Ajmera Cement PVT LTD

A research Report on Working Capital
A
RESEARCH REPORT
ON
WORKING CAPITAL
OF
Prepare by
CHAUHAN HIREN
Class
T.Y.B.B.A.
Academic Year
2016-17
Institution
SHRI K.M. & K.K. SAVJANI COLLEGE, VERAVAL
Guided By
Jalpa madem
Submitted To
Saurashtra University
PREPARED BY:- CHAUHAN HIREN V. -1-
Declaration
I the undersigned, Chauhan hiren a student of T.Y.B.B.A.

here by declare that the project work presented in this report is my
own work and has been carried out under the supervision of jalpa
medam of shri k.m. & k.k. savjani B.B.A. college, veraval.
The work was not been submitted to any other University for
any other examination purpose.
Date:-
Place: - Veraval
Signature:
(Chauhan hiren)

Acknowledgement
It is really a pleasure for me to prepare a report at this stage,

it is my sincere they to thank all those who helped me directly or
indirectly during my research process.
After I would like to thank executive to ajmera cement
private limited for granting me permission for my practical
training. I am very thankful to executives for his valuable
guidance, co-operation and sparing his valuable time also.
At last but not least I am very thankful to our college and I
would like to sincere thanks to Ms.jalpa medam for help me to
prepare this report and solving my drought.
Date: -
Place: -veraval
(Chauhan Hiren)

Preface
Practical training is an important part in the management
studies. Only bookies knowledge is not the right way of learning
anything especially for the management student. Thus by practical
training of business management, student comes to know that how
management theories apply in the modern business world.
Industrial training has developed awareness in the students
about industrial environment and practice.
During this academic year 2016 2017 as a part of my
studies, I have undergone 15 days practical training in ajmera
cement private limited to knowledge about financial condition.
It was really a great experience for me to get practical
training in such a reputed unit.

Index
SR. NO PARTICULARS PAGE.NO
1 Introduction
2 History & development

3 Organization Structure
4 Organization chart
5 Size & form of organization

6 Manufacturing process
7 Production process
8 Time keeping system

9 Employees walfare services
10 Contribution of unit
11 Working capital research report
12 Scope of the study
13 methodology
14 Limitation of the study
15 Working capital management theory

16 Management function in working capital
17 Financing working capital
Source of working capital
19 Use of working capital
20 Data interpretation
21 finding
22 Suggestion
2 conclusion

Company Profile
Introduction
Ajmera Cement pvt.ltd. is unique project and none of its kind

found in Gujarat. It manufactures cement. The concept of manufacturing
from lime stone, clay, coal. It was established in 1985. It was started by Mr.
Chootu bhai Ajmera.
Ajmera cement pvt.ltd. produce only cement.
It Situated At:-
Village :- Bhanduri
Taluka :- Maliya hatina,
District: - Junagadh

2) NAME & ADDRESS OF THE COMPANY:-
Name of the unit: Ajmera Cement pvt.ltd

Year of establishment 1985
Form of organization Private Limited
Address: Ajmera Cements Pvt. Ltd.
Villege Bhanduri,
Taluka Maliya Hatina
Dist. Junagadh
Register Office 19, Station Plot, Gondal-360311

Banker State Bank Of India
Auditor Prakash & Association of Mumbai
Promoter Ajmera Group
Head office Ajmera group of companies,
Citimall, Andheri (west),
Link road, Mumbai-400058
Area covered by the company 10 Hectors
Telephone (02870) 201482
No. of employees 64 including staff
Off day Sunday
Other units Yogi Builder
Ajmera Builder
Nilkanth Builder
Ajmera Steel
Present managing body
Owner Mr. Ajmera

Director Mr. Ajmera
Wise president Mr. Shrivastav
Manager Mr. Sangani
Head of Account Mr. Jethva
Head of marketing Mr. Chudasama
Head of H.R. Mr. Manoj
History and development of the company
Mr Chhotalal S Ajmera

