Abhishek (P03MB210083) Project Work

(A STUDY ON WORKING CAPITAL IN METROCASH AND CARRY)
Project Report submitted in Partial fulfillment of the requirement for

theAward of the degree of
MASTER OF BUSINESS ADMINISTRATION
of
BANGALORE UNIVERSITY
By
Mr. ABHISHEIK NAIK B
(Register No- P03MB21M0083)
3rd SEMESTER MBA
Under the guidance of
Prof/Dr. D Prabha and Assistant prof. Mahima Agrawal
(Designation of guide)
National Highway 7, Opposite Biocon limited, Electronic city post, Bangalore- 562100
2022-2023
STUDENT DECLARATION
I hereby declare that the Dissertation report titled (“A STUDY ON WORKING
CAPITAL IN METRO CASH AND CARRY”) submitted in partial fulfillment of the
requirement of degree of Master of Business Management in Bangalore
University, has been prepared by me during the academic year 2022-2023
under the Guidance (D.Prabha and Mahima Agrawal) in Department of
Management Studies.
I further declare that this Project Report is the outcome of my own efforts
and that is not submitted to any other University or Institute for the award of
other degree or diploma or other certificate.
Place: Bangalore Mr. ABHISHEIK NAIK B

Date:02/02/2023 (Register No- P03MB210083)
[Type here ] [Type here ] [Type here ]

CERTIFICATE FROM THE COLLEGE
This is to certify that Mr. ABHISHEIK NAIK B bearing Register no:

P03MB210083 has successfully completed the Project Report titled “(A
STUDY ON WORKING CAPITAL IN METRO CASH AND
CARRY)”
for the partial fulfillment of the requirement of the Bangalore University for
the award of Master of Business Administration. This research work was
carried out by his and it is original in nature.
PRINCIPAL
CERTIFICATE FROM THE GUIDE
This is to certify that the dissertation report titled “A STUDY ON WORKING

CAPITALIN METRO CASH AND CARRY is the Bonafide work carried
out by Mr. ABHISHEIK NAIK B bearing Register no: P03MB210083 in
partial fulfillment of the requirement for the award of MBA degree of
Bangalore University, under my Guidance and Supervision.
The Project Report submitted by his has been successfully completed and
reflects
his hard work and sincere effort.
Place: Project guides

Bangalore Prof. (D. Prabha)
(Mahima Agrawal)
Date:
Department of MBA
COMPANY CERTIFICATE
METRO CASH AND CARRY

Registered Office: No. 18/1, Kanakapura road
Bangalore Karnataka — 560 062
Date: 23/12/2022
TO WHOM IT MAY CONCERN
This is to certify that Mr. ABHISHEIK NAIK B a student of St Francis de Sales

College— Bangalore has successfully completed his project work for 3 Weeks in
the field of Management from 5th December to 23rd December 2022 At METRO
CASH AND CARRY " Kanakapura Main Road, Bangalore.
His Project work activities include familiarization to all the departments, their
operations and process along with a management overview involved in the sales and
service process of the organization.
D
uring the Period of his program with us, He had been exposed to different process
and was found diligent, hardworking and inquisitive. We wish him every success in
his life and career.
ACKNOWLEDGEMENT
I owe a deep sense of gratitude to those who have contributed to the successful
completion of this endeavor and take this opportunity with much pleasure to
thank all the people who have helped us through the course of journey towards
producing this Project report.
At the onset, I express my gratitude to the Almighty God for his
abundant grace, blessings and goodwill throughout this project.
I am grateful to my guide Prof (D Prabha and Mahima Agrawal), City

College for their constant support, encouragement and guidance.
I am grateful to who gave his valuable time for the interaction and allowed
me to carry out this project.
I would also like to thank all who helped me directly or indirectly in completing
this project successfully.
Name of the Student-ABHISHEIK NAIK B

(Register No-P03MB210083)
Table of Contents
Sl. No Reports particulars Page

No
Executive summery 1-2

1. Introduction 2-30
 Introduction about finance
 Capital structure and theories
 Introduction about literature review
2. Company Profile and Overall Organizational Study 31-47
 Industry profile
 SWOT analysis
 Recent trends of the company
3. Research Design /methodology 48-66

 Needs and objectives of the study
 Literature review
 McKinsey 7S
 Data sources (Primary and secondary sources)
4. Framework and Analysis 67-79
5. Summary of Findings, Conclusion and Recommendations 79-84
85-86
BIBLIOGRAPHY
LIST OF FIGURES/ GRAPHS
SL NO PARTICULARS PAGE NO
1 NET WORKING CAPITAL RATIO 68-69
2 WORKING CAPITAL TURNOVER RATIO 69-70
3 STOCK WORKING CAPITAL RATIO 70-71
4 CASH TO CURRENT WORKING RATIO 71-72
5 INCOME TO TOTAL INCOME RATIO 72-76

Executive summary
This survey was carried out in the working capital in the metro cash and carry.The main
purpose of the study was to confirm the implementation of social representatives.
Working capital is important in all companies. The basic element to be considered when an
employee's activity is assigned and the progress of workers in workers' activities. The
assessment is completed as part of the disposition of the test system and enjoy the template.
The information you need is collected as an overview. Electrical information is collected in the
report on articles, organizations, and websites. Employees are prepared for research and
collectionwith respect to related information. The information is cut and close the large
strategy and closes the points. Discuss discussions on consultation on surveys andcounseling
for scholars and proposals. Incorrect experts occur until most workersare satisfied. Likewise,
presentations were found in most factors. Complaints between employees showed that they
deal with the completion and efficiency ofthe organization. Important conclusions and
suggestions are available in the organization for the best system.
The policy, on which Metro was relying to was represented by meeting the customers’ demands,
by offering them high quality products at an advantageous price. The available of products in certain
time represents another important characteristic of Metro Group, giving the clients the possibility
often products they needed. The economic growththat Germany met in this period of time, leaded the
company to rethink their strategy by entering on new external markets, in those countries with high
economic potential like France, Austria and Denmark in year 1971.
This report is about the significance and objectives of a Strategic Marketing and implementations in
market.
This report is mainly concerned with the marketing plan for METRO Cash & Carry, the departmental
chain business. In this report we have discussed that on what grounds the METRO has divided its
market into different segments, how they present the product in the mind of the customers. We have
surveyed the market and identified such segment of market which is not responding in that way which
the company is expected from it. And after this process we select the retailers as customers of
METRO store.
Moreover, this report shows the competitive advantage of METRO and we check it out whether this
advantage is actually working efficiently. Analysis of external (task and macro environment) or PEST
analysis and Porter’s five forces model and focused internal environmental audit is included in this
report.
CHAPTER-1
INTRODUCATION
CONCEPTUAL BACKGROUND OF THE STUDY
1.1 INTRODUCTION ABOUT FINANCE

Every business enterprise whether small, medium or big needs finance to carry out its
operations and accomplish its targets. Finance is the study of how investors allocate their financial
resources over time under conditions of certainty and uncertainty. It is judicious way of managing
funds. Earlier the concept of finance focused on raising funds by the enterprise. Now the domain of
finance has expanded. It focuses not only on raising of funds by the business enterprise but also its
optimum usage. An enterprise needs finance to meet its requirements in the economic world. For
smooth Functioning of a business activity, proper flow of funds is required of time to ensure
maximum profits. So, it is necessary to understand the need of finance, which plays a vital role in
business. In the modern economy all the business operations are taking new shape as per the
changing demands in the business world. It further becomes essential for finance managers,
academicians, practicing managers and all people who are connected to the finance world to
understand the wider aspects of financial management. All the business operations are concerned
with the maximizing profits. A finance manager should be able to integrate with other departments
for improving the efficiency of business process by proper utilization of finance. To do integrate this
he is, to with other functional activities like marketing, production, human resources, research and
development, technology etc., which requires adequate finance to achieve functional goals and in
turn the overall goals of an organization. Finance act as a medium for business which involves the
acquisition and usage of funds in various departments such as production department, purchase
department, research and development etc., Finance is an art and science of managing money.
Finance is the set of activities dealing with the management of funds. More specifically, it is the
decision of collection and use of funds. All type of organizations whether small, medium or larger
scale corporation requires finance for the above said functions without which the smooth functioning
of business cannot be accomplished. In short, finance plays a keyrole in the business.
ST. FRANCIS DE SALES

The basic aim of starting a business is earning profit for which the proprietor has to sacrifice
or invest some amount of money in the business. Money invested helps in acquiring resources i.e.,
assets. The assets of the business are used in process of production, distribution and in the operation
ofthe business. The funds to be invested are procured from various sources. The source can be
promoter himself or outsiders to the business. Those funds are the input to businesswhich will
provide the
expected output. This input is termed as capital/financial capital. The source of financial
capital can be of two types- owned capital and borrowed capital. Owned capital is raised from
owners (promoters/shareholders) also known as owner’s equity and borrowed capital is raised from
lenders or investors known as debt fund or outsider’s equity. The capital can be of various types on
the basis of time such as long-term capital, medium term capital & short-term capital. Long term
capital is basically obtained by issuing share capital, debenture capital, venture capital mortgage,
retained earnings etc. The term loan, leasing, Bank overdraft, trade credit, factoring etc. are the
sources of medium- and short-term capital. All these mixes of sources of funds are known as
financial structure. The portion of finance structure consisting of long-term capital can be said as
capital structure. The capital structure is the combination of equity capital and debt capital. The
proportion of debt and equity in capital structure varies from firm to firm and time to time. A firm
can adopt a capital mix of either 100% equity and zero debt or 100% debt with zero equity or any
combination of both. Equity financing is less risky in the sense of cash flow commitments, but results
in a dilution of ownership and earnings whereas debt capital creates an obligation or liability with
low-cost and high risk. It is a very important component of corporate finance. Long before 50 years
financial management has not got that much importance and deals with only procurement of funds
but at present it has taken the basics of any business including procurement, utilization and control of
finance. So, it directly affects the performance of business organization. That’s why finance manager
should take a decision of optimal capital mix which will increase the financial Performance.

1.1.1 MEANING OF FINANCE
Finance describes the management, creation and study of money, banking, credit, investments,
assets and liabilities that make up financial systems, as well as the study of those financial
instruments. In other words, finance is a field that deals with the study of investments. It includes the
dynamics of assets and liabilities over time under conditions of different degrees of uncertainty and
risk.
1.1.2 DEFINITION OF FINANCE
According to Simon Andrade, “Finance is the area of economic activity in which money is the
basis of various embodiments, whether stock market investments, real estate, industrial, construction,
agriculture development and so on”.
According to Ivan Thompson, “The finance comes from the Latin word “finis” which means
end or finish. It is a term whose implications affects individuals and business, organization and states
what it has to do with obtaining and using money or money management.
1.1.3 MEANING OF FINANCIAL MANAGEMENT
Financial Management means planning, organizing, directing and controlling the financial
activities such as procurement and utilization of funds of the enterprise. It means applying general
management principles to financial resources of the enterprise.
1.1.4 OBJECTIVES OF FINANCIAL MANAGEMENT
Profit maximization
Main aim of any kind of economic activity is earning profit. A business concern is also
functioning mainly for the purpose of earning profit. Profit is the measuring techniques to understand
the business efficiency of the concern. The finance manager tries to earn maximum profits for the
company in the short-term and the long-term. He cannot guarantee profits in the long term because
of
Business uncertainties. However, a company can earn maximum profits even in the long-term, if:

The finance manager takes proper financial decisions, He uses the finance of the company properly.

Wealth maximization:
Wealth maximization (shareholders’ value maximization) is also a main objective of
financial management. Wealth maximization means to earn maximum wealth for the shareholders.
So, the finance manager tries to give a maximum dividend to the shareholders. He also tries to
increase the market value of the shares. The market value of the shares is directly related to the
performance of the company. Better the performance, higher is the market value of shares and vice-
versa. So, the finance manager must try to maximize shareholder’s value.
Proper estimation of total financial requirements:
Proper estimation of total financial requirements is a very important objective of financial
management. The finance manager must estimate the total financial requirements of the company.
He must find out how much finance is required to start and run the company. He must find out the
fixed capital and working capital requirements of the company. His estimation must be correct. If not,
there will be shortage or surplus of finance. Estimating the financial requirements is a very difficult
job. The finance manager must consider many factors, such as the type of technology used by
company, number of employees employed, scale of operations, legal requirements, etc.
Proper mobilization:
Mobilization (collection) of finance is an important objective of financial management. After
estimating the financial requirements, the finance manager must decide about the sources of finance.
He can collect finance from many sources such as shares, debentures, bank loans, etc. There must be
a proper balance between owned finance and borrowed finance. The company must borrow money at
a low rate of interest.
Proper utilization of finance

Proper utilization of finance is an important objective of financial management. The finance
manager must make optimum utilization of finance. He must use the finance profitable. He must not
waste the finance of the company. He must not invest the company’s finance in unprofitable projects.
He must not block the company’s finance in inventories. He must have a short credit period.
1.1.5 SCOPE OF FINANCE MANAGEMENT

Some of the major scopes of financial management are as follows:
Investment Decision
Financing Decision
Dividend Decision
Working Capital Decision.
Investment Decision:
The investment decision involves the evaluation of risk, measurement of cost of capital and
estimation of expected benefits from a project. Capital budgeting and liquidity are the two major
components of investment decision. Capital budgeting is concerned with the allocation of capital and
commitment of funds in permanent assets which would yield earnings in future.
Financing Decision:
While the investment decision involves decision with respect to composition or mix of assets,
financing decision is concerned with the financing mix or financial structure of the firm. The raising
of funds requires decisions regarding the methods and sources of finance, relative proportion and
choice between alternative sources, time of floatation of securities, etc. In order to meet its investment
needs, a firm can raise funds from various sources.
Dividend Decision:
In order to achieve the wealth maximization objective, an appropriate dividend policy must
be developed. One aspect of dividend policy is to decide whether to distribute all the profits in the
form of dividends or to distribute a part of the profits and retain the balance. While deciding the
optimum dividend pay-out ratio (proportion of net profits to be paid out to shareholders). The
finance manager should consider the investment opportunities available to the firm, plans for
expansion and growth, etc. Decisions must also be made with respect to dividend stability, form of
dividends, i.e., cash dividends or stock dividends, etc.

