Final Ratio Analysis

Page | 1
1.0 Introduction

This chapter starts with a discussion on Origin of the report(1.1). Then it comes, the relevance
and background of the research (1.2) to provide a clear understanding about the research. After
the background an elaboration is given on the objective of the research (1.3). The scope of the
research that sets the boundary of the research are discussed too (1.4). Then after that a brief
discussion is given on the limitation to the research (1.6). Finally there is a summary for this part
(1.6).

1.1. Origin of the Report:
The prime objectives of this report are to fulfill the partial obligation for the course of Corporate
Finance. Since, its compulsory for all the groups of students of 2
nd
batch of Department of
Finance & Banking, Jahangirnagar University to understand the current practice of Corporate
Finance theories to explore real life business situation.
Here we have worked on the analysis of seven different business organizations which are listed
in stock market. This analysis helps us to have better understand about the companies and about
their financial condition which as well as gives us better knowledge about the course Corporate
Finance.

1.2. Background and relevance of the research:
Here we have worked one the seven different top business organization and make a comparative
financial analysis of those business firms as a course work of Corporate Finance. Through the
research we have found a better knowledge of the course and have a better understanding the
condition of those firms.

1.3. Objectives of the research
The primary objective of writing the report is fulfilling the partial requirements of the BBA
program. In this report, Ive attempted to give an overview of financial condition of the seven
different business organizations in general. Some following objectives of the report are as
shown:

Page | 2

To present an overview of the financial condition of seven different business
organizations including Beximco Pharmaceuticals Limited, Square Pharmaceuticals
Limited, Dhaka Bank Limited, National Bank Limited, Islami Bank Bangladesh Limited,
AB Bank Limited, Dutch Bangla Bank Limited which are listed in stock Market
To show financial background of the organizations.
To show present condition of investment.
To gain or achieve the practical Idea of financial System of those organizations
To show a comparative analysis of financial statements
To give a better idea for the potential investors about the condition of those
organizations
To suggest some possible recommendations about those organizations.

1.4. The scope of the research
This report will cover an organizations financial overview of the seven companies including
Beximco Pharmaceuticals Limited, Square Pharmaceuticals Limited, Dhaka Bank Limited,
National Bank Limited, Islami Bank Bangladesh Limited, AB Bank limited, Dutch Bangla Bank
Limited which will give a wide view of different stages of procedure of those organizations, and
the comparison between the financial conditions of those organizations and give better idea for
the potential investors about their investment in those organizations.

1.5. Methodology
To complete this report weve followed a systematic study which include inspecting and talking
to the executives at different levels of the organization and a have better idea through their
annual statement for last ten years to know the present consequence of the financial condition.
To simplify make the report more meaningful and presentable two sources of data and
information have been used widely.
The primary sources which are as follows-
Unceremonious discussion with the client.
Relevant file study as delivered by the officers concerned.
Face to face conversation with the financial executives and the officers of this
organization

The Secondary Sources of data and information are as follows-
Annual Statements For the last ten years.
Various books, articles, compilations etc, regarding general banking functions.
Websites.
Periodicals published by Bangladesh Bank.
Page | 3

1.6. Limitation
The report is accompanied with the following limitations-
Access to data regarding different performance indicators of Beximco Pharmaceuticals
Limited, Square Pharmaceuticals Limited, Dhaka Bank Limited, National Bank Limited,
Islami Bank Bangladesh Limited, AB Bank Limited, Dutch Bangla Bank Limited.
The report is mainly based on the secondary data which published by different
organization as annually, half-yearly, monthly, weekly and daily.
Time constraints are additional limitations of this report.
Due to some permissible obligation and business secrecy organizations are reluctant to
provide data. For this reason, the study limits only on the accessible published data and
convinced degree of informal consultation.
The financiers are very busy with their businesses which lead a slight time to access with.
Finally, some recent data which were needed to addition this report but the indisposition
of the executives of the organization due to confidentiality was made my report limited to
data content.

Page | 4

2.0 Performance Analysis
2.1 Financial Performance Analysis:
Mainly performance analysis means to identify the financial soundness of the business
organizations that means to evaluate the performance and conditions of that firm over time. to
analyze the performance of the business organizations we need the financial data over the time.
Thats why we need to make a proper analysis on the financial data of particular company.
Thats why we need to do financial statement analysis.
2.2 Financial statement analysis:
If we want to make the financial statements analysis we need to know about the financial
statements and financial statement analysis. So lets have a brief idea about financial statement
and financial statement analysis.

Financial statements are the statements that show the operating conditions and financial positions
of a firms business at a certain point of time. Mainly the financial statements are the
Balance Sheet
Income Statement
Statement of Retained Earnings
Financial statement analysis is the analysis of the firms financial statements for measuring or
evaluating the profitability and financial conditions of firms business over and or at a point in
time.
Financial statement analysis mainly involves
Comparing the firms performance with that of other firms
Evaluating trends in the firms financial positions over time

Here we have shown the financial statement analysis of seven different business organizations
and these studies help the potential investors, stockholders, managers, suppliers, Lending
institutions, and employees etc. to understand the trend and movement of the financial data over
the time and evaluate their decision about that particular companies. This helps them to identify
deficiencies and take actions to improve performance.
In order to make a better analysis and evaluation of financial condition over the years we mainly
work with ratio analysis.
Page | 5

2.3 Ratio Analysis:
Financial statements report both on a firms position at point in time and its operations over past
period. However the real value of financial statements lies in the fact that they can be used to
predict the future earnings and conditions.
Financial ratios are the yardstick that measures the relationship between two accounting figures
in numerical manner. It expresses the result based on comparison or times per period. They are
used to help to evaluate the financial statements.
Ratios can be classified under following types
Liquidity Ratios
Profitability Ratios
Asset Management Ratios
Debt Management Ratios
Investors Ratios

Now lets have a look in brief on the business organizations that we are assigned to do and the
change in the years in financial ratios in those companies in course of time

Page | 6

3.0 Company Analysis

4.0 Beximco Pharmaceuticals Limited:
Beximco Pharmaceuticals Ltd (BPL) is a leading manufacturer of pharmaceutical formulations
and Active Pharmaceutical Ingredients (APIs) in Bangladesh. The company is one of the largest
exporter of pharmaceuticals in the country and its state-of-the-art manufacturing facilities are
certified by global regulatory bodies of Australia, European Union, Gulf nations, Brazil, among
others. The company is consistently building upon its portfolio and currently producing more
than 500 products in different dosage forms covering broader therapeutic categories which
include antibiotics, antihypertensives, antidiabetics, antiretrovirals, anti asthma inhalers etc,
among many others.

With decades of contract manufacturing experience with global MNCs, skilled manpower and
proven formulation capabilities, the company has been building a visible and growing presence
across the continents offering high quality generics at the most affordable cost.

Ensuring access to quality medicines is the powerful aspiration that motivates more than 2,700
employees of the organization, and each of them is guided by the same moral and social
responsibilities the company values most
4.1 Mission
We are committed to enhancing human health and well being by providing contemporary and
affordable medicines, manufactured in full compliance with global quality standards. We
continually strive to improve our core capabilities to address the unmet medical needs of the
patients and to deliver outstanding results for our shareholders.

Now, lets have a look on the ratio analysis of Beximco Pharma Ltd.

Page | 7

4.2.0 Analysis of Beximco Pharmaceuticals Limited
4.2.1 Working Capital:

Here we see that there is an increasing trend in 2002 to 2007 but it falls in the year of 2008 and it
grows very high suddenly in the year of 2009 and it continues its trend till 2011.

0
1E+09
2E+09
3E+09
4E+09
5E+09
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Working capital
Working capital
FY Current Assets Current Liabilities Working capital
2002 FY 1982226375 1509003009 473223366
2003 FY 2072764870 1229860988 842903882
2004 FY 2471513225 1659260602 812252623
2005 FY 3495849163 2501824658 994024505
2006 FY 3357393266 2527420798 829972468
2007 FY 2923775458 1627972936 1295802522
2008 FY 2861891654 2602032267 259859387
2009 FY 6916737893 2321451642 4595286251
2010 FY 6191667831 2513157232 3678510599
2011 FY 7148462753 2648161988 4500300765
Page | 8

4.2.2Current Ratio:

Here current ratios were around 1.00 but it suddenly grows in 2009 to 2.9 and then it continues
its trend around 2.5 till 2011.

0
0.5
1
1.5
2
2.5
3
3.5
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Current Ratio
Current Ratio
FY Current Assets Current Liabilities Current Ratio
2002 FY 1982226375 1509003009 1.313600015
2003 FY 2072764870 1229860988 1.685365167
2004 FY 2471513225 1659260602 1.489526854
2005 FY 3495849163 2501824658 1.397319813
2006 FY 3357393266 2527420798 1.328387132
2007 FY 2923775458 1627972936 1.795960727
2008 FY 2861891654 2602032267 1.099867857
2009 FY 6916737893 2321451642 2.979488251
2010 FY 6191667831 2513157232 2.463700938
2011 FY 7148462753 2648161988 2.699405393
Page | 9

4.2.3 Acid Test Ratio:

There is a great harmonious relation between current ratio and acid test ratio, so the trends
between the years are more or less quite similar to current ratio and quick ratio or acid test ratio.

0
0.5
1
1.5
2
2.5
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Acid test ratio
Acid test ratio
Column1
Current
Assets
Current
Liabilities Inventories Acid test ratio
2002 FY 1982226375 1509003009 1113539289 0.575669552
2003 FY 2072764870 1229860988 1143710812 0.755413878
2004 FY 2471513225 1659260602 1394794907 0.648914533
2005 FY 3495849163 2501824658 1683722059 0.724322185
2006 FY 3357393266 2527420798 1754440288 0.634224811
2007 FY 2923775458 1627972936 1470152242 0.892903797
2008 FY 2861891654 2602032267 1505288093 0.521363082
2009 FY 6916737893 2321451642 1722953284 2.237300366
2010 FY 6191667831 2513157232 1983809444 1.674331527
2011 FY 7148462753 2648161988 2291844631

1.833958098
Page | 10

4.2.4 Cash Ratio:

Here we can see that there is a sudden growth of cash in the year of 2009 and 2010. Then the
cash volume continues its trend.

0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY
Cash ratio
Cash ratio
FY Cash Current Liabilities Cash ratio
2002 FY 4918273 1509003009 0.003259286
2003 FY 4911867 1229860988 0.003993839
2004 FY 8009302 1659260602 0.004827031
2005 FY 428563230 2501824658 0.171300266
2006 FY 581098945 2527420798 0.229917767
2007 FY 85698910 1627972936 0.052641483
2008 FY 73647728 2602032267 0.028303926
2009 FY 1058433574 2321451642 0.455936085
2010 FY 1471448436 2513157232 0.585497961
2011 FY 518768296 2648161988 0.195897494
Page | 11

4.2.5 Inventory Turnover Ratio:

In 2005 the inventory turnover ratio decreases significantly. Then it is continuously increasing
till 2011.

