KSDL 1

A STUDY ON WORKING CAPITAL
1.1 Introduction about the Internship

One of the most important areas in the day to day management of the firm is the management
of working capital. Working capital management is the functional area of the finance that
covers all the current accounts of the firm. It is concerned with management of the level of
individual of current assets as well as the management of total working capital. Financial
management means procurement of funds and effective utilization of these procured funds.
Procurement of funds is firstly concerned for financing working capital requirement of the
firm and secondary for financing fixed assets.
1.2 Study of working capital

Ordinary, there term working capital stands for that part of the capital, which is required for
the financing of working or current needs of the company. Working capital is the lifetime of
every concern. Whether it is manufacturing or non- manufacturing one without adequate
working capital, there can be no progress in the industry.
Inadequate working capital means shortage of raw material, labour etc., resulting in partial
current assets less current liabilities-has no economic meaning in the sense of implying some
type of normative behavior. According to this line of reasoning, it is largely an accounting
artifact. Working capital management, them, is a misnomer
The working capital of the firm is not managed. The term describes a category of
management decisions affects specific types of current assets and current liabilities. In turn,
those decisions should be rooted in the overall valuation of the firm.
1.3Need for the study

The pipes production serves as the index of the economic development of any country. Thus
PVC pipes production is very vital from countrys agricultures point of view. The demand
would be grown with increasing technologies and is likely to reach a staggering level in the
decades to come.
BGS INSTITUTE OF TECHNOLOGY, BG NAGAR
Page 1
On the other hand the price of the pipes as remained stagnant, because prices are determined
market forces and presently production levels are greater than supply.
A number of industries for the past of few years have been finding it difficult to solve the
increasing problems of adopting seriously the management of working capital. Business
concerns intent on developing their business have to use to be at most, their available
resources for the development of the business, thereby enabling them profits.
Due to inflationary situations and restrictions imposed on borrowing facility, the commercial
institutions and manufacturing industrial units have been confronting and difficulties in
meeting day to day financial needs. Hence effective management of working capital becomes
the problem for such organization and industries. The purpose of study is to examine analyze
and evaluate working capital management and its components in KARNATAKA SOAPS
AND DETERGENTS LTD.
1.4 Objectives of the study
To study the statement of changes in working capital

To analyze the profitability liquidity position of the company
To examine and evaluate cash receivables and inventory management performances
1.5 Scope of the study
1.6 Methodology adopted

1.7 Review of the literature
1.8 Limitations
At most of the financial information was considered confidential, the access to the
information was restricted

The results of the study are limited information
Page 2
Due to frequent and work load of the staff in the sufficient organization much time
could not be by them project

The project is based mainly secondary sources of information
2.1 INDUSTRY PROFILE

Soap is one of the commodities which have become an indispensable part of the life of
modern world. Since it is non durable consumer goods, there is a large market for it. The
whole soap industry is experiencing changes due to innumerable reasons such as government
relations, environment, energy problems and increase in cost of raw materials etc.
The changing technology and ever existing desire by the individual and the organization to
produce a better product at a more economical rate has also acted as catalyst for dynamic
process of change.
More and more soap manufacturers are trying to capture a commanding market share by
introducing and maintaining acceptable products. The soap industry in India faces a cut throat
competition while multinational companies dominate the market. They are also facing severe
threat from dynamic and enterprising new entrance especially during 1991- 1992.
If we look back into the history of soaps and detergents, mankind knew about Esoap, when
roasted meat over flowed on the glow in ashes. The lump like product was soap and had
foaming and cleansing character. In 1192 A.D. the first patent for making soap was taken in
London.
THE INDIAN SOAP INDUSTRY SCENARIO
The Indian has soap industry been dominated by handful of companies such as
1. Hindustan levers limited.
2. Tata oil mills
3. Godrej soaps private limited.
4. Recent entrants include- colgate Palmolive limited
-proctor and gamble limited
Page 3
-Nirma soaps limited

