FUNDAMENTAL OF FINANCIAL

MANAGEMENT

(MBBA130L)

AYUSH: M23BBAU0428
DEVANSH DEV: M23BBAU0304
EHSAAS PAL: M23BBAU0250
KUNAL AGGARWAL: M23BBAU02848
PRAKHAR ARNAV: M23BBAU0279

RATIO ANALYSIS ASSIGNMENT

COMPANIES:
1. MOTOROLA
2. GOOGLE

UNDER THE SUPERVISION OF FACULTY MENTOR

(Prof. NIVEDITA SRIVASTAVA)

School Of Management, Bennett University, Greater Noida, Uttar Pradesh, India

(October,2024)
 MOTOROLA (2022-23)

1. PROFITABILITY RATIO:
a) Gross Profit Margin Ratio:
= (Gross profit/ Revenue) * 100
= (Gross profit/ Revenue) * 100
Gross Profit= Revenue- COGS
= 9310.25- 1418.55
= 7891.7
Gross Profit Margin Ratio = (Gross profit/ Revenue)*
100
= (7891.7/ 9310.25)*100
= 85.73%

b) Net Profit Margin Ratio:

=(Net income/ Revenue)*100
=(505.98/ 9310.25) * 100
= 5.43%

2. LIQUIDITY RATIO:
a) current ratio = current asset/current liabilities
Current Asset:
= Inventories+ Investments+ Trade Receivables+
Cash & cash equivalents+ Bank balance+ Other
financial asset+ Other current asset+ Current Tax
asset+ Asset sale
= 863.54+ 70.82+ 410.76+ 239.15+ 574.06+
792.16+
35.69+ 517.55+ 8.04
= 3511.77

Current Liabilities:
= Borrowings+ Lease liabilities+ Trade payable+
Other financial liabilities+ Other current liabilities+
Provisions = 816.04+ 9.65+ 97.84+ 655.37+
253.75+ 729.14+
90.89
= 2652.68

Current Ratio= 3511.77/ 2652.68

= 1.32: 1

b) Quick Ratio= Quick Asset/ Current Liabilities

Quick Asset:
= Current asset- Other current assets- Inventories-
Current tax asset- Asset classified as sale

= 3511.77- 863.54- 35.69- 517.55- 8.04

= 2086.95

Quick Ratio= 2086.95/ 2652.68

= 0.78: 1

3. SHAREHOLDER RETURN:
a) Return on equity (ROE)= (Net income/ Shareholder
equity)* 100

= (505.98/ 4639.69)* 100

= 10.90%
 b) Return on Capital Employed= (EBIT/ Capital
employed)* 100

Capital Employed= Total asset- Current Liabilities

= 12823.33- 2652.68
=10170.65

Return on capital employed= (1703.78/ 11252.15)*100

= 10.91%

4. EFFICIENCY RATIO:
= a) Fixed asset turnoverRevenue/ Net fixed asset
ratio = 9310.25/ 9311.56
= 0.99 times

b) Total asset turnover ratio= Revenue/ Total asset

= 9310.25/ 12823.33
= 0.726
times
5. VALUATION RATIO:
a) Price earning= Market price per share/ EPS
ratio
Market price per share=
Market capitalization/ Total no. of outstanding share
= 22587 cr / 7.7268 cr
= 2923.19

EPS= 65.06

Price earning ratio= 2923.19/ 65.06

= 44.93 times
b) EV/ EBIT= Enterprise value/ EBIT

Enterprise value = Market Capitalization+ Total debt-

Cash& cash equivalents

= 22587+ 8183.64- 239.15

= 30531.49

EV/ EBIT= 30531.49/ 1109.97

= 27.5 times

MOTOROLA (2023-24)

1. PROFITABILITY RATIO:
a) Gross Profit Margin Ratio:
= (Gross profit/ Revenue)* 100
Gross Profit= Revenue- COGS
= 10918.05- 1618.94
= 9299.11
Gross Profit Margin Ratio = (Gross profit/ Revenue)*
100
= (9299.11/
10918.05)*100 =
85.17%
 b) Net Profit Margin Ratio:
=(Net income/ Revenue)*100
=(829.60/ 10918.05) * 100
= 7.59%

