Medical Equipment Company: NAVANA
Organization
Navana Biponon Limited is a leading edge Health Medical Equipment Company based in Dhaka and Chittagong, Bangladesh and is acclaimed for its sales and after sales service.
Company Introduction
Navana Biponon Limited came into being in 1996 as a specialized company in the field on Medical & Health Sector. This company comprises a team of experienced & trained Bio-Medical & Electro-Medical Engineers and also a group of skilled marketing professionals. Within a short span of time Biponon has already positioned itself as market leader in medical and scientific equipment. Also it has proved its reliability by providing its customer prompt and satisfactory after sales service. The area and departments where this company is doing business are Medical & Health Sector and has been successfully doing business in Ministry of Health, CMSD, DGMS, DGDP, Atomic Energy Commission, Probin Hospital, ICMH, Diabetic Association of Bangladesh, etc.
Navana Biponon Limited has commenced its proceedings with a great motto to contribute in the countries Health Sector to improve its quality of various Diagnostics, Medical & Laboratory Equipment by supplying them various advanced and sophisticated scientific and medical equipment. The company has already executed a good number of supplies and an EC funded project worth approximately US $ 5.0 million, which is considered to be the largest single project of its kind.
Historical Backgrounds
Navana Biponon Limited, the flagship company of the Navana Group (previously Islam Group) was established in 1964 by then Group’s founder Mr. Jahurul Islam and had an auspicious step into the business under an exclusive distributorship agreement with TOYOTA of Japan to market Toyota cars in the then East Pakistan.
In the trading front, the Group has brought into existence a separate trading unit in 1996 namely Biponon Limited. This company commenced business in the potential field of Health and Medical Equipment Sector. And within a short span of one year since its commencement it was awarded with one of the biggest single tender under the Ministry of Family & Welfare, worth of US $ of 5.0 million to supply $ installation of Medical Equipment under EC finance.
The Management of the Navana Biponon Limited
Navana Biponon Limited is managed by the Board of Directors, a technical personnel and a Management Committee. The management of is simply exceptional in comparison to any other listed companies in this country. It has a blend of professionalism and wisdom, which plays a key role in managing the champion organization.
The Board of Directors includes:
- Mr. Shafiul Islam Kamal- Chairman
- Mrs. Khaleda Islam – Director
- Mr. Saiful Islam Shuman- Director
- Mr. Sajedul Islam- Director
Technical Personnel
The Technical personnel are accountable for both operational and Technical performance of the company. This committee is also responsible for policy adoption or changes, new project review, their technique.
Technical Personnel:
- Engr. Mahabub Quddus- Deputy Manager
- Md. Shahidul Islam- Service-Engineer
- Mr. Md. Nazmul Hasan- Service-Engineer
- Mr. Md. Mohiuddin- Assistant Service-Engineer
- Mr. Md. Asif Iqbal- Assistant Service-Engineer
The Management Committee
The management committee reviews and manages day-to-day business operation and recommends strategy options to the Technical personnel.
The Management Committee:
- Mr. Shafiul Islam Kamal- Chairman
- Mr. Saiful Islam Sumon- Director
- Engr. Malaya Mahanta- General Manager
Mission & Vision
Every organization has got mission & vision Navana Biponon Limited is not in difference. Its mission & vision have been given bellow:
Mission
“Each of the activities must benefit and add value to the common wealth of the society. We firmly believe that in the final analysis we are accountable to each of the constituents with whom we interact namely our employees our customers, our business associates, our fellow citizens and shareholders.
Vision
“Our vision building a healthier tomorrow where our fellow citizens will live longer, healthier and happier. Our activities have always been centered on developed core competencies to deliver the best in the industry ensuring superior value and return to our customers.”
