Project New

CHAPTER - 1
INTRODUCTION
INTRODUCTION:
There are a couple of old sayings in business. One is, "Cash is king." Another is,
"Happiness is a positive cash flow." Surveys are conducted constantly of failed
businesses. Most failed businesses, up to 60%, say that all or most of their failure
was due to cash flow problems. Businesses have to have as their guide another old
saying. Nothing matters more than cash. Making a profit is nice, cash flow is
necessary. Cash management is the key to business success.
Start-up businesses often find themselves short of cash right off the mark. Existing
businesses can find ways to survive if they can find ways to generate cash. Cash is
the single most important element of survival for a small business. Small businesses
often say that an inability to control cash is their single biggest problem.
Just like an individual or a family, companies need cash cushion to rely on. This
gives them security in unstable times. It also gives them an opportunity to take
advantage of strategic investments or take advantage of opportunities to reduce
costs. Small businesses also have to focus on the concept of free cash flow in order
to establish that cash cushion.
Duncan Connor, of Company.com talks about how companies used their cash flow to
remain successful during the recession, "It's a simple case of managing how much
flows in or out of your business and when. Successful businesses managed their
expenses, maximized margins, and built their customer base."
In financial accounting, a cash flow statement, also known as statement of cash
flows or funds flow statement, is a financial statement that shows how changes in
balance sheet accounts and income affect cash and cash equivalents, and breaks
the analysis down to operating, investing, and financing activities. Essentially, the
cash flow statement is concerned with the flow of cash in and cash out of the
business. The statement captures both the current operating results and the
accompanying changes in the balance sheet As an analytical tool, the statement of
cash flows is useful in determining the short-term viability of a company,
particularly its ability to pay bills. International Accounting Standard 7 (IAS 7) is the
International Accounting Standard that deals with cash flow statements.
People and groups interested in management include:
Accounting personnel, who need to know whether the organization will be

able to cover payroll and other immediate expenses
Potential lenders or creditors, who want a clear picture of a company's ability

to repay
Potential investors, who need to judge whether the company is financially

sound
Potential employees or contractors, who need to know whether the company

will be able to afford compensation
Shareholders of the business.
NEED AND IMPORTANCE OF STUDY
Many business owners disregard the importance of Cash management because they
unwittingly believe that their current financial standing can be construed from other
financial reports and projections. Unfortunately, however, a cash flow is necessary
to adequately assess the incoming and outgoing flow of cash and other resources in
a
business.
Not only will a business owner with a cash flow system be more aware of his or her
financial standing, but it will also help investors to make educated decisions on
future investments. A business with regular and reliable cash flow statements shows
more economic
solvency,
and
is
more
attractive
to
investors.
SCOPE OF THE STUDY:

Since it will not be possible to conduct a micro level study of all Cement
industries in Andhra Pradesh, the study is restricted to Ultra Tech Cements
Limited only.
To know cash flow from one to one, as the time available is very limited and
the subjects are very vast, the study is continued to overall financial condition of a
firm.
This study is to know working capital increase or decrease funds from
operation, sources and application of funds of M/S Ultra Tech Cements Limited.
Financial analysis consists of funds flow analysis. To know cash flow from one
to one, as the time available is very limited and study is continued to overall
financial condition of a firm. The study to know working capital increase or
decrease, cash from operation, source and application of funds
OBJECTIVES:
To know the Management of cash in the organization Ultra Tech Cements
Limited.
To access the efficiency with sources and uses of cash were made by the co
ordinance the present year 2009-2010 to 2013-2014.
To identify the changes in the elements of focus and uses of working capital in
between above mentioned year.
To improve the financial performance of the company.
METHODOLOGY OF STUDY:
The following are the main sources of date used for this study which are
Collected and compiled from published and unpublished sources of the Company
data. The published sources are as follows.
1)
Management information system published by
Ultra
Tech
Cements
Limited.
2)
Status Report on Ultra Tech Cements Limited.
3)
Journals, books and other published reports.

The present study is mainly based on primary and secondary sources of Data
collection. The primary data was directly collected by observations, Interviews

questionnaire etc.
The secondary data was collected from the literate available in libraries and
research studies and annual reports are related to the present study. It includes
published and unpublished literature like books, reports and generally Articles of the
Ultra Tech Cements Limited.
LIMITATIONS OF THE STUDY:

The limitations of present study are as follows:
1. The study cover a period of Four years from 2010-2014.
2. The study does not flow the fund.
3. The study is based mainly on secondary information.
4. The study does not touch all the units of Ultra Tech Cements Limited.
5. The present study cannot be used for inter firm comparison.
6. Limited span of time is a major limitation for this project.
7. The act and figures of the study is limited to the period of Four years i.e.
2010-2014
8. The data used in reports are taken from the annal reports published at the
and of the year.
9. The result does not reflect the day-to-day transcations.
10.The data used in reports are taken from the annual reports, published at the
end of the years.
11.The result does not reflect the day-to-day transactions.
12.It is also impossible to the study of day-to-day transactions in cash
management.
13.The analysis of the working capital is taken FIVE years.
CHAPTER-II
INDUSTRY PROFILE
&
COMPANY PROFILE
Cement industry in India:

Introduction:
The Indian cement industry is directly related to the country's infrastructure
sector and thus its growth is paramount in determining the development of the
country. With a current production capacity of around 366 million tonnes (MT), India
is the second largest producer of cement in the world and fueled by growth in the
infrastructure sector, the capacity is expected to increase to around 550 MT by

FY20.
India has a lot of potential for development in the infrastructure and
construction sector and the cement sector is expected to largely benefit from it.
Some of the recent major government initiatives such as development of 100 smart
cities are expected to provide a major boost to the sector.
Expecting such developments in the country and aided by suitable
government foreign policies, several foreign players such as the likes of Lafarge,
Holcim and Vicat have invested in the country in the recent past. Another factor
which aids the growth of this sector is the ready availability of the raw materials for
making cement, such as limestone and coal.
Market Size:
According to data released by the Department of Industrial Policy and
Promotion (DIPP), cement and gypsum products attracted foreign direct investment
(FDI) worth US$ 2,984.29 million between April 2000 and September 2014.
In India, the housing sector is the biggest demand driver of cement, accounting for
about 67 per cent of the total consumption. The other major consumers of cement
include infrastructure at 13 per cent, commercial construction at 11 per cent and
industrial construction at nine per cent.
To meet the rise in demand, cement companies are expected to add 56 MT capacity
over the next three years. The cement capacity in India may register a growth of
eight per cent by next year end to 395 MT from the current level of 366 MT. It may
increase further to 421 MT by the end of 2017. The country's per capita
consumption stands at around 190 kg.
A total of 188 large cement plants together account for 97 per cent of the total
installed capacity in the country, while 365 small plants account for the rest. Of
these large cement plants, 77 are located in the states of Andhra Pradesh,
Rajasthan and Tamil Nadu. The Indian cement industry is dominated by a few
companies. The top 20 cement companies account for almost 70 per cent of the
total cement production of the country.
Investment:
On the back of growing demands, due to increased construction and
infrastructural activities, the cement sector in India has seen many investments and
developments in recent times. Some of them are as follows:
Lafarge and Holcim plans to request for the European Commission's approval for
their possible merger. The two companies had earlier unveiled plans in April
2014 to create the world's biggest cement group with US$ 44 billion in yearly
sales.
JSW cement plans to enter the Kerala market to cash in on the construction
frenzy in the state. JSW is presently building a three million tonnes per annum
(MTPA) capacity plant at Chitrapur in Karnataka to add to the current 5.4 MTPA
capacity in South India.
Zuari Cement through its subsidiary Gulbarga Cement Limited (GCL) plans to set
up a 3.23 MT cement plant in Gulbarga, Karnataka. The company along with the
cement plant is setting up a 50 MW captive power plant in the region.
Malabar Cements plans to set up an automated cement handling and bagging

unit as well as raw materials import facility in the Kochi port. Malabar Cements
has projected a minimum throughput of 300,000 tonnes per annum which can be
extendable up to 600,000 tonnes per annum, apart from intermediate products
and raw materials such as clinker, limestone and coal.
Reliance Cement Company (RCC), a subsidiary of Reliance Infrastructure, has

entered into the cement market of Bihar where the demand for the building
material is on the rise due to a realty boom. RCC presently has plants with total
installed capacity of 5.8 MTPA.
Government Initiatives:
In the 12th Five Year Plan, the government plans to increase
investment in infrastructure to the tune of US$ 1 trillion and increase the industry's
capacity to 150 MT.
The Cement Corporation of India (CCI) was incorporated by the Government of India
in 1965 to achieve self-sufficiency in cement production in the country. Currently,
CCI has 10 units spread over eight states in India.
In order to help the private sector companies thrive in the industry, the government
has been approving their investment schemes. Some such initiatives by the
government in the recent past are as follows:
The Andhra Pradesh State Investment Promotion Board (SIPB) has approved
proposals worth Rs 9,200 corer (US$ 1.48 billion) including three cement plants
and concessions to Hero Motorcar project. The total capacity of these three
cement plants is likely to be about 12 MT per annum and the plants are expected
to generate employment for nearly 4,000 people directly and a few thousands
more indirectly.
India has joined hands with Switzerland to reduce energy consumption and
develop newer methods in the country for more efficient cement production,
which will help India meet its rising demand for cement in the infrastructure
sector.
The Government of India has decided to adopt cement instead of bitumen for the
construction of all new road projects on the grounds that cement is more durable
and cheaper to maintain than bitumen in the long run.
Road Ahead:
With the Government of India providing a boost to the infrastructure and
various housing projects coming up in urban as well as rural areas, the cement
sector has enough scope for development in the future.
Market Size :
The Indian cement sector is expected to witness positive growth in the
coming years, with demand set to increase at a CAGR of more than 8 per cent in the
period FY 2013-14 to FY 2015-16, according to the latest report titled Indian
Cement Industry Outlook 2016 by market research consulting firm RNCOS. The
report further observed that Indias southern region is creating the maximum
demand for cement, which is expected to increase more in future.
The cement and gypsum products sector has attracted foreign direct investments
(FDI) worth US$ 2,656.29 million in the period April 2000August 2013, according to
data published by the Department of Industrial Policy and Promotion (DIPP).
Investments:
Prism Cement Ltd has become the first Indian company to get the Quality
Council of India's (QCI) certification for its ready-mix concrete (RMC) plant in
Kochi, Kerala. The company received the certification from Institute for
Certification and Quality Mark (ICQM), a leading Italian certification body
authorised to oversee QCI compliance.
UltraTech Cement, an Aditya Birla Group Company, has acquired the 4.8 million
tonne per annum (MTPA) Gujarat unit of Jaypee Cement Corp for Rs 3,800 crore
(US$ 595.61 million).
ACC Ltd plans to invest Rs 3,000 core (US$ 470.22 million) to expand its capacity
by nearly 4 MT a year in three eastern region states, over the next three years.
Reliance Cements Co Pvt Ltd will set up a 3 MTPA grinding unit at an estimated
cost of Rs 600 core (US$ 94.04 million). The unit is likely to come up at
Raghunathpur in Purulia, West Bengal.
Reliance Cement Co, a special purpose vehicle (SPV) of Reliance Infrastructure

Ltd, is commissioning its first 5 MTPA plant in Madhya Pradesh. The project has
been implemented at a cost of approximately Rs 3,000 crore (US$ 470.22
million).
Zuari Cement plans to set up a cement grinding unit at Auj (Aherwadi) and
Shingadgaon villages in Solapur, Maharashtra. The new unit will have a
production capacity of 1 MTPA and is expected to be operational by the second
quarter of 2015.
JSW Steel has acquired Heidelberg Cement India's 0.6 MTPA cement grinding
facility in Raigad, Maharashtra, for an undisclosed amount.
Giving impetus to the market, the Indian government plans to roll
out public-private partnership (PPP) projects worth Rs 1 trillion (US$ 15.67 billion)
over the next six months. The Principal Secretary in the Prime Minister's Office
(PMO) will monitor these projects.
Also, the steering group appointed by Dr Manmohan Singh, Prime Minister of India,
to accelerate infrastructure investments, has set deadlines for the awarding of
projects such as Mumbai rail corridor and Navi Mumbai Airport, among others.
The Goa State Pollution Control Board (GSPCB) has signed a memorandum of
understanding (MoU) with Vasavdatta Cement, a company with its plant in
Karnataka. The firm would use the plastic waste collected by the state agencies and
village panchayats from Goa as fuel for its manufacturing plant.
Road Ahead:
The globally-competitive cement industry in India continues to witness
positive trends such as cost control, continuous technology upgradation and
increased construction activities.
Furthermore, major cement manufacturers in India are progressively using
other alternatives such as bioenergy as fuel for their kilns. This is not only helping to
bring down production costs of cement companies, but is also proving effective in
reducing emissions.
With the ever-increasing industrial activities, real estate, construction and
infrastructure, in addition to the various Special Economic Zones (SEZs) being
developed across the country, there is a demand for cement.
It is estimated that the country requires about US$ 1 trillion in the period FY
2012-13 to FY 2016-17 to fund infrastructure such as ports, airports and highways
to boost growth, which promises a good scope for the cement industry.
The 4th Annual India Cement Sector Business Sentiment Survey is nearly out
and the India Construction & Building Materials Journal provides the opportunity of
an exclusive look at the surveys results before their sharing with the wider
audiences. We are glad to be able to present here some of the survey highlights and
provide our readers with before-hand data regarding the views and expectations of
cement industry professionals.
Optimism continues to be the name of the game for the Indian cement
industry a function of long-term trends as well as human nature. But on a closer
look, the survey shows that the optimism only runs skin deep and that it has already
been eroded by an increasing percentage of industry members who feel dissatisfied
with the overall performance of the field last year.
For instance, the percentage of those who believe the industry performed
well dropped from 43 percent in 2012 to 26 percent in 2013, while the number of
respondents who believe the industry performed poorly almost tripled from 8
percent last year to 22 percent in 2013. Regarding the future evolution of the
industry, survey participants continue to be on the optimistic side and hope for a
somewhat better or much better performance compared to the last 6 months.
China tackles pollution and overcapacity:

2013 has been the year that China's central planners took action against
cement production overcapacity and pollution. Consolidation plans for the industry
followed falling profits for cement producers in 2012. However, record air pollution
levels in Beijing in early 2013 shut the city down, raised public awareness and gave
the government a strong lever to encourage further industry consolidation through
environmental controls. By the middle of year profits of major producers were up
but production was also up. Finally in December 2013, China started to launch its
emissions trading schemes (ETS), led by Guangdong province, to create what will be
the second largest carbon market in the world after the EU ETS.India faces a
sticky
wicket
Meanwhile, the world's second largest cement producing country has faced poor
profits and growth for cement producers blamed on paltry demand, piddling prices
and proliferating production costs. Compounding that, the Indian Rupee fell to a
historic low relative to the US Dollar in mid-2013, further putting pressure on input
costs. Holcim reacted to all of this by releasing plans to simplify its presence in the
country between Holcim India, Ambuja and ACC.Sub-Saharan Africa draws up
the
battle
lines
Competition in sub-Saharan Africa is set to intensify when Nigeria's Dangote

Cement opens its first cement plant in South Africa in early 2014. It is the first time
Africa's two largest cement producers, Dangote and South Africa's PPC, will produce
cement in the same country. Future clashes will follow across the region as each
producer increasingly advances toward the other. The Kingdom needs cement...
and
workers
Saudi Arabian infrastructure demands have created all sorts of reverberations

across the Middle Eastern cement industry and beyond as the nation pushes on to
build its six 'economic' cities amongst other projects.
Back in April 2013 King Abdullah bin Abdul-Aziz Al Saud of Saudi Arabia
issued an edict ordering the import of 10Mt of cement. Then some producers
started to report production line shutdowns in the autumn of 2013 as they buckled
under the pressure, although they consoled themselves with solid profit rises. Now,
cement sales have fallen following a government crackdown on migrant workers
that has hit the construction sector.
Europe may be slowly emerging from the economic gloom but anti-trust
regulators have remained vigilant. An asset swap between Cemex and Holcim over
units in the Czech Republic, Germany and Spain has received attention from the
European Commission. In the UK the Competition Commission has decreed that
further action is required for the cement sector following the creation of new player
Hope Construction Materials in 2012. Lafarge Tarmac may now have to sell another
one of its UK cement plants to increase more competition into the market.
Elsewhere in Europe, Belgium regulators took action in September 2013 and this
week we report on Polish action against cartel-like activity.
Don't forget
South-East Asia,
Brazil or
Russia!
Growth continues to dominate these regions and major sporting

tournaments are on the way in Brazil and Russia, further adding to local cement
demand. Votorantim may have cancelled its US$4.8bn initial public offering in
August 2013 but it is still has the highest cement production capacity in Brazil.
Finally, Indonesia may not have had any 'marquee' style story to sum up 2013 but it
continues to regularly announce cement plant builds. In July 2013 the Indonesian
Cement Association announced that cement sales growth had fallen to 'just' 7.5%
for the first half of 2013.
In the most general sense of the word, a cement is a binder, a substance
which sets and hardens independently, and can bind other materials together. The
word "cement" traces to the Romans, who used the term "opus caementicium" to
describe masonry which resembled concrete and was made from crushed rock with
burnt lime as binder. The volcanic ash and pulverized brick additives which were
added to the burnt lime to obtain a hydraulic binder were later referred to as
cementum, cimentum, lament and cement. Cements used in construction are
characterized as hydraulic or non-hydraulic.
The most important use of cement is the production of mortar and concrete
the bonding of natural or artificial aggregates to form a strong building material
which is durable in the face of normal environmental effects.
Concrete should not be confused with cement because the term cement refers only
to the dry powder substance used to bind the aggregate materials of concrete.
Upon the addition of water and/or additives the cement mixture is referred to as
concrete, especially if aggregates have been added.
It is uncertain where it was first discovered that a combination of hydrated
non-hydraulic lime and a pozzolan produces a hydraulic mixture (see also:
Pozzolanic reaction), but concrete made from such mixtures was first used on a
large scale by engineers. They used both natural pozzolans (tress or pumice) and
artificial pozzolans (ground brick or pottery) in these concretes. Many excellent
examples of structures made from these concretes are still standing, notably the
huge monolithic dome of the Pantheon in Rome and the massive Baths of Caracalla.
The vast system of Roman aqueducts also made extensive use of hydraulic cement.
The use of structural concrete disappeared in medieval Europe, although weak
pozzolanic concretes continued to be used as a core fill in stone walls and columns.
Modern cement
Modern hydraulic cements began to be developed from the start of the Industrial
Revolution (around 1800), driven by three main needs:
Hydraulic renders for finishing brick buildings in wet climates
Hydraulic mortars for masonry construction of harbor works etc, in contact with sea
water.
Development of strong concretes.
In Britain particularly, good quality building stone became ever more expensive
during a period of rapid growth, and it became a common practice to construct
prestige buildings from the new industrial bricks, and to finish them with a stucco to
imitate stone. Hydraulic lines were favored for this, but the need for a fast set time
encouraged the development of new cements. Most famous was Parker's "Roman
cement." This was developed by James Parker in the 1780s, and finally patented in
1796. It was, in fact, nothing like any material used by the Romans, but was a
"Natural cement" made by burning septaria - nodules that are found in certain clay
deposits, and that contain both clay minerals and calcium carbonate. The burnt
nodules were ground to a fine powder. This product, made into a mortar with sand,
set in 515 minutes. The success of "Roman Cement" led other manufacturers to
develop rival products by burning artificial mixtures of clay and chalk.
John Smeaton made an important contribution to the development of cements when
he was planning the construction of the third Eddy stone Lighthouse (1755-9) in the
English Channel. He needed a hydraulic mortar that would set and develop some
strength in the twelve hour period between successive high tides. He performed an
exhaustive market research on the available hydraulic lines, visiting their production
sites, and noted that the "hydraulicity" of the lime was directly related to the clay
content of the limestone from which it was made. Smeaton was a civil engineer by
profession, and took the idea no further. Apparently unaware of Smeaton's work, the
same principle was identified by Louis Vacant in the first decade of the nineteenth
century. Vicat went on to devise a method of combining chalk and clay into an
intimate mixture, and, burning this, produced an "artificial cement" in 1817. James
Frost,orking in Britain, produced what he called "British cement" in a similar manner
around the same time, but did not obtain a patent until 1822. In 1824, Joseph Asp
din patented a similar material, which he called Portland cement, because the
render made from it was in color similar to the prestigious Portland stone.
All the above products could not compete with lime/pozzolan concretes because of
fast-setting (giving insufficient time for placement) and low early strengths
(requiring a delay of many weeks before formwork could be removed). Hydraulic
lines, "natural" cements and "artificial" cements all rely upon their belite content for
strength development. Belite develops strength slowly. Because they were burned
at temperatures below 1250 C, they contained no elite, which is responsible for
early strength in modern cements. The first cement to consistently contain elite was
made by Joseph Aspdin's son William in the early 1840s. This was what we call
today "modern" Portland cement. Because of the air of mystery with which William
Asp din surrounded his product, others (e.g. Vicat and I C Johnson) have claimed
precedence in this invention, but recent analysis of both his concrete and raw
cement have shown that William Asp dins product made at North fleet, Kent was a
true elite-based cement. However, Asp dins methods were "rule-of-thumb": Vicat is
responsible for establishing the chemical basis of these cements, and Johnson
established the importance of sintering the mix in the kiln.
William Asp dins innovation was counter-intuitive for manufacturers of "artificial
cements", because they required more lime in the mix (a problem for his father),
because they required a much higher kiln temperature (and therefore more fuel)
and because the resulting clinker was very hard and rapidly wore down the
millstones which were the only available grinding technology of the time.
Manufacturing costs were therefore considerably higher, but the product set
reasonably slowly and developed strength quickly, thus opening up a market for use
in concrete. The use of concrete in construction grew rapidly from 1850 onwards,
and was soon the dominant use for cements. Thus Portland cement began its
predominant role. it is made from water and sand
Types of modern cement

Portland cement
Cement is made by heating limestone (calcium carbonate), with small quantities of
other materials (such as clay) to 1450C in a kiln, in a process known as calcination,
whereby a molecule of carbon dioxide is liberated from the calcium carbonate to
form calcium oxide, or lime, which is then blended with the other materials that
have been included in the mix . The resulting hard substance, called 'clinker', is
then ground with a small amount of gypsum into a powder to make 'Ordinary
Portland Cement', the most commonly used type of cement (often referred to as
OPC).
Portland cement is a basic ingredient of concrete, mortar and most non-speciality
grout. The most common use for Portland cement is in the production of concrete.
Concrete is a composite material consisting of aggregate (gravel and sand),
cement, and water. As a construction material, concrete can be cast in almost any
shape desired, and once hardened, can become a structural (load bearing) element.
Portland cement may be gray or white.
Portland cement blends
These are often available as inter-ground mixtures from cement manufacturers, but
similar formulations are often also mixed from the ground components at the
concrete mixing plant.
Portland blast furnace cement: contains up to 70% ground granulated blast
furnace slag, with the rest Portland clinker and a little gypsum. All compositions
produce high ultimate strength, but as slag content is increased, early strength is
reduced, while sulfate resistance increases and heat evolution diminishes. Used as
an economic alternative to Portland sulfate-resisting and low-heat cements.
Portland fly ash cement: contains up to 30% fly ash. The fly ash is pozzolanic, so
that ultimate strength is maintained. Because fly ash addition allows a lower
concrete water content, early strength can also be maintained. Where good quality
cheap fly ash is available, this can be an economic alternative to ordinary Portland
cement.
Portland pozzolan cement: from other natural or artificial pozzolans. In countries

where volcanic ashes are available (e.g. Italy, Chile, Mexico, the Philippines) these
cements are often the most common form in use.
Portland silica fume cement: Addition of silica fume can yield exceptionally high
strengths, and cements containing 5-20% silica fume are occasionally produced.
However, silica fume is more usually added to Portland cement at the concrete
mixer.
Masonry cements: are used for preparing bricklaying mortars and stuccos, and
must not be used in concrete. They are usually complex proprietary formulations
containing Portland clinker and a number of other ingredients that may include
limestone, hydrated lime, air entertainers, retarders, water proofers and coloring
agents. They are formulated to yield workable mortars that allow rapid and
consistent masonry work. Subtle variations of Masonry cement in the US are Plastic
Cements and Stucco Cements. These are designed to produce controlled bond with
masonry blocks.
Expansive cements: contain, in addition to Portland clinker, expansive clinkers
(usually sulfoaluminate clinkers), and are designed to offset the effects of drying
shrinkage that is normally encountered with hydraulic cements. This allows large
floor slabs (up to 60 m square) to be prepared without contraction joints.
White
blended
cements: may be made using white clinker and white
supplementary materials such as high-purity met kaolin.

Colored cements: are used for decorative purposes. In some standards, the
addition of pigments to produce "colored Portland cement" is allowed. In other
standards (e.g. ASTM), pigments are not allowed constituents of Portland cement,
and colored cements are sold as "blended hydraulic cements".
Very finely ground cements: are made from mixtures of cement with sand or
with slag or other pozzolan type minerals which are extremely finely ground
together. Such cements can have the same physical characteristics as normal
cement but with 50% less cement particularly due to their increased surface area
for the chemical reaction. Even with intensive grinding they can use up to 50% less
energy to fabricate than ordinary Portland cements.
Non-Portland hydraulic cements
Mixtures of ground pozzolan and lime are the cements used by the Romans, and
are to be found in Roman structures still standing (e.g. the Pantheon in Rome). They
develop strength slowly, but their ultimate strength can be very high. The hydration
products that produce strength are essentially the same as those produced by
Portland cement.
Slag-lime cements: Ground granulated blast furnace slag is not hydraulic on its
own, but is "activated" by addition of alkalis, most economically using lime. They
are similar to pozzolan lime cements in their properties. Only granulated slag (i.e.
water-quenched, glassy slag) is effective as a cement component.
Super sulfated cements: These contain about 80% ground granulated blast
furnace slag, 15% gypsum or anhydrite and a little Portland clinker or lime as an
activator. They produce strength by formation of ettringite, with strength growth
similar to a slow Portland cement. They exhibit good resistance to aggressive
agents, including sulfate.
Calcium aluminate cements: are hydraulic cements made primarily from
limestone and bauxite. The active ingredients are monocalcium aluminates CaAl 2O4
(CaO Al2O3 or CA in Cement chemist notation, CCN) and mayenite Ca12Al14O33 (12
CaO 7 Al2O3 , or C12A7 in CCN). Strength forms by hydration to calcium aluminate
hydrates. They are well-adapted for use in refractory (high-temperature resistant)
concretes, e.g. for furnace linings.
Calcium sulfoaluminate cements: are made from clinkers that include ye'elimite
(Ca4(AlO2)6SO4 or C4A3
in Cement chemist's notation) as a primary phase. They are
used in expansive cements, in ultra-high early strength cements, and in "lowenergy" cements. Hydration produces ettringite, and specialized physical properties
(such as expansion or rapid reaction) are obtained by adjustment of the availability
of calcium and sulfate ions. Their use as a low-energy alternative to Portland
cement has been pioneered in China, where several million tonnes per year are
produced. Energy requirements are lower because of the lower kiln temperatures
required for reaction, and the lower amount of limestone (which must be
endothermic ally decarbonated) in the mix. In addition, the lower limestone content
and lower fuel consumption leads to a CO 2 emission around half that associated
with Portland clinker. However, SO2 emissions are usually significantly higher.
"Natural" Cements: correspond to certain cements of the pre-Portland era,
produced by burning argillaceous lime stones at moderate temperatures. The level
of clay components in the limestone (around 30-35%) is such that large amounts of
belite (the low-early strength, high-late strength mineral in Portland cement) are
formed without the formation of excessive amounts of free lime. As with any natural
material, such cements have highly variable properties.
Geopolymer cements: are made from mixtures of water-soluble alkali metal
silicates and aluminosilicate mineral powders such as fly ash and metakaolin.
COMPANY PROFILE
ULTRATECH CEMENT:
UltraTech Cement Limited has an annual capacity of 18.2 million tonnes. It

manufactures and markets Ordinary Portland Cement, Portland Blast Furnace Slag
Cement and Portland Pozzalana Cement. It also manufactures ready mix concrete
(RMC).
UltraTech Cement Limited has five integrated plants, six grinding units and three
terminals two in India and one in Sri Lanka.
UltraTech Cement is the countrys largest exporter of cement clinker. The export
markets span countries around the Indian Ocean, Africa, Europe and the Middle
East.
UltraTechs subsidiaries are Dakshin Cement Limited and UltraTech Ceylinco (P)
Limited.
The roots of the Aditya Birla Group date back to the 19th century in the picturesque
town of Pilani set amidst the Rajasthan desert. It was here that Seth Shiva Narayan
Birla started trading in cotton, laying the foundation for the House of Birlas.
Through India's arduous times of the 1850s, the Birla business expanded rapidly. In
the early part of the 20th century, our Group's founding father, Ghanshyamdas
Birla, set up industries in critical sectors such as textiles and fibre, aluminium,
cement and chemicals. As a close confidante of Mahatma Gandhi, he played an
active role in the Indian freedom struggle. He represented India at the first and
second round-table conference in London, along with Gandhi. It was at "Birla House"
in Delhi that the luminaries of the Indian freedom struggle often met to plot the
downfall of the British Raj.
Ghanshyamdas Birla found no contradiction in pursuing business goals with the
dedication of a saint, emerging as one of the foremost industrialists of preindependence India. The principles by which he lived were soaked up by his
grandson, Aditya Vikram Birla, our Group's legendary leader.
Aditya Vikram Birla: putting India on the world map

A formidable force in Indian industry, Mr. Aditya Birla dared to dream of setting up a
global business empire at the age of 24. He was the first to put Indian business on
the world map, as far back as 1969, long before globalization became a buzzword in
India.
In the then vibrant and free market South East Asian countries, he ventured to set
up world-class production bases. He had foreseen the winds of change and staked
the future of his business on a competitive, free market driven economy order. He
put Indian business on the globe, 22 years before economic liberalization was
formally introduced by the former Prime Minister, Mr. Narasimha Rao and the former
Union Finance Minister, Dr. Manmohan Singh. He set up 19 companies outside India,
in Thailand, Malaysia, Indonesia, the Philippines and Egypt.
Interestingly, for Mr. Aditya Birla, globalization meant more than just geographic
reach. He believed that a business could be global even whilst being based in India.
Therefore, back in his home-territory, he drove single-mindedly to put together the
building blocks to make our Indian business a global force.
Under his stewardship, his companies rose to be the world's largest producer of
viscose staple fiber, the largest refiner of palm oil, the third largest producer of
insulators and the sixth largest producer of carbon black. In India, they attained the
status of the largest single producer of viscose filament yarn, apart from being a
producer of cement, grey cement and rayon grade pulp. The Group is also the
largest producer of aluminium in the private sector, the lowest first cost producers
in the world and the only producer of linen in the textile industry in India.
At the time of his untimely demise, the Group's revenues crossed Rs.8,000 crore
globally, with assets of over Rs.9,000 core, comprising of 55 benchmark quality
plants, an employee strength of 75,000 and a shareholder community of 600,000.
Most importantly, his companies earned respect and admiration of the people, as
one of India's finest business houses, and the first Indian International Group
globally. Through this outstanding record of enterprise, he helped create enormous
wealth for the nation, and respect for Indian entrepreneurship in South East Asia. In
his time, his success was unmatched by any other industrialist in India.
That India attains respectable rank among the developed nations was a dream he
forever cherished. He was proud of India and took equal pride in being an Indian.
Under the leadership of our Chairman, Mr. Kumar Mangalam Birla, the Group has
sustained and established a leadership position in its key businesses through
continuous value-creation. Spearheaded by Grasim, Hindalco, Aditya Birla Nuvo,
Indo Gulf Fertilizers and companies in Thailand, Malaysia, Indonesia, the Philippines
and Egypt, the Aditya Birla Group is a leader in a swathe of products viscose
staple fibre, aluminium, cement, copper, carbon black, palm oil, insulators,
garments. And with successful forays into financial services, telecom, software and
BPO, the Group is today one of Asia's most diversified business groups.
Board of Directors:
::
Mr. Kumar Mangalam Birla, Chairman
::
Mrs. Rajashree Birla
::
Mr. R. C. Bhargava
::
Mr. G. M. Dave
::
Mr. N. J. Jhaveri
::
Mr. S. B. Mathur
::
Mr. V. T. Moorthy
::
Mr. O. P. Puranmalka
::
Mr. S. Rajgopal
::
Mr. D. D. Rathi
::
Mr. S. Misra, Managing Director
Executive President & Chief Financial Officer:

::
Mr. K. C. Birla
Chief Manufacturing Officer :

::
R.K. Shah
Chief Marketing Officer :

::
Company Secretary :
::
Mr. S. K. Chatterjee
Ourvision
To actively contribute to the social and economic development of the
communities in which we operate. In so doing, build a better, sustainable
way of life for the weaker sections of society and raise the country's
human development index."
Mrs. Rajashree Birla, Chairperson,
The Aditya Birla Centre for Community Initiatives and Rural Development
Awards won
Year
2013-2014
2012-2013
2011-2012
:
Award
IMC Ramakrishna Bajaj National Quality Award
Associated with Government projects & Business World FICCI-SEDF

CSR Award
ASSOCHAM CSR Excellence Award for its "truly outstanding" CSR
activities
2010-2011
Subh Karan Sarawagi Environment Award
2010-2011
Business World FICCI-SEDF CSR Award
2010
Genentech Environment Excellence Gold Award
2010
2010
Asian CSR Award
2009-2010
National Award for Prevention of Pollution
2009-2010
Rajiv Gandhi Environment Award for Clean Technology
2009-2010
State Level Environment Award (Plant)
Making a difference
Before Corporate Social Responsibility found a place in corporate lexion, it was
already textured into our Group's value systems. As early as the 1940s, our
founding father Shri G.D Birla espoused the trusteeship concept of management.
Simply stated, this entails that the wealth that one generates and holds is to be
held as in a trust for our multiple stakeholders. With regard to CSR, this means
investing part of our profits beyond business, for the larger good of society.
While carrying forward this philosophy, his grandson, Aditya Birla weaved in the
concept of 'sustainable livelihood', which transcended cheque book philanthropy. In
his view, it was unwise to keep on giving endlessly. Instead, he felt that channelising
resources to ensure that people have the wherewithal to make both ends meet
would be more productive. He would say, "Give a hungry man fish for a day, he will
eat it and the next day, he would be hungry again. Instead if you taught him how to
fish, he would be able to feed himself and his family for a lifetime."
Our strategy:
Our projects are carried out under the aegis of the "Aditya Birla Centre for
Community Initiatives and Rural Development", led by Mrs. Rajashree Birla. The
Centre provides the strategic direction, and the thrust areas for our work ensuring
performance management as well.
Our focus areas:

Our rural development activities span five key areas and our single-minded goal
here is to help build model villages that can stand on their own feet. Our focus areas
are healthcare, education, sustainable livelihood, infrastructure and espousing
social causes.
The name Aditya Birla evokes all that is positive in business and in life. It
exemplifies integrity, quality, performance, perfection and
above all character.
Our logo is the symbolic reflection of these traits. It is the cornerstone of our
corporate identity. It helps us leverage the unique Aditya Birla brand and endows us
with a distinctive visual image.
Depicted in vibrant, earthy colors, it is very arresting and shows the sun rising over
two circles. An inner circle symbolizing the internal universe of the Aditya Birla
Group, an outer circle symbolizing the external universe, and a dynamic meeting of
rays converging and diverging between the two.
Through its wide usage, we create a consistent, impact-oriented Group image. This
undoubtedly enhances our profile among our internal and external stakeholders.
Our corporate logo thus serves as an umbrella for our Group. It signals the common
values and beliefs that guide our behavior in all our entrepreneurial activities. It
embeds a sense of pride, unity and belonging in all of our 130,000 colleagues
spanning 25 countries and 30 nationalities across the globe. Our logo is our best
calling card that opens the gateway to the world.
Group companies:
::
Grasim Industries Ltd.
:: Hindalco Industries Ltd.

:: Aditya Birla Nuvo Ltd.
:: UltraTech Cement Ltd.
Indian companies:
::
Aditya Birla Minacs IT Services Ltd.
:: Aditya Birla Minacs Worldwide Limited

:: Essel Mining & Industries Ltd
:: Idea Cellular Ltd.
:: Aditya Birla Insulators
:: Aditya Birla Retail Limited
::
Aditya
Birla
Chemicals
(India) Limited
International companies:
Thailand:
::
Thai Rayon
:: Indo Thai Synthetics

:: Thai Acrylic Fiber
:: Thai Carbon Black
:: Aditya Birla Chemicals (Thailand) Ltd.
Philippines:
::
Indo Phil Group of companies
:: Pan Century Surfactants Inc.

Indonesia:
::
PT Indo Bharat Rayon
:: PT Elegant Textile Industry

:: PT Sunrise Bumi Textiles
:: PT Indo Liberty Textiles

:: PT Indo Raya Kimia
Egypt:
::
Alexandria Carbon Black Company S.A.E
:: Alexandria Fiber Company S.A.E

China:
::
Liaoning Birla Carbon
:: Birla Jingwei Fibres Company Limited

:: Aditya Birla Grasun Chemicals (Fangchenggang) Ltd.
Canada:
::
A.V. Group
Australia:
::
Aditya Birla Minerals Ltd.
Laos:
::
Birla Laos Pulp & Plantations Company Limited
North and South America, Europe and Asia:

::
Novelis Inc.
Singapore:
::
Swiss Singapore Overseas Enterprises Ptv. Ltd. (SSOE)
Joint ventures:
::
Birla Sun Life Insurance Company
:: Birla Sun Life Asset Management Company

:: Aditya Birla Money Mart Limited
:: Tanfac Industries Limited
UltraTech is India's largest exporter of cement clinker. The company's production

facilities are spread across eleven integrated plants, one white cement plant, one
clinkerisation plant in UAE, fifteen grinding units, and five terminals four in India
and one in Sri Lanka. Most of the plants have ISO 9001, ISO 14001 and OHSAS
18001 certification. In addition, two plants have received ISO 27001 certification
and four have received SA 8000 certification. The process is currently underway for
the remaining plants. The company exports over 2.5 million tonnes per annum,
which is about 30 per cent of the country's total exports. The export market
comprises of countries around the Indian Ocean, Africa, Europe and the Middle East.
Export is a thrust area in the company's strategy for growth.
UltraTech's products include Ordinary Portland cement, Portland Pozzolana cement
and Portland blast furnace slag cement.
Ordinary Portland cement
Portland blast furnace slag cement
Portland Pozzolan cement
Cement to European and Sri Lankan norms
Ordinary Portland cement:

Ordinary Portland cement is the most commonly used cement for a wide range of
applications. These applications cover dry-lean mixes, general-purpose ready-mixes,
and even high strength pre-cast and pre-stressed concrete.
Portland blast furnace slag cement:

Portland blast-furnace slag cement contains up to 70 per cent of finely ground,
granulated blast-furnace slag, a nonmetallic product consisting essentially of
silicates and alumino-silicates of calcium. Slag brings with it the advantage of the
energy invested in the slag making. Grinding slag for cement replacement takes
only 25 per cent of the energy needed to manufacture Portland cement. Using slag
cement to replace a portion of Portland cement in a concrete mixture is a useful
method to make concrete better and more consistent. Portland blast-furnace slag
cement has a lighter colour, better concrete workability, easier finish ability, higher
compressive and flexural strength, lower permeability, improved resistance to
aggressive chemicals and more consistent plastic and hardened consistency.
Portland Pozzolana cement:

Portland pozzolana cement is ordinary portland cement blended with pozzolanic
materials (power-station fly ash, burnt clays, ash from burnt plant material or
silicious earths), either together or separately.
UltraTech takes its responsibility to conserve the environment very seriously, and its
eco-friendly approach is evident across all spheres of its operations. Its major thrust
has been to identify alternatives to achieve set objectives and thereby reduce its
carbon footprint. These are done through:
::
Waste management
::
Energy management
::
Water conservation
::
Biodiversity management
::
A forestation
::
Reduction in emissions
Our strategy:
Our vision:
"To actively contribute to the social and economic development of the
human
development
index."

Making a difference:
Before Corporate Social Responsibility found a place in corporate lexicon, it was
PRODUCT PROFILE:
ULTRA TECH CEMENTS manufactures and distributes its own main product
lines of cement .We aim to optimize production across all of our markets, providing
a complete solution for customer's needs at the lowest possible cost, an approach
we call strategic integration of activities.
Cement is made from a mixture of 80 percent limestone and 20 percent clay.
These are crushed and ground to provide the "raw meal, a pale, flour-like powder.
Heated to around 1450 C (2642 F) in rotating kilns, the meal undergoes
complex chemical changes and is transformed into clinker. Fine-grinding the clinker
together with a small quantity of gypsum produces cement. Adding other

constituents at this stage produces cements for specialized uses.
QUALITY:
Six strong benefits that make 43, 53 Grade, Super fine, Premium and
Shakti the ideal cement
Higher compressive strength.
Better soundness.
Lesser consumption of cement for M-20 Concrete Grade and above.
Faster de shuttering of formwork.
Reduced construction time with a superior and wide range of cement catering
to every conceivable building need, ULTRA TECH CEMENTS is a formidable
player in the cement market.
Here just a few reasons why ULTRA TECH CEMENTS chosen by millions of India.
Ideal raw material
Low lime and magnesia content and high proportion of silicates.
CHAPTER-III
LITERATURE REVIEW
Literature of cash management:

"One of the first things that successful businesses did during the recession was to look at their
borrowing and renegotiate the terms to something that, while it may be over more years and
ultimately more expensive, has lower payments now. Yes, adding more debt is probably a bad
idea for most businesses, but if refinancing existing debt allows you to stay in business, there's a
definite upside to doing it."
"Other businesses negotiated longer periods for making payments to suppliers, while at the same
time requiring faster payments from customers."
Another way that recession-surviving businesses management cash flow was to manage how
much inventory was being carried at any given time - inventory costs money, and inventory
which sits on your stock-room floor for weeks has an opportunity cost which can bankrupt your
business."
The least desirable expense control is always in human resources, but as orders reduced, many
manufacturing businesses laid off staff, instituted freezes or cuts to pay and benefits, reduced
investment in hiring and training."
Connor concludes, "On the other side of things, the making money flow inside, there were a few
tricks, too."
"Accounts receivable factoring has appeared on the radars of more small business operators in
the last two years, but the highlights are that you sell your invoices for between three and ten
percent less than the invoice amount. Now you're asking why any business would do that. The
answer is that for most businesses, 90 percent of an invoice now is better than 100 percent of an
invoice in ninety days. That's if the customer pays in full. Factoring allowed businesses to get
almost all of their invoices paid by a third party and focus on doing business and generating
leads rather than chasing payments. The third party chases the customer for payment."
Cash and Profit:

Cash flow and profit are not the same thing. Financial accounting is not focused on cash flow. It
is focused on net income or profit. Over the long term, profit and cash flow are approximately
the same but the crucial difference is timing.
Timing can be so important for a small business. For example, when you make a sale to a credit
customer, you recognize that sale immediately on your income statement. That's called accrual
accounting. However, you don't get the money immediately. On your cash budget and your
statement of cash flows, you don't show that credit transaction until you actually receive
payment.
You can see how the gap between profit and cash flow could be very large. If you have rapid
growth in credit sales, for example, profit could far exceed actual cash received. This sort of
situation makes smaller companies very vulnerable to running out of cash.
What is Liquidity?
You often hear the word liquidity used in combination with cash management. Liquidity is a
firm's ability to pay its short-term debt obligations. In other words, if the firm has adequate
liquidity, it can pay its current liabilities such as accounts payable. Usually, accounts payable are
debts you owe your suppliers.
There are methods you can use to measure your liquidity. Financial ratio analysis will help you
determine how liquid your firm is or how successful it will be in meeting its short-term debt
obligations. The current ratio will help you determine the ratio of your current assets to your
current liabilities. Current assets include cash, accounts receivable, inventory, and occasionally
other line items such as marketable securities. You need to have more current assets than current
liabilities on your balance sheet at all times.
Cash Budgets:
Most companies should prepare monthly cash budgets to keep track of their cash. In
fact, cash budgets should be done six to twelve months in advance to project cash
needs. The cash budget will capture the timing difference between the profit you
see on the income statement and the cash that is actually coming into the firm and
flowing out of the firm.
The purpose of the cash budget is not to set targets for cash but to anticipate
needs. If you prepare cash budgets 6 - 12 months in advance and your needs
change, then change your cash budgets. Keep them up to date because the cost of
running low on cash in a business is high. You should know that from your own
personal finances. Prepare your budgets conservatively.
How to Maximize Your Cash Flow:

Your goal, as the owner and manager of your company, is to squeeze all the cash
out of your balance sheet that you can. Not only do you want to get as much cash
out of your company as you can, you want to keep it out in case of a potential or
actual crisis.
Two of your current asset accounts are usually big drains on your cash. They are
inventory and accounts receivable. Inventory is the products you sell and accounts
receivable are your credit accounts or those the accounts that represent the credit
you extend to customers. The balances in both accounts need to be converted to
cash as soon as possible.
You can use financial ratio analysis to check out your position regarding inventory
and accounts receivables. Inventory turnover ratios can tell you if your inventory is
obsolete or if you are selling so fast you are stocking out. Accounts receivable
ratios, such as day's sales outstanding, can tell you how fast your credit customers
are cleaning up their accounts among other things. Once you determine the position
of your inventory and receivables, you can take the appropriate actions to adjust
the situations and have more cash coming in to your firm.
Keys to Good Cash Management:
The bottom line to good cash management is that, in a crisis, typical financial
statements become irrelevant and all that is important is surviving from a cash
point of view. In a cash crisis, such as a recession, a business owner's focus
becomes, by necessity, very short-term. Often, a cash crisis will instill good cash
management practices into business managers that carry over from that day
forward.
Managers have to understand how to prepare a monthly cash budget. Next, they
must understand sources and uses of cash like are stated on the Statement of Cash
Flows, one of three required financial statements. The feedback you get from these
financial statements is invaluable.
Investing:
Changes in equipment, assets or investments relate to
cash from investing. Usually cash changes from investing are a "cash out" item,
because cash is used to buy new equipment, buildings or short-term assets such as
marketable securities. However, when a company divests of an asset, the
transaction
is
considered
"cash
in
for calculating
cash
from
investing.
Financing:
Changes in debt, loans or dividends are accounted for in cash from financing.
Changes in cash from financing are "cash in" when capital is raised, and they're
"cash out" when dividends are paid. Thus, if a company issues a bond to the public,
the company receives cash financing; however, when interest is paid to
bondholders, the company is reducing its cash.
Cash
Statement
Flow Income Statement
1. It is disclosing the
reasons for change in
working capital i.e.,
where
from
the
working capital cash
has been applied.
1. The Statements
narrates the item of
cost and revenue to
arrive at the figures
of profit and loss
earned / incurred
during a particular
period of time.
2. Income Statement
helps the preparation
of
Cash
Flow
Statement in as much
as one source of cash
i.e.,
cash
from
operation is found
out from the income
statement
2.
Cash
Flow
Statement
doesnt
help preparation of
income statement
3. Cash raised are 3.
Expenses
are
matched with cash

used. No distinction
is made between
capital and revenue
items
matched with income

in order to find out
the
result
of
operation.
Only
revenue items are
considered
Difference between Cash Flow Statement and Position Statement
Cash Flow Statement Position Statement

1. It is a Statement changes in financial
position.
1. It is statement of financial position
2. It shows the amount

of changes during the
particular period of
time.
2. It present the amount of assets and

liabilities at a particular point of time
3. It doesnt analyze
the change in current
asset
and
current
liability.
3. It shows all the accounting liabilities

whether current or non-current
4. It is a analytical
statement
analyzing
form where they have
been used, hence more
useful.
4. It is not a analytical statement hence

not that much useful for decision
making as the cash flow statement
Importance of cash flow statement:

The information which is provided by cash flow statement is neither available
in the balance sheet nor in the income statement and hence its important.
The
changes which have taken place in between two accounting dates are highlighted
by cash flow statement.
A lay man cannot grasp the underlying significance of
achievements and progress of the company simply by a personal of the balance

sheet and income statement of different years.
The comparative and analytical
study presented by the statement giving the details of sources and uses of cash
during a given period of immense help to the users of information. It is very useful
tool in analytical kit of the management also, besides the outsiders, in order to have
at a glance appraisal of the financial and operating performance of a company.
Uses of cash flow statement:

Cash flow statement of a company is of great value to management share
holders, creditors, bankers, money lending institutions etc.,
Informative value:- The financial consequence of business operation are

clearly explained in details by a cash flow statement some of the problems
which crop up in the minds of investors are well solved by a simple perusal of
this statement for e.g.,
1. Where have the profit gone.
2. Why does an imbalance exist between liquidity position and profitability
position of enterprise
Forecasting value:- A projected cash flow statement can be prepared and resources can
be properly allocated after an analysis of the present state of affairs. The optimal
utilization of available cash in necessary for the overall growth of the enterprise.
Testing value:- Whether the working capital has been effectively is used or not by the
management can well be tested by cash flow statement. Whether working capital has
been maintained at proper level, and whether it is adequate or inadequate can be known
by a study of the statement. The management is warned against the injudicious uses of
cash.
Decision-making value:-
Since over all credit worthiness of the enterprise is
known, creditors and money lenders can decide as to whether they have to provide
loans to company or not. The sources of raising cash and their application help the
shareholders to decide whether the management of the business is an enlightened or
not regarding managing cash.
Mismanagement of cash may be prevented.
The
management can be decide about the future financing policies and capital
expenditure programmers.
Statement of Change in working Capital

Particular
Previous
Year
Current Year
Increase
urrent assets:
nventories:
Change In Working
Capital
******
******
aw material
******
******
onsumable stores
******
******
Decreas
e
nished goods
******
******
undry debtors
******
******
ash in hand
******
******
alance with bank
******
******
******
******
******
******
******
******
ales tax
******
******
otal current assets
******
******
urrent liabilities
******
******
rade creditors
******
******
ealers deposits
******
******
xpenses payable
******
******
otal Current liabilities
******
******
******
******
ssets-current liabilities)
******
******
******
******
et Increase/decrease working capital
******
******
******
******
Other current assets:
eposits
ncome tax (advance tax)
Working capital (current
Structure of the Cash Flow Statement

The most commonly used format for the cash flow statement is broken down into
three sections: cash flows from operating activities, cash flows from investing
activities, and cash flows from financing activities.
Cash flows from operating activities are related to your principal line of business
and include the following:
Cash receipts from sales or for the performance of services
Payroll and other payments to employees
Payments to suppliers and contractors
Rent payments
Payments for utilities
Tax payments
Investing activities include capital expenditures disbursements that are not

charged to expense but rather are capitalized as assets on the balance sheet.
Investing activities also include investments (other than cash equivalents as
indicated below) that are not part of your normal line of business. These cash flows
could include:
Purchases of property, plant and equipment
Proceeds from the sale of property, plant and equipment
Purchases of stock or other securities (other than cash equivalents)
Proceeds from the sale or redemption of investments
Financing activities include cash flows relating to the businesss debt or equity
financing:
Proceeds from loans, notes, and other debt instruments
Installment payments on loans or other repayment of debts
Cash received from the issuance of stock or equity in the business
Dividend payments, purchases of treasury stock, or returns of capital
Direct Method:
Under the direct method, you are basically analyzing your cash and bank accounts
to identify cash flows during the period. You could use a detailed general ledger
report showing all the entries to the cash and bank accounts, or you could use the
cash receipts and disbursements journals. You would then determine the offsetting
entry for each cash entry in order to determine where each cash movement should
be reported on the cash flow statement.
Cash receipts from customers:
Net sales per the income statement
Plus beginning balance in accounts receivable
Minus ending balance in accounts receivable
Equals cash receipts from customers
Cash payments for inventory:
Ending inventory
Minus beginning inventory
Plus beginning balance in accounts payable to vendors
Minus ending balance in accounts payable to vendors
Equals cash payments for inventory
Cash paid to employees:
Salaries and wages per the income statement
Plus beginning balance in salaries and wages payable
Minus ending balance in salaries and wages payable
Equals cash paid to employees
Cash paid for operating expenses:
Operating expenses per the income statement
Minus depreciation expenses
Plus increase or minus decrease in prepaid expenses
Plus decrease or minus increase in accrued expenses
Equals cash paid for operating expenses
Taxes paid:
Tax expense per the income statement
Plus beginning balance in taxes payable
Minus ending balance in taxes payable
Equals taxes paid
Interest paid:
Interest expense per the income statement
Plus beginning balance in interest payable
Minus ending balance in interest payable
Equals interest paid
Under the direct method, for this example, you would then report the following in
the cash flows from operating activities section of the cash flow statement:
Cash receipts from customers
Cash payments for inventory
Cash paid to employees
Cash paid for operating expenses
Taxes paid
Interest paid
Equals net cash provided by (used in) operating activities
Indirect Method:
In preparing the cash flows from operating activities section under the indirect
method, you start with net income per the income statement, reverse out entries to
income and expense accounts that do not involve a cash movement, and show the
change in net working capital. Entries that affect net income but do not represent
cash flows could include income you have earned but not yet received, amortization
of prepaid expenses, accrued expenses, and depreciation or amortization. Under
this method you are basically analyzing your income and expense accounts, and
working capital. The following is an example of how the indirect method would be
presented on the cash flow statement:
Net income per the income statement
Minus entries to income accounts that do not represent cash flows
Plus entries to expense accounts that do not represent cash flows
Equals cash flows before movements in working capital
Plus or minus the change in working capital, as follows:

o
An increase in current assets (excluding cash and cash equivalents)

would be shown as a negative figure because cash was spent or
converted into other current assets, thereby reducing the cash balance.
A decrease in current assets would be shown as a positive figure,

because other current assets were converted into cash.
An increase in current liabilities (excluding short-term debt which would

be reported in the financing activities section) would be shown as a
positive figure since more liabilities mean that less cash was spent.
A decrease in current liabilities would be shown as a negative figure,

because cash was spent in order to reduce liabilities.
The net effect of the above would then be reported as cash provided by (used in)
operating activities.
The cash flows from investing activities and financing activities would be presented
the same way as under the direct method.
CHAPTER-IV
DATA ANALYSIS AND INTERPRETATION
Statements showing the change in working capital for

2012-2013:
Particles
Mar '14
Mar '13
2,368.36
2350.47
Sundry Debtors
1,281.02
1017.24
Cash and Bank Balance
277.5
142.66
Fixed deposits
3,926.88
11.71
Inventories
Loans and Advances
2,521.99
2161.94
Total CA, Loans & Advances
6448.87
5672.31
6810.76
6642.06
Provisions
972.96
1069.2
Total CL & Provisions
7783.72
7711.26
Net Working capital
-1334.85
-2038.95
Net increase\Decrease in
working capital
-704.1
Current Liabilities
10,000.00
8,000.00
6,000.00
4,000.00
Mar '14
2,000.00
Mar '13
ca
pi
ta
l
et
W
or
ki
ng
N
its
Cu
rre
nt
Li
ab
ilit
ie
s
-4,000.00
de
po
s
-2,000.00
Fix
ed
In
ve
nt
or
ie
s
0.00
Calculation of operating profit for the period (2013-2014):
Amount Cr
2014
Amount Cr 2013
Net Profit
2144.47
2653.43
Add Depreciation
1052.26
945.37
Gross Cash generation
3196.73
3600.8
631.04
1169.97
2565.69
2430.83
Particular
Less :- taxation For the year

Net Cash generation
STATEMENT OF SOURCES AND APPLICATION OF CASH

For the period (2013-14)
Source
Rs
Appal action
Rs
Secured loan
2398.35
Increase in gross Block
3684.15
Unsecured loan
2483.43
Secured loan Paid
2179.23
Cash From
operation
277.5
5159.28
Interpretation:
Net Increase in working

capital
-704.1
5159.28
From the above table it is observed that the net working capital of the company
shows increasing trend. The current assets of the company have increased from
Rs.5672.31 to Rs.6448.87 in 2013-2014. The current liability of the company showing
increasing trend from Rs.69cr in 2013-2014. The net capital company stood at
Rs.17097.51 in 2013-2014. And it is increased to. The decreasing working capital is
recorded as Rs.704.10.
It is evident from the above table that the total cash flow during the period from
2013-2014. Amount Rs.277.50. In the total cash flow 34.51% was received from cash
from operation, 38.94% received from secured loans and 23.67% was received from
unsecured loans.
Regarding the application of cash 2.58% used for repayment of secured loans
and 81.17% used for purchase of fixed assets and cash used for working capital
constitution 55.68% respectively.
Conclusion:
It is concluded that during the period 2013-14 48.98 % secured loans, 51.27%
unsecured loans, 30.08% cash for operation. Increasing gross block 61.27%, 39.67%
net decreasing working capital, 15.68%.
Statements showing the change in working capital for 2012-2013
Particles
Mar '13
Mar '12
Inventories
2350.47
2035.94
Sundry Debtors
1017.24
765.96
142.66
176.48
Fixed deposits
11.71
11.71
Loans and Advances
2161.94
1511.73
5672.31
4501.82
6642.06
5599.74
Provisions
1069.20
820.74
7711.26
6420.48
Net Working capital
-2038.95
-1918.66
Net increase\Decrease in working capital
-120.29
Current Liabilities
10000
8000
6000
4000
Mar '13
2000
Mar '12
ca
pi
ta
l
et
W
or
ki
ng
N
its
Cu
rre
nt
Li
ab
ilit
ie
s
-4000
de
po
s
-2000
Fix
ed
In
ve
nt
or
ie
s
Calculation of operating profit for the period

(2012-2013)
Particulars
Net profit
Add: depreciation
Gross cash generated

3348.75
Amount
Amount
(Cr)
(Cr)
2012
2012
2655.43
2446.19
945.37
902.56
3600.80
Less: taxation for the year
116.97
Net cash generated
3483.83
----
3348.75

Sources
Applications
Rs
Rs
Secured loans
2357.41
2147.34
Unsecured loans
2127.64
Cash from operation

-120.29
Increase in Gross Block
2315.34
142.66
Net
Working Capital
4605.34
4605.34
Interpretation:
Secured loans paid
increase
in
increasing trend from Rs.49crs in 2012-2013. The net capital company stood at
Rs.274318 in 2012-2013. And it is increased to. The decreasing working capital is
2012-2013. Amount Rs.4501.82. In the total cash flow 27.65% was received from
cash from operation, 33.56% received from secured loans and 38.8% was received
from unsecured loans.
Conclusion:
Particles
Mar '12
Mar '11
Inventories
2035.94
1,956.52
Sundry Debtors
765.96
602.29
176.48
144.79
Fixed deposits
11.71
0.32
Loans and Advances
1511.73
1,055.10
4501.82
3920.31
5599.74
4772.07
Provisions
820.74
573.49
6420.48
5345.56
Net Working capital
-1918.66
-1,425.25
-493.41
Current Liabilities
7000
6000
5000
4000
3000
2000
Mar '12
1000
Mar '11
its
ca
pi
ta
l
et
W
or
ki
ng
-3000
de
po
s
-2000
Fix
ed
In
ve
nt
or
ie
s
-1000
Cu
rre
nt
Li
ab
ilit
ie
s

(2011-2012)
Particulars
Net profit
Add: depreciation
Amount
Amount
(Cr)
(Cr)
2012
2011
2446.19
1404.23
902.56
3348.75
Net cash generated
765.73
2169.96
----
3348.75
2169.96

Sources
Applications
Rs
Rs
Secured loans
1072.21
Unsecured loans
3405.81
Cash from operation
2012.09
1769.04
176.48
Secured loans paid
Net increase in
Working Capital
3984.61
3984.61
Interpretation:
-493.41
decreasing trend from Rs.493.41 in 2011-2012. The net capital company stood at
Rs.6420.48 in 2011-2012. And it is increased to. The increasing working capital is
Conclusion:
It is concluded that during the period 2011-12 39.67% secured loans, 38.83%
net increasing working capital, 1.12% secured loans paid.
Particles
Mar '11
Mar '10
Inventories
1,956.52
821.70
Sundry Debtors
602.29
215.83
144.79
83.73
Fixed deposits
0.32
0.00
Loans and Advances
1,055.10
374.92
3920.31
1496.18
Current Liabilities
4772.07
1992.60
Provisions
573.49
161.01
5345.56
2,153.61
Net Working capital
-1,425.25
-657.43
-767.82
6,000.00
5,000.00
4,000.00
3,000.00
2,000.00
Mar '11
1,000.00
Mar '10
its
Cu
rre
nt
Li
ab
ilit
ie
s
N
et
W
or
ki
ng
ca
pi
ta
l
-2,000.00
de
po
s
-1,000.00
Fix
ed
In
ve
nt
or
ie
s
0.00

(2010-2011)
Particulars
Net profit
Add: depreciation
Amount
Amount
(Cr)
(Cr)
2011
2010
1404.23
765.73
2169.96
1093.24
388.08
1481.32
----
Net cash generated
2169.96
1481.32

Sources
Applications
Rs
Rs
Secured loans
9846.13
9846.13
Unsecured loans
-4789.24
2789.76
1354.84
Secured loans paid
Cash from operation
144.47
Net increase in
Working Capital
-767.82
4289.07
4289.07
Interpretation:
Conclusion:
Particles
Mar '10
Mar '09
Inventories
821.70
691.97
Sundry Debtors
215.83
186.18
83.73
104.49
Fixed deposits
0.00
0.00
Loans and Advances
374.92
395.71
1,496.18
1,378.35
Current Liabilities
1,992.60
1,860.59
Provisions
161.01
121.80
2,153.61
1,982.39
-657.43
-604.04
Net Working capital

-53.44
2500
2000
1500
1000
500
0
Mar '10
-1000
Mar '09
Ca
sh
In
ve
nt
or
an
ie
s
d
Ba
nk
Ba
la
Lo
nc
an
e
s
an
d
Ad
va
nc
es
Cu
rre
nt
N
Li
et
ab
in
T
ilit
ot
cr
ie
al
ea
s
CL
se
\D
&
ec
Pr
re
ov
as
is
io
e
ns
in
wo
rk
in
g
ca
pi
ta
l
-500
Calculation of operating profit For the period (200910)
Particulars
Amount
(Cr)
(Cr)
2010
Net profit
Add: depreciation
Amount
2009
1093.24
388.08
977.02
323.00
1481.32
1300.02
----
Net cash generated

1300.02
1481.32
FOR THE PERIOD (2009-2010)
Sources
Rs
Applications
Secured Loans
854.19
Sales Unsecured Loans
Unsecured loan
750.33
Gross Block
Cash From
operation
83.73
1688.25
Increasing in Working
Capital
Rs
677.12
1064.57
-53.44
1688.25
INTERPRETATION:
From the above table it is observed that the net working capital of the
company shows increased From Rs. -83.96 to Rs. -53.44 in 2009-.10
The net working capital of the company Rs. 83.96 in 2009-2010. And it is
increased . The increasing Working capital is recorded as Rs. 657.43.
It is evident from the above table the total cash flow during the period from
2009-10. Amount Rs 83.73. In the total cash flow 53.40% was received from cash
operation and 45.44% was received from unsecured loans (vehicles) and 1.15%
was received from secured loans.
Regarding the application of cash 3.99% used for repayment of unsecured
loans and 81.16% used for purchase of fixed assets and cash used for working
capital constitution 14.85% respective.
CONCLUSION:
It is concluded that during the period 2009-10 more than 53.4% of the cash
came trading activities 1.16% used in secured loans, 45 the application of cash
around 81.16% of the cash utilized for investing in fixed assets. And 3.99% used
for repayment of unsecured loans.
NET INCREASES IN WORKING CAPITAL:
YEAR
INCREASE / DECREASE
AMOUNT
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
INCREASE
DECREASE
INCREASE
DECREASE
DECREASE
-53.44
-767.82
-493.41
-120.29
-704.10
AMOUNT
0
-100
-200
AMOUNT
-300
-400
-500
-600
-700
-800
-900
The above table observed that the working capital Increased. In year 2009 14
the working capital has been increased. In the year 2013-14 the working capital is Rs704.10 Due to the increase in current liabilities the net working capital is increased.
Changes in cash from operations
YEAR
AMOUNT
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
1571.93
2074.26
3443.40
3825.40
2775.51
AMOUNT
4500
4000
3500
3000
2500
2000
1500
1000
500
0
20
14
20
13
-
20
13
20
12
-
20
12
20
11
-
20
11
20
10
-
20
09
-
20
10
AMOUNT
The above table explains that continuous

fluctuations in flow of cash from operation.
In the year 2009-10 the cash from operation is
increased .The cash from operation in the years
& it has increased. In the year 2013-14. The
cash from operation in the year 2013-14 is Rs.
2775.51.
USES & APPLICATION OF CASH
APPLICA
TION
2009-10
2010-11
2011-12
2012-13
2013-14
Increase
in
Gross
Block
677.12
9846.13
1072.21
2357.41
3684.15
----
3405.81
2127.64
2179.23
1356.84
1796.04
2315.34
2483.43
Secured
loans paid
1064.57
Unsecure
d loans
750.33
4000
3500
3000
APPLICATION
2500
2009-10
2011-12
2000
2012-13
1500
2013-14
1000
500
0
1
The above table shows that Gross block has increased to Rs. 3684.15 in 2013-14 &
Rs. 1072.21 in 2012-2013. The secured loans paid Rs.2179.23 in 201314
&Rs.2127.64 in 2009-10. The unsecured loans paid Rs.2483.43 in the year2013-14.
CHAPTER-V
FINDINGS
SUGGESSIONS
CONCLUSIONS
BIBLIOGRAPHY
FINDINGS:
During the period 2009-2010 to 2013-14 more than 58.59% of the cash
came from trading activities. In the application of the cash around
78.94% of the cash are utilized for investing in fixed assets.
came trading activities. In the application of the cash 29.27% of the
cash are utilized for investing in fixed assets.
cash are utilize for the investing in fixed assets.
During the period 2013-14 more than 48.64% of the cash came from
trading activities. In the application of cash around 86% utilized for
investing in fixed assets.
During the period 2013-14 more than 75.34 % of the cash came from
trading activities. The application of cash around 74.88 % of the cash
was utilized for investing in fixed assets.
CONCLUSIONS:
Regarding the long-term funds to fixed assets they show an increase.

