Ilkogretim Online - Elementary Education Online, 2020; Vol 19 (Issue 2): pp.

1926-1949
http://ilkogretim-online.org
doi: 10.17051/ilkonline.2020.02.696777

A Study On Financial Ratio Analysis Of Planys Technologies

Pvt. Ltd.

*V. Anbazhagan, **Dr. Abirami Siva kumar, ***Mr. H. Mohan Doss,

****Srividhya. S

*Professor, Sri Sairam Engineering College, Chennai

**Associate Professor, Business Administration, University College, Saudi Arabia
***Executive Director, Build HR, Management Consultant Pvt Lt
****Student, Sri Sairam Institute of Management Studies

ABSTRACT
A Study on Financial ratio analysis of Planys Technologies Pvt.Ltd” Ratio analysis is one
of the widely used tool of financial analysis. It means expressing one item in relation to
another in numerical term. To have a better understanding and details about the
financial statement, the analysis has been done using ratio analysis. Every business
undertaking needs finance for its smooth working. It has to raise funds from the
cheapest and less risky source to utilize this in the most effective manner. So every
company will be interested in knowing its financial performance. This study is vital
because just earning profit is not enough, a business should earn sufficient profit to
cover its cost of capital and create surplus to grow. This study aims to analyze the
liquidity, profitability, solvency position of the firm and its efficiency. The data is
collected through secondary data. The study covers a period of five years i.e. from FY
2015-2016 TO FY 2019-2020. The study reveals that the financial performance is
better. However, the shareholders fund against the outsider’s fund should be increased.
The company should take suitable measures to increase its profitability position.
Adequate steps have to be taken to improve its cash position and to reduce the
operating expenses. However, the company needs to minimize the operating expenses
to get higher net profit. In order to carry on the business successfully the company
should improve its liquidity and solvency position in the long run.

Key word: Financial Ratio, Profitability, Share holders

INTRODUCTION OF THE STUDY:

Financial statements or financial reports are formal records of the financial activities of
a business, person or other entity. It is an organized collection of data according to
logical and consistent accounting procedures. Its purpose is to convey the business
activities and the financial performance of a company. It states a series of activities over
a given period of time, as in the case of an income statement. It provides an overview of

1926 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys

Technologies Pvt. Ltd.
a business or person’s financial condition in both short and long term. In financial
statement all the relevant financial information of a business enterprise is presented in
a structured manner and in the form of easy to understand.
The focus of the financial analysis is on key figures in the financial statements and the
significant relationships exist between them. The analysis of financial statements is a
process of evaluating relationships between component parts of financial statements to
obtain a better understanding of the firm’s position and performance.

REVIEW OF LITERATURE:

Kaur (2016) in his study concluded that the advantage of ratio analysis is for judging
the company's efficiency in terms of its operations and management, locating weakness
of the company's operations, help a company to formulate future plans for establishing
future trends of its financial performance

Kumar Mohan M.S, Vasu. V. and Narayana T. (2017)in their study concluded that
different ratios, mean, standard deviation and Attman’s Z score can be used to study the
financial health of the company. The study revealed there was a positive correlation
between liquidity and profitability ratios except return on total assets as well as Z score
value indicate good health of the company.

Pavithra, J., Ramamoorthy, R., Satyapira Das, S (2018), in their study on “Evaluating
the effectiveness of working capital management in Googlesoft technologies” revealed
that the stock turnover ratio should be maintained at constant level and trend analysis
can be used for suggesting the fixed asset and current asset in order to understand the
financial condition of the company. The working capital tells about the company’s
ability of payments of short-term liabilities and financial ratios play a vital role to judge
the financial solvency of the company.

Pavithra, J., Thooyamani, K.P., Dkhar, K (2019), in their study on “The working
capital management of TVS credit services limited” concluded that the Working Capital
is a lifeline of every industry, irrespective of whether it’s a manufacturing industry or a
service industry. Working Capital is the major and most significant necessity for
carrying out the day to day processes of the business. The positive working capital
indicates that company has the ability of payments of short-term liabilities.

