capital structure analysis

CAPITAL STRUCTURE ANALYSIS

OF

KPTL

A project report

In partial fulfillment of the requirement of two year full time Post Graduate Programme in Management (PGPM) Program (2008-10)

INSTITUTE OF BUSINESS MANAGEMANT AND RESEARCH

IBMR Ahmedabad

BY: Jaymin D. BhavsarPGPM Ist Year

Acknowledgement

Through this acknowledgement, we express our sincere gratitude towards all those people who aided us in the preparation of this project report which has been a learning experience.

We would like to thank our director, Mr. R.K. BALYAN for giving us the best opportunity of this practical work experience.

We express our sincere thanks to Mr.Satvik Trivedi, Human Resource Manager, who led us through out the project report and gave us valuable suggestions and encouragement about the work.

Again we express our thanks to the account manager Mr. Shailesh Vyas who had given us remarkable information regarding financial position of KPTL throughout last 5 year.

We would like to thank our faculty member that they gave us a chance for working in such a big organization.

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Finally we would like to thank our Incredible parents, how they can be escaped, who have cooperated me directly and indirectly in one or other way.

INDEX

S.No Topic Pg.No

1. Board of Directors2. Executive summery3. Objectives

4. Vision statement

5. Research Methodology

6. Introduction Power based industry About KPTL Division Of company Projects and joint cventures Balance sheet of the company Profit and loss A/C of the company

7. Capital structure theory

Capital structure of KPTL

Ratio analysis

leverage

cost of equity

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8. Strengths of the company

9. Limitations

10. Recommendation and suggesstions

11. Bibliography

BOARD OF DIRECTORS EXECUTIVE

MANAGEMENT TEAM

Mr. Mofatraj P. Munot Mr. Kamal K. Jain Chairman President & CFOFounder, Promoter and Chairman of Kalpataru Group with over 44 years of experience in the Mr. Dinesh B. Patelfield of Real Estate and Property Development, President & CEOCivil Contracting & various industries. (Distribution Projects)

Mr. Mahendra G. Punatar Mr. N. Sai MohanVice Chairman (upto 30.01.2009) President & CEOIndependent Director (w.e.f. 01.06.2009) (Overseas Projects)MS (Structural Engineering) from University ofMichigan, USA with over 49 years of experience Mr. Gyan Prakashin transmission line towers. President & CEO

(Pipeline Project)Mr. K. V. ManiManaging Director (upto 31.05.2009)Additional Director (w.e.f. 01.06.2009) Mr. M. A. BaraiyaBachelor of Engineering and MBA. Has 44 years Head )-HRof experience in Transmission industry, mainlyConstruction, Project Management and Company SecretaryOverseas Marketing. Mr. Bajrang Ramdharani

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Mr. Pankaj Sachdeva AuditorsDy. Managing Director (upto 31.05.2009) M/s. Kishan M. Mehta & Co., AhmedabadManaging Director (w.e.f. 01.06.2009) M/s. Deloitte Haskins & Sells, AhmedabadB.E (Hons) degree in Electrical Engineeringand has over 25 years of Product Marketing Legal Advisorand Project Execution experience in Power M/s. Singhi & Co., AhmedabadSystems Sector.

Mr. Parag MunotPromoter DirectorMBA, Carnegie Mellon University, USA with 16years of experience, is responsible for the groupReal Estate and Property Development business.

Mr. Ajay Munot BankersExecutive Director (upto 31.03.2009) Indian BankChartered Accountant and Bachelor in General Oriental Bank of CommerceLaw with over 14 years of experience. Union Bank of India

State Bank of IndiaMr. Manish Mohnot EXIM BankExecutive Director ICICI Bank Ltd.

Chartered Accountant and an ICWA having a Citi Bank N.A.rich experience of 14 years in consulting in the BNP Paribas, Abu Dhabifield of Oil, Gas, Power and other sectors Commercial Bank of Kuwaitrelated to Infrastructure.

Mr. Sajjanraj MehtaIndependent DirectorChartered Accountant with over 34 years ofexperience. A consultant in the field of ForeignExchange, Taxation & Corporate Affairs andStrategy.

Mr. Vimal BhandariIndependent Director

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Chartered Accountant with an experience of morethan 24 years in Financial Services sector. He wasExecutive Director of IL&FS Ltd. Presently, he isCountry Manager - Aegon India.

Mr. Shitin DesaiIndependent DirectorExperience in excess of 28 years in FinancialServices sector. He is currently the Executive ViceChairman of DSP Merrill Lynch Ltd.

Mr. Narayan SeshadriIndependent DirectorChartered Accountant with an experience of27 years in the field of finance, account, tax andbusiness consulting. Presently, he is the Chairmanand CEO of Halcyon Resources andManagement Pvt. Ltd.

Mr. Imtiaz KangaPromoter Director(upto 30.01.2009)Chartered Accountant with 29 years of experience in various industries

EXECUTIVE SUMMARY

Kalpataru Power Transmission is one of World's leading companies in the

design, testing, fabrication, erection and construction of transmission lines and

substation structures on a turnkey basis across India and Overseas. As an EPC

contractor, our scope of work includes design, testing, fabrication, galvanizing of

towers and construction activities from survey, civil works/ foundation, erection to

stringing and commissioning of EHV lines, besides procurement of items such as

conductors, insulators, hardware accessories etc. We also participates in Substation

projects on a partnership basis.

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Located at Gandhinagar Gujarat, in Western India, Kalpataru Power Transmission

is a public listed company with a turnover of USD 385 Million (Rs. 19.1 Billion)

and annual production of 80,000 MTs till 2007-08.The company has a net worth

of over USD 200 Million and an order booking of over Rs 50 Billion (USD

1Billion). The company has also attained distinction of crossing the USD 800

Million (Rs. 40 Billion) market capitalization. On a combined basis (with JMC

Projects), the consolidated turnover has crossed Rs 32.8 Billion (USD 655

Million).

The study aims at determining profitability and liquidity by analyzing the financial

statements of the company. The analysis of the financial statement is a process of

evaluating the relationship between component parts of financial statement to

obtain a better understanding of the firm’s position performance.

The financial analysis includes horizontal (trend) as well as the vertical analysis.

Trend analysis involves a comparison of the percentage of a firm over a time, that

is present percentage is compared with past percentage for the same firm.

This study will help the stakeholders of the company to know about the finance of

the company.Above were the reasons why we have chosen to understand a project

with detailed analysis of KPTL.For that after collecting the appropriate information

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we have analyzed the financial statement having the analysis of the profit and loss

account, Balance Sheet and ratios.

