A STUDY ON FINANCIAL PERFORMANCE ANALYSIS OF NUTRO VESSELS

INDO GROUP LIMITED AT SALEM

CHAPTER I
INTRODUCTION TO STUDY
No business can plan its activities without considering its financial resources.
Financial management is that part of management which deals with raising of funds in
the most economical and suitable manner, using the funds as profitability as possible,
planning future operations, inspections, controlling current performance and future
development through financial accounting and other means.
Finance in essence is considered with the acquisition and use of funds by a
business firm. The main objective of financial management is to control required funds
for meeting short term and long-term needs of business enterprise and to maximise the
value of firm to its equity share holders.
To have a clear understanding of the profitability and financial position of
business, the financial statements have to be analysed and interpreted. Financial
statements are prepared for decision making.
They play a dominant role in setting the framework of managerial decisions. But
the information provided by the financial statement is not an end in itself as no
meaningful conclusions can be drawn from these statements alone.
However, the information provided by the financial statement is of immense use
in making decision through analysis and interpretation of financial statement. It helps to
summarise large quantities of financial data and to make quantitative judgement about the
firm’s financial performance.
The study entitled ‘A study on Financial Performance with reference to NUTRO
VESSELS INDO GROUP LIMITED AT SELAM has been oriented with a view to
study the financial position of the company that help in making sound decision by
analyzing the recent trend.
STATEMENT OF THE PROBLEM
 This problem is to find out how the debt and equity affects the financial strength
and weakness of NUTRO VESSELS INDO GROUP LIMITED AT SELAM
 The study of financial performance is composed of the following:
 Analysis of the liquidity between current assets and current liabilities.
 Analysis of liquidity and profitability of current assets and current liabilities.
 Analysis of the long term finance of the firm over a period of time.
 Analysis of various components of working capital e.g. cash.
 Marketable securities receivable and inventories.
 Find out the impact of business fluctuations, technical developments etc., on
financial performance.
NEED FOR THE STUDY
Ratio analysis is an important technique of analyzing the financial statement and
it helps the analyst to make quantitative judgment with regard to concern’s financial
position and performance.
The followings are the main points of importance of ratio analysis:
 Managerial uses of ratio analysis:
 Helps in decision-making
 Helps in financial forecasting and planning
 Helps in communication
 Helps in co-ordination
 Helps in control
 Utility to shareholders/investors:
An investor in the company will like to access the financial position of the
concern where he is going to invest. His first interest will be the security of his
investment and then a return in the form of dividend or interest. For this purpose
 he will try to access the value of fixed assets. Long-term solvency ratios will help
him in accessing financial position of the concern.
Profitability ratios, on the other hand, will be useful to determine the direction of change
and reflects whether the company’s performance and financial position has improved,
deteriorated or remained constant over a period of time, one has to be careful about the
changes, if any, in the firm’s policies and accounting policies.
PROJECTED RATIOS:
Ratios can also be calculated for future standards based upon the projected or
performance financial statement. These future ratios may be taken as standards for
comparisons and the ratios calculated on actual financial statements can be compared
with the standard ratios to find out variances, if any, such variances help in interpreting
and taking corrective action improvement in future.
INTER-FIRM COMPARISON:
 Ratios of one firm can also be compared with the ratios of some other selected
firms in the same industry at the same point of time. This kind of comparison
helps in evaluating relative financial position and performance of the firm.
 Finance is the life blood of the business. It is rightly termed as the science of
money. Finance is very essential for the smooth running business. Finance
Management is that managerial activity which is concerned with the planning and
control of a firm’s financial reserve.
 Financial Management as an academic discipline has undergone fundamental
changes as regards its scope and coverage. In the early years of its evaluation it
was treated synonymously with the raising of funds. In the current literature
pertaining to this growing academic discipline, a broader use of resources is
universally reorganized.
 The published financial statement of a business may of considerable to interest
percent or potential shareholder, bank, financial intuition government,
researchers, trade organization, many other group may be interested in different
aspects of the business and would us like to analyse the financial statement with
their respective purpose in mind.
OBJECTIVE OF THE STUDY
 To analyse the financial strength and weakness of the firm using various
analytical tools like Ratio Analysis, Trend Analysis and Comparative statements.
 To find out how the Debt and Equity affect the financial performance.
 To examine the various components of the financial statements of the company.
 To understand the financial policies and procedures of the company.
 To suggest ways and means to improve the financial performance.
 To decide about the future prospects of the firm.
 To make inter-firm comparison.
 To measure managerial efficiency of the firm.

CHAPTER II

INDUSTRY PROFILE AND COMPANY PROFILE

COMPANY PROFILE

ABOUT NUTRO VESSELS INDO GROUPS LTD:

Nutro Boilers Engineering began manufacturing boilers in Establishment 2002.

The company CEO – G. Perumal Managing Director,- P.Anbhuselvan, As the
demand for boilers grew, Nutro vessels indo groups Ltd was soon in need of a larger
facility.

In 2002. Nutro vessels indo groups Ltd broke ground for a new factory just south
of Los Angeles in an area where orange groves once stood. Just down the street was
Downey’s North American Rockwell plant that built many of the Apollo spacecraft and
another company that made Apollo Motor Homes.

In 2006, Nutro vessels indo groups Ltd opened a second plant in Puerto Rico to
better serve East Coast customers. A few years later, the finished interstate highway
system made this plant obsolete and it closed.
 Much has changed since then. The Apollo factory closed and became a movie studio.
The motor home facility now makes trolley tourist buses. One thing that hasn't changed is
that Nutro vessels indo groups Ltd is still making boilers in Southern California. The
reasons for that can be found in these beliefs that shape our family owned business:

 We believe our boilers and tanks should be built to last.

 We believe boiler maintenance should be simple.
 We believe in treating customers with respect.
 We believe in helping boiler operators and owners understand our products.
 We keep a file on every boiler we've ever built. We may know more about your
Nutro vessels indo groups Ltd than you do.
 We believe in research, development and long term testing.

We recently moved to a new location in nearby Commerce, California. We were

fortunate to find a building twice as large as our former one and yet close enough to
retain all our employees. We have just completed a new R&D lab with full boiler testing
and demonstration capability. We have also added a machine shop to enhance our
manufacturing processes.

From our dependable steam and water boilers to our high efficiency Dura fins,
Nutro vessels indo groups Ltd has boilers for almost every application and budget. Our
dedicated representatives throughout the United States and Canada offer strong local
support while our in-house tech service hot line is ready to answer any questions you
might have. We greatly appreciate your interest in Nutro vessels and look forward to
working together.

MILESTONES:

Year Achievement
2005 Introduced Take-A-Part (Knockdown)
Boilers, Weatherproof Boilers, UL "A"
Labeled Boiler - Burner Packages, Hinged
Head plates.
Introduced Nutro vessels Blow down Tanks
2006 and Condensate Return Tanks.
Shipped 1,100 Oil Fired Domestic Hot
2008 Water Heaters
First Durafin Boilers Ship.
2011

2014 Moved to NEW Location: 5832 Garfield

Avenue, Commerce, CA 90040.

MISSION STATEMENT

 Nutro vessels indo groups Ltd manufactures the worlds largest Scotch marine
firetube boiler. Nutro vessels indo groups Ltd pioneered the first water backed
boiler over 15 years ago and the first packaged boiler over 10 years ago.
 Nutro vessels indo groups Ltd are built to last and carry the only 15-year
warranty in the industry. In addition to the quality and dependability, the
conservative design provides excellent fuel to steam efficiency resulting in the
best life cycle costs in the industry.
 Nutro vessels indo groups Ltd also offers a full line of desecrators, surge tanks
and blow down heat recovery systems.
 These feed water systems are also designed and built to a quality standard which
allows us to offer a 10 year warranty, the only one in the industry.
 Nutro vessels indo groups Ltd is well aware of the changing environmental
requirements.
 While our standard Nutro vessels indo groups Ltd burners can attain less than 30
ppm , we know that some regions of the United States are requiring emissions as
low as 9 PPM.
 High efficiency, availability and low emissions:

VISION STATEMENT
  Nutro vessels indo groups Ltd is recognized as one of the most innovative
biomass boiler suppliers in the world.
 We have a well-known and established reputation for supplying biomass boilers
and combustion systems with exceptionally high efficiencies and availabilities,
high fuel flexibility, and low emission impact.
 Moreover, the systems have very low maintenance costs. The company’s boiler
and combustion system concept is based on more than 30 years of hands-on
experience with steam generation and biomass combustion.

INDUSTRY PROFILE

INTRODUCTION OF THE ORGANIZATION

INTRODUCTION

Nutro vessels indo Company, manufacturer of quality hydronic-heating

products, has introduced more new, high efficiency products over the last several years
than any other company at any time in the history of hydroid heating! From new
ENERGY STAR certified, gas-fired residential boilers… to high efficiency oil-fired
boilers including advanced design, three-pass, cast iron boilers… along with the
industry’s only, three-pass, oil-fired, boiler steam boiler… and the only atmospheric gas
boiler made in India, , the expansive lineup of heating products from Nutro vessels
Company boasts the highest average efficiency, exceeding 85%… with maximum
efficiencies over 95%.

And it doesn’t stop there! Nutro vessels indo groups now offers the broadest line
of condensing boilers available from any manufacturer anywhere. In addition, Nutro
vessels group has developed and introduced exclusive user-friendly boiler control
systems for many of its products. The Nutro vessels indo groups IQ and Nutro groups
Sage2.2 Control Systems offer unparalleled features and benefits that are unmatched in
the boiler industry.

Truly, the nutron vessels indo groups brand has set the new standards for hydronic
heating equipment in residential and commercial product for gas-fired and oil-fired
application with water and boiler steam boiler and super high efficiency condensing
boilers. To provide this extensive product line-up, nutro vessels indo groups has invested
in world class manufacturing facilities and new assembly operations in Lancaster,
Pennsylvania with state-of-the art computer numerical controlled machines providing
exacting product tolerances. Quality, made in India cast iron sections are produced for
Nutro groups by Casting Solutions,. Along with the best engineering capabilities
available anywhere, nutro vessels groups with its made in the India, quality product lines
delivers world-class marketing, technical sales, and sales support unmatched in South
India.

Profile of nutro vessels indo groups ltd:

Nutro vessels indo groups private limited is established at thekkalur, 35 kms

from Salem, the Manchester of south side. The company has carved niche of its own in
the competitive yarn market. The promoter's group of garments embodies the true spirit
of enterprise, a trait the Manchester of south Nutro vessels is well-known for. Our state-
of-art, fully integrated unit is to produce highest quality medium, find and super-fine
count cotton yarn, at par with the best in the world promoted by far sighted visionaries
with technical expertise and impeachable business acumen.

