A PROJECT REPORT ON

Financial Statement
analysis of Reliance
Industries Limited
 CHAPTER – I
INTRODUCTION

The research of financial declaration is ready for the objective of presenting a

comment that is periodical possibly report by the control of and additionally
contend with all the state of investment in company and also result attained during
the time under review. They mirror the fiscal position and also operating strengths
or maybe weaknesses of the situation by effortlessly developing connection
between the things regarding the stability sheet and eliminate statements.
Financial statement analysis is under considered either by the control of the firm
and by the external parties. The characteristics of analysis defers based on the
intent behind the assessment. The analyst can suggest exactly how well the firm
could use the supply on the tradition in producing services and items. Turnover
ratios would be the resources that are top choosing these aspects.
Thus it's general task for the control to learn that the origin of the firm can
effectively be used most and also efficiently which the firm 's economic position is
great. Financial statement analysis does suggest what could be anticipated in later
in the tight.
Meaning of Financial Statement

Financial statements mention such claims which has info that is financial an
enterprise. Profitability is reported by them plus the position that is monetary
of business at the conclusion of accounting timeframe. The group statement
that is financial a minimum of 2 statements that the accountant preps at the
summary of an accounting time. The two claims are: -

• The Balance Sheet

• Profit And Loss Account

They provide some info that is really helpful the amount that balance Sheet is
an expression associated with positioning that is monetary a particular time
when it comes to the framework of assets, debts and owners equity, the like
while the Loss and revenue account shows the end result of organizations
throughout a particular time period in terminology for the revenues obtained
and in addition the purchase price incurred during the season. Hence the
declaration that is economic a summarized view of fiscal operations and place
of a firmMeaning of Financial Statement analysis

The first task of Financial Statement analysis is to select the information

relevant to the decision under consideration to the total information contained
in the financial statement. The second step is to arrange the information in a
way to highlight significant relationship. The final step is interpretation and
drawing of inference and conclusions. Financial statement is the process of
selection, relation and evaluation.
Features of Financial Statement analysis

 • To offer an information that is intricate in the economic statement in

understandable and type that is straightforward.

 • In purchase to classify the items present in the statement that is&amp that is
financial rational groups.

 • To make comparison between different teams to draw conclusions that are various.
Purpose of Analysis of financial statements

 • in order to discover the receiving capability and profitability.

 • to find the solvency away.

 • To understand the skills which can be financial.

 • so that you can learn the capability of re payment of dividends and

interest.

 • In purchase to make comparison research with a great many other

programs.

 • to be able to comprehend the pattern of business.

 • so that you can comprehend the effectiveness of administration.

 In order to provide information that is useful to management.

 the time is normally as opposed with the general sales of its competition that
is main like and Wal Mart. Intercompany comparisons are helpful in
determining a company 's naturally position that is competitive.

Tools of Financial Statement Analysis

Various instruments are used-to assess the value of statement of finance

information. Ratio review is the many likely the kind that is most that is
common of useful for statement of finance assessment.

 Ratio Analysis:

• Fundamental Analysis posseses an range that is extremely wide. One aspect

examines the(qualitative that is common components of an enterprise. The medial
side that is measurable that is additional concrete elements (quantitative). This
means crunching and amounts which can be analyzing the claims which can be
financial. If utilized along side some other methods, quantitative analysis is able to
make good results.
• Ratio assessment isn't just evaluating numbers that vary from the amount that is
total, cash movement statement, and income statement. It is looking at the
selection against prior years, the industry, other programs, and perhaps the system
that is financial the complete. Ratios look at the interactions between specific
values and connect them to the way that is real business has done in previous
times, because well as can do in the future.
 Meaning of Ratio:
A ratio is an figure express in terminology of a figure that is additional. It's a yardstick that is
measures which can be mathematical connection 2 figures, as well as have been connected with
each other and mutually interdependent. Ratio is express by dividing 1 figure by extra figure that
is related. Hence a ratio is really a manifestation relating a quantity that is single just one more. It
is merely the quotient of 2 figures. It are conveyed as part or maybe being a decimal or possibly
as a ratio that is genuine even yet in complete figures as "so often times". As accounting ratio
can be an expression relating 2 figures or possibly records or maybe 2 sets of group or account
heads include into the claims that are financial.
 Meaning of Ratio Analysis:
Ratio assessment could possibly be the strategy or maybe procedure through which the text of
group or elements of things within the statement that is monetary presented, determined, and
computed.
Ratio evaluation is a work to gain measure that is quantitative maybe guides concerning the
financial wellness plus success of business enterprises. Ratio analysis work both in pattern along
with stationary analysis. You can find numerous proportions at the fingertips of a analyst
nevertheless the amount that is combined of of ratio he'd select is based regarding the objective
plus the purpose of analysis.

While a explanation that is comprehensive of examination is beyond the range of the area, we
intend to focus on a method, and that is effortless to use. It's able to give you a investment that
is invaluable tool.This process is well called cross analysis that is sectional. Cross-sectional
analysis compares economic ratios of several organizations from the continuing business that is
identical. Ratio analysis is in a position to offer information that is valuable about a company's
economic health. A ratio that is financial a company 's overall performance in an area that's sure.
As an example, you can make use of a ratio of an organization's financial obligation to the
equity of its to determine a business 's influence. By assessing the leverage ratios of 2
organizations, it is possible to decide which company utilizes increased debt within the conduct
of its business. A business whose leverage ratio is larger when compared with their competition
has much more debt per equity. It is possible to to utilize the given information generate a
judgment regarding that organization is a far greater investment risk.

Nevertheless, you should never be aware to place a sum that is extortionate of on 1 ratio. You
attain a far better indication of the path where a company is transferring every time a ratios that
are few regarded as a team.
 Objectives of Ratios:
Ratios are worked out to analyze the following aspects of business
organization-

A) Solvency-
1) Long term
2) Short term
3) Immediate
B) Stability
C) Profitability
D) Operational efficiency
E) Credit standing
F) Structural analysis
G) Effective utilization of resources
H) Leverage or external financing

1] Liquidity position: -
With the help of Ratio analysis conclusion could be drawn about possibly the
liquidity an element of the tight. The liquidity role of a firm is satisfactory in
situation it's in a position to generally meet with its obligation that is present every
they start to be due. an organization may be stated to seriously have the capacity to
meet its quick term liabilities if it is fluid that is adequate having to pay the
attention on its brief debt that is maturing within year and also to settle the main.
This capability is mirrored in the liquidity ratio associated with tight. The liquidity
ratio is very of good use in credit evaluation by bank & several other vendors
of short-run loans.
1] long-lasting solvency: -
Ratio analysis normally helpful for examining the term that is viability that is long
of tight. This regard of this host that is financial a borrower is of issue in the long-
term creditors, security analyst & the potential and present owners of the
business. The lasting solvency is set through the leverage/ capital building &
profitability ratio Ratio evaluation s which focus on generating energy &
running effectiveness.
The power & weaknesses of a very good in this respect is revealed by ratio
analysis. The leverage ratios, for example, will show whether a powerful has
proportion that is great of resources of financial or merely in case it's greatly full
of debt in what situation its solvency is subjected to strain that is severe. Similarly
the profitability that is significantly diffent would uncover if the firm can back
provide sufficient go towards the owners of its in respect with the danger for you.
2] Operating efficiency: One more measurement of the helpful with this ratio
evaluation, pertinent from the view of management, is it throws light regarding the
known amount of effectiveness in management and utilization of its property. The
action that is different evaluate the style of operational effectiveness. In reality,
the solvency of any company is, inside the analysis that is supreme based on this
product income profits generated by the use of its assets complete in addition to
its components.
3] profitability that is general Unlike the outsides people, and they are keen on one
facet of the financial position of this tight, the control is continually concerned
about overall profits for the company. That is, they truly are worried in relation to
the ability of this tight to fulfills its short-run and long-term responsibilities to the
creditors of its, to guarantee a go that is fair to its owners & protected
utilization that is optimum with assets regarding the tight. This's feasible if a view
that is integrated taken & the majority of the ratios are thought to be together.
OBJECTIVE OF THE STUDY:

To understand the information contained in financial statements with a view to

know the strength or weaknesses of the firm and to make forecast about the
future prospects of the firm and thereby enabling the financial analyst to take
different decisions regarding the operations of the firm.

