Description
This is a spreadsheet about Analysis of Bluestar.
Analysis for Bluestar
2005- 2009
Submitted to: Dr. Karamjeet Singh
Contents of the spreadsheet Balance Sheet Profit and loss account Cash Flow Yearly and trend analysis Ratio analysis Final analysis and conclusion
Submitted by: Name Roll No. Class Date of Submission: 08.03.2010
estar
mitted to: Karamjeet Singh
mitted by: Supreet Thind 35 MBA Biotech (A)
e of Submission:
Balance sheet BLUESTAR from 2005-2009
in Rs. Cr. 2005 Sources Of Funds Total Share Capital Equity Share Capital Reserves Networth Secured Loans Unsecured Loans Total Debt Liabilities Application Of Funds Gross Block Less: Accum. Depreciation Net Block Capital Work in Progress Investments Inventories Sundry Debtors Cash and Bank Balance Total Current Assets Loans and Advances Fixed Deposits Total CA, Loans & Advances Current Liabilities Provisions Total CL & Provisions Net Current Assets Miscellaneous Expenses Assets Contingent Liabilities Book Value (Rs) 17.99 17.99 130.79 148.78 35.91 1.37 37.28 186.06 164.21 87.28 76.93 7.28 5.18 102.66 195.77 2.19 300.62 68.92 0.29 369.83 255.64 21.93 277.57 92.26 4.42 186.07 41.14 82.71 2006 17.99 17.98 155.09 173.08 40.57 35.3 75.87 248.95 198.09 100.95 97.14 11.09 5.18 149.84 238.85 2.07 390.76 90.65 0.29 481.7 321.38 28.04 349.42 132.28 3.26 248.95 49.39 96.23 2007 17.99 17.99 195.34 213.33 39.05 50 89.05 302.38 231.17 116.73 114.44 2.41 5.3 188.08 350.68 3.81 542.57 85.65 0.8 629.02 352.21 98.83 451.04 177.98 2.25 302.38 65.92 23.72 2008 17.99 17.99 245.92 263.91 36.29 0.25 36.54 300.45 272.94 134.84 138.1 18.09 4.57 273.49 483.74 1.91 759.14 257.49 0.76 1,017.39 638.25 240.87 879.12 138.27 1.42 300.45 123.12 29.34 2009 17.99 17.99 349.5 367.49 22.52 1.08 23.6 391.09 332.87 144.92 187.95 24.79 4.38 207.3 643.08 4.8 855.18 292.68 0.85 1,148.71 672.97 302.37 975.34 173.37 0.6 391.09 47.7 40.86
Profit and loss Account of BLUESTAR from 2005-2009
in Rs. Cr. 2005 Income Sales Turnover Excise Duty Net Sales Other Income Stock Adjustments Total Income Expenditure Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Admin Expenses Miscellaneous Expenses Total Expenses Operating Profit PBDIT Interest PBDT Depreciation Profit Before Tax Extra-ordinary items PBT (Post Extra-ord Items) Tax Reported Net Profit Total Value Addition Equity Dividend Corporate Dividend Tax Per share data (annualised) Shares in issue (lakhs) Earning Per Share (Rs) Equity Dividend (%) Book Value (Rs) 916.88 0 916.88 9.17 26.96 953.01 743.99 3.81 72.55 1.3 49.84 13.56 885.05 58.79 67.96 3.21 64.75 12.42 52.33 0.26 52.59 13.28 39.16 141.05 17.99 2.56 179.87 21.77 100 82.71 2006 1,171.50 0 1,171.50 3.12 28.6 1,203.22 936.47 4.51 88.28 1.59 62.28 19.33 1,112.46 87.64 90.76 5.72 85.04 15.99 69.05 0.03 69.08 20.19 48.9 175.99 21.58 3.03 179.84 27.19 120 96.23 2007 1,594.58 0 1,594.58 9.72 26.85 1,631.15 1,269.55 5.83 123.16 2.37 81.67 25.95 1,508.53 112.9 122.62 9.55 113.07 20.9 92.17 0.42 92.59 21.42 71.18 238.98 26.98 3.94 899.36 7.91 150 23.72 2008 2,221.59 0 2,221.59 45.8 56.39 2,323.78 1,747.32 7.04 154.81 2.19 105.05 37.78 2,054.19 223.79 269.59 7.56 262.03 21.97 240.06 0.14 240.2 66.11 174.09 306.87 62.96 10.7 899.36 19.36 350 29.34 2009 2,552.29 0 2,552.29 4.75 -34.58 2,522.46 1,915.15 7.43 182.73 2.31 107.69 38.42 2,253.73 263.98 268.73 13.55 255.18 25.88 229.3 8.95 238.25 57.93 180.29 338.59 62.96 10.7 899.36 20.05 350 40.86
Cash flow of BLUESTAR from 2005-2009
Net Profit Before Tax Net Cash From Operating Activities Net Cash (used in)/from Investing Activities Net Cash (used in)/from Financing Activities Net (decrease)/increase In Cash and Cash Equivalents Opening Cash & Cash Equivalents Closing Cash & Cash Equivalents in Rs. Cr. 2005 52.44 15.34 -20.98 5.69 0.05 2.43 2.48 2006 69.09 18.36 -36.64 18.17 -0.11 2.48 2.37 2007 92.6 60.12 -23.72 -34.16 2.24 2.37 4.61 2008 242.02 133.78 -75.17 -60.55 -1.93 4.61 2.67 2009 238.22 169.72 -80.75 -86 2.98 2.67 5.65
