Final Analysis Report of L & T

Financial analysis
Of
LARSEN AND TOUBRO
A Project report
Submitted to
Mr. Shakti Dodiya
Faculty Member,
S.K. School of Business Management,
Hemchandracharya North Gujarat University
On
December
In partial fulfilment of the requirements for the

Managerial Accounting 1 Course in the Master
Of business Administration Programme
By
KARANGIYA VIJAY (21),
PRAJAPATI RAHUL (50)
S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN
EXECUTIVE SUMMARY
Project objective:
Financial analysis of LARSEN AND TOUBRO for 2006 to 2015, Analysis and interpretation of
the various financial statements like P&L A/C, Balance sheet and common size statement.
Extent of study:
We are analyzing the annual report of LARSEN AND TOUBRO for 2006 to 2015. The
project presents the details of financial position of company. We are required to prepare this
project report to develop the financial analysis and interpretation skill. The project enables us
interact with the real corporation Real economy and real words problem..
Limitation of the study:
A study of annual report doesnt provide full information of firm. An interpretation based on
financial statement may prove wrong. Comprehensive study of various financial aspects requires
covering other statement also the purpose of annual report is to shareholders Investors and
creditors only. It doesnt focus on internal accounting and situation business
Significance and need of financial analysis:
A prospective managers work is to get data. Pit them into logical order. Analyze and derive
correct decision from the data. So a potential manager must have an ability to analyze, interpret
and derived optimal solution of the problem. To prepare various statements do not mean. We are
no proper part but the task is to decision making and forward.
PREFACE
We had decided to prepare the project report on LARSEN AND
TOUBRO Under the subject of Financial Accounting.
In todays competitive world of business the value of
management is enhancing day by day. Management play
important role. So, practical studies is necessary along with the
theoretical studies.
By preparing the project report we can understand the original
scenario.
The following report by our sincere effort includes all the possible
aspects of LARSEN AND TOUBRO. This report also includes
graphical representation where ever it is necessary..
S.K. School of business Management,

Hemchandracharya North Gujarat University,
Patan.
Date:
Place: Patan
ACKNOWLEDGEMENT
I and vijay, the student of S.K. School of Business

Management, has worked out on the project entitled l&T.
Having number of options we have put our best to make this
project a successful one within our scope and time.
First of all, our heartfelt thanks to our Accounting Faculty, Mr.
Shakti Dodiya, who helped us in every possible manner. He
ensured a proper environment to work in. He allowed complete
freedom to complete our work. We also thanks to all the members
for their selfless co-operation and help for completion of this
project.
We do not find proper words to express our deep sense of
gratitude for the help rendered by our all friends for extending
their helping hands whenever and where required.
CHAPTER
NO.
CONTENTS
PAGE NO.
EXECUTIVE SUMMARY
PRAFACE
ACKNOWLEDGEMENT
CHAPTER -1. GENERAL INFORMATION
CHAPTER -2. ANALYSIS OF BALANCE SHEET
14
CHAPTER -3. ANALYSIS OF PROFIT &LOSS

ACCOUNT
22
CHAPTER -5. RATIO ANALYSIS & COMMON SIZE

ANALYSIS
26
CHAPTER -6. RECOMMENDATION & SUGGESTIONS
54
BIBLIOGRAPHY
56
ANNEXURES/APPENDICES
57
LIST OF TABLES
CHAPT
ER.
NO.
TABLE
S NO..
TABLES
PG.
NO.
ANALYSIS OF BALANCE SHEET

2.1
2.2
2.3
2.4
Statement of Balance Sheet

Tread Statement of Balance Sheet
Vertical Statement of Balance Sheet
Horizontal Statement of Balance Sheet
ANALYSIS OF PROFIT & LOSS ACCOUNT
3
3.1
3.2
3.3
3.4
5
Statement of profit and loss account

Trend Statement of Profit and Loss
Vertical Statement of Profit and Loss Account
Horizontal Statement of Profit and Loss Account
RATIO ANALYSIS
5.1.1
5.1.2
5.1.3
5.2.1
5.2.2
5.2.3
5.2.4
5.2.5
5.3.1
5.3.2
5.3.3
5.3.4
5.3.5
5.4.1
5.4.2
5.4.3
5.4.4
Current Ratio
Quick Ratio
Net Working Capital
Gross Profit ratio
Operating Profit Ratio
Net Profit Ratio
Rate of Return On Investment
Rate of Return On Equity
Total Assets Turn Over Ratio
Net Fixed Assets Turn Over Ratio
Inventory Turnover Ratio
Average Age of Inventories
Debtors Turn Over Ratio
Equity Ratio
Debt Ratio
Debt Equity ratio
Interest Coverage Ratio
14
14
15
17
19
21
21
22
24
25
26
26
29
31
33
35
36
37
38
40
41
42
43
44
47
48
49
51
5.4.5
5.5.1
5.5.2
DCR
Earnings Per Share
Dividend Pay Out Ratio
52
53
54
LIST OF GRAPH
CHAPT GRAP
ER.
HS
NO.
NO..
1
2
GRAPHS
PG.
NO.
GENERAL INFORMATION
ANALYSIS OF BALANCE SHEET

