Definitions: in The Earlier Years of Its Evaluation It Was Created Rising of Funds. in The

INTRODUCTION
In the earlier years of its evaluation it was created rising of funds. In the
current year literal pertaining to financial management is a border scope. So as to
include in additional to procurement of funds efficient of funds efficient of resources
in universally recognized. The term nature as applied to financial management refers
to its relationship with the closely related fields of economics and accounting its
functions, scope.
DEFINITIONS:
“Financial management is concerned with the efficient use of an important
economic resources namely capital funds”. –Solomon.
“Financial management is the application of the planning and control
function to the finance functions”. –Howard and Upon
Scope of finance:
Firm create manufacturing capacities for production of goods some provide
service to customers. They sell their goods or services to earn profit. They raise funds to
acquire manufacturing and other facilities. Thus the three most important activities of
business firm are:
 Production
 Marketing
 Finance
A firm as wheat ever capital it needs and employees it (finance activity) in activities
which generate returns on invested capital (production and marketing activities). So
financial management helps to the firm to take the correct decisions. And also helpful to
firm how to utilize the economic resources likely capital funds in the proper way. It is also
controlling tool to control the financial functions of the firm. So it is very important aspect
in every organization.
Meaning and types of financial statements:
A financial statement is an organized collection of data according to logical and
consistent accounting procedures. It purposes is to convey in understanding of some
financial; aspects of a business firm.
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Thus, the term ‘financial statements’ generally refers to two basic statements.
1. Income statement
2. Balance sheet
1. Income Statement:
The income statement may be prepared in the form manufacturing account to find
out the cost of the production, in the form of trading account to determine the gross loss in
the form of profit & loss account to determine the net profit or net loss.
If the profit is increasing year after year or it is higher than the other
competitors, it means the business is a profitable one. Otherwise it is better to switch over
to other lines or to close down. Similarly if the expenditure is more than the income then
there will be no loss. It means that the firm is losing the capital.
2. Balance sheet:
The balance sheet is one of the Important statement which shows the financial
position of the firm, measured in terms of assets & liabilities i.e., Balance sheet shows all
the assets owned by the firm on one side and on other side owners funds and other external
liabilities. The difference between the total assets and the external liabilities is known as
“Owners Equity”. If the owners equity is increasing over a period of time, it means.
Otherwis3 it will be a cause of financial insolvency
OBJECTIVES OF FINANCIAL STATEMENTS
Financial; statement are the sources of information on the basis of which
conclusions are drawn about the profitability and financial position of a concern. The
primary objective of the financial statement is to assist in decision making to those who
are interested in the financial affairs of the business enterprise. The accounting principles
board of America (APB) state that following objectives of financial statements.
To information about the working capital and other funds flow
To disclose, to the extent possible, other information related to the financial statements
that is relevant to its users.
To provide reliable financial information about economic resource and obligation of a
business firm i.e., cash inflows and cash outflows.
To provide other needed information about changes in such economic resource and
obligations. To provide a financial information the assist in estimating the earning of
potentials of the business
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INDUSTRY PROFILE
Srikalahasthi Pipes Ltd in India

India, being the second largest cement producer in the world after China with
a total capacity of 151.2 Million Tones (MT), has got huge Cement Company. With
the government of India giving boost to various infrastructure projects, housing
facilities and road networks, the cement industry in India is currently growing at an
enviable pace. More growth in the Indian cement industry is expected in the coming
years. It is also predicted that the cement production in India would rise to 236.16 MT
in FY14. It's also expected to rise to 262.61 MT in FY15.
The cement industry in India is dominated by around 20 companies, which
account for almost 70% of the total cement production in India. In the present year,
the Indian cement companies have produced 11 MT cement during April-September
2012. It took the total cement production in FY12 to 231 MT.
Industry Background:
The history of the cement industry in India dates back to the 1889 when a
Kolkata-based company started manufacturing cement from Argillaceous. But the
industry started getting the organized shape in the early 1900s. In 1914, Srikalahasthi
pipes Ltd India was established in Porbandar with a capacity of 10,000 tons and
production of 1000 installed. The World War I gave the first initial thrust to the
cement industry in India and the industry started growing at a fast rate in terms of
production, manufacturing units, and installed capacity. This stage was referred to as
the Nascent Stage of Indian Cement Company. In 1927, Concrete Association of
India was set up to create public awareness on the utility of cement as well as to
propagate cement consumption.
The cement industry in India saw the price and distribution control system in
the year 1956, established to ensure fair price model for consumers as well as
manufacturers. Later in 1977, government authorized new manufacturing units (as
well as existing units going for capacity enhancement) to put a higher price tag for
their products. A couple of year later, government introduced a three-tier pricing
system with different pricing on cement produced in high, medium and low cost
plants.
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Cement Production and Growth Domestic demand plays a major role in the
fast growth of cement industry in India. In fact the domestic demand of cement has
surpassed the economic growth rate of India. The cement consumption is expected to
rise more than 22% by 2012-13 from 2010-11. In cement consumption, the state of
Maharashtra leads the table with 12.18% consumption, followed by Uttar Pradesh. In
terms of cement production, Andhra Pradesh leads the list with 14.72%ofproduction,
while Rajasthan remains at second position.
Lanco Industries Limited Changes Name as Srikalahasthi Pipes
Limited.
The Board of Directors of Lanco Industries Ltd., has approved the proposal of
changing the name of the Company, subject to the approval of shareholders. The
shareholders have assented for changing the name of the company from Lanco
Industries Ltd., to Srikalahasthi Pipes Limited at the 22 nd Annual General Meeting of
the company held on September 27, 2014.
Subsequently, the Company has filed requisite from with Registrar of
Companies, Andhra Pradesh seeking its approval and accordingly Registrar of
Companies, Andhra Pradesh has issued fresh Certificate of Incorporation dated
September 29, 2014 changing the name of the company, pursuant to Rule 29 of the
companies (Incorporation) Rules, 2014.
The name of the company has been changed from Lanco Industries Ltd., to
Srikalahasthi Pipes Limited with effect from September 29, 2014.
Recent Investments in the Srikalahasthi Pipes Ltd

 In a recent announcement, the second largest cement company in South India,
Dalmia Cement declared that it's going to invest more than US$ 652.6 million
in the next 2-3 years to add 10 MT capacity.
 Anil Ambani-led Reliance Infrastructure is going to build up cement plants
with a total capacity of yearly 20 MT in the next 5 years. For this, the
company will invest US$ 2.1 billion.
 India Cements is going to set up 2 thermal power plants in Andhra Pradesh
and Tamil Nadu at a cost of US$ 104 billion.
 Anil Ambani-led Reliance Cementation is also going to set up a 5 MT
integrated cement plant in Maharashtra. It will invest US$ 463.2 million for
that.
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 Jaiprakash Associates Ltd has signed a MoU with Assam Mineral
Development Corporation Limited to set up a 2 MT cement plant. The
estimated project cost is US$ 221.36 million.
 Rungta Mines (RML) is also planning to invest US$ 123 million for setting up
a 1 MT cement plant in Orissa.
Types of Cement in India:

The types of cement in India have increased over the years with the
advancement in research, development, and technology. The Indian cement industry
is witnessing a boom as a result of which the production of different kinds of cement
in India has also increased.
By a fair estimate, there are around 8 different types of cement that are being
produced in India. The production of all these cement varieties is according to the
specifications of the BIS. Some of the various types of cement produced in India are:
 Clinker Cement
 Ordinary Portland Cement
 Portland Blast Furnace Slag Cement
 Portland Pozzolana Cement
 Rapid Hardening Portland Cement
 Oil Well Cement
 White Cement
 Sulphate Resisting Portland Cement
In India, the different types of cement are manufactured using dry, semi-dry, and
wet processes. In the production of Clinker Cement, a lot of energy is required. It is
produced by using materials such as limestone, iron oxides, aluminum, and silicon
oxides. Among the different kinds of cement produced in India, Portland Pozzolana
Cement, Ordinary Portland Cement, and Portland Blast Furnace Slag Cement are the
most important because they account for around 99% of the total cement production
in India.
The Portland variety of cement is the most common one among the types of
cement in India and is produced from gypsum and clinker. The Ordinary Portland
cement and Portland Blast Furnace Slag Cement are used mostly in the construction
of airports and bridges. The production of white cement in the country is very less for
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it is very expensive in comparison to grey cement. In India, while cement is usually
utilized for decorative purposes, marble foundation work, and to fill up the gaps
between tiles of ceramic and marble.
The different types of cement in India have registered an increase in
production in the last few years. Efforts must be made by the cement industry in India
and the government of India to ensure that the cement industry continues innovation
and research to come up with more and more varieties in the near future. For more
information click on following links:
Ordinary Portland cement:
Ordinary Portland Cement (OPC) is manufactured in the form of different

grades, the most common in India being Grade-53, Grade-43, and Grade-33. OPC is
manufactured by burning siliceous materials like limestone at 1400 degree Celsius
and thereafter grinding it with gypsum.
Tata Chemicals Limited is a major producer of OPC Grade 43 and 53. The
value of each of these grades of cement has been briefly mentioned below:
Ordinary Portland Cement-Grade 43: Having been certified with IS 8112:1989

standards, Grade 43 is in high demand in India and is largely used for residential,
commercial, and other building construction purposes. It has a compressive strength
of 560 kg per square cm. Today OPC 43 is most widely available in Gujarat through
an extensive distribution network.
 Ordinary Portland Cement-Grade 53: Having been certified with
IS12269:1987 standards, Grade 53 is known for its rich quality and is highly
durable. Hence it is used for constructing bigger structures like building
foundations, bridges, tall buildings, and structures designed to withstand heavy
pressure. Expert opinions and directions from technicians and engineers are a
must in this regard. With a good distribution network this cement is available
most abundantly in Gujarat.
 As such, Ordinary Portland Cement is used for quite a wide range of

applications. Some of the Ordinary Portland applications are in pre-stressed
concrete; dry-lean mixes, durable pre-cast concrete, and ready
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 Mixes for general purposes. The chemical components of Ordinary Portland
Cement are Magnesium (MgO), Alumina (AL2O3), Silica (SiO2), Iron
(Fe2O3), and Sulphur trioxide (SO3).
 Some of the big names involved in OPC manufacture are Tata Chemicals,
Ultratech Cement, and ACC cement. Ordinary Portland Cement is in great
demand in India and will continue to be used in Indian infrastructural
upgradation and other constructions.
Portland Pozzolana Cement:
Portland Pozzolana Cement is manufactured by blending pozzolanic materials,

