Financial Statement Analysis

Assignment

Company : MRF
Tyres
Group 4
Submitted by :
1. Anitha Kumari A V WEB 055
2. Anoop PR

WEB 057

3. Clifton Joseph

WEB 065

4. Dhanya P Nair

WEB 066

5. Jayakrishnan S

WEB075

1. Executive Summary

Finance for any organization is equivalent to its life blood. Organization success or failure will
depend on how the firm can raise funds efficiently and how raised capital is efficiently employed
and utilized within organizations production & service sectors.

This financial cash flow analysis report examines the one of the largest tyre manufacturing
company in India, MRF Ltd. Analysis includes examination of important financial parameters of
the company to review its financial performance and health. The objective of this analysis is to
have a deeper look into the how company has managed its operations and have been able to
sustain its financial competitive advantage amongst its competitors in an industry of mixed
fortunes.
This report is an attempt to take a deeper look into the publically available financial data about
MRF for the past 3 years. Analysis tools used includes Comparative financial statement analysis,
Common-size financial statement analysis, Ratio analysis, Cash flow analysis and valuation.
This report also looks at some of the qualitative factors which support the quantitative analysis in
order to obtain a holistic view. The report is based on the secondary data which is collected from
the annual reports published about MRF Ltd. and from different websites.

2. MRF Limited

- Company Overview

MRF Limited originally known as Madras Rubber Factory Limited is a major player in the
Indian tyre manufacturing industry. Its operations include manufacturing, distribution and sale of
various kinds of vehicle tyres.
MRF manufactures tyres, tread rubber, tubes, flaps, conveyer belts and other rubber products.
The tyres manufactured by MRF are used for buses, trucks, passenger cars, formula racing cars,
off road vehicles, military vehicles, two wheelers (bikes &scooters) and three wheelers. Its
business also includes pre treads, paints, coats and toys. Its paint range includes decorative ,
pigmented, glossy and matte finishes for automobiles and for other industrial uses. Toys
manufactured by MRF are sold under FUNSKOOL brand.
MRF also provides services including Air conditioner recover and recharge unit, wheel balancer
with diagnostics, test lane for vehicle safety tests, robot controlled wheel alignment. MRF Ltd
has subsidiaries namely MRF Corp Ltd, MRF International and MRF Lanka Pvt. Ltd.
MRF now sells its products to more than 70 countries including Americas, European countries,
Middle East countries, and other Asian countries. MRF has several manufacturing facilities
located at Tamil Nadu, Kerala, Goa, Andhra Pradesh and Pondicherry.
Indian tyre industry companies aggregately reported a turnover of about Rs.51,000 crores in 20142015 and is growing at a decent rate. 93% of the total business were accounted by top 10 companies.

3. Types of Analysis
Cash Flow Analysis
2000
1500
Net Cash from Operating
Activities
(Rs in Crs)

1000
500
0
42260
42258
42256
42254
42252
-500
42261
42259
42257
42255
42253
-1000

Net Cash Used in Investing

Activities (Rs in Crs)
Net Cash Used in Financing
Activities (Rs in Crs)

-1500
-2000

Net cash from Operating Activity is showing consistent growth except for a dip in
2011and has grown from Rs.80 Cr in 2005 to Rs.1685 in 2014. This shows that that

company is generating most of its income, cash in flow from its operations.
Net Cash from investing activities have increased significantly which shows that

company is in expansion mode, to increase its production capacity.

Net Cash from financing activities has more or less remained steady, financing activities
not a major contributor to the net cash flows.

