Project Report on group

Project Report onAshima Group

Texcellence ComplexKhokhra MehmedabadAhmedabad - 380 021.

INDIA

Submitted To:Prof. ---

Submitted by:

FYBBAN.R. Institute of Business AdministrationAhmedabad2009-2010

N.R. INSTITUTE OF BUSINESS ADMINISTRATIONGLS Campus, Mardia Plaza Lane, Off. C.G. Road, Ellisbridge, Ahmedabad-380006, Phone: 26430373

CERTIFICATE

This is to certify that the report on the visit to_ Ashima Group _

is submitted by Mr._ ____________ _ to N.R. Institute of Business

Administration, affiliated to Gujarat University, in the partial fulfillment of the

requirements for the completion of “Practical Studies” in the area of Management at the

First Year of the B.B.A. Program for the year 2009-2010.

______________ __________ __________________Director In-charge Prof. in-charge External Examiner

Date: / /2010

Acknowledgement

I am highly thankful to the management and staff of Ashima Group I am especially thankful to Mr. --- manager of HR department and Mr. --- manager of Marketing department for helping me in my “Practical Studies”. In addition to allowing me to visit the company and study the organization, they provided me with many details which were very useful in preparing this report.

I take this opportunity to thank our In-Charge Director Prof. ---, Professor in-charge --- for their encouragement and the office staff for providing us all the facilities for making the visit more learning oriented.

(Name)Date:

Preface

Today’s age is an age of management. Management being the backbone of any organization is one critical factor which determines the success and failure of a business unit. The real essence of management lies in the application of the knowledge.

This report is prepared on the basis of an Industrial Visit to Ashima Group. This industrial visit was carried out with a view to gain an insight to the managerial knowledge and skills required in real life situations. The company is a very good example of a firm doing vertically integrated production, vertically integrated production is very important for economizing and to seize the upcoming opportunities in the business world in the 21st century.

The company deals in 100% cotton fabric manufacturing. This report contains all the necessary information of the company and its departments.

It was earlier said, “Knowledge is Power”. But now this saying is replaced by a more correct saying, “Applied Knowledge is Power”. The Industrial Visit and this report is just a small but remarkable step in knowing the practical implications of management.

Index

1 Company Profile 1-31.1 Objective of Visit 11.2 Name of organization 11.3 Business philosophy 11.4 Mission & Vision Statement 21.5 Aims & Objectives 21.6 Status of the company in market 21.7 Special awards & recognition 3

2 History of the organization 42.1 Main History 42.2 Recent Achievements 4

3 Form of Organization 53.1 Advantages & Disadvantages of the Form of Organization 5

4 Organization Structure 64.1 Hierarchy 6

5 Location 75.1 Factory Address 75.2 Reasons for choosing a particular location 75.3 Benefits of Location 75.4 Limitations of Location 7

6 Production 8-136.1 Product Range 86.2 Production Process in sequence 96.3 Plant & technology 106.4 Plant Layout 126.5 Measures to control pollution 126.6 Area of Factory 13

7 Financial Information 147.1 Capital employed 147.2 Sales Turnover 147.3 Profit 147.4 Dividend 14

8 Marketing 15-168.1 Marketing Position 158.2 Market Share 158.3 Physical Distribution & Channels 15

8.4 Advertising & Sales Promotion 168.5 Level of competition 168.6 External or export oriented marketing 16

9 Human Resource Management 17-189.1 Number of workers 179.2 Selection & Recruitment 179.3 Training & Development 179.4 Emoluments & Compensation 179.5 Performance Evaluation & promotion 189.6 Trade union & Management’s relation with the same. 189.7 Separation 18

10 Research & Development 19-2010.1 Quality assurance techniques 1910.2 Future plans & projects 2010.3 Amount spent on Research & Development 20

11 Social Obligations 21

12 Findings 22

13 Suggestions 22

14 Conclusion 23

15 References 23

16 AnnexuresA Organizational Structure of Denim ProductionB Profit & Loss StatementC Balance Sheet

1 Company Profile

1.1 Objective of Visit

A visit to any organization gives an insight to the actual working of organization and process of management. The objectives of this visit was to gain some practical knowledge on how organization actually works, how different departments play an important role for the success of organization and to get information on various aspects of an organization like Finance, Marketing, Production, Human Resource, etc.