Objectives :

Strategic assessment of the power industries as well as overall KPTL.

To understand the financial soundness of the company.

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To know how company increases the productivity as well as profitability with the help of employees as an asset.

Mission

The Kalpataru Group's credo of "No Compromise" embodies strong commitment to highest standards of excellence and ethics. It encourages innovation and people development, which in turn lead to superior quality products and services and result in maximum customer satisfaction.

RESEARCH METHODOLOGY

Study objectives :-

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a) To study the nature of working capital, concepts and definition of working capital.

b) To examine the effectiveness of working capital management practices of the

firm.

c) To find out how adequacy or otherwise of working capital affects commercial

operations of the company.

d) To prescribe remedial measures to encounter the problems faced by the firm.

e) To study the working capital financing or means of financing of the company.

Scope of the study :-

f) Planning of working capital management

g) Working capital finance

Methods of Data collection :-

a) Primary data:

Basic information collected from the local sources as well as from the company

staff like managers, accountants and officers. Moreover information gathered

through practically preparing the data for working capital.

b) Secondary data:

1. From the B/S of the company

2. From CMA proposal report

3. From internet

4. From books

IntroductionIBMR Ahmedabad

Overview of power industry

.Kalpataru Power has two large Fabrication Plants with an annual installed capacity

of 108,000 MTs (with a capacity addition of 24,000 MTs in Oct, 2008) one of the

largest in the world and is equipped with modern machineries (including 16 CNC

machines) and automated temperature controlled Galvanising Baths, besides its

own state-of-the-art Testing Station and R & D Centre. It was the first company in

1994 in the Indian transmission industry to be ISO 9001 certified.

About 650,000+ MTs of towers and substation structures have already been

designed, manufactured and supplied over the last few years of which over

175,000 MTs has been exported. Over 250 Tower Tests of 132-500KV have been

carried out successfully, including 125 nos. at our own Testing Station, which is

one of the largest facilities of its kind in the world.

Their Construction division has completed over 8,000+ kms of turnkey projects in

India for various clients such as the Power Grid Corporation of India and various

State Electricity Boards (SEBs) of Gujarat, Karnataka, Maharashtra, Rajasthan,

Andhra Pradesh, Rajasthan, Orissa, Tamil Nadu and Madhya Pradesh.

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INFRASTRUCTURE

Kalpataru Power Transmission has 2 fabrication units and the production capacity

of these plants is around 108,000 MT per year. KPTL has one Plant for a Domestic

requirement which is situated in Sector 28 Gandhinagar, which has a capacity of

78,000 MTs per annum. And second plant is situated in Sector 25, Gandhinagar

which is 100% EOU plant for Export purpose and has capacity of 30000 MTs per

annum. The average capacity utilisation Rate is around 96 % of total Capacity

Installed.

The facilities available in these plants are

CNC punching / drilling machines (16 No from Ficep, Italy), Capable of

handling Angle sections upto 250*250*35 mm and Plates

Automatic temperature controlled galvanizing bath Capable of coating

requirement of 610 and 910 gms per sq.mts (80 to 130 micron)

Tower Testing Station and R&D Centre for testing upto 800KV D/C towers

with Tower Base width - 27M x 27M (square and rectangle), Height - 85mts

and uplift capacity per leg of 500 MT is one of the largest facility of its kind

in the world.

Over 12 nos. of Tension Stringing equipments upto 8/16 Tones (capable of

pulling quadruple conductors)

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DIVISION OF COMPANY

Tower Design, Testing and Manufacturing

The key strength of any Transmission Line player lies in its core capability of design, testing, manufacturing and construction.

The company employs latest 3D Design Software and their Engineering Team has perfected the art to deliver cost effective design solutions. Their state of art Tower Testing Station and R & D center can handle up to 800 KV D/C towers with base width of 27 Mtrs * 27 Mtrs and height of 80 Mtrs. They have successfully completed their 100th Tower Tests.

Their Fabrication plant with an annual installed capacity of 54000 MTs has been running at 90 % of its capacity to deliver up to 4000 MT’s per month for over 36 months. Besides delivering towers to their own projects, they have been reliable supplier of choice to reputed EPC Contractors like ABB, Areva, Sumitomo, Downer, Gridcom etc with exports to 15 countries. They are the first Indian manufacturing unit to achieve the ISO 9001 Certification since 1994.

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They are further expanding capacity by another 18000 MT’s to exclusively cater to their export requirements and to retain their position as one of the largest tower fabricators across the world.

Civil Construction (JMC Projects)

JMC projects (India) Ltd. is one of the leading civil contracting company and is a preferred name when it comes to industrial Structures, factories, Commercial Buildings, InfoTech / Software parks. Besides this, it has done civil works for various Power Plants, Sub-stations, Sugar, Pharma and Automobile Factories.

Some of its valued customers include Bajaj Auto, Coca Cola, Asian Paints, Power Grid, Infosys, Wipro, IIM Ahmadabad and many more.

The company has revenues of approx Rs.2.4 Billion (USD 55 Million) and a manpower strength of over 875 people, besides a fleet of plant & equipment.

JMC’s edge has been its quality and commitment to timely execution. It has also entered into construction of Express Ways, Roads & Bridges.

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Kalpataru Power has become a dominant shareholder in JMC since February 2005 and is committed to take JMC to greater height of success.

Transmission & Distribution Division

Following measures taken by the Company from time to time. Has helped us

maintaining energy consumption at optimum level:

1. Use of Voltage Stabilizer to regulate fluctuations in voltage of the Ahmadabad

Electricity Company supply, which helps to reduce energy consumption and

eliminates wastage.

2. Installed enough number of Capacitors at Electrical Control Panel Boards to

improve the overall power factor.

3. Took PNG Connection, an environment friendly fuel, for galvanizing plant and

hot bending machine to conserve the energy.

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Total energy cost is less than 1% total turnover, which reflects success of the

company's efforts in this direction.

Bio-mass Energy Division

1. The company has diversified into Power Generation using renewable/non

conventional energy sources such as agricultural waste and crop residues

(biomass) in the State of Rajasthan.

2. The plants uses biomass (mustard crop residue / cotton sticks) and has

established infrastructure / logistics enabling it to collect over 75,000 MTs last

year. Based on first hand experience and holding of buffer stocks, the company

foresees no biomass collection risks in Ganganagar.

