Kohinoor Textile Mills_3
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Transcript of Kohinoor Textile Mills_3
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Kohinoor Textile Mills.Kohinoor Textile Mills.Group Members
Fasih Ud-Din AfridiSami ullahImran Khan
Raza KhanMajid Khan
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F inancialF inancial statement analysis:statement analysis:
1. Current ratio:One of the most general and frequently used liquidity ratio. It shows a firms ability tocover its current liabilities with its current assets.
0
0.2
0.4
0.6
0.8
1
1.2
1.4
2005 2006 2007 2008 2009
koehenor
industery average
Years Kohinoor IndustrialAverage
2005 1 .02 1 .10
2006 1 .07 1 .15
2007 1 .05 1 .25
2008 0 .75 0 .9 5
200 9 0 .80 0 .87
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Trend Analysis of Trend Analysis of C Current Ratiourrent Ratio
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2 . Acid test ratio:A more conservative measure of activity is the liquid test. It shows a firms ability to meetits current liabilities with its most liquid (quick) assets.
Year Kohinoor IndustrialAverage
2005 0 .4 7 1 .3 8
2006 0 .5 9 1 .55
2007 0 .6 9 1 .8 4
2008 0 .4 5 1 .4 5
200 9 0 .4 7 0 .93
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Trend Analysis of Acid test RatioTrend Analysis of Acid test Ratio
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3 . inventory turn over ratio:to determine how effectively the firm is managing inventory ( and also to gain anindication of the liquidity of the inventory). We compute the inventory turnover raio.
Year Kohinoor IndustrialAverage
2005 4.3 2 2 .9 2
2006 3. 62 3.3 0
2007 3. 7 3 3.34
2008 4. 17 3.33
200 9 4. 17 3. 67
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Trend Analysis of inventory turnover RatioTrend Analysis of inventory turnover Ratio
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4 . Inventory turnover in days:to know how many days, on average, before inventory is turned in to accountreceivable through sales.
Year Kohinoor IndustrialAverage
2005 8 4.4 1 125
2006 100 .7 110 .6
2007 98 .0 9 10 9. 28
2008 87 .5 3 10 9.9
200 9 87 .5 3 99.4 5
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Trend Analysis of Inventory Turnover in daysTrend Analysis of Inventory Turnover in days
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5 . Total asset turnover:
The relationship of net sales to total assets is known as total asset turnover.
Year Kohinoor IndustrialAverage
2005 0 .608 0 .57
2006 0 .49 2 0 .61
2007 0 .55 0 .65
2008 0 .6 37 0 .6 9
200 9 0 .626 0 .80
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Trend Analysis of Total Asset Turnover Trend Analysis of Total Asset Turnover
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6 . Debt to equity ratio:To asses the extent to which the firm is using borrowed money.
Year Kohinoor IndustrialAverage
2005 1 .0 4 1 .61
2006 0 .785 1 .60
2007 0 .785 1 .27
2008 0 .72 4 1 .5 4
200 9 0 .551 1 .51
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Trend Analysis of Debt to Equity ratioTrend Analysis of Debt to Equity ratio
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7 . Debt to asset ratio:It highlights the relative importance of debt financing to the firm by showingpercentage of firm·s assets that is supported by debt financing.
Year Kohinoor IndustrialAverage
2005 58 .70% 0 .60
2006 36 .9 0% 0 .4 7
2007 62 .10% 0 .5 3
2008 67 .4 0% 0 .5 9
200 9 58 .70% 0 .58
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Trend Analysis of Debt to Asset ratioTrend Analysis of Debt to Asset ratio
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8 . Total capitalization ratio:It tells us the relative importance of long term debt to the capital structure of the firm.
Year Kohinoor IndustrialAverage
2005 37 .10% 0 .33
2006 27 .10% 0 .3 1
2007 43. 20% 0 .3 0
2008 50 .66% 0 .34
200 9 20 .80% 0 .26
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Trend Analysis of Total Capitalization RatioTrend Analysis of Total Capitalization Ratio
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9 . Interest coverage ratio:It indicates a firm·s ability to cove interest charges. It is also called times interestearned.
Year Kohinoor IndustrialAverage
2005 1 .7 9 2 .72
2006 0 .08 9 1 .25
2007 0 .44 6 1 .50
2008 0 .57 3.3 0
200 9 1 .3 5 1 .5 3
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Trend Analysis of Interest Coverage RatioTrend Analysis of Interest Coverage Ratio
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10. Gross profit ratio:This ratio tells us the profit of the firm relative to sales after we deduct the cost ofproducing the goods.
Year Kohinoor IndustrialAverage
2005 14.
80 10.4
6
2006 1 4. 6 4 10 .15
2007 15 .3 8 10 .18
2008 1 4. 8 9 10 .06
200 9 18 .71 11 .9 0
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Trend Analysis of Gross Profit ratioTrend Analysis of Gross Profit ratio
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11. Net profit margin:It is the measure of firm profitability of the sales after taking account of all expensesand income taxes.
Year Kohinoor IndustrialAverage
2005 4.3 2 1 .9 2
2006 -0 .56 -0 .2 9
2007 -0 .05 0 .57
2008 -5 .2 -1 .33
200 9 2 .6 1 .08
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Trend Analysis of Net Profit MarginTrend Analysis of Net Profit Margin
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12 . Return on assets:Indicates the profitability on the assets of the firm.
Year Kohinoor IndustrialAverage
2006 -0 .0027 -0 .10
2007 -0 .0002 0 .55
2008 -0 .0 33 0 .3 2
2009
0.016 0
.22
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Trend Analysis of Return on InvestmentTrend Analysis of Return on Investment
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12 . Return on equity:Indicates the profitability to shareholders of the firm.
Year Kohinoor IndustrialAverage
2005 0 .111 1 .17
2006 -0 .01 -0 .61
2007 -0 .0008 2 .05
2008 -0 .1 43 1 .27
200 9 0 .082 0 .88
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Trend Analysis of return on EquityTrend Analysis of return on Equity
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F indingsF indings
Liquidity:Current ratio of the company is decreasing.Acid test ratio shows company maintaining high level of inventory.
Asset Utilization:The inventory turnover ratio is increasing which means that sales are increasing.hence the inventory turnover in days is decreased.
Debt And Profitability:Debt to equity ratio is decreasing which means that company is using less portion ofdebt financing.However in total assets the company is using more portion of debt financing.Till2 00 8 the capitalization ratio was increasing, however in 2 00 9 it has decreasedfrom the industrial average as well. This means that in 2 00 9 the company is
maintaining low percentage of long term debts in total capitalization.Profitability:
The gross profit ratio of the company is increasing and over the industrial avg.The net ratio has decreased and observed negative however in 2 00 9 it hasbecome positive.ROA and ROE has increased till 2 00 9 , but less than industrial average.