1. Welcome to our Presentation On Cross sectional analysis Welcome to our Presentation On Cross sectional analysis Bextex Ltd and Prime Textile Ltd.

2. Company overview of Beximco Textile. Vision Use “Innovation” & “Speed” as prime drivers, rather than cotton & cheap labor. Mission BEXTEX Ltd. is a full service vendor with strong vertically integrated production facilities as well as creative & analytical capabilities which clearly set us apart from most other South Asian vendors.

3. Cross sectional analysis Between Prime textile & Bextex Ltd. Cross sectional analysis Between Prime textile & Bextex Ltd.

4. Liquidity Ratio

5. Current Ratio Current ratio for bextex in 2009 = Current assets/Current liabilities = 7230982538/7906937639 = 0.91:1 Current ratio for prime in 2009 = Current assets/Current liabilities = 1044816449/982894151 = 1.063:1

6. Quick Ratio Quick ratio for bextex in 2009 = (Current asset-inv)/Current liability = ( 7230982538-2733063864)/7906937639 = 0.57:1 Quick ratio for prime in 2009 = (Current asset-inv)/Current liability = (1044816449-565487208)/982894151 = 0.487:1

7. Activity Ratio

8. Inventory Turnover Inventory turnover ratio for Bextex in 2009 = cost of goods sold / inventory = 3090184887/2733063864 = 1.13 times Inventory turnover ratio for prime in 2009 = cost of goods sold / inventory = 1391832663/565487208 = 2.46 times

9. Average collection period Average collection period for bextex in 2009 = AR /Average sales per day = 3765912622 / (4760237289/365 days) = 3765912622/13041746 = 289 days Average collection period for prime in 2009 = AR /Average sales per day = 337442913/ (1578386314/365 days) = 79days

10. Total Asset turnover Total Asset turnover for bextex in 2009 = sales / total asset = 4760237189 / 19086298350 = 0.25 times Total Asset turnover for prime in 2009 = sales / total asset = 1578386314/2624139237 = 0.601 times

11. Debt Ratio

12. The debt ratio for bextex in 2009 Debt ratio = total liabilities/ total assets = (1475056051/2624139237)*100 = 56.2% The debt ratio for prime in 2009 Debt ratio = total liabilities/ total assets = (15733786518 / 19086298354)*100 = 82% Debt ratio

13. Debt to Equity Ratio The capital structure of prime in 2009 D/E ratio = total liabilities/ total equity = (15733786518 / 1149083186) = 1.28:1 The capital structure of bextex in 2009 D/E ratio = total liabilities/ total equity = (15733786518 / 3352511840) = 4.69:1 Bextex 56% 44% debt capital equity capital Prime Textile 82% 18% debt capital equity capital

14. Time Interest Earned Ratio Time Interest Earned Ratio of prime in 2009 = EBIT / Interest = 86918644 /37493611 = 2.318 times Time Interest Earned Ratio of bextex in 2009 = EBIT / Interest = 692000803/ 1300656669 = 0.53

15. Profitability Ratio

16. Gross profit margin Gross profit margin of prime in 2009 = (sales – cogs) / sales = Gross profit/sales =186553651 /1578386314 = 11.8% Gross profit margin of bextex in 2009 = (sales – cogs) / sales = 1670052302 / 4760237189 = 35%

17. Operating profit margin Operating profits margin of prime in 2009 Operating profit margin= operating profit / sales = 86918644/1578386314 = 5.51% Operating profits margin of bextex in 2009 Operating profit margin= operating profit / sales = 692000803/ 4760237189 = 14.54%

18. Net profit margin The net profit margin of prime in 2009 Net profit margin = EACS / Sales = 71090507 / 1578386314 = 4.5% The net profit margin of bextex in 2009 Net profit margin = EACS / Sales = (608655866) / 4760237189 = (0.13)

19. Earnings Per Share EPS of Prime Textile in 2009 EPS = EACS/ no. of common stock = 21.89 taka EPS of bextex in 2009 EPS = EACS/ no. of common stock = (3.23) taka

20. Return on Equity ROE of Prime Textile in 2009 ROE = EACS / Common stock equity = 71090507 / 1147201594 = 6.19% ROE of Bextex in 2009 ROE = EACS / Common stock equity = (608655866) / 3352511836 = (19%)

21. Return on Total Assets (ROA) ROA of Prime Textile in 2009 ROA = EACS / Total asset = 71090507 / 2624139237 = 2.71% ROA of bextex in 2009 ROA = EACS / Total asset = (608655866) / 19086298354 = (0.03)

22. Findings  The debt capital of Prime Textile possesses higher risk.  The higher interest payment also affects the return on total assets of Bextex.  Earnings per share of Bextex (3.23) is less than the Prime Textile 21.89 because their net profit hugely decline from operating profit because of higher interest payment.

23. Recommendations  The Prime Textile should increase their debt capital slightly more than 50% in order to reduce the chance of hostile takeover from another company.  The debt capital of Bextex should be slightly declined to reduce the financial distress cost.  The debt capital should be declined to reduce the interest payment that adversely affect in profitability ratio of Bextex.

24. Thank You All