-Wipro limited
The Indian soaps industry continued to flourish very well and until 1967-68 but began
to
Stagnate. Soon it started to recover and experienced a short upswing in 1974. This
Increases in demand can be attributed to:
1. Growth of population
2. Income and consumption increase
3. Increase in urbanization
4. Growth in degree of personal hygiene
In India, the first soap company was established by North West Soap Company in 1897 at
Meerut following the Swadeshi movement. From 1905 onwards few more factories were
setup.
They are,
Mysore soap factory at Bangalore.
Godrej soap factory at Bombay.
Bengal Chemicals.
Tata Oil Mills.
Lever Brothers Company.
THE INDIAN SOAP INDUSTRY SCENARIO
Page 4
The Indian soap industry has been dominated by long time with number of companies such
as,
Hindustan Levers Limited.
Tata Oil Mills Limited.
Godrej Soaps Private Limited.
The Indian soap industry continued to flourish very well until 1967-1968, but began to
stagnate and soon it started recovering. In 1974 it experienced a short upswing. This increase
in demand is due to,
Growth in population.
Increase in Income and consumption.
Urbanization.
Growth in degree of personal hygiene.
Soap manufacture has two classifications namely,
Organized sectors.
PRESENT STATUS:
Market scenario:
Indian is the ideal market for cleaning products. The countries per capita consumption
Of detergent powders and bars stands at 1.6kg and soap at 543gms Hindustan lever, which
heralds over the cleaning business, sells in all over the cleaning business but the tiniest of
Indian settlements. The 7.4lakhs tons per annum soap market in india in crawling al
PROBLEMS OF SOAPS AND DETERGENTS INDUSTRY
Page 5
Industry faces some problems due to increase in the cost of raw material. The major
ingredients like soda ash, linear alkyl benzene and sodium triply phosphate poses number of
serious in terms of availability. The demand and supply gap of vegetables oil is 1.5 to 2lakh
and is met through imports.
MARKET SCENARIO
India is the ideal market for cleaning products. The Indian soap market is pseudo in nature
and it is amazingly complex being segmented not only on the basis of price benefits, but even
range emotions within that outlining framework.
PROBLEMS OF KSDL
Soap industry has some problems in case of raw materials. The major ingredients are soap
ash, linear alkyl, benzene and sodium. Tripoly phosphate poses number of serious problems
in terms of availability. The demand supply gap for vegetable oil is 1.5 to 2 lakh tons and is
met through imports. In recent times, caustic soda and soap ashes in the cheaper varieties of
soaps are quite high.
2.2 COMPANY PROFILE
Mysore Sandal Soap is a brand of soap manufactured by the Karnataka Soaps and Detergents
Limited [KS&DL], a company owned by the Government of Karnataka in India. This soap
has been manufactured since 1916 when Nalvadi Krishna raja Woodier, the king of Mysore
set up the Government Soap Factory in Bangalore. The main motivation for setting up the
factory was the excessive sandalwood reserves that the Mysore kingdom had which could not
be exported to Europe because of the First World War. In 1980, KS&DL was incorporated as
a company by merging the Government Soap Factory with sandal oil factories at Shivmoga
and Mysore. Mysore Sandal Soap is the only soap in the world made from 100% pure
sandalwood oil. KS&DL owns a proprietary geographical indication (GI) tag on the Mysore
sandal soap which gives it intellectual property rights to use the brand name, to ensure quality
and also prevent piracy and unauthorized use by other manufacturers. In 2006, Mahendra
Singh Dhoni, the Indian cricketer was selected as the first brand ambassador of the Mysore
Sandal Soap.
HISTORY
Page 6
In the early 20th century, the Mysore kingdom in India was one of the largest producers of
sandalwood in the world. It was also one of the major exporters of the wood, most of which
were exported to Europe. During the First World War, large reserves of sandalwood were left
over because they could not be exported due to the war. In order to make good use of these
reserves, Nalvadi Krishnaraja Wodeyar, the king of Mysore took the advice of his diwan,
Sir.M.Visweshwaraiah and established the Government Soap Factory in Bangalore. This
factory which was set up in 1916, started manufacturing soaps under the brand name Mysore
Sandal Soap using sandalwood oil as the main ingredient. A factory to distill sandalwood oil
from the wood was setup at Mysore in the same year. In 1944, another sandalwood oil factory
was setup in Shivmoga. After the unification of Karnataka, these factories came under the
jurisdiction of the Government of Karnataka. In 1980, the Government decided to merge
these factories and incorporate them under a company named Karnataka Soaps and
Detergents Limited.
RENAMING OF THE COMPANY
On October 1st 1980, the Government Soap Factory was renamed as KARNATAKA SOAPS
AND DETERGENTS LIMITED. The company was registered as a Public Limited
Company. Today the company produces varieties of products in toilet soaps, Detergents,
Agarbathis and Talcum powder. KS&DL has been built up with tradition for the quality of its
products. Mysore Sandal Soap is the No.1anywhere in the world. The Karnataka state is the
original home of the sandal oil, which uses original perfume sandalwood in the
manufacturing of Mysore Sandal Soaps.
2.3 Promoters
Sales department
Production department
Finance department
Human resources management
Research and development
Page 7
Re-engineering
Marketing department
2.4 VISION, MISSION AND OBJECTIVES
Vision Statement :
Karnataka Soaps & Detergents Limited has a clear Vision for all round development of the
Company. This is reflected in the form of a well conceptualized and cogent blue print called
VISION 2013. The VISION 2013 sets the goals and suggests the strategies and plans
necessary to achieve the Vision. The Vision of the KS&DL is embodied in the following
statement:"KARNATAKA SOAPS & DETERGENTS LIMITED WILL LEVERAGE LATEST
SOAP MANUFACTURING TECHNOLOGY AND INFORMATION TECHNOLOGY BY
IMBIBING PROFESSIONAL MANAGEMENT TECHNIQUES TO IMPROVE ITS
FUNCTIONAL ACTIVITIES, TRANSPARENCY, BUSINESS AND TO TRANSFORM
ITSELF INTO A MODERN, PROFESSIONAL ORGANIZATION IN THE FMCG
MARKET IN INDIA AND ALSO TO SPREAD ITS FRAGRANCE IN THE FMCG
GLOBAL MARKET".
MISSION STATEMENT
To serve the national economy.

To attain self reliance.
To promote purity and quality product
To maintain the brand loyalty of its customers.
To build upon the reputation of Mysore Sandal Soap based on pure sandal oil.
OBJECTIVES
To promote and uphold its image as a symbol of traditional products.

