SUMMER INTERNSHIP 2011 - 2012

Amity Business School, Amity University, Lucknow Campus

STUDY OF WORKING CAPITAL MANAGEMENT

HCL INFOSYSTEMS LIMITED
Project Guide(s) 1. Mr. Jai Thomas 2. Prof. Manoj Joshi
By: Aishwarya Srivastava B.Com.(Hons.)-III 2010-13
Amity Business School, Amity University, Lucknow Campus

Objectives
1.

The main purpose of this study is to render a better understanding of the concept Working Capital Management.

2.

To understand the planning and management of working capital at HCL Infosystems Ltd.

3.

To measure the financial stability of the company by analyzing various ratios.

Amity Business School, Amity University, Lucknow Campus

Research Methodology
1.

To have a clear idea of what is working capital, how it is

managed in HCL Infosystems, what are the different ways

in which the financing of working capital is done in the company.
2.

Secondary sources like previous years annual reports,

reports on working capital for research, analysis and comparison of the data gathered.

Amity Business School, Amity University, Lucknow Campus

Findings
1. 2.

The debts doubtful have been doubled over the years. The returns have been affected by a marked growth in working capital and though a 29.75% in 2006 return on investment is good, but it got reduced as compared to 39.01% return in 2005.

3.

Ratios calculated indicate that the profitability of the firm and sales are on a rise.

4.

Inefficiencies in the working capital management have been deleted over the years.

Amity Business School, Amity University, Lucknow Campus

Limitations
1.

We cannot do comparisons with other companies unless and until we have the data of other companies on the same subject.

2.

Only the printed data about the company was available and not the backend details.

3.

Future plans of the company were not disclosed to the trainees.

Amity Business School, Amity University, Lucknow Campus

Conclusions
1.

The working capital position of the company is sound and the various sources through which it is funded are optimal.

2.

The firm has not compromised on profitability despite the high liquidity is commendable.

3.

HCL Infosystems has reached a position where the default costs are as low as negligible and where they can readily factor their accounts receivables for availing finance is noteworthy.

Amity Business School, Amity University, Lucknow Campus

Recommendations
The business runs successfully with adequate amount of the working capital but the company should see to it that the cash should not be tied up in excessive amount of working capital. 2. The over purchasing function should be avoided as it could lead to liquidity problems. 3. The investment of cash in marketable securities should be increased, as it is very profitable for the company. 4. Holding of excessive and insufficient stock must be avoided as it creates a burden on the cash resources of a business and results in lost sales, delays for customers, etc respectively.
1.

Amity Business School, Amity University, Lucknow Campus

THANK YOU

Amity Business School, Amity University, Lucknow Campus