A project report on working capital management of shree dayal tours & travels pvt ltd

WORKING CAPITAL MANAGEMENT OF SHREE DAYAL TOURS & TRAVELS PVT LTD

SL.NO. CONTENTS PAGE NO.

1 CHAPTER 1

EXECUTIVE SUMMERY 3 TO 7

• INDUSTRY PROFILE.
• COMPANY PROFILE
• NEED FOR STUDY
• OBJECTIVE OF THE STUDY
• RESERCH METHDOLOGY
• FINDING
• SUGGESTION
• CONCLUSION
2 CHAPTER 2
8 TO 14
INTRODUCTION OF INDUSTRY

INDUSTRY PROFILE

3 CHAPTER 3
15 TO 34
INTRODUCTION OF COMPANY

• COMPANY PROFILE
• VISION, MISSION AND GOAL.
• BOARD OF DIRECORS.
• OBJETIVE OF SDT&TPL.
• PRODUCT & SERVICE PROFILE
• ORGANIZATION FLOW CHART OF SDT&TPL.
• DEPARTMENT STUDIES OF SDT&TPL

4 CHAPTER 4
35 TO 39
RESEARCH METHDOLOGY

• SCOPE OF STUDIES.
• OBJECTIVE OF STUDIES
• METHDOLOGY

Babasabpatilfreepptmba.com 1


CHAPTER 5
5 WORKING CAPITAL MANAGEMENT 40 TO 52

• INTRODUCTION
• MEANIG OF CAPITAL.
• FORM OF CAPITAL
• MEANING OF WORKING CAPITAL
• NEED OF WORKING CAPITAL
• NATURE OF WORKING CAPITAL
• FACTORS DETERMINING WORKING CAPITAL
REQUIREMENTS.
• FINANCING OF WORKING CAPITAL
• WORKING CAPITAL COMPOSITION.

6 CHAPTER 6
53 TO 70
DATA ANANLYSIS AND INTERPRETATION

7 CHAPTER 7
• FINDINGS 71TO 77
• SUGGESTIONS
• CONCLUSIONS
ANNEXURE
BALANCE SHEET

BIBLOGROPHY



EXECUTIVE SUMMARY
TITLE OF THE PROJECT

“WORKING CAPITAL MANAGEMENT”
Organization: SHREE DAYAL TOURS & TRAVELS PRIVATE LIMITED.

INDUSTRY PROFILE:-
In the 3500 BC fixed wheel chart are invented first wheel vehicles in
history .Other early wheel vehicles included the carious. The wheel vehicles were used for
the traveling purpose. Littleton area first began to be settled in 1862, there were two principal
forms of transportation available: walking and either riding or being pulled by a horse. There
were no roads to speak of, only old Indian trails which had been widened and packed hard
by the increased usage of white men. Their after in air India has came in 19 th century. Air
Indian has first Government sector company in India .It was introduced long year ago in
India And there after many private air lines comes in India .The airlines has developing the
service sector in India by providing tours and traveling facility to the customer. In 19 th
century many tours & Travels Company introduce in India. Air Deccan is continues to be one
of the faster growing commercial passenger airlines today .Air Deccan company has
developed tours & travels sectors to provide various facility to the tours & travels facility
company.
Company profile:-

SHREE DAYAL TOURS & TRAVELS PRIVATE LIMITED (SDT&TPL) is situated
at Makwana Road Andheri (East) in Mumbai; State – Maharashtra .Shree Dayal Tours &
Travels Pvt Ltd is a medium scale of Tours & Travels service providing company. Shree
Dayal Tours & Travels Pvt Ltd was incorporated in the year 2001. Shree Dayal Tours &
Travels Pvt Ltd was set up in the year of 2001, 17 August. The Registration number is U
63040 MH 2001 PTC 133094. The registered office of the company will be situated in the
state of Maharashtra i.e. within the jurisdiction of registrar of companies at Mumbai. Shree
Dayal is a Tours & Travels company. I have undertaken my study in area of working capital



in order to get the basic understanding and information regarding the tours & traveling
company.

• Objectives of the study:
To study the working capital requirement of a company.
To know the progress of working capital in a company

To study the efficiency of cash, and receivables management of the company
To know the solvency of the company & how the company is managing working
capital.
The objective of study to analyzed the liquidity position of the company.

THE WORKING CAPITAL NEED ARISES FOR THE FOLLOWING PURPOSE.
• For purchasing of Tickets.
• For paying wages and salaries
• To increase day-to-day expense and overhead costs like power and office expense etc.
• To meet selling costs of packages, advertising etc…
• To provide credit facilities to customers.

• SCOPE FOR THE STUDY:-
This project acts as a reference guide or as a source of information. It gives the
idea about the financial analysis and working capital of the firm. The main scope of the
study was to put into practical the theoretical aspect of the study into real life work
experience. The study deals with analysis and interpretation of the data collected through
the sources of primary and secondary data for a period of five financial years. I.e. 2004-
2005, 2005-2006, 2006-2007, 2007-2008 and 2008-2009 Graphs, diagrams and tabulation
methods are used to analyze and interpret the data collected. It will help to understand the
company’s liquidity position.



LIMITATION OF THE STUDY
• This study deals only with the data made available. Hence the result of this study
cannot judge the business of the firm in general
• The study have been influenced by the limitation of the ratio analysis
• The study extensively uses the data provided is the financial reports of the firm which
may also have their own limited perspective
• The analysis made on the working capital management is for a particular period of
time the current assets and current liabilities will change for an analysis made at any
other of time.

• METHODOLOGY:

. In preparing of project the information collected from the two sources.

 Primary Sources:
Primary sources include information collected through discussion with the concerned
departmental persons i.e. Mr. Parihar and Mr. Manoj.R

 Secondary Sources:
I was used secondary sources also for collecting the data. They are:
• Information from the text sources
• Information form the internet sources
•Information from the materials provided by the concern

SAMPLING DESIGN
0 Sampling unit : Financial Statements
1 Sampling Size :Last five years financial statements

• Finding and Suggestion:
Finding:-



 The net working capital has declined in the year 2007-2008 and but the profit of the
company was increased in the year 2007-2008

 The Shree dayal tours & Travels Pvt Ltd has abled to repay the liability & loan of the
creditors or not.

Suggestion:-
 In the year 2007-2008 the current assets of the Shree Dayal tours and travels Pvt Ltd has
declined and current liability of the company has increases there for the net working capital
declined. There for the current ratio has declined. The net working capital of the company
has increased remaining year .But profit has increased because the sales has increased in the
year 2007-2008.

 The company has abled to repay the liability of the creditors because of the current
ratio of SDT&TPL is above the standard of current ratio i.e. 2:1. The profit of the
company has increased every year.

• Conclusion:-
The Shree Dayal tours & travels Pvt Ltd has profit orient company and
company has to able to the repay of his lability.The company have sufficient reserve and
surplus and reserve and surplus has increases every year. After going through the
different aspects of the industry departments and the awards it has received in different
fields. There is good relationship between the directors and employee. The management
concerned about employees complete health and wealth.



 INDUSTRY PROFILE.



INDUSTRY PROFILE
.

