CHAPTER I

INTRODUCTION

1.1 BROAD AREA OF STUDY

In the Financial Management, understanding an organization's financial position is paramount
for strategic decision-making and long-term sustainability. This encompasses the efficient
allocation of resources, risk management, and maximizing shareholder value. Within the
domain of Financial Analysis, techniques such as ratio analysis, trend analysis, and cash flow
analysis provide insights into the liquidity, solvency, and profitability of the company. By
delving into these areas. I aim to provide a holistic view of TOP A INDIA CONTRACTORS
Private Ltd. Corporation's financial health, identifying strengths, weaknesses, and potential
areas for improvement. Through rigorous examination and interpretation of financial
statements, we seek to uncover underlying trends, assess the effectiveness of financial
strategies, and offer recommendations for enhancing the company's overall financial position.
This study will contribute valuable insights to stakeholders, enabling informed decision-
making and fostering sustainable growth in an ever-evolving financial landscape.

1.2 DOMAIN OF THE STUDY

Financial analysis is a specialized field within finance that focuses on evaluating the financial
health and performance of organizations. It involves the systematic examination of financial
statements, including balance sheets, income statements, and cash flow statements, to assess
various aspects of a company's operations. Techniques such as ratio analysis, trend analysis,
and comparative analysis are commonly employed to derive meaningful insights into
liquidity, profitability, solvency, and operational efficiency. Financial analysts use these tools
to identify trends, strengths, weaknesses, and potential risks inherent in an organization's
financial position. By interpreting financial data, analysts provide valuable information to
investors, creditors, and management, aiding in decision-making processes related to
investment, lending, and strategic planning. Financial analysis plays a crucial role in helping
stakeholders understand the current state of an organization's finances and anticipate future
performance, thereby guiding effective resource allocation and risk management strategies
1.3 NEEDS FOR THE STUDY

 Provides sights into the financial health and stability of a company

 Aids in making informed decisions regarding investments, expansions, and financial
 Helpe identify and mitigate potential risks faced by the company
 Assists in evaluating the company's performance over time and setting realistic goals
 Attracts investors and creditors by demonstrating transparency and reliability in
financial reporting

1.4 SCOPE OF THE STUDY

 Examination of financial statements to assess liquidity solvency, profitability, and

efficiency,
 Comparison of financial performance with industry benchmarks and competitor
metrics
 Analysis of trends and patterns in financial data to identify areas of strength and
weakness
 Evaluation of the impact of financial decisions and strategies on the company's
overall financial position.
 Consideration of external factors such as economic conditions, industry trends, and
regulatory changes that may influence the financial position of the company
1.5 STATEMENT OF THE PROBLEM

In today's dynamic business landscape, accurately assessing the financial position of

companies presents a complicated challenge. Existing methodologies often lack
comprehensiveness, leading to incomplete evaluations of liquidity, solvency, and profitability.
Moreover, the intricate interplay of various factors influencing financial position complicates
analysis efforts. This complexity, coupled with the failure to derive actionable insights.
hampers strategic decision-making and effective risk management. Addressing these
challenges is paramount to ensure transparent, reliable financial reporting and to facilitate
informed decision-making processes.

1.6 OBJECTIVES OF THE STUDY

 To find the profitability of the TOP A INDIA CONTRACTORS Private Ltd.

 To find the operational efficiency of the company
 To examine the changes in the liquidity position of the company
 To identify the fluctuations in the cost of goods sold over the years

1.7 LIMITATIONS OF THE STUDY

 Financial statement analysis heavily relies on the data provided by the company in its
financial statements.
 Extrapolating future performance based solely on historical data can be risky.
 Analysing standalone financial statements may not capture the full context.
1.8 THEORETICAL FRAMEWORK

FINANCIAL PERFORMANCE

Financial performance refers to the evaluation of how well a company is managing its
finances and generating returns for its investors and stakeholders. It involves analysing
various financial metries, ratios, and indicators to assess the profitability, efficiency, liquidity,
solvency. and overall health of a business. Key components of financial performance analysis
include assessing revenue growth, profitability margins, return on investment, asset
utilization, cash flow generation, debt management, and shareholder value creation. By
evaluating financial performance, investors, creditors, and management can gain insights into
a company's financial strength, stability, and ability to achieve its strategic objectives.

