Fmcg ratio analysis

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We are presenting ratio analysis of companies from
FMCG: Food and beverages sector
2

ABOUT FOOD SECTOR
• The food industry is a complex, global collective of
diverse businesses that supplies most of the food consumed by the world
population.
• Broadly, the food industry comprises a complex network of activities
pertaining to the supply, consumption, and catering of food products
and services across the world. Finished food products and partially
prepared ‘instant’ food packets are also a part of the food industry.
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BRITANNIA
• Britannia Industries is one of India’s leading food companies with a
100 year legacy and annual revenues in excess of Rs. 9000 Cr.
Britannia is among the most trusted food brands, and manufactures
India’s favorite brands like Good Day, Tiger, NutriChoice, Milk Bikis and
Marie Gold.
• Britannia products are available across the country in close to 5 million
retail outlets and reach over 50% of Indian homes.
• Britannia Bread is the largest brand in the organized bread market
with an annual turnover of over 1 lac tons in volume and Rs.450 crores
in value. The business operates with 13 factories and 4 franchisees
selling close to 1 mn loaves daily across more than 100 cities and towns
of India.
5

NESTLÉ
• NESTLÉ India is a subsidiary of NESTLÉ of Switzerland. With eight
factories and a large number of co-packers, Nestlé India is a vibrant
Company that provides consumers in India with products of global
standards and is committed to long-term sustainable growth and
shareholder satisfaction.
• Nestlé is the world’s largest food and beverage company. It has more
than 2000 brands ranging from global icons to local favourites, and it
is present in 191 countries around the world.
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KELLOGG’S
• Kellogg's, is an American multinational food manufacturing company.
• Kellogg's produces cereal and convenience foods, including cookies,
crackers, toaster pastries, cereal bars, fruit-flavored snacks, frozen
waffles, and vegetarian foods.
• Kellogg's products are manufactured in 18 countries and marketed in
over 180 countries.
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Coca-Cola COmpany
• details
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“Quotations are commonly printed
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invoke philosophical thoughts
from the reader”
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Current RAtio
Kelloggs CocaCola Mondelez Britannia Nestle
2018 0.70 1.05 0.45 1.91 0.95
2017 0.67 1.34 0.48 1.74 0.83
2016 0.66 1.28 0.59 1.30 0.85
12
Britannia is in a better position to cover its Current Liabilities with its
current Assets, compared to other three companies.

Quick RAtio
2018 0.40 0.95 0.30 1.52 0.74
2017 0.40 1.25 0.31 1.25 0.59
2016 0.38 1.18 0.42 0.96 0.63
13
Britannia is in a better position with Liquid assets compared to other three
companies. In 2017 both Britannia and CocaCola were in better position.

Debt Equity RAtio
2018 2.76 2.02 0.61 0.05 0.69
2017 3.76 2.32 0.63 0.04 0.48
2016 3.81 1.81 0.62 0.06 0.35
15
Britannia is fairly a debt free company compared to other three companies.

Debt to Total Assets Ratio
2018 0.66 0.71 0.34 0.05 0.43
2017 0.70 0.73 0.35 0.04 0.31
2016 0.69 0.69 0.33 0.06 0.25
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Britannia is fairly a debt free company compared to other three companies.

Interest Coverage Ratio
2018 5.94 9.47 7.55 201.05 16.77
2017 5.42 9.04 8.72 240.27 16.59
2016 3.65 11.81 5.28 249.10 24.24
18
pending

DSCR
2018 18.03 18.69 24.83 11.39 26.58
2017 17.76 4.20 20.15 11.24 25.56
2016 14.29 16.98 14.30 10.16 38.20
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Nestle is better Debt Service Coverage Ratio compared to others which implies
that it can service its Debt + Repayment + Rentals, better than others

INVENTORY TURNOVER
2018 6.93 4.34 6.05 9.29 5.03
2017 6.64 4.97 6.31 10.14 5.19
2016 6.54 5.90 6.23 11.84 5.34
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Britannia has better Inventory Turnover Ratio compared to others, which
implies that it is better able to convert its inventories into sales.

INVENTORY HOLDING PERIOD
2018 52.70 84.06 60.29 39.27 72.50
2017 54.94 73.39 57.83 35.99 70.40
2016 55.84 61.82 58.58 30.84 68.35
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Britannia has least Inventory Holding Period compared to others, which
implies that Britannia is better able to turn its Inventory into sales
compared to others.

