B-114 Manisha Soni

8/8/2019 B-114 Manisha Soni

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SUMMER PROJECT

COMPARATIVE STUDY :

FINANCIAL ANALYSIS OF EDELWEISS CAPITAL

LTD.WITH ITS COMPETITORS

SUBMITTED BY

MANISHA SONI

ROLL NO.114

1



FLOW OF THE PRESENTATION

Introduction to company Need for study

Objective of study

Research Methodology

Data Analysis

Findings and interpretation

Limitation

Future Scope

Recommendation

Conclusion

Bibliography

2



INTRODUCTION ABOUT EDELWEISS

A 1000 crore company started its business in 1995.

Mission - ³Ideas create, values protect´.

Its current businesses include:Investment Banking,

Securities Broking, and

Investment Management

Edelweiss also provides a wide range of services to:

Corporations,

Institutional Investors and

High Net-Worth Individuals 3





NEED FOR THE STUDY

To study the financial position of Edelweiss Capital Ltd. The

results obtained can help an investor decide whether investing

in Edelweiss is profitable or not.

To study how much competent is Edelweiss capital whencompared with its competitors

5



OBJECTIVES OF THE STUDY

To calculate and analyze financial ratios and statements.

To study the performance and trends of the company.

To benchmark the company¶s performance to their competitor¶s in order to assess a relative performance

measure.

To provide the investor with information as to where he/she

can get a best investment plan. (Selling the Trading andDemat Account and meeting sales targets )

6



RESEARCH METHODOLOGY

R esearch Design

Descriptive

Analytical

Data Collection Methods:

Internet

Discussions with seniors

Information obtained from the Team Leaders and the Branch

Manager at Edelweiss.

7



DATA ANALYSIS

8



ANALYSIS OF EDELWEISS CAPITAL LTD.

R atios 2007 2008 2009

Gross Profit Ratio 47.99 41.7 38.5

Operating Ratio 47.41 40.08 46.75

Net operating Profit Ratio 53.02 60.17 53.48

Net Profit Ratio 29.6 26.88 23.33

PROFITABILITYR ATIO

9



Gross Profit Ratio

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

50.00%

2007 2008 2009

47.99%

41.70%

38.50%

Gross Profit

10



Operating Ratio

36.00%

38.00%

40.00%

42.00%

44.00%

46.00%

48.00%

2007 2008 2009

47.41%

40.08%

46.75%

Operating Ratio

Operating Ratio

11



ANALYSIS OF EDELWEISS CAPITAL LTD

R atios 2007 2008 2009

Current Ratio 2.83 2.33 2.68

Proprietor Ratio 0.52 0.47 0.64

Capital Gearing Ratio 0.66 0.84 0.36

Debt Equity Ratio 0.49 0.64 0.48

Interest cover Ratio 10.33 3.22 3.44

FINANCIAL STABILITY R ATIOS

12



Current Ratio

0

0.5

1

1.5

2

2.5

3

2007 2008 2009

2.83

2.33

2.68

Current Ratio

Current Ratio

13



Proprietary Ratio

0

0.1

0.2

0.3

0.4

0.5

0.6

0.

200 2008 2009

0.520.4

0.64

Proprietary Ratio

Proprietary Ratio

14



Debt Equity Ratio

0

0.1

0.2

0.3

0.4

0.5

0.

0.7

2007 2008 2009

0.49

0. 4

0.48

Debt Equity Ratio

Debt Equity Ratio

15




R atios 2007 2008 2009

ROCE 28.9 25.89 12.94

ROPF 24.45 19.2 8.64

ROESC 24.45 19.2 8.64

EPS 24.44 36.12 30.52

Management Efficiency R atio

16



ROCE

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

2007 2008 2009

28.90%

25.89%

12.94%

Return on capital Employed

Return on capital

Employed

17



Earning Per Share

0

5

10

15

20

25

30

35

0

2007 2008 2009

2 . 5

36.12

30.52

EPS

EPS

18




R atios 2007 2008 2009

Debtors Turnover Ratio 7.85 9.21 8.13

Debtor Collection Period 46.5 39.7 44.9

Price Earning Ratio - 22.91 10.6

Dividend Payout Ratio - 5.53 12.06

Overall Efficiency R atio

19



Debtors Turnover Ratio

7

7.5

8

8.5

9

9.5

2007 2008 2009

7.85

9.21

8.13



20



Price Earning Ratio

0

22.91

10.6

0

5

10

15

20

25

2007 2008 2009

Price Earning Ratio

Price Earning Ratio

21



FINDINGS FOR EDELWEISS

The profitability ratios is not showing good trend from 2007 to2009,as profit has declined due to recession in 2008,but Edelweiss

capital is earning profits by its new ventures.

According to the financial stability ratios Edelweiss is

financially stable.

