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STATEMENTS
Cash Flow Statement
Abstract
The document uses the Cash Flow Statement to compare the companies Asian Paints and
Berger Paints, and draw inferences about the performance on the basis of observations and
understanding from the information provided in the statement.
The working capital changes on other hand shows significant changes and has been reduced
compared to previous year. There is a significant increase in Trade Receivables 240.57
crores (compared to 34.91 crores last year), and increase in inventories 583.97 crores
(compared to reduction in inventory level by 192.06 last year). The company spending on
financial assets has been 192.60 crores (95% more than 98.98 crores last year)
These factors have pulled down the working capital and effected cash inflow.
On brighter side, the company is doing good in trade and other payables which stands at
465.74 crores compared to 98.33 crores last year.
On Investing Activity, the company continues to purchase property, plant and equipment
albeit at the around the same amount as previous year and there seems to be a slowed
down. The company is heavily banking on parking its investment in terms deposits which
stands at 290 crores compared to 70.04 crores the last year.
On Financing Activity, the company is doing good in terms of paying off its borrowing (25.14
crores compared to 7.48 crores the last year). The company continues to reward it
shareholders by paying out regular dividends (913.58 crores compared to 748.66 crores
distributed among shareholders the previous year).
Berger Paints has seen a significant dip in Cash generated from operating activity, falling by
over 37% from 535.55 crores to 338 crores.
The fall is driven primarily due to inventory buildup (197.77 crores compared to 41.72 crores
last year. There company is doing good in trade receivables which has gone down compared
to previous year (20.99 crores vs 27.05 crores last year). However, it has not been able to
utilize suppliers confidence, as its trade payables is down to 93.43 crores against 127.77
crores last year, which means it is supplying suppliers bills faster.
On Investing Activity, the company has invested heavily in purchase of plants, property and
equipment, by spending almost twice the amount compared to last year (247.42 crores vs
105.36 crores). It is also aggressively pumping investment in its subsidiaries and joint
ventures which has increased over 6 times (106.57 crores vs 17.30 crores last year).
To generate fund for these activities the company seems to have disposed of investments
and transfer of a paint division. It is also putting off purchasing of investments compared to
last year (32.88 crores vs 46.17 crores the previous year).
On Financing Activity, the companys short-term borrowings has increased (51.61 crores).
The company has paid dividend to its shareholders, although there does not seems to be a
significant return.
(Source: https://www.asianpaints.com/content/dam/asianpaints/website/secondary-
navigation/investors/financial-results-
2/2016/Asian%20Paints%20Annual%20Report%202016-17.pdf)
Cash flow Statement for Berger Paints for the year ended 31st March 2017
(Source: https://www.bergerpaints.com/upload/investors/annual-reports/ar-16-17.pdf)