Yamaha ratio analysis

RATIO ANALYSIS AND INTERPRETATION

RD350

COMPANY PROFILE

ABOUT INDIA YAMAHA MOTOR PVT. LTD.

•Yamaha made its initial foray into India in 1985. Subsequently, it entered into a 50:50 joint-venture with the Escorts Group in 1996.• However, in August 2001, Yamaha acquired its remaining stake becoming a 100% subsidiary of Yamaha Motor Co., Ltd, Japan (YMC).• In 2008, Mitsui & Co., Ltd. entered into an agreement with YMC to become a joint-investor in the motorcycle manufacturing company "India Yamaha Motor Private Limited (IYM)".ICURRENT SCENARIO

Yamaha continues to soar high, Domestic Sales up by 35.2 % in September.Sep 06, 2011Yamaha zips ahead with the launch of the YZF-R15 version 2.0Sep 05, 2011Fourth Leg of Yamaha YZF-R15 One Make Race - Season 2011 rounds off in style.Sep 01, 2011Yamaha upbeat about upcoming festive season, registers a domestic sales growth of 32% in August.Aug 01, 2011Yamaha continues to ride high on sales in July 2011.

Mar '11 Mar '10 Mar '09 Mar '08 Mar '07

Sources Of Funds Total Share Capital 289.37 144.68 144.68 144.68 101.18

Equity Share Capital 289.37 144.68 144.68 144.68 101.18

Share Application Money 0 0 0 0 0

Preference Share Capital 0 0 0 0 0

Reserves 4,620.85 2,783.66 1,725.01 1,442.91 5,433.14

Revaluation Reserves 0 0 0 0 0

Networth 4,910.22 2,928.34 1,869.69 1,587.59 5,534.32

Secured Loans 23.53 12.98 0 6.95 22.46

Unsecured Loans 301.62 1,325.60 1,570.00 1,327.39 1,602.97

Total Debt 325.15 1,338.58 1,570.00 1,334.34 1,625.43

Total Liabilities 5,235.37 4,266.92 3,439.69 2,921.93 7,159.75

Application Of Funds Gross Block 3,395.16 3,379.25 3,350.20 2,994.68 3,178.54

Less: Accum. Depreciation 1,912.45 1,899.66 1,807.91 1,726.07 1,904.94

Net Block 1,482.71 1,479.59 1,542.29 1,268.61 1,273.60

Capital Work in Progress 149.34 120.84 106.48 34.74 107.62

BALANCE SHEET

Investments 4,795.20 4,021.52 1,808.52 1,857.14 6,447.53Inventories 547.28 446.21 338.84 349.61 309.7Sundry Debtors 362.76 272.84 358.65 275.31 529.83Cash and Bank Balance 155.45 100.2 135.68 54.74 62.16

Total Current Assets 1,065.49 819.25 833.17 679.66 901.69

Loans and Advances 3,891.66 2,291.29 1,567.09 1,099.68 2,925.24

Fixed Deposits 401.04 1.21 1.19 1.33 21.32Total CA, Loans & Advances

5,358.19 3,111.75 2,401.45 1,780.67 3,848.25

Deffered Credit 0 0 0 0 0Current Liabilities 2,624.35 2,218.06 1,378.20 1,185.19 1,683.46Provisions 3,925.72 2,248.72 1,224.15 834.04 2,833.79Total CL & Provisions 6,550.07 4,466.78 2,602.35 2,019.23 4,517.25

Net Current Assets -1,191.88 -1,355.03 -200.9 -238.56 -669

Miscellaneous Expenses 0 0 183.3 0 0

Total Assets 5,235.37 4,266.92 3,439.69 2,921.93 7,159.75Contingent Liabilities 959.66 818.25 924.96 1,129.29 811.66

