A STUDY ON RATIO ANALYSIS OF PAPER
ABSTARCT :
The paper industry plays a vital role in the economic development of many countries, providing essential raw materials for various sectors including publishing, packaging, and hygiene products. Over the years, the demand for paper has steadily increased due to population growth, urbanization, and rising literacy rates. However, the paper industry faces intense competition, fluctuating raw material costs, environmental regulations, and changing consumer preferences, which significantly affect the financial performance of paper manufacturing companies. Understanding the financial health of these companies is crucial for stakeholders such as investors, creditors, management, and policymakers to make informed decisions.
Ratio analysis is a widely used tool for evaluating the financial performance of a company. It involves the calculation and interpretation of various financial ratios derived from the company’s financial statements, such as the balance sheet and income statement. These ratios help in assessing profitability, liquidity, solvency, operational efficiency, and market valuation. Through ratio analysis, stakeholders can identify the strengths and weaknesses of a company, compare its performance with industry standards, and evaluate trends over time. In the context of the paper industry, ratio analysis provides critical insights into how companies manage their resources, control costs, and generate returns.
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