ASHISH KUMAR

DISHA MEHTA
KHUSHBOO SULTAN
ADVANCED FINANCIAL PRANJAL MALIK
SAJAL KUMAR
STATEMENT ANALYSIS PROJECT
Submitted by – Group 12
Table of Contents
Name of the company: Ashok Leyland (“Aapki Jeet, Humari Jeet”) ..................................................... 3
Key Information in snapshot: .............................................................................................................. 3
Introduction: ........................................................................................................................................... 3
Industry: Automotive (Commercial) ...................................................................................................... 4
Introduction to Industry:..................................................................................................................... 4
Major Business Segments ....................................................................................................................... 6
Major Competitors:................................................................................................................................. 6
Key Executives Information: ................................................................................................................... 6
Common Size Balance Sheet ................................................................................................................. 12
Comments/Analysis – ....................................................................................................................... 13
Common Size Profit & Loss ................................................................................................................... 13
Comments-........................................................................................................................................ 14
Comparison with Peers ......................................................................................................................... 15
Balance Sheet Comparison ............................................................................................................... 15
Profit & Loss Account Comparison ................................................................................................... 16
Trend Analysis of 5 years ...................................................................................................................... 17
Profit & Loss ...................................................................................................................................... 17
Comments/Analysis- ..................................................................................................................... 18
Balance Sheet.................................................................................................................................... 18
Comments/Analysis- ..................................................................................................................... 18
Key Performance Indicators .................................................................................................................. 19
Key products/services ....................................................................................................................... 19
Credit rating ...................................................................................................................................... 20
Shareholding Pattern ............................................................................................................................ 21
As of March 31, 2016 ........................................................................................................................ 21
As of March 31, 2017 ....................................................................................................................... 21
As of March 31, 2018 ........................................................................................................................ 22
Major changes in the shareholding pattern ................................................................................. 22
Auditors................................................................................................................................................. 23
Statutory auditors ............................................................................................................................. 23
Cost auditors ..................................................................................................................................... 23
Details of Debt Structure & Security ..................................................................................................... 23
Limitations and assumptions for Future Profitability, Liquidity & Efficiency ....................................... 24
The Year ahead ................................................................................................................................. 24
Profitability........................................................................................................................................ 25
 Liquidity............................................................................................................................................. 25
SWOT Analysis....................................................................................................................................... 25
Strengths ........................................................................................................................................... 25
Weaknesses ...................................................................................................................................... 26
Opportunities .................................................................................................................................... 26
Threats .............................................................................................................................................. 26
Solvency Ratios ..................................................................................................................................... 28
Debt to Equity Ratio .......................................................................................................................... 28
Total Debt to Total Asset Ratio ......................................................................................................... 28
Interest Coverage Ratio .................................................................................................................... 28
Liquidity Ratios ...................................................................................................................................... 29
Quick Ratio ........................................................................................................................................ 29
Current Ratio ..................................................................................................................................... 29
Dividend Pay-out Ratio ..................................................................................................................... 29
Activity Ratios ....................................................................................................................................... 30
Total Assets Turnover Ratio .............................................................................................................. 30
Fixed Assets Turnover Ratio .............................................................................................................. 30
Current Assets Turnover Ratio .......................................................................................................... 30
Inventory Turnover Ratio .................................................................................................................. 31
Name of the company: Ashok Leyland (“Aapki Jeet, Humari Jeet”)

Key Information in snapshot:

Type Public
Traded on BSE, NSE
Industry Automotive(Commercial)
Founded 7 September 1948
Headquarters Chennai, Tamil Nadu, India
Current Price Rs. 110
Revenue Rs. 213.3 Billion
Net Income Rs. 12.23 Billion
Parent Hinduja Group

Introduction:
Ashok Leyland is the second largest commercial vehicle manufacturer in India, fourth largest
manufacturer of buses in the world and 12th largest manufacturer of trucks globally. It also makes
spare parts and engines for industrial and marine applications.
Currently, it deals in Buses, trucks and light vehicles. The company has maintained its profitable
record of accomplishment for 60 years. It is also one of the largest private sector employers in India,
with about 12,000 employees working in nine factories and offices spread across the globe.
In 2013-14, the company posted a very modest profit after tax of Rs. 290 million that was made
possible after the selling of real estate and other surplus land and related assets. The company did
not declare any dividends for the financial year 2013-14, which is also a first in its 60-year history.

The company has increased its rated capacity to 105,000 vehicles per annum. Further investment
plans include putting up two new plants - one in Uttarakhand in North India and a bus bodybuilding
unit in Middle East Asia are fast afoot. It already has a sizeable presence in African countries like
Nigeria, Ghana, Egypt and South Africa.

Key market presence:

The Company has a strong market presence in SAARC countries like Bangladesh, Sri Lanka and Nepal,
and in the Middle East countries where it exports 3600-4000 units a year. The company has an
assembly unit, mainly for buses, in UAE to cater to the Gulf Cooperation Council (GCC) member
states. This unit currently assembles 4000 units, which the company plans to increase to 6000 units.

Technology:
Ashok Leyland has always used the latest technology to its best and made the best products in its
industry. It was the first in India to introduce multi-axled trucks, full air brakes and innovations like
the rear engine and articulated buses.
In 1980s and 1990s, it with various Tamil Nadu Transport Corporation, notably Cholan Roadways
Corporation based in Trichripally, experimented with low pollutant emission based on the CNG
technology. In 2002, it developed the first hybrid electric vehicle. Ashok Leyland has also launched a
mobile emission clinic that operates on highways and at entry points to New Delhi. The clinic checks
vehicles for emission levels, recommends remedies and offers tips on maintenance and care. This
work will help generate valuable data and garner insight that will guide further development.
Hythane engines:
Ashok Leyland has also developed hythane engines in association with the Australian company Eden
Energy. Ashok Leyland successfully developed a 6-cylinder, 6-litre (370 cu in) 92 kW (123 hp) BS-4
engine which uses hythane (H-CNG,) which is a blend of natural gas and around 20% of hydrogen.
Hydrogen helps improve the efficiency of the engine but the CNG aspect makes sure that emissions
are at a controlled level. A 4-cylinder 4-litre (240 cu in) 63 kW (84 hp) engine is also being developed
for H-CNG blend in a joint R&D program with MNRE (Ministry of New and Renewable Energy) and
Indian Oil Corporation.

CNG engines:
The CNG concept is now in full swing, with more than 5,500 of the technology's vehicles running
around Delhi. The company is also already discussing the wide-scale use of hythane.

