SUMMER TRAINING PROJECT REPORT

ON
WORKING CAPITAL MANAGEMENT
AT

PASSIVE INFRA
PROJECTS (P)
LTD.
In the partial fulfillment for the award of the degree
Of
BACHELOR OF BUSINESS ADMINISTRATION (BBA)

Submitted by: Project Guide:

Vaishali Arora Dr. Urvashi Sharma
BBA – VI Sem
Enroll No.: 0832151708

CHANDERPRABHU JAIN COLLEGE OF HIGHER STUDIES

& SCHOOL OF LAW

GURU GOBIND SINGH INDERPRASTHA UNIVERSITY

May 2011

DECLARATION
This is to certify that Report entitled “Working Capital Manaagement At Passive Infra
Projects (p) Ltd.” which is submitted by me in partial fulfillment of the requirement for the award
of degree B.B.A GGSIP University, Kashmere Gate, Delhi comprises only my orignal work and
due acknowledgement has been made in the text to all other material used.

Date : Name of Student:

Vaishali Arora

APPROVED BY Name of Guide:

Dr. Urvashi Sharma
 CERTIFICATE

This is to certify that this project report entitled ““Working Capital Manaagement At Passive
Infra Projects (p) Ltd”, submitted in partial fulfillment of the requirement for the award of degree
B.B.A GGSIP University, Kashmere Gate, Delhi ,is bonafide work carried out by Vaishali Arora
(Enrolment No. 0832151708) under my supervision and that no part of this project has been
submitted for any other degree. The assistance and help received during the course of this
investigation has been fully acknowledged.

Dr.Urvashi Sharma
( Project Guide)
 ACKNOWLEDGEMENT

This research project has been both a challenge and an interesting job for me. Valuable assistance
and guidance has been rendered to me during the course of this project,. I am immensely pleased
in recording my gratitude to Dr. Urvashi Sharma under whose guidance this piece of work was
undertaken.
I wish to record my thanks to all the staff of Passive Infra (p) Ltd.for
their assistance and cooperation rendered to me for my research project. I also express my sincere
thanks to the staff of Human Resource and Administration department of Passive Infra (p) Ltd. in
particular Mr. Mithilesh Pandey and Mr. Rajeev Tripathi for their kind cooperation and guidance. I
also feel great pleasure in expressing my deep regards and gratitude to my friends for their support.
I wish to acknowledge for the rewarding help extended to me by
Mr. Varun Agrawal, Mr. Mayank, Agrawal, Mr. Atanu Saha and Mr. Sanjay Pant for their
consistent support and encouragement that helped me to complete this project.

Vaishali Arora
Enrolment No. 0832151708
Table of contents Page No.

Chapter 1 Rationale of study 7

Chapter 2 Objective of study 9

Chapter 3 Company profile 12

Chapter 4 Theoretical perspective 35

Chapter 5 Research methodology 52

Chapter 6 Data analysis and interpretation 54

Chapter 7 Conclusions 64

Chapter 8 Recommendation 69

Chapter 9 Bibliography 70

Chapter 10 Annexure 71
List Of Tables

Tables Page No.

1. Table no.1 55
2. Table no.2 58
3. Table no.3 60
4. Table no.4 61
5. Table no.5 62
6. Table no.6 63

List of Charts

Charts Page No.

1. Chart no.1 56
2. Chart no.2 57
3. Chart no.3 59
4. Chart no.4 60
5. Chart no.5 61
6. Chart no.6 62
7. Chart no.7 63
 CHAPTER-1

RATIONALE FOR THE STUDY

 RATIONALE FOR THE STUDY

Working Capital refers to the capital required by the organization to carry on its day-to-day
operations. The purpose for the study is to understand the concept of Working Capital
Management. Working capital affects the profitability, liquidity and the structural health of the
firm. Effective management of working capital helps the business to carry uninterrupted
production, provide cash discount facility to its customers. All this helps the business to earn good
market value, which ultimately plays an important role in getting competitive edge over the rivals.

The financial managers have to spend much of their time to the daily internal operations, relating
to current assets and current liabilities of the firms. As the largest portion of the financial
manager’s valuable time is devoted to working capital problems, it is necessary to manage
working capital in the best possible way to get the maximum benefit.

Also, there is a direct relationship between a firm’s growth and its working capital needs. As sales
grow, the firm needs to invest more in inventories and debtors. These needs become very frequent
and fast when sales grow continuously. The financial manager should be aware of such needs and
finance them quickly. Continuous growth in sales may also require additional investment in fixed
assets.

The aim of the project is to learn the importance of working capital management for the
efficient utilization of funds and proper financial management of the company. The non-ideal
production technology and imperfect market and distribution systems are responsible for the
generation of current assets, which block the funds of an enterprise.

The project deals with the study of working capital of the company and to find method and
solutions for achieving the most efficient level. It will also look into the approach of risk return.
Working Capital is needed to release such blockage of funds. However the consideration of the
level of investment in current assets should avoid two danger points- excessive and inadequate
investments in current assets.
Working capital management is the most complex thing to manage in a company. Working capital
is just not related to finance department. Various departments affect its working and finance
department has to keep an eye of control over all of them. Its function starts right from estimating
demand by marketing department and before coming to final destination of operating cycle in
finance department it knocks the door of purchasing, quality control, shop floor, stores and finally
to customers. All cost centers have their own style of working and it becomes very difficult to
control the time taken by other department. Though control is being made but it’s not easy to
maintain ideal norms and sometimes it severs the relations of finance people with other department
people.

Irregular trend of operating cycle shows a very dangerous situation because the delay in payment
of accounts payable may result in saving of some interest costs but it can prove very costly to the
firm in the form of loss of credit in the market. This calls for a change in companies policies to
ensure that the payments to the creditors are made at possible stipulated time periods after
obtaining the best credit terms possible.

With the economy in recession and various industries coming up Passive infra projects (p) ltd.
have to look over the quality aspect of its product and strive to offer unmatchable quality at
unbeatable price to regain its market share both in domestic market as well as in foreign market.
 CHAPTER-2

OBJECTIVES OF THE STUDY

10
 TITLE OF THE PROJECT
The title for the project undertaken by me is “Working Capital Management” at
Passive Infra Projects Pvt.Ltd. The aim is to analyze the importance of working capital
as well as analyzing how the manufacturing company manages the working capital,
which is the most complex thing to manage in the company. It is through the working
capital the profitability and the liquidity of the firm is measured. Every manufacturing
company maintains right amount of working capital to get a greater market share as well
as to meet the competition.

