SUMMER INTERNSHIP PROJECT REPORT ( 15th may to 30th june )
On Training Undertaken at
HINDUSTAN ZINC LTD. Project Title: “COMPARATIVE ANALYSIS OF PERFORMANCE OF HZL BEFORE AND AFTER PRIVATISATION” Submitted in partial fulfillment fulfillment for the award of degree of Master of Business Administration Administration
FMS- The IIS University
Submitted by:Student’s Name Roll No.
Submitted to:Faculty Name Designation
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INDEX
1 2 3 4 5 6 7 8 9 10 11 12
Acknowledgement Executive Summary A Glance at the Vedanta Group Locat ocatio ion n of Vedan edanta ta Mine Mine on the the Word Word Map Map Vedanta Resources HZL at a Glance Intr Introd oduc ucti tion on of Hind Hindus usta tan n Zinc Zinc Limit imited ed HZL Milestones at a Glance Intr Introd oduc ucti tion on of Ram Rampura pura Aguch guchaa Mine Mine Ranki nking of HZL Com ompa pan ny and R A Mine Management Rampura ura Aguch ucha Mine Locati ation Anal nalysis sis and and Int Interpr rpretati ation Parameters Intro Introduc ducti tion on of Mo Moder dern n Tech Techniq niques ues of Anal Analysi ysiss of Fina Financi ncial al Review of Literature Types of Analysis BSE Stock Price Data Balan alance ce Sheet heet as at Marc March h 31, 31, 2007 2007 Profit and Loss Account Five ive Year Year Finan inanci cial al High Highli ligh ghts ts Research Methodology Ques Questi tion onna nair iree for for staf stafff membe ember r Conclusion Bibliography •
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• •
14 15 16 17 18 19 20 21
2
INDEX
1 2 3 4 5 6 7 8 9 10 11 12
Acknowledgement Executive Summary A Glance at the Vedanta Group Locat ocatio ion n of Vedan edanta ta Mine Mine on the the Word Word Map Map Vedanta Resources HZL at a Glance Intr Introd oduc ucti tion on of Hind Hindus usta tan n Zinc Zinc Limit imited ed HZL Milestones at a Glance Intr Introd oduc ucti tion on of Ram Rampura pura Aguch guchaa Mine Mine Ranki nking of HZL Com ompa pan ny and R A Mine Management Rampura ura Aguch ucha Mine Locati ation Anal nalysis sis and and Int Interpr rpretati ation Parameters Intro Introduc ducti tion on of Mo Moder dern n Tech Techniq niques ues of Anal Analysi ysiss of Fina Financi ncial al Review of Literature Types of Analysis BSE Stock Price Data Balan alance ce Sheet heet as at Marc March h 31, 31, 2007 2007 Profit and Loss Account Five ive Year Year Finan inanci cial al High Highli ligh ghts ts Research Methodology Ques Questi tion onna nair iree for for staf stafff membe ember r Conclusion Bibliography •
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• •
14 15 16 17 18 19 20 21
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EXECUTIVE SUMMARY
The Summer Training being undertaking for the purpose of
“COMPARITIVE
ANALYSIS ANALYSI S OF PERFORMANCE OF HZL BEFORE AND AFTER PRIVATISATION ”
Where I come to realize various financial aspects such as performance reviews, financial growth and impact, impact, annual report report and matter matter relate related d to corporat corporatee governan governance. ce. The study study involved involved analysis of the financial impact of the company internally as well as externally. I also intend to find out about how the leading brand image of “Hindustan Zinc Limited” In MINE sector has been performed by deeply undertaken their rations as schedule affixed as annexure to the end of the summer training report.
Trainee Name: Title of the Project:
BARKHA CHOUDHARY “COMPARITIVE ANALYSIS OF PERFORMANCE OF HZL BEFORE AND AFTER PRIVATISATION ”
Project Done Under: Under:
Mr. KARTIKEYA SHARMA (Executive Finance)
Project Duration: Duration:
45 Days
College:
International International school of informatics & management management
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ACKNOWLEDGEMENT
I express my sincere thanks to my project guide, Mr. KARTIKEYA SHARMA (Executive Finance) for guiding me right from the inception till the successful completion of the project. I
sincerely acknowledge him for extending his valuable guidance, support for literature, critical reviews of project and the report and above all the moral he had provided to me with all stages of this project. Pay my sincere thanks and gratitude to management of Hindustan Zinc Limited (H.Z.L) - Rampura Agucha Mine, Mr. S. M. SHARMA ( Head- Finance) who allowed to complete my summer training in HZL.
