A COMPARATIVE STUDY ON THE FINANCIAL

PERFORMANCE OF TATA MOTOTRS AND MAHINDRA &

MAHINDRA MOTORS
Submitted to
Utkal University
For partial fulfillment of the requirement for award of the degree of
Master of Commerce (F & C)

SUBMITTED BY

Abhisek kar
M.com (F&C) 3rd Semester

Session: - 2023-25

Auto. Roll No- SACMCO23003

Under the Guidance of

EXTERNAL GUIDE INTERNAL GUIDE

Mr. Kumar Ranjan Pal Lect. Sarmistha Sahoo

Assist. Fund Manager H.O.D & Lect. of M. Com (F & C)

RRL, Bhubaneswar Salipur Autonomous College, Salipur

Salipur, Machuati Road, Balisahi, Odisha 754202

Academic Year 2023-2025

 SALIPUR AUTONOMOUS COLLEGE
(AFFILIATED TO UTKAL UNIVERSITY, ODISHA)

CERTIFICATE

This is to certify that Mr. Abhisek Kar , a bonafied student of M.com(F&C)

has completed the project report entitled “A COMPARATIVE STUDY ON THE

FINANCIAL PERFORMANCE OF TATA MOTOTRS AND MAHINDRA & MAHINDRA

MOTORS” , The project has been submitted as a partial fulfillment of the

requirement for the degree of Master in Commerce(F&C)examination,2024,
To the best of my knowledge, no work with such caption and content
has been submitted to any other university or any institution for the
award of degree

Place:- Lect. Mrs. Sarmistha sahoo

Date:- H.O.D of M. Com(F&C)
Salipur Auto. College, Salipur.
 SALIPUR AUTONOMOUS COLLEGE
(AFFILIATED TO UTKAL UNIVERSITY, ODISHA)

DECLARATION

I do here-by declare that the project with title “A COMPARATIVE STUDY ON

THE FINANCIAL PERFORMANCE OF TATA MOTOTRS AND MAHINDRA &

MAHINDRA MOTORS” submitted to Utkal University in partial, fulfillment of the

requirement for the award of Master in Commerce (F & C) is record of his study

(2023-25) at department of M.Com, Salipur Auto. College, Salipur, Utkal University

under supervision of Lect. Sarmistha Sahoo & that summer has not formed the basis

for award of any degree/diploma/associate ship/fellowship/any other similar tittle.

Place:

Date: (Signature of the Student)

 SALIPUR AUTONOMOUS COLLEGE
(AFFILIATED TO UTKAL UNIVERSITY, ODISHA)

ACKNOWLEDGEMENT
It is with profound gratitude that I express my sincere thanks to Prof. Dr. Sangeeta
Mishra, the principal of Salipur Auto. College, Salipur, Cuttack & all other faculty
members of our college for their constant encouragement during the course of my
study.
I would like to express my gratitude to my external guide Mr. Kumar Ranjan Pal, Asst.
Fund Manager, and Lect. Sarmista Sahoo, Salipur auto. College, Salipur who utilize
their valuable time to guide my
project work in “A COMPARATIVE STUDY ON THE FINANCIAL PERFORMANCE OF
TATA MOTOTRS AND MAHINDRA & MAHINDRA MOTORS”. Their simplicity ,self
affecting humility and genuine affection for student community have been an inspiration

I sincerely express my deep sense of gratitude to my internal guide Sarmistha Sahoo,

Lect. of Department M.com (F & C) for guiding me in completing the project. I am
indebted to all our Friends and Family for their encouragement and support.

Place: Abhisek Kar

Date:
 ABSTRACT

Financial performance is a crucial factor that determines a firm’s profitability, long

term stability, liquidity and is also an importance aspect of financial risk management.
The assessment of financial performance can be achieved by using comparative
balance sheet and profit & loss analysis, ratio analysis, trend analysis etc. Financial
results may be used to assess a company's success.

The main concern of an organization is its profitability and risk. All the financial
decisions that increase the liability will decrease the value of its company on the
contrary the financial decisions that improve the profitability would increase the
company’s value.

Financial Performance research is essential to a company's success. The Financial

Statement Analysis is used to identify patterns and relationships between financial
statement products. The performance, liquidity, and solvency of a business must be
evaluated by both internal management and external consumers (for example,
financial analysts, creditors, and investors) of financial statements.

Using various financial and statistical methods, this study attempted to examine the
financial components of the two Indian-made automobiles (TATA Motors and
MAHINDRA & MAHINDRA Motors). The research is focused mainly on secondary
data from financial reports. This research project presents an analysis on short-term
and long-term solvency of both the automobile companies, followed by an evaluation
of profitability and efficiency of the companies to compare the financial ratios of the
past 3 years of both the companies.
 LIST OF CONTENTS

Chapter Chapter Title Page Number

Number
1 Introduction of the Topic 7
1.1 Rationale of the study 8
1.2 Indian Automobile Industry 9
1.3 Introduction to Tata Motors and 10-12
Mahindra
& Mahindra Motors
1.4 Justification of the Study 13
2 Review of Literature 14
2.1 International Reviews 15-17
2.2 National Reviews 18-20
3 Research Methodology 21
3.1 Objectives of the Study 22
3.2 Research Hypothesis 22
3.3 Scope of the Study 22
3.4 Source of Data 22
3.5 Limitations of the Study 23
4 Data Analysis 24
4.1 Data Representation and 25-49
Interpretation
4.2 Hypothesis Testing 49-50
5 Results & Discussions 51
5.1 Major Findings 52
5.2 Discussions and Suggestions 52
5.3 Conclusion 52
References 53-58
Annexure 59-60
 CHAPTER 1

Introduction of the Topic

1 Rationale of the Study
2 Indian Automobile Industry
3 Introduction to Tata Motors and Mahindra & Mahindra Motors
4 Justification of the Study
 CHAPTER 1

INTRODUCTION OF THE TOPIC

1.1 RATIONALE OF THE STUDY

The cornerstone of a company is finance. It is appropriately referred to as the "science of money."

Finance is crucial for the smooth operation of a company. Every business's policies, activities,
and decisions are governed by finance.

One of the most crucial facets of business is financial management. The strategic planning,
organizing, directing, and controlling of financial undertakings in an organization or institute
is referred to as financial management. Financial output is used by analysts and investors to
compare various companies in the same industry or to compare industries or sectors as a
whole.

A business's risk and profitability are two key components. A company's financial performance is
typically measured by a set of ratios or percentages, however in this study, three ratio
parameters were used to calculate financial performance: solvency ratio, profitability ratio,
and efficiency ratio.

