Study of Financial Performance-Shiva Sai

A FINAL PROJECT REPORT ON
“A STUDY ON FINANCIAL
PERFORMANCE ANANLYSIS”
(WITH REFERENCE TO KESORAM CEMENT)
BACHELORE OF BUSINESS ADMINISTRATION
AVINASH DEGREE COLLEGE
By
SHIVA SAI KRISHANA

Roll.No. 208513684013
Under the Guidance of

Prof.Somnath Chattopadhyay
AVINASH DEGREE COLLEGE

(Affiliated to Osmania University, Hyderabad)
Hyderabad
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2013-2016
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DECLARATION
I hereby declare that the project entitled “A study on financial performance

analysis at Kesoram Cement” submitted in partial fulfillment of the requirements for
award of the degree of BBA at AVINASH DEGREE COLLEGE, affiliated to
Osmania University, Hyderabad..
SHIVA SAI KRISHNA

208513684013
BBA
HYDERABAD
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ACKNOWLEDGEMENT
Firstly I would like to express our immense gratitude towards our institution
AVINASH DEGREE COLLEGE, which created a great platform to attain profound
technical skills in the field of BBA, thereby fulfilling our most cherished goal.
I would thank all the finance department of Kesoram specially Mr. MURTHY ASST
Manager Finance for guiding me and helping me in successful completion of the project
I am very much thankful to our Prof. SOMNATH CHATTOPADHYAY

(Internal Guide) sir for extending his cooperation in doing this project.
I convey my thanks to my beloved parents and my faculty who helped me directly

or indirectly in bringing this project successfully.
SHIVA SAI KRISHNA
(208513684013)
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INDEX
S.No: Contents Page No.
Chapter-1 1-8
Introduction Need
of the Study
Objectives of the Study

Methodology of the Study
Limitations of the Study
Chapter-2 9-28
Industry Profile
Company Profile
Chapter-3 29-38
Review of Literature
Chapter-4 39-68
Data Analysis And Interpretation
Chapter-5 69-71
Findings
Suggestions
Chapter-6 72-75
Annexure
Bibliography
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CHAPTER-I
INTRODUCTION
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Introduction:-
The term ‘financial performance analysis also known as analysis and interpretation
of financial statements’ , refers to the process of determining financial strength and
weaknesses of the firm by establishing strategic relationship between the items of the
balance sheet , profit and loss account and other operative data.
“Financial performance analysis is a process of evaluating the relationship

between component parts of a financial statement to obtain a better understanding of a
firm’s position and performance.
The purpose of financial analysis is to diagnose the information contained in

financial statements so as to judge the profitability and financial soundness of the firm.
Just like a doctor examines his patient by recording his body temperature, blood pressure
etc. Before making his conclusion regarding the illness and before giving his treatment. A
financial analyst analyses the financial statements with various tools of analysis before
commenting upon the financial health or weaknesses of an enterprise.
The analysis and interpretation of financial statements is essential to bring out the
mystery behind the figures in financial statements. Financial statements analysis is an
attempt to determine the significance and meaning of the financial statement data so that
forecast may be made of the future earnings, ability to pay interest and debt maturities
(both current and long term) and profitability of a sound divided policy.
Financial performance refers to the act of performing financial activity. In broader sense,
financial performance refers to the degree to which financial objectives being or has been
accomplished. It is the process of measuring the results of a firm's policies and operations
in monetary terms. It is used to measure firm's overall financial health over a given period
of time and can also be used to compare similar firms across the same industry or to
compare industries or sectors in aggregation.
In short, the firm itself as well as various interested groups such as managers,
shareholders, creditors, tax authorities, and others seeks answers to the
Following important questions:
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1. What is the financial position of the firm at a given point of time?
2. How is the financial performance of the firm over a given
period? Of time?
These questions can be answered with the help of financial analysis of a firm. Financial
analysis involves the use of financial statements. A financial statement is an organized
collection of data according to logical and conceptual framework 50 consistent accounting
procedures. Its purpose is to convey an understanding of some financial aspects of a
business firm. It may show a position at a moment of time as in the case of a balance
sheet, or may reveal a series of activities over a given period of time, as in the case of an
income statement.
Thus, the term ‘financial statements’ generally refers to two basic
statements: The balance sheet and the income statement.
The balance sheet shows the financial position (condition) of the firm at a given point of
time. It provides a snapshot and may be regarded as a static picture.
“Balance sheet is a summary of a firm’s financial position on a given date
that Shows total assets = total liabilities + owner’s equity.”
The income statement (referred to in India as the profit and loss statement) reflects the
performance of the firm over a period of time.
“Income statement is a summary of a firm’s revenues and expenses over a specified
period, ending with net income or loss for the period.”
However, financial statements do not reveal all the information related to the financial
operations of a firm, but they furnish some extremely useful information, which highlights
two important factors profitability and financial soundness. Thus analysis of financial
statements is an important aid to financial performance analysis. Financial performance
analysis includes analysis and interpretation of financial statements in such a way that it
Undertakes full diagnosis of the profitability and financial soundness of the business.
“The analysis of financial statements is a process of evaluating the relationship between

component parts of financial statements to obtain a better understanding of the firm’s
position and performance.”
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Need for Study
Need Of Financial Management Study To Diagnose The Information Contain In
Financial Statement. So as To Judge the Profitability and Financial Position of the
Firm.
Financial Analyst Analyses The Financial Statements With Various Tools Of

Analysis Before Commanding Upon The Financial Health Of The Firm.
Essential to Bring Out the History.
Significance and Meaning of the Financial Statements.
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Objectives:
1. To understand the financial statements of Kesoram cement.
2. To study the change in assets and liabilities of the company.
3. To study the liquidity position of the firm.
4. To study the financial health of the company using ratio analysis.
5. To study the profitability of the company.
6. To offer suggestions to the company.
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Significance of Financial Performance Analysis
Interest of various related groups is affected by the financial performance of a firm.

Therefore, these groups analyze the financial performance of the firm. The type of
analysis varies according to the specific interest of the party involved.
Trade creditors: interested in the liquidity of the firm (appraisal of firm’s liquidity)
Bond holders: interested in the cash-flow ability of the firm (appraisal of firm’s capital
structure, the major sources and uses of funds, profitability over time, and projection of
future profitability).
Investors: interested in present and expected future earnings as well as stability of these
earnings (appraisal of firm’s profitability and financial condition).
Management: interested in internal control, better financial condition and better
performance (appraisal of firm’s present financial condition, evaluation of opportunities in
relation to this current position, return on investment provided by various assets of the
company, etc)
Research Methodology
Research Design
This is a systematic way to solve the research problem and it is important

component for the study without which researches may not be able to obtain the format. A
research design is the arrangement of conditions for collection and analysis of data in a
manager that aims to combine for collection and analysis of data relevance to the research
purpose with economy in procedure.
Meaning of Research Design
The formidable problem that follows the task of defining the research problem is
the preparation of design of the research project, popularly known as the research design,
decision regarding what, where, when, how much, by what means concerning an inquiry
of a research study constitute a research design. A research design is the arrangement of
conditions for collection and analysis of data in a manager that aims to combine for
collection and analysis of data relevance to the research purpose with economy in
procedure.
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Sources of Data
Data we collected based on two sources.

Primary Data.
Secondary Data.
Primary Data
The Primary Data Are Those Information’s, which are Collected afresh and for the
First Time, And Thus Happen to Be Original in Character.
Secondary Data:
The secondary data are those which have already been collected by some other agency
and which have already been processed. The sources of secondary data are annual reports,
browsing internet, through magazines.
1. It includes data gathered from the annual reports of Kesoram.

2. Articles are collected from official website of Kesoram.
Methodology Used:
Types Of Financial Statements Adopted:

Following Two Types of Financial Statements Are Commonly Used in
Analyzing the Firm’s Financial Position
a. Balance Sheet.
b. Income Statements.
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Limitations of Financial Statement:
Each Project Gives Rise to Its Own Unique Risks And Hence Possess Its Own Unique
Challenges.
1. Only Interim Reports:
Only interim statements don’t give a final picture of the concern. The data given in
these statements is only approximate. The actual position can only be determined when
the business is sold or liquidated.
2. Don’t Give Extra Position:
The Financial Statements Are Expressed In Monetary Values, So They Appear To

Give Final And Accurate Position. The Values Of Fixed Assets In The Balance Sheet
Neither Represent The Value For Which Fixed Assets Can Be Sold Nor The Amount
Which Will Be Required To Replace These Assets.
3. Historical Costs:
The Financial Statements Are Prepared On The Basis Of Historical Costs Or

Original Costs. The Value of Assets Decreases with the Passage of Time Current Price
Changes Are Not Taken Into Account. The Statements Are Not Prepared Keeping In
View The Present Economic Conditions. The Balance Sheet Loses The Significance Of
Being An Index Of Current Economic Realities.
4. Act of non monitory factors Ignored:
There are certain factors which have a bearing on the financial position and
operating results of the business but they don’t become a part of these statements because
they can’t be measured in monetary terms. Such factors may include in the reputation of
the management.
No Precision:
The precision of financial statement data is not possible because the statements deal with
matters which can’t be precisely stated. The data are recorded by conventional procedures
followed over the years. Various conventions, postulates, personal judgments etc.
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CHAPTER-II
INDUSTRY PROFILE
&
COMPANY PROFILE
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Industry Profile:
In the most general sense of the word, cement is a binder, a substance

