PROJECT REPORT ON

“RATIO ANALYSIS OF THINK NEXT TECHNOLOGIES PVT LTD”

IN PARTIAL FULFILMENT OF THE REQUIREMENT FOR THE DEGREE OF

BACHELORS OF BUSINESS ADMINISTRATION (BBA)

(2021-2024)

SUBMITTED TO: Submitted By:

Dr. Amitabh Mishra Hritik Sood

BBA 5th Semester

UID-21BBA1192

CHANDIGARH UNIVERSITY

(PUNJAB)
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DECLARATION

I Hritik Sood declare that I myself worked on the topic “RATIO ANALYSIS” under ThinkNEXT
Technologies Pvt Ltd. Mohali submitted by me towards partial fulfillment of my Project under the
guidance of MR Amitabh Mishra project guide is an original work done by me and it has not been
submitted to any other university or published any time before.

Place: Mohali

Date:
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CERTIFICATE
TO WHOM IT MAY CONCERN
This is to certify that the project titled RATIO ANALYSIS OF ThinkNEXT Technologies Pvt.
Ltd., Mohali is the original work carried out by the me submitted to Chandigarh University
Mohali, Punjab under the supervision of Dr. Amitabh Mishra submitted in partial fulfillment for
the award of Bachelors in Business Administration.

This project was completed within the stipulated time period as per the statues of the university.

It is further certified that this work has not been submitted earlier in this university or any other
university for any degree/diploma.

Guide Branch Head

_______________ _________________

Place: Mohali

Date:
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Certificate by company
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ACKNOWLEDGMENT
First of all I would like to express my deepest gratitude to Almighty GOD who bestowed his
blessings on me and gave me the courage and right type of environment for the completion of my
project. I owe a deep sense of indebtedness to my family which has always been a perennial
source of inspiration for me.
I am very thankful to my project guide Dr. Amitabh Mishra for providing me with the handful
information required for the successful completion of the project.

I am deeply grateful to CA Kaushal for their everlasting support or guidance on the ground of
which I have acquired a new field of knowledge the course structure created for curriculum has
benefited with inclusion of recent development in an organizational & management aspect.

I would also like to thank my college project guide Ms. Deepti Sharma she has been my mentor
for this project. It was only through her excellence assistance & good suggestions that I have
been able to complete this project.

Last but not the least; I would like to thank all the employees of ThinkNEXT Technologies Pvt.
Ltd. Mohali who has given me valuable information in the part of my project. Above all, I
would like to thank all contacted persons of firm who took out their valuable times to answer my
queries & give me full information related to my project.

Hritik Sood
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PREFACE
This Project Report has been prepared in partial fulfillment of the requirement for the Subject:
Bachelor of Business Administration on Ratio Analysis in the academic year 2019-2020.

Managing finance in today’s dynamic environment is becoming more and more complex as well
as important. My project deals with “Ratio analysis” in ThinkNEXT. In this report, I have studied
to access the quality of income in ThinkNEXT.

The first section of my report deals with a detailed company profile. It includes company’s
activities, its working capital, its strengths, and organizational structure etc. This section attempts
to give detailed information about the company and the nature of its functioning.

The second section deals with working capital. In this I have given brief introduction about the
Finance and a brief conceptual explanation to Ratio analysis

In the third section of my project report, I have conducted the study in ThinkNEXT on the working
capital. This section also contains findings, conclusion, and suggestions. The fourth and final
section of this report consists of extra information and annexure.

(Hritik Sood)
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LIST OF CONTENTS

Chapters Topics Page No.

Chapter-1 Introduction 9-15
1.1 Introduction about the Industry
1.2 Company Profile
1.2.1 Services
1.2.2 Vision
1.2.3 Mission
1.2.4 Quality Policy
Chapter-2 2.1 Introduction to Project 16-24
2.1 Introduction to ratio analysis
2.2 Meaning
2.3 Financial Analysis
2.4 Parties Interested in Financial
Analysis
2.5 Importance of Ratio analysis
2.6 Limitations of ratio analysis
2.7 Classifications of Ratios
A. Liquidity Ratios
B. Activity Ratio
C. Solvency Ratio
D. Profitability Ratio
E. Overall Profitability Ratio
2.8 Objectives of Ratio Analysis
2.9 Scope of ratio Analysis
Chapter-3 Review Of Literature 25-26
3.1 Literature review of history of
Ratio Analysis
Chapter-4 Research Methodology 27-28
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5.1 Research methodology

5.1.1 Research
5.1.2 Research Plan
5.1.3 Research methodology
5.1.4 modes of data collection
Chapter-5 Analysis And Interpretation 29-37
5.1 Liquidity Ratio
5.2 Activity Ratio
5.3 Findings
5.4 Conclusions
Bibliography And References 38
Annexures 39-50
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CHAPTER-1

INTRODUCTION

1.1 INTRODUCTION ABOUT IT INDUSTRY

Information Technology covers a broad spectrum of hardware and software solutions that
enable organizations to gather, organize, and analyze data that helps them achieve their goals.
It also details technology-based workflow processes that expand the capacity of an
organization to deliver services that generate revenue. The four main focuses of IT personnel
are business computer network and database management, information security, business
software development, and computer tech support.

As the IT industry evolves to meet the technology demands of today’s workplace, different
challenges are arising and IT professionals are striving to meet them. Network security is by
far the greatest concern for many companies and they rely on their IT staff to prevent or stop
these system breaches. Data overload is becoming an increasingly important issue since many
businesses are processing large amounts of data on a daily basis, with many of them not have
the processing power to do so. Last, but not least, two of the most essential skills needed from
IT professionals are teamwork and communication skills. Systems are complex and people are
needed to help translate that task. Therefore, IT professionals are the ones responsible for
helping others get their work done efficiently without the complex jargon of the technology
world.

Let’s talk about careers for a moment. Employment for information technology and related
services are projected to grow rapidly over the next decade, outpacing similar professional,
scientific, and technical industries, as well as the economy as a whole. According to the
Bureau of Labor Statistics (BLS), “output in computer systems design and related services is
expected to grow at an average annual rate of 6.1 percent [between 2010 and 2020], compared
with 3.6 percent for the broad industry category—professional, scientific, and technical
services—and 2.9 percent for all industries.” Compared to 2.6 percent for professional,
scientific, and technical services and 1.3 percent for all other industries, that’s a huge demand
coming up! Why is this happening?
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Because the necessity for information technology is king. With the emerging popularity of the
Cloud technology, many organizations are taking this up as an alternative to actual hardware
using up space. Cloud computing service providers manage IT infrastructure and platforms,
and provide businesses with access to remote data storage and software packages.

Another reason for the rise of IT careers is the need to defend our information systems from
countless attacks. Just in the past few years alone, the BLS reports “there is a 17-fold increase
in the number of cyber-attacks on U.S. infrastructure between 2009 and 2011”. Security
companies also have produced reports that show large increases in security breaches on
private businesses in those years as well.

