my project
TRANSCRIPT
Chapter – 1
INTRODUCTION
1
Financing
Financing is a term sometimes used in discussions of financial capitalism which developed
over recent decades, in which financial leverage tended to override capital (equity) and
financial markets tended to dominate over the traditional industrial economy and agricultural
economics.Financialing is a term that describes an economic system or process that attempts
to reduce all value that is exchanged (whether tangible, intangible, future or present promises,
etc.) either into a financial instrument or a derivative of a financial instrument. The original
intent of financing is to be able to reduce any work-product or service to an exchangeable
financial instrument, like currency, and thus make it easier for people to trade these financial
instruments.Finance is an integral part of investment activity and if it is inadequate,
investment will be blocked. Firms generally depend on financial markets to finance their
investment. During 1950s, studies on corporate finance argued that under perfect financial
market setting, financial structure does not affect the investment decision of firms. In other
words, the role of financial intermediaries was ignored till the late 1960s. The neutrality of
financial factors, however, confronted with criticisms after the emergenceof theoretical and
empirical studies with results inconsistent with earlier models
Pattern
A technical chart formation used to make market predictions by following the price
movements of securities.The graphical representation on a chart of a trend in security prices.
Technical analysts identify patterns for a security and predict future price movements in part
by matching current patterns with previous patterns.
1. Introduction of financing pattern
The corporate finance pattern is of vital importance for the financial well being of
companies. Corporate finance decisions affect the various facets of the corporate management
directly or indirectly, which ultimately determine the wealth of investors. The corporate
finance decisions in private Sector affects not only the financial soundness of the concerned
2
in 1991, which marked the beginning of liberalization process in India. Post 1991. The
changing pattern in the financing is observed in reforms in the Indian economy and the private
sector in particular accompanied by investment. The steels and aluminum industries have got
the challenge to access the market for both equity and debt finance. The gradual reduction in
the interference otherwise known as increasing autonomy to them will make this task easier.
The steels and aluminum have to relook at the financial leverage they have at present and
change suitably. In this context the present study made one of the first attempts to know the
factors that affect their capital structure. In confirmation with theory more specifically,
pecking order hypothesis, the leverage is found to be negatively related to profitability, i.e. the
steels and aluminum s use the\internal accruals first for the needs of expansion. The
tangibility measured by the ratio of net fixed assets to total assets is found to be positively
related to leverage.). In that study in almost all the sample developing countries the tax rate is
found to be negatively related to leverage. The present study is one of the limited studies
based on sample of central PSUs in India. One can possibly enlarge the sample or modify the
same by taking the steels and aluminum companies listed to capture the effect of the market
on the capital. The thrust of the literature opted to move away from the traditional theories
and placed emphasis on the role of financial sector, since it is argued that changes in the
financial factors will have its influence on the allocation of capital. These studies emphasise
the relationship between finance and investment, and provide a framework for analysingthe
financing patterns and investment behaviour of corporate sector. This section aims to discuss
the relationship between financing patterns and investment in the context of financial
liberalisation to provide a theoretical background for the empirical analysis that we intend to
carry out to study the determinants
Financing patterns across firm types
While the section above focused on the time series behavior of firm financing ratios, this
section explores differences across firm characteristics. In particular, we examine differences
in financing patterns by firm size, sector, age, ownership type, and export orientation. These
differences by analyzing descriptive statistics (means and medians) across firm and by
conducting univariate tests to determine whether these differences are statistically significant.
Second, following the literature on capital structure, we perform regression analysis to
3
understand the determinants of firm financing ratios in India and to investigate whether there
are differences in the factors driving firm financing ratios across firm size and other firm .
Debt financing can alleviate conflicts between equity holders and managers, it can at the
same time create agency problems between equity holders and debt holders. Debt contracts
are such that if an investment yields returns above the nominal value of the debt, equity
holders capture the surplus, but if the investment fails, because of limited liability, debt
holders bear the consequences.
2. Capital Structure –
For any organization financial strategy is of utmost importance. By financial strategy, one
means the
Broad corporate financial decisions that are made by the corporate’ management committee
or above – i.e.at the level of Board. These are not specific decisions, such as the decision to
undertake a project or not. It might even involve decision regarding the rate of interest at
which funds need to be borrowed. Broadly, three kinds of policies come under the purview of
financial strategy. : It represents the total long-term investment in a business firm. It includes
funds raised through ordinary and preference shares, bonds, debentures, term loans from
financial institutions, etc. Any earned revenue and capital surpluses are includedThey are
capital structure policy, dividend policy and capital budgeting policy. All three policies are
important in their own way and are interlinked. Ignoring any of them in corporate financing
decision-making is very difficult. Capital structure policy is normally concerned about:
The proportion of debt and equity to finance the company’s operations
How does the long term to short-term debt mix look like?
In case equity finance is to be raised, should it be through a rights issue or primary issue?
To what extent should internal funds be used to finance the company’s various activities?
It also examines, vis-à-vis, the extent to which the external funds can be used to carry out the
same activities. The capital structure of financing pattern decision is a significant managerial
decision. It influences shareholders’ wealth. As a result, the market value of the share may be
affected by the capital structure decision. The capital structure decision is a continuous
4
process. . Any change in the capital structure pattern affects the debt-equity mix, which in
turn influences the cost of capital. Consequently this affects the value of the firm.
Capital Structure Planning: Decision regarding what type of capital structure a
company should have is of critical importance because of its potential impact on profitability
and solvency. The small companies often do not plan their capital structure. The capital
structure is allowed to develop without any formal planning. These companies may do well in
the short-run, however, sooner or later they face considerable difficulties. The unplanned
capital structure does not permit an economical use of funds for the company. A company
should therefore plan its capital structure in such a way that it derives maximum advantage
out of it and is able to adjust more easily to the changing conditions. Instead of following any
scientific procedure to find an appropriate proportion of different types of capital which will
minimise the cost of capital and maximize the market value, a company may just either follow
what other comparable companies do regarding capital structure or may consult some
institutional lender and follow its advice.
Determinants of capital structure: capital structure should be designed very carefully.
The management of the company should set a target capital structure and the subsequent
financing decisions should be made with a view to achieve the target capital structure. Once a
company has been formed and it has been in existence for some years, the financial manager
then has to deal with the existing capital structure. The company may need funds to finance its
activities continuously. Every time the funds have to be procured, the financial manager
weighs the pros and cons of various sources of finance and selects most advantageous sources
keeping in view the target capital structure: Thus the capital structure decision is a continuous
one and has to be taken whenever a firm needs additional finance.
The factors to be considered whenever a capital structure decision is taken are: (i) Financial
Leverage or Trading on equity, (ii) Cost of capital, (iii) Cash flow, (iv) Control, (v)
Flexibility, (vi) Size of the company, (vii) Marketability, and (viii) Floatation costs. Let it’s
briefly explain these factors.
5
(i)Financial Leverage or Trading on Equity: The use of sources of finance with a fixed
cost, such as debt and preference share capital, to finance the assets of the company is known
as financial leverage or trading on equity. If the assets financed by debt yield a return
greater than the cost of the debt, the earnings per share will increase without an increase in the
owners' investment. Similarly, the earnings per share will also increase if preference share
capital is used to acquire assets. But the leverage impact is felt more in case of debt because
(i) the cost of debt is usually lower than the cost of preference share capital, and (ii) the
interest paid on debt is a deductible charge from profits for calculating the taxable income
while dividend on preference shares is not. Because of its effect on the earnings per share,
financial leverage is one of the important considerations in planning the capital structure of a
company.
(ii) Cost of Capital: Measuring the costs of various sources of funds is a complex subject and
needs a separate treatment. Needless to say that it is desirable to minimise the cost of capital.
Hence, cheaper sources should be preferred, other things remaining the same. The cost of a
source of finance is the minimum return expected by its suppliers. The expected return
depends on the degree of risk assumed by investors. A high degree of risk is assumed by
shareholders than debt-holders. In the case of debt-holders, the rate of interest is fixed and the
company is legally bound to pay interest, whether it makes profits or not. For shareholders the
rate of dividend is not fixed and the Board of Directors has no legal obligation to pay
dividends even if the profits have been made by the company.
(iii) Cash Flow: One of the features of a sound capital structure is conservation. Conservation
does not mean employing no debt or a small amount of debt. Conservatism is related to the
assessment of the liability for fixedcharges, created by the use of debt or preference capital in
the capital structure in the context of the firm's ability to generate cash to meet these fixed
charges. The fixed charges of a company include payment of interest, preference dividend and
principal. The amount of fixed charges will be high if the company employs a large amount of
debt or preference capital. Whenever a company thinks of raising additional debt, it should
analyse its expected future cash flows to meet the fixed charges with fixed charges for
companies whose cash inflows are unstable or unpredictable.
6
(iv) Control: In designing the capital structure, sometimes the existing management is
governed by its desire to continue control over the company. The existing management team
may not only what to be elected to the Board of Directors but may also desire to manage the
company without any outside interference. The ordinary shareholders have the legal right to
elect the directors of the company. If the company issues new shares, there is a risk of loss of
control. This is not a very important consideration in case of a widely held company. The
shares of such a company are widely scattered. Most of the shareholders are not interested in
taking active part in the company's management. They do not have the time and urge to attend
the meetings.
(v) Flexibility: Flexibility means the firm's ability to adapt its capital structure to the needs of
the changing conditions. The capital structure of a firm is flexible if it has no difficulty in
changing its capitalisation or sources of funds. Whenever needed the company should be able
to raise funds without undue delay and cost to finance the profitable investments. The
company should also be in a position to redeem its preference capital or debt whenever
warranted by future conditions. The financial plan of the company should be flexible enough
to change the composition of the capital structure. It should keep itself in a position to
substitute one form of financing for another to economise on the use of funds.
(vi) Size of the Company: The size of a company greatly influences the availability of funds
from different sources. A small company may often find it difficult to raise long-term loans. If
somehow it manages to obtain a long-term loan, it is available at a high rate of interest and on
inconvenient terms. The highly restrictive covenants in loans agreements of small companies
make their capital structure quite inflexible. The management thus cannot run business freely.
Small companies, therefore, have to depend on owned capital and retained earnings for their
long-term funds. A large company has a greater degree of flexibility in designing its capital
structure. It can obtain loans at easy terms and can also issue ordinary shares, preference
shares and debentures to the public. A company should make the best use of its size in
planning the capital structure.
7
(vii) Marketability: Marketability here means the ability of the company to sell or market
particular type of security in a particular period of time which in turn depends upon -the
readiness of the investors to buy that security. Marketability may not influence the initial
capital structure very much but it is an important consideration in deciding the appropriate
timing of security issues. At one time, the market favours debenture issues and at another
time, it may readily accept ordinary share issues. Due to the changing market sentiments, the
company has to decide whether to raise funds through common shares or debt. If the share
market is depressed, the company should not issue ordinary shares but issue debt and wait to
issue ordinary shares till the share market revives. During boom period in the share market, it
may not be possible for the company to issue debentures successfully. Therefore, it should
keep its debt capacity unutilized and issue ordinary4shares to raise finances.
(viii) Floatation Costs: Floatation costs are incurred when the funds are raised. Generally, the
cost of floating a debt is less than the cost of floating an equity issue. This may encourage a
company to use debt rather than issue ordinary shares. If the owner's capital is increased by
retaining the earnings, no floatation costs are incurred. Floatation cost generally is not a very
important factor influencing the capital structure of a company except in the case of small
companies.
The Modigliani-Miller theorem, proposed by Franco Modigliani and Merton Miller, forms the
basis for modern thinking on capital structure, though it is generally viewed as a purely
theoretical result since it assumes away many important factors in the capital structure
decision. The theorem states that, in a perfect market, how a firm is financed is irrelevant to
its value. This result provides the base with which to examine real world reasons why capital
structure is relevant, that is, a company's value is affected by the capital structure it employs.
Some other reasons include bankruptcy costs, agency costs, taxes, and information
asymmetry. This analysis can then be extended to look at whether there is in fact an optimal
capital structure: the one which maximizes the value of the firm
In financing pattern the accounting profession the applications include:
8
Business valuation, especially discounted cash flow, but including other valuation
problems
Capital budgeting
Cost of capital or WACC
Financial statement analysis
Project finance
Balance sheets.
Forms/Patterns of Capital Structure
The capital structure of a new company may consist of any of the following forms –
1. Equity shares only
2. Equity and Preference shares
3. Equity shares and Debentures
4. Equity shares, Preference shares and Debentures.
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Objectives of the study:
To study the financing pattern of selected companies.
To analyses the trends in financing pattern.
