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Financial Analysis
Financial Analysis refers to an assessment of the viability, stability and profitability of a business.
Purpose to do Financial Analysis
To know the earning capacity or profitability. To know the financial strengths. To know the trend of business. To know the efficiency of management. To provide the useful information to management.
Ratio Analysis
Ratios are well known and most widely used tools of financial analysis. A ratio gives the mathematical relationship between one variable and another. Accounting ratios are relationships, expressed in quantitative terms between figures which have a cause and effect relationship or which are connected with each other in some manner or the other.
Current Ratio
A liquidity ratio that measures a company's ability to pay short-term obligations. The Current Ratio formula is:
Current Ratio
0.9 0.8 0.7 0.6 0.5
0.4
0.3 0.2 0.1 0 Mar '13 Mar '12 Mar '11 Mar '10 Mar '09
Current Ratio
4
2 0 Mar '13 Mar '12 Mar '11 Mar '10 Mar '09
30
20 10 0 Mar '13 Mar '12 Mar '11 Mar '10 Mar '09
Learning Outcomes
How to maintain the statements.
Highlights Net profit Rs.6,726 crore. An increase of 30.2% compared to the previous year. Balance sheet size: Rs 400,332 crore. An increase of 18.5% compared to the previous year. Total deposits: Rs 296,247 crore. An increase of 20.1% compared to the previous year. Total advances: Rs 239,721 crore. An increase of 22.7% compared to the previous year.