CHAPTER-1 COMPANY PROFILE

INTRODUCTION TO FOOTWEAR INDUSTRY

Footwear is a manmade outer covering of foot. It is genially made out of leather but the same can be made with synthetic material. When the human being came into existence, they were needed to protect themselves from heat, cold dampness, dust and roughness of ground while walking, standing, or even running. So they innovate shoes for the protection of their feet. The importance of footwear is highly recognized in western and other advanced countries, so the footwear industry grew in full swing that originated big companies like Nike, Reebok, Gucci, and Adidas etc. But the scenario in India is somewhat different and regretfully as the industry could not develop itself despite the fact that India being second largest populated country in the world, surplus manpower and resource of raw material, whatever the reason being. Till the mid of 20thcentury, the bulk of shoe industry was in cottage sector. Professional cobblers were responsible for production of every type of shoes. But in the past one decade the situation has completely changed because new generation of professionals did not adopt this line as shoemaker and preferred to join white-collar jobs. It resulted in the diversification from schedule caste to other class of people as industrial workers. Up to eighties, Bata was the main source of supply of footwear to the cities and towns with higher standard of living. But taking into consideration the growing standard of living and demand, many new footwear companies came into light like Liberty, Corona, Action, Lakhani etc. Production of footwear at this movement is mainly at Agra, Karnal, Faridabad, Delhi, Kolkata, Kanpur, Mumbai, Madras, and Bangalore etc. Footwear industry in India can never be a heavy industry in general and small entrepreneurs with small investments in machinery and capital could remain for all purposes the backbone of industry. It is the ideal industry for entrepreneurs without much of investment in the industry assuring growing demand and profits. Availability of raw material and manpower is not a problem. So the small sector has to play a vital role in industry development. Depending upon the styles, type and purpose.

HISTORY:
Liberty Group started operation in 1954 and today comprises of five firms, namely Liberty Footwear Company, Liberty Enterprises, Liberty Leathers, Liberty Group marketing Division and Liberty Shoes Limited. The group has an annual turnover of Rs.600 Crores approximately. Liberty has its own studio for design and development of footwear. It manufactures footwear both for export and domestic markets. The company has carved a name for itself in the international market and is Indias largest exporter of footwear to Germany. Liberty Shoes Limited, the public company of the group started commercial production in 1993 and is the countrys leading footwear manufactures today. The company has state of the art production facilities at Libertypuram to manufacturer high quality footwear and its contribution in Liberty Groups total sale is over 30%and its rising steadily.

FOUNDER
Presently all group companies are working under the umbrella of LIBERTY SHOES LTD. Mr.D.P.Gupta, Mr. P.D. Guptaand Mr.R.K .Bansal is the founder of Liberty. In 1944, Mr. P.D. Gupta, despite his family opposition decided to start shoes business. With the name of PAL BOOT HOUSE and investment of Rs.1000/-, Mr. P.D. Gupta along with his brother Mr. D.P. Gupta and his sisters son Mr. R.K. Bansal set up a small shoe business in Karnal city. It was a humble beginning with just 12 workers and production capacity of 24 pairs of shoes per day. But their ambitions were grand. His corporate mission acquired name and fame in domestic market and put Karnal on the countrys map.

The year 1968 was the turning point for liberty, when it got the first export order of 10,000 pairs of footwear from Czechoslovakia. After this, it started export to Hungary, Italy, Sri Lanka, Nepal, U.S., Kenya and Japan.

The group has an annual turnover of Rs.600 crores approximately. Liberty has its own studio for design and development of footwear. It manufactures footwear both for export and domestic markets. The company has carved a name for itself in the international market and is Indias largest exporter of footwear to Germany.

Liberty Shoes Limited, the public company of the group started commercial production in 1993 and is the countrys leading footwear manufacturer today. The company has state of the art production facilities at Libertypuram to manufacture high quality footwear and its contribution in Liberty Groups total sale is over 30% and its rising steadily.

MISSION AND VISION

MISSION:
Enrichment of the lives of the customers globally by our commitment to the industry and in making available product and services that truly matches their desires in terms of style, comfort and value.

VISION:
To keep us the fantastic growth that liberty has shown ever since its inception.

COMPETITORS:Bata India Ltd. Mirza International Ltd. Relaxo Footwears Ltd. Sarup Tanneries Ltd. Super house Ltd.

THE FOOTWEAR CAN BE BROADLY CLASSIFIED INTO THREE GROUPS:

Chappell or open type footwear

Sandal or strap attached footwear.

Boot & shoe or closed type footwear covering most part of the feet.

BANKERS
Industrial Bank Ltd. Central Bank of India Corporation Bank HDFC Bank The Royal Bank of Scotland N.V. Hong Kong & Shanghai Banking Corporation Limited

GROUP DATA AT A GLANCE

Year of Establishment: 1954 Employment: More than 5000 employees Business Investment: US $ 100 Million Status of Business: Flagship Company of the Group, Liberty Shoes Ltd., and a public limited company listed in all major stock exchanges of India.

Present Activities
Second largest footwear manufacturer in the country having fully integrated plants to manufacture various kind of footwear with Annual Production of over 10 million pairs. Annual Turnover: Over US$ 125 Million

LIBERTY is ranked among Top 100 brands in the country. Other 10 Successful National brands, known for its respective segment of footwear

Infrastructure
Various plants spread over 200 acres of land in and around Karnal, Liberty Puram, Gharaunda in Haryana, Dehradun & Roorkee in Uttarakhand, and Punta Sahib in Himachal Pradesh supported by strong Marketing Network having 14 Branch offices 02 Overseas offices 300 Liberty Exclusive Distributors 350 Liberty Exclusive Retail Stores 20 Overseas showrooms

Export Markets
All over the world, mainly with Europe in
Germany United Kingdom France Spain Hungary

Technology
Libertys patented technology HUMANTECH is a combination of human

craftsmanship and technological excellence with following technologies available in the world for Footwear Industry.

Cemented Construction

Direct PVC Injection

Direct PU Injection

Direct EVA Injection

Direct TPU Injection

HUMANTECH
Approach which synergies traditional workmanship with state of the art technology to provide the best quality at the most competitive price. Liberty group companies, set various benchmarks in Footwear Manufacturing within the Groups Production facilities and also to Industry.

CORPORATE PHILOSPHY:
Steeped in a philosophy that has at its core innovation, technology and advancement, we, at Liberty, pride ourselves over and above everything else on our healthy and heart-felt respect for the human ethos. That which projects itself in the expectancy and excitement with which one greets the arrival of the new combined with a sincere and deep regard for the old. That which is appreciative of and adopts at every stage the unique balance between modernization and tradition. Liberty as a brand is constantly evolving to keep pace with the changing trends, styles, beliefs and aspirations of people while maintaining the sanctity of certain traditions like workmanship and good value.