HISTORY:-

Littleton area first began to be settled in 1862, there were two principal forms of
transportation available: walking and either riding or being pulled by a horse. There were no
roads to speak of, only old Indian trails which had been widened and packed hard by the
increased usage of white men. This did not change for nearly a decade. As farfetched as it may
sound, the early South Platte valley settlements had a legacy of steamboat travel. The Rocky
Mountain News regularly published the arrivals and departures of various river boats, and saw
to it that major east coast newspapers reprinted them. Was the South Platte River deeper then?
No. This was just one of many schemes dreamed up by News editor William Byers to boost
settlement in Colorado Territory -- by the time greenhorns discovered the deception, they were
in St. Louis, more than half-way here. The only "real" traffic on the South Platte, then or since,
were shallow-draft barges and canoes carrying beaver and buffalo hides to Missouri markets.
Steam-powered transportation did reach Littleton in 1871, when tracks of the Denver and Rio
Grande Railroad were completed to a siding at Richard little’s farm. On August 24, the engine
Montezuma brought the Mayor of Denver and assorted dignitaries to the end of the line. The
striking beauty of the area elicited such enthusiasm that the railroad added a public excursion



two days later, a Sunday, and sold out at $2.50 for the round trip. This began a long
relationship between the citizens of Denver and the "resort" community of Littleton.
Three years later, the Denver, South Park and Pacific Railroad laid tracks on the west bank of
the South Platte River, putting Littleton on the most direct route to the Leadville mining
district. In 1887 the Atchison, Topeka and Santa Fe pulled into town from Pueblo, joining
several smaller and/or short-lived lines. In 1889, one observer along the tracks wrote, "...we
counted twelve trains as they passed to and fro inside an hour. No one has any idea of the
monster traffic on these two roads until they go and look for themselves." At its peak, Littleton
boasted twenty-four scheduled stops a day for passengers and freight.

The star of the railroads was the D&RG's Uncle Sam,
a special excursion between Denver and Littleton,
with a stop at Fort Logan that ran as many as six trips
a day. Begun in 1888 and terminated in 1924, it was
considered one of the country's finest passenger
operations, and was the D&RG's most profitable
route, despite a round-trip fare of just 25 cents.
Between 1906 and 1923 the Uncle Sam boasted a
"Theater Train" once or twice a week.
D. & R.G. "Uncle Sam," c. 1916.

In the 1890s, during the height of railroad popularity, another transportation craze swept the
country -- bicycling. Although bicycles, or velocipedes as they were originally called, had
been around since the 1860s, the invention of pneumatic rubber tires and friction brakes
made it a household item. Denver led the craze, boasting the highest per capita bicycle
ownership in the country. Among the many popular bike paths constructed was south from
Denver along the city ditch to Littleton. Once there, many cyclists picnicked in the shade
surrounding the Sunshine and Shadow Inn or watched the bike races around the Inn's track,
while the more adventurous continued south to Palmer Lake and back, completing a

Littleton's street car, c. 1910.
"century" ride, or 100 miles in a day.

The next improvement was the electric trolley car, which was extended from Denver into
Littleton in 1907. The line came down south Broadway, went cross-country at Big Dry Creek
to enter the town on Prince Avenue and then turned onto Main. Eventually, the line was



extended across the South Platte River, south of Bowles Avenue. For a time, the Littleton
route included the famous "Cherrelyn" street car on south Broadway, where a horse assisted
the motors going up a steep grade, then climbed aboard and rode on the car during the
descent. The streetcar line was abandoned in 1926 in favor of cheaper o run and more
flexible buses.

The final improvement in personal transportation
began just after the turn of the century and continues
to today. In 1904, Rude Chandler's "benzine buggy"
automobile cruised onto Littleton's streets. Within
two years there were eight of the infernal contraptions
buzzing about and the city was besieged by calls to
license the machines and ticket those exceeding "an
immoderate speed". The city responded with a speed
limit for all conveyances of 8 miles an hour. Now, of
course, Littletonites could hardly imagine their city
without wide boulevards, super highways and the
automobile.
Dr. and Mrs. Crysler in their first
automobile, 1909.

Air Indian has first government sector company in India .It was
introduced long year ago in India And there after many private air lines comes in India .The
airlines has developing the service sector in India by providing tours and traveling facility to
the customer. In 19th century many tours & Travels Company introduce in India. Air Deccan
is continues to be one of the faster growing commercial passenger airlines today .Air Deccan
company has developed tours & travels sectors to provide various facility to the tours &
travels facility company. The airlines company has given registration to the tours & travels
company to sell his air ticket and developing the tourisms in country. All airline operators
and the competition continue to be stiff among all operators putting pressure on yields. The
future growth of air travels within to and from India will continue to depend on the growth of
the Indian economy. The company’s scheduled airlines business continued to grow in all
areas of its operations and your company is a significant player in the Indian domestic
aviation and tours & travels sectors. It has also achieved the distinction of becoming the
carrier with the widest reach covering more destinations then any other domestic carrier.
An Indian airline has succeeded in changing the face of the aviation and tours and travels
sectors in India. It has succeeded in enlarging the market for air travels and has turned air



travels into a mass commodity. Passengers traveling with tickets not issued from the
departure station on the below classes will be entitled for hotel accommodation, if available.

 Business Class Fares booked and ticketed in C, J, Z and I class.
 Economy Class Fares booked and ticketed in Y and M class.

The Tours & Travels Company has continuance of positive economic
factors and strong performance of the service and retails sectors should lead to
sustained growth in passenger traffic. The aviation market has witnessed a shift
growing aspirations. The unprecedented growth in passenger traffic in India has
attracted several airlines already to set up operations resulting in a highly competitive
environment.

A major development within the industry has been the recent
trend of consolidation. This has resulted in three major market share leaders, viz., Air
India-Indian, Jet Airways-Jetlite and Deccan-Kingfisher which control more than
85% of the market. It is expected that may result in a reduction in cut-throat pricing
leading to improved yields and, consequently, a road to profitability the combined
group of Kingfisher-Air Deccan will be in a better position to offer air travel options
across a wider network and to all segments of the traveling population. An all new
livery and colures and a complete makeover of the frontline staff and executives will
provide a whole new experience to both the existing traveler and a new traveler. The
Company’s operations, sales, marketing and distribution, front line and support
services and the completion of these are vital to achieve a profitable growth in the
future. India – the land to travel to, a haven of tourism delights, a civilization to tour
through. Tourists come to India for its wealth of sights, cultural exuberance, diversity
of terrain and in search of that special something, an extra punch that only India
promises and delivers. Teeming with over a billion people who voice over a million



concerns in fifteen hundred different languages, India is where people live with
variety, thrive on diversity and are too familiar with largeness to let it boggle them.
Mud huts and mansions face off across city streets. Lurid luxury and limp living are
inhabitants of the same lane.

History of Transportation

Fixed wheels on carts are invented - the first wheeled vehicles in
3500 BC
history. Other early wheeled vehicles include the chariot.
3500 BC River boats are invented - ships with oars
2000 BC Horses are domesticated and used for transportation.
181-234 The wheelbarrow is invented.
770 Iron horseshoes improve transportation by horse
Leonardo da Vinci first to seriously theorize about flying
1492 machines - with over 100 drawings that illustrated his theories
on flight
Cornelis Drebbel invented the first submarine - an human oared
1620
submersible



Blaise Pascal invents the first public bus - horse-drawn, regular
1662
route, schedule, and fare system
Jacques de Vaucanson demonstrates his clockwork powered
1740
carriage
First practical steamboat demonstrated by Marquis Claude
1783
Francois de Jouffroy d'Abbans - a paddle wheel steamboat

