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Gohar Textiles Pvt. Ltd.

Waqar Khan

For the degree of Master of Commerce


Department of Commerce
Government College University

Copy right by Waqar Khan 2010


All praises and thanks to Almighty Allah. The Lord and Creator of this universe by
whose power and glory all good things are accomplished. He is also the most merciful,
who best owed on me the potential, ability and an opportunity to work on this project.

I am grateful to my respected teacher Sir Sana Ullah who has guided me in each
and every step of this project. Indeed, without her kind guidance I may not be able to
even start this project. May ALLAH give her the reward which she deserves. I am also
grateful to all those members who are related to Gohar Textile Pvt. Ltd.

Despite of the most hectic schedule, Sir. Mustajab (manager Finance) helped me
so much. I'm really grateful to you Sir for clarifying my concepts and making me learn
from your experience. Whatever I learnt from you will definitely help me in my
upcoming study and the professional life ahead. Thank you so much for being so co-
operative and so helpful every time. I hope Sir I have been up to your expectations.

In the end, I am thankful to all my teachers and have a lot of prayers for them who
give me the knowledge and make me able to complete my master’s degree. Here I have
special thanks for Sir Sana Ullah whose supervision guided me to complete my final

Waqar Khan


“I dedicate my projects efforts to my PARENTS and respected

TEACHERS who taught and hold my hands on every step of my life.


1.1 Vision of Textile Industry of Pakistan
1.1.1 Vision of Textile Industry:

An open market driven, innovative & dynamic Textile Sector, which is: -

I. Internationally Integrated
II. Globally Competitive
III. Fully equipped to exploit the opportunities created by the MFA Phase out and this
enables Pakistan to be amongst the Top Five Textile Exporting Countries in Asia.
While going through the draft summary report on Textile Vision 2005, the first and
immediate response is that after a long time a sincere effort has been made to revamp
textile industry in Pakistan. The enabling backdrop was termed a vital pre-requisite to the
viability of the strategy. Some of these factors are not controllable and there is still very
heavy reliance on the GOP support/incentives. Unless the industry is able to stand on its
own feet firmly, without the crutches of incentives/protection, it will be very difficult to
compete in the global markets.
The draft of Textile Vision 2005 was circulated after the stakeholders of the textile sector
attended the presentation of the strategy on April 14, 2000. This formed the basis of the
final deliberation. However, the document, in no way, represents the final policy
proposals to the GOP by the Textile Sub-committee chaired by Tariq Sayeed Saigol.
Three different scenarios have been suggested for the strategy

1.2 Three scenarios of Textile Industry

1.2.1 Low road

I. Exports will maintain the historic growth rates

II. There will be no change in the product or the market mix

1.2.2 Do-able

I. Exports growth rate will match each importing country's growth rate of
unit imports

II. Unit exports of garments to Middle East market will grow at 3 per cent
III. Pakistan will capture 0.5 per cent share in the Japan and Hong Kong
IV. Unit price of cotton yarn will grow at 3 per cent and that of fabrics will
grow at 4 per cent annually
V. Share of 100 per cent synthetic garments in the garments exports will
increase from current 3 per cent to 30 per cent, in line with the world trend
VI. 13 million bales of cotton will be consumed

1.2.3 High road

I. Value added products (garments and made-ups) will be the engine of export
growth (20% annually)
II. Export product mix will be balanced by giving extra push in the women and
woven garments
III. Fabrics exported will contain 55 per cent processed fabrics
IV. Total cotton production will be 16 million bales of which 13 million will be

Three different scenarios viz, Low Road-Do-able, High Road scenarios have been
proposed for the strategic development of the Textile Industry to give a quantum jump in
the export of textile products. An investment of approximately 5.00 Billion Dollars has
been proposed for the next four years time to achieve a minimum growth rate of 12% on
present export base.
1.3 Introduction of Textile Industry
Looking at the world as a whole a new and dramatic global order had emerged since the
end of the cold war, and is continuing to develop into the new century. Europe and North
America, and N.A.F.T.A. respectively illustrate the growing trend to create regional
economies. It is Asia however that is attracting global attention as the most dynamic
growth region in the world today and is likely to drive the world economic development
as we further move through the time.

Despite of the tendency towards re-location, most developed countries have nevertheless
succeeded in maintaining a local textile industry, which is both viable and competitive at
international level. This is mainly due to their unprecedented efforts at modernizing and
restructuring the production process. The textile industry in developing countries has
increasingly placed emphasis on quality, the rapid response to growing demand and
innovation in the areas of fibers (micro fibers) and high value-added textiles (industrial
The Textile Industry all over the world is trying to consolidate through re-adjustment
strategy. The markets have become very competitive. There is a fierce competition
amongst the low cost producers mostly in Asia to take up the share being lost by high
cost European Manufacturers.
Pakistan has to compete with countries, which are similar in factor conditions and
comparative advantages. The close competitors are India, China, Turkey and Indonesia,
now a days Bangladesh is emerging a close competitor in this sector. Due to cotton price
edge the Indian Textile Industry had been able to compete us in our traditional yarn and
cloth markets.
These market changes are developing pressure on our Textile Industry and the industry is
in the process of transition for a structural change to rebuild its competitiveness. Such
structural changes are always painful. The industry in general is not in a comfortable
position. Further the declining profitability has aggravated the credit access problems and
ability to finance new investment, which is so important for improving quality and
productivity. Excepting few cases no attention has been given to skill development both
in manufacturing and marketing. Lack of product diversification and passive selling has
kept industry to low market segments with earnings depressed.
1.4 History of Textile Industry of Pakistan

Increase in the cotton production and expansion of textile industry has been impressive in
Pakistan since 1947. Cotton – bales increase from 1.1 million bales in 1947 to ten million
bales by 2000. Number of mills increased from 3 to 600 and spindles from about 177,000
to 805 million similarly looms and finishing units increased but not in the same
proportion. It employs 50% of industrial labor force and earns 65% foreign exchange of
total exports. Pakistan’s textile industry experts feel that Pakistan has fairly large size

textile industry and 60-70% of machines need replacement for the economic and quality
production of products for a highly competitive market. But unfortunately it does not
have any facility for manufacturing of textile machinery of balancing modernization and
replacement (BMR) in the textile mills which need to think about joint ventures for the
production of complete spinning units with china, Italy and production of shuttle less
looms (Projectile) with Korea, Taiwan and Italy.

Cotton textile industry has been premier industry in Pakistan and a major source of export
earning and employment. It also helps in value addition to the manufacturing sector of
the economy. During the six years between 1993 and 1998, production of yarn (in
quantity terms) registered a steady annual growth rate of 302% in Bangladesh and 405%
in India.

On the contrary, Pakistan registered a growth rate of 101% per annum in yarn production
although it ranked third after China and India in the global yarn production during the
same six years. In exports, while Taiwan, India and the republic of Korea registered an
annual increase of 18.1%, 27.7% and 5.4% respectively during 1993-1998, Pakistan
registered a negative growth of 4.8% one important development was that till 1997,
Pakistan was the world’s largest exporter yarn followed by India.

However, in 1998, India gained the NO 1 position, leaving Pakistan at NO 2 In the case
of cotton cloth production, a number of Asian countries have been emerging in the
international market to compete with Pakistan. These countries are Bangladesh, India,
Taiwan, Indonesia, Thailand, Turkey, Sri Lanka and Iran. The above-mentioned
presentation in the context of international scenario highlights the adverse position of
Pakistan’s textile industry when is likely to continue further following the full
implementation of WTO agreement from 2005 onwards when an era of free trade will
start globally. Notwithstanding the above fact, current stagnation in the local textile
industry can be overcome through efforts, consistent with charges occurring in the
international market.

It must be appreciated that all successive governments since the birth of cotton textile
industry in Pakistan have been encouraging the textile exporters to penetrate into new

market and also to broaden the base of exportable commodities by including value added
textile goods so that reliance on exports of cotton, cotton yarn and coarse fabrics
gradually become minimal.

Reflecting on the state of affairs, Abid Chinoy, Pakistan cloth merchants Association
(PCMA) Chairman, Appreciated government’s efforts to encourage new exports and
finding new markets, which need aggressive export marketing. The steps taken on the
monetary front, such as the frequent devaluation of Pak rupee in terms of dollar could not
improve the cost competitiveness of exportable products due to increase in prices of the
local and imported inputs of the local textile industry, and also due to inelastic demand
for the Pakistan’s exports.

It has been rightly mentioned in the latest stage bank of Pakistan’s annual report (FY01)
that, “Over the years Pakistan’s exports receipts have been vulnerable on account of the
narrow base of exportable items, concentrated markets and low value addition ‘this
indicated that the growth in the country’s overall exports, including textile products
which contributed more then 60% of total export receipts each year, could to be related
some cosmetic and ad hoc measure like devaluation of Pak rupee and concession export
credits. The first textile commission, which was constituted by the first material law
government in 1960 had, inter-alia, recommended that an economic size textile unit
should preferably have 25,000 spindles and 500 looms. No new mill with only 12,500
spindles and without looms should be sanctioned. However, no need was paid to the
advice by the sanctioning authorities with the result that an excess capacity had tented to
build up in the spinning sector.

During the period 1973 to December 1992, some 71 spinning units with 1,136, 835
spindles, 6,600 rotors ands 7,329 looms were closed down. In 1992, a foreign consultant
form was hired by the government to look into the stagnating conditions in the local
textile industry. One of the observations of the foreign consultant was “Pakistan has
failed to make real progress in the international market and is being over taken by many
of the neighboring competitor countries. The spinning sector, traditionally the core of the
industry, is already in the crisis with many spindles lying idle and mills being forced to

close. Worse still, this sector will be hit by the projected decline of its major markets in
Japan and Hong Kong in the coming years.”

