(Tiểu luận) comment and analyze financial ratios between cam ranh international airport services joint stock company and fpt digital retail joint stockcompany

HO CHI MINH CTIY OPEN UNIVERSITYSCHOOL OF ADVANCED STUDY

CORPORATE FINANCE STATEMENT

Ho Chi Minh city, 20 November, 2023 th

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NGUYEN NHO NGOC THUY 2154043095 Calculate financial

TABLE OF CONTENTS

Concept: 1

I.Introducing the business 1

1.FPT Digital Retail Joint Stock Company (FRT) 1

2.VICEM Cement Trading Joint Stock Company (TMX) 3

II.Comment and analyze financial ratios between Cam Ranh International Airport Services Joint Stock Company and FPT Digital Retail Joint Stock Too long to read onyour phone? Save

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What is the retail industry?

Retail Industry is also known as retail This is a form of buying products, goods and services from manufacturers, traders or retail companies and then reselling them to final consumers.

The retail industry is also understood as a process of selling products, services, and goods to target customers through different distribution channels Aims to bring profit to sellers.

I.Introducing the business

1 FPT Digital Retail Joint Stock Company (FRT)

FPT Digital Retail Joint Stock Company (referred to as FPT Retail) was established in 2012 in Vietnam, is a member of FPT Group, owns 2 retail chains: FPT Shop and F.Studio By FPT with a total number of 500 stores across 63 provinces and cities (as of April 2018).

FPT Shop retail system is a chain specializing in retailing mobile digital products including mobile phones, tablets, laptops, accessories and technology services Currently, F.Studio by FPT is also making its mark as a leading genuine Apple retailer with full store standards from the highest level.

2 VICEM Cement Trading Joint Stock Company (TMX)

Cement Trading Joint Stock Company operates in the field of commercial business, mainly buying and selling cement provided by cement manufacturing companies within the Vietnam Cement Industry Corporation The main task of the Company is to organize the circulation and consumption of cement in the cities of Hanoi, Thai Nguyen, Vinh Phuc, Phu Tho, Lao Cai, Yen Bai, Ha Giang, Tuyen Quang, Cao Bang,

II.Comment and analyze financial ratios between Cam Ranh International Airport Services Joint Stock Company and FPT Digital Retail Joint StockCompany.

List of financial ratios: Profitability ratios, Liquidity ratios (short-term

solvency), Financial leverage ratios (long-term solvency), Turnover ratios (Asset management), Market value ratios.

LIQUIDITY RATIOS

uom : %

Types of liquidity ratiosFRTTMX

Current ratio = Current assets/ Current liabilities

1.1 Quick ratio = ( Current

assets-3

Inventory)/Current liabilities Cash ratio = Cash/ Current liabilities

FRT: Current ratio is 1.1, which shows that the business can pay off all its short-term debts with 1.1 times its total short-short-term assets This is a fairly low ratio, showing that the ability of the business to pay short-term debts is quite limited.

TMX: Current ratio is 3.19 of short-term assets to pay for 1 VND of short-term debt It can be seen that its ability to pay short-term debts is very good This means that the business has enough current assets to pay off its short-term liabilities immediately, even if all the current liabilities come due at the same time.

TMX has better current ratio than FRT Therefore, TMX has a stable operating cash flow, helping businesses pay short-term debts from cash and cash equivalents.

FRT: quick ratio of 0.33 is considered quite good, showing that the business has the ability to pay its short-term debts, but this ability is still quite low.

TMX: quick ratio is 3.14 A high quick ratio also shows that the business has stable cash flow and can collect short-term receivables quickly.

TMX's quick ratio is much higher than FRT This means that TMX can pay off its short-term debts with more current assets than FRT Therefore, FRT is likely to have difficulty paying its short-term debts.

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FRT: FRT's Cash Ratio is 0.053 which means FRT only has enough cash to pay 5.3% of its short-term debts If this happens regularly, there may be a risk of bankruptcy.

TMX: TMX's cash ratio is 0.72, this is a very high ratio, showing that TMX has the ability to pay all its short-term debts.

FRT's cash ratio is much lower than TMX's cash ratio This shows that FRT's ability to pay short-term debts is very limited, while TMX's ability to pay short-term debts is very good Therefore, FRT needs to take measures to improve its financial situation, such as increasing revenue, reducing costs and improving cash flow.

2 LEVERAGE RATIOS

uom : %

Types of leverage ratiosFRTTMX

Total debt ratio = 81 32

Interest coverage ratio =

Cash coverage ratio = 360

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FRT: the ratio of total debt to total assets of the business will be 81% This means that 1 VND of business assets is financed by 0.81 VND of debt From there, it can be seen that businesses are using more debt to finance their operations.

TMX: The ratio of total debt to total assets of the business will be 32%, which means that 1 dong of business assets is financed by 0.32 dong of debt A low total debt to total assets ratio is a sign that the company also has stable profits and strong finances, allowing the company to borrow less to finance its operations.

FRT's total debt to total asset ratio is much higher than TMX This means that FRT is using more debt to fund its operations than TMX Therefore, FRT needs to closely monitor its total debt to total assets ratio to ensure that this ratio is within a safe level.