Main Sources of Cash in 2014

Sources of Cash 2014

Proceed
Interest (Net);
5% from Bank Borrowings; 5%
Trade Payables; 7%
Others;
8% of income; 50%
sources
Depreciation; 9%
Net Profit before Tax & Extraordinary Items; 16%

Main Uses of Cash in 2014

USES OF CASH: 2014

Dividend Paid; 1% On Redemption of Debenture; 2% Trade & 0th receivables; 6%
Purchase of Investments; 6%
Purchased of Fixed Assets; 46%
Interest Paid; 8%
Others; 15%
Direct Taxes Paid; 15%

Main Sources of Cash in 2013

SOURCES OF CASH 2013

Trade Payables; 6% Interest Received; 0% P/L in Forex; 0% Sale of Fixed Assets; 0%
Net Profit
before
Others;
7%Tax & Extraordinary Items; 60%
Interest (Net); 9%
Depreciation; 18%

Main Uses of Cash in 2013

USES OF CASH 2013

Others; 0% Dividend Paid; 1% Others;Trade
2% Of&the
Tem Borrowings;
3% Others; 3%
0thLong
receivables;
6%
Purchase of Investments;
26% 8%
Inventories;
Interest Paid; 10%
Purchased of Fixed Assets; 24%
Direct Taxes Paid; 17%

Main Source of Cash in 2012

SOURCES OF CASH 2012

S ale of Fixed Assets; 0%
Trade Payables; 3% Interest Received; 0%
Proceed from Bank Borrowings; 7%
Others; 8%
Interest
(Net); 10%
Net
Profit before
Tax & Extraordinary Items; 52%
Depreciation; 19%

Main Uses of Cash in 2012

USES OF CASH 2012

Others; 1% Dividend Paid; 1% Trade & 0th receivables; 5%
Inventories; 8%
Purchased of Fixed Assets; 39%
Interest Paid; 9%
Direct Taxes Paid; 15%
Purchase of Investments; 22%

4. Comparative Analysis
Sales Graph

20000
15000
10000

Sales Turnover

5000

Net Sales

0
Sep 14(12) Sep 13(12) Sep 12(12) Sep 11(12) Sep 10(12)

Sales revenues have improved year on year for the past 5 years. Compounded Sales Growth
5 Years: 18.37%
Profit Before Tax

Profit Before Tax

1,500.00
Profit Before Tax

1,000.00
500.00
0.00
Sep 14(12) Sep 13(12) Sep 12(12) Sep 11(12) Sep 10(12)

MRF has been generating profits consistently, except for a dip in 2012. Compounded Profit
Growth for past years is 29.12%.

Interest Payments

Interest
300

Interest

200
100
0
Sep 14(12)

Sep 13(12)

Sep 12(12)

Sep 11(12)

Sep 10(12)

Profit Margin

Gross Profit
2,000.00
1,000.00
0.00

Gross Profit

Sep 14(12) Sep 13(12) Sep 12(12) Sep 11(12) Sep 10(12)

Equity & Non Equity

5,000.00
4,500.00
4,000.00
3,500.00
3,000.00

Equity (Total Shareholders

Funds)

2,500.00
2,000.00

Non Equity (Total Debt)

1,500.00
1,000.00
500.00
0.00
Sep 14

Sep 13

Sep 12

Sep 11

Sep 10

Interesting to note that MRFs paid up shareholders capital is only about .1% of the reserve
funds. Company is holding huge stock pile of funds as reserves and distributes only 2.4% as
dividends. In the below chart, Share capital is seen along X Axis since it is only 1/1000 of the
Reserve Totals. Reserves have been growing steadily for the past 5 years.

5000
4000
3000

Reserves Total

2000

Share Capital

1000
0
Sep 14

Sep 13

Year
Share Capital (Rs in Crs)
Reserves Total (Rs in Crs)

Sep 12

Sep 11

Sep 14
4.24
4,513.4
0

Sep 10

Sep 13
4.24
3,640.90

Sep 12
4.24
2,853.5
6

Sep 11
4.24
2,293.5
3

Sep 10
4.24
1,686.44

Working Capital

5,000.00
4,000.00
3,000.00
2,000.00
1,000.00
0.00

Total Current Assets

Total Current Liabilities
Net Working Capital
Sep 14

Sep 13

Sep 12

Sep 11

Sep 10

Working capital increase is in line with the increase in sales revenue. Current Assets are almost
twice that of current liabilities except in the year ending in 2012.

