8/11/2019 Terms and Their Meanings

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1) Operating Profit & OPM

Operating Profit gives an indication of the current operational profitability of the business and

allows a comparison of profitability between different companies after removing out expenses

that can obscure how the company is really performing.

Interest cost depends on the management's choice of financing, tax can vary widely dependingon acquisitions and losses in prior years, and depreciation and amortization policies may differ

from company to company.

2) EBITDA, PBT & PAT

EBITDA is an acronym for Earnings Before Interest, Taxes, Depreciation, and Amortization.

PBT stands for Profit Before Tax, and PAT stands for Profit After Tax.

The graph visually shows how the net profit of the company stand reduced due to the impact of

Interest, Depreciation, and Tax.

3) Total Assets & Asset Turnover Ratio

Total Assets is the sum of all assets, current and fixed. The asset turnover ratio measures the

ability of a company to use its assets to efficiently generate sales. The higher the ratio indicates

that the company is utilizing all its assets efficiently to generate sales. Companies with low profit

margins tend to have high asset turnover.

4) Net Sales

Sales is the total amount of products or services sold by the company.

5) EBITDA

EBITDA is an acronym for Earnings Before Interest, Taxes, Depreciation, and Amortization.

It gives an indication of the current operational profitability of the business and allows a

comparison of profitability between different companies after removing out expenses that can

obscure how the company is really performing.

6) Profit Before Tax

Profit before tax deducts all expenses from revenue including interest expenses and operating

expenses, excluding tax. Since taxes change every year, PBT gives investors a good idea

about the company profits every year.

7) Profit After Tax

Profit after tax, also referred as the bottom-line, is a measure of the profitability of the company

after deducting all its expenses.

8) Networth

Networth is the difference between a company's total assets and its total liabilities. It is also

known as shareholder`s equity.

8/11/2019 Terms and Their Meanings

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9) Return On Capital Employed %

Capital Employed is defined as total assets less current liabilities. Return On Capital Employed

is a ratio that shows the efficiency and profitability of a company's capital investments. The

ROCE should always be higher than the rate at which the company borrows money.

10) Gross Block

Fixed assets are long-term tangible piece of property that the company owns and uses in the

production of its income. Gross Block is the cost of fixed assets eg buildings, real estate,

equipment, furniture etc not excluding the depreciation amount charged on it.

11) Dividend

Dividend is a payment made by a company to its shareholders usually as a distribution of

profits. When a company makes profit it can either re-invest it in the business or it distribute it to

its shareholders by way of dividends. The dividend payout ratio is the amount of dividends paidto shareholders relative to the amount of total net profit of a company.

A reduction in dividends paid is not appreciated by investors and usually the stock price moves

down as this could point towards difficult times ahead for the company. On the other hand a

stable dividend payout ratio indicates a solid dividend policy by the company's management.

12) Book Value (Rs)

Book value is a company's assets minus its liabilities. In simple terms it would be the amount of

money that a share holder would get if a company were to liquidate.

Report on Corporate Governance- starts from Page 46-47, Include the Profile of Directors- Well

qualified, experience etc (http://www.adhunikgroup.com/about_us/directors.html ) , Their

attendance in AGM, Board meetings etc

Auditors Report- starts from Page 66-67,

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