FINANCIAL REPORT NEELU 7892009719 (2)

A STUDY ON ANALYSIS OF FINANCIAL STATEMENTS OF HAL
CHAPTER 1
INTRODUCTION
DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 1

Introduction: -
This study analyses the financial statements of company to gain the insights in to their financial
performance and positions. The study uses financial ratios, and comparative analysis tools to
evaluate the company’s profitability, efficiency, liquidity and solvency. The results show growth,
declines, improvement, effectiveness , ect. The study also identifies areas for improvements and
provides recommendations for stakeholders. The findings of this study contribute to the existing
body of knowledge on financial statements analysis and provide based on ratio analysis, a
powerful tool to assess the performance of a firm over a period, or to compare risk and return of
firms of different sizes. The ratio calculations will be based on actual financial reports and are
calculated and analysed carefully. Financial ratios are revealing and predicative. But financial
statements can also mislead with window dressing and fraudulent reporting. The chapter
provides examples.
Need of the study:-
 To find the solvency condition of the company.
 To analyses the profitability positions of the company.
 To understand the concept of ratio analysis in detail as a part of project.
Objectives of study: -
 To study the various tools of financial statements.
 To understand the process of analysis and interpretation.
 To analyses and interpret the ratio analyses, comparative statements, other statements of
the company under study.

 To know the financial positions, financial strength of the organization.
Scope of the study: -
 To know the financial positions, performance in ach year.
 To analyze the growth in each year.
 To know the profit made by company.
 Comparison study of all three of financial statements.
 The study helps us to know how to determine different financial statements.
Research Methodology: -
The present study of the project is based on different secondary sources of the company, such
as books, organization websites, other related websites, reports and financial statements of the
company.
Analysis and Interpretation: -
Analysis and interpretation of the data is done through the help of table, chart, followed by the
Interpretation.
Limitations of the study: -
 The study is based on 3 years data.
 The study was based on the information provided by the company.
 The conclusion is drawn on the available information of the company.

 The study on comparative financial statements, ratio analyses and other financial
statements is only limited to united breweries ltd company.
Financial Ratios and Tools Used for Analysis
 Analyzing the financial performance of companies involves using various financial ratios
and tools. These metrics help in assessing different aspects of a company's financial
health, including profitability, liquidity, efficiency, and solvency. Here’s a comprehensive
overview:
Financial Ratios
1. Profitability Ratios:Profitability ratios are a type of accounting ratio that helps in

determining the financial performance of business at the end of an accounting period.
Profitability ratios show how well a company is able to make profits from its operations.
 Gross Profit Margin= Gross Profit / Revenue
 Operating Profit Margin = Earnings before Interest and Tax (EBIT) / Revenue
 Net Profit Margin=Net Profit / Revenue
 Return on Assets (ROA) = Net Income / Average Total Assets
 Return on Equity (ROE) = Net Income / Shareholder's Equity
2. Liquidity Ratios:Liquidity ratios determine how quickly a company can convert the
assets and use them for meeting the dues that arise. The higher the ratio, the easier is the
ability to clear the debts and avoid defaulting on payments.

 Current Ratio = Current Assets / Current Liabilities
 Quick Ratio = Current Assets – Inventory / Current Liabilities

 Cash Ratio = Cash + Cash Equivalents / Current Liabilities
3. Efficiency Ratios:Efficiency ratios include the inventory turnover ratio, asset

turnover ratio, and receivables turnover ratio
 Inventory Turnover = Cost of Goods Sold / Average Inventory
 Receivables Turnover = Net Credit Sales / Average Accounts Receivable
 Total Asset Turnover = Net Sales / Total Assets
4. Solvency Ratios:A solvency ratio examines a firm's ability to meet its long-term debts and
obligations. The main solvency ratios include the debt-to-assets ratio, the interest coverage
ratio, the equity ratio, and the debt-to-equity (D/E) ratio.
 Debt to Equity Ratio = Outstanding Debt / Total Equity
 Interest Coverage Ratio = EBIT / Interest Expense
 Debt to Asset Ratio = Total Debt / Total Assets
Tools for Financial Analysis
1. Financial Statements:
 Income Statement: Provides insights into revenue, expenses, and profitability.

 Balance Sheet: Shows the company’s assets, liabilities, and equity at a

specific point in time
 Cash Flow Statement: Details the cash inflows and outflows from operating,
investing, and financing activities.
2. Trend Analysis:
 Examines financial data over multiple periods to identify patterns and trends.
3. Ratio Analysis:
 Uses the various financial ratios to compare a company’s performance over time
or against industry benchmarks.
4. Comparative Analysis:
 Compares financial metrics with industry peers to assess relative

performance.
5. Common Size Analysis:
 Converts financial statement items to percentages of a base figure (e.g., total

assets for balance sheet items) to facilitate comparison across periods or
companies.

CHAPTER 2
COMPANY PROFILE

Hindustan Aeronautics Limited (HAL)
Is an Indian public sector aerospace and defence company, headquartered in Bangalore.

Established on 23 December 1940, HAL is one of the oldest and largest aerospace and
defence manufacturers in the world.[6] HAL began aircraft manufacturing as early as 1942
with licensed production of Harlow PC-5, Curtiss P-36 Hawk and Volte A-31
Vengeance for the Indian Air Force. HAL currently has 11 dedicated Research and
development (R&D) centres and 21 manufacturing divisions under 4 production units
spread across India. HAL is managed by a board of directors appointed by the President
of India through the Ministry of Defence, Government of India. HAL is currently
involved in designing and manufacturing of fighter jets, helicopters, jet engine and

marine gas turbine engine, avionics, software development, spares supply, overhauling
and upgrading of Indian military aircraft.
The HAL HF-24 Marut fighter-bomber was the first indigenous fighter aircraft made in
India.