Yearly and trend analysis BLUESTAR from 2005-2009
Yearly Results Sales Turnover Other Income Total Income Total Expenses Operating Profit Gross Profit Interest PBDT Depreciation PBT Tax Net Profit Earnings Per Share Equity Reserves Face Value Total Current Assets Total Assets Total Liabilities in Rs. Cr. 2005 920.77 10.15 930.92 862.92 57.85 68 3.21 64.79 12.35 52.44 13.28 39.16 21.77 17.99 130.43 10 300.62 186.07 186.06 2006 1,174.56 4.06 1,178.62 1,087.88 86.68 90.74 5.72 85.02 15.93 69.09 20.19 48.9 27.18 17.99 154.72 10 390.76 248.95 248.95 2007 1,601.28 6.13 1,607.41 1,484.37 116.91 123.04 9.55 113.49 20.9 92.59 21.41 71.18 7.91 17.99 194.98 2 542.57 302.38 302.38 2008 2,233.04 37.05 2,270.09 1,998.55 234.49 271.54 7.56 263.98 21.97 242.01 67.92 174.09 19.35 17.99 -2 759.14 300.45 300.45 2009 2,569.09 4.95 2,574.04 2,296.39 272.7 277.65 13.55 264.1 25.88 238.22 57.93 180.29 20.04 17.99 349.14 2 855.18 391.09 391.09
for those marked in pink did the trend analysis with base year as 2005
Trend analysis sales turnover net profit current assets total assets total liabilities in percentage 2005 100.00 100.00 100.00 100.00 100.00 2006 127.56 124.87 129.98 133.79 133.80 2007 173.91 181.77 180.48 162.51 162.52 2008 242.52 444.56 252.52 161.47 161.48 2009 279.02 460.39 284.47 210.18 210.20
Ratio Analysis of BLUESTAR from 2005-2009
YEARS Profitability Ratios
Operating Profit Margin(%) Profit Before Interest And Tax Margin(%) Gross Profit Margin(%) Return On Capital Employed(%) DU-PONT ANALYSIS Net Profit Margin(%) Asset turnover Return on asset 6.17 5.83 21.53 29.85 4.11 2.58 10.59 7.28 6.21 21.79 30.03 4.06 2.50 10.15 6.92 6.24 21.81 33.64 4.36 2.59 11.32
2005
2006
2007
Liquidity ratios
Current Ratio Quick Ratio cash ratio debtor turnover ratio average debt collection period (days) inventory turnover inventory holding period (Days) OPERATING CYCLE (days) 1.18 0.77 0.01 4.68 76.87 8.62 41.76 118.62 1.22 0.75 0.01 4.90 73.40 7.42 48.49 121.89 1.54 1.01 0.01 4.55 79.17 8.02 44.88 124.06
Solvency Ratios
Debt Equity Ratio Liabilities to equity ratio Interest Cover Equity ratio fixed asset to net worth ratio 2.07 16.28 17.30 0.05 4.28 4.22 22.09 13.07 0.04 5.40 4.95 24.53 10.65 0.03 6.36
Capital market ratios
Earnings Per Share Book Value 21.77 82.71 27.19 96.23 7.91 23.72
Investment Valuation Ratios
Face Value Dividend Per Share Operating Profit Per Share (Rs) Free Reserves Per Share (Rs) dividend payout ratio 10.0 10.0 32.7 72.7 0.5 10.0 12.0 48.7 86.2 0.4 2.0 3.0 12.6 21.7 0.4
2008
9.63 10.66 24.50 82.42 7.49 2.28 17.11
2009
10.47 9.63 23.78 62.10 7.15 2.20 15.69
1.19 0.76 0.00 4.59 78.39 7.51 47.93 126.32
1.27 0.96 0.01 3.97 90.71 10.87 33.11 123.82
2.03 37.51 32.75 0.02 7.68
1.31 38.72 17.92 0.02 10.45
19.36 29.34
20.05 40.86
2.0 7.0 24.9 27.3 0.4
2.0 7.0 29.4 38.9 0.3
1. TREND ANALYSIS of important 5 parameters
Trend Analysis
1600.00 1400.00 1200.00 Perventage 1000.00 800.00 600.00 400.00 200.00 0.00 2005 2006 2007 Year 2008 2009 total liabilities total assets current assets net profit sales turnover
The trend analysis of 5 parametres was done which are as follow: (i) total liablities: as it is an indicator of firms solvency and we can see in the 5 years it's measure has been increasing. The increase in liabilities alone cannot be a very good measure to evaluate solvency. We need to see its relation vis-a vis assets which can be seen in solvency ratios. (ii)total assets: its depicts change or growth in volume or size of company. As in the duration taken this measure has been increasing one can say that the company is growing in size. But here as well we need to evalute its relation with liabilities as well (iii) current assets: as they form a part of working capital this tells us how large the company is operating. As we see an increasing trend wecan say that company is increaseing its domain of working. (iv) sales : the rise in this domain depicts growth. Higher sales depicts higher operstions and larger turnover of the company.