2. LIQUIDITY RATIO:
a) Current ratio = current asset/current liabilities
Current Asset:
= Inventories+ Investments+ Trade Receivables+
Cash & cash equivalents+ Bank balance+
Other financial asset+ Other current asset+ Current
Tax asset+ Asset sale

= 1067.53+ 99.83+ 460.40+ 97.20+ 680.46+

1308.45+
47.20+ 297.19+ 11.90
= 4070.16

Current Liabilities:
= Borrowings+ Lease liabilities+ Trade payable+
Other financial liabilities+ Other current liabilities+
Provisions
= 1000.74+ 10.25+ 208.47+ 600+ 265.82+
842.58+103.84
= 3032.40

Current Ratio= 4070.16/ 3032.40

= 1.34: 1
 b) Quick Ratio= Quick Asset/ Current Liabilities
Quick Asset:
= Current asset- Other current assets- Inventories-
Current tax asset- Asset classified as sale

= 4070.16- 297.19- 1067.53- 47.20- 11.90

= 2646.34

Quick Ratio= 2646.34/ 3032.40

= 0.87: 1

3. SHAREHOLDERNet income/
RETURN: Shareholder
a) Return on equity ( equity)* 100
(ROE)=
= (829.60/ 5353.39)* 100
= 15.49%

b) Return on Capital Employed= (EBIT/ Capital

employed)* 100
Capital Employed= Total asset- Current Liabilities
= 14284.55- 3032.40
=11252.15

Return on capital employed= (1703.78/

11252.15)*100
=
15.14%

4. EFFICIENCY RATIO:
a) Fixed asset turnover
ratio
= Revenue/ Net fixed asset
= 10918.05/ 10214.39
= 1.068 times

b) Total asset turnover ratio= Revenue/ Total asset

= 10918.05/ 14284.55
= 0.76 times

5. VALUATION RATIO: Market price per share/ EPS

a) Price earning=
Market price per share=
ratio
Market capitalization/
Total no. of outstanding share = 31501 cr / 7.7268 cr
= 4076.83

EPS= 107.50

Price earning ratio= 4076.83/ 107.50

= 37.92 times
b) EV/ EBIT= Enterprise value/ EBIT

Enterprise value = Market Capitalization+ Total debt-

Cash& cash equivalents

= 31501+ 8931.16- 97.20

= 40334.96

EV/ EBIT= 40334.96/ 1703.78

= 23.67 times

GOOGLE (2022-23)
 1. PROFITABILITY RATIO:
a) Gross Profit Margin Ratio:
= (Gross profit/ Revenue)* 100
Gross Profit= Revenue- COGS
= 1030.97- 129.32
= 901.65
Gross Profit Margin Ratio = (Gross profit/ Revenue)*
100
= (901.65/ 1030.97)*100
= 87.45%

b) Net Profit Margin Ratio:

=(Net income/ Revenue)*100
=(35.10/ 1030.97) * 100
= 3.40%

2. LIQUIDITY RATIO:
a) Current ratio = current asset/current liabilities
Current Asset:
= Inventories+ Investments+ Trade Receivables+
Cash & cash equivalents+ Bank balance+ Others+
Other current asset+ Current Tax asset
= 141.19+ 4.91+ 3.96+ 0.23+ 1.86+ 46.25+ 1.25
= 199.65

Current Liabilities:
 = Borrowings+ Lease liabilities+ Trade payable+
Other financial liabilities+ Other current liabilities+
Provisions
= 129.78+ 2.72+ 71.34+ 113.97+ 83.25+ 0.82
= 401.88

Current Ratio= 199.65/ 401.88

= 0.49: 1

b) Quick Ratio= Quick Asset/ Current Liabilities

Quick Asset:
= Current asset- Other current assets- Inventories-
Current tax asset
= 199.65- 141.19- 46.25- 1
= 10.96