0
0.5
1
1.5
2
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Inventory turnover ratio
FY Cost of goods sold Inventories Inventory turnover ratio
2002 FY 1620493149 1113539289 1.455263559
2003 FY 1355748848 1143710812 1.185394799
2004 FY 1430590446 1394794907 1.025663658
2005 FY 1768522363 1683722059 1.050364788
2006 FY 1971231333 1754440288 1.123567069
2007 FY 1967509975 1470152242 1.338303557
2008 FY 2002871181 1505288093 1.330556716
2009 FY 2566206626 1722953284 1.489423219
2010 FY 3317640254 1983809444 1.672358333
2011 FY 4103709021 2291844631 1.79057034
Page | 12

4.2.6 Days Sales Outstanding Ratio (DSO):

Column1 Sales Avg sales per day Ac receivables DSO
2002 FY 2522942523 6912171.296 447307967 64.71309055
2003 FY 2183829795 5983095.329 99677576 16.6598676
2004 FY 2402700962 6582742.362 600028183 91.15170396
2005 FY 3327022574 9115130.34 779798943 85.5499498
2006 FY 3702317159 10143334.68 430240095 42.41604053
2007 FY 3597024812 9854862.499 499680792 50.70398416
2008 FY 4010167059 10986759.07 503916401 45.86579154
2009 FY 4868254915 13337684.7 694111730 52.04139592
2010 FY 6490847353 17783143.43 821356439 46.18735951
2011 FY 7890241843 21617100.94 978224317 45.25233609

After the great declining stage in 2003, it increases significantly in 2004, but fails to continue.
Then from 2006 till 2011 it is around 50.

0
20
40
60
80
100
2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY
DSO
DSO
Page | 13

4.2.7 Total Asset Turnover Ratio:

FY Sales Total assets Total asset turnover ratio
2002 FY 2522942523 6762691200 0.37
2003 FY 2183829795 8012857866 0.27
2004 FY 2402700962 8560380432 0.28
2005 FY 3327022574 10945479980 0.30
2006 FY 3702317159 11912512487 0.31
2007 FY 3597024812 11953418940 0.30
2008 FY 4010167059 14819665441 0.27
2009 FY 4868254915 19891933422 0.24
2010 FY 6490847353 21372399509 0.30
2011 FY 7890241843 23033340533 0.34

It measures the turnover of all firms assets. Here we see that in Beximco Pharma the turnover is
quite similar in all the years. And it continues its growth trend from 2009 to 2010.

-
0.05
0.10
0.15
0.20
0.25
0.30
0.35
0.40
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Total asset turnover ratio
Total asset turnover ratio
Page | 14

4.2.8 Capital Intensity Ratio:
FY Total assets Sales Capital intensity
2002 FY 6762691200 2522942523 2.680477711
2003 FY 8012857866 2183829795 3.669176913
2004 FY 8560380432 2402700962 3.562815584
2005 FY 10945479980 3327022574 3.289872472
2006 FY 11912512487 3702317159 3.217582929
2007 FY 11953418940 3597024812 3.32314053
2008 FY 14819665441 4010167059 3.69552321
2009 FY 19891933422 4868254915 4.086050088
2010 FY 21372399509 6490847353 3.292697909
2011 FY 23033340533 7890241843 2.919218573

It measures the strength of capital in a company. In Beximco Pharma from 2002-2010, it was
between 3 to 4. In 2011 it suddenly decreases and comes in the level of two to three.

0
1
2
3
4
5
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Capital intensity
Capital intensity
Page | 15

4.2.9 Total Debt Ratio:
FY Sales Avg sales per day Ac receivables DSO
2002 FY 2522942523 6912171.296 447307967 64.71309055
2003 FY 2183829795 5983095.329 99677576 16.6598676
2004 FY 2402700962 6582742.362 600028183 91.15170396
2005 FY 3327022574 9115130.34 779798943 85.5499498
2006 FY 3702317159 10143334.68 430240095 42.41604053
2007 FY 3597024812 9854862.499 499680792 50.70398416
2008 FY 4010167059 10986759.07 503916401 45.86579154
2009 FY 4868254915 13337684.7 694111730 52.04139592
2010 FY 6490847353 17783143.43 821356439 46.18735951
2011 FY 7890241843 21617100.94 978224317 45.25233609

Here the trend of debt ratio between 30.00 and 45. Actually creditors prefer lower debt ratio and
on the other hand shareholders want higher debt ratio. Without sudden increase in the year 2009
and 2005 it is more or less quite similar in all the years.

- 0.10 0.20 0.30 0.40 0.50
2002 FY
2004 FY
2006 FY
2008 FY
2010 FY
Debt ratio
Debt ratio
Page | 16

4.2.10 Debt to Equity Ratio:
Column1 Total liabilities Total shareholders equity Debt to Equity ratio
2002 FY 2321595008 4441096192 0.522752696
2003 FY 3416436889 4596420977 0.743281981
2004 FY 3725632771 4834747661 0.770595082
2005 FY 4124555018 6820925052 0.604691444
2006 FY 3962592062 7949920425 0.498444242
2007 FY 3702479293 8250939647 0.44873426
2008 FY 4369463296 10450202145 0.418122371
2009 FY 9006226808 10885706614 0.827344253
2010 FY 5398313058 15974086451 0.337941896
2011 FY 5905212356 17128128177 0.344766941

From 2005 to 2008 it was decreasing and unexpectedly it rose up to 0.8 in 2009. After that it was
under 0.4 till 2011.

0
0.2
0.4
0.6
0.8
1
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Debt to Equity ratio
Debt to Equity ratio
Page | 17

4.2.11 Profitability Ratio:
Profit Margin:
FY Retained earnings Sales Profit margin
2002 FY 1510155670 2522942523 0.598569193
2003 FY 1507743468 2183829795 0.690412536
2004 FY 2339880113 2402700962 0.973854071
2005 FY 2693284178 3327022574 0.809517855
2006 FY 3039774569 3702317159 0.821046506
2007 FY 3189176356 3597024812 0.886615056
2008 FY 4005112020 4010167059 0.998739444
2009 FY 4282514032 4868254915 0.879681551
2010 FY 5087312943 6490847353 0.783767152
2011 FY 5889784879 7890241843 0.74646443

The profit margin of Beximco Pharma is almost stable and it is varying about 0.6 to 0.8.

0
0.2
0.4
0.6
0.8
1
1.2
Profit margin
Profit margin
Page | 18

4.2.12 Return on Assets (ROA):
Column1 Retained earnings Total assets Return on total assets
2002 FY 1510155670 6762691200 0.223306909
2003 FY 1507743468 8012857866 0.188165508
2004 FY 2339880113 8560380432 0.273338333
2005 FY 2693284178 10945479980 0.246063597
2006 FY 3039774569 11912512487 0.255174932
2007 FY 3189176356 11953418940 0.26680035
2008 FY 4005112020 14819665441 0.270256575
2009 FY 4282514032 19891933422 0.215288979
2010 FY 5087312943 21372399509 0.238031904
2011 FY 5889784879 23033340533 0.255706934

The trend of ROA of Beximco Pharma fell in 2003 and 2009. Without those year, it was nearly
0.2 to 0.25.

0
0.05
0.1
0.15
0.2
0.25
0.3
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Rrturn on total assets
Rrturn on total assets
Page | 19

4.2.13 Return on Equity (ROE)
FY Retained earnings Total shareholders equity Return on total equity
2002 FY 1510155670 4441096192 0.340041198
2003 FY 1507743468 4596420977 0.328025539
2004 FY 2339880113 4834747661 0.483971507
2005 FY 2693284178 6820925052 0.394856146
2006 FY 3039774569 7949920425 0.382365408
2007 FY 3189176356 8250939647 0.386522807
2008 FY 4005112020 10450202145 0.383256894
2009 FY 4282514032 10885706614 0.393407078
2010 FY 5087312943 15974086451 0.318472857
2011 FY 5889784879 17128128177 0.343866231

We can see that in 2004 the trend of ROE is significantly higher (0.5) than rest of the years,
otherwise it is nearly 0.3 to 0.4.

0 0.1 0.2 0.3 0.4 0.5 0.6
2002 FY
2004 FY
2006 FY
2008 FY
2010 FY
Return on total equity
Return on total equity
Page | 20

4.2.14 Earnings per Share:
FY Earning per share
2002 FY 7.72
2003 FY 3.7
2004 FY 5.26
2005 FY 6.36
2006 FY 4.67
2007 FY 2.8
2008 FY 4.33
2009 FY 4.13
2010 FY 4.18
2011 FY 4.76

We can see great fluctuations in almost every year. In 2007 there is a devastating decrease.

0
2
4
6
8
10
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Earning per share
Earning per share
Page | 21

4.2.15 Price Earnings Ratio:

In 2002, 2005, 2010 and 2011 the Price Earnings Ratio was around 20. It was above 20 rest of
the years.

0
10
20
30
40
50
Price earnings ratio
Column1 NO of shares Total assets Price per share EPS
Price earnings
ratio
2002 FY 44250000 6762691200 152.8291797 7.72 19.79652586
2003 FY 55976250 8012857866 143.1474575 3.7 38.68850202
2004 FY 55976250 8560380432 152.9287945 5.26 29.0739153
2005 FY 76878446 10945479980 142.3738453 6.36 22.38582474
2006 FY 100737415 11912512487 118.2531087 4.67 25.32186482
2007 FY 125957747 11953418940 94.90022825 2.8 33.89293866
2008 FY 125957747 14819665441 117.6558473 4.33 27.1722511
2009 FY 151149296 19891933422 131.604539 4.13 31.86550581
2010 FY 251767810 21372399509 84.88932524 4.18 20.30845102
2011 FY 251767810 23033340533 91.48643956 4.76 19.21984024
Page | 22

4.2.16 Market to Book Ratio:
Column1
Total shareholders
equity
NO of
shares
Book value per
share
Price per
share
Market/Book
ratio
2002 FY 4441096192 44250000 100.3637558 2.26811E-06 2.25989E-08
2003 FY 4596420977 55976250 82.11377105 1.46694E-06 1.78647E-08
2004 FY 4834747661 55976250 86.37141039 1.543E-06 1.78647E-08
2005 FY 6820925052 76878446 88.72350323 1.15408E-06 1.30075E-08
2006 FY 7949920425 100737415 78.91725656 7.83396E-07 9.9268E-09
2007 FY 8250939647 125957747 65.50561473 5.2006E-07 7.93917E-09
2008 FY 10450202145 125957747 82.96593416 6.58681E-07 7.93917E-09
2009 FY 10885706614 151149296 72.01956544 4.7648E-07 6.61598E-09
2010 FY 15974086451 251767810 63.44769195 2.52009E-07 3.97191E-09
2011 FY 17128128177 251767810 68.03144603 2.70215E-07 3.97191E-09

Market/Book ratio trend of Beximco Pharma is decreasing at a decreasing rate.

