A STUDY ON FINANCIAL ANALYSIS OF

2D INTERNATIONAL PRIVATE LTD

Submitted by

S. SANTHOSH

18BCF095

Under the guidance of

Mr. J. JANAKIRAMAN., M.COM (FCA), M.PHIL,PGDCA., UGC NET.,(PH.D).

ASSISTANT PROFESSOR IN COMMERCE PA & AF

Submitted in partial fulfilment of the requirements for the award of the degree of

BACHELOR OF COMMERCE - ACCOUNTING & FINANCE

Bharathiar University

Coimbatore-46

HINDUSTHAN COLLEGE OF ARTS AND SCIENCE (AUTONOMOUS)

(Approved by AICTE New Delhi and Affiliated to Bharathiar University)

(ISO 9001:2008 Certified Institution)

Behind Nava India, Coimbatore-641028.

MARCH -2021

1
 CERTIFICATE
2
 CERTIFICATE

This to certify that the project report, entitled

A STUDY ON FINANCIAL ANALYSIS OF 2D INTERNATIONAL PRIVATE

LIMITED

Submitted in partial fulfilment of the requirements for the award of the Degree of

BACHELOR OF COMMERCE -PROFESSIONAL ACCOUNTING

is a Bonafide record work done by

S. SANTHOSH

18BCF095

during the period of her study (2020 - 2021)

DEPARTMENT OF COMMERCE - PROFESSIONAL ACCOUNTING

DEPARTMENT OF COMMERCE - ACCOUNTING & FINANCE

HINDUSTHAN COLLEGE OF ARTS AND SCIENCE (AUTONOMOUS )

COIMBATORE-28

________________ ____ ___________

Mr. J. JANAKIRAMAN DR.M.NIRMALA

GUIDE HEAD OF THE DEPARTMENT

Submitted for the viva-voce examination held on . . . . . . . . . . . . . . . .

______________ ______________

INTERNAL EXAMINER EXTERNAL EXAMINER

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 ACKNOWLEDGEMENT
4
 ACKNOWLEDGEMENT

I like to express my sincere gratitude and thanks to our PRINCIPALDr. A.

PONNUSAMY, MSW., MBA., DLL., M.Phil., Ph.D., and the management for giving me an

opportunity to do this project, during my course of study.

I am extremely thankful to Dr.M.NIRMALAM.Com, M.Phil.,Ph.D., SET,HEAD OF

THE DEPARTMENT OF COMMERCE WITH PROFESSIONAL ACCOUNTING AND

ACCOUNTING & FINANCE.

I also express my gratitude to Mr. J. JANAKIRAMANM.COM (FCA), M.PHIL,

PGDCA., UGC NET.,(PH.D).Assistant Professor, for valuable support given for the project.

I would like to express my gratitude towards my parents for their kind cooperation and

encouragement which helped me in the completion of this project.

I would like to express my special gratitude and thanks to industry persons for giving me

such attention and time. I also express my profound gratitude to the respondents for their

generous help provided for this work.

I also take an opportunity to thank all teaching and non-teaching staff for their valuable

distance provided in this project work.

5
 DECLARATION

6
 DECLARATION

I S. SANTHOSH, hereby declare that the project report, entitled “A STUDY ON FINANCIAL

ANALYSIS OF 2D INTERNATIONAL PRIVATE LIMITED ", submitted to the Bharthiyar

University, Coimbatore in partial fulfilment of the requirements for the awards of the degree of

BACHELOR OF COMMERCE - ACCOUNTING & FINANCE is a record of original and

independent research work done by me during March 2020 under the supervision and guidance

of, Mr. J. JANAKIRAMAN, M.COM (FCA)., M.PHIL.,PGDCA., UGC

NET.,(PH.D).Assistant Professor, DEPARTMENT OF COMMERCE - PROFESSIONAL

ACCOUNTING & ACCOUNTING FINANCE and it has not formed the basis for the award

of any Degree/Diploma/Associate ship/Fellowship or other similar title to any candidate of any

university.

DATE: SIGNATURE OF THE CANDIDATE

S.SANTHOSH
PLACE: REG NO: 18BCF095

7
 CONTENTS

CHAPTER CONTENTS PAGE NO.

