atul auto limited-2
TRANSCRIPT
AN
INDUSTRIAL VISIT REPORT
ON
PREPARED BY
PARVADIYA ASHISH
CLASS
F.Y.B.B.A.
ACADEMIC YEAR
2007-2008
ROLL NO . SEAT NO.
COLLEGE
GUIDED BY
SUBMITTED TO
DECLARATION
I undersigned XXXXXXXXXXXX a student of Second Year
Bachelor of Business Administration, here by declare that the project –
work presented in this report is my own work and has been carried out
under the supervision of xxxxxxxxxxxxxxxx of
xxxxxxxxxxxxxxxxxx
This work has not been previously submitted to another
university for any examinations.
Date: -
Place: -
Signature
(xxxxxxxxxxxxxx )
PREFACE
Practical studies important in almost all aspects of human life
keeping this in view the S.P.University has included the subject of
practical studies in Bachelor of Business Administration. In S.Y.B.B.A.
the objective of Industrial visit is to give a respective about the
organization and functioning in an industrial unit.
It is quite interesting to know practically the aspects of the
working of a manufacturing unit. The unit I visited was ATUL AUTO
LTD., a leading manufacturer of two or three wheeler commercial
vehicles.
After the visit I have learnt a lot and have carefully collected the
information which is presented here in the best possible manner and to
the best of my ability. I am sure this would enhance my knowledge
about business practice and management in various fields of Business
Administration.
ACKNOWLEDGEMENTIt is my great pleasure to present this report before you. I
sincerely thank all officers and staff of ATUL AUTO LTD. for their co-
operation during the visit and for providing me the essential details of
the working of the company.
I am also thankful to Dr. Ajayraj M. Vyas for guiding me through
out the preparation of this report and for her valuable suggestions.
I would also like to thank our Principal, My Brother, My Last but
not the least Parents, My Classmates and my friends for their
encouragement and support during the work.
I have tried my level best to present the available information in
the best possible manner.
Date: -
Place: - RAJKOT
Signature
(PARVADIYA ASHISH)
GENERAL INDEXSr. No. Particulars Page No.
1 General Information
2 Production Department
3 Personnel Department
4 Marketing Department
5 Finance Department
6 SWOT Analysis
7 Future Plans
8 Suggestions
9 Conclusion
10 Bibliography
CONTENTSSr. No. Particulars Page No.
1 History & Development
2 Company Profile
3 Organization Structure
HistoryThe unit was initially set up at Jamnagar as a Private limited
company on 18th June 1986, under the companies Act 1956. It was
registered with the registrar of companies of Maharashtra State and later
on transferred its registered office to Gujarat state on 21st January 1992,
at Jamnagar City.
The company purchased land at Jamnagar & undertook the
project however, due to their failure to avail basic infrastructure
facilities like electricity at Jamnagar the promoters decided to shift their
location to Shapar (Veraval) village of Rajkot. they started the unit there
on 1st May 1992. These after, on 12th August 1997 finally the company
was converted into public limited company as ATUL AUTO LIMITED.
The promoters of the company are Shri Jayantibhai J. Chandra,
late Shri Atul J. Chandra and Shri Mahendra Patel. They all are leading
industrialists with vast experience of trade and industry.
Company Profile(a) Name of Company : ATUL AUTO LTD.
(b) Corporate Office
Address
: “Jimmy Tower”,
Opp. Swaminarayan Gurukul,
Gondal Road,
RAJKOT – 360 002.
(c) Registered Office
Address
: Survey No. 86,
Plot No. 1 to 4, N. H. 8-B,
Tal.: Kotda Sangani,
Shapar (Veraval),
RAJKOT – 360 004.
(d) Year of Establishment : 1st May 1992
(e) Year of Commencement : 1st May 1992
(f) Main Products : Automobiles (Three Wheelers)
(g) Production Capacity : 1500 Units (Monthly)
(h) Form of Organization : Joint Stock Company
(i) Size of Unit : Large Scale Unit
(j) Names of Promoters : Shri J. J. Chandra
Shri Atul J. Chandra
Shri Mahendra Patel.
(k) Board of Directors
Shri J. J. Chandra
Shri N. J. Chandra
Shri M. J. Patel
Shri R. H. Druva
Shri R. S. Kukreja
Shri S. T. Kaneria
:
:
:
:
:
:
:
Chairman & Managing
Director
Whole Time Director
Joint Managing Director
Director
Director
Director
(l) Auditors : M/s. Maharishi & Co.
Chartered Accountants
JAMNAGAR.
(m)
Total Area Covered : 10 acres.
(n) Bankers : State Bank of India
(o) Brand Name : ATUL SHAKTI
Organization StructureATUL AUTO LTD. is a large scale company and this has a
vast organization structure. The company has established a network
of over hundred dealers all over India and abroad.
The organization structure of the company is based on the
principles of modern scientific management.
