A STUDY ON RATIO ANALYSIS AT IIFL SECURITIES LTD

30214MG701 - PROJECT WORK

Submitted by
SIVAKUMARAN J
(21PMBM0021)
in partial fulfillment for the award of the degree
of

MASTER OF BUSINESS ADMINISTRATION

Under the guidance of
DR. LEENA JENEFA
Associate Professor

DEPARTMENT OF MANAGEMENT STUDIES

SCHOOL OF MANAGEMENT

Vel Tech Rangarajan Dr. Sagunthala R&D Institute of Science and

Technology, Avadi, Chennai - 600 062

May 2023
 CERTIFICATE

This is to certify that the project entitled “A STUDY ON RATIO ANALYSIS AT IIFL SECURITIES
LTD” submitted by SIVAKUMARAN. J (21PMBM0021) in partial fulfillment for the requirements for the
award of Master of Business Administration is an authentic work carried out by them under my supervision
and guidance.

To the best of my knowledge, the matter embodied in the project report has not been submitted to any

other University/Institute for the award of any Degree or Diploma.

Signature of Guide Signature of Head of the Department Signature of Dean

Submitted for the partial fulfillment for the award of the degree of Master of Business Administration from
Vel Tech Rangarajan Dr. Sagunthala R&D Institute of Science and Technology, Avadi,
Chennai - 600 062

Internal Examiner: …………….…… External Examiner: ………………………

Date:……………………
 DECLARATION

I, SIVAKUMARAN. J (21PMBM0021), M.B.A student of Vel Tech Rangarajan Dr.

Sagunthala R&D Institute of Science and Technology, Avadi, Chennai - 600 062 would like to declare
that the project work entitled “A STUDY ON RATIO ANALYSIS AT IIFL SECURITIES LTD” in partial
fulfillment of Master of Business Administration under Vel Tech Rangarajan Dr. Sagunthala R&D Institute
of Science and Technology, Avadi, Chennai - 600 062, is original project done independently by me under
the Academic guidance of Dr. LEENA JENEFA , Associate Professor, Department of Management Studies,
Vel Tech Rangarajan Dr. Sagunthala R&D Institute of Science and Technology, Avadi, Chennai and Industry
guidance of Mr.K.PERUMAL Manager-FAN in IIFL SECURITIES LTD.

Place: Chennai Student Signature

Date: (SIVAKUMARAN.J)

Phone:9025872419
E mail:vtp3150@veltech.edu.in
 ACKNOWLEDGEMENT

I would like to express my faithful thanks to Our Dean Dr. M. S. R. MARIYAPPAN, MBA, M.Phil,
Ph.D. , A.C.I.M., Head of the Department Dr.K.RAVISHANKAR, MBA., PGDMM., Ph.D., Vel Tech
Department of management studies for having motivated and extended full support for effective
completion of the project.

A Special thanks to Dr. LEENA JENEFA, Associate Professor, Department of management studies, Vel
Tech Rangarajan Dr.Sagunthala R&D Institute of Science and Technology, Avadi, Chennai - 600 062 and
of Mr.K.PERUMAL Manager-FAN in IIFL SECURITIES LTD for their extremely valuable guidance
and support for the completion of this project work successfully.

I also extend my sincere thanks to my Parents, Friends and all Faculties of the Vel tech Department of
management studies for the help they extended to us for completion of this project.
 TABLE OF CONTENTS

CHAPTERS PARTICULARS PAGE

NO
EXECUTIVE SUMMARY i
LIST OF TABLES ii
LIST OF CHARTS iii
I 1.1 INTRODUCTION 1
1.2 INDUSTRY PROFILE 3
1.3 COMPANY PROFILE 5
1.4 REVIEW OF LITERATURE 7
1.5 STATEMENT OF PROBLEM 9
1.6 OBJECTIVES OF STUDY 10
1.7 SCOPE OF STUDY 11
1.8 LIMITATION OF STUDY 12
II 2.RESEARCH METHODOLOGY 13
2.1 RESEARCH DESIGN 13
2.2 TOOLS FOR DATA COLLECTION 14
III 3. DATA ANALYSIS AND INTEPRETATION 15
IV 4.1 SUMMARY OF FINDINGS 28
4.2 SUGGESTIONS AND RECOMMENDATIONS 29
4.3 COMCLUSION 30
BIBLIOGRAPHY 31
ANNEXURE 32
i. BALANCE SHEET OR ANY OTHER
SECONDARY DATA
 EXECUTIVE SUMMARY
This is the internship report based on the one and half month internship program that I had
successfully completed in IIFL SECURITIES LTD from MAR 29, 2023 until MAY 20, 2023
as a requirement of my MBA program on Department of Management Studies, VelTech
University.