which sets and hardens independently, and can bind other materials together. The word
"cement" traces to the Romans, who used the term "opus caementicium" to describe
masonry which resembled concrete and was made from crushed rock with burnt lime as
binder. The volcanic ash and pulverized brick additives which were added to the burnt
lime to obtain a hydraulic binder were later referred to as cementum and cement. Cements
used in construction are characterized as hydraulic or non-hydraulic.
The most important use of cement is the production of mortar and concrete—the bonding
of natural or artificial aggregates to form a strong building material which is durable in the
face of normal environmental effects.
Concrete should not be confused with cement because the term CEMENT refers only to the
dry powder substance used to bind the aggregate materials of concrete. Upon the addition
of water and/or additives the cement mixture is referred to as concrete, especially if
aggregates have been added.
It is uncertain where it was first discovered that a combination of hydrated non-hydraulic lime
and a pozzolan produces a hydraulic mixture (see also: Pozzolanic reaction), but concrete
made from such mixtures was first used on a large scale by engineers. They used both natural
pozzolans (trass or pumice) and artificial pozzolans (ground brick or pottery) in these
concretes. Many excellent examples of structures made from these concretes are still standing,
notably the huge monolithic dome of the Pantheon in Rome and the massive Baths of
Caracalla. The vast system of Roman aqueducts also made extensive use of hydraulic cement.
The use of structural concrete disappeared in medieval Europe, although weak pozzolanic
concretes continued to be used as a core fill in stone walls and columns.
Modern cement
Modern hydraulic cements began to be developed from the start of the Industrial
Revolution (around 1800), driven by three main needs:
Hydraulic renders for finishing brick buildings in wet climates
Hydraulic mortars for masonry construction of harbor works etc, in contact with sea
water. Development of strong concretes.
In Britain particularly, good quality building stone became ever more expensive during a
period of rapid growth, and it became a common practice to construct prestige buildings
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from the new industrial bricks, and to finish them with a stucco to imitate stone. Hydraulic
limes were favored for this, but the need for a fast set time encouraged the development of
new cements. Most famous was Parker's "Roman cement." This was developed by James
Parker in the 1780s, and finally patented in 1796. It was, in fact, nothing like any material
used by the Romans, but was “Natural cement" made by burning septaria - nodules that
are found in certain clay deposits, and that contain both clay minerals and calcium
carbonate. The burnt nodules were ground to a fine powder. This product, made into a
mortar with sand, set in 5–15 minutes. The success of "Roman Cement" led other
manufacturers to develop rival products by burning artificial mixtures of clay and chalk.
John Smeaton made an important contribution to the development of cements when he was
planning the construction of the third Eddystone Lighthouse (1755-9) in the English Channel.
He needed a hydraulic mortar that would set and develop some strength in the twelve hour
period between successive high tides. He performed an exhaustive market research on the
available hydraulic limes, visiting their production sites, and noted that the "hydraulicity" of
the lime was directly related to the clay content of the limestone from which it was made.
Smeaton was a civil engineer by profession, and took the idea no further. Apparently unaware
of Smeaton's work, the same principle was identified by Louis Vicat in the first decade of the
nineteenth century. Vicat went on to devise a method of combining chalk and clay into an
intimate mixture, and, burning this, produced an "artificial cement" in 1817. James Frost,
working in Britain, produced what he called "British cement" in a similar manner around the
same time, but did not obtain a patent until 1822. In 1824, Joseph Aspdin patented a similar
material, which he called Portland cement, because the render made from it was in color
similar to the prestigious Portland stone.
All the above products could not compete with lime/pozzolan concretes because of fast-setting
(giving insufficient time for placement) and low early strengths (requiring a delay of many
weeks before formwork could be removed). Hydraulic limes, "natural" cements and "artificial"
cements all rely upon their belite content for strength development. Belite develops strength
slowly. Because they were burned at temperatures below 1250 °C, they contained no alite,
which is responsible for early strength in modern cements. The first cement to consistently
contain alite was made by Joseph Aspdin's son William in the early 1840s. This was what we
call today "modern" Portland cement. Because of the air of mystery with which William
Aspdin surrounded his product, others (e.g. Vicat and I C Johnson) have claimed precedence
in this invention, but recent analysis of both his concrete
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and raw cement have shown that William Aspdin's product made at North fleet, Kent was
a true alite-based cement. However, Aspdin's methods were "rule-of-thumb": Vicat is
responsible for establishing the chemical basis of these cements, and Johnson established
the importance of sintering the mix in the kiln.
William Aspdin's innovation was counter-intuitive for manufacturers of "artificial
cements", because they required more lime in the mix (a problem for his father), because
they required a much higher kiln temperature (and therefore more fuel) and because the
resulting clinker was very hard and rapidly wore down the millstones which were the only
available grinding technology of the time. Manufacturing costs were therefore
considerably higher, but the product set reasonably slowly and developed strength
quickly, thus opening up a market for use in concrete. The use of concrete in construction
grew rapidly from 1850 onwards, and was soon the dominant use for cements. Thus
Portland cement began its predominant role. It is made from water and sand.
Types of modern cement:

Portland cement:
Cement is made by heating limestone (calcium carbonate), with small quantities of other
materials (such as clay) to 1450°C in a kiln, in a process known as calcination, whereby a
molecule of carbon dioxide is liberated from the calcium carbonate to form calcium oxide,
or lime, which is then blended with the other materials that have been included in the mix
. The resulting hard substance, called 'clinker', is then ground with a small amount of
gypsum into a powder to make 'Ordinary Portland Cement', the most commonly used type
of cement (often referred to as OPC).
Portland cement is a basic ingredient of concrete, mortar and most non-speciality grout. The
most common use for Portland cement is in the production of concrete. Concrete is a
composite material consisting of aggregate (gravel and sand), cement, and water. As a
construction material, concrete can be cast in almost any shape desired, and once hardened,
can become a structural (load bearing) element. Portland cement may be gray or white.
Portland cement blends
These are often available as inter-ground mixtures from cement manufacturers, but similar
formulations are often also mixed from the ground components at the concrete mixing plant.
Portland blast furnace cement contains up to 70% ground granulated blast furnace slag,
with the rest Portland clinker and a little gypsum. All compositions produce high ultimate
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strength, but as slag content is increased, early strength is reduced, while sulfate resistance
increases and heat evolution diminishes. Used as an economic alternative to Portland
sulfate-resisting and low-heat cements.
Portland fly ash cement contains up to 30% fly ash. The fly ash is pozzolanic, so that
ultimate strength is maintained. Because fly ash addition allows lower concrete water
content, early strength can also be maintained. Where good quality cheap fly ash is
available, this can be an economic alternative to ordinary Portland cement.
Portland pozzolan cement includes fly ash cement, since fly ash is a pozzolan, but also
includes cements made from other natural or artificial pozzolans. In countries where
volcanic ashes are available (e.g. Italy, Chile, Mexico, and the Philippines) these cements
are often the most common form in use.
Portland silica fume cement. Addition of silica fume can yield exceptionally high
strengths, and cements containing 5-20% silica fume are occasionally produced. However,
silica fume is more usually added to Portland cement at the concrete mixer.
Masonry cements are used for preparing bricklaying mortars and stuccos, and must not
be used in concrete. They are usually complex proprietary formulations containing
Portland clinker and a number of other ingredients that may include limestone, hydrated
lime, air entrainers, retarders, water proofers and coloring agents. They are formulated to
yield workable mortars that allow rapid and consistent masonry work. Subtle variations of
Masonry cement in the US are Plastic Cements and Stucco Cements. These are designed
to produce controlled bond with masonry blocks.
Expansive cements contain, in addition to Portland clinker, expansive clinkers (usually
sulfoaluminate clinkers), and are designed to offset the effects of drying shrinkage that is
normally encountered with hydraulic cements. This allows large floor slabs (up to 60 m
square) to be prepared without contraction joints.
White blended cements may be made using white clinker and white supplementary
materials such as high-purity metakaolin.
Colored cements are used for decorative purposes. In some standards, the addition of
pigments to produce "colored Portland cement" is allowed. In other standards (e.g.
ASTM), pigments are not allowed constituents of Portland cement, and colored cements
are sold as "blended hydraulic cements".
Very finely ground cements are made from mixtures of cement with sand or with slag or
other pozzolan type minerals which are extremely finely ground together. Such cements can
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have the same physical characteristics as normal cement but with 50% less cement
particularly due to their increased surface area for the chemical reaction. Even with
intensive grinding they can use up to 50% less energy to fabricate than ordinary Portland
cements.
Non-Portland hydraulic cements
Pozzolan-lime cements. Mixtures of ground Pozzolan and lime are the cements used by
the Romans, and are to be found in Roman structures still standing (e.g. the Pantheon in
Rome). They develop strength slowly, but their ultimate strength can be very high. The
hydration products that produce strength are essentially the same as those produced by
Portland cement.
Slag-lime cements. Ground granulated blast furnace slag is not hydraulic on its own, but
is "activated" by addition of alkalis, most economically using lime. They are similar to
pozzolan lime cements in their properties. Only granulated slag (i.e. water-quenched,
glassy slag) is effective as a cement component.
Super sulfated cements. These contain about 80% ground granulated blast furnace slag,
15% gypsum or anhydrite and a little Portland clinker or lime as an activator. They
produce strength by formation of ettringite, with strength growth similar to a slow
Portland cement. They exhibit good resistance to aggressive agents, including sulfate.
Calcium aluminate cements are hydraulic cements made primarily from limestone and
bauxite. The active ingredients are monocalcium aluminate CaAl2O4 (CaO · Al2O3 or CA in
Cement chemist notation, CCN) and mayenite Ca12Al14O33 (12 CaO · 7 Al2O3, or C12A7 in
CCN). Strength forms by hydration to calcium aluminate hydrates. They are well-adapted for
use in refractory (high-temperature resistant) concretes, e.g. for furnace linings.
Calcium sulfoaluminate cements are made from clinkers that include ye'elimite (Ca4
(AlO2)6SO4 or C4A3 in Cement chemist's notation) as a primary phase. They are used in
expansive cements, in ultra-high early strength cements, and in "low-energy" cements.
Hydration produces ettringite, and specialized physical properties (such as expansion or rapid
reaction) are obtained by adjustment of the availability of calcium and sulfate ions. Their use
as a low-energy alternative to Portland cement has been pioneered in China, where several
million tonnes per year are produced. Energy requirements are lower because of the lower kiln
temperatures required for reaction and the lower amount of limestone (which must be
endothermically decarbonated) in the mix. In addition, the lower limestone
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content and lower fuel consumption leads to a CO2 emission around half that associated
with Portland clinker. However, SO2 emissions are usually significantly higher.
"Natural" Cements correspond to certain cements of the pre-Portland era, produced by
burning argillaceous limestones at moderate temperatures. The level of clay components
in the limestone (around 30-35%) is such that large amounts of belite (the low-early
strength, high-late strength mineral in Portland cement) are formed without the formation
of excessive amounts of free lime. As with any natural material, such cements have highly
variable properties.
Geopolymer cements are made from mixtures of water-soluble alkali metal silicates and
aluminosilicate mineral powders such as fly ash and metakaolin.
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COMPANY PROFILE
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Kesoram Cement Industry is one of the leading manufacturers of cement in India. It is a day
process cement Plant. The plant capacity is 8.26 lakh tones per annum It is located at
Basanthnagar in Karimnagar district of Andhra Pradesh. Basanthnagar is 8 km away from
the Ramagundam Railway station, linking Madras to New Delhi. The Chairman of the
Company is B.K.Birla,
History:
The first unit at Basanthnagar with a capacity of 2.1 lakh tones per annum
incorporating humble suspension preheated system was commissioner during the year 1969.
The second unit was setup in year 1971 with a capacity of 2.1 lakh tones per annum went on
stream in the year 1978. The coal for this company is being supplied from Singgareni
Collieries and the power is obtained from APSEB. The power demand for the factory is about
21 MW. Kesoram has got 2 DG sets of 4 MW each installed in the year 1987.
Kesoram Cement has setup a 15 KW captor power plant to facilitate for