The organization structure in detail is given on the next
page.
CONTENTSSr. No. Particulars Page No.
1 Introduction
2 Organization Structure
3 Production Planning & Control
4 Raw Material
5 Production Process
6 Plant Location
7 Plant Layout
8 Inventory Control
9 Pollution Control
10 Quality Control
11 Scrap & Waste Management
12 Stores Management
13 Material Handling
IntroductionProduction department is one of the most important departments
of any industrial unit. Without this department all the other departments
are of no use to the company. Production means the conversion of raw
materials into finished products with the help of certain processes. The
aim of any production system is to produce the desired goods & services
effectively & efficiently.
In automobile manufacturing unit should be well versed in terms
of technology and equipment to give the best products to its consumers
and stay ahead of the competition. Also the scale of production should
be large to avail benefits of mass production at both ends of production
as well as sales.
Organization StructureThe organization structure is very important in the production
department. It clarifies the positions of every employees and the
employees come to know what they are expected to do at different
levels.
ATUL AUTO LTD. has a separate production department. Mr.
M. H. Desai is the head of the department.
Chart of Production
Department
M.D.
J.M.D.
D.G.M. (Production)
Manager (Production)
Asst. Mgr.(M&C)
Asst. Mgr.(Assm)
Sr. Eng(PDI)
Sr. Eng(F/S)
P.S(I.C.)
Sr. Eng.(Planning
)
Sr. Eng.Ind. & Cost
Sr. Engr. Mechanics
Mechanics
Line Insp. Sr. Tech.
Painters
Jr. Engr. Asst. Mech
HelperWelder Fitter
Helper
Helper
HelperTr. Engr.
Line Insp.
Operator
Helper
Production Planning &
ControlThe planning and control of production is one of the important
problems of production management. It is essential that production is
carried on in the best manner at the lowest cost, and the goods are of the
right quality and are produced at the proper time. This can be ensured
only through proper planning of production.
Production control is concerned with direction and guiding
production along the lines set up by the planning department. It
evaluates the actual performance of the productive apparatus in the light
of plans formulated by the planners.
In ATUL AUTO LTD., there is a coordination committee for this
function. It is done in accordance with demand in market. Production
planning is done by the head of the production department. He plans
every thing with the help of supervisors. Production control is all in the
hands supervisors and the head of the production department. Although
the ultimate authority is held by the managing directors and other board
of directors and it is delegated to the head of production department (Mr.
M. H. Desai).
Raw MaterialRaw materials means the materials which are used for the
production process. Raw materials includes the materials obtained from
land forest etc. It also includes semi – finished goods used in the
manufacturing process of any product.
ATUL AUTO LTD., use raw materials like bright bars, steel
sheets, pipes, engine oils, balls – bearings, etc. The unit mostly
purchases these materials from Ahmedabad depo (TATA). It also uses
semi – finished products like headlights, wires, handles. It purchases
these products from various places like Aurangabad, Delhi, Ahmedabad,
& Rajkot.
Production ProcessProduction process is a process of conversion of various to satisfy
the needs of the customers. The difference between the value of inputs
and outputs represents the contribution of the production process. It
converts the raw materials into finished goods and there by increases its
utility.
The production process of three wheeler vehicles produced by
ATUL AUTO LTD., can be described as follows:
In the first phase the aluminum chassis are made with the help of
welding & casting machines. This chassis is the base of the
product. The company maintains a two days stock of these
chassis in the chassis department. So in case of power – failure,
there is no shortage of chassis in the production process.
In the second phase the assembling of various components is
made. They fix the wheels, floor and front show. The front show
of the vehicles is procured from MITASO COMPANY. For
fixing these components, nut balls are used. Which are tapped
with the help of guns. Then spray painting of the front show is
made. At present the spray painting is done manually but they are
planning to use automatic machines for this work in future. The
machine (engine) is also attached in this phase.
The sub – assembly of the machine includes gear box, adapter
and C. C. Plague. The gear box cover is procured from Ambala.
These components are aligned properly with studs and nuts. This
machine (engine) is the most important part of the vehicle.
The next phase includes, passing the units from the manual
trollies to the conveyer belt on which they fix the shaft the
driver’s sear, the front wheels, silencer, driver’s handle,
whippers, breaks, mirrors, etc. After this 75% of the process is
completed.
Now checking us made with the help of testing machines. They
check the wheels, gears, breaker of the vehicles and sought out
the problem if any.
The back part of the vehicle is to be painted in the paint stock.
The surface is painted using painting guns or spray in the paint –
booth. Then it is passed on to the dry – off over for the purpose of
drying at a temp. of 120ºC to 150ºC.
The painted components are moved to the assembling area in
special trolleys. The assembly station is equipped with suitable
fixtures storage arrangement for holding components and suitable
pneumatic assembly tools. Now the entire vehicle is completed.