1. To study the present financial system at Reliance Industry.

2. To determine the Profitability, Liquidity Ratios, Cash flow and Fund
flow statement.
3. To analyze the capital structure of the company with the help of
Leverage ratio.
 NEED OF THE STUDY:

1. The analysis assists you to recognize the pofitableness keeping of the company.
2. the investors are assisted by the scholarly study the money of theirs.
3. The analysis allows the positioning that is monetary of company.
4. The analysis allows the business to see its position that is competitive its rivals
by whom the company will extra enhance the performance of its getting
enjoyment from increased name among acquisitions.
SCOPE OF THE STUDY:

1. 1. The analysis is predicated on the accounting information of reliance

industries restricted.
2. 2. The analysis spreads on the amount that is total of to 2021for
assessing the funds like fiscal record and analysis.
3. The analysis is started regarding the place that is financial of firm with
the utilization of ratio analysis,trend relative statements and analysis.
Research Methodology:
 Research is called an organized, gathering analysis and recording of data about issue related
to the area that is specific.
 It establishes strength reliability as well as precision of the venture.

1. Research Design: analysis Design pertains to the great research approach or maybe concept
used for a job that is certain. A research project requires to be the conducted scientifically
ensuring that the info is gathered economically and adequately.
The analysis utilized a descriptive investigation look for the objective of buying an insight
throughout the problem. It is providing a picture that is exact of few aspects of industry
environment. Descriptive analysis is utilized once the goal is providing a conclusion that is
arranged's as factual and accurate as possible.
2. Method of information Collection:

Secondary Data: Through on line and also printed data

Limitations:
1. Ratios require quantitative info for assessment though it's not decisive about analytical
outcome.
2. The figures in a couple of of pages will likely be at the least many months away from date,
consequently might not create a good indication of airers4you 's present position that is
financial.
3. No understanding that is major utilized as a result of research.
4. Figures for the assessment are taken from the accounts that are yearly.
5. The duration for the analysis ended up being on a five days.
6. Was not qualified to pool info due to privacy maintained by the company.
 CHAPTER – II REVIEW OF LITERATURE
Yunus, N.M.,Malik,S.A. (2012) us states that the usage of fiscal model is
predicting the functionality of a company evaluation that is.The theoretical the
improvement of design is finished using the matrix formula regarding the matlab
software.The design will be validated because of the company that is specific business
effectiveness to ascertain the forecasting accuracy.

Hooks, Jill. (2007) discovered that this analysis that is particular the monetary
performance evalution of 3 entities more than a 15 12 months period.The goal is
determining the effect of corporatization,commercialization plus ownership type on
the reported economic performance of 3 entities.

Wei, Sun. (2010) found that this paper that is specific several theories of this strategy
of performance evalution, analyses merit also as disadvantage of these theories.this
mag comes ahead the unit of performance evalution using the mehod of fuzzy
mathematics.this newspaper validates the correctness associated with the unit of
performance evalution with all the instance that is current.

Hajek, P.,& Olej, V. (2014) discovered that a methodology is produced by

this paper to get principles which contain qualitative info from company reports.The
that is annual causes it become simple to effortlessly examine the axioms with
potential financial performance.The results claim that yearly reports differ in regards to
to the tips emphasized reflecting future performance that is financial.
 CHAPTER - III

COMPANY PROFILE:

Reliance Industries Ltd. is India's biggest private sector business, generating revenues of 1dolar1
19.97 billion, or perhaps more than three % of India's overall gross domestic item. Created as a
textiles business, Reliance has successfully performed an integration that is backward which has
transformed it into India's biggest private sector petrochemicals company, and quantity 2 overall
(behind state owned India Oil). Reliance's petrochemicals division is entirely included and also
includes manufacturing and exploration; improving (the company has generated among the
world's biggest & amp; most contemporary refinery buildings at Jamnagar in Gujarat);
advertising, by using a chain of over 1,000 service stations; aswell as the creation of
petrochemicals, polyester intermediates, polyester, including polymers, as well as others. These
substances are utilized to greatly help Reliance's ongoing textile functions , and that focus
especially in the generation of polyester materials. Following the 2004 acquisition of Trevira,
the continuing business is now the planet's reputable polyester supplier, with production amounts
topping twenty five million meters per season. The company 's textile assortment includes some
other fabrics , like acrylics, and also finished garments.
Reliance Industries belongs to the continuation of India's business success story that is best
following the country 's freedom. Founded by Dhirubhai H. Ambani in 1958, Reliance grew to
holdings that are incorporate circulation and energy production, telecommunications, and capital
finance. After a public feud between Mukesh D. Younger brother Anil and ambani, these
businesses were split off into a new company managed by Anil Ambani. Reliance Industries
shows up on the Mumbai Stock Exchange. Mukesh Ambani is managing director and company
chairman.
Rags in 1958

Dhirajlal Hirachand Ambani (Dhirubhai had been a nickname) arrived into this world to a
smaller middle class schoolteacher's family product in Chorwad, an impoverished town in
Gujarat in 1932. As opposed to being truly a teacher himself--because the family members could
not manage to send him onto university--the Ambani that is small traveled the port city of Aden
at the era of sixteen. There, Ambani started working as
a clerk pumping gasoline at a service station. Ambani stayed in Aden for almost decade, soaring
to be Burmah Shell 's advertising manager. By then, however, Ambani had started to dream of
founding the business that is own of.
Ambani quit Burmah Shell also for time been effective in the insurance coverage area. Into the
late 1950s, the political circumstance in Aden had become progressively unstable. In 1958,
consequently, Ambani determined to India and start up a small business as an exporter of Indian
products to Aden. Finding housing for the family that is young of in the Mumbai slum, Ambani
within the beginning rented office space, or perhaps quite a table, for 2 hours each time. At
first, Ambani's exports provided spices and clothing.
Textiles, you start with textile yarns, which Ambani sold to textile manufacturers, provided
Ambani with their product sales that are best, and fast became the company's concentration.
Ambani also quickly proved himself skilled at negotiating the bureaucracy that is complex of
socialist Indian authorities. Specially, Ambani been able to get a system of interactions with
the country 's political leaders, which includes Prime Minister Indira Gandhi. In this manner,
Ambani got an industry that is thriving and importing polyester, rayon, and nylon. Into the
1960s that are mid Ambani developed however greater ambitions, becoming motivated to find
yourself in textile manufacturing. The corporation create its factory that is 1st in, putting him in
competition along with his customers. Success within the brand new venture arrived quickly,
utilizing the launch of the popular Vimal cloth brand name. By the conclusion associated with
the decade, 4 factories were operated by Ambani. Part of the company's achievement came from
its dedication to work with simply many modern, really effective production equipment. This
way, airers4you quickly outpaced competitors, which depended on equipment often years old. In
to the beginning 1970s, nonetheless, India's economic climate stayed dominated by a handful
of families; they controlled practically every industry between them, and under the auspices of
the Indian authorities. This incorporated the textile business, whose distribution aspect quickly
formed an obstacle towards the development of Ambani's fabric product sales. The company 's
very own clothes fashions in reaction, Ambani became motivated to create the own distribution
arm of his, which later on included not just the sale of raw garments, but in addition.
 Public Offering Revolution in 1977

