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A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
CHAPTER-1
INTRODUCTION
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INTRODUCTION TO STUDY
FINANCIAL STATEMENT ANALYSIS
Financial statement analysis is defined as the process of identifying financial
strengths and weaknesses of the firm by properly establishing relationship between the
items of the balance sheet and the profit and loss account.
There are various methods or techniques that are used in analyzing financial
statements, such as comparative statements, schedule of changes in working capital,
common size percentages, funds analysis, trend analysis, and ratios analysis.
Financial statements are prepared to meet external reporting obligations and also for
decision making purposes. They play a dominant role in setting the framework of
managerial decisions. But the information provided in the financial statements is not an
end in itself as no meaningful conclusions can be drawn from these statements alone.
However, the information provided in the financial statements is of immense use in
making decisions through analysis and interpretation of financial statements.
OBJECTIVES OF FINANCIAL ANALYSIS
Financial analysis is helpful in assessing the financial position and profitability of the
concern. This is done through comparison by ratios for the same concern over a period of
years; or for one concern against another; or for one concern against the industry as a
whole (inter-firm comparison); or for one concern against predetermined a standards; or
for one department of a concern against other departments of the same concern (intra-
firm comparison). Accounting ratios calculated for a number of years show the trend of
the change of position, i.e. whether the trend is upward or downward or static.
The main objectives of the analysis of financial statements are to assess:
o The present and future earning capacity or profitability of the concern,
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o The operational efficiency of the concern as a whole and of its various parts or
departments,
o The short term and long term solvency of the concern for the benefit of the
debenture holders and trade creditors,
o The comparative study in regard to one firm with another firm or one department
with another department,
o The possibility of developments in the future by making forecast and preparing
budgets,\
o The financial stability of a business concern,
o The real meaning and significance of the financial data, and
o The long term liquidity of its funds.
In addition to the analysis, interpretation also requires comparison to draw
meaningful results. Mere examination of the various components of financial statements
like current assets, current liabilities, long term liabilities, share holders’ fund, working
capital, gross profit, operating profit, cost of goods sold etc. will not lead to definite
conclusion in regard to the financial status of a business. Comparison of related
components like current assets with current liabilities, long term liabilities with
shareholders fund, gross profit with sales etc. is requires to draw meaning full
conclusions about the position of a company. Therefore, to interpret the position of a
company, it is necessary not only to separate the totals given in its financial statements in
to various components of like nature but also to make comparison of related components.
In addition to this comparison of various components with that of previous year analysis
should be made to know the changes that have taken place in the business over several
years.
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Techniques or Tools of Analysis and Interpretation
The following techniques can be used in connection with the analysis and interpretation
of financial statements:
� Comparative Financial Statements
� Common Measurement Statements
� Trend Percentage Analysis.
� Net working Capital Analysis
� Ratio Analysis
Comparative Financial Statements:
These statements are prepared in a way so as to provide time prospective to the
consideration of various elements of financial position embodied in such statements. This
is done to make the financial data more meaningful. The statement of two or more years
are prepared to show absolute data of two or more years, increases or decreases in
absolute data in value and in terms of percentages. Comparative statement can be
prepared for income statement as well as position statement or balance sheet.
Common Measurement Statements:
Common size financial statements are those in which figures reported are converted to
some common base. Vertical analysis is requires for an interpretation of underlying
causes of changes over a period of time. For this, items in the financial statements are
presented as percentages or ratios to total of the items and a common base for comparison
is provided. Hence vertical analysis becomes possible. Each percentage shows the
relation of the individual item to its respective total. Common size statements may be
used for Balance sheet as well as income statement.
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Trend Percentage Analysis:
This analysis is an important tool of horizontal financial analysis. This analysis
enables to know the changes in the financial function and operating efficiency between
the time period chosen. By studying the trend of each item, one can know the direction of
changes and based upon the direction of changes, the opinions can be formed. This
method is immensely helpful in making a comparative study of financial statements in
several years.
Net working Capital Analysis:
This statement is prepared to know the net changes in working capital of the
business between two specified dates. It is prepared from current assets and current
liabilities of the said dates to show the net increase or decrease in working capital.
Ratio Analysis:
It is done to develop meaningful relationship between individual items or group of
items usually shown in the periodical financial statements published by the concern. An
accounting ratio is the relationship between two inter-related accounting figures as gross
profit to sales, current assets to current liabilities etc.
Profitability Ratios:
Profitability ratios measure the results of business operations or overall performance and
effectiveness of the firm. Some of the most popular profitability ratios are as under:
• Gross profit ratio
• Net profit ratio
• Operating ratio
• Expense ratio
• Return on shareholders investment or net worth
• Return on equity capital
• Return on capital employed (ROCE) Ratio
• Dividend yield ratio
• Dividend payout ratio
• Earnings Per Share Ratio
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• Price earning ratio
Liquidity Ratios:
Liquidity ratios measure the short term solvency of financial position of a firm. These
ratios are calculated to comment upon the short term paying capacity of a concern or the
firm's ability to meet its current obligations. Following are the most important liquidity
ratios.
• Current ratio
• Liquid / Acid test / Quick ratio
Activity Ratios:
Activity ratios are calculated to measure the efficiency with which the resources of a firm
have been employed. These ratios are also called turnover ratios because they indicate the
speed with which assets are being turned over into sales. Following are the most
important activity ratios:
• Inventory / Stock turnover ratio
• Debtors / Receivables turnover ratio
• Average collection period
• Creditors / Payable turnover ratio
• Working capital turnover ratio
• Fixed assets turnover ratio
• Over and under trading
Long Term Solvency or Leverage Ratios:
Long term solvency or leverage ratios convey a firm's ability to meet the interest costs
and payment schedules of its long term obligations. Following are some of the most
important long term solvency or leverage ratios.
• Debt-to-equity ratio
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• Proprietary or Equity ratio
• Ratio of fixed assets to shareholders funds
• Ratio of current assets to shareholders funds
• Interest coverage ratio
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SCOPE OF STUDY:
The study intends to measure the over all performance especially financial
performance of RAIDCO. The study was conducted by using the primary and secondary
data of the company.
PERIOD OF THE STUDY
The analysis is made on the basis of secondary data furnished by ‘RAIDCO’,
for the period of five year from 2004-2009.
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OBJECTIVE OF THE STUDY:
The main objective of the study was to judge the financial position of the
enterprise through analysis of financial Statement.
Secondary objectives:
o To study the liquidity position of the organization
o To study about the long term solvency of the firm.
o To study the profitability of the concern
o To study the earning capacity of the firm
o To have an idea about the overall financial performance of the firm.
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LIMITATION OF THE STUDY
o The tool for the study that is ratio analysis, trend analysis has its own
limitations which in turns effect the accurate evaluation of financial
performance of the firm.
o The analysis was made on the basis of data derived from the secondary
sources and hence the suggestions derived may not be 100 percent reliable.
o The period of study was very limited.
o This study mainly covers the financial aspects and hence the factors which are
non-financial and important for working of the company were not taken into
accounts.
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CHAPTER-2
COMPANY PROFILE
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AN OVERVIEW TO THE COMPANY
Name of the company RAIDCO CURRY POWDER FACTORY
Established : 2000
Address RAIDCO CURRY POWDER FACTORY
,(po)moonuperia , mavilayi, kannur
Business manufacturer, exporter
Primary competitive
it ensures clean and hygiene price quality and
advantage quantity
No of production time four production lines
Export countries gulf countries
(UAE, SAUDI ARABIA, QATAR, etc)
Membership spices board
Awards ISO 9001- 2000
Product range
quality products, spices, spices mix, mineral water,
curry powder, pickles, jam squash etc.
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INDUSTRY PROFILE
India is one of the world second largest producer of food next to china and as
the potential of being the biggest with the food and agricultural sector with India’s food
production to double in the next decade, there is an opportunity for large in investment in
food and food technologies, skills and equipments, especially in areas of canning diary
and food processing, packing. Frozen food and refrigerators and thermo processing, fruits
and vegetables fisheries, milk and milk products meat and poultry. Packaged and
convenience foods, alcoholic beverages and soft drinks sectors of the food processing
industry. Health food and health food supplement are other rapidly segments of their
industry which gaining vast popularity among the health conscious.
The transition from an area of food scarcity to surplus to surplus serve as a witness to
tremendous progress made in the industry being one of the best and most dynamic
markets.
In India, food has seen rapid growth in most of its segments. Increased per capita income
and high cooperate interest in the organized retail market creates a platform for the Indian
food industry. To leap forward all participants in this sector. Especially looking at market
entry and investment in India, will benefit from this briefing include a political industry
profile, growth drivers and growth opportunities.