To build upon the reputation of Mysore Sandal Soap based on pure sandal oil.
To supply the products at most reasonable and competitive rate.
Page 8
To maintain the brand loyalty of its custom
2.5 PRODUCT AND SERVICES PROFILE

KS&DL is the true inheritor of golden legacy of India. It is continuing the tradition of
excellence for over eight decades, using only the best East Indian grade Sandalwood oil &
Sandalwood soaps in the world. The products produced at KS&DL are the Soaps, Detergents,
Agarbathis and Sandalwood oil.
TOILET SOAPS
NAME OF THE PRODUCT
UNITS OF GRAMS
Mysore Sandal Soap
75, 125
Mysore Sandal Classic Soap
75
Mysore Sandal Gold Soap
75, 125
Mysore Sandal Baby Soap
75
Mysore Special Sandal Soap
75
Mysore Rose Soap
100
Mysore Sandal Herbal Care Soap
100, 125
Mysore Jasmine Soap
100
Wave Soap
100
Mysore lavender Soap
150
Mysore Sandal bath tablet
150
Mysore Sandal Classic Bath Tablet
150
Mysore Jasmine Bath Tablet
150
Mysore Special Sandal Tablet
150
Mysore Sandal rose Tablet
150
Mysore Sandal Guest Tablet
17
Mysore Sandal Millennium
150
Page 9
DETERGENT
NAME OF THE PRODUCT
UNITS IN GRAMS
Mysore Detergent Powder
1000
Mysore Detergent Powder
500
Mysore Detergent Cake
125
Mysore Detergent Cake
TALCUM POWDER
NAME OF THE PRODUCT
UNITS IN GRAMS
Mysore Sandal Talc
20,50,100,300
Mysore Sandal Baby Talc
100,200,400
AGARBATHIS
Page 10
Paraijata
Alif Laila
Meditation
PRODUCT RANGE FROM THE HOUSE OF MYSORE SANDAL SOAP
a. MYSORE SANDAL SOAP

b. MYSORE SANDAL BATH TABLET
c. MYSORE SANDAL BABY SOAP
(75gms,125gm
(150gms)
(75gms)
Page 11
d. THREE-IN-ONE GIFT PACK (SJR) 3TABS

(150gmseach)
e. MYSORE SANDAL GOLD SOAP
f. MYSORE ROSE SOAP
(100gms,125gms)
Page 12
g. MYSORE SANDAL GOLD SIXER 6 TABS
h. SIX-IN-ONE GIFT PACK 6TABS
(125GMS EACH)
(125GMEACH)
MYSORE LAVENDER SOAP -150 GMS
i. MYSORE SANDAL CLASSIC SOAP
j. MYSORE HERBALCARE
(75GMS)
(15GMS, 75GMS,
100GMS)
Page 13
k. MYSORE JASMINE SOAP
(75GMS,
100GMS)
MYSORE SANDAL MILLENNIUM
(150GMS)
Page 14
DETERGENTS
KSDL also manufacture high quality detergents applying the latest spray drying technology
with well balanced formulation of active matters and other builder, they provide the ultimate
washing powder.
Sensor Detergent Powder (1kg/2kg)
Mysore Detergent Powder (1kg/500gms)
Mysore Detergents Bar (250gms)
Mysore Detergent Cake (125gms/250gms)
MYSORE DETERGENT CAKE
Mysore Detergent Cake is formulated with special dirt - busters for effective removal of
toughest dirt on clothes and to give freshness with mild aroma all the day, while wearing. The
product is available in variants like - 150gms and 250gms under the brand name of MDC.
Page 15
AGARBATHIS
a. JASMINE REGULAR
b. MEDITATION
SANDAL
c. NAGA CHAMPA
Page 16
d. ROSE REGULAR
e. SIR.M.V-100
f. JASMINE ROLLS
SANDALWOOD OIL
Page 17
POWDERS
a. MYSORE SANDAL TALCUM POWDER
b. MYSORE SANDAL BABY POWDER
MYSORE SANDAL ROOM FRESHNER
Page 18
MYSORE SANDAL DHOOP
MYSORE SANDAL BILLETS
Page 19
LIQUID DETERGENT - KLEENOL
WAVE COLOGNE POWDER
LIQUID SOAP
Page 20
2.6 AREAS OF OPERATION

HUMAN RESOURCE DEPARTMENT
STRUCTURE OF HUMAN RESOURCE DEPARTMENT
MANAGING
DIRECTOR [M. D]
ASST.GEN.MGR
[HRD]
MGR [HRD]
FIRST
AID
TIME
OFFICE
ASS.MGRS
CANTEEN
VMO
ASS.MGR
JR. OFFICER
OFFICER
SR.
JR.OFFICER
SENIOR
ASSTS
JR.OFFICER
ASST.
Page 21
HELPER
SR.ASSTS
ATTENDER
SR.ASSTS
Cooks
ATTENDER
Helpers
01
M.D
Managing Director
02
ASST.GEN.MGR
Assistant General Manager [HRD]
03
MGR [HRD]
Manager [HRD]
04
ASST.MGR
Assistant Manager
05
LWO
Labor Welfare Officer
06
VMO
Visiting Medical Officer
07
OFFICER [HRD]
Officer [HRD]
08
JR. OFFICER [HRD]
Junior Officer [HRD]
09
SR. ASSTS
Senior Assistants
10
ATTENDER
Attender
11
COOKS
Cooks
12
HELPERS
Helpers
Luther Gulick highlighted PODSCORB which stands for planning, organizing, staffing,
directing, coordinating, reporting and budgeting is the part of human resource management.
FUNCTIONS OF HUMAN RESOURCE DEPARTMENT
Recruitment and Selection.
Training and Development.
Page 22
Promotion and Transfer.
Wage and Salary administration.
Performance appraisal.
Industrial relations.
Disciplinary action.
Welfare measures.
Maintain personnel records.
Study on labor turnover.
Verification of cash certificate, character and attitude.
Compilation of periodical report to various statutory authorities.
Maintenance of manpower inventory.
Maintain of SC/ST roster.
Study on absenteeism and suggesting measures.
Coordinating dispute cases before conciliation labor court and other court.
Grievance handling.
MANPOWER DETAILS
Group
Bangalore
Sandalwood
oil
Marketing
division branches
[Mysore]
Duty
paid Total
gowdon
[Shivmoga]
Executives
78
08
53
02
141
Supervisors
49
08
15
72
Workers
523
28
36
14
601
Total
650
44
104
16
814
Page 23
BENEFITS PAYABLE TO THE EMPLOYEES
Shift allowance: There are three shifts and one general shift. The shift timings are as
follows.
First Shift
6.00am to 2.00pm
Second Shift
2.00pm to 10.00pm
Third Shift
10.00pm to 6.00am
General Shift
9.30am to 5.30pm
The lunch time is from 12.00pm to 12.30pm. Every Sunday is rest day for the employees. No
allowance is paid to the first shift workers. A sum of Rs.25 and Rs.35 per day is paid to workers
for second and third shift respectively.
Washing allowance: The company provides two sets of uniform once in a year. For this a
washing allowance of Rs.50 per month is paid to every worker.
Conveyance allowance: The conveyance allowance of Rs.680 per month per worker is
extended.
Family travel allowance: This allowance is paid at the rate of Rs.500 per employee per year
who has put a minimum three years of service.
Death relief fund: Rs.30, 000 will be paid to the nominee in case of death of an employee.
Memento to retiring employee: Rs.2, 500 will be paid as memento to retiring employees.
Medical reimbursement: Benefit to non-ESI employees a sum of Rs.500 per month will be
paid per employee towards domiciliary treatment. With regards to hospitalization treatment
the company has taken medical claim policy from insurance company for a sum of Rs.1,
50,000 per employee which includes spouse and two children.
Page 24
PAY SCALE OF UNIONISED EMPLOYEES

