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COMPANYS ANALYSIS

FORMULA: QUETTA TEXTILE: 2011 12,049,963,552 14,343,553,424 84 % OF SALES

C.G.S / SALES 2010 7,626,141,053 9,343,111,703 81 % OF SALES

INTERPRETATION: C.G.S has been increased due to increase in the prices of raw material consumed. COLONY TEXTILE: 2011 687,046,107 703,604,102 2010 432,191,417 445,619,746 96.9 % OF SALES

97.6 % OF SALES

INTERPRETATION: C.G.S has been increased due to increase in the cost of raw material.

COMPARISON:

The cost of goods sold ratio of both the companies have been increased due to the inflationary trends. But as C.G.S of colony textile is increasing with the greater proportion than their sales.

FORMULA:

G.P / SALES

QUETTA TEXTILE: 2011 2,293,589,872 14,343,553,424 2010 1,707,970,650 9,343,111,703 18.2 % OF SALES

15.9 % OF SALES

INTERPRETATION: G.P has been decreased due to increased of C.G.S. COLONY TEXTILE: 2011 2010

16,557,995 703,604,102 2.35 % OF SALES

13,428,329 445,619,746
3.0 % OF SALES

INTERPRETATION: G.P has been decreased due to increased of C.G.S.

COMPARISON:

Quetta textile is generating more gross profit by managing its direct expenses, but colony textile is not generating more gross profit due to its inefficiently managed direct cost as compared to the sales generated.

FORMULA:

OPERATING EXP / SALES

QUETTA TEXTILE: 2011 1,403,742,597 14,343,553,424 9.78 % OF SALES 2010 1,281,836,715 9,343,111,703 13.7 % OF SALES

INTERPRETATION: Operating expenses has been decreased due to economies of scale. COLONY TEXTILE: 2011 12,152,476 703,604,102 1.72 % OF SALES 2010 9,365,199 445,619,746 2.1 % OF SALES

INTERPRETATION: Operating expenses has been decreased due to economies of scale.

COMPARISON:

It became evident that both the companies are better able to manage its operations well and having a control on the operational expenses.

FORMULA: QUETTA TEXTILE: 2011 767,996,366 14,343,553,424 5.35 % OF SALES

OPERATING PROFIT / SALES

2010 352,986,835 9,343,111,703 3.78 % OF SALES

INTERPRETATION: Operating profit has been increased as the company is better in the position to control its operating expenses. COLONY TEXTILE: 2011 12,152,476 703,604,102 0.62 % OF SALES 2010 9,365,199 445,619,746 0.91 % OF SALES

INTERPRETATION: Decrease in profit is due to decrease in other income as there is gain on disposal of land has been decrease.

COMPARISON:

By the comparison of both the companies it became clear that quetta textiles performance to generate operating profit is well as compared to that of the colony textile because of the well management of the operations.

FORMULA:

FINANCE COST / SALES

QUETTA TEXTILE: 2011 978,217,081 14,343,553,424 6.8 % OF SALES 2010 962,309,108 9,343,111,703 10.3 % OF SALES

INTERPRETATION: The company is better able to manage its finance cost as compared to its sales. COLONY TEXTILE: 2011 2,394,836 703,604,102 0.34 % OF SALES 2010 13,739,504 445,619,746 3.0 % OF SALES

INTERPRETATION: Due to the grace period of long term loan in this year financial expenses has been decreased.

COMPARISON:

Finance cost of both the companies has been decreased with greater proportion.

FORMULA:

EBT / SALES

QUETTA TEXTILE: 2011 773,468,337 14,343,553,424 5.39 % OF SALES 2010 375,591,335 9,343,111,703 4.02 % OF SALES

INTERPRETATION: EBT has increased due to increase in profit from operation.

COLONY TEXTILE: 2011

13,895,258 703,604,102 0.55 % OF SALES

2010 3,949,898 445,619,746 (0.88) % OF SALES

INTERPRETATION: Earning before tax has been increased due to decrease in the financial exps.

COMPARISON:

Both the companies are in the position to generate more earning before tax as the colony textile is able to overcome to generate profit to overcome its last year loss but the quetta textile is performing well in generating more profit compared to the last year irrespect of the inflationary trend.

FORMULA:

NET PROFIT / SALES

QUETTA TEXTILE: 2011 583,795,450 14,343,553,424 4.07 % OF SALES 2010 255,034,039 9,343,111,703 2.73 % OF SALES

INTERPRETATION: As the profit from operation has been increased in this year which causes the net profit to increase and the taxation is also not having impact on the net profit of this year. COLONY TEXTILE: 2011 168,151 703,604,102 0.02 % OF SALES 2010 6,177,997 445,619,746 (1.38 % ) OF SALES

INTERPRETATION: As the financial expenses has been decreased in this year due to the grace period, so there comes net profit as compared to the last year loss.