2. RATIO ANALYSIS
Profitability Ratios
1 operating profit margin
Operating Profit Margin(%)
12.00 10.00 8.00 6.00 4.00 2.00 Operating Profit Margin(%)
0.00 2005 2006 2007 2008 2009
Operating profit marginindicates how effective a company is at controlling the costs and expenses associated with their normal business operations.A good operating margin is needed for a company to be able to pay for its fixed costs, such as interest on debt. As we can see a rising trend in this case hence we can say that company is working with efficiency. A dip in 2007 in the ratio colud be seen which might be dur to rise in raw material or other operating expenses 2 PBIT margin
Profit Before Interest And Tax Margin(%)
12.00 10.00 8.00 6.00 4.00 2.00 0.00 2005 2006 2007 2008 2009 Profit Before Interest And Tax Margin(%)
A high rise is seen in 2008. This could probably be becasuse rise in sales or other income This is followed by a dip in 2009 which could be accounted to recession and related issues 3 Gross profit margin
Gross Profit Margin(%)
25.00 24.00 23.00 22.00 21.00 20.00 2005 2006 2007 2008 2009 Gross Profit Margin(%)
Gross profit margin is a financial ratio used to assess the profitability of a firm's core activities, excluding fixed costs. It is a measure of how well each Re of a company's revenue is available to meet expenses and profits after paying for the goods or services that were sold.It indicates the relationship between net sales revenue and the cost of goods sold.A high gross profit margin indicates that a business can make a reasonable profit on sales, as long as it keeps overhead costs in control. As in operating profit margin a rise in 2008 is seen which indicates efficient control in overall cost. 4 return on capital employed
Return On Capital Employed(%)
90.00 80.00 70.00 60.00 50.00 40.00 30.00 20.00 10.00 0.00 2005 2006 2007 2008 2009
Return On Capital Employed(%)
It is a measure of the returns that a company is realising from its capital employed. It is commonly used as a measure for comparing the performance between businesses and for assessing whether a business generates enough returns to pay for its cost of capital. it should always be higher than the rate at which the company borrows, otherwise any increase in borrowing will reduce shareholders' earnings.hence one can again see higher returns in 2008 as compared to other years 5 Net profit margin
Net Profit Margin(%)
8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00 2005 2006 2007 2008 2009 Net Profit Margin(%)
It measures the amount of profit earned each Re of revenue. It was maximum in 2008 because of steep increase in sales in that year. However a dip ins ubsequent year could be because of price competitio or low demand or even recession. 6 Asset Turnover
Asset turnover
2.70 2.60 2.50 2.40 2.30 2.20 2.10 Asset turnover
2.10 2.00 1.90 2005 2006 2007 2008 2009
Asset turnover measures a firm's efficiency at using its assets in generating sales or revenue - the higher the number the better. It also indicates pricing strategy: companies with low profit margins tend to have high asset turnover, while those with high profit margins have low asset turnover.hence we can with a rise in profit margins in 2008 and 2009 there is decline in asset turnover ratio which implies a price competition in these years. 7 Return on Assets
Return on asset
18.00 16.00 14.00 12.00 10.00 8.00 6.00 4.00 2.00 0.00 2005 2006 2007 2008 2009
Return on asset
It IS an indicator of how profitable a company is relative to its total assets. ROA gives an idea as to how efficient management is at using its assets to generate earnings. In 2008 company sees a rise which is dedicated to the elevation in sales. Although it is not a nich emarket , but due to its specialized use one can say that the company enjoys higher profit margins and lower asset turnover.
Liquidity Ratios
1 Current Ratio
Current Ratio
1.80 1.60 1.40 1.20 1.00 0.80 0.60 0.40 0.20 0.00 2005 2006 2007 2008 2009
Current Ratio
It is aratio which is an indicator of company's ability to pay its debt in short term. It shows
the amount of Current asstes per Re of current liabilities. An ideal ratio is 2:1. but company always had a ratio between 1 and 1.6. So for this parameter company can be rated as satisfactory and not perfect. A rise in 2007 tells us that company has more CA to meet its liabilities. 2 Quick ratio
Quick Ratio
1.20 1.00 0.80 0.60 0.40 0.20 0.00 2005 2006 2007 2008 2009 Quick Ratio
It is an indicator of a company's short-term liquidity. The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets. The higher the quick ratio, the better the position of the company. Hence company is in more liquid position in 2007 and 2009 hence it can easily pay its short term obligations. 3 Cash Ratio
cash ratio
0.01 0.01 0.01 0.01 0.00 0.00 0.00 2005 2006 2007 2008 2009 cash ratio
The cash ratio is most commonly used as a measure of company liquidity. It can therefore determine if, and how quickly, the company can repay its short-term debt. Like quick ratio company has high cash ratio in 2007 , 2009 and 2005 as well. This means that company is in better position to take debt becauseA strong cash ratio is useful to creditors when deciding how much debt, if any, they would be willing to extend to the asking party. 4 debtor turnover ratio
debtor turnover ratio
6.00 5.00
5.00 4.00 3.00 2.00 1.00 0.00 2005 2006 2007 2008 2009 debtor turnover ratio
It measures the efficacy of a firms credit and collection policy and shows the number of times each year the debtor turns into cash. It provides some indicator of the quality of firms' debtors and collection efforts. A decline in this from 2006-2009 indicates a poor management of receivables and hence we can debtors are becoming less liquid. 5 Inventory turnover ratio
inventory turnover
12.00 10.00 8.00 6.00 4.00 2.00 0.00 2005 2006 2007 2008 2009 inventory turnover
This ratio shows the number of times a ccompany's inventory is turned into sales. Investment in inventories represents idle cash. We see a rise in the ratio in 2009 which indicates efficient management of inventory as now more frequently the stocks are sold and a lesser amount of money is required to finanace the inventory. A rise in 2009 is in line with rise in quich and cash ratio in 2009 because as more inventories is converted to cash higher the ratio is observed. 6 Inventory conversion period 7 Debt collection period 8 operating cycle
300.00 250.00 200.00 150.00 100.00 50.00 inventory holding period (Days) average debt collection period (days)
OPERATING CYCLE (days)
50.00 2005 2006 2007 2008 2009
As we see a rise in debt collection period a simultaneous rise in operating cycle is seen in 2009. But the efect has been diluted by lower invertory holding period. Hence we can say that although the company has improved its inventory management but its receivable management requires amnedmnents.
