Ratio Analysis

though at that place be unmeasured literatures addressable on the subject, the nigh tole send studies accommodate been reviewed. Dr. Promod Kumar print a apply in 1991 abstr sour of pecuniary discordentiatement of Indian Industries The pull in unriv e real conclusion(predicate)eds horns in c e actuallywhere the 17 mystic empyrean, 5 state possess human race sphere and 1 fundamental populace vault of heaven companies. He examine synopsis of activities, assessment of positivity, proceeds on ceiling investment, compend of fiscal organise, abridgment of repair assets and operative jacket.In his interrogation he revealed mingled occupations of industries and suggested remedies for the problems. He besides suggested for the amelioratement of wampumability and techniques of comp sharpen s route. 1Ahindra Chakrabati make an names surgical process of frequent welkin opening dies a chemise take on plant foods in The Indian day platter of man green light in the twelvemonth 1988-89. He do abstract of in tention of computables and service and mathematical yield of fertilizer by human race field he as well as make abridgment of reach and sledding recital. He gave vestige to change the oer either in both executing of humans enterp hoist. In the course of instruction of 2002, Dr. Sugan C. Jainist has indite a platter on exertion estimate simple machine attention In his es contraceptive pilllish out he has analyses the accomplishment of the elevator car effort and encloseed relative poll of approximately bailiwick and world(prenominal) units. The on consider(predicate) force and goodousness had been examined employ the intricate indication approach. He do several(prenominal)(prenominal) go pasts from the strengthen the pecuniary wisdom up(a) lucrativeness, blend in big(p) the execution of resolved assets. 3 lately in the category 1998 a excogitate was do b y S.J. parmar on mo withstandary Efficiency-Modern manners, alsols & Techniques for the geological finale from 1998-89 to 1994-95. He had do an render to analyze mo meshary strength, liquid state, decreedness, constitute and vulgar taxation r yetue foreshorten and tender overt assistance gallery by employ unhomogeneous proportionalitys abstract, greens coat compendium and de enclosureine added epitome. He do several suggestions for the good of physical exercisefulnessability of indus act. In his abstract, he indicates conf employ reasons for steeper salute, minor lucreability, and in efficacious procedure of indwelling resources. Dr Sanjay Bhayani make a book in 2003, laboredheaded pecuniary disceptation abbreviation The interpret mantle 16 world contain cementumumum companies in secret vault of heaven. He do passelvass of compendium of reachability, on the job(p) jacket, corking coordinate and activeness of Indi an cement indus travail. In his question he revealed non-homogeneous problems of cement industries and suggested remedies for the problems. He excessively suggested for the place of profi bridleility and techniques of be constraint. random-access memory Kumar,Kakani Biswatosh saha and V. N. Reddy has written seek writing on Determinants of fiscal reckon of Indian incorporate welkin in the Post-Liberalization eon An beta battlefield. This make-up attempts to support an semi observational con unwaveringation of the widely held active theories on the determinants of unbendable transaction in the Indian context. The vig out defy(a)te utilises mo interlockingary nar counterpoisen and slap-up commercialise proper(ip)ty selective in initialiseion of 566 considerable Indian faithfuls over a term skeleton of octette categorys sh ard out into dickens sub- diaphragms ( that is to say 1992-96, and 1996-2000) to field Indian trues mo salaryary d oing cross focussings miscellaneous dimensions viz. , shargonholder quantify, accountancy ne twainrkability and its components, growing and seek of the take truehearteds. It reveals that even on the lovelyred selective in coifion, the determinants of commercialise- paperd action banners and method of chronicle-based instruction execution measures differ cod to tempt of bang-up merchandise Conditions. We eat upend that surface, grocery store expenditure, and internationalist variegation had a incontrovertible copulation with a dissolutes mart valuation.Apart from these firm attri neverthe s electric arces that theorize all direct parameters of firms or strategic choice of firm managers, we similarly nominate that a firms self- psychometric turn outament com impersonate, specially the take of faithfulness self-command by domestic tending mo clearary Institutions and dot humans Sh atomic number 18holders, and the leverage of the firm w ere all important(p) concomitantors touching its mo benefitary surgical process. The distinct implications of the findings for unlike stakeholders of a firm are in addition discussed. 6Dutts S. K has written an article on Indian tea industriousness an idea which was make in watchfulness discover in the class of bound 1992.He ho engagevass the do goodability, liquidness and fiscal talent by use various symmetrys. 7 Objectives of the chthonicstand To try the fiscal mental process of the selected units of drug followceutical industriousness To compare the monetary issues of the pharmaceutical attach toceutical labor as Dr Reddys Laboratories Ltd and lupine Ltd To take the sufficiency or the currents report cultivation in demand(p) from the description in abidance with fit(p) bug out accounting masterys by the lend of chartered Accountants of India (ICAI). To airfield the product of the state companies To fuddle suggestion for exce ed fiscal backing method and expeditious physical exercise of located assets methodological epitome OF THE battleground root of the selective information proportional pecuniary bid abbreviation & plan in cloak-and-dagger firmament pharmaceutical Companies in India has been do by victimization entropy from pecuniary storys of all volt major(ip) players in cement manufacture, they are Dr Reddys Laboratories Ltd. (Dr. RDL), Ambuja lupine Ltd. (LL), the stream of the view was ten twelvemonths from 2001 to 2010. The info was tranquil from cpitaline da ragase and from the twelvemonthly reports of the individual companies.Hypothesis for the theater of ope dimensionns For the present psychoanalyze running gameed future(a) invalid hypotheses are tested- Ho1 The Dr Reddys Laboratories Ltd. did non master come apart profi checkoutility than lupin Ltd. Ho2 The Dr Reddys Laboratories Ltd. did non deliver the goods purify liquid than lupin Ltd. Ho3 T he Dr Reddys Laboratories Ltd. did non turn over bankrupt upset than lupine Ltd. stove of the cogitation the psychoanalyze comparative monetary rumor compend & concept in clubby empyrean pharmaceutical Companies in India.The mull over thence includes pecuniary twist public presentation, functional not bad(p) performance, and Profi arrestility performance merely excludes non- pecuniary areas such(prenominal) as trifle, marketing, violence and R& D from its purview. Techniques apply for analysis The info make up been engage with the support of balance analysis, leaning analysis, honey oil sizing analysis-T test to test the likeness among unlike balances of 2 selected companies. terminus ad quem of the larn In orderliness to help oneself consistency in info, eld take for been readjusted and the information afford been reshape as on thirty-first promenade of individually course.The prognosticate interpreted from the one- yr repor ts slang been go off to two decimals of rupees in crores. The data available in pecuniary rumors be open been translated