Strategic alliances to gain global integration

Strategic alliances to gain global integration Introduction Multinational companies (MNCs) are defined as a firms with strong tangible and intangible assets, thus the capability to expand their business worldwide, with global diffusion as an important resource for competitive advantage (Bartlett and Ghoshal, 1998). In the stage of going global, most companies have to deal with the pressures of both global integration and/or local responsiveness, and some choose to form a strategic alliance with a partner to achieve global integration and/or local responsiveness more easily. Global integration and Local responsiveness Global Integration Global integration pressures are the forces that make MNCs exploit worldwide resources and integrate their activities on a global basis to realize economies of scale and achieve cost reduction. Bartlett and Ghoshal (1998) summarize that the motivation of Global Integration is the need of efficiency. More specifically, the developments of advanced technologies allow companies to expand manufacture globally and achieve economies of scale, resulting in the more standardized products. Moreover, the tastes of consumers have become homogeneous worldwide. Besides, MNCs tend to have global chess strategy, using the profit generated in one market to fund operations in another. Local Responsiveness In contrast, local responsiveness requires MNCs to make strategic decisions based on local context (Roth and Morrison, 1990). According to Bartlett and Ghoshal (1998) the drivers for local responsiveness are (i) the differences in consumer tastes in different countries; (ii) the typical characteristics of the product system in host countries; (iii) the administrative costs of coordinating manufacture on a global basis; (iv) the improvements in technologies enable companies to disperse manufacture to smaller local plants with low cost; (v) the trade and legislative barriers set by local Governments. Similarly, Hill (2001) discusses that the main pressures for local responsiveness are the differences in consumer tastes and preferences; differences in infrastructure and traditional practices; in distribution channels; and host government demands. Such pressures for local responsiveness urge multinational firms to adjust their products and services to better meet the demand of indigenous people. The Integration Responsiveness Framework The I-R framework, which is initially rationalized by Lawrence and Lorsch (1967) and later developed by Doz (1980), provides an insight into how MNCs compete internationally (Johnson and Julius, 1995). Bartlett and Ghoshal (1998), Spender and Grevesen (1999) mention the I-R framework to explain different ways MNCs respond to global integration and local responsiveness based on their strategy. As in Figure 1 below, MNCs pursuing a global strategy often emphasize on global integration and coordination. In contrast, multidomestic companies (called as multinational companies in Bartlett and Ghoshal model), with most pressures coming from customizing operation towards local context, focus on local responsiveness. International companies have an emphasis in knowledge transfer, because most of value they create is from transferring valuable resources to foreign markets. For transnational companies, facing equal pressures from both integration and responsiveness, they adopt a multifocal stra tegy aiming to achieve both cost efficiency and responsiveness. However the study of Bartlett and Ghoshal (1998) was restrained at internal organizational issues. Figure 1: How MNCs respond to Global integration, Local responsiveness and Worldwide learning based on their strategy (Bartlett and Goshal, 1998) Strategic Alliances There have been several researches on strategic alliances. Holmberg and Cummings (2009) contend that strategic alliances are becoming more and more important to every company in its strategic effort to maintain competitive advantages in the global marketplace. Strategic alliances are links between two or more companies to mutually carry out a specific project by coordinating necessary resources while still preserving their autonomy (Dussauge and Garette, 1999). Wheelen and Hunger (2000, p. 125) define a strategic alliance as a partnership between two or more companies to achieve strategically important targets that are mutually beneficial. According to Elmuti and Kathawala (2001), there are four main motivations for forming strategic alliances: (i) the growth strategies of parent companies to enter to a new market; (ii) the procurement of new technology or best quality or cheapest cost; (iii) the mitigation of financial risks; and (iv) the maintenance of competitive advantage for enterprises. Nowadays in a dynamic global environment, the role of strategic alliances is even more critical to the performance of a multinational company. Robson and Dunk (1999) have generalized the three main stages to develop an alliance including: Partner selection, Venture design and Venture management. The three key stages defined are similar to those by Hill (2001). Some typical features of strategic alliances are that their operations are subject to multiple decision making, continuous bargaining and conflicts of interests (Dussauge and Garette, 1999). Therefore it is not easy to successfully manage an alliance. Bleeke and Ernst (1993) find that among 49 alliances in their research, about 67% confront troubles within the first two years. Holmberg and Cummings (2009) give examples of failed strategic alliances, mostly due to lack of rigorousness in partner selection process. It is important to know if the way alliances can create value for the firm is appropriate to the parent firms strategy. So the first thing MNCs managers should consider from partner selection stage is to identify and verify that the way strategic alliances help to expand business is in line with the overall international operation strategy of parent firms. In this paper, the ways strategic alliances help multinational companies to achieve global integration and/or local responsiveness will be examined to assess their importance to the partner companies in relation to the partner companies strategy. Evaluating the ways strategic alliances allow multinational companies to achieve Global integration and Local responsiveness. There have been approaches to classify the ways that a strategic alliance cooperates to expand the business of parent companies. For example, Todeva and Knoke (2005) have listed 18 typical ways that strategic alliances can support multinational companies. This paper will approach the classification of Dussauge and Bernard (1999) because the systematized typology helps to provide a more comprehensive understanding on how strategic alliances allow MNCs to achieve integration and responsiveness. Alliances between non-competing companies International expansion joint ventures International expansion joint ventures (JVs) are established with a foreign partner aiming to penetrate into a new geographic market. One partner (the MNC) often seeks for market penetration, while the other (the local partner) has wide knowledge on local market thus can provide more easy market access. For example, in 1998, Yamaha Motor, the premier Japanese motorcycle manufacturer, together with Vietnam Forest Corporation, a state-owned corporation in forestry and Hong Leong Industries from Malaysia established a joint venture named Yamaha Motor Vietnam Ltd., providing motor cycles in Vietnam market (Yamaha Motor). The state-owned corporation has understanding about the market as well as necessary relations to the authority, combined with the expertise in manufacturing of Yamaha Motor, created a viable basis for the JV to thrive in Vietnam. This model is beneficial for both local government and the foreign MNC. For local government, equity sharing in JVs makes the MNCs more responsible and interested in the success of the JV. For the MNC, the local partner may provide the privilege access and political connections supporting effective market penetration. However this type of JV may result in the conflicts of benefits between the MNC and local partner. In many cases the JV is only one part of the total network of the MNC, so the MNC may have detrimental decision to the JVs performance. International expansion JV is rarely the first choice of MNCs managers since they prefer wholly owned subsidiary. However it is still common practice for MNCs when shifting business beyond borders (Dussauge and Bernard, 1999). International expansion JVs are common for MNCs facing great local responsiveness pressure (i.e. multidomestic and transnational companies), because it seeks solutions to overcome the legislative barrier and complexities of local market. In other words, it helps the MNCs to tailor their operation to fit local context. Vertical partnerships Vertical partnerships bring about cooperation opportunities for two companies at different successive stages of the production process. Normally, one partner may become a supplier or customer of the other. For example, Heinz, a global US food company is the supplier of many food products for ASDA in UK. That enables ASDA to fully deploy the resources of Heinz. However there are also shortcomings in this model. Since there is no bidding process, the opportunities to find the most cost-effective supplier are limited. As a result, the buyer tends to become dependent on the supplier. Although this model delivers mutual understanding, there are still potential conflicts of benefits (Dussauge and Bernard, 1999). Vertical partnerships relate to a strategic issue that MNC managers often deal with to increase efficiency: make or buy, or cooperate decision. MNCs choose to outsource when the cost to produce by their own is higher than the cost to outsource to a strategic partner. Consequently vertical partnerships are often exploited by MNCs facing high pressures from cost reduction (global and transnational companies). That model may help the MNC to maximize economies of scale and achieve global integration. Cross-industry agreements Cross-industry agreements are cooperation between two companies in different industries with a view to create a brand new business to diversify their operation, by taking advantage of the partners resources. For example, in 2001, Sony Corporation a Japanese electric equipment producer, and Telefonaktiebolaget LM Ericsson a provider of telecommunication equipment and services from Sweden established a 50:50 joint venture, Sony Ericsson. The JV has become a world-class mobile-phone manufacturer (Sony Ericsson). Nonetheless the drawback of cross-industry agreements is that they often post small profit margin, because most of the cases, the level of convergence of the two initial businesses is more moderate than expected. Besides, this model requires a high level of compatibility of the resources contributed by the two parties; and the new business developed must have a clear marketing strategy to become successful. Lastly, successful alliances can impose threats of new competitors if one ally obtains key skills/resources of the other (Dussauge and Bernard, 1999). Based on above characteristics, it can be inferred that cross-industry agreements support MNC to achieve global integration while looking for combining abroad complementary resources to reduce cost of the new business. It is also discussed that cross-industry agreements help to achieve local responsiveness, in case a MNC cooperates with a local company to introduce a brand new products to that specific local market. Alliances between competitors Shared-supply alliances Shared-supply alliances are the form of JV cooperation between competitors sharing similar resources to produce a certain product that is specific to each partner. Shared-supply alliances allow the partners to realize economies of scale, since they will not be able to reach an efficient scale if they produce individually. For example, BMW teamed up with Mercedes to produce a design of a front-wheel-drive-car. The new shared platform allowed BMW to expand the Mini range model more flexibly, while providing Mercedes more conventional and cost-effective measures to launch a substitution for the A- and B-class designs (Autocar, 2007). It is argued that shared-supply alliance is not the only choice for MNC managers, because the target of cost reduction can be solved by traditional method of outsourcing. Firms should only opt for shared-supply alliances once they have other strategic targets other than cost reduction. Moreover, cooperating with competitors to produce similar components may lead undifferentiated products and loosing competitive advantage. Besides, the budget for shared-supply alliances may limit other budgets for necessary activities in the MNCs thus hinder further improvements (Dussauge and Bernard, 1999). Shared-supply alliances can be suitable for MNCs suffering from cost pressure (global and transnational companies). However MNCs should consider carefully before establishing shared-supply alliances because of the potential conflicts. MNCs should consider other strategic benefits other than sole cost efficiency, e.g. exploiting the partners manufacturing experience in local countries. Consequently this model, in case prudently chosen after considering all pros and cons, may be a good choice for transnational companies who have to balance integration and responsiveness. Quasi-concentration alliances This type of alliance allows two competitors to manufacture and market a common product. The partners objective is to realize economies of scale on the product, while their autonomy is still preserved, since the risk of acquisition is avoided. Quasi-concentration alliance is most common in airline industry, e.g. the cooperation between Sud-Aviation in France and British Aircraft Corporation in the UK to form Concorde in 1962 (Heritage Concorde). The advantage of this model is that the partners will not have to compete against each other on that common product. However, Quasi-concentration model may result in the competition between the common product and partner companies products. Additionally, the model may cause the risks of leaking the core technologies to the competitors. Lastly, in case the partners decide to establish a JV to coordinate all the functions of the alliance, there is a risk of losing control over the JV and converting the parent companies in to mere shareholders (Dussauge and Bernard, 1999). Quasi-concentration alliances, with its initial objective of cost reduction, are appropriate for achieving global integration, hence global and/or multinational companies. Complementary alliances In this case the alliance allows partner companies to contribute different assets and resources to executing the cooperative project. For example a firm distributes a rivals product in domestic market. FPT, one of the largest information technology companies in Vietnam went into partnership with Dell to distribute Dells computers and other products in Vietnam market (FPT, 2008). FPT looks for Dells expertise in computer production, while Dell needs FPTs knowledge on local market and distribution network. The advantage of the model is that complementary alliances avoid direct competition between rivals. The alliance also brings about the opportunity to acquire new skills from the partner. However the potential competition between allies does not totally disappear (Dussauge and Bernard, 1999). Complementary alliances may help the partner to achieve local responsiveness because normally the local partner provides the knowledge on how to market the product in local marketplace. However in highly competitive industries, such alliances enable the MNC to focus in its core profession, rather than setting budget for establishing a local distribution network. From that perspective, complementary alliances are also good for global integration. Implications for MNCs For MNCs pursuing a global strategy, the partners in the alliance tend to be highly integrated to the network and operation of the MNCs. The partners are meant to conduct the chosen global strategy of the MNCs (Vapola et al., 2010). From the analysis above it can be inferred that global companies may deploy vertical partnership and quasi-concentration alliances. Multidomestic companies often prefer to have diversified partners, of which each of them is best suited to a particular function in a specific location. In an effort to customize their products towards local demands, multidomestic companies often differentiate their operations in each footprint countries by selecting the most compatible model and partner to form alliance in that nation. Therefore international expansion JVs and complementary alliances are most suitable models for a multidomestic