Solvency Ratios
1 Debt equity Ratio
Debt Equity Ratio
6.00 5.00 4.00 3.00 2.00 1.00 0.00 2005 2006 2007 2008 2009 Debt Equity Ratio
It indicates what proportion of equity and debt the company is using to finance its assets. A high debt/equity ratio generally means that a company has been aggressive in financing its growth with debt. This can result in volatile earnings as a result of the additional interest expense. This argument seems to ne true as the trend for this ratio almost maps the pattern of asset turnover. Also one can see hisher quick and cash ratio in 2007, the year where we had high debt-equity ratio, which marks the existence of aggressive policy during that year. 2 Liablities to equity Ratio
Liabilities to equity ratio
45.00 40.00 35.00 30.00 25.00 20.00 15.00 10.00 5.00 0.00 2005 2006 2007 2008 2009
Liabilities to equity ratio
It is a variant of debt equity ratio, which includes Current liabilities in the numerators. This ratio has increased during the period. This means that company has rising short term obligations. 3 Interest Cover
Interest Cover
35.00 30.00 25.00 20.00 15.00 10.00 5.00 0.00 2005 2006 2007 2008 2009 Interest Cover
This ratio used to determine how easily a company can pay interest on outstanding debt As the interest cover declined drasticallyin 2009 we can say that it is largely due to the rise in interest rate and hence interest expense 4 Equity Ratio
Equity ratio
0.06 0.05 0.04 0.03 0.02 0.01 0.00 2005 2006 2007 2008 2009 Equity ratio
The Equity Ratio is a good indicator of the level of leverage used by a company. ratio will produce good results for stockholders as long as the company earns a rate of equity return on assets that is greater than the interest rate paid to creditor. As we see declining rattio we can say that there is declining share of shareholders in the total capacity. 5 Fixed asset to net worth ratio
fixed asset to net worth ratio
12.00 10.00 8.00 6.00 4.00 2.00 fixed asset to net worth ratio
2.00 0.00 2005 2006 2007 2008 2009
It establishes the relationship between fixed asset and shareholders funds.This ratio indicates the extent to which the owners' cash is frozen in the form of brick and mortar and machinery, and the extent to which funds are available for the firm's operations. A rising ratio tells us that high level of shareholders funds are sunk into fixed assets and hence a lesser capital is provided by them as a part of working capital which hence makes them vunerable to changes in business climate.
Capital Market Ratio
1 Earnings per share
Earnings Per Share
30 25 20 15 10 5 0 2005 2006 2007 2008 2009 Earnings Per Share
It is the portion of a company's profit allocated to each outstanding share of common stock. A sharp decline is seen in 2007 which could be because of aggressive policy follwed by the company during that period which lead to lower EPS in that period.
Investment valuation Ratio
1 Dividend per share
Dividend Per Share
14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 2005 2006 2007 2008 2009 Dividend Per Share
Dividend per share is a simple and intuitive number. It is the amount of the dividend that shareholders have (or will) receive for each share they own. Here again a decrease is seen in 2007 owing to higher finanacing and aggressive approach of company in that
period. 2 Operating profit per share
Operating Profit Per Share (Rs)
60.0 50.0 40.0 30.0 20.0 10.0 0.0 2005 2006 2007 2008 2009 Operating Profit Per Share (Rs)
As the number of shares incresed to 899 lakhs form 179 lakhs in 2007 , we see a decline in the operating profit per share ratio. But as there is rise in operating profit in 2008 and 2009 we see a rise in ratio after 2007 3 Free reserves per share
Free Reserves Per Share (Rs)
100.0 80.0 60.0 40.0 20.0 0.0 2005 2006 2007 2008 2009 Free Reserves Per Share (Rs)
This graph also maps the same pattern as that of operating profit per share graph probably owing to sismilar reasons as stated above. 4 Dividend payout Ratio
dividend payout ratio
0.5 0.5 0.4 0.4 0.3 0.3 2005 2006 2007 2008 2009 dividend payout ratio
0.3 2005 2006 2007 2008 2009 It is calculated to find the extent to which earnings per share have been used for paying dividend
and to know what portion of earnings has been retained in the business.As this ratio is declining during that years we can safely say that company is in strong financial position. This is because lower the payout ratio, the higher will be the amount of earnings ploughed back in the business which indicates strong financial postion.
3. CONCLUSION
The most eventfull years in the duartion taken has been 2007 and 2008. Year 2008 was marked by profitability as we saw a rise in operating profit margin,PBIT margin, gross profit margin, return on cpital employed and return on assets. The year 2007 was an year of aggressive aggressive financing which saw a rise in debt equity ratio and number of shares and a decline in dividend per share, operating profit per share and free reserves per share.Also one can see improve invemtory management but a poor receivables management which is marked by increase in debt collection period and decrease in debt turnover ratio. Hence in short we can say that company started reaping the fruits of increased finacing in 2007 in the year 2008 and further. Also the decline in interest expense in2008 but rise in 2009 greatly impacted its interest coverage ratio . Finanlly the company needs to improve its receivable management.
doc_785542489.xlsx
This is a spreadsheet about Analysis of Bluestar.