1.2 Name of organization

GROUP ASHIMA comprises of the following companies/divisions: Ashima Ltd.Ashima Dyecot Ltd.Nachmo Knitex Ltd. Atrium Exports Pvt. Ltd.Ashima Textiles Inc. USA-100% subsidiary of Ashima Limited

Registered Office: Corporate Office:Texcellence Complex Texcellence ComplexKhokhra Mehmedabad Khokhra MehmedabadAhmedabad - 380 021. Ahmedabad - 380 021.INDIA INDIATel: 079-22773513 Tel: 079-22773513Fax: 079-22773061 Fax: 079-22773061

Website:http://www.ashimagroup.com

1.3 Business philosophy

In 1992, Group Ashima adopted its corporate philosophy of Texcellence as a global mission.

Texcellence means excellence in textiles. This corporate philosophy epitomizes excellence not only in their core textile operations but also in all aspects of their business endeavours. Be it in selection of the most sophisticated technology. In procurement of superior quality raw materials. In rigorous quality inspection at every stage of production. In providing challenges to their human resources. In globally competitive marketing missions. In their concern for clean environment. Or for that matter, in discharging their social obligations.

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Their commitment to the philosophy of Texcellence has brought them closer to their discerning fabric customers across the globe. They cherish the same values that concern their customers and are fired by the same urge to be the best.

Their quest for excellence has frutioned into a fixed assets base exceeding US$ 120 Million. With their consistent policy of adopting the most modern state-of-the-art technology of the world, they can offer the best in cotton fabrics that anybody, anywhere in the world may aspire to.

The philosophy of Texcellence has helped Ashima integrate into a single-window vendor of 100% cotton fabrics for apparels. They offer the most comprehensive range of cotton fabrics for apparels including specialty denims, high value yarn dyed, bleached as well as piece dyed cotton shirting, entire spectrum of bottom weight fabrics with all types of surface finishes, fusible interlinings and high quality processed circular knitted fabrics. All these fabrics are available in pre-cured as well as ready-for-post-curing forms. They also offer garmenting solutions and in the domestic market they have a presence through their brands.

1.4 Mission & Vision Statement

1.5 Aims & Objectives

1.6 Status of the company in market

Group Ashima is one of India’s leading 100% cotton fabric manufacturers. It is a technology driven vertically integrated Group with a turnover of over US$ 135 million per annum. In a short span of 5 years, the Group has invested US$ 120 million in start-of-the-art technology and today is one of the foremost cotton textile players in the world.

They offer the most comprehensive range of cotton textile products, encompassing each and every need of the garment industry. More than two-thirds of their production of 60 million meters of woven and 2800 tones of circular knitted cotton fabrics is meant for exports. On account of their qualitative supremacy the fabrics command an ever-growing base of discerning customers in more than 45 countries across the world. To meet the needs of customers seeking total solutions in terms of packages, they also have garmenting and offer complete services to the best labels/brands across the world. Last but not the least they have a good quality fusible interlining fabrics to complete the basket.

In the true sense, Group Ashima is a single window integrated vendor to meet the requirements of the global customer sourcing 100% cotton fabrics.

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1.7 Special awards & recognition

Group Ashima has achieved several milestones in the march towards "Texcellence".Ashima is the first textile company to adopt and get certified for "Integrated Quality and Environmental Management System" ISO 9001:2008 and ISO 14001:2004.

Ashima fabrics are certified confirming to Oeko-Tex Standard 100 of Germany.

Ashima has been awarded the prestigious Gold Award from Greentech Foundation, New Delhi for excellence in environmental protection in textile sector for the year 2005 for the second year in a row.

  Ashima has been awarded the patent for the invention of a process for treatment of textile waste water by enriched biomass.

Ashima has been certified by Control Union Certifications for Global Organic Textile Standard (GOTS) and Organic Exchange (OE-100 Standard), with which they ensure organic status of textile from harvesting of raw materials, through environmentally & socially responsible manufacturing up to labelling in order to provide a credible assurance to the end consumer.

Ashima has been certified by FLO-CERT GmbH for Fairtrade. This provides a guarentee to the consumers of certified fairtrade products that they are contributing to the Social-Economic development of people through their purchasers.

The company is certified by social compliance agency WRAP, which is widely recognized in the United States.

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2 History of the organization

2.1 Main History

Group Ashima is an enterprise born in 1982, with a moderate capital base of US$ 20,000.

The present form is seen today, as the foremost cotton textile manufacturer with over US$ 135 million turnover and spread over 70 acres of land. This is the result of a vision, and commitment of its founder Mr. Chintan Parikh. The stupendous growth is a result of an enterprise fired by will, a keen eye on the global developments in cotton textiles and an insatiable urge to do nothing but the best by every constituent of Ashima headed by Mr. Chintan Parikh.