In this title a study on Ratio Analysis at IIFL Securities ltd this aim is to analysis the financial
position of the company using the financial tools. This study based on financial statement such
as Ratio analysis and financial performance. By using this tool combined it enables to determine
in an effective manner. This research helps to identify and give suggestion the area of weaker
position of business transaction in IIFL Securities ltd and it also help to improve the financial
health of the IIFL Securities Ltd. The period considered for the study is five years (2017-2018
to 2021-2022).

i
 LIST OF TABLES

TABLE PARTICULARS PAGE

NO NO

3.1 CURRENT RATIO 17

3.2 QUICK RATIO 18

3.3 FIXED ASSETS TUNOVER RATIO 20

3.4 WORKING CAPITAL TURNOVER RATIO 21

3.5 GROSS PROFIT RATIO 23

3.6 NET PROFIT RATIO 24

3.7 OPERATING RATIO 25

3.8 RETURN ON TOTAL SHAREHOLDES’S FUND 26

3.9 TREND ANALYSIS 27

ii
 LIST OF TABLES

TABLE PARTICULARS PAGE

NO NO

3.1 CURRENT RATIO 17

3.2 QUICK RATIO 18

3.3 FIXED ASSETS TUNOVER RATIO 20

3.4 WORKING CAPITAL TURNOVER RATIO 21

3.5 GROSS PROFIT RATIO 23

3.6 NET PROFIT RATIO 24

3.7 OPERATING RATIO 25

3.8 RETURN ON TOTAL SHAREHOLDES’S FUND 26

3.9 TREND ANALYSIS 27

iii
 CHAPTER 1

1.1 INTRODUCTION

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, as in the case of an income statement. It provides an overview of 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. Financial statement Analysis is a judgmental process which aims to estimate current and past
financial Positions and the results of the operation of an enterprise, with primary objective of Determining the
best possible estimates and predictions about the future conditions. It Essentially involves regrouping and
analysis of information provided by financial Statements to establish relationships and throw light on the
points of strengths and Weaknesses of a business enterprise, which can be useful in decision-making involving
Comparison with other firms (cross sectional analysis) and with firms’ own Performance, over a time period
(time series analysis).

A complete set of financial statements is made up of five components:

• An Income Statement,

• A Statement of Changes in Equity,

• A Balance Sheet,

• A Statement of Cash Flows, and

• Notes to Financial Statement

1
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FIGURE.1

2
 1.2 INDUSTRY PROFILE

FINANCIAL SERVICES INDUSTRY

What is the financial services industry?

We can group financial services companies into the following sectors:

• Stock brokerages

• Asset management firms

• Accounting firms

• Payment apps

• Mortgage lenders

• Private equity

• Venture capital
• Traditional banks

• Online banks

• Credit unions

• Insurance carriers

• Credit card issuers

• Credit card processors

• Financial planners / advisors

3
The financial services industry includes both traditional institutions with long histories, as well as new fintech
startups that are trying to disrupt the market.

Due to the rapid proliferation of powerful technology (smartphones, mobile apps, risk decisioning analytics,
etc.) over the past 15 years, the industry is undergoing massive change.

Legacy institutions that have resisted change for decades must now figure out ways to meet evolving customer
expectations. Otherwise, they risk being overtaken by more agile competitors.

Financial services industry overview

At a high level, the financial services industry can be broken down into the following categories:
personal/consumer and corporate.

Some companies, such as banks, cover both categories. Others, like the AI-driven personal finance budgeting
app Cleo, target one specific category.

4
 1.3 COMPANY PROFILE

IIFL Securities Limited provides capital market services in the primary and secondary markets in India. The
company operates through Capital Market Activity, Insurance Broking, facilities and ancillary, and Others
segments. It offers retail broking products and services comprising equity, commodities, and currency
broking; financial planning, depository participant, mutual funds and bonds, portfolio management, alternate
investment funds, and retirement and estate planning services; broking, corporate access, and research support
services; investment banking services consisting of initial public offerings, qualified institutional placement,
right issues, preferential placement, follow-on public offer, mergers and acquisitions, share buybacks, tender
offers, and delisting services; and advisory services for private equity placements and mergers and
acquisitions. The company also distributes third-party financial products, such as mutual funds, insurance,
portfolio management services, alternate investment funds, fixed deposits, loans, bonds, and pension products.
It serves retail and mass affluent investors, domestic and foreign institutional investors, sovereign wealth
funds, foreign portfolio investors, mutual funds, insurance companies, banks, pension funds, alternate
investment funds, banks, and private equity funds and corporates. The company was formerly known as India
Infoline Limited and changed its name to IIFL Securities Limited in February 2018. IIFL Securities Limited
was incorporated in 1996 and is based in Mumbai, India.