FACTORS DETERMINING FINANCIAL PERFORMANCE

Revenue Growth: Revenue growth is a fundamental driver of financial performance.

Increasing sales and revenue streams indicate market demand for a company's products or
services, contributing to higher profitability and shareholder value.

Profitability Margins: Profitability ratios such as gross profit margin, operating profit
margin, and net profit margin measure the efficiency of a company's operations in generating
profits relative to its revenue. Higher profitability margins indicate better financial
performance and operational efficiency.

Cost Management: Effective cost management is crucial for improving financial

performance, controlling expenses, optimizing production costs, and managing overheads can
enhance profitability and operational efficiency, leading to improved financial results.

Asset Utilization: Asset turnover ratios assess how efficiently a company utilizes its assets to
generate revenue. Higher asset turnover ratios indicate better utilization of resources and
improved financial performance.

Liquidity: Liquidity ratios such as the current ratio and quick ratio measure a company's
ability to meet short-term financial obligations with its current assets. Adequate liquidity
ensures financial stability and flexibility, contributing to improved financial performance.

Solvency: Solvency ratios assess a company's ability to meet long-term financial obligations
and debt obligations. Maintaining a healthy solvency position enhances investor confidence
and contributes to sustained financial performance.
Return on Investment (BOT): ROI measures the return generated on investments relative to
the cost of investment. Positive ROI indicates value creation for shareholders and effective
capital allocation, contributing to improved financial performance.

Financial Leverage: Financial leverage ratios assess the extent to which a company uses
debt to finance its operations and investments. While leverage can amplify returns, excessive
debt levels can increase financial risk and impact financial performance negatively.

Market Share: Market share reflects a company's competitive position within its industry.
Increasing market share can lead to economies of scale, higher revenue, and improved
financial performance

Economic Environment: Macroeconomic factors such as GDP growth, interest rates,

inflation, and consumer confidence influence overall economic conditions, impacting
consumer spending, demand for products/services, and business profitability

Industry Trends: Industry-specific factors such as technological advancements, regulatory

changes, competitive landscape, and market dynamics influence financial performance and
business strategies.
 CHAPTER II

REVIEW OF LITERATURE

Sharma Nishi (2011) Studied the financial position of passenger and commercial vehicle
segment of the automobile industry in the terms of four financial parameters namely liquidity,
profitability, leverage and managerial efficiency analysis for the period of decade from 2001-
02 to 2010-11. The study concludes that profitability and managerial efficiency of Tata
motors as well as Mahindra & Mahindra Itd are satisfactory but their liquidity position is not
satisfactory. The liquidity position of commercial vehicle is much better than passenger
vehicle segment.

Singh Amarjit & Gupta Vinod (2012) Explored an overview of automobile industry. Indian
automobile industry itself as a manufacturing hub and many joint ventures have been setup in
India with foreign collaboration. SWOT analysis done there are some challenges by the virtue
of which automobile industry faces lot of problems and some innovative key features are
keyless entry, electrically controlled mechanisms enhanced driving control, soft feel interiors
and also need % focus in future on like fuel efficiency, emission reduction safety and
durability.

Zafar S.M.Tariq & Khalid S.M (2012) The study explored that ratios are calculated from
financial statements which are prepared as desired policies adopted on depreciation and stock
valuation by the management. Ratio is simple comparison of numerator and a denominator
that cannot produce complete and authentic picture of business. Results are manipulated and
also may not highlight other factors which affect position of firm by promoters.

Ray Sabapriya (2012) Studied the sample of automobile companies to evaluate the position
of industry through indicators namely sales, production and export trend etc. for period of
2003-04 to 2009-10. The study finds that automobile industry has been passing through
disruptive phases by over debt burden, underutilization of assets and liquidity instability. The
researcher suggested to improving the labour productivity, labour flexibility and capital
efficiency for success of industry in future.