1783 The Montgolfier brothers invent the first hot air balloons
1787 Steamboat invented
First self-propelled road vehicle invented by Nicolas Joseph
1769
Cugnot
1790 Modern bicycles invented
Richard Trevithick invented the first steam powered
1801
locomotive (designed for roads)
Isaac de Rivas makes a hydrogen gas powered vehicle -
1807 first with internal combustion power - however, very
unsuccessful design
First steamboat with regular passenger service - inventor
1807
Robert Fulton's Clermont
George Stephenson invents the first practical steam
1814
powered railroad locomotive
1862 Jean Lenoir makes a gasoline engine automobile
1867 First motorcycle invented
George Westinghouse invents the compressed air
1868 locomotive brake - enabled trains to be stopped with fail-
safe accuracy
1871 First cable car invented
Karl Benz builds the world's first practical automobile to be
1885
powered by an internal combustion engine
Ferdinand von Zeppelin invents the first successful dirigible
1899
- the Zeppelin
1903 The Wright Brothers invent and fly the first engined airplane
1907 Very first helicopter - unsuccessful design
Henry Ford improves the assembly line for automobile
1908
manufacturing
Hydrofoil boats co-invented by Alexander Graham Bell &
1908
Casey Baldwin - boats that skimmed water
1926 First liquid propelled rocket launched
1940 Modern helicopters invented
1947 First supersonic jet flight
1956 Hovercraft invented



1964 Bullet train transportation invented
1969 First manned mission (Apollo) to the Moon
1970 First jumbo jet
1981 Space shuttle launched



 COMPANY PROFILE.
 VISION, MISSION AND GOAL
 BOARD OF DIRECTORS
 OBJECT OF SDT&TPL
 PRODUCT & SERVICE PROFILE

 DEPARTMENT STUDIES.
 ORGANIZATION FLOW CHART

PROFILE OF THE COMPANY

COMPANY HISTORY OF THE PLACE
The Shree Dayal Tours & Travels Private Limited was established in August 2001 at
Mumbai, Maharashtra State.

REGD. OFFICE & WORKS OF THE COMPANY
Shree Dayal Tours & Travels Private Limited
Corporate Office: 207, ARK Industrial Estate,
Makwana Road, Marol Naka,
Andheri (East)
Mumbai -400059.India
Tel: 91-228501786/2686/ 2489 Fax: 91-228504947



DIRECTOR OF THE COMPANY
Mrs.Roli P. Choudhery,
Ms.Babita Choudhary.
Mr. Suresh S.Choudhary

PRODUCT AND SERVICE LINE OF THE COMPANY
• Tours Product.

• Domestic and international Flight booking services.

• Hotel Booking services.

• Provided Bus facility services.

• Provided Car facility services.

• Provided Cruises services.

• Railways ticket booking services.

• Foreign exchange services.

CLIENTS OR CUSTOMERS
• Aditya Birla Groups
• Johnson & Johnson Pvt Ltd
• Siyaram textiles Pvt Ltd
• Other People

MARKET CHANNELS
• On the basis of Clients, they make Direct Sales to the Customers.

COMPETITORS
The main competitors of the Company are:



• Akbar Tours & Travels Pvt Ltd
• Riya Tours & Travels Pvt Ltd
• Kesari Tours & Travels Pvt Ltd.

NUMBER OF SHIFTS
General Shift:
9-00 AM to 6-00 PM

No. Of Working Days:
300 Days in a year

SHREE DAYAL TOURS & TRAVELS PRIVATE LIMITED
(SDT&TPL) is situated at Makwana Road Andheri (East) in Mumbai; State –
Maharashtra .Shree Dayal Tours & Travels Pvt Ltd is a medium scale of Tours & Travels
service providing company. Shree Dayal Tours & Travels Pvt Ltd was incorporated in the
year 2001. Shree Dayal Tours & Travels Pvt Ltd was set up in the year of 2001, 17 August.
The Registration number is U 63040 MH 2001 PTC 133094. The registered office of the
company will be situated in the state of Maharashtra i.e. within the jurisdiction of registrar of
companies at Mumbai. Shree Dayal is a Tours & Travels company .This company has
booking the aero planes ticket and booking, reserving accommodations seats, compartments
and berths on railways, Steam ships motor ships boats ,omnibus ,Motorbus and carriages of



all descriptions and to issue tickets international & Domestics for the same and to hire
taxies ,Motor car and all kind of Public vehicles and transports and to charter services and to
book reserve and secure for and on behalf of the constituents of the company ,Room and
boarding and lodging accommodations in hotels ,restaurants and boarding’s houses and to
handle cargoes ,goods ,luggage or baggage’s and also to book ,and secure accommodations
including boarding and lodging accommodations in resorts on behalf of guests or customers
of the company.
There is another industry in the Campus of Shree Dayal Tours & Travels Pvt Ltd
which is a husband concern Dayal Impax private Limited was established in the year 2003.
Dayal Impax private Limited has cloth stitching company .This company has taking order from
the supplier and prepare a cloth.

This company has provided many offer more than 15 leisure tour product to
Singapore and Europe, more than 10 to south East Asian and is the Domestic and
international tour operator in Indian tours. Shree Dayal tours & Travels Pvt Ltd also takes
pride in being consistently innovation in the tourisms industry.

The Shree Dayal Tours & Travels Private Limited is customer focused and
Quality oriented Service unit, which is continuously strive to services to meet its external
customer’s requirements. The main goal of the company is to giving full satisfaction to
the customer and providing good quality of service, enhancing to improve the services
and make company more competitive.

The Shree Dayal Tours & Travels Private Limited has specialized divisions
to cater to the needs of all types travelers, whether it is a guest looking for the safety and
security of escorted group tours, or someone seeking exclusive customized holidays or the
business traveler .We offer our guests a range of allied travel services such as air ticketing,
Visa, Foreign exchange and hotel booking at one stop for their convenience.



Company has issue domestic and also international flight ticket booking to the people on
the basis of the commission. The company has issue more flight ticket booking of that
company those who are give high commission to The Company .The Company has issued
or booking of the Domestic air ticket railway ticket, booking of hotel and give rent on car
The Company has also provided helicopter service facility to the people. The company has
also sold many tours product to the people for his tour convenience purpose. The company
has offered many tours product to the people. The company was offered world tours as well
as Indian tours to the people.

The company has offered tours product like Second Inning tours, Sport tours,
Honeymoon tours, Education tours, and Business tours to the people . The different Air
lines company has given different commission rate to the company. If the company has
ticket booked of Jet Air ways, Spice jet and go air Airline Company then SDT&TPL
Company will get 6% transaction fees. And remain Air ways like kingfisher, Indian
airlines; indigo and air Deccan air ways will get 3% transaction fees on booking of flight
ticket.

World Tour Indian Tour
Tashken Bali - WB Mt. Abu - Varanasi
t - WA 4 Days 3 W1 Allahaba
4 Days 3 Nights 4 Days 3 d - W2
Nights Hotel 4 Days 3
Nights Hotel
Dubai - Hong Nights
WD Kong -
4 Days 3 WH
Nights 4 Days 3
Nights Nilgiri Bhubanes
Hills-W3 war
Bangkok 4 Days 3 Konark
- WK Hotel Puri-W4
London -
4 Days 3 WL Nights 4 Days 3
Nights 4 Days 3 Hotel
Nights Nights



Mauritiu Amsterda Goa-W5 Khajuraho
s - WM m –WN 4 Days 3 Jabalpur
4 Days 3 4Days Hotel Bedaghat-
Nights 3Nights Nights W6
4 Days 3
Paris - Srilanka - Hotel
WP WR Nights
4 Days 3 4 Days 3
Katra Jaipur-W8
Nights Nights
Vaishnode 4 Days 3
vi-W7 Hotel
Singapor Turkey - 4 Days 3 Nights
e - WS WT Hotel
4 Days 3 4 Days 3 Nights
Nights Nights
Cochin
Maldives Samarkan Pondicher Munnar-
- WV d Bukhara ry WC
4 Days 3 - WX Mahabalip 4 Days 3
Nights 4 Days 3 uram-W9 Hotel
Nights 4 Days 3 Nights
Hotel
Nights

Name of Domestic Airlines:-



 Kingfisher Red.

