Table of Contents

Introduction....................................................................................................................................3
Products.......................................................................................................................................3
Objectives.......................................................................................................................................4
Methodologies................................................................................................................................4
Profitability Ratios.........................................................................................................................4
Profit Margin Ratio....................................................................................................................5
Return on Equity........................................................................................................................6
Return on Asset..........................................................................................................................7
Asset Utilization Ratios..............................................................................................................8
Receivable Turnover..................................................................................................................8
Average Collection Period.........................................................................................................9
Inventory Turnover..................................................................................................................10
Fixed Asset Turnover...............................................................................................................11
Total Asset Turnover...............................................................................................................12
Liquidity Ratio..........................................................................................................................13
Current Ratio............................................................................................................................13
Quick Ratio...............................................................................................................................14
Debt Utilization Ratio..............................................................................................................15
Debt to Total Asset...................................................................................................................15
Times Interest Earned..............................................................................................................16
Fixed Charge Coverage Ratio.................................................................................................17
Conclusion....................................................................................................................................18
 Introduction

aamra networks limited over the last decade has consistently provided its customers with state-
of-the-art ISP, IOT, IT & ITES solutions. Clients have been able to rely on their ability to
provide stable and consistent connectivity solutions. Using the state-of-the-art backbone and
infrastructure, they have ensured that clients have had minimal worry when it comes to
dependability and reliability. That in turn has ensured us an enviable list of blue-chip customers.
When Internet and related value-added services are critical input to business, corporate
Bangladesh has but only one obvious choice-aamra.

With more than 300+ employees spread nationwide, they are forever dedicated to serve public
and private B2B clients of Bangladesh. As a commitment to nation and economy, aamra
networks limited is listed as a public limited company in Dhaka and Chattogram Stock
Exchange.

aamra networks limited is one of the 18 concerns of aamra companies. Starting its journey in
1985 and start commercial operation in 14th march 1990. The group of company was started 1000
million authorized share capital and 554 million paid-up share capital with 10,898 shareholder.
group has diversified investment in ICT, Textile, and Lifestyle sectors in Bangladesh.

Products
 IT Infrastructure Management
 IPLC & IPVPN
 Internet
 Hosted Anti-Spam Firewall
 Biometric Attendance System
 Wide Area Network (WAN)
 Network Monitoring
 Remote Video Surveillance.
 Video Conferencing
 Managed Services

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 Call Center Solution.

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 Objectives

The main objectives of this report are:

 To calculate all ratio based on their annual report.
 This report helps in determining how efficiently this organization is operating.
 Ratio analyses are done with the help of 2016-2020 s annual report.
 Also compared these five years ratio.
 This comparison shows up and downs of the organization.
 Explained the position of aamara network in 2020s pandemic situation.

Methodologies

The two primary methods for data analysis are qualitative data analysis techniques and
quantitative data analysis techniques. In here quantitative data are used to calculate all the ratios
and these ratios also compared. These are collected from 2016-2020's annual report of aamara
network.

Profitability Ratios
Most profitability ratios suggest that the firm is doing well if the value is higher than a
competitor's ratio or the same ratio from a prior quarter. When compared to similar firms, the
company's own history, or industry average ratios, profitability ratios are most relevant.

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 Profi t Margin
25.00%
22.00%

20.00% 19.00%
18.00%

15.00%
15.00%

10.00%
7.00%

5.00%

0.00%
2016 2017 2018 2019 2020
Profit Margin Ratio

Profit margin ratio generally measures company’s ability to generate profits from its total sales.
From the above graph we see that from 2016 to 2018 Ammra networks profit margin rises from
7% to 22% but then it decreases in 2019 to 2020. After the pandemic situation they will be able
to generate more profit from their sales.

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 ROE
12.00% 11.00%
10.00%
10.00% 9.00%

8.00%

6.00% 5.00%
4.00%
4.00%

2.00%

0.00%
2016 2017 2018 2019 2020
Return on Equity

Return on Equity measures companies’ ability to generate return from its shareholder equity.
From 2016 to 2018 Ammra network’s ROE risesfrom 4% to 11%. But in 2020 its ROE reduces
to 5% due to pandemic it didn’t sell much of their share in the market & they have losses some
of its shareholder investment.

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 ROA
60.00%

49.00%
50.00%

40.00%

30.00% 25.00% 26.00%

20.00%
20.00%
12.00%
10.00%

0.00%
2016 2017 2018 2019 20 2 0

Return on Asset

Return on Asset ratio represents a company’s ability that how it efficiently manages its asset to
generate return. From the above graph 2016-2018, Ammra networks ROA decreases from 49%
to 12%. In this 3 years they have reduce their ability to efficiently manage their assets. In 2019
again their ROA rises but in 2020 due to pandemic again their ROA reduce to 20%.

