FINANCAL MANAGEMENT PROJECT REPORT

SUBMITTED BY SARANSH JAIN SECTION A SEAT NO 29 13BSPHH010568

INTRODUCTION
GMR Group is an infrastructural company headquartered in Bangalore. The company was founded in 1978 by Grandhi Mallikarjuna Rao. Employing the Public Private Partnership model, the Group has successfully implemented several iconic infrastructure projects in India. The Group also has a global presence with infrastructure operating assets and projects in several countries including Turkey, South Africa, Indonesia, Singapore and the Maldives. Although the company started with Agri based industries like Jute/Sugar/Breweries but slowly moved in the Infrastructure space over the past decade. Now the GMR group interests lie in areas of Airports, Energy, Highways and Urban Infrastructure. GMR Infrastructure Limited is the infrastructure holding company formed to fund the capital requirements of various infrastructure projects across the sectors. It undertakes the development of the infrastructure projects through its various subsidiaries. They are also actively involved in community service as a part of Corporate Social Responsibility.[1] The Groups commitment to inclusive growth is achieved through its Corporate Social Responsibility arm the GMR Varalakshmi Foundation (GMRVF). GMRVF works with the under-privileged sections of the community in all the locations where the Group has business interests. The company was involved in the construction of Rajiv Gandhi International Airport Hyderabad and Sabiha Gken International Airport in Turkey.[2]GMR is also involved in the expansion and modernisation of Indira Gandhi International Airport in South West Delhi. Airports Operated by GMR are:

Indira Gandhi International Airport, South West Delhi Rajiv Gandhi International Airport, Hyderabad Sabiha Gken International Airport, stanbul

The Groups strategy of being a power generation-focused, integrated player in the Energy space has resulted in a diversified fuel as well as tariff-mix. The Group today has 6 power generating assets with a total capacity of 836.8 MW and another 6 power generation projects under various stages of implementation with a diversified fuel mix consisting of coal, natural gas, and hydro that will eventually produce an additional 5000 MW. Recently it has completed setting up of a 25 MW solar power plant in Gujarat and two wind mills of 2.1 MW in Gujarat and 1.2 MW in Tamil Nadu. Besides these the Group also has around 600 Million Tons of proven coal deposits in mines located in Indonesia and South Africa. The Group has six operating assets in the Highways sector. Four more are under construction the 181 km HyderabadVijayawada project in Andhra Pradesh on toll basis; the 29 km Chennai Outer Ring Road state project in Tamil Nadu on annuity basis, the 99 km Hungund-Hospet stretch in Karnataka on toll basis and the 555 km long Kishangarh - Udaipur - Ahmedabad highway the first brownfield mega highway project of the country on DBFOT basis.

The Groups projects in the Urban Infrastructure sector include a multi-product SEZ and Large Area Development in Krishnagiri, Tamil Nadu, a captive port based multi-product SEZ in Kakinada, Andhra Pradesh, Aviation and Logistics SEZ around the Hyderabad International Airport and development of a Central Business District around the Delhi International Airport. GMR Group chairman Grandhi Mallikarjuna Rao, a first-generation entrepreneur hailing from Rajam in Srikakulam District in Andhra Pradesh, pledged $340 million (Rs 1,540 crore), which is equivalent to his personal share in the infrastructure conglomerate, to improve education among the underserved sections of the society.

FINANCIAL RATIOS
LIQUIDITY RATIOS
1. CURRENT RATIO: Current Asset/Current Liabilities

Year

2013
2.418949

2012
3.592507

2011
3.114763

2. QUICK RATIO: (Current Asset-Inventories)/Current Liabilities

Year

2013
2.286517

2012
3.535965

2011
3.074503

LEVERAGE RATIOS
1. INTEREST COVERAGE RATIO: EBIT/Interest

Year

2013
1.02

2012
1.71

2011
1.18

ACTIVITY RATIO
1. INVENTORY TURNOVER: COGS/Avg. Inventory

Year

2013
16.43

2012
43.58

2011
65.97

2. DEBTORS TURNOVER: Net Sales/Avg. Debtors

Year

2013
4.93

2012
5.62

2011
8.84

3. TOTAL ASSET TURNOVER: Sales/Total Asset

Year

2013
0.13

2012
0.14

2011
0.07

PROFITABILITY RATIO:

1. GROSS PROFIT MARGIN: (Sales-COGS)/Sales

Year

2013
24.6

2012
20.97

2011
28.84

2. NET PROFIT MARGIN: PAT/Sales

Year

2013
3.65

2012
8.41

2011
8.61

SALES FORECASTING
Sales Forecasting is the process of estimating what your businesss sales are going to be in the future. Sales forecasting is an integral part of business management. Without a solid idea of what your future sales are going to be, you cant manage your inventory or your cash flow or plan for growth. The purpose of sales forecasting is to provide information that you can use to make intelligent business decisions.

