project group no.7

A

PROJECT REPORT

ON

PREPARED BY : ROLL NO :

Paneliya Ketan 22

M.B.A SEM-II

ACADEMIC YEAR: - 2014-2015

GUIDANCE BY :

Mr. Nilesh Movalia

SUBMITTED TO :

K.K.PAREKH INSTITUTE OF MANAGEMENT STUDY OF AMRELI

1

Preface

M.B.A. is course in which practical aspect in an important as theoretical aspect. M.B.A is to develop effective managers and that require training as practical aspect. The growth of economy is depends upon skilled managers and M.B.A. course fulfils this need. The practical studies give an idea to the student about problem they have to face in the future of their managerial life

2

Acknowledgement

To complete this report many persons have helped us. At the time of presenting this report we thank to all who have helped Us to complete this report.

First off all we thank to Dr. Vishal Patidar the Director of K.K.PAREKH INSTITUTE OF MANAGEMENT STUDIS OF AMRELI. And I also thank to Mr. Nilesh Movaliya project guides for providing opportunity to prepare the report

Date: 22/4/2014 Signature

Place: Amreli

3

Content

Sr.no Particular

1. Introduction

2. Overview about company and its products and services3. Financial analysis and it’s important for company

4. Financial statement analysis5. Ratio analysis6. Findings and suggestions7. Conclusion8. References9. Annexure

4

Introduction

We are prepared financial report on asian paint this company is Indian large company this company establish in Mumbai and founded 1942 this company find out product and service,important,financial statement analysis as under capital structure ,dividend policy,working capital management,ratio analysis,per share ratios,profitability ratio,leverage ratio,combine leverage and payout ratio this company is all ratio find.

5

Company profile

Product and service

Asian Paints manufactures and markets industrial and decorative coatings. Along with that

the company also provides home painting services and solutions. The company's key

products and brands include the following:

6

Asian Paints Limited

Type Public

Traded as BSE 50082

NSE: ASIANPAINT

Industry Chemicals

Founded 1942

Headquarters Mumbai, India

Area served Global

Key people K.B.S. Anand (MD& CEO)

Products Paints and speciality products

http://en.wikipedia.org/wiki/File:Asian_Paints_Logo.svg

Decorative paints: Interior wall paints, Exterior wall paints, Wood surface paints, Metals

surface paints.

Industrial coatings: Protective coatings, Floor coatings, Road markings.

Ancillaries: Wall primer, Acrylic Wall Putty, Exterior Wall Putty, Wood Primer.

Asian paints made a foray in automotive paints in the year 1997 with a joint venture

with PPG Industries. The joint venture is called PPG Asian paints. The company

manufactures body coatings and plastic coatings.

Paint brands owned by the company are: Ace & Apex, Apcolite, Apex, Apex Ultima, Asian

Paints, Colour Next, Premium Gloss Enamel, Royale, Royale Play, Touchwood, Tractor

Emulsion, Utsav.

Importance of asian paint company

Asian Paints believes that internships are important, not just for you but, the

organization as well.

We want young minds who can work on live business challenges and we trust our

interns to excel against all odds even if it may be the first time that they are taking

up such a high-impact challenge.

7

http://en.wikipedia.org/wiki/PPG_Industries

This is again a program which has a long standing history and has been an

important revenue for us to identify and select our people.

With our internship program, you will find yourself enriched by your seniors,

many of whom are alumni of your B-schools.

Frequent reviews will help you to track your progress. Excel and you may find

that you have been rewarded with a PPO/PPI.

You won't lack friends or mentors here, or opportunities for that matter.

1 .Capital structure

Year 2009 2010 2011 2012 2013Equity Capital 10094.47 1557.22 1975.32 2487.78 3022.26Debt Capital 65.29 66.29 64.13 168.22 46.76Total Capital 10159.76 1623.51 2039.45 2656 3069.02

8

2009 2010 2011 2012 20130

2000

4000

6000

8000

10000

12000

Equity CapitalDebt Capital

Interpretation:

Asian paint Company in capital structure was 2009 increase 10159.76 so, well for the company. 2010 1623.51 in ratio is decrease is of company.