Sales Turnover: 1 million USD

Year Estd : 2005
Main Business Area : Manufacturing and Agent services

Other Area Of Business : Manufacturer of Heat Recovery Boiler

steam Generators (HRSG), Utility Boilers,
Water Tube Boiler and Pressure Vessel.
Share Capital & Number of Employees:

Authorized Capital: 150,000,000

Paid up capital: 9,000,000

Number of Employees: 1800

Nutro vessels Co. is a highly qualified company in design, supplying,

manufacturing, installation and commissioning of different types of heat recovery boiler
steam generators (HRSGs), package, industrial and power plant boilers as well as other
related equipments and accessories in the field of power, oil, gas, petrochemical
industries, power plants and other industrial in domestic and foreign markets.

Relying on the expert human resources, learning and developing technical

knowledge, utilizing maximum production capacity and cooperating with foreign and
domestic suppliers, while observing the shareholders’ rights and gaining customer’s
satisfaction, this company advances toward the sustainable development of society and
aims to realize Iran’s 20-year perspective. In line with the country is policies and
objectives to developer power plans and related technology, the license agreement of
technologies transfer was concluded.

Under this license agreement, over 70 heat recovery boiler steam generators have
been installed and utilized in the downstream of 160 MW gas turbines up to now. The
significant role of oil, gas and petrochemical industries has lead Nutro
vessels and Equipment Co. in to accomplishes several projects for supplying boiler steam
and utilities in the form of EP and EPC for these industries. These boilers were mostly
manufactured by outsourcing and by using the capacity and skills of domestic
subcontractors in the frame work of cohesive management and supervision on suppliers
up to early 2010.
 According to the new perspective of the company since 2010, adjoining a factory
to the company near Tehran, has provided the possibility of manufacturing the main parts
of boiler and other related products. Creating new horizons in fulfilling the customers’
needs and gaining their satisfaction on quality, cost and time.

Nowadays, regarding the actualization of energy costs, while various industries

and investors need increasing efficiency, Nutro vessels and Equipment Co. has focused
on developing products variety in order to design and supply industrial heat recovery
boilers and boiler steam recovery from the wasted heat in industries and also process
packages particularly in oil, gas and petrochemical industries and in the next years, this
company major activities will be devoted to these plans.

Customers’ requirement regarding after sale services in global level as well as

Nutro vessels and Equipment’s commitment to competitor the product and service chain,
has led us to codifying some particular roles since 2010 in the form of customer and after
sale services.

Management’s and personnel’s commitment to fulfil the actual needs of

stakeholders and environmental conservation as well as benefiting from the modern
scientific management systems ensure a prosperous future in achieving the customers’
satisfaction and expanding the company’s contribution to the domestic and foreign
markets.

In many cases, manufacturing facilities provide Boilers are pressure vessels

designed to heat water or produce boiler steam , which can then be used to provide space
heating and/or service water heating to a building. In most commercial building heating
applications, the heating source in the boiler is a natural gas fired burner. Oil fired
burners and electric resistance heaters can be used as well. Boiler steam is preferred over
hot water in some applications, including absorption cooling, kitchens, laundries,
sterilizers, and boiler steam driven equipment.

Boilers have several strengths that have made them a common feature of
buildings. They have a long life, can achieve efficiencies up to 95% or greater, provide
an effective method of heating a building, and in the case of boiler steam systems,
require little or no pumping energy. However, fuel costs can be considerable, regular
maintenance is required, and if maintenance is delayed, repair can be costly.

Guidance for the construction, operation, and maintenance of boilers is provided

primarily by the ASME (American Society of Mechanical Engineers), which produces
the following resources:

 Rules for construction of heating boilers, Boiler and Pressure Vessel Code,
Section IV-2007
 Recommended rules for the care and operation of heating boilers, Boiler and
Pressure Vessel
Boilers are often one of the largest energy users in a building. For every
year a boiler system goes unattended, boiler costs can increase approximately
10% (1). Boiler operation and maintenance is therefore a good place to start when
looking for ways to reduce energy use and save money.

MATERIALS FOR BOILER INDUSTRY:

The pressure vessel of a boiler is usually made of steel (or alloy steel), or
historically of wrought iron. Stainless steel, especially of the austenitic types, is not used
in wetted parts of boilers due to corrosion and stress corrosion cracking. However Nutro
vessels stainless steel is often used in super heater sections that will not be exposed to
boiling water, and electrically-heated stainless steel shell boilers are allowed under the
European "Pressure Equipment Directive" for production of boiler steam for sterilizers
and disinfectors.

In live boiler steam models, copper or brass is often used because it is more easily
fabricated in smaller size boilers. Historically, copper was often used for fireboxes
(particularly forboiler steam locomotives), because of its better formability and higher
thermal conductivity; however, in more recent times, the high price of copper often
makes this an uneconomic choice and cheaper substitutes (such as steel) are used instead.

For much of the Victorian "age of boiler steam ", the only material used for boiler
making was the highest grade of wrought iron, with assembly by riveting. This iron was
often obtained from specialist ironworks, such as at Creator Moor , noted for the high
quality of their rolled plate and its suitability for high-reliability use in critical
applications, such as high-pressure boilers.

In the 20th century, design practice instead moved towards the use of steel, which
is stronger and cheaper, with welded construction, which is quicker and requires less
labour. It should be noted, however, that wrought iron boilers corrode far slower than
their modern-day steel counterparts, and are less susceptible to localized pitting and
stress-corrosion. This makes the longevity of older wrought-iron boilers far superior to
those of welded steel boilers.

Cast iron may be used for the heating vessel of domestic water heaters. Although such
heaters are usually termed "boilers" in some countries, their purpose is usually to produce
hot water, not boiler steam , and so they run at low pressure and try to avoid actual
boiling. The brittleness of cast iron makes it impractical for high-pressure boiler steam
boilers.

CONFIGURATIONS OF BOILER:

Boilers are classified into different types based on their working pressure and
temperature, fuel type, draft method, size and capacity, and whether they condense the
water vapor in the combustion gases. Boilers are also sometimes described by their key
components, such as heat exchanger materials or tube design. These other characteristics
are discussed in the following section on Key Components of Boilers.

Two primary types of boilers include

 Fire Tube Boiler

 Cast iron sectional

Fire Tube Boiler:

In a Fire tube boiler, hot gases of combustion flow through a series of tubes
surrounded by water. Alternatively, in a Water tube boiler, water flows in the inside of
the tubes and the hot gases from combustion flow around the outside of the tubes. A
drawing of a water tube boiler is shown in Figure

Fire tube boilers are more commonly available for low pressure boiler steam or
hot water applications, and are available in sizes ranging from 500,000 to 75,000,000
BTU input. Water tube boilers are primarily used in higher pressure boiler steam
applications and are used extensively for comfort heating applications. They typically
range in size from 500,000 to more than 20,000,000 BTU input.

Cast Iron Sectional Boilers:

Cast iron sectional boilers are another type of boiler commonly used in
commercial space heating applications. These types of boilers don’t use tubes. Instead,
they’re built up from cast iron sections that have water and combustion gas passages. The
iron castings are bolted together, similar to an old boiler steam radiator. The sections are
sealed together by gaskets. They’re available for producing boiler steam or hot water,
and are available in sizes ranging from 35,000 to 14,000,000 BTU input.
 Cast iron sectional boilers are advantageous because they can be assembled on
site, allowing them to be transported through doors and smaller openings. Their main
disadvantage is that because the sections are sealed together with gaskets, they are prone
to leakage as the gaskets age and are attacked by boiler treatment chemicals.

Water-tube boiler:

In this type, tubes filled with water are arranged inside a furnace in a number of
possible configurations. Often the water tubes connect large drums, the lower ones
containing water and the upper ones boiler steam and water; in other cases, such as a
mono-tube boiler, water is circulated by a pump through a succession of coils.

This type generally gives high boiler steam production rates, but less storage
capacity than the above. Water tube boilers can be designed to exploit any heat source
and are generally preferred in high-pressure applications since the high-pressure
water/boiler steam is contained within small diameter pipes which can withstand the
pressure with a thinner wall.
THE USE OF BOILER SYSTEMS IN PRACTICE

Industrial hot water boiler systems for generating thermal heat are very
similar to the household heating boilers in our cellars. The main difference is that
industrial boilers are dimensioned significantly larger, so their heating capacity is not
only sufficient for a family home but also for hotels, hospitals, skyscrapers, industrial
buildings or entire districts. When using process heat generated by boiler steam boiler
systems the individual applications are far more versatile. They are used in many industry
sectors. But is all this just hot air or what exactly is the boiler steam used for Let us
choose a few industrial sectors and have a closer look at them.

SAFETY ISSUES IN MANUFACTURING OF BOILER:

All combustion equipment must be operated properly to prevent dangerous

conditions or disasters from occurring, causing personal injury and property loss. The
basic cause of boiler explosions is ignition of a combustible gas that has accumulated
within the boiler. This situation could arise in a number of ways, for example fuel, air, or
ignition is interrupted for some reason, the flame extinguishes, and combustible gas
accumulates and is reignited. Another example is when a number of unsuccessful
attempts at ignition occur without the appropriate purging of accumulated combustible
gas.

There is a tremendous amount of stored energy within a boiler. The state change
of superheated water from a hot liquid to a vapour releases an enormous amount of
energy. For example, 1 ft3 of water will expand to 1600 ft3 when it turns to boiler steam

Therefore, “if you could capture all the energy released when a 30 gallon home
hot water tank flashes into explosive failure at 332o F, you would have enough force to
send the average car to a height of nearly 125 feet. This is equivalent to more than the
height of a 14 story apartment building, starting with a lift off velocity of 85 miles per
hour.

Boiler safety is a key objective of the National Board of Boiler and Pressure
Vessel Inspectors. This organization reports and tracks boiler safety and the number of
incidents related to boilers and pressure vessels each year.

Their work has found that the number one incident category resulting in injury
was poor maintenance and operator error. This stresses the importance of proper
maintenance and operator training. Boilers must be inspected regularly based on
manufacturer’s recommendations. Pressure vessel integrity, checking of safety relief
valves, water cut-off devices and proper float operation, gauges and water level indicators
should all be inspected.

BEST PRACTICES FOR EFFICIENT OPERATION:

EFFICIENCY

The percentage of the heat energy contained in the fuel that is captured by the
working fluid in the boiler is defined as the combustion efficiency of the boiler.
Combustion efficiencies of 80% or higher are usually possible for hot water boilers and
low pressure boiler steam boilers for commercial buildings.

Complete combustion results when a hydrocarbon fuel such as natural gas or oil
burns and produces only carbon dioxide, water and heat. If there is insufficient oxygen
and/or poor mixing of fuel and oxygen, then incomplete combustion will occur resulting
in other products of combustion including carbon monoxide and unburned fuel.

