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    Presented by: Sohail Hamayon Khan

    1PRESENTED TO: MR. NOMAN SHAFI

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    Out line of the presentationy Brief introduction of the company

    y Findings of my Financial Analysis in comparison to other

    companies in our group table showing the result of your ratios

    y Main factors of your report given to the potential investor

    y business analysis

    y

    My recommendations in relation to my findings of thefinancial and business analysis

    y Assumptions for Sales forecast and adjustment your AFN

    PRESENTED TO: MR. NOMAN SHAFI 2

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    PRESENTED TO: MR. NOMAN SHAFI 3

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    Brief introduction of the companyy It is sister concern of Quetta group

    Textile

    Live stock Confectionary

    leather

    y Formed in 1970

    y

    Manufacturers of organic and sustainable textileproducts, including cu certified organic cotton, lyocell,bamboo fiber and other specialized yarns

    PRESENTED TO: MR. NOMAN SHAFI 4

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    Brief introduction of the companyy Activities

    Spinning Waving

    y Exports to Europe USA Far East

    y DIRECTORS Mr. Khalid Iqbal (Chief

    Executive) Mr. Tariq Iqbal

    Mr. Daanish Javed Mr. Asim Khalid Mr. Omer Khalid Mrs. Najma Javed Mrs. Tabbasum Tariq

    y AUDITORS

    Mushtaq and Company CharteredAccountants 407 / 4th Floor,Commerce Centre Hasrat

    Mohani Road, Karachiy REGISTERED OFFICE

    Nadir House (Ground Floor)

    I. I. Chundrigar Road

    Karachi

    y

    MILLS P/3, S.I.T.E., Kotri

    B/4, S.I.T.E Kotri

    47.5 K.M. Lahore Multan Road,Bhai Pheru

    PRESENTED TO: MR. NOMAN SHAFI 5

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    Brief introduction of the companyy Vision statement

    become a market leader by producing high quality products with latesttechnologies

    integrate its supply chain and diversify its customer portfolio strives toexplore new markets worldwide

    to be fittest in a changing market

    y Mission secure & rewarding investment for its shareholders & investors

    reliable source of high quality yarns & fabrics at affordable prices to itscustomers

    secure place of work to its employees & an ethical partner to its businessassociates

    PRESENTED TO: MR. NOMAN SHAFI 6

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    PRESENTED TO: MR. NOMAN SHAFI 7

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    Findings of my Financial Analysisy Vertical analysis

    Current assets

    Noncurrent AssetsNoncurrent Liabilities

    Current Liabilities

    Share holder Equity

    Gross profitEBIT

    EBT

    PRESENTED TO: MR. NOMAN SHAFI 8

    39.56538 39.31994 43.32105 43.28283 41.75265

    60.43462 60.68006 56.67895 56.71717 58.24735

    40.63269 47.3723 42.46319 36.20848 25.13818

    46.72785 39.68537 47.49727 49.47235 47.82537

    12.63251 12.94234 10.03954 14.31917 27.03645

    8.6792127 10.1859 10.29342 14.21428 18.29816

    8.4143953 10.03831 9.39157 12.90816 14.33345

    2.0008343 2.937917 0.806982 1.37442 4.023859

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    Findings of my Financial Analysisy Horizontal analysisTotal Assets

    Current assetsNoncurrent Assets

    Noncurrent Liabilities

    Current Liabilities

    Share holder Equity

    Gross profit

    EBIT

    EBT

    PRESENTED TO: MR. NOMAN SHAFI 9

    100 109.3334 145.1012 172.116 164.3147

    100 108.6552 158.8746 188.2875 173.3984

    100 109.7775 136.084 161.5288 158.3678

    100 92.85549 147.4904 182.225 168.1741

    100 127.4682 151.638 153.3755 101.6564

    100 127.4682 151.638 153.3755 101.6564

    100 126.367 149.9602 258.4669 431.3048

    100 128.4554 141.1275 242.1039 348.4859

    100 158.1041 50.99753 108.4098 411.4233

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    Findings of my Financial Analysis

    PRESENTED TO: MR. NOMAN SHAFI 10

    Current Ratio

    Quick Ratio

    Cash Ratio

    Net Working Capital

    0.89949966

    0.22051642

    0.01981693

    -279077558

    LiquidityAnalysis

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    Findings of my Financial Analysis

    PRESENTED TO: MR. NOMAN SHAFI 11

    Profitability Analysis

    Gross profit margin

    profit margin Analysis

    Return On Assets

    Return on equity

    Return on Capital Employed

    0.12334195

    0.01295443

    0.01238042

    0.07300073

    0.01038743

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    Findings of my Financial Analysis