OPC clinker, and gypsum either grinding them together or separately. Today Portland
Pozzolana Cement is widely in demand for industrial and residential buildings, roads,
dams, and machine foundations.
Pozzolana is an important ingredient in PPC which is commonly used in the form of:
 Fly ash
 Volcanic ash
 Silica fumes
 Calcined clay
PPC is resistant to harsh water attacks and prevents the formation of calcium
hydroxide at the time of cement setting and hydration. It withstands aggressive gases,
thermal cracks, wet cracking, etc. The BIS quality
Specifications for Pozzolana materials used in PPC have been mentioned below:
 Fly ash - IS 3812:1981
 Calcined clay - IS 1344:1981
PPC is used in heavy load infrastructure and constructions such as marine

structures, hydraulic structures, mass concreting works, plastering, masonry mortars,
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and all applications of ordinary Portland cement. One of the top Indian brands of
Portland Pozzolana is 'Shudh Cement' manufactured by Tata Chemicals Limited.
Shudh cement has 5 percent of the market share and is available abundantly in
Gujarat, penetrating all 3 - primary, secondary, and tertiary markets. Some of the
other big names in the Portland Pozzolana manufacture are Ultratech, Ambuja, ACC
cements, Star Cement, and Birla group.
Portland Pozzolana Cement is highly popular in India and with many cement
plants setting up jetties for transportation, initial costs would gradually decrease as
well.
Portland Blast Furnace Slag Cement:
In recent years, there has been a significant growth in the production of

Portland Blast Furnace Slag Cement and its sales have also increased considerably
over the last few years. This has given a major boost to the Indian cement industry.
The Slag Cement of the Portland Blast Furnace is a type of cement that is
hydraulic and is manufactured in a blast furnace where iron ore is reduced to iron. The
molten slag which is tapped is quickly drenched with water, dried, and then grounded
to a fine powder. This fine powder that is produced is commonly known as the
Portland Blast Furnace Slag Cement.
The manufacture of Portland Blast Furnace Slag Cement requires 75% less
energy than that needed for the production of the Portland cement. The low cost of
production of Portland Blast Furnace Slag Cement makes it cheaper than Portland
cement. It is for this reason that in recent years, the sales of Portland Blast Furnace
Slag Cement have increased.
Portland Blast Furnace Slag Cement has a typical light color and an easier
'finish' ability. Its concrete workability is better and it has a higher flexural and
compressive strength. It is resistant to chemicals and also has more hardened
consistency. This is the reason that Portland Blast Furnace Slag Cement is used in the
construction of dams, bridges, building complexes, and pipes.
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The various raw materials required for the production of Portland Blast
Furnace Slag Cement are:
 Limestone
 Iron Ore
 Iron Scrap
 Coke
The major companies producing Portland Blast Furnace Slag Cement in

India are:
 J K Cement
 Grasim Industries and Ultra Tech
 ACC
 India Cement Ltd
 Gujarat Ambuja Cement Ltd
The major countries where Portland Blast Furnace Slag Cement is exported
from India are:
 South Africa
 UAE
 Sri Lanka
 Nepal
 Bangladesh
 Australia
 Doha-Qatar
The production and use of Portland Blast Furnace Slag Cement have increased
over the years. The Indian government has undertaken several investments in the
production of the Portland Blast Furnace Slag Cement so that its quality and
durability can be improved
Oil Well Cement:
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Oil Well Cement as the name suggests, is used for the grouting of the oil wells,
also known as the cementing of the oil wells. This is done for both, the off-shore and
on-shore oil wells.
As the number of oil wells in India is increasing steadily, the sales of Oil Well
Cement have also increased. This has boosted the Indian cement industry to a large
extent.
Oil Well Cement is manufactured from the clinker of Portland cement and also
from cements that have been hydraulically blended. Oil Well Cement can resist high
pressure as well as very high temperatures. Oil Well Cement sets very slowly because
it has organic 'retarders' which prevent it from setting too fast. It is due to all these
characteristics that it is used in the building of the oil wells where the pressure is
around 20,000 PSI and the temperature is around 500 degrees Fahrenheit.
There are 3 grades of Oil Well Cements. Grades O is ordinary and is used
commonly; HSR is high sulphate resistant; and MSR is moderate sulphate resistant.
Each grade is used where it is applicable at a particular range of oil well sulphate
environments, temperatures, pressures, and depths. Oil Well Cement has proved to be
very beneficial for the petroleum industry due to its characteristics. For it is due to the
Oil Well Cement that the oil wells function properly.
The various raw materials required for the production of Oil Well Cement are:
 Limestone
 Iron Ore
 Coke
 Iron Scrap
The major companies manufacturing Oil Well Cement in India are:

 ACC
 Gujarat Ambuja
 India Cement Ltd.
 J K Cement.
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Rapid Hardening Portland cement:
Rapid Hardening Portland Cement (RHPC) is a type of cement that is used

for special purposes when a faster rate of early high strength is required. RHPC has a
higher rate of strength development than the Normal Portland Cement (NPC).
The Rapid Hardening Portland Cement's better strength performance is

achieved by increasing the refinement of the product. This is the reason that its use is
increasing in India.
Rapid Hardening Portland Cement is manufactured by fusing together
limestone (which has been finely grounded) and shale, at extremely high temperatures
to produce cement clinker. To this cement clinker, gypsum is added in small
quantities and then finely grounded to produce Rapid Hardening Portland Cement. It
is usually manufactured using the dry process technology.
Rapid Hardening Portland Cement is used in concrete masonry manufacture,
repair work which is urgent, concreting in cold weather, and in pre-cast production of
concrete. Rapid Hardening Portland Cement has proved to be a boon in the places
where quick repairs are required such as airfield and highway pavements, marine
structures, and bridge decks.
The Rapid Hardening Portland Cement should be stored in a dry place, or else
its quality deteriorates due to premature carbonation and hydration. As the Indian
cement industry produces Rapid Hardening Portland Cement in large quantities, it is
able to meet the domestic demand and also export to other countries. The cement
industry in India exports cement mainly to the West Asian countries.
The raw materials required for the manufacture of Rapid Hardening Portland
Cement are:
 Limestone
 Shale
 Gypsum
 Coke
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The major companies producing Rapid Hardening Portland Cement in India
are:
 ACC
 Gujarat Ambuja
 J K Cement
 Grasim Industries
 Indian Cement Ltd.
Sulphate Resisting Portland cement:
Sulphate Resisting Portland Cement (SRC) is a type of Portland cement in which

the quantity of tri calcium aluminates is less than 5%. It can be used for purposes
wherever Portland Pozzolana Cement, Slag Cement, and Ordinary Portland Cement
are used.
The use of Portland Sulphate Resisting Cement has proved beneficial,

particularly in conditions where there is a risk of damage to the concrete from
sulphate attack. The use of Sulphate Resisting Portland Cement is recommended in
places where the concrete is in contact with the soil, ground water, exposed to
seacoast, and sea water. In all these conditions, the concrete is exposed to attack from
sulphates that are present in excessive amounts, which damage the structure. This is
the reason that the use of the Sulphate Resisting Portland Cement have increased in
India.
The Sulphate Resisting Portland Cement should be kept in a place which is

dry otherwise through premature hydration and carbonation the quality of cement
deteriorates. The cement industry in India manufactures Sulphate Resisting Portland
Cement in large quantities so that it is able to meet the domestic demand and also
export to other countries as well. The Indian cement industry exports cement chiefly
to the West Asian countries.
The various uses of Sulphate Resisting Portland Cement are:
 Underground and basements structures
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 Works in coastal areas
 Piles and foundations
 Water and sewage treatment plants
 Sugar, chemical, and fertilizers factories
 Petrochemical and food processing industries
The raw materials required for production of Sulphate Resisting Portland

Cement are:
 Coke
 Limestone
 Iron Ore and scrap
The major companies manufacturing Sulphate Resisting Portland Cement in

India are:
 ACC
 J K Cement
 Indian Cement Ltd
 Grasim Industries and Gujarat Ambuja
Sulphate Resisting Portland Cement has proved beneficial for construction

purposes in India due to its climatic conditions. The Sulphate Resisting Portland
Cement should be stored in a dry place, or else its quality deteriorates due to
premature carbonation and hydration. As the Indian cement industry produces
Sulphate Resisting Portland Cement in large quantities, it is able to meet the domestic
demand and also export to other countries. The cement industry in India exports
cement mainly to the West Asian countries.
White Cement:
White Cement has registered growth in production and sale in India in the last
few years. The White Cement sector has been growing at the rate of 11% per year.
This has given the Indian cement industry a major boost.
White Cement is much like the ordinary grey cement except that it is white in
color. In order to get this color of the White Cement, its method of production is
different from that of the ordinary cement.
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The production of White Cement requires exact standards and so it is a product which
is used for specialized purposes. White Cement is produced at temperatures that hover
around 1450-1500 degrees Celsius. This temperature is more than what is required by
the ordinary grey cement. As more energy is required during the manufacture of
White Cement, it goes to make it more expensive than the ordinary grey cement.
White Cement is used in architectural projects the use of white cement has
been specified. It is used in decorative works and also wherever vibrant colors are
desired. White Cement is used to fill up the gaps between marble and ceramic tiles for
a smoother and more beautiful finish.
The various raw materials required for the production of White Cement are:
 Limestone
 Sand
 Iron Ore
 Nickel
 Titanium
 Chromium
 Vanadium
The major companies producing White Cement in India are:

 ACC and J K Cement
 Gujarat Ambuja Cement Ltd.

