BARRACKPORE RASTRAGURU SURENDRANATH COLLEGE

(AFFILIATED TO WEST BENGAL STATE UNIVERSITY)

PROJECT WORK ON
A STUDY OF LIQUIDITY, SOLVENCY & PROFITABILITY
POSITION OF
(Submitted in partial fulfillment of B.COM degree in Accounting & Finance in
Barrackpore Rastraguru Surendranath College)

PROJECT GUIDE:

DR. KALLOL SAHA, ASSISTANT PROFESSOR, DEPT. OF COMMERCE

SUBMITTED BY:

NAME : SRIJATO CHAKRABORTY

CLASS : B.COM (Hons)
SEMESTER : VI
REGISTRATION NO. : 1032111401233
ROLL NO. : 6241107
ROLL No. (WBSU) :07061
PAPER :

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 SUPERVISOR’S CERTIFICATE

This is to certify that SRIJATO CHAKRABORTY a student of B.Com in Accounting &

Finance of Barrackpore Rastraguru Surendranath College under the West Bengal State
University, Barasat has worked under my supervision and guidance for her project work and
prepared a project report with the title “A Brief Study of the Liquidity, Solvency &
Profitability position of AJONTA PHARMA” through Ratio Analysis her work is genuine
and original to the best of my knowledge.

Signature

NAME: DR. KALLOL SAHA

DESIGNATION: Assistant Professor, Dept. of Commerce

DATE:

NAME OF THE COLLEGE: Barrackpore Rastraguru Surendranath College

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 STUDENT’S DECLARATION

I hereby declare that the project work with the title “A Study of the Liquidity, Solvency &
Profitability position of AJONTA PHARMA. through Ratio Analysis” submitted by me for
the partial fulfillment of degree of B.Com in Accounts & Finance under the West Bengal
State University, Barasat is my original work and has not been submitted earlier to any
other University / Institution for the fulfillment of the requirement for any course of study.

I also declare that no chapter of this manuscript in whole or part has been in corporation in
this report from any earlier work done by other or by me. However, extracts of any
literature which has been used for this report has been duly acknowledged providing details
of such literature in references.

Signature

NAME: SRIJATA CHAKRABORTY

ROLL NO.: 6241107 07061

REGISTRATION NO.: 1032111401233

ADDRESS: Barrackpore

DATE:

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 INDEX

TOPIC PAGE

Acknowledgement

Executive Summary

Introduction

-Objective Of The Study

-Research Methodology

-Conceptual Framework Of Ratio Analysis

Company Profile

-Snapshot Of Balance Sheet

Calculation & Interpretation

Analysis

Conclusion

Scope For Further Study

Limitations

Bibliography

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 ACKNOWLEDGEMENT

I am extremely thankful to our Principal Prof (Dr.) Monojit Ray for providing
us with the necessary infrastructure. I cordially thank the Department of
Commerce of our college and The WBSU for including this project work in our
syllabus.

I express my sincere gratitude to my Project Guide, Dr. Kallol Saha, Assistant

Professor, Dept of Commerce, who has shown me the path to undertake this
project and finally give a meaningful shape to it. I would like to thank my entire
group of mentors without whom I would not have been able to carry out this
work.

Thank you all.

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 EXECUTIVE SUMMARY
This project has been carried out in partial fulfillment of B.Com degree in Accounting &
Finance in Barrackpore Rastraguru Surendranath College.

Each and every company carries out its business with the primary objective of earning profits.
Generally, at the end of the financial year the Income Statement and Balance Sheet are prepared
for the purpose of ascertaining the profitability of the organization. However, other than
profitability, the solvency and the liquidity of the company is also an important factor.
Therefore, ratio analysis is considered to be an important tool in order to find out and interpret
the financial condition of a company.

In my project I have tried to understand and analyze the financial condition of AJONTA

PHARMA. by calculating several ratios for a period of three consecutive years. Based on the
results of important ratios for the three years, I have tried to understand and put remarks about

the financial conclusion of AJONTA PHARMA.