CORPORATE SAGA:
With people as its leitmotif, Liberty has for over 50 years always stayed in touch with the aspirations of every successive generation even as it developed the largest range in the industry catering to every income bracket and age segment. Using the patented 'Humantech' approach that combines the best of talent with the latest in technology. From the price-conscious, value for money seeking buyer to the trendy, global, price-indifferent customer, from the with it all attitude teenager to the conservative seen it all adult just about everybody today finds a good reason for being in Liberty. Liberty is today consolidating and expanding its following which extends from the fashion alleys to the sidewalks with styles that compliment the newest most happening trends and also by turning footwear selling into a byword for personalized service in an ambience and shoe stations in India and abroad.

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THE CREDO:
To ensure that the method we use is the latest technology world-over. To follow the highest standard of honest workmanship in whatever we make. To walk that extra miles to ensure customer satisfaction worldwide. To remain a true cosmopolitan to the spirit. To remain a great corporation to associate with, to work for, to know that:

We Are About People.

LIBERTY RANGE:
The family brand style personified with something for every need. Be it formal or casual, at office or at the beach, a conference or a soiree - Liberty fits in effortlessly.

MANUFACTURING:
What gives Liberty the edge is vertically integrated manufacturing infrastructure on technology basis with completely in-house state of the art production facilities which includes 8 DESMA machines for PU Direct Injection, 15 Machines for PVC Direct Injection, 3 Machines for EVA Injection, 3 PU Injection units for unit sole, six lines for cement lasted injection and one machine for the latest TPU Injection. Above production facilities are maintained with focus on environment cleanliness ISES 2000norms, provides a complete range of family footwear of all seasons and occasions, covers the entire domain of industrial safety and health footwear requirements Liberty also has the ISO: 9001-2000 certification for its Quality, Management System, a testimony to all the system and procedures in place. Liberty is a technology driven company Libertys patented technology is combination of human craftsmanship and technological excellence.
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Liberty has production facilities at the following locations:

Gharaunda, Haryana,
(Approx.95 K.M. from Delhi)

Liberty Puram, Haryana

(Approx.102 K.M. from Delhi)

Karnal, Haryana
(Approx.124 from Delhi)

Satiable, Pounta Sahib, Himachal Pradesh

(Approx 225 K.M. from Delhi)

Batamandi, Paunta Sahib, Himachal Pradesh

(Approx 229 K.M. from Delhi)

Dehradun, Uttaranchal
(Approx. 300 K.M. from Delhi)

Roorkee, Uttaranchal
(Approx. 150 K.M. from Delhi)

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COMPANY INFORMATION

Board of Directors
Adesh Gupta CEO & Executive Director Shammi bansal Executive Director Adarsh Gupta Executive Director Satish Kumar Goel Director(Law & Taxation) Sunil bansal Director Amitabh Taneja Independent Director Prem Chand Garg Independent Director Raghu Goel Independent Director Siddharth Sanghi Independent Director Surendra Kumar Arya Independent Director Vivek Bansal Independent Director

Audit committee
Sunil Bansal Prem Chand Garg RaghubarDayal VivekBansal

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Share transfer committee

Adarsh Gupta Sunil Bansal Prem Chand Garg

Remuneration/Selection Committee
RaghubarDayal Prem Chand Garg Surendra Kumar Arya

Membership & certificate

Confederation of India industry (CII) Federation of India chambers of commerce & industry (FICCI) PHD chamber of commerce and industry (PHDCCI) The associated chambers of commerce and industry of India(ASSOCHAM) Federation of Indian export organization (FIEO) Council for leather export (CLE) ISO 9001

Company secretary & Compliance Officer

Munishkakra (Vice President & Company Secretary)
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GROUP COMPANIES:
Liberty Shoes Limited
The company has a turnover exceeding U.S. $100 million and produces more than 50,000 pairs of footwear a day. The company produces varieties of ranges covering virtually every age group and income category. The products are marketed across the globe through 150 distributors, 350 exclusive showrooms and over 6000 multi-brand outlets, and sold in thousands every day in more than 25 countries including fashion-driven, qualityobsessed nations like France, Italy, and Germany.

Liberty Retail Revolutions Limited:

Liberty Retail Revolutions Limited, the company behind the Revolutions store is a100% subsidiary of Liberty Shoes Limited. The Company is producing more than 50,000 pairs of footwear a day covering virtually every age group and income category. Products are marketed across the globe through 150 distributors, 350 exclusive showrooms and over 6000 multi-brand outlets, and sold in thousands every day in more than 25 countries including fashion-driven, quality-obsessed nations like

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France , Italy , and Germany. Setting new benchmarks in the retail business in India Liberty Retail Revolution scatters to the aspirations of the style-driven in India with an exclusive chain of up market showrooms, Revolutions Concept Stores, at fashion centers across India.Its a concept that has opened new frontiers in retail selling - never seen before fashion hubs, catering to individual styles and looks, in an ambience as magical and exciting as the products lined up a world class range in footwear fashion and accessories.

Liberty White ware Limited:

The newest member of the Liberty Group introduced a range of ceramic sanitary ware and accessories of European design thats inspired by a lifestyle of sheer elegance. Where beauty and functionality achieve perfect harmony. Form compliments finesse. And tradition blends seamlessly into innovation. Produced at a Rs.50 crore state-of-the-art plant at Neemrana Industrial Area of Rajasthan the Beach range of fine bathroom products and accessories including WCs, bidets, washbasins, and shower trays, comprising five distinctive collections each with its own definitive character and style

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BRANDS
This family brand is style personified with something for every need. Be it formal or casual, at office or at the beach, a conference or a soiree Liberty fits in effortlessly.

COOLERS
Theyre cool and theyre hot. Theyre hap and theyre happening. Perfect for those hot summer days. When the sun blisters and the heat strokes, they keep the feet cool and comfortable. But why limit the pleasure to summers?! Heres one brand of sandals that stays cosy and comfy all year round.

FOOTFUN

Something for those little feet as they learn to walk. Airy, light and comfortable with lycra uppers and no laces. In fairy-tale colors and designs.

FORCE-10

The flair, the style and ease that forces the world to take notice. A happening range of sports shoes in far out colors that provides the perfect footnote to a headturning presence.

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FORTUNE

Genuine leather uppers and extra light poly soles help complete the power dressing in men with lan and panache.

GLIDERS

Cool and comfortable, trendy and with it. A range of stunning brogues and smart lace ups that will be noticed and talked about every step of the way.Unmistakably a part of Generation You.

