1.

Liquidity Ratios
2. Return On Investments Ratios
3. Solvency Ratios
4. Efficiency or Turnover Ratios
5. Profitability Ratios
6. Capital Market Ratios

Liquidity Ratios:-
i. Current Ratio
ii. Quick or Acid Test Ratio
iii. Debtors Ratio
iv. Debtors Turnover Ratio
v. Creditors Ratio
vi. Creditors Turnover Ratio
vii. Inventory Holding Period
viii. Inventory Turnover Ratio

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4.1 Current Ratio (Working Capital Ratio)
= Current Assets
Current Liabilities
Table: 4.1 Current Ratio (2008 to 2012) (Rs in CRS.)

YEAR CURRENT CURRENT RATIO

ASSETS LIABILITIES

2012-13 8439.39 14362.33 0.59

2013-14 10466.63 14466.89 0.73
2014-15 10021.39 13638.30 0.73
2015-16 13730.10 16732.40 0.82
2016-17 23957.90 17842.70 1.34

Analysis: The current ratio of the company for the year 2012-13 is 0.59, 2013-14 is 0.73,
2014-15 is 0.73, 2015-16 is 0.82 and 2016-17 is 1.34, the current ratio has increased by
23.73% in the year 2013-14, and in 2014-15 it remains constant. There was increase positive
value is found by 12.33% in year 2015-16 and increased by 63.41% in the year 2016-17.

Interpretation: From the above table we can indicate that the current assets are very less
compared to current liability of the company. The company doesn’t have enough current
assets in meeting their liabilities. So, the company can’t meet immediate emergencies.

The company needs to increase current assets in order to meet its short-term obligation. We
can conclude that the ratio isn’t favorable as the current asset is less than the current
liabilities.

4.2 Quick (Acid Test or Liquid) Ratio:

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 = Quick Assets
Current Liabilities
Table: 4.2 Quick Ratio (2008 to 2012) (Rs in CRS.)

YEAR QUICK CURRENT RATIO

ASSETS LIABILITIES
2012-13 8382.53 14362.33 0.58
2013-14 10404.48 14466.89 0.72
2014-15 9994.15 13638.30 0.73
2015-16 13695.70 16732.40 0.82
2016-17 22866.90 17842.70 1.28

Analysis: The quick ratio of the company for the year 2012-13 is 0.58, 2013-14 is 0.72,
2014-15 is 0.72, 2015-16 is 0.82, and 2016-17 is 1.28. The quick ratio has increased by 24.14
% in the year 2013-14 and the year 2014-15 is increased by 1.39% there is increased positive
value is found by 12.33% for the year 2015-16 and increased by 56.10% in the year 2016-17.

Interpretation: As per as quick ratio is concern whether a firm has enough short-term
assets to cover its immediate liabilities without selling inventory. Here, Bharti Airtel review
that in 2013-14 increase their assets and then after very small percentage increase. That point
of Time it has not enough asset to cover its liabilities. Company ideal ratio is 1.5 so is below
the ratio. This is not good for company should be improving that point.

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4.3 Debtors Turnover Ratio
= Credit Sales
Avg. Debtors
Table: 4.3 Debtors Turnover Ratio (2008 to 2012) (Rs in CRS.)

YEAR CREDIT SALES AVG. DEBTORS RATIO DAYs

2012-13 25761.11 2097.49 12.28 30
2013-14 34048.32 1515.76 22.46 16
2014-15 35609.54 2327.52 15.30 24
2015-16 38015.80 2240.39 16.97 23
2016-17 41,603.80 2134.50 18.45 18

Analysis: The debtors turnover ratio of the company for the year 2012-13 is 12.28 times,
2013-14 is 22.46 times, 2014-15 is 15.30 times, 2015-16 is 16.97 times, and 2016-17 is
18.45 times the debtors turnover ratio has increased by 82.90% in the year 2013-14, and in
2014-15 it decreased by 31.88%. There was increase positive value is found by 10.92% in
year 2015-16 and increased by 8.72% in the year 2016-17.

Interpretation: Higher turnover signifies speedy and effective collection. Lower turnover
indicates sluggish and inefficient collection leading to the doubts that receivables might
contain significant doubtful debts. Receivables collection period is expressed in number of
days. Here the company in 1st year 1month to collection & after decline then after increase.
Company does not maintain lower collection period.

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Return On Investments Ratios:-
i. Return On Net Worth
ii. Earnings Per Share (EPS)
iii. Cash Earnings Per Share (CEPS)
iv. Return On Capital Employed

4.4 Return on Net Worth

PAT – Preference Dividend x 100
Net Worth
Table: 4.4 Return On Net Worth (2008 to 2012) (RS IN
CRS.)

