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A SUMMER INTERNSHIP REPORT
On
FINANCEAt
Birla Cement Satna
Submitted by
ANARUDHA PRASAD DWIVEDI
MBA (FT) semester- III
Batch 2012-14
PIONEER INSTUTE OF PROFESSIONAL STUDIES
INDORE (M.P.)
2013
1
DECLARATION FORM
This is to verify that Mr. Anarudha Prasad Dwivedi of Pioneer Institute of Professional Studies, Indore has undergone training from Birla Cement, Satna for a period of 30 days (15 june to 15 july 2013) in the field of Finance.
During the training the student has abided by the rules and regulation of our organization and his code of conduct was satisfactory.
Signature of Reporting Officer
Details of Reporting Officer :
Name of the Person :- C.A. Sumit Agrawal
Designation :- Dy. Manager (Accounts)
Email id :- [email protected]
Contact no. (Desk.) :- (07672) - 412000
Mobile No. :- 09827241295
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INDEXS.N. TOPICS COVERERD
1. OVERVIEW
2. HISTORY OF ORGANIZATION
3. PROMOTERS & MANAGEMENT
4. PLANTS & PRODUCT
5. VISION
6. MISSION
7. QUALITY POLICY
8. ORGANIZATION CHART
9. DEPARTMENT DETAIL
10. MAJOR ACTIVITIES
11. TYPE OF PROJECT
12.INTERNAL; DEPARTMENTAL COORDINATION
13. MAJOR FINDING
14. CONCLUSION
15. RECOMMENDATION
16. BIBLIOGRAPHY
17. ANNEXURE
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Overview of Birla Cement
The Cement Division of Birla Corporation Limited has seven plants, two each at Satna (M.P.) - Satna Cement Works & Birla Vikas Cement, Chanderia (Rajasthan) - Birla Cement Works & Chanderia Cement Works, Durgapur (W.B.) - Durgapur Cement Works & Durga Hitech Cement - and one at Raebareli (U.P.)-Raebareli Cement Works. They manufacture varieties of cement like Ordinary Portland Cement (OPC), 43 & 53 grades, Portland Pozzolana Cement (PPC), Fly Ash - based PPC, Low Alkali Portland Cement, Portland Slag Cement, Low Heat Cement and Sulphate Resistant Cement.
The cement is marketed under the brand names of Birla Cement SAMRAT, Birla Cement KHAJURAHO, Birla Cement CHETAK, Birla Cement and Birla Premium Cement, bringing the product under the common brand of Birla Cement while retaining the niche identity of SAMRAT for blended cement, i.e. PPC & PSC, for all the units, KHAJURAHO (for the OPC product of Satna) and CHETAK (for the OPC product of Chanderia).
The Division exports large quantities of cement to Nepal, under the brand names of Birla Cement Samrat, Birla Cement Khajuraho and Birla Cement. The special variety of Birla Cement SAMRAT, being produced by the company, is ideal for mass concrete, RCC/pre-stressed/precast structure (for reduced thermal crack), increased water tightness of concrete, increased resistance to sulphate soils and aggressive water and increased resistance to alkali aggregate reaction besides corrosion resistant properties.
All our cement plants are ISO 9001:2000 Certificated, covering the entire range of production and marketing.
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SATNA CEMENT WORKS
Counted amongst the larger plants of the Cement Division, Satna Cement Works and Birla Vikas Cement at Satna (MP) along with Raebareli Cement Works (UP) have an installed capacity of 2.36 million tonnes at present, which is projected to rise to 2.84 million tonnes after the present expansion/modification. Birla Cement Samrat and Birla Cement Khajuraho are already leading Brands and frontrunners of company’s activities. Riding on the glory of very high standards of quality, the company products are premierly priced in all the markets where it is available.
Overview : Cement Industry Satna (Madhya Pradesh), Chanderia (Rajasthan), Durgapur (West Bengal), Raebareli (Uttar Pradesh)
The Cement Division of Birla Corporation Limited has seven plants, two each at Satna (M.P.) - Satna Cement Works & Birla Vikas Cement, Chanderia (Rajasthan) - Birla Cement Works & Chanderia Cement Works, Durgapur (W.B.) - Durgapur Cement Works & Durga Hitech Cement - and one at Raebareli (U.P.)-Raebareli Cement Works. They manufacture varieties of cement like Ordinary Portland Cement (OPC), 43 & 53 grades, Portland Pozzolana Cement (PPC), Fly Ash - based PPC, Low Alkali Portland Cement, Portland Slag Cement, Low Heat Cement and Sulphate Resistant Cement. The cement is marketed under the brand names of Birla Cement SAMRAT, Birla Cement KHAJURAHO, Birla Cement CHETAK and Birla Premium
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Cement, bringing the product under the common brand of Birla Cement while retaining the niche identity of SAMRAT for blended cement, i.e. PPC & PSC, for all the units, KHAJURAHO (for the OPC product of Satna) and CHETAK (for the OPC product of Chanderia).
