TABLE OF CONTENTS

Executive Summary Objectives of the Study Methodology of the Study Limitations of the Study IFFCO The Organization Chapter 1 Working Capital Management Data Analysis Findings Conclusion and Suggestions Conclusion Suggestions References Appendix

EXECUTIVE SUMMARY
Indian Farmers Fertiliser Co-operative Limited (IFFCO) is a Multistate Co-operative Society. It was a unique venture in which the farmers of the country through their own Cooperative Societies created this new institution to safeguard their interests. IFFCO manufactures Urea and NPK/ DAP fertilizers and sells them to the co-operative societies.

The project is Working Capital Management of IFFCO. The objectives of the project are: To analyse the working capital and working capital management policies at IFFCO To analyse the cash management practices at IFFCO The study is mainly based on the secondary data which refers to that form of information that has already been collected and is available. The analysis of working capital is based on ratio analysis to monitor overall trends in working capital and to identify areas requiring closer management.

Working capital is not measurable by only current assets & current liabilities but there are some other factors also that have an influence on the working capital. From the analysis of the components of working capital, it was found that the organization is utilizing its funds properly, the inventory is managed efficiently and the organization is able to get sufficient short term financing. It is clear that the working capital of IFFCO is in sound position. The suggestions can be made in the management of inventory by implementation of JIT or Kanban and management of liquid assets including the subsidy provided by the government.

The Cash Management System at IFFCO is very sound and efficient. It has enabled the organization to manage its funds in a proper manner resulting in better utilization and availability of funds in cash deficit periods. IFFCO has a tie up with banks such as IOB, HSBC Bank, ICICI Bank that are providing IFFCO with facilities such as cash management services, personalized financial MIS to enable IFFCO to accelerate the collection and payment of funds, debit sweep option, Anywhere banking facility, etc. The suggestion that can be given to the organization is the implementation of RTGS (Real Time Gross Settlement) and NEFT (National Electronic Fund Transfer) facilities which will improve the cash transfer at IFFCO.

OBJECTIVES OF THE STUDY

To analyse the Working Capital and ratio analysis at IFFCO To understand Working Capital Management of the organization To analyze Liquidity position of the organization To find out the Profitability and operating efficiency of the organization To understand the importance of Working Capital Management To analyze the short term financing patterns, which affect the working capital of the organization To study the factors that affects the Working Capital Management at IFFCO To analyze the data and information of the previous years to know the actual position of funds, investments and liabilities of the organization To identify some broad policy measures to improve the working capital position of the organization To estimate the working capital requirements of the organization in the near future

METHODOLOGY OF THE STUDY

The basic type of research used to prepare this report is Descriptive. The study is mainly based on the secondary data which refers to that form of information that has already been collected and is available. These include some internal sources within the company and externally these sources include books and periodicals, published reports and data of IFFCO and the annual reports of the company. Interaction with the various employees of the marketing accounts department has also been a major source of information. No primary data has been used as a part of this study. The analysis of working capital is based on ratio analysis to monitor overall trends in working capital and to identify areas requiring closer management.

LIMITATIONS OF THE STUDY

The following are the limitations of this summer project training: The study is limited to five financial years i.e. from 2008-2009. The data used in this study has been taken from the Financial Statements & their related schedules of IFFCO Ltd., New Delhi as per the requirement. Some of the information that was essential for this study cannot however be given in this report due to their confidential nature. The scope and area of the study was limited to corporate office of IFFCO, New Delhi only.

IFFCO THE ORGANIZATION

Indian Farmers Fertiliser Co-operative Limited (IFFCO) was registered on November 3, 1967 as a Multi-unit Co-operative Society. It was a unique venture in which the farmers of the country through their own Co-operative Societies created this new institution to safeguard their interests. The numbers of cooperative societies associated with IFFCO have risen from 57 in 1967 to 38, 155 at present. On the enactment of the Multistate Cooperative Societies act 1984 & 2002, the Society is deemed to be registered as a Multistate Cooperative Society. The byelaws of the Society provide a broad frame work for the activities of IFFCO as a Cooperative Society.

IFFCO commissioned an Ammonia - urea complex at Kalol and the NPK/DAP plant at Kandla both in the state of Gujarat in 1975. Another Ammonia - urea complex was set up at Phulpur in the state of Uttar Pradesh in 1981. The ammonia - urea unit at Aonla was commissioned in 1988.

In 1993, IFFCO had drawn up a major expansion programme of all the four plants under overall aegis of IFFCO VISION 2000. The expansion projects at Aonla, Kalol, Phulpur and Kandla have been completed on schedule. Thus all the projects conceived as part of Vision 2000 have been realised without time or cost overruns. All the production units of IFFCO have established a reputation for excellence and quality.

A new growth path has been chalked out to realise newer dreams and greater heights through Vision 2010 which is presently under implementation. As part of the new vision, IFFCO has acquired fertiliser unit at Paradeep in Orissa in September 2008. As a result of these expansion projects and acquisition, IFFCO's annual capacity has been increased to 3.69 million tonnes of Urea and NPK/DAP equivalent to 1.71 million tonnes of P2O5.

MISSION
IFFCO's mission is "to enable Indian farmers to prosper through timely supply of reliable, high quality agricultural inputs and services in an environmentally sustainable manner and to undertake other activities to improve their welfare."

To provide to farmers high quality fertilizers in right time and in adequate quantities with an objective to increase crop productivity.

To make plants energy efficient and continually review various schemes to conserve energy.

Commitment to health, safety, environment and forestry development to enrich the quality of community life.

Commitment to social responsibilities for a strong social fabric. To institutionalise core values and create a culture of team building, empowerment and innovation which would help in incremental growth of employees and enable achievement of strategic objectives.

Foster a culture of trust, openness and mutual concern to make working a stimulating and challenging experience for stake holders.

Building a value driven organisation with an improved and responsive customer focus. A true commitment to transparency, accountability and integrity in principle and practice.

To acquire, assimilate and adopt reliable, efficient and cost effective technologies. Sourcing raw materials for production of phosphatic fertilisers at economical cost by entering into Joint Ventures outside India.

To ensure growth in core and non-core sectors.

A true Cooperative Society committed for fostering cooperative movement in the country.

IFFCO is emerging as a dynamic organisation, focussing on strategic strengths, seizing opportunities for generating and building upon past success, enhancing earnings to maximise the shareholders' value.

Vision
To augment the incremental incomes of farmers by helping them to increase their crop productivity through balanced use of energy efficient fertilizers, maintain the environmental health and to make cooperative societies economically & democratically strong for professionalized services to the farming community to ensure an empowered rural India.

Vision 2010 Encouraged by the success of Vision 2000, IFFCO has charted on a new course of action to realise a fresh set of dreams. A high powered committee has been constituted to steer the organisation through this Road Map. Activities being actively pursued through the strategy are: Phosphoric Acid plant Foray into Power Sector to set up a 500 MW power project Ammonia Plant for supplies to Kandla Unit IFFCO Kisan Bazar IFFCO Bank Multi Commodity Exchange Acquisition of Fertilizer Plants Nellore Fertilizer Project Agri business

The Approach
To achieve their mission, IFFCO as a cooperative society, undertakes several activities covering a broad spectrum of areas to promote welfare of member cooperatives and farmers. The activities envisaged to be covered are exhaustively defined in IFFCOs Bye-laws.

The Commitment
The thirst for ever improving the services to farmers and member co-operatives is insatiable, commitment to quality is insurmountable and harnessing of mother earths' bounty to drive hunger away from India in an ecologically sustainable manner is the prime mission.

Plants owned by IFFCO

Kalol Unit (Ammonia - Urea complex) P. O. Kasturinagar, District Gandhinagar, Gujarat - 382423

8 Kandla Unit (NPK/DAP plant) P. O. Kandla, Gandhidham, Kandla (Kachchh), Gujarat - 370201 Phulpur Unit (Ammonia - urea complex) P. O. Ghiyanagar, District Allahabad, Uttar Pradesh - 212404 Aonla Unit (Ammonia - Urea unit) P. O. IFFCO Township, Paul Pothen Nagar, Bareilly, Uttar Pradesh - 243403 Paradeep Unit (NPK/DAP and Phosphoric Acid Fertiliser unit) Village Musadia, P. O. Paradeep, District Jagatsinghpur, Orissa - 754142

Production and Sales

During the year 2012-13 IFFCO produced 71.68 Lakh (7.168 million) MT (Metric Tonnes) of fertiliser material, consisting of 40.68 lakh MT of Urea and 31.00 lakh MT NPK/DAP. It contributes 21.4% of countrys total nitrogenous fertiliser production and 27% of total phosphatic fertiliser production in the same period. PRODUCTION (in LAKH MT) YEAR 2010-11 2011-12 2012-13
80 70 60

UREA 37.87 39.63 40.68

NPK / DAP 32.26 28.84 31

TOTAL 70.13 68.47 71.68

70.13

68.47

71.68

Lakh MT

50 40 30 20 10 0

37.87

39.63 32.26 28.84

40.68 31

2006-07

2010-11
UREA

2007-08 2011-12 NPK / DAP TOTAL

2008-09 2012-13

Material UREA NPK/ DAP TOTAL

SALES OF FERTILIZER MATERIAL (in Lakh MT) 2010-11 2011-12 58.69 54.29 53.89 38.95 112.58 93.24

2012-13 52.41 33.69 86.10

120 100

112.58 93.24 86.10

Lakh MT

80 60 40 20 0 2008-09 2010-11 UREA 2007-08 2011-12 NPK/ DAP TOTAL 2006-07 2012-13 58.69 53.89 54.29 38.95 52.41 33.69

PLANT WISE PRODUCTION Unit 2012-13 Production (Lakh MT) UREA Kalol Phulpur I Phulpur II Aonla I Aonla II SUB TOTAL UREA NPK / DAP Kandla Paradeep SUB TOTAL NPK / DAP TOTAL PRODUCTION 5.60 6.63 8.40 9.87 10.18 40.68 17.94 13.06 31.00 71.68 Capacity Utilization (percent) 102.80 120.30 97.20 114.10 117.80 110.30 74.30 68.00 71.40 89.20 2011-12 Production (Lakh MT) 5.45 6.30 9.24 8.76 9.89 39.63 20.18 8.66 28.84 68.47 Capacity Utilization (percent) 100.00 114.30 106.90 101.30 114.40 107.40 83.50 45.10 66.50 85.30

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All India Capacity, Production and Capacity Utilization of Fertilizer Industry Year N P2O5 Capacity Capacity Capacity Production Utilization Capacity Production Utilization (%) (%) 2008-09 12208 11304.9 93.4 5480.4 4038.4 75.5 2009-10 12288.4 11332.9 94.5 5459.6 4202.6 78.5 2010-11 12290.4 11524.9 95.6 5736.3 4440 78.5 2011-12 12290.4 10902.8 95.2 5874.6 3714.3 64.7 2012-13 12290.4 10900.2 95.2 5892.3 3417.3 58.5

Sector Wise Capacity and Production of N and P2O5 (capacity: As on 1.11.2013) (production: 2012-13 April-March) (Figures in '000 tonne nutrient) N P2O5 Capacity Production Capacity Production NP/NPKs SSP Total NP/NPKs SSP Total 3591.5 2973.2 386.7 386.7 191.7 191.7 6030.3 3423.4 13045.2 4829.9 3133.1 10900.2 2860.1 1712.8 4959.6 1225 4085.1 1712.8 1903.9 916.3 3011.9 405.4 2309.3 916.3

Sector

Public Private Cooperative Total

1225 6184.6

405.4 3417.3

Year / Period

2007-2008 (as on 1.11.2008) 2008-2009 (as on 1.11.2009) 2009-2010 (as on 1.11.2010) 2010-2011 (as on 1.11.2011) 2011-2012 (as on 1.11.2012)

Capacity and Investment in the Fertilizer Industry Investments During the Period ( in Rs. Crore ) Capacity During the Period (in '000 tonnes) Sectors N P2O5 Public Cooperative Private Total 62 39 10 10 12229 5427 7474.5 4231.5 14227.9 25933.9 -21 1 3 3 12208 5428 7474.5 4231.5 14230.9 25936.9 52 243 350 35 385 12260 5671 7824.5 4231.5 14265.9 26321.9 30 204 15 15 12290 5875 7824.5 4231.5 14280.9 26336.9 17 55 55 12290 5892 7824.5 4231.5 14335.9 26391.9

11 2012-2013 (as on 1.11.2013) 755 13045 293 6185 7824.5 350 4581.5 470 14805.9 820 27211.9

BIO FERTILISERS
Bio-fertilisers are capable of fixing atmospheric nitrogen when suitable crops are inoculated with them. Bio-fertilisers are low cost, effective, environmental friendly and renewable source of plant nutrients to supplement fertilisers. Integration of chemical, organic and biological sources of plant nutrients and their management is necessary for maintaining soil health for sustainable agriculture. The bacterial organisms present in the bio-fertiliser either fix atmospheric nitrogen or solubilise insoluble forms of soil phosphate. The range of nitrogen fixed per ha/year varies from crop to crop; it is 80 - 85 kg for cow pea, 50 - 60 kg for groundnut, 60 - 80 kg for soybean and 50 - 55 kg for moongbean.