10
Chapter – 2
REVIEW
OF
LITERATURE
11
Modigliani and Miller (1958) argued that real investmentdecisions are
independent of financial decisions. Capital structure ofthe firms or sources of
financing has no bearing on their financialdecisions. Contrary to the neo-classical
models developed since 1950s,there are theoretical and empirical studies that
stressed on the relationship between finance and investment (Minsky 1975; Fazarri
and Variato 1994).The financial system facilitates intermediation between savers
(public)and investors (firms) and helps translate savings into investments. The
system can be credit (bank) based and securities (capital market) based7(Stiglitz
1994). Stiglitz (1994) further argued that market for corporatecontrol provides the
ultimate discipline in the stock market-dominate economies. Myres (1984) and
Myres and Majluf (1984) opened up the way to the so- called pecking order
theorem. Pecking order theorem predicts a negative relationship between
profitability (as a measure of internal funds) and debt financing.
Debt and equity are not merely alternative modes of finance, but are also
alternative modes of governance (Williamson 2002). Corporate governance is
meant to create some rules and regulations which wouldensure that external
investors and creditors in a firm can get their moneyback and would not simply be
expropriated by those who are managingthe firm (Shellfire and Vishny 1997).
Berle and Means (1932) argued thatthe separation of ownership and control may
lead managers to pursuetheir own objectives at the expense of owners. However, it
is also arguedthat the diffuse equity ownership can also make managers run the
firmto their own benefits at the expense of investors (Bolton and Schartstein1998,
p.100). Cornelli, Portes, and Schaffer (1998) observed that theprice of outstanding
shares usually drops when a firm announces a newequity issue. An increase in debt
has also a similar but less strong effect on share price. This could be the reason
why managers prefer internalfinancing, turn to debt if the former option is not
available and useequity issue only as a last resort. The rationale for the relevance
of theinternal finance could be defended from two theoretical perspectives:
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The managerial approach emphasises agency costs arising out of theseparation of
ownership from control and the role of internal finance infacilitating managerial
discretion. However in the context of developingcountries, including India, the
primary agency problem has been betweenmajority and minority owners (not
between owners and managers) (refer
La Porta et.al (1999) as cited by Reed Darryl p.15, 2004). The secondapproach
i.e. the information-theoretic approach emphasizes asymmetriesof information
between insiders (managers) and outsiders (suppliers ofcapital) leading to credit
shortage faced by firms. Mishkin (1996) noted8 that adverse selection3 and moral
hazard4 problems arising fromasymmetric information in investor-firm
relationship necessarily createdisruptions in financial markets, leading to
inefficient allocation ofinvestible funds. Asymmetric information framework
relates informationfailures to the failures of intermediaries and stock markets and
thusargues for government intervention. Stiglitz and Weiss 1981 & 1994criticize
the financial liberalization thesis on the grounds that financialmarkets are prone to
market failures. Singh (1997) further argued thatless developed countries should
promote a bank based system andprevent a market for corporate control. Singh
(2003) argued that emergingcountries with reasonably well- developed banking
system and equitmarkets would follow pecking order pattern of finance, not only
becauseof the informational asymmetries argued by Myres and Majluf
foradvanced countries,5but also due to the institutional specificities ofemerging
markets in particular, (the desire to maintain family ownershipand control of
corporations).
Mayer (1990) observed that two-thirds on the averageof investment financing in
developed countries like the US, UK, Japan,Germany, France, Italy, Canada and
Finland are mobilised throughinternal financing. In contrast to the experience of
the developedcountries
Singh and Hamid (1992) observed very different trends incertain developing
countries. The contribution of external sources tothe financing of net fixed capital
formation in the 1980s was around 50per cent with a significant share coming
13
from the stock market.Government regulations that directly discourage the use of
debt byimposing specified limits to debt ratios of firms could explain to
someextent the preference of developing countries’ corporations for equityrather
than debt financing.
Nagaraj (1996), Samuel (1996)and Singh (1998) showed similar trends in the case
of Indian corporatesector. Mathew, Rupa et.al (1999) observed a declining trend in
theinternal financing among the large and medium-sized Indian firmsbetween the
periods 1972-80 to 1988-966which supports the findingsof other studies. Similar
findings were observed by Rajakumar (2001),
Sarkar and Sarkar (2004), Joshi (2005) and Bhole (2005). Various studiessuch
as Singh and Hamid (1992), Nagaraj (1996), Singh (1995 & 1997),and Samuel
(1996) argued that the capital market boom in developingcountries is not
associated with improved corporate profitability andtherefore, may not help in
achieving quicker industrialisation and faster long-term economic growth. A
recent study by RBI (2005-06) hasobserved that the Indian corporate sector has
mobilised a large share ofresources from internal sources which accounts for 60.7
per cent during2000-01 to 2004-05. Capital market has been considered as a last
resortwhich contributed merely 9.9 per cent. The debt-equity ratio has alsodeclined
over the years as the corporate sector has been able to mobilize resources
internally (refer Appendix 1). This kind of pattern of financingconforms to the so-
called “pecking order” theory as applied in thedeveloped countries (see Singh,
2003). However, the study does notreveal the contribution of depreciation on large
scale as a source ofinternal finance which is also an important aspect to be
explored.There are few empirical studies specifically on the investmentpattern of
the Indian corporate sector.
Bhole (2005) argued that thegross or net savings rates of the private corporate
sector remained lowduring 1966-67 to 2000-01. Moreover, this sector has not kept
pacewith its capital formation. However, there is an increasing trend of
capitalformation in the private corporate sector since 2002-03.
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Mazumdar (2008), the annual rate of growth of gross fixed capitalformation at
constant prices was quite high during 1990-91 to 1996-97which accounts for 19.5
per cent. And the growth in capital formationduring the 1990s was relatively
higher than the growth registered in the1980s ( Nair 2005). Similar observations
were made by another studybased on ASI data (Nagaraj 2002). But this rate has
sharply declined tothe level of negative growth rate during 1996-97 to 2002-03
and againincreased significantly to the level of 28.51 per cent during 2002-03
to2007-08 (Mazumdar 2008). (Robertson, 2010) also observed that India’s
investment rate has increased from 25 per cent to35 per cent of GDP in the present
decade and argues that it may not getfully utilised in the long run. Notably, Indian
economy has alsoexperienced a large number of mergers and acquisitions (M&A)
duringthe liberalisation period (Beena, P.L. 2008). One- third of the M&Adeals
that occurred in India during 1978-2007 were cross-border deals(Beena, S. 2010).
Another recent study (Rao and Dhar 2010) observedthat almost two-fifth of the
foreign equity inflows was nothing but anacquisition of existing shares during
2005-06 & 2006-07. Services sectorwas exposed to large share of Private Equity
(PE) or Venture Capital(VC) investments as compared to the manufacturing
sector7. There have7 Chandrasekhar (2007) observed that the total number of
M&A deals hasincreased from the level of 467 ($18.3 million) in 2005 to 782
($28.2billion) in 2006. Out of these deals, 302 involved private equity.
Privateequity is generally acquired either through the private placement of
newshares or the sale of pre-existing shares by the controlling interest or
minorityshareholder, and therefore has features that characterise most take-
overs.11also been several studies on Indian firms‘acquisitions (Nayyar
2007;Pradhan 2007; Nagaraj 2006). However no attempt has been made
tounderstand the financing sources of these acquiring firms. Thereforethis study
intends to fill this gap to some extent, based on a smallsample. Before getting
down to the main analysis, it would be useful tonunderstand the growth of equity
market, euro issues and externalcommercial borrowings in the Indian corporate
sector during theliberalisation era.
15
Chapter – 3
Research
Methodology
16
RESEARCH METHODOLOGY
Research Methodology
Research in common parlance refers to a search for knowledge. It can be defined as a
scientific and systematic search for pertinent information on a specific topic. Research is an
art of scientific investigation. Research methodology is a scientific and systematic way to
solve research problems. A researcher has to design his methodology, i.e. in addition to the
knowledge of methods/ techniques; he has to apply the methodology as well. The
methodology may differ from problem to problem. Thus the scope of research methodology is
wider than research methods. In a way, research methodology deals with the research methods
and takes into consideration the logic behind the methods we use.
Research is an academic activity and as such the term should be used in a technical sense.
Research is an original contribution to the existing stock of knowledge making for its
advancement. It is the pursuit of truth with the help of study, observations, comparison and
experiment. In short the search for knowledge through objective and systematic method of
finding solutions to a problem is research. The systematic approach concerning generalization
and the formulation of theory is also research. As such the term ‘research’ refers to the
systematic method consisting of enunciating the problem, formulating a hypothesis, collecting
of facts or data, analyzing the facts and reaching certain conclusions either in the firm of
solutions towards the concerned problem or in certain generalizations for some theoretical
formulation.
Research Process
Research process consists of series of steps or actions necessary to effectively carry out
research. These steps are to be followed in the same manner as they occur in the sequence. It
should be remembered that the various steps involved in a research process are not mutually
exclusive, nor they are separate and distinct. They do not necessarily follow each other in any
specific order and the researcher has to constantly anticipate at each step in the research
process the requirements of subsequent steps.
Various steps involved in the research process are as follows:-
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Formulating the Research Problem
Extensive Literature Survey
Development of Working Hypothesis
Preparing the Research Design
Determining Sample Design
Collecting the Data
Execution of the Project
Analysis of Data
Hypothesis Testing
Generalizations and Interpretation
Preparation of the Report or the Thesis
This topic describes the research design, data collection method, sampling plan and data
analysis of the project.
Research Design
A research design is the arrangement of conditions for collection and analysis of data in a
manner that aims to combine relevance to a research purpose with economy in procedure. In
fact, the research design is the conceptual structure within which the research is conducted; it
constitutes the blue print for the collection, measurement and analysis of data. As such the
design includes an outline of what the researcher will do from writing the hypothesis and its
operational implications to the final analysis of data.
Features of research design are as under:
i. It is a plan that specifies the sources and types of information relevant to the research
problem.
ii. It is a strategy specifying which approach will be used for gathering and analyzing the
data.
iii. It also includes the time and cost budgets since most studies are done under these two
constraints.
18
According to Kerlinger, “Research design is the plan, structure and strategy of investigation
conceived so as to obtain answers to research questions and to control variance.”
Research design is in fact the conceptual structure within which the research is conducted. It
can be described as a blueprint for the collection, measurement and analysis of data.
Sampling Design
A sampling design is a definite plan for obtaining a sample from a given population. It refers
to the technique or the procedure the researcher would adopt in selecting items for the sample.
A sample is a portion of people drawn from a larger population. It will be representative of
the population only if it has same basic characteristics of the population from which it is
drawn according to the research problem.
Characteristics of a good sample design:
The following are the main characteristics of a good sample design:
I. Sample design must result in a truly representative sample.
II. Sample design must be such which results in a small sampling error.
III. Sample design must be viable in the context of funds available for the research study.
IV. Sample design must be such so that the systematic bias can be controlled in a better
way.
V. Sample should be such that the results of the sample study can be applied, in general,
for the universe with a reasonable level of confidence.
Universe
Universe is the set of objects to be studied in the research. It refers to all the people who are
related directly or indirectly related to the research problem.
Population
It is aggregate of all the elements of the entire universe that are to be studied with respect to
the given research problem.
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Sample
It is a subgroup of the population comprising of elements that are selected for the study. It is a
representative of the population so that inferences can be drawn about the larger population
with the help of a smaller sample.
Data Collection Tools
The task of data collection begins after the research problem has been defined and research
plan has been chalked out.
Secondary Data
Secondary data is the data that have been already collected by and readily available from
other sources. Such data are cheaper and more quickly obtainable than the primary data and
also may be available when primary data cannot be obtained at all.
Data collection
The data is collected from the annual reports of the various companies in different industries.
The analysis is based on the following companies:
1. Steels&aluminum industries.
2. Automobiles industries
3. Telecom industries.
Companies includes in steel and aluminum industries::
Steel authority
Tata steels
Hindalco
JSW
Sterlite industries
Essar steels
Hindustan zinc
Jindal steels
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Jindal saw
Welspun
Jindal stainless
Bhushan steels
National aluminum
UttamGalva
Companies includes in automobile industries::
Tata motors
Larsen turbo
MarutiSuzuki
M&M
Ashok Leyland
Tvs motors
Bajaj motors
Honda seil car
Exide industry
Companies includes in telecom industries
Bhartiairtel
Bharti heavy electrical limited
Reliance infrastructure
Siemens industries
Videocon
ABB infrastructure
Crompton grease
Idea cellular
Research Period
21
The period of the year is from 2002-2012.
