Financial Assessment of Medibank Pvt Ltd

Running head: FINANCE FOR BUSINESS
Medibank Pvt Ltd
Name of the Student:
Name of the University:
Author’s Note:

2FINANCE FOR BUSINESS
Executive Summary
The aim of the assignment is to conduct a financial assessment of the Medibank Pvt Ltd and
assess the financial condition of the company in various aspects of the company. The
financial analysis of the company was conducted by taking the profitability, liquidity and
market value ratio for the company. The share price analysis of the company in respect to the
benchmark index of the company was also analysed for the company. The cost of equity for
the company was calculated by deriving the beta of the company. The capital structure of the
company was also analysed for the company by taking the exposure of debt and equity
exposure into account for the company.

3FINANCE FOR BUSINESS
Table of Contents
Introduction................................................................................................................................4
Discussion..................................................................................................................................5
Financial Ratio.......................................................................................................................5
Liquidity Ratio...................................................................................................................5
Profitability Ratio...............................................................................................................7
Market Value Ratio............................................................................................................9
Share Price Movement.........................................................................................................10
Cost of Equity......................................................................................................................12
Capital Structure...................................................................................................................13
Conclusion................................................................................................................................14
Recommendation......................................................................................................................14
References................................................................................................................................16

4FINANCE FOR BUSINESS
Introduction
The national private health company operating in the Australian health industry
Medibank Pvt Ltd was analysed for assessing the financial performance of the company. The
operations of the company is widely dispersed after having a substantial amount in the
insurance sector of the Australian economy where the company is the second largest
insurance company in the industry (Annual Report 2018). The company has a 29.1% of the
market share for the industry having a wide base of operations with variety of products and
service that the company serves. The various products and services which the company caters
is related to the health insurance, pet insurance, life insurance, work place health management
and health call centres of the company. The company is located and headquartered in
Melbourne, Australia where the company controls the major of its activities and operations of
the company. The Medibank Private Ltd is listed in the Australia Stock Exchange and the
stock is traded on the exchange with its ticker symbol MPL. The market in which the
company operates is competitive where the company faces tight competition from other key
players and companies operating in the industry (Vogel 2016). The wide employee base of
the company are some of the key important aspects that the company would be benefited in
the terms of the operations and resources utilisation. The financial statement for the company
for the trend period 2017 and 2018 was taken into consideration for the purpose of the
analysis. Australian Health Management is the key subsidiary of the company helping the
company in widening the operations of the company. Ratio analysis and cots of equity are
some of the common aspect that should be taken into consideration for the purpose of the
analysis of the financial statement of the company. The capital structure of the Medibank
Company was also taken into consideration for the purpose of the analysis of the financing
structure of the company and assessing the debt and equity structure of the company
(Dewachter et al. 2015).