Report on Financial Statement Analysis Of Square Pharmaceuticals Limited

Abstract

This report is a pre-requisite of completion of the BBA Program. In this phase of my education I have received the practical knowledge related with the education I got. Additionally I have achieved commendable knowledge about the corporate finance industry. I am going to cover up the policies that Square Pharmaceuticals Ltd basically follows to run their business and going to analyze their financial statement and evaluate the performance. The report starts with an introduction part. In that part the objectives, scopes, methodology and limitations of the report have been discussed. After that, I have added a company overview. Here in the overview part, history, mission and vision of the company are briefly discussed also it contains a graphical presentation of Square Pharma from beginning till today. In the third part I have done the financial statement analysis which is the major part of this report. This part starts with the liquidity ratio where I have added current ratio, working capital ratio and cash conversion cycle. After that, asset management/efficiency ratio has been added. In this part, inventory turnover, total asset turnover and days sales outstanding ratios are done. In debt management part, debt ratio and times interest earned ratio is calculated. Finally in the ratio analysis part, comes the profitability ratio. Here, net profit margin, gross profit margin and operating margin are shown. Every result of the ratio analysis is followed by an interpretation of how that is representing the company’s financial status also each has a graphical representation as well. Ratio analysis part is followed by the calculation of return on equity and return on asset. After the ratio analysis part, fair value measurement is calculated in two ways. The dividend discount method, in this traditional method the current value of the stock is estimated on the basis of the spread between projected dividend growth and the discount rate. The second method which is used for fair value measurement is the model of equity. The model aims to calculate the intrinsic value of the shareholders equity of the firm. The next chapter contains the key findings from the statement analysis, recommendations and conclusion. The report ends with an appendix and the references added to it.