SUBMITTED TO

BRHMCHARI WADI TRUST INSTITUTE

OF
BUSINESS ADMINISTRATION
H.K. COLLEGE CAMPUS, ASHRAM ROAD
AHMEDABAD

In partial fulfillment of
S.Y. B.B.A.
Examination by Gujarat University

SUBMITTED BY
SATVARA SANDIP .Y
S.Y.B.B.A
ROLL NO:-2161
ACADEMIC YEAR:-2009-201

1
 *PREFACE*

This corporate world is now becoming more and more competitive.

Regarding this competition business houses need more professionalized
people for their managerial work. Highly professionalized people come from
business school. Business school offers training for all business aspects. So
from this angle our Gujarat University has granted B.B.A. program.

Now a day’s Financial has assumed a status of a science and an art both. The
Finance Function is at the center of the decision making process of a
business unit. It has important and for reaching effects on all managerial
activities.

It is a matter of great pleasure for the students of B.B.A to make report on

the financial condition of different companies. We are 15 students and we
are making a financial report on ‘ELECON ENGINEERING LTD.’ with
great excitement & pleasure.

Many occupy a key position in the capitalization economies of the modern

age. Money is the life blood of modern business. Money is required to
purchase expensive machinery and also for day to day expenses.

2
 *ACKNOWLEDGEMENT*

I feel great pleasure in that filling to all the person who has helped us in
working the way of project report firstly I would like to thank to our
director shri SHILPA TREVADI the director of over Shri
BRAHMCHARI WADI TRUST INSTITUTE OF BUSINESS
ADMINSTRATION. I am very thankful to Gujarat University for taking
the decision of financial report for the students of B.B.A.

I would like to thanks professor AJIT SOLANKI who provided as with

some good suggestions and material to make a project report simple
comprehensive.

3
 INDEX

NO PARTICULAR PAGE
1 CHAPTER
I ) INTRODUCTION

II)Company Profile

III)THE PRODUCTS

IV)ACHIEVEMENTS

V)BOARD OF DIRECTORS

2 CHAPTER
I)RATIO ANALYSIS

II)MEANING

III)IMPORTANCE OF RATIO

IV)CLASSIFICATION OF RATIO

V)CALCULATION OF RATIO

3 CHAPTER

4
 I )THEORY OF CASH FLOW
. ANALYSIS
II)CASHFLOW STATEMENTS

4 CHAPTER
I)STOCK MARKET DATE

5 CHAPTER
I) THEORY OF COMMON SIZE . .
. STATEMENT
II)COMMON SIZE STATEMENT OF
. BALANCESHEET
III)COMMEN SIZE STATEMENT .
. OF P&L A\C
IV)PROFIT & LOSS A/C

V) BALANCE SHEET

6 CHAPTER
I)CONCLUSION

II)SUGGESTION

CHAPTER-1

5
INTRODUCTION

Financial statements, as prepared and presented annually are of little use for
the guidance of prospective investors, creditors or even management. If
relationship between various related items in these financial statements is
established, they can provide useful clue to gauge accurately the financial
health & ability of business to make profit. This relationship between the
two related items of financial statements is known as ratios. It is a
mathematical yardstick that measures the relationship between two figures.

• Introduction of ratio:-
The ratio analysis is a process of comparison of one figure against another
& the interpretation of ratios to know the strengths & weakness of the
firm’s operations & of its financial position. Ratio analysis helps various
interested parties like prospective investors, creditors, banks, and
employees etc. To draw useful conclusions to serve their purpose.

The use of ratios is becoming increasing popular recently. Originally, the

current ratio is used to judge the capacity of the borrowing firm to repay
the loan & to make regular interest payments. Today it has assumed such
an importance that anybody connected with the business turns to ratios for
measuring the financial strength & earning capacity of the business.

6
 Company Profile

Established in 1951, Elecon Engineering Company Ltd of Vallabh

Vidyanagar, Gujarat, India, pioneered the manufacture of material handling
equipment in India. During these four decades, Elecon has designed and
implemented several landmark projects in India as well as abroad.

From a modest start of design and manufacture of Elevators and

Conveyors from which incidently, the company derives its corporate
identity. viz. "Elecon". It has grown over the years to be known as a pioneer
of the concept of mechanised way of Bulk Material Handling Equipment in
India. During the span of more than 4 decades, Elecon has encompassed all
the major core sectors through its supplies of highly sophisticated equipment
bearing ample testimony of the symbolic mark of Elecon's unbeatable
technology. Elecon has thus, made its presence felt through consistent and
satisfactory performance of its equipment in such core sectors as fertilizer,

7
cement, coal/power generation, chemical, steel plant and port mechanisation
etc., across the country.

Brief Introduction Of The Activities Of The Business

Eimco Elecon (I) Ltd. was incorporated in the year 1974 and
was promoted by Environtech Corporation, USA, Elecon Engineering Co.
Ltd. Vallabh Vidyanagar and its Chairman& Managing Director Shri B.I.
Patel .

Eimco Group of Companies Subsidiaries of Environtech USA

are the world leader in production of underground mining machinery having
plants in U.K., USA, Canada, France and Australia. EEIL and Eimco Group
of Companies entered into collaboration under which EEIL received
necessary technical know-how from Eimco Group of Companies for
production of underground mining machineries.

In 1989, Eimco Group of companies were acquired by Tamrock

OY., a world leader in technology and manufacturing of rock excavation and
breaking equipments for surface and underground mines and civil

8
engineering construction with production and assembly facilities in various
parts of the world backed by world wide sales and distribution net work.

Internationally, Tamrock holdes close to 40% market share in

the mining machinery business. It is a leading supplier of drilling and
loading equipments for hard rock applications.

THE PRODUCTS

EEIL produces a very wide range of underground mining

machinery Viz. Air Powered Rocker Shovels, Electro hydraulic Side Dump
Loaders and Electro Hydraulic and Air Powered Load Gaul Dumpers used as
loading machines in both the underground Coal mines and Metalliferous
mines. It also manufactures Air Motors for captive consumption and other
OEM manufacturers, company also manufactures hydraulic Drilling and
Roof bolting jumbos and Auger-cum-Drills and Tugger Hoists. Side Dump
Loaders, Load Haul Dumpers and Auger-cum-Drills forms backbone of the
mechanization system of underground .

9
 NAME OF THE COMPANY:
ELECON ENGINEERING COMPANY LIMITED

REGISTERED ADDRESS OF THE COMPANY:

ANAND-SOJITRA ROAD,

VALLABH VIDHYANAGAR – 388 120

GUJARAT, INDIA.