With the increasing need for IT professionals, this seems to be one of the more stable careers
for the next decade. One of the first steps to becoming an IT professional is to obtain a degree
or certification in computer or management information systems. Then you must decide which
field to go into, as there are many in the IT universe.

Here are some of the most popular positions for people interested in Information Technology:

1.Computer Systems Analyst.

In this position, analysts design and develop computer systems and are an expert at every facet
of hardware, software, and networks. Analysts also evaluate the systems and research the
industry for better products to enhance their existing system.

2.Cloud Specialist.
Cloud specialists organize and give configuration to the information infrastructure in the sky.
Because this is still an emerging technology, these architects are highly sought after and one
of the top-paying professions in the industry.

3. Computer Forensic Investigator.

These investigators are computer crime detectives that search for, identify, and evaluate
information from computer systems.

4. Health IT Specialist.
Health IT is booming, especially with Affordable Care Act coming on and transition from
paper to electronic health records. Health IT specialists will mix computer knowledge will
record-keeping skills, medical coding, and billing.

5. Database Administrator.
Database administrators create, upgrade, and test for databases.

6. Web Developer.
Web developers are in high demand because they have a great understanding of what makes a
good operating system. They create web pages, web applications and web content with their
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knowledge of what the average surfer finds visually stimulating and how to optimize sites for
mobile tech, among numerous other skills.

7. IT Manager.
These managers are the contact pros when your email won’t send or Microsoft Word doesn’t
open. As the head of the IT department, they ensure that a company’s network is operating
smoothly and that dangerous threats like malware are minimized.

8. Information Technology Vendor Manager.

Slightly more hands-off compared to some tech positions, vendor managers oversee supply
when it comes to software and hardware. This can mean anything from Microsoft’s latest word
processor to health IT programs for hospitals.

9. Computer Systems Administrator

The expertise of network and computer systems administrators is essential to every office.
Aside from maintaining a healthy computer network, they also lend their tech knowledge to
managing telecommunication networks. This profession is expected to add 96,600 new
positions by 2020!

10. Mobile Application Developer.

Because of our highly-mobile lifestyle, mobile application developers are and will be in high
demand for years to come, especially as mobile devices and technology becomes increasingly
sophisticated.
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1.2 COMPANY PROFILE

ThinkNEXT Technologies Private Limited (Formerly Brilliant Software Solutions) is an ISO

9001:2008 certified software development company founded in August 2009 and it is approved
from Ministry of Corporate Affairs which deals in University/College/School ERP Solutions,
Android /iPhone Applications development, Web designing, Web development, Discount Deals
(www.thinknextcard.com, www.tricitydeal.com), Bulk SMS, Voice SMS, Bulk Email, Biometric
Time Attendance, Access Control, SEO/SMO, Database Solutions, Payment Gateway Integration,
E-Mail Integration, Industrial Training, Corporate Training and Placements etc. ThinkNEXT
Technologies provides software solutions using latest technologies e.g. Smart Card, NFC,
Biometrics, GPS, Barcode, RFID, SMS, Auto SMS (Short code), Android, iPhone, Web, Windows,
and Mobile based technologies

ThinkNEXT has wide expertise in .NET, Crystal Reports, Java, PHP, Android, iPhone, Databases
(Oracle and SQL Server), Web Designing, Networking, Web Server configurations, various RAID
Levels etc.

ThinkNEXT Technologies has also setup its offices in USA, Delhi, Shimla, and Bathinda for its
software support. ThinkNEXT has its own multiple Smart Card printing, encoding and barcode
label printing machines to provide better and effective customer support solutions. ThinkNEXT
has also setup its own placement consultancy and is having numerous placement partner companies
to provide best possible placements in IT industry.

ThinkNEXT Technologies has developed for the first time in northern region cloud computing-
based Cloud Campus 4.0 to facilitate knowledge and placement centric services. It is a unique
concept for effective and collaborative learning.

1. ThinkNEXT deals exclusively in campus automation through Smart Campus ERP

Solutions. Therefore we have better experience in handling large group of institutions
through proper time-tested policies and procedures.
2. First Company of India who has Launched NFC Technology (The Future) for Smart
Campuses through NFC Smart Cards.
3. First Company of India who has launched Android Version of Smart Campus ERP
Solutions for Mobiles and Tablet PCs.
4. First company of India who has developed SMS Opt-In Technology so that
Institutes/Colleges can send Transactional SMS with SMS Sender ID and without SMS
Template approval.
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5. First company of Punjab, Haryana, Himachal, J&K (Northern region) who launched Smart
Cards (Contact Type), Smart Cards (Contactless) in Punjab for campus automation.
6. First company of India which has launched its ThinkNEXT Smart Card as Discount Card
in more than 120 enterprises.
7. Established own multiple Smart Card Designing, Smart Card Printing, Smart Card
Lamination and Oyster Barcode Printing Units.
8. Multiple SMS Gateway Support.

1.2.1 SERVICES:
We provide Software Solutions using latest technologies or features:
 NFC
 Biometrics (Fingerprint with Automated Online)
 Smart Card
 Barcode
 RFID
 SMS
 Short code 56767 (Auto SMS)
 Android
 ions (phone)
 GPS
 WAP (For WAP Enabled Mobile Phones)
 Multiple SMS Gateway Support
 Web based Technologies (365x24x7 services)
 Windows based Technologies
 Mobile based Technologies
 Webcam support for various operations
 Parallel Internet, Intranet and Wi-Fi Support

1.2.2 Vision:

ThinkNEXT Technologies Pvt. Ltd. are already very flexible and scalable. Still, we always
take care of specific requirements of our clients. Our highly committed R&D team makes
our software feature rich, dynamic and future tuned everyday so that our clients always
maintain the lead over their competitors. The development of the software is being done
and the purpose full customization of the package is carried out in the ThinkNEXT lab.
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1.2.3 Mission:

ThinkNEXT is pioneer in Smart Campus ERP Solutions for

Universities/Colleges/Schools using latest technologies and features. We provide software
solutions using .NET, PHP, Android, iphone, Java technologies with threetier-architecture
support. We provide back-end solutions using MS SQL Server, Oracle, and MySQL.

1.2.4 Quality Policy:

We have wide experience working with eminent Educationists, Managements, Directors,

Principals, Head of Departments, other Staff Members, Parents, and students. Therefore we
do not sell only software Modules but an innovative system which has more importance
than just ERP software modules. Today Smart Campus solutions are a need of hour for
every University/Group of Colleges or an Institution to make edge over others and maintain
a lead over their competitors. Our Research and Development team is committed to make
your institute(s) to maintain lead over their competitors.
More Services:

 ThinkNEXT offers various industry-ready programs so that student needs not to

struggle for jobs. ThinkNEXT offers 6 weeks/2 Months/6 Months training programs
to make students industry.
 ThinkNEXT is pioneer in providing best placements in Industry. We offer minimum
five job interviews for each student and provide 100% Placement Assistance.
 ThinkNEXT Offers Life-Time Validity Learning and Placement Card. Students
undergoing six months training will have advantage to learn free of cost anything
against that training program for life-time.
 ThinkNEXT offers Part-Time/Full Time Job Offer for each student during training
so that students can earn while they learn. Student can bear their food,
accommodation, and other expenses on.\
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CHAPTER – 2
INTRODUCTION TO PROJECT
2.1 INTRODUCTION TO RATIO ANALYSIS

Financial analysis has a very broad scope. One aspect looks at the general (qualitative) factors of a
company. This means crunching and analysing numbers from the financial statement. If used in
conjunction with other method, quantitative analysis can produce excellent results.

