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ratio anaylsis of dabur india ltd

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ratio anaylsis of dabur india ltd

  1. 1. DABUR INDIA LIMITED Made by:  Ruchi lakhote  Madhu bala  Som prakash das  Sunay patil
  2. 2. ABOUT THE COMPANY:  Dabur India Limited is the fourth largest FMCG Company in India with Revenues of over Rs 6,146 Crore & Market Capitalisation of US $5 Billion. Building on a legacy of quality and experience of over 127 years, Dabur operates in key consumer products categories like Hair Care, Oral Care, Health Care, Skin Care, Home Care & Foods.  DABUR the name is derived from DAKTAR BURMAN , was founded by Dr. S.K Burman.
  3. 3. PROFITABILITY RATIO: 1. • GROSS PROFIT RATIO 2. • NET PROFIT RATIO 3. • OPERATING RATIO 4. • RETURN ON INVESTMENT RATIO 5. • RETURN ON CAPITAL EMPLOYED RATIO 6. • EARNING PER SHARE
  4. 4. GROSS PROFITRATIO  2009-2010: GP remains none or less same as there were individual increase in inventory, debtors but there was no overall change.  2010-2011: There is a 8.49 increase in 2011 because of increase in inventory and stock.  But the same trend could not be followed in 2012-13 where it declined by 3.63 because of increase in current liabilities. 46.79 46.05 49.68 41.19 41.19 2013 2012 2011 2010 2009 GROSS PROFIT GROSS PROFIT
  5. 5. NET PROFIT RATIO: 13.59 12.33 14.12 19.11 17.99 2013 2012 2011 2010 2009 NET PROFIT RATIO •In 2009-10 the indirect expenses were less as compared to 2011-2013 because of that the net profit ratio is higher in the year 2009- 2010.
  6. 6. OPERATING COST 31.55 30.70 32.31 25.26 23.20 2013 2012 2011 2010 2009 OPERATING COST •From 2011 onwards the company incurred more indirect expenses as compared to previous years so the ratio from 2011 increased as comapred to in 2009-2010. •In 2010-2011 there is increase in finance cost, depreciation, and other expenses due to which the ratio increased by 6.95.
  7. 7. 38.12 39.49 38.84 47.70 50.44 2013 2012 2011 2010 2009 cost of material consumed 6.47 6.48 6.62 7.37 6.90 2013 2012 2011 2010 2009 employee cost ratio 0.42 0.38 0.37 0.19 0.55 2013 2012 2011 2010 2009 finance cost ratio 1.68 1.75 2.07 1.11 1.13 0.00 0.50 1.00 1.50 2.00 2.50 2013 2012 2011 2010 2009 depriciation ratio
  8. 8. OTHEREXPENSES: 22.98 22.09 23.25 12.30 14.62 2013 2012 2011 2010 2009 other expense ratio other expense ratio
  9. 9. RETURN ON INVESTEMENT RATIO: 20.90 18.90 19.58 43.19 44.01 2013 2012 2011 2010 2009 ROI ratio •In 2009 ROI ratio was highest as compared to other years because from 2009 onwards the total increase in assests was more as comapred to total increase in profits, so the ratio decreased after 2010
  10. 10. RETURN ON CAPITAL EMPLOYED RATIO 37.04 35.51 19.58 43.19 44.01 2013 2012 2011 2010 2009 ROCE ratio •From 2009-2013 there was constant increase in Net profit except in 2012 where it dropped a little, but the capital employed by the company is highest in the year 2011 and decreased suddenly by 1,10,350 Rs in 2012.so the ratio decreased in 2011 and increased suddenly in 2012.
  11. 11. EARNING PER SHARE: 3.39 2.66 2.71 4.98 4.31 2013 2012 2011 2010 2009 EPS •It can be derived from the graph that the amount earned by the company for the share holders is highest in 2010.
  12. 12. PROFITABILITY RATIO ANALYSIS:  By looking at all the profitability ratio’s we can conclude that DABUR limited has good profitability position as the gross profit and net profit ratio’s are showing an increasing trend.  In 2009-2010, the company is earned exceptionally well on its investment which was reflected by its ROI ratio.  Even the ROCE ratio, was overall good except in 2011.
  13. 13. LIQUIDITYRATIO 1. • CURRENT RATIO 2. • ACID TEST RATIO 3. • CASH RATIO 4. • DEFENSIVE INTERVAL RATIO
  14. 14. CURRENT RATIO: 2013 2012 2011 2010 2009 1.50 1.48 1.51 0.54 0.56 CURRENT RATIO •The company could not achieve the standard current ratio i.e 1.33:1 in 2009-2010 but from 2011 onwards it improved on its current ratio. •There was increase in inventories and short term advances from 2011. •Even the cash position of the company was better after 2011.