TIPTOPP
Its what Mrs. Junejas of the world love to be seen in. Strappy styles and comfortable heels. And colors that become the envy of all and sundry. Perfect for conquering the neighbourhood in designs that are the latest rage the world over.

WARRIOR
Smart, stylish professional gear crafted from leather uppers and direct injection P.U. soles with steel toe caps and offering the widest range of styles in safety shoes. To master the art of being confident and surefooted on slippery grounds and danger ones.

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WINDSOR

The premium is on lightness, style and comfort which makes it ideal for men who take every challenge effortlessly in their stride.

FREEDOM

A new introduction in the safety footwear segment in Nitrile PVC material, offering customers with waterproof, fire retardant and shock free product in economic range. A safety footwear for industrial use.

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SWOT ANALYSIS

Strengths
Track record of growth in turnover and profits Superior quality Vast experience in domestic and export market

Weaknesses
High prices High lead time Less Variety in sports shoes

Opportunity
Quicker response to customers need To increase share in non leather products

Threats
Heavy competition More aggressive marketing by foreign competitors in sports shoe markets

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NATIONAL AND INTERNATIONAL AWARDS

Leather Export Promotion Merit Award(1975), till 1982.

Haryana Government Export Award(1978-79)

International Asian Award, Jakarta(1982).

European Awards, Paris(1987).

National Award for best Export of Leather Garments(1987-88).

International Award for Good Quality, Brussels, Belgium(1988).

Leather Export Award for Government of India(1991-92).

National Productivity Award from president(1997).

Council of Leather Export(CLE), Indias apex body of leather products exporters, during the international leather fair held at Chennai, conferred is highest award the DOYEN OF INDUSTRY upon Mr.P.D.Gupta on 5th Feb.98.

Worldwide Prestige Award

(WPA)-2001.

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LIBERTY OFFICES
REGISTERED OFFICE
Libertypuram, 13thMile Stone, G.T Karnal Road, Kutail, P.O. BASTRA, Distt.Karnal-132001 (Haryana) Tel. (91)-1748-251111-14 Fax. (91)-1748-251100 E-mail:lpm@libertyshoes.com

CORPORATE OFFICE
2ndFloor, Tower-B, DLF Building No.8 DLF Cyber Citi, Phase II, GURGAON(Haryana) Tel. (91)-124-4616200 Fax. (91)-124-4616222 E-Mail:mail@libertyshoes.com

BRANCHES
Ahmadabad, Agra, Bangalore, Chennai, Delhi, Hyderabad, Jaipur, Jammu, Kolkata, Mumbai, Rajpura and Saharanpur

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RESEARCH & DEVELOPMENT:

Our 2-way channel partners dig their feedback deep and constantly. Hammering String of creative workman at the manufacturing center to produce not just faceless shows dancing down conveyor belts but shoes with character. So the centers have poled 53 years of the research and continuous flow of emotions to redefine the R & Decanter at Liberty Puram.Fusing technology with the sweat of sagacity. Some call it Research & Development Wing some put a price to investments in the Emotional Technology that it comes out as. We call the process HUMANTECH and It price less. Liberty also very active in the area of Research & Development and has a number of firsts to its credit like. 1. Liberty pioneered the PU (Polyurethane) technology in India in footwear industry in 1982 and today is the largest producers of footwear with this technology in Asia. 2. Liberty has developed new material TPE (Thermo-Plastic-Elastomer) for high quality formal footwear. 3. Liberty has developed a high quality Eva Compound for beach footwear. 4. Liberty was the first company commissioning a latest CAD/ CAM System. 5. Die Less Leather cutting machine which is directly attached with its Design &Development Section for speedy process of development of new models of footwear.

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6. Liberty is the only factory in India having water proofing technology approved by SYMPATEX, a name known for water proofing technology worldwide 7. Liberty Management is very thin in size comparing with a huge work force in front line operation.

DESIGN & DEVELOPMENT:

Liberty has well established state of the art design centers which are constantly engaged in designing and developing latest trend setting footwear for the young fashions conscious Indian consumers. On an average 4000 new styles are developed every year out of which roughly 1200 styles are selected and introduced in the market in two seasons i.e. spring / summer and fall, winter.

FINANCIAL
If you think a company that has helped 50 million people think on their feet in style is big stuff, you have seen very little yet. For us the future plans are not something that can be termed as crystal gazing but neatly enclosed ideas idea and deliverables in continuum. We are fast building new brands and products, improving the all times favorites and expending our marketing infrastructure and honing to our skills to further the delight of the consumer. With an overall 25% boom planned each year for the next 5 year you could says that India is only true blue footwear manufacturing multinational is just peaking over the edge.

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DISTRIBUTION NETWORK:
We have distribution network rivals the human arterial system. An reticulate network of retailer showrooms, and exclusive outlets with a reach like blue green marine octopus a structured 2-way feeder-feedback system that both gives and receives an organization of our size would have gone out-of-orbit without a firm support system. Thanks to the vision and drive of our corporate think tank, we now have a sales network that brings the breathtaking world of super footwear right at your feet within seconds. A virtual room service at zero cost, if you will. A marketing system that we have conceived and created, it is understandably, the envy of competition

MORE STORES FROM LIBERTY:

Liberty group is expecting to add Rs.70 Crores from its footwear retail business. Thecompany will invest Rs.7 Crores towards expending Revolution - its exclusivefootwear showroom. This year company will add 10 more stores to take it to 25. Thecompany has also entered the manufacturing of white ware segment of sanitary andbathroom products. Liberty is looking at introducing new design this season too. Thecompany has expended its retail presence in over 100 stores across small and big cities.

LIBERTY PLANS TO EXPAND GLOBAL PRESENCE:

Liberty group has also established manufacturing plant in Uttrakhand state and opening25 exclusive outlets across the country as well as in 7 overseas centers. Each outlet is estimated to see an investment of Rs.7.5 million. With a turnover of Rs.500 Crores the company is emerging as an multinational
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brands with about 350 Exclusive distributors all over the world. as opposed to the earlier model of expending retail outlets we plan to bring down the number of retailer from5000 to 4000. We do not want retail presence for name shake; the ideas to have real brand presence, Liberty plans to open super premium at Singapore, Kualampur, Dhaka, Colombo and Dubai .The currently exports about 25% of footwear production to Germany, Italy, France, United States and the Middle East.

STRENGTH:
At Liberty we upgrade and re-engineer our design every 6 months so that you have something new, with it and futuristic every time you visit us. Our shoes are much more than just B.E. Witching leather work. We understand that a shoe for you is an extension of your personality. And for one who keeps moving onto to stables of desire loaded with exciting world fashions trends we craft the dreams with the help of Capital Fashion Technologists shut away not in dream bars but with their heart mind son the pulse of future fashion.