The child that is"old system which dominated India's political, manufacturing, also financial
circles similarly intended that Ambani must look somewhere else for buy money to back his
growing ambitions. Stop from capital from the Indian authorities, Ambani rather took the stage
that will be revolutionary of at the stock market. In 1977, Ambani circulated Reliance Textile
Industries' initial offering that is publicIPO). The IPO, of 2.8 million stocks, nurtured 1dolar1 1.8
million, and had been seen among the biggest in India at the moment. By circumventing the
mainstream reliance in the express for capital purchase, Ambani sparked a revolution in Asia,
and was commonly acknowledged for setting the stage making use of the nation 's growth as an
important production center that is local.
Ambani's deftness at operating the Indian bureaucracy allowed him to make the most associated
utilizing the nation 's arcane license process, which in addition imposed import that is firm,
practically assuring permit holders connected with a captive market. A license had been
received by Ambani to generate a factory in Patalganga to create polyester filament yarn in 1981,
for example. Immediately after production premiered by the factory, the authorities that are
indian elevated import responsibilities on polyester yarn. The Patalganga plant conducted the
phase that is second of in 1985. The after period, the web site included a brand polyester that is
new fiber grow also.
Into the start 1980s, Ambani had been accompanied by sons Anil and Mukesh. Each ended up
being routed towards the united states for the scholarly education of theirs as well as, upon their
return to India, possessed a component that is prominent applying Reliance's following phase of
development. Exactly like business had moved through the purchase of textiles to your model of
theirs, Reliance became motivated to aid keep its integration that is backward to able to create
the harsh chemical substances from just what the textile yarns have been made. The business 's
brand name system that is new it to get involved with the petrochemicals business, creating its
first vegetable of the generation of purified acid that is terephtalic 1986. In that period, making
use of a swing that staying Dhirubhai Ambani partly paralyzed, the company 's day-to-day
course had been taken over by brothers Anil and Mukesh. Their father nonetheless remained
chairman and the leading fingers of the company's development until the loss of their in 2002.
The summer season that is after airers4you included an item for the generation of linear alkyl
benzene, followed closely by the opening of the paraxylene grow in 1988. The business and then
started making a brand name petrochemicals being brand new at Hazira, which started
production of vinyl chloride monomer and
polyvinyl chloride. Both in polyesters along with in polymers in this manner, airers4you created
industry leadership. By 1992, the ongoing business had launched production of high density
polyethylene at the Hazira complicated also.
Indian Petroleum Giant the 21st Century

Reliance's straight integration approach clearly led to an curiosity about extending the operations
of its to oil refining, as well as to research and production. Yet these sectors stayed tightly under
state management, utilizing the nationalization about the Indian oil market in 1976 amid the oil
dilemmas that is worldwide. Although the continuing state owned oil companies had the
capability to satisfy up with home need through the 1980s, by the start 1990s, the nation 's pre-
existing oilfields have already been showing indications of depletion. At precisely the period that
is want that is same up being rising steadily, though the engine oil companies, propped in place
by state financial help, had been extremely strapped for bucks to invest cash on additional
exploration efforts. An endeavor that is original liberalize the generation and also refining sectors
failed, nonetheless, amid intense union protests.
In the meantime, Reliance made formulations for the action in to the oil company. In 1991,
airers4you create a subsidiary that is fresh Reliance Refineries Private Ltd., obviously signaling
its objectives. The subsidiary later changed the name of its to Reliance Petroleum Limited, and
additionally in 1993 circulated a offering that is general public that then was India's biggest ever
IPO. While Reliance affirmed the plans of its to construct India's oil refinery that is biggest,
airers4you started building its oil items advertising and distribution operations, integrating
something of a few 1,000 solution stations.
Reliance carried on to pioneer funding paths in India. In 1993, for example, airers4you had
become abdominal muscles business that is first is indian increase capital regarding the overseas
market, via an international Depositary Receipt (GDR) problem in Luxembourg. A minute GDR
that is issue that is successful was carried out by the company. The business used the capital that
is part that is new develop its petrochemicals wing, creating the globe's biggest multi feed
cracker at the Hazira website. The business also included manufacturer life for monoethylene
glycol, polyethylene, also purified acid that is terephthalic. Manufacturing in 1998 premiered by
the units which are brand new.
Reliance's possibility for entry into crude oil refining arrived in 1997, if the oil that is indian
arrived at a continuing state of near collapse. Struggling to invest in more exploration functions,
and lacking the centre that is administrative grow its current manufacturing, the us government
that is federal pressured to liberalize the field. For the good reason that
Year, a scheme was established by Reliance to construct one of the planet's& amp that is
biggest; most contemporary crude oil improving complexes in Jamnagar, Gujarat, at a price of
several six dolars billion. The government that is federal to your strategy, and in addition
provided the company the absolute most useful to import oil right, rather of analyzing Indian Oil,
that assisted Reliance significantly decrease expenses which are operating.
Built in an interval that is short of period, the Jamnagar site finished up being commissioned in
1999. Your web site 's manufacturing ability ended up being dual that of each and every other
refinery that is indian also rated regarding the range of top 5 in the earth. The addition related to
new center also put Reliance at the ranking that is high of country 's individual sector
organizations. In 2002, Reliance Petroleum wound up being merged into Reliance Industries,
that later became among the country 's top 3 companies, which includes state owned entities.
Breaking apart in 2006

Dhirubhai Ambani passed away in 2002, moreover the Ambani brothers had taken over as heads
regarding the business. In that period, airers4you enhanced its dominance associated with the
country 's petrochemicals sector through its purchase of main sector that is private Indian
Petrochemicals Corporation. Additionally in 2002, Reliance released a diversification effort,
concentrating on the telecommunications sector, particularly the fast growing phone industry
that is cellular. Reliance create the own phone service of its, Reliance Infocomm, in that period
that is particular.
The oil business remained the business 's significant development focus. In 1999, the national
government that is indian off twenty five blocks for exploration; bids have been provided into
the type of royalty portion provides. Reliance received twelve regarding the obstructs and faster
devote position its staff that is unique of experts, supported by oilfield services from
Schlumberger and Halliburton. Reliance's investment quickly paid down in the choosing of
propane reserves estimated at some fourteen trillion cubic feet, probably the fuel industry that is
largest found in Asia in years, in the Krishna Godavari Basin in the Bay of Bengal. In 2004,
airers4you hit again, locating a brand gas that is new in the Bay of Bengal, off the Orissa Coast.
Buoyed by the research that is effective of its, Reliance unveiled an expansion that is committed
for the 2nd one 50 % of the 2000s. The company 's plans provided a six dolars billion expansion
associated with the Jamnagar site, doubling it in dimension and making it the world's refinery
that is biggest by 2009. Business additionally announced it meant to invest ten dolars billion on
extra oil exploration efforts, focusing on the market that is offshore. This method, airers4you
desired to tenfold improve its creation by the end
of the century. During the other end of the oil sector, airers4you circulated a 1dolar1 1.5 billion
development of its Reliance gas place chain, with the aim of 6,000 stations. The company also
expanded internationally, turning the world's leading producer of polyester yarn with all the
current acquisition of Germany's Trevira. Also, the company boosted its telecommunications
wing, obtaining U.K. based FLAG Telecom, an operator of the 50,000 kilometer fiber that is
underwater network that is optic.
In the meantime, growing tensions between Mukesh and also Anil Ambani discovered a head in
late 2005, whenever a disagreement that is long is simmering organization approach broke down
into an open and hugely publicized feud. A truce was brokered by the brothers' mom, whom
proposed a breakup of Reliance Industries into 2 nearly equal parts in the end. Mukesh Ambani
remained as top of this organization's oil, petrochemical, and textiles functions, and Anil Ambani
regrouped the company 's telecommunications, money finance, power, and also other operations
as a brand business that is brand new. The breakup of the ongoing company had taken place in
2006. As a result, Reliance Industries emerged as a concentrated and oil that is truly integrated
petrochemicals opposition to your global heavyweights.
Major Subsidiaries

Reliance Industrial Holdings and Investments Ltd.; Reliance Infrastructure Limited; Reliance
Middle East DMCC (U.A.E.); Reliance Netherlands B.V.; Reliance Petroleum Limited; Reliance
Retail Limited; Reliance Strategic Investments Limited; Reliance UK Ltd. (fifty percent);
Reliance Ventures Ltd.
Significant Competitors
Indian Oil Corporation Ltd.; Hindustan Petroleum Corporation Ltd.; Bharat Petroleum
Corporation Ltd.; Indian Petrochemicals Corporation Ltd.; Mangalore Refinery and
Petrochemicals Ltd.; Kochi Refineries Ltd.; Chennai Petroleum Corporation Ltd.; Parker
Agrochem Exports Ltd.

Reliance Industries Limited (RIL) can be an conglomerate that is indian is multinational

headquartered in Mumbai, Asia. Reliance owns businesses across India interested in energy,
petrochemicals, retail, normal resources, textiles, and telecommunications. Reliance is just about
the businesses which are satisfying India,[3] the biggest publicly exchanged company in Asia by
industry capitalisation,[4] and the organization that is biggest in India as assessed by profits after
recently surpassing the government controlled Indian Oil Corporation.[5] On ten September
2020, Reliance Industries developed in to the very first provider that is indian cross 1dolar1 200
billion in industry capitalisation.
The organization is placed 96th on the Fortune Global 500 summary connected with the world 's
biggest companies as of 2020. It's positioned 8th among the list of Top 250 worldwide Energy
Companies by Platts as of 2016. Reliance is India's exporter that is biggest, accounting for eight
per cent of India's full product exports having a value of ₹1,47,755 access plus crore to areas in
hundred eight countries.[8] Reliance is liable for pretty much five % with this authorities of
Asia's complete profits from techniques and/or responsibility that is excise. It's likewise the
income taxation payer that is greatest in the sector that is personal India.

