Nestle India s

---------------
---- in Rs.
Cr.
---------------
Balance Sheet ----
Dec '04 Dec '05 Dec '06 Dec '07

12 mths 12 mths 12 mths 12 mths

Sources Of Funds
Total Share Capital 96.42 96.42 96.42 96.42
Equity Share Capital 96.42 96.42 96.42 96.42
Share Application Money 0 0 0 0
Preference Share Capital 0 0 0 0
Reserves 222.99 257.72 292.47 322.01
Revaluation Reserves 0 0 0 0
Networth 319.41 354.14 388.89 418.43
Secured Loans 7.91 14.3 16.27
Unsecured Loans 0 0 0 0
Total Debt 7.91 14.3 16.27 2.87
Total Liabilities 327.32 368.44 405.16 421.3
Dec '04 Dec '05 Dec '06 Dec '07

12 mths 12 mths 12 mths 12 mths

Application Of Funds
Gross Block 838.16 942.4 1,058.27 1,179.77
Less: Accum. Depreciation 440.94 468.63 516.48 577.96
Net Block 397.22 473.77 541.79 601.81
Capital Work in Progress 34.09 22.83 38.24 73.7
Investments 154.86 104.43 77.77 94.4
Inventories 216.67 253.1 276.22 401.22
Sundry Debtors 26.17 30.52 55.76 53.49
Cash and Bank Balance 9.45 3.64 6.53 15.75
Total Current Assets 252.29 287.26 338.51 470.46
Loans and Advances 168.91 194.33 175.12 186.23
Fixed Deposits 0 33 69.82 22.01
Total CA, Loans & Advances 421.2 514.59 583.45 678.7
Deffered Credit 0 0 0 0
Current Liabilities 331.18 381.68 440.82 529.51
Provisions 348.87 365.5 395.28 497.79
Total CL & Provisions 680.05 747.18 836.1 1,027.30
Net Current Assets -258.85 -232.59 -252.65 -348.6
Miscellaneous Expenses 0 0 0 0
Total Assets 327.32 368.44 405.15 421.31
Contingent Liabilities 10.39 50.04 35.93 63.27
Book Value (Rs) 33.13 36.73 40.33 43.4
Dec '08

12 mths

96.42
96.42
0
0
376.93
0
473.35
0.82
0
0.82
474.17
Dec '08

12 mths

1,404.85
651.85
753
109.17
34.9
434.91
45.59
12.66
493.16
162.67
181.03
836.86
0
582.44
677.32
1,259.76
-422.9
0
474.17
 84.9
49.09
 ---------------
---- in Rs.
Cr.
---------------
Profit & Loss account ----
Dec '04 Dec '05 Dec '06 Dec '07

12 mths 12 mths 12 mths 12 mths

Income
Sales Turnover 2,373.17 2,643.96 2,944.20 3,647.49
Excise Duty 143.75 168.87 125.04 146.53
Net Sales 2,229.42 2,475.09 2,819.16 3,500.96
Other Income 8.21 23.67 15.33 21.24
Stock Adjustments 6.55 16.73 13.42 71.01
Total Income 2,244.18 2,515.49 2,847.91 3,593.21
Expenditure
Raw Materials 1,047.99 1,135.80 1,348.21 1,763.54
Power & Fuel Cost 85.07 103.91 115.56 123.94
Employee Cost 164.25 183.29 216.16 269.44

Other Manufacturing Expenses 41.08 49.06 52.65 62.14

Selling and Admin Expenses 423.06 460.53 480.14 496.22
Miscellaneous Expenses 42.76 56.78 87.55 172.54
Preoperative Exp Capitalised 0 0 0 0
Total Expenses 1,804.21 1,989.37 2,300.27 2,887.82
Dec '04 Dec '05 Dec '06 Dec '07

12 mths 12 mths 12 mths 12 mths

Operating Profit 431.76 502.45 532.31 684.15

PBDIT 439.97 526.12 547.64 705.39
Interest 0.78 0.21 0.44 0.85
PBDT 439.19 525.91 547.2 704.54
Depreciation 49.14 56.84 66.28 74.74
Other Written Off 0 0 0 0
Profit Before Tax 390.05 469.07 480.92 629.8
Extra-ordinary items 0 0 0 0
PBT (Post Extra-ord Items) 390.05 469.07 480.92 629.8
Tax 134.58 159.49 165.43 214.8
Reported Net Profit 251.92 309.57 315.1 413.81
Total Value Addition 756.21 853.58 952.06 1,124.29
Preference Dividend 0 0 0 0
Equity Dividend 236.22 241.04 245.86 318.17