Dawar Varun (2012) Study to analyse the effect of various fundamental corporate policy
variables like dividend, debit, capital expenditure on stock prices of automobile companies of
India. The study tends that dividend & investment policy are relevant and capital structure
irrelevant to stock prices
Mistry Dharmendra S. (2012) Understood a study to analyse the effect of various
determinants on the profitability of the selected companies. It concluded that debt equity
ratio. inventory ratio, total assets were important determinants which effect positive or
negative effect on the profitability. It suggested to improve solvency as to reduce fixed
financial burden on the company profit & give the benefit of trading on equity to the
shareholders.

Rapheal Nisha (2013) The author tries to evaluate the financial position of Indian tire
industry. The study was conducted for period 2003-04 to 2011-12 to analyse the position with
financial indicators, sales trend, export trend, production trend etc. The result suggests the
key t to success in industry is to improve labour productivity and flexibility and capital
efficiency.

Motwani Rakhi (2013) The author examines the profitability position and growth of
company in light of sales and profitability of Tata Motors for past ten years. Data is analysed
through rations, standard deviations and coefficient of variance. The study reveals that there
not exists a strong relationship between sales & profitability of company

Sharma Rashmi, Pande Neeraj & Singh Avinash (2013) For understanding how social
media monitoring can help diving the consumer decision & also study. The functions of
social media i.e. monitor, responses amplify and lead at Maruti Suzuki India It. The
researcher had discussion with social media team median managers for collecting data & also
visited the official social media sites of MSIL...

Bhuvaneswari. R & Kanimozhi (2014) To study the credit worthiness of selected firms in
Indian car industry, tiruchy. Professor Edward Altman of New York University developed
method Z score analysis to predict the company failure or bankruptcy measure the fiscal
fitness of a company combined a set of five financial ratios.
 CHAPTER III

RESEARCH METHODOLOGY

3.1 RESEARCH

Research is defined as the development of new knowledge and or the creative use of existing
knowledge in order to generate new concepts, approaches, and understandings. This could
require synthesizing and interpreting previous studies to develop new and innovative
outcomes. Research is also defined as a way of thoroughly considering research on a certain
subject or problem using scientific methodologies. Research is a systematic investigation into
describing, explaining, predicting, and regulating an observable event.

3.2 RESEARCH METHODOLOGY

Research Methodology refers to the systematic approach and techniques used to conduct
research and gather relevant data to address research questions or objectives. It encompasses
the overall design, procedures, tools and analytical methods employed in a research study.

3.3 RESEARCH DESIGN

Research design is the specification of the method and procedure for acquiring the
information needed to solve the problem. The research design followed for this research
study is analytical research design.

3.3.1 ANALYTICAL RESEARCH DESIGN

Analytical research is the process of gathering, analysing, and interpreting information to

make inferences and reach conclusions. Depending on the purpose of the research and the
data you have access to, you can conduct analytical research using a variety of methods.

Examining secondary information is time and money-efficient, enabling researchers to

explore new research issues or confirm prior findings. With this approach, researchers
examine previously gathered information for a different reason. Information from earlier
cohort studies, accessible databases, or corporate documents may be included in this.
Profitability ratio

 Return on asset ratio

 Operating profit margin

Financial ratio

 Current ratio
 Quick ratio

Income statement analysis

 Cost of goods sold (COGS)

NET PROFIT MARGIN

Net profit margin is a profitability ratio that measures how much profit a company makes
from its total revenue. The formula to calculate net profit margin is:

Net Profit Margin (Net Profit/Total Revenue) 100%

Where:

Net Profit is the total revenue minus all expenses, including taxes and interest.

Total Revenue is the total income generated from sales or services.

This ratio indicates the percentage of revenue that remains as profit after all expenses have
been deducted.

OPERATIONAL EFFICIENCY RATIO

Operational efficiency refers to how well a company utilizes its resources to produce goods
or services. It measures the effectiveness of the company's operations in generating output
relative to input.

