KERALA MINERALS & METALS LIMITED, CHAVARA

4.1 METHODS OF DATA COLLECTION

Data can be collected in a variety of ways. Interviewing, observation and recording are some
of the most prevalent data collection method. The data related to the study was gathered by
observing and gathering the essential information from secondary source such as the
company annual reports. The researcher collects the company’s reports throughout a five-
year period and meticulously observes, checks, and records the relevant data and information.

The Data Analysis Tools and Techniques Used In the Project Are:

An inventory management is technique which is generally used to manage the company

effectively. The company wants to control their inventory cost, material cost, labor cost etc.
There are several inventory techniques used in company such as FSN, ABC. In this study we
shall focus on ABC analysis and FSN analysis. In ABC analysis the items are classified into
A, B and C classes based on their consumption value and FSN analysis the items are
classified in to F, S and N (Fast moving, Slow moving, Non-moving) classes based on their
quantity consumed. Data collection is mainly through the general stores of Titanium Dioxide
Pigment plant.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.1 Inventory Turnover Ratio

Table No: 4.1.1 The table showing Inventory turnover ratio of the organization.

YEAR NET SALES AVERAGE INVENTORY INVENTORY

(In Lakh) TURNOVER RATIO (%)

2017-18 65391.71 23798.715 2.74

2018-19 72266.52 19944.59 3.62

2019-20 82970.98 22436.675 3.69

2020-21 71252.09 23748.73 3.00

2021-22 78357.57 23755.45 3.29

Inventory Turnover Ratio

4

3.5

2.5

1.5

0.5

0
2017-18 2018-19 2019-20 2020-21 2021-22

Inventory Turnover Ratio

Chart No: 4.1.1 The picture depicting the Inventory Turnover Ratio in the Organization.

Interpretation:-

In the years 2017-18 and 2020-21, there is low turnover; however in the years 2019-20 and
2021-22, there is a large turnover, implying robust sales.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.2 Raw Material Turnover Ratio

Table No: 4.1.2 The table showing raw material turnover ratio in the organization.

YEAR RAW MATERIAL AVERAGE RAW MATERIAL

CONSUMED( In Lakh) MATERIAL TURNOVER RATIO
2017-18 10373.12 4104.4 2.52
2018-19 11270.35 2420.095 4.65
2019-20 16645.48 2253.765 7.38
2020-21 20658.53 2303.3 8.96
2021-22 180585.41 2232.975 8.08

Material Turnover Ratio

10
9
8
7
6
5
4
3
2
1
0
2017-18 2018-19 2019-20 2020-21 2021-22

Materal Turnover Ratio

Chart No: 4.1.2 The picture depicting Raw Material Turnover Ratio in the organization.

Interpretation:-

This graph indicates that the raw material turnover has been increasing every year since 2017.
Which is regarded an excellent balance between sales and replenishment. In comparison to
the previous year, there is a high material turnover in 2020-21.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.3 Work in Progress Turnover Ratio

Table No: 4.1.3 The table showing work in progress turnover ratio.

YEAR COST OF GOODS AVERAGE WIP TURNOVER

PRODUCED (In Lakh) WIP RATIO
2017-18 64262.48 743.96 86.37

2018-19 77595.64 700.07 110.83

2019-20 83125.15 841.343 98.80

2020-21 72817.69 1138.91 63.93

2021-22 80723.31 1546.53 52.19

WIP TURNOVER RATIO

120

100

80

60
WIP TURNOVER RATIO

40

20

0
2017-18 2018-19 2019-20 2020-21 2021-22

Chart No: 4.1.3 The picture depicting the Work in Progress Turnover ratio in the
organization.

