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At
Indian Rayon
(A unit of Grasim Industry Limited)
On
“Descriptive Analysis of Share Capital “
Submitted To:
Submitted By
SONIKA K. AHUJA
(168170592001)
MBA SEM: III
Index
SR. NO. PARTICULAR
1. FOUNDER OF ADITYA BIRLA NUVO LIMITED
2. INTRODUCTION OF COMPANY
6. DEPARTMENT OVERVIEW
8. TYPES OF SHARE
17. FINDINGS
18. SUGGESTION
19. LIMTATIONS
20. CONCULATION
21. BIBLIOGRAPHY
FOUNDER OF ADITYA BIRLA NUVO LIMITED
Aditya Vikram Birla (14 November 1943 – 1
October 1995), was an Indian industrialist.
Born into one of the largest business families
of India, Birla oversaw the diversification of his
group into textile, petrochemicals and
telecommunications.
Insulators: -
Insulators are used in power generation, transmission
and distribution. Global clientele of Aditya Birla
Insulators includes ABB, Areva, Siemens, leading power
utilities, Power Grid Corporation of India etc.
VISION – MISSION – VALUES
Integrity:
We define Integrity as honesty in every action. We shall act and take decisions in a manner that these are fair, honest and
follow the highest standards of professionalism. ‘Integrity’ shall be the cornerstone for all our dealings, be it with our
customers, our employees, suppliers, our partners, shareholders, the communities we serve or the government.
Commitment:
On the foundation of Integrity, we see Commitment as doing whatever it takes to deliver as promised. Each one of us shall
take ownership for our own work, teams and the part of the organization we are responsible for. Through this value we shall
build an even sharper results oriented culture that is high on reliability and accountability. Our commitment is likely to make
us a formidable leader and competitor in every market that we are in.
Passion:-
We define Passion as a missionary zeal arising out of an emotional engagement with work, which inspires each one to
give his or her best. All of us are expected to be energetic and enthusiastic in the pursuit of our goals and objectives. We
shall recruit and actively encourage employees with a ‘Fire in the belly’. With this Value, we hope to build a culture of
innovation and break-through thinking leading to superior customer satisfaction and value creation.
Seamlessness:
We understand Seamlessness as thinking and working together across functions, hierarchy levels, across business lines
and geographies. Each one of us shall demonstrate high level of teamwork through sharing and collaborative efforts and
garner the synergy benefits from working together. Before we can truly benefit from a borderless world, we need to build
a borderless organization. We visualize free flow of knowledge and information across the Company .
Speed:
We look upon Speed as responding to internal and external customers with a sense of urgency. We shall continuously
seek to crash timelines and ensure expeditious completion of our tasks. Through this Value we hope to build an agile and
proactive organization that is prompt to respond to the present and future needs of our customers. All these Values
together form our core ideology. They are all equally important and no Value will take precedence at the cost of the
other.
Corporate social responsibility policy
In accordance with the notification issued by the Ministry of Corporate Affairs’ dated 27th February 2014 under Section 135 of the Companies
Act 2013, the Company’s Corporate Social Responsibility (CSR) is enunciated.
The Company CSR policy was outlined in 2010 in the Companies’ Annual Reports and on its website.
In Education, our endeavor is to spark the desire for learning and knowledge at every stage through.
Formal schools
Balwadis
Quality elementary education
Aditya Bal Vidya Mandirs
Girl child education
Non-formal education
Adult education programmes
In Health care, our goal is to render quality health care facilities to people living in the villages and elsewhere through our
Hospitals.
Primary health care centres
Mother and Child care projects
Immunization programmes with a thrust on polio eradication
Programmes to address malnutrition.
Anganwadi
Adolescent health
Department overview
There are four department in Aditya Birla Nuvo Limited which
are as flows: -
Production Department
Marketing Department
Human Resource Management
Finances Department
Share Capital
Of
Aditya Birla Nuvo Limited
Share Capital
• Share capital consists of all funds raised by a company in exchange for
shares of either common or preferences Share of stock. The amount of
share capital or equity financing company has can change over time.
• A company that wishes to raise more equity can obtain authorization to
issue and sell additional shares, thereby increasing its share capital.
