SHREEJI ASIA

1.1 INDUSTRY PROFILE

The most emotional purchases anyone can make. When real estate
professionals work with top interior designers to create imaginative
living environments, consumers will be able to picture themselves at
home they wont have to re-imagine an empty space. Our hope is
that this event will create lasting partnerships between both
industries.
Shreeji Asia is one of the most diversified construction groupReal
estate is not just about selling a space; it's about selling a lifestyle,
buying a home is one of s with activities across India, covering
development of commercial buildings, residential land and designing
false ceilings, and most other works related to the development of
classy global interiors.
Shreeji Asia Pvt. Ltd. is the parent company having two verticals
under it, that is, Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd. and
Shreeji Interiors.

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Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd. is involved in

development of Infrastructure Projects with safety, reliability and
quality as their key principles.
Shreeji Interiors is involved in executing designs in terms of
Furnishing, Civil, False Ceilings, Flooring, Carpentry, Electrical and
other

works

related

to

the

development

of

Interiors.

The company also has Malur Facility which is used to develop

designs in large area, in minimum time frame and with precision.
1.2. A. INDIAN REAL ESTATE SECTOR - AN OVERVIEW
The real estate boom in India was inextricably linked to the countrys
economic stability, which had made India a preferred investment
destination.
India is on the verge of becoming one of the fast growing economies,
driven by many factors including multinational entrepreneurialism,
buoyant local stock markets, robust economy-changing demographics
and the overall emergence of India on the global stage. With great
demand for housing for Indias huge population and for commercial
and industrial premises for its booming economy, large-scale real

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estate projects were launched across the whole country. This

transformed the real estate business into one of the most lucrative
sectors in the country. A sector which attracted venture capital and
diversified sources of funding including overseas and private domestic
funds and private equity funds. To create an environment friendly to
foreign investors, foreign district investment up to 100 percent was
allowed in 2005 in townships, built-up housing and construction
development projects with the liberalization of FDI regulations. The
inflow of funding catalyzed the organized development. However, in
2008, the global meltdown in real estate produced a corresponding
downturn in the India real estate sector.
Needless to say, the real estate sector plays a significant role in the
Indian economy; it is second only to agriculture in terms of
employment generation and substantially contributes to the gross
domestic product of the country. The contribution of the real estate
sector to Indias gross domestic product (GDP) has been estimated at
6.3 per cent in 2013, and the segment is expected to generate 7.6
million jobs during the same period. It is also expected to generate
over 17 million employment opportunities across the country by 2025.

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Moreover, the construction sector has also been responsible for the
development of over 250 ancillary industries such as cement, steel,
paints, brick, timber, building materials etc. A study by a credit rating
agency ICRA shows that the construction industry ranks third among
the 14 major sectors in terms of direct, indirect and induced effects in
all sectors of Indian economy. A unit increase in expenditure in the
real estate sector can generate a fivefold increase in income. With the
downturn in the economy, and being a capital-intensive industry, the
real estate sector started to face a liquidity crunch emanating largely
from banks cautious approach to financing real estate companies. This
approach was reflected in lower loan-to-loan property value,
construction-linked payment ad financing only for projects nearing
completion. Further, real estate developers also had to cope with other
sources of funding, such as private equity and stock markets, drying
up considerably; receivables from residential projects under
construction getting blocked; falling demand and buyers deferring
payments until they took possession of properties. The resultant fall in
valuation I the past few months coupled with high interest rates and

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low availability of money had put real estate developers on the

defensive and kept homebuyers away.
Riding high on the back of rapid urbanization, positive demographics
and rising income levels, the Indian real estate sector has attracted
significant investment over the past few years. The growing stability
of the market is reflected by the
Continuous growth of the core investors, with over Rs 7,705 crore
invested in ready office space during the last three years.
1.2. B. Segments in the Indian Real Estate Sector
Fig 1.1 Indian Real Estate Sector Segments

1.2. C. Real Estate Market

The real estate sector in India is being recognized as an infrastructure
service that is driving the economic growth engine of the country. The

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Indian real estate market size is expected to touch US$ 180 billion by
2020. Foreign Direct Investment (FDI) in the sector is expected to
increase to US$ 25 billion in next 10 years, from present US$ 4
billion.
Demand is expected to grow at a compound annual growth rate
(CAGR) of 19 per cent between 2010 and 2014, with tier I
metropolitan cities projected to account for about 40 per cent of this.
Growing infrastructure requirements from sectors such as education
health care and tourism are also providing opportunities in the real
estate sector.
The construction industry ranks third among the 14 major sectors in
terms of direct, indirect and induced effects in all sectors of the
economy. The industry's growth is linked to developments in the
retail, hospitality and entertainment (hotels, resorts, cinema theatres)
sectors, economic services (hospitals, schools) and information
technology (IT)-enabled services (like call centers) etc. and vice
Versa.
The sector is divided into 4 subsectors

Housing;
Retail;
Hospitality;
Commercial;

The housing sub-sector contributes five-six per cent to the country's

gross domestic product (GDP). Meanwhile, retail, hospitality and
commercial real estate are also growing significantly, catering to
India's growing needs of infrastructure. The Indian real estate market

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size is expected to touch US$ 180 billion by 2020.

India is going to produce an estimated 2 million new graduates from
various Indian universities during this year, creating demand for 100
million square feet of office and industrial space.

Fig 1.2 Growth Drivers of Real Estate Market

1.2. D. Market Players
The Indian real estate sector has traditionally been an unorganized
sector but it is slowly evolving into a more organized one. The sector
is embracing professional standards and transparency with open arms.
The major established domestic players in the sector are DLF,
Unitech, Hiranandani Constructions, Tata Housing, Godrej Properties,
Omaxe, Parsvanath, Raheja Developers, Ansal Properties and
Infrastructure and Mahindra Lifespace Developers Ltd to name a few.
International players who have made a name for themselves in India

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include Hines, Tishman Speyer, Emaar Properties, Ascendas,

Capitaland, Portman Holdings and Homex.
i)

DLF Ltd

DLF group is a leading real estate developer in India since 1946. DLF
has been instrumental in putting Gurgaon on the urban landscape of
India. DLF has over 220 million sq. ft. of existing development
projects and 574 million sq. ft. of planned projects. DLF has so far
developed 22 urban colonies, and an entire integrated 3,000-acre
township - DLF City. DLF's development projects across India span
over 30 cities: Gurgaon, Ambala, Shimla, Amritsar, Jalandhar,
Ludhiana, Sonepat, Panipat, Chandigarh, Panchkula, Noida, New
Delhi, Jaipur, Indore, Ahemdabad, Baroda, Lucknow, Faridabad,
Mumbai, Pune, Nagpur, Goa, Kochi, Kokkanad, Chennai, Bangalore,
Vytilla, Coimbatore, Hyderabad, Bhubaneswar and Kolkata.
ii)

Unitech

Established in 1972, Unitech is Indias leading real estate developer in

India. It is the first developer to have been certified ISO 9001:2000 in
North India.
Project Spectrum: Unitech offers diversified projects across
residential, commercial/IT parks, retail, hotels, amusement parks and
SEZs segments. Unitech was the first real estate company to be part of
the National Stock Exchanges NIFTY 50 Index. The company has
over 600,000 shareholders. Unitech and Norway based Telenor Group

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came together to build Uninor a telecommunication services

company providing GSM services across India.
iii)

Ansal API

Established in 1967 as a family business, Ansal API today is clearly

amongst the real estate leaders of India. Having established itself very
strongly in the NCR region, Ansal API is now focusing on ventures in
cities like Bhatinda, Mohali, Amritsar, Ludhiana, Jalandhar, Jaipur,
Jodhpur, Ajmer, Sonepat, Panipat, Karnal, Kurukshetra, Faridabad,
Gurgaon, Greater Noida, and Ghaziabad, Meerut, Agra, Lucknow, to
name a few. Ansal API has till date, developed and delivered more
than 190 million sq ft. The company currently has a land reserve of
about 9,335 acres.
Project Spectrum: Integrated Townships, Condominiums, Group
Housing, Malls, Shopping Complex, Hotels, SEZs, IT Parks and
Infrastructure and Utility Services

iv)

Sobha Developers Ltd.

The Company was founded in 1995 by PNC Menon after he returned

home from the Middle East where he was acclaimed for quality
interiors and construction since 1977. Today, this Rs10 billion plus
company is one of the largest and only backward integrated company
in the construction arena. Its IPO in 2006 was oversubscribed by 126
times that created history, being the first event of its kind in Indian

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capital markets.
Till date, Sobha has completed 47 residential projects, 13 commercial
projects and 166 contractual projects covering about 36 million sqft
area in 18 cities across India (as of 31 March 2010). The company
currently has 21 ongoing residential projects aggregating to 8.5
million sqft, while 4.24 million sqft of contractual projects are under
various stages of construction.

v)

Parsvanth Developers Ltd.

Incorporated in July 1990 by Mr. Jain in New Delhi, Parsvnath today

has a substantial pan India presence in over 45 cities across 16 states.
The company has emerged as one of the most progressive and multifaceted real estate and construction entities in India.
Project spectrum: Housing (premium, mid-market as well as
affordable), office complexes, shopping malls & hypermarkets, hotels,
multiplexes, IT Parks and SEZs.

1.2. E. FINANCIAL SUPPORT TO THE SECTOR

In the Financial Years 2007-08, 2008-09 and 2009-10, the housing and
real estate sector attracted FDIs of 8.9%, 10.3% and 11% respectively,
of the total FDI in India. However, the financial year 2010-11 saw a
mere 6% FDI in this sector. The year 2010 saw the Indian real estate
sector spring back into action after the gloom and recessionary

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pressures experienced in the aftermath of the global downturn. The

focus on affordable housing helped the sector tide over the financial
crunch it had witnessed. There is no doubt that the sector holds huge
potential to attract FDI in its various segments. However, progress is
possible only with the joint efforts of both the industry and the
Government. On the one hand, the industry should work towards
increased transparency, clear land titles, improved delivery and project
execution while on the other hand the Government must provide fiscal
incentives to developers to build low cost and affordable housing for
the masses and also review the existing FDI guidelines for investment
and development in Indian real estate in order to increase the flow of
foreign capital into the sector.
1.2. F. BOOSTING R&D IN REAL ESTATE
The Government must provide incentives to the public and private
sectors to take up R&D activities for new building materials and
technologies so that the industry can deliver low cost, affordable, and
sustainable and environment friendly housing and building structures.
1.2. G. POLICY INITIATIVES
Government Initiatives
According to the latest reforms, FDI up to 100 per cent is
allowed under the automatic route in townships, housing, builtup infrastructure and construction development projects to
increase investment, generate economic activity, create new

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employment opportunities and add to the available housing

stock and built-up infrastructure.
The Ministry of Housing & Urban Poverty Alleviation has
planned to introduce a single-window system for clearance of
all real estate projects across the country. The system could
bring down the average approval time from the current 196
days to 45-60 days
The Government of India has sanctioned projects worth Rs
41,723 crores (US$ 7.51 billion)for building of 1,569,000
houses/dwelling units for economically weaker/lower income
group sections under the Ministrys flagship Jawaharlal Nehru
National Urban Renewal Mission (JNNURM) programmes.
Housing finances are becoming feasible with the housing loan
limit being raised to US$ 52080 for priority sector lending
Some of the initiatives taken in the union budget 2013-14 include:
For homes and flats with a carpet area of 2,000 square feet or
more or of a value of Rs 1 crore (US$ 180,213) or more, which
are high-end constructions, where the component of services is
greater, rate of abatement reduced from 75 to 70 percent
Rs 6,000 crore (US$ 1.08 billion) were given to Rural Housing
Fund
National Housing Bank plans to set up Urban Housing Fund. Rs
2,000 crore (US$ 360.47 million) will be provided to the fund in
the current financial year
1.2. H. Investments

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Private equity (PE) investments in real estate investment, reveals that

approximately Rs 118.54 billion is available with private equity firms
ready to be deployed in real estate, despite a drop in the PE
investment in the first half of 2013. While PE investments in real
estate was recorded at Rs 16.38 billion in H1 2013, which is 46%
lower when compared to first half of 2012 (Rs 30.50 billion), PE
funds continue to show keen interest in the market with a number of
deals in discussion. This decline in the quantum of private equity real
estate investment (PERE) was essentially due to fewer deals (13 in H1
2013) as the average ticket size of deals remained same.
The total value of investments in the residential segment recorded at
Rs 9.3 billion in H1 2013 witnessed a drop of 48% over last year. The
total value of investments in the office segment was also lower in H1
2013 at Rs 7.0 billion. However, there is a strong growing trend
towards investments in ready office space. The growing stability of
the market is reflected by the continuous growth of the core investors
(number and value) with over Rs 77.05 billion invested in ready office
space during the last three years.
In 2013, the highest value of private equity investments is noted in
Pune at Rs 7.8 billion followed by Mumbai at Rs 4billion, NCR at Rs
2.3 billion, and Bengaluru at Rs 1billion.
Some of the major investments in the Indian real estate sector are:
Ashiana Housing Ltd plans to foray into Gujarat's real estate
with its first project worth Rs 100 crore at Halol.
Mr. Akhilesh Yadav, Chief Minister of Uttar Pradesh (UP) has

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inaugurated and laid the foundation of development projects

worth Rs 3,337 crore pertaining to Noida, Greater Noida and
Yamuna Expressway
Wave Infratech plans to invest Rs 500 crore to set up its first
affordable housing venture in the Delhi national capital region
(NCR) area
Mahindra Life space Developers has bought the stake of
private equity Arch Capital in its joint venture residential
project at Chennai. The buyout of the stake was estimated to be
around Rs 70 crore.
Godrej Properties Ltd (GPL) has signed a development
management agreement with United Oxygen Company Pvt Ltd
to develop residential housing project in Bengaluru. The
project will offer approximately 1,000,000 sq. ft. of saleable
area and will be developed as a residential housing project.
1.2 .I. CHALLENGES AND INVESTMENT OPPORTUNITIES
CHALLENGES
The key challenges that the Indian real estate industry is facing today
are:

lack of clear land titles,

absence of title insurance,
absence of industry status,
lack of adequate sources of finance,
shortage of labour,
rising manpower and material costs,
approvals and procedural difficulties.

