A PROJECT REPORT

ON

A STUDY OF WORKING CAPITAL MANAGEMENT OF ITC LTD. & CUSTOMER PREFERENCE TOWARDS ITC PRODUCT

SUBMITTED FOR
THE PARTIAL FULFILLMENT OF MASTER OF BUSINESS ADMINISTRATION

GUIDED BY:

SUBMITTED BY:

Ms.MONIKA MAM

ABHISHEK KUMAR JAN Roll no. 1032170003 MBA IV Sem.

Translam Institute of Management and Technology

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ACKNOWLEDGEMENT
i take this opportunity to place on record my grateful thanks and gratitude to all those who gave me valuable advice and inputs for my study. My study could not have been completed if I had not been able to get the reference materials from the company. I express my sincere regards to my guide Ms. MONIKA MAM, for support and guidance. Last but not least, I would also like to express my thanks to my family members who inspired me to put in my best efforts for the research / project report.

ABHISHEK KUMAR JAIN

Roll no.1032170003 MBA 4th sem.

PREFACE
The research provides an opportunity to a student to demonstrate application of his/her knowledge. Skill and competencies required during the technical session. Research also helps the student to devote his /her skill to analyze the problem to suggest alternative solution, to evaluate them and to provide feasible recommendations on the provided data. Although I have tried my level best to prepare this report an error free report every effort has been made to offer the most authenticate position with accuracy.

ABHISHEK KUMAR JAIN

DECLARATION
I ABHISHEK KUMAR JAIN student M.B.A. (IV Semester) here by declare that the project report entitled A STUDY OF WORKING CAPITAL MANAGEMENT OF ITC LIMITED & CUSTOMER PREFERENCE TOWARDS ITC PRODUCTS. is my own original work based on the survey undertaken by me. I also declared that this report has not been submitted to any university/ institute for the aware if any professional.

DATE ABHISHEK KUMAR JAIN Roll no. 1032170003

MBA (IV Semester)

INDEX

S.NO. 1.
2.

TITLE INTODUCTION COMPANY PROFILE OBJECTIVE OF STUDY RESEARCH METHODOLOGY

PAGE NO.

3. 4.
5.

DATA ANALYSIS & INTERPRETATION OBSERVATION & FINDINGS CONCLUSION SUGGESTIONS LIMITATION BIBLIOGRAPHY ANNEXURE

6.
7.

8.
9.

10. 11.

INTRODUCTI ON

Introduction Working capital management

Working capital refers to that part of the firms capital which is required for financing short- term or current assets such as cash, marketable securities, debtors & inventories. Funds, thus, invested in current assts keep revolving fast and are being constantly converted in to cash and this cash flows out again in exchange for other current assets. Hence, it is also known as revolving or circulating capital or short term capital. Working capital management is concerned with the problems arise in attempting to manage the current assets, the current liabilities and the inter relationship that exist between them. The term current assets refers to those assets which in ordinary course of business can be, or, will be, turned in to cash within one year without undergoing a diminution in value and without disrupting the operation of the firm. The major current assets are cash, marketable securities, account receivable and inventory. Current liabilities ware those liabilities which intended at there inception to be paid in ordinary course of business, within a year, out of the current assets or earnings of the concern. The basic current liabilities are account payable, bill payable, bank over-draft, and outstanding expenses. The goal of working capital management is to manage the firms current

assets and current liabilities in such way that the satisfactory level of working capital is mentioned. Definition:According to Guttmann & DougallExcess of current assets over current liabilities. According to Park & GladsonThe excess of current assets of a business (i.e. cash, accounts receivables, inventories) over current items owned to employees and others (such as salaries & wages payable, accounts payable, taxes owned to Government). Capital required for a business can be classified under two main categories via, 1) 2) Fixed Capital Working Capital

Every business needs funds for two purposes for its establishment and to carry out its day- to-day operations. Long terms funds are required to create production facilities through purchase of fixed assets such as p&m, land, building, furniture, etc. Investments in these assets represent that part of firms capital which is blocked on permanent or fixed basis and is called fixed capital. Funds are also needed for short-term purposes for the purchase of raw material, payment of wages and other day to- day expenses etc.

CONCEPT OF WORKING CAPITAL There are two concepts of working capital:

1. 2.

Gross working capital Net working capital

The gross working capital is the capital invested in the total current assets of the enterprises current assets are those assets which can convert in to cash within a short period normally one accounting year. CONSTITUENTS OF CURRENT ASSETS 1) 2) 3) 4) 5) Cash in hand and cash at bank Bills receivables Sundry debtors Short term loans and advances Inventories of stock as: a. b. c. d. Raw material Work in process Stores and spares Finished goods

6. Temporary investment of surplus funds. 7. Prepaid expenses 8. Accrued incomes. 9. Marketable securities.

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In a narrow sense, the term working capital refers to the net working. Net working capital is the excess of current assets over current liability, or, say:
NET WORKING CAPITAL = CURRENT ASSETS CURRENT LIABILITIES.

Net working capital can be positive or negative. When the current assets exceeds the current liabilities are more than the current assets. Current liabilities are those liabilities, which are intended to be paid in the ordinary course of business within a short period of normally one accounting year out of the current assts or the income business. CONSTITUENTS OF CURRENT LIABILITIES 1. 2. 3. 4. 5. 6. 7. Accrued or outstanding expenses. Short term loans, advances and deposits. Dividends payable. Bank overdraft. Provision for taxation, if it does not amt. to app. of profit. Bills payable. Sundry creditors.

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CLASSIFICATION OF WORKING CAPITAL Working capital may be classified in to ways: o o On the basis of concept. On the basis of time.

On the basis of concept working capital can be classified as gross working capital and net working capital. On the basis of time, working capital may be classified as: Permanent or fixed working capital. Temporary or variable working capital

Amount of Working Capital Temporary capital

Permanent Capital Time

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PERMANENT OR FIXED WORKING CAPITAL Permanent or fixed working capital is minimum amount which is required to ensure effective utilization of fixed facilities and for maintaining the circulation of current assets. Every firm has to maintain a minimum level of raw material, work- in-process, finished goods and cash balance. This minimum level of current assts is called permanent or fixed working capital as this part of working is permanently blocked in current assets. As the business grow the requirements of working capital also increases due to increase in current assets.

TEMPORARY OR VARIABLE WORKING CAPITAL Temporary or variable working capital is the amount of working capital which is required to meet the seasonal demands and some special exigencies. Variable working capital can further be classified as seasonal working capital and special working capital. The capital required to meet the seasonal need of the enterprise is called seasonal working capital. Special working capital is that part of working capital which is required to meet special exigencies such as launching of extensive marketing for conducting research, etc. Temporary working capital differs from permanent working capital in the sense that is required for short periods and cannot be permanently employed gainfully in the business.

