Comparative Financial Analysis of Construction Companies in India

Abstract

In this study, the comparative financial analysis of construction companies of India is carried out. This analysis is done with the help of various financial ratios. These ratios will help in determining the performance of the companies with respect to the construction industry average of the country. Ratio Analysis presents a failure prediction model for the company based on the previous business data available. It is anticipated that Construction Company will be able to prevent business failures by using the result from the research. The Ratio Analysis on the construction companies of India has been performed, and their performances have been compared based on the standard ratios and Industrial performances over the years. The selection of the companies is based on their total assets, for the firms of ?Construction & Contracting ? Civil? category, which are HNB Engineers Pvt. Ltd., Gondwana Engineers Ltd. and Evergreen India Pvt. Ltd. Company?s performance has been compared on the basis of their financial performance taken from their balance sheets over the last 5 years. Their performances are then analyzed based on the financial ratios considered and thereby interpretations and recommendations are given. For a construction company, the fulfillment of short term obligations, their assets and liabilities lot depends on the availability of funds, which ultimately depends on the work, results and efficiency of the company. It overall showcases the causes of lack in financial performances of the company. Based on the interpretations from the analysis made, recommendations to companies has been given, clearly stating how the company should work on their non-performance in certain areas, which would help them in taking certain measures for their future progress and stability.