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3 Distribution companies of Jaipur, Jodhpur & Ajmer based on the Rajasthan State

Policy of Non-Conventional energy. Third party sale to Large Industrial Customer

is also permitted as per existing Policy & Regulatory guidelines. The Plant sale

will be approx. 90 million units/kwh in 2007-08 to the Rajasthan Grid with timely

payments.

Besides being environment friendly, the Project is expected to contribute to the

prosperity and sustainable development of the region, besides generating local

employment opportunities.

Oil and Gas Pipeline Sector

After the Oil & Gas sector has been opened up in India, and the demand of energy

per capita has been rising steadily with the growth in economy, the demand of

Pipelines for natural gas and petroleum products in India has been witnessing a

spurt. The phenomenon has been replicated in many parts of world and as a result,

more and more pipelines are being set up in various parts of the world to facilitate

transport connectivity between farthest point to the source.

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Natural gas has emerged as the dominant source of additional energy in world.

There exists a huge deficit of natural gas based on current production and demand

data in India.

According to GAIL (India) Limited, the nodal agency for transportation of natural

gas, the demand for natural gas is increasing @12% per annum. Pipeline transports

only 25% of petroleum product consumed by Indian industry in spite of being

cheaper than Railways and Road transportation. It is estimated that total pipeline

network would increase from the present 16,000 km to 40,000 km in the next 3-4

years, total Capital Expenditure required for Oil & Gas Network is estimated

around USD 10 billion.

Logistics & Warehousing Business

According to industry estimates, storage capacity in the country vis-a-vis

production of vegetables and fruits stands at a meager 12% compared with the

international average of 50%. The result: nearly 38% of the perishable goods, such

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as vegetables and fruits, are lost owing to lack of cold storage systems and

processing facilities. The cumulative loss could be to the tune of Rs. 55,000 crore.

Shree Shubham Logistics Limited (SSLL),a subsidiary of Kalpataru Power

Transmission Limited is focused in developing Commodity Warehousing Logistics

parks in strategic locations in the country.

The key objective is to develop multi-function facilities catering to ambient

temperature warehousing, cold storage, processing units, auction yard, weigh

bridges and other support amenities. By July, 2009, SSLL will have storage

capacity of over 1,80,000 MTs as most of its planned warehouses will be

operational by that time.

REAL ESTATE DIVISION

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Company is looking for certain real estate initiatives directly or indirectly through

SPV or Subsidiaries to build up developers capabilities to bid for BOOT/BOOM

infrastructure projects in future. The Company has identified two developmental

projects for execution under its subsidiaries.

One of its wholly owned subsidiary Energy Link (India) Ltd., development of

multi product SEZ is proposed over an area of approximately 1,000 hectors (2,600

Acres) in the region called 'Ahmedabad-Dholera Special Investment Region' (SIR),

which is about 85 kms away from Ahmedabad.

The other project is through wholly owned subsidiary namely Amber Real Estate

Ltd. to develop IT Park which is proposed to be developed at Mumbai.

KPTL is associated with And Different Projects of KPTL

Established over 3 decades ago in 1969 by Mr. Mofatraj P. Munot, a first generation entrepreneur. The Group employs over 4,000 people. Kalpataru borrows its name from the ancient Indian mythological tree - the Kalpa-Vruksha -beneath which all wishes are fulfilled.

Kalpataru Ltd.Property Solutions (I) Pvt Ltd. (PSIPL)

JMC Projects (India) Ltd. Caprihans India LimitedShree Shubham Logistics Ltd.

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1. Kalpataru Ltd.

The group's flagship company, Kalpataru Ltd. is a leading real estate developer with premium residential and commercial complexes in Mumbai and Pune.

Pioneering the concept of creating lifestyle living, it has built more than 75 landmark edifices in the last 39 years. With a team of 1,000 dedicated, Kalpataru has created an uncomparable brand and reputation for itself in the Property Development and Real Estate industry.

We pride at being one of the largest Property Groups in India, with development of over 1.5 Million sq.ft at any point of time.

Every Kalpataru project reflects a "no compromise" attitude; one that manifests in the architecture, engineering and construction of every project; from towering structures to expansive complexes, Kalpataru has proven its commitment and expertise in every segment of property development.

The residential complexes are replete with landscaped gardens, swimming pools, gymnasium, ennis and squash courts, clubhouses and several innovative amenities.

In an age where architecture is mainly utilitarian, Kalpataru endeavours to combine the functional with the aesthetic and maintains the highest standards of quality right down to the last detail.

2. JMC Projects (India) Ltd.

We have forged a strategic alliance with JMC Projects (India) Ltd by acquiring controlling equity stake (51%+) in Feb, 2005.JMC Projects is one of the leading Civil Contractors in the field of Construction. Commercial / Residential Buildings, Software parks, Industrial structures / Factories, Infrastructure projects like Roads, Bridges, Underpass, Metro Stations etc. It employs over 2,400 people and has a fleet of Plant & Machinery.Its revenue for the period ended March, 2008 was in excess of Rs 9 Billion (USD 225 Million) and likely to cross Rs. 13.5 Bn (USD 337 Mn) in 2008-09.JMC is one of the successful turnaround & growth stories in the civil engineering sector (from Rs. 1.80 Bn to Rs 13.5 Bn in only 4 years) and is poised to become one of the fastest growing

IBMR Ahmedabad

small cap companies of India.

3.Shree Shubham Logistics Ltd.

Shree Shubham Logistics Limited was incorporated in January, 2007, and subsequently converted into a Public Limited company in April, 2007.SSLL is a subsidiary of Kalpataru Power Transmission Limited (KPTL). KPTL holds around 80% stake in the company.SSLL is created to serve the needs of Agri and Non-Agri Commodity Storage in best practice ambient and temperature-controlled warehouses across major markets in North, South and West India.The main objectives of SSLL is to offer end-to-end logistics solutions with a pan-India presence, to all the commodity stake holders in the agricultural and non-agricultural segment including, but not limited to warehousing, cold storage services, and third party logistics (3PL), across the country.SSLL plans to develop over 41 Global Standards Agri-Logistics Parks at strategic Mandies located in 11 states within a span of three years. In the first phase of operations, SSLL has commenced construction of 11 Agri Logistics Parks which include 3 Cold Stores, creating a capacity of about 200,000 Metric Tons for Dry storage and over 32,000 Metric Tons for Cold Storage.

