ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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SUNDARAM FINANCE-In the Forefront

preceding year. The deterioration was caused mainly by pressure on margin on sales which was lower at 5.34 per cent (5.77 per cent). The spurt in expenses raised the expenses- to-sales ratio from 0.88:1 in 1988 to 0.90:1 in 1989 which lowered the rate of return on sales. A 20 per cent rise in raw material cost, a 44 per cent increase in employees' cost and a 19 per cent increase in other expenses out' paced the 19 per cent growth in sales in 1989. The funds management was characterised by an almost steady debt/equity ratio (0.56:1 in 1989 as against 0.57:1 in 1988). However, the current ratio of 1.77:1 as against 1.88:1 in the preceding year reflected disproportionate growth in current liabilities as compared to current assets. The company could improve the interest coverage from 4.59 times to 6.12 times.

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