HISTORY
Workers check new fuel tanks during World War II
HAL was established as Hindustan Aircraft Limited in

Bangalore on 23 December 1940 by Walchand Hirachand in
association with the then Kingdom of Mysore.[9] Walchand
Hirachand became chairman of the company. The
company's office was opened at a bungalow called
"Eventide" on Domlur Road.
The organisation and equipment for the factory at Bangalore was set up by William D.
Pawley of the Intercontinental Aircraft Corporation of New York. Pawley obtained a large
number of machine-tools and equipment from the United States.

The Mysore Kingdom bought a one-third stake in the company and by April 1941 by investing
₹25 lakh as it believed this to be a strategic imperative. The decision by the government was
primarily motivated to boost British military hardware supplies in Asia to counter the increasing
threat posed by Imperial Japan during Second World War. The Kingdom of Mysore supplied
two directors, Air Marshal John Higgins was resident director. The first aircraft built was
a Harlow PC-5 On 2 April 1942, the government announced that the company had been
nationalised when it had bought out the stakes of Seth Walchand Hirachand and other promoters
so that it could act freely. The Mysore Kingdom refused to sell its stake in the company but
yielded the management control over to the British Indian Government.
In 1943 the Bangalore factory was handed over to the United States Army Air Forces but still
using Hindustan Aircraft management. The factory expanded rapidly and became the centre for
major overhaul and repair of American aircraft and was known as the 84th Air Depot. The first
aircraft to be overhauled was a Consolidated PBY Catalina followed by every type of aircraft
operated in India and Burma. When returned to Indian control two years later the factory had
become one of the largest overhaul and repair organisations in the East. In the post war
reorganisation the company built railway carriages as an interim activity.IJT prototype in its
hangar
After India gained independence in 1947, the management

of the company was passed over to the Government of India.
The total number of broad- gauge coaches manufactured by

the Hindustan Aircraft Limited during the year 1954 is 158.
Hindustan Aeronautics Limited (HAL) was formed on 1

October 1964 (the Registrar of Companies has a registration
date of 16 August 1963) when Hindustan Aircraft Limited joined the consortium formed in June
by the IAF Aircraft Manufacturing Depot, Kanpur (at the time manufacturing HS748 under
licence) and the group recently set up to manufacture MiG-21 under licence, with its new
factories planned in Koraput, Nasik and Hyderabad.Though HAL was not used actively for

developing newer models of fighter jets, except for the HF-24 Marut, the company has played a
crucial role in modernisation of the Indian Air Force. In 1957 company started
manufacturing Bristol Siddeley Orpheus jet engines under licence at new factory located in
Bangalore.
Production line of the HAL Dhruv at Bangalore
During the 1980s, HAL's operations saw a rapid increase

which resulted in the development of new indigenous
aircraft such as the HAL Tejas and HAL Dhruv. HAL
also developed an advanced version of the Mikoyan-
Gurevich MiG-21, known as MiG-21 Bison, which
increased its life-span by more than 20 years. HAL has also obtained several multimillion-dollar
contracts from leading international aerospace firms such as Airbus, Boeing and Honeywell to
manufacture aircraft spare parts and engines.
By 2012, HAL was reportedly bogged down in the details of production and has been slipping
on its schedules.[ On 1 April 2015, HAL reconstituted its Board with TS Raju as CMD, S
Subrahmanyan as Director (Operations), VM Chamola as Director (HR), CA Ramana Rao as
Director (Finance) and D K Venkatesh as Director (Engineering & R&D). There are two
government nominees in the board and six independent directors.
Light Combat Helicopter induction into the Indian Army
In March 2017, HAL's chairman and managing director T

Suvarna Raju announced that the company had finalised
plans for an indigenisation drive. The company plans to
produce nearly 1, 000 military helicopters, including Kamov
226, LCH (Light Combat Helicopter) ALH (Advanced Light Helicopter), and over 100 planes
over the next 10 years. HAL will manufacture the Kamov 226T helicopter under a joint venture
agreement with Russian defence manufacturers. The Kamov 226T will replace the country's fleet
of Cheetah and Chetak helicopters. Over the next 5 years, HAL will carry out major upgrade of

almost the entire fighter fleet of Indian Air Force including Su-30MKI, Jaguars, Mirage and
Hawk jets to make them "more lethal". The company will also deliver 123 Tejas Light Combat
Aircraft to the IAF from 2018 to 2019, at a rate of 16 jets per year. LCH production will now
take place in a newly built Light Combat Helicopter Production Hangar at Helicopter Division in
HAL Complex.
In view of Make in India policy and to increase the share of defence exports to achieve the target
of $5 billion by 2025, HAL is planning to set up logistic bases in Indonesia, Malaysia, Sri
Lanka and Vietnam with priority target for Southeast Asia, West Asia and North
African markets. It would not only help to promote HAL products but also act as service centre
for Soviet/Russian origin equipment.

