A

Summer Training Project

On

FINANCIAL ANALISYS OF KHANDELWAL EDIBLE OILS LTD

Submitted By
Shiva Gupta
Roll No. 1268770103
MBA. batch 2012-2014

In partial fulfillment of the requirement of the degree of master of business administration

Submitted To:

Mr. Sanjeev Agrawal

SUMMER TRAINING PROJECT REPORT

 On

FINANCIAL ANALISYS OF KHANDELWAL EDIBLE

OILS LTD

FOR THE PARTIAL FULLFILLMENT FOR THE AWARD OF MASTER OF BUSINESS

ADMINISTRATION
FROM
GAUTAM BUDHHA TECHNICAL UNIVERSITY, LUCKNOW

Submitted to: Under the guidance of:

GAUTAM BUDDHA TECHNICAL
UNIVERSITY, Mr. Rohit Kaushik
Lucknow. Faculty, M.B.A.
Department

Submitted by:
Shiva Gupta
M.B.A. 3RD SEM
Roll No.- 1268770103
 CERTIFICATE

This is to certify that HIMANSHU student of MBA III Semester in our institute has successfully
completed his summer training project entitled auto comp for the partial fulfillment of the
Master of Business Administration degree.

HIMANSHU
MBA III SEM

PREFACE
Decision making is a fundamental part of the research process. Decisions

regarding that what you want to do, how you want to do, what tools and

techniques must be used for the successful completion of the project. In fact

it is the researchers efficiency as a decision maker that makes project

fruitful for those who concern to the area of study.

Basically when we are playing with computer in every part of life, I used it in

my project not for the ease of my but for the ease of result explanation to

those who will read this project. The project presents the role of financial

system in life of persons.

I had toiled to achieve the goals desired. Being a neophyte in this highly

competitive world of business, I had come across several difficulties to make

the objectives a reality. I am presenting this hand carved efforts in black and

white. If anywhere something is found not in tandem to the theme then you

are welcome with your valuable suggestions.

HIMANSHU
MBA III SEM

ACKNOWLEDGMENT
The completion of any work depend upon cooperation, coordination, combine affords of several
sources and personals. Hence we approach this matter of acknowledgement through these lines,
trying our best to give full credit wherever it is due.
This project report, AUTO COMP CORPORATION PANSE PVT.LTD.. First has been
developed by me but the entire credit goes to all pupils without whose support it would have
been impossible.
Above all I thank ALMIGHTY GOD for his manifold mercies to carry out the study
successfully.
I would like to convey my thanks to Mr. SANJAY MISHRA who gave me proper guidance and
support and also his valuable time and knowledge towards the completion of the project report.
.The acknowledgment would be incomplete if I will fail to express my gratitude of my Family
Members, who are responsible for education all round development and those who maintained
and furnished information and also help me in every way possible.

HIMANSHU
MBA III SEM

CONTENT
 Introduction of the Organization

Need of study or Research Problem

Objective of the Study

Research Methodology

Data presentation and Analysis

Financial analysis

Findings of the study

Suggestions and Recommendations

Bibliography

10. Appendix
INTRODUCTION

With a history that goes back to 50 years, B.L. Agro Oils Ltd. is a company with a simple
corporate objective - to manufacture, package and market the purest possible edible oil that
would offer healthier and tastier solution to millions of consumers. Currently, B.L. Agro is in the
business of Refining, Quality Control, Packaging and Marketing of branded mustard and other
edible oils.
VISION
To be a way of life for every Indian.

MISSION
To be the benchmark in purity and perfection. To achieve a leadership position in the Indian
market and to become the preferred Indian edible oil name globally.
QUALITY POLICY
B.L. Agro Oils Ltd. is committed to total customer satisfaction, and compliance with regulatory
bodies at all times and at maximum effectiveness.
We aim to
- Consistently enhance our understanding of market dynamics and changing customer needs so
as to offer finest quality products that at all times meet our customers' expectations and the ever
changing demands of the market place.
- Provide a high level of service to our customers with minimum cause for complaint.

- Maintain a healthy & constructive work environment that enables personnel to produce
Optimal output.
- Continually comply with the requirements of ISO 9001:2000, ISO 14002:2004, HACCP and
other government regulations and continuously improve the effectiveness of our Quality
Management System.
MANAGEMENT

The foundations of B.L. Agro were laid half a century ago by its Managing Director,
Shri Ghanshyam Khandelwal - a veteran of the Indian mustard industry. Since then the
management of B.L. Agro has gained an unmatched, in-depth insight of the industry and the
continuously evolving customer needs. The leadership at B.L. Agro has a vision for the future
and their acumen in adapting to the changing times has translated into consistent growth by the
company.
However, the most important attribute of the B.L. Agro leadership is the un-fallible commitment
towards quality, towards customers and towards community at large.
At B.L. Agro 'No Compromise with Quality' is a guiding philosophy. And the management takes
it as their responsibility to not just ensure the highest quality standards of company's products but
also to instill this 'quality attitude' in every member of the B.L. Agro organization.
Another distinctive characteristic of the B.L. Agro management team is their strong belief that
Success and growth do not mean much unless accompanied by trust and respect from the
community. And over the years this belief has ensured that as a corporate citizen, B.L. Agro
Oils Ltd. earns an image of one of the most respected and revered organization in its region of
activity.
Company Profile Directors
Ghanshyam Khandelwal
Managing Director

