TRAINING REPORT

ON

FINANCIAL STATEMENT ANALYSIS

OF SUTLEJ TEXTILES AND
INDUSTRIES LTD. (UNIT- BIRLA
TEXTILE MILLS)
AT

SUTLEJ TEXTILES AND INDUSTRIES LTD.

(UNIT- BIRLA TEXTILE MILLS)

MASTER OF BUSINESS ADMINISTRATION

DEPARTMENT OF SCHOOL OF MANAGEMENT

BAHRA UNIVERSITY, WAKNAGHAT,
DISTT. SOLAN, (H.P)

Faculty Guide: Name: Ajay kumar

BU2017PGMB003
Dr. Vinod Negi
 TRAINING REPORT

ON

FINANCIAL STATEMENT ANALYSIS

OF SUTLEJ TEXTILES AND
INDUSTRIES LTD. (UNIT- BIRLA
TEXTILE MILLS)

By
Name: Ajay kumar
Enrollment No: BU2017PGMB003

SUTLEJ TEXTILES AND INDUSTRIES LTD.

(UNIT- BIRLA TEXTILE MILLS)

A report submitted in partial fulfilment of

the requirements of MBA Program of Bahra University

Distribution List:

Company Guide: Faculty Guide:

Mr. Lalit Vig Dr. Vinod Negi

2|Page
 AUTHORISATION

This is to certify that this is a bona fide project report submitted for MBA program of ICFAI
Business School, Hyderabad.

This report document titled ―Financial Statement Analysis of Sutlej Textiles And Industries
Ltd. (Unit- Birla Textile Mills) is a submission of work done by Arpit Birla.

This report has been formally submitted to Dr.vinod negi, Faculty, IBS Hyderabad.

This report has been verified and authenticated by:

Dr. vinod negi

3|Page
 ACKNOWLEDGEMENT

I would like to express my profound gratitude to all those who have been instrumental in the
preparation of my project report. To start with, I would like to thank Sutlej Textiles And
Industries Limited (Unit- Birla Textile Mills) for providing me the chance to undertake
this internship study and allowing me to explore the area of financial statement analysis
which will surely prove to be very beneficial to me in my future assignments, my studies
and my career ahead.

I wish to place on record, my deep sense of gratitude and sincere appreciation to my company
guide Mr. Lalit Vig, General Manager – Finance and Accounts of Birla Textile Mills who
played a pivotal role in the preparation of my project. I would also like to thank them for their
constant support, advice and encouragement, without which this report could never have been
in its present form.

I would like to mention the unconditional help put forth by the entire team at Birla Textile
Mills.

I would also like to extend my profound gratitude to my faculty guide Dr. Vinid Negi for his
valuable suggestions, comments, feedback and support throughout the internship.

Ajay kumar
Bu2017pgmb003

4|Page
 TABLE OF CONTENT
Particulars Page No.

Abstract 7
List of illustrations 9
1. Introduction 10
1.1About Sutlej Textiles and Industries Limited 10
1.2Products of Sutlej Textiles and Industries Limited 12
1.3Acquisition of Birla Textile Mills (BTM) 16
1.4Research Methodology 18
1.5Data Collection 19
Main Text
2. Project Overview 20
2.1Introduction of Financial Statement 20
2.2Meaning and Concepts of Financial Statement 21
2.3Methods or Devices of Financial Analysis 22
2.3.1 Comparative Statement 22
2.3.2 Trend Analysis 22
2.3.3 Common size Statement 23
2.3.4 Fund Flow Statement 23
2.3.5 Cash Flow Statement 23
2.3.6 Cost Volume Profit Analysis 23
2.3.7 Ratio Analysis 24
- Liquidity Ratio 24
- Turnover Ratio 25
- Capital Structure Ratio 26
- Profitability Ratio 27
3. Balance Sheet 29
4. Statement of Profit and Loss 30
5. Liquidity Ratio 31
5.1Current Ratio 31
5.2Quick Ratio 32
5.3Absolute Quick Ratio 33
5.4Net Working Capital 34
5.5Ways to improve Liquidity Ratio 35
6. Turnover Ratio 36
6.1Inventory Turnover Ratio 36
6.2Debtors Turnover Ratio 37
6.3Creditors Turnover Ratio 38
6.4Fixed Assets Turnover Ratio 39
6.5Total Assets Turnover Ratio 40
6.6Ways to improve Turnover Ratio 41
7. Capital Structure Ratio 42

5|Page
 7.1Debt Equity Ratio 42
7.2Proprietary Ratio 43
7.3Interest Coverage Ratio 44
7.4Ways to improve Capital Structure Ratio 45
8. Profitability Ratio 46
8.1Gross Profit Ratio 46
8.2Operating Profit Ratio 47
8.3Ways to improve Profitability Ratio 48
9. References 49
10. Appendix 50

6|Page
 ABSTRACT

Sutlej Textiles and Industries Ltd (STIL) is a division of the K.K. Birla Group. The company
was promoted by late Dr. Krishna Kumar Birla and represented the textile interest of K.K.
Birla Group. Shri Chandra Shekhar Nopany is the Executive Chairman of the Board of
Sutlej Textiles and Industries Ltd. It is one of the largest integrated textile manufacturing
companies and is having strong position in the Indian Textile sector in the manufacturing of
value added synthetic, Natural and Blended yarns, all types of spun yarns, processing of
fabrics and Home Textile Furnishing.

This company is India’s biggest producer exporter of value added synthetic and blended dyed
yarns. It is the leading producer and exporter of home décor. The company has its registered
office in Bhawanimandi (Rajasthan) and corporate office in Mumbai. It posses 4 units in
India and has market presence in over 60 countries internationally.

The title of the project is Financial Statement Analysis of Sutlej Textiles and Industries
Limited. The term of study was kept limited to make the title true. The purpose of the report
is to get an in-depth understanding of the financials of Analysis of Sutlej Textiles and
Industries Limited.

Finance is defined as a provision of money when it is required every enterprise needs finance
to start and carry out its operations. Finance is the life blood of an organization. So finance
should be managed effectively.

Financial Statements are prepared primarily for decision making. Financial Statement
Analysis refers to the process of determining financial strength and weakness of the firm by
properly establishing strategic relationship between the items of the Balance Sheet and the
Profit and loss A/c. There are various methods and techniques used in analysing financial
statements, such as comparative statement, Trend analysis, common size statement, Schedule
of change in working capital, Fund flow and cash flow analysis, cost volume profit analysis
and Ratio Analysis.