History

IIFL was founded on 18 October 1995, by Nirmal Jain, a 1986 graduate from University of Mumbai and an
alumnus of Indian Institute of Management, Ahmedabad. Jain is among the few successful entrepreneurs post
the economic liberalization era in India ushered by PV Narasimha Rao. Jain was previously employed with
Hindustan Unilever Limited. The company was founded as Probity Research and Services Private Limited
which provided research on the Indian economy, businesses and corporates. The name was later changed to
India Infoline Limited.

5
A few years into the business, the organization found itself with clients which Included research organizations,
banks and corporates. They then began launching their research products to become more noticeable in the
market. In the meanwhile, the dotcom revolution was beginning to take place in India. The website was created
in 1999.

Taking the business one step ahead this group of consultants opened a trading portal – 5paisa –in 2000 thus
moved into the business of being a full-service broking agency. During this time they widened their
distribution network.

6
 1.4 REVIEW OF LITERATURE

1. Vijay Kumar. V, Mavaluri Pradeep and Boppana Nagarjuna (2015) in their study concluded that financial
ratios are divided into five basic categories, which are: liquidity, activity, debt, profitability, and market
ratios. The ratios give valuable insight into the health of a firm, the financial condition and profitability.
2. Ross et al., (2017) proved that most researchers divide the financial ratios into four group’s i.e.,
profitability, solvency, liquidity, and activity ratios.
3. Ghosh Santanu Kumar and Mondal Amitava (2018) in their study concluded that the Measurement of
financial performance used in the analysis were return on equity, Return on assets and assets turnover
ratio of Indian Banks.
4. Robert O.Edmister (2020) in his study “An Empirical Test of Financial Ratio analysis For Small Business
Failure” developed and empirically tested a number of methods for Analysing financial ratios to predict
the failure of small business.
5. Brigham and Ehrhardt (2019) stated that the “financial ratios are designed to help Evaluate financial
statements”. Financial ratios are used as a planning and control tool. Financial ratio analysis is used to
evaluate the performance of an organization.
6. Virambhai (2020) concluded that the company/management should try to increase the production,
minimize the cost and operating expenses, exercise proper control on Liquidity position, reduction of
power, fuel, borrowing funds, overheads, interest Burden, etc.
7. Prasanta Paul (2021) in his study “Financial Performance Evaluation – Different type of statistical tools”
stated that tools like standard deviation, arithmetic mean, Correlation etc. are used extensively.
8. According to Anthony (2017), Financial Statements, Essentially, are interim reports, presented annually
and reflect a division of life of an enterprise into arbitrary accounting period more frequently in a year
9. According to Barth, Beaver and Landsman (2019) concluded in their study that the value relevance
literature provides fruitful insights for standard setting process.
10. Holthousen and Watts (2018) in their study pointed out that value relevance research offers little or no
insight for standard setting.
11. According to Barne, (2019) States that Financial ratio are widely used to develop insights into the financial
performance of companies’ by both the evaluators’ and researchers’.

7
12. Mingyi Hung (2016) in his paper on “Accounting Standards and Value Relevance of Financial Statements:
An International Analysis” concluded that the use of accrual accounting (versus cash accounting)
negatively affects the value relevance of financial statements in countries with weak shareholder
protection.

8
 1.5 STATEMENT OF PROBLEM

➢ Financial statement only covers specific period in IIFL Securities Ltd.

➢ I have seen an opportunity to work with this subject.
➢ Financial statement is not adjusted For Inflation. This mostly applies to long term asset
Causes of Problems with Financial analysis:

• Lack of understanding of profit versus cash.

• Lack of cash management skills.
• Bad capital investments.
• Financial statement is derived from historical cost may change over a period of time

9
 1.6 OBJECTIVES OF STUDY

The main objectives of research study are as follows: -

➢ To study the existing financial position of the IIFL Securities Ltd.

➢ To identify the financial strengths and weakness of the IIFL Securities Ltd.

➢ To suggest suitable measures to improve the financial health of the IIFL Securities Ltd.

10
 1.7 SCOPE OF STUDY

This report is related with the study of current asset management and covers the data pertaining to the
past five year’s financial performance of the IIFL Securities Ltd. Financial performance includes financial
statements analysis. In this the researcher must study the past performance of the company.

1. The study is based on the previous five years data (2017-18 to 2022-23).
2. The study contains the Ratio Analysis with respect to IIFL Securities Ltd.
3. This study further compares the financial statement to know the relative financial position of the
Company.
4. Trend analysis also carried out to evaluate the trends in financial statement of the company.

11
 1.8 LIMITATION OF STUDY

Limitations for the study are as follows.