History 1960 1980 the continuing business was co founded by Dhirubhai Ambani and
Champaklal Damani in 1960's as Reliance Commercial Corporation. In 1965, the partnership
completed and Dhirubhai carried on the polyester companies on the business.[10] In 1966,
Reliance Textiles Engineers Pvt. Ltd. was included in Maharashtra. It established an synthetic
materials mill within the period that is exact is same Naroda in Gujarat.[11] On eight May 1973,
it became Reliance Industries Limited. In 1975, airers4you expanded its company into textiles,
with "Vimal" obtaining the make that is major of in later periods. The company held its offering
that is initial that publicIPO) in 1977.[12] The problem ended up being over subscribed by 7
times.[13] In 1979, a textiles provider Sidhpur Mills was amalgamated because of the company.
[14] In 1980, the company broadened its polyester yarn organization by establishing a Polyester
Filament Yarn Plant in Patalganga, Raigad, Maharashtra with technical and cooperation that is
financial E. I. du Pont de Co. and Nemours, U.S.
 INDUSTRY PROFILE:
Introduction
Asia features a sector that is diversified is monetary fast expansion, both with
regards to strong growth of present financial solutions companies also fresh
entities going into the industry. The field comprises banking that is commercial,
insurance coverage companies, non banking financial organizations, pension funds,
co-operatives, mutual funds and additionally other smaller financial entities. The
banking regulator has allowed brand name entities that are new payment banks
being produced recently, consequently adding to your kind of entities operating in
the industry. Nevertheless, monetary industry in Asia is predominantly a banking
industry with company banks accounting for over sixty four per cent associated
with the entire assets held through the system that is monetary. The Government of
India has founded reforms being many liberalise, manage also as improve this
industry. The Government and Reserve Bank of India (RBI) have actually actually
taken steps that are numerous facilitate access that is easy to spend money on for
Micro, moderate and little Enterprises (MSMEs). These actions contain presenting
Credit Guarantee Fund Scheme for MSMEs, issuing rule to banking institutions
regarding collateral requirements and starting a Micro models Development and
Refinance Agency (MUDRA). By having a thrust that is consolidated private
sector and national, India is unquestionably certainly one worldwide's numerous
lively money areas.
Industry Size At the full time of 2020, Assets Under Management (AUM) handled
through the fund that is mutual endured at Rs. thirty lakh crore (US1dolar1 407.39
billion) november. Inflow in Asia's shared investment schemes via the Systematic
Investment Plan (SIP) path hit Rs. 82,453 crore (US1dolar1 11.70 billion) in 2019.
Equity mutual funds registered a inflow that is net of. 8.04 trillion (US1dolar1
114.06 billion) by conclusion of 2019 december.
Yet another element that is vital of's economic business might be the insurance
coverage business. Insurance policy business is growing at a speed that is quick.
The season that is initial of life insurance firms hit Rs. 2.59 lakh crore (US1dolar1
36.73 billion) in FY20.
Additionally, Asia's top bourse, Bombay Stock Exchange (BSE), will likely set up
a joint undertaking with Ebix Inc to produce a strong insurance distribution system
into the nation by way of a brand brand division exchange platform that is brand
new.

Investments/Developments
24
• In November 2020, LIC had taken initiatives to facilitate faster proposal completion by
introducing an program that is electronic ANANDA.
• in 2020, Paytm noted 2x development in electronic gold transactions within the last 6 months
november. New business have actually raised fifty per cent since the economic 12 months plus
the purchase that is normal has risen by sixty %.
November• In 2020, the Reserve Bank of India (RBI) announced establishment of its Innovation
Hub. This specific effort will create an ecosystem to be in a position to encourage access to
monetary services and also products and additionally foster financial inclusion. The Innovation
Hub of the Reserve Bank (RBIH) is designed to promote innovation throughout the sector that
is leveraging that is monetary and making a favorable environment for innovation.
• VC investments grew to US1dolar1 3.6 billion in July September 2020 from US1dolar1 1.5
billion into the quarter that is prior driven by the mega offers, like the US1dolar1 1.3 billion
elevated through the web retailer - Flipkart.
• On November six, 2020, WhatsApp started its UPI payment products in Asia on getting the
National Payments Corporation of India (NPCI) endorsement to' Go Live' on UPI in a fashion
that is graded.
• In October 2020, Unified Payments Interface (UPI) captured 2.07 billion transactions well rs
which are well worth. 3.86 lakh crore (US1dolar1 52.10 billion).

Federal Initiatives

• In November 2020, the Union Cabinet authorized the government that is us equity infusion get
ready for Rs. 6,000 crores (US1dolar1 814.54 million) within the NIIF financial obligation
Platform funded by the commercial infrastructure and Investment Fund (NIIF) consisting of
Aseem Infrastructure Finance Limited (AIFL) and NIIF Infrastructure Finance Limited (NIIF)
(NIIF IFL).
• In November 2020, 2 MoUs was at fact finalized - 1 between India worldwide Exchange (India
INX) and Luxembourg inventory market and also another between State Bank of India and
Luxembourg Stock market for cooperation in financial services, ESG (ecological, societal and
finance that is governance that is green within the neighborhood shop.
• on eleven, 2020, The Cabinet Committee on Economic Affairs authorized revamping and
continuation of the pattern for financial assist with public-private november
partnerships (PPPs) in' Infrastructure Viability Gap Funding (VGF) Scheme' until 2024 twenty
five having a cost that is complete of. 8,100 crore (US1dolar1 1.08 billion).

Street Ahead

• India is anticipated to become the 4th largest wealth that is personal worldwide by 2028.
• India is now one of numerous most lively economies that are worldwide a corner of strong
insurance and banking sectors. The leisure of international investment rules has gotten an
outcome that is optimistic the insurance coverage industry, with numerous companies plans that
are announcing boost the stakes of theirs in jvs with Indian companies. Throughout the future
quarters, there might be numerous venture that is joint between worldwide insurance giants
& regional players.
• The Association of Mutual Funds in India (AMFI) is targeting very nearly five development
that is fold AUM to Rs. ninety five lakh crore (US1dolar1 1.47 trillion) and over 3 times
development in investor profiles to 130 million by 2025.
• India's mobile wallet sector is thought to produce at a Compound Annual Growth Rate
(CAGR) of 150 % to achieve US1dolar1 4.4 billion by 2022, while mobile finances transactions
will touch Rs. thirty two trillion (USD1dolar1 492.6 billion) throughout the really exact time that
is same.

The united states 's financial solutions market includes capital areas, insurance area and banking
that is non that are monetaryNBFCs). Asia's yucky price that is nationwide (GDS) as a portion of
Gross Domestic Product (GDP) stood at 30.50 percent in 2019. In 2019, US1dolar1 2.5 billion
was indeed elevated across seventeen first offerings which are publicIPOs). The number of Ultra
High Net Worth Individuals (UHNWI) are believed to improve to 10,354 in 2024 from 5,986 in
2019 and it's placed 12th in the summary of countries with many of us being such.