Asset turnover ratio

Inventory turnover ratio

Account payable turnover ratio

ASSET TURNOVER RATIO

Asset turnover ratio assesses how efficiently a company utilizes its assets to generate
revenue.

Asset Turnover Ratio = Total Revenue/Average Total Assets.

A higher ratio indicates that the company is generating more revenue per unit of assets
employed.

GROSS PROFIT MARGIN

Gross profit margin is a profitability ratio that measures the proportion of revenue left over
after deducting the cost of goods sold (COGS). The formula to calculate gross profit margin
is

Gross Profit Margin (Gross Profit/Total Revenue) 100%

This ratio indicates the percentage of revenue that exceeds the cost of producing goods or
services, before considering other expenses such as operating costs, taxes, and interest.

INVENTORY TURNOVER RATIO

Inventory turnover ratio measures how quickly a company sells its inventory within a specific
period.

Inventory Turnover Ratio = Cost of Goods Sold/Average Inventory

A higher ratio suggests that the company efficiently manages its inventory levels and
turnover.

ACCOUNT PAYABLE TURNOVER RATIO

Accounts payable turnover ratio evaluates how effectively a company manages its payments
to suppliers.

Accounts Payable Turnover Ratio = Total Purchases/Average Accounts Payable

A higher ratio signifies that the company pays its suppliers more promptly, which can
indicate strong financial health and good relationships with supplier
PROFITABILITY RATIO

Profitability ratios assess a company's ability to generate profits relative to its revenue. assets,
or equity. These ratios provide insights into the company's overall financial health and
efficiency in generating returns for its stakeholders. Common profitability ratios include net
profit margin, return on assets (ROA), return on equity (ROE), and gross profit margin.
Analysing profitability ratios helps investors, creditors, and management evaluate the
company's performance, profitability, and potential for growth.

 Return on asset ratio

 Operating profit margin

RETURN ON ASSET RATIO

Return on Assets (ROA) is a financial ratio that measures a company's profitability by

evaluating its ability to generate earnings from its assets. The formula to calculate ROA is:

ROA Net Income / Average Total Assets

 Net Income is the company's profit after deducting all expenses, including taxes and
interest.
 Average Total Assets is the average value of the company's assets over a specific
period.

ROA indicates how efficiently a company utilizes its assets to generate profit. A higher ROA
suggests that the company is more effective at generating earnings from its assets, while a
lower ROA may indicate inefficiency in asset utilization.

OPERATING PROFIT MARGIN

Operating profit margin is a profitability ratio that measures the proportion of revenue that
translates into operating profit after deducting operating expenses. The formula to calculate
operating profit margin is:
 Operating Profit Margin (Operating Profit/Total Revenue) * 100%

Operating Profit is the profit generated from the core business operations, calculated by
subtracting operating expenses (such as cost of goods sold, operating expenses, and
depreciation) from total revenue.

 Total Revenue is the total income generated from sales or services.

 Operating profit margin indicates the percentage of revenue that remains as profit
after covering operating expenses. It reflects the efficiency of a company's core
operations in generating profit.

FINANCIAL RATIO

Financial ratios are quantitative indicators used to analyse a company's financial performance
and position. They provide insights into various aspects such as profitability, liquidity,
solvency, and efficiency.

 Quick ratio
 Current ratio

QUICK RATIO

Quick Ratio (also known as Acid-Test Ratio) measures a company's ability to meet its short-
term obligations with its most liquid assets.

Quick Ratio (Current Assets - Inventory)/Current Liabilities

A higher quick ratio indicates a better ability to cover short-term liabilities without relying on
the sale of inventory.

CURRENT RATIO

Current Ratio assesses a company's short-term liquidity by comparing its current assets to its
current liabilities.