0
5E-09
1E-08
1.5E-08
2E-08
2.5E-08
Market/Book ratio
Market/Book ratio
Page | 23

5.0 Square Pharmaceuticals Limited:
SQUARE today symbolizes a name a state of mind. But its journey to the growth and
prosperity has been no bed of roses. From the inception in 1958, it has today burgeoned into one
of the top line conglomerates in Bangladesh. Square Pharmaceuticals Ltd., the flagship company,
is holding the strong leadership position in the pharmaceutical industry of Bangladesh since 1985
and is now on its way to becoming a high performance global player.
SQUARE Pharmaceuticals Limited is the largest pharmaceutical company in Bangladesh and it
has been continuously in the 1st position among all national and multinational companies since
1985. It was established in 1958 and converted into a public limited company in 1991. The sales
turnover of SPL was more than Taka 11.46 Billion (US$ 163.71 million) with about 16.43%
market share (April 2009 March 2010) having a growth rate of about 16.72%.
5.1Mission
Mission is to produce and provide quality & innovative healthcare relief for people, maintain
stringently ethical standard in business operation also ensuring benefit to the shareholders,
stakeholders and the society at large.
5.2 Vision
We view business as a means to the material and social wellbeing of the investors, employees
and the society at large, leading to accretion of wealth through financial and moral gains as a part
of the process of the human civilization.

Now lets have look in the changes of ratios analysis of Square Pharmaceuticals Limited.

Page | 24

5.3 Ratio Analysis:
5.3.1 Working Capital:
Column1 Current asset Current liabilities Working capital
2003 FY 1441552330 1247966832 193585498
2004 FY 2016056187 1250675506 765380681
2005 FY 3242502312 1949949426 1292552886
2006 FY 4477330627 2924483270 1552847357
2007 FY 4465404559 3466720868 998683691
2008 FY 5506143431 4532583510 973559921
2009 FY 4130759561 2978735582 1152023979
2010 FY 4553041968 2216744401 2336297567
2011 FY 7022213840 4668189426 2354024414

Here we can see an increasing trend in 2003 to 2006 but it falls in the year of 2007 and continues
its trend. In 2009 it again grows up and continues till 2011.

0
500000000
1E+09
1.5E+09
2E+09
2.5E+09
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Working capital
Working capital
Page | 25

5.3.2Current Ratio:
Column1 Current asset Current liabilities Current Ratio
2003 FY 1441552330 1247966832 1.16
2004 FY 2016056187 1250675506 1.61
2005 FY 3242502312 1949949426 1.66
2006 FY 4477330627 2924483270 1.53
2007 FY 4465404559 3466720868 1.29
2008 FY 5506143431 4532583510 1.21
2009 FY 4130759561 2978735582 1.39
2010 FY 4553041968 2216744401 2.05
2011 FY 7022213840 4668189426 1.50

Here current ratios were around 1.5 but in 2010 it increased to 2.1. In 2011 it again came down
to 1.5.

-
0.50
1.00
1.50
2.00
2.50
2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY
Current Ratio
Current Ratio
Page | 26

5.3.3 Acid Test Ratio
Column1 Current asset Cnt liabilities Inventories CU- inv. Acid test ratio
2003 FY 1441552330 1247966832 739835432 701716898

0.56
2004 FY 2016056187 1250675506 795856209 1220199978

0.98
2005 FY 3242502312 1949949426 1144912356 2097589956

1.08
2006 FY 4477330627 2924483270 1638743097 2838587530

0.97
2007 FY 4465404559 3466720868 2105938009 2359466550

0.68
2008 FY 5506143431 4532583510 2629557270 2876586161

0.63
2009 FY 4130759561 2978735582 2405531069 1725228492

0.58
2010 FY 4553041968 2216744401 2207078082 2345963886

1.06
2011 FY 7022213840 4668189426 2541688329 4480525511

0.96

In 2003, it started growing up till 2005 and then came down proportionately. From 2007 to 2009,
it continued its trend and suddenly grew up to around 1.00 till 2011.

-
0.20
0.40
0.60
0.80
1.00
1.20
Acid test ratio
Acid test ratio
Page | 27

5.3.4 Cash Ratio:
Column1 Cash Current liabilities Cash ratio
2003 FY 30137159 1247966832 0.02
2004 FY 52080205 1250675506 0.04
2005 FY 382074333 1949949426 0.20
2006 FY 354255023 2924483270 0.12
2007 FY 157323624 3466720868 0.05
2008 FY 225973543 4532583510 0.05
2009 FY 314388576 2978735582 0.11
2010 FY 258727695 2216744401 0.12
2011 FY 370301755 4668189426 0.08

In 2003, it started increasing and in 2005 it suddenly increased to 0.19. Then it keeps its
decreasing rate till 2008 and again grows up in 2009 and falls in 2011.

5.3.5 Total Asset Turnover Ratio:

FY Total assets Sales Total asset turnover
2003 FY 3916353393 4065850882 1.04
2004 FY 4626686161 4721551742 1.02
2005 FY 5957983236 5332046635 0.89
2006 FY 10944432252 7256044684 0.66
2007 FY 12539030507 8747727626 0.70
2008 FY 15058188280 10553760848 0.70
2009 FY 14904565646 11826218788 0.79
2010 FY 15196452304 11462578410 0.75
2011 FY 19444409654 13471424469 0.69
-
0.05
0.10
0.15
0.20
0.25
Cash ratio
Cash ratio
Page | 28

Here total asset turnover is 1.0 in 2003 and 2004. Then it started decreasing and kept its trend to
around 0.70 from 2006 to 2008. In 2009 it increases slightly and then again continues its trend of
0.70 till 2011.

5.3.6 Inventory Turnover Ratio:
FY Sales Inventories Inventory turnover ratio
2003 FY 4065850882 739835432 5.495615249
2004 FY 4721551742 795856209 5.932669355
2005 FY 5332046635 1144912356 4.657165771
2006 FY 7256044684 1638743097 4.427810983
2007 FY 8747727626 2105938009 4.153839091
2008 FY 10553760848 2629557270 4.013512453
2009 FY 11826218788 2405531069 4.916261087
2010 FY 11462578410 2207078082 5.193553642
2011 FY 13471424469 2541688329 5.300187405

-
0.50
1.00
1.50
2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY
Total asset turnover
0
2
4
6
8
Page | 29

It increases in 2003 to 2004 and then falls and keeps its trend around 4 from 2005 to 2008. After
that it grows up in 2009 and continues till 2011 with the trend of around 5.
5.3.7 Capital Intensity Ratio:

FY Total assets Sales Capital intensity
2003 FY 3916353393 4065850882 0.96
2004 FY 4626686161 4721551742 0.98
2005 FY 5957983236 5332046635 1.12
2006 FY 10944432252 7256044684 1.51
2007 FY 12539030507 8747727626 1.43
2008 FY 15058188280 10553760848 1.43
2009 FY 14904565646 11826218788 1.26
2010 FY 15196452304 11462578410 1.33
2011 FY 19444409654 13471424469 1.44

Here we can see that the graph remains stable from 2003 to 2005 and then increases in 2006 and
keeps its trend quite similarly till 2011.

5.3.8 Days Sales Outstanding (DSO):
FY Sales Avg sales per day Ac receivables DSO
2003 FY 4065850882 11139317.48 772421345 69.34189155
2004 FY 4721551742 12935758.2 508249174 39.29025004
2005 FY 5332046635 14608346.95 477562002 32.69103642
2006 FY 7256044684 19879574.48 890994987 44.81962066
2007 FY 8747727626 23966377.06 773713422 32.28328671
2008 FY 10553760848 28914413.28 692961015 23.96593727
2009 FY 11826218788 32400599.42 267527741 8.256876286
-
1.00
2.00
Capital intensity
Capital intensity
Page | 30

2010 FY 11462578410 31404324.41 225115010 7.168280618
2011 FY 13471424469 36908012.24 140536470 3.807749631

Here we can see a decreasing rate from 2003 to 2005. In 2006 it increased slightly and again
started decreasing till 2011.

5.3.9 Total Debt Ratio:

FY Total assets Total equity Total asset-Total
equity
Total debt ratio
2003 FY 3916353393 3851098460 65254933 0.02
2004 FY 4626686161 4590142003 36544158 0.01
2005 FY 5957983236 5568790156 389193080 0.07
2006 FY 10944432252 7193808239 3750624013 0.34
2007 FY 12539030507 8279390777 4259639730 0.34
2008 FY 15058188280 9506932637 5551255643 0.37
2009 FY 14904565646 10925978216 3978587430 0.27
2010 FY 15196452304 11721331851 3475120453 0.23
0
20
40
60
80
DSO
DSO
Page | 31

2011 FY 19444409654 13817708990 5626700664 0.29

In 2003 and 2004 the graph remains quite stable. In 2005, it increases and in 2006, it increases
more highly and continues the trend till 2008. After that it started decreasing till 2010 and again
increased in 2011.

FY Total equity Total debt Debt to equity ratio
2003 FY 3851098460 65254933 0.02
2004 FY 4590142003 36544158 0.01
2005 FY 5568790156 389193080 0.07
2006 FY 7193808239 3750624013 0.52
2007 FY 8279390777 4259639730 0.51
2008 FY 9506932637 5551255643 0.58
2009 FY 10925978216 3978587430 0.36
2010 FY 11721331851 3475120453 0.30
2011 FY 13817708990 5626700664 0.41

-
0.10
0.20
0.30
0.40
Total debt ratio
Total debt ratio
-
0.20
0.40
0.60
0.80
Debt to equity ratio
Page | 32

In 2006, the graph suddenly increases and remains quite similar till 2008. In 2009, it decreases
and grows up again in 2011.

5.3.11 Profit Margin:
FY Sales Retained earnings Profit margin
2003 FY 4065850882 1417302130 0.35
2004 FY 4721551742 1235067597 0.26
2005 FY 5332046635 2075810668 0.39
2006 FY 7256044684 3284218806 0.45
2007 FY 8747727626 4116184797 0.47
2008 FY 10553760848 5045646657 0.48
2009 FY 11826218788 6329384284 0.54
2010 FY 11462578410 6802071388 0.59
2011 FY 13471424469 8353256438 0.62

Profit margin decreases in 2004 and then continues its increasing rate till 2011

FY Retained earnings Total assets ROA
2003 FY 1417302130 3916353393 0.36
2004 FY 1235067597 4626686161 0.27
2005 FY 2075810668 5957983236 0.35
2006 FY 3284218806 10944432252 0.30
2007 FY 4116184797 12539030507 0.33
2008 FY 5045646657 15058188280 0.34
2009 FY 6329384284 14904565646 0.42
2010 FY 6802071388 15196452304 0.45
2011 FY 8353256438 19444409654 0.43

-
0.20
0.40
0.60
0.80
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Profit margin
Profit margin
Page | 33

Here the trends among the years are more or less quite similar and it slightly increases in 2009
and continues the trend.