Ajmera Cement pvt.ltd. was established in 1985 at Bhanduri
by leading entrepreneurs Shri Chhotubhai Ajmera. The name of group of
managed this unit is Ajmera group of companies. Ajmera Cement pvt.ltd.
started its production on 26th Dec.1985 at Bhanduri which 24 k.m. Away
from Keshod on the way to Veraval, on state high way road no.31 in
Junagadh Dist. of Gujarat.
Ajmera Cement pvt.ltd. established in 1985 with a semi dry

process and vertical shaft kiten, developed by national council for cement
and building material are known as cement research industry, New Delhi.
Ajmera Cement pvt.ltd. Industry first year produce 13052

M.T. cement and last year cement during this time company adopt new
technology for the best quality of its product there are Installed electrical
weigh feeder and cost of technology is about Rs. 12 lacs. In rainy season for
easy grading of raw material company established hotter air generator, cost
of it is Rs. 6 lacs.
PREPARED BY:- CHAUHAN HIREN V. - 10 -

ORGANIZATION STRUCTURE
Organization basically invests analysis of activities to be

performed for achieve organizational objective, grouping them into various
department and sections so that these can be assigned to various individual
and delegating the appropriate authority so that they can carry their work
properly.
In the ACPL there is functional type of organization. It is clear

from above chart that authority mores from bottom to top. Here managing
directors are responsible for all activities of organization. They are assisted
by general manager such as manufacturing quality control, administrative,
structure.

In this form of organization each department reports to a man

specially qualified for a particular function. The specialists attend to one
function in all departments and each workman has to work under for
superiors or foremen. These men are at lower level management and at the
upper level four other superiors are placed generally known as office man.
A manger having functional authority is a specialist in his own

area but he may be either as staff or a line manager. The delegation of
authority forms the top to down ward in according with function to be
performed.
ORGANIZATION CHART
Chairman
MANAGING
DIRECTOR
GOVERNMENT
MARKETING FINANCE & PROJECTS PURCHASE
LISONNING
& SALES ACCOUNTS & LEGAL
GENRAL
MANAGER GENRAL MANAGER
MANAGER
EXECUTIVES CAS/MBAS ADVOCATES
MANAGER
EXICUTIVE
SOLICITORS MANAGER
EXECUTIVES
Size & Form of Organization
According to the government there are three types of the of the

unit as per their size, which are as under.
A) Small scale
B) Medium scale
C) Large Scale
Small Scale Industry:
If the money invested in the organization in near about 1 crore then

the organization is classified under the small scale industry.
Medium Scale Industry:

If the money invested in the organization is about more then 1 but less
then 10 crore then the organization is classified under medium scale
industry.
Large Scale Industry:

If the money invested in the organization is more than 10 crore then
the organization is classified under large scale industry.
Out of this three the Ajmera cement pvt.ltd is large scale

industry because its investment is more than 10 corers.
Form of the organization:-
There are many type of organization. Different company uses different

type of organization as per its requirement. When two or more person,
workers comes together to work a common goal. Authority and
responsibilities are assigned among so that it can be called organization.
The form of business organization could never satisfied all the

demand of growing nation economy and this wild industrial look after by
model industrial and commercial authority. When they failed to satisfy the
maximum needs, the co-operative organization is come into picture.
There are mainly six forms of organization which are as under:
Sole proprietorship
Partnership
Joint stock company
1. Public enterprise
2. Private enterprise
Co-operative society
Non-profit organization
Ajmera cement pvt. ltd is Private Company Ltd. Because

the company is owned by the private ownersh
Manufacturing Process
Ajmera Cement Private Limited is entirely manufacture unit. It

is produce only cement.
The two main type of cement which are as under:
43
Portland
cement
Cement
Cement
53
Portland
Cement
Manufacturing process is heart of any organisation. It is

converting raw material into finish good. Which are ready to use. The whole
manufacturing process is divided into various stages.