India has scored outstanding ten in protecting investors' protection under the law for a corner of
reforms used by Securities aswell as Exchange Board of India (SEBI) within the World that is
worldwide Bank Ease of performing business 2020 report.
The asset management market in Asia is among probably the fastest growing regarding the
planet. In March 2019, company investors Assets Under Management (AUM) endured at Rs.
9.55 lakh crore (US1dolar1 136.59 billion), while retail investors and HNWIs hit Rs. 7.52 lakh
crore (US1dolar1 107.55 billion Rs. and) 6.30 lakh crore (US1dolar1 90.12 billion), respectively.
In the Asia Pacific area,
India is among the very best 5 nations in terms of HNWIs. Picking a HNWIs in India hit
263,000 by summary of 2019. Between 2014 too as 2019, number of HNWIs in Asia discovered
a rise that is constant developing at a CAGR of 3.9 %.
Mutual Fund (MF) industry 's Assets Under Management (AUM) grew from Rs. 10.96 lakh
crore (US1dolar1 156.82 billion) in . Inflow in Asia's shared fund schemes via the Systematic
Investment Plan (SIP) path hit Rs. 82,453 crore (US1dolar1 11.70 billion) in 2019. Equity
mutual funds registered a inflow that is web of. 8.04 trillion (US1dolar1 114.06 billion) by
conclusion of 2019 december.
Sixteen percent property about the fund that is had that is shared produced from B30 places in
September 2020. Assets from B30 places increased from Rs. 4.45 lakh crore (US1dolar1 59.65
billion) in 2020 to Rs. 4.47 lakh crore (US1dolar1 60.77 billion) in September 2020, representing
an increase of 0.37 % august. The government of Asia has brought numerous measures to deepen
reforms into the main city sector, including simplification connected with the IPO procedure,
allowing qualified international investors (QFIs) to help make use of the bond market that is
indian. In 2019, purchase in Indian equities by global portfolio investors (FPIs) moved five high
of Rs. 101,122 crore (US1dolar1 14.47 billion) 12 months. Investment by FPIs in India's capital
industry obtained a rs being web 12.52 lakh crore (US1dolar1 177.73 billion) between FY02-21
(till ten, 2020) august.
On November eleven, 2020, The Cabinet Committee on Economic Affairs authorized revamping
and continuation concerning the pattern for monetary help public partnerships that are
personalPPPs) in' Infrastructure Viability Gap Funding (VGF) Scheme' until 2024 25 with a cost
that is complete of. 8,100 crore (US1dolar1 1.08 billion). The federal government that is federal
also authorized hundred per cent FDI for insurance intermediaries. The insurance coverage
segment could be opened to seventy four % FDI through the current forty nine percent.
 CHAPTER – IV THEORETICAL FRAMEWORK
CLASSIFICATIONS OF RATIOS:
1. The usage of ratio examination isn't limited to financial manager just. You
will find various people enthusiastic about the ratio analysis for
comprehending the position that is monetary of firm for various purposes.
Different accounting proportions may be classified the following:
2. 1. Traditional Classification
3.
4. 2. Functional Classification
5.
6. 3. Significance ratios

Traditional Classification

The following is included by it.

• stability sheet ( or possibly) position statement ratio: They cope

with the bond between 2 balance sheet items, e.g. the ratio of current house to
present liabilities etc., both things should, nonetheless, have actually doing
with similar feeling of balance sheet.
• Profit & damage bank account (or perhaps) earnings
statement proportions: These proportions deal with the text between 2 profit
& loss account products, e.g. the ratio of disgusting income to sales etc.,
• Composite ( and sometimes even) inter declaration proportions:
These proportions reveal the relation from a return & damage bank
account or possibly income statement item along with a balance sheet items,
e.g. stock return ratio, or the ratio of complete assets to sales.
2. Practical Classification

These consist of liquidity ratios, profitability ratios and activity

ratios, leverage ratios and term solvency that is long.
3. Significance ratios

Some ratios are critical compared to the others as well as the firm
may classify them as extra and ratios that are primary. The ratio that is main
an, that is of this value that is primary a concern. The various other ratios that
support the ratio that is main called secondary ratios.
 IN THE VIEW OF FUNCTIONAL CLASSIFICATION THE RATIOS
ARE

1. Liquidity ratio

2. Leverage ratio

3. Activity ratio

4. Profitability ratio

1. LIQUIDITY RATIOS
Liquidity describes the capability of a concern to meet its responsibilities that are present & when
there becomes thanks which can be many. The short-run responsibilities of this company may indeed be
met whenever there're sufficient assets that are liquid. The short-run responsibilities are greeted by
realizing amounts from present, floating ( or perhaps) circulating property Today's assets needs to be
either estimated fluid (or) near liquidity. They must be convertible into money for being forced to invest
obligations of short-term nature. The sufficiency (or) insufficiency of existing assets must be evaluated by
considering them with brief term liabilities that are current. If present-day assets find a way to be debts
that are beneficial are current subsequently liquidity task is probably to be positive.
To enable you to determine the liquidity of a company the proportions that are next determined

• Current ratio

• fast (or maybe) Acid test (or) fluid ratio

• Absolute fluid ratio (or) Cash job ratio

a) CURRENT RATIO:

Current ratio could be referred to as the connection between current liabilities and assets that are current.
This ratio also known as capital that is working is just a level of common liquidity that will be most
popular to create the evaluation associated with the short-term monetary place (or simply) liquidity of any
firm.

(b)QUICK RATIO:

Quick ratio is definitely an exam of liquidity than today's ratio. The term liquidity defines the
ability of a ongoing company having to pay its brief term obligations as & once they begin
to be due. Quick ratio might be referred to as the connection between fast or present liabilities

36
and assets that are liquid. A benefit is known to be fluid in case it's converted into cash with in a
right time that is quick no lack of value.

37
 QUICK ASSETS CURRENT LIABILITIES

Cash in hand Out standing or accrued expenses

Cash at bank Bank over draft

Bills receivable Bills payable

Sundry debtors Short-term advances

Marketable securities Sundry creditors

Temporary investments Dividend payable

Income tax payable

(c)ABSOLUTE LIQUID RATIO

Although receivable, debtors aswell as re repayments receivable are commonly

more fluid than inventories, yet there might be doubts concerning the
comprehension of theirs into cash straight away or even in time. Thus, complete
fluid ratio must in addition be calculated along with quick ratio and current ratio to
exclude actually receivables from today's home and also find the whole fluid
assets.
Absolute liquid assets

Absolute liquid ratio = Current liabilities

Components of Absolute Liquid Ratio

ABSOLUTE LIQUID ASSETS CURRENT LIABILITIES

 Cash in hand Out standing or accrued expenses

Cash at bank Bank over draft

Interest on Fixed Deposit Bills payable

Short-term advances

Sundry creditors

Dividend payable

Income tax payable

2. LEVERAGE RATIOS
 The solvency or leverage ratio describes the ability of a issue to satisfy
its obligations that are long-run. Accordingly, long-term solvency ratios
suggest company 's feasible to meet the fixed costs and interest and
payment schedules related to its long-run borrowings.
 The ratio that is after the objective of determining the solvency of the
problem.
 PROPRIETORY RATIO

A variant to the debt-equity ratio is the proprietory ratio which is

also known as equity ratio. This ratio establishes relationship between share
holders funds to total assets of the firm.

Shareholders funds

Proprietory ratio = Total assets

SHARE HOLDERS FUND TOTAL ASSETS

 Share Capital Fixed Assets
Reserves & Surplus Current Assets
Cash in hand & at bank
Bills receivable
Inventories
Marketable securities
Short-term investments
Sundry debtors
Prepaid Expenses

3. ACTIVITY RATIOS
Funds are purchased many assets that are very different small business to generate
product product sales and earn profits. The effectiveness with exactly what assets
are handled impact that is amount that is correct of sales. Task ratios determine the
effectiveness ( or possibly) efficiency with that a company manages the resources
of its ( or even) assets. These proportions may be known additionally as "Turn over
ratios" since they suggest the pace with what assets are converted or even switched
over into product sales.
• Working capital turnover ratio

• Fixed assets turnover ratio

• Capital turnover ratio

• Current property to fixed assets ratio

(a)WORKING CAPITAL TURNOVER RATIO

Working capital of a concern is directly related to sales.

Working capital = Current assets - Current

Working capital = Current assets - Current liabilities

It indicates the velocity associated with usage of net operating

 money. This means the no. of occasions the capital that is working
transformed over within the program of a period. A better ratio
shows effective utilization of working capital along with a ratio
that is reduced utilization that is ineffective.
Working money turnover ratio=cost of products money that is
sold/working.

Components of Working Capital

CURRENT ASSETS CURRENT LIABILITIES

Cash in hand Out standing or accrued expenses

Cash at bank Bank over draft

Bills receivable Bills payable

Inventories Short-term advances

Work-in-progress Sundry creditors

Marketable securities Dividend payable

Short-term investments Income-tax payable

Sundry debtors

Prepaid expenses

(b)FIXED ASSETS TURNOVER RATIO

It's likewise known as product sales to home ratio that is fixed. This ratio measures the efficiency along
with revenue ability that is generating of tight. Greater the ratio, greater could possibly be the utilization
that is intense of home. Under usage of fixed assets is included by reduced ratio.