 Jet Airways
 Indian Airlines.
 Spice Jet.
 Indigo
 Go Air
 Air Deccan

Name of International Airlines:-
Sr.No AIRLINE NAME PREFIX CODE
1 Singapore Airline SQ 618
2 Silk Air MI 629
3 Continental Airline CO 005
4 Sri Lankan Airline UL 603
5 Dragon Air KA 043
6 Royal Dutch Airline KL 074
7 Kenya Airways KQ 706
8 Air Canada AC 014
9 Korean Air KE !80
10 Thai Airways TG 217
11 Northwest Airlines NW 012
12 American Airlines AA 001
13 Qatar Airways QR !57
14 Air India AI 098
15 Air One AP 867



16 Bangkok Airways PG 829
17 Gulf Air GA 084
18 Air Mauritius MK 239
19 Jet Airways 9W 589
20 LAN Chile LA 045
21 LAN Peru LP 544
22 LAN Argentina 4M 469
23 Austrian OS 257
24 Philippine Airlines PR 079
25 Swiss Airline LX 724
26 Royal Jordanian RJ 512
27 South African Airways SA 083
28 Virgin Atlantic VS 932
29 Saudi Airlines SV 065
30 Egypt Airlines MS 077
31 Japan Airlines JL 131
32 Air China CA 999
33 British Airways BA 125
34 Indian Airlines IC 297
35 China Airlines CI 297
36 Turkish Airlines TK 235
37 Air New Zealand NZ 086
38 Kuwait Airlines KU 229
39 Air France AF 057
40 China Southern CZ 784
41 Kingfisher IT 090
42 Oman Air WY 910
43 EVA Air BR 695
44 Biman Airlines BG 997
45 Air Portugal TP 047
46 Iran AIR IR 096
47 Air Astana KC 465
48 Delta Airlines DL 006
49 Pakistan Airlines PK 214
50 Virgin Blue DJ 856

Details about Fair Rate of the Airline



 Business Class.
 Economic class.
1:-BUSINESS CLASS FLIGHT FAIR

Sr.no STATE AIRLINES CODE Included
TAX Total
1 America Delta Airline BOM/JFK/EWR 738188

2 Australia Qantas Air BOM /SYD/ MEL/ 242710
3 Sri Lanka Srilanka BOM/ CMB/BOM 49398
4 Canada Jet Airways BOM/ YYZ/BRU 242769
5 Newzland Singapore BOM/AKL/BOM 207534
6 South Africa Kenya Airlines BOM/JNB/BOM 122155
7 England Luptansa BOM/LHR/MAN 274005
8 Mexico Delta Airline BOM/ MAX /BOM 572192
9 Saudi Arabia Air India BOM/ RUH/BOM 44181
10 Nepal Jet Airways BOM/ KTM /BOM 71545
11 Etly KU BOM/ RWI/ ROM/ 221434
12 China 9W BOM/PVG/BOM 120193
13 Russia Aeroflot BOM/ SVO /BOM 104055
14 France Air France BOM/CDG /BOM 234146
15 Germany Luptansa BOM/ FRA/ MAM 236212
16 Kolalampur Malaysia BOM/KUL/BOM 86602
17 Singapore Singapore BOM/ SIN/BOM 83709
18 Dubai Emirates BOM/DXB/BOM 86758
19 Turkey Turkey BOM/IST/BOM 226453
20 Bangkok Bk BOM/BKK/Bom 62894
2:-ECONOMY CLASS FLIGHT FAIR

Sr.no STATE AIRLINES CODE Included TAX
Total
1 America Delta Airline BOM/JFK/EWR 110138
2 Australia Qantas Air BOM /SYD/ MEL/ 183545
3 Sri Lanka Srilanka BOM/ CMB/BOM 28534
4 Canada Jet Airways BOM/ YYZ/BRU 144482



5 Newzland Singapore BOM/AKL/BOM 63152
6 South Africa Kenya Airlines BOM/JNB/BOM 83592
7 England Luptansa BOM/LHR/MAN 78690
8 Mexico Delta Airline BOM/ MAX /BOM 271088
9 Saudi Arabia Air India BOM/ RUH/BOM 28867
10 Nepal Jet Airways BOM/ KTM /BOM 29199
11 Etly KU BOM/ RWI/ ROM/ 82320
12 China 9W BOM/PVG/BOM 42068
13 Russia Aeroflot BOM/ SVO /BOM 79061
14 France Air France BOM/CDG /BOM 91781
15 Germany Luptansa BOM/ FRA/ MAM 72044
16 Kolalampur Malaysia BOM/KUL/BOM 39377
17 Singapore Singapore BOM/ SIN/BOM 27324
18 Dubai Emirates BOM/DXB/BOM 47123
19 Turkey Turkey BOM/IST/BOM 50696
20 Bangkok Bk BOM/BKK/Bom 40060

Vision

S.exe
“Spreading Smiles Happiness and Joyful life to People and Developing the
Business in a country”.

Mission



“Shree Dayal Tours & Travels is passionately committed to quality travel, with
continual delivery of value added services .We upholds the highest ethical
standards and believes in creating new benchmarks in the industry”.

Goals

Main goal of company

 To earn a profit.
 To providing good quality of services to people.
 To attracting new and new customer.
 To service can not stop any boundary.

SHREE DAYAL TOURS & TRAVELS PRIVATE LIMITED

BOARD OF DIRECTORS

 Ms.Roli Choudhary.
 Ms.Babita Choudhary.

 Mr. Suresh S.Choudhary.



MANAGING OF DIRECTOR

 Mr.Pawan S.Choudhary

STATUTORY AUDITORS

 N.B Shetty & co
Mumbai

BANKERS

 Oriental Bank of Commerce.

RIGISTER OFFICE

207 –ARK Industrial Estate
Makwana Road, Marol Naka
Andheri (East)
Mumbai-400058.

Object of Shree Dayal Tours & Travels Pvt Ltd

The main Objects of the Company as set out in the Memorandum of Association
of the Company are as follows:

 To run manage or carry on the business of taxi cars, deluxe coaches ,lorries , cars ,trucks,
airships wagons ,rail , motors vessels, ferries ,boats and other vehicles propelled by
electricity, gas ,gasoline compressed air steam ,manned power ,mechanized power, oil



,crude oil, automatic or other energy or by whatsoever means and from any place or
another whether within India or otherwise for the purpose of carrying conveying
,transportation goods , materials produce ,machinery ,animals passengers, merchandise ,
mail ,freight ,and all such things which may be conveniently carried on with the aforesaid
object of the company.
 To insure with any persons or company, against losses, damages, risks and liability of
any kind which may effect the company either wholly or partially and if thought fit to
effect any such insurance by joining or becoming members of any mutual insurance,
protection or indemnity association federation or society and to accept any such
insurances or any thereof for the account of the company.
 To procure information for as to the standing and responsibility of parties with whom
they propose to transact business.
 To provide clear ,comfortable and inexpensive sleeping accommodation for workmen
and others and in connection their with to the afford to such persons facilities and
convenience for washing ,bathing ,cooking , reading, writing , and finding employment
and for the purchase ,sale and consumption of provisions both liquidity and solid.

Product & Service Profiles

The Shree Dayal Tours and Travels Pvt Ltd have provided many tours product
to the people .The company has also provided service to the people. The totally honest policy,
excellent service and perfect tours planning are the hallmarks of company success. The company
has perfected our tour itineraries to meet the special needs of the discerning tourist.