Another important strategic recommendation given by the foreign consultant very much
relevant to the current conditions: “It is vital that companies play very positive role in the
markets, which each one having its own marketing activity, whose job is to understand
the need of the customers and the ever changing competitive dynamics of the markets. In
order to improve exports, Pakistan’s Readymade Garments Manufacturers and Exporters
Association (PRGMEA) has urged the commerce minister Abdul Razzak Dawood to set
up an Apparel Board for the promotion of export of woven and kit garments which fetch
US$ 2.5 billion foreign exchange for the country.

The industry experts are of the opinion that in the order to have a strong industrial base,
Pakistan economy need investment upswing. Pakistan’s economic growth performance
during recent years has been dismal: as against the average growth rate of 6.1% in the
1980s, the half and 4.0% in the 2nd half of the 1990s. The major micro-economic
instability factors like high inflation rate, budgetary deficit, continuous depreciation of
rupee, economic sanctions, etc. could not help the investment process. Such an
environment cannot be conducive to investment and growth.

Exporters of textile products have found the target of US$ 10.4 billion set by the
government for the year 2002-2003, as achievable and termed it a realistic approach. The
textile sector which constituted 69% of total export during 2001-2002, believes that
enhanced quota by the European Union and Turkey would make this possible to fetch
another US$1 billion this year.

The rise in export of value-added products from Pakistan was another point of
encouragement for the textile sector. “The export of value-added products rose to 57.4%
from 53.9% last year-a clear sign that we are moving in the right direction, “said the
Chairman of all Pakistan textile mills association. The trade policy is considered an
acceptable paper, but in the industry does not fine anything that could lead to a high level
exports achievement and remove trade imbalance.

Pakistan’s textile sector earned US$5.77 billion during the outgoing year, compared with
US$5.577 BILLION OF 2000-2001 indicating a growth of 0.69%. “Textile vision 2005”
has identified the present status and opportunities to make in roads in conventional and
hew markets and has developed sectoral recommendations, hence the sectoral committees
set up by the federal textile Board (FTB) would play an important role be ensuring the
availability of quality raw materials on competitive prices and improvement in designing,
and would adopt quality standards and increase productivity levels. It would attract
foreign brands and promote Pakistani brands with world-class standers.

1.5 Structure of Textile Industry

According to IGATEX Pakistan which took place in Karachi, Pakistan’s largest city, and
is slated to return in 2008 that the republic’s textile and apparel industry is consisted of
ginning, spinning, man-made fiber, weaving, finishing, apparel, terry towel, tarpaulin and
canvas, and knitwear machinery sectors? The textile and apparel industry as a whole
employed approximately 40 percent of total industrial workers and accounted for 46
percent of total manufacturing.
There were 1,221 ginning units, featuring an installed capacity of 20 million bales of
cotton. The spinning sector comprised 408 spinning units, with an installed capacity of
157,143 rotors; and 50 composite units, with an installed capacity of 10.1 million
spindles. The country’s 10 man-made fiber units had an installed capacity of 660,000
While the show’s organizers did not detail the number of weaving units in their report,
the Pakistani government’s Board of Investment reported 124 large and 425 small
weaving units, with a total production capacity of 4.4 billion square meters of fabric. The
show report also did not include the installed capacity for the 106 finishing units in the
organized sector and 625 finishing units in the small-scale sector. However, the
investment board noted a total finishing capacity of 4 billion square meters.
With regard to finished textile goods, the country’s 5,000 apparel units featured an
installed capacity of 450,000 sewing machines, show organizers reported. The installed
capacity for Pakistani knitwear manufacturers numbered 12,000 machines. Tarpaulin and
canvas production capacity totaled 100 million square meters, while installed capacity of

terry towels totaled 7,500 looms. In contrast to IGATEX Pakistan’s post-show report, the
International Textile Manufacturers Federation (ITMF), Switzerland, in its 2005
International Textile.

1.6 Structure in disparity with other countries

Machinery Shipment Statistics report, noted the country’s installed spinning capacities —
reported in 2004 — 9.7 million short-staple spindles, 35,000 long-staple spindles and
150,700 open-end rotors. In comparison to other industries in Asia and Oceania,
Pakistan’s short-staple capacity that year ranked third — behind mainland China and
India, in that order — while open-end capacity was fourth — following mainland China,
India and Uzbekistan. Long-staple capacity in the republic came in 11th, tying with
Installed weaving capacities in 2004 reported to ITMF totaled 24,000 shuttle less looms,
225,000 shuttle looms and 50,000 filament weaving looms. The shuttle less capacity that
year ranked sixth among other industries in Asia and Oceania; shuttle capacity was
second, behind Mainland China. Likewise, Pakistan’s filament-weaving capacity came in
second, following Mainland China and tying with Thailand.
On the other hand, the Karachi-based All Pakistan Textile Mills Association (APTMA), a
national trade association promoting 360 textile spinning, weaving and composite mills in
the organized sector, reported the total installed capacity for its member mills numbered
8.8 million spindles, 65,580 rotors and approximately 10,000 looms. There were 292
APTMA spinning mills, 40 weaving mills and 28 composite mills, which featured
facilities that can handle a variety of processes under one roof. Among the products
produced in APTMA mills were open-end and spun yarn; greige, printed and dyed
fabrics; and bed linens.

1.7 Government Initiatives

In 2005, the Pakistani government created a special textile sub-committee in order to

formulate a new textile strategies and policy in the hopes of revamping the textile
industry. The sub-committee submitted a report entitled "Textiles Vision 2005" which
included a number of recommendations including improved product quality, equipment

upgrade, developing human resources, aggressive targeting of new markets and
development of high-powered leadership for the textile sector.

1.8 Exports

Cotton and yarn are Pakistan's primary textile exports. The textile industry accounts for
over 60 percent of Pakistan's total exports. The All Pakistan Textile Mills Association is
the organization that regulates the industry, which is currently facing a number of
challenges, including the need to improve quality.

1.9 Competition

Pakistan must compete with other producers similar in conditions and comparative
advantage. The Pakistani Textile industry's biggest competitors are China, India,
Indonesia and Turkey. The cost of power in Pakistan is comparatively high.


2.1 Introduction
Goar Textile Mills was incorporated in 1993 in the most renowned textile city of Pakistan
i.e. Faisalabad. Ever since its formation it is exporting its total production to the
International Markets.
Gohar Textile Mills (Pvt) Ltd is a group that is expanding from a modest base on a very
consistent & practically enviable growth rate. We are a supply partner for businesses who
value the quality and like to enjoy it on a consistent basis.


GOHAR aims to be a world class textile organization producing diverse range of

products for the global textile market. GOHAR seeks to achieve customer delight through
excellence in manufacturing & customer service based on creative combination of state
of the art technology & human resources. GOHAR is committed to be responsible
corporate citizen

2.3 Organization Profile

Company information
Name :- Gohar Textile Mills (Pvt) Ltd
Chairman and chief executive officer
Ch. Maqbool
Ch. Liqat Ali
Liqat Ali
Gohar Mustafa
Aftab Gohar
Director Operation
Aftab Gohar
Chief finance officer
Sh. Asif
Habib bank Corporate
Alflah Bank
Allied Bank
Head office
208- Chak Road, Zia Town, Faisalabad
3-Km Chak Jhumra Road, Khurrianwala, Faisalabad

2.3.1 Organizational hierarchy chart









2.4 Awards and Achievements

Certified for Currently
ISO 9001: 2000 Certified for Working for the following certifications
Oekotex C-TPAT
WRAP ISO 14000

2.5 Product Line

Gohar Textile Mills produced different high quality export oriented products to the
international market. These are as under.

• Quilts(Comforters)
• Bed linen
• Kitchen linen
• Processed fabrics
• Grieg Fabrics

We are the manufacturers of synthetic hollow fiber filled duvets, pillows and mattress
protectors. Our fibers are processed according to modern-world health & safety

The Variety of patterns that can be quilted is countless. Automatic size and measurement
control feature are built into the machine.
100% product inspection for quality is how we ensure our claim of consistency on high
At Gohar we supply an exotic collection of exquisitely designed bed linen to turn your
bedroom into a paradise of luxurious comfort.
In-line inspection while the product is still on the machine reduces rework cost and time.
Various types of button attachment are available through the specially designed
Here again the 100% of the product is inspected for even the most minute faults or
deviation from the specifications.
At the packing stage the affixing of stickers and their positions are specially observed.

2.6 R&D Department:

In order to achieve and maintain market leadership, we have invested significantly in
extensive research and development facilities to stay abreast of latest trends in print and
fabric confection we get consultation from European designers and even our
representatives visit various top-of-the-line stores in foreign markets regularly. That
market data is then converted into our own registered designs through our R&D
department and is offered to our customers.

2.6.1 Quality Policy

To develop and maintain a consistent quality standard for our customers through reducing
the tolerances to the minimums that are practically possible. We fight and win the quality
war and not the price war.

2.6.2 Quality Assurance/Lab:

The equipments are calibrated after a specific time period to maintain the stringent testing
conditions. Periodic maintenance of individual machines is defined and is carried out
accordingly on time and are monitored through the ISO systemization. Traceability of the

produced article with the machinist and the machine numbers is another feature to have
the quality assured.

Customer standards and procedures are carefully documented and administered through
the merchandizing team.
We have been approved over the years in quality audits by our customers like IKEA,
M&S and others.

2.7 Shipment Efficiency

Critical paths are made and monitored by the PPC department to ensure timely handlings
of the orders.
Critical paths of each order / Job are prepared and are sent to customer so that both the
sides abide by these to achieve timely shipments
2.7.1 Sales Figure

Gohar Textile Mills last year’s annual turnover was US $ 24 Million. This has seen a
consistent double figure growth in the last three years respectively.

