A COMPREHENSIVE PROJECT ON “A Comparative Study on the Financial Performance of Cement Industry” Submitted to Anand Institute of Management IN PARTIAL FULFILLMENT OF THE REQUIREMENT OF THE AWARD FOR THE DEGREE OF MASTER OF BUSINESS ASMINISTRATION In Gujarat Technological University UNDER THE GUIDANCE OF Faculty Guide Krishna Gor Assistant Prof. Submitted byJaynand Patalia Rupesh VasavaEnrollment No.:107020592058 Enrollment No.:107020592056 MBA SEMESTER III/IV Anand Institute of Management MBA PROGRAMME Affiliated to Gujarat Technological University Ahmedabad December, 2011
TABLE OF CONTENTSPREFACEACKNOWLEDGEMENTDECLARATIONEXECUTIVE SUMMARYSR. NO. PARTICULAR PAGE NO. PART – I INDUSTRY STUDY1. OVERVIEW OF CEMENT INDUSTRY 12. PRODUCT PROFILE `53. DEMAND DETERMINATION 94. PLAYERS IN THE INDUSTRY 125. DISTRIBUTION CHANNELS 146. KEY ISSUES AND CURRENT TRENDS 157. LITERATURE REVIEW 188. OBJECTIVES OF THE STUDY 199. PESTEL ANALYSIS OF THE INDUSTRY 2110. PORTERS FIVE FORCE MODEL 23 PART – II COMPANY STUDY11. OVERVIEW OF THE COMPANIES 2412. PRODUCT PROFILE 3313. FINANCIAL ANALYSIS 3414. SWOT ANALYSIS OF AMBUJA CEMENT 4415. SWOT ANALYSIS OF BINANI CEMENT 4516. COMPARATIVE ANALYSIS OF THE COMPANIES 4717. FINDINGS AND CONCLUSIONS 61ANNEXTURESBBILIOGRAPHY
PREFACE“Experience is the best teacher.” This saying plays a guiding line in our lives andalso in project reports that are an integral part of the MBA programmed in Gujarattechnological University.Today’s age is an age of management. Management is the backbone of anyorganization or any activity done. The real success of management lies in applyingthe professional management techniques an all managerial activities.Hence, to attain this objective and to have the outlook of performance of the cementindustry and to analyze the emerging trends of the same in Indian Economy we haveundertaken the Comprehensive Project on “A Comparative Analysis of theFinancial Performance of the Cement Industry”.
ACKNOWLEDGEMENTNothing concrete can be achieved without an optimal combination ofinspiration and perspiration. No work can be accomplished without taking theguidance of the import. It is only the critiques for the ingenious intellectualthat helps transform a product into a quality product.A project is a major milestone during the study period of a student. As such thisproject was a challenge to us and was an opportunity to prove our caliber. It wouldnot have been possible to see through the undertaken project without the guidanceof Prof. KRISHNA GOR. It was purely on the basis of her experience andknowledge that we were able to clear all the theoretical and technical hurdles duringthe development phases of this project work.I even show my gratitude towards Dr. N.N. Patel, Director, AIM, ANAND and myfaculty guide Prof Krishna Gor without whose support my project would not bepossible to complete.I have been able to prepare my report successfully and I acknowledge a specialthanks to all those people without whose support it was impossible for me to makethe project report.
DECLARATIONWe, JAYNAND PATALIA AND RUPESH VASAVA, hereby declare that theReport for Comprehensive Project entitled“A COMPARATIVE ANALYSIS OF FINANCIAL PERFORMANCE OF CEMENTINDUSTRY WITH SPECIAL REFRENCE”Is a result of our own work and our indebtedness to other work publicationsReferences, if any, have been duly acknowledged.Place:Date: JAYNAND PATALIA RUPESH VASAVA
EXECUTIVE SUMMARYThe title of the comprehensive project is “A Comparative Analysis of FinancialPerformance of Cement Industry”. Comparative analysis study helps indetermining the various financial studies of the companies. Comparative studyshows the relation between the companies as well as relation between the variousindustries of the economy.Thus, we selected this title for the comparative study of companies in cementindustry. We have selected the following two companies for the study of thecomparative analysis of financial performance of the cement industry in India. 1) AMBUJA CEMENT LTD. 2) BINANI CEMENT LTD.The companies have been chosen based on market share, production capacity andnet profits for the previous years. Both the companies are the leading producer in thecement industry in India.The cement industry is the leading industry in India which is having a very highgrowth rate. Cement Industry of India is the world’s second largest producer ofcement products after China. Thus, Indian cement industries in India have a veryhigh growth rate and it contributes very high percentage to the GDP of IndianEconomy.
LIST OF TABLESSr. No. PARTICULARS TABLE NO. PAGE NO.1. GROWTH OF CEMENT 1 4 DEMAND2. DEMAND DETERMINATION 2 103. MAJOR PLAYERS IN NORTH 3 124. MAJOR PLAYERS IN SOUTH 4 13 RATIOS ANALYSIS5. OPERATING PROFIT MARGIN 5 346. GROSS PROFIT MARGIN 6 357. NET PROFIT MARGIN 7 358. CURRENT RATIO 8 369. QUICK RATIO 9 3610. DEBT EQUITY RATIO 10 3711. INVENTORY TURNOVER RATIO 11 3812. DEBTORS TURNOVER RATIO 12 3813. ASSET TURNOVER RATIO 13 39 DUPONT ANALYSIS14. AMBUJA CEMENT 14 4015. BINANI CEMENT 15 42 COMPARATIVE ANALYSIS16. RETURN ON NET ASSET 16 4717. RETURN ON EQUITY 17 4818. RETURN ON PROFIT MARGIN 18 4919. FINANCIAL LEVERAGE (I/S) 19 5020. FINANICIAL LEVERAGE (B/S) 20 5121. RATIO ANALYSIS 21 52,53,54,55,56, 57,58,59,60
LIST OF GRAPHSSr. No. PARTICULARS GRAPH NO. PAGE NO.1. PROCESS WISE 1 82. DEMAND DETERMINATION 2 103. CAPCITY DISTRIBUTION 3 114. MAJOR PLAYERS IN NORTH 4 125. MAJOR PLAYERS IN SOUTH 5 13 COMPARATIVE ANALYSIS6. RETURN ON NET ASSETS 6 477. RETURN ON EQUITY 7 488. RETURN ON PROFIT MARGIN 8 499. FINANCIAL LEVERAGE (I/S) 9 5010. FINANCIAL LEVERAGE (B/S) 10 5111. GROSS PROFIT MARGIN 11 5212. OPERATING PROFIT MARGIN 12 5313 NET PROFIT MARGIN 13 5414. CURRENT RATIO 14 5515. QUICK RATIO 15 5616. DEBT EQUITY RATIO 16 5717. INVENTORY TURNOVER RATIO 17 5818. DEBTORS TURNOVER RATIO 18 5919. ASSETS TURNOVER RATIO 19 60 LIST OF DIAGRAMS
Sr. No. PARTICULARS DIAGRAM NO. PAGE NO.1. CEMENT MANUFACTURING 1 7 PROCESS2. PORTER’S FIVE FORCE MODEL 2 233. DUPONT ANALYSIS(AMBUJA 3 41 CEMENT)4. DUPONT ANALYSIS(BINANI 4 43 CEMENT)