Assessing Financial Performance: A Ratio Analysis of Selected Pharmaceutical Companies in India

Abstract

The financial performance analysis establishes linkages between the balance sheet and profit and loss account elements to determine the firm's financial strengths and weaknesses. The main objective of this study is to analyze and contrast the financial performance of different Indian pharmaceutical firms listed on BSE. Different profitability, liquidity, and solvency ratios are used to analyze financial performance to understand the data. These figures are derived and calculated from the financial statements of the Indian pharmaceutical firms chosen for five years, from 2017 to 2021. The findings suggest that pharmaceutical enterprises are very liquid and solvent, but profit generation is inconsistent for a few firms. To maintain their long-term viability and attract investors, companies with low ratios must improve their performance and reduce operational costs. Regulators, financial analysts, and managers interested in learning more about the financial performance of the select Indian pharmaceutical firms would find this study quite beneficial.