The objective of this project work is to focus on the financial statements of the company and
understanding the financial position of the company.

7|Page
The research designed adopted in the study is exploratory research. The sample size of study
is three years annual reports of Sutlej Textiles and Industries limited (Unit- Birla Textile
mills). The tools describe the financial position of the company. The overall performance of
working capital for a period of 3 years from 2016-2018 have been taken into consideration.

8|Page
 LIST OF ILLUSTRATIONS
Figure No. Particulars Page No.

1 Yarns 11
2. Yarn and Piece Dyed Fabric 11
3. Drapery Fabric 12
4. Ready made Curtains 12
5. Cushion Covers 13
6.. Throws 13
7. Upholstery Fabric 14
8. Bed Scarf 14
9. Current Ratio 31
10. Quick Ratio 32
11. Absolute Quick Ratio 33
12. Net Working Capital 34
13. Inventory Turnover Ratio 36
14. Debtors Turnover Ratio 37
15. Creditors Turnover Ratio 38
16. Fixed Assets Turnover Ratio 39
17. Total Assets Turnover Ratio 40
18. Debt Equity Ratio 42
19. Proprietary Ratio 43
20. Interest Coverage Ratio 44
21. Gross Profit Ratio 46
22. Operating Profit Ratio 47

9|Page
1. INTRODUCTION

1.1- ABOUT SUTLEJ TEXTILES AND INDUSTRIES LIMITED

Sutlej Textiles and Industries Ltd (STIL) is a division of the K.K. Birla Group. The
company was promoted by late Dr. Krishna Kumar Birla and represented the textile interest
of K.K. Birla Group. This group is one of the top 20 business house in India and is one of the
most respected business houses in the country and has contributed immensely to the growth
of modern India. Sutlej Textiles and Industries was incorporated in June 2005 out of a
corporate restructuring exercise of Sutlej Industries Ltd and DamanGanga Processors Ltd.
Shri Chandra Shekhar Nopany is the Execuitve Chairman of the board of Sutlej Textiles
and Industries Limited. He is an eminent industrialist having industrial experience in diverse
fields like sugar, tea, shipping, textiles, fertilizers and chemicals, etc. He has also been the
President of Indian Chamber of Commerce.

STIL has inherited the legacy of Sutlej Industries Limited, which was founded as Sutlej
Cotton Mills Limited in 1934, and subsequently changed to Sutlej Industries Limited in 1995.
The company has its registered office in Bhawanimandi (Rajasthan) and corporate office in
Mumbai. At Sutlej we leverage our rich multi decade sectoral experience and market
understanding to grow our value added yarns business in domestic and export markets, and
build a sustainable unique position for home furnishing business.

It is an ISO 9001:2008 certified Company, which is one of the largest integrated textile
manufacturing companies and is having strong position in the Indian Textile sector in the
manufacturing of value added synthetic, Natural and Blended yarns, all types of spun yarns,
processing of fabrics and Home Textile Furnishing.

Sutlej Textiles & Industries Ltd (STIL) is a leading producer of value-added yarns In India.
Since inception the Company has been committed to achieve high growth through
development of niche products to meet increasingly sophisticated demands of the Industry.
Today, it possesses the largest product portfolios of spun-dyed, cotton blended and cotton
melange dyed yarns. Sutlej is the largest producer of Melange yarn in India and also one of
the few exclusive spinners for specialty yarns such as Modal, Lyocell and Tencel in the
country.

10 | P a g e
The Company stepped into the home textiles business in 2006 to offer distinguished products
to the market by extending its understanding and expertise in textiles backed by strong design
and product development capabilities. it works with leading companies-both domestic &
International- to develop a range of exclusive textiles in tune with emerging design trends.

The Company has a strong global clientele with presence across major developed and
emerging economies in over 46 countries.

As a company with a strong customer focus. Sutlej deeply engages with customers to develop
products that work for them. It enjoys enduring partnerships with agents and dealers across
the world.

Innovation, continuous technology upgrade and capacity strengthening are key drivers of
growth for the Company.

The company has 4 units across India-

UNITS LOCATION PRODUCTS CURRENT

CAPACITY
Rajasthan Textile Bhawanimandi Synthetic and 90,432 spindles
Mills (Rajasthan) Blended Yarns. for Cotton
Blended & Man-
made Fibres and
35,280 is Cotton
Melange Yarns.
Chenab Textile Kathua, Jammu & Cotton Melange 106175 Spindles
Mills kashmir Yarns, Cotton for Cotton
Blends Dyed Melange Yarns,
Yarn. Man-made 97129 Spindles for
Fiber Yarns. man-made Fiber
Yarns.
Birla Textile Baddi, Himachal Cotton and Cotton 83,376 spindles
Mills Pradesh Blended Yarns.
Synthetic and
Blended Yarns.
Damanganga Daheli, Gujarat Home Textiles 9.6 million meter
Home Textiles (Curtains, per annum
Upholstery, Made
ups)

11 | P a g e
1.2- PRODUCTS OF SUTLEJ TEXTILES AND INDUSTRIES LTD.

1. Yarns

Figure-1:- Yarns

2. Yarn and Piece Dyed Fabric

Figure-2:- Yarn and Piece Dyed Fabric

12 | P a g e
3. Drapery Fabrics

Figure-3:- Drapery Fabrics

4. Ready Made Curtains

Figure-4:- Ready made Curtains

13 | P a g e
5. Cushion Covers

Figure-5:- Cushion Covers

6. Throws

Figure-6:- Throws

14 | P a g e
7. Upholstery Fabrics

Figure-7:- Upholstery Fabric

8. Bed Scarf

Figure-8:- Bed Scarf

15 | P a g e
1.3- ACQUISITION OF BIRLA TEXTILE MILLS

The Company belongs to the K.K.Birla Group, one of the top 20 business house in INDIA.
Birla Textile Mills (BTM) initially started in the year 2000 and was the textile division of
Chambal Fertilizers and Chemicals Limited. The company is well equipped with most
modern state of art textile machineries and sophisticated quality control equipment. Today it
is well established and known for its international quality of products. Mill’s Strength lies in
its trained and dedicated workforce and continuous upgrading of human resources skills. The
unit provides employment to around 3000 labourers and comprises of 300 administrative staff
members. The plant of Birla Textile Mills in Himachal Pradesh has a total installed capacity
of 40,376 spindles, while another 43,000 spindles were added in 2006, extending the total to
83,376. The company’s yearly production of yarn is 20,000 MT and of which 40 % of the
production is being exported to the global markets.

