 76174.15 73310.87 106115.24 98206.13 95971.81
Fixed Assets Turnover Ratio 1.70 1.82 1.31 1.36 1.55
Interpretation & Analysis:It measure the efficiency with which fixed asset are employed. A high Ratio means a high rate of efficiency of utilization of Fixed Asset and low ratio means improper use of assets. From over all figures in 2008 the fixed assets turnover ratio was quite better but latter there was decrease in the ratio, which indicates that fixed assets are not being used to optimum level and there is a scope to manage fixed assets in a better way. . In the year 2010 it is slightly increased. In the year 2011 efficiency of utilization of fixed asset is slightly increased compared to 2009 & 2010.
Working Capital Turnover Ratio =
Net Sales Working Capital
Working Capital = Current Assets Current Liability Financial year 2007 2008 2009 2010 2011 Net Sales Working Capital Working Capital ( Rs. in lacs ) ( Rs. in lacs ) Turnover Ratio 129962.75 133756.33 139325.37 133936.91 149653.25 45343.03 58543.04 57154.48 57282.26 59516.10 2.86 2.28 2.43 2.34 2.51
Interpretation & Analysis:Working capital ratio indicates extent of working capital used. The higher is the Ratio, the lower is the investment in the Working Capital and the greater are the profit. A low Working Capital Turnover Ratio indicates that the working capital had not been used efficiently. Higher the working capital turnover ratio better will be the situation. Working capital ratio of Raymond indicates that working capital utilization was better in 2007 than other years. But over the next years it needs to concentrate over better utilization of working capital for increasing sales
Inventory Turnover Ratio
Cost of Goods Sold Average Inventory
Cost of Goods Sold= Sales Gross Profit Financial year 2008 2009 2010 2011 COGS ( Rs. in lacs ) 46855.29 44290.85 39125.88 48190.41 Avg. Inventory ( Rs. in lacs ) 30670.27 33507.27 31245.37 34879.74 Inventory Turn Over Ratio 1.52 1.32 1.25 1.38
Interpretation: A high inventory turnover ratio indicates that maximum sales turnover is achieved with the minimum investment in inventory. It is observed that in 2008, ratio was high as compare to other years. As such, inventory turnover ratio is desirable in 2008.Inventory turnover ratio is slightly increased by 0.6 in 2011.
a) Total Assets Turnover Ratio =
Net Sales Total Assets
Total Assets = Net Fix Assets + Current Assets Net Sales Financial year ( Rs. in lacs ) 2007 2008 2009 2010 2011 129962.75 133756.33 139325.37 133936.91 149653.25
Total Assets Total Assets ( Rs. in lacs ) Turnover Ratio 150096.23 166294.81 198069.88 187002.67 278035.96 0.86 0.80 0.70 0.71 0.53
Interpretation & Analysis: It is observed that there was not proper increase in sales as compare to the total assets. This denotes that there was not proper utilization of total assets in increasing net sales
SOLVENCY RATIO: Net Assets to Net-Worth Ratio = Net Assets Net-Worth
Financial year 2007 2008 2009 2010 2011
Net Assets Net Worth Net Assets to Net( Rs. in ( Rs. in Worth Ratio lacs ) lacs ) 67605.64 71952.51 99904.55 94041.85 85773.78 135615.94 141915.45 114785.32 117291.07 106558.49 0.49 0.50 0.87 0.80 0.80
Interpretation & Analysis:It can be seen that the net assets to the Net-Worth ratio is showing increasing trend from 2007 to 2009. But in 2010 ratio again decrease slightly. The overall net assets which are more than net-worth imply that the shares of owners capital in net assets are increasing which reduces the dependency of company on borrowing.
PROFITABILITY RATIOS
a) Gross Profit Ratio =
Gross Profit X 100 Sales
Financial year 2007 2008 2009 2010 2011
Gross Profit Sales ( Rs. in ( Rs. in lacs ) lacs ) 34840 22287 -12373 22938 5277 129962.75 133756.33 139325.37 133936.91 149653.25
Gross Profit Ratio 26.80 16.66 -8.88 17.12 3.52