Through this project I want to analyze how the working capital affects business activities
right from estimating demand by marketing department and before coming to final
destination of operating cycle in finance department it knocks the door of purchasing,
quality control, shop floor, stores and finally to customers.

11
 OBJECTIVES OF THE PROJECT

1) To determine the effect of liquidity on the profitability of the company.

2) To analyze the short-term financial position of the company.

3) To compare the working capital position of the Passive Infra with its
competitors.

4) To suggest the measures to improve the working capital management of the

company.

12
 SCOPE OF THE PROJECT

This project report focuses on the working capital management of Passive Infra Projects
Pvt. Limited and its comparison with its competitors. The aim of the project is to learn
the importance of working capital management for the efficient utilization of funds and
proper financial management of the company.

The non-ideal production technology and imperfect market and distribution systems are
responsible for blocking of funds of an enterprise. Working Capital is needed to release
such blockage of funds. However the consideration of the level of investment in current
assets should avoid two danger points- excessive and inadequate investments in current
assets.

The concerned unit is a manufacturing unit so a good management of working capital

is indispensable for the company. The content of the report has a clear sequence,
which defines the present background of the company and Passive Infra(p) ltd.
contribution to the market.

It discusses the method of comparison of financial statement of companies like ratio

analysis, working capital analysis and trend analysis etc. Various ratios, which are
required to be calculated, have been stated in the report. The project deals with the
study of working capital of the company and to find method and solutions for
achieving the most efficient level. It will also look into the approach of risk return
trade off in terms of the cost of maintaining a particular level of current assets, which
is the opportunity cost of capital invested in working capital.

13
 LIMITATIONS OF THE PROJECT

1. As only the secondary data is used in this project, it was difficult to determine the
accuracy of the data.

2. The data available was too vast and a lot of time was spent going along through it.

3. A considerable amount of conflicting data was there which was difficult to match
with.

4. Since it is a private limited company, so only unpublished financial data was

available.

5. Because of the company’s policy of maintaining secrecy some amount of data

was not made available to which could have helped me in making my project
report better.

14
 CHAPTER-3

COMPANY PROFILE

15
 1.1 COMPANY INTRODUCTION

Passive Infra specializes in Manufacturing of Structural Steels in India,

and has developed a strong presence in supplying Fabricated &
Galvanized Steel Structures to various companies involved in
infrastructural projects. Backed by the international standards
certification ISO 9001:2000 awarded for its manufacturing facility located
in Haryana on the Delhi Border, the company is now growing in reputation
and business, poised for occupying a prominent place among top steel
fabricating companies in India.

Equipped with a perfect blend of state-of-the-art machines and man-

power, the company enjoys a clear edge over others in delivering jobs
that are totally in sync with the specifications of the clients. The
manufacturing facilities @ passive Infra comprise of hot dip galvanizing,
powder coating, sand blasting, and painting processes, apart from a well
stocked tool room & in-house lab-testing, which is also available for
chemical & physical testing of products at the company’s manufacturing
plant.

The company’s operations are backed by a sound infrastructure and a

world-class manufacturing facility certified for international Standards of
Quality ISO 9001:2008. The vast production facilities spread over 5,34,000
sq. ft. of area on the outskirts of Delhi in Haryana are installed to
fabricate and galvanize 48,000 tons of Steel every year. Moreover, the
company already has the distinction of executing client’s projects
through the previous years of its distinguished operations.

16
Company Profile

01. Name : Passive Infra Projects Pvt. Ltd.

8th KM Stone, Sampla-Kharkhoda
Road,Village Hassangarh, Distt.
Rohtak
Haryana (India)

02. Location : Near Delhi Haryana Border,

Hassangarh.

03. Space : 5,53,756 Sq. Ft. Out of which

2,20,000 Sq. Ft. build up area.

04. Nature of Work : Fabrications ,Galvanizing of Steel,

Painting & Erectioning Structural &
other items.

05. Capacity : 4000 Tons Per Month

06. Layout of Plant : (a) Fabrication Shop.

(b) Galvanizing Plant.
(c) Quality Control Dept.
(d) Dispatch
(e) Administration Block

07. Personnel : Technically qualified Engineers,

Experienced Professionals in
Finance,
Management & other fields
Organization chart attached

08. Experience : 5 years

17
1.2 VISION AND MISSION OF THE COMPANY :

The objectives of Passive Infra can be clearly understood in the following line,
which states

“We at Passive infra will work towards ensuring the success of our company
by primarily focusing on the 3 core possibilities.”

Quality
Product Range
Competency in Technology

The Mission…

The mission statement of Passive Infra states that following…

“We @ Passive Infra will always strive to be leaders in our field by
constantly innovating new ways to better the quality of our products &
services, so that our clients derive maximum benefit from our solutions.”

The Vision…

The vision statement of Passive Infra states that following…

“We at @ Passive Infra envision to maintain the highest level of Quality
under all circumstances. In order to become and remain as market leaders,
we would need to ensure that we deliver what we promise, and operate in
such a way that we also address the rising ecological concerns by
formulating a clear environmental policy”.

18
 1.3 PRODUCT PROFILE:

Passive Infra prides in being an all inclusive resource for all the steel fabrication
requirements of its clients. The company has the expertise to fabricate all grades of MS,
SS and special Alloys as per the guidelines given by the clients. Passive Infra also has
full expertise and capability to fabricate jobs ranging from 1mm thick sheets of steel to
75mmthicksheetsofsteel.
Passive Infra’s core fabrication unit is fully equipped with highly competent and capable
manpower, to fully meet the client’s expectations in terms of quality and reliability. A
perfect blend of adequate infrastructure, state-of-the-art machines, competent man-power
give Passive Infra the fine edge of delivering customized jobs with complete customer
satisfaction.Our products range from Foundation Bolts to Auto Welded Beams. Some of
the products that we are able to manufacture are as follows:

RAIL BRIDGES TOWERS GRILLS

CRASH BARRIERS SUB-STATION STRUCTURES BRIDGE SLEEPERS

19
FOUNDATION BOLTS

1.4 List of Major Clients:

S.NO NAME OF CLIENT ITEMS SUPPLIED

01.Bharat Heavy Electricals Ltd. (BHEL)

Trichy Structure Steel For
Power House
02. Moser Baer Photo Voltaic Ltd
66-B, Udyog Vihar, Structure for Crates
Greater Noida

