Flexible Budgeting and Variance Analysis of ‘Shepherd Industry Ltd.’

1. WelcomeTo Our
Presentation
Flexible Budgeting and Variance
Analysis of ‘Shepherd Industry
Ltd.’

2. Presented By
Group No-
Department of Finance,
Jagannath University.
Presented To
Farzana Nasreen
Lecturer
Department of Finance,
Jagannath University.

3. Group List
SL NO. Name Roll
1 Bulbul Hasan Rakib B-140203116
2 Ahsan ahmed sajive B-140203064
03 Md. Mahedi hasan B-140203055
04 Tonmoy Debnath B-140203054
05 Masuma Akter Bethi B-140203077
06 Sumaya Nourin B-140203069

4. Bulbul Hasan Rakib
B-140203116

5. Company Profile
Shepherd Industry Ltd. (SIL) was established in 2000 in Bangladesh as a
private limited company after that it is converted in to a Public Limited Company
on June 08, 2015.
Shepherd Industry Ltd. Is specialized in fancy yarn, yarn-dyeing, garments
dyeing, garments washing, auto stripe knitting fabrics & all kinds of knitting
fabrics.
Main products of Shepherd Industries Ltd. includes: Various types of cotton,
Wool & Nylon.

6. Mission & Vision of Shepherd Industries Ltd.
Mission:
 Achieve goals through teamwork
 Recognize and appreciate a Good job
 Best Customer service & loyalty
 Communicate clearly and listen to one another
 Invest in manpower to reach their full potential

7. Mission & Vision of Shepherd Industries Ltd.
Vision:
 Manufacture international quality Product
 To be customer-focused and globally competitive through better quality
 Use latest technology and continuous innovation.

8. Tonmoy Debnath
B-140203054

9. Products & Customers Of Shepherd Industry Ltd
Main Products
• Cotton Yarn Dying
• Garment Piece Dying
• 100% Nylon Dying
• Garments Wash
Prominent Customers
• Walmart
• MARK & SPENCER
• GAP
• Lee Cooper
• S.Oliver

10. Porter's Five Forces Analysis of Shepherd
Industries Ltd.
Rivalry Amon Existing Firms:
Rivalry among existing Yarn and Dying industry firms is fierce in Bangladesh.
Shepherd Industry’s major competitors include Shasha Denims Limited, Simtex
Industries Limited, Pacific Denims Limited, Far East Knitting & Dyeing
Industries Limited and others.
There are so many rivalry company of Shepherd Industry but their capacity &
Quality of production is poor, so currently Shepherd Industry is leading this
industry in Bangladesh.

11. Sumaya Nourin
B-140203069

12. Threat of new entrants into dying Industry:
Low barriers in the domestic market
Economies of scale are high
Brand identity of a company in this industry is high
Capital requirements to establish a regional or a national level operation are
high
The companies operating at the national level do manage to make economic
profit but entry barriers at this stage are very high.
High capital requirement is not an issue for the international players and thus
the entry of strong international brands in the domestic market is inevitable.
Thus the threat of new entrants is High

13. Bargaining power of Suppliers:
• High availability of cotton
• Low cost of labor
• Differentiation of input is pretty low
• Presence of substitute inputs to cotton like polyester, wool, lycra etc are
present.
• Importance of volume to suppliers is very high.
• Industry is low suppliers is very high.
• Thus bargaining power of suppliers is low.

14. Md. Mahedi asan
B-140203055

15. Bargaining Power of Buyers:
• High demand for apparels and home textiles
• Product differences and brand identity are quite high.
• Buyer concentration is very low
• Ability to backward integrate is very low
• Thus the bargaining power of buyers are low

16. Threat of Substitute:
• Competition from low cost producing
• The threat of substitution from the garments provided by the unorganized
sector is high
• Week supply chain management
• Increasing competition in domestic market

17. Ahsan ahmed sajive
B-140203064

18. SWOT ANALYSIS
STRENGTH:
Brand loyalty.
Market share.
Mass production setup.
Cost conscious business.
Strong R & D for dyeing and finishing.
Low labor cost.
Capital investment availability.
Raw material supply.
Supportive management.
High performance machineries.
Production of value added quality products.