5.3.13 Return on Equity (ROE):
FY Retained earnings Total equity ROE
2003 FY 1417302130 3851098460 0.37
2004 FY 1235067597 4590142003 0.27
2005 FY 2075810668 5568790156 0.37
2006 FY 3284218806 7193808239 0.46
2007 FY 4116184797 8279390777 0.50
2008 FY 5045646657 9506932637 0.53
2009 FY 6329384284 10925978216 0.58
2010 FY 6802071388 11721331851 0.58
2011 FY 8353256438 13817708990 0.60

Here ROE falls in 2004 and starts increasing in 2005 and keeps the trend till 2011.

-
0.10
0.20
0.30
0.40
0.50
ROA
ROA
-
0.20
0.40
0.60
0.80
ROE
ROE
Page | 34

FY Earnings per share
2003 FY 129.07
2004 FY 106.43
2005 FY 170.51
2006 FY 126.37
2007 FY 244.60
2008 FY 227.21
2009 FY 290.71
2010 FY 224.55
2011 FY 212.47

Here the trend is quite similar till 2006. In 2007, it increases and keeps the graph quite stable till
2011 except 2009. In 2009, the earning per share is in the highest amount.

-
100.00
200.00
300.00
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Earnings per share
Earnings per share
Page | 35


The trend is quite similar from 2003 to 2005. In 2006, it suddenly increases then decreases in
2007. In 2009, it starts keeping its increasing rate till 2011.
-
1.00
2.00
3.00
4.00
5.00
P/E ratio
P/E ratio
FY Total assets No of Shares Price per share EPS P/E ratio
2003 FY 3916353393 19617390 199.6368219 129.07 1.55
2004 FY 4626686161 19617390 235.8461631

106.43 2.22
2005 FY 5957983236 19617390 303.709272

170.51

1.78
2006 FY 10944432252 19617390 557.8944116

126.37

4.41
2007 FY 12539030507 19617390 639.1793458

244.60

2.61
2008 FY 15058188280 19617390 767.5938685

227.21

3.38
2009 FY 14904565646 19617390 759.762927

290.71

2.61
2010 FY 15196452304 19617390 774.6419021

224.55

3.45
2011 FY 19444409654 19617390 991.1822956

212.47

4.67
Page | 36

6.0 Dhaka Bank Limited
Dhaka bank limited is a private owned commercial bank in Bangladesh whose main branch is in
Dhaka. The Bank was incorporated as a public limited company under the Companies Act. 1994.
The Bank started its commercial operation on July 05, 1995 with an authorized capital of Tk.
1,000 million and paid up capital of Tk. 100 million. The paid up capital of the Bank stood at Tk
2,659,597,763 as on March 31, 2010. The total equity (capital and reserves) of the Bank as on
March 31, 2010 stood at Tk 6,036,368,754.
The Bank has 62 Branches, 3 SME Service Centers, 6 CMS Units, 2 Offshore Banking Unit
across the country and a wide network of correspondents all over the world. The Bank has plans to
open more Branches in the current fiscal year to expand the network.
The Bank offers the full range of banking and investment services for personal and corporate
customers, backed by the stateofthe-art technology and a team of highly motivated
Professionals.
As an integral part of our commitment to Excellence in Banking, Dhaka Bank now offers the full
range of real-time online banking services through its all Branches, ATMs and Internet Banking
Channels.Dhaka Bank Ltd. is the preferred choice in banking for friendly and personalized
services, cutting edge technology, tailored solutions for business needs, global reach in trade and
commerce and high yield on investments.
6.1 Mission
To be the premier financial institution in the country providing high quality products and services
backed by latest technology and a team of highly motivated personnel to deliver Excellence in
Banking.
6.2 Vision
At Dhaka Bank, we draw our inspiration from the distant stars. Our team is committed to assure a
standard that makes every banking transaction a pleasurable experience. Our endeavour is to offer
you razor sharp sparkle through accuracy, reliability, timely delivery, cutting edge technology,
and tailored solution for business needs, global reach in trade and commerce and high yield on
your investments.

Page | 37

6.3 Ratio Analysis:

6.3.1Current Ratio:

FY Current ratio(times)
2002 FY 1.42
2003 FY 1.54
2004 FY 1.6
2005 FY 1.33
2006 FY 1.19
2007 FY 1.38
2008 FY 1.28
2009 FY 2.1
2010 FY 1.97
2011 FY 2.09

Here we see that there is an increasing trend in 2002 to 2004 but it falls in the year of 2005 &
2006 and it grows very high suddenly in the year of 2009 and it continues its trend till 2011.

0
0.5
1
1.5
2
2.5
Current ratio(times)
Current ratio(times)
Page | 38

6.3.2 Credit/ Deposit Ratio
FY Credit/deposit ratio(%)
2002 FY 75.7
2003 FY 76.47
2004 FY 74.26
2005 FY 82.19
2006 FY 81.94
2007 FY 82.03
2008 FY 87.21
2009 FY 86.85
2010 FY 90.3
2011 FY 89.1

Here the trend of credit/deposit ratio between75.00 and 91. In the year 2008 to 2011 it is increase
significantly.

0 20 40 60 80 100
2002 FY
2003 FY
2004 FY
2005 FY
2006 FY
2007 FY
2008 FY
2009 FY
2010 FY
2011 FY
Credit/deposit ratio(%)
Credit/deposit ratio(%)
Page | 39


FY ROA
2002 FY 1.23
2003 FY 1.29
2004 FY 1.27
2005 FY 1.4
2006 FY 1.21
2007 FY 1.23
2008 FY 1.18
2009 FY 1.29
2010 FY 2
2011 FY 2.22

The trend on the year 2002 to 2009 is mostly similar but in the year 2010 and 2011 it increase at
a significant rate.

0
0.5
1
1.5
2
2.5
ROA
ROA
Page | 40

6.3.4 Return on Equity (ROE):

FY ROE
2002 FY 26.17
2003 FY 22.23
2004 FY 24.03
2005 FY 20.89
2006 FY 22.74
2007 FY 22.53
2008 FY 20.97
2009 FY 19.32
2010 FY 25.52
2011 FY 23.49

Here we see in the year of 2002 the ROE was 26.17, and it fluctuate nearly 20 to 25 in the year
2003 to 2011.

0
5
10
15
20
25
30
ROE
ROE
Page | 41

6.3.5 Cost To Income Ratio:
FY Cost to income ratio
2002 FY 74.68
2003 FY 77.68
2004 FY 71.91
2005 FY 75.44
2006 FY 78.14
2007 FY 36.57
2008 FY 34.82
2009 FY 33.64
2010 FY 30.87
2011 FY 30.62

Here we see the cost income ratio decreasing at the year 2007 to 2011, but in the year 2002 to
2006 it was significantly high around 70 to 80.

0 20 40 60 80 100
2002 FY
2003 FY
2004 FY
2005 FY
2006 FY
2007 FY
2008 FY
2009 FY
2010 FY
2011 FY
Cost to income ratio
Cost to income ratio
Page | 42

FY Earnings Per share
2002 FY 70
2003 FY 53
2004 FY 61
2005 FY 44
2006 FY 45
2007 FY 46.06
2008 FY 39.42
2009 FY 36.07
2010 FY 4.68
2011 FY 6.03

Here we see the trend of earning per share is gradually decreasing and at the year 2010 & 2011 it
falls a significant rate.
FY Price earnings ratio
2002 FY 3.78
2003 FY 4.75
2004 FY 14.03
2005 FY 10.66
2006 FY 10.32
2007 FY 15.33
2008 FY 9.15
2009 FY 10.72
2010 FY 12.09
2011 FY 7.46

0
20
40
60
80
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Earning Per share
Earning Per share
Page | 43

Here we can see the price earnings ratio is gradually increasing at the year 2002 to 2004, but in
the year 2005 & 2006 it falls down, again it increase in the year 2007 and the trend become end
by falling down at the year 2011
6.3.8 Market to Book Value Ratio:
FY Market value per share Book value per share Market to Book Ratio
2002 FY 264 236 1.118644068
2003 FY 251 228 1.100877193
2004 FY 850 224 3.794642857
2005 FY 469 180 2.605555556
2006 FY 466 198 2.353535354
2007 FY 706 202 3.495049505
2008 FY 361 207 1.743961353
2009 FY 484 233 2.077253219
2010 FY 76 25 3.04
2011 FY 45 26 1.730769231

Here we see in the year 2004 the market to book value ratio increasing at a significant rate and it
fall down in the year 2005 to 2006 and it again increase significantly in the year 2007 and 2010
0
5
10
15
20
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Price earning ratio
0
1
2
3
4
2002
FY
2003
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Market to Book Ratio
Market to Book Ratio
Page | 44

6.3.9 Price Equity Ratio:

FY Price equity ratio(times)
2002 FY 1.12
2003 FY 1.1
2004 FY 3.79
2005 FY 2.6
2006 FY 2.35
2007 FY 3.49
2008 FY 1.74
2009 FY 2.07
2010 FY 3.08
2011 FY 1.75

Here we can see that, in the year 2004, 2007 & 2010 the price equity ratio increase at a
significant rate, without those year the trend moves around the average rate

0 0.5 1 1.5 2 2.5 3 3.5 4
2002 FY
2003 FY
2004 FY
2005 FY
2006 FY
2007 FY
2008 FY
2009 FY
2010 FY
2011 FY
Price equity ratio(times)
Price equity ratio(times)
Page | 45

6.3.10 Total Capital Ratio:
FY Total capital ratio
2002 FY 8.75
2003 FY 10.88
2004 FY 10.51
2005 FY 11
2006 FY 9.43
2007 FY 10.36
2008 FY 11.84
2009 FY 11.31
2010 FY 10.09
2011 FY 10.7

Here we can see that, the trend of total capital ratio moves around the value 10 to 12. But in the
year 2008 & 2009 it increases at a significant rate.

0 2 4 6 8 10 12 14
2002 FY
2004 FY
2006 FY
2008 FY
2010 FY
Total capital ratio
Total capital ratio
Page | 46

7.0 Islami Bank Bangladesh Limited

Islami Bank Bangladesh Limited is a Joint Venture Public Limited Company engaged in
commercial banking business based on Islamic Shari'ah with 63.09% foreign shareholding
having largest branch network (246 Branches & 30 SME/Krishi Branches i.e. total 276
Branches) among the private sector Banks in Bangladesh. It was established on the 13th March
1983 as the first Islamic Bank in the South East Asia.
It is listed with Dhaka Stock Exchange Ltd. and Chittagong Stock Exchange Ltd. Authorized
Capital of the Bank is Tk. 20,000.00 Million ($244.87 Million) and Paid-up Capital is Tk.
10,007.71 Million ($122.53 Million) having 60,550 shareholders as on 31st December 2011.
7.1 Mission
To establish Islamic Banking through the introduction of a welfare oriented banking system and
also ensure equity and justice in the field of all economic activities, achieve balanced growth and
equitable development in through diversified investment operations particularly in the priority
sectors and less developed areas of the country. To encourage socio-economic upliftment and
financial services to the loss-income community particularly in the rural areas.
7.2 Vision
Our vision is to always strive to achieve superior financial performance, be considered a leading
Islamic Bank by reputation and performance.
Our goal is to establish and maintain the modern banking techniques, to ensure soundness and
development of the financial system based on Islamic principles and to become the strong and
efficient organization with highly motivated professional, working for the benefit of people,
based upon accountability, transparency and integrity in order to ensure stability of financial
systems.
We will try to encourage savings in the form of direct investment.
We will also try to encourage investment particularly in projects which are more likely to lead
to higher employment.