Hery (2020), in his study concluded that solvency or leverage ratio, is the ratio for the
measurement of a company's assets funded by debt. It can be said that the solvency
ratio or leverage ratio is used to measure the amount of debt burden that must be borne
by the company to fulfill the assets. He also concluded that Financial statements are an
important source of information for its users, especially in the context of decision
making.
1927 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys
Technologies Pvt. Ltd.
NEED FOR THE STUDY:
The study is needed to know the relationship between different financial aspects of the
company and helps in financial planning and forecasting activities. It helps to know the
existing organisational activity and its growth and aids to analyse the profitability,
solvency, working capital management, liquidity and operating effectiveness of the
company in a more realistic manner. The study is helpful to find out the existing
financial strength and weakness and helps in making quantitative and qualitative
judgements about the future prospects of the company. Financial ratios serves as an
important tool in making sound decisions about the financial viability and helps to take
appropriate decisions for the growth of the organisation at the right time.

OBJECTIVES OF THE STUDY:

❖ To analyse the existing financial position of the company.

❖ To identify the financial strengths and weakness of the company.

❖ To suggest suitable measures to improve the financial health of the company.

SCOPE OF THE STUDY:

The scope of the study primarily focuses on analyzing the organization’s existing
financial position by using financial ratios. These ratios help to identify the company’s
liquidity, profitability and solvency position of the company. It helps the management to
take necessary steps for performance improvement. Financial ratios also helps the
various stakeholders like investors, creditors, top management, customers to make
qualitative decisions. It is carried out analyse the past, current and future performance
for the purpose of making investment, credit and other economic decisions. It is helpful
to compare the company’s performance with peer companies or industry averages for
the betterment of the company.

RESEARCH METHODOLOGY:
Research Methodology is the way to systematically solve the research problem.

✔ SOURCE OF DATA: Secondary Data.

Secondary data is collected from annual reports, manuals, company records,
balance sheets and other necessary records.
✔ TYPE OF RESEARCH DESIGN: ANALYTICAL RESEARCH DESIGN.
Analytical Research Design means company’s past data is collected to analyse the
liquidity and profitability position of the company.

Data analysis and interpretation is done with the help of secondary data collected
through company’s financial statements which includes the following

1. Statement of Profit & Loss

2. Balance sheet
1928 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys
Technologies Pvt. Ltd.
 Tool used: Ratio Analysis – 1. Profitability ratios
2. Turnover ratios
3. Solvency ratios

LIMITATION OF THE STUDY:

● The study is limited to five years of Financial data
● The study is purely based on secondary data like company balance sheets, profit
& loss accounts, annual reports and company websites
● The ratio is calculated from past financial statements and these are not
indicators of future.
● Usage of different accounting principles and methods in the company which
might vary from other companies in the industry
● Price level changes, local factors, specific competition, general economic
condition and management policies are ignored in financial analysis

DATA ANALYSIS AND INTERPRETATION

COMMONSIZE BALANCE SHEET

TABLE SHOWING COMMON SIZE BALANCE SHEET AS ON YEARS 2016 & 2017

PARTICULARS 31-MAR- PERCENTAGE 31-MAR-2017 PERCENTAGE

2016
Current Assets

Cash 1,44,25,134 87.04% 8,88,480 12.76%

Other current 6,19,289 3.73% 1,92,761 2.77%

assets

Trade receivables ---- ---- 12,85,210 18.46%

Short Term loans 36,860 0.22% 5,03,765 7.24%

and advances
Total Current 1,50,81,283 90.99% 28,70,216 41.23%
Asset (A)
Non-Current
Assets

Tangible Assets 4,06,073 2.45% 36,26,053 52.08%

Intangible Assets 1,59,964 0.97% 1,58,704 2.28%

1929 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys
Technologies Pvt. Ltd.
 Capital Work in 9,25,280 5.58% ---- 4.41%
Progress

Deferred Tax ---- ---- 3,07,133 ----

Asset

Total Non- 14,91,317 9.01% 4,091,890 58.77%

Current Assets
(B)
Total Assets 1,65,72,600 100% 69,62,106 100%

Current
Liabilities

Trade Payables 2,59,079 1.56% 2,02,857 2.91%

Short Term ---- ---- 1,44 0.002%

Provisions

Other Current 36,623 0.22% 1,67,771 2.41%

Liabilities
Total Current 2,95,702 1.78% 3,70,772 5.32%
Liabilities (A)
Non-Current
Liabilities

Long Term ---- ---- 98,463 1.41%

Provisions

Deferred Tax 2,626 0.015% ---- ----

Liability
Total Non- 2,626 0.015% 98,463 1.41%
Current
Liabilities (B)
Total Liabilities 2,98,328 1.80% 4,69,235 6.73%
Shareholder’s
Funds

