Description
This is a PPT about the company analysis of tata motors.
TATA
Tata Motors
?
? ?
?
? ?
Industry Established Founder Chairman Headquarter Revenues
Employees
?
: Automobile Company. : 1945 . JRD Tata. Ratan Tata Mumbai (India). Rs.70,938.85 crores (2008-09) 23,000.
Cont….
?
?
?
It’s a Dual Listed Company (BSE & NYSE). Manufacturing and Assembly Plant at Jamshedpur, Pantnagar, Lucknow, Ahmedabad and Pune in India. Also in, Argentina, South Africa and Thailand.
Products
? ? ?
?
Cars and utility vehicles Concept vehicles Commercial vehicles Military vehicles
INCOME STATEMENT OF TATA MOTORS (currency in million Rs.) (2007) Revenues Other Revenues TOTAL REVENUES Cost of Goods Sold GROSS PROFIT 323,612.0 19.6 325,143.8 234,753.6 90,390.2 (2008) 356,514.8 65.0 358,086.0 254,571.5 103,514.5
Selling General & Admin Expenses
R&D Expenses Depreciation & Amortization, Total Other Operating Expenses
30,811.0
850.2 6,880.9 17,508.5
35,136.3
659.5 7,820.7 24,046.6
OPERATING INCOME
OTHER OPERATING EXPENSES, TOTAL Interest Expense Interest and Investment Income
34,339.6
56,050.6 -4,650.6 592.5
35,851.4
67,663.1 -9,127.2 1,696.6
Liquidity ratio
Current ratio = Current assets / Current liability
2008
?
2007 162,779.2 127,633.7
Current Assets Current Liability Current Ratio (2008) Current Ratio (2007) Quick Ratio (2008) Quick Ratio (2007)
192,673.5 188,948.8 192,673.5/ 188,948.8 = 1.01 162,779.2/ 127,633.7 = 1.27
?
?
?
?
C.A. - Invent. / C.L. 192,673.5 - 32,946.4 / 188,948.8 = .85 162,779.2- 31,669.0/127,633.7 = 1.02
?
Cont…
?
Interval measure = Current assets-inven. / avg. daily cash oper. Exp For 2008 : Avg. daily cash oper. Exp.Interval measure Total cash exp./ 365 67,663.1/ 365 = 185.3 192,673.5 - 32,946.4 / 185.3 = 862 days 56,050.6/ 365 = 153.5 162,779.2- 31,669.0 / 153.5 = 854 days
?
?
? ?
For 2007 : Avg. daily cash oper. Exp Interval measure -
In liquidity ratio, we observe that current ratio in 2008 is less in comparison of 2007. it means companies efficiency decreases in paying current liability. And in quick ratio, it also decreases. In 2008, regular cash meet was 862 days in comparison of 854 of 2007. It means firms ability to pay its daily exp. Increases.
Leverage Ratio
?
Total debt ratio For 2008 Total debt Capital employed Or For 2007 Total debt Capital employed
:
Total debt / capital employed
?
? ?
: :
63,345.5 Net worth + borrowing Share capital + debt. 86,975.2+ 63,345.5= 150320.7 63,345.5 / 150320.7 = .42 38,693.6 77,216.7 + 38,693.6= 115910.3 (shr. cap) (debt) 38,693.6 / 115910.3 = .33
? ? ?
: :
Cont…
?
Debt equity ratio For 2008 For 2007 Capital equity ratio -
-
? ?
Net worth / total debt Net worth = share cap. 86,975.2/63,345.5 = 1.37 77,216.7 /38,693.6 = 1.99 Capital employed / net worth
?
? ?
For 2008 For 2007
150320.7 / 86,975.2= 1.73 115910.3 / 77,216.7 = 1.50
Interest coverage ratio – EBIT + depreciation / Intere
? ? ?
Earning before tax Add- Interest Total
2008 30,448.3 9,127.2 39575.5
2007 31,326.4 4,650.6 35977
Cont….
?
For 2008 : For 2007 :
39575.5 + 7,820.7/9,127.2 = 5.19 35977 + 6,880.9 / 4,650.6= 9.21
?
? ? ? ? ?
In 2008, the long term financial position getting strong than 2008. Capability of paying long term debt. is increases. As we seen, debt ratio increases. And the contribution of debt is increases in 2008 than 2007. and the part of share capital is Also increases in total capital employed than 2007. it means, company is increasing Its capital through shares.
Activity Ratio
Inventory Turnover Ratio = Cost of goods sold / Inventory (2008)
? ?
(2007) 234,753.6 31,669.0 = = 7.72 7.41
Cost of goods sold : Inventory : For 2008 For 2007 : :
254,571.5 32,946.4
?
254,571.5 / 32,946.4 234,753.6 / 31,669.0
?
Cont…
Debtor Turnover Ratio =
?