Corporate Dividend Tax 31.29 33.81 34.48 52.21

Per share data (annualised)
Shares in issue (lakhs) 964.16 964.16 964.16 964.16
Earning Per Share (Rs) 26.13 32.11 32.68 42.92
Equity Dividend (%) 245 250 255 330
Book Value (Rs) 33.13 36.73 40.33 43.4
Dec '08

12 mths

4,472.04
143.39
4,328.65
29.88
31.11
4,389.64

2,153.85
159.76
314.58

73.46
736.73
81.4
0
3,519.78
Dec '08

12 mths

839.98
869.86
1.64
868.22
92.36
0
775.86
0
775.86
238.74
534.08
1,365.92
0
409.77

69.64
964.16
55.39
425
49.09
 Dec '04 Dec '05

12 mths 12 mths
Profitability Ratios Dec '04 Dec '05
1 Profit Margin Ratio = Profit After Tax/ Sales 11.2997999 12.50742397
2 Asset Turnover Ratio = Sales/Total Assets 6.81 6.72
3 Return on Assets =Profit Margin Ratio* Asset Turnover Ratio 76.9644385 84.02182173
4 Return on Equity = Profit After Tax /Avg. shareholder's Equity 2.61273595 3.210640946
5 Return On Net Worth=Profit After Tax / Net Worth 78.8704173 87.4145818

Liquidity Ratios Dec '04 Dec '05

1 Current Ratio = Current Assets / Current Liabilities 0.61936622 0.688709548
2 Quick Ratio=(Current Assets - Inventories)/ Current Liabilities 0.3007573 0.349969218
3 Debtor Turnover Ratio = (sales / Debtors) 85.1899121 81.09731324
4 Inventory Turnover Ratio = Cost of goods Sold / Inventories 10.9529238 10.44630581
5 Total Asset Turnover Ratio = Sales/ Total Assets 6.81113284 6.717755944

Solvency Ratios Dec '04 Dec '05

1 Debt to Equity Ratio= Total Debt / Shareholder's Equity 0.08203692 0.148309479
2 Interest Cover Ratio= PBIT / Interest Expense 501.064103 2234.666667

Capital Market Ratios Dec '04 Dec '05

1 Earnings Per Share (EPS) 26.13 32.11
2 Dividend Per share= Equity Dividend/No. of shares 24.500083 25
3 Operating Profit Per Share = Operating Profit / No. of shares 44.7809492 52.11271988
 Dec '06 Dec '07 Dec '08

12 mths 12 mths 12 mths

Dec '06 Dec '07 Dec '08
11.17708821 11.81990083 12.33825789
6.96 8.31 9.13
77.77366408 98.21983812 112.6347091
3.267994192 4.291744451 5.539099772
81.02548278 98.89587267 112.8298299

Dec '06 Dec '07 Dec '08

0.697823227 0.660663876 0.664301137
0.367456046 0.270106103 0.319068712
50.55882353 65.45073846 94.94735688
10.65889508 9.090997458 10.28267918
6.958311736 8.309700695 9.128898918

Dec '06 Dec '07 Dec '08

0.168740925 0.029765609 0.00850446
1094 741.9411765 474.0853659

Dec '06 Dec '07 Dec '08

32.68 42.92 55.39
25.49991703 32.99970959 42.50020743
55.20971623 70.95813973 87.12039496
 RATIO ANALYSIS

A .Current Ratio:-

Importance: It indicates the firms short term solvency position. A ratio of 2:1 is considered as ideal. If the ratio
is less than one the firm faces problems in meeting its short term obligations. Hence it is so important for every
organization.
Interpretation: The current ratio of firm is well below the satisfactory level of 2:1 at around 0.6 indicating the shortfall of
liquidity in the firm which need to be accounted for.

B .Quick Ratio:-

Importance: As stock may not be converted in to cash quickly we can not measure the firm’s efficiency in
meeting its obligations. Quick ratio is more accurate method than Current ratio and is more useful. The ideal
ratio is 1:1.
Interpretation: The quick ratio which is a better indicator of the liquidity position of the firm is again considerably less than
the ideal level. The firm needs to considerably improve its liquidity positon.

C .Debt-Equity Ratio:-

Importance: It indicates the relationship between the long term loans and share holders funds. So it is much
important in the view of invester. It gives the information about the relation between the owners funds to the
share holders funds. There’s no ideal ratio.
Interpretation: The debt-equity ratio has considerably come down from the high of year 2006 to 2008 owing to decrease
in the role of debt in the capital structure.

D.Debtor Turnover Ratio:

This measures the efficacy of a firm's credit and collectionpolicy and shows the no of times each year the debtor turns
into cash .Higher the ratio the better it is.it kept decreasing till 2006 but again start rising and became highest in 2008
which is a good sign for the company.