Today, Group Ashima has become one of the major success stories in the Indian textiles arena.

In the last 12 years, Ashima has spread its wings across five continents to emerge as one of India’s foremost cotton textiles manufacturers. At the core of this inspiring saga of achievements is Mr. Parikh’s unique ability to identify the potential business avenues in the field of cotton textiles in tune with the changing times and market scenario in early 90’s. His quest for technological supremacy, his obsession for global quality standards, his faith in human resource development, and above all his vision and determination to make Ashima a global textiles group.

In less than two decades, Group Ashima has been able to join the select global league of major cotton textile manufacturer and a major player in Indian textiles arena.

2.2 Recent Achievements

Group Ashima is very badly affected by the recession. So there are no recent achievements of the group in the last 3-4 years.

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3 Form of Organization

There are many forms of business organization viz., sole proprietorship, joint Hindu family business, partnership, company and the co-operative organization.

The section of a suitable form of business organization is a very significant decision for the promoters of a business enterprise; because much of success or failure of business is likely to depend on this choice. The basic objective of the choice of a suitable form of business organization is to select that form, which will help the business enterprise in solving its problems- leading to its growth and prosperity.

3.1 Advantages & Disadvantages of the Form of Organizationof Ashima Group i.e. - Public Ltd. Co.

Advantages:(1) Separate legal existence: Being a separate legal entity, it acts under its own name. The company may own and dispose off property in its own capacity. It can also enter into contracts with members and outsiders.(2) Limited liability: Liability of the members of a limited company is limited to the face value of their shares. Members are not required to contribute to the liabilities of the company beyond the nominal value of shares in case of liquidation of a company.(3) Transferability of shares: Shares in a company can be transferred from one person to another person without the consent of the other members.(4) Continuity of existence: The life of a company depends upon the terms of its memorandum of association, which may be for a specified period. The death or insolvency of its members does not affect the existence.(5) Control: The control over a company can be secured by acquiring majority of the company’s shares.(6) Social benefit: The social benefit of a company is that it gives employment to a number of persons, and contributes to the growth and the development of the nation.(7) Limitation of action: A company may perform only those acts, which are permitted by its memorandum. The scope of the company’s activities is limited by its memorandum.

Disadvantages:(1) Lack of secrecy: The Board of Directors, in which a number of persons may be involved, manages the company. All important matters are discussed in the meeting of directors. In such circumstances, it is rather difficult to maintain the secrecy of the business.(2) Difficulty in formation: Many legal formalities are required to be completed for obtaining a certificate of incorporation.(3) Fraudulent management: There are several provisions under the Companies Act to check frauds; yet frauds are common in many companies.

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4 Organization Structure

The Organizational Structure, which really refers to the chart of organization, is an outcome of undergoing the process of organization. It reflects the authority and responsibility of managers and their subordinates. Its structure reflects the fundamental objectives, policies, procedures etc. of the organization.

Organizational Structure helps management in gaining objectives efficiently, in a changing future environmental scenario. Depending on enterprise situations, an organization structure may take variations.

On the basis of authority-responsibility relationships, organizations might, broadly be of the following basic types:(I) Line organization(II) Functional organization(III) Line and staff organization

4.1 Hierarchy

Note- For Hierarchy (Organizational Structure) of Denim Production refer to Annexure A

While looking to the Organizational Structure of Denim Production of Ashima, one could identify that it is a Functional organization.

A Functional organization is one, in which exercise of functional authority is done by a functional manager or specialist-not only over his own subordinates; but also over all subordinates in all other departments; in so far as, the particular function, pertaining to his specialization is performed by them.

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5 Location

5.1 Factory Address

Texcellence ComplexKhokhra MehmedabadAhmedabad - 380 021. INDIATel: 079-22773513 Fax: 079-22773061

5.2 Reasons for choosing a particular location

Gujarat is a state where production of cotton is done on large scale so being in Gujarat they are near to the raw material.

Distribution center is also near to the location of the factory. Skilled labour is also available easily. Infrastructural facilities such as Water, Sewage, Electricity, Tar Road, Access and

Connectivity to Public Transportation, Goods Transportation, Post, Courier and Telecommunication, Health and Safety Service, etc. are also offered by the location.

So because of the above reasons the location of the factory is in the Khokhra Mehmedabad area which provides all the necessary facilities for a Textile Industry.

5.3 Benefits of Location

The company gets the following advantages by being present in the location where it is at present:

Constant supply of electricity. Skilled labour is available at cheaper rate. Well-developed infrastructural facilities. Market center is located nearby.

All the above advantages help the industry to reduce its cost of production effectively.

