INDUSTRY PROFILE

India is said to be the worlds highest milk producer and all set to become the worlds largest food factory. Dairy is a place where handling of milk and milk products is done and technology refers to the application of scientific knowledge for practical purposes. Presently there are around 70,000 village dairy cooperatives across the country. Milk is India's number one farm commodity in terms of its contribution to the national economy.

This production is expected to increase to 240 MT by 2020.

Milk production gives employment to more than 72mn dairy farmers.

COMPANY PROFILE
Company name
Plant address

SriKrishna Milks Pvt.Ltd..

Srikrishnagiri, NH-63 Kirwatti, Yellapur tq, Uttar Kannada dist Karnataka # 38,2

Registered office

2ndfloor Eureka junction

Year of establishment

1989
Mr. Hanumanth Pai (Managing director)

Top management

Mr.Dinesh Pai (Joint Managing Director) Mr.Ganesh Kamat (Executive Director)

Company name
Departments

SriKrishna Milks Pvt.Ltd..

production ,ProductMaintenance,Stores ,
Packing ,HR Accounts

Total of employees Machinery details

90 Ammonia compressors, milk pasteurizer, boilers, cream

PRODUCT PROFILE
Milk products:

Natural rich

7 AM

Toned milk

Madhur standard

madhur toned

cold coffee

PRODUCT PROFILE
Tradable products:

Soan Papadi

Mysore Pak

Peda

cup curd

pot curd

khoa

RESEARCH DESIGN

Importance of the study the help of ratio analysis conclusion can the Withliquidity position of the firm is said to bebe drawn regarding ableliquidity position of the firm. The satisfactory if it is to meet current obligations when they become due. Ratio analysis is equally useful in assessing the long term financial viability of a firm. Ratio assets analysis throws light on the degree of efficiency in the management and utilization of its Ratio analysis not only shows stone to remedial measures. the financial position of the company but also serves as a stepping

Objectives of the Study

To study organization in brief.

To measure the profitability of the company

To study departments of the organization. To ascertain financial performance of the company using ratio analysis. One way of determining the right mix of capital is to measure the impacts of different financing plans on Earnings per Share (EPS).

The objective is to find the level of EBIT (Earnings before Interest Taxes) where EPS does not change; i.e. the EBIT Breakeven. At the EBIT Breakeven, EPS will be the same under each financing plan we have under consideration.

DATA COLLECTION METHODS

a) Primary data: Primary data is collected during the training through discussions with departmental heads, Accountants, Assistants and officers b) Secondary data: Secondary data is collected from published annual reports of 5 years of the company. The process of data collection is further supplemented by going through companys website.
LIMITATIONS OF THE STUDY

The most important limitation of the study is that the study depends on the published data and documents such as balance sheet and income statement. The time provided for the study is limited.

ANALYSIS AND INTERPRETATION

EBIT
8,000,000 7,000,000 6,000,000 5,000,000 4,000,000

3,000,000
2,000,000 1,000,000 0

6,734,790

6,882,782

6,405,225

5,667,464

6,093,715

2007-08

2008-09

2009-10

2010-11

2011-12

Interpretation: From the above, it is justifiable that as the operating profit is continuously fluctuating Over the years

NET PROFIT MARGIN

Net Profit Margin
25

20

15 22 17 5 3 0 2007-08 2008-09 2009-10 2010-11 2011-12 11 19

10

Interpretation: From the analysis, it is evident that net profit margin is continuously increasing year by year as compared to 2007-08 to 2011-12, from 3% to 22%

RETURN ON TOTAL ASSETS

Return on Total Assets
4.5
4 3.5 3 2.5 2 3.49 4.08 2.85 1.84

1.5
1 0.5 0 0.42 2007-08 2008-09

2009-10

2010-11

2011-12

Interpretation: From the graph it shows that return on total assets has increased from 2007-08 to 2011-12 which shows there is good return on investment to the company.

