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APROJECT REPORT ON

RATIO ANALYSISUNDERTAKEN AT

SAI JYOTI DYEING AND PRINTING MILL PVT. LTD.

Submitted By:TUSHAR B. KALATHIYA

( 097040592032 )

Guided By:MR. AMIT SHAHAsst. Professor

MBA PROGRAMME

(Year 2009-11)BHAGWAN MAHAVIR COLLEGE OF MANAGEMENT

SURAT

INTRODUCTIONINTRODUCTIONAbout the topic:o Ratio analysis is one of the technique of financial analysis to

evaluate financial condition and performance of business. Simply, ratio means the comparison of one figure to other relevant figure or figures.

o Ratios are calculated from current year numbers and are then compared to previous years, other companies, the industry, or even the economy to judge the performance of the company.

About the Organization:o Sai Jyoti Dyeing and printing mill Pvt. Ltd. is belonging to textile

industry. It is well known company in Surat and they are doing their business in all over India.

o They are using seymore print Pvt. Ltd. As marketing company.o It is expanded in the year of 2002 With New Subsidiary

Company Sai-Jyoti Fashion handprint & Prism Print.

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LITERATURE REVIEWLITERATURE REVIEWName of authorJames M. Patton

Year of study1982

Result of studyo Analysis of business transaction in market that may not be

efficient.o Performance evaluation and risk in an efficient market can be

measured by ratio analysis.o Analysts use ratios to predict financial variables and to

evaluate relative performance.

How the results are help me for studyo Result of above studies are help me to analyze financial

statement and find out variables.

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CONTRIBUTION AND LEARNINGCONTRIBUTION AND LEARNINGTo the organization: Company can measuring the profitability They can judge the operational efficiency of business They can assess the solvency of the business They can measuring short and long term financial position of

the company

To the researcher: By this project I can got lots of practical knowledge about Ratio

Analysis. How to get data for it, how to calculate ratio base on that data, what are the problems face in it and how you can learn from that.

By this project I can learn about human behavior in the organization in practically.

I can get analytical skill and communication skill from this project work.

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RESEARCH METHODOLOGYRESEARCH METHODOLOGY Objectives Primary Objective

To increase efficiency of organization within use of various types of financial ratios.

Secondary Objectiveo To know the financial condition of the company o To know liquidity position of companyo To know profitability of companyo To know market position of company

Problem Statmento How to know financial efficiency of the organization? And how

to increase it?

Research Design Analytical research design

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Sample Sizeo Balance sheets and profit & loss Account of The Sai Jyoti

dyeing and printing mill Pvt. Ltd. ( of years 2006, 2007, 2008, 2009 ).

Data Collection Methodo Secondary data collection method Data are collected from balance sheet, profit & loss account,

auditor’s report, Director’s report of Sai Jyoti dyeing & printing mills Pvt. Ltd.

Limitation Of Studyo It takes more time and consuming money.o Lack of availability of common standards.o Balance sheet is base on last date and I analysis data on the

base on balance sheet so it give me result of one date which is not sufficient.

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DATA ANALYSIS DATA ANALYSIS o Net profit margin ratio of company is 7.64% in 2009. And it is

increasing by 101.58% in 2009 then 2008.it indicate very good growth of company. [1]

o Company's gross profit margin is 16.11% in 2009 and 18.09% in 2008. so company’s gross profit margin ratio is declining by 15% in 2009 than 2008.

o Asset turnover ratio is1.61 time in 2009. And it is increasing by 5% in 2009 then 2008.

o Debt service cover ratio is 22.35% in 2009. And it is increasing by 80.53%in 2009 then 2008.[2]

o Earning per share of company is 13.19 Rs. in 2009 but it was only 5.94 Rs. in 2008. It is increasing by 122% in 2009 then 2008. it indicate good performance of the company.[3]

o Interest cover ratio of the company is 3.75 time in 2009. And it is increasing by 60% in 2009 then 2008.

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FINDINGSFINDINGSo Company's gross profit margin is declining by 15% in 2009

then 2008.o Company’s current ratio is 1:1.25 in 2009. current ratio is

increasing by 15% in 2009 then 2008.o Quick ratio of the company is declining by 15% in 2009 then

2008. Quick ratio is 1:1.05 in 2009.o Debtors conversion period is 5.58 time in 2009. And it is

increasing by 12% in 2009.o Stock turnover ratio is 30.39 time in 2009. And it is declining

by 59% in 2009 then 2008.o Debt ratio of company is 75% of total assets in 2009. And it is

declining by 8.5% in 2009 then 2008.o Debt to equity ratio of company is 1.38 time in 2009. And it is

declining by 63.58% in 2009 then 2007.

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CONCLUSIONCONCLUSIONo Company get good net profit margin in 2009. it become almost

doubled in2009 than 2008.o Liquidity position of the company is good in 2009 but than also

company wants to improve liquidity position. Liquidity ratio of the company should be 1:2.

o Debt ratio of the company is declining every year and it is good for the company.

o Company is not give an single rupee of dividend to its shareholders and all profit invested in business. So company’s profit is continuously increased. But shareholder cannot get any dividend.

o From Ratio Analysis of all four years we can say that 2007 is not as good as other years.[4]

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RECOMMENDATIONSRECOMMENDATIONSo Company's gross profit margin is decline in 2009. So company

wants to control manufacturing cost to increase gross profit.o Current ratio of the company is less in all four years. Company

should increase their current assets or they can decrease current liability.

o Debtor conversion period of company is 5 time in a year. Company should improve it by declining debtors.

o Stock turnover ratio is 30.39 time in a year. Company wants to increase it so they can decrease storage cost of the materials.

o Debt ratio of the company is 75% in 2009. company should decrease it by declining total debt or increasing equity shares of the company.

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BIBLIOGRAPHYBIBLIOGRAPHY Bookso Ambrish Gupta – Financial Accounting for Management(3rd

Edition 2009).o S.K. Bhattacharya, John Dearden – Accounting for Management

(3rd edition 2008)o Paresh shah, Basic Accounting for Management(2008)

Financial Statement of Sai-Jyoti Dyeing & Printing mils Pvt.Ltd (Year 2006, 2007, 2008 and 2009)

@ Websites http://www.investopedia.com/terms/r/ratioanalysis.asp http://en.wikipedia.org/wiki/Financial_ratio

http://www.universalteacher4u.com/cbse/xii/acctheory/ch11/page1.htm

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