finance presentation ratios suzuki

Ratio Analysis

Project of Financial Management

Ration Analysis of Suzuki and Honda Motors (2010-2011)

Submitted to: Mr. Imad ud DinSubmitted by: Muhammad Ammar HassanRoll No: L-11389

Muhammad Umair Mukhtar L-11388

National University of Modern Languages (Lahore Campus) 1

Ratio Analysis

ACKNOWLEGDEMENT

In the name of Allah, Most Gracious, Most Merciful Praise be to Allah, the Cherisher and Sustainer of the worlds; Most Gracious, Most Merciful; Master of the Day of Judgment. The do we worship, and The aid we seek. The way of those on whom Thou hast bestowed Thy Grace, those whose (portion) is not wrath, and who go not astray.

(Ameen)

We heartily thankful to our teacher Mr. IMAD UD DIN whose encouragement, guidance and support enabled us to develop the subject Financial Management. With his dedicated lectures we were able to practically understand and apply what we have learned in the classes.

TABLE OF CONTENTS

Sr. Contents Page #

1 Introduction

2 Executive Summary

3 SWOT Analysis


Ratio Analysis

4 Horizontal Analysis (2010 – 2011)

5 Calculation of Ratio (2010 – 2011)

6 Ratios Analysis

7 Ratio Comparison of both Companies

8 Conclusion

9 Recommendations

10 References


Ratio Analysis

AUTOMOBILE INDUSTRY

The auto market is one of the largest segments in world trade. The annual size of automotive

export trade in the world has grown to a massive level of over US$ 600 billion, which accounts

for about 10 per cent of the world export. Changing models, improving fuel efficiency, cutting

costs and enhancing user comfort without compromising quality are the most important

challenges of the auto industry in a fast globalizing world. Hence there is a need for exploring

the industrial complementarities in the region for better quality, favourable costs, fuel

efficiency and attractive designs. Therefore, the requirement of information exchange in the

region is much more pronounced now than ever before for keeping the auto industry afloat and

competitive.

Pakistan Overview

Since its independence in 1947, Pakistan has been able to transform itself to a large extent,

from a completely agrarian economy to a fairly developed techno-industrial base. Besides

textiles, Pakistan’s exports are largely manufactured items such as consumer durables and

engineering products. However, it is also a fact that Pakistan has not been able to realize its

potential due to internal and external compulsions and thus it lags behind many developing

countries of the world. The following economic indicators constitute the tell-tale of Pakistan’s

development performance:


Ratio Analysis

Automobile Industry of Pakistan

The existing population of automotive vehicles in Pakistan is 3.9 million. The annual demand is

estimated at 300,000, two thirds of which is being met from local sources and imports and the

remaining one third is left unmet. The market value of automotive vehicles in dollar terms is

estimated at more than 1 billion, out of which import constitutes around US$ 200 million. The after

market of auto parts is estimated at US$ 500 million, imports and local production taken together.

Production figures of automobiles are given in the following tables:

Pakistan’s strength of production elements lies in its vast reservoir of land, labour and even capital.

But technology and purchasing power of the consumers are its major weaknesses. Technology

requirements are being met by joint ventures and technology tie-ups with foreign players in

automotive sector. Japanese, Korean and European entrepreneurs have invested almost US$ 1.5

billion in Pakistan’s automotive sector. The local investment in the automotive sector is

approximately US$ 1 billion.


Ratio Analysis

The GroupAtlas Honda Limited is a joint venture between the Atlas Group and Honda Motor Co., Japan.

The foundation of the Atlas Group was laid in 1962 with the establishment of Shirazi

Investments (Pvt) Limited with a capital of half a million rupees and three men doing business in

trading shares and real estate. The growth of the Atlas Group is the result of its focus on good

corporate governance. Today Atlas is a diversified group dealing in engineering, financial

services and trading. It consists of seven public limited companies out of which six are quoted on

the Stock Exchanges in Pakistan, and five private limited companies. Atlas shareholders equity

now stands over 25 billion rupees; assets have increased to over 60 billion rupees; personnel

strength is over 7000 and annual sales have crossed 60 billion rupees. The Group paid taxes of

Rs. 15 billion over 2% of the total government revenues.

All this progress is due to the Group's reliance on the intellectual capital, dedicated efforts and

team spirit of all the stakeholders. Every member is striving for excellence and taking pride in

the Group's motto:

Vision

Market leader in the motorcycle industry, emerging as a globally competitive centre of production and exports.