The method of examining and analyzing a company's financial statements (such as the balance
sheet or profit and loss statement) in order to obtain a better understanding of the company's
financial health and to make more informed decisions. Financial statements contain financial
data, however, to be more valuable, this data must be analyzed through financial statement
analysis. Financial analysis is a method of determining the feasibility, stability, and
profitability of a company. The financial statements represent the economic events and
activities that impact a business and that can be converted into accounting figures.

Profit is the engine that propels a company forward. Any firm or business enterprise should be
profitable enough to thrive and prosper in the long run. Profitability implies ability to make
profit from all the commercial operations of an entity, corporation, firm, or an enterprise. It
demonstrates how effectively management can benefit from using all available business
capital.

The automotive industry has a powerful multiplier effect of industrial growth because of its
forward and backward links with many main segments of the economy. Over the course of
the year, the industry has evolved, facing challenges such as transition, consolidation,
restructuring, and adapting to the new environment.
1.2 INTRODUCTION TO THE INDUSTRY

The Indian automotive industry, which includes both automobiles and automotive parts, is
one of the country's most important drivers of economic development. It is a significant driver
of manufacturing GDP, exports, and jobs because it is closely integrated with other industrial
sectors. This industry has expanded due to its conventional strengths in casting, forging, and
precision machining, as well as fabrication (grinding, polishing, welding), cost advantages
(due to the abundance of low-cost skilled labor), and large foreign direct investment (FDI)
inflows.

The automotive industry is made up of a diverse group of companies and organizations that
are involved in the design, production, manufacturing, marketing, and the sale of engine
automobiles. It is one of the world's most profitable sectors. In 2019, India was the 7th largest
commercial vehicle manufacturer and with approximately 3.99 million passenger and
commercial vehicles sold in 2019, India surpassed Germany as the world's fourth largest car
market. By 2021, India is predicted to overtake Japan as the world's third largest auto market.

The two-wheeler segment dominates the industry in terms of volume due to a rising middle
class and young population. Furthermore, the increasing interest of businesses in exploring
rural markets helped the sector to expand. India is a major auto exporter, with good export
growth prospects in the near future. In addition, multiple initiatives by the Indian government
and major vehicle manufacturers are expected to propel India to the forefront of the global
two- wheeler and four-wheeler markets by 2020.

Between financial year 2016 and 2020, domestic automotive production grew at a 2.36
percent compound annual growth rate (CAGR), with 26.36 million vehicles produced in
FY20. Domestic car sales increased at a 1.29 percent compound annual growth rate
(CAGR), with
21.55 million vehicles sold in financial year 2020.

The car industry benefits from a number of factors, including low-cost skilled labor, strong
R&D centers and low-cost steel production. The industry also offers excellent investment
opportunities as well as direct and indirect jobs to professional and unskilled workers. By
2026, the Indian automotive industry (which includes component manufacturing) is estimated
to be worth Rs 16-18 trillion.
1.2 INTRODUCTION TO THE COMPANY

TATA MOTORS

Table 1

TYPE Public

PARENT Tata Group

INDUSTRY Automotive

FOUNDED 1945

FOUNDER J.R.D. Tata

HEADQUARTERS Mumbai, Maharashtra, India

KEY PEOPLE Natarajan Chandrasekaran (chairman)

Guenter Butschek (CEO)

AREA SERVED Worldwide

PRODUCTS Automobiles
Luxury vehicles
Commercial vehicles
Automotive parts
Pickup trucks
SUVs

WEBSITE www.tatamotors.com
Tata Motors Ltd. (formerly known as TELCO, which stands for Tata Engineering and
Locomotive Company) is an Indian multinational automaker headquartered in Mumbai,
Maharashtra, India and a subsidiary of Tata Group. It is the world's 17 th largest automotive
manufacture company, 4th largest truck producer, and 2nd largest bus manufacturer in terms of
volume. It was also ranked 6 th on Fortune India 500 list of top companies in India in 2020.
Passenger cars, trucks, vans, coaches, buses and military vehicles are among its offerings.

Established in 1945 as a locomotive maker, the company produced its first commercial
vehicle in 1954 as part of a joint venture with Daimler-Benz AG that lasted until 1969. With
the introduction of the Tata Sierra in 1991, Tata Motors became the first Indian manufacturer
to demonstrate the capability of producing a successful indigenous vehicle.

Tata Motors, India's largest automotive firm and part of the USD 113 billion Tata Group,
operates in South Korea, Thailand, United Kingdom, Indonesia and South Africa through a
broad global network of 76 subsidiary and associate firms, including Jaguar Land Rover in
the United Kingdom and Tata Daewoo in South Korea.

MAHINDRA & MAHINDRA MOTORS

Table 2

TYPE Public

PARENT Mahindra Group

INDUSTRY Automotive

FOUNDED 2 October 1945, Jassowal, Ludhiana, Punjab, India

FOUNDERS J.C. Mahindra

K.C. Mahindra
M.G. Muhammad

HEADQUARTERS Mumbai, Maharashtra, India

 KEY PEOPLE Anand Mahindra (chairman)
Pawan Kumar Goenka (MD) & (CEO)

AREA SERVED Worldwide

PRODUCTS Automobiles
Commercial vehicles
Motorcycles

WEBSITE www.auto.mahindra.com

Mahindra & Mahindra Ltd. (M&M) is an Indian car manufacturer. It is one of India's largest
automotive producers and also the largest tractor maker in the world. Mahindra & Mahindra
was ranked 17th on Fortune India 500 of top company’s list in India in 2020. Maruti Suzuki
and Tata Motors are two of its biggest rivals in India.

Mahindra & Mahindra was founded in 1945 in Ludhiana as Mahindra & Mohammed by
brothers K.C. Mahindra and J.C. Mahindra and Malik Ghulam Mohammed as a steel trading
firm. Mohammed moved to Pakistan after India gained independence and the formation of
Pakistan. In 1948, Mahindra & Mahindra became the company's new name.

It saw a business chance in venturing into assembling and selling bigger MUVs beginning
with the assembly of military vehicle, commencing in 1947 with Willys Jeep under license in
India. The business began as India's Jeep manufacturers and later expanded to include the
production of light commercial vehicles (LCVs) and agricultural tractors. With its flagship
UV Scorpio, Mahindra & Mahindra has established itself as a major player in the utility
vehicle manufacturing and branding sectors of the Indian automotive industry.
1.4 JUSTIFICATION OF THE TOPIC

This study will help the corporate leaders to steer their company in the right direction by
tracking financial results over several years. Monitoring key parts of the balance sheet and
income statement will help ensure company's financial ability to achieve its operational goals.
Otherwise, a business could run out of cash and default on its debts.