1. Regarding the total investment turnover ratio it is observed sales had an
increase from 2010-14.
2.
Regarding the Fixed Asset turnover ratio, sales had an increased.
3. From the above study it can be said that the UltraTech Cement Limited
overall financial position on fixed assets is satisfactory.
4. The UltraTech Cement Limited Net Profit is showing negative profit in the year 200910. This event is an expected one because since from the previous two years it is showing
the decline stage in Net Profit.
5. Profit Margin of UltraTech Cement Limited is decreasing and showing negative profit
because there is increase in the price.
6. The UltraTech Cement Limited Net Working Capital Ratio is satisfactory.
7. The UltraTech Cement Limited return on Total Assets shows a posigative sign in the
year 2009-10.
8. The Operating Ratio of UltraTech Cement Limited increase in the year 2009-10, in the
year 2009-10and reached in the year 2013-14 so the company has to reduce its operating
costs.
9. The Operating cash of UltraTech Cement Limited satisfactory. Due to increase in cost
of production, this ratio is decreasing. So the has to reduce its office administration
expenses
SUGGESTIONS:
1) For the improving the financial performance of the company the

following suggestions are made.
2) In order to reduce the outside borrowings in the company has to

acquire. The capital from equity sources. Keeping in view the debt
equity the proportion as normal.
3) The liquidity of the company should be improved by maintaining the
optimum current assets and liquid assets according to standard norms.
4) The quantum of the sales generated should be improved impressively
in order to attain higher return on investment.
5) To improve the financial health of the company and maximizing the
time between the source mobilization and utilization the management
must introduce the new cost saving techniques.
BIBLIOGRAPHY:
FINANCIAL MANAGEMENT
- I.M. Panday
- Prasanna Chandra
- M.Y. Khan & P.K. Jain
PRINCIPLES OF MANAGEMENT
- Man Mohan & Goyal S.N.
- Maheswari S.N.
Annual reports of ULTRATECH CEMENTS LIMITED-2013-14:
www.googlefinance.com
www.financeindia.com
www.cashflowstatement.com
www.ultratech.com
CHAPTER-I
INTRODUCTION
INTRODUCTION
Customer satisfaction:
The state in which customer needs, wants and expectations throughout the
product or service's life are met or exceeded resulting in repeat purchase, loyalty
and favorable worth-of mouth.
According to Jones and Sasser (1995), four basic elements affect customer
satisfaction.
A business term, is a measure of how products and services supplied by a company meet
or surpass customer expectation. It is seen as a key performance indicator within business and is
part of the four of a Balanced Score motors.
In a competitive marketplace where businesses compete for customers, customer
satisfaction is seen as a key differentiator and increasingly has become a key element of business
strategy.
There is a substantial body of empirical literature that establishes the benefits of customer
satisfaction for firms.
Automobile Industry:
Industry that produces
automobiles and other gasoline-powered vehicles,
such as buses, trucks, and motorcycles. The automobile industry is one of the most
important industries in the world, affecting not only the economy but also the
cultures of the world. It provides jobs for millions of people, generates billions of
dollars in worldwide revenues, and provides the basis for a multitude of related
service and support industries. Automobiles revolutionized transportation in the

20th century, changing forever the way people live, travel, and do business.
The automobile has enabled people to travel and transport goods farther and faster, and
has opened wider market areas for business and commerce. The auto industry has also reduced
the overall cost of transportation by using methods such as mass production (making several
products at once, rather than one at a time), mass marketing (selling products nationally rather
than locally), and globalization of production (assembling products with parts made worldwide).
From 1886 to 1898, about 300 automobiles were built, but there was no real established industry.
A century later, with automakers and auto buyers expanding globally, auto making became the
world's largest manufacturing activity, with nearly 58 million new vehicles built each year
worldwide.
As a result of easier and faster transportation, the United States and world economies
have become dependent on the mobility that automobiles, trucks, and buses provide. This
mobility allowed remote populations to interact with one another, which increased commerce.
The transportation of goods to consumers and consumers to goods has become an industry in
itself. The automobile has also brought related problems, such as air pollution, the emission of
greenhouse gases that contribute to global warming, congested traffic, and highway fatalities.
Nevertheless, the automobile industry continues to be an important source of employment and
transportation for millions of people worldwide.
Automobile India:
The history of the automobile industry in India actually began about 4,000
years ago when the first wheel was used for transportation. In the early 15th
century, the Portuguese arrived in China and the interaction of the two cultures led
to a variety of new technologies, including the creation of a wheel that turned under
its own power. By the 1600s, small steam-powered engine models were developed,
but it was another century before a full-sized engine-powered automobile was
created.
The dream a motors age that moved on its own was realized only in the 18th
century when the first motors rolled on the streets. Steam, petroleum gas,
electricity and petrol started to be used in these MOTORSs.
The automobile, as it progressed, was a product of many hands, of

revolutionary concepts, and of simple, almost unnoticed upgrading. India's transport
network is developing at a fast pace and the automobile industry is growing too.
The automobile industry also provides employment to a large section of the
population. Thus the role of automobile industry cannot be overlooked in Indian
Economy. All kinds of vehicles are produced by the automobile industry. It includes
the manufacture of trucks, buses, passenger motors, defense vehicles, twowheelers, etc. The industry can be broadly divided into the motors manufacturing,
two-wheeler manufacturing and heavy vehicle-manufacturing units.
NEED AND IMPORTANCE OF THE STUDY:

The Indian automobile industry is witnessing changes like never
before. The Indian consumer is changing with new players entering the market and
increasing availability of service, the consumer is demanding more. Now the
question is where TATA Motors stands in this scenario? TATA Motors is the only
company that maintenance good relationship with their customers and providing
good service, well as presenting the market with a range of motors by motors by
introducing different models, and to provide better after sales service to their
customers. TATA Motors has increased its service stations all over the country, and
thats why TATA Motors is ranked as No.1 in customer satisfaction. And to maintain
relationship with their customers TATA Motors is providing 24 hours service to their
customers after introducing May services, how fast the consumer is satisfying with
it, and to know after sales service of TATA motors owners opinion on the service
and the performance of the dealer.
OBJECTIVES OF STUDY:
To know the customer perception towards the service
To know the factors influencing the customers after sales service of the TATA
Motors (AUTOFIN LIMITED).
To know whether the customer is satisfied with dealer renders after sales
service, how fast the consumer is satisfied with it..
To know the customers reaction for the dealer performance on TATA Motors
(AUTOFIN LIMITED).
To know whether the customer problem is resolving completely at service

station.
To know whether the vehicle is delivering on time to the customers.
To know whether the TATA Motors (AUTOFIN LIMITED) given benefits to

the customer.
SCOPE OF THE STUDY:
The scope is very limited because attitude of the people change according to
the time.
The scope of project work is to get the opinions from respondents on the
issues mentioned earlier.
It is limited to the twin cities of Hyderabad and is confined to the urban areas
as the respondents are the subscribers of TATA Motors (AUTOFIN
LIMITED)is one form or the other.
RESEARCH METHODOLOGY:
Research is the plan structure & strategy for investigation conceived to
answer to research question & control variance. It is the overall operation pattern to
framework of project that stipulated the information to be collected from which
sources by word procedure. What are the two possible sources of data for securing
in the above mentioned information in the primary & secondary data.
Research design:
The study undertaken to access the after sales service of TATA owners in
Hyderabad and R.R.Dist.
Research procedure:
The questionnaire designed for the study in the structured & disguised in
nature. It consists of multiple choice & short questions.
Data:
Information required for the project is mainly primary data. The information
was collected by survey method. With the help of questionnaire by meeting various
motors owners (TATA).
Secondary data is collected form the company journals, magazines,

broachers & websites.
Sample design:
The sampling unit was confined to end consumers of the product i.e. TATA
motors owners to know there satisfaction level regarding performance of motors
performance of motors and service.
Sample universe:
The survey was done in Hyderabad and R.R.Dist only according to my
convenience. It is not giving the complete picture of Andhra Pradesh (or) India.
Sample frame/unit: professionals, business people, employees etc
Sample size:
The total sample size is 100 only.
Sample method:
The information is planned to be collected by sample method, the sample
method followed is random sampling method. The probability random sampling
method is stratified random sampling.
Analytical Method:
Simple percentage method is used for the analysis purpose.
Period of study:
Study is during the month of January & February 2015.
Data collection:
The information is collected through questionnaires and personal interviews.
And the information of customers is known by companys service sheet and the free
service sheet.
A Direct structure questionnaire has been asked to all the respondents in the
sample followed by direct personal interviews.
Descriptive Studies:
In descriptive studies, when the researcher is interested in knowing the
characteristics of certain groups such as age. Sex, educational level occupation of
income, a descriptive study is necessary. Descriptive studies are well structured. It
is therefore, necessary that the researcher gives sufficient thought to framing
research questions and deciding the types of data to he collected and the procedure
to be used for this purpose-The objective of such a study is to answer the who,
what and how of the subject under investigation.
SOURCES OF DATA:
A classification of data is very important procedure in this concept. The

collected data can be classified into two types.
1. primary data
2. secondary data
Primary data:
The primary data is very important source for to make suggestions to the title
obtained. This data can be collected in various methods like survey, interviewing,
feedback, i.e. Group Discussion etc., for collection of primary data the survey
method
is
used,
which
involved
predetermined
questions.
The
structured
questionnaire contained a form list of question framed so as to get the facts. But it
involves high risk and huge expensive method to get the facts.
Secondary Data:
Collection of secondary data is very easy compared with primary data. But
this data is also very important for the growth of an organization, to predict the
future and will help to make the future plan regarding sales and improve the
measures of sales.
This data can be collected from the magazines. Annual reports of the
organization and other published data.
Sample procedure:
The sample size consists of 100 consumers. The sample consists of
Businessman, Doctors, Engineers, Officers and Contractors etc.
The survey was conducted in the form of an interview among randomly

chosen sample of 100 consumers of TATA customers Sample size form the dealer
randomly.
The study is restricted to both Hyderabad and Ranga Reddy Dist and that to
among 100 respondents.
The study is conducted for 45 days.
The study is restricted to certain area. So it could not give an accurate picture
about Andhra Pradesh of India.
The Accuracy Of The Answers Depends Upon The Mode Of Interest Of

Respondents.
Though the customers wanted to give information they could not, as they
felt it takes away their business time.
The accuracy of the answers depends upon the mode of interest of

respondents.
The opinions of the sample may or may not depict the exact opinions of the
total population.
CHAPTER-II
INDUSTRY PROFILE &
COMPANY PROFILE
INDUSTRY PROFILE
Introduction:
The automobile industry is one of Indias most vibrant and growing industries.
This industry accounts for 22 per cent of the country's manufacturing gross
domestic product (GDP). The auto sector is one of the biggest job creators, both
directly and indirectly. It is estimated that every job created in an auto company
leads to three to five indirect ancillary jobs.
India's domestic market and its growth potential have been a big attraction for
many global automakers. India is presently the world's third largest exporter of twowheelers after China and Japan. According to a report by Standard Chartered Bank,
India is likely to overtake Thailand in global auto-export market share by the year
2020.
The next few years are projected to show solid but cautious growth due to improved
affordability, rising incomes and untapped markets. With the governments backing,
and trends in the international scenario such as the decline in prices of natural
rubber, the Indian automobile industry is slated to witness some major growth.
Market size:
The cumulative foreign direct investment (FDI) inflows into the Indian
automobile industry during the period April 2000 August 2014 was recorded at
US$ 10,119.68 million, as per data by Department of Industrial Policy and Promotion
(DIPP).
Data from industry body Society of Indian Automobile Manufacturers (SIAM)
showed that 137,873 passenger cars were sold in July 2014 compared to 131,257
units during the corresponding month of 2013. Among the auto makers, Maruti
Suzuki, Hyundai Motor India and Honda Cars India emerged the top three gainers
with sales growth of 15.45 per cent, 12 per cent and 11 per cent, respectively.
The three-wheeler segment posted a 24 per cent growth to 51,461 units on
the back of increased demands from the urban market. Total sales across different
vehicle segments grew 12 per cent year on year (y-o-y) to 1,586,123 units.
Scooter sales have jumped by 29 per cent in the ongoing fiscal, and now form
27 per cent of the total two-wheeler market from just 8 per cent a decade back. The
ever-rising demand for scooters, which has far outstripped supply has prompted
Honda to set up its first dedicated scooter plant in Ahmedabad.
Tractor sales in the country is expected to grow at a compound annual growth rate
(CAGR) of 89 per cent in the next five years making India a high-potential market
for many international brands.
Investments:
To match production with demand, many auto makers have started to invest
heavily in various segments in the industry in the last few months. Some of the
major investments and developments in the automobile sector in India are as
follows:
Ashok Leyland plans to invest Rs 450500 crore (US$ 73.5481.71 million) in

India, by way of capital expenditure (capex) and investment during FY15. The
company is required to manage Rs 6,000 crore (US$ 980.56 million) of assets
in seven locations across the world, for which maintenance capex is needed.
Honda Motors plans to set up the world's largest scooter plant in Gujarat to
roll out 1.2 million units annually and achieve leadership position in the
Indian two-wheeler market. The company plans to spend around Rs 1,100
crore (US$ 179.76 million) on the new plant in Ahmedabad, and expand its
range with a few more offerings.
Yamaha Motor Co has restructured its business in India. Now, Yamaha Motor
India (YMI) will take care of its India operations. The restructuring is part of
Yamahas mid-term plan aimed at improving organisational efficiency, as per

Mr Hiroyuki Suzuki, Chief Executive and Managing Director. YMI would be
responsible for corporate planning and strategy, business planning and
business expansion, quality control, and regional control of Yamaha India
Business.
Tata Motors plans to use the 'hub-and-spoke' model in which India will be the
key manufacturing base while it will have mini-hubs in overseas markets. The
company also plans to set up mini hubs in potential markets like Africa,
Middle-East and South East Asia.
The Government of India encourages foreign investment in the automobile
sector and allows 100 per cent FDI under the automatic route. To boost
manufacturing, the government had lowered excise duty on small cars,
motorcycles, scooters and commercial vehicles to eight per cent from 12 per cent,
on sports utility vehicles to 24 per cent from 30 per cent, on mid-segment cars to 20
per cent from 24 per cent and on large-segment cars to 24 per cent from 27 per
cent.
The governments decision to resolve VAT disputes has also resulted in the
top Indian auto makers namely, Volkswagen, Bajaj Auto, Mahindra & Mahindra and
Tata Motors announcing an investment of around Rs 11,500 crore (US$ 1.87 billion)
in Maharashtra.
The Automobile Mission Plan for the period 20062016, designed by the
government is aimed at accelerating and sustaining growth in this sector. Also, the
well-established Regulatory Framework under the Ministry of Shipping, Road
Transport and Highways, plays a part in providing a boost to this sector.
The Government of India-appointed SIAM and Automotive Components

Manufacturers Association (ACMA) are responsible in working for the development
of the Indian automobile industry.
Road Ahead:
The future of the auto industry depends on the positive sentiments and the
demand for vehicles in the market. With the festival season coming up, the Indian
auto sector will see a rise in demand which is expected to bring in major growth. An
auto dealer survey by firm UBS suggested that the Indian auto industry, riding on
trends like the upcoming festival season and decline in fuel price, will observe a 12
per cent y-o-y growth in FY15.
Also, keeping up with international trends, there is expected to be a surge in
the number of hybrid vehicles in the Indian auto sector in the years to come.
The growth story for the Indian automobile industry in 2014 rode on the twowheeler segment and not on passenger cars or commercial vehicles, as high
interest rates and a stuttering manufacturing industry kept a check on demand.
The year also saw Competition Commission of India (CCI) levying a penalty of
Rs.2,544.65 crore ($415) on 14 car makers for their restrictive trade practices by
preventing independent repairers coming into the market. Some of the leading car
makers also had to recall some models over defective components.
When other segments like passenger cars and commercial vehicles logged
negative growth, the two-wheeler makers registered around 13 percent growth
between January and October. Riding on the two-wheeler sector's growth, the
automotive industry grew 9.8 percent by volume year-on-year (YoY) between
January and October.
"The two-wheeler segment is the only one that has clocked positive growth at
12.9 percent YoY (year-on-year) to reach sales of nearly 13.5 million units by
October. This can be attributed to the low cost of two wheelers
In India," Vijay Kakade, vice president for automotive and transportation practice
at Frost & Sullivan, told IANS.
He said the light commercial vehicle (LCV) segment has been the worst hit,
with sales reducing to approximately 330,000 units -- an 18.9 percent YoY fall over
2013.
"The passenger car, medium and heavy commercial vehicle segments
contracted by 0.8 and 6.5 percent respectively during the period, compared to
2013. The reduction in sales can be attributed to the slowdown and the high interest
rates set by the RBI (Reserve Bank of India) reducing the availability of finance
options to the public," Kakade added.
"These segments have shown positive signs over the past few months, which is
expected to lead to growth in the next year."
"The year 2014 has been a year of stagnation, which is a positive sign as the
decline has stopped. The industry has shown signs of growth, albeit slower than
expected, over the past few months," Kakade remarked.
P. Balendran, vice president, General Motors India, had similar views to share with
IANS: "Of late, we have seen some movements in new entries driven by novelty
factors and some select manufacturers have been getting the benefits too."
He said the market has not shown any movement forward, despite the excise duty
reduction, while the customer sentiment has not picked up due to sticky interest
rates, which remain at high levels.
"Although fuel prices have started coming down significantly, the enquiry levels
at showrooms have come down and conversions are not taking place at all. The
sales of diesel vehicles are also tapering off because of the narrowing price gap visa-vis petrol," Balendran added.
Expecting the government to continue with a lower excise duty regime for
small/mid-sized/big cars and sports utility vehicles (SUV) till March 2015, Balendran
said the rates should be continued till the Goods and Services Tax ( GST) is
introduced -- aiding the turnaround of the auto sector.
Terming 2014 a mixed bag for the automobile industry, Sumit Sawhney, chief
executive and managing director of Renault India, told that while there has been a
sea change in the consumer sentiment with a gradually improving economic climate
in the country, the optimism has still to translate into sustained sales growth.
"The industry is looking forward to the budget for pro-business policies to
reignite the automobile industry in India."
Highlights of India's automobile industry 2014:

* Overall growth was 9.8 percent by volume year-on-year (YoY) between January and
October.
* Two-wheeler sector grew 12.9 percemt
* Passenger car, medium and heavy commercial vehicle segments contracted by
0.8 and 6.5 till October
* LCV segment worst hit, with sales falling 18.9 percent YoY fall over 2013 till
October
* Excise duty reduction on automobiles
* Competition Commission of India (CCI) fines 14 car-makers Rs.2,544.65 crore for
restrictive trade practices.
Auto manufacturers have been trying to cope with economical rough patch in
last two years. Trying to boost sales and implementing cost effective schemes just
wasnt enough. They also had to cut many of their employees loose to stay
somewhat balanced, in some cases. On a fashionable note, senior employees were
asked to take voluntary retirement (not sure what voluntary is doing in that
sentence).
Tata Motors apart from giving customers attractive offers, gave 600 of their
employees early retirement offers, last month. Ashok Leyland too offered 500 of
their employees with irresistible retirement schemes, last year (pun intended).
Sales of Cars, SUVs, Vans, pick-ups, and entire commercial vehicle segment
went south, with passenger vehicle market encountering first decline in the decade.
But what saved the overall scenario was the two-wheeler market. It took 7.31% hike
with motorcycle sales going 3.91% up and scooter sales riding 23% north. Export
sales figures also contributed to somewhat saving the year with rise of 7.21%.
The downtrend left auto manufacturers with piled up inventory and
stagnation. The interim budget announced in February, gave a minor boost as all
vehicles prices were reduced marginally, but it hasnt exactly helped boost sales
yet. Automakers are expecting aid from the governments new budget by way of
further tax cuts.
Sales figures of March 2014 shows 12.83% overall growth also by means of
increased two-wheeler sales. Commercial Vehicles have further dipped compared to
March 2013 and passenger cars stagnating below the graph. However, overall
production has increased by 9.95% comparing March figures of both years,
suggesting auto makers confidence in ongoing fiscal to make better.
Launch of new A segment compact cars by various auto majors seems to be
helpful in this economy, for customers as well as value chain entities. Maruti Suzuki
finished top on podium with 42% share in overall car sales, followed by Hyundai
with 15% share.
Society of Indian Automobile Manufacturers (SIAM) expects a 6% growth over

in the fiscal 2014-15, with boost in manufacturing sector, new investment and fresh
capacities in the industry. Vikram Kirloskar, president of SIAM says, Whichever
government comes inI am looking for stability in excise duty and some reduction
in taxes. We are an over-taxed industry.
COMPANY PROFILE
COMPANY PROFILE:
The Tata group comprises over 100 operating companies in seven business
sectors: communications and information technology, engineering, materials,
services, energy, consumer products and chemicals. The group has operations in
more than 100 countries across six continents, and its companies export products
and services to 150 countries.
Founded by Jamsetji Tata in 1868, the Tata group is a global enterprise
headquartered in India, and comprises over 100 operating companies, with
operations in more than 100 countries across six continents, exporting products and
services to over 150 countries. The revenue of Tata companies, taken together, was
$103.27 billion (around Rs624,757 crore) in 2013-14, with 67.2 percent of this
coming from businesses outside India. Tata companies employ over 581,000 people
worldwide.
Every Tata company or enterprise operates independently. Each of these
companies has its own board of directors and shareholders, to whom it is
answerable. There are 32 publicly listed Tata enterprises and they have a combined
market capitalisation of about $107.60 billion (as on January 30, 2014), and a
shareholder base of 3.9 million. The major Tata companies are Tata Steel, Tata
Motors, Tata Consultancy Services (TCS), Tata Power, Tata Chemicals, Tata Global
Beverages, Tata Teleservices, Titan, Tata Communications and Indian Hotels.
Tata Steel is among the top ten steelmakers, and Tata Motors is among the
top five commercial vehicle manufacturers, in the world. TCS is a leading global
software company, with delivery centres in the US, UK, Hungary, Brazil, Uruguay
and China, besides India. Tata Global Beverages is the second-largest player in tea
in the world. Tata Chemicals is the worlds second-largest manufacturer of soda ash
and Tata Communications is one of the worlds largest wholesale voice carriers.
In tandem with the increasing international footprint of Tata companies, the
Tata brand is also gaining international recognition. Brand Finance, a UK-based
consultancy firm, valued the Tata brand at $18.16 billion and ranked it 39th among
the top 500 most valuable global brands in their BrandFinance Global 500 2013
report. In 2010, BusinessWeek magazine ranked Tata 17th among the '50 Most
Innovative Companies' list.
Tata companies have always believed in returning wealth to the society they
serve. Two-thirds of the equity of Tata Sons, the Tata promoter holding company, is
held by philanthropic trusts that have created national institutions for science and
technology, medical research, social studies and the performing arts. The trusts also
provide aid and assistance to non-government organisations working in the areas of
education, healthcare and livelihoods. Tata companies also extend social welfare
activities to communities around their industrial units.
Going forward, Tata is focusing on new technologies and innovation to drive
its business in India and internationally. The Nano car is one example, as is the Eka
supercomputer (developed by another Tata company), which in 2008 was ranked
the worlds fourth fastest. Anchored in India and wedded to traditional values and
strong ethics, Tata companies are building multinational businesses that will achieve
growth through excellence and innovation, while balancing the interests of
shareholders, employees and civil society.
Tata Motors Limited is Indias largest automobile company, with consolidated
revenues of INR 2,32,834 crores (USD 38.9 billion) in 2013-14. It is the leader in
commercial vehicles in each segment, and among the top in passenger vehicles
with winning products in the compact, midsize car and utility vehicle segments.
The Tata Motors Groups over 60,000 employees are guided by the mission
to be passionate in anticipating and providing the best vehicles and experiences
that excite our customers globally.''
Established in 1945, Tata Motors presence cuts across the length and
breadth of India. Over 8 million Tata vehicles ply on Indian roads, since the first
rolled out in 1954. The companys manufacturing base in India is spread across
Jamshedpur (Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh), Pantnagar
(Uttarakhand), Sanand (Gujarat) and Dharwad (Karnataka). Following a strategic
alliance with Fiat in 2005, it has set up an industrial joint venture with Fiat Group
Automobiles at Ranjangaon (Maharashtra) to produce both Fiat and Tata cars and
Fiat powertrains. The companys dealership, sales, services and spare parts network
comprises over 6,600 touch points, across the world.
Tata Motors, also listed in the New York Stock Exchange (September 2004),
has emerged as an international automobile company. Through subsidiaries and
associate companies, Tata Motors has operations in the UK, South Korea, Thailand,
South Africa and Indonesia. Among them is Jaguar Land Rover, acquired in 2008. In
2004, it acquired the Daewoo Commercial Vehicles Company, South Korea's second
largest truck maker. The rechristened Tata Daewoo Commercial Vehicles Company
has launched several new products in the Korean market, while also exporting these
products to several international markets. Today two-thirds of heavy commercial
vehicle exports out of South Korea are from Tata Daewoo. In 2006, Tata Motors
formed a 51:49 joint venture with the Brazil-based, Marcopolo, a global leader in
body-building for buses and coaches to manufacture fully-built buses and coaches
for India - the plant is located in Dharwad. In 2006, Tata Motors entered into joint
venture with Thonburi Automotive Assembly Plant Company of Thailand to
manufacture and market the company's pickup vehicles in Thailand, and entered
the market in 2008. Tata Motors (SA) (Proprietary) Ltd., Tata Motors' joint venture
with Tata Africa Holding (Pty) Ltd. set up in 2011, has an assembly plant in Rosslyn,
north of Pretoria. The plant can assemble, semi knocked down (SKD) kits, light,
medium and heavy commercial vehicles ranging from 4 tonnes to 50 tonnes.
Tata Motors is also expanding its international footprint, established through

exports since 1961. The company's commercial and passenger vehicles are already
being marketed in several countries in Europe, Africa, the Middle East, South East
Asia, South Asia, South America, CIS and Russia. It has franchisee/joint venture
assembly operations in Bangladesh, Ukraine, and Senegal.
The foundation of the company's growth over the last 68 years is a deep
understanding of economic stimuli and customer needs, and the ability to translate
them into customer-desired offerings through leading edge R&D. With over 4,500
engineers, scientists and technicians the company's Engineering Research Centre,
established in 1966, has enabled pioneering technologies and products. The
company today has R&D centres in Pune, Jamshedpur, Lucknow, Dharwad in India,
and in South Korea, Italy, Spain, and the UK.
It was Tata Motors, which launched the first indigenously developed Light
Commercial Vehicle in 1986. In 2005, Tata Motors created a new segment by
launching the Tata Ace, India's first indigenously developed mini-truck. In 2009, the
company launched its globally benchmarked Prima range of trucks and in 2012 the
Ultra range of international standard light commercial vehicles. In their power,
speed, carrying capacity, operating economy and trims, they will introduce new
benchmarks in India and match the best in the world in performance at a lower lifecycle cost.
Tata Motors also introduced India's first Sports Utility Vehicle in 1991 and, in
1998, the Tata Indica, India's first fully indigenous passenger car.
In January 2008, Tata Motors unveiled its People's Car, the Tata Nano. The
Tata Nano has been subsequently launched, as planned, in India in March 2009, and
subsequently in 2011 in Nepal and Sri Lanka. A development, which signifies a first
for the global automobile industry, the Nano brings the joy of a car within the reach
of thousands of families.
Tata Motors is equally focussed on environment-friendly technologies in
emissions and alternative fuels. It has developed electric and hybrid vehicles both
for personal and public transportation. It has also been implementing several
environment-friendly
technologies
enhancing resource conservation.
in
manufacturing
processes,
significantly
Through its subsidiaries, the company is engaged in engineering and

automotive solutions, automotive vehicle components manufacturing and supply
chain activities, vehicle financing, and machine tools and factory automation
solutions.
Tata Motors is committed to improving the quality of life of communities by
working on four thrust areas - employability, education, health and environment.
The activities touch the lives of more than a million citizens. The company's support
on education and employability is focused on youth and women. They range from
schools to technical education institutes to actual facilitation of income generation.
In health, the company's intervention is in both preventive and curative health care.
The goal of environment protection is achieved through tree plantation, conserving
water and creating new water bodies and, last but not the least, by introducing
appropriate technologies in vehicles and operations for constantly enhancing
environment care.
2015
Vistara takes to the skies
Prime Minister of India, Narendra Modi, releases commemorative coin to

mark the 175th birth anniversary of Jamsetji Nusserwanji Tata
2014
Tata Sons sets up office in Singapore as base for Asean region
WWF-India and Tata Housing unveil first-ever crowd-funding campaign for

species conservation in India
Tata Chemicals celebrates 75 years of glorious presence
Tata Motors unveils the all-new Zest and Bolt
Voltas and Dow Chemical Pacific (Singapore) join forces in India
Tata headquarters is India's first heritage building to get prestigious green

rating
Land Rover debuts invisible car technology
TCS and Mitsubishi Corporation join forces, create strategic Japanese IT

services company
Tata Global Beverages' UK subsidiary acquires 100 percent equity stake in

Earth Rules, Australia
Tata Power crosses 500 MW landmark of renewable energy generation

capacity
Tata Power Solar successfully commissions Indias largest solar power

project with NTPC
Jaguar Land Rover develops the self-learning intelligent car of the future
Pilatus and Tata Advanced Systems announce the manufacturing of PC-12

'Green Aircraft' aerostructures in India
Tata ClassEdge crosses 10,000 classrooms milestone
CMC amalgamates with TCS
First Land Rover Discovery Sport rolls off the production line securing 3.5
billion in UK supplier contracts
Tata Motors celebrates 60 years of truck manufacturing in Jamshedpur
Tata Power Solar completes 25 years of harnessing solar power to

transform lives
2013
Tata Motors Jamshedpur plant rolls out its two millionth truck
Tata Power synchronises fifth 800MW unit and makes its first UMPP of
4,000MW, at Mundra, fully operational

Tata Sons announces formation of the Group Executive Council
Tata Technologies acquires Cambric, a premier US-based engineering
services company
TCS acquires IT services firm Alti to help drive long-term growth in France
Titan Industries is now Titan Company
Tata Sons and Singapore Airlines to establish new airline in India
Mount Everest Mineral Water (MEMW) to be merged with Tata Global
Beverages
Jaguar Land Rover celebrates 1,000,000 vehicles built at Halewood
operations
Tata Toyo and Air International enter into a joint venture
Titan Company celebrates retail milestone with 1,000 stores
2012
Tata Global Beverages and Starbucks form joint venture to open Starbucks
cafs across India. First outlet launched in October in Mumbai

Tata Communications completes worlds first wholly-owned cable network
ring around the world

Indias first iodine plus iron fortified salt launched by Tata Chemicals
Tata AIG Life Insurance Company to be now called Tata AIA Life Insurance
2011
Tata Chemicals rebrands its global subsidiaries in the UK, the US and
Kenya under the Tata Chemicals corporate brand

The Tata brand soars into the top 50 club of global brands
Tata Medical Center, a comprehensive cancer care and treatment facility
established in Kolkata, was inaugurated by Tata Sons Chairman Ratan Tata

The Tata Nano begins international journey in Sri Lanka and Nepal
Jaguar celebrates 50 years of iconic E-Type car
Tata Steel completes centenary of its first blast furnace
Tata BP Solar becomes wholly owned Tata company (now known as Tata
Power Solar Systems)
2010
TRF acquires UK-based Hewitt Robins International

New plant for Tata Nano at Sanand inaugurated
Advinus Therapeutics announces the discovery of a novel molecule
GKM-001 for the treatment of type II diabetes

Tata Tea announces joint venture with PepsiCo for health drinks
Tata Tea group rebrands itself as Tata Global Beverages, headquartered in
London
Tata Chemicals acquires 100-per-cent stake in leading vacuum salt
producer British Salt, UK

Tata Chemicals launches i-Shakti dals, India's first national brand of pulses
2009
Tata Motors announces commercial launch of the Tata Nano; delivers first
Tata Nano in the country in Mumbai

Tata Teleservices announces pan-India GSM service with NTT DOCOMO
TRF acquires Dutch Lanka Trailer Manufacturers (DLT), Sri Lanka, a world-
class trailer manufacturing company

Jaguar Land Rover introduces its premium range of vehicles in India
Tata Chemicals launches Tata Swach the worlds most cost-effective
water purifier
Tata Housing makes waves with its launch of low cost housing in Mumbai
2008
Tata Motors unveils Tata Nano, the Peoples Car, at the 9th Auto Expo in
Delhi on January 10, 2008

Tata Motors acquires the Jaguar and Land Rover brands from the Ford
Motor Company
Tata Chemicals acquires General Chemical Industrial Products Inc (now
known as Tata Chemicals North America)
Company
Starbucks opens spectacular flagship store in Mumbai, honouring the
dynamic culture of India

Tetley Tea celebrates 175th anniversary
Tata Steel expands aerospace activities in China
Cyrus P Mistry takes over as Chairman, Tata Sons from Ratan N Tata
Board of Directors
Mr. Mistry with the Safari Storme
Mr. Kant with the Ultra

Mr. Wadia with the Range Rover Evoque
Mr. Cyrus P. Mistry
Non-Executive Director and Chairman
Mr. Mistry was appointed as a Director of Tata Motors with effect from May 29,
2012, and as Deputy Chairman of the Company with effect from November 7, 2012.
Mr. Mistry took over as Chairman from Mr. Ratan N. Tata on his retirement with
effect from December 28, 2012.
Mr. Mistry was earlier Managing Director of the Shapoorji Pallonji group and
was also responsible for building the infrastructure development vertical in the
Shapoorji Pallonji group.
Mr. Mistry is a Graduate of Civil Engineering from the Imperial College London
(1990) and has an MSc in Management from the London Business School (1997). He
was recently bestowed with the Alumni Achievement Award by the London Business
School.
Mr. Ravi Kant
Non-Executive Director and Vice Chairman
Mr. Kant has been with the Company since February 1999, joining as Senior
Vice President (Commercial Vehicles), and was inducted on the Board as an
Executive Director in July 2000 and became the Managing Director in July 2005.
Upon retiring from his Executive position on June 1, 2009, Mr. Ravi Kant continues to
be on the Companys Board of Directors as Vice-Chairman.
Prior to joining the Company, he was with Philips India Limited as Director of
Consumers Electronics business and prior to which with LML Ltd. as Senior
Executive Director (Marketing) and Titan Watches Limited as Vice President (Sales &
Marketing).
Mr. Ravi Kant holds a Bachelor of Technology degree in Metallurgical

Engineering from the Institute of Technology, Kharagpur and a Master's degree in
Science from the University of Aston, Birmingham, UK.
Mr. Nusli N. Wadia

Non-Executive, Independent Director
Educated in the UK, Mr. Wadia is the Chairman of the Bombay Dyeing &
Manufacturing Company Limited and heads the Wadia Group. He is also the
Chairman/ Trustee of various charitable institutions and non-profit organisations.
Mr. Wadia has been on the Companys Board since December 1998 as an
Independent Director.
Dr. Raghunath A. Mashelkar
Dr. Mashelkar is an eminent chemical engineering scientist retired from the
post of Director General from the CSIR and is the President of Indian National
Science Academy (INSA), National Innovation Foundation, Institution of Chemical
Engineers, UK and Global Research Alliance. The President of India honoured Dr.
Mashelkar with the Padmashri (1991) and the Padmabhushan (2000). Dr. Mashelkar
holds a Ph.D. in Chemical Engineering from the Bombay University.
He was appointed as an Independent Director of the Company w.e.f. August
28, 2007.
National interest:
The Tata group is committed to benefit the economic development of the
countries in which it operates. No Tata company shall undertake any project or
activity to the detriment of the wider interests of the communities in which it
operates.
A Tata companys management practices and business conduct shall benefit
the country, localities and communities in which it operates, to the extent possible
and affordable, and shall be in accordance with the laws of the land.
A Tata company, in the course of its business activities, shall respect the
culture, customs and traditions of each country and region in which it operates. It
shall conform to trade procedures, including licensing, documentation and other
necessary formalities, as applicable.
Financial reporting and records:

A Tata company shall prepare and maintain its accounts fairly and
accurately and in accordance with the accounting and financial reporting standards
which represent the generally accepted guidelines, principles, standards, laws and
regulations of the country in which the company conducts its business affairs.
Internal accounting and audit procedures shall reflect, fairly and accurately,
all of the companys business transactions and disposition of assets, and shall have
internal controls to provide assurance to the companys board and shareholders
that the transactions are accurate and legitimate. All required information shall be
accessible to company auditors and other authorised parties and government
agencies.There shall be no willful omissions of any company transactions from the
books and records, no advance-income recognition and no hidden bank account and
funds.
Any willful, material misrepresentation of and / or misinformation on the
financial accounts and reports shall be regarded as a violation of the Code, apart
from inviting appropriate civil or criminal action under the relevant laws. No
employee shall make, authorise, abet or collude in an improper payment, unlawful
commission or bribing.
Competition:
A Tata company shall fully support the development and operation of
competitive open markets and shall promote the liberalisation of trade and
investment in each country and market in which it operates. Specifically, no Tata
company or employee shall engage in restrictive trade practices, abuse of market
dominance or similar unfair trade activities.
A Tata company or employee shall market the companys products and
services on their own merits and shall not make unfair and misleading statements
about competitors products and services. Any collection of competitive information
shall be made only in the normal course of business and shall be obtained only
through legally permitted sources and means.
Equal opportunities employer:

A Tata company shall provide equal opportunities to all its employees and
all qualified applicants for employment without regard to their race, caste, religion,
colour, ancestry, marital status, gender, sexual orientation, age, nationality, ethnic
origin or disability.
Human resource policies shall promote diversity and equality in the

workplace, as well as compliance with all local labour laws, while encouraging the
adoption of international best practices.
Employees of a Tata company shall be treated with dignity and in accordance
with the Tata policy of maintaining a work environment free of all forms of
harassment, whether physical, verbal or psychological. Employee policies and
practices shall be administered in a manner consistent with applicable laws and
other provisions of this Code, respect for the right to privacy and the right to be
heard, and that in all matters equal opportunity is provided to those eligible and
decisions are based on merit.
Gifts and donations:

A Tata company and its employees shall neither receive nor offer or make,
directly or indirectly, any illegal payments, remuneration, gifts, donations or
comparable benefits that are intended, or perceived, to obtain uncompetitive
favours for the conduct of its business. The company shall cooperate with
governmental authorities in efforts to eliminate all forms of bribery, fraud and
corruption.
However, a Tata company and its employees may, with full disclosure, accept
and offer nominal gifts, provided such gifts are customarily given and / or are of a
commemorative nature. Each company shall have a policy to clarify its rules and
regulations on gifts and entertainment, to be used for the guidance of its
employees.
Government agencies:
A Tata company and its employees shall not, unless mandated under
applicable laws, offer or give any company funds or property as donation to any
government agency or its representative, directly or through intermediaries, in
order to obtain any favourable performance of official duties. A Tata company shall
comply with government procurement regulations and shall be transparent in all its
dealings with government agencies.
Political non-alignment:
A Tata company shall be committed to and support the constitution and
governance systems of the country in which it operates.
A Tata company shall not support any specific political party or candidate for
political office. The companys conduct shall preclude any activity that could be
interpreted as mutual dependence / favour with any political body or person, and it
shall not offer or give any company funds or property as donations to any political
party, candidate or campaign.
Health, safety and environment:

A Tata company shall strive to provide a safe, healthy, clean and
ergonomic working environment for its people. It shall prevent the wasteful use of
natural resources and be committed to improving the environment, particularly with
regard to the emission of greenhouse gases, and shall endeavour to offset the effect
of climate change in all spheres of its activities.
A Tata company, in the process of production and sale of its products and
services, shall strive for economic, social and environmental sustainability.
Quality of products and services:

A Tata company shall be committed to supply goods and services of worldclass quality standards, backed by after-sales services consistent with the
requirements of its customers, while striving for their total satisfaction. The quality
standards of the companys goods and services shall meet applicable national and
international standards.
A Tata company shall display adequate health and safety labels, caveats and
other necessary information on its product packaging.
Corporate citizenship:
A Tata company shall be committed to good corporate citizenship, not only in
the compliance of all relevant laws and regulations but also by actively assisting in
the improvement of quality of life of the people in the communities in which it
operates.
The company shall encourage volunteering by its employees and
collaboration with community groups.
Tata companies are also encouraged to develop systematic processes and

conduct management reviews, as stated in the Tata corporate sustainability
protocol, from time to time so as to set strategic direction for social development
activity.
The company shall not treat these activities as optional, but should strive to
incorporate them as an integral part of its business plan.
Cooperation of Tata companies:

A Tata company shall cooperate with other Tata companies including
applicable joint ventures, by sharing knowledge and physical, human and
management resources, and by making efforts to resolve disputes amicably, as long
as this does not adversely affect its business interests and shareholder value.
In the procurement of products and services, a Tata company shall give
preference to other Tata companies, as long as they can provide these on
competitive terms relative to third parties.
Public representation of the company and the Group:

The Tata group honours the information requirements of the public and its
stakeholders. In all its public appearances, with respect to disclosing company and
business information to public constituencies such as the media, the financial
community, employees, shareholders, agents, franchisees, dealers, distributors and
importers, a Tata company or the Tata group shall be represented only by
specifically authorised directors and employees. It shall be the sole responsibility of
these authorised representatives to disclose information about the company or the
Group.
Third party representation:

Parties which have business dealings with the Tata group but are not
members of the Group, such as consultants, agents, sales representatives,
distributors, channel partners, contractors and suppliers, shall not be authorised to
represent a Tata company without the written permission of the Tata company, and /
or if their business conduct and ethics are known to be inconsistent with the Code.
Third parties and their employees are expected to abide by the Code in their
interaction with, and on behalf of, a Tata company. Tata companies are encouraged
to sign a non-disclosure agreement with third parties to support confidentiality of
information.
Use of the Tata brand:

The use of the Tata name and trademark shall be governed by manuals,
codes and agreements to be issued by Tata Sons. The use of the Tata brand is
defined in and regulated by the Tata Brand Equity and Business Promotion
agreement. No third party or joint venture shall use the Tata brand to further its
interests without specific authorisation.
Group policies:
A Tata company shall recommend to its board of directors the adoption of
policies and guidelines periodically formulated by Tata Sons.
Shareholders:
A Tata company shall be committed to enhancing shareholder value and
complying with all regulations and laws that govern shareholder rights.The board of
directors of a Tata company shall duly and fairly inform its shareholders about all
relevant aspects of the companys business, and disclose such information in
accordance with relevant regulations and agreements.
Ethical conduct:
Every employee of a Tata company, including full-time directors and the chief
executive, shall exhibit culturally appropriate deportment in the countries they
operate in, and deal on behalf of the company with professionalism, honesty and
integrity, while conforming to high moral and ethical standards. Such conduct shall
be fair and transparent and be perceived to be so by third parties.
Every employee of a Tata company shall preserve the human rights of every
individual and the community, and shall strive to honour commitments.
Every employee shall be responsible for the implementation of and
compliance with the Code in his / her environment. Failure to adhere to the Code
could attract severe consequences, including termination of employment.
Regulatory compliance:
Employees of a Tata company, in their business conduct, shall comply with all
applicable laws and regulations, in letter and spirit, in all the territories in which
they operate. If the ethical and professional standards of applicable laws and
regulations are below that of the Code, then the standards of the Code shall prevail.
Directors of a Tata company shall comply with applicable laws and regulations
of all the relevant regulatory and other authorities. As good governance practice
they shall safeguard the confidentiality of all information received by them by virtue
of their position.
Concurrent employment:
Consistent with applicable laws, an employee of a Tata company shall not,
without the requisite, officially written approval of the company, accept
employment or a position of responsibility (such as a consultant or a director) with
any other company, nor provide freelance services to anyone, with or without
remuneration. In the case of a full-time director or the chief executive, such
approval must be obtained from the board of directors of the company.
Conflict of interest:
An employee or director of a Tata company shall always act in the interest of
the company, and ensure that any business or personal association which he / she
may have does not involve a conflict of interest with the operations of the company
and his / her role therein. An employee, including the executive director (other than
independent director) of a Tata company, shall not accept a position of responsibility
in any other non-Tata company or not-for-profit organisation without specific
sanction.
The above shall not apply to (whether for remuneration or otherwise):
a) Nominations to the boards of Tata companies, joint ventures or associate
companies.
b) Memberships / positions of responsibility in educational / professional bodies,
wherein such association will benefit the employee / Tata company.
c) Nominations / memberships in government committees / bodies or organisations.
d) Exceptional circumstances, as determined by the competent authority.
Competent authority, in the case of all employees, shall be the chief

executive, who in turn shall report such exceptional cases to the board of directors
on a quarterly basis. In case of the chief executive and executive directors, the
Group Executive Council shall be the competent authority.
An employee or a director of a Tata company shall not engage in any
business, relationship or activity which might conflict with the interest of his / her
company or the Tata group. A conflict of interest, actual or potential, may arise
where, directly or indirectly
a) An employee of a Tata company engages in a business, relationship or activity
with anyone who is party to a transaction with his / her company.
b) An employee is in a position to derive an improper benefit, personally or to any
of his / her relatives, by making or influencing decisions relating to any transaction.
c) An independent judgement of the companys or Groups best interest cannot be
exercised.
The main areas of such actual or potential conflicts of interest shall include
the following:
a) An employee or a full-time director of a Tata company conducting business on
behalf of his / her company or being in a position to influence a decision with regard
to his / her companys business with a supplier or customer where his / her relative
is a principal officer or representative, resulting in a benefit to him / her or his / her
relative.
b) Award of benefits such as increase in salary or other remuneration, posting,
promotion or recruitment of a relative of an employee of a Tata company, where
such an individual is in a position to influence decisions with regard to such benefits.
c) The interest of the company or the Group can be compromised or defeated.
Notwithstanding such or any other instance of conflict of interest that exist
due to historical reasons, adequate and full disclosure by interested employees shall
be made to the companys management. It is also incumbent upon every employee
to make a full disclosure of any interest which the employee or the employees
immediate family, including parents, spouse and children, may have in a family
business or a company or firm that is a competitor, supplier, customer or distributor

of or has other business dealings with his / her company.
Upon a decision being taken in the matter, the employee concerned shall be
required to take necessary action, as advised, to resolve / avoid the conflict.
If an employee fails to make the required disclosure and the management of
its own accord becomes aware of an instance of conflict of interest that ought to
have been disclosed by the employee, the management shall take a serious view of
the matter and consider suitable disciplinary action against the employee.
Securities transactions and confidential information:

An employee of a Tata company and his / her immediate family shall not
derive any benefit or counsel, or assist others to derive any benefit, from access to
and possession of information about the company or Group or its clients or suppliers
that is not in the public domain and, thus, constitutes unpublished, price-sensitive
insider information.
An employee of a Tata company shall not use or proliferate information that is
not available to the investing public, and which therefore constitutes insider
information, for making or giving advice on investment decisions about the
securities of the respective Tata company, Group, client or supplier on which such
insider information has been obtained.
Such insider information might include (without limitation) the following:
Acquisition and divestiture of businesses or business units.
Financial information such as profits, earnings and dividends.
Announcement of new product introductions or developments.
Asset revaluations.
Investment decisions / plans.
Restructuring plans.
Major supply and delivery agreements.
Raising of finances.
An employee of a Tata company shall also respect and observe the

confidentiality of information pertaining to other companies, their patents,
intellectual property rights, trademarks and inventions; and strictly observe a
practice of non-disclosure.
Protecting company assets:

The assets of a Tata company shall not be misused; they shall be employed
primarily and judiciously for the purpose of conducting the business for which they
are duly authorised. These include tangible assets such as equipment and
machinery, systems, facilities, materials and resources, as well as intangible assets
such as information technology and systems, proprietary information, intellectual
property, and relationships with customers and suppliers.
Citizenship:
The involvement of a Tata employee in civic or public affairs shall be with
express approval from the chief executive of his / her company, subject to this
involvement having no adverse impact on the business affairs of the company or
the Tata group.
Integrity of data furnished:

Every employee of a Tata company shall ensure, at all times, the integrity of
data or information furnished by him / her to the company. He / she shall be entirely
responsible in ensuring that the confidentiality of all data is retained and in no
circumstance transferred to any outside person / party in the course of normal
operations without express guidelines from or, the approval of the management.
Reporting concerns:
Every employee of a Tata company shall promptly report to the management,
and / or third-party ethics helpline, when she / he becomes aware of any actual or
possible violation of the Code or an event of misconduct, act of misdemeanour or
act not in the companys interest. Such reporting shall be made available to
suppliers and partners, too.
Any Tata employee can choose to make a protected disclosure under the
whistleblower policy of the company, providing for reporting to the chairperson of
the audit committee or the board of directors or specified authority. Such a
protected disclosure shall be forwarded, when there is reasonable evidence to
conclude that a violation is possible or has taken place, with a covering letter, which
shall bear the identity of the whistleblower.
The company shall ensure protection to the whistleblower and any attempts
to intimidate him / her would be treated as a violation of the Code.
Note:
The TCoC does not provide a full, comprehensive and complete explanation of
all the rules that employees are bound to follow. Employees have a continuing
obligation to familiarise themselves with all applicable laws, company policies,
procedures and work rules.
All JVs could adopt TCoC or a joint code of conduct incorporating all elements
of the TCoC.
This version of the TCoC supersedes all earlier versions and associated
documents and stands effective from October 1, 2013.
PRODUCT PICTURES
PRODUCTS OF TATA MOTORS
INDICA V2
INDICA LX
SAFARI DICOR
TATA SUMO
TURBO
SAFARI DELUX
SUMO VICTA
CHAPTER-III
REVIEW OF LITERATURE
CUSTOMER SATISFACTION:
Definition of Customer Satisfaction:

Kotler (1997) defines customer satisfaction as follows:
Satisfaction is a person's feelings of pleasure or disappointment resulting

from comparing a Products perceived performance (or outcome) in relation to his or
her expectations.
Brown (1992) defines customer satisfaction as:

satisfaction.
They are: The basic elements of the product or service, basic support
services, a recovery process for counteracting bad experiences, and extraordinary
service. There are many definitions of the key elements of the services, but this one
is considered appropriate in the context of care or after sales services.
Satisfaction is a function of perceived performance and expectation. If the
performance matches the expectations the customer is satisfied. If the performance
exceeds the expectation the customer is highly satisfied and delighted. If the
performance does not match the expectations the customer is dissatisfied.
Satisfaction is a persons feelings of pleasure of disappointment resulting for
comparing a products perceived performance (out-come) in relation t his/her
expectation. The link between customer satisfaction and customer loyalty is
proportional. Suppose customer satisfaction is rated on a scale from 1 5. At a very
low levels of customer satisfaction.
Level-1, customers are likely to abandon.
Level-2 to 4, customers are fairly satisfied but still find tit easy to
switch when a better offer comes along.
Level-5, the customer is very likely to repurchase an even spread good
word of mouth about the company.
Customers are very likely to repurchase LEVEL5
Customers are fairly satisfied
LEVEL
2-4
Low level of customer satisfaction
LEVEL
The key to generating high customer loyalty is to deliver high customer

value. A companys value proposition is much more than its positioning on a single
attribute. Most of the successful companies are raising expectations and delivering
performances to match. These companies are aiming for TCS Total Customer
Satisfaction. Customer satisfaction is both a goal and a marketing tool. Companies
that achieve high customer satisfaction ratings make sure that their target market is
known.
After sales support management system is apart of ERP Enterprise
Resource Planning solution dealing with the support module after the sales of
product. It creates an advanced environment to the organization, which are in to
technical support after sales e.g. Companies offering electronic goods and motor
vehicles etc.
The functional features include:
Customer complaints tracking

Service engineers information tracking
Job scheduling for the complaints
Spares management
Online support
Reports
Customer complaints tracking:

Complaint is the start point of any technical support system. With out a
client request the technical support is not initiated. Complaint tracking is done as
follows:
Client may come down or make a phone call or complaint online

The client is validated. The client may have an annual maintenance
contract or may have a product in warranty or of warranty.
The intensity of the complaint is to be estimated to allocate resources.
Expected service type has to be finalized. It may be online assistance
indoor or onsite assistance.
Service Engineers information tracking:

Information about the engineers is inevitable in job scheduling.
Information about the engineers has to be added, deleted or modified in the
database. It may contain the following: the name, id of the engineer; the skill set of
the manager; the status of the engineer.
Job scheduling for the complaints:
Job scheduling means sequencing the request to its intensity,

assignment of a service engineer and creating a job card. It is done to optimize the
technical resources and to render the best service to the customer. Minor problem
are processed by technicians requests are handled by the expert team.
The job card includes the following:

The compliant id, the assigned engineer id, the data and time of
service, the spare details, no. of man hours required etc.
The spare part name and serial number

The available quantity of each spare part
The prize, warranty and other specifications
The supplier information.
Online support:
The service is done online also. The client may visit the website to
obtain basic support information about the product and FAQ. He can chat with the
service engineer on phone or online.
Report:
The report reflects the current status of the system. The reports that
can be generated are as follows:
Customer request report status of the system. The reports that can
be requests.
Service engineer report provides the information about the skills
and strengths of the support team.
Job scheduling report states the allotment of engineers to jobs.
Spares report discloses the availability of all the shapes in the
system.
Receipts and payments report gives information about the cash flow
in the system.
Bills generation.
Customer satisfaction tracking:

Customer satisfaction is the key concept to dictate the future of the
organization. In order to maximize the customer satisfaction along with quick
response and efficient service some other activities are to be performed.
They may be as follows:
Reception of the customer with hospitality.
Entertaining environment to the customer.
Providing guidance about the usage and maintenance of the product.
Offering gift and discounts.
Operationalisation of Customer Satisfaction:

As customer needs and expectations are changing all the time, this will
lead to a situation whereby customers keep setting ever higher standards,
and therefore to achieve perfection is impossible. Markets should be seen as
a group of individual companies, and each of them must be treated
individually with different requirements, experiences, commitments, and
relationships.
Implementing
customer
satisfaction
philosophy
means
identifying customers, then identifying their needs and expectations and

finally, measuring their perceptions. Knowing the needs of the customer
makes it easier to anticipate the ideal set of products and services. A major
flaw for all the companies has proved to be their inability to understand other
ways that customers can be satisfied. By implementing direct and continuous
employee contacts with the customers, the customers' requirements and
expectations
can
be
determined.
This
employee-customer
connection
additionally conveys the message that the company cares about their
customers.
Customer needs can be determined through marketing research,

customer interviews, reading customer concerns, or involving customers in
the design of services and service deliveries. In order to decide if the service
can be provided at a profit, it is necessary to link value equation to the
strategic service vision. Working together with both supplier and customer
can increase profitability by expanding margin potential.
A customer satisfaction study should begin by asking about the factors
affecting customer satisfaction, how important those factors are for the
whole, and the level of customer satisfaction. A problem with customer
satisfaction surveys (Naumann, 1994) is that a poor customer satisfaction
programme yields vague data and raises customer expectations. If customer
expectations are raised and a company's performance remains the same, the
customer's overall satisfaction will decrease.
Business Definition for: After-sales Service:
Customer support following the purchase of a product or service. In some

cases, after-sales service can be almost as important as the initial
purchase. The manufacturer, retailer, or service provider determines what
is included in any warranty (or guarantee) package. This will include the
duration of the warranty traditionally one year from the date of purchase,
but increasingly two or more years maintenance and/or replacement
policy, items included/excluded, labor costs, and speed of response. In the
case of a service provider, after-sales service might include additional
training or helpdesk availability. Of equal importance is the customer's
perception of the degree of willingness with which a supplier deals with a
question or complaint, speed of response, and action taken.
After Sales Excellence:

After Sales Excellence is a key driver for customer satisfaction and loyalty but
also a very important source of revenues and profits throughout a vehicle lifecycle. Our after
sales experts support our clients in all relevant areas of after sales service to improve the internal
cost base, the retail attractiveness as well as customer satisfaction. Our results are measurable -
significant improvements on key indicators such as warranty costs, service quality, and fixed first
visit rate.
Supply Chain Excellence:

Our Supply Chain Excellence service enables you to realize substantial
improvements in your supply chain performance in terms of cost, efficiency, lead times, demand
management, customer service and working capital requirements. We measure, improve and
qualify supply chain organizations and processes and support our clients by identifying and
rapidly implementing cost and efficiency savings in the entire supply chain. This can be achieved
with the comprehensive, cross-functional redesign of all logistics processes leveraging the entire
supply chain including customers and suppliers. With our proven Integrated Supply Chain
Excellence Audit we quickly identify gaps to proven best practices and benchmarks within, and
beyond, the Automotive Industry.
Value Chain Design:

Constantly reviewing the companies value chain in a rapidly evolving
environment; deriving required core competencies and partnerships is a key management
responsibility. We help our clients design their value chain in terms of a global engineering
footprint, production and service network, thereby improving efficiency and customer
satisfaction in alignment with corporate strategy.
Customer Contacts and Relationships:

In all cases, the supplier had been involved with the customer since the
beginning of the network building. It is difficult to distinguish whether some of the
changes in customer-supplier relationship were due to the duration of the
relationship between the two parties and whether some of the changes were caused
by changes in the customer's needs resulting from the customer's new position in
the network life cycle curve. For the results of this research, that question in terms
of the underlying factors has not addressed, but for future studies, it would be
relevant to clarify which of these two factors is the more significant or in fact,
whether they can be distinguished.
Relation of the Care to Customer Satisfaction:

Innis
and
La
Londe
(1994)
discovered
that
several
customer
satisfaction variables significantly affect a customer's total customer satisfaction.