LIST OF TABLES

LIST OF CHARTS

I INTRODUCTION

1.1 INTRODUCTION 13

1.2 NATURE OF FINANCIAL ANALYSIS 13

1.3 MEANING AND DEFINITION 13

1.4 TOOLS OF FINANCIAL ANALYSIS 14

1.5 OBJECTIVES OF STUDY 15

1.6 SCOPE OF STUDY 15

1.7 RESEARCH AND METHODOLOGY 15

1.8 LIMITATION OF STUDY 15

1.9 CHAPTER SCHEME 16

II REVIEW OF LITERATURE 18-20

III PROFILE OF THE COMPANY

3.1 INTRODUCTION OF THE COMPANY 22

8
 3.2 OVERVIEW OF THE COMPANY 22

3.3 MISSION 23

3.4 INFRASTRUCTURE 23

3.5 SERVICES 24

3.6 DEPARTMENTS OF 24
2DINTERNATIONAL PRIVATE
COMPANY

3.7 HUMAN RESOURCE DEPARTMENT 25

3.8 COMPANY FILE 31

IV DATA ANALYSIS AND

INTERPRETATION

4.1 RATIO ANALYSIS 34

4.2 PROFITABILITY RATIO 34

4.3 SOLVENCY RATIO 39

4.4 PROPRIETORY RATIO 45

4.5 TREND ANALYSIS 47

4.6 COMPARITIVE BALANCE SHEET 49

V FINDINGS, SUGGESTIONS AND

CONCLUSIONS

5.1 FINDINGS 52

5.2 SUGGESTIONS 54

5.3 CONCLUSIONS 55

9
 LIST OF TABLES

TABLE NO PARTICULARS PAGE NO

4.2.1 GROSS PROFIT RATIO 35

4.2.2 NET PROFIT RATIO 37

4.3.1 LIQUID RATIO 39

4.3.2 CURRENT RATIO 41

4.3.3 ABSOLUTE LIQUID RATIO 43

4.4.1 PROPRIETORY RATIO 45

4.5.1 TREND ANALYSIS 47

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 LIST OF CHARTS

CHART NO PARTICULARS PAGE NO

4.2.1 GROSS PROFIT RATIO 36

4.2.2 NET PROFIT RATIO 38

4.3.1 LIQUID RATIO 40

4.3.2 CURRENT RATIO 42

4.3.3 ABSOLUTE LIQUID RATIO 44

4.4.1 PROPRIETORY RATIO 46

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 CHAPTER-I
INTRODUCTION
12
 CHAPTER – I

INTRODUCTION OF FINANCIAL ANALYSIS

1.1. INTRODUCTION
Financial analysis is the process of identifying the financial strength and weakness of the firm by
properly establishing relationship between items of financial statements. A financial statement is
an organized collection of the data according to logical and conceptual framework. Consistent
accounting accountingprocedure. Its purpose is to convey an understanding of some financial
aspects of the company. It is used to measure firms overall financial health over a given period
of time.

1.2. NATURE OF FINANCIAL ANALYSIS:

The financial statements are prepared on the basis of recorded facts. The recorded facts are these
that can be expressed in monitory terms. The accounting records and financial statements are
form those records are based historical costs. The financial statements are prepared periodically
for the accounting period.

1. Financial statements as composed of data, which are the results.

2. Recorded facts concerning business transaction.
3. Convention adopted to facilitate the accounting technique.
4. Postulates or assumptions made to personal judgement.
5. Application of correction and postulates.

1.3. MEANING AND DEFINITION:

Financial statements are a reasonable knowledge of business and economic activities and
accounting and who are willing to study the information diligently.

According to John Myer, “financial statement analysis is largely a study of relationship among
various financial factors in the business disclosed by a single set of statements and study of the
trend of these factors as shown in a series of statements.

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1.4. TOOLS OF FINANCIAL ANALYSIS:
Afinancial analyst can adopt the following tools for analysis of the financial statements. There
are also termed as methods or techniques of financial analysis.

• Ratio analysis
• Comparative statements analysis
• Common size statement analysis
• Trend analysis
• RATIO ANALYSIS:
Ratio analysis in the simplest terms comparison to two data, numerical values and
quantity values. Ratio analysis allows an evaluation of the balance sheet. Ratio can express
relationship as a percentage, a numerical value, a quantity values. Ratios are fractions where
the numerator is expressed as a portion of the denominator.

It is possible to look at the financial health of a company by looking at some of its key
financial ratio. Ratio analysis can also be used as a diagnostic tool to find the source of
financial trouble at the company. Ratio analysis involves three steps:

1. Calculation of appropriate ratio from the financial statements

2. Comparison of the ratio with standards or ratio of past period
3. Interpretation of ratio.

The financial ratio can be broadly categorised into four categories. They are as follows:

• Profitability ratio
• Liquidity ratio
• Solvency ratio
• Turnover ratio

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1.5. OBJECTIVES OF THE STUDY
• To analyse the profitability of the company.
• To compare the growth level of the company with the help of two years
balance sheet.
• To analyse the financial performance of the company with the help of
ratio analysis.
• To know the stock level of the company by using trend analysis.

1.6.. SCOPE OF THE STUDY

• This study evaluates the financial structure of the GEDEE WEILER
PRIVATE LIMITED COMPANY.
• This study helps to know the detailed profile of the GEDEE WEILER
PRIVATE LIMITED COMPANY.
• This study tries to make an attempt to understand the progress and
problems of the GEDEE WEILER PRIVATE LIMITED COMPANY.
• This study helps to analyse and understand the progress of the finance
department.

1.7. RESEARCH AND METHODOLOGY

This study focuses on profitability and solvency position of the company. It covers the two
financial performance of 2D International private limited company. For the success of present
study data was collected mainly from the secondary data. Under this study it has applied to
compare the comparative balance sheet to know the difference between two years. This study is
applied ratio analysis to know the efficiency of the company. This study also applied trend
analysis to find the profit from the sales and stock of the company.

1.8. LIMITATION OF THE STUDY

• This study is framed within the limited period of time.
• This study cannot be compared to other company.
• Based on the various ratios the conclusions may differ from opinions.