BARKHA CHOUDHARY
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A GLANCE AT THE VEDENTA GROUP
Vedanta is a FTSE 100 metals & mining company. Its principal operations are located throughout INDIA, with additional operation in Zambia, Australia, and Armani etc.
The major metals produced are Aluminum, Zinc, Lead, and Gold & Copper.
It is the 1st Indian company listed on the LONDON STOCK EXCHANGE in December 2003 at a market capitalization of ~$1.9 billion.
It is one of the largest non-ferrous industries in the world. It owns about 28 industries all over the world.
VISION: The vision is to become million-ton producer at the lowest deciles costs in each of its metals, thereby consolidating India’s position on the global metals & mining map.
MISSION: The mission is to create a world-class metals & mining group & generate strong financial returns.
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VEDANTA RESOURCES Pvt. LIMITED
KONKOLA COPPER MINES PLC 51%
STERLITE INDUSTRIES (INDIA) LTD. 80%
Vedanta Alumina Ltd. 94%
Hindustan Zinc Ltd. 67%
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MADRAS ALUMINIUM COMPANY LTD. 80%
Bharat Aluminum Company Ltd. 49%
INTRODUCTION OF HINDUSTAN ZINC LIMITED
Hindustan Zinc Ltd (HZL) is India's leading zinc producer. As a part of Vedanta Resources, a London listed metals and mining major with Aluminum, Copper and Zinc operations in UK, India and Australia, HZL takes advantage of its mineral resources and related core competencies and believes it has growth opportunities for increasing products and improving returns
The Zinc business of Vedanta is managed within Hindustan Zinc Limited. HZL is India’s only integrated Zinc Company, operating from mine to finished metal and supplied around 73% of India’s zinc requirements in 2005-06. At the base of the company is the Rampura Agucha mine with its low cost and consistently high grade ore.
In 2005-06, HZL produced 283,698 tonnes of zinc as a result of recent expansions of the Rampura Agucha mine and at the nearby Chanderiya facility. The ore produced at the mines contains lead, which is smelted alongside the zinc. In 2005-06 HZL produced around 23,636 tonnes of lead. The commissioning of a new Ausmelt TM smelter at Chanderiya in February 2006 has increased capacity to 85,000 tpa of lead.
Zinc is used mainly in galvanizing steel to improve its durability. HZL plays a role in developing the market for the end product. We believe the capacity for galvanized steel in India is increasing significantly, due to the demand for the product in infrastructure and construction work. Rampura Agucha Mine is one of the units of Hindustan Zinc Limited, a Sterlite group company. It is an open pit mine having 40.2 Million tons reserve. It ranks 5th globally in terms of grade. It is in operation since 1991, presently having a capacity of 3.8 million tones of ore treatment per year and additional 1.2 million ton is going to be added in the year 2007-08.Its method of mining is mechanized open cast excavators and dumpers. The extracted ore consists of 2.01% lead & 13.53% zinc.
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HZL Milestones & Projects at a glance FY2012
FY2010
FY2009
FY2009
FY2009 FY2009 FY2008 FY2008 FY2008 FY2008 FY2007 FY2007 FY2006 FY2006 FY2006 FY2005 FY2004 FY2004 FY2003 FY2003 FY2003
Rampura Agucha Mine expansion from 5.00 million tonnes per annum to 6.00 million tonnes per annum, increasing the total ore production capacity of the Company to 8.60 million tonnes per annum. Commissioned the 210,000 tonnes per annum Hydrometallurgical Zinc Smelter at Dariba Smelting Complex, increasing the Zinc & Lead metal production capacity to 964,000 tonnes per annum (879,000 tonnes of Zinc and 85,000 tonnes of Lead) Rampura Agucha Mine expansion from 3.75 million tonnes per annum to 5.00 million tonnes per annum, increasing the total mining capacity of the Company to 7.40 million tonnes per annum 88,000 tonnes per annum zinc debottlenecking completed at Chanderiya Smelting Complex & Debari Zinc Smelter making the total metal production capacity to 754,000 tonnes per annum Commissioned 80 MW Captive Power Plant at Zawar Mines Commissioned 34.4 MW Wind Energy Farms making the Company's total Wind Energy capacity to 123.2 MW. Commissioned 170,000 tonnes per annum of Hydrometallurgical Zinc Smelter (Hydro II) in a benchmark time of 20 months at Chanderiya Smelting Complex Commissioned 80 MW Captive Power Plant at Chanderiya Smelting Complex 5,000 tonnes of zinc debottlenecking completed at Debari Zinc Smelter Commissioned 50.4 MW of Wind Energy Farms at Gujarat Sindesar Khurd Mine began production with an initial production capacity of 0.3 million tonnes per annum Commissioned 38.4 MW of Wind Energy Farms at Gujarat Commissioned 170,000 tonnes per annum of Hydrometallurgical Zinc Smelter (Hydro I) at Chanderiya Smelting Complex Commissioned 2 X 77 MW Captive Power Plant at Chanderiya Smelting Complex Commissioned 50,000 tonnes per annum of Ausmelt Lead Smelter at Chanderiya Smelting Complex Rampura Agucha Mine expansion from 2.30 million tonnes per annum to 3.75 million tonnes per annum Sterlite acquires additional shares of 18.92% from Government of India under call option. 35,000 tonnes of zinc debottlenecking completed at Chanderiya Smelting Complex 32,000 tonnes of zinc debottlenecking completed at Debari Zinc Smelter and Vizag Zinc Smelter Debottlenecking of Rampura Agucha Mine from 1.37 million tonnes per annum to 2.30 million tonnes per annum Sterlite acquires 26% and management control in HZL from the Government of India in privatization. A further 20% is bought from market through open offer.
