2. 2
HISTORY
For a quarter of a century, we have done the grunt work. We've consistently invested in R&D.
We've innovated unique, patented products. We've painstakingly built up a team that's high on
passion, persistence and the will to be different. In the process, we've met global benchmarks and
attained worldwide recognition. And after 25 years of building the most robust foundation
possible, We have arrived. Now, we're geared up for our second inning, with strategic plans,
breakthrough products, a great team and lofty visions in place.
THE FOUNDATION YEARS 1989 - 1995
1989
Incorporated as Venus Glucose Pvt.
Limited
1990
Venus Glucose An architectural layout
1992
First Functional Facility at panchkula india
1993
Establishing marketing footprints in India
3. 3
1995
Public Issue Prospectus
BETTING ON INNOVATIVE IDEA 1996 – 2004
1999
Entered in highly sophisticated Injectable
Segment
2000
Expanding Researchfacilities
2001
Commencement of Oncology Operations
2002
4. 4
Started Research in the area of Anti
microbial Resistance (AMR)
2003
Started Export in Overseas market 2004
Beginning of IPR Era _ Filed patent for in-
house developed Noval Antibiotic Asjuvent
Entity product ELORES.
INTERNATIONAL EXPANSIONS 2005 – 2008
2005
Launched Ronem(Meropenem Injection) in
Indian market Launched
2006
Acquisition of Venus Pharma GMPH in
Germany.
5. 5
2007
Best SME award from Prime Minister of
India
2007
EU GMP celebration at company premises
2008
Venus Army establishment to boost up CSR
policies
RESEARCH RECOGNITIONS 2009 - 2012
8. 8
2012
Got Good Laboratory Practices (GLP) acceditation for Venus Medical Research Centre
(VMRC)
BRAND BUILDING YEARS 2013 ONWARDS
What We Do
Nurturing
The science for a better tomorrow
Scientific ingenuity is the building block of research at Venus. We believe in catering the unmet
medical needs through translational research. Since 2004, Venus has been an active participant in
infectious disease research in India and has an extensive portfolio of patented research products
targeting Antimicrobial Resistance.
Our Vision
We strive to touch the lives of patients by actively listening and responding to their needs with
breakthrough innovative products and medical expertise that is critical for understanding and
treatment of diseases.
Our Mission
We are committed to align the best scientific approaches to develop new solutions for global
health challenges. We are actively involved in monetization of IP wealth and building global
brands backed by strong scientific evidences.
Our Focus
Our current priorities include developing therapeutic drugs targeted towards multi- drug resistant
bacteria and form synergistic partnerships to provide access to these drugs in low and middle
income countries where AMR poses greatest threat.
9. 9
Head Office
Panchkula (India)
Venus' first manufacturing unit
Operation commenced in 1991
Intravenous Infusion glass bottle facility
Annual manufacturing capacity of 7.5 mn bottles
Certifications from Ukraine (PIC nation) WHO-GMP and ISO 9001:2008
Therapy focus - Antibiotic Infusions, Neurosurgery Infusion, Pain management
Manufacturing Unit
Baddi (India)
Globally - bench marked manufacturing infrastructure
8 manufacturing facilities with annual production capacity of 78.5Mn vials
GMP certification from >20 nations
Oncology Liquid and Lyophilized : Capacity 25000 vials & 6000 Lyophilized
Antibiotics - Cephalosporins, Capacity: 80000 vials
Antibiotics - Carbapenems, Capacity: 80000 vials
Anticoagulants in Prefilled Syringes: 2,0000 Syringes
General Injections: Liquid and Lyophilized: 50000 Vials & Ampoules + 1000
Lyophilized
10. 10
Subsidiary
Venus Pharma (Germany)
Venus commenced its German operations in 2005
Wholly-owned subsidiary of Venus
Dedicated manufacturing of speciality injectibles
Accredited with EU GMP certification
Engages in site variation projects, testing , batch release and logistics for Europe
World-class quality assurance and quality control laboratories
Warehousing capacity of 3,000 pallets under controlled temperature
EXECUTIVE DIRECTORS
Pawan Chaudhary
Chairman and Managing Director
Dr. Manu Chaudhary
Joint Managing Director
11. 11
Peeyush Jain
Deputy Managing Director
Ashutosh Jain
Executive Director & Chief Executive Officer
NON-EXECUTIVE DIRECTORS
Dr. Gilbert Wenzel
Independent Non-Executive Director
Dr. Suresh K. Chadha
Independent Non-Executive Director
12. 12
Parvindra Singh Chauhan
Independent Non-Executive Director
Dr. Rupinder Tewari
Independent Non-Executive Director
PRODUCTS
Rich portfolio of innovative and generic quality products for transforming patient's life
Research
We focus on some of the toughest health care challenges. We are working relentlessly towards
our aim of possibilities to patients so as to reduce their sufferings by providing better solutions
for unmet medical needs.