DEBTORS TURNOVER RATIO
2018 9.80 9.02 7.94 40.64 7.88
2017 9.81 9.41 7.40 51.25 7.33
2016 10.07 10.74 7.09 56.18 7.26
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Britannia has better Debtors Turnover Ratio, which implies that Britannia is
better able to collect the money which was extended as credit sales.

DEBTORS COLLECTION PERIOD
2018 37.24 40.46 45.96 8.98 46.31
2017 37.20 38.77 49.30 7.12 49.80
2016 36.25 33.99 51.51 6.50 50.31
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pending

CREDITORS TURNOVER RATIO
2018 3.37 4.53 2.71 6.97 2.51
2017 3.20 4.90 2.88 7.32 2.43
2016 2.92 5.74 3.10 6.88 2.48
25
pending

CREDITORS PAYMENT PERIOD
2018 108.45 80.49 134.64 52.34 145.24
2017 113.93 74.51 126.82 49.87 150.15
2016 124.86 63.61 117.77 53.05 147.27
26
pending

GROSS PROFIT MARGIN
2018 0.35 0.63 0.40 0.38 0.50
2017 0.37 0.63 0.39 0.38 0.49
2016 0.37 0.61 0.39 0.42 0.51
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CocaCola has better gross profit margins compared to others, which implies
that CocaCola is better able to manage its Direct cost compared to others.

OPERATING PROFIT MARGIN
2018 0.13 0.27 0.13 0.16 0.15
2017 0.11 0.21 0.13 0.15 0.11
2016 0.11 0.21 0.10 0.14 0.15
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CocaCola has better OPM compared to others, which implies that it is better
able to manage its operating expenses compared to others.

NET PROFIT MARGIN
2018 0.10 0.20 0.13 0.10 0.11
2017 0.10 0.03 0.11 0.10 0.08
2016 0.05 0.16 0.06 0.09 0.10
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Net Profit Margin of CocaCola is better than others, which implies that it
is better able to manage the non operating expenses (Indirect Costs)
compared to others. In 2017 Mondelez had better NPM.

Return On Capital Employed
2018 0.12 0.12 0.05 0.32 0.11
2017 0.09 0.03 0.06 0.35 0.08
2016 0.12 0.11 0.05 0.43 0.09
31
Britannia has better ROCE compared to others, which implies that it is
better able to use its Capital Employed to earn Non Operational PAT.

Return On Equity
2018 0.50 0.34 0.13 0.33 0.17
2017 0.61 0.05 0.11 0.37 0.11
2016 0.34 0.27 0.06 0.45 0.13
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Kellogg’s has better ROE compared to others, which implies that Kellogg’s is
able to generate better value for shareholders as against its equity, compared
to others.

ROA
2018 0.11 0.11 0.07 0.32 0.11
2017 0.11 0.02 0.06 0.36 0.08
2016 0.07 0.11 0.03 0.43 0.09
33
pending

P/E RATIO ( Price to Equity)
2018 14.17 31.57 21.04 37.36 28.19
2017 15.16 163.28 25.93 42.38 41.00
2016 27.55 31.78 46.13 46.50 34.44
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Britannia has a higher P/E Ratio compared to others, which implies that
investors are willing to pay more premium for a share of Britannia compared
to others. In 2017 CocaCola had higher P/E Ratio.

P/BV RATIO ( Price To Book value)
2018 7.23 10.68 3.72 10.97 4.90
2017 10.41 10.73 3.67 13.89 4.60
2016 11.85 8.77 3.80 17.91 4.33
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Britannia has a better P/BV Ratio compared to others, which implies that
investors are willing to pay more premium for Britannia compared to others.

DIVIDEND YIELD Ratio
2018 4.05 3.29 2.00 0.85 2.49
2017 3.91 3.13 1.71 0.77 2.49
2016 3.76 2.96 1.50 0.62 2.43
37
Kelloggs has the highest DYR, which implies that Kelloggs pays a better
dividend with regards to its market price, compared to others.

PAYOUT RATIO
2018 57.44 104.00 42.11 83.56 70.23
2017 59.22 510.34 44.32 31.62 102.18
2016 103.55 93.96 69.23 32.60 83.56
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CocaCola has the highest Dividend Payout Ratio, which implies that it pays a
far better dividend as regards its earning per share, compared to others. In
2016 Kelloggs had highest Dividend Payout Ratio.

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Fmcg ratio analysis

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