Interpretation & Analysis:The Gross Profit ratio measures the efficiency of the companys operation and this can also be compared with the previous year results to ascertain the efficiency. Above ratio indicates that, companys position was good in 2007 & 2008 but in 2009 the Co. sold its stake in joint venture Co. on account of which it faced the loss. However in 2010 company recovered from previous loss and making good amount of gross profit. Again in 2011 companys position is very bad. It just made a gross profit of 3.52%.
b) Net Profit Ratio =
Net Profit Sales
Financial year 2007 2008 2009 2010 2011
Net Profit ( Rs. in lacs ) 20125.28 6612.17 27040 2637 10487
Sales ( Rs. in lacs ) 129962.75 133756.33 139325.37 133936.91 149653.25
Net Profit Ratio 15.48 4.1 -19.4 1.96 -7
Interpretation & Analysis: The Net Profit Ratio measures the efficiency in operation of the company. The above ratio indicate consistent decrease in net profit ratio up to 2009 due to economic downturn, but in 2010 company try to recover from it which is good as compare to previous year. Despite better economy Condition Company not performing well & incurred a loss in the year 2011.
c) Return On Assets =
PAT X 100 Total Assets
Financial year 2007 2008 2009 2010
PAT ( Rs. in lacs ) 20212.03 7242.30 (27155.13) 2505.75
Total Assets ( Rs. in lacs ) 257112.24 272383.37 293140.03 280345.51
Return On Assets 8 3 (9) 0.8
2011
(10019.19)
278035.96
(3.60)
Interpretation & Analysis: This ratio indicates the efficiency of utilization of assets in generating revenue. This ratio indicates decrease in return on asset in 2008 and loss in 2009 but in 2010 company is improving as compare to previous year.
d) Return on Equity =
PAT X 100 Net-Worth
Financial PAT Net Worth year ( Rs. in lacs) ( Rs. in lacs ) 2007 2008 2009 2010 2011 20212.03 7242.30 (27155.13) 2505.75 (10019.19) 135615.94 141915.45 114785.32 117291.07 106558.49
Return On Equity 15 5 (24) 0.20 (9.4)
Interpretation & Analysis: Return on equity indicates measure of profitability, the efficiency in use of asset in achieving sales, and measure of leverage. The above ratio shows the there is decrease in profitability in 2008 as compare to 2007 and in 2009 company incurred loss but 2010 company improve the position by gaining little return in 2010.
Return on capital employed =
PAT X 100 Capital employed
Capital Employed = Net Fix Asset + Working Capital + Investment (Trade & Long Term)
Financial PAT Capital Employed year ( Rs. in lacs ) ( Rs. in lacs ) 2007 2008 2009 2010 20212.03 7242.30 -27155.13 2505.75 219964.38 236584.11 252129.18 244666.98
ROCE Ratio 9.18 3.07 -10.7 1.02 54
Project Report On Ratio Analysis.
2011
-10019.19
232283.75
-4.31
Interpretation & Analysis: According to the overall figures there is not sufficient profit after utilization of capital while ratio indicates decrease in 2008 and loss in 2009 but in 2010 company improve their position by gaining increase in ROCE ratio
FINDINGS
In the overall on the four years current ratio was below three and the highest was in 2008 at 2.63. Liquidity Position of the Raymond Ltd. was found very satisfactory. Current Ratio and Liquid Ratio shows the Liquidity position. It reflects the firms ability to meet short-term obligations. In the year 2008 liquidity position is very sound because in the year 2008 current ratio was more than the corresponding years. As a matter of fact, ratio higher that 2:1 may be unsatisfactory from the point of view of Profitability and it may be satisfactory from the view point of Solvency. The liquidity position is above normal, which may be due to excessive stock position.
1. From the gross profit ratio we can see that there is continuous decrease in gross profit
except the year 2007 and in the year 2009 the company is in loss. However in 2010 company recovered from previous loss and made good amount of gross profit, Low ratio indicates idle capacity.
2. Low total asset turnover ratio denotes that there was not proper utilization of total
assets in increasing net sales.