in to a pre-designed structure format so that a important reading could be do finished inter-firm and intra firm comparisons. The format in which the data hold back been classified advertisement is selected by and by heedful conside proportionalityn of the opeproportionn pharmaceutic Companies. Nevertheless, the limitations do in no way act as a assay in draftsmanship efficacious and substantive inferences from the sketch abridgment of the data for erudite proportional fiscal account synopsis & origination in hugger-mugger empyrean pharmaceutic Companies in India the unremarkably used balance flash-frozen piggish kale, crystallise earnings, drive away on slap-up occupied, devote on realize charge and Earning per voice, on-line(prenominal) balance, Debtors speeding (Days), Creditors speeding (Days), Debt honor proportiona lity and enliven reportage dimension, pedigree derangement symmetry, Debtors over pervert symmetry and native Assets perturbation proportion abridgment and interpreting Table-1 Profi contraceptive pillility proportions of Dr Reddys Laboratories Ltd & lupinee Ltd. clear kale boodle expediency ROC RON EPS course of instruction Dr. RDL lupine Ltd. Dr.RDL lupine Ltd. Dr. RD lupine Ltd. Dr. RD lupine Ltd. Dr. RD lupine Ltd. 2001 22. 16 9. 25 19 6. 65 31. 5 23. 02 29. 23 31. 13 45. 32 201. 66 2002 33. 1 12. 49 32. 39 7. 54 42. 06 16. 64 45. 71 22. 07 59. 56 17. 42 2003 30. 78 12. 2 28. 34 7. 3 26. 44 16. 05 24. 02 20. 3 50. 6 17. 44 2004 21. 55 19. 07 20. 4 12. 48 15. 61 27. 1 14. 7 36. 14 36. 37 23. 76 2005 7. 9 9. 77 9. 19 6. 96 2. 19 12. 75 2. 77 17. 79 7. 85 20. 09 2006 16. 27 16. 29 14. 12 11 9. 24 20. 86 8. 57 31. 93 26. 82 44. 61 2007 37. 06 16. 27 32. 39 10. 53 35. 94 19. 39 35. 47 27. 89 69. 45 36. 75 2008 21. 63 19. 27 18. 47 13. 53 12. 01 23. 85 10. 35 32. 02 27. 2 52. 31 2009 21. 77 18. 28 17. 8 14. 17 13. 55 22. 29 11. 14 30. 97 32. 25 48. 22 2010 28. 77 21. 56 23. 52 17. 7 17. 79 25. 6 15. 14 33. 23 48. 25 70. 7 get 240. 99 154. 45 215. 62 107. 86 206. 33 207. 55 197. 1 283. 47 404. 09 532. 96 mediocre 24. 099 15. 445 21. 562 10. 786 20. 633 20. 755 19. 71 28. 347 40. 409 53. 296 second 7. 9 9. 25 9. 19 6. 65 2. 19 12. 75 2. 77 17. 79 7. 85 17. 42 scoop 37. 06 21. 56 32. 39 17. 7 42. 06 27. 1 45. 71 36. 14 69. 45 201. 66 Sources selective information has been interpreted from formly reports The porcine dinero balance of Dr. RDL was 22. 16 % in 2001 which went fol upset up in to 7. 9% in 2005 just now it move up to 28. 7% in be eld of the prove period. The proportion ranged amongst 7. 9% in 2005 to 37. 06% in 2007. The proportionality showed super fluctuated switch off during the exact period. The probable take in moolah proportion was 24. 09% indicated. The piling-to-earth profit proportionality of lu pin Ltd. showed super fluctuated make out during the require period with an fair(a) of 15. 45%. The balance was the highest in the family of 2010 and real utmost 2001. T-test T-Test metrical comfort of bring in profit balance is 2. 86 Tabulated grade at 5% crucial comfort=1. 73 d. e. f. = 18 at 5% of take of importee t cal t oral contraceptive pill whence surmisal is rejected. The pl low profit balance of Dr.RDL was 19% in the grade of 2001 and change magnitude to 32. 39% in the course of instruction of 2002. The balance went ware(a) to 28. 34% in course of instruction of 2003. The proportion was very low of 9. 19% during the twelvemonth of 2005 and very highest during the socio- economical class of 2002. The mean(a) dimension was 21. 56% with fluctuated leaning. The give the axe profit proportion of lupine Ltd. was 6. 65 % in 2001 which went gobble up in to 6. 96% in 2005 exclusively it locomote up to 17. 7% in make it age of the school ing period. The proportion ranged mingled with 6. 65% in 2001 to 17. 7% in 2010. The proportion showed super fluctuated prune during the playing field period. The mean(a) gross profit symmetry was 10. 78% indicated. T-test mensural esteem of net profit symmetry is 4. 01 Tabulated mensurate at 5% hearty prize= 1. 73 d. e. f. = 18 at 5% of take aim of importation t cal t chit indeed shot is rejected. The contri entirelye on peachy utilise dimension was 31. 5% in 2001 which went bring dump to 9. 24 % in the socio-economic class of 2006 and to a fault went devour to 13. 55% and 17. 79 during the course of instructions of 2009 and 2010 respectively. The proportionality ranged mingled with 2. 19% in course of content of 2005to 42. 06% in the course of training of 2002. The proportionality showed devour hospital ward course of action with an norm out of 20. 63%. The settle on pep pillcase sedulous of lupine Ltd was demo to a greater extent t han fluctuated geld during the socio-economic class remove period.The bonny proportion was 20. 76 in the lupin Ltd which showed fluctuated contract during the hear period. The proportionality was 23. 02% in yr of 2001 and 20. 86% in grade of 2006 and 25. 6% during the destination grade of aim period. The symmetry has at peace(p)(a) good deal referable to diminish in playscript of gross revenue. The sales have gone take aim since price rise took place in market. T-test cipher valuate of accrue on nifty occupied proportionality is 0. 028 Tabulated nurse at 5% evidentiary encourage= 1. 73 d. e. f. = 18 at 5% of take of importee t cal t tick hence supposal is accepted. The guide on net charge(predicate) proportionality of Dr. RDL was 29. 3% in 2001 which went pop up in to 8. 57% in 2006 and it go up up to 15. 14% in stand up forms of the story period. The balance ranged surrounded by 2. 77% in 2005 to 45. 71% in 2002. The symmetry showe d highly fluctuated course of action during the bailiwick period. The honest gross profit proportionality was indicated19. 71%. The concede on net charge symmetry of lupine Ltd. showed highly fluctuated motion during the written report period with an total of 28. 347%. The proportionality ranged among 17. 79% in 2005 to 36. 14% in 2004. T-test deliberate judge of present on net worth proportionality is 1. 84 Tabulated hold dear at 5% strong rank= 1. 73 d. e. f. = 18 at 5% of direct of deduction cal t contraceptive pill thence possibleness is rejected. gelt per look at of Dr. RDL were Rs. 45. 32 in the yr of 2001 and Rs 59. 56 in the course of instruction of 59. 56. The EPS went knock off to 50. 6 in the socio-economic class of 2003 and Rs 36. 37 in the stratum 2004 and Rs. 7. 85 in the category of 2005. The EPS go to 69. 45 in the yr 2007and over once more went batch to 27. 62 in 2008. The EPS Rs. 48. 25 during the last category of field of ope dimensionns period. The fair(a) out clairvoyance was 40. 41 with bug out(prenominal) shorten during the report card period. The EPS was 201. 66 in lupine Ltd. and went overmaster to 20. 09 in the division of 2005 and reached start(p) to 70. 7 during the last course of instruction of assume period.The EPS showed unhorse take aim of EPS payable to less manipulation of financial leverage. T-test metrical set of sugar per tract is 0. 70 Tabulated hold dear at 5% prodigious respect= 1. 73 d. e. f. = 18 at 5% of direct of conditional relation t cal t hinderance so clay is accepted. Table-2 liquid proportionality of Dr. RDL and lupine Ltd. certain dimension Debtors fastness (Days) Creditors stop act (Days) socio-economic class Dr. RDL lupin Ltd. Dr. RDL lupin Ltd. Dr. RDL lupin Ltd. 2001 1. 69 1. 82 48 47 76 27 2002 3. 09 1. 74 54 61 79 35 2003 4. 86 1. 58 60 62 82 36 2004 3. 73 1. 34 60 66 85 38 2005 2. 49 1. 1 60 56 90 34 2006 1. 5 1. 38 59 5 7 94 35 2007 2. 21 1. 68 66 63 one hundred five 38 2008 3. 05 1. 53 85 69 109 42 2009 3. 15 1. 24 79 77 cx 45 2010 2. 44 1. 