  15. 15. ACID TEST RATIO: 1.07 0.99 1.01 0.32 0.43 2013 2012 2011 2010 2009 acid test ratio acid test ratio •Except in 2009-2010, company was able to maintain Standard acid test ratio of 1:1. •In 2009-2010 it was less because the value of current assests i.e cash and debtors was less, so after deducting inventory from current assests the ratio further decreased. •From 2011 onwards company made some short term investments, which was not made in 2010,2009 so the acid test ratio increased from 2011.
  16. 16. CASH RATIO: 2013 2012 2011 2010 2009 CASH RATIO 0.28 0.24 0.21 0.13 0.22 0.00 0.05 0.10 0.15 0.20 0.25 0.30 AxisTitle CASH RATIO •In all the years from 2009-2013 the company could not achieve the standard cash ratio of .5:1. •In 2010 the current liabilities were more as compared to the cash available with the company. •From 2010 onwards the ratio started increasing because the cash available with the company increased.
  17. 17. DEFENSIVE INTERVAL RATIO: 125.02 124.70 129.38 73.77 52.42 2013 2012 2011 2010 2009 DEFENSIVE INTERVAL RATIO •Overall it is good for the company that its defensive interval ratio is increasing from 2009 onwards. •It was highest in the year 2011 because liquid assets were good in terms of its projected daily cash requirement. •In 2009-2010, as per the daily cash requirements, liquid assets were not sufficient to meet them.
  18. 18. LIQUIDITY RATIO ANALYSIS:  Overall we can say that the liquidity position of the company was satisfactory.  Only in 20011-2013, the current ratio and acid test ratio achieved the standard rate.  But cash ratio didn’t achieved the standard rate in any of the years.  The defensive interval ratio is increasing over the years.  The company started making short term investments from 2011 which is good for the liquidity position of the company.
  19. 19. TURNOVERRATIOS: 1. • INVENTORY TURNOVER RATIO 2. • DEBTORS TURNOVER RATIO 3. • CREDITORS TURNOVER RATIO 4. • ASSESTS TURNOVER RATIO 5. • CAPITAL TURNOVER RATIO 6. • CURRENT ASSESTS TURNOVER RATIO 7 • INVENTORY HOLDING PEROID 8. • DEBTORS CREDIT PEROID 9. • CREDITORS CREDIT PEROID
  20. 20. INVENTORYTURNOVERRATIO 8.70 7.11 7.12 9.65 9.26 2013 2012 2011 2010 2009 INVENTORY TURNOVER RATIO •In 2010 it is highest as the value of stock was less as compared to sales. •In 2011-2012 the ratio declined because there was increase in inventory. •And in 2013 it again increased because the inventories came down.
  21. 21. DEBTORS TURNOVER RATIO 17.04 16.76 16.20 25.64 21.57 2013 2012 2011 2010 2009 Debtors turnover ratio •From the profit and loss account it is clear that sales is increasing every year, even debtors are also increasing so there is not much fluctuation in debtors turnover ratio except in 2009-2010. •In 2009-2010, the value of debtors was significantly less.
  22. 22. CREDITORS TURNOVER RATIO 3.79 4.00 3.49 3.18 3.69 2013 2012 2011 2010 2009 creditors turnover ratio •From the graph it is clear that from 2009-2013 there was no major fluctuation in creditors turnover ratio. •As over the years both sales and creditors increased in the same proportion.
  23. 23. ASSESTS TURNOVER RATIO 1.54 1.53 1.36 2.36 2.49 2013 2012 2011 2010 2009 •In 2009-2010 the assets turnover ratio is highest which is better for the company, as assets were efficiently utilised. •After 2011, it declined as the assets and revenue were not in proportion to each other.
  24. 24. CAPITAL TURNOVER RATIO 2.73 2.88 2.96 3.78 3.26 2013 2012 2011 2010 2009 capital turnover ratio •In 2009-2010, it is higher as company had less share capital and reserves. •After 2010, share capital and reseves increased so the ratio declined. •In 2009-2010 it also shows that the available funds are efficiently utilised.
  25. 25. CURRENT ASSETS TURNOVER RATIO 2.50 2.36 2.35 4.38 4.46 2013 2012 2011 2010 2009 Current assests turnover ratio •It is higher in 200-2010 and it shows that current assets of the company are moving fast in these two years. •From 2011-2013, it decreased because the value of current assets increased up to great extent.
  26. 26. INVENTORY HOLDING PERIOD (IN DAYS): 41.94 51.34 51.25 33.16 39.41 2013 2012 2011 2010 2009 inventory holding period •Inventory holding period is minimum in 2010 i.e 33 days, it is better for the company. •From 2011-2012, it increased to 51 days as inventory of the company increased. •In 2013, the value of inventory came down so as the inventory holding period.