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1.9. CHAPTER SCHEME
• Chapter I : Introduction of the financial analysis
• Chapter II :Review of literature
• Chapter III: Profile of the company
• Chapter IV: Data analysis and interpretation
• Chapter V: Findings, suggestions and conclusions.

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 CHAPTER-II
REVIEW OF LITERATURE

17
 CHAPTER-II

2.1 REVIEW OF LITERATURE

Review of literature refers to the collection of the results of the various researches relating to the
present study. It takes into consideration the research of the previous researches 1which are
related to the present research in anyway. Here are the reviews of the previous researches related
with the present study

BOLLEN (1999) conducted a study on the financial performance on which he found that using
ratio analysis the financial performance of a sample of independent single-plant engineering
firms in leads is examined with regard to structural locational differences in establishment. A
number of determinants of performance are derived and tested against the constructed database
inner-city engineering firms. The study illustrates the importance of using different measures of
performance since thus affects the magnitude and significance of the results. Financial support is
necessary to sustain engineering in the inner city in the long run.

SCHMIDGALL (2000) conducted a study on financial analysis using the statement of

Balance Sheet on which he observed that manages use many financial ratios to judge the health
of their business with a recent requirement of a statement of Balance Sheet by the financial
Accounting Standards Board, manages now have a new set of ratios that will give the realistic
picture of the business. The ratios are particularly useful because they show changes in industry
cash position overtime, rather than at a given moment, as is the case with many other ratios.

MCMAHON (2002) conducted a study on financial information on which he found that

financial statements mean little to the uninitiated .this paper, explains in layman‟s terms, how to
understand financial information .It covers measures of profitability. The second article will
cover measures of company liquidity and the use of financial ratios. This paper continuous to
explain how to interpret and understand financial information. It deals with the measure of
liquidity, Solvency & fund flows and describes how to establish standards against with the
company’s financial ratios can be compared.

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KRISHNA PRASAD UPADHYAY (2004) used different type of financial ratios to check
the financial performance of the selected finance companies that basically in this study he used
solvency ratio, liquidity ratio, Efficiency ratio, Profitability ratio. Different measures like return on
investment, Return on equity, Return on asset, Earning per share, Dividend per share and Asset
utilization ratio are used to assess the profitability of the companies. He concluded the study stating
that solvency position of both companies is not sound and credit creation capacity is good in both
companies inaggregate.

MISS R. SUBHASHINI (2005) in the project concluded that the short term solvency and
profitability position was good .long term solvency position was satisfactory and the management
of current assets as efficient

MARIA ABRAHAM (2006) in the study concluded that the overall financial position of the
company was good, and the company has undertaken to implement effective measures for their
growth and make improvements to earn a better status in thefuture

VERDI ALI (2007) identifies whether the company has a strong financial fundamental and
whether investment in the company will be long term nature its financial statement had been
analysed during five years period. Financial analysis has been measured by various ratios the study
concludes that current ratio has declined in the last four years however, it is still well above the
industry level, and it maintenance a good level of liquidity.

MISS M. SUGANTHA (2008) in the study concluded that the overall financial position of
the company is good, and the profitability position is also good .the sales profit and the stock also
had an increase in trend which indicates the overall financial performance of the concern is good.

HASSAN MOVEEN, ALAM, ALI RAZA and MUHAMMAD AKRAM (2011) examine

financial performance of leasing companies since 2008 to 2010. Ratio analysis technique has been
used to evaluate financial performance of leasing companies. Nine companies are selected for
analysis out of fifteen and the study covers three year period. The researcher used ratio as statistical
tools. The study concludes that in 2010 financial ratios are showing the positive change but declaring
financial performance of a leasing company in 2009 when compare to 2008.

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SHRABANTI PAL (2012) also carried out a study on financial performance of Indian steel
for the period from 1991 – 1992 to 2010 – 2011 to examine the financial performance of the Indian
steel companies and establish the linear relationship between liquidity, leverage, efficiency and
profitability of the selected companies. Multiple Regression Analysis is conducted on fifteen
financial ratios selected from different segment like liquidity ratio, Solvency ratio, Activity ratio,
Profitability ratio. He concluded his research that the company should concentrate to improve the
overall liquidity, solvency and efficiency to enhance the profitability to the maximum otherwise the
profitability of the companies will be affected in other way.

SHAJI.U AND G.GANESAN (2013) made an attempt to study the overall financial
performance of selected public sector drug and pharmaceutical enterprises in India with the help of
some statistical tools .the study revealed that the industry will witness an increase in the market
share .the sector is poised not only to take new challenge but to sustain the growth momentum of
the post decade.

BHASKER BAGCHI, BASANTA KHAMRUE (2014) aimed at analysing the financial

performance of leading 2w automobile industries in India, over a period of 19 years (1991- 1992 to
2009-2010). For this purpose, various accounting ratios and statistical tools have been used .the
study results reveal the strong profitability and liquidity position of the industry. He recommends
that the sector is all set to take the new challenges and also to sustain the growth momentum of the
lastdecade.

VENKATARAMMA N.K. RAMAKRISHNAIAH (2015) made an attempt to know the

profitability and financial position of the selected cement companies, the data collected from the
annual report from 2001 -2014 from the selected then cement companies in India .the collected data
is analysed and computed to fit for drawing inference. The results reveals that profitability of the
selected companies has a favourable trend towards in terms of return on equity ratio and return on
capital employ.

