Production Operation Management

Kohinoor Textile Mill Limited

Submitted to:
Sir Muzamil
Submitted By:

Aalia Kausar

Roll No
04

1
S NO CONTENTS PAGE NO

Pre-feasibility study
1 4

Introduction of textile sector

2 7

3 Organization summary 8

4 Introduction of organization 10

5 Marketing department 13

6 Marketing process flow 15

7 Production operations 17

8 Process flow of production 17

9 Spinning 18

10 Processing 24

11 27
Dying

2
12 28
Printing

13 Finishing 28

14 28
Stitching

15 Folding & packing section 30

16 Finance department 35

17 Problem facing by company 41

18 Conclusions 41

19 Recommendations: 41

20 References 42

3
 PRE-FEASIBILITY STUDY

FABRIC DYEING & FINISHING UNIT

Executive Summary

Textile is the largest sector and backbone of Pakistan economy. It contributes

more than 60% to the total export earnings, accounts for 46% of the total
manufacturing, 8.5% of total GDP and provides employment to 38% of the
manufacturing labor force of the country.

Due to small number of existing processing units and increased demand of value
added products, this sector has great potential for investments.

Processing includes bleaching, dyeing and finishing of fabric. For the production
of the value added products, dyed fabric is the key element.

Fabric processing can be categorized as woven fabric dyeing and knit fabric
dyeing. The exports of woven and knit garments are contributing a major share in the
total foreign exchange earnings from textile products.

This unit will process fabric on commercial basis meeting the requirement of
export oriented units as well as the manufacturers of apparel and made-ups for supply
to the local market.

Dyes and chemical used for the processing of fabric play a very vital role in the
processing industry and their quality should never be compromised. Normally, imported
dyes are used in the processing industry due to their better quality. Major origins of dyes
into Pakistan are Korea, Japan, China, India and Germany. However local dyes are also
used in Pakistan depending upon the requirement of the customer.

4
 The cost of project has been estimated as Rs.61.150 million including land, civil
works, plant & machinery, office equipment, furniture fixtures and vehicles. This cost
includes preliminary expenses and working capital of Rs.0.350 million and Rs 3.37
million respectively.

The total cost of the project is Rs. 61.150 million including the working capital of
Rs 3.37 million. The sponsors of the project will contribute Rs.36.690 million and the
remaining amount of Rs.24.460 million will be financed by the bank.

Based on the projected financial statements, the returns on the project are as follows:

Project Cost Rs.61.150 million

Internal rate of return on project cost 58.8%
Internal rate of return on equity 91.4%
Payback period (Project) 1.5 years
(Based on cash inflows)

Plant efficiency of 63% has been assumed in the first year of operations, and in
subsequent years, it is assumed at 98% with 20% growth rate. However, plant efficiency
depends upon the local and international market conditions of value added products.

Operational Capacity

In the processing industry, most of the units are working 24 hours and 7 days a week.
Therefore, revenue of this unit is taken on the basis of 360 days. This project has the
capacity of processing 1,200 kg. Fabric and normally it will take 6 hours to complete one
batch of fabric dyeing. As there are 24 hours in a day, therefore this unit will be
completing 4 batches of 4,800 kg fabric processing in one day.
However, plant efficiency depends upon the local and international market conditions of
value added products.

5
 A large quantity of fabric processing would attract economies of scale and would
attract competitive rates of processing from the different dyeing units. On the other
hand, a smaller quantity of fabric would be charged at a higher rate by the processing
units to recover fixed overheads being incurred on processing.

Production
Dyes and chemical used for the processing of fabric play a very vital role in the
processing industry and their quality should never be compromised. Normally, imported
dyes are used in the processing industry due to their better quality. Major origins of dyes
into Pakistan are Korea, Japan, China, India and Germany. However local dyes are also
used in Pakistan depending upon the requirement of the customer.

6
 INTRODUCTION OF TEXTILE SECTOR

Textile Industry in Pakistan

Value addition is the key to success for our country in the current global
economic scenario. With reference to textile industry, Pakistan has been relying on
export of primary products like cotton and yarn.

Pakistani industrialists have started moving in the direction of higher value

addition through investing in the balancing, modernization and replacement of the
machinery, and up-gradation by acquiring new technologies and know how.

Established Capacity

The Textile industry of Pakistan has a total established spinning capacity of 1550
million Kgs of yarn, weaving capacity of 4368 million square meters of fabric and
finishing capacity of 4000 millions square meters. The industry has a production
capacity of 670 million units of garments, 400 million units of knitwear and 53 million
Kgs of towels. The industry has a total of 121 units engaged in ginning and 442 units
engaged in spinning. There are around 124 large units that undertake weaving and 425
small units. There are around 20600 power looms in operation in the industry. The
industry also houses around 10 large finishing units and 625 small units. Pakistans
textiles industry has about 50 large and 2500 small garment manufacturing units.
Moreover, it also housed around 600 knitwear producing units and 400 towel producing
units.