4.Property Solutions (I) Pvt Ltd. (PSIPL)

PSIPL is one of India 's premiere Integrated Facility Management companies and has recently forayed into Project Management Services, founded in 1999, as a business division of the renowned Kalpataru Group of Companies, PSIPL currently manages over 18 million square feet of property in Mumbai, Pune, Baroda, Hyderabad, Bangalore, Chennai & Delhi.Service Expansion Programs, Quality Assurance Standards, Focused Recruitment and most

important of all Customer Satisfaction are aspects that make PSIPL a leader in the field of Integrated Facility and

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Project Management Service in India.PSIPL is dedicated to managing all projects to international standards and is backed by a strong inhouse team of Professionals. Each of the properties managed by PSIPL is serviced and administered by technically qualified personnel.With dedicated and well-trained team of people,strong knowledge base and documented systems and processes, PSIPL is committed to adhering to a policyof quality, safety and continuous improvement, offering you a flexible range of servicesas an integral part of your business, enabling you to concentrate on your core business.

JOINT VENTURE :

1.Caprihans India Limited

Caprihans India Limited is a Joint venture between the Kalpataru Group and EVC International N.V.Caprihans is a Public Limited Company with shares listed on Mumbai and Delhi Stock Exchanges.As on date, the USD 1 Billion EVC Group holds 51% of the equity while the Kalpataru Groupowns 22%, balance being held by the Public. The EVC Group is the largest PVC Polymer producer and the 2nd largest PVC Films producer in Europe. Caprihans is the market leader in the field of Flexible and Clear PVC films and sheeting, Pharma and Thermoforming grade Rigid PVC Films (Blister) and Extruded hollow corrugated PP sheets with an all-India network of offices, depots and dealers. The company employs over 400 people and a turnover of approx. Rs.1.20 Billion (USD 26 Million) in 2003.

The Company has two manufacturing facilities located at Thane and Nashik (Maharashtra) and operates 4 calendars and 3 sheet-line extruders of capacity 20,000 MTs per annum and 3,000 MTs per annum respectively. Shareholding Pattern As on 31 st March, 2010

Sr. No. Category No. of Shares held

% to the Shareholding

A Promoter & Promoter Group Share Holding :

Indian 16,876,266 63.68

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Foreign - -

B Public Share Holding :

1. Institutional :

Mutual Funds & UTI 3,457,372 13.05

Banks, Financial Inst. 53,577 0.20

Venture Capital Fund 1,514,000 5.71

Insurance Companies 642,473 2.42

FIIs 1,760,304 6.64

2. Non-Institutional :

Private Corporate Bodies 679,955 2.57

NRIs / OCBs 155,071 0.59

Indian Public 1,260,984 4.76

Clearing Members 99,998 0.38

TOTAL 26,500,000 100.00

No. of Shares of Rs.10 eachShareholders Share in Amount

Number % of Total In Rs. % of Total

Upto - 500 14,525 96.33 8,762,830 3.31

501 - 1,000 268 1.78 1,993,220 0.75

1,001 - 2,000 106 0.70 1,530,080 0.58

2,001 - 3,000 39 0.26 977,990 0.37

3,001 - 4,000 17 0.11 611,660 0.23

4,001 - 5,000 9 0.06 423,160 0.16

5,001 - 10,000 23 0.15 1,716,140 0.64

10,001 and above 91 0.61 248,984,920 93.96

Total 12,700 100.00 265,000,000 100.00

Rajiv Gandhi Grameen Vidyutikaran Yojana

Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) was launched in April-05

by merging all ongoing schemes. Under the programmed 90% grant is provided by

Govt. of India and 10% as loan by REC to the State Governments. REC is the

nodal agency for the programme. The RGGVY aims at:

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Electrifying all villages and habitations as per new definition

Providing access to electricity to all rural households

Providing electricity Connection to Below Poverty Line (BPL) families free

of charge

Infrastructure under RGGVY :

Rural Electricity Distribution Backbone (REDB) with 33/11 KV (or 66/11

KV) sub-station of adequate capacity in blocks where these do not exist.

Village Electrification Infrastructure (VEI) with provision of distribution

transformer of appropriate capacity in villages/habitations.

Decentralized Distributed Generation (DDG) Systems based on conventional

& non conventional energy sources where grid supply is not feasible or cost-

effective.

SIZE

India has the fifth largest electricity generation capacity in the world

Low per capita consumption at 631 units; less than half of China

Transmission & Distribution network of 6.6 million circuit km - the third

largest in the world

STRUCTURE

Majority of Generation, Transmission and Distribution capacities are with

either public sector companies or with State Electricity Boards (SEBs)

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Private sector participation is increasing especially in Generation and

Distribution.

Distribution licences for several cities are already with the private sector

Three large ultra-mega power projects of 4000MW each have been recently

awarded to the private sector on the basis of global tenders.

POLICY

100% FDI permitted in Generation, Transmission & Distribution - the

Government is keen to draw private investment into the sector

Policy framework: Electricity Act 2003 and National Electricity Policy 2005

Incentives: Income tax holiday for a block of 10 years in the first 15 years of

operation; waiver of capital goods' import duties on mega power projects

(above 1,000 MW generation capacity)

Independent Regulators: Central Electricity Regulatory Commission for

central PSUs and inter-state issues. Each state has its own Electricity

Regulatory Commission

OUTLOOK

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Over 78,000 MW of new generation capacity is planned in the next five

years

A corresponding investment is required in Transmission and Distribution

networks

Power costs need to be reduced from the current high of 8-10 cents/unit by a

combination of lower AT & C losses, increased generation efficiencies and

added low-cost generating capacity

POTENTIAL

Large demand-supply gap: All India average energy shortfall of 9% and

peak demand shortfall of 14%

The implementation of key reforms is likely to foster growth in all segments

Unbundling of vertically integrated SEBs

“Open Access” to Transmission and Distribution networks

Select distribution circles to be franchised/privatised

Tariff reforms by regulatory authorities

Opportunities in Generation for:

Ultra Mega Power Plants (UMPP) – 9 projects of 4000 MW each

Coal based plants at pithead or coastal locations (imported coal)

Natural Gas/CNG-based turbines at load centres or near gas terminals

Hydel power potential of 150,000 MW is untapped as assessed by the

Government of India.