SL.NO
GROUP
REVISED PAY SCALE
01
5140-110-1690-140-6390-170-7240-200-8240
02
II
5250-110-5690-140-6360-170-7240-200-8240-240-9440
03
III
5690-140-6390-170-7240-200-8240-240-9440-280-10840
04
IV
5970-140-6390-170-7240-200-8240-240-9440-280-10840-33012490
05
6110-140-6390-170-7240-200-8240-240-9440-280-10840-33012490-400-14490
06
VI
6390-170-7240-200-8240-240-9440-280-10840-330-12490-40014490-500-15990
07
VII
7240-200-8240-240-9440-280-10840-330-12490-400-14490-50017990
08
VIII
8240-240-9440-280-10840-330-12490-400-14490-500-17990-60019190
Page 25
PAY SCALE OF OFFICERS
SL.NO
DESIGNATION
REVISED PAY SCALE
01
JR.OFFICER
10000-100-10500-300-12300-350-14400400-16800-450-18150
02
OFFICER
10800-300-12300-350-14400-400-16800450-19500-525-20025
03
ASST.MANAGER
14050-350-14400-400-16800-450-19500525-22650-600-25050
04
MANAGER
18150-450-19500-525-22650-600-26250675-26925
05
ASST. GEN. MANAGER
20025-525-22650-600-26250-675-28275
06
DY. GEN. MANAGER
22125-525-22650-600-26250-675-30300
07
GEN. MANAGER
24450-600-26250-675-30300-750-31800
08
DIRECTOR
26250-675-30300-750-34800-850-36500
DUTIES OF A MANAGER
Maintenance of attendance book of employees and various departments.
Promotion or demotion of labors according to their quality of their work.
Attending the problems faced by the workers while working.
She sees that every employee is satisfied with the job.
RECRUITMENT
Recruitment will be done by newspapers, through employees for workers.
For executives staffs, recruitment will be done through newspapers, internet and consultancy
and through employees.
Page 26
SELECTION
Workers will be selected by daily according to the requirement for the company. Workers should
have to bring age proof like S.S.L.C marks card. For the executive staff the selection process will
be done in the head office.
TRAINING
Training will be given to the new workers for 40 days, if the worker is trained up well, then they
will be placed for batches.
FINANCE DEPARTMENT
STRUCTURE OF FINANCE DEPARTMENT
MANAGING
DIRECTOR
GENERAL
MANAGER
DEPUTY GENERAL
MANAGER
ASSITANT
GENERAL
MANAGER
Page 27
BILLS/COS
TING
JR.
OFFICERS
SR.ASSITAN
T
JR.ASSITAN
T
CHIEF
MANAGER
A/CS
AM
PA TO GM
SUPER
[A/CS]
JR.OFFICE
RS
SR.ASSIT
ANT
SR.ASSITA
NT
OFFICER
SUPER
[COSTING]
SR.ASSITAN
T
JR.ASSITAN
T
JR.ASSITANT
Finance is the life blood of every organization. It is concerned with managerial decision making.
This department is concerned with proper utilization of cash. It identifies the source of finance
where to borrow i.e. ICICI, IRBI, IDBI, Corporation bank etc.
It has abundant of function which can be enumerated as follows:
Effective funds management which is inverted in beneficial projects.
Decision making regarding fixing of cash account.
Obtaining trade credit.
Profit maximization.
Wealth maximization.
Preparation of cash budgets.
Systematic approach to working capital management.
Page 28
Pricing of raw materials and valuation of stores.
To protect financial interest of the company.
AUDIT DEPARTMENT
KS&DL audit wing is headed by internal auditor. Auditing is vital for the company as it
facilitates verifying of all the books of account by trial balance, it also comply with requirements
for central excise and income tax purposes. After the auditors monitor everything they give
report which is helpful to the company.
COSTING
When a company does costing it ensures proper fixation of selling price of the product, cost
control it also help in taking decision. KS&DL use process costing as the production mechanism
is systematic it involves addition of a lot of ingredient in the manufacturing.
OBJECTIVES
Planning for short term and long term financial requirements of the organization.
Managing short and long term receivables and payables.
Managing capital both long term and short term.
Issuance and redemption of ownership and creditor ship securities [shares and debentures]
Safe custody of funds and securities.
Cash planning and credit management.
Providing top management with information on current and prospective financial conditions
of the business of the enterprise as a basis for policy maki
PRODUCTION DEPARTMENT
Page 29
STRUCTURE OF PRODUCTION DEPARTMENT
GENERAL
MANAGER
SENIOR
MANAGER
MANAGER
MANAGER
MANAGER
DEPUTY
MANAGER
WORK
MANAGER
SENIOR
ENGINEER
ENGINEER
WORKERS
KS&DL has three production plants. They are,