Contribution to Exports

According to recent figures, the Pakistan textile industry contributes more

than60% to the countrys total exports, which amounts to around 5.2 billion
US dollars. The industry contributes around 46% to the total output
produced in the country. In Asia, Pakistan is the 8th largest exporter of textile
products.

Contribution to GDP and Employment

The contribution of this industry to the total GDP is 8 .5%. It provides

employment to 38% of the work force in the country, which amounts to a figure of 15
million. However, the proportion of skilled labor is very less as compared to that of
unskilled labor.

7
 Organization Summary

KTML was established in 1953 at Rawalpindi and is one of the oldest companies
of Pakistan with over 50 years experience in textile manufacturing. It was initially
set up as a spinning and weaving project with 25,000 spindles and 600 looms.

KTML has emerged into a fully vertically integrated home textiles company with
state of the art capabilities for spinning, weaving, dyeing, printing and stitching.

The company has a diverse customer base with sales in both the local and
export markets. The main international markets include Asia, Europe, USA and
Australia

The company started in 1953 as a private limited company and become public
company in 1968

KTM produce home textile on customer order mostly they focus on export of their
product their products are very expensive and Pakistan economic condition is not
stable so they mostly focus on export of their products.

KTML operations are spinning, dyeing, and printing and having power plant that
provide electricity to company.

The company production facilities comprise 156528ring spindles capable of

spinning a wide range of counts using cotton and manmade fibers. The
processing facilities at the Rawalpindi units are capable of dyeing and printing
fabrics for the home textiles for the export market.

They use imported raw material .They import cotton from America, Egypt, Russia
and India for spinning process. They also use local cotton. They import dyeing
colors from china.

KTM has department of quality assurance that assure quality of product .quality
assurance check weekly or monthly departments whether they are working
according to written procedure or not

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 Marketing department is the heart of the KTML. Most of the business is done
through this department. The objective of this department is to gain new contract
and fulfill it at customer satisfaction. This department is responsible for the new
contracts with the foreign customers.

Company sales increased by 27.84% to Rs.14.250 million in 2013(2012; Rs

.11.47 million)

9
 Introduction of Organization

The Kohinoor Maple Leaf Group was born from the trifurcation of the Saigol group of
companies and is a reputable and leading manufacturing of textiles and cement. KTMG
comprises of Kohinoor Textile Mills Limited (KTML) and Maple Cement factory limited
(MLCF). Both companies are incorporated in Pakistan and are listed on three stock
exchanges of the country.

Textiles
KTML was established in 1953 at Rawalpindi and is one of the oldest companies of
Pakistan with over 50 years experience in textile manufacturing. It was initially set up as
a spinning and weaving project with 25,000 spindles and 600 looms. However, after
decades of aggressive expansion and modernization KTML has emerged into a fully
vertically integrated home textiles company with state of the art capabilities for spinning,
weaving, dyeing, printing and stitching. The company has a diverse customer base with
sales in both the local and export markets. The main international markets include Asia,
Europe, USA and Australia.

Cement
Maple Leaf Cement is the third largest cement factory in Pakistan. It was set up in 1956
as a joint collaboration between the West Pakistan Industrial Development Corporation
and the government of Canada. It is strategically located at Daudkhel (District Mianwali)
in Northern Pakistan, which is an area rich in raw materials required for the production
of cement. Kohinoor acquired the ownership and management of Maple Leaf Cement
under the privatization policy of the government of Pakistan in 1992. Presently Kohinoor
Textile Mills is the holding company for Maple Leaf cement.

Board of Directors

Mr. Tariq Sayeed Saigol Chairman

Mr. Taufique Sayeed Saigol Chief Executive
Mr. Sayeed Tariq Saigol
Mr. Waleed Tariq Saigol
Mr. Danial Taufique Saigol
Mr. Zamiruddin Azar
Mr. Arif Ijaz
Syed Mohsin Raza Naqvi

10
Audit Committee
Mr. Zamiruddin Azar Chairman
Mr. Arif Ijaz Member
Mr. Sayeed Tariq Saigol Member
Mr. Waleed Tariq Saigol Member

Auditors

M/s. Riaz Ahmad & Company

Chartered Accountants

Vision
To transform the company into a modern and dynamic yarn, cloth and processed
cloth a n d f i n i s h e d p r o d u c t m a n u f a c t u r i n g c o m p a n y w i t h h i g h l y
p r o f e s s i o n a l s a n d f u l l y equipped to play a meaningful role on sustain able basis
in the economy of Pakistan. To transform the company into a modern and
dynamic power generating company with highly professionals and fully
equipped to play a meaningful role on sustainable basis in the economy of
Pakistan.