Share Capital 1,76,00,000 106.199% 1,76,00,000 252.79%

1930 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys

Technologies Pvt. Ltd.
 Reserves and (13,25,728) (7.99%) (1,11,07,128) (159.54%)
Surplus

Total 1,62,74,272 98.2% 64,92,872 93.271%

Shareholder’s
Funds
Total Liabilities 1,65,72,600 100% 69,62,107 100%
and Capital

TABLE SHOWING COMMON SIZE BALANCE SHEET AS ON YEARS 2017 & 2018

PARTICULARS 31-MAR- PERCENTAGE 31-MAR-2018 PERCENTAGE

2017
Current Assets

Cash& Cash 8,88,480 12.76% 6,77,87,307 84.09%

equivalents

Other current 1,92,761 2.77% 8,47,559 1.05%

assets

Trade receivables 12,85,210 18.46% 19,15,120 2.38%

Short Term loans 5,03,765 7.24% 24,48,231 3.04%

and advances
Total Current 28,70,216 41.23% 7,29,98,217 90.56%
Asset (A)
Non-Current
Assets

Tangible Assets 36,26,053 52.08% 29,39,725 3.65%

Intangible Assets 1,58,704 2.28% 9,05,680 1.12%

Capital Work in ---- 4.41% 6,69,915 0.83%

Progress

Deferred Tax Asset 3,07,133 ---- 30,96,983 3.84%

Total Non- 4,091,890 58.77% 76,12,303 9.44%

Current Assets
1931 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys
Technologies Pvt. Ltd.
 (B)
Total Assets 69,62,106 100% 8,06,10,520 100%

Current
Liabilities

Trade Payables 2,02,857 2.91% 17,90,344 2.22%

Short Term 1,44 0.002% 2,11,458 0.26%

Provisions

Other Current 1,67,771 2.41% 1,66,93,127 20.71%

Liabilities
Total Current 3,70,772 5.32% 1,86,94,929 23.19%
Liabilities (A)
Non-Current
Liabilities

Long Term 98,463 1.41% 4,99,498 0.62%

Provisions

Deferred Tax ---- ---- ---- ----

Liability
Total Non- 98,463 1.41% 4,99,498 0.62%
Current
Liabilities (B)
Total Liabilities 4,69,235 6.73% 1,91,94,427 23.81%
Shareholder’s
Funds

Share Capital 1,76,00,000 252.79% 2,21,35,600 27.46%

Reserves and (1,11,07,128) (159.54%) 3,92,80,494 48.73%

Surplus
TotalShareholder
’s Funds
64,92,872 93.271% 6,14,16,094 76.19%
Total Liabilities 69,62,107 100% 8,06,10,521 100%
and Capital

TABLE SHOWINGCOMMON SIZE BALANCE SHEET AS ON YEARS 2018 & 2019

1932 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys
Technologies Pvt. Ltd.
 PARTICULARS 31-MAR- PERCENTAGE 31-MAR-2019 PERCENTAGE
2018
Current Assets

Inventory ---- ---- 26,36,887 2.10%

Current ---- ---- 1,12,85,211 8.99%

Investment
6,77,87,307 84.09% 3,51,87,285 28.06%
Cash& Cash
equivalents

Other current 8,47,559 1.05% 73,88,300 5.89%

assets

Trade receivables 19,15,120 2.38% 65,14,938 5.19%

Short Term loans 24,48,231 3.04% 29,46,365 2.35%

and advances
Total Current 7,29,98,217 90.56% 6,59,58,986 52.59%
Asset (A)
Non-Current
Assets

Tangible Assets 29,39,725 3.65% 1,13,68,877 9.06%

Intangible Assets 9,05,680 1.12% 10,35,945 0.83%

Capital Work in 6,69,915 0.83% 2,23,58,230 17.83%

Progress

Deferred Tax 30,96,983 3.84% 2,46,94,767 19.69%

Asset

Total Non- 76,12,303 9.44% 5,94,57,819 47.41%

Current Assets
(B)
Total Assets 8,06,10,520 100% 12,54,16,805 100%
Current
Liabilities
1933 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys
Technologies Pvt. Ltd.
 Trade Payables 17,90,344 2.22% 11,42,344 0.91%