Investors may use ratio analysis to examine a company's financial statements in terms of risk,
solvency, profitability and how well it performs. Ratios are often used by investors to
compare companies within an industry.
 CHAPTER 2

Review of Literature
2.1 International Reviews

2.2 National Reviews

CHAPTER 2

REVIEW OF LITERATURE

2.1 INTERNATIONAL REVIEWS

1. Ika, Siti Rochmah & Abdullah, Norhayati. (2011). A COMPARATIVE STUDY OF

FINANCIAL PERFORMANCE OF ISLAMIC BANKS AND CONVENTIONAL BANKS
IN INDONESIA.
Before and after the enactment of Indonesia's Islamic Banking Act No. 21/2008, the paper
contrasted and analyzed the financial efficiency of Islamic banks against conventional
banking. Financial performance was calculated using a variety of financial ratios that
were divided into profitability, liquidity, risk, solvency, and productivity. Despite the
significant increase in the number of total Islamic banks especially after 2000, the
findings of this study show that there is no significant difference in financial
efficiency between Islamic banks and conventional banks, with the exception of
liquidity ratios as measured by the current ratio.

2. Turetken, Ozgur. (2004). Predicting Financial Performance of Publicly Traded

Turkish Firms: A Comparative Study.
The aim of this research is to use publicly accessible financial data to forecast the
financial results of publicly listed Turkish companies. The prediction accuracy of two
different techniques, multiple discriminant analysis and neural networks, is compared
for this problem. It was also discovered that both methods have better forecasts for
average and poor performers than for top performers, with no statistically significant
variations in prediction accuracy.

3. Yoon, Young-Gyu & Suh, Won-S. (2012). The Financial Performance of Hospitals
Belonging to Multi-hospital System: A Comparative Study. Health Policy and
Management.
The aim of this analysis is to compare and contrast the performance of multi-hospitals and
free-standing hospitals. This study looked at 425 acute-care hospitals in Korea and
found that multi-hospital networks and market conditions, both of which are thought
to be strengths for hospitals, have a negative impact on their financial results.
The
 disparity may be due to higher staffing and operating costs among multi-hospital
systems, implying that they are not more efficient at cost control.

4. Hada, Teodor & Bărbuţă-Mişu, Nicoleta & Căruț, Mihai & Teodora, Avram. (2017).
FINANCIAL PERFORMANCE ANALYSIS TO PUBLIC INSTITUTIONS.
The paper looks at public institutions and their unique characteristics, as well as the
idea of success in general and public institution performance in particular. In addition,
the composition of public institutions' patrimonial outcome accounts is examined, and
the patrimonial result is proposed as a performance measure for public institutions.
Finally, the paper discusses a case study involving financial performance review of a
public institution, City Hall.

5. Hosen, Md Saikat. (2018). Financial Performance Analysis of Pharmaceutical

Industry in Bangladesh.
The thesis examines the success of a pharmaceutical firm in Bangladesh. The primary
goal is to analyse the ratios of four pharmaceutical companies in Bangladesh (Beacon,
ACI, GSKSmithkline, and Square Pharmaceutical Limited). Liquidity ratios, asset
management ratios, profitability ratios, market value ratios, and debt management
ratios are all analysed, and the best performance of the four companies is determined.

6. Zhang, Xiao-Bing & Duc, Tran Phuong, Mutuc, Eugene Burgos & Tsai, Fu-Sheng.
(2021). Intellectual Capital and Financial Performance: Comparison with Financial
and Pharmaceutical Industries in Vietnam. Frontiers in Psychology.
This research explores the effects of intellectual capital on financial performance in
terms of return on assets (ROA) and return on equity (ROE) using Value-Added
Intellectual Capital (VAIC) and its components: human capital efficiency (HCE) and
systemic capital efficiency (SCE) (ROE). Furthermore, this report compares the
effects of financial and pharmaceutical companies.

7. Fardnia, Pedram & Kaspereit, Thomas & Walker, Thomas & Xu, Sizhe. (2020).
Financial performance and safety in the aviation industry. International Journal of
Managerial Finance.
The aim of this study is to see whether financial factors, which are thought to affect an
airline's maintenance, buying, and training policies, are linked to the safety
performance
 of the airline. Methodology used in this report is a series of univariate and multivariate
tests (OLS and Poisson regressions) to see whether an airline's financial well-being,
and also a country's legal and economic climate, have an effect on the airline's
accident rate. Academics and regulators who design, manage, and enforce policies
aimed at improving aviation safety on a national and supranational level should be
interested in the findings of this study.

8. Safitri, Karin & Rabbani, Muhamad & Sudjana, Ateng. (2020). An Analysis of the
Indonesian Insurance Company’s Financial Performance. International Journal of
Scientific and Research Publications (IJSRP).
The data analysis approach used in this study was quantitative methods combined with
a horizontal analysis of PT's financial information. Bhakti Bhayangkara is based on
PSAK No. 28 concerning Loss Insurance Accounting, which includes the Solvency,
Technical Ratio and Profitability Ratio, Liquidity Ratio. According to the findings of
the data review, the company's financial output is in good shape when analyzed across
multiple ratios, but there are some documents that demand attention, such as the need
for appraisal in determining prices, good claims management, and insurance contracts.

9. Muathe, Stephen. (2021). Strategic Intelligence and Financial Performance in the

Commercial Banks in Kenya.
This research sought to determine whether strategic intelligence has any impact on the
overall performance of Commercial banks in Kenya, as well as whether it could be
used to boost the banking sector's performance and support the country's economic
development. The hypothesis was tested with a P-value of 0.5. Between the years
2016 and 2018, information was acquired from the Kenyan Central Bank's annual
records and publications. In addition, the researcher used a simple linear multivariate
analysis to validate the impact of strategic intelligence on saving bank return on
equity.

10. Benlamalih, Amal & Nobanee, Haitham. (2020). Financial Analysis of McDonald’s.
The information was obtained from the company's income statement and balance
sheet, which were available on Yahoo Finance, and a ratio analysis of activity,
liquidity, debt, and profitability was performed as a result. The income statement
results show that the business is profitable, but the balance sheet statistics showed
that the company is experiencing some difficulties.
2.2 NATIONAL REVIEWS

1. Singh, Anju & Solanki, Madhvi (2020) A Comparative Study of Financial

Performance of HDFC Bank and Bank of Baroda. This research studies the
comparison of financial performance of HDFC Bank and Bank of Baroda. The
research span is of seven years i.e., from 2013-14 to 2019-20. According to the
findings of the research, the financial efficiency of a private sector bank (HDFC
Bank) is better than that of a public sector bank (Bank of Baroda). Therefore, it
can be concluded that Bank of Baroda, in comparison to HDFC Bank, needs to
concentrate more on its policies, strengths, and weaknesses.

