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    Financial Analysis of Apollo Tyres LTD

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    aabha
    1) Apollo Tyres Ltd is analyzed to determine if it is a good investment. Ratios like current ratio and profit margin are examined to analyze liquidity and profitability. 2) While profit margins have varied over 5 years, profits have remained steady. However, the current ratio is low, indicating potential liquidity issues. 3) Overall the firm earns a profit each year and uses less debt than equity, though the low current ratio presents some investment risk.

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    Financial Analysis of Apollo Tyres LTD

    Uploaded by

    aabha
    213 views11 pages
    1) Apollo Tyres Ltd is analyzed to determine if it is a good investment. Ratios like current ratio and profit margin are examined to analyze liquidity and profitability. 2) While profit margins have varied over 5 years, profits have remained steady. However, the current ratio is low, indicating potential liquidity issues. 3) Overall the firm earns a profit each year and uses less debt than equity, though the low current ratio presents some investment risk.

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    1) Apollo Tyres Ltd is analyzed to determine if it is a good investment. Ratios like current ratio and profit margin are examined to analyze liquidity and profitability. 2) While profit margins have varied over 5 years, profits have remained steady. However, the current ratio is low, indicating potential liquidity issues. 3) Overall the firm earns a profit each year and uses less debt than equity, though the low current ratio presents some investment risk.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    213 views11 pages

    Financial Analysis of Apollo Tyres LTD

    Uploaded by

    aabha
    1) Apollo Tyres Ltd is analyzed to determine if it is a good investment. Ratios like current ratio and profit margin are examined to analyze liquidity and profitability. 2) While profit margins have varied over 5 years, profits have remained steady. However, the current ratio is low, indicating potential liquidity issues. 3) Overall the firm earns a profit each year and uses less debt than equity, though the low current ratio presents some investment risk.

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    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 11

    FINANCIAL ANALYSIS

    OF APOLLO TYRES
    LTD.

    Submitted By-
    1. Aabha Chaturvedi (501804001)
    2. Akshita Mahindra (501804008)
    3. Mohit Gupta (501804042)
    APOLLO TYRES LTD.
     Apollo Tyres Ltd is the world's 11th biggest tyre manufacturer,
    with annual consolidated revenues of Rs 146.74 billion (US$2.28
    billion) in March 2018. It was founded in 1972. Its first plant was
    commissioned in Perambra, Thrissur, Kerala, India. The company
    now has four manufacturing units in India, 1 in Netherlands and 1
    in Hungary. It has a network of nearly 5,000 dealerships in India,
    of which over 2,500 are exclusive outlets.
     It gets 69% of its revenues from India, 26% from Europe and 5%
    from other geographies.
     Apollo announced its entry into the two-wheeler tyre segment with
    contract manufacturing in March 2016. In November 2016, the
    company signed a MoU with the Government of Andhra Pradesh
    to set up a new factory in Andhra Pradesh to manufacture tyres for
    two-wheelers and pick-up trucks.
     The company’s second plant in Europe was inaugurated by the
    Hungarian Prime Minister, Viktor Orban, on April 2017
    FINANCIAL ANALYSIS
     THE FINANCIAL ANALYSIS OF THE FIRM IS NECESSARY TO KNOW
    WHETHER THE FIRM IS GOOD TO INVEST FOR INVESTORS. AS
    INVESTORS HAVE TO SEE WHETHER THE FIRM IS PROVIDING THE
    GOOD RETURNS, USING THEIR MONEY PROPERLY, USING LESS OF
    DEBT AND MORE OF EQUITY AND MAINLY SEEING THE PROFITABILITY
    AND LIQUIDITY OF THE FIRM.
     THE LIQUIDITY AND PROFITABLITY OF THE FIRM CAN BE DEPICTED BY
    USING THE CURRENT RATIO AND PROFIT MARGIN RATIO. CURRENT
    RATIO CAN BE USE TO KNOW THE LIQUIDITY OF THE FIRM & PROFIT
    MARGIN RATIO CAN BE USE TO KNOW PROFITABILITY OF THE FIRM.
     BOTH WILL HELP INVESTORS IN TAKING RATIONAL DECISION ABOUT
    WHETHER TO INVEST IN FIRM OR NOT.
    PROFITABILITY RATIOS
    Profit Margin Ratio Return on Equity
    12.000 0.25
    10.000 0.2
    8.000
    0.15
    6.000
    0.1
    4.000
    2.000 0.05

    0.000 0
    2014 2015 2016 2017 2018 2014 2015 2016 2017 2018

    Series1 Series2 Series3

    Return on Assets Earnings per Share


    0.12 20
    0.1
    15
    0.08
    0.06 10
    0.04
    0.02 5
    0
    2014 2015 2016 2017 2018 0
    2014 2015 2016 2017 2018
    INTERPRETATION OF
    PROFITABILITY RATIOS
     To know the profitability of the firm we can use the profit
    margin ratio to know whether it is good firm to invest for
    the investors or not.
     According to the graph, it can be depicted that the profit
    margin of the firm is not consistent. The profit Margin
    varies during all the five years. In 2018 profit has margin
    has decreased as compared to 2017.
    LIQUIDITY RATIO
    Current Ratio
    2

    0
    2014 2015 2016 2017 2018
    Current Ratio

    Quick ratio
    1.5
    1
    0.5
    0
    2014 2015 2016 2017 2018
    Quick ratio
    Interpretation of Liquidity
    Ratios
     Current ratio should be 2:1 but our current
    ratio is less than 2. So our company is not
    stable for short run as our current assets are
    less than our current liabilities.
     The ideal quick ratio is 1:1 and is considered
    to be appropriate. The liquidity position of
    the company is good as quick ratio is up to
    the mark.
    SOLVENCY RATIO

    Solvency Ratio
    0.6

    0.5

    0.4

    0.3

    0.2

    0.1

    0
    2014 2015 2016 2017 2018
    TURNOVER RATIO
    Recievables Turnover Ratio
    40
    35
    30
    25
    20
    15
    10
    5
    0
    2014 2015 2016 2017 2018

    Recievables Turnover Ratio

    Inventory Turnover Ratio


    9
    8
    7
    6
    5
    4
    3
    2
    1
    0
    2014 2015 2016 2017 2018

    Inventory Turnover Ratio


    CONCLUSION
    From the financial analysis of the firm it can be be concluded that: -
    ➢ The liquidity of the firm is not good. as the current ratio is less
    therefore, the firm is more riskier to invest for the investors.
    ➢ The profits of the firm are up to the mark as from 2014 to 2018 it has
    been seen that the profits are constant in all the five years.
    In the end it can be concluded that the firm is earning the profit in every
    financial year and they are performing well. as the use of debt is less than
    the use of equity which also make firm more secure to invest.

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