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 CHAPTER-III
COMPANY PROFILE

21
 CHAPTER-III
PROFILE OF THE COMPANY
3.1. INTRODUCTION OF THE COMPANY
Indian engineering industry has witnessed growth in the past few years as a result of increased
investment in infrastructure development and industrial production. Today, India has diversified
industry/capital base components of catering to complex requirements and demands for an entire
range of industry machinery. The engineering industry plays a significant role in the development
of other industrial sectors in the economy.

This sector is very closely linked with the manufacturing and infrastructure sectors of the economy.
The quality and cost of engineering products depends on the quality of the parent machine tools and
their automation levels. The developments of machine industry is therefore of great importance for
a competitive and self-reliant industrial structure.

The engineering sector is the largest sector among the industrial segments in India and provides
direct employment to over 4 million skilled and non skilled workers. This industry basically
comprises of heavy and light engineering. This is further sub categorised into machinery/capital
goods, equipments, and transport equipment in heavy engineering, casting and forgings to
sophisticated process control equipment in the light engineering segment. Machine tools form part
of the capital goods segment.

Organizational functioning is an important factors any organisation to achieve the desired goals and
objectives. This enquires coordination at all the levels to smooth functioning.

Industry is simply defined as any activity by which they either create materials, alter materials to
create something else, or move materials around. Also, anything involving the usage of blue prints.
Key activity of the industry activity is mining, refining, planetary interactions, hauling, and RD
activities.

The CNC industries were applied on lathes, mining machines etc, which could perform a single type
of metal cutting operations. Later attempt was made to handle a variety of work pieces that may
requireseveral different types of machining operations and to finish them in single set-up.

3.2. OVERVIEW OF THE COMPANY:

2D INTERNATIONAL PRIVATE LIMITED was established in 1966 to manufacture sophisticated
high precision lathes. The company is registered with DGTD as a medium scale machine tool
manufacturer and was promoted by Mr.Gopal. About 39% equity is held by a Mr. Hermann Weiler
and the company is having a technical and financial collaboration M/s.G.D.W.Werkzeugmaschinen.
22
Presently the company manufactures wide variety of precision lathe including CNC lathe. The
company’s products are marketed under the brand name of “2D INTERNATIONAL” which enjoys
immense popularity and brand equity in the country.

2D INTERNATIONAL is committed to providing cost effective, viable solutions to a wide range

of industries, especially in the manufacture of components. Components that is often critical to
industries like textile, automobile, medical, domestic appliances and aerospace among others. With
a strong presence in India, the company also exports to places as diverse as Europe, south East Asia,
and the Far East. 2D INTERNATIONAL as manufacturer of machine tool since 1966, 2D
INTERNATIONALr has close to 50 years of experience in this manufacturer sector. 2D
INTERNATIONAL strives to delivery CNC lathes, CNC Turing centres to our customers with best
quality, precision and reliability. The 2D INTERNATIONAL range of lathes and turning centres is
one of the most comprehensive in the market and comprises:

2D INTERNATIONAL horizontal single turret CNC lathes / turning centres.

2D INTERNATIONAL twin spindle CNC lathe/ turning centres.

2D INTERNATIONALtwin turret/single spindle CNC machines.

2D INTERNATIONAL twin turret/twin spindle CNC machines.

2D INTERNATIONAL vertical type CNC lathes.

2D INTERNATIONAL sliding head CNC lathes.

3.3. MISSION:

Committed to bringing world’s best technology within the easy reach of the customer facilitated by
a clear perception of customer demands and the needs of the market and offer optimum cost effective
manufacturing solutions with support from global partners.

3.4. INFRASTRUCTURE:

The company has state of the art mother machines to produce parts for building machines. For
instance, parts like spindle housing, slides, boxes are machined on “Hermle” five axis machine,
main spindles are machined on “ROMI” mill turn centre and grinding done on studer/reishaur
grinding machines, machine beds are ground on “Schneider” Plano grinding machines.

23
3.5. SERVICES:

As a company that stays fully focused on providing complete customers support, the company
leaves no stone unturned to ensure that the customer gets benefits of their considerable experience
and expertise. A standing testimony to this is the fact that over 85% of orders from existing
customers.

3.6. DEPARTMENTS OF 2DINTERNATIONAL PRIVATE LIMITED:

The 2D INTERNATIONAL private limited as lot of departments in which each department as

uniqueness in them and the department are consists of many members also.

These are some of the departments that are in this organisation.

➢ Human resource department

➢ Sales department
➢ Service department
➢ Planning department
➢ Store department
➢ Quality control department
➢ Painting department
➢ Assembly department
➢ Production department
➢ Housekeeping department
➢ Design department
➢ Computer department
➢ Costing department
➢ Electronics department
➢ Purchase department
➢ Finance department
➢ Motor section department
➢ Marketing department
➢ Power house department

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3.7.1. HUMAN RESOURCE DEPARTMENT:

Human resource is the company department charged with finding, screening, recruiting and training
job applicants, as well as administrating employee-benefits programs. Human resource departments
in larger organisation have employees who are organised around providing a specific component of
human resource services including compensation, training, organisation development and safety.
They have titles such as training manager, organisation development consultant, and safety
coordinator.