All India Production and Dispatches of Bio Fertilizers ( in tonnes) Year Production Dispatches 2008-09 10479 10427.6 2009-10 11752.4 11357.6 2010-11 15871 15745 2011-12 20111.1 20100 2012-13 24455 24400

PRICES OF IFFCO'S FERTILISERS

(Applicable only within India) UREA N-46% M.R.P. 4830 NPK 10-26-26 12-32-16 7197 7637 20:20:00 6295 DAP 18-46-0 9350 MOP K-60% 4455

Local Taxes Extra, where ever applicable.

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JOINT VENTURES OF IFFCO

Indian Potash Limited (IPL) The Society holds an investment of Rs. 2.68 Crore (2012-13) in Indian Potash Limited (IPL) with equity share holding of 34 per cent in the paid up equity share capital of IPL. IPL is primarily engaged in trading of imported Potassic and NonPotassic Fertilisers. Industries Chimiques Du Senegal (ICS) The Society holds 18.54 per cent equity (2012-13) in ICS, which manufactures Phosphoric Acid for exports and Phosphatic Fertilisers for domestic consumption. ICS has the capacity to produce 660000 MT of Phosphoric Acid (as P2O5) per year. The Government of Senegal and IFFCO signed an Agreement on 16th July, 2011 and Amendment on 14th January, 2012, for the debt restructuring and recapitalisation of ICS. Post restructuring and recapitalisation, the new Board has been reconstituted and the IFFCO Consortium has taken over the management control of ICS. Indo Egyptian Fertilisers Company, SAE (IEFC) The Society promoted a joint venture in Egypt, namely Indo Egyptian Fertilisers Company SAE (IEFC) along with El Nasr Mining Company of Egypt to set up a Phosphoric Acid plant with a capacity of 1500 tonnes P2O5 per day. IEFC was incorporated in Egypt as a Joint Stock Company on 15th November, 20 with shareholding of IFFCO and its affiliates at 76 percent and El Nasr Mining Co. Egypt holding 24 per cent equity. Oman India Fertiliser Company (OMIFCO) Oman India Fertiliser Company (OMIFCO) is a Joint Venture Company in Oman in which the Society has invested an amount of Rs. 329.08 Crore (2012-13) to acquire 25 percent equity in OMIFCO, which has an installed capacity of 16.52 lakh tonne Urea and 2.5 lakh tonne surplus Ammonia. OMIFCO commenced commercial production at its plant at Sur (Oman) with effect from 14th July, 2008.

13 Jordan India Fertilizer Company (JIFCO) IFFCO and Jordan Phosphate Mines Company (JPMC), Jordan have formed a Limited Liability Joint Venture Company, namely Jordan India Fertilizer Company (JIFCO) on 6th March, 2008 in Amman, Jordan under the Free Zone system to set up a phosphoric acid plant of capacity 1500 tonnes per day P2O5 at Eshidiya in Jordan. In this company, IFFCO holds 52 per cent equity, while JPMC holds 48 per cent equity. Aria Chemicals (Orissa) Limited Aria Chemicals (Orissa) Ltd. is a joint venture between IFFCO and Aria Chemicals Private Limited, Chennai wherein IFFCO holds 40 percent equity in this project. This Company will set up an Aluminium Fluoride facility at Paradeep.

Sector Diversification of IFFCO

IFFCO-TOKIO General Insurance Company Limited (ITGI) IFFCO TOKIO General Insurance Company Limited (ITGI) was formed as a Joint Venture Company in the year 2000 for underwriting general insurance business in India. Out of total equity capital of Rs. 247 Crore in ITGI, the Society and its associates hold 74 percent equity and Tokio Marine Asia holds 26 percent. ITGI had launched products like, Barish Bima Yojna, Mausam Bima Yojna and Kisan Suvidha Bima Yojna to cater to the insurance requirements of the farmers. During the year ITGI has launched various micro insurance policies like Janta Bima Yojna, Jansuraksha Bima Yojna, Janswasthya Bima Yojna and Mahila Suraksha Bima Yojna to provide protection to the farmers and their families and also poorer sections for their household goods, personal accident and health.

IFFCO Chhattisgarh Power limited (ICPL) The Society has diversified into the Power Sector by incorporating a Joint Venture Company namely IFFCO Chhattisgarh Power Limited (ICPL) with Chhattisgarh State Electricity Board (CSEB) to set up a 1320 MW coal-based Mega Power Plant in District Surguja of Chhattisgarh. The Society will hold 74 per cent equity in ICPL.

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National Commodity and Derivatives Exchange Ltd. (NCDEX) The Society holds 12 percent equity in the Paid-up Share Capital (Rs. 30 Crore) and the entire preference capital of Rs. 10 Crore in the National Commodity and Derivative Exchange Limited (NCDEX). NCDEX is a demutualised, on-line national level commodity exchange providing a trading platform for futures trading in commodities in the country and offers its market participants opportunity at price discovery and price risk hedging. Currently, NCDEX offers contracts in 56 commodities, that is, 42 agricultural commodities, 2 bullion, 6 metals, 2 energy and 3 polymers and 1 environment (carbon credit). National Collateral Management Services Ltd. (NCMSL) Along with other reputed institutions, IFFCO co-promoted National Collateral Management Services Limited (NCMSL) in the year 2004. The Society holds 13.56 per cent of the paid up equity capital in NCMSL. NCMSL is engaged in providing various risk management services related to commodities like Storage and Preservation services, Collateral Management services, Procurement services, Quality Testing and Certification services and Information services. Freeplay Energy India Pvt. Ltd. During the year 2012-13, the Society made an investment of Rs. 4.83 Crore to acquire 30 percent shareholding in Freeplay Energy India Pvt. Ltd. (FPEI), which is engaged in the field of non-conventional energy products and devices suitable for rural India. These products are being marketed to co-operative societies through Societys another subsidiary company, that is, IFFCO Kisan Sanchar Ltd. The utility of these products has been greatly appreciated by the rural farmers.

ORGANIZATIONS PROMOTED BY IFFCO

IFFCO has promoted several institutions and organisations to work for the welfare of farmers, strengthening cooperative movement, improve Indian agriculture. Indian Farm Forestry Development Cooperative (IFFDC)

15 Indian Farm Forestry Development Cooperative, a multi-state cooperative society promoted by IFFCO, has been implementing afforestation projects in Uttar Pradesh, Rajasthan & Madhya Pradesh. The Society has been floated under contribution agreement signed between IFFCO and India - Canada Environment Facility (ICEF). Development of Primary Farm Forestry Cooperative Societies (PFFCS) is an important activity undertaken towards afforestation of waste lands. High participation of women is an important feature of the IFFDC. Cooperative Rural Development Trust (CORDET) IFFCO promoted Cooperative Rural Development Trust (CORDET) in the year 1979 to provide education and training to farmers on various aspects of crop production, horticulture, animal husbandry, farm machinery etc. IFFCO Kisan Sewa Trust (IKST) Objective: A Relief Trust for the Welfare of the Victims of Natural Calamities Kisan Sewa Trust Fund was created out of contributions from: IFFCO Employees of IFFCO Cooperative Societies and others TOTAL Rs 100 million Rs 10 million Rs 90 million Rs 200 million

IFFCO had always been in the forefront of activities for the rescue of victims of natural calamities. Every year significant contributions, both monetary as well as in kind, are made by IFFCO along with separate contributions by the employees. IFFCO Kisan Sanchar Limited (IKSL) IFFCO Kisan Sanchar Limited was incorporated in April, 2007 with the objective to use the information technology to empower farmers in rural areas and to strengthen the cooperative network in the country. The highlight of IKSLs services in the rural telecom domain continues to be Valued Added Services (VAS) extended to the subscribers. Five free voice messages of immediate relevance to people living in rural areas, a Help Line with experts to provide information inputs to the farmers and

16 several other innovative activities for subscribers constitute a major source of knowledge transfer.

An ambitious project 'ICT Initiatives for Farmers and Cooperatives' is launched to promote e-culture in rural India. IFFCO obsessively nurtures its relations with farmers and undertakes a large number of agricultural extension activities for their benefit every year. At IFFCO, the thirst for ever improving the services to farmers and member co-operatives is insatiable, commitment to quality is insurmountable and harnessing of mother earths' bounty to drive hunger away from India in an ecologically sustainable manner is the prime mission. All that IFFCO cherishes in exchange is an everlasting smile on the face of Indian Farmer who forms the moving spirit behind this mission. IFFCO, to day, is a leading player in India's fertiliser industry and is making substantial contribution to the efforts of Indian Government to increase food grain production in the country. IFFCO is also behind several other companies with the sole intention of benefitting farmers.

The distribution of IFFCO's fertiliser is undertaken through over 38155 co-operative societies. The entire activities of Distribution, Sales and Promotion are co-ordinated by Marketing Central Office (MKCO) at New Delhi assisted by the Marketing offices in the field. In addition, essential agro-inputs for crop production are made available to the farmers through a chain of 158 Farmers Service Centre (FSC).

SUBSIDIARIES OF IFFCO
Kisan International Trading FZE (KIT) Kisan International Trading FZE (KIT) was set up as a wholly owned subsidiary of the Society in Dubai in April 2008. KIT has become a leading international trading organisation, which handles the import and export of various fertilisers and fertiliser Raw Materials and Intermediates. IFFCO Kisan Bazar Ltd.

17 IFFCO Kisan Bazar Ltd. (IKBL) was incorporated on 26th February, 2007 as IFFCOs wholly owned subsidiary company for inter-alia undertaking business in agri-inputs and consumer goods for the benefit of farmers/cooperatives.

Business and Financial Review of Subsidiaries and Associates

Even in the year of global economic meltdown, the business portfolio has been steadily growing in tandem with the high growth aspirations. The organization have stepped up investments in related businesses through various Joint Ventures and Associate Companies in order to strengthen themselves further by looking at new opportunities that are unfolding and create value addition in the core fertiliser sector. On 31st March 2009, the total investments were Rs. 914 Crore in comparison to Rs.770.57 Crore on 31st March 2008 as per the following break-up: (Rs. In Crore) As on 31st March 2013 Investment in Jt. Ventures/Subsidiaries Investment in Business Associates Total 888.27 25.73 914.00 2012 750.13 20.44 770.57

FINANCIAL PERFORMANCE
As per its tradition, the Society has again exhibited an impressive financial performance in all its major parameters, namely, Revenue Growth and Resource Utilisation, testifying to the robustness of its Corporate Strategy of creating multiple drivers of growth in spite of constraints in the availability of raw materials, the Global Economic Meltdown and inordinate delays in receipt of large subsidy amounts from the Government of India. This was possible due to higher production, sales volume and improvement in operating efficiencies.

The Society achieved the highest ever sales turnover of Rs 32,933 Crore. This represents an increase of 170 per cent over the previous year. While, the sales volume of fertiliser material increased by 20 per cent to 112.58 lakh MT fertiliser during 2012-13, as against 93.24 lakh MT in the previous year, the major increase in the sales turnover was on account of

18 substantial increase in the commodity prices. The performance is even more satisfying when viewed in the light of the challenging business environment of the fertiliser industry.

SOURCES AND USES OF FUNDS

The Cash Flow from Operating, Investing and Financing activities as reflected in the Cash Flow Statement is summarised in the following table: (Rs. In Crore) 2012-13 Cash provided by operating activities Cash Used in Investing activities Cash provided by financing activities Decrease in cash and cash equivalents 1560 (6578) 4844 (174) 2011-12 1072 (970) (190) (88)

CORPORATE GOVERNANCE
The Society has consistently followed transparent, democratic and professional practices in Corporate Governance since its inception. We have carved out a strong Cooperative Identity and are making sincere efforts to uphold the Cooperative Values by cherishing Cooperative Principles. The Societys endeavour has been to achieve the highest levels of transparency, accountability and full disclosure to its shareholders in a bid to uphold the spirit of Cooperative Principles and Cooperative Values by following the charter as lay down by International Cooperative Alliance (ICA). The activities of the Society have been conducted within the provisions of the Multi State Cooperative Societies Act/Rules and IFFCO Byelaws. A separate detailed report on Corporate Governance is given along with the Annual Report.