When incomplete combustion occurs, the chemical energy of the fuel is not
completely released as heat and the combustion efficiency is reduced. This is also a
safety concern as unburned fuel could ignite in the stack and cause an explosion. Boilers
must be tuned to achieve complete combustion. One strategy to ensure complete
combustion is to provide some amount of excess air. However, as shown in the figure
below, a small amount of excess air will improve combustion efficiency, but a large
amount will reduce efficiency.

Use Boiler Controls for Optimized Air-to-Fuel Ratio

To ensure that complete combustion occurs, extra air is introduced at the burner.
But too much will result in air being wastefully heated and exhausted out of the boiler
flue, penalizing combustion efficiency, and creating a safety issue. When a boiler is
tuned, the goal is to maximize combustion efficiency by providing just enough excess air
to assure complete combustion but not too much to reduce efficiency.

How much excess air is enough to assure complete combustion? That varies with
the design and condition of the burner and boiler, as well as with the different firing rates
of the burner, but is typically considered to be between 2% - 3%. Excess air must also be
adjusted to allow for variations in temperature, density, and humidity of the boiler
combustion air throughout any daily and seasonal variations. It’s desirable to maintain a
constant amount of excess air across the entire firing range.

The important idea to remember is that complete combustion is critical to

ensuring efficient boiler operation. Incomplete combustion of the fuel can significantly
reduce boiler efficiency by 10% or more, while increasing excess air by 10% may only
impact boiler efficiency by about 1%. Signs of incomplete combustion are a smoky
exhaust, a yellow flame, flame failures, and sooty boiler tubes. It is a good idea to tune up
a boiler annually to ensure the combustion process is optimized.

SUPERHEATED BOILER STEAM BOILERS:

Most boilers produce boiler steam to be used at saturation temperature; that is,
saturated boiler steam. Superheated boiler steam boilers vaporize the water and then
further heat the boiler steam in a super heater.

This provides boiler steam at much higher temperature, but can decrease the
overall thermal efficiency of the boiler steam generating plant because the higher boiler
steam temperature requires a higher flue gas exhaust temperature. There are several ways
to circumvent this problem, typically by providing an economizer that heats the feed
water, a combustion air heater in the hot flue gas exhaust path, or both.

There are advantages to superheated boiler steam that may, and often will,
increase overall efficiency of both boiler steam generation and its utilization: gains in
input temperature to a turbine should outweigh any cost in additional boiler complication
and expense. There may also be practical limitations in using wet boiler steam, as
entrained condensation droplets will damage turbine blades.
Superheated boiler steam presents unique safety concerns because, if any system
component fails and allows boiler steam to escape, the high pressure and temperature can
cause serious, instantaneous harm to anyone in its path. Since the escaping boiler steam
will initially be completely superheated vapour, detection can be difficult, although the
intense heat and sound from such a leak clearly indicates its presence.

ORGANIZATION CHAT
 CHAPTER III
RESEARCH METHODOLOGY
RESEARCH DESIGN
The study is partly descriptive and partly analytical. It is descriptive as it traces
theoretical frame work of financial management. It is analytical in the sense that it makes
an appraisal of the financial management in NUTRO VESSELS INDO GROUP
LIMITED AT SALEM
A Research Design is needed because it felicitates the smooth sailing of the
various research operations. There by making research as efficient as possible yielding
maximum information with minimum expenditure.
The study is primarily based on the internal records and annual accounts of the
company. Besides this, information will be gathered through discussion with the officers
of the company. Further personal interview will be held with various personnel working
in the company.

TYPE OF RESEARCH
DESCRIPTIVE RESEARCH
The study is primarily based on the internal records and the annual records of the
company. Besides, information is gathered through discussions held with the officers of
the company.
UNIVERSE
The entire financial data of the company is considered as the universe of data.
SAMPLE SIZE
Financial data which is relevant to 5 years is taken as the sample size.
SAMPLE METHOD
Convenience sampling method is used to collect data for the study.
PERIOD OF STUDY
The study was conducted for three months.
DATA COLLECTION
The data for the study are to be collected from secondary and primary sources.
The study mainly depends on secondary data.

SOURCES
The primary data have to be collected with the help of informal discussion with
Account Officers.

SECONDARY DATA
 Annual Report of NUTRO VESSELS INDO GROUP LIMITED AT SALEM
 Informal discussion with Account Officers
 Company Website
 Journals and Magazines

TOOLS OF ANALYSIS
 Ratio Analysis
 Trend Analysis
 Comparative Statements
 Common Size Statements

LIMITATIONS OF THE STUDY

 The period of study is limited to data of 5 years
 The study is based on secondary data provided by the unit.
 It is difficult to judge the financial strength and weakness with the said ratios.
 CHAPTER IV
DATA ANALYSIS AND INTERPRETATION

RATIO ANALYSIS

COMPARITIVE FINANCIAL STATEMENTS

Comparative financial statements are ones, which have been prepared in a systematic
manner and provides statistical information about a particular event (financial
transaction) or aspect, taking place on different dates or during different periods.
The comparative financial statements are chalked out in a columnar form (in majority of
the cases). One is also able to view comparative accounts of different companies.

Comparative financial statements, like all other financial statements have the following
types of financial statements:
 Income statements
 Balance sheet

Income statements:
Also known as profit and loss financial statement, these types of comparative financial
statements suggest profit amount earned by a company as well as amount of money lost
by a company. Loss or profit may not always mean, loss or profit of money, it may also
include any asset or stock, which has an economic value. Income statements also include
expenditure incurred for conducting activities, related to operations. This type of a
financial statement is referred to as an operating financial statement.

Balance sheet:
Information pertaining to expenses and profit earned by a company are recorded in the
balance sheet.
 TABLE NO: 1
COMPARATIVE BALANCE SHEET FOR THE YEAR OF 2012-2013
Increase Increase
PARTICULARS 2012 2013 or Decrease or Decrease
(Amount) (Percentage)
ASSETS
Fixed Assets:
Net Block 553851 527947 -25904 -4.68
Capital Work in Progress 2870 2090 -780 -27.18
Current Assets:
Inventories 387717 378623 -9094 -2.35
Sundry Debtors 72097 71838 -259 -0.36
Cash and Bank Balances 10794 11041 247 2.29
Loans and Advances 53826 64067 10241 19.03
Investments 2739 2588 -151 -5.51
Miscellaneous Expenses 298 149 -149 -50.00
Profit and Loss Account 33384 74138 40754 122.08
TOTAL ASSETS 1117576 1132481 14905 1.33
LIABILITIES
Share Capital:
Equity 84873 84873 0 0
Preference 46000 46000 0 0
Reserves and Surplus 41296 41296 0 0
Secured Loan:
Term Loans 449763 503717 53954 12.00
Others 253798 240060 -13738 -5.41
Unsecured Loan 6784 6808 24 0.35
Current Liabilities 199897 174234 -25663 -12.84
Provisions 33328 35493 2165 6.50
Deferred Tax Liability 1837 0 -1837 -100.00
TOTAL LIABILITIES 1117576 1132481 14905 1.33

Table No: 2
COMPARATIVE BALANCE SHEET FOR THE YEAR OF 2013-2014
Increase Increase
PARTICULARS 2013 2014 or Decrease or Decrease
(Amount) (Percentage)
ASSETS
Fixed Assets:
Net Block 527947 477999 -49948 -9.46
Capital Work in Progress 2090 40153 38063 1821.20
Current Assets:
Inventories 378623 366324 -12299 -3.25
Sundry Debtors 71838 80975 9137 12.72
Cash and Bank Balances 11041 11930 889 8.05
Loans and Advances 64067 37054 -27013 -42.16
Investments 2588 3611 1023 39.53
Miscellaneous Expenses 149 0 -149 -100.00
Profit and Loss Account 74138 52285 -21853 -29.48
TOTAL ASSETS 1132481 1070331 -62150 -5.49
LIABILITIES
Share Capital:
Equity 84873 84873 0 0.00
Preference 46000 46000 0 0.00
Reserves and Surplus 41296 41296 0 0.00
Secured Loan:
Term Loans 503717 341188 -162529 -32.27
Others 240060 243361 3301 1.38
Unsecured Loan 6808 10509 3701 54.36
Current Liabilities 174234 249398 75164 43.14
Provisions 35493 53706 18213 51.31
Deferred Tax Liability
TOTAL LIABILITIES 1132481 1070331 -62150 -5.49

TABLE NO: 3
COMPARATIVE BALANCE SHEET FOR THE YEAR OF 2014-2015
Increase Increase
PARTICULARS 2015 2016 or Decrease or Decrease
(Amount) (Percentage)
ASSETS
Fixed Assets:
Net Block 477999 494547 16548 3.46
Capital Work in Progress 40153 0 -40153 -100.00
Current Assets:
Inventories 366324 383094 16770 4.58
Sundry Debtors 80975 83306 2331 2.88
Cash and Bank Balances 11930 13424 1494 12.52
Loans and Advances 37054 46674 9620 25.96
Investments 3611 5631 2020 55.94
Miscellaneous Expenses 0
Profit and Loss Account 52285 0 -52285 -100.00
TOTAL ASSETS 1070331 1026676 -43655 -4.08
LIABILITIES
Share Capital:
Equity 84873 84873 0 0.00
Preference 46000 138327 92327 200.71
Reserves and Surplus 41296 41720 424 1.03
Secured Loan:
Term Loans 341188 241060 -100128 -29.35
Others 243361 23985 -219376 -90.14
Unsecured Loan 10509 23904 13395 127.46
Current Liabilities 249398 196773 -52625 -21.10
Provisions 53706 60634 6928 12.90
Deferred Tax Liability
TOTAL LIABILITIES 1070331 1026676 -43655 -4.08

TABLE NO: 4
COMPARATIVE BALANCE SHEET FOR THE YEAR OF 2015-2016
Increase Increase
PARTICULARS 2015 2016 or Decrease or Decrease
(Amount) (Percentage)
ASSETS
Fixed Assets:
Net Block 494547 450754 -43793 -8.86
Capital Work in Progress 0 3456 3456 100.00
Current Assets:
Inventories 383094 424145 41051 10.72
Sundry Debtors 83306 97695 14389 17.27
Cash and Bank Balances 13424 29272 15848 118.06
Loans and Advances 46674 42515 -4159 -8.91
Investments 5631 5632 1 0.02
Miscellaneous Expenses
Profit and Loss Account 0
TOTAL ASSETS 1026676 1053469 26793 2.61
LIABILITIES
Share Capital:
Equity 84873 84873 0 0.00
Preference 138327 138327 0 0.00
Reserves and Surplus 41720 84488 42768 102.51
Secured Loan:
Term Loans 241060 241729 669 0.28
Others 239385 238286 -1099 -0.46
Unsecured Loan 23904 19635 -4269 -17.86
Current Liabilities 196773 186623 -10150 -5.16
Provisions 60634 59508 -1126 -1.86
Deferred Tax Liability
TOTAL LIABILITIES 1026676 1053469 26793 2.61

