VISHVESHWARAYA TECHNOLOGICAL UNIVERSITY

Jnana Sangama , Belagavi - 590 014

ORGANIZATION STUDY REPORT

BAMUL

In partial fulfilment of internship study requirements of

Master of Business Administration

Submitted by

DARSHITHA N

USN: 1DT21BA009

Under the Guidance of

Dr. Sahana Madan

Professor & Head Dept. of MBA, DSATM

DAYANANDA SAGAR ACADAMY OF TECHNOLOGY AND MANAGEMENT

DEPARTMENT OF MASTER OF BUSINESS ADMINISTRATION

Kanakapura Road, Udayapura Bengaluru- 560082

2021 – 23

1
 DECLARATION

I , DARSHITHA N a student of Masters of business

Administration bearing Register No. 1DT21BAOO9 of DAYANANDA
SAGAR ACADEMY OF TECHNOLOGY AND MANAGEMENT hereby
declare that I own full responsibility for the information , results and
conclusion provided in this project work titled “AN ORGANIZATION
STUDY AT BAMUL” submitted to Vishveshwaraya Technological
University , Belgavi for the award of degree of Master of Business
Administration .

To the best of my knowledge , this project work has not been

submitted in part or full elsewhere in any other institution for the
award of any certificate. I have completely taken care in
acknowledging the contribution of others in this academic work . I
further declare that in case of any violation of intellectual property
rights and particulars declared, found at any stage , I as the
candidate will be solely responsible for the same.

DATE:

PLACE: BANGALORE

SIGNATURE OF THE CANDIDATE

DARSHITHA N
(1DT21BA009)

2
 ACKNOWLEDGEMENT

We would like to express our gratitude to Mr. SRINIVAS ,

GENERAL MANAGER , BAMUL for sparing their precious time and
giving required organizational information . without their guidance
and help , this project would have not been completed in such
faithful way.

We also indebted to Mrs. SAHANA MADAN , Our internal

faculty guide in putting together all the bits and pieces I bought in a
raw data to her.

Our special thanks to our parents , who so lovingly and

unselfishly cared for them , have had the understanding and of
course to bear with us when we was all too busy with the project.

3
 CONTENTS

CHAPTER CHAPTER NAME PAGE

NUMBER NUMBER
DECLARATION 2

ACKNOWLEDGEMENT 3

SUMMARY 8

1. INTRODUCTION 9

1.1 UNDERSTANDING THE INDUSTRY 10

2. ORGANIZATION PROFILE 11

2.1 BACKGROUND 13

2.2 OBJECTIVE 14

2.3 VISSION AND MISSION 15

2.4 WORKFLOW MODEL 17

2.5 PRODUCT PROFILE 17-21

2.6 OWNERSHIP PATTERN 22

2.7 ACHIVEMENTS/ AWARDS 22

2.8 FUTURE GROWTH AND PROSPECTS 23

4
3. McKENSY’s 7s FRAMEWORK &PORTER’S 24
FIVE FORCE MODEL
3.1 McKENSY’s 7S FRAMEWORK 24

3.2 PORTER’S FIVE FORCE MODEL 27

4. SWOT ANALYSIS 30

5. ANALYSIS OF FINANCIAL STATEMENTS 33

5.1 MEANING 33

5.2 COMPARATIVE BALANCE SHEET 34

5.3 FINANCIAL PERFORMANCE BASED ON 37

RATIO ANALYSIS
5.4 RATIO ANALYSIS 38

5.5 DEBTORS TURNOVER RATIO 39

5.6 NET PROFIT RATIO 40

5.7 STOCK TURNOVER RATIO 41

5.8 CURRENT RATIO 43

5.9 QUICK RATIO 44

6. FINDINGS 47

7. SOME OF THE PICTURES CLICKED IN THE 48

COMPANY
8. CONCLUSION 49

5
 9. BIBILOGRAPHY 50

LIST OF TABLES :

2.3 VISION & MISSION TABLE 16

5.2 COMPARATIVE BALANCE SHEET 34-36

5.5 DEBTORS TURNOVER RATIO 40

5.6 NET PROFIT RATIO 40

5.7 STOCK TURNOVER RATIO 42

5.8 CURRENT RATIO 43

5.9 QUICK RATIO 45

LIST OF FIGURES :

