Using the information provided below for Telstra Corporation Ltd (TLS) and TPG Telecom Limited (TPG):

1. Explain each category of ratio (profitability, asset efficiency, liquidity, capital structure and market performance) and what it tells you about the company. Conclude as to which company has the strongest results in each category.

b.Based on your findings justify which company you would seriously consider for an investment, subject to obtaining further information.

Profitability Ratios Item Net Profit Margin (%) ROE (%) ROA (%) TLS 06/19 21.68 37.63 14.28 TPG 06/19 16.83 14.47 8.55 0.74 Asset Efficiency Ratios Days Inventory Days Receivables Days Payables 6.47 45.53 11.82 47.06 65.43 Liquidity Ratios Current Ratio Quick Ratio 0.76 0.72 0.24 0.23 Capital Structure Ratios Gross Gearing (D/E) (%) Net Interest Cover 118.74 11.15 60.97 59.19 Market Performance PER 8.35 15.54