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FY1991 FY1991 1983 1977 1971 1968 1942
Commissioned 70,000 tonnes per annum of zinc and 35,000 tonnes per annum of lead Pyro metallurgical Lead-Zinc Smelter at Chanderiya Rampura Agucha Mine began production with an initial production capacity of 0.9 million tonnes per annum Rajpura Dariba Mine starts production. Vizag zinc smelter and second set of Zawar mine facilities commissioned. First expansion of Zawar mine commissioned. Debari smelter commissioned. Commencement of mining at Zawar.
In Rajasthan there are three Mines and four Smelters of HZL 1) Rampura Agucha Mine (World’s 3rd Largest Mine) 2) Rajpura Dariba Mine 3) Zawar Mine (The oldest mine) The three smelters are:
1) Zinc Smelter Debari: It is the oldest smelter of HZL & situated 20 km from Udaipur. 2) Chandaria Lead Zinc Smelter (Rajasthan) 3) VZS Zinc Smelter (Andrapradesh) 4) Dariba Super Smelter (Rajasthan)
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INTRODUCTION OF RAMPURA AGUCHA MINE
Rampura Agucha Mine, located 225 km north-northeast of Udaipur, Rajasthan, is the largest & richest Lead Zinc deposit in the country containing 63.6 million tonnes ore with in-situ grade of 13.54% zinc & 1.97% lead. 49.903 million Tonnes of ore are amenable for mining by open pit method, up to the depth of 250 Mts. The open cast mine has capacity of 4500 tpd ore and matching state-of-the-art beneficiation plant and other infrastructure facilities. It is proposed to enhance the capacity to 11400 TPD ore production and treatment in year 2005.
Rampura Agucha is no exception to the Indian heritage in the lead zinc mining & smelting with its extensive, well planned mine workings, remains of smelting (silver) residuals, slag & artifacts spread in & around the area. The radio-carbon dating of these ancient mine wooden-log supports & arte facts have dated the activities to be 2900 years old, during the Maurya period. The mine has acquired ISO 9001, quality assurance certification, ISO 14001, OHSAS 18001, Environment, Health & Safety Management System certification for open cast mining & beneficiation of ore for production of concentrates.
RAMPURA AGUCHA MINE Commissioned Location Capacity Details
1991 225 km north of Udaipur, Rajasthan, India 3.7 Mtpa ore An open cast mine and good mineralogy leading to higher recovery and overall low cost of production. Onsite concentrator to produce zinc concentrate.
Certifications
ISO 9001:2000, ISO 14001:1996, OHSAS 18001:1996
Vision •
Be a world-class zinc company, creating value, leveraging mineral resources and related core competencies .
