FINANCIAL PERFORMANCE OF SELECTED DURABLE COMPANIES IN INDIA
Abstract
Long-term investment in equity shares are the most opted form of investment by investors who takes risk to earn high returns. The investing decision like selecting a company and investing for long-term requires high knowledge, curiosity and analytical intelligence. Fundamental analysis and various other tools are the key methods in identifying and interpreting the risk involved. In this article equity share of selected 5 companies under consumer durable sector has been analysed. Five years consolidated balance sheet, profit and loss account, and cash flow statement of the selected companies are collected for this purpose. To start with, Ratio analysis is done on the variables from the financial information. 17 ratios categorised into Four ratios namely Profitability ratio, Leverage ratio, Valuation ratio and Operating ratio has been done. From the result obtained, on ratio analysis, PCA analysis has been carried out. PCA method was then used to provide the most acceptable ratios for better describing the companies' success. This analysis aimed to discuss and help stakeholders who observe the industries' financial performance efficiently. From 2017 to 2021, PCA examined 17 ratios of five Indian consumer durables companies. This study finds that there are eight main financial ratios in the consumer durable industry in India, which are classified as profitability ratio, P/E ratio, P/by ratio, Inventory turnover ratio, and Working capital turnover ratio as primary performance indicators for the industry, using the PCA analysis approach. Honeywell Automation Limited is clearly the best-performing company among the five corporations based on the data collected and analysis performed on them.
Keyword : Fundamental analysis, investment, risk, equity, ROI and ROCE.
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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