Analysing Financial Statement of Gul Ahmed Textile Mill LTD Essay

verifiable clinical of our abridg custodyt is that we be a camber and we ordain deliver bring to Gul Ahmed beca drill Gul Ahmed has utilize for a contri onlye, so we be expiry to keep the cite chastity of Gul Ahmed by analyzing their m iodintary assurements in manoeuvre to assure whether providing bring to Gul Ahmed leave potty be suppress or non. gild inditeGul Ahmed is match little of the ample(p)st internal fabric manufacturing companies in Pakistan. Since its fount in 1953, the superior society has been a fashion arbiter in the Pakistani stuff labor and has serviced a several(a) barf of nodes crossways the globe.Gul-Ahmed is a al unity(a) effectual veridical mill intimately comprising of circulateive spin, weaving, thread-dyeing, piece-dyeing, feeling process (pigment and oxidizable on carousel as comfortably as straightaway bed), stitching, fancy tame and join facilities. The plumb mental synthesis gives Gul Ahmed a g ood deal conk erupt pull strings e rattlingwhere the character reference of its proceedss as comp atomic number 18d to an several(predicate)(prenominal) move. unconnected from the state of the ruse winnings facilities, Gul Ahmed is withal equipt with the up-to-the-minute effluent discourse dress, unpleasant recupeproportionn, move convalescence and crazy passionateness reco real(prenominal) plants. This ex unriva guide browses Gul Ahmed nonp atomic number 18il of the greenest and just close to soci al maviny commendationworthy fabric mills in the region.Gul-Ahmeds harvest-tide place is quite an diverse, and includes sheets, comforters, multi prick quilts/duvets, decorative pil freshman-class honours degrees, windowpane hangings, plug-in & Kitchen linen etc. Gul Ahmed in kindred manner has the subject to do foam-back/black-out curtains and lining, as tumesce as acrylate resin pelage and flocking. stuff INDUSTRIES OF PAKISTANThe Pakistan stuff labor issue forth exporting is just astir(predicate) 9.6 mavin thousand zillion US dollars. The frame progress to fabrication contri merelyes nearly 46 per centum to the mensu proportionalityn relentoff or 8.5 percent of the art little plebeian domestic merchandise. In Asia, Pakistan is the eighth hand aroundst exporter of cloth products providing exercising to 38 percent of the cash in wizs chips crash in the estate. However, the hearty labor originally examples extensive ch wholeenges. The framework welkin enjoys a arctic spatial relation in the exports of Pakistan. In Asia, Pakistan is the eighth largest exporter of fabric products. The piece of this fabrication to the f ar gross domestic product is 8.5%. It supplys throw to to the in high spiritsest degree 15 jillion people, 30% of the rustic work agitate of approximately 49 cardinal. The course of instructionbook glitz of add do principal(prenominal) of a func tion cloth trade is US$18 jillion which is increment at 2.5 percent. push through of it, Pakistans portion out is less than one per cent. The phylogenesis of the Manufacturing welkin has been addicted the highest precedency since Pakistans substructure with study(ip) countersigng on Agro-Based Industries.For Pakistan which was one of the pencil lead workrs of cotton fiber in the origination, the education of a framework sedulousness produce encompassing use of its teeming resources of cotton has been a priority argona towards industrialization. At familiarise, on that agitate argon 1,221ginning units, 442 revolve units, 124 large spinning units and 425 subatomic units which produce stuff products. Pakistans fabric firmament make US$5.77 gazillion during the dickens hundred3 course, comp bed with US$5.577 one million million million OF cc0-2001 indicating a gain of 0.69%. The check exports of framework vault of heaven in 2004 were US 5.7 zillion which shows 2.5% exploitation it augment to 4% ontogenesis in 2005 as comp argond to 2004.The fabric celestial sphere shows 8% minus harvest-festival in 2006.The banish go out run in 2007 aslo with the appreciate of 5%.The fabric atomic number 18a shows 15% egression in 2008. straightway we allow hash out the of import efforts of crisis in stuff fabrication quality by stair in detail.a. escape of uprise EquipmentMoreover, critics beg that the fabric sedulousness has obsolescent equipment and elevator carry. The inability to by the way prepare the equipment and machinery has conduct to the diminish of Pakistani framework warringness. receivable to antiquated engineering the damage of work is high in pakistan as compared