COMPARISON:

From the above comparison it became clear that the company quetta textile is generating more net profit with respect of all of its expenses.

BASE 2010

QUETTA TEXTILE

153 % Due to increase in the sales of both local & Export sales ultimately the total sales has been Increased.

INTERPRETATION:

COLONY TEXTILE:

158% Due to increase in the sales of yarn the sales ratio is more as compared to the last year.

INTERPRETATION:

COMPARISON:
By comparing the ratio of both the companies it came to known that the performance of both the companies is good but colony textile is having somehow better position by generating more sales than that of quetta textile.

QUETTA TEXTILE:

158 % Cost has been increased as the cost of raw Material has been increased in this year.

INTERPRETATION:

COLONY TEXTILE
159%

INTERPRETATION:
Cost has been increased as the cost of Raw material has been increased in this year

COMPARISON: By comparison it became clear that both the companies are in the better position and having the same performance.

QUETTA TEXTILE:

134 % Gross profit has been increased due to the Increase in the volume of sales in 2011 as compared To that of 2010 but this increase is lesser than the Increase in the volume of sales.

INTERPRETATION:

COLONY TEXTILE

123% Gross profit has been increased due to the Increase in the volume of sales in 2011 as compared To that of 2010 but this increase is lesser than the Increase in the volume of sales.

INTERPRETATION:

COMPARISON:

The comparison of both the companies shows that gross profit ratio has been well in this year but quetta textile is in the better position to generate more gross profit by generating more sales.

QUETTA TEXTILE:

112 % Due to increase in the sales the selling and Distribution expenses has been Increased which increases the operating expenses.

INTERPRETATION:

COLONY TEXTILE:

126% As the admn expenses such as salaries, wages, benefits, entertainment, repair and Maintenance has been increased which ultimately increased the operating expenses.

INTERPRETATION:

COMPARISON: The comparison shows that both the companies operating expenses has been increased in this year due to increase in the inflationary trend. But colony textile operating expenses are comparittively More than the sales and cost of goods sold.

QUETTA TEXTILE

217 % profit from operations has been increased with greater ratio because relative increase in operating expenses was lesser than the increase In the sales.

INTERPRETATION:

COLONY TEXTILE

108% As the gross profit has been increased with the greater proportion than the expenses so the Operating profit increased.

INTERPRETATION:

COMPARISON: By comparing the ratio of both the companies it came to known that the performance of both the companies is good but quetta textile is having better position by generating more operating profit than that of colony textile by controlling all of its expenses efficiently.

QUETTA TEXTILE

101.6 % The finance cost remains almost same but But this little bit increase is due to the fluctuations in the sources of finance, such as short term finance.

INTERPRETATION:

COLONY TEXTILE

17.4% Due to the grace period of the long tern loan the finance cost has been decreased with the Greater ratio.

INTERPRETATION:

COMPARISON: Both the companies performance related to the interest is somehow better but the colony textile is showing better position due the grace period of the long term loan.

QUETTA TEXTILE:

206 %

INTERPRETATION:
Operating profit is having greater effect On the earnings before tax.

COLONY TEXTILE

108%

INTERPRETATION:
last year there were loss due to increase In the financial expenses, as this year the financial expenses has been decreased so this ratio shows more earnings as compared to the last year loss.

COMPARISON:

By comparing the ratio of both the companies it came to known that the performance of both the companies is good but quetta textile is having better position by generating more operating profit than that of colony textile.

QUETTA TEXTILE:

229 %

INTERPRETATION:
Taxation is not having as much effect on the Profit of this year.

COLONY TEXTILE

2.72%

INTERPRETATION:
This shows that compare to the last year Loss , the net profit has been increased.

COMPARISON: The ratios depicts that the quetta textile is better able to generate the profit with stability and that the colony textile is only able to fulfil its expenses and interest and taxes.

FORMULA:
COLONY 2011 124733433 / 137656431 =0.906

current assets / current liabilities

TEXTILE
2010 92715370 / 158352669 =0.585

INTERPRETATION:

The ratio in both the years is below the standard but relative position got improved due to increase in stock in trade and decrease in trade debts.

QUETTA 2011

TEXTILE
2010 3552358362 / 4069031041 =0.87

4483901522 / 4551382703 =0.98

INTERPRETATION:

The ratio in both the years is below the standard but relative position got improved from previous year due to increase in stock in trade, trade debts, income tax and cash balances.