Purpose
The purpose of the research is to analyze the trends in the financing pattern
22
CHAPTER-4
DATA ANALYSIS
&
INTERPRETATION
Ashok Leyland
YearShare
Capital ReserveNet
WorthTrend in Net Debt
Trend in Debt
Capital Employe
Debt Equit
%to Capital Employed
23
Worth dy
Ratio
Net
worth Debt2001-
02 118.93 891.50 1010.43 100.00 888.45 100.00 1898.88 0.88 53.21 46.792002-
03 118.93 814.68 933.61 92.40 717.23 80.73 1650.84 0.77 56.55 43.452003-
04 118.93 907.64 1026.57 101.60 499.08 56.17 1525.65 0.49 67.29 32.712004-
05 118.93 1024.35 1143.28 113.15 880.41 99.10 2023.69 0.77 56.49 43.512005-
06 122.16 1261.35 1383.51 136.92 691.93 77.88 2075.44 0.50 66.66 33.342006-
07 132.39 1739.23 1871.62 185.23 640.40 72.08 2512.02 0.34 74.51 25.492007-
08 132.39 1993.57 2125.96 210.40 887.50 99.89 3013.46 0.42 70.55 29.452008-
09 132.39 1976.00 2108.39 208.66 1961.98 220.83 4070.37 0.93 51.80 48.202009-
10 132.39 2190.00 2322.39 229.84 2280.45 256.68 4602.84 0.98 50.46 49.542010-
11 132.39 2523.65 2656.04 262.86 2658.19 299.19 5314.23 1.00 49.98 50.02
2011-12 266.07 2632.34 2898.41 286.85 2395.53 269.63 5293.94 0.83 54.75 45.25
total 1525.90 17954.31 19480.211927.9
1 14501.151632.1
9 33981.36 7.90 652.25 447.75
average 152.59 1795.431 1948.021192.79
1 1450.115163.21
9 3398.136 0.79 65.22544.775
2
AUTOMOBILE INDUSTRY
24
1 2 3 4 5 6 7 8 9 10 110.00
100.00
200.00
300.00
400.00
500.00
600.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2009-10.
25
26
TVS motors
Year
Share Capita
lReserv
eNet
Worth
Trend in Net
Worth DebtTrend in Debt
Capital Employe
d
Debt Equity Ratio
%to Capital Employed
Net
worth Debt2001-
02 23.10 300.29 323.39 100.00 166.94 100.00 490.33 0.52 65.95 34.052002-
03 23.10 399.85 422.95 130.79 121.89 73.01 544.84 0.29 77.63 22.372003-
04 23.75 551.20 574.95 177.79 119.01 71.29 693.96 0.21 82.85 17.152004-
05 23.75 655.08 678.83 209.91 186.84 111.92 865.67 0.28 78.42 21.582005-
06 23.75 742.33 766.08 236.89 385.04 230.65 1151.12 0.50 66.55 33.452006-
07 23.75 785.52 809.27 250.25 633.56 379.51 1442.83 0.78 56.09 43.912007-
08 23.75 797.83 821.58 254.05 666.34 399.15 1487.92 0.81 55.22 44.782008-
09 23.75 789.38 813.13 251.44 905.98 542.70 1719.11 1.11 47.30 52.702009-
10 23.75 841.63 865.38 267.60 1003.29 600.99 1868.67 1.16 46.31 53.692010-
11 47.51 1951.90 1999.41 618.27 785.42 470.48 2784.83 0.39 71.80 28.202011-
12 47.51 1121.79 1169.30 361.58 715.46 428.57 1884.76 0.61 62.04 37.96
Total 307.47 8936.80 9244.27 2858.55 5689.77 3408.27 14934.04 6.66 710.15 389.85
average 30.747 893.68 924.427 285.855 568.977 340.8272 1493.4040.6661
4 71.01514 38.98486
1 2 3 4 5 6 7 8 9 10 110.00
200.00
400.00
600.00
800.00
1000.00
1200.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2010-1. It shows the continuous increase every year but at the end it is decrease in year 2012. The lowest trend in debt was in year 2002-03 and in 2010-11 it increase and decrease in 2012.
27
TATA Motors
YearShare
Capital ReserveNet
Worth
Trend in Net Worth Debt
Trend in Debt
Capital Employed
Debt Equity Ratio
%to Capital Employed
Net
worth
2001-02 319.82 2145.24 2465.06 100.00 2307.72 100.00 4772.78 0.94 51.65
2002-03 319.83 2277.33 2597.16 105.36 1458.31 63.19 4055.47 0.56 64.04
2003-04 353.00 3236.77 3589.77 145.63 1259.33 54.57 4849.10 0.35 74.03
2004-05 361.79 3749.60 4111.39 166.79 2495.42 108.13 6606.81 0.61 62.23
2005-06 382.87 5127.81 5510.68 223.55 2936.84 127.26 8447.52 0.53 65.23
2006-07 385.41 6458.39 6843.80 277.63 4009.14 173.73 10852.94 0.59 63.06
2007-08 385.54 7428.45 7813.99 316.99 6280.52 272.15 14094.51 0.80 55.442008-09 514.05 11855.15 12369.20 501.78 13165.5 570.50 25534.76 1.06 48.44
2009-10 570.60 14208.55 14779.15 599.55 16625.9 720.45 31405.06 1.12 47.06
2010-11 634.65 19351.40 19986.05 810.77 15898.7 688.94 35884.80 0.80 55.70
2011-12 634.75 18709.16 19343.91 784.72 11011.6 477.16 30355.54 0.57 63.72
Total 4862.31 94547.85 99410.16 4032.7 77449.1 3356.09 176859.29 7.93 650.60
average 486.231 9454.785 9941.016 403.27 7744.91 335.609 17685.929 0.7932 65.0602
28
1 2 3 4 5 6 7 8 9 10 110.00
200.00
400.00
600.00
800.00
1000.00
1200.00
1400.00
1600.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2010-1. It shows the continuous increase every year but at the end it is decrease in year 2012. The lowest trend in debt was in year 2002-03 and in 2010-11 it increase and decrease in 2012.
29
Honda Seil Product
Year
Share Capit
alReser
veNet
Worth
Trend in Net
Worth
Debt
Trend in Debt
Capital Employ
ed
Debt Equi
ty Rati
o%Capital employed
Net
worthDeb
t2001-
02 10.14113.1
9 123.33100.0
07.1
5100.00 130.48 0.06 94.52 5.48
2002-03 10.14
124.99 135.13
109.57
6.94
97.06 142.07 0.05 95.12 4.88
2003-04 10.14
130.73 140.87
114.22
12.07
168.81 152.94 0.09 92.11 7.89
2004-05 10.14
135.24 145.38
117.88
10.05
140.56 155.43 0.07 93.53 6.47
2005-06 10.14
140.99 151.13
122.54
0.00 0.00 151.13 0.00
100.00 0.00
2006-07 10.14
153.62 163.76
132.78
0.00 0.00 163.76 0.00
100.00 0.00
2007-08 10.14
173.37 183.51
148.80
0.00 0.00 183.51 0.00
100.00 0.00
2008-09 10.14
184.27 194.41
157.63
0.00 0.00 194.41 0.00
100.00 0.00
2009-10 10.14
192.21 202.35
164.07
0.00 0.00 202.35 0.00
100.00 0.00
2010-11 10.14
213.00 223.14
180.93
0.00 0.00 223.14 0.00
100.00 0.00
2011-12 10.14
254.07 264.21
214.23
0.00 0.00 264.21 0.00
100.00 0.00
total111.5
41815.
681927.2
21562.
6536.21
506.43 1963.43 0.26
1075.28
24.72
average 11.15
181.57
192.722
156.265
3.621
50.64 196.34
0.0264
107.528
2.472
30
1 2 3 4 5 6 7 8 9 10 110.00
50.00
100.00
150.00
200.00
250.00
300.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and it decrese in year 2005and continous increase in year 2011.
31
Bajaj motors
YEAR
Share Capita
l ReserveNet
Worth
Trend in Net Worth Debt
Trend in Debt
Capital Employe
d
Debt Equit
y Ratio
%to Capital Employed
2005-06 101.18 4669.55 4770.73 100.00 1467.1 100.0 6237.88 0.31 76.48 23.52
2006-07 101.18 5433.14 5534.32 116.01 1625.4 110.7 7159.75 0.29 77.30 22.70
2007-08 144.68 1442.91 1587.59 33.28 97.48 6.64 1685.07 0.06 94.22 5.78
2008-09 144.68 1725.01 1869.69 39.19 325.15 22.16 2194.84 0.17 85.19 14.81
2009-10 144.68 2783.66 2928.34 61.38 1338.5 91.24 4266.92 0.46 68.63 31.37
2010-11 289.37 4620.85 4910.22 102.92 1570.0 107.0 6480.22 0.32 75.77 24.23
2011-12 289.37 5751.70 6041.07 126.63 1334.3 90.95 10307.99 0.22 58.61 12.94
total 1215.1 26426.8 27641.9 579.41 7758.1 528.7 38332.67 1.83 536.1 135.3
average 121.51 2642.68 2764.19 57.940 775.81 52.88 3833.267 0.183 53.61 13.54
32
1 2 3 4 5 6 70.00
50.00
100.00
150.00
200.00
250.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2007-8. It shows the decrese in year2003 and cintinous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2006
33
Larsen& Turbo
YearShare
Capital ReserveNet
Worth
Trend in Net
Worth DebtTrend in Debt
Capital Employe
d
Debt Equity Ratio
%to Capital Employed
Net
worth Debt2001-
02 248.66 3058.79 3307.45 100.00 3548.87 100.00 6856.32 1.07 48.24 51.762002-
03 266.67 3279.53 3546.20 107.22 2176.00 61.32 5722.20 0.61 61.97 38.032003-
04 24.88 2717.55 2742.43 82.92 1324.35 37.32 4066.78 0.48 67.43 32.572004-
05 25.98 3312.28 3338.26 100.93 1859.66 52.40 5197.92 0.56 64.22 35.782005-
06 27.98 4583.32 4611.30 139.42 1453.57 40.96 6064.87 0.32 76.03 23.972006-
07 56.65 5683.85 5740.50 173.56 2077.75 58.55 7818.25 0.36 73.42 26.582007-
08 58.47 9470.71 9529.18 288.11 3383.99 95.35 12913.17 0.36 73.79 26.212008-
09 117.1412317.9
6 12435.10 375.97 6556.03 184.74 18991.13 0.53 65.48 34.522009-
10 120.4418142.8
2 18263.26 552.19 6800.83 191.63 25064.09 0.37 72.87 27.132010-
11 121.7721334.0
5 21455.82 648.71 7161.77 201.80 28617.59 0.33 74.97 25.032011-
12 122.4825079.4
0 25201.88 761.97 9895.77 278.84 35097.65 0.39 71.81 28.19
total 624.93 96612.1 97237.0 2939.94 37329.7 1051.88 134566.75 2.66 508.38 191.62averag
e 62.493 9661.21 9723.70 293.9939 3732.9 105.18 13456.67 0.265 50.838 19.16
34
1 2 3 4 5 6 7 8 9 10 110.00
200.00
400.00
600.00
800.00
1000.00
1200.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2009-10.
35
Maruti Suzuki
YearShare
Capital ReserveNet
Worth
Trend in Net Worth Debt
Trend in Debt
Capital Employe
d
Debt Equity Ratio
%to Capital Employed
Net
worth Debt2001-
02 132.30 2575.00 2707.30 100.00 656.00 100.00 3363.30 0.24 80.50 19.502002-
03 144.50 2953.50 3098.00 114.43 456.00 69.51 3554.00 0.15 87.17 12.832003-
04 144.50 3446.70 3591.20 132.65 311.90 47.55 3903.10 0.09 92.01 7.992004-
05 144.50 4234.30 4378.80 161.74 307.60 46.89 4686.40 0.07 93.44 6.562005-
06 144.50 5308.10 5452.60 201.40 71.70 10.93 5524.30 0.01 98.70 1.302006-
07 144.50 6709.40 6853.90 253.16 636.80 97.07 7490.70 0.09 91.50 8.502007-
08 144.50 8270.90 8415.40 310.84 900.20 137.23 9315.60 0.11 90.34 9.662008-
09 144.50 9200.40 9344.90 345.17 698.90 106.54 10043.80 0.07 93.04 6.962009-
10 144.50 11690.6 11835.1 437.16 821.40 125.21 12656.50 0.07 93.51 6.492010-
11 144.50 13723.0 13867.5 512.23 309.30 47.15 14176.80 0.02 97.82 2.182011-
12 144.50 15042.9 15187.4 560.98 1078.3 164.38 16265.70 0.07 93.37 6.63
total1011.5
069945.3
070956.8
0 2620.944516.6
0 688.51 75473.40 0.45 658.28 41.72
average 101.15 6994.53 7095.68262.094
3 451.6668.850
6 7547.340.0450
5 65.82784.172
2
36
1 2 3 4 5 6 7 8 9 10 110.00
100.00
200.00
300.00
400.00
500.00
600.00
700.00
800.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03and its is reduce by and 2005-06 and the highest was in year 2009-10.