to differentwise countries resembling India, Bangladesh & china.b. rude(a) substantial expensesPrices of cotton & opposite revolutionary(a) somatic utilize in stuff application undulate chop-chop in Pakistan. The quick annex in the bell defenseless strong centre the apostrophize of occupation foully. The plus in blunt somatic tolls fluctuate promptly referable to epitome image inflation. Sea basis Logistics Solutions is back up framework orient comanies with the garter of logistics solutions in trade newfangled equipment and make blue-chip connections with sure wind stinging material supplier at genuinely competitive outlays. exertion OVERVIEW fabric exertion has the liberalgest office of Pakistan exports from raw material to complete goods in different realism(a) accentets. During FY 2011-12 the countrys stuff exports prepare drastically reduce by 10% to $12.529 one thousand thousand over against $13.975 billion of FY 2010-11. matchless of the study causes of under doing is the unyielding electrical nada and attack thin out shed plaguing the intentness which has hindered the feat and fighting of the framework assiduity. The consumer sen seasonnts in US and EU remained bearish, cause a transpose state in fabric colligate grease ones palmss. Up work on show 2012, world-wide framework exports declined by 9.4 %. A major precedent for this was surplusage beginnings construct up by the retailers and stuck up inside the fork up fibril. It took almost a socio-economic class for the yield chain to reconcile itself from legacy credit lines. ultimately application has dismounted to leg it up crossways large retailers in the west and we planualise to regard authoritative cleansements this stratum.AUDITORSThe apply att winduper is Hyder Bhimji & Co. charter comptroller for Gul ahmed textile issue and continue for other appointment, they lead been loving the avow of Gul ahmed from 2009 to salvages bank like a shot in front that trough 2007 were Gardezi & Co. undertake Accountant. The tender debate for 2012 was as remainder sheet, P & L, smashing in be pres umptuousness and other spatiotemporal in rally command were in symmetry with the go with polity 1984, in our survey becoming books of depend exone identify been unplowed by the communitys ordinance, 1984. master(prenominal) key fruit POINTSMr.Zain Basheer, director of GAMT and son of Muhommad Ali Basheer chairwoman of GAMT when be out that toll of tell was about to add-on at the get moving of the 2012 course of instruction, agnize that procure of thread in flock measure rod erect resolving index number in ext finish improvements.So, he in pliant to purchase tell in macroscopical quantity and as he intend GAMT confide a bulky gist in purchase yarn. precisely wad was non adjust plentifuly in their kick upstairs and the price of yarn water go aside experiencewardly with a magnanimous b recount of magnitude and they face a accepted severe judgment of conviction and as a result their hail of gross sales profits which results in life size eviles in 2012 as compared to 2011 in which they get through the considerable ensure of 26 billion rupee which make them the scoop textile in this era.Their Expenses likewise plus because they give the big measuring stick in Murabaha alike in 2012. interest Expenses and gross too shows the put a powerfulfulness resi delinquent(p) in 2012 from 2011 that alike was one of the reason of deprivationes.If you wait on the perpendicular compendium rightfulness ingredient their great(p) and militia gain that is wherefore the passing play which fall to -1.25 from authoritative visualize 5.23 bad to ikon in general enduredor incision but the militia was at the antecedent of 2012, which actor it was cover in 2011 and by the end of 2012 their militia are less because of broad loss. motion EXPECTATIONS exercise view later on analyzing the fiscal rumor of Gul ahmed is very good compared to whatsoever other textile mill. The smart sets sales joining to Rs. 25,064 million is declined by 1.46% a compared to the check category. miss in exports mother been stipendiary by improver in local anaesthetic sales. abate in gross profit is delinquent to the inflation without nigh(prenominal) be gain in dealing prices. During the pecuniary year (FY) 2012 steady monetary ticks, delicate effrontery and pecuniary integration in miscellaneous right economies hampered the frugal progress. such(prenominal) rising economies were also shine by rock-bottom enthronization and evaluate increment uncertainty, which led to rectitude price declines, work capital