bajaj- hero honda comparison

11
Financial Analysis of Bajaj Auto Ltd. & Hero Honda Motors Ltd.

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Page 1: Bajaj- Hero Honda comparison

Financial Analysis of

Bajaj Auto Ltd. &

Hero Honda Motors Ltd.

Page 2: Bajaj- Hero Honda comparison

30 % market share in motorcycle division Record Sale of 2.85 million in year 2009-10 PAT grew by 160 % In the year 2009-10 Got most popular 2 wheeler among youth award.Having its manufacturing units in Waluj(Aurangabad), Chakan(Pune), Patnagar.

Company Profile- Bajaj Auto Limited

Page 3: Bajaj- Hero Honda comparison

59 % market share in domestic motorcycle division A wide spread reach in rural India around 100000 villages PAT grew by 160 % In the year 2009-10 World’s No. 1 two wheeler company for the ninth consecutive year.NDTV Profit Business Leadership lifetime achievement award 2009.

Company Profile- Hero Honda

Page 4: Bajaj- Hero Honda comparison

Horizontal AnalysisBajaj Auto Limited

Item Mar '08 Mar '09 Mar '10 % increase 8-9

% increase 9-10

Reserves 1,442.91 1,725.01 2,783.66 19.55 61.37

Networth 1,587.59 1,869.69 2,928.34 17.76907 56.62169

Gross Block 2,994.68 3,350.20 3,379.25 11.87172 0.867112

Capital Work in Progress 34.74 22 41.5 -36.6724 88.63636

Inventories 349.61 338.84 446.21 -3.08058 31.68752

Sundry Debtors 275.31 358.65 272.84 30.27133 -23.9258

Cash and Bank Balance 56.07 136.8 104.2 143.9807 -23.8304

Current Liabilities 1,043.20 1,213.40 2,218.06 16.31518 82.7971

Provisions 834.04 1,224.15 2,248.72 46.77354 83.69644

•2008-09 : Reserves have increased due to Trasnfer from profit, Net worth has increased because of increase in the reserves,gross block increased due to buying air craft, Capital WIP & inventories decraesed due to trimmed operation, rise in sundry debtor due to export debtors, Current Liabilities increased due to VRS scheme,last year this expense was put to P & L but this year they accured it as per the acc std.15.•2009-10 : Reserves have increased due to Trasnfer From profit, balance of p& L and hedge gain..they accounted for last year loss , Net worth has increased because of increase in the reserves,gross block increased due to smaller buys, Capital WIP & inventories increased due to Raw material and finished good , decrease in sundry debtor due to tightening of debt policy , Current Liabilities increased due to credit from micro and sme, basis is removal of interest accrued due 45 day credit limit and timely payment, but must have increased the creditor.

Page 5: Bajaj- Hero Honda comparison

Horizontal AnalysisHero Honda

Item Mar '08 Mar '09 Mar '10 % increase 8-9 % increase 9-10

Reserves 2,946.30 3,760.81 3,425.08 27.65 -8.93

Net Block 1,156.26 1,573.71 1,658.78 36.1 5.41

Capital Work in Progress 408.49 120.54 48.14 -70.49 -60.06

Cash and Bank Balance 130.58 217.49 1,907.21 66.56 776.92

Total Current Assets 751.3 694.26 2,452.00 -7.59 253.18

Current Liabilities 1,324.98 1,678.93 3,965.69 26.71 136.2

Provisions 499.76 526.97 1,026.35 5.44 94.76

•2008-09 : Reserves have increased due to Good Profit & increase in general reserve , Net block has increased due to New plant -Increase in new buildings, machines and vehicles gross block increased due to buying air craft, Capital WIP decreased due to plant commissioned, cash and bank balances increased due to dividend was transferred to dividend current account, Current Liabilities increased due to dividend and dividiend tax.•2009-10 : Capital WIP & inventories decreased because no new commission happens. due to Raw material and finished good , cash and bank balances increased due to c, ash balance has interim dividend, Total current asset increased due to cash component, Current Liabilities increased due to interim dividend, Provisions increased Due to dividend increase and dividend tax

Page 6: Bajaj- Hero Honda comparison

Liquidity Ratios

Ratio Analysis Bajaj & Hero Honda

Current Ratio Quick Ratio

0.8

0.41

0.68

0.17

Bajaj Auto Ltd Liquidity Ratios2008 2009

Current Ratio Quick Ratio

0.41

0.22

0.62

0.51

Hero Honda Motors Ltd Liquidity Ratios

2009 2010

Page 7: Bajaj- Hero Honda comparison

Liquidity Ratio

Ratio Analysis Bajaj & Hero Honda

Inventory turnover Ratio Debtors Turnover Ratio

33.03

55.07

34.317

122

Bajaj Auto Ltd Liqidity ratio2008 2009

Inventory turnover Ratio Debtors Turnover Ratio

27.15

82.2

28.13

145.55

Hero Honda Motors LtdLiquidity Ratios

2009 2010

Page 8: Bajaj- Hero Honda comparison

Turnover Ratio

Ratio Analysis Bajaj & Hero Honda

Collection Period Inventory Holding Period

17.437

10.9

13.43

10.49

Bajaj Auto Ltd Turnover Ratio2009 2010

Collection Period Inventory Holding Period

0.15

0.44

0.08

0.43

Hero Honda Motors Ltd Turnover Ratios

2009 2010

Page 9: Bajaj- Hero Honda comparison

Turnover Ratio

Ratio Analysis Bajaj & Hero Honda

Fixed Assets turnover Ratio Total Assets Turnover Ratio

14.79

3.58

19.25

3.69

Bajaj Auto Ltd Turnover Ratio2009 2010

Fixed Assets turnover Ratio Total Assets Turnover Ratio

7.83

5.43

9.51

3.84

Hero Honda Motors Ltd Turnover Ratios

2009 2010

Page 10: Bajaj- Hero Honda comparison

Profitability & Solvency Ratios

Ratio Analysis Bajaj & Hero Honda

profitmargin return on assets

return on equity

debt to equity

0.095

0.61

0.377

0.021

0.133

1.164

0.614

0.019

Bajaj Auto Ltd Financial Ratios2009 2010

profitmargin return on assets return on equity debt to equity

0.07

0.372 0.38

0.84

0.14

0.794

0.71

0.457

Hero Honda Motors Ltd Financial Ratios

2009 2010

Page 11: Bajaj- Hero Honda comparison

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