03. M/s Crompton Greaves Ltd. Sub-Station Structure

3rd Floor, Nokia Building
DLF Cyber City
Gurgaon (Haryana)

04. M/s Indus Towers Limited. Structural Tower Material

Times Square Building, & Accessories
Gurgaon (Haryana)

05. M/s Wireless TT Info Services Ltd. Structural Tower Material

(A Unit of Tata Teleservices Ltd) & Accessories
14th Floor, DLF Square,
Gurgaon, Haryana

06. M/s Reliance Infratel Ltd. Structural Tower Material

DAKC, TFIL Complex, D Block, & Accessories
GF DB-4, Thane-Belapur Road,
Kopar Khairane, Mumbai- 400 710

07. M/s Global Projects & Aviation Pvt. Ltd. Structural Tower Material
303-304 IIIrd Floor, Penunsula Tower-I, & Accessories
Peninsula Corporate Park,
G.K. Marg, Lower Parel (W),
Mumbai- 400 013

08. M/s American Towers ATC India Pvt. Ltd. Structural Tower Material
E-4, 4th Floor, Cristal Plaza, & Accessories
New Link Road, Andheri (W)
Mumbai.

09. M/s Sterling Projects & Engineering Ltd. Structural Tower Material
327, Anna Salai, & Accessories

20
 Chennai- 600 006

Our Clients:

21
We have already earned a good reputation for our quality and timely
supply to our customers as mentioned below:-

SOURCES OF RAW MATERIALS

A. We procure raw materials, i.e. structural steel from the following

sources:

i) Steel Authority of India Ltd. (SAIL)

ii) India Iron & Steel Company Ltd. (IISCO)
iii Rashtriya Ispat Nigam Ltd. (RINL)
iv) Sanvijay Rolling & Engineering Ltd, Nagpur
v) Shri Bajrang Alloys Ltd., Raipur
vi) Other Re-rollers approved by M/s. PGCIL & BIS Certificate.

B. Zinc:

i) Hindustan Zinc Ltd (Special High Grade)

C. M.S. Pipe (Seamless)

i) Jindal Pipe Ltd, New Delhi

ii) Surya Roshni Ltd, Delhi
iii) Bansal Mechanical works Ltd, Kolkata
iv) Asrani Tubes, Hyderabad.
v) Swastik Pipe & Tubes Ltd., Haryana

D. M.S. Nut & Bolts:

i) NEXO,
ii) Remax
iii) In house (PIP)

1.0 Raw Material

1.0
The Raw materials for our products include Sheets/ Plates, Channels, Pipes etc.
They are checked for the dimensions by measurement and the same is recorded in
the inspection sheet. The materials used by us conform to IS 2062 or the material
spec. as required by the customer. For testing the physical properties of raw
materials, one sample is cut from each lot in In-house Laboratory and for testing
the chemical & physical properties, if required as per customer then it is sent to
the authorized NABL lab. These test results are recorded in our Laboratory.

22
2.0 Fabrication

2.1 Cutting

The material is then cut or sheared as per the size required by the customer in

accordance with the shop drawing made by our engineers. Then, the material is

checked to ensure that it is free from burr, sharp edge etc. The record is

maintained by the supervisor on the shop floor in the inspection sheet.

2.2 Drilling / Punching

The material is then drilled / punched on presses or drill machines depending on

the die. of holes and quantity of material. The processed material is checked to

ensure that it is free from burr etc. The dimensional check is conducted by the

supervisors as per the customer specifications.

2.3 Welding

The material is then fixed into a jig of required size made as per the drawing.

Then, the material is welded gradually to make it free from any distortion. The

material is then cleared of flux to see a pinhole-free welding.

23
2.4 Inspection

The material is then fully inspected for its conformity to the drawings. The

rectification or rejection of any non-conforming material is done through visual

appearance

Inspection & Quality Plan for Fabrication & Galvanising

We carry out the following type acceptance and quality assurance Tests:

Raw Material

a) Visual Inspection.

b) Chemical Analysis testing

c) Physical Properties testing
d) Welding testing etc.

Galvanizing

a) Visual Inspection.
b) Adhesion of coating
c) Uniformity of coating
d) Mass of Zinc coating

24
 List of Testing Equipment

FABRICATION UNIT

Sr. Description Capacit Mak Qty. Unit

y

01. Vernier Calipers 02 Nos.

02. MeasuringTapes 10 Nos.

03. Micrometer 02 Nos.

04. Universal Testing Machine 400 KN UTK 01 No.

05. Rockwell Hardness Testing Machine KAS 01 No.

06. Chemical Laboratory For all 01 Set

GALVANISING UNIT:

Sr. Description Capacit Mak Qty. Unit

y

01. Chemicals 01 No.

02. Electronic Alco Meter 01 No.

03. Weight Machine 01 No.

04. Hammer 01 No.

25
 05. Hydro Meter 01 No.

FLOW CHART FOR FABRICATION

Preparation of Bill of Material & shop

floor Drawing

Then arranging the Raw Materials.

Straightening of Raw Material

Quality check of Raw material

Shearing of material to Punching of material as per Check for Burs & then
size as per drawing drawing Grinding

Welding of material as per

drawing/ specification Check for welding Quality

Dimension check of finished

material

26
 Dispatch to Galvanizing

FLOW CHART FOR GALVANIZING

Degreasing of Rinsing in
Rinsing in water Pickling in Acid
material Water

Pre-Heating of Prefluxing the

Check for Acid
Material material

Putting the Putting the

Check for proper
material in Zinc Galvanized
Temperature of
bath at proper Material in
Zinc bath
Temperature Quenching Tank

Visually checking
material for any black Dicromating the
spots & any other Galvanized Material
defects.

