CHAPTER-I

INTRODUCTION

1
1.1 INTRODUCTION

In economic accounting, coins go with the drift assertion, additionally called the
assertion of coins flows or budget goes with the drift assertion, is an economic
assertion that indicates how adjustments instability sheet debts and profits affect coins
and coins equivalents and breaks the evaluation right down to working, making an
investment, and financing sports. Essentially, the coins go with the drift assertion is
worried about the go with the drift of coins in and coins out of the enterprise. The
assertion captures each of the cutting-edge working effects and the accompanying
adjustments withinside the stability sheets an analytical tool, the assertion of coins
flows is beneficial in figuring out the short-time period viability of an enterprise,
especially its cap potential to pay bills. International Accounting Standard 7 (IAS 7) is
the International Accounting Standard that offers coins that go with the drift
statements.

People and agencies inquisitive about coins go with the drift statements encompass:

• Accounting personnel, who want to realize whether or not the company may be
capable of cowl payroll and different on the spot fees

• Potential creditors or creditors, who need a clean photo of an enterprise's cap

potential to repay

• Potential buyers, who want to choose whether or not the enterprise is financially
sound

• Potential personnel or contractors, who want to realize whether or not the enterprise
may be capable of manage to pay for compensation

• Shareholders of the enterprise.

The coins go with the drift assertion changed into formerly called the go with the drift
of budget assertion. The coins go with the drift assertion displays an organization's
liquidity.

The stability sheet is a picture of an organization's economic assets and

responsibilities at an unmarried factor in time, and the profits assertion summarizes an
organization's economic transactions over a c programming language of the time.

2
These economic statements mirror the accrual foundation accounting utilized by
corporations to fit sales with the fees related to producing the one's sales. The coins
go with the drift assertion consists of simplest inflows and outflows of coins and coins
equivalents; it excludes transactions that don't at once affect coins receipts and
payments. These non-coins transactions encompass depreciation or write-offs on
awful money owed or credit score losses to call a few. The coins go with the drift
assertion is a coins foundation record on 3 forms of economic sports: working sports,
making investment sports, and financing sports. Non-coins sports are normally
mentioned in footnotes.

The coins go with the drift assertion is supposed to offer statistics on an organization's
liquidity and solvency and its cap potential to alternate coins flows in destiny
instances offer extra statistics for comparing adjustments in assets, liabilities, and
equity

The coins go with the drift assertion has been followed as a well-known economic
assertion as it removes allocations, which is probably derived from unique accounting
methods, together with diverse timeframes for depreciating constant assets.

3
1.2 NEED OF THE STUDY

• A enterprise with every day and dependable coins go with the drift statements
indicates greater monetary solvency and is greater appealing to buyers.

• Unfortunately, however, coins go with the drift assertion is vital to thoroughly verify
the incoming and outgoing go with the drift of coins and different assets in an
enterprise.

• Future income and income made for credit score (until they were paid off) aren't
blanketed withinside the coins go with the drift assertion, and a maximum of the
records will come from center operations.

• A coins go with the drift assertion files the incoming and outgoing coins in simple
terms.

• Not simplest will an enterprise proprietor with a coins go with the drift machine be
greater awareness of his or her economic status, however, it'll additionally assist
buyers to make knowledgeable choices on destiny investments.

• Many enterprise proprietors push aside the significance of coins to go with the drift
statements due to the fact they unwittingly consider that their cutting-edge economic
status may be construed from different economic reviews and projections.

• Payables and receivables have to be expressly described in coins go with the drift
assertion as have to the depreciation of product cost and stock that has now no longer
but been moved. This will permit an enterprise proprietor to examine beyond
durations with the cutting-edge economic status and decide whether or not your
receivables have improved or decreased.

4
1.3 SCOPE OF THE STUDY:

Since it'll now no longer be viable to behavior a micro-stage look at all Cement
industries in Telangana, the look at is limited dr the reddy laboratories.

A look at that entails an exam of the long-time period in addition to short-time period
reasserts that enterprise faucets to fulfill its necessities of finance. The scope of the
look at is constrained to the assets that Dr reddy's laboratories tapped over time below
look at i.e. 2016-2020.

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1.4 OBJECTIVES OF THE STUDY

• To realize the assertion of statistics of Dr Reddy's Laboratories. the use of coins

goes with the drift assertion that labeled coins go with the drift at some point of the
duration from working, investing, and financing sports.

• To examine the boom and operation of Dr Reddy's Laboratories.

• To interpret and examine the economic overall performance of the enterprise

• To look at the go with the drift of coins within side the company of Dr Reddy's
Laboratories.

• To recommend the performance with assets and makes use of coins have been made
through the co-ordinance the existing yr 2016-2020.

• To perceive the adjustments within side the factors of recognition and makes use of
operating capital is among above referred to years.

• To have a look at the economic overall performance of the enterprise

6
1.5 RESEARCH METHODOLOGY

The following are the principle reasserts of records used for this look at which might
be

Collected and compiled from posted and unpublished assets of the Company records.
Management statistics machine posted through Dr reddy's laboratories. Journals,
books, and different posted reviews.

The gift looks at is in particular primarily based totally on secondary assets of records
collection.

The secondary records changed into amassed from the literate to be had in libraries
and studies research and annual reviews are associated with the existing look at. It
consists of posted and unpublished literature like books, reviews, and typically
Articles of Dr reddy's laboratories.

7
LIMITATIONS

The obstacles of the existing look at are as follows:

• Cash Flow Statement fails to give the internet profits of an organization for the
duration because it does now no longer remember non-coins gadgets that could
effortlessly be ascertained through an Income Statement.

• Cash go with the drift assertion does now no longer assist to evaluate the liquidity or
solvency role of an organization.

• Cash Flow Statement is neither a replacement of Funds Flow Statement nor a

replacement of profits Statement.

• The provisions which might be made through the Companies Act conforms with the
Profit and Loss Account and Balance Sheet aren't in conformity with the Cash Flow
Statement which is ready as in line with AS three

• Does now no longer Conform with the Companies Act

• Cash Flow Statement is ready primarily based totally on historic value and, as such,
it does now no longer assist to realize the destiny/projected coins flows. Inter-Industry
Comparison now no longer Possible.