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IMPORTANCE OR ADVANTAGE OF ADEQUATE WORKING CAPITAL

SOLVENCY OF THE BUSINESS:

Adequate working capital helps in maintaining the solvency of the business by providing uninterrupted of production. Goodwill: Sufficient amount of working capital enables a firm to make prompt payments and makes and maintain the goodwill.

Easy loans:

Adequate working capital leads to high solvency and credit standing can arrange loans from banks and other on easy and favorable terms.

Cash Discounts:

Adequate working capital also enables a concern to avail cash discounts on the purchases and hence reduces cost. Regular Supply of Raw Material: Sufficient working capital ensures regular supply of raw material and continuous production.

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 Regular Payment Of Salaries, Wages And Other Day TO Day Commitments: It leads to the satisfaction of the employees and raises the morale of its employees, increases their efficiency, reduces wastage and costs and enhances production and profits. Ability to Face Crises: A concern can face the situation during the depression.

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FACTORS

DETERMINING

THE

WORKING

CAPITAL

REQUIREMENTS 1. NATURE OF BUSINESS: The requirements of working is very limited in public utility undertakings such as electricity, water supply and railways because they offer cash sale only and supply services not products, and no funds are tied up in inventories and receivables. On the other hand the trading and financial firms requires less investment in fixed assets but have to invest large amt. of working capital along with fixed investments. 2. SIZE OF THE BUSINESS: Greater the size of the business, greater is the requirement of working capital. 3. PRODUCTION POLICY: If the policy is to keep production steady by accumulating inventories it will require higher working capital. 4. LENTH OF PRDUCTION CYCLE: The longer the manufacturing time the raw material and other supplies have to be carried for a longer in the process with progressive increment of labor and service costs before the final product is obtained. So working capital is directly proportional to the length of the manufacturing process.

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Sources of working capital

The company can choose to finance its current assets by 1. Long term sources 2. Short term sources 3. A combination of them. Long term sources of permanent working capital include equity and preference shares, retained earning, debentures and other long term debts from public deposits and financial institution. The long term working capital needs should meet through long term means of financing. Financing through long term means provides stability, reduces risk or payment and increases liquidity of the business concern. Various types of long term sources of working capital are summarized as follow: 1. Issue of shares: It is the primary and most important sources of regular or permanent working capital. Issuing equity shares as it does not create and burden on the income of the concern. Nor the concern is obliged to refund capital should preferably raise permanent working capital. 2. Retained earnings: Retain earning accumulated profits are a permanent sources of regular working capital. It is regular and cheapest. It creates not charge on future profits of the enterprises. 3. Issue of debentures:
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It crates a fixed charge on future earnings of the company. Company is obliged to pay interest. Management should make wise choice in procuring funds by issue of debentures. Short term sources of temporary working capital Temporary working capital is required to meet the day to day business expenditures. The variable working capital would finance from short term sources of funds. And only the period needed. It has the benefits of, low cost and establishes closer relationships with banker. Some sources of temporary working capital are given below: 1. Commercial bank: A commercial bank constitutes significant sources for short term or temporary working capital. This will be in the form of short term loans, cash credit, and overdraft and though discounting the bills of exchanges.

2. Public deposits: Most of the companies in recent years depend on this source to meet their short term working capital requirements ranging fro six month to three years. 3. Various credits:
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Trade credit, business credit papers and customer credit are other sources of short term working capital. Credit from suppliers, advances from customers, bills of exchanges, etc helps to raise temporary working capital 4. Reserves and other funds: Various funds of the company like depreciation fund. Provision for tax and other provisions kept with the company can be used as temporary working capital.The company should meet its working capital needs through both long term and short term funds. It will be appropriate to meet at least 2/3 of the permanent working capital equipments form long term sources, whereas the variables working capital should be financed from short term sources. The working capital financing mix should be designed in such a way that the overall cost of working capital is the lowest, and the funds are available on time and for the period they are really required.

SOURCES OF ADDITIONAL WORKING CAPITAL Sources of additional working capital include the following1. Existing cash reserves 2. Profits (when you secure it as cash) 3. Payables (credit from suppliers)

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4. New equity or loans from shareholder 5. Bank overdrafts line of credit 6. Long term loans If we have insufficient working capital and try to increase sales, we can easily over stretch the financial resources of the business. This is called overtrading. Early warning signs include 1. Pressure on existing cash 2. Exceptional cash generating activities. Offering high discounts for clear cash payment 3. Bank overdraft exceeds authorized limit 4. Seeking greater overdrafts or lines of credit 5. Part paying suppliers or there creditor. 6. Management pre occupation with surviving rather than managing. Different Aspects of Working Capital Management Management of Inventory Management of Receivables/Debtors Management of Cash Management of Payables/Creditors MANAGEMENT OF INVENTORY Inventories constitute the most significant part of current assets of a large majority of companies. On an average, inventories are approximately 60% of current assets. Because of large size, it requires a considerable amount of
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fund. The inventory means and includes the goods and services being sold by the firm and the raw material or other components being used in the manufacturing of such goods and services.

Nature of Inventory: The common type of inventories for most of the business firms may be classified as raw-material, work-in-progress, finished goods.

Raw material: it is basic inputs that are converted into finished products through the manufacturing process. Raw materials inventories are those units which have been purchased and stored for future productions. Workinprocess: Work-in-process is semi-manufactured products. They represent products that need more work before them become finished products for sale. Finished goods: These are completely manufactured products which are ready for sale. Stocks of raw materials and work-in-process facilitate production, while stock of finished goods is required for smooth marketing operations. Thus inventories serve as a
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link between the production and consumption of goods.The levels of three kinds of inventories for a firm depend on the nature of business. A manufacturing firm will have substantially high levels of all the three kinds of inventories. While retail or wholesale firm will have a very high level of finished goods inventories and no raw material and work-inprocess inventories.

So operating cycle can be known as following:-

Raw Material

Work Progress
Cash Collection from Debtors

in

Sales
Finished Goods Credit Sales Cash Sales

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Need to hold inventories Maintaining inventories involves trying up of the companys funds and incurrence of storage and holding costs. There are three general motives for holding inventories: Transactions Motive: IT emphasizes the need to maintain inventories to facilitate smooth production and sales operation. Precautionary Motive: It necessitates holding of inventories to guard against the risk of unpredictable changes in demand and supply forces and other factors. Speculative Motive: It influences the decision to increase or reduce inventory levels to take advantage of price fluctuations.

