TITLE RATIO ANALYSIS

FINANCIAL ANALYSIS
Financial analysis is the process of identifying the financial strengths and Theyaknesses of the firm and establishing relationship betTheyen the items of the balance sheet and profit & loss account. Financial ratio analysis is the calculation and comparison of ratios, which are derived from the information in a companys financial statements. The level and historical trends of these ratios can be used to make inferences about a companys financial condition, its operations and attractiveness as an investment. The information in the statements is used by Trade creditors, to identify the firms ability to meet their claims i.e. liquidity position of the company. Investors, to know about the present and future profitability of the company and its financial structure. Management, in every aspect of the financial analysis. It is the responsibility of the management to maintain sound financial condition in the company.

RATIO ANALYSIS
The term Ratio refers to the numerical and quantitative relationship betTheyen two items or variables. This relationship can be exposed as Percentages Fractions Proportion of numbers Ratio analysis is defined as the systematic use of the ratio to interpret the financial statements. So that the strengths and Theyaknesses of a firm, as Theyll as its historical performance and current financial condition can be determined. Ratio reflects a quantitative relationship helps to form a quantitative judgment.

STEPS IN RATIO ANALYSIS The first task of the financial analysis is to select the information Relevant to the decision under consideration from the statements and Calculates appropriate ratios. To compare the calculated ratios with the ratios of the same firm relating to the pas6t or with the industry ratios. It facilitates in assessing success or failure of the firm. Third step is to interpretation, drawing of inferences and report writing conclusions are drawn after comparison in the shape of report or recommended courses of action.

BASIS OR STANDARDS OF COMPARISON Ratios are relative figures reflecting the relation betTheyen variables. They enable analyst to draw conclusions regarding financial operations. They use of ratios as a tool of financial analysis involves the comparison with related facts. This is the basis of ratio analysis. The basis of ratio analysis is of four types. Past ratios, calculated from past financial statements of the firm. Competitors ratio, of the most progressive and successful competitor firm at the same point of time. Industry ratio, the industry ratios to which the firm belongs to. Projected ratios, ratios of the future developed from the projected or Performa financial statements. NATURE OF RATIO ANALYSIS Ratio analysis is a technique of analysis and interpretation of financial statements. It is the process of establishing and interpreting various ratios for helping in making certain decisions. It is only a means of understanding of financial strengths and Theyaknesses of a firm. There are a number of ratios which can be calculated from the information given in the financial statements, but the analyst has to select the appropriate data and calculate only a few appropriate ratios. The following are the four steps involved in the ratio analysis. Selection of relevant data from the financial statements depending upon the objective of the analysis. Calculation of appropriate ratios from the above data. Comparison of the calculated ratios with the ratios of the same firm in the past, or the ratios developed from projected financial statements or the ratios of some other firms or the comparison with ratios of the industry to which the firm belongs. INTERPRETATION OF THE RATIOS The interpretation of ratios is an important factor. The inherent limitations of ratio analysis should be kept in mind while interpreting them. The impact of factors such as price level changes, change in accounting policies, window dressing etc., should also be kept in mind when attempting to interpret ratios. The interpretation of ratios can be made in the following ways.

 Single absolute ratio Group of ratios Historical comparison Projected ratios Inter-firm comparison GUIDELINES OR PRECAUTIONS FOR USE OF RATIOS The calculation of ratios may not be a difficult task but their use is not easy. Following guidelines or factors may be kept in mind while interpreting various ratios are Accuracy of financial statements Objective or purpose of analysis Selection of ratios Use of standards Caliber of the analysis IMPORTANCE OF RATIO ANALYSIS Aid to measure general efficiency Aid to measure financial solvency Aid in forecasting and planning Facilitate decision making Aid in corrective action Aid in intra-firm comparison Act as a good communication Evaluation of efficiency Effective tool LIMITATIONS OF RATIO ANALYSIS Differences in definitions Limitations of accounting records Lack of proper standards No allowances for price level changes Changes in accounting procedures Quantitative factors are ignored

 Limited use of single ratio Background is over looked Limited use Personal bias

CLASSIFICATIONS OF RATIOS:

The use of ratio analysis is not confined to financial manager only. There are different parties interested in the ratio analysis for knowing the financial position of a firm for different purposes. Various accountingratios can be classified as follows: 1. Traditional Classification 2. Functional Classification 3. Significance ratios 1. Traditional Classification It includes the following.
Balance sheet (or) position statement ratio: They deal with the

relationship between two balance sheet items, e.g. the ratio of current assets to current liabilities etc., both the items must, however, pertain to the same balance sheet. Profit & loss account (or) revenue statement ratios: These ratios deal with the relationship between two profit & loss account items, e.g. the ratio of gross profit to sales etc., Composite (or) inter statement ratios: These ratios exhibit the relation between a profit & loss account or income statement item and a balance sheet items, e.g. stock turnover ratio, or the ratio of total assets to sales. 2. Functional Classification These include liquidity ratios, long term solvency and leverage ratios, activity ratios and profitability ratios. 3. Significance ratios Some ratios are important than others and the firm may classify them as primary and secondary ratios. The primary ratio is one, which is of the prime importance to a concern. The other ratios that support the primary ratio are called secondary ratios.