Analysis for Bluestar
2005- 2009
Submitted to: Dr. Karamjeet Singh
Contents of the spreadsheet Balance Sheet Profit and loss account Cash Flow Yearly and trend analysis Ratio analysis Final analysis and conclusion
Submitted by: Name Roll No. Class Date of Submission: 08.03.2010
estar
mitted to: Karamjeet Singh
mitted by: Supreet Thind 35 MBA Biotech (A)
e of Submission:
Balance sheet BLUESTAR from 2005-2009
in Rs. Cr. 2005 Sources Of Funds Total Share Capital Equity Share Capital Reserves Networth Secured Loans Unsecured Loans Total Debt Liabilities Application Of Funds Gross Block Less: Accum. Depreciation Net Block Capital Work in Progress Investments Inventories Sundry Debtors Cash and Bank Balance Total Current Assets Loans and Advances Fixed Deposits Total CA, Loans & Advances Current Liabilities Provisions Total CL & Provisions Net Current Assets Miscellaneous Expenses Assets Contingent Liabilities Book Value (Rs) 17.99 17.99 130.79 148.78 35.91 1.37 37.28 186.06 164.21 87.28 76.93 7.28 5.18 102.66 195.77 2.19 300.62 68.92 0.29 369.83 255.64 21.93 277.57 92.26 4.42 186.07 41.14 82.71 2006 17.99 17.98 155.09 173.08 40.57 35.3 75.87 248.95 198.09 100.95 97.14 11.09 5.18 149.84 238.85 2.07 390.76 90.65 0.29 481.7 321.38 28.04 349.42 132.28 3.26 248.95 49.39 96.23 2007 17.99 17.99 195.34 213.33 39.05 50 89.05 302.38 231.17 116.73 114.44 2.41 5.3 188.08 350.68 3.81 542.57 85.65 0.8 629.02 352.21 98.83 451.04 177.98 2.25 302.38 65.92 23.72 2008 17.99 17.99 245.92 263.91 36.29 0.25 36.54 300.45 272.94 134.84 138.1 18.09 4.57 273.49 483.74 1.91 759.14 257.49 0.76 1,017.39 638.25 240.87 879.12 138.27 1.42 300.45 123.12 29.34 2009 17.99 17.99 349.5 367.49 22.52 1.08 23.6 391.09 332.87 144.92 187.95 24.79 4.38 207.3 643.08 4.8 855.18 292.68 0.85 1,148.71 672.97 302.37 975.34 173.37 0.6 391.09 47.7 40.86
Profit and loss Account of BLUESTAR from 2005-2009
in Rs. Cr. 2005 Income Sales Turnover Excise Duty Net Sales Other Income Stock Adjustments Total Income Expenditure Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Admin Expenses Miscellaneous Expenses Total Expenses Operating Profit PBDIT Interest PBDT Depreciation Profit Before Tax Extra-ordinary items PBT (Post Extra-ord Items) Tax Reported Net Profit Total Value Addition Equity Dividend Corporate Dividend Tax Per share data (annualised) Shares in issue (lakhs) Earning Per Share (Rs) Equity Dividend (%) Book Value (Rs) 916.88 0 916.88 9.17 26.96 953.01 743.99 3.81 72.55 1.3 49.84 13.56 885.05 58.79 67.96 3.21 64.75 12.42 52.33 0.26 52.59 13.28 39.16 141.05 17.99 2.56 179.87 21.77 100 82.71 2006 1,171.50 0 1,171.50 3.12 28.6 1,203.22 936.47 4.51 88.28 1.59 62.28 19.33 1,112.46 87.64 90.76 5.72 85.04 15.99 69.05 0.03 69.08 20.19 48.9 175.99 21.58 3.03 179.84 27.19 120 96.23 2007 1,594.58 0 1,594.58 9.72 26.85 1,631.15 1,269.55 5.83 123.16 2.37 81.67 25.95 1,508.53 112.9 122.62 9.55 113.07 20.9 92.17 0.42 92.59 21.42 71.18 238.98 26.98 3.94 899.36 7.91 150 23.72 2008 2,221.59 0 2,221.59 45.8 56.39 2,323.78 1,747.32 7.04 154.81 2.19 105.05 37.78 2,054.19 223.79 269.59 7.56 262.03 21.97 240.06 0.14 240.2 66.11 174.09 306.87 62.96 10.7 899.36 19.36 350 29.34 2009 2,552.29 0 2,552.29 4.75 -34.58 2,522.46 1,915.15 7.43 182.73 2.31 107.69 38.42 2,253.73 263.98 268.73 13.55 255.18 25.88 229.3 8.95 238.25 57.93 180.29 338.59 62.96 10.7 899.36 20.05 350 40.86
Cash flow of BLUESTAR from 2005-2009
Net Profit Before Tax Net Cash From Operating Activities Net Cash (used in)/from Investing Activities Net Cash (used in)/from Financing Activities Net (decrease)/increase In Cash and Cash Equivalents Opening Cash & Cash Equivalents Closing Cash & Cash Equivalents in Rs. Cr. 2005 52.44 15.34 -20.98 5.69 0.05 2.43 2.48 2006 69.09 18.36 -36.64 18.17 -0.11 2.48 2.37 2007 92.6 60.12 -23.72 -34.16 2.24 2.37 4.61 2008 242.02 133.78 -75.17 -60.55 -1.93 4.61 2.67 2009 238.22 169.72 -80.75 -86 2.98 2.67 5.65
Yearly and trend analysis BLUESTAR from 2005-2009