• A company's share capital is the money that shareholders invest to start
or expand the business.
• Share capital is the money invested in a company by the shareholders.
• Share capital is a long-term source of finance .In return for their
investment, shareholders gain a share of the ownership of the company.
Share Capital of Aditya Birla Nuvo Ltd.
• Aditya Birla Nuvo Ltd. have authorization of Equity Share Capital and
Preferences Share Capital.
• From year 2014 Aditya Birla is only issuing equity share capital.
• The company have issued fully convert able/ non-convertible debentures
at varies time
• Th major part of the capital includes Fully convertible debentures GDR
(Global Deposit receipts) and debentures.
• Our capital being reduces at the time of merger/ demerger
• At the time of merger/demerger some part of our capital being transfer to
demergered company and that company issue shares to our shareholders
so that our shareholder should get benefits.
• Major part of the capital was reduces in the year1990 at the time of
demerger of cement business and there after merger of garment business
and now in the year 2017 at the time of fully merger of the company in
Grasim Industries Ltd.
Types of Share
PREFERENCES SHARE CAPITAL
• Preference shares allow an investor to own a stake at the issuing company with a condition that whenever the company
decides to pay dividends, the holders of the preference shares will be the first to be paid.
• Dividend payment of the preference shareholders is fixed and if somehow company liquefies, the owners of the
preference shares will be the first one to get their money back after the company has paid back its debt.
• The capital of a company is divided into shares. Each share forms a unit of
ownership of a company and is offered for sale so as to raise capital for
the company.
• Equity shares give their holders the power to share the earnings/profits
in the company as well as a vote in the AGMs of the company. Such a
shareholder has to share the profits and also bear the losses incurred by
the company.
• Equity shares are the main source of finance of a firm. It is issued to the
general public. Equity shareholders do not enjoy any preferential rights
with regard to repayment of capital and dividend. They are entitled to
residual income of the company, but they enjoy the right to control the
affairs of the business and all the shareholders collectively are the
owners of the company.
Types of Equity Share Capital
Subscribed Capital
Paid-up Capital
Reserve Capital
Share Capital of Aditya Birla Nuvo Ltd.
Rs in Crores
Share Capital Numbers 31st March 31st March
2016 2015
Reconciliation of the number of shares outstanding at the beginning and at the end of the period
4 No. of Shares outstanding at the end of the period 130,222,858 `___ 130,137,193 __
Equity Shares in the Company held by each shareholder
holding more than 5 per cent shares and the number of
equity shares held areas under:
Sr. Name of Share Holders As at 31st March,2016 As at 31st March,2015
No.
1 IGH Holdings Private Limited 16,352,102 12.56% 16,352,102 12.57%
2 TGS Investment and Trade Private Limited 14,671,037 11.27% 13,506,736 10.38%
4 Trapti Trading & Investments Private Limited 9,423,935 7.24% 9,423,935 7.24%
6 Turquoise Investments and Finance Private Limited 6,885,421 5.29% 6,441,092 4.95%
Year Date Of Allotment No.Of equity Shares Face Value Of Premium Amount Total
Equity Shares (in per Equity Shares
Amount (Rs in
Rs) (in Rs)
Cores)
1 17.11.2015 100,00,000 10 116 126.00
2 29.12.2015 40,00,000 10 116 50.40
3 09.02.2016 80,00,000 10 116 100.80
4 24.02.2016 70,00,000 10 116 88.20
5 03.03.2016 80,00,000 10 116 100.80
6 29.03.2016 187,50,000 10 116 236.25
Total 557,50.000 702.45
BENEFITS TO SHAREHOLDERS
The Board will consider various internal and external factors, including but not
limited to the following before making any recommendation for dividends:
Stability of earnings
Cash flow from operations
Future capital expenditure, inorganic growth plans and reinvestment opportunities
Industry outlook and stage of business cycle for underlying businesses
Leverage profile and capital adequacy metrics
Overall economic / regulatory environment
Contingent liabilities
Past dividend trends
Buyback of shares or any such alternate profit distribution measure
Any other contingency plans
Bonus Share
1 1982 20
2 1983 28
3 1987 40
4 1994 190/160
5 2006 793
SERVICES TO SHAREHOLDERS
Transfer of Share
Deletion of Name
Transmission of Shares
Payment of Dividend
Change of Address
Dement of Shares
Employee Stock Option - ESO
An employee stock option (ESO) is a stock option granted to specified employees of a
company. ESOs offer the options holder the right to buy a certain amount of company shares
at a predetermined price for a specific period of time. An employee stock option is slightly
different from an exchange-traded option, because it is not traded between investors on an
exchange.