37
Mahindra&Mahindra
Year
Share Capita
l ReserveNet
Worth
Trend in Net Worth Debt
Trend in
Debt
Capital Employe
d
Debt Equity Ratio
%to Capital Employed
Net
worth Debt2001-
02 116.01 1371.89 1487.90 100.00 1377.07 100.00 2864.97 0.93 51.93 48.072002-
03 116.01 1438.31 1554.32 104.46 1139.84 82.77 2694.16 0.73 57.69 42.312003-
04 116.01 1664.15 1780.16 119.64 729.81 53.00 2509.97 0.41 70.92 29.082004-
05 116.01 1881.93 1997.94 134.28 1052.62 76.44 3050.56 0.53 65.49 34.512005-
06 233.40 2662.14 2895.54 194.61 883.39 64.15 3778.93 0.31 76.62 23.382006-
07 238.03 3302.01 3540.04 237.92 1636.00 118.80 5176.04 0.46 68.39 31.612007-
08 239.07 4098.53 4337.60 291.52 2587.06 187.87 6924.66 0.60 62.64 37.362008-
09 272.62 4959.26 5231.88 351.63 4052.76 294.30 9284.64 0.77 56.35 43.652009-
10 282.95 7527.60 7810.55 524.94 2880.15 209.15 10690.70 0.37 73.06 26.942010-
11 293.62 9974.62 10268.2 690.12 2405.29 174.67 12673.53 0.23 81.02 18.982011-
12 294.52 11799.2 12093.7 812.81 3174.22 230.51 15268.00 0.26 79.21 20.79
total 1854.2 44323.4 46177.6 3103.54 17618.8 1279.4 63796.50 3.00 497.30 202.70averag
e 185.42 4432.34 4617.76 310.354 1761.88 127.94 6379.65 0.3003 49.729620.270
4
38
1 2 3 4 5 6 7 8 9 10 110.00
200.00
400.00
600.00
800.00
1000.00
1200.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2011-12
39
Exide Industries
Year
Share Capita
l ReserveNet
Worth
Trend in Net Worth Debt
Trend in
Debt
Capital Employe
d
Debt Equit
y Ratio
%to Capital Employed
Net
worth Debt2001-
02 35.73 73.39 109.12 100.00 342.98100.0
0 452.10 3.14 24.14 75.862002-
03 35.61 260.65 296.26 271.50 281.66 82.12 577.92 0.95 51.26 48.742003-
04 71.22 263.70 334.92 306.93 198.97 58.01 533.89 0.59 62.73 37.272004-
05 75.00 354.09 429.09 393.23 290.18 84.61 719.27 0.68 59.66 40.342005-
06 75.00 429.16 504.16 462.02 289.85 84.51 794.01 0.57 63.50 36.502006-
07 75.00 552.98 627.98 575.49 324.70 94.67 952.68 0.52 65.92 34.082007-
08 80.00 909.45 989.45 906.75 349.81101.9
9 1339.26 0.35 73.88 26.122008-
09 80.00 1137.75 1217.75 1115.97 317.18 92.48 1534.93 0.26 79.34 20.662009-
10 85.00 2104.50 2189.50 2006.51 89.99 26.24 2279.49 0.04 96.05 3.952010-
11 85.00 2630.25 2715.25 2488.32 215.00 62.69 2930.25 0.08 92.66 7.342011-
12 85.00 2946.64 3031.64 2778.26 0.00 0.00 3031.64 0.00 100.00 0.00
total 565.0010710.7
3 11275.7310333.3
3 1586.53462.5
7 12862.26 1.83 571.34 128.66
average 56.51071.07
3 1127.571033.33
3 158.65346.25
7 1286.226 0.1826 57.134412.865
6
40
1 2 3 4 5 6 7 8 9 10 110.00
500.00
1000.00
1500.00
2000.00
2500.00
3000.00
Trend in DebtNet Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2011-12
41
STEEL AND ALUMINUM INDUSTRY
Hindalco
YearShare
Capital ReserveNet
Worth
Trend in Net Worth Debt
Trend in Debt
Capital Employed
Debt Equity Ratio
%to Capital Employed
Net
worth Debt2001-
02 74.46 4507.10 4581.56 100.00 957.73 100.00 5539.29 0.21 82.71 17.292002-
03 92.46 6098.63 6191.09 135.13 2395.02 250.07 8586.11 0.39 72.11 27.892003-
04 92.48 6765.42 6857.90 149.68 2564.60 267.78 9422.50 0.37 72.78 27.222004-
05 92.78 7573.80 7666.58 167.34 3800.00 396.77 11466.58 0.50 66.86 33.142005-
06 98.57 9507.69 9606.26 209.67 4903.44 511.99 14509.70 0.51 66.21 33.792006-
07 104.33 12313.71 12418.04 271.04 7368.60 769.38 19786.64 0.59 62.76 37.242007-
08 122.65 17173.67 17296.32 377.52 8328.58 869.62 25624.90 0.48 67.50 32.502008-
09 170.46 23584.69 23755.15 518.49 8324.29 869.17 32079.44 0.35 74.05 25.952009-
10 191.37 27715.61 27906.98 609.12 6356.90 663.75 34263.88 0.23 81.45 18.552010-
11 191.46 29504.17 29695.63 648.16 7271.50 759.24 36967.13 0.24 80.33 19.672011-
12 191.48 31299.68 31491.16 687.3514570.9
1 1521.40 46062.07 0.46 68.37 31.63
Total 1422.50 176044.17 177466.67 3873.5066841.5
7 6979.17 244308.24 4.34 795.12 304.88average 142.25 17604.42 17746.67 387.35
6684.157 697.917 24430.82 0.4337 79.512
42
1 2 3 4 5 6 7 8 9 10 110.00
500.00
1000.00
1500.00
2000.00
2500.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2009-10.
43
National Aluminium
Year
Share Capit
alReserv
eNet
Worth
Trend in Net Wort
h Debt
Trend in Debt
Capital Employ
ed
Debt Equit
y Ratio
%to Capital Employed
Net
worthDeb
t2001-
02644.3
12580.9
33225.2
4100.0
01563.
45100.0
0 4788.69 0.48 67.3532.6
52002-
03644.3
72665.7
33310.1
0102.6
31324.
44 84.71 4634.54 0.40 71.4228.5
82003-
04644.3
73112.3
63756.7
3116.4
8654.3
9 41.86 4411.12 0.17 85.1614.8
42004-
05644.3
74053.0
04697.3
7145.6
4 0.00 0.00 4697.37 0.00 100.00 0.002005-
06644.3
75248.3
65892.7
3182.7
1 0.00 0.00 5892.73 0.00 100.00 0.002006-
07644.3
77050.9
17695.2
8238.6
0 0.00 0.00 7695.28 0.00 100.00 0.002007-
08644.3
18230.1
48874.4
5275.1
6 0.00 0.00 8874.45 0.00 100.00 0.002008-
09644.3
19125.5
09769.8
1302.9
2 0.00 0.00 9769.81 0.00 100.00 0.002009-
10644.3
19751.2
710395.
58322.3
2 0.00 0.0010395.5
8 0.00 100.00 0.002010-
111288.
62 75.991364.6
1 42.31 14.88 0.95 1379.49 0.01 98.92 1.082011-
121288.
6210426.
4611715.
08363.2
3 0.00 0.0011715.0
8 0.00 100.00 0.00
total8376.
3362320.
6570696.
982191.
993557.
16227.5
274254.1
4 1.071022.8
677.1
4average
837.633
6232.065
7069.698 219.2
355.72
22.752
7425.414 0.107
102.286
7.714
44
1 2 3 4 5 6 7 8 9 10 110.00
50.00
100.00
150.00
200.00
250.00
300.00
350.00
400.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in debt was in year 2002-03 and the highest was in year 2009 and its decrease in year2010 and immediately it up in year of 2011.. The lowest trend in equity was in year 2004 and it merge with the debt the and the highest was in year 2011-12
45
Jindal Stainless
Year
Share Capit
alReserv
eNet
Worth
Trend in Net
Worth Debt
Trend in Debt
Capital Employ
ed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
02 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.002002-
03 0.05 391.80 391.85100.0
0 787.61100.0
0 1179.46 2.01 33.22 66.782003-
04 19.98 537.25 557.23142.2
0 765.14 97.15 1322.37 1.37 42.14 57.862004-
05 21.98 770.79 792.77202.3
11346.7
0170.9
9 2139.47 1.70 37.05 62.952005-
06 26.11 983.101009.2
1257.5
52193.8
2278.5
4 3203.03 2.17 31.51 68.492006-
07 27.641374.1
31401.7
7357.7
32656.3
2337.2
6 4058.09 1.89 34.54 65.462007-
08 30.921757.1
41788.0
6456.3
14290.0
5544.6
9 6078.11 2.40 29.42 70.582008-
09 32.431257.9
11290.3
4329.2
95639.7
6716.0
6 6930.10 4.37 18.62 81.382009-
10 37.121876.4
81913.6
0488.3
57528.4
3955.8
6 9442.03 3.93 20.27 79.732010-
11 37.462215.1
32252.5
9574.8
68490.9
31078.
0610743.5
2 3.77 20.97 79.032011-
12 37.902144.2
32182.1
3556.8
89244.0
31173.
6811426.1
6 4.24 19.10 80.90
total271.5
913307.
9613579.
553465.
5042942.
795452.
2956522.3
4 27.86286.8
4713.1
6average
27.159 1330.8
1357.96
346.55
4294.279
545.23 5652.23 2.786
28.684
71.3165
46
1 2 3 4 5 6 7 8 9 10 110.00
200.00
400.00
600.00
800.00
1000.00
1200.00
1400.00
1600.00
1800.00
2000.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2007-08 .It shows the continuous increase every year. In year 2008 it decreases and again continuous up slightly every year. The lowest trend in debt was in year 2001-02 and 2005-06 and the highest was in year 2009-10.
47
Essar Steel
Year
Share Capit
alReser
veNet
Worth
Trend in Net
Worth Debt
Trend in Debt
Capital Employ
ed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
02330.3
51543.6
4 1873.99100.0
05748.4
9100.0
0 7622.48 3.07 24.5975.4
12002-
03330.3
5 96.87 427.22 22.805248.1
7 91.30 5675.3912.2
8 7.5392.4
72003-
04507.9
7 86.59 594.56 31.734674.9
7 81.33 5269.53 7.86 11.2888.7
22004-
05507.9
8 686.54 1194.52 63.744510.5
9 78.47 5705.11 3.78 20.9479.0
62005-
06581.1
71246.0
0 1827.17 97.507985.6
6138.9
2 9812.83 4.37 18.6281.3
82006-
071140.
483080.9
5 4221.43225.2
66943.2
4120.7
811164.6
7 1.64 37.8162.1
92007-
081140.
483447.2
5 4587.73244.8
16116.5
8106.4
010704.3
1 1.33 42.8657.1
42008-
091140.
483554.2
4 4694.72250.5
27311.3
9127.1
912006.1
1 1.56 39.1060.9
02009-
102213.
736838.7
0 9052.43483.0
618187.
24316.3
827239.6
7 2.01 33.2366.7
72010-
11 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.002011-
12 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total7892.
9920580.
7828473.7
71519.
4266726.
331160.
7695200.1
037.9
1 235.96664.
04Average
789.299
2058.078 2847.38
151.942
6672.63
116.08 9520.01
3.7906 23.5958
66.404
48
1 2 3 4 5 6 7 8 9 10 110.00
100.00
200.00
300.00
400.00
500.00
600.00
700.00
800.00
900.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2009-10.
