A PROJECT STUDY REPORT ON Training undertaken at SAGAM (INDIA) LTD “Working Capital & Ratio Analysis” In Partial fulfillment of the requirement for the award of the degree of Master of Business Administration Submitted By Submitted To Ruchika Toshniwal Mr. Tanveer Ahmed MBA Part III (2009-2011)
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Summer Training at Sangam Group(working capital management & ratio analysis)
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A
PROJECT STUDY REPORT
ON
Training undertaken at
SAGAM (INDIA) LTD
“Working Capital & Ratio Analysis” In Partial fulfillment of the requirement for the award of the degree of
Master of Business Administration
Submitted By Submitted To
Ruchika Toshniwal Mr. Tanveer Ahmed
MBA Part III
(2009-2011)
Preface
It is a matter of great Pleasure and privilege for me to Place before the
esteemed readers of this Project Report on the “Sangam (India) Ltd.” For the
year 2009-2010. This report mainly features the financial analysis of Sangam
(India) Ltd. In the Ratio Analysis interpretation form.
The Sangam (India) Ltd. Of the path of rapid and self sustaining growth. In
the Bhilwara City for this I have taken a Ratio Analysis of this Industry.
Tables and graphs are prepared to present the facts and findings in a
convenient manner.
Acknowledgement
To do anything, anywhere first of all one needs an opportunity. I am sincerely grateful to
Mr. G.C. Jain (Precident). Who provided me the opportunity to conduct my summer
training as a management student at his prestigious organization.
When I joined the company for summer training, I was a layman to textile. It was the
interest and willing co-operation of the people at the workplace without, that I might
have not been able to completely my training as smoothly and indepth as I did.
Regarding My Project I want to pay my regards to Mr. Anil Jain (V.P. Finance),
Mr.Ashok Arora (Finance), Mr. Lalit Jain (A.G.M. Accounts), for their guidance.
Finally, I want to pay my special gratitude to Mr. V.K. Bheta (R&D Manager) Mr. S.K.
Lodha (A.G.M. Marketing), Who not only motivate me but through his discuss sessions,
built a platform of knowledge about the textile industry, which is immensely helpful for
me in conducting my training and project work.
Many other persons inside and outside the organisationhelped me in doing this project,
for which I am gratful to all of them.
Last but not least, I also pay my sincere thanks and gratitude to all the staff members of
Sangam Spinners for their co-operation, which made my training informative and
knowledge enhancing.
Ruchika Toshniwal MBA Part III
Contents
Preface
Acknowledgement
Background of the study
INDIAN TEXTILE INDUSTRY
Introduction to the Sangam(India)Ltd.
OTHER VENTURES OF THE GROUP
ORGANISATIONAL STRUCTURE
THE SANGAM GROUP & IT’S UNITS
1 SANGAM SPINNERS A UNIT OF SANGAMGROUP
2 Suiting & Shirting / Weaving Unit of Sangam Group
3 Sangam Process Unit of Sangam Group
Faults in the work
Dye House Department
I.S.O. ( International Organisation for Standardization )& Quality Policy
Audit & Reserch Design And Development (R&D) Department
COMMERCIAL AND FINANCE DEPARTMENT :
Sangam Group Milestones.
Marketing Department.
Relating to Selling and Marketing
Sales Policy Ratio Analysis
SWOT Analysis
Major Finding & Conclusions & Suggestions
Major Findigs Conclusion & Suggestions
Bibliography
List of ratios
Liquidity Or Short term Solvency Ratio
Current Ratio
Quick or Liquidity Ratio
Activity or Effeciency Ratio
Inventory (Stock) Turnover ratio
Debtors (Accounts Receivable ) turnover ratio
Creditor (Payble) turnover ratio
Total Assets Turnover ratio
Fixed Assets Turnover ratio
Capital turnover Ratio
Profitability Ratios
Gross profit Ratio
Net Profit Ratio
Return on capital employed
Net Profit to total Assets ( Return on Total Assets)
Return on Equity shareholder’s fund
Earning per Equity share
Leverage / Capital Structure Ratios
Dept-Equity Ratio
Proprietory Ratio
Solvency or Debt to Total Assets Ratio
Background of the study
Summer training program is an attempt to acquaint the student with the real world
situation so that the knowledge gained from the classroom is further strengthened. In
order to fulfill this objective the faculty placed me in Sangam (India) Ltd. For a period of
forty five workinmg days and asked me to submit a report at the end of the programme.
However, at the first phase of my training I observed and understood the functional
procedures of various departments of the organization and in the second phase I was
assigned a project which included the interpretation of the balancesheet of the company
and his Ratio Analysis.