Ratio analysis is not just comparing different numbers from the balance sheet, income statement
and cash flow statement. It is comparing the number against previous years, other companies, the
industry or even the economy in general. Ratio look at the relationship between individual values
and relate them to how a company has performed in the past, and how it might perform in the
future.

For example, current assets alone do not tell us a whole lot, but when we divide them by current
liabilities, we are able to determine whether the company has enough money to cover short-term
debts.

In this tutorial, we will show you how to use ratio analysis. Valuing a company is no easy task.
This tutorial will shed some lights on how it can be done and, ultimately, help you to make more
informed choices as an investor.

2.2 MEANING

Meaning of ratio: Relationship between two figures, expressed in arithmetical terms is called a
‘ratio.’

In the words of R.N. Anthony, “A ratio is simply one number expressed in terms of another. It
is found by dividing one number into other.”

According to Myers, “Ratio analysis is the study of the relationship between various items or
group of items in financial statements.”
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Quantitative analysis of information contained in a company’s financial statements. Ratio analysis

is based on line items in financial statements like the balance sheet, income statement and cash
flow statement; the ratio of one item-or a combination of items – or combination are then
calculated. Ratio analysis is used to evaluate various aspects of acompany’s operating and financial
performance such as its efficiency, liquidity, profitability, and solvency.

2.3 FINANCIAL ANALYSIS

Financial analysis is the process of identifying the financial strengths and weakness of the firm. It
is done by establishing relationships between the items of financial statements viz., balance sheet
and profit and loss account. Financial analysis can be undertaken by management of the firm, viz.,
owners, creditors, investors, and others.

2.4 PARTIES INTERESTED IN FINANCIAL ANALYSIS

The users of financial analysis can be divided into two broad groups.

INTERESTED PARTIES

INTERNAL PARTIES EXTERNAL PARTIES

 Internal users
1. Financial executives
2. Top management
 External users
1. Investors
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2. Creditor.
3. Workers
4. Customers
5. Government
6. Public
7. Researchers
2.5 IMPORTANCES OF RATIO ANALYSIS
Ratio analysis is an important tool for analysing the company's financial performance. The
following are the important advantages of the accounting ratios.

1. Analysing Financial Statements: - Ratio analysis is an important technique of financial

statement analysis. Accounting ratios are useful for understanding the financial position of
the company. Different users such as investors, management. Bankers and creditors use the
ratio to analyse the financial situation of the company for their decision-making purpose.
2. Judging Efficiency: - Accounting ratios are important for judging the company's efficiency
in terms of its operations and management. They help judge how well the company has
been able to utilize its assets and earn profits. This helps the management to assess financial
requirements and the capabilities of various business unites.
3. Locating Weakness: - Accounting ratios can also be used in locating weakness of the
company's operations even though its overall performance may be quite good. Management
can then pay attention to the weakness and take remedial measures to overcome them. For
examples, if a firm that increases in distribution expenses is more than proportionate to the
result expected or achieved, it can take remedial steps to overcome this adverse situation.
4. Formulating Plans: - Although accounting ratios are used to analyse the company's past
financial performance, they can also be used to establish future trends of its financial
performance. As a result, they help formulate the company's future for example, expenses
as a percentage of sales can be easily forecasted based on sales and expenses of the past
years.
5. Comparing Performance: - It is essential for a company to know how well it is performing
over the years and as compared to the other firms of the similar nature. Besides, it is also
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important to know how well its different divisions are performing among themselves in
different years. Ratio analysis facilitates such comparison.
6. Simplifying Accounting Figures: - Accounting ratios simplify, summaries and
systematize the accounting figures to make them more understandable and in lucid form.
They highlight the inter-statements which exists between various segments of the business
as expressed by accounting statement. Often the figures standing alone cannot help them
convey any meaning and ratios help to relate with other figures.
2.6 LIMITATIONS OF RATIO ANALYSIS

Ratio Analysis is a useful technique to evaluate the performance and financial position of any
business unit but it does sufferfrom a number of limitations. These must be kept in mind while
analyzing financial statements.

1. Historical Analysis: -Ratio Analysis is historical in nature of the financial

statement on the basis of which ratios are calculated are historical in nature.
2. Price Level Change: - Changes in price level often make comparison of figures of
the previous years difficult. E.g. ratio of sales to fixed assets in 2006 would be
much higher than in 2000 due to rising prices, fixed assets being expressed on
cost.
3. Not Free from bias: - In many situations, the accountant has to make a choice out
of the various alternatives available. E.g. choice of the method depreciation,
choice in the method of inventory valuation etc. Since there is a subjectivity
inherent in the choice, ratio analysis cannot be said to be free from bias.
4. Window dressing: -Window dressing is slowly the position better than what it is.
Some companies, in order to cover up their bad financial position resort to
window dressing. By hiding important facts, they try to depict a better financial
position.
5. Qualitative factors ignored: - Ratio Analysis is a quantitative analysis. It ignores
qualitative factors like debtors’ character, honesty, past record etc.
6. Different accounting practices render ratios incomparable: - The result of two
firms is comparable with the help of accounting ratios only if they follow the same
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accounting methods. E.g. if one firm changes depreciation on straight line method
while another is charging on diminishing balance method, accounting ratios will
not be strictly comparable.
2.7 Classification of Ratios

A. Liquidity Ratio:
Liquidity refers to the ability of a concern to meet its current obligations and when these
become due. The short-term obligations are met by realizing amounts from current, floating
or circulating assets. The current assets should either be liquid or near liquidity. These
should be convertible into cash for paying obligations of short-term nature. To measure
liquidity of a firm, following ratios can be calculated.

I. Current Ratio
II. Quick or Acid test or Liquid ratio
1. Current Ratio:
Current Ratio may be defined as the relationship between current assets and current
liabilities. This ratio, also known as working capital ratio, is a measure of liquidity and is
most widely used to make the analysis of short-term financial position, it is calculated with
the help of following formula:

Current Ratio = Current Assets

Current Liabilities

2. Quick / Liquid / Acid test ratio:

Quick ratio as known as acid test or liquid ratio is more rigorous test of liquid than the
current ratio. The term ‘liquidity’ refers to the ability of a firm to pay short-term obligations
as and when they become due. An asset is said to be liquid if it can be converted into cash
within a short period without loss of value. Quick ratio can be calculated with the help of
following formula:
Quick ratio = Quick or liquid assets
Current liabilities
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B. Activity Ratios

Funds are invested in various assets in business to make sales and earn profits. The
efficiency with which assets are managed directly affects the volume of sales. The better
the management of assets, the larger is the amount of the sales and the profits.
Activity ratios measure the efficiency or effectiveness with which a firm manages its
resources or assets. These ratios are also called turn over ratios because they indicate the
speed with which assets are converted or turned over into sales. Current ratio and acid test
ratio ignore the movement of current assets, it is important to calculate the following
turnover or efficiency ratios to comment liquidity or the efficiency with which the liquid
assets are being used by the firm.