In March,2015 K.K. Birla Group flagship company Sutlej Textile and Industries Limited got
approval from its Board of Directors to acquire another group company, Birla Textile Mills,
which was a unit of Chambal Fertilisers and Chemicals Limited located at Baddi in Himachal
Pradesh, on the basis of a slump sale.

Slump sale is the transfer or sale of one or more undertakings for a lump sum where no
values are assigned to individual assets and liabilities.

The transaction for acquisition of Birla Textile Mills (BTM) as a going concern on slump sale
basis has been successfully concluded on September 30, 2015. The consideration for
purchase of Birla Textile Mills from Chambal Fertilizers and Chemicals Limited works out to
be Rs 232.63 crore (including net current assets).

Post-acquisition, the spinning capacity of the company enhanced and increased to 377,688
spindles. The larger volumes helped the company to effectively amortise its fixed costs. The
result was that the Company reported an increase in profits, validating its acquisition and
expansion priorities. The company also got benefited through adding new customers in the
domestic and export markets.

16 | P a g e
Product Range of Birla Textile Mills

 Polyester / Viscose Blends (Only Dyed)

Knitting & Weaving count Ne 10s to 30s Single & Multifold (up to 8-Ply)

 100% Viscose (Raw White &Dyed)

Knitting & Weaving count Ne 12s to 30s Single & Multifold (upto 8-Ply)

 100% Cotton combed & carded yarns (Only Raw White)

s s s
Knitting & Weaving count Ne 20 , 24 & 30 Single & Double

 Viscose / Cotton Blends (Only Raw White)

Knitting & Weaving count Ne 24s & 30s Single & Double

 Polyester / Acrylic Blends (Only Dyed)

Knitting & Weaving count Ne 10s to 30s Single & Multifold (upto 8-Ply)

 100% Acrylic (Only Dyed)

s s
Knitting & Weaving count Ne 10 to 30 Single & Multifold (upto 8-Ply)

17 | P a g e
1.4- RESEARCH METHODOLOGY

The research involved extensive and intensive studies of Sutlej Textiles and Industries
Limited. In this project report a sincere effort has been made to study the financial statements
analysis of the company. During this study, I study the financial position and performance of
the company. At last, I have given interpretation and conclusion of the study.

The research designed adopted in the study is exploratory research. The sample size of study
is three years annual reports of Sutlej Textiles and Industries Limited. The tools describe the
financial position of the company. The overall performance of working capital for a period
of 3 years from 2016-2018 have been taken into consideration.

The major source of data for this project was collected through annual reports, profit and loss
account and balance sheet of 3 year period from 2016-2018 and some more information
collected from the internet and other text sources.

18 | P a g e
1.5- DATA COLLECTION

The whole of my study is based on secondary data of Sutlej Textiles and Industries Limited
and Birla Textile Mills. I have not taken any primary data for my study because primary data
would not have been helpful to my study. During the tenure of my study I have taken help of
the following secondary data.

 Annual report of Sutlej Textiles and Industries Limited.


 Annual audit report of Sutlej Textiles and Industries Limited and Birla Textile Mills. 

 Balance sheet of Birla Textile Mills.

 Profit and loss account of Birla Textile Mills.


19 | P a g e
2. PROJECT OVERVIEW

 Introduction of Financial Statement.



 Meaning and Concept of Financial Analysis.



 Methods and Devices of Financial Analysis.



 Limitation of Financial Analysis.



 Overview of Ratio Analysis.





2.1- INTRODUCTION OF FINANCIAL STATEMENT

Finance is defined as the provision of money when it is required. Every enterprise needs
finance to start and carry out its operation. Finance is the lifeblood of an organization. So,
finance should be managed effectively.

Financial Statements are prepared primarily for decision making. Financial Statement
Analysis refers to the process of determining financial strength and weakness of the firm by
properly establishing strategic relationship between the items of the balance sheet and profit
and loss account. There are various methods and techniques used in analyzing financial
statements, such as comparative statements, trend analysis, common size statements,
schedule of changes in working capital, funds flow and cash flow analysis, cost volume profit
analysis and ratio analysis and other operative data. The analysis of financial statement is
used for decision making by various parties.

20 | P a g e
2.2- MEANING AND CONCEPT OF FINANCIAL ANALYSIS

The term 'financial analysis', also known as analysis and interpretation of financial
statements', refers to the process of determining financial strengths and weakness of the firm
by establishing strategic relationship between the items of the balance sheet, profit and loss
account and opposite data."Analyzing financial statements," according to Metcalf and Titard,
"is a process of evaluating the relationship between component parts of financial statements
to obtain a better understanding of a firm's position and performance". In the words of Myers,
"Financial statement analysis is largely a study of relationship among the various financial
factors in a business as disclosed by a single set-of statement, and a study of the trend of
these factors as shown in a series of statements."

The purpose of financial analysis is to diagnose the information contained in financial

statements so as to judge the profitability and financial soundness of the fern. Just like a
doctor examines his patient by recording his body temperature, blood pressure, etc. before
making his conclusion regarding the illness and before giving his treatment, a financial
analyst analysis the financial statements with various tools of analysis before commenting
upon the financial health or weaknesses of an enterprise. The analysis and interpretation of
financial statements is essential to bring out the mystery behind the figures in financial
statements. Financial statements analysis is an attempt to determine the significance and
meaning of the financial statement data so that forecast may be made of the future earnings,
ability to pay interest and debt maturities (both current and long-term) and profitability of a
sound dividend policy.

The term 'financial statement analysis' includes both 'analysis', and 'interpretation'. A
distinction should, therefore, be made between the two terms. While the term 'analysis' is
used to mean the simplification of financial data by methodical classification of the data
given in the financial statements, 'interpretation' means, 'explaining the meaning and
significance of the data so simplified however, both analysis and interpretation are interlinked
and complimentary to each other. An analysis is useless without interpretation and
interpretation without analysis is difficult or even impossible most of the authors have used
the term analysis only to cover the meaning both analysis and interpretation as the objective
of analysis is to study the relationship between various items of financial statements by

21 | P a g e
interpretation. We have also used the terms Financial statement Analysis or simply Financial
Analysis to cover the meaning of both analysis and interpretation.

2.3- METHODS OR DEVICES OF FINANCIAL ANALYSIS

A number of methods or devices are used to study the relationship between different
statements. The following methods of analysis are generally used:

1. Comparative Statement
2. Trend Analysis
3. Common Size Statement
4. Funds Flow Analysis
5. Cash Flow Analysis
6. Ratio Analysis
7. Cost-Volume-Profit Analysis

2.3.1- COMPARATIVE STATEMENT:

A comparative statement is a document that compares a particular financial statement with

prior period statements or with the same financial report generated by another company.
Analyst and business managers use the income statement, balance sheet and cash flow
statement for comparative purposes.

