Main Article Content
The aim of performing this research is to find out financial ratios impact on financial performance of GATM and NML to evaluate which company is performing better.. This research was important because of the problems, they both are competitors and the investor should what are their positions and performance it is important for the companies too through which they can identify which ratios to be considered while evaluating financial performance. For the purpose of this research, I collected the data of 2 companies GATM and NML from Standard capital security website and from firm’s annual reports for the period starting from 2003 to 2017. Furthermore, I considered two measures of financial performance, which are return on asset. and return on equity. I also considered liquidity position which is measured by current ratio, quick ratio, total asset turnover, fixed asset turnover, inventory turnover) and solvency position by debt to equity debt to total asset and interest coverage ratio, which according to previous researches and conditional theories have adequate impact on financial performance. The findings of this research suggest that current ratio, quick ratio and inventory were the major determinant of liquidity and for no determinant has significant impact and the researches should consider other variable than studied for solvency. The result also shows that both companies are performing better but NML liquidity position is better than NML also both companies ROE and fixed asset turnover shows insignificant difference rest are significant.
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
Alam, I. (2011, March). Impact of financial crisis on textile industry of pakistan.
Hingorani, N., & Ramanathan, A. (1973). Management Accounting. New Delhi: S. Chand & Sons.
Ho, C.-T., & Wu, Y. S. (2006). Benchmarking performance indicators for banks. Benchmarking, 13(1/2), 147-159.
Horne, J. C., & Wachowicz, J. M. (2001). Fundamentals of Financial Management. Prinsip-prinsip Manajemen Keuangan, 12.
Jan, O. (2011). Financial Ratio Analysis on Accounting Explained.
L., G., & Zutter, C. (2012). Principles of Managerial Finance. Harlow: Pearson Education Limited.
Mullah, M. A. (2003). Forecasting the Viability and Operational Efficiency by use of ratio analysis. Finance India, 17(3), 893-897.
Noel Capon, J. U., & Hoening, S. (1990). Determinants of Financial performance (Vol. 36).
Owens., & Epstein. (1995, October). FW's Growth 100. Financial world, 54-55.
Parsad, K. M. (2011). Financial characteristics of indian pharmaceutical industry. A multi variate analysis. Asia Pacific Journal of Research in Business Management, 2(11), 1-15.
Rashid, M. Z., & Johari, J. (2003). The influence of corporate culture and organization commitment on performance. Journal of Managemnt Development, 22(8), 708-728.
Riyanto, B. (2001). Dasar-Dasar Pembelanjaan Perusahaan, Edisi Keempat.
Sorensen, B. J. (2002). The strength of corporate culture and the reliability of firm performance. Administrative Science quarterly, 47(1), 70-91.
Thachappilly, G. (2009). Liquidity Ratios Help Good Financial Management: Liquidity Analysis reveals likely Short-Term Financial Problems. Journal of liquidity ratio analysis.
Thachappilly., G. (2009). Profitability Ratios Measure Margins and Returns: Profit Ratios Work with Gross, Operating, Pretax and Net Profits. Journal of profitability ratio measure margin and return.
Vanitha, S., & Selvam, M. (2010). Financial performance of Indian manufacturing companies during pre and post-merger. International research journal of finanace and economics, 20(12), 7-35.
Clausen, J. (2009). Asset Turnover Ratio: Inventory, Cash, Equipment and Accounts Receivable Analysis. Journal of asset turnover ratio .
Mtetwa, M. (2010). Fixed Assets: Capital Expenditure. Journal of fixed assets in accounting .