Mission
To provide quality products to customers and explore new markets to
promote/expand sales of the company through good governance and foster a
sound and dynamic team, s o a s t o a c h i e v e o p t i m u m p r i c e s o f
p r o d u c t s o f t h e c o m p a n y f o r s u s t a i n a b l e a n d equitable growth and
prosperity of the company

Competition
At international level there are number of suppliers from around the globe who
are exporting the fabrics to other countries with a high quality and at low price. If we
look at Asian countries then their names are mentioned below.

Bangladesh
China
Vietnam
Pakistan
India
Iran

11
These countries are providing the fabric to European countries as well as USA and
African countries. Bangladesh is the only country who is providing best quality of the
fabric.

In local market there are number of units which are competing with each other. There
are 10 big giants of the local market of textile industry of Pakistan and fortunately
KWML is one of them. The major competitors of KWML are:

NISHAT TEXTILE
SAPHIRE TEXTILE
COLONY TEXTILE
YUNIS TEXTILE
AMTEX
CHENAB TEXTILE
AL-KARAM TEXTILE
GULISTAN TEXTILE
FAZAL TEXTILE

Target Market:
In local market, the target customers of KWML are
Upper class and upper middle class of the society
House wives for the ho-textile
Fabrics For garments they are focusing on youngsters and adults
Where as in international market
USA
European countries
Asian countries
Foreign youngsters
Fashion designers

Department of KTML
Marketing dept
Production dept
Finance department
Production planning and control department
Purchase dept
Quality assurance dept
Commercial dept
Human resource dept

12
 Marketing Department

The objective of this department is to gain new contract and fulfill it at customer
satisfaction.

This department is the heart of the KTML. Most of the business is done through this
department. This department is responsible for the new contracts with the foreign
customers. This department supplies them the made-ups and fabrics.

This department deals with the seven regions.

Regions:
1. AUSTERILA+NEWZELAND+HOLLAND.
2. SOUTH AFRICA
3. SCANDINAVINCOUNTRIES+UK.
4. UK+GERMANY.
5. USA+CANADA.(SOUTH AMERICA)
6. MIDDLE EAST.
7. GREACE +SPAIN.

In every organization marketing department plays a vital role for prevail the
organization in the marketing. In Kohinoor the marketing department is also performing
his responsibility for the best of the organization. It is engaged in getting
orders from customer and fulfills the order according to the requirements of
the customer by the follow up of the entire departments

Following procedure is been used:

Inquiry
Customers inquiries are received via e-mails. Customer tells about their specification.

Feasibility and Availability of Goods

Reviews the customers requirements completely before quoting price to customers and
ensure that:
The requirements are adequately defined
Mill has capability to meet the customers desire or requirements.
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 Conformation of raw material in house / from outside.
Send Samples
Marketing Department send the samples to the customer after getting his requirements then customer
send back the sample by some changing required in that sample the marketing department again
generate the sample and send to the customer.

Setting of Price

When the sample is accepted by the customer then marketing department set the price
with customer.

Contract booking
When customer accepts the offer price of products then both parties buyer and seller
signed the contract.

Manufacturing of Order

Then the order is send to the planning department for running in the production department
and the packing requirement is also send by marketing department which is
followed by the packing department.

Shipment of Goods
When the production is ready for the shipment, the marketing sends the request to the
shipping department which makes the shipment of that order.

Quality Assurance

Q.A precedes the samples by spinning, dyeing and boards it according to the
requirement given to them and checks it step by step at each place and at
the end it reached to the marketing department which sends it to the customer.

14
 Marketing Process Flow

Customer

CUSTOMER
NO INQUIRY

Is process
Process
capable?Is
capable? Communication
process
capable?

Sample dispatch Yarn costing and

Price
price Offer
offerYarn
to customer
costing and price
offer

Approval Contract booking

Local Production Export

L/C Requirement
order production order

15
 Quality Dispatch of Quality
monitoring container as per
monitoring
L/C

Further Knitting and

Approval
improvement dyeing of sample

Quality
Production Packing
monitoring

Shipment of Measuring
Godowns customer
consignment
satisfaction

Pre and post

shipment
documents

Feedback to Act on the

customer improvement
opportunities

16
 Production Operations

KTML production operation are spinning, dyeing, and printing and having power plant
that provide electricity to company.

Process Flow of Production

Spinning Weaving Processing

Processed fabric

Dyed Bleached Printed

Made ups

17
Spinning:
The procedure for making "Yarn" is called Spinning. Spinning is a delicate process
because the yarn produced in this process should be exactly of the same quality and
count as specified by the buyer.