5.4 Limitations of Location

There are no major limitations of the current location.

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6 Production

6.1 Product Range

Product range is a collection of products marketed by one company.

Fabric RangeGroup Ashima offers the most comprehensive range of cotton textile products, encompassing each and every need of the garment industry. Thus, they have been able to establish themselves as a one point source for the garment industry, offering:

Denims - Open end, Ring Spun Shirting’s - Fully Bleached Whites, Piece-Dyed, Yarn-Dyed Bottom Weights - PFD, Piece Dyed, Yarn Dyed Knitted Fabrics - Tubular, Open width and Piece-Dyed, Yarn-Dyed, Mercerized,

Compacted and Open Width Interlinings - Microdot Coated fusible woven

Readymade Garments RangeTheir Garment Initiatives offer total solutions to the apparel industry

Shirts, formal as well as casual Trousers, Jeans, Capri Jackets Cargos, Boxer shorts Pajama sets Children wear of all types Women wear and many more.

6.2 Production Process in sequence

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The production process of Denims can be easily understood with the help of the following chart:

Blow Room

Card

Draw frame

Auto core/Ring Spinning

Warping

Dyeing cum Sizing

Air-jet weaving

Sizing

Monforts finish

Inspecting and Folding

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6.3 Plant & technology

…..It has always been Group Ashima’s endeavour to constantly source new technologies from world leaders in textile machinery manufacturing. It’s not surprising then, that their manufacturing facilities are considered to be industry benchmarks. These facilities together are appropriately called the `Texcellence Complex’. …..For denims they have: spinning preparatory from Crossol and Rieter, open-end spinning from Schlafhorst, Air- jet weaving from Tsudakoma, indigo dyeing range from Sucker Muller and finishing from Monforts. For their grey fabric manufacturing operations, they have Tsudakoma Air- jet Looms from Japan.…..They have introduced for the first time in India, ring can technology to produce ring yarn for denims application. This enables them to produce ring denims. This technology has given Ashima an upper edge in denims.…..The yarn dyeing and weaving facility has world-class equipments like sectional warpers and direct warper from Benninger, sizing machines from Benninger-Zell, beam dyeing machines from Hisaka and cheese dyeing machines from Fongs and precision winding machines from SSM. The weaving facility consists of Tsudakoma Air-jets and Picanol rapiers.…..They can be proud of their sampling facilities consisting of Pilot Cheese dyeing from Fongs and single-end sizing machines of Yamada and sample warpers from Suzuki, which have helped them to respond to the world demands for samples in the shortest possible time.…..The commitment to technology is further highlighted by their dye-house, which has the state-of-the-art continuous pretreatment ranges from Benninger as well as from Menzel, the mercerising ranges from Benninger and continuous dyeing ranges with pad dry and pad steam all from Benninger and Babcock. …..They also have the latest stenters from Santex and Babcock, the sanforising range from Monforts and the calendaring from Kleinwefer. The special finishing effects are carried out on the raising and sueding machines from Lafer and Gematex. They also have the caustic recovery plant from Korting Hannover AG. The powder-dot coating machine from Santex produces one

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of the best fusible interlinings. …..The Knit processing for yarn dyeing, fabric dyeing and finishing facilities consist of state-of-the-art equipment from leading European and Japanese companies and technology transfer from Santex AG. They have the continuous mercerizing range from Dornier, soft flow ‘Venus’ dyeing machines from Sclavos, tubular as well as open-width finishing ranges from Santex and yarn dyeing machines from Fong’s . The SSM precision winding machine gives uniform density for best yarn dyeing results.…..The Circular Knitting division has grey fabric manufacturing facility with circular knitting machines from Terrot and Fukuhara of various diameters, for making single jersey, interlock and rib fabric in plain as well as various structures and in various counts. To create engineered stripes with a wide range of structures, they have world-class auto stripers with mini jacquard from Terrot. They have flatbed knitting machines from Shima Sieki to produce accessories like collars and cuffs of various sizes supplied with the body fabric. These machines have auto striping facility with four colours to produce collars with tipping. …..They have also established a modern laboratory having computerized colour-matching system from Datacolor along with Spectraflash – 600 type spectraphotometer and Ahiba Nuance lab dyeing system. All to ensure world-class fabrics that can do the world’s leading brands proud. …..Their garments division has various machines including many special machines to meet the flexible styling requirements of buyers. These include power driven sewing machines Automatic Gerber spreading machine with cutting table, Rotondi finishing equipment with topper press, legger press, foam finisher, collar cuff press, Juki automatic pocket welting machine, Hashima and Kannegiesser fusing machines, electronic bar-tack machine, button sewing machines, spot removing gun many special machine for shape tackling, elastic attaching, pocket making, placket making, waist bend attaching, loop making, pocket creasing, bottom hemming etc., special single needle with under bed thread trimmer and electronic control panel for special operations. …..In consultation with M/s Kurt Salmon & Associates, a sophisticated in-house facility has been