2. Pal, Dr. Shrabanti. (2012). COMPARATIVE STUDY OF FINANCIAL

PERFORMANCE OF INDIAN STEEL COMPANIES UNDER GLOBALIZATION.
International Journal of Accounting and Financial Management Research (IJAFMR).
The aim of this paper is to study the financial performance of Indian steel
companies and determine whether there is a linear relationship between efficiency,
liquidity, profitability and leverage. According to this report, overall profitability
is influenced by financial measures such as liquidity, profitability, operation, and
financial leverage. As a result, businesses should focus on improving overall
liquidity, solvency, and productivity in order to maximize profitability; otherwise,
the companies' profitability would be impacted in other ways.

3. Paswan, Ranjit. (2016). Financial Performance of FMCG Companies in India: A

Comparative Study. ANVESHAK-International Journal of Management. The
research work looks at the financial results of a few Indian fast-moving consumer
goods (FMCG) firms. ITC and Hindustan Unilever Limited (HUL) have been
chosen as the study's two leading FMCG firms. In terms of liquidity and
profitability, the paper empirically compares the financial results of the two firms.
Various accounting ratios and statistical methods, such as average, standard
deviation, and correlation, were used to achieve the goal.

4. Kumar, Deepak & Gulati, Neelam & Adhana, Deepak. (2020). Financial
Performance Analysis: A Comparative Study of AXIS Bank and ICICI Bank.
The aim of this analysis is to compare Axis Bank's and ICICI Bank's financial results
using Net Profit and various ratios such as return on equity, Total Debt to Owners
Fund ratio, capital adequacy, Total Income to Capital Employed etc. In terms of
net profit, ICICI Bank outperforms Axis Bank, but Axis Bank outperforms ICICI
Bank in terms of return on equity.

5. Bansal, Dr. Rohit. (2015). A comparative study of financial performance analysis

of selected Indian IT companies during 2010-2014. The IUP Journal of
Accounting Research & Audit Practices.
The aim of this research paper is to assess the financial and accounting performance
of leading Indian IT companies. Infosys, Tata Consultancy Services (TCS),
Infosys and Tech Mahindra's financial statements and income statements were
obtained from databases such as Money Control, Yahoo Finance etc. It is
concluded that Infosys is the most sought-after business for investors based on
factors such as return on shareholder's equity, current ratio, debtor turnover ratio,
earnings per share and, most significantly, debt equity ratio.

6. Jayawardhana, Anupa. (2016). Financial Performance Analysis of Adidas AG.

European Journal of Business and Management.
Horizontal analysis, vertical analysis, pattern analysis, and primarily ratio analysis
were used to examine financial results and recommend changes to increase
finance flow, boost dividends, and minimize liabilities. The most recent outcome
is being compared to the company's financial statements over the last five years,
beginning in 2010, to identify trends. The organization should set cost-cutting
objectives, increase employee job performance, and consider outsourcing.

7. N., Ramya. (2020). A STUDY ON FINANCIAL PERFORMANCE ANALYSIS OF

INDIAN OIL CORPORATION LIMITED.
The main goal of this study is to use methods like ratio analysis to assess the firm's
liquidity and profitability status. To determine the company's financial efficiency,
different measures such as current ratio, liquid ratio, absolute liquid ratio, net
profit ratio, gross profit ratio, operating ratio and operating profit ratio have been
used. The results are interpreted in tables for a clearer understanding of the
study. This
 analysis includes explanation, conclusions, and recommendations to help the
business enhance its performance.

8. Gupta, Shweta & Jain, Ms. (2020). A STUDY ON FINANCIAL PERFORMANCE

OF IT SECTOR IN INDIA.
The aim of this study is to examine the financial performance of Indian IT
companies in terms of liquidity, solvency, operation, and profitability. To
comprehend the risk-return trend and assess the sector's upcoming initiatives.
Since the beginning, the sector has outperformed financially, and it has also
managed to maintain average or even above average output in the face of
other economic, political adversities in the nation.

9. Monga, Reema & Aggrawal, Deepti & Singh, Jagvinder. (2021). Application of
AHP in evaluating the financial performance of industries.
This research looks at how the AHP can be used to assess the framework for
evaluating industry financial results in India. Profitability indicators, solvency
indicators, growth and efficiency indicators, and liquidity indicators are the four
metrics presented in this chapter. Certain criteria are graded, along with their sub
criteria, in this application, and the main performance indicator is chosen based on
this.

10. Suzuki, Maruti & Narayanan, Raja & Sharma, Sandhir. (2019). Financial
Performance in Maruti Suzuki. International Journal of Management and
Business. This research will examine the financial performance of the Marathi
Suzuki Group, using financial tools to determine the company's performance.
Based on the specified variables, the study focuses on the general economic
situation of Maruti Suzuki company over a particular timeframe. The study
explores Maruti Suzuki India Limited's financial status as of a five-year
evaluation, as well as the associated Profit and Loss Account.
CHAPTER 3
Research Methodology
3.1 Objectives of the Study

3.2 Research Hypothesis

3.3 Scope of the Study

3.4 Source of Data

3.5 Limitations of the Study

CHAPTER 3

RESEARCH METHODOLOGY

Analytical Analysis is the research approach used in this study. A number of quantitative
elements have been taken to find out the financial performance of both the companies (Tata
Motors and Mahindra & Mahindra Motors). The tools and techniques used in this report are
financial tools i.e., ratio analysis and statistical tools includes mean, standard deviation, co-
efficient of variation.

3.1 OBJECTIVE OF THE STUDY (working capital)

1. To analyze the short-term solvency position of both the companies in the past 3 years.
2. To analyze the long-term solvency position of both the companies in the past 3 years.
3. To analyze the Profitability position of both the companies in the past 3 years.
4. To analyze the efficiency of both the companies in the past 3 years.

3.2 RESEARCH HYPOTHESIS

1. To find out there is not a significant difference in the financial performance of

both the companies.

3.3 SCOPE OF THE STUDY

The purpose of this research is to look at the financial results of two Indian automakers. The
Indian automobile industry is one of the major contributors to GDP growth in the country
(Gross Domestic Product). It has evolved due to a variety of factors, including emerging
technologies, COV-19, and safety regulations. It is also known that the development of
electronic vehicles is opening a way for their production. As a result, it appears that investing
in such businesses is profitable.