    PRESENTED TO: MR. NOMAN SHAFI 12

    Leverage Analysis

    debt ratio

    Debt-Equity ratio

    Capitalization ratio

    Interest Coverage Ratio

    Cash flow to Debt Ratio

    0.84604607

    6. 70 688

    0. 88 689

    - . 6 84 7

    -0.0003 3

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    Findings of my Financial Analysis

    PRESENTED TO: MR. NOMAN SHAFI 13

    Operating performance Analysis

    Account receivable turnoverAverage collection Period(ACP)

    inventory Turnover

    Average Age of Inventory(AAI)

    Operating Cycle

    Fixed asset turnover

    Total Asset turnover

    7.14826026

    53.6646958

    3.33250274

    112.10793

    165.772626

    1.59668759

    0.88437999

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    Findings of my Financial Analysis

    PRESENTED TO: MR. NOMAN SHAFI 14

    Market value/ cash flow investmentEarnings per share

    Price/ earnings ratio

    Book value per share

    Dividend Yield

    operating cash flow to sales

    ratio

    cash flow coverage ratio

    Dividend Payout

    18.0510074

    2.79191201

    269.678071

    0.02187818

    -0.008969

    0.00363995

    1276.73875

    0.06180392

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    Findings of my Financial Analysis

    PRESENTED TO: MR. NOMAN SHAFI 15

    Liquidity Measurement Ratio

    Current Ratio

    Quick Ratio

    Cash Ratio

    Net Working CapitalProfitability Indicator Ratio

    Gross profit margin

    profit margin Analysis

    Return n Assets

    Return on equity

    Return on Capital EmployedDebt Ratio/ Leverage

    debt ratio

    ebt-Equity ratio

    Capitalization ratio

    Interest Coverage Ratio

    Cash flow to ebt Ratio

    Industrial Average Analysis

    0.940459522 it is similar to industrial average no change

    0.366116029 need ti increase the quick Assets

    0.029924063 increased cash balance needed

    -45710693.49Quetta textile has better Net working capital thenMarket

    0.141625572 similar to industry

    0.010873155 similar to industry

    0.011295204 similar to industry

    0.041709908 Better then industry

    0.008662444 Better then industry

    0.734205468 bit high in debt financing should increase equity finance

    3.370285139 too high

    0.407138751 similar to industry

    -1.179188811 similar to industry

    0.018685035 too low

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    Findings of my Financial Analysis

    PRESENTED TO: MR. NOMAN SHAFI 16

    Activity/Operating Performance Ratios

    Account reciveable turnover

    Average collection Period(ACP)

    inventory Turnover

    Average Age of Inventory(AAI)

    Operating Cycle

    Fixed asset turnover

    Total Asset turnover

    Market Value/Cash flow indicator

    Earning per share

    Price/ earning ratioBook value per share

    Devidend Yeild

    operating cashflow to sales ratio

    cashflow coverage ratio

    Dividend Payout

    5.225457373 better then industry

    78.093329 more the

    3.637461536 similar to industry

    104.0077932 beter then industry182.1011223 better then industry

    1.986064603 better then industry

    0.898806958 similar to industry

    4.49135898 better than industry

    -85104.62793 better than industry60.41316597 better than industry

    0.004512366 better than industry

    0.014820081 better than industry

    0.038512069 better than industry

    6077.657759 better than industry

    0.073087065 better than industry

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    PRESENTED TO: MR. NOMAN SHAFI 17

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    Criteria for investors decision making

    PRESENTED TO: MR. NOMAN SHAFI 18

    Criteria Quantitativeanalysis %age

    Qualitativeanalysis %age

    Decision

    makingweightage

    Pakistani

    economyanalysis

    70 30 0.2

    Textile industry

    analysis

    70 30 0.3

    Firms financial

    performanceanalysis

    60 40 0.5

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    Criteria for investors decision makingy Pakistani economy analysisy Quantitative Measures

