A Study On Financial Performance Analysis of The Sundaram Finanace LTD

Project Report on
“A study on Financial performance analysis of

the Sundaram Finanace Ltd. ”
FOR THE PARTIAL FULFILLMENT OF DEGREE OF

BACHELOR OF BUSINESS ADMINISTARTION OF R.T.M
NAGPUR UNIVERSITY, NAGPUR.
GUIDED BY
Dr. Viraj Welturkar
SUBMITTED BY
ATUL MAJUMDAR
DEPARTMENT OF BACHELOR OF BUSINESS

ADMINISTRATION, NATWARLAL MANIKLAL DALAL
COLLEGE, GONDIA
2020-2021
CERTIFICATE
This is to certify that Atul Majumdar is a bonafied student of final year in the
department of Bachelor of Business Administration, NMD College, Gondia for
the session 2020-2021. She/He has completed her/his project work entitled.
“A study on Financial performance analysis of the Sundaram Finanace

Ltd.”
Under the guidance of Dr. Viraj Welturkar on the subject approved by the
department. This project is submitted to R.T.M. Nagpur University in the partial
fulfillment for the degree of Bachelor of Business Administration.
Principal
Sharda I. Mahajan
NMD College, Gondia

Certificate of Guide
This is to certify that Atul Majumdar of BBA final year in department of

Bachelor of Business Administration N.M.D. Gondia for the year 2020-2021
has completed his project work entitled.
“ A study on Financial performance analysis of the Sundaram Finanace

Ltd ”
Under my Guidance
 The Candidate has satisfactorily conducted research for not less than
academic year.
 This project is the result of the candidates own work and is of sufficiently
high standard to warrant its presentation to R.T.M. Nagpur University in
the partial fulfillment of requirement of the degree of Bachelor of Business
Administration .
Project Guide
Dr. Viraj Welturkar
Department of BBA,
NMD College. Gondia.
DECLARATION
I hereby declare that this project work “A study on Financial

performance analysis of the Sundaram Finanace Ltd ” is the result of my own
work under the guidance of Dr. Viraj Welturkar and the same has not been
previously submitted by me to RTM University or any other University.
(Final Year)
Department Of Bachelor of Business
Administration, NMD College, Gondia
Acknowledgement
I am using this opportunity to express my gratitude to everyone who supported

me throughout the course of BBA project work.
“A study on Financial performance analysis of the Sundaram Finanace Ltd

”
I am thankful for their aspiring guidance, invaluably constructive criticism and

friendly advice during the project work. I am sincerely grateful to them for
sharing their truthful & illuminating views on a member of issues related to the
project.
I am deeply indebted to my research guide, Dr. Viraj Welturkar for his excellent
guidance and timely correction. Without his help the report would not have taken
its present shape.
The faculty at the institute has constantly been a guiding force. I would like to
convey my special thanks to Principal, Sharda I. Mahajan
Last but not the least, I would like to specially thank the whole supporting staff
for always being with me during the making of my research report. My thanks
are extended to the librarians and the system administrators at the computer lab.
(BBA Final Year)
Department of Bachelor of
Business Administration NMD College, Gondia
Index
Sr.No Particulars Page No
1 INTRODUCTION 1
2 INDUSTRIAL PROFILE 3
3 COMPANY PROFILE 7
3 OBJECTIVES OF THE COMPANY 10
4 NEED FOR THE STUDY 13
5 OBJECTIVES OF THE STUDY 15
6 SCOPE OF THE STUDY 17
7 LITERATURE REVIEW 19
8 RESEARCH METHODOLOGY 23
9 SOURCE OF DATA 25
10 DATE ANALYSIS AND INTERPRETATION 31
11 FINDING 49
12 SUGGESTIONS 52
13 CONCLUSION 54
15 BIBLIOGRAPHY 57
1
2
“A study on Financial performance analysis of the Sundaram Finanace Ltd.”
INTRODUCTION
1
1 INTRODUCTION
The financial statement provides the basic data for financial performance analysis. The
financial statements provide a summarized view of the financial position and operations of a firm.
Financial analysis (also referred to as financial statement analysis or accounting analysis) refers to
an assessment of the viability, stability and profitability of a business. The analyst first identifies
the information relevant to the decision under consideration from the total information contained
in the financial statements. Therefore, much can be learnt about a firm from a careful examination
of its financial statements as invaluable documents and performance reports.
The analysis of financial statements is an important aid to financial analysis. They provide
information on how the firm has performed in the past and what is its current financial position.
Financial analysis is the process of identifying the financial strengths and weakness of the firm
from the available accounting data and financial statements. The analysis is done by establishing
relationship between the different items of financial statements.
The focus of financial analysis is on key figures in the financial statements and the
significant relationship that exists between them. The analysis of financial statements is a process
of evaluating relationship between component parts of financial statements to obtain a better
understanding of the firm’s position and performance.
The first task of financial analyst is to select the information relevant to the decision under
consideration from the total information contained in the financial statement. The second step
involved in financial analysis is to arrange the information in a way to highlight significant
relationships. The final step is interpretation and drawing of inferences and conclusions. In brief,
financial analysis is the process of selection, relation, and evaluation.
2
INDUSTRIAL PROFILE
3
INDUSTRIAL PROFILE
NON-BANKING FINANCIAL COMPANIES (NBFCS)
Non-bank financial companies (NBFCs) are financial institutions that provide

banking services without meeting the legal definition of a bank, i.e. one that does not hold a
banking license. Operations are, regardless of this, still exercised under bank regulation.
According to Reserve Bank Amendment of Act 1997, A Non-Banding Financial Company

(NBFCs) means,
 A financial institution which is a company

 A non-banking institution which is a company which has its principal business receiving
of deposits under any scheme of arrangement or in any other manner or lending in any
manner
The non-banking financial sector in India has tremendous growth in recent years. NBFCs’
attracted a large number of small investors since the rate of return on deposits with them was
relatively high. NBFCs are quite flexible sectors like equipment leasing, hire-purchase, housing
finance, consumer finance and so on, where gaps between the demand and supply of funds have
been high. The growth in number of NBFCs was facilitated by the case of entry, limited fixed
assets and absence of any need to hold inventories.
CURRENT SCENARIO OF NBFCS
The base of today’s feebleness of Non-Banking Finance Companies can perhaps be

traced back to early nineties. The buoyant capital market, in the first flush liberalization
welcomed every issue with huge premiums and massive over subscription. This was the signal
for several unscrupulous promoters to set up high profile finance companies and raise money
from both the capital markets and through public deposits.
The Reserve Bank of India for its past, progressively relaxed its regulatory hold over
the industry and made it possible for the companies with little financial strength and even fewer
4
scrupulous to raise large amounts of money from an unsuspecting public. Hardly anyone knew or
questioned how these moneys were deployed. Soon afterward, the stock market scam broke
claiming its first victim from the non-banking finance companies sector. With the capital market
in disarray, it was no longer possible for continue of fund flow, from investors who had burnt their
fingers in the stock markets. It was thus convenient fresh deposits. In July1996, the RBI, perhaps
the most sweeping changes in the non-banking finance companies regulation, virtually pulled out
all the stock, enabling companies to raise deposits with minimum number and more significantly,
removed the ceiling on interest rate.
At the point, when the government was faced with grim situation and responding to the
plea of the industry, the government set up a special task force headed by Mr. C.M. Vasudev to
recommend the steps for the orderly growth of finance companies while keeping investor
protection as its key priority. The committee in its final report recognized the important role played
by these companies and warned against the tendencies to tar all the companies with the same brush.
The silent recommendations of the Vasudev committee were
 Review of minimum capital requirement of Rs. 25lakhs for registration purposes