1. Fatty Acid Plant.
Page 30
2. Soap Plant.
3. Detergent Plant.
FATTY ACID PLANT

The basic raw materials, oils and fats undergo the splitting and refining process including
hydrogenation at the fatty acid plant. It is also obtained and used for soap making. The plant has
a capacity to process 10,000mt of oil and fats.
SOAP PLANT
The soap plant is one of the largest production plants in the country with an installed capacity of
26,000 tons per annum.
KS&DLs soap plant has its uniqueness that it has the capacity to process as many as ten
different varieties of soap simultaneously. The sophisticated plant from Italy has a wholly
integrated straight line facility that links up process sequence for higher productivity. It is a
stream line flow through right from raw material preparation to wrapping stage the line collation
with the built in facility for continuous fat bleaching and saponification. The high speed auto
wrapper has the capability to handle the soaps of virtually all size and shape.
DETERGENT PLANT
It has installed capacity of 10,000 tons per annum. To produce spray dried, powder and a syntax
plant for detergent cakes and bars. It produces industrial detergent which is used in the
formulation of wet table pesticide powders for crop protection.
WORK FLOW MODEL

SILOS (Silos are closed chambers)
Soaps noodles
Page 31
Container mixer
Simplex plodder
It becomes noodles
Millin
It becomes soap ribbons
Duplex plodder
Cutting machine
Cakes are led
Stamping machine
Wrapping machine
Led through the conveyor belt
MARKETING DEPARTMENT
STRUCTURE OF MARKETING DEPARTMENT
MANAGING
DIRECTOR
GENERAL
MANAGER
DEPUTY GENERAL
MANAGER
ASST.
GENERAL
MANAGER
PRODUCT
PRODUC
MANAGE
T
BGS INSTITUTE
OF
TECHNOLOGY,
BG
NAGAR
R [DET]
MANAGE
R
OFFICER
SR.ASST
JR.ASST
ASST.MG
ASST.MG
ASST.
GENERAL
MANAGER
MGR
[MRIS]
ASST.MG
R
SR.ASST
JR.OFFIC
JR.ASST
Page 32
JR.OFFI
CER
MGR
[SALES]
ASST.MGR
OFFICER
JR.OFFICE
R
SR.ASST
JR.ASST
The company main products are soaps and detergents which are sold in different parts of India.
There are depots at various places of the country which are controlled by six branches. The
role of each branch is to ensure that the sales activities are under their control.
Page 33
BRANCH
DEPOTS
Bangalore
Hubli, Raichur.
Chennai
Salem, Madurai, Cochin
Hyderabad
Vijayawada, Ananthapur
Mumbai
Bhiwandi, Ahmedabad, Pune
Kolkata
Cuttack, Patna, Gauhati
Delhi
Jallander
FUNCTIONS OF MARKETING DEPARTMENT
Marketing mix: It is the policy adopted by the manufacturers to get success in the field of
marketing.
Product policy: It includes both the development and improvement produced and existing
products. This all totally done by KS&DL both marketing and research and development
department.
Distribution policy: The manufactured product of KS&DL is supplied to the various depots.
Sales and Promotion: It takes necessary steps for promoting its products.
EXPORTS
Page 34
KS&DL export their products to different parts of the world they are,
Australia.
Berlin.
Canada.
France.
Germany.
Italy.
Kenya.
Malaysia.
Saudi Arabia.
Singapore.
Africa.
Srilanka.
USA.
Japan.
Page 35
UK
MATERIALS DEPARTMENTSTRUCTURE OF MATERIALS DEPARTMENT
DEPUTY GENERAL
MANAGER
MGR
[PACKING &
ENGG]
JR.OFFI
CER
[PACKIN
SR. ASST
[MISC]
SR.ASST
[PERFUM
E]
ASST.MG
R
[ENGG]
JR.ASS
T
JR.ASST
OFFICER
[CHE &
OILS]
SR.ASST
[OILS &
CHEM]
WORKER
S
FUNCTIONS OF MATERIALS DEPARTMENT

1. Maintaining continuous flow of materials.
Page 36
2. Effective control of inventories.

3. Coordination.
4. Growth of the organization.
5. Maintaining ethical organization.
It has been divided into five sections as follows,

1. Oil and fats section.
2. Perfumery and aromatically section
3. Packing materials section.
4. Chemical section.
5. Miscellaneous and Engineering section.
According to Waterman, organization change is not simply a matter of structure, although