Interpretation:-

Works in progress indicates the stock withdrawn from warehouse and are yet to get converted
in to finished stock. The higher the ratio the higher will be the management efficiency. In
2018-19 there is a huge increase in work in progress turnover ratio, and the ratio is 110.83. If
the ratio is high it can be easily converted into finished goods and also it shows the high
management efficiency.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.4 Finished goods turnover ratio

Table No: 4.1.4 The table showing finished goods turnover ratio in the organization

YEAR COST OF GOODS AVERAGE FINISHED FINISHED GOODS

SOLD (In Lakh) GOODS INVENTORY TURNOVER RATIO

2017-18 62509.59 12613.912 4.95

2018-19 54155.67 10205.62 5.30

2019-20 66506.64 11755.9 5.65

2020-21 66892.35 6577.135 10.17

2021-22 66807.89 11356.365 5.88

FINISHED GOODS TURNOVER RATIO

12

10

6 FINISHED GOODS TURNOVER

RATIO
4

0
2017-18 2018-19 2019-20 2020-21 2021-22

Chart No: 4.1.4 The picture depicting the finished goods turnover ratio in the organization.

Interpretation:-

The finished goods turnover ratio can be readily be translated into sales if it is high. The
turnover was strong in 2020-21, but the inventory levels were excessively low as compared to
the rest of the year.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.5 Trend of net sales during the period (2017-2022)

Table No: 4.1.5 The table showing trend of net sales during the period (2017-2022)

YEAR NET SALES TREND %

2017-18 65391.71 100

2018-19 72266.52 110.51

2019-20 82970.98 114.81

2020-21 71252.09 85.87

2021-22 78357.57 109.97

Trend%
140

120

100

80

Trend%
60

40

20

0
2017-18 2018-19 2019-20 2020-21 2021-22

Chart No: 4.1.5 The picture depicting trend of net sales during the period (2017-2022)

Interpretation:-

After a long decline, the company’s net sales are expected to rise in 2021-22. This is a
positive sign that a company is selling things swiftly and that there is a significant demand for
the products.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.6 Trend of average inventory during the period (2017-2022)

Table No:-4.1.6 The table showing trend of average inventory during the period (2017-
2022).

YEAR AVERAGE INVENTORY TREND %

2017-18 23798.71 100

2018-19 19944.59 83.80

2019-20 22436.675 112.49

2020-21 23748.73 105.84

2021-22 23755.45 100.02

Trend%
120

100

80

60
Trend%

40

20

0
2017-18 2018-19 2019-20 2020-21 2021-22

Chart No: 4.1.6 The picture depicting trend of average inventory during the period (2017-
22).

Interpretation:-

The company’s average inventory is declining in 2021-22, while the average inventory is at a
peak in 2019-20 as compared to the previous year.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.7 CURRENT RATIO

Table No: 4.1.7 The table showing current ratio in the organization.

YEAR CURRENT ASSET CURRENT CURRENT RATIO

LIABILITY
2017-18 37421.75 12324.25 3.03
2018-19 51705.91 15007.42 3.44
2019-20 59161.85 13466.85 4.39
2020-21 58134.75 31466.85 1.84
2021-22 64264.75 16535.97 3.88

CURRENT RATIO

2017-18
2021-22 18%
23%

2020-21 2018-19
11% 21%

2019-20
27%

Chart No: 4.1.7 The picture depicting the current ratio in the organization.

Interpretation:-

When compared to previous years, the current ratio is showing an upward tendency. The
maximum current ratio in 2019-20 is 4.39, resulting from a 27% rise. And the minimum rise
in the present ratio of 1.87 for 2020-21 is only 11%.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.8 Quick Ratio

Table No: 4.1.8 The table showing quick ratio in the organization.

YEAR QUICK ASSET CURRENT LIABILITY QUICK RATIO

2017-18 18967.19 12324.25 1.53

2018-19 30378.19 15007.42 2.02
2019-20 35751.49 13466.85 2.65
2020-21 33924.94 31466.85 1.07
2021-22 40963.64 16535.97 2.47

QUICK RATIO

16%
25%
2017-18
2018-19
2019-20
21%
2020-21
11%
2021-22

27%

Chart No: 4.1.8 The picture depicting quick ratio of the organization.