Customer service attributes received high ratings for the importance of customer
satisfaction. Attributes for physical distribution of customer service were rated
higher than many marketing attributes.
Most Important Services:

Barsky (1995) proposed that what is important for one customer may
not be important for another. Barsky proposes this in the area of priority marketing,
and the idea was applied to different services in general. When a buyer considers
closer integration with a supplier, they may consider that it will most likely limit the
number of potential suppliers and fear that the partner may take advantage of this
by increasing prices or delivering poorer quality or poorer service. Interlocking with
the supplier can limit the opportunity to acquire innovations if the supplier lacks the
capability of being a leading-edge supplier. Research has shown that there are
frequently differences between the views of the supplier's management on
customer value and the customers' views on what they say they value. This was
studied in the present study as well.
CHAPTER-IV
DATA ANALYSES:
1. What is the model of cars used by customers?
A) Indica DLX
B) Indica V2
C) TATA Sumo
D) TATA Safari
E) TATA Dicor
S.No
Models
No.of
Percentag
Respondents
Indica DLX
37
37
Indica V2
37
37
TATA Sumo
13
13
TATA Safari
10
10
TATA Dicor
03
03
100
100%
Total No.of Respondents
Interpretation:
It is observed that 37% of the total respondents use Indica DLX, 37% of the
respondents use Indica V2,13% of the respondents use TATA Sumo,10% of the
respondents use TATA Safari and last 03% of respondents use TATA Dicor model.
.
2. Which type of Car have you bought?
A) New
B) Pre Owned
S.No
Buyers
New
Pre Owned
Total No. of Respondents
No. of
Percentag
Respondents
94
94
100
100%
Interpretation:
From the survey conducted it is observed that 94% of the respondents
purchased new cars and 6% of the respondents purchased Pre Owned
cars.
3. Whether the price of the Vehicle is?
A) Affordable
B) Not Affordable
S.No
Price
No. of
Percentag
Respondents
Affordable
85
85
Not Affordable
15
15
100
100%
Interpretation:
It is observed that 85% of the people feel that the price of vehicle is affordable,
and 15% of people feel that the price of vehicle is not affordable.
4. What is the purpose of buying this Car?
A) Personal use
B) Rental use
C) Other use
S.No
Purpose of
No. of
Percentag
buying
Respondents
Personal use
87
87
Rental use
10
10
Other use
100
100%
Interpretation:
From the data collected it is observed that 87% of the customers use
their vehicle for personal use, 10% of the customers use their vehicle
use for rental and 3 % of the buyers use for other use.
5. Who influenced in buying this Car?
A) Your self
B) Family
C) Friends
D) Advertisement
S.No
Influenced
No. of
Percentag
Respondents
Your self
48
48
Family
32
32
Friends
12
12
Advertisement
100
100%
Interpretation:
From the study it is observed that 48% is influenced by themselves,
36% feel that the family place a vital role to purchase there vehicle,
and then comes to friends 12% and then advertisement 8%.
6. What does this car convey?
A) Status
B) Necessity
C) Comfort
D) Other
S.No
Car Conveys
No. of
Percentag
Respondents
Status
24
24
Necessity
54
54
Comfort
18
18
Other
04
04
100
100%
Interpretation:
From the data collected it is concluded that 24% of the consumers purchase the
vehicle to maintain the status, where as 54% of the consumers purchase the vehicle
because of their necessity. 18% of the consumers purchases as it gives comfort,
12% of the consumer purchase the vehicle for other reason.
7. What are the reasons for buying this Car?
A) Price
B) Mileage
C) Service
D) Brand Image
S.No
Crucial
No. of
Percentag
Respondents
Price
34
34
Mileage
53
53
Service
Brand Image
100
100%
Interpretation:
It is concluded from the study that 34% of them say that price is crucial, 53%
of them say mileage and 7% & 6% of them say service and brand image.
8. You use your Car mostly for?
A) Office
B) Family
C) Long drives
D) Shopping
S.No
Car used for
No. of
Percentag
Respondents
Office
44
44
Family
45
45
Long Drives
Shopping
100
100%
Interpretation:
It was observed that 44% of the respondents use there vehicle for going to
office, 45% of the respondents use there vehicle to take there family out and 2%
and 9% of the respondents use there vehicle of shopping and long drives.
9. How long you will use this vehicle?
A) 1-2 years
B) 2-4 years
C) 4-8 years
D) 8 years & above
S.No
How long you
No. of
Percentag
will use
Respondents
1-2 years
2-4 years
15
15
4-8 years
68
68
8 years & above
12
12
100
100%
Interpretation:
From the study it is observed that 5%and 15% of the consumer keep their
vehicle 1-2 years and 2-4 years and 68% and 12% of consumers keep their vehicle
for 4-8 years and 8 years &above.
10.
Rate
your
satisfaction
for
the
service
provided
Organization?
A) Excellent
B) Good
C) O.K
D) Poor
S.No
Satisfaction level
No. of
Percentag
at service station
Respondents
Excellent
Good
61
61
O.K
24
24
Poor
100
100%
by
the
Interpretation:
From the survey conducted satisfied level at service center show at X-axis
and No.Respondents at Y-axis. 7 % of the consumers said excellent, 61% said good
and 24% and 8% of the consumers said ok and poor.
11.
Are you satisfied with mileage give by your Car?
A) yes
B) no
S.No
Satisfied with
No. of
Percentag
mileage
Respondents
Yes
81
81
NO
19
19
100
100%
Interpretation:
It is observed that 81% of the respondents are satisfied with mileage given by
there car and 19% are not satisfied with mileage given by there cars.
12.
Express your satisfaction level on performance of your Vehicle?
A) satisfied
B) O.K
C) Not satisfied
S.No
Performance of
No. of
Percentag
your vehicle
Respondents
Satisfied
80
80
O.K
20
20
Not satisfied
00
00
100
100%
Interpretation:
It was observed that 80% of customers are satisfied on the overall
performance of the vehicle and 20% of the customers are at constant (o.k).
13.
Comment on the prices charged at service station?
A) High
B) Medium
C) Reasonable
D) Low
S.No
Comment on
No. of
Percentag
prices
Respondents
High
Medium
38
38
Reasonable
56
56
Low
100
100%
Interpretation:
It was observed that 8% of the respondents feel that the prices charged at
service station was high and 38% feel it is medium and 56% of the respondents feel
that the prices are reasonable cost and 2% feel that the prices are low.
14.
How is the performance of the executives?
A) Excellent
B) Good
C) O.K
D) Poor
S.No
Performance of
No. of
Percentag
Executives
Respondents
Excellent
Good
62
62
O.K
23
23
Poor
100
100%
Interpretation:
It is observed that 8% of the respondents feel that performance of executives

is excellent, 62% of the respondents said that performance of the executives is
good, 23% the respondents said the performance of the executives is ok and 7% of
the respondents said that performance of the executives is poor.
CHAPTER-V
FINDINGS:
SUGGESTIONS
CONCLUSION
BIBLIOGRAPHY
QUESTIONNAIRE
FINDINGS:
Most of the buyers are professionals and business people using the TATA cars.
94% of the respondents purchase new cars only.
Nearly about 85% of the customers feel that the price of vehicle
is affordable.
About 87% of the respondents use TATA cars for there personal
use.
The reason for purchase only TATA is necessity for 54% of the
customers, 24% of the consumers feels status and 18% feel
comfortable.
Many of the respondents are satisfied with regard to mileage,

price.
45% of the respondents use there vehicle to take there family

out and 44% use for going to office.
61% of the respondents were satisfied with service provided by

the dealer at the service center, 24% and 7% of the respondents
said ok and excellent, and 8% of the respondents were not
satisfied with service at service station.
Above 56% of the respondents feel the prices are reasonable at

the service center. Where 8% and 38% of the respondents feel
that the prize are high and medium respectively.
62% of the respondents feel that the overall performance of the

vehicle is good, 8% and 23% of the respondents feel that the
performance of the vehicle is excellent and o.k.
SUGGESTIONS:
It
is suggested that some more place should be provided for
luggage.
To provide better service to customers at work shop
To make the vehicle more spacious inside
To improve the comfort ness in the vehicle
Skilled and experienced persons should be provided at service
center, so that problems of the vehicle should be resolved
completely.
Engine capacity should be increase, this leads to increase mileage
and pickup once when A/C is on
To increase the place of parking at work shop.
CONCLUSION:
The global business environment is buzzing with the single most important
issue of Building a competitive edge by creating and retaining a large number of
customers than their goods and services every organization is there fore seized of
the task of establishing sustaining its worth to the customer, who has been
rendered unpredictable by competition
Therefore every business is making a continuous effort for achieving

customer effort for achieving customer loyalty
In short it is total organizational culture and brand equity, which face

challenge. So that there is a perennial struggle amongst organizations to sustain
their existence in the market place, and hence in order to sustain the stiff
competition the company has to take up market Research frequently to know the
changing needs & preference of the customers.
This helps the company to reframe the policies in providing cutting edge
technology to satisfy the customer & retain him for a life time.
BIBLIOGRAPHY
Consumer Behavior
Leon G. Shiftman
Journals
ICFAI General of Marketing
Retail Marketing
Marketing Research
G.C.Beri
Magazines
Auto India
Principles of Marketing :
Business Today
Philip Kotler & Gary

Armstrong
Services Marketing
Web Sites
Adlarian Palmer
www.autofinlimited.com
www.tatamotors.com
QUESTIONNAIRE:
PERSONAL DATA
NAME
DESIGNATION
:
:
DEPARTMENT
EXPERIENCE
What is the model of cars used by customers?
b) Indica DLX
c) Indica V2
d) TATA Sumo
e) TATA Safari
2. Which type of Car have you bought
a) New
b) Pre Owned
3. Whether the price of the Vehicle is?
a) Affordable
b) Not Affordable
4. What is the purpose of buying this Car?
a) Personal use
b) Rental use
c) Other use
5. Who influenced in buying this Car?
a) Your self
b) Family
c) Friends
d) Advertisement
6. What does this car convey?
a) Status
b) Necessity
c) Comfort
d) Other
7. What are the reasons for buying this Car?
a) Price
b) Mileage
c) Service
d) Brand Image
8. You use your Car mostly for?
a) Office
b) Family
c) Long drives
d) Shopping
9. How long you will use this vehicle?
a) 1-2 years
b) 2-4 years
c) 4-8 years
d) 8 years & above
10.Rate your satisfaction for the service provided by the Organization?
a) Excellent
b) Good
c) O.K
d) Poor
11.Are you satisfied with mileage give by your Car?
a) yes
b) no
12.Express your satisfaction level on performance of your Vehicle?
a) satisfied
b) O.K
c) Not satisfied
13.Comment on the prices charged at service station?
a) High
b) Medium
c) Reasonable
d) Low
14.How is the performance of the executives?
a) Excellent
b) Good
c) O.K
d) Poor
15.Suggestions for the company?
---------------------------------------------------------------------------------------------------------------------------------------
CHAPTER-I
INTRODUCTION
INVENTORY MANAGEMENT
INTRODUCTION:
.Stock, stock, beautiful stock

Piles on the fixtures and more in the dock
Some of it ancient and some of it new
Alas, and tomorrow another lots due.
The couplet beautifully sums up the predicament of all those who are connected
with the stock (inventory). What is this inventory? What are its functions? What can
be done to minimize this inventory? These and other relevant issues have been
discussed in this chapter.
Every enterprise needs inventory for smooth running of its activities. It serves as
a link between production and distribution process. There is, generally, a time lag
between the recognition of a need and its fulfillment. The greater the time lag, the
higher requirements for inventory. It also provides a cushion for future price
fluctuations.
In a complex industry like Hero MotoCorp Ltd. it studied clearly of how the
thing are being performed and what is the real impact of these on industry and how
effectively the inventory is utilized is interested to be known by researcher because
of its great significance in the research.
MEANING AND NATURE OF INVENTORY

Inventory can be referred to as sum of the value of raw materials fuels and
lubricants, spare parts, maintenance consumables, semi processed materials and
finished goods, stock at any given point of time.
In large companies inventory place a most significant part of the current assets.
The business has about 15 to 30% of inventories in total assets.
Inventory is composed of assets that will be sold in feature in the normal course of
business operations. The assets which firms stores as inventory is anticipation of
need are raw materials, work in progress and finished goods.
MEANING OF INVENTORY MANAGEMENT

Inventory management consists of maintaining for a given financial investment an
adequate of something in order to meet and accepted pattern of demand.
Inventory considers control over costs of inventory on one hand and handle the size
of inventory on other hand.
Controlling investments in inventories constitute crucial part in current assets.

An efficient inventory controlling system will decide,
What to purchase
When to purchase
How to purchase
Size of purchase
And from where to purchase (Suppliers)
The main purpose of inventory management is to ensure
Required quantity of availability of raw materials
Minimize the investments in inventories.
INVENTORY CONTOR
Inventory control is the system devised an adopted for controlling investments in
inventory. It involves inventory planning and decision making with regard to the
quantity and time of purchase, fixation of stock levels, maintenance of stock records
and continuous stock taking.
IMPORTANCE OF THE STUDY:
Decisions Relating to Inventories are taken primarily by executives in
productions, purchasing, and marketing departments. Usually, raw material policies
are shaped by purchasing and production executives, work-in-process inventory is
influenced by the decisions of production executives, and finished goods inventory
policy is evolved by production and marketing executives. Yet, as inventory
management has important financial implications, the financial manager has the
responsibility to ensure that inventories are properly monitored and controlled. He
has to emphasize the financial point of view and initiate programmes with the
participation and involvement of others for effective management of inventories.
NEED OF THE STUDY:

Every industry on average spends 70% on raw materials (inventory).
Therefore there is a need to know the raw material cost and also there is great
importance to understand the inventory management system of this industry.
The study helps a log to various departments to take steps to control the
inventory process.
SCOPE OF STUDY:
The scope of study is limited to collecting the financial data published

in the annual reports of the company with reference to the objectives stated above
and an analysis of the data with a view to suggest favorable solutions to the various
problems related to Inventory Control Management.
This particular topic is selected to the Inventory Control Management is
recent years. The study is conducted to evaluate the performance of the company
with reference to inventory control management. The project is aimed at studying
by means of developing effective Inventory Control Management
OBJECTIVES OF THE STUDY:
To examine the organization structure of inventory management in the

stores of Hero MotoCorp Ltd. (Formerly Hero Honda Motors Ltd.)
(Phoenix Motors Pvt. Ltd).
To discuss pattern, levels and trends of inventories in Hero MotoCorp
Ltd.
To understand the various inventory control techniques followed by
studies in Hero MotoCorp Ltd.
To access the performance of inventory management of the Hero
MotoCorp Ltd by selected accounting ratios.

To know the inventory control techniques of Hero MotoCorp Ltd.
METHODOLOGY :
The study is based on both primary and secondary data.

PRIMART DATA:
The primary data has been collected through structured questionnaire
reflecting inventory management practices of Hero MotoCorp Ltd.
SECONDARY DATA:
The collected data is tabulated and suitable interpretation had been made by
considering the data collection through secondary data like annual reports purchase
registers, storage records of the organization.

The study has the following limitations:
The study is limited only for a period of 5 years i.e., from 2009 10 to 2013
14.
The study in the organization is 45 days only.
The limitations of ratio analysis can be applicable of the study.

There may be approximation in calculating ratios and taking the figures from
the annual reports.
CHAPTER-II
INDUSTRY PROFILE
Introduction
The automobile industry is one of Indias most vibrant and growing industries. This
industry accounts for 22 per cent of the country's manufacturing gross domestic
product (GDP). The auto sector is one of the biggest job creators, both directly and
indirectly. It is estimated that every job created in an auto company leads to three
to five indirect ancillary jobs.
2020.
Market size
The cumulative foreign direct investment (FDI) inflows into the Indian automobile
industry during the period April 2000 August 2014 was recorded at US$ 10,119.68
million, as per data by Department of Industrial Policy and Promotion (DIPP).
Data from industry body Society of Indian Automobile Manufacturers (SIAM) showed
that 137,873 passenger cars were sold in July 2014 compared to 131,257 units
during the corresponding month of 2013. Among the auto makers, Maruti Suzuki,
Hyundai Motor India and Honda Cars India emerged the top three gainers with sales
growth of 15.45 per cent, 12 per cent and 11 per cent, respectively.
The three-wheeler segment posted a 24 per cent growth to 51,461 units on the
back of increased demands from the urban market. Total sales across different
Investments
To match production with demand, many auto makers have started to invest heavily
in various segments in the industry in the last few months. Some of the major
investments and developments in the automobile sector in India are as follows:

range with a few more offerings..
Hero Cycles through its unit OPM Global has acquired a majority stake in
German bicycle company Mitteldeutsche Fahrradwerke AG (MIFA) for 15
million (US$ 19.11 million). The company plans to invest an additional 4
million (US$ 5.09 million) as capital expenses in restructuring the acquired
company.
Government Initiatives
The Government of India encourages foreign investment in the automobile sector
and allows 100 per cent FDI under the automatic route. To boost manufacturing, the
government had lowered excise duty on small cars, motorcycles, scooters and
commercial vehicles to eight per cent from 12 per cent, on sports utility vehicles to
24 per cent from 30 per cent, on mid-segment cars to 20 per cent from 24 per cent
and on large-segment cars to 24 per cent from 27 per cent.
The governments decision to resolve VAT disputes has also resulted in the top
Indian auto makers namely, Volkswagen, Bajaj Auto, Mahindra & Mahindra and Tata
Motors announcing an investment of around Rs 11,500 crore (US$ 1.87 billion) in
Maharashtra.
The
Government
of
India-appointed
SIAM
and
Automotive
Components

Road Ahead
The future of the auto industry depends on the positive sentiments and the demand
for vehicles in the market. With the festival season coming up, the Indian auto
sector will see a rise in demand which is expected to bring in major growth. An auto
dealer survey by firm UBS suggested that the Indian auto industry, riding on trends
like the upcoming festival season and decline in fuel price, will observe a 12 per
cent y-o-y growth in FY15.
Also, keeping up with international trends, there is expected to be a surge in the
number of hybrid vehicles in the Indian auto sector in the years to come.
When other segments like passenger cars and commercial vehicles logged negative
growth, the two-wheeler makers registered around 13 percent growth between
January and October. Riding on the two-wheeler sector's growth, the automotive
industry grew 9.8 percent by volume year-on-year (YoY) between January and
October.
"The two-wheeler segment is the only one that has clocked positive growth at 12.9
percent YoY (year-on-year) to reach sales of nearly 13.5 million units by October.
This can be attributed to the low cost of two wheelersin India," Vijay Kakade, vice
president for automotive and transportation practice at Frost & Sullivan, told IANS.
He said the light commercial vehicle (LCV) segment has been the worst hit, with
sales reducing to approximately 330,000 units -- an 18.9 percent YoY fall over 2013.
"The passenger car, medium and heavy commercial vehicle segments contracted
by 0.8 and 6.5 percent respectively during the period, compared to 2013. The
reduction in sales can be attributed to the slowdown and the high interest rates set
by the RBI (Reserve Bank of India) reducing the availability of finance options to the
public," Kakade added.
"The industry is looking forward to the budget for pro-business policies to reignite
the automobile industry in India."
October.

October
Auto manufacturers have been trying to cope with economical rough patch in last
two years. Trying to boost sales and implementing cost effective schemes just
sentence).
Tata Motors apart from giving customers attractive offers, gave
600 of their employees early retirement offers, last month. Ashok Leyland too
offered 500 of their employees with irresistible retirement schemes, last year (pun
intended).
Sales of Cars, SUVs, Vans, pick-ups, and entire commercial vehicle segment went
south, with passenger vehicle market encountering first decline in the decade. But
what saved the overall scenario was the two-wheeler market. It took 7.31% hike
Society of Indian Automobile Manufacturers (SIAM) expects a 6% growth over in the
fiscal 2014-15, with boost in manufacturing sector, new investment and fresh
COMPANY PROFILE
Hero MotoCorp Ltd. (Formerly Hero Honda Motors Ltd.) is the world's largest
manufacturer of two - wheelers, based in India.
In 2001, the company achieved the coveted position of being the largest twowheeler manufacturing company in India and also, the 'World No.1' two-wheeler
company in terms of unit volume sales in a calendar year. Hero MotoCorp Ltd.
continues to maintain this position till date.
Vision
The story of Hero Honda began with a simple vision - the vision of a mobile and an
empowered India, powered by its two wheelers. Hero MotoCorp Ltd., company's
new identity, reflects its commitment towards providing world class mobility
solutions with renewed focus on expanding company's footprint in the global arena.
Mission
Hero MotoCorps mission is to become a global enterprise fulfilling its customers'
needs and aspirations for mobility, setting benchmarks in technology, styling and
quality so that it converts its customers into its brand advocates. The company will
provide an engaging environment for its people to perform to their true potential. It
will continue its focus on value creation and enduring relationships with its partners
Strategy
Hero MotoCorps key strategies are to build a robust product portfolio across
categories,
explore
growth
opportunities
globally,
continuously
improve
its
operational efficiency, aggressively expand its reach to customers, continue to

invest in brand building activities and ensure customer and shareholder delight.
Manufacturing
Hero MotoCorp two wheelers are manufactured across 3 globally benchmarked
manufacturing facilities. Two of these are based at Gurgaon and Dharuhera which
are located in the state of Haryana in northern India. The third and the latest
manufacturing plant is based at Haridwar, in the hill state of Uttrakhand.
Technology
In the 1980s Hero Honda pioneered the introduction of fuel-efficient, environment
friendly four-stroke motorcycles in the country. Today, Hero Honda continues to be
technology pioneer. It became the first company to launch the Fuel Injection (FI)
technology in Indian motorcycles, with the launch of the Glamour FI in June 2006.
Distribution
The Company's growth in the two wheeler market in India is the result of an intrinsic
ability to increase reach in new geographies and growth markets. Hero MotoCorps
extensive sales and service network now spans over to 6000 customer touch points.
These comprise a mix of authorized dealerships, service & spare parts outlets and
dealer-appointed outlets across the country.
Brand
The new Hero is rising and is poised to shine on the global arena. Company's new
identity "Hero MotoCorp Ltd." is truly reflective of its vision to strengthen focus on
mobility and technology and creating global footprint. Building and promoting new
brand identity will be central to all its initiatives, utilizing every opportunity and
leveraging its strong presence across sports, entertainment and ground-level
activation
HERO'S MANDATE
Hero is a world leader because of its excellent manpower, proven management,

extensive dealer network, efficient supply chain and world-class products with
cutting edge technology from Company, Japan. The teamwork and commitment are
manifested in the highest level of customer satisfaction, and this goes a long way
towards reinforcing its leadership status
BOARD OF DIRECTORS
No.
Name of the Directors
Designation
Mr. Brijmohan Lall Munjal
Chairman & Whole-time Director
Mr. Pawan Munjal
Managing Director & C.E.O.
Mr. Toshiaki Nakagawa
Joint Managing Director
Mr. Sumihisa Fukuda
Technical Director
Mr. Sunil Kant Munjal
Non-Executive Director
Mr. Suman Kant Munjal
Mr. Takashi Nagai
Mr. Yuji Shiga
Mr. Pradeep Dinodia
Non-executive & Independent

Director
10
Gen. (Retd.) V. P. Malik
Director
11
Mr. Analjit Singh

Director
BRIEF PROFILE OF DIRECTORS

MR. BRIJMOHAN LALL MUNJAL
Mr. Brijmohan Lall Munjal is the founder Director and Chairman of the Company
and the $ 3.2 billion Hero Group. He is the Past President of Confederation of Indian
Industry (CII), Society of Indian Automobile Manufacturers (SIAM) and was a Member
of the Board of the Country's Central Bank (Reserve Bank of India).
No Name of Company
Nature of Office
.
1
Hero Honda Motors Limited
Chairman and Whole-time Director
Hero Honda Finlease Limited
Chairman and Director
Munjal Showa Limited
Easy Bill Limited
Director
Rockman Industries Limited
Director
Shivam Autotech Limited
Director
STAKEHOLDER TIES AT THE GRASSROOTS

Hero Honda Motors takes considerable pride in its stakeholder relationships,
especially ones developed at the grassroots. The Company believes it has managed
to bring an economically and socially backward region in Dharuhera, Haryana, into
the national economic mainstream.
An Integrated Rural Development Centre has been set up on 40 acres of land along
the Delhi-Jaipur Highway. The Centre-complete with wide approach roads, clean
water, and education facilities for both adults and children-now nurtures a vibrant,
educated and healthy community.
The Foundation has adopted various villages located within vicinity of the Hero
Honda factory at Dharuhera for integrated rural development. This includes:
Installation of deep bore hand pumps to provide clean drinking water.
Constructing metalled roads and connecting these villages to the National

Highway (NH -8).
Renovating primary school buildings and providing hygienic water and toilet
facilities.
Ensuring a proper drainage system at each of these villages to prevent waterlogging.
Promoting non-conventional sources of energy by providing a 50 per cent

subsidy on biogas plants.
The Raman Munjal Vidya Mandir began with three classes (up to class II) and 55
students from nearby areas. It has now grown into a modern Senior Secondary,
CBSE affiliated co-educational school with over 1200 students and 61 teachers. The
school has a spacious playground, an ultra-modern laboratory, a well-equipped
audio visual room, an activity room, a well-stocked library and a computer centre.
The Raman Munjal Sports Complex has basketball courts, volleyball courts, and
hockey and football grounds are used by the local villagers. In the near future,
sports academies are planned for volley ball and basket ball, in collaboration with
National Sports Authority of India.
Vocational Training Centre
In order to help local rural people, especially women, Hero Honda has set up a
Vocational Training Centre. So far 26 batches comprising of nearly 625 women have
been trained in tailoring, embroidery and knitting. The Company has helped women
trained at this centre to set up a production unit to stitch uniforms for Hero Honda
employees. Interestingly, most of the women are now self-employed.
Adult Literacy Mission
This Scheme was launched on 21st September, 1999, covering the nearby villages
of Malpura, Kapriwas and Sidhrawali. The project started with a modest enrolment
of 36 adults. Hero Honda is now in the process of imparting Adult Literacy Capsules
to another 100 adults by getting village heads and other prominent villagers to
motivate illiterate adults.
Marriages of underprivileged girls
Marriages are organized from time to time, particularly for girls from backward
classes, by the Foundation by providing financial help and other support to the
families.
KEY POLICIES
AN ENVIRONMENTALLY AND SOCIALLY, AWARE COMPANY
At Hero Honda, our goal is not only to sell you a bike, but also to help you every
step of the way in making your world a better place to live in. Besides its will to
provide a high-quality service to all of its customers, Hero Honda takes a stand as a
socially responsible enterprise respectful of its environment and respectful of the
important issues.
Hero Honda has been strongly committed not only to environmental conservation
programmers but also expresses the increasingly inseparable balance between the
economic concerns and the environmental and social issues faced by a business. A
business must not grow at the expense of mankind and man's future but rather
must serve mankind.
"We must do something for the community from whose land we generate
our wealth."
A famous quote from our Worthy Chairman Mr.Brijmohan Lall Munjal.
Environment Policy
We at Hero Honda are committed to demonstrate excellence in our
environmental performance on a continual basis, as an intrinsic element of
our corporate philosophy.
To achieve this we commit ourselves to:
Integrate environmental attributes and cleaner production in all our business

processes and practices with specific consideration to substitution of
hazardous chemicals, where viable and strengthen the greening of supply
chain.
Continue product innovations to improve environmental compatibility.
Comply with all applicable environmental legislation and also controlling our
environmental discharges through the principles of "alara" (as low as
reasonably achievable).
Institutionalise resource conservation, in particular, in the areas of oil, water,

electrical energy, paints and chemicals.
Enhance environmental awareness of our employees and dealers / vendors,

while promoting their involvement in ensuring sound environmental
management.
Quality Policy
Excellence in quality is the core value of Hero Honda's philosophy.
We are committed at all levels to achieve high quality in whatever we do,
particularly in our products and services which will meet and exceed customer's
growing aspirations through:
Innovation in products, processes and services.
Continuous improvement in our total quality management systems.
Teamwork and responsibility.
Safety Policy
Hero Honda is committed to safety and health of its employees and other
persons who may be affected by its operations. We believe that the safe work
practices lead to better business performance, motivated workforce and higher
productivity.
We shall create a safety culture in the organization by:
Integrating safety and health matters in all our activities.
Ensuring compliance with all applicable legislative requirements.
Empowering employees to ensure safety in their respective work places.
Promoting safety and health awareness amongst employees, suppliers and

contractors.
Continuous improvements in safety performance through precautions besides

participation and training of employees.
INTRODUCTION ABOUT PHOENIX DEALER PROFILE (PHOENIX MOTORS)
PHOENIX MOTORS PVT LTD is dealership type of business. PHOENIX MOTORS

PVT LTD. is established on 21 st march 2003. The business is running by only
one man. The owner name is ch .madhu mathi the firm is located at habsiguda in
Hyderabad.
Generally the sale will be either on cash basis or on institutional basis.
Bank like ICICI, HDFC and CENTURION are providing loans to customers.
Advertising strategy of phoenix motors:
They are giving the ads through newspapers, wall paintings,
hoardings and field staff. They are upgrading sales by introducing the schemes,
group bookings, institutional sales and customer door-to-door activities.
Categorization of Staff members:
Staff members are categorized for technicians, 25 members are
allotted for field staff, 5 members are recruited for sales for persons, 5 persons are
placed for evaluating for spare parts, 5 members are allotted for managerial
accounts and another 3 persons for cash transaction and other members are
allotted for remaining work.
Customer relationship:
They entertain the showroom providing a customers huge
having pool game, internet facility and television with home there system. They
provide bile maintenance programs on every week.
According to other dealers PHOENIX motors in first in sales and best in service. They
treat customer, is the very important person at PHOENIX motors customer
satisfaction is their motto, why because, they will satisfied customer is the best
advertisement. They provide better value for the customers and as well as
employees also. At PHOENIX motors the customer is the boss.
SALES STRATEGY OF PHOENIX MOTORS:
Average they are selling 28 vehicles per day. PHOENIX motors PVT L.T.D
is the A.P s NO.1 dealership in sales and other activities? It is a QLAD (qualify leader
through quality dealer). At PHOENIX motor they gave the quality service to the
customers why because the cost is long forgotten but the quality is remembered
for ever. They treat quality has a...
Q
Quest for excellence
Understanding customers needs
Action to achieve customers appreciation.
Leadership determined to be a leader
involving all the people
T
Y
Team spirit to work for a common goal

Yard sticks to measure programs.
WARRANTY ON PROPRIETARY ITEMS:

Warranty on proprietary items like Tyros, Tubes and Battery etc, will be
directly handled by the respective original manufactures (OEMs) except AMCO for
batteries and Dunlop and Falcon tires and Tubes. In case of any defect in proprietary
items, other than the above two mentioned OEMS the dealers must approach the
Brach office dealer of the respective manufacture. For AMCO batteries and Dunlop
and falcon tires, tubes claims will be accepted at our authorized dealerships per the
mutually agreed terms and conditions between HERO and of these two OEMs in
case the claim is not accepted for invalid reasons. Then the claim along with the
refusal note form the OEM can be sent to the warranty section at gorgon plan after
due to recommendation of the area service engineer. If any other six services or
subsequent paid services is not availed as per the recommended schedule given in
the owners manual. If HERO recommended engine oil is not used. To normal wear &
tear components like bulbs, electric wiring, filters, spark plug, clutch plates, braded
shoes, fasteners, shim washers, oil seals, gaskets, rubber parts (other than tyre and
tube) plastic components, chain$ sprockets and in case of wheel rim misalignment
or bend.
SOCIAL SERVICE ACTIVITIES
PHOENIX motors participate and conduct social service activities. Recently

the phoenix motors organized a BLOOD DONATION CAMP for the trust on 21 st
January 2006.they motivated on the consumers to participated in this camp and
also provide certificate for the customers
THE MARKETED BIKES OF PHOENIX (All Hero Moto Corp.)
CUSTOMER RELATIONSHIP:
To entertain the customers the showroom providing a customers huge having
pool game, Internet facility and television with home theatre system. They provide
bike maintenance programs on every week. According to other dealers PHOENIX
motors in first in sales and best in service. They treat customer, is the very
important person at PHOENIX motors customer satisfaction is their motto, why
because, the well satisfied customer is the best advertisement. They provide
better value for the customers and as well as employees also. At PHONIX motors the
customer is the boss.
PHOENIX Motors participates in social service activities. The Phoenix motors
organize a BLOOD DONATION CAMP for the trust in every year. They motivated on
the customers to participated in this camp and also provide Certificate for the
customers.
CHAPTER-III
LITERATURE REVIEW
The investment in inventories constitutes the most significant part of current

assets / working capital in most of the undertakings. Thus, it is very essential to
have proper control and management of inventories.
The purpose of inventory management is to ensure availability of materials in
sufficient quantity as and when required and also to minimize investment in
inventories.
Meaning and Nature of Inventory:

In accounting language, inventory may mean the stock of finished goods only.
In a manufacturing concern, it may include raw materials, work- in progress and
stores etc.
Inventory includes the following things:

a)
Raw Material: Raw material from a major input into the organization.
They are required to carry out production activities uninterruptedly. The quantity of
raw materials required will be determined by the rate of consumption and the time
required for replenishing the supplies. The factors like the availability of raw
materials and Government regulations etc., too affect the stock of raw materials.
b)
Work in progress: The work in progress is that stage of stocks which are
in between raw materials and finished goods. The quantum of work in progress
depends upon the time taken in the manufacturing process. The quantum of work in
progress depends upon the time taken in the manufacturing process. The greater
the time taken in manufacturing, the more will be the amount of work in progress.
c)
Consumables: These are the materials which are needed to smoother

the process of production but they act as catalysts. Consumables may be classified
according to their consumption add critically. Generally, consumable stores doe not
create any supply problem and firm a small part of production cost. There can be
instances where these materials may account for much value than the raw
materials. The fuel oil may form a substantial part of cost.
d)
Finished goods: These are the goods, which are ready for the
consumers. The stock of finished goods provides a buffer between production and
market, the purpose of maintaining inventory is to ensure proper supply of goods to
customers.
e)
Spares: The stock policies of spares fifer from industry to industry. Some
industries like transport will require more spares than the other concerns. The costly
spare parts like engines, maintenance spares etc., are not discarded after use,
rather they are kept in ready position for further use.
All decisions about spares are based on the financial cost of inventory on
such spares and the costs that may arise due to their non availability.
BENEFITS OF HOLDING INVENTORIES

Although holding inventories involves blocking of a firms and the costs of
storage and handling, every business enterprise has to be maintain certain level of
inventories of facilitate un interrupted production and smooth running of business.

In the absence of inventories a firm will have to make purchases as soon as it
receives orders. It will mean loss of time and delays in execution of orders which
sometimes may cause loss of customers and business.
A firm also needs to maintain inventories to reduce ordering cost and avail
quantity discounts etc.
There are three main purpose of holding inventories.
1.
The transaction motive: This facilitates continuous production and timely

execution of sales order.
2.
The precautionary motive: Which necessitates the holding of inventories

for meeting the unpredictable changes in demand and supplies of materials
3.
The speculative motive: Which induces to keep inventories for taking

advantage of price fluctuations, saving in reordering costs and quantity
discounts
RISK AND COSTS OF HOLDING INVENTORIES
The holding of inventories involves blocking of firms funds and incurrence of
capital and other costs.

The various costs and risks involved in holding inventories are:
Capital costs: Maintaining of inventories results in blocking of the firms
financial resources. The firm has therefore to arrange for additional funds to meet
the cost of inventories.
The funds may be arranged from own resources or from outsiders. But in both
the cased, the firm incurs a cost. In the former case, there is an opportunity cost of
investment while in the later case; the firm has to pay interest to t he outsiders.
1.
Storage and Handling Costs: Holding of inventories also involves costs on

storage as well as handing of materials. The storage of costs include the
rental of the godown, insurance charges etc.
2.
Risk of Price decline: There is always a risk of reduction in the prices of

inventories by the supplies, competition or general depression in the market.
3.
Risk of Obsolescence: The inventories may become absolute due to

improved technology, changes in requirements, change in customer tastes
etc.
4.
Risk Determination in quality: The quality of materials may also

deteriorate while the inventories are kept.
Objects of Inventory Management

Definition of Inventory Management: Inventory Management is concerned
with the determination of optimum level of investment for each components of
inventory and the operation of an effective control and review of mechanism.
The main objectives of inventory management are operational and financial.
The financial objective means that inventory should not remain idle and
minimum working capital should be locked in it.
The
following
are
the
objectives
of
inventory
management:
1.
To ensure continuous supply of materials, spares and finished goods so that

production should not suffer at any time and the customers demand should
also be met.
2.
To avoid both over stocking and under stocking of inventory.
3.
To maintain investment in inventories at the optimum level as required by the

operational and sales activities.
4.
To keep material cost under control so that they contribute in reducing the
cost of production and overall costs.
5.
To eliminate duplication in ordering or replenishing stocks. This is possible

with the help of centralizing purchases.
6.
To minimize losses through deterioration, pilferages, wastages and damages.
7.
To ensure perpetual inventory control so that materials shown in stock

ledgers should be actually lying in the stores.
8.
To ensure right quality goods at reasonable prices. Suitable quality standards

will ensure proper quality of stocks. The price analysis, the cost analysis and
value analysis will ensure payment of proper prices.
9.
To facilitate furnishing of data for short term and long term planning and
control of inventory.
TOOLS AND TECHNIQUES OF INVENTORY MANAGEMENT
A proper inventory control not only helps in solving the acute problem of
liquidity but also increases profit and causes substantial reduction in the working
capital of the concern.
The
following
are
the
important
tools
and
techniques
of
inventory
management and control.

1.
Determination of stock levels:

Carrying of too much and too little of inventory is detrimental to the firm. If
the inventory level is too little, the firm will face frequent stock outs involving heavy
ordering cost and if the inventory level is too high it will be unnecessary tie up of
capital.
An efficient inventory management requires that a firm should maintain an
optimum level of inventory where inventory costs are the minimum and at the same
time there is no stock out which may result in loss or sale or shortage of production.
a)
Minimum stock level:

It represents the quantity below its stock of any item should not be allowed to
fall.
Lead time: A purchasing firm requires sometime to process the order and
time is also required by the supplying firm to execute the order.
The time in processing the order and then executing it is known as lead time.
Rate of Consumption: It is the average consumption of materials in the
factory. The rate of consumption will be decided on the basis of past experience and
production plans.
Nature of materials: The nature of material also affects the minimum level.
If a material is required only against the special orders of the customer then
minimum stock will not be required for such material.
Minimum stock level can be calculated with the help of following formula.
Minimum stock level Re ordering level (Normal consumption x Normal
re order period)
b)
Re ordering Level:
When the quantity of materials reaches at a certain figure then fresh order is
sent to get materials again. The order is sent before the materials reach minimum
stock level.
Re ordering level is fixed between minimum level maximum level.
c)
Maximum Level:
It is the quantity of materials beyond which a firm should not exceeds its
stocks. If the quantity exceeds maximum level limit then it will be over stocking.
Overstocking will mean blocking of more working capital, more space for
storing the materials, more wastage of materials and more chances of losses from
obsolescence.
Maximum stock level Reordering Level + Reorder Quantity (Maximum
Consumption x Minimum reorder period)
d)
Danger Stock Level:

It is fixed below minimum stock level. The danger stock level indicates
emergency of stock position and urgency of obtaining fresh supply at any cost.
Danger Stock level = Average rate of consumption x emergency delivery
time.
e)
Average Stock Level:

This stock level indicates the average stock held by the concern.
Average stock level = Minimum stock level + x reorder quantity.
2)
Determination of Safety Stocks:
Safety stock is a buffer to meet some unanticipated increase in usage. The

demand for materials may fluctuate and delivery of inventory may also be delayed
in such a situation the firm can be facing a problem of stock out.
In order to protect against the stock out arising out of usage fluctuations,
firms usually maintain some margin of safety stocks.
Two costs are involved in the determination of this stock that is opportunity
cost of stock outs and the carrying costs.
If a firm maintains low level of safety frequent stock outs will occur resulting
into the larger opportunity costs. On the other hand, the larger quantity of safety
stocks involves carrying costs.
3)
Economic Order Quantity (EOQ):

The quantity of material to be ordered at one time is known as economic
ordering quantity.
This quantity is fixed in such a manner as to minimize the cost of ordering
and carrying costs.
Total cost material = Acquisition Cost + Cost + Carrying Costs + Ordering
Cost.
Carrying Cost:
It is the cost of holding the materials in the store.
Ordering Cost:
It is the cost of placing orders for the purchase of materials.
EOQ can be calculated with the help of the following formula
EOQ = 2CO / I
WhereC = Consumption of the material in units during the year
O = Ordering Cost
I = Carrying Cost or Interest payment on the capital.

4)
A B C Analysis: (Always better control analysis):

Under A B C Analysis. The materials are divided into 3 categories viz., A, B
and C.
Almost 10% of the items contribute to 70% of value of consumption and this
category is called A category.
About 20% of the items contribute about 20% of value of category C covers
about 70% of items of materials which contribute only 10% of value of consumption.
5)
VED Analysis: (Vitally Essential Desire)

The VED analysis is used generally for spare parts. Spare parts classified as
Vital (V), Essential (E) and Desirable (D).

The vital spares are a must for running the concern smoothly and these must
be stored adequately. The E type of spares is also necessary but their stocks may
be kept at low figures. The stocking of D type spares may be avoided at times. If
the lead time of these spares is less, then stocking of these spares can be avoided.
6)
Inventory Turnover ratio:

Inventory turnover ratios are calculated to indicate whether inventories have
been used efficiently or not.

The inventory turnover ration also known as stock velocity is normally
calculated as sales / average inventory of cost of goods sold / average inventory.
Inventory conversion period may also be calculated to find the average time
taken for clearing the stocks. Symbolically.
Inventory Turnover Ratio
Cost of goods sold
__________________________
Average inventory at cost
(Or)
Net sales
=
________________________
(Average) Inventory
And,
Inventory conversion period =
Days in a year
______________________
Inventory Turnover ratio
7)
Classification and Codification of Inventories:

The inventories should first be classified can then code numbers should be
assigned for their identification. The identification of short names are useful for
inventory management not only for large concerns but also for small concerns. Lack
of proper classification may also lead to reduction in production.
Generally, materials are classified accordingly to their nature such as
construction
materials,
consumable
stocks,
spares,
lubricants
etc.
After
classification the materials are given code numbers. The coding may be done
alphabetically or numerically. The later method is generally used for coding.
The class of materials is assigned two digits and then two or three digits are
assigned to the categories of items divided into 15 groups. Two numbers will be
category of materials in that class.
The third distinction is needed for the quality of goods and decimals are used
to note this factor.
8)
Valuation of inventories Method of valuation:

FIFO method
LIFO method
Base Stock method
Weighted average price method
CRITERIA FOR JUDGING THE INVENTORY SYSTEM

While the overall objective of the inventory system is to minimize the cost to
the firm at the risk level acceptable to management, the more proximate criteria for
judging the inventory system are:
Comprehensibility
Adaptability
Timeliness
Area of improvement:
Inventory
management
in
India
can
be
improved
in
various
ways.
Improvements could be affected through.

Effective Computerization: Computers should not be used merely for accounting
purpose but also for improving decision making.
Review of Classification: ABC and FSN classification must be periodically reviewed.
Improved
Coordination:
Better
coordination
among
purchase,
production,
marketing and finance departments will be help in achieving greater efficiency in

inventory management.
Development of long term relationship:
Companies should develop long term relationship with vendors. This would
help in improving quality and delivery.
Disposal of obsolete / surplus inventories:
Procedures for disposing obsolete / surplus inventories must be simplified.
Adoption of challenging norms:
Companies should set benchmarks with global competitors and use ideals like
JIT to improve inventory management.
Inventory cost an overall view:
Introduction:
In financial parlance, inventory is defined as the sum of the value of the raw
materials, fuels and lubricants spare parts maintenance consumable semi
processed materials and finished goods stock at any giving point of time. The
operational definition of inventory would be amount of raw materials, fuel and
lubricants, spare parts and semi processed materials to be stock for the smooth
running of the plant / industry.
Need of Inventory:
Inventories are maintained basically for the operational smoothness which
they can be affected by uncoupling successive stages of production, whereas the
monetary value of the inventory serves as a guide to indicate the size of the
investment
made
to
achieve
management departments
this
operational
primary function
convenience.
is to provide
The
materials
this operational
convenience with a minimum possible investment in inventories. Materials

department is accused of both stock outs as well a large investment in inventories.
The solution lies in exercise a selective inventory control and application of
inventory control techniques. Inventories build to act as a cushion between supply
and demand. It is sufficient to take care of the requirements of demand till the next
supply arrives. It is sufficient to take care of probable delays in supply as well as
probable variations in demand.
The size of the inventory depends upon the factors such as size of industry
internal lead time for purchase, suppliers lead time, vendor relations availability of
the materials, annual consumption of the materials. Inventory coat can be
controlled by applying Modern Techniques viz., ABC analysis, SDE, ESN, HMC, VED
etc. These techniques can be used effectively with the help of computerization.
What is meant by inventory cost:

A.
The total value of stores and spares and capital spares.
B.
Stores in transit and under inspection and
C.
Stock of finished products.

Normally, there are certain problems in maintaining optimum level of
inventory. Problems of inventory can be resolved by the cost implications. Costs

which are relevant for consideration are discussed in the following lines;
Basically there are four costs for consideration in developing and inventory model.
1.
The cost of placing a replenishment order.
2.
The cost of carrying inventory.
3.
The cost of under stocking and
4.
The cost of over stocking.

The cost of ordering and inventory carrying cost are viewed as the supply
side costs and help in the determination of the quantity to be ordered for each
replenishment.
The under stocking and over stocking costs are viewed as the demand side
costs and help in the determination of the amount of variations in demand and the
delay in supplies which the inventory should withstand.
Whenever an order placed for stock replenishment, certain costs are
involved, and, for most practical purpose it can be assumed that the cost per order
is constant. The ordering cost may vary depending upon the type of items, for
example raw material like steel against production component like castings in steel
plants, support materials in the case of Steel industry.
The cost ordering includes:
1)
Paper work costs, typing and dispatching an order.
2)
Follow up costs the follow up, the telephones, telex and postal bills etc.,
3)
Costs involved in receiving of the order, inspection, checking and handling

in the stores.
4)
Any set up cost of machines charged by the supplier, either directly

indicated in quotations or assessed through quotations of various
quantities.
5)
The salaries and wages of the purchase department.
Cost of Inventory carrying:

This cost in measured as of the unit cost of the item. This measure gives
basis for estimating what is actually costs a company to carry stock.
This cost includes:
1)
Interest on capital.
2)
Insurance and tax charges.
3)
Storage costs labor costs, provision of storage area and facilities like
bins, racks etc.,
4)
Transport bills and hamali charges.
5)
Allowance for deterioration or spoilages.
6)
Salaries of stores staff.
7)
Obsolescence.
The inventory carrying cost varies and a major portion of this is
Accounted for by the interest on capital.
Under stocking cost:

This cost is the cost incurred when an item is out of stock. It includes cost of
lost production during the period of stock out and the extra cost per unit which
might have to be paid for an emergency purchase.
Over stocking cost:
This cost is the inventory carrying cost (which is calculated per year) for a
specific period of time. The time varies in different contexts it could be the lead
time of procurement of entire life time of machine. In the case of one time
purchases, over cost would be = Purchase Price Scrap Price.
INVENTORY VALUATION AND COST FLOWS:
What is the cost of inventory?

One can readily visualize the determination of inventory quantities by
physical count or by use of perpetual inventory records. When this quantity is
determined, it must be multiplied by a unity cost in order to determine the
inventory value that is used on financial statements.
Trade and quantity discount are to be excluded from unit cost since these
discount exist for the purpose of defining the true invoice cost of merchandise. Cash
discounts, on the other hand, have been considered as a reward for early payment
and as a penalty for late payment. The reward has often been interpreted as a
loss rather than as a part of unit cost. Thus it would not be difficult to find difference
of opinion as to whether invoice cost includes or excludes cash discount.
When the current replaAutomobial cost of material on hand at the close of
a year is less than the actual cost, the inventory value is reduced to
replaAutomobial cost (current market price). Thus the acceptable basis inventory
valuation is the lower of cost or market or more properly the lower of actual cost
or replaAutomobial cost.
The determination of inventory values is very important from the point of
view of the balance sheet and the income statement since costs not included in the
inventory (the balance sheet) are considered to be expensive and are thus included
in the income statement.
Valuation of inventories methods of determination:
Although the prime consideration in the valuation of inventories is cost, there
are a number of generally accepted methods of determining the cost of inventories
at the close of an accounting period. The most commonly used methods are first
in first out (FIFO) average, and last in first out (LIFO). The selection of the
method for determining cost for inventory valuation is important for it has a direct
bearing on the cost of goods sold and consequently on profit. When a method is
selected, it must be used consequently and cannot be changed for year to year in
order to secure the most favorable profit for each year.
THE FIFO METHOD (FIRST IN FIRST OUT METHOD):
Under this method it is assumed that the materials or goods first received are
the first to be issued or sold. Thus, according to this method, the inventory on a
particular date is presumed to be composed of the items which were acquired most
recently.
The value inventory would remain the same even if the perpetual inventory
system is followed.
Advantage:- The FIFO method has the following advantages.
1)
It values stock nearer to current market prices since stock is presumed to

be consisting of
2)
The most recent purchases.
3)
It is based on cost and, therefore, no unrealized profit enters into the

financial accounts of the company.
4)
The method is realistic since it takes into account the normal procedure of
utilizing or selling those materials or goods which have been longer
longest in stock.
Disadvantages:- The method suffers from the following disadvantages.

1)
It involves complicated calculations and hence increases the possibility of

clerical errors.
2)
Comparison between different jobs using the same type of material

becomes sometimes difficult. A job commenced a few minutes after
another job may have to bear an entirely different charge for materials
because the first job completely exhausted the supply of materials of the
particular lot.
The FIFO method of valuation of inventories is particularly suitable in
The following circumstances.

I.
The materials or goods are of a perishable nature.
II.
The frequency of purchases is not large.
III.
There are only moderate fluctuations in the prices of materials or goods

purchased.
IV.
Materials are easily identifiable as belonging to a particular purchase lot.
The LIFO method (Last in First Out method):

This method is based on the assumption that last item of materials or goods
purchased are the first to be issued or sold. Thus, according to this method,
inventory consists of items purchased at the earliest cost.
Advantages: - This method has the following advantages:
1)
It takes into account the current market conditions while valuing materials
issued to different jobs or calculating the cost of goods sold.
2)
The method is base on cost and, therefore, no unrealized profit or loss is

made on account of use of this method.
The method is most suitable for materials which are of bulky and non
Perishable type.
Base Stock Method:
This method is based on the contention that each enterprise maintains at all
times a minimum quantity of materials or finished goods in its stock. This quantity is
termed as base stock. The base stock is always valued at this price and its carried
forward as a fixed asset. Any quantity over and above the base stock is valued in
accordance with any other appropriate method. As this method aims at matching
current costs to current sales, the LIFO method will be most suitable for valuing
stock of materials or finished goods other than the base stock. The base stock
method has advantage of charging out material / goods at actual cost. Its other
merits or demerits will depend on the method which is used for valuing materials
other than the base stock.
Weighted average price method:
This method is based on the presumption that once the materials are put into
a common bin, they lose their identity. Hence, the inventory consists of no specific
batch of goods. The inventory is thus priced on the basis of average priced on the
quantity purchased at each price.
Weighted average price method is very popular on account of its being based
on the total quantity and value of materials purchased besides reducing number of
calculations. As a matter of fact the new average price is to be calculated only when
a fresh purchase of materials is made in place of calculating it every now and then
as is the case with FIFO, LIFO methods. However, in case of this method different
prices of materials are charged from production particularly when the frequency of
purchases and issues/sales in quite large and the concern is following perpetual
inventory system.
Valuation of inventories impact on the flow of costs:
As should be quite evident, the different methods of calculating inventory
values will all have their impact on the flow of costs through the balance sheet into
the income statement. The dollars that are paid to acquire inventory are always
divided between the balance sheet (inventories) and the income statement (cost of
goods sold), there is not other place to put them. Thus if the different methods of
calculating inventory produce differing inventory values, they will also produce
differing cost of goods sold figures, and the differing cost of goods sold figures will
naturally produce differing profit figures.
In order show the impact of inventory valuation on cost flows, the preceding
exhibits are summarized. Each method produces a different figure for the transfer of
raw materials to work in process. These differences appear small, but the only
reason for this is that the dollar amounts have been kept small to make the
illustration workable.
Evaluation of methods What causes the differences?
The differences in inventory values and flows for each of the method
illustrated result from only one factor, that it, changing purchases prices or unit
costs. If purchase prices had remained stable or unchanged, each method would
have produced the same inventory value and cost flow.
Cost flows and inventory are exactly the some under stable prices. With a
falling price level, the LIFO method produces the highest cost flow and the lowest
inventory. With a falling price level, the LIFO method produces the lowest cost flow
and highest inventory. The cost flow under LIFO follows the price level, LIFO
produces larger cost flows when prices are rising and smaller cost flows when prices
are falling. A final item to consider is that the average method produces results
which fall between the extremes of LIFO and FIFO.
Evaluation of methods can we justify the differences?

The best method of inventory valuation might be specific identification, that
is, the units in inventory should be identified with the specific invoices and thus
specific unit costs to which they apply.
Fortunately, the FIFO method constitutes a very useful approximation to the
specific identification method if one can reasonably assume that the actual flow of
materials is first-in first-out. This assumption is not unreasonable and thus we have
stated the main argument for the FIFO inventory scheme, that is, the physical flow
of materials would match the flow of costs under the first in first out method.
When the units in inventory are identical, interchangeable and do not follow
any specific pattern of physical flow, the average cost system would seen to
appropriate.
The primary difference between the FIFO and average methods is centered
on the physical flow since both methods could involve identical and interchangeable
units. The FIFO method fits a first-in first-out physical flow. The average method fits
a system which has no specific pattern of physical flow. Finding a situation where
there is no specific pattern of physical flow should be quite difficult because of the
fact that most inventory items are subject to deterioration by instituting a person
would attempt to reduce such deterioration and any reasonable person would
attempt to reduce such deterioration by instituting a physical flow approximating
first-in-first-out. The major reason for the use of the average method is something
other than the lack of specific physical flow.
Ordinarily the LIFO method cannot be justified on the basis of the physical
flow of materials. Under conditions of changing prices, the advocate of LIFO says
that the only method which matches costs and revenues is the LIFO method. The
LIFO method assumes that the latest item is the first item out, and thus the current
costs of materials are matched with the other hand, assumes that the first item in is
the first item out, and thus the non-current costs of matching current costs with
current revenues is the essence of the argument for the LIFO method.
Inventories valued at standard cost:
A very useful method of valuing inventories is at a standard cost. With a
standard cost system is no need of spending a great deal of time and money tracing
unit cost through perpetual inventory record.
PERPETUAL INVENTORY CARD UNDER A STANDARD COST

SYSTEM
Perpetual inventory Plant: Standard cost:
Location: Order Quantity:.....

Order Point:
..
Date
Description
On order
Receive
d
Available
Issued
On
order
On hand
As shown above, there is need only for physical quantities since the inventory
values is the physical quantity multiplied by the standard cost. With the cost and
value columns disposed off, a perpetual inventory card can include additional data
such as quantities on order, quantities reserved, and quantities available. These

additional data are very useful for inventory and production control purpose. On the
basis of a few calculations concerning into inventories on a FIFO, a LIFO, or an
average cost basis.
Inventory of Obsolescence:
Absolvent inventories cannot be used or disposed off at values carried on the
books. Frequent reviews should be made of all inventories, and when obsolescence
is indicated a request for revaluation should be prepared for approval by
management. The difference between original and obsolete value should be
recorded by a change to operating account. Inventory obsolescence, and a credit to
inventory. If the material is scrapped, this will be for the full inventory value or used
in areas where it will be work less than its
Original value, the entry would be only for the amount of write down. Some
companies carry a solvage inventory and transfer to it materials which may be sold
or used at reduced values. Where this is done, the entry would be:
Dr. Inventory Obsolescences. Raw Material inventory or Supplies inventory.
Inventory cost in relation Hero MotoCorp Ltd shall to classifieds follows:

Inventory can be classified as capital and revenue certain items through titled
as capital in nature. Hence, due care is to be take whole drawing the material.
Materials which are to be imported from other countries have to be planned
well in advance nearly about 24 months are to initiate the proposals for
procurement.
Similarly some of the items do not require any lead time some they are
available in the local market.
Automobile is highly energy intensive industry, the inputs like power and
Steel are the major part of the variable cost since Government controls the Steel &
fuel sector, and increase is rates adversely effects the Automobile industry.
Hero MotoCorp Ltd has it own power plant and through which it saves energy
consumption. By this the cost since Government controls the Steel & fuel sector,
any increase rates adversely effects the Automobile industry.
Inventory cost of any organization also adversely affects by retaining
obsolete / scraps and inventory costs can be reduced by management with an
advance planning of procurement of materials, periodical reviews of existing spares
with reference to the fast consumption, ascertaining the information regarding the
availability of spares in other areas. Holding of extra inventory will be an additional
financial burden to the company due to payment of interest charges on the
materials purchased, diminishing value of materials purchased, diminishing value of
materials by keeping them in stores for a log time, handling charges, spare rent
etc.,
Automobile factory runs with various equipments:
i.
ii.
technical department
1.
Store
2.
Mechanical
3.
Electrical
4.
Civil
Commercial departments
1.
stores
2.
purchase
3.
accounts
To run the plant and maintain equipments departments require spares. for such
requirement of spares departments raise indents and send the indents to purchase
department through stores.
Indents:
1)
Annual indents for consumable items (stores items).
2)
Regular indents raised by consuming departments.
3)
Annual requirement of raw materials promo & QC.
Enquiries:
1)
Enquires will be sent approved sun contractors.
Order processing form:

1)
Receiving quotations from sub contractors.
2)
Enter the price details of enquiry sent in the

Order processing form.
4)
Selection of party on merit basis.
Purchase order:
1)
Prepare purchase order on selected party.
2)
Send purchase order copies to party, stores and

Departments.
Goods receipt note:

1)
Receiving goods receipt note from stores.
Purchase department:
Activity receiving indents:
Flow chart:
Receipt of annual indents for consumable items / stores items from stores
department.
Checking
of
indent
number
an
authority
of
item,
delivery
time
consumption period.
In case of any deficiency, send the information to concerned department
for clarification.
Segregation of indents for attending at C.P.D. and Hyderabad Office.
Sent the Hyderabad indents to Hyderabad Office.
Enter the indents details in indent register.
PURCHASE DEPARTMENT
PURCHASE ENQUIRY
Ms.
Sl.
Material
Departm
Quantit
No.
Code
ent
Unit
When
Required
ACTIVITY: FLOATING ENQUIRIES:

FLOW CHART:
Checking indented items and equipment name.
Taking previous suppliers information from previous supply. If new

equipment / item, information to be taken from concerned department or
from competitors / journals / yellow pages.
Prepare enquiry to approved sub contractors through enquiry format.
If emergency requirement, send the enquiries through fax / e-mail.
Enter the details of enquiries sent in order processing form.
PURCHASE DEPARTMENT
ORDER PROCESSING FORM
Sl.
Inde
No
nt
Ref
Materi
al
Descripti
Siz
Qt
Code
on
1 2 3 4 5 6
Remar
ks
No.
ACTIVITY: PREPARATION OF ORDER PROCESSING FROM

FLOW CHART:
Receiving quotation against enquiries sent.
Enter price and other of the quotation received from sub contractors in
the order processing from.
Mention the earlier purchase details of indented items against each item
in the order processing form if available.
Put up the processing from with enquiry and quotations to head

(purchase).
Examine order processing from with decide the sub contractor to whom
purchase order to be placed.
PURCHASE DEPARTMENT
PURCHASE ORDER
Sl.
Inden
Item
Descrip
No.
t No.
Code
tion
Qty
Rate
Unit
Amou
nt
ACTIVITY: PREPARATION OF PURCHASE ORDER

FLOW CHART:
Prepare purchase order after finalization of price and other technical terms
mentioning the following details.
1. Material code
2. Indent number
3. Material specification & part number
4. Quantity
5. Rate
6. Payment and other terms & conditions
Stipulation of terms of test certificate / ibr / manufactures certificate

where applicable.
Fill in and attach the purchase order review proforma to purchase order.
Send the prepared purchase order to head (purchase) and competent

authority for approval.
Send the purchase order to identified approved sub contractor.
Send the purchase order copies to store and concerned departments.
Enter the details of purchase order in purchase order register.
PURCHASE DEPARTMENT
AMENDMENT / CANCELLATION OF ORDER
Material Code
Material
Price /
Amended
Quantity as
Price /
per Order
Quantity
ACTIVITY: ORDER AMENDMENT, ORDER FOLLOW UP AND INFORM THE

SUPPLIER FOR THE REJECTIONS / DAMAGES / SHORTAGES:
FLOW CHART:
Issue of amendments in case of modification to purchase order.
Review the pending order and follow up the pending order for breakdown
requirement.
Send regular reminders to suppliers against pending purchase order every

month.
Receive shortage / excess / damages report from stores for the material
received.
Information the supplier for the rejections / damage / excess / shortage.
PURCHASE DEPARTMENT
ACTIVITY: IMPORTS:
FLOW CHART:
Receipt of indents for import items from stores department.
Taking previous / item, information to be taken from concerned

department or from competitors / journals / Yellow pages.
Send enquiry to overseas supplier.
Receiving quotations against enquiries sent.
Enter price and other terms of the quotations received from overseas
supplier in the order processing form.
1) Material code
2) Indent number
3) Material specification & part number
4) Quantity
5) Rate
6) Payment
7) Insurance and other terms and conditions.