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 CHAPTER-II

REVIEW OF LITERATURE

9
2.1 THEORITICAL BACKGROUND

Cash waft is calculated with the aid of using making sure modifications to internet

earnings with the aid of using including or subtracting variations in revenue, charges,

and credit score transactions (performing at the stability sheet and earnings statement)

on account of transactions that arise from one duration to the following. These

modifications are made due to the fact non-coins gadgets are calculated into internet

earnings (earnings statement) and general property and liabilities (stability sheet). So,

due to the fact now no longer all transactions contain real coin gadgets, many gadgets

should be re-evaluated while calculating coins waft from operations.

For example, depreciation isn't absolutely a coins expense; it's far a quantity this is

deducted from the full cost of an asset that has formerly been accounted for. That is

why it's far brought lower back into internet income for calculating coins waft. The

best time earnings from an asset are accounted for in CFS calculations is while the

asset is sold.

Changes in bills receivable at the stability sheet from one accounting duration to the

following have to additionally be meditated in coins waft. If bills receivable

decreases, this means that extra coins have entered the enterprise from clients paying

off their credit score bills - the quantity with the aid of using which AR has reduced is

then brought to internet income. If bills receivable grow from one accounting duration

to the following, the quantity of the growth has to be deducted from internet income

due to the fact, even though the quantities represented in AR are revenue, they're now

no longer coins.

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Growth in stock, on the alternative hand, alerts that an enterprise has spent the extra

money to buy extra uncooked materials. If the stock becomes paid with coins, the

growth withinside the cost of stock is deducted from internet income. A lower in

stock might be brought to internet income. If stock becomes bought on credit score,

and growth in bills payable might arise at the stability sheet, and the quantity of the

growth from 12 months to the alternative might be brought to internet income. The

equal common sense holds proper for taxes payable, salaries payable, and pay as you

go insurance. If something has been paid off, then the distinction withinside the cost

owed from 12 months to the following must be subtracted from internet earnings. If

there's a quantity this is nevertheless owed, then any variations will be brought to

internet earnings. (For more insight, see Operating Cash Flow: Better Than Net

Income?)

Investing

Changes in equipment, property, or investments relate to coins from investing.

Usually coins adjustments from investing is a "coins out" item, due to the fact coins

are used to shop for new equipment, homes, or short-time period property which

includes marketable securities. However, while an enterprise divests an asset, the

transaction is considered "coins in" for calculating coins from investing.

Financing

Changes in debt, loans, or dividends are accounted for in coins from financing.

Changes in coins from financing are "coins in" while capital is raised, and they're

"coins out" while dividends are paid. Thus, if an enterprise troubles a bond to the

public, the enterprise gets coins financing; however, while hobby is paid to

bondholders, the enterprise is lowering its coins.

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Difference between Cash Flow Statement and

Income Statement

Statement of Cash Flows Profit and Loss Statement

1. It reveals the reasons for changes in 1. It reveals the reasons for changes in
working capital, i.e., where cash has been
working capital, i.e., where cash has been
taken from working capital.
taken from working capital.
2. The Income Statement aids in the 2. The Income Statement aids in the
compilation of the Cash Flow Statement
compilation of the Cash Flow Statement
in that it identifies one source of cash,
in that it identifies one source of cash,
namely, cash from operations.
namely, cash from operations.
3. Funds raised are matched with funds 3. Funds raised are matched with funds
spent. There is no difference between
spent. There is no difference between
capital and revenue components.
capital and revenue components.

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What is the difference between a Cash Flow Statement and a Balance

Sheet?

Statement of Cash Flows Statement of Position

1. It is a financial position change statement. It's a financial statement, for starters.
2. It depicts the amount of change over a 2. It shows the total value of assets and

specific time period. liabilities at a specific moment in time.

3. It doesn't look at how existing assets and 3. It displays all current and non-current

liabilities have changed. accounting obligations.

4. It is an analytical statement that analyses 4. Because it is not an analytical statement, it

the manner in which they were employed, is not as useful for making decisions as the

making it more valuable. cash flow statement.

Importance of cash flow statement:

The statistics that are supplied through the coins go with the drift announcement is
neither to be had withinside the stability sheet nor the earnings announcement and
therefore it is important. The modifications that have taken vicinity in among
accounting dates are highlighted through the coins go with the drift announcement. A
layman can not hold close to the underlying importance of achievements and
development of the business enterprise really through someone of the stability sheet
and earnings announcement of various years. The comparative and analytical have a
look at provided through the announcement giving the info of assets and makes use of
coins for the duration of a given length of titanic assist to the customers of statistics.
It is a completely beneficial device withinside the analytical package of the control
additionally, except the outsiders, to have ‘at a glance’ appraisal of the economic and
working overall performance of a business enterprise. Since the announcement
indicates the volume to which the running capital has been correctly placed to use,
the control’s challenge of taking coverage selections concerning investment,
dividends, etc, is significantly facilitated.

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The projected coins go with the drift announcement also can be organized after which
budgetary manipulate and capital expenditure manipulate may be exercised to the
advantage of the whole organization.

Uses of coins go with the drift announcement:

The coins go with the drift announcement of a business enterprise is of an extremely

good fee to control shareholders, lenders, bankers, cash lending institutions, etc.,

 Informative fee:- The economic outcome of enterprise operation are sincerely

defined in info through coins go with the drift announcement a number of the issues
which crop up withinside the minds of traders are properly solved through an easy
perusal of this announcement e.g.,

1. Where have the earnings gone.

2. Why does an imbalance exist between the liquidity function and profitability
function of a corporation?

 Forecasting fee:- A projected coins go with the drift announcement may be

organized and sources may be nicely allotted after an evaluation of the existing
country of affairs. The premier usage of to be had coins is essential for the general
increase of the corporation. The coins go with the drift announcement organized
earlier given a clean course to the control on this raged.

 Testing fee:-Whether the running capital has been powerful is used or now no
longer through the control can properly be examined through coins go with the drift
announcement. Whether running capital has been maintained on the right level, and
whether or not it's miles ok or insufficient may be acknowledged through a have a
look at the announcement. The control is warned in opposition to the injudicious use
of coins.

Decision-making fee:- Since the general creditworthiness of the corporation is

acknowledged, lenders and cash creditors can determine as to whether or not they
ought to offer loans to the business enterprise or now no longer. The assets of
elevating coins and their utility assist the shareholders to determine whether or not the

14
control of the enterprise is enlightened or now no longer concerning handling coins.
Mismanagement of coins can be prevented. The control can determine approximately
the destiny financing guidelines and capital expenditure, programmers.

