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1.1 INDUSTRY PROFILE

The most emotional purchases anyone can make. When real estate

professionals work with top interior designers to create imaginative

living environments, consumers will be able to picture themselves at

home – they won’t have to re-imagine an empty space. Our hope is

that this event will create lasting partnerships between both

industries.”

Shreeji Asia is one of the most diversified construction group“Real

estate is not just about selling a space; it's about selling a lifestyle,

buying a home is one of s with activities across India, covering

development of commercial buildings, residential land and designing

false ceilings, and most other works related to the development of

classy global interiors.

Shreeji Asia Pvt. Ltd. is the parent company having two verticals

under it, that is, Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd. and

Shreeji Interiors.

Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd. is involved in

development of Infrastructure Projects with safety, reliability and

quality as their key principles.

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Shreeji Interiors is involved in executing designs in terms of

Furnishing, Civil, False Ceilings, Flooring, Carpentry, Electrical and

other works related to the development of Interiors.

The company also has Malur Facility which is used to develop

designs in large area, in minimum time frame and with precision.

1.2. A. INDIAN REAL ESTATE SECTOR - AN OVERVIEW

The real estate boom in India was inextricably linked to the country’s

economic stability, which had made India a preferred investment

destination.

India is on the verge of becoming one of the fast growing economies,

driven by many factors including multinational entrepreneurialism,

buoyant local stock markets, robust economy-changing demographics

and the overall emergence of India on the global stage. With great

demand for housing for India’s huge population and for commercial

and industrial premises for its booming economy, large-scale real

estate projects were launched across the whole country. This

transformed the real estate business into one of the most lucrative

sectors in the country. A sector which attracted venture capital and

diversified sources of funding including overseas and private domestic

funds and private equity funds. To create an environment friendly to

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foreign investors, foreign district investment up to 100 percent was

allowed in 2005 in townships, built-up housing and construction

development projects with the liberalization of FDI regulations. The

inflow of funding catalyzed the organized development. However, in

2008, the global meltdown in real estate produced a corresponding

downturn in the India real estate sector.

Needless to say, the real estate sector plays a significant role in the

Indian economy; it is second only to agriculture in terms of

employment generation and substantially contributes to the gross

domestic product of the country. The contribution of the real estate

sector to India’s gross domestic product (GDP) has been estimated at

6.3 per cent in 2013, and the segment is expected to generate 7.6

million jobs during the same period. It is also expected to generate

over 17 million employment opportunities across the country by 2025.

Moreover, the construction sector has also been responsible for the

development of over 250 ancillary industries such as cement, steel,

paints, brick, timber, building materials etc. A study by a credit rating

agency ICRA shows that the construction industry ranks third among

the 14 major sectors in terms of direct, indirect and induced effects in

all sectors of Indian economy. A unit increase in expenditure in the

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real estate sector can generate a fivefold increase in income. With the

downturn in the economy, and being a capital-intensive industry, the

real estate sector started to face a liquidity crunch emanating largely

from banks cautious approach to financing real estate companies. This

approach was reflected in lower loan-to-loan property value,

construction-linked payment ad financing only for projects nearing

completion. Further, real estate developers also had to cope with other

sources of funding, such as private equity and stock markets, drying

up considerably; receivables from residential projects under

construction getting blocked; falling demand and buyers deferring

payments until they took possession of properties. The resultant fall in

valuation I the past few months coupled with high interest rates and

low availability of money had put real estate developers on the

defensive and kept homebuyers away.

Riding high on the back of rapid urbanization, positive demographics

and rising income levels, the Indian real estate sector has attracted

significant investment over the past few years. The growing stability

of the market is reflected by the

Continuous growth of the core investors, with over Rs 7,705 crore

invested in ready office space during the last three years.

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1.2. B. Segments in the Indian Real Estate Sector

Fig 1.1 Indian Real Estate Sector Segments

1.2. C. Real Estate Market

The real estate sector in India is being recognized as an infrastructure

service that is driving the economic growth engine of the country. The

Indian real estate market size is expected to touch US$ 180 billion by

2020. Foreign Direct Investment (FDI) in the sector is expected to

increase to US$ 25 billion in next 10 years, from present US$ 4

billion.

Demand is expected to grow at a compound annual growth rate

(CAGR) of 19 per cent between 2010 and 2014, with tier I

metropolitan cities projected to account for about 40 per cent of this.

Growing infrastructure requirements from sectors such as education

health care and tourism are also providing opportunities in the real

estate sector.

The construction industry ranks third among the 14 major sectors in

terms of direct, indirect and induced effects in all sectors of the

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Real Estate SectorResidential SpaceCommercial SpaceRetail SpaceHospitality SpaceSEZs

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economy. The industry's growth is linked to developments in the

retail, hospitality and entertainment (hotels, resorts, cinema theatres)

sectors, economic services (hospitals, schools) and information

technology (IT)-enabled services (like call center’s) etc. and vice

Versa.

The sector is divided into 4 subsectors

Housing;

Retail;

Hospitality;

Commercial;

The housing sub-sector contributes five-six per cent to the country's

gross domestic product (GDP). Meanwhile, retail, hospitality and

commercial real estate are also growing significantly, catering to

India's growing needs of infrastructure. The Indian real estate market

size is expected to touch US$ 180 billion by 2020.

India is going to produce an estimated 2 million new graduates from

various Indian universities during this year, creating demand for 100

million square feet of office and industrial space.

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Fig 1.2 Growth Drivers of Real Estate Market

1.2. D. Market Players

The Indian real estate sector has traditionally been an unorganized

sector but it is slowly evolving into a more organized one. The sector

is embracing professional standards and transparency with open arms.

The major established domestic players in the sector are DLF,

Unitech, Hiranandani Constructions, Tata Housing, Godrej Properties,

Omaxe, Parsvanath, Raheja Developers, Ansal Properties and

Infrastructure and Mahindra Lifespace Developers Ltd to name a few.

International players who have made a name for themselves in India

include Hines, Tishman Speyer, Emaar Properties, Ascendas,

Capitaland, Portman Holdings and Homex.

i) DLF Ltd

DLF group is a leading real estate developer in India since 1946. DLF

has been instrumental in putting Gurgaon on the urban landscape of

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India. DLF has over 220 million sq. ft. of existing development

projects and 574 million sq. ft. of planned projects. DLF has so far

developed 22 urban colonies, and an entire integrated 3,000-acre

township - DLF City. DLF's development projects across India span

over 30 cities: Gurgaon, Ambala, Shimla, Amritsar, Jalandhar,

Ludhiana, Sonepat, Panipat, Chandigarh, Panchkula, Noida, New

Delhi, Jaipur, Indore, Ahemdabad, Baroda, Lucknow, Faridabad,

Mumbai, Pune, Nagpur, Goa, Kochi, Kokkanad, Chennai, Bangalore,

Vytilla, Coimbatore, Hyderabad, Bhubaneswar and Kolkata.

ii) Unitech

Established in 1972, Unitech is India’s leading real estate developer in

India. It is the first developer to have been certified ISO 9001:2000 in

North India.

Project Spectrum: Unitech offers diversified projects across

residential, commercial/IT parks, retail, hotels, amusement parks and

SEZs segments. Unitech was the first real estate company to be part of

the National Stock Exchange’s NIFTY 50 Index. The company has

over 600,000 shareholders. Unitech and Norway based Telenor Group

came together to build Uninor – a telecommunication services

company providing GSM services across India.

iii) Ansal API

Established in 1967 as a family business, Ansal API today is clearly

amongst the real estate leaders of India. Having established itself very

strongly in the NCR region, Ansal API is now focusing on ventures in

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cities like Bhatinda, Mohali, Amritsar, Ludhiana, Jalandhar, Jaipur,

Jodhpur, Ajmer, Sonepat, Panipat, Karnal, Kurukshetra, Faridabad,

Gurgaon, Greater Noida, and Ghaziabad, Meerut, Agra, Lucknow, to

name a few. Ansal API has till date, developed and delivered more

than 190 million sq ft. The company currently has a land reserve of

about 9,335 acres.

Project Spectrum: Integrated Townships, Condominiums, Group

Housing, Malls, Shopping Complex, Hotels, SEZs, IT Parks and

Infrastructure and Utility Services

iv) Sobha Developers Ltd.

The Company was founded in 1995 by PNC Menon after he returned

home from the Middle East where he was acclaimed for quality

interiors and construction since 1977. Today, this Rs10 billion plus

company is one of the largest and only backward integrated company

in the construction arena. Its IPO in 2006 was oversubscribed by 126

times that created history, being the first event of its kind in Indian

capital markets.

Till date, Sobha has completed 47 residential projects, 13 commercial

projects and 166 contractual projects covering about 36 million sqft

area in 18 cities across India (as of 31 March 2010). The company

currently has 21 ongoing residential projects aggregating to 8.5

million sqft, while 4.24 million sqft of contractual projects are under

various stages of construction.

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v) Parsvanth Developers Ltd.

Incorporated in July 1990 by Mr. Jain in New Delhi, Parsvnath today

has a substantial pan India presence in over 45 cities across 16 states.

The company has emerged as one of the most progressive and multi-

faceted real estate and construction entities in India.

Project spectrum: Housing (premium, mid-market as well as

affordable), office complexes, shopping malls & hypermarkets, hotels,

multiplexes, IT Parks and SEZs.

1.2. E. FINANCIAL SUPPORT TO THE SECTOR

In the Financial Years 2007-08, 2008-09 and 2009-10, the housing

and real estate sector attracted FDIs of 8.9%, 10.3% and 11%

respectively, of the total FDI in India. However, the financial year

2010-11 saw a mere 6% FDI in this sector. The year 2010 saw the

Indian real estate sector spring back into action after the gloom and

recessionary pressures experienced in the aftermath of the global

downturn. The focus on ‘affordable housing’ helped the sector tide

over the financial crunch it had witnessed. There is no doubt that the

sector holds huge potential to attract FDI in its various segments.

However, progress is possible only with the joint efforts of both the

industry and the Government. On the one hand, the industry should

work towards increased transparency, clear land titles, improved

delivery and project execution while on the other hand the

Government must provide fiscal incentives to developers to build low

cost and affordable housing for the masses and also review the

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existing FDI guidelines for investment and development in Indian real

estate in order to increase the flow of foreign capital into the sector.

1.2. F. BOOSTING R&D IN REAL ESTATE

The Government must provide incentives to the public and private

sectors to take up R&D activities for new building materials and

technologies so that the industry can deliver low cost, affordable, and

sustainable and environment friendly housing and building structures.

1.2. G. POLICY INITIATIVES

Government Initiatives

According to the latest reforms, FDI up to 100 per cent is

allowed under the automatic route in townships, housing, built-

up infrastructure and construction development projects to

increase investment, generate economic activity, create new

employment opportunities and add to the available housing

stock and built-up infrastructure.

The Ministry of Housing & Urban Poverty Alleviation has

planned to introduce a single-window system for clearance of

all real estate projects across the country. The system could

bring down the average approval time from the current 196

days to 45-60 days

The Government of India has sanctioned projects worth Rs

41,723 crores (US$ 7.51 billion)for building of 1,569,000

houses/dwelling units for economically weaker/lower income

group sections under the Ministry’s flagship Jawaharlal Nehru

National Urban Renewal Mission (JNNURM) programmes.

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Housing finances are becoming feasible with the housing loan

limit being raised to US$ 52080 for priority sector lending

Some of the initiatives taken in the union budget 2013-14 include:

For homes and flats with a carpet area of 2,000 square feet or

more or of a value of Rs 1 crore (US$ 180,213) or more, which

are high-end constructions, where the component of services is

greater, rate of abatement reduced from 75 to 70 percent

Rs 6,000 crore (US$ 1.08 billion) were given to Rural Housing

Fund

National Housing Bank plans to set up Urban Housing Fund. Rs

2,000 crore (US$ 360.47 million) will be provided to the fund in

the current financial year

1.2. H. Investments

Private equity (PE) investments in real estate investment, reveals that

approximately Rs 118.54 billion is available with private equity firms

ready to be deployed in real estate, despite a drop in the PE

investment in the first half of 2013. While PE investments in real

estate was recorded at Rs 16.38 billion in H1 2013, which is 46%

lower when compared to first half of 2012 (Rs 30.50 billion), PE

funds continue to show keen interest in the market with a number of

deals in discussion. This decline in the quantum of private equity real

estate investment (PERE) was essentially due to fewer deals (13 in H1

2013) as the average ticket size of deals remained same.

The total value of investments in the residential segment recorded at

Rs 9.3 billion in H1 2013 witnessed a drop of 48% over last year. The

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total value of investments in the office segment was also lower in H1

2013 at Rs 7.0 billion. However, there is a strong growing trend

towards investments in ready office space. The growing stability of

the market is reflected by the continuous growth of the core investors

(number and value) with over Rs 77.05 billion invested in ready office

space during the last three years.