Generic
We believe in the philosophy that access to medicine is the birth right of every human being. We
are commited to cut down the cost of expensive medicines to make them availaible to masses.
16. 16
MEROPENEM
ANTIBIOTIC
125 MG, 500 MG, 1 G, 250 MG,1000 MG
, 500 MG
MOXIFLOXACIN
ANTIBIOTIC
400 MG/100ML, 400 MG/100 ML ,400 MG
Operation Safety
Venus promotes Safety , Health & Environment as an integral part of its business. We strive to
prevent the environmental impact of our activities and products. We maintain a safe workplace
environment for our employees, contractors, visitors and local community. Venus promotes
Safety , Health & Environment as an integral part of its business. We strive to prevent the
environmental impact of our activities and products. We maintain a safe workplace environment
for our employees, contractors, visitors and local community. We train employees to contribute
to a safer environment at work, home and community. As an extension, all facilities and
functions are governed by an efficient use of material and energy, the substitution of hazardous
materials where feasible and the optimisation of material and recycling. Venus maintains the
highest safety and health standards. The Company is ISO14001:2004 (for environment
management) and OHSAS18001:2007 (for safety and health) certified, and each team member
has been trained to maintain these international standards. The Company's 12- member dedicated
SHE committee ensures that the each member is fully aware of the safety principles and
standards and that the safety infrastructure is fully functional at all times. The Company ensures
that every team member is capable of handling emergency situations at all times. It organise
regular classroom and practical training sessions through government approved agencies. The
Company's facilities are equipped with sophisticated fire fighting infrastructure. The Company
conducts mock drills at it's facilities from time to time. Our critical areas (general warehouses
and finished goods warehouses) are fitted with smoke sensors and multiple alarm systems. Venus
yearly celebrated the Safety and Health week to aware the employees on safety and health issues.
18. 18
MEANING OF FINANCIALANALYSIS
Financial statement refers to such statement which contains financial information about an
enterprise. Their report profitability and the financial position of the business at the end of the
Accounting period. The term financial statement includes at least two statements which the
accountant prepares at the end of accounting period. The two statements are:
The Balance Sheet
Profit And Loss Account
They provide some extremely useful information to the extent that balance Sheet mirrors the
financial position on a particular date in terms structure of assets, liabilities and owner equity,
and so on and the Profit and Loss account shows the result of operations during a certain period
of time in terms of revenues obtained and the cost incurred during the year. Thus the financial
statement provides a summarized view of financial position and operations of a firm.
The first task of financial analysis is to select the information relevant to the decision under
consideration to total information contained in the financial statement. The second step is to
arrange the information in a way to highlight significant relationship. The final step is
interpretation and drawing of the interface and conclusions. Financial Statement is the process of
selection, relation and evaluation.
FEATURES OF FINANCIALANALYSIS
To present a complex data contained in the financial statement in simple and
understandable form.
To classify the items contained in the financial statement inconvenient and rational
groups.
To make comparison between various groups to draw various conclusions.
PURPOSE OF ANALYSIS OF FINANCIALSTATEMENTS
To know the earning capacity or profitability.
To know the solvency.
19. 19
To know the financial strengths.
To know the capability of payment of interest and dividends.
To make comparative study with other firm.
To know the trend of the business.
To know the efficiency of the management.
To provide useful information to the management.
PROCEDUREOF FINANCIAL STATEMENT ANALYSIS
The following procedure is adopted for the analysis and interpretation of financial Statements:-
The analyst should know the plans and policies of the managements that he may be able
to find out whether these plans are properly executed or not.
The extent of analysis should determine so that the sphere of work may be decided. If the
aim is find out, Earning capacity of the enterprise then analysis of income statement will
be undertaken. On the other hand, if financial position is to be studied then balance sheet
analysis will be necessary.
The financial data be given in statement should be recognized and rearranged. It will
involve grouping the similar data under some heads. Breaking down of individual
components of the statement according to nature. A relationship is established among
financial statements with the help of tools and techniques of analysis such as ratios,
trends, common size, and fund flow, etc.
The information is interpreted in a simple and understandable way. The significance and
utility of financial data is explained which help in decision making.