MissionA dynamic, profitable and growth oriented company through market leadership, maximizing export and excellence in quality and service; to ensure attractive returns to equity holders; reward employees according to their ability and performance; to foster a network of researchers and engineers ensuing unique contributions to the development of the industry; customer satisfaction and protection of the environment by producing emission friendly green products and to remain a good corporate citizen fulfilling its social responsibilities in all respects.

Our Slogan


Ratio Analysis

For Honda to remain Honda, and for everyone to realize their aspirations, we must believe in

"The Power of Dreams"

SWOT

STRENGHTS WEAKNESSES OPPORTUNITIES THREAT

Strengths: Qualified and well trained staff

Biggest sale network

Best production plant in the world

Financial Strong

Biggest market share

People Trusted Products

High Quality Products

ISO Certified

Resale value

Customer Care

Customized products

Brand Image

Availability of Spare parts

Best delivery system (Transportations)

Weaknesses

High Price of Products


Ratio Analysis

Political instability

Low per capita income of public

Less overhead rates of competitors

Increasing Prices of Oil

Rising inflation

Opportunities

Industry expansion

Technology upgrading

Strong Position

Market Integration opening up

Opportunity growing in other countries

Newly developed Areas/Markets (e.g. Gawader)

Favorable govt. policies

Big Market

Economy is expanding

Threats

Chinese cheaper products challenges

Free Trade & WTO

Strong competition from competitors in near future

Instability of Government

High rate of Taxation

INTRODUCTION


Ratio Analysis

Suzuki

It is third selling brand in Pakistan and it also targets the villagers. Its image is also approximately

same as Yamaha in the mind of people and it also targets the village areas.

Pak Suzuki Motors Company Ltd.Is a company assembling and distributing Suzuki Japan's cars in Pakistan. Currently they are one of the most successful motor companies in Pakistan.

The firm was founded in 1983 as a joint venture between PAK and Suzuki, formalizing the arrangement by which AWAMI Auto Ltd. had produced the Suzuki SS80 from 1982. Suzuki originally owned 25% of the stock, and has gradually increased their holding; they now own 73.09%. The company now assembles a wide range of Suzuki vehicles and aims to produce 150,000 vehicles per year. (2005 production was 100,000)

Our Vision

To be Excellent All Around

Our Mission

To provide automobile of international quality at competitive price

These are Mission and Vision Statement of Pak Suzuki, and they always try to improve skills of

employees by imparting training and inculcating in them a sense of participation.

· To achieve maximum indigenization and promote the automobile vending industry.

To contribute to Pakistani society through development of industry in general and automobile industry in particular.

Statement of Ethics and Business Practices

Here are the code of ethics and Business Practice of Pak Suzuki Motors Company,

1. Pak Suzuki insists on integrity and honesty of its employees in doing business. Any


Ratio Analysis

unfair or corrupt practices to solicit business is fundamentally inconsistent with business codes of company

2. Pak Suzuki believes in compliance to regulatory obligation

3. Pak Suzuki believes in free and fair business practices and open competitive markets. Developing any association with competitors to distort the pricing and supply of products is contradictory to company’s business code of conduct.

4. Pak Suzuki believes in transparency in business transaction and they are to be recorded accurately and fairly in books of accounts in accordance with standard procedure.

5. Pak Suzuki expects its employees to act in company’s best interest while holding confidential information. Company expects its employees neither to solicit internal information from other nor to disclose company’s data or any other material information to any un- authorized person/body.

6. Pak Suzuki believes in individual’s respects and growth. Its employment policies do not

discriminate on basis of race, religion, gender or any other factor.

7. Pak Suzuki does not believe in political affiliation.

Corporate Strategy

Pak Suzuki is built on the idea of a responsible corporate citizenship thereby managing environmental, safety & occupational health matters as an integral part of our business. In fulfilling this responsibility Pak Suzuki adheres to the following principles:

1) We are committed to provide top quality products to the satisfaction and requirement of our customers.

2) We conduct our operations in compliance with applicable environmental, occupational health & safety laws and regulations.

3) We recognize the interrelationship between energy and the environment, and we promote the efficient use of energy throughout our system.

4) We ensure safe disposal of waste generated from our facility

5) We minimize the discharge of waste materials into the environment by utilizing responsible pollution control practices.


Ratio Analysis

6) We will continuously seek opportunities to improve our adherence to these principles.

As it is clearly mentioned in their Vision Statement that to be excellent all around, and they always operate in Environment friendly. And their Product will always be the environment friendly.