2.7.2 Strength

• No outside financing so we can under take big orders for longer periods without
having to think about any financial constraints.
• High Cumulative Customer retention rate since the start of operations
• Sustained growth rate of annual sales turnover.
• Consistent Quality ; Timely shipments

2.8 Major Customer

The industry leaders who are our top four volume customers are,

• IKEA Europe.
• Metro Group Europe.
• Marimac Canada.
• PID Designs Canada

2.9 Exhibition

We are exhibiting at Heimtextil Frankfurt for the last 10 years. Our Stand No is Hall
10.1 B 70 for the year 2008-2009 Show


III.1 Business Operation
In any textile following are the elements of a business operation

• Spinning

• Weaving

• Grey Room

• Processing

• Singeing

• Desizing

• Scouring

• Bleaching

• Printing

• Dyeing

• Finishing

• Folding

III.2 Spinning Department:

Gohar Textile Mills (Pvt) Ltd has two spinning units situated in Faisalabad. These units
are equipped with the latest machines in all of their departments. In the spinning units the
fiber is converted into yarn, and as this the quality of yarn is very important in the textile
sector so spinning units have a lot of importance.
Generally the spinning mills mechanism is very similar. It starts from the mixing
department where the bales of cotton are mixed and at that section the most visible

impurities are taken out. This mixed cotton is then taken to the blow room by a machine.
After going through a process it is taken to the card room for the next process.
After the card room the route is taken by keeping in view that whether carded yarn is the
end product or the combed yarn. The combed yarn is of better quality and its process is a
bit bigger than the other one.
For the carded portion the drawing breakers & drawing finishers are used to prepare the
fiber to a certain level so that the process on the simplex machine can be carried out. On
the other hand, in the combed portion, after the drawing breaker the cotton goes through
the lab former, & after that it goes through the combing machine, where the comber nail
and comber sliver are separated.
The comber sliver, after passing through the PC drawing & Drawing finisher goes to the
simplex machine. The product that comes from the simplex machine is then taken to the
Ring section where the yarn is to be made. Finally after passing through the auto cone the
yarn comes in the packing department. In Gohar the process of Ultra Violet Checking is
also practiced to ensure the quality of the yarn.
As this process is very important so there are some common parameters on which the
quality of yarn is judged. These parameters have been listed as below:

III.2.1 Important Parameters of Fiber:

• Length

• Strength

• Micronaire value

• Color grade

• Neps / gram

• Trash percentage

III.2.2 Important Parameters of Yarn:

• Yarn count

• Strength LCSP

• U percentage

• Thin Places

• Thick Places

• Neps

• IPI (Imperfection)

III.3 Weaving Department:

The weaving units are really very well equipped with the latest machinery to make the
best possible product for the customer to gain the customer satisfaction.

Most of the machines in the weaving unit are of new technology & mill has a very good
check on the quality of fabric produced by its Quality Control department.

The end product of the spinning unit is the starting point of the weaving unit. When the
cones of the yarn are brought to weaving unit, it is then taken to the warping zone in
which the beams are prepared.

These beams are then taken to the sizing section where the different chemicals are
applied to the yarn so that the weaving of the fabric can be done with the minimum
breakage of yarn. After sizing the process of drawing inn is applied so that the yarn could
be converted into fabric.

After the drawing inn the beams of the yarn is then taken to the Sulzer Looms so that the
yarn is converted into the weave product. When the greige is made, then it is taken to the
inspection department, where a lot of quality check is done. At the first step the fabric is
classified into two types, i.e. A grade & D grade.

The D grade fabric is either used in the B grade sale or in gathering of the fresh pieces.
While the process of A grade fabric is a bit longer.
The A grade fabric after mending, goes to the checking machines, from where it is taken
to the rechecking machines. After rechecking either the greige is rolled or folded &
packed according to requirements of the buyer.

During all the above process, quality is the main purpose of the people. The weaving
units check the product quality as under:


Air Jet:
Tsudakoma Air Jet 24 machines of 130”
Sulzer Air Jet L5100Model: 20 looms of 110” & 28 looms of 130”
Tsudakoma Zax Air Jet 24 machines of 134”
Total: 96Looms
Production capacity 800,000 Meters a month.

Sulzer Shuttless:
Sulzer PU Model
32 loom of 153”
10 loom of 130”
8 loom of 110”
Total: 50Looms
Capacity: 200,000 Meters a month.
26 machines of 76"
26 machines of 105"
48 machines of 116"
Capacity: 1,400,000 Meters a month. Power:
64 machines of 72"
24 machines of 96"

150 machines of 108"
Capacity: 1,000,000 Meters a month
64 machines of 72"
24 machines of 96"
150 machines of 108"
Capacity: 1,000,000 Meters a month
III.4 Quality Control Department:
First of all the people of Gohar checks the quality of yarn before taking it into the
process. Following are the yarn characteristics that are checked before taking it into the
• Count Testing

• Strength Testing


• Hairiness Testing

• Thick & Thin bases

At the warping section the following characteristic is checked:

• Breakage Report

When the sizing process is applied, the following two tests are applied:
• Abrasion Test

• Strength Test

After completion of the greige the gsm test is applied so that to have the best customized
product. Finally in the folding section checks are applied at every step of the folding

III.4.1 A few of the main testing equipment’s that we have available at our lab are:

1. Data Color 650 Series Model 2006

2. HT Dyeing Machine
3. Lab Dyeing Padder
4. Crock Meter
5. Nu Martindale Pilling tester
6. Fume Cabinet
Three lot samples from minimum every 3000M is taken and is tested for
construction, composition, count, GSM, Tegwa, Absorbency, pH, Pilling,
Whiteness, Wet and Dry washing and rubbing results. All these results and then
logged for order history and for improvement in future handlings

Confectioned (Non Filled)
Sheet Sets. 200,000 sets a month
Curtains. 100,000 pairs a month
Other Products whose production levels vary are Kitchen Linen. (Complete Range)
Pillow Shells.
Sofa Cover.

Confectioned (Filled)
Quilting. 120,000 pieces a month
Pillows. 50,000 pieces a month
Chair Pads. 30,000 pieces a month

III.5 Processing Department:

Processing Unit of every textile mill has a paramount importance because it actually
provide the finish fabric product which is either sent to customer either as a piece good or
as made up after converting the fabric into the required stitched product. The processing
unit of Gohar comprises of the following department:

Ø Bleaching Department

Ø Finishing Department

Ø Printing Department

Ø Dyeing Department

Ø Folding Department

Ø Quality Control Lab

Ø Digital Design Studio & Engraving Department

Ø Sample Room

Ø Production & Planning Department

III.6 Bleaching Department:

The bleaching department of Gohar is equipped with the latest machinery to compete
with the market. Bleaching department has the following machines:

Ø Singeing & De-sizing:

Ø Water Mangle:

The above are the machines & a very brief overview of the machines. The bleaching
department is like a back bone of the processing unit. After weaving mill, the fabric is
brought to the bleaching department where it is prepared on the above machines so as to
be prepared for the Printing or Dyeing.
Current capacity:
Current capacity of bleaching is 70,000M per day and another 60,000M per day capacity
has been added since December 2006. All our bleaching method is Hydrogen Peroxide

The Quality Control people ensure the Quality of work in the Bleaching to fulfill the
collective goal.
III.7 Printing Department:
The Printing department of Gohar is well established. It has one latest rotary. It is a
Reggiani 2005 Model Machine. It has 15 color options. Working width is 3.2 Meters and
the capacity is 40,000M per day. We are able to do the three standard design repeats
(namely 640mm, 819mm, and 914mm). The mesh categories that we can do are 80, 125
and 165.

The Printing department of Gohar is working at its best & producing really good stuff.
After the printing from the rotaries, the route of the fabric depends on the dye class.

If the reactive dyes have been used, then the fabric will be taken to first of all Ager
Machine & then Goller Soaper Washing, then to Stenter finish & finally to the calendar.

On the other hand the fabric treated with pigment dye is taken to the curing machine &
from there it is taken to the calendar after the required stenter finish. Now in the
following line, we’ll see the specifications of the Curing & Ager Machines:

Ø Curing Machine:

Ø Ager & Curing Machine:

III.8 Curing Department:

Our Curing machine is equipped with Thermo-Oil Boiler and it has the daily capacity of
III.9 Finishing Department:
Finishing department of any textile mill has a very significant importance because it acts
like a hub in the Processing. Almost every fabric which goes through processing unit, it
has to be passed through the finishing department.

The finishing department of Gohar Processing unit is famous for its quality work. It
comprises of many latest machines which includes Stenters, Cylinders, Raising Machines
& Sanforizing Machine.

Types of Finishes:

There are two major types of finishes:

Ø Chemical Finishes

Ø Mechanical Finishes

The finishes in which no chemical is used is called the mechanical finish, a very good
example of mechanical finish is Calender Finish. On the other hand the finishes through
stenter are known to be the chemical finish. The finishes are of the following types:

Ø Normal Soft

Ø Super Soft

Ø Chintz

Ø Anti Pilling

Ø Anti Wrinkle

Ø Water Proof

Ø Easy Care

Ø Soil Repellent

Sanforizing Machine:

The Sanforizing machine is used for relaxing the shrinkage of warp. The machine
possessed by Gohar has a workable width of 114”. It is basically used either on customer
demand or in case of Garments. The standard is 5%. Gohar has one Sanforizing machine
in its processing unit.

Raising Machine:

This basically means to raise the fibers from the surface of the fabric. The machine
possessed by the finishing department of Gohar has a workable width of 114”. Gohar has
one raising machine in its processing unit.
III.10 Calendaring Department:

Rameisch Guraneri 2005 Model machine customized for High Temperature and High
Pressure which is very suitable for maximum Chintz finish. Heat source for this machine
is Thermo-oil
III.11 Folding Department:

The folding department of the Gohar has a daily production of 1,00,000m. The folding
department is the last department of the Processing Unit. After the folding unit the fabric
is transferred to GSC.