The Division exports large quantities of cement to Nepal, under the brand names of Birla Cement Samrat, Birla Cement Khajuraho and Birla Cement. The special variety of Birla Cement SAMRAT, being produced by the company, is ideal for mass concrete, RCC/pre-stressed/precast structure (for reduced thermal crack), increased water tightness of concrete, increased resistance to sulphate soils and aggressive water and increased resistance to alkali aggregate reaction besides corrosion resistant properties.
All our cement plants are ISO 9001:2000 Certificated, covering the entire range of production and marketing. SCW & BVC have received the IS/ISO 14001 certificate, an international recognition for "Implementation of Environmental Management System". (SCW has been awarded GREENTECH Safety Silver Award 2009 and GREENTECH Environment Excellence Award 2008 by GREENTECH Foundation, New Delhi. It has also received the First Prize for Maximum Reduction in KWH/ton of cement in M.P. from FLS Energy Award, Bhopal, in 2008. The Satna units received the Quality Circle Excellence Award from Quality Circle Forum of India, Durgapur Chapter; Quality Circle Excellence Award and Quality Circle Distinguish Award from Quality Circle Forum of India, Kanpur Chapter, both in 2008, and Quality Circle Forum of India, Baroda. SCW has received the National Award for Excellence in Water Management from CII, Hyderabad and First Prize for Lowest Thermal Energy Consumption K. Cal/kg clinker under the 10th FLS Energy Award 2007.
BVC has received the National Award for Excellence in Water Management from CII, Hyderabad, National Award for Energy Efficiency in Indian Cement Industry from NCCBM, New Delhi and Lowest Electrical Energy Consumption K. cal/kg clinker under the 10th FLS Energy Award in 2007. NCBM has given BVC the "Second Best Improvement in Electrical Energy Performance" Award for 2006-07. SCW received the Best Energy Conservation Implementation Gold Award from Rajiv Gandhi Memorial National Award, Hyderabad, in 2004.
BCW & CCW have received the IS/ISO : 14001 Certification for "Environmental Management System". BCW & CCW have bagged various awards from the NPC & NCCBM. CCW has won the "Lai Bahadur Shastri
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Memorial National" award for "Excellent Pollution Control Implementation" for 2001-02 by International Greenland Society. VEC, Chennai, chose the Chanderia units for s stained implementation of condition monitoring and continued Machine Health Improvement award during 2001-02. The "Workers Education Trophy" was awarded by the Central Board for Workers Education, Udaipur, Ministry of Labour, Government of India, for excellent contribution and implementation of workers training programmes during 1998-99 & again in 2001-02.
The laboratories of BCW & CCW have been accredited by NABL (National Accreditation Board of Testing and Calibration Laboratories) as per ISO/IEC 17025.
BCL has regularly been receiving CAPEXIL awards for cement exports since the last more than 15 years.
Power Plants : The Cement Division has two high-ash coal-based captive power plants at Satna (27 MW) and Chanderia (29.8 MW) each. The power plant at Chanderia received the FIVE 'S' Workplace Management System Certification from QCFI, Secunderabad.
Vindhyachal Steel FoundryVindhyachal Steel Foundry is a unit of BCL at Satna. It has access to the latest technology and infrastructure to manufacture castings required by cement plants as per national/international standards
Cement plant were set up in MP and Rajasthan and Grinding units in West
Bengal and UP.
Satna Cement Works - 1959
Birla Cement Works - 1967
Durgapur Cement Works - 1974
Birla Cement Works - 1982
Chittor Cement Works - 1986
SCW-Conversion Plant - 1989
Raebareli Unit - 1998
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HISTORY OF ORGANIZATION :-
Birla Corporation Limited a well known name in
the business world was established by late Shri Ghanshyam Das Birla in
the year 1919. He set up the first Indian owned jute mill near Calcutta and
named it Birla Jute Manufacturing Company Limited. The named of the
company was changed to Birla Jute I Industries Limited in 1983 and finally
to Birla Corporation Limited in 1998.
From G.D. Birla the unit passed on to his Nephew Late Shri M. P. Birla, who
with his entrepreneurial abilities and keen management mind expanded it
into an industrial empire with manifold diversification in various areas.
The company has seven divisions in six different states namely Rajasthan,
M.P. U.P. West Bengal, Maharashtra and Haryana.
The Company has following divisions -
1. Cement division
2. Jute division
3. Synthetics division
4. Carbides and Gases Division
5. Vinoleum division
6. Auto trim division
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Company Profile Birla Corporation Limited is the flagship Company of the M.P. Birla Group. Incorporated as Birla Jute Manufacturing Company Limited in 1919, it was Late Mr. Madhav Prasad Birla who gave shape to it. As Chairman of the Company, Mr. Madhav Prasad Birla transformed it from a manufacturer of jute goods to a leading multi-product corporation with widespread activities. Under the Chairmanship of Mrs. Priyamvada Birla, the Company crossed the Rs. 1300 - crore turnover mark and the name was changed to Birla Corporation Limited in 1998.
