GSK_ Annual_Report_2021-22

GlaxoSmithKline Pharmaceuticals Limited | Annual Report 2021-22 Notes to the Standalone Financial Statements for the year ended March 31, 2022 168 Note 56 : Key Financial Ratios Ratio Numerator Denominator Mar-22 Mar-21 Variance Reason for variance 1 Current Ratio Current assets Current Liabilities 2.19 1.51 45% Mainly on account of cash received from sale of brands and other identified assets 2 Debt Equity Ratio Debt Shareholders Equity 1% 2% -1% 3 Debt Service Coverage Ratio Net profit after tax plus interest cost minus non- operating income and non cash income Interest & lease payments +Principal payments 21.57 23.71 -9% 4 Return on Equity Profit after tax Shareholders Equity 22% 26% -4% 5 Inventory Turnover Ratio Sale of Products Average inventories 6.73 6.28 7% 6 Trade Receivables Turnover Ratio Sale of Products Average trade receivables 16.58 20.04 -17% Mainly on account of higher receivables subsequently realised. 7 Trade Payables Turnover Ratio Cost of Goods Sold + Expenses Average trade payales 4.18 4.69 -11% 8 Net Capital Turnover Ratio Sale of Products Working Capital 1.75 4.70 -63% Mainly on account of cash received from sale of brands and other identified assets 9 Net Profit Ratio Profit after tax Revenue from operations 12% 17% -5% Mainly on account of tax adjustments of earlier years 10 Return on Capital Employed Profit before tax Net Worth 43% 36% 8% 11 Return on Investment Gain on Investment Total Investments 3% 5% -1% Due to reduction in fixed deposit rates. Notes : (i) Ratios are calculated including profits from discontinued operations but excludes the impact of sale of brands and identified assets and other exceptional items (Refer Note 40 and 55). (ii) Return on Equity excluding impact of tax adjustments of prior years is 28.69%. (iii) Net Profit ratio excluding impact of tax adjustments of prior yearsis 17.19%. Note 57 : Consequent to the approval of the shareholders, the Company on September 30, 2021, has acquired the assets and liabilities associated with the vaccine business of GlaxoSmithKline Asia Private Limited. The Company has accounted the acquisition in accordance with Appendix C to IND AS 103 being business combination of entities under common control. Accordingly, the financial information in respect of prior periods has been restated for the acquisition as if the business combination has occurred from the beginning of preceding periods.The Company has taken over the assets at amortised cost of ` 1,29.00 lakhs, liabilities taken over at ` 20,44.00 lakhs and the consideration paid amounts to ` 1,66.00 lakhs. The difference between the consideration paid and the net assets taken over on acquisition of ` 20,82.00 Lakhs has been transferred to Capital reserve.