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GLOBAL LEVEL OF THE COMPANY

With a strong thrust on Overseas markets, the Company is/has already exported Towers or is executing/has completed Turnkey projects in :

AsiaPhilippinesMalaysiaVietnamIndonesiaThailand

BangladeshNepal

Middle EastKuwaitUAEQatarSyria

TurkeyIraq

AfricaAlgeriaEthopiaZambiaNigeriaKenya

TanzaniaMozambique

DjiboutiUganda

South Africa

AmericaUSA

CanadaMexico

Peru

AustraliaTasmania

Transmission Line Experience

Total supplies Over 6,00,000 MTs

Total physical exports Over 2,00,000 MTs

Tested Over 250 Towers (including over 125 at own Testing Station)

Construction of lines

Total lines from 130kv to 765KV HVDC over 8,000 kms

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BALANCE SHEET OF KPTL

Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05

Sources of funds

Owner's fund

Equity share capital 26.5 26.5 26.5 10.86 10.86

Share application money - - - - -

Preference share capital - - - - -

Reserves & surplus 810.45 740.72 615.34 156.43 102.25

Loan funds

Secured loans 485.44 295.85 336.71 232.78 100.48

Unsecured loans 169.27 30 - - 10

Total 1,491.66 1,093.07 978.55 400.07 223.59

Uses of funds

Fixed assets

Gross block 359.09 295.97 256.75 159.38 97.66

Less : revaluation reserve - 0.55 0.6 0.64 0.69

Less : accumulated depreciation 100.69 73.29 51.71 35.36 27.09

Net block 258.4 222.13 204.45 123.38 69.88

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Capital work-in-progress 10 1.93 4.12 28.36 0.21

Investments 126.83 147.51 218.92 29.45 10.13

Net current assets

Current assets, loans & advances 1,925.71 1,332.47 1,084.76 600.87 343.41

Less : current liabilities & provisions 829.27 610.98 533.75 382.08 200.19

Total net current assets 1,096.44 721.49 551.01 218.79 143.22

Miscellaneous expenses not written - - 0.05 0.1 0.15

Total 1,491.66 1,093.07 978.55 400.07 223.59

Notes:

Book value of unquoted investments 53.26 74.79 146.45 - -

Market value of quoted investments 58.48 276.3 179.15 147.3 20.28

Contingent liabilities 107.63 55.59 29.44 48.34 36.44

Number of equity shares outstanding (Lacs) 265 265 265 108.62 108.62

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PROFIT AND LOSS A/COF KPTL

Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05

Income:

Operating income 1,882.50 1,737.58 1,524.36 839.72 541.32

Expenses

Material consumed 1,026.03 988.94 864.21 522.71 347.3

Manufacturing expenses 414.15 260.45 201.53 87.49 72.34

Personnel expenses 108.62 90.58 71.61 38.9 23.63

Selling expenses - 21.24 22.07 9.49 4.4

Adminstrative expenses 110.97 86.3 65.67 38 22.62

Expenses capitalized - - - - -

Cost of sales 1,659.76 1,447.52 1,225.09 696.59 470.29

Operating profit 222.73 290.06 299.27 143.13 71.04

Other recurring income 30.76 16.05 10.66 1.64 1.04

Adjusted PBDIT 253.49 306.11 309.93 144.77 72.08

Financial expenses 105.59 56 64.83 40.5 22.43

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Depreciation 27.32 21.8 16.76 8.79 5.5

Other write offs - 0.05 0.05 0.07 0.11

Adjusted PBT 120.58 228.26 228.28 95.41 44.04

Tax charges 26.17 82.36 70.84 32.52 16.26

Adjusted PAT 94.41 145.90 157.44 62.89 27.78

Non recurring items - 1.88 1.83 1.77 -0.8

Other non cash adjustments -0.15 2.1 -1.18 1.78 1.65

Reported net profit 94.26 149.88 158.09 66.45 28.63

Earnigs before appropriation 414.18 363.17 256.54 117.89 60.58

Equity dividend 19.88 19.88 19.88 10.86 5.43

Preference dividend - - - - -

Dividend tax 3.38 3.38 3.38 1.58 0.71

Retained earnings 390.93 339.92 233.29 105.45 54.44

IBMR Ahmedabad

TREND ANALYSIS OF BALANCE SHEET

Chart (A) Sources of Funds

Chart (B) Fixed Assets & Investment

IBMR Ahmedabad

2009-08 2008-07 2007-060

500

1000

Share capital

Reserves

Secured loans

Unsecured loans

Series5

Year

Rs

.(In

Cro

res

)

0

100

200

300

400

500

600

700

2009-08 2008-07 2007-06

Year

% T

rend

Gross Block

Depriciation

Net Block

Capital Work In Progress

Investment

CAPITAL STRUCTURE

In finance, capital structure refers to the way a corporation finances its assets

through some combination of equity, debt, or hybrid securities. A firm's capital

structure is then the composition or 'structure' of its liabilities. For example, a firm

that sells $20 billion in equity and $80 billion in debt is said to be 20% equity-

financed and 80% debt-financed. The firm's ratio of debt to total financing, 80% in

this example, is referred to as the firm's leverage. In reality, capital structure may

be highly complex and include tens of sources. Gearing Ratio is the proportion of

the capital employed of the firm which come from outside of the business finance,

e.g. by taking a long term loan etc.

A mix of a company's long-term debt, specific short-term debt, common equity

and preferred equity. The capital structure is how a firm finances its overall

IBMR Ahmedabad

2009-08 2008-07 2007-060

100

200

300

400

500

600

700

Gross Block

Depriciation

Net Block


Investment

Year

% T

ren

d

2009-08 2008-07 2007-060

100

200

300

400

500

600

700

Gross Block

Depriciation

Net Block


Investment

Year

% T

ren

d

0

100

200

300

400

500

600

700

2009-08 2008-07 2007-06

Year

% T

rend

Gross Block

Depriciation

Net Block


Investment

2009-08 2008-07 2007-060

100

200

300

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Gross Block

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Net Block


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% T

ren

d

operations and growth by using different sources of funds.

Debt comes in the form of bond issues or long-term notes payable, while equity is

classified as common stock, preferred stock or retained earnings. Short-term debt

such as working capital requirements is also considered to be part of the capital

structure.

A company's proportion of short and long-term debt is considered when analyzing

capital structure.

DEFINITION

The permanent long-term financing of a company, including long-term debt,

common stock and preferred stock, and retained earnings. It differs from financial

structure, which includes short-term debt and accounts payable.

The capital structure of a company is the particular combination of debt, equity and

other sources of finance that it uses to fund its long term financing.

The key division in capital structure is between debt and equity. The proportion of

debt funding is measured by gearing.

IBMR Ahmedabad

This simple division is somewhat complicated by the existence of other types of

capital that blur the lines between debt and equity, as they are hybrids of the two.