In 2013, the highest value of private equity investments is noted in

Pune at Rs 7.8 billion followed by Mumbai at Rs 4billion, NCR at Rs

2.3 billion, and Bengaluru at Rs 1billion.

Some of the major investments in the Indian real estate sector are:

Ashiana Housing Ltd plans to foray into Gujarat's real estate

with its first project worth Rs 100 crore at Halol.

Mr. Akhilesh Yadav, Chief Minister of Uttar Pradesh (UP) has

inaugurated and laid the foundation of development projects

worth Rs 3,337 crore pertaining to Noida, Greater Noida and

Yamuna Expressway

Wave Infratech plans to invest Rs 500 crore to set up its first

affordable housing venture in the Delhi national capital region

(NCR) area

Mahindra Life space Developers has bought the stake of

private equity Arch Capital in its joint venture residential

project at Chennai. The buyout of the stake was estimated to be

around Rs 70 crore.

Godrej Properties Ltd (GPL) has signed a development

management agreement with United Oxygen Company Pvt Ltd

to develop residential housing project in Bengaluru. The

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project will offer approximately 1,000,000 sq. ft. of saleable

area and will be developed as a residential housing project.

1.2 .I. CHALLENGES AND INVESTMENT OPPORTUNITIES

CHALLENGES

The key challenges that the Indian real estate industry is facing today

are:

lack of clear land titles,

absence of title insurance,

absence of industry status,

lack of adequate sources of finance,

shortage of labour,

rising manpower and material costs,

approvals and procedural difficulties.

Investment Opportunities

The real estate industry in India is yet in a promising stage. The sector

happens to be the second largest employer after agriculture and is

expected to grow at the rate of 30 per cent over the next decade. A

growing migrant population due to increasing job opportunities,

together with healthy infrastructure development, is underpinning

demand in the region’s residential real estate market.

The Kalpataru spokesperson feels that the Finance Ministry's

motivation through softening of interest rates and lending more to the

real estate sector will have a positive impact on both developers and

consumers. The real estate market could start to perform better as the

easing of FDI norms will begin to show results during the second half

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of the year. The economy will also recover in 2013 which in turn will

perk up the real estate sector in India. With the government trying to

introduce developer and buyer friendly policies, the outlook for real

estate in 2013 does look promising.

1.2. J. THE ROAD AHEAD

India has huge potential to attract large foreign investments into real

estate. With real estate reaching a point of saturation in developed

countries and the demand and prices falling, global real estate players

are looking at emerging economies such as India for tapping

opportunities in real estate. Indian real estate will stay attractive due to

its strong economic fundamentals and demographic factors.

Moreover, there is a high level of global uncertainty looming over the

developed and developing nations of the world. While developed

economies are still struggling to regain their growth momentum,

developing countries including India and China are expected to grow

at a reasonably high rate. Investments in Indian real estate will fetch

higher returns for investors as compared to other global markets. In

the coming years, the opportunities in the real estate sector will attract

more global players to India and hence will help the industry to

mature, become more transparent, improve management and adopt

advanced construction techniques.

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1.2. K. INTERIOR DESIGN

INTRODUCTION

Interior design is more than just aesthetics. It's about finding creative

design solutions for interior environments while supporting the health,

safety and well being of occupants and enhancing their quality of life.

Following a systematic and coordinated methodology including

research, analysis and integration of knowledge into the creative

process, interior design is a multi-faceted profession whereby the

needs and resources of the client are satisfied to create an interior

space that fulfils the project goals.

1.2.L. HISTORY AND TRADITION OF INTERIOR DESIGN IN

INDIA

Interior Design is, in essence, a part of a larger discipline that is

Architecture. Both Interior Design and Architecture are the act of

designing within either a building or a space, and have been adopted

to differentiate the unique foci of work of the interior environment.

However, it wasn’t until the late 1980’s that Interior Design was

recognized as a discipline separate from Architecture in India. The

historical aspect of Interior Design is almost incomplete without a

reference to the grand Architecture that the nation fashioned.

From the times of the Rajahs and till today, Indian arts and crafts have

embellished plush luxurious homes around the world. Traditionally,

the luxury of a designed space was enjoyed only by the affluent in

India since it was only the rich who could afford to use expensive

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materials and hire craftsmen. This is established in the many palatial

buildings that India is home to.

On the other hand, the lower income groups worked with what nature

provided and created wonders in the least available. They created

marvelous structures which mark the resourceful and energy efficient

approach of the majority of Indians. India’s rich culture, diversity and

heritage have left us with a wonderful architectural legacy, whether its

mud houses in Rajasthan, sloping roofs in Konkan or the Tanku

houses with wind catchers in Khambat.

Post Independence, a new India was formed. Poverty stricken, India’s

growth had stagnated at a GDP of 3.5%. India maintained this GDP

for almost the next 40 years, until the economic liberalization in 1991.

The economic reforms brought about, changed the face of India by

exposing it to the open market, giving way to new avenues in the

design fields.

Until then Indians themselves never truly explored the potential of

design in the interior sector. Traditionally, Indian interiors are driven

by a pure utilitarian motive. Functionality is of prime importance.

Simplistic in its style, the interior design of an average house would

often consist of stone or mosaic flooring, painted walls, colonia

furniture handed down for generations, and local arts and crafts

adorning the walls.

Over the years, architects took on the responsibility of furnishing a

space and designed every aspect that went to its conception – from the

furniture to the art work to the tapestries. However, this level of

comfort, amenities and beauty, were restricted to spaces belonging to

the rich.

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Over the last decade, urban India has grown leaps and bounds, from

the failing third world country it once was. India is now one of the

world’s largest democracies and its continuous growth despite the

global meltdown has put money into the hands of the middle class

youth who are now living a lifestyle their parents had only dreamed

of. A well planned, professionally designed space is now well within

their grasp and its being reflected in the growing industry of Interior

design.

1.2. M. AN INTRODUCTION TO THE INTERIOR DESIGN

INDUSTRY

Interior Design, as a separate specialised design discipline, is a

relatively new field in India. It has now been recognized as a

profession different from decorators and architects dominating the

field for historic reason. Today, Interior design in India has come a

long way. It has gained autonomy from Architecture and is not just

reduced to decoration and furnishings anymore. Interior Design sees

space as a living environment and is a holistic resolution of the socio-

cultural, emotional and resource conditions of the context it

represents.

In the context of design, ‘Interiors’ refers to any space within an

enclosed structure that is inhabitable and human centred. These spaces

include residences, offices, institutions, schools, hospitals, theatres,

restaurants, hotels and resorts, airports and the like. This context also

spills onto the structures’ extensions such as porches, entrances,

swimming pools, landscaped areas, decks, patios etc.

The scope is so diverse in today’s times, that the aspects of Interior

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Design encompass all those contexts and more. This has led to Interior

Design’s fragmentation into a variety of specialized micro-disciplines

such as Residential Design, Office Design, Retail and Commercial

Design, and Hospitality Design.

1.2. N. TYPES OF INTERIOR DESIGN PROJECT

Interior design encompasses a variety of disciplines including

workplace, retail, healthcare, hospitality and residential design.

Whether you're ready to evaluate, renovate, or establish a new facility,

hiring a professional interior designer is a wise investment in the

successful outcome of a project. Types of interior design projects are

Fig 1.3 Types of Interior Design project

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RESIDENTIAL DESIGN

Thinking of buying a condominium or a house and can't

understand the builder's floor plans and how they will work for you?

Whether you are updating a bathroom or kitchen, planning a major

renovation or looking to add an extension to your home, an interior

designer can help you realize your design dream. An interior designer

will guide you through the process of choosing the right floor plan and

finishes.

Interior design begins with you. Our members are skilled at analyzing

the needs, goals, lifestyle and safety requirements of their clients and

integrating them into a functional and aesthetically attractive design

concept. Interior designers have unique training in designing interior

environments and are able to provide a full scope of services to

complete the project on time and on budget.

By hiring a professional interior designer for your next project, you're

adding value to your home, minimizing risk and keeping costs down.

Plus, with fees making up only a small portion of the overall real

estate/construction costs, hiring a qualified interior designer is a wise

investment in the successful outcome of your project.

WORKPLACE DESIGN

A well-designed corporate space or workplace environment can

potentially improve quality of life, promote productivity and increase

employee retention. Working with a professional interior designer is a

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sound business decision and the best way to ensure you get value for

your investment.

Have peace of mind in knowing that your project will meet the needs

of your business, be both functional and aesthetically pleasing and

make the most of available space. Our members can help guide you

through building technology, ergonomics, environmental and

sustainability issues, local building and fire codes as well as

accessibility guidelines. On more extensive corporate and workplace

environment projects, your interior designer may also:

• Act as Project Manager on your behalf to manage the project teams

through all phases of the project

• Develop and implement a branding and communications strategy in

relation to the project

• Undertake feasibility studies on potential facilities and coordinate

with real estate professionals•

Prepare and administer bids and contract documents as your agent

RETAIL DESIGN

Looking to maximize your display space and create a unique

shopping experience for your customers? Help ensure that your clients

have a memorable experience in your retail space by hiring a

professional interior designer. An interior designer is equipped to

realize your goals and make the interior environment of your business

effective and attractive. Rolling out several stores of the same brand?

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Interior designers are skilled at taking one brand and design concept

and adapting it to multiple locations.

Whether renovating, relocating, evaluating or establishing a new retail

facility, working with an interior designer is one of the best

investments a business owner can make. An interior designer will add

value to your facility, minimize risk and keep project costs down.

They ensure that the design complies with all regulatory and legal

requirements and that the health, safety and welfare of employees and

clients are protected. Plus, with fees making up a small portion of the

overall real estate/construction costs, hiring a qualified interior

designer can be an affordable investment in the successful outcome of

your project.

HEALTHCARE DESIGN

Interior design is much more than aesthetics. Well thought out

health-care spaces make a positive difference in the lives of patients

and employees, help ease the stress of medical visits, and ultimately

affect patient healing. Healthcare design encompasses not only

hospital environments but also general practice, dental and other

specialist offices as well as long-term care facilities. Whatever your

project needs, working with a professional interior designer will help

you realize a facility that meets the needs of staff and patients while

respecting strict infection control and building codes.

HOSPITALITY DESIGN

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Want to be on the top ten lists of hotels, restaurants and bars?

Consider design a key business strategy to pull customers into your

hospitality space.

Whether on holiday at a hotel or spa, or just out for a night on the

town, great hospitality design can shape a client's experience. Whether

you're renovating or constructing a new facility, working with a

professional interior designer can ensure that your clients have a

memorable experience in your space.

Most importantly, you'll be adding value to your project by maintains

project costs and minimizing risk by ensuring that the design complies

with all regulatory and legal requirements and protects the health,

safety and welfare of the occupants. At the end of the day, hiring a

qualified interior designer is a wise investment in the successful

outcome of your project.

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PART- B: - ABOUT THE SUBJECT:-

Introduction about the subject

Ratio Analysis:-

Fundamental Analysis has a very broad scope. One aspect looks at the

general (qualitative) factors of a company. The other side considers

tangible and measurable factors (quantitative). This means crunching

and analyzing numbers from the financial statements. If used in

conjunction with other methods, quantitative analysis can produce

excellent results.

Ratio analysis isn't just comparing different numbers from the balance

sheet, income statement, and cash flow statement. It's comparing the

number against previous years, other companies, the industry, or even

the economy in general. Ratios look at the relationships between

individual values and relate them to how a company has performed in

the past, and might perform in the future.

MEANING OF RATIO:

A ratio is one figure express in terms of another figure. It is a

mathematical yardstick that measures the relationship two figures,

which are related to each other and mutually interdependent. Ratio is

express by dividing one figure by the other related figure. Thus a ratio

is an expression relating one number to another. It is simply the

quotient of two numbers. It can be expressed as a fraction or as a

decimal or as a pure ratio or in absolute figures as “so many times”.

As accounting ratio is an expression relating two figures or accounts

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or two sets of account heads or group contain in the financial

statements.

MEANING OF RATIO ANALYSIS:

Ratio analysis is the method or process by which the relationship of

items or group of items in the financial statement are computed,

determined and presented.

Ratio analysis is an attempt to derive quantitative measure or guides

concerning the financial health and profitability of business

enterprises. Ratio analysis can be used both in trend and static

analysis. There are several ratios at the disposal of an analyst but their

group of ratio he would prefer depends on the purpose and the

objective of analysis.

While a detailed explanation of ratio analysis is beyond the scope of

this section, we will focus on a technique, which is easy to use. It can

provide you with a valuable investment analysis tool.