Production Process:
1. Introduction stage
Here, all raw materials are collected from different place, this
raw material are kept in the company ground and stored there and as per
requirement they are brought in the plant for the production.
2. First stage
In this stage all raw materials like limestone, clay, and coals are
crushed in the crushing machine and then after they are stored in the raw
material silos thrown the conveyer belt.
3. Second stage
In this stage all the raw material are taken into a raw mill
through the conveyer belt where all the raw material are mixed in a standard
quality then after all these raw material are grinded and formulated into
power. After laboratory checking this power is dispatched to the store silos
the nodules are formulated by mixing the power with water through,. the
miller the nodules are checked in the laboratory.
4. Third stage
In this stage all the nodules are brought into Killen with the
help of pipe and high degree of temperature is given. Then after the nodules
are converted into black clinkers are stored in the hopper. These clinkers are
crushed through the laboratory machine and converted into powder.
5. Forth Stage
In this stage clinkers and nodules are grinded and converted
into the powder in the cement mill. This powder is taken into the cement
silos. Through the screw conveyer. This powder is known as cement.
6. Fifth stage
This cement is taken into the packaging room, where it is
packed by an alternative packing machine.
Now, cement produces by unit is sold as an ordinary Portland

cement with the brand name SHREEJI CEMENT with the ISI 269
conformation. It is available in 50 K.G. bags.

TIME KEEPING SYSTEM
The time keeping is introduced to check the entry and exit of

employees in the organisation and depending on the wages, salaries, bonus
etc. of each employee are calculated.
The company run in three shifts
Shift Time
A 6:00 a.m. to 2:00 p.m.

B 2:00 p.m. to 10:00 p.m.
C 10:00 p.m. to 6:00 p.m.

The company also have general shift, it begins from 8 A.M .to 6
P.M. with recess from 12:30 P.M to 2 P.M. to the worker.
EMPLOYEES WALFARE SERVICES
The profitability and productivity of any organization depend

upon the industrial relation between administrative and employees of the
unit.
Employees benefits and services are concerned with the

maintains of good relationship between the worker and management. various
types of facilities for its employees as under.
1. Medical Faclities
When any accidents take place at that time company gives first
aid treatment to the workers and the company for employees benefits also
takes insurance policy.
2. Housing Facilities
Ajmera cement Pvt. ltd. provides quarter for operating staff in
Companys colony and also provide hosing facility.
3.Leave facility: -
In ajmera cement pvt. Ltd. according to company act, 30 days
leave are taken during the year & 1 leave for each during 1 week.
4.loan facility: -
This unit also gives loan for purchasing cycle and scooter
rs.1000 to rs.10000 respectively. This loan facility is available for only
operative staff.
5.safety equipments facility: -

Some safety equipment provides to the workers by this unit like
hand glows, helmets and also safety shoes.

Contribution of unit
Contribution of the unit to the industry is significant because this

company is producing the main raw-material is construction, place, pivotal
role in the development of the company.
Ajmera cement Pvt. Ltd. Has contributed a lot to the total strength of
the industry as well as of the country. Ajmera cement Pvt. Ltd. is existing
profit making of ajmera group going for expansion, diversification and
modernization. Promoters are having long experience in the same line of
business. The unit is up grading and expanding its manufacturing
capabilities with the exploration of opportunities.

WORKING CAPITAL RESARCH REPORT
Objective of Study
The concept of working capital management is as older as the
human understand to do business. One simple day to day life example
makes it clear. One housewife bought a new cooker, raw rice and adds water
to the cooker. She had put that on the stove without ignition ting the stove.
After half an hour she came back and check weather the rice has cooked or
not. What do you think about the rice?
A very common answer NO. How can rice be cooked without

ignition ting the stove on which it is put to be prepared? The simple example
tells a lot. How can as organization work without having working capital
though they had spent on the fixed capital? This gives importance of the
finance manager needs to take the decision in his routine work life
pertaining to manage working capital.
The objective of the study is to focus on the very much importance

function of the finance department. Under the head of Working Capital
Management the decision related to receivable management, cash
management, debtor management and inventory management are taken for
the effective production and finance management. The main objective of the
study of Working Capital Management is bifurcated into sub objective like
Receivable Management
Debtor Management
Cash Management
Inventory Management
The various ratios given at the end of the report and their analysis
helps the reader in understanding the importance of the working capital and
effect of the change in it.
SCOPE OF THE STUDY

As it is mentioned earlier that the management of the working
capital requires a great sense of a understanding because the excess working
capital leads to less profitability and ineffective use of the capital, while the
inadequate working capital drags the company under the danger of liquidity.
Thus in other word, the Working Capital Management means to

optimize between the profitability and liquidity. Many company works with
excess working capital. Same is doing in ajmera cement pvt. Ltd.

