Course Code:ACC506 Course Title: Financial Reporting statement and

Analysis - I
Course Instructor: Dr. Purnima Satija Academic Task No.: 01

Date of allotment:30 Nov 2022 Date of submission: 16th Dec 2022

Student Name: Yogesh Sharma Section: Q2152

Student’s Roll No: Student’s Reg. No: 12115979

Evaluation Parameters: (Parameters on which student is to be evaluated- To be mentioned by students as

specified at the time of assigning the task by the instructor)

Learning Outcomes: (Student to write briefly about learnings obtained from the academic tasks)

Declaration:

I declare that this assignment is an individual work. I have not copied it from any other student’s work or from
any other source except where due acknowledgement is made explicitly in the text, nor has any part been written
for me by any other person.

Student’s Signature:

Evaluator’scomments (For Instructor’s use only)

General Observations Suggestions for Improvement Best part of assignment

Evaluator’s Signature and Date:

Marks Obtained: Max. Mark:___________

 Vindhya Telelink
INTRODUCTION
Part of the M.P. Birla Group, Vindhya Telelinks Limited is the outcome of a
Public-Private joint venture between Universal Cables Limited and the
Madhya Pradesh State Industrial Development Corporation Limited. At the
time of its conception, Vindhya Telelink's primary mandate was to
manufacture Jelly Filled Telephone Cables (JFTC). With the completion of
its manufacturing plant at Rewa (M.P.); Vindhya Telelinks commenced
commercial production in 1986.

Vindhya Telelinks Limited has forayed in to LED lighting Industry to

provide end to end LED lighting solutions across various verticals under the
brand name BIRLA LED to cater to the requirements of the Indian market
on a long term basis. VTL in their urge to develop green lighting solutions
that reduce operating costs, improve productivity and alleviate the world’s
most pressing environmental challenges, BIRLA LED is leading the way
into a new era of environmentally and human friendly LED lighting. BIRLA
LED has a proven track record of helping companies maximize the potential
business benefits LED lighting has to offer. By combining the most
advanced digital control, thermal management and lighting fixture designs
and International quality standards and performances, BIRLA LED provides
the most versatile, best in class and cost–effective LED lighting solutions
available in the market.
 COMPARATIVE ANALYSIS OF BALANCED SHEET OF BHARAT GEARS:

❖ ABSOULTE CHANGE =CURRENT YEAR – BASE YEAR

❖ PERCENTAGE CHANGE=ABSOULTE CHANGE/BASE YEAR *100

Absolute Change Percentage Change

Particulars 2020 2021 2022
2020-2021 2021-2022 2020-2021 2021-2022

EQUITIES AND
LIABILITIES

Equity Share
Capital 930.61 930.61 1023.67 93.06 9.999893
0 0

Reserves and
Surplus 7026.8 6450.67 9795.55 -576.13 3344.88 -8.19904 51.85322

Total
Shareholders’ 7957.41 7381.28 10819.22 -576.13 3437.94 -7.240169854 46.57647454
Funds

NON-CURRENT
LIABILITIES

Long Term
Borrowings 8230.59 6662.39 6125.6 -1568.2 -536.79 -19.0533121 -8.057018577

Lease Liabilities 129.77 501.03 416.37 371.26 -84.66 286.090776 -16.89719178

Other Financial
255.2 303.61 196.78 48.41 18.96943574 -35.18658806
Liabilities -106.83
Provisions 461.32 2072.95 2081.97 1611.63 9.02 349.3518599 0.435128681

Other non- 1930.04 321.65 377.4 -1608.39 55.75 -83.33454229 17.33250427

current liabilities

Total Non-
Current 11006.92 9861.63 9198.12 -1145.29 -663.51 -10.40518147 -6.728198077
Liabilities

CURRENT
LIABILITIES

Short Term
Borrowings 4224.38 4473.17 3957.68 248.79 -515.49 5.889384951 -11.52404223

Lease Liabilities 139.49 160.41 33.61 -12.69 24.0949172 -7.33102253

173.1

Trade Payables 10906.46 15651.03 15073.16 4744.57 -577.87 30.31475 -3.83377

Other Current
426.97 223.15 440.76 -203.82 217.61 -47.73637492 97.517365
Liabilities

Short Term
114.26 376.5 360.13 262.24 -16.37 229.5116401 -4.347941567
Provisions

Total Current
18449.7 21120.28 2670.58 -782.27 14.47492371 -3.70388082
Liabilities 20338.01

Total Capital and

37414.03 38363.19 40355.35 949.16 1992.16 2.536909282 5.192894543
Liabilities

ASSETS

NON-CURRENT
ASSETS
Property,
Equipment 14450.42 12632.05 11208.39 -1818.37 -1423.66 -12.58350968 -11.27022138

Intangible Assets
127.27 106.64 81.67 -20.63 -24.97 -16.20963306 -23.41522881

Capital Work-In-
Progress 217.22 132.28 114.12 -84.94 -18.16 -39.10321333 -13.72845479