Preference shares are legally shares, but have a fixed return that makes them closer

to debt than equity in their economic effect. Convertible debt may be likely to

become equity in the future.

Considering the division between debt and equity is sufficient to understand the

issues involved.

Simple financial theory models show that capital structure does not affect the total

value (debt + equity) of a company. It is, nonetheless, an important result, know as

capital structure irrelevance.

IBMR Ahmedabad

Contents

1 Capital structure in a perfect market

2 Capital structure in the real world

2.1 Trade-off theory

2.2 Pecking order theory

2.3 Agency Costs

2.4 Other

3 Arbitrage

IBMR Ahmedabad

1.Capital structure in a perfect market

Assume a perfect capital market (no transaction or bankruptcy costs; perfect

information); firms and individuals can borrow at the same interest rate; no taxes;

and investment decisions aren't affected by financing decisions. Modigliani and

Miller made two findings under these conditions. Their first 'proposition' was that

the value of a company is independent of its capital structure. Their second

IBMR Ahmedabad

'proposition' stated that the cost of equity for a leveraged firm is equal to the cost of

equity for an unleveraged firm, plus an added premium for financial risk. That is,

as leverage increases, while the burden of individual risks is shifted between

different investor classes, total risk is conserved and hence no extra value created.

Their analysis was extended to include the effect of taxes and risky debt. Under a

classical tax system, the tax deductibility of interest makes debt financing valuable;

that is, the cost of capital decreases as the proportion of debt in the capital structure

increases. The optimal structure, then would be to have virtually no equity at all.

2. Capital structure in the real world

If capital structure is irrelevant in a perfect market, then imperfections which exist

in the real world must be the cause of its relevance. The theories below try to

address some of these imperfections, by relaxing assumptions made in the M&M

model.

2.1 Trade-off theory

Trade-off theory allows the bankruptcy cost to exist. It states that there is an

advantage to financing with debt (namely, the tax benefit of debts) and that there is

a cost of financing with debt (the bankruptcy costs of debt). The marginal benefit

of further increases in debt declines as debt increases, while the marginal cost

increases, so that a firm that is optimizing its overall value will focus on this trade-

off when choosing how much debt and equity to use for financing. Empirically,

IBMR Ahmedabad

this theory may explain differences in D/E ratios between industries, but it doesn't

explain differences within the same industry.

2.2 Agency Costs

There are three types of agency costs which can help explain the relevance of

capital structure.

Asset substitution effect: As D/E increases, management has an increased

incentive to undertake risky (even negative NPV) projects. This is because if

the project is successful, share holders get all the upside, whereas if it is

unsuccessful, debt holders get all the downside. If the projects are

undertaken, there is a chance of firm value decreasing and a wealth transfer

from debt holders to share holders.

Underinvestment problem: If debt is risky (eg in a growth company), the

gain from the project will accrue to debt holders rather than shareholders.

Thus, management has an incentive to reject positive NPV projects, even

though they have the potential to increase firm value.

Free cash flow: unless free cash flow is given back to investors,

IBMR Ahmedabad

management has an incentive to destroy firm value through empire building

and perks etc. Increasing leverage imposes financial discipline on

management.

3. Arbitrage

Similar questions are also the concern of a variety of speculator known as a

capital-structure arbitrageur, see arbitrage.

A capital-structure arbitrageur seeks opportunities created by differential pricing of

various instruments issued by one corporation. Consider, for example, traditional

bonds and convertible bonds. The latter are bonds that are, under contracted-for

conditions, convertible into shares of equity.

The stock-option component of a convertible bond has a calculable value in itself.

The value of the whole instrument should be the value of the traditional bonds plus

the extra value of the option feature. If the spread, the difference between the

convertible and the non-convertible bonds grows excessively, then the capital-

structure arbitrageur will bet that it will converge.

Capital structure (in crore)

From Year To Year

Class Of Share

Authorized Capital

Issued Capital

Paid Up Shares (Nos)

Paid Up Face Value

Paid Up

Capital

2007 2008 Equity Share 30 26.5 2650000 10 26.5

IBMR Ahmedabad

0

2006 2007 Equity Share 30 26.52650000

0 10 26.5

2005 2006 Equity Share 30 10.861086150

0 10 10.86

2004 2005 Equity Share 20 10.861086150

0 10 10.86

2003 2004 Equity Share 20 10.861086150

0 10 10.86

5.2 CAPITAL STRUCTURE OF KPTL

5.3 DIVIDEND

Year Month Dividend (%)

2009 Jun 75

IBMR Ahmedabad

2008 May 75

2007 May 75

2006 May 50

2005 May 50

2004 May 30

2003 May 15

2002 Jul 15

2001 Aug 15

2000 Jun 5

2000 Mar 25

1999 May 30

1998 May 30

1997 May 30

OBJECTIVE

IBMR Ahmedabad

To calculate Weighted Average Cost of Capital (WACC)

To calculate Return on Investment(ROI)

Compare WACC and ROI.

If ROI is greater than WACC, then the company is getting returns more than the capital employed. Vice Versa.

IBMR Ahmedabad

RATIO REQUIRED FOR CAPITAL STRUCTURE

Ratios:

Finance structure ratio indicates the relative mix or blending of owner’s fund

and outsider’s debt funds in the total capital employed in the business. It should

be noted that equity funds are the prime fund, which increases progressively

through reinvestment of profits, while outside debt funds are supplementary

funds and are added at the discretion of the management. We also use some

liquidity ratio,and profitability ratio for calculation. Some popular ratios are as

under...

1 .Equity Ratios

2 .Debt Ratios

3 .Debt-Equity Ratios

4 .Debt service coverage ratio

5. Interest coverage ratio

6. Current ratio

7. Net working capital ratio

8. Return on equity

IBMR Ahmedabad

1. Equity Ratios

Equity Ratio = Net Worth

Total Capital Employed

1) 2008-09 = 836.95

971.08

= 0.86

2) 2007-08 = 767.77

838.16

= 0.91

Where,

Net Worth = Equity Capital + Reserves – Misc. Expenses.

Total Capital Employed = Net Worth + Long Term Debts.

IBMR Ahmedabad

Chart : Equity Ratios

2008-09 2007-08

RATIO 0.860000000000001 0.91

0.835

0.845

0.855

0.865

0.875

0.885

0.895

0.905

RATIO

Axis Title

Analysis:

This ratio suggests the proportion of the Net Worth to total capital

employed. Net Worth to Total Capital Employed. Net Worth is share plus

reserves and surplus. The higher the ratio the higher the net worth in total

capital employed and vice versa.