A human resource department is a critical component of employee well-being in any business,

no matter how small. Human resources responsibilities include payroll, benefits, hiring, firing and
keeping up to date with state and federal tax laws.

• Recruitment:

Jobs alert and job notification, in the official 2D INTERNATIONALwebsite. They also update
official notification in naukri.com.

The company has well equipped training centre where employees are given periodical training in
safety, product-quality, and work life, newer concepts in manufacturing and measuring,
housekeeping where necessary. The employees are sent for outside training program also.

• Workers profile:

Total number workers = 290

• Timing :

FOR WORKERS:

7.00am to 4.00pm

8.15am to 5.00pm

1.00pm to 9.00pm

5.00pm to 1.30pm

7.00pm to 3.30am

1.00am to 8.00am

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 FOR MANAGEMENT STAFFS:

8.30AM TO 5.00PM

• Wages and salaries

• Earnings of workers
• Basic pay
• HRA
• Conveyance
• PF
• ESI
• Bonus
• Incentives

They above earnings are the total wages of the workers ESI,PF and etc are deducted
from their earnings. The salaries are paid on 7th day of every month.

Employees contributions Employer contribution Total

ESI 1.75% 4.75% 6.5%
PF 12% 3.67% 15.67%

Benefits under ESI:

• Sickness benefits
• Medical benefits
• Funeral benefits
• Maternity benefits
• Disablement benefits

Leave incentives:

• Casual leave
• Privilege leave

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 Attendance incentives:

Without taking any leave –RS.250 will be provided

3.7.2FINANCE DEPARTMENT:

A finance department manages a firm’s long term and day-to-day monetary operations and strategy.
Finance groups oversee incoming and outgoing payments, budgetcreation, cash management
(treasury), accounting, financial reporting and many other tasks related to the finance of the
company.

Their duties include financial planning, reporting and control, short and long term business
strategy, investment, mergers and acquisitions, cash management, internal risk management,
corporate finance, auditing and accounting.

• DAILY PROCESS:
• Purchase bill entry
• Sales invoice entry
• Cash receipt and payment
• Bank receipt and payment
• Debit note and credit note

• Purchase bill entry:

To run a successful venture a business needs to purchase raw material and manage its stock
optimally throughout its operational cycle. Accounting and journal entry for purchase includes
two entries:

Creditor and purchase

Cash and purchase

• Sales invoice entry:

A sales journal entry records the revenue generated by the sale of goods and services.
• Cash receipt and payment:

An amount of money received by a company for goods and services, which is added to cash
receipts which the balance brought down to give us the total amount of cash. The written documents
that is produced by a company each time its receives money for goods and services.

27
 A cash payments journal is used to record transactions that are paid in the form of cash. A cash
payment can include paying a creditor or commission fee, making interest payment in cash. If any
payment is made using the cash, it is recorded in the cash payments journal.

• Bank receipts and payment:

Bank receipts:
A proof or acknowledgement of the deposit that is received by a bank from the investors. This
gives various details like amount, time period, mode of payment.
Bank payments:
It carry out most bank operations, were the payment made to the supplier.

• Debit note and credit note:

CREDIT NOTE:
A credit note or credit memorandum is a commercial document issued by a seller to a buyer.
Credit notes acts as a source document for the sales return journal. In other words, the credit
note is evidence of reduction in sales.
DEBIT NOTE:
A debit note or debit memorandum is a commercial document issued by a buyer and the seller
as means of formally requesting a credit note. Debit note acts as the source document to the
purchase returns journal.
EXAMPLE: Bill variance, Quantity mismatch.

RESPONSIBILITY OF FINANCE DEPARTMENT:

The contribution of finance department is positively affect the organisation performance .the
responsibility of company will be limited to

• Bookkeeping
• Management of company cash flow
• Budgets and forecasting
• Management of taxes
• Financial reporting and analysis
• Management of the company investment

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3.7.3. PRODUCTION DEPARTMENT:

Production planning is the planning of production and manufacturing modules in a company or

industry. It utilizes the resources allocation of activities of employees, materials and production
capacity, in order to serve different customers

Production planning is a plan for the future production, in which the facilities needed are
determined and arranged. A production plan is made periodically for a specific time period called
the planning horizon. It can comprise the following activities:

• Determination of the required product mix and factory load to satisfy the customer’s
needs
• Matching the required level of production to the existing resources.
• Scheduling and choosing the actual work to be started in the manufacturing facilities.
• Setting up and delivering production orders to production facilities.

3.7.4. PURCHASE DEPARTMENT:

All the department plan their purchase requirement ahead and send the list to the purchase
department. The purchase department sends the requirement list to the suppliers and asks for the
availability and price of the products.

The supplier sends their quotation.

Economically feasible quotation is selected and approved.

Po is sent to the supplier

29
30
3.8. COMPANY PROFILE:

Name and address

of the company - 2D INTERNATIONAL PRIVATE LTD

Mangalam road,

Tirupur-641687, Tamil nadu.

Registered office - D.no: 317 Aandipalayam,

Tirupur-641687.