1. As the certain documents were confidential, it was not possible to collect all the information necessary for
the deep study.
2. The study is limited to 45 days. It is difficult to collect all the data with the short period of time.
3. A financial technique itself is a very wide subject, which particularly motivates to evaluate its
financial analysis with ordinary measures for capital organization.
4. The study is concerned only to The IIFL Securities Ltd.
5. It may be difficult to find out basis for comparisons.

12
 CHAPTER 2

2 RESEARCH METHODOLOGY

Research methodology is a way to systematically solve the research problem Research methodology may be
understood as a science of studying how research is done scientifically
The main objective of this study is the find out the financial position of the firm, and also, to find out whether
liquidity performance, growth, profitability and turnover position of the company.

2.1 RESEARCH DESIGN

Analytical research brings together subtle details to create more provable assumptions. Thus, analytical
research tells us why something is true. Researching why something happens is not cays.

13
 2.2 TOOLS FOR DATA COLLECTION

The report will be prepared mainly using secondary data. They are follows below

SECONDARY DATA
The secondary data are those which have already collected and stored. Secondary data can be easily acquired
from the records, annual reports of the company etc. It will save the time. money and efforts to collect the
data.

The major source of data for this project was collected through annual reports, Balance sheet of 5-year period
from 2018-2022 & some more information collected from internet and text sources.

STATISTICAL TOOLS

1. Ratio Analysis

2.Percentage Analysis

14
 CHAPTER 3

DATA ANALYSIS AND INTERPRETATION

CLASSIFICATIONS OF RATIOS:
Several ratios, calculated from the accounting data can be grouped into various classes according to financial
activity or function to be evaluated. Management is interested in evaluating every aspect of the firm’s
performance. They must protect the interests of all parties and see that the firm grows profitably. In view of
the requirement of the various users of ratios; ratios are classified into following four important categories:

A. LIQUIDITYRATIO:

a) Current Ratio

b) Quick Ratio or Acid Test Ratio

B. ACTIVITY RATIO OR TURNOVERRATIO:

a) Fixed Assets Turnover Ratio

b) Working Capital Turnover Ratio

C. PROFITABILITYRATIOOR INCOME RATIO:

Profitability Ratio based on Sales:

a. Gross Profit Ratio

b. Net Profit Ratio

c. Operating Ratio

Profitability Ratio Based on Investment:

a. Return on Total Shareholder’s Funds

15
 1. LIQUIDITYRATIO:
It is extremely essential for a firm to be able to meet the obligations as they become due. Liquidity ratios
measure the ability of the firm to meet its current obligations (liabilities). The liquidity ratios reflect the short-
term financial strength and solvency of a firm. In fact, analysis of liquidity needs the preparation of cash
budgets and cash and funds flow statements; but liquidity ratios, by establishing a relationship between cash
and other current assets to current obligations, provide a quick measure of liquidity.

A very high degree of liquidity is also bad; idle assets earn nothing. The firm’s funds will be unnecessarily
tied up in current assets. Therefore, it is necessary to strike a proper balance between high liquidity and lack
of liquidity. The most common ratios which indicate the extent of liquidity are lack of it, are:

a. Current ratio

b. Quick ratio.

16
 CURRENT RATIO:
The current ratio is a measure of firm’s short-term solvency. It indicates the availability of current assets in
rupees for every one rupee of current liability.
FORMULA

Current ratio is calculated by dividing current assets by current liabilities.

TABLE 3.1 CURRENT RATIO

YEAR CURRENT CURRENT CURRENT RATIO

ASSETS LIABILITY

2018 2061.13 1008.71 2.04

2019 1884.19 1292.23 1.46

2020 1735.96 1146.37 1.51

2021 2905.61 2349.03 1.24

2022 5539.10 4541.04 1.17

CHART 3.1 CURRENT RATIO

2.5

1.5

0.5

0
YEAR 2018 2019 2020 2021 2022

INTERPRETATION:

In the year of 2018 current ratio would be 2.04 and later it has been decreased from 1.46 in 2019 and 1.51 in
2020, in 2021 decreased to 1.24 and 2022 it has been decreased to 1.17.

17
 Quick Ratio:

Quick ratio also called Acid-test ratio, establishes a relationship between quick, or liquid, assets and current
liabilities. An asset is a liquid if it can be converted into cash immediately or reasonably soon without a loss
of value. Cash is the most liquid asset.

FORMULA:
Quick ratio is calculated by dividing liquid assets by current liabilities.