  27. 27. DEBTORS COLLECTION PERIOD(IN DAYS) 21.43 21.78 22.53 16.53 16.92 2013 2012 2011 2010 2009 debtors collection period •In 2011, debtors collection period was highest i.e 23 days, which is not good for the company. •In 2009-2010 it is 17 days as the average debtors were less as compared to other years, and thus it is good for the company.
  28. 28. CREDITORS PAYMENT PERIOD(IN DAYS) 96.36 91.36 104.47 87.99 98.89 2013 2012 2011 2010 2009 creditors payment period •Except in 2010, the payment period was higher from other years as creditors of the company was minimum in 2010 as compared to other years. •It is highest in 2011, as credit purchase increases and so as the creditors payment period.
  29. 29. TURNOVER RATIO ANALYSIS:  Inventory turnover ratio and debtors turnover ratio were better in 2009-2010.  Creditors turnover ratio was more or less the same from 2009-2013.  Assests turnover ratio,capital turnover ratio were highest in 2009-2010 because rate of increase in assetes and capital employed was less in 2009- 2010.  Inventory, credit and debtors holding period were unsatisfactory.
  30. 30. SOLVENCY RATIO 1. • LONG TERM DEBT EQUITY RATIO 2. • TOTAL DEBT EQUITY RATIO 3. • PROPRIETORY RATIO 4. • FINANCIAL LEVERAGE 5. • DEBT SERVICE COVERAGE RATIO 6. • INTEREST COVERAGE RATIO 7. • PREFERENCE DIVIDEND COVERAGE RATIO
  31. 31. LONG TERM EQUITY DEBT 0.0005 0.0009 0.0050 0.0166 0.0062 2013 2012 2011 2010 2009 long term equity debt • As we can see from the graph that in all the years, company didn’t achieved the standard ratio i.e 2:1. •It shows that capital structure of the company is inadequate.
  32. 32. TOTAL DEBT EQUITY RATIO 0.15 0.21 0.23 0.15 0.29 2013 2012 2011 2010 2009 total debt equity ratio •overall we can say that company had fair mix of short and long term loan and equity. •It is highest in 2009, it shows that comapany is not relying only on equity or loans.
  33. 33. PROPRIETORY RATIO 0.56 0.53 0.46 0.61 0.76 2013 2012 2011 2010 2009 proprietory ratio •Except in 2009-2010 the ratio was more or less same. •In 2009, it is highest because funds and current assets have been invested appropriately.
  34. 34. FINANCIAL LEVERAGE 1.02 1.10 1.02 1.01 1.03 2013 2012 2011 2010 2009 financial leverage •There is not much increase and decrease in financial leverage because interest over the years is not increasing much. •It is lowest in 2010 so it was better for the company.
  35. 35. DEBT SERVICE COVERAGE RATIO 12.73 13.66 14.64 12.04 11.06 2013 2012 2011 2010 2009 Debt service coverage ratio •from the garph it is clear that debt service coverage ratio from 2009-2013 did not change much. •It shows that company was in a position to repay its loan in all the years.
  36. 36. INTEREST COVERAGE RATIO 37.10 38.53 45.94 83.88 32.15 2013 2012 2011 2010 2009 Interest coverage ratio •It is highest in 2010 because the amount of interest paid is minimum. •Interest coverage ratio shows drastic fluctuations from 2009-2010,as interset paid in 2010 was less in as compared to 2009. •After 2011, it declined as the amount of interest paid rises.
  37. 37. PREFERENCE DIVIDEND COVERAGE RATIO  As company didn’t had any preference share capital so no dividend in books of accounts.
  38. 38. SOLVENCY RATIO ANALYSIS  Long debt equity ratio was unsatisfactory as it couldn’t achieve the standard rate in any of the years.  Long term debt equity ratio and proprietary ratio was good.  Financial leverage and debt service coverage ratio was stable over the years.  Interest coverage ratio showed major fluctuations.  The company didn’t have fair mix of equity and debt.
  39. 39. OVERALL ANLAYSIS OF DABUR INDIA LTD..  Company had strong financial position to pay off its current liabilities.  After comparing balance sheet and profit and loss account of Dabur India ltd. From 2009-2013 we can say that 2009-2010 were the most profitable years for the company.  Major fluctuation were seen in 2011 as company made many changes in its operations like short term investments and increase in other operating expense.
  40. 40.  Company didn’t had adequate capital structure i.e it relied only on equity share capital rather than debts, a company should have fair mix of debt and equity both.  Assets of the company were less in 2009-2010 but still were most profitable for the company.

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