BRIEF INTRODUCTION OF THE ACTIVITIES OF THE BUISNESS:-

Engineering is one of the India’s leading manufacturers of power

transmission and material Handling Equipment with technology
based products and solution deployed across a wide range of
industrial application ranging from defense, mining power
generation, plastic, sugar and cement amongst others applications
across the world. Elecon strategy for long term growth is based on
customer driven focus and global mindset.

10
 INDUSTRY FIRSTS IN INDIA
First company in India to design, build and erect a Stacker Reclaimed at
Santali PowerStation. First company in India to design, build and erect a
Barrel Reclaimed at Buckaroo Steel. From elevators and conveyors to full
blown bulk material handling solution, Elecon has moved up the value
chain. Over the years Elecon has supplied hi-tech. Material handling
equipment to core industry sectors in steels, fertilizers, cement , power, coal,
lignite and iron ore Mines and Port Mechanization across the globe.

BIRD’S EYE VIEW ON ELECON GEAR DIVISION

They are creating opportunities to expand their potential. They foster
learning and skill development at every level and encourage exchange of
ideas within the enterprise. They are developing and aptitude for excellence
and an attitude that drives continuous improvement.

MANUFACTURING STRENGTH
The division has manufacturing facility spread over 1,17,000 sq. mts.,
housing CNC machine tools for manufacturing and state of the arc test
equipment for quality control.

Have the technology and experience to design, build and erect robust reliable
Material Handling solution for drivers’ industrials segments

11
 ACHIEVEMENTS

Order worth is. 4000 mn from bramhani industries limited for the supply of
plant and equipment for row material handling system. This scope is revised
and new revised order value is rs.3235.40 mn.

Order worth is. 1200 mn from Mundra port & special economy zone ltd.,
Ahmadabad for supply of design , supply, erection, testing and
commissioning of material handling system for west port, Mundra project.

Order worth rs. 724 mn from bharat heavy electrical ltd., commissioning and
pg test of mechanical equipment for 2x250 mw SIKKA TPS project.

Order worth rs. 312.40 mn from tecpro systems limited for supply of
equipment for integrated coal handling plant unit 3 & $ for 2x300 MW Rosa
thermal power project.

Order worth rs. 219.90 mn from adani power ltd., mandra Ahmadabad for
material handling system for adani power limited., Mundra project

12
 GEAR DIVISION
Elecon is Asia’s largest manufacturer of industrial gears and was the first
company in India to introduce modular design concept case hardened and
ground gear technology. Elecon is the gear supplier of choice to core sector
like Sugar, Cement, Steel, Fertilizer, Plastic Extrusion and rubber. Elecon
was the first industrial gear manufacturer in India to achieve ISO – 9001 in
1994 and again the first to achieve ISO- 9001:2000 in 2001.

GROWTH DRIVERS
Capacity augmentation and modernization projects by heavy engineering
industry. Growth in exports and introduction of import situation products.

The demand for the material handling solution has always been high and is
still on a rise, thanks to the tremendous growth in the mining and power
industry in India. More and more investments are expected to pool in with
the implementation of mega projects.

An equal contribution in the growth of the MHE is from the power, steel,
coal, ports and similar industries.

13
 BOARD OF DIRECTORS
The company is managed by the board of directors, which formulates
strategies, policies and reviews its performance periodically. The chairman
& managing director manages the business of the company under the overall
supervision, guidance and control of the board.

1).chairman & Shri prayasvin B. Patel

managing director
2).board of directors 1. Shri Hasmukhlal S. Parikh
2. Dr. Amritlal C. Shah
3. Shri Pradip M. Patel
4. Shri Chirayu R. Amin
5. shri Prashnt Amin(from 29-07-2008)
6. Shri Upendra M. Patel(up to 17-04-2009)
7. Shri Ashok J. Patel(up to 29-04-209)
3).Chief Finance Shri Hemendra C. Shah
Officer
4).Company Secretary Shri Paresh M. Shukla
5).Auditors Thacker Butala Desai

Chartered Accountants

Navsari

14
 CHAPTER-2

Ratio Analysis

Meaning, Importance & Classification of Ratio

Financial analysis is the process of identifying the financial

strengths and weaknesses of the firm by properly establishing
relationship by means of ratios between the items of the balance
sheet and profit & loss account.

Ratio analysis is the most widely used tool of analysis. A ratio

is a quotient of two numbers and is an expression of relationship
between the figures or two amounts. It indicates a quantitative
relationship, which is used for a qualified judgment and decision-
making. The relationship between two accounting figures is known as
accounting ratio.

Meaning: -“The term accounting ratio is used to describe

significant relationship which exist between figures shown in a
balance sheet, in a budgetary control system or in any other part of
the accounting organization.”
Business performance can be measured by use of ratios. Infect
an analysis of financial statements is possible only when figures are
expressed as percentage or ratio. Ratio is of major importance for
financial analysis.

15
 There are two main ways to analyze a ratio:
(1) In a trend analysis, the behavior of the ratio across the time studies.
(2) In a comparative analysis the performance of a firm at a single point
at time relative either to other firms in the industry of five same other
generally accepted industry standard is studies.

Importance of Ratio Analysis:-

(1). Lee observed that the process of producing financial ratio is

essentially concerned with the identification of the significant
accounting data relationship which give the decision maker insights
in to the company that is assessed.
(2). Ratio indicates trends, which will help in decision making and
forecasting.
(3). Ratio analysis helps in assessment of liquidity, profitability and
solvency of the firm.
(4). It indicates the overall operating efficiency and performance of
the firm.
(5). It helps in understanding the financial statements.
(6). It provides basis not only for intra-firm comparison but also
inter-firm comparison.
(7). Comparison of actual ratio with base year ratios or standard ratio
will help the management in controlling the affairs of the firm.
(8). It is powerful tools of financial analysis.

16
CLASSIFICATION OF RATIO :

(A) Traditional Classification

(B) Functional Classification

(A) Traditional Classification:

The ratios are grouped into three categories on the basis of the
statements from which the figures are taken for computing the ratios.
It is well-known traditional classification and has been so grouped
since the advent of ratio analysis. The ratios according to this
classification are:

(1)Revenue Statement Ratios :

These are the ratios computed on the basis of items taken from
revenue statement i.e. profit and loss account. E.g. net profit ratio is
computed by dividing net profit by sales. Here both net profit and
sales are items appearing in profit and loss account.

(2)Balance Sheet Ratios :

When two items or groups of items appearing in the balance sheet are
compared the ratios so obtained is a balance sheet ratio. E.g. a ratio
establishing relationship between current assets and current liabilities
is a balance sheet ratio .