The assembled vehicles under go a through test of quality control
to maintain the level of quality in the market and the satisfaction
of the consumer.
Plant LocationThe chief object of an industrial concern is to maximize profit
through the minimization of cost of production. This is possible when
the firm is of the right size and is located at the right place. It must be
clearly understood that an optimum location is very much helpful for the
functioning of the industry.
The factors which usually determine the location of industries
may be described as under:
Availability of raw material.
Markets.
Fuel and Power.
Transport Facilities.
Labor.
The ATUL AUTO LTD., is located at Survey No. 86, on
National Highway 8-B at Shapar – Veraval. The firm selected this
location because it is on industrial area and all the facilities like
transportation, labor, raw materials, etc. are easily available.
The plant location of ATUL AUTO LTD is given as follows:
Plant LayoutPlant layout refers to the arrangement of the physical facilities
including production centers for the manufacturing of a product. In
thinking of work improvement techniques, the relationship among
work–centers is one the most important item.
The plant layout of ATUL AUTO LTD. is as follows:
Inventory ControlAll the goods between the receipt of raw materials and the
dispatch of final products to customers are termed as inventory.
Inventory includes raw materials, component parts, semi – finished and
finished products.
Inventory control means control over materials lying in store.
Inventory control keeps continuous track of inventories. Inventory
control aims at the following objectives:
(1) Never run out of anything (Out of Stock).
(2) Never build up a very large inventory.
(3) Never send out too many small costly orders for more.
AUTL AUTO LTD., being an automobile industry, has different
stores department in which there is a systematic storage of inventories
i.e. raw material, semi – finished and finished goods.
These are five different types of stores department in ATUL
ATUO LTD:
(1) General Store.
(2) Tool Store.
(3) Raw Material Store.
(4) Fabrication Store.
(5) Finished Goods Store.
Pollution ControlPollution means to make the environment dirty & impure with
harmful and poisonous substance. The pollution may be air pollution
water pollution, noise pollution, and pollution. Government has now
made compulsory for all the industries to lake measures regarding
pollution control.
In ATUL AUTO LTD., the problem of pollution is nearly nil.
This is because no smoke as produced during the production process.
Also no water or land pollution being caused by the industry. So the
company has received a NO OBJECTION CERTIFICATE from the
government.
Quality ControlQuality Control is the control of quality during the manufacturing
process. Modern economy under competitive market conditions insist of
quality and also cost reduction. A customer in the industrial market
considers quality in relation to price and purpose.
Quality control detects the causes of variations in the
characteristics of products, and indicates the necessary adjustments by
which these variations can be controlled. Thus, “Quality Control is the
systematic control of those variables which affect the excellence
(prescribed norms) of the final product”.
The quality control department of ATUL ATUO LTD., checks
the quality of the goods with the help of equipments like crack –
detector, harness tester, etc. This department checks the quality of raw –
materials and finished products. Not only this it also checks the quality
of at every stage of the production process. The responsibility of
controlling the quality is held by the supervisors of production
department in ATUL AUTO LTD.
Scrap & Waste ManagementThe unnecessary accumulation of absolute, surplus and scrap
items is said to be waste and enough capital is blocked in it. The
increase in all such items will increase the product cost which in turn
will reduce the profits. Therefore efforts should be made manage such
scrap and waste materials.
The firm, ATUL AUTO LTD., has a special scrap yard in which
the scrape from machine shop and fabrication is assembled. This scrap is
weekly collected and sold to a person named Abdulbhai. This is a way
of income for the company.
Stores ManagementStores management is that aspect of material control concerned
directly with the physical storage of goods. The principle function of
stores management is to act as a clearing house for goods i.e. receipt
goods bought and issue of needed materials in the plant against
authorized orders.
ATUL AUTO LTD., maintains a computer online system of their
own for the purpose of stores management. They make entries for each
& every purchase, sale, transfer, goods or materials. This records of
every material starting from purchase to final production and finally to
sale is maintained in this system. The head of stores management is
“Mr. J. Mehta”.
Material HandlingMaterial Handling involves the movement of materials from one
place to another for the purpose of processing. They are moved either
manually or technically with the help of different types of material
handling equipments.
In ATUL AUTO LTD., material handling equipment used is
hydraulic trolley and simple trolley. Simple trolley are more frequently
used while hydraulic trolleys are used to carry very heavy materials.
These trolleys are used to carry materials from one place to another.
CONTENTS
Sr. No. Particulars Page No.
1 Introduction
2 Organization Structure
3 No. of Employees and Shifts
4 Working hours
5 Recruitment & Selection
6 Training & Development
7 Wages & Salary Administration
8 Promotion & Transfer
9 Performance Appraisal
10 Records of Employees
11 Industrial Relations
12 Grievance Handling System
Introduction“The personnel function is concerned with the procurement,
development, integration and maintenance of the personnel of an
organization for the purpose of contribution towards the
accomplishment of the unit’s major goals and objectives.
