RATIO ANALYSIS PROJECT
"Compare the financial performance of two or more companies from the same industry
using ratio analysis over the last two years. Analyze key ratios in liquidity, profitability,
solvency, and efficiency, and provide insights on which company is performing better."
Guidelines:
1. Company Selection:
o Choose two or more companies from the same industry with publicly
available financial data .
o Ensure that the companies are comparable in terms of size and
operations.
2. Report Structure:
o Introduction: Provide an overview of the companies selected, including
industry background and a brief financial snapshot.
o Problem Statement: State the problem that you have identified amongst
the companies
o Ratio Calculations: For each company, calculate the following ratios for
the last two years:
Liquidity Ratios: Current Ratio, Quick Ratio
Profitability Ratios: Net Profit Margin, Return on Assets (ROA),
Return on Equity (ROE)
Solvency Ratios: Debt to Equity Ratio, Interest Coverage Ratio
Efficiency Ratios: Asset Turnover Ratio, Inventory Turnover Ratio
o Comparison and Analysis: Compare the calculated ratios between the
companies and analyze which company performs better in each category.
o Conclusion: Provide an overall assessment of which company is in a
stronger financial position based on the ratio analysis.
3. Formatting:
o The report should be 5-7 pages long, excluding cover page and
references.
o Use Times New Roman, font size 12, and 1.5 line spacing.
o Include tables or charts to clearly display ratio comparisons.
o Cite all sources of financial data and references in APA format.
4. Submission:
o Submit the project in PDF format via the ERP portal by 5th October.
o Ensure that the project is original and free from plagiarism.
5. Evaluation Criteria (Total 5 Marks):
o Correctness of ratio calculations (2 marks)
o Quality of comparative analysis (2 marks)
o Presentation and formatting (1 mark)
This comparative ratio analysis will help you understand how financial performance
differs between companies in the same industry.