CHAPTER-1 INTRODUCTION AND DESIGN OF THE STUDY

INTRODUCTION OF FINANCE In the modern-oriented economy, finance is one of the basis foundations of all kinds of economic activities. It is the master key, which provides access to all the sources for being employed in manufacturing and merchandising activities. Finance is the lifeblood of an enterprise, every enterprise, irrespective of size, needs finance to carry on its operations and to achieve its targets. in our present day economy finance is the provisions of money at the time when it is required and without adequate finance, no enterprise can possibly accomplish its objectives. According to the American Institute of certified public accountants, financial statements reflect, A combination of recorded facts, accounting conventions and personal judgments and conventions applied them materially. FINANCIAL MANAGEMENT Financial management is an management which is related to deal management is concerned with the acquisition, financing and management of assets with some overall goal in mind.

Financial management influences the profitability or return on investment of a business. The choice of capital investment decisively affect the profitability of an undertaking. Financial management affects the solvency position of a business. Solvency refers to the ability to service debts paying interest and repaying principle as these become due. Profitability and nature of debts both concerns of financial management-govern the solvency aspect. THE BASIC OBJECTIVES OF FINANCIAL MANAGEMENT ARE 1. Ensuring a fair return to shareholders. 2. building up reserves for growth and expansion 3. Ensuring maximum operational efficiency by efficient and effective utilization of finance. 4. Ensuring financial discipline in the organization. FINANCIAL STATEMENT The financial statement provides a summary of the accounts of business enterprises. The balance sheet shows the result of operation during ascertain period. TYPES OF FINANCIAL STATEMENTS 1. A balance sheet 2. An income statement

BALANCE SHEET A tabular statement of summary of balances carried forward after an actual and constructive closing of books of account and kept according to principles of accounting. A balance sheet is a snapshot of a business

financial condition at a specific moment in time, usually at the close of an accounting period. A balance sheet comprises assets, liabilities, and owners or stockholders equity. Assets and liabilities are divided into short- and longterm obligations including cash accounts such as checking, money market, or government securities. At any given time, assets must equal liabilities plus owners equity. An asset is anything the business owns that has monetary value. Liabilities are the claims of creditors against the assets of the business. INCOME STATEMENT Income statement also referred as profit and loss statement (P&L), earnings statement, operating statement or statement of operations is a companys financial statement that indicates how the revenue is transformed into the net income. It displays the revenues recognized for a specific period, and the cost and expenses charged against these revenues, including write-offs (e.g., depreciation and amortization of various assets) and taxes. The purpose of the income statement is to show managers and investors whether the company made or lost money during the period being reported.

STATEMENT OF CHANGES IN OWNERS EQUITY/RETAINED EARNINGS The term Owners equity refers to the claims of the owners of the business (shareholders) against the assets of the firm. It consists of two elements; (i) paid-up share capital, i.e. the initial amount of funds invested by the shareholders; and (ii) retained earnings/reserves and surplus representing undistributed profits. The statement of changes in owners equity simply shows the beginning balance of each owners equity account, the reason for increases and decreases in each, and its ending balance. STATEMENT OF CHANGES IN FINANCIAL POSITION The basic financial statements, i.e.; the balance sheet and the profit and loss account or income statement of a business reveal the net effect of the various transactions on the operational and financial position of the company. The balance sheet gives a static view of the resources of a business and the uses to which these resources have been put at a certain point of time. The profit and loss do not operate through profit and loss account. Thus, for a better understanding another statement called statement of changes in financial position has to be prepared to show the changes in assets and liabilities from the end of one period to the end anther point of time. the objective of this statement is to show the movement of funds during a

particular period. The statement of changes in financial position may take any of the following two forms. i) Funds Flow Statement ii) Cash Flow Statement FINANCIAL ANALYSIS Financial analysis (also referred to as financial statement analysis or accounting analysis) refers to an assessment of the viability, stability and profitability of a business Sub- business or project. It is performed by professionals who prepare reports that make use of information taken from financial statement and other reports are usually presented to top management as one of their bases in making business decisions. Based on these reports, management may: Continue or discontinue its main operation or part of its business. Make or purchase certain materials in the manufacture of its product Acquire or rent / lease certain machineries and equipment in the production of its goods ; Issue stocks or negotiate for a bank loan to increase its working capital; Make decisions regarding investing or lending capital;

Other decisions that allow management to make an informed selection on various alternatives in the conduct of its business.

NEED FOR THE STUDY A firms success and its survival the market depend upon the effective financial management. It guides and regulates all the management activities of a firm. Management of finance is an important task in any organization. It requires both short-term-term planning. Financial anlaysis is the process of identifying the financial strength an weakness of the firm. It is the only one way to measure the firms liquidity, solvency and profitability. Financial management is a crucial factor in every enterprise emproper financial management leads to an under-utilization of the available resources and making the finance skill limited. Hence here the present study aims to create awareness among the management of the finance limited regarding the importance of financial management. STATEMENT OF THE PROBLEM The cement industry currently enjoys a good time with remunerative prices driven by a buoyant demand in the short term. Cement industry

represents an important segment of the Indian economy. The India cements Ltd incurred losses in 2002. one possible reason for such down cycle might

be poor financial health. Since the cement producing companies face threats to their viability, this study bears a relevance to the present day problems.

REVIEW OF LITERATURE Vasanthamani (1982)1 studied the financial performance of the cement limited. The objective of the study was to evaluate the financial performance of India cement limited with a view to analyze the future performance potential. The study covered the period from 1969 to 1989 the researcher found that the gross profit ratio and the net profit ratio were increasing considerably. The liquidity position of the company was able to meet the creditors out oh its current asset. The quick ratio also revealed that the quick reliabilities were met out quick asset. Without any difficulty. The leverage of the company revealed that its own capital was more then its borrowed capital. Karthikeyan(1989)2 has studied as financial performance of selected companies. His study has tried to identify the relationship between the financial forecasting models 300 companies were selected and the data relating to the financial performance variables were analyzed. The nine financial analysis. variables were net sales , total assets ,gross profit ,profit before taxed dividends, retained earnings, cash flow and net worth. G.Ravindaran (1990)3, has studied the financial performance of India cements limited. His objective was to study the financial position of the company for the period of 5 years from 1986 to 90. He concluded that the financial position of the company was not continuously steady. The rate of return had a declining trend till 1988-89. He found that the company in spite

of earning huge gross profit the net profits was comparatively very low, because of high operating costs. He also stressed the need for maintaining a desirable collection and payment period. Mr.S.Vijayakumar Bharathi (1992)4, in his study on the financial performance of PRICOL can electronic industry has been analyzed, the company's financial position bring the 'Z' score test of Edward Ahman of USA. According to this test the fmancial position of the company was found to be sound and that these in hardly any change of getting into bankruptcy in the near future. The financial analysis also depicts that through the sales has increased steadily over the study period, but because of high increase in operating costs, the net profit .had started declining, over the and of the study period. Measures were also suggested for improvements. The company's shorter liquidity position was found to be satisfactory. The investment in fixed assets has increased phenomenally by nearly 7 times. Mr.Siddharth G.Das (1994)5 attempted to ascertain efficient or otherwise use of working capital in selected pharmaceutical firms in India. In his study on Working Capital Turnover in Pharmaceutical Companies Having studied the data of ten years, he concluded that the overall working capital turnover ratio was 9.03 times. However, the study also revealed that working capital turnover ratio declined gradually over the period under review.

Debasish Sur (1997)6 attempted to assess the efficiency of working capital management in terms of working capital ratio, quick ratio, ratio of current asset to total assets, ratio of current assets to sales and composition of working capital. The study revealed that the working capital management was inefficient during the study period. The study recommended for special attention to the management of inventories, which constituted the highest part of current assets. Dr.M.Selvam, Mrs.S.Vanitha, and Mr.M.Babu (2002)7, they studied about A study on Financial Health of Cement Industry-with special reference to India Cements Limited.from 1998 to 2002. The objectives of this study are to examine the overall financial performance of India Cements Limited and to predict the financial health and viability of the India Cements Limited. They were studied to predict financial health of India Cements Limited using 'Z' Score Analysis and Multiple Discriminant Analysis. This study would also be useful to all companies, policy makers and researchers for appraising financial health of corporate sector in general and cement companies in particular. Sri.Iswatia and Muslich Anshoria (2005) 8 they studied about the influence of intellectual capital to financial performance at Insurance Companies in Jakarta Stock Exchange. The purpose of this empirical study is to investigate the influence of intellectual on insurance companys performance especially financial performance. This study uses empricial data

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from Indonesia Capital Market Directory 2005 that is issued from Jakarta Stock Exchange. This research use quantitative analysis. The main conclusion from this particular study is intellectual capital has influence on Banks performance. Mr.M.Kannadhasan (2005)9 in the study of risk evaluation of financial performance in manufacturing industry from 2000 to 2010. The aim of this study was company from a study a bankers perspective. They were used analyzed with the help of ratio analysis and also through the application of statistical tools such as mean, and standard deviation. They concluded has made the realistic recommendation for the improvement in operational and managerial efficiency of the company as to maintain and increase further by effective utilization and control of the assets. S.Vanitha and M.Selvam (2007)10 studied financial performance of Indian manufacturing companies during pre and post merger. The study is about before totally 58 companies were identified at random with help of lottery method and accordingly 30% from the total population was taken as size i.e 17 companies out of 58. the conclusion emerging from the point of view of evaluation is that the merging companies were taken over by companies with reputed and good management. Therefore, it possible for the merged firms to turn around tested with a sample size before coming to a conclusion.

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OBJECTIVES OF THE STUDY The following are the main objectives of the present study. 1. To study the need and importance of financial statement analysis in the organization. 2. ltd 3. ltd. 4. To offer suitable suggestions on the basis of findings. To predict the financial health and viability of the India cements To examine the overall financial performance of India cements

SCOPE OF THE STUDY The Scope of the present study confines to the financial performance of India Cements Ltd. The study on financial performance focuses on

liquidity, solvency, profitability, shareholders wealth and Edward Altmans Zscore (health) analysis of the study unit.

METHODOLOGY The work carried out in this study are based on the information collected from accounts ledgers, financial records and other documents in the annual reports of the company were exclusively used for this study. Further analysis was carried out through the interpretation of the above documents,

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discussion with the accounts officer and the company secretary of the company. The other sources include experts and executives opinion. SAMPLE DESIGN At the present study intends to analyses the financial performance of India cements limited on the production of cement. The reseach design starts with the selection of India cements limited, as a core unit. Period of the present study covers a period of 10 years starting from . DATA ANALYSIS In order evaluate the financial performance of India cements limited the data are analyzed through various tools and techniques for a period of 10 years from 2000-01 to 2009-10. Tools and techniques of Financial Analysis Financial statement analysis is defined as the process of identifying financial strengths and weaknesses of the by properly establishing relationship between the items of the balance sheet and the profit and loss account. There are methods or techniques that are used in analyzing financial statements ,such as i) ii) Ratio analysis. Edward Altmans z-score(health) analysis.

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STATISTICAL TOOLS USED The data collected from various sources and were analyzed by mean, standard deviation analysis, and co- efficient of variation. MEAN Arithmetic mean is commonly called as average. Mean or Average. is defined as the sum of the given elements divided by the total number of elements. FORMULA X=

x n

STANDARD DEVIATION Standard deviation of a statistical data is defined as the positive square of the arithmetic mean of the squared deviation of their arithmetic mean of the series under consideration. The Standard deviation is denoted by s(sigma). The Standard deviation is also know as Root mean square deviation because it is the square root of the arithmetic mean of the squares of the deviation. Square of the standard deviation is called variance. FORMULA Sd =

X2 X n n

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CO-EFFICIENT OF VARIABLE The Co-efficient of variable is reported as a percentage and calculated from the average and Standard deviation as follows: Co-efficient of variation (C.V) =

SD x100 M

LIMITATIONS OF THE STUDY The financial data required for the present study has been obtained from secondary data. The study is limited for the of last 10 years only. The study does not cover areas of financial management such as, capital budgeting, dividend policiesetc., All the data collected for analysis is obtained from published annual reports of the company so, is a chance for error in sufficiency which may affect the analysis.