Mr. M P Birla Mrs. Priyamvada
Birla
After the demise of Mrs. Priyamvada Birla, the Company continued to consolidate in terms of profitability, competitiveness and growth under the leadership of Mr. Rajendra S. Lodha, late Chairman of the M.P. Birla Group. Under his leadership, the Company posted its best ever results in the years ended 31.3.2006, 31.3.2007 and 31.3.2008. The Company continued to record impressive growth in 2008-09 and 2009-10. Mr. H. V. Lodha is now Chairman of the Company. Birla Corporation Limited has products ranging from cement to jute goods, PVC floor covering, as well as auto trims (jute felt-based car interiors).
Mr. Rajendra S Lodha
(1942-2008)
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Management - Board Of Directors
Mr. Harsh V. Lodha Chairman
Mr. Harsh V Lodha, eminent Chartered Accountant, is on the Boards of several reputed companies. He has served as Chairman of Corporate Laws & Governance Committee and Co-Chairman of Young Leaders Forum of FICCI besides being Member of its Executive Committee. He has also served as Member of the Accounting Standards Board of the Institute of Chartered Accountants of India and Member of the Working group on Corporate Governance, set up by the Department of Company Affairs, Government of India. He had been Vice-President of the Indian Chamber of Commerce, Kolkata, and Chairman of its Economic Affairs Committee, Banking and Finance and Direct Tax Committees.
Mr. Pracheta MajumdarWhole-time Director designated as Chief Management Advisor
Mr Pracheta Majumdar, Whole-time Director designated as Chief Management Advisor, is former Managing Director of CEAT Tyres Limited. He has worked with Hindustan Lever Limited for 12 years and has extensive experience in the design and project management of chemicals, petrochemicals and fertilizer plants.
Mr. Vikram Swarup
Mr Vikram Swarup, Mechanical Engineer and Managing Director of Paharpur Cooling Towers Limited, is acknowledged as an authority on thermal designing of cooling towers in India. He has vast experience in
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marketing, engineering and other management functions. He is on the Boards of various companies also.
Mr. Anand Bordia
Mr Anand Bordia, M.A., held several senior positions in the Central Government. He was First Secretary, Trade High Commission of India, in London. He served the Secretariat of the World Customs Organization, Brussels, Belgium. He was also a Member of the Indian Revenue Service and Member (Finance) of the National Highways Authority of India. He has been consultant to the Asian Development Bank. He has conducted several technical assistance programmes on tariffs and trade matter, border control and tax modernisation in Asia, Africa and South American countries for the Harvard Institute for International Development, UNCTAD, and the World Customs Organization.
Mr. B B Tandon
Mr. B B Tandon, IAS, is former Election Commissioner of India and was member of the Delimitation Commission. He has served several Government offices in the capacity of Secretary and Additional Secretary in the Union Ministries of Personnel (under the direct charge of the Prime Minister), Mines, Company Affairs, Finance, Industry and Defence Production. Mr. Tandon headed the working group on comprehensive revision of the Companies Act, 1956, which recommended several changes/amendments in the said Act. He is also on the Boards of several reputed companies.
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Mr. D N Ghosh
Mr. D N Ghosh, former Chairman of the State Bank of India and the Management Development Institute, Gurgaon, was Founder-Chairman of the Indian Institute of Management, Lucknow. Presently, he is the Chairman of ICRA Limited, ICRA Management Consulting Services Limited and Sundaram BNP Paribas Asset Management Company Limited and is on the Board of the Housing Development Finance Corporation Limited. He has served as Chairman in several large companies, including Larsen & Toubro Limited and Phillips (India) Limited. Mr. Ghosh also served various Central and State Government departments in various capacities such as Financial Advisor, Additional Secretary and Secretary.
Mr Deepak Nayyar
Mr Deepak Nayyar, Professor of Economics at JNU at New Delhi, is also distinguished University Professor of Economics at the New School for Social Research, New York. He is Honorary Fellow of the Balliol College, Oxford. He has authored a number of books on a wide range of subjects. He was on the Boards of several large companies, including SBI, Exim Bank, Maruti Udyog and SAIL.
Mr. B R NaharManaging Director
Mr B R Nahar, Fellow Member of the Institute of Chartered Accountants of India, possesses rich professional experience of more than 33 years. He has served in diverse fields, at senior positions, in various large corporate houses. The prestigious Businessworld magazine has identified him as one of India’s “Most ‘Value’able CEOs” in its issue dated 29 November 2010.
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Plants :-
LOCATION OF PLANTS IN INDIA
State Town Units CapacityMillion.
