Industry Situation and Company Plans I Task

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1.0 Introduction 2

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1.1 Industry Situation and Company Plans 3
Supermarket industry current situation in Australia 3
1.2 Coles Group Limited plans 4
2.0 Shareholder analysis 5
2.1 Types of Shareholder 5
2.2 Chairman’s Views for the shareholder 6
3.0 Risk-return analysis10
3.1 Different types of Risk 10
3.2 Dividend 11
4.0 Cost of capital15
4.1 Coles Group Total Stockholders Equity 15
4.2 Coles Group WACC % Calculation 18
5.0 Financial statement analysis 19
5.1 Time Series Analysis 20
5.2 Coles Group ROA22
References 30
1.0 Introduction
Coles Group Limited is a Supermarket situated in Australia, and it works and possesses re-
tail stores (Karen, 2011). The organization's CEO is Mr John Durkan. 2014. The Company
started working in 1914, and its home office is situated in Hawthorn East, Australia. This mone-

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tary report will utilize the 2018/2019 yearly budgetary report in investigating the present circum-
stance of Coles Group Limited. The organization gives enormous assortments of retail products.
Some of the main items offered by the Coles Group Limited are; pastry shop items and bread,
vegetables and natural products, fish and meat, eggs, dairy, suppers, solidified nourishments,
family items, mixers, beverages, and washroom merchandise. Different items incorporate; busi-
ness merchandise, stationeries, infant items, tobacco, socks, gift vouchers, mobiles, and media
items. Organization's free evaluators are; Ernst and Young and Ds Lesen. Reviewers state that
the money related report of the Coles Group Limited is in concurrence with the organization's
demonstration of 2001, where it has incorporated a reasonable and genuine perspective on the
united monetary of the elements toward the finish of the financial year. Additionally, they state
that the money related report agrees to Australian Accounting Standards and the organization's
Regulation Act of 2001. They at long last infer that the budget reports are by the Global Finan-
cial detailing Standards.
1.1 Industry Situation and Company Plans
Supermarket industry current situation in Australia
Basic food item and nourishment industry in Australia is encountering solid weight from
certain powers like rivalry in the grocery store retail stores, the latent assurance in the more ex-
tensive monetary environment, changes in money valuations, and the significant expense of set-
ting up and dealing with a business in Australia when contrasted with different nations. The
quick advancement in the ALDI which offers results of high calibre at moderate prices to clients.
The Discount arrangements to clients have made ALDI progressively mainstream to customers
in Australia. (ColesGroup, 2020) The rise of ADLI has driven two grocery store Giants in Aus-

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tralia that is Coles, and Woolworths cut the prices of their items and extended its private name
merchandise ranges. Littler businesses, for example, Foodworks have been battling a ton in the
serious raising price firmly decided industry. Increasing business net revenues have dropped es-
sentially in the ongoing years as the organization's in the business have been bringing down the
prices of its merchandise to cause the organizations to stay in the market. This circumstance in
the nourishment and Grocery industry have made Coles Group industry bring down the prices of
its merchandise to keep up its clients. Different organizations in the business have been doing
likewise so they can keep their clients as well. (Morton, 2020)
1.2 Coles Group Limited plans
Coles Group Company continues offering great items to Australian residents by bringing
down the prices of the merchandise, improving the nourishment quality, guaranteeing that they
offer crisp nourishment and giving clients better shopping encounters brought about by colleague
preparing and store redesigns. (Haka and Heitger, 2012) To guarantee the above accomplish-
ments are reinforced the organization intends to do the accompanying in the anticipated years;
(Brown, 2011) First, Construct a superior system of the store and increment the objective general
store framework space advancement by 2-3% every year. Besides, in guaranteeing the freshness
of nourishments, the organization intends to convey top-notch nourishment to each store inside
Australia, look for long haul contracts and more prominent joint efforts with the primary
providers of the nourishments and elevate part preparing to animate help conveyance to clients.
Thirdly, to help the organization in turning into a believed pioneer organization, the organization
means to bring down the expense acquired in the week by week shopping containers and support
focused on showcasing utilizing client discernments and fly buys. Fourthly, to streamline the

