1. Liquidity Ratios of Tata TeleservicesTable: 1 CURRENT ASSET At March31. 2011 Rs.

Inventory Sundry Debtors Loans and advances Cash in hand Cash at bank Total 353981303.44 85516779.40 1279541364.24 943530.07 1916215508.11 3636197482.26

Table: 2 CURRENT LIABILITIES At March31. 2011 Rs. Sundry Creditors Other Liabilities Provision for taxation Proposed dividend Dividend tax Total 138784778.42 108686563.39 1063000000.39 634300.00 107768.00 1311213409.81

Computation of Current and Quick Ratio is as follow:a.) Current Ratio. Current assets Current ratio= Current Liabilities

Table: 3 Particulars As on March31.2011 Current assets Current liabilities Current ratio 3636197482.26 1311213409.81 2.78

x 100000000

40 35 30 25 20 15 10 5 0 Current asset Current Liabilities

InterpretationStandard ratio is 2:1 and Tata Teleservices ltd.s ratio is 2.78:1. It is better than the standard ratio.

b.) Quick ratio/Acid test ratio Liquid asset Quick ratio/Acid test ratio = Current Liabilities Table: 4 Particulars At March31. 2011 Rs. Liquid assets Current liabilities Quick/Acid Test Ratio 3282216179 1311213410 2.50

x 100000000

35 30 25 20 15 10 5 0 Liquid assets Current liabilities

InterpretationTata Teleservices ltd.s Quick ratio/ acid test ratio at March 31.2011 is 2.50.

2. Solvency Ratios: a) Debt Equity Ratio Long term loans Debt equity ratio= Shareholders funds or Net worth Long term loans= Debentures, mortgage loan, bank loan, loans from financial institutions and public deposits etc. Shareholders Fund= Equity share capital, preference share capital, share premium, general reserves, capital reserves credit balance of profit & loss account fictitious assets. Table: 5 Particulars At March31. 2011 Rs. Long term loan Equity share capital Reserves & surplus Shareholders fund Debt equity ratio 426398140.72 634300 2284393451.33 2285027751.33 0.187

x 100000000

40 20 0 Long term fundsShareholder's fund

InterpretationThis ratio expresses the relationship between debt and equity and Tata Teleservices ltd.s Debt equity ratio is 0.187.

b) Debt ratioLong term loans Debt ratio = Capital Employed Table: 6 Particulars At March31. 2011 Rs. Long term debt Capital employed Debt ratio 426398140.72 2285027751.33 .187

x 100000000

25 20 15 10 5 0 Long term Debt. Capital employed

InterpretationThis ratio refers to Tata Teleservices ltd.s ratio of long term debt to total of external and internal funds, and Tata Teleservices ltd.s Debt. Ratio at March 31.2011 is 0.187.

c) Proprietary ratioShareholder Fund Proprietary = Capital Employed Table: 7 Particulars At March31. 2011 Rs. Shareholder fund Capital employed Proprietary ratio 2285027751.33 2285027751.33 1:1

x 100000000

25 20 15 10 5 0 Shareholders Fund Capital employed

InterpretationProprietary ratio refers the proportion proprietors funds to net, and after calculation of Tata Teleservices ltd.s Proprietary Ratio at March 31.2011 is 1:1.

d) Total assets to Debts ratioTotal assets Total asset to debts ratio= Long term Loans Table: 8 Particulars At March31. 2011 Rs. Total assets Long term loans Total asset to debt ratio 4027822953.23 426398140.72 9.45

x 100000000

45 40 35 30 25 20 15 10 5 0 Total asset Long term debts

InterpretationAccording to above statement we can say that Tata Teleservices ltd.s has total asset is greater than long term debts, and its total asset to debt ratio is 9.45.

e) Interest coverage ratio-

Net profit before interest and tax Interest coverage ratio = Fixed interest Charges Particulars At March31. 2011 Rs. Net profit before interest & tax Fixed interest charges Interest coverage ratio 730831826.17 0.00

x 100000000

8 7 6 5 4 3 2 1 0 Net profit before interest & tax Fixed interest charges

InterpretationThis ratio is also termed as Debt services ratio. After the calculation there is found that TTSL has do not fixed interest charges in this year, so the Interest coverage ratio of this year is Infinity.