 Higher capital adequacy ratio for non-banking finance companies seeking public deposits
without credit rating
 Preview of prudential norms with ceiling for exposure to real estate and capital markets
 Differential ceiling on public deposit acceptance for companies with and without credit
ratings
 A separate instrument to regulate and supervise non-banking finance companies.
ADVANTAGE OF NBFCs
1. Lower transaction costs

2. Higher rate of interest on deposits compared to banks
3. Quick financial decision caking
4. Customer orientation
5. Prompt provision of services
5
RBI GUIDELINES FOR NBFCs
The nineties witnessed a dramatic increase in the number of NBFCs and it was thought
necessary to have a regulatory framework for NBFCs. RBI came out with set of guidelines for
NBFCs specifically aimed at protecting the depositors.
To encourage the NBFCs that is running on sound business principals, on July 24th
1996, NBFCs were divided into two classes,
i. Equipment leasing and hire purchase (finance company)

ii. Loan and investment companies
CATEGORIES OF NBFCs
i. Loan Companies
ii. Investment Companies
iii. Hire Purchase Companies
iv. Equipment Leasing Companies
v. Mutual Benefits Finance Companies
vi. Housing Finance Companies
Equipment leasing company – Any company, which is a financial institution, carrying on its
principal business. The activities of leasing of equipment of the financing of such activity.
1. Hire purchase finance company – A company, which is a financial institution, carrying on

its principal business, hire purchase transaction.
2. Investment Company – A company, which deals with acquisition of securities.
3. Loan Company – A company, which is a financial institution and carries on its principal
business of providing finance by any activities other than its own.
4. Mutual benefit finance company – A company, which is a financial institution. This is

notified by the central government under section 620 (a) of The Companies Act 1956.
6
COMPANY PROFILE
7
COMPANY PROFILE
Sundaram Finance Limited was incorporated in 1954 and has grown into one of the
most trusted financial services group in India and a part of TV Sundaram Iyengar and Sons group
of companies, one of India’s largest industrial conglomerates and diversified industrial
conglomerate with principal base in Chennai and Madurai. Almost all the companies in the group
are privately held. The company was started with a paid-up capital of Rs.2Lakhs and later
went public in 1972.
FOUNDER OF THE COMPANY
The Company was founded by Sri. T. S. Santhanam. He has a rich experience in the
automobile and road transport sector for nearly six decades. He was the founder, Director and
First managing director of Sundaram Finance Limited and has served on various committees
constituted by the Central Government and Reserve Bank of India on various aspects relating to
growth and development of the Road Transport and Non-Banking Financial Companies.
The company has been rated as ‘MAA’ by the ICRA signifying the highest number of
deposits. The Company mobilizes its funds from driver sources at competitive rates thus achieving
a reduction in overall cost of funds. The company gets its funds from the main sources namely,
 Deposits
 Bank/Industrial Finance
 Debentures
 Commercial Papers
THE MAIN ACTIVITIES OF SUNDARAM FINANCE LIMITED
 Deposits
 Hire Purchasing
 Leasing
8
FIVE PILLARS OF SUNDARAM FINANCE LIMITED
1. Faith
2. Depositor’s confidence
3. Institutional trust
4. Investor safety
5. Employee loyalty
CORPORATE PHILOSOPHY OF THE COMPANY
 Truth and fairness guide the management of finance

 Customer satisfaction through excellent service and reliability
 Prudence and conservation in finance operations
 Truth, honesty and efficiency in all dealings
 Professional management with high standards of integrity
 Full compliance with law and regulations.
9
OBJECTIVES OF THE COMPANY
10
OBJECTIVES OF THE COMPANY
Sundaram Finance was initiated with the sole objective of financing commercial vehicles
and passenger cars. Within a span of 55 years they have spread their wings to every exposable area
in the Non-banking finance sector. Sundaram Finance – Where Truth, Fairness and Transparency
guide the management of finance.
VALUES
A set of values have governed their growth over the years. Among them are transparent
in their business practices, dedicated customer service fair, efficient and safe financial policies.
STRENGTH
 Support of the group companies.

 Involvement of the directors on major policy matters.
 High employee morale.
 Good initial system for operation and control.
 Efficiency and sophisticated software system for decision support system.
 Investor’s trust and faith in the company.
 Easy financing schemes for all cars – new and second hand cars.
 Simple documentation, quick processing and speedy approval.
 Customized schemes, personalized service.
 Direct dealing between customer and company.
 No hidden costs.
 Tailor – made products to suit individual requirements.
SUBSIDARIES / GROUPS
 Sundaram Finance
 Sundaram BNP Paribas Asset Management
 Sundaram BNP Paribas Home Finance Limited
 Royal Sundaram Alliance Insurance
 Sundaram InfoTech Solutions
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 Sundaram Business Services

 Sundaram Finance Distribution Limited
 Infrieght Logistics Solutions Limited
AWARDS RECEIVED
 ‘Certificate of Commendation’ award by the Government of India under the scheme of

“Good Tax Payers”.
 “Second Best Tax Payer” in the category of Private Sector Company for Assessment
Year 1994-95 in Tamil Nadu Region, from the Income Tax Department, Tamil Nadu.
 ‘Rolling Trophy’ by Rotary Club of Madras South West for Best Employer-Employee
Relationship for the year 1995-96.
 “Best Tax Payer” in the category of Private Sector Company for Assessment Year 1995-
96 in Tamil Nadu Region, from the Income Tax Department, Tamil Nadu.
 “Automan Award” to Shri T S Santhanam, Chairman, from Motor India in 1998.
 “Pioneering Service Award” to Shri T S Santhanam Chairman, from Chennai Good