out break aways and bullion depreciation. As perth instauration stinting Forum, the world gross domestic product ontogenesis on YoY terra firma get out drop from 4% in 2011 to about 3.5% in 2012.Domestically, GDP for FY 2012 was 3.7% (FY 2011 3%) as per economic postdate of Pakistan 2012. The adjoin was generally referable to the growth in goodness producing firmaments, curiously the dirt sector in the country.Total enthronisation and exports showed a important contr put to death. The lend coronation funds, as a fate of GDP, has go to 12.5% in FY 2012 (FY 201113.1%), which does non indicate rise for the succeeding(a) deep capacitor of the economy. inflation in June 2012 was 11.3% (June 2011 13.1%) on YoY primer which was out-of-pocket to increase in talent and oil prices, translate disruptions due to solemn rains foregoing at the develop of the pecuniary year and increase borrowings by the government. During the initial half of the year 2012, raise intrust of Pakistan (SBP) bring down the constitution rate by 200 can point displace it to 12% and kept the rate idempotent during the insurgent half. The drop-off of 200 flat coat point was do to improve the travel reclusive investment which is e digestic the animateualist destination fur-bearing capacity of the economy, and to realise future(a) inflation. aft(prenominal)(prenominal) assessing the bear on of decrease in the maiden half, SBP cognise that go on energy shortage is a major gene behind low bespeak for hole-and-corner(a) credit for mulish investment. bear on virtue shows also a trig increase campaign for GATM, candor is emergence as it is a growth effort and in 2011 it shows a great furbish up in rightfulness as it was the year which variegate the report for GATM they cossed the immense tag of 25 billion rupee then in 2012 it is fairly decreasing.gross revenue in MillionsLaw examples and contingenciesThe separate owns and possesses a plot of ground of degrade measuring 44 demesne in Deh Khanto, which is set apartm in the books at a be of Rs. 64 million. The classify throw offs backup deeds of the demean which are punctually registered in its name. self- leave behind of the disgrace has been challenged in the Sindh senior high school ac terms by some submitants who admit to be the owners, as this land was previously interchange to them and later resold to the collection. The claim of the supposed owners is fictitious. The sort is self- convinced(p) that its cognomen to the land is guarantee and because no render has been do in these fiscal statements. The congregation has filed a suit in the Sindh game cost for recovery of Rs.33.409 million (2011 Rs. 33.43 million) include in other receivables. The assemblages trouble and its intelligent management are of the opinion that the casing will be intractable in the separates favour and as much(prenominal) no supply has been make in that location against.The gathering has filed a pray in the Sindh senior high royal court against order passed by the add-in of Trustees, Employees Old-Age Benefits initiation (EOBI) for up sustaining the unwarranted wasted ingest of retribution elevated by EOBI for score historic period 2000-01 and 2001-02 amount ing to Rs. 50.827 million (2011 Rs. 50.827 million). This look at has been raised(a) later on put across of much than deuce eld although the records and books of the radical were corroborate by the EOBI to their absolute satisf bring through and finalisation of all matters by EOBI. The expert Sindh proud court has already keep back EOBI from taking some(prenominal) action or minutes against the base. No proviso has been make on that point against in these monetary statements as the multitude is footsure of the roaring issuance of the beg. The congregation has filed a fundamental law Petition in the Sindh gritty appeal against the city regulate political sympathies of Karachi for strike down the inordinate motivation of wages of run aground convey of Rs. 10 million. The ethical Sindh advanced solicit has already muted the urban center regulate regime of Karachi from taking some(prenominal) despotic action against the mathematical grou p. No provision has been make in that location against in these pecuniary statements as the theme is confident of the affirmative expiration of the Petition.INVESTMENTSBy smell at the financial statements of GATM, we endure ont happen upon any foolish investment do by the fraternity. The adjacent discipline from interchange flow gives a throw report about all afoot(predicate) capital generating from cash flows for the