An Analytical Study of Profitability and Operating Ratio analysis of selected Chemical Companies in India

Ahmed Mahdi Abdulkareem¹, Dr. AlokKumar Chakrawal² & Kishankumar M.Rathod³¹PhD. Research Scholar, Department of Commerce, Saurashtra University, Rajkot, Gujarat – 360005, India
²Professor, Department of Commerce and Business Administration, Saurashtra University, Rajkot, Gujarat – 360005, India
³Assistant Professor, Satya Prakash College, Rajkot, Gujarat – 360002, India
DOI – http://doi.org/10.37502/IJSMR.2021.4805

Abstract

The main purpose of this study is to evaluate the profitability, financial performance, and operating position of selected chemical companies in addition to make suggestions for improvement in profitability or operating position of the selected companies. The present study is made for the period of five years from 2015-16 to 2019-20. Five companies were selection. Four ratios were used in this study: net profit ratio, gross profit ratio, material cost ratio, and factory overhead ratio. To test the hypothesis ANOVA was used. The major findings of this study indicate that there are no significant differences in various profitability ratios and operating ratios of selected chemical companies during the study period. Based on the data interpretation, the comparison of all the selected five chemical companies’ the ratios that have been concluded in this study indicate that Thirumalai Chemical Ltd. is in a better position than other selected chemical companies because its average of the selected ratio is 14.829 which is higher than the other selected chemical companies. So Thirumalai Chemical Ltd. is performing best among the selected chemical companies.

Keywords: Profitability, Financial, Operating ratio, Performance, and Improvement.

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