2.1
Statement of Balance Sheet
2.2
2.3
Tread Statement of Balance Sheet

Vertical Statement of Balance Sheet
2.4
Horizontal Statement of Balance Sheet
16
ANALYSIS OF PROFIT & LOSS

ACCOUNT
3.1
Statement of profit and loss account
3.2
3.3
Trend Statement of Profit and Loss

Vertical Statement of Profit and Loss
Account
Horizontal Statement of Profit and Loss
Account
3.4
5
23
RATIO ANALYSIS
4.1.1
4.1.2
4.1.3
4.2.1
4.2.2
4.2.3
4.2.4
4.2.5
4.3.1
4.3.2
4.3.3
4.3.4
4.3.5
Current Ratio
Quick Ratio
Net Working Capital
Gross Profit ratio
Operating Profit Ratio
Net Profit Ratio
Rate of Return On Investment
Rate of Return On Equity
Total Assets Turn Over Ratio
Net Fixed Assets Turn Over Ratio
29
31
33
35
36
37
38
40
41
42
43
44
4.3.6
Debtors Turn Over Ratio
46
4.4.1
Equity Ratio
48
27
4.4.2
4.4.3
4.4.4
4.4.5
4.5.1
4.5.2
Debt Ratio
Debt Equity ratio
Interest Coverage Ratio
DCR
Earnings Per Share
Dividend Pay Out Ratio
49
50
51
52
53
54
CHAPTER 1
GENERAL INFORMATION
(1.1)
Overview:
L&Ts capability spectrum embraces Coal and Gas based projects. Our expertise
encompasses virtually every aspect of design, engineering, manufacture, construction and
project management.
L&T Power is part of the Larsen & Toubro Group, with a mandate to integrate L&Ts varied
offerings in the thermal power sector. It is uniquely positioned to combine rich and diverse
strands of experience in engineering, manufacturing and project execution with strong
management focus on providing turnkey solutions. L&T Power seeks to partner with its
customers in providing solutions that best address their needs. In-house strengths are
supplemented by collaborations with global leaders in the fields of engineering and
manufacturing. L&T Power is also committed to continually upgrading its skills to meet the
challenge of the future.
L&T Power has world-class manufacturing facilities at Hazira near Surat (Gujarat) for
supercritical boilers, steam turbines, generators, pressure piping, axial fans, air-preheaters
and electrostatic precipitators.
Its pan-India presence includes multiple project sites and project management centres at
Vadodara, Faridabad and Chennai.
(1.2)
VISION:
L&T Power shall be India's most preferred provider of equipment, services and turnkey
solutions for fossil fuel-based power plants and a leading contributor to the nation's power
generation capacity.
(1.3)
MISSION:
L&T Power shall provide products based on efficient and environment-friendly technology,
consistently surpassing customer expectations of quality and on-time delivery.
L&T Power shall follow fair, transparent and ethical practices in its interactions with all
stakeholder and achieve performance excellence by innovation and continuous improvement
in people, product and services.
L&T Power shall foster a culture of care, trust, challenge and empowerment among its
employees.
(1.4)
Founded:
Preindependence: A company was founded in Bombay (Mumbai) in 1938 (British India) by
two Danish engineers, Henning Holck-Larsen and Soren Kristian Toubro. The company
began as a representative of Danish manufacturers of dairy equipment. However, with the
start of the Second World War in 1939 and the resulting restriction on imports, the partners
started a small workshop to undertake jobs and provide service facilities.
(1.5)
Product:
In addition to undertaking turnkey projects, L&T Power also offers equipment and other
services for power plants.
Coal Based Power Plants
Gas Based Power Plants
Machinery & Industrial Products company
(1.6)
L&T-Case Equipment Private Limited
L&T Komatsu Limited (LTK)
Tractor Engineers Limited (TENGL)
Audco India Limited (AIL)
L&T-Demag Plastics Machinery Limited
EWAC Alloys Limited
OTHER DETAILS OF COMPANY:

1) Brief profile
Larsen & Toubro Limited (L&T) is a technology, engineering, construction and
manufacturing company. It is one of the largest and most respected companies in India's
private sector. More than seven decades of a strong, customer-focused approach and the
continuous quest for world-class quality have enabled it to attain and sustain leadership in
all its major lines of business. L&T has an international presence, with a global spread
of offices. A thrust on international business has seen overseas earnings grow

significantly. It continues to grow its global footprint, with offices and manufacturing
facilities in multiple countries.
The company's businesses are supported by a wide
marketing and distribution network, and have established a reputation for strong customer
support.
2) Services: Financial Services company
L&T International FZE
L&T Urban Infrastructure Limited
L&T Infrastructure Finance Limited
L&T L&T Finance Limited
L Capital Company ltd. (LTCCL): Subsidiary Company
L&T Infrastructure Development Projects Ltd. (L&TIDPL): Subsidiary Company

3) Banker
State bank of India
ICICI bank ltd,
Union bank of India,
Dena Bank,
Bank of India etc
4) Chairman:
AM Naik
5) Managing director:
Sanjay Jalona
6) Company secretary:
N Hariharan
7) Auditor:
Sharp & Tannan
8) Industry:
Engineering Construction
9) House:
L&T
10)
BSE code:
500510
11) NSE symbol:
LT
12)
ISIN NO:
INE018A01030
13)
Face value:
14)
Listing:
BSE, NSE, London, Luxembourg, MCX
15)
BSE Group:
16)
Reuter code:
LART.BO
17)
Bloomberg code:
LT IN
18)
NIC activity:
Construction And Maintenance Of Motorways,