Electric Technology:
In 2016, the company launched the country’s first indigenously produced fully electric bus, called
Circuit. The bus is a zero-emission vehicle that can run 120 km on a single charge, and has an alert
system that can signal if the bus is low on power. [35] The bus will be introduced under the National
Electric Mobility Plan with an aim of 20% penetration of electric or hybrid vehicles by 2020.engines
with the Indian government. Hythane engines may be expected in the near future.

Industry:
Automotive (Commercial)

Introduction to Industry:
The Indian auto industry became the fourth largest in the world with sales increasing 9.5 per cent
year-on-year to 4.02 million units (excluding two wheelers) in 2017. It was the seventh largest
manufacturer of commercial vehicles in 2017.

The Indian Commercial Vehicle Industry has shown a de-growth of 10 percent in export for the year
2018 compared to the previous year 2017. The current market size of the Indian CV is
approximately 8.7 lakhs units for the year 2018 included MAN, DICV, and Scania. The Industry has
anticipated a double-digit growth for the year 2019 for SCV and HCV segments.

The government has recently initiated five major steps in N and M category vehicles for safety
standards. The development of infrastructure, growth of economy, replacement cycles, the new and
upcoming rules and regulation, transportation of heavy goods and machinery, growth in the
construction and mining segment, advancement in technology, E waybill systems, new safety norms,
telematics, high demands are expected in the rural economy due to normal monsoon, overloading
ban, hub and spoke model started to work on the ground are the major initiative and the key drivers
for development and growth of industry. The Ministry of road transport was successful in building
9829 kilometres of National Highways during the year 2018, which is approximately twenty percent
of growth compared to the previous financial year.

New systems like the emergency button and GPS tracking devices will be made mandatory
accessories for selected vehicles. The OEMs will have to pass the changes to initiate the technical
changes, which will cost a good amount. The year 2018 registered a huge growth for the tractor-
trailer, Tipper, and 31T plus rigid haulage. ACG expected that value proposition solution and
utilization of vehicle could be considered as the next game changer for the industry. The report
included Product/ Make presence in every segment, its position, Specs, Features, Application, and
other key information.

Recently ROI is also changed of Premium Truck and Bus product and fleet owner expected to reduce
ROI cycle at least by one year.

Ashok Leyland has been successful in narrowing the gap against its competitors and improve their
market share in all major segments. Tata Motors has lost a valuable 12.5 percentage of market
share in CV segment. Ashok Leyland, Mahindra, and Eicher have increased their market share
compared to their competitors.
Major Business Segments
1. Trucks: Mining and Construction, Distribution, Haulage, Tractors
2. Buses: School and College, Staff, Stage Carrier, Intercity, Tourist, City, Airport
3. Light Vehicles: Light Commercial Vehicles, Small Commercial Vehicles, Goods Carrier,
Passenger
4. Power Solutions: Diesel Generators, Agricultural Engines, Industrial Engines, Marine Engines
5. Defence Vehicles
6. Spare Parts
7. Services

Major Competitors:

Company Name Current Price EPS PE Ratio

Ashok Leyland 110.30 20.72 5.32
Tata Motors 184.15 -51.38 -3.58
SML Isuzu 720 122.63 5.87

Key Executives Information:

 Board of Directors:
Mr. Dheeraj G. Hinduja: Chairman
Dr. Andrew C Palmer
Dr. Andreas H Biagosch
Mr. D.J. Balaji Rao
Mr. Jean Brunol
Mr. Jose Maria Alapont
Mrs. Manisha Girotra
Mr. Sanjay K. Asher
Mr. Sudhindar K. Khanna
Mr. Vinod K. Dasari: Chief Executive Officer and Managing Director
 Board Committee Members:
Audit Committee
Mr. Sanjay K. Asher (Chairman)
Mr. D.J. Balaji Rao
Mr. Jean Brunol
Mr. Sudhindar K. Khanna
Stakeholders relationship Committee
Mr. Sanjay K. Asher (Chairman)
Mr. D. J. Balaji Rao
Ms. Manisha Girotra
Nomination and Renumeration Committee
Mr. D. J. Balaji Rao (Chairman)
 Mr. Dheeraj G. Hinduja
Mr. Jose Maria Alapont
Ms. Manisha Girotra
Corporate Social Responsibility Committee
Mr. Dheeraj G. Hinduja (Chairman)
Ms. Manisha Girotra
Mr. Vinod K. Dasari
Technology Committee
Dr. Andrew C Palmer (Chairman)
Dr. Andreas H Biagosch
Mr. Jean Brunol
Investment Committee
Mr. Dheeraj G Hinduja (Chairman)
Mr. D. J. Balaji Rao
Ms. Manisha Girotra
Risk Management Committee
Dr. Andreas H. Biagosch (Chairman)
Mr. D J Balaji Rao
Mr. Sanjay K Asher
Mr. Gopal Mahadevan
Secretary for all the Committees.
Mr. N Ramanathan
MANAGEMENT DISCUSSION AND ANALYSIS

ECONOMY
The International Monetary Fund (IMF) is projecting an acceleration for the Indian economy, with
the GDP growth of 6 .7% in 2016 -17 s calling up to 7.4 % in 2017-18 and projected to reach 7.8% for
2018-19, potentially making India the world ’s fastest growing largest economy

COMMERCIAL VEHICLE INDUSTRY

The commercial vehicle industry in India grew by 23 % during 2017-18. This grow th has come on the
back of government’s pus h towards infrastructure development, road construction, mining activities
along with increased demand from e-commerce and FMCG applications. In addition there was strict
enforcement on vehicle overloading which drove commercial vehicle demand .

The implementation of GST and restriction of overloading resulted in a shift towards higher tonnage
and high powered products

The M&HCV bus segment declined sharply during the year. This was on account of sluggish demand
for large buses and a deferment of purchases by the State Transport Undertakings (STU’s) owing to
lower budgetary allocations for fleet modernisation

T h e Light Commercial Vehicle ( LCV ) segment showed a healthy growth of 25 % over last year. This
was driven by easier access to finance and lower interest rates for first time buyers, small fleet
operators
ASHOK LEYLAND – THE YEAR (2017-18)
Company continued to steadily grow sales and revenues across all its business divisions. M&HCV
vehicle sales grew 15.8% to 131,432 units (116,534 in domestic and 14,898 in export markets). LCV
achieved record sales of 43,441 vehicles, with a growth of 3 7% over the previous year

M&HCV Truck Segment

Company crossed 100 thousand mark in domestic M&HCV truck sales in the current financial year
for the first time in its 70 year history. Sales grew 21.5% to 102,826 for M&HCV trucks.