FINANCIAL RATINGS
The Societys excellent credit ratings with bankers and rating agencies allows access to short term funds including foreign currency borrowings at competitive rates. Ratings assigned by different Rating Agencies to the Society were as under: CRISIL Ratings

19 Rating for Governance and Value Creation (GVC) Practices of IFFCO CRISIL has, assigned a GVC Level 2 rating to IFFCO. This rating indicates that the capability of the Society with respect to wealth creation for all its stakeholders, while adopting sound corporate governance practices, is high. Rating for the Rs. 100 crore Commercial Paper Programme of IFFCO CRISIL has assigned a P1+ (pronounced P One Plus) rating to IFFCOs Rs.100 Crore Commercial Paper Programme. This rating indicates that the degree of safety with regard to timely payment of interest and principal on the instrument is Very Strong. Rating for the Rs. 400 crore Bonds Programme of IFFCO CRISIL has assigned the rating on IFFCOs Long Term Borrowing Programme to AA/Stable. The rating indicates high degree of safety with regard to timely payment of interest and principal on the instrument. FITCH Ratings Rating for the Rs. 100 crore Commercial Paper Programmes of IFFCO FITCH Ratings has assigned a National Short Term Rating of F1+ (Ind)to IFFCOs Rs. 100 crore Commercial Paper Programme. This rating indicates that the degree of safety with regard to timely payment of interest and principal on the instrument is Very Strong. Rating for Long Term Borrowing Programme of IFFCO FITCH Ratings assigned National Long - Term Rating of AA+ (Ind) to the Long Term Debt Programme of IFFCO. The outlook on the Long Term Rating is Stable. This rating indicates high degree of safety with regard to timely payment of interest and principal on the instrument. CARE Ratings PR 1+ (P One Plus) rating to IFFCOs Working Capital facilities/Short Term Loans having tenure of up to one year. CARE AA (Double A) rating to External Commercial Borrowings and other existing long term borrowings having tenure of over one year.

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Value Added
Value Added is the wealth which an enterprise has been able to create through the collective effort of capital, management and employees. In economic terms, value added is the market price of the output of an enterprise less the price of the goods and services acquired by transfer. Value Added can provide a useful measure in gauging performance and activity of the company.
85.10, 3.36% 1.75, 0.07% 3.59, 0.14% Employee Cost 747.90, 29.54% 1023.20, 40.42% Interest Payment Income Tax (Net) Dividend 595.96, 23.54% Donations Cooperative Education Fund Retained Cash Profit

74.00, 2.92%

Figure: Allocation of Value Added

SIGNIFICANT ACCOUNTING POLICIES

1. Basis of Preparation of Financial Statements The Financial Statements are prepared on accrual basis of accounting under the historical cost convention in accordance with the generally accepted accounting principles in India, the Accounting Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of Multi State Co-operative Societies Act, 2002. 2. Use of Estimates The preparation of financial statements, in conformity with the generally accepted accounting principles, require estimates and assumptions to be made that affect the reported amount of assets and liabilities as of the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates are recognized in the period in which the results materialise.

21 3. Fixed Assets (i). Fixed Assets are stated at historical cost less accumulated depreciation. Cost comprises of the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. (ii). Assets retired from active use and held for disposal are shown separately under Fixed Assets at lower of net book value and estimated realisable value. 4. Expenditure incurred during Construction Period In respect of new/major expansion of units, the indirect expenditure incurred during construction period up to the date of the commencement of commercial production, which is attributable to the construction of the project, is capitalised on proportionate basis. 5. Intangible Assets An intangible asset is recognised where it is probable that the future economic benefits attributable to the asset will flow to the Society and the cost of the asset can be measured reliably. Such assets are stated at cost less accumulated amortisation. 6. Impairment of Assets At each balance sheet date an assessment is made whether any indication exists that an asset has been impaired. If any such indication exists, an impairment loss i.e. the amount by which the carrying amount of an asset exceeds its recoverable amount, is provided in the books of account. 7. Investments i) Long Term Investments are carried at cost. Provision for diminution in the value of such investments is made to recognise a decline, other than temporary, in the value of the investments. ii) Current Investments are valued at lower of cost and fair value determined on an individual investment basis. 8. Depreciation / Amortisation (a) Depreciation on Fixed Assets is provided on Straight Line Method as follows: (i) In respect of assets acquired up to 31st March, 1990 at the rates prescribed under Income tax Act, 1961 and rules framed there under. (ii) In respect of assets acquired after 31st March,1990 at the rates based on schedule XIV to the Companies Act,1956 except for fixed assets taken

22 over at Paradeep Unit which are depreciated based on useful life of such assets. (b) Assets are depreciated to the extent of 95% of the original cost except assets individually costing up to Rs.5000/- which are fully depreciated in the year of acquisition. (c) Railway wagons under "Own Your Wagon Scheme" are depreciated over a period of ten years. (d) Machinery Spares which can be used only in connection with an item of Plant & Machinery and its use is expected to be irregular, are fully depreciated over the remaining useful life of the related asset. (e) Premium paid for acquisition of leasehold land, other than those acquired under perpetual lease basis, is amortised over the period of lease. (f) Leasehold Buildings are fully depreciated over the period of lease in case period of lease is less than the useful life derived from the rates as per Schedule- XIV of Companies Act. (g) Additions to assets are depreciated for the full year irrespective of the date of addition and no depreciation is provided on assets sold/ discarded during the year. However, in the case of capitalisation of project, depreciation is provided on a pro-rata basis from the date of commencement of commercial production. (h) Intangible assets are amortised over their estimated useful lives but not exceeding ten years when the asset is available for use. 9. Provisions, Contingent Liabilities and Contingent Assets (a) Provisions are recognised for liabilities that can be measured by using a substantial degree of estimation, if: i) ii) The Company has a present obligation as a result of a past event; A probable outflow of resources embodying economic benefits is expected to settle the obligation; and iii) The amount of the obligation can be reliably estimated.

(b) Contingent liability is disclosed in case of : i) Present obligation arising from a past event when it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation.

23 ii) Possible obligation, unless the probability of outflow in settlement is remote. (c) Reimbursement expected in respect of expenditure required to settle a provision is recognised only when it is virtually certain that the reimbursement will be received. (d) Contingent assets are neither recognised nor disclosed in the financial statements. 10. Operating Leases Assets acquired on leases wherein a significant portion of the risks and rewards of ownership are retained by the lessors are classified as operating leases. Lease rentals paid for such leases are recognised as an expense on straight line basis over the term of lease. 11. Prior Period Income / Expenditure Income/Expenditure items relating to prior period(s) not exceeding Rs.2,00,000/- each is treated as Income/ Expenditure for the current year. 12. Pre-Paid Expenses Expenditure up to Rs.50000/- in each case except Insurance Premium is accounted for in the year in which the same is incurred.

24

WORKING CAPITAL RATIO ANALYSIS

The main purposes of Working Capital Ratio Analysis are: To indicate working capital management performance; and To assist in identifying areas requiring closer management Three key points need to be taken into account when analyzing financial ratios. These key points are as follows: The results are based on highly summarized information. Consequently, situations, which require control, might not be apparent, or situations, which do not warrant significant effort, might be unnecessarily highlighted. Different departments face very different situations. Comparisons between them, or with global ideal ratio values, can be misleading. Ratio analysis is somewhat one-sided; favourable results mean little, whereas unfavourable results are usually significant.

However, financial ratio analysis is valuable because it raises questions and indicates directions for more detailed investigation.

Sources of Cash
The various sources of cash that provide the money to fund the working capital include the following: Existing cash reserves Payables (credit from suppliers) New equity or loans from shareholders Bank overdrafts or lines of credit Long term loans Profit or net income

Inventory Management
Inventories constitute the most significant part of current assets. Inventories are stock of the product, a company is manufacturing for sale and components to make that product. The various forms of inventory in a fertilizer manufacturing company are:

25
Raw Materials are those basic inputs that are converted into the finished products through the process of manufacturing. Work-In-Progress inventories are semi-manufactured products. Finished Goods inventories are completely manufactured products. Stores & Spares, loose tools, chemical catalysts, packing & Construction materials

OBJECTIVES OF INVENTORY MANAGEMENT

The problems faced by an organization in the context of inventory management are:

To maintain a large size of inventory for efficient and smooth production & sales operation To maintain minimum investment in inventories to maximize profitability To ensure continuous supply of materials, spares & finished goods. To avoid both overstocking & under stocking of inventory To eliminate duplicate stock orders. This is possible with the help of a centralized purchasing system. To design proper organization for inventory management Both Excessive & Inadequate Inventories are not desirable. The objective of Inventory Management is to determine & maintain the optimum level of inventory investment. The optimum level of inventory will lie between two danger points of excessive & inadequate inventories. Excessive stocks can place a heavy burden on the cash resources of a business. Insufficient stocks can result in lost sales, delays for customers etc. The key is to know how quickly the stocks are moving or how long each item of stock sits on shelves before being sold. Average stock holding periods are influenced by the nature of the business. The key issue for a business is to identify the fast and slow stock movers with the objective of establishing optimum stock levels for each category and thereby minimize the cash tied up in the stocks. Factors to be considered when determining the optimum stock levels include: What are the projected sales of each product? How widely available are each component, raw materials, etc.? How long does it take for delivery by the suppliers?

26 Can one remove the slow movers from ones product range without compromising on the best- sellers? For better stock control, following measures can be adopted: Review the effectiveness of existing purchasing & inventory systems. Know the stock turnover for all major items of inventory. Apply tight controls to the significant few items & supply control for the remaining. Sell off outdated or slow moving merchandise. Consider the idea of outsourcing the manufacturing of the product to another manufacturer. Review security procedures to minimize losses through deterioration, pilferage, wastage & damages. To facilitate furnishing of data for short-term & long-term planning & control of inventory

Receivable Management
Accounts Receivable refers to the amount owed by the debtors to the business. They are usually created because of trade credit that is given to the customers of the business. These receivables have three characteristics: It involves an element of risk, which should be carefully analyzed. It is based on economic value It implies futurity.

To maintain a proper flow of funds in the business in order to make timely payments to the creditors, to buy raw materials & to run the day-to-day activities of the business, it is essential that the debtors make their payments on time. The interval between the date of sale & the date of payment has to be financed out of the working capital. Thus, trade debtors represent investment. Objectives of Receivable Management The objective of Receivable Management is to promote sales & profits until that point is reached where the returns that the company gets from funding receivables is less than the

27 cost that the company has to incur in order to fund these receivables. However, to maintain these receivables the company has to incur certain costs such as: Additional fund requirements for the company When a firm maintains receivables, some of its resources remain blocked in them so to finance the activities during that time gap the firm requires funds. Administrative Costs Collecting Costs Defaulting Costs The size of receivables or investment in Receivable Management is determined by the firms credit policy & level of sales. Receivable management is the process of making the decision of selection of trade debtors in which the funds could be invested or to whom money can be given. Receivable management involves the careful consideration of the following aspects: Forming the credit policy Executing the credit policy Formulating & executing the collection policy The Credit Policy is the policy followed by the company with respect to the credit standards adopted, any incentive in the form of cash discount offered, and also the period over which the discount can be utilized by the customers & the collection effort made by the company. All these variables underlying a companys credit policy influence the volume of sales and hence the profits of the company.

Cash Management
Cash, the most liquid asset and also referred to as the life blood of a business enterprise and is of vital importance to the daily operations of the business firms. Its efficient management is crucial to the solvency of the business because cash is the focal point of the fund flows in a business. If a business has no cash and no way of getting any cash, it will have to close down. Cash Management is concerned with the managing of: Cash flows into and out of the firm.

28 Cash flows within the firm Cash balances held by the firm at a point of time for financing deficits or investing Surplus cash. Cash Management refers to management of cash balance and the bank balance and also short term deposits. The term cash may be used in two different ways:

1) It may include currency, cheques, drafts, demand deposits held by the firm i.e. pure cash or generally accepted cash equivalents.

2) In a broader sense, it also includes near cash assets such as marketable securities and short term deposits with banks. For cash management purposes, the term cash is used in this broader sense i.e. it covers cash, cash equivalents and those assets which are immediately convertible to cash.