Product Profile: - (Tour Products)

1. Second Innings Tours



2. Educational Tours.
3. Honeymoon Tours.
4. Holiday after Holiday Tours.
5. Sports Tours.
6. Chillax Tours.
7. Business Tours.
8. Thrillax Tours.

1) Second Inning Tours:-
An exclusive tour for senior citizens is fully of masti mazz & magic .its a
great way to discover a holiday experience that is truly unique and great opportunity
to meet seniors from different walks of life.

2) Educational Tours:-
Educational tours take teaching out of the textbooks. its gives wonderful
opportunity to learn about various historic event and key location.

3) Honeymoon Tours:-
Honeymoon tours will give the wonderful happy moment for life time
and that make happy to the life partner.

4) Holiday after Holiday Tours:-
Holiday after holiday tours will give advance tours information to the
people those who again enjoy to holiday.

5) Sports Tours:-
Sport tours just for the vacationer who want s to combine holiday cheer with
edge of the seat sporting encounter.

6) Chillax Tours:-
This tour is perfect respite from work stress and the daily grind. Specially
tailored to put the spring back into your stride, itsyour chance to let your hair down and
indulge in the unexpected. Just make sure your boss hasn’t.

7) Business Tours:-



This tours facility sports enthusiasts this one will have you cheering SDT&TPL
introduces sports tours tailored just for the vacationer who want to combine holiday cheer
with edge of the seat sporting encounter.

8) Thrill ax adventure tours:-
Thrill ax vacation a new SDT&TPL special tours product and life will never
be the same again. Feel your adrenaline pumping as you hurtle over white water Rapides.
The discovery skill you never knew you possessed, climbing rock faces because it’s
about time you stopped existing and started living.

SERVICE PROFILE:-

 Domestic and international Flight booking services.

 Hotel Booking services.

 Provided Bus facility services.

 Provided Car facility services.

 Provided Cruises services.

 Railways ticket booking services.

 Foreign exchange services.

 Provide tours & travels services

DEPARTMENT STUDIES

 Finance Department.

 Marketing Department.

 Air Ticket Booking Department.

 Hotel Booking Department.



 Billing Department.

 Forex Department.

1) Finance Department

Finance is an essential component of the business to maintain its operations effectively.

This dept. is concerned with day-to-day activities like purchases, sales salary etc. and proper

management and maintenance of accounts of concerned year.

Factions

 Day to day/ bank transactions.

 Bill passing and payment

 Recovering all transactions in books of accounts

 Preparations of cash Balance statement.

 Bank Reconciliation.

 Preparation of Inflow and out flow of cash statement.

 Providing various types of management Information system reports required by management

from time to time

 Carry out auditing.

2) Marketing Department :-
Among all the functional areas of management marketing are play vary important t role
for selling product of the company. The with marketing Department the company can sold
product to the customer or public.



Factions

 Selling of Tours Product.

 Increasing sales of the company.

 Awareness about product and service to the customer.

 Advertising of company product.

3) Air Ticket Booking Department:-

The main function of air ticket booking department is to flight ticket booking .The
Company has ticket booking as per the order of the customer. The department is booking of
national as well as international ticket of flight.

Factions

 Booking of Ticket.

 To give the information regarding the Air lines.

 To give the information regarding the fair price or low price airlines.

4) Hotel Booking Department:-

Hotel booking department is important because the people booking through the tours &
travels company .The hotel booking department has given full information regarding the hotel to
the customer .Hotel booking department has knowledge about each hotel and which types of
service provide to the customer.

Factions

 Booking of Hotel as per order.

 To give the information regarding the Hotel.

 To give the information regarding the fair price and better service providing hotel.



5) Billing Department:-

Billing department has prepared a bill of airline & hotel. The billing department has
prepared the day to day booking of airline, hotel and other service provided by company .to the
customer.

Factions

 Preparing Bill of airline ticket booking per day.

 Preparing Bill of hotel booking per day.

6) Forex Department:-

Forex department is doing transaction of foreign exchange. The forex
department is handling day to day transaction of foreign exchange .The forex department has
prepared the visa and also change the currency of tourist those who want go other country for
tourism purpose.

Factions

 Exchange currency with bank.

 Day to Day rate fluctuation record of each country.

 Preparing visa.

 Providing foreign currency required customer.

 Handling foreign currency trading activity.

ORGANISATIONAL FLOW CHART OF SDT&TPL

DIRECTORS



MANAGING DIRECTOR

____________________________________________________ ____________ ___
Forex
Department

Finance Department Marketing Department Ticket Booking Hotel Booking Billing Department Forex Department
Department Department

Foreign Exchange
Manager
Senior. Finance Hotel Ticket Billing Prepare
Manager Marketing Manager Booking Manager Manager Foreign Exchange
Manager

____________________

Assistant. Finance
Manager Domestic Air Ticket International Air Ticket
Booking Booking

Air Ticket Booking
Manager



.

 SCOPE OF THE STUDY

 OBJECTIVE OF THE STUDY

 RESEARCH METHODOLOGY

Scope and limitations of the study



This project acts as a reference guide or as a source of information. It gives the idea
about the financial analysis of the firm. The main scope of the study was to put into practical the
theoretical aspect of the study into real life work experience. The study deals with analysis and
interpretation of the data collected through the sources of primary and secondary data for a
period of five financial years. I.e. 2004-2005, 2005-2006, 2006-2007, 2007-2008 and 2008-2009
Graphs, diagrams and tabulation methods are used to analyze and interpret the data collected. It
will help to understand the company’s liquidity position. Since the decision regarding working
capital are of an operating nature not one time decision, the scope of the study is geared towards
identifying important areas of control and to establish model for better control of the various
components of working capital
The study would also attempt to identify the various sources available for financing of
working capital.
The study gives a fair idea of improvement in efficiency of working capital management
and also to have proper control over the components of working capital and managing of
efficiency.

LIMITATION OF THE STUDY
• This study deals only with the data made available. Hence the result of this study
cannot judge the business of the firm in general
• The study have been influenced by the limitation of the ratio analysis
• The study extensively uses the data provided is the financial reports of the firm which
may also have their own limited perspective
• The analysis made on the working capital management is for a particular period of
time the current assets and current liabilities will change for an analysis made at any
other of time.



Objectives of the study

To study the working capital requirement of a company.

To know the progress of working capital in a company

To study the loan & advances and repayment of loan of company.

To know the solvency of the company & how the company is managing working
capital.

The basic objective of the study is to see the liquidity position of the company

To study the efficiency of working capital management of the company.

To study the efficiency of cash, and receivables management of the company



Methodology

The data in this project is enabling in secondary in nature. Financial reports, company
records were referred for data analysis. The study has been undertaken by collecting relevant
data from the balance sheet, profit and loss a/c, annul report & Audit report of the shree Dayal
tours & travels Pvt ltd. the company is used financial tools for the analyzing and interpretation
data.
However primary data is also collected by observation discussing with company officials.
This primary data is used to fill in the gaps while preparing this report and to know the latest
procedures adopted by the company. This has helped to draw inferences and conclusions.

Sources of data

There are two types of data

 Primary Data

 Secondary Data

Primary Data:-

The primary data are those, which are collected fresh for the first time
and thus happen to be original in character. The primary data collection involves the
collecting of information for the first time by observation, experimentation, and
questionnaire and through interview schedules in the original form by the researcher himself
or his nominees.

Plan of action

The primary data was collected through discussion with the finance manager using the
interview schedule. This data was obtained to study the latest procedures relating to working
capital management and ratio analysis system followed by the company



Secondary data:-

The secondary data are those, which have been collected by some other and which
have been processed. Generally speaking secondary data are information, which have been
previously collected by some organization to satisfy his own need. But the department under
reference for an entirely different reason is using it.