Mass of zinc
coating Test for
each lot

Denotion of mark no Sorting the Material

to each member with as per Mark No.
Permanent Marker

Dicromating the
Galvanized Material

27
 List of Statuary Registration:

PAN No. : AAECP 2809D

TIN No. : 06832825351

ECC No. : AAECP2809DXM001

Service Tax No. : AAECP2809DST001

TAN No. : DEL-P-13930A

PF No. : HR/RTK/22152

ESIC/WCP NO. : 360801/41/09/8600000008

Banker’s : Industrial Development Bank of

India Ltd.
(IDBI Bank)
Indian Red Cross Society Building,
1, Red Cross Road,
Post Box No. 231,
New Delhi- 110001

MICR No. : 110259012

IFSC/ RTGS : IBKL0000011

28
ACOUNT NO. : 127-658-400-000-082

ORGANISATION CHART

29
 RITE
(Vice Preside
Mob. 9354403161,

Mayank Agarwal
30
Tarun Pant
(Manager–Purchase)
 CHAPTER-4

THEORETICAL PERSPECTIVE

AN OVERVIEW OF WORKING CAPITAL

MANAGEMENT

31
Working Capital Management is concerned with problems that rise in managing the
current assets, the current liabilities and the interrelationships that exist between them.
The term current assets refers to those assets which in the ordinary course can be, or will
be turned into cash within one year without undergoing a diminution in value and without
disrupting the operations of the firm. Current liabilities are those liabilities, which are
intended at their inception to be paid in the ordinary course of business, within a year out
of current year’s assets or earnings of the firm.

Aim of Working Capital Management

The goal of working capital management is to manage the firm’s current assets and
liabilities in such a way that a satisfactory level of working capital is maintained and
thus ensure its solvency. The current assets should be large enough to cover its current
liabilities in order to ensure a reasonable margin of safety. Each of the current assets must
be managed to maintain liquidity. Working capital management tries to avoid two
danger points –excessive and inadequate investment in current assets. The interaction
between the current assets and liabilities is thus the main theme of Working Capital
Management.

DETERMINANTS OF WORKING CAPITAL

32
A firm should plan its working capital in such a way that it has neither too much nor too
little working capital. Keeping working capital more than its requirement will
unnecessary block the funds increasing the opportunity cost of the firm whereas not
having sufficient level of working capital will bring several bottlenecks for the company
and it has to face liquidity crunch as well as other problems. Following factors are
involved in deciding the quantum of working capital.

I.NATURE OF BUSINESS: Nature of business plays a very vital role in deciding

working capital needs. Business involved in providing services or selling on cash basis
does not need much working capital on the other hand the trading and financial
enterprises have to keep a sufficient amount of cash, inventories and book debts so they
have to invest large amount in working capital.

II.PRODUCTION CYCLE: The term production cycle refers to the time involved in
the production of goods. It covers the time span from procurement of goods to converting
them to finished products. The longer the time span higher will be fund requirement and
therefore more funds will be tied up in working capital.

III.BUSINESS CYCLE: Business fluctuations lead to cyclical and seasonal changes

which in turn cause a shift in working capital position. During boom period the working
capital requirements grow while in depression or recession it falls down.

IV.PRODUCTION POLICY: The quantum of working capital also depends on

production policy. Where the demand of product is seasonal there are two options open to
the enterprise:
a) Either they confine their production to the periods in which purchases are made or
b) They follow a steady production plan throughout the year and produce goods at a level
to meet the peak demand.

33
V.CREDIT POLICY: The level of working capital is also determined by credit policy,
which relates to sales and purchase. The credit policy influences the working capital
requirement in two ways:
a) Through credit terms granted by the firm to its customers
b) Credit terms available to the firm from creditors

VI.AVAILABILITY OF RAW MATERIALS: The availability of raw materials also

affects the quantum of working capital. There can be some material which can not be
acquired easily may be due to non availability. In order to keep the business running, the
company has to acquire these materials in bulk which will require higher working capital.
Some raw materials are available only in particular season which will cause seasonal
fluctuation in working capital requirements.

VII.CHANGES IN PRICE LEVEL: The changes in price levels make it difficult to

manage the working capital requirement. Generally, rising price levels will require a firm
to maintain higher amount of working capital and fall in prices will require less working
capital.

34
 ISSUES IN WORKING CAPITAL MANAGEMENT

Working Capital Management refers to the administration of all aspects of current assets
and current liabilities. The financial manager must determine levels and composition of
current assets. He must see that right sources are tapped to finance current assets, and that
current liabilities are paid in time.
There are many aspects of working capital management, which make it an important
function of the financial manager.
• Time: Working Capital Management requires much of the financial managers
time.
• Investment: Working Capital represents a large portion of the total investment in
assets.
• Criticality: Working Capital Management has great significance for all firms but
it is very critical for small firms.
• Growth: The need for working capital is directly related to the firm’s growth.

35
 Approaches for Working Capital Management

There are three ways for working capital management. These approaches can be called as
1. Matching Approach
2. Conservative Approach
3. Aggressive Approach

Matching Approach: When a firm uses long term sources to finance fixed assets and
permanent current assets and short term financing to finance temporary current assets.
Figure 4 showing firm’s matching approach.

Short
Term
Temporary Current Assets Financing

sets
nt As
Assets

t C urr e
an en
P erm Long
Term
set s
d As
Fixe Financing

Time

Figure 4

36
Conservative Approach: Under this approach a firm finances its permanent assets and
also a part of temporary current assets with long term financing. It relies heavily on long
term finance sources and is less risky so far as solvency is concerned, however, the funds
may be invested in such instruments which fetch small returns to build up liquidity.

Figure 5: Conservative Approach of the firm

Short
Term
Financing

Temporary Current Assets

et s
t As s
Assets

t C urr en
an en
Perm Long
Term
s
dA s set
Fixe Financing

Time

Figure 5

37
Aggressive Approach: The firm uses more short term financing than is justified in the
approach. The firm finances a part of its permanent current assets with short term
resources. This is more risky but may add to the return on assets.

Figure 6: Aggressive approach of the firm.

Short
Term
Temporary Current Assets Financing

ts
As se
Assets

t
urr en
an ent C
Perm Long
Term
s
dA s set
Fixe Financing

Time

Figure-6

EVALUATION OF WORKING CAPITAL MANAGEMENT

38
The following criteria are adopted for evaluating working capital management of a
company.

A) Working Capital Ratios:

1. Liquidity ratio- current ratio, quick ratio or acid test ratio
2. Activity ratio- Inventory Turnover Ratio, Debtors Turnover Ratio,
Creditors Turnover Ratio, Working Capital Turnover Ratio
3. Profitability ratio: Gross Profit Ratios, Operating Ratio

It includes the following ratios:

1. Current Ratio:
Current Assets
Current Liabilities

2. Quick Ratio or Acid Test Ratio:

Quick Assets
Quick Liabilities

3. Working capital Turnover Ratio:

Sales
Working Capital

4. Inventory Turnover Ratio:

Sales
Average Inventory

5. Debtors Turnover Ratio:

39
 Credit Sales
Average Accounts Receivable

6. Creditors Turnover Ratio:

Annual Net Credit Purchases
Average Accounts Payable
7. Gross Profit Ratio:
Gross Profit
Net Sales

8. Operating Ratio:
Cost of Goods Sold +Operating Expenses
Net Sales

Calculation of Working Capital Requirement

Operating cycle = Raw material storage period + WIP Holding period + Finished
Goods storage period + Debtors collection period - Creditors
payment period

B) Cash Management: Cash management is one of the key areas of working

capital management. Apart from the fact that it is the most liquid current asset,
cash is the common denominator to which all current assets can be reduced
because the major liquid assets, that is, receivables and inventory get actually
converted into cash. This underlines the importance of cash management.