IBMR Ahmedabad

The ratio decreased from the last year because the long term debt is

increase.

It was the highest value is 0.91 in the year 2007-08.

3. Debt Equity Ratio:

When debt funds are used to generate ROI greater than interest cost on debt, the equity earning is enhanced, but if the interest cost is higher than the ROI, adversely affect the earning owners. This ratio is popularly described as Debt-Equity Ratio. Higher debt – equity ratio is (1) good if ROI is greater than interest on debt. Thus, use of debt (or leverage) is considered as a “Double Aged” weapon.

Debt Equity Ratio = Total Long term Debt

Net Worth

2008-09 = 134.13

836.95

= 0.16

2007-08 = 70.38

767.77

IBMR Ahmedabad

= 0.09

Chart : Debt Equity Ratios

2008-09 2007-08

RATIO 0.16 0.09

0.010.030.050.070.090.110.130.15

RATIO

Axis Title

Analysis:

Debt Equity Ratio is debt to Equity. Debt means long term fund having

maturity of five years or more including interest thereon.

Equity is paid up share capital plus free reserves. The higher the debt fund

used in capital structure, the greater is the financial risk. This is also known

as leverage ratio.

IBMR Ahmedabad

Here as per the graph, we can see that the value is decreasing regularly.

IBMR Ahmedabad

4 .Debt service coverage ratios:

Financial institutions which provide the bulk of long-term debt finance judge the

debt capacity of a firm in terms of its DSCR.

DSCR= PBTi+DEPi+INTi+li

INTi+LRIi

Where,

PAT= PROFIT AFTER TAX

DEP=DEPRECIATION FOR THE YEAR

INT=INTEREST ON THE LONG TERM LOAN

LRI=LOAN REPAYMENT INSTALLEMENT

Li=LEASE RENTAL YEAR

N=period of the loan

2008-09 (IN CRORE) = 155

24

= 6.46

2007-08(IN CRORE) = 231

24.26

IBMR Ahmedabad

= 9.52

Chart : Debt service coverage ratios

2008-09 2007-08

RATIO 6.46 9.52

0.51.52.53.54.55.56.57.58.59.5

RATIO

Axis Title

Analysis:

The DSCR is good for the company as because it decrease from the last year. And company has no problem if it would go for debt financing

IBMR Ahmedabad

5. INTEREST COVERAGE RATIO

This ratio is widely used by lenders to assess a firms debt capacity. It’s a major

determent of bond rating. A high average Int coverage means that the firm can

easily meet its Int burden, even if earning before Int and taxes suffer a considerable

decline. This ratio is not a very appropriate measure of int coverage because the

sources of int payments are cash flow before int and taxes, not before int and taxes.

ICR = PBIT

INTEREST

2008-09 = 189

68

= 2.78

2007-08 = 242

40

IBMR Ahmedabad

= 6.05

CHART: INTEREST COVERAGE RATIO

2008-09 2007-08

RATIO 2.78 6.05

0.5

1.5

2.5

3.5

4.5

5.5

6.5

RATIO

Axis Title

Analysis:

A high ratio implies adequate safety for payment of interest.

It is clearly indicates by the above calculation that interest expenses increase

and also PBIT decrease and so it implies that the debt of the company

increase.

IBMR Ahmedabad

Thus in general we can conclude that the growth of the company is very

good, because it has enough position to meet the interest.

6. CUREENT RATIO

Current ratio is the indication of the firm commitment to meet its short-term

liabilities. It is widely used indicator of a company’s ability to pay its debts in

short-term. The Current Ratio is the ratio of total current assets to total current

liabilities. It can be calculated, by dividing current assets by current liabilities.

Current Ratio = Total Current Assets

Total Current Liabilities

Where,

Current Assets = Inventories + Debtors + Bill Receivables +

Marketable Securities + Bank & Cash Balance +

Prepaid Expenses.

IBMR Ahmedabad

Current liability = Creditors + Bill payables + Unpaid expenses +

Provision for tax + dividend Payable + Bank over

Draft.

2008-09 = 1925.71

829.27

= 2.32

2007-08 = 1332.47

610.98

= 2.18

IBMR Ahmedabad

CHART: CUREENT RATIO

2009-08 2008-07

RATIO 2.32 2.18

2.125

2.175

2.225

2.275

2.325

RATIO

curr

ent r

atio

Analysis:

IBMR Ahmedabad

Company’s Current ratio will good as its increase in the current ratio.

From this Current Ratio the Company has better liquidity \short term

Solvency.

7. Net Working Capital:

Net Working Capital (NWC) represents the excess of current assets over current liabilities.

Net Working Capital = Total Current Assets – Total Current Liability

2008-09 = 1096.44

2007-08 = 721.49

CHART: Net Working Capital

IBMR Ahmedabad

2009-08 2008-07

Series1 1096.44 721.49

100

300

500

700

900

1100

NW

C

Analysis:

The ratio represents that part of the long term funds represented by the net

worth and long term debt which is presently blocked asset.

Here, as per the graph, ratio is being increased regularly.

8. Rate of Return on Equity:

Return on Equity = earnings Available to Equity Shareholder

Net Worth

Where,

Profit for the Equity = Net Profit – Preference Dividend

Net Worth = Equity Capital + Reserves – Misc. Expenses

2008-09 = 94.26

836.95

IBMR Ahmedabad

= 0.11

2007-08 = 149.88

767.22

= 0.20

CHART: Rate of Return on Equity

IBMR Ahmedabad

2009-08 2008-07

Series1 0.11 0.2

0.01

0.03

0.05

0.07

0.09

0.11

0.13

0.15

0.17

0.19

ROE

Analysis:

Through the above calculation we can say that the rate of return on equity

ratio is Declining year to year it means shareholders earnings will decline

But

The main cause to decrease the value of the ratio is the increase in the value

of the Net Worth.

IBMR Ahmedabad

LEVERAGE ANALYSIS

FINANCIAL LEVERAGE is the use of debt to increase the expected return on

equity. Financial leverage is measured by the ratio of debt to debt plus equity.

leverage to be positive, the rate of return on the investment must be higher than the

cost of the money borrowed. In general, in finance, leverage is the use of debt

financing. Leverage, within a corporation, is the use of borrowed money to

increase the return on investment.

