hero honda project23
TRANSCRIPT
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Company Analysis Report Of
HERO HONDA
By,
M.RAMESH BABU(MBA)M.RAMESH BABU(MBA)
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LOGO
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Chapter 1
Company
Company
Profile &Profile &subsidariessubsidaries
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COMPANY PROFILE & INTRODUCTION:
Hero is the brand name used by theMunjal brothers in the year 1956 with theflagship company Hero Cycles.
The joint venture between India's Hero
Group and Honda Motor Company, theyare related to Jagdish Lal Munjal. During the 80s, Hero Honda became the
first company in India to prove that it waspossible to drive a vehicle without
polluting the roads. As Brijmohan Lall Munjal, the Chairman,Hero Honda Motors succinctly points out.
'Fill it - Shut it - Forget it.
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Over 20 million Hero Honda two wheelers
tread Indian roads today. These are almostas many as the number of people in Finland,Ireland and Sweden put together!.
Hero Honda has consistently grown at
double digits since inception; and today,every second motorcycle sold in the countryis a Hero Honda. Every 30 seconds, someonein India buys Hero Honda's top -selling
motorcycle Splendor.
Hero Honda bikes currently roll out from itsthree globally benchmarked manufacturingfacilities. Two of these are based atDharuhera and Gurgaon in Haryana and the
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These plants together are capable of
churning out 3.9 million bikes peryear.
Hero Honda is worlds third largest
two wheeler maker.
By 2002 Hero Group had sold 86million bicycles producing 16000bicycles a day.
Today Hero Honda has an assemblyline of nine different models ofmotorcycles available. It holds the
record for most popular bike in theworld b sales for Its S lendor model.
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Chapter 2Board of Directors & Products &
Awards
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BOARD OF DIRECTORS:
Mr. Brijmohan Lall Munjal - Chairman& Whole-time Director.
Mr. Pawan Munjal - Managing Director
& CEO.
Mr. Toshiaki Nakagawa - JointManaging Director
Mr. Sumihisa Fukuda - Technical
Director.
Mr. Om Prakash Munjal - Non-
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7 Mr. Masahiro Takedagawa Non-executive Director
8 Mr. Satoshi Matsuzawa
(Alternate Director to Mr. Takashi Nagai)
Non-executive Director
9 Mr. Pradeep Dinodia Non-executive & Independent Director
10 Gen.(Retd.) Ved Prakash Malik Non-executive & Independent Director
11 Mr. Analjit Singh Non-executive & Independent
Director
12 Dr. Pritam Singh Non-executive & Independent Director
13 Ms. Shobhana Bhartia Non-executive & Independent Director
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PRODUCTS
Hero Honda CD 100
Hero Honda CD 100 SS
Hero Honda CD Dawn
Hero Honda Splendor
Hero Honda Splendor+
Hero Honda Super Splendor
Hero Honda CD Dawn
Hero Honda Joy
Hero Honda Street
Hero Honda CBZ
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PASSION PASSION PLUS KARIZMA ACHIEVER PASSION PRO
SPLENDOR NXG HERO HONDA PLEASURE GLAMOUR HUNK
CBZ EXTREME
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PRODUCTS:
HERO HONDA CD100
HERO HONDA JOY
HERO HONDACD DAWN
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HERO HONDA SLPENDORHERO HONDA SLPENDOR PLUS
HERO HONDA PASSION PLUS HERO HONDA PASSION
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CBZEXTREME
CBZ
KARIZMA
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AWARDS:
Awards & Recognitions2008NDTV Profit BusinessLeadership Award 2008 - Hero Honda Wins the Coveted "NDTVProfit Business Leadership Award 2008.
Top Gear Design Awards 2008 - Hunk Bike of the Year Award NDTV Profit Car India & Bike India Awards - NDTV Viewers
Choice Award to Hunk in Bike category
India Times Mindscape and Savile Row ( A Forbes GroupVenture ) Loyalty Awards - Customer and Brand LoyaltyAward in Automobile (two-wheeler) sector
Asian Retail Congress Award for RetailExcellence (Strategies and Solutions of business innovation andtransformation) - Best Customer Loyalty Program in Automobilecategory
NDTV Profit Car India & Bike India Awards - BikeManufacturer of the year
Overdrive Magazine - Bike Manufacturer of the year TNS Voiceof the Customer Awards:No.1 executive motorcycle SplendorNXG
No.1 standard motorcycle CD Deluxe
No. premium motorcycle CBZ Xtreme
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AWARDS
2007The NDTV Profit Car India & Bike India Awards 2007 inthe following category:1.Overall "Bike of the Year" - CBZ X-treme
2."Bike of the Year" - CBZ X-treme (up to 150 cccategory)
3."Bike Technology of the Year" - Glamout PGMFI.
2006 No. 1 in automobile industry by TNS Corporate
Social Responsibility Award.1. Hero Honda Splendor rated as India's most
preferred two-wheeler brand at the Awaaz ConsumerAwards 2006.
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CHAPTER 3
RATIO
ANALYSIS
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Liquidity Ratios.