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established in India by Atrium called The Best Engineered Product Laboratory (BEPL). This facility is equipped with one of the latest CAD systems, a cutting and sewing facility and a garment washing and finishing facility. It also has training, customer interaction and archive storage areas and a purpose specific library. BEPL is designed to generate sample prototypes of yet-to-be-ordered garments, keeping in mind the Asian working environment, in virtual reality.

Raw Materials

Group Ashima is one of India’s leading 100% cotton fabric manufacturers, so they mainly uses cotton as raw material for the production process. They also uses dyes for dyeing the fabric.

They purchase the cotton from Gujarat and Punjab. While for getting the Rich Cotton (fine, soft and light weighted cotton) they have to import it from USA.

Table of capacities

Denims 10.5 Million Meters per annum

Yarn Dyeing Shirting’s 11.5 Million Meters per annum

Piece Dyed Shirting’s 04.5 Million Meters per annum

Piece Dyed Khaki - (Bottom Weights)

17.5 Million Meters per annum

Fusing Interlining 06.0 Million Meters per annum

Circular Knitting 15.0 Million Meters per annum

Total   65 Million Meters per annum

Garmenting 01.2 Million Pieces per annum

6.4 Plant Layout

The Company is having Process Layout for its Denim Production, which is also known as Functional Layout.

6.5 Measures to control pollution

Group Ashima firmly believes that they are the guardians of tomorrow’s legacy. All of us should work towards conserving our environment and preserving our natural resources. Their commitment to the `green’ cause is reflected in their thoughts as well as deeds. Their commitment is towards cleaner production, environmental protection & sustainable development. Towards this goal they have invented a technology for an innovative and noble approach to treat

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textile waste by enriched biomass, opening up a new horizon for the environmentalists. The excess biomass can be used as a bio-fuel leading to prevention of air pollution and conservation of water and energy.

Their Corporate Headquarters- Texcellence Complex is in the midst of a lush green park with excellent landscaping and thick green foliage, large artificial lake, garden, lawns…

They adhere to the most stringent of pollution control norms. There are six primary and secondary effluent treatment plants treating a total 3360 M3 per day. Their effluent treatment norms are in tune with world standards.

6.6 Area of Factory

The factory is spread over 70 acres of land.

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7 Financial Information

Note- For Profit & Loss Statement and Balance sheet refer to Annexure B and C respectively.

7.1 Capital employed

The Group Ashima was established in 1982, with a moderate capital base of US$ 20,000. Today, their investment in technology and infrastructure exceeds US $ 120 million.

7.2 Sales Turnover

The Group is doing the turnover of over US $ 135 million per annum.

7.3 Profit

The Net Loss of the Group for the year 2008-09 was Rs. 28.23 Crore. While looking to the Profit and Loss Statement we can say that the Group is running at loss from 2004.

7.4 Dividend

Dividends DeclaredAnnouncement

DateEffective

DateDividend Type Dividend (%) Remarks

14-06-02 20-06-02 Final 0.00 -17-11-97 - Final 28.00 -12-11-98 - Final 18.00 -18-11-99 - Final 15.00 AGM & Dividend30-09-00 - Final 12.50 -

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8 Marketing

8.1 Marketing Position

The Group Ashima ranks second in India among the 100% cotton fabric manufacturers.

8.2 Market Share

Market share of the group is more than 50% in Denim in Ahmedabad.

8.3 Physical Distribution & Channels

Physical Distribution

The Distribution of the products to the end users is done through the Indian garment exporters; their domestic brands and other brands viz. Raymond, Pantaloon, Lee, Wrangler, Ginny & Johnny, Killer, Levis in USA, Ring Denim in UK, etc.

Their Domestic Brands are as follows: ICON brand of fabrics Frank Jefferson brand of garments

There are both company operated and franchisee showrooms of Frank Jefferson brand in various markets across the country.

Distribution Channel

The Distribution Channel of the company’s product could be understood with the help of given diagram:

Group Ashima

Ashima’s Domestic Brands

Other Brands (International

and Domestic)

Indian Garment Exporters

Retail Shops

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8.4 Advertising & Sales Promotion

Advertising:

The company sometimes shows the advertisements of the Domestic Brands i.e. - ICON and Frank Jefferson in News Papers.

