For example we have taken listed company "Shree Cements"

1. SHREE CEMENTS LTD

2. Introduction:
Shree cements is rapidly growing and one of the most efficient and environment friendly
company in India.
Currently, Its manufacturing operations are spread over north and east India across six states
(Rajasthan, uttarkhand,Bihar,Harayana,UP and Chhattisgarh)
Its total production capacity is 29.3 MT/annum
It portfolio consist of banguar cements,Shree cements and rock strong cements
Among top 100 listed companies in India in terms of market capitalization

3. Financial Strength
Revenue from Operation INR 9496.25 Cr
Operating profit INR 2874.94 Cr
Net profit INR 1339.11 Cr
Net worth (As at 31 March,2017) INR 7698.14 Cr
BSE- Rs.17183.35 NSE- Rs.17166.20
Competitor : Ambuja Cemets, ACC Ltd, Jk Cements, ultra-tech cements,

4. Management Discussion & Analysis
The Index of industrial production has continue to show a dismal picture which is estimated to
grow at around 0.4% during April 2016-17 on the back of 2.6% recorded in FY2015-16
WPI 3.7% & CPI is 5%
Gross tax collection increased by 18%, which will enhance Gov. ability to spent on
infrastructure and other development project
All India cement production during FY 2016-17 is around 280 Millan ton which indicates the
DE-growth of 1% around previous year
The company Reach 20million ton mark in CFY which showed a growth f 7.9%
Sale volume of company showed a growth of 8.4% mainly because of significant strides made
by the company in eastern India cement market.
The Revenue of the company grew 19.4%.

5. Power Sector continues to witness over capacity condition but There is however hope that the
government’s initiatives of UDAY (Ujwal DISCOM Assurance Yojana) and inclination shown by new
Government in the State of Uttar Pradesh to supply 24 hours supply may help liſt demand to
some extent. Overall, outlook for power sector remains grim for 2017-18.
During the year, the expansion project of grinding unit at Aurangabad in Bihar was completed
which increased its capacity to 3.6 Million Tons Per Annum (MTPA) from 2.0 MTPA & setup new
manufacturing facility belgaum, Karnataka
Environment Excellence Award 2016 instituted by "Mission Energy foundation” under the
category" Excellence in Implementation of New Environmental Norms-Existing TPPs Category

6. Short Term Solvency Ratio :
CURRENT RATIO
It is a ratio that indicate companies ability to pay its
obligation in the short term and show the amount of
current assets a company has per rupee of current
liability
Interpretation : The increase in the current ratio,
the FY 2016-17 means that company has more
current assets to meets its current liabilities.
QUICK RATIO
It is a ratio that measure, relatively more liquid
current assets to pay its current liabilities
Interpretation : The ideal quick ratio should be 1:1,
in this case it is not so but it is very close to the
ideal ratio and comparatively better than last year
which means companies has more liquid assets to
pay its current obligations
2015-16 1.56
2016-17 1.65
2015-16 0.86
2016-17 0.99

7. Efficiency Ratio:
DEBTORS TURNOVER RATIO
This ratio measures the efficacy of a firm
credit policy and collection mechanism and
shows the no.of time the receivable are
converted into cash in a year
Interpretation : As the receivable turnover has
been increase, it means companies receivables
are being converted rapidly into cash
AVERAGE COLLECTION PERIOD (ACP)
It measure a period, debtors on an average
require to pay their liabilities to the company
Interpretation: As in FY 2016-17 the collection period
has been decreased by around 7 days so it a positive
sign for the company as liquidity of the company is
increased
2015-16 16.77
2016-17 25.15
2015-16 21.76
2016-17 14.51

8. Inventory Turnover ratio
• It measure number of time, the companies inventory
are turned into sales
• Interpretation : In FY 2016-17 ,The ITR is less
compared to FY 2015-16 it implies that there is some
lagging in the efficient inventory management
Average Sales Period
• It measure number of days, that companies require to sell
its inventory
• Interpretation : In FY 2016-17 as average sales period is
increased by around 3 days it implies companies require
more days to clear their inventory as compare to last year.
2015-16 4.16
2016-17 3.81
2015-16 87.74
2016-17 90.75

