this ppt is very useful for MBA finance students

1. A study on financial ratio
analysis Salem District co-
operative milk producer
union Ltd., Salem.
L.S. Shyamraj,
3511310542,
II-MBA-J,
SRM university.

2. Objectives of the Study
• To determine the financial condition
and financial performance of the
firm.
• To compare balance sheets for the
financial year of 2008-2009 to 2012-
2013.
• To find solution to unfavorable
financial statements.

3. Problem of study
• Ratios are tools of quantitative
analysis, which ignore qualitative
point of view.
• Ratios give false result, if they are
calculated form incorrect accounting data.
• Ratios are calculated on the basis of
post data. Therefore, they do not
provided complete information for
future forecasting.

4. Industry profile
• Dairy is place where handling of milk and
milk products done.
• Handling of milk in cooperative milk unions
established all over the country on a small
scale in the early stages.
• About 95% of world buffalo milk (45.3 million
tons) is produced in Asia & pacific, while
64.4% is produced in India.

5. Company profile
• The Salem District Co- op Milk producers’
Union Ltd,. has been registered on
10.07.1978 and started functioning from
07-10-1978.
• Average 13,000 Liters of pure milk is
supplied for Chennai metro sales from Salem
diary.
• The company has ISO 9001-2000 certified
and ISI certified for the skimmed milk powder
production and the Salem diary ghee is sold
with AGMARK certificate.

6. Data collection method
• Primary data
• Personal contacts were made with the
executives and officials of the finance
division of “The Salem District Co-Op Milk
Producers” Union Ltd in the form of personal
discussion.

7. Data collection method
• SECONDARY DATA
The secondary data are collected from
Company reports, institute magazines,
department manuals, brochures mainly
from the balance sheet, income and
expenditure and periodicals etc.

8. Data analysis tool
• Profitability Ratios
• Return on investment ratio
• Return on capital employed ratio
• Return on total assets ratio
• Gross profit ratio
• Net profit ratio
• Operating ratio
• Operating profit ratio
• Operating expenses ratio
• Non-Operating expenses ratio
• Financial expenses ratio

9. Data analysis tool
• Turnover ratios
• Inventory turnover ratio
• Debtors turnover ratio
• Debtors collection period
• Creditors turnover ratio
• Creditors payment period
• Working capital turnover ratio
• Fixed assets Turnover ratio
• capital turnover ratio

10. Data analysis tools
• Solvency ratios
• Current ratio
• Liquid ratio
• Absolute liquid ratio

11. Findings
– Based on operating ratio the financial
performance of the company is not satisfactory
since the operating cost is closer to not sales.
The operating ratio of the firm
– Based on gross profit ratio the financial
performance of the company since to be
satisfactory. Because the gross profit ratio has
soon continues improvement.
– Based on financial expanses ratio the financial
performance the company is found to be good because in
the financial expanses dramatically improved

12. suggestions
• It has found that those the profitability ratio of
the company is passives but the operating
expenses ratio was not satisfactory. The
operating expenses ratio is very closer to the
knot sales therefore the company should
censer on ways and means to reduce to cost.
• Both the current ratio and liquid ratio fill below
the industry standard 2:1 to 1:1. This
indication that the company has to pay serious
attains towards its as current asset
management.

13. Conclusion
• The Salem district co-op milk producer’s
union Ltd. has been performing well in the
milk and milk product goods being one of
the union of the Salem district co-op milk
producer’s union Ltd. has been showing
an increasing trend in its profitability
position for the past 5 years which deficits
a good sign.

14. THANK YOU