Transcript
A GROUP PRESENTATION
ON WORKING CAPITAL OF TEXTILE INDUSTRY
Submitted To:Dr. Ashwin Dave
Submitted By: Monali Prikh-81 Kinjal Patel-90 Urvi Patel-103 Krina Patel-109 Kinjal chaudhri-115 Preeti khunti-64
Flow Of Presentation
IntroductionConcept of working capitalList of the companiesRatio AnalysisGraphical presentation of ratiosconclusion
Chimanbhai Patel Institute Of Management & Research
Introduction
Definition: According to Hoagland “ Working capital is a
descriptive of that capital which is not fixed but the more common use of the working capital is as the difference between the book value of current asset and current liabilities.”
It is the combination of two words- (1) Working (2) capital
Introduction
CONCEPT OF WORKING CAPITAL There are two concept of working capital: gross and net.Gross working capital:Net working capital:Significance of working capital:
Cash
Raw material
Work in progress
Finish goods
Receivable & debtors
Credit payment
Circulation system of working capital
List of Company
Arvind mills Bombay dyeing Reliance Siyaram Raymond Chiripal Grasim Welspun Mafatlal Surat textiles
FORMULA-RATIO ANALYSIS
Current Ratio = Current Assets / Current LiabilitiesD/E Ratio = Long-Term Debt / Shareholders' EquityLong-Term Debt Equity Ratio = Long-Term Debt /
Permanent CapitalInventory Turnover Ratio = Cost Of Goods Sold / Average
InventoryDebtors Turnover Ratio = Net Credit Sales / Average
DebtorsTotal Assets Turnover Ratio = Cost Of Goods Sold /
Average Total AssetsNet Profit Margin (%)= Earnings after Interest and Taxes
(EAT) * 100 / Net Sales
Graphical Interpretation-Arvind Mills
Graphical Interpretation-Bombay Dyeing
Graphical Presentation-Reliance
Graphical Presentation-Siyaram
Graphical Presentation-Raymond
Graphical presentation-Chiripal
Graphical presentation-Grashim
Graphical presentation-Mafatlal
Graphical presentation-Wellspun
Graphical presentation-Surat textiles
Average of Ratio
CURRENTRATIO
D/ERATIO
L.T.D/E RATIO
INVENTORYRATIO
DEBTORS’TURNOVER
RATIO
TOTALASSETSRATIO
NETPROFITWORTH
ARVINDMILLS
2.282 1.394 1.266 4.456 7.728 0.726 1.912
BOMBAYDYEING
0.938 5.732 3.708 4.456 3.568 0.726 -0.666
RELIANCE 1.038 0.502 0.416 9.256 24.434 1.34 10.434
SIYARAM 0.952 1.384 0.64 10.405 5.378 1.842 3.566
RAYMOND 1.292 0.98 0.772 7.162 5.378 0.599 1.992
CHIRIPAL 3.16 2.304 1.754 4.516 4.78 0.538 2.01
GRASHIM 0.864 0.294 0.232 5.726 3.78 0.847 19.068
WELLSPUN 0.894 2.75 2.136 17.98 15,96 0.673 2.158
MAFATLAL 0.812 0.06 0.054 9.27 13.296 1.63 18.354
SURATTEXTLES
1.982 3.734 3.542 15.32 44.82 2.898 1.944
Conclusion
1). Current ratio (2:1): It shows the relationship between current assets and current
liabilities. Chiripal and arvind mills has the highest ratio. It shows the current assets are more than current liability. Grasim has the lowest ratio.
2). Debt-equity ratio(1:1): It express the relationship between the exernal and internal
equities or that between the borrowed capital and owners’ capital. Bombay dyeing has poor condition. While mafatlal has lower ratio which is good sign
for the company. 3). Long term D/E ratio: Higher ratio shows the poor condition of the company. Bombay
dyeing has poor condition while mafatlal has lowest ratio which is good for the company. 4). Inventory turnover ratio: If the company gets higher ratio then it is benefit for the
company. This ratio measures the no. of times the stock turns slows or rotates in an accounting period compared to the sales effected during the period. Arvind mills and Bombay has higher ratio which is good sign for the company. While wellspun has the lowest ratio which is not good for the company.
Bibliography
WWW.GOOGLE.COMBOOKS:1. FINANCIAL MANAGEMENT-10TH EDITION; BY- I M PANDEY
2. FINANCIAL MANAGEMENT-8TH EDITION; BY; PRASANNA CHANDRA
Thank You
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