International Finance Assignment 1 Nine Dragon Paper NDP case study

By: Ehab M. Helmy Marina Emad

Supervised By: Dr. Abir Zein

How Mrs. Cheung does think? What does she believes in when it comes to building her business? She always thinks ahead and has a strong long-term vision of where her company should be. She has strong industry knowledge and so much enthusiasm for her work. This is the quality that good management must have. She wants to make NDP a 100 years old business, not only a lifelong career for her but a business lasts for generations. (The answer was taken from a research on Mrs. Cheung business history) How would you summarize the companys financial status? How does it reflect the business development goals and strategies employed by Mrs. Cheung? While trying to analyze a companys financial status, we have to take a look on three main statements:
Balance sheet statement Cash flow statement Income statement

Liquidity Ratio

Current Ratio Quick Ratio Returns

Rate of 2011 2012 2013 Change 1.312961 1.014966 1.277426 -3% 0.993251 0.71159 1.0084 2% -0.22696 0.258589 9.53362 6.475214 7.604922 -20%

Ability of the firm to pay its short term obligations

Inv. Turn Over Days of sales Assets outstanding Management DSO Ratios Fixed Assets TO Tot. Assets TO Debt Ratio Debt Management Times Interest Earrns TIE Ratio

75.68459 68.40927 94.96364 0.603698 0.615068 0.618176 0.479107 0.466742 0.446022 0.595293 0.629784 0.646398 5.837338 2.738626 2.719284

25% 2% -7% 9%

Utilization of the firm's Assets

Ability to pay Debt servicing -53%

Is NDP in troubles? How would your answer differ if you were an existing shareholder, a potential investor or an analyst? From my point of view and after reviewing the numbers, I can tell that NDP generally is not in troubles as all its future expectations have a growth rate. As for a shareholder, the Dividends are expecting a growth of almost 43%, its expected for the Share price to increase by 16% As for a Potential Investor, The Revenue is expecting a growth of 22% As for an Analyst, he shall show some concerns about the financial history for the past 3 years (as per the ratios above).

Source: Financial Times (http://markets.ft.com/research/Markets/Tearsheets/Financials?s=2689:HKG)