Institute NMIMS

Program MBA
Year 2020
Subject Financial accounting
Project Name Analysing Company Ratios
Company
Competitor Ambuja Cement
Company ACC

Students Full name Roll No SAP ID

Karan Singh D020 80011220020
Manasa Tanam D022 80011220243
Rashi Jain D036 80011220117
Aman Kedia D003 80011220170
Isha Saini D016 80011220321
 BALANCE SHEET OF AMBUJA CEMENT
PARTICULARS 2017 2018 2019
ASSETS
1. Non-current assets
Property, plant and equipment 5693.45 5563.19 5633.62
Capital work in Progress 397.92 610.02 1108.7
Other tangible assets 28.54 100.41 178.83
Investment in subsidiries and Joint ventures 11815.1 11813.76 11789.01
Investments 29.6 0 0
Loans 66.52 60.34 62.9
Other financial assets 47.18 50.33 372.94
Non current tax assets 79.65 207.65 176.64
Other non current assets 967 1026.04 819.99
TOTAL 19124.96 19431.74 20142.63

2. Current assets
Inventories 1052.5 1277.76 954.07
Trade Recievables 307.97 470.26 513.22
Cash and Cash Equivalents 3310.64 3150.33 4512.29
Bank Balance 186.43 179.64 187.2
Loans 30.29 4.29 4.51
Other financial assets 66.69 84.71 228.87
Other current assets 537.65 587.95 423.19
Non-current assets classified as held for sale 0.06 0 24.75
Total - Current assets 5492.23 5754.94 6848.1
TOTAL - ASSETS 24617.19 25186.68 26990.73

EQUITY AND LIABILITIES

Equity share capital 397.13 397.13 397.13
Reserve and Surplus 19576.08 20615.4 21808.05
Liabilities
Non current Liabilites
Borrowings 24.12 39.68 35.28
Other financial liabilities 1.75 1.18 0.62
Provisions 35.23 38.53 50.34
Deferred tax liabilities 458.36 372.16 216.06
Other non current liabilities 7.19 7.17 35.83
Total-Non current liabilities 526.65 458.72 338.13

Current liabilities
Trade payables 1028.86 1109.46 935.98
Other financial liabilities 514.3 616.17 782.04
Other current liabilities 1490.93 1293.65 1737.81
Provisions 87.08 91.05 85.37
Current tax liabilites(Net) 996.16 605.1 906.22
Total Current Liabilities 4117.33 3715.43 4447.42
Total Liabilites 4643.98 4174.15 4785.55
Total EQUITY AND LIABILITIES 24617.19 25186.68 26990.73
HORIZONTAL ANALYSIS VERTICAL ANALYSIS
2018 2019 2017 2018 2019

-2.29% 1.27% 23.128% 22.088% 20.872%

53.30% 81.75% 1.616% 2.422% 4.108%
251.82% 78.10% 0.116% 0.399% 0.663%
-0.01% -0.21% 47.995% 46.905% 43.678%
-100.00% 0.120% 0.000% 0.000%
-9.29% 4.24% 0.270% 0.240% 0.233%
6.68% 640.99% 0.192% 0.200% 1.382%
160.70% -14.93% 0.324% 0.824% 0.654%
6.11% -20.08% 3.928% 4.074% 3.038%
1.60% 3.66% 77.689% 77.151% 74.628%

21.40% -25.33% 4.28% 5.07% 3.53%

52.70% 9.14% 1.25% 1.87% 1.90%
-4.84% 43.23% 13.45% 12.51% 16.72%
-3.64% 4.21% 0.76% 0.71% 0.69%
-85.84% 5.13% 0.12% 0.02% 0.02%
27.02% 170.18% 0.27% 0.34% 0.85%
9.36% -28.02% 2.18% 2.33% 1.57%
-100.00% 0.00% 0.00% 0.09%
4.78% 19.00% 22.31% 22.85% 25.37%
2.31% 7.16% 100.00% 100.00% 100.00%