TABLE 3.2 QUICK RATIO

YEAR LIQUID CURRENT CURRENT RATIO

ASSETS LIABILITY

2018 2061.13 1008.71 2.04

2019 1884.19 1292.23 1.46

2020 1735.96 1146.37 1.51

2021 2905.61 2349.03 1.24

2022 5539.10 4541.04 1.17

CHART 3.2 QUICK RATIO

2.5

1.5

0.5

0
YEAR 2018 2019 2020 2021 2022

INTERPRETATION:

In the year of 2018 current ratio would be 2.04 and later it has been decreased from 1.46 in 2019 and 1.51 in
2020, in 2021 decreased to 1.24 and 2022 it has been decreased to 1.17.

18
 2. ACTIVITY RATIO OR TURNOVERRATIO
These ratios are calculated on the bases of „cost of sales‟ or sales, therefore, these ratios are also called as
“Turnover Ratio‟. Turnover indicates the speed or number of times the capital employed has been rotated in
the process of doing business. Higher turnover ratio indicates the better use of capital or resources and in turn
leads to higher profitability.

ACTIVITY RATIO OR TURNOVERRATIO:

a) Fixed Assets Turnover Ratio

b) Working Capital Turnover Ratio

19
 Fixed Assets Turnover Ratio:
This ratio reveals how efficiently the fixed assets are being utilized.

FORMULA
Fixed Assets Turnover ratio is calculated by dividing Net sales by Net Fixed Assets.

TABLE 3.3 FIXED ASSETS TUNOVER RATIO

YEAR NET SALES NET FIXED FIXED ASSETS

ASSETS TUNOVER RATIO

2018 708.42 20.55 34.47

2019 690.67 23.16 29.82

2020 597.11 87.57 6.81

2021 675.70 169.45 3.99

2022 1060.48 161.71 6.56

CHART 3.3 FIXED ASSETS TUNOVER RATIO

25

20

15

10

0
YEAR 2018 2019 2020 2021 2022

INTERPRETATION:

In the year of 2018 Fixed Assets Turnover ratio would be 34.47 and later it has been decreased from 29.82 in
2019 and 6.81 in 2020, in 2021 decreased to 3.99 and 2022 it has been increased to 6.56.

20
 Working Capital Turnover Ratio:
This ratio reveals how efficiently working capital has been utilized in making sales.

FORMULA
Working capital Turnover ratio is calculated by dividing total revenue by working capital.

TABLE 3.4 WORKING CAPITAL TURNOVER RATIO

YEAR TOTAL WORKING WORKING CAPITAL

REVENUE CAPITAL TURNOVER RATIO

2018 742.66 1052.42 0.70

2019 705.81 591.96 1.91

2020 643.78 589.59 1.09

2021 760.08 556.58 1.36

2022 1150.52 790.03 1.45

CHART 3.4 WORKING CAPITAL TURNOVER RATIO

2.5

1.5

0.5

0
YEAR 2018 2019 2020 2021 2022

INTERPRETATION:

In the year of 2018 working capital Turnover ratio would be 0.70 and later it has been increased from 1.91 in
2019 and 1.09 in 2020, in 2021 increased to 1.36 and 2022 it has been increased to 1.45.

21
 3. PROFITABILITYRATIOOR INCOME RATIO
The main object of every business concern is to earn profits. A business must be able to earn adequate profits
in relation to the risk and capital invested in it. The efficiency and the success of a business can be measured
with the help of profitability ratio.

Profitability Ratio based on Sales:

a. Gross Profit Ratio

b. Net Profit Ratio

c. Operating Ratio

Profitability Ratio Based on Investment:

a. Return on Total Shareholder’s Funds

22
 Gross Profit Ratio:
This ratio shows the relationship between gross profit & sales.

FORMULA
Gross profit ratio is calculated by dividing gross profit by net sales * 100.

TABLE 3.5 GROSS PROFIT RATIO

YEAR GROSS NET SALES GROSS PROFIT

PROFIT RATIO

2018 241.28 708.42 34.05%

2019 216.27 690.67 31.31%

2020 198.67 597.11 33.32%

2021 222.33 675.70 32.90%

2022 358.77 1060.48 33.38%

TABLE 3.5 GROSS PROFIT RATIO

40

35

30

25

20

15

10

0
YEAR 2018 2019 2020 2021 2022

INTERPRETATION:

In the year of 2018 gross profit ratio would be 34.05% and later it has been decreased from 31.31% in 2019
and 33.32% in 2020, in 2021 decreased to 32.90% and 2022 it has been increased to 33.38%.

23
 Net Profit Ratio:
This ratio shows the relationship between net profit and sales.

FORMULA
Net profit ratio is calculated by dividing net profit by Net sales*100.

