SUMMER TRAINING REPORT SUBMITTED TOWARDS THE PARTIAL FULFILLMENT OF POST GRADUATE DEGREE IN INTERNATIONAL BUSINESS

ANALYSIS OF WORKING CAPITAL FOR DHARAMPAL SATYAPAL LTD. SUBMITTED TO Ankit Goel ROLL NO. C-07 SUBMITTED BY MBA-IB Col. Mohan

AMITY INTERNATIONAL BUSINESS SCHOOL, NOIDA AMITY UNIVERSITY UTTAR PRADESH COMPANY CERTIFICATE TO WHOM IT MAY CONCERN This is to certify that Ankit Goel , a student of Amity International Business School, Noida, undertook a project on Working Capital Analysis at Dharampal Satyapal Ltd. from 1st May09 to 30th June09 . Mr. Ankit Goel has successfully completed the project under the guidance of Mr. Neeraj Goel. He is a sincere and hard-working student with pleasant manners. We wish all success in his future endeavors. Signature with date (Name) (Designation) (Company Name)

CERTIFICATE OF ORIGIN This is to certify that Mr. Ankit Goel, a student of Post Graduate Degree in MBA-IB (2008-2010), Amity International Business School, Noida has worked in the Dharampal Satyapal Ltd. under the able guidance and supervision of Mr.Neeraj Goel, (Manager finance), Company Birla Power Ltd. The period for which he was on training was for 8 weeks, starting from 1st

May09 to 30th June09

. This Summer Internship report has the requisite standard for the partial fulfillment the Post Graduate Degree in International Business. To the best of our, knowledge no part of this report has been reproduced from any other report and the contents are based on original research.

Signature ( FACULTY GUIDE )

Signature ( Student )

ACKNOWLEDGEMENT I express my sincere gratitude to my industry guide Mr.Neeraj Goel, (Manager Finance), (Company) Birla Power Ltd, for his able guidance, continuous support and cooperation throughout my project, without which the present work would not have been possible. I would also like to thank the entire team of Dharamal Satyapal Ltd, for the constant support and help in the successful completion of my project. Also, I am thankful to my faculty guide Col.Mohan of my institute, for his continued guidance and invaluable encouragement. Signatur (Student) TABLE OF CONTENTS

CHAPTER NO. CH.-1.0 2.1Primary Objectives 2.2Methodology 2.3Schedule 2.4Scope of study 2.5Limitations Ch.-3. Company Profile 3.1Industry Profile

SUBJECT Executive Summary Ch.-2.0 Research Methodology

Ch.-4.0Evaluation of financial position 4.1comparative studies

Ch.-5.0 Critical Review of Literature Ch.-6.0 Findings & Analysis & Observations Ch.7.0Recommendations Ch.-8.0Bibliography Ch.-9.0 Annexture 9.1Tables Ch.-10.0 Case Study Ch.-11.0 Sypnosis of project EXECUTIVE SUMMARY

The management of current assets deals with determination, maintenance, control and monitoring the level of all the individual current assets. Current assets are referred to as assets, which can normally be converted into cash within one year therefore investment in current assets should be just adequate no more no less to the needs of the business. Excessive investments in current assets should be avoided, because it impairs firms profitability, as idle investment in current assets and are non-productive and so they can earn nothing, on the other hand inadequate amount of working capital can threaten solvency of the firm, if it fails to meet its current obligations. Thus the working capital is a qualitative concept 1.It indicates the liquidity position of the firm and 2.It suggests the extent to which working capital needs may be financed by permanent source of fund. Current assets should be sufficiently in excess of current liabilities to constitute a margin or buffer for maturing obligation within the ordinary cycle of business. The basic learning objective behind the study was Computation of Working Capital Management Operating Cycle of the firm Financial plan estimated for 2007-2008 and projected for 2008-2009 Working capital credit limits Ratio analysis On the basis of above calculations following conclusions can be made- Birla power ltd. has both long term as well as short term sources for current asset financing. It implies that company follows matching principle for raising funds. Right now company is following aggressive policy, which means that company is maintaining lower ratio of current assets to fixed assets. Birla power solutions ltd has high collection peri0od which shows that money has been unnecessarily blocked with the debtors. So to overcome the above problems following are the recommendations Increase the proportion of current assets over fixed assets to come to proper proportion of current assets and fixed assets as per the basic norms and guidelines. Company should shift from aggressive policy to conservative current assets policy. Company should reduce the holiday period else the company will have to pay high carrying cost.

RESEARCH METHODOLOGY PROJECT OBJECTIVE The project is aimed at evaluating the financial status of Dharampal Satyapal Ltd and then doing the comparative analysis with its competitors Studying the working capital management at Dharampal Satyapal Ltd. and estimating the working capital requirements for 2007-2008 and then forecasting for 2008-2009 To find out if there is any relationship between the working capital, sales and current assets of Birla Power METHODOLOGY The methodology to be adopted for the project is explained as under: 1.The initial step of the project was studying about the company and then evaluating the financial position of the company on the basis of ratio analysis. 2.Comparing the firms financial position with respect to its competitors i.e. Hindustan Unilever Ltd., ITC and Kothari Products with the help of following ratiosLiquidity ratios Solvency/Leveraging ratios Coverage ratios Activity/turnover ratios Profitability ratios Investors ratios , 3.The project will focus on the study of overall working capital management at the organizations, for which the following study and analysis will be undertaken: i)This project is aimed to estimate the operating plan for the year 2007-2008 ii ) This will also include the calculations and analysis of the operating cycle for the company. Iii ) Study of C M A form and to prepare for the current year. Iv) It will also include the ratio analysis of the financial statement so that the profitability and liquidity trade off can be analyzed.

