Financial analysis of nishat textile mills

nishat mills annual report 2014

In Infront Analytics, financial ratios are categorized according to the financial aspect of the business that the ratio measures: - Growth ratios measure the company's rate of growth and assess the potential for future growth. Even if the ratio is favorable, the firm may be in financial trouble, because of more stock and work in process which is not easily convertible into cash, and, therefore firm may have less cash to pay off current liabilities.

nishat mills ratio analysis 2018

Decelerated business volumes, along with the electricity shortage crises have taken its toll and many small and medium size production houses have shut down already or at the verge of closure. Thus, the competition is expected to get even stiffer in the next fiscal year. The company sales and profitability showing increasing trend but as the assets increases the company not increases its sales by the same rate.

Nishat mills limited annual report 2018

Thus, the competition is expected to get even stiffer in the next fiscal year. The sales have increased by This is because of the reason that current ratio measures the quantity of the current assets and not the quality of the current assets. Domestic textile units gained as well as lost in all these volatilities as per their strengths and relative positioning in the market. The operating cycle of company is become longer than last year from days to days. Retrieved June 12, , from Brecorder. However, diminution in value of rupee against dollar and ample cotton stocks resulted in good results during the earlier part of the year Capital structure ratios include debt to equity and debt to asset ratios, and liquidity ratios include coverage ratios and solvency ratios. Nishat survived well due to its long and rich history of expertise, vertical integration and minimum dependency on other manufacturing entities. For textile sector in Pakistan, the year was also one of the most volatile due to a number of reasons. Limitations of Current Ratio: This ratio is measure of liquidity and should be used very carefully because it suffers from many limitations. It is crude ratio because it measure only the quantity and not the quality of the current assets. For this purpose, NML has developed a separate production line with highly skilled and trained work force to efficiently cater the high expectations of its up-market clientele.

Moreover, some potential growth with more US based clients is expected in near future as US market is expected to revive rapidly in days to come. However, diminution in value of rupee against dollar and ample cotton stocks resulted in good results during the earlier part of the year Capital structure ratios include debt to equity and debt to asset ratios, and liquidity ratios include coverage ratios and solvency ratios.

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Nishat Mills Ltd (NISM) Financial Ratios