Mission •
•
Be a lowest cost Zinc producer on a global scale, maintaining market leadership Be innovative, customer oriented and eco-friendly, maximizing stakeholder value
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RANKING OF HZL COMPANY AND RAMPURA AGUCHA MINE IN THE WORLD
1 2 3 4 5 6 7 8 9 10
By Mine Red Dog Century Rampura-Agucha Antamina Brunswick Mount Isa Pb/Zn Tara Zyryanovsk Iscaycruz Lisheen
11 Skorpion 12 McArthur River 13 Vazante (CMM) Golden Grove 14 (Scuddles) 15 Lamping
kt Zn (%) 563 4.8 510 4.4 420 3.6 350 3.0 283 2.4 265 2.3 218 1.9 190 1.6 175 1.5 175 1.5
1 2 3 4 5 6 7 8 9 10
By Company Xstrata AG Teck Cominco Limited Glencore Zinifex Hindustan Zinc Anglo American plc New Boliden Minera Volcan Votorantim Industrias Penoles Lundin Mining Corporation BHP Billiton Breakwater Resources
171 155 147
1.5 1.3 1.3
11 12 13
144 135
1.2 1.2
14 Kazakhmys 15 Oxiana Resources NL
Corporate Information Board of Directors Shri Agnivesh Agarwal – Chairman Smt Ajita Bajpai Pande – Director Shri SK Mittal – Director Shri Bhupal Nanda – Director Shri Navin Agarwal – Director Shri MS Mehta – Whole-time Director Shri AR Narayanaswamy – Director Shri Akhilesh Joshi – COO & Whole-time Director Chief Financial Officer Shri SL Bajaj Company Secretary Shri Rajendra Pandwal Statutory Auditors M/s. Deloitte Haskins & Sells
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kt Zn (%) 962 8.2 697 6.0 654 5.6 595 5.1 513 4.4 381 3.3 331 2.8 288 2.5 224 1.9 205 1.8
195 193 165
1.7 1.7 1.4
159 144
1.4 1.2
VEDANTA STRATEGIES
Our goal is to generate strong financial returns and create a world-class metals and mining group. Our Strategy, to set out at listing, is
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Recognition during the years Quality 2009 IMC Ramakrishna Bajaj National Quality Award - ‘Performance Excellence Trophy’ (RBNQA- 2009) - Chanderiya Smelting Complex. 2008 2008 2008
2007 2006 2006 CSR 2009 2009 2008 2008 2008 2007 2007 2007 2007 2007 2006 2005
HSE 2009 2009 2009 2009 2009 2009
IMC Ramkrishna Bajaj National Quality Certificate of Merit (RBNQA-2008) Chanderiya Smelter Complex Golden Peacock National Quality Award (GPNQA-2008) - Chanderiya Smelter Complex 9th Annual Excellence Award in the Best manufacturing process improvement by International Quality and Productivity Centre, London - Chanderiya Smelter Complex Five-S Workplace Management System - Certificate by Quality Circle Forum of India (Valid till 31 July 2010) - Rampura Agucha Mine Best4 Integrated Management System Certification - Debari Zinc Smelter Best4 Integrated Management System Certification - Vizag Zinc Smelter
State Population Stabilization Certificate to Chanderiya by Govt. of Rajasthan State Bhamashah Award 2009 to Rampura Agucha by Govt. of Rajasthan Gold Pegasus Corporate Social Responsibility Award FICCI Annual Awards 2007-08 in the category of "Rural & Community Development" Asian Corporate Social Responsibility Award Golden Peacock Award for Corporate Social Responsibility TERI Corporate Social Responsibility Award Silver Pegasus Corporate Social Responsibility Award 2007 constituted by Reader's Digest and the India Today Group. FIMI Social Awareness Award State Population Stabilisation Award - Chanderiya Smelter Complex FICCI-SEDF Corporate Social Responsibility Award Overall Best Performance Shield and 10 Prozes in Community Development Zawar Mines
CII-ITC Sustainability Award (Commendation for Strong Commitment towards sustainability) - Hindustan Zinc Ltd. Golden Peacock Occupational Health & Safety Award- Debari Zinc Smelter. CII- National Award for Excellence in water Management- Rampura Agucha Mine. CII-Leadership & Excellence Award in Environment, Health & Safety- Vizag Zinc Smelter. Stars of the Industries Awards in Green Manufacturers category- Debari Zinc Smelter. Safety Innovation award by Institution of Engineering - Debari Zinc Smelter.
