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Tata Motors - Ratio Analysis
Tata Motors - Ratio Analysis
Tata Motors - Ratio Analysis
Submitted By
Deepa Chandirrasekar
Profitability Ratios
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 1
1. Return on Investment (ROI)/Return on Capital Employed
[Operating Profit/Capital Employed]
40.00%
35.00%
30.00%
25.00%
20.00% ROI
15.00%
10.00%
5.00%
0.00%
Return On Investments
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 2
31.00%
30.00%
29.00%
28.00%
27.00% ROSF
26.00%
25.00%
24.00%
23.00%
Total Assets
20.00%
15.00%
10.00%
5.00%
0.00%
Year
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 3
ROGC = Net Profit before Tax & Interest x 100
30.00%
20.00%
10.00%
0.00%
Year
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 4
Equity Per Share
60
50
40
30
20
10
0
Year
12
10
8
6
4
2
0
Year
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 5
GPR = Gross Profit x 100
Net Sales
33.00%
32.00%
31.00%
30.00%
29.00%
28.00%
Year
Net Sales
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 6
Net Profit Ratio
14.00%
13.50%
13.00%
12.50%
12.00%
Year
Net Sales
90.00%
89.00%
88.00%
87.00%
86.00%
Year
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 7
POR = Dividend Per Equity Share x 100
40.00%
30.00%
20.00%
10.00%
0.00%
Year
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 8
Retained Earning Per Share
75.00%
70.00%
65.00%
60.00%
55.00%
Year
DYR 3.75% - - -
Market Price - Not Available for the year 2007 2006 2005
4.00%
3.00%
2.00%
1.00%
0.00%
Year
Coverage Ratios
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 9
1. Fixed Charge Cover Ratio
Interest Charges
10
8
6
4
2
0
Year
1- Tax Rate
DSCR
Principal Amount is not available.
TurnOver Ratios
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 10
FATR = Net Sales Times
8
6
4
2
0
Year
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 11
Working Capital Turnover Ratio
50
0
-50
-100
-150
Year
50
40
30
20
10
0
Year
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 12
DCPR = 12 or 365
0.5
0.4
0.3
0.2
0.1
0
Year
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 13
CreditorsTurnover Ratio
6
5
4
3
2
1
0
Year
2
1.5
1
0.5
0
Year
Average Inventory
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 14
Year 2008 2007 2006 2005
3.6
3.5
3.4
3.3
3.2
3.1
Year
Financial Ratios
2. Current Ratio
CR = Current Asset CA
Current Liabilities CL
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 15
3. Liquidity Ratio
Current Liabilities
Shareholders funds
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 16
Profit & Loss Statement
Prcessing Charges /
Service Income 0 0 0 0 0
Others operational
income 5721 7547.8 5647.1 2651.5 2847.8
Less :Inter divisional
transfers 0 0 0 0 0
Less: Sales Returns 0 0 0 0 0
Less: Excise 43631.1 43494.5 34019.2 30634.4 22703
Net Sales 287308.2 274700.3 206022 174191.3 132232.2
EXPENDITURE :
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 17
Purchases Raw Materials 184980.6 180556.3 133677.5 115447 79850.6
Less: Pre-operative
Expenses Capitalised 0 0 0 0 0
Total Expenditure 258404.6 243078.9 180962.9 153151.6 113930.6
Profits on sale of FA 0 0 0 0 0
Profits on sale of
Investments 1518.1 354.8 1776.4 312 39.8
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 18
Exceptional Income /
Expenses 0 0 56.5 -138.5 -528.6
Profit Before Tax 25764.7 25731.8 20533.8 16519 12923.4
Provision for Tax 5475.5 6597.2 5245 4149.5 4820