I hope that my evaluation and conclusion will provide valuable information to all interested
parties. I invite constructive criticism from my teachers and other users for the future
improvement of such projects which I may have to carry out from time to time.

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 INTRODUCTION

OBJECTIVE OF THE STUDY:

This project titled “A Study of the Liquidity, Solvency & Profitability position of
AJONTA PHARMA. through Ratio Analysis” has been prepared with the following
objectives –

1. To calculate the essential ratios to find out the Liquidity, Solvency &
Profitability position of AJONTA PHARMA.
2. To comment on the value of the calculated ratios and interpret their significance.
3. To see the trend of the different ratios for five consecutive years.

RESEARCH METHODOLOGY

This project has been carried out by using secondary data only.

The secondary data has been collected from the websites the company under study.

The main data for my project are the annual financial reports of AJONTA PHARMA. for
the years 2021-22, 2022-23 & 2023-24. The Income Statement & Balance Sheet are the
main sources of the financial figures for calculation of the Ratios.

We can use several tools to evaluate the performance of a company, but I have used one of
the most valuable tools. This tool is “financial ratios”. Ratios are an analyst’s
microscope; they allow us get a better view of the firm’s financial health than just
looking at the raw financial statements. Ratios are useful both to internal and external
analysts of the firm. For internal purposes: ratios can be useful in planning for the future,
setting goals, and evaluating the performance of managers. External analysts use ratios to
decide whether to grant credit, to monitor financial performance, to forecast financial
performance, and to decide whether to invest in the company.

CONCEPTUAL FRAMEWORK OF RATIO ANALYSIS

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MEANING OF RATIO

A Ratio is a relationship between two or more numbers, values or items expressed in

mathematical items. The comparable variables in the ratio must be of same category and be
expressed in the same unit of measurement.

MEANING OF ACCOUNTING RATIO

An Accounting Ratio is the mathematical expression of relationship between two accounting

data. It is also known as Financial Ratio. It is calculated for exhibiting a meaningful and useful
relationship between the accounting variables derived from the financial statements.

MEANING OF RATIO ANALYSIS

Ratio Analysis is the process of comparative analysis and interpretation of accounting ratios.
This analysis identifies the financial strength, weakness and growth potentiality of an enterprise.
Thus it is a technique of interpretation of financial statements with the help of accounting ratios
derived from such statements.

OBJECTIVES OF RATIO ANALYSIS

Following are the objectives of ratio analysis:

(a) Simplify accounting information.

(b) Determine liquidity or short-term solvency and long-term solvency. Short-term solvency
is the ability of the enterprise to meet its short-term financial obligations. Whereas, long-
term solvency is the ability of the enterprise to pay its long-term liabilities of the
business.
(c) Assess the operating efficiency of the business.
(d) Analyze the profitability of the business.
(e) Help in comparative analysis, i.e., inter-firm and intra-firm comparisons.

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 CLASSIFICATION OF RATIOS
Accounting ratios may be classified in different ways. However, the most widely used
classifications are as follows:

Classification according to source of data

Balance Sheet ratios Profit & Loss account Composite/Mixed

These are ratios of two ratio ratios These are ratios
groups of balance sheet These are ratios of two or two whose numerator and
items. groups of items of Profit & denominator are derived
Loss A/c. from different sources.

1. Current Ratio 1.Gross Profit Ratio 1.Stock Turnover Ratio

Gross Profit Cost of Goods Sold
Current Assets (CA) ¿ Ã — 100 ¿
¿ Net Sales Average Stock
Current Liabilities (CL)

2.Liquid/Acid Test/Quick
2.Operating Ratio 2.Debtors-Turnover
Ratio OperatingCost Ratio
¿ Ã — 100
Sales
Liquid Assets Debtors
¿ ¿
Current / Liquid Liabilities Cost of Goods Sold Credit Sales
¿ +¿
Sales