Capital Work in Progress

Capital Work in Progress

1500
Capital Work in Progress

1000
500
0
Sep 14

Sep 13

Sep 12

Sep 11

Sep 10

Capital work in progress shows that MRF is adding more capacity on a regular basis to augment
its capacity and in line with sales revenue increases steadily across past 5 years. This is the major
use of cash in investing activities.

Common Size Analysis (Cash Flow Statement)

Sales Turnover
Total Income
Raw Materials
Total Expenditure
Operating Profit
Gross Profit
Profit Before Tax
Adjusted Net
Profit

2014
100.0%
90.4%
57.1%
76.8%
13.6%
12.0%
9.1%

2013
100.0%
90.6%
58.9%
77.2%
13.3%
11.9%
9.1%

2012
100.0%
91.3%
64.1%
81.4%
9.9%
8.7%
6.4%

2011
100.0%
98.4%
69.6%
86.8%
11.6%
10.7%
8.4%

2010
100.0%
94.4%
63.9%
83.8%
10.6%
9.8%
6.6%

6.1%

6.0%

4.4%

3.3%

4.3%

(Only main elements shown )

120.0%
100.0%
Sales Turnover
Total Income

80.0%

Raw Materials
Total Expenditure

60.0%

Operating Profit
Gross Profit

40.0%

Profit Before Tax

20.0%
0.0%
2014

Adjusted Net Profit

2013

2012

2011

2010

Raw material costs have declined and so is the total expenditure with respect to sales revenue.
Operating Profit, Gross Profit , Profit after Tax and Adjusted Net Profit have steadily improved
from over the past 5 years.

5. Common Size for Balance Sheet (MRF)

Year
SOURCES OF FUNDS :
Share Capital
Reserves Total
Equity Share Warrants
Equity Application Money
Total Shareholders Funds
Secured Loans
Unsecured Loans
Total Debt
Other Liabilities
Total Liabilities
APPLICATION OF FUNDS :
Gross Block
Less : Accumulated Depreciation
Less:Impairment of Assets
Net Block
Lease Adjustment
Capital Work in Progress
Investments
Current Assets, Loans & Advances
Inventories
Sundry Debtors
Cash and Bank
Loans and Advances
Total Current Assets
Less : Current Liabilities and
Provisions
Current Liabilities
Provisions
Total Current Liabilities
Net Current Assets
Miscellaneous Expenses not written off
Deferred Tax Assets
Deferred Tax Liability
Net Deferred Tax
Other Assets
Total Assets

Sep 14
0.00%
0.06%
58.94%
0.00%
0.00%
59.00%
19.01%
5.84%
24.85%
16.15%
100.00%

Sep 13
0.00%
0.07%
57.22%
0.00%
0.00%
57.29%
20.82%
4.31%
25.13%
17.58%
100.00%

Sep 12
0.00%
0.08%
51.31%
0.00%
0.00%
51.39%
24.35%
6.36%
30.71%
17.90%
100.00%

Sep 11
0.00%
0.09%
48.56%
0.00%
0.00%
48.65%
24.13%
9.74%
33.87%
17.48%
100.00%

Sep 10
0.00%
0.14%
55.38%
0.00%
0.00%
55.52%
16.02%
28.46%
44.48%
0.00%
100.00%

82.64%
37.86%
0.00%
44.78%
0.00%
8.18%
14.21%
0.00%
23.50%
22.31%
9.24%
2.24%
57.30%

86.05%
39.38%
0.00%
46.67%
0.00%
5.64%
14.24%
0.00%
28.22%
24.46%
5.20%
2.63%
60.50%

91.03%
38.64%
0.00%
52.40%
0.00%
7.46%
7.64%
0.00%
29.59%
26.15%
1.10%
3.79%
60.63%

81.13%
39.39%
0.00%
41.74%
0.00%
22.07%
1.54%
0.00%
32.31%
27.71%
1.19%
3.99%
65.20%

110.60%
66.96%
0.00%
43.64%
0.00%
16.34%
2.39%
0.00%
36.47%
26.65%
1.48%
4.18%
68.79%