1)CURRENT RATIO:
CURRENT ASSETS
CURRENT LIABILITIES
Interpretation:
The ideal ratio 2:1 . The liquidity position of the company is notsatisfactory because it is not reached the ideal ratio 2:1 . Thecompany should increase the current assets and decrease thecurrent liabilities.
2005 2006 2007 2008
0.31 0.51 0.62 0.57
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Quick Ratio:
Current assets inventories.
Current liabilities
Interpretation:the liquidity position of the company is not satisfactorybecause the ratio is decrease and not reached the ideal ratio1:1 the company should increase quick assets such as cashand bank balance and decrease the current liabilities.
2005 2006 2007 2008
0.11 0.30 0.36 0.33
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LEVERAGE RATIOS:LEVERAGE RATIOS:
1)Debt equity Ratio
2)Proprietary Ratio
3)Fixed Asset Ratio
4)Interest Coverage RatiO
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Debt Equity Ratio:
Long term debts/Equity share holder funds.
InterpretationInterpretation:
The Ideal Ratio is 2:1.The solvency position ofthe company is satisfactory but it should decreasethe loans such as secured and unsecured. It shouldincrease the reserves and share capital also.
2005 2006 2007 2008
0.14 0.09 0.07 0.04
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Proprietary Ratio:
Net WorthNet Worth//Total AssetsTotal Assets
Interpretation:
These ratio is the indicative of strongfinancial position of business . The higher theratio , the better it is. but the company
Should increase the shareholders funds.
2005 2006 2007 2008
0.83 0.87 0.89 0.92
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Fixed Assets Ratio:
Fixed Assets
Net worth
Interpretation: This ratio is satisfactory and the ideal ratio is
0.67 and it will never be more than 1 , thelong term funds are used to buy or acquirethe fixed assets.
2005 2006 2007 2008
0.42 0.45 0.51 0.50
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Interest coverage Ratio:
PBIT/Fixed Interest Charges
Interpretation:
The ideal ratio is 6. This Ratio indicates whether abusiness is earning sufficient profits to pay theinterest charges. This ratio is not satisfactory andcompany should increase the sales and profits , to
pay the interest charges for the long term debts.
2005 2006 2007 2008
117.74 231.38 55.20 40.38
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Turn Over Ratios
1)inventory holding periods
2)working capital turnover
3)inventory turnover ratio
4)fixed assets turnover ratio
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Inventory Holding PeriodInventory Holding Period::
No . Of Days In Years/S.T.RNo . Of Days In Years/S.T.R
Interpretation: The Inventory turnover ratio also be
expressed in terms of no. of days (or) months it takes
for the stock to get converted into sales. Here thecompany is satisfactory and company has to workhard to have more sales
2005 2006 2007 2008
11.38days 10.58 10.42 11.93
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Working Capital TurnOver RatioWorking Capital TurnOver Ratio
Net Sales/WorkingCapital
Interpretation:
The Company should increase the sales andalso increase the working capital i.e.,
increase the current assets and decreasecurrent liabilities .
2005 2006 2007 2008
-7.85 -11.75 -17.49 -11.64
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Inventory TurnOver Ratio:
CGS/Avg. Inventory
Interpretation:The ideal ratio is 8. the company should control the cost
of goods sold expenses and increase the sales in orderto increase the ratio.
2005 2006 2007 2008
31.80 34.02 34.56 30.17
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Fixed Assets Turn Over Ratio:
TurnOver/ Fixed AssetsTurnOver/ Fixed Assets
Interpretation:
The ideal ratio is 5. the ratio is decreasing from year to yearand we should increase the sales up to the maximum level andwe should use the fixed assets up to full 100% capacity.
2005 2006 2007 2008
10.38 8.77 7.30 6.67
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Profitability Ratios:
1)Gross Profit Ratio
2)Operating Ratio
3)Earning per share
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EARNING PER SHARE:
2005 2006 2007 2008
RS.40.59 RS.48.64 RS.42.96 RS.48.47
Interpretation :The profits of the company are
increasing slightly and we should increase thesales and we should decrease the cost of goodssold , operating expenses. The shareholdersreturns on their investment is increasing year toyear
PAT-Preferencedividends
No. of Equityshares
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Gross profit ratio:
gross profit X 100Sales
Interpretation:The profitability position of the company isThe profitability position of the company is
satisfactory because of the Gross profit ratio issatisfactory because of the Gross profit ratio isincreasing from year to year but it is not enoughincreasing from year to year but it is not enoughthe company should control the cost of goodsthe company should control the cost of goodssold expenses and increase the sales.sold expenses and increase the sales.
2005 2006 2007 2008
15.91% 15.91% 12.34% 13.46%
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Operating Ratio:
CGS + Operating Exp X100
Net Sales
Interpretation:
The company had controlled the operating expenses thatswhy the ratio is decreased ,the lower the ratio the better it is,the company should continue this performance in the futurealso. It is satisfactory .
2005 2006 2007 2008
85.30% 85.40% 89.07% 88.09%
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Chapter 4
STRENGHTS & Competitors
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Strenghts
WorkersWorkers&Wide&Widedistributiondistribution
Sales & trust bySales & trust byconsumersconsumers ProfitsProfits
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COMPETITORS
BABAJ
YAMAHA
TVSSUZIKI
HONDA
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Thank you
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Queries?