Right use of Asset 376.14 619.54 496.35 243.4 -123.19 64.70994842 -19.88410756

Loans
164.26 191.37 178.39 27.11 -12.98 16.50432242 -6.78267231
Others 207.03 215.16 222.48 8.13 7.32 3.926967106
3.402119353

Deferred Tax 850.81 1013.5 583.3 162.69 -430.2 19.12177807 -42.44696596

Asset

Other Non-
Current Assets 360.7 358.3 498.08 -2.4 139.78 -0.665372886 39.01200112

Total Non-
Current Assets 16753.85 15268.84 13382.78 -1485.01 -1886.06 -8.863694017 -12.35234635

CURRENT ASSETS

Inventories 7814.76 9038.74 9045.97 1223.98 7.23 15.66241318 0.079989025

Trade
Receivables 10219.27 10627.43 14427.91 408.16 3800.48 3.994023056 35.76104477

Cash And Cash

Equivalents 69.2 9.82 303.69 -59.38 293.87 -85.80924855 2992.566191

Short Term Loans

and Advances 651.11 557.46 632.38 -93.65 74.92 -14.38313035 13.43952929
Other Current
Assets 2156.24 2076.19 653.21 -80.05 43.45954505 -3.712480985
1503.03

Current Tax asset

(net) 55.47 91.9 36.43 11.04 65.67513972
102.94 12.01305767

Total Current
Assets 20647.88 23082.05 26960.27 2434.17 3878.22 11.78895848 16.80188718

Total Assets 37414.03 38363.19 40355.35 949.16 1992.16 2.536909282 5.192894543

INCOME STATEMENT /PROFIT & LOSS ACCOUNT OF BHARAT GEARS

 Absolute Change Percentage Change
Particulars 2020 2021 2022

2020-2021 2021-2022 2020-2021 2021-2022

Revenue from
46311.98 50302.79 72944.16 3990.81 22641.37 8.61723 45.01017
operations

Other income 487.58 136.81 353.02 -350.77 216.21 -71.941 158.0367

Total income 46799.56 50439.6 73297.18 3640.04 22857.58 7.777936 45.31674

Expenses

Cost of materials
and components 22244.83 25598.69 37530.29 3353.86 11931.6 15.07703 46.6102
consumed

Changes in
inventories of
finished goods 1596.53 702.89 440.6 -893.64 -262.29 -55.9739 -37.3159
and work-in
progress

Employee
8980.36 8247.45 10713.57 -732.91 2466.12 -8.16125 29.90161
benefits expense

Finance costs 2164.82 2266.58 1842.48 101.76 -424.1 4.700622 -18.711

Depreciation and
amortisation 2668.73 2414.7 2039.44 -254.03 -375.26 -9.51876 -15.5406
expense

Other expenses 11626.54 13579.9 18565.06 1953.36 4985.16 16.80087 36.70984

Total expenses 49281.81 51404.43 70250.24 2122.62 18845.81 4.307106 36.66184

Profit/(Loss)
before
2482.25 964.83 3406.55 -1517.4 2441.72 -61.1308 253.0726
exceptional items
and tax

554.61 226.7 422.54 -327.91 195.84 -59.1244 86.3873

Deferred Tax

Profit/(Loss)
2482.25 964.83 3406.55 -1517.4 2441.72 -61.1308 253.0726
before tax

(Excess)/Short
provision for tax 49.86 31.93 41.39 -17.93 9.46 -35.9607 29.62731
relating to prior
years

Profit/(Loss) for
1877.78 770.06 2583.95 -1107.7 1813.89 -58.9909 235.5518
the year

Earnings per
20.38 8.03 26.43 -12.35 18.4 -60.5986 229.1407
share

Data Interpretation of Current Assets: -

 ❖ The inventories are increasing in the year 2021 as well as 2022 which shows that
there is more stock left with the company that means they are selling less.
❖ Trade Receivables are increasing which shows that ‘debtors’ are arising. The
company is having enough money because the debtors are paying on time and the
company is working very efficiently.
❖ Cash & Cash Equivalents are increasing for the year 2022 which shows that the
company was having surplus cash in the Balance sheet.
Other assets – Tangible or Intangible assets

❖ If the Tangible assets increase that means the business is in expansion mode.
❖ If the Intangible assets increase that means brand value of the company is
increasing to a large extent.
❖ Here as we see in year 2021 the assets are falling by 2.5% that means there was
some decline in the position of the company but in 2022 the brand value of the
company increased as there was increase in assets by 5.19%.

NON-CURRENT ASSETS:

Data interpretation of non-current assets-

• Tangible assets of the company are increasing in the year 2021 & 2022 that means
the company is in expansion mode.
• Intangible assets of the company are decreasing in 2021 that means the brand
value decrease to a large extent but in 2022 it falls which shows that there was
decrease in brand value.
• Deferred tax assets are decrease that means the company is not having any items
that can be used for tax relief purpose in the upcoming future.
• The decrease in capital work in progress from year 2021-2022 shows that initially
the machinery of the company was not prepared but in 2022 it was able to prepare
it.
 • Long-term loans are Decreasing in year 2022 with less amount in the company it
might invest in future in some project in future.