20.78%
4.09%
24.87%
32.42%
0.00%
0.33%
3.41%
-3.07%
3.48%
100.00
%

22.06%
4.23%
26.29%
34.22%
0.00%
0.40%
3.90%
-3.49%
2.72%

23.69%
2.65%
26.33%
34.29%
0.00%
0.31%
3.67%
-3.36%
1.58%
100.00
%

27.83%
3.32%
31.15%
34.05%
0.00%
0.27%
3.27%
-3.00%
3.60%

26.03%
5.62%
31.65%
37.14%
0.00%
0.49%
0.00%
0.49%
0.00%

100.00%

100.00%

100.00%

70.00%
60.00%
Share Capital

50.00%

Reserves Total
Total Shareholders Funds

40.00%

Total Debt
Net Block

30.00%

Inventories
Capital Work in Progress

20.00%

Investments
Net Current Assets

10.00%
0.00%
Sep 14

Sep 13

Sep 12

Sep 11

Sep 10

6. Comparison of MRF and its industry peers (Apollo

Tyres and JK Tyres)
MRF LTD

Sales Turnover
Total Income
Raw Materials
Total Expenditure
Operating Profit
Gross Profit
Profit Before Tax
Adjusted Net
Profit

2014
100.0
%
90.4%

2013

2012

2011

2010

100.0%
90.6%

100.0%
91.3%

100.0%
98.4%

100.0%
94.4%

57.1%
76.8%
13.6%
12.0%
9.1%

58.9%
77.2%
13.3%
11.9%
9.1%

64.1%
81.4%
9.9%
8.7%
6.4%

69.6%
86.8%
11.6%
10.7%
8.4%

63.9%
83.8%
10.6%
9.8%
6.6%

6.1%

6.0%

4.4%

3.3%

4.3%

2014
100.0%
90.59%
61.16%

2013
100.0%
91.61%
65.26%

2012
100.0%
91.48%
69.67%

2011
100.0%
94.94%
70.00%

2010
100.0%
91.54%
58.01%

JK Tyre &
Industries Ltd
Sales Turnover
Total Income
Raw Materials

Total Expenditure
Operating Profit
Gross Profit
Profit Before Tax
Adjusted Net
Profit

81.51%

83.79%

86.72%

89.60%

80.82%

9.08%
5.30%
2.97%

7.82%
4.38%
2.50%

4.76%
1.91%
0.21%

5.33%
3.47%
1.74%

10.72%
8.38%
6.21%

2.61%

2.02%

0.17%

1.34%

4.13%

2014
100.0%
91.91%
61.65%
80.42%
11.48%
8.90%
6.34%

2013
100.0%
90.64%
64.73%
80.48%
10.17%
7.34%
5.02%

2012
100.0%
91.54%
69.74%
83.78%
7.75%
4.98%
2.89%

2011
100.0%
98.55%
70.76%
88.98%
9.56%
6.85%
4.39%

2010
100.0%
93.59%
58.92%
78.67%
14.92%
13.29%
11.03%

5.11%

3.31%

2.04%

3.15%

7.70%

Apollo Tyres Ltd

Sales Turnover
Total Income
Raw Materials
Total Expenditure
Operating Profit
Gross Profit
Profit Before Tax
Adjusted Net
Profit

MRF has adopted and consistently implemented twin prong policy of both increasing its revenue
and comparatively reduce raw material costs and other expenditures and they have been
successful in doing that in the past years and that reflects on their superior operating profit and
profit after tax as shown in the following tables.