I. Inventory / stock turnover Ratio

II. Working capital turnover Ratio

1. Inventory Turnover Ratio:

Every firm must maintain a certain level of inventory of finished goods to be able to meet
the requirements of business. But the level of inventory should be neither is too high too
low. Inventory turnover ratio also known as velocity ratio. It would indicate whether
inventory has been efficiently used or not. The purpose is to see whether the required
minimum funds have been locked up in inventory.

Inventory Turnover Ratio = Cost of Goods Sold

Average Stock

2. Working Capital Turnover Ratio:

Working capital turnover ratio indicates the velocity of utilization of net working capital.
This ratio indicates the number of times the working capital is turned over in a year. The
ratio measures the efficiency with which working capital is used by the firm.

Working Capital Turnover Ratio = Cost of Sales

Average Working Capital
C. Solvency Ratio
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The ‘term solvency’ refers to the ability of a concern to meet its long-term obligations. The
long-term indebtedness of a firm includes debenture holders, financial institutions
providing medium- and long-term loans and other credit selling goods on instalment basis.
Long term solvency ratios indicated a firm’s ability to meet the fixed interest and costs and
repayment schedules associated with its long borrowings. The following ratios serve the
purpose of determining the solvency of the concern.

I. Debt - Equity Ratio

II. Proprietary Ratio
III. Fixed Asset to Total Long-term Funds

1. Debt – Equity Ratio:

Debt – Equity Ratio, also known as External – Internal Ratio it is calculated to measure the
relative claims of outsider and the owners (i.e., shareholders) against the firm’s assets. This
ratio indicates the relation between the external equities or the outsider’s funds and the
internal equities or the outsider’s funds and the internal equities or the shareholder’s funds,
thus:

Debt – Equity Ratio = Debt

Equity

Debt = W.C.L. + Term Loans

Equity = Equity + Reserves & Surplus + Profit

2. Proprietary or Equity Ratio:

A variant to the debt - equity ratio is the proprietary Ratio. This ratio establishes the
relationship between shareholder’s funds to the total assets of the firm. It is an important
ratio for determining long – term solvency of a firm. The ratio can be calculated as under.

Proprietary Ratio = Shareholder’s Fund

Total Assets
Proprietary Ratio = Equity + Preference + Reserve & Surplus
Total Assets = Fixed Assets + Current Assets

3. Fixed Asset to Total Long-term Funds

A variant to ratio of fixed assets to net worth is the ratio of fixed assets to total long-term
funds which are calculated as:
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Fixed Assets Ratio = Fixed Assets

Total long-term funds
Long term funds = Shareholder’s + long – term borrowings

D. Profitability Ratios:
The primary objective of a business undertaking is to earn profits. Profit earning is
considered essential for the survival of the business.
In the words ofLord Keynes, “Profit is the engine that drives the business enterprise.” A
business needs profits not only for its existence but also for expansion and diversification.
Profits are, thus, a useful measure of overall efficiency of business. The various profitability
ratios are discussed below:

(A) General Profitability Ratios

I. Gross profit Ratio

II. Operating profit Ratio
III. Net profit Ratio

1. Gross Profit Ratio:

Gross profit Ratio indicates the extent to which selling prices of goods per
unit may decline without resulting in losses on operations of a firm. It
reflects the efficiency with which a firm produces its products. It measures
the relationship of gross profit to net sales and it is usually represented as
percentage. It is calculated as per following formula:

Gross Profit Ratio = Gross Profit * 100

Net Sales
2. Operating Profit Ratio:
Operating Ratio measure the cost of operations per rupee of sales. It
establishes the relationship between cost of goods sold and other operating
expenses on the one hand and the sales on the other hand and generally
represented as a percentage.

Operating Profit Ratio = Operating Cost * 100

Net Sales

Operating Profit Ratio = Cost of Goods Sold + Operating expenses

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3. Net Profit Ratio:

Net profit ratio establishes a relationship between net profit (after tax) and
sales, and indicates the efficiency of management in manufacturing, selling,
administrative and other activities of the firm. It is calculated as:

Net Profit Ratio = Net profit after tax * 100

Net Sales

or

Net Profit Ratio = Net operating profit * 100

Net Sales

E. Overall Profitability Ratios

Profits are measure of overall efficiency of a business. Overall profitability or efficiency
of a business can be measured in terms of profits related to investments made in the
business. Various overall profitability ratios are discussed below:

I. Return on Shareholder’s Investment or Net Worth Ratio

II. Return on Equity Capital
III. Earnings Per Share
IV. Capital Turnover Ratio

1. Return on Shareholder’s Investment Ratio:

This Ratio is popularly known as ROI is the relationship between the net profits are interest
on the long-term borrowings and income tax, because those will be the only profits
available for shareholder’s and the proprietor’s funds. Thus:

Return on Shareholder’s Investment = Net Profit (Before Interest & Tax)

Capital Employed

Capital Employed = Fixed Assets + Current assets – Current Liabilities

2. Return on Equity Capital:

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In real sense, ordinary shareholders are the real owners of the company. They assume the
higher risk in the company. Thus, they are more interested in the profitability of the
company and performance of a company should be judged based on return on equity capital
of the company. Return on equity is the relationship between profits of a company and its
equity capital can be calculated as:

Return on Equity = Net profit after tax – preference dividend

Equity shareholders fund
3. Earnings per Share:
Earnings per share are a small variation of return on equity capital and good measure of
profitability. It is calculated with the following formula:
Earnings per Share = Net profit after tax – Preference Dividend
N. of Equity Shares

4. Capital Turnover Ratio:

This Ratio is calculated to measure the efficiency or effectiveness with which a firm utilizes
its resources or the capital employed.
Capital Employed = Fixed assets + Working Capital

Capital Turnover Ratio = Cost of Goods Sold or Sales

Capital Employed

2.8 OBJECTIVES OF RATIO ANALYSIS

Analysis of financial statements may be made for a particular purpose in view.

 To find out the financial stability and soundness of the business enterprise.
 To assess and evaluate the earning capacity of the business.
 To estimate and evaluate the fixed assets, stock etc., of the concern.
 To estimate and determine the possibilities of future growth of business.
 To assess and evaluate the firm’s capacity and ability to repay short-term and long-term
loans.
 To help in decision making and control.
 To make inter-firm comparison.
 To identify the reasons for change in profitability and financial positions of the firm.
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2.9 SCOPE OF RATIO ANALYSIS

 Helps in decision making.