Transport Association.
 “Sarige Ratna Award” to Shri T S Santhanam, Chairman, from the Bangalore City
Lorry Transporting Agents’ Association (Regd).
 “Most Valued Customer Award” to Shri T S Santhanam Chairman, from the State
Bank of India.
 “The Best Financier of the New Millennium 2000” to Shri. G K Raman, Managing
Director, from the All India Motor Transport Congress.
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NEED FOR THE STUDY
13
NEED FOR THE STUDY
The Financial Statements are mirror which reflects the financial position and strengths or
weakness of the concern. The Non- Banking Financial Company has been witnessed intense
competition from domestic banks and international banks. Every business needs to view the
financial performance analysis.
The study on effectiveness of operational and financial performance of Sundaram finance

limited is conducted to measure the overall performance of company. The financial analysis
strengths the firms to make their best use, and to be able to spot out financial weakness of the firm
to state suitable corrective actions.
This study aims at analyzing the overall financial performance of the company by using
various financial tools like Comparative Analysis, common size statement analysis, Ratio
Analysis, and Cash Flow Analysis.
14
OBJECTIVES OF THE STUDY
15
OBJECTIVES OF THE STUDY
PRIMARY OBJECTIVE:
o To study the financial performance analysis of Sundaram Finance Limited, Chennai.
SECONDARY OBJECTIVES:
o To compare and analyze the financial statements for the past three financial years
(2008,2009 and 2010)
o To know the profitability, liquidity and solvency position of Sundaram finance

limited.
o To compare and interpret financial statements of the Sundaram Finance Limited

with comparative and common-size statement analysis.
o To forecast the annual growth rate of income of the company with the help of
regression analysis.
o To provide suggestions for improving the overall finance performance of the

company.
16
SCOPE OF THE STUDY
17
SCOPE OF THE STUDY
The study is based on the accounting information of the SUNDARAM FINANCE

LIMITED, CHENNAI. The study covers the period of 2008-2010 for analyzing the financial
statement such as income statements and balance sheet.
The scope of the study involves the various factors that affect the financial efficiency
of the company. To increase the profit and sales growth of the company. This study finds out the
operational efficiency of the organization and allocation of resources to improve the efficiency of
the organization.
The data of the past three years are taken into account for the study. The performance is
compared within those periods. This study finds out the areas where Sundaram Finance Ltd can
improve to increase the efficiency of its assets and funds employed.
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LITERATURE REVIEW
19
LITERATURE REVIEW
REVIEW OF LITERATURE
Literature Review was done by referring previous studies, articles and books to know
the areas of study and analyze the gap or study not done so far. There are various studies were
conducted relating to operational performance of the company from which most relevant
literatures were reviewed.
Kennedy and Muller (1999), has explained that “The analysis and interpretation of financial
statements are an attempt to determine the significance and meaning of financial statements data
so that the forecast may be made of the prospects for future earnings, ability to pay interest and
debt maturines (both current and long term) and profitability and sound dividend policy.”
T.S.Reddy and Y. Hari Prasad Reddy (2009), have stated that “The statement disclosing status
of investments is known as balance sheet and the statement showing the result is known as profit
and loss account”
Peeler J. Patsula (2006), he define that a sound business analysis tells others a lot about good
sense and understanding of the difficulties that a company will face. We have to make sure that
people know exactly how we arrived to the final financial positions. We have to show the
calculation but we have to avoid anything that is too mathematical. A business performance
analysis indicates the further growth and the expansion. It gives a physiological advantage to the
employees and also a planning advantage.
I.M.Pandey (2007), had stated that the financial statements contain information about the financial
consequences and sources and uses of financial resources, one should be able to say whether the
financial condition of a firm is good or bad; whether it is improving or deteriorating. One can relate
the financial variables given in financial statements in a meaningful way which will suggest the
actions which one may have to initiate to improve the firm’s financial condition.
Chidambaram Rameshkumar & Dr. N. Anbumani (2006), he argue that Ratio Analysis enables
the business owner/manager to spot trends in a business and to compare its performance and
20
condition with the average performance of similar businesses in the same industry.
To do this compare your ratios with the average of businesses similar to yours and compare your
own ratios for several successive years, watching especially for any unfavorable trends that may
be starting. Ratio analysis may provide the all-important early warning indications that allow you
to solve your business problems before your business is destroyed by them.
Jae K.Shim & Joel G.Siegel (1999), had explained that the financial statement of an enterprise
present the raw data of its assets, liabilities and equities in the balance sheet and its revenue and
expenses in the income statement. Without subjecting these to data analysis, many fallacious
conclusions might be drawn concerning the financial condition of the enterprise. Financial
statement analysis is undertaken by creditors, investors and other financial statement users in order
to determine the credit worthiness and earning potential of an entity.
Susan Ward (2008), emphasis that financial analysis using ratios between key values help
investors cope with the massive amount of numbers in company financial statements. For example,
they can compute the percentage of net profit a company is generating on the funds it has deployed.
All other things remaining the same, a company that earns a higher percentage of profit compared
to other companies is a better investment option.
M Y Khan & P K Jain (2011), have explained that the Financial statements provide a summarized
view of the financial position and operations of a firm. Therefore, much can be learnt about a firm
from a careful examination of its financial statements as invaluable documents / performance
reports. The analysis of financial statements is, thus, an important aid to financial analysis.
Elizabeth Duncan and Elliott (2004), had stated that the paper in the title of efficiency, customer
service and financing performance among Australian financial institutions showed that all
financial performance measures as interest margin, return on assets, and capital adequacy are
positively correlated with customer service quality scores.
Jonas Elmerraji (2005), tries to say that ratios can be an invaluable tool for making an investment
decision. Even so, many new investors would rather leave their decisions to fate than try to deal
with the intimidation of financial ratios. The truth is that ratios aren't that intimidating, even if you
21
don't have a degree in business or finance. Using ratios to make informed decisions about an
investment makes a lot of sense, once you know how use them.
Carlos Correia (2007), had explained that any analysis of the firm, whether by management,
investors, or other interested parties, must include an examination of the company’s financial data.
The most obvious and readily available source of this information is the firm’s annual report. The
financial statements shall, in conformity with generally accepted accounting practice, fairly present
the state of the affairs of the company and the results of operations for the financial year.
Greninger et al.(1996), identified and refined financial ratios using a Delphi study in the areas of
liquidity, savings, asset allocation, inflation protection, tax burden, housing expenses and,
insolvency. Based on the Delphi findings, they proposed a profile of financial well-being for the
typical family and individual.
Rachchh Minaxi A (2011), have suggested that the financial statement analysis involves
analyzing the financial statements to extract information that can facilitate decision making. It is
the process of evaluating the relationship between component parts of the financial statements to
obtain a better understanding of an entity’s position and performance.
Salmi, T. and T. Martikainen (1994), in his "A review of the theoretical and empirical basis of
financial ratio analysis", has suggested that A systematic framework of financial statement analysis
along with the observed separate research trends might be useful for furthering the development
of research. If the research results in financial ratio analysis are to be useful for the decision
makers, the results must be theoretically consistent and empirically generalizable.
John J.Wild, K.R.Subramanyam & Robert F.Halsey (2006), have said that the financial
statement analysis is the application of analytical tools and techniques to general-purpose financial
statements and related data to derive estimates and inferences useful in business analysis. Financial
statement analysis reduces reliance on hunches, guesses, and intuition for business decisions. It
decreases the uncertainty of business analysis
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RESEARCH METHODOLOGY
23
RESEARCH METHODOLOGY
Research can be defined as “A Scientific and Systemic Search for pertinent information
on a specific topic”. Therefore, research could be understood as an organized activity with specific
objectives on a problem or issues supported by compilation of related data and facts, involving
application of relevant tools of analysis and deriving logically on originality.
RESEARCH DESIGN
Research Design is the arrangement of condition for collection and analysis of data in
manner that aims to combine relevance to the research purpose with the economy in procedure.
Research Design is important primarily because of the increased complexity in the market as well
as marketing approaches available to the researchers. A research design specifies the methods and
procedures for conducting a particular study.
TYPE OF RESEARCH
ANALYTICAL RESEARCH
In this type of research has to use facts or information already available, and analyze
these to make a critical evaluation of the material. The researcher depends on existing data for
his research work. The analysis revolves round the material collected or available.
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SOURCE OF DATA
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SOURCE OF DATA
 SECONDARY DATA
Secondary Data refers to the information or facts already collected such data are collected with the
objectives of understanding the past status of any variable or the data collected and reported by
some source is accessed and used for the objective of a study. Normally in research, the scholars
collect published data, journals, annual reports and websites.
TOOLS USED FOR ANALYSIS
(1) Ratio Analysis
(2) Comparative Statement Analysis
(3) Common-size Statement Analysis
(4) Cash Flow Statement Analysis
(5) Regression Analysis
RATIO ANALYSIS
A ratio is the process of determining and presenting the relationship of items and groups of items
in the financial statements. The ratios can be classified into the following types:
PROFITABILITY RATIO
Profitability Ratio measured as a ability to make maximum profit from optimum utilization of
resources by a business concern is termed as profitability.
o GROSS PROFIT RATIO
This ratio is also known as Gross Margin or Trading Margin Ratio. Gross Profit Ratio includes the
difference between sales and direct costs.
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Gross Profit Ratio = ( Gross Profit / Net Sales ) * 100
o NET PROFIT RATIO
It measures of management efficiency in operating the business successfully from the owner’s
point of view. Higher the ratio better is the operational efficiency of business concern.
Net Profit Ratio = ( Net Profit After Tax / Net Sales ) * 100
o RETURN ON EQUITY OR RETURN ON NET WORTH
This ratio signifies the return on equity shareholders funds. The profit considered for computing
the ratio is taken after payment of preference dividend.
Return on Equity = ( Net Profit After Interest And Tax / Shareholder’s funds ) * 100
ACTIVITY RATIO OR TURNOVER RATIOS:
Activity ratios highlight the operational efficiency of the business concern. The term operational
efficiency refers to effective, profitable and rational use of resources available to the concern.
o WORKING CAPITAL TURNOVER RATIO
Working capital ratio measures the effective utilization of working capital. It also measures the
smooth running of business. The ratio establishes relationship between cost of sales and working
capital.
Working Capital Turnover Ratio = ( Sales / Net Working Capital )
o CAPITAL TURNOVER RATIO
Managerial efficiency is also calculated by establishing the relationship between cost of sales or
sales with the amount of capital invested in the business.
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Capital Turnover Ratio = (Sales / Capital Employed)
o FIXED ASSET TURNOVER RATIO