Interpretation:-

It shows a 27% improvement in quick ratio of 2.65 in the year 2019-20 in comparison to
previous years. In 2021-22, the quick ratio will be 2.47, which is a 25% rise. KMML has the
resources to meet its present obligations.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.9 Finished goods conversion period

Table No: 4.1.9 The table showing Finished goods conversion period in the organization.

YEAR NUMBER OF FINISHED GOODS FINISHED GOODS

DAYS TURNOVER RATIO CONVERSION PERIOD
2017-18 365 4 91.25

2018-19 365 5 73

2019-20 365 5 73

2020-21 365 10 36.5

2021-22 365 5 73

FINISHED GOODS CONVERSION PERIOD

100
90
80
70
60
50 FINISHED GOODS CONVERSION
PERIOD
40
30
20
10
0
2017-18 2018-19 2019-20 2020-21 2021-22
.

Chart No: 4.1.9 The picture depicting finished goods conversion period in the organization

Interpretation:-

This graph shows that, holding duration of finished items was 91.25 days in 2017-18,
according to the data. It is 36.5 days in the year 2020-21, which is better than previous years.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.10 Inventory conversion period

Table No: 4.1.10 The table showing inventory conversion period in the organization.

YEAR NO:OF DAYS INVENTORY TURNOVER INVENTORY

RATIO CONVERSION PERIOD
2017-18 365 2.74 133.21

2018-19 365 3.62 100.82

2019-20 365 3.62 98.91

2020-21 365 3 121.66

2021-22 365 3.29 110.94

INVENTORY CONVERSION PERIOD

140

120

100

80
INVENTORY CONVERSION
60 PERIOD

40

20

0
2017-18 2018-19 2019-20 2020-21 2021-22

Chart No: 4.1.10 The picture depicting inventory conversion period in the organization.

Interpretation:-

The graph depicts that the company’s conversion period from 2018-19 to 2019-20 is
favorable.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.11 Raw material conversion period

Table No: 4.1.11 The table showing raw material conversion period in the organization.

YEAR NO:OF MATERIAL RAW MATERIAL

DAYS TURNOVER RATIO CONVERSION PERIOD
2017-18 365 2.52 144.84
2018-19 365 4.65 78.49
2019-20 365 7.38 49.45
2020-21 365 8.96 40.73
2021-22 365 8.08 45.17

RAW MATERIAL CONVERSION PERIOD

160

140

120

100

80 RAW MATERIAL CONVERSION

PERIOD
60

40

20

0
2017-18 2018-19 2019-20 2020-21 2021-22

Chart No: 4.1.11 The picture depicting raw material conversion period in the organization.

Interpretation:-

The year 2020-21 has a shorter conversion duration, 40.73 days, as shown in this graph. As a
result, the corporation will be able to make more money. When comparing the previous year
to the current one.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.12 Work in progress conversion period

Table No: 4.1.12 The table showing Work in progress conversion period in the organization.

YEAR NO:OF DAYS WIP TURNOVER WIP CONVERSION

RATIO PERIOD
2017-18 365 89.37 4.22
2018-19 365 110.83 3.29
2019-20 365 98.8 3.69
2020-21 365 63.93 5.70
2021-22 365 52.19 6.99

WIP CONVERSION PERIOD

8

4
WIP CONVERSION PERIOD
3

0
2017-18 2018-19 2019-20 2020-21 2021-22

Chart No: 4.1.12 The picture depicting Work in Progress conversion period in the
organization.

Interpretation:-

This graph illustrates that the company will have a high conversation period in 2021-22,
which is not favorable for the company. However, it has a low WIP conversion phase in
2018-19, which is positive for the company.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.1.13 Fixed assets turnover ratio

Table No: 4.1.13 The table showing Fixed assets turnover ratio in the organization.

