WORKING CAPITAL MANAGEMENT of

Mahindra & Mahindra Finance

By Ashish Garg
MBA FINAL YEAR
3rd sem
 MEANING
 Working capital refers to short term
funds to meet operating expenses. It
refers to the funds which a company m
ust possess to finance its day to day
operations. It is concerned with the
management of the firms current asset
s and current liabilities.
 Constituents of Current Assets and C
urrent Liabilities
 Current Assets- Inventories (Raw mate
rials , Work - in process, Finished g
oods), Trade debtors, Loans and advan
ces, Investments, Cash and bank balan
ces
 Current Liabilities- Sundry creditors
, Trade advances, short term Borrowin
gs, etc
 Needs and Objectives of work
ing Capital
 For the purchase of raw materials
 To pay wages and salaries
 To ensure day to day overhead costs such
as fuel, power and office expenses etc.
 To meet selling costs such as packaging
and advertising expenses
 To provide credit facilities to the cust
omers
 To maintain the inventories of raw mater
ials, working in process and finished go
ods.
Concept of Working Capital

There are two concepts of working cap

ital:
 Gross working capital
 Net working capital
 Gross working capital
The total of all current assets are
termed as gross working capital or
circulating capital

Significance
of Gross Working Capital
 Optimum investment in Current Asset
s
 Financing of Current Assets
 Net working capital
The difference between current assets and c
urrent liabilities is known as net working
capital.

Significance of Net Working Capital

 Maintaining liquidity
 To decide upon the extent of long term capi
tal in financing current assets
 Vision statement
To be an engineering company of International repute, pr
oviding best of products & services with contemporary
Technologies ton suit customer needs.

 Mission statement
To focus on our customers market challenges and need
s by providing excellent products In order to cons
istently create maximum value for our customer.
 Mahindra story
 In 1962 M&M formed a joint venture with internati
onal Harvester to make FINANCE carrying the name M
ahindra name plate. Armed with engineering, toolin
g and manufacturing know hoe gained from this rela
tionship.
 M&M is the most respected company in India.For its
SUV model ‘Scorpio’ the company won the National
Award for outstanding in house research and develo
pment.
 Objectives of the study

o To evaluate company performance rela

ting to financial statement analysis
.

o To know the liquidity position of th

e company with the help of current r
atio.
 Scope of the study

The study is limited to Mahindra & Mahindra financial service

ltd.

o The study is based on availability of information

relating to Mahindra & Mahindra financial service
ltd past 5 years data.
o The study focuses on analyzing the working capita
l management.
o To understand the financial position of Mahindra &
Mahindra financial service ltd. For the current ye
ar.
 Research methodology
 Research is an academic activity and such the t
erm should be used in a technical sense. D. sle
singer and M. stephenson in the Encyclopedia of
social sciencesdefine research as “ the manipu
lation of things, concept or sysmbols for the p
urpose of generalizing.
 Secondary data is data collected by someone oth
er than the user. Common sources of secondary d
ata for social science includecensus, organizat
ional records and data collected through qualit
ative methodologies or qualitative research.
 The data is collected through the sec
ondary sources like:
 Annual reports of the company.
 Office manuals of the dept.
 Reports in the company.
 Data analysis.
• Through graphs
• Trend analysis.
 Conclision
 Cash and Bank balances are increasing showing an u
pward trend of liquidity position of the firm.
 The management has to decrease the loans taken by
outsiders as it demands more interest.
 Total assets of the firm must be properly maintain
ed because the value of total assets was decreased
.
 From the above study current liabilities are incre
asing. So the company has ton pay the loans and bi
lls to reduce the liabilities and interest burden.
Thankyou