This shows that the company has aggressive approach towards the
management of working capital, which further creates the scope for the
study.
STEPS TAKEN FOR THE STUDY:-

During the early in the company, the discussion with the finance
manager and other staff members in the finance department was held to
know about the financial position of the company, past history and coming
future of the finance department and company as a whole.
The next step was the collection of the data related to the working
capital. Under this steps the data regarding the current liabilities and current
assets, status in various years, source of finance etc were collected.

After the collection of the data, the various ratios were found and
analyzed in depth.
Then afterward, one more formal meeting was held with the
finance manager to discuss about the financial position of the company
based on the ratio and the reason for the downward arrows in some of the
areas. Based on the study some suggestion were made and discussed about
the implementation policy for them.
METHODOLOGY
Data Collection :
The various data have been collected from the Accounting and
Finance Dept. of the Organization. Another information and data of last 5
years have also been collected from the Dept and some required data were
collected from the annual report of organization.
Data Description :

This report contains data description based on the theoretical

concept and for the description method, simple description methods have
used which contains table and graphs.
Research Tools :
The working capital managements for last 5 years i.e. from FY

2009 2010 to FY 2013 2014 are used for calculating the ratio and hence
interpreting the financial position of the organization during that period of
time.
LIMITATION OF THE STUDY

As we all know that the nothing is limitation free. Every study has
some limitation. The main limitations of this study is classified in three
category
1. Limitation from the researcher side
Time Limitation: There are many scope of improvement in the

existing Working Capital Management system like duplication of data at
both finance and management information system department, format of the
data which differs from department to department. But the time has limited
the study.
Knowledge Limitation: The study conductor is not aware about

the practical approach and organizational politics and practices.
Analysis Limitation: Some data presented in one way and it is

analyzed in the other way and come to certain other conclusion or
interpreted in wrong manner might lead to wrong concept. The emphases are
put to overcome these limitations.
2. Limitation of the respondent

Time Limitation : The respondent (here the staff of finance &
account department) are busy in their tight schedule of the workload.
Sometime they are not free to answer the questions.
3. Limitation of Environment
Lack of understanding between the communicator

Working Capital Management Theory
CONCEPTS OF WORKING CAPITAL:-

There are two concepts of working capital
Gross working capital

Net working capital
Gross working capital: -

Simply called as working capital, refers to the firms investment in
current assets. Current assets are the assets which can be converted into cash
within an accounting year (or operating cycle) and include cash, short-term
securities, debtors, bills receivables and stock (inventory).
Net Working capital : -

It refers to the difference between current assets and current
liability. Current liabilities are those claims of outsiders, which are expected
to mature for payment within an accounting year and include creditors, bills
payable and outstanding expenses. Net working capital can be positive or
negative. A positive net working capital will arise when current assets
exceed current liabilities are in excess of current assets.
MANAGEMENT FUNCTION IN WORKING

CAPITAL
Management of cash
Management of inventories
Management of account receivable
Financing current assets

Management of cash
To managing cash is one of the most and significant factor for

operation of business. To manage cash it requires deftful knowledge of
managing cash. Though cash fund takes very small part of the total current
assets of the organization. So the organization should contain neither more
nor less amount of the cash because the shortage of cash leads to disturbance
in the business operation while the excessive of cash will remain idle in the
organization, which is not used for the revenue generation. Therefore the
management of the cash takes a large amount of management time.
The major facets of the cash management are
Motive of Cash Holdings:
Generally any organization holds the cash for transaction motive,

precautionary motive and for the speculative motive. In ajmera cement pvt.
Ltd., it holds cash only for the transaction motive. It holds the cash for
smoothing the day-to-day operation only. IT requires the cash for payment of
purchase and payment of wages, salaries and other operating expenses.