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Investment Opportunities
The real estate industry in India is yet in a promising stage. The sector
happens to be the second largest employer after agriculture and is
expected to grow at the rate of 30 per cent over the next decade. A
growing migrant population due to increasing job opportunities,
together with healthy infrastructure development, is underpinning
demand in the regions residential real estate market.
The Kalpataru spokesperson feels that the Finance Ministry's
motivation through softening of interest rates and lending more to the
real estate sector will have a positive impact on both developers and
consumers. The real estate market could start to perform better as the
easing of FDI norms will begin to show results during the second half
of the year. The economy will also recover in 2013 which in turn will
perk up the real estate sector in India. With the government trying to
introduce developer and buyer friendly policies, the outlook for real
estate in 2013 does look promising.
1.2. J. THE ROAD AHEAD
India has huge potential to attract large foreign investments into real
estate. With real estate reaching a point of saturation in developed
countries and the demand and prices falling, global real estate players
are looking at emerging economies such as India for tapping
opportunities in real estate. Indian real estate will stay attractive due to
its strong economic fundamentals and demographic factors. Moreover,

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there is a high level of global uncertainty looming over the developed

and developing nations of the world. While developed economies are
still struggling to regain their growth momentum, developing
countries including India and China are expected to grow at a
reasonably high rate. Investments in Indian real estate will fetch
higher returns for investors as compared to other global markets. In
the coming years, the opportunities in the real estate sector will attract
more global players to India and hence will help the industry to
mature, become more transparent, improve management and adopt
advanced construction techniques.

1.2. K. INTERIOR DESIGN

INTRODUCTION
Interior design is more than just aesthetics. It's about finding creative
design solutions for interior environments while supporting the health,
safety and well being of occupants and enhancing their quality of life.
Following a systematic and coordinated methodology including
research, analysis and integration of knowledge into the creative
process, interior design is a multi-faceted profession whereby the

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needs and resources of the client are satisfied to create an interior

space that fulfils the project goals.
1.2.L. HISTORY AND TRADITION OF INTERIOR DESIGN IN
INDIA
Interior Design is, in essence, a part of a larger discipline that is
Architecture. Both Interior Design and Architecture are the act of
designing within either a building or a space, and have been adopted
to differentiate the unique foci of work of the interior environment.
However, it wasnt until the late 1980s that Interior Design was
recognized as a discipline separate from Architecture in India. The
historical aspect of Interior Design is almost incomplete without a
reference to the grand Architecture that the nation fashioned.
From the times of the Rajahs and till today, Indian arts and crafts have
embellished plush luxurious homes around the world. Traditionally,
the luxury of a designed space was enjoyed only by the affluent in
India since it was only the rich who could afford to use expensive
materials and hire craftsmen. This is established in the many palatial
buildings that India is home to.
On the other hand, the lower income groups worked with what nature
provided and created wonders in the least available. They created
marvelous structures which mark the resourceful and energy efficient
approach of the majority of Indians. Indias rich culture, diversity and
heritage have left us with a wonderful architectural legacy, whether its
mud houses in Rajasthan, sloping roofs in Konkan or the Tanku

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houses with wind catchers in Khambat.

Post Independence, a new India was formed. Poverty stricken, Indias
growth had stagnated at a GDP of 3.5%. India maintained this GDP
for almost the next 40 years, until the economic liberalization in 1991.
The economic reforms brought about, changed the face of India by
exposing it to the open market, giving way to new avenues in the
design elds.
Until then Indians themselves never truly explored the potential of
design in the interior sector. Traditionally, Indian interiors are driven
by a pure utilitarian motive. Functionality is of prime importance.
Simplistic in its style, the interior design of an average house would
often consist of stone or mosaic ooring, painted walls, colonia
furniture handed down for generations, and local arts and crafts
adorning the walls.
Over the years, architects took on the responsibility of furnishing a
space and designed every aspect that went to its conception from the
furniture to the art work to the tapestries. However, this level of
comfort, amenities and beauty, were restricted to spaces belonging to
the rich.
Over the last decade, urban India has grown leaps and bounds, from
the failing third world country it once was. India is now one of the
worlds largest democracies and its continuous growth despite the
global meltdown has put money into the hands of the middle class
youth who are now living a lifestyle their parents had only dreamed
of. A well planned, professionally designed space is now well within

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their grasp and its being reected in the growing industry of Interior
design.
1.2. M. AN INTRODUCTION TO THE INTERIOR DESIGN
INDUSTRY
Interior Design, as a separate specialised design discipline, is a
relatively new eld in India. It has now been recognized as a
profession different from decorators and architects dominating the
eld for historic reason. Today, Interior design in India has come a
long way. It has gained autonomy from Architecture and is not just
reduced to decoration and furnishings anymore. Interior Design sees
space as a living environment and is a holistic resolution of the sociocultural, emotional and resource conditions of the context it
represents.
In the context of design, Interiors refers to any space within an
enclosed structure that is inhabitable and human centred. These spaces
include residences, ofces, institutions, schools, hospitals, theatres,
restaurants, hotels and resorts, airports and the like. This context also
spills onto the structures extensions such as porches, entrances,
swimming pools, landscaped areas, decks, patios etc.
The scope is so diverse in todays times, that the aspects of Interior
Design encompass all those contexts and more. This has led to Interior
Designs fragmentation into a variety of specialized micro-disciplines
such as Residential Design, Office Design, Retail and Commercial
Design, and Hospitality Design.

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1.2. N. TYPES OF INTERIOR DESIGN PROJECT

Interior design encompasses a variety of disciplines including
workplace, retail, healthcare, hospitality and residential design.
Whether you're ready to evaluate, renovate, or establish a new facility,
hiring a professional interior designer is a wise investment in the
successful outcome of a project. Types of interior design projects are

Fig 1.3 Types of Interior Design project

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RESIDENTIAL DESIGN
Thinking of buying a condominium or a house and can't
understand the builder's floor plans and how they will work for you?
Whether you are updating a bathroom or kitchen, planning a major
renovation or looking to add an extension to your home, an interior
designer can help you realize your design dream. An interior designer
will guide you through the process of choosing the right floor plan and
finishes.
Interior design begins with you. Our members are skilled at analyzing
the needs, goals, lifestyle and safety requirements of their clients and
integrating them into a functional and aesthetically attractive design
concept. Interior designers have unique training in designing interior
environments and are able to provide a full scope of services to
complete the project on time and on budget.
By hiring a professional interior designer for your next project, you're
adding value to your home, minimizing risk and keeping costs down.
Plus, with fees making up only a small portion of the overall real
estate/construction costs, hiring a qualified interior designer is a wise
investment in the successful outcome of your project.
WORKPLACE DESIGN
A well-designed corporate space or workplace environment can
potentially improve quality of life, promote productivity and increase

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employee retention. Working with a professional interior designer is a

sound business decision and the best way to ensure you get value for
your investment.
Have peace of mind in knowing that your project will meet the needs
of your business, be both functional and aesthetically pleasing and
make the most of available space. Our members can help guide you
through

building

technology, ergonomics,

environmental

and

sustainability issues, local building and fire codes as well as

accessibility guidelines. On more extensive corporate and workplace
environment projects, your interior designer may also:
Act as Project Manager on your behalf to manage the project teams
through all phases of the project
Develop and implement a branding and communications strategy in
relation to the project
Undertake feasibility studies on potential facilities and coordinate
with real estate professionals
Prepare and administer bids and contract documents as your agent
RETAIL DESIGN
Looking to maximize your display space and create a unique
shopping experience for your customers? Help ensure that your clients
have a memorable experience in your retail space by hiring a

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professional interior designer. An interior designer is equipped to

realize your goals and make the interior environment of your business
effective and attractive. Rolling out several stores of the same brand?
Interior designers are skilled at taking one brand and design concept
and adapting it to multiple locations.
Whether renovating, relocating, evaluating or establishing a new retail
facility, working with an interior designer is one of the best
investments a business owner can make. An interior designer will add
value to your facility, minimize risk and keep project costs down.
They ensure that the design complies with all regulatory and legal
requirements and that the health, safety and welfare of employees and
clients are protected. Plus, with fees making up a small portion of the
overall real estate/construction costs, hiring a qualified interior
designer can be an affordable investment in the successful outcome of
your project.
HEALTHCARE DESIGN
Interior design is much more than aesthetics. Well thought out
health-care spaces make a positive difference in the lives of patients
and employees, help ease the stress of medical visits, and ultimately
affect patient healing. Healthcare design encompasses not only
hospital environments but also general practice, dental and other
specialist offices as well as long-term care facilities. Whatever your
project needs, working with a professional interior designer will help

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you realize a facility that meets the needs of staff and patients while
respecting strict infection control and building codes.
HOSPITALITY DESIGN
Want to be on the top ten lists of hotels, restaurants and bars?
Consider design a key business strategy to pull customers into your
hospitality space.
Whether on holiday at a hotel or spa, or just out for a night on the
town, great hospitality design can shape a client's experience. Whether
you're renovating or constructing a new facility, working with a
professional interior designer can ensure that your clients have a
memorable experience in your space.
Most importantly, you'll be adding value to your project by maintains
project costs and minimizing risk by ensuring that the design complies
with all regulatory and legal requirements and protects the health,
safety and welfare of the occupants. At the end of the day, hiring a
qualified interior designer is a wise investment in the successful
outcome of your project.

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PART- B: - ABOUT THE SUBJECT:Introduction about the subject

Ratio Analysis:Fundamental Analysis has a very broad scope. One aspect looks at the
general (qualitative) factors of a company. The other side considers
tangible and measurable factors (quantitative). This means crunching
and analyzing numbers from the financial statements. If used in
conjunction with other methods, quantitative analysis can produce
excellent results.
Ratio analysis isn't just comparing different numbers from the balance
sheet, income statement, and cash flow statement. It's comparing the
number against previous years, other companies, the industry, or even
the economy in general. Ratios look at the relationships between
individual values and relate them to how a company has performed in
the past, and might perform in the future.
MEANING OF RATIO:

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A ratio is one figure express in terms of another figure. It is a

mathematical yardstick that measures the relationship two figures,
which are related to each other and mutually interdependent. Ratio is
express by dividing one figure by the other related figure. Thus a ratio
is an expression relating one number to another. It is simply the
quotient of two numbers. It can be expressed as a fraction or as a
decimal or as a pure ratio or in absolute figures as so many times.
As accounting ratio is an expression relating two figures or accounts
or two sets of account heads or group contain in the financial
statements.
MEANING OF RATIO ANALYSIS:
Ratio analysis is the method or process by which the relationship of
items or group of items in the financial statement are computed,
determined and presented.
Ratio analysis is an attempt to derive quantitative measure or guides
concerning the financial health and profitability of business
enterprises. Ratio analysis can be used both in trend and static
analysis. There are several ratios at the disposal of an analyst but their
group of ratio he would prefer depends on the purpose and the
objective of analysis.
While a detailed explanation of ratio analysis is beyond the scope of
this section, we will focus on a technique, which is easy to use. It can
provide you with a valuable investment analysis tool.