YEAR PAT – PREFERENCE NET WORTH RATIO

DIVIDEND
2012-13 6244.19 20241.49 30.85
2013-14 7743.84 27643.97 28.01
2014-15 9426.15 36737.18 25.66
2015-16 7716.90 44111.60 17.49
2016-17 5266.00 49429.60 10.65

Analysis: The return on net worth of the company for the year 2012-13 is 30.85, 2013-14 is
28.01, and 2014-15 is 25.66, 2015-16 is 17.49, and 2016-17 is 10.65. The return on net
worth has decreased by 9.21% in the year 2013-14, and decreased by 8.39% in the year
2014-15 and again decreased by 31.84% in the year 2015-16 and again decreased by 39.11%
in the year.

Interpretation: As per as net worth ratio states the return that shareholders could receive
on their investment in a company. Here the company continuous declines year by year this
not well for company. But actually is right because bank rate is low like 12 % is good for
investors.

4.5 .09

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 PAT
No. Equity Shares
Table: 4.5 Earnings Per Share (2008 to 2011) (RS IN CRS.)

YEAR PAT NO. OF EQUITY RATIO

SHARES
2012-13 6244.19 189.79 32.90
2013-14 7743.84 189.82 40.79
2014-15 9426.15 379.75 24.82
2015-16 7716.90 379.75 20.32
2016-17 5266.00 379.75 13.87

Analysis: The earnings per share of the company for the year 2012-13 is 32.90, 2013-14 is
40.79, and 2014-15 is 24.82, 2015-16 is 20.32, and 2016-17 is 13.87. The earnings per share
has increased by 23.98% in the year 2013-14, and decreased by 39.15% in the year 2014-15
and again decreased by 18.13% in the year 2015-16 and again decreased by 31.74% in the
year 2016-17.

Interpretation: As per as EPS ratio is concern the portion of a company's profit allocated
to each outstanding share of common stock. Earnings per share serve as an indicator of a
company’s profitability. Here the company shows high profitability so it is good for
company as well as investor.

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4.6 Return on Capital Employed
PBIT
Capital Employed
Table: 4.6 Earnings Per Share (2008 to 2011) (RS IN CRS.)

YEAR PBIT CAPITAL EMPLOYED RATIO

2012-13 9450.20 56009.10 16.87
2013-14 11194.72 41776.10 26.80
2014-15 8747.65 35357.53 24.74
2015-16 7599.87 26811.63 28.35
2016-17 7514.80 11565.07 0.64

Analysis: The return on capital employed of the company for the year 2012-13 is 16.87,
2013-14 is 26.80, and 2014-15 is 24.74, 2015-16 is 28.35 and 2016-17 is 0.64. The return on
capital employed has increased by 58.87% in the year 2013-14, and decreased by 7.69% in
the year 2014-15 and increased by 14.59% in the year 2015-16 and again decreased by
97.74% in the year.

Interpretation: It is expressed as a percentage and can be very revealing about the

industry a company operates in, the skills of the management and occasionally the general
business climate. Here, the company continuous increases efficiency. It is good for the
company.

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Solvency Ratios:-
i. Net Asset Value (NAV)
ii. Debt Equity Ratio
iii. Int. Coverage Ratio
iv. Debt Service Coverage Ratio
v. Proprietary Ratio
vi. Total Assets to Debt Ratio
vii. Liabilities to Equity Ratio

4.7 Net Asset Value

Net Worth
No. Equity Share
Table: 4.7 Net Asset Value (2008 to 2012) (RS IN CRS.)

YEAR NET WORTH NO. OF EQUITY RATIO

SHARES
2012-13 20241.49 189.79 106.65
2013-14 27643.97 189.82 145.63
2014-15 36737.18 379.75 96.74
2015-16 44111.60 379.75 116.16
2016-17 49429.60 379.75 130.16

Analysis: The return on net asset value of the company for the year 2012-13 is 106.65,
2013-14 is 145.63, and 2014-15 is 96.74, 2015-16 is 116.16, and 2016-17 is 130.16. The net
asset value has increased by 36.55% in the year 2013-14, and decreased by 33.57% in the
year 2014-15 and again increased by 20.01% in the year 2015-16, and again increased by
12.05% in the year 2016-17.

Interpretation: The net asset value in companies is the book value deducting liabilities
and intangible assets from the total assets. For companies, the net asset value is always used
in market book ratio or price book ratio to compare the net asset value of the company with
its market value. Here condition of company is good due to high profitability.

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4.8 Debt Equity Ratio
Long Term Debt
Share Holder Fund
Table: 4.8 Debt Equity Ratio (2008 to 2012) (RS IN CRS.)