There is no any other of motive behind the holding of cash. If there is
surplus of cash in the company than company transfer it to the corporate
Finance division while if there is deficit of the cash in the

organization, then it borrows from finance department.
Cash management cycle:
The key issue in the organization is to manage the cash. The

revenue generated from the sales should be mange in such manner that the
distribution of the cash allotted at the proper place. The cash is significant in
the organization because it used for the payment of needed expenses. The
main aim of any organization is to maintain the minimum cash balance and
invest the surplus fund in opportunity areas. For this purpose the division
transfer its surplus to the finance dept. and that dept. invests that cash in
various opportunity areas.
Managing the flow of cash
Managing the cash flow is very important task that company

should do effectively. Company need to look at cash inflow and cash
outflow about whether it is going in right way or not. So various companies
prepares cash budget but in this Ajmera pvt. Ltd., company does not prepare
cash budget but account dept prepares expenditure budget. The cash
management efficiency will be improved by a proper control on cash
collection and cash disbursement by the management. So the cash collection
should be done as quickly as possible while the cash disbursement should be
delay.
INVENTORY MANAGEMENT
Inventories constitute the most significant part of current assets of

a large majority of companies in India. On an average, inventories are
approximately 60 % of current assets in public limited companies in India.
Because of the large size of inventories maintained by firms, a considerable
amount of funds is required to be committed to them.
NATURE OF INVENTORIES
Raw materials

In Ajmera cement pvt. Ltd., it holds a large amount of the raw
material for its manufacturing of the raw material for its manufacturing of
VRY and other chemicals,
Semi Finished Goods
Some inventories are semi manufactured products. They

represent products that need more work before they become finished
products for sale. Organization also holds some inventories for further
processing.
Finished Goods
Inventories are those completely manufactured products, which

are ready for sale. Stock of raw materials and work in progress facilities
production, while stock of finished goods is required for smooth marketing
operations.
NEED OF HOLD INVENTORIES

The question of managing inventories arises only when the
company holds inventories. Maintaining involves tying up of the companys
funds and incurrence of storage and handling costs. If it is expensive to
maintain inventories, why do companies hold inventories? There are three
general motives for holding inventories.
o Transactions motive: - emphasizes the need to maintain

inventories to facilitate smooth production and sales operations.
o Precautionary motive: - necessitates holding of inventories to

guard against the risk of unpredictable changes in demand and supply forces
and other factors.
o Speculative motive: - influences the decision to increase or

reduce inventory levels to take advantage of price fluctuations.
INVENTORY MANAGEMENT TECHNIQUES:
EOQ (ECONOMIC ORDER QUANTITY)

ABC ANALYSIS

FSN ANALYSIS
RECEIVABEL MANAGEMENT
Trade credit arises when a firm sells its product or services on

credit and does not receive cash immediately. It is an essential marketing
tool, acting as a bridge for the movement of goods through production and
distribution stages to customers. A firm grants trade credit to protect its sales
from the competitors and to attract the potential customers to buy its
products at favorable terms. Trade credit creates account receivable or trade
debtors that the firm is expected to collect in the near future. The customer
from whom receivable or book debts have to be collected in the future are
called trade debtor or simply as debtors and represent the firms claim or
asset. A credit sale has three characteristics:
It involves an element of risk that should be carefully analyzed.

Cash sales are totally risk less, but not to the credit sales as the cash payment
are yet to be received.
It is basis on economic value. To the buyer, the economic value

in goods and services passes immediately at the time of sale, while the seller
expects an equivalent value to be receivable later on.

It implies futurity. The buyer will make the cash payment for
goods and services receivable by him in a future period.
FINANCING WORKING CAPITAL
There are various sources for financing the current assets for the
organization As per the requirement of company can finance the capital from
the short term or long term sources.
POLICIES FOR FINANCING CURRENT ASSETS.