1. INTRODUCTION 9

1.1 UNDERSTANDING THE INDUSTRY 12

2.5 PRODUCT PROFILE 17-21

6
3.1 McKINSEY’s 7S MODEL 24

3.2 PORTERS FIVE FORCE MODEL 27

4 SWOT ANALYSIS 30

5.5 PIE CHART(Debtors turnover 39

ratio)
5.6 PIE CHART (Net profit ratio) 41

5.6 PIE CHART ( Stock turnover ratio) 42

5.7 PIE CHART (Current ratio) 44

5.8 PIE CHART ( Quick ratio) 46

7
 SUMMARY

The MBA course offered by VTU , Belgavi has own unique syllabus
which requires its MBA students to undertake an internship with any
industry for the period of 4 weeks. This study was introduced by the
university for the students to gain practical knowledge about the work
and functioning of the organization.

This study is conducted on “BAMUL” . The main objective of the

internship is to expose the students to understand the working culture
of the organization and apply theoretical concepts in real life
situation at the work place for various functions for the organization.

For preparing the report we need to study the profiles of the

industry and the organizational profile . organizational profile includes
the background of the company, nature of the business and
companies vision and mission statements, quality policy of the
organization and the product and services profile of the organization.
And this report includes the ownership pattern , future growth and
prospectus.

The study was more emphasized on Mckensy’s 7S framework , porter’s five

force model and the SWOT Analysis of the company. The study provides a good
exposure and a good comparision of the practical and theoretical aspects as
studied in the course.

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 CHAPTER 01

INTRODUCTION
Industries are a part of secondary activities. Secondary Activities or
manufacturing converts raw materials into products of more value
to people. BAMUL is an industry awarded 2nd place for achievement
in energy Conservation in Dairy sector . It is the second largest dairy
co-operative amongst the dairy co-operatives in the country.

The industrial visit to BAMUL offered an opportunity to explore

the technical aspects of dairy production and marketing . This
industrial visit complemented theoretical knowledge with practical
experience and exposure. It enlightened us on the aspects of
procuring, pasteurizing , preserving, packing and distribution of milk
and milk products.

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 1.1 UNDERSTANDING THE INDUSTRY

BAMUL
Bangalore milk union limited is the biggest co-operative milk union in
south India. It was established during 1975 under operation Flood 11
by keeping“AMUL” as its role model. Is fully owned and managed by
milk producers of Bangalore rural and Bangalore urban districts of
Karnataka state. BAMUL enjoys a very strong “customer base” in
their domestic market . Milk is highly perishable product hence the
area covered is very less and the market is small compared to other
non-perishable products . BAMUL is also organising consumer
awareness program as a part of market development to create
awareness of “NANDINI” milk through personal contacts. BAMUL is
the No.1 milk dairy in India . It has unique features such as no profit
no loss motive , and it acts as mediator between farmers and the
public .

10
11
 CHAPTER 02

ORGANIZATIONAL PROFILE

India is the highest milk producer in the entire globe . India is well
known as the ‘Oyster’ of the global dairy industry , with
opportunities galore to the entrepreneurs globally. It might be
dream for any ration in the world to capitalise on the largest and
fastest growing milk and milk products market. The dairy industry in
India has been witnessing rapid growth. The liberalised economy
provides more opportunities for MNCs and foreign investors to
release the full potential of this industry.

The main aim of the Indian diary industry is only to better manage
the national resources to enhance milk production and upgrade milk
processing using innovative technologies. Multinational dairy giant
can also make their foray in the Indian dairy market in this
challenging scenario and create a win-win situation for both.

In India, dairying has Benn practiced as rural cottage industry since

remote past. Semi- commercial dairying started with the
establishment of military dairy farms and co-operative milk unions
throughout the country towards the end of the nineteenth century.

During the early years, each household in those countries maintained

its family cow or secured milk from neighbour who supplied those
living close by. As the urban population increased , fewer household
could keep a cow for private use. The high cost of milk production ,
problems of sanitation etc., restricted the practice ; gradually the
family cow in the city was eliminated and city cattle were all sent
back to the rural areas.

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The Indian dairy industry has made rapid progress since
Independence . A large number of modern milk plants and product
factories have since been established. These organised diaries have
been successfully engaged in the routine commercial production of
pasteurised bottle milk and various western dairy products.

2.1 BACK GROUND

The NDDB was found to replace exploitation with empowerment,

tradition with modernity , stagnation with growth , transferring dairy
into instrument for the development of India’s rural people.