Yearly Results Sales Turnover Other Income Total Income Total Expenses Operating Profit Gross Profit Interest PBDT Depreciation PBT Tax Net Profit Earnings Per Share Equity Reserves Face Value Total Current Assets Total Assets Total Liabilities in Rs. Cr. 2005 920.77 10.15 930.92 862.92 57.85 68 3.21 64.79 12.35 52.44 13.28 39.16 21.77 17.99 130.43 10 300.62 186.07 186.06 2006 1,174.56 4.06 1,178.62 1,087.88 86.68 90.74 5.72 85.02 15.93 69.09 20.19 48.9 27.18 17.99 154.72 10 390.76 248.95 248.95 2007 1,601.28 6.13 1,607.41 1,484.37 116.91 123.04 9.55 113.49 20.9 92.59 21.41 71.18 7.91 17.99 194.98 2 542.57 302.38 302.38 2008 2,233.04 37.05 2,270.09 1,998.55 234.49 271.54 7.56 263.98 21.97 242.01 67.92 174.09 19.35 17.99 -2 759.14 300.45 300.45 2009 2,569.09 4.95 2,574.04 2,296.39 272.7 277.65 13.55 264.1 25.88 238.22 57.93 180.29 20.04 17.99 349.14 2 855.18 391.09 391.09
for those marked in pink did the trend analysis with base year as 2005
Trend analysis sales turnover net profit current assets total assets total liabilities in percentage 2005 100.00 100.00 100.00 100.00 100.00 2006 127.56 124.87 129.98 133.79 133.80 2007 173.91 181.77 180.48 162.51 162.52 2008 242.52 444.56 252.52 161.47 161.48 2009 279.02 460.39 284.47 210.18 210.20
Ratio Analysis of BLUESTAR from 2005-2009
YEARS Profitability Ratios
Operating Profit Margin(%) Profit Before Interest And Tax Margin(%) Gross Profit Margin(%) Return On Capital Employed(%) DU-PONT ANALYSIS Net Profit Margin(%) Asset turnover Return on asset 6.17 5.83 21.53 29.85 4.11 2.58 10.59 7.28 6.21 21.79 30.03 4.06 2.50 10.15 6.92 6.24 21.81 33.64 4.36 2.59 11.32
2005
2006
2007
Liquidity ratios
Current Ratio Quick Ratio cash ratio debtor turnover ratio average debt collection period (days) inventory turnover inventory holding period (Days) OPERATING CYCLE (days) 1.18 0.77 0.01 4.68 76.87 8.62 41.76 118.62 1.22 0.75 0.01 4.90 73.40 7.42 48.49 121.89 1.54 1.01 0.01 4.55 79.17 8.02 44.88 124.06
Solvency Ratios
Debt Equity Ratio Liabilities to equity ratio Interest Cover Equity ratio fixed asset to net worth ratio 2.07 16.28 17.30 0.05 4.28 4.22 22.09 13.07 0.04 5.40 4.95 24.53 10.65 0.03 6.36
Capital market ratios
Earnings Per Share Book Value 21.77 82.71 27.19 96.23 7.91 23.72
Investment Valuation Ratios
Face Value Dividend Per Share Operating Profit Per Share (Rs) Free Reserves Per Share (Rs) dividend payout ratio 10.0 10.0 32.7 72.7 0.5 10.0 12.0 48.7 86.2 0.4 2.0 3.0 12.6 21.7 0.4
2008
9.63 10.66 24.50 82.42 7.49 2.28 17.11
2009
10.47 9.63 23.78 62.10 7.15 2.20 15.69
1.19 0.76 0.00 4.59 78.39 7.51 47.93 126.32
1.27 0.96 0.01 3.97 90.71 10.87 33.11 123.82
2.03 37.51 32.75 0.02 7.68
1.31 38.72 17.92 0.02 10.45
19.36 29.34
20.05 40.86
2.0 7.0 24.9 27.3 0.4
2.0 7.0 29.4 38.9 0.3
1. TREND ANALYSIS of important 5 parameters
Trend Analysis
1600.00 1400.00 1200.00 Perventage 1000.00 800.00 600.00 400.00 200.00 0.00 2005 2006 2007 Year 2008 2009 total liabilities total assets current assets net profit sales turnover
The trend analysis of 5 parametres was done which are as follow: (i) total liablities: as it is an indicator of firms solvency and we can see in the 5 years it's measure has been increasing. The increase in liabilities alone cannot be a very good measure to evaluate solvency. We need to see its relation vis-a vis assets which can be seen in solvency ratios. (ii)total assets: its depicts change or growth in volume or size of company. As in the duration taken this measure has been increasing one can say that the company is growing in size. But here as well we need to evalute its relation with liabilities as well (iii) current assets: as they form a part of working capital this tells us how large the company is operating. As we see an increasing trend wecan say that company is increaseing its domain of working. (iv) sales : the rise in this domain depicts growth. Higher sales depicts higher operstions and larger turnover of the company.