A firm can adopt different financing policies vise a verse
current assets. Three types of financing may be distinguished:-
Long term financing: - The source of long term financing

include ordinary share capital, preference share capital debenture, long
term borrowing from financial institutions and surplus (retained earnings).
Short term financing: - The short term financing is obtained

for a period less than one year. It is arranged in advance from banks and
other suppliers of short term finance in the money market. Short term
finance include working capital fund from banks, public deposits,
commercial paper, facing receivable etc.
Spontaneous financing: - Spontaneous financing refers to the

automatic source of short term arising in the normal course of a business.
Trade (suppliers) credit and outstanding expenses are examples of
spontaneous financing. There is no explicit cost of spontaneous financing. A
firm is expected to utilize these sources of finances to the fullest extent. The
real choice of financing current assets, once the spontaneous sources of
financing have been fully utilized between the long term and short term
source of finances.

SOURCE OF WORKING CAPITAL
The typical sources of working are summarized below:
1) Funds from operations (adjusted net income)

2) Sale of non current assets
i. Sale of long-term investments (shares, bonds/debentures etc.)

ii. Sale of tangible fixed assets like land building, plant, or
requirements
iii. Sales of intangible fixed assets like goodwill, plants, or
copyrights.
3) Long term financing
i. Long-term borrowings (institutional loans, debentures, bonds

etc.)
ii. Issuance of equity and preferences shares.
USES OF WORKING CAPITAL
The typical uses of working capital are as follows:
1) Adjusted net loss from operations.

2) Purchase of non current assets:
i. Purchase of long term investments like shares,

bonds/debentures etc.

ii. Purchase of tangible fixed assets, like land, building,

plant, machinery, equipment etc.
iii. Purchase of intangible fixed assets, like goodwill,

patents, copyrights etc.
3) Repayment of long term debt (debentures or bonds) and

short term debt (bank borrowing).
4) Redemption of redeemable preference share.
5) Payment of cash dividend.
Data interpretation
BALANCE SHEETS OF LAST 5 YEARS
PARTICULAR 31ST MARCH 2016 31ST MARCH 2015

EQUITY & LIABILITY
Shareholders funds share
capital 229365130 229365130
reserve and surplus (98475652) (82500611)
Non-current liability
Other long term lies. 1720262405 1989977510

long term provision 5297264 4829433
Current liability
Trade payables 1638938 4230991
Other current liability 289189910 13093707
Short-term provision 496376 741963
TOTAL 2147769371 2159738123
Assets
Non-current assets
Fixed assets 10117795 10896989
Tangible assets 208202835 208202835
Long term loans & advances
Other non-current assets 1894844572 1399236076
493600000
Current Assets
Inventories 17808776 22913479
Trade receivable 4411519 5712321
Cash and cash equivalent 4030216 11867360
TOTAL 2147769371 2159738123

BALANCE SHEERT OF 2013 & 2014
PARTICULAR 31ST MARCH 2014 31ST MARCH 2013

EQUITY & LIABILITY
Shareholders funds share
capital 229365130 229365130
reserve and surplus (65696544) (50936176)
Non-current liability
Other long term lies. 1876656790 1462084507
long term provision 4237717 3613142
Current liability
Trade payables 3877880 2662909
Other current liability 18118 1008859

Short-term provision 554637 386515
Total 2049013728 1648184885
Assets
Non-current assets
Fixed assets
Tangible assets 11705971 13347012
Long term loans & advances
Other non-current assets 1272038511 888728290
Non-current investment 493600000 493600000
208202835 208202835
Current Assets
Inventories 16903788 17184151
Trade receivable 4787115 9175273
Cash and cash equivalent 33733835 10263610
Short-term loans and
advances 8041671 7683714
Total 2049013728 1648184885

BALANCE SHEERT OF 2012
Particular 31ST MARCH 2012

Sources of fund
Shareholders funds share capital 229365130
reserve and surplus 283283
TOTAL 232188413
Application of fund
Fixed assets 105214869
- depreciation 89281410
15933459
Investment
Current assets, loans and advances
Inventories 19374256
Sundry debtors 38469775
Cash and bank balance 5445520
Loan and advance 1048304588
Less: Current liability and provision

Current liability 1143545834
Provision 3419419
Net current assets (31951695)
Add: P & L A/c 40003814

TOTAL 232188413
Statement showing working capital of 2012

Particular Amount Amount
Current assets (a)
Sundry debtors 38469775
Cash and bank balance 5445520
Loan and advance 1048304588
Total 1111594139
Current liability (b)