This year the impetus was also on expanding our digital footprint, and Company enhanced its “i-
Alert” digital interface to assist customers towards effective, real-time fleet management. More
than 15,000 trucks pre-fitted with i-Alert technology were sold during the year. Consequent of these,
Company once again saw a market share growth in almost all segments and regions of the Country ,
leading to a record full year sales of 102,826 M&HCV trucks. In addition, Company exported 8,000
vehicles, mainly to South Asian and African markets

M&HCV Bus segment

Your Company maintained its Global 4th position in volume sales . In the M&HCV Bus segment, your
Company has overall leadership in the Indian Bus market, with a gain of 5.5 % & 5.3 % market share
in ICV -Private & MDV -Private segments respectively. Export volumes grew by 33% in the year
ended 2017-18 and one out of every three buses sold were in export markets

OPPORTUNITIES AND THREATS

With the transition to Bharat Stage IV (BS-IV) emission norms completed and GST related
regulations implemented, the commercial vehicle industry has seen a steady growth in demand.
Vehicle utilisation is on the rise and turnaround time has reduced with the removal of state border
check posts . This has facilitated the establishment of a hub -and spoke logistics model for
distribution. As a result, the multiaxle vehicle segment is witnessing a huge growth in demand ,
together with the Light and Intermediate Commercial Vehicles ( LCV s ad ICV s ) .

The Union Budget for 2018-19 is overall positive for the automotive industry with its focus on
infrastructure. The Government’s push toward s infrastructure development, restrictions on
overloading, road construction and mining activities, along with increasing demand from e-
commerce and FMCG applications is expected to boost freight demand.

With the introduction of safety regulations in the cabin, fully built trucks and buses are likely to see
an upshift. There are series of policy interventions proposed by the government ( e.g . bus -body
code, truck code) . These policies offer opportunities for the CV industry to enhance product
offerings aimed to improve road-safety, driver comfort, and fuel efficiency.

The Voluntary Vehicle fleet Modernisation Programme (V-VMP) policy, which aims to incentivise
replacement of old commercial vehicles , has received a nod from the Finance Ministry. It has now
been sent to the GST Council, which will decide the amount of concession that Central and State
Governments will offer for vehicle replacement.

Crude oil prices have been steadily rising , and with daily revision in prices, these are reflecting in the
high domestic retail price for Petrol and Diesel. This is a critical factor in the TCO (total cost of
operation) for a commercial vehicle operator. Sharp increase in the price of diesel, could be a threat
to the growth in the overall logistics industry

COMPANY PERFORMANCE
Revenues:

Company ’s revenues improved by 24 % aid ed b y th e price increase consequent to upgradation of

emission norms in India (to BS IV effective April 1, 2017), shift in the sales from haulage ( 16 tonne or
less ) to higher tonnage vehicles viz., Tractor trailers, Multi Axled vehicles and tippers as well as
upward revision in prices to partially mitigate commodity price increases during the year

Costs:

 Material Cost: Through various internal initiatives, your Company could manage to contain
material cost increase by ab out 1.1% during the year.

 Staff Costs: Employee expenses are up by 22% reflecting the impact of stock options, full
year impact of staff cost of Foundries Division in FY 2018 (` 57 Crores incremental in current
year) , full year impact of increments and performance pay , salary revision for executives as
well as bonus provisioning for associates at all manufacturing units during the year

 Finance Cost - Decreased to ` 13 1 Crores during the year.

 Depreciation – Depreciation for the year is at ` 555 Crores which is higher than last year
amount of ` 518 Crores .

 Other expenses in term s of percentage of revenue is same as last year. For AL, other
expenses have increased by 20% f rom ` 2,384 Crores in FY ’17 to ` 2,863 Crores in FY ’18
reflecting the increase in volume.

 Capital Employed - Total capital employed by your Company increased by 18% from `14,040
Crores to `16,586 Crores reflecting the increase in activity levels
Common Size Balance Sheet
% of Total of % of Total
Mar-18 Balance Mar-17 of Balance
Sheet Sheet
EQUITIES AND LIABILITIES
SHAREHOLDER'S FUNDS
Equity Share Capital 292.71 0.9% 284.59 1.1%
Total Share Capital 292.71 0.9% 284.59 1.1%
Revaluation Reserves 0 0.0% 0 0.0%
Reserves and Surplus 7,127.88 21.3% 6,108.36 22.9%
Total Reserves and Surplus 7127.88 21.3% 6108.36 22.9%
Total Shareholders’ Funds 7420.59 22.1% 6392.94 24.0%
Minority Interest 825.33 2.5% 588.99 2.2%
NON-CURRENT LIABILITIES 0.0% 0.0%
Long Term Borrowings 10,228.09 30.5% 8,876.42 33.3%
Deferred Tax Liabilities [Net] 298.51 0.9% 126.93 0.5%
Other Long Term Liabilities 240.67 0.7% 94.56 0.4%
Long Term Provisions 313.32 0.9% 189.16 0.7%
Total Non-Current Liabilities 11080.59 33.1% 9287.07 34.8%
CURRENT LIABILITIES 0.0% 0.0%
Short Term Borrowings 1,919.20 5.7% 1,034.71 3.9%
Trade Payables 5,074.65 15.1% 3,450.15 12.9%
Other Current Liabilities 6,584.75 19.6% 5,565.11 20.9%
Short Term Provisions 612.89 1.8% 349.35 1.3%
Total Current Liabilities 14191.48 42.3% 10399.32 39.0%
Total Capital And Liabilities 33517.99 100.0% 26668.32 100.0%
ASSETS 0.0% 0.0%
NON-CURRENT ASSETS 0.0% 0.0%
Tangible Assets 5,069.47 15.1% 5,072.23 19.0%
Intangible Assets 418.93 1.2% 410.82 1.5%
Capital Work-In-Progress 251.11 0.7% 195.92 0.7%
Intangible Assets Under Development 188.31 0.6% 48.27 0.2%
Fixed Assets 5927.83 17.7% 5727.23 21.5%
Non-Current Investments 966.84 2.9% 845.21 3.2%
Deferred Tax Assets [Net] 141.78 0.4% 113.48 0.4%
Long Term Loans And Advances 9,935.69 29.6% 6,701.86 25.1%
Other Non-Current Assets 1,016.56 3.0% 1,009.82 3.8%
Total Non-Current Assets 19096.43 57.0% 15505.35 58.1%
CURRENT ASSETS 0.0% 0.0%
Current Investments 3,415.74 10.2% 1,088.11 4.1%
Inventories 2,207.69 6.6% 2,901.03 10.9%
Trade Receivables 1,175.50 3.5% 1,238.40 4.6%
Cash And Cash Equivalents 1,230.51 3.7% 1,063.61 4.0%
Short Term Loans And Advances 5,117.99 15.3% 4,132.99 15.5%
Other Current Assets 1,274.13 3.8% 738.84 2.8%
Total Current Assets 14421.56 43.0% 11162.98 41.9%
Total Assets 33517.99 100.0% 26668.32 100.0%
Comments/Analysis –
1. The amount of shareholders’ funds has increased from the last year but the share as a % of
total capital and liabilities has decreased marginally from 24% to 22%.
2. Long term borrowings have increased from the last year but the % share has declined from
35% to 33%. Long-term debt stood at Rs 10,228 crores as compared to Rs 8,876 crores
during FY17, a growth of 15.2%.
3. The % share of current liabilities have increased from 39% to 43%.
4. This shows that the company is focusing more on short term commitments instead of long
term. To be particular, short term borrowings have been almost doubled from the last year.
5. In assets, the share of current investments has seen a huge increase from 4% to 10% which
directly shows that the company is focusing on short term requirements.
6. The blockage of funds in inventories has also come down from 11% to only 6%. The
company’s focus is on releasing money from inventories and invest in current investments.