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Management of Receivables/Debtors The Receivables (including the debtors and the bills) constitute a significant portion of the working capital. The receivables emerge whenever goods are sold on credit and payments are deferred by customers. A promise is made by the customer to pay cash within a specified period. The customers from whom receivable or book debts have to be collected in the future are called trade debtors and represents the firms claim or assets. Thus, receivable is s type of loan extended by the seller to the buyer to facilitate the purchase process. Receivable Management may be defined as collection of steps and procedure required to properly weight the costs and benefits attached with the credit policy. The Receivable Management consist of matching the cost of increasing sales (particularly credit sales) with the benefits arising out of increased sales with the objective of maximizing the return on investment of the firm. Nature The term credit policy is used to refer to the combination of three decision variables:

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1. Credit standards: It is the criteria to decide the type of customers to whom goods could be sold on credit. If a firm has more slow paying customers, its investment in accounts receivable will increase. The firm will also be exposed to higher risk of default. 2. Credit terms: It specifies duration of credit and terms of payment by Customer Investment in accounts receivable will be high if customers are allowed extended time period for making payments.

3. Collection efforts: It determine the actual collection period. The lower the collection period, the lower the investment in accounts receivable and vice versa. Management of Cash Cash management refers to management of cash balance and the bank balance and also includes the short terms deposits. Cash is the important current asset for the operations of the business. Cash is the basic input needed to keep the business running on a continuous basis. It is also the ultimate output expected to be realized by selling the service or product manufactured by the firm. The term cash includes coins, currency, and cheque held by the firm and balance in the bank accounts. Factors of Cash Management: Cash management is concerned with the managing of 1. Cash flows into and out of the firm 2. Cash flows within the firm and
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3. Cash balance held by the firm at a point of time by financing deficit or investing surplus cash. Sales generate cash which has to be disbursed out. The surplus cash has to be invested while deficit has to borrow. Cash management seeks to accomplish this cycle at a minimum cost and it also seeks to achieve liquidity and control. Motives of holding cash A distinguishing feature of cash as an asset is that it does not earn any substantial return for the business. Even though firm hold cash for following motives: Transaction motive: Precautionary motive Speculative motives Compensatory motive Transaction motive: This refers to the holding of cash to meet routine cash requirement to finance. The transactions, which a firm carries on in the ordinary course of business. 1.Precautionary motive: This implies the needs to hold cash to meet unpredictable contingencies such as strike, sharp increase in raw materials prices. If a firm can borrow at short notice to pay them unforeseen contingency, it will need to maintain relatively small balances and vice-versa. 2. Speculative motives: It refers to the desire of the firm to take advantage of opportunities which present themselves at unexpected movements and which are typically outside the normal course of business.

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3. Compensatory motive: Bank provides certain services to their client free of cost. They therefore, usually require client to keep minimum cash balance with them to earn interest and thus compensate them for the free service so provided.

Management of Payables/Creditors Creditors are a vital part of effective cash management and should be managed carefully to enhance the cash position. Purchasing initiates cash outflows and an over-zealous purchasing function can create liquidity problems. Consider the Following: Who authorizes purchasing in our company-is it tightly managed or spread among a number of people? Are purchase quantities geared to demand forecasts? Do we use order quantities which take account of stock-holding and purchasing costs? Do we know the cost to the company of carrying stock? Do we have alternative source of supply? How many of ours suppliers have a returns policy? Are we in a position to pass on cost increases quickly through price increase?

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MANAGEMENT OF WORKING CAPITAL Management of working capital is concerned with the problem that arises in attempting to manage the current assets, current liabilities. The basic goal of working capital management is to manage the current assets and current liabilities of a firm in such a way that a satisfactory level of working capital is maintained, i.e. it is neither adequate nor excessive as both the situations are bad for any firm. There should be no shortage of funds and also no working capital should be ideal. WORKING CAPITAL MANAGEMENT POLICES of a firm has a great on its probability, liquidity and structural health of the organization. So working capital management is three dimensional in nature as 1. It concerned with the formulation of policies with regard to profitability, liquidity and risk. 2. It is concerned with the decision about the composition and level of current assets. 3. It is concerned with the decision about the composition and level of current liabilities.

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WORKING CAPITAL ANALYSIS As we know working capital is the life blood and the centre of a business. Adequate amount of working capital is very much essential for the smooth running of the business. And the most important part is the efficient management of working capital in right time. The liquidity position of the firm is totally effected by the management of working capital. So, a study of changes in the uses and sources of working capital is necessary to evaluate the efficiency with which the working capital is employed in a business. This involves the need of working capital analysis. The analysis of working capital can be conducted through a number of devices, such as: 1. 2. 3. Ratio analysis. Fund flow analysis. Budgeting.

METHODS OF WORKING CAPITAL ANALYSIS

There are so many methods for analysis of financial statements but ITC LTD. used the following techniques:-

Comparative size statements

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 Trend analysis Cash flow statement Ratio analysis A detail description of these methods is as follows:COMPARATIVE SIZE STATEMENTS:When two or more than two years figures are compared to each other than we called comparative size statements in order to estimate the future progress of the business, it is necessary to look the past performance of the company. These statements show the absolute figures and also show the change from one year to another.

TREND ANALYSIS:To analyze many years financial statements ITC LTD. uses this method. This indicates the direction on movement over the long time and help in the financial statements. Procedure for calculating trends:1. Previous year is taken as a base year. 2. Figures of the base year are taken 100. 3. Trend % are calculated in relation to base year.

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CASH FLOW STATEMENT:Cash flow statements are the statements of changes in the financial position prepared on the basis of funds defined in cash or cash equivalents. In short cash flow statement summaries the cash inflows and outflows of the firm during a particular period of time.

Benefits for the ITC LTD.:

To prepare the cash budget. To compare the cash budgets . To show the position of the cash and cash equivalents.

RATIO ANALYSIS:Ratio analysis is the process of the determining and presenting the relationship of the items and group of items in the statements. Benefits of ratio analysis to ITC LTD.:1. Helpful in analysis of financial statements. 2. Helpful in comparative study.
3. Helpful in locating the weak spots of the ITC LTD.

4. Helpful in forecasting. 5. Estimate about the trend of the business. 6. Fixation of ideal standards. 7. Effective control.

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8. Study of financial soundness. Types of ratio:-

Liquidity ratio: They indicate the firms ability to meet its current

obligation out of current resources.

Current ratio:Quick ratio:-

Current assets / Current liabilities Liquid assets / Current liabilities

Liquid assets =Current assets Stock -Prepaid expenses

Leverage or Capital structure ratio: This ratio discloses the firms

ability to meet the interest costs regularly and long term solvency of the firm.

Debt equity ratio:- Long term loans / Shareholders funds or net Worth Debt to total fund ratio:- Long terms loans/ share holder funds +long term loan Proprietary ratio:- Shareholders fund/ shareholders fund+long term loan

Activity ratio or Turnover ratio:- They indicate the rapidity with

which the resources available to the concern are being used to produce sales.