SCHEDULE The complete project will be for duration of 8 weeks. The project has been divided into 2 stages with approximate time period allotted to each stage. Both the stages along with their approximate timelines are as follows: STAGE 1 (APPROX 2 WEEKS) The study of companys financial position by doing ratio analysis of the financial statement so that the profitability and liquidity condition of the organization can be studied closely and then comparing it with the financial statements of Coleman Cable Inc, Beacon Power Corp, Powell Industries. STAGE 2 (APPROX 6 WEEKS) The study of the overall working capital management of the company will be the first stage. Under this stage the operating plan will be prepared and the study and analysis of the C M A form will be done. This will include the estimation of working capital requirement for 2007-2008, forecasting for 2008-2009 and regression analysis and T test for finding out the relationship between working capital, sales and current assets. SCOPE OF THE STUDY Studying working capital management of the Birla Power ltd and benchmarking it with 3 of its competitors. LIMITATIONS In spite of my continued efforts to make the project as accurate and wide in scope as possible, certain limitations are becoming evident while implementing the project. These limitations cannot be removed and have to be accepted as permanent constraints in implementing the project. Some limitations, which have been identified, by me are: 1.Generalizations and calculated assumptions had to be made in some areas while analyzing the financial statements, ratios etc. due to non-availability of complete information. 2.The segment wise and product wise study of the various product segments and units of the company have been excluded from the scope of the project due to data and time constraints.

COMPANY PROFILE Dharampal Satyapal Group (DS Group) is more than Rs. 1400 crores diversified conglomerate, which is committed towards high quality products & credited with several innovations over last seven decades. The sagacity to weave its business around consumer needs has conferred DS Group with a distinct value. Efficient capital structure, cutting edge technology, operational discipline and a widespread distribution network, have together attributed to enhance Brand DS, and enabled the organization to deliver continued growth in all areas of operation. Its undeterred pursuit for Quality & Innovation has led the Company to progress on a path of growth. The Group has consolidated its position into diversified sectors like FMCG, Packaging, Hospitality, Rubber thread, Cement and other businesses. Beginning its journey with Tobacco, DS Group successfully ventured into the arena of Foods & Beverages, alluring the consumers with a wide range of beverages, spices, and ready-to-eat snacks under the brand Catch. While Catch Natural Spring Water and its variants continue getting great response from consumers, Catch Salt & Pepper tabletop dispensers hold their supremacy as Indias first rotatory table top dispensers. Catch Spices excessively continues to be connoisseurs favorites. The latest products to be introduced under catch brand are Catch Jal Jeera & Catch Nibu Pani. In the Mouth Freshener Category, non-tobacco, Rajnigandha rules the market as the worlds largest selling premium pan masala. Pass Pass has created a new product category all-together as Indias first ever branded all natural non supari assorted mouth freshener. Taking forward the Indian tradition of eating and serving mouth fresheners after meals, Rajnigandha, the premium mouth freshener brand, has introduced a mild new flavour, Meetha Mazaa - the Indian Mouth freshener. Reinforcing the emphasis on the quality at all levels, Meetha Mazaa is revitalizing. Recognizing the immense potential in the Hospitality Segment, DS Group forayed into this segment with The Manu Maharani at Nainital, in 2001. The Group acquired the Airport Hotel at Kolkata. The hotel is currently being revamped and renovated and will soon emerge as an International standard destination with Five Star Hotel, a budget hotel & large Convention Centre, in addition to a sprawling Commercial area. The five star hotel building projects have also commenced in Guwahati and Jaipur. In addition to the above ventures, land has been acquired in cities like Udaipur, Shimla, Mussorie, Corbett Park, Manali and Goa with plans to set up hotels & resorts. With a boom in tourism sector, the group is all set to emerge as one of the leading players in the hospitality segment. Further pursuing its quest for diversification, DS Group has launched colossal projects in the Packaging sector. DS Canpac Ltd., an eco friendly revolutionary packaging technology, was launched in India in association with Canpac a leading Switzerland based packaging major. A state-of-the-art plant at Noida offers packaging solutions to other FMCG marketers as well as exporters of food products. The group has also commissioned an ultra modern Flexible Packaging Unit in Bonda. A heat resistant latex Rubber thread plant has been set up at Agartala to produce international quality rubber threads. Latex rubber threads are made from natural rubber applying the most sophisticated European technology. Following close behind is a first-of-its kind Steel sheets plant coming up soon in the North East to produ cold rolle sheets, CRCA and galvanized steel sheets. In line with its vision of diversification, DS Group has entered the fast growing

Cement Industry. The Project is located at the Khliehriat sub division of District Jaintia Hills in Meghalaya. The capacity of the upcoming plant will be approximately 1 million tons Per Annum and will have a captive power plant based on coal. This will be one of the largest investments on new projects, by the Group. As a significant step in Infrastructure Sector, DS Group has signed a MOA with state Govt. of Meghalaya to set up a 240 MW Thermal Power Plant, based on coal. The group has manufacturing units in Noida, Delhi, Baroitwala in HP, Kullu, Assam and Tripura. DS Group boasts of World Class Facilities spread across the length and breadth of the country, to execute its manufacturing processes with full adherence to international standards of quality. Every stage of manufacturing is monitored with utmost care and attention.