With the overwhelming the green and white revolution, India is now frequently
poised for the food revolution that will ensure agricultural diversification and large
investments is food processing. The entries of multinationals, aggressive rise of
commodity branding and low cost of technology are changing the economics of the
Indian food industry .the rise aggressive regional, players making forays in
CURRY POWDER IN INDIA
Curry powder, also known as masala powder, is a spice concoction of
extensively varying composition developed by the British during the Raj as a means of
approximating the flavor of Indian cuisine at home. Curry powder is thus an English
invention, where it is still popular. Masala refers to spices, and this is the name given to
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the thick pasty liquid sauce of combined spices and ghee (clarified butter), butter, palm
oil or coconut milk. Curry powder typically includes coriander, turmeric, cumin, and
fenugreek in their blends. Masala is a term used in Indian cuisine to describe a mixture of
many spices. Depending on the recipe, additional ingredients such as ginger, garlic,
fennel seed, clove, mustard seed, green cardamom, black cardamom, nutmeg, red pepper,
cinnamon and black pepper may also be added. It is also the name given to a different
mixture of spices that include curry leaves, which is used in South and Eastern Indian
cuisine. The word curry is a derivative of the south Indian word curriel, which was used
in the local language (Tamil) for a fish stew that had tamarind and curry. This was then
picked up and transformed into the present "curry" by the British. The word "curry", in its
English sense, has no direct translation into any to India's fifteen languages, and Indians
do not use the term even when speaking English. Curry powder is in fact a blend of
spices, varying according to regional preferences or traditions. As a result, there are
literally thousands of "curry powders", each of which was uniquely suited for the produce
and tastes of the region it developed in. Garam Masala is a Northern Indian style sweet
curry blend useful for many vegetarian Indian dishes. Indians tend to use garam masala
of which there are also many incantations. In the south another mixture called "sambhar
powder" is used which is quite different from garam masala. Curry powder, blend of
many spices comes in almost endless varieties. Each curry powder can have different
component spices, in differing amounts--making each curry blend
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ORGANISATIONAL CHART OF RAIDCO
Board of Directors
Chairman
Managing Director
Finance Manager Marketing Manager Purchase Manager
Assistant Manager Regional Manager Asst. Purchase
Manager
Sales Outlets
Factory Manager
Pump set
manufacturi
ng unit
Agricultur
al and
Roller
manufactu
ring unit
Fruit
Canning
unit
Curry
powder
unit
Steel
furniture
manufactu
ring unit
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COMPANY PROFILE
Introduction
The regional agro industrial development cooperative Kerala limited (RAIDCO
KERALA limited)a well organized group in Kerala of co. operative sector under
government of Kerala established in the year 1972 . This is the first federal type of
registered co. operative society in Kerala engaged in manufacturing and marketing
agricultural equipments and implements of improved quality. Its registered office at
Kannur. Right now this co. operative society has four production unit, three service
centers and 43sales outlets throughout the state. This canters the needs of the farmers in
every nook and corner of Kerala.
The RAIDCO has been functioning state for 37yeras and rendering services
to the farmers, general public and workers with an intention to give quality product in the
field of consumer and commercial product at minimum cost. its also rendering services to
farmers by distributing pump set ,power tillers, sprayers and other agricultural
implements of improved qualities manufacturing used by almost all reputed firms in
India. The co. operative which is the first of its kind in the state and had confined its area
of operation to 8 northern revenue districts start from KASARKODE to ERNAKULAM.
The authorize share capital of co. operative is 30 crore. The major
shareholders of the co. operative are the primary society bank functioning in the area of
operation. However membership is open to individual residing in area of operation and
also to state government.
Besides being dealer of all important pump set manufacturers in India the co.
operative also deals in the purchase and supply of industrial machines required for in
small scale industries and rural artisans.
The co. operative has succecceded in making tremendous increase in in sales and the sales
Proceeded also indicates dramatic raise from 6.82 lakhs in 1972-1973 to RS. 76 crores
in 2008-2009.
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The major advantage in the service of this co. operative are that in ensures the
supply of high quality pump set and other agricultural implements considerably low rate
and also provides timely after sales service for the machinery supplied it ,agricultural
work- shop cum- service centers . for undertaking all kind of repairs to all types of pump
set, sprayers , tillers , and tractors etc has been set up at kannoth , chalod in Kannur
district.
The co. operative has entered in the manufacturing field also. According a unit for
manufacturer of irrigation pump sets has been set up at kanjikode in palakkad district
with the technical collaboration of M/s kerloskar brothers ltd. And also with the financial
assistant of national co operative development corporation, New Delhi and government
of Kerala. Besides this co operative has also run a fruit canning unit at mattanur, a rubber
roller manufacturing unit at kanothe meethal, A every powder manufacturing unit at
mavilayi in Kannur district with the financial assistant of NCDC and state government
The pump set manufacturing unit and every powder unit ISO-9001:2000
certificate now this sector entered export also.
‘
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OBJECTIVES OF THE COMPANY(bye –laws)
The main objectives to persuade by the co. operative are.
1. To purchase or manufacture or hire agricultural machineries and implements
inclusive of power ploughs, power tillers. Thrashers, tractors, pump set, pvc pipesetc to
sell or supply hire purchase basis or on hire.
2. To purchase or manufacture industrial machineries either to sell or supply or hire
purchase basis to cottage /small/ medium/large scale industries.
3. To promote establish, maintain and manage the business relating to the manufacture
, purchase and sale of any type of products based on any type of fruits and vegetables.
4. To act as an agent on behalf of the central and state government co. operation ,
organizational institution or concern for distribution of agricultural machinery and other
allied articles.
5. To arrange for procurement or manufacturing and distribution of organic and
chemical fertilizers, seeds with pesticides etc.
6. To undertake rural electrification, lift irrigation programs , small hydropower projects
undertake such works.
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Export Raidco curry powder unit got exporting license in 2006 June. Now the company
exports their products into gulf co. operative council countries. They are mainly
exporting all type of curry powder, masalas, payasam mix and all packed biriyani rice to
these countries. The ramzan trading establishment based marketing Company markets the
RAIDCO FAMILY CURRY POWDER following gulf co. operative council countries.
• UAE
• BAHARAIN
• SAUDIA ARABIA
• OMAN
• QUTAR
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ORGANISATION CHART OF RAIDCO
Board of Directors
chairman
Managing Director
Finance Manager
Marketing
Dept,
Producti
on Dept.
Store
Dept.
Quality
control
Dept.
Finance
Dept.
Purchase
Dept.
Sales
officer
Plant
supervis
or
Clerk Quality
controlle
r
Account
ant
purchase
r
Sales
representa
tive
Technici
an
Lab
Asst.
Clerk Manager
Typist &
Attender
Clerk
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MANAGEMENT OF RAIDCO
� The administration department and management of this cooperative shall
Vest in the board of directors consisting of fifteen members as shown here
Under:.
1. Eleven directors to be selected from A class members from any revenue District
and time, not exceeding three
2. Two directors are selected from B class members
3. One EX – OFFICIO DIRECTOR namely president Kannur district co. operative
Bank, Kannur.
4. Managing director
1. The chairman may be paid a honanararium of Rs. 2500 per month subject to
the approval of registration of co. operative society.
2. The services of directors shall be graduations they may be however be paid
setting fee and traveling allowances for journey performed in connection with
the of the co. operative for attending the board meeting or any sub committee
their after of at the rates fixed by the board of directors to the maximum rates
fixed by registrar
3. The terms of officio of the board of directors shall be five years from the date
of their assumption of officio casual vagrancies arising in the board may be
filled up as provided in the co. operative society.
4. Any elected directors may any time resign from office by sending a letter of
Registration to the chairman of the co. operative.
5. No persons shall be eligible for being elected appointed a member of board of the
6. Co .operative. If he is disqualified under the Kerala co. operative society act
and rules
7. Members of board of directors shall cease to hold office if he invites any of the
disqualification mentioned in the act and rules.
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8. Members of board of directors shall elect from among themselves a chairman and
Vice chairman
MEMBERSHIP
There shall be three class of membership as under:
o A class membership is open to state, district and primary level co. operative
institution, local bodies and co. operative bodies functioning in the area of the
operation of the cooperative.
o B class membership is open to any individual who possess the qualifications
prescribed under the Kerala co. operative society and are residing in the area
of operations of the co. operative.
o C class membership is open to central and state government
CAPITAL STRUCTURE 2008-2009
The authorized share capital of the co. operative structure of the present is Rs. 7
crore.
20000 A class shares of Rs. 100 /each = Rs .10000000
20000B Class share of Rs .100/each = Rs. 2000000
580000 C class shares of Rs. 1000/each = Rs. 58000000
Total = Rs, .70000000
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POLICIES OF RAIDCO CURRY POWDER FACTORY
• Maximum utilization of available resources and capacity
• Reducing time
• Controlling the cost
• Utilization of modern machinery and materials
• Maintaining the improving the quality throughout of manufacturing process
• Low complaints from customers and consumers
SERVICES OF RAIDCO
• Financial assistances to farmers for selecting farm machineries.
• Purchasing and distributing only best quality pump set and other farm
machineries.
• assume best quality of products ISI products
• state government provides subsidies for purchasing raidco pump sets .
• provide one year guarantee and after sale service from RAIDCO PUMPSET.
• products of reasonable price
• provide mobile workshop
• RAIDCO family curry powder unit supply goods to shabarimala devasswam
board for making aravana payasam.
• it supplies goods to P.T .USHA school of sports koyilandi under government
service
• it also supplies essential goods to panchayat owned school as service of
government
• Raidco provides original spare parts
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RAIDCO PRODUCTS
• Chilly powder
• Turmeric powder
• Meat masala
• Coriander powder
• Sambar powder
• Rasam powder
• Pickle powder
• Rasam powder
• Chicken masala
• Aval
• Fish masala
• Whole wheet atta
• Regular atta
• Puttu podi
• Appam podi
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REGISTRED OFFICE AND HEAD OFFICE
Registered office and head quarters of this co. operative are situated at Kannur in
the state of Kerala.
Area of operation
RAIDCO has branches all over Kerala from Kasarkode to
Thiruvananthapuram district. however for conduct of sales and marketing the product
manufactured or dealt in by the co. operative and to develop the infrastructure their if
establishing , opening and running of branches , god owns , showrooms , service centers ,
work shop etc. and appointment of distributors , stockiest and carry forwarding agents
their shall be restriction with regard area of operation.
COMPANY MOTTO
Motto of RAICO KERALA LIMITED is “an intimate friend to farmer”
MANUFACTURING UNITS
a. RAIDCO pump set manufacturing unit
b. RAIDCO Rubber roller manufacturing unit
c. RAIDCO Fruit canning manufacturing unit
d.. RAIDCO CURRY POWDER MANUFACTURING UNIT
BRANCHES AND UNITS
Raidco Kerala limited has 38 branches in all over Kerala. 2 show rooms, 4
manufacturing units and 4 work shop cum service centers.
Fruit processing unit
Pineapple processing unit is started at Mattanur at Kannur district in 1997, with the
financial of Kerala khadi and village industry board. This unit produced various kinds of
pickles, jams, squashes, at large scale and marketed. Now raidco is marketing 10
products from the unit including pineapple products, pickle, jams, squashes and syrups.