Now, lets have a look on the ratio analysis of Islami Bank Bangladesh Limited.
Page | 47

Islami Bank Bangladesh Limited
7.3 Ratio Analysis:
7.3.1 Current Ratio:

FY Current ratio
2005 FY 0.99
2006 FY 1.07
2007 FY 1.14
2008 FY 1.09
2009 FY 1.12
2010 FY 1.09
2011 FY 1.1

Here we can see that, in the year 2005 to 2007 the trend is increasing at a
increasing rate, and the year 2008 to 2011 the trend is moving around the rate of
0.9 to 1.1.

0.9
0.95
1
1.05
1.1
1.15
1.2
2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY
Current ratio
Current ratio
Page | 48

FY Debt to equity ratio
2005 FY 13.96
2006 FY 14.01
2007 FY 15.16
2008 FY 15.42
2009 FY 12.84
2010 FY 13.07
2011 FY 13.00

Here we can see that, the trend in increasing in the year 2005 to 2008, then it falls
in the year 2009 to 2011.

7.3.3 Market Share Remittance:
FY Market share remittance (%)
2007 FY 19.00
2008 FY 22.00
2009 FY 26.00
2010 FY 28.00
2011 FY 26.00

0.00
2.00
4.00
6.00
8.00
10.00
12.00
14.00
16.00
18.00
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
FY
2011
FY
Page | 49

Here we can see that, the trend of market share remittance is increase at a
increasing rate in the year 2007 to 2010, but it falls in the year 2011.

7.3.4 Gross Profit Ratio:
FY Gross Profit ratio(%)
2007 FY 47
2008 FY 49
2009 FY 49
2010 FY 52
2011 FY 52

0.00
5.00
10.00
15.00
20.00
25.00
30.00
2007 FY 2008 FY 2009 FY 2010 FY 2011 FY
Market share remittance(%)
Market share
remittance(%)
Page | 50

Here we can see that the trend of gross profit ratio is increasing year by year and t
increase at a significant rate in the year 2010 & 2011.
7.3.5 Market Value per Share:
FY Market value per share
2007 FY 70
2008 FY 83
2009 FY 89
2010 FY 90
2011 FY 83.98

In market value per share, we see that, the trend is increasing at the year of 2007 to
2010 but it falls in the year 2011.
44
45
46
47
48
49
50
51
52
53
2007 FY 2008 FY 2009 FY 2010 FY 2011 FY
Gross Profit ratio(%)
Gross Profit ratio(%)
0
20
40
60
80
100
2007 FY 2008 FY 2009 FY 2010 FY 2011 FY
Market value per share
Market value per share
Page | 51

7.3.6 Price Earnings Ratio

FY Price earnings ratio
2007 FY 17.88
2008 FY 10.78
2009 FY 12.87
2010 FY 13.29
2011 FY 11.27

Here we see that, the price earnings ratio is falls in the year 2008 and the forward
year it moves at a moderate rate.

0
5
10
15
20
2007 FY
2008 FY
2009 FY
2010 FY
2011 FY
Price earning ratio
Price earning ratio
Page | 52

8.0 AB Bank LTD
AB Bank Limited, the first private sector bank was incorporated in Bangladesh on 31st
December 1981 as Arab Bangladesh Bank Limited and started its operation with effect from
April 12, 1982.

AB Bank is known as one of leading bank of the country since its commencement 29 years ago.
It continues to remain updated with the latest products and services, considering consumer and
client perspectives. AB Bank has thus been able to keep their consumer's and client's trust while
upholding their reliability, across time.

During the last 29 years, AB Bank Limited has opened 85 Branches in different Business Centers
of the country, one foreign Branch in Mumbai, India and also established a wholly owned
Subsidiary Finance Company in Hong Kong in the name of AB International Finance Limited.
To facilitate cross border trade and payment related services, the Bank has correspondent
relationship with over 220 international banks of repute across 58 countries of the World.

In spite of adverse market conditions, AB Bank Limited which turned 28 this year, concluded the
2008 financial year with good results. The Bank's consolidated profit after taxes amounted to
Taka 230 cr which is 21% higher than that of 2007. The asset base of AB grew by 32% from
2007 to stand at over Tk 8,400 cr as at the end of 2008.

The Bank showed strong growth in loans and deposits. Deposit of the Bank rose by Tk. 1518 cr
ie., 28.45% while the diversified Loan Portfolio grew by over 30% during the year and recorded
a Tk 1579 cr increase. Foreign Trade Business handled was Tk 9,898 cr indicating a growth of
over 40% in 2008.
8.1 Vision Statement
"To be the trendsetter for innovative banking with excellence & perfection"

8.2 Mission Statement
"To be the best performing bank in the country"

Now, lets have a look on the ratio analysis of AB Bank Ltd.

Page | 53

8.3 Analysis
8.3.1 Trend of Net Profit:

Net profit of AB Bank is increasing every year. It may be expected that this increasing income
trend might cause the future bond and stock holder to become more interested to buy more share
of stock and bond.
8.3.2Trend of Income Tax:

Income tax for AB Bank is fluctuating every year. This can be assumed that the bank is using
some of its profit for non-tax bearing operating activities or for increasing reserve.
0.00
500000000.00
1000000000.00
1500000000.00
2000000000.00
2500000000.00
3000000000.00
3500000000.00
4000000000.00
4500000000.00
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
Series1
0.00
200000000.00
400000000.00
600000000.00
800000000.00
1000000000.00
1200000000.00
1400000000.00
1600000000.00
1800000000.00
2000000000.00
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
Series1
Page | 54

8.3.3 Trend of Net Cash in hand:

AB Bank is using its net profit for retaining rather than providing dividend to the shareholders.
This is why net cash in hand is increasing every year. This may make the people to think that the
financial structure of AB Bank is getting stable day by day and that buying stocks from this Bank
is less risky.
8.3.4 Trend of Total asset:

Total asset trend for AB bank is also increasing day by day. This helps to assume that the bank is
using its cash and other asset in profitable activities.

0.00
2000000000.00
4000000000.00
6000000000.00
8000000000.00
10000000000.00
12000000000.00
14000000000.00
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
Series1
0.00
20000000000.00
40000000000.00
60000000000.00
80000000000.00
100000000000.00
120000000000.00
140000000000.00
160000000000.00
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
Series1
Page | 55

8.3.5 Trend of Total liabilities:

Liabilities of AB Bank is increasing at a slow rate which indicates that the Bank is trying to take
more liabilities and become more stable with its own cash and other assets.
8.3.6 Trend of Total shareholders equity:

Total shareholders equity is increasing day by day which interprets that the Bank is trying to
provide more dividends to satisfy and retain the stock and bond holders.

0.00
20000000000.00
40000000000.00
60000000000.00
80000000000.00
100000000000.00
120000000000.00
140000000000.00
FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010
0.00
2000000000.00
4000000000.00
6000000000.00
8000000000.00
10000000000.00
12000000000.00
14000000000.00
16000000000.00
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
Series1
Page | 56

8.3.7 Trend of Retained earnings:

The Bank is trying to retain half of its balance to use in profit generating activities and other half
to provide dividends to its stock and bond holders. Thats why the retain earning trend and
shareholders equity trend are more alike.

Return on asset in FY 2006 was very much satisfied but after the FY 2006 it is stable. This helps
to assume that the Bank is not that efficient is getting return on their assets.

0.00
1000000000.00
2000000000.00
3000000000.00
4000000000.00
5000000000.00
6000000000.00
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
FY
2010
Series1
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009
Series1
Page | 57

8.3.9 Return on equity (ROE)

Return on equity of AB bank is also stable after FY 2006. This is making the people less
interested in buying its bond and stocks.
8.3.10 Price Earnings Ratio (Times):

Till the FY 2009, the Banks price earnings ratio was decreasing at a decreasing rate. But after FY
2008, the price earnings ratio started increasing which is making the stock and bond holder
interested in buying stocks and bonds.

0.00
5.00
10.00
15.00
20.00
25.00
FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009
Series1
0.00
5.00
10.00
15.00
20.00
25.00
FY
2004
FY
2005
FY
2006
FY
2007
FY
2008
FY
2009
Series1
Page | 58


EPS of AB Bank is also increasing every year which is proved by the trend analysis. This
indicates that the holders of stocks and bonds are getting more profit by buying the stocks and
bonds and getting interested to buy more
8.3.12 Book Value per Share:

The Book Value trend of AB Bank is increasing at a slow rate every year.

0.00
20.00
40.00
60.00
80.00
100.00
120.00
140.00
FY 2004 FY 2005 FY 2006 FY
2007
FY 2008 FY 2009
Series1
0.00
100.00
200.00
300.00
400.00
500.00
600.00
FY 2004FY 2005FY 2006 FY
2007
FY 2008FY 2009
Series1
Page | 59

8.3.13 Capital Adequacy Ratio:

The trend shows that the capital adequacy ratio is stable for AB Bank. It indicates that the Banks
capital is much stable and the Bank is trying to keeps the structure unchanged.
8.3.14 Asset Utilization Ratio:

Till the FY 2008, the asset utilization ratio increased. But after the FY 2008, it fall down. It
indicates that the Bank is failing to utilize its asset in income generating activities.

0.00
2.00
4.00
6.00
8.00
10.00
12.00
14.00
16.00
FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009
Series1
0.00
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
FY 2004FY 2005FY 2006 FY
2007
FY 2008FY 2009
Series1
Page | 60

9.0 National Bank Ltd:
National Bank Limited is one of the leading private commercial bank having a spread network of
139 branches and 15 SME/Agri Branches (total 154 service locations) across Bangladesh and
plans to open few more branches to cover the important commercial areas in Dhaka, Chittagong,
Sylhet and other areas in 2010.
National Bank Limited has been licensed by the Government of Bangladesh as a Scheduled
commercial bank in the private sector in pursuance of the policy of liberalization of banking and
financial services and facilities in Bangladesh. In view of the above, the Bank within a period of
25 years of its operation achieved a remarkable success and met up capital adequacy requirement
of Bangladesh Bank.
National Bank Limited is a customer oriented financial institution. It remains dedicated to meet
up with the ever growing expectations of the customer because at National Bank, customer is
always at the center

Now, lets have a look on the ratios of National Bank Ltd.

