A PROJECT REPORT

ON

WORKING CAPITAL MANAGEMENT

AT

BALLARPUR INDUSTRIES LTD.

(UNIT SHREE GOPAL, YAMUNA NAGAR) Submitted to

MAHARSHI MARKANDESHWAR UNIVERSITY,MULLANA

In the partial fulfillment of the award of Master Of Business Administration
(Session 2007-2009)

Submitted By:
MANDEEP KAUR

Roll No.- 1207825

Class M.B.A 3RD SEM

DEPARTMENT OF BUSINESS MANAGEMENT

MAHARISHI MARKANDESHWAR INSITUTE OF MANAGEMENT CONTENTS

PREFACE CERTIFICATE FROM THE ORGANISATION ACKNOWLEDGEMENT DECLARATION INTRODUCTION HISTORY & BACKGROUND LOCATION OF BILT VARIOUS DEPARTMENT S AT UNIT SHREE GOPAL ORGANISATION STRUCTURE EXECTIVE SUMMARY INTRODUCTION INTRODUCTION TO WORKING CAPITAL LITERATURE REVIEW RESEARCH METHODOLOGY

OBJECTIVE OF THE STUDY LIMITATION OF THE STUDY INDUSTRY PROFILE STRUCTURE OF FINANACE DEPARTMENT

 COMPANY PROFILE SWOT ANALYSIS, SUGGESTION ,CONCLUSION

PREFACE
MBA is stepping - stone to Management career. In order to achieve practical, positive and concrete results the theoretical knowledge must be supplemented with exposure to real environment. Theoretical knowledge without practical knowledge is of little value. Theoretical studies in classroom are not sufficient to understand the functioning of complex and large sized organization. Therefore, it becomes necessary to undergo any project work. Practical supplements the theoretical studies i.e.; it covers what is left uncovered in the classroom. It exposes a student to invaluable treasure of experiences. I took my project work with BILT. Project work is a part of our curriculum, which helps us to correlate our theoretical concepts with practical experiences. The topic that I have taken for project is "WORKING CAPITAL MANAGEMENT " has been suggested to me by finance department (BILT UNIT Shree Gopal). Accomplishment and achievement of goals is the major aim of any organization. These goals are achieved by proper planning. Working capital management and

inventory management plays an important role in achieving these goals. As blood is essential in human body to live, working capital is also essential to carry out day - to - day operations of an organization. If a company has adequate working capital, it can raise loans easily, purchase raw materials timely etc. and overall, it helps in maintaining goodwill.

ACKNOWLEDGEMENT
Heartfelt thanks to those who support me
It often happens that one is at loss of words when one is really thankful and sincerely wants to express one's feeling of gratitude towards other. I am earnestly grateful to Mr. RAKESH CHAWLA Manager (Finance) Ballarpur Industries Ltd.; Yamuna Nagar for providing me an opportunity to undertake project work in their esteemed organization and practical training which will go long term in shaping my career. I also express my deepest respect to Mr. SL ARORA (Assistant manager) for their caring and guiding support and for giving a very patient hearing whenever I need and provided me a lot of practical training, which helps us in future too. He directly made a significant contribution to emergence to this project report.

I am deeply indebted to all my faculty members of the institute for their valuable contribution during the academic session & guidance in preparation of this project report. Finally, it is efforts of my parents and esteemed friends and the Almighty GOD who have been a source of strength and confidence for me in this endeavor.
(MANDEEP KAUR)

DECLARATION
This is to certify that I MANDEEP KAUR the student of MAHARISHI MARKANDESHWAR INSITUTE MGT.studying in MBA (IIIrd Sem.). Roll no. 1207825 has undergone summer/industrial training in Ballarpur Industries Ltd. (BILT), Yamuna Nagar for six weeks and have submitted a project/industrial report on the title "Working Capital Management as assigned by the Company, for partial fulfillment of Degree of Master of Business Administration (M.B.A.) to MAHARISHI MARKANDESHWAR UNIVERSITY ,MULLANA.. I solemnly declared that the work done by me is original and no copy of it has been submit to any other Universities for award of any other degree/diploma/fellowship or on similar title and topic.

Signature of Student (MANDEEP KAUR) Countersigned

Mr .Sanjeev Marwah
Director M.M.IM MULLANA.

