Financial Analysis of Attock and Pakistan Petroleum Limited

Abstract

Financial performance and status hold significant importance for any company as they provide a broad perspective on assessing strengths and weaknesses. The information obtained from financial ratio analysis not only aids managers in decision-making but also enables stakeholders to make informed choices. This study focuses on conducting a financial ratio analysis of Attock Petroleum Limited and Pakistan Petroleum Limited, utilizing data from their financial statements over a 5-year period. The findings indicate that both APL and PPL have demonstrated strong profitability over the past five years, attributed to effective management performance and a reputable presence in the fuel and lubricants industry. Both Attock and Pakistan Petroleum Limited specialize in the production of a wide range of petroleum, natural gas, motor fuels, and engine oil products, among others. They are recognized for their strategic strength and product innovation within the market. Both companies have adapted dynamically to changing consumer preferences, demands, and choices. Ratio analysis necessitates the comparison of interrelated figures over multiple years to identify patterns. There is no universal ratio that can serve as a benchmark for analyzing a company's financial statements. In fact, different businesses select and implement ratios based on their specific nature and objectives. For example, banks typically analyze a company's financial performance over the past three years through ratio analysis to assess operational efficiency. Therefore, banks select ratios that align with their objectives and represent the core aspects of the business being evaluated.