Page | 61

9.1Analysis
9.1.1 Current Ratio
FY Current Ratio
2011 FY 1.34
2010 FY 1.30
2009 FY 0.18
2008 FY 0.86
2007 FY 0.86

Current Ratio was stable in first two years. Then it unexpectedly fell in 2009. And then it was
increasing and was stable till 2011.

-
0.20
0.40
0.60
0.80
1.00
1.20
1.40
1.60
2011 FY 2010 FY 2009 FY 2008 FY 2007 FY
Current Ratio
Current Ratio
Page | 62

9.1.2 Acid Test Ratio
FY Acid test ratio
2011 FY 1.460754653
2010 FY 1.450434417
2009 FY 0.205385722
2008 FY 0.989086356
2007 FY 0.940389251

Acid Test Ratio was increasing till 2008 but drastically fell in 2009. Then it started increasing
and was stable.

9.1.3 Cash Ratio
FY Cash ratio
2011 FY 0.081953348
2010 FY 0.072752664
2009 FY 0.092783127
2008 FY 0.104791053
2007 FY 0.095420822
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
2011 FY 2010 FY 2009 FY 2008 FY 2007 FY
Acid Test Ratio
Acid test ratio
Page | 63

There was the trend of decreasing at a decreasing rate till 2010. Then it was in the almost better
in 2011.

9.1.4 Total Asset Turnover
FY Total asset turnover
2011 FY 0.085858795
2010 FY 0.071363833
2009 FY 0.080159426
2008 FY 0.075871841
2007 FY 0.078517791

0
0.02
0.04
0.06
0.08
0.1
0.12
2011 FY 2010 FY 2009 FY 2008 FY 2007 FY
Cash Ratio
Cash ratio
Page | 64

Total Asset Turnover trend of NBL would quite straight but TAT suddenly fell in 2010.
9.1.5 Total Debt Ratio
FY Total debt ratio
2011 FY 0.872074454
2010 FY 0.858118212
2009 FY 0.91515458
2008 FY 0.919182087
2007 FY 0.930031278

Here, we see that the ratio line is decreasing at a decreasing rate. But in 2011, the value is quite
better than other years.
0
0.01
0.02
0.03
0.04
0.05
0.06
0.07
0.08
0.09
0.1
2011 FY 2010 FY 2009 FY 2008 FY 2007 FY
Total Asset Turnover
0.82
0.84
0.86
0.88
0.9
0.92
0.94
2011 FY 2010 FY 2009 FY 2008 FY 2007 FY
Total Debt Ratio
Total debt ratio
Page | 65

9.1.6 Capital Intensity
FY Capital Intensity
2011 FY 1.164703044
2010 FY 1.401270034
2009 FY 1.247513929
2008 FY 1.318012048
2007 FY 1.273596702

The trend is quite better till 2010. But in 2011 it is slightly decreased.
9.1.7 Debt to Equity Ratio
FY Debt to Equity Ratio
2011 FY 6.817046932
2010 FY 6.048120952
2009 FY 10.78614008
2008 FY 11.37349442
2007 FY 13.29210031

0 0.5 1 1.5
2011 FY
2010 FY
2009 FY
2008 FY
2007 FY
Capital intensity
Capital intensity
Page | 66

There is no sizable fluctuation in this trend. It is only increasing at an increasing rate till 2011.
9.1.8 Profit Margin
FY Profit margin
2011 FY 0.35329371
2010 FY 0.163139468
2009 FY 0.118838172
2008 FY 0.095474413
2007 FY 0.051126933

Profit Margin is only increasing at an increasing rate till 2011.
0
2
4
6
8
10
12
14
2011
FY
2010
FY
2009
FY
2008
FY
2007
FY
Debt to Equity Ratio
Debt to equity
ratio
0
0.1
0.2
0.3
0.4
2011
FY
2010
FY
2009
FY
2008
FY
2007
FY
Profit margin
Profit margin
Page | 67

9.1.9 ROA
FY ROA
2011 FY 0.303333723
2010 FY 0.116422576
2009 FY 0.095259996
2008 FY 0.072438194
2007 FY 0.040143739

ROA is just increasing in every year. But in 2011 it increases quite greatly.

9.1.10 ROE
FY ROE
2011 FY 2.371173948
2010 FY 0.8205604
2009 FY 1.122747656
2008 FY 0.896313593
2007 FY 0.57373834

0
0.05
0.1
0.15
0.2
0.25
0.3
0.35
2011 FY 2010 FY 2009 FY 2008 FY 2007 FY
ROA
ROA
Page | 68

ROE was increasing till 2009. However, it reduced in 2010. Then it increased quite greatly in 2011.
9.1.11 Price/Earnings Ratio
FY P/E ratio
2011 FY 2.370681885
2010 FY 1.686458534
2009 FY 0.891090188
2008 FY 0.85504408
2007 FY 0.742676468

P/E Ratio is just growing in every year. But in 2011 it rises quite significantly.
0
0.5
1
1.5
2
2.5
2011 FY 2010 FY 2009 FY 2008 FY 2007 FY
ROE
ROE
0
0.5
1
1.5
2
2.5
2011 FY 2010 FY 2009 FY 2008 FY 2007 FY
P/E ratio
P/E ratio
Page | 69

10.0Dutch-Bangla Bank Limited
Dutch-Bangla Bank Limited (DBBL) is Bangladesh's most innovative and technologically
advanced bank. DBBL stands to give the most innovative and affordable banking products to
Bangladesh. Amongst banks, DBBL is the largest donor in to social causes in Bangladesh. It
stands as one of the largest private donors involved in improving the country. DBBL is proud to
be associated with helping Bangladesh as well as being a leader in the country's banking sector
Dutch-Bangla Bank started operation is Bangladesh's first joint venture bank. The bank was an
effort by local shareholders spearheaded by M Sahabuddin Ahmed (founder chairman) and the
Dutch company FMO.
From the onset, the focus of the bank has been financing high-growth manufacturing industries
in Bangladesh. The rationale being that the manufacturing sector exports Bangladeshi products
worldwide. Thereby financing and concentrating on this sector allows Bangladesh to achieve the
desired growth. DBBL's other focus is Corporate Social Responsibility (CSR). Even though CSR
is now a clich, DBBL is the pioneer in this sector and termed the contribution simply as 'social
responsibility'. Due to its investment in this sector, DBBL has become one of the largest donors
and the largest bank donor in Bangladesh. The bank has won numerous international awards
because of its unique approach as a socially conscious bank.
Even with a history of hefty technological investments and even larger donations, consumer and
investor confidence has never waned. Dutch-Bangla Bank stock set the record for the highest
share price in the Dhaka Stock Exchange in 2008.
10.1 Mission
Dutch-Bangla Bank engineers enterprise and creativity in business and industry with a
commitment to social responsibility.
10.2 Vision
Dutch-Bangla Bank dreams of better Bangladesh, where arts and letters, sports and athletics,
music and entertainment, science and education, health and hygiene, clean and pollution free
environment and above all a society based on morality and ethics make all our lives worth living.
DBBL's essence and ethos rest on a cosmos of creativity and the marvel-magic of a charmed life
that abounds with spirit of life and adventures that contributes towards human development.

Now, lets have a look on the ratios of Dutch-Bangla Bank Ltd.
Page | 70

10.3Analysis
10.3.1 Total Revenue:
Year(FY) Total revenue
2002FY 1897.4
2003FY 2115.49
2004FY 2366.92
2005FY 3434.73
2006FY 5181.15
2007FY 6367.58
2008FY 7275.75

There is an increasing trend in Total Revenue of Dutch Bangla Bank Ltd.
10.3.2 Net Profit after Tax:
Year(FY) Net Profit after tax
2002FY 177.6
2003FY 210.16
2004FY 236.35
2005FY 367.82
2006FY 362.18
2007FY 479.81
2008FY 821.67
0
2000
4000
6000
8000
Total revenue
Total revenue
Page | 71

We see that Net Profit after Tax is increasing in every year except in the year 2006.
10.3.3 Total Assets
Year(FY) Total Assets
2002FY 17865.66
2003FY 19965.6
2004FY 24560.55
2005FY 32279.41
2006FY 45493.13
2007FY 49371.35
2008FY 60682.07

Total assets had been increased from 20000 to around 60000 since the FY2002 within 6 years.
0
200
400
600
800
1000
2002FY 2003FY 2004FY 2005FY 2006FY 2007FY 2008FY
Net Profit after tax
Net Profit after tax
0
10000
20000
30000
40000
50000
60000
70000
Total Assets
Total Assets
Page | 72

10.3.4 Total Capital
Year(FY) Total Capital
2002FY 909
2003FY 1136.29
2004FY 1474.5
2005FY 1909.26
2006FY 2663.77
2007FY 3399.49
2008FY 4615.98

Total capital is growing at an increasing rate that indicates the improvement of the bank.
10.3.5 Market Capitalization
Year(FY) Market capitalization
2002FY 822.69
2003FY 872.21
2004FY 3744.55
2005FY 4421.7
2006FY 3719.28
2007FY 3422.13
2008FY 2991.13

0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
2002FY 2003FY 2004FY 2005FY 2006FY 2007FY 2008FY
Total Capital
Total Capital
Page | 73

Market capitalization (or market cap) is the total value of the issued shares of this bank. It is almost
same in FY-2002 and FY-2003. There is a significant change in 2004. In 2005 it is the highest figure.
After that it decreases in FY-2006.

10.3.6 Earnings per Share
Year(FY)
Earning per
share
2002FY 87.86
2003FY 103.97
2004FY 116.93
2005FY 181.97
2006FY 179.18
2007FY 237.37
2008FY 82.17
2009 FY 45.12
2010 FY 35.13
2011 FY 28.11

0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
Market Capitalization
Market capitalization
Page | 74

From 2002 to 2004 the trend change is unremarkable. But in 2005 it increases remarkably and
stays almost unchangeable till 2006. Again increases in 2007.And it is continuously decreasing
till 2011.

10.3.7 Book Value per Share
Year(FY) Book value
2002FY 309.88
2003FY 391.85
2004FY 506.53
2005FY 667.18
2006FY 821.36
2007FY 1154.88
2008FY 322.06
2009 FY 315.11
2010 FY 211.12
2011 FY 195.11

0
50
100
150
200
250
Earnings per Share
Earning per share
Page | 75

The book value per share is had been growing at a swelling rate from 2002 to 2007. But it is
continuously decreasing from 2008 to till 2011.
10.3.8 Dividend per Share
Year(FY) Dividend per share
2002 20
2003 20
2004 22.5
2005 25
2006 25
2007 23
2008 29
2009 31
2010 32
2011 37

The dividend per share of DBBL in 2002 and 2003 was under 20. But from the year 2004, it is
more or less 25 to 35. The highest position is in the year in 2011.
0
200
400
600
800
1000
1200
1400
Book value
Book value
0
10
20
30
40
Dividend per share
Dividend per share
Page | 76

10.3.9 Closing Market Price

Year(FY) Closing market price
2002FY 407
2003FY 431.5
2004FY 1852.5
2005FY 2187.5
2006FY 1840
2007FY 6765.5
2008FY 4311

From 2002 to 2003 the trend change was unremarkable. Then it continued the trend of increasing
at an increasing rate till 2007. But significantly decreases in 2008.