This technique is called cross-sectional analysis. Cross-sectional

analysis compares financial ratios of several companies from the same

industry. Ratio analysis can provide valuable information about a

company's financial health. A financial ratio measures a company's

performance in a specific area. For example, you could use a ratio of a

company's debt to its equity to measure a company's leverage. By

comparing the leverage ratios of two companies, you can determine

which company uses greater debt in the conduct of its business. A

company whose leverage ratio is higher than a competitor's has more

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debt per equity. You can use this information to make a judgment as

to which company is a better investment risk.

However, you must be careful not to place too much importance on

one ratio. You obtain a better indication of the direction in which a

company is moving when several ratios are taken as a group.

OBJECTIVE OF RATIOS

Ratio is work out to analyze the following aspects of business

organization-

A) Solvency-

1) Long term

2) Short term

3) Immediate

B) Stability

C) Profitability

D) Operational efficiency

E) Structural analysis

F) Effective utilization of resources

G) Leverages or external financing

STEPS IN RATIO ANALYSIS

The ratio analysis requires two steps as follows:

1] Calculation of ratio

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2] Comparing the ratio with some predetermined standards. The

standard ratio may be the past ratio of the same firm or industry’s

average ratio or a projected ratio or the ratio of the most successful

firm in the industry. In interpreting the ratio of a particular firm, the

analyst cannot reach any fruitful conclusion unless the calculated ratio

is compared with some predetermined standard. The importance of a

correct standard is oblivious as the conclusion is going to be based on

the standard itself.

TYPES OF COMPARISONS

The ratio can be compared in three different ways –

1] Cross section analysis:

One of the way of comparing the ratio or ratios of the firm is to

compare them with the ratio or ratios of some other selected firm in

the same industry at the same point of time. So it involves the

comparison of two or more firm’s financial ratio at the same point of

time. The cross section analysis helps the analyst to find out as to how

a particular firm has performed in relation to its competitors. The

firm’s performance may be compared with the performance of the

leader in the industry in order to uncover the major operational

inefficiencies. The cross section analysis is easy to be undertaken as

most of the data required for this may be available in financial

statement of the firm.

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2] Time series analysis:

The analysis is called Time series analysis when the performance of a

firm is evaluated over a period of time. By comparing the present

performance of a firm with the performance of the same firm over the

last few years, an assessment can be made about the trend in progress

of the firm, about the direction of progress of the firm. Time series

analysis helps to the firm to assess whether the firm is approaching the

long-term goals or not. The Time series analysis looks for (1)

important trends in financial performance (2) shift in trend over the

years (3) significant deviation if any from the other set of data.

3] Combined analysis:

If the cross section & time analysis, both are combined together to

study the behavior & pattern of ratio, then meaningful &

comprehensive evaluation of the performance of the firm can

definitely be made. A trend of ratio of a firm compared with the trend

of the ratio of the standard firm can give good results. For example,

the ratio of operating expenses to net sales for firm may be higher

than the industry average however, over the years it has been

declining for the firm, whereas the industry average has not shown

any significant changes

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BASED ON FINANCIAL STATEMENT

Accounting ratios express the relationship between figures taken from

financial statements. Figures may be taken from Balance Sheet, P& L

A/C, or both. One-way of classification of ratios is based upon the

sources from which are taken.

1] Balance sheet ratio:

If the ratios are based on the figures of balance sheet, they are called

Balance Sheet Ratios. E.g. ratio of current assets to current liabilities

or ratio of debt to equity. While calculating these ratios, there is no

need to refer to the Revenue statement. These ratios study the

relationship between the assets & the liabilities, of the concern. These

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ratio help to judge the liquidity, solvency & capital structure of the

concern. Balance sheet ratios are Current ratio, Liquid ratio, and

Proprietary ratio, Capital gearing ratio, Debt equity ratio, and Stock

working capital ratio.

2] Revenue ratio:

Ratio based on the figures from the revenue statement is called

revenue statement ratios. These ratios study the relationship between

the profitability & the sales of the concern. Revenue ratios are Gross

profit ratio, Operating ratio, Expense ratio, Net profit ratio, Net

operating profit ratio, Stock turnover ratio.

3] Composite ratio:

These ratios indicate the relationship between two items, of which one

is found in the balance sheet & other in revenue statement.

BASED ON FUNCTION:

Accounting ratios can also be classified according to their functions in

to liquidity ratios, leverage ratios, activity ratios, profitability ratios &

turnover ratios.

1] Liquidity ratios:

It shows the relationship between the current assets & current

liabilities of the concern e.g. liquid ratios & current ratios.

2] Leverage ratios:

It shows the relationship between proprietors funds & debts used in

financing the assets of the concern e.g. capital gearing ratios, debt

equity ratios, & Proprietary ratios.

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3] Activity ratios:

It shows relationship between the sales & the assets. It is also known

as Turnover ratios & productivity ratios e.g. stock turnover ratios,

debtors turnover ratios.

4] Profitability ratios:

a) It shows the relationship between profits & sales e.g. operating

ratios, gross profitratios, operating net profit ratios, expenses

ratios

b) It shows the relationship between profit & investment e.g.

return on investment, return on equity capital.

5] Coverage ratios:

It shows the relationship between the profit on the one hand & the

claims of the outsiders to be paid out of such profit e.g. dividend

payout ratios & debt service ratios.

BASED ON USER:

1] Ratios for short-term creditors:

Current ratios, liquid ratios, stock working capital ratios

2] Ratios for the shareholders:

Return on proprietors fund, return on equity capital

3] Ratios for management:

Return on capital employed, turnover ratios, operating ratios,

expenses ratios

4] Ratios for long-term creditors:

Debt equity ratios, return on capital employed, proprietor ratios.

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LIQUIDITY RATIO: -

Liquidity refers to the ability of a firm to meet its short-term (usually

up to 1 year) obligations. The ratios, which indicate the liquidity of a

company, are Current ratio, Quick/Acid-Test ratio, and Cash ratio.

These ratios are discussed below:-

CURRENT RATIO

Meaning:

This ratio compares the current assets with the current liabilities. It is

also known as ‘working capital ratio’ or ‘solvency ratio’. It is

expressed in the form of pure ratio.

E.g. 2:1

Formula: Current assets

Current ratio =

Current liabilities

LIQUID RATIO:

Meaning:

Liquid ratio is also known as acid test ratio or quick ratio. Liquid ratio

compares the quick assets with the quick liabilities. It is expressed in

the form of pure ratio. E.g. 1:1.

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The term quick assets refer to current assets, which can be converted

into, cash immediately or at a short notice without diminution of

value.

Formula:

Quick assets

Liquid ratio =

Quick liabilities

CASH RATIO

Meaning:

This is also called as super quick ratio. This ratio considers only the

absolute liquidity available with the firm.

Formula:

Cash + Bank + Marketable securities

Cash ratio = Total current liabilities

EARNING PER SAHRE:-

Meaning:-

Earnings per Share are calculated to find out overall profitability of

the organization. Earnings per Share represent earning of the company

whether or not dividends are declared. If there is only one class of

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shares, the earning per share are determined by dividing net profit by

the number of equity shares.

EPS measures the profits available to the equity shareholders on each

share held.

Formula:

NPAT

Earnings per share = Number of equity share

DIVIDEND PER SHARE:-

Meaning:

DPS shows how much is paid as dividend to the shareholders on each

share held.

Formula:

Dividend Paid to Ordinary Shareholders

Dividend per Share =

Number of Ordinary Shares

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DIVIDEND PAYOUT RATIO:-

Meaning:

Dividend Pay-out Ratio shows the relationship between the dividend

paid to equity shareholders out of the profit available to the equity

shareholders

.Formula:

Dividend per share

Dividend Payout ratio = × 100

Earnings per share

CAPITAL GEARING RATIO:-

Meaning:

Gearing means the process of increasing the equity shareholders

return through the use of debt. Equity shareholders earn more when

the rate of the return on total capital is more than the rate of interest

on debts. This is also known as leverage or trading on equity. The

Capital-gearing ratio shows the relationship between two types of

capital viz: - equity capital & preference capital & long term

borrowings. It is expressed as a pure ratio.

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Formula:- Preference capital+ secured loan

Capital gearing ratio =

capital & reserve & surplus

GROSS PROFIT RATIO:-

Meaning:

This ratio measures the relationship between gross profit and sales. It

is defined as the excess of the net sales over cost of goods sold or

excess of revenue over cost. This ratio shows the profit that remains

after the manufacturing costs have been met. It measures the

efficiency of production as well as pricing. This ratio helps to judge

how efficient the concern is I managing its production, purchase,

selling & inventory, how good its control is over the direct cost, how

productive the concern , how much amount is left to meet other

expenses & earn net profit.

Formula:

Gross profit

Gross profit ratio = × 100

Net sales

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NET PROFIT RATIO:-

Meaning:

Net Profit ratio indicates the relationship between the net profit & the

sales it is usually expressed in the form of a percentage

Formula:

NPAT

Net profit ratio = × 100

Net sales

RETURN ON CAPITAL EMPLOYED:-

Capital employed refers to the long-term funds invested by the

creditors and the owners of a firm. It is the sum of long-term liabilities

and owner's equity. ROCE indicates the efficiency with which the

long-term funds of a firm are utilized.

Formula:

NPAT

Return on capital employed = × 100

Capital employed

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DEBTORS TURNOVER RATIO (DTO)

Meaning:

DTO is calculated by dividing the net credit sales by average debtors

outstanding during the year. It measures the liquidity of a firm's debts.

Net credit sales are the gross credit sales minus returns, if any, from

customers. Average debtors are the average of debtors at the

beginning and at the end of the year. This ratio shows how rapidly

debts are collected. The higher the DTO, the better it is for the

organization.

Formula: Credit sales

Debtors turnover ratio =

Average debtors

INVENTORY OR STOCK TURNOVER RATIO (ITR)

Meaning:

ITR refers to the number of times the inventory is sold and replaced

during the accounting period.

Formula:

COGS

Stock Turnover Ratio =

Average stock

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FIXED ASSETS TURNOVER (FAT)

The FAT ratio measures the net sales per rupee of investment in fixed

assets.

Formula: Net sales

Fixed assets turnover =

Net fixed assets

PROPRIETORS RATIO:

Meaning:

Proprietary ratio is a test of financial & credit strength of the business.

It relates shareholders fund to total assets. This ratio determines the

long term or ultimate solvency of the company.

In other words, Proprietary ratio determines as to what extent the

owner’s interest & expectations are fulfilled from the total investment

made in the business operation.

Proprietary ratio compares the proprietor fund with total liabilities. It

is usually expressed in the form of percentage. Total assets also know

it as net worth. The Formula is:-

Shareholders fund

Proprietary ratio = Fixed assets + current liabilities

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STOCK WORKING CAPITAL RATIO:

Meaning:

This ratio shows the relationship between the closing stock & the

working capital. It helps to judge the quantum of inventories in

relation to the working capital of the business. The purpose of this

ratio is to show the extent to which working capital is blocked in

inventories. The ratio highlights the predominance of stocks in the

current financial position of the company. It is expressed as a

percentage.

Formula:

Stock

Stock working capital ratio =

Working Capital

DEBT EQUITY RATIO:

MEANING:

This ratio compares the long-term debts with shareholders fund. The

relationship between borrowed funds & owners capital is a popular

measure of the long term financial solvency of a firm. This

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relationship is shown by debt equity ratio. Alternatively, this ratio

indicates the relative proportion of debt & equity in financing the

assets of the firm. It is usually expressed as a pure ratio. E.g. 2:1

Formula:

Total long-term debt

Debt equity ratio =

Total shareholders fund

RETURN ON PROPRIETOR FUND

Meaning:

Return on proprietors fund is also known as ‘return on proprietor’s

equity’ or ‘return on shareholders’ investment’ or ‘investment ratio’.

This ratio indicates the relationship between net profits earned & total

proprietor’s funds. Return on proprietors fund is a profitability ratio,

which the relationship between profit & investment by the proprietors

in the concern. Its purpose is to measure the rate of return on the total

fund made available by the owners. This ratio helps to judge how

efficient the concern is in managing the owner’s fund at disposal. This

ratio is of practical importance to prospective investors &

shareholders.Formula: NPAT

Return on proprietors fund = × 100

Proprietor’s fund

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CREDITORS TURNOVER RATIO:

Meaning:-

It is same as debtor’s turnover ratio. It shows the speed at which

payments are made to the supplier for purchase made from them. It is

a relation between net credit purchase and average creditors

Formula:-

Net credit purchase

Credit turnover ratio =

Average creditors

IMPORTANCE OF RATIO ANALYSIS:

As a tool of financial management, ratios are of crucial

significance. The importance of ratio analysis lies in the fact that it

presents facts on a comparative basis & enables the drawing of

interference regarding the performance of a firm. Ratio analysis is

relevant in assessing the performance of a firm in respect of the

following aspects:

1] Liquidity position,

2] Long-term solvency,

3] Operating efficiency,

4] Overall profitability,

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5] Inter firm comparison

6] Trend analysis.