Operating Expenses
à — 100
Sales

3.Super Quick Ratio 3.Net Profit Ratio 3.Creditors-Turnover

Ratio
Casℎ+Bank +¿ Marketable Securities Net Profit
¿ ¿ Ã — 100
Quick Liabilities Net Sales Creditors
¿
Credit Purcℎase

4.Cash Position Ratio 4.Operating Profit Ratio

4.Total Assets Turnover
Casℎ+Bank +¿ Marketable Securities Operating Profit
¿ ¿ Ã — 100
Total Assets Sales Ratio
[Operating Profit = Net Profit + Cost of Goods Sold
¿ ∨¿
Total Assets
9|Page Non Operating Expenses – Non
Operating Gain] Sales
Total Assets
5.Cash to Current 5.Preference 5.Fixed Assets Turnover
Liabilities Shareholders’ Coverage Ratio
Casℎ+Bank +¿ Marketable Securites Ratio Cost of Goods Sold
¿ ¿ ∨¿
Current Liabilities ¿ Assets
Net Profit after tax∧¿ Interest but before
Equity Dividend Turnover/ Sales
¿
Prefernce Dividend ¿ Assets
6.Cash Interval/ Cash 6.Interest Coverage Ratio 6.Capital Turnover Ratio
Defensive Interval
Net Profit (before ¿ Interest ∧¿ Tax) Cost of Goods Sold
¿ ¿
Casℎ Reservoir Interest '
¿ Sℎareℎolder s Fund
Average Projected Daily
Casℎ Expenses

7.Cash Burn Ratio 7.Return on Capital

365 daysà — Casℎ raised Employed
¿ initial investor
¿
Projected capital Net Profit before Tax
¿ ∨¿
expenditure for startup Capital Employed

Net Profit before Interest

after Tax
8.Debt Equity Ratio Capital Employed

Total External Liabilities 8.Return on

(a) '
Sℎareℎolder s Fund Shareholders’ Equity
Long −term Liabilities Net Profit
(b ) ' ¿
Sℎareℎolder s Fund '
Proprietor s Fund
Liabilities+ Preference
Sℎare Capital
(c )
Equity Sℎareℎolder s '
Fund

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 9.Capital Gearing Ratio 9.Earning Per Share
¿ Interest bearing Net Profit
¿
Securities Number of Equity
¿
Equity Sℎareℎolders Sℎares
Fund
10.Dividend Per Share
10.Proprietory Ratio
Total Dividend
' ¿
Sℎareℎolder s Fund Number of Equity
¿
Total Assets Sℎares

11.Assets- 11.Dividend Pay-out

Proprietorship Ratio Ratio
¿ Assets Dividend per Sℎare
(a ) ¿
'
Proprietor s Equity Earning per Sℎare

Current Assets
(b ) '
Proprietor s Equity
12.Price-Earning Ratio
12.Inventory-Working
Market value per sℎare
Capital Ratio ¿
Earning per sℎare
Inventory
¿
WorkingCapital

13.Current Asset to
Fixed Asset Ratio
Current Assets
¿
¿ Assets

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COMPANY PROFILE

Ajanta Pharma is a specialty pharmaceutical company

providing quality medicines across 30+ countries in the
world.
We enjoy leadership in multiple molecules and therapeutic segments through 1st to market products.

We clearly understand our customers’ needs and use cutting- edge technology to present innovative
solutions. Our business includes Branded Generics in India and Emerging Markets of Asia and Africa;
Generics in USA; and Institution Sales in Africa. Our diversified revenue stream makes this business
model scalable and sustainable.

Our determination to find answers for patient-needs motivates us to develop differentiated 1st to market
products. This smart product portfolio provides us leadership in various molecule and therapeutic
segments.

VISION, MISSION AND VALUES

Our mission is to Serve Global Healthcare needs through Empathy, Innovation and Technology .
We believe that to ensure sustained growth, we need to clearly understand our customers needs and
use cutting-edge technology to present innovative solutions with a cost-effective approach.