Objectives of Cash Management The cash management strategies are generally built around two goals: To provide cash needed to meet the obligations, and To minimize the idle cash held by the firm The risk return trade-off of any firm can be reduced to two prime objectives for th e firms Cash Management System: 1) Meeting the Cash Outflows: This will help the firm in avoiding the chance to default in meeting financial obligations otherwise the goodwill of the firm is adversely affected. Also this will further help in availing the opportunities of getting cash discounts by making early or prompt payments and meeting unexpected cash outflows without much problem. 2) Minimizing the Cash Balance

Loans and Advances

Loans and Advances are one of the important factors of working capital. In current assets loans and advances play a significant role. When we talk about the working capital

29 management it is necessary to consider Loans & Advances, as they are a major component of Current assets and along with the equity of the company for a source of generating cash in the organization. While analyzing the loans & advances position of IFFCO the following ratios have to be calculated for better understanding i.e. Loans and advances to Current Assets ratio Loans and advances to Working capital ratio

Operating Cycle
Operating Cycle is the times duration required to convert sales, after the conversion of resources into inventories, into cash. The operating cycle of a manufacturing company involves three phases: Acquisition of resources such as raw material, labour, power and fuel etc. Manufacture of the product which includes conversion of raw material into workin-progress into finished goods. Sale of the product either for cash or on credit. Credit sales create account receivable for collection.

Credit Sales Purchases Inventory Period

Collection

Accounts Receivable Period

Accounts Payable Period Payments

Cash Conversion Cycle

Operating Cycle The operating cycles are of two types: 1. Gross Operating Cycle 2. Net Operating Cycle or Cash Conversion Cycle

30

Gross Operating Cycle Gross operating cycle is a tool which measures the total number of days from the day the purchases are made or the stock arrives to the day all the collections are made. Cash is said to be blocked till the collections have been collected. So the sooner the cash is received from the consumers the better is for the company as they get cash for further production. Gross Operating Cycle is given as follows: Operating cycle (OC) = Days Inventory Outstanding(DIO) + Days Sales Outstanding(DSO)

Cash Conversion Cycle The cash conversion cycle (also referred to as CCC or the net operating cycle) is the analytical tool of choice for determining the investment quality of two critical assets inventory and accounts receivable. The CCC tells us the time (number of days) it takes to convert these two important assets into cash. A fast turnover rate of these assets is what creates real liquidity and is a positive indication of the quality and the efficient management of inventory and receivables. The cash conversion cycle is comprised of three standard, so-called activity ratios relating to the turnover of inventory, trade receivables and trade payables. These components of the CCC can be expressed as a number of times per year or as a number of days. CCC = Days Inventory Outstanding (DIO) + Days Sales Outstanding (DSO) - Days Payable Outstanding (DPO) The cash conversion cycle (CCC) measures how fast a company can convert cash on hand into even more cash on hand. The CCC does this by following the cash as it is first converted into inventory and accounts payable (AP), through sales and accounts receivable (AR), and then back into cash. Generally, the lower this number is the better for the company. The components of CCC are calculated as follows: Days Inventory Outstanding (DIO) This addresses the question of how many days it takes to sell the entire inventory. The smaller this number is the better. Days Inventory = Average Inventory

31 Outstanding (DIO) Cost of Goods sold (COGS) / 365

Broadly, the smaller number of days, the more efficient a company - inventory is held for less time and less money is tied up in inventory. Instead, money is freed up for things like research and development, marketing or even share buybacks and dividend payments. If the number of days is high, that could mean that sales are poor and inventories are piling up in warehouses. If inventory days are increasing, thats not necessarily a bad thing. Companies normally let inventories build up when they are introducing a new product in the market or ahead of a busy sales period. However, if you dont foresee an obvious pickup in demand coming, the increase could mean that unsold goods will simply collecting dust in the stockroom. Days Sales Outstanding (DSO) This looks at the number of days needed to collect on sales and involves Accounts Receivables. While cash-only sales have a DSO of zero, people do use credit extended by the company, so this number is going to be positive. Again, smaller is better. Days Sales Outstanding (DSO) = Net Sales / 365 Average Accounts Receivable

If a company's collection period is growing longer, it could mean problems ahead. The company may be letting customers stretch their credit in order to recognize greater top-line sales and that can spell trouble later on especially if customers face a cash crunch. Getting money right away is preferable to waiting for it - especially since some of what is owed may never get paid. The quicker a company gets its customers to make payments, the sooner it has cash to pay for salaries, merchandise and equipment, loans and, best of all, dividends and growth opportunities. Days Payables Outstanding (DPO) This involves the company's payment of its own bills or Accounts Payables. If this can be maximized, the company holds onto cash longer, maximizing its investment potential; therefore, a longer DPO is better. Days Payable Outstanding (DPO) = Average Accounts Payable Cost of Goods sold (COGS) / 365

32

Key Ratios
The ratios can be divided into following categories according to financial activity or functions to be evaluated: Ratios related to Inventory Management Ratios related to Receivables Management Ratios related to Cash Management Profitability Ratios Ratios related to Inventory Management 1. Inventory Turnover Ratio 2. Inventory to Working Capital Ratio 3. Inventory to Current Assets Ratio 4. Inventory to Sales Ratio 1. Inventory Turnover Ratio The inventory turnover measures that how well the company can manage to sell its inventory. Another way of saying is how efficiently the company turns inventory into sales. The purpose is to ensure the blocking of only required minimum funds in inventory. Importance of Inventory Turnover If the company can quickly sell its inventory, the inventory turnover will be higher. Conversely, if the company cannot sell its inventory well, then the inventory turnover will be low. One has to watch this figure closely if the inventory ratio climbs too high, then the company may be keeping too little inventory. This could cause lost profits due to customer orders that had to wait until inventory arrived.
Inventory Turnover Ratio = Cost of Goods sold (COGS) Average Inventory

2. Inventory to Working Capital ratio The inventory to working capital ratio measures how well the company is able to generate cash using working capital at its current inventory level. This ratio shows the relationship between investments made in inventory & the total net investment in working capital. Inventory is an important part of working because of its direct impact

33 on the profits of the organization. The value of inventory is susceptible to changing price levels, fluctuation in business activities, variation in consumer demand, obsolescence & other unpredictable factors that determine the market conditions. Therefore, working capital should be sufficient to provide a cover for the possible losses in inventory value. Importance of Inventory to Working Capital An increasing Inventory to Working Capital ratio is generally a negative sign, showing the company may be having operational problems. If a company has too much Working Capital invested in Inventory, they may have difficulty having enough Working Capital to make payments on Short-Term Liabilities and Accounts Payable. This is a great ratio to be used with several others to really pick apart the inner workings of a company.
Inventory to Working Capital Ratio = Working Capital Inventory

X 100

3. Inventory to Current Assets Ratio Inventory is one of the largest components of the current assets. The position of inventory indicates operational efficiency of organization. The inventory to current assets ratio measures how much percentage of current assets is formed by the inventories. This ratio is essential as inventories are the most illiquid of all current assets as sometimes it becomes difficult to convert inventory ( raw materials, work-inprogress and finished products ) into cash on a short notice. Importance of inventory to current assets An increasing inventory to current assets ratio is a negative sign. It means that more & more percentage of current assets is being constituted by the inventories. This indicates poor operational efficiency of the organization. Also it shows that the funds invested in current assets to meet obligations on a short notice are actually illiquid to some extent & it may be difficult to convert them into cash immediately. On the other hand, if the position of inventory is lower in current assets, it indicates higher operational efficiency of the organization. Normally, less than 50 % of current assets are treated as average position of inventory.

34
Inventory Current Assets

Inventory to Current Assets Ratio

X 100

4. Inventory to Sales Ratio The Inventory to Sales ratio measures the percentage of inventory the company currently has on hand to support the current amount of sales. Importance of Inventory to Sales An increasing Inventory to Sales ratio is generally a negative sign, showing the company may be having trouble keeping inventory down and/or Net Sales have slowed, and can sometimes indicate larger financial problems the company may be facing. Viewing this ratio over several periods reveals the important aspect of the company's ability to manage inventory while attempting to increase sales. It is also important to compare this ratio among several companies to gauge how well each one performs, and to compare their ratios to industry averages.
Inventory to Sales Ratio = Inventory Sales

X 100

Ratios related to Receivable Management 1. Debtors turnover ratio 2. Average collection period 3. Debtors to current assets ratio 4. Debtors to working capital ratio 5. Debt to Equity Ratio 1. Debtors Turnover Ratio This ratio is also known as Accounts Receivable Turnover Ratio. Accounts Receivable is the amount that customers owe the company. The Accounts Receivable Turnover measures the number of times Accounts Receivables were collected during the year. This is also a measure of how well the company collects sales on credit from its customers, just as Average Collection Period measures this in days. Importance of Accounts Receivable Turnover A high or increasing Accounts Receivable Turnover is usually a positive sign showing the company is successfully executing its credit policies and quickly turning

35 its Accounts Receivables into cash. A possible negative aspect to an increasing Accounts Receivable Turnover is that the company may be too strict in its credit policies and missing out on potential sales.
Debtor Turnover Ratio = Net Sales Average Accounts Receivable

2. Average Collection Period The Average Collection Period measures the average number of days it takes for the company to collect revenue from its credit sales. The Average Daily Sales is the Net Sales divided by 365 days in the year. The company will usually state its credit policies in its financial statement, so the Average Collection Period can be easily gauged as to whether or not it is indicating positive or negative information. Importance of Average Collection Period This ratio reflects how easily the company can collect on its customers. It also can be used as a gauge of how loose or tight the company maintains its credit policies. A particular thing to watch out for is if the Average Collection Period is rising over time. This could be an indicator that the company's customers are in trouble, which could spell trouble ahead. This could also indicate the company has loosened its credit policies with customers, meaning that they may have been extending credit to companies where they normally would not have. This could temporarily boost sales, but could also result in an increase in sales revenue that cannot be recovered, as shown in the Allowance for Doubtful Accounts.
Average Collection Period 360 = Debtor Turnover Ratio

3. Debtors to Current Assets Ratio Debtor to current assets ratio indicates the position of debtors in total current assets. This ratio is calculated by debtors with current assets. Debtors are one of the largest components of current assets. If debtors are average or less than average, it indicates proper realization of debtors. On the other hand, if debtors are very heavy on respect of other current assets, it indicates poor recovery of the company.
Debtors to Current Assets Ratio = Debtors Current Assets

X 100

36

4. Debtors to Working Capital Ratio Debtor to working capital ratio is one of the important ratios for analysis of working capital management. Working capital is directly related with the position of debtors. If debtors are lower as compared to working capital, it indicates proper and smooth utilization of working capital. But on the other hand, the amount of debtor is very large in that condition, working capital blocked and operational efficiency is directly affected.
Debtors to Working Capital Ratio = Debtors Working Capital

X 100

5. Debt to Equity Ratio Debt to Equity ratio describes the lenders contribution for each rupee of the owners contribution. The ratio is directly computed by dividing total debt by equity or net worth.
Debt to Equity Ratio Debt = Equity

Importance of Debt to Equity Ratio The ratio shows the extent to which debt financing has been used in the business. A high ratio means that claims of creditors are greater than those of owners. A high level of debt introduces inflexibility in the firms operations due to the increasing interference and pressure from creditors. A low debt-equity ratio implies a greater claim of owners than capital. Ratios Related to Cash Management 1. Working capital ratio or current ratio 2. Liquid ratio or Acid-test ratio 3. Cash to current assets ratio 4. Sales to current assets ratio 5. Working capital turnover ratio 6. Sales to working capital ratio

37 1. Working Capital Ratio or Current Ratio The working capital ratio (or current ratio) attempts to measure the level of liquidity, that is, the level of safety provided by the excess of current assets over current liabilities. The current ratio compares all the Current Assets of a company to all the Current Liabilities. What this ratio basically tells us is if the company had to sell all its readily available assets, would it be able to pay off its immediate debt? Importance of Working capital ratio or current ratio At a minimum, you would hope the company whose financial performance you are analyzing could meet to pay its Current Liabilities if it were to liquidate all its Current Assets. This would translate to a Current Ratio of 1:1 - the point where the Current Assets equal the Current Liabilities. As with all the other performance ratios, the Current Ratio value depends on the industry in which the company is operating. It is also important to know what assets make up most of the Current Assets. Inventory and Accounts Receivable, which are part of the Current Assets, cannot always be counted on as easily transferred to cash. Cash and Marketable Securities comprising the majority of the Current Assets would definitely be favorable. Knowing this, would the company you are analyzing truly be able to meet its financial obligations is it in fact had to sell its Current Assets? The Current Ratio rising over time will be favorable.
Current Assets Current Ratio = Current Liabilities