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CHAPTER SCHEME The present study of the researcher entitled A study on financial statements analysis, the India Cements Limited, Sankari West, Salem, has been organized into six chapters. Chapters I: Deals with introduction mainly concerned with the design of the study viz., methodology used related literature and limitations of the study Chapters II: Deals with profile of the company. Chapters III: Deals with present the data related to the evaluation of the performance of the sample unit through ratio analysis. Chapters IV: Deals with the health analysis using z-score. Chapters V: Deals with the system analysis. Chapters VI: Deals with finding, suggestions, and conclusion.

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REFERENCES 1. Vasanthamani.K "A study of the financial performance of India Cements Limited", M.Com, Dissertation PSGCAS-1982 2. Karthikeyan, "Financial performance of selected companies" - An Analytical Study", M.Com., Dissertation PSGCAS - 1989. 3. Mr.G.Ravindaran "An analysis of the financial performance of LG.Balakrishnan & Brothers limited, M.Com dissertation-1990. 4. Mr.S.Vijayakumar Bharathi. "An analysis of the financial performance of PRICOL, "M.Com. Dissertation-1992. 5. Siddharth M.R. Das G. (1994), Working Capital Turnover in Pharmaceutical Companies, The Management Accountant, March 1994, pp.151-153. 6. Debasish Sur (1997), Working Capital Management in Colgate Palmolive (India) Ltd. A Case Study, The Management Accountant, November 1997, pp.828-833. 7. Dr.M.Selvam, Mrs.S.Vanitha, and Mr.M.Babu, "A study on Financial Health of Cement Industry-"Z" Score Analysis in India Cements Limited", Bharathidasan University, Tiruchirappalli-620 024. 8. Sri. Iswatia and Muslich Anshoria, "The Influence of Intellectual Capital to Financial Performance at Insurance Companies in Jakarta Stock Exchange", Faculty of Economics Airlangga University. 9. Mr.M.Kannadhasan, MBA, MFT, M.Phil, (Ph.D)," Risk evaluation of Financial Performance in Manufacturing Industry" Trichy-14 10. S.Vanitha and M.Selvam," financial performance of Indian Manufacturing companies during pre and post merger", Ph.D. Research Scholar, Tiruchirappalli- 620 024.

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CHAPTER II COMPANY PROFILE

The India Cements Limited was established in 1946 and the first plant was setup at Sankaragar in Tamilnadu in 1949.since then it has grown in stature to seven plants spread over Tamilnadu and Andhra Pradesh. The capacities as on march 2002 have increased multifold to a million tons per annum. India being the second the largest cement producer in the world after china with a total capacity of 151.2 Million tons (m.t) has not a huge cement industry. The history of the cement industry in India dates back to the 1889.when a Kolkata based company started manufecturing cement from argillaceous. But the industry Started getting the organized shape in the early 1900s. In 1914, India cement company ltd was established in porbandar with a capacity of 10000 tons and production of 1000 installed. The world war gave the first initial thrust to the cement industry in India and the industry started growing at a fast rate in terms of production, manufecturing units and installed capacity. This stage was referred to as the nascent stage of Indian cement industry.

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In 1927 concrete Association of India was set up to create public awareness on the utility of cement as well as topropagate cement consumption. The cement industry in India saw the price and distribution control system in the year 1956 established to ensure fair price model for consumers as well as manufectures later in 1977, government authorized new manufacturing units (as well as existing units going for capacity enhancement) to put a higher price tag fir their products a couple of years later government introduced a three-tier system with different pricing on cement produced high medium and low cost plants cement industry in any country , plays a major role in the growth of the nation cement industry in India was under full control and supervision of the government. However it got relief at a large extent after the economic reform. But government interference especially in the pricing is still evident in India. In spite of being the second largest cement producer in the world India falls in the list of lowest per capital consumption of cement with 125kg. the reason behind this is the poor rural people who mostly live in mud huts cannot afford to have the commodity. Despite the fact the demand and supply of cement in India has grown up. In a fast developing economy like india there is always large possibility of expansion of cement industry

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COMPANY HIGHLIGHT The company is the largest producer of cement in south India. The companys plants are well spread with three in Tamilnadu and four in Andhra Pradesh which later to all major markets in south India and Maharashtra. The company is the market share of 28% in the south. It aims to achieve a 35% market share in the near future. The company has access to huge limestone Top 10 cement companies in India India worlds second largest cement producer after china is the home to a number of top cement companies. As various infrastructure projects road networks and housing projects are coming up money of which are backed by the government the cement industry by in India is growing at a great pace these days. With the capacity of 151.2 million.tones (mt) the Indian cement industry is truly big in size and hence accommodates a number of cement

companies in the market. Not only that move growth is further expected in the coming years. which will also lead to the growth of top cement companies in India. Let s have a look at the top 10 cement companies in India. FOLLOWING ARE THE LIST OF TOP 10 CEMENT COMPANIES IN INDIA. Acc limited Gujarat ambuja cements limited Ultratech
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 Grasim India cements Jk cement ltd Jaypee group Century cement Madras cement Birla corp. ECONOMIC OVERVIEW The performance of the Indian economy in 2007-08 continued to be good with GDP growth at 9% despite rise in crude oil prices and financial turbulence. The reasons are the flow of substantial capital investment the fairly satisfactory performance of the industrial sector which recorded a grow the of 8.5% and the development of the services sector which grow at 10.8% during the year the manufacturing and services sector together accounts for 25% of the nators economy. Further the adverse impact of the rising which touched USD 155.5 billion in 2007-08 recording a healthy growth of 23% over the previous fiscal. Imports grew by 27% year or gear to USD 235.9 billion during 2007-08 the trade deficit widening to USD 80.4 billion. On the agricultural front the total food grain production in 2007-08 however has been commendable and ps estimated at 227.32 million tomes this is 10 million tones move than the production achieved in 2006-07 representing an increase
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of 4.6% the union budget 2008-09 has addressed most of these concerns through pts focus or infrastructure, agriculture, healthcare, education and rural development, Agriculture, rural development social account for over 37% of the total central plan getlay for 2008-09 the government and the reserve bank of India are also seized off the problem of inflation and have come out with fiscal and monetary measure to corb pts rising graph. INDUSTRY SCENARIO Indian is the 2nd largest cement producer in word china the cement industry in India has been enjoying pts best period with a healthy growth in demand in the past two years. the industry has been operating at its nearful capacity during this period .the cement prices have been steady throughout the year with this firm demand position. A review of regional pattern of growth in cement demand reveals the following 2007-08 North East South West Central overall 12.17% 5.65% 9.71% 14.00% 6.05% 9.80% 2006-07 10.44% 5.87% 12.90% 9.10% 8.90% 9.90%

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CEMENT PRODUCTION AND GROWTH Domestic demand plays a major role in the fast growth of cement industry in India. In the domestic demand of cement has passed the economic growth role of India the cement consumption is expected to rise move than 22% by 2009-10 form 2007-08. In cement consumption the state of Maharashtra leads the table with 12.18% consumption followed by Uttar Pradesh terms of current production Andhra Pradesh leads the list with 14.72% of production white Rajasthan remains second position. The production of cement in India grew at a rate of 9.1% during 20006-07 against the total production of 147.8 MT in the previous fiscal year. During April to October 2008-09, the production of cement in India was 101.04 MT comparing to 95.05 during the same period in the previous year. . During October 2009,the total cement production in India was 12.37 MT compared to a production of 11.61 MT in the same month in the previous year. The cements companies are also increasing their productions due to the high market demand . the cement companies have seen a net profit growth

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rate of 85%.with this huge success the cement industry in India has contributed almost 8% to India s economic development. Technology up- Gradation Cement industry in India is currently going through a technological change as a lot of up gradation and assimilation is taking place. Currently, almost 93% of the total capacity is based entirely on the modern dry process, which is considered as more environment friendly. Only the rest 7% uses old wet and semi-dry process technology. There is also a huge scope of waste heat recovery in the cement plants, which lead to reduction in the emission level and hence improves the environment. Merger and acquisition in cement industry in India Ultra tech cement is going to absorb its sister concern Samruddhi cement to become biggest cement company in India. Worlds leading foreign funds like HSBC, ABN Amro, Fidelity, Emerging market fund and asset management fund have together bought 7.5% of India cements (ICL) AT A COST OF US$ 124.91 million. Cimpor , a cement company of Portugal, has bought 53.63% stake that Grasim Ingustrirs had in Shree Digvijay cement French cement company Vicat SA bought 6.6% share of Sagar cement at a cost of US$ 14.35 million.
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 Holcim

now holds 56% stake of Ambuja cement, previously it

held 22% of stake. The company utilized various open market transaction to increase its stakes. It invested US$ 1.8 billion for that.

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Recent investment in the Indian Cement Industry In a recent announcement the second largest cement company in south India, Dalmia cement declared that its going to invest more then US$ 652.6 million in the next 2-3 years to add MT capacity Anil Ambani led reliance infrastructure is going to build up cement plants with a total capacity of yearly 20 MT in the next 5 year. For this the company will invest US$ 2.1 billion. India cements is going to set up 2 thermal power plants in Andhra Pradesh and Tamilnadu at a cost of US$ 104 billion. Anil Ambani-led reliance cementation is also going set up a MT Integrated cement in Maharashtra. It will invest US$ 463.2 million for that. Jaiprakash association ltd has signed a Mou with Assam mineral development corporation limited to set up a 2 MT cement plant. The estimated project cost is US$ 221.36 million. Rungta mines (RML) is also planning to invest US$ 123 million for setting up a 1 MT cement plant in orissa.

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INDIA CEMENTS India cements is one of the well known cement companies in India. It has a big market base in the infrastructure as well as the real estate segment. The high quality products and services at affordable cost make it one of the most preferred cement companies in the country. More and more industry segments are opting for the products of India cement. PROFILE OF INDIA CEMENTS LTD Shri Sankaralinaga lyer was a pioneer of heavy industry in the south. Primarily a banker, he ventured into the field of industry with a rare devotion and confidence with the prime objective of developing major industries I the state with his banking experience and interest in exploring the mineral potential of south India, he went ahead boldly with his scheme of building a cement plant in the vicinity of Thaliyuthu, where extensive deposits of limestone were assuredly available. Shri Sankaralinga Iyer with his energy and drive gave the cement project a realistic form and content. FOUNDERS OF THE INDIA CEMENTS LTD Two men with vision to inspire dreams for an industrial India. Two men with the ability to translate those dreams into reality. And the ability to build enduring relationships. To build the future. In his task of establishing the enterprise, Shre Iyer was ably assisted by Shri T.S.Narayanaswami, who is always identified with the formation and

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running of The India cements limited. Shri T.S. Narayanaswami was the catalyst who saw the project through numerous hurdles and made it emerge as a viable and marketable proposition. He looked beyond cement to Aluminium production, Chemicals and Plastics and Shipping after he adfully established the India Cements potential for expansion. A pioneer industrialist and visionary, Shri T.S.Narayanaswami played a dynamic role in the resurgence of industrialissation in free India. SOME OF THE MAJOR MILESTONES OF INDIA CEMENTS India The company has three cement plants in tamil nadu and four in the state of Andhra Pradesh According to recent surveys, the company has a market share of arount 28% in the states of South India. It has aiming to increase the market share to arount 35% over the next few years. The main business objective of the company is to make use of the vast limestone resource and expand the production by proper management and optimization of the existing plants. There are around 10,000 stockist who distribute products and services of the company It is the largest producer of cement in the southern part of

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The company has its regional offices in all the staes of South India and also in Maharastra.