Current liabilities 1143545834
Provision 3419419
1146965253
(A-B) Working capital (35371114)

Current assets (a)
Trade receivable 9175273

Cash and bank equivalent 10263610
Short term loans and advances 7683714
Total 44306748

Trade payable 2662909
Other current liability 10008859
Short term provision 386515
Total 4058283
(A-B) Working capital 40248465

Current assets (a)

Total 63466409

Total 4450635

Current assets (a)

Total 47802226

Total 18066661

Current assets (a)
Total 34604168

Total 291320224
(A-B) Working capital (256716056)

Data interpretation: - Statement Showing Working Capital of last 5 years
Particular 2012 2013 2014 2015 2016

Current Assets 1111594139 44306748 63466409 47802226 34604168
Less: Current 1146965253 4058283 4450635 18066661 291320224
Liabilities
Working -35371114 40248465 59015774 29735565 -256716056
Capital
Interpretation
1. In the year of 2012 current liabilities are more then current assets. So, companys
working capital position is not good.
2. In year of 2014 current assets increase then current assets of the year 2013.
3. In the year of 2014 current liabilities increase then current liabilities of the year
2013.
The reasons behind the increase in current assets are
(a) cash and bank balance in 2014 is increase then 2013
(b) increase in inventories because of expansion
The reasons behind the increase in current liabilities are

(a) increase in the creditors because if quality of product
(b) trust of creditors on the name of the organization and group leads to
interest accrued but not due on loan
4. Comparison to 2015 in 2016 current assets decreased.
5. Current liabilities increase in 2016 as compare to 2015.
The reasons behind the decrease in current assets are,
(a) Cash and bank balance decrease in 2016 as compared to 2015
(b) Decrease in inventories due to lack of expansion opportunities.
The reason behind increase in current liabilities is,
(a) Liabilities other then trade payable and short term provision increase.
So, firm requirement of working capital is fluctuated. In 2012 and 2016 it is negative
while in 2013, 2014, 2015 it is positive.

Table showing current ratio of the company

Current ratio = Current Assets
Current Liabilities
Year Current assets Current liabilities Ratio

2012 1111594139 1146965253 0.96
2013 44306748 4058283 10.92
2014 63466409 4450635 14.26
2015 47802226 18066661 2.64
2016 34604168 291320224 0.12
Interpretation
1. The current ratio shows fluctuating trend during the review period.
2. The ideal ratio is 2:1 but company had more the 2:1 ratio in 2013, 2014,
and 2015.

3. This indicates company was not utilizing current assets properly during
the review period.
4. In 2015 company make the efficient use of current assets.
Table showing quick ratio position

Quick ratio = Quick Assets
Current Liabilities
Year Quick assets Current liabilities Ratio

2012 1073124364 1146965253 0.93
2013 27122597 4058283 6.68
2014 46562621 4450635 10.46
2015 24888747 18066661 1.37
2016 16795392 291320224 0.05
Interpretation
1. The quick ratio is showing fluctuating
2. In 2013, 2014 and 2015 quick ratio found more then ideal ratio of 1:1.
3. The above clearly indicate that firm is highly liquid.

Table showing current assets to fixed assets
Current Assets to Fixed Assets = Current Assets

Fixed Assets
Year Current assets Fixes assets Ratio

2012 1111594139 105214869 10.56
2013 44306748 13347012 3.32
2014 63466409 11705971 5.42
2015 47802226 208202835 0.23
2016 34604168 208202835 0.16
Interpretation
1. The fixed turn over ratio showing fluctuating trend.
2. In 2012 fixed turn over ratio is higher then compare to all.
3. a high turn over ratio includes better utilization of the firm fixed assets

