Capital structure analysis
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This document analyzes and compares the capital structures of Maruti Suzuki India Ltd and Infosys. Maruti Suzuki is an automobile manufacturer established in 1981 in India, while Infosys is an IT company founded in 1981 that has expanded globally. The analysis finds that Infosys has a stronger financial position, with zero debt and high liquidity, while Maruti has taken on some debt to finance expansion. The document examines various ratios and trends over time to evaluate the solvency and leverage of the two companies.
Capital structure analysis
- 1. CAPITAL STRUCTURE ANALYSIS OFMARUTI & INFOSYSBy:PriyatoshPradhan(29)
- 3. Maruti Suzuki India Ltd is one of India's leading automobile manufacturers.Maruti Suzuki India Limited (MUL) was established in Feb 1981.Introduction
- 6. Objective of “MUL”• Modernization of the Indian Automobile Industry.• Production of fuel-efficient vehicles to conserve scarceresources.• Production of large number of motor vehicles which wasnecessary for economic growth.
- 9. MARKET SHARE
- 10. DEBT AND EQUETY
- 11. RATIO ANALYSISLIQUIDITY RATIO:These are the indicators of the ability of the company to convert its assets into cash or toobtain cash to meet short term obligationsWORKING CAPITAL:Working capital is a widely used measure of liquidity.Working Capital = Current Assets – Current Liabilities
- 12. TREND ANALYSIS
- 13. DER = LTL / Shareholder's Equity
- 14. Debt RatioDebt Ratio = Total Debt / Total AssetsEquity RatioEquity Ratio = Net worth / Total Assets
- 15. TREND ANALYSISA new plant opened at Manesar near Gurgaon in 2006. NEW K SERIES PLANT INSTALLED IN PUNE IN 2007-08.
- 16. FINANCIAL ANALYSIS INFOSYS
- 17. InfosysCompany’s profile Infosys a Banglore based company started in 1981 .
- 18. The company was the first in India to register on the American stock exchange - NASDAQ with an issue of two million American Depository Shares(ADR)that raised $70 million. Development centers in India –Mohali, Mangalore, Mysore, Hyderabad, Pune, Chennai and Bhubhaneshwar Pioneered in ESOP in INDIA.
- 19. 5thbest managed company in Asia.Global presenceGlobal development center in TORONTO.
- 20. Two Proximity center at 1.Freemont. 2.California 3.BostonInfosys continues to expand in Europe.Management ProfileThe board consists of senior officers of Infosys including all active founders, along with external members of the board who are global leaders and high achievers in business and society.
- 21. Independent Members of Board :Rama BijapukarDr.OmkarGoswamiSridarIyengarDeepak M satwalekarClaude SmadjaDr.Marti G SubrahmanyamDavid L BoylesProf.Jaffrey Sean LehmanInfosys Executives,members of the Board and CFO:V.Balakrishnan,CFOSrinath BatniK.DineshN.R,Narayana MurthyNandan M. Nilekani
- 22. NEXT GENERATION BUSINESS MODEL2008200119961981
- 23. COMPETITIVE SITUATIONHigh quality Delivery And offeringEstablished track record of Quality.Abundand Skilled Resources2.5 million english speaking graduate pools.Established IndustryServices markets(including BPO) estumated at $50 billion in 2008 ,export to grow to $60 billion in 2010. Strong Govt. SupportSignificant benefitLarge intangible benefits such as reduce time to market.Balance Sheet Of Infosys
- 24. OPERATING PROFIT
- 25. Equity Capital
- 26. Graphical form
- 27. Strong and Liquid Balance SheetHighly liquid .
- 28. Zero debt
- 29. Dividends up to 30% of annual post-tax profits
- 30. Superior return on invested capital & capital employedSOLVENCY RATIODEBT EQUITY RATIOIt is a measure of a company's financial leverage calculated by dividing its total liabilitiesby stockholders' equity. It indicates what proportion of equity and debt the company isusing to finance its assets.DER = LTL / Shareholder's Equity
- 31. Higher the current ratio, greater is the assurance we have that current liabilities will be paid.Total assets divided by shareholder equity. Asset/equity ratio is often used as a measure of leverage.(Equity Ratio = Net worth / Total Assets)COMPARITIVE ANALYSIS
- 33. MarutiInfosys
- 34. MarutiInfosys has no Debt.Solvency RatiosDebt Equity AnalysisMarutiInfosys
- 35. INFERENCEThis project helped us to know the various insights of the companies(Maruti and Infosys).We came across the various financial aspects of the companies and it is clear that the solvency of Infosys is better than that of Maruti.
Editor's Notes
- #2: By:LopamudraTripathyPriyatoshPradhanShraddhaPatnaik
- #13: TREND ANALYSIS
- #18: Pioneered in ESOP in INDIA
- #21: V.Balakrishnan,CFOSrinath BatniK.DineshN.R,Narayana MurthyNandan M. Nilekani
- #23: Large intangible benefits such as reduce time to market
- #28: Highly liquid (
- #32: INFOSYS
- #34: Infosys has no Debt
- #35: Debt Equity Analysis
- #36: This project helped us to know the various insights of the companies(Maruti and Infosys).We came across the various financial aspects of the companies and it is clear that the solvency of Infosys is better than that of Maruti.