(3)Composite Ratios :

17
A ratio showing the relationship between one item taken from
balance sheet and another taken from profit and loss account is
composite ratio or a combined ratio known as balance sheet and
revenue statement ratio. A return on capital employed shows the
proportion of net profit to capital employed and it is a composite
ratio.

(B) Functional Classification :

Ratios are also grouped in accordance with certain tests. On

this basis there are four categories of ratios.

(1) Liquidity Ratios:

These Ratios indicate the position of
liquidity. They is computed to ascertain whether the company is
capable of meeting its short-term obligations form its short term
resources. For example, current ratio shows the capability of a firm to
meet its current liabilities as and when they mature. E.g. (1) Current
Ratio (2) Liquidity Ratio (3) Acid-Test Ratio.

(2) Profitability Ratios

A number of ratios are designed to indicate the
profitability of the business of the grouped into the category of
profitability ratios. For example, Return on capital employed Ratio.
E.g. (1) Gross profit ratio (2) Net profit ratio (3) Expenses ratio (4)
Operating ratio (5) Return on capital employed ratio (6) Return on
shareholders funds (7) Debt service coverage Ratio.

(3) Leverage Ratios:

18
 The composition of capital of business and the
proportion of Owner’s capital and capital provided by outsiders are
reflected by leverage ratios. For example, gearing ratio showing the
relationship between the preference capital and ordinary capital is a
leverage ratio. E.g. (1) Proprietary Ratio (2) Debt –Equity Ratio (3)
Gearing Ratio (4) Fixed Capital- Fixed Assets Ratio.

(4) Activity or Efficiency Ratios :

These are the ratios showing the effectiveness with

which the resources of the business of the employed. It signifies the
efficiency of management. For example, stock turnover is active ratio,
showing the number of times the average stock is turned over during the
year. E.g. Debtors ratio or turnover, Creditors ratios or Turnover, Total
Assets Turnover, Fixed Assets Turnover, etc

19
1) G P Ratio 1) Return on Capital
Employed

2) N P Ratio 2) Return on
Shareholders Fund

3) Expense Ratio 3) Return on Equity

Shareholders Fund

4) Operating Ratio 4) Return on Equity

Share Capital

5)Earnnig per share

6)divend per share

7)Price earning ratio

8) Dividend Yield Ratio

20
 (1) CURRENT RATIO
DEFINITION:This ratio shows the proportion of current assets and
current liability. It is a measure of working capital available at a particular
time. This ratio obtained by dividing current assets by current liabilities. The
Ideal standard for this ratio is 2:1.

. FORMULA

21
 CURRENT RATIO = CURRENT ASSETS / CURRENT LIABILITIES

(Rs in laces)
YEARS 2006-2007 2007-2008 2008-2009
CURRENT ASSETS 60871.21 80963.70 100845.90
CURRENT 25558.94 35003.64 43177.28
LIABILITY
RATIO 2.38 2.31 2.34

Current Ratio
2.5
2
1.5
Ratio 2.38 2.31 2.34 2009
1
2008
0.5
2007
0
2007 2008 2009
Year

COMMENTS:
This implies that the company is having enough working capital to meet the
short term liabilities which can be considered well enough for the company.
It is generally believed that 2:1 current ratio shows a comfortable working
capital position. Here, in 2006-07 it is 2.38 and in 2007-2008it is slightly
decrease and reach 2.31 and in 2008-09 it is increases 2.34 this ratio is quit
satisfactory in three.

(2) INTEREST COVERTAGE RATIO

DEFINATION: The ratio indicates as how many times the profit covers
the payment of interest on debenture & other long term loans. Hence it is
known as “Time –interest earned ratio”. It measures the debt service
capacity of the firm with respect to fixed assets on long term debts.

FORMULA:

22
INTERESCOVERAGRATIO=PROFIT BEFORE INTEREST & TAX INTEREST /
(Rs in laces)
YEARS 2006-2007 2007-2008 2008-2009
PROFIT BEFORE INTEREST 10377.1 12610.57 13646.83
& TAX
INTEREST 1936.35 2742.66 4836.80
RATIO (IN TIMES) 5.35 4.60 2.82

Current Ratio
6
5
4
Ratio 3 5.35 2009
2 4.6
2.82 2008
1 2007
0
2007 2008 2009
Year

COMMENT:
The ratio indicates as to how many times the profit covers the payment of
interest on debentures and other long term loan. In 2006-2007 it was 5.35
and it is decreasing 2007-2008 and 2008-2009 respectively 4.60 and 2.82 in
all three year it is decreasing trend it is not desirable to meet financial
strength of the company.

(3)GROSS PROFIT RATIO:

DEFINITION:It is ratio expressing relationship between gross profits
earned to net sales. It is useful indication of the business. This ratio usually
expressed as a percentage. If this ratio is high it indicates that cost of sales is
low and if this ratio is low that the cost of sales is high.

FORMULA:

23
GROSS PROFIT RATIO = GROSS PROFIT /SALE × 100
(Rs in laces)

YEARS 2006-2007 2007-2008 2008-2009

GROSS 49862.03 59906.12 73747.68
PROFIT
SALES 75995.82 83209.29 86538.48
RATIO (IN %) 65.61% 71.99% 85.21%

Gross Profit Ratio

100.00%
80.00%
60.00%
Ratio
85.21% 2009
40.00% 65.61% 72%
2008
20.00%
2007
0.00%
2007 2008 2009
Year

COMMENT:

Here there is high ratio in 2006-2007 is 65.61 so it is good mark of the

management of the company. It means there is low production cost. But
from 2007-2009 it seems to be decreasing which can be debatable issue.

(4) NET PROFIT RATIO:

DEFINITION :This ratio is valuable for the purpose of ascertaining the
overall profitability of business and shows the efficiency of operating the
business. It is the reverse of operating ratio. This ratio indicates what portion
of sales revenue is left to the proprietors after operating expenses are met.

24
FORMULA:

NET PROFIT RATIO = NET PROFIT AFTER INTEREST & TAX SALES* 100 /
(Rs in laces)
YEARS 2006-2007 2007-2008 2008-2009
NET PROFIT 5490.30 6720.42 5745.12
SALES 75995.82 83209.29 86538.48
RATIO (IN %) 7.22 8.08 6.64

Net Profit ratio

10.00%
8.00%
6.00%
Ratio
8% 2009
4.00% 7.22% 6.64%
2008
2.00%
2007
0.00%
2007 2008 2009
Year

COMMENTS:
The above picture implies that the efficiency of profit earning of the
company is decreasing at an increasing rate as the net profit ratio is
decreasing from 8.08 % to 6.64 % for the last three years. Here the
profitability of the company seems to be diminishing.

