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Ratio's Analysis on Fateh Textile Pvt. Ltd analysis on threes years Ratos....

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Acknowledgement

By the grace of Allah, the Almighty who enabled me to complete this very project by bestowing that zeal and commitment that was ever needed. I express my deepest gratitude to our Mr. Faisal Aziz, for his invaluable guidance and blessings. I am again appreciative to Mr. Faisal Aziz for providing me with an environment to complete my project successfully. I would like to thank my entire Supporter who supported to me during the entire course of this project work. The report entitled RATIO ANALYSIS is an outcome of hard work put in to the task assigned to me. I am student of MBA (Morning) were assigned an interesting yet constructive task. After that, we had to prepare Ratio analysis my selves, explain the Ratios and explore their marketing Position. Finally, I were asked to present the entire work in form of a report to convey what and how i accomplished the task and what I learnt from it. There has been a detailed research undertaken to put it to the form now available. This is only a compendium of facts, but only the area that we are considered were approached and explained in the easiest manner. I have tried to avoid any error but nevertheless, some may have occurred. Who would point out any mistake in this message or give any suggestion for the improvements in the next Report.

1

Company Information

Board of Directors:Mr. Gohar Ullah Mr. Asad Ullah Barkat Mr. Humayun Barkat Mr. Maqsood Ahmed Khan Mr. Muhammad Saleem Mr. Muhammad Ayub Mr. Soofi Taj Muhammad Chairman Chief Executive NIT Nominee

Share Registrar:M/s Progressive Management Services (Pvt.) Ltd. 10th Floor, Mehdi Towers, A-115, S.M.C.H.S. Shahrah-e-Faisal, Karachi. Tel: 021-34526983, Fax: 021-34526985 Email: pmsl-rta@hotmail.com Web: www.ftml.com.pk

Chief Financial Officer:Mr. Muhammad Saleem

Company Secretary:Mr. Muhammad Nadeem Aqeel

Audit Committee:Mr. Gohar Ullah Mr. Maqsood Ahmed Khan Mr. Soofi Taj Muhammad Chairman Member Member

External Auditor:M/s. Rahim Jan & Co. Chartered Accountants, Karachi.

Legal Advisor:Ansari & Ansari, Advocates.

Bankers:Allied Bank Limited Askari Bank Limited Deutsche Bank Habib Bank Limited Meezan Bank Limited Metropolitan Bank Limited MCB Bank Limited National Bank of Pakistan Standard Chartered Bank

Registered Office:A/4, Hali Road, S.I.T.E., Hyderabad-Sindh. Phone No.: 022-3880463-66 Fax No.: 022-3880042 & 514

Liaison Office:114-A, S.M.C.H.S., Near Mehdi Tower, Shahra-e-Faisal, Karachi

Mills:Hali Road S.I.T.E., Hyderabad-Sindh, Pakistan.

2

Companys Vision & Mission Statement

VisionFateh to be the first choice of customers in international Textile market and to make the Fateh brand globally known For quality products with innovative design capabilities.

MissionTo be a market leader in textile specially in bed wear items. His mission is to exceed their customers expectations by Reducing quality products employing state-of-art/latest Technology, international best practices and an integrated Approach to manufacturing technology, contributing to the Economic growth of the nation by increasing exports and Earning foreign exchange for our country.

3

Balance Sheet Statement

Fateh Textile, Balance Sheet Statement, For the year ended June, 2008-09-10 (Rs.) 2010Property & AssetsFIXED ASSETS Tangible Operating Fixed AssetsCAPITAL WORK IN PROGRESS

2009

2008

2,003,222,631 276,563,379 525,701,132 3,817,546

1,994,413,077 112,655,825 524,357,579 3,817,546

2,140,103,181 0 526,032,414 3,817,546

LONG TERM INVESTMENT LONG TERM DEPOSIT

CURRENT ASSETSStores, Spares and loose Tools Stock-in-trade Trade Debts Advances, Deposits and Payments Other Receivables Cash and Bank Balances 29,488,600 1,303,098,761 5,655,316,029 35,778,121 230,822,111 13,412,062 7,267,915,683 29,368,562 1,761,621,326 4,949,818,505 40,525,638 190,906,763 11,005,163 6,983,245,958 30,127,609 2,125,628,131 3,848,163,811 51,861,477 155,281,029 12,598,265 6,223,660,322

Total Assets

10,077,220,370

9,619,589,985

8,893,613,464

4

Balance Sheet Statement

2010CAPITAL & LIABILITIESShare Capital & Reserves Authorized Capital 2,000,000 Ordinary Shares Of Rs. 10/= each General Reserve Investment Revaluation Reserve

2009

2008

20,000,000

20,000,000 12,500,000 1,481,000,000 420,180 43,231,812 1,537,151,992 1,145,743,347 51,000,000 1,235,000,000 28,840,614 8,380,600 26,000,000 34,380,600

20,000,000 12,500,000 1,481,000,000 2,095,014 10,455,450 1,506,050,464 1,205,599,699 51,000,000 1,390,786,692 75,619,694 9,082,328 26,000,000 35,082,328

Issued, Subscribed and Paid up Capital 12,500,000

1,481,000,000 1,763,733 Unappropriated Profit Carried Forward 46,603,959 1,541,867,692 SURPLUS ON REVALUATION OF FIXED ASSESTS 1,091,872,631 LOAN SUBORDINATE TO EQUITY LONG TERM LOANS 51,000,000 1,235,000,000