YEAR NET SALES AVERAGE NET FIXED FIXED ASSETS

ASSETS TURNOVER RATIO
2017-18 65391.71 35651.93 1.83
2018-19 72266.52 30289.09 2.38
2019-20 82970.98 27680.1 2.99
2020-21 71252.09 26228.55 2.71
2021-22 78357.57 25498.55 3.07

FIXED ASSETS TURNOVER RATIO

3.5

2.5

2
FIXED ASSETS
1.5
TURNOVER RATIO

0.5

0
2017-18 2018-19 2019-20 2020-21 2021-22

Chart No: 4.1.13 The picture depicting Fixed assets turnover ratio in the organization.

Interpretation:-

In this graph, it can be seen that the fixed asset turnover ratio in the year 2021-22 is higher
than in previous years. A turnover ratio of 2.5 or more is considered favorable for a business.
In this year 2021-22 the fixed asset turnover ratio is 3.07 which is good for the company.

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KERALA MINERALS & METALS LIMITED, CHAVARA

4.2. ABC ANALYSIS

4.2.1 ABC analysis of major raw material consumed for the year 2021-22
Table No: 4.2.1 (a) The table showing list of raw material for the year 2021-22

ITEM ITEM NAME CONSUMED VALUE/ VALUE IN CLASSIFI

CODE UNITS UNITS LAKHS CATION
000000002 RAW ILMENITE 75322.4 22848.63 1721 A
000000003 FURNACE OIL 28581.32 19414.27 555 A
000000004 CALCINED 15194 30442.294 463 A
PETROLEUM COKE
000000005 LIQUIFIED PETROLIUM 4455.88 73567.885 328 A
GAS (LPG)
000000006 HYDRATED LIME 14665.345 10320.63 151 A
000000007 HYDROCHLORIC ACID 34979.72 3654.51 128 B
000000008 LIQUID CHLORINE 14395 7901.49 114 B
000000009 PETROLEUM COKE-NPF 4590.29 15710.93 72 B
GRADE
000000010 CAUSTIC SODA LYE 4522.65 14529.05 66 B
000000011 SODIUM SILICATE 3526.94 12981.175 46 B
000000012 CARBOBEAD LT 16/20 340.5 116593.81 40 B
000000013 ALUMINIUM 584 56878.96 33 B
CHLORIDE
000000014 ALUMINIUM 1074.626 30209.05 32 B
TRIHYDRATE
000000015 TRIMETHYL ETHANE 182.75 105359.74 19 B
[TRIMET]
000000016 SULPHURIC ACID 1599.74 9210.37 15 B
000000017 TREATING OIL 99.4 89987.93 9 C
000000018 LIQUIFIED NATURAL 11539.05 750.56 9 C
GAS [LNG) IN MMBTU
000000019 SODIUM HEXAMETA 81.225 89890.12 7 C
PHOSPHATE
000000020 MILLED 24 190700 5 C
AGGLOMERATE
000000021 POTASSIUM CHLORID 49.025 49000 2 C
000000022 ZIRCONIUM ORTHO 20.1 114941.67 2 C
SULPHATE
000000023 TRI ISO PROPONOL 2.46 227572.42 1 C
AMINE
000000024 ZIRCON IV 4 115031 0 C

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KERALA MINERALS & METALS LIMITED, CHAVARA

000000025 LIQUID NITROGEN 99.9 24.02 15770.03 0 C

% PURITY
000000026 CABOSIL/ FUMED 0.43 319816.52 0 C
SILICA
000000027 SUCCINIC ACID 0.65 194408.11 0 C
000000028 TRISODIUM 2.725 24822.58 0 C
PHOSPHATE
000000029 SILICA SAND 3 6567.41 0 C
000000030 GYPSUM POWDER 6450 1.17 0 C
(FACT GYPSUM
POWDER)

Table No: 4.2.1 (b)