CURRENT LIABILITIES:

Data Interpretation of Current Liabilities-

• The borrowings of the company are increasing by 5.5% in year 2021 and in year
2022 it increased up to 11.29%, this shows that the company is not paying off its
loan very efficiently and will be not debt-free in the upcoming years.
• The trade payables are decreasing that mean less credit purchases are being done
by the company as compared to cash purchases in both years i.e., 2021 & 2022.
• Short-term provisions are decreasing that means the company is paying off its
short-term loans every year and the company can pay easily because it has
increase in the cash & cash equivalents every year.

4.NON-CURRENT LIABILITIES:

Data interpretation of non-current liabilities-

• The long-term borrowings of the company are decreasing that means the
company is paying off some debt and if we analyze the financial statement, the
amount decreases to a great extent in the year 2022 means company’s liquidity
position is less satisfactory.
• Deferred tax liabilities are increasing in 2021 as well as 2022 that means company
has to pay huge tax in terms of paying their liabilities.
• The increase in the long-term provisions means the company has been doing more
expenses and company has doubtful debts means is at financial risk.
INCOME STATEMENT:

Interpretation for P&L statements-

• The taxes for paying are being decreased in a company, in 2021 the taxes are falling
by greater percentage that means there will be more production and high demand
in the company.
• The net profits fell down by 73.04% in year 2021 but it increased in year 2022
which shows that the company is efficiently converting its sales into profits.

• More depreciation shows that company is buying more assets.

• Net sales of the company are increasing that shows the company is generating
enough income to pay off its debts.

• Fall in the value of interest in the respective years 2021 & 2022 shows that the
company is paying off its loans.

• Operating profits are increasing that means the company is able to generate good
amount of revenue and is easily controlling its expenses and overheads.

• Revenues are increasing that means the company is financially stable, and
shareholders will happily buy shares of this company.
 HORIZONTAL ANALYSIS OF THE FINANCIAL STATEMENTS:

• The company’s interest is being decreased which shows that the company is
having no financial risk and company can withstand the adverse effects or future
potential growth of the company.
• The company is not self-sufficient in some cases because it is depending upon
loans in order to run the business.
• The borrowings of the company are increasing that means company needs to
increase its sales.
• CWIP are decreasing means some part of the construction has been done in the
company.
• But the company is having good reserves, it can withstand adverse business
situations in the future.
• I will invest in the company, because it has a satisfactory liquidity position, not for
long term but surely short term which might give profit.
 GROWTH & FUTURE OUTLOOK OF Vindhya Telelinks

It was formed under a joint venture agreement between Universal Cables Ltd, and Madhya
Pradesh State Industrial Corporation Ltd. Vindhya Telelinks started out as a Jelly Filled Telephone
Cables manufacturer. Over the year, the company started manufacturing Optical Fiber
Telecommunication Cables as well. Vindhya Telelinks is a leading manufacturer and supplier of
these products and built a clientele of many prominent companies such as BSNL, NTPC, Reliance
Infocom, Bharti, Tata, etc. The company manufactures all its products out of its only plant
located in the Rewa district of Madhya Pradesh. The promoters of the company own 43.54% of
the stake in the company, Foreign Institutional Investors (FII) own 0.69%, Domestic Institutional
Investors (DII) own 9.13% stake in the company, and others (such as public & retail investors)
hold the balance of 46.64%.

In June 2021, quarterly net revenue was Rs. 342.27 crores, which has increased by
approximately 22.04 % from Rs. 280.45 crores for the April-June 2020 quarter. The quarterly net
profit in June 2021 was Rs. 27.02 crores, which has improved and increased by nearly 177.03%
from a net profit of Rs. 22.42 crores in June 2020. In June 2021, the reported operating profit
was at Rs. 313.08 crores, which is also increased by 11.46% as compared to an operating profit
of Rs. 280.89 crores for the quarter ending in June 2020. From an EPS of Rs. 18.92 in June 2020,
the EPS of Vindhya Telelinks Ltd has improved and reached an EPS of Rs. 22.8 per share in June
2021. VINDHYATEL's stock closed at Rs. 1,089.15 on 25th August’2021 (NSE). Vindhya Telelinks
Ltd has given a positive return of 23.08% in the last six months and returned 14.98% positively in
the previous year.

STRENGTH OF Vindhya Telelinks

❖ Effective Research and Development (R&D)
❖ Diverse revenue streams
❖ Innovation driven organization
❖ Low bargaining power of suppliers
❖ Ability to lead change in Communications Equipment
❖ Superior customer experience
❖ Organizational Resilience of Vindhya Telelinks Ltd
❖ High brand equity
❖ Highly skilled collaborators

WEAKNESS OF Vindhya Telelinks

❖ Employees’ less understanding of Vindhya Telelinks Ltd strategy
❖ Skills based hiring in Communications Equipment industry
❖ High operating costs
❖ No frontier risks strategy
❖ High bargaining power of channel partners in Communications Equipment industry
❖ Ability to respond to the competition
❖ Slow to harness new channels of communication
❖ Capital Spending Reduction
❖ Aligning sales with marketing
❖ Workers concerns about automation