3. Turnover Ratioa) Stock turnover ratioCost of goods sold Stock turnover ratio = Average stock Where average stock refers to arithmetic average of opening and closing stock and cost of goods sold is the difference between net sales and gross profit. Table: 10 Particulars At March31. 2011 Rs. Cost of goods sold Average stock Stock turnover ratio 1599614352.18 82585520.03 19.36 times

x 100000000

20 15 10 5 0 Cost of goods sold Average stock

InterpretationAccording to above statement we can say that stock turnover ratio of Tata Teleservices Ltd. is 19.36 times in March 2011.

b) Debtors turnover ratioNet Credit sales Debtors turnover ratio = Average accounts receivables Where average accounts receivable = (opening debtors and B/R + closing debtors and B/R)/2 Note- debtors have been taken before making any provision for bad and doubtful debts. Table: 11 Particulars At March31. 2011 Rs. Net credit sales Average debtors Debtors turnover ratio 0 0 0 times

1 0.8 0.6 0.4 0.2 0 Net credit sales Average debtors

InterpretationHigher the debtors turnover ratio, the better it is for the organization but Tata Teleservices ltd.s Debtor turnover ratio is zero.

C) Average collection period12 months or 365 days Average collection period = Debtor turnover ratio Table: 12 Particulars At March31. 2011 Rs. Days in year Debtors turnover ratio Average collection period 365 0 0

400 350 300 250 200 150 100 50 0 Days in year Debtors turnover ratio

InterpretationThis ratio indicates the time with in which the amount is collected from debtors and bills receivable. After our research we calculated that at March 2011 Tata Teleservices ltd.s Average collection period is Zero

D) Creditors turnover ratio Net credit purchases Creditors Turnover ratio = Average Account Payable Where average accounts payable = (Opening creditors and opening bills payable + closing creditors and closing bills payable)/2 Table: 13 Particulars At March31. 2011 Rs. Net credit purchases Average creditors Creditors turnover ratio 34390129.25 14723315.65 7.28 Times

35000000 30000000 25000000 20000000 15000000 10000000 5000000 0 Net credit purchases Average creditors

InterpretationThe creditors turnover ratio of Tata Teleservices ltd.s at March 2011 is 7.28 times.

E) Average payment period12 months or 365 days Average payment period = Creditors turnover ratio Table: 14 Particulars At March31. 2011 Rs. Days in year Creditors turnover ratio Average payment period 365 7.28 50.13 days

400 350 300 250 200 150 100 50 0 Days in year Creditors turnover ratio

InterpretationThe Tata Teleservices ltd.s Average payment period is aprox. 50 days.

F) Working capital turnover ratioCost of goods sold Working capital turnover ratio = Working Capital Table: 15 Particulars At March31. 2011 Rs. Cost of goods sold Working capital Working capital turnover ratio 1599614352.18 2109184779.39 0.76 times

x 100000000

25

20

15

10

0 Cost of goods sold Working capital

InterpretationThe working capital turnover ratio of Tata Teleservices ltd.s is 0.76 times.

4.) Profitability RatiosA.) Gross profit ratioGross Profit Gross profit ratio = Net Sales Table: 16 Particulars At March31. 2011 Rs. Gross profit Net sales Gross profit ratio 905212031.58 2504826383.76 36.14% * 100

x 100000000

30 25 20 15 10 5 0 Gross profit Net sales

InterpretationGross profit ratio as a percentage of sales is compounded to have an idea about gross margin. And Tata Teleservices ltd.s Gross profit ratio of this year is 36.14%.

B) Operating RatioCost of sales + operating expenses Operating ratio = Net Sales Table: 17 Particulars At March31. 2011 Rs. Cost of operation Net sales Operating ratio 1934971265.38 2504826383.76 77.29% * 100

x 100000000

30 25 20 15 10 5 0 Cost of operation Net sales