(5) DEBT EQUITY RATIO:

DEFINITION:This ratio is only another for of opportunity ratio and
establishes relationship between the outside long term liabilities and fund.

FORMULA:
DEBT EQUITY RATIO = LONG TERM LIABILITIES OWNERS FUND /
25
 (Rs in laces)
YEARS 2006-2007 2007-2008 2008-2009
LONG TERM 28365.94 40926.09 59208.20
LIABILITIES
OWNERS FUND 18790.37 23672.62 27540
RATIO (IN %) 1.51 1.73 2.15

Debt Equity Ratio

2.50%
2.00%
1.50%
Ratio
1.00% 2.15% 2009
1.51% 1.73%
2008
0.50%
2007
0.00%
2007 2008 2009
Year

COMMENTS:

The higher ratio suggests that out side creditors have larger claim than the
owner of the company in 2006-2007 the ratio1.51 % and it is increasing
respectively in 2007-2008 and 2008-2009 by 1.73 % and 2.15 % it shows
vary pour condition of the company.

(6) RETURN ON CAPITAL EMPLOYED:

DEFINATION: It is an index of profitability of business .It is obtained by
comparing net profit with capital employed. This ratio is normally expressed
in the percentage. Here profit after interest and tax is considered.

FORMULA:
R.O.C.E = NET PROFIT BEFOR INT & TAX / CAPITAL EMPLOYED ×100
26
 (Rs in laces)
YEARS 2006-2007 2007-2008 2008-2009
N.P.B.I.&.TAX 10377.1 12610357 13646.83
CAPITAL 47156.31 64598.71 86748.20
EMPLOYED
RATIO(IN : 1) 22.01 19.52 15.73

Return on Capital Employed

25
20
15
Ratio
10 22.01 19.52 2009
15.73 2008
5
2007
0
2007 2008 2009
Year

COMMENTS:

In the year 2006-2007 ratio is 22.10 which shows high profitability of the
company. In year 2007-2008 it goes down by 19.52 by 15.73 in 2008-09.
This concludes that the profitability is decreasing slowly.

(7) ADMINISTRATIVE EXPENCES RATIO:

DEFINATION:This ratio over a number of year will reveal the extent to
which the expenses either increase or decrease in relation to sales.

FORMULA:
AD.EX.RATIO=ADMINISTRATIVE EXPENSES / NET SALES *100
(Rs in laces)

27
YEARS 2006-2007 2007-2008 2008-2009
AD.EXPENSES 323.00 387.61 315.00
NET SALES 66646.54 73067.58 78961.32
RATIO (IN %) 0.48 0.49 0.40

Administrative Expanses Ratio

0.50%
0.40%
0.30%
Ratio 0.48% 0.49% 2009
0.20% 0.40%
2008
0.10%
2007
0.00%
2007 2008 2009
Year

COMMENTS:-

A high expense ratio is not desirable as it means that only a small part of
sales revenue is available for meeting financial liabilities like interest taxes
dividends etc.

(8) SELLING EXPENSES RATIO:

DEFINATION:This ratio shows that the high expenses ratio is desirable as
it means only a small part of sales revenue is available for meeting financial
abilities.

FORMULA:

28
SALLING EXP. RATIO = SALLING EXP /NET SALES × 100

(Rs in laces)

YEARS 2006-2007 2007-2008 2008-2009

SALLING 514.33 380.16 298.87
EXPENSES
NET SALES 66646.54 76067.58 78961.32
RATIO (IN %) 0.81 0.49 0.38

Selling Expanses Ratio

1.00%
0.80%
0.60%
Ratio
0.40% 0.85% 2009

0.20% 0.49% 0.38%

2008
2007
0.00%
2007 2008 2009
Year

COMMENTS:

The table & chart determine that the ratio so decreasing. So here capital
structure is desirable.

(9) RETURN ON SHAREHOLDERS EQUITY

DEFINITION: This ratio indicates how profitability. The funds provided by

the owners have been used in business. It tells the inventors whether he
could get higher return or not.

FORMULA:
RETURN ON SHAREHOLDERS FUND= NET PROFIT AFTER TAX *100

29
 SHARE HOLDIERS FUND

(Rs in laces)
YEARS 2006-2007 2007-2008 2008-2009

NET PROFIT AFTER TAX 5490.30 6720.42 5745.12

SHARE HOLDERS FUND 18790.37 23672.62 27540.00
RATIO (IN %) 29.22 28.39 20.86

Selling Expanses Ratio

0.80%
0.60%
Ratio 0.40% 0.77% 2009
0.52% 2008
0.20% 0.38%
2007
0.00%
2007 2008 2009
Year

COMMENTS:-
The ratio indicates how profitably the funds provided by the owners have
been used in business it tells the investors whether he would get higher
returns. In the year 2006-2007 ratio is 29.22. In year 2007-2008 it goes down
by 28.39 & by 20.86% in 2008-09. This concludes that the profitability is
decreasing slowly.

(10) STOCK TURNOVER:

DEFINITION:The number of times the average stock is turned is known
as stock turnover. It is computed by dividing the cost of goods sold by the
average stock. Average stock is obtained by adding closing stock and
operating stock and dividing them by two.

FORMULA:
STOCK TURNOVER = COST OF GOODS SOLD / AVERAGE STOCK

30
 (Rs in laces)
YEARS 2006-2007 2007-2008 2008-2009
COST OF GOODS 49862.03 59906.12 73747.68
SOLD
AVERAGE STOCK 740.80 1022.83 2031.49
RATIO (IN TIMES ) 67.31 58.57 36.30

Stock Turnover Ratio

70
60
50
40
Ratio
30 67.31 58.57 2009
20 36.3 2008
10 2007
0
2007 2008 2009
Year

COMMENTS:
This ratio shows the number of times the average stock is turned over
during the year. Here in this case the company can be considered in a good
position.

(11) PROPRITARY RATIO CHART:

DEFINITION:The ratio shows the proportion of proprietors fund to the
total assets employed in the business. The proprietor’s fund of share holder’s
equity consists of share capital and reserve. The higher the ratio the stronger
the financial position of the enterprise.