3.4 SOURCE OF DATA (financial statement analysis)

Analytical Analysis is the research approach used in this study. This project report represents 3
years data i.e., 2018, 2019, 2020 obtained from the annual report and analysis of other
supported financial statements of the company TATA Motors and Mahindra & Mahindra
Motors.
3.5 LIMITATION OF THE STUDY

There are three significant limitations in this analysis which could be fixed in further studies.
Firstly, the research is based primarily on the company’s annual reports. Secondly, the
secondary information which has been gathered through the company’s yearly report could be
somewhere fabricated. And thirdly this research is confined to three years duration.
CHAPTER 4
Data Analysis
4.1 Data Representation and Interpretation

4.2 Hypothesis Testing

CHAPTER 4

4.1 DATA REPRESENTATION AND ANALYSIS

Statistics is primarily a branch of mathematics that arose from the use of quantitative techniques.
Analysts and investors in finance gather information about firms, markets, expectations, and
volume data. In this study some statistical tools have been used to determine the financial
position of both the companies (i.e., Tata Motors and Mahindra & Mahindra Motors). For this
mean, standard deviation, coefficient of variation, growth and annual growth has been
calculated for each ratio and presented in a tabular form for better understanding of the data.

1. MEAN
The arithmetic mean is calculated by multiplying the sum of a group of numbers by the
number of numbers in the sequence. The mean can be used to evaluate the success of
an investment or business over time, among other things. The sum of all values in a
set of numbers separated by the number of numbers in the collection is the arithmetic
mean.
Mean= x1+x2+…. +xn /n

2. STANDARD DEVIATION

Standard deviation is one of the most widely used tools for assessing the risk of an
investment. The standard deviation is used to calculate market volatility, or the
difference between asset prices and their average price.
As rates fluctuate wildly, the standard deviation is high, indicating that the investment is
risky. Low standard deviation indicates that prices are stable, implying that
investments are low-risk.
Standard deviation= √∑(X-X1) ² / n-1

3. COEFFICIENT OF VARIATION

The coefficient of variation (CV) is a statistical indicator of data point dispersion around
the mean in a data sequence. The coefficient of variance is a useful metric for
measuring the degree of variation between two data sets, even though the means are
significantly different. It describes the ratio of the standard deviation to the mean. The
coefficient of variance is a financial concept that helps investors to assess how much
 uncertainty, or risk, is assumed in relation to the anticipated return on investments.
The higher the risk- return trade-off, the lower the ratio of standard deviation to mean
return.
Coefficient of variation= standard deviation/ mean

To analyze the short-term solvency position

The ease with which cash can be acquired to pay bills and other short-term commitments is
referred to as liquidity. Liquid assets include those that can be traded quickly, such as stocks
and bonds, while cash is by far the most liquid of all.

A liquidity ratio is a form of financial ratio that is used to assess a company's ability to meet
short-term debt obligations. The metric is used to calculate whether a company's existing
assets, or liquid assets, will cover its current liabilities.

1. CURRENT RATIO

The current ratio is a widely used business indicator for evaluating a company's short-
term liquidity in relation to available assets and pending liabilities. To put it another
way, it measures a company's ability to raise enough cash to pay off all of its
obligations as they become due. It's a metric that's used all over the world to assess a
company's overall financial health.

The current ratio is measured using two basic measures found on a company's balance
sheet that it publishes in its quarterly and annual financial results: current assets and
current liabilities. Cash, accounts receivable, inventory, and other current assets that
are scheduled to be liquidated or converted into cash in less than one year are listed as
current assets on a company's balance sheet. Accounts payable, salaries, taxes payable,
 short-term debts, and the present part of long-term debt are all examples of current
liabilities.

The greater the ratio, the more liquid the company. The most common reasonable
current ratio is 2, which is a good financial condition for most businesses.
Low current ratio values (less than 1) mean that a company will have trouble meeting
its current obligations. However, in order to get a better understanding of a company's
liquidity, an analyst should look at its operating cash flow. A high operating cash flow
may also sustain a low current ratio.
If the current ratio is too high (greater than 2), the organization may not be effectively
using its current assets or short-term lending facilities. This may also be a sign of an
issue with working capital management.

Current ratio= Current assets/ Current liabilities

Table 3

YEARS TATA MOTORS MAHINDRA & MAHINDRA

2018 0.95 1.20

2019 0.85 1.18

2020 0.85 1.19

Table 4

TATA MOTORS MAHINDRA &

MAHINDRA

MEAN 0.88 1.19

STANDARD DEVIATION 0.05 0.01
COEFFICIENT OF
VARIATION (%) 6.53 0.84

GROWTH -10.52 -0.83

ANNUAL GROWTH -3.50 -0.27

2. QUICK RATIO

The quick ratio is a measure of a company's ability to fulfil short-term obligations

with its most liquid assets and is an indication of a company's short-term liquidity
status. It's also known as the acid test ratio because it shows a company's ability to pay
down current liabilities rapidly using near-cash assets (assets that can be converted
quickly to cash).

A good liquidity ratio is regarded as an indication of an organization's competence, as

it ensures healthy business performance and, as a result, can contribute to long-term
growth. Lenders, vendors, and investors use the quick ratio to see if a business has
enough liquid assets to cover its short-term obligations.

The ideal quick ratio is 1:1, which means that the firm has enough assets in its hands
that can be liquidated immediately to pay off current liabilities.
If the quick ratio is less than one, the firm will not be able to pay off any of its
existing liabilities in the short term. If the ratio is greater than one, the company holds
enough liquid assets to pay off its current liabilities right away.

Quick Ratio= Liquid assets/ Quick liabilities

 QR= Cash and cash equivalents + marketable securities + accounts receivable/
Current liabilities

QR= Current assts – inventory – prepaid expenses/ Current liabilities

Table 5
YEARS TATA MOTORS MAHINDRA & MAHINDRA

2018 0.66 1.01

2019 0.58 0.97

2020 0.58 0.98

Table 6

TATA MOTORS MAHINDRA &

MAHINDRA

MEAN 0.60 0.98

STANDARD DEVIATION 0.04 0.02

COEFFICIENT OF
VARIATION (%) 7.61 2.10

GROWTH -12.12 -2.97

ANNUAL GROWTH -4.04 -0.99

Graph 1

LIQUIDITY RATIOS
1.4

1.19
1.2

0.98
1
0.88

0.8

0.6
0.6

0.4

0.2

0
TATA Motors M&M Motors

current ratio quick ratio

Current Ratio: M&M's operating cycle performance, or its ability to convert

output into cash, is higher than Tata Motors. Tata Motors could face cash flow
problems if its receivables aren't paid on time, or if its inventory turnover is too
high.
Quick Ratio: M&M's capacity to meet short-term liabilities with short-term
assets is greater than Tata Motors.