INTRODUCTIO N

HISTORY AND BACKGROUND

Ballarpur Industries Limited (BILT) IS known as the backbone of the Thapar group. The founder of the Thapar group was Late Lala Karam Chand Thapar (1900 - 1962). One of the most illustrious industrial chains in India, Thapar group consists of many major industries such as paper, chemicals, glass, pulp, china clay, electronic etc. LALA KARAM CHAND started his career 1922 as a coal agent. In a short span of time he was known as a coal king. After improving his financial position KCT thought for entering into industries. Foundation Company of England initially promoted the company in 1927 by the name of M/s Punjab Pulp & Paper Company. The foundation Company pushed up its turbine but something went wrong & the entire generating set was blown, the mill was laid shut for 6 months & was ultimately auctioned. At present Unit SHREE GOPAL is producing around 250 TPD of paper. This unit consists of Six paper machines Two coating plants Three finishing houses Two power houses One caustic soda plant

 New pulp mill BALLARPUR INDUSTRIES LIMITED, popularly known as BILT is 'efficiently managed, 'financially sound', and 'self sufficient' and 'self made company' is the flagship of the coveted THAPAR GROUPS.The THAPAR Group has a wide range of activities like paper, engineering, leather etc. There are 54 companies and 84 plants under this group. Some of the main companies under this group are Crompton greaves, K.C.L; BROEOS JCT Limited, BILT. BALLARPUR INDUSTRIES LTD.(BILT) promoted by LM THAPAR is the leader in Indian paper industry with an annual production capacity of 460000 MT spread over in five manufacturing facilities produces ordinary and superior varieties of writing, printing, and specialty papers etc. BILT, which is originally incorporated in 1945 as BALLARPUR Straw Board Mills, has changed its name in march 1946 to BALLARPUR paper and straw board mills and again it was changed to the present name in October 1975. Since then the company has grown to be a leader in paper industry by continuous expansion and modernization of its capacity and plant and strategic acquisitions. In 1969 the company has merged

SHREE GOPAL paper Mills with itself and the company which has acquired the Sinar Mass Pulp and paper (India) Ltd. now BILT Graphic papers Ltd. (BGPL) which has state of the art 15000 TPA paper plant and a market leader in the high end coated art paper and art paper board segment in India is planning to bring the paper unit of BGPL into its fold and consolidating its paper operation under one umbrella.

The company which was one of the most diversified companies in the pre - liberalization era of industrial licensing with interests in paper, chemicals (phosphoric Acid, STPP, Chlor, Alkalies), Vanaspati & Edible oils and Glass has decided to focus on its core competence that is paper and exit from non - core business. First major steps on these lines were initiated in the year 1994 - 1995 with having off Glass business. Therefore the company sold its vananspati and Edible oils business.

In 1996 - 97 and is 1998, the chemical division of the company with its plant at Karwar, Karnataka and which has interests in phosphates, Chlor Alkali and Bromine Chemicals Ltd. (now Solaries Chem. Tech. Ltd.). To complement its restructuring and to enable it to emerge as a stronger and more competitive organization, the company is implementing a project involving modernization and expansion of capacity at its Units in Shree Gopal, Ballarpur and Sewa by 105000 TPA.

The project will be implemented in two phases:In the first phase, the capacity expansion

of 35000 TPA and 28000 TPA is planned over a two - year period from 2000 - 01 to 2002 - 03 for Units Sewa and Shree Gopal. In the second phase, 42000 TPA of capacity is expected to come on stream at Unit Ballarpur by 2003 - 04. During the year 2001 - 02, the company has completed the up gradation of Pulp Mill at Unit Sewa resulting in increasing in capacity by 37 tones from the earlier 125 tones of unbleached pulp per day. The company has also completed installation of a 2.4 meter wide blade coater at Unit Shree Gopal in FY 2001 - 02. BILT entered into strategic alliance with IIansol of South Korea to provide world

class blade coated paper to the Indian customer. It is the first company in the world to commercially exploit the fractionation of bamboo and has applied for the world patent for this process. It has also entered into direct retail distribution with the launch of A4 size 100 - sheet pack of Royal Executive Board. Mr. Gautam Thapar, Managing Director of BILT, has been associated with BILT since 1986 when joined the company as Shop Floor Management Apprentice - Paper Mills and was instrumental in turning around BILT in the late 1990s. BILT consists of Five units:1) Ballarpur Unit, Distt. Chanderpur, Maharashtra 2) Shree Gopal Unit, Yamunanagar, Haryana
3)

Sewa Unit, Orissa

4) Asthi Unit, Maharashtra 5) Unit Choudhwar, Orrisa From the beginning in paper, BALLARPUR INDUSTRIES LIMITED is now a multifaceted enterprise with interest allied to as well as remarkably varied from paper. The operations of the company traverse products divisions as well as international boundaries, making it today the core of the THAPAR GROUP and forming together with subsidiary and associates companies a

group in itself with its center of operations at its head office New Delhi.

LOCATION OF BILT
UNIT SHREE GOPAL is situated in the heart of Yamuna Nagar city. The unit is spread over an area of 3sq. km and also has modern residential colony for its employees with all modern amenities like - hospital, school, club, playground, community hall etc. The unit is situated in the midway to the railway station and the bus stand. It has got its own residential colony. There is no problem of waste disposal. The unit has its own railway line running inside so that transportation of raw material is facilitated. There are main gates for entry and watchmen are there to look after One gate opens in the main market of the Yamuna Nagar and the other two in the different direction, which make it well connected to the other parts of the city. BILT is a small town itself with all facilities available.

