BANGALORE UNIVERSITY
A STUDY ON WORKING CAPITAL MANAGEMENTAT
A PROJECT PROPOSAL SUBMITTED TO BANGALORE UNIVERSITY FOR THE
AWARD OF DEGREE OF
MASTER OF BUSINESS ADMINISTRATIONCHANDRASHEKAR .A.C. (Reg. No:
09QZCMA020)UNDER THE GUIDANCE OF
Ms.SHWETHA.N.S(Assistant Professor)Bangalore Institute of
Management Studies
BANGALORE INSTITUTE OF MANAGEMENT STUDIES
Approved by AICTE, Affiliated to Bangalore University,
Recognized by Govt. of KarnatakaNo. 35, Opp. R. V. Engineering
College, Mysore Road, Bangalore 560059, India
2009-11
STUDENTS DECLARATION I hereby declare that the dissertation
titled A study on Working Capital Management at Karnataka
Co-operative Milk Federation Ltd., Bangalore Submitted by me to the
Department of Management, Bangalore University in Partial
fulfillment of requirements of MBA Programme is a bonafide work
carried by me under the guidance of Assistant Professor Ms.Shwetha.
This has not been submitted earlier to any other university or
Institution for the award of any degree diploma / certificate or
published any time before. DATE: CHANDRASHEKAR.A.C PLACE: BANGALORE
Reg. No. - 09QZCMA020CERTIFICATE OF FACULTY GUIDEThis is to certify
that Chandrashekar.A.C. Reg. No. 09QZCMA020 has successfully
completed his research work and has submitted the report under the
guidance and supervision towards the partial fulfillment of the
requirements of MBA course of Bangalore University,
Bangalore.Date:
Ms Shwetha.N.S (Professor) Place: Bangalore Sign. Of Faculty
GuideACKNOWLEDGMENT It gives me a great pleasure to have the
privilege of expressing my indebtedness and gratitude to thank
Almighty God for giving me the strength and wisdom to complete the
project successfully.
This study will be incomplete without acknowledging my sincere
gratitude to Dr. S. Radha, Director, Bangalore Institute of
Management Studies, for providing me the opportunity to conduct
this project.
I am grateful to my project Internal Guide, Ms.Shwetha.N.S , for
his support, assistance throughout the project work.
My sincere thanks to the External Guide Mr.Lokesh for dedicating
his time, constant support, assistance throughout the project work.
And, I would also thank all the other staff KMF Ltd, for their
co-operation and guidance during the project work. Place: Bangalore
CHANDRASHEKAR.A.C
Date: Reg. No- 09QZCMA020EXECUTIVE SUMMARYKarnataka Milk
Federation which is most popular as KMF, evolved itself as a
premier and most profitable dairy farmers' organization in the
State of Karnataka. As an agency in 1975 to implement the World
Bank Aided Dairy Development Projects, Karnataka Dairy Development
Corporation (KDDC) was formed, the company grew itself fast and as
it spreads the wings of new found rural economic activity -
Dairying all over the State, the genesis of apex cooperative body
took the shape of KMF in 1983 encompassing entire State with 13
District Co-operative Milk Unions executing the various parameters
of Dairy activity - organization of Dairy Co-operatives, Milk
Routes, Veterinary Services, Procurement of milk in two shifts of
the day, Chilling, Processing of milk, distribution of milk and
also establishment of Cattle Feed Plants, Nandini Sperm Station,
Liquid Nitrogen Supply, Training Centres - as its main stay.
The study covers the concepts of working capital management and
their components. The primary objective of any business is to
maximize the value of the Federation and maximize the wealth of the
share holders .The dissertation titled A study on working capital
management with special reference to KMF Ltd. Bangalore.
Accordingly a research deign was prepared. Relevant primary and
secondary data were obtained. Primary data were collected through
personnel talk with finance manager of the federation and secondary
data were obtained through companys websites and annual report of
five years i.e., 2007-09. Ratio Analysis is the analytical tool
used for the study.
Analysis and interpretation gives information about, how much
the company earns profits, how the company manages with available
funds, to know how it maintain funds through reserves and
surpluses, to know the maintaining of cash and bank balance and how
they manage inventories whether the company earn profits for a
longer period of time which helps the company to be provided in the
best possible way in order to improve their performance and for
their future expansion or diversification of the company and
sustain for longer period. Table of ContentsSL. NO. CHAPTERSPAGE
NO.
1 Introduction1 13
Introduction about study1
Need for working capital2
Objective of working capital2
Classification of working capital3
Advantages of adequate working capital7
Disadvantages of inadequate working capital8
Factors determining the working capital9
Principle of working capital13
2Research Design14 16
Title of the study14
Statement of the problem14
Need for study14
Objective of the study14
Scope of the study15
Research methodology15
Data analysis16
Limitations of the study16
3Profile of the company17 36
Industry review17
Company Review18
4Data Analysis and Interpretation37 63
5Summary of Findings, Recommendations & Conclusion64 67
Findings64
Suggestions66
Conclusions67
6Bibliography68
7Annexure69 73
LIST OF TABLES
Sl. No.Table DescriptionPage No.
1Constitutes of Current Assets...5
2Constitutes of Current Liabilities.6
3Showing KMF Officers20
4Showing Growth Process of company.22
5Showing Milks composition.28
6Showing Class & type of milk30
7Showing contents of milk.34
8Showing Structure of gross working capital.39
9Showing Net working capital.41
10Showing Current ratio43
11Showing Working capital turnover ratio45
12Showing Cash ratio.47
13Showing Trend analysis..49
14Showing Quick ratio...51
15Showing Current asset to total asset...53
16Showing Current liability to total liability.55
17Showing Current assets to Fixed assets...57
18Showing Inventory turnover ratio60
19Showing Net profit to net sales..62
LIST OF CHARTSSl. No. Chart DescriptionPage No.
1Classification of Kinds of Working Capital 3
2Factors Determining Working Capital 9
3Principles of Working Capital Management12
4Organization structure of KMF Ltd ...19
5Showing Structure of gross working capital.40
6 Showing Net working capital.42
7Showing Current ratio44
8Showing Working capital turnover ratio46
9Showing Cash ratio.48
10Showing Trend analysis..50
11Showing Quick ratio...52
12Showing Current asset to total asset...54
13Showing Current liability to total liability.56
14Showing Current assets to Fixed assets...59
15Showing Inventory turnover ratio61
16Showing Net profit to net sales..63