Sales Promotion:

The company uses mainly two strategies for the sales promotion which are as follows:

1. Value Added Products: The company used to have Value Added Products

(same products with new and improved qualities) to create difference among the others and their products, so that the big brands purchase the fabrics and garments from them.

2. Nomination of the product: The company prefers to get their fabric nominated,

if the fabric is once nominated then they have the upper hand, they can quote their prices. To nominate their fabric they approach to different brands, show them the features and types of the fabric they have and offer them to buy their products. Sometimes they also go to the showrooms of the brands and identify that which kind of fabric is sold, and then they approach those brands and offer them to buy same kind of fabric.

8.5 Level of competition

The level of competition in the cotton textile industry is high. The major competitors of the Company are Gindal, Shripal and Arvind.

8.6 External or export oriented marketing

Ashima exports its fabrics to more than 45 countries. Around 60% of product is exported to USA, Egypt and Europe. More than two-thirds of their production of 60 million meters of woven and 2800 tones of circular knitted cotton fabrics is meant for exports.

Ashima also markets its fabrics to more than 150 Indian garment exporters.

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9 Human Resource Management

9.1 Number of workers

The total strength of the people working in the company is 4000. Among them 600 are managerial employees and 3400 are workers. Out of 3400 workers, 400 workers are engaged in the Denim production process.

9.2 Selection & Recruitment

The process of recruitment and selection starts only after the approval of Ms. --- the head of HR and IR department.

For recruitment and selection first preference is given to the employees references, second preference is given to the www.naukri.com, www.monster.com and third preference is given to the manpower consultancies viz. Sarthi Consultancy, Career Mosile Consultancy, Anil Consultancy.

9.3 Training & Development

In the field of human resource management, training and development is the field concerned with organizational activity aimed at bettering the performance of individuals and groups in organizational settings. It has been known by several names, including employee development, human resource development, and learning and development.

The Company is organizing young engineers forum on regular basis. Under this forum engineers are giving lectures to the employees so that they can update their knowledge.

9.4 Emoluments & Compensation

Emoluments

Amounts received from an office or employment including all salaries, fees, wages, perquisites, and other profits as well as certain expenses and benefits paid or provided by the employer, which are deemed to be emoluments.

Compensation

Compensation is something which is given to reduce or balance the bad effect of loss, suffering or injury.

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9.5 Performance Evaluation & promotion

Performance appraisal

Performance appraisal is an evaluation of the performance of an employee. The results of the appraisal may be used in deciding an employee’s pay, career prospects, training, or job satisfaction. It is usually carried out by means of an interview with the employee’s immediate manager, although in some cases self-appraisal may be used.

In most organizations appraisal consists of assessing the employee’s ability to meet objectives and his or her general demeanour as a member of the workforce.

The company is having its performance appraisal usually every month starting from March for which they are using the Rating Scale Method.

9.6 Trade union & Management’s relation with the same.

Trade union

Trade union is an organization whose principal purposes include the regulation of relations between employees and employers or employers’ associations. Unions’ affairs are regulated by the Trade Union Act (1984) and the Employment Act (1988).

9.7 Separation

Before separation 1 Month or 3 Months notice period is given so that one can improve himself.

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10 Research & Development

10.1 Quality assurance techniques For Group Ashima quality is the only password. Quality assurance perhaps assumes more importance than any other aspect for the group. And rightly so, because the discerning customers that the group services, would want nothing but top-notch quality. Towards this end they have one of the best SQC Laboratories, any textile infrastructure can boast of. Group Ashima is equipped with testing laboratory known as Lalita Hargovandas Research Centre. This research centre was established in 1996. This research centre cum lab is well equipped with ultramodern testing facilities and well-trained technical experts. Apart from this their lab is well conditioned round the clock as per international standard and is continuously monitored by a temperature - humidity chart recorder Well-known national as well as international garment brands/retailers have approved this lab. Their lab is accredited by manufacturers to retailers, as they carry out in-house testing with high standard of accuracy and reliability. The laboratory is involved in the testing of cotton, yarn, grey fabrics, dyes, chemicals, auxiliaries and different kind of fabrics at various stages of processing. They have for cotton testing HVI-900 system, version 3.5 for testing length, strength, elongation, colour and micronaire; micro dust trash analysis – 3 for testing fresh, fibre fragments and micro dust in raw cotton apart from a host of other equipment for micronaire testing, fineness and maturity testing of raw cotton, Lea making for count, CSP measuring, count strength, count determination and the likes. The yarn both in-house production and outside purchase undergoes severe test before weaving. The Uster Classimat III analyses the fault in matrix order of single ply yarn. The Uster Tensojet tests the tensile strength of yarn at speeds of 400, 200, 100 and 50 meters per minutes. The Uster Evenness Tester III checks the yarn imperfectness. They also have electronic TPI tester, Sigmascope Uster Tensokid and the like. The grey fabric testing is elaborate too. The Alphatens’ tests the tensile strength of fabric at a speed