VARIOUS DEPARTMENTS AT

UNIT SHREE GOPAL

ADMINISTRATIVE DEPARTMENT 1. PDC-People development and communication:- This department is primarily concerned with the training,

selection recruitment, promotion, demotion, labour welfare, retirement, work culture and awareness. 2. Accounts Department:The function of this

department is to maintain every detail and record of all the transactions covered by different department 3. General concerned material. 4. Marketing & Sales department:- Sailing out finished paper is their main activity.
5.

Store with

department procurement

:and

These storage

people of

are

process

Raw material department:- Each and every product required for paper making is arranged/ purchased by this department.

6.

Traffic department:-

This department includes wing

section, raw material section, transport section etc. PROCESS DEPARTMENT:

1.

Pulp Mill:- its function includes manufacturing of pulp and stock preparation.

2.

Machine house :- It controls the working of various paper machine and prepare the paper of required quantity.

3.

Coating plant:- Primary function of this department concern with coating of paper as per requirements.

4.

Soda recovery plant:- Function of this department is to look after the process of recovery of useful chemical from waste liquor.

5.

Caustic soda chlorine plant( CSCP):- This department supervises the production of Hcl and NaOH.

ENGINEERING DEPARTMENTS:1.Electrical engineering:- This department attaches itself with the maintenance of installation of electrical machine, distribution and generation of electrical energy and various other electrical installation at the unit. 2.Machine engineering:- This department is concerned with the maintenance of various machine, boiler operations etc. 3.Civil engineering:- All the construction work like- building of roads , sanitary, waste disposal, water supply etc. are under their control.

4.Instrumentation

engineering:-

Maintenance

of

all

the

electrical controls of the machines is carried out under the expert guidance. 5.Power house:- Having the total installed capacity of 25MW and maintain by two power house, old and new, this department backup's, the total power demand of the unit efficiently and effectively.

OGRANISATION STRUCTURE
V.P. and M.D. GROUP II HEAD CHIEF GENERAL MANAGER

PEOPLE DEVELOPMENT & COMMUNICATION

COMMERCIAL & RAW MATERIAL

RESEARCH AND DEVELOPMEN

PAPER PRODUCTION

ENGG. SERVICES

MEDICAL

EXECUTIVE SUMMARY
UNIT SHREE GOPAL

Unit Shree Gopal is situated at Yamuna Nagar in Haryana. It contributes about 30% towards total production of paper manufactured by BILT. This mill was taken by Thapar in 1936-37. It took over years in the process of rebuilding, expansion and diversification.

The unit employs 3605 people and manufactures quality-writing, printing and coated paper. The unit has six large and high - speed machines that takes in all kinds of raw materials like grasses, baggage, cotton waste to turnout special paper with an exquisite finish.

The unit has also three - pulp machine to convert raw material into pulp for paper, capacity of seven - paper machine is 70000 tonnes of paper, along with that unit also has got two paper coating machines with a capacity of production 17000 tonnes of coated paper. Originally Punjab pulp and paper mills, it was

promoted by Lala Kashi Ram in 1928 acquired by Late Lala Karam Chand Thaper in 1936.

AREA & PRODUCTION

Total Area

206 Acres

Factory Area

155 Acres

Colony Area

:s

51 Acres

Turnover

Rs. 24-26 crore per month

Production

App. 6000 MT per month

Dispatch

App. 6000 MT per month

INTRODUCTIO N

INTRODUCTION TO WOKING CAPITAL MANAGEMENT

Meaning of working Capital
Capital required for a business can be classified under two main categories . 1. 2. Fixed capital Working capital Every business needs funds for two purposes - for its establishment and to carry out its day to day operation. Long term funds are required to create production facilities through purchase of fixed assets such as plant and machinery, land building, furniture etc. investment in these assets represent that part of firm's capital which is blocked on a permanent or fixed basis and is called fixed capital. Funds are also needed for short term purpose for the purchase of raw materials, payment of wages and other day to day expense, etc. These funds are known as working capital which is required for financing short term of current assets such as cash, marketable securities, debtors and inventories. Funds thus invested in current assets keep revolving

fast and are being constantly converted into cash and this cash flows out again in exchange capital of short term capital.

CONCEPTS OF WORKING CAPITAL

There are two concepts of working capital: a. b. Gross working capital. Net working capital. In the broad sense, the term working capital refers to the gross working capital and represents the amount of funds invested in current assets. Thus the gross working capital is the capital invested in total current sets of the enterprise. Current assets are those assets which in the ordinary course of business can be converted into cash with a short period of normally one accounting year. Examples

CONSTITUENTS OF CURRENT ASSETS

1. Cash in hand and bank balance 2. Bills receivables. 3. Sundry debtors. 4. Short term loans and advances. 5. Inventories of stocks, as: (a) (b) (c) Raw materials. Stores and spares. Work in process.

(d)Finished goods.

6.

Temporary investments of surplus funds.

7. Prepaid expenses. 8. Accrued incomes. In a narrow sense. The term working capital refers to the net working capital

Net W.C = current assets current liabilities

Net working capital may be positive or negative.