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Agricultural workshop cum rubber roller products
Raidco started an agricultural workshop cum service centers in kannothumachal at
Kannur district by the financial assistance of the state government and NCDC. The
objective of the workshop is top repair and service the agricultural like pump set, power
tiller etc at reasonable rates.
Pump set manufacturing unit
Raidco has started a pump set manufacturing unit with the technical assistance for
kriloskar brothers in kanjikode at palakkad district in 1986. Now raidco is providing jet
and mono blocked pump set starting from 0.5 to 1.5hp. Apart from this raidco has
producing thrasher, rubber roller and power etc from this unit.
CURRY POWDER UNIT
Raidco has started a curry powder unit at mavilayi in Kannur district. Raidco curry
powder factory has been set up in assistances with NCDC and state government.
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DEPARTMENTS OF RAIDCO FAMILY CURRY POWDER
� Finance department
� Marketing department
� Production department
� Store department
� Dispatch department
� Human resource department
� Purchase department
� Administration department
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PRODUCTION DEPARTMENT
Among the all the functional area management, production considered to be
crucial in any industrial organization. Production is the process by which, raw materials
and other inputs are converted into finished goods. Efficient production department help
the organization to move according to demand. The factory is the place where production
takes place so the best lay out of the factory must be selected in order to avoid bottle
necks and distribution of production process.
Therefore the production marginal concerned with planning, organizing,
directing , and controlling the production system. So as to produce goods of desired
quality at minimum cost and at the right time. It involves decision making concerned
with production process in order to produce goods or services according to the
specialization of the quality at minimum cost and as per demand schedule.
PRODUCTION MANAGEMENT
Production management refers to the application of management principles to
the application of planning, organizing, directing, and controlling to the production
process. The application to the management to the field of production has been result of
at least three development. First it is the development of factory of production. Until the
emergency of the concept of manufacturing, there was no such thing as management we
know it. It is true that people operated business and did not regard themselves as
managers well. The second essentially stems from the first, namely the development of
the third largest person. Stems from the work of many of the pioneers of scientific
management. Who where able to demonstrate the value from a Performance and profit
Point of view of some of the technique they were developing.
FUNCTIONAL LEVEL OBJECTIVE OF DEPARTMENT ARE
FOLLOWING
• Assuring product as per specification
• Assuring the stock of finished goods as stock level
• Minimizing the wastage of packing material during production
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• Minimizing breakdown time
• Minimizing production loss
• Keep the plant and pemiser clean
FUCTIONING
Production area includes various stages of dispatching largely based on production
capacity of the firm. The company has set as well defined product department under a
plant supervisor. As a food industry the production area must be clean and hygienic as
per HAZRD ANALYSIS OF CRITICAL POINT (HACCP) and ISO requirements. the
operation in the production area is carried out as per the production plan . the plant
supervisors do the allocation of work and he will ensure that the materials will be
allocated to machine for achieving production plan .
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STRUCTURE OF PRODUCTION DEPARTMENT
Board of Directors
Factory Manager
Production Manager
Production Plant Supervisor Technicians
Skilled Workers Unskilled Workers
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PRODUCTION PROCEDURE OR RAIDCO CURRY POWDER
UNIT
DRYING (OPIONAL FOR CORIANDER, CHILLY AND RICE );
Drying is helps to reduce the content of moisture. the drying is carried out in
the sunlight or in the drier at a temrrature about 65-70 degree Celsius
PRE-CLENING (CORIANDER ONLY)
For coriander cleaning is carried out in the pre-cleaner and for rice cleaning is
done manually.
ROASTING (OPTIONAL FOR MASALA AND RICE)
The powder are put into roaster machine and roast it for few minutes .it is the
process of roasting all ingredients up to its characterized smell.
GRINDING:
Grinding is also carried out in grinding mills in two or three stages of powdering.
BLENDING (FOR MASALAS ONLY)
Blending is the process of mixing of different items as per the ratio 30 minutes
using horizontal mixture.
SIEVING
Sift each item with its particular sieves in the sifter.
PACKING:
Finished goods are either packed manually or machine .100g, 250g, 500g are packed
by using FFS MACHINE. Packing of items in polythene \polyester pouches.
WEIGHT CHECKING:
Checking are weight of pouches as per the sampling plan .
PACKING IN HDDLE SACKS
PRODUCTION PLAN
The production department plans monthly production activities. These
production plan based on the report of marketing department. Based on this report the
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production target will be decided and the production target is based on the production
plan. Operator log sheets are prepare or for the verification of the worker will complete.
Their work is according to the target is prepare by production department workers will
submit the log sheet. This will evaluating working performananace .they should maintain
daily shift report, daily production report, weekly production report and monthly
production report.
THE MAIN TYPE OF MATERIAL USED
o Coriander
o Turmeric
o Wheat
o Spices
o Chilly
COMPETITORS ANALYSIS
Now there are very strong competitors in Raidco curry powder market. Many
new competitors are come into the market. The RAIDCO family curry powder has 8.5
market shares in market. But the Raidco products are high quality products. The major
competitors of Raidco curry powder are as eastern Nirapara, Saras, etc. the market survey
revealed that the eastern curry powder is the leading manufacturing of curry powder in
Kerala. They cover more than 50% share in market.
CHIEF COMPETITORS OF RAIDCO
� Eastern curry powder
� Melam curry powder
� Mangala curry powder
� Palat curry powder
� Saras curry powder
� Dinesh curry powder
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� Priyum curry powder
� Rani curry powder
� Amina curry powder
� Mohanlal taste buds
� Nirapara curry powder
COMPETITORS MARKET SHARE
COMPETITORS MARKET SHARE
Eastern curry powder 50%
Melam 12%
Saras curry powder 9%
Rani curry powder 10%
Raidco curry powder 8.5%
Nirapara 8%
Mangala curry powder 7%
Amiina wonder spice 7%
Mohanlal taste buds 5%
Amma curry powder 5%
Shakti masala 5%
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SALES TURN OVER RAIDCO AND MONTHLY COMPETITORS
CURRY POWDER TOTAL SALES TURN OVER (MONTHLY)
Easten curry powder 680
Melam masala 500
Saras curry powder 460
Rani curry powder 400
RAIDCO family curry powder 350
Amina wonder spice 320
Shakti masala 310
Among this market survey reveals that the eastern curry powder leading
manufacturing of curry powder in Kerala. They cover more than 50s% share in the
market. saras cover more than 50% of the production stage but now it is only 9% market
share .
FEATURES / CHARACTERSTICTS OF COMPETITORS IN RAIDCO
1. Competitors are modern equipment, but Raidco still hang over to traditional method
2. Competitors undertakes more advertisement and promotional strategies
3. The competitors products are available the consumer who it is needed
4. More of the competitors are in existence before the establishment of RAIDCO
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5. Competitors occupy large portion of market share , but RAIDCO only 8% of market
share
6. Low cost and high quality
7 . Hygienically made product in modern factory
8. Timely delivery
9. quick responsibility of consumers queries
10. Transparency in business adherence in cooperative ethics
PURCHASE DEPARTMENT
The purchase of required raw materials of right quality is the responsibility of
the purchase department .the department , which is under the control of RAIDCO curry
powder , is purchase officer .purchase department is responsible for all thepurchase
related to the factor which includes raw material, machine parts and new machines .the
purchase system starts from the intend in t ne prescribed format given by the respective
department in order according to their requirement . as per the ISO norms the suppliers
of raw materials should be authorized supplier . the management committee in the
management review meeting gives the authorization . purchase department should be
responsible for the timely supply of all items required in the factory . it should also find
new suppliers, raw materials, peak seasons for each items , comparative study of quality
price and present market scenario
PURCHASE PROCEDURE
All raw materials are classified into two categories A and B
MAJOR ITEMS
MINOR ITEMS
a. MAJOR raw material is chilly, coriander, turmeric, raw rice and wheat. Purchase
order are placed with approved vendors for major items . the list of post suppliers
has been maintained B aged of the annual production in bulk quantity during the
crop season and stored.
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b. MINOR items include spices, pulses, and salt. These items need small quantities
for the production of masalas purchases from local market. This is approved by
factory manager, after quantity wise comparative analysis in lab by quality control
officer.
PLACE OF PURCHASE
Chilly – Karnataka and Andhra Pradesh
Coriander - Rajasthan and Tamilnadu
Turmeric - Salem (Tamil nadu)
Wheat - Punjab
Spices - purchase from local market
MODE OF PAYMENT
Minimum one month credit period is available by RAIDCO curry powder to make
the necessary payment to its supplier
HUMAN RESOURCE DEPARTMENT
Human resource management relatively a new term emerged during 1970s many
people continued to use , traditional titles like personal management to this new
discipline. At present the term is used in this industry including circle as HRM.
A well managed human resource is working under RAIDCO CURRY POWDER.
Here the human resource department known in the name of administration department.
Which is under the control of administrating manager or administrating officer? This
department looks after the welfare of human resource in RAIDCO labor are the only
living factors of production process. They are pillars of organization the quality of
production, the earning and good will of the company depends upon human resource in
the organization. The company treats the labours fairly and considerably and given fare
wages. Personal department under takes, recruitment, selection, training etc.
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NUMBER OF EMPLOYEES
RAIDCO curry powder factory has 53 casual workers and 16 permanent
employees .among 16 permanent staff , 10 members are office staff and 6 are production
staff . 53 casual workers includes 22 gents and 31 ladies
Time office
There is a time office work in the factory. It is maintained in the factory gate. The
time officer and one securities are work in these department. The major function of
these department is maintain and regulate the attendance of workers visitors and vehicle
movements in the factory. The time of entry and exit properly enter in the register. The
time office or time keeper will coming with attendance register for verification. Last date
of every month. It is verified by the administrative officer.