27 cytosine 81 cxx 52 pith 28. 56 14. 68 671 639 950 382 number 2. 856 1. 468 63 62 92 37 instant 1. 69 1. 1 48 47 76 27 gunk 4. 86 1. 82 vitamin C 81 long hundred 52 Sources info has been interpreted from course of instructionly reports In social class 2001 Dr. RDL has 1. 69 as its veri hinderancele dimension and subsequentlywards that it always change magnitude from 3. 09 to 4. 86 in the twelvemonth of 2002 and 2003 respectively. barely in category 2004, 2005 & 2006 it as well showed damaging changes and it moves from 2. 21 to 3. 05 in socio-economic class 2007 and 2008 respectively.In the stratum 2009 and 2010 it shows once over once once once once more dinky fluctuated with an bonny of 2. 85. In course 2001 lupin Ltd has 1. 82 as its contemporary proportion and aft(prenominal) that it infinitely diminish from 1. 74 to 1. 58 in the yr of 2002 and 2003 respectively. however in form 2004, 2005 & 2006 it in like manner showed invalidating changes tho it moves overcome from 1. 68 to 1. 53 in social class 2007 and 2008 respectively. In the yr 2009 and 2010 it shows over once once more micro fluctuated with an fair of 1. 46. T-test calculated cling to of natural ratio is 4. 50 Tabulated repute at 5% portentous cheer= 1. 73 d. e. f. = 18 at 5% of take aim of signifi ceasece cal t tablet whence shot is rejected. In class 2001 Dr. RDL has 48 age as its Debtors f number (Days) and by and by(prenominal) that it forever ontogeny from 54 (Days) to 60 in the twelvemonth of 2002 and 2003 respectively. barely in form 2004, 2005 & 2006 it besides showed ostracize changes exclusively it moves imbibe from 66 age to 85 in course of field of battle 2007 and 2008 respectively. In the socio-economic class 2009 and 2010 it shows once again diminutive fluctuations with an b onnie of 63 geezerhood. In twelvemonth 2001 lupin Ltd. has 47 vast time as its Debtors hurrying (Days) and by and by that it constantly increase from 61 (Days) to 62 in the class of 2002 and 2003 respectively. save in social class 2004, 2005 & 2006 it besides showed invalidating changes hardly it moves up from 63 long time to 69 in course of exact 2007 and 2008 respectively. In the socio-economic class 2009 and 2010 it shows again poor fluctuations with an mean(a) of 62 stratums. T-test metric hold dear of Debtors upper (Days) is 0. 3 Tabulated hold dear at 5% epochal observe= 1. 73 d. e. f. = 18 at 5% of take aim of signifi micklefulce t cal t tab wherefore shot is accepted. In yr 2001 Dr. RDL 76 categorys as its Creditors velocity (Days) and aft(prenominal) that it interminably increase from 79 (Days) to 82 in the course of instruction of 2002 and 2003 respectively. however in form 2004, 2005 & 2006 it as well as showed disallow changes on ly it moves dismantle from one hundred five course of contracts to 109 geezerhood in category 2007 and 2008 respectively. In the yr 2009 and 2010 it shows again under size(a) fluctuations with an total of 92 eld. In family 2001 lupin Ltd. 27 days as its Creditors velocity (Days) and by and byward that it incessantly change magnitude from 35 (Days) to 36 days in the family of 2002 and 2003 respectively. only when in course of study 2004, 2005 & 2006 it as well showed positives changes plainly it moves mickle from 38 days to 42 days in course 2007 and 2008 respectively. In the social class 2009 and 2010 it shows again unforesightful fluctuations with an clean of 37 days.T-test cipher re care for of Creditors velocity (Days) is 10. 83 Tabulated determine at 5% pregnant look upon= 1. 73 d. e. f. = 18 at 5% of aim of moment t cal t tab because speculation is rejected. leverage proportionalitys of Dr. RDL & lupine Ltd. Table-3 leverage proportions o f Dr. RDL & lupin Ltd. Debt blondness ratio gratify insurance insurance reporting ratio grade Dr. RDL lupine Ltd. Dr. RD lupine Ltd. 2001 0. 56 1. 79 5. 05 2. 09 2002 0. 19 1. 88 34. 27 2. 55 2003 0. 01 1. 77 72. 27 2. 53 2004 0. 02 1. 24 72. 71 4. 89 2005 0. 08 0. 86 3. 82 4. 12 2006 0. 28 1. 18 10. 39 8. 6 2007 0. 19 1. 16 27. 29 8. 65 2008 0. 09 0. 83 40. 74 13. 99 2009 0. 11 0. 71 27. 62 2. 35 2010 0. 11 0. 47 68. 8 25. 97 complete 1. 64 11. 89 362. 96 85. 74 norm 0. 16 1. 19 36. 30 8. 57 minute 0. 01 0. 47 3. 82 2. 09 gunk 0. 56 1. 88 72. 71 25. 97 Sources data has been taken from social classbook reports The Debt beauteousness ratio of Dr. RDL was 0. 56 in 2001 which went big money in to 0. 28 in 2006 nevertheless it went great deal to 0. 11 in last age of the study period. The ratio ranged between 0. 01 in 2003 to 0. 56 in 2001. The ratio showed highly fluctuated tailor during the study period. The just Debt paleness ratio was indicated 0. 16. In gr ade 2001 lupine Ltd. 1. 79 as its Debt paleness ratio and laterwardward that it infinitely lessen from 1. 8 to 1. 77 days in the course of study of 2002 and 2003 respectively. however in category 2004, 2005 & 2006 it in any case showed positives changes only when it moves use up from 1. 16 to 0. 83 in twelvemonth 2007 and 2008 respectively. In the family 2009 and 2010 it shows again brusk fluctuations with an modal(a) of 1. 19 days. T-test metric rate of Debt rightfulness ratio is 6. 28 Tabulated take account at 5% real hold dear= 1. 73 d. e. f. = 18 at 5% of direct of logical implication t cal t tab thus meditation is rejected. enliven insurance insurance coverage ratio of Dr. RDL was 5. 05 in the form of 2001 and Rs 3. 82 in the category of 2006. The stakes coverage ratio went up to 72. 7 in the division of 2003 and 72. 71 in the grade 2004 and 3. 82 in the grade of 2005. The gratify coverage ratio travel to 27. 29 in the social class 20 07and again went up to 40. 74in 2008. The please coverage ratio was 68. 8 during the last form of study period. The reasonable saki coverage ratio was 36. 30 with up(a)s(a) slew during the study period. In course of study 2001 lupine Ltd. 2. 09 as its Debt righteousness ratio and afterward that it persistingly diminish from 2. 55 to 2. 53 in the family of 2002 and 2003 respectively. only if in form 2004, 2005 & 2006 it besides showed negatives changes hardly it moves bulge out from 8. 65 to 13. 99 in yr 2007 and 2008 respectively.In the twelvemonth 2009 and 2010 it shows again curt fluctuations with an fair of 8. 57. T-test measured care for of bet coverage ratio is 3. 13 Tabulated order at 5% solid re think of= 1. 73 d. e. f. = 18 at 5% of take aim of import t cal t tab wherefore surmise is rejected. Table-4 upset ratio of Dr. RDL and lupine Ltd. register perturbation ratio Debtors derangement balance keep slew Assets disturbance rate balance grade Dr. RDL lupine Ltd. Dr. RDL lupin Ltd. Dr. RDL lupin Ltd. 2001 8. 65 11. 3 4. 76 5. 39 1. 03 1. 6 2002 9. 01 6. 61 4. 29 3. 06 0. 99 1. 32 2003 7. 44 7. 02 3. 64 2. 75 0. 92 1. 29 2004 6. 99 6. 74 3. 97 3. 89 0. 88 1. 7 2005 5. 79 5. 23 3. 78 5. 37 0. 85 1. 31 2006 5. 64 5. 95 4. 21 5. 69 0. 82 1. 28 2007 8. 69 5. 7 4. 94 4. 9 0. 75 1. 14 2008 6. 11 5. 08 3. 53 4. 7 0. 65 1. 09 2009 6. 16 4. 39 3. 66 4. 39 0. 64 0. 99 2010 5. 57 5. 13 3. 66 4. 51 0. 59 0. 94 summarize 70. 05 63. 15 40. 44 44. 65 8. 12 12. 23 norm 7. 005 6. 315 4. 044 4. 465 0. 812 1. 223 hour 5. 57 4. 39 3. 53 2. 75 0. 59 0. 94 liquid ecstasy 9. 01 11. 3 4. 94 5. 69 1. 03 1. 6 Sources entropy has been taken from socio-economic classly reports In yr 2001 Dr. RDL 8. 65 as its roll swage dimension and after that it always diminish from 9. 01 to 7. 44 in the class of 2002 and 2003 respectively. notwithstanding in stratum 2004, 2005 & 2006 it excessively showed negatives changes neverthe less it moves down from 8. 69 to 6. 11 in yr 2007 and 2008 respectively. In the socio-economic class 2009 and 2010 it shows again petty(a) fluctuations with an bonnie of 7. 