Streets, Roads,
OtherVehicular And Pedestrian Ways,
Highways, Bridges,
Tunnels And Subways
19)
NIC code:
42101
20)
Address:
13A/B 2nd Floor,
Samitha Warehousing Complex,
Behind Sakinaka Telephone Exchange,
Andheri Kurla Road,
Sakinaka, Andheri (East),
Mumbai,400072
21)
Phone no:
022-67720300/67720400
22)
Website:
www.larsentoubro.com
CHAPTER 2
Analysis of Balance Sheet
2.1 BALANCE SHEET
2.2 Trend Analysis
Total Share Capital
Equity Share Capital
Share Application Money
Init. Contribution Settler
Preference Share
Application Money
Employee Stock Opiton
Networth
Secured Loans
Unsecured Loans
Minority Interest
Policy Holders Funds
Total Liabilities
Gross Block
Less: Revaluation Reserves
Less: Accum. Depreciation
Capital Work in Progress
Investments
Inventories
Cash and Bank Balance
Total Current Assets
Loans and Advances
Advances
Deferred Credit
Current Liabilities
Provisions
ns
Net Current Assets
Minority Interest
Group Share in Joint Venture
enses
Total Assets
Source : Dion Global

Solutions Limited
Capital
ds
INTERPRETATION:
2012: The total equity share capital was 100 which is equal to previous year
2011 and the reserves 117.35 are which is increased than previous year.
2013: The total equity share capital was 100. The reserve is again increased
with 135.41.
2014: The reserve is again increased by 150.64. The secured loan 307.85. Is
and unsecured loan is 277.56 which show that the company has created
trust in market.
2015: The reserve is 163.44. This is good sign for companys growth. The
secured loan is 425.42. And unsecured loan is 2584.88 which show that the
company has created trust in market.
2.3 Vertical Analysis
INTERPRETATION:
2011: The total equity share is 0.22and equity share is 0.22out of total
liabilities which we considered as 100. The reserves are 45.33which are very
good for a company. We considered total asset as 100 than the total current
assets, loans and advances are 104.75which are good for company.
2012: The total equity share 0.17 and equity share is 0.17 out of total
liabilities which we considered as 100 which is less than previous year 2011
and the reserves are 40.3.The secured loan is 41.95. Total asset are
considered as 100 than the total current assets, loans and advances are
103.89 which shows that the companys result is good.
2013: The total equity share is 0.13 and equity share is 0.13 out of total
liabilities which we considered as 100 which is again less than previous year
2012 and the reserves are 36.98. The secured loan is 39.39. Total asset are
considered as 100 than the total current assets, loans and advances are
101.55.which is less compared to previous.
2015: The total equity share is 0.15 and equity share is 0.15 out of total
liabilities which we considered as 100 which is again less than previous years
and the reserves are 31.76. The secured loan is 36.24 and unsecured loan is
which 27.95.shows that the company has created trust in market. Total asset
are considered as 100 than the total current assets, loans and advances are
104.8 which is very good.
2.4 Horizontal Analysis
INTERPRETATION:
1. Total share capital:

Total share capital increases in march,2015 by 0.53. This is
beneficial to organization.
2. Equity share capital:
Equity share total share capital increases in march,2015
by 0.53. This is beneficial to organization.
3. Secured loans:
Secured loans taken by organization in year 2015 are
decreased by 14.36 compared to 2014. This is god for organizations safety.
4. Unsecured loans:
Unsecured loans taken by organization in year 2015 are
decreased by 33.28 compared to 2014. This is god for organizations safety.
5. Total debt:
Secured and Unsecured loans taken by organization are
decreased by 33.28 % compared to 2015. This is beneficial for company.
6. Total liabilities:
Total liabilities are decreased in 2015 compared to 2014. This is
god forcompany.
Chapter: 3
ANALYSIS OF PROFIT & LOSS ACCOUNT
3.1
PROFIT & LOSS ACCOUNT (Rs. In cr.)
3.2 TREND ANALYSIS OF PROFIT & LOSS ACCOUNT
Sales Turnover
Excise Duty
Net Sales
ome
Stock Adjustments
Total Income
Expenditure
rials
Power & Fuel Cost
Employee Cost
Other Manufacturing
Expenses
d Admin
Miscellaneous Expenses
Preoperative Exp
Capitalised
Total Expenses
g Profit
Interest
PBDT
Depreciation
tten Off
Profit Before Tax
Extra-ordinary items
PBT (Post Extra-ord Items)
Reported Net Profit
Total Value Addition
Preference Dividend
vidend
Corporate Dividend Tax
Per share data

(annualised)
Shares in issue (lakhs)
er Share (Rs)
Equity Dividend (%)
Source : Dion Global