9. • Creditors Turn over ratio = It is a
efficiency ratio that measures the
rate at which company pays of its
suppliers
Interpretation : As the creditors
turnover ratio is increased, from this
it can be inferred that company pays
its creditors at faster rate.
• Average payment period= It is the ratio
that shows the time required by the
company to pay off its accounts payable
Interpretation : As the average payment
period is decreased. Hence it is a positive
sign for a company
• Total Assets turn over ratio = It
measure the efficiency of the
company total assets
Interpretation : In FY 2016-17 total
asset turnover that means efficiency
of a company in using its assets has
increased
2015-16 11.21
2016-17 14.25
2015-16 32.56
2016-17 25.61
2015-16 0.5826
2016-17 0.7548

10. Profitability Ratio :
• Gross Profit (GP) Ratio = It shows
the relationship between gross
profit and net sales revenue.
Interpretation : In FY 2016-17 The
gross profit of shree cements is
increased by 2.2% which means there
is a increase in efficiency in using its
raw material and labour during
production process
• Operating Profitability Ratio = It
measurement of what proportion of
companies revenue is left over after
paying its operating expenses.
Interpretation : In FY 2016-17 The
operating profit of shree cements is
increased by 2.06% . That indicates the
increase in the efficiency of company in
controlling the cost and expenses
associated with business operations
• Net Profit Ratio = It is actual profit
of the company after deducting all
it expenses. It is profit that is left
for share holders.
Interpretation : In FY 2016-17 The Net
profit of shree cements is decreased
by 2.3%. That shows,
2015-16 50.71
2016-17 53.19
2015-16 25.52
2016-17 28.08
2015-16 18.47
2016-17 14.1

11. • Earning per share (EPS) = The portion of a company's
profit allocated to each outstanding share of
common stock
• Interpretation : In the FY 2016-17 the EPS is
increased by 56.26 rupees as compare to last year so
it is positive sign for the share holder.
• Return on Assets (ROA) = It illustrates how well
management in employing the companies total assets to
make a profit .
• Interpretation : In the FY 2016-17 , Value of ROA is
marginally decreased by 0.08% it implies there is marginally
decrease in utilising the assets of the company.
2015-16 328.13
2016-17 384.39
2015-16 12.07%
2016-17 11.99%

12. • Return on Equity (ROE) = It is ratio that measure
the ability of firm to generate profits from its
share holder investment in the company.
Interpretation: As ROE has slightly increased in the
FY 2016-17, we can interpret that company is more
efficient in using the shareholders fund
• Return on capital employed = It is a ratio that measure the
company profitability and efficiency with which its capital is
employed
Interpretation : In FY 2016-17, the return on capital employed
is decreased. It implies that the efficiency with which the
company is using its capital employed has been decreased.
2015-16 16.69%
2016-17 17.39%
2015-16 18.033%
2016-17 14.97%

13. Market Standing Ratio :
• Dividend pay-out ratio : It measures
the amount of dividend paid to share
holders relative to the amount of
total net income of the company
• Interpretation-AS there is a drastic
increase in dividend pay-out ratio.
Hence it is a positive sign for a
company
2015-16 7.31%
2016-17 36.42%

14. Long term Solvency :
• Interest Coverage Ratio : This Ratio
Shows whether the company has
sufficient income to cover its interest
requirement by wide margin.
• Interpretation: As company's debt
level has increased and also due to
other expenses its EBIT has decreased
so the interest coverage ratio has
came down marginally. It is a negative
sign for the company
• Debt to Equity Ratio : It measure the
relationship of the capital provided by
the creditors to the amount provided
by share holders.
• Propriety Ratio : It is a proportion
of share holder equity to total
assets of the company
2015-16 10.85%
2016-17 10.30%
2015-16 18.39
2016-17 18.09
2015-16 0.72
2016-17 0.69
Interpretation: The total debt
of a company has not
increased as much the share
capital of accompany has
increased so i.e. the reason
behind debt equity ratio being
less this year.
Interpretation : As propriety
ratio, IN FY 2016-17 is less than
FY2015-16 it means company
owns comparatively less total
assets from the shareholders
funds.

15. Recommendation:
 Company should try to increase its inventory turn over ratio by reducing the stock holding period.
 Company's net profit has come down so in order to improve its net profit it should try to control on other expenses &
also try to reduce its other financial liabilities on which interest cost is high.
 It should rather increase its share capital by issuing shares.
 Return on capital employed has come down. Hence the company should control on its other expenses & should try to
efficiently use its capital employed.

16. THANK YOU…!!!