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2009 2009 2009
2008 2008 2008 2008 2008 2008
2007 2007 2007 2007 2007
2007 2007 2007
International Safety Award 2008 from the British Safety Council - Debari Zinc Smelter. RoSPA gold award 2009 from Royal Society for Prevention of Accidents, UK -Debari Zinc Smelter Golden Peacock Environment Management Award 2009 from World Environment Foundation (WEF), in association with Institute of Directors Rampura Agucha Mine RoSPA gold award 2008 from Royal Society for Prevention of Accidents, UK -Debari Zinc Smelter FIMI's Environment, Social Awareness and Excellence Award from Federation of Indian Mineral Industries - Rampura Agucha Mine National Energy Conservation Award 2008 from the Govt. of India - Rajpura Dariba Mine CII- National Water Management Excellent Award-2008 - Chanderiya Smelter CII National Energy Management Award - Vizag Zinc Smelter Excellence in Environmental Management and Excellence in Workers Welfare awards from the Federation of Andhra Pradesh Chamber of Commerce & Industry - Vizag Zinc Smelter 4 Star Rating BSC Safety Mg System by British Safety Council, UK – RAM RoSPA gold award 2007 from the Royal Society for the Prevention of Accidents, UK - Debari Zinc Smelter Best Asian power plant and Best Emissions Reduction Project in Asia Award for the year 2007- CLZS CPP Golden Peacock Occupational Health & Safety Award - Chanderiya Smelter Complex Two Awards from the Confederation of Indian Industry (CII), Hyderabad (i) Water Efficient Unit Award (ii) Innovative Case Study Award - Chanderiya Smelter Complex Safety Innovation Award 2007 instituted from the Institution of Engineers (India) - Chanderiya Smelter Complex & Debari Zinc Smelter Leadership and Excellence Award in Environment, Health and Safety (EHS) from Confederation of Indian Industry - Vizag Zinc Smelter. Greentech Environment Excellence Award 2007 in metal & mining sector Vizag Zinc Smelter (Silver), Chanderiya Smelter Complex (Gold), Debari Zinc Smelter (Silver)& Rampura Agucha Mine (Gold)
18th Mine Environment & Mineral Conservation Week under the aegis of Indian Bureau of Mines, Ajmer Region: Got First Position in: (i) Overall Performance (ii) Waste Dump Management (iii) Water Pollution Control (iv) Documentation on Mineral Conservation - Rampura Agucha Mine 2006 National energy conservation award from Ministry of Power, GoI -Rajpura Dariba Mines 2006 Gem Granite Environment Award in the mechanized category of mines. Rampura Agucha Mine 2006 Greentech Safety Platinum Award - Vizag Zinc Smelter 2007
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2006 2006 2006 2006 2006 2006 2006 2006 2006 2006 2005 2005 2005 2005 2005 2005 2004 2004 2004 2004 2004 2004
Greentech Safety Gold Award in Metal Sector - Chanderiya Lead Zinc Smelter Greentech Environment Excellence Gold Award in Metal Sector - Chanderiya Lead Zinc Smelter Greentech Environment Excellence Gold Award in Metal Sector - Chanderiya Lead Zinc Smelter Greentech Environment Excellence Gold Award in Metal Sector - Zawar Mines Greentech Environment Excellence Gold Award in Metal Sector - Vizag Zinc Smelter Golden Peacock Environment Management Award - Vizag Zinc Smelter Greentech Safety Appreciation Certificate in Metal Sector - Zawar Mines Overall Best Team in First Aid and Best Team Member Award - Rajpura Dariba Mines Greentech Safety Silver Award in Metal Sector - Rampura Agucha Mine Greentech Environment Excellence Silver Award in Metal Sector - Rampura Agucha Mine National Energy Conservation Award 2005 in Mining Sector - Rampura Agucha Mine Greentech Gold Award for Environmental Excellence in the metal sector from Greentech Foundation for 2005-06 - Vizag Smelter Greentech Bronze award for safety performance during the year 2005-06 Chanderiya Lead and Zinc Smelter Greentech Environment Excellence Silver Award in Metal Sector - Vizag Zinc Smelter Greentech Silver Award for Environmental Excellence in the metal sector from Greentech Foundation for 2005-06 - Rampura Agucha Mine Best Safety practices Award from Director General of Mines Safety during the year 2005-06 - Rampura Agucha Mine. British Safety Council's National Award - Chanderiya Lead Zinc Smelter National Safety Council Award - Chanderiya Lead Zinc Smelter OHSAS-18001 Certification - Vizag Zinc Smelter Greentech Safety Silver Award in Metal Sector - Chanderiya Lead Zinc Smelter Greentech Environment Excellence Silver Award in Metal Sector - Zawar Mines First Prize in afforestation/ waste dump management - Rajpura Dariba Mines
HR 2009
Amongst the top 25 Companies declared as Hewitt Best Employers in Asia in 2009 2009 Ranked # 2 in the top 25 Companies declared as Hewitt Best Employers in India in 2009 2006 Golden Peacock National Training Award Others 2008 Rampura Agucha Mine - Certified for SA-8000: 2001 2008 Zawar Mines - Certified for SA-8000: 2001 2008 Dun & Bradstreet Rolta - Corporate Award 2008 under Non-Ferrous Metals Sector.