Promoter holding remains unchaned @

Shareholing Summary 71.64% in mar 2024 qtr
6.36%
Foreign institutional investment (FII) have
6.75%
decreased holding from 12.93% to
12.42% in mar
12.42%
Mutual fund have increase holding
from 6.69% to 6.75%
71.64% Public shareholding @ 6.36%
Promoter FII MF Public

BOARD OF DIRECTORS
Shri C B Ananthakrishnan
Director (Finance) & CFO, Annual Report 2022-23
Chairman and Managing Director (Addl Bankers
Charge) State Bank of India
Punjab National Bank
Shri Jayadeva E P
Indian Bank
Director (Operations) Indian Overseas Bank
Bank of Baroda
Dr. D K Sunil
Canara Bank
Director (Engineering and R&D) Union Bank of India
Shri Atasi Baran Pradhan Statutory Auditor
Director (Human Resources) M/s. A John Moris & Co.,
Shri T. Natarajan Chartered Accountants, Bengaluru
Additional Secretary (Defence Production) Branch Auditors
Ministry of Defence M/s. S Srivastava & Co.,
Govt. Nominee Director Chartered Accountants, Lucknow
Shri M Z Siddique M/s. N G S & Co LLP
Distinguished Scientist (DS) Chartered Accountants, Mumbai
and Director General M/s. K. Prahlada Rao & Co.,
(Aeronautical Systems), DRDO Chartered Accountants, Hyderabad
Govt. Nominee Director M/s. D N Dokania & Associates
Dr. Divya Gupta Chartered Accountants, Bengaluru
Independent Director M/s. Rajesh K Jhunjhunwala & Co.,
Shri Deepak Abasaheb Shinde Chartered Accountants, Cuttack
Independent Director M/s. Abhijit Dutt & Associates
COMPANY SECRETARY Chartered Accountants, Kolkata
Shri Shailesh Bansal M/s. P. L. Tandon & Co.,
Company Secretary Chartered Accountants, Kanpur
M/s. Ganesan and Company

Chartered Accountants, Bengaluru M/s. GNV & Associates,

M/s. R Bupathy & Co., Cost & Management Accountants,
Chartered Accountants, Bengaluru Bengaluru
M/s. Ishwar & Gopal Legal Advisor
Chartered Accountants, Bengaluru M/s. Sundaraswamy & Ramdas,
M/s. A. Sachdev & Co., Advocates, Bengaluru
Chartered Accountants, Lucknow Tax Consultants
M/s. Vijay Panchappa & Co., M/s. BSR & Co. LLP,
Chartered Accountants, Bengaluru Chartered Accountants, Bengaluru
M/s. S S B & Associates Credit Rating Agencies
Chartered Accountants, Bengaluru M/s. ICRA Limited
M/s. P N R & Co., M/s. CARE Ratings Limited
Chartered Accountants, Bengaluru
Contact Details
M/s. Panduranga Shenoy & Co.,
Chartered Accountants, Bengaluru HAL Corporate Office
M/s.G R S M & Associates
15/1 Cubbon Road Bangalore 56001, India
Chartered Accountants, Bengaluru
Tel:91-80-22320701,22320903,22320376
M/s. S R R K Sharma Associates.,
Chartered Accountants, Bengaluru EmailId: Customerservice@Halindia.Co.In
Cost Auditor
Website: www.hal-india.co.in

Shri C B Ananthakrishnan Shri Anbuvelan

Chief Executive Officer
Director (Finance) & CFO,Chairman
and Managing Director
Shri Jayadeva E. P.
Director (Operations)
Shri Atasi Baran Pradhan
Director (Human Resources)
Dr. Divya Gupta Shri T Natarajan

Independent Director Additional Secretary
(Defence Production)
Govt. Nominee Director

Shri Deepak Abasaheb Shinde

Shri Mihir Kanti Mishra

Chief Executive Officer,
Collection: The required data for the study are basically secondary in nature and the data are
collected from the audited reports of the company. The sources of data are from CMIE
prowess database for annual report for the year 2021-2022 and the annual reports of
the company from the HAL’s website for the years 2022-23 to 2023-24 for a total of five
years. The data collected were edited, classified and tabulated for analysis. Time-
series analysis of the different ratios has been used in this study.

Overview of Company
Founded = 22 December 1940
Headquarters = Bangalore Karnataka India
Owner = Government of India (71.65%)
Company type = Public
Vision = To be a global leader in the Aerospace & Defence Industry.
Mission = We are committed to deliver superior technology solutions to the customers by

leveraging our infrastructure and Design, Manufacture & Service skills, for achieving business
excellence.
During the year, your Company has taken many new initiatives,which includes Design and
Development of LUH Civil, HindustanLead in Fighter Trainer (HLFT-42), ALH WSI Phase-II
program,Level D Full Flight Simulator for Hindustan-228, Full MissionSimulator for LUH,
Indigenisation of Integrated Architecture& Display System (IADS) and Automatic Flight
Control System(AFCS) of ALH. HAL also received a Development cum Production Partner
(DcPP)/ Production Agency (PA) certificatefor ABHYAS - High Speed Expendable Aerial
Target (HEAT)System from DRDO. Further, following significant MOUs havebeen signed by
HAL:
• With Safran Helicopter Engines to create a new jointventure intended for design, development,
production,sales and support of helicopter engines to meet not onlythe requirements of future
helicopters programmes ofIndian Defence including the 13-ton IMRH (Indian Multi-Role
Helicopter), but also for the Global market.