Be a niche player in global pharma space and to enhance value for all stakeholders. We are a
value driven company. We see Ajanta making a global impact in a way that creates value for all
stakeholders, through focus on niche products to fulfil emerging patient needs.

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 BOARD OF DIRECTORS

Mr. Mannalal Agrawal, Chairman

Mr. Madhusudan Agrawal, Vice Chairman
Mr. Yogesh Agrawal, Managing Director
Mr. Rajesh Agrawal, Joint Managing Director
Mr. Chandrakant Khetan, Non-Executive, Independent Director
Mr. K. H. Vishwanathan, Non-Executive, Independent Director
Mr. Prabhakar Dalal, Non-Executive, Independent Director
Dr. Anjana Grewal, Non-Executive, Independent Director
Mr. David Rasquinha, Non-Executive, Independent Director
Mrs. Medha Joshi, Non-Executive, Independent Director
Mr. Rajesh Dalal, Non-Executive, Independent Director
Ms. Simi Thapar, Non-Executive, Independent Director

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 SNAPSHOT OF BALANCE SHEET OF AJONTA PHARMA.
AS AT 31ST MARCH 2024
(All amounts in Rupees millions)
PARTICULARS AS AT 31ST AS AT 31ST AS AT 1ST
MARCH 2024 MARCH 2023 APRIL 2022

Sources Of Funds

Total Share Capital 25.27 25.27 17.17

Equity Share Capital 25.27 25.27 17.17
Share Application Money 5.65 0.34 0.00
Reserves 3,382.65 3,220.84 3,152.01
Networth 3,413.57 3,246.45 3,169.18
Total Liabilities 3,413.57 3,246.45 3,169.18
Mar '24 Mar '23 Mar '22
12 mths 12 mths 12 mths

Application Of Funds

Gross Block 2,309.13 2,213.88 2,113.52

Less: Accum. Depreciation 844.24 729.87 621.20
Net Block 1,464.89 1,484.01 1,492.32
Capital Work in Progress 256.45 209.47 152.86
Investments 367.14 553.26 164.85
Inventories 677.79 683.77 635.11
Sundry Debtors 1,207.67 977.63 1,043.62
Cash and Bank Balance 63.06 269.92 145.25
Total Current Assets 1,948.52 1,931.32 1,823.98
Loans and Advances 180.44 126.73 146.48
Total CA, Loans & Advances 2,128.96 2,058.05 1,970.46
Current Liabilities 746.57 1,020.17 581.19
Provisions 57.30 38.17 30.12
Total CL & Provisions 803.87 1,058.34 611.31
Net Current Assets 1,325.09 999.71 1,359.15
Total Assets 3,413.57 3,246.45 3,169.18
Contingent Liabilities 161.39 91.52 76.44
Book Value (Rs) 270.65 257.80 371.03

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 INCOME STATEMENT

Mar '24 Mar '23 Mar '22

12 mths 12 mths 12 mths

Income

Sales Turnover 3,971.12 3,411.27 3,140.64

Net Sales 3,971.12 3,411.27 3,140.64
Other Income 116.48 132.75 139.73
Stock Adjustments 22.17 21.99 56.60
Total Income 4,109.77 3,566.01 3,336.97

Expenditure

Raw Materials 1,150.34 1,093.73 943.61

Power & Fuel Cost 66.44 65.53 54.09
Employee Cost 834.16 720.41 585.87
Selling and Admin Expenses 4.49 5.02 4.78
Miscellaneous Expenses 818.43 849.29 718.00
Total Expenses 2,873.86 2,733.98 2,306.35
Mar '24 Mar '23 Mar '22
12 mths 12 mths 12 mths
Operating Profit 1,119.43 699.28 890.89
PBDIT 1,235.91 832.03 1,030.62
Interest 6.80 5.23 9.12
PBDT 1,229.11 826.80 1,021.50
Depreciation 132.16 126.95 120.96
Profit Before Tax 1,096.95 699.85 900.54
PBT (Post Extra-ord Items) 1,096.95 699.85 900.54
Tax 289.71 141.13 180.68
Reported Net Profit 807.24 558.72 719.86
Total Value Addition 1,723.52 1,640.25 1,362.74
Equity Dividend 642.17 89.69 82.21
Corporate Dividend Tax 0.00 0.00 0.00