Personnel management is very important in the smooth
functioning of any kind of organization. Whether it is a manufacturing
firm, a government organization or a non – profit making trust or club.
Man is an active factor of production which controls and co-ordinates all
other factors.
ATUL AUTO LTD., has a separate personnel department of its
own. It considers it as the most important department of the industry.
The personnel manager of ATUL AUTO LTD., is “Mr. M. H. Desai”.
Organization StructureAn organization structure indicates relationship between the
employees of an industrial undertaking. It indicates a clear relationship
between authority and responsibility for the employers.
In order to solve the problems of the personnel department
efficiently and in a responsible manner it has become necessary to
establish a separate. Personnel Department in the organization. It shall
be responsible for performing all the personnel functions efficiently
establishing sound and effective personnel policies practices and
programs and taking unbiased decisions in the interest of the labourers.
ATUL AUTO LTD., has a separate personnel department as
follows:
Chart of Personnel
Department
M.D.
J.M.D.
Manager (P&A)
Asst. Manager (P&A)
Sr. Assistant Jr. Assistant
Bus/Car Driver Time Keeper Reception Sec. Guard
Peon
No. of Employees and ShiftsThe number of employees indicates the total employees working
in the firm for all the shifts. There are in all 360 employees in the
company.
Generally, there is one shift for the employees. But if there is
overload of work then there is an extra – shift (which is in a very rare –
case).
Morning Shift: - 9:00 a.m. to 1:00 p.m.
Afternoon Shift: - 1:30 p.m. to 5:30 p.m.
Extra Shift: - 6:00 p.m. to 9:00 p.m.
Working HoursThe company has a standard time keeping system for working
hours. The employee works for 8 hours regularly from 9:00 am to 5:30
p.m. It required they work for extra 3 hours from 6:00 p.m. to 9:00 p.m.
The workers or employees generally do not require working overtime.
The time discipline is well maintained in the company. Time –
punching machines are placed. Which, are attached with the computer.
Each employee is given a card. Which is to be punched in the punching
machine as and when he enters & leaves the factory or working place.
This all the records of every employees are received through computers.
Recruitment & Selection“Recruitment is the process of development and maintenance of
adequate manpower resources. It is the positive process of
employment”.
The success of any organization depends upon the skill of its
employees. Os the process of recruitment plays an important part in the
success of the unit.
In ATUL AUTO LTD., the recruitment of general managers &
above staff is made through newspaper advertising or through
NAUKARI.COM site. While the recruitment of functional staff,
supervisory staff, computer operators etc. becomes very easily because
the company receives daily application for these posts. They, have their
data book for all the applications.
Selection“Selection is the process in which candidates for employment are
divided into two classes, those who are to be altered employment and
those who are not”.
ATUL AUTO LTD. carries out the selection process to appoint
only these persons who are suitable for the job and have better abilities
for selection various instruments such as the aptitude test, interviews are
used.
Selection Procedure(1) One-day trial.
(2) Personnel Discussions (interviews)
(3) Final Selection.
(1) One – day Trail: -
In this stage the person applying for the job is asked for
operating the grinding machine or any other machine to see his
skill.
(2) Personnel Discussions (interview): -
In this, the person is asked technical questions by
personnel department head, which he has to answer based on his
knowledge and experience.
(3) Final Selection: -
The final selection is made by personnel manager and
concerned department head. They select employee on the basis of
their qualification, experience & skills.
Training & Development“Training is the act of increasing the knowledge and skills of an
employee for doing a particular job”.
It is a systematic program of the organization which aims at
increasing the aptitude skills, and ability of the workers to perform their
specific jobs. By training, the employee will acquire the new skills,
technical knowledge, problem solving ability etc.
At ATUL AUTO LTD. the workers are trained under the
guidance of the senior worker of the concerned department or by the
training engineer. A training of 1 week is given to the worker and then
he is taken as a permanent employee of the company.
For the development of the present employees also trainers are
called from Ahmedabad. The company’s training officers also play a
major role for the development of the employees in the way of progress.
Wages & Salary
Administration“The compensation rendered to the employees of an organization
in return for the kind of job done or service rendered is known as wage
or salary”.
At ATUL AUTO LTD. the salaries that are above 4000 Rupees
are paid through cheques of HDFC, SBI & ICICI.
While salary below Rs.4000 are paid in cash between the dates of
1 to 7 of the month.
The workers get 20% bonus every year from the company. They
also get on increment in their salaries every year from 1st April. Thus the
wages & salaries administration of the company is well maintained.
Promotion & Transfer
Promotion“The term promotion refers to the upward shifting of a personnel
where his salary status responsibilities and authorities will be higher
than before”.
In ATUL AUTO LTD. there is 0 policy to give promotion to 1 or
2 employee from each department every year. Promotion is given on the
basis of departmental head’s recommendation. They recommend to the
directors and the directors take the final decision for promotion. The
important factors which are considered for promotion of an employee
are his experience, performance and skills.