YEAR LONG TERM DEBT SHARE RATIO

HOLDER FUND
2012-13 6570.43 20241.49 0.32
2013-14 7713.65 27643.97 0.29
2014-15 5038.92 36737.18 0.14
2015-16 11897.50 44111.60 0.27
2016-17 14129.40 49429.60 0.28

Analysis: The debt equity ratio of the company for the year 2012-13 is 0.32, 2013-14 is
0.29, and 2014-15 is 0.14, 2015-16 is 0.27, and 2016-17 is 0.28. The debt equity ratio has
decreased by 9.38% in the year 2013-14, and decreased by 51.72% in the year 2014-15,
increased by 92.29% in the year 2015-16 and again increased by 3.70% in the year 2016-17.

Interpretation: A measure of a company's financial leverage calculated by dividing its

total liabilities by stockholders' equity. It indicates what proportion of equity and debt the
company is using to finance its assets. Here the company ratio so good in the current
situation as to the previous years. This is good for the company.

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4.9 Proprietary Ratio
Proprietary Fund
Total Asset
Table: 4.9 Proprietary Ratio (2008 to 2012) (RS IN CRS.)

YEAR PROPRIETARY TOTAL ASSET RATIO

FUND
2012-13 20241.49 26811.84 0.75
2013-14 27643.97 35357.62 0.78
2014-15 36737.18 41776.12 0.88
2015-16 44111.60 56009.10 0.79
2016-17 49429.60 63559.00 0.78

Analysis: The proprietary ratio of the company for the year 2012-13 is 0.75, 2013-14 is
0.78, and 2014-15 is 0.88, 2015-16 is 0.79, and 2016-17 is 0.78. The proprietary ratio has
increased by 4.00% in the year 2013-14, and increased by 11.54% in the year 2014-15 and
decreased by 10.23% in the year 2015-16 and again decreased by 1.27% in the year 2016-17.

Interpretation: Proprietary Ratio refers to a ratio which helps the creditors of the
company in seeing that their capital or loans which the creditors have given to the company
are safe. Ideal ratio is <1 so Here company has all year is <1 so it is good for company.

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4.10 Total Asset to Debt Ratio
Total Asset
Long Term Debt
Table: 4.10 Total Asset to Debt Ratio (2008 to 2012) (RS IN CRS.)

YEAR TOTAL ASSET LONG TERM RATIO

DEBT
2012-13 26811.84 6570.43 4.08
2013-14 35357.62 7713.65 4.58
2014-15 41776.12 5038.92 8.29
2015-16 56009.10 11897.50 4.71
2016-17 63559.00 14129.40 4.50

Analysis: The total assets to debt ratio of the company for the year 2012-13 is 4.08, 2013-
14 is 4.58, and 2014-15 is 8.29, 2015-16 is 8.71, and 2016-17 is 4.50. The total asset ratio
has increased by 12.25% in the year 2013-14, and increased by 81.00% in the year 2014-15
and decreased by 43.18% in the year 2015-16 and again decreased by 4.46% in the year
2016-17.

Interpretation: As per as the total asset to debt ratio to debt ratio is concern ratio
between asset & long term debt. In the ratio total asset more than long term debt. So
here company total asset is high in 2014-15 but company can’t maintain that so
improve that point is actually it is good.

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4.11 Liabilities to Equity Ratio
Total Liabilities
Share Holders Equity
Table: 4.11 Liabilities to Equity Ratio (2008 to 2012) (RS IN CRS.)

YEAR TOTAL SHARE HOLDERS RATIO

LIABILITIES EQUITY
2012-13 26811.84 20241.49 1.32
2013-14 35357.62 27643.97 1.28
2014-15 41776.12 36737.18 1.14
2015-16 56009.10 44111.60 1.27
2016-17 63559.00 49429.60 1.28

Analysis: The liabilities to equity ratio of the company for the year 2012-13 is 4.08, 2013-
14 is 4.58, and 2014-15 is 8.29, 2015-16 is 8.71, and 2016-17 is 1.28. The liabilities to
equity ratio has decreased by 3.03% in the year 2013-14, and decreased by 10.94% in the
year 2014-15 and increased by 11.40% in the year 2015-16 and again increased by 0.79% in
the year 2016-17.

Interpretation: The liability to equity ratio is the relationship between the capital
contributed by creditors and the capital contributed by shareholders. It also shows the extent
to which shareholders' equity can fulfill a company's obligations to creditors in the event of
liquidation. Here the company increases their equity year by year. Ideal ratio is 1 here
company is work on more than 1 so it is good for the company.

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