• With Air Mauritius Limited for undertaking a feasibilitystudy for enhancing / setting-up MRO
facility by AirMauritius towards maintenance and other associatedworks on HAL supplied Do-
228 aircraft to Mauritius AirSquadron as well as other countries in the region.
• With Rolls Royce in July, 2022 to explore the potentialopportunity of HAL to become in
Country partner supplierfor MT7 Marine Gas Turbine Package for sales within the
Indian Market.
• With Heroux Devtek at Farnborough Airshow on 19th July,2022, for design, development,
manufacture, repair andoverhaul of Landing gears of C-295 aircraft.
• With Honeywell International Inc. at Farnborough Airshowin July, 2022 for ‘High Power
Generation Equipmentcollaboration’.
.
Future Outlook
Indian Defence Sector which was so far contributing asstrategic sector is gradually developing
as an economic sectorwhich is capable to contribute to the economic growth of the
Country. Under the Atmanirbhar Bharat initiative, Governmentis facilitating the development of
the Indian industry to reducethe defence import as well as dependence on the foreign
OEMs. Various initiatives of the GoI in recent days have giventhrust on the indigenization and
indigenous procurement ofdefence equipment. Over next 5 -10 years such reforms will
Equally help Defence PSUs and private industry to put a firmstep towards achieving a self-
sustaining Defence industry inthe country.
As continuous efforts towards achieving self-reliance“Atmanirbharta” in the Aerospace &
Defence industry in India,HAL will remain involved in supporting Start-up Companies,SMEs/
MSMEs, Tier – II and III vendors. HAL will also keephandholding the vendors and suppliers in
R&D, capabilitydevelopment and extended employment generation.4 Hindustan Aeronautics
LimitedIn near future, Indian Defence market will continue to be primerevenue source for HAL
to projects like LCA Mk1A, LCH,LUH and HTT-40. The company has taken various initiatives
tomake systems more agile, effective, cost efficient and to be

Competitive. Enhancement of HAL capability is being plannedto cater above projects. New
production line are being installedfor HTT-40 and LCA Mk1A Production.
In medium term, we are also looking forward to diversify andincrease our presence in UAV,
Civil MRO & allied operations,Digital Solutions and new space segments as strategic
Initiatives. Also, we are focusing on strengthening marketingefforts, expanding geographical

presence and collaborationwith Indian Industry / Global OEMs to boost export sales.
Research and Development (R&D)
Company has continued its efforts towards the Designand Development of new platforms/
products / technology and activities to enhance its capability with a view to bringtechnological
superiority to its products and to cope up with the future technological challenges. These efforts
have resultedin major achievements such as successful first flight of ALH withtwo segmented
Main Rotor Blades and Pre-Cone Main RotorHead developed to address the stringent stowage
dimensionrequirement of Indian Navy, first Inverted Spin tests ofHTT-40, first flight of LCA
Mk1A and maiden arrested landing &ski-jump take-off by LCA Navy MK1 aircraft from the
indigenousaircraft carrier INS Vikrant.The futuristic projects such as LCA Mk II, Advance
MediumCombat Aircraft (AMCA), Indian Multirole Helicopter (IMRH),Twin Engine Deck
Based Fighter (TEDBF), Combat Air TeamingSystem (CATS) etc. will ensure technological
lead of HAL inthe years to come, due to significant design & developmentactivities. This will
provide good visibility for future platformorders.During the year, the Company has incurred a
total R&Dexpenditure of `2, 49,433 Lakh, which is 9.46% of the Turnover.The Company has
transferred a sum of `53,881 Lakh (15% ofOperating PAT) to R&D corpus during the year 2022-
23.
Corporate Governance

Company always strives to conduct the business withintegrity, and in ethical & transparent
manner and attain thehighest standard of Corporate Governance practice. TheCompany has
complied with the Guidelines on CorporateGovernance framed by the Department of Public
Enterprises(DPE) and SEBI Listing Regulations except for the appointmentof the requisite
number of Independent Directors. TheCompany has established Systems and Procedures to
ensure
that its Board of Directors is well informed about the Policies ofthe Company, to enable them to
discharge their responsibilitiesand to enhance the overall value of all stakeholders. We
areperiodically reviewing the Policies and Procedures of the Company and updating them to
ensure transparency in allaspects of the Company’s working. Your Company has
beencontinuously rated ‘Excellent’ grade for its compliances withDPE Guidelines on Corporate
Governance.
Corporate Social Responsibility and Sustainability Development
Company is committed to its social responsibility. In this endeavour, the Company has
undertaken various CSR programmes and projects, towards integrating our social and business
goals in a sustainable manner in line with schedule VII of the Companies Act, 2013. An amount
of ` 10,328 Lakh has been spent under CSR in the Financial Year 2022-23 against the CSR
budget/ obligation of `9,707 Lakh
BUSINESS SEGMENT AND SERVICE OFFERING
Hindustan Aeronautics Limited (HAL) is a major Indian public sector aerospace and defense
company. Its business segments and service offerings include:
1. Aerospace and Defense Manufacturing:
 Aircraft: HAL designs, manufactures, and assembles aircraft for military and civilian
applications. This includes fighter jets, helicopters, and transport aircraft.