LIBERTY SHOES LIMITED AN INNERVIEW LOCATION:

The company has entered into a lease agreement for 410 Cannals and 17 Marlas(248500sq. yards) of land on national highway no.1 main G.T. road in Libertypuram,Kutail, district Karnal.The site is around 115 KM from Delhi on national highway between Chandigarh andDelhi. The site is 15KM from Karnal and is well connected with major cities and hasall basis infrastructure facilities.

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BUILDING:
It mainly consists of eight huge halls meant for manufacturing operation facility, rawmaterial and finished goods storage, cutting sections, PVC Sole Section, PU SoleSection, Administrative Block etc. the design and finishing of building is among thebest.The total area of the building is 170 lacks sq.feet(approx) and total cost of building isaround 550 lacks. The building is of RC framed structure.

MACHINARY:
Five(new technology) injection-molding machines are being used by the company for production purpose. All the machines are imported from Italy and Germany. Production of shoes as well as quality of shoes has been increased and problems by of pasting, this sole cracking Recently have one been new

reduced substantially

technology.

computerized machine has been purchased for cutting leather. It has also been imported from Italy

INNOVATIVE APPROACHES:
Entire production units of Liberty are interlinked by SAP, a unique ERP Solutionimplemented for the first time in India in a Footwear Industry with all modules related with Finance, Logistics & supply chain.It is rare to see such clean, state of the art production facility in India with following management systems and tools.

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1. KAIZEN is implemented since 2000 and in practice throughout the organization. 2. 5 S Concept is introduced and in practice since 2001 and presently in matured stage. The impact of 5S implementation is visible in all dept. and shop floors of the organization. We may even consider these units are the model units for any Footwear Industry. 3. LEAN awareness is existing in all production floors of the organization. Value streams are standardized for most of the regularly produced articles. Now theGroup is in the process of integrating Lean Concept with PP Module of SAPfor controlling the flow. 4. ISO 9001:2000 CERTIFICATION is awarded to QMS of one of its units and Group is in the process of getting for other units. Group is having an appointed MR exclusively for monitoring the Quality System. DNV is theCertifying agency and auditors of the QMS. 5. WASTE MANAGEMENT SYSTEM is established in one of their unit and itis a pilot project. Wastage Identification, handling and disposal aredocumented and monitored by frequent internal audits 6. WATER MANAGEMENT SYSTEMis existing in the group. Water wastages almost nil- and water is re-cycled in most of their operations. 7. ISES-2000 norms are followed to ensure the best Social, Health andEnvironmental Standards. This standard is monitored by Indo German Export Promotion Council of India. 8. Liberty is the Committee member for setting the standard for Safety Shoes. The recently released IS: 15298:2000 for Safety shoes is

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followed by Libertyand it is the first in Shoe Industry have applied for Certification to use ISIMark. 9. ENGERGY MANAGEMENT SYSTEM of Liberty is unique in Footwear Industry. Liberty Units have got lot of incentives / discounts from Haryana State Electricity Board for maintaining maximum Power Factor.

INTERNATIONAL EXPERIENCE:
1. Liberty has more than 25 years of experience in Export Business and enjoying Status Holder status as Recognized Export House of India. In 80s when SovietMarket was invaded by Indian Exporters, Liberty was the Market Leader inUSSR. 2. Liberty is having its own office in Russia and Hungary for more than 2 decades. 3. Libertys major operations are mainly with Europe, Middle East, East African, South African countries and USA.4. Major brands of Europe, SALAMANDER, JELA, DEICHMANN, ROMIKA andUSA brands like TODDWELSH are selling only Liberty Shoes under their brand umbrella.

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CONTRIBUTION TO INDUSTRY:
1. Liberty has pioneered in bringing PU Technology to India. Liberty has given a presentation on Footwear foot prints for the future in Asia Pacific Customer Conference 2000 organized by Huntsman

Polyurethane at Singapore on thistechnology. 2. SYMPATEX is a patented technology on Water Proofing recognized worldwide. Liberty is the only company in India having recognition/approval of SYMPATEXon Waterproofing. 3. Safety Shoes are brought to Indian Market for the first time and an exclusivebrand WARRIOR was launched by Liberty in Industrial Segment shoes. Our safety shoes are meeting all DIN / EN standards in respective segments. 4. PU technology was introduced to Government Sector, Liberty has set the standard as member of the BIS Committee. BIS Standard IS: 15298: 2000, applicable for Safety shoes is the Standard on which Liberty is producing Safety shoes for morethan one decade. 5. Liberty Enterprises is the model unit for above Standard and complete testingfacility is available only with Liberty in India after FDDI. 6. Liberty is the First Footwear Manufacturing facility in India awarded with thelatest ISO 9001:2000 Certification. 7. The first and only footwear Industry in India, having SAP ERP with all modulesrelated toInward/Outward supply chain, Materials, Finance and Costing. 8. Liberty has pioneered blend of NITRILE Rubber with PVC in 1996 to make itmore versatile for cold countries usage.

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9. Liberty has developed new material TPE(Thermo Plastic Elastomer) for highquality formal footwear. This material has better properties than PVC or TPR conventionallyused for formal.

SOCIAL CONTRIBUTION:
1. Liberty Footwear Training Institute formed by our Directors is developing thelocal public as technicians of Footwear Industry. 2. Management of Liberty Sponsors the children of Liberty Employees for higher studies gives training and employment after graduation in FDDI. 3. Social and Environmental Standard ISES-2000 is in practice with Liberty. This standard is being monitored by Indo German Export Promotion Project inIndia. 4. The products being used by Liberty are Eco-friendly and providing latesttechnology to Industry when Indian Markets related with Environment &Safety are not even aware about the new standards and technology.

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CHAPTER-2 OBJECTIVE OF THE STUDY

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OBJECTIVES OF THE STUDY

To study the working capital management of company.

To study the optimum level of current assets and current liabilities of the Company.

To study the liquidity position through various working capital related Ratio.

To study the working capital components such as receivables accounts, Cash management, Inventory position.

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CHAPTER-3 SCOPE OF THE STUDY

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SCOPE AND RATIONALE OF THE STUDY

To know about its financial position and help it in evaluating its financial performance in future To know the strength and weak points of the company

To know how company maintain proper balance between liquidity and profitability. To know how company pay current liabilities in time

To know the reason of the changes in the financial position of the company.