Short Term 2,11,458 0.26% 6,54,426 0.52%

Provisions

Other Current 1,66,93,127 20.71% 1,55,44,149 12.39%

Liabilities
Total Current 1,86,94,929 23.19% 1,73,40,919 13.82%
Liabilities (A)
Non-Current
Liabilities

Long Term 4,99,498 0.62% 10,53,143 0.84%

Provisions

Deferred Tax ---- ---- ---- ----

Liability
Total Non- 4,99,498 0.62% 10,53,143 0.84%
Current
Liabilities (B)
Total Liabilities 1,91,94,427 23.81% 1,83,94,062 14.67%
Shareholder’s
Funds

Share Capital 2,21,35,600 27.46% 2,57,02,600 20.49%

Reserves and 3,92,80,494 48.73% 8,13,20,143 64.84%

Surplus

Total 6,14,16,094 76.19% 10,70,22,743 85.33%

Shareholder’s
Funds
Total Liabilities 8,06,10,521 100% 12,54,16,805 100%
and Capital

TABLE SHOWINGCOMMON SIZE BALANCE SHEET AS ON YEARS 2019 & 2020

PARTICULARS 31-MAR- PERCENTAGE 31-MAR-2020 PERCENTAGE

2019
Current Assets
1934 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys
Technologies Pvt. Ltd.
 Inventory 26,36,887 2.10% 68,36,803 6.35%

Current 1,12,85,211 8.99% 92,453 0.09%

Investment
3,51,87,285 28.06% 28,32,997 2.63%
Cash& Cash
equivalents

Other current 73,88,300 5.89% 1,03,04,747 9.57%

assets

Trade receivables 65,14,938 5.19% 3,18,49,601 29.58%

Short Term loans 29,46,365 2.35% 19,69,498 1.82%

and advances
Total Current 6,59,58,986 52.59% 5,38,86,099 50.04%
Asset (A)
Non-Current
Assets

Tangible Assets 1,13,68,877 9.06% 1,30,82,624 12.15%

Intangible Assets 10,35,945 0.83% 15,95,218 1.48%

Capital Work in 2,23,58,230 17.83% 1,19,83,263 11.13%

Progress

Deferred Tax 2,46,94,767 19.69% 2,71,42,378 25.20%

Asset

Total Non- 5,94,57,819 47.41% 5,38,03,483 49.96%

Current Assets
(B)
Total Assets 12,54,16,805 100% 10,76,89,582 100%
Current
Liabilities

Short Term
Borrowings ---- ---- 79,55,182 7.39%

1935 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys

Technologies Pvt. Ltd.
 Trade Payables 11,42,344 0.91% 14,40,605 1.34%

Short Term 6,54,426 0.52% 2,69,700 0.25%

Provisions

Other Current 1,55,44,149 12.39% 1,30,37,634 12.11%

Liabilities
Total Current 1,73,40,919 13.82% 2,27,03,121 21.09%
Liabilities (A)
Non-Current
Liabilities

Long Term 10,53,143 0.84% 32,06,584 2.98%

Provisions

Deferred Tax ---- ---- ---- ----

Liability
Total Non- 10,53,143 0.84% 32,06,584 2.98%
Current
Liabilities (B)
Total Liabilities 1,83,94,062 14.67% 2,59,09,705 24.06%

Shareholder’s
Funds

Share Capital 2,57,02,600 20.49% 2,57,02,600 23.87%

Reserves and 8,13,20,143 64.84% 5,60,77,275 52.07%

Surplus

Total 10,70,22,743 85.33% 8,17,79,875 75.94%

Shareholder’s
Funds
Total Liabilities 12,54,16,805 100% 10,76,89,580 100%
and Capital

INTERPRETATION:
In CommonsizeBalancesheet, total assets and total liabilities is taken as a base and all
other figures are expressed as percentage of this total. There is a gradual increase in the

1936 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys

Technologies Pvt. Ltd.
current and noncurrent assets from the period 31 st March 2016 to 31st March
2020.There is a fluctuation in the current liabilities of Planys technologies Pvt ltd. It is
increasing for the first two years and gradually decreasing for the next two financial
years. There is an upward growth in non-current liabilities. There is a positive growth in
the Shareholder’s funds from 2016 to 2020. The total current assets for the period
ended 31st March 2016 was Rs. 1,50,81,283 and it has increased to Rs. 5,38,86,099 for
the year ended 31st March 2020. The total non-current assets for the period ended 31 st
March 2016 was Rs. 14,91,317 and it has increased to Rs. 5,38,03,483 for the year
ended 31st March 2020. The total current liabilities for the period ended 31 st March
2016 was Rs. 2,95,702 and it has increased to Rs. 2,27,03,121 for the year ended 31 st
March 2020.The total non- current liabilities for the period ended 31 st March 2016 was
Rs. 2626 and it has increased to Rs. 32,06,584 for the year ended 31 st March 2020.