19. SWOT ANALYSIS
WEAKNESS:
Slim profit margin.
Work environment.
Physical Hazards.
Operatives fatigue.
Fragmented company.
Cost of maintenance and spare parts.

20. SWOT ANALYSIS
OPPOURTUNITY:
Helped by the government policy.
Easy Bank loan.
Market orders exports.
New developments in dyes, pigments and chemicals.
Low cost dyes and chemicals.
Mass production capacity.

21. SWOT ANALYSIS
THREATS:
Intense competition.
Government regulation.
Political unrest.
Availability fuel for steam generation.
Social awareness.
High water consumption / effluent generation.
Disposal of solid waste generated from effluent.
High inventory cost.
Chances of high environment pollution.

22. Masuma Akter Bethi
B-140203077

23. SHEPHERD INDUSTRYLIMITED
Statement of Profit or Loss Other Comprehensive Income
For the year ended June 30, 2018
Particulars Actual Amount
(TK.)
Planned
Amount
(Tk.)
variance
Revenue 2,578,968,478 2,575,000,000 3,968,478 F
Less: cost of good sold (2,263,558,771) (2,260,695,500) 2,863,271 U
Gross profit 315,409,707 314,304,500 1,105,207 F
Add : Others income 13,310,997 12,674,150 6,36,847 F
Less: Opera.,selling,Distributive 56,382,049 55,712,000 6,70,049 U
Profit from Operation 272,338,665 271,266,650 1,122,015 F
Less: Financial & IPO Expenses 108,913,558 108,913,558 -
Net Profit before tax 163,425,600 162,353,092 1072508 F
Less: Tax Expense 35,932,600 (35,696,786) 235814 F
Net Profit afterTax for the 127,992,497 126,656,305 1336192 F
Basic EPS (Per value tk.10/) 1.14 1.13

24. SHEPHERD INDUSTRYLIMITED
Statement of Profit or Loss Other Comprehensive Income
For the year ended June 30, 2018
Particulars Actual Amount
(TK.)
Flexible Amount
(Tk.)
Revenue &
Spending
Variance
Revenue 2,578,968,478 2,592,615,050 13,646,572 U
Less: cost of goods sold (2,263,558,771) (2,276,160,457) 12,601,686 F
Gross profit 315,409,707 316,454,593 1,044,886 U
Add : Others income 13,310,997 12,760,850 5,50,147 F
Less: Opera.,selling,Distributive
exp.
56,382,049 55,785,278 596771 U
Profit from Operation 272,338,665 273,430,166 1091501 U
Less: Financial & IPO Expenses 108,913,558 108,913,558 -
Net Profit before tax 163,425,600 164,516,608 1,091,008 U
Less: Tax Expense 35,932,600 36,172,481 2,39,881 F
Net Profit afterTax for the 127,992,497 128,944,127 1,001,630 U
Basic EPS (Per value tk.10/) 1.14 1.15

25. SHEPHERD INDUSTRYLIMITED
Statement of Profit or Loss Other Comprehensive Income
For the year ended June 30, 2018
Particulars Flexible Amount Planned Amount
(Tk.)
Activity
Variance
Revenue 2,592,615,050 2,575,000,000 17,615,050 F
Less: cost of goods sold (2,276,160,457) (2,260,695,500) 15,464,957 U
Gross profit 316,454,593 314,304,500 2,150,093 F
Add : Others income 12,760,850 12,674,150 86,700 F
Less: Opera.,selling,Distributive
exp.
55,785,278 55,712,000 73278 U
Profit from Operation 273,430,166 271,266,650 2,163,516 F
Less: Financial & IPO Expenses 108,913,558 108,913,558 -
Net Profit before tax 164,516,608 162,353,092 2,163,516 F
Less: Tax Expense 36,172,481 (35,696,786) 4,75,695 U
Net Profit afterTax for the 128,944,127 126,656,305 2,287,822 F
Basic EPS (Per value tk.10/) 1.15 1.13 .02 F

26. Conclusion
First of all SHEPHERD INDUSTRY LTD is an established yarn & dying
company in Bangladesh. They are providing best quality product among their
competitors. According to this report SIL is very successful in their business and
there is a chance of established other business by them. According to revenue
& spending variance, activity variance the company is in very good position.

27. Thank You!