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CHAPTER-4 INTRODUCTION OF THE TOPIC

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INTRODUCTION OF THE WORKING CAPITAL MANAGEMENT

Introduction Working capital management

Working capital management is concerned with the problems arise in attempting to manage the current assets, the current liabilities and the inter relationship that exist between them. The term current assets refers to those assets which in ordinary course of business can be, or, will be, turned in to cash within one year without undergoing a diminution in value and without disrupting the operation of the firm. The major current assets are cash, marketable securities, account receivable and inventory. Current liabilities were those liabilities which intended at their inception to be paid in ordinary course of business, within a year, out of the current assets or earnings of the concern. The basic current liabilities are account payable, bill payable, bank over-draft, and outstanding expenses. The goal of working capital management is to manage the firms current assets and current liabilities in such way that the satisfactory level of working capital is mentioned. The current should be large enough to cover its current liabilities in order to ensure a reasonable margin of the safety.

Definition:According to Guttmann &Dougall- Excess of current assets over current liabilities. According to Park & Gladson- The excess of current assets of a business (i.e. cash, accounts receivables, inventories) over current items owned to employees and others (such as salaries & wages payable, accounts payable, taxes owned to government).

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Need of working capital management

The need for working capital gross or current assets cannot be over emphasized. As already observed, the objective of financial decision making is to maximize the shareholders wealth. To achieve this, it is necessary to generate sufficient profits can be earned will naturally depend upon the magnitude of the sales among other things but sales cannot convert into cash. There is a need for working capital in the form of current assets to deal with the problem arising out of lack of immediate realization of cash against goods sold. Therefore sufficient working capital is necessary to sustain sales activity. Technically this is refers to operating or cash cycle. If the company has certain amount of cash, it will be required for purchasing the raw material may be available on credit basis. Then the company has to spend some amount for labour and factory overhead to convert the raw material in work in progress, and ultimately finished goods. These finished goods convert in to sales on credit basis in the form of sundry debtors. Sundry debtors are converting into cash after expiry of credit period. Thus some amount of cash is blocked in raw materials, WIP, finished goods, and sundry debtors and day to day cash requirements. However some part of current assets may be financed by the current liabilities also. The amount required to be invested in this current assets is always higher than the funds available from current liabilities. This is the precise reason why the needs for working capital arise

Gross working capital and Net working Capital

There are two concepts of working capital management

1. Gross working capital Gross working capital refers to the firm s investment I current assets. Current assets are the assets which can be convert in to cash within year includes cash, short term securities, debtors, bills receivable and inventory.

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2. Net working capital Net working capital refers to the difference between current assets and current liabilities. 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 Efficient working capital management requires that firms should operate with some amount of net working capital, the exact amount varying from firm to firm and depending, among other things; on the nature of industries.net working capital is necessary because the cash outflows and inflows do not coincide. The cash outflows resulting from payment of current liabilities are relatively predictable. The cash inflow are however difficult to predict. The more predictable the cash inflows are, the less net working capital will be required.

Type of working capital

The operating cycle creates the need for current assets (working capital). However the need does not come to an end after the cycle is completed to explain this continuing need of current assets a destination should be drawn between permanent and temporary working capital.

1) Permanent working capital

The need for current assets arises, as already observed, because of the cash cycle. To carry on business certain minimum level of working capital is necessary on continues and uninterrupted basis. For all practical purpose, this requirement will have to be met permanent as with other fixed assets. This requirement refers to as permanent or fixed working capital

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2) Temporary working capital

Any amount over and above the permanent level of working capital is temporary, fluctuating or variable, working capital. This portion of the required working capital is needed to meet fluctuation in demand consequent upon changes in production and sales as result of seasonal changes

Determinants of working capital

The amount of working capital is depends upon a following factors There is no specific method to determine working capital requirement for a business. There are a number of factors affecting the working capital requirement. These factors have different importance in different businesses and at different times. So a thorough analysis of all these factors should be made before trying to estimate the amount of working capital needed. Some of the different factors are mentioned here below :42

Nature of business Size of business Manufacturing Cycle Business Fluctuations Production Policy Firms Credit Policy Availability of Credit Growth and Expansion activities Price Level Changes

SOURCES OF WORKING CAPITAL

The company can choose to finance its current assets by

1) Long term sources

2) Short term sources

3) A combination of them. Long term sources of permanent working capital include equity and Preference
shares, retained earnings, debentures and other long term debts from public deposits and financial institution. The long term working capital needs should meet through long term means of financing. Financing through long term Means provides stability, reduces risk or payment. And increases liquidity of the business concern.

Various types of long term sources of working capital are summarized as follow;
Issue of shares Retained earnings
43

Issue of debentures Long term debt

Other sources: sale of idle fixed assets, securities received from employees and
Customers are examples of other sources of finance.

SHORT TERM SOURCES OF TEMPORARY WORKING CAPITAL

Temporary working capital is required to meet the day to day business expenditures. The variable working capital would finance from short term sources of funds. And only the period needed. It has the benefits of, low cost and establishes closer relationships with banker.

SOURCES OF TEMPORARY WORKING CAPITAL

Commercial bank Public deposits Various credits Reserves and other funds

ADVANTAGES OF ADEQUATE WORKING CAPITAL

Increase in debt capacity and goodwill Increase in production inefficiency Exploitation of favorable opportunities

44

 Meeting contingencies adverse changes Available cash discount Solvency and efficiency fixed assets.

Attractive dividend to shareholders

CIRCULATION SYSTEM OF WORKING CAPITAL

In the beginning the funds are obtained from the issue of shares, often supplemented by long term borrowings. Much of these collected funds are used in purchasing fixed assets and remaining funds are used for day to day operation as pay for raw material, wages overhead expenses. After this finished goods are ready for sale and by selling the finished goods either account receivable are created and cash is received. In this process profit is earned. This account of profit is used for paying taxes, dividend and the balance is ploughed in the business. Working capital is considered to efficiently circulated when it turns over quickly. As circulation increases, the investment in current assets will decrease. Current assets turnover ratio speaks about the efficiency of LIBERTY in the utilization of current assets. Fast turnover current assets results in a better rate on investment.

45

4.2 INTRODUCTION ABOUT INVENTORY MANAGEMENT

An average, Inventoriesis approximately 60% of current assets in public Ltd. companies in India. A firm neglecting the management of Inventories will be jeopardizing its long run profitability and may fail ultimately. It is possible for a company for a company to reduce its level of Inventories to a considerable degree. The reduction in excessive inventories carries a favorable impact on a companys profitability. Inventory is composed of assets that will sell or used in future in the normal course of business operations. The assets, which firms store as inventory in anticipation of need, are 1. Raw material 2. Work in progress 3. Finished Goods Inventory, is current assets, but differs from other current assets. Because only financial managers are not involved rather, all the functional areas, i.e. finance, marketing, production & purchasing are involved. The job of the financial manager is to reconcile the conflicting view points of the various functional areas regarding the appropriate inventory level in 0order to fulfill the over all objective of maximizing the owners wealth. Thus, Inventory management like the management of other current assets, should be related to the over-all objective of the firm.