Working capital decision
Working capital decision is related to the investment in current assets and current liabilities.
Current assets include cash, receivables, inventory, short-term securities, etc. Current liabilities consist
of creditors, bills payable, outstanding expenses, bank overdraft, etc. Current assets are those assets
which are convertible into a cash within a year. Similarly, current liabilities are those liabilities,
which are likely to mature for payment within an accounting year.
1.1.6 FINANCE FUNCTIONS:

Finance function is the vital part of a business system. The need for money is endless. Hence
it is not possible to separate this entity from business. The firm requires fund for its survival of
business and future expansion. Finance manager should manage to raise funds from various sources
and effectively utilize in order to meet the objectives of an organization.
The term finance function can be defined as “procurement of funds and their effective utilization in
the business Finance function broadly classified into two types:
Managerial finance functions

Investment decision: involves the type and volume of assets to be acquired Financial decision:
involves the decision about the various sources and the extent of funds to be obtained. Dividend
decision: involves the extent of profits to be allocated and the extent of profit to be retained.
Routine finance functions
Supervision of cash receipts and payments and safeguarding of cash balances.
Custody and safeguarding of securities, policies and other valuable
documents.Record keeping of financial transactions and reporting.
1.1.7 AIMS OF FINANCE FUNCTION

The primary aim of finance function is to organize funds required for business to achieve
these following aspects are required:

The main of finance function is to acquire sufficient funds from the right sources. Some ofthe sources
to be tapped are by issue of shares, issue of debentures and borrowing term loans etc.
The funds raised should be effectively utilized to gain maximum benefit and funds should not remain
idle at any point of time in the business. The returns from the use of funds should be more than cost.
Next aim of finance function is to increase the profitability of a firm. Proper planning and controlling
of finance function should be done with optimal use of resources.
It aims at maximizing the value of a firm, which is connected to profitability.
After the investment of funds, proper analysis and interpretation is required to ensure profitability
investment in order to increase the yield.
Proper financial management protects the interest of creditors, shareholders, employees.
1.1.8 ABOUT THE TOPIC

This topic aims to establish the relationship between capital structure and financial
performance of the company. Capital structure is a combination of a company’s long-term debt and
certain shot term debts, common equity and preferred equity. The capital structure is how a firm
finances its overall operations and growth byusing different sources of funds. Capital structure
includes debts comes in the form of bond issues or long-term notes payable and equity is classified
as common stock, preferred stock or retained earnings. Short term debt such as working capital
requirements is also considered to be part of capital structure. By analysing the company’s portion
of short- term debt and long-term debt capital structure is to be considered. It is the determination of
ratio of capital to be raised from different sources. Equity and debt are the two principal sources of
finance. The capital structure decision involves the portion of equity and debt. It is commonly used
to specify long term sources of funds engaged in a business enterprise. The capital structure of a
company refers to how and here a company raises finances. There are only two ways that a company
can raise the necessary finances. It can raise funds from its owners or borrow from large sources. A
company can also choose to employ a combination of these two methods in varying proportions. In
essence therefore, capital structure refers to how the company combines debt and equity to raise the
required funds. Capital structure of the firm is the combination of different permanent long-term
financing like debt, stock, preferred capital etc. it also refers to the long-term obligations, which are
distributed between owners and creditors.
In today’s uncertain business climate, it is critical for companies to optimize their capital

structure and make sure that they retain access to capital. The challenge is to create a structure that
will be workable through multiple business cycles. Determining an optimal capital structure is also a
Important step for acquires as they tackle valuation and integration issues. In the simplest terms, a
company’s debt capacity comes downto its ability to repay debt and to support ongoing working
capital. However, as the past few years have demonstrated, it is not always simple to predict cash
flows especially in a volatile economic climate. A company needs to have a comprehensive
understanding
of its financial position before it can determine what its capital structure should look like. It is not
uncommon for two companies in the same industry to have identical debt-to- equity ratios, but
significantly different cash flow capabilities because of difference in growth rate, cost structure,
profitability and asset turn over. Any analysis should therefore include a review of how operating
and financial leverage will affect a company’s ability to make loan payments. Once a company
decides to access the capital markets, it needs to be educated as to the various capital providers and to
appropriate market terms and pricing in each layer of a capital structure.
1.1.9 MEANING OF FINANCING DECISION
The financing decision involves two sources from where the funds can be raised: using a company’s
own money, such as share capital, retained earnings or borrowing funds from the outside in the form
debenture, loan, bond, etc. The objective of financial decision is to maintain an optimum capital
structure
1.2 MEANING OF CAPITAL STRUCUTRE
Capital structure is the composition of long-term liabilities, specific short-term liabilities like bank
notes, common equity, and preferred equity which makes up the funds with which a business firm
finances its operations and its growth. The capital structure of a business firm is essentially the right
side of its balance sheet.
Capital structure refers to the combination of debt and equity which a company uses to finance its
long- term operations. The capital structure is how a firm finances its overall operations and growth
byusing different sources of funds. Raising of capital from different sources and their use in different
assets by a company is make on the basis of certain principles that provide a system of capital so that
the maximum rate of return can be earned at a minimum cost. This sort of system of capital is known
as capital structure.

1.2.1 DEFINITION OF CAPITAL STRUCTURE
According to Gerestenberg, “capital structure of a company refers to the composition or mix
up of its capitalization and it includes all long-term capital resources viz., loans, reserves, shares and
bonds”.
According to P. Chandra, “capital structure is essentially concerned with how the firm
decides to divide its cash flows into two broad components, a fixed component that is earmarked to
meet the obligations towards debt capital and a residual component that belongs to equity
shareholders”.
Hence capital structure implies the composition of funds raised from various sources broadly
classified as debt and equity. It may be defined as the proportion of debt and equity in the total
capital that will remain invested in a business over a long period of time. Capital structure concerned
with the quantitative aspect. A decision about the proportion among these types of securities refers to
the capital structure decision of an enterprise.
1.2.3 MEANING OF FINANCIAL STRUCTURE
Financial structure is a mix of equity and debt Used by a company for operating. It can have a
strong influence on the risk and value of associated business. The financial managers of the company
deal with the responsibility of deciding the right mixture of equity and debt to optimize the financial
structure.
1.2.4 MEANING OF CAPITALISATION STRUCTURE
Capitalization structure refers to the proportion of debt and equity in the capital configuration
of a company. Capital-in the form of money, assets, intellectual property, or other financial assets
Assets-is how a company funds itself debt is a loan issued to the company by an inventor.
1.2.5 MEANING OF OPTIMAL CAPITAL STRUCTURE

The combination of debt and equity that leads to maximization of the value of the firm is
called optimal capital structure. It maximizes the wealth of the owners and minimizes the cost of
capital.
1.2.6 FEATURES OF CAPITAL STRUCTURE
An appropriate capital structure should have the following features.

It allows maximum possible use of leverage
It involves minimum possible risk of loss of control.

It helps to avoid undue restrictions in agreement of debt.
It takes care that use of debt within the capacity of a
firm
The firm should be in a position to meet its obligations in paying the loan and interest charges as and
when they fall due.
1.2.6 FORMS OF CAPITAL STRUCTURE
Capital structure pattern varies from company to company and the availability of finance.
Normally the following forms of capital structure are popular in practice.
 Equity shares only.
 Equity and preference share only.
 Equity and Debentures only.
 Equity shares, preference shares and debentures.
1.2.7 SIGNIFICANCE OF CAPITAL STRUCTURE
Capital structure is very important to survive the business in long run. The right capital
structure planning also increases the power of company to face the losses and changes in financial
markets. Following points shows the significance or importance of capital structure and its planning.
 Capital structure helps to reduce the overall risk of company

When capital structure is made before actual getting money from supplier can do many
adjustments for reducing overall risk of company. We try to get minimum debt in new business
because in new business our rate of return will be less than rate of interest and for getting more loans
means taking high risk of return more amount of interest even there is no profit.
 Assists to do adjustment according to business environment:
Company also adjusts different sources expected amount according to business environment.
Suppose in future, if government of India cuts off his relation with china, from where our company is
getting fund, it will definitely tough for us to get more money from china. But proper planning of
capital structure of future sources will be helpful for us to enlarge our area for getting money. In
finance, it is called maneuverability. It means to create mobility of sources of fund by including
maximum alternatives in planned capital structure. Suppose, if RBI increases the interest rate, it
means our cost for getting debt will be high at that time, you can choose any other cheap source of
fund.

 Helps for new idea generation of new source of fund:
Good planning of capital structure will make versatile to finance manager for getting money

for new sources. Promoters or managers do meet with investors and motivate them by showing the
special event. Through this promoter may get new ideas and getting fund from different sources.
1. 2 8 FACTORS AFFECTING CAPITAL STRUCTURE

The effective capital structure is based on certain basic factors, which have combines with the
capital combination. These capital combination factors may be internal or external. The factors which
are external, where there will be no hold on the companies and company should change its functions
based on the common factors. As in case of internal factors, where the company have a control and
canchange based on common circumstances. These factors are explained below. External factors are
the factor which is over and above the control of individual firm. These factors have bearing on the
capitalstructure of the individual firm. The following are the factors.
 Market:
IT plays a vital role in terms of sources of finance. Efficient market can always provide
required quantum of funds in different combination. When the firm formulated the capital structure it
has to consider the prevailing market environment and act accordingly.
 Investor’s behavior:
Capital structure of the firm is purely based on the behaviour aspect of the investor. Human
behavior changes frequently, thereby investors demand on the rate of return on investment may
change frequently. Company has to change its capital structure policy according to the behavior of
the investors.
 Required rate of return:
As the investors well informed about the investment opportunities in the market is the demand
for the return-on-investment increases. The company capital structure should provide for the
variation in the rate of return.
 Growth opportunities:
The mix of assets in place versus growth opportunities has four implications for capital
structure. First high assets in place make the firm have better collateral for loans. Second bankruptcy
costs and disruption caused by managers know more about their company’s prospectus than outsiders.
Fourth, financial flexibility is more important for firms with growth opportunities.
1.2.9 A COMPLEX CAPITAL STRCTURE PATTERN

Equity shares and debentures (i.e., long term debt including bonds etc.),
Equity shares and preference shares,
Equity shares, preference shares and debentures (i.e., long term debt including bonds etc.),
However, irrespective of the pattern of the capital structure, a firm must try to maximize the earnings
per share for the equity shareholders and also the value of the firm.
1.2 10 ADVANTAGES OF CAPITAL STRUCTURE

 Amplifies return on equity: ROE, is commonly used as a measure of business performance.
It is the product of product of earnings, asset turnover and financial leverage or debt. The
more leverage or debt you have in your capital structure, the more it amplifies your potential
earnings.
 Greater control and flexibility: Debt financing allows you to keep full ownership over your
business. With full ownership comes complete control equity financing is an investment in
the ownership right of the company.
 Equity advantages: Capital structure also provides flexibility in raising funds.one advantages
for small business is that it is generally more available than debt financing if your business is
unproven, lenders have nothing to base future cash flows on.
 No liability to redeem: Capital raised through equity shares does not have to repaid until the
company itself is would up this would be long-range planning in respect of the company.
 Voting control right: Equity shares entitle the owner to control and manage the company.
Equity shares are greatly preferred by bold and risk-loving investors because owners of equity
shares are real owner of a company.
1.2.11 DISADVANTAGES OF CAPITAL STRUCTURE:
 Signal of capitalization: If promoter miscalculates in working out financial requirement of a
company. The company may land in a situation where it has a large surplus of capital.
 High cost of fund raising: As many bold risk loving investors is always small. The company
has to spend much time and money to rise equity capital.
 Absence of close control: In a company which is a financed largely by equity shares. The
number of equity shareholders will be quite large. As such it would become difficult to have
effective management and control of its affairs due to wide diffusion of ownership.
 Delusion of trading on equity: The company with both equity and preference shares can

trade on the equity, but not to any significant extent.
 Absence of close control: In case the company makes any default in paying dividend to
preference shareholder. They will earn the right to attend the general meeting and to vote on
matters affecting their interest
1.2.12 CAPITAL STRUCTURE THEORIES

The capital structure theories are assisting the business organization to identify the optimal capital
structure. The capital structure of the organization differs from one approach to another due the
assumption which are underlying with reference to many factors of influence. The success of the
firm is normally depending upon the rate at which the financial resources are raised, differs from one
organization to another depends upon the needs.
1.2.13 VARIOUS CAPITAL STRUCTURE THEORIES

Various capital structure theories are as follows:
1. Net Income Approach (NI)
2. Net Operating Income Approach (NOI)
3. The Traditional Approach
4. Modigliani-Miller Hypothesis (M-M)