Per share data (annualised)

Shares in issue (lakhs) 1,259.16 1,259.15 854.16

Earning Per Share (Rs) 64.11 44.37 84.28
Equity Dividend (%) 2,550.00 350.00 475.00
Book Value (Rs) 270.65 257.80 371.03

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CALCULATION & INTERPRETATION OF FINANCIAL POSITION OF KHADIM
INDIA LTD. THROUGH RATIO ANALYSIS:
Financial ratios are useful indicators of a firm's performance and financial situation. Financial ratios can be
used to analyze trends and to compare the firm's financials to those of other firms. Ratio analysis is the
calculation and comparison of ratios which are derived from the information in a company's financial
statements. In My study I have tried to analyze the LIQUIDITY, SOLVENCY & PROFITABILITY of
AJONTA PHARMA. for three consecutive years through some selected ratios which are considered to be
effective Indicators of financial positions of the company.

Ratios For Test Of Liquidity Or Short Term Financial Position Of A Firm:

(1) Current Ratio: It is the relationship between current assets and current liabilities. It is also known as
Working Capital Ratio. It is a measure of general liquidity and is most widely used to make analysis of the
short-term financial position or liquidity of a firm.

The standard Current ratio may differ from Industry to Industry and business to business. However, generally
most experts and well known books say that a 2:1 ratio is considered as normal. This means that for every 1
rupee of current liability there should be 2 rupee of current asset. This expresses a satisfactory liquidity of the
company.

CALCULATION OF CURRENT RATIO:

Current Assets
Current Ratio=
Current Liabilities
Components of Current Ratio:

CURRENT ASSETS CURRENT LIABILITIES

Current Investments Short term borrowings
Inventories Trade Payables
Trade Receivables Other Current Liabilities
Cash and Bank Balances Short term Provisions
Other Current Assets

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In case of AJONTA PHARMA., the company taken up for study, the Current Ratios for the four
years are:

YEAR ENDED 31ST YEAR ENDED 31ST YEAR ENDED 31ST

MARCH 2024 (Amt. in MARCH 2023 (Amt. in MARCH 2022 (Amt. in
Rupees millions) Rupees millions) Rupees millions)
Current Assets Current Assets Current Assets
Current Ratio= Current Ratio= Current Ratio=
Current Liabilities Current Liabilities Current Liabilities

1948.52 1931.32 1823.98

¿ ¿ ¿
746.57 1020.17 581.19

¿2.61 ¿1.89 ¿ 3.12

From the calculation of Current Ratios for all the four years, it is found that the current assets
are more than the current liabilities.

Thus in all the four cases, the liquidity or the short-term financial position of the company is
good.

(2) Quick Ratio: Quick ratio is a refinement of current ratio. It is the ratio of quick assets to
quick liabilities. It is widely used as indicator of firm‟s liquidity. It is a measure for
judging immediate liquidity position of a firm. As it excludes inventory from current assets,
it can more effectively measure the short term debt paying ability.

The standard Quick ratio may differ from Industry to Industry and business to business.
However, generally most experts and well known books say that a 1:1 ratio is considered as
normal. This means that each rupee of quick liabilities should be backed by quick assets of
equal value.
CALCULATION OF QUICK RATIO:
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 Quick Assets
Quick ratio=
Quick Liabilities

Current Assets −(Inventory +¿ Prepaid Expenses )

¿
Current Liabilities − Bank Overdraft
Components of Quick Ratio:

QUICK ASSETS QUICK LIABILITIES

Current Investments Short-term Borrowings
Trade Receivables Trade Payables
Cash & Bank Balances Other Current Liabilities
Other Current Assets Short-term Provisions

In case of AJONTA PHARMA., the company taken up for study, the Quick Ratios for the four years
are:

YEAR ENDED AT 31ST YEAR ENDED AT 31ST YEAR ENDED AT 31ST

MARCH 2024 (Amt. in MARCH 2023 (Amt. in MARCH 2022 (Amt. in
Rupees millions) Rupees millions) Rupees millions)

Quick Assets Quick Assets Quick Assets

Quick Ratio= Quick Ratio= Quick Ratio=
Quick Liabilities Quick Liabilities Quick Liabilities

1270.73 1247.55 1188.87

¿ ¿ ¿
746.57 1020.17 581.19
¿ 1.70 ¿ 1.22 ¿ 2.05

From the calculation of quick ratio for all the four years, it is found that where the quick
assets should have been atleast equal the quick liabilities, in reality the quick assets are infact
lower than the quick liabilities.
Thus, in all the four cases the liquidity or short-term financial position of the company is
really poor. This needs a care in the eyes of the management and necessary steps must be
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taken.
Ratios for Test of Solvency or Long Term Financial Position of a Firm

(1) Proprietary Ratio- It is the ratio of proprietary fund to total assets and is generally
expressed as percentage. It indicates how much o the total assets have been procured with
ownership fund. The proprietary ratio is taken as the indication of financial soundness of
the firm. It is the test of solvency of the firm. Therefore, a high proprietary ratio is
desirable from solvency point of view. However, a too high proprietary ratio also
indicates that the firm is conservative in using debt capital. In that case it cannot reap the
benefit of trading on equity. The standard Proprietary Ratio may differ from industry to
industry and business to business. However, generally most experts and well known
books say that a 60% to 70% of total assets should be preferably financed by proprietors
fund.
CALCULATION OF PROPRIETARY RATIO:
'
Shareholder s Fund
Proprietary Ratio=
Total Aseets

Components of Proprietary Ratio:

SHAREHOLDERS’ FUND TOTAL ASSETS

Share Capital Fixed Assets-
Reserves & Surplus (Other Equity) Tangible Assets
Intangible Assets
Capital work-in-progress
Non-Current Investments
Other Non-Current Assets
Current Assets-
Current Investments
Inventories
Trade Receivables
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 Cash & Bank Balances
Other Current Assets

In case of AJONTA PHARMA., the company taken up for study, the Proprietary ratios for the
four years are:

YEAR ENDED AT 31ST YEAR ENDED AT 31ST YEAR ENDED AT 31ST

MARCH 2024 (Amt. in MARCH 2023 (Amt. in MARCH 2022 (Amt. in
Rupees millions) Rupees millions) Rupees millions)
' ' '
Sℎareℎolder s Fund Sℎareℎolder s Fund Sℎareℎolder s Fund
Proprietary Ratio= Proprietary Ratio= Proprietary Ratio=
Total Assets Total Assets Total Assets

3438.84 3271.73 3186.35

¿ Ã — 100 ¿ Ã — 100 ¿ Ã — 100
3413.57 3246.45 3169.18

¿ 155 % ¿ 100 % ¿ 100 %

From the calculation of proprietary ratio for all the four years, it is found that the
contribution of the stakeholders’ are not upto the standard level i.e., 60% to 70% as they are
all below 60%, hence it indicates that the company is more dependent on debts for its
operation.
Ratios for Test of Profitability Financial Position of a Firm

(1)Net Profit Ratio: This ratio indicates the efficiency of management in manufacturing,
administrating, and selling the product. This ratio is of special interest to the owners as it states
how much of sales are left for them after meeting all expenses. A high net profit ratio will
enable them to withstand the hardship in adverse situation like falling selling price, increasing
raw material cost or decline in demand etc. A low net profit ratio is the danger signal for the
firm. As return to owners is poor, the firm will find it difficult to rise further for expansion. It
will, therefore, remain stagnant.
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The standard Net Profit ratio may differ from industry to industry and business to business.
However, generally most experts and well known books say that a 5% to 10% is considered as
normal.

