A GROUP PRESENTATION ON WORKING CAPITAL OF TEXTILE INDUSTRY

Submitted To:edit Master subtitle style Click to Dr. Ashwin Dave Submitted By: Monali Prikh-81 Kinjal Patel-90 Urvi Patel-103
4/8/12

Flow Of Presentation
Introduction Concept of working capital List of the companies Ratio Analysis Graphical presentation of ratios conclusion

Chimanbhai Patel Institute Of Management & Research 4/8/12

Introduction
Definition: According to Hoagland Working capital is a

descriptive of that capital which is not fixed but the more common use of the working capital is as the difference between the book value of current asset and current liabilities.
It is the combination of two words (1) Working (2) capital
4/8/12

Introduction
CONCEPT OF WORKING CAPITAL There are two concept of working capital:

gross and net.

Gross working capital: Net working capital: Significance of working capital:

4/8/12

Circulation system of working capital

4/8/12

List of Company

Arvind mills Bombay dyeing Reliance Siyaram Raymond Chiripal Grasim Welspun Mafatlal
4/8/12

FORMULA-RATIO ANALYSIS
Current Ratio = Current Assets / Current Liabilities D/E Ratio = Long-Term Debt / Shareholders' Equity Long-Term Debt Equity Ratio = Long-Term Debt /

Permanent Capital Average Inventory Debtors

Inventory Turnover Ratio = Cost Of Goods Sold / Debtors Turnover Ratio = Net Credit Sales / Average Total Assets Turnover Ratio = Cost Of Goods Sold /

Average Total Assets

Net Profit Margin (%)= Earnings after Interest and

4/8/12

Graphical Interpretation-Arvind Mills

4/8/12

Graphical Interpretation-Bombay Dyeing

4/8/12

Graphical Presentation-Reliance

4/8/12

Graphical Presentation-Siyaram

4/8/12

Graphical Presentation-Raymond

4/8/12

Graphical presentation-Chiripal

4/8/12

Graphical presentation-Grashim

4/8/12

Graphical presentation-Mafatlal

4/8/12

Graphical presentation-Wellspun

4/8/12

Graphical presentation-Surat textiles

4/8/12

Average of Ratio
CURRENT RATIO D/E RATIO L.T.D/E RATIO INVENTORY RATIO DEBTORS TURNOVER RATIO TOTAL ASSETS RATIO NET PROFIT WORTH

ARVIND MILLS BOMBAY DYEING RELIANCE

2.282

1.394

1.266

4.456

7.728

0.726

1.912

0.938

5.732

3.708

4.456

3.568

0.726

-0.666

1.038

0.502

0.416

9.256

24.434

1.34

10.434

SIYARAM

0.952

1.384

0.64

10.405

5.378

1.842

3.566

RAYMOND

1.292

0.98

0.772

7.162

5.378

0.599

1.992

CHIRIPAL

3.16

2.304

1.754

4.516

4.78

0.538

2.01

GRASHIM

0.864

0.294

0.232

5.726

3.78

0.847

19.068

WELLSPUN

0.894

2.75

2.136

17.98

15,96

0.673

2.158

MAFATLAL

0.812

0.06

0.054

9.27

13.296

1.63

18.354

SURAT TEXTLES

1.982

3.734

3.542

15.32

44.82

2.898

1.944

4/8/12

Conclusion
1). Current ratio (2:1): It shows the relationship between current assets and current liabilities. Chiripal and arvind mills has the highest ratio. It shows the current assets are more than current liability. Grasim has the lowest ratio. 2). Debt-equity ratio(1:1): It express the relationship between the exernal and internal equities or that between the borrowed capital and owners capital. Bombay dyeing has poor condition. While mafatlal has lower ratio which is good sign for the company.

3). Long term D/E ratio: Higher ratio shows the poor condition of the company. Bombay dyeing has poor condition while mafatlal has lowest ratio which is good for the company.

4). Inventory turnover ratio: If the company gets higher ratio then it is benefit for the company. This ratio measures the no. of times the stock turns slows or rotates in an accounting period compared to the sales 4/8/12 effected during the period. Arvind mills and Bombay has higher ratio which is good sign for the company.

WWW.GOOGLE.COM BOOKS:

Bibliography 1. FINANCIAL MANAGEMENT-10TH EDITION;

BY- I M PANDEY 2. FINANCIAL MANAGEMENT-8TH EDITION; BY; PRASANNA CHANDRA

4/8/12

Click to edit Master subtitle style

Thank you

4/8/12