“A STUDY ON ZERO WORKING CAPITAL MANAGEMENT WITH REFERENCE TO TERUMO PENPOL LTD, TRIVANDRUM”

BY

VIDYA UNNIKRISHNAN

96910631034

PROJECT REPORT

Submitted to

FACULTY OF MANAGEMENT STUDIES

In partial fulfilment of the requirements for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

In

FINANCE

ANNA UNIVERSITY THIRUNELVELI

AUGUST 2011

Bonafide Certificate

Certified that this project reported titled “A STUDY ON ZERO WORKING

CAPITAL MANAGEMENT WITH REFERENCE TO TERUMO PENPOL LTD;

TRIVANDRUM, KERALA.” the bonafide work of Ms. Vidya Unnikrishnan,

96910631034 who carried out the research under my guidance certified further, that to the

best of my knowledge the work reported here in does not form part of my other project report

or dissertation on the basis of which a degree or award was conferred on an earlier occasion

on this or any other candidate.

Internal Guide Head of the Department

Ms. M.Barvin Banu, MBA, DCA Ms. S.Angel Raphella MBA,

M.Phil, PhD

Submitted to Project Viva Examination held on 

Internal Examiner External Examiner

VIDYA UNNIKRISHNAN

II MBA

Department of Management Studies

SCAD College of Engineering & Technology

Cheranmahadevi

Tirunelveli District – 627414

DECLARATION

I hereby declare that “A Study on Zero Working Capital Management with reference to

TERUMO PENPOL LTD, Trivandrum.” in partial fulfilment of the requirement for

award of the degree of Master of Business Administration to Anna University in my original

work done during the period of study in SCAD Engineering College, Tirunelveli District,

under the guidance of Miss. Barvin Banu, Lecturer in Department of Management Studies.

It has previously not formed the basis for the award of any degree and that work has

not been published in any journal or magazine before. 

 

VIDYA UNNIKRISHNAN

96910631034

ACKNOWLEDGEMENT

I express my deepest and sincere thanks to our respected Chairman Dr. Cletus Babu,

for providing all required facility for completing the project.

I sincerely acknowledge my deep gratitude to Dr. Mohammed Sheriff, Principal,

SCAD College of Engineering & Technology, Anna University, Tirunelveli, who gave me an

opportunity to submit the project work for the partial fulfilment of my M.B.A program.

I acknowledge my sincere gratitude to respected Head of the Department Ms. S.

Angel Raphella MBA, Mphil, (Phd) for providing me necessary formal sanctions required

for carrying out the study.

I also express my sincere gratitude to my project guide Lecture Miss. M.Barvin Banu,

MBA,DCA who soluble guidance helped me to complete my study successfully.

I express my sincere gratitude to the Management of Terumo Penpol Ltd. For granting

me permission to under taken this project. I would like to thanks the entire respondents and

friends in Terumo Penpol Ltd for extend their whole – hearted Co – operation for the

completion of my project.

I would like to thank Mr. Abilash R, Executive Accounts, who assisted me to

complete my training successfully in the company and also remember my parents, friends and

relations for the encouragement.

Above all I would like to thanks god, the almighty.

VIDYA UNNIKRISHNAN

INTRODUCTION

Working capital is the comparison of current assets to current liabilities. For most

organizations, current assets exceed current liabilities and working capital therefore

represents the liquid reserves for meeting current obligations. Creditors prefer high levels of

working capital since they are concerned about receiving payment. However, management

prefers low levels of working capital since working capital earns an extremely low rate of

return. Some companies are now driving working capital to record low levels, so-called Zero

Working Capital. By keeping working capital at zero, funds are released for many other

opportunities.

Zero Working Capital requires major changes in how an organization functions. One

way to implement Zero Working Capital is to have a demand-based organization. Demand-

based organizations do everything only as they are demanded: Fill customer orders, receive

supplies, manufacture products, and other functions are done only as needed. The production

facilities run 24 hours a day non-stop according to the demands within the marketplace.

There are no inventories; everything is supplied immediately as needed. The end result of this

demand driven organization is that little, if any, working capital is necessary to run the

business.

Companies like GE (General Electric) and Campbell Soup have made Zero Working

Capital a major strategic objective for the organization. As more and more businesses find

faster ways of servicing customers, the concept of Zero Working Capital will become more

mainstream.

1.1 INTRODUCTION TO THE TOPIC

Every business needs funds for two purposes for its establishment

and to carry out its day-to-day operations. Funds are also needed for short-term purposes for

the purchase of raw material, payment of wages and other day-to-day expenses etc. These

funds are known as working capital. In simple words, working capital refers to that part of the

firm’s capital which is required for financing short-term or current assets such as cash,

marketable securities, debtors & inventories. Funds, thus invested in current asset keep

revolving fast and are being constantly converted in to cash and this cash and this cash flows

out again in exchange for other current assets. Hence, it is also known as revolving or

circulating capital or short-term capital.

Management of working capital is concerned with the problem that

arises in attempting to manage the current assets, current liabilities. The basic goal of

working capital management is to manage the current assets and current liabilities of a firm in

such a way that a satisfactory level of working capital is maintained, i.e. it is neither adequate

nor excessive as both the situations are bad for any firm. There should be no shortage of

funds and also no working capital should be ideal. Working capital management policies of a

firm has a great on its probability, liquidity and structural health of the organization. So

working capital management is three dimensional in nature as

It concerned with the formulation of policies with regard to profitability,

liquidity and risk.

It is concerned with the decision about the composition and level of current

assets.

It is concerned with the decision about the composition and level of current

liabilities.

Requirement of Working Capital

To pay suppliers

To pay salary

To pay taxes

To pay dividend

To pay other expenses

Zero working capital means “no fund is used as floating capital.

Before making the payment to sub-suppliers; the manufacturer receives payment from

buyers. This can be realized as production is scheduled at request of customers. This will

result in healthy operation of the enterprise. Some companies are now driving working capital

to record low levels, so called “Zero Working Capital”. By keeping working capital at zero,

funds are released for many other opportunities.

Zero Working Capital requires major changes in how an organization

functions. One way to implement zero working capital is to have a demand-based

organization. Demand-based organizations do everything only as they are demanded: fill

customer orders, receive suppliers, manufacture products, and other functions are done only

as needed. The production facilities run 24 hours a day non-stop according to the demands

within the market place. There are no inventories; everything is supplied immediately as

needed. The end result of this demand driven organization is that little, if any, working capital

is necessary to run the business.

CA-CL=Net WC

When CA>CL, it is +ve WC

When CA<CL, it is –ve WCWhen

CA=CL, it is Zero WC

Zero Working Capital Cycle

Today’s world of intense global competition, working capital management is

receiving increasing attention form managers striving for peak efficiency the goal of many

leading companies today, is zero working capital. Proponent of the zero working

capital concept claims that a movement toward this goal not only generates cash but also

speeds up production and helps business make more timely deliveries and operate more

efficiently. The concept has its own definition of working capital: inventories+ receivables-

payables. The rational here is (i) that inventories and receivables are the keys to making sales,

but (ii) that inventories can be financed by suppliers through account payables.

Companies use about 20% of working capital for each sale. So, on average, working

capital is turned over five times per year. Reducing working capital and thus increasing

turnover has two major financial benefits. First every money freed up by reducing inventories

or receivables, by increasing payables, results in a one time contribution to cash flow.

Second, a movement toward zero working capital permanently raises a company’s earnings.

The most important factor in moving toward zero working capital is increased speed. If the

production process is fast enough, companies can produce items as they are ordered rather

than having to forecast demand and build up large inventories that are managed by

bureaucracies. The best companies delivery requirements. This system is known as demand

flow or demand based management. And it builds on the just in time method of inventory

control.

4

Pay for original stock out cash outflow

1

Buy RM on credit No cash out flow

2

Produce and sell to customers on credit No cash inflow

3

Customers pay for goods bought on credit cash

inflow

Clearly it is not possible for most firm to achieve zero working capital and infinitely

efficient production. Still, a focus on minimizing receivables and inventories while

maximizing  payables will help a firm lower its investment in working capital and achieve

financial and production economies.

Advantages of Zero Working Capital

Better cash flow

Better cash management.

Can utilize available funds for profitable activities.

Good credit worthiness.

1.2 INDUSTRY PROFILE

Blood Transfusion is an integral part of the Health Care delivery in any

country. In fact it is the most important part of the health Care System. In India blood is

classified as a drug under the drugs & Cosmetics Act. India requires about 50 lakh unit of

blood every year across the country. Blood is collected in blood bags (350ml/450ml) range.

The blood collection and issue is done by 1920 blood banks spread across the country. Blood

bags are manufactured using medical grade PVC granules under good manufacturing

practices (GMP) and standard clean room conditions. Blood bag is a disposable bio-medical

device used for collection, storage, transportation and transfusion of human blood and blood

components. The system consists of a single or multiple bags connecting with tubing, needle,

needle cover, clamp etc. The blood bags are made of plastic materials which are compatible

with blood. Blood bags can successfully replace the use of glass bottles for collection,

storage, transportation, and transfusion of blood and blood components since bottles require

exhaustive cleaning, rinsing, and autoclaving procedures and there are chances of breakage at

any stage. Further, use of disposable bags eliminates the possibility of ant contamination. In

recent times, blood bags have become a conspicuous item and essential need of hospitals and

nursing homes to meet blood infusion emergencies. Blood bags are most ostensibly serving

the medical field in crucial hour. As the number of hospitals, the demand for the blood bags

too is increasing tremendously.