TABLE 3.6 NET PROFIT RATIO

YEAR NET PROFIT NET SALES NET PROFIT RATIO

2018 157.51 708.42 22.23%

2019 144.94 690.67 20.98%

2020 142.62 597.11 23.92%

2021 172.84 675.70 22.82%

2022 284.11 1060.48 26.79%

CHART 3.6 NET PROFIT RATIO

30

25

20

15

10

0
YEAR 2018 2019 2020 2021 2022

INTERPRETATION:
In the year of 2018 net profit ratio would be 22.23% and later it has been decreased from 20.98% in 2019 and
23.92% in 2020, in 2021 decreased to 22.82% and 2022 it has been increased to 26.79%.

24
 Operating Ratio:
This ratio measures the proportion of an enterprise cost of sales and operating expenses in comparison to its
sales.

FORMULA
operating ratio is calculated by dividing cost of goods sold + operating Expenses by Net sales *100.

TABLE 3.7 OPERATING RATIO

YEAR CGS + NET SALES OPERATING RATIO

OPERATING
EXPENSES

2018 118.90 708.42 17.24%

2019 109.24 690.67 16.21%

2020 89.26 597.11 14.62%

2021 121.61 675.70 18.35%

2022 211.59 1060.48 20.31%

CHART 3.7 OPERATING RATIO

25

20

15

10

0
YEAR 2018 2019 2020 2021 2022

INTERPRETATION:
In the year of 2018 operating ratio would be 17.24% and later it has been decreased from 16.21% in 2019 and
14.62% in 2020, in 2021 increased to 18.35% and 2022 it has been increased to 20.31%.

25
 Return on Total Shareholder’s Funds:
For calculating this ratio, Net Profit after Interest and Tax’ is divided by total.

FORMULA
Return on Total Shareholder’s Funds ratio is calculated by dividing net profit (after interest & tax) by
Shareholder’s Funds *100.

TABLE 3.8 RETURN ON TOTAL SHAREHOLDER’S FUNDS

YEAR NET PROFIT SHAREHOLDER’S RETURN ON

(AFTER INTEREST FUNDS TOTAL
& TAX) SHAREHOLDER’S
FUNDS

2018 157.51 565.24 27.86%

2019 144.94 644.68 22.48%

2020 142.62 716.80 19.89%

2021 172.84 757.39 22.28%

2022 284.11 949.21 29.93%

CHART 3.8 RETURN ON TOTAL SHAREHOLDER’S FUNDS

35
30
25
20
15
10
5
0
YEAR 2018 2019 2020 2021 2022

INTERPRETATION:
In the year of 2018 Return On total Shareholder’s Fund would be 27.86% and later it has been decreased from
22.48% in 2019 and 19.89% in 2020, in 2021 increased to 22.28% and 2022 it has been increased to 29.93%.

26
 TREND ANALYSIS

TABLE 3.9 TREND ANALYSIS

Y 2 2 2 2 2 2 2 2 2 2
E 0 0 0 0 0 0 0 0 0 0
A 1 1 2 2 2 2 2 2 2 2
R 8 9 0 1 2 3 4 5 6 7

P 1 1 1 1 2 2 2 3 3 3
R 5 4 4 7 8 6 9 2 4 7
O 7 4 2 2 4 4 2 0 9 7
F . . . . . . . . . .
I 5 9 6 8 1 7 8 9 0 1
T 1 4 2 4 1 3 4 5 6 7

CHART 3.9 TREND ANALYSIS

400

350

300

250

200

150

100

50

0
YEAR 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

INTERPRETATION:

In the above table it predicts the next 5 years profit of the IIFL Securities limited. In the year 2023 profit is
264.73 and later it has been increased from 292.84 in 2024 and 320.95 in 2025, in 2026 increased to 349.06
and 2027 it has been increased to 377.17.

27
 CHAPTER-4
4.1 SUMMARY OF FINDINGS

➢ The current asset of the company, In 2017-2018 2061.13, In 2018-2019 decreases to 1884.19, In
2019-2020 decreases 1735.96, In 2020-2021 increases 2905.61, In 2021-2022 increases 5331.07.

➢ The current liabilities of the company, In 2017-2018 1008.71, In 2018-2019 increases to 1292.23,
In 2019-2020 increases 1146.37, In 2020-2021 increases 2349.03, In 2021-2022 increases 4541.04.

➢ The current ratio of the company, In the year of 2018 current ratio would be 2.04 and later it has
been decreased from 1.46 in 2019 and 1.51 in 2020, in 2021 decreased to 1.24 and 2022 it has been
decreased to 1.17.

➢ The Fixed Assets of the company, In the year of 2018 Fixed Assets Turnover ratio would be 34.47
and later it has been decreased from 29.82 in 2019 and 6.81 in 2020, in 2021 decreased to 3.99 and
2022 it has been increased to 6.56.