0.00% 0.00% 1.61% 1.58% 1.47%

5.31% 5.79% 79.52% 81.85% 80.80%

64.51% -11.09% 0.10% 0.16% 0.13%

-32.57% -47.46% 0.01% 0.00% 0.00%
9.37% 30.65% 0.14% 0.15% 0.19%
-18.81% -41.94% 1.86% 1.48% 0.80%
-0.28% 399.72% 0.03% 0.03% 0.13%
-12.90% -26.29% 2.14% 1.82% 1.25%

7.83% -15.64% 4.18% 4.40% 3.47%

19.81% 26.92% 2.09% 2.45% 2.90%
-13.23% 34.33% 6.06% 5.14% 6.44%
4.56% -6.24% 0.35% 0.36% 0.32%
-39.26% 49.76% 4.05% 2.40% 3.36%
-9.76% 19.70% 16.73% 14.75% 16.48%
-10.12% 14.65% 18.86% 16.57% 17.73%
2.31% 7.16% 100.00% 100.00% 100.00%
 P/L OF Ambuja CEMENT
PARTICULARS 2017 2018 2019
INCOME
Revenue from operations 11214.87 11356.76 11667.88
Other Income 359.09 374.98 426.52
Total Income 11573.96 11731.74 12094.4

EXPENSES
Cost of materials consumed 909.33 1013.08 994.42
Changes in invenotries -62.83 -76.72 42.8
Excise duty 768.02 0 0
Employees benefit Expenses 661.37 679.57 672.63
Finance Cost 107.19 82.33 83.52
Depereciation and amortisation expenses 572.92 548.09 543.83
Power and fuel 2234.2 2549.69 2586.42
Freight and forwarding expense 2871.98 3277.57 3094.2
Purchase of stock in trade 0 5.96 88.27
Other expenses 1893.67 2017.14 2046.44
Self consumption of cement -1.01 -0.99 -6.15
Total expenses 9954.84 10095.72 10146.38

PROFIT BEFORE TAX 1619.12 1636.02 1948.02

Eceptional items 129.95 0
Tax expenses
For the current year
Current Tax 412 478 573
Deffered Tax - charge -18.33 -86.93 -153.52
Relating to earlier years
Current Tax -1.33 -372.01 0
Deffered Tax - charge -22.79 0 0
Total 369.55 19.06 419.48
PROFIT AFTER TAX 1249.57 1487.01 1528.54

Remeasurement gain on defined benefit plan 5.64 2.82 -6.97

Tax adjustment on above -2.23 -0.73 2.58
Total 3.41 2.09 -4.39

Total comprehensive income for the year 1252.98 1489.1 1524.15

EARNING PER SHARE
Basic 6.29 7.49 7.7
Diluted 6.29 7.49 7.7
HORIZONTAL ANALYSIS VERTICAL ANALYSIS
2018 2019 2017 2018 2019
1.27% 2.74% 100% 100% 100%
4.43% 13.74% 3% 3% 4%
1.36% 3.09% 103% 103% 104%

11.41% -1.8% 8.11% 8.92% 8.52%

22.11% -155.8% -0.56% -0.68% 0.37%
-100.00% 6.85% 0.00% 0.00%
2.75% -1.021% 5.90% 5.98% 5.76%
-23.19% 1.445% 0.96% 0.72% 0.72%
-4.33% -0.777% 5.11% 4.83% 4.66%
14.12% 1.441% 19.92% 22.45% 22.17%
14.12% -5.595% 25.61% 28.86% 26.52%
1381.040% 0.00% 0.05% 0.76%
6.52% 1.453% 16.89% 17.76% 17.54%
-1.98% 521.212% -0.01% -0.01% -0.05%
1.42% 0.502% 88.76% 88.90% 86.96%