Working time
There is only one shift presently in the factory. The working time shifting1st shift -
9.00 am to 4.30pm
Function of Human Resource Department
1. Recruitment
Recruitment means generating a pool of qualified employees for job. Announcing
job opportunities to public in such a way that number of suitable people will apply for
them. In RAIDCO done only at the initial stage. At that time the placement of employees
is done by haed office, for recruitment .the Company gives advertisement in newspaper
.after that applicant will have written test. According to the mark obtained in the written
test the applicant will have to be call for an interview. Through this interview the
applicants are selected for the company. Recruitment also made from the educational
institution and training institution
The head office situated at Kannur undertakes placement. Recruitment is done
through
Advertisement – written test – interview and selection
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Probation period up to one year
2. Selection
Selection means choosing right profile from that number, those applicant whom
are most likely to succeed in the job. After getting the list of candidates, an interview
conducted at the unit level. Final selection is made after test their skill and technical
ability by putting them on the job.
Training and development
Training and development is also done in the RAIDCO. After recruitment and
selection the new hands are given on the job. Training at the unit level. months to one
year. Later the absorbed as permanent workers considering their performance
3. Promotion :
Promotion is the transfer of an employee to new position which comments high
pay. Privilege status both at work and in the community out side more pay and fringe
benefits perhaps the grater. Jobs security and more senior position from which a person
render better service to his company. His duties, responsibilities status and pay also
increased. Company given keen attention with regard to promotion. In AT1 seniority
based and merit based promotion are there.
is at 4.75 % of total employments (growth)
WAGES AND SALARY;
The salary given to the employee according to the Kerala state co. operative rules .in LD
clerk grade employees are given to pay scale RS.3295/- in probabation period after one
year that will get RS. 80/-additional and 38% DA. Apprentice trainee will given a stipend
RS.1090/-. The wages given to the casual workers according to the factory wages act .the
men RS. 100/-day and women RS .90/-day .the driver will get 125/-day .
BONUS:
The company will given bonus at the rate 8.33% .the rate of bonus will give up to 20% in
the profitable year.
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PROVIDENT FUND:
Provident fund deduction from the salary at the rate of 12%.another deduction from
the salary rat the rate of 12% pension benefit .from this 8.33% will be pension fund.
ALLOWANCES:
Medical allowance of RS.1000/-for employee. The production workers will get
RS.300/-as uniform allowances and RS.20/- washing allowances .
RETIREMENT:
The retirement is in the age of 58yearas. At the time of retirement the employee will be
given PF and pension fund deducted from his salary .
TRANSFER:
Punishment
Request transfer
General transfer
Normally transfer performing in the month of APRIL TO MAY
Leave and Holidays
a ) Privilege leave
All permanent employees are allowed privilege leave at the rate of day for
every twenty day of worth in a year .This leave provides only the workers who worth
minimum 240 day in a year .They ean avail of leave in five times in a year subject to
certain restriction to account the production prospects the factory
b) Causal leave
The allowed to a meet the casual needs. There are 15 casual leaves in a year
Holidays
Total 13 days are allowed for the employees including 4 national holidays
belongs any trade union decide about the holidays
Compliance of Factory Act
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WELFARE TO WORKERS
1. First Aid Appliances
Under the factory Act ,It is strictly instructed that a manufacturing concern should
keep necessary first aid faculties .this is done in case of when the workers are Injured
during the worth .If the injury or accident more serious employee can sent to near ESI
center for further treatment
2. Canteen
A good canteen is available rate to all employees in this canteen provide tea in the
right time at two shift to employees to at free cost
3. Rest room
A rest mean is provided to employees to relax at the concerned time
4. Facilities for Relaxing
The company also provides sitting facility for the workers when they are getting
interval or lunch breach
5. Trade union
The factory is in under co. operative society. There are mainly two trade unions
KCEU- Kerala co. operative employees trade union (CITU)
KCEF –Kerala co. operative employee front (INTUC)
Health
One of the important things is that the employees’ general health, both physical
and mental should be cared. The factors, which influence the general health of the
worker, can be divided into two broad groups.
1) Those which are associated with his working environment.
2) Those which he shares with the rest of the community.
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Disposal of waste and effluents
Effective arrangements shall be made for the disposal of waste and for making
them innocuous. It does not harm any local people in any way.
. Dust and fires
Effective management shall be taken pre view the inhalation and accumulation of dust
and fires or other impurities in parities at work place
Lighting
The state government may prescribe standards of are proper artificial nature lighting
facilities are included
Drinking Water
There shall be effective arrangements for whole some drinking water for workers for
worker at convenient points
Laundries and urinals
There shall be sufficient number of laundries and a urinals clean well ventilated situated
and built according to prescribed standard separately for male and female and workers.
QUALITY CONTROL DEPARTMENT
The quality is the performance of product as per the committed made by the
producer to the consumer. The quality control department is responsible for analyzing the
quality of the products of the products through various tests. The head of the quality
control department is quality control officer
The department tests samples of raw material from the suppliers , raw materials
purchased samples from production area and also random checking finished goods . the
quality control department should draft the specialization for raw materials as per ISO
norms . Raw materials are inspected initially by visual inspection and then by physical
analysis. Granulations as well as chemical analysis are tested and weights of the finished
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pouches are also checked. This test is carried out for each batch in the case of chilly ,
coriander, turmeric, and curry powders.
QUALITY POLICIES AND OBJECTIVES OF RAIDCO
a. RAIDCO deliver products that meet according to the customer taste and
satisfaction. They deliver the best value for money to the customers.
b. RAIDCO continuously invest in their people and technology to deliver quality
products
c. They assuring the products as per specification, maintains and improving the
quality through good manufacturing practices. To stimulate an aggressive quality
consciousness among all company employees.
DISPATCH DEPARTMENT
Dispatch department of the factory is responsible for the dispatch of
finished goods of various dealers. . Stretch across Kerala as per the direction from
marketing department. The dispatch department should deliver the required items at
the previously decided destinations without any delay. They should collect
acknowledgement for the receipt of items in good condition from the dealers. They
should control the companies own vehicle and its staff is constitution with factory
manager. They should also make decision on the preference of goods and also the
way of the vehicle through which it should travel. They also arrange parcel service
for the delivery of the goods.
The department is responsible to keeping packing details, bill details of various
parties. it hold assure the vehicle contain the packing slip, bill copies ,sales tax
declaration for check posts. They should issue gate passes requirement for any
vehicles as the any case. As in any cases the department should contact dealers and
parcel service and report day to day affairs .RAIDCO‘s 90% shares are government
shares. But it is working as co. operative sector. Company is targeting 6 crores in
coming years to recover the present condition.
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STORES DEPARTMENT
Store department releases required item for representative department s
whenever it is demands, always keeping the minimum stock levels for all raw
materials. Store department repots to the purchase department whenever the stock
level reaches to the minimum level . Purchase department transfers the purchase
items to the store.
Production and maintenance department repots their ‘Good Requisition Note ‘to
the store department. After getting this note, the store department issues with, Good
Issue Note. It also releases finished goods to the dispatch department whenever
supply order comes from the dealer . the important function of store department is
checking and cleaning the raw materials coming into their go down on purchase
order . After receiving the materials the store department prepares goods received
note .
ITEMS INCLUDE STORES:
• Raw materials are chilly, turmeric, spices and coriander
• Raw materials
• Consumer stores
• Consumer spares
WAREHOUSE
There are four different warehouses in the factory. They are
• large raw materials
• Temperature and humidity controlled ware houses for minor spices and food
products.
• Two packing materials warehousing located in various areas
• All the warehouses are kept in accordance with food materials storage
standards and HACCP regulation.
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MARKETINGDEPARTMENT
The term marketing means social and managerial process by which
individual and group obtain what they need and want through creating and exchanging
product and value with others. In the words of Philip Kotler “marketing is a societal of
process by which individuals and group obtain what they need and want through creating,
offering and freely exchanging product and services of value with each other”.
RAIDCO family curry powder unit has a good marketing and sales department.
They are doing marketing allover the Kerala in a systematic way and also marketing their
products into gulf countries also . the main duties of the marketing department in an
organisation are to analyse the market , find the opportunities , design the products ,
format marketing strategies , develop scientific method and action purpose a budget and
establish a set of control . Now a days there is a number of alternative products, so that
customer has a number of choices . So the success of product depends upon their
marketing departments and something different from its competitor’s production in terms
of quality, quantity, packing design etc will effect the consumers design. In short modern
marketing begins with the consumer and ends with the consumer’s satisfaction and social
well being. Under the market driven economy consumer is the king.
SCOPE OF MARKETING:
The scope marketing is very wide because marketing performs multi - various
functions. These functions includes warehousing, packing, branding , selling ,
transportation , advertising , public relation , marketing research , product planning etc .
• Understanding customers needs and wants
• Consumers satisfaction
• Study of buyers behaviour
• Product planning and development
• Pricing policy
• Demand strategy
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• Distribution
• Promotion
MARKETING DEPARTMENT OF RAIDCO FAMILY CURRY POWDER
The main responsibilities of the marketing department are to ensure the receipt
of good quality materials to the consumers as and when required. The marketing
department is headed by the marketing manager and sales officer. They have five area
representatives as their subordinates.
RAIDCO is having good marketing channel in northern part of Kerala . The main
aim of the marketing department is to supply good quality products according to the
needs of the customers and at reasonable price. RAIDCO family curry powder has
good marketing and sales department. They are marketing their products in gulf
countries like (Qatar, Oman, Bahrain, and Saudi Arabia) also. Marketing department
is working in RAIDCO in systematic way. RAIDCO covers marketing all over the
Kerala through dealer network Company and has district wise representative under
this; they have Taluk wise distribution.