partner. For transnational companies, the alliances are diversified with differentiated contributions, from sensing and exploiting opportunities from local level, to occupying certain roles in the exploitation of the value chain. Each of these partners may possess different partnership needs. So MNC should utilize different types of alliances simultaneously after considering all advantages and disadvantages (Vapola et al., 2010). In the case of international companies, the key issue is knowledge transfer with partners. The MNCs will success if they can transfer their key competencies and knowledge to foreign markets, especially tacit knowledge which is more difficult to codify and transfer than explicit knowledge. On the other hand, this may lead to a conflict with the need for confidentiality of information. Therefore based on their detailed strategy, international companies can consider any suitable type of alliance, but should be extremely prudent with cross-industry agreements and quasi-concentration alliance, since those types of alliances may lead to serious conflicts in knowledge transfer. Another content common to all types of alliances, is the control problem. Control is a critical issue especially in groups of alliances between competitors, since these groups of partner are more sensitive to conflict. In order to successfully manage an alliance, MNCs should focus on control, combining effectively all level of control from personal centralised control, bureaucratic formalised control, output control, to control by socialisation. Those measures are to assure the alliance operates in line with the MNCs original strategy. The cost of control may be high especially for transnational companies who have to deal with all kinds of alliances to achieve both integration and responsiveness. So transnational companies should be prudent in applying control policy with alliance, to avoid the risk that an increase in cost of control could erode profit. Conclusion There is a trend that MNCs are facing increasing pressures from both global integration and local responsiveness equally. No MNC pursuing pure integration or pure responsiveness strategy can become totally successful in the global arena. As a result, achieving the balance between global efficiency and local responsiveness has become an essential issue with most MNCs (Paik and Sohn, 2004), (Girod et al., 2010). Bartlett and Ghoshal (1998) assert that companies must become more globally competitive and, at the same time, more sensitive and responsive to national conditions. MNCs should flexibly choose the way to cooperate with strategic alliance on a case-by-case basis to achieve their specific target for a specific market. From the analysis above we can see that each way of cooperation in alliance has its own advantages and disadvantages. There is neither best model of strategic alliance nor idealistic coordination that leads to optimal performance for all MNCs. Each MNC, based on its own strategy, needs to consider all pros and cons of possible types of strategic alliance before making alliance decision, in order to achieve global integration and/or local responsiveness hence their business plan and strategy. In other words, companies should be clear about why they are entering the alliance and what they expect to gain from it. They also need to understand how it fits into their business plan. (Elmuti and Kathawala, 2001). BIBLIOGRAPHY Autocar (2007) BMW and Mercedes team up to think small. [online] Available at: [Accessed 25th March 2011] Bartlett, C. A. Ghoshal, S. (1998) Managing across borders the transnational solution. 2nd ed. Boston: Havard Business School Press. Bleeke, J. Ernst, D. (1993) Collaborating to compete using strategic alliances and acquisitions in the global marketplace. New York: John Wiley. Doz, Y. L. (1980) Strategic management in multinational companies. Sloan Management Review (pre-1986),21, (2) pp. 27 46. Dussauge, P. Garrette, B. (1999) Cooperative strategy Competing successfully through strategic alliances. Chichester: John Wiley. Elmuti, D., Kathawala, Y. (2001) An overview of strategic alliances. Management Decision, 39, (3) pp. 205 218. FPT (2008) FPT Distribution Dells authorized reseller in Vietnam [online] Available at: [Accessed 25th March 2011] Girod, S., Bellin, J. B. Ranjan, K. S. (2010) Operating models for a multipolar world: balancing global integration and local responsiveness. Journal of Business Strategy, 31, (6) pp. 22 27. Harzing, A. W. (2000) An empirical analysis and extension of the Bartlett and Ghoshal typology of multinational companies. Journal of International Business Studies, 31, (1) pp. 101 120. Heritage Concorde. 1962 Concorde Treaty. Anglo French Agreement. [online] Available at: [Accessed 25th March 2011] Hill, C. W. L. (2001) International Business Competing in the global marketplace. 3rd ed. New York: Irwin McGraw-Hill. Holmberg, S. R. Cummings, J. L. (2009) Building Successful Strategic Alliances: Strategic Process and Analytical Tool for Selecting Partner Industries and Firms. Long Range Planning, 42, (2) pp. 164 193. Johnson, Jr. Julius, H. (1995) An Empirical Analysis of the Integration-Responsiveness Framework: U.S. Construction Equipment Industry Firms in Global Competition. Journal of International Business Studies, 26, (3) pp. 621 635. Lawrence, P. R. Lorsch, J. W. (1967) Organization and environment: managing differentiation and integration. Boston: Graduate School of Business Administration, Harvard University. Paik, Y. Sohn, J. H. D. (2004) Striking a balance between global integration and local responsiveness: the case of Toshiba Corporation in redefining regional headquarters role. Organizational Analysis; 12, (4) pp. 347 359. Robson, M. J. Dunk, M. A. J. (1999). Developing a pan-European co-marketing alliance: the case of BP-Mobil. International Marketing Review, 16, (3) pp. 216 230. Roth, K. Morrison, A. J. (1990) An empirical analysis of the integration-responsiveness framework in global industries. Journal of International Business Studies, 21, (4) pp. 541 564. Sony Ericsson. Mission and Profile. [online] Available at: [Accessed 25th March 2011] Spender, J. C. Grevesen, W. (1999) The multinational enterprise as a loosely coupled system: the global integration local responsiveness dilemma. Managerial Finance, 25, (2) pp. 63 84. Todeva, E., Knoke, D. (2005) Strategic alliances and models of collaboration. Management Decision, 43, (1), pp. 123 148. Vapola, T. J., Paukku, M. Gabrielsson, M. (2010) Portfolio management of strategic alliances: An international business perspective. International Business Review, 19, (3) pp. 247 260. Wheelen, T. L., Hunger, J. D. (2000) Strategic management and business policy: entering 21st century global society. 7th ed. London: Prentice Hall. Yamaha Motor Japan. Asia and Oceania group companies [online] Available at: [Accessed 25th March 2011] PART 2: REFLECTION Word count: 1,431 words Description The International Business Strategy module is contained in the MSc Accounting (Financial services) course which I am attending. The module provides an insight into the strategies of multinational companies (MNC) i.e. international strategy, global strategy, multidomestic strategy and transnational strategy. Based on that basic knowledge, implications for organizational structure, control, knowledge transfer, modes of entry, strategic alliances and internationalization of SMEs are introduced. General evaluation The module has provided me knowledge that is both old and new to me. From undergraduate program in my home country I have studied about globalization, key drivers and how globalization affects international trade. However in this module I found more insights into how globalization affects the formation and development of multinational companies. The theories are really necessary and helpful to understand the real business world, and the way multinational companies are actually formed, structured, managed and developed. The knowledge on globalization and MNCs are systematized and in line with current academic and empirical understanding about international business. However, I believe the knowledge would be absorbed more quickly if more methods of studying are combined, for example group presentations or debates. Analysis I chose to write my assignment with topic 1: Evaluate the ways strategic alliances allow multinational company to achieve global integration and local responsiveness, since I realize this is the increasing trend in international cooperation. I have found a lot of academic literature on the field that I chose. There are a lot of useful information about strategies, Integration Responsiveness framework and strategic alliances. Among those academic literatures, I found the book by Hill (2001) International business Competing on the global marketplace very useful for understanding about the strategy typology of multinational companies. Although prior to Hill (2001) there have been several relevant researches on multinational companies strategy typology, the book still provides comprehensive and detailed description about the four type of strategies adopted by multinational companies, the stages to establish a strategic alliance, and the pros and cons of each strategy. I continued to read about Integration Responsiveness Framework and found the work of Roth and Morrison (1990) helpful to understand about the key concepts of I R Framework, the relationships with strategies and limitations of I R framework. The illustrations and explanation of Bartlett and Goshal (1998) are also fundamental to explain the relationships between I -R Framework and strategies. Although I did not use all the information I read for my assignments due to irrelevance, those are what I am going to bear in mind about the I R Framework in the time to come. For strategic alliances, the book by Dussauge and Garrette (1999) is very useful for the typology of strategic alliances and the advantages/disadvantages of each type of alliance. I made much reference to that book in my assignments due to the systematized typology of alliance and the in-depth analysis the book provides. Besides, the journal of Vapola et al. (2010) gives a systematic approach to analyze portfolio management of strategic alliances based on multinational companies strategy, which I find very useful and made citations in my work. Besides, I also study about other significant issues relating to multinational companies i.e. the structure of international business, control, knowledge transfer, modes of entry and the internationalization of SMEs. I did read a number of books and journals and managed to link relevant contents together. I have also made some inference to other fields of multinational companies like control and knowledge transfer, to have a more objective and broad view of the role of strategic alliances. However I think the links to control and knowledge transfer are not salient in this assignment, because of time and length constraint and especially the fear of deviating from the main topic. Conclusion Theories about I R Framework and its relation to the four strategies of multinational companies are very pragmatic and useful to understand the actual pressures faced by most multinational companies in the global marketplace. Those theories also provide a rationale of how multinational companies respond to global integration and local responsiveness, which helps me to perceive the business world in a more practical and systematic way. Theories about strategic alliances allow me to understand the most common ways that strategic alliances support the partners to achieve their strategic targets. There are 6 typical ways namely international expansion joint ventures, vertical partnerships, cross industry agreements, shared supply alliances, quasi concentration alliances and complementary alliances. I also understand the pros and cons of each type of alliances. I am now able to explain why a multinational company choose to cooperate with non-competitors or competitors, based on their strategy and nature of business. Implications for other concepts i.e. control and knowledge transfer are also inferred in the assignment, therefore a more objective view of MNC operation and its strategic alliances is provided. What has been drawn out from the assignment is that each multinational company, before deciding to cooperate in a strategic alliance, should consider all possible proposals, as well as the strengths and weaknesses of each proposal to judge if the type of alliance helps them achieve global integration and/or local responsiveness in the most effective way. From my perspective, I realize some kinds of strategic alliances are extremely common between developed and developing countries e.g. international expansion joint ventures or complementary alliances. Such knowledge may be useful when I come back to Vietnam and continue my job at an investment bank facilitating international trade and investments. It will be easier for me to fully understand the nature of transactions of MNC customers. I may work out the best solution to serve financial needs for MNC customers. For example, for some important MNC customers, I may propose to apply a more flexible cut-off time for their transactions, because their transactions are, by nature, often between nations in different time zones. Moreover, I may propose to apply a more competitive pricing for transactions between multinational companies and their alliances and/or subsidiaries. The reason is that when two partners contribute resources to a certain alliance project, the transactions for material purchasing, infrastructure costs, personnel mobilization tend to be frequent and of large amount, at least in the short term, which can deliver relatively high non-interest income for the bank. Besides, the business consultant services for institutional customers could be improved when the bank understand the needs of a MNC customer coming into a new developing market and seeking for a potential partner to set up a strategic alliance. The most important learning technique I studied is how to link together different fields of knowledge, in the case of th

Chocolate is Good for You! Essay -- Exploratory Essays Research Papers

Chocolate is Good for You! Did you know that getting a daily dose of dark chocolate may be beneficial to your health? Not only is chocolate the perfect gift for your sweetie on Valentine’s Day, it also may benefit your heart. The ingredients in chocolate are not only delicious, but dark chocolate and cocoa powders also contain disease-fighting antioxidants. The key to gaining the most benefits from dark chocolate is to enjoy it in moderation. According to cnn.com (2000), in addition to antioxidants, one of the fats found in chocolate, called stearic acid, may increase healthy cholesterol (HDL), and make bad cholesterol levels (LDL) less susceptible for oxidation, which leads to clogged arteries. This is the opposite effect one might expect, considering the amount of fat in chocolate. Dark chocolate may also improve blood flow, according to webmd.com (2004). In a study of 27 healthy adults given a cocoa drink with high levels of flavonoids, it was shown that adults over the age of 50 benefited the most. Flavonoids provide protection for plants, and when we consume them, we benefit from their antioxidant power. Antioxidants help the body’s cells resist damage from free radicals (Cleveland Clinic, 2004). The reason for the benefits of cocoa is that it controls the activation of nitric oxide synthase, an enzyme, that keeps blood vessels open allowing the blood to flow. Flavonoids may also lessen stiffening of the blood vessels, which is a common side-effect of aging (WebMD, 2004). It is to be noted that white and milk chocolate do not have the same effect on the body as dark chocolate. These are unfortunately more likely to expand your waistline than improve health. â€Å"Chocoholics† are still at risk for obesity, whic... ...ust 27). Dark Chocolate is Healthy Chocolate. WebMD. Retrieved January 30, 2005 from http://my.webmd.com/content/Article/ 73/81921.htm?printing=true. Peck, Peggy. (2004, May 20). The Right Kind of Chocolate is Heart Healthy. WebMD. Retrieved January 31, 2005 from http://my.webmd.com/content/article/ 87/99509.htm. Rauch, Catherine Ann. (2000, February 2). Chocolate: A Heart-Healthy Confection? CNN. Retrieved on January 29, 2005 from http://archives.cnn.com/2000/ HEALTH/diet.fitness/02/02/chocolate.wmd/. Somer, Elizabeth. (2001, July 16). Crazy for Chocolate. WebMD. Retrieved January 29, 2005 from http://my.webmd.com/content/article/41/1671_52404. The Heart Health Benefits of Chocolate Unveiled. Cleveland Clinic. Retrieved January 30, 2005 from http://www.clevelandclinic.org/heartcenter/pub/guide/prevention/ nutrition/chocolate.htm.