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Dun & Bradstreet American Express Corporate Award 2007 in Non-Ferrous Sector. 2007 Asian Power Award 2007 in the category: (a) Asian Power Plant of the Year -2007 (b) Best Emissions Reduction Project in Asia. Hosted by Asian Power, Charlton Media Group, Singapore - Chanderiya Captive Power Plant 2007 Golden Peacock Award for Excellence in Corporate Governance-2007 by the Institute of Directors 2007 Bhamashah Award by Department of Education, Govt. of Rajasthan for outstanding contribution in the development of educational facilities in surrounding areas - Chanderiya Smelter Complex & Debari Zinc Smelter 2007
2006
Federation of Andhra Pradesh Chambers of Commerce & Industry (FAPCCI) The Amancherla Ramamurthy Silver Rolling Trophy - for Excellence in All Round Performance in industrial activity
Golden Peacock National Training Award SA 8000 Certification - Debari Zinc Smelter SA 8000 Certification - Vizag Zinc Smelter Best Non-Ferrous Metals Company Award Best Management Award - Vizag Zinc Smelter Placed Overall First in Underground Mine in the Udaipur region - Zawar Mines Best Team Award on Recovery - Rajpura Dariba Mines Placed Overall Second in Underground Mine in the Udaipur region - Rajpura Dariba Mines 2005 Excellence Award in the Open Cast Mechanised Mines Category - Rampura Agucha Mine 2005 Overall First in Mechanised Open Cast Mines category in the Ajmer region Rampura Agucha Mine 2005 Recognition as a R&D Unit 2006 2006 2006 2005 2005 2005 2005 2005
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MINING
The deposit is being mined with opencast method with heavy earth moving machines like 100 & 85-ton capacity dumpers, 9 & 15 cubic meter bucket capacity shovels, 165 mm diameter drill machines, dozer, grader, water sprinkler, rock breaker & various other service equipments.
Advanced computer technology including Data Mine is being used for mine planning and designing, day to day grade control, production & equipment scheduling. Overall stripping ratio for the mine is 1:4.14. The individual bench slope is worked for 70 degree with the bench height of 10 Mts. Ultimate pit is worked with two ramps, one each in H/W & F/W of width 25 Mts. & gradient 1 in 16. It will be changed to 1 in 12, subject to approval of DGMS. The waste generated is dumped at pre-decided sites.
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ORE BENEFICIATION: Beneficiation plant comprises of crushing, grinding & classification, differential floatation, concentrate dewatering & tailing disposal.
PLANT OVERVIEW: A plant overview HMI screen is provided to give rapid access to any plant section from a single screen; it is readily available from anywhere in the system.
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Crushing
PRIMARY CRUSHING PLANT:
After the mining stage is over ore is brought to the ore beneficiation plant where it is first processed in the primary crushing plant comprised of Gyrator crusher, big blocks of ore material is crushed to a particle size of (-200mm) and from there the crushed ore is stored at the coarse ore stockpile (old & new) which has the capacity of 4500 tones each.
FIG:-UNLOADING OF ORE AT PRIMARY CRUSHER
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PROCESS FLOW The ore processed in the Gyrator of primary Crusher (U-3) house is then forwarded to apron feeder (U-5) with the help of crushed ore hopper (U-4), apron feeder passes crushed ore to coarse ore storage (U-16) though product conveyor (U-9), BH conveyor (U-11) and tripper belt conveyor (U-13).
Flow sheet of Future Primary Crusher House
Primary Crusher Apron Feeder
v e yo r U- 9 Con
New Primary Crusher
U-11 conveyor
Flap Gate System for Diversion to COSP for Stream 2
C-1 conveyor
New Apron Feeder
New Transfer Conv CV01
U-13 Tripper Conv
New Transfer Conv CV12
C-2 Tripper Conv Flap Gate System for Diversion to COSP for Stream 2
New Coarse Ore Stockpile No 3 2 C V 0 o n v e r C a n s f r T N e w
New Tripper Conv CV 04
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SECONDARY/TERTIARY CRUSHING HOUSE PROCESS FLOW: Crushed ore of size (-150mm)from primary crusher coarse ore storage (U16) is feeded into 5nos. reciprocating feeder (U33A-U33E),through crushed feed conveyor (U35) the material is brought to D.D.VIBRATING SCREEN.
The underflow of the D.D.V SCREEN is passed to FINE ORE CONVEYOR (U-71) and overflow material from first screen of D.D.V SCREEN is passed to SECONDARY CONE CRUSHER (U-54) and from there it is transferred to CRUSHER PRODUCT CONVEYOR (U56)while the overflow form the second screen of D.D.V. SCREEN is passed to CRUSHER PRODUCT CONVEYOR
(U-56).
