Hetero Drugs Project

PROJECT REPORT
ON
WORKING CAPITAL MANAGEMENT
OF
HETERO DRUGS LTD,ERRAGADDA, HYDERABAD.
Submitted in partial fulfillment of the requirement for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION

To the
SCHOOL OF MANAGEMENT STUDIES
JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY KUKATPALLY,
HYDERABAD.
By
M.RAKESH
H.T.NO:-10UK1E0017
At
VAAGDEVI ENGINEERING COLLEGE

BOLLIKUNTA, WARANGAL-506005.
(Affiliated to Jawaharlal Nehru Technological University Kukatpally, Hyderabad)
(2010 -2012)
BOLLIKUNTA- WARANGAL-506 005

(Affiliated to Jawaharlal Nehru Technological University, Kukatpally, Hyderabad)
Dr. M. JAGANMOHAN REDDY
M.Com. M. Phil., PhD
CO-ORDINATOR
CERTIFICATE
This is to certify that Mr. M. RAKESH, H.T.No: 10UK1E0017 is a bonafide student of

MBA in this college during the academic year 2010-2012. He has done the project work entitled
WORKING CAPITAL MANAGEMENT OF HETERO DRUGS LTD,ERRAGADDA,
HYDERABAD and completed the work in partial fulfillment of the requirement for the award
of MASTER OF BUSINESS ADMINISTRATION (M.B.A) course, as per the norms stipulated
by the
JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY, Kukatpally,
Hyderabad.
The work is original and has not been submitted for any other degree or diploma in part
or in full.
CO-ORDINATOR

BOLLIKUNTA, WARANGAL 506005
(Affiliated to Jawaharlal Nehru Technological University, Kukatpally, Hyderabad)
CERTIFICATE
This is to certify that the project entitled WORKING CAPITAL MANAGEMENT

OF HETERO DRUGS LTD, ERRAGADDA, HYDERABAD has been prepared by Mr. M.
RAKESH, H.T.No: 10UK1E0017 under my supervision. He has completed this project work as
per the rules prescribed by the JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY,
Hyderabad for the partial fulfillment of MASTER OF BUSINESS ADMINISTRATION. It is
a bonafide work done by him and has not been submitted either in part or full for any other
Degree or Diploma of any other University.
(Sri G. BHANU CHANDER)

PROJECT GUIDE
DECLARATION
I hereby declare that the Project entitled WORKING CAPITAL MANAGEMENT OF

HETERO DRUGS LTD, ERRAGADDA, HYDERABAD is a bonafide work done by me as a
part of requirement of MASTER OF BUSINESS ADMINISTATION (M.B.A) at VAAGDEVI
ENGINEERING COLLEGE affiliated to the JAWAHARLAL NEHRU TECHNOLOGICAL
UNIVERSITY, Hyderabad during the year 2010-2012.
I also declare that this is the original work done by me and no part of work has been
submitted either in part or full for any Degree or Diploma of any other university or institution.
(M. RAKESH)
H.T.NO.10UK1E0017
ACKNOWLEDGEMENTS
I take this opportunity to express my thanks to HETERO DRUGS LTD,

ERRAGADDA, HYDERABAD, who gave me this opportunity to carry out my project in their
organization.
I am very thankful to Manager, Sri K.MADHU KUMAR for his valuable guidance
and their constructive criticism, which were very helpful for the completion of the project work in
this organization.
I sincerely thank Dr. M. JAGANMOHAN REDDY, co-ordinator, VAAGDEVI
ENGINEERING COLLEGE, Bollikunta, Warangal, for giving support and encouragement
during my project work in an efficient manner.
I sincerely thank to the efforts of Sri G. BHANUCHANDER, faculty member of
Vaagdevi Engineering College, Bollikunta, Warangal, for guiding and supporting me in
completion of this project.
This project report is dedicated to my parents who are the source of support and
encouragement, in every aspect of my life, education and career.
M.RAKESH
H.T.NO.10UK1E0017
CONTENTS
S.NO
CHAPTER
Page No
INTRODUCTION
01-08
II
RESEARCH METHODOLOGY
09-13
III
COMPANY PROFILE
14-31
IV
DATA ANALYSIS AND INTERPRETATION
32-51
CONCLUSIONS AND SUGGESTIONS
52-53
BIBLIOGRAPHY
54
CHAPTER - I
INTRODUCTION
INTODUCTION
Every business needs funds for two purposes, for its establishment and to
carry outs its day-to-day operations. Long term funds are required to create
production facilities though purchase of fixed assets such as plants and machinery,
land, building, furniture, etc. investments in these assets represent that part of firms
capital which is blocked in a permanent or fixed basis funds are also needed for short-
term purposes for that purchase of raw marital, payment of wages and other day-today expenses, etc. these funds are known as working capital. In simple words,
working capital refers to that part of the firms capital which is required for financing
short term or current assets such as cash, marketable securities, debtor and
inventories.
In the words of SHUBIN, working capital is the amount of funds necessary
to cover the cost or operating the enterprise.
According to GENESTENBERG, circulating capital means current assets of a
company that are changed in the ordinary course of business from one form to
another form, as per example from cash to inventories, inventories to receivables,
receivables into cash.
In simple words, working capital refers to that part of the firms capital which
is required for financing short term or current assets such as cash, marketable
securities, debtors and inventories. Funds, thus, invested in current asst keep
revolving fast and are being constantly converted into cash and this cash flows out
again in exchange for other current assets. Hence, it is also known as revolving or
circulating capital or short term capital.
That working capital refer to that difference between current assets and
current liabilities, it is excess of current assets over current liabilities.
Working capital= current assets-current liabilities
Operating Cycle of Working Capital
It is clear that working capital is required because of the time gap between the
sales and their actual realization into cash. This time gap is technically called as
Operating cycle of the business.
In case of a manufacturing company the operating cycle is the length of time
necessary to complete the following cycle of events.
Conversion of cash into raw materials.
Conversion of raw material into work in progress.
Conversion of work in progress into finished goods.
Conversion of finished goods into accounts receivable, and
Conversion of account receivable into cash.

This cycle will be repeated again and again. The speed with which the
working capital
completes one cycle determines the requirements of working capital
Longer the period of the cycle larger is the requirement of working capital.
The operation cycle of manufacturing business can be shown as the following chart.
Accounts
Receivables
Cash
Finished
Goods
Raw
Materials
Work in
Progress
Need of working capital management

The need for working capital gross or current assets cannot be over emphasized. As
already observed, the objective of financial decision making is to maximize the
shareholders wealth. To achieve this, it is necessary to generate sufficient profits can be
earned will naturally depend upon the magnitude of the sales among other things but
sales cannot convert into cash. There is need for working capital in the form of current
assents to deal with the problem arising out of lack of immediate realization of cash
against goods sold. Therefore sufficient working capital is necessary to sustain activity.
Technically this is refers to operating or cash cycle. If the company has certain amount of
cash, it will require for purchasing the raw material may be available on credit basis.
Management of working capital
Guided by the above criteria, management will use a combination of policies
and techniques for the management of working capital. These policies aim at managing
the current assets (generally cash and cash equivalents, inventories and debtors) and the
short term financing, such that cash flows and returns are acceptable.
1. Cash management: cash management identify the cash balance which allows for the
business to meet day to day expenses, but reduces cash holding costs.
2. Inventory management: inventory management identifies the level of inventory
which allows for uninterrupted production but reduces thee investment in raw material
and minimized costs and hence increased cash flows.
3. Debtors management: debtors management identify the appropriate credit policy i.e.
credit terms which attract customers, such that any impact on cash flows and the cash
conversion cycle will be offset by increased revenue and hence Return on capital.
4. Short Term Financing: short term financing identify the appropriate source of
financing, given the cash conversion cycle.
CLASSIFICATION
Working capital may be classified in to two ways:
1. On the basis of concept
2. On the basis of time
ON THE BASIS OF CONCEPT
CONCEPT OF WORKING CAPITAL
There are two concepts of working capital management