Process Flow

Cleaning in
Ginning Mixing in Blow Blow Rooms
Rooms

Comber Drawing Carding

Drawing Simplex Ring

Packing Autocone

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Issuance of Bales
The production process starts from the issuance of cotton bales. Based on the order
(Contract) of yam, an estimate is made for the amount of cotton required for the
process. The cotton is then transferred from one of the Ginning to the Spinning unit or.
When the cotton reaches the unit, the bales are weighted and their moisture is checked.
After that they are shifted to the Cotton Godown. The moisture of cotton bales is again
checked when they are issued for the production process.

Blow Room

Blow Room is the first stage in the making of Yarn. Here there are different machines on

which different activities are performed in order to clean the cotton. So, the basic

objective of this room is to clean the cotton to assure quality in the product.

Process flow

Required
weight per yard
Opening Cleaning
in the form of
LAP

Reduction of
tuft size

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Carding Department

After the blow room, the job of carding department starts. Card is one of the most
important section of the spinning mill. It is called the Heart of spinning mill

In Carding "Slivers" are made. These are long, soft and thick ropes of cotton. These

Slivers are placed in drums called "Cans".

The cotton passed to the "Carding Section" is clean to produce a high quality yam. Here

cleaning the cotton gets different kinds of wastage.

Card is one of the most important sections of the spinning mill. It is called the Heart of
spinning mill. Carding action (single fiber action) takes place here. There are four card
sections in cards about 5% to 6% waste is removed.

Process Flow

Opening of Lap Cleaning, Nep and short

in the form of straightening fibre removal
single fiber and
parallelization

Get the
required weight
per yard in the
form of sliver

20
DRAWING

Drawing is the process where the fibers are blended, straightened and the number of
fibers in the silver reduces in order to achieve the desired linear density in the spinning
process.

Process Flow

Attenuation Parallelization Drafting

Required
weight per yard
in the form of Blending Doubling
sliver.

SIMPLEXING

In the Simpering section the Frames of carded yarn and comber are separately run.

Here, from slivers, "Roving" is made. This is basically thick yarn from which later the

yam with specified counts is made.. These roving are then carried over to the Ring

department.
Roving passes through flyer arm and on pressing bar it goes through pressing eye to
the bobbin. The twist is inserted due to the difference in speed of front rollers and
spindle i.e.

21
Process Flow:

Straightening
and
Drafting Twist insertion
Parallelization

Required
Package weight per yard
formation. in the form of
roving.

Ring Department
Here at the ring department, the yarn with specified count is made. The Bobbins made

in the previous department are carried to this department where these are run

on "Spindles". At spindles the yarn is made which is of the count specified by the

buyer. These Spindles are run in frames.

Process Flow

Drafting
Twist insertion Yarn formation

Package
formation for
auto cone
22
Auto Cone Department
After the yam is made on "Rings", it is carried over to this department which is

called "Auto Cone". Basically in the previous department the yam has been made and

the only objective of this department is to join the yarn and bring it on the cones. The

"Rings" are placed on the machines that draw the yam from them one by one, joins it

and wraps it on the cones.

Packing Department

Here at the Packing dept., the cones are packed.

Yarn Godown

After packing, the yarn is transferred to the Yam Godown. In this Godown, all the record

is kept about the amount of yarn, its quality and the count.
At the time of dispatch the yarn is dispatched from the Godown .

Weaving process
After spinning there is weaving process but KTML is not doing the weaving process that
is shifted to Kohinoor Raiwindmill.KRM produce grey fabric for home textile products.

Weaving process:

INPUT OUTPU

Conversion
Yarn Grey fabric
process

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PROCESSING
The objective of this department is to convert greige fabric in to the finished printed or
dyed fabric through different process

Processing department has different procedure to convert greig into printed or dyed
fabric.

1. Pre treatment
2. Dying.
3. Printing.
4. Finishing.
5. Laboratory

Through these procedures they will able to get finished product at the
requirement of costumer.

Pre treatment
Folding department will issued greig to this department for the initial process. In this
department different process has to be done on the greig fabric.

Process Flow

Rotation
Singing. De-sizing

Mercerizing Bleaching Socuring

Stanter

24
Singing:
Singing is a process in which we burn the protruding fibers and remove the
pilling. After this we will improve the quality of the fabric. Singing is done at both or a
single side and burners position set on the required degree.

De-sizing:
De-sizing is a process in which we de-size the fabric and remove starch from it. Two
type of de-sizing. De-sizing and cold bleach (oxidative de-sizing)

De-sizing is done at the temperature of 70c to 80c. It helps to remove starch from the
fabric and shrink the cloth.

