Growth Ratio Summary

Growth Score : 6.00

Reliance Communications shows a mixed growth performance. While the company has experienced significant declines in revenue and asset growth, it demonstrates positive growth in earnings per share and net income. While the positive trends in earnings are encouraging, the company needs to address the negative revenue and asset growth to ensure sustainable long-term growth.

Financial Ratio Summary

Financial Score : 3.20

Reliance Communications faces challenges in its financial metrics. The negative adjusted earnings per share and cash earnings per share, along with a negative book value per share, indicate profitability and asset-related issues. While the company has made significant capital expenditures, these investments have not yet translated into improved financial performance. Reliance Communications needs to enhance its earnings and asset management to achieve financial stability.

Profitability Ratio Summary

Profitability Score : 4.00

Reliance Communications faces significant profitability challenges. The negative gross profit margin, return on equity, return on assets, operating margin, and net margin indicate that the company is struggling to generate profits from its operations. While the company has a good return on capital employed, this is not enough to offset the other negative profitability metrics. Reliance Communications needs to implement strategies to improve its profitability and overall financial health.

Efficiency Ratio Summary

Efficiency Score : 4.67

Reliance Communications showcases mixed efficiency. The high inventory turnover and low days sales in inventory point to efficient inventory management. However, the low fixed asset turnover, receivables turnover, high receivable days, and negative capital turnover indicate underutilization of assets and inefficient collection processes. While inventory management is a strength, improvements in fixed asset and capital turnover are needed to enhance overall operational efficiency.

Coverage Ratio Summary

Coverage Score : 2.00

The coverage ratios for Reliance Communications are concerning. The negative interest coverage ratio indicates that the company is not generating enough earnings to cover its interest expenses. Reliance Communication needs to improve its earnings and manage its debt obligations to ensure long-term financial health.

Solvency Ratio Summary

Solvency Score : 10.00

Reliance Communications demonstrates a strong solvency position. The negative debt ratios and high equity ratio suggest that the company relies more on equity than debt to finance its assets. While a solid equity base provides financial stability, the company should ensure it can effectively leverage debt when needed to maximize returns and optimize its capital structure for growth.

Liquidity Ratio Summary

Liquidity Score : 2.00

The liquidity position of Reliance Communications is a significant area of concern. The company's current and quick ratios indicate a limited ability to meet short-term obligations with its current assets. While maintaining adequate liquidity is crucial for operational stability, the consistently low cash flow ratios further exacerbate these concerns, potentially affecting the company's ability to invest in growth opportunities or handle unforeseen financial challenges.