Analysis of Working Capital Management

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INTERIM REPORT ON

ANALYSIS OF WORKING CAPITAL MANAGEMENT

BY

MD.YUNUS JAMAL

FOR

APOLLO TYRES LTD.

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A INTERIM REPORT

ON

ANALYSIS OF WORKING CAPITAL MANAGEMENT

FOR

APOLLO TYRES LTD.

[pic]

Submitted To:

Company Guide: Mr. Mandeep Sisodia

Faculty Guide: Prof. Monika Chopra

Submitted By:

Name of the Author: Md. Yunus Jamal

Enroll No. : 09BS0003037

Date of Submission: 19th April, 2010

Acknowledgement

There is always a sense of gratitude, which one express to others for the helpful and needy services they render during all phase of life. I too would like to express my gratitude towards all those who have been helpful in getting this mighty task of project report writing.

It gives me immense pleasure in thanking my company guide Mr. Mandeep Sisodia at Apollo Tyres who supervised me during the training and for giving me opportunity and all possible help to carry out the project work. Whatever the time and place was, he was always ready to guide me. Without his wholehearted support it would not have been possible for me to learn this project.

I would like to express my sincere thanks to my faculty guide Prof. Monika Chopra for providing inspiration and encouragement to make this training entire meaningful and purposeful.

MD.YUNUS JAMAL

IBS PUNE

09BS0003037

Table of Content

Preface1
Abstract2
Introduction3
About Apollo Tyres Ltd.4
Tyre Industry Overview5
Balance Sheet And Income Statement6
Working Capital Management Defined1
Operating Sheets2
Operating Cycle Analysis3
Ratio Calculation.4
Reference5

Preface

Major changes in the economic climates and regulatory environment have seriously altered the conditions for Indian companies in recent years. Widening wings of globalization and increasing exposure to international markets have resulted in increasing competitions and relocation of production and distribution capacities. Furthermore, volatile exchange rate, increasing raw material prices have an impact on the cost and risk profile of the companies and thus on their financing structure.

Irrespective of whether it is a question of carrying out acquisition, financing further growth, averting imminent insolvency or simply ensuring that a company can continue to exist as a going concern, all of these factors require new or at least revised approaches for corporate financial management, professional financial management, which is helpful instrument for avoiding liquidity bottlenecks, helping for boosting returns and also facilitates a systematic control of financial risk.

With regard to developing alternatives financial arrangements, companies are increasingly focusing on their own resources. Efforts are directed toward optimizing the time span during which the working capital, defined as current assts minus current liability is tied up in the company. The attractiveness of working capital management is based on its two fold impact:

A reduction in the time span during which capital is tied up release liquidity and thus has a direct impact on the company’s financial position.However return on capital is also...
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