    Exports = 20

    Pakistan share of textile in the world = 30

    Stock market situation in Pakistan = 20

    y Qualitative Measures

    Social condition in Pakistan = 5

    Political Stability = 15

    War on terror effect = 10

    y Textile Industry

    y Quantitative Measures

    Textile share in total exports = 25

    Textile industry growth in Pakistan = 25

    Textile industry in Large scale

    Manufacturing(LSM) =10

    Cost competence of Pakistan textile = 10

    y Qualitative Measures

    Growth perspective of textile industry =10

    Threat of substitutes =10

    Threat of competition from the foreignindustries =10

    y Firms financial performanceanalysisy Quantitative Measures

    Vertical analysis =5

    Horizontal analysis =5

    Ratio analysis of individualfirm =15

    Ratio analysis with the industryaverage =20

    Future forecasting ofStatements =15

    y

    Qualitative Measures Position of firm in industry = 10

    Account operations =10

    Management assessment =10

    System and control =5

    Maturity of obligor =5

    PRESENTED TO: MR. NOMAN SHAFI 19

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    Criteria for investors decision making

    y Investor in stock: the conclusion will help this user todecide whether the investment in stock will be profitable

    and also if that investor uses the portfolio what should itexpect

    y Debtor both financial institution & individual: theconclusion will help the lender to make the decision that is

    it feasible to lend to that particular companyy Management: the conclusion will help the management

    to make decision to improve the performance of the firm

    PRESENTED TO: MR. NOMAN SHAFI 20

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    PRESENTED TO: MR. NOMAN SHAFI 21

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    B

    usiness analysisy Pakistani economy analysisy Quantitative Measures

    Exports = 12

    Pakistan share of textile in the world = 28

    Stock market situation in Pakistan = 10

    y Qualitative Measures

    Social condition in Pakistan = 2

    Political Stability = 8

    War on terror effect = 4

    y Textile Industry

    y Quantitative Measures

    Textile share in total exports = 23

    Textile industry growth in Pakistan = 20

    Textile industry in Large scale

    Manufacturing(LSM) =9

    Cost competence of Pakistan textile = 7

    y Qualitative Measures

    Growth perspective of textile industry =8

    Threat of substitutes =8

    Threat of competition from the foreignindustries =4

    y Firms financial performanceanalysisy Quantitative Measures

    Vertical analysis =5

    Horizontal analysis =4

    Ratio analysis of individualfirm =14

    Ratio analysis with the industryaverage =19

    Future forecasting ofStatements =13

    y

    Qualitative Measures Position of firm in industry = 9

    Account operations =7

    Management assessment =7

    System and control =3

    Maturity of obligor =5

    PRESENTED TO: MR. NOMAN SHAFI 22

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    Business analysisy Pakistani economy analysis

    (12+28+10+2+8+4)*0.2 = 12.8

    y Textile Industry(23+9+7+20+8+8+4)*0.3 = 23.7

    y Firms financial performance analysis

    (5+4+14+19+13+9+7+7+3+5)*0.5 = 43y Total

    43+23.7+12.8= 79.5

    PRESENTED TO: MR. NOMAN SHAFI 23

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    PRESENTED TO: MR. NOMAN SHAFI 24

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    Recommendationsy Investor in stock: there is very good opportunity and

    future prospect for their investors in stock because the

    firm has good profitability and operationsy Investor in credit: the firm has good cash flow and

    profitably so It will be benefit for the creditor to giveshort term loan

    y

    Management: the manager has to focused onincreasing cash on hand and reduce long term debt

    PRESENTED TO: MR. NOMAN SHAFI 25

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    PRESENTED TO: MR. NOMAN SHAFI 26

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    AssumptionsIn percentage

    Sales

    forcasting 2006 2007 2008 2009 2010 Average

    %age salesincrease tren 7.6749 17.4307 24.8141 29.6274 19.88682

    Tax rate 10.0690 12.3969 3.5749 7.3424 9.0109 8.478872

    Divi en

    payout ratio 8.6559 5.42611 16.7695 0 0.05036 6.180392

    PRESENTED TO: MR. NOMAN SHAFI 27

    The current ratio and debt ratio will be same as last year 0.87 and 0.73Firms future market share price will be PKR 40

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    Adjustment of AFN

    PRESENTED TO: MR. NOMAN SHAFI 28

    AFN 1256634914

    Forecasted Additional

    New Current liabilities CA/Current ratio 4878231930 758121218

    Total liability total assets * debt ratio 7442349245 1183456880

    Long term liability total liability- CL 2564117315 425335662

    Equity total assets-total liabilities 2757743420 73178033.7

    AFN E uity+LTL+CL 1256634914

    Share capital Issued Number of share Amount

    ordinary share issue @10 1829451 18294510

    Share premium @30 1829451 54883530

    73178040

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    www.financeministry.com

    Ministry of textiles

    All Pakistan textile trade association

    SBP website

    www.quettagroup.com/home.html

    PRESENTED TO: MR. NOMAN SHAFI 29