 India Cement Ltd.
The major countries where White Cement is exported from India are:
 UAE
 Australia
 South Africa
 Sri Lanka
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 Doha- Qatar
 Bangladesh
 Nepal
Clinker Cement:
Clinker Cement has registered a growth over the last few years in India. The
Indian cement industry is growing at a rapid pace and this has given a major boost to
the production and sale of Clinker Cement in India. The production of Clinker
Cement requires a lot of energy because it needs to be manufactured at the
temperature of around 1400-1450 degree Celsius.
The various raw materials required for the production of Clinker Cement are:
 Iron Ore
 Bauxite
 Clay
 Limestone
 Quartz
Clinker Cement in India is produced in such large quantities that it is able to

meet the domestic demand and is also exported. In 2001- 2002, 1.76 million tons of
clinker cement were exported. In 2002- 2003, that figure stood at 3.45 million tons,
and in 2003- 2004 5.64 million tons of clinker cement was exported from India. This
shows that the export of clinker cement from India has been increasing gradually but
steadily.
Clinker Cement is usually ground with calcium sulphate so that it becomes

Portland cement. It is also ground with other ingredients to produce Pozzolanic
Cement, Blast Furnace Slag Cement, and Silica Fume Cement. If Clinker Cement is
kept in a dry condition, it can be stored for a long period of time without any loss of
its quality. It is for this reason that Clinker Cement is preferred in the construction of
houses, bridges, and complexes.
The major companies producing Clinker Cement in India are:
 ACC
 Gujarat Ambuja Cement Ltd.
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 JK Cements
Industries Limited (LIL) was incorporated on 1st November, 1991 by Lanco

Group of Companies to manufacture Pig Iron using Korf (German) technology and
Cement. The unit is located at Rachagunneri Village on Tirupathi - /Srikalahasthi road
which is about 30 kms. From Tirupathi and 10 kms. From Srikalahasthi. The installed
capacity of Pig Iron was 90,000 TPA and with similar capacity 90,000 TPA for
cement.
Due to the poor demand and other reasons, the operations of the cement unit
of the Company was suspended and the unit was reengineered for producing a
different product mix having potential in south India.
As a measure of forward integration project for adding value to the Pig Iron
manufactured by the Company, LIL floated an another company named Lanco, Sri
Kalahasthi Castings Limited (LKCL) on 4th March 1997 to manufacture iron castings
and spun pipes in the same campus of the Company with an annual capacity of 40,000
TPA and 35,700 TPA respectively. Accordingly, LIL had an arrangement with LKCL
for supply of molten iron and Pig Iron to LKCL, being a value added product, as such
iron pipes manufactured by LKCL offered better returns.
However, due to falling Pig Iron prices, increase additional capacity in the
industry, competition and the technical & financial assistance, the operations of both
LIL and LKCL were affected and the Company was exploring financial and technical
strategic alliance with Indian / Foreign Partner.
During the same time M/s. Electro steel Castings Limited, SRIKALAHASTHI
PIPES LTD was also looking for additional capacities for producing spun pipes.
Considering the synergies involved, SRIKALAHASTHI PIPES Industries Limited
entered into a strategic alliance partnership during December 2002, with M/s. Electro
steel Castings Limited (ECL), Kolkatta a leading manufacturer of CI, Pipes and DI
pipes. This was win-win situation for both LIL and ECL. After takeover, a financial
re-engineering and re-structuring of LIL was undertaken by ECL by implementing the
following: -
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Immediately after take over an amount of Rs.2200 lakhs was infused as share
capital of the Company by M/s. ECL to strengthen the equity base of the
company.
During 2002, the capacity of Pig Iron was increased from 90,000 TPA to
150,000 TPA.
With effect from 1st April, 2003 LKCL was merged with the company to take
advantage of the close synergy in the business of the two companies, since a
large part of Molten Iron / Pig Iron is consumed by LKCL for manufacture of
DI Pipes.
After the merger, the share capital of LIL, the paid up share value of Rs.10/-
was reduced to Rs.2.50 per share and accordingly one share of Rs.10/- each
fully paid up in LIL was issued to all the existing shareholders for every 4
shares held by them
During 2003, the capacity of the DI pipes was increased to 90,000 TPA.
During 2004, the company took the step of backward integration by setting up
150,000 TPA coke oven plant in the same complex, which was commissioned
in June 2005.
During 2005, the company started setting up of a Captive Power Plant of 12

MW by using the waste heat recovered from the coke oven plant which is
expected to be commissioned by March 2006.
An additional amount of Rs.25 corers is being spent on other capital works

like revamping of bitumen coating machine, balancing equipment and
facilities for production of higher diameter DI pipes etc. to increase the
capacity of DI pipes from the present 90,000 TPA to 120,000 TPA by 2006-
07.
The above has resulted in the company witnessing a profitable years after a gap
of 8 years during the years ended 31st March, 2003, 2004 and 2005 and a dividend of
10% was declared for the years ended 31st March 2004 and 2005 to the shareholders.
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Step by Step Company's Growth:
1991 Incorporation of Srikalahasthi Pipes Ltd
1994 Setting up of Mini Blast Furnace with 90,000 TPA capacity
1995 Setting up a 250 TPD Mini Cement Plant
1997 Setting up of LKCL for manufacture of 40,000 TPA castings and

35,700 TPA D I Pipes
2002 Strategic Alliance with Electro steel Casting Limited

2002 Infusion of Rs.2200 lakhs to the equity and financial restructuring
2003 Merger of LKCL with LIL for synergy
2003 Capacity of Pig Iron was increased to 90,000 TPA to 150000
TPA.
2004 Capacity of DI Pipes was increased to 90,000 TPA.
2005 Commissioning of 150,000 TPA coke oven plant.
2005 Setting up of Captive Power Plant of 12 MW by using the waste heat
recovered from the coke oven plant.
2006 Capacity of D.I.Pipes was further increased from 90,000 TPA to 1,20,000
TPA and the 12 MW Waste Heat Recovery Based Co-Generating
Captive Power Plant was set up, which started generating power from
March, 2007.
2007 Stamp Charging System was successfully implemented at Coke Oven

Plant for producing quality metallurgical coke at a lower cost.
2008 Company implemented ERP system (SAP) to support business process and
effective resource planning and management.
2009 Capacity of D.I. Pipes was increased from 1,20,000 TPA to 1,80,000 TPA
2010 Capacity of Mini Blast Furnace (MBF) for production of Liquid Metal/Pig
Iron was enhanced from 150,000 TPA to 225,000 TPA and also the capacity
of DI Pipes was enhanced from 180,000 TPA to 225,000 TPA with a capital
outlay of about Rs.45 Crores.
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COMPANY PROFILE
Pig Iron Project was conceived in 1992. Commercial production started in

September 1994. Capacity:- 90,000 TPA at inception
Cement division started commercial production in 1996
Spun Pipe Project conceived in March 1998 and commercial production
commenced in January 2000. Capacity:-60,000 TPA at inception.
ECL joined as strategic partner in 2002 / LKCL Merged with LIL in 2003
New 1,50,000 TPA Coke Oven Plant Commissioned in 2005
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“An integrated industrial complex for manufacture of DI Pipes”
Expansion/New Projects after Take-over: Investment Rs. 175 Crs.
Spun Pipe Division : Capacity increased from 60,000 TPA to 90,000 TPA
Pig Iron Division : Capacity increased from 90,000 TPA to 1, 75,000 TPA
Coke Oven Division : New Plant with a Capacity of 1,50,000 TPA
12 MW Capacity Power Plant : Expected Commissioning by End May'07
ABOUT SRIKALAHASTHI PIPES LTD

With its headquarters in Hyderabad, US$500 million asset –based
SRIKALAHASTHI PIPES LTD Group is one of the leading business houses in India.
It has operations in the United States as well. SRIKALAHASTHI PIPES LTD is
diversified into Power Generation, Power Trading, Information Technology,
Engineering and Construction, Property Development and Manufacturing.
Power Generation
 Thermal Power
 Wind Power
 Biomass Power
 Hydro Power
Information Technology
Civil Construction
 Water Infrastructure
 Road and Building
 IT Parks
 Property Development
 Manufacturing
 Pig iron
20
 Slag Cement
 Ductile Iron Spun Pipes
 Metallurgical Coke
FOUNDER & CHAIRMAN

L. Rajagopal, a technocrat-turned industrialist, is the Founder Chairman of
SRIKALAHASTHI PIPES LTD Group. Established in 1989, the Group’s activities
range from Power Generation, Engineering and Construction, Manufacturing to
Information Technology. Under his dynamic leadership, the Group’s capital outlay
has touched US$450 million and his recognized as one of the leading players in the
infrastructure sector in India.
Service to Society:
In additional to his entrepreneurial spirit, Rajagopal has a strong sense of
social responsibility. He established SRIKALAHASTHI PIPES LTD Institute of
General Humanitarian Trust (LIGHT), a Charitable Trust, in 200 to reach out to the
needy and has been involved in various philanthropic activities.
Member of Parliament:
After one-and-a-half decades of outstanding contribution to the industry,
Rajagopal chose to enter public life in 2003. He contested the recent elections to the
Lower House of parliament from Vijayawada constituency and won a landslide
victory. As a Member of Parliament, his avowed mission is to make a difference in
public life.
COMMITTEE OF SRIKALAHASTHI PIPES EXECUTIVES AND