With the globalization of markets, greater foreign competition, and the reduction of entry barriers, it becomes all the more important to benchmark a company’s financial indicators on a worldwide basis. World stock markets have recently witnessed a return to fundamental financial analysis. Sound management as opposed to hype will in the long run generate shareholder value

.

SWOT Analysis

Strengths:


Ratio Analysis

Highest Market Share

Low Price Vehicles

Resale of Local Assembled Cars

Large Distribution Channels

Rising per capita income with changing demographic distribution

Highly Innovative and deep product line

Highly maintained supply chain

Well Managed and highly competitive staff

Well defined and bureaucratic organizational structure

complete understanding between Distributors

Easy availability of spare parts

Weakness:

Scarcity of raw material

Lack of coordination and linkage with Government/semi government supporting

bodies

Less focus on Looks and Design Less Technical Training Institutes

Less distribution channels in sub urban areas

Opportunities:

Increasing Demand for Cars

Efficient EFI engines

Large Market size to operate

Global spare part market

Space saving Small size CNG cylinders

Threats:

Tough Competitors like Toyota and Honda

Foreign Investment and setup production facilities

Smuggling of Auto Parts


Ratio Analysis

Heavy Taxes

Inflation Rate

Competition from cheaper imported cars Increase in Fuel Prices.

J

HORIZENTAL ANALYSIS


Ratio Analysis

Operating Results 2011 2010 2009Rupees in Thousand

Production Volume Motor Car 92529 78840 51032 Motor Cycle 20210 19618 14530 Sales Volume Motor Car 92705 79138 52011 Motor Cycle 21154 190133 14659

Capital Employed Sales Revenue 52718563 42642762 26234061Gross Profit 1869410 1003787 569299Profit Before Taxation 1365297 668015 427843Profit After Taxation 794421 211143 255219Dividend 164600 41150 41150Profit Retained 629821 169993 214069Share Capital 822999 822999 822999Reserves 13629414 13459414 13244414Share Holder Equity 15293032 14497915 14325600Current Liabilities 8008085 4752449 3325134Fixed Assets 4200317 4226582 4684671Non Current Assets 515806 710650 543430Net Current Assets 18584994 14313132 12427633

RATIO ANALYSIS OF SUZUKI MOTORS

Accounting Profit: A company net income as reported on its income statement


Ratio Analysis

Net Worth: The capital supplied by common stock holder paid in capital rational earning.

TOTAL EQUITY

Total Equity: Common stock equity + preferred stock equity

2010 14497915 2011 15293032

Analysis: Total equity in 2011 is greater then in 2011 so it shows that the company has improved its position with time.

Non Operating Assets:

The investment in subsidies for e.g. land held for future use

LIQUIDITY RATIO

Networking Capital: Current assets – current liabilities

2010 14313132 – 4752449 = 95606832011 18584994 - 8008085 = 10576909

Analysis: The ratio has showed that it has improved its position up to $ 1016226.

Current Ratio: Current asserts / current liabilities

2010 14313132 / 4752449 =3.01172011 18584994 / 8008085 =2.3207


Ratio Analysis

Analysis: The current ratio of company has showed that it has improved to 0.691 % and it’s a great gain as per industrial average so its on great gain.

Quick Acid Ratio:

Quick assets / current liabilities

2010 5565101 / 4752449 = 1.1709 2011 5662598 / 8008085 = 0.7071

Analysis: It showed that the company has lost in last year. It’s in loss in preceding years.

How to find Quick Assets

Quick assets = current assets – inventory – prepaid expenses

2010 14313132 - 8748031 = 55651012011 18584994 - 12922396 =5662598

Analysis: Quick ratio again shows the gain in quick asset ratio.

FINANCIAL LEVERAGE RATIOS

Debt to Equity Ratio: Total Debts / Total Equity

2010 4752449 / 14497915 = 0.3272011 8008085 / 15293032 = 0.5236

Analysis: Debt to equity ratio has showed that the firm has gained 0.1966% gain in this year.

Debt to Acid Test Ratio: Debt / Total Assets

2010 4752449 / 19250364 = 0.2462011 8008085 / 23301117 = 0.343


Ratio Analysis

Analysis: Here, the debt to asset ratio of the company had showed the gain in debt to Acid.