Motives for holding cash

There are four primary motives for maintaining cash balances:

40
  Transaction motive
 Precautionary motive
 Speculative motive and
 Compensating motive

Objectives of Cash Management

The basic objectives of cash management are two-fold:
 To meet the cash disbursement needs(payment schedule); and
 To minimize funds committed to cash balances

a) Meeting payments schedule:

In the normal course of business, firms have to make payments of cash on a continuous
and regular basis to supplier of goods, employees and so on. At the same time there is a
constant inflow of cash through collections from debtors. A basic objective of cash
management is to meet the payment schedule, i.e., to have sufficient cash to meet the
cash disbursement needs of a firm.

b) Minimizing funds committed to Cash Balances:

The second objective of cash management is to minimize cash balances. In minimizing
the cash balances, two conflicting aspects have to be reconciled. A high level of cash
balances will ensure prompt together with all the advantages. But it also implies that
larger funds will remain idle, as cash is a non-earning asset and the firm will have to
forego profits. A low level of cash balances, on the other hand, may mean failure to meet
the payment schedule. The aim of cash management, therefore, should be to have an
optimal amount of cash balances.

Factors determining cash needs

41
The factors that determine the required cash balances are:
 Synchronization of cash flows
 Short costs
 Excess cash balance
 Procurement and management
 Uncertainty

C) Cash Budget: The cash budget is probably the most important tool in cash
management. It is a device to help a firm to plan and control the use of cash.
It is a statement showing the estimated cash inflows and outflows over the
planning horizon. In other words, the cash position of a firm as it moves from
one budgeting sub period to another is highlighted by the cash budget.

D) Receivables Management: The receivables represent an important

component of the current assets of a firm. The basic objective of receivables management
is to attain maximum sales with a minimum cost of credit and collections. Trade credits
are granted to push up sales, but the funds locked up in credit sales have opportunity
costs, as such funds can earn returns by alternative employment.

The receivables include:

• Trade credit—credit granted to other firms.

• Consumer credit—credit granted to consumers.

Decision areas in Receivables Management

There are three decision areas in receivables management:

• Terms of the sale

• Credit analysis
• Collection policy

42
E) Inventory Management: Inventory, as a current asset, differs from the other
current assets because only financial managers are not involved. Rather, all the functional
areas finance, marketing, production, and purchasing, are involved. The views
concerning the appropriate level of inventory would differ among the different functional
areas. The job of the financial manager is to reconcile the conflicting viewpoints of the
various functional areas regarding the appropriate inventory levels in order to fulfill the
overall objective of maximizing the owner’s wealth. Thus, inventory management, like
the management of other current assets, should be related to the overall objective of the
firm.

Objectives
The objective of inventory management consists of two counterbalancing parts:
 To minimize investment in inventory, and
 To meet a demand for the product by efficiently organizing the production and
sales operations.
These two conflicting objectives of inventory management can also be expressed in terms
of cost and benefit associated with inventory.

43
 CHAPTER-5

RESEARCH METHODOLOGY

RESEARCH METHODOLOGY

RESEARCH DESIGN

Research design indicates a plan of action to be carried out in connection with a proposed
research work. It provides a guideline for the researcher to enable him to keep track of his
actions and to know that he is moving in the right direction in order to achieve his goal.
The purpose of research is to provide information that will aid in management decision-
making.

44
CASE STUDY METHOD

The case study method is a research design used in the project for the complete
observation of the company so that each and every aspect can be studied in minute details
and then from the case, data generalizations and inferences can be drawn.
For the present project case study method has been adopted for the purpose of analyzing
all components of working capital.

STATISTICAL ANALYSIS

Statistical analysis was conducted through various tools:

Ratio analysis: The Ratio Analysis is used to evaluate the performance of the company.
A comparative analysis has been made for made with norms and with the competitors. In
the project the ratios calculated are:
Liquidity ratio- current ratio, quick ratio or acid test ratio
Activity ratio- Inventory Turnover Ratio, Debtors Turnover Ratio, Creditors Turnover
Ratio, Working Capital Turnover Ratio
Profitability ratio: Gross Profit Ratios, Operating Ratio

Trend analysis: It is one of the useful forms of horizontal analysis in making

comparative study of the financial statements for a number of years. For calculating trend
percentages any year is selected as the base year. Each item of the base year is assumed
to be equal to 100 and on the basis the percentage of each item of each year is calculated.
The trend percentage is helpful in revealing the trend-increase and decrease in various
items.

Comparative statements: Comparative study of financial statements for two or more

years is essential to estimate the future progress of a firm. Inter-firm comparisons are of
great importance in forming the opinion regarding the progress of the enterprise.

45
 COLLECTION OF DATA

DATA SOURCES

Having defined and formulated a research problem and having determined the objectives
of research, a researcher has to face the problem of data collection. The information
collected should be both accurate and relevant, as per the requirements of the researcher,
who has to work out a suitable data collection method.

46
In this project I have used Secondary data most of which was obtained from
internal records of the company, financial statements directors report etc.

CHAPTER-6

47
 DATA ANALYSIS AND
INTERPRETATION

DATA ANALYSIS AND INTERPRETATION

Working Capital Analysis of Passive Infra Projects Pvt Ltd.

Working capital is a financial metric, which represents the amount of day-by-day

operating liquidity available to a business. Also known as operating capital, it is
calculated as current assets minus current liabilities. A company can be endowed with
assets and profitability, but short of liquidity, if these assets cannot readily be converted
into cash.