Recipe:
Its up to the fabric quality how much de-sizing agent is used in the gallon/Liter.
1. Wetting agent.
2. Caustic soda.
3. Emulsion.
4. Lusytonse.
These chemical are only used in sing de-size requirement.

Oxidative de-sizing:
Oxidative De-sizing is done at the temperature of 30c to 40c .Its also called as a
cold bleach .

Recipe:
1. Na2 S2 O8 (sodium per sulphate)
2. H2 O2 50%.
3. Stabilizer.
4. Wet agent.
5. Caustic soda.

Padder pressure:

Padder pressure is very important because through this pressure chemical

absorbs in the fabric and extra limit will send back. This pressure is up to the quality of
the fabric.

25
Rotation

The objective of rotation is to gain more observance of the chemical in the fabric in the
required time.

Rotation time:

Rotation time is up to the fabric quality. Maximum 8 to 16 hours is required for rotation.

Scouring and Bleaching

Scouring process is to do more refine fabric .caustic soda and wetting agent is used in
the recipe.

After rotation the beige will bring to the L.BOX machine, where we done the scouring
and bleaching to the fabric.

In this process different fabric has the different speed in meter /minute

In this process fabric will wash in four steps.

At the first step fabric will wash in the temperature of 100c water.

At second step the temperature is 95c.

At the third step the temperature of the water is 90c.

At fourth step the temperature of the water is 70c

These steps are done after the rotation to wash the fabric.

In the next step fabric will come to the Saturator. There is different chemical used for the
different blends, the fabric dip in it and go to the steamer. In the steamer fabric come for
steam for the required time.

After this again washing starts, after steamer the temperature of the washing water is
100c, at the next wash the temperature is 95c and at the second last wash the
temperature is 90c and last has the 80c.

After this fabric went to the dryer and again become in a beige shape and ready
for the next machine.

26
Mercerizing:
To improve the fabric quality through swell the fiber .To improves the quality of dying
and printing.

Sodium hydro oxide 300 to 400 g /L used for the pilling control shining.

Mercerizing is done on the requirement of the customer. Dyied fabric must be

mercerized and for printing it will up to the fabric quality and customer demand. Cotton
and poly cotton fabric is mercerized at different speed steam wash is done to the fabric

Stenter machine:
Batching for printing mercerizing dying,

Finishing for dying and printing (starching).

Heat setting for polyester shrinkage control.

Leuco of polyester is applied on the fabric then the beige will send to the L.Box machine
for the re bleach in the re bleach process the extra leuco will remove from the fabric and
polyester fiber will brighten in look after this the beige will bring to this machine and
cotton leuco is applied on it.

After this process fabric will bring to the next section. If the costumer required for the
dying the fabric will bring to the dying section, and if the costumer required for the
printing the beige will send to the printing section.

Dying

Objective of this department is to dye the fabric up to the requirement of the costumer.

Color matching, shade variation, color and rubbing fastness are this departments
responsibility. Dying department has different kind of dying.

Reactive dying.
Vat dying.
Pigment dying.

Dying department is mostly do dying in reactive dying because it is easy in use and
have good result and have low cost. Reactive dying is applied on the temperature of
102c.pigment dying is use to dying both polyester and cotton

27
Dying department has two types of machine.

Thermo sole dying machine.

Pad steam.

Thermo sole machine has the heat dying system after dipping in the color the fabric is
crossed heat machine (infrared) for dry. After this the fabric will go to the first dryer and
then in the second dryer for the more dryness, after driers fabric will go to the Q.RING
machine for the fixing of the color.

Printing

Printing section do printing up to the requirement of the costumer, they received

beige after pretreatment section. Mostly pigment printings done. They print the design
through screens; mostly 7/11-screen color has been used for printing. Zimmer printing
mechain and Reggiani Rotary printing mostly used mechain in this department.

This department is work to do the work at the requirement of the costumer.

This department is very important because they are printing the fabric if they have some
variation in the design it will occur the big problem, so they will work with intense care.
They are responsible for the exact color mixing because it will occur color variation.

This department is mostly do pigment printing.

Printing department has it s own laboratory .who is make the exact color
which is required for the color.
This department has two printing machine. Zimmer printing machine and
Rotary printing machine.
Zimmer printing machine has the ability to print maximum 12-color design; the operating
system of this machine is manual.
Reggiani rotary printing is the latest computerizes machine that has good result of
printing, it has the ability to print maximum16 color design.
After printing this machine have the dryers to dry the color.
After printing fabric will bring to the stork ager machine for the fixation of the color.

Finishing

The objective of this department is to finish the printed and dyed fabric, it works to
smooth the fabric strong its color .it finish the fabric at the requirement of the customer.