1. Net Income Approach (NI)
This theory argues that debt will influence the value of the firm. This theory war proposed by David
Durand, and is also known as “fixed Ke theory”.
According to this approach, the cost of equity capital and cost of debt capital are assumed to be
independent to the capital structure. The value of the firm rises by the use of more and more leverage
and the weighted average cost of capital declines. The cost of debt (rd) and cost of equity (re) remain
unchanged when D/E varies. Because of rd and re being constant with respect to D/E, it means that
rA, the average cost of capital isrA = rD (D/D+E) + rE (E/D+E)
Declines as D/E increases. This occurs because when D/E increase, rD. Which is lower than rE, have
higher weight in the calculation of rA.
Total value of the firm (V) = S + D
S= Market value of shares D= Market value of debentures
Over cost of capital (Ko)= NOI/V for example:
Two firms A and B one with zero leverage and the other with 50%leverage. Means half of the total
assets have been financed by debt.
Assumptions:
1. The use of debt not change the risk perception of investors, as a result, the equity capitalization
rate and the debt capitalization rate remain constant with changes in leverage.
2. The debt capitalization rate is less than equity capitalization rate.
3.Corporate income taxes do not exist.
2. Net Operating Income Approach:

According to the net operating approach, the cost of equity increases in accordance with
leverage. Due to which the weighted average cost of capital remains constant and the value of the
firm also remains constant as leverage is changed. The overall capitalization rate and the cost of debt
remain constant for all degree of leverage.
RA= rD (D/D+E) + rE (E/D+E)
RA and rD are constant for all degree of leverage. The cost of equity is RE= rA + (rA – rD) D/E
The net operating income position has been advocated by David Durand. He argued that the market
value of a firm depends on its net operating income and business risk. The change in the degree of
leverage employed by a firm cannot change these underlying factors. It merely changes the
distribution of income and risk between debt and equity without affecting the total income and risk
which influencethe market value of the firm.
Assumptions:
 The market capitalizes the value of the firm as a whole. Thus, the split between debt and
equity is not important.

 The market uses an overall capitalization rate to capitalize the net operating income this rate
depends on the business risk. If business risk is assumed to remain unchanged, the
capitalization rate is a constant.
 The use of the costly debt funds increases the risk of shareholders. This causes the equity
capitalization rate to increases. There the advantage of debt is offset exactly by the increases
in equity capitalization rate.
 The debt capitalization rate is a constant.
3 .The Traditional Approach:

The net income theory and net operating income theory stand in extreme forms traditional
approach stands in midway between these two theories. This traditional theory was advocated by
financial experts Ezta Solomon and Fred Weston. According to this theory a proper and right
combination of debt and equity will always lead to market value enhancement of the firm. This
approach accepts that the equity shareholders perceive financial risk and expect premiums for the
risks undertaken. This theory also states that after a level of debt in the capital structure, the cost of
equity capital increases.
Traditional approach to capital structure suggests that there exists an optimal debt to equity ratio
where the overall cost of capital is the minimum and market value of the firm is maximum. On either
side of the point, changes in the financing mix can bring positive change to the value of the firm.
Before this point, the marginal cost of debt is less than cost of equityand after this point vice–versa.
Capital structure theories and its different approaches put forth the relation between the proportion of
debt in financing of a company’s assets, the weighted average cost of capital (WACC) and the market
of the company. While net income approach and net operating income approach are the two extremes
approach, traditional approach, advocated by Ezta Solomon and Fred Weston is a midway approach
also known as “intermediate approach”.
Traditional approach to capital structure advocates that there is a right combination of equity and
debtin the capital structure, at which the market value of the firm is maximum. As per this approach,
debtshould exist in the capital structure only up to a specific point, beyond which any increase exist
in leverage would result in reduction in value of the firm.
It means that there exists an optimal value of debt-to-equity ratio at which the WACC is the lowest
and the market value of the firm is the highest.

Assumptions under Traditional Approach
 The rate of interest on debt remains constant for a certain period and thereafter with
increases in leverage, it increases.
 The expected rate by equity shareholders remains constant or increases gradually. After that
the equity shareholders starts perceiving a financial risk and then from the optimal point
and the expected rate increases speedily
 As a result of activity of rate of interest and expected rate of return, the WACC first
decreases and then increases. The lowest point on the curve is optimal capital structure.
For example:
Consider a fictitious company with the following data
Proportion of debt =20%, Proportion of equity =80%, Cost of debt =10%, cost of equity =13%.
Solution: WACC= (Weight of Debt*Cost of Debt) + (Weight of Equity* Cost of Equity)
= (20%*10%) + (80%*13%)
= 2+10.4
=12.4%
Now, assume the company increases its financial leverage and as a result, the debt is 30% and the
equity is 70%. The cost of debt and equity also rise because of the company’s higher exposure to risk.
The new WACC is calculated as follows:
Proportion of debt =30%, Proportion of equity =70%, Cost of debt =11%, cost of equity =14%.
Solution: WACC= (Weight of Debt*Cost of Debt) + (Weight of Equity* Cost of Equity)
= (30%*11%) + (70%*14%)
= 3.3+9.8
=13.1%
As observed, with the increase in the financial leverage of the company, the overall cost of capital
reduces, despite the individual increases in the cost of debt and equity respectively. The reason being
that debt is a cheaper source of finance.
Now, assume the company increases its financial leverage further and as s result, the debt is 50%
and equity is 50%. The cost of debt and equity rise further. The new WACC is calculated as follows.
Proportion of debt =50%, Proportion of equity =50%, Cost of debt =12%, cost of equity
=15%. Solution: WACC= (Weight of Debt*Cost of Debt) + (Weight of Equity* Cost of
Equity)

= (50%*12%) + (50%*15%)

= 6+7.5
=13.5%
As observed, with the increase in the financial leverage of the company to the current levels, the over
cost of capital increases. The above exercise shows that increasing the debt reduces WACC, but only
to a certain level. After that level is crossed, a further increase in the debt levelincreases WACC and
reduces the market value of the company
4. Modigliani- Miller hypothesis:

This theory was first proposed by Franco Modigliani and Merton Miller in the classic
contribution in capital structure which is regarded by many as the most important paper on modern
finance. This work stands as the watershed between old finance an essentially loose connection of
beliefs based on accounting practices, rule of thumb and modern financial economics, with is rigorous
mathematical theories and carefully documented empirical studies.
Assumptions:
 No corporate taxes.
 Perfect market.
 Expected earnings of all firms have same risk.
 Investors act rationally.
 The cut-off point of investment is capitalization rate.
 Earnings are distributed to the shareholders.
The value of the firm is equal to its expected operating income divided by the discount rate
appropriate to its risk class. It is independent of its capital structure.
R = r + E = o/r r = Market value of the firm. E = Market value of equity.
D = Market value of stock. K = Discount rate available.

5 Revised M and M proportion
The Modigliani-Miller theorem forms the base for modern thinking on capital structure. The basic
theorem states that, under a certain market price process, in the absence of taxes, bankruptcy cost,
agency cost, and asymmetric information, and in an efficient market, the value of a firm is unaffected
by how that firm is financed. It does not matter what the firm’s dividend policy is, therefore
Modigliani-Miller theorem is also often called the capital structure irrelevance principle.
Without taxes Proportion I:
VU= VL where VU is the value of an unlevered firm = price of buying a firm composed only of
equity, and VL is the value of a levered firm = price of buying a firm that is composed of some mix
of debt and equity. Another word for levered is geared, which has the same meaning. Suppose an
investor is considering buying one of the two firms U or L. instead of purchasing the shares of the
levered firm L, he could purchase the shares of the firm U and borrow the same amount of money B
that firm L does. The eventual returns to either of these investments would be the money borrowed B,
which is the value of L’s debt. We have implicitly assumed that the investor’s cost of borrowing
money is the same as that of the firm, which need not to be true in the presence of asymmetric
information in the absence of efficient markets.
Proportion II:
Proportion II with risky debt. As leveraged (D/E) increases, the WACC (k0) stays constant. A higher
debt to equity ratio leads to a higher required return on equity, because of the higher risk involved for
equity holder in a company with debt. The formula is derived from the theory of weighted average
cost of capital.
With Taxes
Proportion I:
There are advantages for firms to be levered, since corporations can deduct interest payments.
Therefore, leverage lowers tax payments. Dividend payments are non-deductible.
Proportion II:
rE= rO + D/E (rO - rD) (1 – TE) where,
rE is the required rate of return on equity, or cost of levered equity = unlevered equity + financing
premium, rO is the company cost of equity capital with no leverage, rDis the required rate on
borrowings, or cost of debt, D/E is the debt-to-equity ratio, TE is the tax rate. The same relationship
as earlier described staying that the cost of equity rises with leverage, because the risk to equity rises,

still holds. The formula however has implications for the difference with the WACC. Their second
attempt on capital structure included taxes has identified that as the level of the WACC drops and an
optimal capital structure does indeed exist at a point where debt is 100%.
Assumptions:
 Corporations are taxed at the rate on earnings after interest.
 No transaction costs exist, and Individuals and corporations borrow at the same rate.

2.1 MEANING OF REVIEW OF LITERATURE
A literature review surveys books, scholarly articles, any other sources relevant to a
particular issue, area of research, or theory, and by so doing, provides a description, summary, and
critical evaluation of these works in relation to the research problem being investigated. Literature
reviews are designed to provide an overview of sources you have explored while researching a
particular topic and to demonstrate to your readers how your research fits within a larger field of
study.
2.2 DEFINITION
According to Cooper, H.M., “literature review uses as its database reports of primary or
original scholarship and does not report new primary scholarship itself. The primary reports used in
the literature may be verbal, but in the vast majority of cases reports are written documents. The
types of scholarship may be empirical, theoretical, critical/analytical or methodological in nature.
Second a literature review seeks to describe summaries, evaluate, clarify and/or integrate the content
of primary reports”.
2.3 IMPORTANCE OF A GOOD LITERATURE REVIEW

A literature review may consist of simply a summary of key sources, but in the social
sciences, a literature review usually has an organizational pattern and combines both summary and
synthesis, often within specific conceptual categories. A summary is a recap of the important
information of the source, but a synthesis, is a re- organization, or a reshuffling, of that information
in a way that informs how you are planning to investigate a research problem. The Depending on the
situation, evaluate the sources and advice the reader on the most pertinent or relevant research, or
Usually in the conclusion of a literature review, identify where gaps exist in how a problem has been
researched to date.
2.4 Purpose of review of literature:

 Provide foundation of knowledge on topic.
 Identify areas of prior scholarship to prevent duplication and give credit to other researchers.

 Identify inconstancies: gaps in research, conflicts in previous studies, open questions left from

another research.
 Identify need for additional research (justifying your research).
 Identify the relationship of works in context of its contribution to the topic and to other works.
 Place your own research within the context of existing literature making a case for why
further study is needed.
2.5 Steps in writing review of literature:
 Narrow your topic and select papers accordingly Search for literature.
 Read the selected articles thoroughly and evaluate them.
 Organize the selected papers by looking for patterns and by developing subtopics.
 Develop a thesis or purpose statement.
 Write the paper.
 Review your work.
2.6 LITERATURE REVIEWS

Michalak (2015),
A. Michalak pointed out that, under a different approach, it is necessary to distinguish
between the concepts of financing structure and capital structure. In this context, the financing
structure indicates how an enterprise is financed and is, therefore, reflected in the liabilities of the
balance sheet. On the other hand, the structure of capital is understood as equity from the issue of
shares, privileged capital, and long-term debt. In this sense, the capital structure is part of the
financing structure. Thus,
the financing structure includes equity and long-term external capital as well as current liabilities.
Thus, the capital structure corresponds to the structure of the liabilities less the current liabilities. The
fact that the current liabilities are excluded from the consideration is a result of the fact that their value
fluctuates; therefore, the capital structure is determined by equity and long-term liabilities in the
longer term. A different approach to the capital structure takes equity, long-term liabilities, and
interest- bearing short-term liabilities into account. This results from the assumption that the entities
that invest capital in an enterprise are oriented towards obtaining income that they can obtain from
this account.

L. Pacheco (2016)
L. Pacheco had listed the following in the theories that determine the determinants that
influence the choice and proportions of equity and foreign capital: the static trade-off theory, the
agency cost theory, and the pecking order theory. The sample of firm is also used to examine the cost
and speed of adjustment towards a target debt ratio. They applied a target adjustment model is
estimated using a generalized method of moments techniques to examine the cost and speed of
adjustment towards a target debt ratio.
Sierpi´nska and Jachna (2017)
The capital structure that enables a minimization of the weighted average cost of capital
leadsto a maximization of a company’s value, as the expected cash flows are discounted at a lower
discountrate. The concept of capital structure is sometimes understood in various ways; there is no
consensusas to its definition. Further they also examined the determinants of target capital structure
for South Africa listed firms. Their results suggest that these firms bear greater transaction costs when
adjustingto a target debt ratio than to a target long-term debt ratio.
K. Ardalan (2017)
K. Ardalan defined capital structure as a mixture of debt and equity. On the other hand, the
use of debt by the company should be used to enhance the company's operations, expansion, and
increase sales, so that the company's profitability can be increased. Firm’s Value is investor
perception of the
company, which is often associated with stock prices. High stock prices could show shareholder
value. The Firm's value can be estimated with Tobin's Q, which is the replacement cost required to
obtain the same assets with the assets of the company. The purpose of this study was conducted to
examine the relationship between capital structure (DER), the company's performance (ROE) and
Firm value (Tobin's Q) of companies listed on the Indonesian Stock Exchange.
Khemiri and Noubbigh (2018)
Khemiri and Noubbigh Indicated that capital structure is represented by the average debt–
equity ratio of companies and capital structure is the optimal combination of equity and long-term
debt according to Khémiri and Noubbigh. Basically, the division of the capital structure theory may
concern the following
* Inference related to particular theories and therefore whether the debt affects the market value of an

enterprise.