The stability sheet, earnings announcement, and coins go with the drift announcement
are the 3 normally ordinary economic statements utilized by maximum companies for
economic reporting. All 3 statements are organized from identical accounting data,
however, every announcement serves its cause. The cause of the coins go with the
drift announcement is to document the assets and make use of coins for the duration
of the reporting length.

Structure of the Cash Flow Statement

The maximum typically used layout for the coins go with the drift announcement is
damaged down into 3 sections: coins flow from working sports, coins flow from
making investment sports, and coins flow from financing sports.

Cash flows from working sports are associated with your essential line of enterprise
and encompass the subsequent:

• Cash receipts from income or for the overall performance of services

• Payroll and different bills to employees

• Payments to providers and contractors

• Rent bills

• Payments for utilities

• Tax bills

Investing sports encompass capital expenditures – disbursements that aren't charged

to the fee however as an alternative are capitalized as property at the stability sheet.
Investing sports additionally encompass investments (apart from coins equivalents as
indicated below) that aren't a part of your ordinary line of enterprise. These coins
flows ought to encompass:

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• Purchases of property, plant, and equipment

• Proceeds from the sale of property, plant, and equipment

• Purchases of inventory or different securities (apart from coins equivalents)

• Proceeds from the sale or redemption of investments

Financing sports encompass coins flows regarding the enterprise’s debt or fairness
financing:

• Proceeds from loans, notes, and different debt instruments

• Installment bills on loans or any other reimbursement of debts

• Cash acquired from the issuance of inventory or fairness withinside the enterprise

• Dividend bills, purchases of treasury inventory, or returns of capital

Cash for functions of the coins go with the drift announcement usually consists of
coins and coins equivalents. Cash equivalents are short-time period, brief investments
that may be easily transformed into coins, which includes marketable securities, short-
time period certificate of deposit, treasury bills, and industrial paper. The coins go
with the drift announcement indicates the hole stability in coins and coins equivalents
for the reporting length, the internet coins supplied through or utilized in every one of
the categories (working, investing, and financing sports), the internet boom or lower
in coins and coins equivalents for the length, and the finishing stability.

There are techniques for getting ready the coins that go with the drift announcement –
the direct approach and the oblique approach. Both techniques yield identical results,
however, distinctive processes are used to reach the coins flows.

Direct Method

Under the direct approach, you're reading your coins and financial institution bills to
pick out coin flows for the duration of the length. You ought to use an in-depth
widespread ledger document displaying all of the entries to the coins and financial

16
institution bills, or you can use the coins receipts and disbursements journals. You
might then decide the offsetting access for every coin access to decide wherein every
coin's motion needs to be said at the coins go with the drift announcement.

Another manner to decide coins flow below the direct approach is to put together a
worksheet for every most important line object and remove the results of accrual
foundation accounting to reach on the internet coins impact for that precise line object
for the length. Some examples for the working sports phase encompass:

Cash receipts from customers:

• Net income according to the earnings announcement

• Plus starting stability in bills receivable

• Minus finishing stability in bills receivable

• Equals coins receipts from customers

Cash bills for inventory:

• Ending inventory

• Minus starting inventory

• Plus starting stability in bills payable to vendors

• Minus finishing stability in bills payable to vendors

• Equals coins bills for inventory

Cash paid to employees:

• Salaries and wages according to the earnings announcement

• Plus starting stability in salaries and wages payable

• Minus finishing stability in salaries and wages payable

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• Equals coins paid to employees

Cash paid for working costs:

• Operating costs according to the earnings announcement

• Minus depreciation costs

• Plus boom or minus lower in pay as you go costs

• Plus lower or minus boom in accumulated costs

• Equals coins paid for working costs

Taxes paid:

• Tax fee according to the earnings announcement

• Plus starting stability in taxes payable

• Minus finishing stability in taxes payable

• Equals taxes paid

Interest paid:

• Interest fee according to the earnings announcement

• Plus starting stability in hobby payable

• Minus finishing stability in hobby payable

• Equals hobby paid

Under the direct approach, for this example, you will then document the subsequent
withinside the coins flows from the working sports phase of the coins go with the drift
announcement:

• Cash receipts from customers

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• Cash bills for inventory

• Cash paid to employees

• Cash paid for working costs

• Taxes paid

• Interest paid

• Equals internet coins supplied through (utilized in) working sports

Similar kinds of calculations may be manufactured from the stability sheet bills to
remove the results of accrual accounting and decide the coins flows to be said
withinside the making investment sports and financing sports sections of the coins go
with the drift announcement.

Indirect Method

In getting prepared the cash flows from walking sports activities section beneath the
indirect approach, you start with net income in keeping with the income statement,
contrary out entries to income and charge money owed that do not incorporate a cash
movement and show the extrude in net working capital. Entries that have an impact
on net income but do now not represent cash flows ought to include income you have
were given earned but now not however acquired, amortization of pay as you move
costs, accumulated costs, and depreciation or amortization. Under this approach, you
are studying your income and charge money owed, and working capital. The
following is an example of approaches the indirect approach is probably furnished on
the cash glide statement:

• Net income in keeping with the income statement

• Minus entries to income money owed that do not represent cash flows

• Plus entries to charge money owed that do not represent cash flows

• Equals cash flows in advance than movements in working capital

• Plus or minus the extrude in working capital, as follows:

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A boom in the modern property (aside from cash and cash equivalents) is probably
confirmed as an awful determine because of the real cash growth to be spent or
converted into the exceptional modern property, thereby decreasing the cash stability.

A decrease in modern property is probably confirmed as a fantastic determine,

because of the reality exceptional modern property was converted into cash.

A boom in modern liabilities (aside from short-term debt which is probably stated
withinside the financing sports activities section) is probably confirmed as a fantastic
determine due to the fact more liabilities suggest that tons much less cash grow to be
spent.

A decrease in modern liabilities is probably confirmed as an awful determine because

the real cash grows to be spent as a way to reduce liabilities.

The net effect of the above would possibly then be stated as cash provided with the
useful resource of the usage of (used in) walking sports activities.