Year
MRF LTD
JK Tyre &
Industries Ltd
Apollo Tyres Ltd

Raw Materials (% of sales)

Sep
2014
Sep-13
Sep-12
57.1%
58.9%
64.1%

Sep-11
69.6%

Sep-10
63.9%

61.16%

65.26%

69.67%

70.00%

58.01%

61.65%

64.73%

69.74%

70.76%

58.92%

Total Expenditure (% of sales)

Year
MRF LTD
JK Tyre &
Industries Ltd
Apollo Tyres Ltd

2014
76.8%

2013
77.2%

2012
81.4%

2011
86.8%

2010
83.8%

81.51%

83.79%

86.72%

89.60%

80.82%

80.42%

80.48%

83.78%

88.98%

78.67%

Operating Profit (% of sales)

2014
2013
2012
2011
MRF LTD Op Profit
13.6%
13.3%
9.9%
11.6%
JK Tyre Op
9.08%
7.82%
4.76%
5.33%
Profit

2010
10.6%
10.72%

Apollo Tyres Op
Profit

11.48%

MRF LTD PAT

JK Tyre PAT
Apollo Tyres PAT

10.17%

7.75%

9.56%

14.92%

PAT (% of sales)
6.1%
6.0%
4.4%
2.61%
2.02%
0.17%
5.11%
3.31%
2.04%

3.3%
1.34%
3.15%

4.3%
4.13%
7.70%

20.0%
MRF LTD Op Profit

15.0%

JK Tyre Op Profit
Apollo Tyres Op Profit

10.0%

MRF LTD PAT

5.0%
0.0%
2014

JK Tyre PAT
Apollo Tyres PAT
2013

2012

2011

2010

7. Performance of MRF Ltd., Apollo Tyres and JK Tyres

past 5 years
(Source : www.moneycontrol.com)

MRF stocks have faired far better when compared in comparison with its competitors and sensex
as a whole.

8. Bankruptcy Risk calculation using Altman Z Score

Z = 1.2T1 + 1.4T2 + 3.3T3 + 0.6T4 + 0.99T5.

T1 = Working Capital / Total Assets. T2 = Retained Earnings / Total Assets. T3 = Earnings

Before Interest and Taxes / Total Assets. T4 = Market Value of Equity / Book Value of
Total Liabilities. T5 = Sales/ Total Assets. Standard measure for total asset turnover
Altman Z Score
MRF Ltd
Apollo Tyres
JK Tyres

4.56
3.93
2.27

MRF Ltd has much less bankruptcy risk than its peers. JK Tyres has a high bankruptcy risk.

9. Ratio Analysis
Profitability Ratios

Operating margin (%)

20
15
10
5
0
Sep ' 14

Operating margin (%)

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Gross profit margin (%)

15
Gross profit margin (%)

10
5
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Net profit margin (%)

8
6

Net profit margin (%)

4
2
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Adjusted cash margin (%)

15
Adjusted cash margin (%)

10
5
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Adjusted return on net worth (%)

30
Adjusted return on net worth
(%)

20
10
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

ROCE (%)
30
ROCE (%)

20
10
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Reported return on net worth (%)

30
Reported return on net worth
(%)

20
10
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Return on long term funds (%)

40
30

Return on long term funds (%)

20
10
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Leverage Ratios

Long term debt / Equity

0.6
Long term debt / Equity

0.4
0.2
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Total debt/equity
0.8
0.6

Total debt/equity

0.4
0.2
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Owners fund as % of total source

75
70

Owners fund as % of total

source

65
60
55
50
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Management Efficiency Ratios

Inventory Turnover Ratio

8.5
8

Inventory Turnover Ratio

7.5
7
6.5
6
Sep '14

Sep '13

Sep '12

Sep '11

Sep '10

Fixed assets turnover ratio

4
3

Fixed assets turnover ratio

2
1
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Total Assets Turnover Ratio

3
2.5
2
1.5
1
0.5
0
Sep '14

Total Assets Turnover Ratio

Sep '13

Sep '12

Sep '11

Sep '10

Asset Turnover Ratio

4
3

Asset Turnover Ratio

2
1
0
Sep '14

Sep '13

Sep '12

Sep '11

Sep '10

Debtors Turnover Ratio

15
Debtors Turnover Ratio

10
5
0
Sep '14

Sep '13

Sep '12

Sep '11

Sep '10

Investments Turnover Ratio

8
7.5

Investments Turnover Ratio

7
6.5
6
Sep '14

Sep '13

Sep '12

Sep '11

Sep '10

Average Raw Material Holding

50
40
30
20
10
0
Sep '14

Average Raw Material Holding

Sep '13

Sep '12

Sep '11

Sep '10

Average Finished Goods Held

30
Average Finished Goods Held

20
10
0
Sep '14

Sep '13

Sep '12

Sep '11

Sep '10

Per Share Ratios

Adjusted EPS (Rs)