Interest Coverage Ratio: EBIT/ Interest Charge

2010 668015 / 31.61=21133.032011 1365297/ 58.18 =23466.78

Debt To Total Capital:

Debt/Total Capital

2010 4752449 / 38500728 = 0.12342011 8008085 / 30586064 = 0.2618

(Total Capital= Total Liabilities +Owner Equity - Current Liabilities)

2010) = 19250364 + 14497915 – 4752449 = 385007282011) = 23301117 + 15293032 – 8008085 = 30586064

Analysis: The debt to total capital ratio had showed increased that showed increase in liabilities.

PROFITABILITY RATIOS

G.P Margin: G.P/ Net Sales (100)

2010 1003787 / 42642762 (100) =2.35 2011 1869410 / 52718563 (100) =3.546

Analysis: This ratio showed increased in gross profit and hence in the company’s revenue

Net Profit Margin: Net Profit/Net Sales (100)

2010 211143 / 42642762 (100) = 0.4952011 794421 / 52718563 (100) = 1.5069


Ratio Analysis

Analysis: This ratio has showed high increase in net profit margin by 1.0119 and it’s a great gain as shown by above ratio.

Return On Total Assets:

Net Income / Total Assets

2010 211143 / 19250364 = 0.01092011 794421 / 23301117 = 0.03409

Analysis: Return on capital ratio had showed that it has increased directly indicates the increase in Net income

Return On Investment:

Income After Tax/Total Assets

2010 211143 / 19250364 = 0.01092011 794421 / 23301117 = 0.0340

Analysis: This shows increase in EAT.

Return On Equity: Net Profit After Tax/ Share Holder Equity2010 213465/

ACTIVITY RATIO

AC/R TURNOVER: Net Credit Sales/ Avg Account Receivable

2010 42642762 / 672616 = 63.3992011 52718563 / 952405 = 55.35

Analysis: This ratio shows that they are collecting early AC/R as compared to last year

Avg Collection Period: Days In Year / Account Receivable Turn Over

2010 365 / 63.399 = 5.762011 365 / 55.35 = 6.59


Ratio Analysis

Analysis: shows their collection period increase this year

Inventory Turnover: C.G.S/ Avg Inventory

2010 4163875 / 8748031= 0.47592011 50849153 / 12922396 = 3.934

Analysis: This ratio has showed a great gain so is the very great increase in Cost of goods sold Avg Age Of Inventory:

Days In Year/ Inventory Turnover

2010 365 / 0.4759 = 766.962011 365 / 3.934 = 92.780

Analysis: Average age of inventory had showed increase in inventory turnover.

Operating Cycle:

Avg Collection Period +Avg Age Of Inventory

2010 5.76 + 766.96 = 772.722011 6.59 + 92.780 = 99.37

Analysis: This shows that average period decrease and improve as compared to last year

Total Assets Turnover: Net Sales/ Avg Assets

2010 42642762 / 19250364 = 2.21512011 52718563 / 23301117 = 2.2624

Analysis: The total turnover ratio is almost the same remained almost the ame. So there is no great change but slightly had increased

RATIO ANALYSIS OF HONDA MOTORS


Ratio Analysis

Accounting Profit:

A company net income as reported on its income statement

Net Worth:

The capital supplied by common stock holder paid in capital rational earning.

TOTAL EQUITY

Total Equity: Common Stock Equity + Preferred Stock Equity

2010 20000002011 2000000

Analysis: The total liquidity ratio has remained constant in both the years

Non Operating Assets:

The investment in subsidies for e.g. land held for future use

LIQUIDITY RATIO

Networking Capital: Current assets – current liabilities

2010 54344632011 4909807

Analysis: This ratio showed increase in liabilities as per result.

Current Ratio: Current Assets / Current Liabilities


Ratio Analysis

2010 5434463 / 5636805 =0.964103 2011 4909807 / 8479567 =0.579016

Analysis: The current ratio of the company had showed far decrease so the company is in loss

Quick Acid Ratio:

Quick Assets / Current Liabilities

2010 5313095 / 5636805=0.942572 2011 4803768 / 8479567=0.566511

Analysis: This showed decrease in quick asset so as increase in liabilities

Quick Assets = Current Assets – Inventory – Prepaid Expenses

2010 5434463 – 121368 =53130952011 4909807 – 106039 =4803768

Analysis: This also shows the decreasing trend in 2011 when comparing with 2010

FINANCIAL LEVERAGE RATIOS

Debt To Equity Ratio: Total Debts / Total Equity

2010 8945783 / 2000000 =4.4728922011 10573427 / 2000000 =5.286714

Analysis: This shows increase in total debts hence showed the company in loss as the value of debts increases

Debt To Acid Test Ratio: Debt / Total Assets

2010 8945783 / 5434463 = 1.6461212011 10573427 / 4909807 =2.153532


Ratio Analysis

Analysis: The acid test ratio of this company had showed increase in DebtInterest Coverage Ratio:

EBIT/ Interest Charge

2010 532852 / 455128 =1.1707742011 291882 / 152255 =1.91706

Analysis: This shows slight increase in Earnings before interest and taxes.