28
There are different machines to finish the fabric.

Stenter machine.
Calander machine.
Monfort machine.
Sunfrize machine.

These machines help to smooth the fabric and fixed the color and reduce the shrinkage.

Stenter machine
This machine works to finish the fabric after printing and dying
Stretching the fabric, heat setting for shrinkage control, lecuo for extra whites.

Calendar machine
This machine works to smooth and shine the fabric, it will press the
fabric.

Monfort machine
This machine is in the folding department this machine also work to
finish the fabric and smooth its surface.

Sunfrize machine
This machine is new addition in the finishing department it has good
result about smoothness and reduces shrinkage.

After these processes the fabric will bring to the folding department who will inspect the
fabric and convert the fabric in to the rolls and pack the fabric up to the requirement of
the customer and finished fabric dispatched for the shipment.

Laboratory
Lab is the important part of processing, it check the quality of the work done in the
different sections through quality control. The lab has done different test.

1. Rubbing test.
2. Color rubbing test.
3. Washing test.
4. Brushing test.
5. Dry cleaning test.

29
Cutting

This department works to cut the fabric issued by the folding department at the
customer demand.

This section has the very importance because they cut the fabric.

They cut the fabric WxL / LxL.

Liner rating.
Cut size.
Fabric converts into the layers.
Each layer has two pieces.
Layer cut on its cut size.
This section gives the cut sizes of different items that required by the customer. They
cut the different items at different sizes.

Single bed set.

Queen bed set.
King bed set.
Super king bed set.

Each set has the normally three sizes. Cutting section is responsible for to cut on these
sizes that is required by the customer.

Every made up has different cut style. They cut on the biases of their cut length and
their leaner rating. Cut length shows from where the fabric cut and liner rating shows
how much fabric is consumed in single piece.

Stitching

This department works to stitch the cloth at the requirements of the customer.

Stitching unit has three sections.

1. Manual section.

This section has the manual transfer of the material. Every worker manually
transfers the material to its position, which is effect on its production.

Over lock machines =18.

Stitching machines =45.

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 Total =63.

Workers =215 to 220.

2. Switch track section.

This department has the switch track system, which help the worker to
generate more items in less time, in this section the fabric switched with the hanger
and he will easily stitch the fabric. This section has the track, which is very effective
from production point of view.

Over lock machines =16.

Lock stitch =78.

Double needle =4.

Total=94.

3. Curtain section.

This section works to make the curtains. They made lined curtains, UN
lined curtains, curtain valance, tiebacks.

Stitching unit stitch different items.

Quilt cover.
Valance sheet.
Fitted valance sheet.
Flat sheet.
Fitted sheet.
Pillowcase.
Each item has the different stitching strike off.

Quilt cover

Two types of quilt covers are stitch in the stitching unit. L shape and U shape, some
quilt covers are the open head and some are the shoulder style. The stitching strike of
the quilt cover is the,

Hem @ lock stitch.

Thoka (Jointing F/R) @ singer.
Over lock 5thread 3side @over lock machine.
Studs @ stud machine.

31
 Fitted valance sheet.

First in the valance sheet valance attach to the flat sheet attach then it will go to
the other machines.

Valance stitch @ lock stitch.

Drop @ over lock.
Gathering @lock stitching.
Complete lock stitching.
Fitted sheet;
Drop@overlock machine.
Gathering and elastic @lock stitch.
Complete lock stitch.
Flat sheet;
Hem 2side, 2cm @lock stitch.
Pocket (if required) 30cm@ lock stitch.
Double needle stitch.

Folding & packing section

The objective of this section is to fold and pack the items at the requirement of the
customer. Every single information about the folding and packing is given by the
customer.

Every section has its own folding and packing sections that are responsible for the
folding and packing.

Types of folding

There is three type of fold.

Book fold;
This type of fold is open from the side, and look like the book. In this type of fold two
stiffeners is used for folding.
U- shape;
In this type of fold two separate sheets are used for fold and open from up side.
Plane;
One sheet is used for the folding. And it is in the single fold

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Gazat of every sheet is different due to size

Size wise striking;

Half fold required no sheet

In u-shape fold Gazat is not in the sheet.

U- Shape folding is done with two separate sheets.

Sheet is also called the stiffener.

Stiffener layer is about 3ply to 5ply.

Packing

After folding packing section will received the fold material and pack it at the
requirement of the customer.
Poly bags
PP and PVC is the two types of the poly bags.

PP; poly poplin

Pvc; poly vinyl chloride.