*Accounting for taxation tax and non-tax theories.
*Assumptions about the functioning of the market.
Gajdka and Szyma´nski (2019)
The existence of a tax shield increases the market value of the enterprise along with an
increase in debt, because the financial costs reduce the tax base. From the regression outcomes, the
study indicates that capital structure measured by debt to equity and long-term debt to total assets has
a significant positive correlation with return on equity (ROE) and return on assets (ROA). However,
the capital structure measured by debt to assets has a significant negative correlation with ROE and
ROA.
Orlova et al. (2020)
Orlova ET al. pinpointed that capital structure is usually presented in the context of a choice
between debt and equity. Thus, the capital structure corresponds to the structure of the liabilities less
the current liabilities. The fact that the current liabilities are excluded from the consideration is a
result of the fact that their value fluctuates; therefore, the capital structure is determined by equity
and long- term liabilities in the longer term.
Nguyen et al. (2021)
T. Nguyen, M. Bai, Y. Hou, and M. Vu noted that, according to the trade-off theory, any
deviation of the financial leverage from the optimal capital structure may result in a reduction in a
company’s value. However, this theory does not seem to explain those situations in which debt is
completely absent. The capital structure is part of the financing structure. Thus, the financing
structure includes equity and long-term external capital as well as current liabilities. Thus, the capital
structure corresponds to the structure of the liabilities less the current liabilities. The fact that the
current liabilities are excluded from the consideration is a result of the fact that their value fluctuates;
therefore, the capital structure is determined by equity and long-term liabilities in the longer term. A
different approach to the capital structure takes equity, long-term liabilities, and interest-bearing
short- term liabilities into account. This results from the assumption that the entities that invest
capital in an enterprise are oriented towards obtaining income that they can obtain from this account.

2.7 RESEARCH DESIGN
A research design is a plan for comprehensive data collection to answer research questions
and or test research hypotheses. A research design is a master plan specifying the methods and
procedures for collecting and analyzing the data. Research design is a blue print of action. It consists
of detailed prescriptions for solving problems from either a scientific or humanistic perspective. It
involves a series of rational decision-making choices regarding the purpose of the study, its scope, its
location, the type of investigation, the extent to which it is controlled and manipulated by researcher,
the time aspects, the collection, measurement and analysis of data. This is a systematic plan to study a
scientific problem. The design of a study defines the study type and sub- type, research question,
hypotheses, independent and dependent variables, experimental design and if applicable data
collection methods and a statistical analysis plan. Research design is the frame work that has been
created to seek answers research question.
2.7.1 TITLE OF THE STUDY
“A study on impact of capital structure on profitability at METRO CASH AND CARRY,Bangalore.”
2.7.2 MEANING OF RESEARCH
Research is a systematic investigation process employed to increase or revise current
knowledge by discovering new facts.
2.7.3 DEFINITION OF RESEARCH
According to Black and Champion, research can be defined as “obtaining information through
empirical observations that can be used for the systematic development of logically related
propositions attempting to establish casual relations among variables”.
2.7.4 MEANING OF RESEARCH DESIGN

The research design is a plan of action the specific steps that are necessary to provide answers
to those questions, test the hypotheses, and thereby achieve the research purpose that helps choose
among the decision alternatives to solve the management problem or capitalize on the market
opportunity.
2.7.5 DEFINITION OF RESEARCH DESIGN
According to Green and Tull, “A research design is the specification of methods and
proceduresfor acquiring the information needed. It is the overall operational pattern or framework of
the project that stipulates what information is to be collected fromwhich source bywhat procedures”.

2.7.6 STATEMENT OF THE PROBLEM
The first and foremost step in the research process is selecting and properly defining a research
problem where the researcher must find the problem and formulate it so that it becomes researchable.
Capital structure analysis impact on financial performance is very useful to judge the current financial
position of the company. This study aims at the risk and return relationship between the debt’s equity
funds needed for the organization. The goal of capital structure is to manage the firm’s debt and equity
in such a way that available resources are used in an effective way to meet the satisfactory level of
firm. It deals with the interrelation between debt and equity with the help of ratios.
2.7.7 NEED FOR THE STUDY
The research will be done at Metro cash and carry, situated at Kanakapura. The study aims at
analyzing the various concepts related to the investment pattern of investors and its importance in the
development of the organization. So, the project work is confirmed to finance department and it address
the financial tools which are used to increase the financial performance of the firm. The capital
structure of the company is analyzed from 2018-2022. Based on the observation during the study
period some of the suggestions will be made which are applicable to Metro cash and carry.
2.7.8 OBJECTIVE OF THE STUDY

 The primary objective is to analyze the financial position of Metro cash and carry for the
period of five years.
 To analyze the capital mix of the company. And to analyze the current performance of the
company with reference to their debt and equity mix.
 To offer appropriate findings and suggestions to the company based on the study.
2.7.9 SOURCE OF
DATA Primary Data
Primary data refers to information gathered first hand by the researcher for the specific
purpose of the study. It is raw data without interpretation and represents the personal or official
opinion or position. Primary sources are most authoritative since information is not filtered or
tampered. Primary source of the information is collected from the finance manager of the METRO
CASH AND CARRY Secondary Data
Secondary data refers to the information gathered from already existing sources. Secondary
data may be either published or unpublished data. Secondary information is collected from the
following
 Company website

 Books
 Magazines
 Internet
 Reports
2.7.10 PROCESSING
 Tables
 Graphs
2.8 METHODOLOGY
Descriptive research is study of existing facts to concluded, in the research an attempt has been
made to analyze the past performance. A research design is a method and procedure for acquiring
information needed to solve the problem. A research design is the basic plan that helps in the data
collection or analysis, it specifies the type of information to be collected the sources and data
collection procedure.
2.9 USEFULLNESS OF THE STUDY
The studyhelps in finding the strength and weakness ofthe company and also reason for
increase and decrease in profitability. It gives the management a broad idea about its past
performance and this will help them to take corrective measures.
2.10 REFRENCE PERIOD

In this project annual reports of five years had been taken for references, the financial years
follows
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020

LIMITATIONS OF THE STUDY
 The analysis of capital structure management is mainly based on the published annual report
of the company i.e., secondary data. So, the data may differ between published and original.
 They study restricted for a period of 5 years commencing from 2018-2019 to 2021-2022. So,
it shows limited period data are considered.
 Time is one of the main limitations of this study and within this time all aspects cannot
be studied in detail.

CHAPTER-2
COMPANY PROFILE AND
OVERALL
ORGANIZATIONAL
STUDY
31

INDUSTRY PROFILE
METRO CASH AND CARRY
It is a wholesale industry that wholesale are the middleman where they buy products distribution
and sell it to retails. The retailer go to the entire dealer to purchase items to recharge their stock
Anyway, the wholesalers exploring their preliminary, wholesalers may likewise pitch to the end
clients yeast such deals are negligible.
India FMCG advertising has two broad types of all sellers.

1. Modern discount stores, for example Wal-Mart Best Value, metro
2. The neighborhood entire vender around the lanes in India
32

Discount providers acquire goods in large quantities, manufacturers, wholesalers, and
wholesalers are in accordance with the necessary items for low cost-cost providers. For this
reason, the trader wholesaler discounted a great buyer that discounts is more cheaper than
retailers, but it depends on the number of agents.to break through all the additions of the edges
to respect the transactions. Reason why retailer purchasing from wholesaler:
• Direct wholesalers directing terms

• Best bargains at discount
• Feel high products and brands
Retail stores face several disadvantages when purchasing from wholesalers.
• Buy stuff for fast money

• Transportation cost the merchandise
• Wholesalers do not restore unsold / stock
About METRO cash and carry
The subway is a major international specialist of wholesale and grocery operated in

34 countries, and employs more than 97,000 people around the world. 2020/21 Subway
sales during fiscal year.
Euro 25.6 billion. Subway cash and carriers are a wholesale partition of the subway.
The company offers a private solution that meets the regional and international
requirementsof wholesale and retail customers.
Metro is leading international specialist in Food retail and wholesale and having 17
Million customers overall around the world. Its having around 681 stores globally.
With small and medium-sized entrepreneurships being the backbone of the Indian
economy, METRO Cash & Carry prides itself on being the Champion for Independent
Business, by helping them thrive, be profitable and make a difference to the
community.
Assortment and service of METRO Cash & Carry’s unique business-to- business model
are targeted only towards professional customers such as hotels and restaurants as well
as small and mid-sized retailers or institutions. The company offers these special groups
a high level of assortment competency both in food and nonfood as well as attractive
wholesale prices. An efficient and internationally conferrable concept ensures
success in entering new markets.
33

Reliance retail Takeover Metro cash and carry for 2850 crores
A Subsidiary of Reliance industries ltd, on 2022, December 22 Signed definitive agreements to acquire
100 percent equity stake in metro cash and carry pvt ltd. For a cash consideration of 2850 crores.
This is going to help Reliance Retail, the country's largest retailer, expand its presence in the
B2B segment. Discussion between billionaire Mukesh Ambani-led Reliance Industries and METRO
was going on for the past few months and last week the German parent firm agreed to the offer from
Reliance Retail, they added. When contacted, both METRO and Reliance Industries declined to
comment on thedevelopment.
A Reliance spokesperson said, "Our company evaluates various opportunities on an ongoing basis."
METRO AG's spokesperson said, "We do no comment on market rumor or speculations."
METRO Cash & Carry's customers include retailers and kirana stores, hotels, restaurants and caterers
(HoReCa), corporates, SMEs, companies and institutions.
The B2B segment is considered to be a low-margin business and multinationals such as Carrefour have
exited from the country in 2014.
In July 2020, e-commerce major Flipkart Group acquired 100 per cent stake in WalmartIndia Pvt Ltd,
which operates the Best Price cash-and-carry business.
Other retailers were also in the race to acquire METRO Cash & Carry, including Siam Makro, which
34

operates Lots Wholesale cash-and-carry trading business under the brand name LOTS Wholesale
Solutions. Last month, Siam Makro, part of the CharoenPokphand Group of Thailand, announced its
withdrawal from bidding for METRO Cash& Carry India. METRO AG, which operates in 34
countries, entered the Indian market in 2003.
It operates six stores in Bengaluru, four in Hyderabad, two each in Mumbai and Delhi, and one each
in Kolkata, Jaipur, Jalandhar, Zirakpur, Amritsar, Ahmedabad, Surat, Indore, Lucknow, Meerut,
Nasik, Ghaziabad, Tumakuru, Vijayawada, Visakhapatnam, Guntur and Hubballi. Reliance
Industries' subsidiary Reliance Retail Ventures Ltd (RRVL) is the holding company of all the retail
companies under the group.
RRVL had reported a consolidated turnover of around ₹2 lakh crore for the year ended March 31, 2022.
Cash and carry concept

Wholesale cash and mainly determined by customer base and unique business models. In
other words, registered business customers visited cash and carrier outlets, choose their own
purchase, and instead of placing orders instead of placing them again. Worldwide subway
daily, our employees can use our staff to be used in a wholesale price, winning a wide range
of business customers with a wide range of up to 50,000 foods and non-food products. Cash
andcarry metro India.
35

Currently, subway cash and transportation Indian market joined in 2003. Currently
Bangalore, Four Hyderabad two each Mumbai, and Delhi, as well as Calcutta, Jaipur,
Jalandhar, Zirakpur, Amritsar, Vijayawada, Ahmedabad, Ahmedabad, Surat, Indore, Likin’s,
Meerut, Nashik, Gaziabad, Tummary, Vitaacnam and Gundur.
Indian Core Matron & Core has small retailers and Kira shops, hotels, restaurants and wires
(Horeca), company, small business, all kinds of offices, companies and professionals. Only
business customers can only be purchased from metro and customer registration cards are
suitable and provided. There is a
36

considerable international understanding of the Indian market in the Indian market for the last
decade, and Subway Cash and Mobile India meet the specific needs of all of these customer
sectors.
India's Metro Cash and India provide about 7,000 first-class products for a variety of categories.
- Fruits, vegetables, products, dairy products, frozen products and tops, fish and meat,
confectionery, detergent and cleaners, health and beauty, media and electronics, houses and
clothes - all roofs and transparent wholesale prices. It helps us to improve our customer's
proposal to supply trusted power. Regional requirements Analysis, a large proportion of
goods at the regional level, and suitable for meeting specific requirements in this area.
Metro has a fast and complex mechanism to ensure that all products comply with the highest
quality. The product is provided as a large quantity package, filler package, or multiple
packages for customer professional convenience. Attendance trust and customers should not
support shares due to uncertainty delivery in the subway. This greatly reduces the cost of
procurement and customers.
The company regularly operates customer interaction programs for a variety of target groups.
The subway focus of Small Traders is to help Kiranes become more competitive and
profitable.It helps them to increase inventory management more efficiently, and you can keep
your product's circulation and storage and better atmosphere and services to your customers.
METRO provides Horeca clients with individual services and interactive information exchange
platforms through a unique company called Manager-O-Logy. It also provides hygiene and
high- quality education initiatives for restaurants, medium and medium Dhabas.
Metro Cash & Carry is an intimate partner of the local economy and strives to attract the
benefits of the community. Farmers collect subways working with fruits and vegetables along
the chain of agricultural chains for new sources, and reduce losses and reduce losses and help
farmers realize the best economic value of the product. Currently, the subway currently
passesthrough the General Center of Karnataka Pates (2), Andhra Pradesh (1), Maharashtra
(1), and West Bengal (1). The company also works near the manufacturer for product
extraction at locallevels near local producers and manufacturers. In each country, the subway
provides a wide range of learning to develop a direct and indirect employment opportunity for
local talents andhas a wide range of technologies.
Metro is one of the autonomous wholesalers. It moves more spare parts such as a couple like
Europe and Asia North Africa and Asia. And this is one of the most important trading of
Germantrade and wholesalers.
Metro is an exceptional Retailer B2C dealer such as Wal-Bazaar, Carrefour and Tesco, such
asWal-Bazaar, Carrefour and Tesco, such as Wal-Bazaar, Carrefour and Tesco, which listens
to professional customers. The Metro & Contery system depends on the acquisition of the
controland the two themselves.
This is one of the major public institutions of the own dealer administration and operates
6.00out of 29 countries. This is the fourth largest in the fifth largest in Germany, which is the
fourthlargest in the second largest in Germany, mainly in the planet, the second, mainly in
Europe.
37