The conclusion drawn from the interpretation is presented to the management in the form
of the report.
Analyzing financial statement involves evaluating three characteristics of the company:
Its liquidity
Its profitability
Its insolvency.
20. 20
A short-term creditor, such as a bank, is primarily interested in the liquidity. A long-term
creditor, such as a bondholder, however, looks to profitability and solvency measures that
indicate the company’s ability to survive over a long period of time
TOOLS OF FINANCIAL ANALYSIS
Various tools are used to evaluate the significance of financial statement data. Three commonly
used tools are these
Ratio Analysis
Fund Flow Analysis
Cash Flow Analysis
RATIO ANALYSIS
Ratio analysis isn’t just comparing different numbers from the balance sheet, income statement,
and cash flow statement. It means comparing the number against previous year of other
companies, the industry, or even the economy in general. Ratios look at the relationship between
individual values and relate them to how a company has performed in the past, and its
performance in the future.
RATIO
A ratio is a simple arithmetical expression of the relationship of one number to another. It may
be defined as the indicated quotient of two mathematical expressions. In simple language ratio is
one number expressed in terms of another and can be worked out by dividing one number into
another.
For example, Current assets of the firm are 5, 00,000 and Current liabilities are 2, 50,000 then
the ratio of current assets to current liabilities will work out to be 2 such type of ratio are called
simple or pure ratios.
OBJECTIVE OF RATIOS
Ratios are worked out to analyze the following aspects of business organization
21. 21
A) Solvency
Long term
Short term
Immediate
B) Stability
C) Profitability
D) Operational efficiency
E) Structural Analysis
F) Effective utilization of resources
G) Leverage or external financing
FORM OF RATIO
Since a ratio is a mathematical relationship between two or more variables, accounting figures,
such relationship can be expressed in different ways as follows:-
A) As a pure ratio
For example the equity share capital of a company is Rs. 20, 00,000 & the preference
share capital is Rs. 5,00,000 the ratio of equity share capital to preference share capital
20,00,000:5,00,000=4:1
22. 22
B) As a rate of times
In the above case the equity share capital may also be described as 4 times that of
preference share capital. Similarly, the cash sales of a firm are Rs. 12, 00,000 & credit
sales are Rs. 30, 00,000. So the ratio of credit sales to cash sales can be described as
2.5[30, 00,000/12, 00,000] = 2.5 times are the credit sales.
4
1
Sales
EQUITY SHARE CAPITAL
PREFERENCE SHARE
CAPITAL
1
2.5
Sales
CASH SALES
CREDIT SALES
23. 23
C) As a percentage
In such case, one item may be expressed as a percentage of some other items. For
example, net sale of the firm are Rs.50, 00,000 & the amount of the gross profit is Rs.
10,00,000 then the gross profit may be described as 20% of sales [10, 00,000/50, 00,000]
STEPS IN RATIO ANALYSIS
The ratio analysis requires following steps
Calculation of ratios
Comparing the ratio with some predetermined standards.
The standard ratio may be the past ratio of the same firm’s industry’s average ratio or
projected ratio or the ratio of the most successful firm in the industry. In interpreting the
ratio of the particular firm the analyst cannot reach any fruitful conclusion unless the
calculated ratio is compared with the predetermined standard.
TYPES OF COMPARISONS
The ratio can be compared in three different ways
a) Cross section analysis
One of the ways of comparing the ratios of the firm is to compare them with the ratio or
ratios of some other selected firm in the same industry at the same point of time. The
cross section analysis helps the analyst to find out as to how a particular firm has
performed in relation to its competitors. The cross section analysis is easy to be
undertaken as most of the data required for this may be available in financial statement of
the firm.
b) Time series analysis
By comparing the present performance of the firm with the performance of the same firm
over the last few years, an assessment can be made about the progress of the firm. Time
series analysis helps the firm to assess whether the firm is approaching the long-term
goals or not. The time series analysis looks for
Important trends in financial performance
Shift in trend over the years
24. 24
Significant deviation if any from the other set of data.
c) Combined analysis
If the cross section & time analysis, both are combined together to study the behavior &
pattern of ratio, then meaningful & comprehensive evaluation of the performance of firm
can definitely be made. A trend of ratio of a firm compared with the trend of ratio of the
standard firm can give good results, for example, the ratio of operating expenses to net
sales for firm may be higher than the industry however, over the years it has been
declining for the firm, whereas the industry average has not shown any significant
changes.
The combined analysis shows that the ratio of the firm is above the industry average, but
it is decreasing over the years & approaching the industry average.