3. The liquidity ratio of the organization is very good through which we can find out that
the organization can pay out its debts whenever required. 4. According to inventory ratio it is found the operation cycle of organization is short. It is observed that in 2008, ratio was high as compare to other years. As such, inventory turnover ratio is desirable in 2008. 5. Working capital ratio of Raymond indicates that working capital utilization was better in 2007 than other years. But over the next years it needs to concentrate over better utilization of working capital for increasing sales 6. In 2008 the fixed assets turnover ratio was quite better but latter in 2009 there was decrease in the ratio, which indicates that fixed assets are not being used to optimum level 7. In the year 2009, Profitability position of the Raymond Ltd. was worst and the company suffered loss.
LIMITATIONS
1) The present project is limited to Raymond ltd. Jalgaon only. Therefore, this
project is also limited to Manufacture Sector.
2) The period of the study of the present project was financial year 2006-2007 to
2010- 2011. Therefore, the present project is only limited to the financial year 2006-2007 to 2010-2011. 57 Project Report On Ratio Analysis.
3) This project communicates only a relative picture because analysis was made within the company. 4) Two month project period was not sufficient for studying the present topic.
5) This project possesses all the inherent limitations of financial data and secrecy norms.
Ratio provides only quantitative information, not qualitative information. This is not a universal study; it is only a sample case study.
SUGGESTIONS
1. A very high Liquidity ratio should convey alarming signals due to the following reasons:a. Money may be blocked in inventories due to poor sales. b. Collection from Debtors might have been poor due to slack collection policy. c. There may be slack cash and bank balances due to improper cash or poor investment policy. 2. A very low liquidity ratio is also alarming due to following reasons:58 Project Report On Ratio Analysis.
a. The firm may not be having sufficient liquidity (Cash etc.) to pay its immediate liability and this fact may crush even an organization otherwise financially sound. b. The firm may be trading beyond its resources. 2 Fixed Assets Turnover has declined in the year 2009 & 2010 in comparison to the preceding Years. This indicates that in the year 2009 & 2010, there was less efficient use of fixed assets. Therefore, it is suggested that in future company should efficiently used its fixed assets.
3
Inventory turnover will need the proper management to increase the sales. There should be a proper analysis of the company over a sale and to find out reason for decrease in sales.
Proper utilization of assets contributes to the net sales ultimately increase the profit.
Demini Eco was a company which is taken over by the company which was suffered from loss and such loss is set up in profit of Raymond .So it is require to analysis the effect of purchasing Demini Eco.
CONCLUSION
Ratio analysis is one of the very effective tools of financial analysis. For evaluating the financial position and performance of the organization the financial analyst need some yardstick or tool to make basis for his opinion. Ratio analyst is attempted to form conclusion. Before ratio analysis is attempted, clear understanding of the purpose is very necessary. 59 Project Report On Ratio Analysis.
Computation of ratio is relatively an easy exercise. But usefulness of ratio analysis depends on its intelligent and judicious interpretation. Ratio analysis highlights relative performance of the company in different areas. Thus, this company is efficient in various areas. The financial condition of the Raymond ltd, Jalgaon is strong.
RECOMMENDATIONS
The organization can have a better utilization of asset, for e.g., by investing excess cash in liquid assets, it can be utilizing as idle cash as well as can be used to earn some returns.
As we have found that the fixed assets contributed a good support to increase the net sales but it is also found that there is no proportionate increase of the fixed assets as to the net sales. Thus the organization can utilized the idle cash with them to increase the fixed assets for the increase of net sales and gaining high return. The organization should trade in such businesses, which have a good return and a healthy margin. The organization perform multi business processes which are nearly interrelated with each other and having similar customer base, of one business activity for other business activities by providing some attractive schemes due to which the customer will be bounded to the organization and will have not for one but for multi facilities.
GLOSSARY
Annual Report: - The report issued annually by a company to its shareholder. It primarily contains financial statements. In addition, it presents the managements view of the operation of the previous years and prospective for future. Balance Sheet: - A summary of firms financial position on a given date that shows Total Assets equal to total liabilities and owners equity. 61 Project Report On Ratio Analysis.
Current Assets: - Assets that normally get converted into cash during the operating cycle of the firm. Current Liabilities: - Liabilities that are payable within a year. Dividend: - Cash distribution of earnings to shareholders, usually or a quarterly basis. Du-pont System: - A system of financial analysis, pioneered by the du-pont company which helps in understanding profitability in terms of profit margin and assets Turnover. Earnings Per Share: - Earning after tax dividend by the number of common share outstanding. Equity: - Debt that cant exchange for another asset. Fixed Assets: - These are tangible long-lived resources ordinarily used for producing other goods and services. Income Statement: - Summary of firms revenue and expenses over a specified period, ending with net income or loss for the period. Leverage Ratio: - The term leverage refers to the ability of a concern to honor its longterm obligation, which indicates a firms ability to meet its long-term borrowings and its interest. Liquidity Ratio: - This ratio finds the liquidity of the firm that refers to the ability of a concern to meet its current obligation as and when they became due.
Profitability Ratio: - It measures the overall efficiency of the business. Trend Analysis: - It shows the changes in the direction of the financial performance over period of years. Turnover Ratio: - This ratio measures the efficiency or effectiveness with which a firm manages its resources or assets.
BIBLIOGRAPHY
Financial Management (9th Edition), I.M.Pandey. Financial Management (5th Edition), Prassana Chandra. Financial Management Dr. S.N.Maheshwari. Annual Report of Raymond LTD., from 2007-08 to 2009-10. www.raymondindia.com www.rayjalgaon.com
Balance Sheet As at 31st March, 2008
Profit And Loss Account For The Year Ended 31st March, 2008
Profit And Loss Account For The Year Ended 31st March, 2009
Profit And Loss Account for the Year Ended 31st Mar 2010