A true entrepreneur, Ghanshyam Khandelwal stepped into the mustard oil trading business in the
1950s when he was still at a very young age. Beginning from Bareilly, he single-handedly
expanded operations and soon transformed Bail Kolhu into one of the most preferred mustard oil
brand in the entire belt of Eastern UP.

A man of foresight and vision Ghanshyam Khandelwal has been the guiding force behind
consistent growth of B.L. Agro Oils Ltd. With an eye on the future, he has, over the years,
displayed a tremendous prowess for anticipating the changing consumer needs and has
repeatedly led the organization to be a winner in a dynamic industry scenario. The mantras of his
success include his unflinching commitment towards quality and his passion for perfection.
An un-doubted achiever, he is a man of undaunted determination and courage along with
exemplary business acumen.

What distinguish Ghanshyam Khandelwal are his philosophies that originate from his
commitment towards the community. A man of values, he strongly believes in business ethics
and corporate social responsibilities.
Ashish Khandelwal
Director - Finance & Sales
Post Graduate in Commerce, Ashish Khandelwal joined his father's business at a very young age.
A quick learner and a very hard worker he learnt the nuances of the trade within no time and
established himself as a growth motivator by bringing in new-age marketing concepts and fresh
opportunities.
With extraordinary abilities in sales and channel management, Ashish Khandelwal has an
unmatched hold on the market pulse. Still in his prime youth, he has already played a key role in
taking B.L. Agro to newer heights. In his leadership, the company entered into the consumer
packs segment and the venture resulted in unprecedented success.
Having spent over 12 years in this trade, Ashish Khandelwal possesses a rare combination of
experience as well as youthful exuberance. With a futuristic outlook, he has an unmatched ability
to think ahead of the times and a vision that is set to take B.L. Agro into a glorious future.
Richa Khandelwal
Director Marketing

BTech from IET, Lucknow and MBA from ICFAI, Hyderabad. Richa Khandelwal adds a fresh
dimension to the management competencies at B.L. Agro. Among her many contributions to the
organization is her vision to take B.L. Agro to the highest national and international level.

With path-breaking ideas, Richa Khandelwal has played a key role in further strengthening the
Bail Kolhu and other B.L. Agro brands and has led its expansion into Delhi NCR and other
newer territories with outstanding success. In a short span of time, she has turned Bail Kolhu into
a household name in Delhi that has already become the largest selling mustard oil in certain
regions.
Always a forward looking person, Richa Khandelwal has helped the organization get into an
overdrive with her astute marketing strategies and innovative techniques.

Growth so Far

Having started as a mustard trading house in 1958, B.L. Agro has come a long way today. During
the course of its journey, 1999 proved to be a landmark year which transformed the business
house from a commodity trading organization to an FMCG company. The year witnessed the
birth of B.L. Agro Oils as a registered company and also marked its advent into quality control,
packaging and marketing of consumer packs of their flagship brand - Bail Kolhu Kachchi Ghani
Mustard Oil. Achieving an astonishing turnover of Rs. 60 crores in the first year itself, the
company has not looked back since.

Expansion and up-gradation has been a continuous process for B.L. Agro. The marketers of a
single mustard oil brand subsequently started rolling out multiple varieties of mustard oil - thus
catering to a much wider consumer base. As the product range swelled, the competencies,
capabilities and capacities were continuously enhanced to meet the growing challenges. However
even with its ever-expanding size, B.L. Agro never lost sight of its ultimate goal that of
providing only the highest product quality - and hence set up its own advanced quality control
systems and packaging facilities.

Later, the company took another stride when being a player in the lone mustard oil segment, B.L.
Agro diversified into Refined Soybean oil and then further to various blended edible oils. In
2006, B.L. Agro achieved yet another milestone when it established its own state-of-the-art
Refinery.

What Drives Success

 The Market and Consumer Insights possessed by B.L. Agro leadership is unparalleled. B.L.
Agro understands that eating habits of consumers are very individualistic and vary from house to
house. And in order to make a long term relationship with the collective base, the company needs
to pack Real Customer Delight in each pack that it offers.

Moreover what has brought laurels to B.L. Agro and awarded it a leadership position is the
company's ability to anticipate and adopt to Market Demand Shifts resulting from either
consumer Living Pattern Shifts or any other reason. At B.L. Agro, change has been one of the
most consistent processes. Be it technological capabilities, be it the strength of human minds or
be it the collective efficiencies, B.L. Agro has always anticipated the changing environment and
empowered itself for the same.