2.3.2- TREND ANALYSIS:

A trend analysis is an aspect of technical analysis that tries to predict the future movement of
a stock based on past data. Trend analysis is based on the idea that what has happened in the
past gives traders an idea of what will happen in the future.

22 | P a g e
2.3.3- COMMON SIZE STATEMENT:

Common size income statement is an income statement in which each account is expressed as
a percentage of the value of sales. This type of financial statement can be used to allow for
easy analysis between companies or between time periods of a company.

2.3.4- FUNDS FLOW ANALYSIS:

Fund flow is the net of all cash inflows and outflows in and out of various financial assets.
Fund flow is usually measured on a monthly or quarterly basis; the performance of an asset
or fund is not taken into account, only share redemptions, or outflows, and share purchases,
or inflows.

2.3.5- CASH FLOW ANALYSIS:

An examination of a company's cash inflows and outflows during a specific period. The
analysis begins with a starting balance and generates an ending balance after accounting for
all cash receipts and paid expenses during the period. The cash flow analysis is often used for
financial reporting purposes

2.3.6- COST-VOLUME-PROFIT ANALYSIS:

Cost-volume-profit (CVP) analysis is used to determine how changes in costs and volume
affect a company's operating income and net income. In performing this analysis, there are
several assumptions made, including: Sales price per unit is constant. Variable costs per unit
are constant. Total fixed costs are constant.

23 | P a g e
2.3.7- RATIO ANALYSIS:

Ratio analysis is used to evaluate various aspects of a company's operating and financial
performance such as its efficiency, liquidity, profitability and solvency. The trend of these
ratios over time is studied to check whether they are improving or deteriorating. Following
are the types of ratios and their formulas.

1. Liquidity Ratio.

Liquidity ratios measure a company's ability to pay debt obligations and its margin of safety
through the calculation of metrics including the current ratio, quick ratio and operating cash
flow ratio.

a. Current Ratio = Current Assets / Current Liabilities

The current ratio is a liquidity ratio that measures a company's ability to pay short-term and
long-term obligations. To gauge this ability, the current ratio considers the current total assets
of a company (both liquid and illiquid) relative to that company's current total liabilities.

b. Quick Ratio = (Current Assets – Inventories ) / Current Liabilities

The quick ratio is a measure of how well a company can meet its short-term financial
liabilities. Also known as the acid-test ratio, it can be calculated as follows: (Cash +
Marketable Securities + Accounts Receivable) / Current Liabilities

c. Absolute Quick Ratio / Cash Ratio = (Cash + Marketable Sec.)/

Current Liabilities

Absolute Liquid Assets include cash in hand and at bank and marketable securities or
temporary investments. The acceptable norm for this ratio is 50% or 0.5: 1 or 1: 2.

24 | P a g e
 d. Net Working Capital = Current Assets – Current Liabilities.

Net working capital is the aggregate amount of all current assets and current liabilities. It is
used to measure the short-term liquidity of a business, and can also be used to obtain a
general impression of the ability of company management to utilize assets in an efficient
manner.

2. Turnover Ratios

The turnover ratio is the percentage of a mutual fund or other investments holdings that have
been replaced in a given year, which varies by the type of mutual fund, its investment
objective and/or the portfolio manager's investing style.

a. Inventory Turnover Ratio = COGS / Average Inventory

The inventory turnover ratio is calculated by dividing the cost of goods sold for a period by
the average inventory for that period. Average inventory is used instead of ending inventory
because many companies' merchandise fluctuates greatly throughout the year.

b. Debtor Turnover Ratio = Net Credit Sales / Average Debtors.

The receivables turnover ratio is an activity ratio measuring how efficiently a firm uses its
assets. Receivables turnover ratio can be calculated by dividing the net value of credit sales
during a given period by the average accounts receivable during the same period.

c. Creditor Turnover Ratio = Net Credit Purchases / Average Creditors.

Accounts payable turnover ratio is calculated by taking the total purchases made from
suppliers, or cost of sales, and dividing it by the average accounts payable amount during the
same period.

25 | P a g e
 d. Fixed Assets Turnover Ratio = Net Sales / Fixed Assets.

Fixed-asset turnover is the ratio of sales (on the profit and loss account) to the value of fixed
assets (on the balance sheet). It indicates how well the business is using its fixed assets to
generate sales.

e. Total Assets Turnover Ratio = Net Sales / Total Assets.

Total-asset turnover is the ratio of sales (on the profit and loss account) to the value of total
assets (on the balance sheet). It indicates how well the business is using its Total assets to
generate sales.

3. Capital Structure Ratio.

A firm's capital structure is the composition or 'structure' of its liabilities. For example, a firm
that has $20 billion in equity and $80 billion in debt is said to be 20% equity-financed and
80% debt-financed. The firm's ratio of debt to total financing, 80% in this example is referred
to as the firm's leverage.

a. Debt- Equity Ratio = Long term Debt / Shareholders Equity

Debt/Equity Ratio is a debt ratio used to measure a company's financial leverage, calculated
by dividing a company's total liabilities by its stockholders' equity. The D/E ratio indicates
how much debt a company is using to finance its assets relative to the amount of value
represented in shareholders' equity.

26 | P a g e
 b. Proprietary Ratio = Net Worth / Total Assets.

The proprietary ratio (also known as the equity ratio) is the proportion of shareholders' equity
to total assets, and as such provides a rough estimate of the amount of capitalization currently
used to support a business.

c. Interest Coverage Ratio = EBIT / Fixed Interest

The interest coverage ratio is used to determine how easily a company can pay interest
expenses on outstanding debt. The ratio is calculated by dividing a company's earnings before
interest and taxes (EBIT) by the company's interest expenses for the same period.

4. Profitability Ratio.

Profitability ratios are a class of financial metrics that are used to assess a business's
ability to generate earnings compared to its expenses and other relevant costs incurred
during a specific period of time.

a. Gross Profit Margin = Gross Profit / Net Sales

Gross profit ratio (GP ratio) is a profitability ratio that shows the relationship between gross
profit and total net sales revenue. It is a popular tool to evaluate the operational performance
of the business. The ratio is computed by dividing the gross profit figure by net sales.

b. Net Profit Margin = PAT / Net Sales

The net profit percentage is the ratio of after-tax profits to net sales. It reveals the remaining
profit after all costs of production, administration, and financing have been deducted from
sales, and income taxes recognized.