COMPARATIVE BALANCESHEET

TABLE SHOWINGCOMPARATIVE BALANCE SHEET AS ON YEARS 2016 & 2017

PARTICULARS 31-MAR- 31-MAR-2017 INCREASE (+) PERCENTAGE
2016 DECREASE (-)
Assets:
Current Assets

Cash 1,44,25,134 8,88,480 -1,35,36,654 -93.84%

Other current 6,19,289 1,92,761 -4,26,528 -68.87%

assets

Trade receivables ---- 12,85,210 +12,85,210 ----

Short Term loans 36,860 5,03,765 +4,66,905 +1266.70%

and advances
Total Current 1,50,81,283 28,70,216 -1,22,11,067 -80.971%
Asset (A)
Non-Current
Assets

Tangible Assets 4,06,073 36,26,053 +32,19,980 +729.96%

Intangible Assets 1,59,964 1,58,704 -1,260 -0.79%

Capital Work in 9,25,280 ---- -9,25,280 ----

Progress

1937 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys

Technologies Pvt. Ltd.
 Deferred Tax ---- 3,07,133 +3,07,133 ----
Asset

Total Non- 14,91,317 4,091,890 +26,00,573 +174.38%

Current Assets
(B)
Total Assets 1,65,72,600 69,62,106 -96,10,494 -57.99%
Liabilities &
Capital

Trade Payables 2,59,079 2,02,857 -56,222 -21.70%

Short Term ---- 1,44 +1,44 ----

Provisions

Other Current 36,623 1,67,771 +1,31,148 +358.10%

Liabilities
Total Current
Liabilities (A) 2,95,702 3,70,772 +75,070 +25.39%

Non-Current
Liabilities

Long Term ---- 98,463 +98,463 ----

Provisions

Deferred Tax 2,626 ---- -2,626 ----

Liability
Total Non- 2,626 98,463 +95,837 +3649.54%
Current
Liabilities (B)
Total Liabilities 2,98,328 4,69,235 +1,70,907 +57.29%
Shareholder’s
Funds

Share Capital 1,76,00,000 1,76,00,000 ---- ----

Reserves and (13,25,728) (1,11,07,128) -97,81,400 -737.81%

Surplus

1938 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys

Technologies Pvt. Ltd.
 Total 1,62,74,272 64,92,872 -97,81,400 -60.10%
Shareholder’s
Funds
Total Liabilities 1,65,72,600 69,62,107 -96,10,493 -57.99%
and Capital

TABLE SHOWINGCOMPARATIVE BALANCE SHEET AS ON YEARS 2017& 2018

PARTICULARS 31-MAR- 31-MAR-2018 INCREASE (+) PERCENTAGE

2017 DECREASE (-)
Current Assets

Cash& Cash 8,88,480 6,77,87,307 +6,68,98,827 +7529.58%

equivalents

Other current 1,92,761 8,47,559 +6,54,798 +339.69%

assets

Trade receivables 12,85,210 19,15,120 +6,29,910 +49.01%

Short Term loans 5,03,765 24,48,231 +19,44,466 +385.99%

and advances
Total Current 28,70,216 7,29,98,217 +7,01,28,001 +2443.30%
Asset (A)
Non-Current
Assets

Tangible Assets 36,26,053 29,39,725 -6,86,328 -18.93%

Intangible Assets 1,58,704 9,05,680 +7,46,976 +470.67%

Capital Work in ---- 6,69,915 +6,69,915 ----

Progress

Deferred Tax 3,07,133 30,96,983 +27,89,850 +908.35%

Asset

Total Non- 4,091,890 76,12,303 +35,20,413 +86.03%

Current Assets
1939 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys
Technologies Pvt. Ltd.
 (B)
Total Assets 69,62,106 8,06,10,520 +7,36,48,414 +1057.85%