Summary of ABC analysis of major raw material consumed for the year
2021-22
CLASS NO.OF NO.OF CONSUMPTION CONSUMPTION
ITEMS ITEMS (%) VALUE VALUE (%)

A 5 17.24 3218 84
B 10 34.48 565 15
C 14 48.27 35 1

Total 29 100 3817 100

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ABC analysis of major raw material consumed for the year 2021-22

Consumption Value
90 84
80
70
60
50
40
30
20 15
10
1
0
A 17.24 B 34.48 C 48.27

Consumption Value

Chart No: 4.2.1 (a) The picture depicting ABC analysis of major raw material consumed for
the year 2021-22

Number of items or materials in A, B, C category

A,B,C CATEGORY MATERIALS

16

14
14
12

10
10
8

6 NO.OF MATERIALS

4 5
2

0
A B C
MATERIAL CATEGORY

Chart No: 4.2.1 (b) The picture depicting Number of items or materials in A, B, C category

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KERALA MINERALS & METALS LIMITED, CHAVARA

Percentage of items or materials in A, B, C, Category

PERCENTAGE OF MATERIALS IN A, B, C,
CATEGORY

17%

A
49% B
C
34%

Chart No: 4.2.1 (c) The picture depicting Percentage of items or materials in A, B, C,
Category.

Interpretation: - ABC Analysis

From the table and graph above showing the ABC analysis of major raw materials of KMML
in the year 2021-22 is found that 17.24% of the materials constitute 84% of the consumption
value and are classified as A items. 34.48% of the materials constitute 15% of the
consumption value and are classified as B items. 48.27% of the materials constitute 1% of the
consumption value and are classified as C items. Data taken for analysis is of the year 2021-
22. The annual consumption value is 3817 lakhs, total number of materials is 29.

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4.3 FSN ANALYSIS

4.3.1 FSN analysis of materials consumption of KMML from 1/01/2022 to

31/06/2022
Table No: 4.3.1 (a) The table showing list of material consumption from 1/01/2022 to
31/06/2022

GROUP MATERIALS DESCRIPTION QTY VALUE CLASSIFICATION

CODE
00 RAW MATERIALS 216716.5 79163649.76 F
01 PACKING MATERIALS FOR FINISHED 197500 6696375.75
F
GOODS
02 MEDISCINES 80360 276298439.2 F
03 BUILDING MATERIALS 78210 28229047.01 F
04 REFRACTORIES AND THRML ISLTN 44003 11064690.76 F
05 OILS AND LUBRICANTS 17600 1445676.32 F
06 LAMBS FITTINGS AND ACCESSORIES 2290 79781.54 F
07 FASTNERS, BOLT, NUT ETC 1860 409604.36 F
08 PRINTING AND STATIONARY 1000 1600 F
09 CABLE AND WIRES 1000 65549.4 F
10 PACKING AND GASKETS 780 3318038.18 F
11 WELDING, SOLDERING AND 550 9276.8
F
BRACNG MTRLS
12 STRAINERS AND STEAM STRAP 500 44200 F
13 PERSONNEL HEALTH AND 350 98185.01
F
WELAFARE
14 TELEPHONE 250 150000 F
15 PIPES AND TUBES 240 248640 F
16 LOCKS, CANS AND EMPTY DRUM 200 257675 F
17 OIL STORAGE PLANT 200 355615.6 F
18 CONDUIT PIPES AND FITTINGS 160 217.57 F
19 PAINTS AND VARNISHES 100 18000 F
20 RESISTORS AND CAPASITORS 100 535000 F
21 WIRES AND FABRICATED WIRES 100 117420 F
22 INSULATORS AND INSULATING 91.9 15160
S
MATERIALS
23 ELECTRICAL MOTORS AND SPARES 70 306897.5 S
24 CHEMICAL LAB APPARATUS 60 80782.5 S
25 SANITARY MATERIALS 50 65875 S
26 TOOLS 50 311250 S
27 CONTROL ROOM A/ C 50 1460000 S
28 BATTERY AND CELLS 40 125000 S
29 NON-FERRUS METALS 40 13826 S
30 NON-FERRUS PIPES AND TUBE 40 216083.83
S
FITTINGS