Product / Services
Product:
The company aims to import the most robust equipment in the domestic market. In 2006 twenty (20) products were launched in the domestic market. Some major are given bellow-
- M.R.I
- C.T. Scan
- X-ray
- Colour Dropler
- Ultra Sound
- C.R. Machine
- AGFA Film
Origin of the Report
Today, practical experience is as much essential as academic education that enables someone to be successful business executive especially in the competitive business environment. In order to gather knowledge and exposure, regarding the organizational culture and behavior, the business students have to involve with internship after the successful completion of their Business Degree.
To prepare this report, I have selected and got an opportunity to work as an internee in the reputed and well known organization Navana Biponon Limited a firm of Navana Group. I have chosen the topic “Comparative Financial Statement Analysis: A case study of Navana Biponon Limited” I tired to bring out the accounting and financial performance of Navana Biponon Limited based on their corporate financial reporting. I conducted the ratio analysis and compared them with the situation of the previous years. That will reveal the actual situation of the company.
Objectives:
“Our objectives are to conduct medical equipment business within the legal and social framework with aims to attain the mission reflected by our vision”.
Methodology:
To identify the financial performance of Navana Biponon Limited. Four analytical tools for financial statement analysis are taken into consideration. These are
- Ratio Analysis
- Statement of Changes in Equity
- Cash Flow Statement
Sources of Data:
The enter report is prepared depending solely on secondary data,
Taken from the Internet and annual reports of Navana Biponon
Limited.
v No primary data are used for analysis.
NAVANA BIPONON LTD.
BALANCE SHEET
At the End of June 30, 2003
Particular | Amount |
Non – Current Assets | 290,233,403 |
Property, Plant & Equipment | 163,623,850 |
Investment | 124,745,734 |
Pre- Production Expenses | 1,863,819 |
Current Assets | 97,242,746 |
Inventories | 67,769,429 |
Accounts Receivables | 4,943,237 |
Inter Project Current Account | 112,544,564 |
Advance, Deposit & Prepayments | 9,809,058 |
Cash and Bank Balances | 2,176,458 |
Total assets | 387,476,149 |
EQUITY AND LIABILITIES | |
Capital and reserves | (316,892,790) |
Issued Capital | 203,597,600 |
Tax- holiday Reserve | 4,156,589 |
Retained Earnings | (524,646,979) |
Non Current Liabilities | |
Long Term Borrowings – Net of Current | |
Maturity ( Secured ) | – |
Current Liabilities | 704,368,939 |
Short Term Borrowings – Secured | 370,571,751 |
Long Term Borrowings – Current | – |
Maturity ( Secured) | |
Inter Project Current Account | – |
Creditors and Others Payable | 291,051317 |
Accrued Expenses | 3,089,711 |
Dividend Payable | 39,656,160 |
Total Liabilities and Shareholders’ | |
Equity | 387,476,149 |
NAVANA BIPONON LTD.
BALANCE SHEET
At the End of June 30, 2004
Particular | Amount |
Non – Current Assets | 282,402,881 |
Property, Plant & Equipment | 156,725,237 |
Investment | 124,745,734 |
Pre- Production Expenses | 931,910 |
Current Assets | 71,015,513 |
Inventories | 30,932,924 |
Accounts Receivables | 14,715,007 |
Inter Project Current Account | 13,116,534 |
Advance, Deposit & Prepayments | 9,026,618, |
Cash and Bank Balances | 3,224,430 |
Total assets | 353,418,394 |
EQUITY AND LIABILITIES | |
Capital and reserves | (41,087,336) |
Issued Capital | 203,597,600 |
Tax- holiday Reserve | 4,156,589 |
Retained Earnings | (248,841,525) |
Non Current Liabilities | |
Long Term Borrowings – Net of Current | |
Maturity ( Secured ) | 180,052,000 |
Current Liabilities | 214,453,730 |
Short Term Borrowings – Secured | 136,766,833 |
Long Term Borrowings – Current | |
Maturity ( Secured) | 22,504,000 |
Inter Project Current Account | – |
Creditors and Others Payable | 27,119,019 |
Accrued Expenses | 3,498,470 |
Dividend Payable | 24,565,408 |
Total Liabilities and Shareholders’ | |
Equity | 353,418,394 |
NAVANA BIPONON LTD.