The cash flows from making a funding sports activities and financing sports activities
is probably furnished the equal way as beneath the direct approach

2.1. ARTICLES

ARTICLE:1

Title: Importance of the Cash Flows Statement

Authors: Jarrah, Kulkarni, & O'Connor

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Publication year: 2007

Abstract:

Collected actual cash glide statistics in form of monthly account summary critiques
for various projects beneath the Texas Department of Transportation. The sample
consisted of numerous magnificence of projects which include advent and alternative
of bridges, new no freeways, road overlay and rehabilitation of modern-day roads,
landscape scenic enhancements, widening of freeways, etc. Projects were in addition
classified in unique price ranges. Based on the scatter chart of payments in
competition to time for unique projects in a given magnificence, a fourth-degree
polynomial regression assessment grow to be used to collect the cash glide curves that
have become out to be feature ‘S’ customary for optimum of the projects. Although
statistical significance could not be proved due to the availability of constrained
statistics, a probable approach for cash glide prediction grows to be installed. Since
the statistics grow to be related to payments to the contractor, only the cash inflow
curves are probably installed. Extending the equal approach to statistics for
contractor’s cash outflows, there appears to be a possibility of working out the
networking capital gap.

ARTICLE: 2

Title: Terms withinside the Cash Flows Statement

Authors: Gorog

21
Publication year: 2009

Abstract:

Suggested a set of recent measurements and symptoms and symptoms consistent with
the ‘earned charge’ measurements and symptoms and symptoms for possible
integration of every system. Therefore much like the earned charge measurements
which include Budgeted Cost of Work Scheduled (BCWS), Budgeted Cost of Work
Performed (BCWP), and the Actual Cost of Work Performed (ACWP) for working
out the Cost Performance and Schedule Performance Indices (CPI and SPI); the
modern-day set of measurements and symptoms and symptoms grow to be based
definitely on the ‘Price Value’ and ‘Invoice Value’ of the shriveled work. This ought
to therefore forecast the difference amongst price to be acquired with the useful
resource of the usage of the contractor from patron and the price to be expended with
the useful resource of the usage of the contractor for the amount of hard work
executed at any issue of time. Hence the differential indicated expected margin-based
mostly on challenge status.

ARTICLE: 3

Title: analysis of the Cash Flows Statement

Authors: Maniar

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Publication year: 2007

Abstract:

A model for finding the Least Working Capital (LWC) is the maximum cumulative
awful cash glide at some point of a challenge grow to be proposed and installed at the
concept of a sample of Indian infrastructure projects. It considered unique price
parameters which include labor, material, overheads, subcontracting charges, gadget
and tool costs, etc. Assuming uniform charge of expenditure at some point of
contracting period the model using a multiple regression assessment on the sample
statistics expected the LWC as the whole of challenge costs till the receipt of the
number one charge from the patron.

Cash is the most liquid asset, is of critical importance to the daily operations of
organization firms. While the proportion of organization property held withinside the
form of cash will be very small, often amongst 1 and 3 percent, its inexperienced
manipulate is crucial to the solvency of the organization because of the reality in
completely critical sense cash is the focal point of finances flows in an organization.

ARTICLE: 4

Title: A Logical Approach To The Statement Of Cash Flows

Authors: Fred Petro, Farrell Gean,

23
Publication year:2016

Abstract:

Of the three financial statements in financial reporting, the Statement of Cash Flows
(SCF) is in all likelihood the most challenging. The hardest aspect of the SCF is in
developing a knowledge of approaches previous transactions are finalized in this
record. That is, the SCF will be very plenty the culmination issue for optimum all of
financial accounting. Know-how of a manner to prepare the record or learning the
mechanics isn't always in the particular complex. With the usage of a number one
worksheet and matrix, (later furnished), the training of the walking sports activities
section, the hardest of the three areas covered withinside the SCF, can be completed
quite easily. That is, this section can be completed, for the most part, at the same time
as now no longer having entire comprehension or knowledge of approaches initial
transactions sooner or later reap the SCF

ARTICLE: 5

Title: Improvements of the cash-glide statement control feature in financial reporting

Authors: MetkaDuhovnik

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Publication year:2008

Abstract:

On the concept of deductive problems utilizing professional judgment, the object

focuses on the more charge of accounting statistics that can be given to the clients of
financial statements with the useful resource of the usage of a nicely prepared
statement of cash flows. It is based definitely on the finding that the professional
literature is inconsistent in distinguishing liquidity and profitability statistics, and
consequently moreover in distinguishing most of the ratios calculated on that basis. It,
therefore, stimulates an improvement withinside the extraordinary of accounting
statistics with a proper away statement of cash flows, based mostly on tracing instead
of calculating the actual cash glide. On the concept of financial statements, in
conjunction with a proper away statement of cash flows, the ratio assessment of
financial statements ought to be approached from every factor of profitability and
cash return. The cash glide ratios would possibly feature a control mechanism over
the assumptions used at the same time as getting prepared the stableness sheet and
income statement withinside the decided on financial reporting framework.

25
 CHAPTER-III

COMPANY PROFILE

COMPANY PROFILE

26
ABOUT THE COMPANY

Dr. Reddy’s Laboratories have become primarily based totally thru manner of approach

of Dr. Anji Reddy, entrepreneur-scientist, 2084 the DNA of the agency; is drawn from

its founder and his vision to installation India’s first discovery led global pharmaceutical

agency .in, reality, it's a far this spirit of entrepreneurship that has customary the agency

to come to be what it's far today. The agency is centered on growing and delivering

modern and tremendous products to help humans lead greater wholesome lives.

Dr. Reddy’s is a research-based agency with vertically blanketed operations. The agency

develops, manufactures, and markets a large form of pharmaceutical products in India

and overseas. Dr. Reddy’s produces finished dosage forms, lively pharmaceutical

additives, diagnostic, kits, vital are and biotechnology products. The easy research

software program of Dr. Reddy’s centered on maximum cancers diabetes, bacterial

infections, and pain.

Since its inception in 2084, Dr. Reddy’s has decided to walk the route of discovery and

innovation in health sciences Reddy’s has been a quest to preserve and decorate the

tremendous of life, and they; heaves had almost a few years of creating stable

pharmaceutical Solutions with the very last reason of making the world a heather place.

Dr. Reddy’s creates and delivers modern pharmaceutical health care solutions that

humans enjoy longer, greater wholesome, and additional green lives. Reddy’s regular

formulations have moreover come to be very well-known in tremendous-conscious

regulated markets collectively with America and Europe. We are equipped to spread

herbal wings further and get in touch with greater lives all through the globe

27
In 2073, after gaining six years of enjoyment withinside the manufacturing and

implementation of a new era in bulk tablets from public place agency IDPL, Hyderabad.