The most important success driver at B.L. Agro is its ability to offer Consistency of Highest
Quality Standards. Pack by pack, batch by batch, consignment by consignment, the products of
B.L. Agro carry exactly the same quality and purity standards for which they have gained
widespread respect.

Strength
 The processes and facilities at the B.L. Agro plant match the highest standards The Double
Filter Process for Mustard Oil ensures that only the purest product is dispatched from the B.L.
Agro plant. The Refining is undertaken by Chemical Refining process through which flows out
the purest form of cooking oil that beats the best known brands on transparency tests. Moreover,
the oil is processed using the Nitrogen Blanketing process that reduces the loss of nutritional
values and ensures Maximum Nutrition Retention (MNR) in the Refined Oils.

B.L. Agro Oils Ltd. is also one of the selected oil players in the country that have been granted
the Blending License thus enabling it to further expand its product portfolio. With the vast
possibilities in Blending, the company is now in a position to develop many new products and
cater to the evolving consumer needs.

Whatever the product and whatever be the process, at B.L. Agro the Purity & Hygiene factor is
always the topmost priority. At its technologically advanced refinery plant, all processes are
designed to be automated. Right from the un-loading of the crude oil tankers to the filling and
packaging of oil in various pack-sizes, the product remains untouched by human hand.

As a result the established Edible Oil Brands of B.L. Agro are today enjoying Market
Leadership in a vast market and region. The unique taste preference developed by the company's
products ensure an unflinching consumer loyalty that in turn results in the consistent demand for
the company.

The company has secured sources for supply of crude oil. The identification of multiple regions
ensures that supplies to B.L. Agro are not affected by climatic adversities or any other form of
agricultural contingencies.

One of the unique strengths of B.L. Agro is that the company even has its own facilities for
manufacturing of packaging materials used for its products. This results not just in controlling
the costs and enhancing value but also in maintaining the product purity to the last possible level.
 The company has an Excellent Track Record With the Management experience of 50 years,
B.L. Agro has displayed a consistent and exemplary growth right since its inception.

B.L. Agro Oils Ltd. possesses India's largest mustard oil packaging facilities.

In-house QC Lab Best equipped & biggest in UP. The company has an in-house Quality
Control Laboratory with a Gas Chromatography that ensures purity, ideal blends and PFA
certified quality of all B.L. Agro products.

The company's lab is the biggest and best equipped in the entire state of Uttar Pradesh.

To further complement its efforts and enhance its performance the company has established
Enterprise Resource Planning (ERP) systems and has obtained ISO 9001:2000, ISO 14002:2004
and HACCP certifications.

Potential Market Dynamics

Overview of Edible Oil Industry

In India the popular cooking mediums include Mustard Oil, Groundnut Oil, Sunflower Oil,
Coconut Oil, Soyabean Oil and Palm Oil.
Mustard, Soyabean and Palm Oil (mainly imported) account for over 75% of total edible oil
consumption.
Only around 16% of the households in India consume branded edible oils.
 Among branded oils, refined oils account for 60% of consumption and crude oils
(only filtered) account for the balance.
Branded edible oils have penetrated 31% of households in urban areas and only 9% in rural
areas.
The edible oil sector in India is largely unorganized with only a few organized players.
Edible oil is sold in the country either in consumer packs (less than 5 lt pack sizes), bulk packs
(15 kg/ lt) or as loose oil in tankers or barrels.

Macroeconomic situation Industry growth rates

Indian edible oil economy is world's fourth largest after USA, China and Brazil (India accounts
for 7% of world oilseeds & oil meal production and 10% of world consumption of edible oil).
2nd largest import bill item for India - favorable government policies for domestic industry by
way of high import duties on imported edible oils.
Increasing health consciousness, preference for packaged products (hygiene factors and
avoidance of any adulteration) and low-saturated fat cooking mediums.

Current & expected demands

According to an estimate, the demand for edible oils is expected to increase from current levels
of 11.5 million tones to 15.6 million tones in 2010 and 21.3 million tones by 2015.
Growth Opportunities
Emergence of branded edible oil as a high growth segment in Indian FMCG industry.

With a huge proportion of total Indian households still not using branded oils but displaying
continuous shift in their using pattern - from loose unbranded oils to packed branded oils, the
category of branded edible oils has emerged as a high growth segment in the Indian FMCG
industry.
With an excellent record of adapting to the dynamic trends, B.L. Agro Oils Ltd. is well
positioned and preparing itself to play an important role in facilitating this transition in consumer
behavior.
Future Strategy & Growth Plans

Expansion in geographic reach and newer markets - The company has already extended its
distribution network covering almost entire North India and is now poised to further expand in
newer markets.

To meet the challenges of growing demands, B.L. Agro is preparing for capacity enhancement
and expansion of manufacturing capabilities.

The company has an ambitious plan for setting up an Integrated Oil Complex for which it has
already identified the locations. With comprehensive facilities available within this complex, the
company will be able to provide integrated solutions and enhance its competitive pricing power.