46

PURPOSE OF HOLDING INVENTORY

A firm also needs to maintain inventories to reduce costs and ordering costs and avail quantity discounts. There are three main purposes or motive: 1. Transactions motive: It emphasizes the need to maintain inventories to facilitate smooth production & sales operations. 2. Precautionary motive: It necessitates holding of inventories to guard against the unpredictable changes in demand & supply force & other factors. 3. Speculative motive: It influences the decisions to increase or reduce inventory levels to take advantage of price fluctuations

47

Cash management
Cash is the most liquid asset. It is common denominator to which all other current assets can be reduced because receivable and inventories get converted into cash. Cash is lifeblood of any firm needed to acquire supply resources, equipment and other assets used in generating the product and services.

MOTIVES FOR HOLDING CASH:1. Transaction motive: - To purchaseraw material and pay for operating expenses. Such as: -wages, salaries, lighting etc.

2. Precautionary Motive:- to meet the future contingencies such as: Floods, Strikes and failures of important customers.

3. Speculative Motive:-It helps to take advantages of: An opportunity to purchase raw materials at a reduced price on payment of immediate cash.

Factors to be considered to determining optimum cash balance: Cash shortage costs. Excess cash balance costs. Procurement and management costs. Compensating balance. Firm capacity to borrow in emergence. Efficiency of management.

48

CHAPTER-5 RESEARCH METHODOLOGY

49

RESEARCH METHODOLOGY
Research is an important pre-requisite for a dynamic organization to be prcised. Research is more systematic activity directed towards the discovery and development of organized body of knowledge. Some of the characteristics of research methodology are as follows: 1. Research is directed towards a solution of problem. It may attempt to answer a question or determine the relation between two or more variables. 2. Research involves gathering new data for primary of first hand sources or using existing data for new purposes. 3. Research is based on observable experience or empirical evidence. 4. Research strives to be objective and logical applying every possible test to validate the proceed are employed the data collection and conclusion research

COLLECTION OF DATA
There are two methods of collection of data which are as follows:-

1. Secondary Method 2. Primary Method

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Secondary Method
The methodology followed in conducting the study is to collect data regarding footwear production, working capital and its management, need of working capital in Liberty Shoes Ltd. The facts & data were taken from:-

Magazines Internet Annual report of company

Primary Method
The primary data were collected from asking many individuals, employee of the company. They provide me relevant information for completing my study.

51

CHAPTER-6 RATIO ANALYSIS

52

RATIO ANALYSIS
Meaning of Ratio: - A ratio is simple arithmetical expression of the relationship of
one number to another. It may be defined as the indicated quotient of two mathematical expressions. According to Accountants Handbook by Wixon, Kell and Bedford, a ratio is an expression of the quantitative relationship between two numbers. Ratio Analysis:- Ratio analysis is the process of determining and presenting the relationship of items and group of items in the statements. According to Batty J. Management Accounting Ratio can assist management in its basic functions of forecasting, coordination, control and communication. It is helpful to know about the liquidity, solvency, capital structure and profitability of an organization. It is helpful tool to aid in applying judgment, otherwise complex situations. Ratio analysis can represent following three methods. Ratio may be expressed in the following three ways : 1. Pure Ratio or Simple Ratio: - It is expressed by the simple division of one number by another. For example, if the current assets of a business are Rs. 200000 and its current liabilities are Rs. 100000, the ratio of Current assets to current liabilities will be 2:1. 2. Rate or so Many Times: - In this type, it is calculated how many times a figure is, in comparison to another figure. For example, if a firms credit sales during the year are Rs. 200000 and its debtors at the end of the year are Rs. 40,000, its Debtors Turnover Ratio is 200000/40000 = 5 times. It shows that the credit sales are 5 times in comparison to debtors. 3. Percentage: - In this type, the relation between two figures is expressed in hundredth. For example, if a firms capital is Rs.1000000 and its profit is Rs .200000 the ratio of profit capital, in term of percentage, is 200000/1000000*10 0 = 20%
53

ADVANTAGE OF RATIO ANALYSIS

1. Helpful in analysis of Financial Statements.

2. Helpful in comparative Study.

3. Helpful in locating the weak spots of the business.

4. Helpful in Forecasting. 5. Estimate about the trend of the business. 6. Fixation of ideal Standards.

7. Effective Control. 8. Study of Financial Soundness.

LIMITATIONS OF RATIO ANALYSIS

1. Comparison not possible if different firms adopt different accounting policies.

2. Ratio analysis becomes less effective due to price level changes.

3.

Ratio may be misleading in the absence of absolute data.

4.

Lack of proper standards.

5. False accounting data gives false ratio

6. . Ratios alone are not adequate for proper conclusions

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CLASSIFICATION OF RATIO
According to working capital ratio may be classified in the categories as follows:

Liquidity Ratio Current Ratio Quick Ratio or Acid Test Ratio

Cash Ratio Stock / Inventory Turnover Ratio Debtors or Receivables Turnover Ratio Working Capital Turnover Ratio Profitability Ratio or Income Ratio

LIQUIDITY RATIO
(A) Liquidity Ratio:- It refers to the ability of the firm to meet its current liabilities. The liquidity ratio, therefore, are also called Short-term Solvency Ratio. These ratio are used to assess the short-term financial position of the concern. They indicate the firms ability to meet its current obligation out of current resources. In the words of Saloman J. Flink, Liquidity is the ability of the firms to meet its current obligations as they fall due.

55

Liquidity ratio include two ratio a. Current Ratio b. Quick Ratio or Acid Test Ratio

a. Current Ratio: -This ratio explains the relationship between current assets and
current liabilities of a business.

Formula: Current Ratio = Current Assets/ Current Liabilities

Current Assets:-Current assets includes those assets which can be converted into c ash with in a years time. Current Assets = Cash in Hand + Cash at Bank + B/R + Short Term Investment + Debtors (Debtors Provision) + Stock (Stock of Finished Goods + Stock of Raw Material + Work in Progress) + Prepaid Expenses. Current Liabilities: - Current liabilities include those liabilities which are repayable in a years time. Current Liabilities = Bank Overdraft + B/P + Creditors + Provision for Taxation + Proposed Dividend + Unclaimed Dividends + Outstanding Expenses + Loans Payable within a Year. Significance: - According to accounting principles, a current ratio of 2:1 are supposed to be an ideal ratio. It means that current assets of a business should, at least, be twice of its current liabilities. The higher ratio indicates the better liquidity position; the firm will be able to

56

pay its current liabilities more easily. If the ratio is less than 2:1, it indicates lack of liquidity and shortage of working capital. The biggest drawback of the current ratio is that it is susceptible to window dressing . This ratio can be improved by an equal decrease in both current assets and current liabilities.

b. Quick Ratio: - Quick ratio indicates whether the firm is in a position to pay its
current liabilities within a month or immediately.