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This technique is called cross-sectional analysis. Cross-sectional

analysis compares financial ratios of several companies from the same
industry. Ratio analysis can provide valuable information about a
company's financial health. A financial ratio measures a company's
performance in a specific area. For example, you could use a ratio of a
company's debt to its equity to measure a company's leverage. By
comparing the leverage ratios of two companies, you can determine
which company uses greater debt in the conduct of its business. A
company whose leverage ratio is higher than a competitor's has more
debt per equity. You can use this information to make a judgment as to
which company is a better investment risk.
However, you must be careful not to place too much importance on
one ratio. You obtain a better indication of the direction in which a
company is moving when several ratios are taken as a group.
OBJECTIVE OF RATIOS
Ratio is work out to analyze the following aspects of business
organizationA) Solvency1) Long term
2) Short term
3) Immediate
B) Stability
C) Profitability

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D) Operational efficiency
E) Structural analysis
F) Effective utilization of resources
G) Leverages or external financing
STEPS IN RATIO ANALYSIS
The ratio analysis requires two steps as follows:
1] Calculation of ratio
2] Comparing the ratio with some predetermined standards. The
standard ratio may be the past ratio of the same firm or industrys
average ratio or a projected ratio or the ratio of the most successful
firm in the industry. In interpreting the ratio of a particular firm, the
analyst cannot reach any fruitful conclusion unless the calculated ratio
is compared with some predetermined standard. The importance of a
correct standard is oblivious as the conclusion is going to be based on
the standard itself.
TYPES OF COMPARISONS
The ratio can be compared in three different ways
1] Cross section analysis:
One of the way of comparing the ratio or ratios of the firm is to
compare them with the ratio or ratios of some other selected firm in

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SHREEJI ASIA

the same industry at the same point of time. So it involves the

comparison of two or more firms financial ratio at the same point of
time. The cross section analysis helps the analyst to find out as to how
a particular firm has performed in relation to its competitors. The
firms performance may be compared with the performance of the
leader in the industry in order to uncover the major operational
inefficiencies. The cross section analysis is easy to be undertaken as
most of the data required for this may be available in financial
statement of the firm.

2] Time series analysis:

The analysis is called Time series analysis when the performance of a
firm is evaluated over a period of time. By comparing the present
performance of a firm with the performance of the same firm over the
last few years, an assessment can be made about the trend in progress
of the firm, about the direction of progress of the firm. Time series
analysis helps to the firm to assess whether the firm is approaching the
long-term goals or not. The Time series analysis looks for (1)
important trends in financial performance (2) shift in trend over the
years (3) significant deviation if any from the other set of data.
3] Combined analysis:

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SHREEJI ASIA

If the cross section & time analysis, both are combined together to
study the behavior & pattern of ratio, then meaningful &
comprehensive evaluation of the performance of the firm can
definitely be made. A trend of ratio of a firm compared with the trend
of the ratio of the standard firm can give good results. For example,
the ratio of operating expenses to net sales for firm may be higher
than the industry average however, over the years it has been
declining for the firm, whereas the industry average has not shown
any significant changes

BASED ON FINANCIAL STATEMENT

Accounting ratios express the relationship between figures taken from
financial statements. Figures may be taken from Balance Sheet, P& L
A/C, or both. One-way of classification of ratios is based upon the
sources from which are taken.
1] Balance sheet ratio:
If the ratios are based on the figures of balance sheet, they are called
Balance Sheet Ratios. E.g. ratio of current assets to current liabilities
or ratio of debt to equity. While calculating these ratios, there is no
need to refer to the Revenue statement. These ratios study the

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SHREEJI ASIA

relationship between the assets & the liabilities, of the concern. These
ratio help to judge the liquidity, solvency & capital structure of the
concern. Balance sheet ratios are Current ratio, Liquid ratio, and
Proprietary ratio, Capital gearing ratio, Debt equity ratio, and Stock
working capital ratio.
2] Revenue ratio:
Ratio based on the figures from the revenue statement is called
revenue statement ratios. These ratios study the relationship between
the profitability & the sales of the concern. Revenue ratios are Gross
profit ratio, Operating ratio, Expense ratio, Net profit ratio, Net
operating profit ratio, Stock turnover ratio.

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SHREEJI ASIA

3] Composite ratio:
These ratios indicate the relationship between two items, of which one
is found in the balance sheet & other in revenue statement.

BASED ON FUNCTION:
Accounting ratios can also be classified according to their functions in
to liquidity ratios, leverage ratios, activity ratios, profitability ratios &
turnover ratios.
1] Liquidity ratios:
It shows the relationship between the current assets & current
liabilities of the concern e.g. liquid ratios & current ratios.
2] Leverage ratios:
It shows the relationship between proprietors funds & debts used in
financing the assets of the concern e.g. capital gearing ratios, debt
equity ratios, & Proprietary ratios.
3] Activity ratios:
It shows relationship between the sales & the assets. It is also known
as Turnover ratios & productivity ratios e.g. stock turnover ratios,
debtors turnover ratios.

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SHREEJI ASIA

4] Profitability ratios:
a It shows the relationship between profits & sales e.g. operating
ratios, gross profitratios, operating net profit ratios, expenses
ratios
b It shows the relationship between profit & investment e.g.
return on investment, return on equity capital.
5] Coverage ratios:
It shows the relationship between the profit on the one hand & the
claims of the outsiders to be paid out of such profit e.g. dividend
payout ratios & debt service ratios.

BASED ON USER:
1] Ratios for short-term creditors:
Current ratios, liquid ratios, stock working capital ratios
2] Ratios for the shareholders:
Return on proprietors fund, return on equity capital
3] Ratios for management:

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SHREEJI ASIA

Return on capital employed, turnover ratios, operating ratios,

expenses ratios
4] Ratios for long-term creditors:
Debt equity ratios, return on capital employed, proprietor ratios.

LIQUIDITY RATIO: Liquidity refers to the ability of a firm to meet its short-term (usually
up to 1 year) obligations. The ratios, which indicate the liquidity of a
company, are Current ratio, Quick/Acid-Test ratio, and Cash ratio.
These ratios are discussed below:CURRENT RATIO
Meaning:
This ratio compares the current assets with the current liabilities. It is
also known as working capital ratio or solvency ratio. It is
expressed in the form of pure ratio.
E.g. 2:1
Formula:

Current assets
Current ratio =
Current liabilities

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SHREEJI ASIA

LIQUID RATIO:
Meaning:
Liquid ratio is also known as acid test ratio or quick ratio. Liquid ratio
compares the quick assets with the quick liabilities. It is expressed in
the form of pure ratio. E.g. 1:1.
The term quick assets refer to current assets, which can be converted
into, cash immediately or at a short notice without diminution of
value.
Formula:
Quick assets
Liquid ratio =
Quick liabilities

CASH RATIO

Meaning:
This is also called as super quick ratio. This ratio considers only the
absolute liquidity available with the firm.
Formula:

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SHREEJI ASIA

Cash + Bank + Marketable securities

Cash ratio

=
Total current liabilities

EARNING PER SAHRE:Meaning:Earnings per Share are calculated to find out overall profitability of
the organization. Earnings per Share represent earning of the company
whether or not dividends are declared. If there is only one class of
shares, the earning per share are determined by dividing net profit by
the number of equity shares.
EPS measures the profits available to the equity shareholders on each
share held.
Formula:
NPAT
Earnings per share =
Number of equity share

DIVIDEND PER SHARE:-

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SHREEJI ASIA

Meaning:
DPS shows how much is paid as dividend to the shareholders on each
share held.

Formula:
Dividend Paid to Ordinary Shareholders
Dividend per Share =
Number of Ordinary Shares

DIVIDEND PAYOUT RATIO:Meaning:

Dividend Pay-out Ratio shows the relationship between the dividend
paid to equity shareholders out of the profit available to the equity
shareholders
.Formula:
Dividend per share
Dividend Payout ratio =

100

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SHREEJI ASIA

Earnings per share

CAPITAL GEARING RATIO:Meaning:

Gearing means the process of increasing the equity shareholders
return through the use of debt. Equity shareholders earn more when
the rate of the return on total capital is more than the rate of interest
on debts. This is also known as leverage or trading on equity. The
Capital-gearing ratio shows the relationship between two types of
capital viz: - equity capital & preference capital & long term
borrowings. It is expressed as a pure ratio.

Formula:Preference capital+ secured loan

Capital gearing ratio =
capital & reserve & surplus

GROSS PROFIT RATIO:-

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SHREEJI ASIA

Meaning:
This ratio measures the relationship between gross profit and sales. It
is defined as the excess of the net sales over cost of goods sold or
excess of revenue over cost. This ratio shows the profit that remains
after the manufacturing costs have been met. It measures the
efficiency of production as well as pricing. This ratio helps to judge
how efficient the concern is I managing its production, purchase,
selling & inventory, how good its control is over the direct cost, how
productive the concern , how much amount is left to meet other
expenses & earn net profit.
Formula:
Gross profit
Gross profit ratio =

100
Net sales

NET PROFIT RATIO:Meaning:

Net Profit ratio indicates the relationship between the net profit & the
sales it is usually expressed in the form of a percentage
Formula:

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SHREEJI ASIA

NPAT
Net profit ratio =

100
Net sales

RETURN ON CAPITAL EMPLOYED:Capital employed refers to the long-term funds invested by the
creditors and the owners of a firm. It is the sum of long-term liabilities
and owner's equity. ROCE indicates the efficiency with which the
long-term funds of a firm are utilized.
Formula:
NPAT
Return on capital employed =

100
Capital employed

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SHREEJI ASIA

DEBTORS TURNOVER RATIO (DTO)

Meaning:
DTO is calculated by dividing the net credit sales by average debtors
outstanding during the year. It measures the liquidity of a firm's debts.
Net credit sales are the gross credit sales minus returns, if any, from
customers. Average debtors are the average of debtors at the beginning
and at the end of the year. This ratio shows how rapidly debts are
collected. The higher the DTO, the better it is for the organization.

Formula:
Credit sales
Debtors turnover ratio =
Average debtors

INVENTORY OR STOCK TURNOVER RATIO (ITR)

Meaning:
ITR refers to the number of times the inventory is sold and replaced
during the accounting period.
Formula:
COGS
Stock Turnover Ratio =
Average stock

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SHREEJI ASIA

FIXED ASSETS TURNOVER (FAT)

The FAT ratio measures the net sales per rupee of investment in fixed
assets.
Formula:
Net sales
Fixed assets turnover =
Net fixed assets

PROPRIETORS RATIO:
Meaning:
Proprietary ratio is a test of financial & credit strength of the business.
It relates shareholders fund to total assets. This ratio determines the
long term or ultimate solvency of the company.
In other words, Proprietary ratio determines as to what extent the
owners interest & expectations are fulfilled from the total investment
made in the business operation.
Proprietary ratio compares the proprietor fund with total liabilities. It
is usually expressed in the form of percentage. Total assets also know
it as net worth. The Formula is:Shareholders fund

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SHREEJI ASIA

Proprietary ratio =
Fixed assets + current liabilities

STOCK WORKING CAPITAL RATIO:

Meaning:
This ratio shows the relationship between the closing stock & the
working capital. It helps to judge the quantum of inventories in
relation to the working capital of the business. The purpose of this
ratio is to show the extent to which working capital is blocked in
inventories. The ratio highlights the predominance of stocks in the
current financial position of the company. It is expressed as a
percentage.
Formula:
Stock
Stock working capital ratio =
Working Capital

DEBT EQUITY RATIO:

MEANING:

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SHREEJI ASIA

This ratio compares the long-term debts with shareholders fund. The
relationship between borrowed funds & owners capital is a popular
measure of the long term financial solvency of a firm. This
relationship is shown by debt equity ratio. Alternatively, this ratio
indicates the relative proportion of debt & equity in financing the
assets of the firm. It is usually expressed as a pure ratio. E.g. 2:1
Formula:
Total long-term debt
Debt equity ratio =
Total shareholders fund

RETURN ON PROPRIETOR FUND

Meaning:
Return on proprietors fund is also known as return on proprietors
equity or return on shareholders investment or investment ratio.
This ratio indicates the relationship between net profits earned & total
proprietors funds. Return on proprietors fund is a profitability ratio,
which the relationship between profit & investment by the proprietors
in the concern. Its purpose is to measure the rate of return on the total
fund made available by the owners. This ratio helps to judge how
efficient the concern is in managing the owners fund at disposal. This

44

SHREEJI ASIA

ratio is of practical importance to prospective investors &

shareholders.
Formula:

NPAT
Return on proprietors fund =

100
Proprietors fund

CREDITORS TURNOVER RATIO:

Meaning:-

It is same as debtors turnover ratio. It shows the speed at which

payments are made to the supplier for purchase made from them. It is
a relation between net credit purchase and average creditors
Formula:Net credit purchase
Credit turnover ratio =
Average creditors

IMPORTANCE OF RATIO ANALYSIS:

As a tool of financial management, ratios are of crucial
significance. The importance of ratio analysis lies in the fact that it
presents facts on a comparative basis & enables the drawing of
interference regarding the performance of a firm. Ratio analysis is

