Vol. 11, Special Issue 4 (2022)

Author(s):
Nandini HM, Dr. PS Badal and Anil K

Abstract:
The study is an attempted to evaluate the financial performance of Farmer Producer Organizations (FPOs) in Eastern Dry Zone of Karnataka. Financial ratio analysis of Farmer Producer Organizations has been done on the financial ratios such as Net profit, Current ratio, Net capital ratio, Earnings per Share, Returns on Assets, Returns on Equity, Debt-Equity Ratio for the financial year 2019-20. Financial ratio analysis shows that Anekal Horticulture Farmer Producer Company Ltd. (AHFPCL) and Rajaghatta Horticulture Farmer Producer Company Ltd. (RHFPCL) was having higher annual net profit i.e. Rupees 4,36,780 and 3,14,347 respectively. Then the Current ratio of all the four FPOs shows (>1) indicating financially sound and adequate to manage their short-term obligations. Net Capital ratio of all the FPOs found to be (>1) indicating long run liquidity of the business, where Sri Venugopalaswamy Horticulture Farmer Producer Company Ltd. (SVHFPCL) was having very high ratio i.e. 43.75 and Tubagere Horticulture Farmer Producer Company Ltd. (TFPCL) was having very low ratio i.e. 1.37. Earnings per share is found higher in Anekal Horticulture Farmer Producer Company Ltd. (AHFPCL) and Rajaghatta Horticulture Farmer Producer Company Ltd. (RHFPCL) i.e. Rupees 436 and 314 respectively and other Profitability ratios such as Returns on Assets, Returns on Equity, was found to be higher indicating business able to utilize its resources well in generating income. Moreover, Debt-Equity Ratio found to be (<1) for all the FPOs indicating less debt and reduced risk in the business.