Dr. Reddy’s decided to start up an easy tablets unit at that factor there were few one-of-

a-kind game enthusiasts withinside the private place at that surrender of the

pharmaceutical fee chain.

In 2075, Dr. Reddy’s started the improvement of nautiloids of which he has become the

founder-handling director it has become proper right here that they made a waft that has

become to come to be the hallmark of the corporation withinside the years to come.

In 2081, as handling director of big organics Ltd; Dr. Reddy’s goal has become to boom

and manufacture a large spectrum of bulk tablets to permit the pharmaceutical company

to launch their formulations. Unfettered. There were only a couple of – pharmaceutical

agencies at that factor with the capability to boom greater latest tablets bit they could

now not sell the bulk to one-of-a-kind formulators. Here, Dr. Reddy’s finished a number

one feature in pioneering the technology and production of ‘sulphamethoxazole ‘an anti-

bacterial in India. Another dream has become to do it on his own, because of the reality

that has become the time that his second check with partnership has become moreover

crumbling. He realizes his dream speedy thereafter, then the installation of Dr. Reddy’s

Laboratories in 2084.

DR.REDDY’S LTD IN INDIA:

Dr. Reddy’s at the start launched in 2084 producing regular medications. In 2086,
Reddy’s started operations on branded formulations. Within a year Reddy’s had
launched Norilet, the agency’s first identified emblem in India. Soon, Reddy’s
obtained another fulfillment with Omez, its branded omeprazole – ulcer and reflux
oesophagitis medication – launched at half of the charge of various producers on the
Indian market at that factor.

Within a year, Reddy’s have come to be the number one Indian agency to export the

28
collect additives for prescription drugs to Europe. In 2087, Reddy’s started to
transform itself from a provider of pharmaceutical additives to one-of-a-kind
manufactures proper right into the manufacture of pharmaceutical products.

OBJECTIVES:

To growing a chunk environment that promotes safety, humans training and

development, and ordinary overall performance orientation in line with Dr. Reddy’s
values and policies.

To Improvement in supply and availability of utilities and time positive repair of m/c
and equipment (along with the relevant facts as constant with web web web page
objectives).

Ensure that the device and related systems (every antique and new) are (re)qualified /
(re)confirmed as constant with the schedule.

Reduce utility consumption in line with the web web web page objectives. To come
to be aware of and put in force electricity conservation measures.

To ensure that all the drawings and technical specifications of the device and device
in his/her location are updated.

To ensure cleanroom ordinary overall performance (checks, calibration,

qualification, and maintenance, along with documentation, of filters and one-of-a-
kind related equipment) as constant with SOP.

AWARDS:

Dr. Reddy’s ltd has been an everyday recipient of awards for excellence withinside
the Pharma sector, exceptional employees, and maximum reputable company. The
Saumen Chakroborty- CFO of provided to Dr. Reddy’s lab the Best Performance
Award sustained for CFO withinside the Pharma Sector for 2007 improvement of

foreign places business.

Dr.Reddy’s lab additionally obtained the award in 2004 for the Most Respected Company

29
award

It also received the award in 2004 for the Best Employers in India. For development of

indigenous know-how, continued support is also necessary and a detailed write up

on R&D facilities is enclosed.

INSIGHT INTO VARIOUS DEPARTMENTS:

 RESEARCH AND DEVELOPMENT:

The studies and improvement division, hooked up withinside the overdue 2080s, is

critical to the lively pharmaceutical elements commercial enterprise. It contributes

extensively to our commercial enterprise through the growing highbrow property,

presenting studies to lessen the value of manufacturing of the merchandise, and

gambling a lively function withinside the choice and improvement of recent

merchandise.

The analytical studies institution helps the improvement pastime through sporting

out impurity profiling, shape elucidation, and balance studies.

 QUALITY POLICY:

Dr. Reddy is devoted to presenting customer’s merchandise assembly or exceeding

exceptions continually in phrases of specifications, delivery, technical support,

regularity compliance & competitiveness.

Customer Focus:

30
We are devoted to pride clients through presenting services and products that exceed

expectancies continually in phrases of fine, pace to marketplace, delivery, and

competitiveness

Execution Excellence:

We will continuously enhance systems, technologies, infrastructure, regulatory

compliance, and technical support.

Competency Building:

We will make certain an excessive degree of competency through attracting and

maintaining gifted employees in all regions thru persevering with schooling and

improvement.

Beneficial Partnerships:

We will expand and preserve together useful relationships with all commercial

enterprise pals and offer lasting costs to all stakeholders. Constantly enhance the

procedure, technologies & infrastructure to constantly higher the fine of merchandise

produced. Ensure most fulfilling schooling to all employees chargeable for fine-

associated activities. Maintain together useful relationships with vendors, improve

the fine of the existence of employees & offer an enduring cost to shareholders.

BOARD OF DIRECTORS:

Dr’s Anji Reddy, Chairman

GV Prasad, Vice Chairman & CEO

K. Satish Reddy, COO & MD

Abhijit Mukharjee, President Global Genetics

Dr. Kartikeya Reddy, Senior Vice-President & Head Biologics

KB. Shankara Rao, Executive Vice-President IPDO

31
Vilas whole, Head – Formulations Manufacturing

Dr. Raghav Chari, Senior Vice-President-Proprietary Products

Prabir Jha, Senior Vice-President Global Chief HR.

Amit Patel, Senior Vice-President & Head-NA Genetics

Chakraborty, President-Corporate

Umang Vohra, Chief Financial Officer

. COMPANY VALUES

Our commercial enterprise practices are guided through the very best moral

requirements of real integrity and transparency. To try for excellence in the whole

thing they think, say and so. The values that manual the mind and moves are:

• Quality:

Reddy’s are committed to reaching the very best degrees of fine in the whole thing

we do to pride clients, internal & external, each time.

• Respect for the individual:

We uphold the vanity and dignity of every different through growing an open

subculture conducive to the expression of perspectives and thoughts regardless of

hierarchy.

• Innovation & non-stop studying:

We create a surrounding of innovation and studying that fosters, in everyone in all of

us, a choice to excel and a willingness to experiment.

• Collaboration & Teamwork:

Dr.Reddy’s seeks possibilities to construct relationships and leverage knowledge,

expertise, and assets to create more cost throughout functions, businesses, and

locations.