This ratio determines efficiency of utilization of fixed assets and profitability of a business
concern.
Fixed Asset Turnover Ratio = (Sales / Net Fixed asset)
SOLVENCY OR FINANCIAL RATIOS
Solvency or Financial Ratios include all ratios which express financial position of the concern.
The term financial position generally refers to short-tem and long-term solvency of the business
concern, including safety of different interested parties.
o CURRENT RATIO
In order to measure the short-term liquidity or solvency of a concern, comparison of current assets
and current liabilities is inevitable. Current ratio indicates the ability of a concern to meet its
current obligations as and when they are due for payment.
Current Ratio = ( Current asset / Current liabilities )
o DEBT EQUITY RATIO
The debt equity ratio is determined to ascertain the soundness of the long term financial policies
of the company and also to measures the relatives’ proposition of outsider’s funds and shareholders
funds investments in the company.
Debt-Equity Ratio = ( Total Long-term Debt / Shareholder’s Funds )
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o DEBT TO TOTAL FUNDS RATIO
This ratio gives same indication as the debt equity ratio as this is a variation of debt equity ratio.
This ratio is the relationship between long term debts and total long term funds.
Debt to Total Funds Ratio = ( Long-term Debt / Total Funds)
o EQUITY TO TOTAL FUNDS
Equity to total funds explains the relationship between equity and total funds.
Equity to Total Funds = ( Equity / Total Funds)
COMPARATIVE STATEMENT ANALYSIS
Comparative balance sheet as on two or more different dates can be used for comparing
assets and liabilities and findings out any increase or decrease in the items. Thus while in single
balance sheet the emphasis is on present position, it is on change in the comparative balance sheet.
COMMON SIZE STATEMENT ANALYSIS
Common size statements indicate the relationship of various items with some common
items. In the income statements, the sales figure is taken as basis and all other figures are expressed
as percentage of sales. Similarly, in the balance sheet the total assets and liabilities is taken as base
and all other figures are expressed as percentage of this total.
CASH FLOW STATEMENT
Cash flow includes cash inflows and out flows - cash receipts and cash payments during a
period. A cash flow statement is a statement which portrays the changes in the position between
two accounting period. Cash flow analysis can reveal the causes for even highly profitable firms
experiencing acute cash shortages.
REGRESSION ANALYSIS
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A fundamental and versatile research technique that seeks to explain an outcome variable
in terms of multiple predictor variables. This analysis reveals the nature and strength of the
relationship between each predictor variable and the outcome, independent of the influence from
all other predictors.
Regression Equation Y on X is given as:
Y = a + bX
Equations to find constants ‘a’ and ‘b’ are given as:
∑Y = Na + b∑X
∑XY = a∑X + b
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DATA ANALYSIS AND INTERPRETATION
31
RATIO ANALYSIS
PROFITABILITY RATIOS
Gross Profit Ratio:
This ratio is also known as Gross Margin or Trading Margin Ratio. Gross Profit Ratio
includes the difference between sales and direct costs.
Gross Profit
Gross Profit Ratio = X100
Net Sales
Table No 5.1.1 GROSS PROFIT RATIO
Years Gross Profit Net sales Ratio

(Rs.) (Rs.) (In %)
2007-2008 30289.71 90176.44 33.58
2008-2009 21971.03 108277.62 20.29
2009-2010 32347.63 118189.37 27.37
Chart No 5.1.1 GROSS PROFIT RATIO
40
PERCENTAGE)
30
RATIO (IN
20
10
0
2007-2008 2008-2009 2009-2010
YEARS
INFERENCES:
The Gross Profit for the financial year 2007-2008 was recorded as per the ratio is
33.58%, where as the years between 2008-2009 went through a change in the ratio of 20.29%
and the companies profit went upward in 2009-2010 with the ratio of 27.37%. Thus, it is
showing the steady growth in the company profile.
32
NET PROFIT RATIO
It measures of management efficiency in operating the business successfully from the

owner’s point of view. It indicates the return on shareholder’s investment. Higher the ratio better
is the operational efficiency of business concern.
Net Profit after Tax