Debt To Total Capital:

Debt/Total Capital

2010 8945783 / 9612450 =0.9306452011 10573427 / 12156760 =0.869757

Analysis: This shows increase in the total capital while comparing it with Debt

(Total Capital= Total Liabilities +Owner Equity - Current Liabilities)

PROFITABILITY RATIOS

G.P Margin:

G.P/ Net Sales (100)

2010 239545 / 15854142 =0.0151092011 199310 / 15854142 =0.012571

Analysis: This shows great loss as the Gross profit margin is less as far as last year is concerned

Net Profit Margin:

Net Profit/Net Sales (100)

2010 852200 / 15854142 =0.0537532011 298452 / 15854142 =0.018825

Analysis: The net profit margin had showed decrease in this year’s net income


Ratio Analysis

Return on Total Assets: Net Income /Avg Total Assets

2010 852200 / 5434463 =0.1568142011 298452 / 4909807 =0.060787

Analysis: Return to capital ratio has showed increase in average total asset

Return On Investment:

Income After Tax / Total Assets

2010 852200 / 5434463 =0.1568142011 298452 / 4909807 =0.060787

Analysis: As per in last ratios , this shows the same trend as before hence income after tax is has decreased

Return On Equity:

Net Profit After Tax/ Share Holder Equity

2010 852200 / 2000000 = 0.42612011 298452 / 2000000 =0.149226

Analysis: Return to capital has showed high decrease as net profit after taxes has decreased

ACTIVITY RATIO

AC/R Turnover:

Net Credit Sales/ Avg Account Receivable

2010 15854142 / 978745 =16.19844


Ratio Analysis

2011 22026109 / 1245786 = 17.68049

Analysis: It showed increase in the Net capital sales

Avg Collection Period: Days In Year / Account Receivable Turn Over

2010 365 / 16.19844=22.533032011 365 /17.68049= 20.64422

Analysis: This showed a great decrease in account receivable.

Account Receivable Turn Over:

Net credit Sales / Account Receivable

2010 15854142 / 978745 = 16.198442011 22026109 / 1245786 =17.68049

Analysis: This shows the increase in net credit sales , inverse of the past trendInventory Turnover: C.G.S/ Avg Inventory

2010 16093678 / 121368 = 132.60232011 21826799 / 106039 =205.8375

Analysis: This shows increase in the Cost of goods sold so as decrease in average inventory

Avg Age Of Inventory:

Days In Year/ Inventory Turnover

2010 365 / 132.6023 =2.7525922011 365 /205.8375 =1.773243


Ratio Analysis

Analysis: This showed increase in Inventory turnover hence is the time period decreased

Operating Cycle: Avg Collection Period +Avg Age Of Inventory

2010 22.53303 + 2.752592=25.285622 2011 20.64422 +1.773243= 22.417463

Analysis: Operating cycle has showed again the decrease in the 2011

Total Assets Turnover: Net Sales/ Avg Assets

2010 15854142 / 5434463 =2.9173342011 22026109 / 4909807 =4.486146

Analysis: This showed great increase in net sales so as increase in total asset turnover

RATIO ANALYSIS OF BOTH COMAPNIES


Ratio Analysis

Total Equity 2010 2011Suzuki Motors

14497915

15293032

Honda Motors 2000000 2000000

Analysis: This ratio showed that Honda is in the same trend however Suzuki has increased its total equity.

Networking Capital 2010 2011Suzuki Motors

9560683

10576909

Honda Motors

5434463 4909807

Analysis: The networking has showed the increasing trend of Suzuki from 2010 to 2011 however, Honda motors have showed the decreasing trend.

