Professional Documents
Culture Documents
Analysis of Financial Statements of Cadbury India Ltd and Nestle India Ltd for year ending on 31st December 2008
Index
y Cadburys India Ltd. o Overview.2 o Financial Statements as per 31st Dec 2008 Balance Sheet.3 Profit and Loss Account4
y Nestle India Ltd. o Overview.5 o Financial Statements as per 31st Dec 2008 Balance Sheet.6 Profit and Loss Account7 y Financial Ratios..8
1|P ag e
2|P ag e
Financial Statements
y Balance Sheet as on 31st December 2008 Particulars
Equity Capital Preference Capital Share Capital Reserves and Surplus Loan Funds Current Liabilities Provisions Current Liabilities and Provisions Total Liabilities and Stockholders Equity Tangible Assets Net Intangible Assets Net Net Block Capital Work In Progress Net Fixed Assets Investments Inventories Accounts Receivable Cash and Cash Equivalents Other Current Assets Current Assets Loans & Advances Miscellaneous Expenditure Other Assets Total Assets
3|P ag e
4|P ag e
5|P ag e
Financial Statements
y
Particulars
Equity Capital Preference Capital Share Capital Reserves and Surplus Loan Funds Current Liabilities Provisions Current Liabilities and Provisions Total Liabilities and Stockholders Equity Tangible Assets Net Intangible Assets Net Net Block Capital Work In Progress Net Fixed Assets Investments Inventories Accounts Receivable Cash and Cash Equivalents Other Current Assets Current Assets Loans & Advances Miscellaneous Expenditure Other Assets Total Assets
6|P ag e
7|P ag e
Formula
Expense Ratio Expense /Sales *100 i) Selling and Distribution and Administrative Expenses Ratio Administrative Expenses /Sales *100 ii)Interest Ratio Interest Expenses/Sales *100
30.56%
14.25%
30.23% 0.32%
14.22% 0.03%
Net Profit Ratio Return on capital employed Return on Shareholder's funds Return on Equity Share capital
Net Profit(after interest and tax)/Sales *100 10.4% Net Profit/(Share Capital +Reserve + Long term Loans)*100 32.75% Net Profit/(Share Capital +Reserve)*100 35.69% (Net Profit-Preference dividend)/Equity Share Capital *100 515.13% (After tax profit-Preference Dividend)/Number of Equity Shares *100 50.6% Current Assests/Currrent Liabilities Liquid Assests/Liquid Liabilities Quick Assests/Liquid Liabilities
12.8%
112.82% 112.82%
563.26%
Earnings per Share Current ratio Liquid Ratio Acid-test Ratio Proprietary Ratio Debt-Equity Ratio
55.4%
1.2 1.32 Information not Information not available available 0.7 0.5 27.92% 0% 0 0 450.75 6.88 1.05%
Proprietor's Fund/Total assests 48.37% Long term Liabilities/Owner's Funds 8.90% *100 Preference Share capital + Debenture /Equity Share Capital 0 11.11% 34.97 27.21 1.24%
Gearing Ratio Long term funds to fixed assests Long Term Funds/Fixed Assests * 100 Pofit before interest and Interest Coverage Ratio taxes/interest Stock Turnover Debtors' ratio 8|P ag e Cost of sales/Average Stock (Debtors'+Bills Receivables)/Credit sale *100
Current Liability (creditors +Bills payable )/Credit Breakup not Purchases *365 available Creditors' Velocity Total assests Turnover Sales/Total Assets 165.46% Profit(Available for debt Amount of Debt Service Coverage payment)/(instalment of principal Principle not ratio +interest) available
Current Liability Breakup not available 255.11% Amount of Principle not available
y y
9|P ag e
when we consider the point of view of the proprietor. For Cadbury, its almost half of the total funds employed in the business. The debt equity ratio should be an optimum value for the business. A higher value would mean low sustainability of the company and lower value would indicate that external credit is not being employed in the company. For Nestle, this value is alarmingly low, as it has not utilized any outside credit which was at its disposition.
10 | P a g e