2..Dividend Policy

Year 2013 2012 2011 2010 2009

Equity dividend 167.86 258.98 306.94 383.69 441.23

9

2013 2012 2011 2010 20090

50100150200250300350400450500

Equity dividend

Equity dividend

Interpretation:

Asian paint company in Equity Dividend 2009 year in highest ratio 441.23 for the last 5 year. After the 2009 continues 4 yetheDividend tax was definitely decrease of company.

3.Working capital management

Year 2013 2012 2011 2010 2009

Current assets:loans,advances

3644.14 2626.85 1,729.79 1364.85 1172.36

10

Less:Current liabilities Provision

2579.26 2349.41 1849.61 1533.21 1034.92

Total net current assets

464.88 277.44 -119.82 168.36 137.44

2013 2012 2011 2010 2009-500

0

500

1000

1500

2000

2500

3000

3500

4000

Current assets:loans,advancesLess:Current liabilities ProvisionTotal net current assets

Interpretation:

Asian paint Company in current Assets will be increase continuously after 2010. In 2009 compare the ratio then decrease the ratio in 2010 but 2010 after total net current ratio is increase.

A.Per share Ratio

1. Earning per share

Year Mar ' 13 Mar ' 12 Mar ' 11 Mar ' 10 Mar ' 09

Adjusted EPS (Rs) 0.21 0.23 0.21 0.25 0.13

11

Mar ' 13

Mar ' 12

Mar ' 11

Mar ' 10

Mar ' 09

0

0.05

0.1

0.15

0.2

0.25

0.3

Adjusted EPS (Rs)

Adjusted EPS (Rs)

Interpretation:

Asian paint Company in earning per share is the ratio was continuously increase or decrease by the continuously year. In 2009 the ratio was 0.21 and 2010 in the ratio was 0.23the highest ratio for the last five year. 2010 in decrease the ratio was above 0.23 and 2012 in increase above 0.25 Last 2013 in again decrease the ratio was 0.13 and the ratio.

2.Dividend per share


Dividend per share 46.00 40.00 32.00 27.00 17.50

12

Mar ' 13 Mar ' 12 Mar ' 11 Mar ' 10 Mar ' 0905

101520253035404550

Dividend per share

Dividend per share

Interpretation:

Asian paint Company Dividend per share was a . In 2009 in the ratio was highest as compare to all five year in ratio. 2009 in 20 ratio and 2010 in 10 ratios so 2013 increase ratio 46.00 of company.

3.Price earning ratio


13

Book value (excl rev res) per share EPS (Rs) 2.88 2.59 2.54 2.01 3.02

Mar ' 13

Mar ' 12

Mar ' 11

Mar ' 10

Mar ' 09

0

0.5

1

1.5

2

2.5

3

3.5

Book value (excl rev res) per share EPS (Rs)

Book value (excl rev res) per share EPS (Rs)

Interpretation:

Asian paint Company Price earnings ratio was a changeable for the continuously five year. In 2009 was the ratio 3.02 and 2010 in increase the ratio was 2.01 but in the year 2011 the ratio was increase above the 50% at 2.54 2012 in the ratio was some point increase as compare the year was 2011 at 69.8 and also increases in the year 2013 at 2.88.

B.Profitability Ratio:

1: Operating Margin

14

Year 2013 2012 2011 2010 2009

Operating margin

0.17 0.17 1.76 0.19 0.13

2013 2012 2011 2010 20090

0.20.40.60.8

11.21.41.61.8

2

Operating margin

Operating margin

Interpretation:

Asian paint Company in Operating Margin ratio was at 2011year in 1.76 and increases the margin ratio as compare to 2009 and2013it is decrease.

2.Net profit Margin

15

Year Mar ' 13 Mar ' 12 Mar ' 11 Mar ' 10 Mar'09

Net profit margin (%) 11.54 11.38 11.61 14.29 7.97

Mar ' 13 Mar ' 12 Mar ' 11 Mar ' 10 Mar'090

2

4

6

8

10

12

14

16

Net profit margin (%)Series2

Interpretation:

Asian paint Company in net profit margin ratio was in2009 year is 7.97 lowest ratios for last five year. 2010 in increase ratios. In 2011 net profit ratio was increase 2011 the 11.61 as compare the 2011,2012 increase .