This report consist of two parts.
Part A : Deals with the organizational aspect I.e.background of the group,
backfround of the company, functional procedure of the various
departments.
Part B : Deals with study title “Ratio Analysis of Sangam (India) Ltd.”
Introduction To The Indian Textile Industry
The term textile derived form the latin word texture (to weave) originally applied
only to woven fabrics has now become a general term for fabric, yarns and other material
that can be made into fabrics and for fabrics produced by interlacing or any other
construction method. Threads, cards repes, braids, lace, embroidery,nets and fabrics
made by weaving, knitting bonding, felting or tufting are textile.
The textile industry although highly developed as a craft remained essentially a cottage
industry until the 18th century. Although the textile grew and flourished especially during
the middle ages not until the industrial revolution, did it undergo remarkable expression.
It helped to transform the industry into significant of international trade and rational
economy. The scienticif and techonological advances of the 19th and 20
th centuries
improved manufacturing elements and increased the volume and quantity of production,
loweing prices of finished cloth and garments.
In the 20th century, with the development of electonics and computer, now physical
engineering concepts were employed in textile research and development.
An application of science to the textile industry introduced man made fibers. Now both
industrialized and developing countries have modern installation capable of highly
efficient fabric’s production.
INDIAN TEXTILE INDUSTRY
India woud realize its offer to the Prime share of the projected increase in the world trade
in the post –GATT era if there is a substantial growth in its agriculture and textile
sectore. It is very simple to appreciate this.
It is estimated that the largest increase in furthure world trade be in the clothing sectore –
up by prehasps 60% and in the agriculture –up perhaps 20%. In india textile industry hold
the key and have emerged as the foremost net-foreign exchange earner accounting for
34% of India’s total export during 2001-2002. India is ranked 14th in the list of leading
exporters of textiles. Its share in export of textile and clothing in the international market
has been covering around 2.6 %. The import content of textile products is almost
insignificant as compared to the items like engineering goods, gems and jewekary etc.
The textile industry occupies a special niche in the indian ecomon. Synthetics constitutre
close to 40% the indian textile industry. Significantly , the textile sectore is a noteworth
contributor to the indian ecomony-4% of GDP 35% to gross exportearning.
INDIAN TEXTILE CAPACITY & CAPITAL AVAILABILITY.
According to the survey report by AIFCOSPIN the no. of unorganized small scale
spinning units was 900, having 25 lacs spindles, 25500 rotors and annual yarn production
of 250 million Kg., The count configuration varying form 6s to 40s. these units are
mostely located at Tamil Nadu., Haryana, U.P., M.P. and Rajasthan.
Introduction to the Sangam(India)Ltd.
General Information : Name of the Company : Sangam (India) Ltd.
Constitution : Public Limited Company
Date of Incorporation : 29.12.1984
Date of Commencement of Business : 02.05.1985
Location of Registered Office : Pur Road, Bhilwara
Location of Factory/Shop/Principal : (1) Vill Billiya, Chittor Road,
Place of Business (2) Vill Atun, Chittor Road,
Group to which the borrower belongs : Sangam
No. of person employed : Approximate 2500
Groth story
Installed Capacity (Product Wise)
2006 2007 2008 2009 2010
Looms 172 172 178 257 257
Spindles 36288 48384 177320 193920 193920
Production
Product 2006 2007 2008 2009 2010
Yarn(in MTs) 13844 41238 38280 33266 46553
Fabrics(Lac Met.) 56.51 60.79 57.56 57.58 60.72
Brief Background of the Company
Sangam (India) Limited (SIL), Flagship company of the SANGAM GROUP, was
promoted under the name and style of Arun Syntetics Pvt. Ltd. With annual turn over 200
crore(Rs.). The group had its humble begnings in 1984 with a weaving unit consisting of
only eight looms and in a short span of Little more than a decade multiplied its weaving
capacity. The weaving capacity was gradually increased by installation of additional
looms and the merger of two closely held profit making companies in the 1995 took the
weaving capacity to 98.83 lac meters per annum. The company took a strategic decision
to intergrate backward and made a sucessful entry spinning in 1995 by installing 17280
spindles for manufacturing of PV dyed yarn and it gave the company the volunes,
margins and cash surplus which have enabled to embark on a path of rapid and self
sustaining growth.