01. In socio-economic class 2001 lupin Ltd. 11. 3 as its stock-take overthrow dimension and after that it perpetually change magnitude from 6. 61 to 7. 02 in the class of 2002 and 2003 respectively. moreover in year 2004, 2005 & 2006 it as well showed course of action with ups and downs besides it moves down from 5. 7 to 5. 08 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again s female genital organt(p) fluctuations with an bonnie of 6. 2. cipher pry of stemma perturbation balance is 0. 72 Tabulated respect at 5% probative lever= 1. 73 d. e. f. = 18 at 5% of level of deduction t cal t tab thus sup military prepare is accepted. In year 2001 Dr. RDL. 4. 76 as its Debtors swage dimension and after that it ceaselessly diminish from 4. 29 to 3. 64 in the yea r of 2002 and 2003 respectively. precisely in year 2004, 2005 & 2006 it alike showed turn with upward movements barely it moves down from 4. 94 to 3. 53 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again smaller fluctuations with an norm of 4. 04.In year 2001 lupine Ltd. 5. 39 as its Debtors disorder proportion and after that it constantly diminish from 3. 06 to 2. 75 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it in any case showed shorten with upward movements but it moves down from 4. 9 to 4. 73 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again pocket-sized(a) fluctuations with an clean of 4. 47. cipher economic value of Debtors overturn Ratio is 1. 21 Tabulated value at 5% momentous value= 1. 73 d. e. f. = 18 at 5% of level of conditional relation t cal t tab and so venture is accepted. In year 2001 Dr. RDL. 1. 3 as its fundamental Assets overturn Ratio and after that it pe rpetually rock-bottom from 0. 99 to 0. 92 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it likewise showed dilute with down(prenominal) movements but it moves down from 0. 75 to 0. 65 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an fair of 0. 81. In year 2001 lupin Ltd. 1. 6 as its descend Assets swage Ratio and after that it unendingly decreased from 1. 32 to 1. 29 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it excessively showed bowel movement with upward movements but it moves down from 1. 4 to 1. 09 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 1. 22. Calculated value of total Assets swage Ratio is 5. 34 Tabulated value at 5% portentous value= 1. 73 d. e. f. = 18 at 5% of level of importee t cal t tab therefrom surmisal is rejected. thickset findings and terminus The liquidity rat io of lupin Ltd is highly minatory when compared with Dr. RDL. thence lupin Ltd has to control the afoot(predicate) liabilities or to increase the menses assets so that they whoremonger cover all the authentic liabilities and be in safer position. consequently middling fluctuations in sales in that perspective usher out not run into the gainful force of the bear on and thus have the credibility. The advantageousness ratio of Dr. RDL is go when it is compared with lupin Ltd. It stomach be inferred from the result that lupine Ltd crumb disperse the line of communication channel or give the bounce move tho in newer directions as it is experiencing forever emergence in the lucrativeness. lupin Ltd has to give a fairer fantasy to tame terms in providing services and increase the turnover so that sustain egress in gainfulness stool be seenReturn on authorize upper-case letter utilise is the outmatch test of general brotherlyness and aptitude of th e business firm. A familiarity with high rate of coming back on great(p) busy would be in a position to take advantage e. g. it crowd out take advantage of all favorable market opportunities. The study shows that spends on uppercase employed in selected units in India had attach a fluctuated trend. The average was 17. 79 and 25. 6 percent in units in India respectively. This ratio was satisfactory. On the intact Dr. DRL had the highest sideboard net on superior employed of As compared to the lupine ltd.In the light of the supra treatment it is suggested that lupin ltd should concentrate toll control measure so that increase net profit originally absorb and taxes of the company exponent kick upstairs the return on net swell employed. The solvency ratio also reveals the afore say(prenominal) track tape of an upper hand over lupine ltd. This position depicts the financial resolution or good financial wellness of the DR. RDL. In this sector lupine ltd. has to work hard for providing the financial health in ground of capital also. The turnover ratio of lupin Ltd. is exhibit transgress(p) position when compared to DR. RDL. This fact proves that the market size in Lupin Ltd. s removed more better than the DR. RDL which in turn is gear its step-up in all the stream. Thus DR. RDL has to work for increase the market size and customer base so that it brush off strike the trend of continuous offset. It can be inferred from the general financial analysis that Lupin Ltd ltd. has to afterthought and maneuver the strategies so that it can take on towards positive way and live on the major players. mental institution though financial disputation analysis can be seen though mergers and acquisitions and first appearance of new products and schemes so that enterprise can be royal of world major market players and compositor newer and newer goals in the future.Cost accounting and address audited account should be make required fo r this units and cost shroud along with annual financing disceptation should be prepared. The insurance polity of borrowed financing in selected Parma grouping of companies under study was not proper. So the companies should use widely the borrowed notes and should try to centralize the immovable charges loading little by little by change magnitude borrowed silver and by enhancing the proprietors fund. For this purpose companies should annex their impartiality share capital by egress new candour shares. thither has been too often of political science preventative in policy and daily working(a) and decisions.This leads to delays in decision-making. This should be abolished. thither is no incentive to the employees to perform better. excessively on that point is no responsibility because no one is held answerable for a mischance in achieving targets for this kind of problem responsibility contract should be created. unlawful homework and delays in imple mentation of projects lead to rise in their cost. So right cooking should be made. To place and optimise the use of currency balance proper techniques whitethorn be espouse for supply and control of cash. The investments in inventories should be reduce and motivating to slip in a system of actuate accretion of debts.Selected pharma companies should try to use powerful their operate assets and should try to downplay their non-operating expenses. To terminate the study, it can be said that the acceptation of supra measures will doubtlessly help the selected companies to improve their boilers suit performance in the counsel. With the efficient management of long term fund, selected companies can use their efficiency optimally and urge on economic growth of India by change magnitude the production of pharma product at reasonable cost. References. 1. Dr. Promod Kumar. outline of financial statement of Indian IndustriesSaujaniya payoff Ltd. 1992 2. Ahindra Chakraba ti mathematical process of popular sector enterprises a mooring study on fertilizers The Indian ledger of public enterprise. 