TABLE NO: 5
COMPARATIVE BALANCE SHEET FOR THE YEAR OF 2016-2017
Increase Increase
PARTICULARS 2016 2017 or Decrease or Decrease
(Amount) (Percentage)
ASSETS
Fixed Assets:
Net Block 450754 415081 -35673 -7.91
Capital Work in Progress 3456 0 -3456 -100.00
Current Assets:
Inventories 424145 417870 -6275 -1.48
Sundry Debtors 97695 112722 15027 15.38
Cash and Bank Balances 29272 47558 18286 62.47
Loans and Advances 42515 47589 5074 11.93
Investments 5632 5632 0 0.00
Miscellaneous Expenses
Profit and Loss Account
TOTAL ASSETS 1053469 1046452 -7017 -0.67
LIABILITIES
Share Capital:
Equity 84873 84873 0 0.00
Preference 138327 138327 0 0.00
Reserves and Surplus 84488 121790 37302 44.15
Secured Loan:
Term Loans 241729 234704 -7025 -2.91
Others 238286 235082 -3204 -1.34
Unsecured Loan 19635 18256 -1379 -7.02
Current Liabilities 186623 145105 -41518 -22.25
Provisions 59508 51316 -8192 -13.77
Deferred Tax Liability 16999 16999 100.00
TOTAL LIABILITIES 1053469 1046452 -7017 -0.67

TABLE NO: 6
COMPARATIVE INCOME STATEMENT FOR THE YEAR OF 2012-2013
Increase Increase
PARTICULARS 2012 2013 or Decrease or Decrease
(Amount) (Percentage)
INCOME
Sales 491595 499305 7710 1.57
Other Income 4966 91193 86227 1736.35
Deferred Tax Liability 11763 1837 -9926 -84.38
Increase/Decrease in Stock 49315 -4114 -53429 -108.34
TOTAL INCOME 557639 588221 30582 5.48
EXPENDITURE
Purchase of Finished Goods 1231 752 -479 -38.91
Material consumed 126652 14135 -112517 -88.84
Power And Fuel 112466 128447 15981 14.21
Salaries, Wages and Bonus 85381 78030 -7351 -8.61
Repairs and Maintenance 15955 21169 5214 32.68
Insurance 2425 2579 154 6.35
Travelling Expenses 3476 3635 159 4.57
Miscellaneous Expenses 8743 4933 -3810 -43.58
Packing and Forwarding 25494 25812 318 1.25
Commission and Discount 11533 8095 -3438 -29.81
Advertisement Expenses 496 489 -7 -1.41
Research and Development 219 196 -23 -10.50
Interest on Fixed Assets 48005 61650 13645 28.42
Interest on other loans 38001 31470 -6531 -17.19
Excise Duty 55464 54277 -1187 -2.14
Prior Period Adjustment 630 428 -202 -32.06
Bad And DD Written off 397 0 -397 -100.00
Provision for Doubtful Debts 2237 2375 138 6.17
Provision for Taxation 0 0 0
Depreciation 0 41764 41764 100.00
Other Expenditure 18102 21518 3416 18.87
TOTAL EXPENDITURE 556907 628975 72068 12.94
PROFIT AND LOSS ACCOUNT 732 -40754 -41486 -5667.49

TABLE NO: 7
COMPARATIVE INCOME STATEMENT FOR THE YEAR OF 2013-2014
 Increase Increase
PARTICULARS 2013 2014 or Decrease or Decrease
(Amount) (Percentage)
INCOME
Sales 499305 858160 358855 71.87
Other Income 91193 1519886 1428693 1566.67
Deferred Tax Liability 1837 0 -1837 -100.00
Increase/Decrease in Stock -4114 -25403 -21289 517.48
TOTAL INCOME 588221 984743 396522 67.41
EXPENDITURE
Purchase of Finished Goods 752 1297 545 72.47
Material consumed 14135 229678 215543 1524.89
Power And Fuel 128447 153703 25256 19.66
Salaries, Wages and Bonus 78030 143519 65489 83.93
Repairs and Maintenance 21169 27879 6710 31.70
Insurance 2579 6108 3529 136.84
Travelling Expenses 3635 5938 2303 63.36
Miscellaneous Expenses 4933 11049 6116 123.98
Packing and Forwarding 25812 65560 39748 153.99
Commission and Discount 8095 13564 5469 67.56
Advertisement Expenses 489 935 446 91.21
Research and Development 196 464 268 136.73
Interest on Fixed Assets 61650 60659 -991 -1.61
Interest on other loans 31470 5654 -25816 -82.03
Excise Duty 54277 99601 45324 83.50
Prior Period Adjustment 428 47 -381 -89.02
Bad And DD Written off 0 33015 33015 100.00
Provision for Doubtful Debts 2375 16052 13677 575.87
Provision for Taxation 0 1246 1246 100.00
Depreciation 41764 65721 23957 57.36
 Other Expenditure 21518 21201 -317 -1.47
TOTAL EXPENDITURE 628975 962890 333915 53.09
PROFIT AND LOSS ACCOUNT -40754 21853 62607 -153.62

TABLE NO: 8
COMPARATIVE INCOME STATEMENT FOR THE YEAR OF 2014-2015
Increase Increase
PARTICULARS 2014 2015 or Decrease or Decrease
(Amount) (Percentage)
INCOME
Sales 858160 328091 -530069 -61.77
Other Income 1519886 25500 -1494386 -98.32
Deferred Tax Liability 0 9134 9134 100.00
Increase/Decrease in Stock -25403 20466 45869 -180.57
TOTAL INCOME 984743 383191 -601552 -61.09
EXPENDITURE
Purchase of Finished Goods 1297 310 -987 -76.10
Material consumed 229678 95400 -134278 -58.46
Power And Fuel 153703 54302 -99401 -64.67
Salaries, Wages and Bonus 143519 47949 -95570 -66.59
Repairs and Maintenance 27879 9558 -18321 -65.72
Insurance 6108 2169 -3939 -64.49
Travelling Expenses 5938 1257 -4681 -78.83
Miscellaneous Expenses 11049 1665 -9384 -84.93
Packing and Forwarding 65560 23321 -42239 -64.43
Commission and Discount 13564 5571 -7993 -58.93
Advertisement Expenses 935 405 -530 -56.68
Research and Development 464 130 -334 -71.98
Interest on Fixed Assets 60659 1899 -58760 -96.87
Interest on other loans 5654 18896 13242 234.21
Excise Duty 99601 37338 -62263 -62.51
Prior Period Adjustment 47 -1748 -1795 -3819.15
Bad And DD Written off 33015 56 -32959 100.00
Provision for Doubtful Debts 16052 0 -16052 -100.00
Provision for Taxation 1246 2956 1710 100.00
Depreciation 65721 22500 -43221 -65.76
Other Expenditure 21201 6548 -14653 -69.11
TOTAL EXPENDITURE 962890 330482 -632408 -65.68
PROFIT AND LOSS
ACCOUNT 21853 52709 30856 141.20

TABLE NO: 9
COMPARATIVE INCOME STATEMENT FOR THE YEAR OF 2015-2016
Increase Increase
PARTICULARS 2015- 2016 or Decrease or Decrease
(Amount) (Percentage)
INCOME
Sales 328091 719255 391164 119.22
Extra Ordinary Income 25500 0 -25500 -100.00
Deferred Tax Liability 9134 1282 -7852 -85.96
Increase/Decrease in Stock 20466 21001 535 2.61
TOTAL INCOME 383191 741538 358347 93.52
EXPENDITURE
Purchase of Finished Goods 310 797 487 157.10
Material consumed 95400 205950 110550 115.88
Power And Fuel 54302 109582 55280 101.80
Salaries, Wages and Bonus 47949 83183 35234 73.48
Repairs and Maintenance 9558 20013 10455 109.38
Insurance 2169 4510 2341 107.93
Travelling Expenses 1257 4253 2996 238.35
Miscellaneous Expenses 1665 3513 1848 110.99
Packing and Forwarding 23321 39742 16421 70.41
Commission and Discount 5571 15179 9608 172.46
Advertisement Expenses 405 1177 772 190.62
Research and Development 130 315 185 142.31
Interest on Fixed Assets 1899 21602 19703 1037.55
Interest on other loans 18896 36289 17393 92.05
Excise Duty 37338 82069 44731 119.80
Prior Period Adjustment -1748 1447 3195 -182.78
Bad And DD Written off 56 2466 2410 100.00
Provision for Doubtful Debts 0 0 0 0.00
Provision for Taxation 2956 5630 2674 100.00
Depreciation 22500 46607 24107 107.14
Other Expenditure 6548 14446 7898 120.62
TOTAL EXPENDITURE 330482 698770 368288 111.44
PROFIT AND LOSS
ACCOUNT 52709 42768 -9941 -18.86

TABLE NO: 10
COMPARATIVE INCOME STATEMENT FOR THE YEAR OF 2016-2017
 Increase Increase
PARTICULARS 2016 2017 or Decrease or Decrease
(Amount) (Percentage)
INCOME
Sales 719255 816052 96797 13.46
Other Income 1282 7702 6420 500.78
Increase/Decrease in Stock 21001 -4522 -25523 -121.53
TOTAL INCOME 741538 741538 77694 10.48
EXPENDITURE
Purchase of Finished Goods 797 1037 240 30.11
Material consumed 205950 246220 40270 19.55
Power And Fuel 109582 123158 13576 12.39
Salaries, Wages and Bonus 83183 96317 13134 15.79
Repairs and Maintenance 20013 22732 2719 13.59
Insurance 4510 3112 -1398 -31.00
Travelling Expenses 4253 3586 -667 -15.68
Miscellaneous Expenses 3513 4482 969 27.58
Packing and Forwarding 39742 51182 11440 28.79
Commission and Discount 15179 13026 -2153 -14.18
Advertisement Expenses 1177 2116 939 79.78
Research and Development 315 258 -57 -18.10
Interest on Fixed Assets 21602 23037 1435 6.64
Interest on other loans 36289 32629 -3660 -10.09
Excise Duty 82069 61850 -20219 -24.64
Prior Period Adjustment 1447 3534 2087 144.23
Bad And DD Written off 2466 0 -2466 100.00
Provision for Doubtful Debts 0 10123 10123 0.00
Provision for Taxation 5630 22732 17102 100.00
Depreciation 46607 46599 -8 -0.02
Extra Ordinary Expenses 9964
 Other Expenditure 14446 15702 1256 8.69
TOTAL EXPENDITURE 698770 793396 94626 13.54
PROFIT AND LOSS
ACCOUNT 42768 25836 -16932 -39.59

COMMON SIZE FINANCIAL STATEMENTS

Common size ratios are used to compare financial statements of different-size companies
or of the same company over different periods. By expressing the items in proportion to
some size-related measure, standardized financial statements can be created, revealing
trends and providing insight into how the different companies compare.