Solutions Limited
INTERPRETATION:
The total Income in 2011 was 100 which increased in 2012 which was
120.002 and it was continuously decreased respectively 116.345, 91.964 and
101.659 in 2013, 2014 and 2015.
The depreciation in 2011 was 100, in 2012 was 116.728, in 2013 it
was117.015, in 2014 it was 96.817and in 2015 it was 127.224 which is
continuously decreasing.
3.3 VERTICAL ANALYSIS OF PROFIT & LOSS ACCOUNT

INTERPRETATION:
The total Income in 2011 was 104.58 as we considered Net Sales as 100. In
2012 it decreased and was 103.64. While in 2013 it was increased with
105.32 and in 2015 it was 105.12.
The Operating Profit in 2011 was 12.84and in 2015 it was 11.38.
3.4 Horizontal Analysis
INTERPRETATION:
In above table we have done profit and loss account analysis, it shows the
increase or decrease in different aspects of profit and loss, we have also
shown percentage increase or decrease in the important parts of the profit
and loss. Net Sales: Net Sales growth by 8.08%. Which is very good for the
company. Expenses: Increase in total expenses 8.83%, interest charges is
decreased by 9.25%.Tax: Tax provision higher by 30.27% Profit before tax is
decreased by 14.27%.
Chapter: 5
RATIO ANALYSIS
5.1 Liquidity Ratios
5.2 Profitability Ratios
5.3 Assets Turnover Ratio
5.4 Finance Structure Ratios
5.5
Valuation Ratio
5.1 Liquidity Ratio:

5.1.1 Current Ratio:
1.40
1.20
1.11
1.00
0.80
0.60 0.68
0.79
1.19
1.23
1.08
0.77
0.65
0.40
0.65
0.56
0.20
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Interpretation:
Current assets include inventories, debtors, bills receivable, marketable
securities, cash and bank balance.
While current liabilities includes creditors, bills payable, unpaid expenses,
provision for tax, proposed dividend, bank overdraft.
2015:-The current ratio for the year 2015 is 1.26:1 the ideal current ratio is
2:1 so the company is doing good. As it able to pay its total liabilities and
nearby the ideal current ratio.
2014:- In this year the current ratio is 1.16:1 it is also good that company
has maintained its capacity of paying current liabilities. Company is making
the efficient utilization of its current assets as well it is able to pay its whole
liabilities.
2013:- In the year 2013 the current ratio is 1.2:1 it is nearbyideal current
ratio.So we can say that company is doing well.
2012:- In the year 2012 the current ratio is 1.24:1 we can say that company
has ideal current ratio. The current assets and current liabilities are ideal as
per the company.
2011:- In the year 2011 the current ratiois 1.19:1 it is nearby ideal ratio. We
can say that company is doing well.
2010:- In the year 2010 the ratio is 2.04:1 it means that company has the
ability to pay its whole liability. So it is good.
2009:- In this year the current ratio is 1.85:1 is also good that company is
able to pay its total current liability and managing its business. So it is good.
2008:- In this year the current ratio is 1.74:1 it is good that company has
utilizing its assets efficiently.
2007:- In this year the current ratio is 2.18:1 it means that company has
maintaining its assets and using it efficiently.
2006:- In this year the current ratio is 1.65:1 It is good as the company has
the ability to pay its liabilities as well it is making the efficient utilization of
its assets.
5.1.2 Quick Ratio
Quick Assets:
Quick ratio:
1.00
0.90
0.80
0.80
0.70
0.60
0.50 0.58
0.67
0.66
0.54
0.72
0.86
0.71
0.55
0.40
0.48
0.30
0.20
0.10
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Interpretation:
Ideal quick ratio is 1:1
2015:- In the year 2015 the quick ratio is 1.19:1 it can be said that the ratio
is nearby ideal ratio. Company has the ability to pay its quick liabilities. But
the quick liabilities are more so the company should have to increase its
quick assets.
2014:- In the year 2014 the quick ratio is 1.05:1 company does not has the
ability to pay its quick liability so it should have to increase its quick assets.
2013 :- In the year 2013 the quick ratio is 1.09:1. It is good for the firm.
Company has the ability to pay its quick liability. This should be maintained
by the company.
2012:- In the year 2012 the quick ratio is 1.1:1 it is also good for the
company. Company is near to ideal ratio, in this year the company has the
Capacity to pay its whole quick assets.
2011:- In this year the quick ratio is 1.08:1 it is not good as the company
does not have the capacity to pay its quick liabilities.
2010:- In the year 2010 the quick ratio is 1.79:1 it very bad as the company
does not has the ability to pay at least half of its quick liability.
2009:- In the year 2009 the quick ratio is 1.65:1.
2008:- In the year 2008 the quick ratio is 1.57:1 it very bad as the company
does not has the ability to pay at least half of its quick liability
2007:- In the year 2007 the quick ratio is 1.1:1 it is also good for the
company. Company is near to ideal ratio, in this year the company has the
Capacity to pay its whole quick assets.
2006:- In the year 2009 the quick ratio is 1.47:1.
5.1.3 Net Working Capital
Net Working Capital