E.Inventory Turnover Ratio:

Importance: By determining this ratio we can know the cost of goods sold, with this we can restrict our CGS.

This ratio is almost constant which shows that company is turning its inventories into finished goods at a constant pace
which is satisfactory.The Net Sales have almost doubled in the given 5 years which is very good.

F.Profit Margin Ratio:

This represents the profit made on sales.This should be as high as possible.The profit margin is increasing for the company
which is a good sign.

G. Asset turnover ratio

This represents how well the company is utilising its assets. As this ratio is increasing , this means company is ultilising its
assetsmore efficiently.

H.Return on Equity
This ratio is improtant from shareholders point of view. More it will be better it is , as it's is increasring this is good for the
investors

I.Return on assets
This is profit after tax divided by total assets . It represents profit made per unit of total assets, this should be high, as
over the years this is increasing implying positive.

J. Interest cover ratio

this shows the ability of the company to pay interest on debt , if it's high credit rating of the company is high and it's easy
for the company to raise debt in future , this is increasing so it's better.
 Profit Margin Ratio = Profit After Asset Turnover Ratio = Sales/To
Tax/ Sales Assets
13 10.00
12.5 Profit Margin Ratio = 8.00 Asset Turnove
Profit After Tax/ Sales = Sales/Total A
12 6.00
11.5 4.00
11 2.00

10.5 0.00
1 2 3 4 5 1 2 3 4 5

Return on Assets =Profit Margin Return on Equity = Profit Afte

Ratio* Asset Turnover Ratio Tax /Avg. shareholder's Equit
120 6
100 5
Return on Assets Return on Equ
80 =Profit Margin Ratio* 4 Profit After Tax
Asset Turnover Ratio shareholder's E
60 3
40 2
20 1
0 0
1 2 3 4 5 1 2 3 4 5

Return On Net Worth=Profit After Current Ratio = Current Assets

Tax / Net Worth Current Liabilities
120 0.72
100 0.7
Return On Net Current Ra
80 Worth=Profit After 0.68 Current As
Tax / Net Worth 0.66 Current Lia
60
0.64
40 0.62
20 0.6
0 0.58
1 2 3 4 5 1 2 3 4 5

Quick Ratio=(Current Assets - Debtor Turnover Ratio = (sales

Inventories)/ Current Liabilities Debtors)
0.4 100
0.35 Quick Ratio=(Current Debtor Tu
0.3 80
Assets - Inventories)/ Ratio = (sa
 Quick Ratio=(Current Assets - Debtor Turnover Ratio = (sales
Inventories)/ Current Liabilities Debtors)
0.4 100
0.35 Quick Ratio=(Current Debtor Tu
0.3 80
Assets - Inventories)/ Ratio = (sa
0.25 Current Liabilities 60 Debtors)
0.2
0.15 40
0.1 20
0.05
0 0
1 2 3 4 5 1 2 3 4 5

Debt to Equity Ratio= Total Debt / Interest Cover Ratio= PBIT / Inte
Shareholder's Equity Expense
0.18 2500
0.16
0.14 Debt to Equity Ratio= 2000 Interest Cove
Total Debt / PBIT / Interes
0.12 Shareholder's Equity
0.1 1500 Expense
0.08
0.06 1000
0.04 500
0.02
0 0
1 2 3 4 5 1 2 3 4 5

Earnings Per Share (EPS) Dividend Per share= Equity

60 Dividend/No. of shares
50 50
Earnings Per Share Dividend Pe
40 40 Equity Divid
(EPS) of shares
30 30
20 20
10 10
0 0
1 2 3 4 5 1 2 3 4 5

Operating Profit Per Share =

Operating Profit / No. of shares
100
80 Operating Profit Per
Share = Operating
60 Profit / No. of shares

40
20
0
1 2 3 4 5
80 Operating Profit Per
Share = Operating
60 Profit / No. of shares

40
20
0
1 2 3 4 5
er Ratio = Sales/Total

Asset Turnover Ratio

= Sales/Total Assets

4 5

Equity = Profit After

hareholder's Equity

Return on Equity =
Profit After Tax /Avg.
shareholder's Equity

4 5

o = Current Assets /
ilities

Current Ratio =
Current Assets /
Current Liabilities

4 5

nover Ratio = (sales /

Debtor Turnover
Ratio = (sales /
nover Ratio = (sales /

Debtor Turnover
Ratio = (sales /
Debtors)

4 5

r Ratio= PBIT / Interest

Interest Cover Ratio=

PBIT / Interest
Expense

4 5

Per share= Equity

/No. of shares
Dividend Per share=
Equity Dividend/No.
of shares

4 5