48
 OPERATING CYCLE OF Passive Infra Projects
Figure 7: Operating cycle of PASSIVE INFRA PROJECTS Pvt Ltd

70

60

50

40

30

20

10

0
2005-06 2006-07 2007-08 2008-09 2009-10

Figure 7

Working capital statement of PASSIVE INFRA PROJECTS till 2009 showing in

figure 8.
PARTICULARS 2005-06 2006-07 2007-08 2008-09 2009-10
12 months 12 months 15 months 15 months 12 months
Raw Material Storage Period 22.38 16.96 21.95 21.49 26.94

WIP Storage Period 5.02 7.02 10.71 10.22 11.19

Finished Goods Storage Period 9.64 9.68 17.24 23.14 20.57

Debtors Collection Period 97.26 69.16 89.54 83.17 72.73

Creditors Payment Period 119.04 76.41 79.76 72.82 99.91

Operating Cycle Period 15.26 26.41 59.68 65.20 31.52

49
 Table 8

The operating cycle shows an irregular trend. It was increasing all the way but all of a
sudden it went down in 2009-10. The main reason behind this is that debtor’s collection
period has decreased and creditors payment period has increased a lot. The credit period
granted by customers is generally 90 days but since the company is running on loss
sometimes it cannot pay the amount in stipulated time, this has led to the increase in
credit period availed from customer and thus decreased the operating cycle to such an
extent.

Inventory Strategy
Inventory strategies vary with the kind of focus strategy and the product market. For a
cost focus strategy, make to stock could be ideal. For focused premium market segment
the strategies could partly be make to stock and partly assemble to order. Focused
differentiation in custom based products may follow inventory strategy of make to order
or engineer to order. In both the cases production would not start until an order is
received.
The PASSIVE INFRA uses Just – In - Time Purchases system for its inventory. The
company runs on the system make to order. Production is made on the basis of order
received or expected orders to be received. The marketing department makes an
estimation of the order to be received and accordingly issues directions to the shop floor

50
for the production requirement. The shop floor on the basis of above requisitions check
out its materials in stock and accordingly issues requisition for purchase of raw materials
to purchase department.

A close look on the figures and graphs showing in figure 9, 10, 11

51
 (Amount in Rupees Lakhs)
PARTICULARS 2005-06 2006-07 2007-08 2008-09 2009-10
Closing Inventory of Raw 251.47 369.10 257.53 357.77 616.38
Materials (A)

Average Inventory (B) 278.68 310.29 313.32 307.65 487.08

Consumption of raw materials(C) 4,449.99 6,489.27 6,382.07 6,303.88 6,400.21

Consumption of raw 12.19 17.78 17.49 17.27 17.53

materials/day (D)

Inventory in days (B/D) 22.86 17.45 17.92 17.81 27.78

Sales 7,414.62 10,623.50 10,213.99 10,176.03 9,671.34

Table 9

R aw M aterials Invento ry In Days

C o nsumptio n of R aw M aterials
per Day
30
25
20 20
15 15
10 10
5 5
0 0
2005- 2006- 2007- 2008- 2009- 2005- 2006- 2007- 2008- 2009-
06 07 08 09 10 06 07 08 09 10

Graph 10 Graph 11

A close look on the figures and graphs above indicates that in the last four years though
the sales remained same or has decreased but the stock of raw materials has increased.
Besides this the consumption has also increased from 66% in 2005-06 to 66.18% in
2009-10. This was due to the fact the company has so far been unable to recover the rise
in price of raw materials from its sales. The price of raw material has increased a lot from
2005 to 2010 but due to stiff competition in the market it cannot be recovered by
increasing the sale price so that the company should not loose its market share. The

52
increase in inventory may pertain to wrong estimation of executable orders based on
which purchases were made which added on to the stock.

Manufacturing Process (Production Phase)

It is the process by which raw material or semi finished goods are converted into finished
goods by doing some processing on them or adding something to them. Given below is
the five-year data. To calculate its effect on working capital requirement work in progress
in operating days is calculated for the following five years.

PRODUCTION PHASE of the PASSIVE INFRA PROJECTS(P) LTD. showing in

table 12.

(Amount in Rupees Lakhs)

PARTICULARS 2005-06 2006-07 2007-08 2008-09 2009-10
Closing WIP 93.25 210.33 174.75 189.43 300.45

Average WIP 75.00 151.79 192.54 182.09 244.94

Cost of Goods Produced 5,449.34 7,893.80 8,195.28 8,125.51 7,988.93

Cost of Goods Produced/day 14.93 21.63 22.45 22.26 21.89

WIP (Operating Days) 5.02 7.02 8.58 8.18 11.19

Table 12

53
Work in Progress (Holding Period 2005-06 to 2009-10) showing in figure 13.

Work In Progress Holding Period

12
10
8
6
4
2
0
2005-06 2006-07 2007-08 2008-09 2009-10

Figure 13
The data above shows that both cost of goods produced and work in progress have
increased during the period. Work in progress holding period has also increased which
should be taken care of. Since cost of goods produced per day and average work in
progress has increased WIP holding period has increased.

RECEIVABLES MANAGEMENT

54
A) Collection of Receivables from Debtors: Accounts receivables of a firm are created
on both sides of the productive system. On one side of this system, the firm may make
advance payments to the suppliers of inventories (raw materials) to ensure timely supply,
particularly when the suppliers hold monopolistic position in the market place, or when
materials are in short supply, or simply to develop a captive supply base. A firm may also
be motivated to make advance payments for pure short term financial and profitability
considerations. Any one or a combination of them will create accounts receivable on the
left side of the productive system which may replace the box for supply creditors or hinge
parallel to it.
On the other side of the productive system, a firm creates accounts receivables when it
sells its outputs on credit. These are popularly termed as sundry debtors by the English to
distinguish it from other forms of accounts receivables. Sundry Debtors constitute nearly
60 percent of accounts receivables of an enterprise. Many of the considerations that
weigh in the minds of a seller are similar to that of making advance payment for supply
of materials, though often on the opposite direction.

B) Size of accounts receivable: Although accounts receivable does not find much place
in economics literature because of its non-existence in national accounting framework
and the assumption of perfect financial market, its enormity as a financial variable cannot
be ignored at the firm level when we find that even in an advanced economy, like the
United States, it constitutes more than 20 % of the total assets of manufacturing firms. In
India, it is about 26%.

C) Trade Credit Marketing Finance Trade Off: Whatever way we look at it, accounts
receivables imply trade credit, and the decision to grant trade credit may either be part of
marketing strategy or pure finance strategy, but mostly it is a trade-off between marketing
and finance strategies of a business.

