Analysis and Future Prediction of Financial Ratios in the Cement Sector

Abstract: This report analyzes and forecasts six important financial ratios-Net Profit Margin (NPM), Return on Net Worth (RONW)-for the period from 16 to 25 using time series data available up to period 15. The study uses time series methods, along with residual analysis like ACF and PACF, to check how well the models fit the data. The results show that profitability measures like NPM and RONW are expected to increase gradually and reach stable levels over time, although the wide confidence ranges indicate some uncertainty in these predictions. Efficiency and activity ratios such as FATR and ITR show slight declines before stabilizing, while liquidity ratios like CR and QR remain mostly steady after small initial changes. The graphical trends also support the idea that most ratios are moving towards stability, and the residual analysis suggests that the models used are reasonably reliable. Overall, the findings provide a clear view of expected future financial performance, which can be helpful for planning, while also pointing out areas where predictions may be less certain.

Keywords: Time series forecasting, analysis of financial ratios such as Net Profit Margin, Return on Net Worth, Fixed Asset Turnover, Current Ratio, Quick Ratio, and Inventory Turnover, along with tools like autocorrelation and partial autocorrelation functions and residual analysis for checking model accuracy.