aman jaiswal

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WORKING CAPITAL MANAGEMENT OF

SOUTH EASTERN COALFIELD LIMITED

Presented By:-Aman Jaiswal

On19th November 2011


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Introduction of coal India ltd.

History

Milestone

Vision and Mission


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SECL is the largest coal producing company in the country. Itis one of the eight subsidiaries of CIL (A Govt. undertakingunder Ministry of Coal). SECL

Indias premier coal company is operating its coal mines inthe state of Madhya Pradesh and Chhattisgarh state which isalso geographically located at the heart of the country.

It is having 89 coal mines situated in the state of Madhya

Pradesh and Chhattisgarh.


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Mission of coal India ltd.To produce and market the planned quantity of coal and products

efficiently and economically with due regard to safety conservationand quality.

Vision of coal India ltd.To be the leading energy supplier in the country through bestpractice from mine to market.

Vision of south eastern coalfield ltd.To be the leading energy supplier in the country through bestpractice from mine to market.


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Working Capital Management

Working capital management is concerned with the problems arise in

attempting to manage the current assets, the current liabilities and the

inter relationship that exist between them.Working capital = current assets current liability

There are two concepts of working capital management:

Gross working capital Net working capital


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Ratio Analysis:Ratio analysis is the one of the powerful tools of the financial analysis.

Accounting ratios can be expressed in various ways such as: - A pure ratio, say ratio of current assets to current liabilities is 2:1.

A ratio, say current assets are two times of current liabilities.

A percentage, say current assets are 200% of current liabilities.


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1. Current Ratio

2. Working Capital Turnover Ratio.


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3. Net Profit Ratio

Interpretation:The increase in the ratio shows the better performance of the company

in the year 09-10 as compared to 08-09.


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The study of working capital management of south eastern coalfield

ltd. has revealed that the current ratio was as per the standard

industrial practice but the liquidity position of the company showed anincreasing trend.

Working capital of the company was increasing and showingpositive working capital per year.

Positive working capital indicates of the company.

Companys current assets were always more than requirement.

Current assets are more than current liabilities.


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On study and analysis of working capital. I would like to recommend.

Company should raise funds through short term sources

Company has to take control on cash balance.

Company should reduce the inventory holding period with use ofzero inventory concepts.

Over all company has good liquidity position and sufficient funds to

repayment of liabilities. Company has accepted conservative financial

policy and thus maintaining more current assets balance. Company isincreasing sales volume per year.

aman jaiswal

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