uninterrupted power supply for manufacturing of cement at 24th august 1997 per hour 12
mw, actual power is 15 mw.
The Company was incorporated on 18th October, 1919 under the Indian Companies Act,
1913, in the name and style of Kesoram Cotton Mills Ltd. It had a Textile Mill at 42,
Garden Reach Road, Calcutta 700 024. The name of the Company was changed to
Kesoram Industries & Cotton Mills Ltd. on 30th
August, 1961 and the same was further changed to Kesoram Industries Limited on 9th
July, 1986. The said Textile Mill at Garden Reach Road was eventually demerged into a
separate company.
The First Plant for manufacturing of rayon yarn was established at Tribeni, District
Hooghly, West Bengal and the same was commissioned in December, 1959 and the
second plant was commissioned in the year 1962 enabling it to manufacture 4,635 metric
tons per annum (mtpa) of rayon yarn. This Unit has 6,500 metric tons per annum (mtpa)
capacity as on 31.3.2009.
The plant for manufacturing of transparent paper was also set up at the same location at
Tribeni, District Hooghly, West Bengal, in June, 1961. It has the annual capacity to
manufacture 3,600 metric tons per annum (mtpa) of transparent Paper.
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The Company diversified into manufacturing of cast iron spun pipes and pipe fittings at
Bansberia, District Hooghly, West Bengal, with a production capacity of 45,000 metric
tons per annum (mtpa) of cast iron spun pipes and pipe fittings in December, 1964.
The Company subsequently diversified into the manufacturing of Cement and in 1969
established its first cement plant under the name 'Kesoram Cement' at Basantnagar, Dist.
Karimnagar (Andhra Pradesh) and to take advantage of favorable market conditions, in
1986 another cement plant, known as 'Vasavadatta Cement', was commissioned by it at
Sedam, Dist.
Gulbarga (Karnataka). The cement manufacturing capacities at both the plants were
augmented from time to time according to the market conditions and as on 31.3.2009
Kesoram Cement and Vasavadatta Cement have annual cement manufacturing capacities
of 1.5 million metric tons and 4.1 million metric tons respectively.
The Company in March 1992, commissioned a plant at Balasore known as Birla Tyres in
Orissa, for manufacturing of 10 lakh mtp.a. automotive tyres and tubes in the first phase in
collaboration with Pirelli Ltd., U.K., a subsidiary company of the world famous Pirelli Group
of Italy - a pioneer in production and development of automotive tyres in the world.
The capacity at the said plant was further augmented during the year by 19 MT per day
aggregating to 271 MT per day production facility. The Greenfield Project of 257 MT per
day capacity in the State of Uttarakhand with a capex of about Rs.760 crores commenced
the commercial production in phases during the financial year 2008-09.The Company as
on 31.3.2009 had the manufacturing capacities of 3.71 million tyres, 2.95 million tubes
and 1.53 million flaps per annum in the Plants including at Uttarakhand Plant. It has small
manufacturing capacities of various Chemicals at Kharda in the State of West Bengal also.
It has the annual manufacturing capacities of 12,410 mtpa of Caustic Soda Lye, 5,045
mtpa of Liquid Chlorine, 6,205 mtpa of Sodium Hypochlorite, 8,200 mtpa of
Hydrochloric Acid, 3,200 mtpa of Ferric Alum, 18,700 mtpa of Sulphuric Acid and
1,620,000 m3pa of purified Hydrogen Gas.
The Company is a well-diversified entity in the fields of Cement, Tyre, Rayon Yarn,
Transparent Paper, Spun Pipes and Heavy Chemicals with two core business segments i.e.
Cement and Tyres.
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In Spun Pipes & Foundries, a unit of the Company, work suspended from 2nd May, 2008
still commences till further notice.
The Company as of now is listed on three major Stock Exchanges in India i.e. Bombay
Stock Exchange Ltd., Mumbai, Calcutta Stock Exchange Association Ltd., Kolkata and
National Stock Exchange of India Ltd., Mumbai and at the Societe de la Bourse de
Luxembourg, Luxembourg.
A further expansion upto 1.65 million tons of cement per annum in Vasavadatta Cement
at Sedam in Karnataka as unit IV at the same site is in progress, with a 17.5 MW Captive
Power Plant, involving a capital expenditure of about Rs. 783.50 crores (including the
cost of Captive Power Plant).
The commercial production of cement in the aforesaid unit IV has commenced in June
2009. The work for the further expansion in the Tyres Section at Uttarakhand for radial
tyres with 100 MT per day capacity and bias tyres with 125 MT per day capacity
involving an estimated aggregate capital outlay of about Rs. 840 crores is under progress.
The Board has further approved a Motor Cycle Tyre Project of 70 MT per day capacity at
the same site involving a capital outlay of Rs.190 crore. The civil construction of both the
Projects is in full swing. The commercial production in both the Projects is likely to start
by December 2009/ January 2010.
Birla Supreme in popular brand of Kesoram cement from its prestigious plant of
Basantnagar in AP which has outstanding track record. In performance and productivity
serving the nation for the last two and half decades. It has proved its distinction by
bagging several national awards. It also has the distinction of achieving optimum capacity
utilization.
Kesoram offers a choice of top quality portioned cement for light, heavy
constructions and allied applications. Quality is built every fact of the operations.
The plant lay out is rational to begin with. The limestone is rich in calcium
carbonate a key factor that influences the quality of final product. The day process
technology uses in the latest computerized monitoring overseas the manufacturing
process. Samples are sent regularly to the bureau of Indian standards. National council of
construction and building material for certification of derived quality norms.
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The company has vigorously undertaking different promotional measures for
promoting their product through different media, which includes the use of news papers
magazine, hoarding etc.
Kesoram cement industry distinguished itself among all the cement factories in
Indian by bagging the National Productivity Award consecutively for two years i.e. for the
year 1985-1987. The federation of Andhra Pradesh Chamber & Commerce and Industries
(FAPCCI) also conferred on Kesoram Cement. An award for the best industrial promotion
expansion efforts in the state for the year 1984. Kesoram also bagged FAPCCI awarded
for “Best Family Planning Effort in the state” for the year 1987-1988.
One among the industrial giants in the country today, serving the nation on the
industrial front. Kesoram industry ltd. has a checked and eventful history dating back to
the twenties when the Industrial House of Birla’s acquired it. With only a textile mill
under its banner 1924, it grew from strength to strength and spread its activities to newer
fields like Rayon, Transparent paper, pipes, Refractors, tyres and other products.
Looking to the wide gap between the demand and supply of vital commodity
cement, which play in important role in National building activity the Government of
India, had de-licensed the cement industry in the year 1966 with a review to attract private
entrepreneur to augment the cement production. Kesoram rose to the occasions and
divided to set up a few cement plants in the country.
Kesoram cement undertaking marketing activities extensively in the state of
Andhra Pradesh, Karnataka, Tamilnadu, Kerala, Maharashtra and Gujarat. In A.P. sales
Depts., are located in different areas like Karimnagar, Warangal, Nizamabad, Vijayawada
and Nellore. In other states it has opened around 10 depots.
The market share of Kesoram Cement in AP is 7.05%. The market share of the
company in various states is shown as under.
STATES MARKET SHARE
Karnataka 4.09% 0.94%
Tamilnadu 0.29% 2.81%
Kerala
Maharashtra
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Process and Quality Control:
It has been the endeavor of Kesoram to incorporate the World’s latest technology
in the plant and today the plant has the most sophisticated.
X-ray analysis:
Fully computerized XRF and XRD X-RAY Analyzers keep a constant round the
clock vigil on quality.
Supreme performance:
One of the largest Cement Plants in Andhra Pradesh, the plant incorporate the
latest technology in Cement - making.
It is professionally managed and well established Cement Manufacturing Company
enjoying the confidence of the consumers. Kesoram has outstanding track record in
performance and productivity with quite a few national and state awards to its credit.
BIRLA SUPREME, the 43 Grade Cement, is a widely accepted and popular brand
in the market, commanding a premium.
However to meet the specific demands of the consumer, Kesoram bought out the
53 grade BIRLA SUPREME – GOLD, which has special qualities like higher fineness,
quick-setting, high compressive strength and durability.
Supreme Strength:
Kesoram Cement has huge captive Limestone Deposits, which make it possible to
feed high- grade limestone consistently, its natural Grey colour is anion- born ingredient
and gives good shade.
Both the products offered by Kesoram, i.e. BIRLA SUPREME-43 Grade and
BIRLA SUPREME-GOLD-53 Grade cement are outstanding with much higher
compressive strength and durability.
The following characteristics show their distinctive qualities.
Comprehensive Opc 43 Birla Opc 43 gr Birla