Gender Inequality in the Song of Songs Essay -- Womens Studies

Gender Inequality in the Song of Songs INTRODUCTION Postcolonial Feminist Theory has taught us to look beyond the confines of narrow cultural lenses as we seek to understand the diversity of gendered experience. I believe it is even more empowering to go one step further and to look not only cross-culturally but also cross-temporally. In America, when the general population tries to articulate what traditional female gender roles were, it seems they often describe those prescriptions for being lady-like from the Victorian Era, 1950s post-war America, or maybe limited snapshots of the Middle Ages, like chivalry codes and chastity belts. Accordingly women were, supposedly and stereotypically, traditionally passive and acquiescent. Proper women spoke when spoken to, and then played merely a support role in conversation. They were to express virtue through chastity until marriage, and sexual reserve even within marriage. They were not supposed to ask for the date, lest they seem too forward. They found true fulfillment only in motherhood. They were physically delicate and timid. They were sexual objects instead of active subjects. They were more often written about than authors. They were defined in opposition to men. Places such as the ancient Near East, for example, provide a wealth of information about gendered experience that blatantly contradicts the stereotypical gender-associated behaviors that we in the contemporary West tend to call traditional. Much of it is written by women themselves, such as Egyptian love poetry and Sumerian temple priestesses' administrative records. Because many arguments about the nature of the feminine versus the socialization of femininity look only to relatively recent stereotypes to ass... ...D Falk, Marcia. Love Lyrics from the Bible: A Translation and Literary Study of the Song of Songs. Sheffield: The Almond Press, 1982. ---. The Song of Songs: Love Lyrics from the Bible, A New Translation. New York: HarperCollins, 1993. Freeman, Rebecca and Bonnie McElhinny. "Language and Gender." Sociolinguisitcs and Language Teaching. Eds. McKay, Sandra L. and Nancy H. Hornberger. Cambridge: Cambridge University Press, 1996. Fox, Michael V. The Song of Sons and the Ancient Egyptian Love Songs. Madison: University of Wisconsin Press, 1985. Gordis, Robert. The Song of Songs. New York: The Jewish Theological Seminary of America, 1961. Sweeney, Deborah. Women and Language in the Ramesside Period. The Sonia and Marco Nadler Institute of Archaeology, Tel Aviv Univeristy. http://www.tau.ac.il/~archpubs/projects/women_language_ramesside.html

Group 4 Reflection Essay

Group 4 project was an interesting learning experience. It forced me to work with people that I haven’t worked with before, take into account our team’s different opinions and make the most out of what we had. We started out with an idea, water suspended on a table without a cup, that we spent a whole meeting on, before we realized that it was not possible to do it, which left us with two meetings to decide what we were going to do. I was then unable to make the two next meetings, and this caused major planning problems, which were reflected during our presentation, added to the fact that I did not talk enough with my team members about what we were going to do, which left our whole group pretty much clueless on our actual presentation. Added to this, we all had different ideas about what we wanted to do with the paper helicopter, what size should it be, how we were going to present it, which led to arguments on the day of the presentation. I am usually stubborn, and it is hard to make me change my mind when I am set in a direction, but we finally managed to come to a compromise which satisfied everyone. From this, I learned that my idea is not necessarily the only working solution, and that there isn’t always one solution to a problem, although better planning and better communication could have avoided such problem on the actual presentation day. Regarding the actual presentation, it was obvious that our planning was not very good. Some material was missing, and we had to run around last minute to gather what was left. My teammates were stressing out because they weren’t ready at all, but being used to doing things last minute, I think that managed pretty well to take charge of the group project to get what was needed and to lead the actual presentation, which surprised me. I am not a very good public speakers, in fact I don’t like standing in front of a class and talking, but I found that during this project, not only was I not afraid of going up, but I actually enjoyed it. I learned that when I put as much effort as I can into something, especially something that I like, my fear of public speaking actually goes away and all the hard work that we put into this project, even last minute, comes out and makes something that can be regarded as good. We did have trouble managing the presentation though, as soon as the class started making their own paper helicopters, it was really hard to get them focused again. Our whole team understood that, and instead we instinctively broke up into small groups to try and help everyone achieve the final design. To me, my overall opinion of our presentation is that although we lacked preparation, we ended up doing something good. What I learned from this experience is that I am not limited to what I have done in the past. Taking over the presentation was something that really surprised me, and although I know that I talked a bit too much, I am glad that it happened that way, as it showed me that public speaking can actually be one strength instead of my weakness.

The Kite Runner Summary

The kite runner An alternate book based in Pakistan in which a family consisting of a rich man and his son move to America during the wartime circa 1970. Characters Amir: the narrator and somewhat main character in the book. Baba: Amir's father and also one of the main characters in the book Hassan: Amir's servant and somewhat best friend Ali: Baba's servant and also somewhat best friend Setting The play has generally two settings. The first being in the first half of the book in the homeland if Ali, Al Wazir and the second being the second half of the book in America.Identity – relationships life partners /romantic relationships. Amir's relationship with sprays is a significant turning point in the novel. A series of changes are accompanying this romance shared between the two characters. Amir's relocation to San Francisco, with many other Afghan exiles, is the setting for the relationship. Also, the responder gains an insight into Afghan cultural practices, as the courting p rocess is explored. Impact of settings Once Amir and baba move to America, there riles are somewhat reversed.Baba is forced to work in a petrol station, whereas in Kabul, he was a wealthy, influential industrialist. Baba's struggle is also a change within his character, he is no longer the strong individual that is present in the Part of One novel. Gender Inequality Amir discovers that Soraya has had sexual relationships outside of marriage. Within afghan culture, this is shameful and it would be very difficult for parents to find an appropriate husband for their daughter. Amir's WritingSeeing as Amir is a projection of Khaled Hossieni himself, it is worthwhile assessing Amir's progression as an author. The process begins with his earliest stories (that we leave to Hassan and Rahim Kahn) to the point at which Amir is welcomed to american publishing houses. Area of study Remember that you will need to explore the concept of identity in your creative piece. A good idea would be to con sider the ways in which people form a sense of identity. Key areas could include: Culture Relationships Physical environment Religion Ethnicity Vocation A passion or interest

Owen’s ‘Dulce et Decorum Est’ Essay

Writing in a similar style to Owen’s ‘Dulce et Decorum Est’, Siegfried Sassoon also decided to attack figures of authority and those with no direct experience of trench warfare via ‘Base Details’. ‘Base Details’ is entirely speculative. The word ‘base’ in the title has two distinct meanings. It could be used as a noun, to mean ‘place’, as in a centre of operation; or you could interpret the word as an adjective meaning ‘morally low or unacceptable’. Sassoon has used play on words in the title so that the reader may more adequately perceive the irony and sarcasm expressed in this poem. The adjectives used in the first two lines of ‘Base Details’ reflect the author’s perception of his superiors: If I were fierce, and bald, and short of breath, I’d live with Scarlet Majors at the Base, The first line indicates that Sassoon is contemptuous of these officers. He has classed the Majors as unpleasant stereotypes, to be criticised and jeered at. In the following line, the word ‘scarlet’ has a double meaning. On face value, it could be taken to mean that the officers have bright red cheeks. However, Sassoon has used the word as a metaphor, meaning that the Majors have been metaphorically splattered with the blood of the young men they had sent to the front line to die. The stanza continues: And speed glum heroes up the line to death. Here, ‘speed’ indicates haste. The Majors are unnecessarily rushing soldiers to their deaths. The soldiers are referred to as ‘glum heroes’ because that is exactly what they are. Their country is expecting them to be noble, intrepid and courageous. Instead they are despondent because they know that as soon as they are out of the trenches their grisly demise could come about at any second. All the hope, joy and energy that is a part of youth has vanished from these men. Sassoon then regales us with further speculation thus: You’d see me with my puffy petulant face Guzzling and gulping in the best hotel, The first thing we notice about these two lines is that Sassoon has used alliteration in order to make more of an impact on the reader, and to vary his writing style. Also worth noting is the fact that Sassoon uses rhyme throughout ‘Base Details’ to good and memorable effect. Saying that the Majors are ‘puffy and ‘petulant’ indicates incredulity on Sassoon’s part, similar to that conveyed in the first lines of the poem. The phrase ‘guzzling’ and ‘gulping’ indicates greed, and animal-like actions. The Majors are inhuman. Then, we are told that the Majors stay in ‘the best hotel’. This brings home the stark contrast between the lives of the soldiers in the vermin-infested trenches, and the sedentary lives of their superiors. Sassoon continues: Reading the Roll of Honour. ‘Poor young chap’, I’d say. ‘I used to know his father well: Yes, we’ve lost heavily in this last scrap.’ The Roll of Honour referred to here was an official list of those who died in the war. The Major’s words regarding one of the deceased are not at all heartfelt. They are meaningless, detached and emotionally void. He is unconcerned and he has placed himself above feelings of pity for those lost and their families. Each new death is just another name on the register and another letter to be dispatched. In the last line of the stanza, the Major refers to trench warfare as a ‘scrap’ or ‘game’, which is identical to Jessie Pope’s view of war. This is a direct reflection of how little the Major knows about the fighting going on outside his quarters; and similarly, how unequipped he is for his job of directing troops. ‘Base Details’ closes with the following: And when the war is done and youth stone dead, I’d toddle safely home and die – in bed. By using the words ‘stone dead’ to describe the deceased soldiers, Sassoon makes a brutal and graphic impression on the reader. It is a cold and unfeeling phrase, and seems to render those who died as useless and unimportant. The Major wishes to die peacefully, and in bed – unlike those he sends out to the front. The Major considers himself superior in all aspects, even in death. ‘Base Details’ attempted to show the ignorant public back in Britain the hypocritical attitudes of many of these Majors; and how soldiers in the trenches were being treated in comparison to those who had obtained top jobs merely on the basis of their public schooling. Whilst ‘Base Details’ depicts the life of a typical Major serving during World War One, another of Sassoon’s poems, ‘The Hero’, depicts the sequence of events on the home front following the death of a soldier. The poem ‘Base Details’ by Siegfried Sassoon is a sarcastic attack against the army generals who view the war as a game similar to checkers. It is therefore evidence of why Siegfried Sassoon is known as the â€Å"voice of protest†. The first noticeable thing about the text is the title. The word base is a pun for the fact that base means headquarters as well as dishonourable or cowardly, which implies that he will talk about the dishonourable activities at the Army headquarters. Secondly, Sassoon appeared to have blamed the officers for the purposeless deaths of his fellow men, while they were behind the front line and had no idea what it was like. Sassoon uses many adjectives to describe his generalisation of those at the top â€Å"fat and bald and short of breath† which shows the hatred that he has. In this poem, Sassoon writes â€Å"poor young chap†¦I used to know his father well.† This statement alone is typical of an army general. To show the fact that army generals can not comprehend what war is like he uses the phrase â€Å"we lost heavily in this last scrap†. The army generals are calling this a scrap like it’s a fight between boys at school. Sassoon calls the army generals â€Å"Finally, Sassoon rounds the poem of with a phrase by reinforcing that they are unfit and fat. He also shows that those at the front line could die any moment by saying â€Å"When the war is done and youth stone dead, Id toddle safely home and die, in bed† which is a good ending because it says that the generals will die in a nice warm peaceful place, while the soldiers will die among the rats. Sassoon’s feelings towards the officers are best described in the poem ‘Base Details’. In this poem, Sassoon shows his resentment towards the officers by describing them drinking in the best hotels, and reading the names of those who died, saying ‘poor young chap †¦ I used to know his father well’ and saying ‘yes, we’ve lost heavily in this last scrap’. The poem is finished with the lines â€Å"and when the war is done and youth stone dead, I’d toddle safely home and die – in bed† This poem truly shows the bitterness and resentment Sassoon felt towards the officers. He felt that they didn’t really care about those who died, because they were safe themselves and had no idea of what was going on at the front line – calling the battle that was fought a ‘scrap’, like it was nothing more than a small fight. In the last two lines of the poem, Sassoon’s feelings are clearer than ever, the way he says that they’ll ‘toddle home and then die in bed shows that he thought that the officers were safe and living comfortably while the soldiers, who were actually fighting the war, were living in shocking conditions, where they would die at any moment. Sassoon uses many different ways to convey his feelings, and particularly his bitterness and resentment towards the war and the officers, but in all his poems, his true meanings are clear and he writes in such a way that shows us clearly what he thinks and feels about the war. BASE DETAILS – ESSAY In the poem, â€Å"Base Details†, SiegFried Sassoon expresses his great disgust towards the majors in the military. He is horrified and appalled at the way the majors act while men are dying out in the battle field. Mr. Sassoon is so furious towards the majors that it takes more than just one word to describe how indignified Sassoon is. These great feelings of anger are derived from the fact that the majors are living a life of luxury while sending young men â€Å"up the line† out into the battle field. This is all suggested in the title of the poem with the word â€Å"base† suggesting a military base, and/or a base person. And the word â€Å"details† suggesting a command, an assignment, and something or someone lowly. â€Å"Base Details† is a poem which expresses the feelings of the author towards military majors using differentiable types of imagery. The poem begins by Sassoon describing the majors as demanding, mean, and belligerent men. Bald, out-of-shape and full of gluttony. Sassoon categorizes the majors under the word scarlet signifying childless, bright redness from excessive drinking and yelling of anger. Sassoon presents to us the fact of the majors sending up the young men as soon as they are drafted â€Å"up the line to death.† This attitude taken from the majors is what angers Sassoon to the point of hatred. To convince the reader of such horrific truth, Sassoon describes how disrespectful the majors are with their â€Å"puffy petulant faces† from eating and drinking excessively. Sassoon states how the majors are stuffing their faces and â€Å"Reading the Roll of Honor† in safe luxurious hotels while men are dying out on the field

Ratio Analysis

Though there are innumerable literatures available on the subject, the most appropriate studies have been reviewed. Dr. Promod Kumar published a book in 1991 â€Å"Analysis of financial statement of Indian Industries† The study covered the 17 private sector, 5 state owned public sector and 1 central public sector companies. He studied analysis of activities, assessment of profitability, return on capital investment, analysis of financial structure, analysis of fixed assets and working capital.In his research he revealed various problems of industries and suggested remedies for the problems. He also suggested for the improvement of profitability and techniques of cost control. 1Ahindra Chakrabati published an articles â€Å"Performance of public sector enterprises a Case study on fertilizers† in â€Å"The Indian journal of public enterprise† in the year 1988-89. He made analysis of consumption and production of fertilizer by public sector; he also made analysis of profit and loss statement. He gave suggestion to improve the overall performance of public enterprise. In the year of 2002, Dr. Sugan C. Jain has written a book on â€Å"Performance appraisal automobile industry† In his study he has analyses the performance of the automobile industry and presented comparative study of some national and international units. The operational efficiency and profitability had been analyzed using the composite index approach. He made several suggestions from the strengthening the financial soundness improving profitability, working capital the performance of fixed assets. 3 Recently in the year 1998 a study was made by S.J. parmar on â€Å"Financial Efficiency-Modern methods, tools & Techniques† for the period from 1998-89 to 1994-95. He had made an attempt to analyze financial strength, liquidity, profitability, cost and sales trend and social welfare trend by using various ratios analysis, common size analysis and value added analysis. He made several suggestions for the improvement of profitability of industry. In his analysis, he indicates various reasons for higher cost, low profitability, and inefficient use of internal resources. Dr Sanjay Bhayani published a book in 2003, â€Å"Practical financial statement analysis† The study covered 16 public limited cement companies in private sector. He made study of analysis of profitability, working capital, capital structure and activity of Indian cement industry. In his research he revealed various problems of cement industries and suggested remedies for the problems. He also suggested for the improvement of profitability and techniques of cost control. Ram Kumar,Kakani Biswatosh saha and V. N. Reddy has written research paper on Determinants of Financial Performance of Indian Corporate Sector in the Post-Liberalization Era: An Exploratory Study. This paper attempts to provide an empirical validation of the widely held existing theories on the determinants of fi rm performance in the Indian context. The study uses financial statement and capital market data of 566 large Indian firms over a time frame of eight years divided into two sub-periods (viz. 1992-96, and 1996-2000) to study Indian firms' financial performance across various dimensions viz. , shareholder value, accounting profitability and its components, growth and risk of the sample firms. It reveals that even on the same data, the determinants of market-based performance measures and accounting-based performance measures differ due to influence of ‘Capital Market Conditions'. We found that size, marketing expenditure, and international diversification had a positive relation with a firm's market valuation.Apart from these firm attributes that reflect either operating parameters of firms or ‘strategic choice' of firm managers, we also found that a firm's ownership composition, particularly the level of equity ownership by Domestic Financial Institutions and Dispersed Pu blic Shareholders, and the leverage of the firm were important factors affecting its financial performance. The different implications of the findings for various stakeholders of a firm are also discussed. 6Dutts S. K has written an article on â€Å"Indian tea industry an appraisal† which was published in Management accountant in the year of March 1992.He analyzed the profitability, liquidity and financial efficiency by using various ratios. 7 Objectives of the study  · To evaluate the financial performance of the selected units of Pharmaceutical industry  · To compare the financial results of the Pharmaceutical industry as Dr Reddy's Laboratories Ltd and Lupin Ltd  · To enquire the adequacy or the accounting information desired from the statement in conformity with laid down accounting statements by the institute of Chartered Accountants of India (ICAI).  · To study the growth of the said companies To give suggestion for best financing method and efficient utilizatio n of fixed assets METHODOLOGY OF THE STUDY: Source of the data: â€Å"Comparative Financial statement Analysis & Innovation in Private sector Pharmaceutical Companies in India† has been made by using data from financial statements of all five major players in cement industry, they are – Dr Reddy's Laboratories Ltd. (Dr. RDL), Ambuja Lupin Ltd. (LL), the period of the study was ten years from 2001 to 2010. The data was collected from cpitaline database and from the annual reports of the respective companies.Hypothesis for the study: For the present study tested following null hypotheses are tested-  · Ho1: The Dr Reddy's Laboratories Ltd. did not achieve better profitability than Lupine Ltd.  · Ho2: The Dr Reddy's Laboratories Ltd. did not achieve better liquidity than Lupine Ltd.  · Ho3: The Dr Reddy's Laboratories Ltd. did not achieve better turnover than Lupine Ltd. Scope of the study: the study Comparative Financial statement Analysis & Innovation in Private s ector Pharmaceutical Companies in India.The study therefore includes financial structure performance, working capital performance, and Profitability performance but excludes non-financial areas such as production, marketing, personnel and R& D from its purview. Techniques used for analysis: The data have been analyzed with the help of ratio analysis, trend analysis, common size analysis-T test to test the relation among different ratios of two selected companies. Limitation of the study: In order to facilitate uniformity in data, years have been readjusted and the data have been recast as on 31st March of each year.The figure taken from the annual reports have been rounded off to two decimals of rupees in crores. The data available in financial statements have been translated in to a pre-designed structure format so that a meaningful interpretation could be made through inter-firm and intra firm comparisons. The format in which the data have been classified is selected after careful consideration of the operation Pharmaceutical Companies. Nevertheless, the limitations do in no way act as a deterrent in drawing effective and meaningful inferences from the studyAnalysis of the data: for knowing Comparative Financial statement Analysis & Innovation in Private sector Pharmaceutical Companies in India the commonly used ratio: fixed Gross profit, Net profit, Return on capital employed, Return on Net worth and Earning per share, Current ratio, Debtors Velocity (Days), Creditors Velocity (Days), Debt equity ratio and Interest coverage ratio, Inventory turnover Ratio, Debtors Turnover Ratio and Total Assets Turnover Ratio Analysis and interpretation: Table-1 Profitability Ratios of Dr Reddy's Laboratories Ltd & Lupine Ltd. Gross profit Net profit ROC RON EPS Year Dr. RDL Lupin Ltd. Dr.RDL Lupin Ltd. Dr. RD Lupin Ltd. Dr. RD Lupin Ltd. Dr. RD Lupin Ltd. 2001 22. 