Sales / debtor 358,086.0 (sales) / 97,555.9 (debtor) 325,143.8 (sales) / 101,638.5 (debtor) (2008) = 360 / 3.67 = 98 days (2007) = 360 / 3.20 = 112 days Sales / Net assets or capital employed 358,086.0 (sales) / 150320.7 (c.e.) 325,143.8 (sales) / 115910.3 (c.e.) = 2.38 = 2.80 = 3.67 = 3.20
For 2008 : For 2007 : Average collection period Average collection period Assets Turnover Ratio : For 2008 : For 2007 :
?
?
?
?
?
?
Cont…
Working Capital Turnover Ratio =
?
Sales / Net working capital Current assets – Current liability 192,673.5 - 188,948.8 = 3724.7 162,779.2 - 127,633.7 = 35145.5
Net Working Capital For 2008 : For 2007 : For 2008 : For 2007 :
= = =
? ?
?
358,086.0 (sales) / 3724.7 (N.W.C.) =
96.13
?
325,143.8 (sales) / 35145.5 (N.W.C) = 09.25
As we seen, company’s efficiency of using its assets is increasing in 2008 than 2007. The inventory turnover ratio which shows its efficiency of selling product is increasing. Average collection period is decreasing means company is selling its product more on cash basis in 2008 than 2007. but company’s assets turnover ratio is decreasing means sales is not growing according to its capital employed and working capital.
Profitability Ratio
? ? ? ? ? ?
?
? ?
Gross Margin = Gross Margin (2008) = Gross Margin (2007) = EBIT Ratio = For 2008 = For 2007 = Return on investment= For 2008 = For 2007 =
Gross profit / Sales 103,514.5 / 358,086.0 = 90,390.2 / 325,143.8 = PAT / EBIT 21,677.0 / 37878.9 = 21,699.9 / 35384.5 = EBIT / Capital employed 39575.5 / 150320.7 = 35977 / 115910.3 =
.29 .28
.57 .61 .26 .31
Cont….
?
Return on equity For 2008 For 2007
= = =
PAT / Net worth 21,677.0 / 86,975.2 = 21,699.9 / 77,216.7 = .25 .28
? ?
In profitability ratio, the gross profit ratio is increasing in 2008 than 2007. it means its profit is growing in sales. But company’s EBIT ratio is decreasing means interest on capital and tax rate is increased in 2008 than 2007 which is responsible in decreasing its PAT. And company’s return on investment is decreased that indicates that its earning on capital employed is decreased in 2008 than 2007. and its ROE is also decreases means its PAT on its share capital is decreased.
THANK YOU
ANY QUESTION ???????????
doc_440408979.ppt
This is a PPT about the company analysis of tata motors.
TATA
Tata Motors
?
? ?
?
? ?
Industry Established Founder Chairman Headquarter Revenues
Employees
?
: Automobile Company. : 1945 . JRD Tata. Ratan Tata Mumbai (India). Rs.70,938.85 crores (2008-09) 23,000.
Cont….
?
?
?
It’s a Dual Listed Company (BSE & NYSE). Manufacturing and Assembly Plant at Jamshedpur, Pantnagar, Lucknow, Ahmedabad and Pune in India. Also in, Argentina, South Africa and Thailand.
Products
? ? ?
?
Cars and utility vehicles Concept vehicles Commercial vehicles Military vehicles
INCOME STATEMENT OF TATA MOTORS (currency in million Rs.) (2007) Revenues Other Revenues TOTAL REVENUES Cost of Goods Sold GROSS PROFIT 323,612.0 19.6 325,143.8 234,753.6 90,390.2 (2008) 356,514.8 65.0 358,086.0 254,571.5 103,514.5
Selling General & Admin Expenses
R&D Expenses Depreciation & Amortization, Total Other Operating Expenses
30,811.0
850.2 6,880.9 17,508.5
35,136.3
659.5 7,820.7 24,046.6
OPERATING INCOME
OTHER OPERATING EXPENSES, TOTAL Interest Expense Interest and Investment Income
34,339.6
56,050.6 -4,650.6 592.5
35,851.4
67,663.1 -9,127.2 1,696.6
Liquidity ratio
Current ratio = Current assets / Current liability
2008
?
2007 162,779.2 127,633.7
Current Assets Current Liability Current Ratio (2008) Current Ratio (2007) Quick Ratio (2008) Quick Ratio (2007)
192,673.5 188,948.8 192,673.5/ 188,948.8 = 1.01 162,779.2/ 127,633.7 = 1.27
?
?
?
?
C.A. - Invent. / C.L. 192,673.5 - 32,946.4 / 188,948.8 = .85 162,779.2- 31,669.0/127,633.7 = 1.02
?
Cont…
?
Interval measure = Current assets-inven. / avg. daily cash oper. Exp For 2008 : Avg. daily cash oper. Exp.Interval measure Total cash exp./ 365 67,663.1/ 365 = 185.3 192,673.5 - 32,946.4 / 185.3 = 862 days 56,050.6/ 365 = 153.5 162,779.2- 31,669.0 / 153.5 = 854 days
?
?
? ?