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SHREEJI ASIA

relevant in assessing the performance of a firm in respect of the

following aspects:
1] Liquidity position,
2] Long-term solvency,
3] Operating efficiency,
4] Overall profitability,
5] Inter firm comparison
6] Trend analysis.
1] LIQUIDITY POSITION: With the help of Ratio analysis conclusion can be drawn
regarding the liquidity position of a firm. The liquidity position of a
firm would be satisfactory if it is able to meet its current obligation
when they become due. A firm can be said to have the ability to meet
its short-term liabilities if it has sufficient liquid funds to pay the
interest on its short maturing debt usually within a year as well as to
repay the principal. This ability is reflected in the liquidity ratio of a
firm. The liquidity ratio is particularly useful in credit analysis by
bank & other suppliers of short term loans.
2] LONG TERM SOLVENCY: Ratio analysis is equally useful for assessing the long-term financial
viability of a firm. This respect of the financial position of a borrower

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SHREEJI ASIA

is of concern to the long-term creditors, security analyst & the present

& potential owners of a business. The long-term solvency is measured
by the leverage/capital structure & profitability ratio analysis that
focus on earning power & operating efficiency..
3] OPERATING EFFICIENCY:
Yet another dimension of the useful of the ratio analysis, relevant
from the viewpoint of management, is that it throws light on the
degree of efficiency in management & utilization of its assets. The
various activity ratios measure this kind of operational efficiency. In
fact, the solvency of a firm is, in the ultimate analysis, dependent
upon the sales revenues generated by the use of its assets- total as well
as its components.
4] OVERALL PROFITABILITY:
Unlike the outsides parties, which are interested in one aspect of the
financial position of a firm, the management is constantly concerned
about overall profitability of the enterprise. That is, they are
concerned about the ability of the firm to meets its short term as well
as long term obligations to its creditors, to ensure a reasonable return
to its owners & secure optimum utilization of the assets of the firm.
This is possible if an integrated view is taken & all the ratios are
considered together.
5] INTER FIRM COMPARISON:

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SHREEJI ASIA

Ratio analysis not only throws light on the financial position of firm
but also serves as a stepping-stone to remedial measures. This is made
possible due to inter firm comparison & comparison with the industry
averages. A single figure of a particular ratio is meaningless unless it
is related to some standard or norm. One of the popular techniques is
to compare the ratios of a firm with the industry average. It should be
reasonably expected that the performance of a firm should be in broad
conformity with that of the industry to which it belongs. An Inter firm
comparison would demonstrate the firms position vice-versa its
competitors. If the results are at variance either with the industry
average or with those of the competitors, the firm can seek to identify
the probable reasons & in light, take remedial measures.
6] TREND ANALYSIS:
Finally, ratio analysis enables a firm to take the time dimension into
account. In other words, whether the financial position of a firm is
improving or deteriorating over the years. This is made possible by
the use of trend analysis. The significance of the trend analysis of
ratio lies in the fact that the analysts can know the direction of
movement, that is, whether the movement is favorable or unfavorable.
For example, the ratio may be low as compared to the norm but the
trend may be upward. On the other hand, though the present level may
be satisfactory but the trend may be a declining one.

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LIMITATIONS OF RATIO ANALYSIS

Ratio analysis has its limitations. These limitations are described
below:
1] Information problems
Ratios require quantitative information for analysis but it is not
decisive about analytical output.
The figures in a set of accounts are likely to be at least several
months out of date, and so might not give a proper indication of
the companys current financial position.
Where historical cost convention is used, asset valuations in the
balance sheet could be misleading. Ratios based on this
information will not be very useful for decision-making.
2] Comparison of performance over time
When comparing performance over time, there is need to
consider the changes in price. The movement in performance
should be in line with the changes in price.
When comparing performance over time, there is need to
consider the changes in technology. The movement in
performance should be in line with the changes in technology.
Changes in accounting policy may affect the comparison of
results between different accounting years as misleading.
3] Inter-firm comparison

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SHREEJI ASIA

Companies may have different capital structures and to make

comparison of performance when one is all equity financed and
another is a geared company it may not be a good analysis.
Selective application of government incentives to various
companies

may

also

distort

intercompany

comparison.

Comparing the performance of two enterprises may be

misleading.
Inter-firm comparison may not be useful unless the firms
compared are of the same size and age, and employ similar
production methods and accounting practices.
Even within a company, comparisons can be distorted by
changes in the price level.
Ratios provide only quantitative information, not qualitative
information.
Ratios are calculated on the basis of past financial statements.
They do not indicate future trends and they do not consider
economic conditions.

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RESEARCH DESIGN
A research design is a logical systematic plan prepared for directing a
research study. it specifies the
objectives of the study, the
methodology and the techniques to be adopted for achieving the
objective.
2.1 TITLE OF THE STUDY:
A study on Ratio Analysis of SHREEJI INTERIORS
2.2 STATEMENT OF THE PROBLEM:-

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SHREEJI ASIA

From last three years SHREEJI INTERIORS is facing the problem of

the profit due to some financial
reason. In this project some of the
problems have identified by using ratio formulas.
2.3 OBJECTIVES OF THE STUDY:

To study
INTERIORS"

liquidity

solvency

position

of

"

SHREEJI

To study understand financial performance through ratio

analysis.

To study present and future earning capacity or profitability of

the concern.

2.4 SCOPE OF THE STUDY:

The study is confined only to the information provided by finance and
accounts department of " SHREEJI INTERIORS" and further the
study has been restricted to financial analysis through accounting
ratios only. This study supported by the companys last three years
balance sheet.
2.5 REVIEW OF LITERATURE
Financial statements Analysis:
The financial statements of SHREEJI INTERIORS provide some
extremely useful information to the extent that the balance sheet
mirrors the financial position on a particular date in terms of the
structure of assets, liabilities and owners capital and so on and the
profit and loss account shows the results of operations during a certain
period of time in terms of the revenues obtained and the cost incurred
during the year. Thus, the financial statements provide a summarized
view of the financial position and operations of a firm. Therefore,

52

SHREEJI ASIA

much learnt about a firm from a careful examination of its financial

statements as invaluable documents performance reports. The analysis
of financial statements is thus, an important aid to financial
analysis.The focus of financial analysis is on key figures in the
financial statements and the significant relationship that exists
between them. The analysis of financial statements is a process of
evaluating the relationship between component parts of financial
statements to obtain a better understanding of the firms position and
performance. The first task of the financial analyst is to select the
information relevant to the decision under consideration from the total
information contained in the financial statements. The second step is
to arrange the information in a way to highlight significant
relationships.
2.6 OPERATIONAL DEFNITIONS:
1] Assets: An asset is a resource controlled by the entity as a result of
past events and from which future economic benefits are expected to
flow to the entity.
2] Liabilities: An obligation of an entity arising from past transactions
or events, the settlement of which may result in the transfer or use of
assets, provision of services or other yielding of economic benefits in
the future.
3] Long Term Liabilities: The long-term liabilities are shown on the
right wing of the balance-sheet representing the sources of funds,
which are generally bounded in form of capital assets.
4] Current Liabilities: A banks debts or obligations payable within
one year. Current liabilities appear on the banks balance sheet and
include short term debt, accounts payable, accrued liabilities, and
other debts.

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SHREEJI ASIA

5] Expenses: The economic costs that a business incurs through its

operations to earn revenue. In order to maximize profits, businesses
must attempt to reduce expenses without also cutting into revenues.
Because expenses are such an important indicator of a business's
operations, there are specific accounting rules on expense recognition.
6] Balance Sheet: A financial statement that summarizes a banks
assets, liabilities and shareholders' equity at a specific point in time.
These three balance sheet segments give investors an idea as to what
the bank owns and owes, as well as the amount invested by the
shareholders.
7] Current Ratio: A liquidity ratio that measures a company's ability
to pay short-term obligations.
The Current Ratio formula is:
Current assets
Current ratio = --------------------------Current liabilities
8] Quick Ratio/ Liquid Ratio: An indicator of a company's shortterm liquidity. The quick ratio measures a company's ability to meet
its short-term obligations with its most liquid assets.
The quick ratio is calculated as:
Current assets - Inventories
Quick ratio =

---------------------------------Current liabilities

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SHREEJI ASIA

9] Absolute Liquid Ratio: Absolute liquid ratio extends the logic

further and eliminates accounts receivable (sundry debtors and bills
receivables) also. Though receivables are more liquid as comparable
to inventory but still there may be doubts considering their time and
amount of realization. Therefore, absolute liquidity ratio relates cash,
bank and marketable securities to the current liabilities. Since absolute
liquidity ratio lays down very strict and exacting standard of liquidity,
therefore, acceptable norm of this ratio is 50 percent. It means
absolute liquid assets worth one half of the value of current liabilities
are sufficient for satisfactory liquid position of a business. However,
this ratio is not as popular as the previous two ratios discussed.
10] Debt-Equity Ratio: A measure of a company's financial leverage
calculated by dividing its total liabilities by stockholders' equity. It
indicates what proportion of equity and debt the company is using to
finance its assets.
Formula:-

Total liability

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SHREEJI ASIA

Debt-Equity Ratio =

------------------------------Shareholder Equity

13] Inventory Turnover Ratio: A ratio showing how many times a

company's inventory is sold and replaced over a period. The days in
the period can then be divided by the inventory turnover formula to
calculate the days it takes to sell the inventory on hand or "inventory
turnover days".
The formula is:Sales
Inventory Turnover Ratio = ----------------------Inventory

14] Debtors Turnover Ratio: An accounting measure used to

quantify a firm's effectiveness in extending credit as well as collecting
debts. The receivables turnover ratio is an activity ratio, measuring
how efficiently a firm uses its assets.
Formula:

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SHREEJI ASIA

Net credit annul sales

Debtors turnover ratio = --------------------------------Average trade debt

2.7 SOURCES OF DATA:

Primary Data:The data is collected through discussions with the finance manager
and financial heads of the company.

Secondary Data:The primary data obtained has been supported with use of secondary
data collected from the books, annual reports, financial statements,
periodicals and other sources have been referred for data collection.
2.8 SAMPLE DESIGN:
It denotes the number of people surveyed actually and this sample size
will be taken by adopting some type of sampling technique.
Companies last three years of balance sheet as a sample three years
balance sheet was taken on the basis of convenience.
2.9 METHODOLOGY:-

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SHREEJI ASIA

No series assumptions so far were made as to limit the usefulness of

the study was made at any stage. However the following were made.

A study period of three years.

The study has conducted through the balance sheet of the

organization.

The solution has been found through the respective formula and
then by the analysis and interpretation the conclusion has been
provided to the organization.
2.10 TOOLS FOR DATA COLLECTION
The data collected from the various sources has to be processed and
analyzed systematically.
These includes such as:
Identification of the absolute increase or decrease in the various
assets and liabilities, reflecting the performance of the company.
Identification of the percentage chain in the assets and liabilities in
the balance sheets of three years.
Application of ratio analysis and trained analysis of the period of
the study.
Calculation of the various ratios reflecting the profitability,
liquidity position of the company for the period of the study.
Finally, forwarding suggestions and conclusions. The above is the
analysis plan for the research.
2.11 PLAN OF ANALYSIS:-

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SHREEJI ASIA

The data collected from the organization has been analyzed according
to the objectives to the study. For this purpose a statistical tool ratio
analysis are used along with the bar diagrams.
2.12 REFERENCE PERIOD:The accounts, various records and reports for period of three years are
being referred for the purpose of the study.
2.13 LIMITATIONS OF THE STUDY
1.
The analysis is based on the information available from the
company therefore the results depend on the accuracy of the reports of
the company.
2.

It is purely academic in the nature.

3.
The analysis and the findings are related to SHREEJI
INTERIORS and hence the findings cannot be generalized to other
organization.
4.
Based on the limited information it is not possible to arrive at
proper conclusion.
5.
The inferences that have been framed only on the basis of
financial statements.

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2.14 CHAPTER SCHEME:Chapter- 1: Introduction

This chapter includes the subjects background of research with
respect to the industry and the theory cal background of the subject.
Chapter- 2: Research design
It comprises of brief introduction of the problem, objectives of the
study, operational definitions, sampling tools of data and method
analysis, limitations of chapter layout.
Chapter- 3: Company profile

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SHREEJI ASIA

This chapter reveals the company growth and development in the

present scenario. It also contains the complete history of the company.
Chapter- 4: Data Analysis and Interpretation
This chapter gives the comprehensive analysis with respect to the
collected data and diagram call representation.
Chapter- 5: Summery Findings and Conclusion
This chapter gives the summery of the analysis and interpretation,
valid findings of the study.
Chapter- 6: Recommendation and Suggestions
This chapter contains the suggestions as well as conclusions on the
base of the study conducted.

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1.3

COMPANY PROFILE

The Shreeji Group, since 2001, is a premier real estate

development company that focuses on multi-family residential, &
redevelopment projects. With the primary business being the
development of properties in residential, commercial and retail

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SHREEJI ASIA

sectors, the company's operations span across various aspects of

real estate development, such as
Land Identification and Acquisition,

Project Planning,

Designing,

Marketing & Execution,

Property Services and Estate Management.