In addition to the existing facilities, the proposed complex will include Solvent Extraction
Plant, Rice Bran & Sunflower Refinery and Mustard Crushing Facilities.

To make its procurement processes smooth and cost effective B.L. Agro oils is also
contemplating setting up of Rack Facilities connecting its Oil Complex to various Port.

With the addition of Mustard Crushing Facilities, the company plans to consolidate as
well as increase its market share in the mustard segment.
 Increase in brand power B.L. Agro Oils Ltd. has planned widespread promotional and
consumer connect campaigns to achieve an increase in its brand power.

The company is working to expand its product and brand portfolio through extension of the
existing lines as well as through diversification into other edible food items.

Through ensuring a substantial market share in the mustard oil as well as other segments, B.L.
Agro aims to obtain better pricing power.
Corporate Social Responsibility
As socially responsible citizens, the promoters of B.L. Agro are committed to contribute their bit
in the nation building process and work towards the betterment of the society.

The Khandelwal family actively participate in and support various community service programs
like Blood Donation camps, Plantation Drives, Service for
Physically Disabled etc.
As an environment sensitive industrial house, B.L. Agro takes various voluntary measures in
addition to the mandatory steps to ensure environment conservation.
Theseinclude
Effluent Treatment Plant for Water Pollution Control as well as Water Conservation.
Installation of advanced equipments for Air Pollution Control.
Use of only Agriculture Bio-Mass for steam generation; and many more such measures.
Khao Sarson, Jiyo Barson

Mustard OilThe Healthiest One

Mustard Oil is extracted at a low pressure at low temperature (40-600C).
It contains 0.30-0.35 % essential oil (AllylIso-Thiocynate) which acts as preservative.
Mustard Oil is one of the best cooking oil particular for heart patient because it has an Omega 3
(MUFA) and 6 Fatty Acid composition (Linolic and alpha Linolic Acid respectively) in good
proposition close to 10:1 rarely found in any other oil.
The ideal ratio of Omega 6 and Omega 3 is 10:1.A Favourable Composition
Organization structure & hierarchy

Organization design & structure

HIERARCHY OF KHANDELWAL EDIBLE
Ideal Product Mix Bail Kolhu
Bail Kolhu Kachchi Ghani Mustard Oil is the flagship brand of the company. This is a Grade A
Mustard Oil and due to its unique taste and ideal pungency, it enjoys a tremendous consumer
preference throughout the states of UP, Uttaranchal and Delhi.

Bail Kolhu is a clear market leader in most of its distribution territories and commands almost
monopolistic leadership position in many of the markets. Bail Kolhu also enjoys a very high
level of brand recall and brand loyalty amongst a vast consumer base.

Mohan Dhara
Mohan Dhara is a well-accepted brand in the Refined Soyabean Oil segment.

Balance Lite
this is a fast growing brand that has facilitated the advent of B.L. Agro in the Refined Vegetable
Oil segment.
 Aviral Dhara
Aviral Dhara is a multi-product brand of Mustard Oil, Palmolein Oil, and Vegetable Oils. Having
gained instant acceptance in the market, the brand is on a steady growth chart.

NewProductDevelopment
In its quest to further expand its operations and reach for larger customer base,
B.L. Agro is in the process of developing ambitious new products. Nourish Delite A soon to be
launched multi-product National Food brand.
Nourish Delite is a Dream Project of B.L. Agro management that promises to enhance the image
as well as scale of company's operations.
First product to be offered under this brand will be Premium Soyabean oil followed by Premium
Mustard Oil. The line will be further expanded to multiple food products that will even extend
beyond edible oils and include products like Atta, Besan, Pulses on one hand and Packaged
Drinking Water on the other. At B.L. Agro, the vision is to make Nourish Delite India's biggest
and most trusted Food Brand and the company is planning and preparing to make this dream a
reality.
Objective of the study:
The main objective of the study is financial analysis of B.L. Agro oils ltd.
are -
To know the sales revenue and growth rate of B.L. Agro oils ltd.
To know the financial position of B. L. Agro.
To Find out different accounting ratios of B.L. Agro.
To enhance my knowledge about production process.
To find out the different future plans of B.L. Agro oils ltd.
Research Methodology:
My project report is secondary data base so the secondary data is collect on the basis of
requirement, convenience and availability of data as well as the reliability of data. The sources
through which the data is collected such as-
Newspaper, Internet, Balance sheets and some other sources of the company.

Research methodology deals with the various methods of research. The purpose of the
research methodology is to describe the research procedure used in the research.
Research methodology helps in carrying out the project report in by analyzing the
various research findings collected through the data collection methods.

In the project I am collecting the data from various website through internet because my project
based on secondary information which is already available somewhere.

Research methodology may be treated as the heart of the projects. Without a proper and well
organized plan it is impossible to complete the projects and draw conclusive and prepare result.