A blood bag system comprising a container holding an inactivator that

inactivates a microorganism contained in blood, a container holding an anticoagulant and a

connecting tube connected liquid-tightly to the container, wherein inactivator contains as a

main component a platinum compound capable of binding to nucleic acid of the

microorganism or an aquo complex of the platinum compound; and a tube for introducing a

neutralizing agent to neutralize the inactivator is connected with the container holding the

inactivator.

Indian R & D organization is offering technology for the manufacture of

disposable blood bag systems. Blood bag system is a disposable bio-medical device used for

collection, storage, transportation and transfusion of human blood and blood components.

The system consists of a single or multiple bags connected with tubes, needle, and needle

cover, clamp etc. The blood bags are made of plastic material which is compatible with

blood. Blood bags can successfully replace the use of glass bottles for collection, storage,

transportation, and transfusion of blood and blood components since bottles require. Blood

bags are Plasticized Poly Vinyl Chloride bags (PVC) containers and are a complete system

with collection tube, outlet ports & an integral needle.

Advantages of Indian technologies:

Low capital investment.

High employment potential

Maximum use of local raw materials and manpower resources.

Adaptable levels of sophistication

There are four indigenous manufactures of blood bags in

the country and two manufactures from abroad that manufacture outside and sell here in the

market. The indigenous manufactures are Terumo Penpol Ltd, J Mitra Ltd, Hindustan Latex

Ltd & Eastern Medikit ltd. Globally, approximately 75 million blood bags are collected

annually. Major blood bags manufactures globally include Baxter Bioscience, USA; Bayer

Corporation, USA and Octapharma AG, Switzerland. With the increasing global demand for

blood bags and growth rate of its market being 10 percent annually, the business for the

potential investor would need to set up highly standardized plant as the demand for these

products largely depend on their quality.

Eastern Medikit Limited

Eastern Medikit Limited is amongst the largest and most diverse manufacturers of

medical disposables, with exports in over 78 countries. We have consistently surpassed the

highest expectations of our customers in terms of truly international product quality (ISO

9001:2000, ISO 13845:2003, CE) and value-pricing. IV Cannula (We are among the largest

Indian manufacturer and exporters), blood banking devices, respiratory care devices, blood

collection tubes are some of the areas we specialise in.

As per the exact requirements of our customers, we incorporate various fabricated

range of capacities, sizes & other parameters in our entire product assortment. Today, the

increasing demand of our devices from various medical associations is due to their perfection

in terms of our performance, safety & efficiency and the ability to adjust them to unique

customer requirements. Our commitment Our valued commitment to our customers is based

on our integrity, acquiring excellence and never ending enthusiasm. It gives us a feeling of

pride that some of our committed clients are with us since 1990’s when they first tried us. It

is through some of these bonds with our customers and suppliers that today MEDIKIT and

its products are recognized in over 80 countries worldwide.

J Mitra & Co. Private Limited

Blood Bags Division: Considering the acute need of blood collection bags in the

country, to meet its rising demands, the company decided to set up an indigenous state

of the art manufacturing unit at Faridabad for manufacture of blood bags. Accordingly

work was commenced in 1995 and the indigenous blood bags manufacture & sale was

launched in 1997.

MITRA INDUSTRIES (P) LTD is a reputed and established name in the field

of Blood Collection Bags and CAPD bags for home dialysis, Products are of high

quality and supplied across Asia Europe and parts of African sub-continent. MIPL

manufactures and markets CAPD Bags for home dialysis, which are used to remove

extra fluid and toxic metabolic waste products from the blood thereby enabling the

kidney failure patient to lead a near normal life. MIPL also provides total Blood

Banking solutions in the form of wide varieties of blood collection bags and blood

bank equipments

HLL Lifecare Limited

HLL Lifecare Limited (HLL) commenced its journey to serve the Nation in the area

of healthcare, on 1st March 1966, with its incorporation as a corporate entity under the

Ministry of Health and Family Welfare, Government of India. HLL was set up in the natural

rubber rich state of Kerala, for the production of male contraceptive sheaths for the National

Family Welfare Programme. HLL commenced commercial operations on 5th April 1969 at

Peroorkada in Thiruvananthapuram (formerly Trivandrum). The Plant was established in

technical collaboration with M/s Okamoto Industries Inc. Japan.

Two most modern Plants were added, one at Thiruvananthapuram and the other at

Belgaum in 1985. Another Plant was added in the early nineties at Aakkulam in

Thiruvananthapuram for the production of Blood Transfusion Bags, Copper T IUD’s,

Surgical Sutures and Hydrocephalus Shunt. HLL has grown today into a multi-product,

multi-unit organization addressing various public health challenges facing humanity.

HLL had set its sights in 2003 - when it had a turnover of a mere Rs 163 crores - to be

a Rs 1000 crore company by the year 2010. On the path of rapid growth, this year (2010) it

has not only surpassed this figure but has drawn a clear road map to achieve a five fold

growth by the year 2015.

HLL is today a Mini Ratna and upgraded as a Schedule B Central Public Sector Enterprise.

HLL Lifecare Limited is the only company in the world manufacturing and marketing

the widest range of Contraceptives. It is unique in providing a range of Condoms, including

Female Condoms, Intra Uterine Devices, Oral Contraceptive Pills - steroidal, non-steroidal

and Emergency contraceptive pills; and Tubal Rings. HLL produces today 1.316 billion

condoms annually making it one of the world’s leading manufacturers of condoms,

accounting for nearly 10 percent of the global production capacity.

HLL’s Health care product range include: Blood Collection Bags, Surgical Sutures,

Auto Disable Syringes, Vaccines, In - Vitro Diagnostic Test Kits, Pharma products for

Women, Natural products, Hydrocephalus Shunt, Tissue Expanders, Surgical and

Examination Gloves, Blood Banking equipment, Neonatal euipment, Blood Transfusion and

Intravenous sets, Vending Machines, Iron and Folic Acid Tablets, Sanitary Napkins, Oral

Rehydration Salts and Medicated Plasters.

HLL’s Blood Bags were launched in Brazil in 2006. HLL also launched its non-

steroidal contraceptive pill under the brand name Ivyfemme in Peru in October 2008. HLL

has introduced Closed System Blood Bags that are integrated with Leukocyte Filter - called

LD Bags. These bags are intended for leuko-depletion immediately upon collection of blood

from donors at blood banks.

In collaboration with The Female Health Company (FHC), of US, HLL is marketing

FC female condom in India. The female condom is the only female controlled prevention

technology approved by the US FDA and the WHO. HLL launched the nitrile female condom

- Velvet in India in Decembrer 2007. Targeted at contemporary Indian women and new age

couples, nitrile condoms empower women providing dual protection against unwanted

pregnancy and STDs, HIV/AIDS. HLL has also launched several initiatives in the services

sector – for medical infrastructure development, diagnostic centres and procurement

consultancy. These have been conceived to bring about a whole new realm of accessible,

affordable healthcare delivery to every citizen.

Over the years each of the initiatives taken up by HLL are targeted at reaching quality

healthcare at the doorstep of every family. Associate Institutions of HLL namely HLFPPT

and LifeSpring Hospitals have ensured this to the nation’s underserved and vulnerable

populace, at an affordable cost. With a vast array of innovative products and social

programmes to meet the nation’s health care needs, HLL Lifecare Limited (HLL) is firmly on

track, with its vision of Innovating for Healthy Generations.

1.3 COMPANY PROFILE

Terumo Penpol is India’s largest manufacturer of blood bags. The company is one of

the largest producers of blood bags in Asia, other than Japan with a capacity of 13 million

blood bags. The company has come a long way since its beginning in 1987. The company

pioneered the manufacture of blood bags in India and then successfully launched a range of

medical electronic products required for blood transfusion centers. Driven by its strong

customer-focus and innovative spirit, the company has been the market leader ever since it

introduced blood bags in India. Today, it is more than double size of any other blood bag

manufacturer in India. Not only does Terumo Penpol offer customers a wide range of blood

bags and blood bank equipment, but also offers tailor made products to meet specific

requirements.

Terumo Penpol is part of the multi billion dollar Terumo Corporation, a Japanese

company having its presence in over 150 countries. Terumo has distinguished itself as a high

quality manufacturer of medical products, with 13 factories around the world. The company

generates annual sales of about $2.0 billion and employs 12,322 people worldwide. Terumo

is pioneering products of future like implantable left- ventricular assist systems, artificial

vessels, minimally invasive surgery devices.

Terumo Penpol has 700 customers all over India and its blood bags are sold in over 60

countries across the world and its Medical Equipment Division has more than 1900

installations to its credit. Terumo Penpol has it’s headquarter In Thiruvananthapuram and

employs 845 people. The company has an experienced team of marketing and sales

professionals covering the whole of India. A well-trained service group further supports the

team.

Terumo Penpol Ltd (TPL) has opened its new factory premises on 28 th may 2008. The

new plant will enable Terumo Penpol to double its production capacity from the existing 13

million. A significant portion of this output will be exported. The company has been

consistently winning top exporter awards for medical disposables and surgical products. The

Plastic Exports Promotion Council has feted TPL as the second best exporter for nine

consecutive years from 1999.

Mission Statement

“Better ways to Better Healthcare”

Their perception is that today’s best will be replaced by something still better tomorrow.

Vision statement

The manufacturing facility follows an integrated production system from raw

materials to finished products, ensuring strict adherence to GMP. The production system

ensures careful selection of materials, components, controlled production environment,

comprehensive testing of all inputs, intermediate products and finished goods. The main

feature of their manufacturing facility is the flexibility it offers.