Cost of Sales

Fixed assets turnover ratio = Net fixed assets

Cost of Sales = Income from Services

41
 Net Fixed Assets = Fixed Assets - Depreciation

(c)CAPITAL TURNOVER RATIOS

Occasionally the effectiveness and effectiveness of this firms are

gauged by taking a look at the price of sales or sales with quantity of capital
bought the ongoing company in place of with assets held in the business,
although in both cases outcome that is comparable expected. Capital purchased
the business could be classified as short-term and capital that is long-term
maybe as fixed money and money that is working even Owned Capital and
Loaned Capital. All Capital Turnovers are estimated to learn the applications
of money.

Cost of goods sold

Capital turnover ratio = Capital employed

Cost of Goods Sold = Income from Services

Capital Employed = Capital + Reserves & Surplus

(d)CURRENT ASSETS TO FIXED ASSETS RATIO

This ratio varies from industry to company. The increase within the ratio suggests that trading is slack or
possibly mechanization is used. A drop in the ratio implies that debtors as well as in addition shares are
improved fixed or too assets tend to be more used intensively. If current assets grow using the expansion
that is earnings that are corresponding it will show the organization is growing.
 Current Assets to Fixed Assets Ratio = Fixed Assets

Component of Current Assets to Fixed Assets Ratio

CURRENT ASSETS FIXED ASSETS

Cash in hand Machinery

Cash at bank Buildings

Bills receivable Plant

Inventories Vehicles

Work-in-progress

Marketable securities

Short-term investments

Sundry debtors

Prepaid expenses

4. PROFITABILITY RATIOS

The primary goals of business undertaking are making money. Because earnings may be the
engine, which moves the corporation that is continuing.
• web profit ratio

• Return on complete assets

• Reserves and also surplus to money ratio

• Earnings per share

• Operating profit ratio

• Price - making ratio

• Return on investments
 CHAPTER – V
DATA ANALYSIS AND INTERPRETATION
THE RELIANCE INDUSTRIES LIMITEDCOMPANY RATIO
CALCULATION
 Calculation and Interpretation of Ratios
1] Current Ratio:
Formula:

Current assets Current ratio = Current

liabilities

YEAR 2016 -2017 2017-2018 2018 -2019 2019 -2020

Current assets 24,696.15 30,210.99 44,743.86 56,298.09
Current liabilities 21,547.00 25,858.06 32,221.16 45,675.71
Current ratio 1.14 1.16 1.38 1.23
60,000.00

50,000.00

40,000.00
Current assets
30,000.00
Current liabilities
20,000.00 Current ratio

10,000.00

0.00
2016 -2017 2017-2018 2018 -2019 2019 -2020

Comments:

The ratio that is latest is 1.23:1 in 2019 2020. It indicates that for a rupee that is solitary of debts,
today's assets are 1.23 rupee can be obtained in the them. The home that is current 1.23
occasions the present liabilities in other words.
Nearly four years present ratio is exact exact same but present ratio in 2018 2019 is bit greater,
making business sounder. The consistency boost in the importance of existing assets will raise
the capability of the organization to meets its responsibilities & so through the perspective
of creditors the continuing business is a lot less risky.
Therefore, today's ratio throws light on the company's possible paying out the current liabilities
of its from its assets being current.
2] Quick Ratio:

For
mul Quick assets Quick ratio = Quick liabilities
a:
YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020
Quick assets 14,576.33 18,674.48 24,227.75 36029.91
Quick liabilities 21,547.00 25,858.06 32,221.16 45,675.71
Liquid ratio 0.67 0.69 0.75 0.78

50,000.00
45,000.00
40,000.00
35,000.00
30,000.00
25,000.00
20,000.00
Quick assets
15,000.00
Quick liabilities Liquid ratio
10,000.00
5,000.00
0.00

2016 -20172017 -20182018 -20192019 -2020

Comments:
Quick ratio or the liquid suggests the position that is fluid is economic of
enterprise. Very nearly in most four years the fluid ratio is identical, and that is
a lot better for the organization to generally meet up due to the urgency. The
ratio that is grown that is fluid 0.67 to 0.78 in 2019 2020 that business stay
with poor liquidity spot to attain higher profits.

This implies that the dependency on the long-range liabilities & creditors
are more & the firm is after a committed capital policy that is working.
 Liquid ratio of business is not beneficial as the quick assets of this organization
are less than the liabilities.The that is fast ratio exhibits the business 's potential
to generally hook up featuring its instant responsibilities promptly.

3] Proprietary Ratio:

Formula:
Proprietor’s fund
Proprietary ratio = Total assets
OR
Shareholders fund Proprietary ratio = Fixed
assets + current assets

YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020

Proprietary fund 49,804.26 63,967.13 81,448.60 126,372.97
Total Assets 68,520.72 87,439.93 105,405.58 189,655.07
Proprietary ratio 0.72 0.73 0.77 0.66

200,000.00
180,000.00
160,000.00
140,000.00
120,000.00
100,000.00
80,000.00
Proprietary fund
60,000.00
Total Assets Proprietary ratio
40,000.00
20,000.00
0.00

2016 -20172017 -20182018 -20192019 -2020

Comments:

The Proprietary ratio associated with the company is 0.66 inside the period that keeps growing
2020. It indicates that for every 1 rupee of complete assets contribution of sixty six paisa has
arrived from remaining balance and owners investment thirty four paisa is added through the
creditors that are external. This demonstrates the contribution by owners to property that is
complete way more than the contribution by exterior creditors. As the Proprietary ratio is fairly
beneficial regarding the business. The organization 's long haul solvency task is quite good.
 4] Stock Working Capital Ratio: Formula:

Stock

Stock working capital ratio = Working Capital

YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020

Stock 10,119.82 12,136.51 14,247.54 14,836.72
Working Capital 3149.15 4352.93 12,522.70 10,622.38
Stock 3.21 2.78 1.13 1.39
working capital
ratio

Comments:
16,000.00

14,000.00

12,000.00

10,000.00

8,000.00

6,000.00

4,000.00

2,000.00
2016 -2017 2017 -2018 2018 -2019 2019 -2020
0.00

This ratio reveals that extend of funds obstructed in stock. The amount of stock is diminishing
through the 2016 2017 to 2019 2020 year. However into the season 2019-2020 it is enhanced a
bit. Into the year 2016 2017 the sale is elevated that affects decrease available which effected in
increased capital that is working 2018 2019.It demonstrates the solvency role in the business is
great.
5] Capital Gearing Ratio:

Formula:

Preference capital+ secured loan Capital gearing

ratio = Equity capital & reserve & surplus

YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020

Secured loan 7,664.90 9,569.12 6,600.17 10,697.92
Equity capital &
reserves & 49,804.26 63,967.13 81,448.60 126,372.97
surplus
Capital
16% 15% 8.2% 8.5%
gearing
ratio

140,000.00

120,000.00

100,000.00

80,000.00

60,000.00

40,000.00

20,000.00

0.00
2016 -2017 2017 -2018 2018 -2019 2019 -2020

Comments:

6] Gearing means the process of boosting the equity shareholders return through
the usage of debt. Capital gearing ratio is really a leverage ratio, and that shows
the proportion of equity and obligation that is financial the funding of assets of a
 business.
7] For the prior 2 yrs [i.e.2018 2019 to 2019 2020] Capital gearing ratio is really
numerous identical that displays, near aproximatelly 8.5 percent of the fund
addressing the loan job that is protected. However in the year that is entire -
8] 2017 the Capital gearing ratio is sixteen %. What this implies is that during the
year that is whole 2017 company has borrowed a lot more secured finance due
to the company's development.