Different Terms of Sale Forecast:

Short Term Forecast: for period upto 3 months ahead. For Tactical manner Medium Term Forecast: 1.For 1 year ahead. Most important in the area of budgeting. Long Term Forecast: for a period of 3 years and upward. Needed mainly by financial accountants, for long term resource implications. Sales Forecasting Techniques: Qualitative Technique Qualitative forecasting techniques are subjective, based on the opinion and judgment of consumers, experts; they are appropriate when past data are not available. They are usually applied to intermediate- or long-range decisions. Examples of qualitative forecasting methods are informed opinion and judgment, the Delphi method, market research, and historical life-cycle analogy. Quantitative Technique

Quantitative forecasting models are used to forecast future data as a function of past data; they are appropriate when past data are available. These methods are usually applied to short- or intermediate-range decisions. Examples of quantitative forecasting methods are last period demand, simple and weighted N-Period moving averages, simple exponential smoothing, and multiplicative seasonal indexes.

SALES FORECASTING FOR YEAR 2014

Fiscal Period

March 2014 (in Million INR) 26147

Sales Operating income (EBITDA) Operating profit (EBIT) Pre-Tax Profit (EBT) Net income EPS ( INR)

6226

3117 2166 3260 1.5

PRO FORMA 2014

Mar '13

Mar'12

Income Sales Turnover Other Income Total Income Expenditure Raw Materials Employee Cost Other Manufacturing Expenses Miscellaneous Expenses Preoperative Exp Capitalised Total Expenses Operating Profit PBDIT Interest PBDT Depreciation Profit Before Tax Tax Reported Net Profit

1,432.79 104.41 1,537.20 289.25 72.47 622.72 87.57

1,381.87 48.41 1,430.28 0 89.31 879.43 115.76

Mar'2014 100 1485.586332 9.038792901 13427.90719 159.0387929 236265.8569 69113.68789 16329204694 8.289454494 12314.70029 75.28234355 111838.4206 10.30037884 15302.10202

1,072.01 360.78 465.19 374.43 90.76 8.31 82.45 29 53.45

1,084.50 297.37 345.78 197.35 148.43 7.58 140.85 21.95 120.3

123393.3198 183311429.3 35.93993794 44.97873084 33.27361563 11.70511521 0.854253328 53391.88057 66819.78777 49430.8286 17388.95917 1269.067069

1,432.79 1485.5863

1,381.87

10.85086188 16119.8921 2.818236698 4186.733919 8.083281178 12008.41204

SHARE PRICE MOVEMENT

Date 24-Jan14 23-Jan14 22-Jan14 21-Jan14 20-Jan14 17-Jan14 16-Jan14 15-Jan14 14-Jan14 13-Jan14 10-Jan14 9-Jan-14 8-Jan-14 7-Jan-14 6-Jan-14 3-Jan-14 2-Jan-14 1-Jan-14 31-Dec13 30-Dec13 27-Dec13 26-Dec13 Open 23.15 23.6 23.75 23.25 22.5 22.4 22.8 22.45 22.3 21.95 22.15 22.9 22.9 23.45 23.7 23.1 25.05 24.85 24.6 24.6 24.45 24.15 High 23.35 23.6 23.75 24.05 23.65 23.1 23.05 22.85 22.8 22.7 22.8 22.95 23.25 23.7 23.85 24 25.15 25.35 25.3 24.75 24.9 24.9 Low 22.65 23 23.35 23.25 22.5 22.4 22.5 22.35 22.1 21.65 21.7 21.9 22.6 22.55 23.35 23.1 23.1 24.75 24.4 24.15 24.35 24 LTP 22.85 23.35 23.35 23.65 23.4 22.9 22.75 22.65 22.5 22.55 21.9 22.1 22.9 22.65 23.6 23.65 23.6 24.85 24.75 24.3 24.65 24.35 Close 23 23.45 23.45 23.75 23.45 22.95 22.7 22.65 22.45 22.3 21.9 22.05 22.8 22.65 23.45 23.7 23.6 24.85 24.8 24.35 24.55 24.45 Volume 33,29,425 38,94,894 41,84,162 58,88,222 52,78,690 50,47,883 47,92,440 80,37,693 44,62,788 49,22,232 75,46,443 50,97,247 34,27,814 62,97,596 52,70,321 51,70,805 88,43,302 62,15,223 79,46,695 31,00,091 71,35,678 Turnover (in Lakhs) 764.41 910.14 981.55 1,399.60 1,227.08 1,156.11 1,088.59 1,819.97 999.08 1,088.42 1,677.05 1,136.02 785.33 1,441.34 1,241.90 1,221.60 2,133.46 1,554.73 1,978.61 757.84 1,758.22