The folding department has two kinds of machines; the kind is rolling machine while the
other kind is of folding machines. It depends on the requirement that which kind of
machine would be used.

In the folding department of Gohar latest 4 score method is used for the inspection
purposes. Quality checks are made at every step of processing unit.

III.12 Engraving:
The Engraving Department of Gohar Textile Mills (Pvt) Ltd is equipped with the latest
machinery along with the manual machinery for the process of exposing.

In the Engraving Department of Gohar, the screens are generally prepared which are then
used in the printing process.

Sizes of the Screens:

Following are the three repeats of screens which are used in the Engraving Department:

Ø 640mm

Ø 820mm

Similarly the widths of the screens are of the following five kinds:

Ø 2650mm

Ø 1850mm

Ø 1620mm

The selection of the screens depends on the design requirement of the print. The most
important thing which should be kept in mind is that only one screen should be used for
one color that means the number of screens will be equal to the number of colors which
will be used during the printing process.

III.12.1 Coating Stage:

The first step which is taken in the formation of the screens is to coat the screen with
SCR 100. This coating is done for the purpose of blocking the meshes of the screen so
that the required king of design can be made through the screen. The coating of the
screen takes almost 8-9 minutes.
III.12.2 Heating Stage:
These screens are then heated in the ovens so that to carry out the process in the best
possible manner. When the screens are heated in the proper way then they are taken to
the exposing machines. The heat is provided to the screens so that to fix the SCR 100 so
that the exposing stage should be started.
III.12.3 Exposing Stage:

Gohar Textile Mills (Pvt) Ltd has two exposing machines, one of them is manual and the
other is fully automatic. The automatic machine is the “wax jet”. The process of exposing
stage is different for both the machines.

In the process of Manual Machine, it is quite a time taking process. In this machine, the
presence of machine operator is very important; otherwise the time for each screen will
be higher than the original one.

Earlier most of the work was done through this machine but now the major load has been
shifted to “was jet”. Irrespective of these facts the importance of this machine is still

All sizes and widths of the screens can be prepared through this machine. Basically the
manual machine is used for the word of design studio.

The “Wax Jet” machine is fully automatic. The work done through the digital design
studio is done through this automatic machine. The speed of exposing through this
machine is relatively higher than the manual machine because there is not such need of
operator at every stage of the exposing.

The process at this machine does not effect because of the presence of the operator. The
exposing is being done through the wax on this machine that is why it has such a name.

The mechanism of this machine is that the machine is linked with the digital design
studio, so the operator can access any of the prepared design in the studio. Then the wax
is applied on the screen in such a way that the wax is applied on that place from where
the operator want to open the meshes. Then the lighting process is done i.e. the screen
goes through high power light.

The result of this process is that the place where only coating is there and there is no wax,
at these places the coating got fixed in such a way that the meshes are blocked in a better
way. After this Exposing stage the screen is taken to the next stage.
Gohar has ordered for “ink jet” machine which will enhance the production capability of
the engraving department.
III.12.4 Washing Stage:

The screens are then taken from the exposing machines to the washing area. This is the
area where the screens are washed so that the black portion can be washed from the
screens. This is also called the Developing Stage. The screens are then kept on the light
stand to see that whether the results are satisfactory or not. When the staff feels that the
design is satisfactory then they send this screen to the heating machine for curing.

III.12.5 Curing Stage:

The curing is being done through an oven. The screens are kept about 20-25 minutes in
the oven. This heat fixes the design on the screen so that after the final touch the screen
can be sent to the next department.
III.12.6 Enduring Stage:

During this stage the ring type iron is fixed on both the sides of the screens so that the
screens could be taken to the printing department for printing.
III.12.7 Touching Stage

During the touching stage the final work is done. In this stage if there is any extra patch
on the screen, then they are blocked with SCR52 so that the correct effect can be drawn
on the fabric. This is the final stage of Engraving Department. After this step, the screens
are then taken to printing department.

III.13 Design Studio

The design studio is a very important department of Processing Unit. The importance of
design studio is because of the reason that without its right work nothing correct can be
done. The presence of good design studio is very important for any good textile export

The buyer sends the desired design in the following forms:

Ø Through Sketches

Ø Through Fabric Sample

Ø Through CD

Ø swages

Now after having the concept of design, it is then the responsibility of design department
to make the screen design, to select the sizes of the screen, to select the repeats of the
screens and most importantly to make the films and designs so that to have the same
designs during the printing process as required by the buyer.

In the digital design studio the work is being done through the latest machineries and
software and dedicated and educated persons are there for the purpose carrying out the
process. All of the work in this studio is done on the latest machines and the work can be
accessed through the Wax Jet machine.

In the other design studio, the work is being done through the experienced persons. In
that studio the guideline is the first thing which is made at the start. After this step, there
comes a chain in the design studio such as to separate the colors up to making the and
preparing the films which can be used in the engraving department.

III.14 Cutting department

The cutting department is the first department of GSC, which takes the fabric. The fabric,
which is to be stitched, is brought from the folding department to the cutting department.
In this department the fabric is cut according to the specifications & need. From the
cutting department the fabric is transferred to the store from where the fabric is issued on
the required floor according to the freezing plan.

The cutting department objectives

o Quality control

o Cutting

o Minimize Wastage

So cutting department was performing these responsibilities. Mr. Arif the Cutting
supervisor who shared the rules of cutting that is the foundation of the complete stitching
department. Those are



The Process flow of cutting department is as below


Stitching Department (GSC)

Gohar has two stitching units.

1: One is situated in Kharurrianwala

2: The other is situated in Saeed Colony.

75 helpers are daily wages working as quality checker in the whole stitching department.
200 stitching machines in the whole stitching unit. Every machine operator has a unique
no to find out the any type of the fault.

The objectives of the stitching department are

• The cost minimization and

• To minimize wastage

• Best utilization of time

• Quality control by line checker

Types of stitching





• Blind stitch

• Over lock

• Flat lock

III.15 Dispatch Department

Dispatch department is performing two functions



Dispatch department is responsible to dispatch all types of Export after packing. It
depends on the marketing department when it should be dispatched. It is not necessary to
dispatch daily. Dispatch department is to pack and dispatch report preparation the prime
responsibility is to make maid-ups dispatch Report.

Dispatch Department has a continual liaison with Marketing Department and to fix
stickers according to the customer demand on the cartoons. The dispatch report also send
to the head office and as well as customer. Work force is use for loading or shipping in

Container Type:

• Twenty fitter lengths

• Forty STD 8.5 feet length

• Forty STD = 9.5 height.

From cutting to dispatch process is as below

Cutting stitching Packing dispatch

III.16 Commercial Department:

Along with the cutting section, there is another important depart named as commercial
department. The working of commercial department starts from receiving the stitching
programs. First of all, they see whether it is a new order or a repeat order. Then they issue
a demand order through their Purchase Department. It is the duty of the commercial
department to arrange all the equipment needed in the stitching unit for every bulk order.
The products which are the responsibility of the commercial department includes label,
fusing, polyester rope, stiffener, insert card, poly bag, stickers, size stickers, identification
sticker, barcodes, security codes etc.

A freezing plan is made every month so as to maintain & systemize the production
process. The stitching units of Gohar have latest and number of machines to fulfill the
customer need & requirements. Total number of helpers in on daily wages in the whole
stitching unit is 75. There are 200 machines in the GSC (general stitching company).
Quality is most important consideration while production in Gohar. This is why the
quality checks in stitching department are of very good level. This shows that the Quality
checks in Gohar Sewing Units are of international standards.

As the stitching department is the last department before the dispatch of goods so a lot of
responsibility comes on its shoulders. There are sample rooms in the stitching units so as
to fulfill the sample stitching requirement for different markets to ensure customer

So the above is the brief overview of some of the Gohar operations. Now we’ll discuss
the chances of further improvement in Gohar.

III.17 Export Marketing Department:

The export department of Gohar Textile Mills (Pvt) Ltd is known to be the best
marketing department in the whole textile industry because of the commitment and
dedication of employees, the determination of work & the best management system.

Gohar Marketing has a very strong liaison with their customers around the world. That’s
why Gohar has different segments on the basis of different regions like North America,
Australia and Europe.

Every region has a different Export Manager and its whole staff. The marketing
responsibility is not only to just sales and marketing it has also to find out new horizons
and new ways. That’s why Managers visit to new Markets around the world.



4.1.1 Internal and External factors.

The Internal component of Analysis is concerned with the basic
strengths and weaknesses of the organization. Thus, it depicts the
internal environment of the company. The strengths of the company may
be its financial or human resources, processes, operational methods,
marketing strategies, segmentation techniques or any expertise that the
company may feel as its core competencies. Contrary to this, any
discrepancies in these factors, at the same time, may become the
weaknesses of the company. Hence, it is the internal environment of the
company that shapes its business strategies and provides direction to
survive in the marketplace.

The external component deals with the factors that the company faces in
its external competitive environment. These factors are categorized as
opportunities available for the company in the market place and the
threats strained by its competitors. The opportunities of the company
may by its ability to satisfy the ever arising needs of its customers better
than its competitors, new available markets, room for setting new
operations, falling of barriers due to globalization trend etc. If a firm fails
to avail the opportunities as soon as they arrive, these opportunities
become threats for that company. This is because your competitors will
avail that opportunity in their first attempt and attain first mover
advantage over you.

SWOT Analysis is a popular technique used to analyze some company’s

present business situation. It provides us with an overview of company’s
major strengths and its critical weaknesses. The external opportunities and
threats that the company faces in the external environment are also
highlighted in this approach.