2. Liquid Ratio or Acid-Test Ratio or Quick Ratio Liquid ratio is also known as Acid-test ratio or Quick ratio. Liquid ratio is a more vigorous test of liquidity than current ratio. The term liquidity refers to the ability of the firm to pay its short term obligations as & when they become due. Current assets include inventories and prepaid expenses, which are not easily converted into cash within a short span of time. So, quick ratio may be referred to as the relationship between quick assets i.e. (current assets inventories) & current liabilities. An asset is said to be liquid if it can be converted into cash within a short span of period without loss of value. Importance of Liquid Ratio If a company one is analyzing looks good while testing it against the Current Ratio, then the Quick Ratio should be your next test to apply. Companies with steadily

38 rising Inventories may look good with the Current Ratio, but will have a deteriorating effect on the Quick Ratio, since we subtract the Inventory out. The Quick Ratio rising over time is favorable.
Current Assets Inventories Quick Ratio = Current Liabilities

3. Cash to Current Assets Ratio This ratio basically measures what percentage of the current assets is formed by the cash component. This is a more stringent measure of liquidity as it considers the most liquid current asset. Importance of Cash to Current Assets Ratio High or increasing Cash to Current Assets ratio is generally a positive sign, showing the company's liquid assets represent a larger portion of its Total Current Assets. It also indicates the company may be better able to convert its non-liquid assets, such as inventory, into cash.
Cash to Current Asset Ratio = Cash Current Assets X 100

4. Sales to Current Assets Ratio The Sales to Current Assets ratio measures how well a company is making use of its assets in generating sales. This ratio is most valid in industries where companies hold the majority of their own inventories in-house, as opposed to having their customers hold their inventory for them. Importance of Sales to Current Assets The Sales to Current Assets ratio is best measured over several periods compared to industry averages, as the amount of Current Assets varies widely among companies and industries. Decreasing Sales to Current Assets ratio is generally a negative sign, indicating the company may have slowed production, decreasing the amount of inventory and resultantly the Current Assets.
Sales to Current Asset Ratio = Sales Current Assets

5. Working Capital Turnover Ratio The Working Capital Turnover ratio measures the company's Net Sales from the Working Capital generated. Note that another ratio exists, the Sales to Working

39 Capital Ratio also measures Net Sales to Working Capital. We chose to interchange the usual components of Working Capital (Total Current Assets - Total Current Liabilities) with an alternate method (shown above). With two similar ratios using slightly different methods to compute Working Capital, plotting both of these ratios together to see their differences would be wise. Importance of Working Capital Turnover A high or increasing Working Capital Turnover is usually a positive sign, showing the company is better able to generate sales from its Working Capital. Either the company has been able to gain more Net Sales with the same or smaller amount of Working Capital, or it has been able to reduce its Working Capital while being able to maintain its sales. Efforts to streamline the operations of the company will often show favorably in this ratio.

Working Capital Turnover Ratio

Sales = Average Working Capital

6. Sales to Working Capital Ratio The Sales to Working Capital ratio measures how well the company's cash is being used to generate sales. Working Capital represents the major items typically closely tied to sales, and each item will directly affect this ratio. Importance of Sales to Working Capital An increasing Sale to Working Capital ratio is usually a positive sign, indicating the company is more able to use its working capital to generate sales. Although measuring the performance of a company for just one period reveals how well it is using its cash for that single period, this ratio is much more effectively used over a number of periods. This ratio can help uncover questionable management decisions such as relaxing credit requirements to potential customers to increase sales, increasing inventory levels to reduce order fulfillment cycle times, and slowing payment to vendors and suppliers in an effort to hold on to its cash.
Working Capital Turnover Ratio = Sales Average Working Capital

Profitability Ratios 1. Return on Assets (ROA)

40 2. Return on Equity (ROE) 3. Return on Capital Employed (ROCE) 4. Net Profit Margin 1. Return on Assets (ROA) ROA is an indicator of how profitable a company is relative to its total assets. ROA tells how efficient management is at using its assets to generate earnings. The ROA figure gives investors an idea of how effectively the company is converting the money it has to invest into net income. The higher the ROA number, the better, because the company is earning more money on less investment.
Return on Assets (ROA) = Profit After Tax Average Total Assets

2. Return on Equity (ROE) The return on equity is net profit after taxes divided by average equity. It measures the rate of return on the ownership interest of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity. ROE shows how well a company uses investment funds to generate earnings growth.
Return on Equity (ROE) = Profit After Tax Average Equity

3. Return on Capital Employed (ROCE) ROCE is used to prove the value the business gains from its assets and liabilities, a business which owns lots of land but has little profit will have a smaller ROCE to a business which owns little land but makes the same profit. It basically can be used to show how much a business is gaining for its assets, or how much it is losing for its liabilities.
Return on Capital Employed (ROCE) = Profit Before Tax Average Capital Employed

4. Net Profit Margin Net Profit Margin ratio is measured by dividing profit after tax by sales:

41
Net Profit Margin Profit After Tax Sales

Importance of Net Profit Margin Net profit margin ratio establishes a relationship between net profit and sales and indicates managements efficiency in manufacturing, administering and selling the products. This ratio is the overall measure of the firms ability to turn each rupee sales into net profit.

DATA ANALYSIS OPERATING CYCLES

Ratios related to Inventory Management
1. Inventory Turnover Ratio Inventory Turnover Ratio = Cost of Goods sold (COGS) Average Inventory (in Rs. Crores) Year 2008-09 2009-10 2010-11 2011-12 2012-13 COGS 6809.48 9166.48 9578.09 11336.77 31496.75 Average Inventory 976.03 1225.57 1901.79 1930.52 1654.23 Inventory Turnover Ratio 6.977 7.479 5.036 5.872 19.040

35000 30000 25000 20000 15000 10000 5000 0 2004-05 2008-09 2005-06 2009-10 2006-07 2010-11 2007-08 2011-12 6.977 7.479 5.036 5.872

19.040

20.000 15.000 10.000 5.000 0.000

2008-09 2012-13

COGS

Average Inventory

Inventory Turnover Ratio

42

Analysis
The inventory turnover ratio at IFFCO is 19.040 in 2012-13. It means that that the company is turning its inventory of finished goods into sales 19.040 times in a year and is in good position. There had been a decrease in the inventory turnover ratio from 7.479 in 201210 to 5.036 in 2010-11. During this period, there was a large amount of inventory in the company because of the purchase of the Paradeep production plant. During all other period, the turnover is always increasing. 2. Inventory to Working Capital Ratio Inventory to Working Capital Ratio Inventory Working Capital

X 100

Year

Inventory (in Crores) 931.50 1519.64 2283.94 1577.10 1731.36

Working Capital (in Crores) 1499.14 3387.39 4880.05 4404.17 4490.10

Inventory to Working Capital Ratio 62.136 44.862 46.802 35.809 38.559

70.000

2008-09 2009-10 2010-11 2011-12 2012-13

6000 5000 4000 3000 2000 1000 0 62.136

60.000 44.862 46.802 35.809 50.000 38.559 40.000 30.000 20.000 10.000

2004-05

2008-09
Inventory

2009-10
2005-06

2010-11
2006-07

2011-12
2007-08

2012-13
2008-09

0.000

(in Crores)

Working Capital (in crores)

Inventory to Working Capital Ratio

Analysis
The Inventory to Working Capital Ratio measures how well the company is able to generate cash using working capital at its current inventory level. An increasing inventory to

43 working capital ratio is generally a negative sign, showing the company may be having operational problems. If a company has too much working capital invested in inventory, they may have difficulty having enough working capital to make payments on short term liabilities and accounts payable. Inventory to working capital ratio for IFFCO has been decreasing consistently with increasing very marginally in the year 2011-12 and in 2012-13. 3. Inventory to Current Assets Ratio Inventory to Current Assets Ratio = Inventory Current Assets X 100

Year 2008-09 2009-10 2010-11 2011-12 2012-13

9000 8000 7000 6000 5000 4000 3000 2000 1000 0 2004-05 35.772

Inventory (in Crores) 931.50 1519.64 2283.94 1577.10 1731.36

Current Assets (in Crores) 2603.98 4748.98 6081.28 5775.74 7672.99

Inventory to Current Assets Ratio 35.772 31.999 37.557 27.306 22.564

40.000 35.000 30.000 22.564 25.000 20.000 15.000 10.000 5.000 0.000

37.557 31.999 27.306

2008-09
Inventory

2009-10
2005-06

2010-11
2006-07

2011-12
2007-08

2012-13

2008-09

(in Crores)

Current Assets (in crores)

Inventory to Current Assets Ratio

Analysis
The Inventory to Current Assets Ratio measures that how much percentage of current assets is formed by the inventories. An increasing inventory to current assets ratio is a negative sign. It means that more & more percentage of current assets is being constituted by

44 the inventories. This indicates poor operational efficiency of the organization. Also it shows that the funds invested in current assets to meet obligations on a short notice are actually illiquid to some extent and it may be difficult to convert them into cash immediately. Normally, less than 50 % of current assets are treated as average position of inventory. IFFCO has shown a decrease in this ratio over the past years, which indicates a GOOD inventory position for IFFCO and, the ratio was never been above 38%. 4. Inventory to Sales Ratio Inventory to Sales Ratio = Inventory Sales X 100

Year 2008-09 2009-10 2010-11 2011-12 2012-13

35000 30000 25000 20000 12.593 15000 10000 5000 0

Inventory (in Crores) 931.50 1519.64 2283.94 1577.10 1731.36

Sales (in Crores) 7396.87 9942.93 10330.11 12162.82 32933.30

Inventory to Sales Ratio 12.593 15.284 22.110 12.967 5.257

25.000

22.110 20.000 15.284 12.967 10.000 5.257 5.000 0.000 15.000

2004-05

2008-09

2009-10
2005-06

2010-11
2006-07

2011-12
2007-08

2012-13
2008-09

Inventory

(in Crores)

Sales

(in crores)

Inventory to Sales Ratio

Analysis
The Inventory to Sales Ratio measures the percentage of inventory the company currently has on hand to support the current amount of sales. An increasing Inventory to Sales ratio is generally a negative sign, showing the company may be having trouble keeping inventory down and/or Net Sales have slowed, and can sometimes indicate larger financial problems the company may be facing.

45 As per the data of IFFCO, this ratio had increased initially till the year 2010-11but is falling down consistently after that time, which is a POSITIVE sign indicating good movement of inventory.

RATIOS RELATED TO RECEIVABLE MANAGEMENT

1. Debtors turnover ratio Debtor Turnover Ratio = Net Sales Average Accounts Receivable

Year 2008-09 2009-10 2010-11 2011-12 2012-13

35000 30000 25000 20000 15000 10000 5000 0 18.631

Net Sales (in Crores) 7396.87 9942.93 10330.11 12162.82 32933.30

Avg. A/c Receivables (in Crores) 397.03 399.50 418.04 387.72 410.50

Debtor Turnover Ratio 18.631 24.888 24.711 31.370 80.227

90.000 80.227 80.000 70.000 60.000 50.000 40.000

24.888

31.370 24.711

30.000 20.000 10.000 0.000

2004-05

2008-09 Net Sales

2009-10
2005-06

2010-11

2006-07

2011-12

2007-08

2012-13

2008-09

(in Crores)

Avg. A/c Receivables (in crores)

Debtor Turnover Ratio

Analysis
This ratio is also known as Accounts Receivable Turnover Ratio and measures the number of times Accounts Receivables were collected during the year. This is also a measure of how well the company collects sales on credit from its customers.

46 IFFCO have a high and increasing Accounts Receivable Turnover which is a Positive Sign. The company is able to turnover its debtors 80.227 times in a year. 2. Average collection period Average Collection Period 360 Debtor Turnover Ratio Debtor Turnover Ratio 18.631 24.888 24.711 31.370 80.227 Average Collection Period 19.323 14.465 14.569 11.476 4.487
25.000 19.323 14.465 14.569 11.476 20.000 15.000 10.000 4.487 5.000 0.000

Year 2008-09 2009-10 2010-11 2011-12 2012-13

35000 30000 25000 20000 15000 10000 5000 0

Sales (in Crores) 7396.87 9942.93 10330.11 12162.82 32933.30

Average Debtors (in Crores) 397.03 399.50 418.04 387.72 410.50

2008-09 2004-05 Sales

2009-10 2005-06 (in Crores)

2010-11 2006-07

2011-12 2007-08 Average Debtors

2012-13 2008-09 (in crores)

Average Collection Period

Analysis
The Average Collection Period represents the average number of days for which a firm takes to collect accounts receivables. It measures the quantity of debtors. The Average Collection Period for IFFCO was around 4.5 days in 2012-13. This is extremely good considering the fact that IFFCO is a fertilizer company, and functions as a cooperative. The maximum collection period during this five year period is around 17 days in the year 2009-10 and is decreasing since then.