1] LIQUIDITY POSITION: -

With the help of Ratio analysis conclusion can be drawn

regarding the liquidity position of a firm. The liquidity position of a

firm would be satisfactory if it is able to meet its current obligation

when they become due. A firm can be said to have the ability to meet

its short-term liabilities if it has sufficient liquid funds to pay the

interest on its short maturing debt usually within a year as well as to

repay the principal. This ability is reflected in the liquidity ratio of a

firm. The liquidity ratio is particularly useful in credit analysis by

bank & other suppliers of short term loans.

2] LONG TERM SOLVENCY: -

Ratio analysis is equally useful for assessing the long-term financial

viability of a firm. This respect of the financial position of a borrower

is of concern to the long-term creditors, security analyst & the present

& potential owners of a business. The long-term solvency is measured

by the leverage/capital structure & profitability ratio analysis that

focus on earning power & operating efficiency..

3] OPERATING EFFICIENCY:

Yet another dimension of the useful of the ratio analysis, relevant

from the viewpoint of management, is that it throws light on the

degree of efficiency in management & utilization of its assets. The

various activity ratios measure this kind of operational efficiency. In

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fact, the solvency of a firm is, in the ultimate analysis, dependent

upon the sales revenues generated by the use of its assets- total as well

as its components.

4] OVERALL PROFITABILITY:

Unlike the outsides parties, which are interested in one aspect of the

financial position of a firm, the management is constantly concerned

about overall profitability of the enterprise. That is, they are

concerned about the ability of the firm to meets its short term as well

as long term obligations to its creditors, to ensure a reasonable return

to its owners & secure optimum utilization of the assets of the firm.

This is possible if an integrated view is taken & all the ratios are

considered together.

5] INTER – FIRM COMPARISON:

Ratio analysis not only throws light on the financial position of firm

but also serves as a stepping-stone to remedial measures. This is made

possible due to inter firm comparison & comparison with the industry

averages. A single figure of a particular ratio is meaningless unless it

is related to some standard or norm. One of the popular techniques is

to compare the ratios of a firm with the industry average. It should be

reasonably expected that the performance of a firm should be in broad

conformity with that of the industry to which it belongs. An Inter firm

comparison would demonstrate the firm’s position vice-versa its

competitors. If the results are at variance either with the industry

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average or with those of the competitors, the firm can seek to identify

the probable reasons & in light, take remedial measures.

6] TREND ANALYSIS:

Finally, ratio analysis enables a firm to take the time dimension into

account. In other words, whether the financial position of a firm is

improving or deteriorating over the years. This is made possible by

the use of trend analysis. The significance of the trend analysis of

ratio lies in the fact that the analysts can know the direction of

movement, that is, whether the movement is favorable or unfavorable.

For example, the ratio may be low as compared to the norm but the

trend may be upward. On the other hand, though the present level may

be satisfactory but the trend may be a declining one.

LIMITATIONS OF RATIO ANALYSIS

Ratio analysis has its limitations. These limitations are described

below:

1] Information problems

Ratios require quantitative information for analysis but it is not

decisive about analytical output.

The figures in a set of accounts are likely to be at least several

months out of date, and so might not give a proper indication of

the company’s current financial position.

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Where historical cost convention is used, asset valuations in the

balance sheet could be misleading. Ratios based on this

information will not be very useful for decision-making.

2] Comparison of performance over time

When comparing performance over time, there is need to

consider the changes in price. The movement in performance

should be in line with the changes in price.

When comparing performance over time, there is need to

consider the changes in technology. The movement in

performance should be in line with the changes in technology.

Changes in accounting policy may affect the comparison of

results between different accounting years as misleading.

3] Inter-firm comparison

Companies may have different capital structures and to make

comparison of performance when one is all equity financed and

another is a geared company it may not be a good analysis.

Selective application of government incentives to various

companies may also distort intercompany comparison.

Comparing the performance of two enterprises may be

misleading.

Inter-firm comparison may not be useful unless the firms

compared are of the same size and age, and employ similar

production methods and accounting practices.

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Even within a company, comparisons can be distorted by

changes in the price level.

Ratios provide only quantitative information, not qualitative

information.

Ratios are calculated on the basis of past financial statements.

They do not indicate future trends and they do not consider

economic conditions.

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RESEARCH DESIGN

A research design is a logical systematic plan prepared for directing a research study. it specifies the objectives of the study, the methodology and the techniques to be adopted for achieving the objective.

2.1 TITLE OF THE STUDY:

A study on “Ratio Analysis” of SHREEJI INTERIORS

2.2 STATEMENT OF THE PROBLEM:-

From last three years SHREEJI INTERIORS is facing the problem of the profit due to some financial reason. In this project some of the problems have identified by using ratio formulas.

2.3 OBJECTIVES OF THE STUDY:

To study liquidity solvency position of " SHREEJI INTERIORS"

To study understand financial performance through ratio analysis.

To study present and future earning capacity or profitability of the concern.

2.4 SCOPE OF THE STUDY:

The study is confined only to the information provided by finance and accounts department of " SHREEJI INTERIORS" and further the study has been restricted to financial analysis through accounting ratios only. This study supported by the company’s last three years balance sheet.

2.5 REVIEW OF LITERATURE

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Financial statements Analysis:

The financial statements of SHREEJI INTERIORS provide some extremely useful information to the extent that the balance sheet mirrors the financial position on a particular date in terms of the structure of assets, liabilities and owners’ capital and so on and the profit and loss account shows the results of operations during a certain period of time in terms of the revenues obtained and the cost incurred during the year. Thus, the financial statements provide a summarized view of the financial position and operations of a firm. Therefore, much learnt about a firm from a careful examination of its financial statements as invaluable documents performance reports. The analysis of financial statements is thus, an important aid to financial analysis.The focus of financial analysis is on key figures in the financial statements and the significant relationship that exists between them. The analysis of financial statements is a process of evaluating the relationship between component parts of financial statements to obtain a better understanding of the firm’s position and performance. The first task of the financial analyst is to select the information relevant to the decision under consideration from the total information contained in the financial statements. The second step is to arrange the information in a way to highlight significant relationships.

2.6 OPERATIONAL DEFNITIONS:

1] Assets: An asset is a resource controlled by the entity as a result of past events and from which future economic benefits are expected to flow to the entity.

2] Liabilities: An obligation of an entity arising from past transactions or events, the settlement of which may result in the transfer or use of assets, provision of services or other yielding of economic benefits in the future.

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3] Long Term Liabilities: The long-term liabilities are shown on the right wing of the balance-sheet representing the sources of funds, which are generally bounded in form of capital assets.

4] Current Liabilities: A bank’s debts or obligations payable within one year. Current liabilities appear on the bank’s balance sheet and include short term debt, accounts payable, accrued liabilities, and other debts.

5] Expenses: The economic costs that a business incurs through its operations to earn revenue. In order to maximize profits, businesses must attempt to reduce expenses without also cutting into revenues. Because expenses are such an important indicator of a business's operations, there are specific accounting rules on expense recognition.

6] Balance Sheet: A financial statement that summarizes a bank’s assets, liabilities and shareholders' equity at a specific point in time. These three balance sheet segments give investors an idea as to what the bank owns and owes, as well as the amount invested by the shareholders.

7] Current Ratio: A liquidity ratio that measures a company's ability to pay short-term obligations.

The Current Ratio formula is:

Current assets

Current ratio = ---------------------------

Current liabilities

8] Quick Ratio/ Liquid Ratio: An indicator of a company's short-

term liquidity. The quick ratio measures a company's ability to meet

its short-term obligations with its most liquid assets.

The quick ratio is calculated as:

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Current assets - Inventories

Quick ratio = ----------------------------------

Current liabilities

9] Absolute Liquid Ratio: Absolute liquid ratio extends the logic

further and eliminates accounts receivable (sundry debtors and bills

receivables) also. Though receivables are more liquid as comparable

to inventory but still there may be doubts considering their time and

amount of realization. Therefore, absolute liquidity ratio relates cash,

bank and marketable securities to the current liabilities. Since absolute

liquidity ratio lays down very strict and exacting standard of liquidity,

therefore, acceptable norm of this ratio is 50 percent. It means

absolute liquid assets worth one half of the value of current liabilities

are sufficient for satisfactory liquid position of a business. However,

this ratio is not as popular as the previous two ratios discussed.

10] Debt-Equity Ratio: A measure of a company's financial leverage

calculated by dividing its total liabilities by stockholders' equity. It

indicates what proportion of equity and debt the company is using to

finance its assets.

Formula:-

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Total liability

Debt-Equity Ratio = -------------------------------

Shareholder Equity

13] Inventory Turnover Ratio: A ratio showing how many times a

company's inventory is sold and replaced over a period. The days in

the period can then be divided by the inventory turnover formula to

calculate the days it takes to sell the inventory on hand or "inventory

turnover days".

The formula is:-

Sales

Inventory Turnover Ratio = -----------------------

Inventory

14] Debtors Turnover Ratio: An accounting measure used to

quantify a firm's effectiveness in extending credit as well as collecting

debts. The receivables turnover ratio is an activity ratio, measuring

how efficiently a firm uses its assets.

Formula:

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Net credit annul sales

Debtors turnover ratio = ---------------------------------

Average trade debt

2.7 SOURCES OF DATA:

Primary Data:-

The data is collected through discussions with the finance manager

and financial heads of the company.

Secondary Data:-

The primary data obtained has been supported with use of secondary

data collected from the books, annual reports, financial statements,

periodicals and other sources have been referred for data collection.

2.8 SAMPLE DESIGN:

It denotes the number of people surveyed actually and this sample size will be taken by adopting some type of sampling technique. Companies last three years of balance sheet as a sample three years balance sheet was taken on the basis of convenience.

2.9 METHODOLOGY:-

No series assumptions so far were made as to limit the usefulness of the study was made at any stage. However the following were made.

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A study period of three years.

The study has conducted through the balance sheet of the organization.

The solution has been found through the respective formula and then by the analysis and interpretation the conclusion has been provided to the organization.

2.10 TOOLS FOR DATA COLLECTION

The data collected from the various sources has to be processed and analyzed systematically.

These includes such as:

Identification of the absolute increase or decrease in the various assets and liabilities, reflecting the performance of the company.

Identification of the percentage chain in the assets and liabilities in the balance sheets of three years.

Application of ratio analysis and trained analysis of the period of the study.

Calculation of the various ratios reflecting the profitability, liquidity position of the company for the period of the study.

Finally, forwarding suggestions and conclusions. The above is the analysis plan for the research.

2.11 PLAN OF ANALYSIS:-

The data collected from the organization has been analyzed according to the objectives to the study. For this purpose a statistical tool ratio analysis are used along with the bar diagrams.

2.12 REFERENCE PERIOD:-

The accounts, various records and reports for period of three years are being referred for the purpose of the study.

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2.13 LIMITATIONS OF THE STUDY

1. The analysis is based on the information available from the company therefore the results depend on the accuracy of the reports of the company.

2. It is purely academic in the nature.

3. The analysis and the findings are related to SHREEJI INTERIORS and hence the findings cannot be generalized to other organization.

4. Based on the limited information it is not possible to arrive at proper conclusion.

5. The inferences that have been framed only on the basis of financial statements.

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2.14 CHAPTER SCHEME:-

Chapter- 1: Introduction

This chapter includes the subject’s background of research with

respect to the industry and the theory cal background of the subject.

Chapter- 2: Research design

It comprises of brief introduction of the problem, objectives of the

study, operational definitions, sampling tools of data and method

analysis, limitations of chapter layout.

Chapter- 3: Company profile

This chapter reveals the company growth and development in the

present scenario. It also contains the complete history of the company.

Chapter- 4: Data Analysis and Interpretation

This chapter gives the comprehensive analysis with respect to the

collected data and diagram call representation.

Chapter- 5: Summery Findings and Conclusion

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This chapter gives the summery of the analysis and interpretation,

valid findings of the study.

Chapter- 6: Recommendation and Suggestions

This chapter contains the suggestions as well as conclusions on the

base of the study conducted.

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1.3 COMPANY PROFILE

The Shreeji Group, since 2001, is a premier real estate

development company that focuses on multi-family residential, &

redevelopment projects. With the primary business being the

development of properties in residential, commercial and retail

sectors, the company's operations span across various aspects of

real estate development, such as

Land Identification and Acquisition,

Project Planning,

Designing,

Marketing & Execution,

Property Services and Estate Management.