Registration number - 564

Telephone - 2413908/2413513

Fax - 2413528

E-mail - [email protected]

gdweiler.in

Establishment of business- 30 august 1966

Age of the company - 51 years

Corporate identity no - U29191TZ1966PTC000564

Category - Company limited by shares

Sub- category -Non Government Company

Listing status - Unlisted

Bank - KOTAK MAHINDRA BANK,

Business type - Manufacturer, Supplier, Exporter

Products manufactured - CNC Lathe, Conventional Lathe

Authorised capital - RS.3, 00, 00,000

Paid up capital - RS.2, 05, 00, 000

Directors - Hermann fried rich weiler

31
RajkumarGopalswamyDuraiswamy

Shanthinivenkatesamchoudhry

Gopal GopalswamyDuraiswamy

Auditors -K.S.G.Subramanian

No. of employees- 230

Software used - Roadman

32
 CHAPTER-IV

DATA ANALYSIS AND INTERPRETATION

33
 CHAPTER-IV

DATA ANALYSIS AND INTERPRETATION

Data analysis means the process of evaluating data using analytical and logical reasoning to examine
the data. Interpretation means the act of identifying the data and merging the data. Data analysis and
interpretation is the process of assigning meaning to the collected information and determining the
conclusions, significance and implications of the findings. The following are the various tools used
in this analysis

➢ Ratio analysis
➢ Trend analysis
➢ Comparative balance sheet

4.1. RATIO ANALYSIS:

It is a form of financial statement analysis that is used to obtain a quick indication of the firm’s
financial performance in several ways;the ratio may divided into these types:

• Profitability ratio
• Solvency ratio
Short term solvency ratio

4.2 PROFITABILITY RATIO:

It measures the ability of a company to generate profits. Profitability ratio provides information
on the amount of income from eachsale. It is also referred as profit margin ratio.

34
4.2.1. GROSS PROFIT RATIO:

The gross profit is the ratio of gross income or profit of sales. The difference between net sales
and cost of goods sold is known as gross profit. Gross profit ratio as follows:

FORMULA:

Gross profit ratio = Gross profit/ Net sales x100

TABLE NO: 4.2.1

YEAR GROSS PROFIT SALES GROSS PROFIT

RATIO

2015-2016 6263748 58867531 10.64

2016-2017 13859184 69730620 19.87

INTERPRETATION:

From the above table reveals that the gross profit ratio is fluctuating fortwo year period ranging
in 2016 is 10.64 %and 2017 is 19.87%. when compared with the previous year gross profit ratio
has been increased to 19. 87%.

35
 CHART NO: 4.2.1

GROSS PROFIT RATIO OF

2D INTERNATIONAL PRIVATE LTD COMPANY

36
4.2.2 NET PROFIT RATIO:
Net profit is also referred as the bottom line, net income or net earnings is a measure of the
profitability of a venture after accounting for all costs and taxes. It is the actual profit, and includes
the operating expenses that are excluded from gross profit.

FORMULA

Net profit = Net profit / revenue x 100

TABLE NO: 4.2.2

YEAR NET PROFIT REVENUE NET PROFIT
RATIO

2015-2016 6263748 58867531 10.64

2016-2017 13859184 69730620 19.87

INTERPRETATION:
From above table reveals that the net profit ratio is fluctuating for two year period ranging in
2016 is 10.64% and 2017 is 19.87% . when compared with the previous year net profit ratio has
been increased to 19.87%.

37
 CHART NO: 4.2.2

NET PROFIT RATIO OF

2D INTERNATIONAL PRIVATE LTD COMPANY

38
4.3. SOLVENCY RATIO:

The solvency ratio is a key metric used to measure an enterprises ability to meet its debt obligations
and also indicates the company’s cash flow is sufficient to meet its short term and long term
liabilities.

4.3.1. LIQUID RATIO:

Liquid asset ratio is used to measures the ability of a company to use its near cash or quick assets
extinguish or retire its current liabilities immediately .it is also known as quick ratio, acid test ratio.

FORMULA

Liquid ratio = Liquid asset/ current liability

TABLE NO: 4.3.1

YEAR LIQUID ASSET CURRENT LIQUID RATIO

LIABLITY

2015-2016 33217649 14122263 2.35

2016-2017 57219121 7325603 7.81

INTERPRETATION:

From the above table reveals that the liquid ratio is fluctuating for two year period ranging in 2016
is 2.35 and 2017 is 7.81. when compared with the previous year liquid ratio has been increased to
7.81.

39
 CHART NO: 4.3.1

LIQUID RATIO OF
2D INTERNATIONALPRIVATE LTD COMPANY

40
4.3.2CURRENT RATIO:

The current ratio is an indication of a firm’s liquidity. It measures whether or not a firm has enough
resources to meet its short term obligations. It compares a firm’s current asset to its current
liabilities.

FORMULA

Current ratio = current assets/current liability

TABLE NO: 4.3.2

YEAR CURRENT ASSET CURRENT CURRENT RATIO

LIABILITY

2015-2016 55834193 14122263 3.95

2016-2017 79230645 7325603 10.81

INTERPRETATION:

From the above table reveals that the current ratio is fluctuating for two year period ranging in 2016
is 3.95 and 2017 is 10.81. when compared with the previous year current ratio has been increased
to 10. 81.