Formula: Quick Ratio = Liquid Assets/ Current Liabilities

Liquid Assets means those assets, which will yield cash very shortly

Liquid Assets = Current Assets Stock Prepaid Expenses

Significance: -An ideal quick ratio is said to be 1:1. If it is more, it is considered to be better. This ratio is a better test of short-term financial position of the company.

Cash Ratio: - cashratio indicates how many cash& bank available in the hand of the
company and it also include near cash items.

CASH & BANK CURRENT LIABILITY

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Inventory turnover ratio: -It measures the speed with which thestock of goods
converts into the sale. It also tells whether the working capital invested in the stock is being used to the maximum extent or not. Stock = (Stock of Finished Goods + Stock of Raw Material + Work in progress)

58

FORMULA:Cost of goods sold Average Stock Average Stock = opening stock + closing stock 2 Debtorturnover ratio:This ratio is also known as receivable turnover ratio. It helps in measuring that how efficiently debtors are managed in the business. And how quickly the amount is realized from debtors. FORMULA:

Net Sale Average Accounts Receivable

Average Accounts Receivable= Opening Debtors +Op. B/R+Closing Debtors+Closing B/R 2

Working capital turnover ratio: -Its measure that how many times working
capital is converted into sales.

FORMULA:NetSale Net working capital Net working capital= Current Assets Current Liabilities

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CHAPTER-7 DATA ANALYSIS AND INTERPRETATIONS

60

ANALYSIS AND INTERPRETATION

1. LIQUIDITY RATIOS: CURRENT RATIO = CURRENT ASSETS / CURRENT LIABILTIES

YEAR
Current Assets Current Liabilities

2009-2010 180.59 54.75 3.29

2010-2011 182.60 57.94 3.15

2011-2012 229.31 96.78 2.36

Current Ratio

CURRENT RATIO
3.5 3 2.5 2 1.5 1 0.5 0 2009-10 2010-11 2011-12 2.36 3.29 3.15

Fig 1

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INTERPRETATION:
The Ideal Current Ratio is 2:1. The higher the ratio the better it is. The current ratio of the company was 3.29 in 2009-2010 and in 2010- 2011 it was decreased to 3.15.Then it again decreased from 3.15 to 2.36 in 2011-2012 It is not good sign for company but overall it is not bad.

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2. QUICK RATIO:
QUICK RATIO = QUICK ASSETS_ CURRENT LIABILITES

YEAR Quick Assets Current Liabilities Quick Ratio

2009-2010 104.4 54.75 1.90

2010-2011 106.43 57.94 1.83

2011-2012
126.51 96.78 1.30

QUICK RATIO
2 1.5 1 0.5 0 2009-10 2010-11 2011-12 QUICK RATIO 1.9 1.83 1.3

INTERPRETATION:
The Ideal Quick Ratio is 1:1 It tells short term financial position of the company and more it is considered to be better. It was 1.90 in 2009-10 and in 2010- 2011 it decreased up to 1.83.Then it again decreased from 1.83 to 1.30 in 2011-2012. It is also not good for the company because its decrease continuously.

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3. CASH RATIO:CASH & BANK CURRENT LIABILITY

YEAR Cash & bank Current Liabilities Cash ratio

2009-10

2010-11

2011-12

5.15 53.37
.096

4.13 54.75
.075

10.05 96.78
.103

Cash ratio
0.12 0.1 0.08 0.06 0.04 0.02 0 2009-10 2010-11 2011-12 Cash ratio Cash ratio 0.075 0.096 0.103

INTERPRETATION 1. A ratio of 0.5:1 is considered as standard ratio. 2. The cash ratio has increased .096 to.103 in year 2009 to 2012. 3. This reveals that cash ratio of the company increased in 2012 but it is not sound condition.
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4. INVENTORY TURNOVER RATIO:

NET SALE / COST OF GOODS SOLD
AVERAGE INVENTORY

YEAR Cost of Goods Sold Average Inventory Inventory Turnover Ratio

2009-2010 160.19 71.73 2.23 times

2010-2011 138.02 76.18 1.81 times

2011-2012 303.20 102 2.97 times

Inventory Turnover Ratio

3 2.5 2 1.5 1 0.5 0 2009-10 2010-11 2011-12 Inventory Turnover Ratio Inventory Turnover Ratio 2.23 1.81 2.91

INTERPRETATION
The inventory turnover ratio has first decreased from 2.23 to 1.81, and then increased 2.91 in year 2012 This shows that the company start efficient used in generating the inventory into sales in 2011-12 its good sign for company.
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5. DEBTORS TURNOVER RATIO:NET SALE DEBTOR

YEAR Credit Sales Average Debtors Debtors Turnover Ratio 2009-2010 149.27 71.42 2.09 times 2010-2011 133.45 72.25 1.84 times

2011-2012
138.02* 66.79 2.06 times

2.09 2.1 2.05 2 1.95 1.9 1.85 1.8 1.75 1.7 2009-10

Debtors Turnover Ratio

2.06

1.84

2010-11 2011-12 Debtors Turnover Ratio

INTERPRETATION
1. The debtors turnover ratio has first decreased from 2.09 to 1.84, and then increased 2.06 in year 2011-12. 2. This shows that the overall debtor management system is efficient because timely payment received from debtors.

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6. WORKING CAPITAL TURNOVER RATIO: SALES NET WORKING CAPITAL

2009-10 Net Sales Net Capital W C turnover ratio 1.91 2.09 2.05 240.44 Working 125.46 2010-11 260.66 124.50 2011-12 296.94 144.75

W C turnover ratio
2.1 2.05 2 1.95 1.9 1.85 1.8 2009-10 2010-11 2011-12 W C turnover ratio 1.91 2.09 2.05

INTERPRETATION
1. Working capital ratio of the company was increase 1.91to2.09 in 2011 but decreased to 2.05 in 2012. 2. This shows that the working capital management system is not quite efficient in 2012 but overall it is not bad.

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CHAPTER-8 RESULTS AND FINDINGS

68

FINDINGS

Short term liquidity of the company is not good because current ratio is decrease in 2012.

The cash ratio has increased .075 to .103 in year 2012 but it is not in sound condition for company.

Inventory turnover shows that the company start efficient used in generating the inventory into sales in 2012.