Send the purchase order to overseas supplier.
Send the purchase order copies to stores and concerned departments.
Prepare IC documents and submit to bank for onward transmission to

overseas supplier.
Receive shipping documents from overseas supplier and send same to

clearing agents for collection of the material.
STORES DEPARTMENT
ACTIVITY: RECEIPTS AND UNLOADING MATERIAL
Receiving of Goods through Trunk / Personnel Delivery.
Entry of vehicle at Gate Office.
Stamping on Dispatch Advise / Delivery challan by Gate Office.
Checking of challans / Dispatch Advise with purchase order.
Unloading of Goods at allotted place or in case of urgency direct at works

site.
All safety precautions are taken while unloading of material like workers
should wear safety shoes, helmets, leather head gloves, noise respirator,
nose mask.
STORES DEPARTMENT
Activity: preparation of receipt and approval book for general material / d.c. enter of
block, repair and stationary material manually in register
Sorting of Delivery challans as below:

a) General
b) Stationery
c) Repairs
d) Block
Checking with P.O. and mentioning Material Code, Party Code, Indent No.
Department Name on each & every challans.
Creation of D.C. entry in system for general materials.
Preparation of identification tags for General Materials through system.
Preparation of Receipt & Approval Book for General materials.
Manual entry of block, stationery, repairs materials.
Preparation of intimations for block, stationery, repairs materials.
STORES DEPARTMENT
ACTIVITY: PHYSICAL VERIFCATION OF GOODS:
All D.C. handed over to stores assistant physical verification like

measuring, counting and tallying with D.C.s Quantity / Description of the
materials by the Stores Assistant.
Identification tags to be attached to the verified material. Shortage /

Excess / Damages if any found to be noted on challans and inform to
section incharge.
Preparation of Shortage / Excess / Reports if any sending to parties under

copy to purchase / bills sections.
STORES DEPARTMENT
ACTIVITY: APPROVAL OF MATERIAL AND PREPARATION OF GOODS RECEIPT
NOTES:
Intimation is be sent to all the concerned departments. Showing materials

to concern person.
Taking approval of the material in receipt & approval book.
Preparation general material in receipt & approval book.
Preparation general material GRNs through system and stationery /

block / repairs GRNs manually.
STORES DEPARTMENT
ACTIVITY: REJECTED MATERIALS
Rejected materials kept in allotted area of rejected materials.
Packing of rejected materials.
Preparation of gate passes for rejected materials.
Sending back to suppliers through our Hyderabad Office.
Sending consignee copy to party vides Register Letter for booking of

Register goods to partys other than.
STORES DEPARTMENT
ACTIVITY: EXCISE GATE PASSES
Sending duplicate for transport copy of excise invoice from suppliers

delivery challans.
Mentioning A.B. Sl. No. and named of concerned department.
Duplicate for transport copy of excise invoice over to bills section for
sending the same to Excise Department.
Corresponding with supplier. If the Excise Invoice is not found with delivery
challans.
CHAPTER-IV
DATA ANALYSES AND INTERPRETATIO

The investment on raw materials over a period of 5 years from 2010 to 2014 is
presented in the following table.
1.
Investment on Raw Materials:

Year
Investment on Raw Material

(in crores)
2009 2010
3925.71
2010 2011
5128.75
2011 - 2012
3964.26
2012 - 2013
3623.83
2013 2014
4088.77
(in crores)
6000
5000
4000
Investment on Raw
Material
(in
crores)
3000
2000
1000
20
14
20
13
-2
01
3
20
12
20
11
-2
01
2
20
11
20
10
20
09
20
10
Interpretation:
1)
From the above table it can be understood that the inventory of was recorded
at 4088.77 during the year 2013 14 and it is decreased to 3964.26 during
the year 2012 13.
2)
It shows that there is on decrease in the inventory to the more extent of

4088.77.
3)
The average inventory of HERO MotoCorp was recorded at Rs.4088.77.
4)
The highest investment in inventory was recorded in the years 2010-11.
2.
Trend Analysis:
Trend analysis technique is applied to know the growth rate in investment of
raw material of Hero MotoCorp Ltd over the review period which is shown in the
following table.
Trend Analysis:
Year
Raw Material (in Lacks)
Trend %
2009 2010
436.40
100
2010 2011
524.93
120.286434
2011 - 2012
675.57
128.69716
2012 2013
636.76
94.2552215
2013 2014
669.55
105.149507
Trend %
140
120
100
80
60
40
20
0
20
14
20
13
20
13
20
12
-2
01
2
20
11
20
11
20
10
20
09
20
10
Trend %
Interpretation:
1)
The investment on inventory has increased in the year 2013 14. And the
lost year investment has declared continuously. The percentage in 2009 10
was 105.14 % as compared to years 2009 10 to 2013 14.
2)
The trends in inventories show that inventory have been more in the year
2011 12 and then it has shown a downward trend and again it increased to
some extent.
3)
The investment in inventories has shown fluctuating trend is initial years and
then it rose to 109.67 % and again showing fluctuating trend.
3.
Inventory Turnover Ratio:

This ratio indicates the number of times the stock has been turned over
during the period & evaluates the efficiency with which a firm is able to manage its
inventory. This ration is calculated by applying the following formula.
Cost of goods sold
Inventor turn over ration
_________________
Average inventory
Inventory turn over ration:
Year
Cost of goods
Avg.
sold
Inventory
Ratio
2009 2010
13084.39
436.40
29.9825619
2010 2011
16796.90
524.93
31.9983617
2011 - 2012
20032.81
675.57
29.6531966
2012 2013
20446.16
636.76
32.1096802
2013 2014
21727.05
669.55
32.4502277
Ratio
33
32.5
32
31.5
31
30.5
30
29.5
29
28.5
28
20
14
20
13
20
13
20
12
-2
01
2
20
11
20
11
20
10
20
09
20
10
Ratio
Interpretation:
1.
From the above table it can be observed that inventory turnover ratio is 29.98
in the year 2009-10 and it gradually increased to 32.45 during 2013 2014.
2.
In the year 2011 12 it is clear that the ratio is very less i.e., his stock
Is not turned into sales quickly.
3.
As compared to all the years the ratio is very less in 2011 12.
4.
The average inventory turn over ratio was recorded at 31.23 times during the
review period.
4.
Inventory conversion period:
It may also be of interest to see average time taken for clearing the stocks.
This can be possible by calculating inventory conversion period. This period is
calculated by dividing the number of the days by inventory turns over.
This formula may be as:
Days in a year (360 days)
_____________________
Inventory turnover ratio
Inventory conversion period: (in crores)

Year
2009
Cost of goods
Avg.
sold
inventory
13084.39
2010
2010
16796.90
2011
2011 -
20032.81
2012
2012
20446.16
2013
2013
2014
436.40
524.93
675.57
636.76
Ratio
ICP (Days)
29.9825619
12.0069793
31.9983617
11.250576
29.6531966
12.1403437
32.1096802
11.2118097
32.4502277
11.0939907
21727.1
669.55
ICP (Days)
12.4
12.2
12
11.8
11.6
11.4
11.2
11
10.8
10.6
10.4
20
14
20
13
20
13
20
12
-2
01
2
20
11
20
11
20
10
20
09
20
10
ICP (Days)
Interpretation:
From the above table it can be identified the following observations:
1)
The inventory conversion period was 11.09 days during the year, which
indicates that the stock has been very quickly converted into sales which
mean the company is managing the inventory efficiently.
2)
The lowest inventory conversion period was recorded at 11.9 days in the year
2013 14 and the highest inventory conversion was recorded at 12.14 days
in the year 2011 12.
3)
The average inventory conversion period was recorded at 10.2 days during
the review period.
5.
Percentage of Inventory over current assets:

In order to know the percentage of inventory over current assets the
Ratio of inventory to current assets is calculated and which is presented in the

Following table.
Inventory
Inventory over current assets ratio
__________ X 100
Current assets
Percentage of Inventory Over current assets:
Year
Inventory
Current
Assets
Ratio (%)
2009 2010
436.40
2890.46
15.0979429
2010 2011
524.93
1510.52
34.7516087
2011-2012
675.57
1951.69
34.6146161
2012 2013
636.76
2884.75
22.0733165
2013 2014
669.55
2911.17
22.9993439
Ratio (%)
40
35
30
25
20
15
10
5
0
20
14
20
13
20
13
20
12
20
12
20
11
-
20
11
20
10
20
09
20
10
Ratio (%)
Interpretation:
1)
From the above table it can be understand that the 22.99 % of inventory over
current assets ratio was showing a inclining trend for two years 2013 2014.
2)
However from the year 2011 12 it is showing an increasing trend.
3)
The lowest inventory over current assets ratio was recorded at 15% during
the year 2009 10 and the highest inventory over current assets ratio we
recorded at 34.75 % during 2010-2011.
4)
The average inventory over current assets ratio was recorded at 22.99 %.
7. Percent of Inventory Over total current assets & fixed assets:

Inventory / Current + Fixed assets
Year
Inventory
Current Assets+ Fixed

assets
Ratio (%)
2009 2010
436.40
3531.05
12.3589301
2010 2011
524.93
4447.22
11.8035537
2011 - 2012
675.57
5284.68
12.7835555
2012 2013
636.76
5308.40
11.9975882
2013 2014
669.55
5599.87
11.9565275
Ratio (%)
13
12.8
12.6
12.4
12.2
12
11.8
11.6
11.4
11.2
20
14
20
13
20
13
20
12
-2
01
2
20
11
20
11
20
10
20
09
20
10
Ratio (%)
Interpretation:
1)
From the year 2009-10 it is showing fluctuating trend but as compared

to above 2 years it is increasing.
2)
The lowest inventory over total assets ratio was recorded at 11.59%
during the year 2013-14 and the highest inventory ratio was recorded
at 12.18 % during the year average.
3)
The average inventory to total assets ration was recorded at 11.59 %

during the review period
7.
Percentage of Inventory over current liabilities:

In order to know the percentage of inventory over current liabilities the
Ration of inventory to current liabilities is calculated and which is presented in

The following table.
Inventory
Inventory over current liabilities ratio
= __________________ X 100
Current liabilities
Percentage of Inventory Over current liabilities:
Current
Year
Inventory
2009 2010
436.40
4992.04
8.74191713
2010 2011
524.93
6397.47
8.2052749
2011- 2012
675.57
4610.73
14.6521267
2012 2013
636.76
4333.25
14.6947441
2013 - 2014
669.55
4497.43
14.8873912
liabilities
Ratio (%)
Ratio (%)
16
14
12
10
8
6
4
2
0
-2
01
4
20
13
20
13
20
12
20
12
20
11
-
20
11
20
10
20
09
20
10
Ratio (%)
Interpretation:
1)
From the above table it can be understand that the % inventory over current
liabilities ratio was showing a declining trend for two years 2010-14.
2)
During the year 2010-11 the ratio was it gradually decreased to 8.20 and
there is a net increase to the extent of 12.45.
3)
The lowest inventory over total amounts ratio was recorded at 8.20 during
the year 2010-11.
4)
The highest inventory to current liabilities ratio was recorded at 14.88 during
the year 2013-14.
5)
The average inventory to current liabilities ratio was recorded at 14.88 during
the review period.
8.
Current Ratio:
In order to know the current ratio the percentage of current assets to current
liabilities is calculated and which is presented in the following table.
Current assets
Current Ratio
= _____________________
Current liabilities
Calculation of Current Ratios:

Current
Current
assets
liabilities
2009 2010
2890.46
4992.04
0.57901379
2010 2011
1510.52
6397.47
0.23611209
2011- 2012
1951.69
4610.73
0.42329306
2012 2013
2884.75
4333.25
0.66572434
2013 - 2014
2911.17
4497.43
0.64729634
Year
Ratio (%)
Ratio (%)
0.8
0.6
0.4
0.2
0
Interpretation:
-2
01
4
20
13
20
12
20
13
20
12
20
11
-
20
11
20
10
20
09
20
10
Ratio (%)
1)
From the above table it can be interpreted that the % of current assets
over current liabilities ratio i.e., current ratio was showing a fluxuation
trend from year 2010-2014.
2)
In the year 2009-2010 the ratio was 0.57 % and has increased to 0.64 %
in the year 2013-2014.
3)
The lowest current ratio was recorded at 2010-11 which is 0.23 % and the
highest current ratio was recorded at 0.57 % during the year 2009-10.
4)
The average current ratio was recorded at 0.54 % during the review
period.
9.
Quick Ratio:
The quick ratio is the relationship between quick to current liabilities quick
assets is more rigorous test of liability position of a firm it is computed by applying

the following formula.
Quick ratio =
Quick assets / Current Liabilities
Where Quick assets = Current Assets Inventory
Year
Quick assets
Current
liabilities
Ratio (%)
2009 2010
2454.06
4992.04
0.49159462
2010 2011
985.59
6397.47
0.15405934
2011- 2012
1276.12
4610.73
0.27677179
2012 2013
2247.99
4333.25
0.51877689
2013 2014
2241.62
4497.43
0.49842243
Ratio (%)
0.6
0.5
0.4
0.3
Ratio (%)
0.2
0.1
20
14
20
13
20
12
20
13
20
12
20
11
-
20
11
20
10
20
09
20
10
Interpretation:
1)
From the above table it can be understand as that the % of quick assets to
current liabilities i.e., the quick ratio was 0.49 % in 2009-10 and from that
year it is showing increasing trend.
2)
The highest quick ratio was recorded at 0.51 % during the year 2012-13
and the lowest quick ratio was recorded at 0.15 % during the year 201011.
3)
The average quick ratio was recorded at 0.49 % during the review period.
ABC ANALYSIS FOR THE YEAR 2009-10:

ITEM
RANK
ANNUAL
CUMULATIVE
CUMULATIVE
CONSUMPTION USAGE
PERCENTAGE
(RS/Cr)
(Cr)
OF USAGE
25983
25983
40.43
16727
42710
66.47
FINISHED GOODS
10679
53389
83.09
MATERIAL IN
4719
58108
90.43
1187
59295
92.30
3045
62340
97.02
1806
64146
99.83
108
64254
100.00
WORK IN
PROGRESS
RAW
MATERIALS
TRANSIT
INDIRECT
MATERIAL
MATERIAL WITH
FABRICATION
TRANSFER IN
TRANSIT
SCRAP ARISE &
OTHERS
A Occupies 70% of annual consumption value i.e., 70% of 64254 is 44977.80

A + B Occupies 90% of annual consumption value i.e., 90% of 64254 is 57828.60
Actual Value of A = 42710/64254*100 = 66.47%
B = 23.96% & C = 9.57%
RANKS
% CHANGE
97.0299.83 100
83.0990.4392.3
66.47
40.43
SI
T
TR
AN
O
TH
ER
S
FI
N
IS
H
ED
FA
BR
IC
AT
IO
N
M
AT
ER
IA
L
TR
AN
SI
T
G
O
O
D
S
RA
W
W
O
RK
IN
AB
C ANALYSES FOR 2009-10
INTERPRETATION
Now we conclude that Class A occupies 55.01% of total values of them,

therefore items work in progress, raw materials and finished goods are comes underclass
A category and Class B occupies 37.47%after the class A percentage therefore item
material in transit comes under class B category, and lastly Class C occupies 7.57% with
items indirect material, material with fabrication, transfer in transit, scraps and others.

ITEM
RANK
ANNUAL
CUMULATIVE
CUMULATIVE
CONSUMPTION USAGE
PERCENTAGE
(RS/Cr)
(Cr)
OF USAGE
29148
29148
38.61
19656
48804
64.65
FINISHED GOODS
13017
61821
81.89
MATERIAL IN
5038
66859
88.56
1286
68145
90.27
4963
73108
96.84
2107
75215
99.63
WORK IN
PROGRESS
RAW
MATERIALS
TRANSIT
INDIRECT
MATERIAL
MATERIAL WITH
FABRICATION
TRANSFER IN
TRANSIT
SCRAP ARISE &
278
75493
100.00
OTHERS

Actual Value of A = 61821/75493*100 = 81.89%
B = 8.38%
C = 9.73%
RANKS
81.89
88.56 90.27
% CHANGE
96.84 99.63 100
64.65
38.61
O
TH
ER
S
SI
T
TR
AN
FA
BR
IC
AT
IO
N
SI
T
8
M
AT
ER
IA
L
IS
H
ED
G
O
O
D
S
TR
AN
3
RA
W
FI
N
W
O
RK
IN
ABC
ANALYSES FOR 2010-11
INTERPRETATION

ITEM
RANK
ANNUAL
CUMULATIVE
CUMULATIVE
CONSUMPTION USAGE
PERCENTAGE
(RS/Cr)
(Cr)
OF USAGE
33123
33123
40.65
21772
54895
67.38
FINISHED GOODS
4190
59085
72.52
MATERIAL IN
9198
68283
83.81
1546
69829
85.70
7968
77797
95.48
3379
81176
99.63
300
81476
100.00
WORK IN
PROGRESS
RAW
MATERIALS
TRANSIT
INDIRECT
MATERIAL
MATERIAL WITH
FABRICATION
TRANSFER IN
TRANSIT
SCRAP ARISE &
OTHERS

Actual Value of A = 59085/81476*100 = 72.52%
B = 22.96%
C = 4.52%
ABC ANALYSES FOR 2011-12

RANKS
67.38 72.52
83.81 85.7
% CHANGE
95.48 99.63 100
40.65
O
TH
ER
S
SI
T
TR
AN
SI
T
8
FA
BR
IC
AT
IO
N
M
AT
ER
IA
L
IS
H
ED
G
O
O
D
S
TR
AN
3
RA
W
FI
N
W
O
RK
IN
INTERPRETATION
material in transit comes under class B category, and lastly Class C occupies 4.51 % with

ITEM
WORK IN
RANK
ANNUAL
CUMULATIVE
CUMULATIVE
CONSUMPTION USAGE
PERCENTAGE
(RS/LAKHS)
(RS)
OF USAGE
25814
25814
35.46
11646
42458
58.33
15320
57778
79.37
10262
68040
93.47
1317
69357
95.28
1279
70654
97.06
PROGRESS
RAW
MATERIALS
FINISHED
GOODS
MATERIAL
IN TRANSIT
INDIRECT
MATERIAL
MATERIAL
WITH
FABRICATION
TRANSFER IN 7
2029
72683
99.85
111
72794
100.00
TRANSIT
SCRAPS ARIS 8
& OTHERS
A Occupies 70% annual consumption value i.e., 70% of 72794 = 50955.8

A + B Occupies 90% annual consumption value i.e., 90% of 72794 = 65514.6
Actual Value of A = 57778/72794*100
= 79.37%
B = 14.10%
C = 6.53%
ABC Analysis 2012-2013
100
90
80
70
60
50
40
RANKS
30
% CHANGE
20
10
O
TH
ER
S
SI
T
&
TR
AN
M
AT
ER
IA
L
IN
D
IR
EC
T
M
AT
ER
IA
L
FA
BR
IC
AT
IO
N
IS
H
ED
FI
N
RA
W
W
O
RK
IN
INTERPRETATION
A category and Class B occupies 14.10 after the class A percentage therefore item
items indirect material, material with fabrication, transfer in transit, scraps and others
ABC ANALYSIS FOR THE YEAR 2013-14

ITEM
RANK
WORK IN
ANNUAL
CONSUMPTIONUSAGE
PERCENTAGE
(RS/LAKHS)
OF USAGE
FINISHED GOODS
669.55
MATERIAL IN
15560
TRANSIT
5
OTHERS
47.67052
19844.12
49.33511
35404.12
88.01933
36628.12
91.06235
38195.12
94.95812
40135.12
99.78122
40223.12
100
1940
TRANSIT
SCRAP ARISE &
19174.57
1567
FABRICATION
TRANSFER IN
2.123431
1224
MATERIAL
MATERIAL WITH
854.11
18320.46
MATERIALS
INDIRECT
(RS)
854.11
PROGRESS
RAW
CUMULATIVE CUMULATIVE
88
A Occupies 70% of annual consumption value i.e., 70% of 40223.12 is 28156.18

A + B Occupies 90% of annual consumption value i.e., 90% of 40223.12 is 36200.80
Actual Value of A = 28156.18/40223.12*100 = 69.99%
B = 24.42%
C = 5.59%
45000
40000
35000
30000
25000
RANK
ANNUAL CONSUMPTION
(RS/LAKHS)
20000
CUMULATIVE USAGE (RS)

15000
CUMULATIVE PERCENTAGE
OF USAGE
10000
5000
SI
T
TR
AN
M
AT
ER
IA
L
G
O
O
D
S
IS
H
ED
FI
N
W
O
RK
IN
INTERPRETATION
Now we conclude that Class A occupies 69.99% of total values of them, therefore
items work in progress, raw materials and finished goods are comes underclass A category
and Class B occupies 24.56%after the class A percentage therefore item material in
transit comes under class B category, and lastly Class C occupies 5.58% with items
indirect material, material with fabrication, transfer in transit, scraps and others.
CHAPTER-V
FINDINGS
SUGGESSIONS
CONCLUSIONS
BIBLIOGRAPHY
FINDINGS
Over all the inventory of Hero MotoCorp Ltd is up to the mark.
The production during 2013-14 was 21727.05 and 20446.16 respectively

which is higher as compared to 2012-2013 which is 23586.80 and
25252.98.
Investment on raw material in 2011-2012 is 3623.83 Cr which very high as

compared to 2012-13 which is only 3964.26 Cr.
The inventory turn over ratio shows that the stock has been converted
into sales is only 1.01 times.
In the year 2009-10 the stock was cleared within 11.02 days whereas it
took 12.73 days in the year 2012-2013 which took more days for clearing
stock.
Year 2013-14 is not showing sample profits. This is because of Iron prices
have been continuously under pressure due to persistent mismatch
between supply and demand.
.
SUGGESTIONS
Though the production is higher is the year 2009-2010 and the sales were
very high i.e., as per inventory conversion period it took 11.01 days. This
shows that there is demand for Automobile and the funds unnecessarily tied
up. So, proper demand forecasting should be done and according to that it
may be manufactured.
The investment on raw material should be made as per the requirement.

Unnecessary investment may block up the funds.
Neither too high nor too low inventory turnover ratios may reduce profit and
liquidity position of the industry. So, proper balance should be made to
increase profits and to ensure liquidity.
The raw material should be acquired from the right source at right quality and
at right cost.
CONCLUSION
Today business scenario inventory management is becoming very

crucial part of the organization.
The system of inventory management in Hero MotoCorp Ltd very

effective. The organization is basically and assembling unit and thus
inventory place a most significant role in the decision making process.
From the various calculations and figures relating to inventory

management it is clear that the inventory classification of A items are
maintain for days, as a result it reduce investment in raw material,
reducing the lead time and also the large quantity discount because
the stock are kept for days.
In the classification of ABC items procedure is following in Hero

MotoCorp Ltd has launched the different type of card system for class
C items.
Class A & B items are consider under the just in time philosophy as the
procurement time has been reduced up to greater extent by the proper
co-ordination of buyer and supplier.
There is great improvement in the inventory turnover ratio from 3

years. It is increased from 5.98 to 7.24% this position indicates that
the stocks are fast moving and get converted into sales quickly in
Hero MotoCorp Ltd,
Finally we conclude that Hero MotoCorp Ltd the inventory system is

very good with high techniques.
BIBLIOGRAPHY
1.
Financial Management
By I.M Pandey
2.
By Prasanna Chandra
3.
Total Quality Management
By K. Shridhara Bai
4.
Management Accounting
R.K.Sharma &S.KGuptha
WEBSITES:
www.google.com
www.heromoto.com
www.indiancompanys.com
www.automobilsindia.com
Table Content
Chapte
r
Title
Page No
1-5
Introduction
Objectives Of The Study
I
Need Of The Study

Methodology Of The Study
Limitations Of The Study
II
Review Of Literature
6-27
Research Studies
Stock Markets
III
Company Profile
28-36
IV
Data Analysis And Interpretation
37-44
Findings
45-46
VI
Suggestions
47-48
VII
Conclusions
49-50
VIII
Bibliography
51-52
CHAPTER-I
INTRODUCTION
Introduction
Objective of the study
Need and scope of the study
Methodology of the study
Limitations
INTRODUCTION
Stock Market integration is generally perceived as a real barometer for the economic growth.
This integration is because of globalization and liberalization. With financial integration,
emerging economies have become increasing attractive place for the portfolio investors who
generally seek marginal amount of return than what available in other developed countries. There
are several benefits associated with financial integration such as real price discovery, market
efficiency, higher savings and investments, low transaction costs and that would lead to overall
economic development.
The correlation between the returns for different markets is the core indicator to measure the
influence of portfolio risk Markowitz (1952). According to the portfolio theory, assets with low
correlation between their returns significantly enhance the risk-adjusted return of the portfolio.
Thus diversifying the investments in the emerging market will give scope to reduce unsystematic
risk or to improve the marginal returns. If all markets are highly correlated then the crash in one
market will ripple to other markets too. In January 2008, national stock markets declined sharply
due to credit market developments in the United States.
India has the distinction of having the second largest number of listed companies after the USA.
Number of firms in emerging markets now cross-list on international exchanges to get benefit of
lower cost of capital and more liquidity-traded shares. There are some debates whether stock
market integration brought economic development or will cause economic disruptions. This issue
had been extensively studied nearly four decades ago by Shaw (1973) and McKinnon (1973), wh
oresulted in significant evidence that financial development
promotes economic growth, mainly through a raise in the level of saving and investment. The
returns of domestic and foreign markets are less than perfectly correlated. This indicates higher
the correlation, higher chances of co-movement and vice versa. The modern portfolio theory
elicits the integration and interdependence which focuses the issue of diversifying assets. The
advantages of assetdiversification have extensively discussed in the literature
[see Grubel (1968), Lessard (1973),Agmon and Lessard (1977), Solnik
(1991)].
There have been numerous reasons forwarded for rapid growth in some of the selected countries.
Firstly, Governments in less developed and emerging countries have become more liberal in
adopting market-oriented reforms geared to privatize previously public enterprises such as
transport and communications and public utilities; secondly financial sectors in these countries
have been opened to foreign private sector investment; thirdly, the corporate sectors are
now becoming increasingly competitive in these countries, even on an international level; state
owned enterprises continue to become more privatized, paving the way for shares being
distributed amongst a wider span of the population. The objective of this paper is to study comovement of Indian stock markets index with developed as well as developing countries stock
market indices.
In investigating these issues, we take Nifty index as the core barometer of the Indian
stock market as it captures the major chunk of Indian stock market. On the other hand, the other
stock markets are selected based on Indias significant trade and financial relations with foreign
countries. We have selected stock markets of India, China, U.S, U.K, Hong Kong, Japan,
Germany, and Australia as a developed market.
SELECTED STOCK MARKETS AND THEIR INDEX:
COUNTRY
STOCK MARKET
INDICES
ABBREVIATI
ON
INDIA
National Stock Exchange
NIFTY
NIFTY
CHINA
Shanghai composite Index
SCI
SCI
U.S
NASDAQ
NASDAQ
U.K
Financial Time Stock Exchange
FTSE
FTSE
GERMANY
Deutrcher Aktien Index
DAX
DAX
FRANCE
CAC
CAC
JAPAN
Tokyo Stock Exchange
NIKKIE
NIKKIE
HONG KONG
Hong Kong Stock Index
Hangseng
HANGSENG
NEED FOR THE STUDY:

Presently, the fluctuations in the Indian market are attributed heavily to cross border capital
flows in the form of FDI, FII and to reaction of Indian market to global market cues. In this
context, understanding the relationship and influence of various exchanges on each other is very
important. This study compares global exchanges which are from different geo- politico-socioeconomic areas. With the cross border movements of capital like never before in the form of FDI
and FII, coupled with the easing of restrictions bringing various stock exchanges at par in terms
of system and regulations, it can be assumed reasonably that a particular stock exchange will
have some impact on other exchanges.
1.
2.
3.
4.
5.
To know the relationship between the global markets with Indian market.
To find which global markets mostly influence the Indian market.
To find the relationship between MSCI and Indian Stock Market(NSE and BSE)
To find the risk of an Index stock i.e., ONGC with Nifty and Sensex.
To find the volatility of Nifty and Sensex at budget session time between 11am to
12:40pm.
METHODOLOGY:
The study is based on the data collected from eight global markets.
The secondary data is collected from NSE website, BSE website, SEBI website, chittorgarh
website, karvy website Angel Broking website, Books, Newspaper Journals and etc.
Statistical tools: Beta, Correlation, standard deviation
LIMITATIONS:
1.
2.
3.
4.
5.
6.
7.
Duration is very short

No primary data
Extracted data from NSE and BSE website, which is secondary.
As a student I dont have investment experience
Dependability
Very few indices have been taken for the whole study
Detailed study of the topic was not possible due to limited size of the project.
CHAPTER II
REVIEW OF LITERATURE:
Research studies
Global integration
Concept of stock exchange
National stock exchange
Global market movement
There is a numerous empirical research studies conducted in field of financial co-integration of

Indian stock markets with other countries stock markets during different time period by
employing different co-integration techniques.
Sharma and Kennedy (1977) examined the price behaviour of Indian market with the US and
UK markets and found that the behaviour of the Indian market is statistically indistinguishable
from that of the US and UK markets and found no evidence of systematic cyclical component
or periodicity found for these markets.
Taylor and Tonks (1989) were the first to apply bivariate co-integration in the UK and U.S
markets to test the importance of the latter after the abolition of foreign exchange controls in
1979. Using cointegration techniques, they found no significant increase in the correlation of
short-run stock market returns for the UK and certain overseas markets post 1979; their findings
also implied the inefficiency of a number of stock markets.
Rao and Naik (1990) applied the Cross-Spectral analysis and found the Indian stock index, the
gains estimates from either the US or the Japan indices are not dependent and hence they
concluded the relationship of Indian market with international markets is poor reflecting the
institutional fact that the Indian economy has been characterized by heavy controls throughout
the entire seventies with liberalization measures initiated only in the late eighties.
Cheung and Mak (1992) studied weekly return series of the AsianPacific emerging markets for
the period 1977 to 1988 and concluded that The US market can be considered as a 'global factor'
and is found to lead most of the Asian Pacific emerging markets except Korea, Taiwan and
Thailand. The Japanese market is found to have a less important influence on the Asian Pacific
emerging markets.
Kasa (1992) suggested that the short-term return correlation between stock markets is not
appropriate from the perspective of long-horizon investors driven by
common stochastic trends. A cointegration model is useful since it not only distinguishes
between the nature of long-run and of short-run linkages among financial markets, but captures
the interaction between them as well.
Hassan and Naka (1996) investigates the dynamic linkages among the U.S., Japan, U.K. and
German stock market and found significant evidence in support of both short-run and long-run
relationships among these four stock market indices. They suggested that in co-integrated
markets, price movements in one market immediately influence other markets, consistent with
efficient information sharing and free access to markets by domestic and foreign investors.
Elyasiani (1998) have investigated the interdependence and dynamic linkages between the
emerging capital markets of Sri Lanka with the markets of its major trading partners and have
found no significant interdependence between the SriLankan market and the equity market of the
US and other Asian countries.
Darrat and Zhong (2002) examined the linkages between eleven emerging Asia-Pacific markets
with US and Japan. They argued that the effect of the movements in the Japan market on the
Asia-Pacific region is only transitory.
Golaka C Nath&Sunil Verma (2003) examined the interdependence of the three major stock
markets in South Asia. Using daily stock market data from January 1994 to November 2002,
they examine the stock market indices of India (NSE-Nifty), Singapore (STI) and Taiwan
(Taiex). On employing bivariate and multivariate co-integration analysis to model the
linkages among the stock markets, no co-integration was found for the entire period. Hence, they
conclude that there is no long run equilibrium.
The results of Johnson (2003) revealed that the high share of trade with the US shows positive
effect, while the increased bilateral exchange rate volatility shows reverse effect on the stock
market co movements.
Flood and Rose (2003), describe a simple methodology to test for asset integration and apply it
within and between American stock markets. The techniques based on a general inter-temporal
asset-pricing model and rely on estimating and comparing expected risk free rates across assets.
Expected risk free rates are allowed to vary freely over time, constrained only by the fact that
they are equal across assets. The methodology used here takes into the fact that asset markets are
integrated when assets are priced by the same stochastic discount rate. This model has been
applied to stocks drawn from the S&P 500 and the NASDAQ, and the conclusions are that the
NASDAQ is usually integrated, the S&P always seems to be integrated and the S&P and the
NASDAQ do not seem to be closely integrated.
Guha, Oak,Bhupal and Daga (2004) have conducted research on the interdependence among
the major stock markets of the world. Using the monthly data from January 1993 to September
2003, They examined the stock market indices of India (SENSEX), Hong Kong (Hang Seng), the
USA(DJIA) and the UK (FTSE-100). Co-integration technique has been employed to study the
long-term linkages among the markets. They found that the equity markets of India and Hong
Kong are co-integrated with the other markets whereas the markets of the USA and UK are not.
Narayan
et al.
(2004) examines
the dynamic
linkages between
the stock
markets of
Bangladesh, India, Pakistan and Sri Lanka using Granger causality approach. In the short run
there is unidirectional Granger causality running from stock prices in Pakistan to India, stock
prices in Sri Lanka to India and from stock prices in Pakistan to Sri Lanka. Bangladesh is the
most exogenous of the four markets.
Mukharjee and Mishra (2005) applied the Engel-Granger (Engeland Granger1987) test of
causality and co integration and Geweke measure of feedback to empirically investigate the
hypothesis that the Indian stock market is not co integrated with other national markets in the
long run and there is no cause and effect relationship among those markets .The grangers
causality test and unidirectional Geweke feedback statics proved the fact that though Indian
equity market have some influence on the stock market of some of the Asian countries , the
equity market of European and American countries are not at all influenced /caused by India.
Colthup (2005) have found that bilateral trade, inflation rate differential, industrial production
growth differential, interest rate differential, stock market size and volatility, region etc. are some
of the important factors that can affect the spill over of information among the markets. In the
paper by A.S. Lamba (2005), he examined the influence of developed equity markets on Indian
markets and what influence can the Indian equity market exert on the others To examine these
dynamic relationships, a multivariate co- integration framework is used with error correction
models estimated to analyse the casual influence of the major developed markets on south Asian
markets. This method allows separation of any long run equilibrium relationships between the
markets from the short run casual effects.
Won, Agrawaland Du (2005) have investigated the long-run equilibrium relationship and shortrun dynamic linkage between the Indian stock market and the stock markets in major developed
countries (United States, United Kingdom and Japan) after 1990 by examining the Granger
causality relationship and the pair wise, multiple and fractional co integrations between the
Indian stock market and the stock markets from these three developed markets. They conclude
that Indian stock market is integrated with mature markets and sensitive to the dynamics in these
markets in a long run. In a short run, both US and Japan Granger causes the Indian stock market
but not vice versa. In addition, they find that the Indian stock index and the mature stock indices
form fractionally co integrated relationship in the long run with a common fractional, no
stationary component and find that the Johansen method is the best reveal their co-integration
relationship.
Bose and Mukharjee (2006) examined the co movement of the Indian stock market with
developed markets like US, Japan and other Asian markets with using tools like pair wise and
group wise co integration and granger-causality test .They found that on a daily bases the Indian
index is most highly correlated with the Singapore STI index, and it is also very highly
correlated with the stock indices of Malaysia, South Korea, Taiwan and Thailand , while the least
correlation is observed with the US S&P 500 index. Stock return in India are seen to be highly
correlated with returns in major markets like Hong Kong, Singapore, and Korea and also with
Thailand and Taiwan , while lowest correlations are observed.
Lamba (2005) conducted research on short run and long run relationship between India,
Pakistan and Sri Lanka and major developed market during July 1997 - December 2003. Using a
multivariate co integration framework and vector error-correction modeling, they found that the
Indian
market
is
influenced by the US, UK and Japan and South Asian equity markets are becoming more integ
rated witheach other but at a relatively slow pace.
Ashwin et al. (2008) has studied the long term and short term co-movement among the
developed market and emerging market with the help of co-integration technique. They had
studied the co-movements of the BSE, BVSP, MXX, HANGSENG, RTS, FTSE100, DJIA
and NASDAQ stock markets by using daily returns data for the July 1, 1997 to June 30, 2008
period. They found that the correlation of BSE with BVSP, MXX, FTSE100, DJIA and
NASDAQ is low.
Raj et al. (2009) has studied how the Indian stock market is integrated with other global markets
of the US, the UK and Japan and other major regional markets in Asia such as Singapore and
Hong Kong by VECM model and found that the integration of the Indian stock markets with
global markets such as the US and UK is much higher than with the regional markets.
Chittedi, Krishna Reddy (2009) empirically investigates the long run equilibrium relationship
between the BRIC(Brazil, Russia, India and China) stock markets and the stock market indices
of three major developed countries as a using the multivariate co integration. The multivariate co
integration technique is used to investigate the long run relationship. To assess the short run
influence of one market on the other and to assess how many days each market takes to factor
out the influence Indian stock market, they have used the Granger causality test with 02 days.
The study found that US, and Japan market factors influencing Indian stock market. It might be
because of maximum international trade commercial activities between these countries. Indian
stock market is not influencing by UK, Brazil, Russia and China markets. But Brazil and Russia
markets are influencing by Indian stock market. The study finally conclude that India and
developed countries markets USA, UK, Japan, and other Emerging BRIC markets highly co
integrating during the period of the study.
THEORITICAL FRAMEWORK
Global integrationthe widening and intensifying of linksbetween high-income and
developing countries has accelerated over the years. Over the past few years, the financial
markets have become increasingly global. The Indian market has gained (FIIs). Following the
implementation of reforms in the securities industry in the past few years, Indian stock world
ranking as per Standard and Poors Fact Book 2012,India ranked 11th in terms of market
capitalization, 17th in terms of total value traded in stock exchanges, and 30th in terms of turn
over ratio, as of December 2011.
The turnover of all the markets taken together has increased from US$65 trillion in 2010 to
US$66.4 trillion in 2011. Significantly, the US alone accounted for about 46.3 percent to the
world wide turn over in 2011. Despite having a large number of companies listed on its
exchanges, India accounted for a meager 1.1 percent to the total world turn over in 2011. A scan
be observed from Table1-4, the market capitalization of all the listed companies taken together
across all the markets stood at US$45.08 trillion in 2011(US$54.51trillionin2010). The share of
the US in world wide market capitalization increased from 31.4 percent at the end of 2010 to
34.7 percent at the end of 2011, ,while the Indian listed companies accounted for 2.3 percent of
the total market capitalization at the end of 2011.The stock market capitalization for some
developed and emerging countries is shown in Chart 1-3
Table1-4:International Comparison of Global Stock Markets:
InternationalComparis Market Capitalisation(US$mn)

on
MarketCapitalisationRatio
(inpercent)
No.oflistedCompanies
Markets
2009
2010
2011
2009
2009
2010
2011
DevelopedMarket
33,531,413
39,309,690
33,169,049
24,635
27,024
27,497
Australia
1,258,456
1,454,547
1,198,164
136.07
157.28
87.34
1,882
1,913
1,922
France
1,972,040
1,926,488
1,568,730
74.43
72.71
56.57
941
901
893
Germany
1,297,568
1,429,707
1,184,459
38.77
42.72
33.17
601
571
670
Japan
3,377,892
4,099,591
3,540,685
66.66
80.90
60.35
3,208
3,553
3,961
Korea
836,462
1,089,217
994,302
100.47
130.83
89.08
1,778
1,781
1,792
Singapore
310,766
370,091
308,320
170.53
203.09
128.63
459
461
462
UK
2,796,444
3,107,038
1,202,031
128.60
142.88
49.43
2,179
2,056
2,001
USA
15,077,286
17,138,978
15,640,707
105.76
120.22
103.62
4,401
4,279
4,171
EmergingMarkets
13,848,456
15,201,722
11,913,772
24,073
21,675
22,056
China
5,007,646
4,762,837
3,389,098
100.46
95.55
68.42
1,700
2,063
2,342
India
1,179,235
1,615,860
1,015,370
90.01
123.33
63.81
4,955
4,987
5,112
Russia
861,424
1,004,525
796,376
69.99
81.62
46.37
279
345
327
Brazil
1,167,335
1,545,566
1,228,969
74.26
98.32
47.13
377
373
366
Indonesia
178,191
360,388
390,107
32.98
66.70
21.04
398
420
440
Malaysia
255,952
410,534
395,083
133.59
214.27
91.85
960
957
941
Mexico
340,565
454,345
408,691
38.93
51.93
29.48
125
130
128
WorldTotal
47,379,869
54,511,412
45,082,821
--
--
--
48,732
48,782
49,553
2010
2011
USAaspercentofWorld 31.8
31.4
34.7
--
--
--
9.03
8.77
8.42
IndiaaspercentofWorld 2.5
3.0
2.3
--
--
--
10.17
10.22
10.32
Note: Listed companies in India pertain to BSE.

Market Capitalization ratio is computed as a percentage of GDP.
Koreahasbeenclassifiedasdevelopedmarketsfrom2010onwards.
Source: S&P Global Stock Market Factbook,2012 and World Development Indicators,
World Bank
Source: S&P Global Stock Market Factbook,2012 and World Development

Indicators, World Bank
CONCEPT OF STOCK EXCHANGE

The Securities Contracts (Regulation) Act, 1956, has defined Stock Exchange as an "association,
organization or body of individuals, whether incorporated or not, established for the purpose of
assisting, regulating and controlling business of buying, selling and dealing in Securities".
Stock exchange as an organized security market provides marketability and price continuity for
shares and helps in a fair evaluation of securities in terms of their intrinsic worth. Thus it helps
orderly flow and distribution of savings between different types of investments. This institution
performs an important part in the economic life of a country, acting as a free market for securities
where prices are determined by the forces of supply and demand. Apart from the above basic
function it also assists in mobilizing funds for the Government and the Industry and to supply a
channel for the investment of savings in the performance of its functions.
The Stock Exchanges in India as elsewhere have a vital role to play in the development of the
country in general and industrial growth of companies in the private sector in particular and
helps the Government to raise internal resources for the implementation of various development
programmes in the public sector. As a segment of the capital market it performs an important
function in mobilizing and channelising resources which remain otherwise scattered. Thus the
Stock Exchanges tap the new resources and stimulate a broad based investment in the capital
structure of industries.
A well developed and healthy stock exchange can be and should be an important institution in
building up a property base along with a socialist in India with broader distribution of wealth and
income. Thus Stock Exchange is a vital organ in a modern society. Without a stock exchange a
modern democratic economy cannot exist. The system of joint stock companies financed through
the public investment as emerged has put the vast means of finances almost to entrepreneurs'
needs.
Finance from external sources mainly from the investing public can become possible only
when an institute like Stock Exchange provides opportunities for the conversion of scattered
savings into profitable investments with the promises of a reasonable yield and minimum
element of risk. Such a mechanism as provided by Stock Exchanges is not merely a source of
capital but also a conduit which channelises the savings into investment along with a free
movement of capital. With the probable exception of a totalitarian state no Government will be
able to mobilize resources from the public if the money market in the form of stock exchange
does not exist.
The Stock Exchange benefits the entire community in a variety of way. It enables the
producers to raise capital which directly and indirectly gives gainful employment to millions of
people on the one hand and helps consumers to get ;the variety of goods needed by them on the
other. It provides opportunities to savers to store the value either as temporary abode of
purchasing power or as a permanent abode of purchasing power in the form of financial assets. It
also helps the segments of the savers who put their savings in commercial firms and non-banking
financial intermediaries because these institutions avail themselves of the services of Stock
Exchange to invest the money thus collected. The Stock Exchange comes close enough to a
perfectly competitive market allowing the forces of demand and supply a reasonable degree of
freedom to operate as compared to other markets specially the commodity markets. This segment
of the factor market can be considered as a perfect or a nearly perfect market.
Apart from providing a mechanism for transacting business in stock and shares it generates
genuine potential for a new entrepreneur to take up initiative in the private sector enterprises and
allows the expansion of investing community by offering gainful development of their otherwise
sluggish or shy capital.
The Stock Exchange must assume the responsibility of protecting the rights of investors specially
the small investors in the Joint Stock Companies.
EVOLUTION OF STOCK EXCHANGES IN INDIA

Any attempt at raising the standard of living of the masses must address itself to the task of
producing the right quantity of the right types of goods and have them available for consumption
at the right time. This requires large-scale production through coordination of activities of
hundreds of people under the same roof even when the product is the simplest to make.
This, however, calls for raising vast amounts of financial resources for the purpose of acquiring
land, buildings and equipments, besides purchasing raw materials and employing labour. No one
individual or a small group of individuals is rich enough to provide all the capital required by
modern business enterprise and savings of hundreds, if not thousands, of people must be
mobilized.
The corporate form of organization is well adapted to the task of raising capital from many
people. This is done by issuing or offering for sale at cash, different types of securities, that is,
shares and bonds, which offer to individual investors a means of productively employing
capital/savings suited to his/her needs and temperament.
The need for offering for sale different types of securities is obvious. Some people may desire
safety of the amount they have invested and a regular income from their investment. To them the
corporation or company may offer debenture bonds- a certificate issued under the seal of the
company promising a refund of the loan on a specified date and payment of interest at prescribed
intervals.
Other investors may be willing to commit their savings for an indefinite period of time and to
assume greater risk while still desiring safety of capital and stability of income. To them the
corporation will sell preference shares. Still other investors may be willing to shoulder the
business risk that goes along with the ownership of the business in the hope that the profit
realized would be large enough to compensate the greater risk they are assuming. But no one will
buy these securities unless there exists an organized market where the holders can dispose of
them, should the need arise, and new investors can purchase them. Over the years, such
organized markets have come into existence in all democratic and capitalistic countries including
India. Such a market is called stock market or a stock exchange in English speaking countries
and a 'brouse' in continental Europe.
There is, obviously, no need for stock exchange in
Communist countries since in such countries all the productive organizations are owned by the
government.
Organized stock exchange in India are of recent origin. As late as 1933 there were only three
stock exchanges one each at Ahmedabad, Bombay and Calcutta, but trading in securities was in
vogue much prior to that year. Of course, no one can tell when the first transaction took place,
however, it is generally agreed that business in securities had begun as early as the concluding
years of the 18th century, that is, between the years 1790 and 1800 A.D.
Existing structure of the stock exchanges in India

The Act recognizes stock exchanges with different legal structure. Presently the stock exchanges
which are recognized under the Securities Contracts (Regulation) Act in India, could be
segregated into two broad groups 20 stock exchanges which were set up as companies, either
limited by guarantees or by shares, and the 3 stock exchanges which are functioning as
associations of persons (AOP) viz. BSE, Ahmedabad Stock Exchange and Indore Stock
Exchange. The 20 stock exchanges which are companies are: the stock exchanges of Bangalore,
Bhubaneswar, Calcutta, Cochin, Coimbatore, Delhi, Guwahati, Hyderabad, Interconnected SE,
Jaipur, Ludhiana, Madras, Magadh, Managalore, NSE, Pune, OTCEI, Saurashtra-Kutch, Uttar
Pradesh, and Vadodara. Of these, the stock exchanges of Ahmedabad, Bangalore, BSE, Calcutta,
Delhi, Hyderabad, Madhya Pradesh, Madras and Guwahati were given permanent recognition by
the Central Government at the time of setting up of these stock exchanges. Apart from NSE, all
stock exchanges whether established as corporate bodies or Association of Persons (AOPs), are
non-profit making organizations.
BOMBAY STOCK EXCHANGE

Established in 1875, BSE Ltd. (formerly known as Bombay Stock Exchange Ltd.), is Asias first
Stock Exchange and one of Indias leading exchange groups. Over the past 137 years, BSE has
facilitated the growth of the Indian corporate sector by providing it an efficient capital-raising
platform. Popularly known as BSE, the bourse was established as "The Native Share & Stock
Brokers' Association" in 1875. BSE is a corporatized and demutualised entity, with a broad
shareholder-base which includes two leading global exchanges, Deutsche Bourse and Singapore
Exchange as strategic partners.BSE provides an efficient and transparent market for trading in
equity, debt instruments, derivatives, mutual funds. It also has a platform for trading in equities
of small-and-medium enterprises(SME).
More than 5000 companies are listed on BSE making it world's No. 1 exchange in terms
of listed members. The companies listed on BSE Ltd command a total market capitalization of
USD 1.32 Trillion as of January 2013. It is also one of the worlds leading exchanges (3rd largest
in December 2012) for Index options trading (Source: World Federation of Exchanges).
BSE also provides a host of other services to capital market participants including risk
management, clearing, settlement, market data services and education. It has a global reach with
customers around the world and a nation-wide presence. BSE systems and processes are
designed to safeguard market integrity, drive the growth of the Indian capital market and
stimulate innovation and competition across all market segments.
BSE is the first exchange in India and second in the world to obtain an ISO 9001:2000
certification. It is also the first Exchange in the country and second in the world to receive
Information Security Management System Standard BS 7799-2-2002 certification for its OnLine trading System (BOLT). It operates one of the most respected capital market educational
institutes in the country (the BSE Institute Ltd.). BSE also provides depository services through
its Central Depository Services Ltd.(CDSL)arm.
BSEs popular equity index - the S&P BSE SENSEX - is India's most widely tracked stock
market benchmark index. It is traded internationally on the EUREX as well as leading
exchanges of the BRCS nations (Brazil, Russia, China and South Africa).
HOURS OF OPERATION:
Session
Timing
Pre-open Trading Session
09:00 - 09:15
Trading Session
09:15 - 15:30
Position Transfer Session
15:30 - 15:50
Closing Session
15:50 - 16:05
Option Exercise Session
16:05
The hours of operation for the BSE quoted above are stated in terms the local time (GMT +
5:30). BSE's normal trading sessions are on all days of the week except Saturday, Sundays and
holidays declared by the Exchange in advance.
NATIONAL STOCK EXCHANGE

The National Stock Exchange (NSE) is India's leading stock exchange covering
various cities and towns across the country. NSE was set up by leading institutions
to provide a modern, fully automated screen-based trading system with national
reach. The Exchange has brought about unparalleled transparency, speed &
efficiency, safety and market integrity. It has set up facilities that serve as a model
for the securities industry in terms of systems, practices and procedures.
NSE has played a catalytic role in reforming the Indian securities market in terms
of microstructure, market practices and trading volumes. The market today uses
state-of-art information technology to provide an efficient and transparent trading,
clearing and settlement mechanism, and has witnessed several innovations in
products & services viz. demutualization of stock exchange governance, screen
based trading, compression of settlement cycles, dematerialization and electronic
transfer of securities, securities lending and borrowing, professionalization of
trading members, fine-tuned risk management systems, emergence of clearing
corporations to assume counterparty risks, market of debt and derivative
instruments and intensive use of information technology.
The National Stock Exchange (NSE) is stock exchange located at Mumbai, India.
It is the 11th
largest
stock
exchange in the world by market
capitalization and largest in India by daily turnover and number of

trades, for both equities and derivative trading. NSE has a market
capitalization of around US$1 trillion and over 1,652 listings as of
July 2012.Though a number of other exchanges exist, NSE and
the Bombay Stock Exchange are the two most significant stock
exchanges in India and between them are responsible for the vast
majority of share transactions. The NSE's key index is the S&P CNX
Nifty, known as the NSE NIFTY (National Stock Exchange Fifty), an index of fifty major
stocks weighted by market capitalization.
NSE is mutually owned by a set of leading financial institutions, banks, insurance companies and
other financial intermediaries in India but its ownership and management operate as separate
entities. There are at least 2 foreign investors NYSE Euronext and Goldman Sachs who have
taken a stake in the NSE.As of 2006, the NSE VSAT terminals, 2799 in total, cover more than
1500 cities across India. In 2011, NSE was the third largest stock exchange in the world in terms
of the number of contracts (1221 million) traded in equity derivatives. It is the second fastest
growing stock exchange in the world with a recorded growth of 16.6%.
ORIGIN OF NSE: The National Stock Exchange of India was set up by Government of
India on the recommendation of Pherwani Committee in 1991.Promoted by leading Financial
institutions essentially led by IDBI at the behest of the Government of India, it was incorporated
in November 1992 as a tax-paying company. In April 1993, it was recognized as a stock
exchange under theSecurities Contracts (Regulation) Act, 1956. NSE commenced operations in
the Wholesale Debt Market (WDM) segment in June 1994. The Capital market (Equities)
segment of the NSE commenced operations in November 1994, while operations in
the Derivatives segment commenced in June 2000.
OBJECTIVES OF NSE: .
Establishing nationwide trading facilities for all types of securities.

Ensuring equal access to investors all-over the country through an appropriate
communication network
Meeting international benchmarks and standards.
Enabling shorter settlement cycles and book entry settlements
MARKETS: Currently, NSE has the following major segments of the capital market
Equities
Equities
Indices
Mutual Funds
Exchange Traded Funds
Initial Public Offerings
Security Lending and Borrowing Scheme
Derivatives
Equity Derivatives (including Global Indices like S&P 500, Dow Jones and FTSE )
Currency Derivatives
Interest Rate Futures
Debt
Retail Debt Market
Wholesale Debt Market
Corporate Bonds
Equity Derivatives The National Stock Exchange of India Limited (NSE) commenced
trading in derivatives with the launch of index futures on June 12, 2000. The futures and options
segment of NSE has made a mark for itself globally. In the Futures and Options segment, trading
in S&P CNX Nifty Index, CNX IT index, Bank Nifty Index, Nifty Midcap 50 index and single
stocks are available. Trading in Mini Nifty Futures & Options and Long term Options on S&P
CNX Nifty are also available. The average daily turnover in the F&O Segment of the Exchange
during 2009-10 was ` 72,392 crore (US $ 16,097 million)
On August 29, 2011, National Stock exchange launched derivative contracts on the worlds most
followed equity indices, the S&P 500 and the Dow Jones Industrial Average. This was the first
time that derivative contracts on global indices are available in India. This is the also the first
time in the world that futures contracts on the S&P 500 index were introduced and listed on an
exchange outside of their home country, USA. The new contracts include futures on both the
DJIA and the S&P 500, and options on the S&P 500. The first day volumes at the close of trading
on August 29, 2011 at 3.30 pm, on the 2 indices in futures and options contracts were nearly
Rs.122 crores (1220 million).
On May 3, 2012,The National Stock exchange launched derivative contracts (futures and
options) on FTSE 100, the widely tracked index of the UK equity stock market. This was the
first of its kind for an index of the UK equity stock market to be launched in India. FTSE 100
includes 100 largest UK listed blue chip companies and has given returns of 17.8 per cent on
investment over three years. The index constitutes 85.6 per cent of UKs equity market cap. NSE
recorded a volume of 500 crores (5000 million) on the 1st day of trading.
Currency Derivatives In August 2008 currency derivatives were introduced in India with
the launch of Currency Futures in USD INR by NSE. It also added currency futures in euros,
pounds and yen. Interest Rate Futures were introduced for the first time in India by NSE on 31
August 2009, exactly one year after the launch of Currency Futures.
Debt Market NSE became the first stock exchange to get approval for interest rate futures, As
recommended by SEBI-RBI committee, on 31 August 2009, a futures contract based on 7% 10
Year Government of India (Notional) was launched with quarterly maturities.
GLOBAL MARKETS MOVEMENT:
The movement of a few of the selected indices presented in Table 4-6 brings out the trends
witnessed in the Indian and foreign markets during 2010-2011and 2011-2012. A global
comparison of these selected indices indicates that in 2010-11, all these indices barring Nikkei
225 witnessed average returns in the range of 10-15 percent. However, in 2011-2012 all these
indices depicted varied kinds of performance, US indices and Nikkei225 managed to close in
green and rest al indices closed in red compared to 2010-2011 values. The period AprilSeptember 2012 saw some mixed performance again. The S&P CNX Nifty gained 7.7 percent,
while the Nikkei 225 Index lost the maximum ground, to the tune of 12.1percent in the first six
months of 2012-13.
Table4-6:Movement of Select Indices on Indian & Foreign Markets
Index-Country
IndexValueason
Changedurin
g2011-12
(Percent)
Changedurin
gApr-Sep'12(
Percent)
31-Mar-11
31-Mar-12
30-Sep-12
12319.73
13212.04
13437.13
7.2
1.7
Nasdaq-US
2781.07
3091.57
3116.23
11.2
0.8
FTSE100-UK
5908.80
5768.45
5742.07
-2.4
-0.5
CAC-France
3989.18
3423.81
3354.82
-14.2
-2.0
5833.75
5295.55
5703.30
-9.2
7.7
BSESensex-India
19445.22
17404.20
18762.74
-10.5
7.8
HangSeng-HongKong(China)
23527.52
20555.58
20840.38
-12.6
1.4
Nikkei-Japan
9755.10
10083.56
8870.16
3.4
-12
Kospi-SouthKorea
2106.70
2014.04
1996.21
-4.4
-0.9
DowJones-US
AsiaPacific
Europe Americas
Region
Nifty50(S&PCNXNifty)-India
Source:Bloomberg,BSE&NSE
Comparing the movement of the Nifty, SENSEX, and NASDAQ over 2010-2011 (as depicted
in Chart4- 1) , the Nifty 50 performed better than other Asian indices such as the Nikkie225
and the Hang Seng Index for most of the year. The returns on the NASDAQ were 11.2 percent
in 2011-2012, while that of the FTSE100 and the Hang Seng Index declined to 2.4 percent
and12.6 percent, respectively, over the same period (Table4-6). The Japanese stock market
indicator Nikkie225 yielded returns of 3.4 percent.
Source:NSE,Bloomberg
CHAPTER-III
COMPANY PROFILE
Brief History of company

Structure of the company
Investment advisory services
Portfolio management services
HISTORY OF THE ANGEL BROKING
Angel Broking's tryst with excellence in customer relations began in 1987. Today, Angel has
emerged as one of the most respected Stock-Broking and Wealth Management Companies in
India. With its unique retail-focused stock trading business model, Angel is committed to
providing Real Value for Money to all its clients.
It has membership on Bombay Stock Exchange (BSE), National Stock Exchange (NSE) and the
leading Commodity Exchanges in the India NCDEX & MCX. Angel is also registered as a
Depository Participant with CDSL.
Angel Group Companies:
Angel Broking Ltd

- Members on the BSE and Depository participant with CDSL
Angel Capital & Debt Market Ltd Membership on the NSE Cash and Futures &
options Segment
Angel commodities Broking Ltd Member on the NCDEX & MCX
Angel securities Ltd Member on the BSE.
Incorporated
1987
BSE Membership
1997
NSE Membership
1998
Member of NCDEX&MCX
Depositor Participants with CDSL
Angels presence:
Nation-wide network of 21 regional hubs
Presence 124 cities
6800 + sub brokers and business associates
5.9 lakh + clients
Management:
S.N
O
Name
Mr. Dinesh
Thakkar
Mr. Lalit Thakkar
Mr. Amit
Majumdar
Mr. Rajiv Phadke
Mr. Vinay Agarwal
Mr. Nikil Daxini
Mr. Hitungshu
Debnath
1
2
3
Designation & Department

Founder Chairman &
Managing Director
Director-Research
Executive Director-Strategy
and Finance
Executive Director-HR & Corp
Executive Director-Equity
Broking
Executive Director-Sales &
Marketing
Executive DirectorDistribution & Wealth
Management
Awards & Milestones:
May,2009:Angel Broking wins two prestigious awards for 'Broking House with Largest
Distribution Network' and 'Best Retail Broking House' at Dun & Bradstreet Equity
Broking Awards
August,2008:Angel Broking crosses 5,00,000 mark in unique trading accounts
November, 2007 Major Volume Driver for 2007
December, 2006 Created 2500 business associates

October, 2006 Major Volume Driver award for 2006
September, 2006 Launched Mutual Fund and IPO business
July, 2006 Launched the PMS function
September, 2004 Launched Online Trading Platform
April, 2004 Initiated Commodities Broking division
April, 2003 First published research report
November, 2002 Angels first investor seminar
March, 2002 Developed web-enabled back office software
November, 1998 Angel Capital and Debt Market Ltd. Incorporated
December, 1997 Angel Broking Ltd. Incorporated
Vision of the Company:

To provide best value for money to investors through innovative products, trading/investments
strategies, state of the art technology and personalized service.
Philosophy of the Company:
Ethical practices & transparency in all our dealings

Customers interest above our own
Always deliver what we promise
Effective cost management
Quality Assurance Policy:

We are committed to providing world-class products and services which exceed
the expectations of our customers, achieved by teamwork and a process of
continuous improvement.
CRM Policy : Customer is King
A Customer is the most Important Visitor on our premises. He is not dependent on us, but we are
dependent on him. He is not an interruption in our work. He is the purpose of it. He is not an
outsider in our business. He is part of it. We are not doing him a favour by serving.He is doing us
a favour by giving us an opportunity to do so.
Logo of the Company:
OUR ORGANISATIONAL SRUCTURE:
Business Associates
Products of Angel Broking:
Online Trading
Commodities
Portfolio Management Services
Mutual Funds
Life Insurance
IPO
Depository Services
Personal loans
E-Broking:
Angel has different products and voila trading on BSC,NSE,F&O,MCX & NCDEX. It provides
four softwares to customers for online trading.
Angel Investor:
User-friendly browser for investors

Easy online trading platform
Works in proxy and firewall system setup
Integrate Back office: Access account information-anytime, anywhere
Online fund transfer facility
Multiple exchanges on single screen
Angel Trade:
Browser based for investor

No installation required
Advantage of mobility
BSC,NSC,F&O,MCX & NCDEX
Angel Diet:
Application based ideal for traders

User friendly and simple navigation
Angel Anywhere:
Application-based platform for day traders

Intra-day/historical charts with various indicators
BSC,NSC,Cash &Derivatives
Investment Advisory services:

To derive optimum returns from equity as an asset classes requires professional guidance and
advise. Professional assistance will always be beneficial in wealth creation. Investment decisions
without expert advises would be like treating alignment without the help of a doctor.
Expert advise
Timely Entry and Exit.
De-Risking Portfolio.
Commodities:
Commodity is a basic good representing a monitory value.Commodities are most often used as
inputs in the production of other goods or services.
Types of Commodities:
Precious metals
Gold and silver
Base Metals
Copper, zinc and aluminium
Energy
Crude oil, Brent crude and natural Gas
Pulses
Chana, urad and Tur
Benefits at Angel:
Three different online products tailored for traders and investors.

Single screen customised Market-watch for MCX/NCDEX with BSE/NSE.
Streaming Quotes and real time rates. Intra-day trading calls.
An array of daily, weekly an special research reports.
Seminars,workshops and investment camps for investors
Depository Participant service:
Wide branch coverage

Personalised/attentive services of trained a dedicated staff
Centralised building and accounting
Acceptances and executions of instructions on fax.
Daily statement of transactions and holding statement on e-mail
No charges for extra transaction statement and holdings statement
Portfolio Management Services:

Successful investing in capital markets demands every more time and expertise. Investment
management is an art and a science in itself.The portfolio management service combined with
competent fund management, dedicate research and technology, ensures rewarding experience
for its clients.
Mutual Fund:
To enable clients to diversify their investment in right direction.Angel broking as added another
product in its range with mutual funds
Access to in-depth research and proper selection from diversified funds based on your
preferred criteria
Rating and ranking for all mutual funds from our in house expert analysts
Current and historical performance of different funds enable comparisons.
Benefits:
No risk of loss,wrong transfer, mutilation or theft of share certificates

Hassle free automated pay-in of your sell obligations by your clearing members
Reduced paper work
Instant disbursement of non-cash benefits like bonus and rights into your account
Efficient pledge mechanism
CHAPTER-IV
DATA ANALYSIS
&
INTERPRETATION
Calculation of correlation between global and Indian markets

- Calculation of volatility between BSE and NSE
VOLATILITY OF NIFTY AND SENSEX DURING BUDGET

SESSION
NIFTY DURING BUDGET HOURS:
NSE
5834
5836
5831
5827
deviati squa
ons
res
36.333 1320.
333
11
38.333 1469.
333
44
33.333 1111.
333
11
29.333 860.4
333
44
5812
5799
5773
5774
5693
total
mea
n
14.333
333
1.3333
333
24.666
67
23.666
67
104.66
67
5217
9
5797
.67
Volatility
205.4
44
1.777
78
608.4
44
560.1
11
1095
5.1
1709
2
1899
.11
43.5
78
SENSEX DURING BUDGET HOURS:
BSE
deviatio
ns
squar
es
Total
mea
n
1926
5
1929
2
1927
4
1922
9
1922
0
1915
8
1910
4
1907
2
1886
2
1724
76
1916
4
Volatility
101
10201
128
16384
110
12100
65
4225
56
3136
-6
36
-60
3600
-92
8464
-302
91204
14935
0
1659
4.4
128.8
19
INTERPRETATION:
The volatility of sensex is very high when compared with Nifty at the time of budget.
CORRELATION BETWEEN THE GLOBAL MARKETS WITH

NIFTY:
Days
Mon 4
Tue 5
Wed 6
Thu 7
Fri 8
Correlat
ion
Nikkie 225
Prev.Cl Open
ose
Price@12:15
Pm
11606. 11685.93
38
11652.
29
11683.
45
11932.
27
11968.
08
11756.41
11830.61
11999.38
12191.35
%Cha
nge
S&P Cnx Nifty

Close Open
Price
0.685
399
5719.
7
5698.5
0.893
558
1.259
559
0.562
424
1.865
546
5698.
5
5784.
25
5818.
6
5863.
3
5784.2
5
5818.6
5863.3
5945.7
%Cha
nge
0.370
65
1.504
782
0.593
854
0.768
226
1.405
352
0.4939
45
Interpretation:
The Above Table Depicts The Correlation Between Nikkie With Nifty. The Values Shows That
Japan Market Moderately Correlated With Indian Market In Asia Japan Economy Is Considered
As One Of The Bigger Economy As Flows Of Fii Are Impacting The Indian Markets.
CORRELATION BETWEEN THE SHANGI WITH NIFTY:
Days
Mon 4
Tue 5
Shang
ai
Prv.Clo
se
2359.
51
S&P Cnx Nifty

Open
Price@11:15am
2300.566
2273.
4
2326.
31
2347.
18
2298.519
Fri 8
2324.
29
2323.794
Correlat
ion
0.843
945
Wed 6
Thu 7
Interpretation:-
2341.482
2343.915
%Chn
age
2.498
15
1.104
909
0.652
192
0.139
1
0.021
34
Close
5719.
7
Open
Price
5698.5
5698.
5
5784.
25
5818.
6
5784.2
5
5818.6
5863.
3
5945.7
5863.3
%Cha
nge
0.370
65
1.504
782
0.593
854
0.768
226
1.405
352
As Correlation Is High Between China And India ,The Impact Of China On Indian Stock
Market Is Moderately Effected. In Our Asian Economy China And India Growth Is More That Is
The Reason Fdi And Fii Flows Are Very High On The Two Countries.
CORRELATION BETWEEN THE HANGSENG WITH NIFTY:
Days
Mon 4
Tue 5
Wed 6
Thu 7
Fri 8
Correlat
ion
Hang Seng
Prv.Clo Open
se
Price@11:15am
22880 22645
.22
22537
.8
22560
.5
22777
.84
22771
.96
0.787
64
Interpretations:
22610.59
22742.54
22800.69
23001.03
%Chn
ge
1.028
05
0.322
969
0.806
893
0.100
312
1.005
948
S&P Cnx Nifty

Close Open
Price
5719. 5698.5
7
5698.
5
5784.
25
5818.
6
5863.
3
5784.2
5
5818.6
5863.3
5945.7
%Cha
nge
0.370
65
1.504
782
0.593
854
0.768
226
1.405
352
When Correlation Between Hangseng And S&P Cnx Nifty Is High, Our Indian Economy
Performed Well Due To Positive Aspects On India.
CORRELATION BETWEEN THE FTSE 100 INDEX WITH

NIFTY:
Ftse 100
Prev.Cl
ose
6378.6
Index
Open
Price
6379.2
7
%Chn
age
0.010
504
S&P Cnx Nifty

12:30 012:40
pm
pm
5687. 5677.6
25
Tue 5
6345.6
3
6345.7
2
0.001
418
5755.
6
5752.4
6
Wed 6
6431.9
5
6427.6
4
6432.3
2
6427.5
6
5183.
7
5813.
1
5812.1
5
5808.4
5
6439.1
6
6439.2
0.005
753
0.001
24
0.000
621
5893.
25
5897.2
5
Days
Mon 4
Thu 7
Fri 8
%Cha
nge
0.169
68
0.054
56
12.12
358
0.079
99
0.067
874
Correlat
ion
0.2670
06
Interpretation:-
Even Though London Stock Market Is 3 Largest Economy In The World ,As The
Movements Of This Stock Market Is Less Active With Our Indian Economy,
Indian Stock Markets Are Least Effected.
CORRELATION BETWEEN THE CAC 40 INDEX WITH NIFTY:
Cac
40
Pr.Clo
se
3699.
91
Op
Price
3699.
91
%Cha
nge
0
12:30
pm
5687.
25
012:40
pm
5677.6
Tue 5
3709.
76
3709.
76
5755.
6
5752.4
6
Wed 6
3787.
19
3773.
76
3787.
19
3773.
76
5183.
7
5813.
1
5812.1
5
5808.4
5
Days
Mon 4
Thu 7
S&P Cnx Nifty
%Cha
nge
0.169
68
0.054
56
12.12
358
0.079
Fri 8
3793.
78
Correlat
ion
=0
3793.
78
5893.
25
5897.2
5
99
0.067
874
Interpretation:
As Correlation Is Zero There Is No Effect Of French Market On Indian Economy.
CHAPTER-V
FINDINGS
FINDINGS:
U.S.A markets are most influencing one in the world.70% of the world economy is moved by the
global markets and in that US is playing the vital role. Based on time zone analysis Asian
markets are opening based on last night closing of US markets. European markets are also major
markets than India, according Indian time 12:30pm to 12:40pm in between these markets will
open. Opening of European also will have its impact on us.
There is huge volatility between NSE and BSE during budget session
The correlation between NIKKIE 225 and NIFTY is 0.493945.So,the Japan market
is moderately correlated with Indian market in Asia.