Research methodology is a systematic way which consists of series of action or steps necessary
to effectively carry out research and the desired sequencing of these steps.

The research is processes of involve a number of inner related activities, which overlap and
rigidly follow a particular sequence.

It consist of following steps

Formulating the objective of the study.
Designing the methods of data collection.
Selecting the sample plan.
 collecting the data
Processing and analyzing the data
Reporting the finding

Steps in Research Methodology

OBJECTIVE OF STUDY

VE OF STUDY
RESEARCH DESIGN
DATA CLLECTION
SAMPLE DESIGN
DATA ANALYSIS
REPORTING OF FINDING
An exploratory research focuses on the discovery of ideas and is generally based on secondary
data. It is primarily investigation which does not have a rigid design. This is because a researcher
engaged in an exploratory study may have to change his focus as a result of new ideas and
relationship among the variables.
Analysis and Interpretations

Finance and accounts department

Money or capital being a scare as well as crucial resource in the working of any organization
needs to be given prime importance. The financial resources have been planned and controlled in
a proper and continuous manner. As among the most crucial decisions of a firm are those that
relate to finance. Finance and accounts from an integral part of any organization proper and
smooth functioning of this section is very vital for the organization to survive and grow.

Finance functions are of two types:

Managerial finance function
Routine finance function

Managerial finance functions require skillful, planning, control, and execution of financial
activities.
Routine finance functions do not require a great managerial ability to carry them out. They are
chiefly and incidental to the effective handling of the material finance functions.
Role of the finance management
Finance is lifeblood of business thats why the finance function assumes more significance
because it plays important role in successful performance of all operational and managerial
function through there are other basic function also like production, marketing etc.
The industrial development of the last 60yrs or so has made finance and financial management
an indispensable part of business management.

A firms success and even survival, its ability and willingness to maintain production and to
invest in fixed or working capital are to a very considerable extent determined by its financial
policies, both past and present. In fact the financial manger is now being placed at central focal
point of modern corporate organization due to organizational changes and revolutionary changes
in financial management.
Financial management is viewed properly viewed as an integral part of overall management
rather than as a staff specialty concerned with production, marketing and other functions with in
an enterprise wherever decisions are made about the acquisition or distribution of asset.
It is often said that now a days, financial management watches and cases various development
activities liquidity and profitability of the firm.
Few activities to be cased for:
High cost of financial the risky investment due to capital-intensive environment.
Diversification by the firm of various business, markets and products.
A high rate of inflation affecting firms forecast and planning.
Technological changes at high speed & need for more expenditure on R & D.
Flow of information at rapid speed causing the use high-speed computers.
Last but not least, the sound financial decisions not only affect the production and
distribution but also affect the organizations profitability and liquidity.
Financial statement analysis
Financial statement provides a view of the financial position and operation of the firm. The focus
of financial analysis is on key figures in the financial statement and the significant relationship
that exist between them.

The analysis of financial statement is a process of evaluating the relationship between

components parts of financial statements to obtain a better understanding of the firms
position & performance.

Steps of financial analysis

To select the information relevant to the decision under consideration from the total
information contained in the financial statement.
To arrange the information in a way to highlight significant relationship.
To interpret & draw inference &conclusion

 RATIOS ANAYLSIS

Ratio analysis is a widely used tool of financial analysis. It may be defined as the systematic use
of ratio to interpret the financial statement so that the strengths & weaknesses of the firm as well
as historical performance and current financial condition can be determined. Here, the term ratio
refers to the numerical or quantitative relationship between two items/ variables, which are
connected with each other in some manner. Ratio analysis makes the related information
comparable.

Ratio may be expressed in either of the following ways:

In proportion: - in this form the amounts of the two items are being expressed in a
common denominator.
E.g.- current ratio as 2:1

Quick ratio as 1:1

In times of coefficient: - in this form, a quotient obtained by dividing one item by another
item.

E.g.- 6times is the ratio between sales & stock.

In percentage: - in this form, a quotient obtained by dividing one item by another is

multiplied by 100 & becomes the percentage form of expression.
E.g.- Relationship between gross profit & sales may be expressed as 25%
 Financial analysis of B. L. Agro oils ltd.

Profitability ratio:-
Operating profit ratio
= operating profit / sales * 100
= 467928770.37/4212526565.03*100
= 11.108
= 395052176.04/3540722900
= 11.157

Operating profit = gross profit + depreciation + Interest other income

(Year 2010-2011) = 353896723.40+ 49681199.16 +72863059.81 - 8512212.00

= 467928770.37

(Year 2009-2010) = 305585893 + 42734324.00 + 47318871.04 - 586912.00

= 395052176.04

Operating ratio Operating ratio establishes relationship between the cost of good sold,
and the other operating expenses and sales. The other operating expenses include the cost
of goods, administrative expenses, and financial expenses, selling expenses. The costs of
goods are also known as direct operating expenses. Operating ratios are generally
expressed in percentage;
Operating ratio = Cost of sales + other operating expenses / sales
(Year 2010-2011) = 3858629841.63 +146035126.94
= 4004664968.57/4212526565.03
= 0.951
(Year 2009-2010) = 3235137007 +139424585.86
= 3374561592.86/3540722900
= 0.953
 Cost of good sold = (Total sale - GP)
(Year 2010-2011) = 4212526565.03 353896723.40
= 3858629841.63
(Year 2009-2010) = 3540722900 305585893
= 3235137007
Gross profit ratio Gross profit ratio measures the relationship of gross profit to net
sales is usually represented as a percentage. It is calculated as:

Gross profit ratio = G.P / net sale * 100

(Year 2010-2011) = 353896723.40 /4212526565.03*100
= 8.401% (year 2010-2011)
(Year 2009-2010) =305585893/3540722900*100
= 8.631%
Net sales = total sales sales return
(Year 2010-2011) = 4212526565.03 0
= 4212526565.03
(Year 2009-2010) = 3540722900 0
= 3540722900

Net profit ratio: Net profit ratio is also called net profit to sales ratio (profit margin).
Profit margin is indicative of the managements ability to operate the business with
sufficient success not only to recover from the revenues of the period, the cost of
merchandise or services, the expenses of operating the business and the cost of borrowed
funds, but also to leave a margin of reasonable compensation to the owners for providing
their capital at risk. Higher the ratio of net operating profit to sales better is the
operational efficiency of the concern.

Net profit ratio = N.P / net sales * 100

(Year 2010-2011) = 95589988.13/4212526565.03*100
 = 2.269%
(Year 2009-2010) = 49440062/3540722900*100
= 1.410 %

5. Return on capital employed - It is also return on investment or rate of return.

It indicates the percentage of return on the total capital employed in the business.
It measures the profit, which a firm earns on investing a unit of capital the return on
Capital expresses all efficiencies or inefficiencies of a business.

Return on capital employed = PBIT / capital employed * 100

(Year 2010-2011) = 200520420.06 / 969095600.45*100
= 20.691%
(Year 2009-2010) = 123933397/776208704*100
= 15.966%
Capital employed = total assets current liabilities
(Year 2010-2011) = 1329257685.72 - 360162085.27

= 969095600.45

(Year 2009-2010) = 973913721- 197705017

= 776208704

(Year 2010-2011) Total assets = fixed assets + current assets + investment

= 451232774.11 + 863953120.61 + 14071791.00

= 1329257685.72
(Year 2009-2010) =351748239 + 617977315 + 4188167
= 973913721
 (Year 2010-2011) PBIT = PBT + interest
= 127657360.25 + 72863059.81

= 200520420.06
(Year 2009-2010) = 76614526 + 47318871
= 123933397

6. Profit After tax to sales The ratio expressed the relationship between profits
After tax and sales.

Profit after tax to sale = PBT / sale * 100

(Year 2010-2011) = 127657360.25 / 4212526565.03*100
= 3.030
(Year 2009-2010) = 76614526/3540722900*100

=2.163

Activity Ratio
Stock turnover ratio: stock turnover is also known as inventory ratio merchandise
turnover ratio or stock velocity ratio. This ratio measures the number of times the stock
turns, flows or rotates in an accounting period compared to the sales effected during the
that period. It indicates the frequency of inventory replacement, i.e. the number of times
the inventory has been sold and replaced during the given period of time.

Stock turnover ratio = cost of goods sold / average stock

(Year 2010-2011) =3858629841.63/790749120.8/2
= 3858629841.63/395374560.4
= 9.759
 (Year 2009-2010) = 3235137007/561860002.95/2
= 3235137007/280930001.47
= 11.516

Debtors turnover ratio: It is also known as turnover of debtors ratio and accounts
receivable turnover ratio. This ratio attempts to measure the collectability of debtors and
other account receivables. It shows the rate at which the trade debts are being collected. A
firm sells goods on credit and cash basis. Debtors are expected to be converted into cash
over a short period and thus, included in current assets. Financial analysis employee two
ratios to judge the quality or liquidity of debtors: Debtors turnover and average
collection period. It measures the number of times the receivable rotate in a year in terms
of sales.
Debtors turnover ratio = sales / average receivable
(Year 2010-2011) = 4212526565.03/98300928.1105
= 42.853
Average receivable = 196601856.21/2
(Year 2009-2010) = 3540722900/146364114.69
= 24.191
Average receivable = 292728229.38/2
= 146364114.69

Working capital turnover ratio- It reveals the efficiency with which

Working capital has been utilized by a concern.