Strength grls 8112 Supreme 43 Is 1226987 Supreme
1989 grade Gold 53 gr
3 days mpa Min. 23 31 + Min. 27 38+
7 days mpa Min. 23 42+ Min. 37 48+
28 days mpa Min. 43 50+ Min. 53 60+
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D.C. SYSTEM:
Clinker making process is a key step in the overall cement making process. In the case of
BIRLA SUPREME/GOLD, the clinker-making process is totally computer. control. The
Distributed Control System (DCS) constantly monitors the process and ensures operating
efficiency. This eliminates variation and ensures consistency in the quality of Clinker.
Physical Characteristics:
Ope 43 Birla Ope 53 gr Birla Supreme
Is 8 112-89 Supreme Is 12269-87 Gold 53 gr
43 grade
Setting time Min30 120-180 Min 30 130-170
a. Initial (mats) Max 600 180-240 Max 600 170-220
b. final (mats) Min 225 270-280 . Min 225 300-320
Fincncssm 2/Kg Max 10 1.0-2.0 Max 10 0.5-1.0
Soundness Max 0.8 0.04-0.08 Max 0.080. 0.04-0.2
a. le-chart (mm)
b. autoclave (%)
Supreme Expertise:
The Best Technical Team, exclusive to Kesoram, mans the Plant and monitors the
process, to blend the cement in just the required proportions, to make BIRLA
SUPREME/GOLD OF Rock Strength.
18 Million Tones of Solid Foundation:

Staying at the top for over a Quarter Century, Quarter Century is no less an achievement.
Infact. Kesoram is synonymous with for over 28 years.
Over the years, Kesoram has dispatched 18 million tones of cement to the nook and corners of
the country and joined hands in strengthening the Nation. No one else in Andhra Pradesh has
this distinction. The prestigious World Bank aided Ramagundam Super Thermal Power
Project of NTPC and Mannair Dam of Pochampad project in AP arc a couple of projects for
which Kesoram Cement was exclusively uses: to cite an example.
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Chemical Characteristics:
Opc 43 gr Birla Ope 53 gr Birla
Is 81 132-989 Supreme Is 12269- Supreme
43 grade 87 Gold 53 gr.
Loss on inflection % Max 5 <1.6 Max 4.0 <1.5
Insoluble residue % Max 2.0 <0.8 Max 2.0 < 0.6
Magnesium oxide % Max 6.0 < 1.3 Max 6.0 < 1.3
Lime saturation factor 0.66-1.02 0.8-0.9 0.8-1.02 0.88-0.9
Alumna: iron ratio MinO.66 1.5-1.7 MinO.66 1.5-1.7
Sulfuric anhydride % Max 2.5/3 1.6-2.0 Max 2. 5/3 1.6-2.0

Alkalis Chlorides Max 0.05 Max 0.01 Max 0.05 Max 0.4
Kesoram Cement - advantages:

Helps in designing sleeker and more elegant.
Structures, giving greater flexibility in design concept.
Due to its fine quality, super fine construction can be achieved.. Its gives maximum
strength at Minimum use of cement with water in the water cement ratio, especially the 53
grade Birlas supreme-gold.
Feathers in Kesoram's cap:
Kesoram has outstanding track record, achieving over 100% capacity utilization I
productivity and energy conservation. It has proved its distinction by bagging several
national and state awards, noteworthy being.
NATIONAL:
1. National productivity award for 1985-86
2. National productivity award for 1986-87
3. National award for mines safety for 1985-86
4. National award for mines safety for 1986-87
5. National award for energy conservation 1989-90
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STATE
1. A.P. State productivity award for 1988
2. State award for best industrial management 1988-89.
3. Best industrial productivity award of FAPCCI (federation of A.P. chamber of
commerce and industry), 1991
4. Best management award of the state Govt. 1993
5. FAPCCI award for the workers welfare, 1995-96.
I.S.O. 9002
All quality systems of Kesoram have been certified under I.S.O. 9002/1.S. 4002, which
proves the worldwide acceptance of the products.
All quality systems in production and marketing of the product have been certified by
B.I.S. under ISO 9002/1S 14002.
The first unit was installed at basanthnagar with a capacity of 2.5 –lakhs TPA (tones per
annum) incorporating humble supervision, preheated system, during the year 1969.
The second unit followed suit with added a capacity of 2 lakhs TPA in 1971.
The plant was further expanded to 9 lakhs by adding 2.5 lakhs tones in august 1978, 1.13
lakhs tones in January 1981 and 0.87 lakhs tones in September 1981.
Power:
Singareni collieries make the supply of coal for this industry and the power was
obtained from AP TRANSCO. The power demand for the factory is about 21MW.
Kesoram has got 2-diesel generator seats of 4 MW each installed in the year 1987.
Kesoram cement now has a 15MWcaptive power plant to facilities for
uninterrupted power supply for manufacturing of cement.
Performance:
The performance of kersoram cement industry has been outstanding achieving
over cent percent capacity utilization all through despite many odds like power cuts and
which most 40% was wasted due to wagon shortage etc.
The company being a continuous process industry works round the clock and has
excellent records of performance achieving over 1005 capacity utilization.
Kesoram has always combined technical progress with industrial performance. The
company had glorious track record for the last 27 years in the industry.
Technology:
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Kesoram cement uses most modern technology and the computerized control in
the plant. A team of dedicated and well- experienced experts manages the plant.
The quality is maintained much above the bureau of Indian
standards. The raw materials used for manufacturing cement are:
Lime stone
Bauxite
Hematite
Gypsum
Environmental and Social Obligations:
For environmental promotion and to keep –up the ecological balance, this section
has planted over two lakhs trees .on social obligation front ,this section has undertaken
various social welfare programs by adopting ten nearly villages, organizing family
welfare campus, surgical camps, animal health camps blood donation camps, children
immunization camps, seeds, training for farmers etc were arranged.
Welfare and Recreation Facilities:
For the purpose of recreation facilities 2 auditoriums were provided for playing
indoor games, cultural function and activities like drama, music and dance etc.
The industry has provided libraries and reading rooms. About 1000 books are available in
the library. All kinds of newspaper, magazines are made available.
Canteen is provided to cater to the needs of the employees for supply of snacks,
tea, coffee and meals etc.
One English medium and one Telugu medium school are provided to meet the
educational requirements.
The company has provided a dispenser with a qualified medical office and
paramedical staff for the benefit of the employees. The employees covered under ESI
scheme have to avail the medical facilities from the ESI hospital.
Competitions in sports and games are conducted every year for august 15th
Independence Day and January 26th, republic day among the
employees. Electricity:
The power consumption per ton of cement has come down to 108 units against 113
units last year, due to implementation of various energy saving measures. The performance of
captive power plant of this section continues to be satisfactory. Total power generation
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during the year was 84 million units last year. This captive power plant is a major role in
keeping power costs with in economic levels.
The management has introduced various HRD programs for training and
development and has taken various other measures for the betterment of employee’s
efficiency.
The section has installed adequate air pollution control system and equipment and is
ISO14001 such as Environment management system is under implementation.
Awards:
Kesoram cement bagged many prestigious awards including national awards for
productivity, technology, conservation and several state awards since 1984. The following
are the some of important awards.
AWARDS OF KESORAM CEMENT:

National/
No Year Awards State
1 1989-90 Management award community State
Development
2 1991 Energy conservation may day award of the State
Govt.
3 1991 Pundit Jawaharlal Nehru rolling trophy for State
best
4 1993 National productivity effort Indira Gandhi State
national award
5 1994 Best management award State
6 1994- Best industrial rebellion award State

1995
7 1995 Rural development by chief minister State
Environment and mineral conservation
award
8 1995 Best industrial rebellion award State
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9 1995- Best effort of an industrial unit to National
1996 development rural economy shri.S.R.Rungta
award for social
10 1996 Awareness for best rural development State
efforts
11 1999 Best workers welfare best family welfare State
award
12 2001 First prize for mine environment &pollution State
control for the 3rd year in succession
13 2002 Vana mithra award from AP Govt State
14 2003 Company has got OHSAS-18001 State
15 2005 Certification from DNV, New Delhi. State
16 2006 Award for pollution control and State

environmental protection FAPCCI award
for best rural development in the state
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Products of the organization:
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CHAPTER-III
LITERATURE REVIEW
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Introduction:
Financial Performance Analysis:
The term ‘financial performance analysis also known as analysis and interpretation of
financial statements’ , refers to the process of determining financial strength and
weaknesses of the firm by establishing strategic relationship between the items of the
balance sheet , profit and loss account and other operative data.
“Analyzing financial statements” by Metcalf and Titard
“Financial analysis is a process of evaluating the relationship between component
parts of a financial statement to obtain a better understanding of a firms position and
performance” by Myers
Financial Performance:
The word ‘Performance is derived from the word ‘parfourmen’, which means ‘to do’, ‘to
carry out’ or ‘to render’. It refers the act of performing, execution, accomplishment,
fulfillment etc. In border sense, performance refers to the accomplishment of a given task
measured against preset standards of accuracy, completeness, cost, and speed. In other
words, it refers to the degree to which an achievement is being or has been accomplished.
In the Words of Frich Kohlar “The performance is a general term applied to a part or to all
the conducts of activities of an organization over a period of time often with reference to
past or projected cost efficiency, management responsibility or accountability or the like.
Thus, not just the presentation, but the quality of results achieved refers to the
performance. Performance is used to indicate firm’s success, conditions, and compliance.
Financial performance refers to the act of performing financial activity. In broader

sense, financial performance refers to the degree to which financial objectives being or has
been accomplished. It is the process of measuring the results of a firm's policies and
operations in monetary terms. It is used to measure firm's overall financial health over a
given period of time and can also be used to compare similar firms across the same
industry or to compare industries or sectors in aggregation.
The purpose of financial analysis is to diagnose the information contained in financial
statements so as to Jude the profitability and financial soundness of the firm. Just like a
doctor examines his patient by recording his body temperature, blood pressure, etc. Before
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making his conclusion regarding the illness and before giving his treatment, a financial
analyst analysis the financial statements with various tools of analysis before commenting
upon the financial health or weaknesses of an enterprise.
The analysis and interpretation of financial statements is essential to bring out the
mystery behind the figures in financial statements. Financial statements analysis is an
attempt to determine the significance and meaning of the financial statement data so that
forecast may be made of the future earnings, ability to pay interest and debt maturities
(both current and long term) and profitability of a sound divided policy.
Types of financial analysis:-