The correlation between SHANGAI and NIFTY is 0.843945.So,the China markets
are highly correlated with Indian markets

The correlation between the HANG SENG and NIFTY is 0.78764. so, the
HONGKONG markets are highly correlated with Indian markets.

The correlation between the FTSE 100 and NIFTY is 0.267006.So,the UNITED
KINGDOM markets are slightly correlated with Indian markets.

The correlation between CAC 40 and NIFTY is 0.So,the EUROUP markets are
slightly correlated with Indian markets.
CHAPTER-VI
SUGGESTIONS
Suggestions:
1.Trading Should Start At 8o Clock In The Morning And End At 4o Clock In The Evening
With One Hour Break Between1pm To 2pm.
2.There Should Be 24 Hours F &O
3. The Pre Open Session Should Be Introduced For IPO'S On Listing Day.
4. NSE Along with SEBI Should Take More Initiative To Increase The Awareness About The
Market From Schooling.
5. The Exchange Has To Increase Their Branches & Network.
6.Nse Should Change The Calculations Of Stock Settlement Prices After Closing The Market.
7. Brokers Are Blocking Illiquid Counters By Stopping Trading In Particular Companies. SEBI
And Exchange Should Guide The All The Brokers To All Trading In All The Stocks Which Are
There In NSE And BSE.
CHAPTER-VII
CONCLUSIONS
Conclusion:
I Conclude The Analysis On The Correlation Of Indian Stock Market With Global Markets. In
The Modern Economic, Investment Are Taking Place Across The Global, Flow Of Fund Are
Rolling With The Growth Nation In The Form Of Fiis. Global Market Are Impacting The India
Stock Market In The Analysis I Have Measured The Co- Relation Between Asian Market
European Market With India Based On The Time Zone Analysis I Found Japan And Germany
Are Having High Co relation With India, There Is A Scope For The Further Research To Measure
The Impact On India Markets With Global Markets.
CHAPTER-VIII
BIBILOGRAPHY
BIBLIOGRAPHY
WEBSITES:
http://www.nseindia.com/
http://www.rbi.org.in/home.aspx
http://www.sebi.gov.in/sebiweb/
http://www.forex.com/pages/land-international.html
NEWSPAPERS:
Economic Times
Business Line
CHAPTER - 1
INTRODUCTION
INTRODUCTION:
There are a couple of old sayings in business. One is, "Cash is king." Another is,
"Happiness is a positive cash flow." Surveys are conducted constantly of failed
businesses. Most failed businesses, up to 60%, say that all or most of their failure
was due to cash flow problems. Businesses have to have as their guide another old
saying. Nothing matters more than cash. Making a profit is nice, cash flow is
necessary. Cash management is the key to business success.
Start-up businesses often find themselves short of cash right off the mark. Existing
businesses can find ways to survive if they can find ways to generate cash. Cash is
the single most important element of survival for a small business. Small businesses
often say that an inability to control cash is their single biggest problem.
Just like an individual or a family, companies need cash cushion to rely on. This
gives them security in unstable times. It also gives them an opportunity to take
advantage of strategic investments or take advantage of opportunities to reduce
costs. Small businesses also have to focus on the concept of free cash flow in order
to establish that cash cushion.
Duncan Connor, of Company.com talks about how companies used their cash flow to
remain successful during the recession, "It's a simple case of managing how much
flows in or out of your business and when. Successful businesses managed their
expenses, maximized margins, and built their customer base."
In financial accounting, a cash flow statement, also known as statement of cash
flows or funds flow statement, is a financial statement that shows how changes in
balance sheet accounts and income affect cash and cash equivalents, and breaks
the analysis down to operating, investing, and financing activities. Essentially, the
cash flow statement is concerned with the flow of cash in and cash out of the
business. The statement captures both the current operating results and the
accompanying changes in the balance sheet As an analytical tool, the statement of
cash flows is useful in determining the short-term viability of a company,

particularly its ability to pay bills. International Accounting Standard 7 (IAS 7) is the
International Accounting Standard that deals with cash flow statements.
People and groups interested in management include:
Accounting personnel, who need to know whether the organization will be

able to cover payroll and other immediate expenses
Potential lenders or creditors, who want a clear picture of a company's ability

to repay
Potential investors, who need to judge whether the company is financially

sound
Potential employees or contractors, who need to know whether the company

will be able to afford compensation
Shareholders of the business.
NEED AND IMPORTANCE OF STUDY
Many business owners disregard the importance of Cash management because they
unwittingly believe that their current financial standing can be construed from other
financial reports and projections. Unfortunately, however, a cash flow is necessary
to adequately assess the incoming and outgoing flow of cash and other resources in
a
business.
Not only will a business owner with a cash flow system be more aware of his or her
financial standing, but it will also help investors to make educated decisions on
future investments. A business with regular and reliable cash flow statements shows
more economic
solvency,
and
is
more
attractive
to
investors.
SCOPE OF THE STUDY:

Since it will not be possible to conduct a micro level study of all Cement
industries in Andhra Pradesh, the study is restricted to Ultra Tech Cements
Limited only.
To know cash flow from one to one, as the time available is very limited and
the subjects are very vast, the study is continued to overall financial condition of a
firm.
This study is to know working capital increase or decrease funds from
operation, sources and application of funds of M/S Ultra Tech Cements Limited.
Financial analysis consists of funds flow analysis. To know cash flow from one
to one, as the time available is very limited and study is continued to overall
financial condition of a firm. The study to know working capital increase or
decrease, cash from operation, source and application of funds
OBJECTIVES:
To know the Management of cash in the organization Ultra Tech Cements
Limited.
To access the efficiency with sources and uses of cash were made by the co
ordinance the present year 2009-2010 to 2013-2014.
To identify the changes in the elements of focus and uses of working capital in
between above mentioned year.
To improve the financial performance of the company.
METHODOLOGY OF STUDY:
The following are the main sources of date used for this study which are
Collected and compiled from published and unpublished sources of the Company
data. The published sources are as follows.
1)
Management information system published by
Ultra
Tech
Cements
Limited.
2)
Status Report on Ultra Tech Cements Limited.
3)
Journals, books and other published reports.

The present study is mainly based on primary and secondary sources of Data
collection. The primary data was directly collected by observations, Interviews

questionnaire etc.
The secondary data was collected from the literate available in libraries and
research studies and annual reports are related to the present study. It includes
published and unpublished literature like books, reports and generally Articles of the
Ultra Tech Cements Limited.

The limitations of present study are as follows:
14.The study cover a period of Four years from 2010-2014.
15.The study does not flow the fund.
16.The study is based mainly on secondary information.
17.The study does not touch all the units of Ultra Tech Cements Limited.
18.The present study cannot be used for inter firm comparison.
19.Limited span of time is a major limitation for this project.
20.The act and figures of the study is limited to the period of Four years i.e.
2010-2014
21.The data used in reports are taken from the annal reports published at the
and of the year.
22.The result does not reflect the day-to-day transcations.
23.The data used in reports are taken from the annual reports, published at the
end of the years.
24.The result does not reflect the day-to-day transactions.
25.It is also impossible to the study of day-to-day transactions in cash
management.
26.The analysis of the working capital is taken FIVE years.
CHAPTER-II
INDUSTRY PROFILE
&
COMPANY PROFILE
Cement industry in India:

Introduction:
The Indian cement industry is directly related to the country's infrastructure
sector and thus its growth is paramount in determining the development of the
country. With a current production capacity of around 366 million tonnes (MT), India
is the second largest producer of cement in the world and fueled by growth in the
infrastructure sector, the capacity is expected to increase to around 550 MT by
FY20.
India has a lot of potential for development in the infrastructure and
construction sector and the cement sector is expected to largely benefit from it.
Some of the recent major government initiatives such as development of 100 smart
cities are expected to provide a major boost to the sector.
Expecting such developments in the country and aided by suitable
government foreign policies, several foreign players such as the likes of Lafarge,
Holcim and Vicat have invested in the country in the recent past. Another factor
which aids the growth of this sector is the ready availability of the raw materials for
making cement, such as limestone and coal.
Market Size:
According to data released by the Department of Industrial Policy and
Promotion (DIPP), cement and gypsum products attracted foreign direct investment
(FDI) worth US$ 2,984.29 million between April 2000 and September 2014.
In India, the housing sector is the biggest demand driver of cement, accounting for
about 67 per cent of the total consumption. The other major consumers of cement
include infrastructure at 13 per cent, commercial construction at 11 per cent and
industrial construction at nine per cent.
To meet the rise in demand, cement companies are expected to add 56 MT capacity
over the next three years. The cement capacity in India may register a growth of
eight per cent by next year end to 395 MT from the current level of 366 MT. It may
increase further to 421 MT by the end of 2017. The country's per capita
consumption stands at around 190 kg.
A total of 188 large cement plants together account for 97 per cent of the total
installed capacity in the country, while 365 small plants account for the rest. Of
these large cement plants, 77 are located in the states of Andhra Pradesh,
Rajasthan and Tamil Nadu. The Indian cement industry is dominated by a few
companies. The top 20 cement companies account for almost 70 per cent of the
total cement production of the country.
Investment:
On the back of growing demands, due to increased construction and
infrastructural activities, the cement sector in India has seen many investments and
developments in recent times. Some of them are as follows:
Lafarge and Holcim plans to request for the European Commission's approval for
their possible merger. The two companies had earlier unveiled plans in April
2014 to create the world's biggest cement group with US$ 44 billion in yearly
sales.
JSW cement plans to enter the Kerala market to cash in on the construction
frenzy in the state. JSW is presently building a three million tonnes per annum
(MTPA) capacity plant at Chitrapur in Karnataka to add to the current 5.4 MTPA
capacity in South India.
Zuari Cement through its subsidiary Gulbarga Cement Limited (GCL) plans to set
up a 3.23 MT cement plant in Gulbarga, Karnataka. The company along with the
cement plant is setting up a 50 MW captive power plant in the region.
Malabar Cements plans to set up an automated cement handling and bagging

unit as well as raw materials import facility in the Kochi port. Malabar Cements
has projected a minimum throughput of 300,000 tonnes per annum which can be
extendable up to 600,000 tonnes per annum, apart from intermediate products

and raw materials such as clinker, limestone and coal.
Reliance Cement Company (RCC), a subsidiary of Reliance Infrastructure, has

entered into the cement market of Bihar where the demand for the building
material is on the rise due to a realty boom. RCC presently has plants with total
installed capacity of 5.8 MTPA.
In the 12th Five Year Plan, the government plans to increase
investment in infrastructure to the tune of US$ 1 trillion and increase the industry's
capacity to 150 MT.
The Cement Corporation of India (CCI) was incorporated by the Government of India
in 1965 to achieve self-sufficiency in cement production in the country. Currently,
CCI has 10 units spread over eight states in India.
In order to help the private sector companies thrive in the industry, the government
has been approving their investment schemes. Some such initiatives by the
government in the recent past are as follows:
The Andhra Pradesh State Investment Promotion Board (SIPB) has approved
proposals worth Rs 9,200 corer (US$ 1.48 billion) including three cement plants
and concessions to Hero Motorcar project. The total capacity of these three
cement plants is likely to be about 12 MT per annum and the plants are expected
to generate employment for nearly 4,000 people directly and a few thousands
more indirectly.
India has joined hands with Switzerland to reduce energy consumption and
develop newer methods in the country for more efficient cement production,
which will help India meet its rising demand for cement in the infrastructure
sector.
The Government of India has decided to adopt cement instead of bitumen for the
construction of all new road projects on the grounds that cement is more durable
and cheaper to maintain than bitumen in the long run.
Road Ahead:
With the Government of India providing a boost to the infrastructure and
various housing projects coming up in urban as well as rural areas, the cement
sector has enough scope for development in the future.
Market Size :
The Indian cement sector is expected to witness positive growth in the
coming years, with demand set to increase at a CAGR of more than 8 per cent in the
period FY 2013-14 to FY 2015-16, according to the latest report titled Indian
Cement Industry Outlook 2016 by market research consulting firm RNCOS. The
report further observed that Indias southern region is creating the maximum
demand for cement, which is expected to increase more in future.
The cement and gypsum products sector has attracted foreign direct investments
(FDI) worth US$ 2,656.29 million in the period April 2000August 2013, according to
data published by the Department of Industrial Policy and Promotion (DIPP).
Investments:
Prism Cement Ltd has become the first Indian company to get the Quality
Council of India's (QCI) certification for its ready-mix concrete (RMC) plant in
Kochi, Kerala. The company received the certification from Institute for
Certification and Quality Mark (ICQM), a leading Italian certification body
authorised to oversee QCI compliance.
UltraTech Cement, an Aditya Birla Group Company, has acquired the 4.8 million
tonne per annum (MTPA) Gujarat unit of Jaypee Cement Corp for Rs 3,800 crore
(US$ 595.61 million).
ACC Ltd plans to invest Rs 3,000 core (US$ 470.22 million) to expand its capacity
by nearly 4 MT a year in three eastern region states, over the next three years.
Reliance Cements Co Pvt Ltd will set up a 3 MTPA grinding unit at an estimated
cost of Rs 600 core (US$ 94.04 million). The unit is likely to come up at
Raghunathpur in Purulia, West Bengal.
Reliance Cement Co, a special purpose vehicle (SPV) of Reliance Infrastructure

Ltd, is commissioning its first 5 MTPA plant in Madhya Pradesh. The project has
been implemented at a cost of approximately Rs 3,000 crore (US$ 470.22
million).
Zuari Cement plans to set up a cement grinding unit at Auj (Aherwadi) and
Shingadgaon villages in Solapur, Maharashtra. The new unit will have a
production capacity of 1 MTPA and is expected to be operational by the second
quarter of 2015.
JSW Steel has acquired Heidelberg Cement India's 0.6 MTPA cement grinding
facility in Raigad, Maharashtra, for an undisclosed amount.
Giving impetus to the market, the Indian government plans to roll
out public-private partnership (PPP) projects worth Rs 1 trillion (US$ 15.67 billion)
over the next six months. The Principal Secretary in the Prime Minister's Office
(PMO) will monitor these projects.
Also, the steering group appointed by Dr Manmohan Singh, Prime Minister of India,
to accelerate infrastructure investments, has set deadlines for the awarding of
projects such as Mumbai rail corridor and Navi Mumbai Airport, among others.
The Goa State Pollution Control Board (GSPCB) has signed a memorandum of
understanding (MoU) with Vasavdatta Cement, a company with its plant in
Karnataka. The firm would use the plastic waste collected by the state agencies and
village panchayats from Goa as fuel for its manufacturing plant.
Road Ahead:
The globally-competitive cement industry in India continues to witness

positive trends such as cost control, continuous technology upgradation and
increased construction activities.
Furthermore, major cement manufacturers in India are progressively using
other alternatives such as bioenergy as fuel for their kilns. This is not only helping to
bring down production costs of cement companies, but is also proving effective in
reducing emissions.
With the ever-increasing industrial activities, real estate, construction and
infrastructure, in addition to the various Special Economic Zones (SEZs) being
developed across the country, there is a demand for cement.
It is estimated that the country requires about US$ 1 trillion in the period FY
2012-13 to FY 2016-17 to fund infrastructure such as ports, airports and highways
to boost growth, which promises a good scope for the cement industry.
The 4th Annual India Cement Sector Business Sentiment Survey is nearly out
and the India Construction & Building Materials Journal provides the opportunity of
an exclusive look at the surveys results before their sharing with the wider
audiences. We are glad to be able to present here some of the survey highlights and
provide our readers with before-hand data regarding the views and expectations of
cement industry professionals.
Optimism continues to be the name of the game for the Indian cement
industry a function of long-term trends as well as human nature. But on a closer
look, the survey shows that the optimism only runs skin deep and that it has already
been eroded by an increasing percentage of industry members who feel dissatisfied
with the overall performance of the field last year.
For instance, the percentage of those who believe the industry performed
well dropped from 43 percent in 2012 to 26 percent in 2013, while the number of
respondents who believe the industry performed poorly almost tripled from 8
percent last year to 22 percent in 2013. Regarding the future evolution of the
industry, survey participants continue to be on the optimistic side and hope for a
somewhat better or much better performance compared to the last 6 months.
China tackles pollution and overcapacity:

2013 has been the year that China's central planners took action against
cement production overcapacity and pollution. Consolidation plans for the industry
followed falling profits for cement producers in 2012. However, record air pollution
levels in Beijing in early 2013 shut the city down, raised public awareness and gave
the government a strong lever to encourage further industry consolidation through
environmental controls. By the middle of year profits of major producers were up
but production was also up. Finally in December 2013, China started to launch its
emissions trading schemes (ETS), led by Guangdong province, to create what will be
the second largest carbon market in the world after the EU ETS.India faces a
sticky
wicket
Meanwhile, the world's second largest cement producing country has faced poor
profits and growth for cement producers blamed on paltry demand, piddling prices
and proliferating production costs. Compounding that, the Indian Rupee fell to a
historic low relative to the US Dollar in mid-2013, further putting pressure on input
costs. Holcim reacted to all of this by releasing plans to simplify its presence in the
country between Holcim India, Ambuja and ACC.Sub-Saharan Africa draws up
the
battle
lines
Competition in sub-Saharan Africa is set to intensify when Nigeria's Dangote

Cement opens its first cement plant in South Africa in early 2014. It is the first time
Africa's two largest cement producers, Dangote and South Africa's PPC, will produce
cement in the same country. Future clashes will follow across the region as each
producer increasingly advances toward the other. The Kingdom needs cement...
and
workers
Saudi Arabian infrastructure demands have created all sorts of reverberations

across the Middle Eastern cement industry and beyond as the nation pushes on to
build its six 'economic' cities amongst other projects.
Back in April 2013 King Abdullah bin Abdul-Aziz Al Saud of Saudi Arabia
issued an edict ordering the import of 10Mt of cement. Then some producers
started to report production line shutdowns in the autumn of 2013 as they buckled
under the pressure, although they consoled themselves with solid profit rises. Now,
cement sales have fallen following a government crackdown on migrant workers
that has hit the construction sector.
Europe may be slowly emerging from the economic gloom but anti-trust
regulators have remained vigilant. An asset swap between Cemex and Holcim over
units in the Czech Republic, Germany and Spain has received attention from the
European Commission. In the UK the Competition Commission has decreed that
further action is required for the cement sector following the creation of new player
Hope Construction Materials in 2012. Lafarge Tarmac may now have to sell another
one of its UK cement plants to increase more competition into the market.
Elsewhere in Europe, Belgium regulators took action in September 2013 and this
week we report on Polish action against cartel-like activity.
Don't forget
South-East Asia,
Brazil or
Russia!
Growth continues to dominate these regions and major sporting

tournaments are on the way in Brazil and Russia, further adding to local cement
demand. Votorantim may have cancelled its US$4.8bn initial public offering in
August 2013 but it is still has the highest cement production capacity in Brazil.
Finally, Indonesia may not have had any 'marquee' style story to sum up 2013 but it
continues to regularly announce cement plant builds. In July 2013 the Indonesian
Cement Association announced that cement sales growth had fallen to 'just' 7.5%
for the first half of 2013.
In the most general sense of the word, a cement is a binder, a substance
which sets and hardens independently, and can bind other materials together. The
word "cement" traces to the Romans, who used the term "opus caementicium" to
describe masonry which resembled concrete and was made from crushed rock with
burnt lime as binder. The volcanic ash and pulverized brick additives which were
added to the burnt lime to obtain a hydraulic binder were later referred to as
cementum, cimentum, lament and cement. Cements used in construction are
characterized as hydraulic or non-hydraulic.
The most important use of cement is the production of mortar and concrete
the bonding of natural or artificial aggregates to form a strong building material
which is durable in the face of normal environmental effects.
Concrete should not be confused with cement because the term cement refers only
to the dry powder substance used to bind the aggregate materials of concrete.
Upon the addition of water and/or additives the cement mixture is referred to as
concrete, especially if aggregates have been added.
It is uncertain where it was first discovered that a combination of hydrated
non-hydraulic lime and a pozzolan produces a hydraulic mixture (see also:
Pozzolanic reaction), but concrete made from such mixtures was first used on a
large scale by engineers. They used both natural pozzolans (tress or pumice) and
artificial pozzolans (ground brick or pottery) in these concretes. Many excellent
examples of structures made from these concretes are still standing, notably the
huge monolithic dome of the Pantheon in Rome and the massive Baths of Caracalla.
The vast system of Roman aqueducts also made extensive use of hydraulic cement.
The use of structural concrete disappeared in medieval Europe, although weak
pozzolanic concretes continued to be used as a core fill in stone walls and columns.
Modern cement
Modern hydraulic cements began to be developed from the start of the Industrial
Revolution (around 1800), driven by three main needs:
Hydraulic renders for finishing brick buildings in wet climates
Hydraulic mortars for masonry construction of harbor works etc, in contact with sea
water.
Development of strong concretes.
In Britain particularly, good quality building stone became ever more expensive
during a period of rapid growth, and it became a common practice to construct
prestige buildings from the new industrial bricks, and to finish them with a stucco to
imitate stone. Hydraulic lines were favored for this, but the need for a fast set time
encouraged the development of new cements. Most famous was Parker's "Roman
cement." This was developed by James Parker in the 1780s, and finally patented in
1796. It was, in fact, nothing like any material used by the Romans, but was a
"Natural cement" made by burning septaria - nodules that are found in certain clay
deposits, and that contain both clay minerals and calcium carbonate. The burnt
nodules were ground to a fine powder. This product, made into a mortar with sand,
set in 515 minutes. The success of "Roman Cement" led other manufacturers to
develop rival products by burning artificial mixtures of clay and chalk.
John Smeaton made an important contribution to the development of cements when
he was planning the construction of the third Eddy stone Lighthouse (1755-9) in the
English Channel. He needed a hydraulic mortar that would set and develop some
strength in the twelve hour period between successive high tides. He performed an
exhaustive market research on the available hydraulic lines, visiting their production
sites, and noted that the "hydraulicity" of the lime was directly related to the clay
content of the limestone from which it was made. Smeaton was a civil engineer by
profession, and took the idea no further. Apparently unaware of Smeaton's work, the
same principle was identified by Louis Vacant in the first decade of the nineteenth
century. Vicat went on to devise a method of combining chalk and clay into an
intimate mixture, and, burning this, produced an "artificial cement" in 1817. James
Frost,orking in Britain, produced what he called "British cement" in a similar manner
around the same time, but did not obtain a patent until 1822. In 1824, Joseph Asp
din patented a similar material, which he called Portland cement, because the
render made from it was in color similar to the prestigious Portland stone.
All the above products could not compete with lime/pozzolan concretes because of
fast-setting (giving insufficient time for placement) and low early strengths
(requiring a delay of many weeks before formwork could be removed). Hydraulic
lines, "natural" cements and "artificial" cements all rely upon their belite content for
strength development. Belite develops strength slowly. Because they were burned
at temperatures below 1250 C, they contained no elite, which is responsible for
early strength in modern cements. The first cement to consistently contain elite was
made by Joseph Aspdin's son William in the early 1840s. This was what we call
today "modern" Portland cement. Because of the air of mystery with which William
Asp din surrounded his product, others (e.g. Vicat and I C Johnson) have claimed
precedence in this invention, but recent analysis of both his concrete and raw
cement have shown that William Asp dins product made at North fleet, Kent was a
true elite-based cement. However, Asp dins methods were "rule-of-thumb": Vicat is
responsible for establishing the chemical basis of these cements, and Johnson
established the importance of sintering the mix in the kiln.
William Asp dins innovation was counter-intuitive for manufacturers of "artificial
cements", because they required more lime in the mix (a problem for his father),
because they required a much higher kiln temperature (and therefore more fuel)
and because the resulting clinker was very hard and rapidly wore down the
millstones which were the only available grinding technology of the time.
Manufacturing costs were therefore considerably higher, but the product set
reasonably slowly and developed strength quickly, thus opening up a market for use
in concrete. The use of concrete in construction grew rapidly from 1850 onwards,
and was soon the dominant use for cements. Thus Portland cement began its
predominant role. it is made from water and sand
Types of modern cement
Portland cement
Cement is made by heating limestone (calcium carbonate), with small quantities of
other materials (such as clay) to 1450C in a kiln, in a process known as calcination,
whereby a molecule of carbon dioxide is liberated from the calcium carbonate to
form calcium oxide, or lime, which is then blended with the other materials that
have been included in the mix . The resulting hard substance, called 'clinker', is
then ground with a small amount of gypsum into a powder to make 'Ordinary
Portland Cement', the most commonly used type of cement (often referred to as
OPC).
Portland cement is a basic ingredient of concrete, mortar and most non-speciality
grout. The most common use for Portland cement is in the production of concrete.
Concrete is a composite material consisting of aggregate (gravel and sand),
cement, and water. As a construction material, concrete can be cast in almost any
shape desired, and once hardened, can become a structural (load bearing) element.
Portland cement may be gray or white.
Portland cement blends

These are often available as inter-ground mixtures from cement manufacturers, but
similar formulations are often also mixed from the ground components at the
concrete mixing plant.
Portland blast furnace cement: contains up to 70% ground granulated blast
furnace slag, with the rest Portland clinker and a little gypsum. All compositions
produce high ultimate strength, but as slag content is increased, early strength is
reduced, while sulfate resistance increases and heat evolution diminishes. Used as
an economic alternative to Portland sulfate-resisting and low-heat cements.
Portland fly ash cement: contains up to 30% fly ash. The fly ash is pozzolanic, so
that ultimate strength is maintained. Because fly ash addition allows a lower
concrete water content, early strength can also be maintained. Where good quality
cheap fly ash is available, this can be an economic alternative to ordinary Portland
cement.
Portland pozzolan cement: from other natural or artificial pozzolans. In countries
where volcanic ashes are available (e.g. Italy, Chile, Mexico, the Philippines) these
cements are often the most common form in use.
Portland silica fume cement: Addition of silica fume can yield exceptionally high
strengths, and cements containing 5-20% silica fume are occasionally produced.
However, silica fume is more usually added to Portland cement at the concrete
mixer.
Masonry cements: are used for preparing bricklaying mortars and stuccos, and
must not be used in concrete. They are usually complex proprietary formulations
containing Portland clinker and a number of other ingredients that may include
limestone, hydrated lime, air entertainers, retarders, water proofers and coloring
agents. They are formulated to yield workable mortars that allow rapid and
consistent masonry work. Subtle variations of Masonry cement in the US are Plastic
Cements and Stucco Cements. These are designed to produce controlled bond with
masonry blocks.
Expansive cements: contain, in addition to Portland clinker, expansive clinkers

(usually sulfoaluminate clinkers), and are designed to offset the effects of drying
shrinkage that is normally encountered with hydraulic cements. This allows large
floor slabs (up to 60 m square) to be prepared without contraction joints.
White
blended
cements: may be made using white clinker and white
supplementary materials such as high-purity met kaolin.

Colored cements: are used for decorative purposes. In some standards, the
addition of pigments to produce "colored Portland cement" is allowed. In other
standards (e.g. ASTM), pigments are not allowed constituents of Portland cement,
and colored cements are sold as "blended hydraulic cements".
Very finely ground cements: are made from mixtures of cement with sand or
with slag or other pozzolan type minerals which are extremely finely ground
together. Such cements can have the same physical characteristics as normal
cement but with 50% less cement particularly due to their increased surface area
for the chemical reaction. Even with intensive grinding they can use up to 50% less
energy to fabricate than ordinary Portland cements.
Non-Portland hydraulic cements
Mixtures of ground pozzolan and lime are the cements used by the Romans, and
are to be found in Roman structures still standing (e.g. the Pantheon in Rome). They
develop strength slowly, but their ultimate strength can be very high. The hydration
products that produce strength are essentially the same as those produced by
Portland cement.
Slag-lime cements: Ground granulated blast furnace slag is not hydraulic on its
own, but is "activated" by addition of alkalis, most economically using lime. They
are similar to pozzolan lime cements in their properties. Only granulated slag (i.e.
water-quenched, glassy slag) is effective as a cement component.
Super sulfated cements: These contain about 80% ground granulated blast
furnace slag, 15% gypsum or anhydrite and a little Portland clinker or lime as an
activator. They produce strength by formation of ettringite, with strength growth
similar to a slow Portland cement. They exhibit good resistance to aggressive

agents, including sulfate.
Calcium aluminate cements: are hydraulic cements made primarily from
limestone and bauxite. The active ingredients are monocalcium aluminates CaAl 2O4
(CaO Al2O3 or CA in Cement chemist notation, CCN) and mayenite Ca12Al14O33 (12
CaO 7 Al2O3 , or C12A7 in CCN). Strength forms by hydration to calcium aluminate
hydrates. They are well-adapted for use in refractory (high-temperature resistant)
concretes, e.g. for furnace linings.
Calcium sulfoaluminate cements: are made from clinkers that include ye'elimite
(Ca4(AlO2)6SO4 or C4A3
in Cement chemist's notation) as a primary phase. They are
used in expansive cements, in ultra-high early strength cements, and in "lowenergy" cements. Hydration produces ettringite, and specialized physical properties
(such as expansion or rapid reaction) are obtained by adjustment of the availability
of calcium and sulfate ions. Their use as a low-energy alternative to Portland
cement has been pioneered in China, where several million tonnes per year are
produced. Energy requirements are lower because of the lower kiln temperatures
required for reaction, and the lower amount of limestone (which must be
endothermic ally decarbonated) in the mix. In addition, the lower limestone content
and lower fuel consumption leads to a CO 2 emission around half that associated
with Portland clinker. However, SO2 emissions are usually significantly higher.
"Natural" Cements: correspond to certain cements of the pre-Portland era,
produced by burning argillaceous lime stones at moderate temperatures. The level
of clay components in the limestone (around 30-35%) is such that large amounts of
belite (the low-early strength, high-late strength mineral in Portland cement) are
formed without the formation of excessive amounts of free lime. As with any natural
material, such cements have highly variable properties.
Geopolymer cements: are made from mixtures of water-soluble alkali metal
silicates and aluminosilicate mineral powders such as fly ash and metakaolin.
COMPANY PROFILE
ULTRATECH CEMENT:
UltraTech Cement Limited has an annual capacity of 18.2 million tonnes. It

manufactures and markets Ordinary Portland Cement, Portland Blast Furnace Slag
Cement and Portland Pozzalana Cement. It also manufactures ready mix concrete
(RMC).
UltraTech Cement Limited has five integrated plants, six grinding units and three
terminals two in India and one in Sri Lanka.
UltraTech Cement is the countrys largest exporter of cement clinker. The export
markets span countries around the Indian Ocean, Africa, Europe and the Middle
East.
UltraTechs subsidiaries are Dakshin Cement Limited and UltraTech Ceylinco (P)
Limited.
The roots of the Aditya Birla Group date back to the 19th century in the picturesque
town of Pilani set amidst the Rajasthan desert. It was here that Seth Shiva Narayan
Birla started trading in cotton, laying the foundation for the House of Birlas.
Through India's arduous times of the 1850s, the Birla business expanded rapidly. In
the early part of the 20th century, our Group's founding father, Ghanshyamdas
Birla, set up industries in critical sectors such as textiles and fibre, aluminium,
cement and chemicals. As a close confidante of Mahatma Gandhi, he played an
active role in the Indian freedom struggle. He represented India at the first and
second round-table conference in London, along with Gandhi. It was at "Birla House"
in Delhi that the luminaries of the Indian freedom struggle often met to plot the
downfall of the British Raj.
Ghanshyamdas Birla found no contradiction in pursuing business goals with the
dedication of a saint, emerging as one of the foremost industrialists of preindependence India. The principles by which he lived were soaked up by his
grandson, Aditya Vikram Birla, our Group's legendary leader.
Aditya Vikram Birla: putting India on the world map

A formidable force in Indian industry, Mr. Aditya Birla dared to dream of setting up a
global business empire at the age of 24. He was the first to put Indian business on
the world map, as far back as 1969, long before globalization became a buzzword in
India.
In the then vibrant and free market South East Asian countries, he ventured to set
up world-class production bases. He had foreseen the winds of change and staked
the future of his business on a competitive, free market driven economy order. He
put Indian business on the globe, 22 years before economic liberalization was
formally introduced by the former Prime Minister, Mr. Narasimha Rao and the former
Union Finance Minister, Dr. Manmohan Singh. He set up 19 companies outside India,
in Thailand, Malaysia, Indonesia, the Philippines and Egypt.
Interestingly, for Mr. Aditya Birla, globalization meant more than just geographic
reach. He believed that a business could be global even whilst being based in India.
Therefore, back in his home-territory, he drove single-mindedly to put together the
building blocks to make our Indian business a global force.
Under his stewardship, his companies rose to be the world's largest producer of
viscose staple fiber, the largest refiner of palm oil, the third largest producer of
insulators and the sixth largest producer of carbon black. In India, they attained the
status of the largest single producer of viscose filament yarn, apart from being a
producer of cement, grey cement and rayon grade pulp. The Group is also the
largest producer of aluminium in the private sector, the lowest first cost producers
in the world and the only producer of linen in the textile industry in India.
At the time of his untimely demise, the Group's revenues crossed Rs.8,000 crore
globally, with assets of over Rs.9,000 core, comprising of 55 benchmark quality
plants, an employee strength of 75,000 and a shareholder community of 600,000.
Most importantly, his companies earned respect and admiration of the people, as
one of India's finest business houses, and the first Indian International Group
globally. Through this outstanding record of enterprise, he helped create enormous
wealth for the nation, and respect for Indian entrepreneurship in South East Asia. In
his time, his success was unmatched by any other industrialist in India.
That India attains respectable rank among the developed nations was a dream he
forever cherished. He was proud of India and took equal pride in being an Indian.
Under the leadership of our Chairman, Mr. Kumar Mangalam Birla, the Group has
sustained and established a leadership position in its key businesses through
continuous value-creation. Spearheaded by Grasim, Hindalco, Aditya Birla Nuvo,
Indo Gulf Fertilizers and companies in Thailand, Malaysia, Indonesia, the Philippines
and Egypt, the Aditya Birla Group is a leader in a swathe of products viscose
staple fibre, aluminium, cement, copper, carbon black, palm oil, insulators,
garments. And with successful forays into financial services, telecom, software and
BPO, the Group is today one of Asia's most diversified business groups.
Board of Directors:
::
Mr. Kumar Mangalam Birla, Chairman
::
Mrs. Rajashree Birla
::
Mr. R. C. Bhargava
::
Mr. G. M. Dave
::
Mr. N. J. Jhaveri
::
Mr. S. B. Mathur
::
Mr. V. T. Moorthy
::
::
Mr. S. Rajgopal
::
Mr. D. D. Rathi
::
Mr. S. Misra, Managing Director
Executive President & Chief Financial Officer:

::
Mr. K. C. Birla
Chief Manufacturing Officer :

::
R.K. Shah
Chief Marketing Officer :

::
Company Secretary :
::
Mr. S. K. Chatterjee
Ourvision
To actively contribute to the social and economic development of the
human development index."
Awards won
Year
2013-2014
2012-2013
2011-2012
Award
Associated with Government projects & Business World FICCI-SEDF

CSR Award
ASSOCHAM CSR Excellence Award for its "truly outstanding" CSR
activities
2010-2011
Subh Karan Sarawagi Environment Award
2010-2011
Business World FICCI-SEDF CSR Award
2010
Genentech Environment Excellence Gold Award
2010
2010
Asian CSR Award
2009-2010
National Award for Prevention of Pollution
2009-2010
Rajiv Gandhi Environment Award for Clean Technology
2009-2010
State Level Environment Award (Plant)
Making a difference
Before Corporate Social Responsibility found a place in corporate lexion, it was
While carrying forward this philosophy, his grandson, Aditya Birla weaved in the
concept of 'sustainable livelihood', which transcended cheque book philanthropy. In
his view, it was unwise to keep on giving endlessly. Instead, he felt that channelising
resources to ensure that people have the wherewithal to make both ends meet
would be more productive. He would say, "Give a hungry man fish for a day, he will
eat it and the next day, he would be hungry again. Instead if you taught him how to
fish, he would be able to feed himself and his family for a lifetime."
Our strategy:
Our focus areas:

Our rural development activities span five key areas and our single-minded goal
here is to help build model villages that can stand on their own feet. Our focus areas
are healthcare, education, sustainable livelihood, infrastructure and espousing
social causes.
The name Aditya Birla evokes all that is positive in business and in life. It
exemplifies integrity, quality, performance, perfection and
above all character.
Our logo is the symbolic reflection of these traits. It is the cornerstone of our
corporate identity. It helps us leverage the unique Aditya Birla brand and endows us
with a distinctive visual image.
Depicted in vibrant, earthy colors, it is very arresting and shows the sun rising over
two circles. An inner circle symbolizing the internal universe of the Aditya Birla
Group, an outer circle symbolizing the external universe, and a dynamic meeting of
rays converging and diverging between the two.
Through its wide usage, we create a consistent, impact-oriented Group image. This
undoubtedly enhances our profile among our internal and external stakeholders.
Our corporate logo thus serves as an umbrella for our Group. It signals the common
values and beliefs that guide our behavior in all our entrepreneurial activities. It
embeds a sense of pride, unity and belonging in all of our 130,000 colleagues
spanning 25 countries and 30 nationalities across the globe. Our logo is our best
calling card that opens the gateway to the world.
Group companies:
::
Grasim Industries Ltd.
:: Hindalco Industries Ltd.

:: Aditya Birla Nuvo Ltd.
:: UltraTech Cement Ltd.
Indian companies:
::
Aditya Birla Minacs IT Services Ltd.
:: Aditya Birla Minacs Worldwide Limited

:: Essel Mining & Industries Ltd
:: Idea Cellular Ltd.
:: Aditya Birla Insulators
:: Aditya Birla Retail Limited
::
Aditya
Birla
(India) Limited
International companies:
Thailand:
::
:: Indo Thai Synthetics
Thai Rayon
Chemicals
:: Thai Acrylic Fiber

:: Thai Carbon Black
:: Aditya Birla Chemicals (Thailand) Ltd.
Philippines:
::
Indo Phil Group of companies
:: Pan Century Surfactants Inc.

Indonesia:
::
PT Indo Bharat Rayon
:: PT Elegant Textile Industry

:: PT Sunrise Bumi Textiles
:: PT Indo Liberty Textiles
:: PT Indo Raya Kimia
Egypt:
::
Alexandria Carbon Black Company S.A.E
:: Alexandria Fiber Company S.A.E

China:
::
Liaoning Birla Carbon
:: Birla Jingwei Fibres Company Limited

:: Aditya Birla Grasun Chemicals (Fangchenggang) Ltd.
Canada:
::
A.V. Group
Australia:
::
Aditya Birla Minerals Ltd.
Laos:
::
Birla Laos Pulp & Plantations Company Limited
North and South America, Europe and Asia:

::
Novelis Inc.
Singapore:
::
Swiss Singapore Overseas Enterprises Ptv. Ltd. (SSOE)
Joint ventures:
::
Birla Sun Life Insurance Company
:: Birla Sun Life Asset Management Company

:: Aditya Birla Money Mart Limited
:: Tanfac Industries Limited
UltraTech is India's largest exporter of cement clinker. The company's production

facilities are spread across eleven integrated plants, one white cement plant, one
clinkerisation plant in UAE, fifteen grinding units, and five terminals four in India
and one in Sri Lanka. Most of the plants have ISO 9001, ISO 14001 and OHSAS
18001 certification. In addition, two plants have received ISO 27001 certification
and four have received SA 8000 certification. The process is currently underway for
the remaining plants. The company exports over 2.5 million tonnes per annum,
which is about 30 per cent of the country's total exports. The export market
comprises of countries around the Indian Ocean, Africa, Europe and the Middle East.
Export is a thrust area in the company's strategy for growth.
UltraTech's products include Ordinary Portland cement, Portland Pozzolana cement
and Portland blast furnace slag cement.
Ordinary Portland cement
Portland blast furnace slag cement
Portland Pozzolan cement
Cement to European and Sri Lankan norms
Ordinary Portland cement:

Ordinary Portland cement is the most commonly used cement for a wide range of
applications. These applications cover dry-lean mixes, general-purpose ready-mixes,
and even high strength pre-cast and pre-stressed concrete.
Portland blast furnace slag cement:

Portland blast-furnace slag cement contains up to 70 per cent of finely ground,
granulated blast-furnace slag, a nonmetallic product consisting essentially of
silicates and alumino-silicates of calcium. Slag brings with it the advantage of the
energy invested in the slag making. Grinding slag for cement replacement takes
only 25 per cent of the energy needed to manufacture Portland cement. Using slag
cement to replace a portion of Portland cement in a concrete mixture is a useful
method to make concrete better and more consistent. Portland blast-furnace slag
cement has a lighter colour, better concrete workability, easier finish ability, higher
compressive and flexural strength, lower permeability, improved resistance to
aggressive chemicals and more consistent plastic and hardened consistency.
Portland Pozzolana cement:

Portland pozzolana cement is ordinary portland cement blended with pozzolanic
materials (power-station fly ash, burnt clays, ash from burnt plant material or
silicious earths), either together or separately.
UltraTech takes its responsibility to conserve the environment very seriously, and its
eco-friendly approach is evident across all spheres of its operations. Its major thrust
has been to identify alternatives to achieve set objectives and thereby reduce its
carbon footprint. These are done through:
::
Waste management
::
Energy management
::
Water conservation
::
Biodiversity management
::
A forestation
::
Reduction in emissions
Our strategy:
Our vision:
"To actively contribute to the social and economic development of the
human
development
index."

Making a difference:
Before Corporate Social Responsibility found a place in corporate lexicon, it was
PRODUCT PROFILE:
ULTRA TECH CEMENTS manufactures and distributes its own main product
lines of cement .We aim to optimize production across all of our markets, providing
a complete solution for customer's needs at the lowest possible cost, an approach
we call strategic integration of activities.
Cement is made from a mixture of 80 percent limestone and 20 percent clay.
These are crushed and ground to provide the "raw meal, a pale, flour-like powder.
Heated to around 1450 C (2642 F) in rotating kilns, the meal undergoes
complex chemical changes and is transformed into clinker. Fine-grinding the clinker
together with a small quantity of gypsum produces cement. Adding other
constituents at this stage produces cements for specialized uses.
QUALITY:
Six strong benefits that make 43, 53 Grade, Super fine, Premium and
Shakti the ideal cement
Higher compressive strength.
Better soundness.
Lesser consumption of cement for M-20 Concrete Grade and above.
Faster de shuttering of formwork.
Reduced construction time with a superior and wide range of cement catering
to every conceivable building need, ULTRA TECH CEMENTS is a formidable
player in the cement market.
Here just a few reasons why ULTRA TECH CEMENTS chosen by millions of India.
Ideal raw material
Low lime and magnesia content and high proportion of silicates.
CHAPTER-III
LITERATURE REVIEW
Literature of cash management:

"One of the first things that successful businesses did during the recession was to look at their
borrowing and renegotiate the terms to something that, while it may be over more years and
ultimately more expensive, has lower payments now. Yes, adding more debt is probably a bad
idea for most businesses, but if refinancing existing debt allows you to stay in business, there's a
definite upside to doing it."
"Other businesses negotiated longer periods for making payments to suppliers, while at the same
time requiring faster payments from customers."
Another way that recession-surviving businesses management cash flow was to manage how
much inventory was being carried at any given time - inventory costs money, and inventory
which sits on your stock-room floor for weeks has an opportunity cost which can bankrupt your
business."
The least desirable expense control is always in human resources, but as orders reduced, many
manufacturing businesses laid off staff, instituted freezes or cuts to pay and benefits, reduced
investment in hiring and training."
Connor concludes, "On the other side of things, the making money flow inside, there were a few
tricks, too."
"Accounts receivable factoring has appeared on the radars of more small business operators in
the last two years, but the highlights are that you sell your invoices for between three and ten
percent less than the invoice amount. Now you're asking why any business would do that. The
answer is that for most businesses, 90 percent of an invoice now is better than 100 percent of an
invoice in ninety days. That's if the customer pays in full. Factoring allowed businesses to get
almost all of their invoices paid by a third party and focus on doing business and generating
leads rather than chasing payments. The third party chases the customer for payment."
Cash and Profit:

Cash flow and profit are not the same thing. Financial accounting is not focused on cash flow. It
is focused on net income or profit. Over the long term, profit and cash flow are approximately
the same but the crucial difference is timing.
Timing can be so important for a small business. For example, when you make a sale to a credit
customer, you recognize that sale immediately on your income statement. That's called accrual
accounting. However, you don't get the money immediately. On your cash budget and your
statement of cash flows, you don't show that credit transaction until you actually receive
payment.
You can see how the gap between profit and cash flow could be very large. If you have rapid
growth in credit sales, for example, profit could far exceed actual cash received. This sort of
situation makes smaller companies very vulnerable to running out of cash.
What is Liquidity?
You often hear the word liquidity used in combination with cash management. Liquidity is a
firm's ability to pay its short-term debt obligations. In other words, if the firm has adequate
liquidity, it can pay its current liabilities such as accounts payable. Usually, accounts payable are
debts you owe your suppliers.
There are methods you can use to measure your liquidity. Financial ratio analysis will help you
determine how liquid your firm is or how successful it will be in meeting its short-term debt
obligations. The current ratio will help you determine the ratio of your current assets to your
current liabilities. Current assets include cash, accounts receivable, inventory, and occasionally
other line items such as marketable securities. You need to have more current assets than current
liabilities on your balance sheet at all times.
Cash Budgets:
Most companies should prepare monthly cash budgets to keep track of their cash. In
fact, cash budgets should be done six to twelve months in advance to project cash
needs. The cash budget will capture the timing difference between the profit you
see on the income statement and the cash that is actually coming into the firm and
flowing out of the firm.
The purpose of the cash budget is not to set targets for cash but to anticipate
needs. If you prepare cash budgets 6 - 12 months in advance and your needs
change, then change your cash budgets. Keep them up to date because the cost of
running low on cash in a business is high. You should know that from your own
personal finances. Prepare your budgets conservatively.
How to Maximize Your Cash Flow:

Your goal, as the owner and manager of your company, is to squeeze all the cash
out of your balance sheet that you can. Not only do you want to get as much cash
out of your company as you can, you want to keep it out in case of a potential or
actual crisis.
Two of your current asset accounts are usually big drains on your cash. They are
inventory and accounts receivable. Inventory is the products you sell and accounts
receivable are your credit accounts or those the accounts that represent the credit
you extend to customers. The balances in both accounts need to be converted to
cash as soon as possible.
You can use financial ratio analysis to check out your position regarding inventory
and accounts receivables. Inventory turnover ratios can tell you if your inventory is
obsolete or if you are selling so fast you are stocking out. Accounts receivable
ratios, such as day's sales outstanding, can tell you how fast your credit customers
are cleaning up their accounts among other things. Once you determine the position
of your inventory and receivables, you can take the appropriate actions to adjust
the situations and have more cash coming in to your firm.
Keys to Good Cash Management:

The bottom line to good cash management is that, in a crisis, typical financial
statements become irrelevant and all that is important is surviving from a cash
point of view. In a cash crisis, such as a recession, a business owner's focus
becomes, by necessity, very short-term. Often, a cash crisis will instill good cash
management practices into business managers that carry over from that day
forward.
Managers have to understand how to prepare a monthly cash budget. Next, they
must understand sources and uses of cash like are stated on the Statement of Cash
Flows, one of three required financial statements. The feedback you get from these
financial statements is invaluable.
Investing:
Changes in equipment, assets or investments relate to
cash from investing. Usually cash changes from investing are a "cash out" item,
because cash is used to buy new equipment, buildings or short-term assets such as
marketable securities. However, when a company divests of an asset, the
transaction
is
considered
"cash
in
for calculating
cash
from
investing.
Financing:
Changes in debt, loans or dividends are accounted for in cash from financing.
Changes in cash from financing are "cash in" when capital is raised, and they're
"cash out" when dividends are paid. Thus, if a company issues a bond to the public,
the company receives cash financing; however, when interest is paid to
bondholders, the company is reducing its cash.
Cash
Statement
Flow Income Statement
1. It is disclosing the
reasons for change in
working capital i.e.,
where
from
the
working capital cash
has been applied.
2. Income Statement
helps the preparation
1. The Statements
narrates the item of
cost and revenue to
arrive at the figures
of profit and loss
earned / incurred
during a particular
period of time.
2.
Cash
Flow
Statement
doesnt
of
Cash
Flow
Statement in as much
as one source of cash
help preparation of
i.e.,
cash
from
income statement
operation is found
out from the income
statement
3. Cash raised are
matched with cash
used. No distinction
is made between
capital and revenue
items
3.
Expenses
are
matched with income
in order to find out
the
result
of
operation.
Only
revenue items are
considered
Difference between Cash Flow Statement and Position Statement
Cash Flow Statement Position Statement

1. It is a Statement changes in financial
position.
1. It is statement of financial position
2. It shows the amount

of changes during the
particular period of
time.
2. It present the amount of assets and

liabilities at a particular point of time
3. It doesnt analyze
the change in current
asset
and
current
liability.
3. It shows all the accounting liabilities

whether current or non-current
4. It is a analytical
statement
analyzing
form where they have
been used, hence more
useful.
4. It is not a analytical statement hence

not that much useful for decision
making as the cash flow statement
Importance of cash flow statement:

The information which is provided by cash flow statement is neither available
in the balance sheet nor in the income statement and hence its important.
The
changes which have taken place in between two accounting dates are highlighted
by cash flow statement.
A lay man cannot grasp the underlying significance of
achievements and progress of the company simply by a personal of the balance

sheet and income statement of different years.
The comparative and analytical
study presented by the statement giving the details of sources and uses of cash
during a given period of immense help to the users of information. It is very useful
tool in analytical kit of the management also, besides the outsiders, in order to have
at a glance appraisal of the financial and operating performance of a company.
Uses of cash flow statement:

Cash flow statement of a company is of great value to management share
holders, creditors, bankers, money lending institutions etc.,
Informative value:- The financial consequence of business operation are

clearly explained in details by a cash flow statement some of the problems
which crop up in the minds of investors are well solved by a simple perusal of
this statement for e.g.,
3. Where have the profit gone.
4. Why does an imbalance exist between liquidity position and profitability
position of enterprise
Forecasting value:- A projected cash flow statement can be prepared and resources can
be properly allocated after an analysis of the present state of affairs. The optimal
utilization of available cash in necessary for the overall growth of the enterprise.
Testing value:- Whether the working capital has been effectively is used or not by the
management can well be tested by cash flow statement. Whether working capital has
been maintained at proper level, and whether it is adequate or inadequate can be known
by a study of the statement. The management is warned against the injudicious uses of
cash.
Decision-making value:-
Since over all credit worthiness of the enterprise is
known, creditors and money lenders can decide as to whether they have to provide
loans to company or not. The sources of raising cash and their application help the
shareholders to decide whether the management of the business is an enlightened or
not regarding managing cash.
Mismanagement of cash may be prevented.
The
management can be decide about the future financing policies and capital
expenditure programmers.
Statement of Change in working Capital

Particular
Previous
Year
Current Year
Change In Working
Capital
Increase
Decreas
e
urrent assets:
nventories:
******
******
aw material
******
******
onsumable stores
******
******
nished goods
******
******
undry debtors
******
******
ash in hand
******
******
alance with bank
******
******
******
******
******
******
******
******
ales tax
******
******
otal current assets
******
******
urrent liabilities
******
******
rade creditors
******
******
ealers deposits
******
******
xpenses payable
******
******
otal Current liabilities
******
******
******
******
ssets-current liabilities)
******
******
******
******
et Increase/decrease working capital
******
******
******
******
Other current assets:
eposits
ncome tax (advance tax)
Working capital (current
Structure of the Cash Flow Statement

The most commonly used format for the cash flow statement is broken down into
three sections: cash flows from operating activities, cash flows from investing
activities, and cash flows from financing activities.
Cash flows from operating activities are related to your principal line of business
and include the following:
Cash receipts from sales or for the performance of services
Payroll and other payments to employees
Payments to suppliers and contractors
Rent payments
Payments for utilities
Tax payments
Investing activities include capital expenditures disbursements that are not

charged to expense but rather are capitalized as assets on the balance sheet.
Investing activities also include investments (other than cash equivalents as
indicated below) that are not part of your normal line of business. These cash flows
could include:
Purchases of property, plant and equipment
Proceeds from the sale of property, plant and equipment
Purchases of stock or other securities (other than cash equivalents)
Proceeds from the sale or redemption of investments
Financing activities include cash flows relating to the businesss debt or equity
financing:
Proceeds from loans, notes, and other debt instruments
Installment payments on loans or other repayment of debts
Cash received from the issuance of stock or equity in the business
Dividend payments, purchases of treasury stock, or returns of capital
Direct Method:
Under the direct method, you are basically analyzing your cash and bank accounts
to identify cash flows during the period. You could use a detailed general ledger
report showing all the entries to the cash and bank accounts, or you could use the
cash receipts and disbursements journals. You would then determine the offsetting
entry for each cash entry in order to determine where each cash movement should
be reported on the cash flow statement.
Cash receipts from customers:
Net sales per the income statement
Plus beginning balance in accounts receivable
Minus ending balance in accounts receivable
Equals cash receipts from customers
Cash payments for inventory:
Ending inventory
Minus beginning inventory
Plus beginning balance in accounts payable to vendors
Minus ending balance in accounts payable to vendors
Equals cash payments for inventory
Cash paid to employees:
Salaries and wages per the income statement
Plus beginning balance in salaries and wages payable
Minus ending balance in salaries and wages payable
Equals cash paid to employees
Cash paid for operating expenses:
Operating expenses per the income statement
Minus depreciation expenses
Plus increase or minus decrease in prepaid expenses
Plus decrease or minus increase in accrued expenses
Equals cash paid for operating expenses
Taxes paid:
Tax expense per the income statement
Plus beginning balance in taxes payable
Minus ending balance in taxes payable
Equals taxes paid
Interest paid:
Interest expense per the income statement
Plus beginning balance in interest payable
Minus ending balance in interest payable
Equals interest paid
Under the direct method, for this example, you would then report the following in
the cash flows from operating activities section of the cash flow statement:
Cash receipts from customers
Cash payments for inventory
Cash paid to employees
Cash paid for operating expenses
Taxes paid
Interest paid
Equals net cash provided by (used in) operating activities
Indirect Method:
In preparing the cash flows from operating activities section under the indirect
method, you start with net income per the income statement, reverse out entries to
income and expense accounts that do not involve a cash movement, and show the
change in net working capital. Entries that affect net income but do not represent
cash flows could include income you have earned but not yet received, amortization
of prepaid expenses, accrued expenses, and depreciation or amortization. Under
this method you are basically analyzing your income and expense accounts, and
working capital. The following is an example of how the indirect method would be
presented on the cash flow statement:
Net income per the income statement
Minus entries to income accounts that do not represent cash flows
Plus entries to expense accounts that do not represent cash flows
Equals cash flows before movements in working capital
Plus or minus the change in working capital, as follows:

o
An increase in current assets (excluding cash and cash equivalents)

would be shown as a negative figure because cash was spent or
converted into other current assets, thereby reducing the cash balance.
A decrease in current assets would be shown as a positive figure,

because other current assets were converted into cash.
An increase in current liabilities (excluding short-term debt which would

be reported in the financing activities section) would be shown as a
positive figure since more liabilities mean that less cash was spent.
A decrease in current liabilities would be shown as a negative figure,

because cash was spent in order to reduce liabilities.
The net effect of the above would then be reported as cash provided by (used in)
operating activities.
The cash flows from investing activities and financing activities would be presented
the same way as under the direct method.
CHAPTER-IV
Statements showing the change in working capital for

2012-2013:
Particles
Mar '14
Mar '13
2,368.36
2350.47
Sundry Debtors
1,281.02
1017.24
277.5
142.66
Fixed deposits
3,926.88
11.71
Loans and Advances
2,521.99
2161.94
6448.87
5672.31
6810.76
6642.06
Provisions
972.96
1069.2
7783.72
7711.26
Net Working capital
-1334.85
-2038.95
Net increase\Decrease in
working capital
-704.1
Inventories
Current Liabilities
10,000.00
8,000.00
6,000.00
4,000.00
Mar '14
2,000.00
Mar '13
ca
pi
ta
l
et
W
or
ki
ng
N
Fix
ed
-4,000.00
de
po
s
-2,000.00
Cu
rre
nt
Li
ab
ilit
ie
s
its
In
ve
nt
or
ie
s
0.00
Calculation of operating profit for the period (2013-2014):
Amount Cr
2014
Amount Cr 2013
Net Profit
2144.47
2653.43
Add Depreciation
1052.26
945.37
Particular
Gross Cash generation

Less :- taxation For the year
Net Cash generation
3196.73
3600.8
631.04
1169.97
2565.69
2430.83

Source
Rs
Appal action
Rs
Secured loan
2398.35
Increase in gross Block
3684.15
Unsecured loan
2483.43
Secured loan Paid
2179.23
Cash From
operation
277.5
5159.28
Net Increase in working

capital
-704.1
5159.28
Interpretation:
increasing trend from Rs.69cr in 2013-2014. The net capital company stood at
2013-2014. Amount Rs.277.50. In the total cash flow 34.51% was received from cash
from operation, 38.94% received from secured loans and 23.67% was received from
unsecured loans.
Conclusion:
Particles
Mar '13
Mar '12
Inventories
2350.47
2035.94
Sundry Debtors
1017.24
765.96
142.66
176.48
Fixed deposits
11.71
11.71
Loans and Advances
2161.94
1511.73
5672.31
4501.82
6642.06
5599.74
1069.20
820.74
Current Liabilities
Provisions
7711.26
6420.48
Net Working capital
-2038.95
-1918.66
-120.29
10000
8000
6000
4000
Mar '13
2000
Mar '12
ca
pi
ta
l
N
et
W
or
ki
ng
its
Cu
rre
nt
Li
ab
ilit
ie
s
-4000
de
po
s
-2000
Fix
ed
In
ve
nt
or
ie
s

(2012-2013)
Particulars
Amount
Amount
(Cr)
(Cr)
2012
2012
Net profit
2655.43
Add: depreciation
2446.19
945.37

3348.75
902.56
3600.80
116.97
Net cash generated
3483.83
----
3348.75

Sources
Rs
Rs
Applications
Secured loans
2357.41
2147.34
Unsecured loans
2127.64
Cash from operation

-120.29
2315.34
142.66
Secured loans paid
Net
increase
in
Working Capital
4605.34
4605.34
Interpretation:
increasing trend from Rs.49crs in 2012-2013. The net capital company stood at
Rs.274318 in 2012-2013. And it is increased to. The decreasing working capital is
Conclusion:
Particles
Mar '12
Mar '11
Inventories
2035.94
1,956.52
Sundry Debtors
765.96
602.29
176.48
144.79
Fixed deposits
11.71
0.32
Loans and Advances
1511.73
1,055.10
4501.82
3920.31
5599.74
4772.07
Current Liabilities
Provisions
820.74
573.49
6420.48
5345.56
Net Working capital
-1918.66
-1,425.25
-493.41
7000
6000
5000
4000
3000
2000
Mar '12
1000
Mar '11
ca
pi
ta
l
et
W
or
ki
ng
its
-3000
de
po
s
-2000
Fix
ed
In
ve
nt
or
ie
s
-1000
Cu
rre
nt
Li
ab
ilit
ie
s

(2011-2012)
Particulars
Amount
Amount
(Cr)
(Cr)
2012
2011
Net profit
Add: depreciation
2446.19
1404.23
902.56
3348.75
Net cash generated
765.73
2169.96
----
3348.75
2169.96

Sources
Applications
Rs
Rs
Secured loans
1072.21
Unsecured loans
3405.81
Cash from operation
2012.09
1769.04
176.48
Secured loans paid
Net increase in
Working Capital
-493.41
3984.61
3984.61
Interpretation:
Rs.6420.48 in 2011-2012. And it is increased to. The increasing working capital is
Conclusion:
Particles
Mar '11
Mar '10
Inventories
1,956.52
821.70
Sundry Debtors
602.29
215.83
144.79
83.73
Fixed deposits
0.32
0.00
Loans and Advances
1,055.10
374.92
3920.31
1496.18
Current Liabilities
4772.07
1992.60
Provisions
573.49
161.01
5345.56
2,153.61
Net Working capital
-1,425.25
-657.43
-767.82
6,000.00
5,000.00
4,000.00
3,000.00
2,000.00
Mar '11
1,000.00
Mar '10
its
Cu
rre
nt
Li
ab
ilit
ie
s
N
et
W
or
ki
ng
ca
pi
ta
l
-2,000.00
de
po
s
-1,000.00
Fix
ed
In
ve
nt
or
ie
s
0.00

(2010-2011)
Particulars
Amount
Amount
Net profit
Add: depreciation
(Cr)
(Cr)
2011
2010
1404.23
1093.24
765.73
2169.96
Net cash generated
388.08
1481.32
----
2169.96
1481.32

Sources
Applications
Rs
Rs
Secured loans
9846.13
9846.13
Unsecured loans
-4789.24
Cash from operation
2789.76
1354.84
144.47
Secured loans paid
Net increase in
Working Capital
-767.82
4289.07
4289.07
Interpretation:

Conclusion:
Particles
Mar '10
Mar '09
Inventories
821.70
691.97
Sundry Debtors
215.83
186.18
83.73
104.49
Fixed deposits
0.00
0.00
Loans and Advances
374.92
395.71
1,496.18
1,378.35
Current Liabilities
1,992.60
1,860.59
Provisions
161.01
121.80
2,153.61
1,982.39
-657.43
-604.04
Net Working capital

-53.44
2500
2000
1500
1000
500
0
Mar '10
-1000
Mar '09
Ca
sh
In
ve
nt
or
an
ie
s
d
Ba
nk
Ba
la
Lo
nc
an
e
s
an
d
Ad
va
nc
es
Cu
rre
nt
N
Li
et
ab
in
T
ilit
ot
cr
ie
al
ea
s
CL
se
\D
&
ec
Pr
re
ov
as
is
io
e
ns
in
wo
rk
in
g
ca
pi
ta
l
-500
Calculation of operating profit For the period (200910)
Particulars
Amount
(Cr)
(Cr)
2010
Net profit
2009
1093.24
Add: depreciation
388.08
1481.32
Net cash generated

1300.02
Amount
977.02
323.00
1300.02
----
1481.32
FOR THE PERIOD (2009-2010)
Sources
Rs
Applications
Secured Loans
854.19
Sales Unsecured Loans
Unsecured loan
750.33
Gross Block
Cash From
operation
83.73
1688.25
INTERPRETATION:
Increasing in Working
Capital
Rs
677.12
1064.57
-53.44
1688.25
From the above table it is observed that the net working capital of the
company shows increased From Rs. -83.96 to Rs. -53.44 in 2009-.10
The net working capital of the company Rs. 83.96 in 2009-2010. And it is
increased . The increasing Working capital is recorded as Rs. 657.43.
It is evident from the above table the total cash flow during the period from
2009-10. Amount Rs 83.73. In the total cash flow 53.40% was received from cash
operation and 45.44% was received from unsecured loans (vehicles) and 1.15%
was received from secured loans.
Regarding the application of cash 3.99% used for repayment of unsecured
loans and 81.16% used for purchase of fixed assets and cash used for working
capital constitution 14.85% respective.
CONCLUSION:
It is concluded that during the period 2009-10 more than 53.4% of the cash
came trading activities 1.16% used in secured loans, 45 the application of cash
around 81.16% of the cash utilized for investing in fixed assets. And 3.99% used
for repayment of unsecured loans.
NET INCREASES IN WORKING CAPITAL:
YEAR
INCREASE / DECREASE
AMOUNT
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
INCREASE
DECREASE
INCREASE
DECREASE
DECREASE
-53.44
-767.82
-493.41
-120.29
-704.10
AMOUNT
0
-100
-200
-300
AMOUNT
-400
-500
-600
-700
-800
-900
The above table observed that the working capital Increased. In year 2009 14
the working capital has been increased. In the year 2013-14 the working capital is Rs704.10 Due to the increase in current liabilities the net working capital is increased.
Changes in cash from operations
YEAR
AMOUNT
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
1571.93
2074.26
3443.40
3825.40
2775.51
AMOUNT
4500
4000
3500
3000
2500
2000
1500
1000
500
0
20
14
20
13
-
20
13
20
12
-
20
12
20
11
-
20
11
20
10
-
20
09
-
20
10
AMOUNT
The above table explains that continuous

fluctuations in flow of cash from operation.
In the year 2009-10 the cash from operation is

increased .The cash from operation in the years
& it has increased. In the year 2013-14. The
cash from operation in the year 2013-14 is Rs.
2775.51.
USES & APPLICATION OF CASH
APPLICA
TION
2009-10
2010-11
2011-12
2012-13
2013-14
Increase
in
Gross
Block
677.12
9846.13
1072.21
2357.41
3684.15
----
3405.81
2127.64
2179.23
1356.84
1796.04
2315.34
2483.43
Secured
loans paid
1064.57
Unsecure
d loans
750.33
4000
3500
3000
APPLICATION
2500
2009-10
2011-12
2000
2012-13
1500
2013-14
1000
500
0
1
The above table shows that Gross block has increased to Rs. 3684.15 in 2013-14 &
Rs. 1072.21 in 2012-2013. The secured loans paid Rs.2179.23 in 201314
&Rs.2127.64 in 2009-10. The unsecured loans paid Rs.2483.43 in the year2013-14.
CHAPTER-V
FINDINGS
SUGGESSIONS
CONCLUSIONS
BIBLIOGRAPHY
FINDINGS:
came from trading activities. In the application of the cash around
78.94% of the cash are utilized for investing in fixed assets.
cash are utilize for the investing in fixed assets.
During the period 2013-14 more than 48.64% of the cash came from
trading activities. In the application of cash around 86% utilized for
investing in fixed assets.
During the period 2013-14 more than 75.34 % of the cash came from
trading activities. The application of cash around 74.88 % of the cash
was utilized for investing in fixed assets.
CONCLUSIONS:
Regarding the long-term funds to fixed assets they show an increase.