Net Profit Ratio = X 100
Net Sales
Table No 5.1.2 NET PROFIT RATIO
Years Net Profit Net sales Ratio

(Rs.) (Rs.) (In %)
2007-2008 21254.24 90176.44 23.56
2008-2009 15073.14 108277.62 13.92
2009-2010 22674.86 118189.37 19.18
Chart No 5.1.2 NET PROFIT RATIO
25
20
PERCENTAGE)
RATIO (IN
15
10
5
0
2007-2008 2008-2009 2009-2010
YEARS
INFERENCES:
The Net Profit Ratio depicts that the company had a good profit in 2007-2008 where it had
a good yield profit. Comparing to the year 2008-2009 is 13.92%, the sales of the company have a
steady attitude and increase upwards to 19.18%. This indicates that there is an improvement in the
operational efficient of the business and it leads to the increase in the profitability of the firm.
33
RETURN ON EQUITY OR RETURN ON NET WORTH
This ratio signifies the return on equity shareholders funds. The profit considered for computing
the ratio is taken after payment of preference dividend.
Net profit after interest and tax

Return on Equity = X 100
Shareholder fund
Table No 5.1.3 RETURN ON EQUITY
Years Net profit after Shareholder Ratio

interest and tax Fund (Rs.) (In %)
(Rs.)
2007-2008 21254.24 231280.81 9.18
2008-2009 15073.14 268538.97 5.61
2009-2010 22674.86 333318.07 6.80
Chart No 5.1.3 RETURN ON EQUITY
10
PERCENTAGE)
8
RATIO (IN
6
4
2
0
2007-2008 2008-2009 2009-2010
YEARS
INFERENCES:
Return on shareholder fund determines the profitability from the shareholders point of view.
From the above, it shows that in the year 2008-2009, the company shows 5.61% of ratio and it has
risen to 6.80%. This is a clear indication of overall operation is efficient.
34
TURNOVER RATIO
WORKING CAPITAL TURNOVER RATIO
Working capital ratio measures the effective utilization of working capital. It also
measures the smooth running of business. The ratio establishes relationship between cost of sales
and working capital.
Sales
Working Capital Turnover Ratio =
Net Working Capital
Table No 5.1.4 WORKING CAPITAL TURNOVER RATIO
Years Sales Net Working Capital Ratio

(Rs.) (Rs.) (In Times)
2007-2008 90176.44 645733.44 0.13
2008-2009 108277.62 666319.18 0.16
2009-2010 118189.37 898497.54 0.13
Chart No 5.1.4 WORKING CAPITAL TURNOVER RATIO
0.2
RATIO (IN TIMES)
0.15
0.1
0.05
0
2007-2008 2008-2009 2009-2010
YEARS
INFERENCES:
A higher ratio is the indication of lower investment of working capital and more profit. In
2007-2008, the sales of the company are low at 0.13 times but in the year 2008-2009, it gone
upward of sales to 0.16 times.
35
CAPITAL TURNOVER RATIO
Managerial efficiency is also calculated by establishing the relationship between cost

of sales or sales with the amount of capital invested in the business.
Sales
Capital Turnover Ratio =
Capital Employed
Table No 5.1.5 CAPITAL TURNOVER RATIO
Years Net Sales Capital Employed Ratio

2007-2008 90176.44 536009.27 0.16
2008-2009 108277.62 533288.26 0.20
2009-2010 118189.37 720052.92 0.17
Chart No 5.1.5 CAPITAL TURNOVER RATIO
0.25
RATIO (IN TIMES)
0.2
0.15
0.1
0.05
0
2007-2008 2008-2009 2009-2010
YEARS
INFERENCES:
In the year 2007-2008, the sales’ comparing to 2008-2009 it is increased to 0.20 times and
it shows that efficient methods are adopted to use the capital employed. In 2009-2010, which
compares to the year 2007-2008 it indicates higher ratio of 0.17 times. The capital of the company
has utilized efficiently comparing to 2007-2008.
36
FIXED ASSET TURNOVER RATIO
This ratio determines efficiency of utilization of fixed assets and profitability of a

business concern.
Sales
Fixed Asset Turnover Ratio =
Net Fixed asset
Table No 5.1.6 FIXED ASSET TURNOVER RATIO
Years Sales Fixed Asset Ratio

2007-2008 90176.44 17264.30 5.22

2008-2009 108277.62 20241.05 5.35
2009-2010 118189.37 23237.80 5.09
Chart No 5.1.6 FIXED ASSET TURNOVER RATIO
5.4
5.35
RATIO (IN TIMES)
5.3
5.25
5.2
5.15
5.1
5.05
5
4.95
2007-2008 2008-2009 2009-2010
YEARS
INFERENCES:
Higher the ratio is more than the efficiency in utilization of Fixed Assets. Lower ratio
indicates the under utilization of fixed assets. From the above table it indicates in the year 2008-
2009, the sales have been increased comparing to the next year 2009-2010. And it’s gradually
declining over the next year 2009-2010 for 5.09 times.
37
SOLVENCY OR FINANCIAL RATIOS:
CURRENT RATIO
In order to measure the short-term liquidity or solvency of a concern, comparison of
current assets and current liabilities is inevitable. Current ratio indicates the ability of a concern to
meet its current obligations as and when they are due for payment.
Current asset
Current Ratio =
Current liabilities
Table No 5.1.7 CURRENT RATIO

Years Current Asset Current Liabilities Ratio
2007-2008 56187.53 53034.57 1.06
2008-2009 68876.04 50360.94 1.36
2009-2010 166489.36 55084.13 3.02
Chart No 5.1.7 CURRENT RATIO
3.5
RATIO (IN TIMES)
3
2.5
2
1.5
1
0.5
0
2007-2008 2008-2009 2009-2010
YEARS
INFERENCES:
A high current ratio is an assurance that the firm will have adequate funds to pays
current liabilities and other payment. During the year 2009-2010, the current ratio is 3.02 times
and it is more when compared with previous year 2008-2009 is 1.36 times.
38
DEBT EQUITY RATIO

The debt equity ratio is determined to ascertain the soundness of the long term financial
policies of the company and also to measures the relatives’ proposition of outsider’s funds and
shareholders funds investments in the company.
Total Long-term debt

Debt Equity Ratio =
Shareholders Funds
Table No 5.1.8 DEBT EQUITY RATIO
Years Long term debts Shareholders funds Ratio

