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A Project Report
OnWorking Capital Management
Of
Jaypee Cement.
NO DREAM TOO BIG
Submitted To-
Dr. H.P.Maheshwari
Director, G.N.I.T-M.B.A (272)
Submitted By-
Avinash Kr. Tripathi
2nd Year, M.B.A-272,
Roll No.- 1027270025,
I.D. NO.-272191.
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Mr. JAIPRAKASH GAUR
FOUNDER & CHAIRMAN
JAYPEE GROUPS
Mr. MANOJ GAUR.
EXECUTIVE CHAIRMAN & M.D
JAYPEE GROUPS
KEY person:-
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CEMENT FACTORY’S OF JAYPEE GROUPS:-
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DEFINITION OF TERM WORKING CAPITAL:-
“Working Capital is the Life-Blood and Controlling Nerve Center of abusiness”
Working capital is relative liquid (which can be converted into cash)portion of
the total capital of the business. It is that portion of capital which is required
for holding current assets like stock of materials and finished goods, bills
receivables, and cash for meeting current expenses like salaries, wages,
rent,etc.
“Working Capital, also called Net Current Assets, is the excess of Current Assets
over Current Liabilities. All organizations have to carry Working Capital in one
form or the other. The efficient management of Working Capital is important fromthe point of view of both liquidity and profitability.
Working Capital = Current Assets-Current Liabilities
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OBJECTIVE OF THE RESEARCH:-
1. To know the liquidity of the company.
2. To know the operational efficiency of the company.
3. To know the creditability of the company.
4. To know the functioning of the daily activities of company.
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SCOPE OF THE RESEARCH:-
This project is vital for me in the following ways:-
1. This project will be a learning device for me as a finance student.
2. Through this project we would study the various methods of the working
capital management.
3. The project will be a learning of planning and financing of working
capital.
4. The project would also be an effective tool for credit policies of the
companies.
5. This project will show different methods of holding inventory and dealing
with cash and receivables.
6. This will show the liquidity position of the company and also how do they
maintain a particular liquidity position.
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RESEARCH METHODOLOGY:-
A system of model procedures and techniques used to find theresults of research problem is called research methodology.
RESEARCH DESIGN:-
The purpose of the methodology is to design the research procedure.
This includes the overall design, the sampling procedure, the data
collection method and analysis procedure.
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TYPE OF RESEARCH DESIGN:-
Basically there are two types of researches, which according totheir applicability, strength, weaknesses, and requirements used
before selecting proper type of research, their suitability must be
seen with respect to a specific problem two general types of researches are -
EXPLORATORY CONCLUSIVE
TYPE OF RESEARCH DESIGN
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1.Exploratory Research Design:-
It is also known as qualitative research, it seeks to discover new
relationships, it aims a defining the main problem & inducing the
identification of the relevant variables and the possible alternative
solutions. METHOD OF EXPLORATORY RESEARCH:-
1. The Survey Of Concerning Literature.
2. Experience Survey Or Survey Of Experts.3. Pilot Study.
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2. Conclusive Research DESIGN:-
It is also known as quantitative research; it is designed to help
executives of action that is to make decision.
Conclusive research provides information, which helps the
executives make a rational decision. In some instances, particularly
if any experiment is run, the research may come close to specifying
the precise alternatives to choose, in their cases especially with
descriptive studies the research will only particularly clarify the
situation and much will be left to the executives’ judgment.
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Data collection Method:-
1. Primary data:-
i. Sales Book,
ii. Company Ledger.
2. Secondary data:-
i. Annual Report Of The Company,
ii. Website-www.jalindia.co.in
www.google.com
www.wikipedia.com
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Sample Size
The sample size selected is of Three years.
Sampling technique
Software tools used for the data analysis. The software tools used
for data analysis in MS WORD & MS EXCEL.
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DATA ANALYSIS
RATIO ANALYSIS:-
Ratio analysis is one of the techniques of financial analysis to
evaluate the financial condition and performance of a business
concern. Simply, ratio means the comparison of one figure to
other relevant figure or figures.
According to Myers , “Ratio analysis of financial statements is astudy of relationship among various financial factors in a
business as disclosed by a single set of statements and a study of
trend of these factors as shown in a series of statements."
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Profitability
Ratios
Liquidity
Ratios:
Activity Ratios:
1. Gross Profit Ratio
2. Net Profit Ratio3. Earnings Per Share Ratio
1 Current ratio2 Liquid /Acid Test / Quick
Ratio
1 Inventory/Stock Turnover
Ratio
2 Debtors/Receivables
Turnover Ratio
3. Fixed Assets Turnover Ratio
CLASSIFICATION OF RATIO’S
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1- Profitability Ratio:-
i. Gross Profit Ratio:- Gross profit *100Net Sales
ii. Net Profit Ratio:- Net Profit * 100Net sales
iii. Earnings Per Share Ratio:- Net profit after tax-Preference dividend
No. of Equity Shares
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25.45 27.03
17.45
14.64
16.27
8.627.58 8.04
5.49
0
5
10
15
20
25
30
2009 2010 2011
Gross Profit Ratio Net Profit Ratio Earning Per Share
Graphical Presentation Of Profitability
Ratio:-
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2 - LIQUIDITY RATIO:-
i. Current Ratio:- Current assets
Current Liabilities
ii. Liquidity Ratio:- Quick Assets
Current Liabilities
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2.01
2.52 2.58
1.58
1.99 1.94
0
0.5
1
1.5
2
2.5
3
2009 2010 2011
Current Ratio Liquid Ratio
Graphical Presentation Of liquidity Ratio:-
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3- ACTIVITY RATIOS:-
i. Fixed Assets Turnover Ratio :- Cost of sales or Net Sales
Net fixed assets
ii. Inventory Turnover Ratio:- Cost of goods sold
Average inventory at cost
Inventory Turnover Ratio:- Net sales/ Average inventory at cost
Inventory Turnover Ratio:- Net sales/Average inventory at selling price
Inventory Turnover Ratio:- Net sales/Inventory
iii. Debtors Turnover Ratio= Net Sales/ Debtor
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0.31 0.4 0.44
6.837.75
6.767.66 7.17
6.09
0
1
2
34
5
6
7
8
9
2009 2010 2011
Fixed Assets Turnover Ratio Inventory Turnover Ratio
Debtors Turnover Ratio
Graphical Presentation Of activity Ratio:-
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Results & findings
1) Jaypee group is the 3rd largest cement producer in the country.
2) The first plant was established by Mr. Jai Prakash Gaur in 1986 in
Rewa,(M.P)
3) Jaypee groups now diversified in infrastructure conglomerate with
business interests in Engineering & Construction, Power, Cement,
Real Estate, Hospitality, Expressways, Sports & Education (not-
for-profit).
4) Companies profitability is falls so it shows that the company
efficiency and performance is falls.
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Continued:-
5) Companies liquidity is grows so it shows the margin of safety of
company that possesses to cover the short term debts.
6) The fixed assets turnover ratio measure the company ability to
generate the net sales from fixed assets investment, higher fixed
assets turnover ratio shows that the company has been more effectivein using the investment in fixed assets to generate the revenue.
7) Low Inventory shows that there is a risk they holding obsolete
inventory which is difficult to sell.8) Fall in debtor turnover ratio shows that the debts collection of
company is not up to mark.
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