1% 19% 14.44% 14.41% 16.70%

-100% 0.00% 1.14% 0.00%

16% 20% 3.67% 4.21% 4.91%

374% 77% -0.16% -0.77% -1.32%

27871% -100% -0.01% -3.28% 0.00%

-100% -0.20% 0.00% 0.00%
-95% 2101% 3.30% 0.17% 3.60%
19% 3% 11.14% 13.09% 13.10%

-50% -347% 0.05% 0.02% -0.06%

-67% -453% -0.02% -0.01% 0.02%
-39% -310% 0.03% 0.02% -0.04%

19% 2% 11% 13% 13%

19% 3% 0.06% 0.07% 0.07%

19% 3% 0.06% 0.07% 0.07%
 AMBUJ
PARTICULARS +BB3:E25+B3:E25 2017 2018 2019
ASSETS
1. Non-current assets
Property, plant and equipment 5693.45 5563.19 5633.62
Capital work in Progress 397.92 610.02 1108.7
Other tangible assets 28.54 100.41 178.83
Investment in subsidiries and Joint ventures 11815.1 11813.76 11789.01
Investments 29.6 0 0
Loans 66.52 60.34 62.9
Other financial assets 47.18 50.33 372.94
Non current tax assets 79.65 207.65 176.64
Other non current assets 967 1026.04 819.99
TOTAL 19124.96 19431.74 20142.63

2. Current assets
Inventories 1052.5 1277.76 954.07
Trade Recievables 307.97 470.26 513.22
Cash and Cash Equivalents 3310.64 3150.33 4512.29
Bank Balance 186.43 179.64 187.2

Loans 30.29 4.29 4.51

Other financial assets 66.69 84.71 228.87
Other current assets 537.65 587.95 423.19
Non-current assets classified as held for sale 0.06 0 24.75
Total - Current assets 5492.23 5754.94 6848.1
TOTAL - ASSETS 24617.19 25186.68 26990.73

EQUITY AND LIABILITIES

Equity share capital 397.13 397.13 397.13
Reserve and Surplus 19576.08 20615.4 21808.05
Liabilities

Non current Liabilites

Borrowings 24.12 39.68 35.28
Other financial liabilities 1.75 1.18 0.62
Provisions 35.23 38.53 50.34
Deferred tax liabilities 458.36 372.16 216.06
Other non current liabilities 7.19 7.17 35.83
Total-Non current liabilities 526.65 458.72 338.13

Current liabilities
Trade payables 1028.86 1109.46 935.98
Other financial liabilities 514.3 616.17 782.04
Other current liabilities 1490.93 1293.65 1737.81
Provisions 87.08 91.05 85.37
Current tax liabilites(Net) 996.16 605.1 906.22
Total Current Liabilities 4117.33 3715.43 4447.42
Total Liabilites 4643.98 4174.15 4785.55
Total EQUITY AND LIABILITIES 24617.19 25186.68 26990.73
 AMBUJA CEMENT
PARTICULARS 2017 2018 2019 Total Equity -
INCOME 2017
Revenue from operations 11214.87 11356.76 11667.88 2018
Other Income 359.09 374.98 426.52 2019
Total Income 11573.96 11731.74 12094.4 Current Ratio= Current
2017
EXPENSES 2018
Cost of materials consumed 909.33 1013.08 994.42 2019
Changes in invenotries -62.83 -76.72 42.8 Quick Ratio= (CA-Inven
Excise duty 768.02 0 0 2017
Employees benefit Expenses 661.37 679.57 672.63 2018
Finance Cost 107.19 82.33 83.52 2019
Depereciation and amortisation expenses 572.92 548.09 543.83
Power and fuel 2234.2 2549.69 2586.42
Freight and forwarding expense 2871.98 3277.57 3094.2
Purchase of stock in trade 0 5.96 88.27
Other expenses 1893.67 2017.14 2046.44
Self consumption of cement -1.01 -0.99 -6.15
Total expenses 9954.84 10095.72 10146.38 Net Profit ratio = Net P