The plants of India cements are located in different regions of the states of Tamil Nadu and Andhra Pradesh. The following table will give an idea of their location

Plant location Sankar Nagar Dalavoi Dalavoi Sankari Yeramguntla Chilamkur Vishnupuram PRODUCTS AND SERVICES

State Tamil Nadu Tamil Nadu Tamil Nadu Tamil Nadu Andhra Pradesh Andhra Pradesh Andhra Pradesh

The products offered by India cement cater to the various market and industrial segments in the country. They are designed in such a way so as to keep pace with the changing market trends and consumer tastes and preferences. Some of the well known brands that are produced by the India cements ltd are: Sankar Sakthi, Raasi gold and Coromandel king: These brands of cement have that high strength in them to meet the requirements of the infrastructure and development sector. The high capacity of the

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cement helps them to withstand high pressure and be water resistant even in case of the rainy season. The cost of the brand is also affordable which make them very much preferred by the consumers all over the country. Blended cement: the company also produces some of the pure

brands of blended cement to fulfill the needs and preferences of the market. The blended cement is produced by various technological methods with a combination of mineral mixtures and gypsum. The produce goes through a stringent testing process in the high scale laboratories. Sulphate resisting protland cement: India cement is also a known

name in the manufacture of sulphate resisting Portland cement. It is mainly known as slag cement and is very much required in case of normal constriction process. 1946 1949 1963 1969 1969 1971 1990 Incorporation of The India Cements Limited. Commissioning of first cement plant at Sankarnagar-Installed capacity 1 lac tones per annum. Commissioning of second cement plant at Sankaridrug-Instaled capacity 2 lac tones per annum. Capacity expansion at Sankarnagar touches 9 lac tones per annum. Awarded Merit Certification for Outstanding Export Performance (1968-1969) Capacity expansion at sankari durg to 6.00 lakh tones per annum. Acquisition of coromandel cement plant at cuddapah-installed capacity rises to 2.6 million tones per annum. The India cements

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1990 1991 1994 1994 1995 1996

ltd. Becomes the largest producer of cement in south India. Conversion of sankarnagar plant to dry process with the increased capacity of 1.00 million tones per annum. India cements ventures into shipping. Sets up a shipping division. ISO 9002 certification for sankarnagar plant Floats successfully US$ 50 million GDR issue. Announces issue of 1:1 bonus shares. India cements green field cement plant at Dalavoi commences commercial production. Installed capacity 0.9 million tones per annum India cements acquires aruna sugars finance ltd. Renamed as India cements capital & finance ltd. India cements acquires cement plant of visaka cement industry ltd., at Tandur, Ranga Reddy district of Andhra Pradesh. Installed capacity 0.9 Million Tonnes India cements acquires cement corporation of indias yerraguntla cement plant at Andhra Pradesh. Installed capacity 0.4 million Tonnes. India cements acquires Raasi cement ltd., at Nalgonda District of Andhra Pradesh. Installed capacity 1.8 million tones India cements acquires cement plant of Shri Vishnu Cement Ltd., at Nalgonda District of Andhra Pradesh. Installed capacity 1.0 Million Tonnes Turnover sails over the Rs.1000 crore mark. India cements divests its stake in Sri Vishnu Cement Limited. Groups overall capacity reaches 9 million tones The unique waste heat recovery system for generation of power from waste gas at vishnupuram cement plant was commissioned during novermber 2004, for a capacity of 7.7 MW of power. The company through its special purpose vechicle M/s coromandel electric co ltd has commissioned a (gas based) captive power plant at Ramanathapuram for a capacity of 17.4 MW and the same has started supplying power from the month of November 2004. The company has successfully completed an equity issue in the

1997 1997

1998

1998 1999

1999 2001 2001 2004

2004

2005

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international market during October 2005 by issuing 25,613,796 Global Depositary shares (GDSs) at USD 4.326 per GDS, (each GDS representing 2 underlying equity share of Rs 10 each) and raised an amount of Rs 497 Crores including a premium of Rs 446 2006 crores. The company has issued unsecured Zero Coupon Convertible Bonds due 2011 (FCCBs) 2006 The company has issued unsecured zero coupon convertible bonds due 2011(FCCBs) for US $75 million to investors outside India at 2007 an initial conversion price of Rs.305.57 per share. The Honble high court of judicature at madras vide its order dated 25th July 2007 sanctioned the scheme of amalgamation of Visaka 2007 2007 cement industry limited with the cements lid. The company has converted the Sankari plant from wet process to dry process and commissioned the plant. The company has privately placed 2,07,89,000 equity shares at a price of Rs.285/- per share(including premium of Rs.275/- per share) by way of qualified institutional placement in December 2008 2008 2008 2009 2007. The company has revived its shipping business with the purchase of two ships(dry bulk carriers)with a total capacity of 79843 DWT. The company has successfully bid for the Chennai franchise of the DLF-IPL20/20 cricket tournament - Chennai super kings. The company has completed and commenced commercial production of the million tonne grinding plant at Chennai. The company has completed and commenced commercial production of the million tonne grinding plant at parli 2009 (maharashtra). The companys subsidiary, namely, Trishul concrete products limited has completed and commenced commercial production of the one lakh cu.m ready mix concrete plant at Hyderabad(Andhra

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2009 2009 2010

Pradesh) the line of 1.2 MT at malkapur was commenced operations from march 2009 The upgraded capacity of kiln 1 to 3000 TPD(1700 TPD) at Vishnupuram started functioning from April 2009 The corporate office of the company was shifted in February, 2010 to its own building Coromandel Towers at 93, Santhome High Road, Karpagam Avenue, MRC NAgar, Chennai 600 028.

MANAGEMENT The India cements ltd is a professionally managed company headed by Mr.N.Srinivasan , vice chairman and managing director. The day-today affairs of the company are managed by him assisted by key personnel in functional area. The board of directors are ultimately responsible for the management of the affairs of the company.

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Shri.N. Shinivasan Shri. B.S.Adityan Shri..R.K.Das Shri Shinivasan Shri. A.Sankarakrishna n Ms.Rupa Gurunath Shri. N.R.Krishnan Shri. Manickam Shri. K.P.Nair Shri. K.Subramanian

Vice Chairman & Managing Director Director Director Director Director

Director Director Representing life insurance corporation of india Nominee of IDBI Bank ltd Representing housing & urban development corporation ltd Auditors: Messrs, Brahmayya & co., Messrs. P.S. .Subramania lyer & CO., Chartered accountants, Chennai.

NAME OF THE ASSOCIATE / SUBSIDIARY COMPANIES Industrial chemicals & Monomers Ltd ICL Securities Ltd ICL Financial Services Ltd ICL International Ltd Trishul Concrete Products Ltd PT. Coromandel minerals Resources, Jakarta Indonesia Coromandel Electric Company Ltd Unique receivable Management Private Ltd Coromandel Sugars Company Ltd India Cements Capital Ltd Rasi cements Ltd Coromandel Travels Ltd Sudsidiary Company Sudsidiary Company Sudsidiary Company Sudsidiary Company Sudsidiary Company Sudsidiary Company Associate Company Associate Company Associate Company Associate Company Associate Company Associate Company

34

COMPANY HIGHLIGHT The company is the largest producer of cement in south India. The companys plants are well spread with three in Tamilnadu and four in Andhra Pradesh which cater to all major markets in south India and Maharashtra. The company is the market leader with a market share of 28% in the South. It aims to achieve 35% market share in the future. The company has access to huge limestone resources and plans to expand capacity by de-bottlenecking and optimization of existing plants as by acquisitions. The company has a strong distribution network with over 10000 stockists whom 25% are dedicated. The company has well established brandssankar super power, coromandel super power and Rasi Super Power. Regional offices in all southern states and maharasthra offices / representative in every district. Technical cell to all queries / doubts tech.cell @ indiacements .co.in

CHAPTER III DATA ANALYSIS AND INTERPRETATION

3.1 RATIO ANALYSIS

35

Ratio analysis is one of the techniques of financial analysis where ratios are used as a yardstick for evaluating the financial condition and performance of a firm. Ratios are relationship expressed in mathematical terms between figures which are connected with each other in some manner. Ratios can be expressed in two ways. TIMES When one value is divided by another, the unit used to express the quotient is termed as Times. For example if out of 100 students in a class, 80 are present, the attendance ratio can be expressed as follows: = 80 / 100 = 0.8 Times. PERCENTAGE If the quotient obtained is multiplied by 100, the unit of expression is termed as Percentage. For instance, in the above example, the attendance ratio as a percentage of the total number of students is as follows: = 0.8 x 100 = 80%.

36

CLASSIFICATION OF RATIOS LIQUIDITY RATIOS Liquidity refers to the ability of a concern to meet its current obligations as and when these become due. The short-term obligations are met by realizing amounts from current, floating or circulating assets. The current assets should either be liquid or near liquidity. i) ii) iii) Current Ratio Liquid or Acid Test or Quick Ratio Absolute Liquid Ratio

SOLVENCY RATIO Long-term solvency ratios convey a firms ability to meet the interest costs and repayments schedules of its long-term obligations. i) ii) iii) iv) v) Debt-Equity Ratio Fixed Asset to Proprietors Fund Ratio Current Asset to Proprietors Fund Ratio Proprietary Ratio Reserves to Capital Ratio

ACTIVITY RATIO The activity ratios are also known as turnover or efficiency ratios. They indicate the efficiency with which the capital employed is rotated in the business.

37

i) ii) iii) iv)

Stock / Inventory Turnover Ratio Working Capital Turnover Ratio Capital Turnover Ratio Fixed Assets Turnover Ratio

PROFITABILITY RATIO Profitability is an indication of the efficiency with which the operations of the business are carried on. Bankers, financial institutions and other creditors look at the profitability ratios as an indicator whether or not the firm earns substantially more than it pays interest for the use or borrowed funds and whether the ultimate repayment of their debt appears reasonably certain. The following are the important profitability ratios. i) ii) iii) iv) v) Net Profit Gross Profit Operating Profit Return on Investment Return on Capital Employed

38

I. LIQUIDITY RATIO CURRENT RATIO The ratio of current assets to current liabilities is called current ratio. In order to measure the short-term liquidity or solvency of a concern, comparison of current assets and current liabilities is inevitable. Current ratio indicates the ability of a concern to meet its current obligations as and when they are due for payment. An increase in the current ratio represents improvement in the liquidity position of a firm while a decrease in the current ratio indicates that there has been deterioration in the liquidity position of the firm. A ratio equal or near to the rule of thumb of 2:1 i.e., current assets double the current liabilities is considered to be satisfactory.

FORMULA Current Assets Current Ratio = -----------------------------Current Liabilities

39

TABLE 3.1 CURRENT RATIO (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 Mean S.D. C.V Source: Annual report of India Cements Limited INTERPRETATION The table 3.1 show that it can be observed that the average current ratio is 3.33 is high when compared to the rule of thumb of 2 : 1. The standard deviation is 1.22 and the co-efficient variation is 36.49. The higher current ratio for the 10 years is 5.38 in 2003-04 and lower current ratio is 1.85 in 2008-09. In all the years, the current ratio was good except in the year 2008-09. CURRENT ASSET 1406.15 1413.41 1315.82 1308.17 1368.45 1512.42 1717.52 2149.42 2143.54 2876.45 CURRENT LIABILITY 359.43 312.02 452.07 242.83 321.18 387.05 983.53 983.53 1153.32 1274.10 RATIO 3.91 4.52 2.91 5.38 4.26 3.90 2.18 2.18 1.85 2.25 3.33 1.22 36.49

40

CHART NO. 3.1

CURRENT RATIO
6 5 4

5.38 4.52 3.91 2.91 2.18 2.18 2.25 1.85

4.26 3.9

RATIO

3 2 1 0

2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10

YEARS

41

LIQUID RATIO Quick ratio also known as acid test or liquid ratio is a more rigorous test of liquidity than the current ratio. Quick ratio may be defined as the relationship between quick / liquid assets and current or liquid liabilities. An assets is said to be liquid it can be converted into cash with in a short period without loss of value. In that sense cash in hand and cash at bank are most liquid assets. The other assets which can be included in the liquid assets are bills receivable, sundry debtors, marketable securities and short term or temporary investment. Usually, a high acid test ratio is an indication that the firm is liquid and has ability to meet its current or liquid liabilities in time and on the other hand a low quick ratio represents that the liquidity position is not good. As a rule of thumb or as convention quick ratio of 1:1 is considered satisfactory. FORMULA Quick / Liquid Assets Liquid Ratio = ----------------------------------Current Liabilities