Constituents of current liabilities.

i. ii. iii. iv. v. vi. vii. Bills payable. Sundry creditors. Accrued or outstanding expenses. Shorts - term loans, advances and deposits. Dividends payable. Bank overdraft. Provision for taxation.

Gross working capital concept is financial or going concern concept whereas net working capital is an accounting concept of working capital.

These two concepts of working capital are not exclusive, rather both have

their own merits, the gross concept is sometimes preferred to the net concept of working capital for the following reasons: It enables the enterprise to provide e correct amount of working capital at the right time. Every management is more interested in the total current assets with which it has to operate than the sources from where it is made available. The gross concept takes into consideration the fact that every increase in the funds of the enterprise would increase its working capital. The net working capital concept, however is also important for the following reason: It is a qualitative concept which indicates the firm's ability to meet its operating expenses and short term liabilities. It indicates the margin of protection available to the short term creditors. It is and indicator of the financial soundness of an enterprise. It suggests the need for financing a part of the working capital requirements out of permanent sources of funds.

To conclude, it may be said that both, gross and net, concepts of working capital are important aspects of the working capital management. The net concept of working capital may be suitable only for proprietary form of organizations such as sole trader of

partnership firms. But the gross concept is very suitable to the company form of organization where there is a divorce between ownership, management and control.

NEED OF WORKING CAPITAL MANAGEMENT

For the efficient operation of the business, working capital is required along with the fixed capital, working capital is needed for the purchase of raw material and for the payment of various day to day expenses. There will be hardly any business, which does not require any working capital. The need of working capital is different in different business. Financial management aims at maximizing the wealth of shareholder. To achieve the objective, it is necessary to earn adequate profits. The profit depends largely on sales but sale dont result in to cash immediately. To increase sales goods are to be sold on credit, the collection of which takes place time term. Thus there exit a gap between the sales of

goods and realization of cash. During this period expenses incurred to continue business operations. For this purpose, working capital is requried. The need of working capital can be explained with the help of operating cycle or cash cycle. Operating cycle means that time period which is required to convert raw material in to cash. In manufacturing enterprise raw material purchased with cash, than raw material is converted into work-in-process, which is the term gets converted in to finished goods ; both receivable through sales and lastly cash is received from debtors and bill receivable.

In operating cycle following events are included:

1. Conversion of cash into raw material. 2. Conversion of raw material into work-in-process. 3. Conversion of work-in-process finished goods. 4. Conversion of finished goods in to debtors and bill receivable. 5. Conversion of debtors and bill receivable through sales in to cash.

DEBTORS AND BILL RECEIVABLE

CASH

FINISHED GOODS

RAW MATERIAL

WORK-INPROCESS

OPERATING CYCLE
The greater the period of operating cycle, more will be the requirement of working capital. Business enterprises engaged in manufacturing work have larger duration of operating cycle as compared to those engaged in trading business in such enterprise cash is directly converted in to finished goods. Because no business is able to match its cash flow and out flows, therefore the business needs to maintain some cash to pay its current liabilities in time. Similarly, to maintain supply of goods to meet the demand in the market, the stock of raw material has to

maintain. Firm has to sell on credit due to the competition. Thus, business needs adequate working capital.

CLASSIFICATION OR KINDS OF WORKING CAPITAL

Working capital may be classified in two ways: 1. 2. On the basis of concept. On the basis of time. On the basis of concept. Working capital is classified as gross working capital and net working capital as discussed earlier. This classification is important form the point of view of the financial manager. On the basis of time working capital may be classified as: 1. 2. Permanent or fixed working capital. Temporary or variable working capital.

Permanent or fixed working capital. Permanent or fixed

working Capital is the minimum amount which is required to ensure effective utilization of fixed facilities and for maintaining the circulation of current

Assets. There is always a minimum level of current assets which is continuously required by the enterprise to carry out its normal business operations for example. Every firm has to maintain a minimum level of raw material , work in process finished goods and cash balance .

This minimum level of current assets is called permanent or fixed working capital as this part of capital is permanently blocked in current assets. As the business grows, the requirements of permanent working capital also increase due to the increase in current assets. The permanent working capital required to ensure circulation of current assets from cash to inventories, from inventories to receivables and from receivables to cash and so on reserve working capital is the excess amount over the requirement for regular working capital which may be provided for contingencies that may arise at unstated periods such as strides rise in prices, depression, etc.

Temporary or variable working capital.

Temporary

or variable working capital is the amount of working capital which is required to meet the seasonal demands and some special exigencies. Variable working capital can be further

classified as seasonal working capital and special working capital. Most of the enterprises have to provide additional working capital. Special working capital is that pat of working capital which is required to meet special exigencies such as lunching of extensive marketing campaigns for conducting research, etc. the temporary working capital differs from permanent working capital in the sense that it is required for short periods and cannot be permanently employed gainfully in the business.