FORMULA:
PROPRIETORY RATIO = PROPRITORS FUND / TOTAL ASSETS * 100

31
 (Rs in laces)

YEARS 2006-2007 2007-2008 2008-2009

PROPRITORS 47156.31 64598.71 89748.20
FUND
TOTAL ASSETS 74348.93 101215.99 133034.63
RATIO (IN:1) 63.43 63.82 65.20

Propritery Ratio
70
60
50
40
Ratio
30 63.43 63.82 65.2 2009
20 2008
10 2007
0
2007 2008 2009
Year

COMMENTS:
Here the proprietor’s ratio is diminishing respectively from 63.43 to 63.82
for the year before. However in the last year it is 65.20 but it cannot be
considered as a substantial as higher the ratio the stronger financial position.

(12) FIXED ASSETS TURNOVER:

DEFINITION: To ascertain the efficiency and profitability of business.
The total assets are computed by sales. The more the sales in relation to the
amount invested in fixed assets.

FORMULA:
FIXED ASSETS TURNOVER = SALES / TOTAL ASSETS

32
 (Rs in laces)
YEARS 2006-2007 2007-2008 2008-2009
SALES 75995.82 83209.29 86538.48
FIXED ASSETS 12673.75 19306.74 31101.93
RATIO (IN :1) 6.00 4.31 2.78

FIXED ASSETS TURNOVER

6
5
4
Ratio 3 6 2009
2 4.31
2.78 2008
1 2007
0
2007 2008 2009
Year

COMMENTS:

We can say that the sale is almost near or equal to the assets. It determined
by this ratio as the ratio remains near to 1 which indicates a good enough
efficienc.

(13) DIVIDEND PER SHARE:-

DEFINITION:Dividend per share is the amount of actual dividend paid
to equity shareholders divided by number of equity share outstanding.

FORMULA:
DIVIDEND PER SHARE =TOTAL DIVIDEND PAID SHARE /NO. OF EQUITY
SHARE

(Rs in laces)
Particular 2006-07 2007-08 2008-09
Dividend paid to 463.85 1392.92 1392.92

33
 equ.shares
No. of equity shares 863.25 928.61 928.61
Ratio 0.54 1.50 1.50

Divedend Per Share

1.5

1
Ratio 1.5 1.5 2009
0.5 2008
0.54
2007
0
2007 2008 2009
Year

COMMENTS:

This ratio shows the actual dividend paid to equity

shareholders dividend by the number of equity share outstanding.Here 2007
paid dividend 0.54 camparesain 2008 & 2009 paid dividend 1.5.

(14)Quick/ Acid test Ratio :-

DEFINITION:The measure of absolute liquidity may be obtained

by only cash and bank balance as well as ready marketable securities
with Liquid liabilities.

FORMULA:
ACID TEST RATIO = QUICK ASSETS / LIQUID LIABILITIES

PARTICULAR 2006-07 2007-08 (Rs 2008-09

in laces)
Quick Assets 43975.47 55703.33 60771.24

Liquid liabilities 2558.94

34 35003.64 43177.28

Quick Ratio 1.72:1 1.59:1 1.41:1

 Acid Test Ratio
2
1.5
Ratio 1 1.72 2009
1.59 1.41
0.5 2008
2007
0
2007 2008 2009
Year

COMMENTS:

From the above calculations we can say that in the years 2006-07and 2007-
08 the acid test ratio was not quite satisfactory and in 2008-09 it decreased to
1.41 which is not good for the company itself.

(15)EARNNIG PER SHARE

DEFINITION:The ratio is obtained by dividing net profit after

deduction of preference dividend by number of Equity share. Earning
per share measures the profit available to equity shareholders on per share
basis.

FORMULA:

EARNING PER SHARE=PROFIT AFTER TAX - PREF.DIVIDEN /NO. OF

EQUITY SHARES .

35
 2006-07 2007-08 2008-09

PAR 5490.30 6120.42 5745.12

No. of Equity shares 863.25 928.61 925.61

Earning per share . (RS) 6.36 7.24 7.24

Earning Per Share

8
6
Ratio 4 7.24 7.24 2009
6.36
2 2008
2007
0
2007 2008 2009
Year

COMMENTS:There is a lot of decrease in the EPS in the year2007-08 in

compring with 2008-09, which shows bad sign for the company and for the
share holders also.

(16) DEBTORS TURNOVER RATIO:

DEFINITION

The debtors’ turnover suggests the number of times the amount of

credit sales is collected during the year while debtor’s ratio indicates the no.
of days during which the due for credit sales are collected.

FORMULA:

DEBTORS TURNOVERRATIO = CREDIT SALES / AVERAGE DEBTORS

36
 (Rs in laces)

Particulars 2005-06 2006-07 2007-08

CREDIT SALES 66646.54 73067.58 78961.32

AVERAGE 38798.60 49231.61 47173.58

DEBTORS
RATIO 1.72 1.48 1.67

Dabtors Turnover Ratio

2
1.5
Ratio 1 1.72 2009
1.48 1.67
0.5 2008
2007
0
2007 2008 2009
Year

COMMENTS:

The debtors raio or the average collection period indicates the efficiency
otherwise of the collection department . if 30 days is taken be average
collection period.show the unsatisfactory credit and collection policy.

(17) Long Term fund to Fixed Asset:

DEFINITION

The total fixed asset are compared to long term fund .The more the sales
relation to the amount invested in fixed assets, more efficient is the use of
fixed assets.

FORMULA:

37
 Long Term Fund to Fixed Asset = Long Term Fund / Fixed
Asset

(RS IN lacs)
Particulars 2006-07 2007-08 2008-09
Long Term Fund 47156.31 64598.71 86748.20

Fixed Assets 12673.75 19306.74 31101.93

Ratio 3.72 3.35 2.79

Long Term Fund To Fixed assets Ratio

4
3
Ratio 2 3.72 2009
3.35
2.79
1 2008
2007
0
2007 2008 2009
Year

COMMENTS:
This ratio show the compring 2007-2009 ratio3.27&2.79 . This ratio is
satisfactory becuas long term fund decares.

(18) OPERATING RATIO

DEFINITION:
It is ratio that shows relationship between cost of goods sold plus operating
expenses to sales. Operating expenses induce administrative and selling and
distribution expenses.

FORMULA:

38
 OPERATING RATIO = COST OF GOODS SODL + OPERATING EXP NET /
SALES
(Rs in laces)

Particulars 2006-07 2007-08 2008-09

c.og.s 49862.03 59906.12 73747.68
operating Exp 65188.09 78464.26 98203.81
Net sales 66646.54 73067.58 78961.32
Ratio 172.62 189.37 217.77

Operating Ratio
250
200
150
Ratio
100 189.37 217.77 2009
172.62
2008
50
2007
0
2007 2008 2009
Year

COMMENTS:
It is a ratio that shows relationship between cost of goods sold plus operating
expenses to sales . Compring 2007 ratio172.62 & 2009 ratio of
217.77 operating expenses inceares.