Current Ratio = Current Assets/Current Liabilities

A current ratio above I indicates that a company has more current assets than current
liabilities, suggesting it can cover its short-term obligations. However, a very high current
ratio may indicate inefficient use of assets.
INCOME STATEMENT ANALYSIS

Income statement analysis involves examining a company's income statement to evaluate its
financial performance over a specific period. This analysis focuses on understanding the
company's revenue, expenses, and profitability. Key aspects of income statement analysis
include assessing revenue trends, analyzing the composition of expenses, calculating
profitability ratios, such as gross profit margin and net profit margin, and comparing the
company's performance to industry peers or benchmarks. Income statement analysis provides
valuable insights into a company's operational efficiency, profitability, and overall financial
health, aiding investors, creditors, and management in decision-making processes.

COST OF GOODS SOLD

Cost of Goods Sold (COGS) refers to the direct costs incurred in producing or purchasing the
goods that a company sells during a specific period. COGS includes the cost of materials,
labor, and overhead directly associated with the production of goods. It does not include
indirect costs such as marketing expenses or administrative costs.

COGS Beginning Inventory + Purchases During the Period - Ending Inventory

This formula calculates the total cost of inventory that was sold during the period, allowing
companies to determine the direct cost of producing the goods sold.
 CHAPTER- IV

COMPANY PROFILE

Top A India Contractors Company is doing a special type of waterproofing works for 12
years in India and overseas. He was worked in Senior Technical Leader in BCS Proken,
Singapore. Our Major Waterproofing work in Metro Stations and Tunnels, Nuclear &
Thermal Power plant, Commercial and Residential Buildings, Dam Repair & Rehabilitation
work and Shipyard. We have the expertise and resources to manage and create quality
solutions for challenging infrastructure projects. We coupled with the training of a permanent
workforce of over 250 peoples.

At TOP A INDIA CONTRACTORS Waterproofing we pride ourselves on being a

multifaceted contractor, providing innovative & turnkey waterproofing painting and roong
solutions to any domestic, industrial or commercial building.

We have a team of diverse professionals, able to provide the correct advice and solutions for
any need.

The company has been in the business for over five (5) years and their success rate in this
industry, residential and commercial industry speaks for itself. With its management’s in-
depth knowledge of this business, the company is in a good position to grow and expand its
business and increase its turn-over and profit.
COMPANY Mission

To provide quality and innovative solutions in waterproofing, fireproofing, flooring and

repairs that will enable the construction and maintenance of better engineering structures and
buildings

COMPANY Vision

To provide quality with cost efficient, covering global standards in all factors that will enable
the world class maintenance and construction of better engineering structures and buildings.

COMPANY SERVIES

 Water proofing
 Injection System
 CONCERTE REPAIR & REHABILITATION SYSTEM
 PROTECTIVE COATING
 INDUSTRIAL FLOORING
 DAM REPAIR REHABILITATION SYSTEM
 HIGH PRESSURE WATER JET SYSTEM

MAJOR CUSTOMER

 LARSEN & TOUBRO

 PSK GROUP
 PRINCE
 Infosys
 Reliance
 CHAPTER V

DATA ANALYSIS ANA INTERPRETION

5.1 NET PROFIT MARGIN

Net Profit Margin (Net Profit/Total Revenue) 100%

TABLE 5.1

NET PROFIT
YEAR NET PROFIT TOTAL REVENUE MARGIN
2020-2021 7,51,947.52 2,60,45,277.43 2.37
2021-2022 12,30,456.45 3,41,96,200.24 2.89
2022-2023 18,46,972.59 4,46,59,782.35 3.56

CHART 5.1

NET PROFIT MARGIN

4
3.56
3.5
3 2.89

2.5 2.37

2
1.5
1
0.5
0
2020-2021 2021-2022 2022-2023

NET PROFIT MARGIN

INTERPRETION

From the table 5.1. the net profit margin showed an increasing rate which is a positive sign.
The ratio for the current year is 3.56, which is the highest among the three years. So the
company is good in net profit margin,

5.2 OPERATIONAL EFFICIENCY RATIO

5.2.1 GROSS PROFIT MARGIN

Gross Profit Margin (Gross Profit/Total Revenue) 100%

TABLE 5.2.1

GROSS NET PROFIT

YEAR PROFIT TOTAL REVENUE MARGIN
2020-2021 38,78,515.53 2,60,45,277.43 14.89
2021-2022 52,51,273.95 3,41,96,200.24 15.35
2022-2023 69,00,803.11 4,46,59,782.35 15.45