41
 CHART NO: 4.3.2

CURRENT RATIO OF
2D INTERNATIONAL PRIVATE LTD COMPANY

42
4.3.3ABSOLUTE LIQUID RATIO:

The relationship between the absolute liquid assets and current liabilities is established in this ratio.
Its absolute liquid assets take into account cash in hand, cash at bank, investments.

FORMULA

Absolute liquid ratio = Absolute liquid asset / Liquid liabilities

TABLE NO: 4.3.3

YEAR ABSOLUTE LIQUID ABSOLUTE

LIQUID ASSET LIABLITIES LIQUID ASSET

2015-2016 23634110 14122263 1.67

2016-2017 20786241 7325603 6.93

INTERPRETATION:

From the above table reveals that the absolute liquid ratio is fluctuating for the two year period
ranging in 2016 is 1.67 and 2017 is 6.93. when compared with the previous year absolute liquid
ratio has been increased to 6.93.

43
 CHART NO: 4.3.3

ABSOLUTE LIQUID RATIO OF

2D INTERNATIONAL PRIVATE LTD COMPANY

44
4.4.1. PROPRIETORY RATIO:

The proprietary ratio is the proportion of shareholders equity to total assets, and such provides a
rough estimate of the amount of capitalisation currently used to support a business.

FORMULA

Proprietary ratio = Shareholders fund / Total tangible assets

TABLE NO: 4.4.1

YEAR SHAREHOLDERS TOTAL TANGIBLE PROPRIETORY

FUND ASSET RATIO

2015-2016 186907816 85163248 2.19

2016-2017 173048632 85954905 2.01

INTERPRETATION:

From the above table reveals that the proprietory ratio is fluctuating for two year period ranging in
2016 is 2.19 and 2017 is 2.01. when compared with the previous year proprietory ratio has been
declined to 2.01.

45
 CHART NO: 4.4.1

PROPRIETORY RATIO OF
2D INTERNATIONAL PRIVATE LTD COMPANY

46
4.5.1TREND ANALYSIS:

Trend analysis is a technique analysis that attempt to predict the future stock price movements based
on recently observed data.

Calculation of trend analysis:

Amount of change=current year / base year x100

TABLE NO: 4.5.1

YEAR SALES % STOCK % PROFIT %

2015 61700709 100 29192051 100 3101430 100

2016 58867531 95.40 22616544 0.77 6263748 201.9

2017 69730620 113 22011524 75.4 13859184 446.8

47
INTERPERTATION:

• The trend analysis reveals that sales as increased in 2016-2017 which is 113 by the difference
from 2015-2016 which is 95.40.
• The trend analysis reveals that stock as increased in 201-2017 which is 0.77 by the difference
from 2015-2016 which is 75.4.
• The trend analysis reveals that profit is increased in 2016-2017 which is 201.9 by the
difference from 2015-2016 which is 446.8.

48
 4.6 COMPARATIVE BALANCE SHEET:

PARTICULARS 2016 2017 INCREASE/ %

DECREASE
Assets:
Non-current asset:
Intangible asset 85954905 85163248 -791657 0.9
Non-current assets 26154906 24338197 -1816709 6.9
Long term loans and 24226893 5501330 -18725563 77.2
advances
Current assets:
Inventories 22616544 22011524 -605020 2.6
Trade receivables 6865363 4519222 -2346141 34.1
Cash and cash equivalents 22546977 49705605 +27158628 120.4
Short term advances 1087132 1080636 -6496 0.5
Other current assets 2718176 1913658 -804518 29.5
TOTAL ASSETS 192170896 194233420 2062524 1.1
Liabilities:
Shareholders fund:
Share capital 35000000 35000000 - -
Reserves and surplus 138048632 151907816 +13859184 10.0
Non-current liabilities:
Long-term liabilities 5000000 - -5000000 100
Current liabilities
Short term liabilities 5484116 - -5484116 100
Trade payables 2998897 1975177 -1023720 34.1
Other current liabilities 3464251 3150427 -313824 9.05
Short-term liabilities 2175000 2200000 +25000 1
TOTAL LIABILITIES 192170896 194233420 2062524 1.1

49
INTERPRETATION

This comparative balance sheet reveals that the total assets of 2016 is 192170896 when
compared with the next year 2017 is increased to 194233420.

The is an increase in cash and cash equivalents which is 120.4%.

This comparative balance sheet reveals that the total liabilities of 2016 is 192170896 when
compared with the next year 2017 is increased to 194233420.

This comparative balance sheet reveals that the fixed assets are utilised for company more than
2016 when compared to 2017.

50
 CHAPTER-V

FINDING,SUGGESTION AND CONCLUSION

51
 CHAPTER-V

FINDING, SUGGESTIONS AND CONCLUSION

5.1. FINDINGS

A finding made on the A Study on Financial Analysis of 2DINTERNATIONALPrivate Limited

is as follows:

Ratio Analysis:

➢ The table reveals that the gross profit ratio is fluctuating for two year period ranging in 2016
is 10.64 % and 2017 is 19.87%. when compared with the previous year gross profit ratio has
been increased to 19. 87%.
➢ The table reveals that the net profit ratio is fluctuating for two year period ranging in 2016
is 10.64% and 2017 is 19.87% . when compared with the previous year net profit ratio has
been increased to 19.87%.
➢ Thetable reveals that the liquid ratio is fluctuating for two year period ranging in 2016 is
2.35 and 2017 is 7.81. when compared with the previous year liquid ratio has been increased
to 7.81.
➢ The table reveals that the current ratio is fluctuating for two year period ranging in 2016 is
3.95 and 2017 is 10.81. when compared with the previous year current ratio has been
increased to 10. 81.
➢ The table reveals that the absolute liquid ratio is fluctuating for the two year period ranging
in 2016 is 1.67 and 2017 is 6.93. when compared with the previous year absolute liquid ratio
has been increased to 6.93.
➢ The table reveals that the proprietory ratio is fluctuating for two year period ranging in 2016
is 2.19 and 2017 is 2.01. when compared with the previous year proprietory ratio has been
declined to 2.01.