32
• Harmony & Social Responsibility:

Dr.Reddy’s take utmost care to shield our herbal surroundings and serve the groups

wherein they stay and work

SWOT ANALYSIS OF DR.REDDY’S LAB

• STRENGTH:

Strong merchandise portfolio.

Low value-based.

Six new chemical entities.

A huge variety of anti-most cancer capsules developed.

Contribute to the corporation’s excessive-income margin of around 34% of income.

Manufacturing & marketplace over 250 drug treatments focused on a huge variety of

therapies.

Expertise in growing modern product formulations.

Markets pharmaceutical merchandise in 148 countries.

Joint ventures in China & South Africa.

• WEAKNESSES

The excessive quantity of sales from overseas.

Generic capsules smallest focus.

Lack of patent regulation in India harms the income of its merchandise.

The smallest part of sales from general at around 20%.

• OPPORTUNITIES

Take a drug then the manner to the marketplace.

Domestic general capsules marketplace.

33
In any other 4-6 years many product patents acquired after the 2004 regulation will

burst off presenting a possibility for the corporation to grow its home footprints in

Generic.

Buyback of the included drug improvement corporation from ICICI venture &

Citigroup.

• THREATS:

Need to benefit FDA popularity of all sources & merchandise.

Heightened issues approximately the profitability of the German generics

commercial enterprise of Beta pharm.

Revenue jogging into billions which dwarfs Reddy’s annual turnover litigation

charges.

Products need to skip strict FDA trials earlier than going to the marketplace, which

may be steeply priced and time-consuming.

34
 CHAPTER-IV

DATA ANALYSIS

4.1 DATA ANALYSIS:

For many businesses, implementing an effective working capital management system

is a great approach to boost profits. Ratio analysis and individual component
management are the two most important parts of working capital management.

35
2019-2020 Working Capital Turnover Ratio

Working capital turnover ratio 2019 2020

Total Current Assets

Sundry Debtors 72039.39 71,967.91

Cash and Balances with RBI 2207.90 2,948.23

Balance with Bank 2081.26 3,031.66

Advances 48468.98 53,027.63

Total 183597.53 190,975.43

Total Current Liabilities

Borrowings 20416.62 18,895.58

Other Liabilities 2789.81 3,333.82

Contingent Liabilities 42177.47 46,903.54

Total 65319.90 63192.94

Networking capital 58279.63 67,842.49

Increase decrease in internet operating

capital 9562.86

36
 200000
160000
120000
80000
40000
0
I l l l l
atio atio sets tors RB ank nces ota ities ngs ities ities ota pita pita
r
r A eb iths B T l
i w i i i l l T
rR va iab rro Liab Liab
a a
g c ng c
ve ove ent y D s w with Ad L i n
n o n r r e e t o r t k ti
ur ur ur nd nc c rr
en B the gen or era
la T al t al C Su ala alan u O n t w op
it t
pi Tot d B
B
alC o nti Ne et
ap a n t C n
gC gc sh
a To nt
er
ik n kin a i
or or C in
W W a se
0 re
02 dec
- 2
19 se
20 r ea
c
In

Interpretation:

Dr. Reddy's labs' networking capital has been expanded to 9562.86 Cr, and the

financial condition, i.e. the performance of Dr. Reddy's labs, has improved, as have

the present assets and liabilities.

37
Calculation of the period's operating profit (2019-2020)

Particulars Amount Amount

(Cr) (Cr)
2020 2019
Net profit 1576.83 9203.17
Add: depreciation 185.20 192.53
Cash earned in gross terms 15332.01 9335.68
Taxation for the year is lower. 8.69 7.29
Cash flow from operations 15323.32 9328.39

STATEMENT OF SOURCES AND APPLICATION OF CASH

For the period (2019-20)
Sources Rs Applications Rs

Secured loans 1754.68 Increase in Gross Block 357.48

Unsecured loans 7041.62 Secured loans paid 307.62
Cash from operation 3031.66 Net increases in 9562.86
Working Capital
15227.96 15227.96

Interpretation
From the preceding table, it can be seen that the company's net working capital is

rising. In 2019-2020, the company's current assets grew from Rs.53027.63 to

38
Rs.48468.98. The company's liabilities is expected to rise from Rs.87585.35 in 2019-

2020. In 2019-2020, the company's net capital was Rs.385.18. It has also been raised

to. The increasing working capital is recorded as Rs.9562.86.

Dr. Reddy's Laboratories' Working Capital

Working capital turnover ratio 2019

39
Working capital turnover ratio 2018 2019

Total Current Assets

Sundry Debtors 55192.04 72039.39

Cash and Balances with RBI 2018.49 2207.90

Balance with Bank 620.06 2081.26

Advances 39079.23 48468.98

Total  96845.82 183597.53

Current Liabilities Total

Borrowings 18595.52 20416.62

Other Liabilities 2553.67 2789.81
Contingent Liabilities 19320.52 42177.47

Total 36468.71 65319.90

Net working capital 60377.17 58279.63

Increase\decrease in net working capital 2157.48

40
 200000
160000
120000
80000
40000
0
19 o rs k al s s al al
20 r ati bto Ban Tot ing ilitie Tot apit
o er e th es ow iab gc
r ati nov ry D wi iliti orr nt L kin
e
er ur und anc iab B
ng
e
wo
r
n ov tal t S a l n tL ti t
ur pi B
rr
e
Co
n Ne
al t g ca C u
it n
cap rki
g W o
in
o rk
W

Interpretation:

Dr. Reddy's labs' networking capital has been reduced to 2147.48 Cr. The financial

situation, i.e. Dr. Reddy's laboratories' performance has improved, and the current

assets defects its current obligation.

41
Calculation of operating profit for the period (2018-2019)

Particulars Amount(Cr) Amount (Cr)

2019 2018
Net profit 9203.17 7028.66
Add: depreciation 192.53 176.76
Gross cash generated 9335.68 7205.42

Less: taxation for the year 7.29 7.22

Net cash generated 9328.39 7198.20

STATEMENT OF SOURCES AND APPLICATION OF CASH

For the period (2018-19)

Sources Rs Applications Rs

Secured loans 1528.77 Increase in Gross Block 2018.49

Unsecured loans 2041.62 Secured loans paid 39144.15

Cash from operation 2081.26 Net increases in 2147.48

Working Capital

43208.07 43208.07

Interpretation

From the above table, it's miles found that the networking capital of the corporation
suggests a growing fashion. The present-day belongings of the corporation have
improved from Rs.48468. ninety-eight to Rs.39079.23 in 2018-2019. The present-day
legal responsibility of the corporation displaying a growing fashion from
Rs.9389.seventy-five in 2018-2019. The internet capital corporation stood at
Rs.449.ninety-six in 2018-2019. And its miles improved too. The growing running
capital is recorded as Rs.2147.48.