BALANCE SHEET
At the End of June 30, 2005
Particular | Amount |
Non – Current Assets | 360,292,059 |
Property, Plant & Equipment | 264,467,064 |
Investment | 95,824,995 |
Pre- Production Expenses | – |
Current Assets | 91,254,406 |
Inventories | 44,036,877 |
Accounts Receivables | 16,791,135 |
Inter Project Current Account | 5,204,324 |
Advance, Deposit & Prepayments | 20,132,387 |
Cash and Bank Balances | 5,089,683 |
Total assets | 451,546,465 |
EQUITY AND LIABILITIES | |
Capital and reserves | (37,124,233) |
Issued Capital | 203,597,600 |
Tax- holiday Reserve | – |
Retained Earnings | (240,721,833) |
Non Current Liabilities | |
Long Term Borrowings – Net of Current | |
Maturity ( Secured ) | 315,650,415 |
Current Liabilities | 173,020,283 |
Short Term Borrowings – Secured | 136,982,667 |
Long Term Borrowings – Current | – |
Maturity ( Secured) | |
Inter Project Current Account | – |
Creditors and Others Payables | 15,69,489 |
Accrued Expenses | 4,551,555 |
Dividend Payable | 15,836,572 |
Total Liabilities and Shareholders’ | |
Equity | 451,546,465 |
NAVANA BIPONON LTD.
BALANCE SHEET
At the End of June 30, 2006
Particular | Amount |
Non – Current Assets | 344,147,713 |
Property, Plant & Equipment | 268,322,718 |
Investment | 75,824,995 |
Pre- Production Expenses | – |
Current Assets | 150,587,991 |
Inventories | 78,205,428 |
Accounts Receivables | 32,779,422 |
Inter Project Current Account | – |
Advance, Deposit & Prepayments | 24,799,183 |
Cash and Bank Balances | 14,803,958 |
Total assets | 494,735,704 |
EQUITY AND LIABILITIES | |
Capital and reserves | (25,741,388) |
Issued Capital | 203,597,600 |
Tax- holiday Reserve | – |
Retained Earnings | (229,338,988) |
Non Current Liabilities | |
Long Term Borrowings – Net of Current | |
Maturity ( Secured ) | 296,406,348 |
Current Liabilities | 224,070,744 |
Short Term Borrowings – Secured | 149,053,596 |
Long Term Borrowings – Current | |
Maturity ( Secured) | 32,713,514 |
Inter Project Current Account | 2,524,387 |
Creditors and Others Payables | 23,447,449 |
Accrued Expenses | 4,352,357 |
Dividend Payable | 11,979,441 |
Total Liabilities and Shareholders’ | |
Equity | 494,735,704 |
NAVANA BIPONON LTD.
PROFIT & LOSS ACCOUNT
At the End of June 30, 2003
Particular | Amount |
Net Sales Revenue | 45,624,741 |
Cost of Goods Sold | (36,986,928) |
Gross Profit | 8,637,813 |
Operating Expenses | (30,433,928) |
Administrative Expenses | (10,613,442) |
Selling & Distribution Expenses | (19,819,734) |
(21,795,363) | |
Finance Cost | (95,095,576) |
Profit /( Loss) from Operation | (116,890,939) |
Add Other Income | – |
Net Profit ( Loss) for the Year | (116,890,939) |
Contribute to Workers’ Profit | |
Participation Fund | – |
Net Profit before Income Tax | ((116,890,939) |
Profit/ ( Loss) brought forward | (407,756,040) |
Profit/ ( Loss) carried forward | (524,646,979) |
Earnings Per Share | (57.41) |
Number of Shares used to compute | |
EPS | 2,035,976 |
NAVANA BIPONON LTD.