5,000.00
2,044.92
1,825.04
1,536.67
1,039.84
-5,052.52
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-5,000.00
-10,000.00
-9,673.55
-15,251.35
-15,000.00
-17,265.59 -16,454.32
-19,547.26
-20,000.00
-25,000.00
Interpretation:
2015:- In the year 2015 company is not utilizing its assets properly. It means
that -19547.26cr. Of its total current assets was left unused. This was the
blocked current assets of the company for year 20115. Company can invest
that in any other field and make profit.
2014:- In the year 2014-9,673.55cr of current assets are not utilized by the
company. It should be utilized by firm and make efficient use of it.
2013:- In the year 2013 -17,265.59cr current assets are not used by
company. Company can earn more profit by utilizing the same in any other
field.
2012:- In the year 2012 the -15,251.35cr of the current assets are blocked in
raw material and etc. it should not be blocked the production and selling
process should be clear and efficient. This much of current assets should not
be blocked.
2011:- In the year 2011 the -16,454.32cr assets are blocked but it is
understandable that company has maintained the capacity of paying the
total liabilities.
2010:- In the year 2010 the -5,052.52cr from the total current assets are not
used but it is some necessary to maintain the difference between total
current assets and total current liabilities.
2009:the year 2009 the2,044.92cr current assets are not used by company.
Company can earn more profit by utilizing the same in any other field.
2008: In the year 2008 the 1,039.84cr assets are blocked but it is
understandable that company has maintained the capacity of paying the
total liabilities.
2007: In the year 2007 1,825.04cr of current assets are not utilized by the
company. It should be utilized by firm and make efficient use of it.
2006: In the year 2006 the 1,536.67cr of the current assets are blocked in
raw material and etc. it should not be blocked the production and selling
process should be clear and efficient. This much of current assets should not
be blocked
5.2 Profitability Ratio:

5.2.1 Gross Profit Ratio:
Gross Profit Ratio

35.00
30.00
25.00
31.85
25.82 26.79
20.00
24.10
25.50
26.68
29.53
30.22
27.35
26.38
15.00
10.00
5.00
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Interpretation:
1. Here we calculated the gross profit ratio of the company for last ten years. There are no norms
or standard to interpret gross profit ratio. Generally a higher ratio is considered better.
2. In the year 2010 & 2007 the gross profit ratio is highest i.e., 31.85% & 30.22%. It means we
can say that company was doing very well in both the above given years.
3. A consistent improvement in gross profit ratio over the past year is the indication of
continuous improvement. In the year 2007, 2008, 2009, 2010 & 2011 it is increases. It is
beneficial for the company.
4. Than after in year 2013 it is very low i.e., only 24.10%. It should not be that much low. It
should be increase continuous.
5. In the year 2006, 2011 & 2014 it is average. It is near by 26%. It is good we can say but it
should be increase continuously. But then in year 2012, 2013 it decreases and becomes only
25.50%.
6. For this company gross profit ratio is sufficient to cover all expenses and provide profit.
5.2.2 Operating Ratio:
Operating Profit Rario
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18.00
16.00
16.67
14.00
14.75
14.61 14.59 14.24
13.64
12.00
13.23
12.32 12.63
10.00
11.19
8.00
6.00
4.00
2.00
0.00
Interpretation:
1. Operating ratio varies from industry to industry, as our company is refining company the
operating ratio should be high.
2. In the year 2010 & 2011 it is 16.67% & 14.75%. It is highest ratio of the company. It is not
good for company.
3. In the year 2006 11.19%. It is very much low. The operating profit of company in the year
2006 is very low. It shows the the cost component in the sales figure is within normal range. A
low operating ratio means high net profit ratio i.e., more operating profit.
4. In the year 2006, 2014 & 2015 the ratio is low. So we can say that it is good for the company.
It should be maintained by the company.
5. From the above data we can say that operational efficiency of management is good. It should
be maintained.
5.2.3 Net Profit:
Net Profit Ratio