Financial analysis into different categories depending upon
(1) The material used and
(2) The method of operation followed in the analysis or the modus operandi of
analysis
Types of financial analysis
On the basis of material used on the basis of modus operandi
External Internal Horizontal Vertical
Analysis Analysis Analysis Analysis
1. On the basis of material used: - According to material used, financial analysis can
be of two types
External analysis
Internal analysis
External analysis:-
This analysis is done by outsiders who do not have access to the detailed
internal outsiders include investors, potential investors, Creditors, Potential Creditors,
Government Agencies, Credit Agencies and General Public. For financial analysis, these
external parties to the firm depend almost entirely on the published financial statements.
Internal analysis:-
This analysis is undertaken by the persons namely executives and employees of the
organization or by the officers appointed by government or court who have access to the
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books of account ( internal accounting records) and other information related to the
business.
2. On the basis of modus operandi:-
According to the modus operandi financial analysis can also be of two types
a. Horizontal analysis
b.Vertical analysis
Horizontal analysis:-
Horizontal analysis refers to the comparison of financial data of a company for several
years. The figures for this type of analysis are presented horizontally over a number of
columns. The figures of the various years are compared with standard or base year. a base
year is year chosen as beginning point. This type of analysis is also called ‘dynamic
analysis’ as it is based on the data from year to year rather than on data of any one year.
The horizontal analysis makes it possible to focus attention on items that have changed
significantly during the period under view.
b. Vertical analysis:-
Vertical analysis refers to the study of relationship of the various items in the financial
statements of one accounting period. In this types of analysis the figures from financial
statement of a year are compared with a base selected from the same year’s statement
Methods of financial analysis:-

The following methods of analysis are generally used:-
1. Comparative Statements.
2. Trend Analysis.
3. Common-Size Statements.
4. Funds flow Analysis.
5. Cash Analysis
6. Ratio Analysis
7. Cost-volume-Profit Analysis
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Comparative statements:-
The comparative financial statements are statements of the financial position at
different periods of time .the elements of financial position are show in a
Comparative Statement provides an idea of financial position at two or more
periods. Generally two financial statements (balance sheet and income statement) are
prepared in comparative form for financial analysis.
The Comparative Statement May Show:-
1. Absolute figures (rupee amounts)
2. Changes in absolute figures i.e. increase or decrease in absolute figures.
3. Absolute data in terms of percentages.
4. Increase or decrease in terms of percentages.
The Two Comparative Statements Are:-

1. Comparative balance sheet, and
2. Income statement.
1. Comparative balance sheet:-
The comparative balance sheet analysis is the study of the trend of the same items, group
of items and computed items in two or more balance sheets of the same business
enterprise on different dates. The change in periodic balance sheet items reflect the
conduct of a business the change can be observed by comparison of the balance sheet at
the beginning and at the end of a period and these changes can help in forming an opinion
about the progress of an enterprise.
Guide Lines for Interpretation of Comparative Balance Sheet:-
While interpreting comparative balance sheet the interpreter is expected to study

the following aspects:-
1. Current financial position and liquidity position
2. Long-term financial position
3. Profitability of the concern.
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Common Size Statement:-
The common-size statements, balance sheet and income statement are show in
analytical percentages. The figures are shown as percentages of total assets, total liabilities
and total sales. The total assets are taken as 100 and different assets are expressed as a
percentage of the total similarly, various liabilities are taken as a part of total liabilities.
Common Size Balance Sheet:-
A statement in which balance sheet items are expressed as the ratio of each asset to
total assets and the ratio of each liability is expressed as a ratio of total liabilities is called
common size balance. The common size balance sheet can be used to compare companies
of differing size. The comparison of figures in different periods is not useful because total
figures may be affected by a number of factors. It is not possible to establish standard
norms for various assets. The trends of figures from year to year may not be studied and
even they may not give proper results.
Trend Analysis of Balance Sheet:-

Trend analysis is Very important tool of horizontal financial analysis.
This analysis enables to known the change in the financial function and operating
efficiency in between the time period chosen.
By studding the trend analysis of each item we can known the direction of changes and
based upon the direction of changes, the options can be changed.
Trend =Absolute Value of item in the statement understudy
*100 Absolute Value of same item in the base statement
Ratio Analysis:
Ratio analysis is used as a technique of analyzing the financial information, contained in
the balance sheet and profit and loss accounts, for a more meaningful understanding of the
financial position and performance of a firm.
The relationship between two accounting figures, expressed mathematically, is known as
a financial ratio. A ratio helps the analyst to make qualitative judgment about the firm’s
financial position and performance.
Several ratios can be calculated from the accounting data contained in the financial
statements. The parties which generally undertake financial analysis is short –term
creditors, long-term creditors, owner and management. In view of the requirements of the
various ratios, ratios are classified into the following four important categories.
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Liquidity ratios
Leverage ratios
Activity ratios
Profitability ratios
Liquidity Ratios:
It is extremely essential for a firm to be able to meet its obligations as they become due.
Liquidity ratios measure the ability of the firm to meet its current obligations. A firm should
ensure that it does not suffer from lack of liquidity, and also that it does not have excess
liquidity. The failure of a company to meet its obligations due to lack of sufficient liquidity,
will result in a poor creditworthiness, loss of creditors’ confidence, or even in legal tangles
resulting in the closure of the company. A very high degree of liquidity is also bad; idle assets
earn nothing. The firm’s funds will be unnecessarily tied up in current assets. Therefore it is
necessary to strike a proper balance high liquidity and lack of liquidity.
The most common ratios which indicate the extent of liquidity or lack of it
are Current ratio
Quick ratio
Other ratios include Cash ratio, Interval Measure and Net working capital ratio.
Current Ratio:
The current ratio is calculated by dividing current assets by current liabilities.
Current assets Current
ratio = --------------------------
Current liabilities
Current ratio is a measure of the firm’s short term solvency. It indicates the availability of
current assets in rupees for every one rupee of current liability. A ratio of greater than one
means that the firm has more current assets than current claims against the, Current ratio
of 2 to 1 or more is considered satisfactory. Current ratio represents a margin of safety for
creditors.
Quick Ratio:
Quick ratio also known as acid-test ratio establishes a relationship between quick assets
and the current liabilities. Cash is the most liquid asset. It is calculated by dividing quick
assets by current liabilities.
Quick ratio = Quick Assets / Current Liabilities
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(Quick Assets = Current assets – Inventory)
One defect of the current ratio is that it fails to convey any information on the composition
of the current assets of the firm. A rupee of cash is considered equivalent to a rupee of
inventory of receivables. But it is not so. A rupee of cash is more readily available to meet
current liabilities than a rupee of say inventory. This implies the usefulness of the current
ratio.
The Acid –test ratio measures the firm’s ability to convert its current assets quickly into
cash in order to meet its current liabilities.
A quick ratio of 1 to 1 is considered to represent a satisfactory current financial condition.
It is an important index of the firm’s liquidity.
Leverage Ratios:
Leverage ratios identify the source of a firm’s capital –owners or outside creditors. Financial
leverage refers to the use of debt in financing non-current assets. If the return on assets
exceeds the cost of debt, the leverage is successful – i.e., it improves return on equity.
Debt –Equity Ratio:
The Debt – Equity is determined to analyze the soundness of the long term financial
policies of the organization. It is also known as “Internal External Equity Ratio”.
It is calculated as follows:
Debt – Equity Ratio = Total long term debt / Share holders funds.
Equity Ratio:
This ratio is also called as proprietary ratio establishes a relationship between share
holder’s funds to total assets of company. Equity Ratio is calculated by dividing share
holders fund by total assets.
Fixed Asset Ratio:
This ratio indicates the extent to which the assets of the company’s can be lost without
affecting the interest of the creditors of the company. Higher the ratios better the long-
term position of the company.
Activity Ratios:
They are primarily used for studying a firm’s working capital situation. A well managed
firm should have good activity ratios.
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Working Capital Turnover Ratio:
The working capital turnover ratio indicates whether or not working capital has been
effectively used in making sales.
Working capital turnover = Sales / Net current assets
Inventory Turnover Ratio:

This ratio also known as Stock Turnover Ratio establishes the relationship between costs
of goods sold or net sales during the given period and the average amt of stock held during
the period. This ratio reveals the number of times finished stock in turnover during a given
accounting period.
Higher the ratio the better is it because it shows the finished stock is rapidly
turned in to sales. On the other hand, a low stock turnover ratio is not desirable, because it
reveals the accumulation of stock.
Debtors Turnover Ratio:

This ratio indicates the velocity of debt collection of a company. In other words it shows
the number of times average turnover during a year.
A Higher Debtor Turnover Ratio indicates a more efficient is the management towards
debtors and low ratio ratio implies inefficient management of debtors.
Total Assets Turnover Ratio:

The asset turnover ratio indicates how efficiently management is employing
Assets. Total Assets Turnover Ratio = Sales / Total Assets
Profitability Ratios:
Profitability ratios are the ratios which measure a firm’s overall effectiveness as revealed
by the returns generated on sales and investment.
General Profitability Ratios:
1. Gross Profit Ratio
2. Net profit Ratio
3. Operating or Expenses Ratio.
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Gross Profit Ratio:
Gross profit Ratio measures the relationships to net sales and is usually represented as a
percentage. It is a good measure of profitability.
The gross profit ratio indicates the extent to which selling price of goods per unit may
decline without resulting in losses on operation. Higher the gross profit betters the result.
Net Profit Ratio:
Net Profit Ratio indicates net margin on sales. It is given by the following
equation. Net Profit Ratio = (Net Profit / Sales) * 100
Operating or Expenses Ratio:

This ratio is complimentary of Net Profit Ratio. The more the net profit, the less
the Operating Ratio. Operating costs include the cost of direct materials, direct labors and
other overheads, viz., are generally excluded from operating costs. A comparison of the
Operating Ratio will indicate whether the cost efficiency is high or low in the figure of
sales. This less the ratio it depicts the efficiency of the management.
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CHAPTER IV
DATA ANALYSIS & INTERPRETATION
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Comparative Balance Sheet of Kesoram in the Year between 2008-2009
(Rupee in crores)
Years Changes
Particulars 2008 2009 In Rupees In Percentage
Liabilities
\Share Capital 45.74 45.74 0.00 0.00
Reserves & Surplus 930.85 1280.24 349.39
Revaluation Reserves 5.33 4.12 -1.21 -22.70
Loans
Secured Loans 971.06 1536.27 565.21 58.21
Un Secured Loans 121.29 434.16 312.87 257.95
Deferred Tax Liabilities 0.00 0.00 0.00 0.00
Current Liabilities
Provisions 330.39 345.29 14.90 4.51
Current Liabilities 570.67 665.87 95.20 16.68
Total 2975.33 4311.69 1336.36 44.91