49
Hindustan Time
Year
Share
Capital
Reserve
Net Worth
Trend in Net Worth Debt
Trend in
Debt
Capital Emplo
yed
Debt Equi
ty Rati
o%to Capital Employed
Net
worthDebt
2001-02
422.53 644.74 1067.27 100.00 3.76 100.00 1071.03 0.00 99.65
0.35
2002-03
422.53 747.21 1169.74 109.60 0.76 20.21 1170.50 0.00 99.94
0.06
2003-04
422.53
1084.34 1506.87 141.19
607.80
16164.89 2114.67 0.40 71.26
28.74
2004-05
422.53
1655.21 2077.74 194.68
571.32
15194.68 2649.06 0.27 78.43
21.57
2005-06
422.53
3007.25 3429.78 321.36
758.02
20160.11 4187.80 0.22 81.90
18.10
2006-07
422.53
7204.53 7627.06 714.63 0.39 10.37 7627.45 0.00 99.99
0.01
2007-08
422.53
11425.66
11848.19
1110.14 0.39 10.37
11848.58 0.00 100.00
0.00
2008-09
422.53
13935.05
14357.58
1345.26 8.69 231.12
14366.27 0.00 99.94
0.06
2009-10
422.53
17701.44
18123.97
1698.16 60.47
1608.24
18184.44 0.00 99.67
0.33
2010-11
845.06
21688.13
22533.19
2111.29 0.39 10.37
22533.58 0.00 100.00
0.00
2011-12
845.06
26036.20
26881.26
2518.69 0.39 10.37
26881.65 0.00 100.00
0.00
total5492.
89105129
.76110622.
6510365.
012012.
3853520.
74112635.
03 0.91 1030.7769.23
average
549.289
10512.98
11062.265
1036.501
201.24
5352.07 11263.5
0.0908 103.08
6.923
50
1 2 3 4 5 6 7 8 9 10 110.00
5000.00
10000.00
15000.00
20000.00
25000.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2009-2010 .It shows the continuous increase every year. The lowest trend in debt was in year 2001-02 its immediately increase in year 2003 and in year 2006 it decreases at high value 1n year 2006 it minor up and downs and 2009-10 it is highest.
51
JSW
Year
Share Capit
alReser
veNet
Worth
Trend in Net
Worth Debt
Trend in Debt
Capital Employ
ed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
021351.
99 549.91 1901.90100.0
05612.3
1100.0
0 7514.21 2.95 25.3174.6
92002-
031352.
03 660.58 2012.61105.8
2 76.46 1.36 2089.07 0.04 96.34 3.662003-
041352.
05 131.90 1483.95 78.024787.0
3 85.30 6270.98 3.23 23.6676.3
42004-
05190.1
02680.5
9 2870.69150.9
43836.4
1 68.36 6707.10 1.34 42.8057.2
02005-
06218.0
33859.1
6 4077.19214.3
74096.0
5 72.98 8173.24 1.00 49.8850.1
22006-
07225.0
15068.2
5 5293.26278.3
14173.0
3 74.35 9466.29 0.79 55.9244.0
82007-
08248.0
87140.2
4 7388.32388.4
77546.5
3134.4
614934.8
5 1.02 49.4750.5
32008-
09248.0
87422.2
4 7670.32403.3
011272.
63200.8
618942.9
5 1.47 40.4959.5
12009-
10248.0
89179.2
3 9427.31495.6
811585.
10206.4
221012.4
1 1.23 44.8755.1
32010-
11284.1
516132.
7116416.8
6863.1
811951.
34212.9
528368.2
0 0.73 57.8742.1
32011-
12284.1
517934.
3118218.4
6957.9
112302.
22219.2
030520.6
8 0.68 59.6940.3
1
total6001.
7570759.
1276760.8
74036.
0177239.
111376.
24153999.
9814.4
7 546.31553.
69average
600.175
7075.91 7676.09 403.6
7723.91
137.62 15400
1.447 54.6307
55.369
52
1 2 3 4 5 6 7 8 9 10 110.00
200.00
400.00
600.00
800.00
1000.00
1200.00
1400.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2009-10.
53
Jindal Saw
Year
Share
Capital
Reserve
Net Worth
Trend in Net Wort
h Debt
Trend in Debt
Capital Emplo
yed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
02 46.48 225.68 272.16 100.00 225.63100.0
0 497.79 0.83 54.67 45.332002-
03 38.98 290.34 329.32 121.00 211.18 93.60 540.50 0.64 60.93 39.072003-
04 38.98 335.56 374.54 137.62 564.22250.0
6 938.76 1.51 39.90 60.102004-
05147.1
1 679.23 826.34 303.62 997.69442.1
8 1824.03 1.21 45.30 54.702005-
06148.3
6 854.86 1003.22 368.611379.9
6611.6
0 2383.18 1.38 42.10 57.902006-
07151.1
41831.1
8 1982.32 728.371159.3
9513.8
5 3141.71 0.58 63.10 36.902007-
08152.1
22168.6
9 2320.81 852.741636.5
6725.3
3 3957.37 0.71 58.65 41.352008-
09 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.002009-
10154.7
43481.6
1 3636.351336.1
1 737.06326.6
7 4373.41 0.20 83.15 16.852010-
11 55.253961.2
2 4016.471475.7
81611.6
6714.2
9 5628.13 0.40 71.36 28.642011-
12 55.253497.6
7 3552.921305.4
52485.3
61101.
52 6038.28 0.70 58.84 41.16
total988.4
117326.
0418314.4
56729.3
011008.
714879.
1029323.1
6 8.15 577.99422.0
1average
98.841
1732.604 1831.45
672.9295
1100.87
487.91
2932.316
0.815 57.7992
42.2008
54
1 2 3 4 5 6 7 8 9 10 110.00
200.00
400.00
600.00
800.00
1000.00
1200.00
1400.00
1600.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. There are various up and down in year 2008 -09 The lowest trend in debt was in year 2008 and the highest was in year 2011-12
55
Uttam Galva
Year
Share
Capital
Reserve
Net Worth
Trend in Net Worth Debt
Trend in Debt
Capital Emplo
yed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
02 72.41 44.09 116.50 100.00 358.56100.0
0 475.06 3.08 24.52 75.482002-
03 72.41 54.39 126.80 108.84 371.19103.5
2 497.99 2.93 25.46 74.542003-
04 74.90 78.33 153.23 131.53 399.97111.5
5 553.20 2.61 27.70 72.302004-
05 85.33177.8
9 263.22 225.94 505.18140.8
9 768.40 1.92 34.26 65.742005-
06 87.53255.7
0 343.23 294.62 857.02239.0
2 1200.25 2.50 28.60 71.402006-
07108.2
9441.2
0 549.49 471.67 982.94274.1
4 1532.43 1.79 35.86 64.142007-
08115.4
7595.5
7 711.04 610.331048.1
5292.3
2 1759.19 1.47 40.42 59.582008-
09113.9
7709.9
4 823.91 707.221410.9
0393.4
9 2234.81 1.71 36.87 63.132009-
10122.2
6775.5
4 897.80 770.642043.4
9569.9
2 2941.29 2.28 30.52 69.482010-
11122.2
6824.7
9 947.05 812.922130.8
0594.2
7 3077.85 2.25 30.77 69.232011-
12122.2
6902.5
7 1024.83 879.682016.4
1562.3
6 3041.24 1.97 33.70 66.30
total1097.
094860.
01 5957.105113.3
912124.
613381.
4718081.7
124.5
0 348.67751.3
3average
109.71 486 595.71
511.3391
1212.461
338.147
1808.171
2.4501 34.8671
75.1329
56
1 2 3 4 5 6 7 8 9 10 110.00
100.00
200.00
300.00
400.00
500.00
600.00
700.00
800.00
900.00
1000.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2009-10.
57
Tata Steel
Year
Share Capit
alReserv
eNet
Worth
Trend in Net
Worth Debt
Trend in Debt
Capital Emplo
yed
Debt Equi
ty Rati
o%to Capital Employed
Net
worthDeb
t2001-
02 367.973077.9
9 3445.96100.0
04707.8
2100.0
08153.7
8 1.37 42.2657.7
42002-
03 367.972816.8
4 3184.81 92.424225.6
1 89.767410.4
2 1.33 42.9857.0
22003-
04 369.184146.6
8 4515.86131.0
53373.2
8 71.657889.1
4 0.75 57.2442.7
62004-
05 553.676506.2
5 7059.92204.8
82739.7
0 58.199799.6
2 0.39 72.0427.9
62005-
06 553.669201.6
3 9755.29283.0
92516.1
5 53.4512271.
44 0.26 79.5020.5
02006-
07 580.6713368.
4213949.0
9404.8
09645.3
3204.8
823594.
42 0.69 59.1240.8
82007-
086203.3
021097.
0027300.3
0792.2
418021.
69382.8
045321.
99 0.66 60.2439.7
62008-
096203.3
023501.
1529704.4
5862.0
126946.
18572.3
756650.
63 0.91 52.4347.5
72009-
10 887.4136281.
3437168.7
51078.
6225239.
20536.1
162407.
95 0.68 59.5640.4
42010-
11 959.414730.0
2 5689.43165.1
028301.
14601.1
533990.
57 4.97 16.7483.2
62011-
12 971.4151245.
0552216.4
61515.
3023693.
82503.2
975910.
28 0.45 68.7931.2
1
total18017.
95175972
.37193990.
325629.
50149409
.923173.
65343400
.2412.4
5610.89 146.
47average
1801.795
17597.237
19399.03
562.95
14940.99
317.365
34340.024
1.2452
61.089 14.647
58
1 2 3 4 5 6 7 8 9 10 110.00
500.00
1000.00
1500.00
2000.00
2500.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2001-02 and the highest was in year 2009 and decrease in year 2010 and then increase in year2011.. The lowest trend in debt was in year 2005 and 2005-06 and the highest was in year 2011-12
59
Bhushan Industries
Year
Share
Capital
Reserve
Net Worth
Trend in Net Wort
h Debt
Trend in
Debt
Capital Emplo
yed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
02 33.04 424.08 457.12 100.00 594.53 100.00 1051.65 1.30 43.4756.5
32002-
03 40.47 462.48 502.95 110.03 777.82 130.83 1280.77 1.55 39.2760.7
32003-
04 40.47 548.21 588.68 128.78 930.60 156.53 1519.28 1.58 38.7561.2
52004-
05 40.47 690.12 730.59 159.821317.4
7 221.60 2048.06 1.80 35.6764.3
32005-
06 41.27 848.40 889.67 194.632036.1
8 342.49 2925.85 2.29 30.4169.5
92006-
07 42.471172.0
3 1214.50 265.693241.9
8 545.30 4456.48 2.67 27.2572.7
52007-
08 42.471582.8
5 1625.32 355.565718.1
3 961.79 7343.45 3.52 22.1377.8
72008-
09 42.471985.5
9 2028.06 443.668066.2
51356.7
410094.3
1 3.98 20.0979.9
12009-
10 79.153912.5
2 3991.67 873.2211404.
111918.1
715395.7
8 2.86 25.9374.0
72010-
11111.1
65185.2
5 5296.411158.6
516592.
632790.8
821889.0
4 3.13 24.2075.8
02011-
12128.4
17267.9
5 7396.361618.0
319816.
563333.1
527212.9
2 2.68 27.1872.8
2
total641.8
524079.
4824721.3
35408.0
670496.
2611857.
4895217.5
927.3
5334.34 765.
66average
64.185
2407.948
2472.133
540.8061
7049.63
1185.75
9521.759
2.7354
33.434 76.566
60
1 2 3 4 5 6 7 8 9 10 110.00
1000.00
2000.00
3000.00
4000.00
5000.00
6000.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2001-02 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2009-10.
61
Steel Authority
Year
Share Capit
alReserv
eNet
Worth
Trend in Net
Worth Debt
Trend in Debt
Capital Emplo
yed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
024130.4
01300.6
5 5431.05100.0
014011.
63100.0
019442.
68 2.58 27.93 72.072002-
034130.4
01605.1
6 5735.56105.6
112969.
65 92.5618705.
21 2.26 30.66 69.342003-
044130.4
0 907.27 5037.67 92.768688.7
6 62.0113726.
43 1.72 36.70 63.302004-
054130.4
06176.2
510306.6
5189.7
75769.7
9 41.1816076.
44 0.56 64.11 35.892005-
064130.4
08471.0
112601.4
1232.0
34297.6
2 30.6716899.
03 0.34 74.57 25.432006-
074130.4
013182.
7517313.1
5318.7
83680.5
2 26.2720993.
67 0.21 82.47 17.532007-
084130.4
018933.
1723063.5
7424.6
63045.2
4 21.7326108.
81 0.13 88.34 11.662008-
094130.4
023853.
7027984.1
0515.2
67538.7
9 53.8035522.
89 0.27 78.78 21.222009-
104130.4
09186.3
013316.7
0245.2
016511.
25117.8
429827.
95 1.24 44.65 55.352010-
114130.4
032939.
0737069.4
7682.5
520165.
49143.9
257234.