TonsMadhya Pradesh
Satna Satna Cement Works / Birla Vikas Cement
2.20
Rajasthan Chanderia Birla Cement Works / Chanderia Cement Works / New Chanderia Cement Works
4.00
West Bengal
Durgapur Durgapur Cement Works / Durga Hitech Cement
2.30
Uttar Pradesh
Raebareli Raebareli Cement Works 0.80
Total 9.30
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Products The Product and Brand names are as follows :-
Units Products BIS Specifications Brand names
Birla Cement WorksChanderia Cement Works
Portland Pozzolana Cement (PPC)Ordinary Portland Cement (OPC) -43 Gr, 53 Gr
IS 1489 (Part - I)43 Gr - IS 811253 Gr - IS 12269
Birla Cement SamratBirla Cement Chetak
Satna Cement WorksBirla Vikas Cement
PPC OPC (43 Gr.)
IS 1489 (Part - I)IS 8112
Birla Cement SamratBirla Cement Khajuraho
Raebareli Cement Works
PPC IS 1489 (Part - I) Birla Cement Samrat
Durgapur Cement Works
Portland Slag Cement (PSC)
IS 455 Birla CementBirla Premium Cement
Durga Hitech Cement
PPC IS 1489 (Part - I) Birla Cement Samrat
Special Cements
Sulphate Resistant Cement IS 12330 Low-alkali Cement Railway Sleeper Grade Cement IRS T-40 (OPC 53S) Low Heat Cement IS 12600
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Company Vision and Mission
Vision :-
To be acknowledged as a leading player in the industry with the highest level of integrity.
Mission :-
•
State of the art cement plants• Transparent dealings with all stakeholders• Committed to the principles of good corporate governance
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QUALITY POLICY :-
Birla Corporation Limited, Chanderiya is committed to comply with the requirements of customers to their entire satisfaction & continually improve the effectiveness of Quality Management System by
1 Enhancing customer satisfaction by supplying consistent quality cement.
2 Regular up gradation of technology, optimum utilization of resources & upkeep of equipment for reducing costs.
3 Training & involvement of employees to develop quality culture in the unit.
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ORGANIZATION CHART :-
WHAT IS ORGANIZATIONAL STRUCTURE :-
• The manner in which an organization divides its labour into specific tasks and achieves coordination among these tasks.
• HORIZONTAL DIVISION OF LABOUR groups the basic tasks to be performed into jobs and then into departments so organizational goals can be achieved.
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BOARD OF DIRECTORS
CEO
PRODUCTION MANAGER
CHIEF ENGINEER MAINTENANCE MANAGER
WORK & METHODS STUDY
MANAGER
QUALITY CONTROL MANAGER
PURCHASE MANAGER
PERSONNEL MANAGER
FINANCIAL MANAGER
MARKETING MANAGER
SALES MANAGERMARKETING RESEARCH MANAGER
PRODUCT PLANNING MANAGER
ADVERTISING MANAGER
Chain of Command
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Departmentation :-
“It is the process of dividing the organization into manageable subunits. The subunits are often referred to as departments, divisions, or sections. By whatever name the units are called, the process is known as departmentation.”
The process through which an organization’s activities are grouped together and assigned to managers; the organization wide division of work.
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CEO
PRODUCTION FINANCE MARKETING
ADVERTISEMENT SALES MARKET RESEARCH
PERSONNEL
DEPARTMENT DETAIL :-
Overview of Finance Department
As I was working in finance department in Birla Corporation Ltd. , so its important to give a brief overview of what are the functions and workings of this department. Mainly in manufacturing industry all departments are closely integrated.
Functions and Responsibilities
Functions and responsibilities of the finance wing include the following:
1) Determine the financial resources required to meet the organization’s operating and capital expenditure program.
2) Forecast how much of fund requirement would be met by internal mobilization of funds and how much has to be borrowed from outside.
3) Establish and maintain the system of financial control governing the allocation and use of funds on daily basis.
4) Analysis of financial results of all the operations and making recommendation concerning future operations.
5) Carry out special studies with a view to reduce cost and improve efficiency and profitability.
6) Carry internal audits and also maintain financial records of the company.
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Cash Management Product
Necessity of CMP
Previously, the cement was sold through our depot network at various locations situated in MP, UP, Bihar, Jharkhand, Uttaranchal & West Bengal.
Against above sales, funds were collected in the form of Cheque/ Demand Draft and the same were presented at various branches of SBI at depot locations by our representatives.
Funds deposited at depot banks were remitted to our Cash Credit bank account with SBI, Satna.
Traditional Methods of Funds Transfer
Telegraphic Transfer Electronic Transfer
AGENCIES INVOLVED
Funds Remitting Branch Post Office (In case of TT) Funds Receiving Branch
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SHORTCOMINGS OF TRADITIONAL METHODS
Blockage of Funds at remitting branch/ in transit Requirement of opening of account at collection centre Comparatively higher cost MIS support not available for Internal Control & Funds Planning No value date credit is allowed in case of delay (In case of TT)
Introduction
Cash Management Product is the service provided by SBI for collection/payment keeping following targets:
Speedier movement of funds for reducing transit float to the minimum Competitive Cost MIS Support for Internal Control & Proper Fund Planning Interest Cost reduction on borrowings
STATE BANK OF INDIA provides cash management services to Corporate Clients under the brand name SBI FAST ( Funds Available in Shortest Time). SBI FAST eliminates the inherent delays of the traditional funds transfer mechanism and enhances liquidity to ensure optimum planning and utilization of funds.