KIND OF WORKING CAPITAL

WORKING CAPITAL

ON THE BASIS OF CONCEPT

ON THE BASIS OF TIME

GROSS W.C

NET W.C

FIXED W.C

VARIABLE W.C

PERMANENT AND TEMPORARY WORKING CAPITAL IN SHORT RUN

AMOUNT OF WORKING CAPITAL (RS)

TEMPORARY

PERMANENT

TIME

PERMANENT AND TEMPORARY WORKING CAPITAL IN LONG RUN

AMOUNT OF WORKING CAPITAL (RS)

TEMPORARY

PERMANENT

TIME

FACTOR AFFECTING OF WORKING CAPITAL

Business should prepare its financial plan in such a way that it has neither surplus nor inadequate working capital. The need of every business are different but generally the factor must be considered while determining the requirement of working capital.
1.

Nature of the business.

2. Growth and expansion. 3. Production cycle. 4. Business fluctuations. 5. Production policy. 6. Credit policy. 7. Availability of raw material. 8. Availability of bank credit. 9. Turnover on inventories. 10. Magnitude of profit.

11. 12. 13. 14. 15.

Level of Texas. Dividend policy. Depreciation policy . Price level change. Operating efficiency.

IMPORTANCE OR ADVANTAGES OF ADEQUATE WORKING CAPITAL

Working capital is the life blood and nerve center of a business. Just as circulation of blood is essential in the human body for maintaining life, working capital is very essential to maintain the smooth running of a business. Business can run successfully without and adequate amount of working capital. The main advantages of maintaining adequate amount of working capital are as follows:
1.

Solvency of the business: helps in Maintaining solvency of the

Adequate working capital

business

by

providing

uninterrupted flow of production.

2.

Goodwill: sufficient working capital enables a business concern to make prompt payments and hence in creating and maintaining goodwill.

3.

Easy loans: A concern having adequate working capital, high solvency and good credit standing can arrange loans from banks and others on easy and favorable terms.

4.

Cash discounts: Adequate-working capital also enables concern to avail cash discounts on the purchases and hence it reduces costs.

5.

Regular supply of raw materials: Sufficient

working

capital ensures regular supply of raw materials and continuos production. Regular payment of salaries, wages and other day to day commitments: A company which has ample working capital can make regular payment of salaries, wages and other day to day commitments which wastage and costs and enhances production and profits.

6.

.Exploitation of favorable market conditions: Only

concerns with adequate working capital can exploit favorable market conditions such as purchasing its requirements in bulk when the prices lower and by holding its inventories for higher prides.

7.

Ability to crisis:

Adequate working enables a concern

to face business crisis in emergencies such as depression because during such periods, generally, there is much pressure on working capital. . 8. High morale : Adequacy of working capital creates an

environment of

Security, confidence, high morale and creates

overall efficiency in a business.

EXCESS OR INADEQUATE WORKING CAPITAL

Every business concern should have adequate working capital to run its business operations. It should have neither redundant or excess working capital position are bad for any business however out of the inadequacy of working capital which is more dangerous from the point of view of the firm.

Disadvantages of excessive working capital

1. Excessive working capital means idle funds which earn no profits for the business and hence the business cannot earn a proper rate of return on its investments. 2. When there is a redundant working capital, it may lead to unnecessary purchasing and accumulation of inventories causing more chances of theft, waste and losses. 3. Excessive working capital implies excessive debtor and defective credit policy which may cause higher incidence of bad debts. 4. 5. It may result into over all insufficiency in the organization. When there is excessive working capital, relations with banks and other financial institutions may not be

maintained. 6. Due to low rate of return on investment, the value of shares may also fall. 7. The redundant working capital gives rise to speculative transactions.

DISADVANTAGE OF INADEQUATE WORKING CAPITAL

1.

A concern, which has inadequate working capital, cannot pay its short-term liabilities in time. Thus, it will loss its reputation and shall not be able to get good credit facilities.

2. It cannot buy its requirements in bulk and cannot avail of discounts, etc. 3. It becomes difficult for the firm to exploit favorable market condition and undertake profitable projects due to lack of working capital. 4. The firm cannot pay day to day expenses of its operation and it creates inefficiencies, increases costs and reduces the profits of the business. 5. It becomes impossible to utilize efficiently the fixed assets due to non - availability of liquid funds. 6. The rate of return on investments also falls with the shortage of working capital.

LITERATU RE REVIEW

PERFORMAS FOR ESTIMATION OF WORKING CAPITAL REQUIREMENTS FOR TRADING CONCERN

STATEMENT FOR WORKING CAPITAL REQUIREMENTS
AMOUNT Rs. Current Assets: 1. Cash 2. Debtors or receivables (for..months sales) 3. 4. 5. Stocks(for.. months sales) Advance payments if any Others .. . .. .. . .. ..

Less: current liabilities: 1. Creditors (for ..months purchase) 2. Lag in payment of expenses (outstanding expenses, if any)

WORKING CAPITAL(C.A.-C.L) .
Add: provision/margin for contingencies Net working capital required.

