Measuring the Financial Performance of Rahimafrooz Energy Service Ltd

Abstract

In this report, the financial statement of Rahimafrooz Energy Service Limited performance has been analyzed. Rahimafrooz Energy Service Limited was examined on how it manages its performance and what is the current condition of the company in terms of its financial position. All the data used in the report are primary data mostly collected from the Finance & Accounts Department through interview and financial ratios and graphical representation of the ratios in the report was done using Microsoft Excel 2016. The report’s first chapter contains introduction and second chapter contains 4 techniques which includes horizontal analysis, vertical analysis, ratio analysis and DuPont analysis. Ratio analysis was done under five dimensions; these are liquidity dimension, profitability dimension, solvency dimension, efficiency dimension and market value dimension. Total 40 ratios were analyzed. These techniques have been used to measure the performance of the company. Liquidity ratio shows Rahimafrooz Energy Service Ltd has a better ability to satisfy its debt obligations. Profitability ratio shows Company growth health is not good. Solvency ratio shows Rahimafrooz Energy Service Ltd had been forceful in financing its development with debt. Efficiency ratio summarizes the organization isn't utilizing its assets effectively and probably have production problems. Market ratio shows that stock's price of Rahimafrooz Energy Service Ltd was low relative to earnings and possibly undervalued. DuPont Analysis shows that Rahimafrooz Energy Service is ready to extend its ROE just because of increase in financial leverage, it’s risky since the organization is ready to extend its assets by taking debt.