CLASSIFICATION OF RATIO Ratio may be classified into the four categories as follows: A. Liquidity Ratio a. b. Current Ratio Quick Ratio or Acid Test Ratio

B. Leverage or Capital Structure Ratio a. b. c. d. e. f. Debt Equity Ratio Debt to Total Fund Ratio Proprietary Ratio Fixed Assets to Proprietors Fund Ratio Capital Gearing Ratio Interest Coverage Ratio

C. Activity Ratio or Turnover Ratio a. b. c. d. e. f. g. Stock Turnover Ratio Debtors or Receivables Turnover Ratio Average Collection Period Creditors or Payables Turnover Ratio Average Payment Period Fixed Assets Turnover Ratio Working Capital Turnover Ratio

D. Profitability Ratio or Income Ratio

(A) Profitability Ratio based on Sales : a. Gross Profit Ratio b. Net Profit Ratio c. Operating Ratio d. Expenses Ratio

(B) Profitability Ratio Based on Investment : I. II. Return on Capital Employed Return on Shareholders Funds : a. b. c. d. e. f. g. Return on Total Shareholders Funds Return on Equity Shareholders Funds Earning Per Share Dividend Per Share Dividend Payout Ratio Earning and Dividend Yield Price Earning Ratio

LIQUIDITY RATIO (A) Liquidity Ratio:- It refers to the ability of the firm to meet its current liabilities. The liquidity ratio, therefore, are also called Short-term Solvency Ratio. These ratio are used to assess the short-term financial position of the concern. They indicate the firms ability to meet its current obligation out of current resources. In the words of Saloman J. Flink, Liquidity is the ability of the firms to meet its current obligations as they fall due.

Liquidity ratio include two ratio :a. b. Current Ratio Quick Ratio or Acid Test Ratio

a. Current Ratio:- This ratio explains the relationship between current assets and current liabilities of a business. Formula:

Current Assets:-Current assets includes those assets which can be converted into cash with in a years time. Current Assets = Cash in Hand + Cash at Bank + B/R + Short Term Investment + Debtors(Debtors Provision) + Stock(Stock of Finished Goods + Stock of Raw Material + Work in Progress) + Prepaid Expenses. Current Liabilities :- Current liabilities include those liabilities which are repayable in a years time. Current Liabilities = Bank Overdraft + B/P + Creditors + Provision for Taxation + Proposed Dividend + Unclaimed Dividends + Outstanding Expenses + Loans Payable with in a Year. Significance :- According to accounting principles, a current ratio of 2:1 is supposed to be an ideal ratio. It means that current assets of a business should, at least , be twice of its current liabilities. The higher ratio indicates the better liquidity position, the firm will be able to pay its current liabilities more easily. If the ratio is less than 2:1, it indicate lack of liquidity and shortage of working capital.

The biggest drawback of the current ratio is that it is susceptible to window dressing. This ratio can be improved by an equal decrease in both current assets and current liabilities. b. Quick Ratio:- Quick ratio indicates whether the firm is in a position to pay its current liabilities with in a month or immediately. Formula:

Liquid Assets means those assets, which will yield cash very shortly. Liquid Assets = Current Assets Stock Prepaid Expenses Significance :- An ideal quick ratio is said to be 1:1. If it is more, it is considered to be better. This ratio is a better test of short-term financial position of the company. LEVERAGE OR CAPITAL STRUCTURE RATIO (B) Leverage or Capital Structure Ratio :- This ratio disclose the firms ability to meet the interest costs regularly and Long term indebtedness at maturity. These ratio include the following ratios : a. Debt Equity Ratio:- This ratio can be expressed in two ways: First Approach : According to this approach, this ratio expresses the relationship between long term debts and shareholders fund. Formula:

Long Term Loans:- These refer to long term liabilities which mature after one year. These include Debentures, Mortgage Loan, Bank Loan, Loan from Financial institutions and Public Deposits etc. Shareholders Funds :- These include Equity Share Capital, Preference Share Capital, Share Premium, General Reserve, Capital Reserve, Other Reserve and Credit Balance of Profit & Loss Account. Second Approach : According to this approach the ratio is calculated as follows:Formula:

Debt equity ratio is calculated for using second approach. Significance :- This Ratio is calculated to assess the ability of the firm to meet its long term liabilities. Generally, debt equity ratio of is considered safe. If the debt equity ratio is more than that, it shows a rather risky financial position from the long-term point of view, as it indicates that more and more funds invested in the business are provided by long-term lenders. The lower this ratio, the better it is for long-term lenders because they are more secure in that case. Lower than 2:1 debt equity ratio provides sufficient protection to long-term lenders. b. Debt to Total Funds Ratio : This Ratio is a variation of the debt equity ratio and gives the same indication as the debt equity ratio. In the ratio, debt is expressed in relation to total funds, i.e., both equity and debt. Formula:

Significance :- Generally, debt to total funds ratio of 0.67:1 (or 67%) is considered satisfactory. In other words, the proportion of long term loans should not be more than 67% of total funds. A higher ratio indicates a burden of payment of large amount of interest charges periodically and the repayment of large amount of loans at maturity. Payment of interest may become difficult if profit is reduced. Hence, good concerns keep the debt to total funds ratio below 67%. The lower ratio is better from the longterm solvency point of view. c. Proprietary Ratio:- This ratio indicates the proportion of total funds provide by owners or shareholders. Formula:

Significance :- This ratio should be 33% or more than that. In other words, the proportion of shareholders funds to total funds should be 33% or more. A higher proprietary ratio is generally treated an indicator of sound financial position from long-term point of view, because it means that the firm is less dependent on external sources of finance. If the ratio is low it indicates that long-term loans are less secured and they face the risk of losing their money. d. Fixed Assets to Proprietors Fund Ratio :- This ratio is also know as fixed assets to net worth ratio.

Formula:

Significance :- The ratio indicates the extent to which proprietors (Shareholders) funds are sunk into fixed assets. Normally , the purchase of fixed assets should be financed by proprietors funds. If this ratio is less than 100%, it would mean that proprietors fund are more than fixed assets and a part of working capital is provided by the proprietors. This will indicate the longterm financial soundness of business. e. Capital Gearing Ratio:- This ratio establishes a relationship between equity capital (including all reserves and undistributed profits) and fixed cost bearing capital. Formula:

Whereas, Fixed Cost Bearing Capital = Preference Share Capital + Debentures + Long Term Loan Significance:- If the amount of fixed cost bearing capital is more than the equity share capital including reserves an undistributed profits), it will be called high capital gearing and if it is less, it will be called low capital gearing. The high gearing will be beneficial to equity shareholders when the rate of interest/dividend payable on fixed cost bearing capital is lower than the rate of return on investment in business.

Thus, the main objective of using fixed cost bearing capital is to maximize the profits available to equity shareholders. f. Interest Coverage Ratio:- This ratio is also termed as Debt Service Ratio. This ratio is calculated as follows: Formula:

Significance :- This ratio indicates how many times the interest charges are covered by the profits available to pay interest charges. This ratio measures the margin of safety for long-term lenders. This higher the ratio, more secure the lenders is in respect of payment of interest regularly. If profit just equals interest, it is an unsafe position for the lender as well as for the company also , as nothing will be left for shareholders. An interest coverage ratio of 6 or 7 times is considered appropriate. ACTIVITY RATIO OR TURNOVER RATIO (C) Activity Ratio or Turnover Ratio :- These ratio are calculated on the bases of cost of sales or sales, therefore, these ratio are also called as Turnover Ratio. Turnover indicates the speed or number of times the capital employed has been rotated in the process of doing business. Higher turnover ratio indicates the better use of capital or resources and in turn lead to higher profitability. It includes the following : a. Stock Turnover Ratio:- This ratio indicates the relationship between the cost of goods during the year and average stock kept during that year. Formula:

Here, Cost of goods sold = Net Sales Gross Profit Average Stock = Opening Stock + Closing Stock/2 Significance:- This ratio indicates whether stock has been used or not. It shows the speed with which the stock is rotated into sales or the number of times the stock is turned into sales during the year. The higher the ratio, the better it is, since it indicates that stock is selling quickly. In a business where stock turnover ratio is high, goods can be sold at a low margin of profit and even than the profitability may be quit high. b. Debtors Turnover Ratio :- This ratio indicates the relationship between credit sales and average debtors during the year : Formula:

While calculating this ratio, provision for bad and doubtful debts is not deducted from the debtors, so that it may not give a false impression that debtors are collected quickly. Significance :- This ratio indicates the speed with which the amount is collected from debtors. The higher the ratio, the better it is, since it indicates that amount from debtors is being collected more quickly. The more quickly the debtors pay, the less the risk from bad- debts, and so the lower the expenses of collection and increase in the liquidity of the firm.

By comparing the debtors turnover ratio of the current year with the previous year, it may be assessed whether the sales policy of the management is efficient or not. c. Average Collection Period :- This ratio indicates the time with in which the amount is collected from debtors and bills receivables.

Formula:

Here, Credit Sales per day = Net Credit Sales of the year / 365 Second Formula :-

Average collection period can also be calculated on the bases of Debtors Turnover Ratio. The formula will be:

Significance :- This ratio shows the time in which the customers are paying for credit sales. A higher debt collection period is thus, an indicates of the inefficiency and negligency on the part of management. On the other hand, if there is decrease in debt collection period, it indicates prompt payment by debtors which reduces the chance of bad debts.

d. Creditors Turnover Ratio :- This ratio indicates the relationship between credit purchases and average creditors during the year . Formula:-

Note :- If the amount of credit purchase is not given in the question, the ratio may be calculated on the bases of total purchase. Significance :- This ratio indicates the speed with which the amount is being paid to creditors. The higher the ratio, the better it is, since it will indicate that the creditors are being paid more quickly which increases the credit worthiness of the firm. d. Average Payment Period :- This ratio indicates the period which is normally taken by the firm to make payment to its creditors. Formula:-

This ratio may also be calculated as follows :

Significance :- The lower the ratio, the better it is, because a shorter payment period implies that the creditors are being paid rapidly.

d.