3. Return on investment ratio:

Year Mar ' 13 Mar ' Mar ' Mar ' Mar'09

16

12 11 10Adjusted return on net worth (%) 2.34 1.76 0.75 1.09 1.53

Mar ' 13 Mar ' 12 Mar ' 11 Mar ' 10 Mar'090

0.5

1

1.5

2

2.5

Adjusted return on net worth (%)

Adjusted return on net worth (%)

Interpretation:

Asian paint. Company in return on investment ratio was in2009 year at 1.53 lowest ratios for last five year. 2013 in increase 2.34 ratio. In 2011 return on investment ratio was decrease the 0.75 was comparing the 2010? 2012 increase the ratio at 1.76 and last 2013 in increase the ratio was 2.34.

C. Leverage Ratio:

1. Debt equity ratio:

17


Total debt/equity 0.02 0.07 0.03 0.04 0.06

Mar ' 13 Mar ' 12 Mar ' 11 Mar ' 10 Mar ' 090

0.01

0.02

0.03

0.04

0.05

0.06

0.07

0.08

Total debt/equity

Total debt/equity

Interpretation:

Asian paint Company in Debt - equity ratio was in 2013 year at 0.02 the lowest ratio for last five year in 2013year decrease 0.02 ratio. In 2012 debt - equity ratio was increasing the 0.07 was compare the 2009 2012 increase the ratio at 0.07 and last 2012in increase the ratio was 10.07.

2.Financial Leverage

FINANCIAL LEAVRAGE = EBIT /EBP

18

mar'13 mar'12 mar'11 mar'10 mar'091516.71 1371.99 1144.93 1013.86 578.02

mar'13

mar'12 mar'11 mar'10 mar'090

200400600800

1000120014001600

Series1

Interpretation:-

Asian paint Company in financial leverage was in 2009 year at 578.02 In 2013 year increase at 1371.99. In 2011 financial leverage was increase the 1144.93 2012 increase the ratio at 1371.99and last 2013 in increase the ratio was 1516.71.

3. Operating leverage

OPERETING LEAVREGE =CONTRIBUTION/EBIT

19

mar'13 mar'12 mar'11 mar'10 mar'09

0.88 0.89 0.86 0.87 0.99

mar'13 mar'12 mar'11 mar'10 mar'090.75

0.8

0.85

0.9

0.95

1

1.05

Chart Title

Series1

Interpretation:-

Asian paint Company in operating leverage was in 2009 year at 0.99 The lowest ratio for last five year in 2011 year decrease 0.86 ratio. In 2012 was increase the 0.89 highest rates for the year. 2009 increase the ratio at 0.99 and last 2009 in increase the ratio was 0.99.so, in this chart in continuously increase or decrease.

4.Combined Leverage:-

COMBINE LEAVREGE =OPERETING LEAVREGE*FINANCIAL LEAVREGE

20


1334.71 1221.07 984.64 882.05 572.24

Interpretation:-

Asian paint Company in combine leverage was in2009 year at 572.24 the lowest ratio for last five year. In 2010 year increase 882.05 ratios. 2011 year was increase the 984.64 2012 increase the ratio at 1221.07 and last 2013 in increase the ratio was1334.71 highest ratios.

D.Liquidity ratio:

1. Current Ratio:-

21


200

400

600

800

1000

1200

1400

1600

Chart Title

Series1

Year Mar'2013 Mar'2012 Mar'2011 Mar'2010 Mar'2009

Current ratio 1.18 1.07 0.93 0.89 1.13

Mar'2013 Mar'2012 Mar'2011 Mar'2010 Mar'20090

0.2

0.4

0.6

0.8

1

1.2

1.4

Current ratio

Current ratio

Interpretation:-

Asian paint Company in current ratio was in 2009 year at 1.13. The lowest ratio for last five year in 2010 year decreases 0.89 ratios. In 2013 current ratio was increase the 1.18 was comparing the 2010. 2012 decrease the ratio at 1.07and last 2013 in increase the ratio was 1.18.