CO.S

COMPARISON From the comparison of both the co.s in both the years the picture came that the short term financial position of both the co.s is not upto mark but quetta textile in both the years is relatively more stable than colony textile.

FORMULA:
current assets - (inventory + prepaid expenses) / current liabilities

COLONY TEXTILE 2011


124733433 - (15244777 + 89212725 + 6514009) / 137656431 =0.099
2010 92715370 - (13469184 + 39344820 + 7838748) / 158352669 =0.202 INTERPRETATION: As in both the years the acid test ratio is far below the standard as standard is 1:1 and the condition is more worse in the current year due to very high increase in value of stock in trade.

QUETTA

TEXTILE
2011

4483901522 - (449805371 + 294778036 + 645013) / 4551382703

=0.23
2010 3552358362 - (436830375 + 2269203857) / 4069031041

=0.21

INTERPRETATION:

The condition is almost same and is worse in both the years as the ratio is far below the standard 1:1

CO.S

COMPARISON

From the comparison of both the co.s in both the years the picture came that the liquidity position is worse in both the cos and is far be lower the standard but condition in colony textile in current year got worst.

FORMULA:
COLONY
2011 1253111 / 137656431 =0.0091 =0.031

Cash and cash equivalents / current liabilities

TEXTILE
2010 4922670 / 158352669

INTERPRETATION:

The cash ratio is far be lower the standard in both the years as the standard is 0.5:1, co. is lacking with cash and h aving liquidity problem to run its operations and condition is more worse in current year.

QUETTA
2011

TEXTILE
2010 3218580 + 11449354 / 4069031041 =0.036

24661647 + 15898000 / 4551382703 =0.0089

INTERPRETATION:
The ratio in both the years show that co. lacking with cash

and having liquidity problem to run its operations.

CO.S

COMPARISON From the comparison of both the co.s in both the years the picture came that the co.s and facing hyper shortage of cash to run its operations and are on the same level of shortage but if we analyze the situation the condition is worst in 2011 in both the co.s

liquidity

position of both the companies are below the standard. Both the companies are unable to pay its day to day obligations. The company is facing the problems of mismanagement of its current assets.

FORMULA:
COLONY TEXTILE

net credit sales/average debtors outstanding

2011 703604102/12302965 =67.1 INTERPRETATION: The ratio depicts that co. manage to receive its receivables efficiently and having no liquidity problem. QUETTA TEXTILE 2011 14343553424/191229968 =24.26 INTERPRETATION: The ratio depicts that co. manage to receive cash from its debtors in a little bit satisfactory manner and may face liquidity problem.

CO.S

COMPARISON

From the comparison of both the co.s it became evident that quetta textile is efficient enough to receive its collections from the receivables as compared to that of the colony textile which is having collection problem.

FORMULA:
COLONY TEXTILE

net credit purchases / average creditors

2011 =575147653/54937794 =10.47 INTERPRETATION: As co. is not able to fulfill its financial obligations due to liquidity problem. QUETTA TEXTILE 2011 =10143724902/146472696 =69.25

INTERPRETATION: The ratio depicts that co. is able enough to fulfill its financial obligations and having no liquidity problem in this regard.

CO.S

COMPARISION

From the ratios of both the co.s we came to know that quetta textile is in far better position in terms of liquidity to fulfill its financial obligations then colony textile.

Colony is better able to receive its receivables but unable to pay its obligation due to liquidity problem. Quetta is showing some how better performance because the quetta is unable to manage its receivables but able to pay its obligations due to well management of its liabilities.

FORMULA QUETTA TEXTILE Year 2010 2011

gross profit / net sale RATIO 18.3% 15.99%

INTERPRETATION: The G.P ratio has been decreased in 2011 it means the company has not controlled its cost of goods sold and cost of buying an inventory has been increased so this is unfavourable for the company. COLONY TEXTILE Year 2010 2011

RATIO

3.01% 2.35%

INTERPRETATION: The G.P ratio has been decreased in 2011 it means the company has not controlled its cost of goods sold and cost of buying an inventory has been increased so this is unfavourable for the company.

CO.S

COMPARISION

The ratio of both co.s in both the years depict that The G.P ratio has been decreased in 2011in both theco.s it means the co.s have not controlled their cost of goods sold and cost of buying an inventory has been increased so this is unfavourable for the cos but the position of quetta textile is as per ratios is more stable than that of colony textile.