LIABILITIES AGAINS ASSETS SUBJECT TO FINANCE LEASE 11,542,926 DEFERRED LIABILITIES Gratuity and staff benefits Deferred Taxation 10,472,900 41,000,000 51,472,900

CURRENT LIABILITIESTrade and Other payable Mark-up and Secured Finances Short Term Running Financing 398,375,451 1,827,696,850 3,152,781,660 Current portion of long term liabilities 683,441,466 Provision for Taxation 32,168,795 6,094,464,222 438,766,033 1,296,503,082 3,153,938,733 667,053,179 31,212,407 5,587,473,434 442,581,324 980,385,137 2,708,582,466 465,326,470 32,599,190 4,629,474,587

5

Income StatementTotal Liabilities & Equities 10,077,220,370 9,619,589,985 8,893,613,464

Fateh Textile, Income Statement For the year ended June, 2008-09-10 (Rs.) 2010Sales Less: Cost of Good Sold Gross ProfitLess: OPERATING EXPENSES

20093,050,988,913 2,971,848,461 (2,971,848,461) 79,140,452 61,659,552 19,022,097 (80,681,649) (1,541,197) 504,247,664 502,706,467 428,825,845 34,854,261 (463,680,106) 39,026,361 5,000,000 (5,000,000) 34,026,361

20084,716,081,695 4,272,302,110 (4,272,302,110) 443,779,585 60,112,331 49,719,470 (109,831,801) 333,947,784 113,287,516 447,235,300 390,108,507 19,571,408 (409,679,915) 37,555,385 29,500,000 (29,500,000) 8,055,385

2,442,558,955 2,423,990,825 (2,423,990,825) 18,568,130 60,216,029 18,450,179

Administration Expenses Selling Expenses

Total Operating Expenses (78,666,208) Operating Loss/Income Other Income Operating Profit Less: Financial Expenses Other Charges Total Expenses Profit before Taxation Less: Taxes (60,098,078) 655,745,201 595,647,123 561,196,888 6,728,088 (567,924,976) 27,722,147 23,100,000 (23,100,000) Profit after Taxation 4,622,147

6

Net Income

Financial Ratio Analysis 4,622,147

34,026,361

8,055,385

Graphical Representation RatiosRatios FormulaCurrent assets Current liabilities Current assets Inventory Current liabilities Cost of goods sold Inventory Accounts receivable Average sales per day Accounts payable Average purchases per day Sales Total assets Total liabilities Total assets Earnings before interest and taxes Interest Earnings before interest and taxes + Lease payments Interest Lease Payments Gross profits Sales Operating profits Sales Earnings available for common stockholders Sales Earnings available for common stockholders Number of shares of common stock outstanding Earnings available for common stockholders Total assets Earnings available for common stockholders Common stock equity Market price per share of common stock Earnings per share Market price per share of common stock Book value per share of common stock

2010

2009

2008

Industry Avg.

Cross Sectional

LiquidityCurrent ratio Quick (acid-test) ratio 1.19% 0.97 1.25% 0.93 1.34% 0.88 1.85% 1.05 1.55% 0.92

ActivityInventory turnover Average collection period Average payment period Total asset turnover 1.86 845 Days 88.61 Days 0.24 1.68592.16

2.00297.83

8.60 35.5 Days 46.4 Days 0.74

9.21 36.9 Days 61.6 Days 0.80

Days 65.69 Days 0.31

Days 42.63 Days 0.53

DebtDebt ratio Times interest earned ratio Fixed-payment coverage ratio 0.84% 1.06 1.13 0.84% 1.17 1.48 0.83% 1.14 1.78 0.30% 8.0 4.2 0.20% 7.3 4.2

ProfitabilityGross profit margin Operating profit margin Net profit margin Earnings per share (EPS) Return on total assets (ROA) Return on common equity (ROE) 0.76%(2.46%)

2.59%(0.05%)

9.4% 7.08% 0.17% 6.44 0.09% 0.53%

0.25% 0.10% 0.05% 1.50 0.04% 0.06%

0.27% 0.12% 0.062% 2.20 0.05% 0.06%

0.19% 3.70 0.04% 0.38%

1.11% 27.22 0.35% 2.21%

MarketsPrice/earnings (P/E) ratio Market/book (M/B) ratio 30.54 11.3 4.15 11.3 17.52 11.3 11.2 1.16 10.5 1.08

7

Quick Ratio1 0.95 Ratios 0.9 0.85 0.8 1 Year 2010 2009 2008 2010 2009 2008Ratios 1.35 1.3 1.25 1.2 1.15 1.1

Current Ratio2008 2009 2010

Inventory Turnover2.5 2 Ratios 1.5 1 0.5 0 2010 2009 2008

1 Year 2010 2009 2008

1 Year 2010 2009 2008

Average Collection Period1000 800Collection Days

Average Payment Period100 2010 2009 2008

Total Asset Turnover0.6 0.5 0.4 Ratios 0.3 0.2 0.1 0 2008 2009

2010 2009 2008Payment Days

80 60 40 20 0

600 400 200 0

2010

1 Year

1 Year

1 Year 2010 2009 2008

2010

2009

2008

2010

2009

2008

Debt Ratio0.85 0.845 0.84 Ratios 0.835 0.83 0.825 0.82 2010 2009 2008

Time Interest Earned Ratio1.2 1.15 Ratios 1.1 1.05 2010 2009 2008

Fixed Payment Coverage Ratio2 1.5 Ratios 1 0.5 2009 2010 2008

1 Year

1

1 Year 2010 2009 2008

0

1 Year 2010 2009 2008

2010

2009

2008