CHAPTER 5: CONCLUSION

5.1 Pakistan Cables Ltd. (2016-2021)

 Overall growth rate of current assets over the period of 5 years is more than non-current assets except in

2019 and 2020 where growth rate of current assets declined to 1.95% and (15.60%) respectively. Share

capital reserves growth remained steady in given 5 years as compared to current and non-current

liabilities where fluctuations were abrupt. Whereas impact of capital share and reserves on total

liabilities and equity is five times more than what non-current assets have and way more than current

assets as well.

 Gross profit, profit after tax and profit before tax gained from net sales grew steadily over the years

except for 2019 and 2020 where impact of Covid-19 had negative impact in production phase due to

lack of working days thus effecting major components of income statement adversely.

 Analysis of expenses suggests that impact of cost of sales on net sales averages nearly 95%. Whereas

impact of other expenses such as marketing, selling, distribution, administration and finance costs on the

net sales is 5% only. Expenses such as marketing, selling, distribution and administrative costs at

Pakistan Cables grew steadily over the years.

 Net working capital, current ratio and quick ratio grew steadily until 2019 after that it declined because

of rise in current liabilities as a result of Covid-19 which deteriorated this ratio adversely. Gross profit,

profit margin, return on total assets and on equity were improving until 2017 but then it slightly declined

and in 2020 it reached lowest recorded in 5 years due to adverse impact of Covid-19 on the growth of

net income. Which clearly indicates that Pakistan Cables scored financial loss instead of profit in fiscal

year 2020.

 Debt ratio and debt equity ratio mostly remain stable at Pakistan Cables over the period of 5 years.

Financial leverage ratio increased over 1 only in 2021 due to accumulation of excessive debts and

liabilities which they were liable to pay.

book ratio (times) all these marketability ratios increased steadily until 2017, after which it slightly

declined and in 2020 it recorded lowest due to adverse effect of Covid-19. Dividend payout and its yield

ratio increased progressively over the years until 2020 where it declined but it improved rapidly in 2021.

Another factor which influenced growth of marketability ratios was General Cables 24.6% shareholding

in Pakistan Cables from 2010-2017.

 Activity ratios such as inventory turnover and account receivables turnover at Pakistan Cables was

improving steadily until 2019 but in 2020 it declined due to adverse impact of Covid-19. Operating and

cash conversion cycles age increased in 2019 and 2020 due to increase in average age of inventory and

collection period. But these activity ratios improved back in 2021.

5.1.1 Summary

Pakistan Cables Ltd. overall growth rate in all aspects was improving from given period of 2016-2019 but it

started to deteriorate in 2019 and 2020 due to adverse impact of Covid-19 and global market high inflation

rates. By 2021, Pakistan Cables improved its growth as production phase was rapid and started to work at its

full potential. Pakistan Cables not only provides cable related services to WAPDA, K-Electric, DISCOs and

NTDC but also exports its goods and products abroad primarily Middle East and Africa. General Cables had

shares in Pakistan Cables from 2010-2017. So, through effective strategy of collaborative partnerships with

other internationally renowned firms and other cable manufacturing companies Pakistan Cables can improve its

reputation and financial aspects.

 Gross sale for the year 2018 was the most, which was of about 115.158% but we also saw an increase in

taxation which was 449.30%. sales decreased for the following years till the year 2021 where it

increased 20.44% after seeing a decrease growth in sales for the year 2020 of about -12.26%. Decrease

seen in 2020 was because of global pandemic known as Covid-19. However, the increase seen in year

2021 was due to the change in strategies by the management of the company.

 Taxation was also down to -41.75% for the year 2020, which later increased 31.11% for the year 2021.

However, we saw an increase of 157.231% in profit after taxation for the year 2021, which was the most

observed during the considered years.

 However, we saw a consistency in other income during the year 2020 and 2021, i.e. there was no

increase or decrease in other income account for year 2021. This was after a significant growth of

196.151 in 2020.

 We saw some decrease in Admin, Marketing, Selling and Distribution Expenses but it was negligible

compared to other items we observed during the years 2019 and 2020. Overall we saw an increase in

expenses, expense account of 2021 increased more than what they were in 2017.

 We saw a decrease in non-common liabilities in 2021, this was mostly because of decrease in long term

loan and 48.88% decrease in liabilities against assets subject to finance lease, also because of 62.73%

decrease in deferred income, which means more deliveries were made and more income was transferred

from deferred income to income account.

 Company paid some of the unpaid dividend, due to which we saw constantly increasing trend in current

liabilities. With the exception of the year 2018, the increase was more than 25%. Overall growth rate of

total liabilities was decreasing gradually over period of 5 years.

 We observed an increasing trend in assets with an exception of 2020.

 A decrease was seen in overall collection period of the company, it decreased from 159.45 days to

111.88 days in 2021. Inventory turnover increased from 1.67 to 2.29.

8.50 in 2017 to 3.14 in 2021, respectively.

 However, EPS was highest for 2018 and least for 2020, where it started to increase in 2021 with 1.13.

5.2.1 Summary

During the FY21, Waves Corporation showed healthy growth due to overall economic growth and high foreign

remittances. The electrical home appliances demand surged with growing disposable incomes and restoration of

consumer confidence. With growth in the new housing societies under the Government policy also brought a

significant increase in the consumer goods. The Pakistan Bureau of Statistics (PBS) has reported around 90%

increase in the refrigerators production, air conditioners around 140% and deep freezers around 45%. With the

changes in the overall weather conditions surges in refrigeration and air conditioning is experienced.

WAVES Corporation Ltd. Showed overall growth in all aspects, however we saw a significant decrease during

the perilous times of Covid-19. We can see this period as an opportunity, which gave the company an

opportunity to reinvent itself and reintroduce itself in the market.