Shreeji Asia Pvt. Ltd. Is one of the most diversified construction

groups with activities across India, covering development of

commercial buildings, residential land and designing false

ceilings, and most other works related to the development of

classy global interiors.

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Shreeji Asia Pvt. Ltd. Is the parent company having two

verticals under it, that is,

1. Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd.

2. Shreeji Interiors.

Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd. Is involved in

development of Infrastructure Projects with safety, reliability and

quality as their key principles. Shreeji Interiors is involved in

executing designs in terms of Furnishing, Civil, False Ceilings,

Flooring, Carpentry, Electrical and other works related to the

development of Interiors.

The company also has Malur Facility which is used to develop

designs in large area, in minimum time frame and with

precision.

The company has four main departments i.e. Business

Development, Purchase, Accounts and Human Resource. All the

departments work in accordance with each other in acquiring &

successfully completing the project. The Business Development

Department is responsible for bringing the projects to the

company. After the company gets a project, the Purchase

Department start purchasing the material required on the site and

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Accounts Department maintains the documents in Tally ERP 9

and MS Excel. The complete process of acquiring and executing

a project starts with market research. The Business Development

Department make calls to the companies that are expanding or

planning to expand in future. Various sources to get the name of

the companies are – Internet, Newspapers, Magazines, Personal

Contacts, Friends and Acquaintances. The details of the calls

made to the companies are entered in a database – Name of the

contact person, company’s address, call details, Name of the

person in charge of the upcoming project, contact number of the

person in- charge etc. Calls are made to the prospective clients

and Database is updated on the daily basis.

1.3. A. Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd.

SPI (ASIA) PVT. LTD.  Is a part of SHREEJI ASIA that is

dedicated to execution of infrastructure projects. Over years we

have developed expertise in building structures for commercial,

industrial and residential purposes, delivering products and

services of international standards. We have executed landmarks,

which are sky- high and cater to the most respectable members

of the society.

Having a deep understanding of the industry, technical and

financial aspects of investment projects, being aware of daily

challenges faced during execution of projects and the importance

of timely completion of work, we implement advanced planning

and risk management to not only meet but very often exceed

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our Client's expectations. We believe that this is the way we

make a difference in the industry.

Our highly dedicated Operations Team consists of experienced

Project Managers, Site Engineers, Site Supervisors and more

than 500 skilled laborers, who cooperate with our Support Team

to assure smooth and timely completion of the assigned projects.

Thanks to wise investments we have high- tech plant and

machinery at our disposal that supports us in delivering the best

quality products within the specified time frame. We cooperate

with a wide net of reliable suppliers to assure timely deliveries

and required quality of materials. Furthermore the quality of

materials and our work is internally supervised on a daily basis,

because at SHREEJI ASIA, we do not compromise on quality.

Treating safety of our employees and work as a priority, we

have implemented our own safety regulations and pride ourselves

in having 100% safety record since the inception of the

Company. 

1.3.B. Shreeji Interiors

At SHREEJI INTERIORS, we have developed exclusive expertise

in executing design in terms of civil work, false ceilings, flooring,

carpentry, electrical, plumbing, air-conditioning, painting, furnishing

and most other works related to the development of classy interiors. In

the process we have also developed a sustained understanding of the

aesthetical and functional demands of the market in terms of

distinctive architecture, interiors and decor.

All work is carried out under stringent supervision of our qualified

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Project Managers and a vast strong Support Team. We are currently

among the leading companies engaged in carrying out turnkey interior

projects with the factory setup of about 1 lakh sft, which is equipped

with the latest European technology available.

Our varied list of Clients speaks for our ability to carry out

challenging jobs within the required time frame as your project moves

from abstraction to physical reality. The key to our excellence is

enabling you to express your individuality and bring your concepts

from drawings to life. Our hands-on approach is consistent from

project's inception, throughout construction until completion.

Any project is fraught with challenges and uncertainties. There are

numerous decisions to be made which have a strong impact on how

the project looks and functions over period of time. Choosing the right

company makes all the difference between satisfactory jobs and great

jobs.

We believe in creating environment that are beautiful, functional and

cost-effective.

The company believes in creating a home or an office based on

an understanding of the stated and unstated consumer needs and

preferences. The company develops every property only after a

concentrated and focused market research to determine the

consumer needs and then the project is designed and

implemented according to consumer preferences. With a

remarkably versatile profile. The group’s activities comprise

developing, building and managing properties. In addition,

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the group also offers a wide range of allied services, for

individuals and companies.

More than a business venture, the Shreeji Group is a coming

together of ethically inclined professionals, with an abiding

commitment towards delivering value, to their customers and

stakeholders.

This convergence of diverse proficiencies, supported by moral

values, has resulted in a unique people-centric business

philosophy. Be it consumers, associates, institutions or its

employees, Shreeji Group is focused on people and their welfare.

The core values of the group thus comprise innovation, design

excellence, timeliness, fair business practices and commitment

towards the environment. Above all the group realizes that, its

activities can result in better and happy communities.

The Shreeji Group therefore ensures that, consumer preferences

are taken into account, while designing and developing

properties. As a natural consequence, architectural designs are

customized, to suit a location and enhance functionality and

beauty. The group also places an emphasis on ergonomics,

structural durability and strategic position of a site.

Shreeji’s people-centric projects invariably satisfy the aspirational

needs of people and the functional needs of corporate entities.

The legacy of outstanding projects has deservedly won them, the

abiding trust of its customers.

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The Shreeji Group is renowned for ethical business practices and

transparency in all its dealings. The group encourages open

communications and periodically informs all parties about, the

stage -by- stage progress, of a project. The company is strongly

rooted by the core values  T.R.U.S.T. -  The foundation of our

business, developed by being honest in all our dealings and

actions.

Teamwork 

To maximize efforts, satisfaction and results by having

everybody working together toward a common goal.

Resiliency 

To withstand the competitive and cyclical nature of our

industry by being dynamic, flexible, innovative and

operationally excellent. 

Understanding 

To meet clients' needs by first understanding our clients'

businesses and needs.

Service 

To practice servant leadership and develop a service-

oriented culture at all levels. 

Training 

To be a learning organization that helps people realize

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their full potential and provides promotional opportunities

from within.

1.3.D. Vision

They comprise utilizing the synergy, of the company’s ethical

business philosophy, innovation and core competencies and

convert every project, into a value –added proposition.

Every people-centric project, by the Shreeji Group, will thus

make use of quality building products, innovative designs and

modern technology, to offer the consumer a world-class

experience.

1.3.E. Mission

To shape, manage, revive and nurture space, as a sacred

community resource and thus build, with an emphasis on

structural durability, functionality, ergonomics and aesthetics, for

a better quality of life.

1.3.F. Corporate Social Responsibility

The Shreeji Group believes that, individuals and corporate entities

are products of beneficial social forces.

The group assigns a specific part of its profit, to serve the

purpose of education and health for the underprivileged.

We believe in nurturing & strengthening relationship with our

customers. We at Shreeji consider Trust, Respect, Loyalty &

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Goodwill generated through Customer relationship Management as

our most valuable asset.

PRODUCTS PROFILE

Having been in the industry for a long time, the company understand

the demands of the market in terms of distinctive architecture and

décor. Our highly dedicated and experienced Team is committed to

executing quality works, providing our Clients with customer-friendly

approach and true enthusiasm from project's planning stage till its

completion.

Products and Services

Infrastructure

Interiors

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Factor

As per Client's requirements, our scope of work ranges in size and

complexity from routine renovation and maintenance works to the

construction of complete buildings structures and providing our

Clients with turnkey solutions; from modest office and retail

installations to state of the art interior fit outs. Apart from that we

deliver carpentry products and services that are in compliance with

international standards.

  SHREEJI PIPALIYA INFRASTRUCTURE (ASIA) PVT.

LTD. we serve a wide range of Clients, providing them with world-

class commercial, industrial and residential premises. Every year 80%

of our projects are executed for our repeat Clients, who look to SPI

(ASIA) to complete each assignment at an efficient, cost-effective and

professional manner.

At Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd. we own high-

tech equipment to support our performance in terms of time and

quality. We always keep in mind the precision and safety of our work,

therefore we use brand new machinery of world-class makers.

To add to our competitiveness we have our own manufacturing

facilities of carpentry products. The machinery of European most

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accredited brands and best carpenters assure that our products are

beautiful, functional and their quality exceeds international standards.

At SHREEJI INTERIORS, we service a whole range of Companies,

Architects and Interior Designers. We have very high standards for

the type of work we do and have lived up to the time frames and

standards set by our Clients.

COMMERCIAL

M/s. ABB

M/s. Accenture

M/s. Alcon Laboratories

M/s. Areva

M/s. Bagmane WTC 3

M/s. Embassy Tech Square

M/s. General Electric

M/s. Glow Network I & II

M/s. Gokuldas Export

M/s. Helion

M/s. iGATE

M/s. iOPEX

M/s. Lanco Hills

M/s. MOOG I & II

M/s. Motwani Builders Pvt. Ltd.

M/s. RMZ

M/s. TCS

M/s. Triveni

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M/s. UST Global

M/s. VOLVO

HOSPITALITY

M/s. ABB Guesthouse

M/s. Desai Bro's Farmhouse

M/s. Esteem Silk Pvt. Ltd. Farmhouse

M/s. Hotel Royal Orchid (Doddis Resort)

M/s. Hotel Shelton Grand

RETAIL

M/s. Citi Bank

M/s. C Krishniah Chetty & Sons

M/s. Ducati 

M/s. Kapoor Lamps 

M/s. Levi's Museum Store

M/s. Neptune Travels

EDUCATION

M/s. British Library

 RESIDENTIAL

M/s. Prestige - Acro Polis

M/s. Brigade Crescent

M/s. Brigade Exotica

M/s. Brigade Homestead

M/s. Brigade Mayfair

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Mr. Deepak Motwani

Mr. Dinesh Hinduja

Mr. Jai Shankar

Mr. Kanti Bhura

Mr. Nandan Nilekani

Ms. Pavitra Shankar

Mr. Rajan Hinduja

Mr. Vijay Kumar Yadalam

CARPENTRY FACTORY

At SHREEJI ASIA, we are well aware of all the industrial

expectations and demands growing high. Having passion for creating

a landmark in the interior industry, we have made wise investments

into our Bangalore Factory. Our plant and machinery allows us to

deliver products matching or even exceeding the standards expected

by most demanding Clients from top end hospitality sector.

We manufacture a wide range of Furniture.

Modular furniture

Loose& fixed furniture

luxurious carpentry products

For corporate, residential and hospitality purposes. Our products are

distinguished by their functionality, user-friendliness and fine design.

Having control over the manufacturing process, we are able to deliver

carpentry products for a maximum area size within a minimum time

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frame, assuring the best workmanship, quality and precision higher

than the European norms demand.

We are the first company in India to have the mentioned set of

European most renowned machinery. Together with our interest in

craftsmanship and detailing, passion and experience, we are now

capable of innovating the execution procedures and assuring a faster

delivery at a better price.

Interiors Factory- Unit I (87,412 Sft), Malur Industrial Area

Machinery Nos.

CNC Machining Centre 1

Computerized Edge Bender 1

Computerized Panel Saw 2

Computerized Profiling/ Shaping Machine 1

Misc other machineries 6

Interiors Factory- Unit II, Mysore Road

Machinery Nos.

NC Multi Boring Machine 1

Post Forming Machine 2

Wide Belt Sanding Machine 1

Instant Laminate/ Veneer Press 1

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Misc other machineries 8

COMPETITORS PROFILE

Competitor profiles enable us to see at a glance the information you

need on your competitors. Depending on the format and content, they

can provide anything from the background information required by

the sales force to the information that the board needs when

investigating potential acquisitions or deciding major strategic

initiatives against a competitor. The exact format will depend on your

needs and the key intelligence topics you want covered.

Each competitor profile should be customised so that the focus is on a

specific aspect. For example the sales force need to know your

competitive situation:

Who else is selling similar products and services?

How?

At what price?

Through which channel?

What promotional materials are used?

What sales tactics are used?

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And so on.

This sales focused kind of profile will include information that will

help your sales team to sell effectively answering customer queries

about your products or services compared to competitor equivalents,

However it would have no or less information on the competitor's

strategies, operations or finances. Such information would be included

in a profile drafted for senior / board level management, which might

have less of the sales-type data.

1.5.A. COMPETITORS

DESIGN ARC INTERIOR

Design Arc Interior is a highly revered interior décor and interior

design company offering exclusive services in home interior

designing, commercial interior designing as well as 3D visualization

services to clients in Bangalore and Dubai. The teams of highly

skilled and respected interior designers in Design Arc Interior offer

their exclusive interior designing. A highly prolific interior designing

company specializing in residential space design, commercial spaces

design as well as services in 3D visualization.