Assets
Net Block 1084.24 1804.35 720.11 66.42
Capital Wip 634.59 864.85 230.26 36.28
Investments 47.83 61.78 13.95 29.17
Current Assets
Inventories 442.17 589.06 146.89 33.22
Sundry Debtors 273.07 380.17 107.10 39.22
Cash & Bank Balances 40.36 56.57 16.21 40.16
Total Current Assets 755.60 1025.80 270.20 35.76
Loans & Advances 452.89 554.62 101.73 22.46
Fixed Deposits 0.18 0.28 0.10 55.56
Total 2975.33 4311.69 1336.36 44.91
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Interpretation of comparative balance sheet of 2008-2009:
Reserves & Surplus were increased to 37.53 % (percent) i.e., in Rupees 349.39
crores.
Revaluation Reserves decreased to 1.21 % i.e., in Rupees 22.70 crores.
Secured Loans are increased to 58.21 % i.e., in Rupees 565.21 crores. And UN
secured loans highly Increased to 257.95 %.
Current liabilities and Provisions are increased to 16.68 and 4.51 respectively i.e.,
in Rupees 95.20 & 14.90 crores.
Fixed assets were highly increased to 66.42 % i.e., in Rupees 720.11 crores.
Investments were increased to 29.17 % i.e., in Rupees 13.95 crores.
Sundry debtors increased to 39.22 % i.e., in Rupees 107.10 crores.
Current assets increased 35.76 % i.e., in Rupees 270.20 crores. And Loans &
Advances increased to 22.46 % respectively.
The overall financial position was satisfactory.
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(Rupees in crores)
Years Changes
Liabilities
Share Capital 45.74 45.74 0.00 0.00
Reserves & Surplus 1280.24 1491.11 210.87 16.47
Loans
Secured Loans 1536.27 1863.72 327.45 21.31
Un Secured Loans 434.16 1262.50 828.34 190.79
Deferred Tax Liabilities 0.00 0.00 0.00
Current Liabilities
Provisions 345.29 357.34 12.05 3.49
Total 4311.69 6100.68 1788.99 41.49

Assets
Net Block 1804.35 3431.82 1627.47 90.20
Capital WIP 864.85 412.83 -452.02 -52.27
Investments 61.78 51.43 -10.35 -16.75
Current Assets
Inventories 589.06 916.19 327.13 55.53
Sundry Debtors 380.17 542.89 162.72 42.80
Loans & Advances 554.62 665.06 110.44 19.91
Fixed Deposits 0.28 0.31 0.03 10.71
Total 4311.69 6100.68 1788.99 41.49
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Reserves & surplus increased to 16.47 % i.e., in Rupees 210.87 crores.
Secured loans increased to 21.31% i.e., in Rupees 327.45 crores.
Current Liabilities were increased to 61.73 % i.e., in Rupees 411.01 crores, and
Provisions 3.49 % i.e., in Rupees 12.05 crores.
Fixed Assets were increased to 90.20 % i.e., in Rupees 1627.47 crores.
Investments were decreased to 16.75 % i.e., in Rupees 10.35 crores.
Sundry debtors were increased to 42.80 % i.e., in Rupees 162.72 crores.
Current assets increased to 50.05 % i.e., in Rupees 513.42 crores. And loans and
Advances increased 19.19 % i.e., in Rupees 110.44 crores.
The overall financial position was satisfactory.
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(Rupees in crores)
Years Changes
Liabilities
Share Capital 45.74 45.74 0.00 0.00
Reserves & Surplus 1491.11 1251.62 -239.49 -16.06
Loans
Secured Loans 1863.72 2371.83 508.11 27.26
Un Secured Loans 1262.50 1627.44 364.94 28.91
Current Liabilities
Provisions 357.34 14.94 -342.40 -95.82
Total 6100.68 6453.48 352.80 5.78

Assets
Net Block 3431.82 3691.72 259.90 7.57
Capital WIP 412.83 437.81 24.98 6.05
Investments 51.43 65.82 14.39 27.98
Current Assets
Inventories 916.19 1118.55 202.36 22.09
Sundry Debtors 542.89 631.34 88.45 16.29
Cash & Bank Balances 80.14 71.88 -8.26 -10.31
Loans & Advances 665.06 434.60 -230.46 -34.65
Fixed Deposits 0.31 1.76 1.45 467.74
Total 6100.68 6453.48 352.80 5.78
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Reserves & surplus decreased to 16.06 % i.e., in Rupees 239.49 crores.
Secured loans increased to 27.26 % i.e., in Rupees 508.11 crores.
Current Liabilities were increased to 5.77 % i.e., in Rupees 62.14 crores
Provisions decreased to 95.82 % i.e., in Rupees 342.40 crores.
Fixed Assets were increased to 7.57 % i.e., in Rupees 259.90 crores.
Investments were decreased to 27.98 % i.e., in Rupees 14.39 crores.
Sundry debtors were increased to 16.29 % i.e., in Rupees88.45 crores.
Current assets increased to 18.36 % i.e., in Rupees 282.55 crores. And loans and
The overall financial position was UN satisfactory.
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Comparative Balance Sheet of Kesoram In The Year Between 2011-2012
(Rupees in crores)
Years Changes
Liabilities
Share Capital 45.74 45.74 0.00 0.00
Reserves & Surplus 1251.62 866.57 -385.05 -30.76
Loans
Secured Loans 2371.83 3177.92 806.09 33.99
Un Secured Loans 1627.44 927.42 -700.02 -43.01
Current Liabilities
Provisions 14.94 407.26 392.32 2625.97
Total 6453.48 7227.71 774.23 12.00

Assets 0.00
Net Block 3691.72 3587.21 -104.51 -2.83
Capital WIP 437.81 680.65 242.84 55.47
Investments 65.82 66.36 0.54 0.82
Current Assets
Inventories 1118.55 995.16 -123.39 -11.03
Sundry Debtors 631.34 673.58 42.24 6.69
Cash & Bank Balances 71.88 69.59 -2.29 -3.19
Total Current Assets 1821.77 1738.33 -83.44 -4.58
Loans & Advances 434.60 1154.09 719.49 165.55
Fixed Deposits 1.76 1.07 -0.69 -39.20
Total 6453.48 7227.71 774.23 12.00
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Reserves & surplus decreased to 30.76 % i.e., in Rupee 385.05 crores.
Secured loans increased to 33.99 % i.e., in Rupees 806.99 crores.
Current Liabilities were increased to 58.04 % i.e., in Rupees 661.08 crores
Provisions increased to 2625.97 % i.e., in Rupees 392.32 crores.
Fixed Assets were decreased to 2.83 % i.e., in Rupee 104.51 crores.
Investments were increased to 0.82 % i.e., in Rupees 0.54 crores.
Sundry debtors were increased to 6.69 % i.e., in Rupees 42.24 crores.
Current assets decreased to 4.58 % i.e., in Rupees 83.44 crores. And loans and
The overall financial position was UN satisfactory.
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Common Size Balance Sheet of Kesoram For The Year 2008-2009
(Rupees in crores)
Particulars 2008 Change Percentage 2009 Change Percentage

Liabilities
Share Capital 45.74 1.54 45.74 1.06
Revaluation Reserves 5.33 0.18 4.12 0.10
Loans
Secured Loans 971.06 32.64 1536.27 35.63
Un Secured Loans 121.29 4.08 434.16 10.07
Current Liabilities
Provisions 330.39 11.10 345.29 8.01
Total 2975.33 100.00 4311.69 100.00

Assets
Net Block 1084.24 36.44 1804.35 41.85
Capital WIP 634.59 21.33 864.85 20.06
Investments 47.83 1.61 61.78 1.43
Current Assets
Inventories 442.17 14.86 589.06 13.66
Sundry Debtors 273.07 9.18 380.17 8.82
Loans & Advances 452.89 15.22 554.62 12.86
Fixed Deposits 0.18 0.01 0.28 0.01
Total 2975.33 100.00 4311.69 100.00
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54

Interpretation of Common Size Balance Sheet of 2008-2009:
Share capital was recorded 1.54 percent in the total liabilities in the year 2008 it is
decreased to 1.06 % in the year 2009.
Reserves & surplus contributed to 31.29 % in the total liabilities in the year 2008 it is
Secured loans were 32.64 % in the total liabilities in the year 2008 it is increased to
35.63 % in the year 2009.
Current Liabilities shown to 19.18 % in the total liabilities in the year 2008 it is
Provisions 11.10 in the total liabilities in the year 2008 it is decreased to 8.01 % in
the year 2009.
Fixed Assets were 36.44 in the total liabilities in the year 2008 i.e., decreased to
41.85 % in the year 2009.
Investments were 1.61 in the total liabilities in the year 2008 it is decreased to 1.43
% in the year 2009.
Sundry debtors were 9.18 in the total liabilities in the year 2008 it is decreased to
8.82 % in the year 2009.