The NDDB was established in 1965; the board is registered under

the societies registration Act and the public trust Act, fulfilling the
desire of prime minister of India the late Lal Bahaddur Shastri to
extent the success of the kiara co-operative milk producers union
(AMUL) to other parts of India. The success combined the wisdom &
energy of farmers with professional management to success
combined the wisdom & energy of farmers with professional
management to successful capture liquid milk and milk product
markets while supporting farmer’s investment with inputs and
services.

In 1969 , when the government of India approved the operation

flood program and its financing through the monetisation of world
food Program- gifted commodities , it was found that the status
under which NDDB was registered did not provide for handling of
government funds. Therefore, in 1970 government established a
public sector company , the Indian dairy corporation. The IDC was
given responsibility for receiving the projects donated commodities;
testing their quality; their storage and transfer to user diaries and
receiving the diary payments. Thus it served as finance -cum-

13
promotion entity while the entire operation flood technical support
was provided by NDDB . To avoid any duplication their activities or
overlap of functions, the IDC and NDDB were eventually merged in to
a newly constituted NDDB by an act of parliament passed in October
1987 .

2.2 OBJECTIVE

1. To provide quality milk and milk products to urban consumers

at competitive prices.

2. To facilitate rural development by providing opportunities for

self employment at village level , thereby preventing migration
to urban areas. Introducing cash economy & opportunity for
steady income.

3. To provide technical input services like veterinary services ,

artificial insemination , supply of balanced cattle feed & fodder
seed materials to milk producers.

4. To provide assured market and remuneration price for milk

producers by the farmer members of the co-operative
societies.

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 5. To organize dairy co-operatives societies at village level and
dissemination of information like good dairy animal husbandry
and breeding practices & clean milk Production through
Extension Services .

2.3 VISSION AND MISSION

To eliminate middlemen and organise institution owned and

managed by the milk producers , by employing the professionals.
Achieving economies of scale of rural milk producers by ensuring
max returns and at same time providing the wholesome milk at
reasonable price to urban consumers. Therefore the margin between
the procurement prices selling prices is the lowest in the country . In
recognition to its work national productivity council of India has
conferred ‘BEST PRODUCTIVITY AWARD ‘ 5 times.

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PROCUREMENT AND AMP INPUT
Total societies 2084
PROCUREMENT AND INPUT
Inhabited villages 4250
Milk producers members 349187
Milk procurement routes + BMC routes 129 + 33
PROCESSING PLANTS CAPACITY PROCUREMENT PER DAY (IN
LAKHS)
Bangalore dairy 9.00
Hosakote diary 2.00
Byrapatna chilling centre 0.60
Doddaballapur chilling centre 1.00
Anekal chilling centre 0.60
Solur chilling centre LPD 1.00
Vijayapura chilling centre 1.00
Kanakapura chilling centre 0.60
Bulk milk coolers 3.60
MARKETING AND SALES
Retailers 1833
Franchisee outlets 81
Milk parlors 41

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2.4 WORKFLOW MODEL

A workflow model is the sequential series of tasks and decisions that

make up a business process. Designing a workflow model lets
business users see how a process works and helps them streamline
and optimize it for best results and high quality.

2.5 PRODUCT PROFILE

Types of milk and milk products marketing by BAMUL

1.NANDINI TONED MILK:

Karnataka’s most favourite milk , Nandini toned milk . Fresh and pure
milk containing 3.0% fat and 8.5% SNF available in 250ml , 500ml ,
1ltr , & 6ltr packs. Better to use within a day from the date of packing
.

2. NANDINI HOMOGENIZED COW MILK:

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Nandini homogenised Toned Milk is pure milk containing 3.5% Fat
and 8.5% SNF . It is homogenised and pasteurised . It gives you
more cups of tea or coffee and coffee is easily digestible . Available
in 500ml packs.

3. NANDINI SHUBHAM MILK:

Nandini Shubham Milk is fresh pure consisting of 4.5% and 8.5%

SNF. A rich creamier and tastier milk ideal for Home made sweet and
savouries . Available in 500ml & 1litre.

4. NANDINI CURD:

Nandini curd made from a pure milk . Its thick and delicious giving
you all the goodness of homemade available in 200g , 500g and 1kg
pack curds.

5.NANDINI SET CURD:

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Real thick curds made from homogenised milk with superior quality
culture. It is thick and delicious , giving all goodness of homogenised
curds available in 200g , and 400g cups.

