Financial Market Stabilization and Risk
Added on 2020-06-04
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Principals of FinancialMarket
EXECUTIVE SUMMARYIf a company manage their financial resources in correct manner than they can earn moreprofit in short period for time. Economic environment of a country have capacity to derailoperation of an enterprise. Their are various accounting ratios which can help an enterprise inascertaining their current position. If a firm manage their resources in appropriate manner thenthey can get surprising return in short period for time. This is essential for attaining mission andvision of an organisation.
Table of ContentsEXECUTIVE SUMMARY.............................................................................................................2INTRODUCTION...........................................................................................................................1TOP-DOWN ANALYSIS...............................................................................................................1BOTTOM-UP ANALYSIS.............................................................................................................5SUMMARY AND RECOMMENDATIONS..................................................................................7REFERENCES................................................................................................................................9
INTRODUCTIONAn organisation with sound financial position can face any kind of difficult that is presentin an business environment. Finance department of a company mainly focus on two areas, first islowering down the cost of capital, by finding right source of money, and second is investing rightareas so an enterprise can do optimum utilisation of available resources. Fashion retail industryin Australia is going through favourable changes which can be considered as the main reasonsthat multinational organisation from different nations are entering in this emerging market.Oroton group and MYER are leading companies of this industry (Park and Sabourian, 2011).Prior one operates in more one country and later one keep their focus on only domestic market.This assignment will discuss about economic environment where these firm are operating. Topdown and Bottom up analyses will become key part of this report. Some accounting ratios andmeasures will be explained under this file. TOP-DOWN ANALYSISAustralian companies are not very popular in global fashion retail market. Their are manysmall firms in who have done well in domestic country but they failed to make a significantimpact at global level. The reason behind this failure is high internal competition. According tothe report by IBIS, fashion industry is generating a revenue of $19bn. They are providingemployment to around 130,000 employees. In last five years, this sector has seen a growth of3.9%. Some people are happy that foreign companies are entering in this industry, this will bebeneficial for customers as they will get cloths in best prices but some are not happy entry ofmultinational firm because they believe that in present situation, there is a high competition inthis sector. If more enterprises, with deep pocket, will enter in this market than it will hamper thegrowth of industry as well as the small firm who are operating in it. The population of Australia is around 24 million. Their labour force is 12.2 millionapprox. and unemployment rate stand around 5.7%. Their GDP per capita is 75,681 Australiandollar approximately. Fashion industry, including textile, leather and footwear, is providing jobsto almost 37000 people (Mao, Counts and Bollen, 2011). Market value of this sector is 28.5billion Australian dollars, it is a rough estimation. Stock price play critical role in determiningthe future success or failure of an organisation. MYER has seen continuous falling in their stockprice, their management took several step to cope up with this problem but it is continuously1
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