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of 500 mm./mints; the lea strength tester measurers the CSP of yarn. They have the stiffness tester, warp elongation tester, fabric stretch tester etc. The finished fabric is tested for various fabric parameters as per international standard testing methods like AATCC, ASTM, ISO, etc. The finished fabrics tests are carried out for constructions, weight, percentage shrinkage, Skew/bow %, tear strength DP ratings, CIE whiteness, pH, abrasions, seam slippage, spray rating (for Teflon coated), percentage stretch / percentage recovery (for lycra contents), colour fastness. For this purpose host of sophisticated testing equipments all from well known suppliers matching world standards have been employed like Martindale (Abrasion Resistance, etc) , colour fastness like Megasol (Light Fastness), Gyrowash (Washing Fastness), Wascator (Dimensional stability), and Morapex (fabric core pH measurement).

10.2 Future plans & projects

The company doesn’t have any future plans and projects because currently it is facing the problem of liquidity ratio.

10.3 Amount spent on Research & Development

The Group spends its 2% of Net Profit on Research and Development every year.

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11 Social Obligations

The Group has sponsored various parks, public gardens belonging to The Ahmedabad Municipal Corporation. They have completely renovated them with tree plantation, fountains, children's park, jogging track and lighting. The gardens are continuously monitored and maintained by them. In fact they have won accolades from the people frequenting the parks and it has been instrumental in fetching the Municipal Corporation national awards. Group Ashima has also supported various charitable, educational, cultural and research institutions along with slum clearance, city beautification and preservation of heritage and culture of India. Group Ashima, as a policy, employs no child labour in its work force. In fact, it is a crusader against the use of child labour and thus strongly prohibits employment of child labour even by its associates. They actually ask their builders and contractors to furnish bonds to ensure that they do not employ any child labour.

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12 Findings

The Company is not getting the benefits provided by the Govt. to the industries located in the Industrial Area because it is not located in an Industrial Area.

The factory is spread over 70 acres of land and this space is not utilized completely by the Company.

Ashima is the Company which is despite running at its full capacity making loss; the reason is that it has not been able to recover from the onslaught of the recession.

13 Suggestions

Company should expand its production by utilizing its free land area around its production unit.

As there is an increasing demand of Denim in the market so the company should increase the production of Denim by setting more machines, in order to increase its profitability.

Company should try to increase the efficiency and reduce the cost of production as much as possible for speedy recovery.

Strategies should be made by the Company to face the future recession so that it may not suffer like it suffered in the last recession.

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14 Conclusion

Ashima’s commitment to the philosophy of Texcellence has brought it closer to the discerning fabric customers across the globe.

Ashima has always believed in investing in the most modern and state-of-the-art technology available in the world.

The Company offers the most comprehensive range of cotton textile products, encompassing each and every need of the garment industry.

The Company is committed towards cleaner production, environmental protection & sustainable development.

The Company is facing the problem of liquidity ratio and has not been able to recover from the setback of the recession so this problem could jeopardize the Company if it is not managed efficiently.

15 References

http://www.ashimagroup.com/ http://www.moneycontrol.com/; Source: Religare Technova

25

Annexure BProfit & Loss Statement of Ashima

Section 1.01 ------------------- in Rs. Cr. -------------------

Dec '04 Mar '06 Mar '07 Mar '08 Mar '09

12 mths 15 mths 12 mths 12 mths 12 mthsIncomeSales Turnover 483.03 449.46 236.14 223.21 208.20Excise Duty 13.14 1.55 0.00 0.00 0.00Net Sales 469.89 447.91 236.14 223.21 208.20Other Income -18.46 -63.91 -11.07 -21.25 -8.23Stock Adjustments -2.90 0.93 -1.23 -5.06 -4.48Total Income 448.53 384.93 223.84 196.90 195.49ExpenditureRaw Materials 352.70 294.44 141.14 133.70 123.86Power & Fuel Cost 17.87 29.90 22.39 23.34 22.11Employee Cost 24.21 32.89 27.81 28.55 25.77Other Manufacturing Expenses 23.25 30.20 22.00 21.97 16.22Selling and Admin Expenses 7.66 16.09 12.08 0.00 0.08Miscellaneous Expenses 1.30 1.29 1.07 12.83 15.24Preoperative Exp Capitalised 0.00 0.00 0.00 0.00 0.00Total Expenses 426.99 404.81 226.49 220.39 203.28