Current
Liabilities

Trade Payables 2,02,857 17,90,344 +15,87,487 +782.56%

Short Term 1,44 2,11,458 +2,11,314 +146745.83%

Provisions

Other Current 1,67,771 1,66,93,127 +1,65,25,356 +9849.95%

Liabilities
Total Current 3,70,772 1,86,94,929 +1,83,24,157 +4942.16%
Liabilities (A)
Non-Current
Liabilities

Long Term 98,463 4,99,498 +4,01,035 +407.30%

Provisions

Deferred Tax ---- ---- ----

Liability
Total Non- 98,463 4,99,498 +4,01,035 +407.30%
Current
Liabilities (B)
Total Liabilities 4,69,235 1,91,94,427 +1,87,25,192 +3990.58%
Shareholder’s
Funds

Share Capital 1,76,00,000 2,21,35,600 +45,35,600 +25.77%

Reserves and (1,11,07,128) 3,92,80,494 +5,03,87,622 +453.65%

Surplus
Total 64,92,872 6,14,16,094 +5,49,23,222 +845.90%
Shareholder’s
Funds
Total Liabilities 69,62,107 8,06,10,521 +7,36,48,414 +1057.85%
and Capital

1940 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys

Technologies Pvt. Ltd.
TABLE SHOWINGCOMPARATIVE BALANCE SHEET AS ON YEARS 2018& 2019

PARTICULARS 31-MAR- 31-MAR-2019 INCREASE (+) PERCENTAGE

2018 DECREASE (-)
Current Assets

Inventory ---- 26,36,887 +26,36,887 ----

Current ---- 1,12,85,211 +1,12,85,211 ----

Investment
6,77,87,307 3,51,87,285 -3,26,00,022 -48.09%
Cash& Cash
equivalents

Other current 8,47,559 73,88,300 +65,40,741 +771.72%

assets

Trade receivables 19,15,120 65,14,938 +45,99,818 +240.18%

Short Term loans 24,48,231 29,46,365 +4,98,134 +0.20%

and advances
Total Current 7,29,98,217 6,59,58,986 -70,39,231 -9.64%
Asset (A)
Non-Current
Assets

Tangible Assets 29,39,725 1,13,68,877 +84,29,152 +286.73%

Intangible Assets 9,05,680 10,35,945 +1,30,265 +14.38%

Capital Work in 6,69,915 2,23,58,230 +2,16,88,315 +3237.47%

Progress

Deferred Tax 30,96,983 2,46,94,767 +2,15,97,784 +697.38%

Asset

Total Non- 76,12,303 5,94,57,819 +5,18,45,516 +681.08%

Current Assets
(B)
Total Assets 8,06,10,520 12,54,16,805 +4,48,06,285 +55.58%

1941 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys

Technologies Pvt. Ltd.
 Current
Liabilities

Trade Payables 17,90,344 11,42,344 -6,48,000 -36.19%

Short Term 2,11,458 6,54,426 +4,42,968 +209.48%

Provisions

Other Current 1,66,93,127 1,55,44,149 -11,48,978 -6.88%

Liabilities
Total Current 1,86,94,929 1,73,40,919 -13,54,010 -7.24%
Liabilities (A)
Non-Current
Liabilities

Long Term 4,99,498 10,53,143 +5,53,645 +110.84%

Provisions

Deferred Tax ---- ---- ----

Liability
Total Non- 4,99,498 10,53,143 +5,53,645 +110.84%
Current
Liabilities (B)
Total Liabilities 1,91,94,427 1,83,94,062 -8,00,365 -4.17%
Shareholder’s
Funds

Share Capital 2,21,35,600 2,57,02,600 +35,67,000 +16.11%

Reserves and 3,92,80,494 8,13,20,143 +4,20,39,649 +107.02%

Surplus

Total 6,14,16,094 10,70,22,743 +4,56,06,649 +74.261%

Shareholder’s
Funds
Total Liabilities 8,06,10,521 12,54,16,805 +4,48,06,284 +55.58%
and Capital

TABLE SHOWINGCOMPARATIVE BALANCE SHEET AS ON YEARS 2019& 2020

1942 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys

Technologies Pvt. Ltd.
 PARTICULARS 31-MAR- 31-MAR-2020 INCREASE (+) PERCENTAGE
2019 DECREASE (-)
Current Assets