Terumo Penpol offers:

Flexibility in Product Features.

Flexibility in Minimum Order Quantity.

Flexibility in Delivery Schedule.

At Terumo Penpol, quality is a way of life. Utmost care and attention is given to each

and every stage of production to ensure strict adherence to GMP and CE mark standards. The

quality management system of Terumo Penpol is certified according to ISO 9001:2000, ISO

13485, European Standards EN 46001 and European Medical Device Directive 93/42/EEC.

Quality Policy

It is the policy of Terumo Penpol Ltd,

To manufacture high quality products meeting customer and regulatory requirement.

To design all products in accordance with international standards.

To ensure high quality at all stages of the supply chain.

By the above Terumo Penpol will contribute to society through healthcare.

Terumo Penpol is committed to continuously review and improve the effectiveness of

the quality management system.

Certifications obtained and standards followed.

The Quality Management system of Terumo Penpol Ltd confirms to the requirement of

Medical Device Directive 93/42/EEC (1993)

ISO 13485:2003; Quality Management System for medical devices.

BS EN 554:1994; specifies requirements for the process development, process control

and monitoring of the sterilization of medical devices.

BS EN 556:2001; requirements for medical devices to be labeled sterile.

BS EN 980:2003; specified graphical symbols for use in the information supplied by

the manufacturer with medical devices,

ISO 9001:2000; this international standard specifies requirements for a quality

management system,

Indian Pharmacopoeia.

US Pharmacopoeia.

WHO standard

ISO 9002 Certification for Manufacturing and Marketing blood bags (1995).

ISO 9001 Certification for Design and manufacturing [Equipment Division] (2000).

PRODUCT PROFILE

Product Categories:

Blood bags & Accessories.

Storage Equipment for Blood Banks.

Blood Collection Devices.

Blood Bags.

The TERUMO Blood Bag systems are high quality products designed for optimum

blood management during collection, separation, preservation and transfusion.

Various types of blood bag systems with improved storage period of blood and blood

components are available. A new range of Blood Bags provides the Blood Banks with

a large choice of safety features. Five types of blood bags catering to various patient

needs: Single, Double, Triple, Quadruple and Penta Blood Bags and two options of

anticoagulant solution CPD and CPDA-1 are available. Also available Blood Bags

with additive solution S.A.G.M.-1 and S.A.G.M.-2 (OPTISOLTM).

SAMPLING AND SAFETY FEATURES

Type of Blood

Bag

Volume (ml)

100 150 250 300 350 450

Single Bag

CPDA 1

Double Bag

CPDA 1     

Triple Bag

CPDA 1     

Quadruple Bag

CPDA 1     

Penta Bag

CPDA 1       

Triple Bag

CPD-SAGM     

Quadruple Bag

CPD SAGM     

Transfer Bag      

TACE Sagm

Buffy Bags   

Occupational exposure to blood remains a serious concern during the blood donation process.

In order to address the safety issues concerning the blood bank personnel, we have introduced

a range of features in our blood bags. The sampling and safety features are available on all

configurations of blood bags.

Needle Injury Protector: Reduces the risk of needle stick injury from both donor and

sampling needles. It provides immediate shielding of needle on withdrawal from vein.

Blood Sampling arm with and without Luer Adaptor and Tube Holder: Facilitates safe

in-line sampling. The unique LUER adapter, needle provides for a safer sample collection

using vacuum tubes.

Pre-donation Sampling Bag: The Pre-donation Sampling Bag enables to divert and to collect the

first amount of blood. Initial quantity of blood collected tends to contain skin particles, bacteria

present at the site of venepuncture and dust particles. The remaining blood free of impurities is

collected in the primary bag. During blood collection blood samples can be collected from the Pre-

donation Sampling Bag using vacuum blood collection tubes.

Filters – Terumo IMUGARD III

Terumo IMUGARD III filters utilize highly biocompatible polyurethane material

to remove leukocytes from freshly produced or stored blood components. The independent

systems of Imugard filters are available in various configurations and for various applications.

Typically all these systems are made available with the latest advancements to improve operator

comfort and patient safety. Terumo IMUGARD III filters are available for removal of leukocytes from

platelet concentrates and red cell concentrates. The IMUGARD III filters are available in bedside and

laboratory configurations.

The IMUGARD III filters offer the following features:

Biocompatible polyurethane filter

Unique microporous structure of polyurethane material

Hydrophilic filter

Unique air-vent

TERIFUSION BLOOD ADMINISTRATION SET

Product Features Terifusion Blood Administration Set

Specification Benifits

Spike54.2 +/- 5(mm) Length

Easy insertion into Transfusion Pot

Protector47.5 +/- 5(mm) Length

Tight Fitted in Spike, ensures sterility even after taking out of pouch

Big Double Chamber

140 +/- 2(mm) Length

Allows smooth filtration and flow of blood

Roller Clamp 45 +/- 2(mm) LengthGives perfect grip and flow can be properly controlled

Filter mesh83 Mesh ( 60mm Lenght)

Ensures smooth filtration without blocks

Drip Chamber Material

Polypropylene Bio Compatible

Sterility assurance level

(SAL)Micron Ensured sterility

Quality System EN ISO 13485:2003 Assured as per standards

Medical Equipments- Collection

. TUBE SEALER – XS1010

The XS1010 model heavy-duty radio frequency bench top sealer provides wide, reliable,

snap-apart seals. This lightweight compact tube sealer conserves space in the work area and

has international safety certification of EN61010-1. It produces hermetic seal by waves

minimizing contamination and haemolysis of blood and blood components and the sealing

head is easy to clean.

Blood Collection Monitor - D601

The D601 model is designed to meet all international safety requirements of EN60601-1. It

ensures safety to the donor, user (phlebotomist) and the recipient (patient). The gentle

oscillation movement ensures continuous and uniform mixing of blood with anticoagulant to

eliminate blood clots. This model provides step by step instruction for use on the display

panel and has provision to pause collection and change programmed volume. It has 8 hour

battery backup which ensures smooth operations in blood banks as well as in mobile units.

Donor Station - DC200

The uniquely designed leg position suits the hemodynamic of the human body for ensuring

safe and comfortable blood donation and minimizes the onset of vasovagal attacks. The

DC200 model is provided with stands for Blood Shaker, BP Apparatus and IV Fluids; which

ensure convenience for users as the stands can be swiveled from one side to the other

depending on the arm from which blood is drawn. DC200 is designed to meet all

international safety requirements of EN60601-1, and ensures safety, comfort and convenience

to the donor as well as the phlebotomist.

Blood Weighing Scale CS300 - Intelligent Expressor IE300.

CS300/IE300.

The CS300 Blood/Component Weighing Scale provides accurate weight and

volume of blood and its components. Easy conversion of weight to volume and vice versa.

The Compare Mode for comparing the weight of two bags helps in balancing the bags for

refrigerated centrifuge. Zero set provision accounts for the weight of the bag. This

Blood/Component Weighing Scale has a built-in interface to integrate an Electronic Plasma

Expressor. As the programmed weight or volume is attained the clamp gets activated

stopping the process of component transfer into the satellite bag.

Processing

Terumo Automatic Component Extractor

A highly flexible automatic blood component extractor for the standardized

processing of centrifuged blood according to good manufacturing process. The device is

designed to be used with all common standard bag systems. Its top angled press with press

position detection ensures high stability of layers during extraction. It gives high quality, non

contaminated products with maximum component yield and viability with a reduction in

leukocytes through buffy method.

Plasma Expressor - E300

The optical sensor heads of the E300 and E250 models of the electronic

plasma expressor provides precise separation with minimum contamination. E300 offers

same efficiency of separation across different brands of blood bags. Up to 4 plasma

expressors can be interconnected from single power source.

TERUMO STERILE TUBING WELDER

The TSCD creates strong and consistent sterile welds while maintaining a

functionally closed system. With TERUMO's TSCD, sterility is preserved without damage to

cells or fluids. This is the only solution to prevent bacterial contamination during the

applications of:

i. Component Pooling

ii. Leukoreduction

iii. Collection set modification

iv. Component Aliquoting

v. Apheresis set modification.

vi. Quality control sampling.

vii. Stem Cell processing.

viii. Cell Washing.

ix. Freezing etc.

Cryo Bath - CB100

The Composafe Cryo Bath is designed for the safe thawing of fresh frozen

plasma at 4ºC for the optimum yield of Cryo precipitate. The microprocessor based controller

ensures precise monitoring of temperature. CB100 has a capacity of 12 Plasma bags per

cycle. The Cyro Bath CB100 is provided with lockable castor wheels for easy transportation.

Storage

Platelet Agitator with Incubator - PA/PI200

The Composafe PA/PI200 is designed to meet all international safety requirements of

EN60601-1. This product stores platelet concentrates in continuous motion at controlled

temperature. Digital temperature control monitor coupled with a unique air circulation system

maintains incubator at a uniform temperature of 22+- 2ºC within the Incubator chamber as

per FDA recommendation. There are visual indications and audio alarms for temperature

variation, open door and agitator failure. PA/PI200 Platelet Agitators come in two options: 24

and 48 bag capacities.

Blood Bank Refrigerator - 165L, 300L, 600L

The unique forced airflow system ensures uniform temperature to all units of blood with

maximum variation of +- 1ºC in all parts of the cabinet. The refrigerators come with

condensate evaporator and automatic defrosting. The temperature recorder has a 2 hour

battery backup to record temperature during power failure. The refrigerators are available in

165L, 300L and 600L capacity and with Metal and Glass door option.