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31 AUTOMATIVE EQUIPMENT 40 600 S

32 CUTTING MACHINERY 30 1558603.8 S
33 CONTROLLERS, RECORDERS, 30 356403.95 S
34 CAPITAL ITEMS 30 77865 S
35 ITEMS FOR TITANIUM SPONGE 30 80250
S
PROJECT
36 BEARING AND V-BELTS 20 19743.47 S
37 HOSES AND FITTINGS 20 5100 S
38 FERROUS PIPES AND TUBE FITTINGS 20 966.07 S
39 P.P.P AREA EUIPMENTS 20 5800 S
40 EFFLUENT TREATMENT PLANT 20 531323.2 S
41 NEW PROJECT 19.3 762543.64 S
42 WOOD MATERIALS 18 0 S
43 LAB EQUIPMENTS 12 222000 S
44 CABLE JOINTING MATERIALS 10 464.3 S
45 MISC ITEMS CONSUMABLES 10 0 S
46 ROPES, CHAINS, TWAINS AND 10 5850
S
CORDS
47 VALVES AND SPARES 10 19303.13 S
48 SAFETY AND FIRE MATERIALS 10 2650 S
49 A.R.P. AREA EQUIPMENTS 10 5000000 S
50 GEAR BOXES 10 96426 S
51 BOILER AREA EQUIPMENTS 10 5334.55 S
52 WATER TREATMENT PLANT 10 2350400
S
EQUIPMENTS
53 GAS AND COMPRESSED AIR 10 64160.6
S
STATION EQPTS
54 ONE TIME PURCHASES 10 1334.93 S
55 EARTHING CONNECTORS AND 6 9000
N
CLAMPS
56 LAB CHEMICALS 5 1892.5 N
57 ABRASIVE (EMERY CLOTH) 4 839.18 N
58 FERROUS METALS 3.05 148711.57
59 CABLING AND WIRING MATERIALS 3 56700 N
60 CONTACTS, RELAYS, FUSES AND 2 5898.3
N
SWITCHES
61 I.B.P. AREA EQUIPMENTS 2 237470 N
62 MISC. SPARES 2 0 N
63 MATERIAL HANDLING EQUIPMENT 2 0 N

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Table No: 4.3.1 (b)

Summary of FSN analysis of materials consumption of KMML from

1/01/2022 to 31/06/2022
CLASS NO.OF NO.OF CONSUMPTION CONSUMPTION
ITEMS MATERIALS (%) VALUE (%) VALUE IN
LAKHS
F 36 56.25 75 413.8

S 19 30 17 90.89

N 9 14.06 8 46.55

TOTAL 64 100 100 551.24

No of items in F, S, N category

F,S,N CATEGORY MATERIALS

40

35
36

30

25

20
NO.OF MATERIALS
19
15

10
9
5

0
F S N

Chart No: 4.3.1 (a) The picture depicting No of items in F, S, N category

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Percentage of items or materials in F, S, N category

PERCENTAGE OF MATERIAL IN F, S, N CATEGORY

60.00%

56.00%
50.00%

40.00%

30.00%
30% PERCENTAGE OF MATERIAL

20.00%

14%
10.00%

0.00%
F S N

Chart No: 4.3.1 (b) The picture depicting Percentage of items or materials in F, S, N
category.

Interpretation: - FSN Analysis

From the tables and graph above showing the FSN analysis of materials consumption it is
found that 56% of the items constitute 75% of the consumption value and are classified as F
items.30% of the items constitute 17% of consumption value and are classified as S items.
14% of the materials constitute 8% of the consumption value and are classified as N items.
Data taken for the analysis is of 01/01/2022 to 31/06/2022. Total consumption value is
551.24 lakhs,

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