Stock turnover ratio:- Cost of good sold/Average stock (Cost of good sold= Net sales/ Gross profit,

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Average stock=Opening stock+closing stock/2)

Debtors turnover ratio:- Net credit sales/ Average debtors +Average B/R Average collection period:- Debtors+B/R /Credit sales per (Credit sales per day=Net credit sales of the year/365)

Creditors Turnover Ratio:- Net credit purchases/ Average Creditors + Average B/P Average Payment Period: - Creditors + B/P/ Credit purchase per day.

Fixed Assets Turnover ratio:- Cost of goods sold/Net fixed Assets (Net Fixed Assets = Fixed Assets depreciation)

Working Capital Turnover Ratio:- Cost of goods sold/ Working Capital (Working capital= current assets current liability)

Profitability Ratios or Income ratios:- The main objective of every business concern is to earn profits. A business must be able to earn adequate profit in relation to the risk and capital invested in it.

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Gross profit ratio:- Gross profit / Net Sales * 100 (Net sales= Sales Sales return)

Net profit Ratio:- Net profit / Net sales * 100 (Operating Net Profit= operating net profit/ Net Sales *100 or operating Net profit= gross profit operating expenses)

Operating Ratio :- Cost of goods sold + Operating expenses/Net Sales * 100

(Cost of goods sold = Net Sales Gross profit, Operating expenses = office & administration expenses + Selling & distribution expenses + discount + bad debts + interest short term loans)

on

Earning per share(E.P.S.) :- Net Profit dividend on preference share / No. of equity shares

Dividend per share (D.P.S.):- Dividend paid to equity share Holders / No. of equity shares *100.

Dividend Payout ratio(D.P.) :- D.P.S. / E.P.S. *100

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COMPANY PROFILE

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ITC is one of India's foremost private sector companies with a market capitalisation of over US $ 22 billion and a turnover of over US $ 5 billion.* ITC is rated among the World's Best Big Companies, Asia's 'Fab 50' and the World's Most Reputable Companies by Forbes magazine, among India's Most Respected Companies by BusinessWorld and among India's Most Valuable Companies by Business Today. ITC ranks among India's `10 Most Valuable (Company) Brands', in a study conducted by Brand Finance and published by the Economic Times. ITC also ranks among Asia's 50 best performing companies compiled by Business Week. ITC has a diversified presence in Cigarettes, Hotels, Paperboards & Specialty Papers, Packaging, Agri-Business, Packaged Foods & Confectionery, Information Technology, Branded Apparel, Personal Care, Stationery, Safety Matches and other FMCG products. While ITC is an outstanding market leader in its traditional businesses of Cigarettes, Hotels, Paperboards, Packaging and Agri-Exports, it is rapidly gaining market share even in its nascent businesses of Packaged Foods & Confectionery, Branded Apparel, Personal Care and Stationery. As one of India's most valuable and respected corporations, ITC is widely

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perceived to be dedicatedly nation-oriented. Chairman Y C Deveshwar calls this source of inspiration "a commitment beyond the market". In his own words: "ITC believes that its aspiration to create enduring value for the nation provides the motive force to sustain growing shareholder value. ITC practices this philosophy by not only driving each of its businesses towards international competitiveness but by also consciously contributing to enhancing the competitiveness of the larger value chain of which it is a part." ITC's diversified status originates from its corporate strategy aimed at creating multiple drivers of growth anchored on its time-tested core competencies: unmatched distribution reach, superior brand-building capabilities, effective supply chain management and acknowledged service skills in hoteliering. Over time, the strategic forays into new businesses are expected to garner a significant share of these emerging high-growth markets in India.

ITC's Agri-Business is one of India's largest exporters of agricultural products. ITC is one of the country's biggest foreign exchange earners (US $ 3.2 billion in the last decade). The Company's 'e-Choupal' initiative is enabling Indian agriculture significantly enhance its competitiveness by empowering Indian farmers through the power of the Internet. This transformational strategy, which has already become the subject matter of a
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case study at Harvard Business School, is expected to progressively create for ITC a huge rural distribution infrastructure, significantly enhancing the Company's marketing reach. ITC's wholly owned Information Technology subsidiary, ITC Infotech India Ltd, provides IT services and solutions to leading global customers. ITC Infotech has carved a niche for itself by addressing customer challenges through innovative IT solutions. ITC's production facilities and hotels have won numerous national and international awards for quality, productivity, safety and environment management systems. ITC was the first company in India to voluntarily seek a corporate governance rating.

ITC employs over 26,000 people at more than 60 locations across India. The Company continuously endeavors to enhance its wealth generating capabilities in a globalising environment to consistently reward more than 3,44,000 shareholders, fulfill the aspirations of its stakeholders and meet societal expectations. This over-arching vision of the company is expressively captured in its corporate positioning statement: "Enduring Value. For the nation. For the Shareholder."

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Vision
Sustain ITC's position as one of India's most valuable corporations through world class performance, creating growing value for the Indian economy and the

Mission
To enhance the wealth generating capability of the enterprise in a globalizing environment, delivering superior and sustainable stakeholder value

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BOARD OF DIRECTOR
The Board of Directors at the apex, as trustee of shareholders, carries the responsibility for strategic supervision of the Company. The strategic management of the Company rests with the Corporate Management Committee comprising the wholetime Directors and members drawn from senior management. The executive management of each business division is vested with the Divisional Management Committee (DMC), headed by the Chief Executive. Each DMC is responsible for and totally focused on the management of its assigned business. This three-tiered interlinked leadership process creates a wholesome balance between the need for focus and executive freedom, and the need for supervision and control.

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C H A I R M A N
Y C Deveshwar

E X E C U T I V E
Anup Singh

D I R E C T O R S
K N Grant

K Vaidyanath

N O N - E X E C U T I V E
A Baijal S H Khan H G Powell Basudeb Sen S Banerjee S B Mathur P B Ramanujam B Vijayaraghavan

D I R E C T O R S
AV Girija Kumar D K Mehrotra Anthony Ruys

D I M A C O

V N M

I S I O N A L A G E M E N T M I T T E E S

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Expand all

| Collapse all

India Tobacco Division Sanjiv Puri H Malik A K Mukerji Foods Division C Dar M Ganesan Paritosh Wali M S Gadhok V L Rajesh S Ganeshkumar
Divisional Chief Executive Member & Secretary Member Member Member Member Divisional Chief Executive Member Member

Lifestyle Retailing Business Division A Chand Riaz Ahmed S Roy K Bose M Rastogi R Kaicker
Divisional Chief Executive Member & Secretary Member Member Member Member

Education & Stationery Products Strategic Business Unit C S Das B K Pramanick Sanjeev Seksaria N Thakur
SBU Chief Executive Member Member Member

Safety Matches Strategic Business Unit

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R Gopal R Ramamurthy B K Pramanick

SBU Chief Executive Member & Secretary Member

Agarbattis Strategic Business Unit V M Rajasekharan Senthil Kumaran B K Pramanick

SBU Chief Executive Member & Secretary Member

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NAME OF ITC PRODUCT

Take an abiding commitment to world-class quality. Add deep market insight; cuttingedge technology; a pervasive culture of innovation. And you have ITC brands that do India proud across a range of products and services: Aashirvaad, Sunfeast, Kitchens of India, mint-o, Candyman, Bingo!, Wills Lifestyle, John Players, Essenza Di Wills, Fiama Di Wills, Vivel Portfolio, Superia, ITC-Welcomgroup, Classmate, Paperkraft, AIM, Mangaldeep.