To analyze the long-term solvency position

A leverage ratio is one of many performance parameters that examines how much capital
comes from debt (loans) and evaluates a company's ability to fulfil its financial obligations.
The leverage ratio category is essential because businesses use a combination of equity and
debt to fund their operations, and understanding how much debt a company has will help
decide if it will be able to pay off its debts when they are due.
 1. DEBT TO EQUITY RATIO

Divide a company's total liabilities by its shareholder equity to get the debt-to-equity
(D/E) ratio. The balance sheet of a company's financial statements contains these
figures. The ratio is used to determine the financial leverage of a business. In
corporate finance, the D/E ratio is a crucial measure. It's an indicator of how much a
corporation relies on debt to finance its activities rather than wholly-owned funds. In
the event of a market downturn, it represents the willingness of shareholder equity to
pay all outstanding debts.
The debt-to-equity ratio should be between 1 and 1.5. A high debt-to-equity ratio
suggests that a corporation is dependent on debt to fund its expansion. Companies that
spend a lot of money in their properties and activities have a higher debt to equity
ratio. If the debt-to-equity ratio is low, it usually means the company hasn't used debt
to fund operations.
If a company's debt interest rates are higher than its return on investment, it has a
negative debt to equity ratio. A business with a negative net worth will also have a
negative debt to equity ratio.
Debt to Equity Ratio = Total Debt / Shareholders’ Equity

Table 7

MAHINDRA &
YEARS TATA MOTORS
MAHINDRA

2018 0.82 1.23

2019 1.51 1.35

2020 1.58 1.56

Table 8

TATA MOTORS MAHINDRA &

MAHINDRA

MEAN 1.30 1.38

STANDARD DEVIATION 0.42 0.16

COEFFICIENT OF
VARIATION (%) 32.22 12.10

GROWTH 92.68 26.82

ANNUAL GROWTH 30.89 8.94

2. INTEREST COVERAGE RATIO

The interest coverage ratio is a metric that assesses a company's ability to manage its
debt. It's one of the debt ratios that can be used to assess a business's financial health.
Market analysts and investors value a high interest coverage ratio because a business
cannot prosper and may not even be able to survive unless it can pay the interest on its
current obligations to creditors.

If a company's interest coverage ratio is poor, it's more likely that it won't be able to
pay its debt, placing the company at risk of bankruptcy. To put it another way, a low-
interest coverage ratio implies that there is a small amount of profit sufficient to fund
the debt's interest cost.
 A high ratio means that there are sufficient earnings to repay the debt, but it may also
suggest that the company is misusing the debt. For example, if a company does not
borrow enough, it will not be able to invest in new products and innovations to remain
competitive in the long run.

Interest coverage ratio= earnings before interest, taxes, depreciation and

amortization/ interest expenses
Table 9

YEARS TATA MOTORS MAHINDRA &

MAHINDRA

2018 2.96 2.65

2019 0.70 2.45

2020 -0.06 1.43

Table 10

TATA MOTORS MAHINDRA &

MAHINDRA

MEAN 1.2 2.17

STANDARD DEVIATION 1.57 0.65

COEFFICIENT OF
VARIATION (%) 130.90 30.06
GROWTH -102.02 -46.03

ANNUAL GROWTH -34 -15.34

Graph 2

LEVERAGE RATIOS
2.5

2.17

1.5 1.38
1.3
1.2

0.5

0
TATA Motors M&M Motors

debt to equity interest coverage

Debt to equity Ratio: Tata Motors' high debt/equity ratio compared to M & M
indicates that the company has been aggressive in using debt to fund its
expansion. Because of the extra interest cost, this could result in unstable
earnings.

Interest coverage Ratio: Tata Motors' ability to cover interest costs could be
a concern. When the interest coverage ratio is one, Tata Motors will only pay
the interest and not the principle to the lender. M&M, on the contrary,
indicated that the company could comfortably cover interest costs.
To analyze the Profitability position

Analysts and investors use profitability ratios to calculate and analyze a company's ability to
produce revenue in relation to sales, balance sheet assets, operational costs, and shareholders'
equity for a given time period. They demonstrate how effectively a corporation uses its assets
to generate gain and value for its shareholders.

Most businesses strive for a higher ratio or valuation because it indicates that the company is
doing well in terms of sales, earnings, and cash flow. When analyzing the averages, they are
most useful when compared to similar companies or previous years.

1. MARGIN RATIO

At different levels of calculation, margin ratios reflect a company's ability to turn

revenue into profits. Gross profit margin, operating cost ratio, net profit margin, cash
flow margin, operating profit margin, EBITDA, EBITDAR are all examples of profit
margins.

2. GROSS PROFIT MARGIN

Gross profit margin is calculated by dividing gross profit by sales revenue. This
illustrates how much money a company makes after deducting the costs of producing
its products and services. A high gross profit margin ratio indicates that core activities
are more efficient, allowing the company to pay operating expenses, fixed costs,
dividends, and depreciation while still generating net earnings. A low profit margin
implies a high cost of products sold, which can be caused by poor buying practices,
low selling costs, low profits, strong market competition, or ineffective sales
promotion policies.

Gross profit margin = gross profit/ total revenue

Table 11
 YEARS TATA MOTORS MAHINDRA & MAHINDRA

2018 12.02 15.04

2019 9.15 15.55

2020 8.02 14.31

Table 12

MAHINDRA &
TATA MOTORS
MAHINDRA

MEAN 9.73 14.96

STANDARD DEVIATION 2.06 0.62

COEFFICIENT OF
VARIATION (%) 21.19 4.16

GROWTH -33.27 -4.85

ANNUAL GROWTH -11.09 -1.61

3. OPERATING PROFIT MARGIN

Operating Profit Margin measures earnings as a percentage of revenue before

deducting interest and income taxes. Companies with high operating profit margins
are better able to fund fixed costs and interest on obligations, have a better chance of
surviving an economic downturn, and can deliver lower rates
 than their rivals with lower profit margins. Since good management can greatly boost
a company's financial performance by managing its operating costs, the operating
profit margin is often used to measure the strength of its management.
Operating profit margin = Operating income/ Total revenue

Table 13
YEARS TATA MOTORS MAHINDRA & MAHINDRA

2018 4.70 11.48

2019 1.33 11.74

2020 -0.17 9.08

Table 14

TATA MOTORS MAHINDRA &

MAHINDRA

MEAN 1.95 10.76

STANDARD DEVIATION 2.49 1.46

COEFFICIENT OF
VARIATION (%) 127.68 13.62

GROWTH -96.38 -20.90

ANNUAL GROWTH -32.12 -6.96

 4. NET PROFIT MARGIN

The ratio of after-tax gains to net revenue is known as the net profit percentage. It
shows how much profit is left after all manufacturing, administration, and finance
costs have been deducted from sales and income taxes have been taken into account.
As a result, it's one of the best indicators of a company's overall success, particularly
when combined with a look at how well it manages its working capital. It's also used
to contrast a company's output to those of its rivals.
Net Profit margin = Net Profit ⁄ Total revenue x 100