96 0.54 64.77 35.232011-
124130.5
335680.
7939811.3
2733.0
316097.
21114.8
855908.
53 0.40 71.21 28.79
total45434.
53152236
.12197670.
653639.
64112775
.95804.8
7310446
.6010.2
7664.18 435.8
2average
4543.45
15223.61
19767.07
363.96
11277.595
80.4874
31044.66
1.0269
66.418 43.5821
62
1 2 3 4 5 6 7 8 9 10 110.00
100.00
200.00
300.00
400.00
500.00
600.00
700.00
800.00
900.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2001-02 and the highest was in year 2008-09 anditdecrese in yaer 2010 and then increase in year 2011 and 2012. It shows the continuous increase every year. The lowest trend in debt was in year 2009-10 and 2005-06 and the highest was in year 2010-11.
63
Steel Authority
Year
Share Capit
alReserv
eNet
Worth
Trend in Net
Worth Debt
Trend in Debt
Capital Emplo
yed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
024130.4
01300.6
5 5431.05100.0
014011.
63100.0
019442.
68 2.58 27.93 72.072002-
034130.4
01605.1
6 5735.56105.6
112969.
65 92.5618705.
21 2.26 30.66 69.342003-
044130.4
0 907.27 5037.67 92.768688.7
6 62.0113726.
43 1.72 36.70 63.302004-
054130.4
06176.2
510306.6
5189.7
75769.7
9 41.1816076.
44 0.56 64.11 35.892005-
064130.4
08471.0
112601.4
1232.0
34297.6
2 30.6716899.
03 0.34 74.57 25.432006-
074130.4
013182.
7517313.1
5318.7
83680.5
2 26.2720993.
67 0.21 82.47 17.532007-
084130.4
018933.
1723063.5
7424.6
63045.2
4 21.7326108.
81 0.13 88.34 11.662008-
094130.4
023853.
7027984.1
0515.2
67538.7
9 53.8035522.
89 0.27 78.78 21.222009-
104130.4
09186.3
013316.7
0245.2
016511.
25117.8
429827.
95 1.24 44.65 55.352010-
114130.4
032939.
0737069.4
7682.5
520165.
49143.9
257234.
96 0.54 64.77 35.232011-
124130.5
335680.
7939811.3
2733.0
316097.
21114.8
855908.
53 0.40 71.21 28.79
total45434.
53152236
.12197670.
653639.
64112775
.95804.8
7310446
.6010.2
7664.18 435.8
2average
4543.45
15223.61
19767.07
363.96
11277.595
80.4874
31044.66
1.0269
66.418 43.5821
64
1 2 3 4 5 6 7 8 9 10 110.00
100.00
200.00
300.00
400.00
500.00
600.00
700.00
800.00
900.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2001-02 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2009-10.
65
Sterlite Industries
Year
Share Capita
lReserv
eNet
Worth
Trend in Net
Worth Debt
Trend in Debt
Capital Employ
ed
Debt Equi
ty Rati
o%to Capital Employed
Net
worthDeb
t2001-
02 27.791383.2
5 1411.04100.0
01257.
46100.00 2668.50 0.89 52.88
47.12
2002-03 17.95
1236.04 1253.99 88.87
1727.45
137.38 2981.44 1.38 42.06
57.94
2003-04 35.90
1382.17 1418.07
100.50
2412.12
191.82 3830.19 1.70 37.02
62.98
2004-05 54.89
3502.97 3557.86
252.14
2439.50
194.00 5997.36 0.69 59.32
40.68
2005-06 55.87
4044.66 4100.53
290.60
2034.79
161.82 6135.32 0.50 66.83
33.17
2006-07 111.70
4346.23 4457.93
315.93
2809.75
223.45 7267.68 0.63 61.34
38.66
2007-08 141.70
13014.60
13156.30
932.38
3257.81
259.08
16414.11 0.25 80.15
19.85
2008-09 141.70
13897.32
14039.02
994.94
3830.04
304.59
17869.06 0.27 78.57
21.43
2009-10 168.08
22067.40
22235.48
1575.82
5322.20
423.25
27557.68 0.24 80.69
19.31
2010-11 336.12
22873.03
23209.15
1644.83
5760.94
458.14
28970.09 0.25 80.11
19.89
2011-12 336.12
24389.67
24725.79
1752.31
5330.23
423.89
30056.02 0.22 82.27
17.73
total28436.
9619456
3.7 223001 103717488
.51739
8240489.
21 13.61 953.53146.
5average
2843.696
19456.37 22300.1 103.7
1748.85 1740
24048.921 1.361 95.353
14.65
66
1 2 3 4 5 6 7 8 9 10 110.00
200.00
400.00
600.00
800.00
1000.00
1200.00
1400.00
1600.00
1800.00
2000.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2001-02 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2001-02 and 2005-06 and the highest was in year 2009-10.
67
Welspun Industries
Year
Share
Capital
Reserve
Net Worth
Trend in Net Worth Debt
Trend in Debt
Capital Emplo
yed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
02139.2
8 0.10 139.38 100.00 268.97100.0
0 408.35 1.93 34.1365.8
72002-
03140.7
3 1.64 142.37 102.15 277.37103.1
2 419.74 1.95 33.9266.0
82003-
04141.3
6 74.38 215.74 154.79 165.21 61.42 380.95 0.77 56.6343.3
72004-
05 75.64 217.21 292.85 210.11 384.67143.0
2 677.52 1.31 43.2256.7
82005-
06 86.53 408.26 494.79 354.99 802.70298.4
3 1297.49 1.62 38.1361.8
72006-
07 69.91 576.77 646.68 463.971514.6
3563.1
2 2161.31 2.34 29.9270.0
82007-
08 88.881400.5
9 1489.471068.6
41803.1
1670.3
8 3292.58 1.21 45.2454.7
62008-
09 93.251451.0
6 1544.311107.9
92173.7
4808.1
7 3718.05 1.41 41.5458.4
62009-
10102.1
62644.4
1 2746.301970.3
71978.9
6735.7
5 4725.26 0.72 58.1241.8
82010-
11102.3
32956.8
7 3059.202194.8
62662.4
7989.8
8 5721.67 0.87 53.4746.5
32011-
12113.8
93449.0
4 3562.932556.2
73365.0
71251.
09 6928.00 0.94 51.4348.5
7
total1153.
9613180.
3314334.0
210284.
1315396.
905724.
3929730.9
215.0
8485.75 614.
25average
115.396
1318.033
1433.402
1028.413
1539.69
572.44
2973.092
1.5075
48.57 61.425
68
1 2 3 4 5 6 7 8 9 10 110.00
500.00
1000.00
1500.00
2000.00
2500.00
3000.00
3500.00
4000.00
Trend in DebtTrend in Net Worth
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2009-10.
69
Jindal steel
Year
Share
Capital
Reserve
Net Worth
Trend in Net
Worth Debt
Trend in Debt
Capital Emplo
yed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
0212.90
452.23 465.13100.0
0 697.51100.0
0 1162.64 1.50 40.01 59.992002-
0314.63
558.18 572.81123.1
5 885.25126.9
2 1458.06 1.55 39.29 60.712003-
0415.40
839.80 855.20183.8
61025.9
6147.0
9 1881.16 1.20 45.46 54.542004-
0515.40 1302.9
8 1318.38283.4
41495.8
6214.4
6 2814.24 1.13 46.85 53.152005-
0615.40 1829.3
1 1844.71396.6
02745.3
7393.6
0 4590.08 1.49 40.19 59.812006-
0715.40 2481.3
3 2496.73536.7
83507.7
2502.8
9 6004.45 1.40 41.58 58.422007-
0815.40 3740.9
8 3756.38807.6
03863.3
5553.8
8 7619.73 1.03 49.30 50.702008-
0915.47 5399.8
5 5415.321164.
264962.6
5711.4
810377.9
7 0.92 52.18 47.822009-
1093.12 6652.8
8 6746.001450.
358383.2
61201.
8815129.2
6 1.24 44.59 55.412010-
1193.43 8594.1
2 8687.551867.
7712114.
671736.
8520802.2
2 1.39 41.76 58.242011-
1293.48 10751.
9310845.4
12331.
6914372.
462060.
5425217.8
7 1.33 43.01 56.99
total400.0
342603.
5943003.6
29245.
5154054.
067749.
5797057.6
814.1
8484.21 615.7
9average
40.003
4260.36
4300.362
924.55
5405.41
774.96
9705.77 1.418
48.4208 61.5792
70
1 2 3 4 5 6 7 8 9 10 110.00
500.00
1000.00
1500.00
2000.00
2500.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and the highest was in year 2011- 12 It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2009-10.
71
TELECOM INDUSTRIES
crompton greave
Year
Share
Capital
Reserve
Net Worth
Trend in Net
Worth Debt
Trend in Debt
Capital Employ
ed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
02 52.37 346.98 399.35100.0
0511.8
0100.00 911.15 1.28 43.83 56.17
2002-03 52.37 372.25 424.62
106.33
459.22
89.73 883.84 1.08 48.04 51.96
2003-04 52.37 272.12 324.49 81.25
333.65
65.19 658.14 1.03 49.30 50.70
2004-05 52.37 34.07 86.44 21.65 31.45 6.14 117.89 0.36 73.32 26.68
2005-06 52.37 468.77 521.14
130.50
249.77
48.80 770.91 0.48 67.60 32.40
2006-07 73.32 586.01 659.33
165.10
270.04
52.76 929.37 0.41 70.94 29.06
2007-08 73.32 842.67 915.99
229.37 87.56
17.11 1003.55 0.10 91.27 8.73
2008-09 73.32
1153.99 1227.31
307.33 53.67
10.49 1280.98 0.00 0.00 0.00
2009-10
128.30
1622.00 1750.30
643.11 26.78 5.23 1777.08 0.02 98.49 1.51
2010-11
128.30
2161.51 2289.81
841.35 13.40 2.62 2303.21 0.01 99.42 0.58
2011-12
128.30
2572.58 2700.88
992.39 2.26 0.44 2703.14 0.00 99.92 0.08
total866.7
110432.
9511299.6
63618.
372039.
60398.
5213339.2
6 4.76 742.15257.8
5avera
ge86.67
11043.2
95 1129.97361.8
37203.9
639.8
521333.92
60.476
274.2145
525.78
54
72
1 2 3 4 5 6 7 8 9 10 110.00
200.00
400.00
600.00
800.00
1000.00
1200.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2004-05 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2004-05 and 2005-06 and it is decreases.
73
ABB infrastructure
Year
Share
Capital
Reserve
Net Worth
Trend in Net
Worth Debt
Trend in
Debt
Capital Emplo
yed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
02 42.38 453.92 496.30100.0
0 12.37 100.00 508.67 0.02 97.57 2.432002-
03 42.38 546.16 588.54118.5
9 10.10 81.65 598.64 0.02 98.31 1.692003-
04 42.38 666.94 709.32142.9
2 1.49 12.05 710.81 0.00 99.79 0.212004-
05 42.38 846.67 889.05179.1
4 2.73 22.07 891.78 0.00 99.69 0.312005-
06 42.389138.6
5 9181.031849.
90 1.55 12.53 9182.58 0.00 99.98 0.022006-
07 42.381569.4
9 1611.87324.7
81626.9
113152.
06 3238.78 1.01 49.77 50.232007-
08 42.382062.2
9 2104.67424.0
72118.9
717129.
91 4223.64 1.01 49.83 50.172008-
09 42.382367.3
5 2409.73485.5
42423.7
319593.
61 4833.46 0.00 0.00 0.002009-
10 42.382381.3
2 2423.70890.5
42423.7
019593.
37 4847.40 1.00 50.00 50.002010-
11 42.382492.1
4 2534.52931.2
62534.5
220489.
25 5069.04 1.00 50.00 50.002011-
12 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
total423.8
022524.
9322948.7
35446.
7311156.
0790186.
5034104.8
0 4.06 694.95205.0
5avera
ge 42.382252.4
92294.87
3544.6
731115.6
19018.6
5 3410.480.40
64 69.494720.50
53
74
1 2 3 4 5 6 7 8 9 10 110.00
5000.00
10000.00
15000.00
20000.00
25000.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2001-02 and the highest was in year 2011-12. It shows the continuous up and down every year. The lowest trend in debt was in year 2001-02 and 2005-06 and it continous increases but in year 2011 it slopes downward direction.