(19) TOTAL ASSETS TURN OVER

DEFINITION:
The funds used in business are employed in both fixed
assets and current assets both and profit is earned with the help of the both.
Hence it would be useful to know the proportion total assets to sale.

FORMULA:

39
TOTAL ASSETS TURN OVER = SALES / TOTAL ASSEST
(Rs in laces)

Particulars 2006-07 2007-08 2008-09

Sales 75995.82 83209.29 86538.84

Total assets 74348.93 102215.99 133034.63

Ratio 1.02 0.82 0.65

Total Assets Turnover Ratio

1.2
1
0.8
Ratio 0.6 1.02 2009
0.4 0.82
0.65 2008
0.2 2007
0
2007 2008 2009
Year

COMMENTS:
Thus against the total assest of Rs 1 the sale is of 2007-08-09 ratio
1.20,0.82,0.65 ratio is useful in indicating the overall efficincy of
business.The turnover ratiothe more efficientis utillisation of assets.

(20) FINANCIAL EXPENSE RATIOS

DEFINITION:
For the purpose of asceraitaining relationship between operating expenses
and sales expense ratio are computed. Financial expenses in relation to net
sales are all expenses ratios.

FORMULA:

40
 FINANCIAL EXPENSE = FINANCIAL EXPENSE /NET SALES× 100

(Rs in laces)

Particulars 2006-07 2007-08 2008-09

FANANCIAL EXP 8834.52 10290.29 12315.50
Net sales 66646.54 73067.58 78961.32
Ratio 13.25 14.08 15.59

FINANCIAL EXPENSE

20
15
Ratio 10 3-D Column 4
13.25 14.08 15.59 2009
5
2008
0
2007
2007 2008 2009
Year

COMMENTS:
These expenses either increase or decrease in relation to sales .Here 2007
ratio 13.25 & 2009 ratio15.59 increase so sale alos increase.

CHAPTER-3

THEORY OF CASH FLOW ANALYSIS:-

41
MEANINGS:-
“Cash flow statement is a historical statement which shows that what the
cash inflow was and cash outflow during the last year what was the actual
cash balance on hand at the end of last year.”

UTILITIES OF CASH FLOW STATEMENT:-

(1)EFFICIENT CASH MANAGEMENT:-

If the finance manager has clear idea if cash receipts and payments, cash
resources can be efficiently managed. If the cash payments are planned at a
time, when enough cash inflow is likely, it is possible to manage business
with minimum of working capital.

(2)USEFUL FOR INTERNAL FINANCIAL MANAGEMENT:-

The management can plan out payment of dividend, repayment of long term
loans, and purchase of machine or equipments.

(3)INFORMATION ABOUT CASH RECEIPTS AND PAYMENTS:-

Such a statement will give information about the trend of cash receipts and
payments. Such information is useful to the management in meeting any
future contingencies and also I seizing any profitable opportunity.

42
 (4)USEFUL FOR CONTROL:-
The historical cash flow statement prepared for last year is useful for
comparing the figures of cash budgets and points of differences may be
located. This facilities managerial control on the use of cash.

(1) EASE IN OBTAINS FUNDS:-

By comparing the figures of cash flow statement and cash budgets, the cash
planning and control becomes more effective. Liabilities are easily paid as
when they mature and this improves the prestige of the firm in the market.

CASHFLOW STATEMENTS:-
2007 2008 2009

Particulars amount amount amount amount amount Amount

(A)CASH FLOW
FROM OPERATING
ACTIVITIES:-

43
1)Net profit before interest
and tax, extra ordinary
items & profit on loss of
assets and investments

10391.86 12628.50 13675.37

2)Adjustment for :

-depreciation 1419.80 1222.30 2214.71

-interest income (79.87) (190.94) (534.64)

-dividend income (87.76) (60.20) (71.77)

-gratuity - - 201.38

971.16 1252.37 1809.68

Operating profit before

working capital changes

11363.02 13880.87 15485.05

3)adjustment for working

capital changes

-trade & other receivables

*trade receivables

*loan & advances

-trade & other payables

(17380.99) (10433.01) 2058.03
*trade payable
(901.26) (1559.37) (930.12)
*advances

-inventories

5114.42 7130.70 641.58

44
 (1330.94) 641.15 7384.34

(505.14) (8364.62) (14814.29)

(15003.91 (12585.15) (5660.46)

)

CASH GENERATED
FROM OPERATIONS

(3640.79) 1295.72 9824.59

4)LESS: direct taxes paid

(2519.40) (3242.13) (2587.92)

(2519.40) (3242.13) (2587.92)

ADD: prior period

adjustment
(0.74) - -

NET CASH BEFORE

EXTRA ORDINARY
ITEMS
(6161.03) (1946.41) 7236.67

5) Deferred exp.

- technical knowhow fees

(51.92) (75.11) (111.62)

NET CASH FLOW

FROM OPERATING
ACTIVITIES(A)

(2021.52) 7125.05

(6212.95)

45
(B)CASH FLOW FROM
INVESTING
ACTIVITIES

-Purchase of fixed assets

-sales of fixed assets

-purchase of investment (4431.39) (8193.85) (14017.74)

-sales of investment 272.05 144.38 18.17

-return of share
application of money (175.30) (141.58) (141.25)
-interest income - 91.45 0.99
-dividend income 1

1.11 - -

190.94 79.67 534.64

60.20 87.76 71.77

NET CASH FLOW

FROM INVESTING
ACTIVITIES(B)
(4082.39) (7932.16) (13533.42
)

(C) CASH FLOW

FROM FINANCING
ACTIVITIES

-issued of equity capital

-proceeds from long term

borrowings 3577.10 45.28 -
-repayment against long
term borrowings
4986.09 8229.08 16300.26
-proceeds from other
borrowings

46
-repayment against other (6667.77) (2635.03) (4487.39)
borrowings

-interest paid
10176.12 23219.02 39731.45
-dividend paid

(695.01) (16221.18) (33263.97)

(1934.44) (2665.49) (4900.73)

(341.54) (541.67) (1617.62)

NET CASH FLOW

FROM FINANCING
ACTIVITIES(C)
9100.55 9430.01 11762.00

(D)EQUIVALENT
CASH(A+B+C)
(1194.79) (523.66) 5353.63

(E)CASH
EQUIVALENT
2470.69 1275.90 752.24

(F)CASH
EQUIVALENT(D+E)
1275.90 752.24 6105.87

Comments:
This statement is showing cash inflow and out flow of the company it
distributed as a cash flow with regard to assets and liabilities. if assets of the
company are increase than cash flow is decrease and if assets are decrease
than cash flow is increase and if liabilities are increase cash flow increase
and if liabilities are decrease cash flow is decrease. In short cash flow and
assets are negatively related while cash flow and liabilities are positively
related. cash flow for non cash items or before change in working capital for
the year 2006-07 is 11363.02 and for the year 2007-08 is 13880.87 lacks,

47
and for the year 2008-09 is 15485.05 lacks. It is showing that the cash flow
from non cash item is continuously increasing this is good for the company.
The changes working capital for the three same years is -3640.89, 1295.72
and 9824.59 laces respectively. Net cash flow from operating activity is
-6212.95, 2021.52 and 7125.05 for three consecutive years. For the last three
years company’s net cash flow from operating activities is continually
increasing.