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stockpile anchors the organization intends to convey better production network efficiencies
through improved long haul start to finish planning, progressed direct inventory source abilities
and exchange terms and conditions. (Aharony, Barniv, and Falk, 2010).
2.0 Shareholder analysis
2.1 Types of Shareholder
The enormous shareholder group in Coles Group Limited (ASX: COL) have control over the or-
ganization. Huge organizations generally have foundations as shareholders, and as a rule, see in-
siders owning shares in litter organizations. Organizations that have been privatized will, in gen-
eral, have low insider possession. Coles Group is an entire large organization. It has a market
capitalization of AU$16b. Typically foundations would claim a critical bit of an organization this
size. Foundations commonly measure themselves against a benchmark when answering to their
financial specialists, so they frequently become progressively energetic about a stock once it's re-
membered for a significant list. We would anticipate that most organizations should have a few
establishments on the register, particularly if they are developing. (ColesGroup, 2020)
We can see that Coles Group has institutional financial specialists, and they hold 12% of the
stock. This can demonstrate that the organization has a specific level of believability in the ven-
ture network. In any case, it is ideal to be careful about depending on the alleged approval that
accompanies institutional speculators. They as well, fail to understand the situation in some
cases. At the point when various establishments possess a stock, there's constantly a risk that
they are in a 'swarmed exchange'. At the point when such an exchange turns out badly, different
gatherings may contend to sell stock quickly. This risk is higher in an organization without a
background marked by development. (Coles CEO eyes return to profit growth by 2021, 2020)

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You can see Coles Group's notable profit and income, underneath, however, remember there's in
every case more to the story. The overall population — generally retail speculators — possess
73% of Coles Group. With this size of proprietorship, retail financial specialists can, on the
whole, assume a job in choices that influence shareholder returns, for example, dividend strate-
gies and the arrangement of executives. They can likewise practice the ability to decay an acqui-
sition or merger that may not improve benefit. (St, 2020)
2.2 Chairman’s Views for the shareholder
As a huge Australian organization, Coles is focused on working in a way that is straightforward
and constructs trust with its group, its clients and its locale. They perceive the expanding desires
for every one of our partners whose help and commitment are basic to our suffering achieve-
ment. With the help of the Board and supervisory crew, they anticipate the difficulties ahead and
expand upon the commitments of every one of the individuals who supported our first century.
(ColesGroup, 2020)
They are grateful to their Board for their help during a time of critical change and for applying
their significant abilities and bits of knowledge to the significant undertakings of administration
and setting our future course. Hence, the institutional investors and the big corporates are quite
satisfied with the company and the way they treat their shareholders. In fact, the chairman in
2019 has specially mentioned the corporation of the shareholder's efforts for the expansion plans.
This shows gratitude to their investors hence, big companies like CitiCorp, HSBC, etc are satis-
fied to be a part of Coles Group.
2.3 Top 20 Shareholdings

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Coles Group Limited Number of
fully paid
shares
% of is-
sued
capital
Marginal and
Non - Marginal
Investor
1. HSBC Custody Nominees (Aus-
tralia) Limited
268,471,371 20.13 Non- Marginal
2. Wesfarmers Retail Holdings Pty
Ltd
200,089,454 15.00 Non- Marginal
3. J P Morgan Nominees Australia Pty
Limited
184,124,225 13.80 Non- Marginal
4. Citicorp Nominees Pty Limited 82,237,368 6.17 Non- Marginal
5. National Nominees Limited 40,294,153 3.02 Non- Marginal
6. BNP Paribas Nominees Pty Ltd <
Agency Lending DRP A/C>
21,010,992 1.58 Marginal
7. BNP Paribas Noms Pty Ltd <DRP> 16,969,772 1.27 Marginal

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8. HSBC Custody Nominees (Aus-
tralia) Limited <NT-Comnwlth Su-
per Corp A/C>
9,984,003 0.75 Marginal
9. Australian Foundation Investment
Company Limited
6,722,500 0.50 Marginal
10. Citicorp Nominees Pty Limited
<Colonial First State
6,555,777 0.49 Marginal
11. HSBC Custody Nominees (Aus-
tralia) Limited- GSC
5,299,201 0.40 Marginal
12. ARGO Investments Limited 5,040,027 0.38 Marginal
13. Woodross Nominees Pty Ltd 3,707,841 0.28 Marginal
14. AMP Life Limited 3,166,599 0.24 Marginal
15. HSBC Custody Nominees (Aus-
tralia) Limited
2,902,623 0.22 Marginal