75
VIDEOCON
Year
Share
Capital
Reserve
Net Worth
Trend in Net Worth Debt
Trend in
Debt
Capital
Employed
Debt Equit
y Ratio
%to Capital Employed
Net
worthDeb
t
2001-02 18.16 -20.37 -2.21 100.00
262.97
100.00 260.76
-118.9
9 -0.85100.85
2002-03 32.89 -39.48 -6.59 298.19
119.96 45.62 113.37
-18.20 -5.81
105.81
2003-04 32.89 -41.21 -8.32 376.47 90.07 34.25 81.75
-10.83 -10.18
110.18
2004-05
206.53
3420.56 3627.09
-164121.
723249.
571235.
726876.6
6 0.90 52.7447.2
6
2005-06
266.85
3847.63 4114.48
-186175.
574961.
191886.
609075.6
7 1.21 45.3454.6
6
2006-07
266.95
5357.91 5624.86
-254518.
555259.
642000.
0910884.
50 0.94 51.6848.3
2
2007-08
275.31
6538.49 6813.80
-308316.
748005.
593044.
3014819.
39 1.17 45.9854.0
2
2008-09
275.42
6929.63 7205.05
-326020.
369084.
553454.
6016289.
60 0.00 0.00 0.002009-
10347.9
69085.
92 9433.88 3466.3011773
.774477.
2321207.
65 1.25 44.4855.5
22010-
11333.9
49619.
04 9952.98 3657.0318656
.027094.
3528609.
00 1.87 34.7965.2
12011-
12 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
total2056.
9044698
.1246755.0
2
-1231254
.9561463
.3323372
.75108218
.35
-140.6
9 258.17641.
83
average
205.69
4469.81
4675.502
-123125.
496146.
3332337.
2810821.
835
-14.06
8625.817
264.1
83
76
1 2 3 4 5 6 7 8 9 10 11
-350000.00
-300000.00
-250000.00
-200000.00
-150000.00
-100000.00
-50000.00
0.00
50000.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and its moves downward as negative impact every year. It shows the continuous decrease every year. The lowest trend in debt was in year 2001--02 and there is no effect .its continuous increseases by year.
77
Siemans
Year
Share Capit
alReserv
eNet
Worth
Trend in Net Worth
Debt
Trend in Debt
Capital Employ
ed
Debt Equit
y Ratio
%to Capital Employed
Net
worthDeb
t2001-
02 33.14 0.00 33.14 100.00 6.40100.0
0 39.54 0.19 83.8116.1
92002-
03 33.14 457.91 491.051481.7
4 3.10 48.44 494.15 0.01 99.37 0.632003-
04 33.14 573.02 606.161829.0
9 2.89 45.16 609.05 0.00 99.53 0.472004-
05 33.14 747.62 780.762355.9
4 2.57 40.16 783.33 0.00 99.67 0.332005-
06 33.721051.8
01085.5
23275.5
6 2.00 31.25 1087.52 0.00 99.82 0.182006-
07 33.721555.6
81589.4
04796.0
2 1.53 23.91 1590.93 0.00 99.90 0.102007-
08 67.43 200.25 267.68 807.72 1.06 16.56 268.74 0.00 99.61 0.392008-
09 67.432847.8
72915.3
08796.9
2 0.59 9.22 2915.89 0.00 99.98 0.022009-
10 67.433409.1
13476.5
410490.
46 0.24 3.75 3476.78 0.00 99.99 0.012010-
11 68.063746.9
83815.0
411511.
89 0.00 0.00 3815.04 0.00 100.00 0.002011-
12 68.103892.2
03960.3
011950.
21 0.00 0.00 3960.30 0.00 100.00 0.00
total538.4
518482.
4419020.
8957395.
5620.3
8318.4
419041.2
7 0.211081.6
818.3
2avera
ge53.84
51848.2
441902.0
895739.5
562.03
831.84
4 1904.130.021
5108.16
81.83
2
78
1 2 3 4 5 6 7 8 9 10 110.00
2000.00
4000.00
6000.00
8000.00
10000.00
12000.00
14000.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2001-02 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and was in stable by all year
79
idea cellular
Year
Share Capit
alReser
veNet
Worth
Trend in Net Wort
h Debt
Trend in Debt
Capital Emplo
yed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt
2001-02
2016.69
-1299.
87 716.82 100.001510.5
1100.0
0 2227.33 2.11 32.1867.8
2
2002-03
2526.53
-1547.
18 979.35 136.621795.3
0118.8
5 2774.65 1.83 35.3064.7
0
2003-04
2742.53
-1719.
90 1022.63 142.662263.5
4149.8
5 3286.17 2.21 31.1268.8
8
2004-05
2742.53
-1695.
74 1046.79 146.032698.0
3178.6
2 3744.82 2.58 27.9572.0
5
2005-06
2742.53
-1574.
00 1168.53 163.022915.6
0193.0
2 4084.13 2.50 28.6171.3
9
2006-07
2592.86
-913.7
1 1679.15 234.254250.5
1281.4
0 5929.66 2.53 28.3271.6
82007-
082635.3
6906.9
1 3542.27 494.166514.7
6431.3
010057.0
3 1.84 35.2264.7
82008-
093100.1
08176.
0 11276.11573.0
97579.3
6501.7
718855.5
5 0.67 59.8040.2
0
2009-10
3299.84
8112.9 11412.7
1592.14
6526.42
432.07
17939.21 0.57 63.62
36.38
2010-11
3308.27
8979.6 12287.8
1714.22
10557.4
698.93
22845.35 0.86 53.79
46.21
2011-12
3308.85
9590.7 12899.6
1799.56
10138.1
671.18
23037.77 0.79 55.99
44.01
total31016.
0927015
.9 58032.08095.7
656749.
63756.
99114781.
6718.4
9 451.91648.
09avera
ge3101.6
092701.
595803.20
1809.57
585674.9
66375.6
9911478.1
671.84
86 45.19164.8
09
80
1 2 3 4 5 6 7 8 9 10 110.00
200.00
400.00
600.00
800.00
1000.00
1200.00
1400.00
1600.00
1800.00
2000.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2001-02 and the highest was in year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2008-09 and the highest was in year 2010-111
81
reliance communication
YearShare
Capital ReserveNet
Worth
Trend in Net Worth Debt
Trend in Debt
Capital Employe
d
Debt Equit
y Ratio
%to Capital Employed
Net
worth Debt2004-
05 0.01 0.00 0.01 0.00 0.00 100.00 0.00 0.00 0.00 0.002005-
06 0.05 14783.43 14783.48 100.00 0.00 0.00 14783.48 0.00 100.00 0.002006-
07 1022.31 19503.23 20525.54 138.84 14567.84 100.00 35093.38 0.71 58.49 41.512007-
08 1032.00 23808.02 24840.02 168.03 20286.43 139.25 45126.45 0.82 55.05 44.952008-
09 1032.00 50658.32 51690.32 349.65 30903.61 212.14 82593.93 0.60 62.58 37.422009-
10 1032.00 49466.88 50498.88 341.59 24478.28 168.03 74977.16 0.48 67.35 32.652010-
11 1032.00 47112.47 48144.47 325.66 31452.74 215.91 79597.21 0.65 60.49 39.512011-
12 1032.00 44165.00 45197.00 305.73 27871.00 191.32 73068.00 0.62 61.86 38.14
total 6182.37 249497.35 255679.72 1729.50 149559.90 1126.64 405239.61 3.88 465.81 234.19
average 618.237 24949.735 25567.97 172.95 14955.99 112.6644 40523.96 0.388 46.5811 23.4189
82
1 2 3 4 5 6 7 80.00
50.00
100.00
150.00
200.00
250.00
300.00
350.00
400.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2001-02 and the highest was in year 2005-6. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and the highest was in year 2007-08.It is change the slope up and down.
83
bharat heavy electrical ltd
Year
Share Capit
alReserv
eNet
Worth
Trend in Net
Worth Debt
Trend in Debt
Capital Employ
ed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
02244.7
6 4224.85 4469.61100.0
0665.7
8100.00 5135.39 0.15 87.04
12.96
2002-03
244.76 4558.91 4803.67
107.47
531.09
79.77 5334.76 0.11 90.04 9.96
2003-04
244.76 5051.18 5295.94
118.49
540.03
81.11 5835.97 0.10 90.75 9.25
2004-05
244.76 5782.13 6026.89
134.84
536.98
80.65 6563.87 0.09 91.82 8.18
2005-06
244.76 7056.62 7301.38
163.36
558.24
83.85 7859.62 0.08 92.90 7.10
2006-07
244.76 8543.50 8788.26
196.62 89.33
13.42 8877.59 0.01 98.99 1.01
2007-08
489.52
10284.69
10774.21
241.05 95.18
14.30
10869.39 0.01 99.12 0.88
2008-09
489.52
12449.29
12938.81
289.48
149.37
22.44
13088.18 0.01 98.86 1.14
2009-10
489.52
15427.84
15917.36
356.12
127.75
19.19
16045.11 0.01 99.20 0.80
2010-11
489.52
19664.32
20153.84
450.91
163.35
24.54
20317.19 0.01 99.20 0.80
2011-12
489.52
24883.69
25373.21
567.68
123.43
18.54
25496.64 0.00 99.52 0.48
total3916.
16117927.
02121843.
182726.
043580.
53537.
79125423.
71 0.58 1047.4452.5
6avera
ge391.6
2 11792.712184.3
18272.6
04358.0
5353.7
7912542.3
70.057
9 104.7445.25
64
84
1 2 3 4 5 6 7 8 9 10 110.00
100.00
200.00
300.00
400.00
500.00
600.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2001-02 and it is continous increase by the year 2011-12. It shows the continuous increase every year. The lowest trend in debt was in year 2002-03 and 2005-06 and it decrease every year.
85
BhartiAirtel
Year
Share Capita
l ReserveNet
Worth
Trend in
Net Wort
h Debt
Trend in
Debt
Capital Employ
ed
Debt Equi
ty Rati
o%to Capital Employed
Net
worth Debt2001-
0218533.
372970.9
021504.
27100.0
0 100.52 100.0021604.
79 1.00 99.53 0.472002-
031853.3
72971.1
24824.4
9 22.44 1.19 1.184825.6
8 1.00 99.98 0.022003-
041853.3
72971.4
94824.8
6 22.44 626.36 623.125451.2
2 1.13 88.5111.4
92004-
051853.3
72675.3
84528.7
5 21.064994.2
94968.4
59523.0
4 2.10 47.5652.4
42005-
061893.8
85437.4
27331.3
0 34.095796.2
95766.3
113127.
59 1.79 55.8544.1
52006-
072.00 9515.2
19517.2
1 44.265310.8
15283.3
414828.
02 1.56 64.1835.8
22007-
08489.52 18283.
8218773.
34 87.30 95.18 94.6918868.
52 1.01 99.50 0.502008-
09489.52 25627.
3826116.
90121.4
5 149.37 148.6026266.
27 1.01 99.43 0.572009-
10489.52 34650.
1935139.
71163.4
1 127.75 127.0935267.
46 1.00 99.64 0.362010-
11489.52 41932.
1042421.
62197.2
7 163.35 162.5042584.
97 1.00 99.62 0.382011-
12489.52 47528.
7048018.
22223.3
0 123.43 122.7948141.
65 1.00 99.74 0.26
total28436.
96194563
.71223000
.671037.
0117488.
5417398.
07240489
.2113.6
1 953.53146.
47avera
ge 2843.719456.
3722300.
07103.7
011748.8
51739.8
124048.
9211.36
1 95.3514.6
47
86
1 2 3 4 5 6 7 8 9 10 110.00
1000.00
2000.00
3000.00
4000.00
5000.00
6000.00
7000.00
Trend in Net WorthTrend in Debt
Interpretation:
The above chart shows that the lowest trend in equity was in year 2002-03 and 2011-12and the highest was in year 2011 at very less amount. It shows the up and down between start and ending year . The lowest trend in debt was in year 2001-02 and it increase in year 2005 and its continuous decrease by ending years 2011-12.