Dec '04 Mar '06 Mar '07 Mar '08 Mar '09

12 mths 15 mths 12 mths 12 mths 12 mthsOperating Profit 40.00 44.03 8.42 -2.24 0.44PBDIT 21.54 -19.88 -2.65 -23.49 -7.79Interest 82.30 25.51 3.14 2.28 4.26PBDT -60.76 -45.39 -5.79 -25.77 -12.05Depreciation 30.35 20.30 15.27 15.22 13.77Other Written Off 0.91 0.78 0.84 1.95 2.26Profit Before Tax -92.02 -66.47 -21.90 -42.94 -28.08Extra-ordinary items -1.78 1.11 0.53 0.22 0.00PBT (Post Extra-ord Items) -93.80 -65.36 -21.37 -42.72 -28.08Tax 0.04 0.31 0.21 0.17 0.16Reported Net Profit -93.82 -65.66 -21.58 -42.89 -28.23Total Value Addition 74.29 110.37 85.34 86.70 79.42Preference Dividend 0.00 0.00 0.00 0.00 0.00Equity Dividend 0.00 0.00 0.00 0.00 0.00Corporate Dividend Tax 0.00 0.00 0.00 0.00 0.00Per share data (annualised)Shares in issue (lakhs) 333.69 333.69 333.69 333.69 333.69Earning Per Share (Rs) -28.12 -19.68 -6.47 -12.85 -8.46Equity Dividend (%) 0.00 0.00 0.00 0.00 0.00Book Value (Rs) -25.82 -45.29 -51.75 -47.98 -56.44

Source : Religare Technova

Annexure CBalance Sheet of Ashima

Section 1.01 ------------------- in Rs. Cr. -------------------

Dec '04 Mar '06 Mar '07 Mar '08 Mar '09

12 mths 15 mths 12 mths 12 mths 12 mthsSources Of FundsTotal Share Capital 53.87 53.87 53.87 53.87 53.87Equity Share Capital 33.37 33.37 33.37 33.37 33.37Share Application Money 0.00 0.00 0.00 0.00 0.00Preference Share Capital 20.50 20.50 20.50 20.50 20.50Reserves -119.51 -184.48 -206.06 -193.47 -221.71Revaluation Reserves 0.00 0.00 0.00 0.00 0.00Networth -65.64 -130.61 -152.19 -139.60 -167.84Secured Loans 508.70 541.58 541.61 447.66 450.52Unsecured Loans 83.42 28.57 26.34 23.49 22.93Total Debt 592.12 570.15 567.95 471.15 473.45Total Liabilities 526.48 439.54 415.76 331.55 305.61

Dec '04 Mar '06 Mar '07 Mar '08 Mar '09

12 mths 15 mths 12 mths 12 mths 12 mthsApplication Of FundsGross Block 480.31 328.78 317.52 318.62 307.63Less: Accum. Depreciation 228.92 20.27 33.81 68.35 79.64Net Block 251.39 308.51 283.71 250.27 227.99Capital Work in Progress 0.78 0.00 0.04 0.00 0.00Investments 55.86 33.85 36.84 36.84 33.00Inventories 60.67 55.90 51.32 44.29 39.18Sundry Debtors 162.66 13.21 13.99 14.20 18.24Cash and Bank Balance 8.97 3.48 1.31 7.03 4.61Total Current Assets 232.30 72.59 66.62 65.52 62.03Loans and Advances 23.44 57.29 55.08 10.46 10.95Fixed Deposits 6.03 4.73 4.30 0.00 0.00Total CA, Loans & Advances 261.77 134.61 126.00 75.98 72.98Deffered Credit 0.00 0.00 0.00 0.00 0.00Current Liabilities 45.42 38.80 35.27 35.38 29.80Provisions 1.16 1.56 1.73 2.72 3.09Total CL & Provisions 46.58 40.36 37.00 38.10 32.89Net Current Assets 215.19 94.25 89.00 37.88 40.09Miscellaneous Expenses 3.25 2.92 6.17 6.55 4.53Total Assets 526.47 439.53 415.76 331.54 305.61

Contingent Liabilities 309.11 293.17 258.70 258.88 259.09Book Value (Rs) -25.82 -45.29 -51.75 -47.98 -56.44

Source : Religare Technova