 Helps in financial forecasting.

 Helps in communicating.

 Helps in co-ordination.
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CHAPTER – 3

REVIEW OF LITERATURE

3.1 LITERATURE REVIEW OF HISTORY OF FINANCIAL RATIOS:

In the beginning of nineteenth century essential improvement in ratio analysis occurred. In this
period few developments are endogenous. First, large number of ratios was conceived in
comparison to earlier periods. Second, proper ratio criteria were appeared. In this regard most
famous was current ratio criterion. Third, different analysts understand the need of inter-firm
analysis and for that purpose it felt the need for relative ratio criterion. Despite these
developments ratio analysis has been used for analysis in this period and those felt the need of
using ratio analysis only used current ratio.

Two very important exogenous developments in this period because of which need of ratios has
surfaced were federal income tax code in 1913 and the establishment of the Federal Reserve
System in 1914. These two developments also helped to improve the content of financial
statements as well as increased the demand of financial statements.

In 1920s, interest in ratio analysis increased dramatically. Many publications on the topic of ratio
analysis published during this period. Different credit agencies, trade unions, universities and
individuals seeking analyses compiled industry data on ratio analysis.

Justin (1924) argued that the method of gathering industry data and calculates averages were
called “Scientific ratio analysis”. The word “scientific” in this title was not entirely correct
because no evidence had been found that the hypothesis formulation and hypothesis testing
actually carried out.

Horrigan (1968) says ratios analysis has come into existence since early ages and the main reason
of the development of ratio analysis was its use in the analysis of the properties of ratios in 300
B.C. in recent time it is used as a standard tool for the analysis of financial statement. In
nineteenth century main reasons of using ratio analysis are power of financial institutions and
shifting of management to professional managers. Ratio analysis used for two purposes that are
credit and managerial. In managerial approach profitability and in credit approach capacity of
firm to pay debts is the main point of focus. Generally, ratio analysis is used credit analysis.

There was rapid expansion of financial knowledge in nineteenth century and to study this rapidly
expanding knowledge analyst first compared similar items then moved further and compared
current assets and liabilities as well with other ratios. In that period current ratio was the most
significant ratio among all other available ratios. To analyze the operating results DuPont
 P a g e | 28

analysis is also used. The result divided into three parts and then compared with other companies
to point out the problem and strong areas of business.

Bliss (1923) says basic relationship within the business is indicated by the ratios and developed
complete model based on the ratios. The purpose model was not mature but inspired others to
start working on this theory.

Different critics of ratio analysis also appeared. Gilman (1925) has following concerns on ratio
analysis (1) ratios are bond with time and changed as time passed so cannot be interpreted (2)
ratios are not natural measure for judging the performance companies manipulated them (3) ratios
easily affect the mind of viewers and hide the actual position and (4) ratios swing widely that also
affect the dependability.

Foulke (1931) create and promoted own set of financial ratios successfully. This set of financial
ratios was printed and promptly known as important and prominent group of ratios.

Fitzpatrick (1932) with the help of thirteen different type of ratios analysis 120 failed firms and
found that three out of thirteen ratios predict the failure of firms with precise accuracy while
other ratios also shown some prediction power.

Rasmer and foster (1931) used eleven ratios to examine that the successful firms have higher
ratios than unsuccessful firms. Although this study was immature but immaturity was ignored by
considering the vital contribution this study has in the evaluation of usefulness of ratios. Security
and exchange commission of America was formed in 1934. This also expands the flow and
number of financial statements and with the help of this peripheral factor importance of ratio
analysis further enhanced and realized.

Marwin (1942) by using several ratios analyze financial trends of huge successful and
unsuccessful firms. Compared normal ratios of industry with mean ratios of large unsuccessful
firms and find out that the three ratios current ratio, net working capital to total assets and net
worth to debt were able to foresee failure before actual failure happened. This study shows the
actual power of prediction of ratio analysis and results were still reliable.

Walter (1957) included cash flow statement items in ratio analysis. At the end of world war fund
statement came into existence and with fund statement fund statement ratios was also produced.

Hickman (1958) used times interest earned ratio and net profit ratio to predict the default rate on
corporate bond.

Saulnier (1958) says firms with low current ratio and debt ratio has greater chance to default then
firms with high ratios.

Moore and Atkinson (1961) point out the relationship between capacity to pay and financial
ratios and shows results of ratio analysis influence the borrowing ability of firms.
 P a g e | 29

Beaver (1967) also examined the prediction power of ratio analysis and point out ratios ability to
predict failure as early as five years before the collapsed. Statistical technique used in the study
was more powerful than earlier studies and fund statement data was used to calculate ratio. This
study set the foundation for future research on ratio analysis.

Sorter and Becker (1964) examined the relationship between psychological model and corporate
personality of financial ratios and find out that long-established corporation maintain greater
liquidity and solvency ratios.

Gombola and Ketz (1983) found that the fund and income statement are produced for different
purpose and profitability ratios did not has the information that cash flow ratios provide. In other
words both ratios gave important as well as different information from one and other.
 P a g e | 30

CHAPTER-4

RESEARCH METHODOLOGY
4.1 Research
Research in common parlance refers to research for knowledge. It is also defined as a scientific
and systematic search for pertinent information collection on a specific topic. In fact, it is an art of
scientific investigation. Research is not only concerned to the decision of the fact but also building
up to date knowledge and to discover the new facts involved through the process of dynamic change
in the society.

4.2 Research Plan

The research study is exploratory in nature. The established objectives were kept in mind during
the study; however, no hypothesis was formed as the study was more in the form of descriptive
design attempting to analyse the attitude of respondents towards the project.

4.3 Research methodology

Research methodology is the process used to collect the data and others types of information for
use in making business decisions. Examples of these types of methodology include interviews,
surveys, and research of publications. All these types include the use of present and historical
information.

Data collection: -

The methodology, I have adopted secondary data collection for my study and the various tools for
secondary data collection are: -

1. Consolidated Balance Sheets of two financial years

2. Consolidated P/L Accounts of two financial years
3. Ratio Analysis
4. Fund Flow Analysis
The above parameters are used for critical analysis of financial position. With the evaluation of
each component, the financial position from different angles is tried to be presented in well and
systematic manner. By critical analysis with the help of different tools, it becomes clear how the
financial manager handles the finance matters in profitable manner in the critical challenging
 P a g e | 31

atmosphere, the recommendation is made which would suggest the organization in formulation of
a healthy and strong position financially with proper management system.