D) Distribution Channels: Choice of a particular distribution channel has a direct

impact on inventory holding and level of receivables. Even when an enterprise does not
desire to own the entire channel, working capital requirement does not change except

55
marginally. Such is the importance of correct choice of a distribution channel. Direct
marketing or owning a marketing channel (which is also called zero level channel) is best
from the point of view of receivables management. As the manufacturer has direct
control over the distribution system, receivables are closely monitored resulting into
lower level of receivables holding. There is also less distortion in marketing and credit
information flow to the business. While marketing research information enables the firm
to understand quickly the changing consumer needs and product behavior, the credit
information helps it understand credit behaviors of customer, which forms the basic input
to decide whom to grant trade credit and the degree of monitoring required for a
particular customer or a group of customers owing to any change in their
creditworthiness.

As more and more cash is received from the debtors the liquid funds available for the
working of the company increases. In Passive Infra debtors are given a credit period of 90
days. However to encourage an early payment customers are being given a discount of 3
% on payment within 15 days and 1 ½ % on payment within 30 days, with the condition
that they should not have any old outstanding account which is due for more than 60
days. Given below is the data for receivables of the company.

Showing companies debtors / year showing collection from debtors every

In Figure 14 Year in Figure15

56
 Av e rage Debtors
Average Collection Period
2050
120
2000
100
1950
80
1900 60
1850 40
1800 20
1750 0
2005- 2006- 2007- 2008- 2009- 2005- 2006- 2007- 2008- 2009-
06 07 08 09 10 06 07 08 09 10

Figure 14 Figure 15

Table 16 showing debtor from 2004 to 2009.

(Amount in Rupees Lakhs)

PARTICULARS 2005-06 2006-07 2007-08 2008-09 2009-10
Closing Balance of Debtors 1,975.68 2,050.25 1,961.14 1,750.71 2,103.61

Average Debtors 1,975.68 2,012.97 2,005.70 1,855.93 1,927.16

Annual Sales 7,414.62 10,623.50 10,213.99 10,176.03 9,671.34

Average Daily Sales 20.31 29.11 22.40 22.32 26.50

Average Collection Period 97 69 90 83 73

The debtor figures show a mix of ups and downs. Debtors balance has increased and
decreased although the sales have remained almost at the same level. This shows that the
company is trying to hold the customers by giving relaxations in credit terms and
sometimes stringent credit terms were used to avoid liquidity crunch. A significant
decrease in average collection period can be seen from 97 days to 73 days which is a
good sign and depicts efficient receivables management by the company. A decrease in

57
debtors means more funds release for the company from working capital and hence no
need to borrow funds as working capital.

MANAGEMENT OF ACCOUNTS PAYABLE

Accounts payable includes trade credit and accrued expenses which together provide
finance to the operations of a business on an ongoing basis. Accounts payable is the
opposite face of accounts receivable. The former exists because of the latter. The
dominant part of accounts payable is trade credit which is first offered by the seller of
goods which, when accepted by the buyer, creates accounts payable in the books of
accounts of the latter. Passive infra projects used to get a credit period of 0 to 90 days.
However their average payment period stands at 100 days.

Table 17: showing creditors of the PASSIVE INFRA PROJECTS(P) Ltd. from 2005-06
to 2009-10

(Amount in Rupees Lakhs)

PARTICULARS 2005-06 2006-07 2007-08 2008-09 2009-10
Closing Balance of Creditors 1,574.25 1,476.89 1,706.75 1,567.90 2,863.34

Average Creditors 1,574.25 1,525.57 1,591.82 1,637.33 2,215.62

Annual Purchases 7,414.62 10,623.50 10,213.99 10,176.03 9,671.34

Average Daily Purchases 20.31 29.11 22.40 22.32 26.50

Average Payment Period 119 76 80 73 100

Figure 18: showing Average Payment from creditors from 2004 to 2009

58
 Average Payment Period

140
120
100
80
60
40
20
0
2005-06 2006-07 2007-08 2008-09 2009-10

Figure 18

The creditor figures have increased in the long during the period. From 2007-08 to 2008-
09 there have been an increase of almost 82%. This is due to fact that average payment
period has increased from 73 days to 100 days. It means the company is utmost utilizing
the credit period given to it. However a careful look into the profit and loss account of the

Company suggests that the company is running under loss and is suffering from the
liquidity crunch so that may have been the reason for increase in average payment period.

Comparative Analysis of Working Capital through Ratios

59
Various ratios of working capital has been discussed here and compared with the
competitors to analyze the working capital position of the company.

CURRENT RATIO
The liquidity of working capital is an important aspect to be analyzed by the management
for maintaining proper liquid resources to meet operational needs.

Current Ratio indicates firm’s commitment to meet its short-term liabilities & is
calculated by the formula:
Current Assets / Current Liabilities

Rationale: Higher the ratio, larger is the amount available per Rupee of current liability,
the more the firm’s ability to meet current obligations & greater the safety of funds of
short term creditors. Thus current ratio measures margin of safety to creditors. Graph
below compares current ratio past five years with its competitors.

CURRENT RATIO

60
Figure19: Showing current ratio of the PASSIVE INFRA PROJECTS PVT LTD

2.5
2
1.5
1
0.5
0
2005- 2006- 2007- 2008- 2009-
06 07 2008 09 10
PASSIVE INFRA 1.94 2.46 1.89 1.67 1.14
POJECTS
GROZ 1.62 1.39 1.47 1.17 1.04
EVEREST 1.63 1.41 1.45 1.55 1.58
Figure 19

Conventionally ideal current ratio is 2:1, but in practice ideal ratio varies significantly
from industry to industry & from company to company.
The current ratio of Passive infra projects pvt. Ltd varied from 2.46 to 1.14. It has been
fluctuating between the two. However the trend seams to be decreasing. Thus it can be
said that the margin of safety for creditors is decreasing and company’s liquidity position
is deteriorating. But when it is compared to its competitors Groz Ltd. and Everest projects
Ltd. it has still maintained a good position. Hence the decline may be an implication of
market forces because its competitors are also facing the same situation. Only Everest
projects (p) ltd. has managed to improve its current ratio. It means as compared to the
other two Everest projects (p) pvt. Ltd. has a strong liquidity position whereas the
liquidity position of passive infra projects (p) ltd. and Groz projects are declining.