23
Major Activities :-
As I was working in finance department in Birla Corporation Ltd. , so its important to give a brief overview of what are the functions and workings of this department. Mainly in manufacturing industry all departments are closely integrated.
DATE AMOUNT PLUS MINUS TOTAL INTEREST 01-Jun-
13 36590290.45 02-Jun-
13 25098016.45 03-Jun-
13 -3384254.01 10000.00 -3394254.01 -925.282942504-Jun-
13 -6178260.08 10000.00 -6168260.08 -1681.48459705-Jun-
13 9509478.91 06-Jun-
13 -6600580.15 121915.35 -6722495.5 -1832.57069107-Jun-
13 4268408.35 121915.35 4390323.7 08-Jun-
13 4224730.67 4224730.67 1151.67315509-Jun-
13 -2564432.33 -2564432.33 -699.07127910-Jun-
13 -16220702.63 12283.00 -16232985.63 -4425.15635711-Jun-
13 -2542375.64 12283.00 1461000.00 -3991092.64 -1087.98278812-Jun-
13 185401.03 1461000.00 215000.00 1431401.03 13-Jun-
13 -5210182.85 215000.00 9832.00 -5005014.85 -1364.3807614-Jun-
13 11813432.69 9832.00 11823264.69 15-Jun-
13 -26848307.72 -26848307.72 -7318.92224116-Jun-
13 -30070616.33 -30,070,616.33 -8197.33239717-Jun-
13 23094693.7 1165000 21929693.7 18-Jun-
13 -5390902.72 1165000 218000.00 -4443902.72 -1211.42005719-Jun-
13 8214773.44 218000.00 1063000 7369773.44 20-Jun-
13 -7947937.56 1063000 53,000.00 -6,937,937.56 -1891.300787
24
21-Jun-13 -6252270.1 53,000.00 258000 -6,457,270.10 -1760.26952
22-Jun-13 14442952.63 258000 14700952.63
23-Jun-13 7561612.63
24-Jun-13 -2706385.18 130000 -2836385.18 -773.206371
25-Jun-13 2006591.71 130000 100000 2036591.71
26-Jun-13 3254270.76 100000 3354270.76
27-Jun-13 -1379565.9 -1379565.9 -376.073444
28-Jun-13 19291646.06 73,109.00 19,218,537.06
29-Jun-13 4602971.91 73,109.00 100000 4,576,080.91
30-Jun-13 -4238609.09 -4238609.09 -1155.456451
-33548.237
5
What is cement and how is it made? Cement is a soft powdery-type substance. It is made from a mixture of
element found in nature material such a limestone, clay and/or shale when
cement mix with water it can bind sand and gravel into a hard solid mass called
concrete.
Four essential elements are needed to make cement they are silicon,
aluminum, iron, and calcium (which is the main ingredient) can be obtained
from limestone, sand/clay.
For making cement mainly four Raw materials are required:-
1) Limestone
2) Gypsum
3) Laterite / Blue Dust
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4) Fly Ash
Limestone is obtained by blasting in mines. In mines there are several layers of
soil, hard rocks, etc. After 5-6 layers company gets limestone in the form of big
rocks. By blasting these big rocks of limestone be get limestone in smaller form
which are easier to transport. Now through conveyer belt these limestone are
moved to plant. These limestone breaks up into smallest part by grinder. Now
this grinded lime stone transfer to kiln. The temperature of kiln approximately
1400C. in kiln limestone and other raw materials like Gypsum, Laterite and Fly
Ash were mixed with each other. The high temperature of kiln melts all the raw
materials. After kiln all these materials take a round shape which is generally
known as “Clinker”. Clinker is a semi-finished product of company. After
grinding these clinkers we get final cement which is used for domestic as well
as construction purpose.
Cement product is very fine one kilo (2.2ibs) contains over 300 billion gram we
haven’t actually counted them to see if that is completely accurate the powder
will pass through a slave capable of holding water.
Applications:- Suitable for all types of construction like building, roads, bridges, culverts
and cement base products.
Mass concrete work like dam, machine foundation work.
Concrete works in environment involving chemicals in soil and water.
Sewage and effluent treatment plant.
All kinds of marine works, like jetty etc.
Types of Cement:-Prism cement ltd manufactured two types of cement-
1. PPC
2. OPC
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PPC (Portland Pozzolona Cement) with the brand name ‘Champion’ is
general-purpose cement popular for all applications during house construction
by individuals. It is finely ground blend of high quality clinker and carefully
selected high quality Pozzolona material(Fly Ash) with high fineness an
optimum range of chemical composition.