3,000.00
Adjusted EPS (Rs)

2,000.00
1,000.00
0.00
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Reported EPS (Rs)

3,000.00
Reported EPS (Rs)

2,000.00
1,000.00
0.00
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Dividend per share (Rs)

60
Dividend per share (Rs)

40
20
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Operating profit per share (Rs)

5,000.00
4,000.00
3,000.00
2,000.00
1,000.00
0.00
Sep ' 14

Operating profit per share

(Rs)

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Book value (incl rev res) per share EPS (Rs)

15,000.00
Book value (incl rev res) per
share EPS (Rs)

10,000.00
5,000.00
0.00
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Net operating income per share EPS (Rs)

40,000.00
Net operating income per
share EPS (Rs)

30,000.00
20,000.00
10,000.00
0.00
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Liquidity Analysis

Current ratio
2
1.5

Current ratio

1
0.5
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Current ratio (inc. st loans)

1.1
Current ratio (inc. st loans)

1
0.9
0.8
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Quick ratio
1
Quick ratio
0.5
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Inventory turnover ratio

8
7.5

Inventory turnover ratio

7
6.5
6
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Valuation Ratios

Dividend payout ratio (net profit)

8
Dividend payout ratio (net
profit)

6
4
2
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Dividend payout ratio (cash profit)

5
4
3
2
1
0
Sep ' 14

Dividend payout ratio (cash

profit)

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Earning retention ratio

100
Earning retention ratio

95
90
85
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Cash earnings retention ratio

100
Cash earnings retention ratio

98
96
94
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Coverage Ratios

Adjusted cash flow time total debt

4
Adjusted cash flow time total
debt

3
2
1
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Financial charges coverage ratio

15
Financial charges coverage
ratio

10
5
0
Sep ' 14

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Fin. charges cov.ratio (post tax)

12
10
8
6
4
2
0
Sep ' 14

10.

Fin. charges cov.ratio (post

tax)

Sep ' 13

Sep ' 12

Sep ' 11

Sep ' 10

Analysis of potential red flags

1. No major Board reshuffle in recent past

2.
3.
4.
5.
6.

No Senior Management team member has left the organization

Number of equity shares have remained same over past few years
Stock prices have not fluctuated in a wide range.
Financial reports does not indicate opaque or complex financial practices or strategies.
The source of income for MRF is from its operations which is evident from the reports
published.
7. Income from operating activities is the main source of revenue.
8. Investment expenditures are on asset building
9. Capitalization of operational expenses were not seen
10. Industry and peers also show growth though not much as achieved by MRF
11. No insider trading issues reported
12. Stocks held by reputed investor institutions
13. Promoters still hold 27% of Equity
14. Respectable Piotroski score and Altman Z Score
15. Debt to Equity Ratio is at 40%
16. Management seen as efficient in utilizing capital employed

11.

Dupont Analysis

100
80

ROE(%)

60

Net Assets/Net Worth

PAT/PBIDT(%)

40

PBDIT/Net Assets

20

Sales/Net Assets
PBIDT/Sales(%)

0
42260
42258
42256
42254
42252
42261
42259
42257
42255
42253

Consistent growth of ROE. Return on Equity for past 5 years : 24.21%

12.

Conclusion

MRF Ltd has been a success story in Indian Tyre industry. The analysis conducted as part of this
report preparation including the comparative, common size and ratio analysis , consistently point
towards strong financial performance and sound financial health of MRF. Despite the challenges
faced by the industry, MRF has poised to grow further riding on their existing financial strengths.