Financial and Performance Analysis of Listed Companies of Pakistan to Draw Conclusion for Investment.

Abstract

In pursuance of carrying an aspiration to invest in one of the largest publicly listed companies rather renowned and leading in IT industries, where the comprehensive analysis of some important ratios will be calculated through the financial report of two companies to conclude which company is the best as per the analysis results to invest eventually and which company has more volatility or risk associated with it. Individual investors and some corporate managers want to buy shares and invest in the companies. To facilitate the investors, we would analyze the financial statements, including the balance sheet, income statement, and statement of owner’s equity, by calculating the ratios and developing a simple model. We shall explain them with the theory of what those results indicate so that professionals with non-financial backgrounds would have clarity on the subject matter. Furthermore, this would also emphasize managing cashflows by providing dividends to the investors and safe investments, which further discourages the term deposits and saving accounts that the companies and individuals keep in the bank for a certain time. The purpose of analyzing financial statements is to evaluate the business performance of an enterprise, its profitability, and liquidity and to identify trends and relationships between the items of the financial statements. Another important purpose of the analysis of financial statements is to find potential problem areas