6.PEDA:

No matter what you are celebrating is made from pure milk ,

Nandini Peda is a delicious treat for the family . Store at room
temperature approximately 7 days . Available in 250gms pack
containing 10 pieces each.

7.MYSORE PAK:

Karnataka’s traditional sweet made from pure ghee available in 250g

and 500g pack. Store at room temperature approximately 7 days.

8. BUTTER:

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Rich smooth and delicious . Nandini butter is made out of fresh
pasteurised cream . Rich taste, smooth texture and the rich purity of
cow’s milk , makes any preparation a delicious treat. Available in
100gms ,200gms, and 500gms carton box both salted and unsalted.

9. FLAVOURED MILK:

Badam flavoured milk available in 200ml sachets. Better to use

within a day from the date of packing.

10. BUTTER MILK:

Nandini spiced Butter Milk is a refreshing health drink. It is made

from quality curds and is blended with fresh green chilies , green
coriander leaves , asafoetida and fresh ginger . Nandini spiced butter
milk promotes health and easy digestion. It is available in 200ml
packs , and is priced at most competitive rates, so that it is affordable
to all section people.

11. PANEER:

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Tasty, wholesome and nutrition’s supplement for a variety of dishes
and mouth watering. Available in 2300g and 1kg packs can be stored
for 30 days when frozen.

12. KHOVA:

Khova is prepared from fresh and pure milk . It is supplied on the

indent order base.

13. CREAM:

Cream is prepared from fresh and pure milk . It is supplied on the

indent order base.

2.6 OWNERSHIP PATTERN

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BAMUL is an organization of local , family farmers from across the
Bangalore urban , rural and Ramanagara district , which means that
they are owned by the family farmers that they passionately serve .
Divided into three geographic areas , the grassroots structure
ensures every member is represented through elected farmer
leaders at all level of cooperative governance . This grassroots
structure is overseen by a 18- member board of directors.

2.7 ACHIEVEMENTS / AWARDS

1. Bureau of energy efficiency , Govt. of India conferred BAMUL has

been awarded second place for the achievement in energy
conservation for the year 2005vin dairy sector .

2. Karnataka safety council , Karnataka Govt. conferred BAMUL has

been awarded 1st place in best safety Industrial Boiler award for
Boiler maintenance in the year 2007

3. Karnataka renewable energy Development Ltd Govt of Karnataka

conferred BAMUL has been awarded second place for
acheivement in energy conservation for the year 2008-09 in Dairy
sector.

4. The union is certified for Food Safety Management System , ISO

22000:2005 by M/s Standards Australia International Global ,
Mumbai .

5. BAMUL has been certified for ISO 22000:2005 & 9001-2000 for
quality management and food safety systems. The national
productivity council (NPC) of government of India has conferred
“Best Productivity Award “ for FIVE TIMES.

22
2.7 FUTURE GROWTH AND PROSPECTS

They want to become not only the largest un ion but also become
one amongst the best run milk unions in the country . The union is
aware of the challenges of the new private entrants , who are mainly
thriving on unfair trade practices. They produce milk at least cost ,
without bothering about the welfare of the producers and without
extending any technical inputs for improving milk production. They
market milk by restoring to unhealthy and unethical practices
deceiving the unsuspecting consumers . The union wants to counter
this in a positive manner by trying to improver its efficiency of
operation and market promotion . It wants to become well trenched
in the market as market leader . It wants to follow the strategy of
cost- compitativeness , which is hard to manage by the competitors.

23
 CHAPTER 03

McKENSY’s 7S FRAMEWORK AND PORTERS FIVE

FORCE MODEL

3.1 Mckinsey’s 7S Model

Let's look at each of the elements specifically:

Strategy : the plan devised to maintain and build competitive

advantage over the competition.

Structure : the way the organization is structured and who reports

to whom.

Systems : the daily activities and procedures that staff members

engage in to get the job done.

Shared Values : called "superordinate goals" when the model was

first developed, these are the core values of the company that are
evidenced in the corporate culture and the general work ethic.

Style : the style of leadership adopted.

Staff : the employees and their general capabilities.

Skills : the actual skills and competencies of the employees

working for the company.

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1.Shared Value : It means the central belief and attitudes of the
organization. The core values of the organization is as follow
a. Leadership
b. Responsive and Fairness
c. Credibility
Employees have to work using these values and employees are
evaluated on these basis.