STATEMENTS FOR WORKING CAPITAL REQUIREMENTS

AMOUNT Rs. Current Assets: 1. Stock of raw material (for..months of consumption) 2. Advance payment if any a. Raw materials b. Direct labour c. Overheads 3. Stocks of finished goods (for..months sales) a. Raw materials b. Labour c. Overheads 4. Sundry debtors (for. Months sales) a. Raw materials b. Labour c. Overheads 5. Payment in advance if any 6. Balance of cash 7. Any other (if any) Less: Current liabilities: 1. Creditors (for ..months purchase) 2. Lag in payment of expenses (outstanding expenses, if any) .. . .. .. .. . . .. ..

WORKING CAPITAL (C.A.-C.L) .

Add: provision/margin for contingencies Net working capital required.

SCHEDULE OF CHANGE IN WORKING CAPITAL

Particulars CURRENT ASSETS Inventories Sundry Debtors Cash & Bank Loan & Advances Total Assets(A) CURRENT LIABILITIES Acceptances Due to small scale Industries Other creditors Security Deposit Advance Receipt

Year 2003 312181368 176256 876 1231881 53602290 543272415 1437839 13330138

Year 2004 249232511 166547181 1176728 52926780 469919200 1064519 31946661 351553825 191870540 7771805 116083324 700290674 (230371474)

Effect on W.C Increase Decrease 373320 122954483 62948857 9709695 55153 639510 18616523 30293163 1683928 9240153

474508263 161577377 from 6087877 106843171 763784665 (220512250) 9859224 (230371474 )

customer Provision for gratuity Total of Current Liabilities (B) W.C. (A-B) Neg. decreases in W.C. Total

9859224 (230371474 ) 133186982 133186982

Particulars CURRENT ASSETS Inventories Sundry Debtors Cash & Bank Loan & Advances Total Assets(A) CURRENT LIABILITIES Acceptances Deferred payment

Year 2002 336074005 200989466 2249618 56318650 595631739 3404117 2533119

Year 2003 312181368 176256 876 1231881 53602290 543272415 1437839 13330138 474508263 161577377 6087877 106843171 763784665 (220512250)

Effect on W.C Increase Decrease 1966278 2533119 782817 19316577 150381837 4851003 2856323 23892637 247 32590 1017737 2716360 -

Liabilities under redis. Due to small scale 14112955 Industries Other creditors Security Deposit Advance Receipt 493824840 11195540 from 1236874 103986848 630294293 (34662554) (185849696) (220512250 )

customer Provision for gratuity Total of Current Liabilities (B) W.C. (A-B) Neg. Decrease in W.C. Total

185849696 (220512250) 210448487 210448487

Particulars CURRENT ASSETS Inventories Sundry Debtors Cash & Bank Loan & Advances Total Assets(A) CURRENT LIABILITIES Acceptances Due to subsidiary Co. Deferred payment

Year 2001 362672305 282410719 1344047 65326757 711753828 6432112 4381456 7913800

Year 2002 336074005 200989466 2249618 56318650 595631739 3404117 2533119 14112955 493824840 11195540 1236874 103986848 630294293 (34662554) 111550450

Effect on W.C Increase Decrease 905571 3027995 4381456 5380681 3725823 317860 26598300 81421253 9008107 523722 3614221 6874703 1249530 -

Liabilities under redis. Due to small scale 13589233 Industries Other creditors Security Deposit Advance Receipt 490210619 4320837 from 4962697 102737318 317860 634865932 76887896

customer Provision for gratuity Int. on loan accrued but not due Total of Current Liabilities (B) W.C. (A-B) Decrease in W.C. Total

111550450 129289836 129289836

76887896

76887896

COMMENTS: The above schedule of change in working capital depicts :1. Current Liability & provision increase by 1.5

Crore due to better bargaining with vendors and having more credit period facilities as compared to last year. 2. Debtors decrease by 0.97 Crore due to debtors

realization . 3. Cash and bank balance decrease on the basis of

current requirement. 4. Inventory decrease by 6 crore due to decrease in

finished stock and unfinished stock by 4 crore which offset by increase in tools and spares by 2 crore.

RESEARCH METHODOLOGY

METHODOLOGY
SOURCE: It was decided that necessary information for the study could be obtained from the staff level and concerned officers of the finance department .

INSTRUMENT: Major instrument for acquiring the information was a catalogue of the company and discussion to concerned officers.

FIELD WORK: The collection of data was during the period of 02-06-2005 to 13-07-2005 very well cooperation was given by the employees working in the industry.

OBJECTIVES OF THE STUDY

As BLOOD is essential for human body to live, the same way FINANCE is essential for organization to survive. Thus to maintain proper use of finance in an organization finance department is required. The finance department is the major department in an organization as it is concerned with the procurement and efficient utilization of funds in order to maximize profit and reduce cost of production. Finance department is not only concerned with their day - to day activities but they also give more attention to the area where funds are indirectly

Present study is conducted to achieve the following specific objectives:-

1. To know the functioning of the finance department of BILT. 2. To analyze the liquidity position of the organization. 3. To examine profitability position of the management.