QUETTA TEXTILE Year 2010 2011

AMOUNT(000) 255034/9334111 583795/14343553

RATIO 27.3% 40.7%

INTERPRETATION: The net profit of the company has been increased in 2011 it means the company has controlled its operating expenses and earned operating profit and also reduced its selling expense due to which net profit has been increased COLONY TEXTILE Year 2010 2011 AMOUNT (6177997) /445619746 168151 /703604102 RATIO -1.38% 2.3%

INTERPRETATION: The net profit of the company has been increased in 2011 it means the company has controlled its operating expenses and earned operating profit and also reduced its selling expense due to which net profit has been increased.

CO.S COMPARISION

The ratio of both co.s in both the years depict that The net profit of both the co.s has been increased in 2011 it means the co.s has controlled their operating expenses and earned operating profit and also reduced their selling expense due to which net profit has been increased but the position with regard to stability for quetta textile in both the years was very good as compared to colony textile as it was in negative in 2010 and turned to positive in 2011.

FORMULA QUETTA TEXTILE Year 2011

net profit /avg total assets

AMOUNT
583795/9077453

RATIO
0.64

INTERPRETATION: This indicate that company has earned 0.64 return by utilizingn its assets. This is unfavourable for the company because the return is less as compared to assets. COLONY TEXTILE

Year
2011

AMOUNT
168151 / 10872440

RATIO
1.55

INTERPRETATION: This indicate that company has earned 1.55 return by utilizingn its assets. This is favourable for the company.

CO.S

COMPARISION

The ratio of both the co.s depict that colony textile is earning more return by utilizing its assets and getting mare than the standard ratio of 1:1 but quetta textile is earing return less than 1.

Gross

profit margin of both the companies is low due to inflationary trends but the companies are able to manage its operating expense due to which net profit increased..

FORMULA

debt / equity

COLONY TEXTILE 2011 2010 (164506579+77749659)/73574809 (244720177+51051896)/73574809 =3.29 =4.02 INTERPRETATION: A debt to equity ratio is far away the standard but showing a positive trend toward improvement from last year to current year. QUETTA TEXTILE 2011 8508101764-1536724788/1536724788 =4.54

2010 9646738810-2192119628/2192119628 =3.4

INTERPRETATION: A debt to equity ratio is far away the standard but in this year the company is having more proportion of the debt as compared to the last year.

CO.S

COMPARISON

From the comparison of both the co.s in both the years the picture came that the colony textile is in the better position to control its debt to equity ratio by using relatively less portion of the debt as compared to the equity portion.

FORMULA COLONY TEXTILE 2011 242256238 / 659044875 =0.36

debt /total assets

2010 295772073 / 637589969 =0.46

INTERPRETATION: As in both the years the ratio is below the standard.in 2010 the ratio was around the standard of 0.5 but in current year it was decreased as the asset generation from debt has been reduced because of lack of fully utilization of debts. QUETTA TEXTILE 2011 9646738810 2192119628 / 9646738810 8508101764 =0.77

2010 8508101764 1536724788 /


=0.82

INTERPRETATION: As in both the years the ratio is above the standard but in previous year the condition was more better but still the co. is utilizing its debts efficiently.

CO.S

COMPARISON

From the comparison of both the co.s in both the years the picture came that the quetta textile is utilizing its debts efficiently for asset generation purpose.

FORMULA COLONY TEXTILE 2011 3895258 + 2394836 / 2394836 13739504 =2.62

EBIT/Interest

2010 -3949898 + 13739504 / =0.71

INTERPRETATION: The ratio is better in current year than in previous year as currently co. can pay 2.62 times its interest on debt which previously was just 0.71 times, the condition got improved as co. has taken grace period for payment of longterm debts so in current year co. has apparently reduced its financial cost and has apparently made its position better on the scene but actually not. QUETTA TEXTILE 2011 773468337 + 978217081 / 978217081 962309108 1.79 times

2010 375591535 + 962309108 / 1.39 times

INTERPRETATION: The ratio is better in current year than the previous year , as from previous year the co. can pay for greater times in the current year the interest on its debts.

CO.S

COMPARISON

The comparative analysis show that both the co.s are improving its interest paying ability in the current year than previous year but colony textile is making improvement apparently not actual by taking grace period for long term debts and its finance cost.

This

ratio depict that what is the financial structure of the company. Colony financial structure is in the better position as the company is having more equity than debts and is utilizing its debt more efficiently for asset purpose by generating more EBIT to pay its interest.