Transfer“Transfer refers to the horizontal shifting of an employee without
any change in the salary, status, responsibilities and authorities of the
employee”.
In case of transfer policy, ATUL AUTO LTD. does not feel the
need to have one. An employee is not transferred under general
circumstances but in some cases like if a skilled worker is needed at one
sales branch at a place, then the worker is provided from other place to
satisfy the branch’s need.
E.g.: -
If there is shortage of a service engineer in Andhra Pradesh. Then
a person is transferred from Maharashtra to Andhra Pradesh for
this reason.
Performance Appraisal“The performance appraisal system is the process of evaluation of
an employees performance on the job in terms of its requirements”.
At ATUL AUTO LTD. the performance of an employee is
measured from time to time taking into accounts his work during the
year, his period of service, his behavior with other employees and heads,
his time discipline etc.
The process of performance appraisal is beneficial both from the
point of view of the company to maintain discipline among the worker
and from the point of view of workers for their self – development.
Records of EmployeesThe personnel department of the unit is assigned the task to
maintain up-to-date records of the employees of the organization.
At ATUL AUTO LTD. a records of all the employees are
maintained including their past experience, certificate of age, group, last
qualification, additional trainings (if any), etc. The record is maintained
till 5 years after the employee leaves the job.
These records are kept by head of the personnel department.
Grievance Handling SystemGrievance, as defined by the international labor organization is
“A complaint of one or more workers in respect of wages, allowances,
conditions of work and interpretation of service stipulations, covering
such areas as overtime, leave, transfer, promotion seniority, job
assignment and termination of service”.
The administrators of an organization put in their best efforts in
the formulation and implementation of the policies, programmes and
procedures which would best enable them to handle employees
grievances. These policies, programmes and procedures are generally
known as grievance handling procedure or system.
In ATUL AUTO LTD. the procedure for grievance handling is
fixed i.e. whenever a grievance arises among workers, firstly it is
handled by the departmental head. If he fails to solve it the problem goes
to the personnel head and if he too fails in the settlement of that
grievance the board of directors have to handle the case.
It for instance, a worker’s behavior is undesirable, he is first
given an oral notice regarding it. If he doesn’t improve, he is given
written notice and even if he fails in improving himself, he is given
transfer or demotion and finally he is terminated if he remains the same.
This is now Grievance Handling System in ATUL AUTO LTD. works.
Industrial RelationsThe term “Industrial Relations” is used to refer to the relations
between the parties concerned with industry. The two parties which
come into direct contract with each other are the workers and the
management representing the employee. Both the parties have a
common interest in industry and yet there are various occasions when
there is difference of opinions among them.
In ATUL AUTO LTD., there is an environment of peace and
harmony among the workers and employees. So these is an absence of
any trade unions in the company as it is not required.
CONTENTSSr. No. Particulars Page No.
1 Introduction
2 Organization Structure
3 Market Segmentation
4 Market Research
5 Products & Product Related Strategies
6 Pricing Policies
7 Promotion Mix Advertising
8 Channels of Distribution
9 Exports
10 Competitors
IntroductionMarketing occupies an important position in the organization of a
business unit. As traditionally defined “Marketing consists of these
efforts which effect transfers in ownership of goods and care for their
physical distribution”.
F.E. Clark
The above definition of marketing is a description of the physical
activities involved in the process of distribution of goods. However
marketing is more than a mere physical process or a set of activities.
The purpose of a business is to create a customers. “Marketing is
the function of business concerned with the creation of a customer”.
Peter Drockes.
Thus the modern concept of marketing focuses on the
“Consumer” and the satisfaction of his needs.
Organization Structure
Chart of Marketing Department
M.D.
J.M.D.
G.M.
Zonal Manager (NW)
Zonal Manager (CZ)
Zonal Manager (WZ)
Zonal Manager (SZ)
Zonal Manager (EZ)
Area Manager Area Manager
Sales Officer
Service Engr.
Sales Officer
Service Engr.
Area Manager Area Manager
Sales Officer
Service Engr.
Sales Officer
Service Engr.
R.O. E+E Sr. Asst. Sr. Mgr. (S&S)
Ast. Sales Comp. Optr. Sr. Engr.
Dirver Jr. Engr.
Peon Supsr. Sr. Asst.
Mech. Jr. Asst.
Helper Helper
Market Segmentation“Market Segmentation is the process of taking the total
homogeneous market for a product and dividing it into several but
markets and segments”.
The process of market segmentation can be carried out on the
basis of geographical area age, sex and personal preference of the
customer etc.
Market segmentation in ATUL AUTO LTD. is not done. The
company is having only one segment. Hence segment wise bifurcation is
not required to be given.
Market Research “Marketing Research is the systematic recording and analyzing
the data relating to the marketing of goods and services”.