PROFIT & LOSS ACCOUNT
At the End of June 30, 2004
Particular | Amount |
Net Sales Revenue | 66,825,568 |
Cost of Goods Sold | (48,924,408) |
Gross Profit | 17,901,160 |
Operating Expenses | (31,573,182) |
Administrative Expenses | (7,730,336) |
Selling & Distribution Expenses | (23,842,846) |
(13,672,022) | |
Finance Cost | (7,764,038) |
Profit /( Loss) from Operation | (21,436,060) |
Add Other Income | – |
Net Profit ( Loss) for the Year | (21,436,060) |
Contribute to Workers’ Profit | |
Participation Fund | – |
Net Profit before Income Tax | (21,436,060) |
Profit/ ( Loss) brought forward | (227,405,465) |
Profit/ ( Loss) carried forward | (248,841,525) |
Earnings Per Share | (10.53) |
Number of Shares used to compute | |
EPS | 2,035,976 |
NAVANA BIPONON LTD.
PROFIT & LOSS ACCOUNT
At the End of June 30, 2005
Particular | Amount |
Net Sales Revenue | 159,766,207 |
Cost of Goods Sold | (102,764,066) |
Gross Profit | 57,002,141 |
Operating Expenses | (44,958,594) |
Administrative Expenses | (9,222,754) |
Selling & Distribution Expenses | (35,735,840) |
12,043,547 | |
Finance Cost | (5,537,092) |
Profit /( Loss) from Operation | 6,506,455 |
Add Other Income | 840,342 |
Net Profit ( Loss) for the Year | 7,346,797 |
Contribute to Workers’ Profit | |
Participation Fund | – |
Net Profit before Income Tax | 7,346,797 |
Profit/ ( Loss) brought forward | (248,068,630) |
Profit/ ( Loss) carried forward | (240,721,833) |
Earnings Per Share | 3.61 |
Number of Shares used to compute | |
EPS | 2,035,976 |
NAVANA BIPONON LTD.
PROFIT & LOSS ACCOUNT
At the End of June 30, 2006
Particular | Amount |
Net Sales Revenue | 249,846,035 |
Cost of Goods Sold | (155,278,202) |
Gross Profit | 94,567,833 |
Operating Expenses | (67,200,531) |
Administrative Expenses | (12,866,157) |
Selling & Distribution Expenses | (54,334,374) |
27,367,302 | |
Finance Cost | (15,783,912) |
Profit /( Loss) from Operation | 11,583,390 |
Add Other Income | 735,937 |
Net Profit ( Loss) for the Year | 12,319,327 |
Contribute to Workers’ Profit | |
Participation Fund | 586,635 |
Net Profit before Income Tax | 11,732,692 |
Profit/ ( Loss) brought forward | (241,071,680) |
Profit/ ( Loss) carried forward | (229,338,988) |
Earnings Per Share | 5.76 |
Number of Shares used to compute | |
EPS | 2,036,976 |
NAVANA BIPONON LTD.
Statement of Changes in Equity
Particular | Amount in Taka
30.06.2003 |
Amount in Taka
30.06.2004 |
Amount in Taka
30.06.2005 |
Amount in Taka
30.06.2006 |
Issued Capital | 203,597,600 | 203,597,600 | 203,597,600 | 203,597,600 |
Tax- holiday Reserve | 4,156,589 | 4,156,589 | – | – |
Retained Earnings : | ||||
Net Accumulated Profit
( Loss) |
(407,756,040) | (227,405,465) | (248,068,630) | (241,071,680) |
Net Profit /(Loss) for the Year | (116,890,939) | (21,436,060) | 7,346,797 | 11,732,692 |
Net Accumulated Profit
( Loss) |
(524,646,979) | (248,841,525) | (240,721,833) | (229,338,988) |
( Balance Transferred to balance Sheet ) | ||||
Shareholders’ Equity at the end of the Year | (316,892,790) | (41,087,336) | (37,124,233) | (25,741,388) |
No. of Ordinary Shares | 2,035,976 | 2,035,976 | 2,035,976 | 2,035,976 |
Face Value Per Share | 100 | 100 | 100 | 100 |
Shareholders’ Equity Per Share | (155.65) | (20.18) | (18.23) | (12.64) |
NAVANA BIPONON LTD.