 Helicopters: HAL produces a range of helicopters, including light combat helicopters

(LCH), advanced light helicopters (ALH), and others.
 Engines: HAL designs and manufactures aero engines for various aircraft and
helicopters.
2. Maintenance, Repair, and Overhaul (MRO):
 Aircraft and Helicopter MRO: HAL provides comprehensive MRO services for
military and civilian aircraft and helicopters.
 Engine MRO: HAL offers repair and overhaul services for a wide range of aero engines.
3. Aerospace Structures and Systems:
 Avionics: HAL develops and integrates advanced avionics systems for aircraft and
helicopters.
 Aerospace Components: HAL manufactures a variety of aerospace components and
subsystems for domestic and international customers.
4. Research and Development:
 Aerospace R&D: HAL invests significantly in research and development to design and
develop new aircraft, helicopters, and aerospace technologies.
 Collaborative Projects: HAL collaborates with national and international aerospace
organizations and companies for joint development projects
5. Defence Electronics:
 Radar Systems: HAL develops and manufactures radar systems for defense
applications.
 Electronic Warfare Systems: HAL provides electronic warfare systems and solutions
for military aircraft.
6. Space Programs:
 Satellite Components: HAL manufactures components and subsystems for satellites and
space applications in collaboration with Indian Space Research Organisation (ISRO).
7. Export and Offset Programs:
 Global Exports: HAL exports aircraft, components, and MRO services to various
countries.
 Offset Programs: HAL participates in international defense offset programs, partnering
with global aerospace and defense companies.

8. Civil Aviation:
 Regional Aircraft: HAL is involved in the development and manufacturing of regional
transport aircraft to support the civil aviation sector.
HAL's diverse service offerings and expertise in aerospace and defense make it a key player in
India's defense industry and a significant contributor to the country's self-reliance in defense
manufacturing.
GLOBAL PRESENCE AND MARKET SHARES
 US$1 billion contract to manufacture aircraft parts for Boeing.

 120 RD-33MK turbofan engines to be manufactured for MiG-29K by HAL for US$250
million
 Contract to manufacture 1,000 Honeywell TPE331 aircraft engines for Honeywell worth
US$200,000 each (estimates put total value of deal at US$200 million).
 US$120 million deal to manufacture Dornier 228 for RUAG of Switzerland.
 Manufacture of aircraft parts for Airbus SAS worth US$150 million.
 US$100 million contract to export composite materials to Israel Aerospace Industries.
 US$65 million joint-research facility with Honeywell and planned production of Honeywell
TPE331 engines.
 US$50.7 million contract to supply Advanced Light Helicopter to Ecuadorian Air Force.[
HAL will also open a maintenance base in the country.
 US$30 million contract to supply avionics for Malaysian Su-30MKM.
 US$20 million contract to supply ambulance version of HAL Dhruv to Peru.
 Contract of 3 HAL Dhruv helicopters for Turkey worth US$20 million.
 US$10 million order from Namibia for HAL Chetak and Cheetah helicopters.
 Supply of HAL Dhruv helicopters to Mauritius' National Police in a deal worth US$7
million.
 Unmanned helicopter development project with Israel Aerospace Industries.

 US$15 million contract for supplying steel and nickel alloy forgings to GE Aviation for its
global military and commercial engine programmes.
CHAPTER = 3
FINANCIAL PERFORMANCE ANALYSIS

TREND ANALYSIS OF REVENUE ,PROFITS AND OTHER FINANCIAL KEY MATRICS
To perform a trend analysis of revenue, profits, and other key financial metrics for HAL, we'll
focus on the company's financial statements over the past few years. The key metrics we will
analyse typically include:
1. Revenue: Total income generated from sales and services.

2. Net Profit (or Loss): Earnings after all expenses have been deducted from revenue.
3. EBITDA: Earnings before interest, taxes, depreciation, and amortization.
4. Gross Merchandise Value (GMV): Total sales dollar value for merchandise sold
through a marketplace.
5. Operating Expenses: Costs incurred during regular business operations.
6. Cash Flow: Net amount of cash being transferred into and out of the business.
7. Customer Acquisition Cost (CAC): The cost associated with acquiring a new customer.
8. Active Users: Number of active users on the platform.
To proceed with the trend analysis, we need financial data from HAL annual reports or other
credible financial sources. Since I cannot browse the web in real-time, I recommend the
following steps to gather the necessary data:
1. Annual Reports: Check HAL official website or the investor relations section for their
annual reports.
2. Stock Exchange Filings: Look at HAL filings with the relevant stock exchanges if it is a
publicly traded company.
Once the data is collected, we can visualize and analyse the trends in the following steps:
1. Data Collection: Gather data for the past 3-5 years for all key metrics.
2. Data Analysis: Calculate year-over-year growth rates, identify patterns, and highlight
significant changes.
3. Visualization: Use graphs and charts to visualize trends over time.
CONCOLIDATED BALANCE SHEET

OF 2021 TO 2023
Particular 2022-23 2021-22 2020-21
Equity And Liabilities
Equity Share Capital 334.39 334.39 334.39
Total share capital 334.39 334.39 334.39
Reserves and surplus 23,237.76 18,978.74 15,077.88
Total reserves and surplus 23,237.76 18,978.74 15,077.88
Total shareholders funds 23,572.15 19,313.13 15,412.27
Non current liablities

Other long term liablities 11,453.54 12,789.55 9,803.29
Long term provision 1,347.10 1,263.01 1,215.72
Total non-current liablities 12,800.64 14,052.56 11,.19.01
Current liablities
Trade payables 3,134.97 2,557.61 2,241.02
Other current liablities 20,913.99 17,407.97 19,284.24
Short term peovisions 6,778.31 5,056.96 3,976.38
Total current liablities 30,827.27 25,022.54 25,510.71
Total capital and liablities 67,203.80 58,391.98 51,945.90
ASSETS
Non-current assets
Tangiable assets 5,798.62 5,927.61 6,547.04
intangible assets 1,035.75 838.27 944.07
Current work-in-progress 636.9 949.1 791.56
Fixed assets 8,719.37 9,238.82 9,568.94
Non-current investment 1,457.92 1,362.70 1,055.51
Deferred tax assets (net) 1,125.71 565.57 52.35

