Analysis of Profitability Ratios to Evaluation of Performance of Indian Automobile Industry

Profitability measures are important tools to use of company’s managers and owner alike. Profitability ratios show a company’s overall efficiency, health and performance. Financial performance analysis clarifies strengths and weaknesses of the company in terms of amount and importance. This study analyzes the profitability ratios to evaluation of performance of Indian automobile industry. The objective of the study is to analyze the financial performance of the selected Automobile companies with regard to various profitability indicators. The study intends to examine ROA, ROE, ROS and Operating Ratio in automobile industry over a period of 7 years from 7007-8 to 7012-11. The sample units have been selected from CNX auto INDEX of Bombay Stock Exchange as A group companies. The analysis of regression coefficients reveals that ROA, ROE, ROS and Operating Ratio have no control over Share price.

Keywords:

Financial Performance , Return on Assets , Return on sales , Return on Equity share holders , Operating Ratio