Project Report onRATIO ANALYSIS -

At Northern Coalfields Limited Singrauli

Presented byShashank Pandey

Introduction of topicTo analyze the financial position of NORTHERN COALFIELDS LIMITED, different tools are used , of Ratio Analysis.

Financial analysis involves the use of various financial statements. These statements do several things.
First the balance sheet and the second is income statement.

IMPORTANCE
Ratio analysis is an important technique of financial analysis. It is a means for judging the financial health of a business enterprise. It determines and interprets the liquidity, solvency, profitability, etc. of a business enterprise

Objective of study Analysis of financial statements is an attempt to assess the efficiency and performance of an enterprise. For that there are some objectives which are described as under. 1. Earning capacity or profitability 2. Comparative position in relation to other firm. 3. Efficiency of management 4. Financial strength

Company profile NCL is a subsidiary of Coal India Limited (CIL). It was founded in the year (1984). Earlier it was a subsidiary of Central Coalfields Limited (CCL). It is among the top PSU's in India. NCL is the only subsidiary of CIL producing 100% of coal from opencast mines. There is steep rise in the coal demand on NCL to meet the power and energy needs of the country . (44.43MT in 2002-03 to 78.44MT in 2011-12). The major demand of coal on NCL is from power sector, which contributes more than 96% of the total demand.

The CILs production level in the year 2011-12 is projected as 619.67 million tones out of which NCLs contribution will be 78 million tonnes.
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Research MethodologyThe research is done through : Journals : I have used the the organizational journals published by the company for collecting the data. Annual Reports : Annual reports are the best way to collect the information about the company. If we are going to conduct any research work in the field of Finance then we must should have to refer the companys Annual Report. Plant visit : By visiting the Plant I came to know that what is the real scenario, what is the position of the company? How the work flows ? etc. then I collected the relevant information which I was needed to complete my project.

Personal discussion and interaction : I have Discussed with the concerned people and thus collected information for the research.

RATIO ANALYSISAccording to MyersRatio analysis is a study of relationship among the various financial factors in a business.

TYPES OF RATIOS1. Liquidity ratios

2. Turnover Ratios3. Leverage Ratios

4. Profitability Ratios

vision &MissionVISION Be the leading energy supplier in the country, through best practices from mine to market. MISSION The mission of Coal India Limited is to produce and market the planned quantity of coal and coal products efficiently and economically with due regard to safety, conservation, quality and environment.

FindingI came across following suggestions and findings during undergoing the project work on topic FINANCIAL ANALYSIS OF NORTHERN COALFIELDS LIMITED.

1.In NCL the coordination among the various sections of the Finance & Accounts department is very nice, as the Finance & Accounts department is a big department consisting of near about 32 sections. It is the work force of the Finance & Accounts department, which makes it possible.
2.In the NCL there not to create debtors they generally deal with first to receive the cash or cheque, and then they supply the finished material. 3. In the NCL there working capital management is very good, they use the IBS (ERP system) to manage the over all activity.

ConclusionAfter analyzing the different Ratios of the Northern Coalfields Limited I found that the Company is really in Good financial condition because the management has taken a great effort in managing the funds like acquiring and allocation of the funds, optimum utilization of the available resources. The analysis shows that the profitability of the company is increases as compared to the last years due to high production and sells with lesser expenses

The ratios analysis is one of the most powerful tools of financial management. Though ratios are simple to calculate and easy to understand, they suffer from serious limitations 1. Limitations of financial statements 2. Comparative study required 3. Problems of price level changes 4. Lack of adequate standard 5. Limited use of single ratios

LIMITATION-