16 9. 25 19 6. 65 31. 5 23. 02 29. 23 31. 13 45. 32 201. 66 2002 33. 1 12. 49 32. 39 7. 54 42. 06 16. 64 45. 71 22. 07 59. 56 17. 42 2003 30. 78 12. 2 28. 34 7. 3 26. 44 16. 05 24. 02 20. 3 50. 6 17. 44 2004 21. 55 19. 07 20. 4 12. 48 15. 61 27. 1 14. 7 36. 14 36. 37 23. 76 2005 7. 9 9. 77 9. 19 6. 96 2. 19 12. 75 2. 77 17. 79 7. 85 20. 09 2006 16. 27 16. 29 14. 12 11 9. 24 20. 86 8. 57 31. 93 26. 82 44. 61 2007 37. 06 16. 27 32. 39 10. 53 35. 94 19. 39 35. 47 27. 89 69. 45 36. 75 2008 21. 63 19. 27 18. 47 13. 53 12. 01 23. 85 10. 35 32. 02 27. 2 52. 31 2009 21. 77 18. 28 17. 8 14. 17 13. 55 22. 29 11. 14 30. 97 32. 25 48. 22 2010 28. 77 21. 56 23. 52 17. 7 17. 79 25. 6 15. 14 33. 23 48. 25 70. 7 Total 240. 99 154. 45 215. 62 107. 86 206. 33 207. 55 197. 1 283. 47 404. 09 532. 96 Average 24. 099 15. 445 21. 562 10. 786 20. 633 20. 755 19. 71 28. 347 40. 409 53. 296 Min 7. 9 9. 25 9. 19 6. 65 2. 19 12. 75 2. 77 17. 79 7. 85 17. 42 Max 37. 06 21. 56 32. 39 17. 7 42. 06 27. 1 45. 71 36. 14 69. 45 201. 66 Sources: Data has been taken from annual reports The gross profit ratio of Dr. RDL was 22 . 16 % in 2001 which went down in to 7. 9% in 2005 but it rose up to 28. 7% in last years of the study period. The ratio ranged between 7. 9% in 2005 to 37. 06% in 2007. The ratio showed highly fluctuated trend during the study period. The average gross profit ratio was 24. 09% indicated. The gross profit ratio of Lupin Ltd. showed highly fluctuated trend during the study period with an average of 15. 45%. The ratio was the highest in the year of 2010 and very lowest 2001. T-test T-Test: Calculated value of gross profit ratio is 2. 86 Tabulated value at 5% significant value=1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is rejected. The Net profit ratio of Dr.RDL was 19% in the year of 2001 and increased to 32. 39% in the year of 2002. The ratio went down to 28. 34% in year of 2003. The ratio was very low of 9. 19% during the year of 2005 and very highest during the year of 2002. The average ratio was 21. 56% with fluctuated trend. The Net profit r atio of Lupin Ltd. was 6. 65 % in 2001 which went down in to 6. 96% in 2005 but it rose up to 17. 7% in last years of the study period. The ratio ranged between 6. 65% in 2001 to 17. 7% in 2010. The ratio showed highly fluctuated trend during the study period. The average gross profit ratio was 10. 78% indicated. T-testCalculated value of net profit ratio is 4. 01 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is rejected. The return on capital employed ratio was 31. 5% in 2001 which went down to 9. 24 % in the year of 2006 and also went down to 13. 55% and 17. 79 during the years of 2009 and 2010 respectively. The ratio ranged between 2. 19% in year of 2005to 42. 06% in the year of 2002. The ratio showed down ward trend with an average of 20. 63%. The return on capital employed of Lupin Ltd was showing much fluctuated trend during the year study period.The average ratio was 20. 76 in the Lupin Ltd which sho wed fluctuated trend during the study period. The ratio was 23. 02% in year of 2001 and 20. 86% in year of 2006 and 25. 6% during the last year of study period. The ratio has gone down due to decreased in volume of sales. The sales have gone down since price rise took place in market. T-test Calculated value of return on capital employed ratio is 0. 028 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is accepted. The Return on net worth ratio of Dr. RDL was 29. 3% in 2001 which went down in to 8. 57% in 2006 but it rose up to 15. 14% in last years of the study period. The ratio ranged between 2. 77% in 2005 to 45. 71% in 2002. The ratio showed highly fluctuated trend during the study period. The average gross profit ratio was indicated19. 71%. The Return on net worth ratio of Lupin Ltd. showed highly fluctuated trend during the study period with an average of 28. 347%. The ratio ranged between 17. 79% in 2005 to 36. 14% in 2004. T-test Calculated value of Return on net worth ratio is 1. 84 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance cal ; t tab Hence hypothesis is rejected. Earnings per share of Dr. RDL were Rs. 45. 32 in the year of 2001 and Rs 59. 56 in the year of 59. 56. The EPS went down to 50. 6 in the year of 2003 and Rs 36. 37 in the year 2004 and Rs. 7. 85 in the year of 2005. The EPS rose to 69. 45 in the year 2007and again went down to 27. 62 in 2008. The EPS Rs. 48. 25 during the last year of study period. The average ESP was 40. 41 with downward trend during the study period. The EPS was 201. 66 in Lupin Ltd. and went down to 20. 09 in the year of 2005 and reached down to 70. 7 during the last year of study period.The EPS showed lower level of EPS due to less utilization of financial leverage. T-test Calculated value of Earnings per share is 0. 70 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of s ignificance t cal ; t tab Hence hypothesis is accepted. Table-2 Liquidity ratio of Dr. RDL and Lupin Ltd. Current ratio Debtors Velocity (Days) Creditors Velocity (Days) Year Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. 2001 1. 69 1. 82 48 47 76 27 2002 3. 09 1. 74 54 61 79 35 2003 4. 86 1. 58 60 62 82 36 2004 3. 73 1. 34 60 66 85 38 2005 2. 49 1. 1 60 56 90 34 2006 1. 5 1. 38 59 57 94 35 2007 2. 21 1. 68 66 63 105 38 2008 3. 05 1. 53 85 69 109 42 2009 3. 15 1. 24 79 77 110 45 2010 2. 44 1. 27 100 81 120 52 Total 28. 56 14. 68 671 639 950 382 Average 2. 856 1. 468 63 62 92 37 Min 1. 69 1. 1 48 47 76 27 Max 4. 86 1. 82 100 81 120 52 Sources: Data has been taken from annual reports In year 2001 Dr. RDL has 1. 69 as its current ratio and after that it continuously increased from 3. 09 to 4. 86 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negative changes but it moves from 2. 21 to 3. 05 in year 2007 and 2008 respectively.In the yea r 2009 and 2010 it shows again little fluctuated with an average of 2. 85. In year 2001 Lupin Ltd has 1. 82 as its current ratio and after that it continuously decreased from 1. 74 to 1. 58 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negative changes but it moves down from 1. 68 to 1. 53 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuated with an average of 1. 46. T-test Calculated value of current ratio is 4. 50 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance cal ; t tab Hence hypothesis is rejected. In year 2001 Dr. RDL has 48 days as its Debtors Velocity (Days) and after that it continuously increased from 54 (Days) to 60 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negative changes but it moves down from 66 days to 85 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctua tions with an average of 63 days. In year 2001 Lupin Ltd. has 47 days as its Debtors Velocity (Days) and after that it continuously increased from 61 (Days) to 62 in the year of 2002 and 2003 respectively.But in year 2004, 2005 & 2006 it also showed negative changes but it moves up from 63 days to 69 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 62 days. T-test Calculated value of Debtors Velocity (Days) is 0. 3 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is accepted. In year 2001 Dr. RDL 76 days as its Creditors Velocity (Days) and after that it continuously increased from 79 (Days) to 82 in the year of 2002 and 2003 respectively.But in year 2004, 2005 & 2006 it also showed negative changes but it moves down from 105 days to 109 days in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with a n average of 92 days. In year 2001 Lupin Ltd. 27 days as its Creditors Velocity (Days) and after that it continuously increased from 35 (Days) to 36 days in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed positives changes but it moves down from 38 days to 42 days in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 37 days.T-test Calculated value of Creditors Velocity (Days) is 10. 83 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is rejected. Leverage Ratios of Dr. RDL & Lupin Ltd. Table-3 Leverage Ratios of Dr. RDL & Lupin Ltd. Debt equity ratio Interest coverage ratio Year Dr. RDL Lupin Ltd. Dr. RD Lupin Ltd. 2001 0. 56 1. 79 5. 05 2. 09 2002 0. 19 1. 88 34. 27 2. 55 2003 0. 01 1. 77 72. 27 2. 53 2004 0. 02 1. 24 72. 71 4. 89 2005 0. 08 0. 86 3. 82 4. 12 2006 0. 28 1. 18 10. 39 8. 6 2007 0. 19 1. 16 27. 29 8. 65 2008 0. 09 0. 83 40. 74 13. 99 2009 0. 11 0. 71 27. 62 2. 35 2010 0. 11 0. 47 68. 8 25. 97 Total 1. 64 11. 89 362. 96 85. 74 Average 0. 16 1. 19 36. 30 8. 57 Min 0. 01 0. 47 3. 82 2. 09 Max 0. 56 1. 88 72. 71 25. 97 Sources: Data has been taken from annual reports The Debt equity ratio of Dr. RDL was 0. 56 in 2001 which went down in to 0. 28 in 2006 but it went down to 0. 11 in last years of the study period. The ratio ranged between 0. 01 in 2003 to 0. 56 in 2001. The ratio showed highly fluctuated trend during the study period. The average Debt equity ratio was indicated 0. 16. In year 2001 Lupin Ltd. 1. 79 as its Debt equity ratio and after that it continuously decreased from 1. 8 to 1. 77 days in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed positives changes but it moves down from 1. 16 to 0. 83 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 1. 19 days. T-test Calc ulated value of Debt equity ratio is 6. 28 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is rejected. Interest coverage ratio of Dr. RDL was 5. 05 in the year of 2001 and Rs 3. 82 in the year of 2006. The Interest coverage ratio went up to 72. 7 in the year of 2003 and 72. 71 in the year 2004 and 3. 82 in the year of 2005. The Interest coverage ratio rose to 27. 29 in the year 2007and again went up to 40. 74in 2008. The Interest coverage ratio was 68. 8 during the last year of study period. The average Interest coverage ratio was 36. 30 with upward trend during the study period. In year 2001 Lupin Ltd. 2. 09 as its Debt equity ratio and after that it continuously decreased from 2. 55 to 2. 53 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negatives changes but it moves down from 8. 65 to 13. 99 in year 2007 and 2008 respectively.In the year 2009 and 2010 it shows aga in little fluctuations with an average of 8. 57. T-test Calculated value of Interest coverage ratio is 3. 13 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is rejected. Table-4 Turnover ratio of Dr. RDL and Lupin Ltd. Inventory Turnover Ratio Debtors Turnover Ratio Total Assets Turnover Ratio Year Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. 2001 8. 65 11. 3 4. 76 5. 39 1. 03 1. 6 2002 9. 01 6. 61 4. 29 3. 06 0. 99 1. 32 2003 7. 44 7. 02 3. 64 2. 75 0. 92 1. 29 2004 6. 99 6. 74 3. 97 3. 89 0. 88 1. 7 2005 5. 79 5. 23 3. 78 5. 37 0. 85 1. 31 2006 5. 64 5. 95 4. 21 5. 69 0. 82 1. 28 2007 8. 69 5. 7 4. 94 4. 9 0. 75 1. 14 2008 6. 11 5. 08 3. 53 4. 7 0. 65 1. 09 2009 6. 16 4. 39 3. 66 4. 39 0. 64 0. 99 2010 5. 57 5. 13 3. 66 4. 51 0. 59 0. 94 Total 70. 05 63. 15 40. 44 44. 65 8. 12 12. 23 Average 7. 005 6. 315 4. 044 4. 465 0. 812 1. 223 Min 5. 57 4. 39 3. 53 2. 75 0. 59 0. 94 Max 9. 01 11. 3 4. 94 5 . 69 1. 03 1. 