Sujala pipes (p) ltd., is commissioned with the objective of catering the agricultural needs of the region. A dynamic entrepreneur Sri S.P.Y.Reddy who is basically a mechanical engineer started a unit at Nandyal those manufacturers black pipes. This resulted information of private ltd., company called “Sujala Pipes Pvt. Ltd.,”
In the year 1995 it diversified into other products like milk products mineral water, super market etc., its greatest achievements are taking over sagar pipes in 1997 and monarch pipes in 1999 who are major competitors at that time. At present the major competitors are sudhakar & finolex pipes. It has its market presence in four states in south India (A.P, T.N, Karnataka, and Kerala).
Working capital signifies funds required for day to day business operation of the organization. Working capital management refers to the administration of all aspects of current assests and current liabilities.
It refers to the firm’s investment in current assests. It is defined as excess of current assests over current liabilities. In other words, ‘it is the net current assests or net working capital’
NEED AND IMPORTANCE OF THE STUDY:
Working capital management plays a vital role in any organization and one should have a through knowledge about the working capital position.
In view of this context, I have undertaken this study and it would be a great advantage to the company also to know its working capital.
OBJECTIVES OF THE STUDY:
To find out the working capital position of the company for the last five financial years.
To know the liquidity position of the firm.
To study the profitability of the company
RESEARCH METHODOLOGY :
The data collected from both primary and secondary data.
Primary data has been collected through personal interviews with the financial department and the executives.
Secondary data collected from the records like B/S, income statement and necessary records and website (http://www.nandipipes.com
Confidential matters like financial position, soundness etc, are naturally not disclosed fully. This is certainly set back while drawing the conclusions.
The study is based on five annual reports only. The information
from annual reports is insufficient to calculate few ratios.
Limited time does not allowed to do more analysis.
• The current ratio is mostly constant for first 4 years and highly increased in last year 2006-2007
• The companies net working capiotal turnover ratio is increasing corresponding maximum increase is 16.8
• The working capital ratio is gradually increasing from year after year
The maximum ratio is 0.46
• The cash ratio is gradually reaching the standered norm
The company should keep more current assets such as cash & bank balances short-term investment to meet its increasing liabilities. By that the company can able to have a better liquidity position.
The company has to take necessary steps to establish effective working capital management ( which maintains adequate working capital required for the business). In the view of increasing current liabilities and less allocations of resources towards working capital..
As of now, the company has maintained good financial position by controlling the current liabilities and other expenses, it has suggested that the company should maintain the same performance in the future.
Plastics have becomes synonymous with modern living. It is undoubtedly a product, which has penetrated extensively into the common mans life. No wonder the industry has achieved in terms of supply of raw materials, expansion and diversification of processing capacities and manufacturing of processing machinery and ancillary equipment.
The versatile material with its superior qualities such as light weight, easy process ability, corrosion resistance, energy conservation, non toxicity etc., may substitute to a large extent, many conventional and costly industrial materials like wood, metal, glass, jute, leather etc., on the automobiles, electronics, packaging and agriculture give enough evidence of the immense utility of plastics.
At present 80% of total requirement of raw material and almost all types of plastic machines required for the industry and indigenously available. The present investment in all three segment of the industry, namely production of raw materials, expansion and diversification of processing equipment in Rs.1,250 crores and it provides employment to more than eight lakh people.
Plastics have been subject to level not only at the central, but at state, and local government levels. These levels have affected the price of plastic of production adversely, because of their inherent advantage in properties and versatile in adaptation and use, plastics have come to play a vital role in a variety of applications over the world. In our country, plastics are used in essential consumer goods of daily use for common man such as baskets, shopping bags tiffany boxes, hair combs, tooth brushes, spectacle frames and fountain pens etc., they also find applications in field like packaging and automobiles and transportation, engineering, electronics, telecommunications, defense, medicine, building and other construction plastics and its importance is also growing infield like agriculture and water management.