structure is significant variable in the management of change. Again it is also not a simple
relationship between strategy and structure, although strategy is also a critical aspect. In their
view effective organizational change may be understood to be a complex relationship between
strategy, structure, system, style, skills & shared values. The first three elements-strategy,
structure &system are considered the hardware of success. The next four style skills, staff,
and shared values are called the software. The complex relationship is diagrammatically
presented below;
SKILLS
The term skills includes those characteristics, which people use to describe a company.
Organization have strengths in a number of area but their key strengths are dominant skills are
few. These are developed over a period of time of the result of the interaction of a number of
factors performing certain tasks successfully over a period of time, the kind of people in the
Page 37
organization, the top management style, structure, the management systems, the external
environmental influence etc. Hence when organization makes a strategic shift it becomes
necessary to consciously build new skills.
Employees skills in an organization will be unique, this may be due to their experience in the
place of work, and the similarity may also due to influence of the similar culture.
However every person according to his traits possesses his own talents and special characters.
This cannot be generalized skill among them.
The employees of KS&DL have different skill, which are relevant for their work. As it is
common in big organizations, he also controversies between departments which can be solved by
discussions and by conducting some interactive programs.
STYLE OF MANAGEMENT:
Decision-making is centralized with the head office. Authority is given to unit in-charge to take
decision in day-to-day minor matters & other urgent matters.
Decision-making depends on the authority & responsibility conferred on each individual & thus
its distributed based on designation & position held.
In important matters, meetings are held to seek opinions of top management & various
department manager & the decisions are taken & implemented. Decision-making is co-ordinate
& done with wide consultations of top management of department managers consultation which
gives best possible gains.
STRATEGY:
Strategic planning is about asking questions, more than attempting to answer them. Strategy
formulation entails a search for a different frame of reference. It is the quest for a new business
paradigm. There are two types of paradigms that apply to management, namely the business and
the organizational or managerial paradigms. The business paradigms define a companys position
in the market place with respect to customers, technology and products.
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Strategy is a choice of direction and action; the company adopts to achieve its objectives in a
competitive situation. Any statements on overall of functional strategy that the company may
wish to share are:
Improvement in the existing products.
Their future plans include launching of new products.
The cost control exercise is in consolidation.
Introduction of cost effective substitutes without compromising on quality
Development of new perfumes, soaps detergents, Agarbathies, creams and shampoos.
STAFF:
As any employer, KS&DL follow ethical employment standards wherever it operates with a
goal in mind company guarantees.
1. To fulfill its entire legal obligation in terms of employment payments and benefits practices.
2. Adequate and timely training for every one for the job for which they are employed.
3. Career advancement related to performance and experien
SHARED VALUES:
Values:
Values refer to the institutional standards of behavior that strengthen commitment to the vision,
and guide strategy formulation and purposive action. The core values are shaped around the
belief that enterprises exist to serve society. In terms of this belief, profit is a means rather than
an end in itself a compensation to owners of capital linked to the effectiveness of contribution to
society and the essential ingredient to sustain such enlarged societal contribution.
Thus company has embraced an extended role of trusteeship that reaches beyond the assets
reflected in the balance sheet to encompass societal assets. An unwavering commitment to
integrity, ethical conduct, meritocracy, teamwork and abiding concern for stakeholders are at the
heart of your companys value system.
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Customer satisfaction
Committed to total quality.
Cost and time-consciousness.
Innovation and creativity.
Trust and team spirit.
Respect for individuals.
Integrity health and ethics.
2.8 COMPETITORS OF KS&DL PRODUCTS AND SERVICES

KS&DL is facing cut throat competition in national and international market. Some of its
main competitors are,
Hindustan Unilever Limited.
Godrej Soaps Private Limited.
Proctor and Gamble.
Wipro.
Nirma Soaps Private Limited.
Jyothi Laboratories.
COMPETITORS INFORMATION AND MARKET SHARE IN SOAP INDUSTRY
Page 40
NO.
PARTICULARS
PERCENTAGES
1.
HUL [Hindustan Unilever Limited]
64%
2.
KS&DL
11%
3.
Proctor & Gamble
10%
4.
Godrej Soaps Private Limited
4%
5.
Wipro
4.6%
6.
Others
6.4%
TRADEMARK OF KS&DL
The SHARABHA
The carving on the cover is the Sharabha, the trademark of KS&DL.
The Sharabha is a mythological creation from the puranas which has a body of a lion and
head of an elephant, which embodies the combined virtues of wisdom and strength. It is
adopted as an official emblem of KS&DL to symbolize a power that removes imperfections
and impurities. The maharaja of Mysore as his official emblem adopted it. And soon took
place as the symbol of the Government Soap Factory of quality that reflects a standard of
excellence of Karnataka Soaps and Detergents Limited.
SLOGAN
Page 41
NATURAL PRODUCTS WITH EXOTIC FRAGRANCES

KS&DL has a long tradition of maintaining the highest quality standard, right from the
selection of raw materials to processing and packaging of the end product. The reasons why
its products are much in demand globally and are exported regularly to UAE, Saudi Arabia,
Kuwait, Qatar, South America. The entire toilet soaps of KS&DL are made from raw
materials of vegetable origin and are totally free from animal fats.
POLICY OF KS&DL
Seek purchase of goods and services from environment responsible suppliers.
Communicate its environment policy and best practices to all its employees.
Set targets and monitor progress through internal and external audits.
Strive to design and develop products, which have friendly environmental impact during
manufacturing.
Reuse and recycle materials wherever possible and minimize energy consumption and
waste.
BIRDS EYE VIEW OF KS&DL