4.2 SWOT Analysis

4.2.1 Strengths:
 No outside financing so we can under take big orders for longer periods without
having to think about any financial constraints.
 High Cumulative Customer retention rate since the start of operations
 Sustained growth rate of annual sales turnover.
 Consistent Quality ; Timely shipments
 Vertically integrated.

 High quality products.

 Excellent market image in the local and international market.

 Highly qualified management.

 Adequate financial resources.

 Adopting information technology.

 Loyal customers.

 Skilled Labor.

 Broad and motivational vision.

4.2.2 Weaknesses:
 High employee turnover

 Centralized management system

 High cost of production.

 Low production capacity.

 De-motivated Staff.

 Less promotional activities.

 Non-Corporative culture.

 Insufficient benefits for the employees.

 Stereotype machinery for processing.

 Communicational gap among different departments.

4.2.3 Opportunities:

 Zero sales tax to be charged on 12 textile raw materials

 Can expand its division such as entering in weaving sector also.

 Can introduce its own label in domestic as well in international market

 Can capture new market segment.

 Full potential of entertaining the local market.

 Can reduce the cost by proper utilization of resources.

 End of quota restrictions by the end of year 2004.

 Can hire well-educated and experienced staff.

 Globalization.

4.2.4 Threats:
 Entry of new competitors just likes China & India.
 Buyer need and demand changes.
 Political instability.
 Changing geopolitical situation.
 Change of government policies.
 Low price offered by competitors.
 Globalization



During my Internship I have done in the following Departments.
• Accounts
• Marketing

Accounts Department
In accounts department, I managed to understand the flow of
transactions, preparation of vouchers, and ledger posting.

• Preparation of vouchers
In account department under the supervision of concerned officer, I came to know
different types of vouchers being prepared and their process of preparation.

Vouchers are written evidence of any business transaction.

There are different types of voucher being prepared by the account department Gohar
Textiles are as under

 Cash payment voucher

 Cash receipt voucher
 Journal voucher
Now I will discuss each type of voucher

Cash payment voucher

These types of vouchers are prepared when cash payments are made against expenses.
I.e. repair; entertainment etc. In order to record the expense the following entry is passed.

Account code name of expense (debit) amount

Cash Account (credit) amount
Evidence of expense is attached with the cash receipt voucher.

Cash receipt voucher

These vouchers are prepared when the cashier on behalf of Gohar textiles is receiving
cash. However, these types of vouchers are small in quantity because majority of
transactions are done by bank. On receipt of cash, cashier prepared the cash received slip.
Account officer prepared voucher on the basis of cash receipt prepared by the cashier. In
order to book the transaction the following entry is passed in the books.
Account code cash account (debit) amount
Income account or receivable account (credit) amount
Journal voucher
These types of vouchers are generally prepared in the following circumstances.
 Purchase on credit
 Written off assets
 Rectification of mistakes or omission
Now I discuss one by one:
Purchase on credit
Generally raw material, stores, and spares are purchased on credit. In order to account
them for the journal voucher are prepared by the concerned officer
The following entry is passed.
Account code purchase account (debit) amount
Account code payable account (credit) amount
Copy of the Invoice is attached with voucher.

Written off Assets

These journal vouchers are prepared in order to charge the assets to expense for the
preparation of monthly Accounts.
To account for depreciation of Fixed assets

Account code depreciation account (debit) amount
Accumulated depreciation account (credit) amount
To account for raw material consumption
Account code raw material concerned account (debit) amount
Raw material store account (credit) amount
To account for store consumption
Account code store concerned account (debit) amount
Stores and spares account (credit) amount
To account for accrued expense
Account code expense account (debit) amount
Account payable account (credit) amount
Rectification of mistakes
In addition to above referred kinds of journal voucher is also passed rectify the mistakes
made in voucher preparation or posting

• Marketing
the main purpose of this department is to locate buyers through agents. So marketing
starts from locating the buyers, making contracts, opening of LC, shipment, and in last

payment is received.

Learning as internee
As I told above that I had prepared voucher of different types then I used to take voucher
to Mr. Tahir, Mis. Shazia and Mr. Ramazan to audit and got back audited vouchers from
the audit. Copied checks whose payments were to be made on that date. Then I brought a
few times invoices for sale tax from marketing department. Maintained records of filing
with Mr Farooqui. Next In purchase department I had only worked for filling there goods

received notes (GRN) and maintaining them in a serial manner. I have attended calls for a
person not seat or else.

As an internee I have done all the works diligently which I have mentioned above.
Instead I had done other works as well which a person on the job never performs. Like
someone asks me to take vouchers audit like I am his assistant. I have done that and never
said no. as I have seen those employees which went to audit and the other asked bring my
voucher as well and the person says no. I have my own work you should batter go
yourself. That is the thing which I wanted to share in this regard. New knowledge

New Knowledge acquired

One thing regarding new knowledge is what I have shared accomplishments. Next one
important thing regarding knowledge acquired is that what you are studying is not related
to the job duties you are doing in future. You have to understand that work from stat in
case of an employee leaving a company and joining other he also will have to understand
in new company. I have got a lot of sense regarding in an organization where every one is
working out for cutting your roots. How to work in conservating environment. How to
behave in any situation? How to negotiate with any person on job?

Problems Encountered
Well I don’t have to face as many problems as I will have to face when I will go on job.
First few days were hard but I cannot say there was any problem. Employees were very
cooperative and they asked me to ask as many times about things till you are not cleared
about that. They guided me on every issue and asked me as like a big brother to learn as
much as you can. I am really thankful to all of them.

Impact of experience on my career

This experience definitely affects my career positively. As I would not have been come to
know about the atmosphere of any organization, this experience has told me a lot about
the environment of an organization and behavior of different type of people. All of this
edge goes to my institute’s good understanding about students’ future.


6.1 Financial Statements

6.1.1 Balance Sheet (Assets)


AS ON JUNE 30, 2009

ASSETS 2009 2008 2007

Non-Current Assets
Fixed Assets
Property, Plant and equipment 95,106,306 859,511,872 834,564,661
Capital work in progress 17,167,507 29,416,245 9,917,561
112,273,81 888,928,11 844,482,22
3 7 2

Long Term Deposits and 17,911,775 1,855,100 1,851,600

Deferred Cost

Due From Association 932,913,058 - -

Current Assets

Stores, spares and loose tools 5,371,789 22,059,708 21,923,660

Stock in trade 501,519,693 418,396,869 254,750,341
Trade Debts 325,722,287 179,273,728 230,280,445
Loans and advances 108,291,134 14,551,289 16,070,374
Deposits & Prepayments 1,520,559 634,052 475,251
Other Receivables 90,774,664 45,621,999 48,094,547
Cash & Bank Balances 5,862,001 12,269,150 25,341,111
1,039,062,12 596,935,72
7 692,806,795 9

2,102,160,77 1,583,590,01 1,443,269,55
3 1 1

6.1.2 Balance Sheet (Liabilities)


AS ON JUNE 30, 2009
EQUITY & LIABILITIES 2009 2008 2007
Share Capital & Reserves
Authorized Capital
1,000,000 ordinary shares of Rs 100,000,00 100,000,00 100,000,00
of Rs. 100/= each 0 0 0

Issued Subscribed & Paid up Capital 40,649,500 40,649,500 40,649,500

Revenue Reserves 1,537,898,335 1,040,929,687 977,358,726
1,578,547,83 1,081,579,18 1,018,008,22
5 7 6
Surplus on Revaluation of Fixed 136,785,79 150,307,32
Assets 3 5
Non Current Liabilities
108,893,47 161,993,47
Long Term Loans 108,893,475 5 5

Liabilities against Assets Subject to 5,544,15

Finance Lease 697,617 - 4
Due to Associate Undertaking 90,859,194 - -
Current Liabilities
Trade & Other Payable 111,904,367 78,746,596 50,187,799
Interest/Markup Payable - 2,938,326 1,785,003
Current Portion of Long Term 91,258,28 58,665,99 42,981,01
Liabilities 5 1 2
Short Term Finance 120,000,000 105,000,000 -
Advances from customers - 264,209 -
Provision for Taxation - 10,716,434 12,462,557
323,162,65 256,331,55 107,416,37
Contingencies & Commitment 2 6 1

2,102,160,77 1,583,590,01 1,443,269,55
3 1 1

6.1.3 Income Statement



2009 2008 2007


Sales 1,685,690,136 939,447,389 1,106,826,330

Cost of Sales (1,337,574,966) (772,932,261) (924,243,329)
Gross Profit 348,115,170 166,515,128 182,583,001

Selling & Distribution Expenses (136,679,293) (53,845,099) (62,077,899)

Administrative Expenses (30,820,720) (23,493,925) (26,086,598)

(167,500,013) (77,339,025) (88,164,497)

180,615,157 89,176,103 94,418,504

Other Operating Income 113,018,209 54,304 25,463

Other Operating Expenses (293,887) (3,263,473) -
293,339,479 85,966,935 94,443,967

Finance Cost (12,529,084) (23,960,952) (16,077,485)

Net Profit for the year before taxation 280,810,395 62,005,983 78,366,482

Provision for Taxation (15,246,256) (10,716,434) (12,462,557)

Net Profit for the year after taxation 265,564,139 51,289,549 65,903,925

6.2 Vertical/Cross-Sectional/Common Size Analysis Techniques

Vertical/Cross-sectional/Common size statements came from the problems in comparing

the financial statements of firms that differ in size.

• In the balance sheet, the assets as well as the liabilities and equity are each
expressed as a 100% and each item in these categories is expressed as a
percentage of the respective totals.
• In the common size income statement, turnover is expressed as 100% and every
item in the income statement is expressed as a percentage of turnover (sales).

