Relationship b/w Strategical

performance and Financial analysis:

Such analysis has two components: It provides important evidence of total organizational effectivness. The efficiency and effectivness of the finance function can be assessed in terms of the management of financial resources.

Ratio analysis
Four major areas may be defined as being of particular importance to strategical performance: 1. Is the business profitable? Profitability 2. Is the trading position satisfactory? Trading 3. Is the buisness solvent? Liquidity 4. Are sharholders earning satisfactory return? Shareholders ratios

Profitability
1.Return on capital employed (ROCE):
MAR 05 Return On Capital Employed(% ) Return On Capital Employed(% ) 17.22 MAR 06 17.19 MAR 07 15.99 MAR 08 13.74 MAR 09

Archies
10.19

Vintage
-6.09 -36.97 --44.3 -80.06

2. RETURN ON INVESTMENT OR RETURN ON ASSETS

MAR05
Return on Assets Return on Assets

MAR06 6.63 -19.66

MAR07 6.79 -48.61

MAR08 6.14 -29.38

MAR09 --34.6 Archies Vintage

6.96 -5.77

TRADING POSITION
OPERATING PROFIT MARGIN
MAR 05 MAR 06 MAR 07 MAR 08 MAR 09 Archies
Operating Profit Margin(%) 15.77 15.29 13.95 13.64 8.61

Vintage
Operating Profit Margin(%) -27.35 -86.13 --59.02 -123.68

LIQUIDITY POSITION
CURRENT RATIO
MAR 05 Current Ratio Current Ratio 1.81 0.91 MAR 06 2.05 1.05 MAR 07 1.77 2.67 MAR 08 1.78 1.95 MAR 09 2.47 Archies 1.35 Vintage

QUICK RATIO
MAR 05
Quick Ratio Quick Ratio 1.15 1.48

MAR 06
0.92 1.58

MAR 07
1.03 1.25

MAR 08
1.05 0.84

MAR 09
1.12 0.54

Archies Vintage

Shareholders ratios
Earning per share
Mar 05 Mar 06 Mar 07 Mar 08 Mar 09 Archies Earnings Per Share 9.28 10.32 12.03 12.14 -1.61 Vintage Earnings Per Share -2.34 -6.03 -10.67 -6.64 -9.79

Conclusions and Recommendations

Vintage Survival of the company is at stake. High inventory level Reconsider its unique selling ability and proposition of selling greeting card Archies Company going through a rough patch. Facing a financial crunch. Reconsider moving into new business avenues (Theme and Amusement park, Cakes and confectionaries, Play schools and crech for Children)

SWOT Analysis
STRENGTHS:
 First mover advantage & Few competitors  Tie ups with corporates.  Cards in various regional languages.(Diversified)  Occasion cards launched(Wedding , Festivals , Birthadys)  Emotional & Self Expressive benefit  (People of India associate well with brand image of

ARCHIES)

WEAKNESS:
 Better supplements available .(E-CARDS)  Excess inventory  Continuous need for variety  Margins in gifts were low as they were outsourced.  Expensive promotional activities

OPPORTUNITY:
 New product category  Variety in merchandise industry  Changing Mindset of Indians. (Providing an opportunity for more
occasion cards and gifts.)

 Increasing disposable income of India, providing and opportunity

to expand the markets , and Expand the Product lines in order to become a company that offers complete gifting solutions.

THREATS:
 Growth in Digital media(SMS & MMS culture).  Increase in Social networking websites  Rapid change in demand.  Increase in non branded items.  Low margins in merchandise industry  Political environment. (many shiv sena and Bajrang Dal activists
vandalized many Archies store on the occasions like that of Valentines Day )