2017
PROFIT BEFORE TAX 1619.12 1636.02 1948.02 2018
Eceptional items 129.95 0 2019
Tax expenses
For the current year DS0 = Closing AR*365/
Current Tax 412 478 573 2017
Deffered Tax - charge -18.33 -86.93 -153.52 2018
Relating to earlier years 2019
Current Tax -1.33 -372.01 0
Deffered Tax - charge -22.79 0 0 ROA = Net Income/ Ave
Total 369.55 19.06 419.48 2017

PROFIT AFTER TAX 1249.57 1487.01 1528.54 2018

2019
Remeasurement gain on defined benefit pl 5.64 2.82 -6.97
Tax adjustment on above -2.23 -0.73 2.58 ROE= Net income/Aver
Total 3.41 2.09 -4.39 2017
2018
Total comprehensive income for the year 1252.98 1489.1 1524.15 2019
EARNING PER SHARE
Basic 6.29 7.49 7.7
Diluted 6.29 7.49 7.7

ATO = Net sales/Averag

2017
2018
2019

Cash coverage for inter

2017
2018
2019
Total Equity -
19973.21 Calculation of COGAS
21012.53 4133.2
22205.18 2017
Current Ratio= Current assets/Current liabilites
1.33392999832416
1.54892973357054
1.53979160951743 Calcutaion of COGS
Quick Ratio= (CA-Inventory)/Current liabilities 3080.7
1.0783031722014
1.20502337549086
1.32526948208175

Net Profit ratio = Net Profit/Net sales Average Inventory

ITO =
COGS/Average
11.142% Inventory
13.094%
13.10%

DS0 = Closing AR*365/Net sales

10.0232147140359
15.113896921305
16.0547845881171

ROA = Net Income/ Average total assets

5.22%

5.97%
5.86%

ROE= Net income/Average shareholder equity

 7.617%
7.256%
7.074%

ATO = Net sales/Average total assets

0.469
0.456
0.447

Cash coverage for interest= (EBIT+Non cash charges)/Interest expenses

21.4500419815281
27.5287258593465
30.8353687739463
on of COGAS
4769.77 4665.98
2018 2019

on of COGS
3492.01 3711.91

Average Inventory= (Opening inv.+Closing inv.)/2

2017 2018 2019

995.02 1165.13 1115.92

3.09611867098149 2.997099 3.32634

NOTE:In the absence of complete data regarding

COGS for indian companies, COGS has been taken
as ,COGS=Cost of material consumed + Purchase of
stock-in-trade+ Changes in inventories + power and
fuel.
COGAS= COGS+ ENDING INVENTORY
Du Point analysis 2017 2018 2019
ROE as above 7.62% 7.26% 7.07%

ROA = PM*ATO 5.22% 5.97% 5.86%

2017 2018 2019

ROE=ROA*LEVERAGE 6.37% 7.26% 7.07%

Average total assets 2017 2018 2019

23984.98 24901.9 26088.7

Average Equity 19665.04 20492.9 21608.9

Levergae = avg total assets/average total equity 1.2196761 1.21515 1.20732

 BALANCE SHEET OF ACC CEMENT

PARTICULARS 2019
Assets
Non current assets
Property, Plant and Equipment 6957.28
Capital Work In Progress 435.34
Other Intangible assets 34.09
Investment in subsidaries,
associates and joint ventures 226.45
Investment 3.7

Loans 135.92
Other financial assets 468.23
Non current tax 857.01
Other current tax 540.78
Total non current assets 9658.8

Current assets
Inventories 1140.95
Trade recievables 628.43
Cash and cash equivalents 4383.18
Bank balance other than cash and
cash equivalents 154.92
Loans 31.43
Other financial assets 270.51
Other current assets 803.41
Non current assets classified as 7412.83
held for sale 10.47
Total current assets 7423.3
Total Assets 17082.1

Equity and liabilites

Equity share capital 187.99
Othe equity 11333.29

Total Equity 11521.28

Liabilities
Non current liabilities
Provisions 234.13
Deferred tax liabilities 642.21
Total non current liabilities 876.34