6 Sources: Data has been taken from annual reports In year 2001 Dr. RDL 8. 65 as its Inventory Turnover Ratio and after that it continuously decreased from 9. 01 to 7. 44 in the year of 2002 and 2003 respectively.But in year 2004, 2005 & 2006 it also showed negatives changes but it moves down from 8. 69 to 6. 11 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 7. 01. In year 2001 Lupin Ltd. 11. 3 as its Inventory Turnover Ratio and after that it continuously increased from 6. 61 to 7. 02 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with ups and downs but it moves down from 5. 7 to 5. 08 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 6. 2. Calculated value of Inventory Turnover Ratio is 0. 72 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is accepted. In year 2001 Dr. RDL. 4. 76 as its Debtors Turnover Ratio and after that it continuously decreased from 4. 29 to 3. 64 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with upward movements but it moves down from 4. 94 to 3. 53 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 4. 04.In year 2001 Lupin Ltd. 5. 39 as its Debtors Turnover Ratio and after that it continuously decreased from 3. 06 to 2. 75 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with upward movements but it moves down from 4. 9 to 4. 73 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 4. 47. Calculated value of Debtors Turnover Ratio is 1. 21 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hy pothesis is accepted. In year 2001 Dr. RDL. 1. 3 as its Total Assets Turnover Ratio and after that it continuously decreased from 0. 99 to 0. 92 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with downward movements but it moves down from 0. 75 to 0. 65 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 0. 81. In year 2001 Lupin Ltd. 1. 6 as its Total Assets Turnover Ratio and after that it continuously decreased from 1. 32 to 1. 29 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with upward movements but it moves down from 1. 4 to 1. 09 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 1. 22. Calculated value of Total Assets Turnover Ratio is 5. 34 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hyp othesis is rejected. Summary findings and Conclusion The liquidity ratio of Lupin Ltd is highly threatening when compared with Dr. RDL. Thus Lupin Ltd has to control the current liabilities or to increase the current assets so that they can cover all the current liabilities and be in safer position.Thus slightly fluctuations in sales in that situation can not affect the paying capacity of the concern and thus maintain the credibility. The profitability ratio of Dr. RDL is better when it is compared with Lupin Ltd. It can be inferred from the result that Lupin Ltd can expand the business or can move further in newer directions as it is experiencing continuously growth in the profitability. Lupin Ltd has to give a fairer thought to reduce cost in providing services and increasing the turnover so that sustained growth in profitability can be seenReturn on Net Capital Employed is the best test of overall profitability and efficiency of the business firm. A company with high rate of retu rn on capital employed would be in a position to capitalize; e. g. it can take advantage of all favorable market opportunities. The study shows that returns on capital employed in selected units in India had marked a fluctuated trend. The average was 17. 79 and 25. 6 percent in units in India respectively. This ratio was satisfactory. On the whole Dr. DRL had the highest return net on capital employed of As compared to the Lupin ltd.In the light of the above discussion it is suggested that Lupin ltd should undertake cost control measure so that increase net profit before interest and taxes of the company might enhance the return on net capital employed. The solvency ratio also reveals the same track record of an upper hand over Lupin ltd. This position depicts the financial soundness or good financial health of the DR. RDL. In this sector Lupin ltd. has to work hard for providing the financial health in terms of capital also. The turnover ratio of Lupin Ltd. is showing better positi on when compared to DR. RDL. This fact proves that the market size in Lupin Ltd. s far more better than the DR. RDL which in turn is gearing its growth in all the stream. Thus DR. RDL has to work for increasing the market size and customer base so that it can achieve the trend of continuous growth. It can be inferred from the overall financial analysis that Lupin Ltd ltd. has to rethink and device the strategies so that it can lead towards positive way and become the major players. Innovation though financial statement analysis can be seen though mergers and acquisitions and launching of new products and schemes so that enterprise can be proud of being major market players and setter newer and newer goals in the future.Cost accounting and cost audit should be made mandatory for this units and cost sheet along with annual financing statement should be prepared. The policy of borrowed financing in selected Parma group of companies under study was not proper. So the companies should us e widely the borrowed funds and should try to reduce the fixed charges burden gradually by decreasing borrowed funds and by enhancing the owner’s fund. For this purpose companies should enlarge their equity share capital by issuing new equity shares. There has been too much of government interference in policy and day-to-day working and decisions.This leads to delays in decision-making. This should be abolished. There is no incentive to the employees to perform better. Also there is no accountability because no one is held responsible for a failure in achieving targets for this kind of problem responsibility centre should be created. Improper planning and delays in implementation of projects lead to rise in their cost. So properly planning should be made. To regularize and optimize the use of cash balance proper techniques may be adopted for planning and control of cash. The investments in inventories should be reduced and need to introduce a system of prompt collection of de bts.Selected pharma companies should try to use properly their operating assets and should try to minimize their non-operating expenses. To conclude the study, it can be said that the adoption of above measures will doubtlessly help the selected companies to improve their overall performance in the management. With the efficient management of long term fund, selected companies can utilized their capacity optimally and accelerate economic growth of India by increasing the production of pharma product at reasonable cost. References. 1. Dr. Promod Kumar. â€Å"Analysis of financial statement of Indian Industries†Saujaniya Publication Ltd. 1992 2. Ahindra Chakrabati: â€Å"Performance of public sector enterprises a Case study on fertilizers† The Indian journal of public enterprise. 1988-89 3. Dr. Sugan C. Jain: â€Å"Performance appraisal automobile industry† Raj Publishing House, c2002. Jaipur, India 4. Parmar S. J. :â€Å"Financial Efficiency-Modern methods, tool s & Techniques† Raj publication year of publication-2001 5. Dr Sanjay Bhayani: â€Å"Practical financial statement analysis† Raj publication,2003 6. Kakani, Ram Kumar, Saha, Biswatosh and Reddy, V. N.Nagi, Determinants of Financial Performance of Indian Corporate Sector in the Post-Liberalization Era: An Exploratory Study (November 2001). National Stock Exchange of India Limited, NSE Research Initiative Paper No. 5. 7. Dutts S. K has: â€Å"Indian tea industry an appraisal† Management accountant, March-1992 8. Brigham, Eugene. F and Joel F. Houston. â€Å"Fundamentals of Financial Management, Ninth Edition, Harcourt College Publishers, Fort Worth, 2001. 9. Review of Business Research, 2007 by Tarun K. Mukherjee, Prakash Deo. 10. Gitman, L. J. , â€Å"Principles of Management finance,† New York: Harper & Row publishers,1982,p. 81 11. Paton & Paton. , â€Å"Corporation Accounts and statements†, New York: Macmillan Company, 1964, p. 362. 12. Kulshresh tha, N. K. , â€Å"Analysis of Financial statements of Indian Paper industry†, Aligarh: Navman Publishing House, 1972, p. 133. 13. Kulshreshtha, N. K. , Op. cit. , p. 134. 14. Hunt W. and Donaldson, G. , â€Å"Business Finance-text and cases†, Illinois: Richard D. Irwin, 1965, Pp. 114-115. 15. Roy Chowdhar, A. B. , â€Å"Analysis and Interpretation of Financial statements†, New Delhi Orient Longmans, 1970, p. 24. 16. Bogen, J. J. , â€Å"Financial Handbook† New Delhi: The Ronald press, 1957,p. 53. 17. Weston, J. F. and Brigham, E. F. , â€Å"Management finance†, New York: Holt, Rinehart and Winton, Inc, . 1972, p. 88. 18. Hingorani, N. L. and Raman than, A. R. , â€Å"Management Accounting†, New Delhi: Sultan Chand & Sons, 1977,p. 115. 19. Srivastava, R. M. , â€Å"Financial Management†, Meerut India: Pragati Prakasjan, 1979, p. 476. 20. Westiwick, C. A. , â€Å"Management: How to use ratios†, Epping Essex: Grower Press Ltd. 19 73,p. 5 21. Bogen, J. J. , Op. cit. Pp. 751-752. 22. Mohsin, M. , â€Å"Financial Planning and Control†; NewDelhi: Vikas publishing House Pvt. Ltd. , 1980, p. 174. 23.Kulshrestha, N. K. Op. cit. , 139. 24. HENDERSON, G. V. , Gurry, J. R. Trnnep Oh. , James E. Wirt. , â€Å"An Introduction to financial Management†, California: Addition-Wesley publishing company, 1984, p. 122. 25. Anthony, R. N. and Reece, J. S. , Op. , cit. , p. 198. 26. Information obtained through unstructured interviews from financial managers of the sample units though telephone. 27. Annual reports of selected cement company from 2003-04 to 2008-09 28. Kennedy, R. D. and Mcmullen, S. Y. , â€Å"Financial statements: Forms analysis and interpretation†, Illnois: Richard D. Irwin inc. 1964, p. 404. Information about this Article Peer-review ratings (from 2 reviews, where a score of 100 represents the ‘average’ level): Originality = 175. 00, importance = 162. 50, overall quality = 16 2. 50 This Article was published on 14th March, 2012 at 18:41:24 and has been viewed 2635 times. This work is licensed under a Creative Commons Attribution 2. 5 License. The full citation for this Article is: Kakkad, R. (2012). Comparative Financial statement Analysis & Innovation in Private sector Pharmaceutical Companies in India-An empirical Analysis. PHILICA. COM Article number 318. Ratio Analysis Though there are innumerable literatures available on the subject, the most appropriate studies have been reviewed. Dr. Promod Kumar published a book in 1991 â€Å"Analysis of financial statement of Indian Industries† The study covered the 17 private sector, 5 state owned public sector and 1 central public sector companies. He studied analysis of activities, assessment of profitability, return on capital investment, analysis of financial structure, analysis of fixed assets and working capital.In his research he revealed various problems of industries and suggested remedies for the problems. He also suggested for the improvement of profitability and techniques of cost control. 1Ahindra Chakrabati published an articles â€Å"Performance of public sector enterprises a Case study on fertilizers† in â€Å"The Indian journal of public enterprise† in the year 1988-89. He made analysis of consumption and production of fertilizer by public sector; he also made analysis of profit and loss statement. He gave suggestion to improve the overall performance of public enterprise. In the year of 2002, Dr. Sugan C. Jain has written a book on â€Å"Performance appraisal automobile industry† In his study he has analyses the performance of the automobile industry and presented comparative study of some national and international units. The operational efficiency and profitability had been analyzed using the composite index approach. He made several suggestions from the strengthening the financial soundness improving profitability, working capital the performance of fixed assets. 