The company has production faility located at Bhilwara and Mandapam. The Company
manufactures man Made Syntetic Fibre Yarn and Blended Suitings. PV yarn is used in
Suiting, shirting, and dress-material and knotted fabric and has been steadily gaining
market share in the blended yarn segments. Polyster spun yarn is used for stitching and in
industrial fabrics. In case of fabric manufacturing, the finished yarn forms the input and
depending upon the type of fabric to be woven is fed on the different types of looms. The
designs and the colour combinations and number of picks etc. are decided on the basis of
market feed back.
At present SIL have 48384 spindles for dyed PV yarn installed at Village Billia Kalan,
Hamirgarh Road, Bhilwara. The weaving division has 116 Looms installed at Village
Atun, Hamirgarh Road. Both the Plants arewell located in terms of basic infrastructure.
The proposed expansion project is also to be implemented at the same site. After the
implementation of proposed expansion project, at the land adjacent to he exusting site of
its Spinning Division total spindlage in the Spinning division will be 62784.
Today the Company is one of the largest Producers of PV Synthetic dyed yarn in the
country and is reckoned as market leader in PV dyed yarn activity. Its country and is
reckoned as market leader in PV dyed yarn activity. Its spinning division is ISO 9002
accredited. It offers the largest rang in colour and shades. SIL’s products are sold under
the popular “SANGAM” brand name. Its fabric is marketed through a network of 500
dealers and retailers with strong presence in UP, Bihar and Southern India.
OTHER VENTURES OF THE GROUP
SPBL Limited
The Other group of SANGAM GROUP was formed in 1984 to underke Fabric
Processing Operation. The present capacity of processing of all kind of fabric is 25
Million per annum. The company later on embarked upon a new project for
manufacturing furnishing fabric and Dress Materials namely Flock Faric (American
Velvet) with a total outlay of Rs.2500 Lacs. The Project was set with an insalled capacity
of 37.5 Lac meters of flock fabrics per annum. Most of the Plant and machinery and
technical know-how have been imported into the country form U.K.
Hospital:
Shri RP Soni, Founder of the group has also activity been associated with various Social
activity and Institutions. A well-equipped Hospital is run in a Trust named after his
respected and beloved mother Late Smt. Kesar Bai Soni since Last 10 years.
Smt. Kesar Bai Soni Hospital is well known in the Textile City of Bhilwara, Rajasthan
for it’s noble work in the field of healthcare to the under privileged since 1993.After
sucessful completion of ten years in the field of healthcare, Smt. Kesar bai Soni
Charitable Yrust, has to decided to modernized the existing Hospital and shift it
to a new spacious and well equipped Building.
Institute of Technology and Management
Recently considering the problem of Techical education in the Region, Shri Soni has
decided to set up an Engineering College under a Trust founded in the Memory of his
Respected and beloved Father Late Shri Badri Lal Soni.
With a view to provide the Technical and Management education to the youths of the
Region an Institute of Technology and Management has been constucted in the
Bhilwara City under Trust. The Institute offers Engineering and management course. The
institute has got the approval of AICTE.
ORGANISATIONAL STRUCTURE
Board of Directors
Name of Director Position
Shri Ram Pal Soni Chairman
Shri S.N. Modani MD
Shri T.R. Bajalia Directore
Shri G.K. Chapparwala Director
Shri Ramavatar Jaju Director
Management Team
Shri G.C. Jain President
Shri S.M. Gupta President (Works)
Shri M.K.Palaria Company Secratory
Shri S.K. Ladha Marketing Manager
Shri V.K. Bhatt D.G.M. (R&D)
Shri Anil Jain Vice President
AUDITORS - M/S R. KABRA & CO. MUMBAI
M/S B.L. CHORDIA & CO. BHILWARA
BANKERS - STATE BANK OF INDIA
THE BANK OF RAJASTHAN
ICICI BANK LTD.
DENA BANK
THE SANGAM GROUP & IT’S UNITS
Sangam Spinners :- Manufacturing Of P/V Yarn having ISO 9002
Certification. It have also Manufacturer of Power for
captive consumption.There is thurmal power plant.
Sangam Suiting :-Manufacturing the synthetic Fabrics.
Sangam Processing :- Processer of synthetic Fabrics.
SANGAM SPINNERS A UNIT OF SANGAMGROUP
Function of Various Departments.
The Various departments at Sangam (India) Limited’s unit of spinning Mill has as
follows.
1. Personnel and Administration Department.
2. Production Department.
3. Commercial and Finance Department
4. Marketing and Salse Department.
Personnel and Administration Department:
The General Manager (Personnel) Looks after all the Personnel, legal and secretarial
matter of the company. He reports to the Executive Directors through President.