10.Regarding the total investment turnover ratio it is observed sales had an
increase from 2010-14.
11. Regarding the Fixed Asset turnover ratio, sales had an increased.
12.From the above study it can be said that the UltraTech Cement Limited
overall financial position on fixed assets is satisfactory.
13. The UltraTech Cement Limited Net Profit is showing negative profit in the year 200910. This event is an expected one because since from the previous two years it is showing
the decline stage in Net Profit.
14. Profit Margin of UltraTech Cement Limited is decreasing and showing negative profit
because there is increase in the price.
15. The UltraTech Cement Limited Net Working Capital Ratio is satisfactory.
16. The UltraTech Cement Limited return on Total Assets shows a posigative sign in the
year 2009-10.
17. The Operating Ratio of UltraTech Cement Limited increase in the year 2009-10, in the
year 2009-10and reached in the year 2013-14 so the company has to reduce its operating
costs.
18. The Operating cash of UltraTech Cement Limited satisfactory. Due to increase in cost
of production, this ratio is decreasing. So the has to reduce its office administration
expenses
SUGGESTIONS:
6) For the improving the financial performance of the company the

following suggestions are made.
7) In order to reduce the outside borrowings in the company has to
acquire. The capital from equity sources. Keeping in view the debt
equity the proportion as normal.
8) The liquidity of the company should be improved by maintaining the
optimum current assets and liquid assets according to standard norms.
9) The quantum of the sales generated should be improved impressively
in order to attain higher return on investment.
10)
To improve the financial health of the company and maximizing
the
time
between
the
source
mobilization
and
utilization
management must introduce the new cost saving techniques.
the
BIBLIOGRAPHY:
- I.M. Panday
- Prasanna Chandra
- M.Y. Khan & P.K. Jain
PRINCIPLES OF MANAGEMENT
- Man Mohan & Goyal S.N.
- Maheswari S.N.
Annual reports of ULTRATECH CEMENTS LIMITED-2013-14:
www.googlefinance.com
www.financeindia.com
www.cashflowstatement.com
www.ultratech.com
CHAPTER-I
INTRODUCTION
INTRODUCTION
Customer satisfaction:
satisfaction.
A business term, is a measure of how products and services supplied by a company meet
or surpass customer expectation. It is seen as a key performance indicator within business and is
part of the four of a Balanced Score motors.
In a competitive marketplace where businesses compete for customers, customer

satisfaction is seen as a key differentiator and increasingly has become a key element of business
strategy.
There is a substantial body of empirical literature that establishes the benefits of customer
satisfaction for firms.
Automobile Industry:
Industry that produces
automobiles and other gasoline-powered vehicles,
such as buses, trucks, and motorcycles. The automobile industry is one of the most
important industries in the world, affecting not only the economy but also the
cultures of the world. It provides jobs for millions of people, generates billions of
dollars in worldwide revenues, and provides the basis for a multitude of related
service and support industries. Automobiles revolutionized transportation in the
20th century, changing forever the way people live, travel, and do business.
The automobile has enabled people to travel and transport goods farther and faster, and
has opened wider market areas for business and commerce. The auto industry has also reduced
the overall cost of transportation by using methods such as mass production (making several
products at once, rather than one at a time), mass marketing (selling products nationally rather
than locally), and globalization of production (assembling products with parts made worldwide).
From 1886 to 1898, about 300 automobiles were built, but there was no real established industry.
A century later, with automakers and auto buyers expanding globally, auto making became the
world's largest manufacturing activity, with nearly 58 million new vehicles built each year
worldwide.
As a result of easier and faster transportation, the United States and world economies
have become dependent on the mobility that automobiles, trucks, and buses provide. This
mobility allowed remote populations to interact with one another, which increased commerce.
The transportation of goods to consumers and consumers to goods has become an industry in
itself. The automobile has also brought related problems, such as air pollution, the emission of
greenhouse gases that contribute to global warming, congested traffic, and highway fatalities.
Nevertheless, the automobile industry continues to be an important source of employment and

transportation for millions of people worldwide.
Automobile India:
The history of the automobile industry in India actually began about 4,000
years ago when the first wheel was used for transportation. In the early 15th
century, the Portuguese arrived in China and the interaction of the two cultures led
to a variety of new technologies, including the creation of a wheel that turned under
its own power. By the 1600s, small steam-powered engine models were developed,
but it was another century before a full-sized engine-powered automobile was
created.
The dream a motors age that moved on its own was realized only in the 18th
century when the first motors rolled on the streets. Steam, petroleum gas,
electricity and petrol started to be used in these MOTORSs.
The automobile, as it progressed, was a product of many hands, of

revolutionary concepts, and of simple, almost unnoticed upgrading. India's transport
network is developing at a fast pace and the automobile industry is growing too.
The automobile industry also provides employment to a large section of the
population. Thus the role of automobile industry cannot be overlooked in Indian
Economy. All kinds of vehicles are produced by the automobile industry. It includes
the manufacture of trucks, buses, passenger motors, defense vehicles, twowheelers, etc. The industry can be broadly divided into the motors manufacturing,
two-wheeler manufacturing and heavy vehicle-manufacturing units.
NEED AND IMPORTANCE OF THE STUDY:

The Indian automobile industry is witnessing changes like never
before. The Indian consumer is changing with new players entering the market and
increasing availability of service, the consumer is demanding more. Now the
question is where TATA Motors stands in this scenario? TATA Motors is the only
company that maintenance good relationship with their customers and providing
good service, well as presenting the market with a range of motors by motors by
introducing different models, and to provide better after sales service to their
customers. TATA Motors has increased its service stations all over the country, and
thats why TATA Motors is ranked as No.1 in customer satisfaction. And to maintain
relationship with their customers TATA Motors is providing 24 hours service to their
customers after introducing May services, how fast the consumer is satisfying with
it, and to know after sales service of TATA motors owners opinion on the service
and the performance of the dealer.
OBJECTIVES OF STUDY:
To know the customer perception towards the service
To know the factors influencing the customers after sales service of the TATA
Motors (AUTOFIN LIMITED).
To know whether the customer is satisfied with dealer renders after sales
service, how fast the consumer is satisfied with it..
To know the customers reaction for the dealer performance on TATA Motors
(AUTOFIN LIMITED).
To know whether the customer problem is resolving completely at service

station.
To know whether the vehicle is delivering on time to the customers.
To know whether the TATA Motors (AUTOFIN LIMITED) given benefits to

the customer.
SCOPE OF THE STUDY:
The scope is very limited because attitude of the people change according to
the time.
The scope of project work is to get the opinions from respondents on the
issues mentioned earlier.
It is limited to the twin cities of Hyderabad and is confined to the urban areas
as the respondents are the subscribers of TATA Motors (AUTOFIN
LIMITED)is one form or the other.
RESEARCH METHODOLOGY:
Research is the plan structure & strategy for investigation conceived to
answer to research question & control variance. It is the overall operation pattern to
framework of project that stipulated the information to be collected from which
sources by word procedure. What are the two possible sources of data for securing
in the above mentioned information in the primary & secondary data.
Research design:
The study undertaken to access the after sales service of TATA owners in
Hyderabad and R.R.Dist.
Research procedure:
The questionnaire designed for the study in the structured & disguised in
nature. It consists of multiple choice & short questions.
Data:
Information required for the project is mainly primary data. The information
was collected by survey method. With the help of questionnaire by meeting various
motors owners (TATA).
Secondary data is collected form the company journals, magazines,

broachers & websites.
Sample design:
The sampling unit was confined to end consumers of the product i.e. TATA
motors owners to know there satisfaction level regarding performance of motors
performance of motors and service.
Sample universe:
The survey was done in Hyderabad and R.R.Dist only according to my
convenience. It is not giving the complete picture of Andhra Pradesh (or) India.
Sample frame/unit: professionals, business people, employees etc
Sample size:
The total sample size is 100 only.
Sample method:
The information is planned to be collected by sample method, the sample
method followed is random sampling method. The probability random sampling
method is stratified random sampling.
Analytical Method:
Simple percentage method is used for the analysis purpose.
Period of study:
Study is during the month of January & February 2015.
Data collection:
The information is collected through questionnaires and personal interviews.

And the information of customers is known by companys service sheet and the free
service sheet.
A Direct structure questionnaire has been asked to all the respondents in the
sample followed by direct personal interviews.
Descriptive Studies:
In descriptive studies, when the researcher is interested in knowing the
characteristics of certain groups such as age. Sex, educational level occupation of
income, a descriptive study is necessary. Descriptive studies are well structured. It
is therefore, necessary that the researcher gives sufficient thought to framing
research questions and deciding the types of data to he collected and the procedure
to be used for this purpose-The objective of such a study is to answer the who,
what and how of the subject under investigation.
SOURCES OF DATA:
A classification of data is very important procedure in this concept. The
collected data can be classified into two types.
16.
primary data
17.
secondary data
Primary data:
The primary data is very important source for to make suggestions to the title
obtained. This data can be collected in various methods like survey, interviewing,
feedback, i.e. Group Discussion etc., for collection of primary data the survey
method
is
used,
which
involved
predetermined
questions.
The
structured
questionnaire contained a form list of question framed so as to get the facts. But it
involves high risk and huge expensive method to get the facts.
Secondary Data:
Collection of secondary data is very easy compared with primary data. But
this data is also very important for the growth of an organization, to predict the
future and will help to make the future plan regarding sales and improve the
measures of sales.
This data can be collected from the magazines. Annual reports of the
organization and other published data.
Sample procedure:
The sample size consists of 100 consumers. The sample consists of
Businessman, Doctors, Engineers, Officers and Contractors etc.
The survey was conducted in the form of an interview among randomly
chosen sample of 100 consumers of TATA customers Sample size form the dealer
randomly.
The study is restricted to both Hyderabad and Ranga Reddy Dist and that to
among 100 respondents.
The study is conducted for 45 days.
The study is restricted to certain area. So it could not give an accurate picture
about Andhra Pradesh of India.
The Accuracy Of The Answers Depends Upon The Mode Of Interest Of

Respondents.
Though the customers wanted to give information they could not, as they
felt it takes away their business time.
The accuracy of the answers depends upon the mode of interest of

respondents.
The opinions of the sample may or may not depict the exact opinions of the
total population.
CHAPTER-II
INDUSTRY PROFILE &
COMPANY PROFILE
INDUSTRY PROFILE
Introduction:
The automobile industry is one of Indias most vibrant and growing industries.
This industry accounts for 22 per cent of the country's manufacturing gross
domestic product (GDP). The auto sector is one of the biggest job creators, both
directly and indirectly. It is estimated that every job created in an auto company
leads to three to five indirect ancillary jobs.
2020.
The next few years are projected to show solid but cautious growth due to improved
affordability, rising incomes and untapped markets. With the governments backing,
and trends in the international scenario such as the decline in prices of natural
rubber, the Indian automobile industry is slated to witness some major growth.
Market size:
The cumulative foreign direct investment (FDI) inflows into the Indian
automobile industry during the period April 2000 August 2014 was recorded at
US$ 10,119.68 million, as per data by Department of Industrial Policy and Promotion
(DIPP).
Data from industry body Society of Indian Automobile Manufacturers (SIAM)
showed that 137,873 passenger cars were sold in July 2014 compared to 131,257
units during the corresponding month of 2013. Among the auto makers, Maruti
Suzuki, Hyundai Motor India and Honda Cars India emerged the top three gainers
with sales growth of 15.45 per cent, 12 per cent and 11 per cent, respectively.
The three-wheeler segment posted a 24 per cent growth to 51,461 units on
the back of increased demands from the urban market. Total sales across different
Scooter sales have jumped by 29 per cent in the ongoing fiscal, and now form
27 per cent of the total two-wheeler market from just 8 per cent a decade back. The
ever-rising demand for scooters, which has far outstripped supply has prompted
Honda to set up its first dedicated scooter plant in Ahmedabad.
Tractor sales in the country is expected to grow at a compound annual growth rate
(CAGR) of 89 per cent in the next five years making India a high-potential market
for many international brands.
Investments:
To match production with demand, many auto makers have started to invest
heavily in various segments in the industry in the last few months. Some of the
major investments and developments in the automobile sector in India are as
follows:

range with a few more offerings.
Yamaha Motor Co has restructured its business in India. Now, Yamaha Motor
India (YMI) will take care of its India operations. The restructuring is part of
Yamahas mid-term plan aimed at improving organisational efficiency, as per
Mr Hiroyuki Suzuki, Chief Executive and Managing Director. YMI would be
responsible for corporate planning and strategy, business planning and
business expansion, quality control, and regional control of Yamaha India
Business.
Tata Motors plans to use the 'hub-and-spoke' model in which India will be the
key manufacturing base while it will have mini-hubs in overseas markets. The
company also plans to set up mini hubs in potential markets like Africa,
Middle-East and South East Asia.
The Government of India encourages foreign investment in the automobile

sector and allows 100 per cent FDI under the automatic route. To boost
manufacturing, the government had lowered excise duty on small cars,
motorcycles, scooters and commercial vehicles to eight per cent from 12 per cent,
on sports utility vehicles to 24 per cent from 30 per cent, on mid-segment cars to 20
per cent from 24 per cent and on large-segment cars to 24 per cent from 27 per
cent.
The governments decision to resolve VAT disputes has also resulted in the
top Indian auto makers namely, Volkswagen, Bajaj Auto, Mahindra & Mahindra and
Tata Motors announcing an investment of around Rs 11,500 crore (US$ 1.87 billion)
in Maharashtra.
The Government of India-appointed SIAM and Automotive Components
Road Ahead:
The future of the auto industry depends on the positive sentiments and the
demand for vehicles in the market. With the festival season coming up, the Indian
auto sector will see a rise in demand which is expected to bring in major growth. An
auto dealer survey by firm UBS suggested that the Indian auto industry, riding on
trends like the upcoming festival season and decline in fuel price, will observe a 12
per cent y-o-y growth in FY15.
Also, keeping up with international trends, there is expected to be a surge in
the number of hybrid vehicles in the Indian auto sector in the years to come.
When other segments like passenger cars and commercial vehicles logged
negative growth, the two-wheeler makers registered around 13 percent growth
between January and October. Riding on the two-wheeler sector's growth, the
automotive industry grew 9.8 percent by volume year-on-year (YoY) between
January and October.
"The two-wheeler segment is the only one that has clocked positive growth at
12.9 percent YoY (year-on-year) to reach sales of nearly 13.5 million units by
October. This can be attributed to the low cost of two wheelers
In India," Vijay Kakade, vice president for automotive and transportation practice
at Frost & Sullivan, told IANS.

He said the light commercial vehicle (LCV) segment has been the worst hit,
with sales reducing to approximately 330,000 units -- an 18.9 percent YoY fall over
2013.
"The passenger car, medium and heavy commercial vehicle segments
contracted by 0.8 and 6.5 percent respectively during the period, compared to
2013. The reduction in sales can be attributed to the slowdown and the high interest
rates set by the RBI (Reserve Bank of India) reducing the availability of finance
options to the public," Kakade added.
"These segments have shown positive signs over the past few months, which is
expected to lead to growth in the next year."
"Although fuel prices have started coming down significantly, the enquiry levels
at showrooms have come down and conversions are not taking place at all. The
sales of diesel vehicles are also tapering off because of the narrowing price gap visa-vis petrol," Balendran added.
Expecting the government to continue with a lower excise duty regime for
small/mid-sized/big cars and sports utility vehicles (SUV) till March 2015, Balendran
said the rates should be continued till the Goods and Services Tax ( GST) is
introduced -- aiding the turnaround of the auto sector.
"The industry is looking forward to the budget for pro-business policies to
reignite the automobile industry in India."

October.
October
Auto manufacturers have been trying to cope with economical rough patch in
last two years. Trying to boost sales and implementing cost effective schemes just
sentence).
Tata Motors apart from giving customers attractive offers, gave 600 of their
employees early retirement offers, last month. Ashok Leyland too offered 500 of
their employees with irresistible retirement schemes, last year (pun intended).
Sales of Cars, SUVs, Vans, pick-ups, and entire commercial vehicle segment
went south, with passenger vehicle market encountering first decline in the decade.
But what saved the overall scenario was the two-wheeler market. It took 7.31% hike
The downtrend left auto manufacturers with piled up inventory and

stagnation. The interim budget announced in February, gave a minor boost as all
vehicles prices were reduced marginally, but it hasnt exactly helped boost sales
yet. Automakers are expecting aid from the governments new budget by way of
further tax cuts.
Launch of new A segment compact cars by various auto majors seems to be
helpful in this economy, for customers as well as value chain entities. Maruti Suzuki
finished top on podium with 42% share in overall car sales, followed by Hyundai
with 15% share.
Society of Indian Automobile Manufacturers (SIAM) expects a 6% growth over
in the fiscal 2014-15, with boost in manufacturing sector, new investment and fresh
COMPANY PROFILE
COMPANY PROFILE:
The Tata group comprises over 100 operating companies in seven business
sectors: communications and information technology, engineering, materials,
services, energy, consumer products and chemicals. The group has operations in
more than 100 countries across six continents, and its companies export products
and services to 150 countries.
Founded by Jamsetji Tata in 1868, the Tata group is a global enterprise
headquartered in India, and comprises over 100 operating companies, with
operations in more than 100 countries across six continents, exporting products and
services to over 150 countries. The revenue of Tata companies, taken together, was
$103.27 billion (around Rs624,757 crore) in 2013-14, with 67.2 percent of this
coming from businesses outside India. Tata companies employ over 581,000 people
worldwide.
Every Tata company or enterprise operates independently. Each of these
companies has its own board of directors and shareholders, to whom it is
answerable. There are 32 publicly listed Tata enterprises and they have a combined
market capitalisation of about $107.60 billion (as on January 30, 2014), and a
shareholder base of 3.9 million. The major Tata companies are Tata Steel, Tata
Motors, Tata Consultancy Services (TCS), Tata Power, Tata Chemicals, Tata Global
Beverages, Tata Teleservices, Titan, Tata Communications and Indian Hotels.
Tata Steel is among the top ten steelmakers, and Tata Motors is among the
top five commercial vehicle manufacturers, in the world. TCS is a leading global
software company, with delivery centres in the US, UK, Hungary, Brazil, Uruguay
and China, besides India. Tata Global Beverages is the second-largest player in tea
in the world. Tata Chemicals is the worlds second-largest manufacturer of soda ash
and Tata Communications is one of the worlds largest wholesale voice carriers.
In tandem with the increasing international footprint of Tata companies, the
Tata brand is also gaining international recognition. Brand Finance, a UK-based
consultancy firm, valued the Tata brand at $18.16 billion and ranked it 39th among
the top 500 most valuable global brands in their BrandFinance Global 500 2013
report. In 2010, BusinessWeek magazine ranked Tata 17th among the '50 Most
Innovative Companies' list.
Tata companies have always believed in returning wealth to the society they
serve. Two-thirds of the equity of Tata Sons, the Tata promoter holding company, is
held by philanthropic trusts that have created national institutions for science and
technology, medical research, social studies and the performing arts. The trusts also
provide aid and assistance to non-government organisations working in the areas of
education, healthcare and livelihoods. Tata companies also extend social welfare
activities to communities around their industrial units.
Going forward, Tata is focusing on new technologies and innovation to drive
its business in India and internationally. The Nano car is one example, as is the Eka
supercomputer (developed by another Tata company), which in 2008 was ranked
the worlds fourth fastest. Anchored in India and wedded to traditional values and
strong ethics, Tata companies are building multinational businesses that will achieve
growth through excellence and innovation, while balancing the interests of
shareholders, employees and civil society.
Tata Motors Limited is Indias largest automobile company, with consolidated
revenues of INR 2,32,834 crores (USD 38.9 billion) in 2013-14. It is the leader in
commercial vehicles in each segment, and among the top in passenger vehicles
with winning products in the compact, midsize car and utility vehicle segments.
The Tata Motors Groups over 60,000 employees are guided by the mission
to be passionate in anticipating and providing the best vehicles and experiences
that excite our customers globally.''
Established in 1945, Tata Motors presence cuts across the length and
breadth of India. Over 8 million Tata vehicles ply on Indian roads, since the first
rolled out in 1954. The companys manufacturing base in India is spread across
Jamshedpur (Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh), Pantnagar
(Uttarakhand), Sanand (Gujarat) and Dharwad (Karnataka). Following a strategic
alliance with Fiat in 2005, it has set up an industrial joint venture with Fiat Group
Automobiles at Ranjangaon (Maharashtra) to produce both Fiat and Tata cars and
Fiat powertrains. The companys dealership, sales, services and spare parts network
comprises over 6,600 touch points, across the world.
Tata Motors, also listed in the New York Stock Exchange (September 2004),
has emerged as an international automobile company. Through subsidiaries and
associate companies, Tata Motors has operations in the UK, South Korea, Thailand,
South Africa and Indonesia. Among them is Jaguar Land Rover, acquired in 2008. In
2004, it acquired the Daewoo Commercial Vehicles Company, South Korea's second
largest truck maker. The rechristened Tata Daewoo Commercial Vehicles Company
has launched several new products in the Korean market, while also exporting these
products to several international markets. Today two-thirds of heavy commercial
vehicle exports out of South Korea are from Tata Daewoo. In 2006, Tata Motors
formed a 51:49 joint venture with the Brazil-based, Marcopolo, a global leader in
body-building for buses and coaches to manufacture fully-built buses and coaches
for India - the plant is located in Dharwad. In 2006, Tata Motors entered into joint
venture with Thonburi Automotive Assembly Plant Company of Thailand to
manufacture and market the company's pickup vehicles in Thailand, and entered
the market in 2008. Tata Motors (SA) (Proprietary) Ltd., Tata Motors' joint venture
with Tata Africa Holding (Pty) Ltd. set up in 2011, has an assembly plant in Rosslyn,
north of Pretoria. The plant can assemble, semi knocked down (SKD) kits, light,
medium and heavy commercial vehicles ranging from 4 tonnes to 50 tonnes.
Tata Motors is also expanding its international footprint, established through
exports since 1961. The company's commercial and passenger vehicles are already
being marketed in several countries in Europe, Africa, the Middle East, South East
Asia, South Asia, South America, CIS and Russia. It has franchisee/joint venture
assembly operations in Bangladesh, Ukraine, and Senegal.
The foundation of the company's growth over the last 68 years is a deep
understanding of economic stimuli and customer needs, and the ability to translate
them into customer-desired offerings through leading edge R&D. With over 4,500
engineers, scientists and technicians the company's Engineering Research Centre,
established in 1966, has enabled pioneering technologies and products. The
company today has R&D centres in Pune, Jamshedpur, Lucknow, Dharwad in India,
and in South Korea, Italy, Spain, and the UK.
It was Tata Motors, which launched the first indigenously developed Light
Commercial Vehicle in 1986. In 2005, Tata Motors created a new segment by
launching the Tata Ace, India's first indigenously developed mini-truck. In 2009, the
company launched its globally benchmarked Prima range of trucks and in 2012 the
Ultra range of international standard light commercial vehicles. In their power,
speed, carrying capacity, operating economy and trims, they will introduce new
benchmarks in India and match the best in the world in performance at a lower lifecycle cost.
Tata Motors also introduced India's first Sports Utility Vehicle in 1991 and, in
1998, the Tata Indica, India's first fully indigenous passenger car.
In January 2008, Tata Motors unveiled its People's Car, the Tata Nano. The
Tata Nano has been subsequently launched, as planned, in India in March 2009, and
subsequently in 2011 in Nepal and Sri Lanka. A development, which signifies a first
for the global automobile industry, the Nano brings the joy of a car within the reach
of thousands of families.
Tata Motors is equally focussed on environment-friendly technologies in
emissions and alternative fuels. It has developed electric and hybrid vehicles both
for personal and public transportation. It has also been implementing several
environment-friendly
technologies
in
manufacturing
processes,
significantly
enhancing resource conservation.

Through its subsidiaries, the company is engaged in engineering and
automotive solutions, automotive vehicle components manufacturing and supply
chain activities, vehicle financing, and machine tools and factory automation
solutions.
Tata Motors is committed to improving the quality of life of communities by
working on four thrust areas - employability, education, health and environment.
The activities touch the lives of more than a million citizens. The company's support
on education and employability is focused on youth and women. They range from
schools to technical education institutes to actual facilitation of income generation.
In health, the company's intervention is in both preventive and curative health care.
The goal of environment protection is achieved through tree plantation, conserving
water and creating new water bodies and, last but not the least, by introducing
appropriate technologies in vehicles and operations for constantly enhancing
environment care.
2015
Vistara takes to the skies
Prime Minister of India, Narendra Modi, releases commemorative coin to

mark the 175th birth anniversary of Jamsetji Nusserwanji Tata
2014
Tata Sons sets up office in Singapore as base for Asean region
WWF-India and Tata Housing unveil first-ever crowd-funding campaign for

species conservation in India
Tata Chemicals celebrates 75 years of glorious presence
Tata Motors unveils the all-new Zest and Bolt
Voltas and Dow Chemical Pacific (Singapore) join forces in India
Tata headquarters is India's first heritage building to get prestigious green

rating
Land Rover debuts invisible car technology
TCS and Mitsubishi Corporation join forces, create strategic Japanese IT

services company
Tata Global Beverages' UK subsidiary acquires 100 percent equity stake in

Earth Rules, Australia
Tata Power crosses 500 MW landmark of renewable energy generation

capacity
Tata Power Solar successfully commissions Indias largest solar power

project with NTPC
Jaguar Land Rover develops the self-learning intelligent car of the future
Pilatus and Tata Advanced Systems announce the manufacturing of PC-12

'Green Aircraft' aerostructures in India
Tata ClassEdge crosses 10,000 classrooms milestone
CMC amalgamates with TCS
First Land Rover Discovery Sport rolls off the production line securing 3.5
billion in UK supplier contracts
Tata Motors celebrates 60 years of truck manufacturing in Jamshedpur
Tata Power Solar completes 25 years of harnessing solar power to

transform lives
2013
Tata Motors Jamshedpur plant rolls out its two millionth truck
Tata Power synchronises fifth 800MW unit and makes its first UMPP of
4,000MW, at Mundra, fully operational

Tata Sons announces formation of the Group Executive Council
Tata Technologies acquires Cambric, a premier US-based engineering
services company
TCS acquires IT services firm Alti to help drive long-term growth in France
Titan Industries is now Titan Company
Tata Sons and Singapore Airlines to establish new airline in India
Mount Everest Mineral Water (MEMW) to be merged with Tata Global
Beverages
Jaguar Land Rover celebrates 1,000,000 vehicles built at Halewood
operations
Tata Toyo and Air International enter into a joint venture
Titan Company celebrates retail milestone with 1,000 stores
2012
Tata Global Beverages and Starbucks form joint venture to open Starbucks
cafs across India. First outlet launched in October in Mumbai

Tata Communications completes worlds first wholly-owned cable network
ring around the world

Indias first iodine plus iron fortified salt launched by Tata Chemicals
Tata AIG Life Insurance Company to be now called Tata AIA Life Insurance
2011
Tata Chemicals rebrands its global subsidiaries in the UK, the US and
Kenya under the Tata Chemicals corporate brand

The Tata brand soars into the top 50 club of global brands
Tata Medical Center, a comprehensive cancer care and treatment facility
established in Kolkata, was inaugurated by Tata Sons Chairman Ratan Tata

The Tata Nano begins international journey in Sri Lanka and Nepal
Jaguar celebrates 50 years of iconic E-Type car
Tata Steel completes centenary of its first blast furnace
Tata BP Solar becomes wholly owned Tata company (now known as Tata
Power Solar Systems)
2010
TRF acquires UK-based Hewitt Robins International

New plant for Tata Nano at Sanand inaugurated
Advinus Therapeutics announces the discovery of a novel molecule
GKM-001 for the treatment of type II diabetes

Tata Tea announces joint venture with PepsiCo for health drinks
Tata Tea group rebrands itself as Tata Global Beverages, headquartered in
London
Tata Chemicals acquires 100-per-cent stake in leading vacuum salt
producer British Salt, UK

Tata Chemicals launches i-Shakti dals, India's first national brand of pulses
2009
Tata Motors announces commercial launch of the Tata Nano; delivers first
Tata Nano in the country in Mumbai

Tata Teleservices announces pan-India GSM service with NTT DOCOMO
TRF acquires Dutch Lanka Trailer Manufacturers (DLT), Sri Lanka, a world-
class trailer manufacturing company

Jaguar Land Rover introduces its premium range of vehicles in India
Tata Chemicals launches Tata Swach the worlds most cost-effective
water purifier
Tata Housing makes waves with its launch of low cost housing in Mumbai
2008
Tata Motors unveils Tata Nano, the Peoples Car, at the 9th Auto Expo in
Delhi on January 10, 2008

Tata Motors acquires the Jaguar and Land Rover brands from the Ford
Motor Company
Tata Chemicals acquires General Chemical Industrial Products Inc (now
known as Tata Chemicals North America)
Company
Starbucks opens spectacular flagship store in Mumbai, honouring the
dynamic culture of India

Tetley Tea celebrates 175th anniversary
Tata Steel expands aerospace activities in China
Cyrus P Mistry takes over as Chairman, Tata Sons from Ratan N Tata
Board of Directors
Mr. Mistry with the Safari Storme
Mr. Kant with the Ultra
Mr. Wadia with the Range Rover Evoque
Mr. Cyrus P. Mistry
Non-Executive Director and Chairman
Mr. Mistry was appointed as a Director of Tata Motors with effect from May 29,
2012, and as Deputy Chairman of the Company with effect from November 7, 2012.
Mr. Mistry took over as Chairman from Mr. Ratan N. Tata on his retirement with
effect from December 28, 2012.
Mr. Mistry was earlier Managing Director of the Shapoorji Pallonji group and
was also responsible for building the infrastructure development vertical in the
Shapoorji Pallonji group.
Mr. Mistry is a Graduate of Civil Engineering from the Imperial College London
(1990) and has an MSc in Management from the London Business School (1997). He
was recently bestowed with the Alumni Achievement Award by the London Business
School.
Mr. Ravi Kant
Non-Executive Director and Vice Chairman
Mr. Kant has been with the Company since February 1999, joining as Senior
Vice President (Commercial Vehicles), and was inducted on the Board as an
Executive Director in July 2000 and became the Managing Director in July 2005.
Upon retiring from his Executive position on June 1, 2009, Mr. Ravi Kant continues to
be on the Companys Board of Directors as Vice-Chairman.
Prior to joining the Company, he was with Philips India Limited as Director of
Consumers Electronics business and prior to which with LML Ltd. as Senior
Executive Director (Marketing) and Titan Watches Limited as Vice President (Sales &
Marketing).
Mr. Ravi Kant holds a Bachelor of Technology degree in Metallurgical
Engineering from the Institute of Technology, Kharagpur and a Master's degree in
Science from the University of Aston, Birmingham, UK.
Mr. Nusli N. Wadia

Educated in the UK, Mr. Wadia is the Chairman of the Bombay Dyeing &
Manufacturing Company Limited and heads the Wadia Group. He is also the
Chairman/ Trustee of various charitable institutions and non-profit organisations.
Mr. Wadia has been on the Companys Board since December 1998 as an
Independent Director.
Dr. Raghunath A. Mashelkar
Dr. Mashelkar is an eminent chemical engineering scientist retired from the
post of Director General from the CSIR and is the President of Indian National
Science Academy (INSA), National Innovation Foundation, Institution of Chemical
Engineers, UK and Global Research Alliance. The President of India honoured Dr.
Mashelkar with the Padmashri (1991) and the Padmabhushan (2000). Dr. Mashelkar
holds a Ph.D. in Chemical Engineering from the Bombay University.
He was appointed as an Independent Director of the Company w.e.f. August
28, 2007.
National interest:
The Tata group is committed to benefit the economic development of the
countries in which it operates. No Tata company shall undertake any project or
activity to the detriment of the wider interests of the communities in which it
operates.
A Tata companys management practices and business conduct shall benefit
the country, localities and communities in which it operates, to the extent possible
and affordable, and shall be in accordance with the laws of the land.
A Tata company, in the course of its business activities, shall respect the
culture, customs and traditions of each country and region in which it operates. It
shall conform to trade procedures, including licensing, documentation and other
necessary formalities, as applicable.
Financial reporting and records:

A Tata company shall prepare and maintain its accounts fairly and
accurately and in accordance with the accounting and financial reporting standards
which represent the generally accepted guidelines, principles, standards, laws and
regulations of the country in which the company conducts its business affairs.
Internal accounting and audit procedures shall reflect, fairly and accurately,
all of the companys business transactions and disposition of assets, and shall have
internal controls to provide assurance to the companys board and shareholders
that the transactions are accurate and legitimate. All required information shall be
accessible to company auditors and other authorised parties and government
agencies.There shall be no willful omissions of any company transactions from the
books and records, no advance-income recognition and no hidden bank account and
funds.
Any willful, material misrepresentation of and / or misinformation on the
financial accounts and reports shall be regarded as a violation of the Code, apart
from inviting appropriate civil or criminal action under the relevant laws. No
employee shall make, authorise, abet or collude in an improper payment, unlawful
commission or bribing.
Competition:
A Tata company shall fully support the development and operation of
competitive open markets and shall promote the liberalisation of trade and
investment in each country and market in which it operates. Specifically, no Tata
company or employee shall engage in restrictive trade practices, abuse of market
dominance or similar unfair trade activities.
A Tata company or employee shall market the companys products and
services on their own merits and shall not make unfair and misleading statements
about competitors products and services. Any collection of competitive information
shall be made only in the normal course of business and shall be obtained only
through legally permitted sources and means.
Equal opportunities employer:

A Tata company shall provide equal opportunities to all its employees and
all qualified applicants for employment without regard to their race, caste, religion,
colour, ancestry, marital status, gender, sexual orientation, age, nationality, ethnic
origin or disability.
Human resource policies shall promote diversity and equality in the
workplace, as well as compliance with all local labour laws, while encouraging the
adoption of international best practices.
Employees of a Tata company shall be treated with dignity and in accordance
with the Tata policy of maintaining a work environment free of all forms of
harassment, whether physical, verbal or psychological. Employee policies and
practices shall be administered in a manner consistent with applicable laws and
other provisions of this Code, respect for the right to privacy and the right to be
heard, and that in all matters equal opportunity is provided to those eligible and
decisions are based on merit.
Gifts and donations:

A Tata company and its employees shall neither receive nor offer or make,
directly or indirectly, any illegal payments, remuneration, gifts, donations or
comparable benefits that are intended, or perceived, to obtain uncompetitive
favours for the conduct of its business. The company shall cooperate with
governmental authorities in efforts to eliminate all forms of bribery, fraud and
corruption.
However, a Tata company and its employees may, with full disclosure, accept
and offer nominal gifts, provided such gifts are customarily given and / or are of a
commemorative nature. Each company shall have a policy to clarify its rules and
regulations on gifts and entertainment, to be used for the guidance of its
employees.
Government agencies:
A Tata company and its employees shall not, unless mandated under
applicable laws, offer or give any company funds or property as donation to any
government agency or its representative, directly or through intermediaries, in
order to obtain any favourable performance of official duties. A Tata company shall
comply with government procurement regulations and shall be transparent in all its
dealings with government agencies.
Political non-alignment:
A Tata company shall be committed to and support the constitution and
governance systems of the country in which it operates.
A Tata company shall not support any specific political party or candidate for
political office. The companys conduct shall preclude any activity that could be
interpreted as mutual dependence / favour with any political body or person, and it
shall not offer or give any company funds or property as donations to any political
party, candidate or campaign.
Health, safety and environment:

A Tata company shall strive to provide a safe, healthy, clean and
ergonomic working environment for its people. It shall prevent the wasteful use of
natural resources and be committed to improving the environment, particularly with
regard to the emission of greenhouse gases, and shall endeavour to offset the effect
of climate change in all spheres of its activities.
A Tata company, in the process of production and sale of its products and
services, shall strive for economic, social and environmental sustainability.
Quality of products and services:

A Tata company shall be committed to supply goods and services of worldclass quality standards, backed by after-sales services consistent with the
requirements of its customers, while striving for their total satisfaction. The quality
standards of the companys goods and services shall meet applicable national and
international standards.
A Tata company shall display adequate health and safety labels, caveats and
other necessary information on its product packaging.
Corporate citizenship:
A Tata company shall be committed to good corporate citizenship, not only in
the compliance of all relevant laws and regulations but also by actively assisting in
the improvement of quality of life of the people in the communities in which it
operates.
The company shall encourage volunteering by its employees and
collaboration with community groups.

Tata companies are also encouraged to develop systematic processes and
conduct management reviews, as stated in the Tata corporate sustainability
protocol, from time to time so as to set strategic direction for social development
activity.
The company shall not treat these activities as optional, but should strive to
incorporate them as an integral part of its business plan.
Cooperation of Tata companies:

A Tata company shall cooperate with other Tata companies including
applicable joint ventures, by sharing knowledge and physical, human and
management resources, and by making efforts to resolve disputes amicably, as long
as this does not adversely affect its business interests and shareholder value.
In the procurement of products and services, a Tata company shall give

preference to other Tata companies, as long as they can provide these on
competitive terms relative to third parties.
Public representation of the company and the Group:

The Tata group honours the information requirements of the public and its
stakeholders. In all its public appearances, with respect to disclosing company and
business information to public constituencies such as the media, the financial
community, employees, shareholders, agents, franchisees, dealers, distributors and
importers, a Tata company or the Tata group shall be represented only by
specifically authorised directors and employees. It shall be the sole responsibility of
these authorised representatives to disclose information about the company or the
Group.
Third party representation:

Parties which have business dealings with the Tata group but are not
members of the Group, such as consultants, agents, sales representatives,
distributors, channel partners, contractors and suppliers, shall not be authorised to
represent a Tata company without the written permission of the Tata company, and /
or if their business conduct and ethics are known to be inconsistent with the Code.
Third parties and their employees are expected to abide by the Code in their
interaction with, and on behalf of, a Tata company. Tata companies are encouraged
to sign a non-disclosure agreement with third parties to support confidentiality of
information.
Use of the Tata brand:

The use of the Tata name and trademark shall be governed by manuals,
codes and agreements to be issued by Tata Sons. The use of the Tata brand is
defined in and regulated by the Tata Brand Equity and Business Promotion
agreement. No third party or joint venture shall use the Tata brand to further its
interests without specific authorisation.
Group policies:
A Tata company shall recommend to its board of directors the adoption of
policies and guidelines periodically formulated by Tata Sons.
Shareholders:
A Tata company shall be committed to enhancing shareholder value and
complying with all regulations and laws that govern shareholder rights.The board of
directors of a Tata company shall duly and fairly inform its shareholders about all
relevant aspects of the companys business, and disclose such information in
accordance with relevant regulations and agreements.
Ethical conduct:
Every employee of a Tata company, including full-time directors and the chief
executive, shall exhibit culturally appropriate deportment in the countries they
operate in, and deal on behalf of the company with professionalism, honesty and
integrity, while conforming to high moral and ethical standards. Such conduct shall
be fair and transparent and be perceived to be so by third parties.
Every employee of a Tata company shall preserve the human rights of every
individual and the community, and shall strive to honour commitments.
Every employee shall be responsible for the implementation of and
compliance with the Code in his / her environment. Failure to adhere to the Code
could attract severe consequences, including termination of employment.
Regulatory compliance:
Employees of a Tata company, in their business conduct, shall comply with all
applicable laws and regulations, in letter and spirit, in all the territories in which
they operate. If the ethical and professional standards of applicable laws and
regulations are below that of the Code, then the standards of the Code shall prevail.
Directors of a Tata company shall comply with applicable laws and regulations
of all the relevant regulatory and other authorities. As good governance practice
they shall safeguard the confidentiality of all information received by them by virtue
of their position.
Concurrent employment:
Consistent with applicable laws, an employee of a Tata company shall not,
without the requisite, officially written approval of the company, accept
employment or a position of responsibility (such as a consultant or a director) with
any other company, nor provide freelance services to anyone, with or without
remuneration. In the case of a full-time director or the chief executive, such
approval must be obtained from the board of directors of the company.
Conflict of interest:
An employee or director of a Tata company shall always act in the interest of
the company, and ensure that any business or personal association which he / she
may have does not involve a conflict of interest with the operations of the company
and his / her role therein. An employee, including the executive director (other than
independent director) of a Tata company, shall not accept a position of responsibility
in any other non-Tata company or not-for-profit organisation without specific
sanction.
The above shall not apply to (whether for remuneration or otherwise):
a) Nominations to the boards of Tata companies, joint ventures or associate
companies.
b) Memberships / positions of responsibility in educational / professional bodies,
wherein such association will benefit the employee / Tata company.
c) Nominations / memberships in government committees / bodies or organisations.
d) Exceptional circumstances, as determined by the competent authority.
Competent authority, in the case of all employees, shall be the chief
executive, who in turn shall report such exceptional cases to the board of directors
on a quarterly basis. In case of the chief executive and executive directors, the
Group Executive Council shall be the competent authority.
An employee or a director of a Tata company shall not engage in any
business, relationship or activity which might conflict with the interest of his / her
company or the Tata group. A conflict of interest, actual or potential, may arise
where, directly or indirectly
a) An employee of a Tata company engages in a business, relationship or activity
with anyone who is party to a transaction with his / her company.

b) An employee is in a position to derive an improper benefit, personally or to any
of his / her relatives, by making or influencing decisions relating to any transaction.
c) An independent judgement of the companys or Groups best interest cannot be
exercised.
The main areas of such actual or potential conflicts of interest shall include
the following:
a) An employee or a full-time director of a Tata company conducting business on
behalf of his / her company or being in a position to influence a decision with regard
to his / her companys business with a supplier or customer where his / her relative
is a principal officer or representative, resulting in a benefit to him / her or his / her
relative.
b) Award of benefits such as increase in salary or other remuneration, posting,
promotion or recruitment of a relative of an employee of a Tata company, where
such an individual is in a position to influence decisions with regard to such benefits.
c) The interest of the company or the Group can be compromised or defeated.
Notwithstanding such or any other instance of conflict of interest that exist
due to historical reasons, adequate and full disclosure by interested employees shall
be made to the companys management. It is also incumbent upon every employee
to make a full disclosure of any interest which the employee or the employees
immediate family, including parents, spouse and children, may have in a family
business or a company or firm that is a competitor, supplier, customer or distributor
of or has other business dealings with his / her company.
Upon a decision being taken in the matter, the employee concerned shall be
required to take necessary action, as advised, to resolve / avoid the conflict.
If an employee fails to make the required disclosure and the management of
its own accord becomes aware of an instance of conflict of interest that ought to
have been disclosed by the employee, the management shall take a serious view of
the matter and consider suitable disciplinary action against the employee.
Securities transactions and confidential information:

An employee of a Tata company and his / her immediate family shall not
derive any benefit or counsel, or assist others to derive any benefit, from access to
and possession of information about the company or Group or its clients or suppliers
that is not in the public domain and, thus, constitutes unpublished, price-sensitive
insider information.
An employee of a Tata company shall not use or proliferate information that is
not available to the investing public, and which therefore constitutes insider
information, for making or giving advice on investment decisions about the
securities of the respective Tata company, Group, client or supplier on which such
insider information has been obtained.
Such insider information might include (without limitation) the following:
Acquisition and divestiture of businesses or business units.
Financial information such as profits, earnings and dividends.
Announcement of new product introductions or developments.
Asset revaluations.
Investment decisions / plans.
Restructuring plans.
Major supply and delivery agreements.
Raising of finances.
An employee of a Tata company shall also respect and observe the

confidentiality of information pertaining to other companies, their patents,
intellectual property rights, trademarks and inventions; and strictly observe a
practice of non-disclosure.
Protecting company assets:

The assets of a Tata company shall not be misused; they shall be employed
primarily and judiciously for the purpose of conducting the business for which they
are duly authorised. These include tangible assets such as equipment and
machinery, systems, facilities, materials and resources, as well as intangible assets
such as information technology and systems, proprietary information, intellectual
property, and relationships with customers and suppliers.
Citizenship:
The involvement of a Tata employee in civic or public affairs shall be with
express approval from the chief executive of his / her company, subject to this
involvement having no adverse impact on the business affairs of the company or
the Tata group.
Integrity of data furnished:

Every employee of a Tata company shall ensure, at all times, the integrity of
data or information furnished by him / her to the company. He / she shall be entirely
responsible in ensuring that the confidentiality of all data is retained and in no
circumstance transferred to any outside person / party in the course of normal
operations without express guidelines from or, the approval of the management.
Reporting concerns:
Every employee of a Tata company shall promptly report to the management,
and / or third-party ethics helpline, when she / he becomes aware of any actual or
possible violation of the Code or an event of misconduct, act of misdemeanour or
act not in the companys interest. Such reporting shall be made available to
suppliers and partners, too.
Any Tata employee can choose to make a protected disclosure under the
whistleblower policy of the company, providing for reporting to the chairperson of
the audit committee or the board of directors or specified authority. Such a
protected disclosure shall be forwarded, when there is reasonable evidence to
conclude that a violation is possible or has taken place, with a covering letter, which
shall bear the identity of the whistleblower.
The company shall ensure protection to the whistleblower and any attempts
to intimidate him / her would be treated as a violation of the Code.
Note:
The TCoC does not provide a full, comprehensive and complete explanation of
all the rules that employees are bound to follow. Employees have a continuing
obligation to familiarise themselves with all applicable laws, company policies,
procedures and work rules.
All JVs could adopt TCoC or a joint code of conduct incorporating all elements
of the TCoC.
This version of the TCoC supersedes all earlier versions and associated
documents and stands effective from October 1, 2013.
PRODUCT PICTURES
PRODUCTS OF TATA MOTORS
INDICA V2
INDICA LX
SAFARI DICOR
TATA SUMO
TURBO
SAFARI DELUX
SUMO VICTA
CHAPTER-III
CUSTOMER SATISFACTION:
Definition of Customer Satisfaction:

Kotler (1997) defines customer satisfaction as follows:
Satisfaction is a person's feelings of pleasure or disappointment resulting

from comparing a Products perceived performance (or outcome) in relation to his or
her expectations.
Brown (1992) defines customer satisfaction as:

satisfaction.
They are: The basic elements of the product or service, basic support
services, a recovery process for counteracting bad experiences, and extraordinary
service. There are many definitions of the key elements of the services, but this one
is considered appropriate in the context of care or after sales services.
Satisfaction is a function of perceived performance and expectation. If the
performance matches the expectations the customer is satisfied. If the performance
exceeds the expectation the customer is highly satisfied and delighted. If the
performance does not match the expectations the customer is dissatisfied.
Satisfaction is a persons feelings of pleasure of disappointment resulting for
comparing a products perceived performance (out-come) in relation t his/her
expectation. The link between customer satisfaction and customer loyalty is
proportional. Suppose customer satisfaction is rated on a scale from 1 5. At a very
low levels of customer satisfaction.
Level-1, customers are likely to abandon.
Level-2 to 4, customers are fairly satisfied but still find tit easy to
switch when a better offer comes along.
Level-5, the customer is very likely to repurchase an even spread good
word of mouth about the company.
Customers are very likely to repurchase LEVEL5
Customers are fairly satisfied
LEVEL
2-4
Low level of customer satisfaction

1
LEVEL
The key to generating high customer loyalty is to deliver high customer

value. A companys value proposition is much more than its positioning on a single
attribute. Most of the successful companies are raising expectations and delivering
performances to match. These companies are aiming for TCS Total Customer
Satisfaction. Customer satisfaction is both a goal and a marketing tool. Companies
that achieve high customer satisfaction ratings make sure that their target market is
known.
After sales support management system is apart of ERP Enterprise
Resource Planning solution dealing with the support module after the sales of
product. It creates an advanced environment to the organization, which are in to
technical support after sales e.g. Companies offering electronic goods and motor
vehicles etc.
The functional features include:
Customer complaints tracking

Service engineers information tracking
Job scheduling for the complaints
Spares management
Online support
Reports
Customer complaints tracking:

Complaint is the start point of any technical support system. With out a
client request the technical support is not initiated. Complaint tracking is done as
follows:
Client may come down or make a phone call or complaint online

The client is validated. The client may have an annual maintenance
contract or may have a product in warranty or of warranty.
The intensity of the complaint is to be estimated to allocate resources.
Expected service type has to be finalized. It may be online assistance
indoor or onsite assistance.
Service Engineers information tracking:

Information about the engineers is inevitable in job scheduling.
Information about the engineers has to be added, deleted or modified in the
database. It may contain the following: the name, id of the engineer; the skill set of
the manager; the status of the engineer.
Job scheduling for the complaints:

Job scheduling means sequencing the request to its intensity,
assignment of a service engineer and creating a job card. It is done to optimize the
technical resources and to render the best service to the customer. Minor problem
are processed by technicians requests are handled by the expert team.
The job card includes the following:

The compliant id, the assigned engineer id, the data and time of
service, the spare details, no. of man hours required etc.
The spare part name and serial number

The available quantity of each spare part
The prize, warranty and other specifications
The supplier information.
Online support:
The service is done online also. The client may visit the website to
obtain basic support information about the product and FAQ. He can chat with the
service engineer on phone or online.
Report:
The report reflects the current status of the system. The reports that
can be generated are as follows:
Customer request report status of the system. The reports that can
be requests.
Service engineer report provides the information about the skills
and strengths of the support team.
Job scheduling report states the allotment of engineers to jobs.
Spares report discloses the availability of all the shapes in the
system.
Receipts and payments report gives information about the cash flow
in the system.
Bills generation.
Customer satisfaction tracking:

Customer satisfaction is the key concept to dictate the future of the
organization. In order to maximize the customer satisfaction along with quick
response and efficient service some other activities are to be performed.
They may be as follows:
Reception of the customer with hospitality.
Entertaining environment to the customer.
Providing guidance about the usage and maintenance of the product.
Offering gift and discounts.
Operationalisation of Customer Satisfaction:

As customer needs and expectations are changing all the time, this will
lead to a situation whereby customers keep setting ever higher standards,
and therefore to achieve perfection is impossible. Markets should be seen as
a group of individual companies, and each of them must be treated
individually with different requirements, experiences, commitments, and
relationships.
Implementing
customer
satisfaction
philosophy
means
identifying customers, then identifying their needs and expectations and

finally, measuring their perceptions. Knowing the needs of the customer
makes it easier to anticipate the ideal set of products and services. A major
flaw for all the companies has proved to be their inability to understand other
ways that customers can be satisfied. By implementing direct and continuous
employee contacts with the customers, the customers' requirements and
expectations
can
be
determined.
This
employee-customer
connection
additionally conveys the message that the company cares about their
customers.
Customer needs can be determined through marketing research,
customer interviews, reading customer concerns, or involving customers in
the design of services and service deliveries. In order to decide if the service
can be provided at a profit, it is necessary to link value equation to the
strategic service vision. Working together with both supplier and customer
can increase profitability by expanding margin potential.
A customer satisfaction study should begin by asking about the factors
affecting customer satisfaction, how important those factors are for the
whole, and the level of customer satisfaction. A problem with customer
satisfaction surveys (Naumann, 1994) is that a poor customer satisfaction
programme yields vague data and raises customer expectations. If customer
expectations are raised and a company's performance remains the same, the
customer's overall satisfaction will decrease.
Business Definition for: After-sales Service:
Customer support following the purchase of a product or service. In some

cases, after-sales service can be almost as important as the initial
purchase. The manufacturer, retailer, or service provider determines what
is included in any warranty (or guarantee) package. This will include the
duration of the warranty traditionally one year from the date of purchase,
but increasingly two or more years maintenance and/or replacement
policy, items included/excluded, labor costs, and speed of response. In the
case of a service provider, after-sales service might include additional
training or helpdesk availability. Of equal importance is the customer's
perception of the degree of willingness with which a supplier deals with a
question or complaint, speed of response, and action taken.
After Sales Excellence:

After Sales Excellence is a key driver for customer satisfaction and loyalty but
also a very important source of revenues and profits throughout a vehicle lifecycle. Our after
sales experts support our clients in all relevant areas of after sales service to improve the internal
cost base, the retail attractiveness as well as customer satisfaction. Our results are measurable significant improvements on key indicators such as warranty costs, service quality, and fixed first
visit rate.
Supply Chain Excellence:

Our Supply Chain Excellence service enables you to realize substantial
improvements in your supply chain performance in terms of cost, efficiency, lead times, demand
management, customer service and working capital requirements. We measure, improve and
qualify supply chain organizations and processes and support our clients by identifying and
rapidly implementing cost and efficiency savings in the entire supply chain. This can be achieved
with the comprehensive, cross-functional redesign of all logistics processes leveraging the entire
supply chain including customers and suppliers. With our proven Integrated Supply Chain
Excellence Audit we quickly identify gaps to proven best practices and benchmarks within, and
beyond, the Automotive Industry.
Value Chain Design:

Constantly reviewing the companies value chain in a rapidly evolving
environment; deriving required core competencies and partnerships is a key management
responsibility. We help our clients design their value chain in terms of a global engineering
footprint, production and service network, thereby improving efficiency and customer
satisfaction in alignment with corporate strategy.
Customer Contacts and Relationships:

In all cases, the supplier had been involved with the customer since the
beginning of the network building. It is difficult to distinguish whether some of the
changes in customer-supplier relationship were due to the duration of the
relationship between the two parties and whether some of the changes were caused
by changes in the customer's needs resulting from the customer's new position in
the network life cycle curve. For the results of this research, that question in terms
of the underlying factors has not addressed, but for future studies, it would be
relevant to clarify which of these two factors is the more significant or in fact,
whether they can be distinguished.
Relation of the Care to Customer Satisfaction:

Innis
and
La
Londe
(1994)
discovered
that
several
customer
satisfaction variables significantly affect a customer's total customer satisfaction.

Customer service attributes received high ratings for the importance of customer
satisfaction. Attributes for physical distribution of customer service were rated
higher than many marketing attributes.
Most Important Services:

Barsky (1995) proposed that what is important for one customer may
not be important for another. Barsky proposes this in the area of priority marketing,
and the idea was applied to different services in general. When a buyer considers
closer integration with a supplier, they may consider that it will most likely limit the
number of potential suppliers and fear that the partner may take advantage of this
by increasing prices or delivering poorer quality or poorer service. Interlocking with
the supplier can limit the opportunity to acquire innovations if the supplier lacks the
capability of being a leading-edge supplier. Research has shown that there are
frequently differences between the views of the supplier's management on
customer value and the customers' views on what they say they value. This was
studied in the present study as well.
CHAPTER-IV
DATA ANALYSES:
15.
A) Indica DLX
B) Indica V2
C) TATA Sumo
D) TATA Safari
E) TATA Dicor
S.No
Models
No.of
Percentag
Respondents
Indica DLX
37
37
Indica V2
37
37
TATA Sumo
13
13
TATA Safari
10
10
TATA Dicor
03
03
100
100%
Total No.of Respondents
Interpretation:
It is observed that 37% of the total respondents use Indica DLX, 37% of the
respondents use Indica V2,13% of the respondents use TATA Sumo,10% of the
respondents use TATA Safari and last 03% of respondents use TATA Dicor model.
.
16.
Which type of Car have you bought?
A) New
B) Pre Owned
S.No
Buyers
New
Pre Owned
No. of
Percentag
Respondents
94
94
100
100%
Interpretation:
From the survey conducted it is observed that 94% of the respondents
purchased new cars and 6% of the respondents purchased Pre Owned
cars.
17.
Whether the price of the Vehicle is?
A) Affordable
B) Not Affordable
S.No
Price
No. of
Percentag
Respondents
Affordable
85
85
Not Affordable
15
15
100
100%
Interpretation:
It is observed that 85% of the people feel that the price of vehicle is affordable,
and 15% of people feel that the price of vehicle is not affordable.
18.
What is the purpose of buying this Car?
A) Personal use
B) Rental use
C) Other use
S.No
Purpose of
No. of
Percentag
buying
Respondents
Personal use
87
87
Rental use
10
10
Other use
100
100%
Interpretation:
From the data collected it is observed that 87% of the customers use
their vehicle for personal use, 10% of the customers use their vehicle
use for rental and 3 % of the buyers use for other use.
19.
Who influenced in buying this Car?
A) Your self
B) Family
C) Friends
D) Advertisement
S.No
Influenced
No. of
Percentag
Respondents
Your self
48
48
Family
32
32
Friends
12
12
Advertisement
100
100%
Interpretation:
From the study it is observed that 48% is influenced by themselves,
36% feel that the family place a vital role to purchase there vehicle,
and then comes to friends 12% and then advertisement 8%.
20.
What does this car convey?
A) Status
B) Necessity
C) Comfort
D) Other
S.No
Car Conveys
No. of
Percentag
Respondents
Status
24
24
Necessity
54
54
Comfort
18
18
Other
04
04
100
100%
Interpretation:
From the data collected it is concluded that 24% of the consumers purchase the
vehicle to maintain the status, where as 54% of the consumers purchase the vehicle
because of their necessity. 18% of the consumers purchases as it gives comfort,
12% of the consumer purchase the vehicle for other reason.
21.
What are the reasons for buying this Car?
A) Price
B) Mileage
C) Service
D) Brand Image
S.No
Crucial
No. of
Percentag
Respondents
Price
34
34
Mileage
53
53
Service
Brand Image
100
100%
Interpretation:
It is concluded from the study that 34% of them say that price is crucial, 53%
of them say mileage and 7% & 6% of them say service and brand image.
22.
You use your Car mostly for?
A) Office
B) Family
C) Long drives
D) Shopping
S.No
Car used for
No. of
Percentag
Respondents
Office
44
44
Family
45
45
Long Drives
Shopping
100
100%
Interpretation:
It was observed that 44% of the respondents use there vehicle for going to
office, 45% of the respondents use there vehicle to take there family out and 2%
and 9% of the respondents use there vehicle of shopping and long drives.
23.
How long you will use this vehicle?
A) 1-2 years
B) 2-4 years
C) 4-8 years
D) 8 years & above
S.No
How long you
No. of
Percentag
will use
Respondents
1-2 years
2-4 years
15
15
4-8 years
68
68
8 years & above
12
12
100
100%
Interpretation:
From the study it is observed that 5%and 15% of the consumer keep their
vehicle 1-2 years and 2-4 years and 68% and 12% of consumers keep their vehicle
for 4-8 years and 8 years &above.
24.
Rate
your
Organization?
A) Excellent
B) Good
C) O.K
D) Poor
satisfaction
for
the
service
provided
by
the
S.No
Satisfaction level
No. of
Percentag
at service station
Respondents
Excellent
Good
61
61
O.K
24
24
Poor
100
100%
Interpretation:
From the survey conducted satisfied level at service center show at X-axis
and No.Respondents at Y-axis. 7 % of the consumers said excellent, 61% said good
and 24% and 8% of the consumers said ok and poor.
25.
Are you satisfied with mileage give by your Car?
A) yes
B) no
S.No
Satisfied with
No. of
Percentag
mileage
Respondents
Yes
81
81
NO
19
19
100
100%
Interpretation:
It is observed that 81% of the respondents are satisfied with mileage given by
there car and 19% are not satisfied with mileage given by there cars.
26.
Express your satisfaction level on performance of your Vehicle?
A) satisfied
B) O.K
C) Not satisfied
S.No
Performance of
No. of
Percentag
your vehicle
Respondents
Satisfied
80
80
O.K
20
20
Not satisfied
00
00
100
100%
Interpretation:
It was observed that 80% of customers are satisfied on the overall

performance of the vehicle and 20% of the customers are at constant (o.k).
27.
Comment on the prices charged at service station?
A) High
B) Medium
C) Reasonable
D) Low
S.No
Comment on
No. of
Percentag
prices
Respondents
High
Medium
38
38
Reasonable
56
56
Low
100
100%
Interpretation:
It was observed that 8% of the respondents feel that the prices charged at
service station was high and 38% feel it is medium and 56% of the respondents feel
that the prices are reasonable cost and 2% feel that the prices are low.
28.
How is the performance of the executives?
A) Excellent
B) Good
S.No
Performance of
No. of
Percentag
C) O.K
Executives
Respondents
D) Po
or
Excellent
Good
62
62
O.K
23
23
Poor
100
100%
Interpretation:
It is observed that 8% of the respondents feel that performance of executives
is excellent, 62% of the respondents said that performance of the executives is
good, 23% the respondents said the performance of the executives is ok and 7% of
the respondents said that performance of the executives is poor.
CHAPTER-V
FINDINGS:
SUGGESTIONS
CONCLUSION
BIBLIOGRAPHY
QUESTIONNAIRE
FINDINGS:
Most of the buyers are professionals and business people using the TATA cars.
94% of the respondents purchase new cars only.
Nearly about 85% of the customers feel that the price of vehicle
is affordable.
About 87% of the respondents use TATA cars for there personal
use.
The reason for purchase only TATA is necessity for 54% of the
customers, 24% of the consumers feels status and 18% feel
comfortable.
Many of the respondents are satisfied with regard to mileage,

price.
45% of the respondents use there vehicle to take there family

out and 44% use for going to office.
61% of the respondents were satisfied with service provided by

the dealer at the service center, 24% and 7% of the respondents
said ok and excellent, and 8% of the respondents were not

satisfied with service at service station.
Above 56% of the respondents feel the prices are reasonable at

the service center. Where 8% and 38% of the respondents feel
that the prize are high and medium respectively.
62% of the respondents feel that the overall performance of the

vehicle is good, 8% and 23% of the respondents feel that the
performance of the vehicle is excellent and o.k.
SUGGESTIONS:
It
is suggested that some more place should be provided for
luggage.
To provide better service to customers at work shop
To make the vehicle more spacious inside
To improve the comfort ness in the vehicle
Skilled and experienced persons should be provided at service
center, so that problems of the vehicle should be resolved
completely.
Engine capacity should be increase, this leads to increase mileage

and pickup once when A/C is on
To increase the place of parking at work shop.
CONCLUSION:
The global business environment is buzzing with the single most important
issue of Building a competitive edge by creating and retaining a large number of
customers than their goods and services every organization is there fore seized of
the task of establishing sustaining its worth to the customer, who has been
rendered unpredictable by competition
Therefore every business is making a continuous effort for achieving

customer effort for achieving customer loyalty
In short it is total organizational culture and brand equity, which face

challenge. So that there is a perennial struggle amongst organizations to sustain
their existence in the market place, and hence in order to sustain the stiff
competition the company has to take up market Research frequently to know the
changing needs & preference of the customers.
This helps the company to reframe the policies in providing cutting edge
technology to satisfy the customer & retain him for a life time.
BIBLIOGRAPHY
Consumer Behavior
Leon G. Shiftman
Journals
ICFAI General of Marketing
Retail Marketing
Marketing Research
G.C.Beri
Magazines
Auto India
Principles of Marketing :
Business Today
Philip Kotler & Gary

Armstrong
Services Marketing
Web Sites
Adlarian Palmer
www.autofinlimited.com
www.tatamotors.com
QUESTIONNAIRE:
PERSONAL DATA
NAME
DESIGNATION
DEPARTMENT
:
:
EXPERIENCE
f) Indica DLX
g) Indica V2
h) TATA Sumo
i) TATA Safari
2. Which type of Car have you bought
a) New
b) Pre Owned
18.Whether the price of the Vehicle is?
a) Affordable
b) Not Affordable
19.What is the purpose of buying this Car?
a) Personal use
b) Rental use
c) Other use
20.Who influenced in buying this Car?
a) Your self
b) Family
c) Friends
d) Advertisement
21.What does this car convey?
a) Status
b) Necessity
c) Comfort
d) Other
22.What are the reasons for buying this Car?
a) Price
b) Mileage
c) Service
d) Brand Image
23.You use your Car mostly for?
a) Office
b) Family
c) Long drives
d) Shopping
24.How long you will use this vehicle?
a) 1-2 years
b) 2-4 years
c) 4-8 years
d) 8 years & above
25.Rate your satisfaction for the service provided by the Organization?
a) Excellent
b) Good
c) O.K
d) Poor
26.Are you satisfied with mileage give by your Car?
a) yes
b) no
27.Express your satisfaction level on performance of your Vehicle?
a) satisfied
b) O.K
c) Not satisfied
28.Comment on the prices charged at service station?
a) High
b) Medium
c) Reasonable
d) Low
29.How is the performance of the executives?
a) Excellent
b) Good
c) O.K
d) Poor
30.Suggestions for the company?
---------------------------------------------------------------------------------------------------------------------------------------
CHAPTER-I
INTRODUCTION
INVENTORY MANAGEMENT
INTRODUCTION:
.Stock, stock, beautiful stock

Piles on the fixtures and more in the dock
Some of it ancient and some of it new
Alas, and tomorrow another lots due.
The couplet beautifully sums up the predicament of all those who are connected
with the stock (inventory). What is this inventory? What are its functions? What can
be done to minimize this inventory? These and other relevant issues have been
discussed in this chapter.
Every enterprise needs inventory for smooth running of its activities. It serves as
a link between production and distribution process. There is, generally, a time lag
between the recognition of a need and its fulfillment. The greater the time lag, the
higher requirements for inventory. It also provides a cushion for future price
fluctuations.
In a complex industry like Hero MotoCorp Ltd. it studied clearly of how the
thing are being performed and what is the real impact of these on industry and how
effectively the inventory is utilized is interested to be known by researcher because
of its great significance in the research.
MEANING AND NATURE OF INVENTORY
Inventory can be referred to as sum of the value of raw materials fuels and
lubricants, spare parts, maintenance consumables, semi processed materials and
finished goods, stock at any given point of time.
In large companies inventory place a most significant part of the current assets.
The business has about 15 to 30% of inventories in total assets.
Inventory is composed of assets that will be sold in feature in the normal course of
business operations. The assets which firms stores as inventory is anticipation of
need are raw materials, work in progress and finished goods.
MEANING OF INVENTORY MANAGEMENT

Inventory management consists of maintaining for a given financial investment an
adequate of something in order to meet and accepted pattern of demand.
Inventory considers control over costs of inventory on one hand and handle the size
of inventory on other hand.
Controlling investments in inventories constitute crucial part in current assets.
An efficient inventory controlling system will decide,
What to purchase
When to purchase
How to purchase
Size of purchase
And from where to purchase (Suppliers)
The main purpose of inventory management is to ensure
Required quantity of availability of raw materials
Minimize the investments in inventories.
INVENTORY CONTOR
Inventory control is the system devised an adopted for controlling investments in
inventory. It involves inventory planning and decision making with regard to the
quantity and time of purchase, fixation of stock levels, maintenance of stock records
and continuous stock taking.
IMPORTANCE OF THE STUDY:
Decisions Relating to Inventories are taken primarily by executives in
productions, purchasing, and marketing departments. Usually, raw material policies
are shaped by purchasing and production executives, work-in-process inventory is
influenced by the decisions of production executives, and finished goods inventory
policy is evolved by production and marketing executives. Yet, as inventory
management has important financial implications, the financial manager has the
responsibility to ensure that inventories are properly monitored and controlled. He
has to emphasize the financial point of view and initiate programmes with the
participation and involvement of others for effective management of inventories.
NEED OF THE STUDY:

Every industry on average spends 70% on raw materials (inventory).
Therefore there is a need to know the raw material cost and also there is great
importance to understand the inventory management system of this industry.
The study helps a log to various departments to take steps to control the
inventory process.
SCOPE OF STUDY:
The scope of study is limited to collecting the financial data published

in the annual reports of the company with reference to the objectives stated above
and an analysis of the data with a view to suggest favorable solutions to the various
problems related to Inventory Control Management.
This particular topic is selected to the Inventory Control Management is
recent years. The study is conducted to evaluate the performance of the company
with reference to inventory control management. The project is aimed at studying
by means of developing effective Inventory Control Management
To examine the organization structure of inventory management in the

stores of Hero MotoCorp Ltd. (Formerly Hero Honda Motors Ltd.)
(Phoenix Motors Pvt. Ltd).
To discuss pattern, levels and trends of inventories in Hero MotoCorp

Ltd.
To understand the various inventory control techniques followed by

studies in Hero MotoCorp Ltd.
To access the performance of inventory management of the Hero

MotoCorp Ltd by selected accounting ratios.
To know the inventory control techniques of Hero MotoCorp Ltd.
METHODOLOGY :
The study is based on both primary and secondary data.
PRIMART DATA:
The primary data has been collected through structured questionnaire
reflecting inventory management practices of Hero MotoCorp Ltd.
SECONDARY DATA:
The collected data is tabulated and suitable interpretation had been made by
considering the data collection through secondary data like annual reports purchase
registers, storage records of the organization.