Cigaretes Foods Lifestyle Personal care Education & stationary

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 Safety Matches Agarbattis

Cigarettes

ITC is the market leader in cigarettes in India. With its wide range of invaluable brands, it has a leadership position in every segment of the market. It's highly popular portfolio of brands includes Insignia, India Kings, Classic, Gold Flake, Silk Cut, Navy Cut, Scissors, Capstan, Berkeley, Bristol and Flake. The Company has been able to build on its leadership position because of its single minded focus on value creation for the consumer through significant investments in product design, innovation, manufacturing technology, quality, marketing and distribution. All initiatives are therefore worked upon with the intent to fortify market
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standing in the long term. This in turns aids in designing products which are contemporary and relevant to the changing attitudes and evolving socio economic profile of the country. This strategic focus on the consumer has paid ITC handsome dividends. ITC's pursuit of international competitiveness is reflected in its initiatives in the overseas markets. In the extremely competitive US market, ITC offers high-quality, value-priced cigarettes and Roll-your-own solutions. In West Asia, ITC has become a key player in the GCC markets through growing volumes of its brands. ITC's cigarettes are produced in its state-of-the-art factories at Bengaluru, Munger, Saharanpur and Kolkata. These factories are known for their high levels of quality, contemporary technology and work environment. ITC has launched its much awaited handrolled cigar, Armenteros, in the Indian market in March 2010. Armenteros cigars have been developed to suit the discerning taste of the Indian cigar connoisseur. The perfect balance of flavour, aroma and taste, Armenteros handrolled cigars are the perfect option for the cigar connoisseur. Armenteros cigars are being sourced from the Dominican Republic, the largest producer of handrolled cigars in the world. The cigars are being manufactured at La Aurora, which is one of the oldest cigar companies in the world and is run by the reputed Leon Jimenes family. The products and

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the packaging are custom-made to ITC specifications and stringent quality parameters. Armenteros is a trademark owned by ITC Limited. Armenteros Handrolled Cigars have a unique blend comprising tobacco from the best growing regions of the world. The exquisite wrapper leaf comes from Cuban seed tobaccos grown in the mountains of Ecuador. This full bodied and aromatic wrapper leaf has a smoothness of texture considered among best in the world. The Sumatra seed, grown in Brazil, is used as the binder. These tobaccos take a great deal of care to mature, but once the leaf reaches its peak maturity, it offers a rich wisp of spicy and sweet flavour to the cigar. The exceptional filler is a masterful blend of tobaccos. The strength and earthiness of the Nicaraguan and Brazilian tobaccos are balanced with the mild yet rich taste of tobaccos from the Dominican Republic and Peru. Expert cigar rollers and robust quality control measures ensure that Armenteros is a truly world class cigar. Armenteros Handrolled Cigars are packed with utmost care. They are placed inside a specially designed wooden box, created with a unique hand crafted inverted curves design and polished till it radiates perfection. The box also carries a Certificate of Authenticity signed by the Master Blender & the Production Director as a pledge to deliver the best products. The Cedar inlayer inside the box compliments the woody and earthy aromas of the cigars. The entire

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packaging design and graphics portray the rich and exclusive Armenteros lineage. Available in the most popular cigar sizes (Churchill, Torpedo, Corona, Petit Corona and Robusto), The Armenteros portfolio consists of 8 pack sizes comprising 3, 5 and 10 cigars. Armenteros cigarswavailableexclusively at tobacco selling outlets in select hotels, fine dining restaurants and exclusive clubs.

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ITC entered the branded Atta market with the launch of Aashirvaad Atta in Jaipur and Chandigarh on 26th May 2002. The product is now available all over India. Aashirvaad atta has further built on its leadership position among the National Branded Players with a market share of 56%. Aashirvaad promises the Indian housewife the joy of providing her family with the most delightful home-made rotis, made from the finest quality atta. ITC uses the sourcing strength of its e-Choupals to buy wheat directly from the farmers to deliver happiness to the Indian consumer Khushiyaan Chun Chun ke (Happiness handpicked). Aashirvaad is made from finest quality wheat that ITC has the unique capability to source through its e-Choupal network. Premium quality atta, made from 100% MP 'sharbati' wheat is also available as Aashirvaad Select Atta . The wheat for Aashirvaad Superior MP Wheat Atta comes from the plush, fertile soil of Madhya Pradesh and then blended using the traditional 'chakki-grinding' method to give the superior, discerning taste ITC Foods also aims to delight the consumer through superior and innovative packaging. The Aashirvaad package is PET Poly, with the design showcasing the farming process undertaken in the rural heartland of India in the form of a Madhubani painting. Aashirvaad Select Atta (5 kg pack) was awarded the World Star Award for Excellence in Packaging in the Consumer Pack Category. This is one of the most prestigious awards in the world for
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Packaging.

The latest offering is Aashirvaad Atta with Multigrains. This new and improved variant is designed to provide nourishment for people of all ages and is an integrated mix of six different grains wheat, soya, channa, oat, maize & psyllium husk which gives a better and healthier option for the consumers. Aashirvaad Atta with Multigrains is an excellent source of vitamins which is vital in strengthening immunity and extra protein content improves body strength. The extra fibre makes food easier to digest and low content of saturated fat keeps the heart smiling all through the day and above all, still retaining the same great taste. This product is available in select cities.