The ratios often are expressed as percentages of the reference amount. Common size
statements usually are prepared for the income statement and balance sheet, expressing
information as follows:

 Income statement items - expressed as a percentage of total revenue

 Balance sheet items - expressed as a percentage of total assets
 The common-size statement is a financial document that is often utilized as a
quick and easy reference for the finances of a corporation or business. Unlike balance
sheets and other financial statements, the common-size statement does not reflect exact
figures for each line item. Instead, the structure of the common size statement uses a
common base figure, and assigns a percentage of that figure to each line item or category
reflected on the document.
 A company may choose to utilize financial statements of this type to present a
quick snapshot of how much of the company’s collected or generated revenue is going
toward each operational function within the organization. The use of a common-size
statement can make it possible to quickly identify areas that may be utilizing more of the
operating capital than is practical at the time, and allow budgetary changes to be
implemented to correct the situation.
 The common size statement can also be a helpful tool in comparing the financial
structures and operation strategies of two different companies. The use of percentages in
 the common size statements removes the issue of which company generates more
revenue, and brings the focus on how the revenue is utilized within each of the two
businesses. Often, the use of a common-size statement in this manner can help to identify
areas where each company is utilizing resources efficiently, as well as areas where there
is room for improvement.
 Common-size statements can be prepared for any review period desired.
Companies that choose to make use of financial statements of this type may choose to
utilize this format for quarterly, semi-annual, or annual reviews. When there is concern
about operational costs, the common-size statement may be prepared on a more frequent
basis, such as monthly. Because the common-size statement is very easy to read and does
not necessarily contain information that would be considered proprietary, the format can
often be employed as part of general information that is released to the public.

COMMON SIZE BALANCE SHEET 2012-2017

Table No: 11

Particulars 2012-13 % 2013-14 % 2014-15 % 2015-

ASSETS:
Fixed Assets:
Net Block 527947 47% 477999 45% 494547 48% 4507
Capital Work in Progress 2090 0.18% 40153 4% 0 0% 34

Current Assets:
Inventories 378623 33.43% 366324 34% 383094 37% 4241
Sundry Debtors 71838 6% 80975 8% 83306 8% 976
Cash and Bank Balances 11041 1% 11930 1% 13424 1% 292
Loans and Advances 64067 6% 37054 3% 46674 5% 425
Investments 2588 1% 3611 0.34% 5631 1% 56
Miscellaneous Expenditure 149 0.01% 0 0% 0 0%
Profit and Loss Account 74138 7% 52285 5% 0 0%

TOTAL ASSETS 1132481 100% 1070331 100% 1026676 100% 10534

LIABILITIES:
Share Capital:
Equity 84873 7% 84873 8% 84873 8% 848
 Preference 46000 4% 46000 4% 138327 13% 1383
Reserves and Surplus 41296 4% 41296 4% 41720 8% 844
Secured Loan:
Term Loans 503717 44% 341188 32% 241060 23% 2417
Others 240060 21% 243361 23% 239385 22% 2382

Unsecured Loans 6808 1% 10509 1% 23904 2% 196

Deferred Tax Payments 0 0% 0 0% 0 0%
Current Liabilities 174234 15% 249398 23% 196773 19% 1866
Provisions 35493 3% 53706 5% 60634 6% 595

TOTAL LIABILITIES 1132481 100% 1070331 100% 1026676 100% 10534

COMMON SIZE INCOME STATEMENT 2012-2017

TABLE NO: 12

2013- 2014- 2015- 2016-

Particulars 2012-13 % % % %
14 15 16 17
INCOME
Sales 499305 84.88% 858160 87% 328091 86% 7E+05 97% 81605
Extra Ordinary Income 0 0.00% 0% 25500 7% 0 0%
Other Income 91193 15.50% 2E+06 15% 9134 2% 1282 0.17% 770
Deferred Tax Liability 1837 0.31% 0 0% 0 0% 0 0%
Increase/Decrease in Stock -4114 -1% -25403 -2% 20466 5% 21001 3% -452
TOTAL INCOME 588221 100% 984743 100% 383191 100% 7E+05 100% 74153
EXPENDITURE
Purchase of Finished
Goods 752 0.12% 1297 0.13% 310 0.10% 797 0.11% 103
Material consumed 14135 23% 229678 24% 95400 29% 2E+05 29% 24622
Power And Fuel 128447 20% 153703 16% 54302 16% 1E+05 16% 12315
Salaries, Wages and Bonus 78030 12% 143519 15% 47949 14% 83183 12% 9631
Repairs and Maintenance 21169 3% 27879 3% 9558 3% 20013 3% 2273
Insurance 2579 0.41% 6108 1% 2169 1% 4510 1% 311
Travelling Expenses 3635 1% 5938 1% 1257 0.48% 4253 1% 358
Miscellaneous Expenses 4933 1% 11049 1% 1665 1% 3513 1% 448
Packing and Forwarding 25812 4% 65560 7% 23321 7% 39742 6% 5118
Commission and Discount 8095 1% 13564 1% 5571 2% 15179 1% 1302
Advertisement Expenses 489 0.05% 935 0.05% 405 0.22% 1177 0.12% 211
Research and Development 196 0.03% 464 0.05% 130 0.04% 315 0.04% 25
Interest on Fixed Assets 61650 10% 60659 6% 1899 1% 21602 3% 2303
Interest on other loans 31470 5% 5654 1% 18896 6% 36289 5% 3262
Excise Duty 54277 9% 99601 10% 37338 11% 82069 12% 6185
Prior Period Adjustment 428 0.06% 47 0.01% -1748 -1% 1447 0.08% 353
Bad And DD Written off 0 0% 33015 300% 56 0.28% 2466 0.15%
Provision for Doubtful
Debts 2375 0.33% 16052 2% 0 0% 0 0% 1012
Provision for Taxation 0 0% 1246 0.13% 2956 1% 5630 1% 2273
Depreciation 41764 7% 65721 7% 22500 7% 46607 7% 4659
Extra Ordinary Expenses 0 0% 0 0% 0 0% 0 0% 996
Other Expenditure 21518 3% 21201 2% 6548 2% 14446 2% 1570
TOTAL
EXPENDITURE 628975 100% 962890 100% 330482 100% 698770 100% 79339
PROFIT AND LOSS
ACCOUNT -40754 -8.16% 21853 2.50% 52709 16.07% 42768 5.94% 2583
 TREND ANALYSIS

2012-13 2013-14 2014-15 2015-

ARS 2012-13 2013-14 2014-15 2015-16 2016-14
(%) (%) (%) 16(%)

527947 477999 494547 450754 415081 100% 91% 94% 85%

Progress 2090 40153 0 3456 0 100% 1921% 0% 165%

378623 366324 383094 424145 417870 100% 97% 101% 112%

71838 80975 83306 97695 112722 100% 113% 103% 136%
Balances 11041 11930 13424 29272 47558 100% 108% 122% 265%
nces 64067 37054 46674 42515 47589 100% 58% 73% 66%
2588 3611 5631 5632 5632 100% 140% 218% 218%

149 0 0 0 0 100% 0% 0% 0%
Account 74138 52285 0 0 0 100% 71% 0% 0%

ASSETS 1132481 1070331 1026676 1053469 1046452 100% 95% 91% 93%

84873 84873 84873 84873 84873 100% 100% 100% 100%

46000 46000 138327 138327 138327 100% 100% 301% 301%
plus 41296 41296 41720 84488 121790 100% 100% 101% 205%

503717 341188 241060 241729 234704 100% 68% 48% 48%

240060 243361 239385 238286 235082 100% 101% 99% 99%

s 6808 10509 23904 19635 18256 100% 154% 351% 288%

yments 0 0 0 0 16999 100% 0% 0% 0%
es 174234 249398 196773 186623 145105 100% 143% 113% 107%
35493 53706 60634 59508 51316 100% 151% 171% 168%

ILITIES 1132481 1070331 1026676 1053469 1046452 100% 95% 91% 93%
 Trend analysis is a form of comparative analysis that is often employed to identify
current and future movements of an investment or group of investments. The process may
involve comparing past and current financial ratios as they related to various institutions
in order to project how long the current trend will continue. This type of information is
extremely helpful to investors who wish to make the most from their investments.

Trend analysis is an important tool of horizontal financial analysis. This is helpful

in making a comparative study of the financial statements for several years. Under this
method trend percentages are calculated for each item of the financial statements taking
the figure of base year as 100. The starting year is taken as the base year.

The trend percentages show the relationship of each item with its preceding year’s
percentages. These percentages can also be presented in the form of Index Numbers
showing relative change in the financial date of certain period. This will exhibit the
direction to which the concern is proceeding. The trend ratio may be compared with the
industry, in order to know the strong or weak points of a concern. These are calculated
only for major items instead of calculating for all items in the financial statements.
 TREND ANALYSIS BALANCE SHEET 2012-17
TABLE 4.13

2016- 2012-13 2013-14

PARTICULARS 2012-13 2013-14 2014-15 2015-16
14 (%) (%)
INCOME
Sales 499305 858160 328091 719255 816052 100% 172%
Extra Ordinary Income 0 25500 0 0 100% 0%
Other Income 91193 1519886 9134 1282 7702 100% 16%
Deferred Tax Liability 1837 0 0 0 0 100% 0%
Increase/Decrease in Stock -4114 -25403 20466 21001 -4522 100% 617%
TOTAL INCOME 588221 984743 383191 741538 741538 100% 167%
EXPENDITURE
Purchase of Finished Goods 752 1297 310 797 1037 100% 173%
Material consumed 14135 229678 95400 205950 246220 100% 163%
Power And Fuel 128447 153703 54302 109582 123158 100% 120%
Salaries, Wages and Bonus 78030 143519 47949 83183 96317 100% 184%
Repairs and Maintenance 21169 27879 9558 20013 22732 100% 132%
Insurance 2579 6108 2169 4510 3112 100% 237%
Travelling Expenses 3635 5938 1257 4253 3586 100% 163%
Miscellaneous Expenses 4933 11049 1665 3513 4482 100% 224%
Packing and Forwarding 25812 65560 23321 39742 51182 100% 254%
Commission and Discount 8095 13564 5571 15179 13026 100% 168%
Advertisement Expenses 489 935 405 1177 2116 100% 191%
Research and Development 196 464 130 315 258 100% 237%
Interest on Fixed Assets 61650 60659 1899 21602 23037 100% 98%
Interest on other loans 31470 5654 18896 36289 32629 100% 18%
Excise Duty 54277 99601 37338 82069 61850 100% 184%
Prior Period Adjustment 428 47 -1748 1447 3534 100% 11%
Bad And DD Written off 0 33015 56 2466 0 100% 100%
Provision for Doubtful Debts 2375 16052 0 0 10123 100% 676%
Provision for Taxation 0 1246 2956 5630 22732 100% 100%
Depreciation 41764 65721 22500 46607 46599 100% 157%
Extra Ordinary Expenses 0 0 0 0 9964 100% 0%
Other Expenditure 21518 21201 6548 14446 15702 100% 99%
TOTAL EXPENDITURE 628975 962890 330482 698770 793396 100% 153%
PROFIT AND LOSS ACCOUNT -40754 21853 52709 42768 25836 100% -54%