3 Recently in the year 1998 a study was made by S.J. parmar on â€Å"Financial Efficiency-Modern methods, tools & Techniques† for the period from 1998-89 to 1994-95. He had made an attempt to analyze financial strength, liquidity, profitability, cost and sales trend and social welfare trend by using various ratios analysis, common size analysis and value added analysis. He made several suggestions for the improvement of profitability of industry. In his analysis, he indicates various reasons for higher cost, low profitability, and inefficient use of internal resources. Dr Sanjay Bhayani published a book in 2003, â€Å"Practical financial statement analysis† The study covered 16 public limited cement companies in private sector. He made study of analysis of profitability, working capital, capital structure and activity of Indian cement industry. In his research he revealed various problems of cement industries and suggested remedies for the problems. He also suggested for the improvement of profitability and techniques of cost control. Ram Kumar,Kakani Biswatosh saha and V. N. Reddy has written research paper on Determinants of Financial Performance of Indian Corporate Sector in the Post-Liberalization Era: An Exploratory Study. This paper attempts to provide an empirical validation of the widely held existing theories on the determinants of fi rm performance in the Indian context. The study uses financial statement and capital market data of 566 large Indian firms over a time frame of eight years divided into two sub-periods (viz. 1992-96, and 1996-2000) to study Indian firms' financial performance across various dimensions viz. , shareholder value, accounting profitability and its components, growth and risk of the sample firms. It reveals that even on the same data, the determinants of market-based performance measures and accounting-based performance measures differ due to influence of ‘Capital Market Conditions'. We found that size, marketing expenditure, and international diversification had a positive relation with a firm's market valuation.Apart from these firm attributes that reflect either operating parameters of firms or ‘strategic choice' of firm managers, we also found that a firm's ownership composition, particularly the level of equity ownership by Domestic Financial Institutions and Dispersed Pu blic Shareholders, and the leverage of the firm were important factors affecting its financial performance. The different implications of the findings for various stakeholders of a firm are also discussed. 6Dutts S. K has written an article on â€Å"Indian tea industry an appraisal† which was published in Management accountant in the year of March 1992.He analyzed the profitability, liquidity and financial efficiency by using various ratios. 7 Objectives of the study  · To evaluate the financial performance of the selected units of Pharmaceutical industry  · To compare the financial results of the Pharmaceutical industry as Dr Reddy's Laboratories Ltd and Lupin Ltd  · To enquire the adequacy or the accounting information desired from the statement in conformity with laid down accounting statements by the institute of Chartered Accountants of India (ICAI).  · To study the growth of the said companies To give suggestion for best financing method and efficient utilizatio n of fixed assets METHODOLOGY OF THE STUDY: Source of the data: â€Å"Comparative Financial statement Analysis & Innovation in Private sector Pharmaceutical Companies in India† has been made by using data from financial statements of all five major players in cement industry, they are – Dr Reddy's Laboratories Ltd. (Dr. RDL), Ambuja Lupin Ltd. (LL), the period of the study was ten years from 2001 to 2010. The data was collected from cpitaline database and from the annual reports of the respective companies.Hypothesis for the study: For the present study tested following null hypotheses are tested-  · Ho1: The Dr Reddy's Laboratories Ltd. did not achieve better profitability than Lupine Ltd.  · Ho2: The Dr Reddy's Laboratories Ltd. did not achieve better liquidity than Lupine Ltd.  · Ho3: The Dr Reddy's Laboratories Ltd. did not achieve better turnover than Lupine Ltd. Scope of the study: the study Comparative Financial statement Analysis & Innovation in Private s ector Pharmaceutical Companies in India.The study therefore includes financial structure performance, working capital performance, and Profitability performance but excludes non-financial areas such as production, marketing, personnel and R& D from its purview. Techniques used for analysis: The data have been analyzed with the help of ratio analysis, trend analysis, common size analysis-T test to test the relation among different ratios of two selected companies. Limitation of the study: In order to facilitate uniformity in data, years have been readjusted and the data have been recast as on 31st March of each year.The figure taken from the annual reports have been rounded off to two decimals of rupees in crores. The data available in financial statements have been translated in to a pre-designed structure format so that a meaningful interpretation could be made through inter-firm and intra firm comparisons. The format in which the data have been classified is selected after careful consideration of the operation Pharmaceutical Companies. Nevertheless, the limitations do in no way act as a deterrent in drawing effective and meaningful inferences from the studyAnalysis of the data: for knowing Comparative Financial statement Analysis & Innovation in Private sector Pharmaceutical Companies in India the commonly used ratio: fixed Gross profit, Net profit, Return on capital employed, Return on Net worth and Earning per share, Current ratio, Debtors Velocity (Days), Creditors Velocity (Days), Debt equity ratio and Interest coverage ratio, Inventory turnover Ratio, Debtors Turnover Ratio and Total Assets Turnover Ratio Analysis and interpretation: Table-1 Profitability Ratios of Dr Reddy's Laboratories Ltd & Lupine Ltd. Gross profit Net profit ROC RON EPS Year Dr. RDL Lupin Ltd. Dr.RDL Lupin Ltd. Dr. RD Lupin Ltd. Dr. RD Lupin Ltd. Dr. RD Lupin Ltd. 2001 22. 16 9. 25 19 6. 65 31. 5 23. 02 29. 23 31. 13 45. 32 201. 66 2002 33. 1 12. 49 32. 39 7. 54 42. 06 16. 64 45. 71 22. 07 59. 56 17. 42 2003 30. 78 12. 2 28. 34 7. 3 26. 44 16. 05 24. 02 20. 3 50. 6 17. 44 2004 21. 55 19. 07 20. 4 12. 48 15. 61 27. 1 14. 7 36. 14 36. 37 23. 76 2005 7. 9 9. 77 9. 19 6. 96 2. 19 12. 75 2. 77 17. 79 7. 85 20. 09 2006 16. 27 16. 29 14. 12 11 9. 24 20. 86 8. 57 31. 93 26. 82 44. 61 2007 37. 06 16. 27 32. 39 10. 53 35. 94 19. 39 35. 47 27. 89 69. 45 36. 75 2008 21. 63 19. 27 18. 47 13. 53 12. 01 23. 85 10. 35 32. 02 27. 2 52. 31 2009 21. 77 18. 28 17. 8 14. 17 13. 55 22. 29 11. 14 30. 97 32. 25 48. 22 2010 28. 77 21. 56 23. 52 17. 7 17. 79 25. 6 15. 14 33. 23 48. 25 70. 7 Total 240. 99 154. 45 215. 62 107. 86 206. 33 207. 55 197. 1 283. 47 404. 09 532. 96 Average 24. 099 15. 445 21. 562 10. 786 20. 633 20. 755 19. 71 28. 347 40. 409 53. 296 Min 7. 9 9. 25 9. 19 6. 65 2. 19 12. 75 2. 77 17. 79 7. 85 17. 42 Max 37. 06 21. 56 32. 39 17. 7 42. 06 27. 1 45. 71 36. 14 69. 45 201. 66 Sources: Data has been taken from annual reports The gross profit ratio of Dr. RDL was 22 . 16 % in 2001 which went down in to 7. 9% in 2005 but it rose up to 28. 7% in last years of the study period. The ratio ranged between 7. 9% in 2005 to 37. 06% in 2007. The ratio showed highly fluctuated trend during the study period. The average gross profit ratio was 24. 09% indicated. The gross profit ratio of Lupin Ltd. showed highly fluctuated trend during the study period with an average of 15. 45%. The ratio was the highest in the year of 2010 and very lowest 2001. T-test T-Test: Calculated value of gross profit ratio is 2. 86 Tabulated value at 5% significant value=1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is rejected. The Net profit ratio of Dr.RDL was 19% in the year of 2001 and increased to 32. 39% in the year of 2002. The ratio went down to 28. 34% in year of 2003. The ratio was very low of 9. 19% during the year of 2005 and very highest during the year of 2002. The average ratio was 21. 56% with fluctuated trend. The Net profit r atio of Lupin Ltd. was 6. 65 % in 2001 which went down in to 6. 96% in 2005 but it rose up to 17. 7% in last years of the study period. The ratio ranged between 6. 65% in 2001 to 17. 7% in 2010. The ratio showed highly fluctuated trend during the study period. The average gross profit ratio was 10. 78% indicated. T-testCalculated value of net profit ratio is 4. 01 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is rejected. The return on capital employed ratio was 31. 5% in 2001 which went down to 9. 24 % in the year of 2006 and also went down to 13. 55% and 17. 79 during the years of 2009 and 2010 respectively. The ratio ranged between 2. 19% in year of 2005to 42. 06% in the year of 2002. The ratio showed down ward trend with an average of 20. 63%. The return on capital employed of Lupin Ltd was showing much fluctuated trend during the year study period.The average ratio was 20. 76 in the Lupin Ltd which sho wed fluctuated trend during the study period. The ratio was 23. 02% in year of 2001 and 20. 86% in year of 2006 and 25. 6% during the last year of study period. The ratio has gone down due to decreased in volume of sales. The sales have gone down since price rise took place in market. T-test Calculated value of return on capital employed ratio is 0. 028 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is accepted. The Return on net worth ratio of Dr. RDL was 29. 3% in 2001 which went down in to 8. 57% in 2006 but it rose up to 15. 14% in last years of the study period. The ratio ranged between 2. 77% in 2005 to 45. 71% in 2002. The ratio showed highly fluctuated trend during the study period. The average gross profit ratio was indicated19. 71%. The Return on net worth ratio of Lupin Ltd. showed highly fluctuated trend during the study period with an average of 28. 347%. The ratio ranged between 17. 79% in 2005 to 36. 14% in 2004. T-test Calculated value of Return on net worth ratio is 1. 84 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance cal ; t tab Hence hypothesis is rejected. Earnings per share of Dr. RDL were Rs. 45. 32 in the year of 2001 and Rs 59. 56 in the year of 59. 56. The EPS went down to 50. 6 in the year of 2003 and Rs 36. 37 in the year 2004 and Rs. 7. 85 in the year of 2005. The EPS rose to 69. 45 in the year 2007and again went down to 27. 62 in 2008. The EPS Rs. 48. 25 during the last year of study period. The average ESP was 40. 41 with downward trend during the study period. The EPS was 201. 66 in Lupin Ltd. and went down to 20. 09 in the year of 2005 and reached down to 70. 7 during the last year of study period.The EPS showed lower level of EPS due to less utilization of financial leverage. T-test Calculated value of Earnings per share is 0. 70 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of s ignificance t cal ; t tab Hence hypothesis is accepted. Table-2 Liquidity ratio of Dr. RDL and Lupin Ltd. Current ratio Debtors Velocity (Days) Creditors Velocity (Days) Year Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. 2001 1. 69 1. 82 48 47 76 27 2002 3. 09 1. 74 54 61 79 35 2003 4. 86 1. 58 60 62 82 36 2004 3. 73 1. 34 60 66 85 38 2005 2. 49 1. 1 60 56 90 34 2006 1. 5 1. 38 59 57 94 35 2007 2. 21 1. 68 66 63 105 38 2008 3. 05 1. 53 85 69 109 42 2009 3. 15 1. 24 79 77 110 45 2010 2. 44 1. 27 100 81 120 52 Total 28. 56 14. 68 671 639 950 382 Average 2. 856 1. 468 63 62 92 37 Min 1. 69 1. 1 48 47 76 27 Max 4. 86 1. 82 100 81 120 52 Sources: Data has been taken from annual reports In year 2001 Dr. RDL has 1. 69 as its current ratio and after that it continuously increased from 3. 09 to 4. 86 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negative changes but it moves from 2. 21 to 3. 05 in year 2007 and 2008 respectively.In the yea r 2009 and 2010 it shows again little fluctuated with an average of 2. 85. In year 2001 Lupin Ltd has 1. 