Shreeji Asia Pvt. Ltd. Is one of the most diversified construction

groups with activities across India, covering development of
commercial

buildings,

residential

land

and designing

false

ceilings, and most other works related to the development of

classy global interiors.

Shreeji Asia Pvt. Ltd. Is the parent company having two

verticals under it, that is,
1. Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd.
2. Shreeji Interiors.

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SHREEJI ASIA

Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd. Is involved in

development of Infrastructure Projects with safety, reliability and
quality as their key principles. Shreeji Interiors is involved in
executing designs in terms of Furnishing, Civil, False Ceilings,
Flooring, Carpentry, Electrical and other works related to the
development of Interiors.
The company also has Malur Facility which is used to develop
designs in large area, in minimum time frame and with
precision.

The

company

has

four

main

departments

i.e.

Business

Development, Purchase, Accounts and Human Resource. All the

departments work in accordance with each other in acquiring &
successfully completing the project. The Business Development
Department is responsible for bringing the projects to the
company. After

the

company

gets

project,

the Purchase

Department start purchasing the material required on the site and

Accounts Department maintains the documents in Tally ERP 9
and MS Excel. The complete process of acquiring and executing
a project starts with market research. The Business Development
Department make calls to the companies that are expanding or
planning to expand in future. Various sources to get the name of
the companies are Internet, Newspapers, Magazines, Personal
Contacts, Friends and Acquaintances. The details of the calls

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SHREEJI ASIA

made to the companies are entered in a database Name of the

contact person, companys address, call details, Name of the
person in charge of the upcoming project, contact number of the
person in- charge etc. Calls are made to the prospective clients
and Database is updated on the daily basis.
1.3. A. Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd.
SPI (ASIA) PVT. LTD. Is a part of SHREEJI ASIA that is
dedicated to execution of infrastructure projects. Over years we
have developed expertise in building structures for commercial,
industrial

and

residential purposes,

delivering

products

and

services of international standards. We have executed landmarks,

which are sky- high and cater to the most respectable members
of the society.
Having a deep understanding of the industry, technical and
financial aspects of investment projects, being aware of daily
challenges faced during execution of projects and the importance
of timely completion of work, we implement advanced planning
and risk management to not only meet but very often exceed
our Client's expectations. We believe that this is the way we
make a difference in the industry.
Our highly dedicated Operations Team consists of experienced
Project Managers, Site Engineers, Site Supervisors and more
than 500 skilled laborers, who cooperate with our Support Team

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SHREEJI ASIA

to assure smooth and timely completion of the assigned projects.

Thanks to wise investments we have high- tech plant and
machinery at our disposal that supports us in delivering the best
quality products within the specified time frame. We cooperate
with a wide net of reliable suppliers to assure timely deliveries
and required quality of materials. Furthermore the quality of
materials and our work is internally supervised on a daily basis,
because at SHREEJI ASIA, we do not compromise on quality.
Treating safety of our employees and work as a priority, we
have implemented our own safety regulations and pride ourselves
in having 100% safety record since the inception of the
Company.
1.3.B. Shreeji Interiors
At SHREEJI INTERIORS, we have developed exclusive expertise
in executing design in terms of civil work, false ceilings, flooring,
carpentry, electrical, plumbing, air-conditioning, painting, furnishing
and most other works related to the development of classy interiors. In
the process we have also developed a sustained understanding of the
aesthetical and functional demands of the market in terms of
distinctive

architecture,

interiors

and

decor.

All work is carried out under stringent supervision of our qualified

Project Managers and a vast strong Support Team. We are currently
among the leading companies engaged in carrying out turnkey interior
projects with the factory setup of about 1 lakh sft, which is equipped
with the latest European technology available.

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SHREEJI ASIA

Our varied list of Clients speaks for our ability to carry out
challenging jobs within the required time frame as your project moves
from abstraction to physical reality. The key to our excellence is
enabling you to express your individuality and bring your concepts
from drawings to life. Our hands-on approach is consistent from
project's

inception,

throughout

construction

until

completion.

Any project is fraught with challenges and uncertainties. There are

numerous decisions to be made which have a strong impact on how
the project looks and functions over period of time. Choosing the right
company makes all the difference between satisfactory jobs and great
jobs.
We believe in creating environment that are beautiful, functional and
cost-effective.
The company believes in creating a home or an office based on
an understanding of the stated and unstated consumer needs and
preferences. The company develops every property only after a
concentrated
consumer

and focused market research to determine the

needs

implemented

and

then

according

to

the

project

consumer

remarkably versatile profile.

The

developing,

managing

building

and

is

designed

preferences.

groups activities
properties.

In

With

and
a

comprise
addition,

the group also offers a wide range of allied services, for

individuals and companies.

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SHREEJI ASIA

More than a business venture, the Shreeji Group is a coming

together of ethically inclined professionals, with an abiding
commitment towards delivering value, to their customers and
stakeholders.
This convergence of diverse proficiencies, supported by moral
values,

has

resulted

in

unique

people-centric

business

philosophy. Be it consumers, associates, institutions or its

employees, Shreeji Group is focused on people and their welfare.
The core values of the group thus comprise innovation, design
excellence, timeliness, fair business practices and commitment
towards the environment. Above all the group realizes that, its
activities can result in better and happy communities.
The Shreeji Group therefore ensures that, consumer preferences
are

taken

into

account,

while

designing

and

developing

properties. As a natural consequence, architectural designs are

customized, to suit a location and enhance functionality and
beauty. The group also places an emphasis on ergonomics,
structural durability and strategic position of a site.
Shreejis people-centric projects invariably satisfy the aspirational
needs of people and the functional needs of corporate entities.
The legacy of outstanding projects has deservedly won them, the
abiding trust of its customers.

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SHREEJI ASIA

The Shreeji Group is renowned for ethical business practices and

transparency in all its dealings. The group encourages open
communications and periodically informs all parties about, the
stage -by- stage progress, of a project. The company is strongly
rooted by the core values T.R.U.S.T. - The foundation of our
business, developed by being honest in all our dealings and
actions.
Teamwork
To maximize efforts, satisfaction and results by having
everybody working together toward a common goal.
Resiliency
To withstand the competitive and cyclical nature of our
industry

by

being

dynamic,

flexible,

innovative

and

operationally excellent.
Understanding
To meet clients' needs by first understanding our clients'
businesses and needs.
Service
To practice servant leadership and develop a serviceoriented culture at all levels.
Training
To be a learning organization that helps people realize their

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SHREEJI ASIA

full potential and provides promotional opportunities from

within.
1.3.D. Vision
They comprise utilizing the synergy, of the companys ethical
business philosophy, innovation and core competencies and
convert every project, into a value added proposition.
Every people-centric project, by the Shreeji Group, will thus
make use of quality building products, innovative designs and
modern

technology,

to

offer

the

consumer

world-class

experience.
1.3.E. Mission
To shape, manage, revive and nurture space, as a sacred
community resource and thus build, with an emphasis on
structural durability, functionality, ergonomics and aesthetics, for
a better quality of life.
1.3.F. Corporate Social Responsibility
The Shreeji Group believes that, individuals and corporate entities
are products of beneficial social forces.
The group assigns a specific part of its profit, to serve the
purpose of education and health for the underprivileged.

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We believe in nurturing & strengthening relationship with our

customers. We at Shreeji consider Trust, Respect, Loyalty &
Goodwill generated through Customer relationship Management as
our most valuable asset.

PRODUCTS PROFILE
Having been in the industry for a long time, the company understand
the demands of the market in terms of distinctive architecture and
dcor. Our highly dedicated and experienced Team is committed to
executing quality works, providing our Clients with customer-friendly
approach and true enthusiasm from project's planning stage till its
completion.
Products and Services

Infrastructure

Interiors

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SHREEJI ASIA

Factor

As per Client's requirements, our scope of work ranges in size and

complexity from routine renovation and maintenance works to the
construction of complete buildings structures and providing our
Clients with turnkey solutions; from modest office and retail
installations to state of the art interior fit outs. Apart from that we
deliver carpentry products and services that are in compliance with
international standards.
SHREEJI

PIPALIYA INFRASTRUCTURE

(ASIA)

PVT.

LTD. we serve a wide range of Clients, providing them with worldclass commercial, industrial and residential premises. Every year 80%
of our projects are executed for our repeat Clients, who look to SPI
(ASIA) to complete each assignment at an efficient, cost-effective and
professional manner.
At Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd. we own hightech equipment to support our performance in terms of time and
quality. We always keep in mind the precision and safety of our work,
therefore we use brand new machinery of world-class makers.

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To add to our competitiveness we have our own manufacturing

facilities of carpentry products. The machinery of European most
accredited brands and best carpenters assure that our products are
beautiful, functional and their quality exceeds international standards.
At SHREEJI INTERIORS, we service a whole range of Companies,
Architects and Interior Designers. We have very high standards for the
type of work we do and have lived up to the time frames and
standards set by our Clients.
COMMERCIAL
M/s. ABB
M/s. Accenture
M/s. Alcon Laboratories
M/s. Areva
M/s. Bagmane WTC 3
M/s. Embassy Tech Square
M/s. General Electric
M/s. Glow Network I & II
M/s. Gokuldas Export
M/s. Helion
M/s. iGATE
M/s. iOPEX
M/s. Lanco Hills
M/s. MOOG I & II
M/s. Motwani Builders Pvt. Ltd.

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SHREEJI ASIA

M/s. RMZ
M/s. TCS
M/s. Triveni
M/s. UST Global
M/s. VOLVO
HOSPITALITY
M/s. ABB Guesthouse
M/s. Desai Bro's Farmhouse
M/s. Esteem Silk Pvt. Ltd. Farmhouse
M/s. Hotel Royal Orchid (Doddis Resort)
M/s. Hotel Shelton Grand
RETAIL
M/s. Citi Bank
M/s. C Krishniah Chetty & Sons
M/s. Ducati
M/s. Kapoor Lamps
M/s. Levi's Museum Store
M/s. Neptune Travels
EDUCATION
M/s. British Library
RESIDENTIAL

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SHREEJI ASIA

M/s. Prestige - Acro Polis

M/s. Brigade Crescent
M/s. Brigade Exotica
M/s. Brigade Homestead
M/s. Brigade Mayfair
Mr. Deepak Motwani
Mr. Dinesh Hinduja
Mr. Jai Shankar
Mr. Kanti Bhura
Mr. Nandan Nilekani
Ms. Pavitra Shankar
Mr. Rajan Hinduja
Mr. Vijay Kumar Yadalam
CARPENTRY FACTORY
At SHREEJI ASIA, we are well aware of all the industrial
expectations and demands growing high. Having passion for creating
a landmark in the interior industry, we have made wise investments
into our Bangalore Factory. Our plant and machinery allows us to
deliver products matching or even exceeding the standards expected
by most demanding Clients from top end hospitality sector.
We manufacture a wide range of Furniture.
Modular furniture
Loose& fixed furniture
luxurious carpentry products

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SHREEJI ASIA

For corporate, residential and hospitality purposes. Our products are

distinguished by their functionality, user-friendliness and fine design.
Having control over the manufacturing process, we are able to deliver
carpentry products for a maximum area size within a minimum time
frame, assuring the best workmanship, quality and precision higher
than the European norms demand.
We are the first company in India to have the mentioned set of
European most renowned machinery. Together with our interest in
craftsmanship and detailing, passion and experience, we are now
capable of innovating the execution procedures and assuring a faster
delivery at a better price.
Interiors Factory- Unit I (87,412 Sft), Malur Industrial Area
Machinery
Interiors Factory- Unit II, Mysore Road
CNC
Machining Centre
Machinery
Computerized
Edge
Bender
NC Multi Boring
Machine
Computerized
Panel Saw
Post Forming Machine
Computerized
Profiling/
Shaping Machine
Wide Belt Sanding
Machine
Misc
other
machineries
Instant
Laminate/
Veneer Press
Misc other machineries

Nos.
1Nos.
11
22
11
61
8

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SHREEJI ASIA

COMPETITORS PROFILE
Competitor profiles enable us to see at a glance the information you
need on your competitors. Depending on the format and content, they
can provide anything from the background information required by
the sales force to the information that the board needs when
investigating potential acquisitions or deciding major strategic
initiatives against a competitor. The exact format will depend on your
needs and the key intelligence topics you want covered.
Each competitor profile should be customised so that the focus is on a
specific aspect. For example the sales force need to know your
competitive situation:
Who else is selling similar products and services?
How?
At what price?
Through which channel?
What promotional materials are used?
What sales tactics are used?
And so on.