14.00
12.00
12.45
10.00
11.01
8.00
6.00
4.00 5.36
7.03
7.28
8.55
7.27
7.68
7.78
5.70
2.00
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
0.00
Interpretation:
1. It measures the overall profitability of business. A high ratio indicates the efficient
management of the affairs of business. In this analysis in year 2010 net profit ratio is 12.45%. It
highest ratio of net profit in last ten years. It is very much beneficial for the company.
2. After the year 2015 the company is doing quite well compare to before 2015 it is increasing.
So it is good for the company.
3. In the year 2015 it is very much low. It should not be this much low. It says that the
profitability of the company is very low.
4. The net profit ratio is used in conjunction with the assets turnover ratio helps in ascertaining
how profitability the assets have been used during the period.
5.2.4 Rate of Return on Investment:
ROI
30.00
25.00
24.94 24.64
20.00
20.04
15.00
10.00
5.00 7.83
8.78
10.67 11.05
16.80 17.86
13.84
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
0.00
Interpretation:
1. This calculation can be altered by deducting taxes and fees to get more accurate picture of the
total ROI.
2. We can see the total investment done by the company. By analyzing the data we can say that in
year 2006 & 2007 the company has done very much good investment. Company should maintain
the same.
3. The same inputs are used to get the accurate comparison.
4. In the year 2007 the company has made lowest investment i.e., only 7.83%. It should not be
this much low.
5. To figure out net profit on investment, a company would need to track exactly how much cash
went into the project and the time spent by employees working on it
5.2.5 Rate of Return on Equity:
ROE(%)
12.06
12.88
15.48
15.95
17.78
25.96
21.03
20.90
ROE
35.00
32.80
30.00
25.00
26.15
25.96
20.00
15.00
10.00 12.06 12.88
15.48 15.95
17.78
21.03 20.90
5.00
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
0.00
Interpretation:
1. It measures how much profit company get on the investment of 1 rupee of shareholder. If there
is high ratio, we can say that company is making more profit on investment of shareholders.
2. In the year 2006 it is 26.15%. In this case preferred dividends are not included in the
calculation of because these profits are not available to common shareholders. It means the
company is doing well but it has not paid preference dividend to the shareholders.
3. In the year 2015 the company doesnt have the amount of profit to provide dividend to its
shareholders. It means that company is not getting much profit on the issue of the share.
4. In the year 2011,2012 & 2013 the company is earning little profit on the issue of 1 share of a
common shareholder. It is average for the company.
5. The company should have to earn high profit on the issue of 1 share by any shareholder.
5.2.6. Rate of Return on Capital Employed (ROCE)
32.80
ROCE
30.00
25.00
24.94 24.64
20.00
20.04
15.00
10.00
5.00 7.83
8.78
10.67 11.05
16.80 17.86
13.84
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
0.00
Interpretation:
1. It measures how much profit company get on the investment of 1 rupee of shareholder. If there
is high ratio, we can say that company is making more profit on investment of shareholders.
2. In the year 2007 it is 24.94%. In this case preferred dividends are not included in the
calculation of because these profits are not available to common shareholders. It means the
company is doing well but it has not paid preference dividend to the shareholders.
3. In the year 2015 the company doesnt have the amount of profit to provide dividend to its
shareholders. It means that company is not getting much profit on the issue of the share.
4. In the year 2008,2009 & 2010 the company is earning little profit on the issue of 1 share of a
common shareholder. It is average for the company.
5. The company should have to earn high profit on the issue of 1 share by any shareholder.
5.3 Asset Turnover Ratio:

5.3.1 Total Asset Turnover:
Total assets turnover
0.58
0.62
0.64
0.65
0.65
0.70
0.71
0.75
0.80
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
0.90
0.80
0.70
0.60
0.50 0.59
0.40
0.30
0.20
0.10
0.00
INTERPRETATION:
The total assets turnover shows the efficient use of assets that how
many times the sales are generated from the proper utilization of
assets.
In 2006 the Asset turnover was 0.80 which means that the uses of
assets are properly managed and it generated sales nearly twice.
In 2007 and 2008 again the company was utilizing or managing the
assets very well with 0.75 and 0.71 respectively. But form 2009 to
current year 2015 the average asset turnover is 0.70 which is good
but the company can still improve the utilization of assets in proper
way.
5.3.2 Net Fixed Turnover Ratio (In times):
Net fixed turnover

7.00
6.57
6.00
5.00
4.00
4.09
3.00
3.32
2.00 2.65
2.64
2.45
3.34
2.95
4.17
3.20
1.00
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
0.00
INTERPRETATION:
The Net fixed turnover shows the efficient use of net fixed assets that
how many times the sales are generated from the proper utilization of
assets..
In 2006 the Net Fixed Turnover was 6.57which mean that the uses of
assets are properly managed and it generated sales more than 5
times.
In 2007 and 2008 again the company was utilizing or managing the
assets very well with 4.17 and 4.09 respectively. But form 2009 to
2011 the utilization of assets were decreased from previous years.
Then in 2006 the Net Fixed Turnover was very high 6.57 times which
shows that the company is managing their assets very well. They
should maintain this in future too.
5.3.3Net Working Capital Turnover:
Net working capital turnover

20.00
15.00
10.00
14.40
5.00
4.12
-4.84
-2.67
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
0.00
-5.00
-8.95
-10.00
-7.98 -7.91
-6.04 -5.75
-10.86
-15.00
INTERPRETATION:
From the above chart we can see that the net working capital turnover
in previous years was high compared to the current year.
In 2006 the Net Working Capital Turnover was -5.75 times which are
very good for the company.
In 2007 it was-6.04, in 2008 it was -7.91times and then the net
working capital turnover got reduced. In 2011 the net capital turnover
ratio was -2.67 times less than the previous years.
So the company should control on their current liabilities and
increase their current assets.
5.3.4 Inventory Turnover:

Inventory turnover
7.76
8.33
9.02
5.02
4.93
M
ar
'0
6
2.92
M
ar
'0
7
3.11
M
ar
'0
8
M
ar
'0
9
M
ar
'1
0
M
ar
'1
1
2.96
M
ar
'1
2
7.68
M
ar
'1
4
M
ar
'1
3
M
ar
'1
5
10
9
8
7 7.35
6
5
4
3
2
1
0
INTERPRETATION:
Here we can see that, in year 2011 companys inventory turnover was
highest by 9.02 times, which is good for the company. It maintains its
inventory properly.
But from year 2007 to 2011 it had decreased, which shows that
company does not maintain its stock properly.
From 2011 to 2015 it was fluctuating. In 2015, it is decreased by 5.96
times as compared to previous year.
To maintain inventory turnover ratio company have to increase its
sales and thus can increase the profit.
5.3.5 Average Age of Inventories Ratio:

Inventory turnover
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
M
ar
'1
5
10.00
9.00
8.00
7.00
6.00
5.00
4.00
3.00
2.00
1.00
0.00
Average age of inventories

140
120
123.49
121.71
115.63
100
80
71.69
60
40 48.96 46.86 46.38
43.2
20
73.06
39.9
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
INTERPRETATION:
From the above graph we can say that in previous years the
inventories were hold for more than 14 days means the average age of
inventories were high.
In 2006 the inventories were kept 73 day in the warehouse while in
2007 the average age of inventories was 123.49 days which was got
good but now the company has good utilization of inventories and the
average age of inventories was less.
In 2013, 2014 and 2015 the average age of inventories were not
more than 46 day which is good for the company.
5.3.6 (A) Debtors Turnover Ratio:
Debtor's turnover
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
180
160 169.35
160.24160.52153.74
158.63
140
152.06
143.58142.96
141
120
114.68
100
80
60
40
20
0
INTERPRETATION:
The Average age of debtors turnover ratio in 2006 was 114 days.
This increased in preceding years by 158 days, 142 days, and 143 days respectively in 2007, 2008 and
2009.
The Debtors collection period should be minimized so that the company could work better.
The Same Average of turnover ratio 2013 & 2014 is 160 days.
5.4 Finance Structure Ratios:

5.4.1 Equity Ratio:
Equtiy ratio
0.70
0.60
0.58
0.50
0.40
0.30
0.20
0.32
0.31
0.37
0.40
0.46
0.45
0.39
0.45
0.49
0.10
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
0.00
Interpretation
The equity ratio is good indicator of the level of leverage used by the company. It
measures the proportion of the total assets that are financed by stakeholders, as opposed
to creditors.
A low equity ratio will produce good results for stockholder as long as the company earns
a rate of return on assets that is greater than the interest rate paid to creditors.
In this analysis we had calculated last 10 years equity ratio and we found that in the year
2006 the ratio is highest. It is good but it decreases after 2006 it should not be decreased.
The company should have to maintain the ratio. It should not be decreased.
5.4.2 Debt Ratio:
Debt Ratio
60000
50000
54229.61
4000046444.36
35911.66
30643.57
30000
20000
20457.34
16137.36
12465.25
6560.38
3109.28
1911.62
10000
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
Interpretation
Here we had calculated the debt ratio of last ten years. From that we can say that in year
2014 it is highest. But we can say that company has maintained it as there is not much
fluctuation in the debt ratio.
It measures the extent of a companys or consumers leverage. It can be interpreted as the
proportion of a companys assets that are financed by debt.
From this analysis we can say that the company is highly financed by debt in year 2014.
But it is good for the company that it has maintained its ratio.
5.4.3 Debt Equity Ratio:
Debt Equity ratio

60000
50000
54229.61
4000046444.36
35911.66
30643.57
30000
20000
20457.34
16137.36
12465.25
6560.38
3109.28
1911.62
10000
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
Interpretation
This ratio indicates how much debt a company is using to finance its assets relative to the
amount of value represented in shareholders equity.
In this analysis we had calculated the debt equity ratio for last ten years. From this data we
can say that in the year 2014 it was highest. Than it was decreased.
In the year 2006 it was very less but after 2006 it was increased gradually.
Company should have to maintain the ideal ratio of debt equity.
5.4.4 Interest Coverage Ratio:
Interest coverage Ratio

12.00
11.11
10.00
8.00
8.76
7.81
6.00
4.00 4.44
2.00
5.43
3.84
5.52
4.69
5.27
6.18
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
M
ar
'1
5
0.00
Interpretation
The interest coverage ratio is used to determine how easily a company can pay interest on
outstanding debt.
From this data we can say that in the year 2006 6.18 times company could pay its current
interest payment with its available earnings.
Other than 2006 company has good potential of interest payment in the year 2006 to 2011
but after 2011 it Increases. It should not be decreased company should maintain the ratio.
5.4.5
DSCR
DSCR
8.18
6.68
4.28
3.01
6.23
4.97
4.25
3.19
3.91
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
9.00
8.00
7.00
6.00
5.00
4.00
3.00 3.65
2.00
1.00
0.00
Interpretation
The interest dscr is used to determine how easily a company can pay interest on
outstanding debt.
From this data we can say that in the year 2014 3.01 times company could pay its current
interest payment with its available earnings.
Other than 2011 company has good potential of interest payment in the year 2014 to 2011
but it Decreases. It should not be decreased company should maintain the ratio.
5.5
Valuation Ratios:
5.5.1 Earning Per Share:
Earning Per Share (Rs)
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
100
90
80
70
60
50
40
30
20
10
0
Interpretation
This ratio measures the amount of net income earned per share of stock outstanding. In
this 10 years in the year 2006 the company has earned highest i.e., 28.59Rs. per share.
In the year 2009 company has faces loss of 50.11 Rs.on equity per share. Company
should have to earn profit on issue of equity shares.
In the year 2014 and 2015 company earned a profit on issue of equity per share but it is
not high. It should be high. Company should have to earn high profit on every number of
equity shares.
This calculation is heavily influenced on how many shares are outstanding. For those
outstanding shares we can calculate the diluted earnings per share.
5.5.2 Dividend pay- out Ratio
Dividend pay out Ratio
M
ar
'1
5
M
ar
'1
4
M
ar
'1
3
M
ar
'1
2
M
ar
'1
1
M
ar
'1
0
M
ar
'0
9
M
ar
'0
8
M
ar
'0
7
M
ar
'0
6
1
0.9
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
Interpretation
It provides an indication of how much money a company is returning to shareholders
versus how much money it is keeping on hand to reinvest in growth, pay off debt or add
to cash reserves. This later portion is known as retained earnings.
But in the year 2006, 2007, 2008,2209,2010,2011, 2012, 2013, 2014 and 2015 company
has no fund to keep it as reserves and make any kind of investment.
CHAPTER -6
RECOMMENDATION & SUGGESTIONS
Recommendation:
The conclusion of the project is to study the management of sample and testing
of sample by various instruments the labs of QA/QC department of the Himalaya drug
company dehradun.
In analytical lab we study how sample can be analyzed and tested by various
chemicals and instruments. Ones the test is passed then it will goes to instrumental lab
1(AAS).
In instruments lab 1(AAS) in this lab heavy metals and toxic metal can be
analyzed and their concentration in PPB, volume, duration time, RSD.
In this absorption wave length (as-193.7nm, Cd-228.8nm,Hg-253.7nm, pb283.3nm, cu-324.8nm).
In another instrument lab-2 (high performance thin layer chromatography) same
sample can be analyzed. This lab is also known as finger printing lab, in this lab samples
photo is taken on various uv fight like: 254nm, 366nm, and white light.
After these two lab has analyzed the sample the sample goes to microbiology lab
where fudges and coterie can be analyzed in sample and try to remove that bacteria and
fungus.
SUGGESTIONS:
L&T is 'Best for Investor Relations': Asiamoney