NATURE OF RATIO ANALYSIS
Ratio analysis is a technique of analysis and interpretation of financial statements. It is a process
of establishing and interpreting various ratios for helping in making certain decisions. It is only a
means of better understanding of financial strengths and weaknesses of a firm. There are number
of ratios which can be calculated from the information given in the financial statements, but the
analyst has to select the appropriate data and calculate only few appropriate ratios from the same
keeping in mind the objective of analysis.
The following are the fore step involved in the ratio analysis
Selection of the relevantdata depending upon the
objectives of the analysis
Calculation of the ratio fromthe abovedata
comparison of the ratio with the pastratio
Interpretation of the ratio
25. 25
INTERPRETATIONOF THE RATIO
The interpretation of the ratios is an important factor. The limitations of ratio analysis should
also be kept in mind while implementing them. The impact of factors such as price level
changes, change in accounting policies, etc. should also be kept in mind when attempting to
interpret ratios.
The interpretation of the ratio can be made in the following ways:
Single Absolute Ratio: Generally speaking one cannot draw any meaningful conclusion
when a single ratio is considered in isolation. But single ratios may be studied in relation
to certain rules of thumb which are based upon well proven convention as for example
2:1 is considered to be a good ratio for current assets to current liabilities.
Group of Ratios: Ratios may be interpreted by calculating a group of related ratios. A
single ratios supported by another related additional ratios become more understandable
and meaningful. For example, the ratio is current assets to current liabilities to draw more
dependable conclusion.
Historical Comparison: One of the easiest and most popular ways of evaluating the
performance of the firm is to compare its present ratios with the past ratios called
comparison overtime. When financial ratios are compared over a period of time, it gives
an indication of the directions of the change and reflects whether the firm’s performance
and financial position has improved, deteriorated or remained constant over a period of
time.
Projected ratio: Ratios can also be calculated for further standard based upon the
projected or Performa financial statements. These future ratios may be taken as standard
for comparison and the ratios calculated on actual financial statements can be compared
with the standard ratios to find out variances, if any. Such variances help in interpreting
and taking corrective action for improvement in future.
Inter-firm comparison: Ratios of one firm can also be compared with the ratios of some
other selected firms in the same industry at the same point of time. This kind of
comparison helps in evaluating relative financial position and performance of the firm.
26. 26
USE AND SIGNIFICANCE OF RATIO ANALYSIS
The ratio analysis is one of the most important tools of financial analysis. It is used as a device to
analyze and interpret the financial health of the enterprise.
A. Managerial use of Ratio Analysis
1. Helps in decision making: Financial statements are prepared primarily for decision
making. But the information provided in the financial statement is not an end in itself
and no meaningful conclusion can be drawn from these statements alone. Ratio
Analysis helps in making decision from the information provided in these financial
statements.
2. Helps in financial forecasting and planning: Ratio analysis is of much help in the
financial forecasting and planning. Planning is looking ahead and the ratios calculated
for a number of years work as a guide for the future. Meaningful conclusions can be
drawn for future from these ratios. Thus, ratio analysis helps in forecasting and
planning.
3. Helps in communicating: The financial strength and weakness of the firm are
communicated in the more easy and understandable manner by the use of ratios.
4. Helps in co-ordination: Ratios even help in co-ordination which is of utmost
importance in effective business management.
5. Helps in control: Ratios analysis even helps in making effective control of the
business.
B. Utility to share holders/ investors
An investor in the company will help to assess the financial position of the concern
where he is going to invest. His first interest will be the security of his investment and
then a return in the form of dividend or interest. For the first purpose he will try to assess
the value of fixed assets and loan raised against them. The investors feel sufficient if the
investors have sufficient amount of assets.
C. Utility to creditors
The creditors or the suppliers extend short term credit to the concern. They are interested
to know whether financial position of the concern warrants their payments at the
27. 27
specified time or not. The concern pays short term creditors out of its current assets. If
current assets are quite sufficient to meet current liabilities then the creditors will not
hesitate in extending credit facility.
D. Utility to employees
The employees are also interested in the financial position of the firm especially
profitability. Their wage increases and the amount of fringe benefits are related to the
volume of profits earned by the concern. The employees make use of information
available in financial statement.
E. Utility to government-
Government is interested to know the overall strength of the industry. Various financial
statements published by industrial units are used to calculate ratios for determining short
term, long term and overall financial position of the concerns. Profitability index can also
be prepared with the help of ratios.