6.2.1 Vertical Analysis (Liabilities)


Vertical Analysis (Liabilities)

EQUITY & LIABILITIES 2009 2008 2007

Share Capital & Reserves
Authorised Capital
1,000,000 ordinary shares
of Rs. 100/= each 5% 6% 7%

Issued Subscribed &

Paid up Capital 2% 3% 3%
Revenue Reserves 73% 66% 68%
75% 68% 71%

Surplus on Revaluation of
Fixed Assets - 9% 10%

Non Current Liabilities

Long Term Loans 5% 7% 11%

Liabilities against Assets Subject

to Finance Lease 0.03% - 0.4%
Due to Associate Undertaking 4% - -
Current Liabilities

Trade & Other Payable 5% 5% 3%

Interest/Markup Payable - 0.2% 0.1%
Current Portion of Long Term Liabilities 4% 4% 3%
Short Term Finance 6% 7% -
Advances from customers - 0.02% -
Provision for Taxation - 1% 1%

15% 16% 7%
Contingencies & Commitment

100% 100% 100%

6.2.2 Vertical Analysis (Assets)

Vertical Analysis (Assets)
Increase or (Decrease) %age
ASSETS 2009 2008 2007
Non-Current Assets
Fixed Assets
Property, Plant and equipment 5% 54% 58%
Capital work in progress 1% 2% 1%
5% 56% 59%

Long Term Deposits

and Deferred Cost 1% 0.12% 0.13%

Due From Association 44% - -

Current Assets
Stores, spares and loose tools 0.3% 1% 2%
Stock in trade 24% 26% 18%
Trade Debts 15% 11% 16%
Loans and advances 5% 1% 1%

Deposits & Prepayments 0.1% 0.04% 0.03%
Other Receivables 4% 3% 3%
Cash & Bank Balances 0.3% 1% 2%
49% 44% 41%

100% 100% 100%

From the vertical analysis above, we can compare the percentage mark-up of asset items
and how they have been financed. The strategies may include increase/decrease the
holding of certain assets. We may as well observe the trend of the increase in the assets
and liabilities over several years.

6.2.3 Vertical Analysis (Income Statement)

Vertical Analysis
2009 2008 2007
Sales 100% 100% 100%
Cost of Sales -79% -82% -84%
Gross Profit 21% 18% 16%

Selling & Distribution Expenses -8% -6% -6%

Administrative Expenses -2% -3% -2%

-10% -8% -8%

11% 9% 9%
Other Operating Income 7% 0% 0%
Other Operating Expenses 0% 0% 0%
17% 9% 9%
Finance Cost -1% -3% -1%
Net Profit for the year before
taxation 17% 7% 7%
Provision for Taxation -1% -1% -1%
Net Profit for the year after
taxation 16% 5% 6%

6.3 Horizontal Financial Statement Analysis

This technique is also known as comparative analysis. It is conducted by setting

consecutive balance sheet, income statement or statement of cash flow side-by-side and
reviewing changes in individual categories on a year-to-year or multiyear basis. The most
important item revealed by comparative financial statement analysis is trend.
A comparison of statements over several years reveals direction, speed and extent of a
trend(s). The horizontal financial statements analysis is done by restating amount of each
item or group of items as a percentage.

Such percentages are calculated by selecting a base year and assign a weight of 100 to the
amount of each item in the base year statement. Thereafter, the amounts of similar items
or groups of items in prior or subsequent financial statements are expressed as a
percentage of the base year amount. The resulting figures are called index numbers or
trend ratios. From the balance sheet statement in exhibit 1. The following indexed
balance sheet can be established.

6.3.1 Horizontal Analysis (Liabilities)
Horizontal Analysis (Liabilities)
EQUITY & LIABILITIES Increase or (Decrease) %age
2008-2009 % 2007-2008 %
Share Capital & Reserves
Authorised Capital
1,000,000 ordinary shares
of Rs. 100/= each - - - -
Issued Subscribed & -
Paid up Capital - - - -
Revenue Reserves 495,728,528 48% 64,811,081 7%
495,728,528 46% 64,811,081 6%
Surplus on Revaluation of -
Fixed Assets (136,785,793) -100% (13,521,533) -9%
Non Current Liabilities -
Long Term Loans - - (53,100,000) -33%

Liabilities against Assets Subject

to Finance Lease 697,617 - (5,544,154) -100%
Due to Associate Undertaking 90,859,194 - -
Current Liabilities -
Trade & Other Payable 34,397,890 44% 27,318,678 54%
Interest/Markup Payable (2,938,326) -100% 1,153,323 65%
Current Portion of Long Term
Liabilities 32,592,294 56% 15,684,979 36%
Short Term Finance 15,000,000 14% 105,000,000
Advances from customers (264,209) -100% 264,209
Provision for Taxation (10,716,434) -100% (1,746,123) -14%
68,071,215 27% 147,675,066 137%

Contingencies & Commitment -
518,570,762 33% 140,320,460 10%

6.3.2 Horizontal Analysis (Assets)

Horizontal Analysis (Assets)

Increase or (Decrease) %age

ASSETS 2008-2009 % 2007-2008 %
Non-Current Assets
Fixed Assets
Property, Plant and (764,405,566
equipment ) -89% 24,947,211 3%
Capital work in progress (12,248,738) -42% 19,498,684 197%
) -87% 44,445,895 5%
Long Term Deposits -
and Deferred Cost 16,056,675 866% 3,500 0.19%
Due From Association 932,913,058 - - -
Current Assets - -
- -
Stores, spares and loose tools (16,687,919) -76% 136,048 1%
Stock in trade 83,122,824 20% 163,646,528 64%
Trade Debts 146,448,559 82% (51,006,717) -22%
Loans and advances 93,739,845 644% (1,519,085) -9%
Deposits & Prepayments 886,507 140% 158,801 33%
Other Receivables 45,152,665 99% (2,472,548) -5%
Cash & Bank Balances (6,407,149) -52% (13,071,961) -52%
346,255,332 50% 95,871,066 16%
518,570,762 33% 140,320,460 10%

As basis of Analysis, the analyst may seek variables which seem to improve or
deteriorate and bring a challenge to the stakeholders in their various decisions. Example
from the previous table one can ask the following questions?

• Why is there an increase in the stock of the company? Has the company changed
its inventory policy?
• Why did taxation increase so tremendously? Were there any changes in taxation?
Is it reflected by the increase in sales? Profit?
• Why is there an increase in the fixed assets and at the same time decrease in the
long-term debt? How were these assets financed?

6.3.3 Horizontal Analysis (Income Statement)


Horizontal Analysis
2008-2009 2007-2008
% %
Change Change Change

Sales 746,242,747 79% (167,378,941) -15%

Cost of Sales (564,642,705) 73% 151,311,068 -16%
Gross Profit 181,600,042 109% (16,067,873) -9%
- -
- -
Selling & Distribution Expenses (82,834,194) 154% 8,232,800 -13%
Administrative Expenses (7,326,795) 31% 2,592,673 -10%
- -
(90,160,988) 117% 10,825,472 -12%
- -
91,439,054 103% (5,242,401) -6%
- -
Other Operating Income 112,963,905 % 28,841 113%
Other Operating Expenses 2,969,586 -91% (3,263,473) 0%
207,372,544 241% (8,477,032) -9%
- -
Finance Cost 11,431,868 -48% (7,883,467) 49%
- -
Net Profit for the year before
taxation 218,804,412 353% (16,360,499) -21%
- -
Provision for Taxation (4,529,822) 42% 1,746,123 -14%

- -
214,274,59 (14,614,37
Net Profit for the year after taxation 0 418% 6) -22%
6.4 Ratio Analysis

Ratio analysis is one of the techniques of financial analysis where ratios are used as a
yardstick for evaluating the financial condition and performance of a firm. Analysis and
interpretation of various accounting ratios gives skilled and experienced analyst a better
understanding of the financial condition and performance of the firm than what he could
have obtained only through a perusal of financial statements.



Activity Ratios

leverage Ratio



Liquidity represents the ability of a company to efficiently and economically

accommodate deposits withdrawal as well as fund increase in assets. A company has a
liquidity potential when it has the ability to obtain sufficient funds in a timely manner at a
reasonable cost. Illiquidity is a primary factor leading to a Company’s failure whereas
high liquidity helps otherwise weak institutions to remain funded during the period of

• Liquidity refers to the ability of a firm to meet its short-term financial obligations
when and as they fall due.
• The main concern of liquidity ratio is to measure the ability of the firms to meet
their short-term maturing obligations. Failure to do this will result in the total
failure of the business, as it would be forced into liquidation.
I. Current ratio
II. Quick Asset to Deposit ratio CURRENT RATIO

The Current Ratio expresses the relationship between the firm’s current assets and its
current liabilities.
Current assets normally include cash, marketable securities, accounts receivable and
inventories. Current liabilities consist of accounts payable, short term notes payable,
short-term loans, current maturities of long term debt, accrued income taxes and other
accrued expenses (wages).