55

Common Size Balance Sheet of Kesoram For The Year 2009-2010
(Rs in crores)
Change
Particulars 2009 Change Percentage 2010 Percentage
Liabilities
Share Capital 45.74 1.06 45.74 0.75
Loans
Secured Loans 1536.27 35.63 1863.72 30.55
Un Secured Loans 434.16 10.07 1262.50 20.69
Current Liabilities
Provisions 345.29 8.01 357.34 5.86
Total 4311.69 100.00 6100.68 100.00

Assets
Net Block 1804.35 41.85 3431.82 56.25
Capital WIP 864.85 20.06 412.83 6.77
Investments 61.78 1.43 51.43 0.84
Current Assets
Inventories 589.06 13.66 916.19 15.02
Sundry Debtors 380.17 8.82 542.89 8.90
Loans & Advances 554.62 12.86 665.06 10.90
Fixed Deposits 0.28 0.01 0.31 0.01
Total 4311.69 100.00 6100.68 100.00

56

Interpretation of common size balance sheet of 2009-2010
Share capital was recorded 1.06 percent in the total liabilities in the
year 2009 it is decreased to 0.75 % in the year 2010.
Reserves & surplus contributed to 29.69 % in the total liabilities in

the year 2009 it is decreased to24.44 % in the year 2010.
Secured loans were 35.63 % in the total liabilities in the year 2009 it
is increased to 30.55 % in the year 2010.
Current Liabilities shown to 15.44 % in the total liabilities in the year

2009 it is decreased to 17.65 % in the year 2010.
Provisions 8.01 in the total liabilities in the year 2009 it is decreased

to 5.86 %in the year 2010.
Fixed Assets were 41.85 in the total liabilities in the year 2009 i.e.,
increased to 56.25 % in the year 2010.
Investments were 1.43 in the total liabilities in the year 2009 it is
Sundry debtors were 8.82 in the total liabilities in the year 2009 it is

57

Common Size Balance sheet of Kesoram for the year 2010-2011
(Rupees in crores)
Change
Liabilities
Share Capital 45.74 0.75 45.74 0.71
Loans
Secured Loans 1863.72 30.55 2371.83 36.75
Un Secured Loans 1262.50 20.69 1627.44 25.22
Current Liabilities
Provisions 357.34 5.86 14.94 0.23
Total 6100.68 100.00 6453.48 100.00

Assets
Net Block 3431.82 56.25 3691.72 57.21
Capital WIP 412.83 6.77 437.81 6.78
Investments 51.43 0.84 65.82 1.02
Current Assets
Inventories 916.19 15.02 1118.55 17.33
Sundry Debtors 542.89 8.90 631.34 9.78
Loans & Advances 665.06 10.90 434.60 6.73
Fixed Deposits 0.31 0.01 1.76 0.03
Total 6100.68 100.00 6453.48 100.00

58

Interpretation of Common Size Balance Sheet Of 2010-2011:
Reserves & surplus contributed to 24.44 % in the total liabilities in the year 2010 it is
decreased to19.39 % in the year 2011.
36.75 % in the year 2011.
also17.65 % in the year 2011.
Provisions 5.86 in the total liabilities in the year 2010 it is decreased to 0.23 %in the
year 2011.
Fixed Assets were 56.25 in the total liabilities in the year 2010 i.e., increased to
57.21 % in the year 2011.
Investments were 0.84 in the total liabilities in the year 2010 it increased to 1.02 %
in the year 2011.
Sundry debtors were 8.90 in the total liabilities in the year 2010 it is increased to
9.78 % in the year 2011.

59

Common Size Balance Sheet of Kesoram for the Year 2011-2012:
(Rupees in crores)
Change
Liabilities
Share Capital 45.74 0.71 45.74 0.63
Loans
Secured Loans 2371.83 36.75 3177.92 43.97
Un Secured Loans 1627.44 25.22 927.42 12.83
Current Liabilities
Provisions 14.94 0.23 407.26 5.63
Total 6453.48 100.00 7227.71 100.00

Assets
Net Block 3691.72 57.21 3587.21 49.63
Capital WIP 437.81 6.78 680.65 9.42
Investments 65.82 1.02 66.36 0.92
Current Assets
Inventories 1118.55 17.33 995.16 13.77
Sundry Debtors 631.34 9.78 673.58 9.32
Loans & Advances 434.60 6.73 1154.09 15.97
Fixed Deposits 1.76 0.03 1.07 0.01
Total 6453.48 100.00 7227.71 100.00

60

Interpretation of common size balance sheet of 2011-2012:
decreased to 0.63% in the year 2012.
Reserves & surplus contributed to 19.39 % in the total liabilities in the year 2011 it
is decreased to 11.99 % in the year 2012.
43.97 % in the year 2012.
Provisions 0.23 in the total liabilities in the year 2011 it is increased to 5.63 %in
the year 2012.
Fixed Assets were 57.21 in the total liabilities in the year 2011 i.e., decreased to
49.63 % in the year 2012.
Investments were 1.02 in the total liabilities in the year 2011 it increased to 0.92 %
in the year 2012.
Sundry debtors were 9.78 in the total liabilities in the year 2011 it is decreased to
9.32 % in the year 2012.

61

Trend Analysis
Share Capital:-
Amount Increase/Decrease
Year (In Crores) Trend % Base Year Previous Year
2008 45.74 100.00 0.00 0.00
2009 45.74 100.00 0.00 0.00
2010 45.74 100.00 0.00 0.00
2011 45.74 100.00 0.00 0.00
2012 45.74 100.00 0.00 0.00
Trend Percentages in Share Capital:
Share capital shown a constant trend in the period 2008 and 2012.
Share capital is 45.74 crores all the years from 2008-2012.

Reserves & Surplus:-
2008 930.85 100.00 0.00 0.00
2009 1280.24 137.53 37.53 37.53
2010 1491.11 160.19 60.19 22.66
2011 1251.62 134.46 34.46 -25.73
2012 866.57 93.09 -6.91 -41.37
Trend Percentages in Reserves & Surplus:
Reserves & surplus shown an increasing trend in the period between 2008 and
2010. The average trend was 132.77 % till 2010.
The Reserves & surplus was showing decreasing trend in the period 2011-2012
(i.e. from 160.19 % in 2010 to 93.09 % in 2012).
The decreasing trend in Reserves & surplus indicates the decrease in profits of the
firm.

Investments:-
2008 47.83 100.00 0.00 0.00
2009 61.78 129.17 29.17 29.17
2010 51.43 107.53 7.53 -21.64
2011 65.82 137.61 37.61 30.09
2012 66.36 138.74 38.74 1.13
Trend Percentages in Investments:-
The investments are shown an increasing trend in the period between 2008 – 2009
and it is decreasing in the year 2010.
The average trend was 114.58. % till 2009.
The investments increased in the periods 2011-2012 (i.e. from 107.53 % in 2010 to
138.74 % in 2012).
The overall trend in investments shown is satisfactory.

Net Current Assets:-
2008 307.61 100.00 0.00 0.00
2009 569.54 185.15 85.15 85.15
2010 770.37 250.44 150.44 65.29
2011 1104.17 358.95 258.95 108.51
2012 686.13 223.05 123.05 -135.90
Trends in Net Current Assets:-
The NCA shown positive (increasing) trend.

The NCA are increased to 358.95 % (the year 2011) compared with base year and
decreased in the year 2012 to 223.05 %.
The NCA shown increased trend from year and crossed 100
%. The overall trend was good.

Ratio Analysis:-
Current Ratio:-
Current Ratio = Current Assets/ Current Liabilities
Current assets are cash in hand, Cash at bank, Marketable Securities(short term) short
term Investment, Bills receivables, sundry debtors, Inventories, (stock) Work in progress,
prepaid expenses. Current Liabilities are outstanding expenses, Bills payable, sundry
Creditors, short-term advances, income tax payable and Dividend payable.
Current Ratio of Kesoram:-
(Rupees in crores)
Year Current Assets Current Liabilities Current Ratio

2007-08 755.60 570.67 1.32
2008-09 1025.80 665.87 1.54
2009-10 1539.22 1076.88 1.43
2010-11 1821.77 1139.02 1.60
2011-12 1738.33 1800.10 0.97
Interpretation:-
As per the standard rule of current ratio i.e., 2:1 where current assets double the current
liabilities is considered satisfactory.
In the present analysis the current ratio of the Kesoram is not satisfactory
from the above table. It was assessed that the current ratio for all the five year is lower
(less) than the standard rule i.e., 2:1. And it is 0.97 in the year 2011-2012 (current year).
This is highly UN satisfactory.

66

Quick Ratio:-
Quick ratio also known as acid-test ratio establishes a relationship between
quick assets and the current liabilities. Cash is the most liquid asset. It is calculated by
dividing quick assets by current liabilities
.
Quick ratio = Quick Assets / Current Liabilities
(Quick Assets = Current assets – Inventory)
Quick Ratio of Kesoram:-

Rupees in crores)
Year Total Quick Current Liabilities Quick Ratio

Assets
2007-08 333.43 570.67 0.58
2008-09 436.74 665.87 0.66
2009-10 623.03 1076.88 0.58
2010-11 703.22 1139.02 0.62
2011-12 743.33 1800.10 0.41
Interpretation:-
Usually a high Quick ratio is an indication that the company is liquid and has the ability to
meet its current or liquid liabilities in time on the other hand a low Quick Ratio represents

that the company’s liquidity position is not good. The above table showing the quick
ratios of Kesoram are can’t be considered satisfactory.
Leverage Ratios:-
Debt-Equity Ratio:-
Debt-Equity Ratio = Total Long Term Debt/ Equity Share Holders Fund
Total Long term Debt= Debenture Capital + Long term loans from banks and financial
institutions + Public deposits.
Equity Share Holders fund = Equity + Reserves and Surplus.
Debt Equity Ratio of Kesoram:
(Rupees in crores)
Year Total Debt Share Holders Fund Debt Equity Ratio

2007-08 1092.35 981.92 1.11
2008-09 1970.43 1330.10 1.48
2009-10 3126.22 1540.24 2.03
2010-11 3999.27 1300.25 3.08

2011-12 4105.34 915.01 4.49

Interpretation:-
The Debt-Equity Ratio accepted standard is 0.5. This ratio reflects the relative contribution of
creditors and owners of business in its financing. From the above it is clear that the long term
debt is more than that of the share holders’ fund. So we can interpret that the firm’s assets are
financed more by the external funds rather than by the internal funds.

Fixed Asset Ratio:-
Net Sales
Fixed Asset Ratio = ……………………………..
Net Assets
Fixed Asset Ratio of Kesoram;-
(Rupees in crores)
Year Net Sales Net Assets Fixed Assets Ratio

2007-08 3002.71 3587.21 0.84
2008-09 3897.97 3691.72 1.06
2009-10 4750.62 3431.82 1.38
2010-11 5397.88 1804.35 2.99
2011-12 5918.2 1084.24 5.46
Interpretation:
This ratio indicates the extent to which the assets of the company’s can be lost without
affecting the interest of the creditors of the company. Higher the ratios better the long-
term position of the company.
The above table shows fixed assets ratio in increasing trend. Which is good for the
company?