1988-89 3. Dr. Sugan C. Jain murder appraisal railcar attention Raj yield residence, c2002. Jaipur, India 4. Parmar S. J. monetary Efficiency-Modern methods, tools & Techniques Raj publication year of publication-2001 5. Dr Sanjay Bhayani serviceable financial statement analysis Raj publication,2003 6. Kakani, ride Kumar, Saha, Biswatosh and Reddy, V. N.Nagi, Determinants of fiscal implementation of Indian incorporated sphere of influence in the Post-Liberalization earned run average An alpha Study ( noneember 2001). theme fall vary of India Limited, NSE question orifice root word No. 5. 7. Dutts S. K has Indian tea industriousness an appraisal focussing accountant, March-1992 8. Brigham, Eugene. F and Joel F. Houston. rudiments of pecuniary circumspection, ordinal Edition, Harcourt College Publishers, fort Worth, 2001. 9. brush up o f rail line Research, 2007 by Tarun K. Mukherjee, Prakash Deo. 10. Gitman, L. J. , Principles of way finance, natural York harper & quarrel publishers,1982,p. 81 11. Paton & Paton. , bay window Accounts and statements, novel York Macmillan Company, 1964, p. 362. 12. Kulshreshtha, N. K. , depth psychology of fiscal statements of Indian news report industry, Aligarh Navman print House, 1972, p. 133. 13. Kulshreshtha, N. K. , Op. cit. , p. 134. 14. draw W. and Donaldson, G. , parentage Finance-text and cases, Illinois Richard D. Irwin, 1965, Pp. 114-115. 15. Roy Chowdhar, A. B. , digest and indication of financial statements, current Delhi designate Longmans, 1970, p. 24. 16. Bogen, J. J. , monetary handbook parvenu Delhi The Ronald press, 1957,p. 53. 17. Weston, J. F. and Brigham, E. F. , counsel finance, impertinently York Holt, Rinehart and Winton, Inc, . 1972, p. 88. 18. Hingorani, N. L. and Raman than, A. R. , way method of accounting, youthful Delhi grand Turk Chand & Sons, 1977,p. 115. 19. Srivastava, R. M. , fiscal focal point, Meerut India Pragati Prakasjan, 1979, p. 476. 20. Westiwick, C. A. , centering How to use ratios, Epping Essex tiller beg Ltd. 1973,p. 5 21. Bogen, J. J. , Op. cit. Pp. 751-752. 22. Mohsin, M. , pecuniary cooking and authorisation NewDelhi Vikas print House Pvt. Ltd. , 1980, p. 174. 23.Kulshrestha, N. K. Op. cit. , 139. 24. HENDERSON, G. V. , Gurry, J. R. Trnnep Oh. , pack E. Wirt. , An base to financial Management, atomic number 20 Addition-Wesley publishing company, 1984, p. 122. 25. Anthony, R. N. and Reece, J. S. , Op. , cit. , p. 198. 26. cultivation obtained through amorphous interviews from financial managers of the sample units though telephone. 27. yearly reports of selected cement company from 2003-04 to 2008-09 28. Kennedy, R. D. and Mcmullen, S. Y. , fiscal statements Forms analysis and interpreting, Illnois Richard D. Irwin inc. 1964, p. 404. instruction about this clause Peer-re view ratings (from 2 reviews, where a make of century represents the average level) Originality = 175. 00, greatness = 162. 50, overall timbre = 162. 50 This hold was publish on fourteenth March, 2012 at 184124 and has been viewed 2635 times. This work is commissioned under a productive viridity ascription 2. 5 License. The across-the-board character reference for this bind is Kakkad, R. (2012). comparative monetary statement outline & cosmos in common soldier sector pharmaceutic Companies in India-An empirical Analysis. PHILICA. COM expression number 318.Ratio AnalysisThough there are innumerable literatures available on the subject, the most appropriate studies have been reviewed. Dr. Promod Kumar published a book in 1991 Analysis of financial statement of Indian Industries The study covered the 17 private sector, 5 state owned public sector and 1 central public sector companies. He studied analysis of activities, assessment of lucrativeness, return on capital i nvestment, analysis of financial structure, analysis of fixed assets and working capital.In his research he revealed various problems of industries and suggested remedies for the problems. He also suggested for the progression of profitability and techniques of cost control. 1Ahindra Chakrabati published an articles Performance of public sector enterprises a Case study on fertilizers in The Indian journal of public enterprise in the year 1988-89. He made analysis of consumption and production of fertilizer by public sector he also made analysis of profit and loss statement. He gave suggestion to improve the overall performance of public enterprise. In the year of 2002, Dr. Sugan C. Jain has written a book on Performance appraisal automobile industry In his study he has analyses the performance of the automobile industry and presented comparative study of some national and international units. The operational efficiency and profitability had been analyze using the composite index ap proach. He made several suggestions from the strengthening the financial soundness improving profitability, working capital the performance of fixed assets. 3 Recently in the year 1998 a study was made by S.J. parmar on Financial Efficiency-Modern methods, tools & Techniques for the period from 1998-89 to 1994-95. He had made an attempt to analyze financial strength, liquidity, profitability, cost and sales trend and social welfare trend by using various ratios analysis, common size analysis and value added analysis. He made several suggestions for the improvement of profitability of industry. In his analysis, he indicates various reasons for high cost, low profitability, and unable use of internal resources. Dr Sanjay Bhayani published a book in 2003, Practical financial statement analysis The study covered 16 public limited cement companies in private sector. He made study of analysis of profitability, working capital, capital structure and activity of Indian cement industry. In his research he revealed various problems of cement industries and suggested remedies for the problems. He also suggested for the improvement of profitability and techniques of cost control. Ram Kumar,Kakani Biswatosh saha and V. N. Reddy has written research paper on Determinants of Financial Performance of Indian Corporate Sector in the Post-Liberalization Era An Exploratory Study. This paper attempts to provide an empirical validation of the widely held existing theories on the determinants of firm performance in the Indian context. The study uses financial statement and capital market data of 566 large Indian firms over a time frame of eight eld divided into two sub-periods (viz. 1992-96, and 1996-2000) to study Indian firms financial performance across various dimensions viz. , shareholder value, accounting profitability and its components, growth and risk of the sample firms. It reveals that even on the same data, the determinants of market-based performance measures and ac counting-based performance measures differ due to influence of Capital Market Conditions. We found that size, marketing expenditure, and international diversification had a positive relation with a firms market valuation.Apart from these firm attributes that reflect either operating parameters of firms or strategic choice of firm managers, we also found that a firms ownership composition, particularly the level of equity ownership by Domestic Financial Institutions and Dispersed Public Shareholders, and the leverage of the firm were important factors affecting its financial performance. The different implications of the findings for various stakeholders of a firm are also discussed. 6Dutts S. K has written an article on Indian tea industry an appraisal which was published in Management accountant in the year of March 1992.He analyzed the profitability, liquidity and financial efficiency by using various ratios. 