42

TABLE 3.2 LIQUID OR QUICK RATIO (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 Mean S.D. C.V Source : Annual report of India Cements Limited INTERPRETATION The table 3.2 shows that it can be observed that the average current ratio is 3.014 is high when compared to the rule of thumb of 1:1 the standard deviation is 0.97 and the co-efficient of variation is 32.18. The higher liquid asset is the 4.73 in 2003-04 the 10 years. The lower liquid asset of is 1.51 2008-2009. The liquid ratio of the study units is good because in all the years, the liquid ratio was above the rule of thumb of 1:1. QUICK ASSETS 1209.60 1219.10 1162.40 1149.10 1166.80 1298.60 1469.02 1798.80 1752.60 2408.20 CURRENT LIABILITIES 359.43 312.02 452.07 242.83 321.18 387.05 433.99 983.53 1153.32 1274.10 RATIO 3.36 3.90 2.57 4.73 3.63 3.35 3.38 1.82 1.51 1.89 3.014 0.97 32.18

43

CHART NO 3.2
QUICK RATIO
5 4.5 4 3.5

4.73 3.9 3.36 2.57 1.82 1.51 1.89

3.63

3.35

3.38

RATIO

3 2.5 2 1.5 1 0.5 0 2000-01 2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

YEARS

44

ABSOLUTE LIQUID RATIO The absolute liquid ratio is calculated along with current ratio and liquid ratio. The absolute liquid ratio is calculated by the formula,

FORMULA Cash & Bank ------------------------Current Liabilities

Absolute Liquid ratio

The acceptance norm for this ratio is 50% or 0.5 : 1 i.e. Rs. 1 of absolute liquid assets are considered adequate to pay Rs.2 worth of current liabilities in the time as all the creditors are not expected to demand cash at the same time. Absolute liquid assets include cash in hand and at bank and all other marketable securities or temporary investments.

45

TABLE NO. 3.3 ABSOLUTE LIQUIDITY RATIO (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 Mean S.D. C.V Source : Annual report of India Cements Limited INTERPRETATION From the table 3.3 it shows that the absolute liquidity ratio of India cements limited is it can be observed the average absolute liquidity ratio It is 0.127. The standard duration is 0.191 and the co-efficient of variation is 150.986. The higher of the 10 year 0.530 in 2006-07 and the lower absolute liquidity ratio is the 0.009 in 2004-05. CASH & BANK 9.63 2.85 6.05 3.72 2.92 43.62 230.18 425.64 85.20 53.81 CURRENT LIABILITY 359.43 312.02 452.07 242.83 321.18 381.05 433.99 983.53 1153.32 1274.10 RATIO 0.027 0.009 0.013 0.015 0.009 0.114 0.530 0.433 0.074 0.042 0.127 0.191 150.986

46

CHART NO. 3.3

ABSOLUTE LIQUIDITY RATIO
0.600 0.500 0.400

0.530 0.433

RATIO

0.300 0.200

0.114
0.100

0.074 0.027 0.009

2001-02

0.013

0.015

0.009
2004-05

0.042

0.000 2000-01 2002-03 2003-04 2005-06 2006-07 2007-08 2008-09 2009-10

YEARS

47

II. SOLVENCY RATIO DEBT EQUITY RATIO This ratio is ascertained to determined long-term solvency position of a company debt equity ratio is also called External-Internal Equity Ratio. The ratio indicates the proportionate claims of owners and the outsiders against the firms assets. Therefore, interpretation of this ratio depends primarily upon the financial policy of the firm and upon the firms nature of business. A ratio of 1:1 may be usually considered to be a satisfactory ratio although there cannot be any rule of thumb or standard norm for all type of business. Generally, a low ratio is considered as favourable from the long-term creditors point of view because a high proportion of owners funds provide a larger margin of safety for them at the time of liquidations of the firm. But caution should be taken, as a very high ratio may be unfavourable from the point of view of the firm also because the firm may not be able to get credit without paying very high rates of interest and without accepting undue pressures and conditions of the creditors.

FORMULA

Debt Debt-Equity Ratio = ---------------------------------Shareholders Fund

48

TABLE 3.4 DEBT EQUITY RATIO (Rs. in Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 DEBT 1880.70 1793.10 1778.43 2047.31 1987.24 1552.24 2058.75 1811.51 1988.03 2132.73 SHAREHOLDERS FUND 806.36 620.11 418.74 1360.75 1275.30 1743.01 2208.53 3321.11 3631.39 4135.82 Mean S.D. C.V Source : Annual report of India Cements Limited INTERPRETATION The table 3.4 shows that the debt equity ratio of India cements Limited is it can be observed the average debt equity it is 1.59. The standard deviation is 1.16 and the co-efficient of variation is 72.86. The higher ratio of 4.24 was registered in the year 2002-03. The lowest ratio of 0.51 was registered in the year 2009-10. The ratio was expressing decreasing trend in latter part of the study period. RATIO 2.33 2.89 4.24 1.50 1.55 0.89 0.93 0.54 0.54 0.51 1.59 1.16 72.86

49

CHART NO. 3.4

DEBT EQUITY RATIO
4.5 4 3.5

4.24

RATIO (%)

3 2.5 2 1.5 1 0.5 0 2000-01

2.89 2.33 1.5 1.55 0.89 0.93 0.54 0.54 0.51

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

YEARS

50

PROPRIETARY RATIO Proprietary ratio is also known as equity ratio. It establishes the relationship between the proprietors or shareholders fund and the total tangible assets of the firm. It is an important ratio for determining the longterm solvency of the firm. The formula for calculating proprietary ratio is

FORMULA Shareholders Funds ----------------------------Total Assets

Proprietary Ratio

51

TABLE NO. 3.5 PROPRIETARY RATIO (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 SHAREHOLDER FUND 806.36 620.11 418.74 1360.75 1275.30 1743.01 2208.53 3321.11 3631.39 4135.82 TOTAL ASSET 3116.40 3149.90 3065.10 3256.80 3476.10 3692.90 4846.50 6263.10 6950.10 8293.00 Mean S.D. C.V Source : Annual report of India Cements Limited INTERPRETATION From the table 3.5, it shows that the solvency ratio is India Cements Limited is given below and it can be observed that the average ratio is 0.38. The standard deviation is 0.12 and the co-efficient of variation is 31.58 the higher solvency ratio for the 10 year is 0.53 in 2007-08 and the lower solvency ratio is 0.13 in 2002-03. And the ratio shows an increasing trend, that express solvency position of the firm is increasing. RATIO 0.25 0.19 0.13 0.41 0.36 0.47 0.45 0.53 0.52 0.49 0.38 0.12 31.58

52

CHART NO. 3.5

PROPRIETARY RATIO
0.6 0.5

0.53 0.47 0.41 0.36 0.25 0.19 0.13 0.45

0.52

0.49

0.4

RATIO

0.3 0.2 0.1 0

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

YEARS

53

RATIO OF CURRENT ASSET TO PROPRIETORS FUND The ratio is calculated by dividing the total of current assets of the amount of shareholders funds. It indicates the extent to which the proprietors funds are invested in current assets.

FORMULA Current assets to shareholders = Funds ratio Current Assets -----------------------------------Shareholders Fund

54

TABLE NO. 3.6 RATIO OF CURRENT ASSET TO PROPRIETORS FUND (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 CURRENT ASSET 1406.15 1413.41 1315.82 1308.17 1368.45 1512.42 1717.52 2149.42 2143.54 2876.45 SHAREHOLDERS 806.36 620.11 418.74 1360.75 1275.30 1743.01 2208.53 3321.11 3631.39 4135.82 Mean S.D. C.V Source : Annual report of India Cements Limited INTERPRETATION The table 3.6 express that the current asset to proprietors fund ratio of India Cements Ltd can be observed the average ratio is 1.273. The standard deviation is 0.800 and the co-efficient of variation is 62.84. The higher for the 10 year is 3.14 in 2002-03. The lower ratio of 0.59 in 2008-09. The ratio shows a decreasing trend, so the proposition of current assets was reduced to minimum. RATIO 1.74 2.27 3.14 0.96 1.07 0.86 0.77 0.64 0.59 0.69 1.273 0.800 62.84

55

CHART NO. 3.6

RATIO OF CURRENT ASSET TO PROPRIETORS FUND

3.5 3 2.5

3.14

2.27 1.74 1.07

RATIO

2 1.5 1 0.5 0

0.96

0.86

0.77

0.64

0.59

0.69

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

YEARS

56

RATIO OF RESERVES TO EQUITY CAPITAL The ratio establishes the relationship between reserves and equity share capital. It indicates how much profits are generally retained by the firm for future growth. Higher the ratios better the position of the firm.

FORMULA Reserve ----------------Equity Capital

Ratio of Reserves to Equity Capital =

57

TABLE NO. 3.7 RATIO OF RESERVES TO EQUITY CAPITAL (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 RESERVES 642.88 456.52 255.15 1197.16 1111.71 1527.24 1948.16 3039.24 3348.96 3828.65 SHARE CAPITAL 163.48 163.59 163.59 163.59 163.59 215.77 260.37 281.87 282.43 307.17 Mean S.D. C.V Source : Annual report of India Cements Limited INTERPRETATION The above table 3.7 shows, the reserves to equity capital ratio of India Cements Ltd is it can be observed the average ratio is 7.202. The standard deviation is 3.52 and the co-efficient of variation is 48.87. The higher for the 10 year is 12.46 in 2009-10. The lower ratio of 1.56 in 2002-03. The increasing trend of this ratio express the solvency and financial stability is increased. RATIO 3.93 2.79 1.56 7.31 6.79 7.07 7.48 10.78 11.85 12.46 7.202 3.52 48.87

58

CHART NO. 3.7

RATIO OF RESERVES TO EQUITY CAPITAL

14 12 10

11.85 10.78

12.46

RATIO

8 6 4 2 0 2000-01 2001-02 2002-03

7.31

6.79

7.07

7.48

3.93 2.79 1.56

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

YEARS

59

III. ACTIVITY RATIO STOCK TURNOVER RATIO This ratio is also called stock velocity ratio. It is calculated to ascertain the efficiency of inventory management in terms of capital investment. It shows the relationship between the cost of goods sold and the amount of average inventory. Stock turnover ratio is obtained by dividing the cost of sales by average stock.. The ratio is helpful in evaluating and review of inventory policy. It indicates the number of times the inventory is turned over during a particular accounting period. Inventory turnover ratio measures the velocity of conversion of stock into sales Usually, high inventory turnover/stock velocity indicates efficient management of inventory because more frequently the stocks are sold, the lesser amount of money is required to finance the inventory. A low inventory turnover ratio indicates an inefficient management of inventory. It may also be mentioned there that there are no rule of thumb. The norms may be different for different firms depending upon the nature of industry and business conditions. FORMULA Stock turnover ratio = Net Sales Average inventory

60

TABLE 3.8 STOCK TURNOVER RATIO (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 Mean S.D. C.V Source : Annual report of India Cements Limited INTERPRETATION The table 3.8 shows that the stock turnover ratio of india cements limited is worked out and is known in above Table 3.5. From the above table, it can be observed that the average stock turnover ratio is 1.65. The standard deviation is 0.28 and the co-efficient of variation is 16.99. The higher stock turnover ratio of the ten year is 2.06 in 2006-07 and the low stock turnover ratio is 1.33 in 2002-03. During the study period of stock turnover ratio shows horizontal trend. COST OF GOODS SOLD 295.93 260.29 205.96 247.50 285.04 402.98 513.38 638.02 680.13 873.24 AVERAGE INVENTORY 196.48 194.24 153.41 159.07 201.60 213.82 248.50 350.64 390.93 468.19 RATIO 1.50 1.34 1.33 1.55 1.41 1.88 2.06 1.81 1.73 1.86 1.65 0.28 16.99

61

CHART NO. 3.8

STOCK TURNOVER RATIO
2.5

2.06
2

1.88 1.5 1.34 1.34 1.55 1.41

1.81

1.73

1.86

RATIO (%)

1.5

0.5

0 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10

YEARS

62

CAPITAL TURNOVER RATIO A companys annual sales divided by its average shareholders equity. Capital turnover is used to calculate the rate of return on common equity and is a measure of how well a company uses its stockholders equity to generate revenue. The higher the ratio is, the more effectively a company is using its capital. It is called equity turnover.