Common Size Profit & Loss

% of % of
Total of Total of
Mar-18 Balance Mar-17 Balance
Sheet Sheet
INCOME
Revenue From Operations [Gross] 29336.74 98.4% 23813.55 103.5%
Less: Excise/Service Tax/Other Levies 281.52 0.9% 1,318.86 5.7%
Revenue From Operations [Net] 29055.22 97.4% 22494.7 97.8%
Other Operating Revenues 564.35 1.9% 376.27 1.6%
Total Operating Revenues 29,619.57 99.3% 22,870.97 99.4%
Other Income 199.88 0.7% 130.69 0.6%
Total Revenue 29819.45 100.0% 23001.66 100.0%
EXPENSES 0.0% 0.0%
Cost Of Materials Consumed 17,317.71 58.1% 14,069.56 61.2%
Purchase Of Stock-In Trade 750.5 2.5% 1,403.62 6.1%
Operating And Direct Expenses 0 0.0% 0 0.0%
Changes In Inventories Of FG,WIP And Stock-In Trade 1,149.86 3.9% -739.47 -3.2%
Employee Benefit Expenses 2,257.48 7.6% 1,850.00 8.0%
Finance Costs 1,231.72 4.1% 1,048.80 4.6%
Depreciation And Amortisation Expenses 645.89 2.2% 572.79 2.5%
Other Expenses 3,895.59 13.1% 2,993.32 13.0%
Total Expenses 27248.75 91.4% 21198.62 92.2%
Profit/Loss Before Exceptional, Extraordinary Items And
2,570.71 8.6% 1,803.04
Tax 7.8%
Exceptional Items 0.39 0.0% 40.09 0.2%
Profit/Loss Before Tax 2571.1 8.6% 1843.13 8.0%
Tax Expenses-Continued Operations 0.0% 0.0%
Current Tax 789.28 2.6% 440.03 1.9%
Deferred Tax -38.17 -0.1% -243.91 -1.1%
Total Tax Expenses 751.12 2.5% 196.12 0.9%
Profit/Loss After Tax And Before Extraordinary Items 1,819.98 6.1% 1,647.01 7.2%
Profit/Loss From Continuing Operations 1,819.98 6.1% 1,647.01 7.2%
Profit Loss From Discontinuing Operations -12.73 0.0% -4.23 0.0%
Net Profit Loss From Discontinuing Operations -12.73 0.0% -4.23 0.0%
Profit/Loss For The Period 1807.25 6.1% 1642.78 7.1%

Comments-
1. Operating income during the year rose 29.5% on a year-on-year (YoY) basis but the % share
as a total of revenue has declined.
2. The company's operating profit increased by 29.0% YoY during the fiscal. Operating profit
margins witnessed a fall and stood at 14.3% in FY18 as against 14.4% in FY17.
3. Depreciation charges and finance costs increased by 12.8% YoY and 17.4% YoY, respectively.
Also, the share in the total of revenue remains the same.
4. Other income grew by 52.9% YoY. Though, the share in total of revenue has marginally
increased from 0.6% to 0.7%.
5. Net profit for the year grew by 11.6% YoY. The share in total of revenue has declined from
7% to 6%.
6. The % share of net profit margin to total revenue is low as compared to other competitor
firms.
Comparison with Peers

A Snapshot
Name Last Price Market Cap. Sales Net Profit Total Assets
(Rs. cr.) Turnover

Eicher Motors 23,945.35 65,295.62 8,957.51 1,712.91 5,458.21

Tata Motors 180.2 52,030.02 58,831.41 -1,034.85 36,426.76
Ashok Leyland 106.1 31,145.94 26,247.91 1,562.59 7,680.48
SML Isuzu 682.95 988.34 1,135.05 8.5 586.54