SWOT Analysis
STRENGTH
• Yarn produce here is of quality then also management analyse tries to increase the quality of yarn to fulfil
their potential customer and new ones.
• Better pacing, carriage and transportation system with all modern equipment and good system.
• Division also have continuous spanning yarn department in which the modern technology is used for the
spinning the yarn and its adopted for Germany.
• ISO 9002 for the better quality of production carries division.
WEAKNESS
• Cost of production is more due to existence of very old technology installed in this division.
• Many process step and process is more sensitive to normal process variation.
• Division is unable to pay more attention toward proper human recourse management.
OPPORTUNITY
• Division should find new market is for its products specially chemicals.
• More research activity should be done, as there is chance of finding new market.
• VFY use for certain textile items is specific and indispensable
• Enhance colour quality yarn
• Improvement in intrinsic quality of yarn and development of speciality yarn
THREAT
• Government policies are the main hurdles of the division’s performance.
• Emergence of cotton threads made the market share of rayon yarn low.
• Unregulated dumping of the product from china at lower cost has reduced the market share.
• The main raw material is wood pulp and due to strict rule by various government for forest cutting has
made raw material costly and in shortage.
Literature Review
• Doron Nissim and Stephen H. Penman (2001), this research work envisages on Financial
Statement analysis and identifies that this analysis has traditionally been seen as part of
the Fundamental analysis required for equity valuation. This paper outlines a financial
statement analysis for use in equity valuation.
• Sanjay Sehgal and Meenakshi Gupta (2005) presents the survey which aims at providing
insights about the way technical traders operate in the financial market and the trading
strategies that they adopt. The survey covered institutional and individual technical
traders with a long and active trading record for the Indian market. In this study, also it is
observed that the sample respondents tend to use Technical analysis along with
Fundamental analysis for security selection.
• Thomas Oberlechner (2001) presents the findings of a questionnaire and an interview
survey on the perceived importance of Technical and Fundamental analysis among
foreign exchange traders and financial journalists in Frankfurt, London, Vienna and
Zurich. Foreign Exchange traders confirm that, out of both the forecasting approaches,
technical analysis is more prominent than the other.
RESEARCH OBJECTIVES
The project is an attempt to seek an insight into the aspects that are involved
in the Share capital and financial decisions of the Company. This project
endeavors to achieve the following objectives.
• To study the Share capital of ADITYA BIRLA NUVO LIMITED through EBIT-EPS
analysis.
• To understand the means of financing for short term and long term financial
needs of the company.
• Infusion of funds by the promoter to strengthen the Balance Sheet and reduce
the Debt.
• Examining the financing trends in the ADITYA BIRLA NUVO LIMITED for the
period of 2012-16.
• Study effect of financing decision on EPS and EBIT of the firm.
RESEARCH METHODOLOGY
Data related to Aditya Birla Nuvo Limited has been collected through the Investor Service Centre and Accounts
department of the division.
SECONDARY SOURCES:
• Published Annual Reports of the Company for the year 2012-2016.
PRIMARY SOURCES:
• Detailed discussions and guidance from R. C. Sharma.
• Discussions with the employees of Finance Department.
DATA ANALYSIS:
• The collected data has been processed using the tools of
• Ratio Analysis
• Graphical Analysis
Sample Size
• The sample of the study is 5000
These tools access in the interpretation and understanding of the Existing scenario of the Share Capital.
DATA ANALYSIS AND INTERPRETATION OF RATIO
(RS IN CR.)