Sunfeast

In July 2003, ITC forayed into the Biscuits market with the Sunfeast range of Glucose, Marie and Cream Biscuits. Sunfeasts brand essence, "Spread the Smile" connotes happiness, contentment, satisfaction and pleasure. The

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mascot Sunny reinforces the emotional aspects of the brand. In a span of 6 years Sunfeast has launched many new varieties and has its presence in almost all types of biscuit categories. Sunfeast Milky Magic Packed with goodness of milk these deliciously nutritious crisp and crunchy biscuits are a favorite among mothers and kids. Milky Magic has the Magic of 2 - A perfect balance of energy that aids physical strength and mental ability. These biscuits strike the right balance of milk and wheat which helps in an all round development and nurturing of the child. Sunfeast Marie Light Sunfeast Marie Light Original : This ideal teatime biscuit is made from the finest quality wheat high in fibre and keeps one light and healthy through the day. Sunfeast Marie Light Orange : It has the distinction of being one of the most successful innovative Marie biscuits and is liked by one and all.

Bingo!

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The launch of Bingo! in March 2007 marked ITC's foray into the fast growing branded snack foods segment. Bingos portfolio includes an array of products in both Potato Chips & Finger Snacks segment. Bingo! is positioned as a youthful and innovative snack, offering the consumers a choice of flavours that are fast becoming

OBJECTIVES OF THE STUDY

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OBJECTIVES OF THE STUDY

To study the working capital management of the concern so as to analyze and interpret the inventory position of the ITC Limited.

To assess the strength and weakness of the concern in various areas. To assess the over all efficiency and performance of the company.

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RESEARCH METHODOLOGY

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RESEARCH METHODOLOGY
This type of analysis helps the management of the company to plan its future polices according to the external environment. Any sound research must have an proper design to achieve the required result, this study id constructed on the basis of descriptive design. The methodology, I have adopted for my study is the various tools, which basically analyze critically financial position of to the organization:

I.

COMMON-SIZE P/L A/C

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COMMON-SIZE BALANCE SHEET COMPARTIVE P/L A/C COMPARTIVE BALANCE SHEET TREND ANALYSIS RATIO ANALYSIS

The above parameters are used for critical analysis of financial position. With the evaluation of each component, the financial position from different angles is tried to be presented in well and systematic manner. By critical analysis with the help of different tools, it becomes clear how the financial manager handles the finance matters in profitable manner in the critical challenging atmosphere, the recommendation are made which would suggest the organization in formulation of a healthy and strong position financially with proper management system. I sincerely hope, through the evaluation of various percentage, ratios and comparative analysis, the organization would be able to conquer its in efficiencies and makes the desired changes.

ANALYSIS OF FINANCIAL STATEMENTS

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FINANCIAL STATEMENTS: Financial statement is a collection of data organized according to logical and consistent accounting procedure to convey an under-standing of some financial aspects of a business firm. It may show position at a moment in time, as in the case of balance sheet or may reveal a series of activities over a given period of time, as in the case of an income statement. Thus, the term financial statements generally refers to the two statements (1) The position statement or Balance sheet. (2) The income statement or the profit and loss Account. OBJECTIVES OF FINANCIAL STATEMENTS: According to accounting Principal Board of America (APB) states The following objectives of financial statements: 1. To provide reliable financial information about economic resources and obligation of a business firm. 2. To provide other needed information about charges in such economic resources and obligation. 3. To provide reliable information about change in net resources (recourses less obligations) missing out of business activities. 4. To provide financial information that assets in estimating the learning 5. potential of the business.

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LIMITATIONS OF FINANCIAL STATEMENTS: Though financial statements are relevant and useful for a concern, still they do not present a final picture a final picture of a concern. The utility of these statements is dependent upon a number of factors. The analysis and interpretation of these statements must be done carefully otherwise misleading conclusion may be drawn. Financial statements suffer from the following limitations: 1. Financial statements do not given a final picture of the concern. The data given in these statements is only approximate. The actual value can only be determined when the business is sold or liquidated. 2. Financial statements have been prepared for different accounting periods, generally one year, during the life of a concern. The costs and incomes are apportioned to different periods with a view to determine profits etc. The allocation of expenses and income depends upon the personal judgment of the accountant. The existence of contingent assets and liabilities also make the statements imprecise. So financial statement are at the most interim reports rather than the final picture of the firm. 3. The financial statements are expressed in monetary value, so they appear to give final and accurate position. The value of fixed assets in the balance sheet neither represent the value for which fixed assets can be sold nor the amount which will be required to replace these assets. The balance sheet is

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prepared on the presumption of a going concern. The concern is expected to continue in future. So fixed assets are shown at cost less accumulated deprecation. Moreover, there are certain assets in the balance sheet which will realize nothing at the time of liquidation but they are shown in the balance sheets. 4. The financial statements are prepared on the basis of historical costs Or original costs. The value of assets decreases with the passage of time current price changes are not taken into account. The statement are not prepared with the keeping in view the economic conditions. the balance sheet loses the significance of being an index of current economics realities. Similarly, the profitability shown by the income statements may be represent the earning capacity of the concern. 5. There are certain factors which have a bearing on the financial position and operating result of the business but they do not become a part of these statements because they cannot be measured in monetary terms. The basic limitation of the traditional financial statements comprising the balance sheet, profit & loss A/c is that they do not give all the information regarding the financial operation of the firm. Nevertheless, they provide some extremely useful information to the extent the balance sheet mirrors the financial position on a particular data in lines of the structure of assets, liabilities etc. and the profit & loss A/c shows the result of operation during

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a certain period in terms revenue obtained and cost incurred during the year. Thus, the financial position and operation of the firm. FINANCIAL STATEMENT ANALYSIS It is the process of identifying the financial strength and weakness of a firm from the available accounting data and financial statements. The analysis is done

CALCULATIONS OF RATIOS Ratios are relationship expressed in mathematical terms between figures, which are connected with each other in some manner.

CLASSIFICATION OF RATIOS Ratios can be classified in to different categories depending upon the basis of classification The traditional classification has been on the basis of the financial statement to which the determination of ratios belongs.

These are: Profit & Loss account ratios Balance Sheet ratios

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Composite ratios

RESEARCH DESIGN
For the proper analysis of data simple statistical techniques such as percentage were use. It helped in making more accurate generalization from the data available.

TOOLS OF ANALYSIS
It is essential to use a systematic research methodology for the assessment of a project because without the use of a research methodology analysis of any company or organization will not be possible.

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In the present analysis mostly secondary data have been used. Its is worth a white to mention that I have used the following types of published data: Balance sheet Profit & Loss A/c Schedules

LIMITATIONS OF THE STUDY

Non monetary aspects are not considered making the results unreliable. Different accounting procedures may make results misleading. In spite of precautions taken there are certain procedural and technical limitations. Accounting concepts and conventions cause serious limitation to financial analysis.

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Lack of sufficient time to exhaust the detail study of the above topic became a hindering factor in my research.