FORMULA Capital Turnover Ratio = Net Sales Net Worth

63

TABLE 3.9 CAPITAL TURNOVER RATIO (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 Mean S.D. C.V Source : Annual report of India Cements Limited INTERPRETATION The working capital turnover ratio of india cements limited is worked out and is known in above Table 3.9. From the above table, it can be observed that the average working capital turnover ratio is 0.124. The standard deviation is 0.014 and the co-efficient of variation is 11.29. The higher working capital turnover ratio of the ten year is 0.16 in 2005-06 and the low stock turnover ratio is 0.09 in 2002-03. During the study period of ten years stock turnover ratio shows fluctuating trend. NET SALES 295.93 260.29 205.96 247.50 285.04 402.98 513.38 638.02 680.13 873.24 CAPITAL EMPLOYED 2615.06 2413.21 2197.17 2432.16 2350.25 2411.23 3485.30 4408.33 4953.49 5660.99 RATIO (%) 0.11 0.10 0.09 0.10 0.12 0.16 0.14 0.14 0.13 0.15 0.124 0.014 11.29

64

CHART NO. 3.9

WORKING CAPITAL TURNOVER RATIO
0.18 0.16 0.14

0.16 0.14 0.11 0.12 0.1 0.09 0.1 0.14 0.13

0.15

RATIO (%)

0.12 0.1 0.08 0.06 0.04 0.02 0

2000-01

2001-02

2002-03

2003-04

2004-05 2005-06

2006-07

2007-08

2008-09

2009-10

YEARS

65

FIXED ASSETS TURNOVER RATIO This ratio indicates the extent to which the investment in fixed assets contributes towards sales. An increase in this ratio is the indication of efficiency in work performance and a decrease in this ratio speaks of unwise and improper investment in fixed assets.

FORMULA Net Sales ---------------------Net Fixed Assets

Fixed Assets Turnover Ratio =

66

TABLE NO. 3.10 FIXED ASSETS TURNOVER RATIO (Rs. In Crores) RATIO (%) 0.75 0.60 0.50 0.53 0.56 0.72 0.73 0.76 0.72 0.72 0.66 0.101 15.377

YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10

NET SALES 1256.95 1019.11 851.58 1016.9 1162.14 1541.75 2255.21 3044.25 3359.49 3687.26

FIXED ASSET 1673.4 1701.9 1714.6 1913.9 2072.99 2145.73 3074.06 3984.4 4647.65 5102.65 Mean S.D.

C.V Source : Annual report of India Cements Limited INTERPRETATION

The fixed asset turnover ratio of India cements limited is worked out and is known in above Table 3.10. From the above table, it can be observed that the average fixed assets turnover ratio is 0.66. The standard deviation is 0.101 and the co-efficient of variation is 15.377. The higher working capital turnover ratio of the ten year is 0.76 in 2007-08 and the low stock turnover ratio is 0.50 in 2002-03. During the study period of stock turnover ratio shows fluctuating trend. It shows poor control over inventory.
67

CHART NO. 3.10

FIXED ASSETS TURNOVER RATIO
0.90 0.80 0.70 0.60

0.75 0.60 0.50 0.53

0.72 0.56

0.73

0.76

0.72

0.72

RATIO

0.50 0.40 0.30 0.20 0.10 0.00 2000-01 2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

YEARS

68

WORKING CAPITAL TURNOVER RATIO This ratio is calculated by dividing the net sales by capital employed. It measures the efficiency with which a firm utilizes its resources. As capital is invested in a business to make sales and earn profits, this ratio is a good indicator of overall profitability of a concern.

FORMULA

Net Sales Working Capital Turnover Ratio = -----------------------------Net Working Capital

69

TABLE NO. 3.11 WORKING CAPITAL TURNOVER RATIO (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 SALES 295.93 260.29 205.96 247.50 285.04 402.98 513.38 638.02 680.13 873.24 NETWORKING CAPITAL 1046.70 924.23 800.65 1019.10 1000.97 1076.74 1240.51 940.18 734.61 1333.07 Mean S.D. C.V Source: Annual report of India Cements Limited INTERPRETATION The table 3.11 shows that the working capital turnover ratio of India cements limited is it can be observed that the average working capital turnover ratio 0.426. The standard deviation is 0.213 and the co-efficient of variation is 52.88. The higher working capital turnover ratio for the 10 year 0.92 in 2008-09 and the lower ratio is 0.24 in 2003-04. The ratio shows increasing trend for the period of study. RATIO 0.28 0.28 0.25 0.24 0.28 0.37 0.41 0.68 0.92 0.55 0.426 0.213 52.88

70

CHART NO. 3.11

WORKING CAPITAL TURNOVER RATIO

1 0.9 0.8 0.7

0.92

0.68 0.55 0.37 0.28 0.28 0.25 0.24 0.28 0.41

RATIO

0.6 0.5 0.4 0.3 0.2 0.1 0 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09

2009-10

YEARS

71

IV. PROFITABILITY RATIO GROSS PROFIT RATIO This ratio is also known as gross margin or trading margin ratio. Gross profit ratio indicates the difference between sales and direct costs. Gross profit ratio explains the relationship between gross profit and net sales. The gross profit indicates the extent to which selling prices of goods per unit may decline without resulting in losses on operations of a firm. Higher the gross ratio better the result. A low gross ratio, generally indicates high cost of goods sold due to unfavourable purchasing policies, lesser sales, lower selling prices, excessive competition, over investment in plant and machinery, etc.,

FORMULA Gross profit ratio = Gross Profit x 100 Net Sales

72

TABLE 3.12 GROSS PROFIT RATIO (Rs. in Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 GROSS PROFIT 134.15 79.91 225.84 31.22 83.35 128.84 594.59 972.56 851.62 764.44 NET SALES 1256.95 1019.11 851.58 1016.90 1162.14 1541.75 2255.21 3044.25 3359.49 3687.26 Mean S.D. C.V Source : Annual report of India Cements Limited RATIO (%) 10.67 7.84 26.52 3.07 7.17 8.35 26.36 31.94 25.34 20.73 16.79 9.87 58.75

The table 3.12 shows that the gross profit ratio of india cements limited is worked out and is known in above Table 3.13. From the above table, it can be observed that the average gross profit ratio is 16.79. The standard deviation is 9.87 and the co-efficient of variation is 58.75. The higher working capital turnover ratio of the ten year is 31.94 in 2007-08 and the low stock turnover ratio is 3.07 in 2003-04. During the study period of gross profit ratio shows fluctuating trend.

73

CHART NO. 3.12

GROSS PROFIT RATIO
35 30 25

31.94 26.52 26.36 25.34 20.73

RATIO (RS. IN CRORES)

20 15

10.67
10 5 0 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10

7.84 3.07

7.17

8.35

YEARS

74

NET PROFIT RATIO This ratio is also called net profit to sales ratio. It is measures of managements efficiency in operating the business successfully from the owners point of view. It indicates the return on shareholders investments. Higher the ratio better is the operational efficiency of the business concern.

FORMULA Net Profit Ratio = Net Profit x 100 Net Sales

75

TABLE NO. 3.13 NET PROFIT RATIO (Rs. in Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 Mean S.D. C.V Source : Annual report of India Cements Limited INTERPRETATION The table 3.13 expressed that the net profit ratio is the India Cements Limited is it can be observed the average ratio is 10.17 and the standard derivation is 10.78. The co-efficient of variation is 106.06. The higher net profit is 10 year 23.64 in 2002-03. The lower ratio is -11.40 for the 2003-04. It shows a fluctuating trend. NET PROFIT 48.10 119.75 201.32 -116 63.13 36.27 472.70 665.01 486.02 325.95 NET SALES 1256.95 1019.11 851.58 1016.90 1162.14 1541.75 2255.24 3044.25 3359.49 3687.26 RATIO (%) 3.80 11.75 23.64 -11.40 5.43 2.35 20.96 21.84 14.46 8.83 10.17 10.78 106.06

76

CHART NO. 3.13

NET PROFIT RATIO
30 25

23.64 20.96

21.84 14.46

RATIO (RS. IN CRORES)

20 15 10 5 0 -5 -10 -15 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10

11.75 8.83 3.8 5.43 2.35

-11.4

YEARS

77

RETURN ON INVESTMENT This ratio is called return on investment (ROI) or return on capital employed. It measures the sufficiency or otherwise of profit in relation to capital employed. Return on investment is used to measure the operational and managerial efficiency. A comparison of ROI with that of similar fims, with that of industry and with that of industry and with past ratio will be helpful in determining how efficiently the long-term funds of owners and creditors being put into use. Higher the ratio, the more efficient is the use of the capital employed.

FORMULA Operating Profit x 100 Capital Employed

Return on Investment =

78

TABLE NO. 3.14 RETURN ON INVESTMENT (Rs in Crores ) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 OPERATING PROFIT 324.35 285.35 32.70 130.46 216.85 277.77 744.39 1082.42 963.77 907.08 CAPITAL EMPLOYED 2615.10 2413.20 2197.17 2432.20 2350.25 2411.23 3485.30 4408.33 4953.49 5660.99 Mean S.D. C.V Source : Annual Report of India Cements Limited INTERPRETATION The table 3.14 revealed that the return on investment is India Cement Limited is it can be observed the average ratio is the 13.32 the standard deviation is 7.16. The co-efficient of variation is 53.79. The higher for the 10 year is 24.55 in 2007-08 and the lower return on investment ratio is the 1.49 in 2002-03. The ratio shows a fluctuating trend. RATIO (%) 12.40 11.82 1.49 5.36 9.23 11.52 21.36 24.55 19.46 16.02 13.32 7.16 53.79

79

CHART NO. 3.14

RETURN ON INVESTMENT
30 25

RATIO (RS. IN CRORES)

24.55 21.36 19.46 16.02

20 15 10

12.4

11.82 9.23 5.36

11.52

1.49
0 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10

YEARS

80

RETURN ON CAPITAL EMPLOYED Return on capital employed establishes the relationship between profits and the capital employed. It is the primary ratio and is most widely used to measure the overall profitability and efficiency of a business. The term capital employed refers to the total of investments made in a business and can be defined in a number of ways.