TREND ANALYSIS INCOME STATEMENT 2012-17

Table No: 14
 PARTICULARS 2016- 2012-13 2013-14
2012-13 2013-14 2014-15 2015-16
14 (%) (%)
INCOME
Sales 499305 858160 328091 719255 816052 100% 172%
Extra Ordinary Income 0 25500 0 0 100% 0%
Other Income 91193 1519886 9134 1282 7702 100% 16%
Deferred Tax Liability 1837 0 0 0 0 100% 0%
Increase/Decrease in Stock -4114 -25403 20466 21001 -4522 100% 617%
TOTAL INCOME 588221 984743 383191 741538 741538 100% 167%
EXPENDITURE
Purchase of Finished Goods 752 1297 310 797 1037 100% 173%
Material consumed 14135 229678 95400 205950 246220 100% 163%
Power And Fuel 128447 153703 54302 109582 123158 100% 120%
Salaries, Wages and Bonus 78030 143519 47949 83183 96317 100% 184%
Repairs and Maintenance 21169 27879 9558 20013 22732 100% 132%
Insurance 2579 6108 2169 4510 3112 100% 237%
Travelling Expenses 3635 5938 1257 4253 3586 100% 163%
Miscellaneous Expenses 4933 11049 1665 3513 4482 100% 224%
Packing and Forwarding 25812 65560 23321 39742 51182 100% 254%
Commission and Discount 8095 13564 5571 15179 13026 100% 168%
Advertisement Expenses 489 935 405 1177 2116 100% 191%
Research and Development 196 464 130 315 258 100% 237%
Interest on Fixed Assets 61650 60659 1899 21602 23037 100% 98%
Interest on other loans 31470 5654 18896 36289 32629 100% 18%
Excise Duty 54277 99601 37338 82069 61850 100% 184%
Prior Period Adjustment 428 47 -1748 1447 3534 100% 11%
Bad And DD Written off 0 33015 56 2466 0 100% 100%
Provision for Doubtful Debts 2375 16052 0 0 10123 100% 676%
Provision for Taxation 0 1246 2956 5630 22732 100% 100%
Depreciation 41764 65721 22500 46607 46599 100% 157%
Extra Ordinary Expenses 0 0 0 0 9964 100% 0%
Other Expenditure 21518 21201 6548 14446 15702 100% 99%
TOTAL EXPENDITURE 628975 962890 330482 698770 793396 100% 153%
PROFIT AND LOSS ACCOUNT -40754 21853 52709 42768 25836 100% -54%

RATIO ANALYSIS
LIQUIDITY RATIO

CURRENT RATIO

CURRENT RATIO = Current Assets

Current Liability

TABLE NO: 15
CURRENT RATIO

(Rs in thousands)
YEAR CURRENT CURRENT CURRENT RATIO
ASSETS LIABILITY
2012-2013 525569 209727 2.5
2013-2014 496283 303104 1.6
2014-2015 526498 257407 2.0
2015-2016 593627 246131 2.4
2016-2017 625739 196421 3.2

Sources Company Records

CHART NO: 15
CURRENT RATIO

Current Ratio

3.5
3
2.5
PERCENTAGE

2
3.2
1.5 2.5 2.4
1 2
1.6
0.5
0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR

INFERENCE:
In the year 2013-2014 companies’ current liability is comparatively high compared to last
year as there is an increase in its liability. After 2013-2014 company started to recover
and the current liabilities came down considerably. Current ratio has shown an
increasing trend in the past three years which means the company is able to maintain
sufficient margin of working capital after paying off the liabilities.
LIQUID RATIO OR QUICK RATIO

LIQUID RATIO = Liquid Assets

Liquid Liabilities

TABLE NO: 16
LIQUID RATIO OR QUICK RATIO
(RS IN THOUSANDS)
YEAR QUICK ASSETS QUICK LIABILITY QUICK RATIO
2012-2013 146946 209727 07
2013-2014 129959 303104 0.43
2014-2015 143404 257407 0.56
2015-2016 169482 246131 0.7
2016-2017 207869 196421 1.05
Sources Company Records
TABLE NO: 16
LIQUID RATIO OR QUICK RATIO

7
Quick Ratio
6

5
PERCENTAGE

4
7
3

1
0.56 0.7 1.05
0.43
0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR

INFERENCE:
In the year 2013-2014 the quick ratio has come down to 0.43 as the current liability is
high during the year. After 2013-2014 company started to recover as there is an
increasing trend in quick ratio. The company has become successful in achieving this
ratio which means its quick assets are sufficient to pay off the short term obligations. The
current quick ratio of the firm is greater than 1:1 hence it can be said that the financial
position of the firm is good.
 CASH RATIO

CASH RATIO = Cash and Bank + Cash in Hand

Current Liabilities
TABLE NO: 17

CASH RATIO

(Rs in thousands)
YEAR CASH CURRENT LIABILITIES CASH RATIO
2012-2013 11041 209727 0.052
2013-2014 11930 303104 0.039
2014-2015 13424 257407 0.052
2015-2016 29272 246131 0.119
2016-2017 47558 196421 0.242
Sources Company Records

CHART NO: 3
CASH RATIO

Cash Ratio

0.25

0.2
PERCENTAGE

0.15
0.242
0.1
0.119
0.05
0.052 0.039 0.052
0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR
 INFERENCE:
As the company was maintaining a small amount of cash the cash ratio is too low during
the year2012-2013 to 2013-2014. From the year 2015-2016 company started to maintain
high cash by which the cash ratio has increased to 0.199 in the year 2015-2016 and to
0.242 in the year 2016-2017 .The acceptable norm for the ratio is 0.5:1. Cash position of
the company is not satisfactory.

LEVERAGE RATIO OR SOLVENCY RATIO

DEBT EQUITY RATIO

Debt Equity Ratio = Long Term debt

Share Holders Fund
TABLE NO: 18
DEBT EQUITY RATIO

(Rs in thousands)
YEAR OUTSIDER’S SHARE HOLDERS DEBT EQUITY RATIO
FUND FUND
2012-2013 713444 172169 4.14
2013-2014 644292 172169 3.74
2014-2015 498467 264920 1.9
2015-2016 487860 307688 1.6
2016-2017 431125 344990 1.24
Sources Company Record
TABLE NO: 18
DEBT EQUITY RATIO

4.5
Debt Equity Ratio
4
3.5
3
PERCENTAGE

2.5
4.14
2 3.74
1.5
1 1.9 1.6
1.24
0.5
0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR

INFERENCES
The debt equity ratio during 2012-2013 is high as the company depended mostly on
outsiders fund during the year and it has decreased over the years as there is a decreasing
trend in ratio. The ratio indicates extend the firm depends upon outsiders for its existence.
The decreasing trend in the ratio shows that their dependence has decreased when it
comes from 2012-2013 to 2016-2017
PROPRIETARY RATIO

Proprietary Ratio = Shareholder’s Fund

Total Assets

TABLE NO: 19
PROPRIETARY RATIO

(Rs in thousands)
YEAR SHARE HOLDERS FUND TOTAL ASSETS PROPRIETARY
RATIO
2012-2013 172169 1055606 0.16
2013-2014 172169 1017822 0.17
2014-2015 264920 1021045 0.26
2015-2016 307688 1047837 0.29
2016-2017 344990 1040820 0.33
Sources Company Records
CHART NO: 5
PROPRIETARY RATIO

0.35
Proprietary Ratio
0.3

0.25
PERCENTAGE

0.2

0.15

0.1

0.05

0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR

INFRENCE:
The increasing trend of proprietary ratio indicates the firm’s dependence on creditors for
its working capital has been decreasing. The firm has not reached the ideal proprietary
ratio of 0.5:1 which is alarming for the creditors but the creditors increasing trend in the
ratio is also satisfactory for them.
CAPITAL GEARING RATIO

Capital Gearing Ratio = Fixed Income bearing funds

Equity shareholder’s fund

TABLE NO: 20
CAPITAL GEARING RATIO

(Rs in thousands)
YEAR FIXED INCOME EQUITY CAPITAL
BEARING FUNDS SHAREHOLDER’S GEARING
FUND RATIO
2012-2013 46000 84873 0.54
2013-2014 46000 84873 0.54
2014-2015 138727 84873 1.63
2015-2016 138727 84873 1.63
2016-2017 138727 84873 1.63

Sources Company Records

CHART NO: 6
CAPITAL GEARING RATIO

Capital Gearing Ratio

1.5
PERCENTAGE

1
1.63 1.63 1.63

0.5
0.54 0.54
0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR

INFERNCE:
From the above table and chart it can be seen that the capital gearing ratio has increased
from 0.54:1 to 1.61:1 and is being constant for about the past three accounting years.
Company invested in more fixed income bearing funds in the year 2014-2015and the
equity shareholder’s fund has remained constant for the past five years which indicates
risk to the equity shareholders.
SOLVENCY RATIO
Solvency Ratio = Total assets
Total Liabilities

TABLE NO: 21
SOLVENCY RATIO

(Rs in thousands)
YEAR TOTAL ASSETS TOTAL LIABILITY SOLVENCY
RATIO
2012-2013 1055606 713444 1.48
2013-2014 1017822 644292 1.58
2014-2015 1021045 498467 2.05
2015-2016 1047837 487860 2.15
2016-2017 1040820 431125 2.41
Sources Company Records
CHART NO: 7
SOLVENCY RATIO

2.5
Solvency Ratio
2
PERCENTAGE

1.5
2.41
2.05 2.15
1
1.48 1.58

0.5

0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR

INFERENCE:
Solvency ratio is low in the year 2012-2013 as the total liability was high during the year.
After 2013-2014 total assets has increased and the total liability has come down and this
has caused to an increase in the solvency ratio. Solvency ratio measures the ability of a
firm to pay the outside liabilities out if total assets. Higher the ratio stronger is the
financial position of the firm. Increasing trend of the ratio had proven favourable for the
company.
INTEREST COVERAGE RATIO
Interest Charges Ratio = Profit before depreciation and tax
Interest charges
TABLE NO: 22
INTEREST COVERAGE RATIO

(Rs in thousands)
YEAR PROFIT BEFORE INTEREST INTEREST
INTEREST AND TAX CHARGES COVERAGE RATIO
2012-2013 1010 93120 0.11
2013-2014 88820 66313 1.34
2014-2015 78165 20795 3.76
2015-2016 95005 57891 1.64
2016-2017 95167 55666 1.71
Sources Company Records

CHART NO: 8
INTEREST COVERAGE RATIO
 Interest Coverage Ratio

4
3.5
3
PERCENTAGE

2.5
2 3.76
1.5
1 1.64 1.71
1.34
0.5
0.11
0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR

INFERENCE:

During the year 2012-2013 company’s profit was too low and the company recovered in
the year 2013-2014 and the interest coverage ratio has increased. In the year 2014-2015 it
shows the highest ratio as the company as the interest charges were too low during the
year. The firm’s interest coverage ratio is far below the standard ratio which is 6 to 7
times. Low ratio indicates excessive use of debt and the inability to offer assured
payment of interest to creditors.