Cash Flow Statement
Particular | Amount in Taka
30.06.2003 |
Amount in Taka
30.06.2004 |
Amount in Taka
30.06.2005 |
Amount in Taka
30.06.2006 |
Cash Flows from Operating Activities : | ||||
Cash Received from Customers | 57,256.646 | 57,053,798 | 157,690,079 | 233,857,748 |
Cash Paid to Suppliers and Employees | (54,062,358) | (37,964,612) | (189,758,159) | (240,996,835) |
Cash Generated from Operation | 3,194,288 | 19,089,186 | (32,068,080) | (7,139,087) |
Other income | ||||
Income Tax Paid and Deducted at Source | (460,219) | (1,031,321) | (1,732,478) | (2,667,797) |
Net Cash Generated from | ||||
Operating Activities | 2,734,069 | 18,057,865 | (32,960,216) | (9,070,947) |
Cash Flows from Investing Activates : | ||||
Acquisition of Property, Plant & Equipment | (4,437,024) | (4,434,767) | (124,881,747) | (30,626,734) |
Invest Liquidate (Net ) | (10,783,015) | – | 28,920,739 | 20,000,000 |
Net Cash Used in Investing Activities : | (15,220,039) | (4,434,767) | (95,961,008) | (10,626,734) |
Cash Flows: from Financing Activities : | ||||
Received from Associated | 12,46,855 | 19,364,544 | (11,383,585) | 7,728,11 |
Companies & others | ||||
Dividend Paid & Written Off | 116,480 | (15,090,752) | (8,728,836) | (3,857,131) |
Bank Loans Received ( Repaid ) | 1,711,562 | (16,848,918) | 113,310,249 | 25,540,376 |
Net Cash Used in Financing Activates: | 13,874,897 | (12,575,126) | 93,797,828 | 29,411,956 |
Net Increase/ Decrease) in Cash & Cash Equivalents | 1,155,967 | 1,047,972 | 1,865,253 | 9,714,275 |
Cash & Cash Equivalents at the beginning of the Year | 1,020,491 | 1,276,458 | 3,224,430 | 5,089,683 |
Cash & Cash Equivalents at the End of the Year | 2,176,458 | 2,324,430 | 5,089,683 | 14,803,958 |
NAVANA BIPONON LTD.
Performances at a Glance
Amount in Core Taka
SL. No. | Particular | 2006 | 2005 | 2004 | 2003 |
1 | Sales | 24.98 | 15.97 | 6.68 | 4.56 |
2 | Gross Profit /( Loss) | 9.46 | 5.7 | 1.79 | 0.86 |
3 | Operating Profit / (Loss) | 2.74 | 1.2 | (1.37) | (2.18) |
4 | Net Profit /(Loss) | 1.17 | 0.73 | (2.14) | (11.69) |
5 | Earning Per Share (EPS) | 5.76 | 3.61 | (10.53) | (57.41) |
6 | Dividend Per Share | 10.00 | – | – | – |
7 | Fixed Asset | 26.83 | 26.45 | 15.67 | 16.36 |
8 | Investment | 7.58 | 9.58 | 12.47 | 12.47 |
9 | Net Working Capital | (7.35) | (8.18) | (14.34) | (60.71) |
10 | No. of Shareholders. | 8,212 | 8,451 | 8,8920 | 6.578 |
Ratio Analyses
Ratio analysis expresses the relationship among selected items of financial statement data. A ratio analysis expresses the mathematical relationship between one quantity and another. The relationship is expressed in terms of either a percentage a rate, or a simple proportion.
- Liquidity Ratio: Measure of short-term ability of the enterprise to pay its maturing obligations and to meet unexpected needs for cash.