1. Strategy : It means the plans to reach the target audience and

plans advised to maintain and build competitive advantage. The
strategies are used by the organization are as follows.
a. Protect and penetrate
b. Data driven
c. Extend and diversity

1.Structure :Top level managers are act as facilitators of the

resources to the team of employees motivate them to accomplish
organization goal with achieving personal goal.

25
2. Systems : It means the procedures, processes and routine that
characterizes how important work is to be done. Organization has
fixing a target of work to every team which has to be performed by
the employees in the supervision of the team leader. Performance
appraisal is done through self-appraisal and then team managers
will rate their subordinates and totally it is done according to the
level of hierarchy.

3. Staff : top level the age of employees are more than 45 years.

4. Style :Employees have to report to their team manager about

their work and solve their problems by discussing with the group.

5. Skill: Employees who is working in the organization has

following skills
a. Leadership
b. Programming

Training and Development:

At BAMUL, training and development is an ongoing process. The

workers are trained to operate machines, reduce scrap and avoid
accidents whereas the supervisors, managers and executives are
provided training which will enable them to grow and acquire
maturity of thought and action. The training and development
efforts at BAMUL are designed to help the employees satisfy their
personal goals – through higher level of skills and competencies;
facilitate higher contribution at their present jobs and to prepare
them for the next level of the organization. The employees who are
deployed for training are considered to be on duty and they get the
TA and DA as per the rules of BAMUL.
Normally the training programs conducted at BAMUL are:
1. Workshop on good quality Ghee.

26
2. Computer Basics.
3. ISO Quality System Awareness Programme.
4. Workshop on Sale Tax.
5. Quality Audit Programme.
6. Marketing management.
7. Materials management.
8. Workshop on First aid.
9. Reclair Grades for Milk Packaging Application and Food Laws.
10. Total Energy Management Programme.
11 . Marketing and Brand Management.
12. Improving sales effectiveness.

3.2 PORTER’S FIVE FORCE MODEL

THREATS OF NEW ENTRANTS:

1. Increase of competitors milk vendor in organised sector.

2. Flexibility in commission structure by competitors may attract
the distributors .
3. No entry barriers for private players.

27
4.low level of consumer awareness in Bangalore and surrounding
areas.
5. The competition from co-operatives like Dodla , heritage,
Kamadenu , they are producing different milk products which are
giving a good competition to the MYMUL etc.

COMPETATIVE RIVALRY:

Competative rivalry is a measure of the extent of competition

among existing firms. Intense rivalry can limit profits and lead to
competitive moves , including price cutting , increased advertising
expenditures , or spending on service / product improvements and
innovation.

BARGAINING POWERS OF CUSTOMERS:

The bargaining powers of buyers , one of the forces in porters five

force Industry Analysis framework , refers to the pressure that
customers/ consumers can put on businesses to get them to
provide higher quality products, better customer service , and /or
lower prices.

BARGAINING POWER OF SUPPLIERS:

The bargaining power of Suppliers , one of the forces in Porter’s

Five Force Industry Analysis Framework , is the mirror image of the
bargaining power of buyers and refers to the pressure that
suppliers can put on companies by raising their prices , lowering
their quality , or reducing the availability of their products.

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THREAT OF SUBSTITUTE PRODUCTS:

The threat of substitute is high when rivals , or companies outside

the industry , offer more attractive and / or lower cost products.
Buyers then have the opportunity to make a performance / price
trade-off . the cost of switching is also a factor. If it is high , the
threat of substitute is low.

29
 CHAPTER 04
SWOT ANALYSIS

SWOT ANALYSIS:

SWOT Analysis is an auditing of an organization and its

environment. It is the analysis of the Strength, Weakness,
Opportunities, and Challenges of the organization. Strength
and weakness are internal, while opportunity and threats
are external to the company.

30
Strengths of BAMUL:

• Stronger customer base and Market leader with

brand equity(Captured almost 70% of the market share
in the domestic market, with the Competitive and
Wide product range)
• Strong supplies base.
• Largest milk union in southern India.
• Automated computerized plant.
• An ISS, HACCP, EMS certified company.
• Winner of “Best productivity Award” by National
productivity council for five times and "Energy
conservation Award” by Bureau of Energy Efficiency.
• Well organized distribution channel.

Weakness of BAMUL:
• Slow decision making process.
• Less advertisement.
• External interference from state federation.
• Inflexible traditional Government structure.
• Lack of professionals in core management areas

Opportunities of BAMUL:

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• Expanding market for milk and milk products.
• Increased farmer income by expanding the high demand.
• Existing brand “Nandini” can be used to expand its
product line. Need not to invest on brand awareness.
• The existing infrastructure can be used to meet the
considerable rise in demand in future with kittle
change.