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This sales focused kind of profile will include information that will
help your sales team to sell effectively answering customer queries
about your products or services compared to competitor equivalents,
However it would have no or less information on the competitor's
strategies, operations or finances. Such information would be included
in a profile drafted for senior / board level management, which might
have less of the sales-type data.
1.5.A. COMPETITORS
DESIGN ARC INTERIOR
Design Arc Interior is a highly revered interior dcor and interior
design company offering exclusive services in home interior
designing, commercial interior designing as well as 3D visualization
services to clients in Bangalore and Dubai. The teams of highly
skilled and respected interior designers in Design Arc Interior offer
their exclusive interior designing. A highly prolific interior designing
company specializing in residential space design, commercial spaces
design as well as services in 3D visualization.
Founded in 2006, Design Arc Interiors is an interior dcor and interior
designing company offering exclusive services in living and work
place interior design in Bangalore and Dubai. They work in
partnership with Cambridge Electro Mechanical located in Abu
Dhabi, UAE, who work in close coordination with DAI with all
interior projects in Dubai.

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SHREEJI ASIA

SAVIO & RUPA

Savio & Rupa Interior concepts offer a comprehensive range of
interior design and furnishing solutions for residential and commercial
spaces. Their innovative design ideas seek to take care of short term
requirement as well as protect long term investments. Theyre
committed to deliver superior and classy interiors with a judicious
blend of the aesthetics and functional aspects.
THE DESIGN FIRM
The Design Firm is an innovative Bangalore based practice
established in October 2005, specializes in high quality designs for all
range of projects. Its distinctive Architectural and interior designs
serves range from design ideas and feasibility studies through to
development of concepts.
TDF combines all aspects of a project from producing concepts to
construction drawings which embraces functionality to aesthetics,
maximizing space, light and form being in harmony with propertys
natural surroundings and professionally manages each project through
to completion.
KUVIO STUDIO
KUVIO STUDIO is an Interior Design firm established specially with
a passion to bring to life your space of dreams. Founder Richa Singh
and her team at KUVIO STUDIO come with the collective design

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experience of 15 years ranging from residential, commercial and retail

spaces at Bangalore, New Delhi, Mumbai and Lucknow. We approach
design for each project with a personal touch and sense of ingenuity.
Organizational structure
The organization structure of SHREEJI Asia is hierarchy type
where

all the managers of various department that is Business

Development Department, Project Management department, Human

Resource department Purchase Department and account department
needs to report directly to the Managing Director of the company.

Fig 2.1 Organization Structure of SHREEJI ASIA

3.1 FUNCTIONAL DEPARTMENTS

Functional departments are those departments in which different
functions of an organization takes place i.e. Grouping

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of individuals on the basis of the function each performs in

the organization, such as accounting, marketing, manufacturing or
grouping of activities or processes on the basis of their need in
accomplishing one or more tasks. There are various functional
departments are there in every organization. They are Marketing,
Sales, HR department, IT, Operations, R & D, etc
3.2 FUNCTIONAL DEPARTMENTS OF SHREEJI ASIA
The various departments of SHREEJI ASIA are
1) Projects
2) Finance & Accounting
3) Human Resource
4) Business Development
The company has four main departments i.e. Business Development,
Purchase, Accounts and Human Resource. All the departments work
in accordance with each other in acquiring & successfully completing
the project. The Business Development Department is responsible for
bringing the projects to the company. After the company gets a
project, the Purchase Department start purchasing the material
required on the site and Accounts Department maintains the
documents in Tally ERP 9and MS Excel.
1. Projects
Project Management is the art of managing all the aspects of a project
from inception to closure using a scientific and structured
methodology. The term project may be used to define any endeavour
that is temporary in nature and with a beginning or an end. The project
must create something unique whether it is a product, service or result
and must be progressively elaborated. As the definition implies, not
every task can be considered a project. It would be worthwhile to keep

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this definition in mind when categorizing projects and studying their

role in the success of the organization. With the above definition of
the project, one gets a clear idea on what a project is.
Program Management is defined as a department that centralizes the
management of projects. What this means is that the PMO or the
Project Management Office is a repository of all the projects that are
being executed in an organization. Program Management serves the
CIO (Chief Information Officer) by providing him or her with regular
status updates regarding the progress of all the projects in the
company.
The PMOs role is to ensure that the projects are financially viable and
to raise an alert whenever there is a possibility or occurrence of a cost
overrun. The PMO also keeps tab on the billing and other details that
are concerned with the project. Thus, the PMOs function is to oversee
the projects coming under its domain and act as a kind of monitoring
agency for them. In the current scenario, there is a need for visionary
leadership by the CIOs in addition to the technical leadership.
Technical leadership is the ability to spot trends in the technical space
and leverage them for the success of the project. This involves
choosing the right technology and being able to stay ahead of the
curve with respect to new technologies. On the other hand, program
visionary leadership is needed to control costs and effectively manage
productivity increases and tighter integration of processes. This is
relevant in the context of the ongoing economic crisis where the
accent is on cutting costs and improving the bottom line.
The Project Managers role is to ensure that the overall objectives of
the project are achieved with the participation of each individual
member. The project manager is like the Prima Donna and his or her
acumen depends on how well he or she can leverage the strengths of
the individual members while minimizing the impact of their

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weaknesses. Program managers take the same view but at a much

higher level. Their job is on the overall bottom line for the division or
the company and they drive the individual project managers.
PROJET MANAGER

Fig 3.1 Project Management Department in Shreeji Asia

Finance & Accounting
Financial Management means planning, organizing, directing and
controlling the financial activities such as procurement and utilization
of funds of the enterprise. It means applying general management
principles to financial resources of the enterprise.
Cost Analysis is the site wise description of all the expenses incurred
by the company in executing projects. We have used MS Excel to
prepare the Cost Analysis. The expenses and their description are
arranged under various types of categories and sub categories. This
helps the management to determine the areas where expenses are
more than anticipated and steps can be taken to reduce the expenses in
the ongoing projects. The Excel sheet is kept as a record of all the
expenses for a particular site.

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The accounts department maintains five main kinds of documents:

Purchase Order
Purchase Bills
Cash Vouchers
Bank Vouchers
Sub Contractors Bills
Purchase Order:
Purchase Order is a document which is send to the vendors to supply a
particular product(s)

PURCHASE DEPARTMENT

Fig 3.2 Purchase Department in Shreeji Asia

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SHREEJI ASIA

Purchase Bill:
Purchase Bill is a document which is generated by the vendor and sent
to the company. The Purchase Bill is either delivered on the site along
with the material or is sent to Office.
Cash Voucher:
Cash Voucher is a document generated in the company when cash
payment is made against a bill. Any type of Cash payment from the
company is recorded in cash voucher. Cash payments are given for
small purchases. Generally Miscellaneous expenses like Labor Food
Expense, Water expense, Fuel Expense and all the purchases done
without Purchase Order are paid through Cash.
Bank Voucher:
Bank Vouchers are generated by the Company whenever expenses are
done by any of the following modes:
Cheque
Demand Draft
RTGS Real Time Gross Settlement
NEFT National Electronic Fund Transfer
These modes are used to pay large sums of money. Generally,
payment against Purchase Bills is done through these modes. Unlike
Cash Book, the details of Bank Vouchers are entered in Tally.
2. Human Resource
We often hear the term Human Resource Management, Employee
Relations and Personnel Management used in the popular press as
well as by Industry experts. Whenever we hear these terms, we
conjure images of efficient managers busily going about their work in

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glitzy offices. In this article, we look at the question what is HRM?

by giving a broad overview of the topic and introducing the readers to
the practice of HRM in contemporary organizations. Though as with
all popular perceptions, the above imagery has some validity, the fact
remains that there is much more to the field of HRM and despite
popular depictions of the same, the art and science of HRM is
indeed complex. We have chosen the term art and science as HRM
is both the art of managing people by recourse to creative and
innovative approaches; it is a science as well because of the precision
and rigorous application of theory that is required.
HR FUNCTION OF SHREEJI ASIA PVT LTD
RECRUITMENT AND SELECTION POLICY
Introduction
Recruitment and Selection aim to search and hire suitable candidate to
fill vacancies in Shreeji House with the view to satisfying human
resources needs. The search may be internal and/or external.
Any position within Shreeji House that becomes vacant will be filled,
on completion of a requisition form by the immediate supervisor. The
success and adaptability of a Company depends upon the recruitment
of employees who are flexible, adaptable and committed to the
success of the Shree Asia.
Objectives
This section aims to promote and maintain high standards of
professional recruitment practice by encouraging recruiters to adhere
to best practices. Its purposes are to:
a) Ensure that recruitment is considered an essential part of the
human resource

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b) Strategy and consequently an integral part of the overall

business strategy;
c) Ensure and explain best practice for all types of recruitment;
d) Maintain professional standards whether recruits are easy to
find;
e) Ensure that equality of opportunity is considered an integral
part of good recruitment practices and procedure;
Appointment
All staff will be appointed by the Shreeji Asia Pvt. Ltd. through an
interview process. The interview mainly consists of two rounds i.e.,
Aptitude test and HR round and final round.
Letters of Appointment: The formal letter of appointment will bear
the signature of the Managing Director as delegated. The letter shall
require the signature of the appointee before the appointment is
considered effective.
Job Description: On appointment, an employee shall be given a job
description. This shall specify the scope and terms of reference for
their position. Each member of staff is expected to devote their time
and attention to their work and not engage in activities that may
conflict with Shreeji Asia Pvt. Ltd.s interests or negatively affect their
performance. Job Descriptions shall be reviewed yearly.
Probation: Any appointment made on Shreeji Asia Pvt. Ltd. shall be
subject to a probation period as specified in the letter of appointment.
Six months towards the end of the probation period, employees
immediate supervisor shall make an appraisal report recommending a
confirmation or termination of the employees services. Where
necessary, the probation period may be extended as considered
necessary by the HR Team. An employee who is on probation may

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have his appointment terminated at any time without notice. In the

event of such termination, the employee is paid for the period worked
up to the time of termination
Duration of employment: Unless otherwise stated, employment for
all staff shall be on permanent basis subject to satisfactory completion
of the probation period and availability of funds.
Induction
All new staff shall undergo induction training to assist them in the
process of becoming integrated to the institution within the shortest
time possible. The respective immediate supervisor in collaboration
with the HR Officer shall conduct induction training.
TRANSFER & SHIFTING POLICY
For the benefit of the organization, staff may be required to be
transferred OR shifted from one unit to other.
Transfer & shifting both will mean relocation of staff from one unit
to another.
The authority of the organization will decide the transfer or
shifting as per the necessity of the organization.
The staff should be apprised by the immediate supervisor
regarding the transfer or shifting.
In case of shifting the staff will get no additional benefit.
PERFORMANCE MANAGEMENT
Introduction
Decisions concerning career development, promotion, succession
planning and compensation depend on information provided through
effective performance management. The organization will therefore

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ensure that all new employees understand the requirements of their

jobs as well as the expected results. The actual assessment of how
well they have done will be undertaken at the end of each year
through a comprehensive appraisal of their performance in relation to
these expectations.
Objectives
Staff appraisal is often viewed as a punitive measure where most
junior staff looks it as a time when their seniors would get even with
them for whatever reason. Shreeji Asia Pvt. Ltd. will therefore seek
first to promote a healthy understanding of this process in terms of
being an avenue to promote dialogue between staff and management
as well as a system through which specific needs of staff are identified
and brought into the limelight
The Performance Management Process:
Performance Planning
Monitoring
Performance Summary
Recognition
PERFORMANCE PLANNING:
A Performance Plan is a written document between an employee (or
team) and his or her manager. The performance plan describes what
has to be done during the performance cycle, how well it has to be
done, and how the accomplishment will be measured. This part of the
plan is based primarily on the goals of SHREEJI ASIA PVT. LTD. and
the employee's job description.
Requirements for Temporary Positions: A performance plan should
be established in all cases where the duration of the temporary

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employee is uncertain. A new performance plan must be established

when an employee is scheduled to work for 90 days or longer.
MONITORING
Monitoring is the process of making accurate and objective
performance observations based on the outcomes and expectations
contained in an employee's performance plan. In addition, the
manager will provide timely feedback throughout the performance
cycle to encourage employees to maximize their performance.
Performance observations will be provided from multiple sources.
PERFORMANCE SUMMARY
The performance summary is a consolidation, discussion, and
acknowledgement of employee accomplishments and effectiveness
throughout the performance cycle.
a) Provides an assessment of actual achievements based
on the outcomes and expectations contained in the
performance plan.
b) Includes a synopsis of formal feedback received during
the performance cycle.
c) Contains highlights of developmental
undertaken during the period.

activities

RECOGNITION
A means of acknowledging employees for sustained outstanding
performance/service and providing incentives to continue provide
outstanding performance/service. Recognition should be linked to
performance outcomes. For example, employees should be
recognized/rewarded for being results-oriented and customer-focused.
Other contributing factors could be increased morale, contribution to
team cohesiveness, contribution to the success of the performance