Overall Profitability Ratios:-
Net Profit Ratio:

Net Profit Ratio indicates net margin on sales. It is given by the following equation.
Net Profit Ratio = (Net Profit / Sales) * 100
Net Profit Ratio of Kesoram:
(Rupees in crores)
Year Net Profit Sales Net Profit Ratio

2007-08 379.17 3002.71 12.63
2008-09 414.32 3897.97 10.63
2009-10 202.98 4750.62 4.27
2010-11 -281.76 5397.88 -5.22
2011-12 -381.08 5918.2 -6.44
Interpretation:
It establishes a relationship between net profits after tax and net sales, and
indicates the efficiency of the management in manufacturing, selling, administrative and
other activities of the company.
The higher the ratio the better is the profitability or performance of the business.
The above table depicts the net profit Ratio of Kesoram has decreased every year from
2007-2008 to 2011-2012.It further decreased to negative in the year 2010-11 to -5.22 and -
6.44 in the year 2011-2012. This shows constant decrease in the profits of the company.

Return on Investment:-
Net Profit
Return on Investment = ………………………………. X 100
Share Holders Fund
Return on Investment Ratio of Kesoram:-

(Rupees in crores)
Year Net Profit Share Holders Fund Return On Investment

2007-08 379.17 981.92 38.62
2008-09 414.32 1330.10 31.15
2009-10 202.98 1540.24 13.18
2010-11 -281.76 1300.25 -21.67
2011-12 -381.08 915.01 -41.65
Interpretation:-
The above table reveals how well the resources of the firm are being used.
Higher the ratio, better the result. The above ratio implies how well the firm is growing in
terms of profitability and efficiency. From the above table we can concern that the return
on investment is in decreasing trend. ROI is highest in the year 2007-2008 as 38.62 %.
But there after it’s decreased every year.
The ROI is negative in the years 2010-2011 & 2011-2012 as -21.67 & -41.65 respectively.
Which is not a good sign for the firm?

72

Return on Capital Employed Ratio:-
Return On Capital Employed

Year PBIT Capital Employed Ratio
2007-08 602.61 981.92 61.37
2008-09 565.57 1330.10 42.52
2009-10 550.35 1540.24 35.73
2010-11 16.05 1300.25 1.23
2011-12 -300.14 915.01 -32.80
Interpretation:-
The above table depicts return on Equity Capital Employed Ratio of Kesoram has
decreased every year from 2007-2008 to 2010-2011.It further decreased to negative in the
year 2011-12 to -32.80.which shows constant decrease in the returns of the company.

CHAPTER V
FINDINGS & SUGGESTIONS:

75

Findings:
The Share capital remains constant. Share capital is unchanged all the years from
2008-2012.
Reserves & surplus were recorded an increasing trend in the period between 2008
and 2010.It is showing decreasing trend in the period 2011-2012 (i.e. from 160.19
% in 2010 to 93.09 % in 2012).
Current Liabilities were increased compared to base year i.e. 2008.
Provisions increased to 2625.97 % i.e., in Rupees 392.32 crores in the current year.
The current ratio for all the five year is lower (less) than the standard rule i.e., 2:1.
And it is 0.97 in the year 2011-2012 (current year).
The Debt-Equity Ratio was shown under the standard ratio. It is clear that the long
term debt is more than that of the share holders’ fund. It indicates that the firm
heavily relying on external funds rather than the internal funds.
The operating and net profit of Kesoram is in decreasing trend due to heavy
increase of manufacturing & administrative expenses.
ROI is highest in the year 2007-2008 as 38.62 %. The ROI is negative in the years
2010-2011 & 2011-2012 as -21.67 & -41.65 respectively.
Return on Equity Capital Employed Ratio of Kesoram has decreased every year
from 2007-2008 to 2010-2011.It further decreased to negative in the year 2011-12
to -32.80.
EPS of Kesoram has decreased every year from 2008-12.It is negative in the year
2011 & 12.

76

Suggestion:
The organization should adopt an appropriate capital structure.
The company’s debt-equity ratio is recorded more or less as 1.11 in the year 2008
and it is increased to 4.49 in the year 2012 (current year).The company should
adopt a better debt equity mix in the future to control the fluctuations in returns.
The company should control fluctuations in cash and bank balances as it impacts
the current ratio of the company.
The provisions are showing increasing trend which indicates risk of debtors. The
firm should implement an effective credit management policy. It should utilize its
idle funds by decreasing provisions.
The company should control heavy increase of manufacturing & administration

expenses as it is impacting the operating and net profit of company.

77

ANNEXURE
Profit And Loss Account of Kesoram Cement:
Mar'12 Mar'11 Mar'10 Mar'09 Mar'08

12 Months 12 Months 12 Months 12 Months 12 Months
INCOME:
Sales Turnover 6282.60 5750.72 5051.51 4316.13 3457.00
Excise Duty 364.40 352.84 300.89 418.15 454.29
NET SALES 5918.20 5397.88 4750.62 3897.97 3002.71
Other Income 0.00 0.00 0.00 0.00 0.00
TOTAL
5961.29 5487.33 4810.19 3939.69 3020.20
INCOME
EXPENDITURE:
Manufacturing
819.03 748.03 139.74 131.53 441.13
Expenses
Material
3708.97 3101.50 2955.50 2293.59 1184.48
Consumed
Personal
334.68 273.55 232.94 186.90 153.44
Expenses
Selling Expenses 819.10 782.53 586.67 488.46 450.19
Administrative
282.25 293.08 172.19 161.79 99.07
Expenses
Expenses
0.00 0.00 0.00 0.00 0.00
Capitalized
Provisions Made 0.00 0.00 0.00 0.00 0.00
TOTAL
5964.03 5198.70 4087.04 3262.27 2328.32
EXPENDITURE
Operating Profit -45.83 199.18 663.58 635.70 674.39
EBITDA -2.74 288.64 723.16 677.42 691.88
Depreciation 297.40 272.59 172.80 111.86 89.27
Other Write-offs 0.00 0.00 0.00 0.00 0.00
EBIT -300.14 16.05 550.35 565.57 602.61
Interest 410.15 239.83 109.21 120.87 54.26
EBT -710.29 -223.77 441.14 444.70 548.35
Taxes -329.21 57.98 238.16 30.37 169.18
Profit and Loss
-381.08 -281.76 202.98 414.32 379.17
for the Year
Non Recurring
-11.42 70.63 32.28 -40.23 4.02
Items
Other Non Cash
12.76 0.91 2.07 4.65 0.17
Adjustments
Other
0.00 0.00 0.00 0.00 0.00
Adjustments
REPORTED
-379.74 -210.21 237.34 378.74 383.35
PAT

78

Balance Sheet Of Kesoram:
Years
Particulars 2008 2009 2010 2011 2012
Liabilities
Share Capital 45.74 45.74 45.74 45.74 45.74
Reserves & Surplus 930.85 1280.24 1491.11 1251.62 866.57
Revaluation Reserves 5.33 4.12 3.39 2.89 2.7
Loans
Secured Loans 971.06 1536.27 1863.72 2371.83 3177.92
Un Secured Loans 121.29 434.16 1262.5 1627.44 927.42
Deferred Tax Liabilities 0 0 0 0 0
Current Liabilities
Provisions 330.39 345.29 357.34 14.94 407.26
Current Liabilities 570.67 665.87 1076.88 1139.02 1800.1
Total 2975.33 4311.69 6100.68 6453.48 7227.71

Assets
Net Block 1084.24 1804.35 3431.82 3691.72 3587.21
Capital WIP 634.59 864.85 412.83 437.81 680.65
Investments 47.83 61.78 51.43 65.82 66.36
Current Assets
Inventories 442.17 589.06 916.19 1118.55 995.16
Sundry Debtors 273.07 380.17 542.89 631.34 673.58
Cash & Bank Balances 40.36 56.57 80.14 71.88 69.59
Total Current Assets 755.6 1025.8 1539.22 1821.77 1738.33
Loans & Advances 452.89 554.62 665.06 434.6 1154.09
Fixed Deposits 0.18 0.28 0.31 1.76 1.07
Total 2975.33 4311.69 6100.68 6453.48 7227.71

79

KEY ITEMS 2012 2011 2010 2009 2008
Preference
Dividend 0 0 0 0 0
Equity Dividend 4.57 25.16 25.16 25.16 25.16
Equity Dividend
(%) 9.99 55 55 55 55
Shares in Issue
(Lakhs) 457.43 457.43 457.43 457.43 457.43
EPS - Annualised
(Rs) -83.02 -45.95 51.88 82.8 83.8

80

BIBLIOGRAPHY
Sl. Books: Author Name

No.
1. Financial Management Khan & JAIN
2. Financial Management I.M.Pandey
3. Management Accounting R.P.Trivedi
Websites & Search Engines

1. www.kesoram.com.
2. www.moneycontrol.com.
3. www.googlefinance.com.
Annual reports of Kesoram cement limited 2008-2012.

81

Study of Financial Performance-Shiva Sai

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Study of Financial Performance-Shiva Sai

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A FINAL PROJECT REPORT ON

SHIVA SAI KRISHANA

Under the Guidance of

AVINASH DEGREE COLLEGE

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I hereby declare that the project entitled “A study on financial performance

SHIVA SAI KRISHNA

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I am very much thankful to our Prof. SOMNATH CHATTOPADHYAY

I convey my thanks to my beloved parents and my faculty who helped me directly

SHIVA SAI KRISHNA

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S.No: Contents Page No.

Objectives of the Study

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“Financial performance analysis is a process of evaluating the relationship

The purpose of financial analysis is to diagnose the information contained in

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“The analysis of financial statements is a process of evaluating the relationship between

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Need Of Financial Management Study To Diagnose The Information Contain In

Financial Statement. So as To Judge the Profitability and Financial Position of the

Financial Analyst Analyses The Financial Statements With Various Tools Of

Essential to Bring Out the History.

Significance and Meaning of the Financial Statements.

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1. To understand the financial statements of Kesoram cement.

2. To study the change in assets and liabilities of the company.

3. To study the liquidity position of the firm.

4. To study the financial health of the company using ratio analysis.

5. To study the profitability of the company.

6. To offer suggestions to the company.

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Interest of various related groups is affected by the financial performance of a firm.

This is a systematic way to solve the research problem and it is important

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Data we collected based on two sources.

1. It includes data gathered from the annual reports of Kesoram.

Types Of Financial Statements Adopted:

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1. Only Interim Reports:

2. Don’t Give Extra Position:

The Financial Statements Are Expressed In Monetary Values, So They Appear To

The Financial Statements Are Prepared On The Basis Of Historical Costs Or

4. Act of non monitory factors Ignored:

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In the most general sense of the word, cement is a binder, a substance

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