The study has the following limitations:
The study is limited only for a period of 5 years i.e., from 2009 10 to 2013
14.
The study in the organization is 45 days only.
The limitations of ratio analysis can be applicable of the study.
There may be approximation in calculating ratios and taking the figures from
the annual reports.
CHAPTER-II
INDUSTRY PROFILE
Introduction
The automobile industry is one of Indias most vibrant and growing industries. This
industry accounts for 22 per cent of the country's manufacturing gross domestic
product (GDP). The auto sector is one of the biggest job creators, both directly and
indirectly. It is estimated that every job created in an auto company leads to three
to five indirect ancillary jobs.
2020.
Market size
The cumulative foreign direct investment (FDI) inflows into the Indian automobile
industry during the period April 2000 August 2014 was recorded at US$ 10,119.68
million, as per data by Department of Industrial Policy and Promotion (DIPP).
Data from industry body Society of Indian Automobile Manufacturers (SIAM) showed
that 137,873 passenger cars were sold in July 2014 compared to 131,257 units
during the corresponding month of 2013. Among the auto makers, Maruti Suzuki,
Hyundai Motor India and Honda Cars India emerged the top three gainers with sales
growth of 15.45 per cent, 12 per cent and 11 per cent, respectively.
The three-wheeler segment posted a 24 per cent growth to 51,461 units on the
back of increased demands from the urban market. Total sales across different
Investments
To match production with demand, many auto makers have started to invest heavily
in various segments in the industry in the last few months. Some of the major
investments and developments in the automobile sector in India are as follows:

range with a few more offerings..
Hero Cycles through its unit OPM Global has acquired a majority stake in
German bicycle company Mitteldeutsche Fahrradwerke AG (MIFA) for 15
million (US$ 19.11 million). The company plans to invest an additional 4
million (US$ 5.09 million) as capital expenses in restructuring the acquired
company.
Government Initiatives
The Government of India encourages foreign investment in the automobile sector
and allows 100 per cent FDI under the automatic route. To boost manufacturing, the
government had lowered excise duty on small cars, motorcycles, scooters and
commercial vehicles to eight per cent from 12 per cent, on sports utility vehicles to
24 per cent from 30 per cent, on mid-segment cars to 20 per cent from 24 per cent
and on large-segment cars to 24 per cent from 27 per cent.
The governments decision to resolve VAT disputes has also resulted in the top
Indian auto makers namely, Volkswagen, Bajaj Auto, Mahindra & Mahindra and Tata
Motors announcing an investment of around Rs 11,500 crore (US$ 1.87 billion) in
Maharashtra.
The
Government
of
India-appointed
SIAM
and
Automotive
Components

Road Ahead
The future of the auto industry depends on the positive sentiments and the demand
for vehicles in the market. With the festival season coming up, the Indian auto
sector will see a rise in demand which is expected to bring in major growth. An auto
dealer survey by firm UBS suggested that the Indian auto industry, riding on trends
like the upcoming festival season and decline in fuel price, will observe a 12 per
cent y-o-y growth in FY15.
Also, keeping up with international trends, there is expected to be a surge in the
number of hybrid vehicles in the Indian auto sector in the years to come.
When other segments like passenger cars and commercial vehicles logged negative
growth, the two-wheeler makers registered around 13 percent growth between
January and October. Riding on the two-wheeler sector's growth, the automotive
industry grew 9.8 percent by volume year-on-year (YoY) between January and
October.
"The two-wheeler segment is the only one that has clocked positive growth at 12.9
percent YoY (year-on-year) to reach sales of nearly 13.5 million units by October.
This can be attributed to the low cost of two wheelersin India," Vijay Kakade, vice
president for automotive and transportation practice at Frost & Sullivan, told IANS.
He said the light commercial vehicle (LCV) segment has been the worst hit, with
sales reducing to approximately 330,000 units -- an 18.9 percent YoY fall over 2013.
"The passenger car, medium and heavy commercial vehicle segments contracted
by 0.8 and 6.5 percent respectively during the period, compared to 2013. The
reduction in sales can be attributed to the slowdown and the high interest rates set
by the RBI (Reserve Bank of India) reducing the availability of finance options to the
public," Kakade added.
"The industry is looking forward to the budget for pro-business policies to reignite
the automobile industry in India."
October.
October
Auto manufacturers have been trying to cope with economical rough patch in last
two years. Trying to boost sales and implementing cost effective schemes just
sentence).
Tata Motors apart from giving customers attractive offers, gave
600 of their employees early retirement offers, last month. Ashok Leyland too
offered 500 of their employees with irresistible retirement schemes, last year (pun
intended).
Sales of Cars, SUVs, Vans, pick-ups, and entire commercial vehicle segment went
south, with passenger vehicle market encountering first decline in the decade. But
what saved the overall scenario was the two-wheeler market. It took 7.31% hike
Society of Indian Automobile Manufacturers (SIAM) expects a 6% growth over in the
fiscal 2014-15, with boost in manufacturing sector, new investment and fresh
COMPANY PROFILE
Hero MotoCorp Ltd. (Formerly Hero Honda Motors Ltd.) is the world's largest
manufacturer of two - wheelers, based in India.
In 2001, the company achieved the coveted position of being the largest twowheeler manufacturing company in India and also, the 'World No.1' two-wheeler
company in terms of unit volume sales in a calendar year. Hero MotoCorp Ltd.
continues to maintain this position till date.
Vision
The story of Hero Honda began with a simple vision - the vision of a mobile and an
empowered India, powered by its two wheelers. Hero MotoCorp Ltd., company's
new identity, reflects its commitment towards providing world class mobility
solutions with renewed focus on expanding company's footprint in the global arena.
Mission
Hero MotoCorps mission is to become a global enterprise fulfilling its customers'
needs and aspirations for mobility, setting benchmarks in technology, styling and
quality so that it converts its customers into its brand advocates. The company will
provide an engaging environment for its people to perform to their true potential. It
will continue its focus on value creation and enduring relationships with its partners
Strategy
Hero MotoCorps key strategies are to build a robust product portfolio across
categories,
explore
growth
opportunities
globally,
continuously
improve
its
operational efficiency, aggressively expand its reach to customers, continue to

invest in brand building activities and ensure customer and shareholder delight.
Manufacturing
Hero MotoCorp two wheelers are manufactured across 3 globally benchmarked
manufacturing facilities. Two of these are based at Gurgaon and Dharuhera which
are located in the state of Haryana in northern India. The third and the latest
manufacturing plant is based at Haridwar, in the hill state of Uttrakhand.
Technology
In the 1980s Hero Honda pioneered the introduction of fuel-efficient, environment
friendly four-stroke motorcycles in the country. Today, Hero Honda continues to be
technology pioneer. It became the first company to launch the Fuel Injection (FI)
technology in Indian motorcycles, with the launch of the Glamour FI in June 2006.
Distribution
The Company's growth in the two wheeler market in India is the result of an intrinsic
ability to increase reach in new geographies and growth markets. Hero MotoCorps
extensive sales and service network now spans over to 6000 customer touch points.
These comprise a mix of authorized dealerships, service & spare parts outlets and
dealer-appointed outlets across the country.
Brand
The new Hero is rising and is poised to shine on the global arena. Company's new
identity "Hero MotoCorp Ltd." is truly reflective of its vision to strengthen focus on
mobility and technology and creating global footprint. Building and promoting new
brand identity will be central to all its initiatives, utilizing every opportunity and
leveraging its strong presence across sports, entertainment and ground-level
activation
HERO'S MANDATE
Hero is a world leader because of its excellent manpower, proven management,

extensive dealer network, efficient supply chain and world-class products with
cutting edge technology from Company, Japan. The teamwork and commitment are
manifested in the highest level of customer satisfaction, and this goes a long way
towards reinforcing its leadership status
BOARD OF DIRECTORS
No.
Name of the Directors
Designation
Mr. Brijmohan Lall Munjal
Chairman & Whole-time Director
Mr. Pawan Munjal
Managing Director & C.E.O.
Mr. Toshiaki Nakagawa
Joint Managing Director
Mr. Sumihisa Fukuda
Technical Director
Mr. Sunil Kant Munjal
Mr. Suman Kant Munjal
Mr. Takashi Nagai
Mr. Yuji Shiga
Mr. Pradeep Dinodia

Director
10
Gen. (Retd.) V. P. Malik
Director
11
Mr. Analjit Singh

Director
BRIEF PROFILE OF DIRECTORS

MR. BRIJMOHAN LALL MUNJAL
Mr. Brijmohan Lall Munjal is the founder Director and Chairman of the Company
and the $ 3.2 billion Hero Group. He is the Past President of Confederation of Indian
Industry (CII), Society of Indian Automobile Manufacturers (SIAM) and was a Member
of the Board of the Country's Central Bank (Reserve Bank of India).
No Name of Company
Nature of Office
.
1
Hero Honda Motors Limited
Chairman and Whole-time Director
Hero Honda Finlease Limited
Munjal Showa Limited
Easy Bill Limited
Director
Rockman Industries Limited
Director
Shivam Autotech Limited
Director
STAKEHOLDER TIES AT THE GRASSROOTS

Hero Honda Motors takes considerable pride in its stakeholder relationships,
especially ones developed at the grassroots. The Company believes it has managed
to bring an economically and socially backward region in Dharuhera, Haryana, into
the national economic mainstream.
An Integrated Rural Development Centre has been set up on 40 acres of land along
the Delhi-Jaipur Highway. The Centre-complete with wide approach roads, clean
water, and education facilities for both adults and children-now nurtures a vibrant,
educated and healthy community.
The Foundation has adopted various villages located within vicinity of the Hero
Honda factory at Dharuhera for integrated rural development. This includes:
Installation of deep bore hand pumps to provide clean drinking water.
Constructing metalled roads and connecting these villages to the National

Highway (NH -8).
Renovating primary school buildings and providing hygienic water and toilet
facilities.
Ensuring a proper drainage system at each of these villages to prevent waterlogging.
Promoting non-conventional sources of energy by providing a 50 per cent

subsidy on biogas plants.
The Raman Munjal Vidya Mandir began with three classes (up to class II) and 55
students from nearby areas. It has now grown into a modern Senior Secondary,
CBSE affiliated co-educational school with over 1200 students and 61 teachers. The
school has a spacious playground, an ultra-modern laboratory, a well-equipped
audio visual room, an activity room, a well-stocked library and a computer centre.
The Raman Munjal Sports Complex has basketball courts, volleyball courts, and
hockey and football grounds are used by the local villagers. In the near future,
sports academies are planned for volley ball and basket ball, in collaboration with
National Sports Authority of India.
Vocational Training Centre
In order to help local rural people, especially women, Hero Honda has set up a
Vocational Training Centre. So far 26 batches comprising of nearly 625 women have
been trained in tailoring, embroidery and knitting. The Company has helped women
trained at this centre to set up a production unit to stitch uniforms for Hero Honda
employees. Interestingly, most of the women are now self-employed.
Adult Literacy Mission
This Scheme was launched on 21st September, 1999, covering the nearby villages
of Malpura, Kapriwas and Sidhrawali. The project started with a modest enrolment
of 36 adults. Hero Honda is now in the process of imparting Adult Literacy Capsules
to another 100 adults by getting village heads and other prominent villagers to
motivate illiterate adults.
Marriages of underprivileged girls
Marriages are organized from time to time, particularly for girls from backward
classes, by the Foundation by providing financial help and other support to the
families.
KEY POLICIES
AN ENVIRONMENTALLY AND SOCIALLY, AWARE COMPANY
At Hero Honda, our goal is not only to sell you a bike, but also to help you every
step of the way in making your world a better place to live in. Besides its will to
provide a high-quality service to all of its customers, Hero Honda takes a stand as a
socially responsible enterprise respectful of its environment and respectful of the
important issues.
Hero Honda has been strongly committed not only to environmental conservation
programmers but also expresses the increasingly inseparable balance between the
economic concerns and the environmental and social issues faced by a business. A
business must not grow at the expense of mankind and man's future but rather
must serve mankind.
"We must do something for the community from whose land we generate
our wealth."
A famous quote from our Worthy Chairman Mr.Brijmohan Lall Munjal.
Environment Policy
We at Hero Honda are committed to demonstrate excellence in our
environmental performance on a continual basis, as an intrinsic element of
our corporate philosophy.
To achieve this we commit ourselves to:
Integrate environmental attributes and cleaner production in all our business

processes and practices with specific consideration to substitution of
hazardous chemicals, where viable and strengthen the greening of supply
chain.
Continue product innovations to improve environmental compatibility.
Comply with all applicable environmental legislation and also controlling our
environmental discharges through the principles of "alara" (as low as
reasonably achievable).
Institutionalise resource conservation, in particular, in the areas of oil, water,

electrical energy, paints and chemicals.
Enhance environmental awareness of our employees and dealers / vendors,

while promoting their involvement in ensuring sound environmental
management.
Quality Policy
Excellence in quality is the core value of Hero Honda's philosophy.
We are committed at all levels to achieve high quality in whatever we do,
particularly in our products and services which will meet and exceed customer's
growing aspirations through:
Innovation in products, processes and services.
Continuous improvement in our total quality management systems.
Teamwork and responsibility.
Safety Policy
Hero Honda is committed to safety and health of its employees and other
persons who may be affected by its operations. We believe that the safe work
practices lead to better business performance, motivated workforce and higher
productivity.
We shall create a safety culture in the organization by:
Integrating safety and health matters in all our activities.
Ensuring compliance with all applicable legislative requirements.
Empowering employees to ensure safety in their respective work places.
Promoting safety and health awareness amongst employees, suppliers and

contractors.
Continuous improvements in safety performance through precautions besides

participation and training of employees.
INTRODUCTION ABOUT PHOENIX DEALER PROFILE (PHOENIX MOTORS)
PHOENIX MOTORS PVT LTD is dealership type of business. PHOENIX MOTORS

PVT LTD. is established on 21 st march 2003. The business is running by only
one man. The owner name is ch .madhu mathi the firm is located at habsiguda in
Hyderabad.
Generally the sale will be either on cash basis or on institutional basis.
Bank like ICICI, HDFC and CENTURION are providing loans to customers.
Advertising strategy of phoenix motors:
They are giving the ads through newspapers, wall paintings,
hoardings and field staff. They are upgrading sales by introducing the schemes,
group bookings, institutional sales and customer door-to-door activities.
Categorization of Staff members:
Staff members are categorized for technicians, 25 members are
allotted for field staff, 5 members are recruited for sales for persons, 5 persons are
placed for evaluating for spare parts, 5 members are allotted for managerial
accounts and another 3 persons for cash transaction and other members are
allotted for remaining work.
Customer relationship:
They entertain the showroom providing a customers huge
having pool game, internet facility and television with home there system. They
provide bile maintenance programs on every week.
According to other dealers PHOENIX motors in first in sales and best in service. They
treat customer, is the very important person at PHOENIX motors customer
satisfaction is their motto, why because, they will satisfied customer is the best
advertisement. They provide better value for the customers and as well as
employees also. At PHOENIX motors the customer is the boss.
SALES STRATEGY OF PHOENIX MOTORS:
Average they are selling 28 vehicles per day. PHOENIX motors PVT L.T.D
is the A.P s NO.1 dealership in sales and other activities? It is a QLAD (qualify leader
through quality dealer). At PHOENIX motor they gave the quality service to the
customers why because the cost is long forgotten but the quality is remembered
for ever. They treat quality has a...
Q
Quest for excellence
Understanding customers needs
Action to achieve customers appreciation.
Leadership determined to be a leader
involving all the people
T
Y
Team spirit to work for a common goal

Yard sticks to measure programs.
WARRANTY ON PROPRIETARY ITEMS:

Warranty on proprietary items like Tyros, Tubes and Battery etc, will be
directly handled by the respective original manufactures (OEMs) except AMCO for
batteries and Dunlop and Falcon tires and Tubes. In case of any defect in proprietary
items, other than the above two mentioned OEMS the dealers must approach the
Brach office dealer of the respective manufacture. For AMCO batteries and Dunlop
and falcon tires, tubes claims will be accepted at our authorized dealerships per the
mutually agreed terms and conditions between HERO and of these two OEMs in
case the claim is not accepted for invalid reasons. Then the claim along with the
refusal note form the OEM can be sent to the warranty section at gorgon plan after
due to recommendation of the area service engineer. If any other six services or
subsequent paid services is not availed as per the recommended schedule given in
the owners manual. If HERO recommended engine oil is not used. To normal wear &
tear components like bulbs, electric wiring, filters, spark plug, clutch plates, braded
shoes, fasteners, shim washers, oil seals, gaskets, rubber parts (other than tyre and
tube) plastic components, chain$ sprockets and in case of wheel rim misalignment
or bend.
PHOENIX motors participate and conduct social service activities. Recently

the phoenix motors organized a BLOOD DONATION CAMP for the trust on 21 st
January 2006.they motivated on the consumers to participated in this camp and
also provide certificate for the customers
THE MARKETED BIKES OF PHOENIX (All Hero Moto Corp.)
CUSTOMER RELATIONSHIP:
To entertain the customers the showroom providing a customers huge having
pool game, Internet facility and television with home theatre system. They provide
bike maintenance programs on every week. According to other dealers PHOENIX
motors in first in sales and best in service. They treat customer, is the very
important person at PHOENIX motors customer satisfaction is their motto, why
because, the well satisfied customer is the best advertisement. They provide
better value for the customers and as well as employees also. At PHONIX motors the
customer is the boss.
PHOENIX Motors participates in social service activities. The Phoenix motors
organize a BLOOD DONATION CAMP for the trust in every year. They motivated on
the customers to participated in this camp and also provide Certificate for the
customers.
CHAPTER-III
LITERATURE REVIEW
The investment in inventories constitutes the most significant part of current

assets / working capital in most of the undertakings. Thus, it is very essential to
have proper control and management of inventories.
The purpose of inventory management is to ensure availability of materials in
sufficient quantity as and when required and also to minimize investment in
inventories.
Meaning and Nature of Inventory:

In accounting language, inventory may mean the stock of finished goods only.
In a manufacturing concern, it may include raw materials, work- in progress and
stores etc.
Inventory includes the following things:

f)
Raw Material: Raw material from a major input into the organization.
They are required to carry out production activities uninterruptedly. The quantity of
raw materials required will be determined by the rate of consumption and the time
required for replenishing the supplies. The factors like the availability of raw
materials and Government regulations etc., too affect the stock of raw materials.
g)
Work in progress: The work in progress is that stage of stocks which are
in between raw materials and finished goods. The quantum of work in progress
depends upon the time taken in the manufacturing process. The quantum of work in
progress depends upon the time taken in the manufacturing process. The greater
the time taken in manufacturing, the more will be the amount of work in progress.
h)
Consumables: These are the materials which are needed to smoother

the process of production but they act as catalysts. Consumables may be classified
according to their consumption add critically. Generally, consumable stores doe not
create any supply problem and firm a small part of production cost. There can be
instances where these materials may account for much value than the raw
materials. The fuel oil may form a substantial part of cost.
i)
Finished goods: These are the goods, which are ready for the
consumers. The stock of finished goods provides a buffer between production and
market, the purpose of maintaining inventory is to ensure proper supply of goods to
customers.
j)
Spares: The stock policies of spares fifer from industry to industry. Some
industries like transport will require more spares than the other concerns. The costly
spare parts like engines, maintenance spares etc., are not discarded after use,
rather they are kept in ready position for further use.
All decisions about spares are based on the financial cost of inventory on
such spares and the costs that may arise due to their non availability.
BENEFITS OF HOLDING INVENTORIES

Although holding inventories involves blocking of a firms and the costs of
storage and handling, every business enterprise has to be maintain certain level of
inventories of facilitate un interrupted production and smooth running of business.

In the absence of inventories a firm will have to make purchases as soon as it
receives orders. It will mean loss of time and delays in execution of orders which
sometimes may cause loss of customers and business.
A firm also needs to maintain inventories to reduce ordering cost and avail
quantity discounts etc.
There are three main purpose of holding inventories.
4.
The transaction motive: This facilitates continuous production and timely

execution of sales order.
5.
The precautionary motive: Which necessitates the holding of inventories

for meeting the unpredictable changes in demand and supplies of materials
6.
The speculative motive: Which induces to keep inventories for taking

advantage of price fluctuations, saving in reordering costs and quantity
discounts
RISK AND COSTS OF HOLDING INVENTORIES
The holding of inventories involves blocking of firms funds and incurrence of
capital and other costs.

The various costs and risks involved in holding inventories are:
Capital costs: Maintaining of inventories results in blocking of the firms
financial resources. The firm has therefore to arrange for additional funds to meet
the cost of inventories.
The funds may be arranged from own resources or from outsiders. But in both
the cased, the firm incurs a cost. In the former case, there is an opportunity cost of
investment while in the later case; the firm has to pay interest to t he outsiders.
5.
Storage and Handling Costs: Holding of inventories also involves costs on

storage as well as handing of materials. The storage of costs include the
rental of the godown, insurance charges etc.
6.
Risk of Price decline: There is always a risk of reduction in the prices of

inventories by the supplies, competition or general depression in the market.
7.
Risk of Obsolescence: The inventories may become absolute due to

improved technology, changes in requirements, change in customer tastes
etc.
8.
Risk Determination in quality: The quality of materials may also

deteriorate while the inventories are kept.
Objects of Inventory Management

Definition of Inventory Management: Inventory Management is concerned
with the determination of optimum level of investment for each components of
inventory and the operation of an effective control and review of mechanism.
The main objectives of inventory management are operational and financial.
The financial objective means that inventory should not remain idle and
minimum working capital should be locked in it.
The
following
are
the
objectives
of
inventory
management:
10.
To ensure continuous supply of materials, spares and finished goods so that

production should not suffer at any time and the customers demand should
also be met.
11.
To avoid both over stocking and under stocking of inventory.
12.
To maintain investment in inventories at the optimum level as required by the

operational and sales activities.
13.
To keep material cost under control so that they contribute in reducing the
cost of production and overall costs.
14.
To eliminate duplication in ordering or replenishing stocks. This is possible

with the help of centralizing purchases.
15.
To minimize losses through deterioration, pilferages, wastages and damages.
16.
To ensure perpetual inventory control so that materials shown in stock

ledgers should be actually lying in the stores.
17.
To ensure right quality goods at reasonable prices. Suitable quality standards

will ensure proper quality of stocks. The price analysis, the cost analysis and
value analysis will ensure payment of proper prices.
18.
To facilitate furnishing of data for short term and long term planning and
control of inventory.
TOOLS AND TECHNIQUES OF INVENTORY MANAGEMENT
A proper inventory control not only helps in solving the acute problem of
liquidity but also increases profit and causes substantial reduction in the working
capital of the concern.
The
following
are
the
important
tools
and
techniques
of
inventory
management and control.

1.
Determination of stock levels:

Carrying of too much and too little of inventory is detrimental to the firm. If
the inventory level is too little, the firm will face frequent stock outs involving heavy
ordering cost and if the inventory level is too high it will be unnecessary tie up of
capital.
An efficient inventory management requires that a firm should maintain an
optimum level of inventory where inventory costs are the minimum and at the same
time there is no stock out which may result in loss or sale or shortage of production.
a)
Minimum stock level:

It represents the quantity below its stock of any item should not be allowed to
fall.
Lead time: A purchasing firm requires sometime to process the order and
time is also required by the supplying firm to execute the order.
The time in processing the order and then executing it is known as lead time.
Rate of Consumption: It is the average consumption of materials in the
factory. The rate of consumption will be decided on the basis of past experience and
production plans.
Nature of materials: The nature of material also affects the minimum level.
If a material is required only against the special orders of the customer then
minimum stock will not be required for such material.
Minimum stock level can be calculated with the help of following formula.
Minimum stock level Re ordering level (Normal consumption x Normal
re order period)
b)
Re ordering Level:
When the quantity of materials reaches at a certain figure then fresh order is
sent to get materials again. The order is sent before the materials reach minimum
stock level.
Re ordering level is fixed between minimum level maximum level.
c)
Maximum Level:
It is the quantity of materials beyond which a firm should not exceeds its
stocks. If the quantity exceeds maximum level limit then it will be over stocking.
Overstocking will mean blocking of more working capital, more space for
storing the materials, more wastage of materials and more chances of losses from
obsolescence.
Maximum stock level Reordering Level + Reorder Quantity (Maximum
Consumption x Minimum reorder period)
d)
Danger Stock Level:

It is fixed below minimum stock level. The danger stock level indicates
emergency of stock position and urgency of obtaining fresh supply at any cost.
Danger Stock level = Average rate of consumption x emergency delivery
time.
e)
Average Stock Level:

This stock level indicates the average stock held by the concern.
Average stock level = Minimum stock level + x reorder quantity.
2)
Determination of Safety Stocks:
Safety stock is a buffer to meet some unanticipated increase in usage. The

demand for materials may fluctuate and delivery of inventory may also be delayed
in such a situation the firm can be facing a problem of stock out.
In order to protect against the stock out arising out of usage fluctuations,
firms usually maintain some margin of safety stocks.
Two costs are involved in the determination of this stock that is opportunity
cost of stock outs and the carrying costs.
If a firm maintains low level of safety frequent stock outs will occur resulting
into the larger opportunity costs. On the other hand, the larger quantity of safety
stocks involves carrying costs.
3)
Economic Order Quantity (EOQ):

The quantity of material to be ordered at one time is known as economic
ordering quantity.
This quantity is fixed in such a manner as to minimize the cost of ordering
and carrying costs.
Total cost material = Acquisition Cost + Cost + Carrying Costs + Ordering
Cost.
Carrying Cost:
It is the cost of holding the materials in the store.
Ordering Cost:
It is the cost of placing orders for the purchase of materials.
EOQ can be calculated with the help of the following formula
EOQ = 2CO / I
WhereC = Consumption of the material in units during the year
O = Ordering Cost
I = Carrying Cost or Interest payment on the capital.

4)
A B C Analysis: (Always better control analysis):

Under A B C Analysis. The materials are divided into 3 categories viz., A, B
and C.
Almost 10% of the items contribute to 70% of value of consumption and this
category is called A category.
About 20% of the items contribute about 20% of value of category C covers
about 70% of items of materials which contribute only 10% of value of consumption.
5)
VED Analysis: (Vitally Essential Desire)

The VED analysis is used generally for spare parts. Spare parts classified as
Vital (V), Essential (E) and Desirable (D).

The vital spares are a must for running the concern smoothly and these must
be stored adequately. The E type of spares is also necessary but their stocks may
be kept at low figures. The stocking of D type spares may be avoided at times. If
the lead time of these spares is less, then stocking of these spares can be avoided.
6)
Inventory Turnover ratio:

Inventory turnover ratios are calculated to indicate whether inventories have
been used efficiently or not.

The inventory turnover ration also known as stock velocity is normally
calculated as sales / average inventory of cost of goods sold / average inventory.
Inventory conversion period may also be calculated to find the average time
taken for clearing the stocks. Symbolically.
Inventory Turnover Ratio
Cost of goods sold
__________________________
Average inventory at cost
(Or)
Net sales
=
________________________
(Average) Inventory
And,
Days in a year
______________________
Inventory Turnover ratio
7)
Classification and Codification of Inventories:

The inventories should first be classified can then code numbers should be
assigned for their identification. The identification of short names are useful for
inventory management not only for large concerns but also for small concerns. Lack
of proper classification may also lead to reduction in production.
Generally, materials are classified accordingly to their nature such as
construction
materials,
consumable
stocks,
spares,
lubricants
etc.
After
classification the materials are given code numbers. The coding may be done
alphabetically or numerically. The later method is generally used for coding.
The class of materials is assigned two digits and then two or three digits are
assigned to the categories of items divided into 15 groups. Two numbers will be
category of materials in that class.
The third distinction is needed for the quality of goods and decimals are used
to note this factor.
8)
Valuation of inventories Method of valuation:

FIFO method
LIFO method
Base Stock method
Weighted average price method
CRITERIA FOR JUDGING THE INVENTORY SYSTEM

While the overall objective of the inventory system is to minimize the cost to
the firm at the risk level acceptable to management, the more proximate criteria for
judging the inventory system are:
Comprehensibility
Adaptability
Timeliness
Area of improvement:
Inventory
management
in
India
can
be
improved
in
various
ways.
Improvements could be affected through.

Effective Computerization: Computers should not be used merely for accounting
purpose but also for improving decision making.
Review of Classification: ABC and FSN classification must be periodically reviewed.
Improved
Coordination:
Better
coordination
among
purchase,
production,
marketing and finance departments will be help in achieving greater efficiency in

inventory management.
Development of long term relationship:
Companies should develop long term relationship with vendors. This would
help in improving quality and delivery.
Disposal of obsolete / surplus inventories:
Procedures for disposing obsolete / surplus inventories must be simplified.
Adoption of challenging norms:
Companies should set benchmarks with global competitors and use ideals like
JIT to improve inventory management.
Inventory cost an overall view:
Introduction:
In financial parlance, inventory is defined as the sum of the value of the raw
materials, fuels and lubricants spare parts maintenance consumable semi
processed materials and finished goods stock at any giving point of time. The
operational definition of inventory would be amount of raw materials, fuel and
lubricants, spare parts and semi processed materials to be stock for the smooth
running of the plant / industry.
Need of Inventory:
Inventories are maintained basically for the operational smoothness which
they can be affected by uncoupling successive stages of production, whereas the
monetary value of the inventory serves as a guide to indicate the size of the
investment
made
to
achieve
management departments
this
operational
primary function
convenience.
is to provide
The
materials
this operational
convenience with a minimum possible investment in inventories. Materials

department is accused of both stock outs as well a large investment in inventories.
The solution lies in exercise a selective inventory control and application of
inventory control techniques. Inventories build to act as a cushion between supply
and demand. It is sufficient to take care of the requirements of demand till the next
supply arrives. It is sufficient to take care of probable delays in supply as well as
probable variations in demand.
The size of the inventory depends upon the factors such as size of industry
internal lead time for purchase, suppliers lead time, vendor relations availability of
the materials, annual consumption of the materials. Inventory coat can be
controlled by applying Modern Techniques viz., ABC analysis, SDE, ESN, HMC, VED
etc. These techniques can be used effectively with the help of computerization.
What is meant by inventory cost:

D.
The total value of stores and spares and capital spares.
E.
Stores in transit and under inspection and
F.
Stock of finished products.

Normally, there are certain problems in maintaining optimum level of
inventory. Problems of inventory can be resolved by the cost implications. Costs

which are relevant for consideration are discussed in the following lines;
Basically there are four costs for consideration in developing and inventory model.
5.
The cost of placing a replenishment order.
6.
The cost of carrying inventory.
7.
The cost of under stocking and
8.
The cost of over stocking.

The cost of ordering and inventory carrying cost are viewed as the supply
side costs and help in the determination of the quantity to be ordered for each
replenishment.
The under stocking and over stocking costs are viewed as the demand side
costs and help in the determination of the amount of variations in demand and the
delay in supplies which the inventory should withstand.
Whenever an order placed for stock replenishment, certain costs are
involved, and, for most practical purpose it can be assumed that the cost per order
is constant. The ordering cost may vary depending upon the type of items, for
example raw material like steel against production component like castings in steel
plants, support materials in the case of Steel industry.
The cost ordering includes:
6)
Paper work costs, typing and dispatching an order.
7)
Follow up costs the follow up, the telephones, telex and postal bills etc.,
8)
Costs involved in receiving of the order, inspection, checking and handling

in the stores.
9)
Any set up cost of machines charged by the supplier, either directly

indicated in quotations or assessed through quotations of various
quantities.
10)
The salaries and wages of the purchase department.
Cost of Inventory carrying:

This cost in measured as of the unit cost of the item. This measure gives
basis for estimating what is actually costs a company to carry stock.
This cost includes:
8)
Interest on capital.
9)
Insurance and tax charges.
10)
Storage costs labor costs, provision of storage area and facilities like
bins, racks etc.,
11)
Transport bills and hamali charges.
12)
Allowance for deterioration or spoilages.
13)
Salaries of stores staff.
14)
Obsolescence.
The inventory carrying cost varies and a major portion of this is

Accounted for by the interest on capital.
Under stocking cost:

This cost is the cost incurred when an item is out of stock. It includes cost of
lost production during the period of stock out and the extra cost per unit which
might have to be paid for an emergency purchase.
Over stocking cost:
This cost is the inventory carrying cost (which is calculated per year) for a
specific period of time. The time varies in different contexts it could be the lead
time of procurement of entire life time of machine. In the case of one time
purchases, over cost would be = Purchase Price Scrap Price.
INVENTORY VALUATION AND COST FLOWS:
What is the cost of inventory?

One can readily visualize the determination of inventory quantities by
physical count or by use of perpetual inventory records. When this quantity is
determined, it must be multiplied by a unity cost in order to determine the
inventory value that is used on financial statements.
Trade and quantity discount are to be excluded from unit cost since these
discount exist for the purpose of defining the true invoice cost of merchandise. Cash
discounts, on the other hand, have been considered as a reward for early payment
and as a penalty for late payment. The reward has often been interpreted as a
loss rather than as a part of unit cost. Thus it would not be difficult to find difference
of opinion as to whether invoice cost includes or excludes cash discount.
When the current replaAutomobial cost of material on hand at the close of
a year is less than the actual cost, the inventory value is reduced to
replaAutomobial cost (current market price). Thus the acceptable basis inventory
valuation is the lower of cost or market or more properly the lower of actual cost
or replaAutomobial cost.
The determination of inventory values is very important from the point of
view of the balance sheet and the income statement since costs not included in the
inventory (the balance sheet) are considered to be expensive and are thus included
in the income statement.
Valuation of inventories methods of determination:
Although the prime consideration in the valuation of inventories is cost, there
are a number of generally accepted methods of determining the cost of inventories
at the close of an accounting period. The most commonly used methods are first
in first out (FIFO) average, and last in first out (LIFO). The selection of the
method for determining cost for inventory valuation is important for it has a direct
bearing on the cost of goods sold and consequently on profit. When a method is
selected, it must be used consequently and cannot be changed for year to year in
order to secure the most favorable profit for each year.
THE FIFO METHOD (FIRST IN FIRST OUT METHOD):
Under this method it is assumed that the materials or goods first received are
the first to be issued or sold. Thus, according to this method, the inventory on a
particular date is presumed to be composed of the items which were acquired most
recently.
The value inventory would remain the same even if the perpetual inventory
system is followed.
Advantage:- The FIFO method has the following advantages.
5)
It values stock nearer to current market prices since stock is presumed to

be consisting of
6)
The most recent purchases.
7)
It is based on cost and, therefore, no unrealized profit enters into the

financial accounts of the company.
8)
The method is realistic since it takes into account the normal procedure of
utilizing or selling those materials or goods which have been longer
longest in stock.
Disadvantages:- The method suffers from the following disadvantages.

3)
It involves complicated calculations and hence increases the possibility of

clerical errors.
4)
Comparison between different jobs using the same type of material

becomes sometimes difficult. A job commenced a few minutes after
another job may have to bear an entirely different charge for materials
because the first job completely exhausted the supply of materials of the
particular lot.
The FIFO method of valuation of inventories is particularly suitable in
The following circumstances.

V.
The materials or goods are of a perishable nature.
VI.
The frequency of purchases is not large.
VII.
There are only moderate fluctuations in the prices of materials or goods

purchased.
VIII.
Materials are easily identifiable as belonging to a particular purchase lot.
The LIFO method (Last in First Out method):

This method is based on the assumption that last item of materials or goods
purchased are the first to be issued or sold. Thus, according to this method,
inventory consists of items purchased at the earliest cost.
Advantages: - This method has the following advantages:
3)
It takes into account the current market conditions while valuing materials
issued to different jobs or calculating the cost of goods sold.
4)
The method is base on cost and, therefore, no unrealized profit or loss is

made on account of use of this method.
The method is most suitable for materials which are of bulky and non
Perishable type.
Base Stock Method:
This method is based on the contention that each enterprise maintains at all
times a minimum quantity of materials or finished goods in its stock. This quantity is
termed as base stock. The base stock is always valued at this price and its carried
forward as a fixed asset. Any quantity over and above the base stock is valued in
accordance with any other appropriate method. As this method aims at matching
current costs to current sales, the LIFO method will be most suitable for valuing
stock of materials or finished goods other than the base stock. The base stock
method has advantage of charging out material / goods at actual cost. Its other
merits or demerits will depend on the method which is used for valuing materials
other than the base stock.
Weighted average price method:
This method is based on the presumption that once the materials are put into
a common bin, they lose their identity. Hence, the inventory consists of no specific
batch of goods. The inventory is thus priced on the basis of average priced on the
quantity purchased at each price.
Weighted average price method is very popular on account of its being based
on the total quantity and value of materials purchased besides reducing number of
calculations. As a matter of fact the new average price is to be calculated only when
a fresh purchase of materials is made in place of calculating it every now and then
as is the case with FIFO, LIFO methods. However, in case of this method different
prices of materials are charged from production particularly when the frequency of
purchases and issues/sales in quite large and the concern is following perpetual
inventory system.
Valuation of inventories impact on the flow of costs:
As should be quite evident, the different methods of calculating inventory
values will all have their impact on the flow of costs through the balance sheet into
the income statement. The dollars that are paid to acquire inventory are always
divided between the balance sheet (inventories) and the income statement (cost of
goods sold), there is not other place to put them. Thus if the different methods of
calculating inventory produce differing inventory values, they will also produce
differing cost of goods sold figures, and the differing cost of goods sold figures will
naturally produce differing profit figures.
In order show the impact of inventory valuation on cost flows, the preceding
exhibits are summarized. Each method produces a different figure for the transfer of
raw materials to work in process. These differences appear small, but the only
reason for this is that the dollar amounts have been kept small to make the
illustration workable.
Evaluation of methods What causes the differences?
The differences in inventory values and flows for each of the method
illustrated result from only one factor, that it, changing purchases prices or unit
costs. If purchase prices had remained stable or unchanged, each method would
have produced the same inventory value and cost flow.
Cost flows and inventory are exactly the some under stable prices. With a
falling price level, the LIFO method produces the highest cost flow and the lowest
inventory. With a falling price level, the LIFO method produces the lowest cost flow
and highest inventory. The cost flow under LIFO follows the price level, LIFO
produces larger cost flows when prices are rising and smaller cost flows when prices
are falling. A final item to consider is that the average method produces results
which fall between the extremes of LIFO and FIFO.
Evaluation of methods can we justify the differences?

The best method of inventory valuation might be specific identification, that
is, the units in inventory should be identified with the specific invoices and thus
specific unit costs to which they apply.
Fortunately, the FIFO method constitutes a very useful approximation to the
specific identification method if one can reasonably assume that the actual flow of
materials is first-in first-out. This assumption is not unreasonable and thus we have
stated the main argument for the FIFO inventory scheme, that is, the physical flow
of materials would match the flow of costs under the first in first out method.
When the units in inventory are identical, interchangeable and do not follow
any specific pattern of physical flow, the average cost system would seen to
appropriate.
The primary difference between the FIFO and average methods is centered
on the physical flow since both methods could involve identical and interchangeable
units. The FIFO method fits a first-in first-out physical flow. The average method fits
a system which has no specific pattern of physical flow. Finding a situation where
there is no specific pattern of physical flow should be quite difficult because of the
fact that most inventory items are subject to deterioration by instituting a person
would attempt to reduce such deterioration and any reasonable person would
attempt to reduce such deterioration by instituting a physical flow approximating
first-in-first-out. The major reason for the use of the average method is something
other than the lack of specific physical flow.
Ordinarily the LIFO method cannot be justified on the basis of the physical
flow of materials. Under conditions of changing prices, the advocate of LIFO says
that the only method which matches costs and revenues is the LIFO method. The
LIFO method assumes that the latest item is the first item out, and thus the current
costs of materials are matched with the other hand, assumes that the first item in is
the first item out, and thus the non-current costs of matching current costs with
current revenues is the essence of the argument for the LIFO method.
Inventories valued at standard cost:
A very useful method of valuing inventories is at a standard cost. With a
standard cost system is no need of spending a great deal of time and money tracing
unit cost through perpetual inventory record.
PERPETUAL INVENTORY CARD UNDER A STANDARD COST

SYSTEM
Perpetual inventory Plant: Standard cost:
Location: Order Quantity:.....

Order Point:
..
Date
Description
On order
Receive
d
Available
Issued
On
order
On hand
As shown above, there is need only for physical quantities since the inventory
values is the physical quantity multiplied by the standard cost. With the cost and
value columns disposed off, a perpetual inventory card can include additional data
such as quantities on order, quantities reserved, and quantities available. These

additional data are very useful for inventory and production control purpose. On the
basis of a few calculations concerning into inventories on a FIFO, a LIFO, or an
average cost basis.
Inventory of Obsolescence:
Absolvent inventories cannot be used or disposed off at values carried on the
books. Frequent reviews should be made of all inventories, and when obsolescence
is indicated a request for revaluation should be prepared for approval by
management. The difference between original and obsolete value should be
recorded by a change to operating account. Inventory obsolescence, and a credit to
inventory. If the material is scrapped, this will be for the full inventory value or used
in areas where it will be work less than its
Original value, the entry would be only for the amount of write down. Some
companies carry a solvage inventory and transfer to it materials which may be sold
or used at reduced values. Where this is done, the entry would be:
Dr. Inventory Obsolescences. Raw Material inventory or Supplies inventory.
Inventory cost in relation Hero MotoCorp Ltd shall to classifieds follows:

Inventory can be classified as capital and revenue certain items through titled
as capital in nature. Hence, due care is to be take whole drawing the material.
Materials which are to be imported from other countries have to be planned
well in advance nearly about 24 months are to initiate the proposals for
procurement.
Similarly some of the items do not require any lead time some they are
available in the local market.
Automobile is highly energy intensive industry, the inputs like power and
Steel are the major part of the variable cost since Government controls the Steel &
fuel sector, and increase is rates adversely effects the Automobile industry.
Hero MotoCorp Ltd has it own power plant and through which it saves energy
consumption. By this the cost since Government controls the Steel & fuel sector,
any increase rates adversely effects the Automobile industry.
Inventory cost of any organization also adversely affects by retaining
obsolete / scraps and inventory costs can be reduced by management with an
advance planning of procurement of materials, periodical reviews of existing spares
with reference to the fast consumption, ascertaining the information regarding the
availability of spares in other areas. Holding of extra inventory will be an additional
financial burden to the company due to payment of interest charges on the
materials purchased, diminishing value of materials purchased, diminishing value of
materials by keeping them in stores for a log time, handling charges, spare rent
etc.,
Automobile factory runs with various equipments:
i.
ii.
technical department
1.
Store
2.
Mechanical
3.
Electrical
4.
Civil
Commercial departments
1.
stores
2.
purchase
3.
accounts
To run the plant and maintain equipments departments require spares. for such
requirement of spares departments raise indents and send the indents to purchase
department through stores.
Indents:
4)
Annual indents for consumable items (stores items).
5)
Regular indents raised by consuming departments.
6)
Annual requirement of raw materials promo & QC.
Enquiries:
1)
Enquires will be sent approved sun contractors.
Order processing form:

1)
Receiving quotations from sub contractors.
2)
Enter the price details of enquiry sent in the

Order processing form.
4)
Selection of party on merit basis.
Purchase order:
1)
Prepare purchase order on selected party.
2)
Send purchase order copies to party, stores and

Departments.
Goods receipt note:

1)
Receiving goods receipt note from stores.
Purchase department:
Activity receiving indents:
Flow chart:
Receipt of annual indents for consumable items / stores items from stores
department.
Checking
of
indent
number
an
authority
of
item,
delivery
time
consumption period.
In case of any deficiency, send the information to concerned department
for clarification.
Segregation of indents for attending at C.P.D. and Hyderabad Office.
Sent the Hyderabad indents to Hyderabad Office.
Enter the indents details in indent register.
PURCHASE DEPARTMENT
PURCHASE ENQUIRY
Ms.
Sl.
Material
Departm
Quantit
No.
Code
ent
Unit
When
Required
ACTIVITY: FLOATING ENQUIRIES:

FLOW CHART:
Checking indented items and equipment name.
Taking previous suppliers information from previous supply. If new

equipment / item, information to be taken from concerned department or
from competitors / journals / yellow pages.
Prepare enquiry to approved sub contractors through enquiry format.
If emergency requirement, send the enquiries through fax / e-mail.
Enter the details of enquiries sent in order processing form.
PURCHASE DEPARTMENT
ORDER PROCESSING FORM
Sl.
Inde
No
nt
Ref
Materi
al
Descripti
Siz
Qt
Code
on
1 2 3 4 5 6
Remar
ks
No.
ACTIVITY: PREPARATION OF ORDER PROCESSING FROM

FLOW CHART:
Receiving quotation against enquiries sent.
Enter price and other of the quotation received from sub contractors in
the order processing from.
Mention the earlier purchase details of indented items against each item
in the order processing form if available.
Put up the processing from with enquiry and quotations to head

(purchase).
Examine order processing from with decide the sub contractor to whom
purchase order to be placed.
PURCHASE DEPARTMENT
PURCHASE ORDER
Sl.
Inden
Item
Descrip
No.
t No.
Code
tion
Qty
Rate
Unit
Amou
nt
ACTIVITY: PREPARATION OF PURCHASE ORDER

FLOW CHART:
Prepare purchase order after finalization of price and other technical terms
mentioning the following details.
8. Material code
9. Indent number
10.Material specification & part number
11.Quantity
12.Rate
13.Payment and other terms & conditions
Stipulation of terms of test certificate / ibr / manufactures certificate

where applicable.
Fill in and attach the purchase order review proforma to purchase order.

Send the purchase order to identified approved sub contractor.
Send the purchase order copies to store and concerned departments.
Enter the details of purchase order in purchase order register.
PURCHASE DEPARTMENT
AMENDMENT / CANCELLATION OF ORDER
Material Code
Material
Price /
Amended
Quantity as
Price /
per Order
Quantity
ACTIVITY: ORDER AMENDMENT, ORDER FOLLOW UP AND INFORM THE

SUPPLIER FOR THE REJECTIONS / DAMAGES / SHORTAGES:
FLOW CHART:
Issue of amendments in case of modification to purchase order.
Review the pending order and follow up the pending order for breakdown
requirement.
Send regular reminders to suppliers against pending purchase order every

month.
Receive shortage / excess / damages report from stores for the material
received.
Information the supplier for the rejections / damage / excess / shortage.
PURCHASE DEPARTMENT
ACTIVITY: IMPORTS:
FLOW CHART:
Receipt of indents for import items from stores department.
Taking previous / item, information to be taken from concerned

department or from competitors / journals / Yellow pages.
Send enquiry to overseas supplier.
Receiving quotations against enquiries sent.
Enter price and other terms of the quotations received from overseas
supplier in the order processing form.
8) Material code
9) Indent number
10)
Material specification & part number
11)
Quantity
12)
Rate
13)
Payment
14)
Insurance and other terms and conditions.

Send the purchase order to overseas supplier.
Send the purchase order copies to stores and concerned departments.
Prepare IC documents and submit to bank for onward transmission to

overseas supplier.
Receive shipping documents from overseas supplier and send same to

clearing agents for collection of the material.
STORES DEPARTMENT
ACTIVITY: RECEIPTS AND UNLOADING MATERIAL
Receiving of Goods through Trunk / Personnel Delivery.
Entry of vehicle at Gate Office.
Stamping on Dispatch Advise / Delivery challan by Gate Office.
Checking of challans / Dispatch Advise with purchase order.
Unloading of Goods at allotted place or in case of urgency direct at works

site.
All safety precautions are taken while unloading of material like workers
should wear safety shoes, helmets, leather head gloves, noise respirator,
nose mask.
STORES DEPARTMENT
Activity: preparation of receipt and approval book for general material / d.c. enter of
block, repair and stationary material manually in register
Sorting of Delivery challans as below:

a) General
b) Stationery
c) Repairs
d) Block
Checking with P.O. and mentioning Material Code, Party Code, Indent No.
Department Name on each & every challans.
Creation of D.C. entry in system for general materials.
Preparation of identification tags for General Materials through system.
Preparation of Receipt & Approval Book for General materials.
Manual entry of block, stationery, repairs materials.
Preparation of intimations for block, stationery, repairs materials.
STORES DEPARTMENT
ACTIVITY: PHYSICAL VERIFCATION OF GOODS:
All D.C. handed over to stores assistant physical verification like

measuring, counting and tallying with D.C.s Quantity / Description of the
materials by the Stores Assistant.
Identification tags to be attached to the verified material. Shortage /

Excess / Damages if any found to be noted on challans and inform to
section incharge.
Preparation of Shortage / Excess / Reports if any sending to parties under

copy to purchase / bills sections.
STORES DEPARTMENT
ACTIVITY: APPROVAL OF MATERIAL AND PREPARATION OF GOODS RECEIPT
NOTES:
Intimation is be sent to all the concerned departments. Showing materials

to concern person.
Taking approval of the material in receipt & approval book.
Preparation general material in receipt & approval book.
Preparation general material GRNs through system and stationery /

block / repairs GRNs manually.
STORES DEPARTMENT
ACTIVITY: REJECTED MATERIALS
Rejected materials kept in allotted area of rejected materials.
Packing of rejected materials.
Preparation of gate passes for rejected materials.
Sending back to suppliers through our Hyderabad Office.
Sending consignee copy to party vides Register Letter for booking of

Register goods to partys other than.
STORES DEPARTMENT
ACTIVITY: EXCISE GATE PASSES
Sending duplicate for transport copy of excise invoice from suppliers

delivery challans.
Mentioning A.B. Sl. No. and named of concerned department.
Duplicate for transport copy of excise invoice over to bills section for
sending the same to Excise Department.
Corresponding with supplier. If the Excise Invoice is not found with delivery
challans.
CHAPTER-IV
DATA ANALYSES AND INTERPRETATIO

The investment on raw materials over a period of 5 years from 2010 to 2014 is
presented in the following table.
1.
Investment on Raw Materials:

Year

(in crores)
2009 2010
3925.71
2010 2011
5128.75
2011 - 2012
3964.26
2012 - 2013
3623.83
2013 2014
4088.77
(in crores)
6000
5000
4000
Investment on Raw
Material
(in
crores)
3000
2000
1000
20
14
20
13
-2
01
3
20
12
20
11
-2
01
2
20
11
20
10
20
09
20
10
Interpretation:
1)
From the above table it can be understood that the inventory of was recorded
at 4088.77 during the year 2013 14 and it is decreased to 3964.26 during
the year 2012 13.
2)
It shows that there is on decrease in the inventory to the more extent of

4088.77.
3)
The average inventory of HERO MotoCorp was recorded at Rs.4088.77.
4)
The highest investment in inventory was recorded in the years 2010-11.
2.
Trend Analysis:
Trend analysis technique is applied to know the growth rate in investment of
raw material of Hero MotoCorp Ltd over the review period which is shown in the
following table.
Trend Analysis:
Year
Raw Material (in Lacks)
Trend %
2009 2010
436.40
100
2010 2011
524.93
120.286434
2011 - 2012
675.57
128.69716
2012 2013
636.76
94.2552215
2013 2014
669.55
105.149507
Trend %
140
120
100
80
60
40
20
0
20
14
20
13
20
13
20
12
-2
01
2
20
11
20
11
20
10
20
09
20
10
Trend %
Interpretation:
1)
The investment on inventory has increased in the year 2013 14. And the
lost year investment has declared continuously. The percentage in 2009 10
was 105.14 % as compared to years 2009 10 to 2013 14.
2)
The trends in inventories show that inventory have been more in the year
2011 12 and then it has shown a downward trend and again it increased to
some extent.
3)
The investment in inventories has shown fluctuating trend is initial years and
then it rose to 109.67 % and again showing fluctuating trend.
3.
Inventory Turnover Ratio:

This ratio indicates the number of times the stock has been turned over
during the period & evaluates the efficiency with which a firm is able to manage its
inventory. This ration is calculated by applying the following formula.
Cost of goods sold
Inventor turn over ration
_________________
Average inventory
Inventory turn over ration:
Year
Cost of goods
Avg.
sold
Inventory
Ratio
2009 2010
13084.39
436.40
29.9825619
2010 2011
16796.90
524.93
31.9983617
2011 - 2012
20032.81
675.57
29.6531966
2012 2013
20446.16
636.76
32.1096802
2013 2014
21727.05
669.55
32.4502277
Ratio
33
32.5
32
31.5
31
30.5
30
29.5
29
28.5
28
20
14
20
13
20
13
20
12
-2
01
2
20
11
20
11
20
10
20
09
20
10
Ratio
Interpretation:
1.
From the above table it can be observed that inventory turnover ratio is 29.98
in the year 2009-10 and it gradually increased to 32.45 during 2013 2014.
2.
In the year 2011 12 it is clear that the ratio is very less i.e., his stock
Is not turned into sales quickly.
3.
As compared to all the years the ratio is very less in 2011 12.
4.
The average inventory turn over ratio was recorded at 31.23 times during the
review period.
4.
Inventory conversion period:
It may also be of interest to see average time taken for clearing the stocks.
This can be possible by calculating inventory conversion period. This period is
calculated by dividing the number of the days by inventory turns over.
This formula may be as:
Days in a year (360 days)
_____________________
Inventory turnover ratio
Inventory conversion period: (in crores)

Year
2009
Cost of goods
Avg.
sold
inventory
13084.39
2010
2010
16796.90
2011
2011 -
20032.81
2012
2012
20446.16
2013
2013
2014
436.40
524.93
675.57
636.76
Ratio
ICP (Days)
29.9825619
12.0069793
31.9983617
11.250576
29.6531966
12.1403437
32.1096802
11.2118097
32.4502277
11.0939907
21727.1
669.55
ICP (Days)
12.4
12.2
12
11.8
11.6
11.4
11.2
11
10.8
10.6
10.4
20
14
20
13
20
13
20
12
-2
01
2
20
11
20
11
20
10
20
09
20
10
ICP (Days)
Interpretation:
From the above table it can be identified the following observations:
1)
The inventory conversion period was 11.09 days during the year, which
indicates that the stock has been very quickly converted into sales which
mean the company is managing the inventory efficiently.
2)
The lowest inventory conversion period was recorded at 11.9 days in the year
2013 14 and the highest inventory conversion was recorded at 12.14 days
in the year 2011 12.
3)
The average inventory conversion period was recorded at 10.2 days during
the review period.
5.
Percentage of Inventory over current assets:

In order to know the percentage of inventory over current assets the
Ratio of inventory to current assets is calculated and which is presented in the

Following table.
Inventory
Inventory over current assets ratio
__________ X 100
Current assets
Percentage of Inventory Over current assets:
Year
Inventory
Current
Assets
Ratio (%)
2009 2010
436.40
2890.46
15.0979429
2010 2011
524.93
1510.52
34.7516087
2011-2012
675.57
1951.69
34.6146161
2012 2013
636.76
2884.75
22.0733165
2013 2014
669.55
2911.17
22.9993439
Ratio (%)
40
35
30
25
20
15
10
5
0
20
14
20
13
20
13
20
12
20
12
20
11
-
20
11
20
10
20
09
20
10
Ratio (%)
Interpretation:
1)
From the above table it can be understand that the 22.99 % of inventory over
current assets ratio was showing a inclining trend for two years 2013 2014.
2)
However from the year 2011 12 it is showing an increasing trend.
3)
The lowest inventory over current assets ratio was recorded at 15% during
the year 2009 10 and the highest inventory over current assets ratio we
recorded at 34.75 % during 2010-2011.
4)
The average inventory over current assets ratio was recorded at 22.99 %.
14.
Percent of Inventory Over total current assets & fixed
assets:
Inventory / Current + Fixed assets
Year
Inventory
Current Assets+ Fixed

assets
Ratio (%)
2009 2010
436.40
3531.05
12.3589301
2010 2011
524.93
4447.22
11.8035537
2011 - 2012
675.57
5284.68
12.7835555
2012 2013
636.76
5308.40
11.9975882
2013 2014
669.55
5599.87
11.9565275
Ratio (%)
13
12.8
12.6
12.4
12.2
12
11.8
11.6
11.4
11.2
20
14
20
13
20
13
20
12
-2
01
2
20
11
20
11
20
10
20
09
20
10
Ratio (%)
Interpretation:
4)
From the year 2009-10 it is showing fluctuating trend but as compared

to above 2 years it is increasing.
5)
The lowest inventory over total assets ratio was recorded at 11.59%
during the year 2013-14 and the highest inventory ratio was recorded
at 12.18 % during the year average.
6)
The average inventory to total assets ration was recorded at 11.59 %

during the review period
7.
Percentage of Inventory over current liabilities:

In order to know the percentage of inventory over current liabilities the
Ration of inventory to current liabilities is calculated and which is presented in

The following table.
Inventory
Inventory over current liabilities ratio
= __________________ X 100
Current liabilities
Percentage of Inventory Over current liabilities:
Current
Year
Inventory
2009 2010
436.40
4992.04
8.74191713
2010 2011
524.93
6397.47
8.2052749
2011- 2012
675.57
4610.73
14.6521267
2012 2013
636.76
4333.25
14.6947441
2013 - 2014
669.55
4497.43
14.8873912
liabilities
Ratio (%)
Ratio (%)
16
14
12
10
8
6
4
2
0
-2
01
4
20
13
20
13
20
12
20
12
20
11
-
20
11
20
10
20
09
20
10
Ratio (%)
Interpretation:
1)
From the above table it can be understand that the % inventory over current
liabilities ratio was showing a declining trend for two years 2010-14.
2)
During the year 2010-11 the ratio was it gradually decreased to 8.20 and
there is a net increase to the extent of 12.45.
3)
The lowest inventory over total amounts ratio was recorded at 8.20 during
the year 2010-11.
4)
The highest inventory to current liabilities ratio was recorded at 14.88 during
the year 2013-14.
5)
The average inventory to current liabilities ratio was recorded at 14.88 during
the review period.
8.
Current Ratio:
In order to know the current ratio the percentage of current assets to current
liabilities is calculated and which is presented in the following table.
Current assets
Current Ratio
= _____________________
Current liabilities
Calculation of Current Ratios:

Current
Current
assets
liabilities
2009 2010
2890.46
4992.04
0.57901379
2010 2011
1510.52
6397.47
0.23611209
2011- 2012
1951.69
4610.73
0.42329306
2012 2013
2884.75
4333.25
0.66572434
2013 - 2014
2911.17
4497.43
0.64729634
Year
Ratio (%)
Ratio (%)
0.8
0.6
0.4
0.2
0
Interpretation:
-2
01
4
20
13
20
12
20
13
20
12
20
11
-
20
11
20
10
20
09
20
10
Ratio (%)
5)
From the above table it can be interpreted that the % of current assets
over current liabilities ratio i.e., current ratio was showing a fluxuation
trend from year 2010-2014.
6)
In the year 2009-2010 the ratio was 0.57 % and has increased to 0.64 %
in the year 2013-2014.
7)
The lowest current ratio was recorded at 2010-11 which is 0.23 % and the
highest current ratio was recorded at 0.57 % during the year 2009-10.
8)
The average current ratio was recorded at 0.54 % during the review
period.
9.
Quick Ratio:
The quick ratio is the relationship between quick to current liabilities quick
assets is more rigorous test of liability position of a firm it is computed by applying

the following formula.
Quick ratio =
Quick assets / Current Liabilities
Where Quick assets = Current Assets Inventory
Year
Quick assets
Current
liabilities
Ratio (%)
2009 2010
2454.06
4992.04
0.49159462
2010 2011
985.59
6397.47
0.15405934
2011- 2012
1276.12
4610.73
0.27677179
2012 2013
2247.99
4333.25
0.51877689
2013 2014
2241.62
4497.43
0.49842243
Ratio (%)
0.6
0.5
0.4
0.3
Ratio (%)
0.2
0.1
20
14
20
13
20
12
20
13
20
12
20
11
-
20
11
20
10
20
09
20
10
Interpretation:
4)
From the above table it can be understand as that the % of quick assets to
current liabilities i.e., the quick ratio was 0.49 % in 2009-10 and from that
year it is showing increasing trend.
5)
The highest quick ratio was recorded at 0.51 % during the year 2012-13
and the lowest quick ratio was recorded at 0.15 % during the year 201011.
6)
The average quick ratio was recorded at 0.49 % during the review period.