Current Ratio 2010 2011Suzuki Motors 3.0117 2.3207Honda Motors

0.964103

0.579016

Analysis: The analysis of ratio has showed that Suzuki Motors has decreased so as of Honda’s

Quick Asset Ratio 2010 2011Suzuki Motors 1.1709 0.7071Honda Motors

0.942572

0.566511

Analysis: Both the company’s showed the decreasing trend in both the companies

Debt to Equity Ratio 2010 2011


Ratio Analysis

Suzuki Motors 0.327 0.5236Honda Motors

4.472892

5.286714

Analysis: this analysis shows that however both the companies has increased its debt to equity ratio but the analysis showed that Honda is greater than Suzuki

Debt to Acid test Ratio 2010 2011Suzuki Motors 0.246 0.343Honda Motors

1.646121

2.153532

Analysis: Here, acid test ratio shows the increase in trends but again Honda is in profit while comparing it with that of Honda’s.

Interest Coverage Ratio 2010 2011Suzuki Motors

21133.03

23466.78

Honda Motors

1.170774 1.91706

Analysis: Interest coverage ratio of Suzuki has showed increases so as of Honda’s. However, while comparing both we see that Suzuki is rather much greater then Honda’s.

Debt to Total Capital Ratio 2010 2011Suzuki Motors 0.1234 0.2618Honda Motors

0.930645

0.869757

Analysis: The debt to equity ratio of Suzuki rather of increasing still less then that of Honda.

G.P Margin 2010 2011


Ratio Analysis

Suzuki Motors 2.35 3.546Honda Motors

0.015109

0.012571

Analysis: Gross profit of Suzuki as far as past record is concern has shown higher degree from Honda

Net profit Margin 2010 2011Suzuki Motors 0.495 1.5069Honda Motors

0.053753

0.018825

Analysis: While comparing the Honda and Suzuki the trend shows that Net profit margin of fluctuates with time

Return on Total Assets 2010 2011Suzuki Motors 0.0109 0.03409Honda Motors

0.156814

0.060787

Analysis: Return to capital of the Honda has always been higher then Suzuki so the Assets has shown to be greater of value

Return on Equity 2010 2011Suzuki Motors

Honda Motors0.426

10.14922

6

Analysis:


Ratio Analysis

AR Turnover Ratio 2010 2011Suzuki Motors 63.399 55.35Honda Motors

16.19844 17.68049

Analysis: shows that account receivable of Suzuki has improved as compared to Honda

Average Collection Period 2010 2011Suzuki Motors 5.76 6.59Honda Motors

22.53303 20.64422

Analysis: this ratio shows that average collection period decrease for Honda but increase for Suzuki

Inventory Turnover 2010 2011Suzuki Motors 0.4759 3.934Honda Motors

132.6023

205.8375

Analysis: Honda has shown a greater inventory turnover ratio while Honda is far less then Suzuki.

Avg Age of Inventory 2010 2011Suzuki Motors 766.96 92.78Honda Motors

2.752592

1.773243

Analysis: The Suzuki shows decreasing trend from past however it is greater than Honda


Ratio Analysis

Operating Cycle 2010 2011Suzuki Motors 772.72 99.37Honda Motors

25.285622

22.417463

Analysis: This ratio shows that it is favorable for both companies

Total Assets TurnoverComparison 2010 2011Suzuki Motors 2.2151 2.2624Honda Motors

2.917334

4.486146

Analysis: Total asset turnover of Honda has increased so as of Suzuki’s but Honda has always been greater so the value of Assets of Honda is greater.


Ratio Analysis

CONCLUSION

We have studied the financial statements of both HONDA and SUZUKI MOTORS and after analyzing the financial statements of both companies we conclude that the condition of Suzuki motors is more better then Honda because Suzuki motors is more profit conditions as compare to Honda because the financial situations of Honda is not better then Suzuki if the debtors of Suzuki demands their debts from company then the Suzuki is in this situation that it can easily pay to their debtors by selling their assets but on the other hand Honda is not in such position because their liabilities are more than their assets. The financial statement of Suzuki shows that their values of assets are more than their liabilities and their profit and comprehensive income for year 2011 is greater than 2010, so by studying and analyzing financial statement of Suzuki motors we conclude that their financial position in market is better than Honda.

RECOMMENDATION

We have observed that Honda motors have to more focus on their weakness and by using their strengths they should gain more opportunities to face their threats. They should raise capital for further investment to be good competitor for Suzuki motors as well as other companies.

REFERENCESwww.suzukimotors.pk.comwww.hondamotors.pk.comwww.wikipedia.comwww.google.com


http://www.google.com/

http://www.wikipedia.com/

http://www.hondamotors.pk.com/

http://www.suzukimotors.pk.com/

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