2007-2008 431716.93 104292.34 4.13

2008-2009 418021.26 115267 3.62
2009-2010 588417.27 131635.65 4.47
Chart No 5.1.8 DEBT EQUITY RATIO
5
RATIO (IN TIMES)
4
3
2
1
0
2007-2008 2008-2009 2009-2010
YEARS
INFERENCES:
From the above table, during the year 2007-2008 the debt equity ratio is 4.13 times and it is
decreased to 3.62 times then it shows the uptrend from the year 2009-2010 as 4.47 times. Suggest
that the debt from the company has increased over the years with increase in shareholder funds as
well.
39
DEBT TO TOTAL FUNDS RATIO
This ratio gives same indication as the debt equity ratio as this is a variation of debt
equity ratio. This ratio is also known as solvency ratio. This ratio is the relationship between long
term debts and total long term funds.
Long Term Debts

Debt to Total Funds Ratio =
Total Funds
Table No 5.1.9 DEBT TO TOTAL FUNDS RATIO
Years Long Term Debts Total Funds Ratio

2007-2008 431716.93 712389.16 0.60
2008-2009 418021.26 742843.84 0.56
2009-2010 588417.27 981013.79 0.59
Chart No 5.1.9 DEBT TO TOTAL FUNDS RATIO
0.61
RATIO (IN TIMES)
0.6
0.59
0.58
0.57
0.56
0.55
0.54
2007-2008 2008-2009 2009-2010
YEARS
INFERENCES:
During the year 2007-2008, the debt to total funds ratio is 0.60 times and it was decreased.
And in 2009-2010 again it had an increase in the company’s sales comparing to previous year
2008-2009 is 0.56 times to 0.59 times in 2009-2010.
40
EQUITY TO TOTAL FUNDS
Equity to total funds explains the relationship between equity and total funds.
Equity
Equity to Total Funds =
Total Funds
Table No 5.1.10 EQUITY TO TOTAL FUNDS
Years Equity Total Funds Ratio

(In Rs.) (In Rs.) (In Times)
2007-2008 104292.34 712389.16 0.14
2008-2009 115267.00 742843.84 0.15
2009-2010 131635.65 981013.79 0.13
Chart No 5.1.10 EQUITY TO TOTAL FUNDS
0.155
RATIO (IN TIMES)
0.15
0.145
0.14
0.135
0.13
0.125
0.12
2007-2008 2008-2009 2009-2010
YEARS
INFERENCES:
In the year 2007-2008, the total funds was Rs.712389.16 (in lakhs) and it shows
upward trend of Rs.981013.79 (in lakhs) and during the year 2009-2010 comparing to the year
2008-2009 is Rs.742843.84 (in lakhs).
41
COMPARATIVE INCOME STATEMENT OF SUNDARAM FINANCE LIMITED FOR

THE YEAR ENDED 31.03.2010
Particulars 2009 2010 Amount Increase / Percentage

(Rs.) (Rs.) Decrease during Increase / Decrease
2009-2010 (Rs.) during
2009-2010 (In %)
Income from Operation 108277.62 118189.37 +9911.75 +9.15

Less: Financial Expense 64544.09 63379.55 (1164.54) (1.80)
Gross Profit (A) 43733.53 54809.82 +11076.29 +25.33
Other Income:
Profit on Sale of Shares - 2538.90 - -
Other Income 3199.28 4142.57 +943.29 +29.48
Total (B) 3199.28 6681.47 +3482.19 +108.84
Total Income 46932.81 61491.29 14558.48 +134.17

(A+B) = C
Expense:
Operating Expense:
Administration Expense 7160.91 6042.27 (1118.64) (15.62)

Establishment Expense 9407.97 10011.23 +603.26 +6.41
Provision 4616.80 8608.59 +3991.79 +86.46
Depreciation 3776.10 4481.57 +705.47 +18.68
Total Operating
Expense (D) 24961.78 29143.66 +4181.88 +16.75
Operating Profit 21971.03 32347.63 +10376.6 +47.23

(C-D)
Non-Operating Expense:
Taxation 6897.89 9672.77 +2774.88 +40.23
Total Non-Operating
Expense (F) 6897.89 9672.77 +2774.88 +40.23
Net Profit (E-F) 15073.14 22674.86 +7601.72 +50.43
42
INFERENCES:
The comparative income statement shows income from operation amount increase during
the year 2009-2010 was Rs.9911.75 and increase in percentage of 9.15.
For the year 2009-2010, the total income indicates Rs.14558.48 and percentage increase
during the year 2009-2010 was 134.17.
The operating profit has been increased is Rs.32347.63 in the year 2010 which is comparing
to the previous year was Rs.21971.03 and the percentage shows increase by 47.23.
The Net profit amount increases during 2009-2010 is Rs. 7601.72 and shows percentage
increase by 50.43.
43
COMPARATIVE BALANCE SHEET OF SUNDARAM FINANCE LIMITED FOR THE

YEAR ENDED 31.03.2010
Amount Increase / Percentage

2009 2010 Decrease during Increase /
Particulars
(Rs.) (Rs.) 2009-2010 Decrease during
(Rs.) 2009-2010 (In %)
Assets:
Current Assets 68876.04 166489.36 +97613.32 +141.72

Loans & Advance 653955.77 799363.96 +145408.19 +21.98
Deferred Tax Asset 5691.36 6124.40 +433.04 +7.61
Investment 51188.87 53744.80 +2555.93 +4.99
Fixed Asset 20241.05 23237.80 +2996.75 +14.80
Total Asset 799953.09 1048960.32 +249007.23 +31.13
Liabilities and
Capital:
Current Liability 58478.77 67946.53 +9467.76 +16.19

Unsecured Loan 208479.20 260960.87 +52481.67 +25.17
Secured Loan 417728.12 588417.27 +170689.15 +40.86
Total Liabilities 684686.09 917324.67 +232638.58 +33.98

(A)
Capital and
Reserve:
Share Capital 5555.19 5555.19 - -

Reserve & Stock
Options 109711.81 126080.46 +16368.65 +14.92
Total
Shareholders 115267.00 131635.65 16368.65 +14.20
Funds (B)
Total Liabilities 799953.09 1048960.32 249007.23 +31.13

and Capital (A+B) ========== ========== ============= =============
44
INFERENCES:
In the year 2009-2010, the investment it shows the uptrend for the year 2010 as Rs.53744.80
and it has increased by 4.99%.
Fixed assets has been increased was Rs.23237.80 in the year 2010 which is comparing to
the previous year and the percentage shows increase by 14.80.
During the year 2009, the shareholders fund amount to Rs.115267.00 it has been increased
to the amount of Rs. 131635.65 and percentage increased was 14.20.
Secured loans shows uptrend by Rs.588417.27 over the previous year of Rs.417728.12 and
increase in percentage of 33.98.
45
5.3.1 COMMON SIZE INCOME STATEMENT OF SUNDARAM FINANCE LIMITED

FOR THE YEAR ENDED 31.03.2009
2008 2009
Particulars
Amount Percentage Amount Percentage
(Rs.) (%) (Rs.) (%)
Income from Operation 90176.44 100 108277.62 100

