ETHICAL COMPLIANCE REPORT

ROYAL ORCHID HOTELS

Sector:

Consumer Cyclical

Industry:

Lodging

Overall Compliance

questionable

PRIMARY BUSINESS FILTER
Hotels
questionable
REVENUE RATIO FILTER
33.2%
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DEBT RATIO FILTER
42.5%
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LIQUIDITY RATIO FILTER
10.9%
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Revenue Ratio

The sum of revenue from questionable and non-compliant sources should not exceed 3% of the total revenue. This ensures that the company has tolerable reliance on unethical sources of revenue.

33.2%

Non Compliant

Questionable

Compliant

CALCULATION

\textbf{Revenue Ratio:} \\[12pt] \dfrac{974660000.00}{2796876000.00} \times 100 = 33.20\%

FORMULA

\textbf{Revenue Ratio:} \\[12pt] \dfrac{\text{Unethical Segments}}{\text{Total Revenue}} \times 100 \; \leq \; 3\%

Segment	Compliance	Value
Room Nights	compliant	₹137.79
Other Services	compliant	₹8.69
From Hotel Management and Consultancy Services	compliant	₹23.87
Other Income	compliant	₹11.87
Food, Beverages and Banquets	questionable	₹93.20
Interest Income	non-compliant	₹4.27

Debt Ratio

The interest bearing debt should not exceed 31% of the total assets. This is to ensure that the company is not paying a significant portion of its assets as interest.

42.5%

CALCULATION

\textbf{Debt Ratio:} \\[12pt] \dfrac{1996029000.00}{4699554000.00} \times 100 = 42.50\%

FORMULA

\textbf{Debt Ratio:} \\[12pt] \dfrac{\text{Interest Bearing Debt}}{\text{Total Assets}} \times 100 \; \leq \; 30\%

Liquidity Ratio

The total liquid assets should not exceed 90% of the total assets. This is to ensure that trading this stock does not become similar to trading a currency.

10.9%

CALCULATION

\textbf{Liquidity Ratio:} \\[12pt] \dfrac{510492000.00}{4699554000.00} \times 100 = 10.90\%

FORMULA

\textbf{Liquidity Ratio:} \\[12pt] \dfrac{\text{Total Liquid Assets}}{\text{Total Assets}} \times 100 \; \leq \; 90\%