47 3. Debtors to current assets ratio Debtors to Current Assets Ratio = Debtors Current Assets X 100

Year 2008-09 2009-10 2010-11 2011-12 2012-13

9000 8000 7000 6000 5000 4000 3000 2000 1000 0 12.465

Debtors (in Crores) 324.59 474.40 361.68 413.76 407.23

Current Assets (in Crores) 2603.98 4748.98 6081.28 5775.74 7672.99

Debtors to Current Assets Ratio 12.465 9.990 5.947 7.164 5.307

14.000 12.000

9.990 7.164 5.947 5.307

10.000 8.000 6.000 4.000 2.000

2008-09 2004-05
Debtors

2009-10 2005-06
(in Crores)

2010-11 2006-07

2011-12 2007-08

2012-13 2008-09

0.000

Current Assets (in crores)

Debtors to Current Assets Ratio

Analysis
Debtors to Current Assets Ratio indicates the position of debtors in total current assets. This ratio is calculated by debtors with current assets. If debtors are average or less than average, it indicates proper realization of debtors. On the other hand, if debtors are very heavy in respect of other current assets, it indicates poor recovery of the company. As Per the table, the Debtors to Current Assets Ratio for IFFCO decreased from 2008-09 to 2009-10 and then increased in the year 2011-12 and then decreasing onwards. The decrease is a healthy sign showing proper realization of debts in 2012-13.

48 4. Debtors to working capital ratio Debtors to Working Capital Ratio = Debtors Working Capital X 100

Year 2008-09 2009-10 2010-11 2011-12 2012-13

6000 5000 4000 3000 2000 1000 0 21.652

Debtors (in Crores) 324.59 474.40 361.68 413.76 407.23

Working Capital (in Crores) 1499.14 3387.39 4880.05 4404.17 4490.10

Debtors to Working Capital Ratio 21.652 14.005 7.411 9.395 9.070

25.000 20.000

14.005 9.395 7.411 9.070

15.000 10.000 5.000 0.000

2008-09 2004-05
Debtors

2009-10 2005-06
(in Crores)

2010-11 2006-07

2011-12 2007-08

2012-13 2008-09

Working Capital (in crores)

Debtors to Working Capital Ratio

Analysis
Working capital is directly related with the position of debtors. If debtors are lower as compared to Working Capital, then it indicates proper and smooth utilization of working capital. But on the other hand, the amount of debtor is very large in that condition, Working capital blocked and operational efficiency is directly affected. From the data, it can be seen that this ratio for IFFCO has been decreasing which is good for the company. There was a increment in the year 2011-12 due to increase in the debtors but again it continued to decrease.

49 5. Debt to Equity Ratio Debt to Equity Ratio = Debt Total Equity Equity (in Crores) 3301.15 3555.38 3641.84 3688.66 3958.87

Year 2008-09 2009-10 2010-11 2011-12 2012-13

14000 12000 10000 8000

Debt (in Crores) 647.09 5035.39 6486.12 6775.64 12802.78

Debt to Equity Ratio 0.196 1.416 1.781 1.837 3.234

3.500 3.234 3.000 2.500

1.781 6000 4000 2000 0 0.196 2004-05 1.416

1.837

2.000 1.500 1.000 0.500

2008-09

2009-10
2005-06

2010-11
2006-07

2011-12

2007-08

2012-13

0.000

2008-09

Debt

(in Crores)

Equity

(in crores)

Debt to Equity Ratio

Analysis
The ratio shows the extent to which debt financing has been used in the business. A high ratio means that claims of creditors are greater than those of owners. A high level of debt introduces inflexibility in the firms operations due to the increasing interference and pressure from creditors. A low debt-equity ratio implies a greater claim of owners than capital. At IFFCO, this ratio is increasing every year. It means that increase in debt of the company is more than the increase in the equity. In the year 2012-13, it increased to 3.234 from 1.837 in the year 2011-12 because of the major increase in the short term loans from the banks.

50

RATIOS RELATED TO CASH MANAGEMENT

1. Working capital ratio or current ratio Current Ratio = Current Assets Current Liabilities

Year 2008-09 2009-10 2010-11 2011-12 2012-13

9000 8000 7000 6000 5000 4000 3000 2000 1000 0 2004-05 2.357

Current Assets (in Crores) 2603.98 4748.98 6081.28 5775.74 7672.99

Current Liabilities (in Crores) 1104.84 1361.58 1201.23 1371.57 3182.89

Current Ratio 2.357 3.488 5.063 4.211 2.411

6.000

5.063 4.211 3.488

5.000 4.000 3.000 2.411 2.000 1.000

2008-09

2009-10
2005-06

2010-11 (in Crores)

2006-07

2011-12
2007-08

2012-13
2008-09

0.000

Current Assets Current Ratio

Current Liabilities (in crores)

Analysis
Working Capital Ratio is used to analyze the short term solvency of the company. Usually a ratio of 2:1 is considered to be the best current ratio. Higher the ratio, greater is the ability of the firm to meet its short term obligations. Current Ratio at IFFCO is always greater than 2 in all five years for which data has been analyzed indicating that IFFCO never really face a major problem in meeting its short-term liabilities.

51 2. Liquid ratio or Acid-test ratio or Quick ratio Quick Ratio = Current Assets - Inventories Current Liabilities

Year 2008-09 2009-10 2010-11 2011-12 2012-13

7000 6000 5000 4000 3000 2000 1000 0

Current Assets (in Crores) 2603.98 4748.98 6081.28 5775.74 7672.99

Inventories (in Crores) 931.50 1519.64 2283.94 1577.10 1731.36

Quick Assets (in Crores) 1672.48 3229.34 3797.34 4198.64 5941.63

Current Liabilities (in Crores) 1104.84 1361.58 1201.23 1371.57 3182.89

Quick Ratio 1.514 2.372 3.161 3.061 1.867

3.500

3.161

3.061

3.000 2.500 1.867 2.000 1.500 1.000 0.500

2.372

1.514

2004-05

2008-09

2005-06

2009-10

2010-11
2006-07

2011-12
2007-08

2012-13
2008-09

0.000

Quick Assets (in Crores)

Current Liabilities (in crores)

Quick Ratio

Analysis
Position of Liquid ratio is very good. The Quick Ratio of 1:1 is considered to be satisfactory. This is so because if the quick assets are equal to the current liabilities then the company may be able to meet its entire short-term obligations pretty conveniently. The quick ratio of the company is above 1 for all the five years. The quick ratio was 3.161 and 3.061 during the year 2010-11and 2011-12 respectively. This is due to large amount of inventory at IFFCO during that period. However, the reason for this is the purchase of Paradeep production plant during that period.

52 3. Cash to current assets ratio Cash to Current Asset Ratio Cash = Current Assets X 100

Year

Cash (in Crores) 199.10 98.22 330.84 243.32 69.63

Current Assets (in Crores) 2603.98 4748.98 6081.28 5775.74 7672.99

Cash to Current Asset Ratio (%) 7.646 2.068 5.440 4.213 0.907

2008-09 2009-10 2010-11 2011-12 2012-13

9000 8000 7000 6000 5000 4000 3000 2000 1000 0 2004-05 2.068 0.907 7.646 5.440 4.213

9.000 8.000 7.000 6.000 5.000 4.000 3.000 2.000 1.000 0.000

2008-09
Cash

2005-06

2009-10
(in Crores)

2010-11
2006-07

2011-12
2007-08

2008-09

2012-13

Current Assets (in crores)

Cash to Current Asset Ratio

Analysis
The Cash to Current Assets Ratio indicates what percentage of current assets is comprised of cash at hand and cash at bank. Upon analyzing the data of the past 5 years for IFFCO it was observed that the cash balances formed only a very small percentage of the current assets. In the last 5 years, the highest was 7.65% in the year 2008-09 after which it is decreasing. The ratio had variations in this period an in the year 2012-13, it was 0.91%. This is a POSITIVE SIGN as it shows effective utilization of the funds of the organization and there is not much of idle cash with the organization.

53 4. Sales to current assets ratio

Sales to Current Asset Ratio = Sales Current Assets

Year 2008-09 2009-10 2010-11 2011-12 2012-13

35000 30000 25000 20000 15000 10000 5000 0 2.841

Sales (in Crores) 7396.87 9942.93 10330.11 12162.82 32933.30

Current Assets (in Crores) 2603.98 4748.98 6081.28 5775.74 7672.99

Sales to Current Asset Ratio 2.841 2.094 1.699 2.106 4.292

5.000 4.500 4.000 3.500 3.000 2.500 2.000 1.500 1.000 0.500 0.000

4.292

2.094 1.699

2.106

2008-09 2004-05
Sales

2009-10 2005-06
(in Crores)

2010-11 2006-07

2011-12 2007-08

2012-13 2008-09

Current Assets (in crores)

Sales to Current Asset Ratio

Analysis
The Sales to Current Assets Ratio basically measures how well a company is making use of its assets in generating sales. An increasing sale to current assets ratio is a POSITIVE SIGN as it indicates that the company has a healthy production scenario because of which most of inventory is being converted into sales for the company. IFFCO has shown a decrease in its sales to current assets ratio from 2009-10 to 2011-12 after which it is constantly increasing which implies that the company is doing well and inventory is not being held up at any stage in the production process.

54 5. Working capital turnover ratio Working Capital = Current Assets - Current Liabilities Working Capital Turnover Ratio Sales = Average Working Capital

Year 2008-09 2009-10 2010-11 2011-12 2012-13

35000 30000 25000 20000 15000 10000 5000 0 4.680

Sales (in Crores) 7396.87 9942.93 10330.11 12162.82 32933.30

Working Capital (in Crores) 1580.36 2443.27 4133.72 4642.11 4447.14

Working Capital Turnover Ratio 4.680 4.070 2.499 2.620 7.406

8.000 7.406 7.000 6.000 5.000

4.070 2.499 2.620

4.000 3.000 2.000 1.000 0.000

2008-09 2004-05

2009-10 2005-06

2010-11 2006-07

2011-12 2007-08

2012-13 2008-09

Sales

(in Crores)

Working Capital (in crores)

Working Capital Turnover Ratio

Analysis
IFFCO has a high working capital turnover ratio. A high or increasing Working Capital Turnover is usually a Positive Sign, showing the company is better able to generate sales from its Working Capital. The company has been able to gain more Net Sales with the smaller amount of Working Capital in 2012-13 as compared to that in 2011-12. The working capital turnover had been decreasing from 4.860 in the year 2008-09 to 2.499 in 2010-11 but it increasing since then to 7.406 in the year 201213.

55 6. Sales to working capital ratio Working Capital = Current Assets - Current Liabilities Sales to Working Capital Ratio Sales = Average Working Capital

Year 2008-09 2009-10 2010-11 2011-12 2012-13

35000 30000 25000 20000 15000 10000 5000 0 2004-05 2008-09 4.680

Sales (in Crores) 7396.87 9942.93 10330.11 12162.82 32933.30

Working Capital (in Crores) 1580.36 2443.27 4133.72 4642.11 4447.14

Sales to Working Capital Ratio 4.680 4.070 2.499 2.620 7.406

7.406 8.000 7.000 6.000 5.000

4.070 2.499 2.620

4.000 3.000 2.000 1.000 0.000

2005-06 2009-10

2006-07 2010-11

2007-08 2011-12

2008-09 2012-13

Sales

(in Crores)

Working Capital (in crores)

Sales to Working Capital Ratio

Analysis
The Sales to Working Capital ratio measures how well the company's working capital is being used to generate sales. Working Capital represents the major items typically closely tied to sales, and each item will directly affect this ratio. Increasing Sales to Working Capital ratio is usually a positive sign, indicating the company is more able to use its working capital to generate sales. The sales to working capital ratio has been increasing from 2011-12 for IFFCO which is good as it implies that the company is generating more & more sales and is able to utilize its working capital more efficiently with the passing years. The decrease of the ratio in the previous
years was due to the increase in inventory holding which was required for the Paradeep production plant.