Less: Financial Expense 49699.52 55.1 64544.09 59.6
Gross Profit (A) 40476.92 43733.53

44.88 40.39
Other Income:
- - - -
Profit on Sale of Shares
3199.28 3199.28 2.95
Other Income 3.54
Total (B) 3199.28 3.54 3199.28 2.95
Total Income 43676.20 48.43 46932.81 43.34

(A+B) = C
Expense:
Operating Expense:
7198.81 7160.91 6.61

Administration Expense 7.98
8821.90 9407.97 8.68
Establishment Expense 9.78
3308.02 4616.80 4.26
Provision 3.66
3012.19 3776.10 3.48
Depreciation 3.34
Total Operating 22340.92 24.77 24961.78 23.05

Expense (D)
Operating Profit 20.29

21335.28 23.65 21971.03
(C-D) = E
Non-Operating Expense:
Taxation 9035.47 10.01 6897.89 6.37
Total Non-Operating
9035.47 10.01 6897.89
Expense (F) 6.37
12299.81 13.63 15073.14 13.92

Net Profit (E-F)
46
INFERENCES:
The operating profit of the Sundaram Finance Limited has been increased during the year
2008-2009, the operating profit shows Rs.21335.28 in 2008 and Rs.21971.03 in the financial year
2009.
For the year 2008, the establishment expense shows Rs.8821.90 and it has been increased
to Rs.9408.97 during the year 2009.
In 2008, provision is 3.66% and it indicates increase during the year 2009 was 4.26%.
The operating expenses incurred to the Sundaram Finance Limited during the financial
year 2008 which shows Rs.22340.92 and it has risen to Rs.24961.78 during the financial year
2009.
The net profit percentage recorded as 13.63 in 2008 where as in the year 2009 the
companies profit went upward with the percentage of 13.92.
47
COMMON SIZE BALANCE SHEET OF SUNDARAM FINANCE LIMITED FOR THE

YEAR ENDED 31.03.2009
2008 2009
Particulars
Amount Percentage Amount Percentage
(Rs.) (%) (Rs.) (%)
Assets:
Current Assets 56187.53 7.24 68876.04 8.61

Loans & Advance 652655.00 84.10 653955.77 81.74
Deferred Tax Asset 4263.67 0.54 5691.36 0.71
Investment 45645.50 5.88 51188.87 6.39
Fixed Asset 17264.30 2.22 20241.05 2.53
Total Asset 776016.00 100 799953.09 100

=========== =============
Liabilities and
Capital:
Current Liability 63626.84 8.19 58478.77 7.31

Unsecured Loan 176379.89 22.72 208479.20 26.06
Secured Loan 431716.93 55.63 417728.12 52.21
Total Liability (A) 671723.66 86.56 684686.09 85.59
Capital and Reserve:
Share Capital 2777.60 0.35 5555.19 0.69

Reserve & Stock
Options 101514.74 13.08 109711.81 13.71
Total Shareholders 104292.34 13.43 115267.00 14.40

Funds (B)
Total Liabilities and

776016.00 100 799953.09 100
Capital (A+B) ===========
========== ============ =============
48
FINIDNGS
49
FINIDNGS
 The Gross Profit Ratio shows that increasing in sales has maintained the companies profit
level. In the year 2008-2009, the percentage shows 20.29 it has been increased during the
year 2009-2010 to 27.37.
 The net profit ratio has been increased to 19.18 during the financial year 2009 – 2010 to
13.92 during 2008 – 2009 which indicates that there is an improvement in the operational
efficient of the business and it leads to the increase in the profitability of the firm.
 It has found that the return on equity during the year 2008-2009, the company shows 5.61%
of ratio and it has risen to 6.80%. This is a clear indication of overall operation is efficient.
 The Working capital in the year 2008-2009, the sales of the company is low at
Rs.666319.18 and it is increased to Rs.898497.54 in 2009-2010. It measures the effective
utilization of working capital.
 The capital turnover of capital employed in the financial year 2008-2009 it shows
Rs.533288.26 and during the year 2009-2010 it is increased to Rs.720052.92. It has
effective utilization of capital employed under the current year.
 Fixed asset turnover shows increase in sales of Rs.118189.37 comparing to the previous
year of Rs. 108277.62 and the firm should maintain this increasing trend in future also.
 During the year 2009-2010, the current ratio is 3.02% and it is more when compared with
previous year 2008-2009 is 1.36 %. So the short term liquidity of a concern, comparison
of current assets and current liabilities is inevitable.
50
 The debt equity ratio has shows 3.62% in 2008-2009 and it has been raised to 4.47% during
2009-2010 which indicates that the company has increased over the years with increase in
shareholder funds as well.
 It is found that the shareholders funds had increased by Rs.16368.65 over the percentage
of 14.20 in comparative income statement analysis. It determines the profitability from the
shareholders point of view.
 The financial year 2009-2010 depicts the Net Cash from financing activities amount of
Rs.217819.49 shows upward profit in the company.
51
SUGGESTIONS
52
SUGGESTIONS
The current ratio is improving rapidly so the company wants to keep an eye on the
current assets flow. The company has been suggested to reduce the expenditure as it increases
every year. Decrease in expenses will increase the profitability.
By over viewing the working capital turnover ratio it is clear that the company
wants to utilize its working capital efficiently that is the excess current assets should be adjusted
according to current scenario. Though the net profit shows it is increased but we found that the net
profit ratio has been decreased. So the company should consider increasing the sales in turn to
increase the actual profit.
The debt equity ratio of the company is also increasing. The company should focus
on the debt and long term funds which are utilized in the company. The excess cash flow should
or can be utilized in any new ventures if the company wishes to do.
53
CONCLUSION
54
CONCLUSION
In the study of Financial Performance of Sundaram Finance Limited Chennai, it is clear

that the company’s financial performance is satisfactory. The company has stable growth and it
shows a greater efficiency in all the areas it works.
If the company utilizes its working capital then the company can go heights which it wanted
to achieve. The comparative income statement shows increase in the current year of net profit and
it depict the companies current profit position. To improve the efficiency the company will strive
for better performance and increase the market share the company.
The suggestions provided through the study will help the company to improve the
operational performance efficiently. The suggestions provided through the study will help the
company to improve the operational performance efficiently.
55
REFERENCES
56
BIBLIOGRAPHY
57
BIBLIOGRAPHY
 Carlos Correia, David Flynn, Enrico Uliana & Michael Wormald, “Financial
Management”, 6th Edition, 5.1 -5.34.
 Chidambaram Rameshkumar, Anbumani N, “An overview on financial statements and

ratio analysis”,2006, Vol.1, p. 30
 George Foster, “Financial Statement Analysis”, 2nd Edition, 57 – 94.
 Greninger et al.(1996), Fundamentals of Financial Management, 5th Edition, 4.1-4.18.
 Jae K.Shim, Joel G.Siegel, Schaum’s Outline of Theory and Problems of Financial
Accounting, 1999, 279-298.
 John J.Wild, K.R.Subramanyam & Robert F.Halsey (2006), Financial Statement