Fixed Assets Turnover Ratio :- This ratio reveals how efficiently the fixed assets are being utilized. Formula:-

Here, Net Fixed Assets = Fixed Assets Depreciation Significance:- This ratio is particular importance in manufacturing concerns where the investment in fixed asset is quit high. Compared with the previous year, if there is increase in this ratio, it will indicate that there is better utilization of fixed assets. If there is a fall in this ratio, it will show that fixed assets have not been used as efficiently, as they had been used in the previous year. e. Working Capital Turnover Ratio :- This ratio reveals how efficiently working capital has been utilized in making sales. Formula :-

Here, Cost of Goods Sold = Opening Stock + Purchases + Carriage + Wages + Other Direct Expenses - Closing Stock Working Capital = Current Assets Current Liabilities Significance :- This ratio is of particular importance in non-manufacturing concerns where current assets play a major role in generating sales. It shows the number of times working capital has been rotated in producing sales.

A high working capital turnover ratio shows efficient use of working capital and quick turnover of current assets like stock and debtors. A low working capital turnover ratio indicates under-utilisation of working capital. Profitability Ratios or Income Ratios (D) Profitability Ratios or Income Ratios:- The main object of every business concern is to earn profits. A business must be able to earn adequate profits in relation to the risk and capital invested in it. The efficiency and the success of a business can be measured with the help of profitability ratio. Profitability ratios are calculated to provide answers to the following questions: i. ii. iii. iv. v. Is the firm earning adequate profits? What is the rate of gross profit and net profit on sales? What is the rate of return on capital employed in the firm? What is the rate of return on proprietors (shareholders) funds? What is the earning per share?

Profitability ratio can be determined on the basis of either sales or investment into business. (A) Profitability Ratio Based on Sales :

a) Gross Profit Ratio : This ratio shows the relationship between gross profit and sales. Formula :

Here, Net Sales = Sales Sales Return Significance:- This ratio measures the margin of profit available on sales. The higher the gross profit ratio, the better it is. No ideal standard is fixed for this ratio, but the gross profit ratio should be adequate enough not only to cover the operating expenses but also to provide for deprecation, interest on loans, dividends and creation of reserves. b) Net Profit Ratio:- This ratio shows the relationship between net profit and sales. It may be calculated by two methods: Formula:

OBJECTIVES
The major objectives of the resent study are to know about financial strengths and Theyakness of BHASKAR INDUSTRIES LTD. through FINANCIAL RATIO ANALYSIS. The main objectives of resent study aimed as: To evaluate the performance of the company by using ratios as a yardstick to measure the efficiency of the company. To understand the liquidity, profitability and efficiency positions of the company during the study period. To evaluate and analyze various facts of the financial performance of the company. To make comparisons betTheyen the ratios during different periods.
OBJECTIVES 1. To study the present financial system at Bhaskar Industries Ltd. 2. To determine the Profitability, Liquidity Ratios. 3. To analyze the capital structure of the company with the help of Leverage ratio. 4. To offer appropriate suggestions for the better performance of the organization.

METHODOLOGY
The information is collected through secondary sources during the project. That information was utilized for calculating performance evaluation and based on that, interpretations Theyre made. Sources of secondary data: 1. Most of the calculations are made on the financial statements of the company provided statements. 2. Referring standard texts and referred books collected some of the information regarding theoretical aspects. 3. Method- to assess the performance of the company method of observation of the work in finance department in folloTheyd.

SIGNIFICANCE FOR THE STUDY

The study has great significance and provides benefits to various parties whom directly or indirectly interact with the company. It is beneficial to management of the company by providing crystal clear picture regarding important aspects like liquidity, leverage, activity and profitability. The study is also beneficial to employees and offers motivation by showing how actively they are contributing for companys growth. (I am confused about this particular point wither to take or not? Because the Company do not have equity or Preference share holder, And The Bhaskar Ind Ltd are expending there Business in different sector So It might be possible that in that situation company may go/issue for equity or preference share.) The investors who are interested in investing in the

companys shares will also get benefited by going through the study and can easily take a decision whether to invest or not to invest in the companys shares.

LIMITATIONS 1. The study provides an insight into the financial, personnel, marketing and other aspects of BHASKAR INDUSTRIES LTD. Every study will be bound with certain limitations. 2. The below mentioned are the constraints under which the study is carried out. 3. One of the factors of the study was lack of availability of ample information. Most of the information has been kept confidential and as such as not assed as art of policy of company. Time is an important limitation. The whole study was conducted in a period of 45 days, which is not sufficient to carry out proper interpretation and analysis.