FORMULA Net capital employed = Adjusted Net Profits x 100 Net capital employed

81

TABLE NO. 3.15 RETURN ON CAPITAL EMPLOYED (Rs. in Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 ADJUSTED NET PROFITS 48.10 119.75 201.32 -116 63.13 36.27 472.70 665.01 486.02 325.95 NET CAPITAL EMPLOYED 2615.06 2413.21 2197.17 2432.16 2350.25 2411.23 3485.30 4408.33 4053.49 5660.99 Mean S.D. C.V Source : Annual report of India Cements Limited INTERPRETATION The table 3.15 cleared that the return on capital employed of India cements limited is it can be observed that the average return on capital it employed is 5.95 the standard deviation is 6.04 and the co-efficient of variation is 101.53. The higher return on capital employed for the 10 years is 15.08 in 2007-08 and the lower return on capital employed is -4.76 in 200304. The ratio exhibits a fluctuating trend. RATIO (%) 1.84 4.96 9.16 -4.76 2.68 1.50 13.50 15.08 9.81 5.75 5.95 6.04 101.53

82

CHART NO. 3.15

RETURN ON CAPITAL EMPLOYED
20

RATIO (RS. IN CRORES)

15

13.5 9.16 4.96 1.84 2.68 1.5

2005-06 2006-07

15.08 9.81 5.75

10

0 2000-01 -5 2001-02 2002-03 2003-04 2004-05 2007-08 2008-09 2009-10

-4.76

-10

YEARS

83

OPERATING PROFIT RATIO Operating Profit is arrived by dedicating operating expenses from gross profit. This ratio helps in determining the efficiency with which the affairs of the business are managed. FORMULA

Operating Profit Operating Profit Ratio = ----------------------------- x 100 Net Sales

84

TABLE NO. 3.16 OPERATING PROFIT RATIO (Rs. in Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 OPERATING PROFIT 324.35 285.35 32.70 130.46 216.85 277.77 744.39 1082.42 963.77 907.08 NET SALES 1256.95 1019.11 851.58 1016.90 1162.14 1541.75 2255.21 3044.25 3359.49 3687.26 Mean S.D. C.V Source : Annual report of India Cements Limited INTERPRETATION The table 3.16 shows that the operating profit ratio of India Cement Limited is it can be observed that the average operating profit ratio is 45.90. The standard deviation is 75.12 and the co-efficient of variation is 163.67. The higher operating profit ratio for the year 85.56 in 2007-08. The Low operating profit ratio is 3.84 in 2002-03. The ratio is in increasing trend. RATIO (%) 25.80 257.99 3.84 12.83 18.66 18.02 33.00 35.56 28.69 24.60 45.90 75.12 163.67

85

CHART NO. 3.16

OPERATING PROFIT RATIO

1 0.9 0.8 0.7

0.92

0.68 0.55 0.37 0.28 0.28 0.25 0.24 0.28 0.41

RATIO

0.6 0.5 0.4 0.3 0.2 0.1 0 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09

2009-10

YEARS

86

3.2 Z SCORE ANALYSIS FINANCIAL DISTRESS Financial distress is a condition when a company cannot meet, or has difficulty to pay off, is financial obligations to its creditors. The chance of financial distress increases when a firm has high fixed costs, liquid assets, ore revenues that are sensitive to economics downturns. Financial distress is a term in corporate finance used to indicate a condition when promises to creditors of a company are broken or honored with difficulty. Sometimes financial distress can lead to bankruptcy. Financial distress is usually associated with some costs to the company and these are known as costs of financial distrees. Financial distress is a situation where a firms operating cash flows are not sufficient to satisfy current obligations and the firm is forced to take corrective actions, and a firm in financial distress may also face bankruptcy or liquidation to meet its liabilities. Financial distress can be caused by losses, dividend reduction or bankruptcy. A good way to measure the possibility of bankruptcy is to use Z score model (Altman, 1968).

87

INDICATORS OF FINANCIAL DISTRESS The ratios used for prediction the financial distress include liquidity ratios, solvency ratios and activity ratios. Liquidity Ratios Liquidity ratios measure the firms ability to meet its obligations I the short run. Solvency ratios Solvency ratios measure the firms ability to meet the debt long run. Activity ratios Activity ratios measure the firms ability to utilize its assets in an efficiency manner. Z- SCORE ANALYSIS Z score analysis has been established by Edward I Altman (1968) to evaluate the general trend in the financial health of an enterprise over a period. Many of the individual accounting ratios used frequently to predict the financial performance of an enterprise may only provide warnings when it is too late to take a corrective action. The data collected were first analysed with the help of five accounting ratios. These different ratios are combined into a single measure Z score analysis with the help of MDA. The model uses common financial

88

information such as Sales revenue and total assets to derive five basic financial ratios. Components of Z-Score model Working capital to total assets X1 Retained earnings to Total Assets X2 EBIT to Total Assets X3 Market value of Equity of Book value of liabilities X4 Sales to total assets X5 Z-Score (Arrived at using the weightage factors ) For the purpose of predicting the financial health and capability of India cements limited. The Z score method has been applied. The data has been obtained from the companys financial statements. The Z- Score of the company has been computed for the last five years (2004-05 to 2008-09). Formula Z = 0.012X1 + 0.014X2 + 0.033X3 + 0.006X4 + 0.999X5 Z is the overall index and the variables X1 and X4 are computed as absolute percentage values while X5 is compared in number of times. MEASUREMENT OF FINANCIAL HEALTH

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Altman established the following guidelines to be used classify firms as wither financially sound or bankrupt. ALTMAN GUIDELINE FOR HEALTHY ZONE

Situation I II III

Z Score Below 1.8 1.8 to 3.0 3.0 and above

Zones Bankruptcy Zone healthy Zone Too Healthy Zone To fall uncertain to predict fall

I.

Below Z score of 1.8, the unit is considered to be in bankruptcy zone. Its failure is certain and extremely likely and would occur probably within a period of two years.

II.

If a unit has a Z score between 1.8, and 3, its financial viability is considered to be healthy. The failure in this situation is uncertain to predict.

III.

Above Z score of 3, the unit is in too healthy zone. Its financial health is very viable and not to fall.

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WORKING CAPITAL RATIO The working capital to total assets ratio is a measure of the liquid assets of the firm relative to the total capitalization. Working capital is defined as the difference between current assets and current liabilities. Ordinarily a firm experiencing consistent operating losses will have shrinking current assets in relation to total assets.

FORMULA Working Capital to Total Assets = Working Capital x 100 Total Assets

91

TABLE NO. 3.17 WORKING CAPITAL TO TOTAL ASSETS (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 WORKING CAPITAL 1046.70 924.23 800.65 1019.10 1000.97 1076.74 1240.51 940.18 734.61 1333.07 TOTAL ASSETS 2615.06 2413.21 2197.17 3408.06 3262.54 3268.25 4267.28 5132.62 5619.42 6268.55 RATIO 40.02 38.29 34.49 29.90 30.68 32.94 29.07 18.31 13.07 21.26 28.998

Mean Source : Annual report of India Cements Limited

INTERPRETATION Table 3.17 shows the select ratios (Variables) of India Cements Ltd during the period from 2001-2010. The content of working capital in the total assets of India Cements Ltd was decreased from 40.02 in 2000-01 to 13.07 in 2008-09. it showed the excessive use of working capital over the years. This is unfavourable for the efficient running of the India Cements Ltd and it affects financial health.

92

CHART NO. 3.17

WORKING CAPITAL TO TOTAL ASSETS
45 40

40.02

38.29 34.49 29.9 30.68 32.94 29.07 21.26 18.31 13.07

RATIO (RS. IN CRORES)

35 30 25 20 15 10 5 0 2000-01 2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

YEARS

93

RETAINED EARNINGS TO TOTAL ASSET The ratio of Retained Earnings to Total Assets indicates the efficiency of the management in earnings, and total assets.

FORMULA Retained Earning Retained Earnings to Total Asset = x 100 Total Assets

94

TABLE NO. 3.18 RETAINED EARNING TO TOTAL ASSETS (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 RETAINED EARNING 642.88 456.52 255.15 1197.16 1111.71 1527.24 1948.16 3039.24 3348.96 3828.65 TOTAL ASSETS 2615.06 2413.21 2197.17 3408.06 3262.54 3268.25 4267.28 5132.62 5619.42 6268.55 RATIO (%) 24.58 18.91 11.61 35.12 34.07 46.72 45.65 59.21 59.59 61.07 39.65

Mean Source : Annual report of India Cements Limited

INTERPRETATION Table 3.18 shows the select ratios (Variables) of India Cements Ltd during the period from 2001-2010. The content of retained earning in the total assets of India Cements Ltd was increased from 11.61 to 61.07. It showed the increasing trend of retained earnings over the years. The average of retained earnings to total assets is 39.65.

95

CHART NO. 3.18

RETAINED EARNINGS TO TOTAL ASSETS
70 60 50

59.21 46.72 35.12 24.58 18.91 11.61 34.07

59.59

61.07

45.65

RATIO

40 30 20 10 0 2000-01 2001-02 2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

YEARS

96

RATIO OF EARNING BEFORE INTEREST AND TAXES TO TOTAL ASSETS This ratio is a measure of the true productivity of the firms assets, independent of any tax or leverage factors. Since a firms ultimate existence is based on the earning power of its assets, this ratio appears to be particularly appropriate for studies dealing with corporate failure.

FORMULA EBIT Ratio of Earning before interest and taxes to total assets = x 100 Total Assets

97

TABLE NO. 3.19 EARNING BEFORE INTEREST AND TAXES TO TOTAL ASSETS (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 EBIT 324.35 285.35 32.7 130.46 216.85 277.77 744.39 1082.42 963.77 907.08 TOTAL ASSETS 2615.06 2413.21 2197.17 3408.06 3262.54 3268.25 4267.28 5132.62 5619.42 6268.55 RATIO (%) 12.40 11.80 1.48 3.82 6.64 8.49 17.4 21.08 17.1 14.4 11.46

Mean Source : Annual report of India Cements Limited

INTERPRETATION Table 3.19 shows the ratios (Variables) of India Cements Ltd during the period from 2001-2010. The content of EBIT to total assets of India Cements Ltd was fluctuated trend. The highest ratio was 21.08 in 2007-08 and the lowest ratio was1.48 in 2002-03. The average of EBIT to total assets is 11.46.

98

CHART NO. 3.19 EARNING BEFORE INTEREST AND TAXES TO TOTAL ASSETS
25

21.08
20

17.4 12.4

17.1 14.4

RATIO

15

11.8 8.49 6.64 3.82 1.48

10

0 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10

YEARS

99

RATIO OF MARKET VALUE OF EQUITY TO BOOK VALUE OF DEBT The ratio of market value of enquiry to book value of debt is a reciprocal of the familiar debt-equity ratio. Equity is measured by the combined market value of all shares, while debt includes both current and long term liabilities. This measure shows show much assets of an enterprise can decline in value before the liabilities exceed the assets and the concern becomes insolvent.

FORMULA Ratio of market Value of equity = to book value of debt Market value of Equity x 100 Book value of liabilities

100

TABLE NO. 3.20 MARKET VALUE OF EQUITY TO BOOK VALUE OF DEBT (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 MARKET VALUE 9.15 9.83 6.36 19.56 27.04 69.73 56.74 57.15 28.50 35.25 BOOK VALUE 56.42 42.94 28.41 25.97 34.39 45.13 62.92 92.13 105 114.86 RATIO (%) 16.21765 22.89241 22.38648 75.31767 78.62751 154.5092 90.178 62.03191 27.14286 30.68954 57.99932

Mean Source : Annual report of India Cements Limited

From the table 3.20, the thumb rule of debt-equity mix is 1:1. The analysis of this study cleared that India Cements Ltd did not maintain the above standard during the study period. The market value of equity was greater than that of debt during the study period. As a result the ratio of market value of total equity of book value of debenture was 5265.33 in 200708, which was increased from 180.72 in 2002-03. So the company would be considered as quite good. Thus the reasonable change in the financial structure ratio is essential to protect the company for adverse financial performance.

101

CHART NO. 3.20

MARKET VALUE OF EQUITY TO BOOK VALUE OF DEBT

180.00 160.00 140.00 120.00

154.51

RATIO

100.00 80.00 60.00 40.00 20.00 0.00

75.32

78.63

90.18 62.03 27.14 30.69

16.22

22.89

22.39

2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10

YEARS

102

RATIO OF SALES TO TOTAL ASSETS The capital-turnover ratio is a standard financial ratio illustrating the sales generating ability of the firms assets. It is one measure of managements capacity in dealing with competitive conditions. FORMULA Ratio of sales to total assets = Sales Total Assets

103

TABLE NO. 3.21 SALES TO TOTAL ASSETS (Rs. In Crores) YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 SALES 1256.95 1019.11 851.58 1016.90 1162.14 1541.75 2255.24 3044.25 3359.49 3687.26 TOTAL ASSETS 2615.06 2413.21 2197.17 3408.06 3262.54 3268.25 4267.28 5132.62 5619.42 6268.55 RATIO 0.480 0.422 0.38 0.29 0.35 0.47 0.52 0.59 0.60 0.58 0.467

Mean Source : Annual report of India Cements Limited

Table 3.21 shows the ratios of India Cements Ltd during the period from 2001-2010. The content of Sales to Total Assets of India Cements Ltd was fluctuated trend. The highest ratio was 0.60 in 2008-09 and the lowest ratio was 0.29 in 2003-04. The average of EBIT to total assets is 0.467. The sales volume during the study period clearly showed that the cement company had been successful in achieving the standard ratio through sales.