Impact of leverage on profitability:

Cost of interest and interest coverage:

TABLE (1)

YEARSALE

SEBI

TINTERES

TINTEREST AS A

% OF SALESINTEREST

COVERAGE

2004-05 567 54 11 1.94 4.91

2005-06 871 110 16 1.84 6.88

2006-07 1567 245 28 1.79 8.75

2007-08 1768 242 40 2.26 6.05

2008-09 1914 189 68 3.55 2.78

IBMR Ahmedabad

Analysis:

Interest as a percentage of sales and interest coverage ratios are presented in

table and in figure.

Interest coverage is expressed in number of times, dividing EBIT by interest.

The interest coverage was 4.91 times in 2004-05, sharply increased Up to

2007-08 which shows that it is good for the company.

TABLE (2):

YEAR

SALES

EBIT EBT EPS

% CHANGE IN EBIT

% CHANGE IN SALES

% CHANGE

IN EPS(in

crore)

2004-05 567 54 43 26 - - -

2005-06 871 110 94 61 103.70 53.62 134.62

2006-07 1567 245 217 65 122.73 79.91 6.56

2007-08 1768 242 202 57 -1.22 12.83 -12.31

2008-09 1914 189 121 36 -21.90 8.26 -36.84

IBMR Ahmedabad

TABLE (3)

YEAR DOL DFL TL

2005-06 1.9342 0.796 1.54

2006-07 1.5359 0.855 1.312

2007-08 -0.095 0.886 -0.08

2008-09 -2.652 0.835 -2.21

ANALYSIS:

The different ratios relating to leverages and EPS are presented in table 2,

table 3 and graph. The highest DFL was noticed in 2007-08(0.88) with a

lowest one in 2005-06(0.79)

In case of operating leverages, there was substantial decrease from 2005-06.

TABLE (4)

YEAR % CHANGE IN EBIT % CHANGE IN SALES

2005-06 103.70 53.62

2006-07 122.73 79.91

IBMR Ahmedabad

2007-08 -1.22 12.83

2008-09 -21.90 8.26

Change in sales vs. Change in EBIT

2004-05 2005-06 2006-07 2007-08 2008-09

% CHANGE IN EBIT

NaN 103.7 122.73 -1.22 -21.9

% CHANGE IN SALES

NaN 53.62 79.91 12.83 8.26

-252575

125175225

Axis Title

The above figure show the effect of sales in EBIT. If firm is working with high

operating leverage a proportionate change in sales will bring a more proportionate

change in EBIT.

CONCLUSION

IBMR Ahmedabad

From the above analysis we can see that the leverages do affect the profitability of

the company. The greater is the degree of financial leverage, the greater fluctuation

(positive or negative) in EPS. The shareholders get higher returns when the firm’s

management chooses to use more financial leverage rather than less.

COST OF EQUITY

Equity finance may be obtained in the two ways:

Retention of earnings

Issues of additional equities

The cost of equity or the return required by the equity shareholders is the same in

the both the cases. When a firm decided to return earning an opportunity cost is

involved. Shareholders could received the earnings as a dividend and invest the

same in alternative investment of the comparable risk to earn a return.

Whether a firm raises equity finance by retain earnings or issuing additional equity

shares, the cost of equity will be the same. The only difference is in flotation cost.

There is no flotation cost for retained earning where as there is flotation cost of 2

to 8 % or even more for additional equity. Thus cost of equity refers to the cost of

the retained earnings as well as the cost of external equity.

IBMR Ahmedabad

While the cost of debt and preference can be determined fairly easily, the cost of

equity is rather difficult to estimate. This difficulty stems from the fact that there is

no definite commitment on the part of the firm to pay dividend.

COST OF DEBT

Conceptually, the cost of debt instrument is the yield to maturity of that

instrument .following are the Debt instrument such as debenture, bank loans, and

commercial paper.

Strengths of the Company:

Design and Engineering Testing station and R &D center Fabrication Galvanization Supply chain (by air, sea, etc.) Construction (of towers)

Customers:

Across India :- Power Grid Corporation of India (PGCI) State Electricity Boards (SEBs) of Gujarat, Maharashtra,

Rajasthan, Andhra Pradesh, Tamil Nadu, Madhya Pradesh, West Bengal, UP.

Pre- qualified for all domestic and international tenders. Qualified bids over 20 countries.

IBMR Ahmedabad

Has ‘Trading House’ status and received various Awards for Meritorious performance in Exports from Engineering Exports Promotion Council (EEPC) and Ministry of Commerce, Government of India.

International Partners:

ABB SAE (Italy) Downers (Australia) Grid Comm. (Australia) Areva/Alstom (France) Cegelec (France) Enel Power (Italy) Cobra (Spain) Sumitomo Electric (Japan) ETA (UAE) Hindalco (Egypt) GYM (Peru), etc.

Limitations

As my training period clashed with the firms quarterly auditing period theconcerned person in Finance and Accounting Department were busy with auditing work and thus were not able to provide more time to during the training period.

Moreover the data for the years before 2006-07 where not available and thustaken in approximate figures.

The management of the firm is very busy and was found reluctant to provide

off balance sheet information.

IBMR Ahmedabad

Operating cycle is not found to be uniform and the same was found to be

varying from one period to another due to several inherent problems in

production and distribution system/delivery system/logistic system

prevailing in the organization

Non availability of necessary and relevant data for assessing working capital

requirements due to Retirement of the key personnel and there was vacuum

and lack of proper interface between the firm and me.

Financial analyses are based on historical data and information.

Recommendations and Suggestions

By analyzing the annual report of the company we can conclude that,

From the Liquidity Ratio we can recommend that the Liquidity of the

company is Very Good.

The Current ratio is increases every year. The Current Assets should be at

least twice the Current Liabilities for a comfortable liquid position.

IBMR Ahmedabad

Here we can see that interest to be paid has been cut very well, which is

good for the company in the future.

Bibliography

I have referred following Books& websites for the information about the company

WEBSITES.

1. www.kalpatarupower.com

2. www.moneycontrol.com

3. Annual report of kptl

IBMR Ahmedabad

http://www.moneycontrol.com/

http://www.kalpatarupower.com/

4. Financial management ,by Prasanna Chandra

Books:

Pandey, I. M. Financial Management: New Delhi: Ninth Edition Vikas

Publication, 2006, page. 577-600, 658-667.

Khan, M. Y. Financial Management: An Overview: New Delhi: Seventh

Edition Tata McGraw Hill, 2005, page. 26.1-28.9.

Ram, Paras. Export: What-Where-How: New Delhi: 40th Edition Anupam

Publisher, 2006-07, page. 248-346.

IBMR Ahmedabad

IBMR Ahmedabad

capital structure analysis

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