0
1000
2000
3000
4000
5000
6000
7000
Closing market price
Closing market price
Page | 77

10.3.10 Loan Deposit Ratio

Year(FY) Loan deposit ratio
2002FY 59.00%
2003FY 66.72%
2004FY 71.09%
2005FY 74.70%
2006FY 70.62%
2007FY 69.82%
2008FY 80.85%

Loan Deposit ratio in DBBL is maintaining a simple trend that is increasing at an increasing rate.

0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
90.00%
2002FY 2003FY 2004FY 2005FY 2006FY 2007FY 2008FY
Loan deposit ratio
Loan deposit ratio
Page | 78

10.3.11 ROA
Year(FY) Return on total assets
2002FY 1.13%
2003FY 1.11%
2004FY 1.06%
2005FY 1.29%
2006FY 0.93%
2007FY 1.01%
2008FY 1.49%
2009 FY 1.67%
2010 FY 1.80%
2011 FY 1.98%

Up to 2005 the ROA trend was simply increasing. But it suddenly fell in 2006. Then it started the
trend of increasing at an increasing rate.

0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
Return on total assets
Return on total assets
Page | 79

10.3.12 Capital Adequacy Rate
Year(FY)
Capital adequacy
ratio
2002FY 10.09%
2003FY 10.23%
2004FY 10.45%
2005FY 10.16%
2006FY 10.05%
2007FY 11.76%
2008FY 10.96%
2009 FY 11.19%
2010 FY 12.13%
2011 FY 12.76%

It is more or less 10 from 2002 to 2009. Then it reached in the highest position in 2011 and the
value is above 12%.

0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
Capital adequacy ratio
Capital adequacy ratio
Page | 80

11.0 Final Average Analysis:
Now we will have the final analysis on several main categories on the total average of the seven
companies for the last five years and make a comparative analysis of the financial statements and
also some main ratios like ROA, ROE, P/E ratio and give a recommendations for the potential
investors on the basis of that decision.
11.1 The performance indicators
We will mainly cover different prospects under mainly four performance indicator category and
make a comparative financial performance analysis. The performance indicators are
Income statement performance indicators
o Net income after taxes
o Earnings per share
Balance sheet performance indicators
o Total assets
o Total liabilities
o Total shareholders equity
Cash flow performance indicators
o Dividend paid
o Income taxes paid
Ratio analysis performance indicators
o Return on assets
o Return on equity
o Price/Earnings ratio
Page | 81

11.1.1 Income statement performance indicators

11.1.1.1 Net Profit After Taxation:
This measures the net income after supplementing the tax. Here we get an idea about the income
of the company after giving all the interest and taxes . From here investors have an idea about the
net income of the company.
Companies 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY
Net Profit After
Taxation
Beximco
Pharma 353067878 545341273 624740307 1051648808 1198525342 754664721.6
Square Pharma 1248439017 1540620609 2115566576 2087871791 2532054550 1904910509
Dhaka Bank 703782843 838764573 959372816 1678976188 2242648272 1284708938
National Bank 507492348 1238110390 1517434482 6871559790 6112985936 3249516589
Islami Bank 2049053457 2674796768 3403551874 4485479878 4624593651 3447495126
AB Bank 532186349 2300621640 3362556000 3989519974

2546220991
Dutch Bangla
Bank 473810510 824665049
1070568293
2072340363

1110346054

Here from the above graph we have found the total average of the seven companies for the recent
five years from 2007 to 2011(four years for AB bank and Dutch Bangla Bank from 2007 to
2010) and got a comparative idea about the net profit after taxation found for those companies.
0
500000000
1E+09
1.5E+09
2E+09
2.5E+09
3E+09
3.5E+09
4E+09
Beximco
Pharma
Square
Pharma
Dhaka
Bank
National
Bank
Islami
Bank
AB Bank Dutch
Bangla
Bank
Net Profit After Taxation
Beximco Pharma
Square Pharma
Dhaka Bank
National Bank
Islami Bank
AB Bank
Dutch Bangla Bank
Page | 82

We have found that it is comparatively better in Isalmi Bank, National Bank and AB bank and
average position for Dhaka Bank, Square Pharma, Dutch Bangla Bank and comparatively lower
in Beximco Pharma.

11.1.1.2 Earnings per Share:
Earnings per share define how much a share can earn per financial years. That means how much
a shareholder can earn from a piece of share.
Earnings per
Share
Beximco
Pharma 2.8 4.33 4.13 4.18 4.76 4.04
Square Pharma 244.6 126.37 170.51 106.43 129.07 155.396
Dhaka Bank 36.39 39.42 45.09 4.68 6.25 26.366
National Bank 63.01 66.11 81.03 7.99 7.11 45.05
Islami Bank 375.46 43.3 55.1 4.48 4.62 96.592
AB Bank 85.37 103.18 131.13 7.11

81.6975
Dutch Bangla
Bank 47.98 82.17 3.13 6.05

34.8325

2010). The graph shows that it is the best for Square Pharma and average for Islami Bank, AB
bank, Dutch Bangla Bank, National Bank. But it is lower for Dhaka bank and in the worst
0
50
100
150
200
Beximco
Pharma
Square
Pharma
Dhaka
Bank
National
Bank
Islami Bank AB Bank Dutch
Bangla
Bank
Earnings per Share
Beximco Pharma
Square Pharma
Dhaka Bank
National Bank
Islami Bank
AB Bank
Dutch Bangla Bank
Page | 83

position the Beximco Pharama. That means where a potential shareholder can earn a maximum
level of income from Square Pharma But minimum from Beximco Pharma.
11.1.2 Balance sheet performance indicators

11.1.2.1 Total Property and Assets:
Total property and assets define the total value of the firm. So normal indication is that the
company with the most level of assets is the most valuable company. So every company tries to
gain and retain maximum level of asset and property.

Companies
2007 FY 2008 FY 2009 FY 2010 FY 2011 FY
Total Property and
Assets
Beximco
Pharma
11953418940 14819665441 19891933422 21372399509 23033340533
18214151569
Square
Pharma
12539030507 15058188280 14904565646 15196452304 19444409654
15428529278
Dhaka Bank 57443251307 71136842020 77767413094 90139480260 1.05037E+11 80304840101
National
Bank 46796044234 56526964115 72205000000 1.34748E+11
1.68555E+11
95766298075
Islami Bank 1.91362E+11 2.30879E+11 2.78303E+11 3.30785E+11 3.89376E+11 2.84141E+11
AB Bank 47989337222 84053612585 1.06912E+11 1.33707E+11

93165521660
Dutch Bangla
Bank
49371346238 60682073066 58920895401 78800401984
61943679172

Page | 84

2010). Here the graph shows that the most worthy company is the Islami Bank And in the
average position is Dhaka Bank, National Bank, Dhaka Bank and Dutch Bangla Bank. But in the
worst position is Beximco Pharma and Square Pharma. So overall here banking industries are
more worthier than pharmaceuticals companies.

11.1.2.2 Total Liabilities:
Total liabilities indicate the debt of a firm or liabilities toward the outside entities. if it is more
than the shareholders equity then the firm is based on debt financing.
Companies 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY Total liabilities
Beximco
Pharma 3702479293 4369463296 9006226808 5398313058 5905212356 5676338962
Square
Pharma 4259639730 5551255643 3978587430 3475120453 5626700664 4578260784
Dhaka Bank 54317562594 67137329964 72801731124 83559750872 95743416946 74711958300
National
Bank 43521784803 51958572827 66079000000 1.1563E+11 1.46993E+11 84836437819
Islami Bank 1.79521E+11 2.16819E+11 2.58197E+11 3.07269E+11 3.61762E+11 2.64714E+11
AB Bank 45406574310 77331107238 96825789451 1.1956E+11

84780854523
Dutch Bangla
Bank
47036921368
57461480883 53994262133 72052052654

57636179260

0
5E+10
1E+11
1.5E+11
2E+11
2.5E+11
3E+11
Beximco
Pharma
Square
Pharma
Dhaka
Bank
National
Bank
Islami
Bank
AB Bank Dutch
Bangla
Bank
Total Property and Assets
Beximco Pharma
Square Pharma
Dhaka Bank
National Bank
Islami Bank
AB Bank
Dutch Bangla Bank
Page | 85

2010). Here we can see that the graph is in the peak for Islami Bank and average position for rest
of the banks. But for the pharmaceuticals company it is in the least position that means they are
mainly based on shareholders equity financing which means banks are where debt finace based
the pharmaceuticals companies are equity based.

11.1.2.3 Total Shareholders Equity:
Total Equity means how much in the capital that comes from shares and stocks. That means how
much in the value of the company is owned by the shareholders.
Companies 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY Total Equity
Beximco
Pharma 3702479293 4369463296 9006226808 5398313058 5905212356 5676338962
Square
Pharma 8279390777 9506932637 10925978216 11721331851 13817708990 10850268494
Dhaka Bank 3125688713 3999512056 4965681970 6579729388 9293796879 5592881801
National
Bank 3274259431 3274259431 3274259431 3274259431 3274259431 3274259431
Islami Bank 11841336254 14060491979 20105543853 23516276731 27613754893 19427480742
AB Bank 2582762912 6722505347 10086522932 14146877357

8384667137
Dutch Bangla
Bank 2,334,424,870 3,220,592,183 4,926,633,268
6,748,349,330

4307499913

0
5E+10
1E+11
1.5E+11
2E+11
2.5E+11
3E+11
Beximco
Pharma
Square
Pharma
Dhaka
Bank
National
Bank
Islami
Bank
AB Bank Dutch
Bangla
Bank
Total liabilities
Beximco Pharma
Square Pharma
Dhaka Bank
National Bank
Islami Bank
AB Bank
Dutch Bangla Bank
Page | 86

2010). Here Islami Bank again possess highest position only because it has higher asset than
those companies. But here we can see that there is dramatic change in pharmaceuticals
companies because they are mainly equity based companies. And it is seen that the position for
banks are in average.
11.1.3 Cash flow performance indicators
11.1.3.1 Dividend:
Dividend is the extra payment on the earnings of the company to their shareholders

0
5E+09
1E+10
1.5E+10
2E+10
2.5E+10
Beximco
Pharma
Square
Pharma
Dhaka
Bank
National
Bank
Islami
Bank
AB Bank Dutch
Bangla
Bank
Total Equity
Beximco Pharma
Square Pharma
Dhaka Bank
National Bank
Islami Bank
AB Bank
Companies 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY Dividend paid
Beximco
Pharma 131700637 57369278 127399591 153969825 146447 94117155.6
Square Pharma 372600000 298080000 357696000 482889600 528160500 407885220
Dhaka Bank 128950190 0 290137931 0 0 83817624.2
National Bank

4191524730 4191524730
Islami Bank 518400000 0 0 671032298 0 237886459.6
AB Bank 125277075 896758330 1330452291 1878055366

1057635766
Dutch Bangla
Bank
442366370
487630798
827808559 1183389806

735298883.3
Page | 87

2010). We can see that more or less National Bank pay the highest amount of money as
dividends.