1918- Government Soap Factory was started by Maharaja of Mysore and the Mysore Sandal
Soap was introduced into the market for the first time.
1950- The factory output rose to 500M.Tons with the following modifications
Renovating the whole premises.
Installing new boiler soap building plant and drying chamber.
1954- Received license from Government to manufacture 1500 tons of soaps and 75 tons of
glycerin per year.
1957- Factory shifted its operation to Rajajinagar industrial area.
Page 42
1974- Mysore sales international limited was appointed as the sole selling agent, for
marketing its products.
1975- Rs. 4 crores synthetic detergent plant was installed based on Italian technology by
Ballestra SPA.
1980- On 1st October 1980 the Government Soap Factory was converted into a public sector
enterprise and renamed as Karnataka Soaps and Detergents Limited
1981- A. Production capacity was increased to 6,000 tons
B. Rs. 5 crores Fatty acid plant was installed.
1984- Manufacturing of premium quality of Agarbathis at Mysore division.
1985- Production capacity was raised to 26,000M.tons per annum. A large variety of toilet
soaps at attractive shapes, colors and fragrances introduced to meet the varieties and tastes of
consumers.
1992- The company was registered with the Board for Industries and Financial
Reconstruction (BIFR), New Delhi in December for rehabilitation, as the company suffered
losses continuously since 1980 at its net worth eroded.
1996- The BIFR approved the rehabilitation scheme in September and the company started
making profits.
1999- ISO-9002 Certificate for quality assurance in production, installation and servicing.
2000- ISO-14001 Certificate pertaining to environmental management system.
2003- The entire carried forward loss of Rs. 98 crores wiped out and in May BIFR, declared
the company to be out of its purview. The company is making profit continuously; it is the
only state public sector unit that has come out of BIFR.
2004- The ISO-9002 was upgraded to ISO-9001-2004, Quality systems.
2008- Company has introduced Hand wash liquids under the trade name of Herbal hand wash
and Rose hand wash liquids. Company has also introduced liquid Detergent under the trade
Page 43
name of Kleenol liquid with different variants for floor wash, Dish wash and Automobile
wash.
2009- Company has established In-House state of the Art manufacturing facilities for
manufacturing Mysore Sandal Talcum powder. Company has re-introduced the Talcum
powder variants with new outlook of containers.
2010- The ISO certification was upgraded to ISO 9001:2008. Company is on progressive
growth for the last 10 years by increasing its production and sales volumes. The company
turnover has increased from 100 crores during the year 2003 to 200 crores during the year
2010.
2011- The Research and Development Department of the company is in the process of
development of the MILLENIUM SOAP new products like super specialty body wash,
liquid wash, liquid soap, room fresheners, body spray perfume and pure sandalwood powder
in small pouches.
2012- Indias most expensive Mysore Sandal Millennium Soap was launched on January 25 th
worth Rs. 720 per soap.
2013- They reached highest turnover and profit (322 crore) and
Got National award for Excellence Manufacturing Cost in Medium organization category.
ACHIEVEMENTS
Government of Karnataka Department of Industries and Commerce. State Export

Promotion
Geographical Indication GI-2005.
ISO 9001-2000 in the year 1999.
ISO 14001-2004 in the year 2000.
Export award for the year 2006-2007 for the excellence in Exports market.
Page 44
2.9 Swot analysis
STRENGTHS AND WEAKNESS

STRENGTHS
Only soap in India that contains pure sandal and almond oil.
The factory is located in the heart of the city and has all infrastructure facilities. They
have quick movement of raw materials and finished products. Due to its proximity,
habitation movement of men and materials are easy.
The company has brand loyalty of consumers and has 90% of sandal soap market.
An ISO 9002 certified company has its own brand image.
An ISO 14001 company which commits to reserve the natural environment in the
production of its quality products to the satisfaction of its customers.
Diversified product range keeps the company stable.
Two sandalwood oil factories in Shivmoga and Mysore, which produce 75% of worlds
sandalwood oil.
WEAKNESS
Lack of understanding among the lower level employees.
Lack of updated technology
The large proportion of the target area is middle class and upper class people.
Low turnover resulting in low profits.
It has only 8% of the total detergent market share.
Page 45
OPPORTUNITIES AND THREATS
OPPORTUNITIES
Existence of vast market and huge demand.
Traditional benefits that sandal is good for skin.
Good export market can tap foreign market vigorously.
Good raw material sources to enhance production.
The toilet soaps and detergents market is an over expanding industry and a major
company like KS&DL with its manufacturing expertise can call the shots if it reaches
peak manufacturing capacity.
THREATS
Government interference is more.
As company depends on forests for its main raw materials it makes the company to find
chemical alternative to sandalwood.
Other sandal soaps in the market. Entry of new multinationals in soap business.
2.10Future prospects of soap industry

The soap prospect seems to be numerous considering the fact that per capital consumption in
India is below 0.3kgs over the years we have M\S HLL, Mof \S Tom co, M\S KS&DL
leading the industry in the field of soap manufacturers. The growth population income and
consumption expenditure increase in urbanization, spread of education, modernization are
soap of the reasons that has increased the demand for soaps.
Page 46
2.11 Financial statement analysis

ANNUAL REPORT OF KSDL
Operational performance
Production:Total Rs. 27497.65 lakhs as against Rs. 20983.97 lakhs
Actual production in metric tons

SI
Class of Goods
2012 13
No
01
Soaps
9786.112
02
Detergents
1673.749
03
Sandal wood oil
2.335
04
Agarbathies
440.102
05
Talcum Powder
127.544
2011 12
8241.265
1693.663
1.616
347.128
145.290
Page 47
Sales (Rs. In lakhs)
SI
Class of Goods
2012 2013
2011 2012
Quantity in Value
Quantity in Value
M tons
M tons
No
01
Soaps
9303.033
24902.91
8966.171
20058.05
02
Detergents
1882.725
762.42
1924.882
728.34
03
Sandal wood oil
0.059
106.91
0.040
72.85
04
Agarbathies
451.563
1229.72
331.933
900.72
05
Talcum Powder
167.336
724.81
142.505
648.47
06
Coconut oil
295.085
580.65
38.729
436.70
Sales:Gross = Rs. 32280.72 lakhs as against Rs. 26117.00