Working capital turnover ratio = cost of goods sold / working capital

(Year 2010-2011) = 3858629841.63/503791035.34
= 7.659 times
(Year 2009-2010) = 464037007/420272298
=1.104 times

Working capital = current assets current liabilities

 (Year 2010-2011) = 863953120.61 - 360162085.27
= 503791035.34
(Year 2009-2010) = 617977315 - 197705017
= 420272298

Capital turnover ratio sometimes the efficiency and effectiveness of the operation is
judged by comparing the sales with the amount of capital invested in the business.
Capital employed is either equal to shareholders fund plus long-term loans or equal to
total assets minus current liabilities. This is calculated by establishing the relationship
between sales and capital employed.
Capital turnover = sale / capital employed
(Year 2010-2011) = 4212526565.03 / 969095600.45
= 4.346 times
(Year 2009-2010) = 3540722900 / 776208704
= 4.561 times
Capital employed = total assets current liabilities
(Year 2010-2011) = 1329257685.72 - 360162085.27
= 969095600.45
(Year 2009-2010) = 973913721-197705017
= 776208704

Assets turnover ratio:- Assets turnover ratio shows the relationship between total assets
and sales of concern.

Assets turnover ratio = Net Sales/Total assets

(Year 2010-2011) = 4212526565.03/1329257685.72

= 3.169 times
 (Year 2009-2010) = 3540722900 / 973913721
= 3.635 times

Total assets = fixed assets + current assets + investment

(Year 2010-2011) = 451232774.11 + 863953120.61 + 14071791.00
= 1329257685.72
(Year 2009-2010) =351748239 + 617977315 + 4188167
= 973913721

I. Current assets turnover ratio - Current assets turnover attempts to measures the utilization
and effectiveness of the uses of current assets or state over investment or under investment in
current assets. It may be pointed out that over and under investment in current assets may
indirectly affect the solvency of the concern. Its the ratio between costs of sales and currents
assets.

Current assets turnover = sales / current asset

(Year 2010-2011) = 4212526565.03/863953120.61
= 4.875 times
(Year 2009-2010) = 3540722900/617977315
= 5.729 times

II. Fixed assets turnover ratio this ratio assumes added significance in the case of
manufacturing concern an increase in this ratio is the indicator of efficiency in work-performance
and decrease in this ratio speaks of unwise and improper investment in fixed assets.

Fixed assets turnover ratio = Net sales / Fixed assets

(Year 2010-2011) = 4212526565.03/451232774.11

 = 9.335 times
(Year 2009-2010) = 3540722900/351748239
= 10.066 times

Financial ratio

Currents Ratio- The ratio of current assets to current liability is called current ratio. This
ratio is an indicator of the firms commitment to meet its short-term liabilities. Current
assets include cash and other assets convertible into cash during the operating cycle of the
business. Current liabilities mean liabilities payable within a years time. An idle current
ratio is 2:1, the ratio of 2 is considered as a safe margin of solvency. A very high current
ratio would indicate the less efficient use of funds while a poor current ratio is a danger
signal to the management.

Current ratio = current assets / current liabilities

(Year 2010-2011) = 863953120.61/ 360162085.27
= 2.398: 1
(Year 2009-2010) =617977315/197705017

=3.125: 1

Current Assets = Stock + Sundry debtors + cash + loan &advances

(Year 2010-2011) = 559090945.36 +196601856.21 + 9462985.67 +

98797333.37
= 863953120.61
(Year 2009-2010) = 231658175 + 292728229 +16220352 + 77370559
= 6617977315
 Current liabilities = Creditors + Current Liabilities for Others + Provisions

(Year 2010-2011) = 152223025.00 + 174561631.27+ 33377429.00

= 360162085.27
(Year 2009-2010) = 68151089+101543687 +28010241
= 197705017

Quick ratio This ratio is also called acid test ratio and liquidity ratio. This ratio is
ascertained by comparing the liquid assets to current liability. The idle ratio is 1. This
ratio is also an indicator of short-term solvency of the company. A comparison of current
ratio to quick ratio will indicate the inventory hold-ups. For example, if two units have
same current ratio but different liquidity ratio, it indicates over stocking by the concern
having low liquidity ratio as compared to the concern, which has a higher liquidity ratio.

Quick ratio = liquid assets / current liabilities

(Year 2010-2011) = 304862175.25 / 360162085.27
= 0.846: 1
(Year 2009-2010) = 386319140 /197705017
= 1.954: 1

Liquid assets = Current assets (inventory + prepaid exp.)

(Year 2010-2011) = 863953120.61- (559090945.36 + 0)
= 304862175.25
(Year 2009-2010) = 617977315 (231658175 + 0)
= 386319140

Cash ratio This is the ratio between cash and balances to current liabilities. As such
Cash ratio = Cash + bank / current liabilities
 (Year 2010-2011) = 9454306.00 + 8679.67/360162085.27
= 9462985.67/360162085.27
= 0.026: 1
(Year 2009-2010) = 16220352/197705017

=0.082:1

Solvency ratio This ratio highlights upon the long-term solvency of the concerned and
is ascertained by the formula
Solvency ratio = Total assets / Total liabilities
(Year 2010-2011) = 1329257685.72/979021639.01
= 1.358

(Year 2009-2010) = 973913721/724150419.01

= 1.345

Debt equity ratio - The debt equity ratio is determined to ascertain the soundness of
long-term financial policies of the company. It is also known as external and internal
equity ratio. This ratio establishes the relationship between the internal equities and
external equities. If this ratio is 1:1, the long-term financial position of any business
concern is considered satisfactory. If this ratio is lower than 1:1, it means that outside
liabilities are lower than shareholders fund and in this case financial position will be
considered more good and satisfactory.