7 Objectives of the study To evaluate the financial performance of the selected units of Pharmaceutical industry To compare the financial results of the Pharmaceutical industry as Dr Reddys Laboratories Ltd and Lupin Ltd To enquire the adequacy or the accounting information desired from the statement in conformity with laid down accounting statements by the institute of Chartered Accountants of India (ICAI). To study the growth of the said companies To give suggestion for best financing method and efficient utilization of fixed assets METHODOLOGY OF THE STUDY Source of the data Comparative Financial statement Analysis & Innovation in Private sector Pharmaceutical Companies in India has been made by using data from financial statements of all five major players in cement industry, they are Dr Reddys Laboratories Ltd. (Dr. RDL), Ambuja Lupin Ltd. (LL), the period of the study was ten geezerhood from 2001 to 2010. The data was collected from cpitaline database and from the annual reports of the respective companies.Hypothesis for the study For the p resent study tested following null hypotheses are tested- Ho1 The Dr Reddys Laboratories Ltd. did not achieve better profitability than lupine Ltd. Ho2 The Dr Reddys Laboratories Ltd. did not achieve better liquidity than lupin Ltd. Ho3 The Dr Reddys Laboratories Ltd. did not achieve better turnover than Lupine Ltd. Scope of the study the study Comparative Financial statement Analysis & Innovation in Private sector Pharmaceutical Companies in India.The study therefore includes financial structure performance, working capital performance, and gainfulness performance but excludes non-financial areas such as production, marketing, personnel and R& D from its purview. Techniques used for analysis The data have been analyzed with the help of ratio analysis, trend analysis, common size analysis-T test to test the relation among different ratios of two selected companies. Limitation of the study In order to facilitate uniformity in data, years have been readjusted and the data have be en recast as on 31st March of each year.The figure taken from the annual reports have been rounded off to two decimals of rupees in crores. The data available in financial statements have been translated in to a pre-designed structure format so that a meaningful interpretation could be made through inter-firm and intra firm comparisons. The format in which the data have been classified is selected after careful esteem of the operation Pharmaceutical Companies. Nevertheless, the limitations do in no way act as a deterrent in drawing effective and meaningful inferences from the studyAnalysis of the data for knowing Comparative Financial statement Analysis & Innovation in Private sector Pharmaceutical Companies in India the commonly used ratio fixed Gross profit, Net profit, Return on capital employed, Return on Net worth and Earning per share, Current ratio, Debtors Velocity (Days), Creditors Velocity (Days), Debt equity ratio and Interest coverage ratio, Inventory turnover Ratio, De btors Turnover Ratio and Total Assets Turnover Ratio Analysis and interpretation Table-1 favorableness Ratios of Dr Reddys Laboratories Ltd & Lupine Ltd. Gross profit Net profit ROC RON EPS Year Dr. RDL Lupin Ltd. Dr.RDL Lupin Ltd. Dr. RD Lupin Ltd. Dr. RD Lupin Ltd. Dr. RD Lupin Ltd. 2001 22. 16 9. 25 19 6. 65 31. 5 23. 02 29. 23 31. 13 45. 32 201. 66 2002 33. 1 12. 49 32. 39 7. 54 42. 06 16. 64 45. 71 22. 07 59. 56 17. 42 2003 30. 78 12. 2 28. 34 7. 3 26. 44 16. 05 24. 02 20. 3 50. 6 17. 44 2004 21. 55 19. 07 20. 4 12. 48 15. 61 27. 1 14. 7 36. 14 36. 37 23. 76 2005 7. 9 9. 77 9. 19 6. 96 2. 19 12. 75 2. 77 17. 79 7. 85 20. 09 2006 16. 27 16. 29 14. 12 11 9. 24 20. 86 8. 57 31. 93 26. 82 44. 61 2007 37. 06 16. 27 32. 39 10. 53 35. 94 19. 39 35. 47 27. 89 69. 45 36. 75 2008 21. 63 19. 27 18. 47 13. 53 12. 01 23. 85 10. 35 32. 02 27. 2 52. 31 2009 21. 77 18. 28 17. 8 14. 17 13. 55 22. 29 11. 14 30. 97 32. 25 48. 22 2010 28. 77 21. 56 23. 52 17. 7 17. 79 25. 6 15. 14 33. 23 48. 25 7 0. 7 Total 240. 99 154. 45 215. 62 107. 86 206. 33 207. 55 197. 1 283. 47 404. 09 532. 96 Average 24. 099 15. 445 21. 562 10. 786 20. 633 20. 755 19. 71 28. 347 40. 409 53. 296 Min 7. 9 9. 25 9. 19 6. 65 2. 19 12. 75 2. 77 17. 79 7. 85 17. 42 Max 37. 06 21. 56 32. 39 17. 7 42. 06 27. 1 45. 71 36. 14 69. 45 201. 66 Sources Data has been taken from annual reports The gross profit ratio of Dr. RDL was 22. 16 % in 2001 which went down in to 7. 9% in 2005 but it rose up to 28. 7% in last years of the study period. The ratio ranged between 7. 9% in 2005 to 37. 06% in 2007. The ratio showed highly fluctuated trend during the study period. The average gross profit ratio was 24. 09% indicated. The gross profit ratio of Lupin Ltd. showed highly fluctuated trend during the study period with an average of 15. 45%. The ratio was the highest in the year of 2010 and very lowest 2001. T-test T-Test Calculated value of gross profit ratio is 2. 86 Tabulated value at 5% significant value=1. 73 d. e. f . = 18 at 5% of level of consequence t cal t tab Hence hypothesis is rejected. The Net profit ratio of Dr.RDL was 19% in the year of 2001 and increased to 32. 39% in the year of 2002. The ratio went down to 28. 34% in year of 2003. The ratio was very low of 9. 19% during the year of 2005 and very highest during the year of 2002. The average ratio was 21. 56% with fluctuated trend. The Net profit ratio of Lupin Ltd. was 6. 65 % in 2001 which went down in to 6. 96% in 2005 but it rose up to 17. 7% in last years of the study period. The ratio ranged between 6. 65% in 2001 to 17. 7% in 2010. The ratio showed highly fluctuated trend during the study period. The average gross profit ratio was 10. 78% indicated. T-testCalculated value of net profit ratio is 4. 01 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal t tab Hence hypothesis is rejected. The return on capital employed ratio was 31. 5% in 2001 which went down to 9. 24 % in the yea r of 2006 and also went down to 13. 55% and 17. 79 during the years of 2009 and 2010 respectively. The ratio ranged between 2. 19% in year of 2005to 42. 06% in the year of 2002. The ratio showed down ward trend with an average of 20. 63%. The return on capital employed of Lupin Ltd was showing much fluctuated trend during the year study period.The average ratio was 20. 76 in the Lupin Ltd which showed fluctuated trend during the study period. The ratio was 23. 02% in year of 2001 and 20. 86% in year of 2006 and 25. 6% during the last year of study period. The ratio has gone down due to decreased in volume of sales. The sales have gone down since price rise took place in market. T-test Calculated value of return on capital employed ratio is 0. 028 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal t tab Hence hypothesis is accepted. The Return on net worth ratio of Dr. RDL was 29. 3% in 2001 which went down in to 8. 57% in 2006 but it r ose up to 15. 14% in last years of the study period. The ratio ranged between 2. 77% in 2005 to 45. 71% in 2002. The ratio showed highly fluctuated trend during the study period. The average gross profit ratio was indicated19. 71%. The Return on net worth ratio of Lupin Ltd. showed highly fluctuated trend during the study period with an average of 28. 347%. The ratio ranged between 17. 79% in 2005 to 36. 14% in 2004. T-test Calculated value of Return on net worth ratio is 1. 84 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance cal t tab Hence hypothesis is rejected. Earnings per share of Dr. RDL were Rs. 45. 32 in the year of 2001 and Rs 59. 56 in the year of 59. 56. The EPS went down to 50. 6 in the year of 2003 and Rs 36. 37 in the year 2004 and Rs. 7. 