Reporting to him are the Factory Manager, Labour Officers, Security Officers, and Legal
Advisers.Some of the functions carried out by the Personnel and Administration
Department are:
(1) Recruitment & Selection:
Sangam Spinning Mills Ltd. has got its own recruitment, Selection and Training system.
The recruitment and selection of technical personnel and managers is made through
placing advertisement in leading Newspaper,and Personal contact .
(2) Working:
There are three shifts in a day the first shift starts in the morning (i.e.) All the labour laws
like P.F., E.S.I, Minimum Wages Act, Payment of wages Act, Apprentic Act and all
other Acts related to the industry are taken care of. At present there are about 2000
labour 200 tranee labour and there is contract labour is 500 and administration staff is
290 member. The shift timing is 7 a.m. to 3p.m. and 3p.m. to 11 p.m. and 11p.m. to 7a.m.
and the lunchtime of the worker is half an hour in day. Techniqual jurnal shift 8 a.m. to
5p.m. and commercial staff 9.30 a.m. to 6.30 p.m.
(3) Regular Performance Appraisal is done.
(4) Human Relation :- In the largre family of “SANGAM” there are 2500 more
than and they must keep very cordination and fruitful relationship with each other
and they should always work togather like a good team.
Production Department:
This department is divided into two separate departments.
(1) Spinning Department
(2) Suiting & Shrting/ Weaving Department
(3) Processing Department
Spinning work is done in the separate (unit ) Sangam Spinners, Bhilwara. And the
Weaving Work is done in another (unit) Mill, Sangam Weaving, Bhilwara.
(1) Spinning Department :
Spinning Department is headded by vice precident (spinning). He is assist by production
Engineers and other Personnel’s is the various processes which comes under the spinning
department are as follows:
Ring Fram * No.of Spindles * Production = Total Production Per day
110 * 576 * =(63360) *1.21Kgs/spindles per day = 76 Tone Production per day.
(a) Raw-Material:
The Common raw material used in the spinning is polyester, Viscose. These are received
in the form of balses in the gray and dyed condition. In this the proportation of the
mixture is (35% Viscose + 65% Polyester). And the Polyester is from Relienc Industry
and the Viscose is from Grasim Industry .They are used Polyester are of three type (1)
Gray,(2) TBL, (3) Black and the Viscouse is dyed.
(b) Mixing / Blending :
Fibre in the requisite ratio are taken, opened and blended in the mixing blenders. During
this process water and anti static agents are sprayed on the fibres. In greay type mixing
colour are also mixed in the spraying solution to provide identification of the mixing. The
mixed material is toppled once or twice it ensures proper blending of the fibres.
Blow Room :
The mixing is again opened to remove the waste by mixing the tough size is reduced and
better blending of the fibre is achived. The mixing is converted into laps to be fed into the
card. There are two type of feeding first is lap feeding and secound is aero feeding and in
the aero feeding is the latest technology.
(c) Carding :
The feeding the lap or in the opened stage fibre are individual as hasrd chips, short fibre
and entanglements are removed in the form of dropping, fly and flat strip respectively. In
the out put of 8 drum is going to draw frame and form the draw frame same as out put of
drum going to Rsb and then one out put drum going to Simplex.
(d) Draw Frame/RSB :
The draw frame sliver is subjected to doubling and drafting process to parallise these
fibre and the products in uniform sliver.
(e) Simplex / Speed Frame :
The draw frame sliver is drafted slightly, twisted and wound on speed frame bobbin and
robim this is 750 Gram. for the formation of the roving.
(f) Ring Frame :
The Ring Frame is the main part of the spinning in the in spinning of roving onto yarn of
required count and twist is done here at this stage.
(g) Finishing : In the finishing deopartment it is divided into these sub
divisions.
(1) Auto Coner/winding :
Defects present the yarn is cleared by using electronic gauges and the cleared yarn is
wound in cones.
(2) Cheese Winding :
Two or more yarns are required for playing are wound are cheeses.
(3) TFO (Two For One)/ Doubling :
In doubling twist is impated to the yarn wound on the cheese here the doubling defects
are removed from the yarn.
(I) Packing :
After thorough checking all the cones are packed in cartoons or bags as per process and
sent to the yarn godown. These are stored in the store romm on the humdity at +0.96
Steem.
Warehouse :-
Warehouse department prepares the challan according to the order paced by the sales
department. This bill is sent to the account officer for filling, side by side the yarn and
fabric is packed and made ready for dispatch. Rest of the material is stored either in
packed form or in loose form in the warehouse.