Table 15
YEARS TATA MOTORS MAHINDRA & MAHINDRA

2018 2.31 7.43

2019 -9.58 4.44

2020 -4.20 -1.43

Table 16

TATA MOTORS MAHINDRA &

MAHINDRA

MEAN -3.82 3.48

STANDARD DEVIATION 5.95 4.50

COEFFICIENT OF
VARIATION (%) -155.72 129.52
GROWTH -281.81 -119.24

ANNUAL GROWTH -93.93 -39.74

Graph 3

PROFITABILITY RATIOS
( MARGIN RATIOS)
20

14.96
15

10.76
10 9.73

3.48
1.95
0
TATA Motors M&M Motors

-5 -3.82

GROSS PROFIT OPERATING PROFIT NET PROFIT

Gross Profit Margin/ Net Profit Margin: With a poor gross margin and a low
net profit margin, Tata Motors would have been unable to cover its operating
and other expenses, let alone invest for the future. M&M motors, on the other
hand, had a decent gross profit margin and a low net profit, despite being better
than Tata Motors, which has a negative net profit margin.
 Operating Profit Margin: A higher operating margin means that the company is
making enough profits from operations to cover all of the expenses associated
with running that business. A healthy operating margin is one that is greater
than 15% therefore M&M motors is in good position than Tata Motors.

5. RETURN RATIO

The capacity of a business to produce returns for its shareholders is expressed by

return ratios. Return on assets, return on debt, return on equity, return on income, cash
return on assets, return on retained earnings, risk-adjusted return, return on capital
employed, return on invested capital are all examples of financial returns.

6. RETURN OF ASSETS

The return on assets (ROA) is a profitability ratio that shows how much profit a
business can make from its resources. Return on assets, in other words, tests how
effective a company's management is at producing profits from its economic capital or
assets on its balance sheet. The higher the amount return of assets, the better a
company's management is at handling its balance sheet to produce income.

ROA = Net Income / Total Assets

Table 17
YEARS TATA MOTORS MAHINDRA & MAHINDRA

2018 2.71% 5.47%

2019 -9.38% 3.25%

2020 -3.74% 0.07%

 Table 18

TATA MOTORS MAHINDRA &

MAHINDRA

MEAN -3.47 2.93

STANDARD DEVIATION 0.06 0.02

COEFFICIENT OF
VARIATION (%) -174.33 92.63

GROWTH -238 -98.72

ANNUAL GROWTH -79.33 -32.90

7. RETURN ON INVESTED CAPITAL

The return on invested capital (ROIC) is a metric that calculates an efficiency of a
company in allocating its capital to productive investments. The return on invested
capital (ROIC) ratio shows how efficiently a business uses its capital to produce
income. The return on invested capital ratio can be used to assess a company's
progress. Any company that generates excess returns on acquisitions that exceed the
cost of raising capital is a value creator and, as a result, typically trades at a premium.
ROIC = NOPAT/Invested Capital

Table 19
YEARS TATA MOTORS MAHINDRA & MAHINDRA

2018 7.36% 12.01%

2019 2.49% 11.75%

2020 -0.25% 7.65%

 Table 20

TATA MOTORS MAHINDRA &

MAHINDRA

MEAN 3.20 10.47

STANDARD DEVIATION 0.03 0.02

COEFFICIENT OF
VARIATION (%) 120.44 23.35

GROWTH -103.39 -36.30

ANNUAL GROWTH -34.46 -12.10

RETURN ON EQUITY

The percentage of net profits relative to stockholders' equity, or the rate of return on the capital that
equity investors have put into the company, is known as return on equity (ROE). Stock analysts and
investors pay close attention to the return on equity (ROE) ratio. A high ROE ratio is commonly
listed as a justification to buy a company's stock. Companies with a high return on equity are more
likely to be able to generate cash internally, reducing their reliance on debt funding.
ROE = Net Income / Shareholders’ Equity

Table 21
YEARS TATA MOTORS MAHINDRA & MAHINDRA

2018 9.41% 20.42%

2019 -47.90% 13.29%

2020 -19.13% 0.31%

Table 22

TATA MOTORS MAHINDRA &

MAHINDRA

MEAN -19.21 11.34

STANDARD DEVIATION 0.28 0.10

COEFFICIENT OF
VARIATION (%) -149.19 89.91

GROWTH -303.29 -98.48

ANNUAL GROWTH -101.09 -32.82

Graph 4
 PROFITABILITY RATIOS
(RETURN RATIOS)
15

10 11.34
10.47

3.2 2.93
0
-3.47 TATA Motors M&M Motors

-5

-10

-15

-19.21
-20

-25

return on assets return on invested capital return on equity

Return on Assets: In comparison to Tata Motors, which had a negative ROA, M&M's average
ROA indicates that earnings were produced from invested capital (assets). M & M's assets are
made up of both debt and equity. Both of these funding options are used to finance the
company's activities. M&M was turning the money it had to in a better way, as shown by the
Better ROA figure. The Better ROA figure indicates to investors that M&M was essentially
turning the capital it had to spend into net profits. However, the lower the ROA level, the
worse it is for Tata Motors, since the company is earning less money on more investment.

Return on Invested Capital: It indicates how much profit is produced by each rupee of
employed capital. M&M, a higher ratio is more desirable since it ensures that each rupee of
capital employed generates more rupees of benefit. Investors in M&M are looking at the ratio
to see how effectively the company uses its resources and its long-term funding plans. The
returns on the assets
should always be higher than the rate at which they borrow to finance them. M&M's Return
on Invested Capital, which is a long-term profitability ratio, is higher than Tata Motors'
because it demonstrates that M&M assets performed better when long-term funding was
taken into account.

Return on Equity: This ratio compares a company's net profits to its average shareholders'
equity to determine how profitable it is. The return on equity (ROE) ratio calculates how
much the company's shareholders profited from their investment. In the case of M&M, the
higher the ratio percentage, the more effective the management is in using its equity base and
the greater the return to investors is. Tata motors shows a negative return on equity which
indicates that the company has lost money. If we see a large magnitude of value, it's possible
that the company has been losing money for a long time, as equity capital declines with each
loss.

To analyze the efficiency of the companies

An efficiency ratio assesses a company's ability to produce revenue from its properties. An
efficiency ratio, for example, can consider a variety of factors, such as the time it takes to
receive cash from consumers or the time it takes to turn inventory to cash. These ratios can be
compared to those of rivals in the same sector to classify companies that are better run than
the rest. Sales to inventory, accounts payable to sales, sales to net working capital, fixed asset
turnover stock turnover ratio are some of the most commonly used efficiency ratios.