Inventory 26,36,887 68,36,803 +41,99,916 +159.28%

Current 1,12,85,211 92,453 -1,11,92,758 -99.18%

Investment
3,51,87,285 28,32,997 -3,23,54,288 -91.95%
Cash& Cash
equivalents

Other current 73,88,300 1,03,04,747 +29,16,447 +39.47%

assets

Trade receivables 65,14,938 3,18,49,601 +2,53,34,663 +388.87%

Short Term loans 29,46,365 19,69,498 -9,76,867 -33.15%

and advances
Total Current 6,59,58,986 5,38,86,099 -1,20,72,887 -18.30%
Asset (A)
Non-Current
Assets

Tangible Assets 1,13,68,877 1,30,82,624 +17,13,747 +15.07%

Intangible Assets 10,35,945 15,95,218 +5,59,273 +53.99%

Capital Work in 2,23,58,230 1,19,83,263 -1,03,74,967 -46.40%

Progress

Deferred Tax 2,46,94,767 2,71,42,378 +24,47,611 +9.91%

Asset

Total Non- 5,94,57,819 5,38,03,483 -56,54,336 -9.51%

Current Assets
(B)
Total Assets 12,54,16,805 10,76,89,582 -1,77,27,223 -14.13%

Current
Liabilities
1943 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys
Technologies Pvt. Ltd.
 Short Term ---- 79,55,182 +79,55,182 ----
Borrowings

Trade Payables 11,42,344 14,40,605 +2,98,261 +26.11%

Short Term 6,54,426 2,69,700 -3,84,726 -58.79%

Provisions

Other Current 1,55,44,149 1,30,37,634 -25,06,515 -16.13%

Liabilities
Total Current 1,73,40,919 2,27,03,121 +53,62,202 +30.92%
Liabilities (A)
Non-Current
Liabilities

Long Term 10,53,143 32,06,584 +21,53,441 +204.48%

Provisions

Deferred Tax ---- ---- ---- ----

Liability
Total Non- 10,53,143 32,06,584 +21,53,441 +204.48%
Current
Liabilities (B)
Total Liabilities 1,83,94,062 2,59,09,705 +75,15,643 +40.86%
Shareholder’s
Funds

Share Capital 2,57,02,600 2,57,02,600 ---- ----

Reserves and 8,13,20,143 5,60,77,275 -2,52,42,868 -31.04%

Surplus

Total 10,70,22,743 8,17,79,875 -2,52,42,868 -23.59%

Shareholder’s
Funds
Total Liabilities 12,54,16,805 10,76,89,580 -1,77,27,225 -14.13%
and Capital

1944 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys

Technologies Pvt. Ltd.
INTERPRETATION:
Comparative balance sheet helps to summarise and compare the related data for a
number of years, incorporating the changes in individual items of financial statements.
Upward growth is indicated with positive sign and downward growth is indicated with
negative sign. There has been gradual increase in the current and non-current assets for
the period 31st March 2016 to 31st March 2020. There is an increase in the current
liabilities when compared to the prior financial statement periods. There is a positive
growth in the non-current liabilities. There is a minimal fluctuation in the shareholder’s
funds from the period 31st March 2016 to 31st March 2020.