1. Gross working capital
Gross working capital refers to the firms investment in current assets. Current
assts are the assets which can be convert into cash within year includes cash, short term
securities, debtors, bills receivable and inventory.
2. Net working capital
Net working capital to the difference between current assets and current
liabilities. Current liabilities are those claims of outsiders which are expected to mature
for payment within an accounting year and include creditors, bills payable and
outstanding expenses. Net working capital can be positive or negative efficient working
capital management required that firms should operate with some amount of net working
capital, the exact amount varying from firm to firm and depending, among other thins; on
the nature of industries, net working capital is necessary because the cash out flows and
inflows do not coincide. The cash out flows resulting from payment of current liabilities
are relatively predictable. The cash inflow are however difficult to predict. The more
predictable the cash inflows are the less net working capital will be required.
The concept of working capital was, first evolved by Karl Marx. Marx used
the term variable capital means outlays for payrolls advance to workers before the
completion or work. He compared this with constant capital which according to him in
nothing but dead labor. This variable capital is nothing wage fund which remains
blocked in terms of financial management, in working process along with the other
operating expenses until it is released through sale of finished goods although Marx did
not mentioned that workers also gave credit to the firm by accepting periodical payment
of wages which funded a portioned of W.I.P. the concept of working capital, as we
understand today was embedded in his variable capital.
ON THE BASIS OF TIME:
On the basis of concept working capital can be classified as gross working

capital and net working capital. On the basis of time, working capital may be classified
as:
1. Permanent working capital
Permanent or fixed working capital is minimum amount which is required to
ensure effective utilization of fixed facilities and for maintaining the circulation of
current assets. Every firm has to maintain a minimum level of raw material, work-inprocess, finished goods and cash balance. This minimum level of current assets is called
permanent or fixed working capital as this part of working is permanently blocked in
current assets. As the business grow the requirement of working capital also increase due
to increase in current assets.
2. Temporary working capital
Temporary or variable working capital is the amount of working capital which
as required to meet the seasonal demands and some special exigencies. Variable working
capital can further be classified as seasonal working capital and special working capital.
The capital required to meet the seasonal need of the enterprise is called seasonal
working capital. Special working capital is the part of working capital which is required
to meet special exigencies such as launching of extensive marketing of conducting
research, etc. temporary working capital differs from permanent working capital in the
sense that is required for short periods and cannot be permanently employed gainfully in
the business.
Objectives
The primary objective of working capital management is to ensure that
sufficient cash is available to:
1. Meet day to day cash flow needs.
2. Pay wages and salaries when they fall due
3. Pay creditors to ensure continued suppliers of goods and services
4. Pay government taxation and providers of capital dividends

5. Ensure the long term survival of the business entity.
It is critical to understand that profits is not cash. A company can be very
profitable but it can collapse simply because it has insufficient cash/liquidity to pay its
relevant bill (as stated above)
Always remember that any company liabilities are settled with cash and not by profit
Use of working capital
Working capital is the measure of a companys ability to pay off its short term
debt is the deference between current assets and current liabilities.
Working capital is used to finance the following:
Construction, renovation or improvements to the leasehold.
To but furniture, fixtures, machinery, or equipment.
To replenish inventory.
For day to day operations of a business and payroll (expect owners salary).
For down payment assistance on the purchase of real estate for the business.
Sources of working capital

There are typically five components of working capital that are important for a
small business to understand and monitor.
1. Cash and equivalents represent the most liquid form of working capital. Every
small business should understand the time dependency between cash inflow and
outflow, when peak cash is needed and the level of borrowing needed to meet
shortfalls of cash.
2. Accounts receivable represents the credit that the business extends to its
customers. Small businesses need to know the amount of accounts receivable
reasonable relative to sales, how rapidly are receivables being collected, and the
slow paying customers.
3. Inventory can be as much as 50 percent of a small businesss current assets. A
small business should know whether the levels are reasonable compared with sales
and how fast is the inventory turnover relative to industry trends.
4. Accounts payable is the amount of money owned suppliers. Every small business
should know whether the level is reasonable relative to purchase and if the
payment policy negatively impacts the businesss credit rating.
5. Accrued expenses and taxes payable are time obligations of the business and
represent a future cash outflow.
FACTOS DETERMINING THE WORKING CAPITAL REQUIREMENTS

1. NATURE AND SIZE OF BUSINESS
The size of business also has an important impact on its working capital
needs. Size may be measured in terms of the scale of operations. A firm with large
scale of operations will need working capital than small term. The working capital
requirement of a firm are basically influenced by the nature of business trading and
financial firm has very less investment in fixed assets, but requires a large sum of
money to be invested in working capital.
2. TECHNOLOGY AND MANUFACTURING POLICY
The manufacturing cycle starts with the purchase and use of raw materials and
completes with the production of finished goods. Longer the manufacturing cycle, larger
will be the firm working capital requirements. An extended manufacturing time span
means a larger tie-up of funds in inventories. Thus if there are alternative technologies of
manufacturing a product, the technological process with the shortest manufacturing cycle
may be chooses.
3. FIRMS CREDIT POLICY

The credit policy of the firm affects the working capital by influencing the
level of debtors. The credit term to be granted to customers may depend upon the
forms of the industry to which the firm belongs.
4. AVAILABILITY OF CREDIT
Creditors also affect the working capital requirement of a firm. A firm will
need less wronging capital if liberal credit terms are available to it.
5. OPERATING EFFICIENCY
The operating efficiency of the firm relates to the optimum utilization of

resources at minimum costs. The firm will be effectively contributing in keeping the
working capital investment at a lower level if it is efficient to controlling operating
costs and utilizing current assets. The use of working capital is improved and pace of
a cash conversion cycle is accelerated with operating efficiency.
6. BUSINESS FLUCTUATIONS
Most firm experience seasonal and cyclical fluctuation in the demand for their
products and services. This business variation effects the working capital
requirements especially the temporary working capital requirement of the firm. When
there is an upward swing in the economy, sales will increase and vice-versa.
7. PRODUCTION POLICY
A steady production policy will cause inventories to accumulate during the
off-season periods and the firm will be exposed to greater inventory cost and risk.
Thus, if the cost and risks of maintaining a constant production schedules are high,
the firm may adopt the policy of varying its production schedules in accordance with
change in demand.
8. GROWTH AND EXPANSION ACTIVITIES
The working capital needs of firm increases it growth in terms of sales of
fixed assets. It it is difficult to precisely determine the relationship between volume of
sales and the working capital needs. The critical fact however that is the need for
increased working capital funds does not follow growth in business activities but
precedes it.
CHAPTER - II
Good research is carefully planned and is conducted professionally and generates
dependable data. Data generated from good research can be used reliably for managerial
decision making.
1. The research should be described in details. Each step in the research process
should be explained in details so that another researcher will be able to repeat the
research. The sources of the data should be revealed and the means by which they
were obtained should be made clear.
2. Researcher should take care to protect the privacy of the respondents. The
researcher should be taking into consideration the welfare of the participants of
the studies as well as that of their client.
3. Data obtained from research should be used to justify the conclusion. Personal
interpretations or experiences of the researcher should be avoided.
4. Any drawback in the design should be revealed by the researcher and its effects
on the finding should be estimated.
BENEFITS OF RESEARCH:
1. Research can help businesses to communicate with their stake holders like
customers, suppliers etc. they can device important conclusions through business
research.
2. Research helps businesses to identify the opportunities and threats.
3. Risks and uncertainties can be minimized through business research. Research is
very important for evaluating the progress of the business and to exploit more
opportunities
4. It can help the business to track their benchmark and to avoid any loss which they
can incur without having market and business information.
OBJECTIVES OF THE STUDY:

The following are the objective of the study.
1. To study the working capital management of HETERO DRUGS LIMITED.
2. To examine the feasibility of present system of managing cash, debtor and
inventory.
3. To study the management of current assets and current liabilities of HETERO
DRUGS LIMITED.
4. To evaluate the financial position of the company.
5. To know the liquidity position of the company.