PROFITABILY RATIO
NET PROFIT RATIO

Net Profit Ratio = Net Profit * 100

Net Sales
TABLE NO: 23
NET PROFIT RATIO
 (Rs in thousands)
YEAR NET PROFIT NET SALES NET PROFIT
RATIO
2012-2013 -40754 445028 NA
2013-2014 21853 758559 2.88
2014-2015 52709 290753 18.13
2015-2016 42768 630840 6.78
2016-2017 25836 750864 34.4

Sources Company Records

CHART NO: 09
NET PROFIT RATIO

Net Profit Ratio NA

35
30
PERCENTAGE

25
20 34.4
15
10 18.13
5 6.78
2.88
0
2013-2014 2014-2015 2015-2016 2016-2017
YEAR

INFERENCE:
From the above table and chart it is clear that the net profit ratio of the company is
constantly fluctuating. In the year 2012-2013 the company has incurred a loss. Net profit
ratio measures the overall profitability of the firm. The ideal net profit is 5% to 10%.

RETURN ON SHAREHOLDER’S FUND

Return on Shareholder’s fund = Net Profit after Interest and tax * 100
Shareholder’s Fund
TABLE NO: 24
RETURN ON SHAREHOLDER’S FUND

(Rs in thousands)
Year Net Profit after Interest Shareholder’s Return on Shareholder’s
and Tax fund Fund
2012-2013 -40754 172169 NA
2013-2014 21853 174924 12.5
2014-2015 52709 264920 19.8
2015-2016 42768 307688 13.9
2016-2017 25836 344990 7.5
Sources Company Records

CHART NO: 10
RETURN ON SHAREHOLDER’S FUND

Return on Shareholder’s Fund NA

20

15
PERCENTAGE

10 19.8
12.5 13.9
5 7.5

0
2013-2014 2014-2015 2015-2016 2016-2017
YEAR
INFERENCES
From the above table and chart it can be inferred that return on shareholder’s fund
is constantly fluctuating. The net profit kept fluctuating during the years and the share
holders fund kept on increasing. Higher ratio indicates better utilization of owner’s funds
and higher productivity. Although return on equity shareholder’s fund is satisfactory for
the company but it has shown a decrease in the last two accounting year

PRICE EARNINGS RATIO

Price Earnings Ratio = Market Price per Share

Earnings per Share

TABLE NO: 25
PRICE EARNINGS RATIO
(Rs in thousands)
YEAR MARKET PRICE EARNINGS PER PRICE EARNINGS
PER SHARE SHARE RATIO
2012-2013 100 -54 NA
2013-2014 100 12 8.33
2014-2015 100 -7 NA
2015-2016 100 2.5 4
2016-2017 100 3.7 2.7
Sources Company Records
CHART NO: 11
PRICE EARNINGS RATIO

9
Price Earnings Ratio
8
7
6
PERCENTAGE

5
8.33
4
3
2 4
2.7
1
0 0 0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR

INFERENCE:
From the above table and chart it is clear that in the year 2012-2013 earnings per share is
negative and again in the year 2014-2015 it again went to negative. The ratio indicates
the number of times the earnings per share is covered by its market price. This ratio is
mainly used to value company’s performance as expected by equity shareholders

ACTIVITY RATIOS
STOCK TURNOVER RATIO

Stock Turnover Ratio = Net Sales

Average inventory at selling price

TABLE NO: 26
STOCK TURNOVER RATIO

(Rs in thousands)
YEAR COST OF GOODS AVERAGE STOCK TURNOVER
SOLD STOCK RATIO
2012-2013 445028 304464 1.64
2013-2014 758559 309641 2.8
2014-2015 290753 307172 1.07
2015-2016 630840 327906 2.2
 2016-2017 750864 336145 2.43
Sources Company Records

CHART NO: 12
STOCK TURNOVER RATIO

Stock Turnover Ratio

3
2.5
PERCENTAGE

2
1.5 2.8
2.2 2.43
1 1.64
1.07
0.5
0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR
INFERENCE:
From the above table and chart it can be seen that the cost of goods sold kept fluctuating
due to the changes in sales. Whereas the Average Stock was able to maintain balance as
the production was steady. The ratio measures how quickly inventory is sold. The firm’s
stock turnover is not very high which indicates the inventories are not sold so fast.

FIXED ASSETS TURNOVER RATIO

Fixed Assets Turnover Ratio = Net Sales

Net fixed assets

TABLE NO: 27
FIXED ASSETS TURNOVER RATIO

(Rs in thousands)
YEAR NET SALES FIXED FIXED ASSETS TURNOVER
ASSETS RATIO
2012-2013 445028 530037 0.94
2013-2014 758559 518152 1.65
2014-2015 290753 494547 0.66
2015-2016 630840 454210 1.6
 2016-2017 750864 415081 2.00
Sources Company Records

CHART NO: 13
FIXED ASSETS TURNOVER RATIO

Fixed Assets Turnover Ratio

1.5
PERCENATAGE

1 2
1.65 1.6

0.5 0.94
0.66

0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR
INFERENCE:
From the above table and chart it can be seen that there is a fluctuation in the sales. And
the company has been selling out its fixed assets as the amount came down gradually
Higher the ratio better is for the firm. Higher ratio indicates better utilization of fixed
assets. Fixed asset turnover ratio of the firm is in the increasing trend for the past three
accounting years which is favourable for the company.

WORKING CAPITAL TURNOVER RATIO

Working Capital Turnover Ratio = Net sales

Net Working capital

TABLE NO: 28
WORKING CAPITAL TURNOVER RATIO

(RS IN THOUSANDS)
YEAR NET NET WORKING WORKING CAPITAL
SALES CAPITAL TURNOVER RATIO
2012-2013 445028 315842 1.6
2013-2014 758559 193179 4.44
 2014-2015 290753 269091 1.22
2015-2016 630840 347496 2.00
2016-2017 750864 429318 1.90
Sources Company Records

CHART NO: 14
WORKING CAPITAL TURNOVER RATIO

Working Capital Turnover Ratio

5 4.44

4
Axis Title

3
2 1.9
1.6
2 1.22
1

0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
Axis Title
INFERENCE:
From the above table and chart it is clear. Compared to 2012-2013 the net sales increased
in 2013-2014 The working capitals started to increase after 2013- 2014 and it showed a
increasing trend. The ideal working capital turnover ratio is 7 or 8 times. The company’s
working capital turnover ratio is far below the standard ratio which indicates working
capital is not effectively utilised in making sales.

DEBTORS TURNOVER RATIO

Debtors Turnover Ratio = Net Credit Sales

Average debtors including bills receivable

Average Collection Period = No of days in an accounting year

Debtors Turnover ratio
TABLE NO: 29
DEBTORS TURNOVER RATIO
(Rs in thousands)
YEAR NET CREDIT DEBTORS DEBTORS TURNOVER
SALES RATIO
2012-2013 445028 71838 6.19
2013-2014 758559 80975 9.37
2014-2015 290753 83306 3.49
2015-2016 630840 97695 6.46
2016-2017 750864 112722 6.66
Sources Company Records

CHART NO: 15
DEBTORS TURNOVER RATIO
 10
Debtors Turnover Ratio
9
8
7
PERCENTAGE

6
5 9.37
4
6.19 6.46 6.66
3
2 3.49
1
0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR

TABLE NO: 30
DEBTORS TURNOVER RATIO
(Rs in thousands)
YEAR NO OF DAYS DEBTORS AVERAGE
TURNOVER COLLECTION PERIOD
RATIO
2012-2013 365 6.19 58.96
2013-2014 546 9.37 58.27
2014-2015 182 3.49 52.15
2015-2016 365 6.46 56.50
2016-2017 365 6.66 54.80
Sources Company Records
CHART NO: 16
DEBTORS TURNOVER RATIO

Average Collection Period

60

58
PERCENTAGE

56

54
58.96 58.27
52 56.5
54.8
50 52.15

48
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR
INFERENCE:
From the above table and chart it can be inferred that. Debtor’s turnover ratio measures
the efficiency in management of debtors. The ideal turnover ratio is 7 and the firm’s
turnover ratio is also coming in this range which is a very satisfactory figure. Average
collection period of the firm is coming around 56 days which means debtors remain
outstanding for about 56 day.

CREDITORS TURNOVER RATIO

Creditors Turnover Ratio = Net Credit Purchase

Average Payment Period =
TABLE NO: 31
CREDITORS TURNOVER RATIO
Average Creditors including bills payable
No of days in an accounting year
Creditor’s turnover ratio

(Rs in thousands)
YEAR NET CREDIT AVERAGE CREDITORS
PURCHASE CREDITORS TURNOVER RATIO
2012-2013 138641 128263 1.08
2013-2014 239837 180654 1.33
2014-2015 92892 169939 0.55
 2015-2016 227611 164057 1.39
2016-2017 254163 81438 3.12

Sources Company Records

CHART NO: 17
CREDITORS TURNOVER RATIO

Creditors Turnover Ratio

3.5
3
2.5
PERCENTAGE

2
3.12
1.5
1
1.08 1.33 1.39
0.5 0.55
0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR

INFERENCE:
From this above table and chart it is clear that creditors turnover ratio of the company is
1.08:1 in the year 2012-2013 , 1.33:1 in the year 2013-2014 and 0.55:1 in the year2014-
2015 . The ratio reached1.39:1 in the year 2015-2016 and 3.12:1 in the year 2016-2017 .
Creditor’s turnover ratio of the company is low which means payment to creditors is
delayed. The creditors by the company is more than one year in the first three accounting
years but payment period has been decreased in the past two accounting years.