There is of two type of warehouse (1) Storage department in this department the raw
material is stored. (2) warehouse in this the finished product is stored and pack in the 65
Kg. Of polythene Bage In the Production they are using FIFO(First in first out method)
for raw material.
Suiting & Shirting / Weaving Unit of Sangam Group
This seperate unit of sangam. That is Sangam Weaving /Suiting & Shirting unit of
Sangam (India) Ltd. The various Process that come under the weaving department are as
follows. There is approximat 230 labour and 200 staff members work in this unit.
(1) Warping :
It is as per the Programme given by the design and development department after
the approval of the marketing departmen. The cones that are receving form the
spinning mill are fed on the creeds as per pattern and design and then warped and
beamed the weaver’s beam.
(2) Sizing:Yarns required sizing or deaming is first warped and then fed into the
sizing machine that produces weaver’s beam as per requirement.
(3) Drawing in :
All the warped into the weavers beam are to be passed through held eyes belonging
to different heald frames (as per design) and then through deuts of reeds to give
proper structure to the fabric to be woven as per particular supplied by design and
development department.
(4) Knotting/Warp tyeing :In the case of repeated design all the ends of running
out beam are typed to the corresponding ends of each fresh beam on looms or
away from the loom.
(5) Pin Dropping :
To stop the loom in case of wrap end break, each ends is provided with a drop pin.
This spinning can be done either on the loop or aways form the loom.
(6) Looms:
Drawn beams are gaited on looms for which it is meant and these looms are
controlled to weave fabrics of required particulars. In case of shuttle less loom, the
weft yarn is supplied in the form of cones only,
whereas incase of shuttle looms the weft yarn is first wound into the pin
windingand then fed into the battery of the loom the fabric is woven by the
interlacement of warp and weft threads in the given sequence and wound on the
fabric rolls.
(7) Mending Department :
Woven fabrics is dofted from the loom on the fabric rolls and is inspected,
measured, mended and again re-inspected in this department.
Sangam Process Unit of Sangam Group
This is the seperat unit of sangam group in this unit is doing the work after the work of
sangam weaving is finished .
(1) Gray Department :-
In this department the material is unloaded by the weaving unit of sangam or many other
weaving company like .Shrisiyaram, Ajay Textile, Nillu Textile, M.P. Sulzer.
(a) Fibre Dyed :- goes to scauring
(b) Piece dyed :- * 100% polyester
* Polyester + Viscouse
Scauring:- From there the fabric goes to Singing Burn
Singing Burn :- In the Singing Burn the produced fabrics goes between the two flams
on both side of fabric of LPG gas . This process becouse of the fiber of the fabric are
burn (finish the rufghness) and the fabric is becom smooth and plain.
Zambo Jigger :- This machin is used for the dyed fibre for washing the fabric .this is
so big so that it’s capacity is also more than Jigger machines they are also do same work.
Dry Range:- In dry rang duration is set on it on the heat setting is 2100
temp. Becouse
after that when the fabric is dyed on the temp. of 1400
then no defet is show on the fabric
no effect on the fabric of 140 degree temp. now when the fabric dry rang then the coldair
is sprade over it so that the fabric is frzee on the 210degrss temp. These machines are of
vertical shap becouse they are save the spac of the factory.
Dye Machine:- They are of two type.
(a) Dye machine :The fabric go in the dye machine by airfeed these machines are
in the (U) shape machine becouse these type of shap is save the space of the
factory.And then the fabric dyed then it again wash on the Jigger and then again
goes on the dry rang.
(b) Bim dyeing : In this ther is a bim that has many hools over it and then the fabric
is dressed on it and then the liqure is goes in the dim and over the bim.
Stenter :- Then the fabric goes over it It set the width like Incress & Decrees the width
of the fabric.and set the temprature of the fabric.
Spoting :- For chacking the spot like some spots of temperary nature they are washed
by the two persons with the detergent and anti spot agent.
These machine are used according to the demand of customer:
Open Dacatisind Machine, Rotary Machine:- These machine for the shyning in the cloth
and bulkiness in the cloth and the demand of the customer.
Packing : In the last when all the work is finished then the packing is done
Different Process in folding are as follows,
1 Grading: Detection of faults & grading according to the severity of faults.
2 Folding: Folding of fabrics on hard paper boards.
3 Tagging: Tagging the plastic cover for writing specifications.
Faults in the work
1 There are these types of faults at the time of Spinning they are:-
Yarn patta, due to different count or colour.
Slub-thick yarn in warp and weft.
2 There are these types of faults at the time of Weaving faults in fabric :-