4.4 Modes of Data Collection

The study is based on primary and secondary data which includes

Primary Data – Primary data is collected from the employees of the ThinkNEXT Technologies
PVT.LTD. Mohali

Secondary Data – Secondary data was gathered from books and journals and Financial Statements
of the ThinkNEXT Technologies PVT.LTD. Mohali
 P a g e | 32

CHAPTER-5

ANALYSIS AND INTERPRETATION

Classification of Ratios
5.1 Liquidity Ratio:

i. Current Ratio
ii. Quick or Acid test or Liquid ratio

1. Current Ratio: = Current Assets

Current Liabilities

Year Current Assets Current Liabilities Current Ratio

2020-2021 168848.05 207498 0.81
2021-2022 368460.29 774899 0.47

Current Ratio
1

0.8

0.6

0.4

0.2

0
2015-2016 2016-2017

Series 1

Interpretation: A ratio equal to the rule of thumb of 2:1 i.e current asset double the current
liabilities is satisfactory. As per the above table current ratio of ThinkNEXT is not satisfactory as
it is less than 2:1 for the year 2015-2016 and 2016-2017.
 P a g e | 33

2. Quick / Liquid / Acid test ratio: = Quick or liquid assets

Current liabilities

Year Quick Assets Current Liabilities Quick Ratio

2020-2021 83848.05 207489 0.40
2021-2022 356120.292 774899 0.47

Quick / liquid Ratio

0.48

0.46

0.44

0.42

0.4

0.38

0.36
2015-2016 2016-2017

Series 1

Interpretation: As a rule of thumb or as a convention quick ratio 1:1 considered satisfactory.

Above table shows that quick ratio of ThinkNEXT for the year 2015-2016is 0.40 and 2016-2017
0.47.

5.2 Activity Ratios

i. Inventory / stock turnover Ratio
ii. Working capital turnover Ratio
 P a g e | 34

1. Inventory Turnover Ratio: = Cost of Goods Sold

Closing stock

Year COGS Closing Stock ITR (in times)

2020-2021 2510101 0 0
2021-2022 395979 12340 32.08

Inventory Turnover Ratio

35

30

25

20

15

10

0
2015-2016 2016-2017

Series 1

Interpretation: According to the table for the last two years inventory turnover ratio of
ThinkNEXTwas highest in the year 2016-2017.

1. Proprietary or Equity Ratio= Shareholder’s Fund

Total Assets
Proprietary Ratio = Equity + Preference + Reserve & Surplus

Total Assets = Fixed Assets + Current Assets

 P a g e | 35

Year Shareholder’s Fund Total Assets Proprietary ratio

2020-2021 144391.00 372622.05 0.38
2021-2022 323085.74 1150986.74 0.28

Proprietary Ratio
0.4

0.35

0.3

0.25

0.2

0.15

0.1

0.05

0
2015-2016 2016-2017

Series 1

Interpretation: This ratio indicates that in year 2015-2016proprietary Ratio is 0.38 and sin 2016-
2017. It decreased to 0.28.

1. Fixed Asset to Total Long-term Funds

Fixed Assets Ratio = Fixed Assets

Total long-term funds

Long term funds = Shareholder’s + long term borrowings
 P a g e | 36

Year Fixed Assets Total long-term Ratio

Funds
2020-2021 164376.00 372622.05 0.44
2021-2022 678219.45 1134219.74 0.59

Fixed Asset Ratio

0.7

0.6

0.5

0.4

0.3

0.2

0.1

0
2015-2016 2016-2017

Series 1

Interpretation: The Ratio indicates the extent to which the totals of fixed assets are
financed by long – term funds of the firm. Generally, the total of fixed assets should be
equal to the total of long-term funds

A. Profitability Ratios:
(A) General Profitability Ratios
i. Gross profit Ratio
ii. Operating profit Ratio
 P a g e | 37

iii. Net profit Ratio

1. Gross Profit Ratio= Gross Profit * 100

Net Sales

Year Gross Profit Net Sales Gross Profit Ratio

2020-2021 1103249 1353350 81.5
2021-2022 2187445 2583425 84.6

Gross Profit Ratio

85
84.5
84
83.5
83
82.5
82
81.5
81
80.5
80
79.5
2015-2016 2016-2017

Series 1

Interpretation: There is no standard norm for gross profit ratio but it should be adequate to provide
for fixed charges, dividends, and accumulation of reserves. Higher the gross profit ratio better the
results.

3. Net Profit Ratio: = Net profit after tax * 100 /Net Sales

Or

Net Profit Ratio = Net operating profit * 100

Net Sales
 P a g e | 38

Year Net Profit Net Sales Net Profit ratio

2020-2021 39829.35 1353350 2.94
2021-2022 190280.69 2583425 7.36

Net Profit Ratio

8

0
2015-2016 2016-2017

Series 1

Interpretation: Generally higher the ratio better it is.

B. Overall Profitability Ratio

1. Return on Shareholder’s Investment Ratio= Net Profit (Before Interest & Tax)
Capital Employed

Capital Employed = Fixed Assets + Current assets – Current Liabilities

 P a g e | 39

Year Net Profit Interest & Capital Employed Ratio

Tax
2020-2021 57641.35 121726.05 0.47
2021-2022 275363.69 271780.74 1

Return on Shareholder's Investmennt Ratio

1.2

0.8

0.6

0.4

0.2

0
2015-2016 2016-2017

Series 1

Interpretation: This Ratio reveals how well the resources of a firm are being used. Higher
the Ratio better are the results.

5.3 FINDINGS

1. ThinkNEXT Technologies PVT.LTD. Mohali has a current ratio in the year 2015-2016
was recorded 0.81 and in and in the year 2016-2017 it was 0.47.

2. The quick ratio of ThinkNEXT in the years 2015-16 and 2016-17 was 0.40 and 0.47.
3. The inventory turnover ratio of ThinkNEXT in 2015-16 is 0.00 and in 2016sss-17 is
32.08.

4. The equity ratio of ThinkNEXT in the years 2015-16ss and 2016-17 was 0.38 and 0.28.

5. The fixed asset to total long term assets ratio of ThinkNEXT in the years 2015-16 and
2016-17s was 0.44 and 0.59.
 P a g e | 40

6. The gross profit ratio of ThinkNEXT in 2015-16 is 81.5 and in 2016-17s is 84.6.

7. The net profit ratio of ThinkNEXT in 2015-16 is 2.94 and in 2016-17 is 7.36.

8. Return on Shareholder’s Investment of the ThinkNEXT in 2015-16 is 0.45 and in 2016-17

is 1.0.

5.4 CONCLUSION
1. After analyzing the trading a/c we came to know the company had efficient
performance.
2. After analyze the profit and loss statement we realized the profits were good as per
companies past performance.
3. In the end when we analyze the balance sheet the company has increase his
performance as per past.
4. As far as ratios are concerned the company’s short term financial positions is
satisfactory.
5. Up to the mark performance.
6. From the point of view of long-term financial positions the company’s debt equity
ratio is zero which means company is less dependent on outsides loans.
7. Cash profit ratio, return on shareholders fund ratio earning are increasing every
year.