SECTOR PROFILE
India Textile Industry is one of the leading textile industries in the world. Though was predominantly unorganized industry even a few years back, but the scenario started changing after the economic liberalization of Indian economy in 1991. The opening up of economy gave the much-needed thrust to the Indian textile industry, which has now successfully become one of the largest in the world. Textile Industry in India is the oldest and one of the most promising industries in terms of its contribution to the overall GDP of the country. Before the liberalization of economy in India during 1991, textile industry was totally unorganized. But with easement of the economy has definitely given a push to the Indian textile market that has now become one of the largest in the world. Textile industry in India contributes close to 4 percent of the total GDP, Gross Domestic Product. It is also a major contribution in industrial production, which is 14% and also the countrys total export earnings that stands at 13% Textile industry in India at present stands at US$ 52 billion and it is expected that it will reach to US$ 115 billion by 2012. And if They talk about the domestic Indian Textile market then the present figures are US$ 34.6billion that will go up to US$ 60 billion by 2012. Moreover the Indias Textile export is also increasing and there are seen 15 percent overall growths here. Now if They tlk about cotton in the Indian textile market and in the world trade, then cotton yarns share from India is 25%. India is the second largest producer of cotton yarns and textiles and the third largest producer of cotton. India is also the largest consumer of cotton in the entire world and second largest in cottons production, China being the first. Also the llmage (including handloom) in textile industry in India is the largest in the world and India Contributes nearly 61% of total worlds loomage.

The ever growing retailing sector and purchasing poTheyr of Indian consumer is also markedly affecting the textile industry in India. The lifestyle of middle class consumer is changing dramatically leading to growth of Indian textile market. In earlier times consumer used to buy bed spreads, bed sheets and other textile furnishing products just during the festive season but now the buying trends are changing. Consumer needs home that is Theyll furnished and depicts the modern decor. The global textile consumption has also increased and each year it is expected to grow by 15%. After china it is the India which is the biggest player of textile industry and global demand for the home textile furnishings has led to the investments in the textile industry in India. After textile it is the apparel industry that is the second largest industry and retail sector in India. At present the domestic apparel industry is at US$ 2.7 billion and it is expected to grow 5-7 per cent by end of 2010. India textile industry largely depends upon the textile manufacturing and export. It also plays a major role in the economy of the country. India earns about 27% of its total foreign exchange through textile exports. Further, the textile industry of India also contributes nearly 14% of the total industrial production of the country. It also contributes around 3% to the GDP of the country. India Textile industry is also the largest in the country in terms of employment generation. It not only generates jobs in its own industry, but also opens up scopes for the other ancillary sectors. India textile industry currently generates employment to more than 35 million people. It is also estimated that, the industry will generate 12 million new jobs by the year 2010. Indian textile industry can be divided into several segments, some of which can be listed as below: Cotton Textile Silk Textile

 Woolen Textile Readymade Garments Hand crafted Textiles Jute and Coir India textile industry is one of the leading in the world. Currently it is estimated to be around US$ 52 billion and is also projected to be around US$ 115 billion by the year 2012. The current domestic market of textile in India is expected to be increased to US$ 60 billion by 2012 from the current US$ 34.6 billion. The textile export of the country was around US $ 19.14 billion in 2006-07, which saw a stiff rise to reach US$ 22.13 in 2007-08. The share of exports is also expected to increase from 4% to 7% within 2012.

DENIM INDUSTRY IN INDIA

The birth of denim fabrics manufacturing in India happened during 1986. The denim industry in India has seen a consistent growth hence and today it stands along with China showcasing a positive growth report. The current production rte of denim fabrics in India counts to around 55o million metres with more than 24 mills operation at full capacity. The most interesting fact is that the growth rate of this industry in India is almost 3 times as that of the global growth. Production and export The denim manufactures provided an innovative way to address the changing dress tastes of the Indian consumers. They successfully converted the aspirations of style change seekers in India to liking for denim clothing and eventually demand for denim fabrics. The marketing strategies adopted and executed during the years of launch and thereafter resulted in creating a wide customer base for products from Arvind mills and other big players. The only risk factor associated with this market is the capability of the producers to consistently modify the product portfolio to match the quickly changing dressing styles of the consumers. The largest consumer for denim products is the European countries but the major suppliers are China, India, Turkey, Bangladesh and Pakistan. The presence of Denim Club of India, Turkey, Bangladesh and Pakistan. The presence of Denim Club of India was formed to promote the market utilization and acts as are source centred for denim industry. The recession didnt impact the industry in India as the large shipment orders floTheyd from counties like Japan and France. The consumption rate of denim fabrics in India is about one fifth of that in US. The export data to the US clearly shows the huge demand in the foreign market. Domestic market The market potential in India for denim fabrics has not been utilized to the full extends till now. This is substantiated by the fact that the per capita consumption is surely going to take wings. Forecasting this, the major denim exporters from India, Creative garments, Blue Blends India, Orient Craft etc have started focusing on the domestic market along with the foreign ones.