6. To examine the working capital turnover of the company.
7. To give suggestions for better working capital management.
SCOPE OF THE STUDY:

The following are the scope of the study.
1. The scope was limited to the operations of HETERO DRUGS LIMITED.
2. The study was confined to the evolution of last five years report (2007-2011).
3. The study focuses on analyzing the working capital management.
4. The information obtained from primary and secondary sources was limited to
HETERO DRUGS LIMITED.
LIMITATIONS OF THE STUDY:

The followings are the limitations of the study.
1. As the study period was very short, the complete financial status of the company
was not done.
2. The study having limited scope of gathering sufficient information as it is
confidential.
3. The study is limited up to the data and information provided by HETERO
DRUGS LIMITED.
4. The study has concentrated only on the working capital of the company. The other
financial aspects or components were ignored.
5. This study is confined to the HETERO DRUGS LIMITED.
COLLECTION OF DATA
Research methodology is a systematic procedure of collecting information in
order to analyze and verify a phenomenon. Data collection is a term used to describe a
process of preparing and collecting data.
Data collection is important aspects of any type of research study, inaccurate data
can impact the result of the study and ultimately lead to invalid results.
Data collection sources are two types:
1 .primary data
2. Secondary data
1. Primary Data:
In primary data collection, the data will be collected by using questionnaires and
interviews.
There are many methods of collecting primary data and the main methods include:
1. Interviews
2. Observation
2. Secondary Data:
Secondary data available from publishers, in-house database, research
agencies etc. it constitutes readymade information that can be used for research
purpose with minimal analysis. However, the research should bear in mind
secondary data is published for purpose other than the current research.
Secondary data helps researchers to save time. While primary research
takes a considerable amount of time in the form of collecting and analyzing the
data, secondary data offers readymade solutions.
SOURCES OF DATA
Methodology is systematic process of collecting information in order to analyze
and verify a phenomenon, the collection of the data two principles process.
1. Primary data
2. Secondary data
1. Primary data
The data that is collected first time for any statistical investigation and is used
in the statistical analysis is termed as primary data.
The primary data is obtained by having personal interviews with the officials of
the company, interacting with the manager & other concerned executives at the
administrative office of the company.
2. Secondary data
the data whether published, which have been already collected and processed
by some agency or person and take over from them and used by any other agency
or person for their statistical work are termed as secondary data.
The secondary data was collected mainly from the following source.
1. Annual report
2. Manuals and magazines.
3. Reference to journals, text books and news papers.
4. Company website .com.
CHAPTER - III
COMPANY PROFILE
COMPANY PROFILE
1. History of HETERO
2. Founder of HETERO
3. Manpower of HETERO
4. Management of HETERO
5. HETERO units
6. Vision & values of HETERO

7. Business focus of HETERO
8. Drug discovery
9. Alliances & partnerships
10. Research & development
11. HETERO DRUGS culture
12. Workplace ethics
13. Social responsibilities
14. News& events
15. Awards & allocates
Type
Private
Industry
Pharmaceuticals
Founded
1993
Headquarters
Hyderabad, India
Key people
Dr. B. Partha Saradhi Reddy (CMD)
Employees
Over 7,778
Website
www.heterodrugs.com
Hetero is a research based global pharmaceutical company focused on

development, manufacturing and marketing of Active Pharmaceutical Ingredients (APIs),
Intermediate Chemicals & Finished Dosages. Ever since its establishment in 1993,
Hetero showed a tradition of excellence and deep sense of commitment in developing
cost effective processes to offer wide range of affordable drugs.
Hetero is building on the strengths of vertical integration in discovery research,
process chemistry, API manufacturing, formulation development and commercialization.
Hetero is a leading international supplier with a rich portfolio of over 200 products from
wide range of therapeutic categories both in active pharmaceutical ingredients and
finished dosages.
Heteros manufacturing facilities are cGMP compliant meeting global standards in
terms of infrastructure and systems. Majority of them are approved by the various
regulatory authorities of USFDA, WHO-Geneva, Australian TGA, Spanish agency of
medicines & health care products, ANVISA-Brazil, IDA-Netherlands etc.With full-
fledged marketing capabilities, the company has been able to market its products in over
138 countries across the globe.
HISTORY OF HETERO:
Established in the year 1993, with the motto
to be the best in the API manufacturing, Hetero
today embodies the vision of a top notch player in
developing and commercializing products catering
to a variety of therapeutic categories, integrating
into a Leading finished dosage manufacturer.
True to the Statement, "Where the Future Started Yesterday", with a
foresight on the current trends in the Pharmaceutical Market, Hetero has grown from
strength to strength, combining its Research Strengths, Manufacturing Capabilities, and
Human Resources and well established quality management system.
With full-fledged marketing capabilities, the company has been able to market its
products in over 100 countries in Asia, Middle-east, Eastern Europe and Latin America.
With its compliance to the most stringent regulatory requirements, Hetero has today
gained foothold to market several of its APIs in the United States, Canada and Europe.
With all six manufacturing facilities being supported by excellent infrastructure
and compliance to the GMP requirements, Hetero has crossed numerous milestones in a
comparatively short period since its inception.
Founder:
"Where the future started yesterday....
... Works a day ahead of future...."
A Visionary Scientist
Dr. Bandi Parthasaradhi Reddy, Chairman & Managing Director of Hetero group
is academically endowed with a Post Graduate and Doctoral degrees with distinction in
the field of synthetic chemistry. Prior to founding of Hetero Drugs Limited, Dr. B.P.S
Reddy had a stint in leading pharmaceutical companies as the head of the Research &
Development division. His sharp analysis and ability to synthesize various chemical
compounds lead to the discovery of new processes, cost effective schemes for
manufacturing of various pharmaceutical products. During the said period Dr.B.P.S
Reddy has the credit of introducing many new molecules for the first time in Indian
pharmaceutical market.
A visionary the world knows as Dr. B.P.S.Reddy, is the driving force behind this
growing pharmaceutical phenomenon called HETERO. Dr.B.P.S.Reddys dream child,
Hetero was born in the year 1993 as a small API unit. Today, 17 years later, the name is
synonymous with leadership in pharmaceuticals with more than 18 manufacturing units
and 8000 employees. An entity that is grown in stature by virtue of its combined strength
in research, manufacturing and marketing.
Dr. B.P.S.Reddy steered Hetero towards the forefront of global pharmaceutical
industry with his vision to be recognized as an aggressive company that combines its
strength of R&D and manufacturing with definite advantages in terms of cost and
chemistry with a strong emphasis on quality of the products.
Dr. B.P.S.Reddy is now focusing on giving new dimensions to Hetero in terms of
research and innovation programs in discovery research to take the company to greater
heights.
MANPOWER IN HETERO GROUP:
1. Hetero Drugs Limited
1737
2. Hetero Labs Limited
5789
3. Cirex
180
4. Clinse
22
5. Hetero Infra
50
Total Employees:
7778
MANAGEMENT:
S.NO.
NAME
DESIGNATION
1.
Dr.B. ParthaSaradhi Reddy
Chairman &Managing Director
2.
M.Srinivasa Reddy
Director
3.
B.Nagi Reddy
Executive Director
4.
K. Rajesh Kumar
Finance Director
5.
A.V.Narasa Reddy
Technical Director
6.
Dr.Ratnakar
R&D
7.
B.Vamsi Krishna
Director
8.
C.Bhaskar Reddy
Quality Control Director
9.
J.Sambi Reddy
Production Director (Unit-I)
10.
C.Mohan Reddy
Production Director
11.
V.Vishwanatha Raju
Director
12.
k.madhu kumar
Projects Director
13.
Dr.r.Raji Reddy
Director
14.
Dr.P.Khadgapathi
Director
Human resource structure:
Managing Director
General Manager
Deputy General Manager
Assistant General Manger
Manager
Assistant Manager
Senior Executive
Executive
Junior Executive
Assistant Executive
Trainee
Vision and values:

Hetero believes in WHERE THE FUTURE STARTED YESTERDAY
WORKS A DAY AHEAD OF FUTURE.
HETEROS Ambition is to be an aggressive player in pharmaceutical markets
combining IIPR skills, manufacturing capabilities, strong human resources inputs and
marketing strengths.
Values in pursuit of excellence:
Innovation
Creativity
Reliability
Accessibility
Cost effectiveness
Quality
Accuracy
Customer delight
Eco friendly
Hetero visualizes itself as an aggressive player in the global pharmaceutical
scenario; supplying generics developed combining intellectual property research strength

and strong human resource inputs
The company values the concepts of having social responsibilities in the
course of its assents to greater heights. It strongly believes in focusing on customer
requirements and delivering the products at the right pace. Hetero considers its human
resource as the core of all its capabilities and believes in tapping and honing the talent of
its members to reach the zenith of success. It believes in continuous evaluation and
improvement in all the factors that contribute in transforming the organization into a
global to reckon. Hetero takes recognize the fact that the processes that it develops all eco
friendly and it should not result in any consequence that harms the ecological harmony.
Mission:
Heteros mission is to be a globally acclaimed pharmaceutical company,
meeting the requirement of healthcare imbibing the philosophy of both commercial and
social concerns, driven by research and manufacturing capabilities.
Strength:
Strong emphasis on research and development
Ability to develop processes for a large range of therapeutic categories
Ability to orient and adapt to the changing facets of industry particularly in

terms of regulations, intellectual property and manufacturing capabilities
Cohesive teams of skilled professionals in all wings related to research,

manufacturing and marketing
Strong customer base and market presence
A strong commitment towards the society to provide timely support by

providing life saving drugs at relatively low costs, short span of time.
Global presence:
Hetero exports its products across different regions USA, Canada, Europe,
Japan, Latin America, Africa, Middle East, Far East, Australia, Russia & CIS, in the
world and is catering to the requirements of around 138 countries in the world.
Business focus:
Active pharmaceutical ingredients:
Hetero is one of the largest manufacturer and supplier of Active
Pharmaceutical Ingredients (APIs) catering to the ever increasing requirements of the
global pharmaceutical market.
The infrastructure available with Hetero for manufacturing of Active
Pharmaceutical Ingredients and the intermediate chemicals is one of the best, with Stateof-the- Art facilities designed to meet the global standards and cGMP.
With 11 API manufacturing facilities in operation, Hetero has been able
to manufacture more than 200 APIs, and supply to different markets. 6 of the API
facilities are approved by USFDA, TGA, EU, PMDA, KFDA and WHO.
Hetero is a trusted supplier of several APIs in wide range of therapeutic
categories and the largest supplier of complete range in antiretroviral products. Hetero
also has dedicated facility for manufacturing of Oncology products.
Finished dosages
Hetero has world-class facilities for manufacturing wide range of finished

dosages. As a leading innovation-driven corporation, Hetero is developing a growing
portfolio of pharmaceutical products to meet some of the world's most urgent medical
needs. Today Hetero is manufacturing product portfolio of over 200 products in major
therapeutic areas, with an emphasis on antiretroviral, gastro-intestinal, cardiovascular,
antidepressants
/antipsychotic,
anti
diabetics,
pain
management,
anti-infective,
dermatology and oncology. Hetero has
Four finished dosage manufacturing facilities, out of which two are USFDA,
approved facilities.
Dedicated Oncology facility
Offers
1. Injectables
2. Solid/Liquid oral dosages
3. Ointments
4. Soft gelatin capsules
5. Inhalers
Crams
Hetero initiated customer-centric division that will provide Custom Research
and Manufacturing Services (CRAMS) for large, mid-sized and emerging biotech and
pharmaceutical entities globally.
Hetero will partner with these companies and cultivate opportunities to research,
manufacture and develop compounds across the entire drug life cycle. This division will
deliver fully-consolidated or customized manufacturing solutions for APIs, intermediate
chemicals, pre-formulations and formulations across each stage of the pharmaceutical life
cycle. Hetero provides premium solutions for product life cycle management including
life cycle extensions and line extensions.
Biotechnology
Hetero is focusing on the development and manufacturing of bio-generics for
domestic and international
markets. Five biosimilars are in the various stages of
development. Two products are expected to be commercialized in India for oncology

and nephrology indications by 2011-12.
Drug discovery:
Hetero started discovery research with the focus on developing NCEs in selected
therapeutic areas. Scientists at Drug Discovery Division are working on the
following projects :
o
ANTI-HIV Research
ANTI-HCV Research
Diabetes Research
Our business strategy is to out license early stage discovery molecules and to explore
early stage discovery collaborations to maximize the potential of our discovery projects.
Alliances / Partnerships:
At Hetero, we value alliances/partnerships. Hetero has developed
productive alliances and partnerships that advance our capacity to develop innovative
medicines at lower costs. Our collaborations have produced strong, enduring partnerships
and yielded consistent success in the market place. A glance at our track record highlights
some of our achievements while illustrating the diversity among our partners and the
products. Hetero is regarded as one of the best companies in the world to work for, and
generations of Hetero employees have sustained a culture that values excellence,
integrity, and respect for people.
Research & Development:
Research & Development is the foundation of Heteros philosophy of developing
cost-effective, high quality and safe medicines to society. Hetero Research Foundation is
one of the most innovative, productive, and respected scientific research organizations
which are recognized by the Department of Science & Technology, Government of India.
Hetero Research Foundation (HRF) has a team of over 400 dedicated scientists
working in the areas of Process, Analytical and Discovery Research. R & D centre
conforms to international standards and has advanced equipment for both basic and
applied research.
Process R&D
HRF has developed process for 150 plus molecules for various markets. The R&
D team actively involved in process development, scaling-up technology transfer and
associates with manufacturing team through out life cycle of product.
HRF has always been emphasizing to ensure that the processes being adopted for
the products are cost effective, safe to handle and with optimum advantage in terms of
yield and quality.
Analytical R&D
Analytical research at HRF is equipped to conduct complete physical and
chemical characterization of APIs/ NCEs. Further, the team is well versed with
regulatory filings and has vast experience in documentation. The infrastructure includes
advanced instruments like LC-MS-MS, GC-MS, NMR, and Powder XRD apart from
several HPLC systems.
Manufacturing infrastructure:
Hetero group as a whole has 18 Manufacturing facilities at various locations
encompassing manufacturing of Active Pharmaceutical Ingredients and Finished Dosage
Products.
Committed to quality, safety and environment, most of our manufacturing facilities
have been inspected and approved by the US FDA, WHO-Geneva, Spanish Agency of
Medicines & Health care products, ANVISA-Brazil, IDA-Netherlands etc.,
Products:
1. API's - for Regulated Market
2. API's - for Semi Regulated Market
3. Finished Dosages
4. Intermediate Chemicals
Careers at HETERO:
Heteros strength lies in the talent and commitment of the people who work for us.
Hetero is on the path of progress and expanding very fast in all its verticals. Opportunities
exist in for talented people of diverse backgrounds in various departments. Hetero creates
an environment for personal and professional growth of employees.
A healthy work-life balance is supported through knowledge-driven work
environment where ideas and skills are valued; where people can realize their full
potential through dedicated training programs; and where individual contribution is
respected, recognized and rewarded.
The Hetero drugs limited culture:
Customer Focused and Performance Driven where both external and internal
customers are accorded the highest priority and where everyone is sensitive to
Commitments, time & cost and focuses on delivering innovative affordable
medicines globally.
Entrepreneurial and innovative where genuine mistakes are tolerated,