DIRECTORS:
1 Shri. Mayank Kejriwal Managing Director
2 Shri. G.Maruthi Rao Director
3 Shri. Gouri Shankar Rathi Director
4 Shri. S.Y. Rajagopalan Director
5 Shri. L.Madhusudhan Rao Director
6 Shri. G.Bhaskara Rao Director
7 Shri. L.Sridhar Director
8 Shri. P.M.Suresh Nominee of IDBI
21
9 Shri. V.Nagi Reddy, IAS Nominee of APIDC
POWER PROJECTS
With operational experience in gas, wind and biomass-based power projects
and a strong foothold in coal and hydropower generation, SRIKALAHASTHI PIPES
LTD is emerging as a key player in the Indian power sector.
INFORMATION TECHNOLOGY
LGS is a strategic initiative to provide world-class Information Technology
solutions to global costumers, delivering them maximum business value through
continuous innovation.
CIVIL CONSTRUCTION
Power projects, industrial structures, institutional facilities, mass housing,
water supply projects, flyovers and bridges – such varied operations serve to explicate
the diversification roadmap of SRIKALAHASTHI PIPES LTD.
PROPERTY DEVELOPMENT
Being a Pioneer in civil Construction and Infrastructure Development,
SRIKALAHASTHI PIPES LTD is venturing into Property Development with the
winning of the bid for IT Parks – cum – Commercial and Residential Complex in
Hyderabad and Visakhapatnam of Andhra Pradesh.
MANUFACTURING
Being one of the largest integrated foundries in India with Ductile Iron Spun
Pipes, Metallurgical Coke, Pig Iron and Slag Cement as productions,
SRIKALAHASTHI PIPES LTD has a towering presence in the Indian manufacturing
sector.
SRIKALAHASTHI PIPES LTD GLOBAL SYSTEMS LTD (LGSL)
ABOUT LGS
Information Technology services is a strategic initiative of
SRIKALAHASTHI PIPES LTD Group to provide world-class Information
22
Technology solutions to global customers, delivering them maximum business value
through continuous innovation.
IT solution and services are delivered to global customers through
Srikalahasthi pipes ltd Global System Inc (LGSI) headquartered in Atlanta, GA, the
US and Srikalahasthi pipes ltd Global Systems Limited (LGSL) based in Hyderabad,
India. The organization specializes in designing and implementing IT solutions and
services aligned to business needs of customers.
LGS delivers a portfolio of services and solutions that help clients embrace
speed, transform their enterprises, respond quickly to opportunities, protect their
physical and digital assets and go to market ahead of their competitors. The array of
offerings includes.
 Technology Strategy Consulting.
 Application Development
 Conversion and Migration
 Tools/Technology Based Implementation Services
 Business Intelligence Solutions
 Application Management Services
 IT Infrastructure Services
 Optimized Offshore Solution Frameworks
The varied services are backed by decades of experience of the Group’s

businesses in servicing clients worldwide in major industries, including Energy,
Manufacturing and Engineering and Infrastructure Development.
The organization’s Functional and Technical Strengths, Flexible Business
Models, Human and Structural Capital are all focused on maximizing Business Value
to customers worldwide.
SRIKALAHASTHI PIPES LTD INSTITUTE OF GENERAL
HUMANITARIANT TRUST (LIGHT):
Beyond capital investments, the operations of any corporate do entail social
costs as well as social benefits. Social responsibility begins with good
governance, efficient utilization of resources and protection of stakeholder and
consumer interests. It is for a successful corporate to take initiatives for socially
relevant activities and causes.
23
It is this realization that has led SRIKALAHASTHI PIPES LTD Group to set
up SRIKALAHASTHI PIPES LTD Institute of General Humanitarian Trust (LIGHT)
in 2000. In a short time, the Trust has succeeded in making its presence felt in the
social service sector through its various programmers.
SRIKALAHASTHI PIPES INFRATECH LTD.
SRIKALAHASTHI PIPES INFRATECH limited was established in 1993
with an annual turnover of about Rs.200 corers (US $ 40 million). The company is a
leader in infrastructure sector in roads, Water, & also undertakes large housing &
industrial projects.
Areas of Specialization
 Mass Housing
 Institutional Buildings
 Industrial Structures
 Water Supply
 Flyovers and Bridges
 Roads
 Water treatment Plant
 Sewage Treatment Plant
 Interiors
 Infrastructural Developments
 Hydro / Thermal Power Projects
 Dams & Irrigation Projects
 Marine Works
PRODUCT PROFILE
SRIKALAHASTHI PIPES KONDAPLLI POWER PVT. LTD.
Srikalahasthi pipes ltd Kondaplli Power is an Independent Power Project
(IPP) located at kondaplli Industrial Development Area near Vijayawada in Krishna
District (A.P), India. The project cost is Rs.11, 000 million (US $ 275 Million). The
plant is 368.144 MW Combined Cycle Power Project operating Natural Gas.
LKPPL is Co-promoted by NRG Energy Corporation. USA, Common
Wealth Development Corporation (CDC), UK & Dosan Heavy Industries &
Construction Company Ltd., (Korea).
24
The project has 2 Gas Turbines of GE Frame 9E. 2 Heat Recovery Steam
Generators & 1 Stream Turbine.
The company supplies Power to Transmission Corporation of Andhra
Pradesh Limited (AP TRANSCO) & has entered into a Power Purchase Agreement
(PPA) for 15 years. The plant can also operate on liquid fuels like Naphtha, speed
Diesel (HSD), etc
PROMOTERS & EQUITY PARTNERS:
SRIKALAHASTHI PIPES LTD Kondapalli Power Pvt. Limited, has set up
the power project at kondapalli Industrial Development Area (IDA), Krishna Dist in
the state of Andhra Pradesh, India, at a cost of Rs.11,000 Millions(US $ 275 Millions
at 1 USD = Rs. 40). This power project is promoted by SRIKALAHASTHI PIPES
LTD Group of India and is co- promoted by NRG Energy Inc., USA (Worlds 5th
largest power Generation Company). United Kingdom and Dosan Heavy Industries &
Construction Co. Ltd (DOOSAN) (erstwhile HASNUNG), Korea are the other equity
partners.
POWER DISTRIBUTION
Srikalahasthi pipes ltd Power Group is very serious of exploiting the
lucrative emerging business opportunity of Distribution of Electric Power i.e.,
formation / takeover of Electric Utilities in India.
The aggressively reforming state of Andhra Pradesh is on the way of
privatization of all the four Power Distribution Companies in its fold.
The Srikalahasthi pipes ltd Group with its rich experience in power sector,
with first hand local knowledge, connections, and strong local presence in the state of
Andhra Pradesh is advantageously positioned it self to take over the Distribution
Companies.
Srikalahasthi pipes ltd Group power division is interested to have tie up
with experienced foreign partners to exploit this emerging and growing business
opportunity.
MANUFACTURING PROCESS – CEMENT
25
Cement is manufactured at LIL to profitably make use of the slag from the
MBF. Hence a mini cement manufacturing facility has been conceived. Out of various
processes available for mini cement plants, Vertical Shaft Kiln (VSK) process is
found to be more viable & economical, hence it is more popular. Accordingly VSK
process has been chosen
Srikalahasthi pipes ltd Cement is the result of a

unique blend of slag and clinker with the
following destructive characteristics.
Progressively increasing later stage strength.

100% no leakage & no honey combing on application.
Low heat of hydration, very low pore volume in concrete, high impermeability,
resulting in structures of high strength & long life.
Crack free structure & walls, result of low thermal stresses and absence of
differential volume change.
Super resistance to sulphate in concrete, resultant low corrosion, less alkali
aggregate reaction, and final outcome of long lasting super finish surfaces.
East workability with high concentration of fines.
Crushing and grinding:

Limestone obtained from the mine in boulders form of 8 to 10 inch size is
crushed in crushers to 10 mm size. The same, along with coke fines (15 to 20% of
clinker), clay and iron ores are fed into a raw mill (usually a ball mill) & ground into
powder & stored in silos. Chemical composition of all materials & size distribution
are checked at every stage.
Nodulizing:
26
In VSK technology of cement manufacturing, nodulizing is the most important
step. Nodulization means agglomeration of all uniform small size particles to form
large nodules. Since fuel is underground in the raw meal, for uniform sintering
(clinkering) nodulization is very important & critical.
Nodulization is done in a specially designed dish revolving at an angle.
Ground raw meal is fed to the dish which is revolving & water is sprayed to convert
the powder into globules called nodules. Perfect nodulization is achieved by having
proper size of fuel, size of dish, angle of inclination of dish & the spread of water jets
sprayed.
Clinkering:
Nodules made, called the black meal, are fed into the vertical shaft kiln. The nodules
are converted into clinker by sintering of the meal by blowing control air supplies by
root blower. The various zones of reactions starting from the top of the kiln are the
drying zone, calcimine zone, sintering zone & cooling zone. Clinker thus made is
stacked in hoppers, using belt conveyors.
Slag drying:
Usually, the slag coming out of slag granulation plant of a
blast furnace or MBF has a moisture content of 20 to 25%. It needs
to be dried before grinding. A rotary dryer is installed for this
purpose which uses hot flue gas from the air pre heaters of MBF.
Cement Grinding:
Clinker, gypsum & slag are fed into the cement mill (ball mill), after passing
through proper weighing & feeding mechanism. The grinding steel balls grind the
cement to required fineness. Over size materials will return for regrinding. Gypsum is
added in the range of 2 to 3% to regulate the setting property of cement.
Packing:
27
The cement stored in silos is packed in bags of 50 Kgs using an automatic
double sprouted packing machine
Quality Control:
Tests are carried-out at every stage for required chemical & physical
properties such as composition, strength, fuel value, setting properties, notarization,
roundness etc. Cement is manufactured to national standards.
Dust control:
Since fine material is handled after crushing, bag dust filters are installed at
raw mill grinding, slag drying, clinker transporting, cement grinding & cement
packing.
Pipes manufacturing unit:
MISSION & VISION

MISSION
We aim to be world class, committed to customer satisfaction and
to encourage the spirit of leadership amongst our dedicated team by creating a healthy
environment for continuous growth, profit and prosperity.
VISION
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We are in the business of manufacturing pipes for conveying safe drinking
water and other fluids for domestic and overseas markets. For sustained growth we
intend to venture into related businesses in the area of
1. Suitable horizontal and vertical integration projects.