Marketing research is the branch of marketing information
system. The term market refers to the actual & potential consumers.
ATUL AUTO LTD. has a special R & D department (Research &
Development) which carries out market research for the following
purposes:
It provides them with the information about the needs wants and
performances of the consumers.
It provides them the information regarding the current demand
analysis in the market. So as to predict their sales fore cast.
It helps them in the fixation of the prices of their products.
It helps them to modify their products according to the current
trends and preferences of the customers.
Products & Product Related
Strategies“A product is anything that can be offered to a market for
acquisition, use or consumption that might satisfy a want or need”.
In marketing management, product planning is the first and most
important step in the process. It occupies an important place as it is fully
under the control of the organization. A good product can set the game
of market capturing in favor of the company.
The products of ATUL AUTO LTD. may be divided under two
categories passenger and loading. They are available in RTO’s fix
colors i.e. Grey & Yellow.
(1) Passenger: -
6 Passengers + 1 Driver.
3 Passengers + 1 Driver.
4 Passengers + 1 Driver.
(2) Loading: -
Delivery Van.
Pick up Van Highdeck.
Pick up Van Standard.
Tipper.
Chicken Carrier.
Water Tanker.
Soft Drinks Carrier.
Mobile Shop.
These vehicles are available in various colors viz, Yellow, Red,
Blue, etc.
In today’s highly competitive world. ATUL AUTO LTD. has set
up product planning on the basis of market demand. Competitors and
other factors.
Pricing PoliciesAn important function closely allied to selling is that of
determining the price policy to be followed by a concern.
At ATUL AUTO LTD. the pricing decisions are taken by the top
level management. The company does not adopt any specific pricing
policy but it keeps the following factors in mind while pricing its
products:
Cost of production.
Prices of its competitors.
Normal profit.
Cost of advertisement.
Cost of transfer & distribution.
Taxation.
Dealer’s Margin.
For pricing their products in international markets the company
takes into account the following additional factors into consideration.
Export packing costs.
Market condition of that country.
Export duties.
Cost of preparation of export documents.
Promotion Mix Advertising“Promotion consists of a diverse collection of effective tools,
mostly short term, designed to stimulate quicker and / or greater
purchase of a particular product”.
During festivals like Diwali, Janmashtami, etc. ATUL AUTO
LTD. offers free mobiles, T.V’s, DVD’s etc. for the purpose of their
products promotion.
AdvertisingAdvertising is a non-personal communication advertising may be
made throw newspapers, pamphlets, TV, Radios, etc.
Advertising is one channel of information for consumers. They
get to know about new products, product improvements, price changes,
packaging innovations, special credit term’s and so on from advertising.
ATUL ATUO LTD. have chosen newspaper and their primary
mode for advertising. The company selected this mode because
newspapers are affordable also to the lower & medium class people who
are their main customer. Also they advertise their product in the regional
language for the convenience of their customers.
Besides they also use holdings and pamphlets for the purpose of
advertising.
Channels of DistributionThe term “Channels of Distribution” is used to refer to the
various alternative link roads which connects the producer with the
consumer. The possible paths by which products may be channelised to
the consumer are varied in number and character.
The company ATUL AUTO LTD. follows a simple channel of
distribution:
Manufactures
Main Dealers
Sub – Dealers
Customers
Thus, the products manufactured by then are sent to the main
dealers at various states. Then the sub – dealers and finally to the
customers.
ExportsThe products of a company when sold in the markets or foreign
countries are known as exports. It helps in increasing the foreign
exchange of a country. Thus, the export activities plays a significant role
in the economic upliftment of a nation.
The company ATUL ATUO LTD. supplies its vehicles with
brand name “ATUL SHAKTI” in an African Country Nigeria. It
supplies 50 vehicles to a transport agency in Nigeria. This agency uses
this vehicles mainly for transportation or as load carrier.
The company with its brand name “KHUSHBU” has exported in
Asian and African Countries.
CompetitorsThe competitors play an important role of the functioning of the
unit and prices of the products. The competitors of ATUL AUTO LTD.
are:
Bajaj
Piojjio
Scoter India Ltd.
Local Manufacturers like Pals, etc.
CONTENTSSr. No. Particulars Page No.
1 Introduction
2 Organization Structure
3 Financial Planning
4 Capitalization
5 Capital Structure
6 Fixed Capital Management
7 Working Capital Management
8 Receivables Management
9 Cash Management
10 Profit & Profitability
Introduction“Financial Management is concerned mainly with such matters as
how a business unit raises its finance and how it makes use of it
efficiency”.
- Hogland.
In simple words, it means raising of adequate funds to the
minimum cost and using them effectively in business. It is mainly
concerned with the financial problems of the business.
The finance department has to cover a long range of functions
such as maintaining adequate funds on hand to meet expenses of both
revenue and capital nature. Smooth availability of finance for running
the enterprise and easy availability of finance for the expansion of the
business as and when needed, determine the success of the financial
management.