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The material from U-56 is stored in TERTIARY CRUSHER BIN U-62 A, B, C through a flap gate gate mech mechan anis ism m & TERT TERTIA IARY RY BIN BIN CONV CONVEY EYOR OR (U-5 (U-58) 8) & CRUS CRUSHE HER R BIN BIN FEED FEED CONVEYOR (U-60), and through belt feeders the material is transferred to 3nos.. VIBRATING SCREEN and U/F is transferred to TERTIARY CRUSHERS (U-69 A, B, C) while the O/F goes to FINE ORE BIN CONVEYOR (U-71) after through FINE ORE TRANSFER CONVEYOR (U-73) and by there WAY GATE GATE MECHNAISM MECHNAISM A1, B1, B1, C1 it is transferred to FINE ORE ORE BIN NEW or OLD through FOB TRIPPER TRIPPER CONVEYOR CONVEYOR (U-75A, (U-75A, B) respectively respectively .The ore particle size of after sec. Crusher is of size (-50mm) (-5 0mm) and that from TERTIARY CRUSHER is (19mm).
Flow sheet of Existing Secondary & Tertiary Crusher House All dimensions are in mm mm unless otherwise mentioned
Tertiary Surge Bin
U-35 D D Vib Screen +50
S D Vib Screen +19
+19
+19
-50+19 -19
Secondary Crusher
-19
Tertiary A
-19
Tertiary B
-19
Tertiary C
U-56
U-5 8 6 0 U- 6 U-71 Flap Gate System for Diversion to Old F OB & New FOB
U73 U-75A
Old FOB
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U-75B
New FOB
GRINDING AREA Process Flow: Grinding Area basically has three circuits of Rod Mill & Ball Mill, which are feeded as follows:
The crushed ore from FOB’S (Old) Chute is routed through conveyors 94A,B & C. The material
From 94A goes to Rod Mill I through 96A and that of 94B goes to Rod Mill II through 96B also some material from 94C goes to Rod Mill II and major portion of material from conveyor 94C goes to Rod Mill III through 95C & 96C, Rod Mill III is also feeded through New FOB’S Chute which comes from conveyor 94D & 94E and then trough 95B to 96C. The feeding of material to different Rod Mills depend upon the Weight Controller closed loop system placed on these conveyors. The three circuits of Ball Mill & Rod Mill are similar in structure and function. So in short we 24
can say that Close circuit wet grinding is arranged in three parallel circuits of rod & ball mill combination combination of 1500 TPD for flexibility in operation operation and maintenance. maintenance. The mill discharge goes to hydro cyclones for classification. The pulp of 80% minus 63 microns goes to the lead conditioners.
System Applications & Products – SAP Introduction to SAP SAP was founded in 1972 in Walldorf, Germany. It stands for Systems, Applications and Products in Data Processing. Over the years, it has grown and evolved to become the world premier provider of client/server business solutions for which it is so well known today. The SAP R/3 enterpri enterprise se applica applicatio tion n suite suite for open client/ client/serv server er systems systems has establis established hed a new standard for providing business information management solutions.
The main advantage of using SAP as your company ERP system is that SAP have a very high level level of integra integratio tion n among among its individu individual al applicat applications ions which which guarant guarantee ee consiste consistency ncy of data throughout the system and the company itself.
In a standard SAP project system, it is divided into three environments, Development, Quality Assurance and Production. The development system is where most of the implementation work takes place. The quality assurance system is where all the final testing is conducted before moving the transports to the production environment. en vironment. The production system is where all the daily business activities occur. It is also the client that all the end users use to perform their daily job functions. To all company, the production system should only contain transports that have passed all the tests. SAP is table drive customization customization software. software. It allows businesses businesses to make rapid changes in their business requirements with a common set of programs. User-exits are provided for business to add in additional source source code. Tools such as screen variants variants are provided to let you set fields attributes whether to hide, display and make them mandatory fields.
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INTRODUCTION: The Financial Accounting (FI) application component fulfils all the international requirements that must be met by the financial accounting department of an organization. It provides the following features:
•
Management and representation of all accounting data: All business transactions are recorded according to the document principle, which provides an unbroken audit trail from the financial statements to the individual documents.
•
Open and integrated data flow: Data is available in real time within Financial Accounting. Postings made in the sub ledgers always generate a corresponding posting in the general ledger.
•
Preparation of operational information to assist strategic decision-making within the organisation.
•
Integration of Financial Accounting with other components.
•
All accounting-relevant transactions made in Logistics (LO) are posted real-time to Financial Accounting by means of automatic account determination. This data can also be passed on to Controlling (CO). This ensures that logistical goods movements (such as goods receipts and goods issues) are exactly reflected in the value-based updates in accounting.
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The below diagram presents an overview how the data flows from various processes into Financial accounting.