27 | P a g e
 c. Operating Profit Ratio = Operating Profit / Net Sales.

The operating profit margin ratio indicates how much profit a company makes after paying
for variable costs of production such as wages, raw materials, etc. It is expressed as a
percentage of sales and shows the efficiency of a company controlling the costs and expenses
associated with business operations.

d. Return on Total Assets = (EBIT) (1-t) / Total Assets.

The return on total assets (ROTA) is a ratio that measures a company's earnings before
interest and taxes (EBIT) against its total net assets. The ratio is considered to be an indicator
of how effectively a company is using its assets to generate earnings before contractual
obligations must be paid.

e. Return on Equity = PAT / Net Worth.

Return on equity (ROE) is a measure of profitability that calculates how many dollars of
profit a company generates with each dollar of shareholders' equity.

f. Earnings per Share = PAT / No. of Shares.

Earnings per share (EPS) are the portion of a company's profit allocated to each outstanding
share of common stock. Earnings per share serve as an indicator of a company's profitability.

g. Dividend per Share = Dividend paid / No. of Shares

DPS is derived as (net income per share) x (pay-out ratio). The pay-out ratio is equal to
the amount of income paid in dividends divided by the total net income.

28 | P a g e
 3. BALANCE SHEET OF BIRLA TEXTILE MILLS

Particulars As at December 31, As at March 31, As at March 31,

2017 2017 2016
I. ASSETS
1. Non-current assets
Property, plant and equipment 1381876984 13917,67,480 12192,53,312
Capital work in progress 46215496 179,95,762 328,82,053
Intangible Assets 195474 3,04,507 2,46,716
Financial Assets 6920444 69,01,923 68,03,673
Other non-current assets 378339 20,23,217 84,82,020
1435586737 14189,92,889 12676,67,774
2. Current assets
Inventories 853057817 10403,52,164 9112,30,376
Financial Assets
a) Trade receivables 494302972 3999,12,171 2879,48,321
b) Cash and cash equivalents 2224424 34,58,004 16,34,859
c) Bank Balance 1000088 10,24,215 10,22,338
d) Others 1496406 21,75,698 21,53,221
Current tax assets (net) 3798844 43,72,010 32,22,829
Other current assets 185782618 1081,52,715 1226,29,850
1541663169 15594,46,977 13298,41,794
TOTAL 2977249906 29784,39,866 25975,09,568

II. EQUITY AND LIABILITIES

Equity
Head office balance 7618,00,067 5983,21,821 5903,75,734
761800067 5983,21,821 5903,75,734
Liabilities
1. Non-current liabilities
Financial liabilities
a) Borrowings 761956876 9071,72,366 10174,98,916
b) Other financial liabilities 5490000 54,90,000 54,90,000
Long term provisions 12592496 125,92,496 97,85,741
780039372 9252,54,862 10327,74,657
2. Current liabilities
Financial liabilities
a) Borrowings 898445379 9818,81,841 5462,96,766
b) Trade payables 189869429 1313,52,158 1336,23,025
c) Other financial liabilities 267677014 2495,85,327 2020,68,814
Other current liabilities 5543279 281,39,509 299,33,136
Short term provisions 73875366 639,04,348 624,37,436
1435410467 14548,63,183 9743,59,177
TOTAL 2977249906 29784,39,866 25975,09,568

Note:- The balance sheet has been taken till December 31 st, 2017 as the balance sheet till March
31st, 2018 will get its approval in the Board Meeting on May 11 th, 2018.

29 | P a g e
 4. STATEMENT OF PROFIT & LOSS OF BIRLA TEXTILE MILLS

As at
December 31, As at March 31, As at March 31,
Particulars 2017 2017 2016
Income
I. Revenue from operations 2982131433 35769,90,032 18847,20,160
Other income 52016396 648,82,273 446,29,245
Total Revenue 3034147829 36418,72,305 19293,49,405

II. Expenses
Cost of raw materials consumed 1733360943 21626,95,007 11380,66,376
Purchase of stock in trade - 340,29,625 363,76,857
Changes in inventories of finished
goods, stock-in-trade and finished
goods -799476 -1820,92,528 69,35,740
1732561467 20146,32,104 11813,78,973

Gross Profit 1301586362 16272,40,201 7479,70,432

Administrative & Personnel expenses 311237275 3581,36,334 1578,45,073

Other expenses 679111153 8798,46,790 3978,49,796

EBIDTA 311237934 3892,57,077 1922,75,563

Depreciation and amortization expense 84244622 1049,15,435 439,76,197

EBIT 226993312 2843,41,642 1482,99,366

Finance costs 110047081 1374,57,984 596,12,003

EBT 116946231 1468,83,658 886,87,363

Note:- The statement of Profit & Loss has been calculated till EBT because consolidated tax is paid
by Sutlej Textiles and Industries Limited for all the units.

30 | P a g e
5. LIQUIDITY RATIO:

5.1- CURRENT RATIO

CURRENT RATIO
1.600
1.365
1.400
1.200 1.074 1.072
1.000
0.800
0.600
0.400
0.200
-
As at Dec, 2017 As at March, 2017 As at March, 2016
CURRENT RATIO 1.074 1.072 1.365

Figure-9:- Current Ratio

Interpretation & Analysis

Current ratio is a measure of liquidity of a company at a certain date. It must be analyzed in

the context of the industry the company primarily relates to. The underlying trend of the ratio
must also be monitored over a period of time.
From the year 2016 to the year 2017, the Company’s Current Ratio shows a declining trend
from 1.365 to 1.072 and then is stable till December 31st, 2017.
Generally, companies would aim to maintain a current ratio of at least 1 to ensure that the
value of their current assets cover at least the amount of their short term obligations.
However, a current ratio of greater than 1 provides additional cushion against unforeseeable
contingencies that may arise in the short term.
Traditional manufacturing industries require significant working capital investment in
inventory, trade debtors, cash, etc, and therefore companies operating in such industries may
reasonably be expected to have current ratios of 2 or more.

Importance

Current ratio is the primary measure of a company's liquidity. Minimum levels of current
ratio are often defined in loan covenants to protect the interest of the lenders in the event of
deteriorating financial position of the borrowers. Financial regulations of various countries
also impose restrictions on financial institutions to lend credit facilities to potential borrowers
that have a current ratio which is lower than the defined limits.