A’s of Financial Management
Anticipating Financial Needs.
Acquiring Financial Resources.
Allocating Funds in Business.
Administrating the Allocation of Funds.
Analyzing the Performance of Funds.
Accounting and Reporting to Management.
Financial Management
Organization Structure
Chart of Finance Department
M.D.
J.M.D.
G.M. (Finance)
Sr. Manager (Accounts)
Asst. Manager (Acct.) Asst. Manager (Excise)
Sr. Asst. (Excise)
Jr. Asst. (Excise)
Sr. Asst. (Acct.) E.D.P. Officer
Jr. Asst. (Acct.) Comp. Optr.
Comp. Optr.
Peon
Financial PlanningFinance is undoubtedly the life – blood of the business. The
ambitious plans of a businessman would remain mere dreams unless
adequate money is available to convert them into reality.
One of the most important function of the financial manager is
that of planning.
“Financial Planning is mainly concerned with the economical
procurement and profitable use of funds which is characterized by
realistic investment decisions”.
The company ATUL AUTO LTD. gives good weitage to
financial planning to facilitate the availability of funds at the right time
to meet their demand for capital both fixed as well as working.
The company, ATUL ATUO LTD. prepares a financial plan
keeping in view the following points:
Amount needed for working capital.
Cost of fixed assets and their maintenance.
Amount to be kept aside for salaries and wages.
Amount to be paid as bonus.
Other office expenses.
Cost of maintenance of vehicles.
Amount to be kept aside for contingencies.
Capitalization“Capitalization comprises of a company’s ownership capital
which includes capital stock and surplus in whatever form it may appear
and borrowed capital which consists of bonds or similar evidences of
long term debts”.
- Gerstenbug.
If capitalization of a company is just equal to its requirements it
is considered to be properly capitalized. If it is more than required, it is
considered to be over-capitalized. Similarly if the capital is less than the
required amount, it is said to be under capitalization.
The capitalization of ATUL AUTO LTD. is as follows:
Authorized Capital: -
80,000,000
Paid up Capital: -
53,515,200
Capital Structure“Capital Structure of a Company refers to the make-up of its
capitalization”.
- Gerstenberg.
However, in a broader sense, capital structure includes all the
long-term capital including loans, debentures, bonds, share issues,
reserves, etc. and the components of the total capital.
In simple words, capital structure refers to the composition of
capital in on organization. ATUL AUTO LTD., has acquired their
capital by issue of share capital but it has not issued any preference
shores or debentures.
The capital structure of ATUL AUTO LTD. is as follows:
Share Capital 55,844,050
Reserves & Surplus 144,149,373
Secured Loans 112,784,313
Unsecured Loans 57,813
Fixed Capital ManagementCharles Prather says that “Fixed Assets are those which of a some
what fixed or permanent in nature and are used by the business in its
normal operations, they do not include items offered for sale”.
Fixed Assets (capital) management is the most important task
which a management has to face in its day-to-day situations fixed assets
includes land, machineries, office building, vehicles, and other
equipments used by the enterprise.
The details of the fixed assets owned by ATUL AUTO LTD. are as
follows:
Particulars Net Block
Land 4,659,821
Factory Building 26,817,994
Building 13,801,111
Plant & Machinery 48,316,152
Furniture 4,070,856
Vehicles 2,826,357
Other Assets 435,204
Windmill 53,575,833
Lease land (for windmill) 1,00,000
Grand Total 154,603,328
Working Capital
ManagementIn accounting, “Working Capital is the difference between the in
low and out low of funds. It is defined as the excess of current assets
over current liabilities and provisions”.
Thus it can be said that:
Net = Current – Current Working Assets Liabilities Capital
At ATUL AUTO LTD. the following currents form its working
capital:
Particulars Amount
Current Assets
Inventories
Sundry Debtors
Cash & Bank Balances
Loans & Advances
72,306,020
62,934,110
11,441,798
56,145,885
- Less Liabilities & Provisions 55,061,055
= Net Working Capital 147,766,758
Receivables ManagementReceivables are the assets which are created as a result of the sale
of goods or services in the ordinary course of business. These are known
as “accounts receivables trade receivables or customer receivables”.
The following is the amount of receivable i.e. debtors in ATUL
AUTO LTD.
Sundry Debtors = 62,934,110
Cash ManagementCash Management is one of the key areas of working capital
management. Apart from the fact that it is the most liquid current asset,
cash is the common denominator to which all current assets can be
reduced because the other major liquid assets i.e. receivables and
inventory get eventually converted into cash. This underlines the
significance of cash management.
The term cash with reference to cash management is used in 2
senses. In a narrow sense it is used to cover currency & generally
accepted equivalents of cash such as cheques, drafts, demand deposits in
banks, etc. The broader view of cash also includes near cash assets such
as marketable securities and time deposits in banks.