FINDINGS:
● The ideal current ratio is 2:1. The current ratio of Planys Technologies Pvt Ltd is
decreasing from 51.001 to 2.373. The current ratio is highest in the year 2015-
2016 ie51.001 : 1 and lowest in the year 2019-2020 ie 2.373 : 1.This indicates
the short-term liquidity of the company.
● The liquid ratio of Planys Technologies Pvt Ltd is decreasing from 49.569 to
2.058. The liquid ratio is highest in the year 2015-2016 ie49.569 : 1 and lowest
in the year 2019-2020 ie 2.058 : 1. Higher liquid ratio means the company has a
better financial position in short term and indicates its ability to meet out its
current liabilities.
● The net profit ratio of Planys Technologies Pvt Ltd is decreasing and giving
negative returns. A low net profit ratio indicates decrease in profit as it is a start-
up company and is in the growing stage of its lifecycle.
● The debtor’s turnover ratio of Planys Technologies Pvt Ltd is highest in the year
2019-2020 ie 3.9 Times and it is lowest in the year 2015-2016.Higher debtor's
turnover ratio indicates faster turnaround and reflects positively on the liquidity
of the company.
● The fixed assets turnover ratio of Planys Technologies Pvt Ltd is progressively
increasing from 0.16 Times to 2.806 Times. It is highest in the year 2019-2020 ie
2.806 Times and lowest in the year 2015-2016 ie 0.16 Times. Maximum ratio
indicates that the company has generated greater revenue by investing more
amount in fixed assets.
● The working capital turnover ratio of Planys Technologies Pvt Ltd is highest in
the year 2019-2020 ie 2.399 Times and lowest in the year 2015-2016 ie 0.016
Times. A higher working capital turnover ratio indicates that the company is able
to generate a large amount of revenue and is in a better financial position.
● The cash ratio of Planys Technologies Pvt Ltd is highest in the year 2015-16
ie48.78: 1 and it is lowest in the year 2019-2020 ie0.128 : 1. A high cash ratio
implies that the company has a lot of cash available to pay maturing liabilities.
● The proprietary ratio of Planys Technologies Pvt Ltd is highest in the year 2015-
16 ie1.017 : 1 and lowest in the year 2019-2020 ie 0.773 : 1. The highest ratio

1945 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys

Technologies Pvt. Ltd.
 indicates that the company has a sufficient amount of equityto support the
functions of the business.
● The return on shareholder’s funds ratio of Planys Technologies Pvt Ltd is
becoming negative. This shows that return on shareholder’s funds is yielding
negative returns and not generating adequate amount of profits.
● The Debt Equity ratio of Planys Technologies Pvt Ltd is highest in the year 2019-
2020 ie 0.039 and lowest in the year 2017-2018 ie 0.008. A low Debt Equity
ratio indicates a lower amount of financing by debt via lenders, versus funding
through equity via shareholders.
● There is a gradual increase in the current and noncurrent assets from the period
31st March 2016 to 31st March 2020.
● There is a fluctuation in the current liabilities of Planys technologies Pvt ltd. It is
increasing for the first two years and gradually decreasing for the next two
financial years.
● There is a upward growth in non-current liabilities.
● There is a positive growth in the Shareholder’s funds for the period 31st March
2016 to 31st March 2020.
● There is an upward trend in the current assets and non-current assets from the
period 31st March 2016 to 31st March 2020. There is a declining trend for the
non-current liabilities as it is paid off when the liability arises. There is a gradual
upward trend in the shareholder’s funds for the period 31st March 2016 to 31st
March 2020.

SUGGESTIONS:
● The shareholders fund against the outsider’s fund should be increased.
● Net fixed asset of the company has increased but it is not utilized to the
maximum level. Hence the management should take initiative steps for the
proper utilization of the resources.
● The company must take adequate steps to increase its financial strength and its
solvency position.
● The investment of the company is very good and increasing year by year and
hence the company must implement suitable strategies to maintain that
financial position.
● The company should take suitable measures to increase its profitability position.
● Adequate steps have to be taken to improve its cash position since cash ratio is
not good and it is fluctuating.
● The owner’s contribution to the total assets can be increased.
● Operating expenses of the company is high. Hence the management should take
appropriate steps to reduce the operating expenses.
● Equity position can be improved.
● The company should try to increase its asset holding thereby it can increase the
profitability and liquidity position.
1946 | V. Anbazhagan A Study On Financial Ratio Analysis Of Planys
Technologies Pvt. Ltd.
 ● The company should also take appropriate steps to reduce its current and non-
current liabilities in the long run.
● The company can also try to increase its working capital efficiency as it will be
helpful for future growth and development.
● The various operating and non-operating can be reduced in order to generate
greater revenue for the company in the long run.
● Investments made by the company has to be properly channelized in the
appropriate source of investment so that the profitability and solvency position
of the company can be improved.

CONCLUSION:
After analysis of the financial performance of Planys Technologies Private Limited for
the period of five years from 2015 to 2020, the study reveals that the overall financial
performance of the company is improving gradually. The company should take
appropriate steps to increase the operating efficiency so as to generate larger amount of
revenue and growth. By cutting down operating costs and increasing the amount of
revenue, the company can aim for expansion and development. The company should
devise appropriate strategies to increase its liquidity, profitability and solvency
position. However, it needs to minimize the operating expenses to get higher net profit.
In order to carry on the business successfully the company should improve its liquidity
and solvency position in the long run.

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