Long term loans and advances 6.21 6.23 46.13
Other non- current assets 4,009.55 2,224.94 1,051.62

Total non-current assets 15,318.76 13,398.26 11,774.55
current assets
iInventories 12,148.69 14,347.28 16,544.77
Tread receivable 4,719.07 4,641.52 5,637.86
Cash and cash equivalents 20,316.61 14,347.72 7,177.35
Total current assets 51,885.04 44,993.72 40,171.35

CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR 2021 TO 2023
Particular 2023 2022 2021

Revenue from operatio (gross) 26,360.56 24,361.47 22,368.89
Total operating (net) 26,360.56 24,361.47 22,368.89
Total operating revenues 26,927.46 24,620.02 22,754.54
Other income 1,670.12 984.93 358.23
Total revenue 28,598 25,604.95 23,112.77
EXPENESES
Cost of materials consumed 9,993.68 8,752.24 7,764.72
Purchase 0f stock-in trade 799.15 656.68 821.16
Changes in inventories of FGWIP and stock
in trade -690.72 592.3 2,458.14
Employee benefit expenses 4,910.37 4,604.42 4,305.17
Financial costs 57.97 58.2 259.17
Depreciation and amortisation expenses 2,382.10 1,286.96 1,178.28
Other expenses 2,076.62 1,534.01 1,475.80
Total expenses 22,090.95 20,380.19 18,842.61
Profit and loss before tac 6,506.63 5,224.76 4,272.18
TAX EXPENSES-CONTINUED
OPERATIONS
current tax 2,250.00 1,900.00 645
Deferred tax -594.77 -562.62 442.26
Total tax expenses 681.77 144.65 1,037.93
P/L after tax and before extraordinary 5,824.86 5,080.11 3,234.25
items
P/L From continuing operation 5,824.86 5,080.11 3,234.25
Profit and Loss for the period 5,824.86 5,080.11 3,234.25
minority interest 0.01 0.16 0.40
Consolidated P/L after MI and associates 5,827.74 5,080.04 3,239.46
FINANCIAL RATIOS:
1. Liquidity Ratio
a) Current Ratio
b) Liquidity Ratio
c) Absolute Liquidity Ratio / Cash Position Ratio
d) Inventory to Working Capital Ratio / Stock Ratio
2.Profitability Ratio
a) Gross Profit Ratio

b) Net Profit Ratio
c) Return on total Assets Ratio
d) Return on Equity Ratio (ROE)
e) Return on Capital Employed Ratio (ROCE)
3.Leverage Ratio / Capital structure Ratio / Earnings Ratio
a) Debt Equity Ratio

b) Capital Gearing Ratio
c) Proprietors Ratio
d) Debt to total Asset Ratio
e) Interest Coverage Ratio

f) Debt service Coverage Ratio
2. Activity Ratio / Performance Ratio / Turnover ratio
a) Inventory Turnover Ratio

b) Debtors Turnover Ratio
c) Creditors Turnover Ratio
d) Fixed asset Turnover Ratio
Financial Ratios
Liquidity Ratio
The liquid ratio, also known as the acid-test ratio or quick ratio, is a measure of a company's
ability to meet its short-term liabilities with its most liquid assets.
Current Ratio
The current ratio is a financial metric used to evaluate a company's ability to pay its short-term
liabilities with its short-term assets. The formula for the current ratio is:
Current Asseta
Current Ratio=
Current Liabilities
Years Currente Assets Current Liabilities Current Ratio

2023 51885.04 30827.27 1.683
2022 44993.72 25022.54 1.798
2021 40171.35 25510.71 1.57

Current Ratio
1.85
1.8
1.75
1.7 Current Ratio
1.65
1.6
1.55
1.5
1.45
2023 2022 2021
Interpretation
From this graph we can find that in year 2022 the organisation was capable of managing its
operation at it optimim but in 2023 it slightly reached below ratio however it still managed to
operate effectively as compared to 2021
Quick Ratio
The liquid ratio, also known as the acid-test ratio or quick ratio, is a measure of a company's
ability to meet its short-term liabilities with its most liquid assets. The formula is:
In simplified terms, it is:
Quick Assets
Quick Ratio=
Current Liabilities
Year Quick assets Current liabilities Liquidity Ratio

2023 39736.35 30827.27 1.288
2022 30646.44 25022.54 1.224
2021 23626.58 25510.71 0.926

Quick Ratio
1.4
1.2
0.8
0.6
0.4
0.2
0
2023 2022 2021
Interpretation
In the year 2021 the company was able to meet it short term liabilities in the lower ratio but it
increase in the following years as we compare 2022 and 2023 we can find that it was able to
manage in the most effective way in the year 2023
Cash Ratio
The cash ratio is a financial metric used to evaluate a company's liquidity and ability to cover its
short-term liabilities with its cashand cash equivalents. The formula for the cash ratio is:
Cash∧cash equivalent
Cash Ratio =
Current liabilities
Year Cash and cash Current Cash Ratio

equivalent liabilities
2022 20316.61 30827.27 0.659
2023 14347.72 25022.54 0.573

2024 7177.35 25510.71 0.281
Cash Ratio
0.7
0.6
0.5
0.4 Cash Ratio
0.3
0.2
0.1
0
2023 2022 2021
Interpretation
From the above graph we can conclude that from the 3years the company repadly increase it
capablitly of meeting it short term liabilities with cash.
PROFITABLITY RATIO
Gross profit Ratio
Gross profit ratio (GPR) is a financial metric that shows the proportion of money left over from
revenues after accounting for the cost of goods sold (COGS). It's an indicator of a company's
financial health and efficiency in managing production costs.
Gross Profit
Gross Profit Ratio = ×100
net sales