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management process, etc. Recognition does not necessarily have to be

linked to a bonus system, but can be for e.g.; time off, chance to
attend conferences of choice etc.
TRAINING AND DEVELOPMENT POLICY
Introduction
Shreeji Asia Pvt. Ltd. strongly believes that a well-trained and
efficient workforce is crucial for the development of any institution.
As such, we will always strive to attract and retain employees of the
highest caliber.
To achieve this, Shreeji House will recruit all levels of staff strictly on
merit. After their engagement, the trust will further provide them with
opportunities to advance skills and professional expertise as well as
give them adequate exposure.
Objectives
The objectives of the Training and Development Policy are to:
a) Ensure that training and development are offered to employees
of Shreeji Asia Pvt. Ltd.
b) ensure that need-based training and development interventions
are equitably distributed to all categories of staff and at all
levels of Shreeji Asia Pvt. Ltd., with particular emphasis on the
lower ranks;
c) Ensuring equal opportunity in training and development within
all Department of Shreeji Asia Pvt. Ltd..
d) Develop and maintain a pool of suitably qualified staff
(technical, administrative and professional) at Shreeji Asia Pvt.
Ltd.;

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e) Create an environment that is conducive to self-development

and career advancement of staff members;
f) Process and Criteria
Shreeji Asia Pvt. Ltd. will handle staff training as an integral part of
its organizational development. It will endeavor to train its staff
continuously and impart them with new skills, through some of the
following ways:
Training or development programme shall only be offered after a
through needs assessment by the Human Resources Officer in
consultation with the Department Managers. Shreeji Asia Pvt. Ltd.
places a high premium on human resources training and development.
Any training identified by individuals shall also be considered. Where
these activities are deemed important by Shreeji Asia Pvt. Ltd., an
equitable selection process of who shall attend the course shall be
made and Shreeji Asia Pvt. Ltd. shall fully fund the activity subject to
the following conditions:
The employee must submit a formal application to his
supervisor;
The application shall be forwarded by the supervisor, with
his/her recommendations and comments to the Head of
Department;
Approval will thereafter have to be obtained from the Human
Resources Officer.
3. BUSINESS DEVELOPMENT
Business development is being practiced by the almost all the major
companies. It is now being adopted by the small business too as they
also look forward to grow. Business expansion needs a set of skills

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and different approaches. There no single business strategy that could

fit every business. Therefore, every firm or organization needs to
work hard, identify its requirements and then work on them. There are
a lot of functions which a business development department or a
business development teams needs perform. Some common functions
of business expansion department are as follows:
THINKING OF NEW IDEAS
The very first function of a business growth team or department is to
think of new ways of doing business. They should either come with a
new idea or they should bring improvement in the existing processes.
This function of business development department brings continuous
improvement in the business process and techniques.
GATHER CAPITAL
The main responsibility of gathering funds is on the finance
department of any organization but the business growth department
needs to play an important role in this regard. They need to gather the
resources from which they can take up capital to enhance the business.
MANAGING RELATIONSHIP
Managing relationships is one of the most important duties of the
business development department. They need to manage the
relationships with the existing clients whereas build relations with the
new clients. In today's business world it is difficult to find a reliable
and loyal client. And it is even more difficult to retain them.
Therefore, a business development manager or the business
development team manages the relations with the clients. Tries to
identify their problems and report to the company so that the problems
could be solved. In other words they are the one to make sure that the
client is getting the maximum satisfaction or not.
BUILDING JOINT VENTURES

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At times certain situations occur when a single business cannot handle

a project and it needs the help of another business to run the project
successfully. In such situations business enter into joint venture
contracts and start joint venture projects. There are a lot of examples
in the business world where two major organizations start a single
project. The business growth department of the organization is liable
to find the most reliable business partners and maintain good longterm relations with them too.
FULFILLING REQUIREMENTS
Fulfilling the commitments is the key to business development. One
of the responsibilities of the business development department is that
they must fulfill the commitments made by the clients. They must
communicate with the other departments of the organization
effectively and represent their organization in front of the business
clients. They must be true and honest with the clients and they must
make it sure that the commitments are being fulfilled.
BUSINESS DEVELOPMENT

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Fig 3.3 Business Development Department in Shreeji Asia

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The following ratios have been chosen: 1.

Current ratio

2.

Quick ratio

Debt/equity ratio

4.

Net profit ratio

5.

Operating cost ratio

6.

Return on investment

7.

Return on working capital

8.

Stock turnover ratio

9.

Debtors turnover ratio

10.

Fixed assets turnover ratio

11.

Working capital turnover ratio

12.

Creditors turnover ratio

13.

Capital turnover ratio

14.

Operating cost ratio

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1. CURRENT RATIO
Meaning:This ratio compares the current assets with the current liabilities. It is
also known as working capital ratio or solvency ratio. It is
expressed in the form of pure ratio.
Formula:Current assets
Current ratio = ------------------------Current liabilities

CURRENT

CURRENT

CURRENT

ASSETS

LIABILITIES

RATIO

(In Rs.)

(In Rs.)

2010-2011

1,56,73,262.86

1,34,20,567.03

1.17:1

2011-2012

3,76,05,804.27

1,75,82,387.41

2.14:1

2012-2013

7,29,69,335.90

3,46,66,200.82

2.10:1

YEAR

Table-4.1 CURRENT RATIO

Analysis:-

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The analysis shows that the current ratio of the company in the year
2010-11 is 1.17, 2011-12 is 2.14 and 2012-13 is 2.10. This also shows
that company is maintaining good liquidity position. Only 2010-11,
the ratio of the company decreases compares to 2011-12 and 2012-13.

CURRENT RATIO

1.17

2.1

2010-11
2011-12
2012-13

2.14

Interpretation:The current ratio of the company having lesser than the standard ratio
i.e. 2:1 only in 2010-11 and later year company is maintaining
standard ratio in 2011-12 & 2012-13. So company is maintaining their
good liquidity position i.e. standard ratio 2:1

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2. QUICK RATIO
Meaning:This is the real index of the financial liquidity of the concern. It
calculates the companys liquid assets in relation to its liabilities. It is
also called as acid test ratio or liquid ratio.
Formula:Quick assets
Quick ratio = -----------------------------------Quick liabilities

Table-4.2QUICK RATIO
YEAR

QUICK
ASSETS

QUICK QUICK
LIABILITIES
RATIO

2010-2011

5576282.86

13420567.03

100

0.42:1

SHREEJI ASIA

2011-2012

11727598.27

17582387.41

0.67:1

2012-2013

21532685.9

34666200.82

0.62:1

Analysis:A quick liability consists of current liabilities for the year 2010-11,
2011-12, and 2012-13. Whereas quick asset consists of cash and bank
balance, advances and other assets; expect for the prepayments.

QUICK RATIO

0.42

0.62

2010-11
2011-12
2012-13

0.67

Interpretation:A quick ratio of 1:1 is considered to represent a satisfactory current

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financial position. In the year 2010-11, the liquidity ratio is low as

compared to 2011-12 and 2012-13. The company is not maintaining
their quick ratio in a better way. Company need to utilize its current
assets in much better way to meet its current liabilities.

DEBT EQUITY RATIO

Meaning:This ratiomeasures the relationship between long term debt and
capital. In other words, this ratio measures the relative claims of long
term creditors on the other hand and owners on the other hand, on the
assets of the company.
Formula:Long term debts
Debt Equity ratio = ---------------------------owners capital

Table-4.3 DEBT EQUITY RATIO

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YEAR

LONG TERM
DEBTS

OWNERS
CAPITAL

DEBT EQUITY
RATIO

2010-2011

4763025.25

11147121.58

042:1

2011-2012

17731901.40

9906519.56

1.79:1

2012-2013

35732782.81

15228671.08

2.35:1

ANALYSIS:-

Here the debt equity ratio consists of long term debt and owners
capital. In 2010-11 company is having 0.43:1, which is lesser than the
standard ratio which is 1:1 and in 2011-12 and 2012-13 company is
having greater debt equity ratio which is also not good for the
company because high debt equity ratio indicates that the claim of the
creditors are greater than those of owners

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INTERPRETATION:Here the debt equity ratio consists of long term debt and owners
capital. A low debt equity ratio implies a greater claim of owners on
the assets of the company than the creditors and high debt equity ratio
indicates that the claims of the creditors are greater than those of
owners. Company should decrease their debt or pay their debt because
its not good for the company.
3. GROSS PROFIT RATIO:Gross profit ratio measures the relationship of gross profit to net sales
and is usually represented as a percentage.
Formula:-

Gross profit
Gross profit ratio = ---------------------------- 100
Net sales
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YEAR

GROSS PROFIT

SALES

GROSS
PROFIT
RATIO (In %)

2010-2011

13782720.06

8,91,13,153.32

15.44

2011-2012

17191397.69

11,11,74,494.55

15.38

2012-2013

15759052.98

7,28,33,712

20.84

ANALYSIS:Here the company is having 15.44% gross profit in 2010-11, in 201112 company is having 15.38% gross profit and 2012-13 company is
having 20.84% gross profit which is better than 2010-11 & 2011-12.

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Gross profit ratio

2010-11

40%

2011-12

30%

2012-13

30%

INTERPRETATION:Gross profit ratio indicates the average margin on the goods sold. It
shows whether selling price is adequate or not. A low gross profit may
indicate a higher cost of production. A high gross profit ratio indicates
a lower cost and is a sign of good management. Here company is not
maintaining better profit margin.

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4. NET PROFIT RATIO

Meaning:This is the ratio of net profit to net sales. In calculating the net profit,
all non-operating expenses and losses are also deducted and all nonoperating income are added.
Formula:Net profit
Net profit ratio = -------------------------- 100
Net sales

YEAR

NET PROFIT

NET SALES

NET PROFIT
RATIO
(In %)

2010-2011

4931242.90

89113153.32

5.53

2011-2012

3694061.81

72833712

4.60

2012-2013

5114275.88

11174494.55

5.07

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ANALYSIS:Here the company is having in 2010-11 5.53% net profit, in 2011-12 4.60% which is
getting decreases in 2011-12 and 2012-13 company is having 5.07% net profit which is
getting increases in 2012-13. This shows the company is not maintaining better net profit.

NET PROFIT RATIO

33%

36%

2010-11
2011-12
2012-13

30%

INTERPRETATION:The net profit ratio is over all measure of the firms ability to turn each rupee of sales into
profit. It indicates the efficiency with which a business is managed. A firm with high net
profit is an advantageous position to survive in the face of rising cost of production and
falling selling prices. Thus company should improve their net profit ratio.

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5. RETURN ON INVESTMENT
Meaning:This is the most important test of profitability of business. It measures
the overall profitability. It is ascertained by comparing profit earned
and capital employed to earn it.
Formula:Profit before interest & taxes
Return on investment = -------------------------------------------- 100
Total capital employed

YEAR

PROFIT BEFORE
INTEREST
&
TAXES
(PBIT)

TOTAL
CAPITAL
EMPLOYED

RETURN
INVESTMENT
(In %)

2010-2011

4931242.90

11147121.58

44.24

2011-2012

3694061.81

9906519.56

51.63

2012-2013

4931242.90

15228671.08

24.26

ANALYSIS:Here the company return on investment in 2010-11 is 44.24%, 201112 is 51.63% which is increases by 44.24% to 51.63% but the ROI in

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2012-13 is 24.26% which is lower than 2010-11 and 2011-12, which

is not good for the company.

RETURN ON INVESTMENT
20%
37%

2010-11
2011-12
2012-13

43%

INTERPRETATION:ROI is the only ratio which measures satisfactorily the overall

performance of the business from the point of view of profitability.
This ratio indicates how well the management has utilised the fund
supplied by owners and creditors. The higher ROI, the more efficient
the management is considered to be in using the fund available.
Company should maintain their ROI because it decreases in 2012-13,
which is not good for the company.

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6. RETURN ON WORKING CAPITAL

Meaning:Return on working capital is a method of increasing enterprise value
by maximizing efficiency of working capital. It measures return
within the business.
Formula:Return on working capital =

Net profit
------------------------------working capital

YEAR

NET PROFIT

WORKING
CAPITAL

RETURN ON
WORKING
CAPITAL
(In %)

2010-2011

4931242.90

2252695.83

218.90

2011-2012

3694061.81

20023416.86

25.54

2012-2013

5114275.88

38303135.08

9.64

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ANALYSIS:Here the company is having 218.905 in 2011, 2012 is 25.54 which is

much lesser than 2010 and 2013 is 9.24 which also much lesser than
2011 & 2012. This shows the company is not maintaining return on
working capital.