56

PROFITABILITY RATIOS
1. Return on Assets Return on Assets (ROA) Profit After Tax Average Total Assets

Year 2008-09 2009-10 2010-11 2011-12 2012-13

Profit After Tax (in Crores) 319.64 341.35 175.02 257.59 360.01

Average Total Assets (in crores) 4449.22 6709.33 9855.58 10830.24 14151.13

ROA 0.072 0.051 0.018 0.024 0.025

16000 14000 12000 10000 8000 6000 4000 2000 0 2004-05 0.024 0.018 0.025 0.051 0.072

0.080 0.070 0.060 0.050 0.040 0.030 0.020 0.010 0.000

2008-09

2009-10 2005-06

2010-11 2006-07

2011-12 2007-08 Average Total Assets

2012-13 2008-09 (in crores)

Profit After Tax ROA

(in Crores)

Analysis
ROA is an indicator of how profitable a company is relative to its total assets. The ROA figure gives investors an idea of how effectively the company is converting the money it has to invest into net income. The higher the ROA number, the better, because the company is earning more money on less investment. At IFFCO, the ROA is increasing from the year 2010-11 which is good for the company. Earlier it was decreasing as there was increase in the assets due to purchase of the production plants.

57 2. Return on Equity Return on Equity (ROE) = Profit After Tax Average Equity

Year 2008-09 2009-10 2010-11 2011-12 2012-13

Profit After Tax (in Crores) 319.64 341.35 175.02 257.59 360.01

Average Equity (in crores) 3205.37 3428.27 3598.61 3665.25 3823.77

ROE 0.100 0.100 0.049 0.070 0.094

4500 4000 3500 3000 2500 2000 1500 1000 500 0 2004-05 0.049 0.070 0.100 0.100 0.094

0.120 0.100 0.080 0.060 0.040 0.020

2008-09

2009-10
2005-06

2010-11
2006-07

2011-12
2007-08

2012-13
2008-09

0.000

Profit After Tax

(in Crores)

Average Equity

(in crores)

ROE

Analysis
Return on Equity measures the rate of return on the ownership interest of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity. ROE shows how well a company uses investment funds to generate earnings growth. From the data, IFFCO ROE had always been good. There was a decrease in the year 2010-11due to the purchase of Paradeep plant which increased the purchases of the organization.

58 3. Return on Capital Employed Return on Capital Employed (ROCE) Profit Before Tax = Average Capital Employed

Year 2008-09 2009-10 2010-11 2011-12 2012-13

Profit Before Tax (in Crores) 470.92 481.90 251.25 380.52 441.95

Average Capital Employed (in crores) 4449.22 6709.33 9855.58 10830.24 14151.13

ROCE 0.1058 0.0718 0.0255 0.0351 0.0312

16000 14000 12000 10000 8000 6000 4000 2000 0

0.1200 0.1058 0.0718 0.1000 0.0800 0.0600 0.0255 0.0351 0.0312 0.0400 0.0200 0.0000

2008-09 2004-05

2009-10 2005-06

2010-11 2006-07

2011-12 2007-08 (in Crores) (in crores)

2012-13 2008-09

Profit Before Tax ROCE

Average Capital Employed

Analysis
ROCE is used to prove the value the business gains from its assets and liabilities. It basically can be used to show how much a business is gaining for its assets, or how much it is losing for its liabilities. At IFFCO, ROCE had shown variable changes. This is due to the variable increments in the capital employed (majorly the loan funds) as compared to the profit before tax.

59 4. Net Profit Margin Net Profit Margin = Profit After Tax Sales

Year 2008-09 2009-10 2010-11 2011-12 2012-13

35000 30000 25000 20000 15000 10000 5000 0 2004-05 0.043

Profit After Tax (in Crores) 319.64 341.35 175.02 257.59 360.01

Sales (in Crores) 7396.87 9942.93 10330.11 12162.82 32933.30

Net Profit Margin 0.043 0.034 0.017 0.021 0.011

0.050 0.045 0.040 0.035 0.030 0.025 0.020 0.015 0.010 0.005 0.000

0.034

0.021 0.017 0.011

2005-06

2006-07

2007-08

2008-09

2008-09 2009-10 2010-11 2011-12 2012-13 Profit After Tax (in Crores) Sales (in crores)

Net Profit Margin

Analysis
Net profit margin ratio establishes a relationship between net profit and sales and indicates managements efficiency in manufacturing, administering and selling the products. This ratio is the overall measure of the firms ability to turn each rupee sales into net profit. From the data, IFFCO have a variable net profit margin. The sales turnover depend upon the element of subsidy which is decided by the government from time - to - time depending on the condition of international market. During the year 2012-13, the component of subsidy increased tremendously due to high international fertilizer price. Looking at the turnover of 2012-13, the subsidy amounted to Rs. 25545.60 crores vis--vis to subsidy amounted to Rs. 6194.35 crores for the year 2011-12.

60

LOANS AND ADVANCES TO CURRENT ASSETS

Loans and Advances to Current Assets Ratio = Loans and Advances Current Assets X 100

Year 2008-09 2009-10 2010-11 2011-12 2012-13

Loans and Advances (in Crores) 1148.77 2656.70 3104.82 3541.56 5464.77

Current Assets (in Crores) 2603.98 4748.98 6081.28 5775.74 7672.99

Loans and Advances to Current Assets Ratio 44.116 55.943 51.055 61.318 71.221

9000 8000 7000 6000 5000 4000 3000 2000 1000 0

80.000 71.221 70.000 55.943 44.116 61.318 51.055 60.000 50.000 40.000 30.000 20.000 10.000 0.000

2008-09 2004-05

2009-10 2005-06

2010-11 2006-07

2011-12 2007-08
(in Crores)

2012-13 2008-09

Loans and Advances

Current Assets (in crores) Loans and Advances to Current Assets Ratio

Analysis
As per the data, it can be clearly said that the position of the Loans & Advances with respect to current assets is increasing every year (a marginal decrease in the year 2010-11) which is very Good for IFFCO. The ratio was around 44.116% in 2011-12 which had increased to 71.221% in 2012-13.

61

LOANS AND ADVANCES TO WORKING CAPITAL

Loans and Advances to Working Capital Ratio = Loans and Advances Working Capital X 100

Year 2008-09 2009-10 2010-11 2011-12 2012-13

Loans and Advances (in Crores) 1148.77 2656.70 3104.82 3541.56 5464.77

Working Capital (in Crores) 1499.14 3387.39 4880.05 4404.17 4490.10

Loans and Advances to Working Capital Ratio (%) 76.629 78.429 63.623 80.414 121.707

6000 5000 4000 3000 2000 1000 0 2004-05 76.629 78.429 63.623 80.414

140.000 121.707 120.000 100.000 80.000 60.000 40.000 20.000 0.000

2008-09

2009-10
2005-06

2010-11
2006-07

2011-12
2007-08

2012-13
2008-09

Loans and Advances

(in Crores)

Working Capital (in crores) Loans and Advances to Working Capital Ratio

Analysis
This ratio shows how significant Loans & Advances Are to Working Capital and that Loans & Advances plays an important role in working capital management of IFFCO. This ratio shows that the company has more cash in hand and can utilize these funds as per the company requirement. At IFFCO, this ratio has always been increasing which is good for the organization. This means that company is having enough cash and utilizing it effectively.

62 Working Capital Position Working Capital = Current Assets - Current Liabilities

Year 2008-09 2009-10 2010-11 2011-12 2012-13

9000 8000 7000 6000 5000 4000 3000 2000 1000 0 2004-05 1499.14

Current Assets (in Crores) 2603.98 4748.98 6081.28 5775.74 7672.99

Current Liabilities (in Crores) 1104.84 1361.58 1201.23 1371.57 3182.89

Working Capital (in Crores) 1499.14 3387.40 4880.05 4404.17 4490.10

6000.00

4880.05 4404.17 3387.40

5000.00 4490.10 4000.00 3000.00 2000.00 1000.00

2008-09

2009-10
2005-06

2010-11
2006-07

2011-12
2007-08

2012-13

0.00

2008-09

Current Assets Working Capital

(in Crores) (in Crores)

Current Liabilities (in crores)

Analysis
Working Capital Position indicates changes in Current Assets and Current Liabilities over the study period and also during a particular year. Working capital position shows operational efficiency & proper utilization of short term resources in an organization. The trend of working capital with respect to Current Assets and Current Liabilities for IFFCO is increasing. This shows a GOOD GROWTH of the company. The Working Capital is managed properly & efficiently by the organization. However, there was decrease in the year 2011-12 due to decrease in the level of inventory.

63

COMPARISON WITH SOME COMPETITORS IN THE INDUSTRY

IFFCO

Coromandel National International Fertilizers

Fertilizers and Chambal Chemicals Fertilizers Travancore 647.94 706.89 42.95 412.60 823.53 392.21 431.32 1457.77 0.610 0.957 2.10 1.97 0.501 0.584 0.061 1234.35 4595.53 230.56 316.82 1566.28 1288.58 277.70 3982.04 0.060 1.141 1.22 9.63 0.202 0.069 0.050

Net Worth Sales Turnover Net Profit Inventory Total Current Assets Total Current Liability Working Capital Total Assets Working Capital to Sales Turnover Inventory to Working Capital Working Capital Ratio Working Capital Turnover Inventory to Current Assets Inventory to Sales Net Profit Margin

3958.87

1127.14

1470.70 5127.10 97.46 348.68 1525.51 886.65 638.86 1851.19 0.125 0.546 1.72 7.06 0.229 0.068 0.019

32933.30 9374.98 360.01 1731.36 7672.99 3182.89 4490.10 496.38 1347.51 3726.38 1755.02 1971.36

17303.77 2926.50 0.136 0.386 2.41 7.41 0.226 0.053 0.011 0.210 0.684 2.12 6.21 0.362 0.144 0.053

64

FINDINGS
After the analysis of the components of current assets & current liabilities and the trends of working capital, we find that Current assets are increasing more than current liabilities. But the current ratio has decreased as the percentage increase in current liabilities is more than the current assets. Cash and Bank Balances have decreased during this period which indicates proper utilization of funds at IFFCO. Position of inventory is Very Good in current assets (22.564%). Inventory Turnover Ratio increases consistently, which shows greater degree of utilization of inventory during the study period. Position of Debtors to Current Assets is 5.307%. This ratio had decreased during this period with an increase in the year 2011-12. This increase was due to the significant increase in the debts of the company.
Loans and Advances are increasing every year and contribute majorly to current

assets. This means that the company is not facing any problem to get the required short term financing. Large part of working capital is involved in maintaining inventory and it depends on the level of inventory every year. Working capital of the company had increased till 2010-11after which it has remain constant with small changes.
Debt to equity ratio increased during the year 2012-13 as the debt increased due to

increase in short term borrowings. Inventory as a component of current assets was high during the beginning of the period after which it has continuously decreasing.
Net profit margin decreased in the year 2012-13 because of the significant increase in

the raw material prices and consequent increase in subsidy. Looking on the trends, IFFCO has been able to manage the profits.
The major variation in the ratios during this period is due to the purchase of Paradeep

production plant.

65

CONCLUSIONS AND SUGGESTIONS

Working capital is one of the most important aspects of operational efficiency of business. Working Capital plays a very important role in the functioning of any organization. Both the current assets and current liabilities are very much influencing factors on the working capital of an organization.

After the discussion and analysis of the financial position of IFFCO Ltd., it is clear that the working capital of IFFCO is in sound position. Working capital is not measurable by only current assets & current liabilities but there are some other factors also that have an influence on the working capital.

In current assets, there are two most important factors, Debtors and Inventory that affect working capital. In IFFCO Ltd., Inventory and Debtors are efficiently managed to strengthen the position of the organization both in short term and long terms.

After analyzing and interpreting the financial data of INDIAN FARMERS FERTILIZER COOPERATIVE LIMITED (IFFCO) with the help of Ratio Analysis, the following suggestions were given to the organization for further betterment & improvement in the working capital: The present status and levels of current assets is extremely good and therefore it requires proper maintenance. The current percentage of inventory is high which is not good for operational efficiency and sound working capital and thus, it need to be controlled by using various inventory management techniques such as JIT or Kanban. Another alternative would be to have varying stock or inventory levels during the different seasons or even months and, thereby, altering the production to suit such needs. Cash balances have a lower percentage in current assets. This requires some concern as cash and bank balances are the most liquid of all current assets. As the sales turnover majorly consists of subsidiary, the company shall also depend less on subsidy which is dependent on the annual budget fixed by the government of India, i.e., when the total outflow of any financial year is more than the budgeted

66 subsidiary, the manufacturers/ importers have to wait for additional budget or their subsidiary get realized in the next financial year. As the Government of India wants the fertilizers to be supplied at minimum price, they are compensating manufacturers/ importers by means of subsidy. The government should device a method whereby the price of fertilizers should increase every year to some extent. This will reduce the subsidy burden on the government and companies will be able to realize cash against their sales.