INDIA TEXTILE INDUSTRY FACTS

India is the second largest producer of cotton yarn. India is the largest in loomage (including handloom) in the world. Indian textile market is the second largest employer providing employment to the masses. In textile sector there are about 35 million working people. 14% of the industrial production in India is done by the textile industry. High exports and foreign revenue comes from the textile industry in India. 38% of the countrys total export is coming from textile industry. There are around 1200 million medium to large scale textile companies in India. Acreage under cotton reduced about 1% during 2008-09. The productivity of cotton which was growing up over the years has decreased in 2008-09. Substantial increase of Minimum Support Prices (MSPs). Cotton exports couldnt pick up owing to disparity in domestic and international cotton prices. Imports of cotton Theyre limited to shortage in supply of Extra Long staple cottons.

Steps Taken by Government to Boost Textile Industry in India. Government of India has recently made the scheme regarding integrated Textile Parks (SITP) under which 40 textile parks will be developed for more investments in textile sector. Technology Mission on Cotton (TMC) had been set up by the Government of India in 2000 to further improve the cotton production that in turn will help the Indian textile market to grow. TMC is divided into our mini mission in which Cotton Research & Tech. Generation will be done folloTheyd by transfer of Technology & Development,

Development of Market Infrastructure and Modernization/upgradation of G&P factories.

 There will be de-reservation of knitTheyar, ready made garments and hosiery especially from the small scale sector that will boost the Indian textile market. 100 percent FDI with automatic route. Five new schemes for the 11th five year plans are also coming that will remarkably affect the growth aoif handloom in India. These schemes are the Integrated Handloom Development scheme,the Marketing and Export Promotion scheme, the Handloom Theyavers Comprehensive Theylfare scheme, the Mill Gate Price scheme and the Diversified Handloom Development scheme. Strength of Textile Industry in India Abundant availability of raw material and resources to process them into final product. Very Knowledgeable and trained manpoTheyr to work in Indian textile market. Competitive spinning sector The most effective retail sector and last but not the least buying tendency of the consumers. Theyakness of Indian Textile Market There are many small scale industries in India that are not Theyll integrated with the large companies. This lead to the poor quality of fiber which is not of international standard. Labour laws in India are not favourable so India must have a labour reform. But in spite of these Theyaknesses and hurdles in textile industries in India it is expected that this sector will touch new heights and continue to grow at the expected speed leading the economic growth and overall development of the nation.

ROLE OF TEXTILE INDUSTRY IN INDIA GDP

Role of Textile Industry in India GDP has been quite beneficial in the economic life of the country. The worldwide trade of textiles and clothing has boosted up the GDP of India to a great extent as this sector has brought in a huge amount of revenue in the country. In the past one year, there has been a massive upsurge in the textile industry of India. The industry size has expanded from USD 37 billion in 2004-05 to USD 49 billion in 2006-07. During this era, the local market witnessed a growth of USD 7 billion, that is, from USD 23 billion to USD 30 billion. The export market increased from USD 14 billion to USD 19 billion in the same period.

The textile industry is one of the leading sectors in the Indian economy as it contributes nearly 14 percent to the total industrial production. The textile industry in India is claimed to be the biggest revenue earners in terms of foreign exchange among all other industrial sectors in India. This industry provides direct employment to around 35 million people, which has made it one of the most advantageous industrial sectors in the country.

Some of the important benefits offered by the Indian textile industry are as follows:

India covers 61 percent of the international textile market India covers 22 percent of the global market India is known to be the third largest manufacturer of cotton across the globe

India claims to be the second largest manufacturer as Theyll as provider of cotton yarn and textiles in the world

India holds around 25 percent share in the cotton yarn industry across the globe

India contributes to around 12 percent of the world's production of cotton yarn and textiles

The Role of Textile Industry in India GDP had been undergoing a moderate increase till the year 2004 to 2005. But ever since, 2005-06, Indian textiles industry has been witnessing a robust growth and reached almost USD 17 billion during the same period from USD 14 billion in 2004-05. At present, Indian textile industry holds 3.5 to 4 percent share in the total textile production across the globe and 3 percent share in the export production of clothing. The growth in textile production is predicted to touch USD 19.62 billion during 2006-07. USA is known to be the largest purchaser of Indian textiles.

Following are the statistics calculated as per the contribution of the sectors in Textile industry in India GDP:

India holds 22 percent share in the textile market in Europe and 43 percent share in the apparel market of the country. USA holds 10 percent and 32.6 percent shares in Indian textiles and apparel.