Book Value (Rs) 169.69 202.4 129.23 109.73 546.96

PROFIT AND LOSS ACCOUNT


Income

Sales Turnover 17,386.51 12,420.95 9,310.24 9,856.66 10,741.91

Excise Duty 934.71 607.7 610.07 1,029.51 1,321.67

Net Sales 16,451.80 11,813.25 8,700.17 8,827.15 9,420.24

Other Income 1,176.00 22.5 -6.2 170.27 567.16

Stock Adjustments 82.79 47.6 -24.49 67.85 -0.9

Total Income 17,710.59 11,883.35 8,669.48 9,065.27 9,986.50

Expenditure

Raw Materials 11,965.30 8,187.11 6,502.10 6,760.04 6,969.50

Power & Fuel Cost 86.61 70.35 60.89 69.2 79.34

Employee Cost 494.33 411.76 366.67 350.09 310.07

Other Manufacturing Expenses 61.77 57.54 57.08 53.72 74.53

Selling and Admin Expenses 450.18 407.61 381.73 390.15 457.17

Miscellaneous Expenses 237.76 221.94 225.56 209.63 230.89

Preoperative Exp Capitalised -16.66 -15.67 -14.42 -23.04 -32.05

Total Expenses 13,279.29 9,340.64 7,579.61 7,809.79 8,089.45

Operating Profit 3,255.30 2,520.21 1,096.07 1,085.21 1,329.89

PBDIT 4,431.30 2,542.71 1,089.87 1,255.48 1,897.05

Interest 1.69 5.98 21.01 5.16 5.34

PBDT 4,429.61 2,536.73 1,068.86 1,250.32 1,891.71

Depreciation 122.84 136.45 129.79 173.96 190.26

Other Written Off 0 0 0 1.12 0.39

Profit Before Tax 4,306.77 2,400.28 939.07 1,075.24 1,701.06

Extra-ordinary items 46.77 26.87 18.72 59.32 26.6

PBT (Post Extra-ord Items) 4,353.54 2,427.15 957.79 1,134.56 1,727.66

Tax 1,011.02 710.12 301.61 378.78 490.09

Reported Net Profit 3,339.73 1,702.73 656.48 755.95 1,237.96

Total Value Addition 1,313.99 1,153.53 1,077.51 1,049.75 1,119.95

Preference Dividend 0 0 0 0 0

Equity Dividend 1,157.47 578.73 318.3 289.37 404.73Corporate Dividend

Tax 187.77 96.12 54.1 49.18 68.78

Per share data (annualized)

Shares in issue (lakhs) 2,893.67 1,446.84 1,446.84 1,446.84 1,011.84

Earnings Per Share (Rs) 115.42 117.69 45.37 52.25 122.35

Equity Dividend (%) 400 400 220 200 400

Book Value (Rs) 169.69 202.4 129.23 109.73 546.9

Mar, 11 Mar , 10 Mar , 09 Mar , 08 Mar , 07Investment Valuation RatiosFace Value 10 10 10 10 10Dividend Per Share 40 40 22 20 40Operating Profit Per Share (Rs) 112.4 173.02 75.64 75.01 131.39Net Operating Profit Per Share (Rs) 568.54 816.49 601.32 610.1 931.01Free Reserves Per Share (Rs) 158.97 190.09 106.56 99.73 535.16Bonus in Equity Capital 89.45 78.91 78.91 78.91 112.84Profitability RatiosOperating Profit Margin (%) 19.76 21.19 12.57 12.29 14.11

Profit Before Interest And Tax Margin (%) 18.56 19.78 10.88 10.03 11.65Gross Profit Margin (%) 19.02 20.03 11.08 10.32 12.09Cash Profit Margin (%) 15.7 16.2 10.55 10.48 12.18Adjusted Cash Margin (%) 15.7 16.2 10.55 10.48 12.18Net Profit Margin (%) 19.8 14.23 7.4 8.32 12.66Adjusted Net Profit Margin (%) 19.8 14.23 7.4 8.32 12.66Return On Capital Employed (%) 67.57 59.01 32.8 39.71 20.9Return On Net Worth (%) 68.01 58.14 38.92 47.61 22.36Adjusted Return on Net Worth (%) 51.42 61.53 47.78 48.91 18.09

Return on Assets Excluding Revaluations 169.69 202.4 116.56 109.73 546.96

Return on Assets Including Revaluations 169.69 202.4 116.56 109.73 546.96Return on Long Term Funds (%) 69.67 59.19 35.36 39.71 20.97

RATIO INTERPRETATION

Liquidity And Solvency Ratios Current Ratio 0.8 0.69 0.84 0.88 0.84Quick Ratio 0.71 0.55 0.73 0.64 0.76Debt Equity Ratio 0.07 0.46 0.84 0.84 0.29Long Term Debt Equity Ratio 0.03 0.45 0.71 0.84 0.29Debt Coverage RatiosInterest Cover 2,093.39 421.06 53.71 224.91 280.28Total Debt to Owners Fund 0.07 0.46 0.84 0.84 0.29Financial Charges Coverage Ratio 2,166.08 443.88 59.89 258.84 315.98

Financial Charges Coverage Ratio Post Tax 2,049.86 308.56 38.42 181.43 268.53Management Efficiency RatiosInventory Turnover Ratio 32.8 28.87 28.64 29.33 36.88Debtors Turnover Ratio 51.77 37.41 27.45 21.93 22.66Investments Turnover Ratio 32.8 28.87 28.64 29.33 36.88Fixed Assets Turnover Ratio 4.85 3.5 2.6 2.95 2.96Total Assets Turnover Ratio 3.14 2.77 2.53 3.02 1.32Asset Turnover Ratio 4.85 3.5 2.6 2.95 2.96Average Raw Material Holding 5.58 7.91 6.39 5.24 5.08Average Finished Goods Held 9.15 9.13 9.97 10.73 8.14