4. To

find

out

the

weaknesses

and

to

suggest

various

suggestions. 5. To study the performance of BILT. 6. To know about certain innovations made in the organization as compared to past. 7. To prepare report on study thus conducted blocked .

Research Methodology For The Report

RESEARCH DESIGN I have used Descriptive Research as a tool to study labour welfare measures of workers.

Descriptive research

studies are those studies, which are concerned with specific

predictions, with narration of facts and characteristics concerning individual, group or situation.

Scope of Study
This study is made to know the best of labour welfare activities so that it can be implemented for better efficiency and better achievement. The research studies the

RELEVANCE OF LABOUR WELFARE. It also attempts to analyze the views and attitudes of workers on various labour welfare measures for workers.

Area Of Study
The units selected for the purpose of study is M/s. Ballarpur Industries Limited, Unit Shree Gopal, Yamuna Nagar and

deals with respect to labour welfare measures being implemented in the mentioned organization. DATA COLLECTION The task of data collection begins after a research problem is being defined and research design chalked out. Data types a) b) Primary Sources Secondary Sources

A . Primary Sources : The primary data are those which are collects fresh and for the first time, and thus happen to be original in character. B . Secondary Sources : The secondary data are those which have already been collected by someone and which have already been passed through the statistical process. Collection Of Data For Project

PRIMARY SOURCE Personal Interviews, Questionnaires, Observation SECONDARY SOURCE Books, Journals, Magazines, Newspaper, Reports, Internet.

In order to collect the information for the research study I used the questionnaire which had both open-ended and closeended questions. The questionnaire was filled by the investigator herself because most of the workers were not able to go through the questionnaire. The questions were explained to them in Hindi and the replies were sought. So filling-up of the questionnaire was followed DATA ANALYSIS After the data collection, various parameters have been used for the purpose of data analysis & the information collected has been presented in different tables & on the basis of these tables analysis & interpretation has been made & the same has been presented in the form of Bar Diagrams, Doughnuts SAMPLING DESIGN A sample design is a definite plan for obtaining a sample from a given population. There are many sample design from which a researcher can choose. Researchers must prepare /select a sample design which should be reliable and appropriate for their research only. & Pie-Diagrams, with the brief interview with the worker

D.

SAMPLING UNIT
The first step in developing any sample design is to clearly define the set of objectives technically called universe to be studied. The universe of my study includes the corporate houses whether big or small. These are the organization which are indulged in providing welfare amenities to labour for their betterment thereby improving the lot of working class & make a worker a good employee and a good citizen.

Sample Size
This refers to the organizations surveyed. Although large samples are more reliable but due to shortage of time and money this organization has been selected. Sample Size Type Of Question Instrument Used Interviews Area covered Type Of Universe : : Yamuna Nagar Finite : : : 50 Close-ended & Open-ended Questionnaire, Personal

Sampling Techniques
This refers to procedure by which the organizations have been chosen. This is : Non-Random Sampling : Convenience Sampling Judgement Sampling

LIMITATION OF THE STUDY

The major limitations of my study are as under: -

1. LIMITED TIME: -Although Industries LTD, was

the very

staff

of

BALLARPUR and highly

A.M. MR. JOYDEEP BANARJEE

efficient

cooperative and they devoted enough of their valuable time on us but because of time constraint we were not able to devote as much time with their employees.

2.

SECRECY: -

Some

of

the

information

was

kept

confidential and was not disclosed to any person whosoever.

3.

LACK OF COMPARATIVE DATA:- Due

to

non-

availability of other industries in the paper market we were not able to compare the data of one organization with another.

Inspite of these difficulties we still put our best efforts in try to do the full justice to the subject matter and in completion of the report.

INDUSTRY PROFILE

Structure of Finance Department

MANAGER OPF FINANCE Mr. Rakesh Chawla

Dy. MANAGER OPF FINANCE Mr. Sandeep Mittal

A.M. MR.S.L. ARORA (FIXED ASSETS, CASH)

A.M. MR.R.K. THAKRAL (BILLS PAYABLE)

A.M. MR. N. AHUJA (B/R)

D.M. MR.ASHOK CHOPRA (SALES TAX)

A.M. MR. JOYDEEP BANARJEE

OFFICE/EXECUTIVES

STAFF

BOARD OF DIRECTORS
MR. L.M. THAPAR (Chairman) MR. GAUTAM THAPAR (Vice-Chairman & Managing Director) MR. R.R. VEDERAH (Deputy Managing Director) MR. B. HARIHARAN (Group Director Finance) MRS. NEERJA SHARMA (General Manager & Company Secretary) OTHER DIRECTORS OF GOPAL) THE COMPANY MR. R.K. AHOOJA PATIALA MR. SUBIR BISHT DR. RAM . S. TARNEJA BANK DR. CHERIF SEDKY MR. SHARDUL . S. SHORFF MR. SANJAY LABROO ALLAHABAD BANK INDIAN OVERSEAS PUNJAB NATIONAL BANK STATE BANK OF BANKERS (UNIT SHREE