intelligent risk taking is encouraged and people feel a sense of empowerment.
Egalitarian and Trusting where rank and status consciousness is low, leadership
walks the talk, where credibility & trustworthiness are championed and leaders
provide access to people, resources and information.
Flexible and Adaptive where change is welcome and initiatives are implemented
with sincerity and commitment, diversity is understood and accepted and mutual
respect for diversity and various ethnic cultures coexist.
Work place ethics:

Open door communication:
Hetero Drugs maintains an open-door culture for communication to assist
with employee concerns. If employee does not feel comfortable discussing concerns with
his /her supervisor or manager, they contact the next level of management. Hetero Drugs
believes that open communication is essential to a successful work environment and all
employees should feel free to raise concerns without fear of reprisal.
Courtesy:
They develop an attitude or helpfulness towards their customers,
suppliers, vendors, and their fellow employees. Courtesy is a major component of good
human relations. Good telephone etiquette is also important when dealing with others,
both inside and outside of Hetero Drugs.
Dress code:
Employees are bet advised to be formally attired on all weekdays so as to
reflect confidence and professionalism. On weekends (2 nd and 4th Fridays at head office
and all working Saturdays at all 3 locations), employees could wear informal wear as
follows.
Male employees:
Business casual (weekdays): collared shirts, Trousers, leather shoes (Black/Brown)
Casual (Fridays): Shirts/ collared T-shirts, Trousers and sports shoes
Female employees:
Formal wear: Sarees, Sal war kames, formal shirts, full skirts, trousers and sandals
Informal wear: collared T-shirts, full skirts, shirts, trousers, and sandals.
ID Cards:
All employees are issued an id card within one week of joining, and it is
advised that the cards are always worn on person while on duty. In case of the card being
lost or damaged, the personnel department needs to be informed immediately.
Leaves:
Employees are requested to avail leave as per eligibility unless exigencies

demand otherwise. Planned leave need be approved by the in-charge, in the prescribed
form available with the personnel department.
Social responsibility:
Hetero recognizes its obligations towards the society and as a socially responsible
organization; we strive to take care of the less privileged sections of our society. We
extend our expertise to transform the lives of our people and make a difference to the
society. In this initiative, Hetero has adapted few villages for their overall development.
Education:
Hetero assists in setting up of schools where there is no access to education
facilities, providing financial assistance to the poor students who have promising
academic record, adapting schools.
Sports:
Sponsors athletics from various educational institutions to participate in National
and International level competition.
Medical:
Hetero conducts periodical medical camps at various locations in socially backward
areas to provide timely medical assistance to the needy. Hetero has liberally donated
medicines to the Government of India, Government of A.P. and to various Hospitals.
News & Events:

April'2010
Hetero launches one of the Indias largest finished dosages manufacturing facility in
Special Economic Zone (SEZ) at Jadcherla. Hetero launches its new formulations
facility (SEZ) at Jadcherla, Andhra Pradesh, India. Strategically located just 60 kms from
Hyderabad International airport, off NH 7, the project situated in the state's first green
industrial park.
The total unit area is 75 acres and with two manufacturing facilities. This facility
offers a huge production capacity of 18 billion tablets and capsules per annum. It has a
dedicated Oncology facility with a production capacity of 200 million tablets & capsules,
15 million liquid injectable vials & 15 million lyophilized Injectables.
This World-class facility is meeting the cGMP and regulatory requirements, with
integrated quality management system in place. All quality control Instruments are 21CFR compliant. Walk in type stability chambers with global requirements for stability
study and Integrated building management system from Honey well -USA , Lyophilizer
VIRTIS -USA, Liquid Filling machine from BOSCH Germany, makes this
manufacturing facility at par with the best in the world.
April'2010
Hetero receives tentative approval for Tenofovir disoproxil fumarate tablets from
USFDA
Hetero is pleased to announce that it has received the tentatively approval for
Tenofovir disoproxil fumarate from the US Food & Drug Administration (USFDA).
A Tenofovir tablet 300 mg is generic equivalent to Viread tablets 300 mg of
Gilead Sciences. Tenofovir belongs to a class of antiretroviral drugs known as nucleotide
analogue reverse transcriptase inhibitors (nRTIs), which block reverse transcriptase, an
enzyme crucial to viral production in HIV-infected people. Tenofovir is indicated in
combination with other antiretroviral agents for the treatment of HIV-1 infection in
adults.
Nov'2009
Hetero receives tentative approval of Lamivudine and Tenofovir fixed dose combination
tablets, 300mg/300mg tablets from USFDA
On November 5, 2009, using expedited review procedures developed to support the
President's Emergency Program for AIDS Relief (PEPFAR1), the US Food and Drug
Administration (FDA), granted tentative approval for Lamivudine and Tenozfovir disoproxil
fumarate fixed dose combination tablets, 300mg/300mg.
The fixed dose combination product, indicated for use in combination with other
antiretroviral for the treatment of HIV-1 infection.
Awards & Accolades:
Hetero has been scaling new heights on a continual basis. These achievements have been
the result of concerted efforts on the part of different functions within the organization to achieve
the organizational goal of being a leader.
In its path to success, Hetero has seen many a milestone being crossed and achieved
many awards on various fronts. Awards for exemplary work in R&D and marketing are just a
few to name.
A track of few events that saw Hetero reaching its Zenith of glory is: sss
2009
Top Pharmexcil Gold Patent award.
Top Pharmexcil Outstanding Export Performance award in Drugs and Pharmaceuticals.
2006
Chemexil Trishul export award for outstanding export performance 2001 Excellence &
National Integration award in recognition of the efforts for excellence with affairs
connected with educational specialties and creating teaching skills besides promoting
harmony at all levels in the college.
1999
Highest exporter award against stiff competition from internationally recognized

domestic competitors.
1998-1996
Top Chemexil award for Exports.
National award for "Best Efforts in Research and Development" from the Department
of Scientific and Industrial Research, Ministry of Science and Technology, Government
of India, in the year 1996.
CHAPTER - IV
DATA ANALYSIS
AND
INTERPRETATION
STATEMENT SHOWING CHANGES IN WORKING CAPITAL

FOR THE YEAR ENDED 2007-2008
(Rs. In Crores)
As on 31st December
Changes in Working capital
2007(Rs)
2008(Rs)
Increase(Rs)
Decrease(Rs)
Inventories
30.40
34.51
4.11
---
Sundry Debtors
28.32
7.28
---
21.04
Cash and Bank Balance
52.11
1.78
---
50.33
Loans and advances
27.08
9.55
---
17.53
137.91
53.12
4.11
88.90
Current liabilities
18.11
18.02
0.9
---
Provisions
39.51
4.33
35.18
---
TOTAL CURRENT LIABILITIES(B)
57.62
22.35
35.27
---
NET WORKING CAPITAL =(A-B)
80.29
30.77
39.38
88.90
---
49.52
49.52
----
80.29
80.29
88.90
88.90
PARTICULARS
CURRENT ASSETS
TOTAL CURRENT ASSETS (A)

CURRENT LIABILITIES
Increase / Decrease in Net Working

Capital
TOTAL
INTERPRETATION:
From the above table, it can be observed that
1. Inventories were increased by Rs.4.11 crores, due to increased purchase of raw materials.
2. Sundry debtors were decreased by Rs.21.14 crores, due to decrease in credit sales.
3. Cash and bank balances were decreased by Rs.50.33 crores, due to decrease in sales.
4. Loans and advances were decreased by Rs.17.53 crores, due to decrease in loans
provided by the company.
5. Current liabilities were decreased by Rs.0.09 crores, due to the payment of pending
claims.
6. Provisions were decreased by Rs.35.18 crores, due to decrease in current liabilities.
7. The overall net working capital has been decreased by Rs.49.52 crores, due to decrease in
current assets.
8. The company should improve its net working capital position.

