Profitability Analysis of FMCG Sector of India

In this research paper attempt have been made to analyses the profitability aspect of FMCG
Sector of India for the period of 10 years by taking a sample of 16 companies listed on BSE
or NSE. The financial data have been collected for the period of 10 years from 2004-2005 to
2013-2014 of 16 companies and found out 4 profitability ratios-Net Profit Margin Ratio,
EBIT Margin Ratio, Return on Capital Employed and Return on Equity. From all these
ratios researcher have worked out composite ratios by using „ paid-up share capital" as
weight and found out weighted mean of these ratios for 10 years. The researcher has used
ratio analysis and various statistical techniques such as Average, Coefficient of correlation,
Coefficient of Determination, Trend Analysis and Mann Kendal test. The study reveals that
there is efficient and profitable utilization of capital invested into the business in the FMCG
sector of India. The ROE ratio is satisfactory from the viewpoint of Equity shareholders as
far as return on their investment is concerned.