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Data analysis & Interpretation

Data analysis & interpretation:

CURRENT RATIO
CURRENT RATIO = CURRENT ASSETS CURRENT LIABILITES (Rupees in crore) Year Current Assets 2006 81.29 2007 83.12 2008 13,6.57

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Current Liabilities Current Ratio

90 80 70 60 50 40 30 20 10 0

27.42 2.96

20.58 4.03

33.48 4.08

Current Assets Current Liabilities Current Ratio

2006

2007

2008

Interpretation:-

As we know that ideal current ratio for any firm is 2:1. If we see the current ratio of the company for last three years it has increased from 2006 to 2008. The current ratio of company is more than the ideal ratio. This depicts that companys liquidity position is sound. Its current assets are more than its current liabilities.

QUICK RATIO
QUICK RATIO = QUICK ASSETS CURRENT LIABILITES (Rupees in Crore) Year Quick Assets 2006 44.14 2007 47.43 2008 61.55

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Current Liabilities Quick Ratio

70 60 50 40 30 20 10 0 2006

27.42 1.6

20.58 2.3

33.48 1.8

Quick Assets Current Liabilities Quick Ratio

2007

2008

Interpretation :

A quick ratio is an indication that the firm is liquid and has the ability to meet its current liabilities in time. The ideal quick ratio is 1:1. Companys quick ratio is more than ideal ratio. This shows company has no liquidity problem.

ABSOLUTE LIQUID RATIO

ABSOLUTE LIQUID RATIO = ABSOLUTE LIQUID ASSETS CURRENT LIABILITES ABSOLUTE LIQUID ASSETS = CASH & BANK BALANCES. (Rupees in Crore)

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Year Absolute Liquid Assets Current Liabilities Absolute Liquid Ratio

35 30 25 20 15 10 5 0 2006 2007

2006 4.69 27.42 .17

2007 1.79 20.58 .09

2008 5.06 33.48 .15

Absolute Liquid Assets Current Liabilities Absolute Liquid Ratio

2008

Interpretation :

These ratio shows that company carries a small amount of cash. But there is nothing to be worried about the lack of cash because company has reserve, borrowing power & long term investment. In India, firms have credit limits sanctioned from banks and can easily draw cash.

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: INVENTORY TURNOVER OR STOCK TURNOVER RATIO:

INVENTORY TURNOVER RATIO = COST OF GOOD SOLD

AVERAGE INVENTORY AVERAGE STOCK = OPENING STOCK + CLOSING STOCK 2 (Rupees in Crore)

Year Cost of Goods sold Average Stock Inventory Turnover Ratio

2007 110.6 73.59 1.5 times

2008 103.2 36.42 2.8 times

2009 96.8 55.35 1.75 times

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120 100 80 60 40 20 0 2007 2008 2009 Cost of Goods sold Average Stock Inventory Turnover Ratio

Interpretation : These ratio shows how rapidly the inventory is turning into receivable through sales. In 2007 the company has high inventory turnover ratio but in 2008 it has reduced to 1.75 times. This shows that the companys inventory management technique is less efficient as compare to last year.
.

INVENTORY CONVERSION PERIOD:

INVENTORY CONVERSION PERIOD = 365 (net working days) INVENTORY TURNOVER RATIO

Year Days Inventory Turnover Ratio Inventory Conversion Period

400 350 300 250 200 150 100 50 0 2007 2008

2007 365 1.5 243 days

2008 365 2.8 130 days

2009 365 1.8 202 days

Days Inventory Turnover Ratio Inventory Conversion Period

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2009

Interpretation :

Inventory conversion period shows that how many days inventories takes To convert from raw material to finished goods. In the company inventory conversion period is decreasing. This shows the efficiency of management to convert the inventory into cash.

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DEBTORS TURNOVER RATIO:

DEBTORS TURNOVER RATIO = TOTAL SALES (CREDIT) AVERAGE DEBTORS AVERAGE DEBTORS= OPENING DEBTOR+CLOSING DEBTOR 2 Year Sales Average Debtors Debtor Turnover Ratio
200 150 100 50 0 Sales Average Debtors Debtor Turnover Ratio

2007 166.0 17.33 9.6 times

2008 151.5 18.19 8.3 times

2009 169.5 22.50 7.5 times

2007

2008

2009

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Interpretation :

This ratio indicates the speed with which debtors are being converted or turnover into sales. The higher the values or turnover into sales. The higher the values of debtors turnover, the more efficient is the management of credit. But in the company the debtor turnover ratio is decreasing year to year. This shows that company is not utilizing its debtors efficiency. Now their credit policy become liberal as compare to previous year.

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AVERAGE COLLECTION PERIOD:

Average Collection Period = No. of Working Days Debtors Turnover Ratio Average Collection Period = 365 (Net Working Days) Debtors Turnover Ratio Year Days Debtor Turnover Ratio Average Collection Period
400 350 300 250 200 150 100 50 0 2007 2008 2009 Average Collection Period Debtor Turnover Ratio Days

2007 365 9.6 38 days

2008 365 8.3 44 days

2009 365 7.5 49 days

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Interpretation :
The average collection period measures the quality of debtors and it helps in analyzing the efficiency of collection efforts. It also helps to analysis the credit policy adopted by company. In the firm average collection period increasing year to year. It shows that the firm has Liberal Credit policy. These changes in policy are due to competitors credit policy.

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WORKING CAPITAL TURNOVER RATIO:

Working Capital Turnover Ratio = ___Cost of Sales____ Net Working Capital Working Capital Turnover = _______Sales Networking Capital Year Sales Networking Capital Working Capital Turnover
180 160 140 120 100 80 60 40 20 0

2007 166.0 53.87 3.08

2008 151.5 62.52 2.4

2009 169.5 103.09 1.64

Sales Networking Capital Working Capital Turnover

2007

2008

2009

Interpretation :

This ratio indicates low much net working capital requires for sales. In 2008, the reciprocal of this ratio (1/1.64 = .609)

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shows that for sales of Rs. 1 the company requires 60 paisa as working capital. Thus this ratio is helpful to forecast the working capital requirement on the basis of sale.

INVENTORIES
(Rs. in Crores) Year Inventories 2005-2006 37.15 2006-2007 35.69 2007-2008 75.01

80 70 60 50 40 30 20 10 0 Inventories

2005-2006

2006-2007

2007-2008

Interpretation :

Inventories is a major part of current assets. If any company wants to manage its working capital efficiency, it has to manage its inventories efficiently. The graph shows that inventory in 2005-2006 is 45%, in 2006-2007 is 43% and in 2007-2008 is 54% of their current assets. The company should try to reduce the inventory upto 10% or 20% of current assets.