LIMITATION OF THE RATIO ANALYSIS
The ratio analysis is one of the most powerful tools of financial management. Though ratios are
simple to calculate and easy to understand, but there are number of limitations:
Limited use of a Single ratio: A single ratio, usually, does not convey much of a sense.
To make a better interpretation a number of ratios have to be calculated which is likely to
confuse the analyst then help him in making any meaningful conclusion.
Lack of Adequate Standards: There are no well adopted standards for all ratios which
can be accepted as norms. It renders interpretation of ratios is difficult.
Limitation of Accounting: Like financial statements, ratios also suffer from the inherent
weakness of accounting records such as their historical nature. Ratios of the past are not
necessarily true indicator of the future.
Change of Accounting Procedures: Change in the Accounting Procedures by a firm
often makes ratio analysis misleading.
Personal Bias: Ratios are only means of financial analysis and not an end in itself. Ratios
have to be interpreted and different people interpret the same ratio in different ways.
28. 28
Incomparable: Not only industries differ in their nature but also the firms of a similar
business widely differ in their size and accounting procedures, etc. it makes comparison
of ratios difficult and misleading.
Price Level Change: While making ratio analysis, no consideration is made to the
change in price levels and this makes the interpretation of ratios invalid.
Ratios no substitute: Ratio analysis is merely a tool of financial statement. Hence, ratios
become useless if separated from the statements from which they are compounded.
30. 30
REVIEW OF LITERATURE
Bansal and Gupta (1985) 2 in their study entitled, “Financial Ratio Analysis and
Statistics” enlightened that the coefficient of variation in the study period had a wide gap varying
between 7.1 per cent and 51.3 per cent for current ratio and ratio of fixed assets to sales. The
correlation of components of short term liquidity ratio generally possesses low correlation as
against long term solvency ratio components but the components of both ratios independently
possess quite satisfactory correlation in cotton textile industry. The profitability ratio elements in
the industry also have quite high correlation in cotton industry as compared to synthetic industry
Muhammad Rafiqul Islam (2000) 11 “Working Capital Management of Paper Mills in
Bangladesh-An Overall View” concluded that all the units of the paper industry had failed to
manage their working capital requirements properly. The reasons for working capital crisis were
improper use of short-term funds, operating losses, over stocking to stores and spares; and non-
availability of rawmaterials
Harris (2001) 12 analyses the link between market orientation and performance has been
claimed largely on the basis of the analysis of subjective measures of performance.
Consequently, the aim of this study is to examine the links between market orientation and
objectively measured financial performance. The paper begins with a brief examination of the
definition and components of market orientation. Thereafter, extant research into the
consequences of developing market orientation is reviewed critically, leading to the development
of a number of research hypotheses. After detailing the research design and methodology
adopted in this study, the findings of a survey of UK industry are presented. Briefly, the results
indicate that when subjective measures of performance are adopted, market orientation is
associated with company performance in certain environmental conditions. However, when
objective measures of performance are adopted, there is a narrower range of environmental
conditions where market orientation is positively associated with performance. The paper
concludes with a series of implications for both theorists and practitioners.
Bortolotti & et al. (2002) 14 examine the financial and operating performance of thirty
one national telecommunication companies in twenty five countries that were fully or partially
privatized through public share offering. Using conventional pre-versus post-privatization
31. 31
comparisons and panel data estimation techniques, they find that the financial and operating
performance of telecommunications companies improves significantly after privatization, but
that a sizable fraction of the observed improvement results from regulatory changes-alone or in
combination with major ownership changes-rather than from privatization alone.
Sahu (2002)15 in his article titled “A Simplified Model for Liquidity Analysis of Paper
Industry” has examined the liquidity of paper industry. The model developed by him has been
based on the assumption that the liquidity management of a company in a particular year is
effective if its‟ earnings before depreciation is positive and not effective if its‟ earnings before
depreciation is negative. The findings have revealed a very high predictive ability of the
estimated discriminant function.
Anshan Lakshmi (2003) 17 made “A Study of the Financial Performance with Reference
to Steel Industries Kerala Ltd”. This study covered from 1977-1998 to 2001-2002. The
objectives of the study was to analyze and evaluate the working capital management, to analyze
the liquidity position of the company, to evaluate the receivables, payables and cash management
and to suggest ways and means to improve the present date of working capital. The major tools
used for the analysis said that the working capital management suggested that the inventory
management have to be corrected.