Balance Sheet Comparison

Eicher Tata Force
Ashok Leyland
Motors Motors Motors
Mar '18 Mar '18 Mar '18 Mar '18
Sources Of Funds
Total Share Capital 292.71 27.26 679.22 13.18
Equity Share Capital 292.71 27.26 679.22 13.18
Share Application Money 0 0 0 0
Preference Share Capital 0 0 0 0
Reserves 6,872.09 5,344.97 19,491.76 1,785.61
Revaluation Reserves 0 0 0 0
Net worth 7,164.80 5,372.23 20,170.98 1,798.79
Secured Loans 100 0 2,444.36 0
Unsecured Loans 415.69 85.98 13,811.42 0
Total Debt 515.69 85.98 16,255.78 0
Total Liabilities 7,680.49 5,458.21 36,426.76 1,798.79
Application Of Funds
Gross Block 6,102.56 2,084.74 39,141.05 2,106.89
Less: Accum. Depreciation 1,128.34 591.32 17,537.30 1,164.46
Net Block 4,974.22 1,493.42 21,603.75 942.43
Capital Work in Progress 401.24 337.07 5,196.60 375.2
Investments 5,802.63 3,865.99 16,081.66 10.6
Inventories 1,709.88 379.23 6,352.04 477.1
Sundry Debtors 980.48 78.02 3,479.81 241.91
Cash and Bank Balance 1,004.40 1,208.82 795.42 40.93
Total Current Assets 3,694.76 1,666.07 10,627.27 759.94
Loans and Advances 1,713.23 432.12 5,703.02 430.86
Total CA, Loans &
5,407.99 2,098.19 16,330.29 1,190.80
Advances
Current Liabilities 8,034.32 2,260.13 20,913.14 668.5
Provisions 871.28 76.33 1,872.40 51.74
Total CL & Provisions 8,905.60 2,336.46 22,785.54 720.24
Net Current Assets -3,497.61 -238.27 -6,455.25 470.56
Miscellaneous Expenses 0 0 0 0
Total Assets 7,680.48 5,458.21 36,426.76 1,798.79
Profit & Loss Account Comparison
Eicher Tata Force
Ashok Leyland
Motors Motors Motors
Mar '18 Mar '18 Mar '18 Mar '18
Income
Sales Turnover 26,524.51 9,211.81 59,624.69 3,531.01
Excise Duty 276.6 254.3 793.28 100.82
Net Sales 26,247.91 8,957.51 58,831.41 3,430.19
Other Income 155.06 19.31 602.91 62.5
Stock Adjustments -1,278.52 31.47 -842.05 51.32
Total Income 25,124.45 9,008.29 58,592.27 3,544.01
Expenditure
Raw Materials 17,451.05 4,820.27 42,482.21 2,685.59
Power & Fuel Cost 228.74 52.37 545.12 48.23
Employee Cost 1,811.92 547.86 3,966.73 386.55
Other Manufacturing Expenses 0 0 474.98 0
Selling and Admin Expenses 0 11.84 720.18 18.97
Miscellaneous Expenses 2,738.70 703.44 6,491.68 67.14
Preoperative Exp Capitalised 0 0 0 0
Total Expenses 22,230.41 6,135.78 54,680.90 3,206.48
Operating Profit 2,738.98 2,853.20 3,308.46 275.03
PBDIT 2,894.04 2,872.51 3,911.37 337.53
Interest 131.25 3.04 1,744.43 6.67
PBDT 2,762.79 2,869.47 2,166.94 330.86
Depreciation 554.61 222.34 3,101.89 129.26
Other Written Off 0 0 0 0
Profit Before Tax 2,208.18 2,647.13 -934.95 201.6
Extra-ordinary items 0 0 0 0
PBT (Post Extra-ord Items) 2,208.18 2,647.13 -934.95 201.6
Tax 668.13 935.36 87.93 53.28
Reported Net Profit 1,562.59 1,712.91 -1,034.85 146.95
Total Value Addition 4,779.36 1,315.51 12,198.69 520.89
Preference Dividend 0 0 0 0
Equity Dividend 549.48 272.22 0 13.18
Corporate Dividend Tax 0 44.9 0 2.68
Per share data (annualised)
Shares in issue (lakhs) 29,271.04 272.56 33,958.51 131.76
Earnings Per Share (Rs) 5.34 628.46 -3.05 111.53
Equity Dividend (%) 243 1,100.00 0 100
Book Value (Rs) 24.48 1,971.06 59.4 1,365.17
Trend Analysis of 5 years

Profit & Loss

Mar Mar- Mar- Mar- Mar-
18 17 16 15 14
(Base
INCOME
Year)
Total
29,619.5 22,870.9 199 21,259.9 185 15,340.8 134 11,486.7 100
Operating 258%
7 7 % 0 % 9 % 2 %
Revenues
Other 141 177 204 100
199.88 216% 130.69 163.62 188.83 92.45
Income % % % %
Total 29,819.4 23,001.6 199 21,423.5 185 15,529.7 134 11,579.1 100
258%
Revenue 5 6 % 2 % 1 % 7 %
EXPENSES
Cost Of
17,317.7 14,069.5 200 12,821.9 182 140 100
Materials 246% 9,824.58 7,030.12
1 6 % 4 % % %
Consumed
Purchase Of
192 221 100
Stock-In 750.5 102% 1,403.62 1,616.03 645.51 88% 732.5
% % %
Trade
Changes In
Inventories - -
- 100
Of FG,WIP 1,149.86 317% -739.47 204 -464.18 128 -41.46 363.06
11% %
And Stock- % %
In Trade
Employee
137 127 114 100
Benefit 2,257.48 168% 1,850.00 1,710.67 1,536.11 1,345.58
% % % %
Expenses
Finance 130 115 108 100
1,231.72 153% 1,048.80 925.05 872.29 805.49
Costs % % % %
Depreciation
And 108 109 100
645.89 122% 572.79 523.94 99% 579.91 529.97
Amortisation % % %
Expenses
Other 189 164 117 100
3,895.59 246% 2,993.32 2,596.51 1,845.03 1,580.64
Expenses % % % %
Total 27,248.7 21,198.6 171 19,729.9 159 15,275.9 123 12,400.1 100
220%
Expenses 5 2 % 6 % 6 % 5 %
Profit/Loss
Before
Exceptional - -
- - 100
, 2,570.71 1,803.04 220 1,693.56 206 253.76 -820.98
313% 31% %
Extraordina % %
ry Items
And Tax
Exceptional - - 100
0.39 0% 40.09 8% -406.33 -295.32 520.77
Items 78% 57% %
- -
Profit/Loss - 100
2,571.10 1,843.13 614 1,287.24 429 -41.56 14% -300.21
Before Tax 856% %
% %
Tax
Expenses-
Continued
Operations
- - - -
Total Tax 100
751.12 1097 196.12 286 496.57 725 172.42 252 -68.5
Expenses %
% % % %
Profit/Loss - -
- 100
For The 1,807.25 1,642.78 709 790.66 341 -213.97 92% -231.71
780% %
Period % %
Comments/Analysis-
1. The total revenue has almost increased by 2.5 times and the profit after tax has increased
almost 8 times which clearly indicates that total expenses has increased less than
proportionately.
2. There is not much increase in employee cost as other costs which shows that the company
has cut down costs in this segment while still increasing the revenue.
3. The company incurred losses in the year 2014 and 2015. After 2015, the company’s profit
after taxes has increased almost 2.5 times from 2016 to 2018.