Debt equity ratio = long term debt / shareholders funds

(Year 2010-2011) = 618712496.74/336806671.63
=1.837
(Year 2009-2010) = 470403900.01/250024302.45
=1.881
 a)Table form
b)Graphical

Profitability ratio. 2009-2010 2010-2011

Operating profit ratio 11.16% 11.11%
Operating ratio 0.95% 0.95%
Gross profit ratio 8.63% 8.40%
Net profit ratio 1.41% 2.27%
Return on capital employed 15.97% 20.69%
Profit After tax to sales 2.16% 3.03%

2009-
Activity Ratio 2010 2010-2011
Stock turnover ratio 11.516 9.759
Debtors turnover ratio 24.191 42.853
Working capital turnover ratio 1.104 7.659
Capital turnover ratio 4.561 4.346
Assets turnover ratio 3.635 3.169
I. Current assets turnover ratio 5.729 4.875
II. Fixed assets turnover ratio 10.066 9.335
Financial ratio 2009-2010 2010-2011
Currents Ratio 3.125 2.398
Quick ratio 1.954 0.846
Cash ratio 0.082 0.026
Solvency ratio 1.345 1.358
Debt equity ratio 1.881 1.837
 Findings of the study

Based on the above financial analysis it is clear that Quick ratio of B.L. Agro oils ltd is
more than 1 i.e.1.594 in 2009-2010 and less than in.846 in 2010-2011.

Debt-equity ratio of B.L. Agro oils ltd is very less which means that B.L. Agro oils ltd
has not been aggressive in financial its growth with debt. The company has better support
from the shareholders.

In B.L. Agro oils ltd collection period is very quick i.e. 9days.

During my visit I observed that there is no more wastage of raw material ,

Inventory management in B.L. Agro oils ltd is effective & efficient.

Through the financial analysis it is find that the return on capital employed is 20.691%
To meet the challenges of growing demands, B.L. Agro is preparing for capacity
enhancement and expansion of manufacturing capabilities.
The company has an ambitious plan for setting up an Integrated Oil Complex for which it
has already identified the locations. With comprehensive facilities available within this
complex, the company will be able to provide integrated solutions and enhance its
competitive pricing power.
In addition to the existing facilities, the proposed complex will include Solvent
Extraction Plant, Rice Bran & Sunflower Refinery and Mustard Crushing Facilities.
To make its procurement processes smooth and cost effective B.L. Agro oils is also
contemplating setting up of Rack Facilities connecting its Oil Complex to various Port.
With the addition of Mustard Crushing Facilities, the company plans to consolidate as
well as increase its market share in the mustard segment.
The company is working to expand its product and brand portfolio through extension of
the existing lines as well as through diversification into other edible food items.
 Through ensuring a substantial market share in the mustard oil as well as other segments,
B.L. Agro aims to obtain better pricing power.
Expansion in geographic reach and newer markets - The company has already extended
its distribution network covering almost entire North India and is now poised to further
expand in newer markets.
The company has an Excellent Track Record With the Management experience of 50
years, B.L. Agro has displayed a consistent and exemplary growth right since its
inception.
B.L. Agro Oils Ltd. possesses India's largest mustard oil packaging facilities.
In-house QC Lab Best equipped & biggest in UP. The company has an in-house Quality
Control Laboratory with a Gas Chromatography that ensures purity, ideal blends and PFA
certified quality of all B.L. Agro products.
The company's lab is the biggest and best equipped in the entire state of Uttar Pradesh.
The processes and facilities at the B.L. Agro plant match the highest standards The
Double Filter Process for Mustard Oil ensures that only the purest product is dispatched
from the B.L. Agro plant.
The Refining is undertaken by Chemical Refining process through which flows out the
purest form of cooking oil that beats the best known brands on transparency tests.
Moreover, the oil is processed using the Nitrogen Blanketing process that reduces the loss
of nutritional values and ensures Maximum Nutrition Retention (MNR) in the Refined
Oils.
The financial position of Khandelwal Edible is much better because company earns a
good profit in 2009-2010 gross profit ratio is 8.63% and in 2010-2011 it is 8.40% .
The net profit ratio is find out of B.L. agro oils ltd in 2009-2010 is 1.421% and in 2010-
2011 it is 2.27%.

BIBLIOGRAPHY

BOOKS/MAGAZINES:

Marketing Management by Philip Kotler

Marketing Management by Shrma,Kothari

Economic Times.

Data gathered from Broachers.

Business World

WEBSITES:

http://www.google.com

http://www.blagro.org