FRT: FRT's ICR ratio is 310% , a ratio that is considered very high, meaning the business can use 3.1 times EBITDA to pay for interest expenses FRT can easily meet its interest payment obligations However, investors need to note that a high ICR ratio shows that FRT is using excessive financial leverage, which can lead to risks if business operations encounter difficulties

TMX : TMX's ICR ratio in 2022 has no value

FRT: FRT's CCR ratio is 360%, meaning the business can generate 3.6 times interest expenses from cash flow from its business activities A high CCR ratio shows FRT's well solvency However, investors need to pay attention to other factors such as amount of debt and type of business to make appropriate decisions.

TMX: TMX's CCR ratio in 2022 has no value.

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TURNOVER RATIOS

uom : times or days

Types of turnover ratiosFRTTMX

Inventory turnover =

247.15 Receivables turnover =

FRT: This ratio shows that for every 1 dong of inventory, FRT sells 3.93 dong of revenue FRT's inventory turnover is 3.93, compared to TMX, FRT is lower It can be seen that FRT has a smaller consumer market than TMX FRT has a slower inventory turnover rate.

TMX: This ratio shows that for every 1 dong of inventory, TMX sells 247.15 dong of revenue, showing that revenue is quite high Proves that the business has a strict inventory management policy, leading to the business selling out inventory faster

Comment:

TMX revenue is higher than FRT This shows that TMX is better able to convert inventory into revenue than FRT This is an advantage for TMX, helping the company reduce inventory costs and increase profits.

FRT: receivables turnover ratio is 56.24 times , which means FRT Technical Retail Services Joint Stock Company recovered 56,24 VND of sales revenue from 1 VND of cost of goods sold This ratio is at a high level This means that FRT has a very fast collection rate of receivables

TMX: TMX recovered 41,56 VND of sales revenue from 1 VND of cost of goods sold, which is considered very low compared to other businesses in the same industry, showing that the business has a very slow recovery rate of receivables.

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FRT's high Receivables turnover ratio can be attributed to its flexible sales policy and effective debt collection process That helps businesses collect receivables quickly and minimize bad receivables For TMX, the low RT level may be due to the restrictive sales policy, leading to the business's receivables having long terms, and having many bad receivables.

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FRT: Profit margin ratio is 1,3% This means that for every 100 VND in revenue, FRT businesses only earn 1,3 VND in profit.

TMX: TMX's profit margin is 0,9%, much lower than FRT This shows that TMX has better performance TMX has a lower gross profit margin, leading the company to generate less profit from each unit sold.

In general, TMX enterprises are at a low level compared to FRT This shows that TMX is not able to generate much profit from business activities TMX needs to focus on reducing production operating costs and increasing product/service selling prices.

FRT: FRT business operates in the field of electronic retail, which is an industry with high EBITA profit margins This means that TMA generates more profit from its operations.

TMX: TMX business activities in the cement sector, slow growth rate, high production process costs,

thereby increasing costs and reducing EBITDA The lower the EBITDA, the worse the company's performance This means TMA generates less profit from its business

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FRT's EBITDA is higher than TMX's This means FRT generates more profit from its business, even when depreciating its assets Shows that FRT has better short-term liquidity, faster inventory turnover and good operating efficiency.

FRT: Return on assets ratio is 3,83% This means that for every 100 VND in assets, FRT businesses earn 383 VND in profit, this can show that FRT's profitability is lower than that of companies in the retail industry.

TMX: Return on assets ratio is 4,16% This means that for every 100 VND in assets, TMX enterprise earned 416 VND in profit The high return on total assets shows that TMX uses its assets effectively.

TMX's ROA is higher than that of FRT, which shows that TMX uses its assets effectively, helping to create more profits for the business That is a positive signal for investors, showing that the business has the ability to generate good cash flow and sustainable growth.

FRT: FRT's ROE ratio is 19,4% , meaning the business generates return on its equity In general, FRT's ROE ratio is at a good level and needs to continue to maintain revenue.

TMX: TMX’s ROE ratio is 6,04% , meaning the business generates a 6,04 return on its equity This can show that the ROE ratio has quite low profitability compared to businesses in the same industry.

FRT's ROE is higher than TMX's ROE This is a quite large difference, showing that the two companies have quite different business performance That shows that

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FRT is a company with better business performance than TMX, helping the business generate more profits from equity.

MARKET VALUE RATIOS

uom : million dong or times

Types of market value ratiosFRTTMX

Price-Earnings ratio =

17.86 8.36

FRT: FRT's PER ratio is higher than TMX's PER ratio This means investors are paying more for each dollar of FRT's income A high PER shows that the stock is overvalued Has high growth prospects and clear competitive advantages So investors are satisfied with the low market capitalization rate; The company is predicted to have an average growth rate and will pay high dividends

TMX: While a low PER shows that the stock is undervalued A low PER shows that the stock is undervalued relative to FRT There are low growth prospects and higher risks Low Per may be due to the business earning unusual profits, but these profits will not be sustainable.

FRT and TMX's 2022 PER ratios suggest that FRT is valued higher than TMX Thus, a high ratio brings many benefits to businesses However, this is not always true A high P/E index is sometimes a sign that the business is inefficient, causing low EPS and a high P/E index.

Both businesses have high revenue and operate in the retail sector But if investors prefer low risk, they can consider investing in TMX because TMX has higher current

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ratio and quick ratio, and lower debt compared to assets shows strong healthy financial capacity.

On the contrary, investors who prefer high risk can choose to invest in FRT because high EBITDA shows higher profits from business activities than TMX and the ability to generate higher profits for shareholders but must also Consider some disadvantages such as solvency and poor healthy financial capacity.

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