Balance Sheet
Mar Mar- Mar- Mar- Mar-
18 17 16 15 14
EQUITIES AND (Base
LIABILITIES Year)
SHAREHOLDE
R'S FUNDS
Total
7,420.5 186 6,392.9 160 5,263.7 132 4,511.3 113 3,989.2 100
Shareholders’
9 % 4 % 0 % 1 % 3 %
Funds
NON-
CURRENT
LIABILITIES
Total Non-
11,080. 183 9,287.0 154 8,275.9 137 6,877.4 114 6,038.9 100
Current
59 % 7 % 1 % 7 % 5 %
Liabilities
CURRENT
LIABILITIES
Total Current 14,191. 207 10,399. 152 8,241.8 120 7,872.7 115 6,854.0 100
Liabilities 48 % 32 % 1 % 0 % 2 %
Total Capital 33,517. 191 26,668. 152 22,198. 127 19,524. 111 17,534. 100
And Liabilities 99 % 32 % 71 % 62 % 31 %
ASSETS
NON-
CURRENT
ASSETS
5,927.8 5,727.2 5,223.2 6,059.5 7,087.4 100
Fixed Assets 84% 81% 74% 85%
3 3 4 2 7 %
Total Non- 19,096. 170 15,505. 138 13,329. 119 11,956. 107 11,216. 100
Current Assets 43 % 35 % 80 % 91 % 38 %
CURRENT
ASSETS
Total Current 14,421. 228 11,162. 177 8,868.9 140 7,567.7 120 6,317.9 100
Assets 56 % 98 % 0 % 1 % 3 %
33,517. 191 26,668. 152 22,198. 127 19,524. 111 17,534. 100
Total Assets
99 % 32 % 71 % 62 % 31 %

Comments/Analysis-
1. The increase in shareholder’s funds and long term liabilities from 2014 to 2018 is less than
the increase in short term liabilities. This shows that the company is dependent more on
short-term liabilities than long-term commitments now.
2. Current liabilities have increased almost more than twice.
3. In assets, the main point of focus is less investment in fixed assets. The company’s
investments in fixed assets have decreased over the years i.e. from 7,000 crores in 2014 to
6,000 crores in 2018.
4. The company has invested more of its funds in its current assets like current investment,
receivables, etc. The current assets have more than doubled in the last 5 years.
Key Performance Indicators

Key products/services
Medium & Heavy
The company has been performing remarkably in Commercial Vehicles
all the three key divisions and a constant growth
could be observed in the sales of the products as Light Commercial
well. Vehicles

Power Solutions
Systems

M&HCV Domestic sales (last 3 years)

Truck segment:

Ashok Leyland sold 131,432 units M&CHV in FY18 (116,534 in domestic and 14,898 in export
markets) seeing a 15.8% growth over the previous year.
The company crossed 100
thousand sales for the first time in M&HCV Sales (last three financial years)
70 years. 140,000
3718 Plus, a new product
120,000
launched in the year 2017 was
awarded “Truck of the year”. 100,000
In the tractors-trailers segment, 80,000
the company grew faster than the
102,826
industry, registering 41% growth 60,000 79,223 84,607
over the last year. 40,000

20,000
Bus segment: 19,586 17,225 13,708
0
The company maintained its FY16 FY17 FY18
global 4th position in volume sales
M&HCV Bus M&HCV Trucks
Export volumes grew by 33%

LCV Segment
Record sales of 43,441 light commercial vehicles was recorded in FY18 with a growth of 37%
over the previous year
The company rolled out its 2,00,000th LCV vehicle on the road, highlighting the popularity and
performance of the brand
Launch of Dost+, helped the company in achieving record sales of 5,396 vehicles in March
2018
Credit rating
After 20 years the Company’s debt rating has been upgraded by CARE ratings. During March 2018, the
Company’s financial rating has been upgraded from CARE AA to CARE AA+ with stable outlook. During
March 2018, ICRA reaffirmed the credit rating at ICRA AA with outlook revised from stable to positive.
Details are as follows:

Short-term
Agency Long-term facilities/Commercial
papers
• CARE • CARE AA+; stable • CARE A1+
• ICRA outlook • ICRA A1+
• (ICRA) AA; positive
outlook
Shareholding Pattern
As of March 31, 2016

% to Capital 0.01
Promoters – Hinduja Automotive Limited
0.02 0.81

Resident Individuals
3.96
3.45
Clearing Members
6.94
Financial Institutions/Insurance Co./State Govt./ Govt. Companies/UTI

Foreign Institutional Investors

NRI/OCB/Corporate Bodies - Foreign/Bank - Foreign/Foreign 18.98

Nationals/Foreign Port Folio Investor-corporate 50.38
Corporate Bodies/Limited Liability Partnership

Mutual Funds

6
Trusts
9.26
Banks 0.19

Others - GDR A/C

Total number of shares: 2,84,58,76,634 (2.84 billion)

As of March 31, 2017

% to Capital
0.14
Promoters – Hinduja Automotive Limited
0.24 0.81
2.88
Resident Individuals 0.51
3.7
Clearing Members

Financial Institutions/Insurance Co./State Govt./ Govt. Companies/UTI

Foreign Institutional Investors 19.95

Foreign Portfolio Investors

50.38
NRI/OCB/Corporate Bodies - Foreign/Bank - Foreign Nationals

Corporate Bodies/Limited Liability Partnership 4.35

Mutual Funds 5.22

Trusts
11.41
Banks
0.41
Others - GDR A/C

Total number of shares: 2,84,58,76,634 (2.84 billion)

As of March 31, 2018

% to Capital
0.01
0.17
Promoters – Hinduja Automotive Limited
2.15 0.29 0.79
Resident Individuals
0.45 6.55
IEPF Authority / Unclaimed Securities Suspense A/c

Clearing Members

Financial Institutions/Insurance Co./State Govt./ Govt. Companies/UTI

Foreign Institutional Investors

25.15
Foreign Portfolio Investors
51.27
NRI/OCB/Corporate Bodies - Foreign/Bank - Foreign Nationals

Corporate Bodies/Limited Liability Partnership

Mutual Funds
3.64
Trusts

Banks 9.05
0.13
Alternative Investment Fund
0.23 0.12
Others - GDR A/C
Total number of shares: 2,92,71,04,101 (2.92 billion)

Major changes in the shareholding pattern

Promoters’ shareholding Shareholding of FIIs has been

remained constant in FY16 and declining each year from
FY17 but increased in FY18 to 18.98% in FY16 to 4.35% FY17
51.27% to 0.13% in FY18

Shareholding of Mutual Funds

Shareholding of FPIs has increased from 3.70% in
increased from 19.95% in FY17 FY17 to 6.55% in FY18
to 25.15% in FY18
Auditors
Statutory auditors
Price Waterhouse & Co Chartered Accountants LLP
Price Waterhouse & Co Chartered Accountants LLP (FRN 304026E/ E300009), Statutory Auditors of
the Company, hold office till the conclusion of seventy third Annual General Meeting of the
Company.

The Auditor’s report to the shareholders on the standalone and consolidated financial statement for
the year ended March 31, 2018 does not contain any qualification, observation or adverse
comment.

Cost auditors
Geeyes & Co.