➢ The working capital Turnover ratio of the company, In the year of 2018 working capital Turnover
ratio would be 0.70 and later it has been increased from 1.91 in 2019 and 1.09 in 2020, in 2021
increased to 1.36 and 2022 it has been increased to 1.45.

➢ The Gross profit of the company, In the year of 2018 gross profit ratio would be 34.05% and later it
has been decreased from 31.31% in 2019 and 33.32% in 2020, in 2021 decreased to 32.90% and
2022 it has been increased to 33.38%.

➢ The net profit of the company, In the year of 2018 net profit ratio would be 22.23% and later it has
been decreased from 20.98% in 2019 and 23.92% in 2020, in 2021 decreased to 22.82% and 2022
it has been increased to 26.79%.

➢ The operating ratio of the company, In the year of 2018 operating ratio would be 17.24% and later
it has been decreased from 16.21% in 2019 and 14.62% in 2020, in 2021 increased to 18.35% and
2022 it has been increased to 20.31%.

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 4.2 SUGGESTIONS AND RECOMMENDATIONS

➢ The company should improve its current assets and current liabilities in order to overcome its
negative impact. It must make its working capital stable to further continue in the market.

➢ Company must maintain its current financial position of working capital as liquidity ratios turning
satisfactory.

➢ Working capital shows negative impact and decreases year by year. It is not good for the company.
So, in order to increase the working capital turnover, the company needs to increase its sales.

➢ The Profit of the company is very good and increasing year by year and it helps the growth of the
organization and it maintains the same that shows the efficient of the company.

➢ The company is utilizing the fixed assets, which major help to the growth of the organization. The
company should maintain that perfectly.

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 4.3 CONCLUSION

➢ The study conducted on Ratio analysis at “IIFL Securities Ltd ,” gives a view of assessing the
performance of overall company by analyzing the financial data with the help of schedule of changes
in working capital, Fixed Assets, profitability and etc..

➢ We can conclude that the company’s profitability has increased over the years. The Ratios of the
company are satisfactory and the company enjoys a balance of liquidity and profitability. Based on
the analysis, we can further conclude that the overall management and overall performance is sound.

➢ The company’s overall position is at a good position. Particularly the current year’s position is well
due to raise in the profit level from the last year position. It is better for the organization to diversify
the funds to different sectors in the present market scenario.

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 BIBLIOGRAPHY
Books
1. Financial Management, Theory and Practice 10th Edition by Prasanna Chandra.
2. Financial Management for CA Intermediate by Institute of Chartered Accountants of India.
3. Financial Analysis & Control for M.Com by Nirali Prakashan.
4.Ratio analysis Fundamental by Axel Tracy
5. Analyzing Financial Performance by Nic La Rosa
6. Financial Statements Analysis Cases from Corporate India by SANDEEP GOEL
7. Financial Ratios & Financial Statement Analysis by Raiyani Jagadish R

Websites
1. https://www.iiflsecurities.com
2. https://en.wikipedia.org/wiki/India_Infoline

3. www.moneycontrol.com
4. https://www.moneycontrol.com/financials/iiflsecuritieslimited/balance-sheetVI/IIFLS54277

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 ANNEXURE
BALANCE SHEET FOR THE YEAR 2018-2022

BALANCE SHEET OF IIFL MAR 22 MAR 21 MAR 20 MAR 19 MAR 18

SECURITIES LIMITED (in Rs.Cr.)

EQUITIES AND LIABILITIES

SHAREHOLDER'S FUNDS
Equity Share Capital 60.79 60.59 63.92 63.84 63.80
TOTAL SHARE CAPITAL 60.79 60.59 63.92 63.84 63.80
Reserves and Surplus 880.29 692.15 649.99 578.65 501.44
TOTAL RESERVES AND 880.29 692.15 649.99 578.65 501.44
SURPLUS
TOTAL SHAREHOLDERS 949.21 757.39 716.80 644.68 565.24
FUNDS
NON-CURRENT LIABILITIES
Long Term Borrowings 0.00 0.00 0.00 0.00 537.59
Deferred Tax Liabilities [Net] 0.00 0.00 0.00 0.00 0.00
Other Long Term Liabilities 43.07 7.81 18.62 21.75 21.15
Long Term Provisions 5.78 4.39 3.27 2.45 2.11
TOTAL NON-CURRENT 48.85 12.19 21.89 24.20 560.85
LIABILITIES
CURRENT LIABILITIES
Short Term Borrowings 336.29 89.00 75.64 100.54 0.00
Trade Payables 83.95 35.56 30.09 18.71 26.92
Other Current Liabilities 4,120.80 2,224.48 1,040.64 1,172.98 981.79
Short Term Provisions 0.00 0.00 0.00 0.00 0.00
TOTAL CURRENT 4,541.04 2,349.03 1,146.37 1,292.23 1,008.71
LIABILITIES
TOTAL CAPITAL AND 5,539.10 3,118.61 1,885.06 1,961.10 2,134.80
LIABILITIES