It is active in the area of the 2378 region, and the legislator appeals 2.63,000 people.
METRO provides more obvious efficiency of objective areas. When there is a contrast of a
flexible business network, you must collect a group that provides reasonable source to the
supplier's object by providing the correct answer to the buyer and collecting the group
Vision
• Metro leads the whole country's competitive users throughout the world by
leading thewholesale departments worldwide among special production methods.
Mission
• The metro is the main market of experts and companies.

• Provides the cost of goods and production solutions at the lowest price
Quality Policy
• Recognition Level: Consumers who purchase products in the metro provide

the rightamount for the regularly acquired goods.
• Sustainable power: Provides guarantee according to the type of product being produced.
• Psychosomatic: Metro has as first-class atmosphere workers is a pleasant receptive
Pattern Properties
Stephanie Wiggins -CEO
Neha Jagirdar - Human Resources
Manager Vasanth Kumar - Accountant
Vijay Kumar - General Director
38

A SWOT analysis is a framework that is used to analyze a company’s competitive positioning in its
business environment. This can be used by Metro Cash and Carry, and will involve the identification of
its internal Strengths (S) and Weaknesses (W) followed by the identification of the Opportunities (O) and
Threats (T) it faces in its extensivelyrnal business environment.
Metro Cash and Carry is among the leading firms within its industry, and it needs to retain this
position. Metro Cash and Carry is carefully reviewing its SWOT analysis and using it to make strategic
decisions. For a SWOT analysis to be conducted of the firm, an interactive process needs to be
undertaken by coordinating among all the departments of the firm such as finance, marketing, operations,
human resource, logistics, strategic planning, management information systems etc.
A SWOT matrix is a 2x2 matrix that has the internal strategic factors listed in the first row; Strengths
and Weaknesses. It has the external strategic factors listed in the second row; Opportunities and Threats.
This SWOT strategic framework allows company managers to easily view all of the company’s strengths,
weaknesses, opportunities and threats in one matrix.
The SWOT analysis matrix helps in the development of 4 types of strategies by managers. These are:
 Strengths-Opportunities Strategies (SO): This involves using internal strengths to take advantage
of opportunities.
 Weaknesses-Opportunities Strategies (WO): This involves improving on the company’s
weaknesses by making use of the opportunities.
 Strengths-Threats Strategies (ST): This involves the using of strengths to minimize the weaknesses.
 Weaknesses-Threats Strategies (WT): This involves the elimination of weaknesses to combat the
threats.
The main objective of the SWOT analysis is to help in identifying the strategies that can be used by the
company to build on its strengths, eliminate its weaknesses while making the most of opportunities and
countering threats.
39

SWOT Analysis of Metro Cash and Carry
Strengths of Metro Cash and Carry
 Distribution and Reach: Metro Cash and Carry has a large number of outlets in almost every state,
supported by a strong distribution network that makes sure that its products are available easily to
a large number of customers in a timely manner.
 Cost Structure: Metro Cash and Carry’s low cost structure helps it produce at a low cost and sell
its products at a low price, making it affordable for its customers.
 Dealer Community: Metro Cash and Carry has a strong relationship with its dealers that not only
provide them with supplies but also focus on promoting the company's products and training.
 Financial Position: Metro Cash and Carry has a strong financial position with consecutive profits
in the past 5 years, along with accumulated profit reserves that can be used to finance future
capital expenditures.
 Metro Cash and Carry has a large asset base, which provides it with better solvency.
 Return on Capital Expenditure: Metro Cash and Carry has been successfully able to generate
positive returns on the capital expenditure it has incurred on various projects in the past.
 Automation: of various stages of production has allowed the more efficient use of resources and
reducing costs. It also allows for consistency in quality of its products and provides the ability to
scale up and scale down production as per the demand in the market.
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 Skilled Labor force: Metro Cash and Carry has invested extensively in the training of its
employees that has resulted in it employing a large number of skilled and motivated employees.
 Metro Cash and Carry has a diversified workforce, with people of many geographical, racial,
cultural and educational backgrounds that help the company by bringing in diverse ideas and
methodologies of doing things.
 Metro Cash and Carry has qualified and accredited professionals working under in its team.
 Entering new markets: Metro Cash and Carry’s innovative teams have allowed it to come up with
new products and enter new markets. It has been successful in past, in most of the initiatives it has
taken in new markets.
 Social Media: Metro Cash and Carry has a strong presence on social media with more than
millions of followers on the three most famous social media platforms: Facebook, Twitter and
Instagram. It has high levels of customer engagement on these platforms with low customer
response time.
 Website: Metro Cash and Carry has a well-functioning and interactive website that draws a large
number of internet traffic and sales.
 Product Portfolio: Metro Cash and Carry has a large product portfolio where it provides products
in a large range of categories. It has a number of unique product offerings that are not provided by
competitors.
 The geography and location of Metro Cash and Carry provide it with a cost advantage in serving
its customers, when compared to that with the competition.
 Metro Cash and Carry has a well-established IT system that ensures efficiency in its internal and
external operations.
 Metro Cash and Carry owns a number of intellectual property rights that include trademarks and
patents. These allow it exclusivity over its products and competitors cannot copy or reverse
engineer them.
 Metro Cash and Carry is a brand that has been in the market for years, and people are aware of it.
This makes its brand awareness high.
 Its products have maintained quality over the years and are still valued by customers, who find it
as good value for the amount of money that they pay.
 Partnerships: Strategic partnerships are established by Metro Cash and Carry with its suppliers,
dealers, retailers and other stakeholders. This allows it to leverage them if need be in the future.
41

Weaknesses of Metro Cash and Carry
 Research and Development: Even though Metro Cash and Carry is spending more than the
average research and development expenditure within the industry, it is spending way less than a
few players within the industry that have had a significant advantage as a result of their
innovative products.
 High Day Sales Inventory: The time it takes for products to be purchased and sold are higher than
the industry average, meaning that Metro Cash and Carry builds up on inventory adding
unnecessary costs to the business.
 Rented Property: A significant proportion of the property that Metro Cash and Carry owns is
rented rather than purchased. It has to pay large amounts of rent on these adding to its costs.
 Low current ratio: The current ratio that shows the company’s ability to meet its short term
financial obligations, is lower than the industry average. This could mean that the company could
have liquidity problems in the future.
 The company has low levels of current assets compared to current liabilities, and this can create
liquidity problems for it in operations.
 Cash flow problems: There is a lack of proper financial planning at Metro Cash and Carry
regarding cash flows, leading to certain circumstances where there isn’t enough cash flow as
required leading to unnecessary unplanned borrowing.
 Integration: Metro Cash and Carry's current structure and culture have resulted in the failure of
various mergers aimed at vertical integration.
 Diversification in the workforce: The workforce at Metro Cash and Carry is concentrated with
mostly local workers, and low amounts of workers from other racial backgrounds. Lack of
diversification makes it difficult for employees from different racial background to adjust at the
workplace, leading to loss of talent.
 Market Research: Metro Cash and Carry has not conducted market research within the market
that is serves since the past 2 years. As a result, it is making decisions based on 2 years old data,
while customer needs may have evolved over time.
 High employee turnover rates: Metro Cash and Carry has a higher employee turnover rate
compared to competitors. This means that it has more people leaving the job, and as a result, it is
spending
more on training and development as employees keep leaving and joining.
42

 Quality Control: Metro Cash and Carry has a lower budget for its quality control department than
competitors. This leads to lack of consistency and the possibility of damage to quality across its
various outlets.
 Lack of legal experience and legal department employees are not highly qualified.
 A few products have a high market share, while most of the products have a low market share. This
reliance on a few products makes Metro Cash and Carry vulnerable to external threats if these few
products suffer for any reason.
 The workload is a high per worker as there are fewer workers than the actual work required. This
puts workers under psychological stress and is likely to be less productive.
 Worker morale is low due to company culture and politics that have grown in recent years.
 Competition and qualified employees have been leaving the organisation in recent years, which
could mean a shortage of good talent for the company in the upcoming years.
 The decision making is highly centralized, and decisions by teams need to be approved by certain
officials. This reduces efficiency in operations by making them more time consuming. It also
leads to reduced innovation.
 The performance appraisal is not in a systematic manner. People are often not appraised for their
performance. This leads to lower work morale and lack of promotion opportunities for employees.
Opportunities of Metro Cash and Carry
 Internet: there has been an increase in the number of internet users all over the world. This means
that there is an opportunity for Metro Cash and Carry to expand their presence online; by using the
internet to interact with its customers.
 E-commerce: There has been a new trend and a growth in sales of the e-commerce industry. This
means that a lot of people are now making purchases online. Metro Cash and Carry can earn
revenue by opening online stores and making sales through these.
 Social Media: there has been an increase in the number of social media users worldwide. The
three social media platforms; Facebook, Twitter and Instagram, have shown the greatest number
of increase in monthly active users. Metro Cash and Carry can use social media to promote its
products, interact with customers and collect feedback from them.
 Technological developments: technology comes with numerous benefits among many
departments. Operations can be automated to reduce costs. Technology enables better data to be
collected on customers and improves on marketing efforts.
43

 There has been an increase in average household income along with an increase in consumer
spending following the recession. This will result in growth in Metro Cash and Carry’s target
market with new customers that can be attracted towards the business.
 Population: the population has been growing and is expected to grow at a positive rate for the
upcoming years. This is beneficial for Metro Cash and Carry as there will be an increase in the
number of potential customers that it can target.
 Inflation: The inflation rate has been low and is expected to remain low in the next two years.
This is an opportunity for Metro Cash and Carry as its cost of inputs would remain low for the
next two years.
 Interest rate: Lower interest rates than compared to previous years provides an opportunity for
Metro Cash and Carry to undergo expansion projects that are financed with loans at a cheaper
interest rate.
 Green government drive: this provides an opportunity for Metro Cash and Carry for the sale of
Metro Cash and Carry's products to federal and state government contractors.
 Transport Industry: the transport industry has been flourishing in the past few years, and shows
growth potential in the future. This has reduced the costs of transportation, which is beneficial for
Metro Cash and Carry as it will lower its overall costs.
 Tax policy: the governments’ reduction in tax rate is beneficial for Metro Cash and Carry as a
lower amount would be expensed out as a tax.
 The government has also announced a subsidy on the sale of environmentally friendly goods in
this sector. Metro Cash and Carry can focus on these environmentally friendly products and make
use of this opportunity.
 Tourism: growth in tourism is beneficial for Metro Cash and Carry as it will provide new potential
customers that it can target in order to gain market share.
 Skilled workers: increase in education and training by numerous institutes has increased the
amount of skilled labor available within the country. This means that if Metro Cash and Carry is
able to hire skilled labor, it would have to spend less on training and development, therefore,
saving costs.
 The growth in consumer spending in the economy is likely to increase consumption for Metro
Cash and Carry's products.
44

 A number of new niche markets have opened up that are growing. Metro Cash and Carry can sell
products in these markets and take advantage.
 Globalization: Increased globalization does not restrict Metro Cash and Carry to its own country.
It can extend its operations to other countries, entering into these markets and making use of the
opportunities that lie in these markets.
 Consumers within the industry are becoming more conscious of health, and this is a segment that
is growing. Metro Cash and Carry can take advantage by manufacturing products that are
beneficial to customer's health.
 Trade barriers have been reduced on the import of goods. This will reduce the costs incurred on
inputs for production.
 Regulations have loosened in recent years making it easier for businesses to carry out their
operations.
Threats of Metro Cash and Carry
 Technological developments by competitors; New technological developments by a few

competitors within the industry pose a threat to Metro Cash and Carry as customer attracted to this
new technology can be lost to competitors, decreasing Metro Cash and Carry’s overall market
share.
 Suppliers: The bargaining power of suppliers has increased over the years with the decrease in the
number of suppliers. This means that the costs of inputs could increase for Metro Cash and Carry.
 New entrants: there have been numerous players that have entered the market and are gaining
market share by gaining existing companies’ market share. This is a threat to Metro Cash and
Carry as it can lose its customers to these new entrants.
 Increasing competition: there has been an increase in competition within the industry putting
downward pressure on prices. This could lead to reduced revenue for Metro Cash and Carry if it
adjusts to the price changes, or loss of market share if it doesn’t.
 Exchange Rate: the exchange rate keeps fluctuating and this affects a company like Metro Cash
and Carry that has sales internationally, while its suppliers are local.
 Political uncertainties in the country prove to be a barrier in business, hindering performance at
times and making the business incur unnecessary costs.
 The fluctuating interest rates in the country do not provide a stable financial and economic
environment.
45