Cash flow from investing activity is -4082.39, -7932.16 and -13533.42rs. In

laces for three years. Cash out flow is more because of more purchase of
fixed assets.

Cash flow from financing activity for the three years 9100.55, 9430.01 and
11762.00 laces respectively. Cash inflow by issuing of share capital for the
year 2006-07 is 3577.10 laces and for 2007-08 are 45.28 laces.

For the year 2006-07 there is decreasing is net cash and cash equitant by
1194.79 laces and the for the year 2007-08 it was 523.66 laces. And for the
year 2008-09 is increasing in cash and cash equitant it was 5353.63. Opening
and closing balance for the year 2006-07 is 2470.69 and 1275.90
respectively. while for the year 2007-08 it was 1275.90 and 752.24
respectively, and for the year 2008-09 it was 752.24 and 6105.87
respectively.

CHAPTER-4
STOCK MARKET DATE

48
MONTH HIGH LOW VOLUME HIGH LOW VOLUME

April-2008 200.0 166.4 1721850 200.9 166.1 2007593

0 0 5 5

May-2008 171.9 122.0 3035414 178.4 121.9 3526880

5 0 0 0

Jun-2008 127.0 90.10 3159685 125.7 91.15 2840683

0 0

July-2008 105.0 80.15 1674183 104.8 78.50 1794349

0 0

August-2008 128.3 88.50 6750728 128.5 88.95 7531973

0 0

September- 124.3 84.25 1368197 124.3 85.00 1491694

2008 0 0

October-2008 93.00 36.25 2033633 94.90 36.00 2446206

November-2008 51.45 34.15 1769655 94.90 34.10 4592628

December-2008 40.90 29.50 3229761 39.90 29.50 2922818

January-2009 46.10 34.00 1857541 46.40 34.15 1657974

February-2009 37.60 28.75 1109015 46.40 28.70 2660621

March-2009 32.45 23.85 2622457 32.35 23.75 3143171

49
 BSE NSE

COMMENTS:-
Given above is the upper lower situation of the share market and stock
market of the Elecon co. ltd. In given situation data is given last 1 year. And
the price on given y axis and the month is given x axis. The NSE sensex

50
April 2008 is 200 and it is also March 2009 is 32.45 in high level. In low
level situation the stock market data is April 2008 is 166.40 and March 2009
is 23.85.

The NSE sensex of high level is in April 2008 is 200.95 and March 2009 is
32.35 and low level situation market data is in April 208 is 166.15 and
March 2009 is 23.75. So the stock situation is as also good.

CHAPTER-5

THEORY OF COMMON SIZE STATEMENT:-

INTRODUCTION:-
Financial statements when read with absolute figures are not easily
understandable sometimes they are even miss-leading. It is therefore,
necessary that figures reported in these statements should be converted into
percentage to some common base. In profit and loss account sales figures are
expressed as percentage of sales. Similarly, in balance sheet the total of
assets or liabilities is taken as 100 and all figures re-expressed as percentage
of the total. This type of analysis is called vertical analysis. This is a static
relationship because it is a study of relationship existing at a particular date.
The statements so prepared are called common size statement.

MEANING:-

51
There is not any financial statement which would provide any common base
with which all items in each statement can be compared. For this purpose
common size statements are prepared in which all items are compared with
one common item, which is significant. The significant item would be
considered here as 100% & all other related items are rated on the bases of
this significant item. Therefore the common size statements are sometimes
known as “100 per cent statements”.

There are two types of common size statements prepared:-

(1) Balance sheet as common-size statement,

(2) common-size profit & loss a/c.

UTILITIES OF COMMON-SIZE STATEMENTS:-

The common size statement gives useful proportions of each component to
the total. But they are not of each use, as they do not give information about
the trends of individual items from year to year. They must be used along
with trend percentages & individual items from year to year. They must be
used along with trend.

However, common-size statement are found to be very useful for

comparison of two business enterprises at a certain data e.g. the common-
size balance sheet of a company reveals that its owned funds are 65% &
outside liabilities are 35%. The common- size balance sheet of other
company shows that its owned funds are 48%, while its outside liabilities are
52%. The

52
comparison makes it clear that the first company is financially sounder that
the other one, as it mainly depends upon its own funds for carrying on the
business, while the other company carries on its activities chiefly with the
help of outside funds.

COMMON SIZE STATEMENT OF BALANCESHEET

PARTICULAR 2006-07 2007-08 2008-09

SHARE CAPITAL 1.27 2.8 2.06
RESERVE SURPLUS 37.21 32.9 28.54
SECURED LOAN 54.73 48.40 58.16
UNSECURED LOAN 3.35 13.32 7.6
DEF.TAX LIABILITIES 3.59 2.81 3.64
100.15 100.23 100
(TAX ASSET) -0.15 -0.23
100 100 100
FIXED ASSETS 25.95 29.12 34.55

53
INVESTMENT 1.65 1.43 1.21
CURRENT ASSETS 124.65 122.10 112.02
DEF. EXPENDITURE 0.09 0.14 0.19
152.34 152.79 147.97
(CURRENT LIABILITY) -52.34 -52.79 47.97
100 100 100

common size statment of balance

300 sheet
250
200
RATIO

150
100
50
0 2008-09(%)
2007-08(%)
Ad ploy r

st

ng on
l
r i es

In e
m e

k
r c es

is s
ia

m we

tiv
of om

ee

oc
(-) De tere
er
rg

i
he sal

t
Po

tra

ia

st

2006-07(%)
at
ha

nc

cr rec
t
Ne

in

p
e

si
m
um th

ea
n
ot

io
pt
d

de
an
n

ns
tio

Co
ec
Er

PARTICULARS

COMMENTS:-
The balance sheet shows the percentage of each liability to the total liability
and capital. Such percentages give only the change in proportion of one item
to one main item like sales or total assets. But it fails to indicate whether the

54
financial position or performance over a period of some years is improving
or deteriorative.