Finding
1. It is clear form the study that firm working capital is fluctuated in last 5
years current assets is decreasing comparatively and current liabilities
increasing comparatively.
2. It is clear form the study that in 2010 current liabilities is higher as compare
to all and then it has increased respectively.
3. It is observed that current assets of the firm fluctuated during the review
period.
4. Fixed turnover ratio is high which is satisfactory.
5. Quick ratio is lower in last 2 year compare to 1:1 ratio.
6. Current ratio is much lower in last year.
Suggestion
It is suggested that the company has to maintain sufficient inventory and
which should be on par with the working capital requirement for strengthen
it.
It is clear form the study that liquidity position is increase which has
satisfactory. The company has to maintain the same in future.
The company has to utilize its current assets efficiently only its maintaining
as smooth liquidity position.
Company should try to maintain the fixed turnover as same.
Conclusion
The Ajmera cement pvt. Ltd. is the large scale manufacturing
organization and successful player in cement industry. The company has the
good financial structure and has a good reputation in the market.
The company mange its working capital very effectively. For cash
management it has Corporate Finance Division. It collects the cash from
various centers. While for the payment are paid through two centers.

Being a manufacturing organization, it has to invest large chunk of
amount in its inventory. So here inventory management takes the significant
management time in the operation.
The company follows the accounting laws and standard in its

accounting. The accounting department for the internal and external
disclosure of the accounting statement regularly prepares the books of
accounts.
Form the study I concluded that company should require using its
current assets in more effective way.
Bibliography
By reference book:
1. Marketing management
- Philip Kotler
2. Financial management
- I.M. pandey
3. Human resource management
- Ashvathappa
4. annual reports of Ajmera cement pvt. Ltd.
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A research Report on Working Capital

I the undersigned, Chauhan hiren a student of T.Y.B.B.A.

PREPARED BY:- CHAUHAN HIREN V. -2-

It is really a pleasure for me to prepare a report at this stage,

PREPARED BY:- CHAUHAN HIREN V. -3-

Practical training is an important part in the management

studies. Only bookies knowledge is not the right way of learning

anything especially for the management student. Thus by practical

training of business management, student comes to know that how

management theories apply in the modern business world.

Industrial training has developed awareness in the students

about industrial environment and practice.

During this academic year 2016 2017 as a part of my

studies, I have undergone 15 days practical training in ajmera

cement private limited to knowledge about financial condition.

It was really a great experience for me to get practical

training in such a reputed unit.

PREPARED BY:- CHAUHAN HIREN V. -4-

SR. NO PARTICULARS PAGE.NO

2 History & development

5 Size & form of organization

8 Time keeping system

11 Working capital research report

12 Scope of the study

14 Limitation of the study

15 Working capital management theory

PREPARED BY:- CHAUHAN HIREN V. -5-

PREPARED BY:- CHAUHAN HIREN V. -6-

Ajmera Cement pvt.ltd. is unique project and none of its kind

Ajmera cement pvt.ltd. produce only cement.

PREPARED BY:- CHAUHAN HIREN V. -7-

2) NAME & ADDRESS OF THE COMPANY:-

Name of the unit: Ajmera Cement pvt.ltd

Taluka Maliya Hatina

Register Office 19, Station Plot, Gondal-360311

Present managing body

Owner Mr. Ajmera

History and development of the company

PREPARED BY:- CHAUHAN HIREN V. -9-

Ajmera Cement pvt.ltd. established in 1985 with a semi dry

Ajmera Cement pvt.ltd. Industry first year produce 13052

PREPARED BY:- CHAUHAN HIREN V. - 10 -

Organization basically invests analysis of activities to be

In the ACPL there is functional type of organization. It is clear

PREPARED BY:- CHAUHAN HIREN V. - 11 -

In this form of organization each department reports to a man

A manger having functional authority is a specialist in his own

Size & Form of Organization

According to the government there are three types of the of the

Small Scale Industry:

If the money invested in the organization in near about 1 crore then

Medium Scale Industry:

Large Scale Industry:

Out of this three the Ajmera cement pvt.ltd is large scale

Form of the organization:-

There are many type of organization. Different company uses different

The form of business organization could never satisfied all the

There are mainly six forms of organization which are as under:

Ajmera cement pvt. ltd is Private Company Ltd. Because

Ajmera Cement Private Limited is entirely manufacture unit. It

PREPARED BY:- CHAUHAN HIREN V. - 15 -

Manufacturing process is heart of any organisation. It is

PREPARED BY:- CHAUHAN HIREN V. - 16 -