I was used secondary sources also for collecting the data. They are:
• Information from the text sources
• Information form the internet sources
• Information from the materials provided by the concern

SAMPLING DESIGN
2 Sampling unit : Financial Statements & Audit Reports
3 Sampling Size :Last five years financial statements
.



 MEANING OF CAPITAL
 FORM OF CAPITAL
 MEANING OF WORKING CAPITAL
 TYPE OF WORKING CAPITAL
 NATURE OF WORKING CAPITAL
 FACTORS DETERMINING WORKING CAPITAL
REQUIREMENTS
 FINANCING OF WORKING CAPITAL
 COMPONENTS OF W.C
 WORKING CAPITAL COMPOSITION



CAPITAL
Introduction:-
Capital is the keynote of economic development. In this modern age, the level of
economic development is determined by the proportion of capital available.

Meaning of Capital:-
In the ordinary sense of the word Capital means money. But in economics, Capital
has a special meaning. All those man made goods used in the production process is called
capital.

Definition:-
“Capital consists of all kinds of wealth, other than free gifts of nature which yield
income.”

Features of Capital:-
Capital has the following features.
1. Capital is a man made.
2. Capital is a perishable.
3. Capital is a human control possible.
4. Capital is a mobile.
5. Capital is a human sacrifice.
6. Capital is a scarce.
7. Capital is a passive factor.



Forms of capital:-

The Three Primary Types of Financial Capital

 Equity Capital

 Debt Capital

 Specialty Capital

1* Fixed Capital.

2* Working Capital

 Equity Capital :-

Otherwise known as “net worth” or “book value”, this figure
represents assets minus liabilities. There are some businesses that are funded entirely
with equity capital (cash written by the shareholders or owners into the company that
have no offsetting liabilities.) Although it is the favored form for most people because
you cannot go bankrupt, it can be extraordinarily expensive and require massive amounts
of work to grow your enterprise. Microsoft is an example of such an operation because it
generates high enough returns to justify a pure equity capital structure.

 Debt Capital :-
This type of capital is infused into a business with the understanding
that it must be paid back at a predetermined future date. In the meantime, the owner of
the capital (typically a bank, bondholders, or a wealthy individual), agree to accept
interest in exchange for you using their money. Think of interest expense as the cost of
“renting” the capital to expand your business; it is often known as the cost of capital.
For many young businesses, debt can be the easiest way to expand because it is
relatively easy to access and is understood by the average American worker thanks to



widespread home ownership and the community-based nature of banks. The profit for the
owners is the difference between the return on capital and the cost of capital.
 Specialty Capital :-
This is the gold standard. There are a few sources of capital that have
almost no economic cost and can take the limits off of growth. They include things such
as a negative cash conversion cycle (vendor financing), insurance float, etc.

Negative Cash Conversion (Vendor Financing) Imagine you own a retail store. To
expand your business, you need $1 million in capital to open a new location. Most of this
is the result of needing to go out, buy your inventory, and stock your shelves with
merchandise. You wait and hope that one day customers come in and pay you. In the
meantime, you have capital (either debt or equity capital) tied up in the business in the
form of inventory. Now, imagine if you could get your customers to pay you before you
had to pay for your merchandise. This would allow you to carry far more merchandise
than your capitalization structure would otherwise allow. AutoZone is a great example; it
has convinced its vendors to put their products on its shelves and retain ownership until
the moment that a customer walks up to the front of one of AutoZone’s stores and pays
for the goods. At that precise second, the vendor sells it to AutoZone which in turn sells it
to the customer. This allows them to expand far more rapidly and return more money to
the owners of the business in the form of share repurchases (cash dividends would also be
an option) because they don’t have to tie up hundreds of millions of dollars in inventory.
In the meantime, the increased cash in the business as a result of more favorable vendor
terms and / or getting your customers to pay you sooner allows you to generate more
Income than your equity or debt alone would permit. Typically, vendor financing can be
measured in part by looking at the percentage of inventories to accounts payable (the
higher the percentage, the better), and analyzing the cash conversion cycle; the more days
“negative”, the better. Dell Computer was famous for its nearly two or three week
negative cash conversion cycle which allowed it to grow from a college dorm room to the
largest computer company in the world with little or no debt in less than a single
generation.



Float
Insurance companies that collect money and can generate income by
investing the funds before paying it them out in the future in the form of policyholder
payouts when a car is damaged, or replacing a home when destroyed in a tornado, are in a
very good place. As Buffet describes it, float is money that a company holds but does not
own. It has all of the benefits of debt but none of the drawbacks.

His most important consideration is the cost of capital – that is, how much
money it costs the owners of a business to generate float. In exceptional cases, the cost
can actually be negative; that is, you are paid to invest other people’s money plus you get
to keep the income from the investments. Other businesses can develop forms of float but
it can be very difficult.

Sweat Equity
There is also a form of capital known as sweat equity which is when an owner
bootstraps operations by putting in long hours at a low rate of pay per hour making up for
the lack of capital necessary to hire sufficient employees to do the job well and let them
work an ordinarily forty hour workweek. Although it is largely intangible and does not
count as financial capital, it can be estimated as the cost of payroll saved as a result of
excess hours worked by the owners. The hope is that the business will grow fast enough
to compensate the owner for the low-pay, long-hour sweat equity infused into the
enterprise

. 1. Fixed Capital :-
Fixed capital is one, which can be used in production again and again for a long
period. In other words, fixed capital is the capital, which can be used over and over in the
process of production. It is a capital, which is durable and can be used over a long period of time.
For example: - Machinery, building, tools, implements etc.

2. Working Capital :-



Working Capital is the capital which can be used only once in the process of production.
In other words, It refers to capital which can be used only once in production. It loses its utility
after a single use.E.g: - Raw material, Coal and petroleum, Payment of wages etc.
INTRODUCTION

As every enterprise knows that, working capital is the lifeblood and control
of nerve center of the business. Just as circulation of blood is the essential for
maintaining life, working capital is also essential for maintaining the smooth running of
the business.

The importance of working capital management is indisputable; Business
liability relies on its ability to effective management of receivables, inventory, and
payables. By minimizing the amount of funds tied up in current assets. Firms are able to
reduce financing costs or increase the funds available for expansion. Many managerial
efforts are put into bringing non-optimal level of current assets and liabilities back
towards their optimal levels.

Working Capital refers to the amount of capital which is readily available to an
organization that is, working capital is the difference between resources in cash and
readily convertible into cash (current assets) and organizational commitments for which
cash will soon be required (current liabilities).

Thus, working capital involves activities such as arranging the short-term
finance, negotiating favorable credit terms, controlling the movement of cash,
administrating accounts receivables and monitoring the investments also a great deal of
time.



Meaning of working capital

The financing required by a concern for carrying on its day-to day operations is known
as the “working capital”.

In Accounting:

‘Working capital is the difference between the inflow and outflow of funds’. In other
words, it is the net cash inflow’
Thus it is defined as
“The excess of current assets over current liabilities and provisions”.

Working capital is a liquidity (cash) concept. A business might show a "profit," but if it
cannot maintain a positive cash position (that is, having money in the bank to pay bills
each month), the business cannot continue to operate.

Positive working capital means that the company is able to pay off its short-term
liabilities. Negative working capital means that a company currently is unable to meet its
short-term liabilities with its current assets.



Importance of Working Capital

This chapter reveals the importance of working capital management of an organization to
carry over its business successfully.