1,42,06,129 3,480.20

SOURCES OF FINANCE USED

Mar '13 12 mths Sources Of Funds Total Share Capital 389.24 Equity Share Capital 389.24 Share Application Money 0 Preference Share Capital 0 Reserves 6,796.49 Revaluation Reserves 0 Networth 7,185.73 Secured Loans 1,608.70 Unsecured Loans 2,158.33 Total Debt 3,767.03 Mar '12 12 mths Mar '11 12 mths

389.24 389.24

389.24 389.24

0 0 6,838.03 0 7,227.27 379.63 2,377.00 2,756.63

0 0 6,780.34 0 7,169.58 1,376.07 1,000.00 2,376.07

CAPITAL STRUCTURE
Capital Structure Analysis Of GMR infrastructures Ratio Debt Equity Ratio= Total debt/net worth 2011 2012 2013

2376.07/7169.58=0.33 2756.63/7227.27=0.38 3767.03/7185.03=0.524

Comparison of Debt Equity Ratio Ratio Debt Equity Ratio= Total debt/net worth GMR INFRA 0.524 Reliance infra 0.51 L&Tinfra 0.27 Jaypee group 1.52

Capital Structure (GMR Infrastructure)

Period From 2012 2011 2010 2009 2008 2007 2006 2005 To 2013 Equity Share 2012 Equity Share 2011 Equity Share 2010 Equity Share 2009 Equity Share 2008 Equity Share 2007 Equity Share 2006 Equity Share Instrument Authorized Capital (Rs. cr) 750 750 750 750 750 750 400 400 Issued Capital (Rs. cr) 389.24 389.24 389.24 366.74 364.13 364.13 331.08 264.44 -PAIDUPShares (nos) 3.89E+09 3.89E+09 3.89E+09 3.67E+09 1.82E+09 1.82E+09 3.31E+08 2.64E+08 Face Value 1 1 1 1 2 2 10 10 Capital 389.24 389.24 389.24 366.74 364.13 364.13 331.08 264.44

LEVERAGES:
1. DOL= Change in EBIT/EBIT/Change in Sales/Sales 2013 2012 EBIT Sales =0.206/0.203 =1.014 3149 26147 3117 25726 Change in EBIT & Sales 0.01 0.16

2. DFL= EBIT /EBT

2013 EBIT EBT 3149 2166

=3147/2166 =1.45

DIVIDEND POLICY
Dividend Summary For the year ending March 2013, GMR Infrastructure has declared an equity dividend of 10.00% amounting to Rs 0.1 per share. At the current share price of Rs 19.55 this results in a dividend yield of 0.51%.GMR Infrastructure had last declared a dividend of 10.00% for the year ending March 2013. * As per the Profit & Loss account

Dividend Declared
Announcement Date Effective Date 05-0913 Dividend Type Dividend (%) Remarks

31-05-13

Final

10.00

Rs.0.1000 per share(10%)Dividend

Dividend Payout Ratio Net Profit Dividend Payout Ratio Cash Profit Earning Retention Ratio Cash Earning Retention Ratio AdjustedCash Flow Times

84.62 -302.1 ---

--100 100 21.79

--100 100 176.94

Working Capital Management

Inventory management Finished products Finished Products Product Name Contract Revenue Interest Income From Sale Of Share & Securities Income From Management Services Dividend --------------------------- in Rs. Cr. -------------------------Installed Production Sales Capacity NA NA NA Quantity NA NA NA Quantity NA NA NA Mar 2013 Sales Value 1,142.17 255.66 28.22

Unit -

NA

NA

NA

6.74

NA

NA

NA

Raw material Raw Materials Product Name Steel Cement Others HSD Bitumen Aggregates Sand Boulders Granules ------------------- in Rs. Cr. ------------------Unit Not Reported Not Reported Not Reported Not Reported Not Reported Not Reported Not Reported Not Reported Not Reported Quantity NA NA NA NA NA NA NA NA NA Mar 2013 Value 76.43 43.42 42.56 34.46 29.48 22.72 19.67 14.65 5.86

Total

289.25

NEWS

1.GMR Infrastructure may move to Rs 32: Baliga. 2.GMR Infrastructure: Q3 results on Feb 11, 2014. 3.GMR Infra board approves raising of Rs 2500cr. 4.GMR signs JDA with International Finance Corporation. 5.BNP Paribas upgrades GMR Infrastructure to buy. 6.GMR Infra up 5%, stake sale in Istanbul airport to cut debt. 7.GMR Infra's Q2 loss widens to Rs 393cr.

REFERENCES
capitaline.com moneycontrol.com annual report of GMR infrastructures Prabhidas Lilladhar private ltd.