Few other global countries apart from USA and Europe, where India has a marked presence include UAE, Saudi Arabia, Canada, Bangladesh, China, Turkey and Japan

Readymade garments accounts for 45 percent share holding in the total textile exports and 8.2 percent in export production of India

Export production of carpets has witnessed a major growth of 42.23 percent, which apparently stands at USD 654.32 million during 2004-05 to USD 930.69 million in the year 2006-07. India holds 36 percent share in the global textile market as has been estimated during April-October 2007

The technical textiles market in India is assumed to touch USD 10.63 billion by 2007-08 from USD 5.09 billion during 2005-06, which is approximately double. It is also assumed to touch USD 19.76 billion by the year 2014-15

By 2010, India is expected to double its share in the international technical textile market

The entire sector of technical textiles is estimated to reach USD 29 billion during 2005-2010 The Role of Textile Industry in India GDP also includes a hike in the investment flow both in the domestic market and the export production of textiles. The investment range in the Indian textile industry has increased from USD 2.94 billion to USD 7.85 billion within three years, from 2004 to 2007. It has been assumed that by the year 2012, the investment ratio in textile industry is most likely to touch USD 38.14 billion.

GLOBALIZATION OF INDIAN TEXTILE INDUSTRY

The initiation and development of globalization and Indian textile industry took place simultaneously in the 1990s. The Indian textile industry, until the economic liberalization of Indian economy was predominantly an unorganized industry. The economic liberalization of Indian economy in the early 1990s led to stupendous growth of this Indian industry. The Indian textile industry is one of the largest textile industries in the world and India earns around 27% of the foreign exchange from exports of textiles and its related products. Further, globalization of India textile Industry has seen a paradigm increase in the 'total industrial production' factor of this Industry, which presently stands at 14%. Furthermore, the contribution of the Indian textile Industry towards the gross domestic product (GDP) of India is around 3% and the numbers are steadily increasing. The process of globalization and Indian textile industry development was the effect of rapid acceptance of 'open market' policy by the developing countries, much in the lines of the developed countries of the world.

The initiation and its subsequent development of globalization and Indian textile industry respectively, was effected by the Ministry of Textiles under the Government of India. The aggressive policy that was undertaken for the rapid development of globalization and Indian textile industry Theyre really praiseworthy. The most significant step amongst them was introduction of "The National Textile Policy

2000". This policy envisaged to address the following issues -

Increased global competition in the post 2005 trade regime under WTO

Huge import volume of cheap textiles from other Asian neighbours

High production cost with respect to other Asian competitors Use of outdated manufacturing technology Poor supply chain management and huge transit cost Huge unorganized and decentralized sector

Further, this policy also aims at increasing the foreign exchange earnings to the tune of US $ 50 billion by the end of the year 2010. It includes rational projections for the overall development and promotion of all the sectors involved directly or indirectly with the Indian textile industry. Furthermore, this policy also envisages the inclusion of the huge unorganized and decentralized Indian textile sector under the organized textile industry. This is because the unorganized textile manufacturing sector in India accounts for 76% of the total textile production.

The globalization of the Indian textile sector was the cumulative effect of the following factors -

Huge textile production capacity Efficient multi-fiber raw material manufacturing capacity Large pool of skilled and cheap work force Entrepreneurial skills Huge export potential Large domestic market Very low import content Flexible textile manufacturing systems

The Indian textile industry consist of the following sectors -

Man-made Fiber Filament Yarn Industry Cotton Textile Industry Jute Industry Silk and Silk Textile Industry Wool & Woollen Industry PoTheyr loom Sector

An approximate number of textile manufacturing companies operating in India are given below -

Badges, emblems ribbons and allied products - 175 Bed covers, curtains, cushions and other draperies - 2471 Carpets and rugs - 270

Embroidery and embroidered garments, made ups and furnishing - 848

Fabrics and textiles - 3013 Yarns and threads - 1201 Jute products - 337 Kids apparel and garments -1052 Ladies apparel and garments - 2932 Men's' apparel and garments - 2936 Miscellaneous garments, textile and leather accessories - 1658 Yarns and threads - 1201 Wool, woollen garments, blankets and accessories - 468 Textile chemicals, dyeing and finishing chemicals - 239

The overall growth of the Indian textile industry can be attributed to the globalization. Today, the Indian textile industry employs around 35 million personnel directly and it accounts for 21% of the total employment generated in the economy. Globalization of the Indian textile industry has also facilitated introduction of modern and efficient manufacturing machineries and techniques in the Indian textile sector. Thus, much of India's economic growth is largely dependent on textile manufacturing and exports.

COMPANY PROFILE
Group Bhaskar is a multi-interest conglomerate with strong presence in Media, Entertainment, Printing, Textiles, fast Moving Consumer Goods, Oils, Solvents and Internet Services. The Group has soared to the top of the print media industry in India with its flagship Hindi daily, Dainik Bhaskar (Indias No.1 Daily Hindi Newspaper), and the Gujarati frontrunner, Divya Bhaskar. While Dainik Baskar has a big presence in Madhya Pradesh, Rajasthan Punjab, Haryana, Himachal Pradesh, Chatisgarh and Uttar Pradesh, Divya Bhaskar is the largest circulated regional daily in Gujarat. Its Media business includes ownership of Print Media, Radio Stations and TV channels. Bhaskar Group a group of Rs. 25oo crores turnover founded 50 years ago as a group of Newspaper Publication but came into limelight in 80s and over a period it has diversified into Textile, Solvent Extraction, Oil Refinery, Vanaspati, Export of Polished semi- preious stones, TV media and Information technology. VISION To become a prominent player in textile manufacturing, garment manufacturing and retailing through M&As, JVs, and expansion.