87
Summary Statistics Across Industries
Automobile Industry(N=8)Trend in Equity(Average)
Trend in Debt(Average)
1. Tata motors 403.27 335.66
2. Larsen& turbo 293.99 165.18
3. MarutiSuzuki 262.094 68.85
4. Mahindra & Mahindra 310.35 127.94
5. Ashok Leyland 192.791 163.218
6. Tvs motors 285.85 340.82
7. Bajaj motors 57.94 52.87
8. Exide industry 1033.33 46.25
Telecom industry(N=7)
1. Bhartiairtel 103.7 1739.8072. Reliance
communication 172.94 112.66
3. Idea cellular 809.57 375.69
4. Siemens 5739.55 31.84
5. Videocon industry -123125.4 2337.275
6. Crompton greave 361.83 39.851
7. Bhel 272.6 53.77
Steel and aluminum industry(N=13)
1.Tata steel 562.94 317.362.Hindalco 387.34 697.913.Jsw 403.6 137.624.Sterlite industries 103.7006 1739.8095.Essar steels 151.94 116.076.Hindustan zinc 1036.5 5352.0747.Jindal steels 924.55 774.958.Jindal saw 672.92 487.99.Welspun 1628.412 572.4310.Jindal stainless 346 545.2211.Bhushan steel 5408 1185.7412.National aluminum 219.199 22.9113.Uttam galva 511.33 487.9
88
Steel and aluminum industry
1 2 3 4 5 6 7 8 9 10 11 12 130
1000
2000
3000
4000
5000
6000
Trend in Equity(Average)Trend in Debt(Average)
Interpretation
In this table in show the various trend of net equity and trend of debt averages. In this the trend of equity are up and down, it means the borrowing are and net equity of the firms are very less in year 2002 to 2009 but in year 2011 in increases high and in the year 2012 it decreses very low.but in the case of trend in debt its very less liabilities an starting year but in year 2006 it increase at very huge amount and in year 2012 it stable .
89
Telecom industry
1 2 3 4 5 6 7
-140000
-120000
-100000
-80000
-60000
-40000
-20000
0
20000
Trend in Equity(Average)Trend in Debt(Average)
Interpretation
This chart shows the various trends of net worth and the debt equity .the average trend of net equity is iscontinuous decrease by -120000 and the debt equity is stable by year according. There is minor up and down in debt equity.There is no change in trend in debt.
Aluminum industry
90
1 2 3 4 5 6 70
50
100
150
200
250
300
350
400
Trend in Equity(Average)Trend in Debt(Average)
Interpretation:
In this table it shows the trends in debt are change and the trend in equity are change during the time. the trend in equity are continuous decreases and the amount of trend in debt are changes means the lending power are increases.There are various ups and down of various firms of the steel and the aluminum companies. So the averages show the pattern of the various companies.
Average of different industries
91
Industries Trend in Equity(Average) Trend in Debt(Average)
steel &aluminum 950.49 956.761
automobile industries 354.951875 162.5985
telecom industries -16523.60143 670.1275714
steel &a-luminum
automobile industries
telecom industries
-20000
-15000
-10000
-5000
0
5000
Trend in Debt(Average)Trend in Equity(Average)
Interpretation:
The above line chart shows that telecom industry is having the overall lowest average of trend in net worth or equity i.e. -16523.60142 and the highest is of steel &aluminum Industry i.e. 950.49, but on the other hand the lowest average of the trend in debt is of automobile Industry i.e. 162.5985 and the highest average is of the steel &aluminum Industry is 956.76.
92
DEBT EQUITY RATIO FOR AUTOMOBILE INDUSTRY COMPANIES
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-2010
2010-11
2011-12
Tata motors
0.936
0.562
0.351
0.607
0.533
0.586
0.804
1.064 1.125
0.795
0.569
Larsen turbo
1.073
0.614
0.483
0.557
0.315
0.362
0.355
0.527 0.372
0.334
0.393
Maruti Suzuki
0.242
0.147
0.087
0.070
0.013
0.093
0.107
0.075 0.069
0.022
0.071
M&M0.92
60.73
30.41
00.52
70.30
50.46
20.59
60.77
5 0.3690.23
40.26
2Ashok Leyland
0.879
0.768
0.486
0.770
0.500
0.342
0.417
0.931 0.982
1.001
0.826
TVS motors
0.516
0.288
0.207
0.275
0.503
0.783
0.811
1.114 1.159
0.393
0.612
Bajaj motors
0.000
0.000
0.000
0.000
0.308
0.294
0.061
0.174 0.457
0.320
0.221
Honda seil cars
0.058
0.051
0.086
0.069
0.000
0.000
0.000
0.000 0.000
0.000
0.000
Exide industry
3.143
0.951
0.594
0.676
0.575
0.517
0.354
0.260 0.041
0.079
0.000
TOTAL7.77
44.11
42.70
33.55
23.05
23.43
93.50
64.92
0 4.5753.17
82.95
5
AVERAGE
0.864
0.457
0.300
0.395
0.339
0.382
0.390
0.547 0.508
0.353
0.328
Interpretation
In this table we show the debt equity ratios of automobile industries. There are various firms in which we show different ratios and the averages of all the firms. A debt equity ratio generally means that a company has been aggressive its growth with debt. This can result in volatile earnings as a result of the additionalexpense. In this table it show the various debt ratio which increase the finance of the companies. The cost of debt financing may outweighs the return that the company generates on the debt through investments.ashok Leyland have much more finances compare to the other firms.
93
DEBT EQUITY RATIO FOR TELECOM INDUSTRYCOMPANIES
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-2010
2010-11
2011-12
bhartiairtel 1.0051.00
01.13
02.10
31.79
11.55
81.00
51.00
6 1.0041.00
41.00
3bharti heavy electrical limited 0.149
0.111
0.102
0.089
0.076
0.010
0.009
0.012 0.008
0.008
0.005
Reliance 0.00
00.00
00.71
00.81
70.59
8 0.4850.65
30.61
7siemans industries 0.193
0.006
0.005
0.003
0.002
0.001
0.004
0.000 0.000
0.000
0.000
videocon
-11.99
1
-18.2
03
-10.8
260.89
61.20
60.93
51.17
50.00
0 1.2481.87
40.00
0ABB infrastructure 0.025
0.017
0.002
0.003
0.000
1.009
1.007
0.000 1.000
1.000
0.000
crompton grease 1.282
1.081
1.028
0.364
0.479
0.410
0.096
0.000 0.015
0.006
0.001
idea cellular 2.107
1.833
2.213
2.577
2.495
2.531
1.839
0.672 0.572
0.859
0.786
TOTAL
-114.2
30
-14.1
54
-6.34
56.03
56.04
97.16
45.95
12.28
7 4.3325.40
52.41
1
AVERAGE
-14.27
9
-1.76
9
-0.79
30.75
40.75
60.89
60.74
40.28
6 0.5410.67
60.30
1
In this table we show the debt equity ratios of telecom industries. There are various firms in which we show different ratios and the averages of all the firms. A debt equity ratio generally means that a company has been aggressive its growth with debt. This can result in volatile earnings as a result of the additional expense. In this table it show the various debt ratio which increase the finance of the companies. The cost of debt financing may outweighs the return that the company generates on the debt through investments. Crompton grease have much more finances or debt ratiocompare to the other firms.
94
DEBT EQUITY RATIO FOR STEEL & ALUMINUM INDUSTRY COMPANIES
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-2010
2010-11
2011-12
Sail2.58
02.26
11.72
50.56
00.34
10.21
30.13
20.26
9 1.2400.54
40.40
4
tata steels1.36
61.32
70.74
70.38
80.25
80.69
10.66
00.90
7 0.6794.97
40.45
4
hindalco0.20
90.38
70.37
40.49
60.51
00.59
30.48
20.35
0 0.2280.24
5 0.46
JSW2.95
10.03
83.22
61.33
61.00
50.78
81.02
11.47
0 1.2290.72
80.68
0sterlite industry
0.891
1.378
1.701
0.686
0.496
0.630
0.248
0.273 0.239
0.248
0.216
essar steels3.06
812.2
847.86
33.77
64.37
11.64
51.33
31.55
7 2.0090.00
00.00
0hindustan zinc
0.004
0.001
0.403
0.275
0.221
0.000
0.000
0.001 0.003
0.000
0.000
jindal steels1.50
01.54
51.20
01.13
51.48
81.40
51.02
80.91
6 1.2431.39
41.32
5
jindal saw0.82
90.64
11.50
61.20
71.37
60.58
50.70
50.00
0 0.2030.40
10.70
0
welspun1.93
01.94
80.76
61.31
41.62
22.34
21.21
11.40
8 0.7210.87
00.94
4jindal stainless
0.000
2.010
1.373
1.699
2.174
1.895
2.399
4.371 3.934
3.769
4.236
bhushan steels
1.301
1.547
1.581
1.803
2.289
2.669
3.518
3.977 2.857
3.133
2.679
national aluminum
0.485
0.400
0.174
0.000
0.000
0.000
0.000
0.000 0.000
0.011
0.000
uttamgalva3.07
82.92
72.61
01.91
92.49
71.78
91.47
41.71
2 2.2762.25
01.96
8
TOTAL20.1
9028.6
9525.2
4916.5
9318.6
4715.2
4614.2
1217.2
12 16.86118.5
6914.066
AVERAGE
1.442
2.050
1.804
1.185
1.332
1.089
1.015
1.229 1.204
1.326
1.005
In this table we show the debt equity ratios of steel and aluminum industries. There are various firms in which we show different ratios and the averages of all the firms. A debt equity ratio generally means that a company has been aggressive its growth with debt. This can result in volatile earnings as a result of the additional expense. In this table it show the various debt ratio which increase the finance of the companies. The cost of debt financing may outweighs the return that the company generates on the debt through investments. Essar steel have much more finances or debt ratio compare to the other firms. As the ratio is decreases by year to year.
95
DEBT EQUITY OF DIFFERENT INDUSTRIES ANNUAL AVERAGE
YEARS2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-2010
2010-11
2011-12
INDUSTRIES Automobile industry
0.864
0.457
0.300
0.395
0.339
0.382
0.390
0.547 0.508
0.353
0.328
Telecom industry
-14.2
79
-1.76
9
-0.79
30.75
40.75
60.89
60.74
40.28
6 0.5410.67
60.30
1Steel aluminum industry
1.442
2.050
1.804
1.185
1.332
1.089
1.015
1.229 1.204
1.326
0.972
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-
2010
2010-11
2011-12
-16
-14
-12
-10
-8
-6
-4
-2
0
2
4
YEARSautomobile indusrtytelecom industrysteel&aluminum industry
Interpretation
This table and the chart show different annual averages of different industries. The chart show
different annual averages of three industries at year 2002-2012.this chart show the trend of
telecom industries automobile and steel it goes downward means as negative. While
automobile and steel and aluminum industries are between the 0 – 2 ratios, it means the
financing pattern the othern industries are high then telecom industry.
96
Chapter – 5
Findings, Suggestions &
Conclusion
97
FINDINGS, SUGGESTIONS & CONCLUSION
Automobile induResults and findings
As per the research in automobile industry the Exide industry has more net worth as compare
to the other industries and the debt trends is less
In Larsen& turbo we find that it should be changes between the pattern of the financing that
it will increase their ratios
We observed that TVS motors there is increase in net worthanddecrease the debt trends
We find that in Maruti Suzuki there is huge differences in average of net trend and debt
trends
In telecom industry we find that that it is negative impact on Videocon industry by the net
worth and debt ratio is almost equal.
The siemans industry has highest net worth as compare to the other industries and the debt
worth is lowest as compare to the net worth
The average trends of steels and aluminum companies is highest to the telecom industry
The telecom industry is go downward as compare to the steel and aluminum and automobile
industries
The welspun industries has highest net worth and the debt worth as compare to the other
firms of steel and aluminum companies
The overall finding that the telecom industries should improve their net worth and the debt
ratio that it will reach their targets
The net worth and the debt ratio and debt worth of steel and aluminum companies
is higher then telecom and the automobiles industries.
The telecom industry has very less ratio as compare to the increase her industries.
So it should improve or increases the financing ratio.
The automobile industry has also less average ratio as compare to the steel and
aluminum company.
Suggestions
98
The telecom industry should pay attention on the overall capital of the companies
that it will reach their targets.
The average of the automobile industries is less than to steel and aluminum
industry and automobile industry should concentrate on reserves and surpluses
and it should increase their efficiency
The financing pattern of steel and aluminum industry is more then automobile
and telecom industry as can see in the tables. so steel and aluminum industry
should stay and increase their worth.
Conclusions
This study investigated the financing patterns of different industries. The research is
based on different industries such as steel, aluminum, telecom and the automobile
industries.In particular, this paper examined financing patterns over time and explored
potential differences ,various trends of industries, averages of industries that to calculate
the financing trend. In I research the net equity trends and the debt trends from year
2002 to year2012 .We investigate that how firm financing patterns differ around the
industry for one industry to another industry. Using a unique firm-level survey database
in various industries, we find that firm size, financial development and trends ,averages
of different firms .patterns that are important factors in explaining the observed variation
in financing patterns.. We examine broader spectrum of external financing sources
which only includes debt and equity finance and in is helpful to study the trends of
financing pattern of different industries.
99
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www.indiabudget.nic.in.
www.nseindia.com.
www.googlesearch.com
www.yahoo.com
www.wikipedia.com
101