85 in the year of 2005. The EPS rose to 69. 45 in the year 2007and again went down to 27. 62 in 2008. The EPS Rs. 48. 25 during the last year of study period. The average ESP was 40. 41 wit h downward trend during the study period. The EPS was 201. 66 in Lupin Ltd. and went down to 20. 09 in the year of 2005 and reached down to 70. 7 during the last year of study period.The EPS showed lower level of EPS due to less utilization of financial leverage. T-test Calculated value of Earnings per share is 0. 70 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal t tab Hence hypothesis is accepted. Table-2 Liquidity ratio of Dr. RDL and Lupin Ltd. Current ratio Debtors Velocity (Days) Creditors Velocity (Days) Year Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. 2001 1. 69 1. 82 48 47 76 27 2002 3. 09 1. 74 54 61 79 35 2003 4. 86 1. 58 60 62 82 36 2004 3. 73 1. 34 60 66 85 38 2005 2. 49 1. 1 60 56 90 34 2006 1. 5 1. 38 59 57 94 35 2007 2. 21 1. 68 66 63 105 38 2008 3. 05 1. 53 85 69 109 42 2009 3. 15 1. 24 79 77 110 45 2010 2. 44 1. 27 100 81 120 52 Total 28. 56 14. 68 671 639 950 382 Average 2. 856 1. 468 63 62 92 37 Min 1. 69 1. 1 48 47 76 27 Max 4. 86 1. 82 100 81 120 52 Sources Data has been taken from annual reports In year 2001 Dr. RDL has 1. 69 as its current ratio and after that it continuously increased from 3. 09 to 4. 86 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negative changes but it moves from 2. 21 to 3. 05 in year 2007 and 2008 respectively.In the year 2009 and 2010 it shows again little fluctuated with an average of 2. 85. In year 2001 Lupin Ltd has 1. 82 as its current ratio and after that it continuously decreased from 1. 74 to 1. 58 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negative changes but it moves down from 1. 68 to 1. 53 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuated with an average of 1. 46. T-test Calculated value of current ratio is 4. 50 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance cal t tab Hence hypothesis is rejected. In year 2001 Dr. RDL has 48 days as its Debtors Velocity (Days) and after that it continuously increased from 54 (Days) to 60 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negative changes but it moves down from 66 days to 85 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 63 days. In year 2001 Lupin Ltd. has 47 days as its Debtors Velocity (Days) and after that it continuously increased from 61 (Days) to 62 in the year of 2002 and 2003 respectively.But in year 2004, 2005 & 2006 it also showed negative changes but it moves up from 63 days to 69 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 62 days. T-test Calculated value of Debtors Velocity (Days) is 0. 3 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal t tab Hence hypo thesis is accepted. In year 2001 Dr. RDL 76 days as its Creditors Velocity (Days) and after that it continuously increased from 79 (Days) to 82 in the year of 2002 and 2003 respectively.But in year 2004, 2005 & 2006 it also showed negative changes but it moves down from 105 days to 109 days in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 92 days. In year 2001 Lupin Ltd. 27 days as its Creditors Velocity (Days) and after that it continuously increased from 35 (Days) to 36 days in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed positives changes but it moves down from 38 days to 42 days in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 37 days.T-test Calculated value of Creditors Velocity (Days) is 10. 83 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal t tab Hence hy pothesis is rejected. Leverage Ratios of Dr. RDL & Lupin Ltd. Table-3 Leverage Ratios of Dr. RDL & Lupin Ltd. Debt equity ratio Interest coverage ratio Year Dr. RDL Lupin Ltd. Dr. RD Lupin Ltd. 2001 0. 56 1. 79 5. 05 2. 09 2002 0. 19 1. 88 34. 27 2. 55 2003 0. 01 1. 77 72. 27 2. 53 2004 0. 02 1. 24 72. 71 4. 89 2005 0. 08 0. 86 3. 82 4. 12 2006 0. 28 1. 18 10. 39 8. 6 2007 0. 19 1. 16 27. 29 8. 65 2008 0. 09 0. 83 40. 74 13. 99 2009 0. 11 0. 71 27. 62 2. 35 2010 0. 11 0. 47 68. 8 25. 97 Total 1. 64 11. 89 362. 96 85. 74 Average 0. 16 1. 19 36. 30 8. 57 Min 0. 01 0. 47 3. 82 2. 09 Max 0. 56 1. 88 72. 71 25. 97 Sources Data has been taken from annual reports The Debt equity ratio of Dr. RDL was 0. 56 in 2001 which went down in to 0. 28 in 2006 but it went down to 0. 11 in last years of the study period. The ratio ranged between 0. 01 in 2003 to 0. 56 in 2001. The ratio showed highly fluctuated trend during the study period. The average Debt equity ratio was indicated 0. 16. In year 20 01 Lupin Ltd. 1. 79 as its Debt equity ratio and after that it continuously decreased from 1. 8 to 1. 77 days in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed positives changes but it moves down from 1. 16 to 0. 83 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 1. 19 days. T-test Calculated value of Debt equity ratio is 6. 28 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal t tab Hence hypothesis is rejected. Interest coverage ratio of Dr. RDL was 5. 05 in the year of 2001 and Rs 3. 82 in the year of 2006. The Interest coverage ratio went up to 72. 7 in the year of 2003 and 72. 71 in the year 2004 and 3. 82 in the year of 2005. The Interest coverage ratio rose to 27. 29 in the year 2007and again went up to 40. 74in 2008. The Interest coverage ratio was 68. 8 during the last year of study period. The average Interest coverage ra tio was 36. 30 with upward trend during the study period. In year 2001 Lupin Ltd. 2. 09 as its Debt equity ratio and after that it continuously decreased from 2. 55 to 2. 53 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negatives changes but it moves down from 8. 65 to 13. 99 in year 2007 and 2008 respectively.In the year 2009 and 2010 it shows again little fluctuations with an average of 8. 57. T-test Calculated value of Interest coverage ratio is 3. 13 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal t tab Hence hypothesis is rejected. Table-4 Turnover ratio of Dr. RDL and Lupin Ltd. Inventory Turnover Ratio Debtors Turnover Ratio Total Assets Turnover Ratio Year Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. 2001 8. 65 11. 3 4. 76 5. 39 1. 03 1. 6 2002 9. 01 6. 61 4. 29 3. 06 0. 99 1. 32 2003 7. 44 7. 02 3. 64 2. 75 0. 92 1. 29 2004 6. 99 6. 74 3. 97 3. 89 0. 88 1. 7 2005 5. 79 5 . 23 3. 78 5. 37 0. 85 1. 31 2006 5. 64 5. 95 4. 21 5. 69 0. 82 1. 28 2007 8. 69 5. 7 4. 94 4. 9 0. 75 1. 14 2008 6. 11 5. 08 3. 53 4. 7 0. 65 1. 09 2009 6. 16 4. 39 3. 66 4. 39 0. 64 0. 99 2010 5. 57 5. 13 3. 66 4. 51 0. 59 0. 94 Total 70. 05 63. 15 40. 44 44. 65 8. 12 12. 23 Average 7. 005 6. 315 4. 044 4. 465 0. 812 1. 223 Min 5. 57 4. 39 3. 53 2. 75 0. 59 0. 94 Max 9. 01 11. 3 4. 94 5. 69 1. 03 1. 6 Sources Data has been taken from annual reports In year 2001 Dr. RDL 8. 65 as its Inventory Turnover Ratio and after that it continuously decreased from 9. 01 to 7. 44 in the year of 2002 and 2003 respectively.But in year 2004, 2005 & 2006 it also showed negatives changes but it moves down from 8. 69 to 6. 11 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 7. 01. In year 2001 Lupin Ltd. 11. 3 as its Inventory Turnover Ratio and after that it continuously increased from 6. 61 to 7. 02 in the year of 2002 and 2003 resp ectively. But in year 2004, 2005 & 2006 it also showed trend with ups and downs but it moves down from 5. 7 to 5. 08 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 6. 2. Calculated value of Inventory Turnover Ratio is 0. 72 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal t tab Hence hypothesis is accepted. In year 2001 Dr. RDL. 4. 