PROFITABILITY TRENDS IN A CEMENT ENGINEERING COMPANY

Business Managers and owners of any company generally show interest in financial soundness of the company. Operating efficiency of the company indicates financial soundness. Ability to get good profits for the businessmen or owners indicates operating efficiency. An analysis of profitability trends indicates operating efficiency as well as financial soundness. Profitability Ratios will be useful in analysing Profitability Trends. This Research paper makes an attempt to analyse Profitability Trends in an Indian Engineering Company namely The Ramco Cements Limited. The Ramco Cements Limited is an important company owned by Ramco Group. It is a most popular group in South India as well as in entire India. This company’s important product is Portland cement. In this Paper, Profit Margins including Gross Profit Margin (GPM), Operating Profit Margin (OPM) and Net Profit Margin (NPM) are calculated. Profitability Ratios including Return on Assets (ROA), Return on Capital Employed (ROCE), Return on Share holder’s Equity (ROSE), Cost of Goods Sold Ratio (CGSR), Operating Expenses Ratio (OER), Administrative Expenses Ratio (AER), Selling Expenses Ratio (SER) and Financial Expense Ratio (FER) are also calculated. Formed Hypotheses are tested by using Chi-Square Test.