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TABLE OF CONTENT
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INTRODUCTION

Nishat Chunian LTD is a vertically integrated Textile Company that was founded
in 1990 and over the years. With an annual sale of over 49.284 billion, it has
become Pakistan’s largest textile industry in terms of its sales. Today, Nishat
Chunian Group of companies consists of 3 big companies which include Nishat
Chunian Textile Company, Nishat Chunian Power Generation Company, and
Nishat Chunian USA. The Company is located in Lahore with over 1480
employees across all of its locations.
The company has an annual spinning production of over 85000 tons of yarns, it
has greige fabric of over 54 million meters and 36 million meters of the
finished fabric. The company has a setup of a 200 MV independent power
plant to cope up with the current escalating energy demand.
The Purpose of the company is to generate value for its customers through
commitment and integrity and the business principle of the company is to
manufacture Fibre, Yarn, and thread mills and then sell them to various
markets.
The purpose and objective of this project are to basically compare the financial
statement of Nishat Chunian LTD for 2019 and 2020 and take their ratios which
involves (current ratio, Debt to net worth ratio, Return on equity and return on
asset ratio) and interpret them according to their given numbers. Secondly to
find the Risk and Return analysis of the company through (Expected return, risk
of a stock, risk of market, return on the stock, and return on portfolio) with the
help of MS excel.
Email: matif@nishat.net
Lahore Tel: +92 42 35761730-9
Fax: +92 42 35878696-7
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CURRENT RATIOS
 FORMULA: L.R= Current Assets/Current liabilities
 Results:

ACCOUNT20,376,070/11,254,499
2020 2019 18,072,999/14,494,409

Current For 2020

20,376,070 For 2019
18,072,999
Asset
1.810 1.246
Current 11,254,499 14,494,409
Liabilities

BAR CHART:

Current rati os

2
1.8
1.6
1.4
RATIOS

1.2
1.81
1
0.8 1.25
0.6
0.4
0.2
0
2020 2019

Column1

Conclusion:
FINDINGS: In 2020 and 2019 the current ratio is 1.810 and 1.246 respectively.
INTERPRETATION: As we can see from the chart is that the current assets for
2019 and 2020 is higher than its current liabilities which indicates that the
company has higher liquidity and can pay its current liabilities very easily.
Conclusion: The current Ratio for Nishat chunian LTD is 1.810 and 1.246
respectively, currently finding and analysing the values of the Current ratio
Analysis.
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DEBT TO NET WORTH RATIO

 Formula: F.L.R=DEBT/NET WORTH

 Results
Account 2020 2019 10,767,661/29,570,763
9,705,011/30,950,706

Debt For 2020

9,705,011 For 2019
10,767,661
0.313 0.364
Net Worth 30,950,706 29,570,763

BAR CHART:

DEBT TO NET WORTH RATIO

0.37
0.36
0.35
0.34
RATIOS

0.33 0.36
0.32
0.31 0.31
0.3
0.29
0.28
2020 2019

Series 3

CONCLUSION
Findings: In 2020 and 2019 the current ratio is 0.313 and 0.364 respectively.
INTERPRETATION: As we can see from the chart is that the Debt to net
worth ratio for 2019 is greater than for 2020 which means that the company is
performing well to generate profit which means that they have focused on their
debt and overcome their debt on time which has improved the financial health
of the company.
Conclusion: Debt to net worth ratio for 2019 and 2020 which is 0.313 and
0.364, currently finding the debt to net worth ratio analysis.
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RETURN ON EQUITY
 Formula: P= Net profit after taxes/shareholder equity
 Results

Account 2020 2019

4,605,770/18,965,940 3,416,558/14,360,170
Net profit 4,605,770 3,416,558
For 2020 For 2019
after tax
0.242 0.237
Shareholder 18,965,940 14,360,170
Equity

BAR CHART:

RETURN ON EQUITY

0.16
0.14
0.12
0.1
RATIOS

0.15
0.08
0.12
0.06
0.04
0.02
0
2020 2019

CONCLUSION
FINDINGS: In 2020 and 2019 the current ratio is 0.242 and 0.237 respectively.
INTERPRETATION: In 2020 the return on equity is higher than 2019 which
indicates that the company has utilization better capital than 2019 which means
that the company is operating their capital in different assets so the company
can generate more capital next year.
CONCLUSION: Calculation & analysis of Nishat Chunian Ltd Company, the
return on equity of 2020 & 2019 is 0.242 & 0.237 and are currently finding &
analysing the return on equity analysis.
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RETURN ON ASSET RATIO

 Formula: P= NET INCOME/TOTAL ASSETS
 Results
Account 2020 2019
4,605,770/3,416,558 30,950,706/29,570,763
NET 4,605,770 30,950,706
For 2020 For 2019
INCOME
1.348 1.046
TOTAL 3,416,558 29,570,763
ASSETS

BAR CHART:

Return on Asset ratio

1.4
1.2
1
0.8 1.35
1.05
0.6
0.4
0.2
0
2020 2019

Series 3

CONCLUSION
Findings: In 2020 and 2019 the current ratio is 1.348 and 1.046 respectively.
Interpretation: As we can see from the chart is that Return on asset is
increasing in 2020 as compared to 2019 which means that the company is
performing well and is improving in profits with each investment rupee
Conclusion: Calculation & analysis of Nishat Chunian Ltd Company, the return
on asset of 2020 & 2019 is 1.348 & 1.046 and are currently finding & analysing
the return on equity asset.