2. Turnkey projects.
3. Engineering & consultancy
4. Build-own-operate-transfer projects and diversify into new areas of

business including infrastructure related projects.
We will achieve the above through:

 Continuous technological up-gradation & absorption of new technology
 Effective team based working.
 Continuous training & human resources development.
 Developing ancillary unit
 Cost competitiveness
29
REVIEW OF LITERATURE
INTRODUCTION:
The term Working Capital refers to firm’s investment in short term assets such
as short-term securities, accounts receivables and inventories.
Working capital is the fund available for meeting the Day-to-day requirements
of an enterprise.
CONCEPTS OF WORKING CAPITAL:

There are two concepts of Working Capital. They are:
 Gross Working Capital.
 Net Working Capital.
GROSS WORKING CAPITAL:

It refers to firm’s investment in total current (or) circulating assets. This
concept focuses attention on two aspects of current assts management.
 Optimum Investment in Current Assets.
 Financing of Current Assets.
NET WORKING CAPITAL:

The term Net Working Capital has been defined in two different ways:
1. It is the excess of current assets over current liabilities.
Net Working Capital can be Positive (or) Negative:

 A Positive Net Working Capital will arise when Current Assets
exceeds Current Liabilities.
 A Negative will arise when current liabilities exceed Current assets.
2. It is that portion of firm’s Current Assets which is financed by long-term
funds.
30
KINDS OF WORKING CAPITAL:
Working Capital can be classified under the following heads:
Permanent of Regular and Variable Working Capital:
The need for current assets arises because of the operating cycle. The
operating cycle is a continuous process, and therefore, the need for current assets is
felt constantly. But the magnitude of current assets needed is not always same it
increases over time. However, there is always a minimum level of current assets,
which is continuously required by the firm to carry on its business operations. This
minimum level of current assets is refereed to as permanent of fixed working capital.
Depending upon changes in production and sales, the need for working capital, over
and above permanent working capital, will fluctuate.
Short-term or Temporary or Variable Working Capital is the amount of

working.
Capital which is required to meat the seasonal demand and some special
exigencies. Variable working capital can be further classified as seasonal working
capital and special working capital. Most of the enterprises have to provide additional
working capital to meet the seasonal special needs. The capital required to meet the
seasonal needs of the enterprise is called seasonal working capital. Special working
capital is that part of working capital which is required to meet special exigencies.
Permanent working capital stables over time, while temporary working capital
fluctuate according to the volume of production and sales. But permanent working
capital need not be fixed always; when the firm is continuously growing fixed capital
needs may also increase. The position with regard to the permanent working capital
and variable working capital can be shown with the help of the following figures.
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Amount of Working
Temporary
Permanent
Time
Amount of Working
Temporary
Permanent
Balance Sheet Working Capital: Time
Permanent and Temporary Working

The balance sheet Working Capital is calculated from the items appearing in
the balance sheet. Gross Working Capital is represented by current assets, and the
excess of current assets over current liabilities represents net working capital.
32
Cash Working Capital:
Cash Working Capital is calculated form the items appearing in the profit and
loss account. It shows the real flow of money or value at a particular time and is
considered to be the most realistic approach in working capital management.
Negative Working Capital:

When current liabilities exceed current assets, such a situation is termed a
deficit of Working Capital. Kennedy and MuMullen observe. “A working Capital
deficit exists if current liabilities exceed current assets”.
Nature of Working Capital:

Working Capital Management is connected with its problems that arise in at
tempting to manage the current assets, the current liabilities and the interrelation ship
that exists between them the term current assets refer to those assets, which in the
ordinary course of business can be converted into cash with in one year with the
undergoing of the firm. The major,
Current Assets are: Cash, Marketable Securities, Accounts receivables, Inventory,

prepaid expenses etc.
Current Liabilities are: Accounts payable, bills payable, Bank overdraft, out
standing expenses etc.
The goal of working capital management is to manage the firm’s current
assets, and liabilities in such a way that a satisfactory level of working capital is
maintained. This is so because if the firm cannot maintain a satisfactorily level of
working capital, it is likely to become and may even be forced into bankruptcy. The
current assets should be large enough to cover its current liabilities in order to ensure
a reasonable margin of safety. Each of the current assets must be managed efficiently
in order to maintain the liquidity of the firm while not keeping too high a level of any
one of them. Each of the short-term sources of financing must be continuously
managed to ensure that they are obtained and used in the best possible way.
Therefore the main theme of the theory of working management.
33
The basic ingredients of the theory of working capital management may be
said to include its definition, need, and optimum level of current assets. The trade off
between profitability and risk, which is associated with the level of current assets and
liabilities, financing, mix strategies and so on.
NEED FOR WORKING CAPITAL:

The need for working capital cannot be over emphasized. Every business
needs some amount of working capital. The need for working capital arises due to the
time gap between production and realization of cash from sales. There is an operating
cycle involved in the sales and realization of cash. There are time gaps in purchase of
raw materials and production; production and sales; sales and realization of cash.
Thus, working capital is needed for the following purposes:
1. For the purchase of raw materials, components spare.
2. To pay wages and salaries.
3. To incur day-to-day expense and overhead costs such as fuel, power and office
expenses etc.,
4. To meet the selling costs as packing and advertising etc.
5. To provide credit facilities to the customers.
6. To maintain the inventories of raw materials, work –in –progress, stores and
spare and finished stock.
34
CONCEPT OF OPERATING CYCLE:
Operating cycle is a process of investing cash in raw materials and converting
them into semi finished goods they finished goods then into receivable through sale
and transforming receivable into cash as illustrated in the following diagram:
Cash
Receivables Raw Material
Work in Process
Finished Goods
The operating cycle of a manufacturing company involves 3 phases:
1. Acquisition of Resources: Such as raw material, labor, power etc.

2. Manufacturing of the Product: Conversion of raw material into work into
work in progress into finished goods.
3. Sale of the Product: Time required t convert raw material into finished foods
and to convert receivable into cash determines the amount of working capital
required – Time.
35
FACTORS DETERMINING WORKING CAPITAL
Nature of Industry: Based on the size of the industry, a company requires assets.
Small companies have smaller amounts of inventory and have smaller proportions of
cash than large companies.
Demand of Industry: Creditors want that their demands be taken care of as the
fluctuating nature of demand of the industry.
Cash requirements: Cash is one of the current assets, which is essential for
successful operating of the production cycle. Hence, cash should be utilized properly.
Nature of business: Working capital requirements very much demand upon the
general nature or type of business.
Time: The level of working capital is depending upon the time required to
manufacturing goods. If the time is longer, the size of working capital will increase.
Volume of Sales: The volume of sales and size of working capital are directly related
to each other. As volume of sales increases, investment in working capital increases.
Inventory Turnover: A better inventory control will help the firm reduce its
working capital requirements.
Receivable Turnover: Prompt collection of receivables and good facilities for

settling payables results into low working capital requirements.
Business Cycle: Working capital requirements increase when the business is doing
well or on a use and less during periods of depression.
Attitude of Risk: The greater the amount of working capital, the lower the risk of
liquidity.
36
Size of the firm: Bigger firms, with many sources of funds, may need less working
capital as compared to their total assets or sales.
Operational and Financial Efficiency: Working capital turnover is improved with

better operational and financial efficiency of a firm with more turnover, working
capital requirements can be reduced.
Seasonal fluctuation: Seasonal fluctuations increase or decrease the working capital

requirement.
Inflation: As inflation uses, working capital size is increased in order for firms to
achieve better cash inflows.
TYPES OF WORKING CAPITAL

Working capital can be divided into two categories on the basis of time.
1. Permanent (or) Fixed Working Capital

2. Temporary (or) Variable Working Capital
Working Capital
Permanent (or) Fixed Temporary (or) Variable
Regular Seasonal Special

Reserve
37
1. PERMANENT WORKING CAPITAL
This refers to that minimum amount of investment in all current assets which
is require at all times to carry out minimum level of business activities. In other
words, it represents the current assets required on a continuing basis over the entire
year.
A. Regular Working Capital:

It is the minimum amount of working capital required to ensure circulation of
current assets from cash to inventories, from inventories to receivables and
receivables to cash and so on.
B. Reserve Working Capital:

It is the excess amount over the requirement for the regular working capital
which may be provided for contingencies that may arise at unstated periods such as
strikes, arise in prices, depression etc.,
2. TEMPORARY WORKING CAPITAL

The amount of working capital keeps on fluctuating from time to time on the
basis of business activities. In other words, it represents additional current assets
required at different times during the operating year.
A. Seasonal Working Capital

The capital require to meet the seasonal needs of the enterprise is called
seasonal working capital.
B. Special Working Capital
Special working capital is that part of working capital which is required to
meet special exigencies such as launching of extensive marketing companies for
conducting research etc.,
38
ESTIMATION OF WORKING CAPITAL REQUIREMENTS
Estimation of working capital requirements is not an easy task and a large
number of factors have to be considered before starting this exercise. For a
manufacturing organization, the following factors have to be taken into consideration
while making an estimate of working capital requirements.
1. Total cost incurred on materials, wages and overheads.

2. The length of time for which raw materials are to remain in stores before they
are issued for production.
3. The length of the production cycle or work-in-process, i.e., the time taken for
conversion of raw materials into finished goods.
4. The length of sales cycle during which finished goods are to be kept waiting
for sales.
5. The average period of credit allowed to customers.
FINANCING OF WORKING CAPITAL
The working capital requirements of a concern can be classified as:
a. Permanent of Fixed working capital requirements.

b. Temporary or Variable Working Capital requirements.
The various sources for the financing of working capital are as follows:
SOURCES OF WORKIING CAPITAL
Permanent or Fixed Temporary or Variable
1. Shares 1. Commercial Banks

2. Debentures 2. Trade Credits
3. Public Deposits 3. Installment Credit
4. Plugging back of profits 4. Advances Accounts
5. Loans from Financial receivable credit39
Institutions
ESTIMATION OF CURRENT ASSETS
Raw Material Inventory: The investment in raw materials inventory is estimated on

the basis of the following formula.
Budgeted Cost of Raw Material Average Inventory

Production Per Unit Holding Period (Month/Days)
_____________________________________________________________________
12 Months / 365 Days
Work in Process (W-I-P) Inventory: The relevant costs to determine work-in-

progress, inventory are the proportionate share of cost of raw materials and
conversion cost labour charges and manufacturing overheads excluding depends.
Budgeted Production Estimated work- in-progress Average Time

(Units) Cost per Unit Work-in-Progress
Inventory (Month / Days)
___________________________________________________________________
12 Months / Days
Finished Goods Inventory: Working Capital required to finance the finished goods
inventory is given by the following equation.
Budgeted Cost of goods Product Finished Goods

Production (Units) Per Unit (Excluding Depression) Holding Period (Month/days)
_____________________________________________________________________
Debtors: The Working Capital tied up in debtors should be estimated in relation to

total price (excluding depression) symbolically.
Budgeted Cost of Sales Average Debt Collection

Credit Sales Per unit excluding Period (Months / Days)
Depression
____________________________________________________________________
40
Cash and Bank Balances

