Escolar Documentos
Profissional Documentos
Cultura Documentos
Contd.
TYPE
PUBLIC ( NSE/BSE )
INDUSRY
TEXTILE
FOUNDED
1931
HEADQUATER
AHMEDABAD
KEY POEOPLE
PRODUCTS
REVENUE
NET INCOME
EMPLOYEE
25,620
WEBSITE
WWW.arvindmills.com
WORKING CAPITAL
Working capital means the funds (i.e.; capital) available and
used for day to day operations (i.e.; working) of an enterprise.
. It consists broadly of that portion of assets of a business
which are used in or related to its current operations.
It refers to funds which are used during an accounting period
to generate a current income of a type which is consistent
with major purpose of a firm existence.
CALCULATION
Net working capital represents the excess of current assets
over current liabilities.
The term current assets refers to assets which in the normal
course of business get converted into cash over a short period
usually not exceeding one year
Year
Inventory
Sundry Debtors
Other CA
Total
2005-06
251.9
64.1
228.5
101.6
3.3
649.4
2006-07
239.9
74.5
230.7
58.5
2.5
606.1
2007-08
281.3
84.4
212.6
79.5
2.4
660.2
2008-09
311.6
96.2
120.3
63.5
14
605.6
2009-10
281.7
121.3
174.6
47.9
10.1
635.6
CALCULATION OF W.C.
Year
2005-06
649.4
285.3
364.1
2006-07
606.1
236.7
369.4
2007-08
660.3
256.8
403.5
2008-09
605.5
259.6
345.9
Working capital
410
403.5
400
390
377.5
380
370
369.4
364.1
360
Working capital
350
345.9
340
330
320
310
2005-06
2006-07
2007-08
2008-09
2009-10
CAPITAL BUDGETING
A company is considering an investment proposal to install
new machineries at cost of Rs 50000 amount. Life of
machinery is 5 years. No scrap value. Tax rate is 30 %. Slm for
depreciation. Cost of capital is 10%.
YEARS
PARTICULARS
10,000
10,692
12,769
13,462
20,385
CIBDT
DEPRI
CFADBT
TAX
PAT
CFAT
10,000
10000
10,000
10,692
10000
692
208
484
10,484
12,769
10000
2769
381
1938
11,938
13,462
10000
3462
1039
2423
12,423
20,385
10000
10385
3116
7269
17269
= 4 + 50000 - 44845 * 1
62114 44845
= 4.30 YEARS
ANSWER
PAY BACK PERIOD
Year
Cumulative cfat
10,000
20,484
32.422
44,845
62,114
= 4 + 50000 - 44845 * 1
62114 44845
= 4.30 YEARS
Pat
cfat
10,000
484
10,484
1938
11,938
2423
12,423
7269
17,269
ARR= PAT/N
INVST./2
= 12114/5
50000/2
= 9.69 %
Pat
cfat
Pvif 5%
Pv inflow
10,000
0.909
9090
484
10,484
0.862
8659.78
1938
11,938
0.751
8965.44
2423
12,423
0.683
8484.05
17269
17,269
0.621
10724.05
= 45924.18
- 50000
= (4075.82)
4.PROFITABILITY INDEX
PI = PV OF INFLOW
PV OF OUTFLOW
= 45924.18
50000
= .918
Pat
cfat
Pvif 5%
Pv inflow
10,000
0.952
9509.98
484
10,484
0.907
10314.04
1938
11,938
0.864
10224.13
2423
12,423
0.823
13538.89
7269
17,269
0.784
Contd.
= 5 + 53106.41 50000 * 5
53104.41- 45924.18
= 7.1625..
Capital structure
The two principle sources of finance for a business firm are
equity and debt. What should be the ratio of equity and debt
in the capital structure is a question
The choice of a firms capital structure is a marketing problem
it is essentially concerned with how the firm decide to divide
its cash flow into two broad components.
CALCULATION:
Conclusion:
Debt Equity Ratio 1:1 considered good for any company.
. The company has avg. 0.30 to 0.45 which is not very good. In 2008 it is
0.31 and it is increased to 0.45 in 2010, which is good.
But, in 2011 it decreased to 0.34, and in 2012 it again decreased by 0.01,
which is not good for any company and it means that companys debtors
are around 3 times higher than its equity
Dividend decison
The dividend policy of the firm determines what proportion of earnings is
paid to shareholders by way of dividends and what proportion is ploughed
back in the firm for reinvestment purposes.
. A firms dividend payout ratio obviously depends on how earnings are
measured. For the sake of simplicity, we look at the accounting measure of
earnings.
As we are aware that accounting earnings often diverge from economic
earnings and may not truly reflect a firms capacity to pay dividend.
3
4
5
12-8-2008
04-8-2009
03-8-2010
12-7-2011
19-7-2012
Face value of
shares
Dividend %
Dividend rs.
100
10
10
10
10
20
20
30
20
20
20
2
3
2
2
01/06/2012
01/04/2012
01/02/2012
01/12/2011
01/10/2011
01/08/2011
01/06/2011
01/04/2011
01/02/2011
01/12/2010
01/10/2010
01/08/2010
01/06/2010
01/04/2010
01/02/2010
01/12/2009
01/10/2009
01/08/2009
01/06/2009
01/04/2009
01/02/2009
01/12/2008
01/10/2008
01/08/2008
Dividend (Rs.)
20
18
16
14
12
10
8
Dividend (Rs.)
1,000.00
800.00
600.00
400.00
200.00
0.00
Open
13-8-2008 to 13-9-2008:
after
Open
120
100
80
60
Open
40
20
3-7-2009 to 3-8-2009
Open
120
100
80
60
Open
40
20
Open
120
100
80
60
Open
40
20
2-7-2010 to 2-8-2010
Open
160
140
120
100
80
60
40
20
0
Open
4-8-2010 to 4-9-2010
after
Open
160
140
120
100
80
Open
60
40
20
0
11-7-2011 to 11-8-2011
before
Open
96
94
92
90
88
86
Open
84
82
80
78
13-8-2011 to 13-9-2011
after
Open
92
90
88
86
84
82
80
78
76
74
Open
18-7-2012 to 18-8-2012
before
Open
82
80
78
76
74
72
70
68
66
64
62
Open
20-8-2012 to 20-9-2012
after
Open
71
70
69
68
67
66
65
64
63
62
61
Open
Bibliography
http://www.sify.com/finance/stockpricequote/Arvind_Mills_LtdAML/ratios.html
http://www.sify.com/finance/stockpricequote/Arvind_Mills_LtdAML/fiiactivity.html
WWW. Sify.com/finance/equity/quote.php?
WWW.en.wikipedia.org
http://www.arvindmills.com/pdf/annaul_finacial_reporting/Annual
%20Report%20for%202009-2010-APL.pdf
http://www.sify.com/finance/equity/quotes/eqquotes.php?code=A
ML.B
WWW.businesstoday.infoday.in
http;//www.investopedia.com/university/financialstatements/finan
cialstatement8.aso