A

PROJECT REPORT ON

“A STUDY OF WORKING CAPITAL MANAGEMENT FOR

SUNFRESH AGRO INDUSTRIES PVT LTD(PRABHAT
DAIRY).”

SUBMITTED TO
UNIVERSITY OF PUNE
IN PARTIAL FULFILMENT OFDEGREE OF MCOM

SUBMITTED BY UNDER THE GUIDANCE OF

MR. SONAWANE OMKAR DEEPAK PROF. MRS. SALVE S. K.
ROLL NO- 1786
MBA (FIN.), MCOM, GDC&A
 There are two concepts of working capital; Net working capital
and Gross working capital. Net working capital is defined as the
difference between current assets and current liabilities of a business.
The net concept is useful to judge financial soundness of a firm and it
is of special interest to sundry creditors and suppliers of short-term
loans and advances. It creates confidence among the creditors about
the security of their amount. Thus, Net working capital is the net
current assets (difference between current assets and current
liabilities), whereasGross working capital is the sum of total of all
current assets.
The Company of Prabhat Dairy Ltd. Established in the year 1998 by our
founder SarangNirmal, the Administration is looked after by three dedicated
family directors Mr. KishorNirmal, Mr. ArvindNirmal and Mr. VivekNirmal.

The project work aims to analyse working capital of the company

using Ratio Analysis. All the Conclusions, Suggestions and findings
will be provided after completion of the project work.
 The objectives of the project are as follows:
 To analyze the concept of Working
Capital

 To find the determinants of Working Capital in

Prabhat Dairy Pvt. Ltd

 To study the components of working capital

in Prabhat Dairy Pvt. Ltd.

 The study of overall performance of company.

 The study is based on both primary and
secondary sources of data collection. The
detailed information on various aspects is
obtained from Sunfresh Agro Industries Pvt Ltd
(Prabhat Dairy) and various books and
websites.
 M/S Saikamal Distributors, Aurangabad

Directors Mr. Sarangdhar R. Nirmal (Chairman)

Mr. Vivek S. Nirmal (CEO / Joint MD)
Date of 25 November, 1998
Establishment
Area Covered All India

Auditor CA Amrish Anup Vaidya

Annual Turnover 2016-17 - 14,79,27,541.96/-
2015-16- 11,76,45,321.43/-
2014-15 – 11,08,20,645/-
Net Profit 2016-17 - 14,36,247.20/-
2015-16- 10,78,165.36/-
2014-15 – 9,25,137/-
Kinds of Products Dairy products and beverages.
Distributed
Address Prabhat Dairy Ltd,
121/2 to 121/4, At-Ranjankhol,Post-
Tilaknagar, Tal- Shrirampur, Dist-
Ahmednagar.
Pincode- 413720.
Net Profit 2016-17 - 14,36,247.20/-
2015-16- 10,78,165.36/-
2014-15 – 9,25,137/-
Kinds of Products Dairy products and beverages.
Distributed
 2012
3.5 3.21 Gross Profit Ratio -13
2.8 2.87
3
2.49
2.5
0.988
2 1

1.5 0.95
0.9 Net Profit
1
0.85
0.5
0.8
0
0.75
2013-14 2014-15 2015-16 2016-17
2013- 2014 2015- 2016-
Gross Profit… 14 -15 16 17
 Inventory Turnovr Ratio W/C turnover Ratio
57.42
60 52.89
30
50
25
40
20
30 15
18.19
20 10
10 6.84 5

0 0
2013- 2014- 2015- 2016-
2013- 2014- 2015- 2016- 14 15 16
W/C turnover Ratio 17
14 15 16 2017

Inventory…
Ratios Mar-15 Mar-16 Mar-17 Std ratio Comments

Gross Profit ratio differs from firm to

Gross Profit firm and company to company. Here,
2.86% 2.87% 2.49% NA
Ratio the firm has downward trend in the
Gross Profit, Especially in 2016-17

Net Profit ratio also differs from firm

to firm. Here, The firm had less net
Net Profit Ratio 0.83% 0.92% 0.98% NA
profit ratio in the year 2014-15 but it
has increased in next year s slightly.
 Working capital turnover ratio
indicates the financial position of the
Workinng Capiital Decreasing/
17.07 11.87 28.50 business, Here the ratio is decreasing
Turnover Ratio Increasing
in 16-16 as compared to previous or
next years.

The Stock turnover ratio of a firm

was increasing in 2014-15 and 2015-
Constant/ 16 but it has decreased in 2016-17 by
Stock Turnover Ratio 52.89 57.42 6.84
Increasing a greater extent, This indicates the
firm needs to focus on selling and
distribution.
 The project work comes to the following
conclusions,

 The profit is declining due to increase in milk price and

company is not getting proportionate increase in price of
processed mild andmilk product.
 The company will have to cut down its cost of production to
increase its profit margins.
 Some innovation method are required to procure good
quality milk at reasonable price.
 The firm’s profitability is increasing continuously. But the
net profit has mix trend.
 Company can have its own cattle feed manufacturing unit, or
enter in to contract with cattle feed manufacturing unit to
supply quality cattle feed to farmer at subsidized rate, and these
farmer in term the will supply milk only to PRABHAT MILK at
contractual price. This arrangement will ensure regular supply
of good quality milk from the farmer at reasonable price.

 The Company can use its contact with the local bank procure loan
for farmer or purchase of milk producing cattle.

 Company can also provide subsidized medical facilities for cattle

for Procuring good quality milk.