Ooghe & et al. (2006) 21 in their paper examine the financial performance of the
acquiring firm after the acquisition, using statistical analysis of industryadjusted variables. Their
findings show that following: the acquisition, the profitability, the solvency and the liquidity of
most of the combined companies decline. This decline is also reflected in the failure prediction
scores. With respect to the added value, acquisitions are found to be accompanied by increases in
the labour productivity, but this is caused by the general improvement of gross added value per
employee of Belgian companies in the last ten years. So, it seems that, contrary to the general
expectations and beliefs, acquisitions usually do not seem to improve the acquirer's financial
performance.
Vishnani and Shah (2007) 23 investigated the impact of working capital management
policies on the corporate performance of the India consumer electronics industry. They noted
that inventory holding period, debtors‟ collection period and net working capital cycle had
32. 32
negative relationship on the profitability of firms. Whereas, the average payment periods positive
correlation with profitability.
Gaur Jighyasu (2010)35 focuses on the financial performance measures of business group
companies of India non-metallic mineral products industries. The study uses financial data of
fifty seven business group companies of Indian non-metallic mineral products industries namely
cement, glass, gems & jewellery, refractories, ceramic tiles, over a period of ten years (1999-
2008) and examines the firm‟s financial performance using performance measures through
Operating Profit and Return on net worth, the size, Leverage, Working Capital Ratio and Age of
the firm are included as determinants of firm performance. Non-metallic mineral product
categories consist of important industries of the manufacturing sector (which contributes almost
fifteen per cent to the GDP) and three- four per cent to the GDP.
34. 34
RESEARCH METHODOLOGY
Research is defined as a systematic, gathering recording and analysis of data about problem
relating to any particular field.
The following sections determine the strength, reliability and accuracy of project:
ResearchDesign
Research Design pertains to the great research approach or strategy adopted for particular
project. A research project has to be conducted significantly making sure that the data is collector
accurately and economically. The study used a descriptive research design for the purpose of
getting insight over the issue. It is to provide an accurate picture of some aspects of market
environment.
Collection of data
Oraganisationof data
Presentationof data
Analysis of data
Interpretation of data
35. 35
Method of Data Collection
Secondary Data has been gathered through the internet and published data.
Internal audit report of the company
Annual report of the company
Journals and magazines
OBJECTIVE OF THE STUDY
To understand the strong hold of Venus Remedies Ltd.
To find out the competitive advantages of Venus Remedies Ltd
To know the earning capacity or profitability.
TOOLS USED FOR ANALYSIS
In this present study ratio analysis is used as a tool for doing financial analysis of Venus
Remedies Ltd limited. Bar graph, charts are used to depict the financial information.
Limitations of the study
The time period provide for the project was not sufficient enough to gather data for a big
organization.
Complexity to gaining information.
Non-availability of the most recent statistical data.
Because of the limitation of information, some assumptions were made. So there may be
some personal mistake in the report.
Besides this, it was very difficult to carry out the whole analysis on the basis of limited
scope of study.
37. 37
FINANCIAL RESULTS AND OPERATIONS (Rs in Lacs)
2018 2017
Gross Revenue 51,672 43,581
Profit Before interest and taxation 9,610 8,052
Interest 14 16
Impairment loss and fixed assets(Net) 103 3
Provision for contingences(Net) 323 305
Provision For tax 2620 2387
Net Profit 6550 5341
Profit Brought Forward 1001 125
Amount Transferred from share Premium account - 432
Amount Transferred from general Reserves - 431
Balance available for appropriation 7551 6329
Interim Dividends 3471 2281
Special dividend - 732
Final Dividend Proposed 1205 1157
Corporate Dividend Tax 795 696
Transfer to general reserves 655 534
38. 38
Surplus carried in profit and loss account 1425 1001
Key Ratio
Earnings per Share (Rs.) 67.94 55.39
Dividend per Share (Rs.) 48.50 42.50
Pursuant to scheme arrangement
Include special dividend of Rs. 7.50 per share, paid under the Scheme of arrangement.
TOTAL INCOME
16
16.5
17
17.5
18
18.5
2014 2015 2016 2017 2018
EBIT %
EBIT %
39. 39
Current ratio may be defined as the relationship between current assets and current liabilities.
This ratio also known as working capital ratio is a measure of general liquidity and is most
widely used to make the analysis of a short-term financial position or liquidity of a firm. It is
calculated by dividing the total of current assets by total of the current liabilities.