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Asset Utilization Ratios
Asset utilization is essential to a firm because its capacity to manage and use its assets is
typically linked to its performance. The firm is more efficient with each dollar of assets kept if
the asset utilization ratio is optimum. An increase in asset utilization indicates that the firm is
getting more value out of each dollar of its assets. This metric is commonly used to compare the
efficiency of a firm over time.

Receivable Tornover
7

6.25
6

4 3.5
3.24
3 2.63
1.92
2

0
2016 2017 2018 2019 2020

Receivable Turnover

The receivables turnover ratio is an accounting metric that quantifies a company's ability to
recover accounts receivable, or money owed by customers or clients. This ratio assesses how
successfully a firm uses and manages the credit it offers to consumers, as well as how fast that
short-term debt is recovered or paid. From 2016 to 2017 Ammra networks receivables turnover
rises from 1.92 to 6.25 times due to efficiency in collecting its receivables. But after 2017 their
efficiency reduced to 3.24 times and in pandemic situation their efficiency reduced more to 2.64
times.

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 Average Collecti on Period
450
400
400

350

300

250

200
136.97
150 112.68
100
57.62
50
0.1
0
2016 20 1 7 2018 2019 20 2 0

Average Collection Period

In terms of accounts receivable, the average collection period is the length of time it takes for a
company to recover payments due by its customers. The average collection period is used by
companies to ensure that they have enough cash on hand to satisfy their financial obligations. In
2017 Ammra networks Average collection period reduced to 57.62 times from 400 times, which
means they have gained more efficiency in collecting their receivables. In 2018 collection period
rises to 112.8 times due to less efficiency in collecting receivables. Due to Covid-19 situation
from 2019-2020 they have again reduced their efficiency in collecting their receivables from
clients as we can see in the graph.

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 Inventory Turnover
4

3.5 3.46 3.32

3 2.76

2.5

2
1.51
1.51
1.5

0.5

0
2016 2017 2018 2019 2020
Inventory Turnover

Inventory turnover calculations assist companies in making better pricing, production,

marketing, and purchasing choices. Inventory levels that are well-managed indicate that a
company's sales are at the appropriate level and that costs are under control. The inventory
turnover ratio is a measurement of a company's ability to generate revenues from its inventory. In
2016 & 2017 Ammra networks Inventory turnover were same. But in 2018 it rises to 3.46 times,
which indicates a high demand of their products & they have gained more revenues by selling
their products. But due to covid -19 situation their inventory turnover reduced to 2.76 times,
because the haven’t sold much of their products..

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 Fixed Asset Turnover
4.5

3.82
4

3.5

2.5

1.5
1.04 1.09
0.96 0.86
1

0.5

0
2016 2017 2018 2019 2020
Fixed Asset Turnover

The fixed asset turnover ratio is a statistic that assesses how efficiently a firm produces sales by
utilizing its fixed assets. If a firm has a greater fixed asset turnover ratio than its rivals, it means
the company is making better use of its fixed assets to produce revenue. As we can see from the
above graph after the year 2016 Ammra network’s fixed asset turnover was not so much good as
it reduced from 3.82 times to 1.04 times in 2017. From 2017 to 2020 their fixed asset turnover
ratio was more or less same, which indicates they have losses their efficiency in utilizing their
fixed asset to generate revenue.

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 Total Asset Turnover
0.7
0.6
0.58
0.6 0.55
0.5
0.5

0.4

0.3 0.27

0.2

0.1

0
2016 2017 2018 2019 2020
Total Asset Turnover

The asset turnover ratio compares the value of a company's assets to the value of its sales or
revenues. The asset turnover ratio is a metric that measures how well a firm uses its assets to
produce income. A company's ability to generate income from its assets is measured by its asset
turnover ratio. The greater the asset turnover ratio, the more efficient it is. From 2016 to 2019
Ammra network’s total asset turnover was much good than year 2020, which indicates in these 4
year they have performed well in utilizing their assets to generate revenue. But in 2020 they have
reduced their efficiency in utilizing their assets.

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Liquidity Ratio

Liquidity ratios are a type of financial statistic that is used to assess a debtor's capacity to repay
current debt commitments without having to raise additional funds. Liquidity ratios assess a
firm's capacity to meet its financial commitments as well as its margin of safety. Liquidity ratios
assess a company's capacity to meet short-term commitments and cash flows, whereas solvency
ratios assess a company's ability to pay off long-term debts.