A part from working capital needs for financing inventories and debtors, firms
also find it useful to have some minimum cash balances with them. It is different to
lay down the exact procedure of determining such an amount this would primarily be
based on the motives for holding cash balances of the business firm, attitude of
management towards risk, the access to the borrowing sources in time of need and
past experience, and so on.
DESTIMATION OF CURRENT LIABILITIES

The working capital needs of business firms are met through. The current
liabilities (Other than Bank Credit) arising in the ordinary course of business. The
important current liabilities, in this context are creditors, wages and overheads.
Trade Creditors
Budgeted Yearly Raw Material Credit Period allowed

Production Requirement per unit by Creditors (Months / Days)
_____________________________________________________________________
Direct Wages
Budgeted Yearly Direct Labour Average time lay in

Production Cost per unit Payment of wages (Month / Days)
_____________________________________________________________________
12 Months / Days
The average credit period for the payment of wages approximates to a half-a-
month in the case of monthly wage payment.
41
CONSTITUENTS OF WORKING CAPITAL
Working Capital has two constituents i.e.,
1. Current Assets and
2. Current Liabilities
CURRENT ASSETS
Current assets refer to those assets, which are easily convertible into cash
within a year.
Examples of Current Assets Are:

1. Cash in Hand
2. Bills Receivable
3. Cash & Bank Balances
4. Short-term loans and advances
5. Sundry Debtors
6. Inventories of Stocks
a. Raw Materials
b. Work-in-Progress
c. Stores and Spares
d. Finished Goods
7. Temporary Investments of Surplus funds
8. Prepaid Expenses
9. Accrued Incomes
CURRENT LIABILITIES
Current Liabilities are those liabilities, which are due to payable within a year.
EXAMPLES OF CURRENT LIABILITIES
1. Bills Payable
2. Sundry Creditors (or) Accounts Payable
3. Accrued (or) Outstanding Expenses
4. Short-term loans, Advances and Deposits
5. Dividends payable
6. Bank overdrafts
7. Provision for taxation if it does not amount to appropriation of profits.
42
RESEARCH METHODOLOGY
SOURCES OF DATA
The data required for the project work is collected from the period 2013-2018.
Primary Data:
‘First hand information was collected from experts of financial department, on

the basis of which actual position of the company is identified.
Secondary Data:
The secondary data is collected from the following sources:

 Annual financial reports of the company.
 Internal reports of the company.
 Broachers and Books of the company.
43
NEED FOR THE STUDY
 The study has been conducted for gaining practical knowledge about working
capital management &activities of sri kalashathi pipes ltd
 The study is on internal financing pattern of the working capital management
which deals with determining size of working capital needs to achieve certain
long-term operating goals.
 Therefore, an analysis is to be made to know the reasons & find out the
measures to be taken to make successful.
44
SCOPE OF THE STUDY
 The main scope of the study was to put into practical the theoretical aspect
in to real life work experience.
 The yearly increase or decrease of currents assets or current liabilities in the
budget of Srikalahasthi Pipes Ltd., is being reviewed.
 The study of working capital is based on tools like ratio analysis, statement
of changes in working capital.
 Further the study is based on last 5 years annual reports of sri kalashathi
pipes ltd.
 This also deals with key ratio’s to obtain a clearer picture of different
resources available and at the disposal of the organization, which will enable
one to give appropriation suggestion to the company to improve is
performance, if any.
45
OBJECTIVES OF THE STUDY
The main objectives of the study of working capital management in

Srikalahasthi Pipes Ltd., are as follows:
 To study the sources and uses of the working capital.

 To study the liquidity position through various working capital related ratios.
 To study the working capital components such as receivables accounts, cash
management, inventory management.
 To study the financial position the company.
 To examine the overall working capital analysis of the firm.
 To make suggestions based on findings of the study.
46
LIMITATIONS OF THE STUDY
 The study duration (summer in plant) is short.

 Some of the needed secondary data were not provide by the company.
 Limited interaction with the concerned heads due to their busy schedule.
 The analysis is limited to just five years of date study from (2013 to 2018)
 The information available in the balance sheets has been taken from the
published Annual Reports, so it has its own limitation in form of non-
availability of information of exceptional transaction.
47
DATA ANALYSIS & INTERPRETATION
1. STATEMENT OF CHANGES IN WORKING CAPITAL
Table: 4.1
Particulars 2013-14 2014-15 Changes in Working Capital
Increase Decrease
Current Assets (CA)
Inventories 2752.55 1193.25 - 1559.29
Sundry Debtors 2619.99 2011.67 - 608.32
Cash and Bank Balances 1669.88 629.03 - 1040.85
Loans and advances 332.21 338.81 6.59 -
Total Current Assets 7374.65 4172.77 - 3201.88
Current Liabilities (CL)
Current Liabilities 3536.64 2828.57 708.07
Provisions 40.39 66.55 26.15 -
Total Current Liabilities 3577.04 2879.51 - 697.53
Net current assets (CA-CL) 3797.61 1277.65 - 2519.96
Increase or decrease in - 2519.95 2519.95 -
working capital
Total working capital 3797.62 3797.62 3234.63 3234.63
Net Decrease in Working Capital 2519.95
INTERPRETATION:
From the above table is observed that the networking capital of the company
shows decreasing trend. The total current assets of the company have decreased from
Rs.7374.65 in 2013-2014to Rs.4172.77 in 2014-15.
Table: 4.2
48
Increase Decrease
Current Assets (CA)
Inventories 1193.26 5294.05 4100.79 -
Sundry Debtors 2011.67 4098.66 2086.99 -
Total Current Assets 4172.78 11302.96 7130.18 -
Current Liabilities 2828.58 5052.57 2223.99 -
Provisions 66.55 527.72 461.17 -
Total Current Liabilities 2895.13 5625.29 2730.16 -
Net current assets(CA-CL) 1277.65 5677.67 4400.02 -
Increase or decrease in 4400.02 - - 4400.02
working capital
Net increase in the working capital is 4400.02
INTERPRETATION:
shows increasing trend. The total current assets of the company have increased from
Rs.4172.78 in 2014-15to Rs.11302.96 in 2015-16.
But the bank balance decreased from Rs. 629.04 to Rs.447.49 i.e., 181.55.
The total current liabilities decreased from Rs.2828.58 to Rs.5052.57. The net
working capital increases Rs. 4400.02.

Table: 4.3
Increase Decrease
Current Assets (CA)
Inventories 5294.05 7075.18 1781.13 -
Sundry Debtors 4098.66 7197.89 3099.23 -
Provisions 527.72 586.14 58.42 -
49
Net current assets(CA-CL) 5677.67 7460.95 -1783.28 -
Increase or decrease in - 1783.28 - 1783.28
working capital
INTERPRETATION:
Rs.11302.96 in 2015-16 to Rs.16137.54 in 2016-17.
But the bank balance decreased from Rs.447.49 to Rs.247.72 i.e., 199.77. The
total current liabilities increased from Rs. 5677.67 to Rs.8676.59. The net working
capital increases Rs.1783.28.

Table: 4.4
Increase Decrease
Current Assets (CA)
Inventories 7075.18 9194.08 2118.9 -
Sundry Debtors 7197.89 6706.59 - 491.3
Cash and Bank Balances 247.72 350.67 102.95 -
Provisions 586.14 354.42 - 231.72
Net current assets (CA-CL) 7460.59 8765.23 1304.64 -
Increase or decrease in 1304.48 - - 1304.48
working capital
50
INTERPRETATION:
Rs.16137.54 in 2016-17 to Rs.18321.76 in 2017-18.
But the bank balance increased from Rs.247.72 to Rs.350.67 i.e., 102.95. The
total current liabilities increased from Rs.8676.59 to Rs.9556.53. The net working
capital increases Rs.1304.48.
5. THE STATEMENT SHOWING THE WORKING CAPITAL

FROM 2013-2014 TO 2017-18
TABLE: 4.5
YEAR INCREASE DECREASE
2014-15 - - 2519.95
2015-16 4400.02 -
2016-17 1783.28 -
2017-18 1304.48 -
GRAPH: 4.5
51
CHANGES IN WORKING CAPITAL
5000 4400.02
4000
3000
1783.28
2000 1304.48
NWC
INCREASE
1000
DECREASE
0
2014-15 2015-16 2016-17 2017-18
-1000
-2000
-3000 -2519.95
YEARS
INTERPRETATION:
The above diagram clearly shows that the net working capital of the
Srikalahasthi Pipes Ltd., showing an increase with a decreasing trend. As the net
working capital for the year 2013-14 is -2519.95 it is decrease in the net working
capital but for the years after 2014-15 the net working capital of the firm was
increasing at a decreasing rate i.e., 4400.02, 1783.28, 1304.48 respectively for the
years 2015-16, 2016-17, 2017-18.
1. CURRENT RATIO
The current ratio is a measure of the firm’s short-term solvency. It indicates
the availability of current assets in rupees for every one rupee of current liability. A
ratio of greater than one means that the firm has more current assets than current
claims against them.
Current Ratio = Current Assets
Current Liabilities
TABLE: 4.6
YEARS CURRENT CURRENT RATIO
ASSETS LIABILITIES
2013-14 161.36 96.25 1.68
2014-15 183.22 95.57 1.92
2015-16 261.97 107.26 2.44
2016-17 266.16 100.3 2.65
52
2017-18 359.74 108.83 3.31
GRAPH: 4.1
CURRENT RATIO
3.5 3.31
3
2.65
2.44
2.5
RATIO
1.92
2 1.68
1.5
0.5
0
2013-14 2014-15 2015-16 2016-17 2017-18
YEARS
INTERPRETATION:
The firm’s current ratio is almost 2:1 in years 2013-14, 2014-15. This refers
that the company’s current assets are almost equal to current liabilities it is not a very
good position of short-term solvency. But in 2014-15 to 2017-18 the ratio is too low
then the standard ratio 2:1.
2. QUICK RATIO
Quick Ratio, also called acid-test ratio, establishes a relationship between
quick, or liquid, assets and current liabilities. An asset is liquid if it can be converted
into cash immediately or reasonable soon without a loss of value. Cash is the most
liquid asset and other assets that are considered to be relatively liquid. Inventories are
considered to be less liquid. The quick ratio is found out by dividing quick assets by
current liabilities.
Quick Ratio = Current Assets – Inventories
Current Liabilities
TABLE: 4.7
YEARS QUICK ASSETS CURRENT LIABILITIES RATIO
2013-14 90.61 96.25 0.94
2014-15 91.28 95.57 0.96
2015-16 155.6 107.26 1.45
2016-17 145.23 100.3 1.45
2017-18 215.38 108.83 1.98
53
GRAPH: 4.2
QUICK RATIO
2.5
1.98
2
RATIO
1.45 1.45
1.5
0.94 0.96
1
0.5
0
2013-14 2014-15 2015-16 2016-17 2017-18
YEARS
INTERPRETATION:
The higher the Quick Ratio indicates the ability of a firm is liquid and has the
ability to meet its current liabilities in time. The company’s Quick Ratio is almost
equal to standard ratio 1:1 in the years, 2015-16, 2016-17 and 2017-18. But in
2014-15 and 2013-14 it is not equal to ideal ratio.
3. CASH RATIO
Cash Ratio establishes relation between cash and current assets. It indicates
the proportion of cash in current assets. It is calculated by dividing cash by current
assets.
Cash Ratio = Cash
Current Assets
TABLE: 4.8
YEARS CASH CURRENT LIABILITIES RATIO
2013-14 2.47 161.36 0.02
2014-15 3.51 183.22 0.02
2015-16 26.5 261.97 0.1
2016-17 4.2 266.16 0.02
2017-18 34.64 359.74 0.1
GRAPH: 4.3
54
CASH RATIO
0.12
0.1 0.1
0.1
0.08
RATIO
0.06
0.04
0.02 0.02 0.02
0.02
0
2013-14 2014-15 2015-16 2016-17 2017-18
YEARS
INTERPRETATION:
High Cash Ratio indicates the idle cash reserves in the company, but low cash
ratio is also not favorable to the company. By studying the above data the company
has in-sufficient cash reserves with it. In 2017-2018 the company’s cash ratio is
0.116 only.
4. NET WORKING CAPITAL TURNOVER RATIO