42
Working capital turnover ratio 2018

Working capital turnover ratio 2017 2018

Total Current Assets
Sundry Debtors 41584.92 55192.04

Cash and Balances with RBI 2167.72 2018.49

Balance with Bank 363.26 620.06

Advances 29329.31 39079.23

Total 72785.21 96845.82

Total Current Liabilities
Borrowings 17723.95 18595.52
Other Liabilities 3032.36 2553.67
Contingent Liabilities 18291.30 19320.52
Total 27047.61 36468.71
Networking capital 45737.6 60377.17
Increase decrease in internet operating

capital 20639.51

43
 120000
100000
80000
60000
40000
20000
0
8 o ts rs BI k s al s s s s al al al
20
1
r ati sse bto h R Ban ance Tot ilitie ing ilitie ilitie Tot apit apit
r A e it w
ati
o ve ent y D s w with Ad
v
Liab rro Liab Liab gc gc
r o
n rr d ce cer nt o e r n t kin tin
ve
r r
tu l Cu Sun alan lan r re B Oth nge w or era
o l u t op
n ta a B a lC
ti
Ne et
tur a pi Tot n d B ta C on n
l gc a To er
ta sh nt
api kin a i
gc or C in
kin W a se
or re
W dec
se
r ea
c
In

Interpretation:

The networking capital of Dr. Reddy’s Laboratories has been multiplied to 60377.17

Cr the monetary function i.e. the overall performance of Dr. Reddy’s Laboratories

has multiplied and the modern-day property illness its modern-day liability.

44
Calculation of operating profit for the period (2017-2018)

Particulars Amount (Cr) Amount (Cr)

2018 2017
Net profit 7028.66 4817.18
Add: depreciation 176.76 98.27
Gross cash generated 7205.42 4914.39
Less: taxation for the year 7.22 4.37
Net cash generated 7198.20 4905.02

Interpretation

From the above table it is observed that the net working capital of the company shows

increasing trend. The current assets of the company have increased from Rs.21766.80

to Rs.19218.44 in 2017-2018. The current liability of the company showing

decreasing trend from Rs.29329.31 in 2017-2018. The net capital company stood at

Rs.449.96 in 2017-2018. And it is increased to. The increasing working capital is

recorded as Rs.20639.65.

45
Working capital turnover ratio 2017

Working capital turnover ratio 2017

Working capital turnover ratio 2016 2017

Total Current Assets
Sundry Debtors 30026.98 41584.92

Cash and Balances with RBI 2085.67 2167.72

Balance with Bank 220.59 363.26

Advances 20775.05 29329.31

Total 53162.29 72785.21

Total Current Liabilities
Borrowings 6200.51 17723.95
Other Liabilities 2869.42 3032.36
Contingent Liabilities 4176.17 18291.30
Total 19186.08 27047.61
Networking capital 39936.21 45737.6
Increase decrease in internet operating

capital 5801.39

46
 80000
60000
40000
20000
0
7 o ts rs BI k s al s s s s al al al
20
1
r ati sse bto h R Ban nce Tot ilitie ing ilitie ilitie Tot pit apit
r A e it va w
iab rro Liab Liab
a c
g c ng
ati
o
o ve ent y D s w with Ad L i n
r rn rr d ce e r t
n o e n r t k ti
ve
r
tu l Cu Sun alan lanc r re B Oth nge w or era
n o l
ta a B a u ti t op
tur a pi Tot d B alC on Ne et
l n t C n
ta gc sh
a To nt
er
api kin a i
gc or C in
kin W ase
or re
W d ec
se
r ea
c
In

Interpretation:

Dr. Reddy's labs' networking capital has been enhanced to 45737.60 Cr, indicating

that the financial condition, i.e. the performance of Dr. Reddy's labs, has improved,

and the current assets have exceeded the current obligation.

47
Calculation of operating profit for the period (2016-2017)

Particulars Amount (Cr) Amount (Cr)

2017 2015

Net profit 4817.18 3676.59

Add: depreciation 98.27 90.00

Gross cash generated 4914.39 3766.59

Less: taxation for the year 4.37

Net cash generated 4905.02 3760.59

Interpretation

From the above table, it's miles discovered that the internet operating capital of the

employer indicates a growing fashion. The contemporary belongings of the employer

have elevated from Rs.17723. ninety-five to Rs.2926.147 in 2015-2017. The

contemporary legal responsibility of the employer displaying reducing fashion from

Rs.5875.sixty-seven in 2015-2017. The internet capital employer stood at

Rs.4879.sixty-five in 2015-2017. And it's miles elevated too. The reducing operating

capital is recorded as Rs.6369.sixty-five.

48
Working capital turnover ratio 2016

Working capital turnover ratio 2016

Working capital turnover ratio 2015 2016

Total Current Assets
Sundry Debtors 21749.00 30026.98

Cash and Balances with RBI 995.35 2085.67

Balance with Bank 205.32 220.59

Advances 18625.34 20775.05

Total 39317.01 53162.29

Total Current Liabilities
Borrowings 5904.07 6200.51
Other Liabilities 3257.34 2869.42
Contingent Liabilities 4486.28 4176.17
Total 19647.69 19186.08
Networking capital 25667.32 39936.21
Increase decrease in internet running

capital 20268.89

49
 60000
50000
40000
30000
20000
10000
0
6 o ts rs BI k s al s s s s al al al
20
1
r ati sse bto h R Ban ance Tot ilitie ing ilitie ilitie Tot apit apit
r A e it w
tio ve ent y D s w with Ad
v
Liab rro Liab Liab gc gc
r a n o r r ce e nt o e r n t k in nin
er r
ur u n n c d e B th ge or un
n ov al t al C Su ala alan urr O tin etw et r
t t B C
ur pi o d B al Co
n N rn
lt ca T an ot te
ti a in
g sh T in
ap k a in
or C
gc se
kin W r ea
or de
c
W s e
ea
ncr
I

Interpretation:

The networking capital of Dr. Reddy’s Laboratories has been extended to

39936.21Cr the monetary function i.e. the overall performance of Dr. Reddy’s

Laboratories has extended and the modern-day belongings disorder its modern-day

liability.