104

CHART NO. 3.21

SALES TO TOTAL ASSETS
0.7 0.6 0.5

0.59 0.48 0.422 0.38 0.29 0.35 0.52 0.47

0.6

0.58

RATIO

0.4 0.3 0.2 0.1 0 2000-01 2001-02

2002-03

2003-04

2004-05

2005-06

2006-07

2007-08

2008-09

2009-10

YEARS

105

Z SCORE WEIGHTAGE FACTORS Variables of Z-Score X1 Working capital to Total Assets X2 Retained Earnings to Total Assets X3 Earning Before Interest and Taxes to Total Assets X4 Market Value of Equity to Book Value to Debt X5 Sales to Total Assets Z Score

106

TABLE NO. 3.22 Z-SCORE (ARRIVED AT USING THE WEIGHTAGE FACTOR YEAR 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 X1 1.286 1.088 0.652 0.126 0.215 0.474 0.031 -1.203 -1.804 -0.865 X2 -0.852 -1.172 -1.584 -0.256 -0.315 0.399 0.339 1.105 1.126 1.210 X3 0.149 0.054 -1.580 -1.209 -0.763 -0.470 0.940 1.522 0.892 0.465 X4 -0.888 -0.939 -1.070 -0.893 -0.664 0.535 0.764 1.681 0.451 1.023 X5 0.121 -0.427 -0.825 -1.676 -1.108 0.026 0.499 1.161 1.161 1.067 Z-SCORE -0.184 -1.397 -4.406 -3.908 -2.636 0.965 2.573 4.267 1.828 2.900

Source: Records of India Cements Limited.

From the Table No. 3.22, it is clear that the India cement company beginning part of five years the company was under grey area that is less than 1.80 and in later period of the study it shows improvement. In the year 200708 the z-score of the study unit is above too healthy zone. In the three years 2006-07, 2007-08 and 2008-09 the z-score was in the healthy zone. So the z-score analysis clearly indicates that the companies financial healthiness is improving year after year.

107

CHART NO. 3.22 Z-SCORE (ARRIVED AT USING THE WEIGHTAGE FACTOR

5 4 3

Z-SCORE (IN LAKHS)

2 1 0 -1 -2 -3 -4 -5 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10

YEARS

108

CHAPTER IV SYSTEM ANALYSIS

VISUAL BASIC AN OVERVIEW Visual basic uses event driven programming. In each activities in the program are triggered by one event or another. The code of Visual Basic programming is a set independent piece if code that all activated by and so respond to only the events they have told recognize. When the application is running, visual basic monitor the windows and controls in each window for all the events that each control can recognize mouse movements, clicks, key strokes and so on. Visual basic also provides sophisticated error handling, source code management, open IDE extensibility, OLE consent etc. OBJECTIVES OF VISUAL BASIC Visual Basic is an ideal programming language for developing sophisticated professional applications for Microsoft windows. It makes use of Graphical User Interface for creative robust and powerful application. GRAPHICAL USER INTERFACE The graphical user interface uses illustrations for text that enable users to interactive with an application.

109

It is quite a transition form linear programming methods where the user is guided through a linear path of execution and is limited to a small set of operations. In graphical user interface environment the number of options open to the user is much greater allowing more freedom to the user and the developer. The graphical interface feature makes it easier to comprehend things quickly. Apart from being user friendly, visual basic has many special features that it an interacting tool to work with. EVENT DRIVEN PROGRAMMING Visual Basic programs are built around events. Events are various things that can happen in a program in event driven application, the program statements are executed only when a particular event calls a specific part of the code that is assigned to the event. METHOD A method is an action that can be performed on objects. It is actually a built-in procedure that can be invoked to impart some action on a particular object.

110

SPECIAL FEATURES OF VISUAL BASIC 1. ODBC(Open Database Connectivity) Microsoft introduced ODBC, database connectivity API that allows application to communicate with different database management system. ODBC is based on SQL Access groups Call Level Interface (CLI) Specification, which uses SQL to access database. ODBC supports access to both SQL and non-SQL data. 2. OLE(Object Linking and Embedding) Is a technology that allows a programmers windows based application to create an application that can display data from many different applications say MS- Word, MS-Excel etc., 3. ActiveX It is a set of components that can be created and utilized by several applications. 4. MDI FORM It allows us to open windows within a parent container window. It is used commonly for document-centric applications where the main objects we work on all the documents.

111

5. INTEGRATED DEVELOPMENT ENVIRONMENT (IDE) Visual basic contains many integrated tools to make the application development process simpler. This collection of tools makes it the integrated development environment. It is called integrated because we can access virtually all of the development tools that we need from one scare called an Interface. The IDE is also commonly referred to as the design environment, the program or just the IDE. COMPONENTS OF IDE MENU BAR It is a line of text that gives access to other features within the development environment. Some of the menus available are File Menu, Edit Menu, View Menu, Help, Project Menu, Debug Menu, Add-Ins Menu etc., TOOL BAR The Tool Bar gives easy access to Menu Bar commands that are used frequently. The items in the tool bar can be customized to suit our applications. PROJECT EXPLORER We can make a quick reference to the various forms, modules and classes used in the project through Project Explorer. All the objects that make up an application are packaged into a project.

112

PROPERTIES WINDOW It exposes the various characteristics of selected objects. The properties set at design time can be changed during run time. FORM LAYOUT WINDOW It shows how the current form looks like and how it is positioned on the screen at run time. FORM DESIGNER This is the workspace where we actually design the visual layout of the form and the controls that lie on it. TOOL BOX It contains the tools that are necessary to build an application interface. These tools or objects are referred to as controls. Most of them are an intrinsic part of visual basic and are called built-in or standard controls. Some of the controls are Text Box, Label Box, Combo Box, List Box, Timer, Picture, Option Button, Check Box, etc.,

113

1. Pointer: This is the only one in the tool box that does not drunk a control. It provides a way to move and resize forms and controls. It should be noted that it is only used a click tool and not as a control. 2. Text Box: A text box control, sometimes called an edit field or edit control, displays information entered at design time, entered by the user, or assigned to the control in code art van time. 3. Combo Box: A combo box control combines the features of a text box control and a list box control can enter information in the text box portion or select an item from the list box of the control. 4. Timer: A timer control can execute code at regular intervals by causing a times event to occur. The Timer control, invisible to the user, is useful for back ground processing. 5. Label Box: A label control is a graphical control and we can use to display text that a upper cant change directly.

114

6. List Box: The list box will display list of items from which the user can choose one item. The list can be scrolled if it has more items that can be displayed at one time. 7. Combo Box: It is used to draw a combination of list box and text boxes. Allows user to type in a selection or select from dropdown list. 8. Command Button: Creates a button that which the user own choose to carry out a command. The command button carries out a command or action when a user choose it. 9. Picture Box: It is used to display graphical images as a container that receives output from graphical methods or as a container for other controls. 10. Option Button Option groups with other options buttons display multiple choices. From which a user can selected any one.

115

11. Frame It is used to create a graphical or functional grouping for controls. To group controls, the frame is drawn inside the frame. Buttons, labels, text boxes, option boxes etc., can be grouped together inside the frames 12. Check box It is used to create a box that the user can easily use to indicate if something is true or false or to display multiple choices when the user can choose more than one. 13. File list box It used to display a list of files that the user can open, save or otherwise manipulate. 14. Directory list box: During run time the user can retrieve information from directories by selecting a particular directory. 15. Drive list box: It is used to display all the files and directories in a selected drive. 16. Shape It is used draw a variety of shapes like rectangle, rounded rectangle, oval, circle, etc., on the form during design time.

116

OBJECT BROWSER It allows us to browse through the various properties, events and methods that are made available to us. We can access it by selecting Object Browser from the View Menu or pressing F2. VISUAL BASIC EDITOR: CODE WINDOW This is the area where we write the code for the application. It is actually a turbo-charged Text Editor with many productivity tool built-in. By using Visual Basic IDE, we can see either a form or the code window at a time. REASONS FOR SELECTING VISUAL BASIC AS A FRONT END In ODBC, database connectivity API allows application to

communicate with different DBMS. OLE is technologies that allows a programmer window based application to create an application that can display data from many different application say MS-Word, MS-Excel, etc., ActiveX is a set of components that can be created and utilized by several applications. In particular, ActiveX users interact technology to assist in creating compact and reasonable is an Internet or corporate Internet. Visual Basic consists of at least one form and one or more objects in the form of controls. Each control has its own property. By using Visual Basic, we can get more accurate design screen. Designing concept is very easier in Visual Basic.

117

INPUT
FORM I

118

OUTPUT

119

INPUT FORM II

120

OUTPUT

121

INPUT

FORM III

122

OUTPUT

123

INPUT FORM IV

124

OUTPUT

125

INPUT FORM V

126

OUTPUT

127

INPUT FORM VI

128

OUTPUT

129

CODING
FORM I Private Sub CmdRatio_Click() Text21.Text = Val(Text1.Text) / Val(Text11.Text) Text22.Text = Val(Text2.Text) / Val(Text12.Text) Text23.Text = Val(Text3.Text) / Val(Text13.Text) Text24.Text = Val(Text4.Text) / Val(Text14.Text) Text25.Text = Val(Text5.Text) / Val(Text15.Text) Text26.Text = Val(Text6.Text) / Val(Text16.Text) Text27.Text = Val(Text7.Text) / Val(Text17.Text) Text28.Text = Val(Text8.Text) / Val(Text18.Text) Text29.Text = Val(Text9.Text) / Val(Text19.Text) Text30.Text = Val(Text10.Text) / Val(Text20.Text) End Sub Private Sub Cmd Mean_Click() Text31.Text = (Val(Text21.Text) + Val(Text22.Text) + Val(Text23.Text) + Val(Text24.Text) + Val(Text25.Text) + Val(Text26.Text) + Val(Text27.Text) + Val(Text28.Text) + Val(Text29.Text) + Val(Text30.Text)) / 10 End Sub Private Sub Cmd S.D_Click() a = Val(Text21.Text) * Val(Text21.Text) b = Val(Text22.Text) * Val(Text22.Text) c = Val(Text23.Text) * Val(Text23.Text) d = Val(Text24.Text) * Val(Text24.Text) e = Val(Text25.Text) * Val(Text25.Text) F = Val(Text26.Text) * Val(Text26.Text) g = Val(Text27.Text) * Val(Text27.Text) h = Val(Text28.Text) * Val(Text28.Text) i = Val(Text29.Text) * Val(Text29.Text) j = Val(Text30.Text) * Val(Text30.Text) k = (a + b + c + d + e + F + g + h + i + j) / 10 l = Val(Text31.Text) * Val(Text31.Text) m=k-l Text32.Text = Sqr(m) End Sub Private Sub Cmd C.V_Click() Text33.Text = Val(Text32.Text) / Val(Text31.Text) * 100 End Sub Private Sub Cmd Exit_Click() End End Sub 130

FORM II Private Sub CmdRatio_Click() Text21.Text = Val(Text1.Text) / Val(Text11.Text) Text22.Text = Val(Text2.Text) / Val(Text12.Text) Text23.Text = Val(Text3.Text) / Val(Text13.Text) Text24.Text = Val(Text4.Text) / Val(Text14.Text) Text25.Text = Val(Text5.Text) / Val(Text15.Text) Text26.Text = Val(Text6.Text) / Val(Text16.Text) Text27.Text = Val(Text7.Text) / Val(Text17.Text) Text28.Text = Val(Text8.Text) / Val(Text18.Text) Text29.Text = Val(Text9.Text) / Val(Text19.Text) Text30.Text = Val(Text10.Text) / Val(Text20.Text) End Sub Private Sub Cmd Mean_Click() Text31.Text = (Val(Text21.Text) + Val(Text22.Text) + Val(Text23.Text) + Val(Text24.Text) + Val(Text25.Text) + Val(Text26.Text) + Val(Text27.Text) + Val(Text28.Text) + Val(Text29.Text) + Val(Text30.Text)) / 10 End Sub Private Sub Cmd S.D_Click() a = Val(Text21.Text) * Val(Text21.Text) b = Val(Text22.Text) * Val(Text22.Text) c = Val(Text23.Text) * Val(Text23.Text) d = Val(Text24.Text) * Val(Text24.Text) e = Val(Text25.Text) * Val(Text25.Text) F = Val(Text26.Text) * Val(Text26.Text) g = Val(Text27.Text) * Val(Text27.Text) h = Val(Text28.Text) * Val(Text28.Text) i = Val(Text29.Text) * Val(Text29.Text) j = Val(Text30.Text) * Val(Text30.Text) k = (a + b + c + d + e + F + g + h + i + j) / 10 l = Val(Text31.Text) * Val(Text31.Text) m=k-l Text32.Text = Sqr(m) End Sub Private Sub Cmd C.V_Click() Text33.Text = Val(Text32.Text) / Val(Text31.Text) * 100 End Sub Private Sub Cmd Exit_Click() End End Sub