Current Ratio :- Current Assets

Current Liabilities
Current Assets
2009 2008 2007
Stores, spares and loose tools 5,371,789.00 22,059,708 21,923,660
Stock in trade 501,519,693.00 418,396,869 254,750,341
Trade Debts 325,722,287.00 179,273,728 230,280,445
Loans and advances 108,291,134.00 14,551,289 16,070,374
Deposits & Prepayments 1,520,559.00 634,052 475,251
Other Receivables 90,774,664.00 45,621,999 48,094,547
Cash & Bank Balances 5,862,001.00 12,269,150 25,341,111

Total Current Assets 1,039,062,127.00 692,806,794.75 596,935,729.00

Current Liabilities
2009 2008 2007
Trade & Other Payable 111,904,367 78,746,596 50,187,799
Interest/Markup Payable - 2,938,326 1,785,003
Current Portion of Long Term
Liabilities 91,258,285 58,665,991 42,981,012
Short Term Finance 120,000,000 105,000,000 -
Advances from customers - 264,209 -
Provision for Taxation - 10,716,434 12,462,557

Total Current Liabilities 323,162,652.00 256,331,556.42 107,416,371.00

Particulars 2009 2008 2007

Rs. Rs. Rs.
Current Asset 1,039,062,127 692,806,795 596,935,729
Current Liabilities 23,162,652 256,331,556 107,416,371

Ratio 3.22 2.70 5.56

2009 2008 2007

This ratio shows that whether the current assets of the company are Sufficient to meet the
current liabilities or not. In 2006 it was 5.56 that shows low liquidity because this ratio is
above standard that is 2. In 2007 it was 2.70, that shows that firm use financing leverage
in 2007 and approximately to 3.32 in 2008, that shows that firm decrease its debt in his

Measures assets that are quickly converted into cash and they are compared with current
liabilities. This ratio realizes that some of current assets are not easily convertible to cash
e.g. inventories.
The quick ratio, also referred to as acid test ratio, examines the ability of the
business to cover its short-term obligations from its “quick” assets only (i.e. it
ignores stock). The quick ratio is calculated as follows

Quick Ratio:- Quick assets

Current Liabilities

Liquid Assets 2009 2008 2007
Stores, spares and loose 5,371,789 22,059,708 21,923,660
Stock in trade 501,519,693 418,396,869 254,750,341
Trade Debts 325,722,287 179,273,728 230,280,445
Loans and advances 108,291,134 14,551,289 16,070,374
Deposits & Prepayments 1,520,559 634,052 475,251
Other Receivables 90,774,664 45,621,999 48,094,547
Cash & Bank Balances 5,862,001 12,269,150 25,341,111

Total Current Assets 1,039,062,127 692,806,794.75 596,935,729

501,519,693 418,396,869 254,750,341
Less:- Inventory

537,542,434 274,409,926 342,185,388

Total Liquid Assets
2009 2008 2007
Rs. Rs. Rs.
Current Asset- Inventory 537,542,434 274,409,926 342,185,388
Current Liabilities 323,162,652 256,331,556 107,416,371
Ratio 1.66 1.07 3.19

2009 2008 2007

This ratio shows that how much quick assets are available to meet the demand of the
accountholders. This ratio was 3.19% in 2006 and decreased to 1.07% in 2007. It shows
that in 2007 the immediate liquidity position of the company was comparatively weak.
But it is good sign in 2008 that is once again liquid ratio is increasing.
6.4.2 Activity Ratio

If a business does not use its assets effectively, investors in the business would rather
take their money and place it somewhere else. In order for the assets to be used
effectively, the business needs a high turnover.

Unless the business continues to generate high turnover, assets will be idle as it is
impossible to buy and sell fixed assets continuously as turnover changes. Activity ratios
are therefore used to assess how active various assets are in the business.

Note: Increased turnover can be just as dangerous as reduced turnover if the business
does not have the working capital to support the turnover increase. As turnover increases
more working capital and cash is required and if not, overtrading occurs. Receivable Turn Over Ratio

Annual Credit Sale

Total Receivable

Particulars 2009 2008 2007

Rs. Rs. Rs.
Annual Credit Sale 1,685,690,136 939,447,389 1,106,826,330
Total Receivable 325,722,287 179,273,728 230,280,445
Ratio 5.18 5.24 4.81

2009 2008 2007

This ratio measures the number of times, on average, receivables (e.g. Accounts
Receivable) are collected during the period.
In 2008 this ratio is decreased .06 from last year 2007. It shows that firm has change its
account receivable policy. Receivable in days / Average Collection Period

The average collection period measures the quality of debtors since it indicates the speed
of their collection.

• The shorter the average collection period, the better the quality of debtors, as a
short collection period implies the prompt payment by debtors.
• The average collection period should be compared against the firm’s credit terms
and policy to judge its credit and collection efficiency.
• An excessively long collection period implies a very liberal and inefficient credit
and collection performance.
• The delay in collection of cash impairs the firm’s liquidity. On the other
hand, too low a collection period is not necessarily favourable, rather it may
indicate a very restrictive credit and collection policy which may curtail sales
and hence adversely affect profit.

Account Receivable /
Receivable in days :- ---------------------------- X 365
Annual Credit Sale

Particulars 2009 2008 2007

Rs. Rs. Rs.
65,434,910,72 84,052,362,425
Account Receivable X 365 118,888,634,755 0
Annual Credit Sale 1,685,690,136 939,447,389 1,106,826,330
Ratio 70.53 69.65 75.94

2009 2008 2007

As in 2005 average collection period was 76 days but it is decreasing with the passage of
time and in 2008 it is 70 days, which shows the efficiency of collection department. Our
sales are definitely increasing which is the core purpose of every organization. Accounts Payable Turn over Ratio

Annual Credit Purchase

Account payable

Particulars 2009 2008 2007
Rs. Rs. Rs.
Annual Credit Purchase 1,337,574,966 772,932,261 924,243,329
Account payable 111,904,367 78,746,596 50,187,799
Ratio 11.95 9.82 18.42

2009 2008 2007


A short-term liquidity measure used to quantify the rate at which a company pays off its
suppliers. Accounts payable turnover ratio is calculated by taking the total purchases
made from suppliers and dividing it by the average accounts payable amount during the
same period.
In 2006 firm pays payment to credit after 18 days, but in 2008 company pays payment
after 11 days. It shows that firm has enough resources to pay the payment of creditors. Account Payable in days

Account payable
---------------------------- X 365
Annual Credit Purchase

Particulars 2009 2008 2007
Rs. Rs. Rs.
Account payable 40,845,093,955 28,742,507,692 18,318,546,635
Annual Credit Purchase 1,337,574,966 772,932,261 924,243,329
Ratio 30.54 37.19 19.82

2009 2008 2007


The average payment period ratio represents the number of days taken by the firm to pay
its creditors. A higher credit turnover ratio a lower credit period ratio signifies that the
creditors being paid promptly, thus enhancing toe creditworthiness of the company.
However, a very favorable ratio to this effect also shows that the business is not taking
full advantage of credit facilities allowed by he creditors.

As in 2005, the ratio was 20 days but in 2008 it is 31 days only. It is favorable actually
for the creditors but not for the company because the firm has to arrange more finance for
the same period of time which will definitely be difficult for the firm due to low level of
average collection period. Inventory Turnover Ratio

Cost of Goods Sold
Average Inventory

Particulars 2009 2008 2007

Rs. Rs. Rs.
Cost of Goods Sold 1,337,574,966 772,932,261 924,243,329
Average Inventory 501,519,693 418,396,869 254,750,341
Ratio 2.67 1.85 3.63

2009 2008 2007


This ratio measures the stock in relation to turnover in order to determine how often the
stock turns over in the business.
It indicates the efficiency of the firm in selling its product. It is calculated by dividing he
cost of goods sold by the average inventory.

69 Total Asset Turn Over
Total Assets

Particulars 2009 2008 2007

Rs. Rs. Rs.
Sales 1,685,690,136 939,447,389 1,106,826,330
Total asset 2,102,160,773 1,583,590,011 1,443,269,551
Ratio 0.80 0.59 0.77

2009 2008 2007


Asset turnover is the relationship between sales and assets

• The firm should manage its assets efficiently to maximise sales.

• The total asset turnover indicates the efficiency with which the firm uses all its
assets to generate sales.
• It is calculated by dividing the firm’s sales by its total assets.

• Generally, the higher the firm’s total asset turnover, the more efficiently its assets
have been utilised.

6.4.3 Leverage ratio

• The ratios indicate the degree to which the activities of a firm are supported by
creditors’ funds as opposed to owners.
• The relationship of owner’s equity to borrowed funds is an important indicator of
financial strength.
• The debt requires fixed interest payments and repayment of the loan and
legal action can be taken if any amounts due are not paid at the appointed time. A
relatively high proportion of funds contributed by the owners indicates a cushion
(surplus) which shields creditors against possible losses from default in payment.

Note: The greater the proportion of equity funds, the greater the degree of
financial strength. Financial leverage will be to the advantage of the ordinary
shareholders as long as the rate of earnings on capital employed is greater than the
rate payable on borrowed funds.
The following ratios can be used to identify the financial strength and risk of the
business. Debt to total Asset Ratio

Total Debt (short & Long)

Total Assets

Particulars 2009 2008 2007

Rs. Rs. Rs.
Total Debt (short & Long) 432,753,744 365,225,031 274,954,000
Total Asset 2,102,160,773 1,583,590,011 1,443,269,551
Ratio 21% 23% 19%

2009 2008 2007

2009 2008 2007

This is the measure of financial strength that reflects the proportion of capital which has been
funded by debt, including preference shares.
The debt to total assets ratio measures the proportion of total assets financed by the
company’s creditors. The higher is the ratio, the greater is the amount of other people’s
money being used in an attempt to generate profit. Long term Debt to Share holder equity Ratio

Long term Debt


Particulars 2009 2008 2007

Rs. Rs. Rs.
Long term Debt 109,591,092 108,893,475 167,537,629
Equity 1,578,547,835 1,081,579,187 1,018,008,226
Ratio 7% 10% 16%

2009 2008 2007

This ratio indicates the extent to which debt is covered by shareholders’ funds. It reflects
the relative position of the equity holders and the lenders and indicates the company’s
policy on the mix of capital funds.
This ratio shows that how much company is financed more by debt than its own equity.
From 2006 to2008 it goes on falling which shows that gradually company’s operations
are more financed by its equity than by debt, this is due to decrease in short term finances Time Interest Earned Ratio

Particulars 2009 2008 2007

Rs. Rs. Rs.
Earning before interest and tax 280,810,395 62,005,983 78,366,482
Interest Charges 12,529,084 23,960,952 16,077,485
Ratio 22.41 2.59 4.87

2009 2008 2007


This ratio measure the extent to which earnings can decline without causing financial
losses to the firm and creating an inability to meet the interest cost.