OBJECTIVES OF MARKETING DEPARTMENT:
The primary objective of RAIDCO is to give maximum satisfaction to the
customers by giving quality products.
a. Creation of goodwill by selling quality products
b. Reducing cost
c. Increasing the consumption of goods
d. Increasing the profit through consumer satisfaction
e. Ensure the growth and development the organization
f. Taste and preference of the consumer
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MARKETING CHANNEL OF RAIDCO FAMILY CURRY POWDER
UNIT
FACTORY
REGIONAL
GODOWN Palakkad
Kottayam
Trivandrum
Malappuram
DIRECT
MARKETING Only in the Kasargod
district
DISTRIBUTORS Kannur
Kasargod
Calicut
DISTRIBUTORS
RETAILERS
CONSUMERS
CONSUMERS
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ORGANISATIONAL CHARTS OF MARKETING DEPARTMENT
Board of Directors
Chairman
Managing Director
Factory Manager
Marketing Department
Marketing Manager
Sales Officer
Sales Representative
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MARKETING PROCESS:
. The process of marketing is the soul of marketing mechanism. Marketing is
concerned with the flow or movement of goods from the point of production to the point
of consumption in this flow goods passes through certain essential flow
There are three main process of marketing:
• Concentration
• Dispersion
• Equalization
Concentration:
Concentration is the process of concentrating raw materials an finished goods at a
central place called market. The concentration function is performed by producers,
wholesalers and their agents.
Dispersion
The concentration is where completed the dispersion starts. It means the distribution
of raw material and finished goods to producers and consumers. Raw materials are
distributed to manufacture and furnished goods to whole salers, retailers, and consumers.
Equalization:
Equalization lies in between concentration and dispersion. It consists of adjustment
of supply demand on the basis of time quality. It means adjustment of supply to demand
through storage and transportation.
MARKETING MIX:
Marketing mix is the combination of various elements . marketing mix is the process
by which set of marketing variable which the firm produces response at once is the target
marketing . the marketing mix are as follows
A. Product mix
B Promotion mix
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C. price mix
D. Place mix
Product mix:
Product mix is the total list of product which offers to its its buyers . it is the
complete list of all products offered for sales by a firm . Product mix is also called
product portfolio or product range.
PRODUCT BRANDING
The product branding is the identification of product one seller or group of seller
differentiates from their competitors. The product branding is mainly using the term sign,
symbol, design or a combination. The products from RAIDCO curry powder are known
and familiar among the costumers under the brand name of “FAMILY”.
Brand ambassador – P.T.USHA
OBJECTIVES OF BRANDING:
Its helps in product identification
It makes the product attractive and popular
It helps in advertising and sales promotion
It develop brand loyalty
PACKING
The importance of packing has increased these days because of severe competition in
the market and rise in the standard of living of the people. Well designed packages can
create convenience and promotional value .in RAIDCO curry powder factory finished
goods are packed either manually or machine. 100gms, 250gms, 500gms, are packed
using FFS machine .1kg, 2kg, are manually filled into 25kgs bags for dispatch. For
special bulk order packing is done 25kgs. For packing Polythene pouches and polyester
pouches are used which are purchased from SIVAKASI. The main objectives of packing
are promotion, safety, identification etc.
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LABELING:
Labeling is the integral part of packing. It gives verbal information of the product. it
serves to identify brand , product type and size , batch number and date of manufacture
and price of the product.
PRICE MIX:
RAIDCO curry powder factory unit follows cost plus pricing which means
cost plus ascertain amount of profit. In this unit pricing policies are related to only a
certain period of time, because necessary changes must be made in the pricing decision
according to the need of time and circumstances such as cost object of the company
marketing mix, demanded, consumption, and economic condition etc . Pricing of the firm
also decides the rate of return and profit of the firm. Advertisement and sales promotion
measures are also affected by pricing decisions. The price of the product is based on the
costs of the products and a change to the price of raw materials affects the price of the
final products. The raw material like chilly, turmeric, etc varies and its affects the market
fluctuations. It means the price of raw materials changes in every day and it affected the
price of the final products.
PLACE MIX (DISTRIBUTION CHANNEL):
The channel of distribution means the set of marketing intermediates through which
the goods flow from the producer to consumer. In short, it is outlet to let out the goods to
final consumer.
Most producers do not sell their goods directly to ultimate users. there may be
intermediaries ,these intermediaries constitute a marketing channel also called trade
channel . There are several channels through which it is possible to have these curry
powder factories products to be marketed.
1. Raidco curry powder unit produces are marketed through dealer network .The
Company has district wise area representatives. Distributors supply the products
to the retailers. The company have five area sales officers located in Kannur,
calicut, Kottayam and Trivandrum . the company has very good marketing
system through its dealer which comes around 14 in members in Kannur and
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Kasarkode district ., clearing and forwarding agents for marketing . The company
adopts DIRECT RETAILER system in Wayanad district on experimental basis.
The sales representative is responsible to submit monthly sales reports to
marketing department. the levels , which exists between the manufacturers and
end users can broadly divided into four :
1. producer -consumer (direct marketing)
2. producer –retailer – consumer (one level channel)
3. producer-distributor-retailer-consumer (two level channel)
4. producer –distributor –wholesaler-retailer – consumer (three level channel)
SELECTION OF CHANNEL:
• Financial capacity
• Previous experience
• Target market ability
• Godown facility
PRAMOTION:
Promotion is the one of the major elements in the marketing mix. Promotion
is a form of communication with an additional element of persuasion to accept ideas,
products and services and hence persuasive communication becomes the heart of
promotion. People must know that products at the right price are available at the right
place. it is said that in competitive market , without promotion nothing can be sold .
The main sales promotion activity adopted by the RAIDCO FAMILY CURRY
POWDER unit is advertising .covering Medias like magazines; railway stations plat
form, wall paint banners, stickers etc.
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Sales promotion method includes complimentary items to dealers .dealers may give
cash discount up to 4% to 10% for ready payments. The company is also adopts
another attractive schemes in festival seasons.
OBJECTIVES OF PRAMOTION BY RAIDCO
To communicate
To convince
To motivate
To differentiate
To stabilize sales
ADMINISTRATION DEPARTMENT:
The responsible of administration department is mainly to keep the records of
attendance of staff and workers .it also includes records of various levels taken by the
employee and management staff, calculation of the salaries, provident fund, bonus o f
employees and record of their entry into service, issue of memos, service rules related
matters
TAX PAYMENT:
The administration department will be liable to pay tax in OCTOBER and professional
tax in every six months to concern authority. The department is also responsible for the
renewal in factory license in OCTOBER. the administration department is responsible to
submit half year return report and annual report to factory inspector office ,KANNUR.
Other major responsibility of the administration department is dealing with letter. the
administration department keeps record of letter inward register and letter outward of
dispatch register
FINANCE DEPARTMENT:
Finance department maintain a systematic record and control income anf\d
expenditure of the factory. Account officer is the head of this department followed by
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financial account department and he is assisted by an assistant account. All financial
decision are taken by the finance department
SOURCES OF FINANCE:
• Share capital
• Deposit from dealer
• Deposit from staff
• NCDC loan
• State government loan
• Cash credit
ACCOUNTING POLICIES:
1. fixed assets are valued at cost of acquisition ,less depreciation
2. depreciation and fixed assets are calculated and provided on straight line method
(10%depreciation is charging )
3. investment are valued at cost
4. valuation of inventories of finished goods is at cost
ACCOUNTING PROCEDURE:
RAIDCO curry powder factory follows double entry system in accounting records
day to day transaction of cash receipt and payment voucher. The accounting department
will make necessary entry in cash book , bank book , or journal accounting to the nature
of transaction, personnel registers of distributors suppliers and staffs ,general ledger, sales
register, purchase register ,register of all assets are prepared by the accounting
departments .
Their jobs including recording of all the payments given to suppliers and payment
received from the dealers .this includes the payment for all the purchase related to the
factory and distribution of salaries,wages to its staffs monthly receipt and distribution
statement and balance sheet should be defeated consultation which head officers and
submit them to the finance manager of RAIDCO .
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After preparing receipt and distribution statement the company will prepare
manufacturing accounts to know the cost of goods manufactured . The items in
manufacturing accounts are raw materials ,purchase, direct expense, direct wages,
opening and closing of raw material
Accounting department is also responsible for the function of day to day works of the
factory .they should also keep detailed individual report for different suppliers
,dealers and personnel .separate accounting heads are been maintained for different
categories of finance .it keep bill related to responsible files for later references .it
should also report present financial status of the company to higher authorities and
calculated cost required for different product. And report to its concern. Debtors
earned outstanding in payment cash if any should be reported the earliest. They
should also conduct concern parties for the same .
It should also give monthly sales statement to the finance department of
RAIDCO.day to day affairs in finance matter export to the factory and also to the
finance department given by the factory manager
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CHAPTER-3
RESEARCH METHODOLOGY
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METHODOLOGY
Research Methodology is the systematic way of solving the research problem. It
may be understood as a science of studying how research is done scientifically. So while
we discussing about the research methodology we discuss not only the research methods
but also we consider the logic behind the method that we used in the context of our
research study and explanation why we are not using other so that research results are
being capable of evaluating the researcher himself or by others.
Source of data:
Primary Data:
The information relating to the companies functions, its operations etc are collected
by direct observation and by interviewing concerned personnel.
Secondary Data:
The data related to the financial statements are the essential elements of this
study. These financial data are collected from the financial records of the firm like Profit
and Loss account and Balance sheet.
Tools used:
Data analysis tools:
� Ratio Analysis: Current ratio or working capital ratio:
It is the ratio of the current assets to current liabilities. It shows a firms’ ability to
cover its current liabilities with its current assets. Generally 2:1 is considered ideal for a
concern.
