Name: Talha

Id: 0120
Date 19-05-2017
Assignment No .02 And 03
Fauji Cross Time Series
COMPANY NAME Engro Chemicals Ltd. Fertilizer sectiona
Co. l

YEARS 2005 2006 2007 2007 2007 2005 to 2007

CURRENT RATIOS 1.79 1.56 3.11 0.942 Good Good

ACID TEST RATIO 1.10 1.31 0.26 0.89 Poor Poor

DEBT RATIO .48 .25 .18 0.57 Poor Poor

TIME INTEREST Poor Poor

EARNED 12.5 7.18 8.92 12.22

INVENTORY TURN Good Ok

OVER RATIO 11.1 9.4 10.1 22.95

Ok Ok
NET FIXED ASSETS
TURNOVER RATIO 1.4437 1.5148 1.9397 1.54

TOTAL ASSET Ok Good

Turnover RATIO 1.30 1.1 1.45 1.45

RECEIVABLES Ok Good
TURNOVER RATIO 34.3 30.2 22.8 19
 Name: Talha
Id: 0120
Date 19-05-2017
Assignment No .02 And 03

Average Collection Ok Good

Period 11 12 16 18.95

Gross Profit Poor Good

Margin (%) 14.45 24.07 21.22 35.6

Operating Profit Poor Ok

MARGIN (%) 19.15 21.63 20.58 29.93

Net Profit Margin Poor Ok

(%) 12.69 14.47 13.61 18.86

Earnings per share Good Good

(Rs./Share) 14.37 15.47 17.17 10.86

Time Time Series Interpretation

COMPANY NAME Engro Chemicals Ltd.
Series

YEARS 2005 2006 2007 2005 to 2007

CURRENT RATIOS Good The current ratio increase from 1.79 to 3.11 in 2007 which mea
1.79 1.56 3.11
.3.11/- current asset against its current liability Whi

Quick RATIO 1.10 1.31 0.26 Poor The quick ratio decrease from 1.10 to 0.26 in 2007 which mean
 Name: Talha
Id: 0120
Date 19-05-2017
Assignment No .02 And 03

0.26/- quick asset against its current liability Whic

DEBT RATIO Poor Debt ratio decrease from 48% to 18% .which means that co
.48 .25 .18
liabilities on its total assets

TIME INTEREST Poor It means that company can paid 12.5 interest from its profit in
EARNED 12.5 7.18 8.92
8.92 time

INVENTORY TURN Ok It means circle of the inventory in 2005 is 11 time which is de

OVER RATIO 11.1 9.4 10.1

TOTAL ASSET Good It means that they generate sale through their asset which Rs. 1
Turnover RATIO 1.30 1.1 1.45
sale in 2005 which increase to Rs .1.45

RECEIVABLES Good The receivable turnover ratio is decrease 34.3

TURNOVER RATIO 34.3 30.2 22.8

Average Good Average collection period is 11 days in 2005 which also i

Collection 11 12 16
Period

Gross Profit Good Gross profit margin in 2005 is 14.45% which decrease
Margin (%) 14.45 24.07 21.22

Operating Ok Operating profit margin in 2005 is 19.15% which is increase in

Profit MARGIN 19.15 21.63 20.58 decline 20.58%
(
 Name: Talha
Id: 0120
Date 19-05-2017
Assignment No .02 And 03

Net Profit Ok Net profit margin in 2006 is 12.69 % which is increase in 2006
Margin (%) 12.69 14.47 13.61
13.61%

Earnings per Good Earnings per share increase 14.37 to 17.17 in

share 14.37 15.47 17.17

Engro Fauji Cross Interpretation Cross sectional Analysis engro

COMPANY NAME Chemicals Fertilizer sectional
Ltd. Co.

YEARS 2007 2007 2007

CURRENT RATIOS 3.11 0.942 Good Current ratio of engro chemical is srong which is 3.11 than fua

Quick RATIO 0.26 0.89 Poor Quick ratio of fauji fertilizer is better which is 0.89 than the en

DEBT RATIO Poor Debt ratio of engro is 18% of its total asset which show goo
.18 0.57
fauji which is 57%

TIME INTEREST Poor Fuaji fertilizer can paid 12 time interest as compare to engro
EARNED 8.92 12.22
times

INVENTORY TURN Good Inventory turnover ratio of fauji fertilizer is high 22.95 as comp
OVER RATIO 10.1 22.95

Ok Both company net fixed asset turnover as almost same which 2

NET FIXED ASSETS
TURNOVER RATIO 1.9397 1.54

TOTAL ASSET 1.45 1.45 Ok Both company total asset turnover ratio are same which is 1.45
 Name: Talha
Id: 0120
Date 19-05-2017
Assignment No .02 And 03

Turnover RATIO

RECEIVABLES Ok Receivable asset turnover of fauji fertilizer 19 is better than

TURNOVER RATIO 22.8 19
22.8

Average Collection Ok Average collection period of fauji fertilizer 19 and engro is 16