Year Gross profit(cr) Net sales(cr) Gross Profit Ratio

2023 10657.36 26360.56 40.429
2022 10348.13 24361.47 42.47
2021 9477.84 22368.89 42.37
Goss Profit Ratio

43
42.5
42
41.5 Goss Profit Ratio
41
40.5
40
39.5
39
2021 2022 2023
Interpreation
From the above chart we can conclude that the company had sound gross profit in the year 2022
but it drastically went down in the year 2023 as compared to both the year the company was able
to function in the most effective way in the year 2022
Net Profit Ratio
Net Profit Ratio is an important Profitability Ratio that shows the relationship between net sales
and net profit after tax. When expressed as percentage, it is known as net profit margin.
Type equation here .
Net Profit After Tax

Net Profit Ratio = × 100
Sales

Year NPAT Sales Net Profit Ratio
2023 5824.86 26360.56 22.096
2022 5080.11 24361.47 20.85
2021 3234.25 22368.89 14.45
Net Profit Ratio

25
20
15 Net Profit Ratio
10
0
2023 2022 2021
Interpreation
Here we can come to the conclusion the company made large number of sale and earned high
profit in the year 2023.
Return on equity (return on after tax)
Return on equity (ROE) is a financial ratio that measures a company's ability to generate profit
from its shareholders' equity. It is expressed as a percentage and calculated using the following
formula:

Earning After Tax

Return on equity = × 100
S h are h olders Fund
Year Earnings after tax Shareholders’equity Return on equity
2022-23 5824.86 23572.15 24.71

2021-22 5080.11 19313.13 26.30
2020-21 3234.25 15412.27 20.98
Return On Equity
30
25
20
Return On Equity
15
10
0
2023 2022 2021
Interpreation
There is a general upward trend in the eranings and equity over the year but in the year 2022 the
ROE saw the peak. In the year 2023 it slightly declained this indicate that the companys earnings
have grown proponately
Solvency Ratio

A solvancy ratio is a vital metric used to see a business ability to fulfill longterm debt
requirement and is used by prospective business lenders. Itshows whether a company cash flow
is good enough to meet its long-terms liabilities.
Asset turnover Ratio
The asset turnover ratio measures the efficiency of a company's use of its assets to generate sales
revenue. The formula for calculating the asset turnover ratio is:
Net Sale
Asset Turnover Ratio=
Average Total Assets
Year Net sale Average Total assets Asset Turnover Ratio

2022-23 26360.56 62797.89 0.419
2021-22 24361.47 55168.94 0.441
2020-21 22368.89 52606.81 0.425
Asset Turnover Ratio

0.445
0.44
0.435
0.43 Asset Turnover Ratio
0.425
0.42
0.415
0.41
0.405
2023 2022 2021
Interpretation
Assets turnover ratio measures how efficiently a company uses its assets to generate sales.In the
year 2021 the ratio is at certain level . It increased in the year 2022 showing an improved asset
utilisation in generating sales. But in the year 2023 there was a decline in the ratio as compared
to both the years.

Debt equity Ratio
The debt-to-equity ratio measures a company's financial leverage by comparing its total
liabilities to its shareholders' equity. The formula for calculating the debt-to-equity ratio is
Total Liablilities
Debt equity ratio =
S h are h older Fund
Year Total Liablities Shareholder Fund Debt Equity Ratio

2022-23 30827.27 23572.15 1.307
2021-22 25022.54 19313.13 1.295
2020-21 25510.71 15412.27 1.655
Debt Equity Ratio

2.5
1.5 Debt Equity Ratio
0.5
0
2023 2022 2021
Interpretation
In the year 2021the company has taken highest debt and in the year 2022 there is decline trend in
debt. This indicates that the company is reducing its debts but again there is a slight increase in
the debt taking ratioin the year 2023

Proprietary Ratio
The proprietary ratio is afinancial ratio that measures the proportion of a company total assets
that are financial by its shareholders equity
Proprietary fund
Proprietor Ratio =
Total Assets
Year Proprietary fund Total Assets Proprietary Ratio

2022-23 23572.15 67203.80 0.350
2021-22 19313.13 58391.98 0.330
2020-21 15412.27 51945.90 0.296
Proprietary Ratio
0.4
0.35
0.3
0.25
Proprietary Ratio
0.2
0.15
0.1
0.05
0
2023 2022 2021
Interpretation
There is an increase in the proprietary ratio from the year 2021 to 2022 suggesting
improved financial stablity and again in the year 2023 the company slightly increase it propation
of equity.