OPERATING PROFIT
Operating Profit
2.5

1.5

1.96

1.85

1.75 1.48 1.49

0.5

0 2007-08 2008-09 2009-10 2010-11 2011-12

Interpretation:

From the above analysis it is evident that percentage of operating profit is abnormally very less i.e. less than 2%

RETURN ON CAPITAL EMPLOYED RATIO

Return on Total Capital Employed
11.8 11.6 11.4 11.2 11 10.8 11.61 10.6 11.4 11.34 11.35

10.4
10.2 10 9.8 2007-08 2008-09 2009-10 2010-11 2011-12 10.48

Interpretation: Return on capital employed of the firm keep on decreases as compared to 2007-08 but increasing as compared to 2010-11.

RETURN ON INVESTMENT (ROI)

Return on Investment
2.5

1.5

1 1.64 1.26 0.5 0.76 0 0.18 2007-08 2008-09 2009-10 2010-11

2011-12

Interpretation: From the above analysis it is clear evident that ROI of the company is continuously increased year by year

EARNINGS PER SHARE

EPS
2
1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 0.19 2007-08 2008-09 2009-10 2010-11 2011-12 0.82 1.24 1.82

1.52

Interpretation: From the above analysis it is clear evident that EPS of the company is continuously increased i.e. Rs0.19 per equity share to Rs 1.8 per equity share in 5 year

CASH POSITION RATIO

Cash Position
10 9 8 7 6 5 4 3 2 1 0 2007-08 2008-09 2009-10 2010-11 2011-12 5 9 9 8 8

Interpretation: From the above analysis, it is very clear that availability of cash to company is very strong enough. As against Rs1 liability ready cash availability is Rs8 in the organisation.

DEBT - EQUITY RATIO

Debt Equity
12

10

6 9.23 4

9.76

8.85

8.24

8.08

0 2007-08 2008-09 2009-10 2010-11 2011-12

Interpretation: From the above graph, it indicate that debt equity keep on decreasing expecting 2008-09 i.e. 9.76%

RESEARCH FINDINGS

The net profit margin is increasing continuously so company is more efficient in its financial performance.

Return on total assets is quite impressive and acceptable.

As compared to acceptable industrial norm percentage of operating profit to net sale is very low i.e. less than 2% in all year. Return on capital employed is not healthy and also company not using the investment effectively. Return on equity increasing year by year EPS of the concern is quite healthy and acceptable in recent year i.e. Rs 1.80 per equity share(face value Rs10)

The company has not utilized debt properly.

Proprietary ratio of the firm is quite healthy i.e. average 22% Liquidity position of the company is very strong as cash position against Rs 1 CL is Rs8, however heavy cash balance is more risk and losing of opportunity cost.

SUGGESTION

To improve operating profit margin, company should take immediate serious step to control over operating expenses. Proper cost analysis should be made and cost must be classified into controllable and uncontrollable cost reduction. Cost reduction scheme should be implemented very seriously, to improve overall reforms the company. Management must improve proprietary ratio try to writing off factitious assets. Company has to reduce payables to improve liquid assets. Cash position of the company is quite and healthy company should Maintain the same in coming years.

Margin of Operating profits to net sales must be improved further, so as to meet other financial charges.
Company is properly using its fixed assets to increase the production and company should maintain the same in coming years.

Company should try to reduce its operating expenses

CONCLUSION
From the study undertaken in stipulated 60 days it is concluded that overall performance of the company with reference to profitability, liquidity and solvency is very weak and ineffective Specific Conclusion: Company overall profitability is very negligible because of lack of management skill.

It is surprise that milk transaction and petrol pumps transaction are considered hence accruable analysis not possible. For improving operating profit, company has taken appropriate steps to control the operating expenses. Cost reduction schemes are not effectively implemented by the company. Company has taken the proper steps for effective utilisation of the fixed assets.

EBIT position is justifiable in the current year; EPS will be the same under each finance plane.

BIBLIOGRAPHY

BOOKS: Khan M.Y and Jain P.K, Financial Management, 6th Edition, Tata Mc Graw Hill Publication, New Delhi, 2010 COMPANY PUBLIC REPORT: Annual reports i.e. 2007-08 to 2011-2012
URL: www.hangyosrikrishna.com