Analysis: Financial Ratios and Proton

Topics: Financial ratios, Automotive industry, Financial statements Pages: 19 (7037 words) Published: July 8, 2013
PART A (I)
In an organization, there must exist core business activities to function properly. Hence, the core business activities of Proton Holdings Berhad are engaged to automotive industry. It is no doubt that Proton Holdings Berhad is Malaysia’s leading automotive manufacturer (Home, n.d.). Proton Holdings Berhad had produced many car models which included Inspira, Exora, Saga FL, Persona and other models that received great responses from the market (Corporate, n.d.). For instance, Proton Inspira was getting 2nd place in the Family Cars Category at the Asian Auto Fuel Efficiency Award 2010 during 24 February 2011 (Awards & Recognition, n.d.). Proton Persona also awarded for 2011 Frost & Sullivan Malaysia Excellence Award for the category Value-for-Money Car of the Year during 13 April 2011 (Awards & Recognition, n.d.). It is clearly indicated that the Proton car model has its assurance on its quality and value. Although Proton Holdings Berhad is the leader of automotive manufacturer with 25 years of experience in the automotive industry, it also facing a tough competition in Malaysia from different competitors. The competitors included Perodua, Toyota, Honda and other automotive manufacturers had draw some of the market share from Proton Holdings Berhad. The table below indicates that the market share of Proton Holdings Berhad had been reduced to a certain level. Although the sales unit of Proton Holdings Berhad is increased during 2008, it is not enough for Proton Holdings Berhad to claim the largest market share and maintained in second place. This is because the sales unit of other car manufacturers is increasing simultaneously with Proton Holdings Berhad (Appendice 1). Furthermore, Proton Holdings Berhad has its head office and plant. Its head office is located in Shah Alam while the factory is located in Tanjung Malim. The plant was equipped with high efficiency and consistency of automation combined with the experience and diplomacy of manual practices (Khong, 2011). It is integrated with a skilled workforce of 2000 personnel and 180 precision robot which enable the workers and robots work together in a safe, efficient and productive manner (Khong, 2011). An annual capacity of 150,000 units with a 60 percent of automation level is having by the plant (Tanjung Malim Plant, n.d.). The plant also has the capabilities to produce multi car models on a common line in order to allow greater production flexibility (Tanjung Malim Plant, n.d.).

PART A (II)
Nowadays, automotive industry has become one of the most important industries in the manufacturing sector in Malaysia. Therefore, a lot of future prospects had been planned by Proton Holdings Berhad. The first thing is to launch Proton hybrid car which has the characteristics of electric and environment-friendly (Group Managing Director's Review, n.d.). Proton Holdings Berhad decided to be involved in the hybrid and Electric Vehicle is due to the strategic in nature (Group Managing Director's Review, n.d.). By the way, Proton Holdings Berhad has been committed to the development of green technology in line with the initiative of government to establish Malaysia as a regional hub for hybrid car (Group Managing Director's Review, n.d.). According to Group Managing Director of Proton Holdings Berhad Dato’s Sri Haji Syed Zainal Abidin B Syed Mohamad Tahir, he has the confidence that the new Proton hybrids have the abilities to compete with other competitors that had launch their hybrid cars in the market. Besides, Proton Holdings Berhad has the intention to become the center of Malaysia’s green initiatives and set up the nation as a premier green-tech innovation centre (Group Managing Director's Review, n.d.). Moreover, Proton Holdings Berhad also put their attention to exports in time to come. In fact, the strategy of Asian Multi-Local OEM (AMLO) has been implemented by Proton Holdings Berhad to turn around an ailing domestic giant into a genuine global...

References: Bursa Malaysia. (2011). Proton annual report 2009. Retrieved February 5, 2012 from
http://announcements.bursamalaysia.com/EDMS/subweb.nsf/7f04516f8098680348256c6f0017a6bf/7cda1389652c5a8f48257603003440db/$FILE/PROTON-Page%2081%20to%20ProxyForm%20(3MB).pdf
Proton Holdings (2012). Awards & Recognition. Retrieved Feb 20, 2012, from http://www.proton.com/About/Corporate/Awards---Recognition/List-of-Awards.aspx
Proton Holdings (2012)
Proton Holdings (2012). Group Managing Director 's Review. Retrieved Feb 20, 2012, from http://www.proton.com/About/Corporate/Governance/Managing-Director-s-Review.aspx
Proton Holdings (2012)
Proton Holdings (2012). Tanjung Malim Plant. Retrieved Feb 20, 2012, from http://www.proton.com/About/Manufacturing/Tanjung-Malim-Plant/The-Plant.aspx
YAHOO! FINANCE
Negishi, M. (2011, September 13). UPDATE 1-M 'bishi Motors may expand alliance with Malaysia 's Proton, Reuter, Retrieved February 5, 2012 from
http://www.reuters.com/article/2011/09/15/mmc-proton-idUSL3E7KF0YP20110915?type=companyNews
Reuter (2011). PROTON Holdings Bhd, Retrieved February 5, 2012 from
http://www.reuters.com/finance/stocks/overview?symbol=PROT.KL
Chong.E.N.(2011,December6). Proton counter soars on talk of Khazanah divesting stake. The Star. Retrieved February 10,2012 http://biz.thestar.com.my/news/story.asp?file=/2011/12/6/business/10037299&sec=business
Appendice
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