Debtor management system is efficient because its start increase in 2012, timely payment received from debtors.

Working capital management system start decrease in 2012 but overall it is not bad.

But overall company is in a stronger position because profits have increased with 10, 08, 27,126 in 2012 which is 9, 20, 30,760 in2011

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CHAPTER-9 CONCLUSIONS

70

Conclusion

After studying the various ratios it is calculated that. The current ratio has decreased. Its means the company will not able to meet its current liabilities in short time period. But, the cash position of the company is also not quite favorable but it is increasing in 2012. The inventory management system is efficient as the amount of inventory is properly utilized to generate sales in 2012. The debtor management system is efficient as revealed, by the increasing debtor turnover ratio in 2012 with 2.06. However the overall working capital management is well but working capital turnover ratio has decreased in 2012 with 2.05 But still the company is in a stronger position because profits have increased with 10,

08,27,126 in 2012 which is 9,20,30,760in 2011.

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CHAPTER-10 LIMITATIONS OF THE STUDY

72

Limitations of the study

Following limitations were encountered while preparing this project: 1) Limited data:This project has completed with annual reports; it just constitutes one part of data collection i.e. secondary. There were limitations for primary data collection because of confidentiality.

2) Limited period:This project is based on five year annual reports. Conclusions and recommendations are based on such limited data. The trend of last five year may or may not reflect the real working capital position of the company

3) Limited area:Also it was difficult to collect the data regarding the competitors and their financial information. Industry figures were also difficult to get.

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CHAPTER-11 SUGGESTIONS & RECOMMENDATIONS

74

SUGGESTIONS:-

Short term liquidity of the company is not good because current & quick ratio is decrease in 2012. So, company should focus on it.

The company should improve cash ratio which is increased .075 to .103 in year 2012 but it is not in sound condition for the company. Company can increase cash ratio by reducing credit payment period & collection period for maintain proper cash.

Working capital ratio reduced in 2012 it should improve by increasing sale & profits in coming years. By improving services & quality of product and reduced collection period of debtors for increasing working capital.

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CHAPTER-12 BIBLIOGRAPHY

76

BIBLIOGRAPHY

BOOKS Gupta, Shashi K., Management Accounting, Ed.2007, Kalyani Publishers, New Delhi. Kothari, C.R., Research Methodology, Ed.2007, New Age International (P) Limited, Publishers, New Delhi.

MANUAL
25th Annual Reports (2011) 26th Annual Report (2012)

WEBSITES www.liberyshoes.com www.libertyfreedom.com

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CHAPTER-13 APPENDIX ANNUAL REPORTS

78

Particulars Liabilities Share Capital Reserves & Surplus Net Worth Secured Loans Unsecured Loans TOTAL LIABILITIES Assets Gross Block (-) Acc. Depreciation Net Block Capital Work in Progress Investments Inventories Sundry Debtors Cash And Bank Loans And Advances Total Current Assets Current Liabilities Provisions Total Current Liabilities NET CURRENT ASSETS Misc. Expenses TOTAL ASSETS (A+B+C+D+E)

Mar12 12 Months 17.04 114.74 131.78 99.76 1.62 233.16

Mar'11 12 Months 17.04 114.50 131.54 75.04 10.00 216.59

Mar'10 12 Months 17.04 105.30 122.34 82.65 16.44 221.44

Mar'09 12 Months 17.04 97.78 114.82 103.32 15.06 233.19

Mar'08 12 Months 17.04 81.82 98.86 104.03 22.02 224.91

176.49 73.76 102.73 0.05 0.00 102.80 71.58 10.05 44.88 229.31 96.78 2.16 98.94 130.37 0.00 233.16

136.53 53.25 83.28 0.00 17.50 69.71 68.45 4.13 29.69 171.99 54.75 1.44 56.19 115.80 0.00 216.59

131.73 47.08 84.64 0.13 20.34 67.27 70.43 5.15 28.17 171.02 53.37 1.32 54.70 116.32 0.00 221.44

126.06 40.61 85.46 1.55 20.34 76.19 72.41 4.49 27.50 180.59 52.47 2.28 54.75 125.84 0.00 233.19

110.55 35.55 75.01 8.14 17.10 76.17 72.09 4.62 29.72 182.60 52.74 5.20 57.94 124.66 0.00 224.91

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Comparative balance sheet

As on 31st March, 2010 and 31st March, 2011

Particulars

31st march, 2010

31st march, 2011

Increase or decrease

(%) increase or decrease

Sources Of Funds: Shareholders Fund: Equity Share Capital Reserves & Surplus Loan Funds: Secured Loans Unsecured loans 17.04 97.78 103.32 15.06 17.04 81.82 104.03 22.02

0 -15.96 0.71 6.96 -14.87

0 -16.32 0.68 46.21 -6.41

Total Application of Funds (i)Fixed Assets: Gross Block (-) Depreciation Net Block (ii)Investment Current Assets (-) Current Liabilities (iii) Net Current Assets

231.64

216.77

126.06 -40.61 85.46 20.34 180.59 54.75 125.84

110.55 -35.55 75.01 17.1 182.6 57.94 124.66

-15.51 -5.06 -10.45 -3.24 2.01 3.19 -1.18

-12.30 -12.45 -12.22 -15.92 1.11 5.82 -0.93

Total

231.64

216.77

-14.87

-6.41
All fig. in Crores

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INTERPRETATION:
Application of funds in Net Block Asset is decreased by 12.22%. Current Assets have increased by 2.01% whereas Current Liabilities are increased by 5.82%. Reserves & surplus has also decreased by 16.32% due to the increase in net profit of the company.

Comparative balance sheet

As on 31st March, 2009 and 31st March, 2010

Particulars

31st march, 2009

31st march, 2010

Increase or decrease

(%) increase or decrease

Sources Of Funds: Shareholders Fund: Equity Share Capital Reserves & Surplus Loan Funds: Secured Loans Unsecured loans Total Application of Funds: (i)Fixed Assets: Gross Block (-) Depreciation Net Block (ii)Investment Current Assets (-) Current Liabilities (iii) Net Current Assets 131.73 -47.08 84.64 20.34 171.02 54.70 116.32 -4.30% -13.74% 0.96% 0 5.59% 0.09% 8.18% 17.04 105.3 82.65 16.44 216.58 17.04 97.78 103.32 15.06 231.64 0 -7.52 20.67 -1.38 10.34 0 -7.14% 25% -8.39% 4.67%

126.06 -40.61 85.46 20.34 180.59 54.75 125.84

-5.67 -6.47 0.82 0 9.57 0.05 9.52

Total

216.58

231.64

10.34

4.67%

All fig. in Crores

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