82 as its current ratio and after that it continuously decreased from 1. 74 to 1. 58 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negative changes but it moves down from 1. 68 to 1. 53 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuated with an average of 1. 46. T-test Calculated value of current ratio is 4. 50 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance cal ; t tab Hence hypothesis is rejected. In year 2001 Dr. RDL has 48 days as its Debtors Velocity (Days) and after that it continuously increased from 54 (Days) to 60 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negative changes but it moves down from 66 days to 85 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctua tions with an average of 63 days. In year 2001 Lupin Ltd. has 47 days as its Debtors Velocity (Days) and after that it continuously increased from 61 (Days) to 62 in the year of 2002 and 2003 respectively.But in year 2004, 2005 & 2006 it also showed negative changes but it moves up from 63 days to 69 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 62 days. T-test Calculated value of Debtors Velocity (Days) is 0. 3 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is accepted. In year 2001 Dr. RDL 76 days as its Creditors Velocity (Days) and after that it continuously increased from 79 (Days) to 82 in the year of 2002 and 2003 respectively.But in year 2004, 2005 & 2006 it also showed negative changes but it moves down from 105 days to 109 days in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with a n average of 92 days. In year 2001 Lupin Ltd. 27 days as its Creditors Velocity (Days) and after that it continuously increased from 35 (Days) to 36 days in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed positives changes but it moves down from 38 days to 42 days in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 37 days.T-test Calculated value of Creditors Velocity (Days) is 10. 83 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is rejected. Leverage Ratios of Dr. RDL & Lupin Ltd. Table-3 Leverage Ratios of Dr. RDL & Lupin Ltd. Debt equity ratio Interest coverage ratio Year Dr. RDL Lupin Ltd. Dr. RD Lupin Ltd. 2001 0. 56 1. 79 5. 05 2. 09 2002 0. 19 1. 88 34. 27 2. 55 2003 0. 01 1. 77 72. 27 2. 53 2004 0. 02 1. 24 72. 71 4. 89 2005 0. 08 0. 86 3. 82 4. 12 2006 0. 28 1. 18 10. 39 8. 6 2007 0. 19 1. 16 27. 29 8. 65 2008 0. 09 0. 83 40. 74 13. 99 2009 0. 11 0. 71 27. 62 2. 35 2010 0. 11 0. 47 68. 8 25. 97 Total 1. 64 11. 89 362. 96 85. 74 Average 0. 16 1. 19 36. 30 8. 57 Min 0. 01 0. 47 3. 82 2. 09 Max 0. 56 1. 88 72. 71 25. 97 Sources: Data has been taken from annual reports The Debt equity ratio of Dr. RDL was 0. 56 in 2001 which went down in to 0. 28 in 2006 but it went down to 0. 11 in last years of the study period. The ratio ranged between 0. 01 in 2003 to 0. 56 in 2001. The ratio showed highly fluctuated trend during the study period. The average Debt equity ratio was indicated 0. 16. In year 2001 Lupin Ltd. 1. 79 as its Debt equity ratio and after that it continuously decreased from 1. 8 to 1. 77 days in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed positives changes but it moves down from 1. 16 to 0. 83 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 1. 19 days. T-test Calc ulated value of Debt equity ratio is 6. 28 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is rejected. Interest coverage ratio of Dr. RDL was 5. 05 in the year of 2001 and Rs 3. 82 in the year of 2006. The Interest coverage ratio went up to 72. 7 in the year of 2003 and 72. 71 in the year 2004 and 3. 82 in the year of 2005. The Interest coverage ratio rose to 27. 29 in the year 2007and again went up to 40. 74in 2008. The Interest coverage ratio was 68. 8 during the last year of study period. The average Interest coverage ratio was 36. 30 with upward trend during the study period. In year 2001 Lupin Ltd. 2. 09 as its Debt equity ratio and after that it continuously decreased from 2. 55 to 2. 53 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed negatives changes but it moves down from 8. 65 to 13. 99 in year 2007 and 2008 respectively.In the year 2009 and 2010 it shows aga in little fluctuations with an average of 8. 57. T-test Calculated value of Interest coverage ratio is 3. 13 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is rejected. Table-4 Turnover ratio of Dr. RDL and Lupin Ltd. Inventory Turnover Ratio Debtors Turnover Ratio Total Assets Turnover Ratio Year Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. Dr. RDL Lupin Ltd. 2001 8. 65 11. 3 4. 76 5. 39 1. 03 1. 6 2002 9. 01 6. 61 4. 29 3. 06 0. 99 1. 32 2003 7. 44 7. 02 3. 64 2. 75 0. 92 1. 29 2004 6. 99 6. 74 3. 97 3. 89 0. 88 1. 7 2005 5. 79 5. 23 3. 78 5. 37 0. 85 1. 31 2006 5. 64 5. 95 4. 21 5. 69 0. 82 1. 28 2007 8. 69 5. 7 4. 94 4. 9 0. 75 1. 14 2008 6. 11 5. 08 3. 53 4. 7 0. 65 1. 09 2009 6. 16 4. 39 3. 66 4. 39 0. 64 0. 99 2010 5. 57 5. 13 3. 66 4. 51 0. 59 0. 94 Total 70. 05 63. 15 40. 44 44. 65 8. 12 12. 23 Average 7. 005 6. 315 4. 044 4. 465 0. 812 1. 223 Min 5. 57 4. 39 3. 53 2. 75 0. 59 0. 94 Max 9. 01 11. 3 4. 94 5 . 69 1. 03 1. 6 Sources: Data has been taken from annual reports In year 2001 Dr. RDL 8. 65 as its Inventory Turnover Ratio and after that it continuously decreased from 9. 01 to 7. 44 in the year of 2002 and 2003 respectively.But in year 2004, 2005 & 2006 it also showed negatives changes but it moves down from 8. 69 to 6. 11 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 7. 01. In year 2001 Lupin Ltd. 11. 3 as its Inventory Turnover Ratio and after that it continuously increased from 6. 61 to 7. 02 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with ups and downs but it moves down from 5. 7 to 5. 08 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 6. 2. Calculated value of Inventory Turnover Ratio is 0. 72 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hypothesis is accepted. In year 2001 Dr. RDL. 4. 76 as its Debtors Turnover Ratio and after that it continuously decreased from 4. 29 to 3. 64 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with upward movements but it moves down from 4. 94 to 3. 53 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 4. 04.In year 2001 Lupin Ltd. 5. 39 as its Debtors Turnover Ratio and after that it continuously decreased from 3. 06 to 2. 75 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with upward movements but it moves down from 4. 9 to 4. 73 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 4. 47. Calculated value of Debtors Turnover Ratio is 1. 21 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hy pothesis is accepted. In year 2001 Dr. RDL. 1. 3 as its Total Assets Turnover Ratio and after that it continuously decreased from 0. 99 to 0. 92 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with downward movements but it moves down from 0. 75 to 0. 65 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 0. 81. In year 2001 Lupin Ltd. 1. 6 as its Total Assets Turnover Ratio and after that it continuously decreased from 1. 32 to 1. 29 in the year of 2002 and 2003 respectively. But in year 2004, 2005 & 2006 it also showed trend with upward movements but it moves down from 1. 4 to 1. 09 in year 2007 and 2008 respectively. In the year 2009 and 2010 it shows again little fluctuations with an average of 1. 22. Calculated value of Total Assets Turnover Ratio is 5. 34 Tabulated value at 5% significant value= 1. 73 d. e. f. = 18 at 5% of level of significance t cal ; t tab Hence hyp othesis is rejected. Summary findings and Conclusion The liquidity ratio of Lupin Ltd is highly threatening when compared with Dr. RDL. Thus Lupin Ltd has to control the current liabilities or to increase the current assets so that they can cover all the current liabilities and be in safer position.Thus slightly fluctuations in sales in that situation can not affect the paying capacity of the concern and thus maintain the credibility. The profitability ratio of Dr. RDL is better when it is compared with Lupin Ltd. It can be inferred from the result that Lupin Ltd can expand the business or can move further in newer directions as it is experiencing continuously growth in the profitability. Lupin Ltd has to give a fairer thought to reduce cost in providing services and increasing the turnover so that sustained growth in profitability can be seenReturn on Net Capital Employed is the best test of overall profitability and efficiency of the business firm. A company with high rate of retu rn on capital employed would be in a position to capitalize; e. g. it can take advantage of all favorable market opportunities. The study shows that returns on capital employed in selected units in India had marked a fluctuated trend. The average was 17. 79 and 25. 6 percent in units in India respectively. This ratio was satisfactory. On the whole Dr. DRL had the highest return net on capital employed of As compared to the Lupin ltd.In the light of the above discussion it is suggested that Lupin ltd should undertake cost control measure so that increase net profit before interest and taxes of the company might enhance the return on net capital employed. The solvency ratio also reveals the same track record of an upper hand over Lupin ltd. This position depicts the financial soundness or good financial health of the DR. RDL. In this sector Lupin ltd. has to work hard for providing the financial health in terms of capital also. The turnover ratio of Lupin Ltd. is showing better positi on when compared to DR. RDL. This fact proves that the market size in Lupin Ltd. s far more better than the DR. RDL which in turn is gearing its growth in all the stream. Thus DR. RDL has to work for increasing the market size and customer base so that it can achieve the trend of continuous growth. It can be inferred from the overall financial analysis that Lupin Ltd ltd. has to rethink and device the strategies so that it can lead towards positive way and become the major players. Innovation though financial statement analysis can be seen though mergers and acquisitions and launching of new products and schemes so that enterprise can be proud of being major market players and setter newer and newer goals in the future.Cost accounting and cost audit should be made mandatory for this units and cost sheet along with annual financing statement should be prepared. The policy of borrowed financing in selected Parma group of companies under study was not proper. So the companies should us e widely the borrowed funds and should try to reduce the fixed charges burden gradually by decreasing borrowed funds and by enhancing the owner’s fund. For this purpose companies should enlarge their equity share capital by issuing new equity shares. There has been too much of government interference in policy and day-to-day working and decisions.This leads to delays in decision-making. This should be abolished. There is no incentive to the employees to perform better. Also there is no accountability because no one is held responsible for a failure in achieving targets for this kind of problem responsibility centre should be created. Improper planning and delays in implementation of projects lead to rise in their cost. So properly planning should be made. To regularize and optimize the use of cash balance proper techniques may be adopted for planning and control of cash. 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Information about this Article Peer-review ratings (from 2 reviews, where a score of 100 represents the ‘average’ level): Originality = 175. 00, importance = 162. 50, overall quality = 16 2. 50 This Article was published on 14th March, 2012 at 18:41:24 and has been viewed 2635 times. This work is licensed under a Creative Commons Attribution 2. 5 License. The full citation for this Article is: Kakkad, R. (2012). Comparative Financial statement Analysis & Innovation in Private sector Pharmaceutical Companies in India-An empirical Analysis. PHILICA. COM Article number 318.