OPC (Ordinary Portland Cement) is made in three grades i.e. 33 Grade, 43
Grade, and 53 Grade cement. Prism Cement’s OPC is in demand for specialized
cement concrete applications like high-rise buildings, bridges, manufacturing
AC sheets, pipes, poles etc.
43 Grade:-
Features:- Achieve more than the specified strength as per the relevant IS code
through proper adjustment in the chemical composition.
High quality limestone deposit result in:
- Higher strength of cement.
- Moderate sulphate resisting properties.
- Lower level of chloride concentration
Efficient quality control and high level of process parameter results in
reduced free lime, low insoluble residue and loss on ignition.
Applications:-
Optimally higher strength of cement makes it suitable for:
All General and semi specialized construction works like plain and
reinforced cement concrete works, brick and stone masonry, plastering
and flooring.
27
Manufacturing of concrete pipes, blocks, tiles and poles.
Suitable for applications like pre-cast, pre stressed and slipform
construction work.
Also suitable for all types of specialized concrete repair works like
gunniting etc.
28
Grade 53:-
Features:-
Higher strength than 43 Grade is achieved through further improvement
in the raw meal chemical composition and also grinding finer than 43
Grade cement.
High quality limestone deposit result in
- Higher strength of cement.
- Moderate sulphate resisting properties.
- Lower level of chloride concentration.
Efficient quality control and high level of process parameter results in
reduced free lime, low insoluble residue and loss on ignition.
Optimally higher fineness results in early strength improvement.
Closed circuit cement grinding system using high efficiency separator
controls the particle size distribution resulting proper hydration character.
Applications:-
High strength of cement makes it suitable for:
Making high grade concrete with proper mix design.
Early form works removal due to high early strength development result
in quicker construction.
Optimally higher fineness gives better cohesiveness, improved
workability resulting denser concrete and superior surface finish.
Economical usage of cement due to high strength through proper concrete
mix design.
All type of plain and R.C.C., semi and specialized construction work, like
bridges, culverts, slipform work, pre-stressed pipe / poles etc.
Also suitable for all types of specialized concrete repair work like
gunniting etc.
29
30
TYPE OF PROJECT :-
WORKING CAPITAL - Meaning of Working Capital
Capital required for a business can be classified under two main categories
via,
1) Fixed Capital
2) Working Capital
Every business needs funds for two purposes for its establishment and to
carry out its day- to-day operations. Long terms funds are required to create
production facilities through purchase of fixed assets such as p&m, land,
building, furniture, etc. Investments in these assets represent that part of firm’s
capital which is blocked on permanent or fixed basis and is called fixed capital.
Funds are also needed for short-term purposes for the purchase of raw material,
payment of wages and other day – to- day expenses etc.
These funds are known as working capital. In simple words, working
capital refers to that part of the firm’s capital which is required for financing
short- term or current assets such as cash, marketable securities, debtors &
inventories. Funds, thus, invested in current assts keep revolving fast and are
being constantly converted in to cash and this cash flows out again in exchange
for other current assets. Hence, it is also known as revolving or circulating
capital or short term capital.
“Working capital means the part of the total assets of the business that change from one form to another form in the ordinary course of business operations.”
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Concept of working capital:-
The word working capital is made of two words 1.Working and 2. Capital
The word working means day to day operation of the business, whereas the word capital means monetary value of all assets of the business.
Working capital : -
Working capital may be regarded as the life blood of business. Working capital is of major importance to internal and external analysis because of its close relationship with the current day-to-day operations of a business. Every business needs funds for two purposes.
* Long term funds are required to create production facilities through purchase of fixed assets such as plants, machineries, lands, buildings & etc
* Short term funds are required for the purchase of raw materials, payment of wages, and other day-to-day expenses.
. It is other wise known as revolving or circulating capital
It is nothing but the difference between current assets and current liabilities. i.e.
Working Capital = Current Asset – Current Liability.
Businesses use capital for construction, renovation, furniture, software, equipment, or machinery. It is also commonly used to purchase inventory, or to make payroll. Capital is also used often by businesses to put a down payment down on a piece of commercial real estate. Working capital is essential for any business to succeed. It is becoming increasingly important to have access to more working capital when we need it.
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Concept of working capital
Gross Working Capital = Total of Current Asset Net Working Capital = Excess of Current Asset over Current
Liability
Current Assets Current Liabilities Cash in hand / at
bank Bills Receivable Sundry Debtors Short term loans Investors/ stock Temporary
investment Prepaid expenses Accrued incomes
Bills Payable Sundry Creditors Outstanding expenses Accrued expenses Bank Over draft
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Working capital in terms of five components:
1. Cash and equivalents: - This most liquid form of working capital requires constant supervision. A good cash budgeting and forecasting system provides answers to key questions such as: Is the cash level adequate to meet current expenses as they come due? What is the timing relationship between cash inflow and outflow? When will peak cash needs occur? When and how much bank borrowing will be needed to meet any cash shortfalls? When will repayment be expected and will the cash flow cover it?