- Profitability Ratio: Measures of the income or operating success of an enterprise for a given period of times.
- Solvency Ratio: Measures of the ability of the enterprise to survive over a long period of times.
For performance analysis of Navana Biponon Limited. Above of all ratios can be analysis and interoperate in the following ways-
Performances Analysis
Financial Performances of a company needs the assistance of its financial statement to measure the this type of performance at first we have to establish the following parameters using the balance sheet and profit & loss accounts of a financial statement
A. Liquidity Ratio:
Feature | 2006 | 2005 | 2004 | 2003 | |
i) Current Ratio : | Total Current Asset/ Total Current Liabilities | 0.67 | 0.53 | 0.33 | 0.14 |
ii) Acid Test Ratio: | Total Current Asset- Inventories / total Current Liabilities | 0.32 | 0.27 | 0.19 | 0.04 |
iii) Accounts Receivable Turnover : | Total Credit Sale / Accounts Receivable | 7.62 | 9.51 | 4.54 | 9.23 |
iv) Inventory Turnover : | Cost of Goods Sold/ Average Inventory | 1.99 | 2.33 | 1.58 | 0.55 |
B. Market Measurements:
Feature | 2006 | 2005 | 2004 | 2003 | |
i) Price Earning Ratio : | Make Price Per share
Earning Per Share |
17.35 | 27.71 | (9.50) | (1.74) |
ii) Earning Yield: | Earning Per Share / Market Price Per Share | 0.06 | 0.04 | (0.11) | (0.57) |
iii) Dividend Yield | Dividend Per Share
Market Price Per Share |
0.10 | – | – | – |
iv) Dividend Payout Raito: | Dividend Per Share / Earning Per Share | 1.74 | – | – | – |
C. Asset Utilization ratio:
Feature | 2006 | 2005 | 2004 | 2003 | |
i) Sales to Cash : | Sales / Cash Balance | 16.88 | 31.39 | 20.72 | 20.96 |
ii) Sales to Accounts Receivable | Sales / Accounts Receivable | 7.62 | 9.51 | 4.54 | 9.23 |
iii) Sales to Inventories | Sales / Inventories | 3.19 | 3.63 | -2.16 | 0.67 |
iv) Sales to Total Asset : | Sales / Fixed Asset | 0.51 | 0.35 | -0.19 | 0.12 |
D. Profitability:
Feature | 2006 | 2005 | 2004 | 2003 | |
i) Gross Profit Margin : | Gross Profit / Sales | 37.85 | 35.68 | 26.79 | 18.93 |
ii) Operating Profit to Sales | Operating Profit / Sales | 4.70 | 4.60 | (32.08) | (256.20) |
iii) Net Income to Sales | After Tax Profit / Sales | (91.79) | (150.67) | (37.37) | (1,149.92) |
E. Solvency Ratio:
Feature | 2006 | 2005 | 2004 | 2003 | |
i) Total Debt to Capital : | Total Liabilities / T. Liabilities + Equity Capital | 105.20 | 108.22 | 111.63 | 181.78 |
ii) Long Term Debt to Equity Capital: | Long Term Debt/Equity Capital : | (1,151.48) | (850.25) | (438.22) | – |
A. Liquidity Ratio
1. Current Ratio:
It shows the amount of an available meet current liability of the company. It also shows the short term liquidity of the company. High current ration means high current assets compared to current liabilities. Having high current liability is risky but if the proper matching is possible the company. Should go for high current liability and reduce financial cost. Navana Biponon Limited’s current ration is between .14 to .67. This is not a good current ration because the current liabilities are higher than that of current assets.
2. Acid Test Ratio:
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If the sales stops at any moment how much of the current liabilities company can meet from its current asset. The difference CR and ATR is due to cash & marketable securities. Keeping huge cash balance is not good for the company. Because cash is a non earning asset unless it is deposited in to interest earning accounts. So the difference between CR & ATR should not be large.
The difference between Navana Biponon Limited’s is quite high. It means that they maintain a high balance, which is not good for the company.