1. ASSET TURNOVER RATIO

The asset turnover ratio compares the value of a company's assets to the value of its sales or
profits. It is a metric that measures how effectively a business uses its assets to produce
revenue. A company's ability to generate revenue from its assets is measured by its asset
turnover ratio. The higher the asset turnover ratio, the more effective it is. A low asset
turnover ratio, on the other hand, means that a business is not effectively using its assets to
produce revenue.
Asset turnover ratio = net sales / average total sales
 Table 23

YEARS TATA MOTORS MAHINDRA & MAHINDRA

2018 88.91 67.11

2019 98.28 64.09

2020 81.04 56.99

Table 24

TATA MOTORS MAHINDRA &

MAHINDRA

MEAN 89.41 62.73

STANDARD DEVIATION 8.63 5.19

COEFFICIENT OF
VARIATION (%) 0.09 0.08

GROWTH -8.85 -15.07

ANNUAL GROWTH -2.95 -5.02

2. INVENTORY TURNOVER RATIO

Inventory turnover is a financial ratio that indicates how many times a company's
inventory has been sold and replaced in a given timeframe. The days it takes to sell the
inventory on hand can then be calculated by multiplying the number of days in the
timeframe by the inventory turnover formula.
The higher the inventory turnover, the better, since it indicates that a company sells items
quickly and that there is enough demand for its products. Low inventory turnover is a sign
 of slow sales and weakening demand for a company's goods.
Inventory turnover is a metric that analysts use to assess how quickly a business sells
inventory to market averages. Low turnover indicates slow sales and possibly
surplus inventory (also known as overstocking). It may be the result of insufficient
promotion or a problem with the products being offered for sale.

Inventory Turnover Ratio = Cost of Goods Sold/ Average Inventory

Table 25

YEARS TATA MOTORS MAHINDRA & MAHINDRA

2018 6.99 9.86

2019 7.74 8.58

2020 6.97 8.57

Table 26

TATA MOTORS MAHINDRA &

MAHINDRA
MEAN 7.23 9.00

STANDARD DEVIATION 0.43 0.74

COEFFICIENT OF
VARIATION (%) 0.06 0.08

GROWTH -0.28 -13.08

ANNUAL GROWTH -0.09 -4.36

Graph 5

EFFICIENCY RATIOS
100
89.41
90

80

70
62.73
60

50

40

30

20

10 7.23 9

0
TATA Motors M&M Motors

asset turnover inventory turnover

Asset Turnover: Since Tata Motors had a higher turnover ratio, it was able to generate more
revenue with less assets, indicating that the business was doingwell. However, M&M's
lower turnover ratio indicates that the company is not making the best use of its assets.

Inventory Turnover Ratio: Since goods deteriorate due to weak sales, Tata Motors' low
turnover was a bad sign. As a result, surplus inventory remained in a warehouse. The high
M&Ms ratio indicated good sales.
5 HYPOTHESIS TESTING

The Hypothesis states that there is no significant difference in the financial performance
of Tata Motors and Mahindra & Mahindra Motors.
We used a t-test on Excel to verify the above hypothesis, and the results are shown below.

Table 27

t-Test: Two-sample assuming unequal Variable 1 Variable 2

variance Tata Motors Mahindra & Mahindra
Mean 7.416666667 10.94916667
Variance 717.7249879 289.5384265
Observations 12 12
Hypothesized Mean Difference 0
df 19
t Stat -0.385568249
P(T<=t) one-tail 0.352049676
t Critical one-tail 1.729132812
P(T<=t) two-tail 0.704099352
t Critical two-tail 2.093024054
 At 5% significance level
The computed t value from the above table is -0.3855 and 0.7040 is the p value. We can
deduce from these two parameters that the result is not significant at p<0.05.

The null hypothesis H0, in other words, is accepted. As a result, we can infer that there is no
significant difference in the financial output of Tata Motors and Mahindra & Mahindra
Motors.
CHAPTER 5
RESULTS AND

DISCUSSIONS
5.1 Major Findings

5.2 Conclusion
CHAPTER 5

RESULTS AND DISCUSSION

a. MAJOR FINDINGS
For the time span under study, there is no significant difference in the
financial results of Tata Motors and Mahindra & Mahindra Motors as the p
value is 0.7040 which is higher than the significance level 5%.

b. DISCUSSIONS AND SUGGESTIONS

At this time of lower valuations in Tata Motors, an investor can build up a
position in the company.
Mahindra & Mahindra has consistently outperformed its peers, albeit at a
slower rate of growth.

c. CONCLUSION
Based on a comparative study of the financial results of tata motors and
Mahindra & Mahindra motors, it can be inferred that M&M motors
liquidity position was high while Tata motors was weak, indicating the
companies' ability to meet short-term obligations on time. Tata motors
long-term solvency is lower, indicating that the company relied more on
external funds for long-term borrowings, resulting in a lower level of
security for creditors. The Profitability ratios of Mahindra & Mahindra
Motors are higher than those of Tata Motors. Mahindra & Mahindra
Motors made a significant profit, which is beneficial for the company.
After considering all of the factors related to this data analysis, it has led to
the big conclusion that Tata Motors output is satisfactory, but Mahindra &
Mahindra Motors maintains a strong market place. As a result,
stockholders will take risks with their investments. They will receive a
healthy return, and their investments will be safe and stable.
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 ANNEXURE
TATA MOTORS
BALANCE SHEET (CONSOLIDATED)

Equities & Liabilities Mar 2020 Mar 2019 Mar 2018

Share Capital 719 679 679

Reserves & Surplus 61,491 59,500 94,748

Current Liabilities 140,454 145,457 143,219

Other Liabilities 119,456 101,557 92,703

Total Liabilities 322,121 307,194 331,350

Assets

Fixed Assets 161,952 142,370 161,330

Current Assets 119,587 123,431 135,972

Other Assets 40,581 41,392 34,046

Total Assets 322,121 307,194 331,350

Other Info

Contingent Liabilities 15,590 17,148 15,431

 MAHINDRA & MAHINDRA MOTORS
BALANCE SHEET (CONSOLIDATED)

Equities & Liabilities Mar 2020 Mar 2019 Mar 2018

Share Capital 554 543 543

Reserves & Surplus 39,415 39,439 36,232

Current Liabilities 54,009 58,743 49,149

Other Liabilities 73,027 64,664 51,286

Total Liabilities 167,006 163,391 137,210

Assets

Fixed Assets 35,033 31,668 28,291

Current Assets 64,045 69,406 59,076

Other Assets 67,927 62,316 49,843

Total Assets 167,006 163,391 137,210

Other Info

Contingent Liabilities 8,64 9,42 7,28

8 6 4

59