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CASH BNAK BALANCE:

(Rs. in Crores) Year Cash Bank Balance
6 5 4 3 2 1 0 2005-2006 2006-2007 2007-2008 Cash Bank Balance

2005-2006 4.69

2006-2007 1.79

2007-2008 5.05

Interpretation :

Cash is basic input or component of working capital. Cash is needed to keep the business running on a continuous basis. So the organization should have sufficient cash to meet various requirements. The above graph is indicate that in 2006 the cash is 4.69 crores but in 2007 it has decrease to 1.79. The result of that it disturb the firms manufacturing operations. In 2008, it is increased upto approx. 5.1% cash balance. So in 2008, the company has no problem for meeting its requirement as compare to 2007.

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DEBTORS:
(Rs. in Crores) Year Debtors 2005-2006 17.33 2006-2007 19.05 2007-2008 25.94

30 25 20 15 10 5 0 2005-2006 2006-2007 2007-2008 Debtors

Interpretation :

Debtors constitute a substantial portion of total current assets. In India it constitute one third of current assets. The above graph is depict that there is increase in debtors. It represents an extension of credit to customers. The reason for increasing credit is competition and company liberal credit policy.

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CURRENT ASSETS :
(Rs. in Crores) Year Current Assets 2005-2006 81.29 2006-2007 83.15 2007-2008 136.57

140 120 100 80 60 40 20 0 2005-2006 2006-2007 2007-2008 Current Assets

Interpretation :

This graph shows that there is 64% increase in current assets in 2008. This increase is arise because there is approx. 50% increase in inventories. Increase in current assets shows the liquidity soundness of company.

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CURRENT LIABILITY:
(Rs. in Crores) Year Current Liability
35 30 25 20 15 10 5 0 2005-2006 2006-2007 2007-2008 Current Liability

2005-2006 27.42

2006-2007 20.58

2007-2008 33.48

Interpretation : Current liabilities shows company short term debts pay to outsiders. In 2008 the current liabilities of the company increased. But still increase in current assets are more than its current liabilities.

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NET WOKRING CAPITAL:

(Rs. in Crores) Year Net Working Capital 2005-2006 53.87 2006-2007 62.53 2007-2008 103.09

120 100 80 60 40 20 0 2005-2006 2006-2007 2007-2008 Net Working Capital

Interpretation : Working capital is required to finance day to day operations of a firm. There should be an optimum level of working capital. It should not be too less or not too excess. In the company there is increase in working capital. The increase in working capital arises because the company has expanded its business.

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OBSERVATIONS & FINDINGS

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OBSERVATIONS & FINDINGS

As we know that ideal current ratio for any firm is 2:1. If we see the current ratio of the company for last three years it has increased from 2006 to 2008.. This depicts that companys liquidity position is sound. Its current assets are more than its current liabilities.

A quick ratio is an indication that the firm is liquid and has the ability to meet its current liabilities in time. The ideal quick ratio is 1:1. Companys quick ratio is more than ideal ratio. This shows company has no liquidity problem.

Inventory conversion period shows that how many days inventories takes to convert from raw material to finished goods. In the company inventory conversion period is decreasing. This shows the efficiency of management to convert the inventory into cash. This graph shows that there is 64% increase in current assets in 2008. This increase is arise because there is approx. 50% increase in inventories. Increase in current assets shows the liquidity soundness of company.

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 Current liabilities shows company short term debts pay to outsiders. In 2008 the current liabilities of the company increased. But still increase in current assets are more than its current liabilities.

Working capital is required to finance day to day operations of a firm. There should be an optimum level of working capital. It should not be too less or not too excess. In the company there is increase in working capital. The increase in working capital arises because the company has expanded its business.

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CONCLUSION
In the present study I have analyzed the working management of ITC Limited. I found that inventory is increasing which shows that company has sufficient stocks to meet up out production of the company. Inventory Turnover Ratio measures the velocity of conversion of stock into sales. Usually, a high inventory turnover indicates efficient management of inventory because more frequently the stocks are sold, the lesser amount of money is required to finance the inventory. The Inventory Turnover Ratio is decreasing which is not a good sign for the company. The business firm has adequate internal control procedure commensurate with the size of the firm and nature of its business for the purchase of stores, machinery, equipment and other assets and with regards to sale of goods. From the comparative study of inventory turnover it is clear that stock velocity indicates inefficient management of inventory during the year 2009. So the companys performance outlook continues to be positive and optimistic. The company remains confident of delivering of strong operating and financial performance. Efficient stock velocity indicates efficient management of inventory of the firm and no slow movement of the stock due to damaged goods.
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SUGGESTIONS
After interpretation and analysis, I am giving certain suggestions to the company which I hope may be helpful for the company. The company should utilize its stock more efficiently. The company should pay attention towards the proper and efficient utilization of working capital. The company can reduce the time for purchase order. The buffer should be maintained incase of emergency. Insurance should be covered especially fire in case of transit journey also.

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BIBLIOGRAPHY

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BIBLIOGRAPHY
Books: Sharma R.K & Gupta shashi K; Management accounting principles and practice. Eight edition, kalyani publishers New Delhi. Bhalla V.K financial management and policy, first edition, annual publication, New Delhi. Maheshwari S.N ; Management accounting and financial control, thirteen edition, sultan chand & sons, New Delhi. Kothari C.R;Research methodology methods & techniques, second edition, vishwa prakashan Delhi(1990). Gupta Sunita, management of working capital, first edition , New century publications, New Delhi(2003). Chandra Prasana Financial Management, TMH, 4th edition, 1997, New Delhi.

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QUESTIONNAIRE
I am SACHIN PATEL, a student of RAJEEV GANDHI PROUDYOGIKY MAHAVIDYALAYA, Bhopal and this questionnaire is a part of my research on A STUDY OF
WORKING CAPITAL MANAGEMENT OF ITC ltd & CUSTOMER PREFERENCE TOWARDS ITC PRODUCTS .

I would

therefore request you to give your response to the questionnaire.

Name : Sex : Male Age : Upto 20 yrs 21-30 yrs Female

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31-40 yrs Marital Status : Married

40 yrs. and above

Unmarried

Q1. What is the qualification Educational Qualification? Up to HSC Professional Others _____________________________________ Q2. What is your occupation ? Business Employee Home maker Professional Student others Graduation

Q3. what is your Family income (Per/month) Less than Rs.5, 000/Rs. 5,000/- to 10,000/Rs. 10,000/- to 15,000/Above Rs. 15, 000/-

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Q4.) Which Companys products do you use? HLL OTHER ITC

Q5.)

Who influenced you to buy the particular products? Family Member Friends Dealers Neighbors Relations Advertisement

Q6.)

Why do you buy the ITCS products? For business for personal

Q7)

Which type of discount is most preferable by you? Cash discount trade discount

Q8.) What are the reasons of difficulty you face in you ITCS Products Quality Service Price Guaranty
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Q9. Which company provides long term services? ITC HLL OTHER

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