Deep Freezer - DF40U

The -40ºC Deep Freezers are suitable for storage and preservation of plasma and preserving

the labile factors during the shelf life. High quality stainless steel interior helps maintain

temperature and provides ease of cleaning.

Management Trustees :

Name of the Chairman :

Name of the MD :

Name of the Finance Manager :

Address of the Concern:

ORGANIZATION STRUCTURE

Chairman

Managing Director

Executive Company Management Finance Administration HR

CCD IT

GM

Manufacturing

GM

Marketing

GM

Export

GM Medical

System Group

Marketing Domestic

Logistics Sales & Services

Technical Production Personnel Materials

QAD NPD/PED

PPC Process Production

Stores Purchase

SIGNIFICANCE OF THE STUDY

Working Capital is usually life blood of a business. The excess working capital

creates dead funds which should not be utilized effectively. Zero Working Capital

Management helps in the effective utilization of the funds and it helps in the diversification

of excess funds into productive resources. The significance of the study focuses on the

effective utilization of funds as per requirements and avoid wastages of unproductive

FUNDS.

SCOPE OF THE STUDY

The study is an attempt to analyze the applicability of zero working capital

management in Terumo Penpol Ltd. The study gave an idea about the importance of working

capital in an organization. This study may also help the researcher to develop new ideas,

techniques, and methods in respect to the working capital management.

STATEMENT OF PROBLEM

In this study the full focus was given to Working Capital Management

evaluation of Terumo Penpol Ltd, & the other aspect of financial analysis such as liquidity is

also considered. The study is conducted to analyse whether the technique of Zero working

capital management could be implemented in the organization and thereby the firm can keep

working capital at zero level & thus the funds may be released for further opportunities.

OBJECTIVES OF THE STUDY

1. To determine whether the technique of Zero working capital management could be implemented in Terumo Penpol ltd through the study of current working capital.

2. To find Working Capital Management evaluation of the organization.

3. To analyze the level of Current Assets and Current Liabilities with reference to

previous years.

4. To analyze the Liquidity position of the firm.

5. To provide suggestions for betterment of performance.

LIMITATIONS OF THE STUDY.

1. Only financial datas with reference to the last 5 years was taken.

2. Financial statements are generally based on historical or original cost. The current

economic conditions are generally ignored.

CHAPTERISATION

The project was undertaken in different steps & analysis of the data both

primary and secondary was done to arrive at certain findings.

Chapter I: Deals with introduction which includes the topic, organization profile,

significance and scope of the study, statement of problem, objectives and limitation of the

study finally the chapterisation.

Chapter II: Includes the Review of Literature and Foot notes

Chapter III: Includes Research Methodology, introduction to Research Methodology,

Sampling Design, data collection, and analytical tools.

Chapter IV: Deals with analysis and interpretation.

Chapter V: It covers findings, suggestions and conclusions.

Finally project winds up with bibliography.

INTRODUCTION TO REVIEW OF LITERATURE

A Literature Review is the body of text that aims to review the critical points of

current knowledge including substantive findings as well as theoretical and methodological

contributions to topic. Literature review are secondary sources and as such, do not report any

new or original experimental work.

Most often associated with academic oriented literature, such as theses, a literature

review usually precedes a research properly and results section. Its ultimate goal is to bring

the reader up to date with current literature on a topic and forms the basis for another goal,

such as future research that may be needed in the area.

A well structured literature review is characterised by a logical flow of ideas, current

and relevant reference with consistent, appropriate referencing style proper use of

terminology and an unbiased and comprehensive view of the previous topic on the topic.

REVIEW OF LITERATURE

ZERO WORKING CAPITAL MANAGEMENT

Working capital is the comparison of current assets to current liabilities. For most

organizations, current assets exceed current liabilities and working capital therefore

represents the liquid reserves for meeting current obligations. Creditors prefer high levels of

working capital since they are concerned about receiving payment. However, management

prefers low levels of working capital since working capital earns an extremely low rate of

return. Some companies are now driving working capital to record low levels, so-called Zero

Working Capital. By keeping working capital at zero, funds are released for many other

opportunities.

Zero Working Capital requires major changes in how an organization functions. One

way to implement Zero Working Capital is to have a demand-based organization. Demand-

based organizations do everything only as they are demanded: Fill customer orders, receive

supplies, manufacture products, and other functions are done only as needed. The production

facilities run 24 hours a day non-stop according to the demands within the marketplace.

There are no inventories; everything is supplied immediately as needed. The end result of this

demand driven organization is that little, if any, working capital is necessary to run the

business.

Companies like GE (General Electric) and Campbell Soup have made Zero Working

Capital a major strategic objective for the organization. As more and more businesses find

faster ways of servicing customers, the concept of Zero Working Capital will become more

mainstream.

Working capital is the current assets minus current liabilities. Creditors prefer high

working capital levels as they signify a stronger ability to meet short term obligations. Still,

financial managers prefer minimal working capital. This means a company's assets are not

being tied up in daily operations and can be utilized elsewhere. When attempting to minimize

working capital a company wants to convert receivables as quickly to cash as possible, they

want to fill orders on demand instead of keeping heavy inventory, and they want to hold out

on paying payables as long as possible without injuring credit. This requires awesome vendor

or supplier relations and constant improvements in servicing clients.

Explanation of the Concept

What is Zero Working Capital? In financial terms, zero working capital is the state where the

total accounts receivable, accounts payable, and inventory is zero. Inventory + Account

Receivables – Accounts Payables = 0.

A company uses its working capital to purchase inventory, sell goods on credit,

collects accounts receivable, and then again purchase inventory. The amount of working

capital deployed in a cash conversion cycle bases itself as an optimal trade-off between

reducing working capital deployed to purchase inventory, and the potential loss of sales

owing to reduced inventory levels or higher costs owing to longer periods of deferred

payments.

Zero working capital tries to minimize the working capital deployed in the cash

conversion cycle to the extent possible, and if possible, continuing the process without any

working capital at all. Zero working capital is a working capital strategy that closely relates to

the Just-in-Time methodology. Both the concepts place emphasis on stocking minimal or

zero inventories to reduce waste and minimize the use of resources. [Frank Wood & Alan

Sangster; Frank Wood's Business Accounting Volume 1, 11th Edition.]

How it Works

There are many ways to operate with zero working capital. Some options include:

Switch over to demand-based functioning, that is undertaking any activity only on

demand. Such an organization starts from a different point in the cash conversion

cycle. Instead of buying inventory with working capital, it waits for a specific order

and purchases inventory by either collecting advance payments from the client or by

deferring payment to the supplier.

Outsourcing the entire manufacturing process. The outsourced production supplier

drop ships the product to the customer allowing the company to do away with

maintaining any inventory, or spend money on manufacturing facilities and

overheads. The company makes payments to the outsourced manufacturer only when

the customer receives the goods and releases payment.

Financing inventories by suppliers through accounts payables is another feature of

using the zero working capital method. Companies stop selling on credit, adopt an

aggressive collection policy to collect payments on time, and collect payments in

advance, and simultaneously, delays or stretches out payments to suppliers.

Eliminating accounts payable by centralizing operations to reduce multiple rents and

other overheads, leasing assets such as machinery instead of purchasing them and

making the lease payment out of the accounts receivable, and striking strategic

functional area partnerships with other companies to use their resources such as

marketing, to avoid expenditures on relevant heads. [John Dyson; Accounting for

Non-Accounting Students, 8th Edition]

Application

When is the methodology of a zero working capital process used?

Companies such as Dell, General Electric, and Campbell Soup have implemented

zero working capital to improve their financials. The shift of zero working capital becomes

easy when the company's products are in high demand, there are few competing products,

and when the company commands a demanding position in the supply chain, with suppliers

valuing the company's order.

Advantages

Zero working capital helps the company attain financial and production economies by

freeing up blocked cash permanently and thereby, raising the company’s earnings, and

speeding up the production and sales process to reduce lag in cash inflows.

The concept of zero working capital is still in its infancy. As competitive pressure

forces companies to make maximum advantage of its resources, more and more companies

look into what is zero working capital, and means to attain such a state.

Most businesses require working capital to run operations. Zero working capital is an

innovative approach where businesses operate without blocking cash in working capital. This

approach works in tandem with the Just in Time (JIT) methodology where purchase of the

required inputs takes place on an as needed basis, and payments are usually made after

receiving payment from the customers. Businesses would do well to adopt such methods and

save considerable costs.[ Manish Mittal and Aruna Dhade]

Other related business cost reduction ideas include renegotiating contracts for better deals,

opting for debt consolidation, and similar financial management initiatives.

This is made possible by using different management techniques for each of these elements

of working capital:

Accounts Receivable

The goal in managing accounts receivable is to shorten the time needed for customers to pay

the company. This can be done through several approaches:

1. One is to use a very aggressive collections team to contact customers about overdue

payments and ensure that payments are made on time.

2. Another approach is to tighten the credit granting process, so that potential customers

with even slightly shaky credit histories are kept on a very short credit leash or

granted no credit at all. A final approach is to drastically shorten the standard

customer payment terms, which can even go so far as requiring cash payments in

advance.

 

Inventory

The goal in managing inventory is to reduce it to the bare minimum , which can be achieved

in two ways:

1. One is to outsource the entire production operation and have the production supplier

drop ship deliveries directly to the company’s customers, so that the company never

has to fund any inventory—the company never purchases raw materials or work-in-

process. Instead, it pays the supplier when finished goods are delivered to its

customers.

