HA1022- Principals of Financial Markets Group
Added on 2019-10-31
18 Pages4109 Words183 Views
Principles of Financial Markets1“Principles of Financial Market”
Principles of Financial Markets2Executive SummaryThe report analyses the impact of economic factors such as GDP, interest rate and inflation rate on the profitability level of airline industry and air companies in Australia. The financial health of Qantas and Virgin airlines is calculated on the basis of various ratios such as profitability, efficiency, capital structure, liquidity ratios and market value ratios. These ratios are helpful for an organization to evaluate the structural position in the financial market.
Principles of Financial Markets3Table of ContentsExecutive Summary.........................................................................................................................2Introduction......................................................................................................................................4Brief History of Air Travel Industry................................................................................................5History and Mission statement of Companies.................................................................................5Virgin Atlantic.............................................................................................................................5Qantas Airways............................................................................................................................5Top-down Analysis..........................................................................................................................6Current GDP rates........................................................................................................................6Current Interest Rate....................................................................................................................6Current Value of $AUD...............................................................................................................7Inflation rate.................................................................................................................................7Personal Disposable Income........................................................................................................8Bottom up Analysis:........................................................................................................................8Liquidity Ratios............................................................................................................................8Profitability Ratio.......................................................................................................................10Efficiency Ratios........................................................................................................................11Capital Structure Ratios.............................................................................................................13Market Value Ratios..................................................................................................................14Overall analysis of Qantas and Virgin...........................................................................................15Conclusion and Recommendations................................................................................................16References......................................................................................................................................17
Principles of Financial Markets4IntroductionThe aim of this report is to provide an understanding of fundamental analysis of airline industryas well as the selected companies that are Virgin airline and Qantas Airways. In addition to this,the report conducts a top-down analysis of the overall economic environment of the selectedcompanies that includes the fundamental impact on the performance of selected industry andcompanies. For this, the report analysis the current Gross domestic product, inflation rate,interest rate, exchange rate and personal disposable income in Australia. On the other hand, thereport also conducts bottom down analysis of the financial situation of the companies and airlineindustry. The ratios analyze the performance of the selected companies. The bottom downanalysis helps in the comparative analysis and to finding out the more profitable company.
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