Current liabilities
Trade payable
Total outstanding
outstanding due of
to micro
Total due
and smallother
creditors enteprises
than micro and 11.27
small enteprises 1459.7
Other financial liabilities 933.96
Other current liabilities 1913.8
Provision 23.39
Current tax liabilities 342.36
Total current liabilities 4684.48
Total Liabilities 5560.82
Total - equity and liabilites 17082.1
 PROFIT AND LOSS A/C OF ACC CEMENT

PARTICULARS 2019 Current Ratios = Current assets/Current liabilities

INCOME 2019 1.58466
Revenue from operation 15656.65
Other Income 311.21 Quick Ratio= (CA-Inventory)/Current liabilities
Total Income 15967.86 2019 1.33886
EXPENSES

Cost of materials consumed 2258.1 Sales outstanding = (Closing AR*365)/Net Sales

Purchase of stock in trade 361.69 2019 14.6504

Changes in inventories of finished goods,

work in progress and stock in trade 100.81
Employee benefit expenses 863.97 Net Profit ratio = Net Profit/Net sales
Power and fuel 3131.34 2019 8.68%
Freight and forwarding expenses 4050.06
Finance cost 86.22 ROA = Net Income/ Average total assets
Depreciation and amortisation expenses 602.97 2019 8.21%
Other expenses 2483.55
13938.71 ROE= Net income/Average shareholder equity
Captive consumption of cement -2.32 2019 12.326%
Total expenses 13936.39

Profit before tax 2031.47

Tax expenses
Current tax 689.81
Deffered tax -17.25 ATO = Net sales/Average total assets
672.56 2019 94.582%
Profit for the yearof gains/loss on defined
Remeasurement 1358.91
benefit
Incometplans
tax relating to items that will -75.28 Cash coverage for interest= (EBIT+Non cash charges
not be reclassified to profit and loss 26.3 2019 31.5549
Total comprehensive income for the year 1309.93

Earning per equity share of Rs.10 each

Basic 72.36

Diluted 72.19
 COGAS 6992.89
ets/Current liabilities COGS 5851.94

Average inventory 1409.76

)/Current liabilities

average equity = 11024.47

g AR*365)/Net Sales

ITO = COGS/Average inventory

rofit/Net sales ITO 4.15103333557959

rage total assets

shareholder equity

ge total assets

(EBIT+Non cash charges)/Interest expenses

DU Point Analysis 2019

ROE as Above
ROA = PM*ATO 8.209%
ROE= ROA*Leverage 12.33%

Leverage= Average assets/average equity 1.50153023229235

Hence Matched
16553.6
 Financial Analysis

Liquidty Ratios
Liquidity ratios analysis gives a company its position on how it can efficiently meet its short-
term obligations.
This ratio often determines if a firm can pay its liabilities should they arise at any given point
of time.
Under this subsection, we shall analyze three components- Current ratio, Cash ratio, Debt
Ratio and Quick ratio and evaluate the position of Ambuja Company on its position.

Year/Ratio 2017 2018 2019

Current Ratio 1.3339299983 1.5489297336 1.5397916095
Quick Ratio 1.0783031722 1.2050233755 1.3252694821
Debt Ratio
Cash Ratio 0.8 0.84 1.0145

Current Ratio
1.6
1.55
1.5
Current Ratio

1.45 Row 6
1.4
1.35
1.3
1.25
1.2
1 2 3

The current ratio is a parameter that evaluates the company’s ability to meet its short-term obligatio
term asset value relative to the value of its short term liabilities.We can see that from 2107 to 2019

Quick Ratio
1.4
1.2
1
Row 7
Quick Ratio

0.8
0.6
0.4
 1.4
1.2
1
Row 7

Quick Ratio
0.8
0.6
0.4
0.2
0
1 2 3

Quick ratio assesses the extent to which cash and other currents assets can be readily converted int
assets as coverage for current liabilities.On the basis of 3 years we can see that the company is fully