TABLE NO: 32
AVERAGE PAYMENT PERIOD
(Rs in thousands)
YEAR NO OF DAYS CREDITORS AVERAGE PAYMENT
TURNOVER RATIO PERIOD
2012-2013 365 1.08 338
2013-2014 546 1.33 411
2014-2015 182 0.55 331
2015-2016 365 1.39 263
2016-2017 365 3.12 117
Sources Company Records

CHART NO: 18
AVERAGE PAYMENT PERIOD

450
Average
411 Payment Period
400 338 331
350
300 263
PERCENTAGE

250
200
150 117

100
50
0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR
INFERENCE:
From this above table and chart it is clear that average payment ratio of the company is
338 in the year 2012-2013 , 411 in the year 2013-2014 and 331 in the year 2014-2015 .
The ratio reached 263 in the year 2015-2016 and 117 in the year 2016-2017 . Creditor’s
turnover ratio of the company is low which means payment to creditors is delayed. The
creditors by the company is more than one year in the first three accounting years but
payment period has been decreased in the past two accounting years.

TOTAL ASSET TRUNOVER RATIO

Total Assets Turnover Ratio = Net Sales

Total Assets
TABLE NO: 33
TOTAL ASSET TRUNOVER RATIO

(Rs in thousands)
YEAR NET SALES TOTAL TOTAL ASSET
ASSETS TURNOVER RATIO
2012-2013 445028 1055606 0.42
2013-2014 758559 1017822 0.75
2014-2015 290753 1021045 0.28
2015-2016 630840 1047837 0.60
2016-2017 750864 1040820 0.72

Sources Company Records

CHART NO: 19
TOTAL ASSET TRUNOVER RATIO

0.8
Total Asset Turnover Ratio
0.7
0.6
PERCENTAGE

0.5
0.4 0.75 0.72
0.3 0.6
0.42
0.2
0.28
0.1
0
2012-2013 2013-2014 2014-2015 2015-2016 2016-2017
YEAR

INFERENCE
From the above table and chart it can be seen that total asset turnover ratio has been
constantly fluctuating. In the year 2012-2013 the ratio is 0.42:1 which increased to
0.75:1 in2013-2014 . The ratio then decreased to 0.28:1 in the year 2014-2015 . The ratio
again showed an increase in the year 2015-2016 and reached 0.61:1. In the year 2016-
2017 the ratio became 0.71:1.

CHAPTER V

FINDING, SUGESSTION AND CONCLUSION

FINDINGS

 Company’s average current ratio is coming around the ideal current ratio 2:1
which indicates the firm’s capacity to meet the short term liabilities. Current ratio
has shown an increasing trend in the past three years which means the company is
able to maintain sufficient margin of working capital after paying off the current
liabilities.
 The company has become successful in achieving the ideal quick ratio of 1:1
which means the its quick assets are sufficient to pay off the short term
obligations. Since the current quick ratio of the firm is greater than 1:1, it can be
said that the financial position of the firm is good.
 Cash position of the company is not satisfactory.
 Debt-equity ratio indicates the extent the firm depends upon the outsiders for its
existence. The decreasing trend in the ratio shows that their dependence on the
outsiders has decreased when it comes from 2012-2017.
 Proprietary ratio shows the financial health of the firm. It tells the proportion of
shareholder’s fund in the total assets of the business. The increasing trend of
proprietary ratio indicates the firm’s dependence on creditors for its working
capital has been decreasing. The firm has not reached the ideal proprietary ratio of
0.5:1 which is alarming for the creditors but the increasing trend in the ratio is
also satisfactory for them.
 Fixed income bearing funds has increased but equity shareholder’s fund has
remained constant for the past five years which indicates risk to the equity
shareholders.
 Solvency ratio measures the ability of a firm to pay the outside liabilities out of
total assets. Higher the ratio stronger is the financial position of the firm.
Solvency ratio of the company is showing an increasing trend and hence it can be
said that company’s financial position in improving.
 The firm’s interest coverage ratio is far below the standard ratio of 6 to 7 times.
Low ratio indicates excessive use of debt and inability to offer assured payment of
interest to creditors.
 Net profit ratio of the company is constant fluctuating. But presently the
profitability of the company is satisfactory.
 Return on equity shareholders fund is satisfactory for the company but it has
shown a decrease in the last two accounting years.
 Price earnings ratio indicates the number of times the earnings per share is
covered by its market price. The company’s price earnings ratio is not
satisfactory.
 Stock turnover ratio measures how quickly inventory is sold. The firm’s stock
turnover ratio is not very high which indicates the inventories are not sold fast.
 Fixed asset turnover ratio of the firm is in the increasing trend for the past three
accounting years which means company is effectively utilising its fixed assets.
 The ideal working capital turnover ratio is 7 or 8 times. The company’s working
capital turnover is far below the standard ratio which indicates working capital is
not effectively utilised in making sales.
 Debtor’s turnover ratio means the efficiency in management of debtors. The ideal
turnover ratio is 7.and the firms turnover ratio is coming in this range which is a
very satisfactory figure. Average collection period of the firm is coming around
56 days which means debtors remain outstanding for about 56 days.
 Creditor’s turnover ratio of the company is low which means payment to creditors
is delayed. The credit enjoyed by the company is more than one year in the first
 three accounting years but payment period has been decreased in the two
accounting years.

SUGGESTIONS

 Cash position of the company is not satisfactory. It is not coming in the ideal
range. Company should see to it that they maintain a constant cash ratio.
 The company is not depending much on outsider’s fund which may affect its
functioning. Company should try to effectively utilise outsider’s fund.
 Firm’s dependence on creditors for its working capital has been decreasing which
is alarming for creditors.
 The firm’s interest coverage ratio is far below the standard ratio which is 6 to 7
times. It shows inability to offer assured payment of interest to creditors.
Company should try to take necessary action regarding the payment of creditors.
 Firm should take necessary action to decrease the stock velocity. Management
should take necessary steps to improve inventory management.
 The company should effectively utilise its working capital in generating sales.
 Creditor’s management has to be properly done by the company. Steps should be
taken so that the creditors are paid in time.

CONCLUSION

The NUTRO VESSELS INDO GROUP LIMITED AT SELAM has been serving the
state for more than 60 years. It has contributed much to the industrial development of the
state and is providing employment to hundreds of people. Over the last few years the
company has made an indelible mark in the wood industry.

The study conducted to measure the financial performance of the company has observed
that the financial position of the company is satisfactory, further improvement has to be
made.
To an extend the debt and equity of the company is affecting the financial performance of
the company.

BIBLIOGRAPHY

 PRASANNA CHANDRA: "FINANCIAL MANAGEMENT THEORY AND

PRACTICE", Fourth Edition, Tata McGraw Hill Companies.
 Last five years Annual Report (2004 to 2008) of Western India Plywoods
Limited, Kannur.
 R.K SHARMA AND GUPTHA: "MANAGEMENT ACCOUNTING" 2nd edition,
Kalyani publishers, New Delhi.
 I M PANDEY : Financial Management, 8th Edition, Vikas Publishing House

WEBSITES

 www.scribed.com
 www.wikipedia.com
 www.google.com
PROFIT AND LOSS OF THE NUTRO VESSELS INDO GROUP LIMITED
 2012 2013 2014 2015 2016 2017
INCOME
Sales 491595 499305 858160 328091 719255 816052
Other Income 4966 91193 1519886 25500 0 7702
Deferred Tax Liability 11763 1837 0 9134 1282 -4522
Increase/Decrease in Stock 49315 -4114 -25403 20466 21001 741538
TOTAL INCOME 557639 588221 984743 383191 741538 1037
EXPENDITURE
Purchase of Finished Goods 1231 752 1297 310 797 246220
Material consumed 126652 14135 229678 95400 205950 123158
Power And Fuel 112466 128447 153703 54302 109582 96317
Salaries, Wages and Bonus 85381 78030 143519 47949 83183 22732
Repairs and Maintenance 15955 21169 27879 9558 20013 3112
Insurance 2425 2579 6108 2169 4510 3586
Travelling Expenses 3476 3635 5938 1257 4253 4482
Miscellaneous Expenses 8743 4933 11049 1665 3513 51182
Packing and Forwarding 25494 25812 65560 23321 39742 13026
Commission and Discount 11533 8095 13564 5571 15179 2116
Advertisement Expenses 496 489 935 405 1177 258
Research and Development 219 196 464 130 315 23037
Interest on Fixed Assets 48005 61650 60659 1899 21602 32629
Interest on other loans 38001 31470 5654 18896 36289 61850
Excise Duty 55464 54277 99601 37338 82069 3534
Prior Period Adjustment 630 428 47 -1748 1447 0
Bad And DD Written off 397 0 33015 56 2466 10123
Provision for Doubtful Debts 2237 2375 16052 0 0 22732
Provision for Taxation 0 0 1246 2956 5630 46599
Depreciation 0 41764 65721 22500 46607 9964
Other Expenditure 18102 21518 21201 6548 14446 15702
TOTAL EXPENDITURE 556907 628975 962890 330482 698770 793396
PROFIT AND LOSS
ACCOUNT 732 -40754 21853 52709 42768 25836
PARTICULARS 2012 2013 2014 2015 2016 2017
ASSETS
Fixed Assets:
Net Block 553851 527947 477999 494547 450754 415081
Capital Work in
Progress 2870 2090 40153 0 3456 0
Current Assets:
Inventories 387717 378623 366324 383094 424145 417870
Sundry Debtors 72097 71838 80975 83306 97695 112722
Cash and Bank
Balances 10794 11041 11930 13424 29272 47558
Loans and Advances 53826 64067 37054 46674 42515 47589
Investments 2739 2588 3611 5631 5632 5632
Miscellaneous
Expenses 298 149 0
Profit and Loss
Account 33384 74138 52285 0
TOTAL ASSETS 1117576 1132481 1E+06 1026676 1053469 1046452
LIABILITIES
Share Capital:
Equity 84873 84873 84873 84873 84873 84873
Preference 46000 46000 46000 138327 138327 138327
Reserves and Surplus 41296 41296 41296 41720 84488 121790
Secured Loan:
Term Loans 449763 503717 341188 241060 241729 234704
Others 253798 240060 243361 23985 238286 235082
Unsecured Loan 6784 6808 10509 23904 19635 18256
Current Liabilities 199897 174234 249398 196773 186623 145105
Provisions 33328 35493 53706 60634 59508 51316
Deferred Tax
Liability 1837 0 16999
TOTAL
LIABILITIES 1117576 1132481 1070331 1026676 1053469 1046452
BALANCE SHEET OF THE NUTRO VESSELS INDO GROUP LIMITED