Number of Days In Working Capital -26.08 -41.29 -8.31 -9.73 -25.57Profit & Loss Account Ratios Material Cost Composition 72.72 69.3 74.73 76.58 73.98Imported Composition of Raw Materials Consumed 4.06 3.59 2.35 2.37 5.56

Selling Distribution Cost Composition 2.45 3.23 3.97 3.98 4.45

Expenses as Composition of Total Sales 27.74 27.67 30.82 23.53 18.36Cash Flow Indicator Ratios Dividend Payout Ratio Net Profit 40.27 39.63 56.72 44.78 38.24

Dividend Payout Ratio Cash Profit 38.85 36.69 47.36 36.36 33.14Earning Retention Ratio 46.73 62.55 53.79 56.41 52.71Cash Earning Retention Ratio 49.2 65.19 60.2 64.43 60.28Adjusted Cash Flow Times 0.12 0.69 1.68 1.4 1.36Earnings Per Share 115.42 117.69 45.37 52.25 122.35Book Value 169.69 202.4 129.23 109.73 546.96


0.8 0.690000000000002

0.840000000000001

0.8800000000000010.8400000

00000001

Current Ratio

Current Ratio

INTERPRETATION

The ideal figure should always be greater than 1.The company has a current ratio of 0.8 and it should look to improve it. The higher the better.

The relationship between current assets and current liabilities is called current ratio. It is a measure of general liquidity and is most widely used to make the INTERPRETATION for short term financial position or liquidity of a firm.

Current Ratio = Current Assets / Current Liabilities


0.710000000000001

0.55

0.7300000000000010.6400000

00000003

0.760000000000003

Liquid Ratio

Liquid Ratio

INTERPRETATION

A Company’s liquidity ratio should ideally be more than

1.a liquidity ratio of 1:1 is considered satistaftory.since the ratio is 0.71 the company needs to work on its liquidity

ratio.

It is the ratio of liquid assets to current liabilities. The true liquidity refers to the ability of a firm to pay its short term obligations as and when they become due.

Liquid Ratio = Liquid Assets / Current Liabilities


32.828.87 28.64 29.33

36.88Inventory Turnover Ratio

INTERPRETATION

The higher the better. A higher inventory turnover

ratio shows either strong sales or ineffective buying.

This ratio is a relationship between the cost of goods sold during a particular period of time and the cost of average inventory during a particular period. This ratio

indicates whether investment in stock is within proper limit or not.

Inventory Turnover Ratio = Cost of goods sold / Average inventory at cost

Inventory turnover ratio


0.07

0.46

0.840000000000001

0.840000000000001

0.29

Debt Equity Ratio

INTERPRETATION

Debt Equity Ratio

INTERPRETATION

Manufacturing companies tend to have a debt equity ratio of

above 2.The company has a debt-equity ratio of 0.7 which means

the company is not been wanting to take risks.

Debt-to-Equity ratio indicates the relationship between the external equities or outsiders funds and the internal equities or shareholders funds.

Debt Equity Ratio = External Equities / Internal Equities


19.8

14.23

7.4 8.32

12.66

Net Profit Margin(%)

Net Profit ratio

INTERPRETATION

This ratio also indicates the firms capacity to face adverse economic conditions such as

low demand price competition etc.

Net profit ratio is the ratio of net profit (after taxes) to net sales. It is expressed as percentage. The two basic components of the net profit ratio are the net profit and sales. The net profits are obtained after deducting income-tax and, generally, non -

operating expenses and incomes are excluded from the net profits for calculating this ratio.

Net Profit Ratio = (Net profit / Net sales) × 100

Gross profit ratio

INTERPRETATION

Gross profit margin is fluctuating ,till 2010 Yamaha

was enjoying good profits but again profit went down in

2011.


5

10

15

20

25

19.0220.03

11.08 10.3212.09

Gross Profit Margin(%)

Gross Profit Margin(%)

Gross profit ratio (GP ratio) is the ratio of gross profit to net sales expressed as a percentage. It expresses the relationship between gross profit and sales.

YAMAHA’S FINANCIAL POSITION IS NOT AS PER STD.

WORKING CAPITAL RATIO IS NEGATIVE FOR ALL THE YEAR WHICH IS NOT GOOD FOR THE COMPANY

CURRENT RATIO AND LIQUID RATIO IS ALSO SHOWING A DECREASING TREND

YAHAMA SHOULD TRY TO IMPROVE ITS CURRENT RATIO

Conclusion

Yamaha ratio analysis

Economy & Finance

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