Founded in 2006, Design Arc Interiors is an interior décor and interior

designing company offering exclusive services in living and work

place interior design in Bangalore and Dubai. They work in

partnership with Cambridge Electro Mechanical located in Abu

Dhabi, UAE, who work in close coordination with DAI with all

interior projects in Dubai.

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SAVIO & RUPA

Savio & Rupa Interior concepts offer a comprehensive range of

interior design and furnishing solutions for residential and commercial

spaces. Their innovative design ideas seek to take care of short term

requirement as well as protect long term investments. They’re

committed to deliver superior and classy interiors with a judicious

blend of the aesthetics and functional aspects.

THE DESIGN FIRM

“The Design Firm” is an innovative Bangalore based practice

established in October 2005, specializes in high quality designs for all

range of projects. Its distinctive Architectural and interior designs

serves range from design ideas and feasibility studies through to

development of concepts.

“TDF” combines all aspects of a project from producing concepts to

construction drawings which embraces functionality to aesthetics,

maximizing space, light and form being in harmony with property’s

natural surroundings and professionally manages each project through

to completion.

KUVIO STUDIO

KUVIO STUDIO is an Interior Design firm established specially with

a passion to bring to life your space of dreams. Founder Richa Singh

and her team at KUVIO STUDIO come with the collective design

experience of 15 years ranging from residential, commercial and retail

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spaces at Bangalore, New Delhi, Mumbai and Lucknow. We approach

design for each project with a personal touch and sense of ingenuity.

Organizational structure

The organization structure of SHREEJI Asia is hierarchy type

where all the managers of various department that is Business

Development Department, Project Management department, Human

Resource department Purchase Department and account department

needs to report directly to the Managing Director of the company.

Fig 2.1 Organization Structure of SHREEJI ASIA

3.1 FUNCTIONAL DEPARTMENTS

Functional departments are those departments in which different functions of an organization takes place i.e. Grouping of individuals on the basis of the function each performs in the organization, such as accounting, marketing, manufacturing or grouping of activities or processes on the basis of their need in accomplishing one or more tasks. There are various functional

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Managing DirectorHR TeamDirectorProjects TeamPurchase TeamAccounts Team

SHREEJI ASIA

departments are there in every organization. They are Marketing, Sales, HR department, IT, Operations, R & D, etc

3.2 FUNCTIONAL DEPARTMENTS OF SHREEJI ASIA

The various departments of SHREEJI ASIA are

1) Projects

2) Finance & Accounting

3) Human Resource

4) Business Development

The company has four main departments i.e. Business Development, Purchase, Accounts and Human Resource. All the departments work in accordance with each other in acquiring & successfully completing the project. The Business Development Department is responsible for bringing the projects to the company. After the company gets a project, the Purchase Department start purchasing the material required on the site and Accounts Department maintains the documents in Tally ERP 9and MS Excel.

1. Projects

Project Management is the art of managing all the aspects of a project from inception to closure using a scientific and structured methodology. The term project may be used to define any endeavour that is temporary in nature and with a beginning or an end. The project must create something unique whether it is a product, service or result and must be progressively elaborated. As the definition implies, not every task can be considered a project. It would be worthwhile to keep this definition in mind when categorizing projects and studying their role in the success of the organization. With the above definition of the project, one gets a clear idea on what a project is.

Program Management is defined as a department that centralizes the management of projects. What this means is that the PMO or the

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Project Management Office is a repository of all the projects that are being executed in an organization. Program Management serves the CIO (Chief Information Officer) by providing him or her with regular status updates regarding the progress of all the projects in the company.

The PMO’s role is to ensure that the projects are financially viable and to raise an alert whenever there is a possibility or occurrence of a cost overrun. The PMO also keeps tab on the billing and other details that are concerned with the project. Thus, the PMO’s function is to oversee the projects coming under its domain and act as a kind of monitoring agency for them. In the current scenario, there is a need for visionary leadership by the CIO’s in addition to the technical leadership.

Technical leadership is the ability to spot trends in the technical space and leverage them for the success of the project. This involves choosing the right technology and being able to stay ahead of the curve with respect to new technologies. On the other hand, program visionary leadership is needed to control costs and effectively manage productivity increases and tighter integration of processes. This is relevant in the context of the ongoing economic crisis where the accent is on cutting costs and improving the bottom line.

The Project Manager’s role is to ensure that the overall objectives of the project are achieved with the participation of each individual member. The project manager is like the Prima Donna and his or her acumen depends on how well he or she can leverage the strengths of the individual members while minimizing the impact of their weaknesses. Program managers take the same view but at a much higher level. Their job is on the overall bottom line for the division or the company and they drive the individual project managers.

PROJET MANAGER

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Fig 3.1 Project Management Department in Shreeji Asia

Finance & Accounting

Financial Management means planning, organizing, directing and controlling the financial activities such as procurement and utilization of funds of the enterprise. It means applying general management principles to financial resources of the enterprise.

Cost Analysis is the site wise description of all the expenses incurred by the company in executing projects. We have used MS Excel to prepare the Cost Analysis. The expenses and their description are arranged under various types of categories and sub categories. This helps the management to determine the areas where expenses are more than anticipated and steps can be taken to reduce the expenses in the ongoing projects. The Excel sheet is kept as a record of all the expenses for a particular site.

The accounts department maintains five main kinds of documents:

Purchase Order

Purchase Bills

Cash Vouchers

Bank Vouchers

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HEAD PROJECT MANAGERPROJECT MANAGERSENIOR SITE ENGINEER

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Sub Contractors’ Bills

Purchase Order:

Purchase Order is a document which is send to the vendors to supply a particular product(s)

PURCHASE DEPARTMENT

Fig 3.2 Purchase Department in Shreeji Asia

Purchase Bill:

Purchase Bill is a document which is generated by the vendor and sent to the company. The Purchase Bill is either delivered on the site along with the material or is sent to Office.

Cash Voucher:

Cash Voucher is a document generated in the company when cash payment is made against a bill. Any type of Cash payment from the company is recorded in cash voucher. Cash payments are given for small purchases. Generally Miscellaneous expenses like – Labor Food

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HEAD PURCHASE MANAGERSENIOR PURCHASE MANAGER

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Expense, Water expense, Fuel Expense and all the purchases done without Purchase Order are paid through Cash.

Bank Voucher:

Bank Vouchers are generated by the Company whenever expenses are done by any of the following modes:

Cheque

Demand Draft

RTGS – Real Time Gross Settlement

NEFT – National Electronic Fund Transfer

These modes are used to pay large sums of money. Generally, payment against Purchase Bills is done through these modes. Unlike Cash Book, the details of Bank Vouchers are entered in Tally.

2. Human Resource

We often hear the term Human Resource Management, Employee Relations and Personnel Management used in the popular press as well as by Industry experts. Whenever we hear these terms, we conjure images of efficient managers busily going about their work in glitzy offices. In this article, we look at the question “what is HRM?” by giving a broad overview of the topic and introducing the readers to the practice of HRM in contemporary organizations. Though as with all popular perceptions, the above imagery has some validity, the fact remains that there is much more to the field of HRM and despite popular depictions of the same, the “art and science” of HRM is indeed complex. We have chosen the term “art and science” as HRM is both the art of managing people by recourse to creative and innovative approaches; it is a science as well because of the precision and rigorous application of theory that is required.

HR FUNCTION OF SHREEJI ASIA PVT LTD

RECRUITMENT AND SELECTION POLICY

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Introduction

Recruitment and Selection aim to search and hire suitable candidate to fill vacancies in Shreeji House with the view to satisfying human resources needs. The search may be internal and/or external.

Any position within Shreeji House that becomes vacant will be filled, on completion of a requisition form by the immediate supervisor. The success and adaptability of a Company depends upon the recruitment of employees who are flexible, adaptable and committed to the success of the Shree Asia.

Objectives

This section aims to promote and maintain high standards of professional recruitment practice by encouraging recruiters to adhere to best practices. Its purposes are to:

a) Ensure that recruitment is considered an essential part of the human resource

b) Strategy and consequently an integral part of the overall business strategy;

c) Ensure and explain best practice for all types of recruitment;

d) Maintain professional standards whether recruits are easy to find;

e) Ensure that equality of opportunity is considered an integral part of good recruitment practices and procedure;

Appointment

All staff will be appointed by the Shreeji Asia Pvt. Ltd. through an interview process. The interview mainly consists of two rounds i.e., Aptitude test and HR round and final round.

Letters of Appointment: The formal letter of appointment will bear the signature of the Managing Director as delegated. The letter shall

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require the signature of the appointee before the appointment is considered effective.

Job Description: On appointment, an employee shall be given a job description. This shall specify the scope and terms of reference for their position. Each member of staff is expected to devote their time and attention to their work and not engage in activities that may conflict with Shreeji Asia Pvt. Ltd.’s interests or negatively affect their performance. Job Descriptions shall be reviewed yearly.

Probation: Any appointment made on Shreeji Asia Pvt. Ltd. shall be subject to a probation period as specified in the letter of appointment. Six months towards the end of the probation period, employee’s immediate supervisor shall make an appraisal report recommending a confirmation or termination of the employee’s services. Where necessary, the probation period may be extended as considered necessary by the HR Team. An employee who is on probation may have his appointment terminated at any time without notice. In the event of such termination, the employee is paid for the period worked up to the time of termination

Duration of employment: Unless otherwise stated, employment for all staff shall be on permanent basis subject to satisfactory completion of the probation period and availability of funds.

Induction

All new staff shall undergo induction training to assist them in the process of becoming integrated to the institution within the shortest time possible. The respective immediate supervisor in collaboration with the HR Officer shall conduct induction training.

TRANSFER & SHIFTING POLICY

For the benefit of the organization, staff may be required to be transferred OR shifted from one unit to other.

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Transfer & shifting both will mean relocation of staff from one unit to another.

The authority of the organization will decide the transfer or shifting as per the necessity of the organization.

The staff should be apprised by the immediate supervisor regarding the transfer or shifting.

In case of shifting the staff will get no additional benefit.

PERFORMANCE MANAGEMENT

Introduction

Decisions concerning career development, promotion, succession planning and compensation depend on information provided through effective performance management. The organization will therefore ensure that all new employees understand the requirements of their jobs as well as the expected results. The actual assessment of how well they have done will be undertaken at the end of each year through a comprehensive appraisal of their performance in relation to these expectations.

Objectives

Staff appraisal is often viewed as a punitive measure where most junior staff looks it as a time when their seniors would get even with them for whatever reason. Shreeji Asia Pvt. Ltd. will therefore seek first to promote a healthy understanding of this process in terms of being an avenue to promote dialogue between staff and management as well as a system through which specific needs of staff are identified and brought into the limelight

The Performance Management Process:

Performance Planning

Monitoring

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Performance Summary

Recognition

PERFORMANCE PLANNING:

A Performance Plan is a written document between an employee (or team) and his or her manager. The performance plan describes what has to be done during the performance cycle, how well it has to be done, and how the accomplishment will be measured. This part of the plan is based primarily on the goals of SHREEJI ASIA PVT. LTD. and the employee's job description.

Requirements for Temporary Positions: A performance plan should be established in all cases where the duration of the temporary employee is uncertain. A new performance plan must be established when an employee is scheduled to work for 90 days or longer.

MONITORING

Monitoring is the process of making accurate and objective performance observations based on the outcomes and expectations contained in an employee's performance plan. In addition, the manager will provide timely feedback throughout the performance cycle to encourage employees to maximize their performance. Performance observations will be provided from multiple sources.

PERFORMANCE SUMMARY

The performance summary is a consolidation, discussion, and acknowledgement of employee accomplishments and effectiveness throughout the performance cycle.

a) Provides an assessment of actual achievements based on the outcomes and expectations contained in the performance plan.

b) Includes a synopsis of formal feedback received during the performance cycle.

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c) Contains highlights of developmental activities undertaken during the period.

RECOGNITION

A means of acknowledging employees for sustained outstanding performance/service and providing incentives to continue provide outstanding performance/service. Recognition should be linked to performance outcomes. For example, employees should be recognized/rewarded for being results-oriented and customer-focused. Other contributing factors could be increased morale, contribution to team cohesiveness, contribution to the success of the performance management process, etc. Recognition does not necessarily have to be linked to a bonus system, but can be for e.g.; time off, chance to attend conferences of choice etc.

TRAINING AND DEVELOPMENT POLICY

Introduction

Shreeji Asia Pvt. Ltd. strongly believes that a well-trained and efficient workforce is crucial for the development of any institution. As such, we will always strive to attract and retain employees of the highest caliber.

To achieve this, Shreeji House will recruit all levels of staff strictly on merit. After their engagement, the trust will further provide them with opportunities to advance skills and professional expertise as well as give them adequate exposure.