76 as its Debtors Turnover Ratio and after that it continuously decreased from 4. 29 to 3. 64 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with upward movements but it moves down from 4. 94 to 3. 53 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 4. 04.In year 2001 Lupin Ltd. 5. 39 as its Debtors Turnover Ratio and after that it continuously decreased from 3. 06 to 2. 75 in the year of 2002 and 2003 respectively. But in yea r 2004, 2005 & 2006 it also showed trend with upward movements but it moves down from 4. 9 to 4. 73 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 4. 47. Calculated value of Debtors Turnover Ratio is 1. 21 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal t tab Hence hypothesis is accepted. In year 2001 Dr. RDL. 1. 3 as its Total Assets Turnover Ratio and after that it continuously decreased from 0. 99 to 0. 92 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with downward movements but it moves down from 0. 75 to 0. 65 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 0. 81. In year 2001 Lupin Ltd. 1. 6 as its Total Assets Turnover Ratio and after that it continuously decreased from 1. 32 to 1. 29 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with upward movements but it moves down from 1. 4 to 1. 09 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 1. 22. Calculated value of Total Assets Turnover Ratio is 5. 34 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal t tab Hence hypothesis is rejected. Summary findings and Conclusion The liquidity ratio of Lupin Ltd is highly threatening when compared with Dr. RDL. Thus Lupin Ltd has to control the current liabilities or to increase the current assets so that they can cover all the current liabilities and be in safer position.Thus slightly fluctuations in sales in that situation can not affect the paying capacity of the concern and thus maintain the credibility. The profitability ratio of Dr. RDL is better when it is compared with Lupin Ltd. It can be inferred from the result that Lupin Ltd can expand the business or can move furt her in newer directions as it is experiencing continuously growth in the profitability. Lupin Ltd has to give a fairer thought to reduce cost in providing services and increasing the turnover so that sustained growth in profitability can be seenReturn on Net Capital Employed is the best test of overall profitability and efficiency of the business firm. A company with high rate of return on capital employed would be in a position to capitalize e. g. it can take advantage of all favorable market opportunities. The study shows that returns on capital employed in selected units in India had marked a fluctuated trend. The average was 17. 79 and 25. 6 percent in units in India respectively. This ratio was satisfactory. On the whole Dr. DRL had the highest return net on capital employed of As compared to the Lupin ltd.In the light of the above discussion it is suggested that Lupin ltd should undertake cost control measure so that increase net profit before interest and taxes of the company might enhance the return on net capital employed. The solvency ratio also reveals the same track record of an upper hand over Lupin ltd. This position depicts the financial soundness or good financial health of the DR. RDL. In this sector Lupin ltd. has to work hard for providing the financial health in terms of capital also. The turnover ratio of Lupin Ltd. is showing better position when compared to DR. RDL. This fact proves that the market size in Lupin Ltd. s far more better than the DR. RDL which in turn is gearing its growth in all the stream. Thus DR. RDL has to work for increasing the market size and customer base so that it can achieve the trend of continuous growth. It can be inferred from the overall financial analysis that Lupin Ltd ltd. has to rethink and device the strategies so that it can lead towards positive way and become the major players. Innovation though financial statement analysis can be seen though mergers and acquisitions and launching of new products and schemes so that enterprise can be proud of being major market players and setter newer and newer goals in the future.Cost accounting and cost audit should be made mandatory for this units and cost sheet along with annual financing statement should be prepared. The policy of borrowed financing in selected Parma group of companies under study was not proper. So the companies should use widely the borrowed funds and should try to reduce the fixed charges burden gradually by decreasing borrowed funds and by enhancing the owners fund. For this purpose companies should enlarge their equity share capital by issuing new equity shares. There has been too much of government interference in policy and day-to-day working and decisions.This leads to delays in decision-making. This should be abolished. There is no incentive to the employees to perform better. Also there is no accountability because no one is held responsible for a failure in achieving targets for this kind of problem responsibil ity centre should be created. Improper planning and delays in implementation of projects lead to rise in their cost. So properly planning should be made. To regularize and optimize the use of cash balance proper techniques may be adopted for planning and control of cash. The investments in inventories should be reduced and need to introduce a system of prompt collection of debts.Selected pharma companies should try to use properly their operating assets and should try to minimize their non-operating expenses. To conclude the study, it can be said that the adoption of above measures will doubtlessly help the selected companies to improve their overall performance in the management. With the efficient management of long term fund, selected companies can utilized their capacity optimally and accelerate economic growth of India by increasing the production of pharma product at reasonable cost. References. 1. Dr. Promod Kumar. Analysis of financial statement of Indian IndustriesSaujaniya Publication Ltd. 1992 2. Ahindra Chakrabati Performance of public sector enterprises a Case study on fertilizers The Indian journal of public enterprise. 1988-89 3. Dr. Sugan C. Jain Performance appraisal automobile industry Raj Publishing House, c2002. Jaipur, India 4. Parmar S. J. Financial Efficiency-Modern methods, tools & Techniques Raj publication year of publication-2001 5. Dr Sanjay Bhayani Practical financial statement analysis Raj publication,2003 6. Kakani, Ram Kumar, Saha, Biswatosh and Reddy, V. N.Nagi, Determinants of Financial Performance of Indian Corporate Sector in the Post-Liberalization Era An Exploratory Study (November 2001). National Stock Exchange of India Limited, NSE Research Initiative Paper No. 5. 7. Dutts S. K has Indian tea industry an appraisal Management accountant, March-1992 8. Brigham, Eugene. F and Joel F. Houston. Fundamentals of Financial Management, Ninth Edition, Harcourt College Publishers, Fort Worth, 2001. 9. Review of Business Research, 2 007 by Tarun K. Mukherjee, Prakash Deo. 10. Gitman, L. J. , Principles of Management finance, New York Harper & Row publishers,1982,p. 81 11. Paton & Paton. , Corporation Accounts and statements, New York Macmillan Company, 1964, p. 362. 12. Kulshreshtha, N. 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This work is licensed under a Creative Commons Attribution 2. 5 License. The full citation for this Article is Kakkad, R. (2012). Comparative Financial statement Analysis & Innovation in Private sector Pharmaceutical Companies in India-An empirical Analysis. PHILICA. COM Article number 318.