 Consumer tastes are changing, and this puts pressure on companies to constantly change their
products to meet the needs of these customers.
 Regulations on international trade keep changing, and this requires compliance by companies if
they are to operate globally.
 Substitute products available are also increasing, which is threat collectively for the whole
industry as consumption of current products decrease.
 The rise in prices of fuel has increased in the input costs for Metro Cash and Carry. These costs
have also increased as other industries that provide inputs for this company also have suffered
from increasing fuel prices, thereby charging more.
 Increased promotions by competitors have been a threat for Metro Cash and Carry. On most
media, there is more clutter than ever, and customers are bombarded with multiple messages. This
reduces the effectiveness of promotional messages by Metro Cash and Carry.
 Constant technological developments require the workforce to be trained accordingly as the
inability to keep up with these changes can lead to loss of business for Metro Cash and Carry.
Limitations of the SWOT Analysis of Metro Cash and Carry

Even though the SWOT analysis is an effective tool, it has certain limitations as well.
 Its major limitation is the fact that there can be an overlap of strengths and weakness, with a
single factor being both a strength and a weakness. For example, a large number of outlets can be
a strength in a growing economy or a weakness if the economy is going through a recession.
 The matrix is not an end as it does not show how to achieve the objectives. It should be used as a
starting point to make strategic decisions.
 The assessment done through a SWOT analysis is a static one and does not take into
consideration the changes that take place in the competitive environment.
 The factors listed down in a SWOT analysis may be overemphasized by the company.
46

 There are certain interrelationships between the internal and external factors that the SWOT
Matrix overlooks.
Weighted SWOT analysis of Metro Cash and Carry

In response to the above mentioned limitations, a weighted SWOT analysis can be conducted for Metro
Cash and Carry that involves assigning weightage to each of the strengths and weaknesses mentioned in
the SWOT analysis for Metro Cash and Carry. It also involves estimating the probability of an event
occurring in the external environment. This allows managers to focus on the important factors, and give
less consideration to the less important ones.
The limitation of the weighted SWOT analysis is that it does not look at how holistically different factors
affect the business when combined.
Example of weighted SWOT analysis

For Metro Cash and Carry, the strength for strong distribution can be given a higher weight than the
strength for the skilled labor force.
Advanced SWOT analysis/SWOT Matrix

Metro Cash and Carry SWOT analysis lists down the strengths, weaknesses, opportunities and threats to
any organization, but does not tell management what can be done by these. To overcome this limitation
and help develop strategies that are appropriate, an advanced SWOT analysis or TOWS matrix is used.
This lists down the Strengths-Opportunities (SO) strategies that involve using strengths to take advantage
of opportunities. It lists the Strengths-Threats (ST) strategies that involve using strengths to fight of
threats. It involves the Weaknesses-Opportunities strategies that involve converting weaknesses to
strengths by using opportunities. Lastly, Weakness-Threats (WT) strategies involve overcoming
weaknesses to avoid threats.
47

CHAPTER-3
RESEARCH DESIGN /
METHODOLOGY
48

Needs and significance of study
The scope of Working capital present study on compose with in its fold s theoretical frame
work of the working capital. In general analysis of working capital trends relationship of
working capital sales, liquidity of working capital
, analysis of management of components of working capital and the management of working
capital finance in the select unit the period covered by the under five years
Statement of the problem
 Levels of current assets will change quickly with the variation in sale
 The working capital of a firm will have a greater impact of the
profitability
Objectives of the study

 To the sources and uses of the working capital
 To study the liquidity position through various working capital related ration
 To make suggestion based on findings of the study
 To study the various factor affecting working capital requirements of the company
 To analysis relative assets liquidity and relative finance liquidity
49

Scope of the study
Current studies require an overview of farms first in capital management. The most important
part of the working capital is cash creditor, the account, debtor, lending agency and market
guarantee that can be paid, and market guarantees are important for research and main efforts
toknow the strength of the bank's bank.
After research, the size of the research is performed. The main research area is actually studied in
reality theoretical methods and actually been studied. Work capital studies are based on the same
equipment such as current assets, relationship analysis, short-term obligations and operating
capital operators. The study is then based on the last five-year annual report on Abhay Steel.
Limitation of the study
• Online sculptures via the COVID-19 collection of the correct data.
• You can discover the prejudice of employed staff.
• Intensive graphs for IT workers can be difficult to information.
• Mental management factors are not consistent and depends on the situation.
REVIEW OF LITRETURE
1. Review of Addis (2015), and is determined by the government, the kinds of critical
thinking and asset partition contains an amazing oversight that biopsy administration. It
contains the meaning of the addictive process, invention, it inspires people and society after
50

missionary society
It needed to Austin (2021) and Incrström (2022) of important technical skills foremployees in
the workplace. Key tasks for the representatives are encouraged toparticipate in the identifier
and to agree on issues of their interest. Since the coreof this activity should endeavour to
ensure the indicators represent a considerableeffort.
2. Bannerji noticed and Krishnan's (2015), the server is essential for making amoral
solution combines moral action. Administrators set up a social atmosphere and affects the
ethical work environment. Pioneer sports, business and activities as well as the Association
Agreement, it is important to understand its impact on society.
3 Arrer Benson and Stickel (2015) to the question, colleagues and directors do not
negatively interfere with the association agreement within the group. It can be a problem to
disappear emphasis will be sold to the available light because colleagues, meeting colleagues,
not the same way. The full association with one group profitability affects them.
4. Berl, Williamson and Powell (2017), self-help and when, as well as a limited
amount of time for this oil that is required for common tasks associated with work-related
managers and customers as part of the need for salary, safety, friends, research the goal is to
encourage the theory. Investigating the company is known, it focused on enterprises. You
have to use oiltheory to investigate the structure of inspiration, needs and reward employees.
4. Dirks and Perrin (2018) on the review of the deposition of staff to achieve the
objectives pioneer society because of positive associations. Representative of the obligation to
achieve thisgoal, for example, integrity, innovation and society of the restoration of an
atmosphere of honest workers, and leading representatives of enthusiasm on the ground,
including convictions Level of perfection Association activities, costs and message to the
manager trusted in society that affect how the achievement of project costs
5. Frauenheim (2020). It is the case of Hierarchical innovation to ensure that the possibility
of achieving their goals, they need to provide guidance to the structure of society and the
value
51

of positive conditions administrator.
6. HACKMAN Oldham (2021) to their questions, they will evaluate the five todo the job,
including two kinds of model elements in the demand. Work in progress and components are
specified. Various parameters of identity.
7. Kleinman (2021) added to the appropriate performance of their questions Published

Clearly representatives who are fulfilled react emphatically to procedures from the two styles
8. Lewicki & Wiethoff (2021), it knows the negative conditions at work, disappointment
at work, low temperature, conflicts and issues; Negative consequences bonds profession,
participation, exchange of data and the high performance of critical thinking When someone
in a way that will meet the results to see an assessment of the activities in their area of
specialization
9. LOCKE (2022), will be processed operating activities slave fought activity fulfilment
is cultivated when one sees estimation of the activity in a manner that has a results that is
satisfying.

McKinsey 7s
HARD ELEMENTS SOFT ELEMENTS

Strategy Shared values
Structure Skills
Systems Staff
Styles
53
HARD
ELEMENTS
The hard elements of the McKinsey 7s model comprise of strategy,
structure, and systems. The hard elements of the model are easier to identify, more tangible in nature,
and directly controlled and influenced by the leadership and management of the organization.
1. Strategy:
Clearly defined
The strategic direction and the overall business strategy for Metro Cash and Carry are clearly
defined and communicated to all the employees and stakeholders. This helps the organization manage
performance, guide actions, and devise different tactics that are aligned with the business strategy.
Moreover, the business strategy’s definition and communication also make operations for Metro Cash
and Carry more transparent and aligns the responsibilities and actions of the company.
Guiding behaviors for goal attainment

The strategic direction for Metro Cash and Carry is also important in helping the business guide
employee, staff, and stakeholder behavior towards the attainment and achievement of goals. SMART
Goals are set with short and long term deadlines in accordance with the business strategy. The
business strategy helps employees decide tactics and behaviors for attaining the set goals and targets
to help the business grow.
Competitive pressures
Metro Cash and Carry’s strategy also takes into consideration the competitive pressuresand
activities of competitors. The strategy addresses these competitive pressures through suggestive
measures and actions to address competition via strategic tactics and activities that ensure
sustainability to Metro Cash and Carry via adapting to market changes, and evolving consumer trends
and demands.
Changing consumer demands

An important aspect of the strategy at Metro Cash and Carry is that it takes into constant
consideration the changing consumer trends and demands, as well as the evolving consumer market
patterns and consumption behavior. This is an important part of the strategic direction at Metro Cash
and Carry as it allows the company to remain competitive and relevant to its target consumer groups,
as well as allows the company.
Flexibility and adaptability

The strategy at Metro Cash and Carry is flexible and adaptable. This is an important aspect of the
54

strategic direction, and strategy setting at Metro Cash and Carry. Rigidity in strategy leads a company
and a business to often become stagnant and obstructs advancement, and progression with evolving
changes in the consumer markets.
With flexibility and adaptability, the Metro Cash and Carry is not only able to benefit from quickly
reacting and responding to changing consumer patterns globally, but is also able to locally and
culturally adapt its products via localization for different countries and regions. Moreover, the
company is often able to proactively predict consumer market changes, and devise strategic changes
accordingly to meetthe market trends.
55

2. Structure:
Organizational hierarchy
Metro Cash and Carry has a flatter organizational hierarchy that is supported by learning and
progressive organizations. With lesser managerial levels in between and more access to the senior
management and leadership, the employees feel more secure and confident and also have higher
accessto information. Moreover, the flatter hierarchy also allows quicker decision-making processes
for Metro Cash and Carry and increases organizational commitment in the employees.
Inter-Departmental coordination
Metro Cash and Carry has high coordination between different departments. The company’s
departments often form inter-department teams for projects and tasks that require multiple expertise.
All coordination between different departments is effective and organized. Metro Cash and Carry has
a systematic process for initiating and monitoring coordination between departments to ensure smooth
work operations and processes – and goal attainment.
Internal team dynamics [department specific]

Metro Cash and Carry encourages teamwork and team-oriented tasks. Where jobs require
individual attention and scope, the company also assigns individual responsibilities and job tasks.
However, all employees at Metro Cash and Carry are expected to be team players who can work
well with and through other members, and who get along well with other people. The teams at Metro
Cash and Carry are supportive of all embers and work in synch with synergy towards achieving the
broader team objectives and goals under the Metro Cash and Carry designed strategy and values.
56

Centralization vs decentralization
Metro Cash and Carry has a hybrid structure between centralization and decentralization. Like
many progressive organizations, Metro Cash and Carry largely supports decentralized decision
making. Job roles at Metro Cash and Carry are designed to be carried out with responsibility, and
employees often set their goals with mutual coordination and understanding with the supervisors.
However, Metro Cash and Carry is also centralized in making sure that supervisors oversee, and
approve of the various efforts, and tactics that employees choose to ensure that they are aligned with
theorganizational strategy ad values.
Communication
Metro Cash and Carry has a developed and intricate system for ensuring communication
betweenemployees, and different managerial levels. The communication systems at Metro Cash and
Carry enhance the overall organizational structure. The systematic, defined, and organized
communication allows an easy flow of information and ensures that no organizational tasks and goals
are compromisedbecause of a lack of communication, or misunderstandings.
2. Systems:
Organizational systems in place

Metro Cash and Carry has defined and well-demarcated systems in place to ensure that the business
operations are managed effectively and that there are no conflicts or disputes. The systems at Metro
Cash and Carry are largely departmental in nature, and include, for example:
- Human resource management
- Finance
- Marketing
- Operations
- Sales
- Supply chain management
- Public Relation Management
57

- Strategic leadership
Defined controls for systems

Each of the defined and demarcated systems at Metro Cash and Carry has especially designed
tools and methods as controls for evaluating performance and goal attainment. These controls and
measures are designed specifically in different departments based on the nature of their tasks and
responsibilities. Moreover, each department also designs specific controls for members for performance
evaluation, as well as for inter- departmental tasks and responsibilities.
Monitoring and evaluating controls

Metro Cash and Carry continually evaluates its systems through the designed controls. This
monitoring of the performance is continual and ongoing. This is largely done through observation and
informal discussions. Feedback to employees and overall department heads is informally given
regularly as and when is required. Formal evaluation of performance is also conducted semiannually –
or quarterly, depending on the need and the urgency of the projects and assigned tasks. This is a
formal process that is undertaken by supervisors and managers to ensure the identification of
performance lags,and suggestive means of improvement.
Internal processes for organizational alignment