At the end we can say that the financial position of THINK NEXT TECHNOLOGY
PVT. LTD.MOHALI is sound good.
 P a g e | 41

BIBLIOGRAPHY
Books:
 Gupta, Shashi K, Management Accounting; Kalyani Publishers, Ed. 2003

 Kothari, C.R., Research Methodology; WishwaParkashan, Ed. 2004

 Annual General Report of the company

 Documents & files of ThinkNEXT Technologies PVT.LTD. Mohali

 The source of data regarding ThinkNEXT Technologies PVT.LTD. Mohali Profile

Details is collected from the annual reports of ThinkNEXT and some part of the profile

is also taken from the following websites

Websites:
 WWW.Managementparadise.Com

 WWW.Scribed.Com

 WWW.Wikipedia.Com

 WWW.Wisegeek.Com

 www.thinknet.co.in

 WWW.thinknexttraining.com
 P a g e | 42

Annexures
THINKNEXT TECHNOLOGIES PRIVATE LIMITED
SCF 112, SECOND FLOOR, PHASE 11, MOHALI

PROFIT AND LOSS STETEMENT

FOR THE YEAR ENDED 31ST MARCH 2020

P a r t i c u l a r s Note No
Figures for the Previous year 31.03.2015

I . Revenue from operations 1 0 11,900,000.00

I I . O t h e r I n c o m e 64,685.97
III. T o t a l R e v e n u e ( I + I I ) 11,964,685.97
I V . E x p e n s e s :
Cost of material s consume d 1 1 5,750,000.00
Purchase of Stock-in-Trade

Changes in inventories of finished goods, work-in-progress, and Stock-in-Trade

Employee benefit expens e 1 2 1,262,000.00

F i n a n c i a l c o s t s 1 3 571,791.50
Depreciation and amortization expense 805,188.00
O t h e r e x p e n s e s 1 4 48,000.00
T o t a l E x p e n s e s 8,436,979.50

V .
Profit before exceptional and extraordinary items and tax (III - IV)
3,527,706.47

V I . E x c e p t i o n a l I t e m s

V I I . Profit before extraordinary items and tax (V - VI)

3,527,706.47

VI I I . E x t r a o r d i n a r y I t e m s -

I X . Profit before tax (VII - VIII) 3,527,706.47

 P a g e | 43

X . T a x ex p e n s e :
( 1 ) C u r r e n t t a x
( 2 ) D e f e r r e d t a x

X I .
Profit/(Loss) from the period from continuing operations (VII - VIII)
3,527,706.47

X I I . Profit/(Loss) from discontinuing operations -

XI I I . Tax expense of discounting operations -

XI V.
Profit/(Loss) from Discontinuing operations (XII - XIII)
-

X V . Profit/(Loss) for the period (XI + XIV) 3,527,706.47

 P a g e | 44

THINKNEXT TECHNOLOGIES PRIVATE Limited

SCF 112, SECOND FLOOR, PHASE 11, MOHALI

BALANCE SHEET
FOR THE YEAR ENDED 31ST MARCH 2020

P a r t i c u l a r s Note No
Figures for the current year 31.03.2015

I. EQUITY AND LIABILITIES

( 1 ) S h a r e h o l d e r s ' F u n d s
( a ) S h a r e C a p i t a l 1 13,297,794.79
( b ) R e s e r v e s a n d S u r p l u s 2 3,074,007.95
(c) Money received against share warrant s
(2) Share application money pending allotment -

(3) Non-Current Liabilities

( a ) L o n g - t e r m b o r r o w i n g s 3 3,194,007.9
(b) Deferred tax liabilities (Net)
(c) Other Long-term liabilities
( d ) L o n g - t e r m p r o v i s i o n s

( 4 ) C u r r e n t L i a b i l i t i e s
( a ) S h o r t - t e r m b o r r o w i n g s
( b ) T r a d e p a y a b l e s 4 3,170,087.95
(c) Other current liabilities 5 55,000.00
( d ) S h o r t - t e r m p r o v i s i o n s
T o t a l 22,790,898.55
I I . A s s e t s
( 1 ) N o n - c u r r e n t a s s e t s
( a ) F i x e d a s s e t s
( i ) T a n g i b l e a s s e t s 6 11,177,144.87
( i i ) I n t a n g i b l e a s s e t s
(iii) Capital work-in-progress
(iv) Intangible assets under development
 P a g e | 45

(b) Non-current investments

(c) Deferred tax assets (net)
(d) Long term loans and advance s
(e) Other non-cu rrent assets -

( 2 ) C u r r e n t a s s e t s
( a ) C u r r e n t i n v e s t m e n t s -
(b) Inventori es (as certifi ed by di rectors) 6,693,555.00
( c ) T r a d e r e c e i v a b l e s 7 3,842,000.00
(d) Cash and cash equivalents 8 445,000.00
(e) Short-term loans and advance s 9 633,198.68
( f ) O t h e r c u r r e n t a s s e t s
T o t a l 22,790,898.55
 P a g e | 46

THINKNEXT TECHNOLOGIES PRIVATE Limited

SCF 112, SECOND FLOOR, PHASE 11, MOHALI

PROFIT & LOSS STATEMENT

FOR THE YEAR ENDED 31ST MARCH 2021

P a r t i c u l a r s Note No Fi gu res for t h e Previ ou s year 31. 03. 2016

I .

Revenue from operations 1 0 1 1 , 7 0 0 , 0 0 0 . 0 0

I I . O t h e r I n c o m e 8 4 , 6 8 5 . 9 7
I I I . Total Revenue (I +II) 1 1 , 7 8 4 , 6 8 5 . 9 7
IV. E x p e n s e s :

Cost of materials consumed 1 1 5 , 7 0 0 , 0 0 0 . 0 0

Purchase of Stock-in-Trade

Changes in inventories of finished goods, work-in-progress, and Stock-in-Trade

Employee benefit expense 1 2 1 , 2 5 1 , 0 0 0 . 0 0

Financial costs 1 3 6 1 1 , 5 8 9 . 7 4
8 6 3 , 1 5 0 . 0 0

Depreciation and amortization expense

Other expenses 1 4 5 0 , 0 0 0 . 0 0

Total Expenses 8 , 4 7 5 , 7 3 9 . 7 4
 P a g e | 47

V .

Profit before exceptional and extraordinary items and tax (II - IV) 3 , 3 0 8 , 9 4 6 . 2 3
V I . Exce ptional Ite ms
VI I . Profit before extraordinary items and tax (V - VI)

3 , 3 0 8 , 9 4 6 . 2 3

VIII.
E xt r a o r d i n a r y I t e ms -

IX.
Profit before tax (VII - VIII) 3 , 3 0 8 , 9 4 6 . 2 3

X . T a x e xp e n se :
(1) Current tax
(2) Deferred tax

XI.

Profit/(Loss) from the perid from continuing operations (VII - VIII) 3 , 3 0 8 , 9 4 6 . 2 3

XI I .