Current Assets
Current ratio= -----------------------
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Current Liabilities
Liquid or Quick ratio:
This is the ratio of the liquid assets to current (liquid) liabilities. It shows a firms’
ability to meet current liabilities with its most liquid (quick) assets. 1:1 ratio is considered
ideal ratio for a concern. Liquid assets include cash balances, bill receivable, sundry
debtors and short term investment. Liquid liabilities include all items of current liabilities
except bank overdraft. It is calculated as under:
Liquid Assets
Liquid ratio=------------------------
Current liabilities
Absolute Liquidity ratio:
Though receivables are generally more liquid than inventories, there may be
debts having doubt regarding their real stability in time. So to get idea about the absolute
liquidity of a concern, both receivables and inventories are excluded from current assets
and only absolute liquid assets, such as cash in hand, cash at bank and readily realizable
securities are taken into consideration. The desirable norm for this ratio is 1:2. it is
calculated as follows:
Cash in hand and at bank+ short term marketable securities
Absolute Liquidity ratio=------------------------------------------------------------------------
Current Liabilities
Ratio to Inventory to Working capital:
In order to ascertain that there is no over stocking, the ratio of inventory to
working capital should be calculated. Working capital is the excess of current assets over
current liabilities. Increase in volume of sales requires increase in size of inventory, but
from a sound financial point of view, inventory should not exceed amount of working
capital. The desirable ratio is 1:1. It is worked out as follows:
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Inventory
Ratio to Inventory to Working capital=---------------------
Working capital
Fixed Assets ratio:
This ratio explains whether the firm has raised adequate long term funds to meet its
fixed assets requirements. This ratio gives an idea as to what part of the capital employed
has been used in purchasing the fixed assets for the concern. If the ratio is less than one it
is good for the concern. The ideal ratio is .67. It is calculated as under:
Fixed Assets
Fixed Assets ratio=------------------------
Capital employed
. Ratio of Current Assets to Fixed Assets:
This is the ratio of the Current Assets to Fixed Assets. This ratio is worked out as:
Current Assets
Ratio of Current Assets to Fixed Assets=------------------------
Fixed Assets
Debt Equity ratio
It measures the extent of the equity covering the debt. This ratio is calculated to
measure the relative proportions of outsiders’ funds and shareholders’ funds invested in
the company. This ratio is determined to ascertain the soundness of the long term
financial policies of the company and is also known as external- internal equity ratio. It is
calculated as follows:
Long Term Debts
Debt Equity ratio=-------------------------------
Shareholders’ Funds
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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. Proprietary ratio:
A variant of debt to equity ratio is the proprietary ratio which shows the
relationship between shareholders’ fund and total tangible assets. This ratio should be
1:3. it is worked out as follows:
Shareholders’ Funds
Proprietary ratio=-----------------------------
Total Tangible Assets
Net Profit ratio:
This ratio explains per rupee profit generating capacity of sales. If the cost of
sales is lower, then the net profit will be higher and then divide it with the net sales, the
result is sales efficiency. If lower is the net profit per rupee of sales, lower will be sales
efficiency. This is very useful to the proprietors and prospective investors because it
reveals the over all profitability of the concern. It is calculated as follows:
Net Profit after Tax
Net Profit ratio=-----------------------------
Net sales
Return on Shareholders Funds:
The ratio of net profit to shareholder fund shows the extent to which profitability
objective is being achieved. .When this desired to work out the profitability of the
company from the shareholders point of view, then this ratio is calculated by the
following formula:
Net Profit after Interest and Taxes
Return on Shareholders Funds=--------------------------------------------
Shareholders’ Fund
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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. Capital Turnover ratio:
This ratio shows the efficiency of the of capital employed in the business by
computing how many times capital employed is turned-over in a stated period. The
higher the ratio, the greater are the profit. A low capital turnover ratio should be taken to
mean that sufficient sales are not being made and profits are lower.
Sales
Capital Turnover ratio=--------------------------
Capital Employed
. Fixed Assets Turnover ratio:
This ratio measures the efficiency of the assets use. The efficient use of assets will
generate greater sales per rupee invested in all the assets of a concern. The inefficient use
of the asset will result in low sales volume coupled with higher overhead charges and
under utilization of the available capacity. Hence the management must strive for using
total resources at optimum level, to achieve higher ROI. It is calculated as under:
Sales
Fixed Assets Turnover ratio=-----------------------------
Net Fixed Assets
Working Capital Turnover ratio:
This ratio shows the number of times working capital is turned over in a stated
period. The higher is the ratio, the lower is the investment in working capital and greater
are the profits. It is calculated as follows:
Sales
Working Capital Turnover ratio= --------------------------------
Net Working Capital
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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Total Assets Turnover ratio:
This ratio is calculated by dividing the net sales by the value of total assets. An
higher ratio is an indicator of over trading of total assets while a low ratio reveals idle
capacity
Net Sales
Total Assets Turnover ratio=----------------------
Total Assets
. Inventory turnover ratio:
This ratio measures the number of times, on average; the inventory is sold during
the period. Its purpose is to measure the liquidity of the inventory. This ratio is calculated
as follows:
Cost of goods sold
Inventory turnover ratio=---------------------------
Average inventory
. Receivable Turnover ratio:
This ratio measures the number of times, on average; receivables are collected
during the period. The higher the value of ratio, the more is the efficient management of
debtors. It is calculated as follows:
Net Credit Sales
Receivable Turnover ratio=-----------------------------
Average Receivables
Creditors Turnover ratio:
A short-term liquidity measure used to quantify the rate at which a company pays
off its suppliers. Accounts payable turnover ratio is calculated by taking the total
purchases made from suppliers and dividing it by the average accounts payable amount
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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during the same period.
Solvency ratio:
This ratio expresses the relationship between total assets and total liabilities of a
business. It measures the solvency of the business. It is calculated as follows:
Total Assets
Solvency ratio=-----------------------
Total Debts
Cash ratio:
This is the ratio of a company's total cash and cash equivalents to its current
liabilities. The cash ratio is most commonly used as a measure of company liquidity. It
can therefore determine if, and how quickly, the company can repay its short-term debt.
A strong cash ratio is useful to creditors when deciding how much debt, if any, they
would be willing to extend to the asking party.
Cash and cash equivalents
Cash ratio=-------------------------------------
current liabilities
Cash Turnover ratio:
This ratio indicates a firm's efficiency in its use of cash for generation of sales
revenue. It is the inverse of cash-to-sales ratio.
Sales
Cash Turnover ratio=------------------------------
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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Average Cash Balances
Cash to Working Capital Ratio:
Cash To Working Capital Ratio is useful for determining the proportion of
working capital that is made up of cash or investments that can be readily converted into
cash. If the ratio is low, it may be an indication that a company will have trouble meeting
its short-term commitments because of a lack of cash. If this were the case, the next
formula to calculate would be the number of expense coverage days to determine exactly
how many days of operations can be covered by existing cash levels.
Cash + short term marketable securities
Cash to Working capital ratio=-------------------------------------------------
Net Working Capital
. Average Collection Period:
It indicates on an average for how many days sales are pending uncollected by the
concern. This also reflects the credit policy and terms of the concern.
Days in a year
Average Collection Period=-------------------------------------
Debtor Turnover ratio
. Average payment period:
The average payment period (APP) is defined as the number of days a company
takes to pay off credit purchases. It is calculated as accounts payable / (total annual
purchases / 360). As the average payment period increases, cash should increase as well,
but working capital remains the same. Most companies try to decrease the average
payment period to keep their larger suppliers happy and possibly take advantage of trade
discounts.
Days in a year
Average payment period=---------------------------------
Creditors Turnover ratio
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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� Comparative Statement
� Common Size statement
� Schedule of changes in Working Capital
Data Processing Tools:
� Tables
� Bar charts
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
- - 65 -
CHAPTER-4
ANALYSIS AND INTREPRETATION
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
- - 66 -
CURRENT RATIO
CURRENT RATIO FROM THE YEAR 2005-2009
YEAR CURRENT ASSETS CURRENT LIABILITY RATIO
2005 16044478 9197848 1.744373
2006 11000342 14673592 0.749669
2007 17920383 18617992 0.96253
2008 20221795 16286604 1.241621
2009 22377147 11066114 2.022132
CURRENT RATIO
0
0.5
1
1.5
2
2.5
2005 2006 2007 2008 2009
YEAR
RA
TIO
RATIO
INTERPRETATION:
The above table shows the current ratio of the firm during the period (2005-2009)
of the study has been increasing. In the year 2005 the ratio was 1.71 and increasing at the
rate 2.022 in the year 2009.It shows the rate in the year 2009 above the standard norm
2:1.Therefore the current ratio of the firm indicates ability to meet its short term debts.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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LIQUID ASSET RATIO
LIQUID ASSET RATIO(2005-2009)
YEAR LIQUID ASSETS CURRENT LIABILITY RATIO
2005 5790241 9197848 0.629521
2006 6929493 14673592 0.472242
2007 9789943 18617992 0.525832
2008 12072775 16286604 0.74127
2009 15459717 11066114 1.397032
LIQUID RATIO
0
0.5
1
1.5
2005 2006 2007 2008 2009
YEAR
RA
TIO
RATIO
INTERPREATION
Liquid ratio of the firm during the period (2005-2009) shows a fluctuating trend.