Current Rati o
7
6.32
6 5.61

1.73 1.91
2

1
0.27
0
2016 2017 2018 2019 2020

Current Ratio

The current ratio is a liquidity ratio that assesses a company's capacity to pay short-term or one-
year commitments. It explains to investors and analysts how a business may use current assets on
its balance sheet to pay down current debt and other obligations. From 2016 to 2017 Ammra
network’s Current ratio was more or less same. In 2018 their current ratio increases to 5.61 times
which indicates they were more capable in paying their short term debt in terms of their assets.
But from 2019 to 2020 their current ratio reduced from 6.32 to 0.27 times which means they
were less capable in paying their debt.

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 Quick Rati o
4.5
3.91 4.2
4

3.5

2.5
2.05
2

1.5 1.16
0.94
1

0.5

0
2016 2017 2018 2019 2020
Quick Ratio

The quick ratio is a measure of a company's capacity to fulfill short-term commitments using its
most liquid assets and is an indicative of its short-term liquidity situation. Like the current ratio
from 2016 to 2017 Ammra network’s quick ratio was more or less same. In 2018 their quick
ratio raised to 3.92 times, due to better capability in meeting their short-term obligations in terms
of their liquid assets. But in 2020 their quick ratio reduced to 2.05 times from 4.2 times, because
due to pandemic situation they have reduced their efficiency in meeting their short term
obligations.

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Debt Utilization Ratio

The debt usage ratio, also known as the balance-to-limit ratio, analyzes how much credit is
utilized with how much credit is available.

Debt To Total Asset

40.00%
36.20% 36.20%
35.00%

30.00%

25.00%

20.00%

15.00% 13.40%
9.40% 8.80%
10.00%

5.00%

0.00%
2016 2017 2018 2019 2020

Debt to Total Asset

Total-debt-to-total-assets is a leverage ratio that measures a company's total debt in relation to its
total assets. Analysts can compare a company's leverage to that of other firms in the same
industry using this statistic. This information might reveal a company's financial stability. The
greater the ratio, the greater the degree of leverage (DoL) and, as a result, the greater the risk of
investing in that firm. In 2016 & 2017 Ammra network’s debt to total asset ratio were same. In
2018 their debt to asset ratio reduced to 9.40% because they have less financed their assets from
their debt rather than equity, which indicates Ammra was safe from investment point of view.
But from 2019 to 2020 their debt to asset ratio rises to 13.40% due to covid-19 situation they
have collect more assets by borrowings from banks rather than their investors. But we think in
future they will perform well.

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 Times Interest Earned
35

30
28.77
25

20 17.18

15 12.49
11.49
9.2
10

0
2016 2017 2018 2019 2020

Times Interest Earned

The TIE ratio is a measure of a company's capacity to fulfill debt commitments based on current
income. Earnings before interest and taxes (EBIT) divided by total interest payable on bonds and
other debt is the method for calculating a company's TIE number. The outcome is a figure that
indicates how many times a company's pretax earnings might pay its interest expenses. In 2019
Ammra network’s times interest earned raised from 9.2 times to 28.77 times, which indicates a
better performance in paying their long term debt based on their current income. In 2020 their
times interest earned again reduced to 12.49 times which means in pandemic situation they were
less capable in paying their debt based on their income.

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 Fixed Charge Coverage
40
33.57
35
28.77
30

25

20 17.18
15 11.49 12.49

10

0
2016 2017 2018 2019 2020

Fixed Charge Coverage Ratio

The fixed-charge coverage ratio (FCCR) assesses a company's capacity to cover fixed costs such
as debt payments, interest, and lease payments. It demonstrates how well a company's earnings
are able to pay its fixed costs. When deciding whether or not to lend money to a company, banks
frequently look at this ratio. In 2016 Ammra networks have higher fixed charge coverage in
terms of their earnings which is 33.57 times. In 2017 it reduced to 11.49 times & again in 2018 it
rises to 28.77 times, which indicates they have more earnings to cover their fixed charges. But in
2020 due to pandemic like all their competitors, Ammra networks lost some of its earnings to
cover their fixed charges.

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 Conclusion

aamara's business principles articulates their values and beliefs. This act as a touchstone of effort
to maintain their higher standards. So for that even after affected by such covid 19 situation, their
connectivity and services was not interrupted, even for a second. aamra’s robust nation-wide
infrastructure and their people kept serving event in the face of turmoil. This is only possible
because of their principles that are practice ed in all their SBU's and all branches. From
technician to CEO all are performed these principles religiously.

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