2. A different approach is to use a manufacturing planning system, such as just-in-time

(JIT). Under this concept, the inventory levels needed to maintain a proper flow of

inventory are reduced to the bare minimum through a number of techniques, such as

many small supplier deliveries straight to the production line, kanban cards to control

the flow of parts, and building to specific customer orders.

Accounts Payable

The goal in managing accounts payable is to not pay suppliers for as long as possible:

1. One way to do this is to stretch out payments, irrespective of whatever the supplier

payment terms may be. However, this will rapidly irritate suppliers, who may cut off

the credit of any company that consistently abuses its designated payment terms.

2. A better approach is to formally negotiate longer payment terms with them, perhaps in

exchange for slightly higher prices. For example: terms of 30 days at a price point of

$1.00 per unit may be altered to terms of 60 days and a new price of $1.02 per unit,

which covers the supplier’s cost of the money that has essentially been lent to the

company. Although there is a cost associated with lengthening supplier terms, this

may be a good deal for a company that has few other sources of funds.

  Forcing longer payment terms on suppliers is much easier if a company knows that it

comprises a large part of its suppliers’ sales, which gives it considerable negotiating power

over them. The same situation exists with a company’s customers if it has a unique product or

service that they cannot readily find elsewhere, so they must agree to abide by the short

payment terms. If a company does not have these advantages, or if competitive pressures do

not allow it to make use of them, the best option left is the reduction of inventory, since this

is an internal issue that is not dependent on the vagaries of suppliers and customers.

[Chandra Prasanna, Financial Management, New Delhi, Tata Mc Graw Hill Publishing

Company Ltd.]

Dell Computer Company has achieved a negative working capital position, which

means it makes money from its working capital. It does this by keeping only a day or two of

inventory on hand and by ordering more from suppliers only when it has specific orders in

hand from customers. In addition, Dell pays its suppliers on longer terms than the terms it

allows its customers, many of whom pay by credit card. The result is an enviable situation in

which this rapidly growing company can not only ignore the cash demands that normally go

along with growth, but actually take in cash from it.

Working capital is not the only drain on cash that a company will experience . It

must also invest in fixed assets, such as office equipment for its staff, production machinery

for the manufacturing operation, and warehouses and trucks for the logistics department.

Although these may seem like unavoidable requirements that are an inherent part of doing

business, there are a few ways to mitigate or even completely avoid these investments. 

Centralize Operations

If a company adds branch offices or extra distribution warehouses, it must invest in

fixed assets for each one. This is a particular concern when extra distribution warehouses are

added, since a company must absorb not only the cost of the building but also the cost of the

inventory inside it. A better approach for a cash-strapped company is to centralize virtually

all operations, even if there is a cost associated with not decentralizing.

For example: shifting to a central warehouse will eliminate the cost of a subsidiary

warehouse, but will increase the cost of deliveries from the central warehouse, assuming that

shipments must now travel a farther distance.

 Rent Or Lease Facilities And Equipment

With so many leasing companies in the market today, as well as manufacturers

financing the lease of their own equipment, a company has a wealth of financing choices that

allow it to avoid the purchase of its facilities and equipment. These arrangements can be a

straight rental, wherein the company has no ownership interest in the assets it uses (also very

similar to an operating lease), or a capital lease, in which the terms of the lease agreement

assume that the company will take possession of the asset being leased at the end of the

payment term. In either of these cases, the total of the rental or lease payments will exceed

the cost of the asset if a company chose to purchase the asset; this is due to the maintenance

and interest costs of the lease supplier, as well as its profit. The main advantage is that there

is no large lump-sum payment required at the time of asset acquisition.

 Outsource Operations

Some portion of every department can be outsourced to a supplier. Although the main

reasons for doing so are related more to strategic and operational issues, you can also make a

strong case for outsourcing because it reduces the need for fixed assets. Here are why:

1. By using outsourcing to avoid the hiring of clerical staff, a company no longer has to

invest in the office space, furniture, or computer systems that they would otherwise

require.

2. Shifting the distribution function to a supplier can completely eliminate a company’s

investment in trucking and warehouse equipment, whereas outsourcing production

will eliminate the massive fixed asset investment that is common for most

manufacturing facilities.

3. Shifting a company’s computer operations to the data processing center of a supplier

will eliminate its investment in its own data processing center, which may be

considerable. By using outsourcing, a company avoids not only an initial investment

in fixed assets but also the update and replacement of those same items.

 Use Partnerships

If a company can enter into a partnership with another company, it may be possible to

use the other company’s assets to transact business. For example: if a drug research company

has a new drug to market, it should enter into a partnership with an established drug

manufacturing firm, so that the research firm does not have to invest in its own production

plant. This arrangement works well for both parties: The research company can avoid

additional cash investments in fixed assets, while the other company can more fully utilize its

existing assets.

If a company brings a particularly valuable patent or process to a partnership, it can use

this to extract a large share of the forthcoming partnership profits, too. This list includes

many cases in which fixed assets could be eliminated, but at the cost of increased variable

costs. Examples of this were heightened distribution costs in exchange for eliminating an

outlying distribution warehouse, renting equipment rather than buying it, and outsourcing

services rather than attempting to operate them in-house. These are acceptable approaches for

many companies, and for several reasons:

1. One is that avoiding the fixed costs associated with a fixed-asset purchase will keep a

company’s total fixed costs lower than would otherwise be the case, which allows it

to have a lower break-even point, so that it can still turn a profit if sales take a turn for

the worse.

2. Also, if there are few and meager funding sources, the added variable costs will not

seem like much of a problem when weighed against the amount of cash that a

company has just avoided investing in fixed assets.

3. Finally, the centralization of operations and use of outsourcing will reduce the amount

of management attention that would otherwise be wasted on the outlying locations

that are now no longer there or the departments that have been shifted to a supplier. In

smaller companies with a dearth of managers, this is a major advantage. [Jain.S.P

and Narang .K.L – Advanced Accounting, Ludhiana, Kalyani Publications,

2000]

FOOT NOTES

Frank Wood & Alan Sangster; Frank Wood's Business Accounting Volume 1, 11th

Edition.

John Dyson ; Accounting for Non-Accounting Students, 8th Edition.

Manish Mittal and Aruna Dhade.

Chandra Prasanna, Financial Management, New Delhi, Tata Mc Graw Hill Publishing

Company Ltd.

Jain.S.P and Narang .K.L – Advanced Accounting, Ludhiana, Kalyani Publications, 2000.

INTRODUCTION TO RESEARCH METHODOLOGY

Research cannot be conducted abruptly. A research has to pass systematically in already

planned direction with the help of a number of steps in sequences. Various steps are involved

in conducting research. All the research conducting steps, when combined together from the

researcher process. If the entire step taker in a systematic manner research conducted

becomes effective.

Nature of Research: Analytical Research

The nature of the research is analytical.

Data Used: Secondary Data

The data used in this research is secondary.

Sources of Data

Balance Sheet of Terumo Penpol Ltd. (2006-2010)

Trading & Profit & Loss Account of Terumo Penpol Ltd. (2006-2010)

Tools for Analysis

Ratio Analysis.

Schedule of Changes in Working Capital.

Comparative Balance Sheet.

Analysing of Zero Working Capital Management

Analysis is the process of identifying the financial strength and weakness of the firm by

properly establishes a relationship between the items of the balance sheet and profit &

loss account. Analysis is used taken by management of the firm or by parties outside the

firm, viz owners, creditors, investors, and other analysis of Zero Working Capital relates

to the examination of circulation, liquidity level, and structural aspects of working capital.

In accounting theory tools namely,

Ratio Analysis.

Schedule of Changes in Working Capital.

Comparative balance Sheet.

RATIO ANALYSIS

Ratio analysis is one of the techniques of financial performance analyze where ratios

are used as a yard stick for evaluating the financial condition and performance of a firm.

Analysis and interpretation of various accounting ratios gives a skilled and experienced

analyst, a better understanding of the financial condition and performance of the firm than be

could have to obtained only through a perusal of financial statements. Ratios are relationships

expressed in mathematical terms between figures, which are connected with each other in

some manner.

Ratio is a simple arithmetical expression of the relationship of one number to

another. It may be defined as the indicated quotient of two mathematical expressions.

According to Accountantan’st Hand book by Wixon, Kell and Bedford, a ratio “is an

expression of the quantitative relationship between two numbers”. In simple language ratio is

one number expressed in the terms of another and can be worked out by dividing one number

into the other.

ANALYSIS OF SHORT TERM FINANCIAL POSITION OR TEST OF LIQUIDITY.

1. LIQUIDITY RATIOS

Liquidity ratio plays the key role in determining the short

 term financial position of a business.

1.1, Current ratio

                    It is also known as working capital ratio. It shows the relation between the total

current assets and current liabilities. Standards ratio is 2:1. It measures the short-term

solvency.

           Current ratio=   Current assets      

                                     Current liabilities

1.2, Quick ratios

                   Quick ratio means the ratio of quick assets to quick liabilities. It is concerned

with quick assets and quick liabilities. This ratio is otherwise called acid test ratio or liquidity

ratio.

                         

  Quick assets or liquid assets

Quick ratio=            current liabilities

                    the term quick asset refers to current assets which can be converted in to cash

quickly. It comprises all current assets except stock and prepaid expenses. It measures the

firm’s capacity to pay off its obligations immediately. The standard ratio is 1:1. A higher

ratio indicates the sound financial position and vice versa.

                                Quick ratio includes sundry debtors, cash and bank balance, other current

assets and loans and advances except inventories. Current liabilities include liabilities,

proposed dividends, provision for dividend and provision for taxation.