During the period 2005 to 2008 it was below the standard norm 1:1.But in the year 2009
shows an increasing trend. It shows that the firm’s ability to meet its short term obligation
out of its liquid assets.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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ABSOLUTELIQUID RATIO
ABSOLUTELIQUID RATIO FROM THE YEAR 2005-2009
YEAR ABSOLUTE LIQUID ASSET RATIO CURRENT LIABILITY RATIO
2005 66546 9197848 0.007235
2006 52548 14673592 0.003581
2007 388305 18617992 0.020856
2008 388985 16286604 0.023884
2009 230152 11066114 0.020798
ABSOLUTE LIQUID RATIO
0
0.005
0.01
0.015
0.02
0.025
0.03
2005 2006 2007 2008 2009
YEAR
RA
TIO
RATIO
INTERPREATION The absolute liquid ratio of the firm during the period (2005-2009) are below the standard
norm 1:2 .This ratios show that the absolute liquid assets of the firm is very less. The firm
may not have enough cash/bank balance or marketable securities.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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SOLVENCY RATIO
SOLVENCY RATIO FROM THE TEAR 2005-2009
YEAR TOTAL ASSETS TOTAL DEBT RATIO
2005 92,265,728 70718706 1.304686
2006 96,743,566 77099704 1.254785
2007 111,233,769 87475497 1.271599
2008 119,535,896 98504792 1.213503
2009 133,448,746 117638132 1.1344
SOLVENCY RATIO
1
1.05
1.1
1.15
1.2
1.25
1.3
1.35
2005 2006 2007 2008 2009
YEAR
RA
TIO
S
RATIO
INTREPRETATION:
A solvency ratio is used to test the solvency of the firm. Solvency means the
ability to meet the outside liabilities out of total assets. Thus this ratio establishes the
relationship between total assets and outside liabilities. Above table indicate the total
assets are more than the total debt .thus, during the period 2005-2009 shows the solvency
ratio of the firm is satisfactory.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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DEBT EQUITY RATIO
DEBT EQUITY RATIO FROM THE YEAR 2005-2009
YEAR DEBT FUND EQUITY RATIO
2005 70718706 12349174 5.726594
2006 77099704 4970270 15.51218
2007 87475497 5140280 17.01765
2008 98504792 4744500 20.76189
2009 117638132 4744500 24.79463
DEBT EQUITY RATIO
0
5
10
15
20
25
30
2005 2006 2007 2008 2009
YEAR
RA
TIO
S
RATIO
INTERPREATION Debt equity ratio shows an increasing trend during the period (2005-2009).The year 2005
that 5.7shows almost satisfactory ratio that is near to standard ratio. During the period of
study is above standard. Hence the company is not financially sound during these
periods. And this firm is use more debt fund in these years.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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PROPREITORY RATIO
PROPREITORY RATIO FROM THE YEAR 2005-2009
YEAR SHAREHOLDERS FUND TOTAL ASSETS RATIO
2005 12349174 92,265,728 0.133844
2006 4970270 96,743,566 0.051376
2007 5140280 111,233,769 0.046212
2008 4744500 119,535,896 0.039691
2009 4744500 133,448,746 0.035553
PROPRIETARY RATIO
0
0.02
0.04
0.06
0.08
0.1
0.12
0.14
0.16
2005 2006 2007 2008 2009
YEAR
RA
TIO
S
RATIO
INTERPREATION
The above table shows that proprietary ratio of the firm during the year 2005 to 2009 is
not a satisfactory level. In during these years proprietary ratio is below 1. So the long
term solvency position of the firm is not satisfactory in these periods.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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CURRENT ASSETS TO FIXED ASSET RATIO
CURRENT ASSETS TO FIXED ASSET RATIO (2005-2009)
YEAR CURRENT ASSETS FIXED ASSETS RATIO
2005 16044478 16387709 0.979056
2006 11000342 14519759 0.757612
2007 17920383 15121341 1.185105
2008 20221795 17543366 1.152675
2009 22377147 17606912 1.27093
CURRENT ASSET TO FIXED RATIO
0
0.2
0.4
0.6
0.8
1
1.2
1.4
2005 2006 2007 2008 2009
YEAR
RA
TIO
S
RATIO
INTERPREATION
Current assets to fixed assets ratio of the firm during the period of study are
fluctuating. In 2007 and 2008 there is an increase in current assets over fixed assets, so
the current asset is idle in these years.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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FIXED ASSET RATIO
FIXED ASSET RATIO (2005-2009)
YEAR FIXED ASSETS CAPITAL EMPLOYED RATIO
2005 16387709 83,067,880 0.197281
2006 14519759 82,069,974 0.176919
2007 15121341 92,615,777 0.16327
2008 17543366 103,249,292 0.169913
2009 17606912 122,382,632 0.143868
FIXED ASSET RATIO
0
0.05
0.1
0.15
0.2
0.25
2005 2006 2007 2008 2009
YEAR
RA
TIO
RATIO
INTERPREATION
The above table shows that the ratio of the firm is below normal ratio 1:1.The
fixed assets used in firm are not in a good position. But it shows a decreasing trend. In
2005 it is 0.19but in 2009 it decreased to 0.14.This trend is a negative trend for company.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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FIXED ASSET TURN OVER RATIO
FIXED ASSET TURN OVER RATIO (2005-2009)
YEAR SALES AFTER (S/R) FIXED ASSETS RATIO
2005 91,728,364 16387709 5.597388
2006 20,441,236 14519759 1.407822
2007 34,787,928 15121341 2.300585
2008 58,790,047 17543366 3.351127
2009 110,371,284 17606912 6.268634
FIXED ASSET TURN OVER RATIO
0
1
2
3
4
5
6
7
2005 2006 2007 2008 2009
YEAR
RA
TIO
S
RATIO
INTERPREATION
The firm fixed assets turnover ratio during the period of study is above standard
norms. So it indicates that the company hast much efficiency in utilizing its fixed assets
in placing sales.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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WORKING CAPITAL TURN OVER RATIO
WORKING CAPITAL TURN OVER RATIO (2005-2009)
YEAR SALES WORKING CAPITAL RATIO
2005 91,728,364 6846630 13.39759
2006 20,441,236 -3673250 -5.56489
2007 34,787,928 -697609 -49.8674
2008 58,790,047 3935191 14.93957
2009 110,371,284 11311033 9.757843
WORKING CAPITAL TURN OVER RATIO
-60
-50
-40
-30
-20
-10
0
10
20
2005 2006 2007 2008 2009
YEAR
RA
TIO
S
RATIO
INTERPREATION
The firm fixed assets turnover ratio during the period2005 was13.39 above the
standard norm. But in the year 2006-2007 (-5.56to-49.86) study is below standard norms.
But it was increasing above the standard norm in the year 2008-2009.So it indicates that
the company has much efficiency in utilizing its fixed assets in placing sales.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
- - 76 -
CAPITAL TURN OVER RATIO
CAPITAL TURN OVER RATIO (2005-2009)
YEAR SALES CAPITAL EMPLOYED RATIO
2005 91,728,364 83,067,880 1.104258
2006 20,441,236 82,069,974 0.249071
2007 34,787,928 92,615,777 0.375616
2008 58,790,047 103,249,292 0.569399
2009 110,371,284 122,382,632 0.901854
CAPITAL TURN OVERRATIO
0
0.2
0.4
0.6
0.8
1
1.2
2005 2006 2007 2008 2009
YEAR
RA
TIO
S
RATIO
INTERPREATION
The capital turn over ratio was less than one in during the period of study. This ratio
indicates the effectiveness with which the firm utilized its resources or capital employed.
Hence the capital employed was not fully utilized by the firms for earning revenue for
these periods.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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DEBTORS TURN OVER RATIO
DEBTORS TURN OVER RATIO (2005-2009)
YEAR SALES AVG.DEBTORS RATIO
2005 91,728,364 9162167.5 10.01164
2006 20,441,236 11577764 1.76556
2007 34,787,928 15243533 2.282143
2008 58,790,047 19298572.5 3.046342
2009 110,371,284 15229565 7.247172
DEBTORS TURN OVER RATIO
0
2
4
6
8
10
12
2005 2006 2007 2008 2009
YEAR
RA
TIO
S
RATIO
INTERPREATION
The above table shows that the firm’s debt collection period during the year 2005 and
2009 are satisfactory level. But in the year 2006, is below 2 times. But 2009 rate (7.24)
indicates efficient debt collection policy during this period.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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NET PROFIT RATIO
NET PROFIT RATIO(2005-2009)
YEAR NET PROFIT SALES RATIO
2005 -10408999 91,728,364 -11.3476
2006 -11663183 20,441,236 -57.0571
2007 -1040074 34,787,928 -2.98976
2008 -4483443 58,790,047 -7.62619
2009 -1040074 110,371,284 -0.94234
NET PROFIT RATIO
-60
-50
-40
-30
-20
-10
0
2005 2006 2007 2008 2009
YEAR
RA
TIO
RATIO
INTERPRETARION:
Net profit ratio indicates managing the elements efficiency in manufacturing,
administering and selling the product. This is measure of overall profitability. It the ratio
indicates the firms capacity to withstand adverse economic condition. High net ratio
indicates higher overall efficiency of the business, but utilization of limited resources and
reasonable return to owners’ .but the above table shows that the ratio is in negative trend.