ITEM
RANK
ANNUAL
CUMULATIVE
CUMULATIVE
CONSUMPTION USAGE
PERCENTAGE
(RS/Cr)
(Cr)
OF USAGE
25983
25983
40.43
16727
42710
66.47
FINISHED GOODS
10679
53389
83.09
MATERIAL IN
4719
58108
90.43
1187
59295
92.30
3045
62340
97.02
1806
64146
99.83
108
64254
100.00
WORK IN
PROGRESS
RAW
MATERIALS
TRANSIT
INDIRECT
MATERIAL
MATERIAL WITH
FABRICATION
TRANSFER IN
TRANSIT
SCRAP ARISE &
OTHERS

Actual Value of A = 42710/64254*100 = 66.47%
B = 23.96% & C = 9.57%
RANKS
% CHANGE
97.0299.83 100
83.0990.4392.3
66.47
40.43
SI
T
TR
AN
O
TH
ER
S
FI
N
IS
H
ED
FA
BR
IC
AT
IO
N
M
AT
ER
IA
L
TR
AN
SI
T
G
O
O
D
S
RA
W
W
O
RK
IN
AB
C ANALYSES FOR 2009-10
INTERPRETATION


ITEM
RANK
ANNUAL
CUMULATIVE
CUMULATIVE
CONSUMPTION USAGE
PERCENTAGE
(RS/Cr)
(Cr)
OF USAGE
29148
29148
38.61
19656
48804
64.65
FINISHED GOODS
13017
61821
81.89
MATERIAL IN
5038
66859
88.56
1286
68145
90.27
4963
73108
96.84
2107
75215
99.63
WORK IN
PROGRESS
RAW
MATERIALS
TRANSIT
INDIRECT
MATERIAL
MATERIAL WITH
FABRICATION
TRANSFER IN
TRANSIT
SCRAP ARISE &
278
75493
100.00
OTHERS

Actual Value of A = 61821/75493*100 = 81.89%
B = 8.38%
C = 9.73%
RANKS
81.89
88.56 90.27
% CHANGE
96.84 99.63 100
64.65
38.61
O
TH
ER
S
SI
T
TR
AN
FA
BR
IC
AT
IO
N
SI
T
8
M
AT
ER
IA
L
IS
H
ED
G
O
O
D
S
TR
AN
3
RA
W
FI
N
W
O
RK
IN
ABC
ANALYSES FOR 2010-11
INTERPRETATION

ITEM
RANK
ANNUAL
CUMULATIVE
CUMULATIVE
CONSUMPTION USAGE
PERCENTAGE
(RS/Cr)
(Cr)
OF USAGE
33123
33123
40.65
21772
54895
67.38
FINISHED GOODS
4190
59085
72.52
MATERIAL IN
9198
68283
83.81
1546
69829
85.70
7968
77797
95.48
3379
81176
99.63
300
81476
100.00
WORK IN
PROGRESS
RAW
MATERIALS
TRANSIT
INDIRECT
MATERIAL
MATERIAL WITH
FABRICATION
TRANSFER IN
TRANSIT
SCRAP ARISE &
OTHERS

Actual Value of A = 59085/81476*100 = 72.52%
B = 22.96%
C = 4.52%

RANKS
67.38 72.52
83.81 85.7
% CHANGE
95.48 99.63 100
40.65
O
TH
ER
S
SI
T
TR
AN
SI
T
8
FA
BR
IC
AT
IO
N
M
AT
ER
IA
L
IS
H
ED
G
O
O
D
S
TR
AN
3
RA
W
FI
N
W
O
RK
IN
INTERPRETATION
material in transit comes under class B category, and lastly Class C occupies 4.51 % with

ITEM
WORK IN
RANK
ANNUAL
CUMULATIVE
CUMULATIVE
CONSUMPTION USAGE
PERCENTAGE
(RS/LAKHS)
(RS)
OF USAGE
25814
25814
35.46
11646
42458
58.33
15320
57778
79.37
10262
68040
93.47
1317
69357
95.28
1279
70654
97.06
PROGRESS
RAW
MATERIALS
FINISHED
GOODS
MATERIAL
IN TRANSIT
INDIRECT
MATERIAL
MATERIAL
WITH
FABRICATION
TRANSFER IN 7
2029
72683
99.85
111
72794
100.00
TRANSIT
SCRAPS ARIS 8
& OTHERS
A Occupies 70% annual consumption value i.e., 70% of 72794 = 50955.8

A + B Occupies 90% annual consumption value i.e., 90% of 72794 = 65514.6
Actual Value of A = 57778/72794*100
= 79.37%
B = 14.10%
C = 6.53%
ABC Analysis 2012-2013
100
90
80
70
60
50
40
RANKS
30
% CHANGE
20
10
O
TH
ER
S
SI
T
&
TR
AN
M
AT
ER
IA
L
IN
D
IR
EC
T
M
AT
ER
IA
L
FA
BR
IC
AT
IO
N
IS
H
ED
FI
N
RA
W
W
O
RK
IN
INTERPRETATION
A category and Class B occupies 14.10 after the class A percentage therefore item
items indirect material, material with fabrication, transfer in transit, scraps and others
ABC ANALYSIS FOR THE YEAR 2013-14

ITEM
RANK
WORK IN
ANNUAL
CONSUMPTIONUSAGE
PERCENTAGE
(RS/LAKHS)
OF USAGE
FINISHED GOODS
669.55
MATERIAL IN
15560
TRANSIT
5
OTHERS
47.67052
19844.12
49.33511
35404.12
88.01933
36628.12
91.06235
38195.12
94.95812
40135.12
99.78122
40223.12
100
1940
TRANSIT
SCRAP ARISE &
19174.57
1567
FABRICATION
TRANSFER IN
2.123431
1224
MATERIAL
MATERIAL WITH
854.11
18320.46
MATERIALS
INDIRECT
(RS)
854.11
PROGRESS
RAW
CUMULATIVE CUMULATIVE
88
A Occupies 70% of annual consumption value i.e., 70% of 40223.12 is 28156.18

A + B Occupies 90% of annual consumption value i.e., 90% of 40223.12 is 36200.80
Actual Value of A = 28156.18/40223.12*100 = 69.99%
B = 24.42%
C = 5.59%
45000
40000
35000
30000
25000
RANK
ANNUAL CONSUMPTION
(RS/LAKHS)
20000
CUMULATIVE USAGE (RS)

15000
CUMULATIVE PERCENTAGE
OF USAGE
10000
5000
SI
T
TR
AN
M
AT
ER
IA
L
G
O
O
D
S
IS
H
ED
FI
N
W
O
RK
IN
INTERPRETATION
Now we conclude that Class A occupies 69.99% of total values of them, therefore
items work in progress, raw materials and finished goods are comes underclass A category
and Class B occupies 24.56%after the class A percentage therefore item material in
transit comes under class B category, and lastly Class C occupies 5.58% with items
indirect material, material with fabrication, transfer in transit, scraps and others.
CHAPTER-V
FINDINGS
SUGGESSIONS
CONCLUSIONS
BIBLIOGRAPHY
FINDINGS
Over all the inventory of Hero MotoCorp Ltd is up to the mark.
The production during 2013-14 was 21727.05 and 20446.16 respectively

which is higher as compared to 2012-2013 which is 23586.80 and
25252.98.
Investment on raw material in 2011-2012 is 3623.83 Cr which very high as

compared to 2012-13 which is only 3964.26 Cr.
The inventory turn over ratio shows that the stock has been converted
into sales is only 1.01 times.
In the year 2009-10 the stock was cleared within 11.02 days whereas it
took 12.73 days in the year 2012-2013 which took more days for clearing
stock.
Year 2013-14 is not showing sample profits. This is because of Iron prices
have been continuously under pressure due to persistent mismatch
between supply and demand.
.
SUGGESTIONS
Though the production is higher is the year 2009-2010 and the sales were
very high i.e., as per inventory conversion period it took 11.01 days. This
shows that there is demand for Automobile and the funds unnecessarily tied
up. So, proper demand forecasting should be done and according to that it
may be manufactured.
The investment on raw material should be made as per the requirement.

Unnecessary investment may block up the funds.
Neither too high nor too low inventory turnover ratios may reduce profit and
liquidity position of the industry. So, proper balance should be made to
increase profits and to ensure liquidity.
The raw material should be acquired from the right source at right quality and
at right cost.
CONCLUSION
Today business scenario inventory management is becoming very

crucial part of the organization.
The system of inventory management in Hero MotoCorp Ltd very

effective. The organization is basically and assembling unit and thus
inventory place a most significant role in the decision making process.
From the various calculations and figures relating to inventory

management it is clear that the inventory classification of A items are
maintain for days, as a result it reduce investment in raw material,
reducing the lead time and also the large quantity discount because
the stock are kept for days.
In the classification of ABC items procedure is following in Hero

MotoCorp Ltd has launched the different type of card system for class
C items.
Class A & B items are consider under the just in time philosophy as the
procurement time has been reduced up to greater extent by the proper
co-ordination of buyer and supplier.
There is great improvement in the inventory turnover ratio from 3

years. It is increased from 5.98 to 7.24% this position indicates that
the stocks are fast moving and get converted into sales quickly in
Hero MotoCorp Ltd,
Finally we conclude that Hero MotoCorp Ltd the inventory system is

very good with high techniques.
BIBLIOGRAPHY
1.
By I.M Pandey
2.
By Prasanna Chandra
3.
Total Quality Management
By K. Shridhara Bai
4.
Management Accounting
R.K.Sharma &S.KGuptha
WEBSITES:
www.google.com
www.heromoto.com
www.indiancompanys.com
www.automobilsindia.com
Table Content
Chapte
r
Title
Page No
1-5
Introduction
Objectives Of The Study
I
Need Of The Study

Methodology Of The Study
Limitations Of The Study
II
Review Of Literature
6-27
Research Studies
Stock Markets
III
Company Profile
28-36
IV
Data Analysis And Interpretation
37-44
Findings
45-46
VI
Suggestions
47-48
VII
Conclusions
49-50
VIII
Bibliography
51-52
CHAPTER-I
INTRODUCTION
Introduction
Objective of the study
Need and scope of the study
Methodology of the study
Limitations
INTRODUCTION
Stock Market integration is generally perceived as a real barometer for the economic growth.
This integration is because of globalization and liberalization. With financial integration,
emerging economies have become increasing attractive place for the portfolio investors who
generally seek marginal amount of return than what available in other developed countries. There
are several benefits associated with financial integration such as real price discovery, market
efficiency, higher savings and investments, low transaction costs and that would lead to overall
economic development.
The correlation between the returns for different markets is the core indicator to measure the
influence of portfolio risk Markowitz (1952). According to the portfolio theory, assets with low
correlation between their returns significantly enhance the risk-adjusted return of the portfolio.
Thus diversifying the investments in the emerging market will give scope to reduce unsystematic
risk or to improve the marginal returns. If all markets are highly correlated then the crash in one
market will ripple to other markets too. In January 2008, national stock markets declined sharply
due to credit market developments in the United States.
India has the distinction of having the second largest number of listed companies after the USA.
Number of firms in emerging markets now cross-list on international exchanges to get benefit of
lower cost of capital and more liquidity-traded shares. There are some debates whether stock
market integration brought economic development or will cause economic disruptions. This issue
had been extensively studied nearly four decades ago by Shaw (1973) and McKinnon (1973), wh
oresulted in significant evidence that financial development
promotes economic growth, mainly through a raise in the level of saving and investment. The
returns of domestic and foreign markets are less than perfectly correlated. This indicates higher
the correlation, higher chances of co-movement and vice versa. The modern portfolio theory
elicits the integration and interdependence which focuses the issue of diversifying assets. The
advantages of assetdiversification have extensively discussed in the literature
[see Grubel (1968), Lessard (1973),Agmon and Lessard (1977), Solnik
(1991)].
There have been numerous reasons forwarded for rapid growth in some of the selected countries.
Firstly, Governments in less developed and emerging countries have become more liberal in
adopting market-oriented reforms geared to privatize previously public enterprises such as
transport and communications and public utilities; secondly financial sectors in these countries
have been opened to foreign private sector investment; thirdly, the corporate sectors are
now becoming increasingly competitive in these countries, even on an international level; state
owned enterprises continue to become more privatized, paving the way for shares being
distributed amongst a wider span of the population. The objective of this paper is to study comovement of Indian stock markets index with developed as well as developing countries stock
market indices.
In investigating these issues, we take Nifty index as the core barometer of the Indian
stock market as it captures the major chunk of Indian stock market. On the other hand, the other
stock markets are selected based on Indias significant trade and financial relations with foreign
countries. We have selected stock markets of India, China, U.S, U.K, Hong Kong, Japan,
Germany, and Australia as a developed market.
SELECTED STOCK MARKETS AND THEIR INDEX:
COUNTRY
STOCK MARKET
INDICES
ABBREVIATI
ON
INDIA
National Stock Exchange
NIFTY
NIFTY
CHINA
Shanghai composite Index
SCI
SCI
U.S
NASDAQ
NASDAQ
U.K
Financial Time Stock Exchange
FTSE
FTSE
GERMANY
Deutrcher Aktien Index
DAX
DAX
FRANCE
CAC
CAC
JAPAN
Tokyo Stock Exchange
NIKKIE
NIKKIE
HONG KONG
Hong Kong Stock Index
Hangseng
HANGSENG
NEED FOR THE STUDY:

Presently, the fluctuations in the Indian market are attributed heavily to cross border capital
flows in the form of FDI, FII and to reaction of Indian market to global market cues. In this
context, understanding the relationship and influence of various exchanges on each other is very
important. This study compares global exchanges which are from different geo- politico-socioeconomic areas. With the cross border movements of capital like never before in the form of FDI
and FII, coupled with the easing of restrictions bringing various stock exchanges at par in terms
of system and regulations, it can be assumed reasonably that a particular stock exchange will
have some impact on other exchanges.
6. To know the relationship between the global markets with Indian market.
7. To find which global markets mostly influence the Indian market.
8. To find the relationship between MSCI and Indian Stock Market(NSE and BSE)
9. To find the risk of an Index stock i.e., ONGC with Nifty and Sensex.
10. To find the volatility of Nifty and Sensex at budget session time between 11am to
12:40pm.
METHODOLOGY:
The study is based on the data collected from eight global markets.
The secondary data is collected from NSE website, BSE website, SEBI website, chittorgarh
website, karvy website Angel Broking website, Books, Newspaper Journals and etc.
Statistical tools: Beta, Correlation, standard deviation
LIMITATIONS:
8. Duration is very short

9. No primary data
10. Extracted data from NSE and BSE website, which is secondary.
11. As a student I dont have investment experience
12. Dependability
13. Very few indices have been taken for the whole study
14. Detailed study of the topic was not possible due to limited size of the project.
CHAPTER II
REVIEW OF LITERATURE:
Research studies
Global integration
Concept of stock exchange
National stock exchange
Global market movement
There is a numerous empirical research studies conducted in field of financial co-integration of

Indian stock markets with other countries stock markets during different time period by
employing different co-integration techniques.
Sharma and Kennedy (1977) examined the price behaviour of Indian market with the US and
UK markets and found that the behaviour of the Indian market is statistically indistinguishable
from that of the US and UK markets and found no evidence of systematic cyclical component
or periodicity found for these markets.
Taylor and Tonks (1989) were the first to apply bivariate co-integration in the UK and U.S
markets to test the importance of the latter after the abolition of foreign exchange controls in
1979. Using cointegration techniques, they found no significant increase in the correlation of
short-run stock market returns for the UK and certain overseas markets post 1979; their findings
also implied the inefficiency of a number of stock markets.
Rao and Naik (1990) applied the Cross-Spectral analysis and found the Indian stock index, the
gains estimates from either the US or the Japan indices are not dependent and hence they
concluded the relationship of Indian market with international markets is poor reflecting the
institutional fact that the Indian economy has been characterized by heavy controls throughout
the entire seventies with liberalization measures initiated only in the late eighties.
Cheung and Mak (1992) studied weekly return series of the AsianPacific emerging markets for
the period 1977 to 1988 and concluded that The US market can be considered as a 'global factor'
and is found to lead most of the Asian Pacific emerging markets except Korea, Taiwan and
Thailand. The Japanese market is found to have a less important influence on the Asian Pacific
emerging markets.
Kasa (1992) suggested that the short-term return correlation between stock markets is not
appropriate from the perspective of long-horizon investors driven by
common stochastic trends. A cointegration model is useful since it not only distinguishes
between the nature of long-run and of short-run linkages among financial markets, but captures
the interaction between them as well.
Hassan and Naka (1996) investigates the dynamic linkages among the U.S., Japan, U.K. and
German stock market and found significant evidence in support of both short-run and long-run
relationships among these four stock market indices. They suggested that in co-integrated
markets, price movements in one market immediately influence other markets, consistent with
efficient information sharing and free access to markets by domestic and foreign investors.
Elyasiani (1998) have investigated the interdependence and dynamic linkages between the
emerging capital markets of Sri Lanka with the markets of its major trading partners and have
found no significant interdependence between the SriLankan market and the equity market of the
US and other Asian countries.
Darrat and Zhong (2002) examined the linkages between eleven emerging Asia-Pacific markets
with US and Japan. They argued that the effect of the movements in the Japan market on the
Asia-Pacific region is only transitory.
Golaka C Nath&Sunil Verma (2003) examined the interdependence of the three major stock
markets in South Asia. Using daily stock market data from January 1994 to November 2002,
they examine the stock market indices of India (NSE-Nifty), Singapore (STI) and Taiwan
(Taiex). On employing bivariate and multivariate co-integration analysis to model the
linkages among the stock markets, no co-integration was found for the entire period. Hence, they
conclude that there is no long run equilibrium.
The results of Johnson (2003) revealed that the high share of trade with the US shows positive
effect, while the increased bilateral exchange rate volatility shows reverse effect on the stock
market co movements.
Flood and Rose (2003), describe a simple methodology to test for asset integration and apply it
within and between American stock markets. The techniques based on a general inter-temporal
asset-pricing model and rely on estimating and comparing expected risk free rates across assets.
Expected risk free rates are allowed to vary freely over time, constrained only by the fact that
they are equal across assets. The methodology used here takes into the fact that asset markets are
integrated when assets are priced by the same stochastic discount rate. This model has been
applied to stocks drawn from the S&P 500 and the NASDAQ, and the conclusions are that the
NASDAQ is usually integrated, the S&P always seems to be integrated and the S&P and the
NASDAQ do not seem to be closely integrated.
Guha, Oak,Bhupal and Daga (2004) have conducted research on the interdependence among
the major stock markets of the world. Using the monthly data from January 1993 to September
2003, They examined the stock market indices of India (SENSEX), Hong Kong (Hang Seng), the
USA(DJIA) and the UK (FTSE-100). Co-integration technique has been employed to study the
long-term linkages among the markets. They found that the equity markets of India and Hong
Kong are co-integrated with the other markets whereas the markets of the USA and UK are not.
Narayan
et al.
(2004) examines
the dynamic
linkages between
the stock
markets of
Bangladesh, India, Pakistan and Sri Lanka using Granger causality approach. In the short run
there is unidirectional Granger causality running from stock prices in Pakistan to India, stock
prices in Sri Lanka to India and from stock prices in Pakistan to Sri Lanka. Bangladesh is the
most exogenous of the four markets.
Mukharjee and Mishra (2005) applied the Engel-Granger (Engeland Granger1987) test of
causality and co integration and Geweke measure of feedback to empirically investigate the
hypothesis that the Indian stock market is not co integrated with other national markets in the
long run and there is no cause and effect relationship among those markets .The grangers
causality test and unidirectional Geweke feedback statics proved the fact that though Indian
equity market have some influence on the stock market of some of the Asian countries , the
equity market of European and American countries are not at all influenced /caused by India.
Colthup (2005) have found that bilateral trade, inflation rate differential, industrial production
growth differential, interest rate differential, stock market size and volatility, region etc. are some
of the important factors that can affect the spill over of information among the markets. In the
paper by A.S. Lamba (2005), he examined the influence of developed equity markets on Indian
markets and what influence can the Indian equity market exert on the others To examine these
dynamic relationships, a multivariate co- integration framework is used with error correction
models estimated to analyse the casual influence of the major developed markets on south Asian
markets. This method allows separation of any long run equilibrium relationships between the
markets from the short run casual effects.
Won, Agrawaland Du (2005) have investigated the long-run equilibrium relationship and shortrun dynamic linkage between the Indian stock market and the stock markets in major developed
countries (United States, United Kingdom and Japan) after 1990 by examining the Granger
causality relationship and the pair wise, multiple and fractional co integrations between the
Indian stock market and the stock markets from these three developed markets. They conclude
that Indian stock market is integrated with mature markets and sensitive to the dynamics in these
markets in a long run. In a short run, both US and Japan Granger causes the Indian stock market
but not vice versa. In addition, they find that the Indian stock index and the mature stock indices
form fractionally co integrated relationship in the long run with a common fractional, no
stationary component and find that the Johansen method is the best reveal their co-integration
relationship.
Bose and Mukharjee (2006) examined the co movement of the Indian stock market with
developed markets like US, Japan and other Asian markets with using tools like pair wise and
group wise co integration and granger-causality test .They found that on a daily bases the Indian
index is most highly correlated with the Singapore STI index, and it is also very highly
correlated with the stock indices of Malaysia, South Korea, Taiwan and Thailand , while the least
correlation is observed with the US S&P 500 index. Stock return in India are seen to be highly
correlated with returns in major markets like Hong Kong, Singapore, and Korea and also with
Thailand and Taiwan , while lowest correlations are observed.
Lamba (2005) conducted research on short run and long run relationship between India,
Pakistan and Sri Lanka and major developed market during July 1997 - December 2003. Using a
multivariate co integration framework and vector error-correction modeling, they found that the
Indian
market
is
influenced by the US, UK and Japan and South Asian equity markets are becoming more integ
rated witheach other but at a relatively slow pace.
Ashwin et al. (2008) has studied the long term and short term co-movement among the
developed market and emerging market with the help of co-integration technique. They had
studied the co-movements of the BSE, BVSP, MXX, HANGSENG, RTS, FTSE100, DJIA
and NASDAQ stock markets by using daily returns data for the July 1, 1997 to June 30, 2008
period. They found that the correlation of BSE with BVSP, MXX, FTSE100, DJIA and
NASDAQ is low.
Raj et al. (2009) has studied how the Indian stock market is integrated with other global markets
of the US, the UK and Japan and other major regional markets in Asia such as Singapore and
Hong Kong by VECM model and found that the integration of the Indian stock markets with
global markets such as the US and UK is much higher than with the regional markets.
Chittedi, Krishna Reddy (2009) empirically investigates the long run equilibrium relationship
between the BRIC(Brazil, Russia, India and China) stock markets and the stock market indices
of three major developed countries as a using the multivariate co integration. The multivariate co
integration technique is used to investigate the long run relationship. To assess the short run
influence of one market on the other and to assess how many days each market takes to factor
out the influence Indian stock market, they have used the Granger causality test with 02 days.
The study found that US, and Japan market factors influencing Indian stock market. It might be
because of maximum international trade commercial activities between these countries. Indian
stock market is not influencing by UK, Brazil, Russia and China markets. But Brazil and Russia
markets are influencing by Indian stock market. The study finally conclude that India and
developed countries markets USA, UK, Japan, and other Emerging BRIC markets highly co
integrating during the period of the study.
THEORITICAL FRAMEWORK
Global integrationthe widening and intensifying of linksbetween high-income and
developing countries has accelerated over the years. Over the past few years, the financial
markets have become increasingly global. The Indian market has gained (FIIs). Following the
implementation of reforms in the securities industry in the past few years, Indian stock world
ranking as per Standard and Poors Fact Book 2012,India ranked 11th in terms of market
capitalization, 17th in terms of total value traded in stock exchanges, and 30th in terms of turn
over ratio, as of December 2011.
The turnover of all the markets taken together has increased from US$65 trillion in 2010 to
US$66.4 trillion in 2011. Significantly, the US alone accounted for about 46.3 percent to the
world wide turn over in 2011. Despite having a large number of companies listed on its
exchanges, India accounted for a meager 1.1 percent to the total world turn over in 2011. A scan
be observed from Table1-4, the market capitalization of all the listed companies taken together
across all the markets stood at US$45.08 trillion in 2011(US$54.51trillionin2010). The share of
the US in world wide market capitalization increased from 31.4 percent at the end of 2010 to
34.7 percent at the end of 2011, ,while the Indian listed companies accounted for 2.3 percent of
the total market capitalization at the end of 2011.The stock market capitalization for some
developed and emerging countries is shown in Chart 1-3
Table1-4:International Comparison of Global Stock Markets:
InternationalComparis Market Capitalisation(US$mn)

on
MarketCapitalisationRatio
(inpercent)
No.oflistedCompanies
Markets
2009
2010
2011
2009
2009
2010
2011
DevelopedMarket
33,531,413
39,309,690
33,169,049
24,635
27,024
27,497
Australia
1,258,456
1,454,547
1,198,164
136.07
157.28
87.34
1,882
1,913
1,922
France
1,972,040
1,926,488
1,568,730
74.43
72.71
56.57
941
901
893
Germany
1,297,568
1,429,707
1,184,459
38.77
42.72
33.17
601
571
670
Japan
3,377,892
4,099,591
3,540,685
66.66
80.90
60.35
3,208
3,553
3,961
Korea
836,462
1,089,217
994,302
100.47
130.83
89.08
1,778
1,781
1,792
Singapore
310,766
370,091
308,320
170.53
203.09
128.63
459
461
462
UK
2,796,444
3,107,038
1,202,031
128.60
142.88
49.43
2,179
2,056
2,001
USA
15,077,286
17,138,978
15,640,707
105.76
120.22
103.62
4,401
4,279
4,171
EmergingMarkets
13,848,456
15,201,722
11,913,772
24,073
21,675
22,056
China
5,007,646
4,762,837
3,389,098
100.46
95.55
68.42
1,700
2,063
2,342
India
1,179,235
1,615,860
1,015,370
90.01
123.33
63.81
4,955
4,987
5,112
Russia
861,424
1,004,525
796,376
69.99
81.62
46.37
279
345
327
Brazil
1,167,335
1,545,566
1,228,969
74.26
98.32
47.13
377
373
366
Indonesia
178,191
360,388
390,107
32.98
66.70
21.04
398
420
440
Malaysia
255,952
410,534
395,083
133.59
214.27
91.85
960
957
941
Mexico
340,565
454,345
408,691
38.93
51.93
29.48
125
130
128
WorldTotal
47,379,869
54,511,412
45,082,821
--
--
--
48,732
48,782
49,553
2010
2011
USAaspercentofWorld 31.8
31.4
34.7
--
--
--
9.03
8.77
8.42
IndiaaspercentofWorld 2.5
3.0
2.3
--
--
--
10.17
10.22
10.32
Note: Listed companies in India pertain to BSE.

Market Capitalization ratio is computed as a percentage of GDP.
Koreahasbeenclassifiedasdevelopedmarketsfrom2010onwards.
Source: S&P Global Stock Market Factbook,2012 and World Development Indicators,
World Bank
Source: S&P Global Stock Market Factbook,2012 and World Development

Indicators, World Bank
CONCEPT OF STOCK EXCHANGE

The Securities Contracts (Regulation) Act, 1956, has defined Stock Exchange as an "association,
organization or body of individuals, whether incorporated or not, established for the purpose of
assisting, regulating and controlling business of buying, selling and dealing in Securities".
Stock exchange as an organized security market provides marketability and price continuity for
shares and helps in a fair evaluation of securities in terms of their intrinsic worth. Thus it helps
orderly flow and distribution of savings between different types of investments. This institution
performs an important part in the economic life of a country, acting as a free market for securities
where prices are determined by the forces of supply and demand. Apart from the above basic
function it also assists in mobilizing funds for the Government and the Industry and to supply a
channel for the investment of savings in the performance of its functions.
The Stock Exchanges in India as elsewhere have a vital role to play in the development of the
country in general and industrial growth of companies in the private sector in particular and
helps the Government to raise internal resources for the implementation of various development
programmes in the public sector. As a segment of the capital market it performs an important
function in mobilizing and channelising resources which remain otherwise scattered. Thus the
Stock Exchanges tap the new resources and stimulate a broad based investment in the capital
structure of industries.
A well developed and healthy stock exchange can be and should be an important institution in
building up a property base along with a socialist in India with broader distribution of wealth and
income. Thus Stock Exchange is a vital organ in a modern society. Without a stock exchange a
modern democratic economy cannot exist. The system of joint stock companies financed through
the public investment as emerged has put the vast means of finances almost to entrepreneurs'
needs.
Finance from external sources mainly from the investing public can become possible only
when an institute like Stock Exchange provides opportunities for the conversion of scattered
savings into profitable investments with the promises of a reasonable yield and minimum
element of risk. Such a mechanism as provided by Stock Exchanges is not merely a source of
capital but also a conduit which channelises the savings into investment along with a free
movement of capital. With the probable exception of a totalitarian state no Government will be
able to mobilize resources from the public if the money market in the form of stock exchange
does not exist.
The Stock Exchange benefits the entire community in a variety of way. It enables the
producers to raise capital which directly and indirectly gives gainful employment to millions of
people on the one hand and helps consumers to get ;the variety of goods needed by them on the
other. It provides opportunities to savers to store the value either as temporary abode of
purchasing power or as a permanent abode of purchasing power in the form of financial assets. It
also helps the segments of the savers who put their savings in commercial firms and non-banking
financial intermediaries because these institutions avail themselves of the services of Stock
Exchange to invest the money thus collected. The Stock Exchange comes close enough to a
perfectly competitive market allowing the forces of demand and supply a reasonable degree of
freedom to operate as compared to other markets specially the commodity markets. This segment
of the factor market can be considered as a perfect or a nearly perfect market.
Apart from providing a mechanism for transacting business in stock and shares it generates
genuine potential for a new entrepreneur to take up initiative in the private sector enterprises and
allows the expansion of investing community by offering gainful development of their otherwise
sluggish or shy capital.
The Stock Exchange must assume the responsibility of protecting the rights of investors specially
the small investors in the Joint Stock Companies.
EVOLUTION OF STOCK EXCHANGES IN INDIA

Any attempt at raising the standard of living of the masses must address itself to the task of
producing the right quantity of the right types of goods and have them available for consumption
at the right time. This requires large-scale production through coordination of activities of
hundreds of people under the same roof even when the product is the simplest to make.
This, however, calls for raising vast amounts of financial resources for the purpose of acquiring
land, buildings and equipments, besides purchasing raw materials and employing labour. No one
individual or a small group of individuals is rich enough to provide all the capital required by
modern business enterprise and savings of hundreds, if not thousands, of people must be
mobilized.
The corporate form of organization is well adapted to the task of raising capital from many
people. This is done by issuing or offering for sale at cash, different types of securities, that is,
shares and bonds, which offer to individual investors a means of productively employing
capital/savings suited to his/her needs and temperament.
The need for offering for sale different types of securities is obvious. Some people may desire
safety of the amount they have invested and a regular income from their investment. To them the
corporation or company may offer debenture bonds- a certificate issued under the seal of the
company promising a refund of the loan on a specified date and payment of interest at prescribed
intervals.
Other investors may be willing to commit their savings for an indefinite period of time and to
assume greater risk while still desiring safety of capital and stability of income. To them the
corporation will sell preference shares. Still other investors may be willing to shoulder the
business risk that goes along with the ownership of the business in the hope that the profit
realized would be large enough to compensate the greater risk they are assuming. But no one will
buy these securities unless there exists an organized market where the holders can dispose of
them, should the need arise, and new investors can purchase them. Over the years, such
organized markets have come into existence in all democratic and capitalistic countries including
India. Such a market is called stock market or a stock exchange in English speaking countries
and a 'brouse' in continental Europe.
There is, obviously, no need for stock exchange in
Communist countries since in such countries all the productive organizations are owned by the
government.
Organized stock exchange in India are of recent origin. As late as 1933 there were only three
stock exchanges one each at Ahmedabad, Bombay and Calcutta, but trading in securities was in
vogue much prior to that year. Of course, no one can tell when the first transaction took place,
however, it is generally agreed that business in securities had begun as early as the concluding
years of the 18th century, that is, between the years 1790 and 1800 A.D.
Existing structure of the stock exchanges in India

The Act recognizes stock exchanges with different legal structure. Presently the stock exchanges
which are recognized under the Securities Contracts (Regulation) Act in India, could be
segregated into two broad groups 20 stock exchanges which were set up as companies, either
limited by guarantees or by shares, and the 3 stock exchanges which are functioning as
associations of persons (AOP) viz. BSE, Ahmedabad Stock Exchange and Indore Stock
Exchange. The 20 stock exchanges which are companies are: the stock exchanges of Bangalore,
Bhubaneswar, Calcutta, Cochin, Coimbatore, Delhi, Guwahati, Hyderabad, Interconnected SE,
Jaipur, Ludhiana, Madras, Magadh, Managalore, NSE, Pune, OTCEI, Saurashtra-Kutch, Uttar
Pradesh, and Vadodara. Of these, the stock exchanges of Ahmedabad, Bangalore, BSE, Calcutta,
Delhi, Hyderabad, Madhya Pradesh, Madras and Guwahati were given permanent recognition by
the Central Government at the time of setting up of these stock exchanges. Apart from NSE, all
stock exchanges whether established as corporate bodies or Association of Persons (AOPs), are
non-profit making organizations.
BOMBAY STOCK EXCHANGE

Established in 1875, BSE Ltd. (formerly known as Bombay Stock Exchange Ltd.), is Asias first
Stock Exchange and one of Indias leading exchange groups. Over the past 137 years, BSE has
facilitated the growth of the Indian corporate sector by providing it an efficient capital-raising
platform. Popularly known as BSE, the bourse was established as "The Native Share & Stock
Brokers' Association" in 1875. BSE is a corporatized and demutualised entity, with a broad
shareholder-base which includes two leading global exchanges, Deutsche Bourse and Singapore
Exchange as strategic partners.BSE provides an efficient and transparent market for trading in
equity, debt instruments, derivatives, mutual funds. It also has a platform for trading in equities
of small-and-medium enterprises(SME).
More than 5000 companies are listed on BSE making it world's No. 1 exchange in terms
of listed members. The companies listed on BSE Ltd command a total market capitalization of
USD 1.32 Trillion as of January 2013. It is also one of the worlds leading exchanges (3rd largest
in December 2012) for Index options trading (Source: World Federation of Exchanges).
BSE also provides a host of other services to capital market participants including risk
management, clearing, settlement, market data services and education. It has a global reach with
customers around the world and a nation-wide presence. BSE systems and processes are
designed to safeguard market integrity, drive the growth of the Indian capital market and
stimulate innovation and competition across all market segments.
BSE is the first exchange in India and second in the world to obtain an ISO 9001:2000
certification. It is also the first Exchange in the country and second in the world to receive
Information Security Management System Standard BS 7799-2-2002 certification for its OnLine trading System (BOLT). It operates one of the most respected capital market educational
institutes in the country (the BSE Institute Ltd.). BSE also provides depository services through
its Central Depository Services Ltd.(CDSL)arm.
BSEs popular equity index - the S&P BSE SENSEX - is India's most widely tracked stock
market benchmark index. It is traded internationally on the EUREX as well as leading
exchanges of the BRCS nations (Brazil, Russia, China and South Africa).
HOURS OF OPERATION:
Session
Timing
Pre-open Trading Session
09:00 - 09:15
Trading Session
09:15 - 15:30
Position Transfer Session
15:30 - 15:50
Closing Session
15:50 - 16:05
Option Exercise Session
16:05
The hours of operation for the BSE quoted above are stated in terms the local time (GMT +
5:30). BSE's normal trading sessions are on all days of the week except Saturday, Sundays and
holidays declared by the Exchange in advance.
NATIONAL STOCK EXCHANGE

The National Stock Exchange (NSE) is India's leading stock exchange covering
various cities and towns across the country. NSE was set up by leading institutions
to provide a modern, fully automated screen-based trading system with national
reach. The Exchange has brought about unparalleled transparency, speed &
efficiency, safety and market integrity. It has set up facilities that serve as a model
for the securities industry in terms of systems, practices and procedures.
NSE has played a catalytic role in reforming the Indian securities market in terms
of microstructure, market practices and trading volumes. The market today uses
state-of-art information technology to provide an efficient and transparent trading,
clearing and settlement mechanism, and has witnessed several innovations in
products & services viz. demutualization of stock exchange governance, screen
based trading, compression of settlement cycles, dematerialization and electronic
transfer of securities, securities lending and borrowing, professionalization of
trading members, fine-tuned risk management systems, emergence of clearing
corporations to assume counterparty risks, market of debt and derivative
instruments and intensive use of information technology.
The National Stock Exchange (NSE) is stock exchange located at Mumbai, India.
It is the 11th
largest
stock
exchange in the world by market
capitalization and largest in India by daily turnover and number of

trades, for both equities and derivative trading. NSE has a market
capitalization of around US$1 trillion and over 1,652 listings as of
July 2012.Though a number of other exchanges exist, NSE and
the Bombay Stock Exchange are the two most significant stock
exchanges in India and between them are responsible for the vast
majority of share transactions. The NSE's key index is the S&P CNX
Nifty, known as the NSE NIFTY (National Stock Exchange Fifty), an index of fifty major
stocks weighted by market capitalization.
NSE is mutually owned by a set of leading financial institutions, banks, insurance companies and
other financial intermediaries in India but its ownership and management operate as separate
entities. There are at least 2 foreign investors NYSE Euronext and Goldman Sachs who have
taken a stake in the NSE.As of 2006, the NSE VSAT terminals, 2799 in total, cover more than
1500 cities across India. In 2011, NSE was the third largest stock exchange in the world in terms
of the number of contracts (1221 million) traded in equity derivatives. It is the second fastest
growing stock exchange in the world with a recorded growth of 16.6%.
ORIGIN OF NSE: The National Stock Exchange of India was set up by Government of
India on the recommendation of Pherwani Committee in 1991.Promoted by leading Financial
institutions essentially led by IDBI at the behest of the Government of India, it was incorporated
in November 1992 as a tax-paying company. In April 1993, it was recognized as a stock
exchange under theSecurities Contracts (Regulation) Act, 1956. NSE commenced operations in
the Wholesale Debt Market (WDM) segment in June 1994. The Capital market (Equities)
segment of the NSE commenced operations in November 1994, while operations in
the Derivatives segment commenced in June 2000.
OBJECTIVES OF NSE: .
Establishing nationwide trading facilities for all types of securities.

Ensuring equal access to investors all-over the country through an appropriate
communication network
Meeting international benchmarks and standards.
Enabling shorter settlement cycles and book entry settlements
MARKETS: Currently, NSE has the following major segments of the capital market
Equities
Equities
Indices
Mutual Funds
Exchange Traded Funds
Initial Public Offerings
Security Lending and Borrowing Scheme
Derivatives
Equity Derivatives (including Global Indices like S&P 500, Dow Jones and FTSE )
Currency Derivatives
Interest Rate Futures
Debt
Retail Debt Market
Wholesale Debt Market
Corporate Bonds
Equity Derivatives The National Stock Exchange of India Limited (NSE) commenced
trading in derivatives with the launch of index futures on June 12, 2000. The futures and options
segment of NSE has made a mark for itself globally. In the Futures and Options segment, trading
in S&P CNX Nifty Index, CNX IT index, Bank Nifty Index, Nifty Midcap 50 index and single
stocks are available. Trading in Mini Nifty Futures & Options and Long term Options on S&P
CNX Nifty are also available. The average daily turnover in the F&O Segment of the Exchange
during 2009-10 was ` 72,392 crore (US $ 16,097 million)
On August 29, 2011, National Stock exchange launched derivative contracts on the worlds most
followed equity indices, the S&P 500 and the Dow Jones Industrial Average. This was the first
time that derivative contracts on global indices are available in India. This is the also the first
time in the world that futures contracts on the S&P 500 index were introduced and listed on an
exchange outside of their home country, USA. The new contracts include futures on both the
DJIA and the S&P 500, and options on the S&P 500. The first day volumes at the close of trading
on August 29, 2011 at 3.30 pm, on the 2 indices in futures and options contracts were nearly
Rs.122 crores (1220 million).
On May 3, 2012,The National Stock exchange launched derivative contracts (futures and
options) on FTSE 100, the widely tracked index of the UK equity stock market. This was the
first of its kind for an index of the UK equity stock market to be launched in India. FTSE 100
includes 100 largest UK listed blue chip companies and has given returns of 17.8 per cent on
investment over three years. The index constitutes 85.6 per cent of UKs equity market cap. NSE
recorded a volume of 500 crores (5000 million) on the 1st day of trading.
Currency Derivatives In August 2008 currency derivatives were introduced in India with
the launch of Currency Futures in USD INR by NSE. It also added currency futures in euros,
pounds and yen. Interest Rate Futures were introduced for the first time in India by NSE on 31
August 2009, exactly one year after the launch of Currency Futures.
Debt Market NSE became the first stock exchange to get approval for interest rate futures, As
recommended by SEBI-RBI committee, on 31 August 2009, a futures contract based on 7% 10
Year Government of India (Notional) was launched with quarterly maturities.
GLOBAL MARKETS MOVEMENT:
The movement of a few of the selected indices presented in Table 4-6 brings out the trends
witnessed in the Indian and foreign markets during 2010-2011and 2011-2012. A global
comparison of these selected indices indicates that in 2010-11, all these indices barring Nikkei
225 witnessed average returns in the range of 10-15 percent. However, in 2011-2012 all these
indices depicted varied kinds of performance, US indices and Nikkei225 managed to close in
green and rest al indices closed in red compared to 2010-2011 values. The period AprilSeptember 2012 saw some mixed performance again. The S&P CNX Nifty gained 7.7 percent,
while the Nikkei 225 Index lost the maximum ground, to the tune of 12.1percent in the first six
months of 2012-13.
Table4-6:Movement of Select Indices on Indian & Foreign Markets
Index-Country
IndexValueason
Changedurin
g2011-12
(Percent)
Changedurin
gApr-Sep'12(
Percent)
31-Mar-11
31-Mar-12
30-Sep-12
12319.73
13212.04
13437.13
7.2
1.7
Nasdaq-US
2781.07
3091.57
3116.23
11.2
0.8
FTSE100-UK
5908.80
5768.45
5742.07
-2.4
-0.5
CAC-France
3989.18
3423.81
3354.82
-14.2
-2.0
5833.75
5295.55
5703.30
-9.2
7.7
BSESensex-India
19445.22
17404.20
18762.74
-10.5
7.8
HangSeng-HongKong(China)
23527.52
20555.58
20840.38
-12.6
1.4
Nikkei-Japan
9755.10
10083.56
8870.16
3.4
-12
Kospi-SouthKorea
2106.70
2014.04
1996.21
-4.4
-0.9
DowJones-US
AsiaPacific
Europe Americas
Region
Nifty50(S&PCNXNifty)-India
Source:Bloomberg,BSE&NSE
Comparing the movement of the Nifty, SENSEX, and NASDAQ over 2010-2011 (as depicted
in Chart4- 1) , the Nifty 50 performed better than other Asian indices such as the Nikkie225
and the Hang Seng Index for most of the year. The returns on the NASDAQ were 11.2 percent
in 2011-2012, while that of the FTSE100 and the Hang Seng Index declined to 2.4 percent
and12.6 percent, respectively, over the same period (Table4-6). The Japanese stock market
indicator Nikkie225 yielded returns of 3.4 percent.
Source:NSE,Bloomberg
CHAPTER-III
COMPANY PROFILE
Brief History of company

Structure of the company
Investment advisory services
Portfolio management services
HISTORY OF THE ANGEL BROKING
Angel Broking's tryst with excellence in customer relations began in 1987. Today, Angel has
emerged as one of the most respected Stock-Broking and Wealth Management Companies in
India. With its unique retail-focused stock trading business model, Angel is committed to
providing Real Value for Money to all its clients.
It has membership on Bombay Stock Exchange (BSE), National Stock Exchange (NSE) and the
leading Commodity Exchanges in the India NCDEX & MCX. Angel is also registered as a
Depository Participant with CDSL.
Angel Group Companies:
Angel Broking Ltd

- Members on the BSE and Depository participant with CDSL
Angel Capital & Debt Market Ltd Membership on the NSE Cash and Futures &
options Segment
Angel commodities Broking Ltd Member on the NCDEX & MCX
Angel securities Ltd Member on the BSE.
Incorporated
1987
BSE Membership
1997
NSE Membership
1998
Member of NCDEX&MCX
Depositor Participants with CDSL
Angels presence:
Nation-wide network of 21 regional hubs
Presence 124 cities
6800 + sub brokers and business associates
5.9 lakh + clients
Management:
S.N
O
Name
Mr. Dinesh
Thakkar
Mr. Lalit Thakkar
Mr. Amit
Majumdar
Mr. Rajiv Phadke
Mr. Vinay Agarwal
Mr. Nikil Daxini
Mr. Hitungshu
Debnath
1
2
3
Designation & Department

Founder Chairman &
Managing Director
Director-Research
Executive Director-Strategy
and Finance
Executive Director-HR & Corp
Executive Director-Equity
Broking
Executive Director-Sales &
Marketing
Executive DirectorDistribution & Wealth
Management
Awards & Milestones:
May,2009:Angel Broking wins two prestigious awards for 'Broking House with Largest
Distribution Network' and 'Best Retail Broking House' at Dun & Bradstreet Equity
Broking Awards
August,2008:Angel Broking crosses 5,00,000 mark in unique trading accounts
November, 2007 Major Volume Driver for 2007
December, 2006 Created 2500 business associates

September, 2006 Launched Mutual Fund and IPO business
July, 2006 Launched the PMS function
September, 2004 Launched Online Trading Platform
April, 2004 Initiated Commodities Broking division
April, 2003 First published research report
November, 2002 Angels first investor seminar
March, 2002 Developed web-enabled back office software
November, 1998 Angel Capital and Debt Market Ltd. Incorporated
December, 1997 Angel Broking Ltd. Incorporated
Vision of the Company:

To provide best value for money to investors through innovative products, trading/investments
strategies, state of the art technology and personalized service.
Philosophy of the Company:
Ethical practices & transparency in all our dealings

Customers interest above our own
Always deliver what we promise
Effective cost management
Quality Assurance Policy:

We are committed to providing world-class products and services which exceed
the expectations of our customers, achieved by teamwork and a process of
continuous improvement.
CRM Policy : Customer is King
A Customer is the most Important Visitor on our premises. He is not dependent on us, but we are
dependent on him. He is not an interruption in our work. He is the purpose of it. He is not an
outsider in our business. He is part of it. We are not doing him a favour by serving.He is doing us
a favour by giving us an opportunity to do so.
Logo of the Company:
OUR ORGANISATIONAL SRUCTURE:
Business Associates
Products of Angel Broking:
Online Trading
Commodities
Portfolio Management Services
Mutual Funds
Life Insurance
IPO
Depository Services
Personal loans
E-Broking:
Angel has different products and voila trading on BSC,NSE,F&O,MCX & NCDEX. It provides
four softwares to customers for online trading.
Angel Investor:
User-friendly browser for investors

Easy online trading platform
Works in proxy and firewall system setup
Integrate Back office: Access account information-anytime, anywhere
Angel Trade:
Browser based for investor

No installation required
Advantage of mobility
Angel Diet:
Application based ideal for traders

User friendly and simple navigation
Angel Anywhere:
Application-based platform for day traders

Intra-day/historical charts with various indicators
BSC,NSC,Cash &Derivatives
Investment Advisory services:

To derive optimum returns from equity as an asset classes requires professional guidance and
advise. Professional assistance will always be beneficial in wealth creation. Investment decisions
without expert advises would be like treating alignment without the help of a doctor.
Expert advise
Timely Entry and Exit.
De-Risking Portfolio.
Commodities:
Commodity is a basic good representing a monitory value.Commodities are most often used as
inputs in the production of other goods or services.
Types of Commodities:
Precious metals
Gold and silver
Base Metals
Copper, zinc and aluminium
Energy
Crude oil, Brent crude and natural Gas
Pulses
Chana, urad and Tur
Benefits at Angel:
Three different online products tailored for traders and investors.

Single screen customised Market-watch for MCX/NCDEX with BSE/NSE.
Streaming Quotes and real time rates. Intra-day trading calls.
An array of daily, weekly an special research reports.
Seminars,workshops and investment camps for investors
Depository Participant service:
Wide branch coverage

Personalised/attentive services of trained a dedicated staff
Centralised building and accounting
Acceptances and executions of instructions on fax.
Daily statement of transactions and holding statement on e-mail
No charges for extra transaction statement and holdings statement
Portfolio Management Services:

Successful investing in capital markets demands every more time and expertise. Investment
management is an art and a science in itself.The portfolio management service combined with
competent fund management, dedicate research and technology, ensures rewarding experience
for its clients.
Mutual Fund:
To enable clients to diversify their investment in right direction.Angel broking as added another
product in its range with mutual funds
Access to in-depth research and proper selection from diversified funds based on your
preferred criteria
Rating and ranking for all mutual funds from our in house expert analysts
Current and historical performance of different funds enable comparisons.
Benefits:
No risk of loss,wrong transfer, mutilation or theft of share certificates

Hassle free automated pay-in of your sell obligations by your clearing members
Reduced paper work
Instant disbursement of non-cash benefits like bonus and rights into your account
Efficient pledge mechanism
CHAPTER-IV
DATA ANALYSIS
&
INTERPRETATION
Calculation of correlation between global and Indian markets

- Calculation of volatility between BSE and NSE
VOLATILITY OF NIFTY AND SENSEX DURING BUDGET

SESSION
NIFTY DURING BUDGET HOURS:
NSE
5834
5836
5831
5827
deviati squa
ons
res
36.333 1320.
333
11
38.333 1469.
333
44
33.333 1111.
333
11
29.333 860.4
333
44
5812
5799
5773
5774
5693
total
mea
n
14.333
333
1.3333
333
24.666
67
23.666
67
104.66
67
5217
9
5797
.67
Volatility
205.4
44
1.777
78
608.4
44
560.1
11
1095
5.1
1709
2
1899
.11
43.5
78
SENSEX DURING BUDGET HOURS:
BSE
deviatio
ns
squar
es
Total
mea
n
1926
5
1929
2
1927
4
1922
9
1922
0
1915
8
1910
4
1907
2
1886
2
1724
76
1916
4
Volatility
101
10201
128
16384
110
12100
65
4225
56
3136
-6
36
-60
3600
-92
8464
-302
91204
14935
0
1659
4.4
128.8
19
INTERPRETATION:
The volatility of sensex is very high when compared with Nifty at the time of budget.
CORRELATION BETWEEN THE GLOBAL MARKETS WITH

NIFTY:
Days
Mon 4
Tue 5
Wed 6
Thu 7
Fri 8
Correlat
ion
Nikkie 225
Prev.Cl Open
ose
Price@12:15
Pm
11606. 11685.93
38
11652.
29
11683.
45
11932.
27
11968.
08
11756.41
11830.61
11999.38
12191.35
%Cha
nge
S&P Cnx Nifty

Close Open
Price
0.685
399
5719.
7
5698.5
0.893
558
1.259
559
0.562
424
1.865
546
5698.
5
5784.
25
5818.
6
5863.
3
5784.2
5
5818.6
5863.3
5945.7
%Cha
nge
0.370
65
1.504
782
0.593
854
0.768
226
1.405
352
0.4939
45
Interpretation:
The Above Table Depicts The Correlation Between Nikkie With Nifty. The Values Shows That
Japan Market Moderately Correlated With Indian Market In Asia Japan Economy Is Considered
As One Of The Bigger Economy As Flows Of Fii Are Impacting The Indian Markets.
CORRELATION BETWEEN THE SHANGI WITH NIFTY:
Days
Mon 4
Tue 5
Shang
ai
Prv.Clo
se
2359.
51
S&P Cnx Nifty

Open
Price@11:15am
2300.566
2273.
4
2326.
31
2347.
18
2298.519
Fri 8
2324.
29
2323.794
Correlat
ion
0.843
945
Wed 6
Thu 7
Interpretation:-
2341.482
2343.915
%Chn
age
2.498
15
1.104
909
0.652
192
0.139
1
0.021
34
Close
5719.
7
Open
Price
5698.5
5698.
5
5784.
25
5818.
6
5784.2
5
5818.6
5863.
3
5945.7
5863.3
%Cha
nge
0.370
65
1.504
782
0.593
854
0.768
226
1.405
352
As Correlation Is High Between China And India ,The Impact Of China On Indian Stock
Market Is Moderately Effected. In Our Asian Economy China And India Growth Is More That Is
The Reason Fdi And Fii Flows Are Very High On The Two Countries.
CORRELATION BETWEEN THE HANGSENG WITH NIFTY:
Days
Mon 4
Tue 5
Wed 6
Thu 7
Fri 8
Correlat
ion
Hang Seng
Prv.Clo Open
se
Price@11:15am
22880 22645
.22
22537
.8
22560
.5
22777
.84
22771
.96
0.787
64
Interpretations:
22610.59
22742.54
22800.69
23001.03
%Chn
ge
1.028
05
0.322
969
0.806
893
0.100
312
1.005
948
S&P Cnx Nifty

Close Open
Price
5719. 5698.5
7
5698.
5
5784.
25
5818.
6
5863.
3
5784.2
5
5818.6
5863.3
5945.7
%Cha
nge
0.370
65
1.504
782
0.593
854
0.768
226
1.405
352
When Correlation Between Hangseng And S&P Cnx Nifty Is High, Our Indian Economy
Performed Well Due To Positive Aspects On India.
CORRELATION BETWEEN THE FTSE 100 INDEX WITH

NIFTY:
Ftse 100
Prev.Cl
ose
6378.6
Index
Open
Price
6379.2
7
%Chn
age
0.010
504
S&P Cnx Nifty

12:30 012:40
pm
pm
5687. 5677.6
25
Tue 5
6345.6
3
6345.7
2
0.001
418
5755.
6
5752.4
6
Wed 6
6431.9
5
6427.6
4
6432.3
2
6427.5
6
5183.
7
5813.
1
5812.1
5
5808.4
5
6439.1
6
6439.2
0.005
753
0.001
24
0.000
621
5893.
25
5897.2
5
Days
Mon 4
Thu 7
Fri 8
%Cha
nge
0.169
68
0.054
56
12.12
358
0.079
99
0.067
874
Correlat
ion
0.2670
06
Interpretation:-
Even Though London Stock Market Is 3 Largest Economy In The World ,As The
Movements Of This Stock Market Is Less Active With Our Indian Economy,
Indian Stock Markets Are Least Effected.
CORRELATION BETWEEN THE CAC 40 INDEX WITH NIFTY:
Cac
40
Pr.Clo
se
3699.
91
Op
Price
3699.
91
%Cha
nge
0
12:30
pm
5687.
25
012:40
pm
5677.6
Tue 5
3709.
76
3709.
76
5755.
6
5752.4
6
Wed 6
3787.
19
3773.
76
3787.
19
3773.
76
5183.
7
5813.
1
5812.1
5
5808.4
5
Days
Mon 4
Thu 7
S&P Cnx Nifty
%Cha
nge
0.169
68
0.054
56
12.12
358
0.079
Fri 8
3793.
78
Correlat
ion
=0
3793.
78
5893.
25
5897.2
5
99
0.067
874
Interpretation:
As Correlation Is Zero There Is No Effect Of French Market On Indian Economy.
CHAPTER-V
FINDINGS
FINDINGS:
U.S.A markets are most influencing one in the world.70% of the world economy is moved by the
global markets and in that US is playing the vital role. Based on time zone analysis Asian
markets are opening based on last night closing of US markets. European markets are also major
markets than India, according Indian time 12:30pm to 12:40pm in between these markets will
open. Opening of European also will have its impact on us.
There is huge volatility between NSE and BSE during budget session
The correlation between NIKKIE 225 and NIFTY is 0.493945.So,the Japan market
is moderately correlated with Indian market in Asia.

The correlation between SHANGAI and NIFTY is 0.843945.So,the China markets
are highly correlated with Indian markets

The correlation between the HANG SENG and NIFTY is 0.78764. so, the
HONGKONG markets are highly correlated with Indian markets.

The correlation between the FTSE 100 and NIFTY is 0.267006.So,the UNITED
KINGDOM markets are slightly correlated with Indian markets.

The correlation between CAC 40 and NIFTY is 0.So,the EUROUP markets are
slightly correlated with Indian markets.
CHAPTER-VI
SUGGESTIONS
Suggestions:
1.Trading Should Start At 8o Clock In The Morning And End At 4o Clock In The Evening
With One Hour Break Between1pm To 2pm.
2.There Should Be 24 Hours F &O
3. The Pre Open Session Should Be Introduced For IPO'S On Listing Day.
4. NSE Along with SEBI Should Take More Initiative To Increase The Awareness About The
Market From Schooling.
5. The Exchange Has To Increase Their Branches & Network.
6.Nse Should Change The Calculations Of Stock Settlement Prices After Closing The Market.
7. Brokers Are Blocking Illiquid Counters By Stopping Trading In Particular Companies. SEBI
And Exchange Should Guide The All The Brokers To All Trading In All The Stocks Which Are
There In NSE And BSE.
CHAPTER-VII
CONCLUSIONS
Conclusion:
I Conclude The Analysis On The Correlation Of Indian Stock Market With Global Markets. In
The Modern Economic, Investment Are Taking Place Across The Global, Flow Of Fund Are
Rolling With The Growth Nation In The Form Of Fiis. Global Market Are Impacting The India
Stock Market In The Analysis I Have Measured The Co- Relation Between Asian Market
European Market With India Based On The Time Zone Analysis I Found Japan And Germany
Are Having High Co relation With India, There Is A Scope For The Further Research To Measure
The Impact On India Markets With Global Markets.
CHAPTER-VIII
BIBILOGRAPHY
BIBLIOGRAPHY
WEBSITES:
http://www.nseindia.com/
http://www.rbi.org.in/home.aspx
http://www.sebi.gov.in/sebiweb/
http://www.forex.com/pages/land-international.html
NEWSPAPERS:
Economic Times
Business Line

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CHAPTER - 1

Accounting personnel, who need to know whether the organization will be

Potential lenders or creditors, who want a clear picture of a company's ability

Potential investors, who need to judge whether the company is financially

Potential employees or contractors, who need to know whether the company

Shareholders of the business.

NEED AND IMPORTANCE OF STUDY

SCOPE OF THE STUDY:

This study is to know working capital increase or decrease funds from

Management information system published by

Status Report on Ultra Tech Cements Limited.

Journals, books and other published reports.

collection. The primary data was directly collected by observations, Interviews

LIMITATIONS OF THE STUDY:

Cement industry in India:

infrastructure sector, the capacity is expected to increase to around 550 MT by

Malabar Cements plans to set up an automated cement handling and bagging

Reliance Cement Company (RCC), a subsidiary of Reliance Infrastructure, has

Reliance Cement Co, a special purpose vehicle (SPV) of Reliance Infrastructure

China tackles pollution and overcapacity:

Competition in sub-Saharan Africa is set to intensify when Nigeria's Dangote

Saudi Arabian infrastructure demands have created all sorts of reverberations

Growth continues to dominate these regions and major sporting

Types of modern cement

Portland pozzolan cement: from other natural or artificial pozzolans. In countries

cements: may be made using white clinker and white

supplementary materials such as high-purity met kaolin.

in Cement chemist's notation) as a primary phase. They are

UltraTech Cement Limited has an annual capacity of 18.2 million tonnes. It

Aditya Vikram Birla: putting India on the world map

Mr. Kumar Mangalam Birla, Chairman

Mrs. Rajashree Birla

Mr. S. Misra, Managing Director

Executive President & Chief Financial Officer:

Chief Manufacturing Officer :

Chief Marketing Officer :

Associated with Government projects & Business World FICCI-SEDF

Subh Karan Sarawagi Environment Award

Business World FICCI-SEDF CSR Award

Genentech Environment Excellence Gold Award

IMC Ramakrishna Bajaj National Quality Award

Asian CSR Award

National Award for Prevention of Pollution

Rajiv Gandhi Environment Award for Clean Technology

State Level Environment Award (Plant)

Our focus areas:

Grasim Industries Ltd.

:: Hindalco Industries Ltd.

Aditya Birla Minacs IT Services Ltd.

:: Aditya Birla Minacs Worldwide Limited

:: Indo Thai Synthetics

Indo Phil Group of companies

:: Pan Century Surfactants Inc.

PT Indo Bharat Rayon

:: PT Elegant Textile Industry

:: PT Indo Liberty Textiles

Alexandria Carbon Black Company S.A.E

:: Alexandria Fiber Company S.A.E

Liaoning Birla Carbon

:: Birla Jingwei Fibres Company Limited

Aditya Birla Minerals Ltd.

Birla Laos Pulp & Plantations Company Limited

North and South America, Europe and Asia:

Swiss Singapore Overseas Enterprises Ptv. Ltd. (SSOE)