Here, in this case, the proportion of net sales to total sales in 2006-07, 2007-
08, and 2008-09 is 91.44%, 87.38% and 81.86% respectively. The
proportion of other income to the total income for the same three years is
1.13%, 1.17% and 0.99%. There is a continually rise in total income this is
showing good position of the company. The proportion of c0nsumption of
the material to total is 77.65%, 81.22& and 84.13% respectively.

COMMEN SIZE STATEMENT OF P&L A\C

PARTICULAR 2006-07 2007-08 2008-09

NET SALES 91.44 87.38 81.86
ERECTION CHARGES 7.43 11.45 17.15
OTHER INCOME 1.13 1.17 0.99
100 100 100
CONSUMPTION EXP. 77.65 81.22 84.13
POWER 0.97 0.92 0.81
EMPLOYEES 4.22 4.65 5.00
ADMINISTRETIVE 13.76 13.95 14.02
INTEREST 3.02 3.72 5.52
DEPRETIATION 1.90 1.93 2.53

55
 101.52 106.39 112.04
(DECRESE STOCK) -1.52 -6.39 -12.04
100 100 100

COMMENTS:-

The balance sheet shows the percentage of each liability to the total liability
and capital. Such percentages give only the change in proportion of one item
to one main item like sales or total assets. But it fails to indicate whether the
financial position or performance over a period of some years is improving
or deteriorative.

Here, in this case, the proportion of fixed assets to total assets in 2006-07,
2007-08, and 2008-09 is 29.12%, 25.95% and 34.55% respectively. The
proportion of current assets to the total assets for the same three years is
122.1%, 124.65% and 112.02%. There is a continually rise in fixed assets
this is showing good position of the company. The proportion of current
liabilities to total is 52.79%, 52.34& and 47.97% respectively. The

56
proportion of share capital to total for the three consecutive years is 1.27%,
2.6% and 2.06% respectivel

PROFIT & LOSS A/C

(RS IN LACES)

PARTICULARS 2006-2007 2007-2008 2008-2009

Income
Sales 75995.82 83209.29 86538.48
-Excise duty 9349.28 10141.71 7577.16
Net sales 66646.54 73067.58 78961.32
Income From Operation
Net sales 66646.54 73067.58 78961.32
+Erection & Other charges 5417.98 9575.93 16545.16
72064.72 82643.51 85506.48
Other Income 823.65 978.66 957.72
139534.71 156689.75 86464.2
Expenditure
Cost of good sold
Building 319.14 317.85 200.85
Materials 433.86 536.78 646.98
Salaries & Wages 2241.33 2756.75 3735.40
Contribution to provident fund 116.21 129.26 154.25
Employees Welfare expenses 199.71 303.74 162.72

57
 Employees retirement benefits 151.36 238.00 330.85
3461.61 4282.38 5231.05
Interest
On fixed period loan 338.87 631.57 1064.82
On working capital 1304.17 1532.23 3110.96
On Others 293.31 578.86 611.02
1936.35 2742.66 4836.80
Selling Expenses
Traveling Expenses 193.96 340.62 343.56
Packing ,forwarding & distribution 713.13 866.08 600.27
expenses
Commission & brokerage 3246.49 3607.93 4219.48
Bad debts written off 976.07 779.31 588.26
Liquidated damages 335.97 890.46 395.32
Advertisement & Sales Promotion 213.29 471.46 411.14
Expenses
Donation 71.43 47.93 443.64
5750.34 6993.94 7001.67
Administrative Expenses
Other Expenses 63.88 50.27 62.34
Insurance 109.67 104.57 134.91
Bank charges 520.58 605.55 912.59
Directors fees 7.85 9.00 7.20
Rectification Expenses 72.63 56.08 51.30
Payment to Auditors 13.33 15.43 21.21

58
 Lease Rentals 9.28 37.58 443.64
Royalty paid - 31.11 13.73
Technical Inspection Fees 14.72 18.77 1.81
Other professional fees 342.14 489.84 900.85
General Administrative Charges 568.24 502.99 769.58
1722.33 1921.29 3319.16
General Expenses
Rent 8.60 28.01 8.03
Computer software charges 94.53 140.27 165.69
Rates & taxes 219.87 229.33 141.28

Excises duty 285.86 122.92 149.56

658.86 520.53 464.56

Profit before tax 9867.91 8810.03

Profit after Tax 6720.42 5745.12

Dividend per share 17.00 17.00 71.77

Earning per share 2.00 2.00 6.19

BALANCE SHEET

59
 PARTICULAR 2006-07 2007-08 2008-09
Equity share capital 61847000 185723000 185723000
Reserve surplus 1817190,000 218539000 2568277000
Net worth 1819037000 2367262000 37540,000
Long term _
Debenture _
Loan form bank 26272857000 3209106000 5236092000
Loan form financial institute 163737000 883503000 684728000
Net different tax 167695000 171076000 327803000
4883326000 6630947000 9002623000
TOTAL
ASSETS
Fixed assets 1267375000 1930674000 3110193000
Capital working
Total fixed assets 1267375000 1930674000 3110193000
Current assets
Stock 168957400 2526037000 4007466000
Cash bank 12759000 75224000 61057000
Debenture 387966000 4923161000 471735800
Loan and advance 402629000 571948000 749179000
Total current assets 6087121000 8096370,00 1009637000
0 0
Current assets with out loan advance 568492000 752442000 9347191000
Investment 80337000 94555000 108680,000
Less-current liability 2501625000 3289479000 4086705000
Add-provision 54269000 210885000 231023000
Net working capital 3531227000 4596006000 576685200
Different expenditure 4327000 9712000 16888000
4883326000 6630947000 9002623000
TOTAL

CHAPTER-6

Conclusion:-

60
 I have prepared this report on the bases of the information
available in the balance sheet of ELECON ENIGINEERING (INDIA)
LTD.

From the above discussion conclude that of ELECON

ENIGINEERING (INDIA) LTD. has a good future. The company has
good technology for its product.

Total profit of company is increasing in last year and also a

total sale of the company is increasing continuously from last three
years. The amount of dividend declared by the company is increasing
year by year.

The company is also engaged in a project of overseas which

helps the company in its growth.

According to me, ELECON ENIGINEERING (INDIA) LTD. is

doing a excellent business and so it becomes profitable company and very
popular company.

SUGGESTION:-

61
 The company’s all ratios are good and should maintain it and it should
be taken into consideration. Liquid assets must be maintained in order to
maintain the liquidity ratio.

62