According to the Management Efficiency ratios, Edelweiss

displays a trend of reducing returns on investment From 2007 to

2009.

Taking into account all three years, Edelweiss has been efficient

with respect to certain overall efficiency ratios but hasn¶t been

up to the standards.22



ANALYSIS OF EDELWEISS WITH

MOTILAL OSWAL AND EMKAY

FINANCIAL

23



Profitability Ratio

R atios for 2009 Edelweiss

Capital

Motilal

Oswal

Emkay

Financial

Gross Profit Ratio 38.5 34.14 2.09

Operating Ratio 46.75 62.11 94.75

Net operating Profit Ratio 53.48 37.95 6.93

Net Profit Ratio 23.22 19.96 -4.6

24



Profitability Ratio

-10.00%

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%

80.00%

90.00%

100.00%

Gross Profit Ratio Operating Ratio Net Operating Profit

Ratio

Net Profit Ratio

Edelweiss

MotilalOswal

Emkay Financial

25



Financial Stability Ratio


Capital

Motilal

Oswal

Emkay

Financial

Current Ratio 2.68 1.8 2.03

Debt Equity Ratio 0.48 0.1 0.16

Interest cover Ratio 3.44 8.82 -0.16

26



Financial Stability Ratio

-1

0

1

2

3

4

5

6

7

8

9

10

Current Ratio Debt Equity Ratio Interest Cover Ratio

Edelweiss

MotilalOswal

Emkay Financial

27



Management Efficiency Ratio


Capital

Motilal

Oswal

Emkay

Financial

ROCE 12.94 18.96 -0.51

ROPF 8.64 12.33 -3.46

ROESC 8.64 12.33 -3.46

EPS 30.52 11.9 3.85

28



Management Efficiency Ratio

-5.00%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

ROCE ROPE

Edelweiss

MotilalOswal

Emkay Financial

29



Overall Efficieny Ratio


Capital

Motilal

Oswal

Emkay

Financial

Debtors Turnover Ratio 8.13 1.71 2.04

Price Earning Ratio 14 13.60 21.1

Dividend Payout Ratio 12.06 12.23 -

30



FINDINGS ABOUT COMPARISION

The Profitability ratio indicates Edelweiss is earning more profits as compared to other two companies.

The Financial Stability ratio indicates Edelweiss and Motilal

Oswal are more stable whereas Emkay Financial is not.

In case of Management efficiency ratio , Motilal Oswal has

better returns.

Edelweiss has been much efficient than Motilal Oswal and

Emkay Financial in most of the ratios.

31



WORK ING AT EDELWEISSBROK ING

32



Working at Edelweiss

Introduction about the company

Training

Generating Leads

Managing Leads

33



Product & Service offered at Edelweiss

Standard Plan

Subscription Plan

Corporate Account Plan

Tie Ups

34



Findings About Edelweiss Broking

ADB

Save on Service tax

Investor training

Offline Support

Baskets

35



LIMITATIONS

Due to time constraints comparative analysis is done only

with two firms Motilal Oswal and Emkay Financial

Services.

Due to lack of information in ± depth analysis is not done

with other companies.

36



SCOPE FOR FUTURE ENHANCEMENT

Comparative analysis with other competitors of Edelweiss like e.g.

Religare Securities Ltd., India Infoline etc can be done in the future.

The analysis with other investment banking firms will give Edelweiss

a better picture as to where it stands in comparison with its competitors

and could also provide suggestions for further development

37



RECOMMENDATIONS

Cutting down on expenses and repaying borrowed debts more

efficiently.

Decentralization of Operational Activities.

Edelweiss can introduce mutual funds and commodities on the

online portal.

The turnover limits offered can be increased to allow the

customers to trade more money which will in turn increase therevenue for the company.

Focus should be on providing better after sales service rather

than just on obtaining clients and achieving targets. 38



CONCLUSION

Edelweiss Capital Ltd. as a company has been successful since it

moved into retail in 2007 but later the company suffered a

setback as a result of reduction in profit.

Edelweiss Capital Ltd. may not have done well in recent times

but it still has a better position in the market when compared to

some of its competitors.

With a lot of new features on the online portal and the minimum brokerage rate of 1 paisa per share, Edelweiss Broking Ltd. has

been able to grab attention of the investors.

39



REFERENCES

www.edelcap.comwww.edelweiss.in

www.edelworld.com

http://www.edelcap.com/AboutUs/Default.aspx?ReportID=E9

ECFFB7-7D79-46E9-844E-33B0AEBA0BFD

http://www.motilaloswal.com/Reporting/

http://www.emkayglobal.com/APP_UI/frmInvestorRelations.a

spx

http://www.edelweiss.in/company/Emkay-Global-Financial-

Services-Ltd.html http://www.investopedia.com/terms/p/profitabilityratios.asp

40



THANK YOU

41

Documents

B-114 Manisha Soni