Customer will require different things,

Make up card; its aside card or a u-shaped card

Photo card;
Safety first; this sticker is to avoid danger for the children.
Dot sticker; this sticker only required one customer.
Bar code; it helps to understand the quality of the single set.
Size sticker; it shows the size of the packed material.
Carton size; if the customer required each carton has limit of sets.
Shipping mark;
Recycling mark; it shows that the material is recyclable

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Curtain folding and packing
Curtain section has its own folding and packing. They normally used book shape and
plane stiffener for folding required by the customer one side white or both side brown.
Each set curtains and tiebacks are included.

Stiffener.
Make up card.
Photo card.
Large size sticker.
Spine sticker.
Rotation dot.
Bar code.
Make up sticker.
Make up sewing sticker.
Poly bags.
Cartons.
Cartons sticker

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 Finance Department

It is very important for the smooth and steady operation of the business, whether it is
small scale or large scale. It is so because in the present days large amount of capital is
needed and one cant provide a huge amount. So financial management refers to those
activates which are essential for searching out the large amount of capital needed for
the smooth operation of business

Finance is being considered as the life of modern business and plays a key role in
business organization because without finance there is nothing to plan and organize,
direct active and control.

Functions of finance department

Following are the main function of finance department

Financial planning
Procurement of funds
Finding out different sources for obtaining funds
Future of forecasting of financial needs
Caring upon negotiation with creditors
Effective utilization of funds

Account department
Accounting department keeps records of transaction and financial affairs. Financial
information is maintained in the form of statement by accounting section.

Account office of mills keeps cash book, petty cash-book, vouchers in its record and
then prepare annual financial statement on the basis of these books.

Double entry system is followed .these financial statement s are prepared mostly for two
parties inside part and outside part.

Management is being considered as the inside party which takes necessary steps for
planning and controlling the future activities on the basis of these statement. While the
outside parties include owners, stockholders, bankers and creditors.

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Functions Of Accounts Department
To keep of cash receipts and payments of company.
To keep ledger accounts and the preparation of trial balance and annual reports
for these ledgers.
To maintain records of fixed asset and their depreciation.
To keep records of wages and salaries of employees.
To prepare various budgets such as production budgets, sales budgets, labor
budgets store budgets and inventories budgets etc.

This section keeps record of all accounting transactions of mill,such as daily

production,receiving raw materials,despathing of goods,excise and custom,store
expences,maintainess and repairs and labour salaries and wages.

Books of Accounts
Following are the main books which are used by the accounts office of KTM

A) journal

This is the book of original entry prepared by the accounts office, while this book is used
for recording, opening closing and adjusting entries.

b) Ledger

Ledger is the book which classifies the accounts which brought from ledger. This ledger
is divided vertically into

Two equal parts. The left hand half is known as debit (Dr) while the right hand half is
known as credit (Cr)

c) Cash book

This is the book of original entry in which all those transactions are recorded which are
related to cash receipts and payments. All cash receipts are recorded on debit side
while all cash payments are recorded on credit side.

d)petty cash book

this is also prepared by account office for recording all smaal sum of money with cashier
to meet all expences such as postage,telegram,stationary and office sundries.

e)voucher record book

this is register prepared by the accounts office for the purporse of recording vouchers

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Preparation of vouchers:
In account department different types of vouchers being prepared and their process of
preparation. Vouchers are written evidence of any business transaction. The different
type of vouchers being prepared by the account department of KTM is as under

Cash payment vouchers

Cash receipts vouchers
Bank payment vouchers
Bank receipt vouchers
Journal voucher or adjustment vouchers
Petty cash vouchers

Cash payment vouchers

Cash payment vouchers are used for recording the expenses. These types of vouchers
are prepared when cash payments are made against small expenses i.e repair;
entertainment etc in order to record the expenses following entry is passed

Account code name of expense (debit) amount

Cash account (credit) amount

Evidence of expense is attached with the cash payment vouchers.

Cash receipt voucher

These types of vouchers are prepared when the cashier on behalf of the ktm is
receiving cash. However these types of vouchers are small in quantity because majority
of transaction are done by bank. On receipt of cash cashier prepared the cash received
slip, account officer prepares voucher on the basis of cash receipt prepared by the
cashier. In order to book the transaction of the following entry is passed in the books.

Account code cash account (debit) amount

Income a/c or receivable a/c (credit) amount

Bank payment vouchers

Being a public limited company the majority of payment transitions of ktm are carried
out through banks. Bills and invoices being approved by the competent authority reach
at the table of account officer for payment. Account officer checks the approval and
mathematical accuracy of the bill and prepares the bank payment voucher .account

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officer first confirms the nature of expense i.e. capital or revenue and deduction of tax if
applicable then pass the following entry

Account code asset name or expense (debit) amount

Bank account (credit) amount

Deduction of tax at source (credit) amount

Evidence of expense /asset is attached with the cash payment voucher.