1.3, Absolute liquid ratio

                                Absolute liquidity is represented by cash and near cash items. Hence, in

the computation of this ratio, only absolute liquid assets are compared with liquid liabilities.

                                           cash+ bank + marketable securities   

Absolute liquid ratio=        liquid liabilities  

                      In absolute liquid ratio involved only the assets of cash, bank and marketable

securities.

A standard of 0.5: 1 is considered on acceptable norm for the ratio. This is also known as

position ratio.

1.4, Net working capital ratio

                       Net working capital ratio of affirm is finding through at comparing the net

working capital and net assets of a firm, it indicates  how much net working capital to net

assets.

                                          Net working capital

Working capital ratio=            Net assets 

Net working capital=Current assets - current liabilities

TURN OVER RATIO

1.1, Capital Turnover Ratio

This ratio indicates the sales to capital employed.

                                            Net sales

Capital turnover ratio=     Capital employed

Capital employed = share holder fund +reserves and surplus + long term liabilities.

1.2, Total Assets Turnover Ratio

                                  This ratio relates to total assets to net sales. It helps to find out the

productivity of the total assets. The formula for ascertaining total asset turnover ratio is :

                                                 Net sales

Total assets turnover ratio =  Total assets

1.3, Working Capital Turnover Ratio.

                                       

It establishes relationship between the sales to net working capital. This ratio indicates the

efficiency of working capital utilization.

The purpose of finding this ratio is to point out what extend the working capital is rotated in

the business within a period of one year.

                                                         

    Sales

Working capital turnover ratio =  Net working capital

PROFITABILITY RATIOS

The profitability ratios are calculated by relating profits either to sales or to investment.

Profitability ratios are based on sales of the firm.

1.  Gross profit ratio

     Gross profit ratio of gross profit to net sales expressed as a percentage. It

expresses the relationship between gross profit margins and sales.Gross profit is the ultimate

result of interaction between the prices, sales, volume and cost. Changes in gross profit can

be affected by changes in any of these factors.

Gross profit ratio = Gross profit 

                                 Net sales

Gross profit = sales - cost of good sold

2.  Net profit ratio

        This is the ratio of net income or profit after taxes to net sales. This is used as a measure

of over all profitability and is useful to the owners. It is both an index of  efficiency as well as

the profitability of the firm.

                                 Net profit

Net profit ratio=      Net sales                               

Net profit= Sales-(production expenses + interest + depreciation + taxes)

Comparative Balance Sheet Analysis

Comparative Financial Statement Analysis:- Reviewing consecutive balance sheets, income

statements, or statements of cash flows from period to period. This usually involves a review of

changes in individual account balances on a year-to-year and multiyear basis. Comparative

analysis also compares trends in related items. Comparative financial statement analysis also is

referred to as horizontal analysis given the left-right (or right-left) analysis of account balances

as we review comparative statements. Two techniques of comparative analysis are especially

popular: year-to-year change analysis and index number trend analysis.

Tools for Representation

Tables

Charts

                             

ANALYSIS AND INTERPRETATION

4.1 RATIO ANALYSIS

4.1.1 Current Ratio

Current Ratio may be defined as the ratio of current asset to current

liabilities. It is also called Working Capital Ratio. Standards ratio is 2:1. It measures

the short-term solvency.

Current ratio=   Current assets      

                          Current liabilities

Table 4.1.1 (In lakhs)

Year Current Asset Current Liability Ratio

2005-2006 2716 799 3.4

2006-2007 2800 974 2.9

2007-2008 2662 1346 2

2008-2009 6500 1814 3.6

2009-2010 4959 1918 2.6

Chart 4.1.1

Current Ratio

0

0.5

1

1.5

2

2.5

3

3.5

4

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

Years

rati

o

Ratio

Interpretation:

The ideal current ratio is 2:1. In all the years, the current ratio is above

standard. The current asset shows an increasing trend. In 2008-2009 the ratio is high

due to high cash and bank balances. In 2007-2008 the ratio seems to be optimal.

While comparing with previous year 2008-2009 the current asset has been increased

and current liability has been decreased.

4.1.2 Absolute Liquid Ratio

Absolute liquidity is represented by cash and near cash items. Hence, in the computation of

this ratio, only absolute liquid assets are compared with liquid liabilities.

                                           cash+ bank + marketable securities   

Absolute liquid ratio=        liquid liabilities  

A standard of 0.5: 1 is considered on acceptable norm for the ratio. This is also known as

position ratio.

Table 4.1.2 (In lakhs)

Year Absolute liquid

asset

Current Liability Ratio

2005-2006 961 799 1.2

2006-2007 744 974 .76

2007-2008 557 1346 .41

2008-2009 3217 1814 .18

2009-2010 1330 1918 .69

Chart 4.1.2

Absolute Liquid Ratio

0

0.2

0.4

0.6

0.8

1

1.2

1.4

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

Years

Rat

io Ratio

Interpretation:

In the year 2005-2006 and 2006-2007, the firm’s state of affairs shows an absolute

ratio of 1.2:1and 0.76:1. The standard ratio is 0.5:1and the organization having absolute

liquid ratio that is above the standard ratio and firm having a satisfactory position. In the year

2007-2008 and 2008-2009, the firm’s state of affairs shows an absolute ratio of 0.41:1 and

0.18:1 respectively. The organization having absolute liquid ratio that is below the standard

ratio and firm is showing a weak position.

4.1.3 Liquid Ratio

Quick ratio means the ratio of quick assets to quick liabilities. It is concerned with

quick assets and quick liabilities. This ratio is otherwise called acid test ratio or liquidity

ratio.                     

  Quick assets or liquid assets

Quick ratio=         current liabilities

It measures the firm’s capacity to pay off its obligations immediately. The standard ratio is

1:1. A higher ratio indicates the sound financial position and vice versa.

Table 4.1.3 (in lakhs)

Year Quick Asset Current Liability Ratio

2005-2006 2208 799 3

2006-2007 2253 974 2.3

2007-2008 1986 1346 1.5

2008-2009 5263 1814 3

2009-2010 3636 1918 2

Chart 4.1.3

Liquid Ratio

0

0.5

1

1.5

2

2.5

3

3.5

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

Years

Rat

io Ratio

Interpretation:

In the year 2005-2006, the firm is having a liquid ratio 3:1. The standard ratio is 1:1 and the

firm having strong liquid ratio for balancing the assets and liabilities. In the year 2006-2007,

the firm is having a liquid ratio 2.3:1. The standard ratio is 1:1 and the firm is having for its

operation. In the year 2007-2008, the firm is having a liquid ratio 1.5:1. The standard ratio is

1:1 and the firm is having better liquid ratio comparing to standard for its operation.

4.1.4 Net Working Capital Ratio

                       Net working capital ratio of affirm is finding through at comparing the

net working capital and net assets of a firm, it indicates  how much net working

capital to net sales.

                                         Net Sales

Working capital ratio=    Net working capital 

Net working capital=Current assets - current liabilities

Table 4.1.4 (in lakhs)

Year Net Sales Net Working

Capital

Ratio

2005-2006 4517 1916 2.35

2006-2007 5366 1826 3

2007-2008 5434 1316 4.12

2008-2009 7734 4685 1.65

2009-2010 9355 3040 3.07

Chart 4.1.4

Net Working Capital Ratio

00.51

1.52

2.53

3.54

4.5

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

Years

Rat

io Ratio

Interpretation:

A higher ratio represents efficient utilization of working capital and a low ratio represents

otherwise. In the year 2007-2008 & 2009-2010 the firm is holding a net working capital ratio

which is high 4.12 & 3.07 respectively, ie, shows effective utilization of working capital. In

the year 2008-2009 the firm is having a least working capital ratio.

4.1.5 Capital Turnover Ratio

This ratio indicates the sales to capital employed.

                                            Net sales

Capital turnover ratio=     Capital employed

Capital employed = share holder fund +reserves and surplus + long term liabilities.

Table 4.1.5 (in lakhs)

Year Net Sales Capital Employed Ratio

2005-2006 4517 1879 2.40

2006-2007 5366 3549 1.51

2007-2008 5434 3479 1.56

2008-2009 7734 6912 1.11

2009-2010 9355 8269 1.13

Chart 4.1.5

Capital Turnover Ratio

0

0.5

1

1.5

2

2.5

3

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

Years

Rat

io Ratio

Interpretation:

In the year 2005-2006, the firm’s capital turnover ratio 2.4:1. i.e., net sales amount

is twice than the capital employed. So the firm is having higher turnover on its capital

employed. The capital turnover ratio is satisfactory. In the year 2005-2006, the firm’s capital

turnover ratio 1.51:1, i.e., net sales amount is comparatively higher than the capital

employed. So firm is having increased turnover on capital employed. Capital turnover ratio is

favourable. In the year 2008-2009, the firm’s capital turnover ratio 1.11:1, ie. Net sales

amount shows a little increase than the capital employed. So the firm is having capital

turnover ratio which is not so favourable.

4.1.6 Total Assets Turnover Ratio

                                  This ratio relates to total assets to net sales. It helps to find out

the productivity of the total assets. The formula for ascertaining total asset turnover

ratio is :

                                                 Net sales

Total assets turnover ratio =  Total assets

Table 4.1.6 (in lakhs)

Year Net Sales Total Asset Ratio

2005-2006 4517 4402 1.02

2006-2007 5366 4641 1.15

2007-2008 5434 4925 1.10

2008-2009 7734 8784 0.88

2009-2010 9355 10212 0.91

Chart 4.1.6

Total Asset Turnover Ratio

0

0.2

0.4

0.6

0.8

1

1.2

1.4

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

Years

Rat

io Ratio

Interpretation:

From the year 2005-2006 to 2007-2008 total assets turnover ratio shows an increasing

trend which seems to be consistent & in 2008-2009 it shows a diminishing fluctuation and in

2009-2010 it shows an increasing trend. As per Total Assets Turnover, total assets shows

satisfactory productivity.