(Rs. In Crores)
As on 31st December
2008(Rs)
2009(Rs)
Increase(Rs)
Decrease(Rs)
34.51
54.81
20.30
---
7.28
22.84
15.56
---
1.78
1.26
---
0.52
9.55
17.70
8.15
---
53.12
96.61
44.01
0.52
Current liabilities
18.02
18.49
---
0.47
Provisions
4.33
15.16
---
10.83
22.35
33.65
---
11.03
30.77
62.96
44.01
11.82
32.19
---
---
32.19
62.96
62.96
44.01
44.01
PARTICULARS
CURRENT ASSETS
Inventories
Sundry Debtors
Loans and advances

CURRENT LIABILITIES
Capital
TOTAL
INTERPRETATION:
1. Inventories were increased by Rs.20.30 crores, due to increased purchase of chemicals.

2. Sundry debtors were increased by Rs.15.56 crores, due to increase in credit sales.
3. Cash and bank balances were decreased by Rs.0.52 crores, due to increase in advances
provided to suppliers.
4. Loans and advances were increased by Rs.8.15 crores, due to the company provided
loans to the employees.
5. Current liabilities were increased by Rs.0.47 crores, due to the credit purchases of raw
materials.
6. Provisions were increased by Rs.10.83 crores, due to increased current liabilities.
7. The overall net working capital has been increased by Rs.32.19 crores, due to increased
current assets.
8. The net working capital position of the company was satisfactory.

(Rs. In Crores)
As on 31st December
2009(Rs)
2010(Rs)
Increase(Rs)
Decrease(Rs)
Inventories
54.81
70.25
15.44
---
Sundry Debtors
22.84
62.01
39.17
---
1.26
3.57
2.31
---
17.70
35.68
17.98
---
96.61
171.51
74.90
---
Current liabilities
18.49
26.58
---
8.09
Provisions
15.16
11.10
4.06
---
33.65
37.68
4.06
8.09
62.96
133.83
78.96
8.09
70.87
---
----
70.87
133.83
133.83
78.96
78.96
PARTICULARS
CURRENT ASSETS

Loans and advances

CURRENT LIABILITIES
Capital
TOTAL
INTERPRETATION:
1. Inventories were increased by Rs.15.44 crores, due to increased purchases.
3. Cash and bank balances were increased by Rs.2.31 crores, due to increased cash sales.
4. Loans and advances were increased by Rs.17.98 crores, due to the company have
provided more loans to the employees and also advanced to the suppliers of raw
materials.
5. Current liabilities were increased by Rs.8.09 crores, due to increase in creditors.
6. Provisions were decreased by Rs.4.06 crores, due to increased cash and bank balances.
7. Total current assets were increased by Rs.74.9 crores, due to increased debtors and loans
and advances.
8. The overall net working capital has been increased by Rs.70.87 crores. Hence, the
working capital position of the company satisfactory.

(Rs. In Crores)
As on 31st December
PARTICULARS
2010(Rs)
2011(Rs)
Increase(Rs)
Decrease(Rs)
Inventories
70.25
74.50
4.25
---
Sundry Debtors
62.01
67.01
5.0
---
3.57
4.53
0.96
---
Loans and advances
35.68
45.34
9.66
---
171.51
191.38
19.87
---
Current liabilities
26.58
31.06
---
4.48
Provisions
11.10
8.55
2.55
---
37.68
39.61
2.55
4.48
133.83
151.77
22.42
4.48
17.94
---
---
17.94
151.77
151.77
22.42
22.42
CURRENT ASSETS

CURRENT LIABILITIES
Capital
TOTAL
INTERPRETATION:
1. Inventories were increased by Rs.4.25 crores, due to increased purchases.
3. Loans and advances were increased by Rs.9.66 crores, due to company provided
advances to suppliers.
4. Current liabilities were increased by Rs.4.48 crores, due to increase in creditors.
5. Provisions were decreased by Rs.2.55 crores, due to increased bank balances.

6. The overall net working capital has been increased by Rs.17.94 crores, due to increase in
current assets.
7. The net working capital position of the company was satisfactory.

(Rs. In Crores)
As on 31st December
PARTICULARS
2011(Rs)
2012(Rs)
Increase(Rs)
Decrease(Rs)
CURRENT ASSETS
Inventories
74.50
69.19
---
5.31
Sundry Debtors
67.01
55.17
---
11.84
4.53
6.80
2.27
---
Loans and advances
45.34
49.21
3.87
---
191.38
180.37
6.14
17.15
Current liabilities
31.06
18.72
12.34
---
Provisions
8.55
9.56
---
1.01
39.61
28.28
12.34
1.01
151.77
152.09
18.48
18.16
0.32
---
---
0.32
152.09
152.09
18.48
18.48

CURRENT LIABILITIES

Capital
TOTAL
INTERPRETATION:
1. Inventories were decreased by Rs.5.31 crores, due to decreased purchases.
2. Sundry debtors were decreased by Rs.11.84 crores, due to decrease in credit sales.
3. Cash and bank balances were increased by Rs.2.27 crores, due to collection of amount
from sundry debtors.
4. Loans and advances were increased by Rs.3.87 crores, due to the company provided
loans to the employees.
5. Current liabilities were decreased by Rs.12.34 crores, due to decrease in amount of credit
purchases.
6. Provisions were increased by Rs.1.01 crores, due to decrease in sundry debtors.

7. The overall net working capital has been increased by Rs.0.32 crores, due to increase in
current assets.
8. The net working capital position of the company was showing average performance.
CURRENT RATIO:
Current ratio is the common ratio for measuring liquidity, being related to working capital
analysis; it is also called as the current ratio, which expresses the relationship between
current assets and current liabilities. The current ratio is the ratio of total current asset to total
current liabilities. It is calculated by dividing current assets by current liabilities.
FORMULA:
Current Assets
Current ratio= --------------------------Current Liabilities
Standard Current Ratio: Generally 2:1 is considered as ideal for the concern
CURRENT RATIO TABLE:

Years
(Rs. In Crores)
Current Assets(Rs)
Current liabilities (Rs)
Ratio
2007-2008
53.12
22.35
2.37
2008-2009
96.61
33.65
2.87
2009-2010
171.51
37.68
4.55
2010-2011
191.38
39.61
4.83
2011-2012
180.37
28.28
6.37
692.99
161.57
4.28
Average Current Ratio
INTERPRETATION:
1. The analysis shows that the current ratio of the company has been showing an increasing
trend during the period of the study.
2. The increase in the current ration is 4.28:1 due to the increase of current assets over the
current liabilities.
3. The average current ratio is 4.28:1. So the companys liquidity position is satisfactory.
4. The current ratio reveals that the companys short-term funds are locked in current assets.
5. It shows the inefficient management of current assets.
QUICK RATIO:
Quick ratio is also known as liquidity ratio or acid test ratio or near money ratio. It is the
ratio between quick or liquid and current liabilities. This ratio is calculated by dividing the
quick assets by the current liabilities.
FORMULA:
Quick Assets
Quick ratio= -------------------------------Current Liabilities
Standard for Quick Ratio: Generally 1:1 is considered as ideal for the concern.
QUICK RATIO TABLE:
(Rs. In Crores)
Years
Current Assets (Rs)
Ratio
2007-2008
18.61
22.35
0.83
2008-2009
41.8
33.65
1.24
2009-2010
101.26
37.68
2.68
2010-2011
116.88
39.61
2.95
2011-2012
111.18
28.28
3.93
389.73
161.57
2.41
Average Quick Ratio
INTERPRETATION:
1. The analysis shows that the quick ratio was increasing from year to year during the
period of the study.
2. In the year 2011-2012 the ratio was satisfactory, because of increased quick assets.
3. The average quick ratio is 2.41:1. So, the liquidity position of the company is satisfactory.
4. Ever though the liquidity position is good, the analysis showing that there are idle funds
locked in quick assets.
5. It reflects the inefficient management of short-term funds, it should be avoided.
WORKING CAPITAL TURNOVER RATIO:

This ratio indicated the velocity of the utilization of net working capital. This ratio
indicates the number of times the working capital is turned over into sales in the course of a
year. The ratio measures the efficiency with which the working capital is being used by a
firm. A higher ratio indicates the efficient utilization of working capital and a low ratio
indicates otherwise.
FORMULA:
Cost of goods sold
Working capital turnover ratio =
--------------------------Working capital
Working capital = Current assets-Current Liabilities
WORKING CAPITAL TURNOVER RATIO TABLE: (Rs. In Crores)

Years
Current Assets
Ratio
30.77
3.50
(Rs)
2007-2008
107.82
2008-2009
151.37
62.96
2.40
2009-2010
160.78
133.83
1.20
2010-2011
204.46
151.77
1.34
2011-2012
269.64
152.09
1.77
894.07
531.42
1.68
Average Working
Capital Turnover Ratio
INTERPRETATION:
1. By observing the above working capital turnover ratio table, the ratio was showing
fluctuating trend during the study period.
2. The ratio was showing an increasing trend from 2010-2011 to 2011-2012, due to
increased net sales.
3. In the year 2009-2010. It is having a less working capital turnover ratio of 1.20 times,
because of increased expenses.
4. The average working capital turnover is 1.68:1. So, the company is not efficiently
managing its working capital.
ABSOLUTE LIQUID RATIO:

Absolute liquid ratio is also called as cash position ratio. This ratio established the
relationship between the absolute liquid assets and current liabilities. Absolute liquid
assets include cash in hand, cash at bank, and marketable securities.
The optimum value for this ratio should be one, i.e., 1:2
Formula:
Absolute liquidity ratio = ( Cash In Hand and Bank + Marketable Securities )/
Current Liabilities
ABSOLUTE LIQUID RATIO TABLE:

Years
Absolute liquid
(Rs. In Crores)
Ratio
Assets (Rs)
2007-2008
1.78
53.12
0.033
2008-2009
1.26
96.61
0.013
2009-2010
3.57
171.51
0.021
2010-2011
4.53
191.38
0.024
2011-2012
6.80
180.37
0.038
Average Absolute Liquid
17.94
692.99
0.026
Ratio
INTERPRETATION:
1. By observing the above absolute liquid ratio table, it is fluctuating year to during the
2. The ratio was showing an decreasing trend from 2007-2008 to 2008-2009, due to
decreased cash and bank balances.
3. In the year 2010-2011 to 2011-2012, the absolute liquid ratio is in better position by
comparing the other years.
4. The average absolute liquid ratio is 0.026 times. So, the companys liquidity position of
the company is satisfactory.
INVENTORY RATIO:
In order to ascertain that there is no overstocking, the ratio of inventory to working
capital should be calculated. It is worked out as follows:
FORMULA:
Inventory
Inventory Ratio =
------------------------Working capital
INVENTORY RATIO TABLE:

Years
(Rs. In Crores)
Inventory (Rs)
Working capital (Rs)
Ratio
2007-2008
30.40
80.29
0.37
2008-2009
34.51
30.77
1.12
2009-2010
54.81
62.96
0.87
2010-2011
70.25
133.83
0.52
2011-2012
74.50
151.77
0.49
264.47
459.62
0.674
Inventory Ratio
INTERPRETATION:
1.
The analysis shows that the Inventory Ratio was decreased from year to year
during the period of study.
2.
In the year 2008 to 2009 the inventory was satisfactory, because of increased
inventory ratio.
3.
By observing the above Inventory Ratio table, it is fluctuating year to during the
4.
From the year 2008-2012 the ratio was continuously decreasing.
5.
The companys Inventory Management is not satisfactory.
CHAPTER - V
CONCLUSIONS
AND
SUGGESTIONS
CONCLUSIONS
1. During the study period inventories have been showing an increasing trend, except in the year
2011-2012.
2. Current assets were increased during the study period.
3. The analysis reveals there are more idle funds in current assets.
4. The analysis shows that the company is showing more funds in quick assets than the required
5. Loans and advances were increased during the study period.
6. During the study period sundry debtors have been showing an increasing trend, except in the
Year 2011-2012.
7. Cash and bank balances were increased during the study period.
8. During the study period the company is having more funds in current assets. It shows that
there are Non Performing Assets with company.
SUGGESTIONS
1. The company has to take proper measures to improve its working capital position.
2. It is better to offer credit facility to the same extent to its customers in order to increase
the sales.
3. The company has to maintain cash balances to meet daily requirements as per standards.
4. The company has to manage current assets properly to improve liquidity position.
5. The company has to manage its funds in quick assets properly.
6. The company has to make policies to improve its efficiency in managing inventory and
Debt management services.
7. The idle funds, which were locked in current assets, should be utilized properly.
BIBLIOGRAPHY
BIBLIOGRAPHY
TITLE OF THE BOOK
AUTHOR
PUBLISHERS
Management Accounting,
Shashi K Gupta & R.K.Sharma
Kalyani
Financial Management,
M.Y.Khan and P.K.Jain
Tata McGraw-Hill
Financial Management,
S.N. Maheshwari
Sultan Chand & Sons
WEBSITES
www.heterodrugs.com
www.moneycontrol.com
APPENDIX
Balance sheet HETERO DRUGS Ltd.