Receivable Turnover Ratio
The accouts receivables turnover ratio measures the numbers of times a

company collects its average accounts receivable balance. It is a quantification of a companys
effectiveness in collecting outstanding balance from clients and managing its line of credit
process
Net sales
Receivable Turnover Ratio =
Average Receivable
Year Net sale Average Receiable RTR

2022-23 26360.56 46361.47 5.63
2021-22 24361.47 5139.69 4.73
2020-21 22368.89 8610.62 2.59

6
4
3
0
2023 2022 2021
Interpretation

The company as been progresively improving it receivable collection effecintly over the past
3year indicating better credit management and positively more effectively account receivable
process.
CHAPTER 4
FINDINGS, SUGGESTION AND CONCLUSION

Findings
On the basis of the analysis of the financial data of five years 2021 to 2024Of Hindustan
Aeronautics Limited, the following findings are made:
Net Working Capital has shown an increasing trend except a marginal decrease in 2022.
The current ratio has increased which shows that the company is capable of paying its
obligations as it has larger portion of asset value relative to liabilities value.
Inventory turnover ratio has increased over time which shows the company is having average
sales therefore showing excess inventory.
Debtors' turnover ratio is increased which shows the company have average collecting process.
Creditors' turnover ratio increase in 2024; which shows the company is taking average time to
pay-off its suppliers.
Suggestions
On the basis of the findings mentioned before, the following suggestions are made for improving
the of the company.
 The inventory should be used up properly to increase its turnover ratio.
 The payment duration towards creditors should not be delayed.

 The time provided for collection period is more than required.

 The net profit should be increased through efficient use of assets.
Conclusion
The objective of the project was to analyse the financial statement and to determine and identify
financial strengths. Weaknesses and relationships that exist in the company.
The conclusion of the above study is as follows:
Financial statement analysis provides valuable insights into a firm's performance. By doing this
study we get to understand the basics of financial statement analysis and how it is done with the
help of data available. Financial statement analysis helps us in understanding the overall position
of the company .
•The profitability position of the company is satisfactory which we can see from the various
tables and charts of profitability ratios.
•The company does not have any debt capital and because of that the risk is also not there or
very minimal risk.
•Though the liquidity and solvency position of the company has is good as it is over the standard
ratios.
The analysis and interpretation of various data relating to helped to reach into a conclusion that
the efficiency of the financial is sufficient since the working capital shows a positive balance.
But this cannot be blamed as this is government run organization and the major portion of
current liability is the loan taken from the government. It also reveals that the company is having
a satisfactory liquidity and profitability position. The overall success of any company depends
upon the working capital position. So it should handle properly because it shows the efficiency
and financial strength of the company. Therefore the company should adhere to strict measures
in every sphere of its activities to bring the company back to sufficient working capital position
and improve its financial performance for better prospects in the coming days.
BIBLIOGRAPHY
The sources of the data are follows:

www.HALINDIA.CO.IN
www.wikipedia.com
www.moneycontrol.com
https://service.hal-india.co.in/
• Text books and study material for reference

FINANCIAL REPORT NEELU 7892009719 (2)

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FINANCIAL REPORT NEELU 7892009719 (2)

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A STUDY ON ANALYSIS OF FINANCIAL STATEMENTS OF HAL

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 1

Need of the study:-

 To find the solvency condition of the company.

 To analyses the profitability positions of the company.

 To understand the concept of ratio analysis in detail as a part of project.

 To study the various tools of financial statements.

 To understand the process of analysis and interpretation.

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 2

 To know the financial positions, financial strength of the organization.

Scope of the study: -

 To know the financial positions, performance in ach year.

 To analyze the growth in each year.

 To know the profit made by company.

 Comparison study of all three of financial statements.

 The study helps us to know how to determine different financial statements.

Analysis and Interpretation: -

Limitations of the study: -

 The study is based on 3 years data.

 The study was based on the information provided by the company.

 The conclusion is drawn on the available information of the company.

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 3

Financial Ratios and Tools Used for Analysis

1. Profitability Ratios:Profitability ratios are a type of accounting ratio that helps in

 Gross Profit Margin= Gross Profit / Revenue

 Net Profit Margin=Net Profit / Revenue

 Return on Assets (ROA) = Net Income / Average Total Assets

 Return on Equity (ROE) = Net Income / Shareholder's Equity

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 4

 Current Ratio = Current Assets / Current Liabilities

 Quick Ratio = Current Assets – Inventory / Current Liabilities

3. Efficiency Ratios:Efficiency ratios include the inventory turnover ratio, asset

 Inventory Turnover = Cost of Goods Sold / Average Inventory

 Receivables Turnover = Net Credit Sales / Average Accounts Receivable

 Total Asset Turnover = Net Sales / Total Assets

 Interest Coverage Ratio = EBIT / Interest Expense

 Debt to Asset Ratio = Total Debt / Total Assets

Tools for Financial Analysis

 Income Statement: Provides insights into revenue, expenses, and profitability.

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 5

 Balance Sheet: Shows the company’s assets, liabilities, and equity at a

 Compares financial metrics with industry peers to assess relative

5. Common Size Analysis:

 Converts financial statement items to percentages of a base figure (e.g., total

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 6

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 7

Hindustan Aeronautics Limited (HAL)

Is an Indian public sector aerospace and defence company, headquartered in Bangalore.

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 8

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 9

Workers check new fuel tanks during World War II

HAL was established as Hindustan Aircraft Limited in

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 10

After India gained independence in 1947, the management

The total number of broad- gauge coaches manufactured by

Hindustan Aeronautics Limited (HAL) was formed on 1

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 11

Production line of the HAL Dhruv at Bangalore

During the 1980s, HAL's operations saw a rapid increase

Light Combat Helicopter induction into the Indian Army

In March 2017, HAL's chairman and managing director T

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 12

DEPARTMENT OF COMMERCE K.L.E SOCIETY’S J.G COLLEGE OF COMMERCE, HUBLI 13

Promoter holding remains unchaned @