• The times interest earned shows how many times the business can pay its interest
bills from profit earned.
• 2009
Present and prospective loan creditors 2008
such as bondholders, 2007
are vitally interested
to know how adequate the interest payments on their loans are covered by the
earnings available for such payments.
• Owners, managers and directors are also interested in the ability of the business to
service the fixed interest charges on outstanding debt.

The company’s major forms of credit are non-interest bearing (trade creditors) which
results in the business enjoying very healthy interest coverage rates. In 2002 the company
could pay their interest bill 16.5 times from earnings before interest and tax. However
this is a massive drop from 51.5 times in 2001 and 37.7 times in 2000.


Profitability is the ability of a business to earn profit over a period of time.

Although the profit figure is the starting point for any calculation of cash flow, as
already pointed out, profitable companies can still fail for a lack of cash.

Note: Without profit, there is no cash and therefore profitability must be seen as a critical
success factors.

• A company should earn profits to survive and grow over a long period of time.
• Profits are essential, but it would be wrong to assume that every action initiated
by management of a company should be aimed at maximising profits, irrespective
of social consequences.

The ratios examined previously have tendered to measure management efficiency and

Profitability is a result of a larger number of policies and decisions. The profitability

ratios show the combined effects of liquidity, asset management (activity) and debt
management (gearing) on operating results. The overall measure of success of a business
is the profitability which results from the effective use of its resources.

Following profitability ratios have been calculated

I. Gross Profit Margin Ratio

II. Net Operating Income Ratio
III. Net Profit Ratio
IV. Return on equity
V. Return on investment Gross Profit Margin Ratio

Gross profit
------------------ X 100

Particulars 2009 2008 2007
Rs. Rs. Rs.
Gross Profit 348,115,170 166,515,128 182,583,001
Sale 1,685,690,136 939,447,389 1,106,826,330
Ratio 21% 18% 16%

2009 2008 2007


• Normally the gross profit has to rise proportionately with sales.

• It can also be useful to compare the gross profit margin across similar businesses
although there will often be good reasons for any disparity.
• The ratio above shows the increasing trend in the gross profit since the ratio has
improved from 15.2% in 2000 to 20.3% on 2002. This indicates that the rate in
increase in cost of goods sold are less than rate of increase in sales, hence the
increased efficiency. Net Operating Margin

Operating Income
------------------------ x 100

Particulars 2009 2008 2007
Rs. Rs. Rs.
Operating Income 293,339,479 85,966,935 94,443,967
Sale 1,685,690,136 939,447,389 1,106,826,330
Ratio 17% 9% 9%

2009 2008 2007

It is a measurement of what proportion of a company's revenue is left over, before taxes
and other indirect costs (such as rent, bonus, interest, etc.), after paying for variable costs
of production as wages, raw materials, etc. A good operating margin is needed for a
company to be able to pay for its fixed costs, such as interest on debt. A higher operating
margin means that the company has less financial risk.
In 2006 company has ratio 9% but it has been increasing with time being to 17%, which
very good for firm. Net Profit Margin

Net Profit after tax x 100
Net Sales

Particulars 2009 2008 2007

Rs. Rs. Rs.
Net Profit 265,564,139 51,289,549 65,903,925
Sale 1,685,690,136 939,447,389 1,106,826,330
Ratio 16% 5% 6%

2009 2008 2007

This is a widely used measure of performance and is comparable across companies in
similar industries. The fact that a business works on a very low margin need not cause
alarm because there are some sectors in the industry that work on a basis of high turnover
and low margins, for examples supermarkets and motorcar dealers.
What is more important in any trend is the margin and whether it compares well with
similar businesses.
Net profit ratio indicates that how much net sales are contributing towards generating Net
Profit. In 2006 it was 6% and decreased to 5% in 2007. But Firm uses its resources
efficiently in 2007 and it was increased to 16% in 2007 so the year 2007 was best year
from profitability point of view in these years.

78 Return On Equity

This ratio shows the profit attributable to the amount invested by the owners of the
business. It also shows potential investors into the business what they might hope to
receive as a return. The stockholders’ equity includes share capital, share premium,
distributable and non-distributable reserves. The ratio is calculated as follows:
Net Profit
Particulars 2009 2008 2007
Rs. Rs. Rs.
Net Profit 265,564,139 51,289,549 65,903,925
Equity 1,578,547,835 1,081,579,187 1,018,008,226
Ratio 17% 5% 6%

2009 2008 2007

The ratio shows that how much equity is contributing towards generating Net Income. In
2006 it was increased to 6% and decreased to 5% in 2007 but in 2007 it also increased to
17% in 2007 so the year 2007 was best year from profitability point of view in these
years. Return on Investment

Income is earned by using the assets of a business productively. The more efficient the
production, the more profitable the business. The rate of return on total assets indicates
the degree of efficiency with which management has used the assets of the enterprise
during an accounting period. This is an important ratio for all readers of financial

Investors have placed funds with the managers of the business. The managers used the
funds to purchase assets which will be used to generate returns. If the return is not better
than the investors can achieve elsewhere, they will instruct the managers to sell the assets
and they will invest elsewhere. The managers lose their jobs and the business liquidates.

ROI = Net Profit

Total Assets

Particulars 2009 2008 2007

Rs. Rs. Rs.
Net Profit 265,564,139 51,289,549 65,903,925
Total Asset 2,102,160,773 1,583,590,011 1,443,269,551
Ratio 13% 3% 5%

2009 2008 2007

The ratio indicates that there is increase in the ROI from 8.38% in 2000 to 8.95% in 2002.

80 Break Up Value
Total equity / No. of Shares

Particulars 2009 2008 2007

Rs. Rs. Rs.
Total Equity 1,578,547,835 1,081,579,187 1,018,008,226
No. of Shares 1,000,000 1,000,000 1,000,000
Ratio 1578.55 1081.579 1018.008

2009 2008 2007



It’s' period of Globalization, any organization or institute who ignore the element of

globalization automatically kick out from the market. Only those can be survive who

compete this global market perfectly.

So the Gohar Textile Mills (Pvt) Ltd has the opportunity to survive the global market

because it has the better goodwill and positive earning per share it can capture all the

global market.

Gohar Textile Mills (Pvt) Ltd is also faces a tenor in which there is both opportunities

and threats for it to be able and survive and growth. But many of the challenges that shall

be outside of the control of the mills.

However, this does not absolve the government of Pakistan and the local Textile industry

from its responsibility to best deal with the climate both locally and internationally and

prepare itself for even greater challenges.

Now there is need that the Govt. and industry realize that a sincere and positive approach

has to make to meet the challenges of the present day competition environment. In this

regard adequate finance for capital investment, working capital and development of

comprehensive long-term strategies and the stable government.

Gohar Textile Mills (Pvt) Ltd is one the best apparel producer in Pakistan. Inside the

organization Gohar textile is practically meeting the challenges of Global Village. They

have created completely paperless office; every activity of Gohar is online. In/Out time of

employees is also computerized.

I have observed some negative things also during my internship in Gohar like sometime

extra burden is loaded on worker due to late shipment.

Even Gohar has great capability to meet the requirements but some times Gohar get the

order in such a bulk quantity that its capacity becomes lesser than orders.

Financial position of Gohar is better than many other organizations. Gohar’s decision-

making is centralized due to which no problem occur in lower level management. The

level management of Gohar is also performing well.

Before joining this organization I know a little about the organization work, its working
system and environment, so I learned a lot from this experience. Based on my experience
& observation regarding the operations and policies of organization, there are some
recommendations which include short term as well as long term issues for the

7.2.1 Assess the Performance of employees

There is no efficient method introduced by organization for his assessment of
performance of employees. Promotions are completely relying on higher management
like managers est.’s there can be some sort of favoritism. So to avoid all this, there should
be a proper method to judge the employees.
7.2.2 Search New Markets
Organization can enhance profit by finding new market in the world. Gohar Textile Mills
(Pvt) Ltd. should continue to expand its business, by increasing its sale through
aggressive market penetration strategies.
7.2.3 Improve Information Technology System
Gohar Textile Mills (Pvt) Ltd should immediately improve its Information Technology
System. The soft wares currently in use should be made error free as it is the need of the
7.2.4 Computerized Accounting System
As far as accounting is concerned, although the entire system is computerized, but there
still involves lots of paperwork. So this should be minimized b acquiring more advanced
accounting software
7.2.5 Job Rotation

There is no rotation of employees within departments and cross departments. So the top
management should immediately start thinking in terms of rotating the employees in
various departments, as this transforms work force into human capital.

7.2.6 Distribute Work Equally

Management should distribute work equally among different employees. Some of the
employees are overburdened while some sections are overstaffed.
7.2.7 Improve its Website
Gohar Textile Mills (Pvt) Ltd needs to improve its website. More information relating to
financial performance and sale of the organization should be available on the website.
7.2.8 Evolve Management Policy
Gohar Textile Mills (Pvt) Ltd should evolve a very serious management policy to attract
multi national corporations as its clients. This action, if actualized, would not only prove
to be highly profit generating, but it would also contribute a lot towards Gohar Textile
image building.
7.2.9 Advertise
One of the most pressing needs of the time is to advertise Gohar Textile Mills (Pvt) Ltd
in the electronic media. Gohar Textile Mills (Pvt) Ltd has not, till date, employed
advertisement in electronic media as a full fledge marketing tool. I think it is high time
that organization does this
7.2.10 Market Survey
The management should make the market survey time to time to get more and latest
information about the market factors like the price, demand, current consumer trends etc.