CHART 5.2.1

GROSS PROFIT MARGIN

15.5 15.45
15.4 15.35
15.3
15.2
15.1
15
14.89
14.9
14.8
14.7
14.6
2020-2021 2021-2022 2022-2023

GROSS PROFIT MARGIN

INTERPRETION

From the table 5.2.1, the highest gross profit margin ratio of 15.45 is found for the year 2022-
2023 and lowest gross profit margin of 14.89 is found for the year 2020-2021.

5.2.2 ASSET TURNOVER RATIO

Asset Turnover Ratio = Total Revenue/Average Total Assets.

TABLE 5.2.2

YEAR TOTAL AVERAGE TOTAL ASSET ASSET TURNOVER

REVENUE RATIO
2020-2021 2,60,45,277.43 79,01,205.55 3.2
2021-2022 3,41,96,200.24 86,70,082.33 3.9
2022-2023 4,46,59,782.35 88,63,027.77 5.03

CHART 5.2.2

ASSET TURNOVER RATIO

6
5.03
5
3.9
4
3.2
3

0
2020-2021 2021-2022 2022-2023

ASSET TURNOVER RATIO

INTERPRETION

From the table 5.2.2, the highest asset turnover ratio of 5. 03is found for the year 2022-2023
and asset turnover ratio of 3.2 is found for the year 2020-2021.

5.2.3 INVENTORY TURNOVER RATIO

Inventory Turnover Ratio = Cost of Goods Sold/Average Inventory

TABLE 5.2.3

Cost OF INVENTORY
YEAR GOODS SOLD AVERAGE INVENTORY TURNOVER RATIO
2020-2021 2,69,65,282.67 50,37,966.71 5.3
2021-2022 2,06,51,908.9 69,39,608.8 3.1
2022-2023 3,48,52,972.74 77,18,633,97 4.5

CHART 5.2.3

INVENTORY TURNOVER RATIO

6
5.3
5 4.5

4
3.1
3

0
2020-2021 2021-2022 2022-2023

INVENTORY TURNOVER RATIO

INTERPRETATION
From the table 5.2.3 the highest inventory turnover ratio of 5.3 is found for the year 2020-
2021 and lowest inventory turnover ratio of 3.1 is found for the year 2021-2022. The
inventory turnover ratio indicating that the company must concentrate on maintaining the
inventory turnover ratio.

5.2.4 ACCOUNT PAYABLE TURNOVER RATIO

Accounts Payable Turnover Ratio = Total Purchases/Average Accounts Payable

TABLE 5.2.4

TOTAL AVERAGE ACCOUNT ACCOUNTS

YEAR PURCHASE PAYABLE PAYABLE RATIO
2020-2021 2,17,52,059.15 21,79,729.55 9,97
2021-2022 2,96,68,416.59 28,22,056.02 10.51
2022-2023 3,37,07,893.17 25,69,086.82 13.12

CHART 5.2.4

ACCOUNTS PAYABLE RATIO

14 13.12

12
10.51
9.97
10

0
2020-2021 2021-2022 2022-2023

ACCOUNTS PAYABLE RATIO

INTERPRETATION
From the table 5.2.4 the highest accounts payable turnover ratio of 13.12 is found for the year 2022-
2023 and lowest accounts payable turnover ratio of 9.97 is found for the year 2020-2021.

5.2 PROFITABILITY RATIO

5.3.1 RETURN ON ASSET RATIO

ROA Net Income / Average Total Assets

TABLE 5.3.1

YEAR NET INCOME AVG.TOTAL. ASSET RETURN ON RATIO

2020-2021 7,51,947.52 79,01,205.05 9.5
2021-2022 12,30,456.45 86,70,082.33 14.19
2022-2023 18,46,972.59 88,63,027.7 20.8

CHART 5.3.1

RETURN ON ASSET RATIO

25
20.8
20

15 14.19

9.5
10

0
2020-2021 2021-2022 2022-2023

RETURN ON ASSET RATIO

INTERPRETATION
From the table 5.3.1 the return on asset ratio showed an increasing rate which is
a positive sign. The ratio for the 2022-2023 is 20.8, which is the highest among
the three years so the company good in return on asset ratio.