National 'Good Design' Award for L&T's Solar Lantern
The overall experience in THE LARSEN AND TOUBRO is excellent but someone I
feel that company need some improvement in various places in QA/QC department for
better result.
The first thing that I observe in the labs is that the instrument which is used to analyze the
samples are old. Now a days there are much better and improved technology and
instrument are coming in the market. If company give preference to that instrument and
technology then company provide better result and make healthy profit in the market.
Second thing I suggest that company has only two plants in India first in dehradun and
second is in Bangalore. Company must need more units in India to increase thare
production and make more product at a sometime.
Bibliography:
website
1. www.moneycontrol.com
2. www.ongcindia.com
3. www.en.m.wikipedia.org
Software
1. ACE
Annual Reports of LARSEN AND TOUBRO

Financial analysis of Larsen and toubro 2005-06 to 2014-15.
Books
Financial accounting
R Narayanaswamy, A managerial perspective. Prentice Hall India.429-471 pp.
Financial management
Chandra prasnna, Theory and Practice Tata Mcgraw Hill. 727-768 pp
ANNEXURES/APPENDICES:
Consolidated Balance Sheet of Larsen and Toubro
Consolidated Profit & Loss account of Larsen and Toubro

Final Analysis Report of L &amp; T

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Financial analysis

LARSEN AND TOUBRO

In partial fulfilment of the requirements for the

Limitation of the study:

Significance and need of financial analysis:

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

S.K. School of business Management,

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

I and vijay, the student of S.K. School of Business

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

CHAPTER -1. GENERAL INFORMATION

CHAPTER -2. ANALYSIS OF BALANCE SHEET

CHAPTER -3. ANALYSIS OF PROFIT &LOSS

CHAPTER -5. RATIO ANALYSIS & COMMON SIZE

CHAPTER -6. RECOMMENDATION & SUGGESTIONS

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

ANALYSIS OF BALANCE SHEET

Statement of Balance Sheet

ANALYSIS OF PROFIT & LOSS ACCOUNT

Statement of profit and loss account

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

ANALYSIS OF BALANCE SHEET

Statement of Balance Sheet

Tread Statement of Balance Sheet

Horizontal Statement of Balance Sheet

ANALYSIS OF PROFIT & LOSS

Statement of profit and loss account

Trend Statement of Profit and Loss

Debtors Turn Over Ratio

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

Coal Based Power Plants

Gas Based Power Plants

Machinery & Industrial Products company

L&T-Case Equipment Private Limited

L&T Komatsu Limited (LTK)

Tractor Engineers Limited (TENGL)

Audco India Limited (AIL)

L&T-Demag Plastics Machinery Limited

EWAC Alloys Limited

OTHER DETAILS OF COMPANY:

of offices. A thrust on international business has seen overseas earnings grow

L&T International FZE

L&T Urban Infrastructure Limited

L&T Infrastructure Finance Limited

L&T L&T Finance Limited

L Capital Company ltd. (LTCCL): Subsidiary Company

L&T Infrastructure Development Projects Ltd. (L&TIDPL): Subsidiary Company

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

BSE, NSE, London, Luxembourg, MCX

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

Construction And Maintenance Of Motorways,

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

2.2 Trend Analysis

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

S. K. SCHOOL OF BUSINESS MANAGEMENT, PATAN

Total Share Capital

Equity Share Capital

Share Application Money

Init. Contribution Settler

Employee Stock Opiton

Final Analysis Report of L & T

Final Analysis Report of L & T