61
 QUICK RATIO

This is most rigorous and absolute test of liquidity position of business unit. It shows to
what extent cash is available with the firm to meet its current liabilities.
Figure 20: Showing Quick ratio of the PASSIVE INFRA PROJECTS

2
1.79

1.5
1.5
1.3 1.32 1.31
1.23
1.17 1.16
1.1 1.09 1.12
1.05
1 0.96
0.81
0.72

0.5

0
2005-06 2006-07 2007-08 2008-09 2009-10
Figure 20Groz
Passive infra projects Everest Projects

The quick ratio of Passive infra projects is showing a declining trend. From 1.5 in 2005 to
0.72 in 2009, it has dipped almost 50%. If we compare its quick ratio to Groz ltd. and
Everest Projects (p) ltd. they are in a better position. . Everest projects has the strongest
quick ratio among the three of 1.16.
This means that the liquidity position of Passive Infra Projects (p) Ltd is not that good. It
is showing insufficiency of funds. Since the company is running into losses it must have
been affected the liquidity position. It is very important for the company to have a good
liquidity position because it may suffer various bottlenecks.

62
From the ratios available for Passive Infra Projects(p) Ltd., it is apparent that it is too less
than the std norm but seeking the kind of industry and its aggressive policy for utilization
of its current assets the ratio seems sufficient but if we compare current ratio and acid test
ratio, then it can be implied that funds are blocked in slow moving inventory. Both the
current and quick ratios should be considered in relation to industry average to infer
whether the firm’s short term financial position is satisfactory or not.

INVENTORY TURNOVER RATIO

Fig 21: showing inventory turnover ratios of the PASSIVE INFRA PROJECTS

20 19.49
16.61 16.8 16.71
15 13.98
12.08
10.18 10.76 10.1 9.53
10.38 9.78
10 9.19
8.16
6.44
5

0
2005-06 2006-07 2007-08 2008-09 2009-10

Passive infra
Figure 21 Groz Everset

The inventory turnover ratio shows how rapidly the inventory is turning into receivable
through sales. Generally a high inventory turnover is indicative of good inventory
management. A low inventory turnover implies excessive inventory levels than warranted
by production and sales activities, or a slow moving or obsolete inventory. We have seen
that the Sales of Passive infra is declining and the company is under losses. Hence a
decreasing inventory turnover ratio implies there is unnecessary tie up of funds, reduced
profit and increased costs. Among the competitors Groz ltd.has the highest inventory
turnover ratio which means that it is efficiently managing its inventory to convert them
into sales.

63
 FIXED ASSETS TURNOVER RATIO

Figure 22: Showing fixed assets turnover ratio of PASSIVE INFRA PROJECTS

8 7.42
6.87
6.43 6.19
6 5.55

4.18 4.23
4 3.34 3.65 3.69
3.16
2.42 2.68 2.68
2.03
2

0
2005-06 2006-07 2007-08 2008-09 2009-10

Passive infra Groz

Figure 22 Everst

Fixed Asset Turnover ratio shows the firm’s ability in generating sales by utilizing fixed
assets. A look on the graph tells the whole story of fixed assets turnover of Passive infra
projects(p) Ltd. It was doing well in 2005 but thereafter it declined and though its
position is somewhat manageable but comparing to its competitors it is not good.

64
CHAPTER-7

CONCLUSION

65
 CONCLUSION

The success or failure of an organization primarily depends on its ability to sustain its
comparative advantage irrespective of the kind of strategy it adopts – cost leadership,
differentiation or focus.
Passive infra projects is doing marvelous job in Manufacturing Industry. It has foreign
market working for it as well.

The companies have many new avenues which will explore new markets and paths of
success. Quality could be the key word for company’s future prospects.
On the other side, after analyzing the financial statements and having a deep study of
working capital cycle of the company,

I found that various ratios do not speak in his favor. From this we can conclude that net
working capital is going down and in the year 2009-10 it has decreased too much. But
prima facie it suggests that investment in current assets has increased much and the
liabilities have also not been fixed to a great extent.

The operating cycle shows an irregular trend. It was increasing all the way but all of a
sudden it went down in 2009-10. The main reason behind this is that debtors collection
period has decreased and creditors payment period has increased a lot.

The credit period granted by customers is generally 90 days but since the company is
running on loss and sometimes it cannot pay the amount in stipulated time, this has led to
the increase in credit period availed from customer and thus decreased the operating
cycle to such an extent.

66
 CHAPTER-8

EXPECTECD CONTRIBUTION
FROM THE STUDY

67
 SUGGESTIONS
After studying the working capital scenario of Passive Infra Projects(p) Ltd.,I would like
to suggest four ways which can be adopted to improve the Working capital

1. Increase net profit

2. Owners add capital to the business
3. Sell unwanted assets
4. Increase long term debt (decrease or shift short term debt)

Increase net profit

• Reducing expenses can be a way to increase profit. For this management need to
evaluate expenses to determine what expenses are essential to be in business and
what expenses are not necessary for operating your business

• Increasing sales is another way to increase net profit. By motivating the sale force
and providing them with an attractive incentive scheme this can be achieved.

• Eliminating certain services and/or products that are too costly and ineffective can
also create more profit

Owners add capital to the business

• Adding capital to business can be accomplished through providing a cash loan to

business or buying additional stock in exchange for cash. After consulting with
finance department this strategy can be adopted.

68
Sell unwanted assets

This can also be a way to improve the working capital of Passive infra projects by selling
unwanted assets which are no more useful in business operations. First they should know
what assets are important to the overall business model. It is critical for a business to
know what the needed, wanted and unwanted assets are for an individual business to best
determine if this avenue will generate additional capital.

Increasing long-term debt

Debt is generally considered as a bad word but it becomes your friend if used
appropriately. Management may Shift some of the short term debt to long term debt.
Done correctly, this could increase cash flow as well as strengthen your balance sheet.

69
CHAPTER-9

APPENDICES

70
 BIBLIOGRAPHY

1. Hrishikesh Bhattacharya, Working Capital Management – Strategies and

Techniques, New Delhi, Prentice Hall of India Private Limited, 2001.

2. Board of Studies – The Institute of Chartered Accountants of India, Financial

Management, New Delhi, ICAI, December 2006.

3. Bolton S.E., Managerial Finance, (Boston) Houghton Miffin Co. 1976, Page no.
388

4. PNB Monthly Review Dec., 1984. Jan., 1985.

5. Roy Chowdary, A.B., Working Capital Management: A work Book on

Corporate Liquidity, Calcutta: Management Technologists of 6 Southern
Avenue, 1987, Page no. 10.

6. Hampton, John J., Financial Decision Making, 1977 ed., Page no. 154

7. www.google.co.in

8. http://studyfinance.com/

9. www.wikipedia.com

10. Official website of snap on tools Pvt ltd.

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72