Metro Cash and Carry also has special processes and methods for ensuring that all departments
and systems within the organization are aligned and working in harmony towards the greater business
goals and targets. This is made possible through ensuring that all systems are designing and working
towards goals and targets specific to their expertise under the broader business vision and strategy.
Moreover, the strategic leadership at Metro Cash and Carry also ensures that all systems are allocated
with resources, and set specific targets to achieve similar business goals in any specific period.
SOFT ELEMENTS
The soft elements of the McKinsey 7s model, in turn, include shared

values, staff, skills, and strategy. These elements are less tangible in nature and are more influenced
by the organizational culture. As such, the management does not have direct influence or control over
them. These elements are also harder to describe and directly identify – but are equally important for
an organization’s success and improved performance.
1. Shared values:
Core values
The core values at Metro Cash and Carry are defined and communicated to foster a creative and
supportive organizational structure that will allow employees to perform optimally, and enhance them
58

motivation and organizational commitment. The core values at Metro Cash and Carry include, but are
not limited to:
- Creativity
- Honesty
- Transparency
- Accountability
- Trust
- Quality
- Heritage
The Metro Cash and Carry business also ensures that all its activities and operations are conducted
with high ethical and moral standards that redefined and benchmarked against international criteria.
Corporate culture
Metro Cash and Carry encourages an inclusive culture that celebrates diversity. The company has
an international presence, and production units that are spread across different countries, as such, Metro
Cash and Carry ensure that its organizational culture
is supportive of diversity, and has internal policies to reduce incidences of discrimination.
The corporate culture at Metro Cash and Carry also encourages innovation and creativity by allowing
independence for growth to individuals and teams –thus helping them refine their careers as well as
personalities. Lastly, the corporate culture at Metro Cash and Carry also has a supportive leadership
which works towards increasing employee motivation and job satisfaction by giving way to visibility
and accessibility.
Task alignment with values

Metro Cash and Carry ensures that all its job tasks and roles are aligned with the core values that
the company propagates. This means that all activities, tactics, and strategic tactics employed by
Metro Cash and Carry will reflect its core values, and will not deviate away from these. This is to
ensure a consistent, and reliable brand image, as well as an honest organizational culture. In the event
of organizational change, the company will continue to ensure that all change management processes
andmethods incorporate the core values so that the organizational culture is consistently maintained,
and systematically changed if need be.
59

2. Style:
Management/leadership style
Metro Cash and Carry has a participative leadership style. Through a participative leadership
style, Metro Cash and Carry is able to engage and involve its employees in decision-making processes
and managerial decisions. This also allows the leadership toregularly interact with the employees and
different managerial groups to identify any potential conflicts for resolution, as well as for feedback
regarding strategic tactics and operations.
Through its participative leadership, Metro Cash and Carry is able to enhanceemployee
motivation, and increase organizational commitment and ownership amongst employees as well as
other stakeholders.
Effectiveness of leadership style

The participative leadership style is highly effective in achieving the business goals and vision of
the organization. Employees feel to be active members of the organization who
are valued for their suggestions, feedback, and input. Moreover, through participative leadership,
leaders and managers are able to identify current and potential conflicts
within the Metro Cash and Carry organization, and actively work to resolve them as soon as possible.
Cooperation vs competition – internally

With its supportive and encouraging organizational culture, Metro Cash and Carry gives way to
internal collaboration and cooperation between employees, systems, teams, and departments. This
cooperation and collaboration at Metro Cash and Carry is important since its operations are spread
globally, and also because tasks and responsibilities within the company often require inter-
departmentalfeedback and input. Moreover, with increased expansion, and synergy, the business also
regularly forms project teams – which function effectively because of the cooperative and
collaborative culture withinthe Metro Cash and Carry organization.
Team vs groups
Metro Cash and Carry has effective and functional teams and works with them internally to achieve
its various business goals and objectives, and complete tasks. The company’s management is
encouraging and supportive, and the leadership provides a motivating and pragmatic vision toad
achieve. The humanresource management system, as well as the organizational training, supports all
employees in their growth fairly and transparently. This leads to effective team formation instead of
nominal groups within
60

the organization for various projects, as well as department-specific tasks and roles.
3. Staff:
Employee skill level vs business goals

Metro Cash and Carry has a sufficient number of employees employed across its global
operations.Employees for different job roles and positions are hired internally as well as externally –
depending on the urgency and the skill levels required. Based on this, it is seen that Metro Cash and
Carry has employees who are skilled as per the requirements of their job roles and positions. All
employees are given in house training to familiarize themselves with the company and its values.
External training along with in-house training is provided for skill level enhancement.
All job roles and positions are designed to facilitate the achievement of business goals,
and as such, employee skill level at Metro Cash and Carry is sufficient to achieve the business goals of
the company.
Number of employees
Metro Cash and Carry has employed a large number of employees. The number of employees
varies from country to country as per the requirements and needs of the business and operations. The
global team of Metro Cash and Carry is an inclusive one that accepts, and encourages diversity, and
works in synchronization with members to ensure attainment of business goals. The team member
sand employees are the most important part of business success for Metro Cash and Carry.
Gaps in required capabilities and capacities

Metro Cash and Carry has a well-defined system for identifying potential needs of capabilities
and capacities for the organization. The human resource function of the business has a systematic
process that aligns all other departments to identify potential vacancies or skill gaps. Based on the
nature of the need, the human resource department arranges for recruitments which may be
permanent or contractualin nature, as well as arranges training sessions if need be for the current
workforce.
4. Skills:
Employee skills
Metro Cash and Carry has a commendable workforce, with high skills and capacities. All
employees are recruited based on their merit and qualifications. Metro Cash and Carry prides itself on
hiring the best professionals and grooming them further to facilitate growth and development.
61

Employee skills vs task requirements
Metro Cash and Carry has defined tasks and job roles and hires and trains employees forskill
levels accordingly with respect to those. The company ensures that all its job requirements are met
and that employees have the sufficient skills to perform their respective jobs in accordance with the
values and culture as well as the business goals and strategy of Metro Cash and Carry.
Skill management
Metro Cash and Carry pays particular attention to enhancing the skills and capacities of its
employees. It arranges regular training and workshops – internally as well as externally managed- to
provide growth and development opportunities for its employees. Metro Cash and Carry focuses on
personal as well as professional growth for its employees and works accordingly with them.
Company’s competitive advantage

The human resource is one of the core competitive advantages of the company. The skills of
employees are developed specifically for job roles and requirements at Metro Cash and Carry and
provide a competitive benefit to the company – where players cannot imitate employee skills or
training. This creates a unique and non-substitutable competency for Metro Cash and Carry.
OBJECTIVES
1. Investigate the source and use of labour capital.
2.Logically, check the liquidity through different driving capital.
3.Increase the components of the driving capital, with bonds, cash management. Suggestion
4. Research Assess the management of driving capital in balance between analysis
andfluidity and profitability
5.Relative fluidity and liquidity of financial assets

6. Comparative analysis Evaluate the relative importance of other sources of funds
for drivingfunds.
62

HYPOTHESIS
1. explain observed events in a systematic manner
2. predict the outcome of event and relationship
3.systametically summarized of events and
relationshipH0.
1. Capital equipment does not help the business concern in maintaining of goodwill
2.working capital does create the environment of security confidence and overall efficiency in
the business.
H1.
1. working capital help creates the business concern in maintaining of goodwill

2. working capital creates an environment of security confidence and over all efficiency in
thebusiness
Research design
This study is a description character and uses a method of inspecting "Focus"
Data source
Basic data, that is, respondents, were collected by respondents. Dealers and Agency
Buyer (30) Dealer (RAI), India (RAI), CII and FICCI, including CII and FICCI, and 30%
information collected from the industry. In addition, the secondary data can be retrieved from
the government, government Karnataka, and the Indian There from the bank (RBI) and
finance.
Retail Includes the number of limited retailers, which is rather lifestyle, depending on the
drinking method or legal possibility, and the right sample. Cash Handling Subway, Bangalore's
three years of business, applying a minimum effect on business, and chosen a dealer such as 30
researchers. The criteria are best suited for this study, according to researchers. The important
thing is that for those who have been selected for the study of related research, as well as their
representatives in general population units. Therefore, the element of the sample is ensured. The
sampling probability of the plan sets the warranty.
Agency buyer: A little deadline and atmospheric studies, focus or legal testability is based on
the number of limitations near the place used in accordance with this method. He chosen the
use of small effects on the business, such as the standard, the buyer (30), such as the buyer
(30), subway cash and transportation, Bangalore for three years. The criteria are best suited
for this study, according to researchers. It is important to be the relevance of functionality and
research units for the name of the name of the name.

63

Therefore, the element of the sample is ensured. The sampling probability of the plan sets the
warranty.
Data collection tools.

This plan is specifically designed for this purpose, and was introduced to responder data
data.
Plan data processing and analysis

Depending on the formation of Ho and F1, the statistics unit used for test non- smoked links
between the corresponding characters and high quality collections.
Research Restriction
Sometimes it continues to respond with the help of data results in the basic subject
discussion. Importantly influenced by their judgment, there may be some subjectivity.
Researchers are best for this study. The important thing is that it is a choice and characteristics to
study the entire representation of their relevance
population. Therefore, the element of the sample is ensured. The sampling probability of the
plan sets the warranty.
Data collection tools.

This plan is specifically designed for this purpose, and was introduced to responder data
data.
Plan data processing and analysis

The statistical unit uses the object of non-smoked between these symbols based on the
formationof HO and H1
Research Restriction
Sometimes it continues to respond with the help of data results in the basic subject
discussion. Importantly influenced by their judgment, there may become subjectivity.
Data source
Quantitative data
Another key set for useful CRM is quantified to calculate measurable points. This allows
64

customers to view the number of purchases, which interacts with Customer Service, or a
specific product of the site multiple times.
This information is essential for customers to determine where the buyer's journey follows. It is
also very useful to implement customers to customers, not an important part of the brand
community rather than other databases.
 Do online surveys
 This website and articles are included.
 articles
Sources of Date
Primary Date Secondary date
Basic Information
The default data is the first related information. These are specifically unique data sets for
this purpose. Actually, the basic data that only has a fairly confident confidence was not yet
released. The default data is more efficacy than the secondary data because the primary data has
not changed or treated. Those who collected basic data can be a state of the main agency,
researchers, auditors, or Exchange buffers. Using the questionnaire and interview methods to
collect default data in my research.
Secondary data
The secondary data is related to the information already collected and can be used in other
sources. When we combine statistics with the basic data of other sources to achieve our goals.
65

Auxiliary data - we call it. Recycled data is called additional data. These data are less than FC data
and are costly and easy.
Literature, Industrial Research, Database, and Information Systems and Computer Models
or Mathematical Processes are a good place to retrieve secondary data.
population
Samples were taken by the subway cash and portable design selection Development
of Security Used Samples
Probably the same simple sampling close to the hand, the segment of the population is not taken
from the segment. Despite this study, test, scientifically identified conclusion, it is an accessible
and convenient because itis a selected election population
Those who collected basic data can be a state of the main agency, researchers, auditors, or
Exchange buffers. Using the questionnaire and interview methods to collect default data in my
research.
66

Size of sample:
Data acquisition equipment
 Data Help Form was collected in Google.
 Data was analyzed by SPSS
67

CHAPTER-4
FRAMEWORK AND
ANALYSIS
68

NET WORKING CAPITAL RATIO
Net working capital can be positive or negative. A positive net capital will arisewhen
current assets exceeds current liabilities over current assets.
TABLE SHOWING NET WORKING CAPITAL
TABLE N0. 4.1

Years Current assets current liabilities Net working capital
2016 400441.7 490189.60 89748.13
2018 344327.48 435744.61 91417.13
2019 383859.00 509696.39 125837.39

2020 240310.44 390344.27 150033.83
2021 250335.18 381471.82 131136.64
ANALYSIS
Net working capital can be positive or negative. A positive net capital will arisewhen
current assets exceeds current liabilities over current assets. There is fluctuations in Current
liabilities and Current assets.
69

GRAPH SHOWING NET WORKING CAPITAL
GRAPH NO. 4.1
NET WORKING CAPITAL

160000
140000
120000
100000
80000
60000
40000
20000
0 1 2 3 4 5
INTERPRETATION
The net working capital of 2017=89748.13, The net working capital of 2018=
91417.13, The net working capital of 2019= 125837.39, The net working capital of 2020= 150033.83,
The networking capital 0f 2021= 13113.
WORKING CAPITAL TURNOVER
The ratio weather investment is not current assets has been properly utilized. it determines
how efficiently the company is in converting raw materials tofinished goods
70

TABLE SHOWING WORKING CAPITAL TURNOVER
TABLE NO. 4.2
years Net sales Working capital Capital turnover
2017 209966.16 89748.13 2.33

2018 91596.16 91417.13 1.00
2019 84326.01 125837.39 0.67

2020 70872.17 150033.83 0.47
2021 57433.13 13113.64 0.43
ANALYSIS
The ratio weather investment is not current assets has been properly utilized . itdetermines
how efficiently the company is in converting raw materials tofinished goods.
GRAPH SHOWING WORKING CAPITAL

TURNOVER GRAPH NO. 4.2
WORKING CAPITAL TURNOVER

2.5
1.5
71

0.5
0
1 2 3 4 5
INTERPRETATION
Working capital turnover ratio is fluctuating year by year. Capital turnover is fluctuating year by year.
In 2019 it was 0.67 times in 2020 it was 0.47. in 2021it was 0.43 and it was decreasing because net
sales are decreased year by year.
STOCK WORKING CAPITAL RATIO