2. Liquid ratio

Year mar'13 mar'12 mar'11 mar'10 mar'09liquidity ratio 0.61 0.57 0.34 0.38 0.59

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0.1

0.2

0.3

0.4

0.5

0.6

0.7

Year liquidity ratio

Year liquidity ratio

Interpretation:-

Asian paint Company in liquidity ratio was in 2009 year at 0.59. The lowest ratio for last five year in 2011 year decrease 0.34 ratio. In 2012 current ratio was increase the 0.57 as compare the 2009 2010 decrease the ratio at 0.38 and last 2013 in increase the ratio was 0.61.

3. Inventory Turnover Ratio:-


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Inventory turnover ratio 6.06 7.56 7.08 7.95 9.80


2

4

6

8

10

12

Inventory turnover ratio

Inventory turnover ratio

Interpretation:-

Asian paint Company in inventory turnover ratio was in 2009 year at 9.80 2010 year decrease 7.95 ratios. In 2011 current ratio was decrease the 7.08 as compare the 2013 and also highest ratio for the last five year 2009 year at 9.80.

E. Payout Ratio:-

1. Dividend Payout Ratio:-

24


Dividend payout ratio (net profit) 49.09 46.52 46.06 39.03 54.19


10

20

30

40

50

60

Dividend payout ratio (net profit)

Dividend payout ratio (net profit)

Interpretation:-

Asian paint Company in dividend payout ratio was in 2010 year at 39.03 and also highest ratio for the last five year. 2009 year increase 54.19 ratios.

2. Financial Charges Coverage Ratio:

25


Financial charges coverage ratio 54.76 53.34 75.34 56.68 39.57


10

20

30

40

50

60

70

80

Financial charges coverage ratio

Financial charges coverage ratio

Interpretation:-

Asian paint Company in financial charge coverage ratio was in 2011 year at 75.342010 year increase and 2009 lowest ratio at 54.76.

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finding and Suggestion:-

We are finding the all ratio for Asian Paint Company

All ratios in some ratio in good position for the company and some ratio in also bed position for the company but the company positivity is capital structure and current assets also increase by the every year. So, this is a very good sign for the company.

Suggestion:-

Asian paint Company in increase the follow ratio:-

Financial Charges Coverage Ratio, Price Earnings Ratio, Inventory turnover ratio, Return on inventory ratio, Dividend per share, Earning per share.

These are the ratio in needs for change in ratio so company going in growth and achieve more and more profit for company.

Conclusion:-

The Project report gives me a great experience in visiting. ASIAN PAINT

COMPANY The project report helps me to improve my knowledge. We have heartily

thankful to Nilesh Movalia co-operate with me and my partners and have give me all

the information about his organization.

Reference:-

We are completed this project with the help of www.rediff money.com, www.asian paint

Profit & Loss account of Asian Paints ------------------- in Rs. Cr. -------------------

Mar '13 Mar '12 Mar '11 Mar '10 Mar '09

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12 mths 12 mths 12 mths 12 mths 12 mths

Income

Sales Turnover 8,971.70 9,139.39 7,244.59 5,794.09 5,042.40

Excise Duty 0.00 812.31 638.57 426.37 532.28

Net Sales 8,971.70 8,327.08 6,606.02 5,367.72 4,510.12

Other Income 126.15 90.43 72.38 150.61 23.86

Stock Adjustments 175.91 143.78 157.54 130.83 0.61

Total Income 9,273.76 8,561.29 6,835.94 5,649.16 4,534.59

Expenditure

Raw Materials 5,361.00 4,866.63 3,812.47 2,966.23 2,641.09

Power & Fuel Cost 101.65 74.29 65.98 47.03 45.78

Employee Cost 404.59 343.51 302.34 262.73 239.77

Other Manufacturing Expenses 0.00 77.05 61.46 52.30 40.45

Selling and Admin Expenses 0.00 1,672.74 1,331.85 1,119.89 939.16

Miscellaneous Expenses 1,733.10 36.77 28.19 17.41 10.55

Preoperative Exp Capitalised 0.00 0.00 0.00 0.00 0.00

Total Expenses 7,600.34 7,070.99 5,602.29 4,465.59 3,916.80



Operating Profit 1,547.27 1,399.87 1,161.27 1,032.96 593.93

PBDIT 1,673.42 1,490.30 1,233.65 1,183.57 617.79

Interest 30.56 27.88 16.34 19.10 15.91

PBDT 1,642.86 1,462.42 1,217.31 1,164.47 601.88

Depreciation 126.98 99.49 94.48 60.74 57.15

Other Written Off 0.00 0.00 0.00 0.00 0.00

Profit Before Tax 1,515.88 1,362.93 1,122.83 1,103.73 544.73

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Extra-ordinary items 0.00 2.38 4.22 7.23 3.60