Net = Rs. 25571.99 lakhs as against Rs. 21216.91
Page 48
PROFIT & LOSS ACCOUNT FOR THE YEARENDED 31ST MARCH 2013
PARTICULARS
AMOUNT
Rs.
Rs.
INCOME
Sales
286,21,32,818
Less: Excise duty
30,49,33,560
Net sales
255,71,99,258
Other income
3,00,40,704
258,78,39,962
Increase/(-) Decrease in
7,05,68,752
stock
265,84,08,714
Page 49
EXPENDITURE
Materials Consumed
129,67,11,687
(include trading items)

Other Expenditure
95,60,25,534
Depreciation
73,41,146
226,00,78,367
Operating Profit /Loss
398330347
Less:
Interest
and
Finance Charges
PROFIT BEFORE TAX
Less: Provision
39,83,30,347
for
Taxation
(i) Current Tax
10,83,28,122
(ii) Fringe Benefit Tax
3,83,56,890
Deferred Tax Asset
3,42,25,591
Profit/(loss)after tax
21,74,19,7
44
Page 50
Page 51
Concepts of working capital

The term working capital can be used in to different ways they are
1. Gross working capital
The gross working capital refers to investment in all the current asset taken together. The total
of investment in all current assets is known as gross working capital
2. Net working capital
The term net capital refers access of total current assets over total current liabilities. It may be
noted that the current assets refers to this liabilities which are payable with in a period of one
year.
Types of working capital

from the point of view of time, the term working capital can be divided in to two categories
1 permanent working capital
2 temporary working capital
Permanent working capital

It is also refers to the hardcore working capital. It is the minimum level of investment in the
current asset that is carried by the business at all times to carries hour minimum level of its
activities
Temporary working capital
It refers to the part of total working capital which is required by a business over and about
permanent working capital. It is also called variable working capital. Since the volume of the
temporary working capital keeps on fluctuating from time to time according to the business
activity it may be financed from short term resources.
Page 52
Sources of working capital

1. Long term resources
2. Short term resources
Long term sources

1.
2.
3.
4.
5.
6.
7.
8.
Sale of share
Sale of debenture
Sale of idle fixed assets
Long term loans
Customers credit
Loans from directors
Security of employee
Factoring
Short term sources

Internal
1. Depreciation funds
2. Provision of taxation
3. Accrued expenses
External
1. Trade credit
2. Credit papers
3. Bank credit
4 .public deposit
General factors determining working capital requirement

The working capital needs of a firm are determined and influenced by various factors. A wide
variety of considerations may affect the quantum of working capital required and these
considerations may vary from time to time. The working capital needed at one point of may
not be good enough for some other situation. The determination of working capital
requirements is a continuous process an be undertaken on and must be undertaken on a
regular basis in the light of the changing situations. Following are some of the factors which
Page 53
1. Production policy
2. Nature of the business
3. Credit policy
4. Inventory policy
5. Abnormal factors
6. Market conditions
7. Conditions of supply
8. Business cycle
9. Growth and expansion
10. Level of taxes
11. Dividend policy
12. Price level changes
13. Operating efficiency
Production policy
The size of business scheduled i.e. the plan for production, has great influence on the level of
the inventories. In some cases raw materials
Page 54

KSDL 1

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A STUDY ON WORKING CAPITAL

1.1 Introduction about the Internship

1.2 Study of working capital

1.3Need for the study

BGS INSTITUTE OF TECHNOLOGY, BG NAGAR

A STUDY ON WORKING CAPITAL

1.4 Objectives of the study

To study the statement of changes in working capital

1.5 Scope of the study

1.6 Methodology adopted

information was restricted

BGS INSTITUTE OF TECHNOLOGY, BG NAGAR

A STUDY ON WORKING CAPITAL

could not be by them project

2.1 INDUSTRY PROFILE

BGS INSTITUTE OF TECHNOLOGY, BG NAGAR

A STUDY ON WORKING CAPITAL

-Nirma soaps limited

Mysore soap factory at Bangalore.

Godrej soap factory at Bombay.

Tata Oil Mills.

Lever Brothers Company.

THE INDIAN SOAP INDUSTRY SCENARIO

BGS INSTITUTE OF TECHNOLOGY, BG NAGAR

A STUDY ON WORKING CAPITAL

Hindustan Levers Limited.

Tata Oil Mills Limited.

Godrej Soaps Private Limited.

Increase in Income and consumption.

Growth in degree of personal hygiene.

Soap manufacture has two classifications namely,

BGS INSTITUTE OF TECHNOLOGY, BG NAGAR

A STUDY ON WORKING CAPITAL

A STUDY ON WORKING CAPITAL

BGS INSTITUTE OF TECHNOLOGY, BG NAGAR

A STUDY ON WORKING CAPITAL

2.4 VISION, MISSION AND OBJECTIVES

To serve the national economy.

To promote and uphold its image as a symbol of traditional products.

BGS INSTITUTE OF TECHNOLOGY, BG NAGAR

A STUDY ON WORKING CAPITAL

To maintain the brand loyalty of its custom

2.5 PRODUCT AND SERVICES PROFILE

Mysore Sandal Soap

Mysore Sandal Classic Soap

Mysore Sandal Gold Soap

Mysore Sandal Baby Soap

Mysore Special Sandal Soap

Mysore Rose Soap

Mysore Sandal Herbal Care Soap

Mysore Jasmine Soap

Mysore lavender Soap

Mysore Sandal bath tablet

Mysore Sandal Classic Bath Tablet

Mysore Jasmine Bath Tablet

Mysore Special Sandal Tablet

Mysore Sandal rose Tablet

Mysore Sandal Guest Tablet

Mysore Sandal Millennium

BGS INSTITUTE OF TECHNOLOGY, BG NAGAR

A STUDY ON WORKING CAPITAL

Mysore Detergent Powder