Quick Ratio= 10.96/ 401.88

= 0.027: 1

Net 3. SHAREHOLDERincome/ Shareholder

RETURN: equity)* 100
a) Return on equity (
(ROE)= = (35.10/345.81)*
100
= 10.15%

b) Return on Capital Employed= (EBIT/ Capital

employed)* 100

Capital Employed= Total asset- Current Liabilities

 = 1795.34- 401.88
=1393.46

Return on capital employed= (135.04/ 1393.46)*100

= 9.89%

4. EFFICIENCY RATIO:
= a) Fixed asset turnoverRevenue/ Net fixed asset
ratio = 1030.97/ 1595.69
= 0.64 times

b) Total asset turnover ratio= Revenue/ Total asset

= 1030.97/ 1795.34
= 0.57
times

5. VALUATION RATIO: Market price per share/ EPS

a) Price earning=
ratio Market price per share=
Market capitalization/ Total no. of outstanding share
= 810 cr / 31.14 cr
= 26.01

EPS= 1.15

Price earning ratio= 26.01/ 1.15

= 22.61 times
b) EV/ EBIT= Enterprise value/ EBIT
 Enterprise value = Market Capitalization+ Total debt-
Cash& cash equivalents

= 810+ 1449.53- 3.96

= 2255.57

EV/ EBIT= 2255.57/ 135.04

= 16.70 times

GOOGLE (2023-24)

PROFITABILITY RATIO:
a) Gross Profit Margin Ratio:
= (Gross profit/ Revenue) * 100
Gross Profit= Revenue- COGS
= 307,394-133332
= 1,74,062
Gross Profit Margin Ratio = (Gross profit/ Revenue) *
100
(1,74,062/307,394)
*100 = 56.63%

b) Net Profit Margin Ratio:

= (Net income/ Revenue) *100
= (82,000/ 307,394) * 100
 = 26.70%

2. LIQUIDITY RATIO:
a) Current ratio = current asset/current liabilities Current Asset:
= Inventories+ Investments+ Trade Receivables+
Cash & cash equivalents+ Bank balance+
Others+ Other current asset+ Current Tax asset
= 229.01+ 100.13+ 4.16+ 32.71+ 0.24+ 4.54+
21.84+
2.05
= 394.68

Current Liabilities:
= Borrowings+ Lease liabilities+ Trade payable+
Other financial liabilities+ Other current liabilities+
Provisions
= 98.13+ 0.49+ 88.2+ 81.09+ 60.00+ 0.44
= 328.35

Current Ratio= 394.68/ 328.35

= 1.20: 1

b) Quick Ratio= Quick Asset/ Current Liabilities

Quick Asset:
= Current asset- Other current assets- Inventories-
Current tax asset

= 394.68- 229.01- 21.84- 2.05

= 141.78
 Quick Ratio= 141.78/ 328.35
= 0.43: 1

3. SHAREHOLDER RETURN:
a) Return on equity=
(ROE)

(Net income/ Shareholder

equity)* 100

= (62.88/ 887.43)* 100

= 7.08%

b) Return on Capital Employed= (EBIT/ Capital

employed)* 100

Capital Employed= Total asset- Current Liabilities

= 2462.38- 328.35
=2134.03

Return on capital employed= (196.89/ 2134.03)*100

= 9.23%

4. EFFICIENCY RATIO:
= a) Fixed asset turnoverRevenue/ Net fixed asset
ratio = 1163.59/ 2067.70
= 0.56 times

b) Total asset turnover ratio= Revenue/ Total asset

= 1163.59/ 2462.38
 = 0.47
times
5. VALUATION RATIO: Market price per share/ EPS
a) Price earning=
ratio Market price per share=
Market capitalization/ Total no. of outstanding share
= 1811 cr / 56.05 cr
= 32.3

EPS= 1.25

Price earning ratio= 32.3/ 1.25

= 25.84 times
b) EV/ EBIT= Enterprise value/ EBIT

Enterprise value = Market Capitalization+ Total debt-

Cash& cash equivalents

= 1811+ 1574.95- 32.71

= 3053.24

EV/ EBIT= 3053.24/ 196.89

= 15.50 times