“To Study the financial position of steel authority of India Limited by using ratio analysis technique”

Abstract

The Steel Authority of India Ltd. is one of the seven Maharatana companies and the leading steel producer in India. It has its plants and sub-units situated all across the country with major presence in the eastern and central regions of the country. The company is eminently the largest producer of iron ore and it has the second largest mines network in the country. This research study is based on secondary data. Ratio analysis technique was used by considering last five years annual reports. The purpose of this research paper was to find out the financial condition of the company, compare the historical performance and current financial condition of the company. The methodology adopted for the study was Ratio analysis and cash flow statement of the company. The trend of these ratios over time is studied to check whether they are improving or deteriorating. Usually, a high inventory (stock) turnover indicates efficient management of inventory because more frequently the stocks are sold, the lesser amount of money is required to finance the inventory. The goal is to have a working capital ratio higher than zero. A negative working capital ratio means a company, if it had to pay off all its creditors today, could not do so. The Company paid interim dividend @ 17.5% of the paid-up equity share capital during the year. Company can increase their current assets or try to reduce current liabilities like loan up to 1 year. Company can utilize its raw materials effectively and efficiently.