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Jayawant Shikshan Prasarak Mandals

JAYAWANT INSTITUTE OF COMPUTER APPLICATIONS

A 1 Project Report On Ratio Analysis.

PROJECT REPORT ON ANALYSIS OF FINANCIAL STATEMENTS OF RAYMOND LTD. FOR

SUBMITTED BY YOGES H RAMESH PATHAK (BATCH 2010-2012)

JSPMs JAYWANT INSTITUTE OF COMPUTER APPLICATION, PUNE UNIVERSITY

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Place:-Jalgaon Date: / / MBA (FINANCE)

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YOGESH RAMESH PATHAK

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OBJECTIVES OF THE STUDY

2. To help to control: - it is a very useful in controlling the areas of inefficiencies or weakness.

4. To help in evaluation of financial position

5. To find out the Profitability, Liquidity and Solvency position.

6. To study the strengths & weaknesses of the company.

7. To help in determining historical performance as well as current position.

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SCOPE OF THE STUDY

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Few years ago, when 10 Project Report On Ratio Analysis.

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Location of Raymond Ltd in India:-

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1991 - A new manufacturing facility was set up at Chindwara, near Nagpur.

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ABOUT JALGAON UNIT

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ABOUT JALGAON PLANT

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When past Ratio of a Company is taken as a standard for comparison for

The use of predetermined projected ratios as standards to compare the

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a) Current Ratio:It is calculated as:-

b) Liquid /Acid Test / Quick Ratio:It is calculated as:-

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Fixed Asset Turnover Ratio:It is calculated as:-

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Total Assets Turnover Ratio:It is calculated as =

Net sale Total asset

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a) Gross Profit Ratio:It is calculated as:-

b) Net Profit Ratio:It is calculated as:-

5) OVERALL PROFITABILITY RATIOS:-

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Return on Assets:It is calculated as:-

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CALCULATION AND INTERPRETATION

Financial year 2007 2008 2009 2010 2011