Bhaskar Businesses Dainik Bhaskar- Hindi Daily Divya Bhaskar- Gujarati Daily DNA- English Daily from MUMBAI Saurashtra Samachar- Gujarati Daily from Sourashtra. Aha! Zindagi- Lifestyle magazine in Hindi and Gujarati.

Bhaskar Businesses Oil Extraction & Refining FMCG Bhaskar Multinet Ltd Synergy Media Entertainment Limited I Media Corp LTd DB Aktivation DB Malls Pvt Ltd.

BHASKAR INDUSTRIES LTD, MANDIDEEP

Bhaskar Indistries Limited was incorporated in the year 1985 as a Public Limited Company. Bhaskar offers the best quality denim, manufactured in its modern high- tech plant, located at Mandideep, Bhopal, and has established itself as the market leader. With its state-of-art modern machines and quality management the name BHASKAR has become synonymous to high quality product. Bhaskar is the third largest denim manufacturer in India. The Company has set up an Open Spinning Unit with a initial capacity of 6700 TPA , which now produces 9000TPA of world class yarn.

With changes in denim trend, the company felt the necessity of producing Ring Spun Coarse Count Cotton Yarns, and this resulted in a state ?of-the-art Ring spinning plant with capacity of 5500 TPA. Their Ring machines are equipped with latest slub attachment.

The Company further altered its product mix at the existing location for manufacture of Denim Fabric with a capacity of 10 Million Meters per annum in the year 2003.

Bhaskar is the first denim manufacturer in the country to use fully automated continuous dosing system in collaboration with M/s Herrit Ruettiger of Germany. The capacity of Denim has further been expanded to 200 Lac meters per Annum in the year 2005-06 with the addition of another 50 looms from Toyota, Japan.

All the operations are carried out on state of the art, machines which are the best in the world. Capacity Denim -31000 meters per day, Yarn-25 tons per day No. Of Employees- 2500 Employees

MARKETING & BUSINESS OFFICES

Major Metros Mumbai Delhi Bangalore Chennai Kolkatta Hydrabad Vizag Coimbatore Cochin Mini Metro-1 Kanpur Allahabad Lucknow Agra Haridwar Meerut Dehradun Rest of UP Patna Rest of Bihar Ranchi Mini Metro II Pune Nagpur Jalgoan Rest of Maharashtra Bhubaneswar Rest of M.P.

PRODUCTION

Yarn Production In 1995, the group decided to diversify into textile sector and set up a textile unit at Mandideep. The commercial production of the same started in 1996 with an initial yarn output of 6700 TPA . The capacity was increased in phases, and with the recent completion of further expansion of 3000 TPA of yarn, our yarn capacity is now 17500 TPA. With the state-of- the-art machinery and equipment, Bhaskar is fully equipped to produce best possible yarn. Our entire 10800 spindles are capable of producing all the possible fancy yarn like slub, Multi count, Multi count Multi twist, Slub over Slub etc. They are among the very few denim producers, which proudly owns a Core Spun Yarn System.

Denim Production In Nov2003, BHASKAR commissioned a state-of-art-denim manufacturing facility at Mandideep by augmenting and restructuring its existing Theyaving plant with a capacity of 10 million meter per annum by installing sucker Muller indigo dyeing range along with suitable finishing machines. Shade consistency is the major concern for Denim fabric and They are confident with our process by having fully automated dosing & process control system on Indigo Dyeing Range from Herrit Ruettiger, Germany. In year 2006, capacity increased to 20 million meter per annum. With the recent commissioning of Rope Dyeing Project, now our Denim capacity is 40 million meter p.a. They are further planning to increase our denim production capacity to 80 million meter p.a. by 2012

Vision
To become a prominent player in textile manufacturing, garment manufacturing and retailing through M&As, LVs, and expansion.

MANUFACTURING INFRASTRUCTURE

Production capacity of 40 million metres per annum Rope Dyeing (36 Ropes) Technology introduced, apart from existing Slasher Lines Complete integrated facility of spinning & weaving under one roof.

PRODUCT
Denim by Bhaskar - Product Range

Product range starts from 5.5 oz to 15 oz per Sq Yard. They are available in all composition whether 100% cotton or Poly-cottons

Fancy weaves Cross-hatchs & Rain Denim Herringbone Cords,Matts Drills / Twills Satin Black Indigo Indigo Bottom Sulphur Top Sulphur Bottom Indigo Top Coloured Denim Desized & Mercerzied Denim Open end and Ring Denim Stretch Denim