Ambika Cotton Mills Ltd

Growth Ratio Summary

Growth Score : 2.80

The growth ratios reveal significant challenges. Revenue, operating profit, earnings per share, and net income growth rates are all declining. However, asset growth remains positive, suggesting investments in assets are still occurring despite the downturn in other growth metrics. This mixed performance indicates underlying issues in sustainable growth.

Financial Ratio Summary

Financial Score : 7.40

The financial ratios indicate a generally positive financial standing. The company exhibits solid adjusted and cash earnings per share, along with a strong book value per share and dividend payout. However, high capital expenditures may indicate significant investments or potential inefficiencies. Overall, the company shows a healthy financial structure.

Profitability Ratio Summary

Profitability Score : 10.00

The company exhibits outstanding profitability across all key metrics. Excellent gross profit, return on capital employed, return on equity, return on assets, operating margin, and net margin all indicate strong and efficient operations. These high profitability ratios suggest the company is highly effective in generating profits from its investments and sales. Overall the profitability of the company is excellent.

Efficiency Ratio Summary

Efficiency Score : 5.00

The efficiency ratios present a mixed picture. Receivables management is excellent, but fixed asset, inventory and capital turnover are relatively low. While the company collects its receivables quickly, it struggles to efficiently convert its assets and inventory into sales. Improving asset and inventory management could enhance overall operational efficiency.

Coverage Ratio Summary

Coverage Score : 9.20

The company's coverage ratios are strong. The interest coverage ratio is high, indicating it can easily meet its interest obligations. The equity dividend coverage ratio is also solid, suggesting a comfortable capacity to cover dividend payments. These ratios reflect a robust ability to manage financial obligations.

Solvency Ratio Summary

Solvency Score : 10.00

The company exhibits outstanding solvency, with no debt on its balance sheet. This provides significant financial stability and flexibility. Not having debt reduces financial risk, but it might also indicate that the company is not leveraging debt to potentially enhance returns. A debt-free status is a strong indicator of financial health.

Liquidity Ratio Summary

Liquidity Score : 8.80

The company's liquidity position is generally strong. High current, quick, and cash ratios suggest it can comfortably meet its short-term obligations. However, a lower operating cash flow ratio indicates potential difficulties in generating cash from its operations. While current liquid assets are robust, the company might face challenges if operating cash flows do not improve.