67

CONCLUSION
The organization IFFCO is basically a Farmers Organization. It functions in the cooperative sector of India and is owned by the Government of India along with the cooperative societies. IFFCO is one of the most profitable and financially secure fertilizer companies in India. The generation of funds through sale is a seasonal factor. 70% of Sales activity in the business of fertilizers is in Monsoons and the balance 30% is spread throughout the rest of the year. The month from April to September is known as Kharif Season and from October to March is known as Rabi Season. Thus, it becomes imperative for the organization to have such cash management system in place that would enable the organization to plan the excess cash obtained during surplus periods and ploughs them back into the operations of the organization during deficit periods. The Cash Management System at IFFCO is very sound and efficient. It has enabled the organization to manage its funds in a proper manner resulting in better utilization and availability of funds in cash deficit periods. Today IFFCO has a tie up with banks such as IOB, HSBC Bank, ICICI Bank that are providing IFFCO with facilities such as cash management services, personalized financial MIS to enable IFFCO to accelerate the collection and payment of funds, debit sweep option, Anywhere banking facility, etc. All these facilities have helped IFFCO in having faster, more secure and more reliable collection and payments of funds and cheques from its various Area/State Offices. However, despite all the advantages of this New Cash Management System such as receiving the proceeds from the sale of fertilizers within First day of sale, reduction in the amount of interest loss suffered by IFFCO due to late arrival of payments, daily report of deposits made at various locations, location wise report, credit forecast report, monthly cumulative report date wise/ location wise, monthly charging statement, monthly cheque return statement, customized reports as per mutual agreement etc. the cash management system can be further improved.

68

References Books
Brealey, R A, Myers, S C, Alan, F and Mohanty, P 2008. Principles of Corporate Finance. Tata McGraw-Hill Publications, New Delhi, 8th SIE Edition.

Chandra, T K, Seti, Kuldeep and Robertson, C 2010. Fertilizers Statistics

2012-13. Fertilizers Association of India (FAI), New Delhi. Ramachandran, N and Kakani, Ram 2008. Financial Accounting for Management. Tata McGraw-Hill Publications, 2nd Edition.

Pandey, I M 2008. Financial Management. Vikas Publishing House, 9th

Edition

Reports Annual reports of IFFCO Agreement files of IFFCO Websites and Internet www.iffco.nic.in www.wikipedia.com www.investopedia.com www.fert.nic.in www.faidelhi.org www.moneycontrol.com

69

Appendix Financial Statements

BALANCE SHEET

(Rs. in Crores)
Schedule As At 31.03.2013
Shareholders' funds: Share capital Share Application Money Reserve and Surplus Loan Funds: Secured Loans Unsecured Loans Deferred Tax Liability ( Net ) TOTAL Fixed Assets: Gross block Less: Accumulated Depreciation Net Block Capital Work-In-Progress Investments Current Assets, Loans and Advances Inventories Sundry Debtors Cash and Bank Balances Loans and Advances Less: Current Liabilities and Provisions Current Liabilities Provisions Net Current Assets Miscellaneous Expenditure (to the extent not written off)
Voluntary Retirement Scheme Expenses

As At 31.03.2012

1 2 3 4

426.28 3532.59 7373.18 5429.6 3958.87

423.93 3264.73 2404.67 4370.97 3688.66

12802.78 542.12 17303.77

6775.64 534.19 10998.49

5 8808 3842.16 4965.84 290.98 8138.98 3400.04 4738.94 430.85

6 7

5256.82 7552.95

5169.79 1416.73

8 9 10 11

1731.36 407.23 69.63 5464.77 7672.99

1577.1 413.76 243.32 3541.56 5775.74

12 13

2860.18 322.71 3182.89 4490.10

1048.49 323.08 1371.57 4404.17

3.9 17303.77

7.8 10998.49

TOTAL

70 PROFIT AND LOSS ACCOUNT

Schedule INCOME FROM OPERATIONS Turnover Sales Less: Excise Duty Subsidy on Fertilizers Other Revenue Increase/ (Decrease) in Stocks LESS: COST OF OPERATIONS
Consumption of Raw Materials, Stores etc.

For yr 31.03.2013

(Rs. in Crores) For yr 31.03.2012

7387.70 7387.70 25545.60 14 15 32933.30 499.00 280.51 33712.81

5968.47 5968.47 6194.35 12162.82 345.77 (1136.21) 11381.38

Raw Materials Stores and Spares Chemicals and Catalysts Packing Materials Power, Fuel and Water Less: Stock Transfer for Self Consumption Purchase of products for resale Employees' Remuneration & Benefits Manufacturing, Administration, Distribution and Other Expenses Interest Depreciation/ Amortisation Prior Period Adjustments (Net) Deferred Revenue Exp. Written-off (Voluntary Retirement Scheme Expenses) Profit Before Tax Provision for Taxation

13997.22 108.34 41.38 200.39 981.80 15329.13 159.41 16 17 18 19

15169.72 14539.23 595.96 1481.91 1023.20 470.40 (13.46) 3.90 33270.86 441.95

6646.44 96.26 38.22 170.43 756.48 7707.83 118.81

7589.02 1245.44 405.75 959.49 389.37 410.93 (3.00) 3.86 11000.86 380.52

Current Tax
Fringe Benefit Tax

Deferred Tax Earlier Years Profit After Tax Profit transferred to: Capital Repatriation Fund Dividend Equalisation Fund
Contribution towards Approved Donations

92.80 8.02 7.93 (26.81)

81.94 360.01

61.80 6.50 56.14 (1.51)

122.93 257.59

0.47 1.00 1.47

0.46 0.46

(Under Income Tax Act, 1961) Net Profit as per Multi state Cooperative Societies Act, 2002

358.54

257.13

71 CASH FLOW STATEMENT

Year Ended 31.3.2013 (A) Cash Flow from Operating Activities: Net Profit before Tax Adjustment for: Depreciation Interest (Net) Provision for Doubtful Debts Loss on Damaged Goods Write down of Value of Goods-in-Transit Amount charged off / adjusted Assets Written-off Loss on Sale of Investments (Net) Exchange Rate Variations (Net) Loss on Sale of Fixed Assets (Net) Dividend Income Profit on sale of Investments Deferred Revenue Exp. Written off - VRS
Diminution in value of Long Term Investments

(Rs. In Crores) Year Ended 31.3.2012

441.95 470.40 857.19 0.01 17.60 107.68 0.04 13.41 83.16 148.84 4.29 (274.42) 3.90 81.16 (3.88) (0.12) 410.93 362.71 0.31 0.20 2.27 15.47 5.10 2.75 (132.54) (115.22) 3.97 (14.12) 2.95

380.52

Liabilities / Provision written back Prior Period Depreciation Operating Profit before Working Capital Changes Adjustment for: Inventories Trade and Other Receivables Trade Payable and Provisions Cash Generated from Operations Direct Taxes Paid (Net of Refunds)
Payment towards Cooperative Education Fund

1509.26 1951.21

544.78 925.30

(279.54)
(1717.19)

1747.04

(249.69) 1701.52

706.83 (487.06) 3.43

223.20 1148.50

Payment to Cooperative Welfare Fund Donations Paid Net Cash From Operating Activities (A): (B) Cash Flow from Investing Activities: Purchase of fixed Assets including C.W.I.P. Proceeds from Sale of Fixed Assets Purchase of Investments (Net) Dividend Received Profit on Sale of Investments

(135.23) (2.57) (1.90) (1.87)

(141.57) 1559.95

(72.07) (1.75) (1.60) (0.67)

(76.09) 1072.41

(590.82) 11.50
(6300.54)

246.61 -

(594.93) 31.89 (691.73) 132.74 115.22

72
Interest received Net Cash used in Investing Activities (B): (C) Cash Flow from Financing Activities: Proceeds from issue of Share Capital Repayment of Term Loans
Repayment of Deferred Trade Tax Loan (Net)

55.66
(6577.59)

26.26 (970.55)

Increase in Cash Credit Increase in Short Term Loans Interest Paid Dividend Paid Exchange Rate Variation (Net) Net Cash used in Financing Activities (C): NET INCREASE/ (DECREASE) IN CASH AND CASH EQUIVALENTS (A+B+C) CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR CASH AND CASH EQUIVALENTS AT THE CLOSE OF THE YEAR NET INCREASE/ (DECREASE) IN CASH AND CASH EQUIVALENTS

2.35 (362.67) (9.21) 589.37 5809.65

(1008.14)

(84.53) (92.87) 4843.95

0.01 (153.97) (4.10) 160.88 286.72 (389.37) (84.45) (5.10) (189.38)

(173.69) 243.32 69.63 (173.69)

(87.52) 330.84 243.32 (87.52)

73

APPENDIX D: SIGNIFICANT FINANCIAL INDICATORS

2008-09 FINANCIAL RATIOS : Operating Profit to Sales (%) Profit before Tax to Sales (%) Return on Capital Employed (%) Profit before Tax to Net Worth (%) Profit After Tax to Net Worth (%) Fixed Assets Turnover (Times) Working Capital Turnover (Times) Inventory of Finished Goods (Months Sales) Inventory of Raw Material & Packing Material (Months Consumption) Sundry Debtors (Months Sales) Current Ratio Quick Ratio Debt Equity Ratio Employees Productivity No. of Employees Sales per Employee (Rs. Crore) 6757 4.87 6743 1.8 6826 1.51 6506 1.77 5752 1.29 0.74 0.67 2.41:1 1.87:1 3.23:1 1.25 0.78 4.21:1 3.06:1 1.84:1 1.01 0.9 5.06:1 3.15:1 1.78:1 0.86 0.89 3.49:1 2.37:1 1.42:1 0.79 1.17 2.36:1 1.51:1 2.20:1 6.5 1.34 3.12 11.16 9.09 6.32 7.41 0.12 7.8 3.13 3.5 10.31 6.99 2.38 2.62 0.76 6.69 2.43 2.53 6.9 4.81 2.2 2.5 1.48 6.92 4.85 7.18 13.55 9.6 3.01 4.07 0.74 6.52 6.37 10.58 14.27 9.68 3.57 4.58 0.9 2009-10 2010-11 2011-12 2012-13

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Appendix E: Provisional highlights of IFFCO performance during 2012-13

Highest Production of Fertilisers (Previous Best 70.12 lakh MT in 2006-07) Highest Production of Urea (Previous Best 39.63 lakh MT in 2011-12) Production of NPK/DAP/NP (Best 32.26 lakh MT in 2006-07) Highest Sales of Fertilisers (Previous best 93.24 lakh MT in 2011-12) Highest Sales of Urea (Previous best 54.29 lakh MT in 2011-12) Highest Sales of NPK/DAP (Previous best 38.95 lakh MT in 2011-12) Profit Before Tax (Best PBT 807.1 crore in 2002-03) Profit After Tax (Best PAT 557.2 crore in 2002-03) Highest Turnover (Previous best Rs.12163 crore in 2011-12) Plant Productivity (Best 1669 MT in 2008-06) Highest Marketing Productivity (Previous best 6158 MT in 2011-12) Composite Energy Consumption (Lowest 5.907Gcal / MT in 2011-12) 5.941 Gcal/ MT 7397 MT per employee 1376 MT per employee Rs 32933 crore Rs.360.01 crore Rs.441.95 crore 53.89 lakh MT 58.69 lakh MT 112.58 lakh MT 31.00 lakh MT 40.68 lakh MT 71.68 lakh MT

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Appendix F: VALUE ADDED STATEMENT

(Rs. In Crore) Year ended 31.3.2012 12162.82 354.77 12517.59

Particulars Income from Sales Dividend and Other Income

Year ended 31.3.2013 32933.30 499.00 33432.30

Less: Cost of Materials Manufacturing, Admn., Distribution & Other Expenses Total Value Added Applied to meet: Employee Cost Interest Payment Income Tax (Net) Dividend Donations Cooperative Education Fund Retained Cash Profit Total Utilisation of Value Added Ratios Value added to Total Income (%) Value added to Capital Employed (%) Value added to Net Worth (%) Value added per Employee (Rs. Lakh)

29418.89 1481.91

9971.54 959.49

2531.50

1586.56

595.96 1023.20 74.00 85.10 1.75 3.59 747.90 2531.50

405.75 389.37 66.79 84.53 0.75 2.57 636.80 1586.56

7.57 17.89 63.95 37.46

12.67 14.65 43.01 23.53