Analysis, 9th Edition, 2-90.
 Jonas Elmerraji, “Analyze Investments Quickly with ratios”, 2005, 33-36
 Kennedy and Muller, “Analysis of Financial Statements”,1999, 1.3 – 1.34
 Khan M Y & Jain P K, “Financial Management”, 4th Edition , 2006, 6.1 - 6.81
 Pandey I M, “A Management Guide for Managing Company’s Funds and Profits”, 6th
Edition, 1 – 58
 Peeler J. Patsula, “Successful Business Analysis”,2006, 18-19
 Rachchh Minaxi A (2011), Introduction to Management Accounting, 3-88.
58
 Reddy T S & Hari Prasad Reddy Y, “Management Accounting”, 3rd Edition, 2008, 3.9 -
3.25
 Salmi, T. and T. Martikainen (1994), "A review of the theoretical and empirical basis of
financial ratio analysis", The Finnish Journal of Business Economics 43:4, 426-448.
 Susan ward, “Financial Ratio Analysis For Performance Check”, p.132
Websites:
 www.google.com
 www.sundaramfinance.in
 http://scholar.google.com
 www.managementparadise.com
59
QUESTIONNAIRE
A study of preferences of the investors for investment in mutual funds.
1. Personal Details:
(a). Name:-
(b). Add: - Phone:-
(c). Age:-
(d). Qualification:-
Graduation/PG Under Graduate Others
2. What kind of investments you have made so far? Pl tick (√). All applicable.
a. Saving account b. Fixed deposits c. Insurance d. Mutual Fund

e. Post Office-NSC, etc f. Shares/Debentures g. Gold/ Silver h. Real Estate
3. While investing your money, which factor will you prefer?

.
(a) Liquidity (b) Low Risk (c) High Return (d) Trust
4. Are you aware about Mutual Funds and their operations? Pl tick (√). Yes No
5. If yes, how did you know about Mutual Fund?
a. Advertisement b. Peer Group c. Banks d. Financial Advisors
6. Have you ever invested in Mutual Fund? Pl tick (√). Yes No
7. If not invested in Mutual Fund then why?
(a) Not aware of MF (b) Higher risk (c) Not any specific reason
60
8. If yes, in which Mutual Fund you have invested? Pl. tick (√). All applicable.
a. SBIMF b. UTI c. HDFC d. Reliance e. Kotak f. Other. specify
9. If invested in SBIMF, you do so because (Pl. tick (√), all applicable).
a. SBIMF is associated with State Bank of India.

b. They have a record of giving good returns year after year.
c. Agent’ Advice
10. If NOT invested in SBIMF, you do so because (Pl. tick (√) all applicable).
a. You are not aware of SBIMF.

b. SBIMF gives less return compared to the others.
c. Agent’ Advice
11. When you plan to invest your money in asset management co. which AMC will you prefer?
Assets Management Co.

a. SBIMF
b. UTI
c. Reliance
d. HDFC
e. Kotak
f. ICICI
12. Which Channel will you prefer while investing in Mutual Fund?
(a) Financial Advisor (b) Bank (c) AMC
13. When you invest in Mutual Funds which mode of investment will you prefer? Pl. tick (√).
a. One Time Investment b. Systematic Investment Plan (SIP)
14. When you want to invest which type of funds would you choose?
61
a. Having only debt b. Having debt & equity c. Only equity portfolio.
portfolio portfolio.
15. How would you like to receive the returns every year? Pl. tick (√).
a. Dividend payout b. Dividend re-investment c. Growth in NAV
16. Instead of general Mutual Funds, would you like to invest in sectorial funds?
Please tick (√). Yes No
62

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Project Report on

“A study on Financial performance analysis of

FOR THE PARTIAL FULFILLMENT OF DEGREE OF

Dr. Viraj Welturkar

DEPARTMENT OF BACHELOR OF BUSINESS

“A study on Financial performance analysis of the Sundaram Finanace

NMD College, Gondia

This is to certify that Atul Majumdar of BBA final year in department of

“ A study on Financial performance analysis of the Sundaram Finanace

I hereby declare that this project work “A study on Financial

I am using this opportunity to express my gratitude to everyone who supported

“A study on Financial performance analysis of the Sundaram Finanace Ltd

I am thankful for their aspiring guidance, invaluably constructive criticism and

(BBA Final Year)

3 OBJECTIVES OF THE COMPANY 10

4 NEED FOR THE STUDY 13

5 OBJECTIVES OF THE STUDY 15

6 SCOPE OF THE STUDY 17

10 DATE ANALYSIS AND INTERPRETATION 31

NON-BANKING FINANCIAL COMPANIES (NBFCS)

Non-bank financial companies (NBFCs) are financial institutions that provide

According to Reserve Bank Amendment of Act 1997, A Non-Banding Financial Company

 A financial institution which is a company

CURRENT SCENARIO OF NBFCS

The base of today’s feebleness of Non-Banking Finance Companies can perhaps be

 Review of minimum capital requirement of Rs. 25lakhs for registration purposes

1. Lower transaction costs

RBI GUIDELINES FOR NBFCs

i. Equipment leasing and hire purchase (finance company)

1. Hire purchase finance company – A company, which is a financial institution, carrying on

2. Investment Company – A company, which deals with acquisition of securities.

4. Mutual benefit finance company – A company, which is a financial institution. This is

FOUNDER OF THE COMPANY

THE MAIN ACTIVITIES OF SUNDARAM FINANCE LIMITED

FIVE PILLARS OF SUNDARAM FINANCE LIMITED

CORPORATE PHILOSOPHY OF THE COMPANY

 Truth and fairness guide the management of finance

OBJECTIVES OF THE COMPANY

OBJECTIVES OF THE COMPANY

 Support of the group companies.

 Sundaram Business Services

 ‘Certificate of Commendation’ award by the Government of India under the scheme of

 “Automan Award” to Shri T S Santhanam, Chairman, from Motor India in 1998.

 “Pioneering Service Award” to Shri T S Santhanam Chairman, from Chennai Good

NEED FOR THE STUDY

NEED FOR THE STUDY

The study on effectiveness of operational and financial performance of Sundaram finance

OBJECTIVES OF THE STUDY

OBJECTIVES OF THE STUDY

o To study the financial performance analysis of Sundaram Finance Limited, Chennai.

o To know the profitability, liquidity and solvency position of Sundaram finance

o To compare and interpret financial statements of the Sundaram Finance Limited

o To provide suggestions for improving the overall finance performance of the

SCOPE OF THE STUDY

SCOPE OF THE STUDY

The study is based on the accounting information of the SUNDARAM FINANCE

TOOLS USED FOR ANALYSIS

(1) Ratio Analysis

(2) Comparative Statement Analysis

(3) Common-size Statement Analysis

(4) Cash Flow Statement Analysis

(5) Regression Analysis

o GROSS PROFIT RATIO