RETURN ON WORKING CAPITAL

10%

4%
2010-11
2011-12
2012-13
86%

INTERPRETATION:Return on capital (ROC), otherwise called invested capital (ROIC), is

one the most important ratios to measure profitability of a company. It
measures how much money a business or investment is able to
generate on the capital employed. Despite its importance, this ratio is
seldom reported and often needs to be calculated. Here is how to

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determine this ratio from the balance sheet and income statement.
Company should maintain their return on working capital.

7. STOCK TURNOVER RATIO

Meaning:This ratio is the relationship between the cost of goods sold during a
given period and the average amount of stock carried during the
period.
Formula:Cost of goods sold
Stock turnover ratio = -----------------------------Average stock

Cost of goods sold = Sales Gross profit

Opening Stock + Closing stock
Average stock= --------------------------------------------2

YEAR

COST
SOLD

OF

GOOD

113

AVERAGE STOCK

STOCK
TURNOVER RATIO
(In times)

SHREEJI ASIA

2010-2011

75330433.26

11940990

6.30

2011-2012

55642314.31

17987593

3.10

2012-2013

95415441.57

38657428

2.47

ANALYSIS:Here the stock turnover ratio in 2011 6.30 times, in 2012 company is
having 3.10 times and 2013 it is 2.47 times. There is continuous
decreasing in stock turnover ratio, which is not good for the company.

STOCK TURNOVER RATIO

2.47
6.3
3.1

2010-11
2011-12
2012-13

INTERPRETATION:Stock turnover ratio indicates the efficiency of a firms inventory

management. This ratio gives the rate at which stock are converted in

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to cash. A low inventory turnover ratio is an indicator of dull business,

accumulation of inventory, over investment in inventory or
unreasonable goods etc. a high stock turnover ratio is considered
better as it indicates more sales. So company should maintain their
stock turnover ratio which keeps on decreasing. But too high and too
low ratio is also not good for the company.
8. DEBTORS TURNOVER RATIO
Meaning:This ratio indicates the relationship between net credit sales and trade
debtors. It shows that the rate at which cash is generated by the
turnover of debtors.
Formula:Sales
Debtors Turnover Ratio = ----------------------------------Debtors

YEAR

SALES

DEBTORS

DEBTORS
RURNOVER RATIO
(In times)

2010-2011

89113153.32

71295794.69

1.25

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2011-2012

111174494.55

94254642.73

1.18

2012-2013

72833712

27065729.93

2.69

ANALYSIS:Here debtors turnover ratio is 1.25, 1.18 and 2.69 as on 2011, 2012
and 2013 respectively. It indicates that company is not maintaining
their ratio in a proper way. Only 2012-13 company is getting their
debtors quickly.
3

2.69

2.5
2
DEBTORS TURNOVER RATIO
1.5

1.25

1.18

1
0.5
0
2010-11

2011-12

2012-13

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INTERPRETATION:This ratio lies in the fact that debtors constitute one of the important
items of current assets and this ratio indicates the how many days
average sales are tied up in the amount of debtors. A high debtors
turnover ratio indicates that debt are being collected more quickly.
Change in this ratio shows the change in the companys credit policy
or change in ability to collect from its debtors. The company should
maintain their ratio.

9. FIXED ASSETS TURNOVER RATIO

Meaning:This ratio indicates the efficiency with which the firm is utilising its
investments in fixed assets such as plant and machinery, land &
building etc.
Formula:Sales
Fixed assets turnover ratio = -------------------------Net fixed assets

YEAR

SALES

NET
ASSETS

2010-2011

89113153.32

8726208.10

117

FIXED

FIXED
ASSETS
TURNOVER RATIO
(In times)
10.21

SHREEJI ASIA

2011-2012

111174494.55

7615004.10

14.60

2012-2013

72833712

8964257

8.12

ANALYSIS:The analysis shows that a fixed asset turnover ratio of the company in
the year 2011 is 10.21 and 2012 is 14.60. Table shows that the ratio is
decreases in the year 2012-12 by 8.12 when it compares to last year
by 14.60.

16

14.6

14
12

10.21

10

8.12

8
6
4
2
0
2010-11

2011-12

2012-13

118

FIXED ASSETS TURNOVER

RATIO

SHREEJI ASIA

INTERPRETATION:Fixed assets turnover ratio provides very useful information for both
investors and management about whether or not company is becoming
more efficient in the use of its fixed assets by comparing its value
with its historical records or industry average. A high ratio indicates
efficient utilisation of fixed assets in generating sales and a low ratio
may signify that the firm has an excessive investment in fixed assets.
There is an appreciable increase in fixed assets in 2012 compare to
another year.
WORKING CAPITAL TURNOVER RATIO
Meaning:This ratio indicates the efficiency or inefficiency in the utilisation of
working capital in making sales.
Formula:Sales
Working capital turnover ratio = --------------------------Net working capital

Net working capital = current assets current liabilities

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YEAR

SALES

NET
WORKING
CAPITAL

WORKING
CAPITAL
TURNOVER RATIO
(In times)

2010-2011

89113153.32

2252695.83

39.56

2011-2012

111174494.55

20023416.86

5.55

2012-2013

72833712

38303135.08

1.90

ANALYSIS:The analysis shows that working capital turnover ratio in the year
2010 is 39.56, 2012 is 5.55 and 2013 is 1.90. Table shows that the
ratio decreases in the year 2011 and 2012 when it compare to last year
2010.

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45
40

39.56

35
30
WORKING CAPITAL
TURNOVER RATIO

25
20
15
10
5.55
5

1.9

0
2010-11

2011-12

2012-13

INTERPRETATION:A high working capital turnover ratio shows the efficient utilisation of
working capital in generating sales. A low ratio, on the other hand,
May indicates excess of net working capital. This ratio shows that the
working capital is efficiently utilised or not. Here the ratio keeps on
decreasing compare to year 2010.

10.CREDITORS TURNOVER RATIO

Meaning:-

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This ratio also known as payable turnover ratio measures the

relationship between credit purchases and average account payable.
Formula:Purchases
Creditors turnover ratio = -------------------------------------creditors

YEAR

PURCHASES

CREDITORS

CREDITORS
TURNOVER RATIO
(In times)

2010-2011

53439070.55

33112849.93

1.61

2011-2012

80201327.37

69015084.18

1.16

2012-2013

64264017.62

80058231.25

0.80

ANALYSIS:This analysis shows that creditors turnover ratio of the company in the
year 2011 is 1.61, 2012 is 1.16 and 2013 is 0.80. The table shows that
the creditors turnover ratio which keeps on decreasing.

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1.8
1.6

1.61

1.4
1.16

1.2
1

0.8

0.8

CREDITORS TURNOVER
RATIO

0.6
0.4
0.2
0
2010-11

2011-12

2012-13

INTERPREATATION:Here the data shows that creditors turnover ratio in the year 2010-11,
2011-12 and 2012-13 is 1.61, 1.16 and 0.80, which keeps on
decreasing. So it is good sign for the company because lower the
creditors higher profit and lower debt for the company.

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11.CAPITAL TURNOVER RATIO

Meaning:This ratio shows the relationship between cost of sales (or sales) and
the total capital employed.
Formula:Sales
Capital turnover ratio = -------------------------------------Total capital employed

YEAR

SALES

TOTAL
CAPITAL
EMPLOYED

CAPITAL
TURNOVER RATIO
(In times)

2010-2011

89113153.32

15910146.83

5.60

2011-2012

111174494.55

27637420.96

4.02

2012-2013

72833712

50961543.88

1.43

ANALYSIS:The table shows that capital turnover ratio of the company in the year
2011 is5.60, 2012 is 4.02 and 2013 is 1.43.b Table also shows that the

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creditors turnover ratio is keeps on decreasing compares to lat two

year

5.6

5
4.02
4
CAPITAL TURNOVER RATIO
3
1.43

2
1
0
2010-11

2011-12

2012-13

INTERPRETATION:This ratio shows the efficiency with which capital employed in a

business is used. A high capital turnover ratio indicates the greater
profit and a low capital turnover ratio is a sign of insufficient sales and
possibility of lower profit. Company should maintain their capital
turnover ratio.

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12.OPERATING COST RATIO

Meaning:Operating cost ratio indicates the relationship of various operating
expenses to net sales.

Formula:Operating expenses
operating cost ratio = -------------------------------------- 100
sales

YEAR

OPERATING
EXPENSES

SALES

OPERATING COST
RATIO
(In %)

2010-2011

8851477.16

89113153.32

9.93

2011-2012

12078121.81

111174494.55

10.86

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2012-2013

12064991.17

72833712

16.57

ANALYSIS:Here the table shows that operating cost ratio of the company in the
year 2011 is 9.93, 2012 is 10.86 and 2013 is 16.57. Table also shows
that operating cost ratio which keeps on increasing compares to last
two year.

18

16.57

16
14
12

9.93

10.86

OPERATING COST
RATIO

10
8
6
4
2
0
2010-11

2011-12

2012-13

INTERPRETATION:-

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This is main important ratio that every company and organisation

calculate because it shows the companys expense and profit. The
lower the ratio, the greater is profitability and the higher the ratio,
lower is the profitability. In this chart, graph is increasing every year
which is not good for the company because an expense of the
company keeps on increasing.

FINDINGS:1:- The current ratio shows the short term financial position and
policy. The standard ratio that is 2:1. The ratio of the company is
lower than the standard ratio i.e. 1.17:1 only in 2010-11 only. After
that company is maintaining their good liquidity position in 2011-12
is 2.14:1 and 2012-13 is 2.10:1.
2:- The quick ratio shows the ability to meet its immediate financial
commitments. Quick ratio 1:1 is considered to represent a satisfactory
current financial position. Company is having their quick ratio in the
year 2010-11 is 0.42:1, 2011-12 is 0.67:1 and 2012-13 is 0.62:1. Here
the company quick ratio is not satisfactory because its less than the
standard ratio i.e. 1:1. This is due to fact that the company does not
have a quick assets sufficient to meet its quick liabilities and quick
liabilities gone up more in proportion to the quick assets. The
company need to work on this.

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3:- The debt equity ratio of the company in the year 2010-11 is .
0.42:1, 2011-12 is 1.79:1 and 2012-13 is 2.35:1 which is keep on
increasing. The debt equity ratio of the company in the year 2010-11
is good because it is lower than the capital. But the year 2011-12
company has debt more than the capital which is double and 2012-13
debt is also more than the capital it is not good sign for the company.
So company should maintain their debt equity ratio.
4:- the net profit of the company is also decline compares to last year.
Because in the year 2010-11 the ratio is 5.53%, 2011-12 is 4.06% and
2012-13 is 5.07% which got decreases because of company huge debt.
So company should maintain their net profit otherwise company will
go in huge debt.
5:- the return on investment of the company is also decline in the year
2012-13 which is 24.26 compares to last year. So company should
maintain this ratio.
6:- The stock turnover ratio is also decreased because in the year
2010-11 the ratio is 6.30, 2011-12 is 3.10 and 2012-13 is 2.47 which
is also not good sign for the company. So company should increase
their
7:- Capital turnover ratio is also decreasing in the year 2011-12 and
2012-13 it is 4.02 & 1.43 when it compares to year 2010-11 the ratio
is 5.6. So it is not good sign for the company because high capital
turnover indicates high profit so company should maintain this ratio.

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8:- The operating cost ratio of the company in the year 2010-11 is
9.93, 2011-12 is 10.86 and 2012-13 is 16.57 which are increasing so
company should maintain this because higher operating ratio lower
profitability and lower the ratio greater profitability.
9:- Working capital turnover ratio of the company in the year 2010-11
is 39.56, 2011-12 is 5.55 and 2012-13 is 1.90. This is decreasing
compare to last year. A high working capital ratio shows the efficient
utilisation of working capital in generating sales.

CONCLUSIONS:1:- The proprietor does have clear mobilization of fund which can take
care of any liability at any period.
2:- The current assets and current liabilities is very favourable in
2011-12 and 2012-13 hence the company does not have any problem
in working capital requirements.
3:- The Companys credit policy is normal seen by the business cycle.
4:- In all the profit generated by the company for the last 3 years and
also transaction of the company is very favourable which will result in
the company is improving financial growth.

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SUGGESTIONS:1:- The Company in order to diversify certainly requires some funding

from financial institutions.
2:- Though the companys current ratio is favourable obtaining further
credit from creditors is possible for short term.
3:- The companys debt equity ratio is not favourable company should
not obtain credit for long term from creditors. The debt equity ratio
should be improved by the company for more funds to the company.

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4:- Companys profitability position is very low so company should

increase their sales to get better profit.
5:- Company should improve their operating cost ratio for getting a
better profit.
6:- Company should utilise their working capital in proper way to
generate sales and profit.
7:- Capital turnover ratio shown downstage thus the company should
improve their capital turnover ratio.
8:- The company should concentrate more on advertising. By giving
advertising the people would be aware of the companys existence
which in turn, would bring popularity, reliability and belief in peoples
mind.

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Shreeji interiors 2010-11

Balance sheet as at 31st march 2011

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134