2. RATIO ANALYSIS
Profitability Ratios
1 operating profit margin
Operating Profit Margin(%)
12.00 10.00 8.00 6.00 4.00 2.00 Operating Profit Margin(%)
0.00 2005 2006 2007 2008 2009
Operating profit marginindicates how effective a company is at controlling the costs and expenses associated with their normal business operations.A good operating margin is needed for a company to be able to pay for its fixed costs, such as interest on debt. As we can see a rising trend in this case hence we can say that company is working with efficiency. A dip in 2007 in the ratio colud be seen which might be dur to rise in raw material or other operating expenses 2 PBIT margin
Profit Before Interest And Tax Margin(%)
12.00 10.00 8.00 6.00 4.00 2.00 0.00 2005 2006 2007 2008 2009 Profit Before Interest And Tax Margin(%)
A high rise is seen in 2008. This could probably be becasuse rise in sales or other income This is followed by a dip in 2009 which could be accounted to recession and related issues 3 Gross profit margin
Gross Profit Margin(%)
25.00 24.00 23.00 22.00 21.00 20.00 2005 2006 2007 2008 2009 Gross Profit Margin(%)
Gross profit margin is a financial ratio used to assess the profitability of a firm's core activities, excluding fixed costs. It is a measure of how well each Re of a company's revenue is available to meet expenses and profits after paying for the goods or services that were sold.It indicates the relationship between net sales revenue and the cost of goods sold.A high gross profit margin indicates that a business can make a reasonable profit on sales, as long as it keeps overhead costs in control. As in operating profit margin a rise in 2008 is seen which indicates efficient control in overall cost. 4 return on capital employed
Return On Capital Employed(%)
90.00 80.00 70.00 60.00 50.00 40.00 30.00 20.00 10.00 0.00 2005 2006 2007 2008 2009
Return On Capital Employed(%)
It is a measure of the returns that a company is realising from its capital employed. It is commonly used as a measure for comparing the performance between businesses and for assessing whether a business generates enough returns to pay for its cost of capital. it should always be higher than the rate at which the company borrows, otherwise any increase in borrowing will reduce shareholders' earnings.hence one can again see higher returns in 2008 as compared to other years 5 Net profit margin
Net Profit Margin(%)
8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00 2005 2006 2007 2008 2009 Net Profit Margin(%)
It measures the amount of profit earned each Re of revenue. It was maximum in 2008 because of steep increase in sales in that year. However a dip ins ubsequent year could be because of price competitio or low demand or even recession. 6 Asset Turnover
Asset turnover
2.70 2.60 2.50 2.40 2.30 2.20 2.10 Asset turnover
2.10 2.00 1.90 2005 2006 2007 2008 2009
Asset turnover measures a firm's efficiency at using its assets in generating sales or revenue - the higher the number the better. It also indicates pricing strategy: companies with low profit margins tend to have high asset turnover, while those with high profit margins have low asset turnover.hence we can with a rise in profit margins in 2008 and 2009 there is decline in asset turnover ratio which implies a price competition in these years. 7 Return on Assets
Return on asset
18.00 16.00 14.00 12.00 10.00 8.00 6.00 4.00 2.00 0.00 2005 2006 2007 2008 2009
Return on asset
It IS an indicator of how profitable a company is relative to its total assets. ROA gives an idea as to how efficient management is at using its assets to generate earnings. In 2008 company sees a rise which is dedicated to the elevation in sales. Although it is not a nich emarket , but due to its specialized use one can say that the company enjoys higher profit margins and lower asset turnover.
Liquidity Ratios
1 Current Ratio
Current Ratio
1.80 1.60 1.40 1.20 1.00 0.80 0.60 0.40 0.20 0.00 2005 2006 2007 2008 2009
Current Ratio
It is aratio which is an indicator of company's ability to pay its debt in short term. It shows
the amount of Current asstes per Re of current liabilities. An ideal ratio is 2:1. but company always had a ratio between 1 and 1.6. So for this parameter company can be rated as satisfactory and not perfect. A rise in 2007 tells us that company has more CA to meet its liabilities. 2 Quick ratio
Quick Ratio
1.20 1.00 0.80 0.60 0.40 0.20 0.00 2005 2006 2007 2008 2009 Quick Ratio
It is an indicator of a company's short-term liquidity. The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets. The higher the quick ratio, the better the position of the company. Hence company is in more liquid position in 2007 and 2009 hence it can easily pay its short term obligations. 3 Cash Ratio
cash ratio
0.01 0.01 0.01 0.01 0.00 0.00 0.00 2005 2006 2007 2008 2009 cash ratio
The cash ratio is most commonly used as a measure of company liquidity. It can therefore determine if, and how quickly, the company can repay its short-term debt. Like quick ratio company has high cash ratio in 2007 , 2009 and 2005 as well. This means that company is in better position to take debt becauseA strong cash ratio is useful to creditors when deciding how much debt, if any, they would be willing to extend to the asking party. 4 debtor turnover ratio
debtor turnover ratio
6.00 5.00
5.00 4.00 3.00 2.00 1.00 0.00 2005 2006 2007 2008 2009 debtor turnover ratio
It measures the efficacy of a firms credit and collection policy and shows the number of times each year the debtor turns into cash. It provides some indicator of the quality of firms' debtors and collection efforts. A decline in this from 2006-2009 indicates a poor management of receivables and hence we can debtors are becoming less liquid. 5 Inventory turnover ratio
inventory turnover
12.00 10.00 8.00 6.00 4.00 2.00 0.00 2005 2006 2007 2008 2009 inventory turnover
This ratio shows the number of times a ccompany's inventory is turned into sales. Investment in inventories represents idle cash. We see a rise in the ratio in 2009 which indicates efficient management of inventory as now more frequently the stocks are sold and a lesser amount of money is required to finanace the inventory. A rise in 2009 is in line with rise in quich and cash ratio in 2009 because as more inventories is converted to cash higher the ratio is observed. 6 Inventory conversion period 7 Debt collection period 8 operating cycle
300.00 250.00 200.00 150.00 100.00 50.00 inventory holding period (Days) average debt collection period (days)
OPERATING CYCLE (days)
50.00 2005 2006 2007 2008 2009
As we see a rise in debt collection period a simultaneous rise in operating cycle is seen in 2009. But the efect has been diluted by lower invertory holding period. Hence we can say that although the company has improved its inventory management but its receivable management requires amnedmnents.