Cash on hand and balance in bank is one of the most important
elements in day to day business life. So different balance of cash is
important to maintain on hand.
ATUL AUTO LTD. has following cash and bank balance as on
31st March 2005.
Cash on hand: - 317,031
Bank Balance: -
With scheduled bank in Current A/c. 10,004,477
With scheduled bank in deposit A/c. 1,052,877
With other banks in current A/c. [Citizen
cooperative bank Ltd.]
1,973
With other banks in deposit A/c. [Citizen
cooperative bank Ltd.]
65,438
11,441,797
ATUL AUTO LIMITED
BALANCE SHEET AS AT 31st MARCH 2005
Particulars Sch
.
No.
As at 31st
March 2005
(Amount in Rs.) As
at 31st March 2004
A. SOURCES OF FUNDS
(a) Share Holder’s funds
Share Capital
Reserves & Surpluses
Sub Total
(b) Loan Funds
Secured Loans
Unsecured Loans
Sub Total
Deferred Tax Liabilities Net
Total
1
2
3
4
5
55,844,050
144,149,373
199,993,423
112,784,313
57,813
112,842,125
22,200,537
335,036,085
55,844,050
114,024,310
169,868,360
54,158,315
2,089,702
56,248,017
15,526,805
241,643,182
B. APPLICATION OF
FUNDS
Fixed Assets
Gross Block
Less: depreciation
Net Block
Working in progress6
203,357,908
48,754,580
154,603,328
9,706,000
164,309,328
125,716,115
40,935,687
84,780,428
1,827,262
86,607,262
Investments
Current Assets loans and
Advances
Inventories
Sundry debtors
Cash and bank balances
Loans and advances
Sub Total
Less: Current liabilities &
provisions
Net Current Assets
Total
Notes on A/c. & Significant
accounting policies
7
8
9
10
11
12
13
22,960,000
72,306,020
62,934,110
11,441,798
56,145,885
202,827,813
55,064,055
147,766,757
335,036,085
22,960,000
44,415,465
50,967,303
23,814,848
49,948,717
169,146,333
37,075,840
132,075,493
241,643,182
Profits & Profitability’sThe main purpose of any business unit is to earn profit. Profit is
the motivating force for business. It is a yard stick of efficiency in
business.
Profit is earned by selling a product at a higher price than its
purchase price. In the absence of profit the closure of business is
imminent.
In ATUL AUTO LTD. besides other motives such as fulfilling
social responsibilities, providing employment, maintaining prestige etc.
profit is kept as the main & primary motive.
The profits of ATUL AUTO LTD. has been increasing reasonally
beginning.
Following is the chart showing profit after taxes & turnover of
ATUL AUTO LTD. for the last 5 years:
PAT – Profit After Taxation.
SWOT AnalysisSWOT analysis means the Strength, Weakness, Opportunities and
threats of the company. The same for ATUL AUTO LTD. is given as follows:
1 S (Strength) The strength of ATUL AUTO LTD. is that
the prices of the products of this company
are comparatively less than its competitors.
So they are able to sale on a large number.
2 W (Weakness) Weaker quality material used in their
products is the major weakness of the
company, which they are trying to
improve.
3 O (Opportunities) They have started dealing in 4-wheelers
and also planning to introduce LPG and
CNG based vehicle which has a bright
future.
4 T (Threats) The threat for the company is that as there
is an open market in India today, the entry
of any ‘American or other country’s
company may prove harmful for the
company.
Future PlansThe future plans of ATUL AUTO LTD. is as follows:
Expanding their markets in four wheeler goods carriers.
They are signing a contract with a Chinese company for the
supply four wheeler goods carrier.
They have a target to produce 5000 units per month before 2010.
SUGGESTIONSThe company has an excellent administration set up and do not
feel necessary to suggestions.
However, here are few suggestions to the company:
The company should advertise its products broadly to increase
sales.
The company should bring the latest technological up-gradation
in its vehicles.
The company should try and provide fuel – efficient vehicles at
affordable prices.
The company should try to reduce the noise and air pollution
caused by its product “KHUSHBU ROAD MASTER”.
CONCLUSIONATUL AUTO LTD. has an all together different outlook in
competitors.
After the completion of my industrial visit at ATUL AUTO LTD.
I would like to conclude that the working of the company is must helped
by excellent panel of administrators.
The level of efficient administration and maintenance sets a
goods example for other in the automobile industry and the company
promises itself a bright future by hard work & communicate. The
company thus plays a significant role in the economic development of
India.
BIBLIOGRAPHY
Organization and Management
- Dr. C. B. Cropta
Modern Business Organization and Management
- S. A. Sherlekar.
- V. A. Sherlekar.
Fundamentals of Business Organization and
Management
- Y. K. Bhushan.
Financial Management
- P. V. Kulkarni.
- B. G. Satyaprasad.