Bank receipt vouchers

Bank receipt voucher are prepared when mill receive cheques against account
receivable Or advance payments.

One receipt of cheque account officer sends the cheque for clearing and passed the
fowling entry

Account code cheque clearing a/c (debit) amount

Account receivable a/c (credit) amount

Advance against sale a/c (credit) amount

Copy of cheque is attached with voucher.

If the collecting bank the reversal of above entry returns cheque is made in the books

On clearing of above reffered chque following entry passed in the books oof account
officers.

Account code bank a/c (debit) amount

Cheque clearing a/c (credit) amount

Adjustment voucher or journal vouchers

These types of vouchers are generally prepared in the following circumstances

Purchase on credit

Sales on credit

Writing off assets i.e. depreciation store consumption

Rectification of mistakes or omissions

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Purchase on credit

Generally raw material,stores and spares are purchased on credit.in order to account
them

For the journal voucher are prepared by the concerned account officer

Account code purchase a/c (debit) amount

Account payable a/c (credit) amount

Copy of the invoices is attached with vouchers

Sales on credit

Sales (local and export) are made on credit and at the time of delivery of goods
following journal are prepared by the account officer:

Account code account receivable a/c (debit) amount

Credit sales a/c (credit) amount

Copy

Copy of invoice is attached with voucher.

Writing off assets

These journal vouchers are prepared in order to change the assets to expense for the
preparation of monthly accounts

To account for depreciation of fixed assets:

Account code depreciation a/c (debit) amount

Accumulated depreciation a/c (credit) amount

To account for the raw material consumption:

Account code raw material concerned a/c (debit) amount

Raw material store a/c (credit) amount

To account for store consumption:

Account code store concerned a/c (debit) amount

Store and spares a/c (credit) amount
To account for accrued expenses

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 Account code expense a/c (debit) amount
Account payable a/c (credit) amount

In addition to above referred kinds journal voucher is also passed to rectify the mistakes
made in voucher preparation or posting.

Ledger posting

Computer operator make posting in computer. Accounts of ktm are computerized and
ledgers are prepared in computer .after the preparation and coding of voucher it is sent
to computer operator for posting .a daily print out of all entries is checked to check
accuracy. After checking the accuracy the master file is update and posting is made to
respective account ledger by the computer

Finance manger prepares daily cash flows statement in order to determine needs and
utilization of funds

A weekly projected cash flows statement is also prepared in order to determine the
need of the coming week. An account officer prepares bank reconciliation statement of
all the banks and list out the outstanding entries. He then traces the reason for these
entries and put bank reconciliation on the table of finance manager. On receipt of bank
statement the manager prepares cash flow statement and presents it to the finance
director for future action.

Quality of products, customer satisfaction and employee's motivation are the

Company's key areas where management has always taken necessary measures for
improvement. Management has the philosophy to produce and supply the high quality
products to its customers which ensures the maximum satisfaction to the customers.

The Company continues its efforts to achieve debt reduction in order to improve its
long-term liquidity position. During the year Company has paid off its long term debt
totaling to Rs.544 Million and managed to further improve debt equity ratio from 23:77 to
11:89. Management believes that there is no inadequacy in capital structure in status
quo The Company's processing department has already reaped great benefit with the
collaboration of major multinational chemical suppliers who have cooperated with the
production teams to substantially reduce water, chemical and energy usage while
maintaining or improving quality, environmental, and technical standards. The Company
hopes that further progress in these projects will yield substantial reductions in the costs
of energy and other resources like water etc. Further, in anticipation of increased
scarcity and load shedding of natural gas and electricity, the Company is taking steps to
further diversify its energy production capabilities, expanding into steam generation via
wood, coal and bag gas.

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Problem Facing By Company

High cost of electricity generation on furnace and diesel.

Rising raw material prices with reduced profit margins and return for
shareholders
Export sales are becoming more difficult due to sharp increase in the cost of
production
Risk of increase in the cost of borrowing may limit the avenues for availability of
sufficient working capital.

Conclusions
Company facing the problem of high cost of power generation on furnace and diesel but
still company is providing good quality products. KTM improve the operating cyle.ktm
mostly focuses on international customers .KTM has no advertisement strategy just like
its competitors like Nishat and Gul Ahmend. Only focus on international customer make
problem of insufficient working capital .due to insufficient working capital the directors
have passed over dividend payment in 2013.exhange rate fluctuation also affect the
export sales. Increasing competition in textiles from China, India

Recommendations:
Focus on advertisement strategy .advertise in international magazines
KTM should develop new markets.
Explore alternative energy resources.
KTM should also focus on local market.

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Reference:

Kohinoor textile mill limited annual report 2013

Business recorder April 3 2014
www.kmlg.com

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