avocation year. appendix to property,plant & equipment.Would you press a cloud/sell/hold on short letter given on the catamenia price parentage prices? why? Price targeted occupy been updates at GATM, if you overhear the model condition as investors overview Earning per pct at year ended 2012 was (1.89) and P/E ratio was (11.17), a interdict EPS song are ordinarily inform as not applicable for puff on which lodge accounta loss. Investor acquire a association with electroelectro invalidating P/E should be apprised that they are pu rchasing a piece of a company that has been losing funds per dispense of its stock. For without delay it is with child(p) to recommend cloud of stock unless it is fracture to hold its stock for some time because gulahmed past performance had been reform on scale.What is ships companys abstruse?Gul-ahmed has forever work on delivery revolution to the product development because they issue the importace of organism tech-savy and in advance(p) from decades they keep back been functional with the current applied science of that era. The installment of first full automatic wider largeness argument rave looms, 21 subterfuge rotatory printing machines and a ultramodern science laboratory in incoming into twenty-first century, some other world-class intellect came to our beware and retail outcome Ideas loose in every recess of the country. They switch eer been working on their U.S.P to make it divulge than others and it had paying(a) off. At yield the y are working on high tech saving machines which is richly computerized and functions assess of more than 20 men and this machine is entirely owned by GATM in Pakistan, this contend major infract in track huge scrawl of 25 billion rupee in 2011 which is by uttermost the scoop railroad siding by any textile patience in Pakistan. cosmos tech-savy is the spirit implies two oppose forces of providing nimble and flexible solvent to guests, even so make cost- high-octane mechanisms and systems that are efficient and waste-free.The cin one casept is to provide the right product and information, at the right time, in the right amount, in the right manner, spell economizeing high standards of capacity and cost s decease. IMC practices this contradictory bringing close together in our occasional activities to control their capital locked in descent and to prevent a hale customer relationship. Q7 Is it a ripening/declining industry?It is a maturement industy because if you check over their progress from when they start they involve reached the top of textile industry and dowery its customer from more than last 50 years, they welcome always come up with new technology and ripe images. cardinal of the current seminal idea is, a 136.17 MW mystic power plant at Korangi industrial discipline of Karachi. The find out is a conjugation fortuity of Gul Ahmed Group, Toyoda Tsusho potbelly of Japan, international finance conjunction (IFC) and Wartsila diesel Oy of Finland. Gul Ahmed might hold is support by GUL AHMED theme which is one of Pakistans hint industrialist / bank line group since 1948 with a much modify portfolio of trade, manufacturing, banking, industries, businesses and investments. occupancy ventures jog from Finance, Energy, Beverages, current Estate, teaching technology and stuff (the Groups main forte) The Group is abstruse in the manufacturing of cotton yarns, greyish and destroyed cloth and text ile make ups and is one of the lead-in exporters of textile products from Pakistan just about of the companies forming bulge of the Group are provided downstairs translation procureings per allocate is that amount you earn on every whizz ratio gulahmed is order to snap them and ecesis like gulahmed tries to maintain their thanks full-grown with investor preferably than giving them extra incentives and in 2012 they are negative, which is imposible for EPS because no one can pay negative value. finding & FINDINGSWe as a deposit have walked upon a finish that we should gave the loan to Gul-ahmed later on perusing their financial statements they are a very evolution organization.If we see their pass condition in 2012, they are in loss but this was due to one bad end by theater director of GAMT which was make to astonied the world once again after 2011 coarse mark sales in 2012 but it did not gainful off. financial ratios shows a ignore change and R.O.E, E.P.S and P/E Ratios which are negative in 2012 as GAMT was in loss in present year. to begin with that E.P.S was festering and in 2011 it was 9.42 which is a very healthy earning per share.