CG Havells Analysis
-
Upload
anushree-khandalkar -
Category
Documents
-
view
229 -
download
0
Transcript of CG Havells Analysis
-
8/3/2019 CG Havells Analysis
1/17
Ratio Analysis
Havells vs Crompton GreavesBy,
Anushree Khandalkar SIMSR MMS-25
Sameepya Hora SIMSR MMS-118Saadat Sheikh SIMSR MMS-55
Aniruddha Bhattacharya SIMSR MMS-106
-
8/3/2019 CG Havells Analysis
2/17
Electrical Equipment Industry
Rs 21000 Crore Industry
Three Major Players :
ABB
Crompton Greaves
Havells India
ACC
29%
Crompton
Greaves
28%
Havells
13%
Others
30%
Market Share
-
8/3/2019 CG Havells Analysis
3/17
1.2 1.24
0.99
1.29 1.28 1.3
Jan/09 Jan/10 Jan/11
Current Ratio
Havells CG
0.81
0.5
0.36
1.12 1.12 1.09
Jan/09 Jan/10 Jan/11
Quick Ratio
Havells CG
-
8/3/2019 CG Havells Analysis
4/17
8.47
1210.46
15.17 14.8413.99
Jan/09 Jan/10 Jan/11
Gross Profit Margin
Havells CG
6.57
9.22
8.028.4
11.32 11.33
Jan/09 Jan/10 Jan/11
Net Profit Margin
Havells CG
-
8/3/2019 CG Havells Analysis
5/17
Havells Crompton Greaves
-
8/3/2019 CG Havells Analysis
6/17
4.47
3.86 3.76
4.254.66
3.93
Jan/09 Jan/10 Jan/11
Asset Turnover Ratio
Havells CG
11.53
7.996.98
17.8818.82
16
Jan/09 Jan/10 Jan/11
Inventory Turnover Ratio
Havells CG
-
8/3/2019 CG Havells Analysis
7/17
Return on Capital Employed
HAVELLS CROMPTON GREAVES
21.67 % 38.58%
Efficiency and profitability of companys
capital investments
ROCE should be greater than rate of
borrowing
-
8/3/2019 CG Havells Analysis
8/17
Accounts Receivable & Accounts
Payable
HAVELLS CROMPTON GREAVES
88.1 82.8
HAVELLS CROMPTON GREAVES
193.4 99.2
Accounts Receivable in days
Accounts Payable in days
-
8/3/2019 CG Havells Analysis
9/17
Raw Material Inventory In days
HAVELLS CROMPTON GREAVES
16.84 17.29
Does not impact much, as both almost same
-
8/3/2019 CG Havells Analysis
10/17
WIP Inventory In days
Higher WIP inventory indicates longer cash
cycle. Cash Gap is high
Need to decrease WIP inventory in order to
improve cash flow High WIP for CG could indicate decrease in
Fixed Asset Turnover ratio
HAVELLS CROMPTON GREAVES
5.29 25.8
-
8/3/2019 CG Havells Analysis
11/17
WIP Inventory In Days Cont.
4.33
7.43
4.3
5.64
Havells CG
Fixed Asset Turnover Ratio
Mar-10 Mar-11
-
8/3/2019 CG Havells Analysis
12/17
Finished Goods Inventory In days
Time taken by company to sell the product itmanufactures
High FG inventory indicates capital tied up.
HAVELLS CROMPTON GREAVES
37.04 4.59
Finished Goods Inventory TurnoverHAVELLS CROMPTON GREAVES
9.85 79.45
-
8/3/2019 CG Havells Analysis
13/17
Inventory Cost / Sales
HAVELLS CROMPTON GREAVES
15.43 11.5
89%
11%
Raw Material - HavellsIndigenous Imported
85%
15%
Raw Material - Crompton GreavesIndigenous Imported
-
8/3/2019 CG Havells Analysis
14/17
RAWMATERIAL
Ratio Havells CromptonGreaves
RAW MATERIAL
CONSUMED / SALES
53.9 % 43.19 %
Raw Material Consumed to Sales Ratio is very low for Crompton Greaves which
indicates that more raw materials are blocked in Work In Progress. The Ratio forHavells is 54% hence less raw materials are blocked in Work In Progress.
RAW MATERIAL
PURCHASED /
EXPENDITURE
65.17% 51.30%
Raw Material Purchased to Expenditure indicates how much of the total expenditure
is attributed to purchasing raw materials. CromtonGreaves has more efficient
processes in comparison to Havells which lowers raw material cost
-
8/3/2019 CG Havells Analysis
15/17
MAINTENANCERatio Havells CromptonGreaves
MAINTENANCE COST /EXPENDITURE
1.34 % 0.59 %
These include parts, supplies, and materials used in or consumed by
routine maintenance and repair of operating equipment, or in support of operations.
Again this cost is high for Havells indicating the scope for reduction.
MANUFACTURING
Ratio Havells CromptonGreaves
MANUFACTURING COST /TOTAL EXPENDITURE
86.22 % 86.37%
-
8/3/2019 CG Havells Analysis
16/17
SPARESRATIO Havells CromptonGreaves
STORES & SPARESCONSUMED / SALES
0.0082 % 0.0077 %
The Stores & Spares Consumed to Sales ration is approximately same for both the
companies
R&DRatio Havells CromptonGreaves
R&D EXPENSE / SALES 0.24 % 0.95 %
The R&D expense ration is high for Crompton Greaves indicating they put more focus
on innovation & new product development as compared to Havells.
-
8/3/2019 CG Havells Analysis
17/17
SCRAP
Ratio Havells CromptonGreaves
SCRAP SALE / TOTAL SALES 0.62 % 0.92 %
Havells has 0.62% of sales attributed to selling of scrap which is better as compared
to Crompton Greave as Havells has less scrap which is a undesired result from
manufacturing.