PBT (Post Extra-ord Items) 1,515.88 1,365.31 1,127.05 1,110.96 548.33

Tax 465.88 406.92 351.90 336.46 185.97

Reported Net Profit 1,050.00 958.39 775.15 774.50 362.36

Total Value Addition 2,239.34 2,204.36 1,789.82 1,499.36 1,275.71

Preference Dividend 0.00 0.00 0.00 0.00 0.00

Equity Dividend 441.23 383.69 306.94 258.98 167.86

Corporate Dividend Tax 74.29 62.24 50.11 43.33 28.53

Per share data (annualised)

Shares in issue (lakhs) 959.20 959.20 959.20 959.20 959.20

Earning Per Share (Rs) 109.47 99.92 80.81 80.74 37.78

Equity Dividend (%) 460.00 400.00 320.00 270.00 175.00

Book Value (Rs) 315.08 259.36 205.93 162.35 114.10

Balance Sheet of Asian Paints ------------------- in Rs. Cr. -------------------



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Sources Of Funds

Total Share Capital 95.92 95.92 95.92 95.92 95.92

Equity Share Capital 95.92 95.92 95.92 95.92 95.92

Share Application Money 0.00 0.00 0.00 0.00 0.00

Preference Share Capital 0.00 0.00 0.00 0.00 0.00

Reserves 2,926.34 2,391.86 1,879.40 1,461.30 998.55

Revaluation Reserves 0.00 0.00 0.00 0.00 0.00

Networth 3,022.26 2,487.78 1,975.32 1,557.22 1,094.47

Secured Loans 9.28 17.01 23.43 25.59 24.59

Unsecured Loans 37.48 151.21 40.70 40.70 40.70

Total Debt 46.76 168.22 64.13 66.29 65.29

Total Liabilities 3,069.02 2,656.00 2,039.45 1,623.51 1,159.76



Application Of Funds

Gross Block 2,803.73 1,659.51 1,611.22 1,194.39 1,116.93

Less: Accum. Depreciation 701.84 650.47 554.03 486.93 494.02

Net Block 2,101.89 1,009.04 1,057.19 707.46 622.91

Capital Work in Progress 52.55 827.30 67.32 380.72 164.64

Investments 449.70 542.22 1,034.76 703.69 234.77

Inventories 1,480.79 1,264.42 1,071.76 763.14 546.71

Sundry Debtors 633.88 500.24 366.68 331.43 311.02

Cash and Bank Balance 566.86 450.94 20.28 28.58 128.05

Total Current Assets 2,681.53 2,215.60 1,458.72 1,123.15 985.78

Loans and Advances 362.61 361.22 270.88 241.68 186.37

Fixed Deposits 0.00 50.03 0.19 0.02 0.21

Total CA, Loans & Advances 3,044.14 2,626.85 1,729.79 1,364.85 1,172.36

Deffered Credit 0.00 0.00 0.00 0.00 0.00

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Current Liabilities 2,078.94 1,929.18 1,511.37 1,229.04 849.08

Provisions 500.32 420.23 338.24 304.17 185.84

Total CL & Provisions 2,579.26 2,349.41 1,849.61 1,533.21 1,034.92

Net Current Assets 464.88 277.44 -119.82 -168.36 137.44

Miscellaneous Expenses 0.00 0.00 0.00 0.00 0.00

Total Assets 3,069.02 2,656.00 2,039.45 1,623.51 1,159.76

Contingent Liabilities 464.28 414.71 505.87 223.80 356.87

Book Value (Rs) 315.08 259.36 205.93 162.35 114.10

Key financial ratio:Mar '13

Mar '12 Mar '11 Mar '10 Mar '09

Investment Valuation RatiosFace Value 10.00 10.00 10.00 10.00 10.00Dividend Per Share 46.00 40.00 32.00 27.00 17.50Operating Profit Per Share (Rs) 161.31 145.94 121.07 107.69 61.92Net Operating Profit Per Share (Rs) 935.33 868.13 688.70 559.61 470.20Free Reserves Per Share (Rs) -- 249.31 195.88 152.29 104.05Bonus in Equity Capital 97.98 97.98 97.98 97.98 97.98Profitability RatiosOperating Profit Margin(%) 17.24 16.81 17.57 19.24 13.16Profit Before Interest And Tax Margin(%)