Period 16 18.95

Gross Profit Poor Gross margin of fauji fertilizer is high 35% as compare to engr
Margin (%) 21.22 35.6

Operating Profit Poor Operating profit margin of fauji fertilizer is high 29.93 as comp
MARGIN (%) 20.58 29.93

Net Profit Margin Poor

(%) 13.61 18.86
Net profit also high of fauji fertilizer

Earnings per share Good EPS is engro fertilizer is high 17.17 as compare to Good
(Rs./Share) 17.17 10.86
fauji 10.86

Liquidity Ratios:
Current Ratio:

Current Ratio is equal to current assets divided by current liabilities

Current Ratio = Current Assets

Name: Talha
Id: 0120
Date 19-05-2017
Assignment No .02 And 03
Current Liabilities

2007: Current Ratio = 16397198000 = 3.11

5264674000

2006: Current Ratio = 5684446000 = 1.56

3642415000

2005: Current Ratio = 5011555000 = 1.79

2800094000

Leverage ratios:
Debt Ratio:

Debt ratio is equal to total liabilities divided by total assets.

Debt Ratio = Total Liabilities

Total Assets

2007: Debt Ratio = 7005734000= 0.18

38156651000

2006 : Debt Ratio = 3939349000= 0.25

15980816000

2005 :Debt Ratio = 6736064000= 0.48

14111630000

Times Interest Earned = Profit before Interest and Taxes

Interest Expense

2007: Interest coverage Ratio = 4770535000= 8.92 times

Name: Talha
Id: 0120
Date 19-05-2017
Assignment No .02 And 03
535023000

2006: Interest coverage Ratio = 2602207000= 7.18 times

362551000

2005: Interest coverage Ratio = 34996421000 = 12.5 times

280070000

Activity Ratios
Inventory Turnover Ratio:

Inventory Turnover Ratio is equal to Cost of Goods Sold divided by Average Inventory.

Inventory Turnover ratio = Cost of Goods Sold

Avg. Inventory

2007 Inventory Turnover Ratio = 18262793000 = 10.1 times

1808192327

2006 Inventory Turnover Ratio = 13364524000 = 9.4 times

1421757872

2005: Inventory Turnover Ratio = 14332824000 = 11.1 times

1291245405

Total asset turnover ratio measures that how much sales are generated through the
total assets of the organization.

Total Asset Turnover Ratio = Sales

Name: Talha
Id: 0120
Date 19-05-2017
Assignment No .02 And 03
Total assets

2007: Total asset turnover ratio= 23183222000 = 1.45 times

15980816000

2006: Total asset turnover ratio = 17601783000 == 1.1 times

15980816000

2005:Total asset turnover ratio = 18276277000 = 1.30 times

14111630000

Receivables turnover ratio

2007: Receivables turnover ratio = 360 = 16 days

22.8

2006: Receivables turnover ratio = 360 = 12 days

30.2

2005: Receivables turnover ratio = 360 = 11 days

34.3

Profitability Ratios:

Gross Profit Margin:

Gross profit margin is equal to the ratio of gross profit to sales.

Gross Profit Margin = Gross Profit

Sales

2007: Gross profit margin = 4920429000 X 100 = 21.22 %

23183222000
Name: Talha
Id: 0120
Date 19-05-2017
Assignment No .02 And 03
2006: Gross profit margin = 4237259000 X 100 = 24.07 %

17601783000

2005: Gross profit margin = 2641286000 X 100 = 14.45 %

18276277000

Operating Profit Margin:

Operating Profit Margin is equal to earning before interest and tax divided by sales.

Operating Profit Margin = EBIT/Operating Profit

Sales

2007: Operating Profit Margin = 4770535000 X 100 = 20.58 %

23183222000

2006: Operating Profit Margin = 3807207000 X 100 = 21.63 %

17601783000

2005: Operating Profit Margin = 3499621 X 100 = 19.15 %

18276277000

Net Profit Margin:

Net Profit Margin is equal to net profit divided by sales.

Net Profit Margin = Net Profit

Sales

2007: Net Profit Margin = 3154583000 X 100 = 13.61 %

23183222000

2006: Net Profit Margin = 2547326000 X 100 = 14.47 %

Name: Talha
Id: 0120
Date 19-05-2017
Assignment No .02 And 03
17601783000

2005: Net Profit Margin = 2319082000 X 100 = 12.69 %

18276277000

Earnings per share:

This ratio shows that how much amount per share does a common stock holder attains.

Earnings per share = Earnings Available for Common Stock Holders

No. Of Common Stock Shares

2007: Earnings per share = 3154583000 Rs. 17.17 / share

183737000

2006: Earnings per share = 2547326000 = Rs.15.47 /share

164650000

2005: Earning per share = 2319082000 Rs. 14.37 /share

1161350000