31 | P a g e
5.2- QUICK RATIO

QUICK RATIO
0.60
0.48
0.50
0.43
0.40 0.36

0.30

0.20

0.10

-
As at Dec, 2017 As at March, 2017 As at March, 2016
Quick Ratio 0.48 0.36 0.43

Figure-10:- Quick Ratio

Interpretation & Analysis

Quick ratio is an indicator of solvency of an entity and must be analyzed over a period of
time and also in the context of the industry the company operates in.

Over the years, the Company’s Quick Ratio shows a fluctuating trend. Decreasing from 0.43
in the year 2016 to 0.36 in the year 2017 and again increasing to 0.48 in December, 2017.

A quick ratio that is greater than industry average may suggest that the company is investing
too many resources in the working capital of the business which may more profitably be used
elsewhere. If a company has too much spare cash, it may consider investing the surplus funds
in new ventures and in case company is out of investment options it may be prudent to return
the excess funds to shareholders in the form of increased dividend payments. Acid test ratio
which is lower than the industry average may suggest that the company is taking too much
risk by not maintaining an appropriate buffer of liquid resources. Alternatively, a company
may have a lower quick ratio due to better credit terms with suppliers than the competitors.

Importance

Quick ratio is a measure of a company's ability to settle its current liabilities on a very short
notice. Current ratio may provide a misleading indication of a company's liquidity position
when a considerable portion of its current assets is illiquid. Quick ratio is therefore a more
reliable measure of liquidity for manufacturing companies and construction firms that have
relatively high levels of inventory, work in progress and receivables.

32 | P a g e
5.3- ABSOLUTE QUICK RATIO

ABSOLUTE QUICK RATIO

0.0035
0.0031
0.0030 0.0027
0.0025 0.0022
0.0020
0.0015
0.0010
0.0005
-
As at Dec, 2017 As at March, 2017 As at March, 2016
Absolute Quick Ratio 0.0022 0.0031 0.0027

Figure-11:- Absolute Quick Ratio

Interpretation & Analysis

The cash ratio shows how well a company can pay off its current liabilities with only cash
and cash equivalents. This ratio shows cash and equivalents as a percentage of current
liabilities.

Over the years, the Company’s Absolute Quick Ratio shows a fluctuating trend. Increasing
from 0.0027 in the year 2016 to 0.0031 in the year 2017 and again decreasing to 0.0022 in
December, 2017.

A ratio of 1 means that the company has the same amount of cash and equivalents as it has
current debt. A ratio above 1 means that all the current liabilities can be paid with cash and
equivalents. A ratio below 1 means that the company needs more than just its cash reserves to
pay off its current debt.

Importance

The cash ratio is more useful when it is compared to industry averages and competitor
averages. A cash ratio lower than 1 does indicate a company is having financial difficulty. A
low cash ratio may be an indicator of a company's strategy to have low cash reserves.

33 | P a g e
5.4- NET WORKING CAPITAL

NET WORKING CAPITAL

400,000,000
355,482,617
350,000,000
300,000,000
250,000,000
200,000,000
150,000,000
106,252,702 104,583,794
100,000,000
50,000,000
-
As at Dec, 2017 As at March, 2017 As at March, 2016
Net Working Capital 106,252,702 104,583,794 355,482,617

Figure-12:- Net Working Capital

Interpretation & Analysis

A positive Net Working Capital is better than a negative one. A positive calculation shows
creditors and investors that the company is able to generate enough from operations to pay
for its current obligations with current assets. On the other hand, a negative net Working
Capital shows creditors and investors that the operations of the business aren’t producing
enough to support the business’ current debts. If this negative number continues over time,
the business might be required to sell some of its long-term, income producing assets to pay
for current obligations like AP and payroll.

Over the years, the Company’s Net working capital shows a fluctuating trend. Decreasing
from 355482617 in the year 2016 to 104583794 in the year 2017 and again slightly
increasing to 106252702 in December, 2017.

Importance

1. Strengthen the solvency

2. Enhance goodwill
3. Easy obtaining loan
4. Regular supply of raw material
5. Smooth business operation

34 | P a g e
5.5- WAYS TO IMPROVE LIQUIDIY RATIO

 Sweep Accounts.
 Minimizing Overhead Costs.
 Selling of unproductive Assets.
 Minimizing Owners draws.
 Review Profitability.

35 | P a g e
6. TURNOVER RATIO:

6.1- INVENTORY TURNOVER RATIO

INVENTORY TURNOVER RATIO

4.00 3.67

3.50 3.15
3.00
2.45
2.50
2.00
1.50
1.00
0.50
0.00
As at Dec, 2017 As at March, 2017 As at March, 2016
Inventory Turnover ratio 3.15 3.67 2.45

Figure-13:-Inventory Turnover Ratio

Interpretation & Analysis

Inventory turnover is a measure of how efficiently a company can control its merchandise, so
it is important to have a high turn. This shows the company does not overspend by buying too
much inventory and wastes resources by storing non-saleable inventory. It also shows that the
company can effectively sell the inventory it buys.
Inventory turns vary with industry. For instance, the apparel industry will have
higher turns than the exotic car industry.
Over the years, the Company’s Inventory Turnover ratio is in a fluctuating trend. Increasing
from 2.45 times in the year 2016 to 3.67 times in the year 2017 and again decreasing to 3.15
times in December, 2017.

Importance

Inventory turnover is important because a company often has a significant amount of money
tied up in its inventory. If the items in inventory do not get sold, the company's money will
not become available to pay its employees, suppliers, lenders, etc.

It is also possible that a company's inventory will become less in demand, perhaps become
obsolete, or even deteriorate. If that occurs some of the company's money will be lost.
Having slow-moving items in inventory also uses valuable space and makes the warehouse
less efficient.

36 | P a g e
6.2- DEBTORS TURNOVER RATIO

DEBTORS TURNOVER RATIO

9.000
7.80
8.000
7.000
5.88
6.000
5.002
5.000
4.000
3.000
2.000
1.000
0.000
As at Dec, 2017 As at March, 2017 As at March, 2016
Debtors turnover Ratio 5.002 7.80 5.88

Figure-14:- Debtors Turnover Ratio

Interpretation & Analysis

Since the receivables turnover ratio measures a business ability to efficiently collect its
receivables, it only makes sense that a higher ratio would be more favourable. Higher ratios
mean that companies are collecting their receivables more frequently throughout the year. For
instance, a ratio of 2 means that the company collected its average receivables twice during
the year. In other words, this company is collecting is money from customers every six
months.

Over the years, the Company’s Debtors Turnover ratio is in a fluctuating trend. Increasing
from 5.88 times in the year 2016 to 7.80 times in the year 2017 and again decreasing to 5.002
times in December, 2017.

