Amit pandey


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Report on Working Capital Management..................

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Amit pandey

  1. 1. MVM Handicrafts Pvt. Ltd. WORKING CAPITAL MANAGEMENT Of BY: AMIT KUMAR PANDEY Roll No: 0921270007 Summer Training Project Presentation on
  2. 2. INDUSTRY PROFILE <ul><li>Handicrafts/Kitchenware retailing is one such sector within the overall retail segment, which has been in the limelight recently. Modern retail in this sector is emerging to cater to the diverse needs of the customer–be it convenience, fashion or price. </li></ul><ul><li>In a traditional Indian home, the need for kitchenware items is purpose-driven. Even till the early eighties, kitchenware in the average Indian home would constitute primarily copper, aluminum and stainless steel </li></ul>
  3. 3. INDUSTRY PROFILE <ul><li>The cookware segment accounts for nearly 63% of the house ware market. With the development of the other segments, this percentage could gradually come down. Pressure-cookers, non-stick cookware, stainless steel cooking vessels, woks and other metal ware are the main product categories in the cookware segment </li></ul><ul><li>Kitchenware market in India is still very much driven by purely functional requirements and there is a huge scope for market expansion. The future trends in this market can be seen in the form of  kitchenware products and kitchenware retail formats </li></ul>
  4. 4. COMPANY PROFILE <ul><li>M VM Handicrafts is one of India's leading companies, involved in manufacturing and exporting of fine quality stainless steel products, offering a wide spectrum of products from Décor to barware, tableware, kitchenware and other utility products. With a modest beginning, we have today emerged ourselves as a reputed exporter of stainless steel kitchenware from India </li></ul><ul><li>Our regular comprehensive industry experiences have developed the knowledge and Understanding of market trends. Thus, we have been developing new designs ahead of the emerging trend. Since inception, we have always worked towards maintaining superior quality standards for all our products to ensure customer experiences satisfaction. </li></ul>
  5. 5. COMPANY PROFILE <ul><li>Their manufacturing unit has a separate department involved in product innovation and creating new designs. Along with the new products being developed at our end we also customize the products for our clients. This department works in consultation with the clients so as to reproduce the clients’ idea in form of the product. </li></ul>
  6. 6. RESEARCH METHODOLOGY <ul><li>Research methodology may be treated as the heart of the project without a proper and well organized research plan it is impossible to complete the project and draw conclusions and get results. </li></ul><ul><li>Research methodology deals with the type of methodology used, the problem of the study formularized, hypothesis, assessment tools of used .The methodology was designed taking into consideration the objectives of the study. </li></ul>
  7. 7. SOURCES OF DATA <ul><li>SECONDARY DATA: </li></ul><ul><li>Secondary data are those, which have already been collected by someone else and have already been passed through the statistical process. </li></ul><ul><li>Annual Reports </li></ul><ul><li>Books </li></ul><ul><li>Websites </li></ul><ul><li>Magazines </li></ul><ul><li>Files </li></ul>
  8. 8. DATA ANALYSIS <ul><li>1. Current Ratio : It is the most common and popular measure of studying the liquidity of a firm. It is calculated as follows: </li></ul><ul><li>Current Ratio = Current Assets </li></ul><ul><li>Current Liabilities </li></ul>
  9. 9. <ul><li>2. Quick Ratio: This ratio establishes the relationship between quick/ liquid current assets and the current liabilities. </li></ul><ul><li>Quick/ liquid Ratio = Quick Assets </li></ul><ul><li>Current Liabilities </li></ul>
  10. 10. 3. Absolute Liquidity Ratio: = Cash in hand & at Bank + Marketable Securities Total Current Liabilities
  11. 11. 4. Working Capital Turnover Ratio: Working Capital Turnover Ratio = Sales Working Capital
  12. 12. CONCLUSION <ul><li>Some of Conclusion that can be drawn from the study done, the working capital position of MVM are – </li></ul><ul><li>MVM should increase the short-term investment. The composition of marketable securities in total current assets is almost negligent which could be increased by financing them, which in turn will increase the working capital substantially and the liquidity position will be much higher than it is now as they can be converted into cash as and when required. </li></ul><ul><li>Their Net Working Capital in the year 2010 is less as compared to the year 2009. In order to bring it to the satisfactory level, the company should decrease their liabilities and should increase their current assets. </li></ul><ul><li>Net profit Ratio of the firm is increasing, which states that the firm increased the period in which its raw materials are converted into finished goods. </li></ul>
  13. 13. CONCLUSION <ul><li>Current ratio of the firm is in decreasing trend, which states that the firm is able to collect its debtors more promptly as compared to the previous year. Because ideal current ratio is 2:1. </li></ul><ul><li>Gross profit Ratio of the firm is increasing, which states that the firm decreased the period of collection from Debtors. </li></ul><ul><li>Working Capital Turnover Ratio is decreased of 2010 in compression to 2009. </li></ul><ul><li>Quick Ratio of 2010 is high in compression to 2009, because ideal quick ratio is 1:1. </li></ul>
  14. 14. RECOMMENDATIONS & SUGGESTIONS <ul><li>Following are few recommendations given to the company in achieving its desired objectives: </li></ul><ul><li>In order to decrease the current liability company needs to improve their cash Management, Inventory Management, Receivables Management etc. </li></ul><ul><li>The business runs successfully with adequate amount of the working capital but the company should see to it that the cash should not be tied up in excessive amount of working capital. </li></ul><ul><li>Though the present collection system is near perfect, the company as due to the increasing sales should adopt more effective measures so as to counter the threat of bad debts. </li></ul><ul><li>The over purchasing function should be avoided as it could lead to liquidity problems. </li></ul><ul><li>The investment of cash in marketable securities should be increased, as it is very profitable for the company. </li></ul><ul><li>Holding of excessive and insufficient stock must be avoided as it creates a burden on the cash resources of a business and results in lost sales, delays for customers, etc respectively. </li></ul>
  15. 15. LIMITATION OF THE STUDY <ul><li>TIME CONSTRAINTS : </li></ul><ul><li>Time was major limiting factor of the study. Due to this all the employees could not be taken into consideration. </li></ul><ul><li>UNAVAILABILITY OF THE RESPONDENTS </li></ul><ul><li>Many employees were unable due to nature of work i.e. busy schedule. </li></ul>
  16. 16. BIBLIOGRAPHY <ul><li>Following sources have been sought for the preparation of this report: </li></ul><ul><li>1-Corporate Intranet </li></ul><ul><li>2-Financial Statements (Annual Reports) </li></ul><ul><li>3-Direct interaction with the employees of the company </li></ul><ul><li>4-Internet </li></ul><ul><li>5-Textbooks on financial management – </li></ul><ul><li>I.M.Pandey </li></ul><ul><li>Khan and Jain </li></ul>