Profit/(Loss) from discontinuing operations -

XIII.
Tax expense of discounting operations -

XIV.
Profit/(Loss) from Discontinuing operations (XII - XIII) -

XV. Profit/(Loss) for the period (XI + XIV) 3 , 3 0 8 , 9 4 6 . 2 3

 P a g e | 48

THINKNEXT TECHNOLOGIES PRIVATE LIMITED

SCF 112, SECOND FLOOR, PHASE 11, MOHALI

BALANCE SHEET
FOR THE YEAR ENDED 31ST MARCH 2021

P a r t i c u l a r s Note No
Figures for the current year 31.03.2016

I. EQUI TY AN D LI ABIL ITIE S

( 1 ) S h a r e h o l d e r s ' F u n d s
( a ) S h a r e C a p i t a l 1 13,329,903.08
( b ) R e s e r v e s a n d S u r p l u s 2 6,216,570.94
(c) Money recei ved agai nst share warrant s
(2) Share application money pending allotment -

(3) Non-Current Liabilitie s

( a ) L o n g - t e r m b o r r o w i n g s 3 3,201,716.77
(b) Deferred tax liabilities (Net)
(c) Other Long-term liabilities
( d ) L o n g - t e r m p r o v i s i o n s

( 4 ) C u r r e n t L i a b i l i t i e s
( a ) S h o r t - t e r m b o r r o w i n g s
( b ) T r a d e p a y a b l e s 4 2,400,000.00
(c) Ot her c ur re nt l i abili ti e s 5 95,000.00
( d ) S h o r t - t e r m p r o v i s i o n s
T o t a l 25,243,191.49
I I . A s s e t s
( 1 ) N o n - c u r r e n t a s s e t s
( a ) F i x e d a s s e t s
( i ) T a n g i b l e a s s e t s 6 10,446,135.87
( i i ) I n t a n g i b l e a s s e t s
(iii) Capital work-in-progress
(iv) Intangible assets under development
(b) Non-current i nvestment s
(c) Deferred tax assets (net)
(d) Long term loans and advances
 P a g e | 49

(e) Other non-current assets -

( 2 ) C u r r e n t a s s e t s
( a ) C u r r e n t i n v e s t m e n t s -
( b ) I nv e nt o r i e s ( a s c e r t i f i e d b y d i re c t o r s ) 7,757,530.72
( c ) T r a d e r e c e i v a b l e s 7 5,005,399.82
(d) Cash and cash equivalents 8 972,314.40
(e) Short-term loans and advances 9 1,061,810.68
( f ) O t h e r c u r r e n t a s s e t s
T o t a l 25,243,191.49
 P a g e | 50

THINKNEXT TECHNOLOGIES PRIVATE Limited

SCF 112, SECOND FLOOR, PHASE 11, MOHALI

PROFIT & LOSS STATEMENT

FOR THE YEAR ENDED 31ST MARCH 2022

P a r t i c u l a r s Note No
Figures for the current year 31.03.2016

I. EQUI TY AN D LI ABIL ITIE S

( 1 ) S h a r e h o l d e r s ' F u n d s
( a ) S h a r e C a p i t a l 1 13,329,903.08
( b ) R e s e r v e s a n d S u r p l u s 2 6,216,570.94
(c) Money recei ved agai nst share warrant s
(2) Share application money pending allotment -

(3) Non-Current Liabilitie s

( a ) L o n g - t e r m b o r r o w i n g s 3 3,201,716.77
(b) Deferred tax liabilities (Net)
(c) Other Long-term liabilities
( d ) L o n g - t e r m p r o v i s i o n s

( 4 ) C u r r e n t L i a b i l i t i e s
( a ) S h o r t - t e r m b o r r o w i n g s
( b ) T r a d e p a y a b l e s 4 2,400,000.00
(c) Ot her c ur re nt l i abili ti e s 5 95,000.00
( d ) S h o r t - t e r m p r o v i s i o n s
T o t a l 25,243,191.49
I I . A s s e t s
( 1 ) N o n - c u r r e n t a s s e t s
( a ) F i x e d a s s e t s
( i ) T a n g i b l e a s s e t s 6 10,446,135.87
( i i ) I n t a n g i b l e a s s e t s
(iii) Capital work-in-progress
(iv) Intangible assets under development
(b) Non-current i nvestment s
(c) Deferred tax assets (net)
 P a g e | 51

(d) Long term loans and advances

(e) Other non-current assets -

( 2 ) C u r r e n t a s s e t s
( a ) C u r r e n t i n v e s t m e n t s -
( b ) I nv e nt o r i e s ( a s c e r t i f i e d b y d i re c t o r s ) 7,757,530.72
( c ) T r a d e r e c e i v a b l e s 7 5,005,399.82
(d) Cash and cash equivalents 8 972,314.40
(e) Short-term loans and advances 9 1,061,810.68
( f ) O t h e r c u r r e n t a s s e t s
T o t a l 25,243,191.49
 P a g e | 52

THINKNEXT TECHNOLOGIES PRIVATE LIMITED

SCF 112, SECOND FLOOR, PHASE 11, MOHALI

BALANCE SHEET
FOR THE YEAR ENDED 31ST MARCH 2022

P a r t i c u l a r s Note No
Figures for the previous year 31.03.201 7

I. EQUITY AND LIABILITIES

( 1 ) S h a r e h o l d e r s ' F u n d s
( a ) S h a r e C a p i t a l 1 11,435,668.23
( b ) R e s e r v e s a n d S u r p l u s 2 4,544,401.81
(c) Money received against share warrant s
(2) Share application money pending allotment -

(3) Non-Current Liabilities

( a ) L o n g - t e r m b o r r o w i n g s 3 2,312,481.2
(b) Deferred tax liabilities (Net)
(c) Other Long-term liabilities
( d ) L o n g - t e r m p r o v i s i o n s

( 4 ) C u r r e n t L i a b i l i t i e s
( a ) S h o r t - t e r m b o r r o w i n g s
( b ) T r a d e p a y a b l e s 4 4,506,981.23
(c) Other current liabilitie s 5 65,100.00
( d ) S h o r t - t e r m p r o v i s i o n s
T o t a l 22,864,632.50
A s s e t s
( 1 ) N o n - c u r r e n t a s s e t s
( a ) F i x e d a s s e t s
( i ) T a n g i b l e a s s e t s 6 11,177,144.87
( i i ) I n t a n g i b l e a s s e t s
(iii) Capital work-in-progress
(iv) Intangible assets under development
(b) Non-current investments
(c) Deferred tax assets (net)
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(d) Long term loans and advances

(e) Other non-current assets -

( 2 ) C u r r e n t a s s e t s
( a ) C u r r e n t i n v e s t m e n t s -
(b) I nve ntori es (as cer ti fi ed by di rectors ) 6,693,555.00
( c ) T r a d e r e c e i v a b l e s 7 4,142,695.42
(d) Cash and cash equivalents 8 218,038.53
(e) Short-term loans and advances 9 633,198.68
( f ) O t h e r c u r r e n t a s s e t s
T o t a l 22,864,632.50