Importance

While this ratio is useful for tracking a company’s accounts receivable turnover history over
time, it may also be used to compare the accounts receivable turnover of multiple companies.
If two companies are in the same industry and one has a much lower receivables turnover
ratio than the other, it may prove to be the safer investment.

37 | P a g e
6.3- CREDITORS TURNOVER RATIO

CREDITORS TURNOVER RATIO

18.00 16.58
16.00
14.00
12.00 10.79
10.00 8.85
8.00
6.00
4.00
2.00
-
As at Dec, 2017 As at March, 2017 As at March, 2016
Creditors Turnover Ratio 10.79 16.58 8.85

Figure-15:- Creditors Turnover Ratio

Interpretation & Analysis

Since the accounts payable turnover ratio indicates how quickly a company pays off its
vendors, it is used by supplies and creditors to help decide whether or not to grant credit to a
business. As with most liquidity ratios, a higher ratio is almost always more favourable than a
lower ratio.

A higher ratio shows suppliers and creditors that the company pays its bills frequently and
regularly. It also implies that new vendors will get paid back quickly. A high turnover ratio
can be used to negotiate favourable credit terms in the future.

Over the years, the Company’s Creditors Turnover ratio is in a fluctuating trend. Increasing
from 8.85 times in the year 2016 to 16.58 times in the year 2017 and again decreasing to
10.79 times in December, 2017.

Importance
Creditors’ turnover ratio is an indicator of the credit worthiness of the company. A high ratio
means quick payment to creditors for purchases made on credit and a low ratio may be a sign
of delayed payment.

A high credit turnover ratio is always desirable.

38 | P a g e
6.4- FIXED ASSETS TURNOVER RATIO

FIXED ASSET TURNOVER RATIO

3.00
2.57
2.50
2.16
2.00
1.55
1.50

1.00

0.50

-
As at Dec, 2017 As at March, 2017 As at March, 2016
Fixed Asset Turnover Ratio 2.16 2.57 1.55

Figure-16:- Fixed Assets Turnover Ratio

Interpretation & Analysis

A high turnover indicates that assets are being utilized efficiently and large amount of sales
are generated using a small amount of assets. It could also mean that the company has sold
off its equipment and started to outsource its operations. Outsourcing would maintain the
same amount of sales and decrease the investment in equipment at the same time. A low
turnover, on the other hand, indicates that the company isn’t using its assets to their fullest
extent.

Over the years, the Company’s Fixed Asset Turnover ratio is in a fluctuating trend. Increasing
from 1.55 times in the year 2016 to 2.57 times in the year 2017 and again decreasing to 2.16
times in December, 2017.

Importance

The purpose of any business is, of course, to generate profit, so there are a variety of metrics
that business owners and investors use to assess the efficiency of a company's business
model. While many popular metrics, such as the net profit margin, measure the degree to
which a business is profitable, efficiency metrics measure how well a company uses what it
already owns to generate profits. The fixed asset turnover ratio is one such metric.

39 | P a g e
6.5- TOTAL ASSETS TURNOVER RATIO

TOTAL ASSET TURNOVER RATIO

1.40
1.20
1.20
1.00
1.00
0.73
0.80
0.60
0.40
0.20
-
As at Dec, 2017 As at March, 2017 As at March, 2016
Total Asset Turnover Ratio 1.00 1.20 0.73

Figure-17:- Total Asset Turnover Ratio

Interpretation & Analysis

This ratio measures how efficiently a firm uses its assets to generate sales, so a higher ratio is
always more favourable. Higher turnover ratios mean the company is using its assets more
efficiently. Lower ratios mean that the company isn't using its assets efficiently and most
likely have management or production problems. For instance, a ratio of 1 means that the net
sales of a company equal the average total assets for the year. In other words, the company is
generating Re. 1 of sales for every rupee invested in assets.

Over the years, the Company’s Total Asset Turnover ratio is in a fluctuating trend. Increasing
from 0.73 times in the year 2016 to 1.2 times in the year 2017 and again decreasing to 1 times
in December, 2017.

Importance

A low asset turnover ratio suggests problems with excess production capacity, poor inventory
management. Increases in the asset turnover ratio over time may indicate a company is
"growing into" its capacity (while a decreasing ratio may indicate the opposite), but
remember that asset purchases made in anticipation of coming growth (or the sale of
unnecessary assets in anticipation of declining growth) can suddenly and somewhat
artificially change a company's asset turnover ratio.

40 | P a g e
6.6- WAYS TO IMPROVE TURNOVER RATIO

 Improve Sales.
 Better inventory price.
 Focus on top selling products.
 Reduce purchase quantity.

41 | P a g e
7. CAPITAL STRUCTURE RATIO:

7.1- DEBT EQUITY RATIO

DEBT EQUITY RATIO

2.00
1.72
1.80
1.52
1.60
1.40
1.20 1.00
1.00
0.80
0.60
0.40
0.20
0.00
As at Dec, 2017 As at March, 2017 As at March, 2016
Debt Equity Ratio 1.00 1.52 1.72

Figure 18:- Debt Equity Ratio

Interpretation & Analysis

Each industry has different debt to equity ratio benchmarks, as some industries tend to use
more debt financing than others. A debt ratio of .5 means that there are half as many liabilities
as there is equity. In other words, the assets of the company are funded 2-to-1 by investors to
creditors. This means that investors own 66.6 cents of every rupee of company assets while
creditors only own 33.3 cents on the rupee. A lower debt to equity ratio usually implies a
more financially stable business. Companies with a higher debt to equity ratio are considered
more risky to creditors and investors than companies with a lower ratio.

Over the years, the Company’s Creditors Turnover ratio is in a decreasing trend. Decreasing
from 1.72 times in the year 2016 to 1.52 times in the year 2017 to 1 times in December,
2017.

Importance

Debt-to-equity ratio measure of a company's ability to repay its obligations. When examining
the health of a company, it is critical to pay attention to the debt/equity ratio. If the ratio is
increasing, the company is being financed by creditors rather than from its own financial
sources which may be a dangerous trend. Lenders and investors usually prefer low debt-to-
equity ratios because their interests are better protected in the event of a business decline.