FORMULA QUETTA TEXTILE Year 2011

cgs / avg. inventory

AMOUNT 12049963552/2608491.5

RATIO 0.46

INTERPRETATION: The inventory turnover ratio is 0.46. this shows that company is in the stable position.
COLONY TEXTILE

Year 2011

AMOUNT 687046107 / 46578772

RATIO 1.47

INTERPRETATION: The inventory turnover ratio is 1.47. this shows that company is making sales of its goods manufactured with higher degree.

CO.S

COMPARISION

The ratio of both co.s show that colony textile is making sales of its goods manufactured with higher degree as compared to quetta textiles but both are not making even a satisfactory level of sales and having very huge inventories with it.

FORMULA QUETTA TEXTILE Year 2011

net sale / avg. total assets

AMOUNT 14343553/9077453

RATIO 0.157

INTERPRETATION: The total assets turnover ratio is 0.157 it means the company is generating sale from its total assets. This is favourable for the company. COLONY TEXTILE Year 2011 AMOUNT 703604102 / 10872440 RATIO 6.51

INTERPRETATION: The total assets turnover ratio is 6.51 it means the company is generating sale from its total assets. This is favourable for the company. CO.S COMPARISION The ratios of both the co.s show that quetta textile is using its assets more efficiently to generate sales than colony textile.

Colony

textile is showing more favourable position in case of efficiency. The company is utilizing its assets more efficiently to generate more sales but it is unable to manage its inventory for cost of goods sold. Whereas this effect is less as compared to that of the efficiency of asset utilization relatively compared to quetta.

QUETTA TEXTILE Year 2010 2011

AMOUNT 833903442/13583846 157154120/2935355584

RATIO 6.17 0.53

INTERPRETATION: The operating cash flow to the total debt has been decreased in 2011. This shows that cash outflows are greater than cash inflows in 2011. The company payability from operation has been decreased. COLONY TEXTILE Year 2010 2011

AMOUNT (5315847)/429505927 (39327748) /457337799

RATIO -1.23 -0.85

INTERPRETATION: The operating cash flow to the total debt in both years has been negative. The operating cash flow is negative this shows that cash outflows re greater than cash inflows.

CO.S

COMPARISION

The ratio of both co.s in both the years depict that the position of quetta textile is far better than colony textile in both the years and the ratio is in positive and is above the standard but in colony textile the ratio in both the years is in negative which shows outflows are greater than inflows.

QUETTA TEXTILE Year AMOUNT RATIO 2010 833903442/97327606 0.85 2011 833903442/26382597 3.16 INTERPRETATION: The operating cash flow to the current maturities of long term debt and N/P in 2011 has been increased. The operating cash flow is positive this shows that cash inflows are greater than cash outflows. The company is paying its debt from the operations. COLONY TEXTILE Year AMOUNT RATIO 2010 (5315847)/57661402 -0.92 2011 (39327748) /52214185 -0.75 INTERPRETATION: The operating cash flow to the current maturities of long term debt and N/P in both years has been negative. The operating cash flow is negative this shows that cash outflows are greater than cash inflows.

CO.S

COMPARISION

The ratio of both co.s in both the years depict that the operating cash flow to the current maturities of long term debt and N/P in quetta textile in 2011 has been increased than 2010. The operating cash flow is positive this shows that cash inflows are greater than cash outflows. The company is paying its debt from the operations but in case of colony textile the figure comes negative in both the years and shows the weak financial position of co. to fulfill its current obligations from its operations

QUETTA TEXTILE Year 2010 2011

AMOUNT 833903442/51006.8 833903442/87569.25

RATIO 1.63 0.95

INTERPRETATION: The operating cash flow to the cash dividend has been decreased in 2011. So the operating cash flow is positive the company is paynig its dividend from the operations. COLONY TEXTILE Year 2010 2011

AMOUNT (5315847)/0 (39327748) /0

RATIO 0 0

INTERPRETATION: The operating cash flow to the cash dividend in both years has been zero. The operating cash flow is negative this shows that cash outflows are greater than cash inflows. So the operating cash flow is negative the company is not paying its dividend from the operation.

CO.S

COMPARISION

The ratio of both co.s in both the years depict that colony textile has not paid dividend in both theyears but in case of quetta textile The operating cash flow to the cash dividend has been decreased in 2011. So the operating cash flow is positive the company is paynig its dividend from the operations.

The

overall ratios of the quetta textile is more favourable as compared to the colony because of less operating cash flow generated by colony. Due to which the company is unable to pay its dividend and total debt from operation. But the quetta textile is manging its operation efficiently and generating enough operating cash inflows compared to the cash out flows to pay out its dividend and long term debt.