Ratio Analysis Tata Motors
Ratio Analysis Tata Motors
Index
1 Input Data
2 SWOT
3 IndustryAnalysis
4 Liquidity Ratio
5 Asset Management Ratio
6 Debt Management Ratio
7 Profitability Ratio
8 Market Value Ratio
Input Data 10000000 Rs. in Crore
Company Name Tata Motors
Industry Automobile Industry
Year 2010 2009
Current asset 7080.88 4577.26
Current Liability 14609.16 8597.97
Sales 38364.10 28568.21
Inventory 2935.59 2229.81
Acc. Recivables 2391.92 1205.52
Net fixed Asset 11203.89 7645.27
Total Asset 33100.02 26425.64
Net Income 31414.77 23877.29
Total Debt 35192.36 34,973.85
EBIT 4853.83 1752.70
Interest 1103.84 673.68
EBITDA 6031.73 2678.41
Lease Payment 0.02 0.18
Princ. Payment 0.00 0.00
Market Price per share 813.00 281.50
Common Equity 46.37 41.31
Basic earning per share 42.37 22.7
Dividend per share 15 6
Book value per share 26.2 23.8
Cash flow per share 1.859461286313 -28.698463733
Industry Analysis
Investment Scenario
It is expected that by the end of 2011 Indian automobile sector will be investing huge amount about Rs.30000 crores. For exam
investement of Rs. 2000 crores. Not only the Indian companies but also foreign players like Huyndai are coming up with the in
Growth trends
At present the Industry is enjoying a growth rate of 14-17% per annum, with domestic sales growth rate at 12.8%. The growth
rate indicates that by 2012 India will overtake Germany and Japan in sales volumes.
Key players
Ashok leyland
Royal enfield
Audi AG
Baja Auto
Skoda Auto India
Kinetic motor co. ltd.
Bentley motors ltd.
Chevrolet
Swaraj mazda ltd.
Mahindra & Mahindra ltd.
Eicher motors
Tata motors
Mercedez benz
Mitsubishi motors
Toyota kirloskar motors
HMT tractors
Yamaha motors
Honda motors co. ltd.
Hyundai motors
BMW
Sonalika tractors
Lamborghini suzuki motors
LML india
Tafe tractors
Maruti suzuki india ltd.
Escort ltd.
Fiat india pvt. ltd.
Force motor
Ford motors
TVS motor co.
Reva electric co.
Hindustan motors
Ashok leyland
Royal enfield
Audi AG
Baja Auto
Skoda Auto India
Kinetic motor co. ltd.
Bentley motors ltd.
Chevrolet
Swaraj mazda ltd.
Mahindra & Mahindra ltd.
Eicher motors
Tata motors
Mercedez benz
Mitsubishi motors
Toyota kirloskar motors
HMT tractors
Yamaha motors
Honda motors co. ltd.
Hyundai motors
BMW
Sonalika tractors
Lamborghini suzuki motors
LML india
Tafe tractors
Maruti suzuki india ltd.
Escort ltd.
Fiat india pvt. ltd.
Force motor
Ford motors
TVS motor co.
Reva electric co.
Hindustan motors
SWOT
Strengths
>TATA motors is market leader in Automobile Industry with high market
share.
>TATA Motors Company have huge employee base.
>TATA motors employee productivity percentage is higher.
>TATA motors produce low price car with low fuel consumption.
>TATA motors is the reputable brand in Indian Industry.
>Tata Motors Limited is India’s largest automobile company
>The company’s dealership, sales, services and spare parts network
comprises over 3500 touch points.
>Tata Motors has been aggressively acquiring foreign brands to increase its
global presence.
>The research and development department of TATA motors is very
strong.
>TATA motors posses High corporate responsibility.
Opportunity
>TATA motors can take the advantage of their low cost car by entering into
third world countries where people have low purchasing power.
>TATA motors should focus in developing luxury cards.
>TATA motors can introduce more safety features in vehicles to gain more
customer satisfaction.
>Joint ventures in other countries allow TATA motors to easily enter into
new market.
SWOT
Weakness
>Return on Investment on TATA motors shares in low.
>TATA motors is not able to meet safety standards in their vehicles.
>The domestic sales of the company are not up to the mark.
>Tata has not got a foothold in the luxury car segment in its domestic
market.
Threats
>TATA motors have low cost advantage over its competitors, once the
competitors find out the low cost production methodology then there will no
competitive advantage.
>Other companies are starting to compete for some of this market share. In
fact, the Pakistan’s Transmission Motor Company has built a basic four-
wheeler for only $2,100. This car is considerably cheap and the Pakistan
Transmission Motor company started exporting them to Sudan, Qatar, and
Chile. This is going to be the beginning of new emerging car manufactures
that will be producing low priced cars.
>The major challenge for TATA motors is the rising prices of steel, Aluminum
and plastic which is heavily used in vehicle manufacturing.
>The low safety standards can impact the sales.
Liquidity Ratio
2010 2009 Change
Current Ratio= Current Asset/Current liability 0.484688 0.532365 -0.047678
Analysis
Quick ratio or Acid test= Current Asset-Inventory/Current liability 0.283746 0.273024 0.010722
Analysis
Asset Management Ratio
2010 2009 Change
Inventory turn over ratio= Sales/Inventory 13.06862 12.81195 0.256668
Analysis
Days Sales out standing(DSO)= Acc. Reci./Avg. Sales per year 22.75697 15.40225 7.35472
Analysis
Fixed Asset turnover= Sales/Net fixed asset 3.424177 3.736717 -0.31254
Analysis
Total asset turnover= Sales/Total asset 1.159036 1.081079 0.077956
Analysis
Debt management ratio
447.0323
19.2028