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FORM III Private Sub CmdRatio_Click() Text21.Text = Val(Text1.Text) / Val(Text11.Text) Text22.Text = Val(Text2.Text) / Val(Text12.Text) Text23.Text = Val(Text3.Text) / Val(Text13.Text) Text24.Text = Val(Text4.Text) / Val(Text14.Text) Text25.Text = Val(Text5.Text) / Val(Text15.Text) Text26.Text = Val(Text6.Text) / Val(Text16.Text) Text27.Text = Val(Text7.Text) / Val(Text17.Text) Text28.Text = Val(Text8.Text) / Val(Text18.Text) Text29.Text = Val(Text9.Text) / Val(Text19.Text) Text30.Text = Val(Text10.Text) / Val(Text20.Text) End Sub Private Sub Cmd Mean_Click() Text31.Text = (Val(Text21.Text) + Val(Text22.Text) + Val(Text23.Text) + Val(Text24.Text) + Val(Text25.Text) + Val(Text26.Text) + Val(Text27.Text) + Val(Text28.Text) + Val(Text29.Text) + Val(Text30.Text)) / 10 End Sub Private Sub Cmd S.D_Click() a = Val(Text21.Text) * Val(Text21.Text) b = Val(Text22.Text) * Val(Text22.Text) c = Val(Text23.Text) * Val(Text23.Text) d = Val(Text24.Text) * Val(Text24.Text) e = Val(Text25.Text) * Val(Text25.Text) F = Val(Text26.Text) * Val(Text26.Text) g = Val(Text27.Text) * Val(Text27.Text) h = Val(Text28.Text) * Val(Text28.Text) i = Val(Text29.Text) * Val(Text29.Text) j = Val(Text30.Text) * Val(Text30.Text) k = (a + b + c + d + e + F + g + h + i + j) / 10 l = Val(Text31.Text) * Val(Text31.Text) m=k-l Text32.Text = Sqr(m) End Sub Private Sub Cmd C.V_Click() Text33.Text = Val(Text32.Text) / Val(Text31.Text) * 100 End Sub Private Sub Cmd Exit_Click() End End Sub

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FORM IV Private Sub CmdRatio_Click() Text21.Text = Val(Text1.Text) / Val(Text11.Text) Text22.Text = Val(Text2.Text) / Val(Text12.Text) Text23.Text = Val(Text3.Text) / Val(Text13.Text) Text24.Text = Val(Text4.Text) / Val(Text14.Text) Text25.Text = Val(Text5.Text) / Val(Text15.Text) Text26.Text = Val(Text6.Text) / Val(Text16.Text) Text27.Text = Val(Text7.Text) / Val(Text17.Text) Text28.Text = Val(Text8.Text) / Val(Text18.Text) Text29.Text = Val(Text9.Text) / Val(Text19.Text) Text30.Text = Val(Text10.Text) / Val(Text20.Text) End Sub Private Sub Cmd Mean_Click() Text31.Text = (Val(Text21.Text) + Val(Text22.Text) + Val(Text23.Text) + Val(Text24.Text) + Val(Text25.Text) + Val(Text26.Text) + Val(Text27.Text) + Val(Text28.Text) + Val(Text29.Text) + Val(Text30.Text)) / 10 End Sub Private Sub Cmd S.D_Click() a = Val(Text21.Text) * Val(Text21.Text) b = Val(Text22.Text) * Val(Text22.Text) c = Val(Text23.Text) * Val(Text23.Text) d = Val(Text24.Text) * Val(Text24.Text) e = Val(Text25.Text) * Val(Text25.Text) F = Val(Text26.Text) * Val(Text26.Text) g = Val(Text27.Text) * Val(Text27.Text) h = Val(Text28.Text) * Val(Text28.Text) i = Val(Text29.Text) * Val(Text29.Text) j = Val(Text30.Text) * Val(Text30.Text) k = (a + b + c + d + e + F + g + h + i + j) / 10 l = Val(Text31.Text) * Val(Text31.Text) m=k-l Text32.Text = Sqr(m) End Sub Private Sub Cmd C.V_Click() Text33.Text = Val(Text32.Text) / Val(Text31.Text) * 100 End Sub Private Sub Cmd Exit_Click() End End Sub

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FORM V Private Sub CmdRatio_Click() Text21.Text = Val(Text1.Text) / Val(Text11.Text) Text22.Text = Val(Text2.Text) / Val(Text12.Text) Text23.Text = Val(Text3.Text) / Val(Text13.Text) Text24.Text = Val(Text4.Text) / Val(Text14.Text) Text25.Text = Val(Text5.Text) / Val(Text15.Text) Text26.Text = Val(Text6.Text) / Val(Text16.Text) Text27.Text = Val(Text7.Text) / Val(Text17.Text) Text28.Text = Val(Text8.Text) / Val(Text18.Text) Text29.Text = Val(Text9.Text) / Val(Text19.Text) Text30.Text = Val(Text10.Text) / Val(Text20.Text) End Sub Private Sub Cmd Mean_Click() Text31.Text = (Val(Text21.Text) + Val(Text22.Text) + Val(Text23.Text) + Val(Text24.Text) + Val(Text25.Text) + Val(Text26.Text) + Val(Text27.Text) + Val(Text28.Text) + Val(Text29.Text) + Val(Text30.Text)) / 10 End Sub Private Sub Cmd S.D_Click() a = Val(Text21.Text) * Val(Text21.Text) b = Val(Text22.Text) * Val(Text22.Text) c = Val(Text23.Text) * Val(Text23.Text) d = Val(Text24.Text) * Val(Text24.Text) e = Val(Text25.Text) * Val(Text25.Text) F = Val(Text26.Text) * Val(Text26.Text) g = Val(Text27.Text) * Val(Text27.Text) h = Val(Text28.Text) * Val(Text28.Text) i = Val(Text29.Text) * Val(Text29.Text) j = Val(Text30.Text) * Val(Text30.Text) k = (a + b + c + d + e + F + g + h + i + j) / 10 l = Val(Text31.Text) * Val(Text31.Text) m=k-l Text32.Text = Sqr(m) End Sub Private Sub Cmd C.V_Click() Text33.Text = Val(Text32.Text) / Val(Text31.Text) * 100 End Sub Private Sub Cmd Exit_Click() End End Sub

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FORM VI Private Sub Command1_Click() Text34.Text = (Val(Text1.Text) + Val(Text6.Text) + Val(Text11.Text) + Val(Text16.Text) + Val(Text21.Text) Text35.Text = (Val(Text2.Text) + Val(Text7.Text) + Val(Text12.Text) + Val(Text17.Text) + Val(Text22.Text) Text36.Text = (Val(Text3.Text) + Val(Text8.Text) + Val(Text13.Text) + Val(Text18.Text) + Val(Text23.Text) Text37Text = (Val(Text4.Text) + Val(Text9.Text) + Val(Text14.Text) + Val(Text19.Text) + Val(Text24.Text) Text38Text = (Val(Text5.Text) + Val(Text10.Text) + Val(Text15.Text) + Val(Text20.Text) + Val(Text25.Text) End Sub Private Sub Command2_ Click() End End Sub

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CHAPTER V FINDINGS, SUGGESTIONS AND CONCLUSION

FINDINGS LIQUIDITY RATIO The current ratio was within the standard norm during the study period 2000-01 to 2009-10 The quick ratio also stands within the standard norm during the study period 2000-01 to 2009-10, so the liquidity was satisfactory. The absolute liquid ratio do touch the standard norm during the study period 2000-01 to 2009-10 SOLVENCY RATIO Debt equity ratio shows satisfactory level Proprietary ratio shows satisfactory level. Current asset to proprietary fund satisfactory level. Reserves to capital ratio satisfactory level. TURNOVER RATIO The stock turn over shows fluctuating trend. Working capital turn over ratio shows fluctuating trend during the study period 2000-01 to 2009-10

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 Fixed asset turn over ratio shows fluctuating trend during the study period 2000-01 to 2009-10 PROFITABILITY RATIO Gross profit ratio shows fluctuating trend. Net profit ratio shows fluctuating trend. Return on investment shows highly decreasing trend. Operating profit ratio shows decreasing trend. Return on capital employed ratio shows decreasing trend during the study period 2000-01 to 2009-10. Z-SCORE ANALYSIS The Working capital to total asset ratio shows gradually decreasing trend. Retained earning to total asset shows increasing trend. Earning before interest and tax to total asset ratio shows decreasing trend. Market value of equity to book value of debt shows increasing trend during the study period 2000-01 to 2009-10. Sales to total asset ratio shows increasing trend

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 Z-score analysis shows that, in the later part of the study period, the company was in the healthy zone. It shows that the financial health of the company is improving.

SUGGESTIONS
Based on the findings the following suggestion are offered for the improvement of the financial performance of the company. LIQUIDITY RATIO Liquidity ratios of the India cements indicate an comfortable position. The current ratio and quick ratio is standard norm. TURN OVER RATIO The ratio of inventory turn over and working capital turn over was predicting short term solvency position of the company is found to be highly unsatisfactory. The proportion of inventory turn over ratio shows and increasing trend 2009-10. The working capital turn over ratio in the last year increasing trend 2009-10. the fixed asset turn over ratio increasing trend 2009-10. SOLVENCY RATIO Debt-equity ratio do not touch standard norm (1:1). So the company should increase shareholders fund. Proprietary ratio do not touch standard norm (1:1). So the company

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should increase shareholders fund. Current asset to proprietary fund do not touch standard norm (1:1). So the company should increase shareholders fund. Reserves to capital ratio increasing trend 2009-10. PROFITABILITY RATIO All profitability ratio are shows satisfactory level. In these sales was high. That is the main reason for the increase is profit. So the company should maintain the condition for future.

Z-SCORE ANALYSIS: Based on the findings as observed from the study, the following suggestions are deemed to be suitable for improving the financial health of the India cement company The company have to strengthen the inventory management system since the inventory is the major contributory to the current assets as well as the working capital. Working capital to total asset ratio shows gradually decreasing trend which indicates an uncomfortable position. So the company should take steps to increase the working capital.

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CONCLUSION The study of financial performance was undertaken in the India cements limited are financially sound and the performance is improving over 10 years 2000-01 to 2009-10 through there were some fluctuations. The liquidity position is satisfactory level. The solvency ratio is satisfactory level and the company's profitability position is satisfactory level, the increased profit is every year. The financial health plays a significant role in the successful functioning of a firm. The India cements ltd should healthy Zone in 2009-10. Apart from this the company is havening a good background and sound reputation with which no doubt; it will have an excellent progress in future.

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BIBLIOGRAPHY
Principles of Management Accounting, S.N.Maheshwari, Sultan Chand & Sons, New Delhi, 2007. Financial and Management Accounting, T.S.Reddy, Y. Hari Prasad Reddy, Margham Publications, Chennai, 2008. Management Accounting, Shashi K.Gupta and R.K.Sharma, Kalyani Publishers, New Delhi, 2003. Research Methodology, Kothari. C.R., Wishwa Prakashan, New Delhi, 1990. Statistical Methods, S.P.Gupta. Visual Basic 6.0 from the Ground up, Gary Cornel, www.indiacements.co.in

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