2. Accounts receivable: - Many businesses extend credit to their customers. If you do, is the amount of accounts receivable reasonable relative to sales? How rapidly are receivables being collected? Which customers are slow to pay and what should be done about them?
3. Inventory: - Inventory is often as much as 50 percent of a firm's current assets, so naturally it requires continual scrutiny. Is the inventory level reasonable compared with sales and the nature of
your business? What's the rate of inventory turnover compared with other companies in your type of business?
4. Accounts payable:- Financing by suppliers is common in small business; it is one of the major sources of funds for entrepreneurs. Is the amount of money owed suppliers reasonable relative to what you purchase? What is your firm's payment policy doing to enhance or detract from your credit rating?
5. Accrued expenses and taxes payable: - These are obligations of your company at any given time and represent a future outflow of cash.
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Two different concepts of working capital are:-
Balance sheet or Traditional concept Operating cycle concept.
Balance sheet or Traditional concept:- It shows the position of the firm at certain point of time. It is calculated in the basis of balance sheet prepared at a specific date. In this method there are two type of working capital:-
Gross working capital Net working capital
Gross working capital:- It refers to the firm’s investment in current assets. The sum of the current assets is the working capital of the business. The sum of the current assets is a quantitative aspect of working capital. Which emphasizes more on quantity than its quality, but it fails to reveal the true financial position of the firm because every increase in current liabilities will decrease the gross working capital.
Net working capital:- It is the difference between current assets and current liabilities or the excess of total current assets over total current liabilities.
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RAW MATERIAL
WORK IN PROGRESS
FINISH GOODSSALES
DEBTORS & BILLS RECEIVABLES
CASH
OPERATING CYCLE
Working capital= current assets - current liabilities.
Net working capital: - It is also can defined as that part of a firm’s current assets which is financed with long term funds. It may be either positive or negative. When the current assets exceed the current liability, the working capital is positive and vice versa.
Operating cycle concept:- The duration or time required to complete the sequence of events right from purchase of raw material for cash to the realization of sales in cash is called the operating cycle or working capital cycle.
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Types of Working Capital:-
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TYPES OF WORKING CAPITAL
ON THE BASIS OF B/S CONCEPT
GROSS WORKING CAPITAL
NET WORKING CAPITAL
ON THE BASIS OF TIME
REGULAR WORKING CAPITAL
TEMPORARY WORKING CAPITAL
SEASONAL WORKING CAPITAL
SPECIFIC WORKING CAPITAL
SIGNIFICANCE OF WORKING CAPITAL:-
Factors requiring consideration while estimating working capital.
The average credit period expected to be allowed by suppliers. Total costs incurred on material, wages. The length of time for which raw material are to remain in stores
before they are issued for production. The length of the production cycle (or) work in process. The length of sales cycle during which finished goods are to be kept
waiting for sales. The average period of credit allowed to customers The amount of cash required to make adance payment
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SIGNIFICAN--CE OF
WORKING CAPITAL
PAYMENT TO
SUPPLIERS
DIVIDEND DISTRIBUTI-
ON
INCREASE DEBT
CAPACITY
INCREASE IN FIX
ASSETS
INCREASE EFFECIENC-
Y
EASY LOAN FROM BANKS
Statement showing change in working capital for BCL:-
( Rs.in lacs)
Particulars 11-12 10-11 Increase ( + ) Decrease (- )
Current Assets
Inventories 20044.82 14258.83 5785.99
Sund. Debtors 3171.25 2722.47 448.78
Cash & Bank 3135.65 3439.42 303.77
Loan & Advances 47311.27 30525.34 16785.93
Total ( A ) 73662.99 50946.06
Current Liabilities
C.L. 30109.32 24092.95 6016.37
Provisions 35306.92 19215.28 16091.64
Total ( B ) 65416.24 43308.23
( A-B ) 8246.75 7637.83 23020.70 22411.78
↑ in working capital
608.92 608.92
Total 8246.75 8246.83 23020.70 23020.70
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Statement showing change in working capital for BCL:
( Rs.in lacks)
Particulars 11-12 10-11 Increase ( + ) Decrease ( - )
Current Assets
Inventories 14258.83 10572.33 3686.5
Sund. Debtors 2722.47 2248.22 474.25
Cash & Bank 3439.42 5922.59 2483.17
Other C.A. ----------- 28.38 28.38
Loan & Adv. 30525.34 12442.01 18083.33
Total ( A ) 50946.06 31213.53
Current Liabilities
C.L. 24092.95 25753.21 1660.26
Provisions 19215.28 4489.21 14726.07
Total ( B ) 43308.23 302242.42
( A-B ) 7637.83 971.11 23904.34 17237.62
↑ in working capital
6666.72 6666.72
Total 7637.83 23904.34
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CALCULATION OF WORKING CAPITAL FOR BIRLA CORPORATION LIMITED
(Rs.in lacks)
YEAR 31.03.11 31.03.12
CURRENT ASSETS
INVENTORIES 10572.33 14258.83 20044.82
SUNDRY DEBTORS 2248.22 2722.47 3171.25
CASH AND BANK 5922.59 3439.42 3135.65
OTHER CURRENT ASSETS 28.38 --- ---
LOANS & ADVANCES 12442.01 30525.34 47311.27
-------------- -------------- ---------------
TOTAL CURRENT ASSESTS 31213.53 50946.06 73662.99
-------------- -------------- ---------------
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CURRENT LIABILITIES AND PROVISIONS
CURRENT LIABILITIES 25753.21 24092.95 30109.32
PROVISION 4489.21 19215.28 35306.92
-------------- -------------- --------------
TOTAL CURRENT LIABILITIES 30242.42 43308.23 65416.24
---------------- ---------------- ---------------
NET CURRENT ASSETS 971.11 7637.83 8246.75
2010 2011 20120
2000400060008000
10000 NET WORKING CAPITAL
YEAR
AM
OU
NT(
IN L
AC
KS)
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Internal; Departmental Coordination
• DIFFERENTIATION – Differences in goals, time spans and interpersonal styles between departments
• INTEGRATION – The process of attaining coordination across differentiated departments.