Stock to working capital ratio is a liquidity. it is used to measure the short termsolvency
of the company .is also help to find the out ratio of over stockingand under stocking of the
company.
TABLE SHOWING STOCK WORKING
CAPITAL TABLE NO. 4.3
Years Inventory Working capital Stock to

working capital
2017 11788.72 89748.13 0.13
2018 11261.71 91417.13 0.12
2019 10490.71 125837.39 0.08
2020 9620.56 150033.83 0.06
2021 9334.28 131136.64 0.07
ANALYSIS
72

Stock to working capital ratio is a liquidity. its is used to measure the short termsolvency of the
company .is also help to find the out ratio of over stockingand under stocking of the company.
STOCK TO WORKING CAPITAL

0.14
0.12
GRAPH
0.1
SHOWING
0.08 STOCK
0.06
WORKING
CAPITAL
0.04 TURNOVER
0.02
GRAPH NO.
0 4.3
1 2 3 4 5
INTERPRETATION
Stock to working capital ratio in 2017 was 0.13 in 2018 it was 0.12 In 2019 it was 0.08 in 2020 it was
0.06 2021 it was 0.07. in the stock turnover ratio for working capital is getting improving slowly
.data can be interpreted asin stock to working capital ratio was decreasing year by year and the firm
should work hard on stock to working capital to increasing profitability of the firm
CASH TO CURRENT ASSETS RATIO

cash to current assets ratio show the proportion of cash in the current assets
73

TABLE SHOWING CASH TO CURRENT ASSETS
TABLE NO. 4.4

years cash Current assets Cash to current
assets
2017 9369.24 40047.47 0.023
2018 2125.86 344327.48 0.006
2019 1687.43 383859.00 0.004
2020 3233.97 240310.44 0.013
2021 27122.47 250335.18 0.108
ANALYSIS
cash to current assets ratio show the proportion of cash in the current assets
GRAPH SHOWING CASH TO CURRENT

GRAPH NO. 4.4
CASH TO CURRENT ASSETS

0.12
0.1
0.08
0.06
0.04
0.02
0
1 2 3 4 5
INTERPRETATION
Cash to current ratio in 2016 was 0.023 in 2017 it was 0.006 in 2018 it was 0.004in 2019 it
74

was 0.013 and 2020 it was 0.108 the above table shows that increasingtrend to the proportion
of cash in current assets in satisfactory level. In the cash have been gradually increasing in all
the year but the current are deducting year by year.
INCOME TO TOTAL INCOME RATIO
the return on assets ratio often called the return on total assets is a profitability ratio
that measure the net income produced by the total assets during a period bycomparing net
income to the average total assets. in the other word the return onassets ratio ROA measures
how efficient a company can manage its assets to produce profit during a period.
TABLE SHOWING OTHER INCOME TO TOTAL

INCOME TABLE NO. 4.5
Year Other income Total income Other income to

total income
2016 7391.34 217357.60 3.40
2017 3302.54 94898.70 3.48
2018 3188.81 87514.82 3.64
2019 3706.7 74578.93 4.97
2020 8491.68 65924.82 12.8
ANALYSIS
The return on assets ratio often called the return on total assets is a profitability ratio
that measure the net income produced by the total assets during a period bycomparing net
income to the average total assets. in the other word the return onassets ratio ROA measures
how efficient a company can manage its assets to produce profit during a period
75

GRAPH NO. 4.5
OTHER INCOME TO TOTAL

14
12
10
1 2 3 4 5
INTERPRETATION
other income to total income in year 2016=3.40, other income to total income in year
2017=3.48, other income to total income in year 2018=3.64, other income to total income in year
2019=4.97, other income to total income in year 2020=12.8
ASSETS TURNOVER RATIO
The total assets turnover ratio measures the ability of a company to use its assets to
efficiently generate sales this ratio consider all assets current and fixed
TABLE SHOWING OTHER INCOME TO TOTAL

INCOME TABLE NO. 4.6
Year Net sales Total assets Assets turnover
ratio
2017 209966.26 8061189.99 0.26
2018 91596.6 723277.50 0.12
76

2019 84326.01 700761.82 0.12
2020 70872.17 508758.09 0.13
2021 57433.14 534063.74 0.10
ANALYSIS
The total assets turnover ratio measures the ability of a company to use its assets to
efficiently generate sales this ratio consider all assets current and fixed
77

OTHER INCOME TO TOTAL INCOME
14
12
10
1 2 3 4 5
GRAPH SHOWING OTHER INCOME TO TOTAL

INCOME GRAPH NO. 4.6
INTERPRETATION
other income to total income in year 2016=3.40, other income to total income in year
2017=3.48, other income to total income in year 2018=3.64, other income to total income in year
2019=4.97, other income to total income in year 2020=12.8

STEMENT OF CHANGE IN WORKING CAPITAL
PARTICULAR 2018 2019 INCREASE DECREASE

CURRENT
ASSETS
Inventories 11788.72 11261.91 526.81
Current 0.00 0.00 0.00
investment
Trade 347712.99 299783.45 47929.54
receivable
Cash and cash 9369.24 2125.86 7243.38
equivalent
Short term loan 31524.64 31032.15 492.49
and advances
Other current 45.88 124.11 78.23
assets
TOTAL (A) 400441.47 344327.48
CURRENT
LIABILITIES
Short term 34104.01 48299.53 14195.52
borrowing
Trade payable 261718.45 187757.00 73961.45
Short term 25273.27 28893.77 3620.5
provision
other current 69093.87 170794.31 1700.44
liabilities
TOTAL (B) 490189.6 435744.61
WORKING 89748.13 91417.13
CAPITAL (A-
B)
NET 1669 1669
DECREASE IN
WORKING
CAPITAL
91417.13 91417.13 81283.06 81283.06

STATEMENT OF CHANGE IN WORKING CAPITAL
PARTICULAR 2020 2021 INCREASE DECREASE

CURRENT
ASSETS
Inventories 11261.91 10490.71 771.2
Current 0.00 0.00 0.00 0.00
investment
Trade 299783.45 338758.72 38975.27
receivable
Cash and cash 2125.86 1687.43 438.43
equivalent
Short term loan 31032.15 32874.21 1842.06
and advances
Other current 124.11 47.93 76.18
assets
TOTAL (A) 344327.48 383859.00
CURRENT
LIABILITIES
Short term 48299.53 60582.17 12282.64
borrowing
Trade payable 187757.00 202428.67 14671.67
Short term 28893.77 32873.02 3979.25
provision
other current 170794.31 213812.53 43018.22
liabilities
TOTAL (B) 435744.61 509696.39 40817.33 75237.59
WORKING 91417.13 125837.39
CAPITAL (A- B)
NET INCREASE 34420.26 34420.26

IN WORKING
CAPITAL
125837.39 125837.39 75137.41 75137.41
80

CHAPTER-5
SUMMARY OF FINDINGS,
CONCLUSIONS AND
RECOMMENDATIONS
SFBS 8
FINDINGS
 Working capital of the metro cash and carrywas increasing and showing
positive working capital per tear its shows good position.
 Positive working capital indicates that company has ability of payment of short
term liabilities.
 Working capital has increased but the company should take care of their
current assets and current liabilities.
 Company current assets were always more than requirement it effects of their
profitability.
 Networking capital of the Metro cash and carry company Pvt ltd. Is increasing
year by year during the period of study and which is good for the company.
 Working capital is mostly financed by long term sources and marginally short
term sources.
 The liquidity ratio of the metro cash and carry company is satisfactory.
 The components of working capital as well as sales are showing fluctuating

trends.
SFBS 8
SUGGESTIONS
 Working capital has been increasing every year also increasing every year.
Profits also increases every year is a good it has to maintain it further to run the
business long term
 The company has sufficient working capital and has better liquidity by
efficient utilization this it should increases the turnover
 The metro cash and carry should take precautionary measure for current
assets and current liabilities from receivable from receivable and ti reducebad
debts
 The sufficient working capital and moderate liabilities by efficient utilization

this short term capital then it should increase the turnover
 The company is depending more on bank borrowings and long term sources of
funds for working capital needs.
 Inventory position of the company is satisfactory. If the company will

increase its stock of inventory, then it will more satisfactory in future
 Company should reduce its debtors and increase cash resources.
 The sales of the company are showing fluctuating trends. So the company
should maintain proper control on sales.
SFBS 8
CONCLUSION
1. The purpose of our project report on metro cash and carry was to help
toattain knowledge about the working patterns in an organization
2. The company’s liquidity position is good in the current year compared tothe
previous year
3. The company should mainly focus on its net worth
4. It is better for the organization to diversify the founds to different storesin

the present market scenario
5. I want to thank to HR Manager NAVIN KUMAR Sir and employees

MAMATHA and PREETHI for guiding and sharing information about
organization profile and detailed process of the company.
6. The cooperation is found to be very well organized, developed and most ideal
management in every walks of its Administration and management aspects.
7. Company should reduce its debtors and increase cash resources.
8. The sales of the company are shoeing fluctuating trends. So the company
should maintain proper control on sales.
SFBS 8
SECTION-III
BIBLIOGRAPHY
SFBS 8
The following books are mentioned: -
1 Working capital by N.K. Jain
2 Working capital Application and cases by James
3. Hrishikesh -Residence Educational Strategy and Technology
4. Thomas Littleton Financial Statement
5. Kmadhavi.2016. PAPERMILL Working CAPITAL. International research

magazine in management.
6. Amit, K., Mallik, D. S. and Currace 2015. Capital Works & Profitability: A Study
on the Relationships in Relational Companies in India Pharmaceutical Industry.
Guitar was smiled.
7.B Bazsi and B khamrui.22. Relationship between working capital and profitability:
studies FMCG companies in India. Company and Finance.
8. ABDUL RAKHIMAN and MOHAMED NARREEE.2020. Capital management

and profitability are a Pakistan company. International Business Survey Review.
9. www.ibes.org/industry/steel.aspx.
10.It is also related to the basic website and Wikipedia (information only)
11. All information collected in the study is that the company's massive,
company’s balance sheet, business exploration and deterioration
12. D., & VASU, M. (1998). Promote your organization's trust in North Carolina:
The most important role of administrators and political leaders. Administrative and
Society, 30 (1), 62-63. Can be used in appropriate papers and databases.
(UM196925569)
SFBS 8

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(A STUDY ON WORKING CAPITAL IN METROCASH AND CARRY)

Project Report submitted in Partial fulfillment of the requirement for

Place: Bangalore Mr. ABHISHEIK NAIK B

[Type here ] [Type here ] [Type here ]

This is to certify that Mr. ABHISHEIK NAIK B bearing Register no:

This is to certify that the dissertation report titled “A STUDY ON WORKING

his hard work and sincere effort.

Place: Project guides

METRO CASH AND CARRY

TO WHOM IT MAY CONCERN

This is to certify that Mr. ABHISHEIK NAIK B a student of St Francis de Sales

I am grateful to my guide Prof (D Prabha and Mahima Agrawal), City

Name of the Student-ABHISHEIK NAIK B

Sl. No Reports particulars Page

Executive summery 1-2

3. Research Design /methodology 48-66

4. Framework and Analysis 67-79

5. Summary of Findings, Conclusion and Recommendations 79-84

1 NET WORKING CAPITAL RATIO 68-69

2 WORKING CAPITAL TURNOVER RATIO 69-70

3 STOCK WORKING CAPITAL RATIO 70-71

4 CASH TO CURRENT WORKING RATIO 71-72

5 INCOME TO TOTAL INCOME RATIO 72-76

1.1 INTRODUCTION ABOUT FINANCE

ST. FRANCIS DE SALES

ST. FRANCIS DE SALES

ST. FRANCIS DE SALES

ST. FRANCIS DE SALES

Proper utilization of finance

1.1.5 SCOPE OF FINANCE MANAGEMENT

ST. FRANCIS DE SALES

1.1.6 FINANCE FUNCTIONS:

Managerial finance functions

1.1.7 AIMS OF FINANCE FUNCTION

ST. FRANCIS DE SALES

1.1.8 ABOUT THE TOPIC

ST. FRANCIS DE SALES

ST. FRANCIS DE SALES

1.2.5 MEANING OF OPTIMAL CAPITAL STRUCTURE

ST. FRANCIS DE SALES

ST. FRANCIS DE SALES

 Capital structure helps to reduce the overall risk of company

ST. FRANCIS DE SALES

ST. FRANCIS DE SALES

1. 2 8 FACTORS AFFECTING CAPITAL STRUCTURE

ST. FRANCIS DE SALES

1.2 10 ADVANTAGES OF CAPITAL STRUCTURE

ST. FRANCIS DE SALES

1.2.12 CAPITAL STRUCTURE THEORIES

1.2.13 VARIOUS CAPITAL STRUCTURE THEORIES

ST. FRANCIS DE SALES

2. Net Operating Income Approach:

ST. FRANCIS DE SALES

3 .The Traditional Approach:

ST. FRANCIS DE SALES

ST. FRANCIS DE SALES

ST. FRANCIS DE SALES

4. Modigliani- Miller hypothesis:

ST. FRANCIS DE SALES

ST. FRANCIS DE SALES

ST. FRANCIS DE SALES

2.3 IMPORTANCE OF A GOOD LITERATURE REVIEW