9] Debt Equity Ratio:

Formula:

Total long term debt Debt equity ratio = Total

shareholders fund
YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020
Long term debt 21,865.61 27,825.73 36,479.68 73,904.48
63,967.13
Shareholders 49,804.26 81,448.60 126,372.97
fund
Debt Equity 0.44 0.44 0.45 0.59
Ratio

160000
140000
120000
100000
80000
60000
Gross profit
Net sales
Gross profit Ratio

40000
20000
0

2016 -2017 2017 -2018 2018 -2019 2019 -2020

Comments:

The debt equity ratio is important application of fiscal analysis to appraise the
structure that is financial with company. It expresses the connection between
your equities that are outside bodily equities. This ratio is actually important
from the perspective of owners and creditors.
The price of debt equity ratio is improved from 0.44 to 0.59 through the that is
entire 2017 to 2019 2020 year. This demonstrates because of the debt that is
increased the shareholders fund furthermore increased. This shows
long-term capital building of the organization is good. The lower ratio
considered favorable from long creditor that is lasting purpose of view.
10] Gross Profit Ratio:
Formula:

Gross profit

Gross profit ratio = Net sales * 100

YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020

Gross profit 18345.48 25,439.43 30,086.28 25,758.2
Net sales 80,877.79 111,699.03 133,805.78 141,959
Gross profit 22.7 22.7 22.4 18.14
Ratio

160000

140000

120000

100000

80000

60000

40000

20000
2016 -2017 2017 -2018 2018 -2019 2019 -2020
0

Comments:

The income that is gross be the income produced on purchase of services and
products. It's the power on return. Within the year that is entire - 2017 the revenue
that is disgusting is 22.7 percent. It's paid down to 18.14 % within the season 2019
2020 due to rise in sales with matching more increased price of products sold.
It's continually declined from 2016 2017 to 2019 2020 as an overall total result of
extortionate cost of overheads and purchases. Although the revenue that is gross is
declined through the years 2016 2017 to 2019 2020. The income that is total
revenue that is gross constantly increasing from the time 2016 2017 to 2019 2020.

11] Operating Ratio:

Formula:
Operating Profit
Operating ratio = Net sales *100 Operating profit = COGS+

operating
YEAR expenses2016 -2017 2017 -2018 2018 -2019 2019 -2020
COGS +
Operating 68,550.24 91,947.72 109,506.10 118,234.17
expenses
Net sales 80,877.79 111,699.03 133,805.78 141,959
Operating ratio 84.75% 82.31% 81.80% 83.28%

300,000.00

250,000.00

200,000.00
Operating ratio
150,000.00 Net sales
COGS + Operating expenses
100,000.00

50,000.00

0.00
2016 -2017 -2018 -2019 -
2017201820192020

Comments:
The operating ratio exhibits the text between expense of relaxation &
overall income. Operating ratio over several four years when compared that
signify the modification within the effectiveness that is practical of company.

The operating ratio for the continuing company has low in 36 months and also
enhanced somewhat in 12 months that is final. This's as a total result of boost
into the cost of services and products sold, that in 2016 2017 ended up being
84.75 %, in 2017 2018 was 82.31 per cent, in 2018 2019 was 81.80 percent
& in 2019 2020 it's 83.28 per cent. Although the cost has exploded in
2016 2017 as in comparison with 2017 2018, it's bringing down constantly
throughout the following a handful of years, suggest downward pattern in cost
but upward pattern that is/ good operational performance.
 9) Net Profit Ratio:

Formula:

Net Profit After Tax

Net profit ratio = Net sales * 100

YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020

NPAT 9,069.34 11,943.40 19,458.29 15,309.32
Net sales 80,877.79 111,699.03 133,805.78 141,959.00
Net profit ratio 11.21% 10.69% 14.54% 10.78%
160,000.00

140,000.00

120,000.00

100,000.00

80,000.00

60,000.00

40,000.00

20,000.00
2016 -2017 2017 -2018 2018 -2019 2019 -2020
0.00

Comments:

The income that is total of the organization is excessive generally in most the
growing season although web revenue is improving purchase from this ratio of
four period it's been observe that from 2016 2017 to 2018 2019 the internet
revenue is elevated which reduced within the season 2019 2020.
Profitability ratio of company demonstrates increase that is considerable 36 months
and in addition decreased within the last 12 months. Company's gross product
product sales have raised in three years and also reduced within the last year. At
exactly the time scale that is same is lucrative in managing the expenses i.e.
producing & some other costs.
It's an list that is obvious of control, managerial product sales and efficiency
advertising.

10]Stock Turnover Ratio:

Formula:
Cost of Goods Sold
Stock Turnover Ratio = Average stock

YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020

COGS 18,90,98 21,96,32 28,33,02 25,72,26
Average stock 5,49,90 5,97,58 6,73,11 6,89,30
Stock
3.4 3.6 4.20 3.73
Turnover Ratio

4.5
4
3.5
3
2.5
2
Average stock
Stock Turnover Ratio

1.5
1
0.5
0

2016 -20172017 -20182018 -2019 2019 -2020

Comments:

Stock return ratio shows the text involving the sales & inventory it
implies simply just how stock is turned over into income.
The stock turnover ratio is 2016 2017 was 3.4 times that recommend the stock
has been transformed into item sales 3.4 times while in the growing season.
3.4 rounds whilst in the summer season are manufactured by the inventory
cycle. It shall assist working out the inventory holding time; it indicates the
stock return ratio is 3.4 times then a stock holding period is 3.5 days
[12/3.4=3.5months]. This shows it normally takes 3.5 months for inventory
being sold out after it is grown. For the last four yrs stock turnover ratio is
cheaper set alongside the standard though it is in increasing order. The
company has achieved better revenue in to the season 2016 2017 to 2019 2020
the stock turnover ratio has enhanced from 3.4 to 3.73 occasions, it suggests
with reduced stock. Consequently, the inventory on the ongoing company is
moving quickly in the market.

11]Return on Capital Employed: Formula:

Net Profit After Tax Return on capital

employed = Capital employed *100

YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020

NPAT
9,069.34 11,943.40 19,458.21 15,308.32
Capital employed 71,669.87 145,415.73 117,928.28 200,277.45
Return on capital
employed 12.65% 8.21% 16.50% 7.64%
 250,000.00

200,000.00

150,000.00 NPAT
Capital employed
100,000.00 Return on capital employed

50,000.00

0.00
2016 -2017 2017 -2018 2018 -2019 2019 -2020

Comments:

12]The return on capital employed displays the bond between investment and
revenue. Its objective is calculating the profitability that is whole the sum
total money made readily available by the proprietor & lenders. The
return on capital employed of Rs.7.64 point that total substitution of Rs. 7.64
is attained on a money used of Rs.100. This volume that is specific of. 7.64 is
easily available to cope with interest, tax,& appropriation.
13]The return on money used is show pattern that is mixed i.e. it reduce in 2017
2018, then simply increase in 2018 2019 and ultimately decreased in 2019
2020.In 2018 2019 it is top that's 16.50 %. This shows an profitability that is
extremely high every rupee of buy & posseses an excellent scope to
entice great deal of new investment.

14]Earning Per Share:

Formula:
Net Profit After Tax – Preference Dividend
Earning per share = Number of equity share

2016-2017 2017 -2018 2018 -2019 2019 -2020

YEAR
9,06934 11,943,40.00 19,458,29.00 15,309,32.00
NPAT
 No.of equity 13,935.08 13,935.08 14,536.49 15,737.98
share
Earning per 65.08 85.71 133.86 97.28
share

16,000.00
14,000.00
12,000.00
10,000.00
8,000.00
6,000.00
4,000.00
No.of equity share
2,000.00
11,943,40.00

19,458,29.00

15,309,32.00
Earning per share
906,934

0.00

2016- 2017 - 2018 - 2019 -

2017 2018 2019 2020

Comments:

15]Receiving per share is estimated to discover down profitability that is general

of business. Earnings per share belongs to the earning in the organization
whether or perhaps not dividends are declared.
16]The receiving per share is 97.28 signifies shareholder gets Rs.972 for every
share of Rs. 10/. Placed simply the shareholder attained Rs. 97.28 per share.
17]
18] The income that is total tax for the company is growing in most years except
2019 2020. Consequently the investors producing per share is elevated
constantly from 2016 2017 to 2018 2019 by 65.08 133.86% and decrease in
2019 2020 to 97.28%.This shows it's constant cash appreciation per unit
share for consecutive 36 months aswell as capital depreciation per unit share
within the last 12 months. All of these evaluation shows the getting per
Dividend and share per share is growing quickly. It is helpful to investor that
is prospective the shareholders to commit the money in this company that is
particular.