Significance of working capital management as follows
Normally firm has to employ certain short-term assets & short run sources of financing.
The management of such assets, describe as working capital management or Current Assets
Management. It is one of the most important aspects of the over all financial management.

Working Capital Management is concerned with the problem that arises in attempting to
managing the current assets & current liabilities & the inter relationship that exits between them.

Working of a firm should neither be too large, too small. If the working capital is large,
the liquidity position would improve, but profitability would be advertise affected, as funds will
remain idle conversely, if the working capital is too small, the overall profitability, position &
make the firm more risky working capital management therefore at aim at striving a balance,
such that an enterprise is able to.

1. Generate cash in sufficient quantities at the right time &
2. Extract fullest use from each shot term resources used in business.

This involves planning & controlling all the items, which drains or augment liquidity.

The working capital is the lifeblood business, which circulates through the naves as short-
term investment in aforesaid areas. It is also regarded as a heart of business. If it becomes weak



the business can hardly prosper & survive. This brightness the opportunity for achieving highs of
success.

Type of Working capital

Introduction

The financial concept of working capital equates it with current assets. According
to this view the total of the working capital is the total value of the current assets of the
company. This is known as the ‘Gross working capital’.
According to the excess of current assets, over current liabilities. In other words, it
is the difference between current assets and current liabilities. This concept of working
capital is called the Net Working Capital.
Hence there two concepts of working capital.

1. Gross Working capital and
2. Net Working Capital

1. Gross Working Capital

The Gross Working Capital (also known as circulating capital, operating capital or
current capitals) represent the quantitative aspect of Working capital since it concerns with the
total value of current assets to be held by the company. The management of Gross working
capital is a short-term phenomenon involving a continuous study of the fluctuation in investment
in current assets. The aim is to neither maintain the level of current assets at proper level neither
at a high level involving unnecessary costs nor at a low level threatening. Production needs.
Current assets include cash in hands, bank balance, bills receivables, sundry debtors, short-term
loans advances, inventories and marketable seventies.



Advantages of working capital.

a) Financial managers are profoundly concerned with current assets.
b) Gross Working Capital provides the current amount of working capital at the right times.
c) It enables a firm to realize the greatest retime on it investment.
d) It helps the fixation of various areas of financial responsibility.

NET WORKING CAPITAL

The net working capital is the difference between current assets and current liabilities. The
concept of net working capital enables a firm to determine how much amount is left for
operational requirements. The net working capital is financed from long term sources which may
includes barrowed funds in the form of term loans, debentures etc. or own funds like plough-
back profits, etc, or both. The management of net working capital is a long-term phenomenon
current liabilities include bills payable, sundry creditors, short-term loans advances and bank
OD.
Needles to say that the firm aims at maximizing the wealth of shareholders wealth .They
should earn sufficient return from its operations. To earn sufficient amt of profit it requires
successful sales utilized to their fullest capacity for this purpose proper management of working
capital is essential because fixed assets can’t work without working capital.

Various research studies suggest. The Gujarat study team, Gujarat the SBI study team has
confirmed that inadequacy of working capital and improper management of working capital has
contributed enormously for the ailment of industrial enterprises.

Working capital management refers to the administration of all aspects of current assets. If has
been observed that a creation of financial manager time is utilized in the management of working
capital. It is devoted for raising working capital and managing it efficiently.

Factors determining working capital Requirements



Factors Determining Working capital Requirements

Nature of Business Seasonality of operations Market Condition Supply condition C.A C.L
.

Financing of working capital

Introduction: -

This chapter put forth the discussion on the sources available for financing the
working capital of an organization.

Funding of working capital is continuous problem for all management. Basically
sources of financing working capital are broadly bifurcated into two sources they are as follows.

Sources of financing of working capital

1. Short Term Finance 2.Long Term Finance

Trade Credit Share Capital

Bank Credit Borrowing from Bank

Bank Financing of Accounts Public Deposits.
Receivables

Factoring



Bank Financing of Inventory

Working Capital Financing

COMPONENTS OF WORKING CAPITAL
The components of working capital are:
 Cash management
 Receivables management

CASH MANAGEMENT
Cash is the liquid form of an asset. It is the ready money available in the firm
or with the business, essential for its operations. A firm needs the cash for the following
three purposes:

Transaction Motive: The firm must and should keep the funds for transactions like
purchase, sales etc. These activities, which are not known in advance, are not considered
while preparing a cash budget.

Precautionary motive: The firm also keeps funds for the safeguard against
uncertainties, which are an integral part of business operations.

Speculative Motive: To tap profits from opportunities arising from fluctuations in
commodity prices, security prices, interest rates etc. The company with surplus cash is in
a better position to exploit such situations.

 RECEIVABLES MANAGEMENT
Receivable represents amounts owed to the firm as a result of sale of goods or
services on the ordinary course of business. These are claims of the firm against its
customers and form part of its current assets. These receivables are carried for the
customers. The period of credit and extent of receivables depends upon the credit policy



followed by the firm. The main purpose of maintaining or investing in receivables is to
meet competitors, to increase sales, and to maintain a cordial relationship with the clients.
Receivables management is the process of making decisions relating to
investment in trade debtors. However, at the same time, investment in this current asset
involves cost considerations also. Therefore, there is always a risk of bad debts too.

Credit Evaluation
There are three approaches used for credit evaluation. These are:

• Traditional Credit analysis
• Numerical Credit Scoring

Working capital composition

Introduction: -
This part unfolds the discussion on the composition of the working capital i.e. the
proportion different current assets is determined by the trade of between the two seemingly
opposite objectives of liquidity and portability.
Liquidity refers to the ability of an asset get convert into cash at short period and
without loss in value .A Company is said to liquid when they arise. This ability is also known as
technical solvency of the company. The creditors and other lenders of the company would like to
have the ability of meet their dues on their due dates this means much of the current assets
should be held in the form of cash and near near-cash items like marketable. Securities, But cash
is a non-earning asset and yield on marketable seethes will affect the profitability of the concern.
The consideration of the profitability requires that the level of current assets is
kept low and also such a form as will aid production and generate surplus. Thus the objectives of
liquidity (solvency) and profitability seem to operate in opposite to directions. While liquidity
requires large we current assets to be kept and of that mostly in cash and near-cash form
profitability requires that the current assets should be kept at low levels and that too in form,
which will contribute to production. By proper planning the opposing objectives can be
recognized and made to compliment each other.
Keeping liquidity at adequate levels helps the managers to concentrate on
production in a congenial atmosphere and by increase the efficiency of functioning. This leads to



greatly profitability, since the profits ultimately constitute the sources of repayment of the
company’s dues, higher profits increase the liquidity of the concern.

Conclusion:-

Thus the chapter states that the objectives of liquidity and profitability seem to
operate in opposite directions, while liquidity requires large current assets to be kept and
profitability requires the current assets should be kept at low levels, which will contribute to
production.



Ratio Analysis
1) Net Working Capital:-
Net working capital is the difference between current assets and current Liabilities.
Years Current Asset Current Liabilities NWC
2004-05 26352381.8 6122630.12 20229751.69
1
2005-06 30087971.0 6843164.00 23244807.00
0
2006-07 46858833.0 9979106.00 36879727.00
0
2007-08 44389218.0 12123368.00 32265850.00
0
2008-09 62495041.00 11527167.00 50967874.00



Ratio

60000000.00
50000000.00
40000000.00
NWC

30000000.00 Ratio
20000000.00
10000000.00
0.00
2004-05 2005-06 2006-07 2007-08 2008-
09
year

INTERPRETATIO:-
In The year 2004-05 the company has 20229751.69 N.W.C. In the
year 2005-06 the N.W.C is 23244807.00 and in the year 2006-07 the company has
36879727.00.NW.C But in the year 2007-08 the company has 32265850.00 N.W.C but
the N.W.C has decline drastically compared to the previous years, but in the year 2008-
09 the company has 50967874.00 N.W.C that means the company in a favorable position
& N.W.C has improved vary fast as compared to the previous years which show liquidity
Position of the Shree Dayal Tours & Travels Pvt Ltd has always more & sufficient
working capital available to pay off its current liabilities.