Challenges facing by BAMUL:

• Competitors of BAMUL have started to access the

supplier base by offering more prices.
• Significant increase in the feed prices.
• Very attractive commission for agents from rivals.

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 CHAPTER 05
FINANCIAL ANALYSIS OF BAMUL

5.1MEANING

Financial statement analysis is the process of analysing a company's

financial statements for decision-making purposes. External
stakeholders use it to understand the overall health of an
organization as well as to evaluate financial performance and
business value. Internal constituents use it as a monitoring tool for
managing the finances. Analysis of financial statements is the process
of evaluation of the performance of a company in the financial year
and then deciding about the corrective actions that need to be
taken.

Objectives of Financial Statement Analysis –

• To provide the information to the external as well as

internal stakeholders of the company.
• To know the financial position of the company.
• To evaluate the overall performance of the company .
• To make a basis for decision making.

33
 5.2Comparative Balance Sheet

Comparative Balance Sheet as on ending of the year for five

consecutive years starting from 2016 to 2021

SI PARTICULARS 2019-20 2018-19 2017-18

NO.
1. LIABILITIES
Sources of fund

Paid-up capital 746300000 645919000 572692000

Nominal members 227500 210500 188800
Share suspense 2585063 2562501 2546193
Capital grants 4060665848 92307578 77048952
Reserves and 1397254252 4725524272 4007669594
surplus
Loan liability 2066173182 1529891257 657370604
Current liability 88250809 2458576018 2155844762
Profit & Loss 1647718699 256083064 186778849
TOTAL LIABILITIES 10284503669 9711074191 7660139754
2. ASSETS
Fixed Assets 6757582877 5632555736 2069927323
Work -in progress - 1210043532 2034402501
Investments 462493493 126513680 747212384
Inventory 152328143 1216538604 879602270
Sundry Debtors 518391083 50723930 412557825
Cash- bank balance 1475719092 523434548 430781101

34
Loans & advance 238726581 165235199 1085656350
Service Deposites 238726581 30996373 -
Others 679262401 298332589 -
TOTAL ASSETS 10284503669 9711074191 7660139754

35
SI PARTICULARS 2016-17 2015-16
NO.
1. LIABILITIES
Sources of Fund
Paid- up capital 453782000 406710000
Nominal members 157600 127710
Share suspense 2558793 2740614
Capital grants 17806005 -
Reserves and surplus 2947029659 1630497086
Loan liability 688467717 691725756
Current liability 2323406087 1022976824
Profit & loss 303148980 119528520
TOTAL LIABILITIES 6736356842 3874306510
2. ASSETS
Fixed Assets 1893043790 1615219674
Work – in – progress 405868925 130173921
Investments 1970074460 195622554
Inventory 874807257 1315879400
Sundry debtors 300985490 318370011
Cash- bank balance 747218981 54380077
Loans & Advances 350472602 189516287
Service deposites 24253405 23430668
Others 169631930 31713917
TOTAL ASSETS 6736356842 3874306510

TABLE1 : COMPARATIVE BALANCE SHEET

36
5.3 FINANCIAL PERFORMANCE BASED ON RATIO ANALYSIS:

Ratio analysis is referred to as the study or analysis of the line items

present in the financial statements of the company. It can be used to
check various factors of a business such as profitability, liquidity,
solvency and efficiency of the company or the business.
Ratio analysis is mainly performed by external analysts as financial
statements are the primary source of information for external
analysts.
The analysts very much rely on the current and past financial
statements in order to obtain important data for analysing financial
performance of the company. The data or information thus obtained
during the analysis is helpful in determining whether the financial
position of a company is improving or deteriorating.

NATURE OF RATIO ANALYSIS:

In financial analysis, ratio is used as an index of yardstick for evaluating

the financial position and performance of the firm. It is a technique of
analysis and interpretation of financial statements. Ratio analysis
helps in making decisions as it helps establishing relationship between
various ratios and interpret thereon. Ratio analysis helps analysts to
make quantitative judgement about the financial position and
performance of the firm. Ratio analysis involves following steps:

1. Relevant data selection from the financial statement related to the

objectives of the analysis.

2. Calculation of required ratios from the data and presenting them

either in pure ratio form or in percentage.