4.1.7 Working Capital Turnover Ratio

It signifies that for an amount of sales, a relative amount of working capital is needed.

It may thus compute net working capital turnover by dividing sales by working capital.

Working Capital Turnover Ratio= Sales/Net working capital

Table 4.1.7 (in lakhs)

Year Sales Net WC Ratio

2005-2006 4517 1968 3

2006-2007 5366 1826 3

2007-2008 5434 1316 4.12

2008-2009 7734 4685 1.65

2009-2010 9355 3040 3.07

Chart 4.1.7

Working Capital Turnover Ratio

00.51

1.52

2.53

3.54

4.5

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

Years

Rat

io Ratio

Interpretation:

Working Capital Turnover Ratio of the firm is likely to be good as it is increasing and

maintaining a constant position. In 2007-2008 working capital ratio is high i.e., 4.12 and in

2008-2009 it shows a least value. But in 2009-2010 it is emerging to 3.07 i.e., betterment of

the situation.

4.1.8 Gross Profit Ratio

     Gross profit ratio of gross profit to net sales expressed as a percentage. It

expresses the relationship between gross profit margins and sales. Gross profit is the ultimate

result of interaction between the prices, sales, volume and cost. Changes in gross profit can

be affected by changes in any of these factors.

Gross profit ratio = Gross profit 

                                 Net sales

Gross profit = sales - cost of good sold

Table 4.1.8 (in lakhs)

Year Gross Profit Net Sales Ratio

2005-2006 1204 4517 0.26

2006-2007 1944 5366 0.36

2007-2008 7363 5434 1.35

2008-2009 2169 7734 0.28

2009-2010 2126 9355 0.22

Chart 4.1.8

Gross Profit Ratio

0

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

Years

Rat

io Ratio

Interpretation:

As per analysis, in the year 2007-2008 only the firm is having fair gross profit ratio

and in the rest of the financial periods the gross profit ratio shows downward fluctuation

which was affected by the factors price, volume, sales and cost.

4.1.9 Net Profit Ratio

        This is the ratio of net income or profit after taxes to net sales. This is used as a measure

of over all profitability and is useful to the owners. It is both an index of  efficiency as well as

the profitability of the firm.

                                 Net profit

Net profit ratio=      Net sales                               

Net profit= Sales-(production expenses + interest + depreciation + taxes)

Table 4.1.9 (in lakhs)

Year Net Profit Net Sales Ratio

2005-2006 2053 4517 0.45

2006-2007 2468 5366 0.45

2007-2008 2484 5434 0.45

2008-2009 3296 7734 0.42

2009-2010 3829 9355 0.40

Chart 4.1.9

Net Profit Ratio

0.370.380.390.40.410.420.430.440.450.46

2005-2006 2006-2007 2007-2008 2008-2009 2009-2010

Years

Rat

io Ratio

Interpretation:

From the year 2005-2006 to 2007-2008, the firm shows a consistent ratio of net profit and in

2008-2009 and in the year 2009-2010 the net profit ratio shows a downward trend to the firm

comparing to previous years.

4.2 SCHEDULE OF CHANGES IN WORKING CAPITAL

The statement of Changes in Working Capital or simply called “Working Capital

Statement” is prepared with the help of current asset and current liabilities.

Table 4.2.1

Schedule of changes in working capital for the year 2005-2006 and 2006-2007

(Rs in lakhs)

Statement of changes in working capital for the year 2005-2006 and 2006-2007

Particulars 2005-2006 2006-2007 Changes in WC

Increase Decrease

A) Current Assets

Inventories 509.1 547.6 38.5

Sundry Debtors 969.1 1159.3 189.8

Cash & Bank balances 961.3 744.7 216.6

Loans & Advances 276.5 349.2 72.7

Total of A 2716.4 2800.8

B) Current Liabilities

Current Liabilities 748.3 831.9 83.6

Provisions 51.2 142.9 91.7

Total of B 799.5 974.8

Total (A-B) 1916.9 1826

Net decrease in WC 90.9 90.9

Total 1916.9 391.9 391.9

Interpretation:

Here the current asset is more than the current liabilities. In 2006-2007, there is an

increase in current assets, inventory and debtors is also increased by 38.5 lakh & 189.8 lakh.

Moreover the cash & bank balances have also being decreased by 216.6 lakh. Current

liability along with the provisions has also been increased by 83.6 lakh and 91.7 lakh which is

a good sign to firm. As the amt of inventory & debtors has been decreased it shows under

utilization of current assets & cash balance is not enough to manage the day-to-day activities

of the organization.

Table 4.2.2

Schedule of changes in working capital for the year 2006-2007 and 2007-2008

(Rs in

lakhs)

Statement of changes in working capital for the year 2006-2007 and 2007-2008

Particulars 2006-2007 2007-2008 Changes in WC

Increase Decrease

A) Current Assets

Inventories 547.6 676.3 128.7

Sundry Debtors 1159.3 1103.4 55.9

Cash & Bank balances 744.7 557 187.7

Loans & Advances 349.2 326 23.2

Total of A 2800.8 2662.7

B) Current Liabilities

Current Liabilities 831.9 1165.9 334

Provisions 142.9 180.7 37.8

Total of B 974.8 1346.6

Total (A-B) 1826 1316.1

Net decrease in WC 509.9 509.9

Total 1826 1826 638.6 638.6

Interpretation:

Here the current assets is more than the current liabilities. In 2007-2008, there is an

increase in current assets, inventory is increased by 128.7 lakh & debtors decreased by 55.9

lakh. Moreover the cash & bank balances have also being decreased by 187.7 lakh. Current

liability along with the provisions has also been increased by 334 lakh and 37.8 lakh which is

a good sign to firm. As the amt of cash balance & debtors has been decreased it shows under

utilization of current assets & cash balance is not enough to manage the day-to-day activities

of the organization..

Table 4.2.3

Schedule of changes in working capital for the year 2007-2008 and 2008-2009

(Rs in lakhs)

Statement of changes in working capital for the year 2007-2008 and 2008-2009

Particulars 2007-2008 2008-2009 Changes in WC

Increase Decrease

A) Current Assets

Inventories 676.3 1237.2 560.9

Sundry Debtors 1103.4 1820.8 717.4

Cash & Bank balances 557 3217.8 2660.8

Loans & Advances 326 224.6 101.4

Total of A 2662.7 6500.4

B) Current Liabilities

Current Liabilities 1165.9 1650 484.1

Provisions 180.7 164.9 15.8

Total of B 1346.6 1814.9

Total (A-B) 1316.1 4685.1

Net increase in WC 3369 3369

Total 4685.1 4685.1 3954.5 3954.5

Interpretation:

Here the current assets is more than the current liabilities. In 2008-2009, there is an

increase in current assets, inventory is increased by 560.9 lakh & debtors increased by 717.4

lakh. Moreover the cash & bank balances have also being increased by 2660.8 lakh. Current

liability decreased by 484.1 lakh & the provisions has also been increased by 15.8 lakh which

is a good sign to firm. As the amt of cash balance & debtors has been increased it shows

proper utilization of current assets & cash balance is enough to manage the day-to-day

activities of the organization. In short the firm shows a sound working capital fund for its

operation.

Table 4.2.4

Schedule of changes in working capital for the year 2008-2009 and 2009-2010

(Rs in lakhs

Statement of changes in working capital for the year 2008-2009 and 2009-2010

Particulars 2008-2009 2009-2010 Changes in WC

Increase Decrease

A) Current Assets

Inventories 1237.2 1322.9 85.7

Sundry Debtors 1820.8 1936.0 115.2

Cash & Bank balances 3217.8 1330.3 1887.5

Loans & Advances 224.6 369.7 145.1

Total of A 6500.4 4958.9

B) Current Liabilities

Current Liabilities 1650 1634.3 15.7

Provisions 164.9 284.3 119.4

Total of B 1814.9 1918.6

Total (A-B) 4685.1 3040.3 361.7 2006.9

Net decrease in WC 1645.2 1645.2

Total 4685.1 4685.1 2006.9 2006.9

Interpretation:

Here the current asset is more than the current liabilities. In 2008-2010, there is an

increase in current assets, inventory is increased by 85.7 lakh & debtors increased by 115.2

lakh. Moreover the cash & bank balances have also being increased by 1887.5 lakh. Current

liability increased by 15.7 lakh & the provisions has also been increased by 119.4 lakh which

is a good sign to firm. As the amt of inventory & debtors has been increased it shows proper

utilization of current assets & cash balance is not enough to manage the day-to-day activities

of the organization.

4.3 COMPARATIVE BALANCE SHEET

Table 4.3.1

Comparative Balance Sheet for the tear 2005-06 and 2006-07 (Rs in lakhs)

Particulars 2005-06 2006-07 +/- Rs +/- %

Inventories 509.1 547.6 38.5 7.6

Sundry Debtors 969.5 1159.3 189.8 19.6

Cash and bank balances

961.3 744.7 (216.6) (22.5)

Loans and advances

276.5 349.2 72.7 26.3

Cl and prov 799.5 974.8 175.3 21.9

NWC 1916.7 1826 (90.7) (4.7)

Operating Fixed Assets

1664 1649.6 (14.4) (0.9)

Total operating assets

3580.1 3475.6 (104.5) (2.9)

Capital work in progress

20.8 190.5 169.7 89

Miscellaneous expences

141 - (141) (100)

Total assets 3743.2 3666.1 (77.1) (2.1)

Shareholders fund

1873.1 2316.3 443.2 23.7

Long term fund 1731.3 1233.5 (497.8) (28.8)

Deffered tax liability

138.8 116.3 (22.5) (16.2)

Total liability 3743.2 3666.1 (77.1) (2.1)

Interpretation:

1) In the year 2006-2007, the inventory has been increased by 7.6% than in 2005-2006.

