Cherat Cement Company - Cherat Cement Analysis of trend of business of Cherat Cement company Research Report Submitted by Anas Ayaz(13615 Submitted to

Cherat Cement Company - Cherat Cement Analysis of trend of...

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Submitted by: Anas Ayaz (13615) Submitted to: Sir Maqbool ur Rehman Cherat Cement Analysis of trend of business of Cherat Cement company Research Report
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Table of Contents Preface ......................................................................................................................................................... 3 Executive Summary ..................................................................................................................................... 4 Industry ....................................................................................................................................................... 6 Importance .................................................................................................................................................. 6 Industry Review ........................................................................................................................................... 6 Company ..................................................................................................................................................... 8 General information and Market Share ....................................................................................................... 8 FUTURE PROSPECTS ..................................................................................................................................... 9 SWOT ANALYSIS ......................................................................................................................................... 10 STRENGTHS ............................................................................................................................................ 10 OPPORTUNITIES ..................................................................................................................................... 10 WEAKNESSES ......................................................................................................................................... 10 THREATS ................................................................................................................................................. 10 PEST analysis .............................................................................................................................................. 10 Political factors ...................................................................................................................................... 11 Tax Policies ......................................................................................................................................... 11 Economic ............................................................................................................................................... 11 Inflation rate ...................................................................................................................................... 12 Interest rates ...................................................................................................................................... 12 Exchange rates ....................................................................................................................................... 12 SOCIAL ................................................................................................................................................... 12 Social factors ...................................................................................................................................... 12 Technological factors ............................................................................................................................. 13 Automation ........................................................................................................................................ 13 Technology incentives ........................................................................................................................ 13 Profit and Loss Statement - Common Size - Horizontal .............................................................................. 14 Profit and Loss Statement - Common Size - Vertical .................................................................................. 14 Balance Sheet - Common Size - Horizontal ................................................................................................ 15 Balance Sheet - Common Size - Vertical ..................................................................................................... 17
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Horizontal Analysis .................................................................................................................................... 19 Balance Sheet ........................................................................................................................................ 19 Vertical Analysis ......................................................................................................................................... 19 Balance Sheet ........................................................................................................................................ 19 Profit and Loss statement .......................................................................................................................... 20 Horizontal .............................................................................................................................................. 20 Vertical ................................................................................................................................................... 20 Liquidity ............................................................................................................................................. 22 Efficiency ............................................................................................................................................ 22 Profitability ........................................................................................................................................ 23 Leverage and Coverage ...................................................................................................................... 24 Market Ratios .................................................................................................................................... 25 DuPont Analysis ......................................................................................................................................... 25 Conclusion ................................................................................................................................................. 26 Bibliography ............................................................................................................................................... 27
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Preface Cherat Cement Company limited is a part of Ghulam Farooq group of companies. The Group comprises of companies, which are ranked amongst the top companies in the cement and textile sector. The report consists of financial analysis of the company for the 10 years starting from 2005 till 2014. The report analysis the trend of business inside Cherat Cement; it examines the Cherat Cement’s financial data and the environment surrounding the analyzed years that led to that data. The report examines the factors that were the reason for Cherat Cement’s profitability and efficiency during the early period of the analyzed data, and also the reasons that caused negative profitability to it during the latter years. I would like to thank Sir Maqbool ur Rehman for providing me the opportunity to prepare this analytical report which greatly helped me to understand the underlying reasons behind financial figures. I am also grateful to you for your utmost guidance and support throughout the semester. Anas Ayaz 13615 0323-2342950
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Executive Summary Cement industry is indeed a highly important segment of industrial sector that plays a pivotal role in the socio-economic development. The cement sector is contributing above Rs 30 billion to the national exchequer in the form of taxes. Cement industry is also serving the nation by providing job opportunities and presently more than 150,000 persons are eCheratoyed directly or indirectly by the industry. Cherat Cement is a part of Ghulam Farooq group of companies. The Group comprises of companies, which are ranked amongst the top companies in the cement and textile sector. Cherat cement is one of the pioneers of cement industry in Pakistan. The plants are located at Village Lakrai, District Nowshera, KPK province. Total annual clinker capacity of the Company is recorded at 1,000,000 tons. The Company supplies its products in local market and exports as well in African, Gulf, and other Asian Countries. Presently Cherat Cement due to its unique marketing efforts and superior quality has 8% market share for grey cement.
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