3. Comparison of derived different ratios with:

37
i. The ratio of the same concern over a period of years to know upward
or downward trend or static position to help in estimating the future,
ii. The ratios of another firm in same line, or
iii. The ratios of projected financial statements, or
iv. The ratios of industry average, or
v. The predetermined standards, or
vi. The ratios between the departments of the same concern assessing
either the financial position or the profitability or both.
4. Interpretation of the ratio:
Ratio analysis uses financial report and data and summarizes the key
relationship in order to appraise financial performance. The
effectiveness will be greatly improved when trends are identified,
comparative ratios are available and inter-related ratios are prepared.

5.4 RATIO ANALYSIS :

Ratio Analysis on Financial Statement and Income Statement.

1. Debt Equity Ratio
2. Net Profit Ratio
3. Stock turnover ratio
4. Current Ratio
5. Quick Ratio

5.5.Debtors turnover Ratio:

A concern may sell goods on cash as well as on credit is one of the

important elements of sales promotion . the volume of sales can be
increased by following a liberal credit policy . trade debtors are
expected to be converted into cash within a short period and are
included in current assets. Hence , the liquidity position of a concern
to pay its short term obligations in time depends upon the quality of
its trade debtors.

Debtor’s turnover ratio = net credit sales / Accounts receivable.

38
Table 5.5 : debtors turnover ratio calculation

YEARS NET CREDIT ACCOUNT DEBTOR’S

SALES RECEIVABLES TURNOVER RATIO
2015-2016 15612896529 318370011 49.040

2016-2017 19473012881 300985490 64.698

2017-2018 20797952158 412557825 50.412

2018-2019 24741621440 507423929 48.759

2019-2020 20866946529 518391083 40.253

Sales

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

INTREPRETATION:

Debtor’s velocity indicates the number of times the debtors are

turnover during a year. Generally , the higher the value of debtors
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turnover the most efficient is the management of debtors/ sales or
more liquid are the debtors . Similarly a low debtors turnover implies
inefficient management of debtors / sales and less liquid debtors .

There is increase in Debtors turnover ratio from 2015-16 to 2016-17

and there is continuous decrease from 2017-18 to 2019-20 .

5.6Net profit ratio :

It is the ratio of after- tax profits to net sales. We can find out overall
performance of a firm by this ratio as it is the left- out profit
after deducting all the costs of production, administration and
financing from sales. Here in the graph, we have shown it in the form
of trend line to compare the performance over a period.

Net profit ratio = net profit after tax / net sales * 100

Table 5.6 calculation of net profit ratio :

YEARS NET PROFIT NET SALES NET PROFIT

AFTER TAX RATIO
2015-2016 119528520 15612896529 0.765
2016-2017 303148980 19473012881 1.556
2017-2018 186778849 20797952158 0.898
2018-2019 256083065 20866946529 1.227
2019-2020 275328317 24741621440 1.112

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 Sales

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

INTREPRETATION :

The ratio is very useful as if the profit is not sufficient , the firm shall
not be able to achieve a satisfactory return on its investments. This
ratio also indicates the firm’s capacity to face the adverse economic
conditions such as price competition low demand . Obviously higher
the ratio the better is the profitability.

From the above pie chart we can see that when we compare to
2015-16 there is an increase in 2016-17 and again there is decrease
in 2017-18 but from 2018-19 there is an increase in the net profit
ratio .

5.7Stock turnover Ratio :

Inventory turnover ratio also known as stock velocity . it would

indicate whether inventory has been efficiently used or not . the
purpose is to see whether only the required minimum funds have
been locked up in inventory . Inventory turnover ratio indicates the
number of times the stock has been turned during the period and

41
evaluates the efficiency with which a firm is able to manage its
inventory.

Stock turnover ratio = Net sales / Inventory

Table 5.7 : calculation of stock turnover ratio

YEARS NET SALES INVENTORY STOCK TURNOVER

RATIO
2015-2016 15612896529 1315879400 11.845
2016-2017 19473012881 874807257 22.260
2017-2018 20797952158 879602270 23.645
2018-2019 20866946529 1216538604 17.153
2019-2020 24741621440 679262401 36.424

Sales

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

INTREPRETATION:

42
Inventory turnover / Stock turnover ratio measures the velocity of
conversion of stock into sales . From the above pie chart , it clearly
shows that there is a increase in stock turnover ratio from 2015-16 to
2017-18 . A high turnover ratio indicates efficient management of
inventory . But there is a decrease in the ratio in 2018-19 and again
there is a increase in 2019-20.