A firm may also like to relate net current assets (or net working capital gap) to
sales. It may thus compute net working capital turnover by dividing sales by net
working capital is
Net Working Capital Turnover Ratio = Sales

Net Working Capital
TABLE: 4.9
YEARS SALES NET WORKING CAPITAL RATIO
2013-14 286.62 74.61 3.84
2014-15 302.96 87.65 3.46
2015-16 369.4 154.71 2.39
2016-17 463.66 165.86 2.80
2017-18 644.72 250.91 2.57
GRAPH: 4.4
55
NET WORKING CAPITAL TURNOVER RATIO
4.5
4 3.84
3.46
3.5
3 2.8
RATIO
2.57
2.39
2.5
2
1.5
1
0.5
0
2013-14 2014-15 2015-17 2017-18 2018-19
YEARS
INTERPRETATION:
The average working capital ratio is 3.324. Thus it is indicated that for one
Rupee of sales, the company needs 0.33324 of net current assets. The remaining is
met from the long term funds and bank borrowings. In the study period the working
capital turnover ratio was continuously fluctuated.
5. GROSS PROFIT MARGIN RATIO

The ratio establishes a relationship between gross profits in to sales. The first
profitability ratio in relation to sales is the Gross Profit Margin (or simply gross
margin ratio). It is calculated by dividing the gross profit by sales.
Gross Profit Margin = Gross Profit * 100

Net Sales
TABLE: 4.10
YEARS GROSS PROFIT SALES RATIO
2013-14 87.18 286.62 30.42%
2014-15 52.75 302.96 17.41%
2015-16 84.69 369.4 22.93%
2016-17 141.41 463.66 30.50%
2017-18 150.32 644.72 23.31%
GRAPH: 4.5
56
GROSS PROFIT MARGIN RATIO
35
30.42 30.5
30
25 22.93 23.31
RATIO
20 17.41
15
10
0
2013-15 2015-16 2016-17 2017-18 2017-18
YEARS
INTERPRETATION:
The higher gross profit ratio is indicated better performance and lower gross
profit ratio is shown unfavorable. By seeing the graph it is clear that the company’s
performance is high in the year 2013-14. But in the year 2015-16 the gross profit
ratio is down to 17.41 and again it was increased year by year.
6. CURRENT ASSETS TURNOVER RATIO

The firm may wish to know its efficiency of utilizing fixed assets and current
assets separately.
Current Assets Turnover Ratio = Sales

Current Assets
TABLE: 4.11
YEARS SALES CURRENT ASSETS RATIO
2013-14 286.62 161.36 1.78
2014-15 302.96 183.22 1.65
2015-16 369.4 261.97 1.41
2016-17 463.66 266.16 1.74
2017-18 644.72 359.74 1.79
GRAPH: 4.6
57
CURRENT ASSETS TURNOVER RATIO
2
1.78 1.74 1.79
1.8 1.65
1.6
1.41
1.4
RATIO
1.2
1
0.8
0.6
0.4
0.2
0
2013-14 2014-15 2015-16 2016-17 2017-18
YEARS
INTERPRETATION:
This ratio indicates effective utilization of current assets. For one Rupee of
sales the company needs average Rs. 0.50 investment in current assets.
7. CURRENT ASSETS TO FIXED ASSETS

Current assets to fixed assets ratio is disclose the relationship between Current
Assets and fixed assets. The following is the formula to calculate this ratio.
Current Assets to Fixed Assets = Current Assets

Fixed Assets
TABLE: 4.12
YEARS CURRENT ASSETS FIXED ASSETS RATIO
2013-14 161.36 146.04 1.1
2014-15 183.22 185.26 0.99
2015-16 261.97 241.58 1.08
2016-17 266.16 263.88 1.01
2017-18 359.74 282.4 1.27
GRAPH: 4.7
58
CURRENT ASSETS TO FIXED ASSETS
1.4 1.27
1.2 1.1 1.08
0.99 1.01
1
RATIO
0.8
0.6
0.4
0.2
0
2013-14 2014-15 2015-16 2016-17 2017-18
YEARS
INTERPRETATION:
In 2013-14 the ratio is recorded as 1.1, current assets are 110% in the fixed
assets. In the entire study period this ratio is approximately constant. In 2017-18 it is
1.27.
8. INVENTORY TURNOVER RATIO
Stock Turnover Ratio / Inventory Turn over Ratio indicates the number of
time the stock has been turned over during the period and evaluates the efficiency
with which a firm is able to manage its inventory.
Inventory Turnover Ratio = Cost of Goods Sold

Average Inventory
TABLE: 4.13
YEARS COST OF GOODS AVERAGE RATIO
SOLD STOCK
2013-14 199.67 70.75 2.82
2014-15 247.45 91.94 2.69
2015-16 278.62 106.37 2.62
2016-17 354.05 120.93 2.93
2017-18 504.4 144.36 3.49
GRAPH: 4.8
59
INVENTORY TURNOVER RATIO
4
3.49
3.5
2.82 2.93
3 2.69 2.62
RATIO
2.5
1.5
0.5
0
2013-14 2013-14 2014-15 2015-16 2016-17
YEARS
INTERPRETATION:
Usually a high inventory turnover / stock velocity indicate efficient
management of inventory because more frequently the stocks are sold; the lesser
amount of money is required to finance the inventory. A low inventory turnover ratio
indicates an inefficient management of inventory. The ratio is increasing every year,
in 2013-14 it is 2.82 and in 2017-18 it is recorded as 3.49.
9. CURRENT LIABILITIES TO TOTAL LIABILITIES

This ratio discloses the relationship between the current liabilities and total
liabilities. The following is the formula for the ratio.
Current Liabilities to Total Liabilities = Current Liabilities

Total Liabilities
TABLE: 4.14
YEARS CURRENT LIABILITIES TOTAL LIABILITIES RATIO
2013-14 96.25 280.9 34.26
2014-15 95.56 329.01 29.04
2015-16 107.26 403.87 26.56
2016-17 100.3 438.36 22.88
2017-18 108.83 537.56 20.25
GRAPH: 4.9
60
CURRENT LIABILITIES TO TOTAL LIABILITIES
40
34.26
35
29.04
30 26.56
RATIO
25 22.88
20.25
20
15
10
0
2013-14 2014-15 2015-16 2015-16 2016-17
YEARS
INTERPRETATION:
In 2013-14 the ratio is recorded as 34.26%, current liabilities are 34.56% in
the total assets. This ratio is continuously decreasing in the study period.
In 2017-18 it is 20.25%.
10. DEBTORS TURNOVER RATIO

Debtors Turnover Ratio or accounts receivable turnover ratio indicates the
velocity of debt collection of a firm. In simple words it indicates the number of times
average debtors receivable are turned over during a year.
Debtors Turn Over Ratio = Net Credit Sales

Average Debtors
TABLE: 4.15
YEARS NET CREDIT SALES AVERAGE DEBTORS RATIO
2013-14 286.62 71.98 3.98
2014-15 302.96 67.07 4.52
2015-16 369.37 76.68 4.82
2016-17 463.66 88.14 5.26
2017-18 644.72 119.66 5.39
GRAPH: 4.10
61
DEBTORS TURNOVER RATIO
6
5.26 5.39
4.82
5 4.52
3.98
4
RATIO
0
2013-14 2014-15 2015-16 2016-17 2017-18
YEARS
INTERPRETATION:
The higher the value of debtors’ turnover the more efficient is the management
of debtors or more liquid the debtors are. Similarly, Debtors turn over ratio shows a
higher value, in 2013-14 it is 3.98 and it continuously increase, in 2017-15 it recorded
as 5.39.
FINDINGS
 The statement of working capital of the company shows decreases 2519.95

during the period 2013-14 than 2014-15.
 The statement of net working capital of the company shows increases 1783.28
 The statement of working capital of the company shows increases 1304.48
 The company’s quick ratio is almost equal to standard ratio 1:1 in the years,
2015-16, 2016-17 and 2017-18.
 In the study period the working capital turn over ratio was continuously
fluctuated. The average working capital ratio is 3.324.
 The current ratio has been fluctuating over the year, in the year 2013-14 it is
stood at 2.06 which is equal to the ideal ratio of 2:1.
 The quick ratio has been facing ups and downs through the years in the year
2013-14. It is at 1.29 which is equal to the ideal ratio of 1:1.
62
SUGGESTIONS
Working capital of the company has increasing every year. profit also
increasing every year this is good sign for the company. It has to maintain it
further, to run the business long run.
The current and quick ratios are almost up to the standard requirement.so the
working capital management
Company maintains Current Assets equal to Fixed Assets, it is better to invest
the ideal funds in other sources to get other income.
As it is found that Debt-Equity ratio is fluctuating the company is suggested to
maintain a low debt by procuring the funds through equity shares in order to
main a better debt-equity ratio.
The company is suggested to improve the net profit by increasing the volume
of sales ass it found that sales percentage is fluctuating over the year.
Generally, the higher the value of debtor’s turnover the more efficient is the
management of credit.
63
CONCLUSION
From the study it is noticed that the Working Capital is fluctuating i.e.,
increasing from year to year with slight variations. Company position is currently
good and utilization of all funds must be efficient to acquire good position in the
industry.
From the overall analysis of the company I can conclude that financial
position and profitability of the firm are good because.
It has the good future after expansion of the industry.
The firm has sufficient liquidity to meet its short-term obligation effectively.
64
ANNEXURES
SRIKALAHASTHI PIPES LIMITED BALANCE SHEET AS ON (2013-2018)

