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A Study On Working Capital Management at Manali Petrochemicals Limited, Chennai
A Study On Working Capital Management at Manali Petrochemicals Limited, Chennai
A Study On Working Capital Management at Manali Petrochemicals Limited, Chennai
Submitted by
T.CHARLES DARWIN
Of
of
IN
FINANCE
AUGUST 2010
I
II
III
DECLARATION
Management Studies, R.M.D. Engineering College, Chennai would like to declare that the
SIGNATURE
IV
ACKNOWLEDGEMENT
I would like to express my sincere thanks to our Chairman Mr. R.S. Munirathinam, and
Vice Chairman Mr. R.M. Kishore who provided me an opportunity to study in this esteem
institution.
I wish to take this opportunity to express my deep sense of gratitude Prof J. Mark, MBA.,
Manali Petrochemicals Ltd, Chennai who has enlightened me in various aspects of Working
Capital Management and other functions of Finance Department, and I like to thank
Mr. G.Ragunath, H.R (Head), Mr. Prabaharan, H.R who provided me an opportunity to
I like to thank my internal guide Mrs. G. Nirmala MBA, M.Phil of MBA Department of
R.M.D.Engineering College, Kavaraipettai for their support, and motivation throughout this
Research. They had been a constant source of inspiration to prepare this project effectively.
Finally it is my foremost duty to express my gratitude to my Parents and Friends for their
moral support and encouragement without which it would not have been a complete one.
V
TABLE OF CONTENTS
Title page I
Bonafide Certificate II
Organisation Certificate III
Declaration IV
Acknowledgement V
Table of Contents VI
List of Tables VII
List of Figures VIII
Abstract IX
1. INTRODUCTION 1
1.1 Background of the Study 2
1.2 Need of the Study 14
1.3 Objectives of the Study 15
1.4 Scope of the Study 16
2. REVIEW OF LITERATURE 17
3. RESEARCH METHODOLOGY 24
3.1 Introduction 25
3.2 Research Design 25
3.3 Types of Data Collection 26
3.4 Limitations of the Study 27
3.5 Tools used in this Study 28
5. DATA ANALYSIS 41
APPENDICES 61
Bibliography 62
Balance sheet, Profit and Loss Account 64
VI
LIST OF TABLES
2007 to 2008
5.4 Statement showing the statement of changes in working capital of 45
2008 to 2009
5.5 Statement showing the Operating Cycle 46
5.6 Statement showing the Working Capital turnover 48
5.7 Statement showing the Inventory turnover 49
5.8 Statement showing the Receivables turnover 50
5.9 Statement showing the current Asset turnover 51
5.10 Statement showing the current ratio 52
5.11 Statement showing the Quick ratio 53
5.12 Statement showing the Absolute liquid ratio 54
5.13 Statement showing the Working capital from 2007 to 2011 55
5.14 Statement showing the Working capital from 2007 to 2011 56
LIST OF TABLES
VII
source to end use markets
4.3 Diagram showing the view of plant 1 34
4.4 Diagram showing the view of plant 2 35
5.1 Diagram showing the working capital indices 43
5.2 Diagram showing the net operating cycle 46
5.3 Diagram showing the working capital turnover ratio 48
5.4 Diagram showing the inventory turnover ratio 49
5.5 Diagram showing the receivables turnover ratio 50
5.6 Diagram showing the current asset turnover ratio 51
5.7 Diagram showing the current ratio 52
5.8 Diagram showing the quick ratio 53
5.9 Diagram showing the absolute liquid ratio 54
5.10 Diagram showing the working capital 56
ABSTRACT
This study on Working Capital needs and management of Manali Petrochemical Ltd., is to
evaluate the Working Capital position of the company because Working Capital plays a vital
The primary objective of the study is to analyse the Working Capital Management of Manali
The tools used to describe the performance of Working Capital of the company are Ratio
This analysis has been carried out in the basis of data relating to the past three years. Each
component of Working Capital such as Inventories, Receivables has been included in the
study and detailed analysis has been carried out with the help of financial ratios which would
be extremely useful for the management in making certain important decision regarding
Working Capital.
VIII
The overall performance of Working Capital of Manali Petrochemical Ltd., during the period
IX