Details of Debt Structure & Security

Non-Current Financial Liabilities – Borrowings As at March 31, As at March 31,

2018 2017
(in Rs. Lakhs) (in Rs. Lakhs)
A) Secured borrowings
i) Redeemable non-convertible 208,600.00 213,070.14
Debentures
ii) Term loan from Banks 655,307.95 522,441.45
iii) External commercial borrowing from 943.11 6,744.24
banks
iv) Other loans 3,118.00 3,138.76
B) Unsecured borrowings
i) Redeemable non-convertible 103,500.00 68,128.70
Debentures
ii) Term loan from Banks 9,771.28 -
iii) External commercial borrowing from 31,428.05 63,224.73
banks
iv) Interest free sales tax loans 10,140.67 10,894.04
1,022,809.06 887,642.06

Current Financial Liabilities – Borrowings As at March 31, As at March 31,

2018 2017
(in Rs. Lakhs) (in Rs. Lakhs)
A) Secured borrowings
Loans from banks 91,571.43 81,478.85
B) Unsecured borrowings
Loans from banks 26,557.55 21,992.25
Commercial papers (maximum outstanding during the 73,790.86 -
year Rs. 150,000 Lakhs (March 2017: Rs. 80,000 Lakhs))
191,919.84 103,471.10
 Non-Current Financial Liabilities – Others As at March 31, As at March 31,
2018 2017
(in Rs. Lakhs) (in Rs. Lakhs)
A) Capital creditors 29.16 -
Derivatives not designated in hedging relationships - 4,721.68
B) Others 2,967.46 143.48
2,996.62 4,865.16

Current Financial Liabilities – Others As at March 31, As at March 31,

2018 2017
(in Rs. Lakhs) (in Rs. Lakhs)
A) Current maturities of long-term debts 48,663.01 79,989.28
B) Interest accrued but not due on borrowings 1,597.45 2,959.42
C) Unclaimed dividends 1,068.53 586.37
D) Employee benefits 28,783.43 27,328.63
E) Capital creditors 10,355.89 3,615.86
F) Derivatives not designated in hedging relationships 3,988.42 10,939.35
G) Derivatives designated in hedging relationships 586.07 336.21
H) Book overdraft in cash credit accounts - 66.62
I) Others* 69,751.61 71551.69
164,794.41 197,373.43
* Include:
Accrued expenses / liabilities 68,863.32 70,663.73

Limitations and assumptions for Future Profitability, Liquidity &

Efficiency
The Year ahead
Commercial Vehicle (C V) industry runs on three primary aspects viz.,

a. Growth in GDP, which is being driven well now with the GST reforms,
b. Growth in the infrastructure. The company expects that the investment thrust in
infrastructure will continue in 2018-19 also.
c. Growth in mining which is largely related to infrastructure.

All these three at present augur well for the CV industry.

In addition to this, two significant events are happening in the country:

a. More of hub and spoke is happening may be due to GST implementation.

b. This results in size of truck becoming larger

The Company is quite bullish that the infrastructure led demand will continue. The GDP will continue
to grow on the back of GST, the hub and spoke model will continue to play to your Company’s
favour, and the international markets is also expected to do well.
The industry view is that MHCV truck is likely to witness growth of around 10% in FY 2019 on top of a
14% growth in FY ’18. Over the medium term, the demand for the CVs will also be driven by gradual
acceptance of advance trucking platforms, progression to BS VI emission norms possibly by 2020
onwards and introduction of technologies, which may lead to advance purchases by let operators.
The Company is continuing to do well in domestic truck Business. But equally, the Company is
looking at other business segments covering LCV, Defence, After Market, Customer solutions to
grow them at a faster pace than the truck business so that this Company will be less prone to
cyclicity that the truck industry is known for.

Some of the concerns like increase in fuel price are expected not to have an adverse impact on the
MHCV industry. The increase is compensated to the operators in most of the contracts. Similar
concern was expressed on commodity price increases. The Company will mitigate this increase
through price increases, but the increases will be done only to protect the margins. The company
will not give away the margin for the sake of market share or for commodity price increases. The
company should strive to continue to maintain margins in double digits.

Your Company is launching two product platforms this year one is the high horse power range of
vehicles viz., tippers and tractors. Second is the world’s first 41 tonne with 5 axles with twin tyre lift.

Profitability
Company’s profitability improved consequent to increased volumes in financial year 2017-18 and is
expected to continue in the year ahead. The increased volumes were aided by the growth in GDP
which is being driven very well by the GST reforms and growth in infrastructure. The concept of hub
and spoke is expected to further amplify owing to GST implementation. This has resulted in the size
of trucks becoming larger and higher revenues. Sale volume of domestic truck was up by 22% in FY
2018, but the truck revenue was up by 37%. Improvement in demand off take in higher tonnage
vehicles comprising tipper, tractor trailer and multi axle vehicles has boosted volumes and profits for
the Company. This has also led to higher MHCV market share. Tighter control on material costs and
operating expenses combined with efficient working capital management will have significant
contribution to profit improvement during the year.

After 20 years, the Company’s debt rating has been upgraded by CARE ratings. During March 2018,
the Company’s financial rating has been upgraded from CAREAA to CARE AA+ with stable outlook.

Liquidity
The Company will continue with the “Cash and Carry” system of sales during the year which has
been effective since May 2009. This will enable the Company to better manage the increased
liquidity requirements. Previous year, Company has repaid long term loans of `1,055 Crores from
internal generation (`662 Crores by AL and `393 Crores by Foundries Division). The Company
manages its liquidity through rigorous weekly monitoring of cash flows.

SWOT Analysis
Strengths
The leader in domestic market: Ashok Leyland had a strong market share (28.6%) in the medium and
heavy commercial vehicle segment in FY2015. It is the 2nd largest manufacturer of commercial
vehicles in India, also it is the 4th largest manufacturer of buses in the world. Thus, the strong
market position in different domains gives the company a better brand image and wider customer
base.

Strong product portfolio: Ashok Leyland has forayed into a various segment of heavy, medium and
light vehicles which includes buses, trucks, defence vehicles, etc. The company also offers diesel
engines for industrial, marine and generator applications. The strong product portfolio expands the
customer base and market share.

Robust manufacturing capabilities: The strong manufacturing facilities of Ashok Leyland has spread
all over India. It also has facilities in the UK, Czech Republic, and the UAE. This helps the company to
maintain economies of scale.

Weaknesses
Heavily dependent on the domestic market: In FY 2015, Ashok Leyland generated 87.3% of its
revenues from the domestic market. This makes it vulnerable to any economic and political changes
in the country. This gives an advantage to its prime competitor Tata Motors which operates through
a wider revenue base geographically.