(Maharashtra)

REGISTERED OFFICE P.O. Ballarpur Paper Mills Distt. Chandrapur

AUDITORS K.K. Mankeshwar & Co. Janpath (C.A.) New Delhi Price Water House (C.A.) New Delhi Road

HEAD OFFICE Thapar House 124, New Delhi OPERATING OFFICE First India Place Tower C Mehrauli Gurgaon Gurgaon(Haryana)

COMPANY PROFILE

OTHER BUSINESS : Leather Toscana Shoes (Noida- Banglore). Construction material- ALL (Haryana). Media The Pioneer Limited (Lucknow & Delhi). BILT has a turn over of 15000 crores (2001-2002) and an annual growth rate of 30 percent. It contributes to 3/5 th of countries

values added and speciality papers and accounts for 20% of the countries over all paper production. 45% of coated papers 90% of the industrial paper laminates and 95% of back centered boards produced in India are accounted by BILT. BILT started with Shree Gopal Paper Mill in Yamuna Nagar in thirties. Later it over took Ballarpur paper and Straw Boards They both in 1945 were merged to

mills in Chanderpur Distt.

form Ballarpur Industries Limited. Special varieties of paper for everyday use like Sunlit bond paper which is must for a presentable writing are made in BILT. The Sunlit cartridge and Sunshine, super fine cartridge are highly

valued drawl The precious educational certificates are made on BILT's Super Lucky Ivory Bonds. Life Insurance policies and

railway tickets are printed on BILT's Red Fort Policy Bond and Lucky Parachement papers.

BILT is the sole makers of certain types of surface papers for high speed quality printing. They are the only manufacturers of Premium personal letter head or the top corporate executives. BILT is heading towards fast development globalization of paper industry.

CORE VALUE

HONESTY : We will be principled , straight-forward and fair in all our dealing.

INTEGREITY: We will maintain the highest standards of professionalism.

FLEXIBILITY: We will adopt our selves to always stay a step ahead of change.

RESPECT FOR INDIVIDUALS: We will give each person room to contribute and grow.

RESPECT FOR KNOWLEDGE: We shall

acquire and

apply

leading edge expresses in all aspects of our business.

TEAM PERFORMANCE: The team comes first none of us is as good as all of us.

VISION
Our aspiration is to become a leading creator of shareholder value in the paper industry. To achieve this, we will use the ENERGY of our people, develop and implement LEADING EDGE technologies and draw on both to deliver EFFECTIVE world class solutions to our customers. As per the leading company in Thapar Groups: Maximize shareholders value by the speed and quality of their response to market forces and business opportunities. Be market leader in their core business. Achieve and sustain global competitiveness in all their business.

 Be the preferred supplier by providing their customer products and Service that always exceeds their requirements. Grow as institution of strength of their people. Be industry leaders in their commitment to safety and the environment.

MISSION
To consistently out perform expectations and deliver superior value to both our customers and stakeholders. To achieve this, we will ENERGISE our people with a positive culture that rewards INNOVATION, breeds INITIAIVE and

encourages INTELLIGENT risk taking.

SWOT ANALYSIS
STRENGTHS:
Maximum variety of paper and high quality.

 New pulp mill. Good employer - employee relationship.

Efficient management. Totally computerized. Team building.

Fulfilling social responsibility by keeping environment clean.

OPPORTUNITIES: BILT have technology tie - up with world class popular companies. BILT has 25% share in paper in India. BILT has reached in Growth Stage.

WEAKNESS:
Shortage of funds. Unnecessary blockage of funds.

Flow of funds controlled by head office.

THREATS:
Imported paper. Government policies. Increasing competition.

SUGGESTION
Total liabilities of outsiders should be decreased.

Net profits need to be improved.

As capital has risen, so sales should also be improved upon to achieve success.

Current liabilities are to be decreased.

Current assets are to be increased for the proper and smooth functioning of business

Over all Management should be improved.

Expenditure should be decreased.

CONCLUSION

"Success is achieved by those who try where there is nothing to loose by trying and a great deal to gain if successful, by all means try "
-W. Clement Stone

The study has its own importance in its own way. With the help of this study one can know about the struggle and success of BILT. Efforts, which is due to its efficient management This study will definitely increase the morale of each employee and by studying this, managers come to know that what effective measures can be taken to maintain the

effective use of working capital in the organization and thus to achieve goals of the organization

BIBLIOGRAPAHY

Web site:www.bilt.com www.indiainformation.com/com./boll/di00/limit

Text Book:ADVANCED ACCOUNTANCY FINANCIAL ACCOUNTANCY FINANCIAL ACCOUNTANCY -SHASHI K. GUPTA -M.Y. KHAN - I.M. PANDEY