Cash Ratio
1.2

0.8
Row 9
Cash Ratio

0.6

0.4

0.2

0
1 2 3

The cash ratio is a liquidity measure that shows a company's ability to cover its short-term obligation
on hand to pay off short term debt
 Profitability Ratios
Year/Ratios 2017 2018 2019
ROE 8% 7% 7%
ROA 5.22% 5.97% 5.86%
Net profit margi 11% 13% 13%

ROE
8%
8%
8%
8% Row 76
7%
ROE

7%
7%
7%
7%
6%
1 2 3

ROA
6.20%
6.00%
5.80% Row 77
5.60%
ROA

5.40%
5.20%
5.00%
4.80%
1 2 3

Net profit margin

14%
13%
13%
fit margin

12% Row 78
12%
 Net profit margin
14%
13%
13%

Net profit margin

12% Row 78
12%
11%
11%
10%
1 2 3

On the basis of Net profit ratio we can see that the company management is generating enough pro
indicates how profitable company is relative to its total assets. Thus company is being an at ideal rat
assets to generate earnings which remain consistent throughout the 3 years. ROE measures how
profits, analysing the cement industry we can say that has worse ROE which can be due to

Financial ratios analysis gives a true representation of a company’s financial health and soundness.
efficiency in all its operations. Results from profitability show how the company has advanced. The c
increasing the cost of sales due to low demand for its products. However, 2017 and 2018 they perfo
other thing the company should focus on improving their ROE.
 Financial Analysis

fficiently meet its short-

arise at any given point

ratio, Cash ratio, Debt

on its position.

y to meet its short-term obligations and the unforeseen cash demands. From the 3-year report, the company is capable of payin
can see that from 2107 to 2019 company current ratio has been static, which shows that the company is sufficiently using their
ets can be readily converted into cash and meet a company’s short-term obligations.The quick ratio is considered a more conse
an see that the company is fully equipped with exactly enough assets to be instantly liquidated to pay off its current liabilities.

o cover its short-term obligations using only cash and cash equivalents.From the past years we can see that the company strug

Comparison of Ambuja And ACC

Analysis of Ambuja and ACC we notice that, Ambuja is more financially stronger than ACC. Because their
investment in fixed asset is more than ACC. On comparision from the previous year data it is been observed
that the Ambuja cement growth is consistent but on the other hand ACC incurred loss. Ambuja cement DSO
is less than that of ACC. Also the overall expense of the Amnbuja cement is less than that of ACC.

ROA of ACC is
better than
that of Ambuja ROE of ACC cement for the current year
cement which is better than that of ROE of Ambuja
shows ACC is cement which means ACC is using its
using its assets investors' money more efficiently to
more enhance corporate performance and
efficiently than allow it to grow and expand to generate
ambuja. increasing profits
ement is generating enough profits based on revenue and the same has improved after 2017. ROA
company is being an at ideal rate that indicates that company's managemnet is efficient at using its
3 years. ROE measures how effectively management is using a company's assets to create
se ROE which can be due to excess debt as more debt company has lower equity can fall.

nancial health and soundness. During the past three years, despite fluctuations in its financial statement and the economy in g
he company has advanced. The company did not make much profits in 2017 as they were spending more on their expenses pro
ever, 2017 and 2018 they performed better and have improved in their finance’s management, managed their investment in t
t, the company is capable of paying its obligation beacuse it has comparitively large proportion of short
company is sufficiently using their current assets
k ratio is considered a more conservative measure than the current ratio, which includes all current
d to pay off its current liabilities.

e can see that the company struggled to keep their cash ratio idle until only 2019, which shows that the company had insufficie
an ACC. Because their
r data it is been observed
oss. Ambuja cement DSO
an that of ACC.
 l statement and the economy in general, Ambuja Company has achieved
nding more on their expenses profile, had huge investments in inventory,
nt, managed their investment in total assets concerning their sales. The
that the company had insufficient cash