5.8 Current ratio :

The Current Ratio helps to know whether the assets a company holds
is enough to meet its obligations. There is the ideal ratio as 2:1 which
is considered as a healthy ratio a company should have. Current ratio
may be described as the relationship among current assets and
current liabilities. This ratio additionally referred to as working
capital ratio , is a degree of general liquidity and is maximum widely
used to make the analysis of short – term financial position or
liquidity of a firm.

Current ratio = current assets / current liabilities

Table 5.8 calculation of current ratio

YEARS CURRENT CURRENT CURRENT RATIO

ASSETS LIABILITIES
2015-2016 2912099156 1647718698 1.76
2016-2017 2741961243 8576018245 1.11
2017-2018 2808597546 2155844762 1.30
2018-2019 2467369666 2157756273 1.14
2019-2020 1933290360 1022976824 1.88

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 Sales

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

INTREPRETATION:

Higher the value of current ratio indicates more liquidity of the firm’s
ability to pay its current obligation in time. In the above pie chart we
can observe that in 2015-16 the ratio is 1.88 and in the next year
2016-17 current ratio decreases to 1.14 and in the year 2017-18
again it increases 1.30 and again it decreases in the year 2018-19 to
1.11 and it increases to 1.76 in the year 2019-20 . At the present the
company can pay its debts on time.

5.9 QUICK RATIO :

This is the ratio which decides upon the liquidity position of a

company. This is
calculated because to decide upon how much liquid assets a
company should have to meet its short- term needs.
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Quick ratio = Liquid assets / Liquid liabilities

Table 5.9 calculation of quick ratio

YEARS LIQUID ASSETS LIQUID QUICK RATIO

LIABILITIES
2015-2016 617410960 1022976824 0.603
2016-2017 1592562409 2157756273 0.738
2017-2018 1928995276 2155844760 0.894
2018-2019 1525422639 2458576018 0.620
2019-2020 10216577268 1647718699 6.200

Sales

2015-16 2016-17 2017-18 201-19 2019-20

45
INTREPRETATION :

Quick ratio is very useful in measuring the liquidity position of the

firm . It is used as a complementary ratio to the current ratio . From
2015-16 to 2017-18 there is a increase in quick ratio this shows that
the firm is maintaining liquidity to meet its liabilities .

There is slight low in the year 2018-19 of 0.620 and in the year 2019-
20 it is showing a high ratio of 6.200.

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 FINDINGS

Followings are the findings during the study :

1. BAMUL is serving the rural region and helping for their

upliftment , by way of procuring milk through poor farmers
through its formed societies and paying them fair returns. It is
contributing for economic upliftment of farmers.

2. BAMUL is even serving the society and its customer by

providing better quality milk and milk products.

3. BAMUL is earning profit year after year and it is not confronting

any financial problems.

4. BAMUL is equipped with fully automatic systems which ensures

total quality maintainance (functions)

5. It has got its own quality control department with fully

equipped laboratory and equipments that help detecting any
adultration or any such other defects.

6. Through the use of advanced technology , BAMUL provides its

customers bacteria free and balance nutrition milk (product
agumentation)

7. BAMUL provides training and education programs that creates

legal awareness about social and economic upliftment among
rural people , especially women.

8. The whole system is so equipped automatically , that more

hygiene is maintained in preparing the milk and milk products .

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SOME OF THE CLICKED PICTURES IN THE
COMPANY

48
 CONCLUSION

BAMUL is the no.1 milk diary in India. It has unique features such as
No Profit No Loss motive, it acts as mediator between farmers and
the public. It gives social commitment to farmers and sells its
products at convenient price for customers.

It was a great experience coming to Bangalore Diary and doing

my in plant here. I got an exposure of the corporative world. I got
a chance to compare our theory with the practicality.

By studying about the BAMUL organization I got to know how

the people work in the organization. It was a great experience
in BAMUL knowing how milk is processed and other products
and also how it is good for our health. I gained lot of knowledge.

It has its own quality control division with all quality control devices
and techniques which has helped it in maintaining its standard
quality .

Hence BAMUL is not only helping the rural society but is also catering
the urban region by providing its products to all ages supplying milk
to look and corner of Bangalore district.

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 BIBILOGRAPHY

1. www.bamul.com

2. www.google.com

3. Brochure

4. Company’s Profile

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