Current Ratio =
Current Assets
Current liabilities
CURRENT ASSETS CURRENT LIABILITIES
1 Cash in hand 1 Outstanding Expenses/Accrued expenses
2 Cash at bank 2 Bills Payable
3 Marketable securities 3 Sundry Creditors
4 Short-term investments 4 Short-term advances
5 Bills Receivables 5 Income-tax payable
6 Sundry Debtors 6 Dividends Payable
0
10000
20000
30000
40000
50000
60000
2014 2015 2016 2017 2018
Net Income
Net Income
40. 40
7 Inventories (stock) 7 Bank Overdraft
8 Work- in-progress
9 Prepaid Expenses
INTERPRETATION OF CURRENT RATIO
A relatively high current ratio is an indication that the firm is liquid and has the ability to pay its
current obligations in time as and when they become due. On the other hand, a relatively low
current ratio represents that the liquidity position of the firm is not good and the firm shall not be
able to pay its current liabilities in time without facing difficulties. An increase in the current
ratio represents the improvement in the liquidity position of a firm while a decrease in the current
ratio indicates that there has been deterioration in the liquidity position of the firm.
CURRENT RATIO FOR VENUS REMEDIES LTD LIMITED FOR LAST TWO YEARS
Year 2018 2017
Current Assets 8,565,592 7,979,532
Current Liabilities 14,223,846 11,847,828
Current Ratio 0.60 0.67
The current ratio for the company in the year 2017 was 0.67 and for the year 2018 was 0.60. So
the current ratio for the firm has decreased by 0.07 which indicates that the company’s liquidity
position is decreasing. The main reason for this is the rise in the current liabilities of the
company from 11,847,828 in 2017 to 14,223,846 in 2018.There may not be sufficient funds to
pay liabilities.
41. 41
QUICK RATIO
Quick Ratio, also known as Acid Test or liquidity ratio, is the most precise test of liquidity than
the current ratio. The term ‘liquidity’ refers to the ability of the firm to pay its short term
obligations as and when they become due. The two determinant of current ratio, as a measure of
liquidity, are current assets and current liabilities.
Quick ratio =
Quick assets
Current liabilities
Quick/ liquid Assets Current liabilities
Cash in hand Outstanding or Accrued expenses
Cash at Bank Bills Payable
Bills Receivable Sundry Creditors
Sundry Debtors Short term advances
Marketable Securities Income tax payable
Temporary investment Dividends Payable
INTERPRETATIONOF QUICK RATIO
Usually, a high acid test ratio is an indication that a company is liquid and has the ability to meet
its current or liquid liabilities in time and on the other hand a low quick ratio represents that the
company’s liquidity position is not good.
42. 42
QUICK RATIO OF VENUS REMEDIES LTD LIMITED FOR LAST TWO YEARS
YEAR 2018 2017
QUICK ASSETS 3,578,213 3,630,415
CURRENT LIABILITIES 14,223,846 11,847,828
QUICK RATIO .251 .306
Hence the quick ratio of the company in 2018 was .251 and 2017 was .306 shows that the quick
ratio of the company has decreased by .55 because the company has purchased assets by the
bank balance as the company has not taken any loan during the year so the quick ratio of the
company decreased.
INVENTORYTURNOVER ORSTOCKTURNOVER RATIO
Every firm has to maintain certain level of inventory of finished goods so as to be able to meet
the requirements of the business. But the level of inventory should neither be too high nor too
low.
Inventory turnover ratio will indicate whether the inventory has been efficiently used or not. The
purpose is to see whether only the required minimum funds have been locked up in the
inventory. Inventory turnover ratio indicates the number of times the stock has been turned over
during the period and evaluates the efficiency with which a firm is able to manage its inventory.
Inventory turnover ratio
=
Cost of goods sold
Average inventory at stock
Average inventory at cost=
Opening stock + Closing Stock
2
43. 43
INTERPRETATION OF INVENTORY TURNOVER RATIO
Inventory turnover ratio measures the velocity of conversion of stock into sales. Usually, a high
inventory turnover indicates efficient management of inventory because more frequently stocks
are sold; the lesser amount of money is required to finance the inventory. A low inventory
turnover ratio indicates an inefficient management of inventory. A low inventory turnover
implies over-investment in inventories, dull business, poor quality of goods, stock accumulation,
accumulation of obsolete and slow moving goods and low profit are compared to total
investments.
INVENTORYTURNOVER RATIO OFVENUS REMEDIES LTD LIMITED
FOR LAST TWO YEARS
YEAR 2018 2017
Cost of goods sold 16465167 13563778
Average Inventory at cost 2660840.5 2444844
Inventory turnover ratio 6.18 times 5.54 times
Inventory conversion Period =
365
Inventory turnover ratio
44. 44
Inventory conversion
period
59 days 66 days
The Inventory conversion period has shifted from 66 days in 2017 and 59 days in 2018 which
shows that the company is efficiently managing their stock and its inventory turnover has also
increased which shows that there is rise in sale.