2013-14 2014-15 2015-16 2016-17 2017-18
Particulars
(In Lacs) (In Lacs) (In Lacs) (In Lacs) (In Lacs
I. SOURCE OF
FUNDS
1. Share holders fund
a) Share capital 3,976.36 3976.36 3976.36 3976.36 3976.36
b)Reserves and Surplus 3,993.06 5108.64 7179.70 8549.77 13713.91
2. Loan Fund
16382.9 26486.50
a) Secured Loans 9,244.81 17832.33 22645.54
2
6130.29
13733.6
b)Unsecured Loans 15,069.11 12271.32 15460.46
5
1
3. Deferred Tax 3435.74
618.06 1184.79 2576.95 3123.73
Liability (net)
40386.3 53,742.80
Total 32,901.40 43836.66 53755.86
6
U. APPLICATION
65
OF FUNDS
1. Fixed Assets
31824.3 40286.29
a)Gross-Block 25,035.99 35516.23 38974.86
2
b) (-) Depreciation, 6,51,0.29 7666.24 9127.88 10734.88 12527.20
24158.0 27759.09
c) Net Block 18,525.70 26388.35 28239.98
8
d) Capital Work in 3441.21
5596.64 754.45 862.01 425.37
Progress
2. Investments - - - -
3. Current Assets,
Loans and Advances
a) Inventories 2752.55 1193.25 5294.05 7075.18 9194.08
b) Sundry Debtors 2619.99 2011.67 4098.66 7197.89 6706.59
c) Cash & Bank 350.67
1669.88 629.03 447.49 247.72
balances
d)Loans and Advances 332.21 338.81 1462.76 1616.75 2070.42
Total 7374.63 4172.77 11302.96 16137.54 18321.76
Less: Current Liabilities 9556.53
3536.64 2828.57 5625.29 8676.59
and provisions
8765.23
Total 3837.99 1344.2 7460.95
5677.67
SRIKALAHASTHI PIPES LIMITED PROFIT & LOSS ACCOUNT AS ON

(2013-2018)
PARTICULARS 2013-14 2014-15 2015-16 2016-17 2017-18
INCOME
33,589.6 41,045.0 49,472.0 68,046.9 71051.8
Sales
7 8 2 5 5
Less: Excise Duty
3,294.07 4,L08.43 3,106.39 3,575.34 1993.89
30,295.6 36,936.6 46,365.6 69057.9
Sales (Net) 64471.61
0 5 3 6
Other income 77.70 33.59 93.21 210.18 71.93
66
Increase/Decrease in 503.99
741.46 471.24 14.16 (246.82)
stock
31,114.7 37,441.4 46,473.0 64,434.9 69633.8
TOTAL
6 8 0 7 8
EXPENDITURE
Raw materials 18,264.9 19,232.4 24,779.9 39,775.5 37578.1
Consumed 4 5 3 1 4
10,091.7
6,79.97 8,629.04 8,874.80
1
Excise Duty paid - - - -
Cost of Materials Sold 276.09 6445 659.16 607.33
Salaries, wages and 18761.1
1,254.33 1,449.85 1,862.53 2.14275
other allowances 1
Other Expenses 1,879.06 2,331.70 2,479.56 2,745.53
Financial Charges 1,257.86 1,l32.36 2,302.59 4,607.48 2061.82
Depreciation 1,093.60 1,156.89 1,51199 1,641.84 1794.60
30,505.8 35,Z76.7 60836.2
TOTAL 42471.56j 61,612.15
5 4 5
Profit/(Loss) before tax 608.91 2,164.74 4001.44 282182 8797.63
Provision for tax 1984.16
193.9 42.93 453.41 318.20
Current
MAT Credit Entitlement ( 242.45) (453.41) 108.14 707.49
Provision for Deferred
Tax 66.73 1392.16 54.6.78 I 312.01
.
Provision for Fringe
7.21 17.54 14.41 -
Benefit Tax
Profit / (Loss) after tax 415.02 1580.80 2591.74 1835.29 5793.97
67
Balance brought
forward from the 748.77 837.09 858.92 l242.48 1143.80
previous year
Prior Period
adjustment (Note 9 - - (55.46) - 67.99
onSchedule20)
Profit available for
1,163.79 2417.89 3395.2 3077.77 7755.76
appropriation
Appropriations
Transfer to Debenture
93.75 187.50 468.75 -
Redemption Reserve
Transfer to General
100.00 1000.00 1,500.00 1000.00 5400.00
reserve
Proposed dividend 198.82 397.64 397.64 397.64 596.45
Tax on Dividend. ,27.88 67.58 67.58 67.58 101.37
Balance carried to
837.09 858.92 1242.48 1143.80 1657.94
Balance Sheet
2698.38 2417.89 3395.20 3077.77 7755.76
Basic & Diluted
1.04 3.98 6.52 4.62 14.57
Earning per share
N. of share used in
computing Basic & 39,763,59 39,763,59 39,763.59 39,763,59
39,763,595
Diluted 5 5 5 5
EPS.
68
BIBLIOGRAPHY
 S.P.Jain, K.L. Narang, ADVANCED ACCOUNTANCY, 10 TH Edition,

2003, Kalyani Publisher, Ludhiana.
 I.M. pandey, FINANCIAL MANAGEMENT, 8TH Edition, 2002, vikas Publishing
House Private limited, NEW DELHI.
 Prasanna Chandra, FINANCIAL MANAGEMENT, 5 TH Edition, 2002, TATA-
MCGRAW HILL, NEW DELHI.
JOURNALS:
 The ICFAI Journal of Applied Finance
 Finance INDIA (INDIA INSTITUTE OF FINANCE )
WEBSITE:
www.srikalahasthipipesltd.com
www.wikipedia.com
69

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INTRODUCTION

Srikalahasthi Pipes Ltd in India

Recent Investments in the Srikalahasthi Pipes Ltd

Types of Cement in India:

Ordinary Portland cement:

Ordinary Portland Cement (OPC) is manufactured in the form of different

Ordinary Portland Cement-Grade 43: Having been certified with IS 8112:1989

 As such, Ordinary Portland Cement is used for quite a wide range of

Portland Pozzolana Cement:

Portland Pozzolana Cement is manufactured by blending pozzolanic materials,

PPC is used in heavy load infrastructure and constructions such as marine

Portland Blast Furnace Slag Cement:

In recent years, there has been a significant growth in the production of

The major companies producing Portland Blast Furnace Slag Cement in

Oil Well Cement:

The major companies manufacturing Oil Well Cement in India are:

Rapid Hardening Portland Cement (RHPC) is a type of cement that is used

The Rapid Hardening Portland Cement's better strength performance is

Sulphate Resisting Portland cement:

Sulphate Resisting Portland Cement (SRC) is a type of Portland cement in which

The use of Portland Sulphate Resisting Cement has proved beneficial,

The Sulphate Resisting Portland Cement should be kept in a place which is

The various uses of Sulphate Resisting Portland Cement are:

 Underground and basements structures

The raw materials required for production of Sulphate Resisting Portland

The major companies manufacturing Sulphate Resisting Portland Cement in

Sulphate Resisting Portland Cement has proved beneficial for construction

The major companies producing White Cement in India are:

 Gujarat Ambuja Cement Ltd.

Clinker Cement in India is produced in such large quantities that it is able to

Clinker Cement is usually ground with calcium sulphate so that it becomes

The major companies producing Clinker Cement in India are:

Industries Limited (LIL) was incorporated on 1st November, 1991 by Lanco

During 2005, the company started setting up of a Captive Power Plant of 12

An additional amount of Rs.25 corers is being spent on other capital works

1991 Incorporation of Srikalahasthi Pipes Ltd

1994 Setting up of Mini Blast Furnace with 90,000 TPA capacity

1995 Setting up a 250 TPD Mini Cement Plant

1997 Setting up of LKCL for manufacture of 40,000 TPA castings and

2002 Strategic Alliance with Electro steel Casting Limited

2007 Stamp Charging System was successfully implemented at Coke Oven

Pig Iron Project was conceived in 1992. Commercial production started in

Expansion/New Projects after Take-over: Investment Rs. 175 Crs.

ABOUT SRIKALAHASTHI PIPES LTD

FOUNDER & CHAIRMAN

COMMITTEE OF SRIKALAHASTHI PIPES EXECUTIVES AND

The varied services are backed by decades of experience of the Group’s

MANUFACTURING PROCESS – CEMENT

Srikalahasthi pipes ltd Cement is the result of a

Progressively increasing later stage strength.

Crushing and grinding:

MISSION & VISION

1. Suitable horizontal and vertical integration projects.

3. Engineering & consultancy

4. Build-own-operate-transfer projects and diversify into new areas of

We will achieve the above through:

CONCEPTS OF WORKING CAPITAL:

GROSS WORKING CAPITAL:

NET WORKING CAPITAL:

Net Working Capital can be Positive (or) Negative:

Short-term or Temporary or Variable Working Capital is the amount of

Balance Sheet Working Capital: Time