2. Current Ratio:-

Current ratio is a measure of firm’s short-term solvency. This ratio is also known as
working capital Ratio. Current ratio is a measure of general liquidity and is most widely used to
check the relationship of the current assets and current liability. The standard current ratio is 2:1.

Current Ratio = Current Assets
Current Liabilities

Years Current Asset Current Liabilities Ratio



2004-05 26352381.81 6122630.12 4.304
2005-06 30087971.00 6843164.00 4.397
2006-07 46858833.00 9979106.00 4.696
2007-08 44389218.00 12123368.00 3.661
2008-09 62495041.00 11527167.00 5.422
Diagram:
Ratio

6

5

4
Ratio

3 Ratio

2

1

0
2004-05 2005-06 2006-07 2007-08 2008-09
year

INTERPRETATION:-

The current ratio was 4.304 in the year 2004 – 2005 and the year 2005-
2006 the current ratio was 4.397 and in the year 2006 -2007 the current ratio was 4.696 this show
the current ratio has increase every year but in the year 2007-2008 the current ratio was
decreased to 3.661.in the year 2008 – 2009 the current ratio has increases 5.422 .The current
ratio is above the standard of 2: 1 ratio and hence it can be said that there is enough working
capital in Shree Dayal Tours & Travels Pvt Ltd to meet its current liabilities.

3. Absolute Liquidity Ratio:-

Concept: -

Absolute liquidity ratio is a ratio of cash in hand and cash at bank to current liabilities. The
standard ratio is 0.5: 1.

Absolute liquidity Ratio = Cash in hand + Cash at bank
Current Liabilities

Years Cash in hand Cash at bank Current Liabilities Absolute
Liquidity Ratio
2004-05 322305.70 600000.00 6122630.12 0.15



2005-06 151478.00 600000.00 6843164.00 0.10
2006-07 125254.00 600000.00 9979106.00 0.07
2007-08 95663.00 600000.00 12123368.0 0.05
0
2008-09 64627.00 600000.00 11527167.00 0.05

Diagram: -

Absolute Liquidity Ratio

0.16
0.14
0.12
0.1
ABR

0.08 Absolute Liquidity Ratio
0.06
0.04
0.02
0
2004-05 2005-06 2006-07 2007-08 2008-09
Year

INTERPRETATION:-

The absolute liquidity ratio was 0.15 in the year 2004-2005 and decreased
to 0.10 in the year 2005 – 2006 and it does not increase further up to 2008-2009.But in the year
2007 -2008 and 2008-2009 it was same. The absolute liquidity ratio is below the standard of 0.5:
1 ratio. It shows that the liquidity position of the concern is unsatisfactory

4. Liquidity Ratio or Liquid ratio:-

Concept: -

This ratio indicates very short term or immediate or very instant financial position.

Liquidity Ratio = Quick Assets
Quick Liabilities

Years Current Assets Current Liabilities Liquidity Ratio
2004-05 26352381.81 6122630.12 4.30
2005-06 30087971.00 6843164.00 4.40
2006-07 46858833 9979106.00 4.70



2007-08 44389218.00 12123368.0 3.66
0
2008-09 62495041.00 11527167.00 5.42

Diagram: -

Liquidity Ratio
liqudity ratio

6
5
4

3 Liquid
ity
2 Ratio

1
0
2004-05 2005-06 2006-07 2007-08 2008-09

ye ar

INTERPRETATION:-
The absolute liquidity ratio was 4.30 in the year 2004-2005 and increases to 4.40 in the
year 2005 – 2006 and 4.70 in the year 2006-07, 3.66 in the year 2007-2008 it was decrease due
to increase of labilities.But in the year 2008 -2009 the L.R has increased 5.42 because the C.L
has decreased. The liquidity ratio is above the standard of 1: 1 ratio. It shows that the liquidity
position of the company is satisfactory.

5. Return on Current Assets:-
Concept: -
This ratio indicates the amount of current assets employed in the working capital of the
assets employed in the working capital of the firm as to run the day to day operations of the firm
which helps the firm for its easy flow of goods in the trading activity.

Return on Current Assets = Profit after Tax
Current Asset

Year Profit After Tax Current Asset Ratio
2004 – 2005 437894.00 26352381.81 0.016
2005 – 2006 423298.00 30087971.00 0.014



2006 – 2007 592576.00 46858833.00 0.012
2007-2008 843910.00 44389218.00 0.019
2008-2009 1039889.00 62495041.00 0.016
Diagram: -
Ratio

0.02
Return on Assets

0.018
0.016
0.014
0.012
0.01 Ratio
0.008
0.006
0.004
0.002
0
2004-05 2005-06 2006-07 2007-08 2008-09
Year

INTERPRETATION:-
The Returns on current assets was 0.016 in the year 2004-2005 and it
decreased to 0.12 in the year 2006-2007. It further increased to 0.019 in the year 2007-2008 and
further decreased 0.016 in the year 2008-2009 .It shows that profit will increase then asset
turnover ratio will decline then C.A will increase but in the year 2007-2008 asset ratio was
increased 0.19 because C.A has fall that year. Company has profit transferred to the reserve and
surplus Account shown in balance sheet..

6. Current Asset Ratio:-
Concept: -
This ratio measures sales per rupee of investment in current assets. This ratio
measures the efficiency with which current assets are employed a high ratio indicates a high
degree of efficiency is asset utilization and a low ratio reflects inefficient use of current assets.

Current Asset Ratio = Net Sales
Average Current Assets

Year Sales Average Current Ratio
Asset
2004 – 2005 102199181.00 19967762.36 5.11 time
2005 – 2006 132858985.00 28220176.41 4.70 time



2006 – 2007 171671451.00 38473402.00 4.46 time
2007-2008 221246824.00 45624025.5 4.84 time
2008-2009 286246257.00 53442129.5 5.35 time
Diagram: -
Ratio

5.6
5.4
5.2
C.A.R

5
4.8 Ratio
4.6
4.4
4.2
4
2004-2005 2005-2006 2006-2007 2007-2008 2008-2009
Year

INTERPRETATION:-
The current asset ratio was 5.11 times in the year 2004-2005 and 4.70 in
the year 2005-06 and 4.46 in the year 2006-2007 it was decreased. It further increased to 4.48 in
the year 2007-08 & 5.35 in the year 2008-2009. It shows that the current assets are not utilized
properly.

7 .Debtors Turnover Ratio:-

Concept: -
Debtors are expected to be converted into cash over a short period of time and
therefore are included in current assets. It shows how many times debtors are converted into cash
in a year.

Debtors Turnover Ratio = Net credit sales
Average Debtors

Year Credit sales Average Debtors Ratio


A project report on working capital management of shree dayal tours & travels pvt ltd

A project report on working capital management of shree dayal tours & travels pvt ltd

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to A project report on working capital management of shree dayal tours & travels pvt ltd

Similar to A project report on working capital management of shree dayal tours & travels pvt ltd (20)

More from Babasab Patil

More from Babasab Patil (20)

Recently uploaded

Recently uploaded (20)

A project report on working capital management of shree dayal tours & travels pvt ltd