Financial Analysis

10736 WordsMar 2, 201243 Pages
Chapter 1 Introduction & Methodology 1: Introduction NATIONAL TUBES LIMITED has been our selected company, which is the one of the leading steel pipe production company in Bangladesh. National Tubes Ltd. is in this business since 1964, it was nationalized in 1972. National Tubes mainly produces 2 types of steel pipes, 1) GI pipes for water supply & irrigation, 2) API pipes for transmission & distribution of gas & oil. Regarding the performance, actual production of pipes are 11% higher the set target of the year of last year 2007-08, especially higher production of API pipes facilitates to meet the target. National Tubes also achieved 2007-08 year’s profit target, which is around 39% higher than the set target of the company. Overall, it is a company with vision of maximizing shareholders’ wealth and its investors have already shown their confidence in the company. Its share price has increased over the years compared to its book value. Furthermore, it enjoys a positive signaling effect from the market and there is good news for National tubes. In this report, we will try to find out few reasons behind the good news and the positive signaling effect. The main company that we are performing financial analysis is on Aftab Motors LTD. Since our major focus is to compare two companies’ financial performances over time, so we have selected Atlas Bangladesh LTD as the rival company of Aftab Motors LTD. According to the project instruction, we aimed towards rationalizing stock price through financial statement analysis, and in doing so we have seriously dealt with the book value and market value of shares. By comparing the book value and the market value of Aftab Motors LTD from the year 2005-2009, we found out following information: 2: Objectives • Making a thorough analysis of the company’s financial statements over the last 5 years through

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