Solvency Ratios
1 Debt equity Ratio
Debt Equity Ratio
6.00 5.00 4.00 3.00 2.00 1.00 0.00 2005 2006 2007 2008 2009 Debt Equity Ratio
It indicates what proportion of equity and debt the company is using to finance its assets. A high debt/equity ratio generally means that a company has been aggressive in financing its growth with debt. This can result in volatile earnings as a result of the additional interest expense. This argument seems to ne true as the trend for this ratio almost maps the pattern of asset turnover. Also one can see hisher quick and cash ratio in 2007, the year where we had high debt-equity ratio, which marks the existence of aggressive policy during that year. 2 Liablities to equity Ratio
Liabilities to equity ratio
45.00 40.00 35.00 30.00 25.00 20.00 15.00 10.00 5.00 0.00 2005 2006 2007 2008 2009
Liabilities to equity ratio
It is a variant of debt equity ratio, which includes Current liabilities in the numerators. This ratio has increased during the period. This means that company has rising short term obligations. 3 Interest Cover
Interest Cover
35.00 30.00 25.00 20.00 15.00 10.00 5.00 0.00 2005 2006 2007 2008 2009 Interest Cover
This ratio used to determine how easily a company can pay interest on outstanding debt As the interest cover declined drasticallyin 2009 we can say that it is largely due to the rise in interest rate and hence interest expense 4 Equity Ratio
Equity ratio
0.06 0.05 0.04 0.03 0.02 0.01 0.00 2005 2006 2007 2008 2009 Equity ratio
The Equity Ratio is a good indicator of the level of leverage used by a company. ratio will produce good results for stockholders as long as the company earns a rate of equity return on assets that is greater than the interest rate paid to creditor. As we see declining rattio we can say that there is declining share of shareholders in the total capacity. 5 Fixed asset to net worth ratio
fixed asset to net worth ratio
12.00 10.00 8.00 6.00 4.00 2.00 fixed asset to net worth ratio
2.00 0.00 2005 2006 2007 2008 2009
It establishes the relationship between fixed asset and shareholders funds.This ratio indicates the extent to which the owners' cash is frozen in the form of brick and mortar and machinery, and the extent to which funds are available for the firm's operations. A rising ratio tells us that high level of shareholders funds are sunk into fixed assets and hence a lesser capital is provided by them as a part of working capital which hence makes them vunerable to changes in business climate.
Capital Market Ratio
1 Earnings per share
Earnings Per Share
30 25 20 15 10 5 0 2005 2006 2007 2008 2009 Earnings Per Share
It is the portion of a company's profit allocated to each outstanding share of common stock. A sharp decline is seen in 2007 which could be because of aggressive policy follwed by the company during that period which lead to lower EPS in that period.
Investment valuation Ratio
1 Dividend per share
Dividend Per Share
14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 2005 2006 2007 2008 2009 Dividend Per Share
Dividend per share is a simple and intuitive number. It is the amount of the dividend that shareholders have (or will) receive for each share they own. Here again a decrease is seen in 2007 owing to higher finanacing and aggressive approach of company in that
period. 2 Operating profit per share
Operating Profit Per Share (Rs)
60.0 50.0 40.0 30.0 20.0 10.0 0.0 2005 2006 2007 2008 2009 Operating Profit Per Share (Rs)
As the number of shares incresed to 899 lakhs form 179 lakhs in 2007 , we see a decline in the operating profit per share ratio. But as there is rise in operating profit in 2008 and 2009 we see a rise in ratio after 2007 3 Free reserves per share
Free Reserves Per Share (Rs)
100.0 80.0 60.0 40.0 20.0 0.0 2005 2006 2007 2008 2009 Free Reserves Per Share (Rs)
This graph also maps the same pattern as that of operating profit per share graph probably owing to sismilar reasons as stated above. 4 Dividend payout Ratio
dividend payout ratio
0.5 0.5 0.4 0.4 0.3 0.3 2005 2006 2007 2008 2009 dividend payout ratio
0.3 2005 2006 2007 2008 2009 It is calculated to find the extent to which earnings per share have been used for paying dividend
and to know what portion of earnings has been retained in the business.As this ratio is declining during that years we can safely say that company is in strong financial position. This is because lower the payout ratio, the higher will be the amount of earnings ploughed back in the business which indicates strong financial postion.
3. CONCLUSION
The most eventfull years in the duartion taken has been 2007 and 2008. Year 2008 was marked by profitability as we saw a rise in operating profit margin,PBIT margin, gross profit margin, return on cpital employed and return on assets. The year 2007 was an year of aggressive aggressive financing which saw a rise in debt equity ratio and number of shares and a decline in dividend per share, operating profit per share and free reserves per share.Also one can see improve invemtory management but a poor receivables management which is marked by increase in debt collection period and decrease in debt turnover ratio. Hence in short we can say that company started reaping the fruits of increased finacing in 2007 in the year 2008 and further. Also the decline in interest expense in2008 but rise in 2009 greatly impacted its interest coverage ratio . Finanlly the company needs to improve its receivable management.
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