Date : 21/01/2014 SYNOPSIS (EXECUTIVE SUMMARY)

Analysis of Asian Paints using Ratio analysis

Objective: To study various types of financial ratios and analyze the performance of Asian Paints as a company and also with respect to its peers. Methodology: The research will be carried on using secondary data such as annual reports, etc from company website and other sources. Summary: Ratio Analysis is one of the techniques of financial analysis where ratios are used as a yardstick for evaluating the financial condition and performance of a firm. The absolute accounting figures reported in the financial statements do not provide a meaningful understanding of the performance and financial position of a firm. An accounting figure

conveys meaning when it is related to some other relevant information. Analysis and interpretation of various accounting ratios gives a better understanding of financial condition and performance of firm. Trend ratios indicate the direction of change in the performance improvement, deterioration or constancy- over the year. It is also used for analyzing the financial statement of industrial concerns. Now a day this technique is sophisticated and is commonly used in business concerns. Ratio analysis is not an end but it is only means of better understanding of financial strength and weakness of a firm. Ratios are proved as the basic instrument in the control process and act as back bone in schemes of the business forecast. Standards of comparison: The ration analysis involves comparison for a useful interpretation of the financial statements. A single ratio in itself does not indicate favorable or unfavorable condition. It should be compared with some standard. Standards of comparison may consist of: Past ratios, i.e. ratios calculated form the past financial statements of the same firm Competitors ratios, i.e., of some selected firms, especially the most progressive and successful competitor, at the same pint in time Industry ratios, i.e. ratios of the industry to which the firm belongs

Company Details: Asian Paints Ltd. The Company was incorporated as a private limited company under the name of Asian Oil and Paint Company Pvt. Ltd. It was converted into a public limited company in 1973. The Company manufactures a wide range of surface coatings catering to different end-uses. The company expanded its products range, developed its own technology, set up a distribution network penetrating in smaller towns and ploughed back a large part of earnings into creation of new facilities. The name was changed from Asian Oil and Paint Company Pvt. Ltd. to Asian Paints (India) Pvt. Ltd. Asian Paints operates in 22 countries across the world. It has manufacturing facilities in each of these countries and is the largest paint company in ten overseas markets. Asian Paints operates in five regions across the world viz. South Asia, Southeast Asia, South Pacific, Middle Eastand Caribbean region through the various corporate brands such as Asian Paints, SCIB Paints, Apco Coatings and Taubmans. In ten markets, it operates through its subsidiary, Berger International Limited; in Egypt through SCIB Paints; in five markets in the South Pacific it operates through Apco Coatings and in Fiji and Samoa it also operates through Taubmans. In October 2008 the company acquired Sri Lanka's second largest paint company, spending nearly about Rs 360 million ($8 million) for this deal. The Consolidated Net Revenue from Operations increased to Rs. 9,632.24 crores from Rs. 7722.30 crores - growth of 24.7 %. Net profit after minority interest for the group for the current year is Rs. 988.73 as against Rs. 843.24 crores in the previous year - a growth of 17.3%. Thus, this project will help to understand the financial stability and soundness of Asian Paints and to assess and evaluate the earning capacity of the business. It will help to estimate and evaluate the fixed assets, stock etc. and determine the possibilities of future growth of business. Bibliography & list References: 1. 2. 3. 4. 5. www.asianpaints.com en.wikipedia.org/wiki/Asian_Paints www.moneycontrol.com/india/stockpricequote/paintsvarnishes/asianpaints/AP31 www.demonstratingvalue.org/resources/financial-ratio-analysis www.prenhall.com/divisions/bp/app/cfl/RA/RatioAnalysis.html