2) Sundry debtors have been increased by 19.6% in 2006-2007 than in the previous year.

3) In the year 2006-2007 the cash balance was decreased by 22.5% comparing to

previous year 2005-2006.

4) Loans & advances have been increased by 26.3% in the year 2006-2007.

5) Total operating assets was decreased by 2.9% compared to previous year 2005-2006.

6) Net working capital was decreased by 4.7% in 2006-2007 than in previous year.

7) Share holders fund was increased by 23.7% in the year 2006-2007 comparing to

preceeding year.

8) Long term fund was decreased by 28.8% in the year 2006-2007.

Table 4.3.2

Comparative Balance Sheet for the tear 2006-07 and 2007-08

(Rs in lakhs)

Particulars 2006-07 2007-08 +/- Rs +/- %

Inventories 547.6 676.3 128.7 23.5

Sundry Debtors 1159.3 1103.4 (55.9) (4.8)

Cash and bank balances

744.7 557 (187.7) (25.2)

Loans and advances

349.2 326 (23.2) (6.6)

Total ca, loans, and adv

2800.8 2662.7 (138.1) (4.9)

Cl and prov 974.8 1346.6 371.8 38.1

NWC 1826 1316.1 (509.9) (27.9)

Operating Fixed Assets

1649.6 2152.9 503.3 30.51

Total operating assets

3475.6 3469 (6.6) (2)

Capital work in progress

190.5 109.2 81.3 (42.7)

Total assets 3666.1 3578.2 (87.9) (2.4)

Shareholders fund

2316.3 2916.4 600.1 25.9

Long term fund 1233.5 563.4 (670.1) (54.3)

Deffered tax liability

116.3 98.5 (17.80) (15.3)

Total liability 3666.1 3578.2 (87.9) (2.4)

Interpretation:

1) In the year 2007-2008, the inventory has been increased by 23.5% than in 2006-2007.

2) Sundry debtors have been decreased by 4.8% in 2007-2008 than in the previous year.

3) In the year 2007-2008 the cash balance was decreased by 25.2% comparing to

previous year 2006-2007.

4) Loans & advances have been decreased by 6.6% in the year 2007-2008.

5) Total operating assets was decreased by 2% compared to previous year 2006-2007.

6) Net working capital was decreased by 27.9% in 2007-2008 than in previous year.

7) Share holders fund was increased by 25.9% in the year 2007-2008 comparing to

preceding year.

8) Long term fund was decreased by 54.3% in the year 2007-2008.

Table 4.3.3

Comparative Balance Sheet for the tear 2007-08 and 2008-2009

(Rs in lakhs)

Particulars 2007-08 2008-2009 +/- Rs +/- %

Inventories 676.3 1237.2 560.9 82.9

Sundry Debtors 1103.4 1820.8 717.4 65

Cash and bank balances

557 3217.8 2660.8 82.7

Loans and advances

326 224.6 (101.4) (31.1)

Total ca, loans, and adv

2662.7 6500.4 3837.7 59.04

Cl and prov 1346.6 1814.9 468.3 34.8

NWC 1316.1 4685.1 3369 72

Operating Fixed Assets

2152.9 2126.3 (26.6) (1.2)

Total operating assets

3469 6811.4 3342.4 96.4

Capital work in progress

109.2 157.2 48 44

Total assets 3578.2 6968.9 3390.7 94.8

Shareholders fund

2916.4 3974.8 1058.4 36.3

Long term fund 563.4 2937.6 2374.2 81

Deffered tax liability

98.5 56.5 (42) 42.6

Total liability 3578.2 6968.9 3390.7 94.8

Interpretation:

1) In the year 2008-2009, the inventory has been increased by 82.9% than in 2007-2008.

2) Sundry debtors have been increased by 65% in 2008-2009 than in the previous year.

3) In the year 2008-2009 the cash balance was increased by 82.7% comparing to

previous year 2007-2008.

4) Loans & advances have been decreased by 31.1% in the year 2008-2009.

5) Total operating assets was increased by 96.4% compared to previous year 2007-2008.

6) Net working capital was increased by 72% in 2008-2009 than in previous year.

7) Share holders fund was increased by 36.3% in the year 2008-2009 comparing to

preceding year.

8) Long term fund was increased by 81% in the year 2008-2009.

Table 4.3.4

Comparative Balance Sheet for the tear 2008-09 and 2009-2010

(Rs in lakhs)

Particulars 2008-09 2009-2010 +/- Rs +/- %

Inventories 1237.2 1322.9 85.7 7.0

Sundry Debtors 1820.8 1936.08 115.28 6.33

Cash and bank balances

3217.8 1330.3 (1887.5) (58.65)

Loans and advances

224.6 369.72 145.12 64.6

Total ca, loans, and adv

6500.4 4959.1 (1541.3) (23.7)

Cl and prov 1814.9 1918.7 103.9 5.7

NWC 4685.1 3040.4 (1644.7) (35.1)

Operating Fixed Assets

2126.3

Total operating assets

6811.4

Capital work in progress

157.2

Total assets 6968.9 10212.7 3243.8 46.5

Shareholders fund

3974.8 5099.03 1124.23 28.28

Long term fund 2937.6 3170.01 232.41 7.9

Deffered tax liability

56.5 25.02 (31.48) (55.7)

Total liability 6968.9

Interpretation:

a. In the year 2009-2010, the inventory has been increased by 7% than in 2008-

2009.

b. Sundry debtors have been increased by 6.3% in 2009-2010 than in the

c. In the year 2009-2010 the cash balance was decreased by 58.65% comparing

to previous year 2008-2009.

d. previous year.

e. Loans & advances have been increased by 64.6% in the year 2009-2010.

f. Net working capital was decreased by 35.1% in 2009-2010 than in previous

year.

g. Share holders fund was increased by 28.28% in the year 2009-2010 comparing

to preceding year.

h. Long term fund was increased by 8% in the year 2009-2010

CHAPTER V

FINDINGS, SUGGESTIONS, AND CONCLUSIONS

Chapter V

FINDINGS, SUGGESTIONS, AND CONCLUSIONS

5.1 Findings.

1. Working Capital increased because of increase in the current asset is more than increase in the current liability.

2. The company was redeeming 10% preference share in the last year 2009-2010.3. In the year 2006-2007 working capital decreased because of increased price of raw material and

manufacturing expenses due to higher inflation rate.4. Current assets are more than current liabilities indicate that company used long term funds for short

term requirement, where long term funds are most costly than short term funds.5. Company’s current assets were always more than requirement it affect the profitability of the

company.6. Terumo Penpol is non-demand based company. Hence the concept of zer working capital is not

applicable.

5.2 Suggestions

1. Company should raise the funds through short term sources for short term requirement of funds, which comparatively economical as compare to long term funds.

2. Company should take control on debtor’s collection period which is major part of current assets.3. Company has to take control on cash balance because cash is non earning assets and increasing cost of

funds.4. In order to avoid the uncertainties associated with the supply of raw materials. The company should

have a better supplier chain.

5.3 Conclusions

The company is one of the largest producers of blood bags in Asia. Driven by its strong

customer – focus and innovative spirit, the company has been the market leader. When the working

capital management of the company was analyzed, the company has good liquidity position and

sufficient funds to repayment of liabilities. As inventory was imported, the company holds inventory

as a precautionary motive. The company has to redeem 10% preference share in the last year. So it is

difficult for the company to implement zero working capital system. Company has accepted

conservative financial policy and thus maintaining more current assets balance. Company is increasing

sales volume per year which supports its growth.

BIBLIOGRAPHY.

I.M Pandey., Financial Management, New Delhi, Vikas Publishing House Pvt.Ltd, 2005.

Bhattachar

APPENDIX

Appendices 1

Balance Sheet

(Rs in lakhs)

Particulars 2005-06 2006-07 2007-08 2008-09 2009-10CAInventories 509.1 547.6 676.3 1237.2 1322.9Sundry Debtors 969.5 1159.3 1103.4 1820.8 1936.08Cash and bank balances

961.3 744.7 557 3217.8 1330.3

Loans and advances

276.5 349.2 326 224.6 369.72

Total CA, loans, and advances

2716.4 2800.8 2662.7 6500.4 4959.1

CL and provisions

799.5 974.8 1346.6 1814.9 1918.7

NWC 1916.7 1826 1316.1 4685.1 3040.4Operating Fixed Assets

1664 1649.6 2152.9 2126.3 5253

Total operating assets

3580.1 3475.6 3469 6811.4 10212

Capital work in progress

20.8 190.5 109.2 157.2 88.5

Miscellaneous expenses

141 - - -

Total assets 3743.2 3666.1 3578.2 6968.9 102121.7Shareholders

fund1873.1 2316.3 2916.4 3974.8 5099.03

Long term fund 1731.3 1233.5 563.4 2937.6 3170.01Deferred tax liability

138.8 116.3 98.5 56.5 25.02

Total liability 3743.2 3666.1 3578.2 6968.9 10212.7