Objectives

The objectives of the Training and Development Policy are to:

a) Ensure that training and development are offered to employees of Shreeji Asia Pvt. Ltd.

b) ensure that need-based training and development interventions are equitably distributed to all categories of staff and at all

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levels of Shreeji Asia Pvt. Ltd., with particular emphasis on the lower ranks;

c) Ensuring equal opportunity in training and development within all Department of Shreeji Asia Pvt. Ltd..

d) Develop and maintain a pool of suitably qualified staff (technical, administrative and professional) at Shreeji Asia Pvt. Ltd.;

e) Create an environment that is conducive to self-development and career advancement of staff members;

f) Process and Criteria

Shreeji Asia Pvt. Ltd. will handle staff training as an integral part of its organizational development. It will endeavor to train its staff continuously and impart them with new skills, through some of the following ways:

Training or development programme shall only be offered after a through needs assessment by the Human Resources Officer in consultation with the Department Managers. Shreeji Asia Pvt. Ltd. places a high premium on human resources training and development.

Any training identified by individuals shall also be considered. Where these activities are deemed important by Shreeji Asia Pvt. Ltd., an equitable selection process of who shall attend the course shall be made and Shreeji Asia Pvt. Ltd. shall fully fund the activity subject to the following conditions:

The employee must submit a formal application to his supervisor;

The application shall be forwarded by the supervisor, with his/her recommendations and comments to the Head of Department;

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Approval will thereafter have to be obtained from the Human Resources Officer.

3. BUSINESS DEVELOPMENT

Business development is being practiced by the almost all the major companies. It is now being adopted by the small business too as they also look forward to grow. Business expansion needs a set of skills and different approaches. There no single business strategy that could fit every business. Therefore, every firm or organization needs to work hard, identify its requirements and then work on them. There are a lot of functions which a business development department or a business development teams needs perform. Some common functions of business expansion department are as follows:

THINKING OF NEW IDEAS

The very first function of a business growth team or department is to think of new ways of doing business. They should either come with a new idea or they should bring improvement in the existing processes. This function of business development department brings continuous improvement in the business process and techniques.

GATHER CAPITAL

The main responsibility of gathering funds is on the finance department of any organization but the business growth department needs to play an important role in this regard. They need to gather the resources from which they can take up capital to enhance the business.

MANAGING RELATIONSHIP

Managing relationships is one of the most important duties of the business development department. They need to manage the relationships with the existing clients whereas build relations with the new clients. In today's business world it is difficult to find a reliable and loyal client. And it is even more difficult to retain them. Therefore, a business development manager or the business

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development team manages the relations with the clients. Tries to identify their problems and report to the company so that the problems could be solved. In other words they are the one to make sure that the client is getting the maximum satisfaction or not.

BUILDING JOINT VENTURES

At times certain situations occur when a single business cannot handle a project and it needs the help of another business to run the project successfully. In such situations business enter into joint venture contracts and start joint venture projects. There are a lot of examples in the business world where two major organizations start a single project. The business growth department of the organization is liable to find the most reliable business partners and maintain good long-term relations with them too.

FULFILLING REQUIREMENTS

Fulfilling the commitments is the key to business development. One of the responsibilities of the business development department is that they must fulfill the commitments made by the clients. They must communicate with the other departments of the organization effectively and represent their organization in front of the business clients. They must be true and honest with the clients and they must make it sure that the commitments are being fulfilled.

BUSINESS DEVELOPMENT

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Fig 3.3 Business Development Department in Shreeji Asia

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HEAD BUSINESS DEVELOPMENTREGIONAL SENIOR MANAGERAREA SENIOR MANAGER

SHREEJI ASIA

90

STRENGTH:Personalized client serviceGood referral relation with architect, vendors.Client loyaltyWEAKNESS:Need more financial analysisSeasonality of the businessOPPORTUNITIES:Changing design trendsNew clients in wider geographyTHREATS:Continued price pressureEntry of new firmLack of visual presence

SHREEJI ASIA

The following ratios have been chosen: -

1. Current ratio

2. Quick ratio

3 Debt/equity ratio

4. Net profit ratio

5. Operating cost ratio

6. Return on investment

7. Return on working capital

8. Stock turnover ratio

9. Debtors turnover ratio

10. Fixed assets turnover ratio

11. Working capital turnover ratio

12. Creditors turnover ratio

13. Capital turnover ratio

14. Operating cost ratio

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1. CURRENT RATIO

Meaning:-

This ratio compares the current assets with the current liabilities. It is also known as ‘working capital ratio’ or ‘solvency ratio’. It is expressed in the form of pure ratio.

Formula:-

YEAR

CURRENT

ASSETS

(In Rs.)

CURRENT

LIABILITIES

(In Rs.)

CURRENT

RATIO

2010-2011 1,56,73,262.86 1,34,20,567.03 1.17:1

2011-2012 3,76,05,804.27 1,75,82,387.41 2.14:1

2012-2013 7,29,69,335.90 3,46,66,200.82 2.10:1

Table-4.1 CURRENT RATIO

Analysis:-

The analysis shows that the current ratio of the company in the year

2010-11 is 1.17, 2011-12 is 2.14 and 2012-13 is 2.10. This also shows

that company is maintaining good liquidity position. Only 2010-11,

the ratio of the company decreases compares to 2011-12 and 2012-13.

92

Current assets

Current ratio = -------------------------

Current liabilities

SHREEJI ASIA

Interpretation:-

The current ratio of the company having lesser than the standard ratio

i.e. 2:1 only in 2010-11 and later year company is maintaining

standard ratio in 2011-12 & 2012-13. So company is maintaining their

good liquidity position i.e. standard ratio 2:1

2. QUICK RATIO

Meaning:-

This is the real index of the financial liquidity of the concern. It

calculates the company’s liquid assets in relation to its liabilities. It is

also called as acid test ratio or liquid ratio.

Formula:-

93

Quick assets Quick ratio = ------------------------------------ Quick liabilities

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Table-4.2QUICK RATIO

YEAR QUICK

ASSETS

QUICK LIABILITIES

QUICK

RATIO

2010-2011 5576282.86 13420567.03 0.42:1

2011-2012 11727598.27 17582387.41 0.67:1

2012-2013 21532685.9 34666200.82 0.62:1

Analysis:-

A quick liability consists of current liabilities for the year 2010-11,

2011-12, and 2012-13. Whereas quick asset consists of cash and bank

balance, advances and other assets; expect for the prepayments.

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0.42

0.67

0.62

QUICK RATIO

2010-112011-122012-13

Interpretation:-

A quick ratio of 1:1 is considered to represent a satisfactory current

financial position. In the year 2010-11, the liquidity ratio is low as

compared to 2011-12 and 2012-13. The company is not maintaining

their quick ratio in a better way. Company need to utilize its current

assets in much better way to meet its current liabilities.

DEBT EQUITY RATIO

Meaning:-

This ratiomeasures the relationship between long term debt and

capital. In other words, this ratio measures the relative claims of long

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term creditors on the other hand and owners on the other hand, on the

assets of the company.

Formula:-

Table-4.3 DEBT EQUITY RATIO

YEAR LONG TERM

DEBTS

OWNER’S

CAPITAL

DEBT EQUITY

RATIO

2010-2011 4763025.25 11147121.58 042:1

2011-2012 17731901.40 9906519.56 1.79:1

2012-2013 35732782.81 15228671.08 2.35:1

ANALYSIS:-

Here the debt equity ratio consists of long term debt and owner’s

capital. In 2010-11 company is having 0.43:1, which is lesser than the

standard ratio which is 1:1 and in 2011-12 and 2012-13 company is

96

Long term debts

Debt Equity ratio = ----------------------------

owner’s capital

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having greater debt equity ratio which is also not good for the

company because high debt equity ratio indicates that the claim of the

creditors are greater than those of owners

INTERPRETATION:-

Here the debt equity ratio consists of long term debt and owner’s

capital. A low debt equity ratio implies a greater claim of owners on

the assets of the company than the creditors and high debt equity ratio

indicates that the claims of the creditors are greater than those of

owners. Company should decrease their debt or pay their debt because

it’s not good for the company.

3. GROSS PROFIT RATIO:-

Gross profit ratio measures the relationship of gross profit to net sales

and is usually represented as a percentage.

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Formula:-

YEAR GROSS PROFIT SALES GROSS PROFIT RATIO (In %)

2010-2011 13782720.06 8,91,13,153.32 15.44

2011-2012 17191397.69 11,11,74,494.55 15.38

2012-2013 15759052.98 7,28,33,712 20.84

ANALYSIS:-

Here the company is having 15.44% gross profit in 2010-11, in 2011-

12 company is having 15.38% gross profit and 2012-13 company is

having 20.84% gross profit which is better than 2010-11 & 2011-12.

98

Gross profitGross profit ratio = ---------------------------- × 100

Net sales

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15.44%

15.38%

20.84%

Gross profit ratio

2010-112011-122012-13

INTERPRETATION:-

Gross profit ratio indicates the average margin on the goods sold. It

shows whether selling price is adequate or not. A low gross profit may

indicate a higher cost of production. A high gross profit ratio indicates

a lower cost and is a sign of good management. Here company is not

maintaining better profit margin.

4. NET PROFIT RATIO

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Meaning:-

This is the ratio of net profit to net sales. In calculating the net profit,

all non-operating expenses and losses are also deducted and all non-

operating income are added.

Formula:-

YEAR NET PROFIT NET SALES NET PROFIT

RATIO

(In %)

2010-2011 4931242.90 89113153.32 5.53

2011-2012 3694061.81 72833712 4.60

2012-2013 5114275.88 11174494.55 5.07

100

Net profitNet profit ratio = -------------------------- × 100

Net sales

SHREEJI ASIA

ANALYSIS:-

Here the company is having in 2010-11 5.53% net profit, in 2011-12 4.60% which is getting decreases in 2011-12 and 2012-13 company is having 5.07% net profit which is getting increases in 2012-13. This shows the company is not maintaining better net profit.

5.53%

4.60%

5.07%

NET PROFIT RATIO

2010-112011-122012-13

INTERPRETATION:-

The net profit ratio is over all measure of the firm’s ability to turn each rupee of sales into profit. It indicates the efficiency with which a business is managed. A firm with high net profit is an advantageous position to survive in the face of rising cost of production and falling selling prices. Thus company should improve their net profit ratio.

5. RETURN ON INVESTMENT

Meaning:-

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This is the most important test of profitability of business. It measures

the overall profitability. It is ascertained by comparing profit earned

and capital employed to earn it.

Formula:-

YEAR PROFIT BEFORE INTEREST & TAXES

(PBIT)

TOTAL CAPITAL EMPLOYED

RETURN ON INVESTMENT

(In %)

2010-2011 4931242.90 11147121.58 44.24

2011-2012 3694061.81 9906519.56 51.63

2012-2013 4931242.90 15228671.08 24.26

ANALYSIS:-

Here the company return on investment in 2010-11 is 44.24%, 2011-

12 is 51.63% which is increases by 44.24% to 51.63% but the ROI in

2012-13 is 24.26% which is lower than 2010-11 and 2011-12, which

is not good for the company.

102

Profit before interest & taxesReturn on investment = -------------------------------------------- × 100

Total capital employed

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44.24%

51.63%

24.26%

RETURN ON INVESTMENT

2010-112011-122012-13

INTERPRETATION:-

ROI is the only ratio which measures satisfactorily the overall

performance of the business from the point of view of profitability.

This ratio indicates how well the management has utilised the fund

supplied by owners and creditors. The higher ROI, the more efficient

the management is considered to be in using the fund available.

Company should maintain their ROI because it decreases in 2012-13,

which is not good for the company.

6. RETURN ON WORKING CAPITAL

Meaning:-

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Return on working capital is a method of increasing enterprise value

by maximizing efficiency of working capital. It measures return

within the business.

Formula:-

YEAR NET PROFIT WORKING CAPITAL

RETURN ON WORKING CAPITAL (In %)

2010-2011 4931242.90 2252695.83 218.90

2011-2012 3694061.81 20023416.86 25.54

2012-2013 5114275.88 38303135.08 9.64

ANALYSIS:-

Here the company is having 218.905 in 2011, 2012 is 25.54 which is

much lesser than 2010 and 2013 is 9.24 which also much lesser than

2011 & 2012. This shows the company is not maintaining return on

working capital.

104

Net profitReturn on working capital = -------------------------------

working capital

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218.90%

25.54%9.64%

RETURN ON WORKING CAPITAL

2010-112011-122012-13

INTERPRETATION:-

Return on capital (ROC), otherwise called invested capital (ROIC), is

one the most important ratios to measure profitability of a company. It

measures how much money a business or investment is able to

generate on the capital employed. Despite its importance, this ratio is

seldom reported and often needs to be calculated. Here is how to

determine this ratio from the balance sheet and income statement.