52
Comparative Balance Sheet:
➢ The Comparative balance Sheet reveals that the total assets of 2016 is 192170896 when
compared with the next year 2017 is increased to 194233420.The comparison shows that
there is an increase in cash and cash equivalents which is 120.4%.
➢ The comparative balance sheet reveals that the total liabilities of 2016 is 192170896 when
compared with the next year 2017 is increased to 194233420.The comparison shows that
there is an decreased in long term liabilities completely in 2016-2017.

Trend analysis:

➢ The trend analysis reveals that sales as increased in 2016-2017 which is 113 by the
difference from 2015-2016 which is 95.40.
➢ The trend analysis reveals that stock as increased in 201-2017 which is 0.77 by the
difference from 2015-2016 which is 75.4.
➢ The trend analysis reveals that profit is increased in 2016-2017 which is 201.9 by the
difference from 2015-2016 which is 446.8.

53
5.2. SUGGESTIONS

➢ This study on profitability of 2D INTERNATIONAL reveals that the profitability

➢ position of the company is satisfactory. So positive attempt should be made to keep
the profitability.
➢ The proprietary ratio represents that relationship of shareholders funds in total assets
which is low in long term solvency position. So this ratio indicates that the extent in
shareholders fund can increase the assets of the company.
➢ The trend analysis shows that increase profit which is represents the sale and stock
is also increased, so maintain the stock level can improve the sale and profit.

54
5.3. CONCLUSION

The main objective was to analyse the financial performance and evaluation of the 2D
INTERNATIONALprivate limited through the comparative balance sheet and ratio analysis.
The analysis was done on the basis of the data collected from the published annual reports.
From the analysis done interpretations and findings are drawn. Thereby it was concluded that
the 2D INTERNATIONAL private limited has to utilized of its resources. The overall financial
performance and the profitability position of the 2D INTERNATIONAL private limited
company is satisfactory. The company has to maintain the stock level to improve the sales and
to attain the profit. The company has to take forward steps for smooth running of company.

55
BIBLIOGRAPHY

REFERENCE IN BOOK
• Annual report of the year 2015 to 2017 of the 2D INTERNATIONALprivate limited
company, Coimbatore.
• Shashi k.Gupta, R.K.SharmaNeeti Gupta, “MANAGEMENT ACCOUNTING”, kalyani
publishers.
• Dr.R.Ramachandran ,Dr.R.Srinivasan “MANAGEMENT ACCOUNTING”,raja
publication.
• S.P.Jain&K.L.Narang “ACCOUNTING FOR MANAGEMENT,kalyani publishers.

REFERENCE IN WEBSITE

• www.google.com
• www.gdweiler.com
• www.investopedia.com
• www.shodhganga.com

56
 APPENDIX

57
BALANCE SHEET OF 2016-2017

PARTICULARS 2016 2017

Assets:
Non-current asset:
Intangible asset 85954905 85163248
Non-current assets 26154906 24338197
Long term loans and 24226893 5501330
advances
Current assets:
Inventories 22616544 22011524
Trade receivables 6865363 4519222
Cash and cash 22546977 49705605
equivalents
Short term advances 1087132 1080636
Other current assets 2718176 1913658
TOTAL ASSETS 192170896 194233420
Liabilities:
Shareholders fund:
Share capital 35000000 35000000
Reserves and surplus 138048632 151907816
Non-current
liabilities:
Long-term liabilities 5000000 -
Current liabilities
Short term liabilities 5484116 -
Trade payables 2998897 1975177
Other current 3464251 3150427
liabilities
Short-term liabilities 2175000 2200000
TOTAL 192170896 194233420
LIABILITIES

58
BALANCE SHEET OF 2015-2016

PARTICULARS 2016 2015

Assets:
Non-current asset:
Intangible asset 85954906 87836664
Non-current assets - 1588792
Long term loans and 26154906 24763651
advances
Current assets:
Inventories 22616544 29192051
Trade receivables 6865363 14003016
Cash and cash 22546977 10374209
equivalents
Short term advances 3805308 3428430
TOTAL ASSETS 192170896 196185641
Liabilities:
Shareholders fund:
Share capital 35000000 35000000
Reserves and surplus 138048632 144312380
Non-current
liabilities:
Long-term liabilities 5000000 5000000
Current liabilities
Short term liabilities 5484116 3142276
Trade payables 2998897 2967883
Other current liabilities 3464250 3335294

Short-term liabilities 2175000 2427808

TOTAL 192170896 196185641
LIABILITIES

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