alkyl amines chemicals ltd (ratio)
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Alkyl Amines Chemicals Ltd
2. Liquidity Ratio
2.1 Current ratio
Current assets
Current ratio = --------------------------
Current liabilities
PARTICULAR 2014 2013 2012 20111 2010
Current Assets 214.43 179.71 131.69 109.95 120.1
Current Liability 74.75 58.75 42.27 33.57 34.04
Current Ratio 2.86 3.05 3.12 3.27 3.52
Particu-lar
2014 2013 2012 2011 20100
0.10.20.30.40.50.60.70.80.9
Series3Series2Series1
Interpretation:
Current Ratio of the Alkyl Amines Chemicals is 2.86 in the current year and it is lower then the
previous 3 years. Reason is that the company has changed their R&D department. The higher
current ration show the healthy business so from this ration shareholder are aware that
company has able to fulfill their liabilities.
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2.2 Quick Ratio
Quick ratio, also called acid –test ratio, establishes a relationship between quick, or liquid,
assets and current liabilities. An asset is liquid if it can be converted into cash is the most
liquid asset.
Current assets – InventoriesQuick ratio = ---------------------------------------------
Current liabilities
PARTICULAR 2014 2013 2012 20111 2010
Current Assets - inventories
131.71 107.02 81.96 57.99 64.48
Current Liability 74.75 58.75 42.27 33.57 34.04
Quick ratio 1.77 1.83 1.93 1.72 1.89
Particu-lar
2014 2013 2012 2011 20100
0.10.20.30.40.50.60.70.80.9
Series3Series2Series1
Interpretation:
Quick Ratio is an indicator of company's short-term liquidity. A common rule of thumb is
that companies with a quick ratio of greater than 1.0 are sufficiently able to meet their
short-term liabilities. Here the Quick Ratio is 1.77, which is more than 1.
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2. Cash Ratio
Since cash is the most liquid asset, a financial analyst may examine cash ratio and its
equivalent to current liabilities. Trade investment or marketable securities are equivalent of
cash; therefore, they may be included in the computation of cash ratio:
Cash + Marketable securities Cash ratio = -------------------------------------------
Current liabilities
PARTICULAR 2014 2013 2012 20111 2010
Cash +Marketable securities
22.86 15.44 11.07 1.26 3.33
Current Liability 74.75 58.75 42.27 33.57 34.04
Cash ratio 0.31 0.26 0.26 0.03 0.09
Par-ticular
2014 2013 2012 2011 20100
0.10.20.30.40.50.60.70.80.9
Series3Series2Series1
Interpretation:
The cash ratio is most commonly used as a measure of company liquidity. It can therefore
determine if, and how quickly, the company can repay its short-term debt. A cash ratio of
1.00 and above means that the business will be able to pay all its current liabilities in
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immediate short term. But here this industry is not able to pay all its current liabilities in
immediate short term.
3. Debt Ratio
Several debt ratios may be used to analyze the long-term solvency of a firm. The firm may be interested in knowing the proportion of the interest-bearing debt in the capital structure.
Total debt Debt ratio = ------------------------ Net Assets
PARTICULAR 2014 2013 2012 20111 2010
Total Debt 150.64 146.01 123.41 120.08 113.58
Net Assets 139.68 120.96 89.42 76.38 86.06
Debt Ratio 1.07 1.20 1.38 1.57 1.31
Par-ticular
2014 2013 2012 2011 20100
0.10.20.30.40.50.60.70.80.9
Series3Series2Series1
Interpretation:
The Debt Ration if Higher than the previous 3 years. here ratio is high so the leverage used
by company is also high.
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4. Debtors turnover
A firm sells goods for cash and credit is used as a marketing tool by a number of companies.
Sales Debtors turnover = ----------------------
Debtors
PARTICULAR 2014 2013 2012 20111 2010
Sales 89.8 75.97 60.36 47.33 38.98
Debtors 480.86 395.88 308.32 252.81 232.86
Debtors turnover 0.18 0.19 0.19 0.18 0.16
Par-ticular
2014 2013 2012 2011 20100
0.10.20.30.40.50.60.70.80.9
Series3Series2Series1
Interpretation:
Higher debtor turnover ratio is good because more higher debtor turnover ratio means,
more soon, we are collecting Money. Lower debtor turnover ratio is not good because it
tells us that we have not manage debtors better ways. Money from debtors are not collected
Soon. Here, Debtor Ration is lower so we can say that collecting the money process is low
from this company.
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5. Assets turnover RatiosAssets are used to generate sales. Therefore, a firm should manage its assets efficiently to
maximize sales. The relationship between sales and assets is called assets turnover.
Several assets turnover ratios can be calculated.
Sales Net assets turnover = -------------------------- Net assets
PARTICULAR 2014 2013 2012 20111 2010
Sales 89.8 75.97 60.36 47.33 38.98
Net assets 139.68 120.96 89.42 76.38 86.06
Net assets turnover 0.65 0.62 0.68 0.61 0.45
Particu-lar
2014 2013 2012 2011 20100
0.10.20.30.40.50.60.70.80.9
Series3Series2Series1
Interpretation:
It is an efficiency ratio which tells how successfully the company is using its assets to
generate revenue. If a company can generate more sales with fewer assets it has a higher
turnover ratio which tells it is a good company because it is using its assets efficiently and
vise a versa. Here, turnover ratio is high so we can say that company using their assets
effectively and efficiently.
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6. Gross profit Margin The first profitability ratio in relation to sales is the gross profit margin. It is calculated by
dividing the gross profit by sales:
Gross profit Gross profit margin = --------------------- Sales
PARTICULAR 2014 2013 2012 2011 2010
Gross profit 74.36 45.96 32.59 22.78 23.39
Sales 89.8 75.97 60.36 47.33 38.98
Gross profit margin 0.83 0.61 0.53 0.48 0.57
Particu-lar
2014 2013 2012 2011 20100
0.10.20.30.40.50.60.70.80.9
Series3Series2Series1
Interpretation:High gross profit margin indicates that the company can make a reasonable profit, as long
as it keeps the overhead cost in control. Low gross profit margin indicates that the business
is unable to control its production cost. Gross margin ratio is a profitability ratio that
measures how profitable a company can sell its inventory. It only makes sense that higher
ratios are more favorable. Higher ratios mean the company is selling their inventory at a
higher profit percentage. Here, this ratio is higer than the previous year ratio.
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