This indicates low efficiency and inadequate return to owners
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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COMPARATIVE BALANCE SHEET OF RAIDCO FAMILY CURRY POWDER ON 2005AND 2006
particulars 2005 2006
amount of increase or decrease
percentage of increase or decrease
Fixed Assets 16,387,709 14519759 -1,867,950 -11.39848163
investments 163,200 1638231 1,475,031 903.8180147
Current Assets 16,044,478 11000342 -5,044,136 -31.43845502
Less: current Liabilities 9,197,848 14673592 5,475,744 59.53288204
Working Capital 6,846,630 -3,673,250 -10,519,880 -153.6504821
CAPITAL EMPLOYED 23,397,539 12,484,740 -10,912,799 -46.64079842
Less: Loan Fund 70,718,706 77099704 6,380,998 9.023069511
Add: Profit and loss account 59,670,341 69585234 9,914,893 16.61611587
SHARE HOLDERS FUND 12,349,174 4,970,270 -7,378,904 -59.75220691
Represented by;
share Holders Fund 4,400,000 4,400,000 0 0
Reserve & surplus 7,949,174 570270 -7,378,904 -92.82604708
TOTAL 12,349,174 4,970,270 -7,378,904 -59.75220691
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
- - 80 -
COMPARITIVE BALANCESHEET OF RAIDCO FAMILY CURRY POWDER ON 2006AND 2007
particulars 2006 2007
amount of increase or decrease
percentage of increase or decrease
Fixed Assets 14519759 15121341 601,582 4.14319549
investments 1638231 1665025 26,794 1.635544682
Current Assets 11000342 17920383 6,920,041 62.90750778
Less: current Liabilities 14673592 18617992 3,944,400 26.88094367
Working Capital -3,673,250 -697,609 2,975,641 -81.00839856
CAPITAL EMPLOYED 12,484,740 16,088,757 3,604,017 28.86737729
Less: Loan Fund 77099704 87475497 10,375,793 13.45763014
Add: Profit and loss account 69585234 76527020 6,941,786 9.975946909
SHARE HOLDERS FUND 4,970,270 5,140,280 170,010 3.420538522
Represented by;
share Holders Fund 4,400,000 4,400,000 0 0
Reserve & surplus 570270 740280 170,010 29.81219422
TOTAL 4,970,270 5,140,280 170,010 3.420538522
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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COMPARITIVE BALANCESHEET OF RAIDCO FAMILY CURRY POWDER ON 2007AND 2008
particulars 2007 2008
amount of increase or decrease
percentage of increase or decrease
Fixed Assets 15121341 17543366 2,422,025 16.01726328
investments 1665025 105240 -1,559,785 -93.67937418
Current Assets 17920383 20221795 2,301,412 12.84242641
Less: current Liabilities 18617992 16286604 -2,331,388 -12.52223118
Working Capital -697,609 3,935,191 4,632,800 -664.0969368
CAPITAL EMPLOYED 16,088,757 21,583,797 5,495,040 34.15453413
Less: Loan Fund 87475497 98504792 11,029,295 12.60843937
Add: Profit and loss account 76527020 81665495 5,138,475 6.714589174
SHARE HOLDERS FUND 5,140,280 4,744,500 -395,780 -7.699580568
Represented by;
share Holders Fund 4,400,000 4,400,000 0 0
Reserve & surplus 740280 344500 -395,780 -53.46355433
TOTAL 5,140,280 4,744,500 -395,780 -7.699580568
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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COMPARITIVE BALANCESHEET OF RAIDCO FAMILY CURRY POWDER ON 2008AND 2009
particulars 2008 2009
amount of increase or decrease
percentage of increase or decrease
Fixed Assets 17543366 17606912 63,546 0.362222392
investments 105240 10563273 10,458,033 9937.31756
Current Assets 20221795 22377147 2,155,352 10.65855924
Less: current Liabilities 16286604 11066114 -5,220,490 -32.0538892
Working Capital 3,935,191 11,311,033 7,375,842 187.4328845
CAPITAL EMPLOYED 21,583,797 39,481,218 17,897,421 82.92063255
Less: Loan Fund 98504792 117638132 19,133,340 19.4237657
Add: Profit and loss account 81665495 82901414 1,235,919 1.513391917
SHARE HOLDERS FUND 4,744,500 4,744,500 0 0
Represented by;
share Holders Fund 4,400,000 4,400,000 0 0
Reserve & surplus 344500 344500 0 0
TOTAL 4,744,500 4,744,500 0 0
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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COMMON SIZE BALANCESHEET OF RAIDCO FAMILY CURRY POWDER ON 2005AND 2006
particulars amount percentage of total amount
percentage of total
sources of fund
shareholders fund 4,400,000 4.76883464 4,400,000 4.54810607
reseves and surplus 7,949,174 8.6155219 570270 0.58946556
total shareholders fund 12,349,174 13.3843565 4,970,270 5.13757163
loan fund 70,718,706 76.6467761 77099704 79.6949164
current liability 9,197,848 9.96886731 14673592 15.167512
total liability 92,265,728 100 96,743,566 100
application 0f fund
fixed assets 16,387,709 17.761426 14519759 15.0085009
investment 163,200 0.17688041 1638231 1.69337463
cuurrentassets 16,044,478 17.3894233 11000342 11.3706187
profit and loss account 59,670,341 64.6722703 69585234 71.9275058
total assets 92,265,728 100 96743566 100
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
- - 84 -
COMMON SIZE BALANCESHEET OF RAIDCO FAMILY CURRY POWDER ON 2006AND 2007
particulars amount percentage of total amount
percentage of total
sources of fund
shareholders fund 4,400,000 4.54810607 4,400,000 3.95563329
reseves and surplus 570270 0.58946556 740280 0.66551732
total shareholders fund 4,970,270 5.13757163 5,140,280 4.62115061
loan fund 77099704 79.6949164 87475497 78.6411337
current liability 14673592 15.167512 18617992 16.7377157
total liability 96,743,566 100 111,233,769 100
application 0f fund
fixed assets 14519759 15.0085009 15121341 13.5942
investment 1638231 1.69337463 1665025 1.49687007
cuurrentassets 11000342 11.3706187 17920383 16.1105599
profit and loss account 69585234 71.9275058 76527020 68.79837
total assets 96743566 100 111233769 100
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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COMMON SIZE BALANCESHEET OF RAIDCO FAMILY CURRY POWDER ON 2007AND 2008
amount percentage of total amount
percentage of total
sources of fund
shareholders fund 4,400,000 3.95563329 4,400,000 3.68090268
reseves and surplus 740280 1 344500 0.28819795
total shareholders fund 5,140,280 4.62115061 4,744,500 3.96910063
loan fund 87475497 79 98504792 82.4060348
current liability 18617992 16.7377157 16286604 13.6248646
total liability 111,233,769 100 119,535,896 100
application 0f fund
fixed assets 15121341 13.5942 17543366 14.6762325
investment 1665025 1.49687007 105240 0.0880405
cuurrentassets 17920383 16.1105599 20221795 16.9169226
profit and loss account 76527020 68.79837 81665495 68.3188044
total assets 111233769 100 119535896 100
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
- - 86 -
COMMON SIZE BALANCESHEET OF RAIDCO FAMILY CURRY POWDER ON 2008AND 2009
amount percentage of total amount
percentage of total
sources of fund
shareholders fund 4,400,000 3.68090268 4,400,000 3.29714601
reseves and surplus 344500 0.28819795 344500 0.25815155
total shareholders fund 4,744,500 3.96910063 4,744,500 3.55529755
loan fund 98504792 82.4060348 117638132 88.1522948
current liability 16286604 13.6248646 11066114 8.29240763
total liability 119,535,896 100 133,448,746 100
application 0f fund
fixed assets 17543366 14.6762325 17606912 13.1937635
investment 105240 0.0880405 10563273 7.91560304
cuurrentassets 20221795 16.9169226 22377147 16.7683457
profit and loss account 81665495 68.3188044 82901414 62.1222878
total assets 119535896 100 133448746 100
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TREND ANALYSIS
TREND ANALYSIS OF RAIDCO FAMILY CURRY POWDER FROM THE YEAR 2005-2009
CURRENT ASSETS CURRENT LIABILITY
WORKING CAPITAL
YEAR AMOUNT
%OF TREND AMOUNT
% OF TREND AMOUNT
%OF TREND
2005 1604447
8 100 9197848 100 6846630 100
2006 1100034
2 68.561545 14673592 159.532882 -3673250
-53.650482
1
2007 1792038
3 111.69190
4 18617992 202.416826
2 -697609
-10.189085
7
2008 2022179
5 126.03585
5 16286604 177.069723
3 3935191 57.476320
5
2009 2237714
7 139.46946
1 11066114 120.311990
4 11311033 165.20584
6
TREND ANALYSIS OF RAIDCO FAMILY CURRY POWDER FROM THE YEAR 2005-2009
SALES PURCHASE NET PROFIT
YEAR AMOUNT %OF TREND AMOUNT % OF TREND AMOUNT %OF TREND
2005 91,728,364 100 648,399 100 -10408999 100
2006 20,441,236 22.2845313 278,567 42.96228094 -11663183 112.049036
2007 34,787,928 37.9249411 698,308 107.6972667 -1040074 9.99206552
2008 58,790,047 64.0914592 800,087 123.3942372 -4483443 43.0727585
2009 110,371,284 120.324052 1,847,814 284.9810071 -1040074 9.99206552
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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CHAPTER 5
FINDINGS, SUGGESTIONS AND
CONCLUSION
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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FINDINGS
� The current ratio of the firm indicates ability to meet its short term
debts.
� The firm’s ability to meet its short term obligation out of its liquid
assets.
� The solvency ratio of the firm is satisfactory.
� The company maintains adequate debt funds.
� Company has the efficiency in utilizing its fixed assets.
� Company indicates efficient debt collection policy during the period
2008-2009
� Price fluctuation of raw material is effecting the production
� 80% of cost of production is use to buy raw material
� The capital employed was not fully utilized by the firms for earning
revenue
� The net profit ratio of the company indicates low efficiency and
inadequate return to owners.
� Finally, the over all profitability of the firm is not satisfactory.
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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SUGGESTION:
� Company can collect more equity funds rather than debt funds.
� To maintain the long term solvency position.
� To maintain the resources or capital employed effectively.
� High net profit ratio is only indicates efficiency of business and
adequate return to owners.
� To maintain the records and transaction properly.
� Proper training given to the workers.
� Adequate supply of foods product and distribution network is
necessary.
� Use modern technology for production and distribution
� Proper sale promotion technique use to the supply of the product
� The employees must be given information how to do their work in an
effective manner
� The employees should be allowed to participate in the decision making
process
� Company can appoint very efficient agency to supply the product
A STUDY ON FINANCIAL PERFORMANCE OF RAIDCO
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CONCLUSION
The RAIDCO family curry powder Limited is a leading organization dealing in curry
powder since 1998. The performance of the factory through out the operational period
has not been at all satisfactory. The factory faced losses for the last few years, because of
high cost, negative working capital, less liquidity of money. In order to avoid these
problems, proper management is essential. And also management of cash, working
capital is essential.
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BIBLIOGRAPHY
“Cost and Management Accounting”, P.K.JAIN & K.L.NARANG
“Management Accounting”, ARORA
“Cost and Management Accounting”, A. VINOD
Annual Report of the Andaman Timber Indusries.