For 2007 : Avg. daily cash oper. Exp Interval measure -
In liquidity ratio, we observe that current ratio in 2008 is less in comparison of 2007. it means companies efficiency decreases in paying current liability. And in quick ratio, it also decreases. In 2008, regular cash meet was 862 days in comparison of 854 of 2007. It means firms ability to pay its daily exp. Increases.
Leverage Ratio
?
Total debt ratio For 2008 Total debt Capital employed Or For 2007 Total debt Capital employed
:
Total debt / capital employed
?
? ?
: :
63,345.5 Net worth + borrowing Share capital + debt. 86,975.2+ 63,345.5= 150320.7 63,345.5 / 150320.7 = .42 38,693.6 77,216.7 + 38,693.6= 115910.3 (shr. cap) (debt) 38,693.6 / 115910.3 = .33
? ? ?
: :
Cont…
?
Debt equity ratio For 2008 For 2007 Capital equity ratio -
-
? ?
Net worth / total debt Net worth = share cap. 86,975.2/63,345.5 = 1.37 77,216.7 /38,693.6 = 1.99 Capital employed / net worth
?
? ?
For 2008 For 2007
150320.7 / 86,975.2= 1.73 115910.3 / 77,216.7 = 1.50
Interest coverage ratio – EBIT + depreciation / Intere
? ? ?
Earning before tax Add- Interest Total
2008 30,448.3 9,127.2 39575.5
2007 31,326.4 4,650.6 35977
Cont….
?
For 2008 : For 2007 :
39575.5 + 7,820.7/9,127.2 = 5.19 35977 + 6,880.9 / 4,650.6= 9.21
?
? ? ? ? ?
In 2008, the long term financial position getting strong than 2008. Capability of paying long term debt. is increases. As we seen, debt ratio increases. And the contribution of debt is increases in 2008 than 2007. and the part of share capital is Also increases in total capital employed than 2007. it means, company is increasing Its capital through shares.
Activity Ratio
Inventory Turnover Ratio = Cost of goods sold / Inventory (2008)
? ?
(2007) 234,753.6 31,669.0 = = 7.72 7.41
Cost of goods sold : Inventory : For 2008 For 2007 : :
254,571.5 32,946.4
?
254,571.5 / 32,946.4 234,753.6 / 31,669.0
?
Cont…
Debtor Turnover Ratio =
?
Sales / debtor 358,086.0 (sales) / 97,555.9 (debtor) 325,143.8 (sales) / 101,638.5 (debtor) (2008) = 360 / 3.67 = 98 days (2007) = 360 / 3.20 = 112 days Sales / Net assets or capital employed 358,086.0 (sales) / 150320.7 (c.e.) 325,143.8 (sales) / 115910.3 (c.e.) = 2.38 = 2.80 = 3.67 = 3.20
For 2008 : For 2007 : Average collection period Average collection period Assets Turnover Ratio : For 2008 : For 2007 :
?
?
?
?
?
?
Cont…
Working Capital Turnover Ratio =
?
Sales / Net working capital Current assets – Current liability 192,673.5 - 188,948.8 = 3724.7 162,779.2 - 127,633.7 = 35145.5
Net Working Capital For 2008 : For 2007 : For 2008 : For 2007 :
= = =
? ?
?
358,086.0 (sales) / 3724.7 (N.W.C.) =
96.13
?
325,143.8 (sales) / 35145.5 (N.W.C) = 09.25
As we seen, company’s efficiency of using its assets is increasing in 2008 than 2007. The inventory turnover ratio which shows its efficiency of selling product is increasing. Average collection period is decreasing means company is selling its product more on cash basis in 2008 than 2007. but company’s assets turnover ratio is decreasing means sales is not growing according to its capital employed and working capital.
Profitability Ratio
? ? ? ? ? ?
?
? ?
Gross Margin = Gross Margin (2008) = Gross Margin (2007) = EBIT Ratio = For 2008 = For 2007 = Return on investment= For 2008 = For 2007 =
Gross profit / Sales 103,514.5 / 358,086.0 = 90,390.2 / 325,143.8 = PAT / EBIT 21,677.0 / 37878.9 = 21,699.9 / 35384.5 = EBIT / Capital employed 39575.5 / 150320.7 = 35977 / 115910.3 =
.29 .28
.57 .61 .26 .31
Cont….
?
Return on equity For 2008 For 2007
= = =
PAT / Net worth 21,677.0 / 86,975.2 = 21,699.9 / 77,216.7 = .25 .28
? ?
In profitability ratio, the gross profit ratio is increasing in 2008 than 2007. it means its profit is growing in sales. But company’s EBIT ratio is decreasing means interest on capital and tax rate is increased in 2008 than 2007 which is responsible in decreasing its PAT. And company’s return on investment is decreased that indicates that its earning on capital employed is decreased in 2008 than 2007. and its ROE is also decreases means its PAT on its share capital is decreased.
THANK YOU
ANY QUESTION ???????????
doc_440408979.ppt