B. Activity Ratio:
- Inventory Turnover:
It shows that how many times the company transforms its inventory in to cash. It measures the efficiency of the company. Illogic turnover means more quickly the company is able to convert its inventory in to cash. It means the company requires less capital to invest for the same amount of sales if it can ensure inventory turnover.
Inventory turnover for Navana Biponon Limited varied form 0.67 in year 2003, 2.16 in year 2004 3.19 in year 2006 is not good for the company. IT lf 2005 is good for the company.
2. Fixed Assets Turnover Ratio:
The Fixed assets turnover Ratio measures how effectively the firm uses its plant and equipment to help generate sales. The ratio of Navana Biponon Ltd. Shows an Increasing trend from the year 2003 to 2006. This indicating that the company is using its fixed assets efficiently.
3. Receivable Turnover Ratio:
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Receivable turnover ratio ‘measures’ liquidity of receivable. Receivable turnover of year 2005 is better because RTR is 3.63
C. Market Measurement Ratio:
- Price earnings Ratio:
The Price earnings ratio measures the amount that investors are willing to pay for each taka of a firm’s earnings. The level of the price Earnings ratio indicates the degree of confidence that inventories have in the company’s future performance. The higher price earnings ratio, the higher is investor confidence. Price earning ratio of 2005 is higher than that of others. But the position of year 2004 and 2003 are Negative figure.
D. Profitability Ratio
1. Gross Profit Margin
Measures Profit generated after consideration of cost of Products Sold. This ratio actually measure the firm controls the cost of inventory or manufacturing the Products and to pass along Price Increases through the Sales of Customers. Navana Biponon Limited’s Gross Profit Ratio is 37.85 that are good sign for the company.
2. Operating Profit Margin Ratio
The Operating Profit margin measures the Percentage of each Sales Taka remaining after all costs and expenses other than interest, taxes and Preferred stock dividends are deducted. It re present the “pure profit” earned on each Sales taka. Operating Profit is “pure” because they measure only the profit earned on operations and ignore interest, taxes and preferred stock dividends. A higher operat9ing profit margin preferred. Navana Bipnon Limited’s Operating Profit Margin in 2006 is higher than that of others.
E. Solvency ratio:
1. Total Debt Equity Ratio:
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Debt equity ratio measures debt to equity base use the debt carriers risk because is require the interest as well as the principal payment.
Findings
Considering all those data collect and calculated at last we came to know the about the following situation:
Ø Navana Biponon Limited is in serious liquidity crisis.
Ø It is not highly efficient in dealings with accounts receivables and inventory management.
Ø Navana Biponon Limited should increase its sales & improve its Credit policies.
Ø Gross profit is not bad but it is underweighted due to maintain a huge liabilities.
Ø Operating profit is too poor considering its huge investment.
Ø The company is maintaining a huge loss year after year, but the situation is changing very slowly.
Ø Navana Biponon Limited Maintaining a huge debt capital in comparison with its equity capital, which is also a very bad sign.
Conclusion
It is not an easy task to overcome all those disaster situations at a time. But Navana Biponon Limited trying heart & soul to solve those successfully by utilizing its efficient man power, friendly environment at its office & maintaining world class qualities in its products. Now it is the time to take care the following situation pungently:
ü Improving its liquidity condition by increasing sales & improving receivables collection.
ü Improving its long term solvency problems by generating equity capital.
If Navana Biponon Limited can do so, then why not we hope for the best?
Bibliography
· The Annual Report of the Navana Biponon Limited for the year 2006
· The Annual Report of the Navana Biponon Limited for the year 2005
· The Annual Report of the Navana Biponon Limited for the year 2004
· The Annual Report of the Navana Biponon Limited for the year 2003
· Official web site of Navan Biponon Limited
· http://www.navana .com
· Lawrence J. Gitman-Principles of Financial Management
· Leopold A. Bernstein John J.wild-Financial Statement Analysis