42 | P a g e
7.2- PROPRIETARY RATIO

PROPRIETARY RATIO
0.30
0.26
0.25 0.23
0.20
0.20

0.15

0.10

0.05

0.00
As at Dec, 2017 As at March, 2017 As at March, 2016
Proprietary Ratio 0.26 0.20 0.23

Figure-19:- Proprietary Ratio

Interpretation & Analysis

The proprietary ratio shows the contribution of stockholders’ in total capital of the company.
A high proprietary ratio, therefore, indicates a strong financial position of the company and
greater security for creditors. A low ratio indicates that the company is already heavily
depending on debts for its operations. A large portion of debts in the total capital may reduce
creditor’s interest, increase interest expenses and also the risk of bankruptcy.
Over the years, the Company’s Proprietary Ratio is in a fluctuating trend. Decreasing from
0.23 times in the year 2016 to 0.2 times in the year 2017 and again increasing to 0.26 times in
December, 2017

Importance

This ratio indicates the extent to which the assets of the company can be lost without
affecting the interest of the creditors of the company.

43 | P a g e
7.3- INTEREST COVERAGE RATIO

INTEREST COVERAGE RATIO

3.00
2.49
2.50
2.06 2.07
2.00

1.50

1.00

0.50

0.00
As at Dec, 2017 As at March, 2017 As at March, 2016
Interest Coverage Ratio 2.06 2.07 2.49

Figure-20:- Interest Coverage Ratio

Interpretation & Analysis

Analyzing a coverage ratio can be tricky because it depends largely on how much risky the
creditor or investor is willing to take. Depending on the desired risk limits, a bank might be
more comfortable with a number than another. If the computation is less than 1, it means the
company isn’t making enough money to pay its interest payments. A company with a
calculation less than 1 can’t even pay the interest on its debt. This type of company is beyond
risky and probably would never get bank financing. If the coverage measurement is above 1,
it means that the company is making more than enough money to pay its interest obligations
with some extra earnings left over to make the principle payments.

Over the years, the Company’s Interest Coverage ratio is in a decreasing trend. Decreasing
from 2.49 times in the year 2016 to 2.07 times in the year 2017 to 2.06 times in December,
2017.

Importance

The choice of ratio, or combination of ratios, to use when analyzing a company often comes
down to the personal biases of the investor or analyst. Yet one would be hard-pressed to find
reason to skip the interest-coverage ratio, which is arguably the "neatest" assessment of a
company's short-term financial health. Any company that finds itself in jeopardy of defaulting
on its interest payments is likely to encounter an escalating set of financial problems that are
sure to affect the holdings of both shareholders and lenders.

44 | P a g e
7.4- WAYS TO IMPROVE CAPITAL STRUCTURE RATIO

 Increasing sales profitability.

 Better management of inventory.
 Restructuring debt

45 | P a g e
8. PROFITABILITY RATIO:

8.1- GROSS PROFIT RATIO

GROSS PROFIT RATIO

45.49%
46.00%
45.00%
43.65%
44.00%
43.00%
42.00%
41.00%
39.69%
40.00%
39.00%
38.00%
37.00%
36.00%
As at Dec, 2017 As at March, 2017 As at March, 2016
Gross Profit Ratio 43.65% 45.49% 39.69%

Figure-21:- Gross Profit Ratio

Interpretation & Analysis

The gross profit margin ratio is an indicator of a company’s financial health. It tells investors
how much gross profit every rupee of revenue a company is earning. Compared with industry
average, a lower margin could indicate a company is under-pricing. A higher gross profit
margin indicates that a company can make a reasonable profit on sales, as long as it keeps
overhead costs in control. Investors tend to pay more for a company with higher gross profit.

Over the years, the Company’s Gross Profit ratio is in a fluctuating trend. Increasing from
39.69% in the year 2016 to 45.49% in the year 2017 and again decreasing to 43.65% in
December, 2017.

Importance

Gross profit margin is generally important because it is the starting point toward achieving
healthy bottom line net profit. When you have a high gross profit margin, you are a in better
position to have a strong operating profit margin and strong net income. For a newer
business, the higher your gross profit margin, the faster you reach the break-even point and
begin earning profits from basic business activities.

46 | P a g e
8.2- OPERATING PROFIT RATIO

OPERATING PROFIT RATIO

8.00% 7.95%
7.87%
7.90%

7.80%

7.70%
7.61%
7.60%

7.50%

7.40%
As at Dec, 2017 As at March, 2017 As at March, 2016
Operating Profit Ratio 7.61% 7.95% 7.87%

Figure-22:- Operating Profit Ratio

Interpretation & Analysis

The operating profit margin ratio is a key indicator for investors and creditors to see how
businesses are supporting their operations. If companies can make enough money from their
operations to support the business, the company is usually considered more stable. A higher
operating margin is more favourable compared with a lower ratio because this shows that the
company is making enough money from its ongoing operations to pay for its variable costs as
well as its fixed costs.

For instance, a company with an operating margin ratio of 20 percent means that for every
dollar of income, only 20 cents remains after the operating expenses have been paid. This
also means that only 20 cents is left over to cover the non-operating expenses.

Over the years, the Company’s Operating Profit ratio is almost stable. Increasing from 7.87%
in the year 2016 to 7.95% in the year 2017 and again decreasing to 7.61% in December,
2017.

Importance

Operating margin can help an investor take an even closer look at a company, as it can be
used to analyze a particular project within a company, not only the company itself. Projects
can vary widely in size, but operating margin may still be used to investigate a particular
project or compare multiple projects within a company

47 | P a g e
8.3- WAYS TO IMPROVE PROFITABILITY RATIO

 Remove unprofitable products and services.

 Find new customers.
 Reduce overall direct costs.
 Reduce overhead costs.
 Reduce inventory level.

48 | P a g e
9. REFERENCES:

1. http://sutlejtextiles.com/
2. http://www.birlatextile.com/
3. https://economictimes.indiatimes.com/industry/cons-products/garments-/-
textiles/sutlej-textiles-gets-board-nod-to-acquire-birla-textile-
mills/articleshow/46580714.cms
4. www.myaccountingcourse.com
5. Annual Reports of Sutlej Textiles & Industries Limited.

49 | P a g e
10. APPENDIX:

 Basic SAP Training.

 Verification of accounts of creditors.
 Bills Scrutiny.
 Medical Reimbursement Expenses (documentation, verification and data entry).
 Leave Travel Allowance (documentation, verification and data entry).
 Preparation of e-way bill.
 Preparation of Export Invoice.
 Preparation of Examination report & Declaration pertains to Duty Drawback.
 Preparation of Tax Invoice in SAP.
 Preparation of Shipping Bill.
 Updating the information of export with the ID Tech.
 Debtors Ageing Period Analysis.
 Interest Debit Note in SAP.
 Display of Vendor Account in SAP.
 Preparation of CMA Report.

50 | P a g e