A Study on Financial Statement Analysis of Alamelu Steel Company, Salem

Financial statement analysis is a critical tool for assessing the performance, liquidity, and solvency of industrial enterprises. This study evaluates the financial performance of Alamelu Steel Company, Salem, Tamil Nadu, for the five-year period from 2020–21 to 2024–25. Using secondary data drawn from the company’s annual reports and balance sheets, the study employs ratio analysis, trend analysis, and comparative balance sheet methods. Key financial ratios including current ratio, fixed assets ratio, liquidity ratio, debt-equity ratio, return on assets, debtors turnover, inventory turnover, and working capital turnover are analyzed. The findings reveal that the company has demonstrated a steady improvement in profitability and liquidity over the study period, with net profit growing from a loss of Rs. 361.61 lakhs in 2020–21 to a profit of Rs. 8,283.42 lakhs in 2024–25. While debt-equity ratios show a declining trend indicating reduced financial leverage, the current ratio and return on shareholders’ funds have improved substantially. The study concludes with suggestions for strengthening liquidity management and optimizing working capital utilization.