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ASSETS
NON-CURRENT ASSETS
Tangible Assets 67.74 11.34 83.03 19.05 14.83
Intangible Assets 92.86 156.20 1.98 3.59 5.27
Capital Work-In-Progress 1.10 1.91 2.56 0.52 0.44
Other Assets 0.00 0.00 0.00 0.00 0.00
FIXED ASSETS 161.71 169.45 87.57 23.16 20.55
Non-Current Investments 0.00 0.00 0.00 0.00 0.00
Deferred Tax Assets [Net] 17.43 17.24 15.10 38.66 39.17
Long Term Loans And Advances 0.00 0.00 0.00 0.00 0.00
Other Non-Current Assets 28.89 26.31 46.43 15.10 13.94
TOTAL NON-CURRENT 208.02 213.00 149.10 76.92 73.67
ASSETS
CURRENT ASSETS
Current Investments 157.42 95.02 247.36 189.16 187.13
Inventories 0.00 0.00 0.00 0.00 0.00
Trade Receivables 33.05 36.64 20.05 11.29 14.80
Cash And Cash Equivalents 3,691.44 1,653.05 993.22 980.59 727.06
Short Term Loans And Advances 488.42 147.84 22.04 92.06 78.20
OtherCurrentAssets 960.75 973.07 453.29 611.10 1,053.94
TOTAL CURRENT ASSETS 5,331.07 2,905.61 1,735.96 1,884.19 2,061.13
TOTAL ASSETS 5,539.10 3,118.61 1,885.06 1,961.10 2,134.80

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PROFIT AND LOSS A/C FOR THE YEAR 2018-2022
PROFIT & LOSS ACCOUNT OF IIFL MAR MAR MAR MAR MAR
SECURITIES LIMITED (in Rs. Cr.) 22 21 20 19 18
INCOME
REVENUE FROM OPERATIONS 1,060.48 675.70 596.11 690.67 708.42
[GROSS]
Less: Excise/Sevice Tax/Other Levies 0.00 0.00 0.00 0.00 0.00
REVENUE FROM OPERATIONS 1,060.48 675.70 596.11 690.67 708.42
[NET]
TOTAL OPERATING REVENUES 1,060.48 675.70 596.11 690.67 708.42
Other Income 90.04 84.38 47.64 15.13 34.24
TOTAL REVENUE 1,150.52 760.08 643.74 705.81 742.66
EXPENSES
Cost Of Materials Consumed 0.00 0.00 0.00 0.00 0.00
Purchase Of Stock-In Trade 0.00 0.00 0.00 0.00 0.00
Operating And Direct Expenses 211.59 121.61 89.26 109.24 118.90
Changes In Inventories Of FG,WIP And 0.00 0.00 0.00 0.00 0.00
Stock-In Trade
Employee Benefit Expenses 296.38 195.49 192.27 213.44 181.11
Finance Costs 34.34 19.11 31.22 50.86 37.18
Depreciation And Amortisation Expenses 64.31 44.29 48.06 11.63 10.73
Other Expenses 185.13 157.25 84.27 104.35 153.47
TOTAL EXPENSES 791.75 537.75 445.07 489.53 501.38
PROFIT/LOSS BEFORE 358.77 222.33 198.67 216.27 241.28
EXCEPTIONAL, EXTRAORDINARY
ITEMS AND TAX
Exceptional Items 0.00 0.00 0.00 0.00 0.00
PROFIT/LOSS BEFORE TAX 358.77 222.33 198.67 216.27 241.28
TAX EXPENSES-CONTINUED
OPERATIONS
Current Tax 76.13 51.19 31.75 71.30 93.06
Less: MAT Credit Entitlement 0.00 0.00 0.00 0.00 0.00
Deferred Tax -0.10 -2.35 24.12 0.09 -12.27
Tax For Earlier Years -1.37 0.65 0.18 -0.05 2.98
TOTAL TAX EXPENSES 74.66 49.49 56.05 71.33 83.77
PROFIT/LOSS AFTER TAX AND 284.11 172.84 142.62 144.94 157.51
BEFORE EXTRAORDINARY ITEMS
PROFIT/LOSS FROM CONTINUING 284.11 172.84 142.62 144.94 157.51
OPERATIONS
PROFIT/LOSS FOR THE PERIOD 284.11 172.84 142.62 144.94 157.51

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