– PAPER WORK – Memos
– MEETINGS
– LIAISON ROLE – A person is assigned to help achieve coordination between his or her department and another department.
– TASK FORCES AND TEAMS – Groups set up to solve coordination problems across several departments.
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Departmental Coordination
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Major Findings :-
Statement Showing Difference from Previous Year
(amt. in lacks)
Particulars 10-11 11-12
Investments 24476.15
↑ by 140%
21392.64
↑ by 51%
Inventories 3686.5
↑ by 35%
5785.99
↑ by 40%
Sundry Debtors 474.25
↑ by 21%
448.78
↑ by 16%
Cash & Bank -2483.17
↓ by 42%
-303.77
↓ by 9%
Current Liabilities -1660.26
↓ by 6.44%
6016.37
↑ by 25%
General reserve 17500
↑ by 233%
10000
↑ by 40%
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1. BCL’s NPAT is increasing day by day from last three years and the growth is remarkable.
2. BCL has shown that it is very strong competitor in cement sector of India.
3. Cement can be said as true fruitful business for BCL from last many years.
4. Overall all ratios of the company are good and company need to work with more efficiency.
5. The additional capacity of cement production at Durgapur will create new milestones for the BCL.
6. Lack of advertisement can be said as weak point of the BCL.
7. BCL’s investment policies are very much reliable.
8. Position of the stock is increasing per year that is good sign to face the competition coming ahead.
9. Highest ever net profit of Rs. 393.57 crores
10. Highest ever dividend pay out of Rs. 36.04 crores
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CONCLUSION:-
The overall performance of Birla Corporation Limited is getting on a good track.The total turnover of the company has registered a growth of 11.27% where as the operating profits for the year were higher by 18.03% mainly on the accounts of increase in the volume or blended cement in the overall cement sales, higher realization and effective cost control measures taken by the company. The profit before tax was up by 19.37% at Rs. 551.18 crores at against Rs. 461.74 crores in the previous year. The cash earning of the company improved substantially to Rs. 501.39 crores as against Rs.179.25 crores in the last financial year. With the increase in capacity on account of expansion projects being undertaken by the company, it is expected that the company would be in a position to maintain the growth in future years.
Company has parked its surplus fund in the various debt schemes of mutual fund. There is an increase of 140% in investment from the previous year. Company is cash rich but as there are expansion and diversification plans under the pipeline, company is not utilizing these funds. For meeting the working capital needs and capacity expansion needs it has borrowed from banks.
The recent boom in the housing, construction and retail sector in India coupled with continued thrust of the Government on infrastructure projects is expected to sustain healthy growth of cement demand. During the year 2007-08, Indian cement industry has registered a growth of 9.34% in terms of cement production. Almost all the major players in the industry including Birla Corporation Ltd have announced substantial increase in capacity and the possibility of oversupply situation cannot be ruled out.
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During the year company has embarked upon expansion projects at Satna and Chanderia which would effectively enhance the cement capacity by 1.7 million tones. With the capacitive power plants already in operation and expansion projects under implementation, it is expected that the cement division of the company will do well in the foreseeable future.
The concern about the cement industry is that it is one of the most taxed industries in the country where the government levies and taxes, taken together, constitute over 70% of the ex-factory price. On the top of the above the increase in the cost of coal, railway freight and transportation charge have further added worries of cement manufactures.
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BIBLIOGRAPHY :-
www.birlacorporation.com
Annual Reports of BCL 10-11,11-12
www.birlacement.com
Finance department of BCL
www.google.com
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Annexure
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