Termination of JV with Nissan: In 2016, a Japanese company, Nissan Motor Company terminated the
3 JVs signed with Ashok Leyland, ending 8-year-old business relationships. There were also lawsuits
filed against each other creating an unamicable atmosphere. Such instances can make the company
weak as it hurts the image of the company and affects the financial condition as well as operations.

Opportunities
Growing global automotive industry: The Global automotive industry has shown constant growth in
the recent years and thus creates an opportunity for Ashok Leyland to grab upon. The company
should focus on tapping the opportunities created in the global market, especially in the emerging
countries to take advantage of the growth in the industry and with it expand its footprint over the
globe.

Expanding Product portfolio: With its focus on research and development, Ashok Leyland should
look forward to expanding its product portfolio like it has done in the recent past by introducing
different heavy and medium commercial vehicles. This helps in expanding its market and provides a
competitive edge.

Exports: Many of the competitors have become wary of Ashok Leyland as it has entered exports of
its products in a big way and a bright future is expected of Ashok Leyland.

Threats
Intense competition: Ashok Leyland faces competition from companies like Tata Motors, Mahindra
& Mahindra, Eicher Motors, Marcopolo, etc. The government has allowed 100% foreign equity
ownership in manufacturing vehicles industry which also leads intensifying competition.

Environmental Regulations: The industry is subjected to constant changes and up gradation in the
environmental regulatory requirements. The company must comply with regulations regarding
emission levels, noise, safety and pollutant levels. Such regulations increase compliance costs which
could also affect the pricing strategy of the company.

Volatility in supply affects profitability: Some of the important commodities used in manufacturing
automobiles, including steel, aluminium, copper, zinc have been extremely susceptible to price
changes in the recent years because of the supply-demand difference. This affects the profitability of
the company directly.
Solvency Ratios
(*All the figures are taken from the Consolidated Financial Statements published by Ashok Leyland)

Debt to Equity Ratio

(IN RS. CRORES) FY16 FY17 FY18

LONG TERM 7,597.14 8876.42 10228.09
BORROWINGS
SHORT TERM 1093.02 1785.01 1919.19
BORROWINGS
SHAREHOLDER’S 5293.15 6392.94 7420.59
FUNDS
D/E RATIO 1.63 1.66 1.65

Total Debt to Total Asset Ratio

(IN RS. CRORES) FY16 FY17 FY18

LONG TERM 7,597.14 8876.42 10228.09
BORROWINGS
SHORT TERM 1093.02 1785.01 1919.19
BORROWINGS
TOTAL DEBT 8690.16 10661.43 12147.28
NON-CURRENT ASSETS 13797.49 15505.34 19096.43

CURRENT ASSETS 9165.65 11039.63 14421.55

TOTAL ASSETS 22963.14 33517.99 26668.32
RATIO 0.37 0.31 0.45

Interest Coverage Ratio

(IN RS. CRORES) FY16 FY17 FY18

EARNINGS BEFORE 2594.35 2882.05 3809.38
INTEREST & TAX
INTEREST/FINANCE 967.85 1048.79 1231.72
COST
RATIO 2.68 2.74 3.09
Liquidity Ratios
Quick Ratio
(IN RS. CRORES) FY16 FY17 FY18
TOTAL CURRENT 5,180.95 5,977.12 7,869.81
ASSETS
INVENTORIES 1,709.88 2,631.03 1919.19

TOTAL CURRENT 4,890.18 6,421.75 8,246.98

LIABILITIES
QUICK RATIO 0.73 0.52 0.75

Current Ratio
(IN RS. CRORES) FY16 FY17 FY18
TOTAL CURRENT 5,180.95 5,977.12 7,869.81
ASSETS
TOTAL CURRENT 4,890.18 6,421.75 8,246.98
LIABILITIES
CURRENT RATIO 1.06 0.93 0.95

Dividend Pay-out Ratio

(IN RS.) FY16 FY17 FY18
DIVIDEND PER SHARE 0.95 1.56 2.43

EARNINGS PER SHARE 1.37 4.3 5.34

DIVIDEND PAY-OUT 0.69 0.36 0.45

RATIO
Activity Ratios
Total Assets Turnover Ratio
(IN RS.) FY16 FY17 FY18
TOTAL ASSETS 12,773.75 14,040.07 16,586.08

NET SALES 18,937.30 20,140.13 26,247.91

TOTAL ASSETS 1.48 1.43 1.58

TURNOVER RATIO

Analysis: This ratio measures the efficiency of the firm in utilizing its Assets. A high ratio represents
efficient utilization of total Assets in generating sales. Since, the ratio has increased from 1.48 in
FY16 to 1.58 FY18, which shows that the company has started using its total assets well to generate
more revenue.

Fixed Assets Turnover Ratio

(IN RS.) FY16 FY17 FY18
FIXED ASSETS 4867.84 5176.67 5375.46

NET SALES 18,937.30 20,140.13 26,247.91

FIXED ASSETS 3.89 3.89 4.88

TURNOVER RATIO

Analysis: This ratio measures the efficiency of the firm in utilizing its Fixed Assets. A high ratio
represents efficient utilization of Fixed Assets in generating sales. The increase directly shows
efficient utilization of fixed assets to generate more sales.

Current Assets Turnover Ratio

(IN RS.) FY16 FY17 FY18
CURRENT ASSETS 5180.95 5977.12 7869.81

NET SALES 18,937.30 20,140.13 26,247.91

CURRENT ASSETS 3.65 3.36 3.33

TURNOVER RATIO

Analysis: This ratio measures the efficiency of the firm in utilizing its Current Assets. A high ratio
represents efficient utilization of Current Assets in generating sales. The ratio has decreased from
3.65 in FY16 to 3.33 in FY18 showing declining utilization of current assets, although overall the ratio
is maintained well by the company.
Inventory Turnover Ratio
(IN RS. CRORES) FY16 FY17 FY18
NET SALES 18,937.30 20,140.13 26,247.91

INVENTORIES 1625.01 2,631.03 1709.88

INVENTORY 11.65 7.65 15.35

TURNOVER RATIO

Analysis: This ratio describes the relationship between the cost of goods sold and inventory held in
the business. This ratio indicates how fast inventory/ Stock is consumed/ sold. A high ratio is good
for the company as can be seen in the year FY16 at a value of 11.65. However, lowering of ratio in
the year FY17 indicates that stock is not consumed/ sold or remains in a warehouse for a longer
period. Again, it is improved in the year FY18 to a value of 15.35.