5.3.2 OPERATING PROFIT MARGIN

Operating Profit Margin (Operating Profit/Total Revenue) * 100%

TABLE 5.3.2

OPERATING OPERATING
YEAR PROFIT REVENUE PROFIT MARGIN
2020-2021 7,48,285.53 2,60,45,277.43 2.87
2021-2022 12,30,456.45 3,41,96,200.24 3.59
2022-2023 18,32,222.59 4,46,59,782.35 4.1

CHART 5.3.2

OPERATING PROFIT MARGIN

4.5 4.1
4 3.59
3.5
3 2.87

2.5
2
1.5
1
0.5
0
2020-2021 2021-2022 2022-2023

OPERATING PROFIT MARGIN

INTERPRETATION

From the table 5.3.2 the operating profit margin showed an increasing rate which is a positive
sign. The ratio for the 2022-2023 year is 4.1, which is the highest among the three years so
the company good in operating profit margin.

5.4 FINANCIAL RATIO

5.4.1 CURRENT RATIO

Current Ratio = Current Assets/Current Liabilities

TABLE 5.4.1

YEAR CURRENTLIABILITIES CURRENT ASSET CURRENT RATIO

2020-2021 43,59,458.11 1,23,13,730.75 2.82
2021-2022 56,44,112.05 1,42,06,031.39 2.51
2022-2023 51,38,173.64 1,48,32,420.31 2.88

CHART 5.4.1

CURRENT RATIO
3

2.9 2.88
2.82
2.8

2.7

2.6
2.51
2.5

2.4

2.3
2020-2021 2021-2022 2022-2023

CURRENT RATIO
 INTERPRETATION

From the table 5.4.1 the current ratio showed a slightly increasing rate which is a neutral sign.
The ratio for the 2022-2023 year is 2.88, Which is the higher among the three years.so the
company sustain in normal current ratio.

5.4.2 QUICK RATIO

Quick Ratio (Current Assets - Inventory)/Current Liabilities

TABLE 5.4.2

CURRENT
YEAR CURRENT ASSET INVENTORY LIABILITIES QUICK RATIO

2020-2021 1,23,13,730.75 55,88,041.37 43,59,458.11 1.54

2021-2022 1,42,06,031.39 82,91,175.76 56,44,112.05 1.04
2022-2023 1,48,32,420.31 71,46,096.19 51,38,173.64 1.49

CHART 5.4.2
 INTERPRETATION

From the table 5.4.2 the quick ratio showed a slightly decrease rate which is a neutral sign.
The ratio for the 2020-2021 year is 1.58, Which is the higher among the three years. So, the
company sustain in normal quick ratio.

5.5 INCOME STATEMENT ANALYSIS

5.5.1 COST OF GOODS SOLD (COGS)

COGS Beginning Inventory + Purchases During the Period - Ending Inventory

TABLE 5.5.1

OPENING ADDTIONAL CLOSING COST OF GOODS

YEAR INVENTORY INVENTORY INVENTORY SOLD (COGS)

2020-2021 55,88,041.84 2,96,68,416.5 82,91,175.76 2,06,51,908.9

9
2021-2022 44,87,891.59 2,17,52,059.15 55,88,041.84 2,69,65,282.67
2022-2023 82,91,175.76 3,37,07,893 71,46,096.19 3,48,52,972.74

CHART 5.5.1
INTERPRETATION

From the table 5.5.1 the highest cost of goods sold of 3,48.52,972.74 is found for the year
2022-2023 and lowest cost of goods sold of 2,06,51,908.9 is found for the year2020-2021.
The cost of goods sold indicating that the company have good numbers of (COGS)
comparing three years.