Decision Sheets

1. All figures (in millions)
Analysis and Interpretation of Cash Flow Statement of Suzlon Energy Ltd . for the year 2015-16.
Info given: - In the year end 31st
March 2015, the company reported a loss of Rs 91.58 billion and cash
generated from operations of Rs 11.19 billion. The situation reversed in the fiscal 2016 with a net profit of
Rs4.83 billion and cash used in operations is Rs. 8.05 billion.
Cash Outflow from Operating Activities
Loss before Tax in the year 2015 is (25044.2 million) and in the year is (5952.6 million) has reduced of
approx 76%.
As the net outflow of cash is reduced from 11192 million to (8050.2) million has been reduced by
171.93% as compared to previous year.
 There is decrease in depreciation of 49.85% in 2016 as compared to 2015 from the amount of Rs
8087.2 million to 4032.6 millions
 Cash expenditure are seen to be reduced , but not by a significant interest expense of 42.95%
and compensation in lieu of bank sacrifice reduced by 56.15%
 As the sale of mutual fund has been done in loss in the year 2016 of Rs 364.5 million. It shows the
outflow of cash.
 Increase in the expense of Exchange difference, net by 172% in the year 2016.(outflow of cash)
 Increase in inventories by 230% in the year 2016 as compared to the year 2015. It shows the
outflow of cash that inventory has been bought or Sales has been reduced.
 Similar reductions have been made to other non-cash expenses, including loss on asset sales
reduced by (78%), loss on investment sales (100%), amortization of ancillary borrowing costs
reduced by (15.73%), and in 2016 consolidation adjustments have reduced by (94.47%).
Interpretation :- Due to the above changes , the operating profit before working capital changes
for the year 2016 is increased by 3743.36% to Rs 13827.8 as compared to 2015.
 For the movement of working capital, there is a major change in trade receivables and unbilled
revenue as in the year 2015, the above decreased of by Rs 15750.2 resulting in a cash inflow as
debtors reduced. But as of 2016, it has increased by Rs 12483.5 resulting in cash outflow.
 Similarly in the case of inventories which have reduced in 2015 by Rs. 6721.3 and are piling up in
the year 2016 by the value of Rs. 8688: and loans, advances and the other assets have also
increased by Rs.824.6 in 2016.
 As compared to current assets, current liabilities have reduced by 99.15% from 2015 to 2016..
Interpretation:- As current assets rise, sales fall, indicating that the company has purchased
some inventory. This indicates that there is a large cash outflow and a small cash inflow. It
demonstrates a considerable gain in operational profit prior to changes in working capital, a

2. decrease in expenses, other income, and a significant decrease in losses from 2015 to 2016. The
higher current assets also reflect a lower cash outflow.
CASH FLOW FROM INVESTING ACTIVITIES
 Suzlon Energy Private Limited recorded an outflow of cash from investing operations in 2015 o
f
Rs. 7874.0, which they were able to reverse in 2016 by reporting an inflow of Rs. 65215.6 from
investing activities, representing an increase of 928.23%.
 As per observation, a major inflow of cash is from sales of stakes in subsidiary by 100% by Rs
69398 in 2016 .
 Another cash inflow is sale/maturity of current investments which has grown by 12639% from
Rs 384.7 in 2015 to Rs 47968.1 in 2016.
Interpretation:- Despite this year's investments in subsidiaries and purchases of current
investments, which are up 100% and 1809%, respectively, it is the change in sales of assets and
investments from last year to this year that has contributed the most to this year's high cash flow
from investing operations.
CASH FLOW FROM FINANCING ACTIVITIES
 Proceeds from issuance of share capital including premium have risen from Rs 81.8 in 2015 to
Rs 18000 in 2016 resulting in a 21904.89% increase reflecting a huge cash inflow.
 Repayment from long term borrowing have resulted in a large outflow by 1072.90% as it stood
at Rs 3082.6 in 2015 to Rs 36156.1 in 2016.
 Proceeds from (repayment of) short term borrowings reflects a cash inflow of Rs 11051.7 in
2015 and cash outflow of Rs 26660.9 in 2016 decreases by 341.23%.
Interpretation:- As cash outflow is seen more in repayment of long term borrowings as
compared to proceeds flowing in last year has caused the cash outflow to rise despite a much
larger increase in cash inflows after issuance of share capital.
Conclusion:-
Deduction of Rs 20669 in lieu of cash and bank balances adjusted on stake sale of subsidiary has caused
cash balances to further decline after calculation of net decrease in cash flow by 15.30% in 2016 as
compared to 2016; this is the main cause of the deduction in cash flow from the previous year to this year
despite the company's profitability position declining from 2015 to 2016.
As we can infer that liquidity position of the company has been decreased by 75% from 2015 to 2016
of amount Rs 25428.8 to Rs 6292.9