Preference Dividend 0 0 0 0 0
Profit & Loss Balance C/F 13830.7 10138.3 7767.6 5856 3658
Equity Dividend % 150 150 130 125 80
Earnings Per Share 52.63 49.65 39.94 34.19 22.96
Book Value 202.54 177.33 143.58 113.15 101.08
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 19
Ratios Analysis
Sr.No: Profitability Ratios 2008 2007 2006 2005
Return on Investment
(ROI)/Return on Capital (Operating Profit)/(Share
Employed [Operating Capital+Reserves &
1 Profit/Capital Employed] Surplus+Long Term Loans) 25.88% 32.43% 33.78% 35.32%
(Net Profit after Income
Tax)/(Share Capital + Total
2 Return on Shareholders Fund Reserves) 25.88% 27.85% 27.61% 30.09%
(Net Profit after Interest, Tax
& Preference
Return on Equity Shareholders Dividend)/(Equity Capital +
3 Fund Total Reserves) 25.88% 27.85% 27.61% 30.09%
Net Profit after Tax/(Total
4 Return on Total Assets Assets) 14.37% 17.59% 18.04% 18.72%
Return on Gross Capital Net PBIT/(Net Fixed Assets +
5 Employed Current Assets) 21.26% 27.04% 27.63% 28.51%
Net Profit after Tax/(Equity
Capital/Face Value of the
6 Earning per Share (EPS) Share) 52.63 49.65 39.93 34.19
Market Price per Equity
7 Price Earning Ratio Share/Earning Per Share 7.60 8.06 10.02 11.70
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 20
Accounts
Receivables(Debtors)/Monthl
y Credit Sales (Units in
4 Debt Collection Period Ratio Months) 0.41 0.29 0.36 0.48
Total Purchaces/Accounts
Payables = (Rawmaterial
5 Creditors Turnover Ratio Cost/Sundry Creditors) 4.34 4.75 5.03 5.26
Average Accounts
Debt Payment Period Enjoyed Payable/(Average Monthly
Ratio (Average age of Credit Purchase) (Units in
6 Payable) Months) 1.69 1.54 1.42 1.33
Stock Turnover (OR) Inventory Costs of Goods Sold during
7 Turnover Ratio the year/Average Inventory 3.51 3.35 3.28 3.52
Balance Sheet
Balance Sheet
(Rs.in Millions)
Particulars Mar 2008 Mar 2007 Mar 2006 Mar 2005 Mar 2004
SOURCES OF FUNDS
- Share Capital 3855.40 3854.10 3828.70 3617.90 3530.00
Equity - Paid Up 3854.90 3853.60 3828.20 3617.40 3529.50
Adjustments to Equitys 0.00 0.00 0.00 0.00 0.00
Profit & Loss Account Balance 13830.70 10138.30 7767.60 5856.00 3658.00
General Reserves 41164.30 31164.30 21306.20 13536.30 8531.50
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 21
Shareholder's Funds 78395.00 68697.50 55370.70 41113.90 35897.70
- Secured Loans 24619.90 20220.40 8227.60 4898.10 9426.50
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 22
- Inventories 24218.30 25009.50 20122.40 16013.60 11474.40
Raw Materials 7785.70 8725.90 7326.90 6300.60 3497.20
2644.60
Debtors more than Six months 956.80 883.60 698.60 717.40 1379.20
Debtors Others 10696.50 7256.20 6802.10 7916.80 5801.10
Less : Provisions for Doubtful Debts 346.00 318.00 342.90 521.00 1030.40
Cash and Bank 23973.10 8267.60 11194.30 20050.40 7704.90
Other Current Assets 8402.00 7217.90 353.20 309.40 212.60
Loans and Advances 35937.10 56803.70 57785.40 26975.40 11415.20
Total Current Assets 103837.80 105120.50 96613.10 71462.00 36957.00
Bank Overdraft / Short term credit 0.00 0.00 0.00 0.00 0.00
Interest Accrued But Not Due 287.50 254.20 190.80 195.90 160.40
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 23
Provision for Corporate Dividend Tax 812.50 982.50 698.40 634.20 182.10
Miscellaneous Expenses not written off 60.50 100.90 141.20 181.60 221.90
------- Management Accounting ---- Ratio Analysis – TATA Motors Limited ------- 24