YEAR 2012-13 2013-14 2014-15 2015-16
• NET WORTH = EQUITY + RESERVES AND SURPLUS ROE 6.3 8.3 6.19 4.21
8 1
9 8.31
8
ANALYSIS:-
7 6.38 6.19 • Return on net worth has shown a consistent trend expect
6 for the expect for the financial year 2012-2013 which has
5 4.21 RETURN ON EQUITY
4
been the year of global turmoil.
3 • In 2013-2014 the return on net highest during the period of
2 four year
1
0
2012-13 2013-14 2014-15 2015-16
B) MARKET PRICE OF THE SHARE
• Market value of the shares may be regarded as the most important measure for determining the
value of the holding of the shareholders. The shareholders of the company are interested in the
market price of the share rather than in the dividend income. Therefore, it is also some important
aspects for the company to increase the market price of the share of the company.
YEAR 2012 - 13 2013 - 14 2014 – 15 2015 – 16
ANALYSIS
MARKET PIRCE 643.64 783.59 1040.59 1204.98
In the above year price of are shares is
(HIGH) continuously increasing due to growth in
MARKET PRICE 624.85 760.72 1010.61 1166.59 earnings of the company and
(LOW)
improvement in the GDP the price of the
shares increased dramatically. Increase in
1400
1200
share price is an important aspect for the
1000 company as well as for shareholder.
800 MARKET PRICE (HIGH)
600 MARKET PRICE (LOW)
400
200
0
2012-2013 2013-2014 2014-2015 2015-2016
C) DIVIDEND PER SHARE
• As the amount of the profit which has been distributed to the shareholders.
• The company dividend is dependent on the future growth prospects available for it various businesses. If there are avenue
available for investment or capital expansion which can provide better return and enhancing shareholders wealth, the companies
propose to retain the profits than distributing to its shareholders.
• However, there are many reason to the company to pay dividend. If company cannot pay dividend it may affect its market price
and adversely impact the investor.
8
YEAR 2012– 13 2013-14 2014- 15 2015- 16
6
0
2012-13 2013-14 2014-15 2015-16
ANALYSIS
Company has maintained a consistent dividend payout policy. The dividends of the company has been
increasing expect for the financial year 2013-2014, after that the dividend payout is constant to year
2014-2015, and the year 2015-2016 dividend payout is decrease. Dividend per share of the company is
going hand in hand with the increasing in reserve & surplus of the company.
How punctual is Investor Service Centre of Aditya Birla Nuvo Limited in
sending you your Annual Reports??
INTERPRETATION:
Here, this Pie Chart give idea that 60% shareholders get the reports on
time and 2% receives very late due to location of their city or town. But
they should can use Fast Courier Services to avoid very late situation.
Thus, other shareholders are being satisfied with the services.
You may be occasionally visiting or telephoning Investor Services Centre. You find
hospitality and efficiency of the concerned persons attending you?
Particular % of Shareholders
% of Shareholders
Excellent 88%
0%
2%
10%
Good 10%
Satisfactory 2% Excellent
Good
Poor nil Satisfactory
Poor
88%
INTERPRETATION:
Almost each Shareholder is getting the Excellent response from the employees of Investor Services
Center. They are fully satisfied by the behavior and Services provided by them. That why the 88% of
Shareholders have feedback of excellent.
Overall Rating for Investor Services Centre is???
Particular % of Shareholders
% OF SHAREHOLDERS
Good Poor
5% 0%
outstanding 83% Very Good
20%
Very Good 22%
Good 5%
Poor Nil
outstanding
75%
INTERPRETATION
By this chart we can see that overall performance of Investor Services Centre of Aditya Birla Nuvo Ltd
has been satisfactory to shareholder as they had reviewed 75% outstanding in their feedback of
shareholder have reviewed outstanding in their feedback. Quality of information from that as they have
reviewed.
FINDINGS
• The following are the aspects which can be regarded as the most
important of the report.
• By comparing return on investment and return on equity, it can be
said that company has taken the advantage of leverage to increase
the value for the shareholders.
• Market value of the company increasing over the period of the time.
• Profitability ratio of the company has been fluctuating as the
company operates in various business and their performance is
dependent on a various factor which are not common.
SUGGESTIONS