Ppt for Model Viva

8/6/2019 Ppt for Model Viva

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PROJECT MODEL VIVA

A STUDY ON

CASH MANAGEMENT IN

EVEREADY INDUSTRIES

INDIA LTD, CHENNAI

PRESENTATION BY

VENKATESH .S

MBA II YEA


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COMPANY PROFILE

The journey began in 1905 with the first dry cell batteriesbeing imported from USA and sold in the major cities of

the country.

Today, EIIL has a turnover of nearly Rs.1000 crore and

has a diverse product portfolio ranging from carbon zinc

batteries, flashlights and rechargeable, packet tea,

mosquito coils liquid vaporizers and compact

Fluorescent Lamps.

Eveready Industries India Limited (EIIL) is one of Indias

most renowned and enduring FMCG companies, withthe operations entrenched in the country for over 100

years.


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Eveready possesses expertise in manufacturing,

marketing and distributing a diverse range of products to

the entire length & breadth of the country.

Key strengths of Eveready lie in its 4 core assets powerful brands led by the iconic Eveready, a

distribution system that is deeply entrenched, its skill of

efficient mass manufacture and its human capital.


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Vision Statement of the company

We Endeavour to be the perfect Companion to

consumers by providing value-for-money brands with,

Tangible Differentiation in quality every day, we seek

Consumer Proximity to ensure the enjoyment of better

living.


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The Group's operating facilities are located at Kolkata,

Chennai, Hyderabad, NOIDA, Gurgaon and New

Mumbai. EIIL is the worlds third largest producer of

carbon zinc batteries, selling more than a billion units a

year. EIIL is Indias largest selling brand of dry cell

batteries and flashlights (torches), with dominant market

shares of about 46 Percentage and 85 Percentage

respectively.


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CASH MANAGEMENT

Cash is the life blood of a business firm:

it is needed to acquire supplies, resources, equipment,

and other assets used in generating the products and

services provided by the firm.

It is also needed to pay wages and salaries to workersand managers, taxes to government, interest and

principals to creditors, and dividends to shareholders.


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NEED FOR THE STUDY

To evaluate the cash management position of thecompany, because cash management plays a vital role

in the profitability, and in the continued existence of

company.

Cash management gives a clear position about thecurrent assets and current liabilities of the company.

Every company requires sizeable liquid resources to

meet its initial expenses, promotion, formation and

initiating its functioning.

To analyze liquidity ratio and evaluate the ratios range


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SCOPE OF THE STUDY

The analysis has been made using the date availablewith respect to cash management in Eveready Industries

India Limited during the five years (2005-2010).

With the data available for the above years projectionsand recommendations are made.

The study can be used by the finance department of

Eveready Industries India Limited for cashmanagement.


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OBJECTIVES OF THE STUDY

PRIMARY OBJECTIVE To study and analyze the cash management in Eveready

Industries India ltd.

SECONDARY OBJECTIVES

To study the liquidity position of the Eveready IndustriesIndia Ltd.

To evaluate effective management of cash inflows and

cash outflows.

To study the cash position through ratio analysis To analyze future cash requirements using trend

analysis

To suggest measures for effective cash management.


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TOOLS AND TECHNIQUES

Ratio analysis

Cash flow statement

Cash Budget

Cash cycle

STATISTICAL TOOLS

Trend Analysis

Correlation Regression


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CASH FORECASTING

Cash forecasting is backbone of cash planning. Itforewarns a business regarding expected cash

problems, Which it may encounter, thus assisting it to

regulate further cash flow movements.


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CASH MANAGEMENT TECHNIQUE

Every business is interested in accelerating its cash

collections and decelerating cash payments so as to

exploit its scarce cash resources to the maximum. There

are the techniques in cash management which enables a

business to achieve this objective.


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LIQUIDITY ANALYSIS

The importance of liquidity in a business cannot be over

emphasized. Liquidity has an intimate relationship with

efficient utilization of cash. It helps in the attainment of

optimum level of liquidity.


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PROFITABLE DEPLOYMENT OF SURPLUS

FUND

Due to non-synchronisation of cash inflows and cash

outflows the surplus cash may arise at certain points of

time. If this cash surplus is deployed judiciously cash

management will itself become a profit centre. However,

much depends on the quantum of cash surplus and

acceptability of market for its short-term investments.


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ECONOMICAL BORROWINGS

Another product of non-synchronisation of cash inflows

and cash outflows is emergence of deficits at various

points of time. A business has to raise funds to the

extent for the period of deficits. Rising of funds at

minimum cost is one of the important facts of cash

management.


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Cash Cycle

RAW MATERIAL

DEBTORS & BILLS

RECEIVABLES

WORK IN

PROGRESS

FINISH GOODS

SALES


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FINDINGS OF THE STUDY

The operating profit ratio for the increases in alternativeyears from 2004-05. It also exhibits that the company

gives the fair return to its investors, especially in 2005-06

and 2007-08.

The net profit ratio has been in an decreasing trend. This

reveals the operational inefficiency of the business.

The working capital turnover ratio in the year 2008-09

has decreased by (-15.64). The higher volume of saleswith relatively small amount of working capital indicates

the operational efficiency of the company.


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SUGGESTIONS OF THE STUDY

The current ratio is less the standard. The companyshould improve its short term solvency position.

The duration of the cash cycle has to be decreased. The

longer the cycle the greater the level of resources tied

up. Therefore, the profitability of the company would also

be affected.

The company has sound modes to source cash and

inflows are good, the company should adopt the ways to

increase the inflow from operations.

The working capital has to be efficiently managed as ithas decreased abruptly, as it is life blood of business.

Net profit has been in negative, sales and working

capital has to be managed effectively.


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CONCLUSION

Cash is needed for various purposes to acquiresupplies, equipment, and other assets that a business

requires to accomplish its business purpose.

The company is operating in a most efficient

manner. The duration of the cash cycle has to be

decreased as it would affect the profitability of the

company. The company has a sound cash position. The

financial position of the company is satisfactory.

However, the company should try to improve its short

term solvency ratios. The company should look after its working capital

turnover ratio, net profit ratio to improve. The company

has healthy cash from operations. Thus it should be

quite conservative in applications of it.


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THANK YOU

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