15.61 15.45 15.97 17.94 11.80

Gross Profit Margin(%) 15.83 15.61 16.14 18.11 11.90Cash Profit Margin(%) 12.93 12.50 12.92 13.42 9.40Adjusted Cash Margin(%) 12.93 12.50 12.92 13.42 9.40Net Profit Margin(%) 11.54 11.38 11.61 14.29 7.97Adjusted Net Profit Margin(%) 11.54 11.38 11.61 14.29 7.97Return On Capital Employed(%) 50.38 52.24 55.73 62.94 49.35Return On Net Worth(%) 34.74 38.52 39.24 49.73 33.10Adjusted Return on Net Worth(%) 34.74 38.30 38.90 42.79 33.85Return on Assets Excluding Revaluations

315.08 259.36 205.93 162.35 114.10

Return on Assets Including Revaluations

315.08 259.36 205.93 162.35 114.10

Return on Long Term Funds(%) 50.38 54.51 55.79 62.95 49.35Liquidity And Solvency RatiosCurrent Ratio 1.18 1.07 0.93 0.89 1.13

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Quick Ratio 0.61 0.57 0.34 0.38 0.59Debt Equity Ratio 0.02 0.07 0.03 0.04 0.06Long Term Debt Equity Ratio 0.02 0.02 0.03 0.04 0.06Debt Coverage RatiosInterest Cover 50.60 50.66 74.05 74.27 55.04Total Debt to Owners Fund 0.02 0.07 0.03 0.04 0.06Financial Charges Coverage Ratio 54.76 53.34 75.34 56.68 39.57Financial Charges Coverage Ratio Post Tax

39.51 38.94 54.22 44.73 27.37

Management Efficiency RatiosInventory Turnover Ratio 6.06 7.56 7.08 7.95 9.80Debtors Turnover Ratio 15.82 19.21 18.93 16.71 16.02Investments Turnover Ratio 6.06 7.56 7.08 7.95 9.80Fixed Assets Turnover Ratio 3.23 5.23 4.25 4.68 4.18Total Assets Turnover Ratio 2.95 3.22 3.33 3.40 4.02Asset Turnover Ratio 3.13 3.55 3.61 3.86 4.17Average Raw Material Holding -- 40.96 48.61 42.69 33.13Average Finished Goods Held -- 44.69 44.60 42.38 31.72Number of Days In Working Capital 18.65 11.99 -6.53 -11.29 10.97Profit & Loss Account RatiosMaterial Cost Composition 59.75 58.44 57.71 55.26 58.55Imported Composition of Raw Materials Consumed

44.05 25.57 23.86 20.74 19.49

Selling Distribution Cost Composition -- 17.11 17.08 17.51 17.27Expenses as Composition of Total Sales 0.61 0.50 0.66 0.64 0.64Cash Flow Indicator RatiosDividend Payout Ratio Net Profit 49.09 46.52 46.06 39.03 54.19Dividend Payout Ratio Cash Profit 43.80 42.15 41.05 36.19 46.81Earning Retention Ratio 50.91 53.21 53.54 54.64 47.00Cash Earning Retention Ratio 56.20 57.63 58.63 58.43 54.09AdjustedCash Flow Times 0.04 0.16 0.07 0.09 0.15

Mar '13

Mar '12 Mar '11 Mar '10 Mar '09

Earnings Per Share 109.47 99.92 80.81 80.74 37.78Book Value 315.08 259.36 205.93 162.35 114.10

Source : Dion Global Solutions Limited

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project group no.7

Business

service asian paints

ppg asian paints

ratio analysis

decorative paints

automotive paints

total capital

equity capital debt

exterior wall paints