Balance Sheet
------------------- in Rs. Cr. ------------------Mar '12
Mar '11
Mar '10
Mar '09
Mar '08
12 mths
12 mths
12 mths
12 mths
12 mths
Total Share Capital
24.45
24.15
12.08
8.26
7.98
Equity Share Capital
Sources Of Funds
24.45
24.15
12.08
8.26
7.98
Share Application Money
0.00
0.00
0.00
0.00
0.03
Preference Share Capital
0.00
0.00
0.00
0.00
0.00
137.53
136.88
133.83
43.37
23.67
0.00
0.00
0.00
0.00
0.00
161.98
161.03
145.91
51.63
31.68
Secured Loans
91.93
70.13
39.51
39.55
25.37
Unsecured Loans
17.52
11.04
1.14
1.14
1.13
Reserves
Revaluation Reserves
Networth
Total Debt
109.45
81.17
40.65
40.69
26.50
Total Liabilities
271.43
242.20
186.56
92.32
58.18
Mar '12
Mar '11
Mar '10
Mar '09
Mar '08
12 mths
12 mths
12 mths
12 mths
12 mths
Application Of Funds
Gross Block
117.27
51.65
32.88
26.87
24.01
Less: Accum. Depreciation
23.45
8.21
6.29
4.60
3.20
Net Block
93.82
43.44
26.59
22.27
20.81
Capital Work in Progress
21.98
37.78
17.03
4.33
3.83
0.03
2.69
2.69
2.69
2.69
Inventories
69.19
74.50
70.25
54.81
34.51
Sundry Debtors
55.17
67.01
62.01
22.84
7.28
6.80
4.53
3.57
1.26
1.78
Total Current Assets
131.16
146.04
135.83
78.91
43.57
Loans and Advances
49.21
45.34
35.68
17.70
9.55
Investments
Fixed Deposits
Total CA, Loans & Advances
Deffered Credit
Current Liabilities
Provisions
Total CL & Provisions
Net Current Assets
Miscellaneous Expenses
Total Assets
0.00
0.00
0.00
0.00
0.00
180.37
191.38
171.51
96.61
53.12
0.00
0.00
0.00
0.00
0.00
18.72
31.06
26.58
18.49
18.02
9.56
8.55
11.10
15.16
4.33
28.28
39.61
37.68
33.65
22.35
152.09
151.77
133.83
62.96
30.77
3.51
6.53
6.39
0.06
0.07
271.43
242.21
186.53
92.31
58.17
Contingent Liabilities
1.04
1.07
0.97
1.67
1.29
Book Value (Rs)
6.63
6.67
12.08
62.53
39.68
Source : Dion Global Solutions Limited
Profit & Loss HETERO DRUGS Ltd.
Profit & Loss account
------------------- in Rs. Cr. ------------------Mar '12
Mar '11
Mar '10
Mar '09
Mar '08
12 mths
12 mths
12 mths
12 mths
12 mths
287.80
218.63
177.19
168.31
120.67
Income
Sales Turnover
Excise Duty
Net Sales
Other Income
18.16
14.16
16.41
16.94
12.85
269.64
204.47
160.78
151.37
107.82
3.02
2.26
1.56
3.03
1.35
Stock Adjustments
-13.64
4.56
15.05
19.78
12.12
Total Income
259.02
211.29
177.39
174.18
121.29
173.52
140.63
113.33
110.14
74.87
5.88
3.20
2.89
2.43
2.36
10.30
5.97
3.79
3.14
2.67
4.45
8.37
10.45
11.57
10.32
17.86
12.23
9.51
8.56
6.44
Miscellaneous Expenses
0.91
0.72
0.71
0.69
0.63
Preoperative Exp Capitalised
0.00
0.00
0.00
0.00
0.00
Expenditure
Raw Materials
Power & Fuel Cost
Employee Cost
Other Manufacturing Expenses
Selling and Admin Expenses
Total Expenses
212.92
717.12
140.68
136.53
97.29
Mar '12
Mar '11
Mar '10
Mar '09
Mar '08
12 mths
12 mths
12 mths
12 mths
12 mths
Operating Profit
43.08
37.91
35.15
34.62
22.65
PBDIT
46.10
40.17
36.71
37.65
24.00
Interest
16.50
10.59
7.48
8.34
4.78
PBDT
29.60
29.58
29.23
29.31
19.22
2.76
1.92
1.70
1.41
0.95
Depreciation
Other Written Off
Profit Before Tax
1.69
25.15
1.67
1.60
0.01
0.01
25.99
25.93
27.89
18.26
Extra-ordinary items
-4.11
-3.22
0.00
-0.10
-0.41
PBT (Post Extra-ord Items)
21.04
22.77
25.93
27.79
17.85
Tax
7.86
4.83
9.61
9.82
4.68
Reported Net Profit
13.19
17.95
16.32
18.08
13.59
Total Value Addition
39.40
30.49
27.35
26.39
22.42
Preference Dividend
0.00
0.00
0.00
0.00
0.00
Equity Dividend
0.00
2.42
1.93
1.81
0.61
Corporate Dividend Tax
0.00
0.41
0.33
0.31
0.10
2,444.60
2,415.20
1,207.60
82.56
79.76
Earning Per Share (Rs)
0.54
0.74
1.35
21.89
17.04
Equity Dividend (%)
0.00
10.00
8.00
15.00
10.00
Book Value (Rs)
6.63
6.67
12.08
62.53
39.68
Per share data (annualised)

Shares in issue (lakhs)
Source : Dion Global Solutions Limited

Hetero Drugs Project

Caricato da

Informazioni sul documento

Copyright

Formati disponibili

Condividi questo documento

Condividi o incorpora il documento

Opzioni di condivisione

Hai trovato utile questo documento?

Questo contenuto è inappropriato?

Copyright:

Formati disponibili

Hetero Drugs Project

Caricato da

Copyright:

Formati disponibili

PROJECT REPORT

MASTER OF BUSINESS ADMINISTRATION

VAAGDEVI ENGINEERING COLLEGE

VAAGDEVI ENGINEERING COLLEGE

BOLLIKUNTA- WARANGAL-506 005

This is to certify that Mr. M. RAKESH, H.T.No: 10UK1E0017 is a bonafide student of

JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY, Kukatpally,

VAAGDEVI ENGINEERING COLLEGE

(Affiliated to Jawaharlal Nehru Technological University, Kukatpally, Hyderabad)

This is to certify that the project entitled WORKING CAPITAL MANAGEMENT

(Sri G. BHANU CHANDER)

I hereby declare that the Project entitled WORKING CAPITAL MANAGEMENT OF

I take this opportunity to express my thanks to HETERO DRUGS LTD,

DATA ANALYSIS AND INTERPRETATION

CONCLUSIONS AND SUGGESTIONS

Conversion of cash into raw materials.

Conversion of raw material into work in progress.

Conversion of work in progress into finished goods.

Conversion of finished goods into accounts receivable, and

Conversion of account receivable into cash.

completes one cycle determines the requirements of working capital

Need of working capital management

There are two concepts of working capital management

On the basis of concept working capital can be classified as gross working

4. Pay government taxation and providers of capital dividends

Construction, renovation or improvements to the leasehold.

To but furniture, fixtures, machinery, or equipment.

Sources of working capital

FACTOS DETERMINING THE WORKING CAPITAL REQUIREMENTS

3. FIRMS CREDIT POLICY

The operating efficiency of the firm relates to the optimum utilization of

OBJECTIVES OF THE STUDY:

5. To know the liquidity position of the company.

SCOPE OF THE STUDY:

LIMITATIONS OF THE STUDY:

6. Vision & values of HETERO

Dr. B. Partha Saradhi Reddy (CMD)

Hetero is a research based global pharmaceutical company focused on

2. Hetero Labs Limited

Dr.B. ParthaSaradhi Reddy

Chairman &Managing Director

Quality Control Director

Production Director (Unit-I)

Human resource structure:

Vision and values:

scenario; supplying generics developed combining intellectual property research strength

Strong emphasis on research and development

Ability to develop processes for a large range of therapeutic categories

Ability to orient and adapt to the changing facets of industry particularly in

Cohesive teams of skilled professionals in all wings related to research,

Strong customer base and market presence

A strong commitment towards the society to provide timely support by

Hetero has world-class facilities for manufacturing wide range of finished

dermatology and oncology. Hetero has

Dedicated Oncology facility

markets. Five biosimilars are in the various stages of

development. Two products are expected to be commercialized in India for oncology

Entrepreneurial and innovative where genuine mistakes are tolerated,

Work place ethics:

Employees are requested to avail leave as per eligibility unless exigencies

News & Events:

Top Pharmexcil Gold Patent award.

Top Pharmexcil Outstanding Export Performance award in Drugs and Pharmaceuticals.

Highest exporter award against stiff competition from internationally recognized