50
Calculation of operating profit

For the period (2015-16)

Particulars Amount(Cr) Amount(Cr)

2015 2014

Net profit 3676.59 3222.70

Add: depreciation 90.00 69.56

Gross cash generated 3766.59 3292.26

Less: taxation for the year 1.86

Net cash generated 3766.59 3290.40

INTERPRETATION:

From the above table, it's miles determined that the internet operating capital of the

enterprise suggests expanded From Rs. 483. ninety-six to Rs. 453. forty-four in

2014-.15.The internet operating capital of the enterprise Rs. 83. ninety-six in 2014-

2015. And its miles expanded. The growing Working capital is recorded as Rs.

657.43.

51
NET INCREASES IN WORKING CAPITAL

YEAR INCREASE / DECREASE AMOUNT

2014-2015 INCREASE 20268.89

2015-2017 DECREASE 5801.39
2017-2018 INCREASE 20639.51
2018-2019 INCREASE 2147.48
2019-2020 INCREASE 9562.86

AMOUNT
25000

20000

AMOUNT
15000

10000

5000

INTERPRETATION:

Working capital increased, as shown in the table above. The operating capital was

grown throughout the years 2014–15. The operating capital for the year 2019-20 is

Rs.9562.86. The rise in net working capital is due to the decrease in current liabilities.

52
Changes in cash from operations

YEAR AMOUNT

2015-2016 220.59

2016-2017 363.26

2017-2018 620.06

2018-2019 2081.26

2019-2020 3031.66

AMOUNT
3500
3000
2500
2000
AMOUNT
1500
1000
500
0

0 16 0 17 0 18 0 19 0 20
-2 -2 -2 -2 -2
15 16 17 18 19
20 20 20 20 20

Interpretation

The table above illustrates the continual changes in cash flow from operations. The

cash flow from operations grew in 2014-15. The cash flow from operations has risen

over time. In the next year of 2019-20. In the fiscal year 2019-20, the cash from

operations is Rs. 3031.66.

APPLICATION 2015-16 2016-17 2017-18 2018-19 2019-20

53
Increase in Gross 2085.67 2157.72 2018.40 2207.90 2948.23

Block

Secured loans paid

19887.0 33439.07 39144.15 48468.98 53027.63

Unsecured loans 6200.51

17723.95 18595.52 20415.62 18895.58

CASH APPLICATIONS AND USES

Gross block has grown to Rs. 2948.23 in 2019-20, as shown in the table above. & Rs.
2207.90 in the current fiscal year. In 2014–15, secured loans paid Rs.19887.06, while
in 2019–20, secured loans paid Rs.53027.63. Unsecured loans paid Rs.6200.51 in the
2014-15 fiscal year and Rs.18895.58 in the 2019-20 fiscal year.

54
 CHAPTER-V

5.1 FINDINGS

55
• During the length of 2015-2020 extra than 74% of the coins got here from buying

and selling activities. In the utility of coins round 68% is applied for investing in

constant belongings.

• During the length 2014-2015 to 2019-2020 extra than 55.68% of the coins got here

from buying and selling activities. In the utility of coins round, 81.19% of the coins

are applied for investing in constant belongings

• During the length 2014-2015 to 2019-2020 extra than 69.54% of the coins got here

from buying and selling activities. In the utility of coins, 32.32% of the coins are

applied for investing in constant belongings

• During the length 2015-2017 to 2017-2018 extra than 47.74% of the coins got here

from buying and selling activities. In the utility of coins, 71.64% of the coins are

applied for investing in constant belongings.

• During the length 2017-17 to 2017-18 extra than 54.25% of the coins got here from

buying and selling activities. In the utility of coins, 71.64% of the coins are applied

for investing in constant belongings.

• During the length 2014-2015 to 2019-2020 extra than 58.96 % of the coins got here

from buying and selling activities. In the utility of coins, 75.61 % of the coins are

applied for investing in constant belongings.

5.2 SUGGESTIONS

56
For enhancing the economic overall performance of the employer the subsequent

recommendations are made.

• To lessen the outdoor borrowings withinside the employer has to acquire. The

capital from fairness sources. Keeping in view the debt-fairness the percentage is

normal.

• The liquidity of the employer needs to be advanced with the aid of using retaining

the most effective modern-day belongings and liquid belongings by traditional norms.

• The quantum of the income generated needs to be advanced impressively to reap a

better go back on investment.

• To enhance the economic fitness of the employer and maximizing the time among

the supply mobilization and usage the control should introduce brand new price-

saving techniques.

5.4CONCLUSIONS

57
• Dr. Reddy’s Laboratories et Profit is displaying terrible income withinside the yr

2019-2020. This occasion is a predicted one due to the fact from the preceding years

it's miles displaying the decline degree in Net Profit.

• Profit Margin of Dr. Reddy’s Laboratories lowering and displaying terrible income

due to the fact there may be a growth withinside the price.

• Dr. reddy’s laboratory et Working Capital Ratio is satisfactory.

• Dr. Reddy’s Laboratories go back on Total Assets suggests a terrible signal

withinside the yr 2008-14

• The Operating Ratio of dr. Reddy’s laboratory growth withinside the yr 2014-15,

withinside the yr 2015-17, and reached withinside the yr 2019-20 so the employer has

to lessen its running costs.

• The Operating coins of Dr. Reddy’s Laboratories satisfactory. Due to the growth

withinside the price of production, this ratio is lowering. So the has to lessen its

workplace management expenses

BIBLIOGRAPHY

58
BOOKS

FINANCIAL MANAGEMENT - I.M. Panday

FINANCIAL MANAGEMENT - Prasanna Chandra

FINANCIAL MANAGEMENT - M.Y. Khan & P.K. Jain

PRINCIPLES OF MANAGEMENT - Man Mohan &Goyal S.N.

FINANCIAL MANAGEMENT - Maheswari S.N.

JOURNALS:

American Journal Of Business Education – Fourth Quarter 2015

Improvements of the cash-flow statement control function in. 2008 vol. 26

NEWSPAPERS:

THE business Standard

The business times

WEBSITES :

www.googlefinance.com

www.financeindia.com

www.cashflowstatement.com

www.hero.com

59