CALCULATION OF NET PROFIT RATIO:

Net Profit
Net Profit Ratio= Ã — 100
Sales

YEAR ENDED AT 31ST YEAR ENDED YEAR ENDED AT 31ST

MARCH 2024 (Amt. in AT 31ST MARCH 2022 (Amt. in
Rupees millions) MARCH Rupees millions)
2023(Amt. in
Rupees millions)
Net Profit Net Profit Net Profit
Net Profit Ratio= Ã — 100Net Profit Ratio= Net
× Profit
100 Ratio= Ã — 100
Sales Sales Sales

807.24 558.72 719.86

¿ Ã — 100 ¿ Ã — 100 ¿ Ã — 100
3971.12 3411.27 3140.64

¿ 20.33 % ¿ 16.38 % ¿ 22.92 %

In case of AJONTA PHARMA., the company taken up for study, the Net Profit ratios for
the four years are:

From the calculation of Net Profit ratio for all the four years, the standard Net Profit ratio
must be 10% or more, but in reality it is less than 10%. Moreover, the Net Profit ratio of
2019 is lower than the previous years, which is not a good sign. Hence, necessary steps
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 must be taken.

ANALYSIS

From the above calculation of different ratios it can be said that:

 The Current Ratio of the company is good whereas the Quick Ratio is poor. Hence, the
liquidity or short-term financial position of the company is not so good.
 The Quick Ratio……
 The Proprietary Ratio of AJONTA PHARMA. indicates that the company is more dependent
on debts for its operation, where as in case of Debt-Equity Ratio, the company is
providing higher margin to the suppliers of capital. Hence, the company has a moderate
solvency position.
 The company has a positive Net Profit Ratio in all the four years, but is less than 10%.
Moreover, the Net Profit Ratio of 2019 has decreased after 2018. The Return on Total
Assets Ratio and Return on Equity Ratio both are in a moderate position.

CONCLUSION

From the above mentioned analysis and interpretation, it can be concluded that the company,
AJONTA PHARMA, does not have a good liquidity position. The solvency and profitability positions
of the company are moderate. The management should take more care and attention towards its
investments other matters so that the company can grow more in coming years with an
improvised liquidity, solvency and profitability position. There should be more and proper
utilization of company’s resources along with its assets.

SCOPE FOR FURTHER STUDY

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In this study I have carried out the analysis of the financial position through ratio analysis of a
single company. However, if time and circumstances permit, a comparative study of ratios of
close-competitor companies can be carried out. Moreover, Trend Analysis of results of ratios
can also help to predict the future financial condition of companies.

LIMITATIONS OF THE STUDY

In spite of several precautions, the study suffers from the following limitations or drawbacks:

 Non monetary aspects relating to the company and its business are not considered making
the comments and conclusions of different calculated ratios.
 In spite of precautions taken there are certain procedural and technical limitations.
 Due to lack of time, only few selected ratios have been calculated and analyzed, better
interpretation could have been made if more ratios were calculated.
 This is a self funded project. The standard and scale of the project could have been
improved if financial assistance was available.

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 BIBLIOGRAPHY

BOOKS AND JOURNALS

1. Financial Accounting – III by Dey-Dutta-Mukherjee

2. Financial Statement Analysis by Dr. Jayanta Ghosh
3. Financial Statement Analysis by Gokul Sinha
4. Financial Statement Analysis and Security Valuation by Stephen H. Penman
5. Financial Ratios And Financial Statement Analysis by Jagdish R. Raiyani
6. The Analysis And Use of Financial Statements (Book & CD Rom) by Gerald
I. White, Ashinpaul C. Sondhi, Dov Fried
7. Consolidated Financial Statements with Illustrations by Kamal Garg
8. Outlook PROFIT – Now I Know How To Analyze Financial Statements by
Outlook Publishing
9. Financial Accounting by Basu & Das
10. Financial Accounting by M Hanif & A Mukherjee

WEBSITES

1. www.moneycontrol.com

2. www.ajontapharma.com

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