Company should maintain their return on working capital.

7. STOCK TURNOVER RATIO

Meaning:-

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This ratio is the relationship between the cost of goods sold during a

given period and the average amount of stock carried during the

period.

Formula:-

YEAR COST OF GOOD SOLD

AVERAGE STOCK STOCK TURNOVER RATIO

(In times)

2010-2011 75330433.26 11940990 6.30

2011-2012 55642314.31 17987593 3.10

2012-2013 95415441.57 38657428 2.47

ANALYSIS:-

106

Cost of goods soldStock turnover ratio = ------------------------------

Average stock

Cost of goods sold = Sales – Gross profit

Opening Stock + Closing stockAverage stock= ---------------------------------------------

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Here the stock turnover ratio in 2011 6.30 times, in 2012 company is

having 3.10 times and 2013 it is 2.47 times. There is continuous

decreasing in stock turnover ratio, which is not good for the company.

6.3

3.1

2.47

STOCK TURNOVER RATIO

2010-112011-122012-13

INTERPRETATION:-

Stock turnover ratio indicates the efficiency of a firm’s inventory

management. This ratio gives the rate at which stock are converted in

to cash. A low inventory turnover ratio is an indicator of dull business,

accumulation of inventory, over investment in inventory or

unreasonable goods etc. a high stock turnover ratio is considered

better as it indicates more sales. So company should maintain their

stock turnover ratio which keeps on decreasing. But too high and too

low ratio is also not good for the company.

8. DEBTORS TURNOVER RATIO

Meaning:-

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This ratio indicates the relationship between net credit sales and trade

debtors. It shows that the rate at which cash is generated by the

turnover of debtors.

Formula:-

YEAR SALES DEBTORS DEBTORS RURNOVER RATIO

(In times)

2010-2011 89113153.32 71295794.69 1.25

2011-2012 111174494.55 94254642.73 1.18

2012-2013 72833712 27065729.93 2.69

ANALYSIS:-

108

SalesDebtors Turnover Ratio = -----------------------------------

Debtors

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Here debtors turnover ratio is 1.25, 1.18 and 2.69 as on 2011, 2012

and 2013 respectively. It indicates that company is not maintaining

their ratio in a proper way. Only 2012-13 company is getting their

debtors quickly.

2010-11 2011-12 2012-130

0.5

1

1.5

2

2.5

3

1.25 1.18

2.69

DEBTORS TURNOVER RATIO

INTERPRETATION:-

This ratio lies in the fact that debtors constitute one of the important items of current assets and this ratio indicates the how many days average sales are tied up in the amount of debtors. A high debtors turnover ratio indicates that debt are being collected more quickly. Change in this ratio shows the change in the company’s credit policy or change in ability to collect from its debtors. The company should maintain their ratio.

9. FIXED ASSETS TURNOVER RATIO

Meaning:-

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This ratio indicates the efficiency with which the firm is utilising its

investments in fixed assets such as plant and machinery, land &

building etc.

Formula:-

YEAR SALES NET FIXED ASSETS

FIXED ASSETS TURNOVER RATIO

(In times)

2010-2011 89113153.32 8726208.10 10.21

2011-2012 111174494.55 7615004.10 14.60

2012-2013 72833712 8964257 8.12

ANALYSIS:-

The analysis shows that a fixed asset turnover ratio of the company in

the year 2011 is 10.21 and 2012 is 14.60. Table shows that the ratio is

decreases in the year 2012-12 by 8.12 when it compares to last year

by 14.60.

110

SalesFixed assets turnover ratio = --------------------------

Net fixed assets

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2010-11 2011-12 2012-130

2

4

6

8

10

12

14

16

10.21

14.6

8.12FIXED ASSETS TURNOVER RATIO

INTERPRETATION:-

Fixed assets turnover ratio provides very useful information for both

investors and management about whether or not company is becoming

more efficient in the use of its fixed assets by comparing its value

with its historical records or industry average. A high ratio indicates

efficient utilisation of fixed assets in generating sales and a low ratio

may signify that the firm has an excessive investment in fixed assets.

There is an appreciable increase in fixed assets in 2012 compare to

another year.

WORKING CAPITAL TURNOVER RATIO

Meaning:-

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This ratio indicates the efficiency or inefficiency in the utilisation of

working capital in making sales.

Formula:-

YEAR SALES NET WORKING CAPITAL

WORKING CAPITAL TURNOVER RATIO

(In times)

2010-2011 89113153.32 2252695.83 39.56

2011-2012 111174494.55 20023416.86 5.55

2012-2013 72833712 38303135.08 1.90

ANALYSIS:-

The analysis shows that working capital turnover ratio in the year

2010 is 39.56, 2012 is 5.55 and 2013 is 1.90. Table shows that the

ratio decreases in the year 2011 and 2012 when it compare to last year

2010.

112

SalesWorking capital turnover ratio = ---------------------------

Net working capital

Net working capital = current assets – current liabilities

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2010-11 2011-12 2012-130

5

10

15

20

25

30

35

40

45

39.56

5.55

1.9

WORKING CAPITAL TURNOVER RATIO

INTERPRETATION:-

A high working capital turnover ratio shows the efficient utilisation of

working capital in generating sales. A low ratio, on the other hand,

May indicates excess of net working capital. This ratio shows that the

working capital is efficiently utilised or not. Here the ratio keeps on

decreasing compare to year 2010.

10.CREDITORS TURNOVER RATIO

Meaning:-

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This ratio also known as payable turnover ratio measures the

relationship between credit purchases and average account payable.

Formula:-

YEAR PURCHASES CREDITORS CREDITORS TURNOVER RATIO(In times)

2010-2011 53439070.55 33112849.93 1.61

2011-2012 80201327.37 69015084.18 1.16

2012-2013 64264017.62 80058231.25 0.80

ANALYSIS:-

This analysis shows that creditors turnover ratio of the company in the

year 2011 is 1.61, 2012 is 1.16 and 2013 is 0.80. The table shows that

the creditors turnover ratio which keeps on decreasing.

114

PurchasesCreditors turnover ratio = --------------------------------------

creditors

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2010-11 2011-12 2012-130

0.2

0.4

0.6

0.8

1

1.2

1.4

1.6

1.81.61

1.16

0.8 CREDITORS TURNOVER RATIO

INTERPREATATION:-

Here the data shows that creditors turnover ratio in the year 2010-11, 2011-12 and 2012-13 is 1.61, 1.16 and 0.80, which keeps on decreasing. So it is good sign for the company because lower the creditors higher profit and lower debt for the company.

11.CAPITAL TURNOVER RATIO

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Meaning:-

This ratio shows the relationship between cost of sales (or sales) and

the total capital employed.

Formula:-

YEAR SALES TOTAL CAPITAL EMPLOYED

CAPITAL TURNOVER RATIO

(In times)

2010-2011 89113153.32 15910146.83 5.60

2011-2012 111174494.55 27637420.96 4.02

2012-2013 72833712 50961543.88 1.43

ANALYSIS:-

The table shows that capital turnover ratio of the company in the year

2011 is5.60, 2012 is 4.02 and 2013 is 1.43.b Table also shows that the

creditors turnover ratio is keeps on decreasing compares to lat two

year

116

SalesCapital turnover ratio = --------------------------------------

Total capital employed

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2010-11 2011-12 2012-130

1

2

3

4

5

6 5.6

4.02

1.43

CAPITAL TURNOVER RATIO

INTERPRETATION:-

This ratio shows the efficiency with which capital employed in a

business is used. A high capital turnover ratio indicates the greater

profit and a low capital turnover ratio is a sign of insufficient sales

and possibility of lower profit. Company should maintain their capital

turnover ratio.

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12.OPERATING COST RATIO

Meaning:-

Operating cost ratio indicates the relationship of various operating

expenses to net sales.

Formula:-

YEAR OPERATING EXPENSES

SALES

OPERATING COST RATIO

(In %)

2010-2011 8851477.16 89113153.32 9.93

2011-2012 12078121.81 111174494.55 10.86

2012-2013 12064991.17 72833712 16.57

ANALYSIS:-

Here the table shows that operating cost ratio of the company in the

118

Operating expensesoperating cost ratio = -------------------------------------- × 100

sales

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year 2011 is 9.93, 2012 is 10.86 and 2013 is 16.57. Table also shows

that operating cost ratio which keeps on increasing compares to last

two year.

2010-11 2011-12 2012-130

2

4

6

8

10

12

14

16

18

9.9310.86

16.57

OPERATING COST RATIO

INTERPRETATION:-

This is main important ratio that every company and organisation

calculate because it shows the company’s expense and profit. The

lower the ratio, the greater is profitability and the higher the ratio,

lower is the profitability. In this chart, graph is increasing every year

which is not good for the company because an expense of the

company keeps on increasing.

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FINDINGS:-

1:- The current ratio shows the short term financial position and

policy. The standard ratio that is 2:1. The ratio of the company is

lower than the standard ratio i.e. 1.17:1 only in 2010-11 only. After

that company is maintaining their good liquidity position in 2011-12

is 2.14:1 and 2012-13 is 2.10:1.

2:- The quick ratio shows the ability to meet its immediate financial

commitments. Quick ratio 1:1 is considered to represent a satisfactory

current financial position. Company is having their quick ratio in the

year 2010-11 is 0.42:1, 2011-12 is 0.67:1 and 2012-13 is 0.62:1. Here

the company quick ratio is not satisfactory because its less than the

standard ratio i.e. 1:1. This is due to fact that the company does not

have a quick assets sufficient to meet its quick liabilities and quick

liabilities gone up more in proportion to the quick assets. The

company need to work on this.

3:- The debt equity ratio of the company in the year 2010-11

is .0.42:1, 2011-12 is 1.79:1 and 2012-13 is 2.35:1 which is keep on

increasing. The debt equity ratio of the company in the year 2010-11

is good because it is lower than the capital. But the year 2011-12

company has debt more than the capital which is double and 2012-13

debt is also more than the capital it is not good sign for the company.

So company should maintain their debt equity ratio.

4:- the net profit of the company is also decline compares to last year.

Because in the year 2010-11 the ratio is 5.53%, 2011-12 is 4.06% and

2012-13 is 5.07% which got decreases because of company huge debt.

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So company should maintain their net profit otherwise company will

go in huge debt.

5:- the return on investment of the company is also decline in the year

2012-13 which is 24.26 compares to last year. So company should

maintain this ratio.

6:- The stock turnover ratio is also decreased because in the year

2010-11 the ratio is 6.30, 2011-12 is 3.10 and 2012-13 is 2.47 which

is also not good sign for the company. So company should increase

their

7:- Capital turnover ratio is also decreasing in the year 2011-12 and

2012-13 it is 4.02 & 1.43 when it compares to year 2010-11 the ratio

is 5.6. So it is not good sign for the company because high capital

turnover indicates high profit so company should maintain this ratio.

8:- The operating cost ratio of the company in the year 2010-11 is

9.93, 2011-12 is 10.86 and 2012-13 is 16.57 which are increasing so

company should maintain this because higher operating ratio lower

profitability and lower the ratio greater profitability.

9:- Working capital turnover ratio of the company in the year 2010-11

is 39.56, 2011-12 is 5.55 and 2012-13 is 1.90. This is decreasing

compare to last year. A high working capital ratio shows the efficient

utilisation of working capital in generating sales.

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CONCLUSIONS:-

1:- The proprietor does have clear mobilization of fund which can

take care of any liability at any period.

2:- The current assets and current liabilities is very favourable in

2011-12 and 2012-13 hence the company does not have any problem

in working capital requirements.

3:- The Company’s credit policy is normal seen by the business cycle.

4:- In all the profit generated by the company for the last 3 years and

also transaction of the company is very favourable which will result in

the company is improving financial growth.

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SUGGESTIONS:-

1:- The Company in order to diversify certainly requires some funding

from financial institutions.

2:- Though the company’s current ratio is favourable obtaining further

credit from creditors is possible for short term.

3:- The company’s debt equity ratio is not favourable company should

not obtain credit for long term from creditors. The debt equity ratio

should be improved by the company for more funds to the company.

4:- Company’s profitability position is very low so company should

increase their sales to get better profit.

5:- Company should improve their operating cost ratio for getting a

better profit.

6:- Company should utilise their working capital in proper way to

generate sales and profit.

7:- Capital turnover ratio shown downstage thus the company should

improve their capital turnover ratio.

8:- The company should concentrate more on advertising. By giving

advertising the people would be aware of the company’s existence

which in turn, would bring popularity, reliability and belief in peoples

mind.

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Shreeji interiors – 2010-11

Balance sheet as at 31st march 2011

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