19]Dividend Payout Ratio:

Formula:
Dividend per share
Dividend Payout ratio = Earning per share * 100
YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020
Dividend per 10.00 10.33 11.22 12.05
share
Earning per 65.08 85.71 133.86 97.28
share
Dividend
15.36% 12.05% 8.38% 12.38%
payout ratio

160

140

120

100

80

60

40

20
2016 -2017 2017 -2018 2018 -2019 2019 -2020
0

Comments:
 20]Cost of Goods Sold Ratio:

Formula:
Cost Of Goods Sold
Cost of goods sold Ratio = Net sales * 100

YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020

COGS 62,532.31 86,259.6 103,719.5 116,200.8
Net sales 80,773.79 111,699.03 133,805.78 141,959.00
Cost of goods
sold ratio 77.31 77.22 77.51 81.85

160,000.00

140,000.00

120,000.00

100,000.00

80,000.00

60,000.00

40,000.00

20,000.00
2016 -2017 2017 -2018 2018 -2019 2019 -2020
0.00

Comments:

This ratio shows the speed of consumption of natural content in the system
that is operational of. Within the 2016 2017 the price label of items sold ratio
is 77.31 % year. It implies that in 2016 2017, 77.31 percent of raw product is
consumed into the system that is operational of.
 The speed of cost of items sold ratio is just about exact same which increased
in year that is final though the product sales and revenue is improved during
the very time that is same ratio shows the speed of intake of raw content in the
system of creation through the three years. In the 2016 2017 the price of
products sold ratio is 77.31 % year. It implies that in 2016 2017, 77.31 percent
of raw material is consumed in the system that is operational of.

The speed of cost of services and products sold ratio is more or less identical
which increased in year that is final although the product sales and profit is
enhanced during the very same period throughout the three years.

21]Cash Ratio:
Formula:

Cash + Bank + Marketable securities

Cash ratio = Total current liabilities

YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020

Cash + Bank +
Marketable 239.31 308.31 217.79 500.13
securities
Total 25,858.06
21,547.00 32,221.16 45,675.71
current
liabilities
Cash ratio 0.011 0.011 0.006 0.010

50000
45000
40000
35000
30000
25000
20000
15000
10000
5000
0
 Comments:

This particular ratio is called as extremely fast ratio or liquidity ratio that is
possibly complete. Year within the 2016 2017 the cash ratio is 0.011 &
stays exact same within the season 2017 2018. Well then it's paid off to 0.006
in the time 2018

-2019 & enhanced within the season 2019 2020 to 0.010.

This demonstrates the company has money that is small bank balance, &
valuable securities to fulfill some contingency.

22]Return on Proprietors Fund Ratio:

Formula:
Net Profit After Tax
Return on proprietors fund = Proprietor’s fund * 100

YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020

NPAT 9,069.34 11,943.40 19,458.29 15,309.32
Proprietors fund 49,804.26 63,967.13 81,448.60 126,372.97
Return on
proprietors fund 18.20 16.67 23.89 12.11

140,000.00

120,000.00

100,000.00

80,000.00

60,000.00

40,000.00

20,000.00

0.00
2016 -2017 2017 -2018 2018 -2019 2019 -2020
 Comments:

Return on proprietors fund exhibits the written text between investments and
earnings by proprietors within the company. In the year that is entire 2017 the
go back on proprietors investment is 18.20 % it shows sites return of Rs. 18.20
around is obtained on the rs that are each. hundred of money added by the
owners.

23]Operating Profit Ratio:

Formula:
Operating profit
Operating profit ratio = Net sales *100
YEAR 2016 -2017 2017 -2018 2018 -2019 2019 -2020
NPAT 14,458.74 20,405.91 22,432.52 24,152.39
Proprietors fund 80,877.79 111,699.03 133,805.78 141,959
Return on
proprietors fund 17.87 18.26 16.76 17.04

160,000.00
140,000.00
120,000.00
100,000.00
80,000.00
60,000.00
40,000.00
20,000.00
0.00

2016 -20172017 -20182018 -20192019 -2020

Comments:

Operating profit ratio exhibits the connection involving the sales and running
revenue. The operating earnings is equal to earnings which can be gross all
operating costs or even sales less cost of items provided and operating
expenses.
The operating earnings ratio of 17.04 % suggests that typical operating margin
of Rs.17 is received on sale of Rs. hundred. This sort of number of Rs.
seventeen is available for fulfilling operating that is non. Within the other
Terms profits that are operating 17.04means that 17.04 percent of total income
continues to be as operating profit after seminar throughout the operating
expenses.
The running profits ratio is continues to be just about identical through the last
four years. It shows the company has effectiveness that is excellent managing
all its operations of creation, , buy inventory,
CHAPTER – VI FINDINGS AND SUGGESTIONS
& CONCLUSIONS

Findings
1. The current ratio indicates non fluctuating pattern as 1.14, 1.16, 1.38 along with
1.23 during 2016, 2017, 2018and 2019.
2. The fast ratio is in non fluctuating trend through the entire period 2016 - twenty
resulting as 0.67, 0.75, 0.69, 0.78.The Company thinks in higher earnings and
liquidity position that is minimal.
3. The proprietary ratio has shown a non fluctuating direction. The ratio that is
proprietary low in contrast to the last 12 months.
4. The stock operating capital ratio decreased from 3.21 to 1.39 in the year that is
entire - twenty.

5. The capital gearing ratio is reduced form 2016 2019 (0.16, 0.15 also 0.82) and
also enhanced in 2020 to 0.85.
6. The debt equity ratio increased from 0.44 0.59 in the growing season 2016 20.

7. The gross revenue ratio is in fluctuation way. It decreased within the year that is
present contrast to the last season from 22.4 per cent to 18.14 %.
8. The net earnings ratio is reduced in the present 12 months in contrast to the
prior season from 14.54 % to 10.78 %.
9. The ratio that is working enhanced in today's 12 months contrary to the last
season from 81.8 percent to 83.28 %.
10. The stock return ratio is reduced in the year that is present comparison to the
previous season from 4.20 - 3.73.
11. The return on capital employed is enhanced in the entire year 2016 also
2018while it decreased in the entire year 2017 and 2019.
12. The receiving per share is optimum in the year that is entire 2019 and
minimum into the season 2016 2017.
13. Dividend payout ratio is optimum in the year that is entire 2017 as well as
minimum into the 2018 2019.

14. Cost of products sold reveals a non fluctuating design into the period 2016
2019 and enhanced in the season 2019 2020.
15. The money ratio reveals a non fluctuating design in the year that is entire,
2017and 2019 but decreased in the season 2018.
16. Return on proprietorship fund is maximum within the whole year 2018 2019
and minimum within the season 2019 2020.
17. The operating earnings ratio shows design that is virtually similar all the years
though it's optimum in the year 2017 2018 and minimum in the whole year 2018
2019.
SUGGESTION :

1. 1. Liquidity defines the capability of the issue to fulfill its obligations

which can be current these have due. The organization ought to boost its
liquidity position.
2. 2. Airers4you will generate the security between liquidity and also
solvency component on the company.
3.
4. Year 3. The earnings ratio is decreased in that is current so airers4you
must be aware of this because profit making is definitely the key goal o
each business.
5. 4. The price of products offered is significant in each it 12 months so
airers4you must do initiatives to manage.
6.
7. The position that is long-term is financial of organization is
particularly excellent though it will spend some focus on temporary
solvency of the company.
 Conclusion:

The business 's general destination are at a accepted place that is really great. Enough profit in
past 4 years is achieved by the organization. The run that is part that is long of organization is
actually healthier. Minimal liquidity is maintained by the ongoing company to accomplish the
profits that are excessive. Year the corporation distributes dividends each to its share holders.
The ability on the company decreased in the very last season because of keeping the liquidity
that is comparatively high. The total working capital for the organization is maximum within the
previous year shows the liquidity that is greatest.
 Bibliography

REFERENCE BOOKS –

 FINANCIAL MANAGEMENT
 Theory, Concepts & problems
 R.P.RUSTAGI
 FINANCIAL MANAGEMENT By- M.R. Agrawal
ANAUAL REPORTS OF RELIANCE INDUSTRIES LIMITED

 2016 -2017
 2017 -2018
 2018 -2019
 2019 -2020
WEBSITES -

 www.ril.com
 www.moneycontrol.com