NET PROFIT RATIO
Net profit ratio establishes a relationship between net profit (after tax) and sales, and indicates
the efficiency of the management in the manufacturing, selling, administrative and other
activities of the firm. This ratio is the overall measure of firm’s profitability and is calculated as:
Net Profit Ratio =
Net profit
X 100
Sales
The two basic elements of the ratio are net profit and sales. The net profits are obtained after
deducting income-tax and, generally, non-operating income and expenses are excluded from the
net profit for calculating this ratio. Thus, incomes such as interest on investment outside the
business, profit on sale of fixed assets, etc. are excluded
NET PROFIT RATIO OF VENUS REMEDIES LTD FOR LAST TWO YEARS
Years 2018 2017
Net profit 6550 5341
45. 45
Sales 51293767 43242450
Net profit ratio .0127 .0123
There is no much difference in the net profit ratio of year 2017 and year 2018 as the net profit
and the sale has increased in the same proportion so there is not much difference in the net profit
ratio of the company.
DEBT EQUITY RATIO
Debt equity ratio also known as External-Internal Equity Ratio is calculated to measure the
relative claims of outsiders and the owners (i.e. shareholders) against the firm’s assets. This ratio
indicates the relationship between the external equities or outsiders funds and the internal
equities or the shareholders’ funds, thus
Debt-Equity Ratio =
Outsiders funds
Shareholders’ funds
The two basic components of the ratio are outsiders’ funds i.e., external equities and
shareholders’ funds, i.e. internal equities.
INTERPRETATION OF DEBT EQUITY RATIO
The debt equity ratio is calculated to measure the extent to which debt financing has been used in
the business. The ratio indicates the proportionate claims of owners and the outsiders against the
firm’s assets.
Generally speaking, a low ratio is considered as favorable from the long- term creditors’ point of
view because a high proportion of owners fund provides a larger margin of safety for them. A
high debt equity ratio which indicates that the claims of outsider are greater than those of
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owners, may not be considered by the creditors because it gives a lesser margin of safety for
them at the time of liquidation of the firm.
DEBT EQUITY RATIO FOR VENUS REMEDIES LTD LIMITED FOR
LAST TWO YEARS
Years 2018 2017
Outsiders funds 5,875,90 5,074,671
Shareholders’ Funds 5,812,650 4,733,497
Debt equity ratio 1.01 1.07
48. 48
Findings:
Final dividend of Rs 12.50 per equity share of the face value of Rs.10/- year 2018,
amounting to Rs. 1,205 Million.
The current ratio for the company in the year 2017 was 0.67 and for the year 2018 was
0.60. So the current ratio for the firm has decreased by 0.07 which indicates that the
company’s liquidity position is decreasing.
The quick ratio of the company in 2018 was .251 and 2017 was .306 shows that the quick
ratio of the company has decreased by .55 because the company has purchased assets by
the bank balance as the company has not taken any loan during the year so the quick ratio
of the company decreased.
The Inventory conversion period has shifted from 66 days in 2017 and 59 days in 2018
which shows that the company is efficiently managing their stock and its inventory
turnover has also increased which shows that there is rise in sale.
There is no much difference in the net profit ratio of year 2017 and year 2018 as the net
profit and the sale has increased in the same proportion so there is not much difference in
the net profit ratio of the company.
The Indian Pharma industry is estimated to be worth over INR 8, 80,000 Lacs.
Dividend payout ratio by Venus Remedies is over 70 % in last 20 year
50. 50
Suggestionsand Recommendations:
Employee should be trained according to the changing standards of the organization.
Company should conduct survey from time to time, according to which changes can be
introduced in the organization to stay updated in the market.
They should introduce creativity into the work, so that the employees can do their work
active mindedly.
Employee should be given compensation in order to keep them loyal.
Employee should be more involved in decision making to become more differentiated.
Company should provide incentives to shop keepers.
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CONCLUSION
The company’s overall is at a very good position. The company achieves sufficient profit in past
two years. The company maintains low liquidity to achieve the high profitability. The company
distributes dividend every year to its shareholders.
The company grew significantly during these years. There were many new products and services
that were launched during this time. Increased demand of products helps the company remain
strong. The changing lifestyle and concepts of Indians have contributing much to the growth of
the company.