11.1.3.2Net Income Taxes Paid:
It measures how much money institutions pay as income taxes. If the net inacome is high then its
income taxes will be high which indirectly indicates that the companies are performing well
when they will pay higher income taxes.
0
500000000
1E+09
1.5E+09
2E+09
2.5E+09
3E+09
3.5E+09
4E+09
4.5E+09
Beximco
Pharma
Square
Pharma
Dhaka
Bank
National
Bank
Islami
Bank
AB Bank Dutch
Bangla
Bank
Dividend paid
Beximco Pharma
Square Pharma
Dhaka Bank
National Bank
Islami Bank
AB Bank
Dutch Bangla Bank
Page | 88

2010). Here we can see that Islami Bank pays the highest income taxes where AB bank also pays
-5E+09
0
5E+09
1E+10
1.5E+10
2E+10
2.5E+10
Beximco
Pharma
Square
Pharma
Dhaka
Bank
National
Bank
Islami Bank AB Bank Dutch
Bangla
Bank
Net Income Taxes Paid
Beximco Pharma
Square Pharma
Dhaka Bank
National Bank
Islami Bank
AB Bank
Dutch Bangla Bank
Net Income
Taxes Paid
Beximco
Pharma 32303532 71277001 73492878 179406569 154331358 102162267.6
Square Pharma 361758705 467509044 505424834 855888639 802383301 598592904.6
Dhaka Bank 346149168 708933737 889049549 1254041351 1316114201 902857601.2
National Bank 471998741 449757600 761756675 1375039771
-
1723941770 956498911.4
Islami Bank 2007639120 2388748170 3597024602 93219920701 4055740794 21053814677
AB Bank 6738242780 6773235501 8451964119 11853790152

8454308138
Dutch Bangla
Bank 371486415 969630087 40,536,536 53811688

358866181.5
Page | 89

a good amount of money as income taxes. And the other companies pay very little income taxes
comparatively these two organizations.

11.1.4. Ratio Analysis Performance Indicators
11.1.4. 1Return on Assets (ROA) Ratio:
Companies 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY Return on Assets
Beximco
Pharma

0.27

0.27

0.22

0.24

0.26

0.25
Square Pharma

0.33

0.34

0.42

0.45

0.43

0.39
Dhaka Bank 1.23 1.18 1.29 2 2.22

1.58
National Bank 0.04

0.07

0.10

0.12

0.30

0.13
Islami Bank 0.84 1.27 1.34 1.47 1.35

1.25
AB Bank 3.41 3.12 3.52

3.35
Dutch Bangla
Bank 1.01 1.49 1.67 1.8 1.98 1.59

-
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
Beximco
Pharma
Square
Pharma
Dhaka
Bank
National
Bank
Islami
Bank
AB Bank Dutch
Bangla
Bank
Return on Assets
Beximco Pharma
Square Pharma
Dhaka Bank
National Bank
Islami Bank
AB Bank
Dutch Bangla Bank
Page | 90

2010). Here we can see that ROA is higher in AB bank and moderately it is in good position for
Dutch Bangla Bank, Islami Bank, Dhaka Bank but it is quite low for two pharmaceuticals
company and National Bank.

11.1.4.2 Return on Equity:
Companies 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY Return on Equity
Beximco
Pharma

0.39

0.38

0.39

0.32

0.34

0.37
Square Pharma

0.50

0.53

0.58

0.58

0.60

0.56
Dhaka Bank

22.53

20.97

19.32

25.52

23.49

22.37
National Bank

0.57

0.90

1.12

0.82

2.37

1.16
Islami Bank

13.00

19.00

17.00

19.00

17.00

17.00
AB Bank

20.80

21.04

21.06

20.97
Dutch Bangla
Bank

0.01

0.01

0.02

0.03

0.02

-
5.00
10.00
15.00
20.00
25.00
Beximco
Pharma
Square
Pharma
Dhaka
Bank
National
Bank
Islami
Bank
AB Bank Dutch
Bangla
Bank
Return on Equity
Beximco Pharma
Square Pharma
Dhaka Bank
National Bank
Islami Bank
AB Bank
Dutch Bangla Bank
Page | 91

2010). Here we can see that ROE is higher in Dhaka Bank and AB Bank and moderately it is in
good position for Islami Bank, but it is quite low for two Pharmaceuticals Company and National
Bank and Dutch Bangla Bank.
11.1.4. 3 Price Earnings Ratio:

2010). Here we can see that PE is higher in Islami Bank and Dhaka Bank and AB Bank and but
it is quite low for two Pharmaceuticals Company and National Bank and National Bank.

0
2
4
6
8
10
12
14
Beximco
Pharma
Square
Pharma
Dhaka Bank National
Bank
Islami Bank AB Bank
Price Earning Ratio( TIMES)
Beximco Pharma
Square Pharma
Dhaka Bank
National Bank
Islami Bank
AB Bank
Price Earning Ratio(
TIMES)
Beximco
Pharma 0.690257715 0.705157764 0.547242261 0.747416613 0.743623277 0.686739526
Square
Pharma 0.660289547 0.631346378 0.733062504 0.77132028 0.710626305 0.701329003
Dhaka
Bank 15.33 9.15 10.72 12.09 7.46 10.95
National
Bank 0.74267 0.85504 0.89109 1.68645 2.37068 1.309186
Islami Bank 17.88 10.78 12.87 13.29 11.27 13.218
AB Bank 10 7.97 8.97

8.98
Page | 92

12.0 Conclusion

The practice of corporate finance is more challenging and exciting than ever before. Both the
theory and practice of corporate finance have been moving ahead with uncommon speed. The
last decade has been fundamental changes in financial markets and financial instruments.
Corporate Finance includes several financial modules and financial components used against
organizations statements. In analyzing different companies individually, we use various ratios
and financial trends. By these calculations, we want to show how they are performing in
different years and the fluctuations they have in altered operating years. Here we have the final
analysis on several main categories on the total average of the seven companies for the last five
years and make a comparative analysis of the financial statements and also some main ratios like
ROA, ROE, P/E ratio and give recommendations for the potential investors on the basis of that
decision.

12.1 Research Findings

Basically we follow the benchmarking technique to analyze several categories of the selected
companies. We compare every single of those selected companies in a group of with the
benchmark companies.
Considering net profit after taxation we can easily conclude that Islami Bank Bangladesh Ltd.
has the most outstanding performance. National Bank and AB Bank are also doing well. Average
position for Dhaka Bank, Square Pharma, Dutch Bangla Bank and comparatively lower
condition in Beximco Pharma.
In case of it is the best for Square Pharma and average for Islami Bank, AB bank, Dutch Bangla
Bank, National Bank. But it is lower for Dhaka bank and in the worst position the Beximco
Pharama. That means where a potential shareholder can earn a maximum level of income from
Square Pharma But minimum from Beximco Pharma.
From the perspective of total property and asset the most worthy company is the Islami Bank
And in the average position is Dhaka Bank, National Bank, Dhaka Bank and Dutch Bangla
Bank. But in the worst position is Beximco Pharma and Square Pharma. So overall here banking
industries are worthier than pharmaceuticals companies.
For the pharmaceuticals company total liabilities is in the least position that means they are
mainly based on shareholders equity financing which means banks are where debt financing
based the pharmaceuticals companies are equity based.
In case of total equity Islami Bank again possess highest position only because it has higher asset
than those companies. But here we can see that there is dramatic change in pharmaceuticals
Page | 93

companies because they are mainly equity based companies. And it is seen that the position for
banks are in average.
National Bank paid the highest dividends according to the last couple of years. AB Bank Ltd and
Dutch Bangla Bank Ltd also paid money as dividends at an average rate. Poor condition in
Beximco Pharma Ltd, Square Pharma Ltd, Islami Bank Bangladesh Ltd and Dhaka Bank Ltd. So
it is best for the investors to invest in National Bank Ltd and it would be wise decision not to
invest in Dhaka Bank Ltd and Beximco Pharma Ltd.
As AB Bank Ltd, Dutch Bangla Bank Ltd, Dhaka Bank Ltd and Islami Bank Bangladesh Ltd
have the returns above the industry average of total Return on Asset among the selected
companies, it results from their high basic earning power plus low interest costs resulting from
their below average use of debt. So their net incomes are relatively high. On the other hand the
net income of National Bank Ltd, Square Pharma Ltd and Beximco Pharma Ltd is relatively low.
The industry average of return on equity is 8.92. The return on equity of Dhaka Bank Ltd, Islami
Bank Bangladesh Ltd and AB Bank Ltd is above than the average. Their better results are due to
their greater use of debt.
As we know Price/Earning ratio is higher for firms with strong growth prospects, other thing
held constant, But they are lower for riskier firms. Since P/E ratio of Islami Bank Ltd, Dhaka
Bank and AB Bank Ltd is higher than the Industry average of these organizations they are better
in position where investors are willing to pay per taka of reported profits. On the other hand
since the P/E ratio of Square Pharma Ltd, Beximco Pharma Ltd and National Bank Ltd is below
the industry average, it suggests that the companies are regarded as being somewhat riskier than
others as having poorer growth prospects.

12.2 Recommendations

The total asset of any company should be sufficient compared to the liabilities.
Liquid money should be expanded to make sustainable future.
Stock sector should be improved to have a sound financial statement.
The investors should buy the stock of those companies which have the higher return on
asset than the industry average. Because the returns above the industry average results
from high basic earning power plus low interest costs resulting from their below average
use of debt. So in this case the net incomes are relatively high.
The more the return on equity, the better the company is because of its better use of debt.
So the investors should keep it in their mind.
The investors should invest considering the Price/Earning ratio as we know Price/Earning
ratio is higher for firms with strong growth prospects, other thing held constant.

Page | 94

12.3 References

A. Books & Journals

Corporate Finance -Stephen A.Ross, Randolph W. Westerfield & Jeffrey Jaffe.
Fundamentals of Financial Management-Brigham & Houstom
Analysis of Financial Statement-Charies H. Gibson
Working capital and profitability- an empirical analysis. The Management Accountant,
Vol, 39 (6), pp 120-127.- Narware P. C. (2004).

B. Websites

www.investopedia.com
www.islamibankbd.com
www.dhakabank.com
www.square_pharma.com
www.beximcopharma.com
www.dbbl.com
www.nationalbank.bd
www.ab_bank.com

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