Financial Accounting
Accounts receivable accounting FI-AR Accounts payable accounting FI-AP
Treasury Management
General Ledger Balance Sheet
Profit & Loss
Product costs Overhead costs Financial statement Profit center
Asset accounting FI-AA
HUMAN RESOURCES INVENTORY MANAGE. PURCHASING SALES
The Financial Accounting Module will cover the following business processes of HZL: Cash Accounting :- Receipts of Cash (withdrawals from Bank or refund of advances from employees etc), payments to employees for Expenses like travel expenses, reimbursement of conveyance expenses, advances etc., Bank Accounting:- Accounting of Collections, payments made to Vendors with respect to Invoices and Advance Payments to Vendors, Direct Expense Payments, Bank Reconciliation, Bank Transfers etc., Customer Accounting:– Accounting of Advances / collections, Cheque reversals, Debit & Credit Notes and maintenance of Customer Accounts. Vendor Accounting: – Accounting of Purchases, Invoice Booking (foreign / local), TDS deductions for the vendors, making advances / payments and analysis of vendor accounts. Accounting of TDS :- Deductions, making payments to Tax Authorities, Issue of Certificates and preparation of Annual Returns.
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Monthly Closing operations :- Booking of provisional entries, Monthly depreciation posting, SWOT ANALYSIS STRENGHT :--
1.
Biggest mining company in the world for Zinc
2.
It has centralized processes which saves time & resources
3.
Follows a 5S practice and hence improves processes and becomes more efficient
4.
6 sigma and quality management by self managed teams
5.
Providing economic plans to the customers as well as believes in cost reduction methods
WEAKNESS :--
1.
The systems used by them are outdated
2.
The processes are still manual
3.
The company faces a lot of problems due to union as all the decisions are influenced by union. A lot of auditors come every time which increases cost.
4.
OPPORTUNITY :--
1. Has a global presence and can still acquire other companies. 2. Provides a lot of vacancies for the staff every year. 3. An also venture into resources like copper and aluminum by acquiring Hindustan Coppers in Rajasthan.
THREATS :-
1. The other major competitor’s world wide 2. Depleting ore resources 3. Reduction in the no. of costumers
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ANALYSIS AND INTERPRETATION
29
PARAMETERS
SHAREHOLDERS FUNDS
UNSECURED LOANS
FIXED ASSETS
INVESTMENTS
CURRENT ASSETS,LOANS & ADVANCES
HINDUSTAN ZINC LIMITED
EXPENDITUR E
INCOME
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CURRENT LIABILITIES & PROVISIONS
NET CURRENT ASSETS
PROFITS
SHAREHOLDERS FUNDS MILLION( Rs.)
CAPITAL 100000 80000 60000 40000 20000 0
1 0 0 2
3 0 0 2
5 0 0 2
7 0 0 2
9 0 0 2
1 1 0 2
3 1 0 2
TABLE 1 PERCENTAGE CHANGE IN SHAREHOLDERS FUNDS EVERY FINANCIAL YEAR AS COMPARED TO THE PREVIOUS FINANCIAL YEAR.
TABLE 2 PERCENTAGE CHANGE IN SHAREHOLDERS FUNDS EVERY YEAR AFTER PRIVATIZATION AS COMPARED TO BEFORE PRIVATIZATION.
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008
EFFECT DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 8.01 9.60 28.82 37.88 65.07 122.37 75.76
2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
INCREASE INCREASE INCREASE INCREASE INCREASE
21.17 26.23 5.23 7.85 9.25
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
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EFFECT DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 8.01 15.90 141.18 194.67 321.36 714.63 1110.13 1345.26 1698.16 1782.00 1921.25 2098.85
ANALYSIS
The shareholders fund contributes of share capital and reserves & surplus.
The shareholders fund increased by 30% in financial year 2003-2004, by 79% in financial year 2004-2005 and by 204% in financial year 2005-2006 after privatization as compared to that of financial year 2001-2002 i.e before privatization.
In year 2004 reserves & surplus increased to Rs. 10834.42 million i.e an increase of Rs. 3462.6 from year 2001.
In year 2005 reserves & surplus increased to Rs.16552.11 million i.e an increase of Rs. 9174.85 from year 2001.
In year 2006 reserves & surplus increased to Rs. 30072.5 million i.e an increase of 204% from year 2001.
In year 2007 reserves & surplus increased to Rs 72045.3
million i.e an increase of
557%from year 2001.
In year 2008 reserves & surplus increased to Rs 114256.6 million i.e an increase of927% from year 2001.
In year 2008-2009 (14357.58)shareholder fund will be increase as compare to year 200708 (11848.19)
In year 2009-10 (18123.97) shareholder fund will be increase as compare to year 2008-09 (14357.58)
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UNSECURED LOANS
70 60 50 40 30 20 10 0 2001
2003
2005
2007
2009
2011
2013
TABLE 3 PERCENTAGE CHANGE IN UNSECURED LOAN EVERY FINANCIAL YEAR AS COMPARED TO THE PREVIOUS FINANCIAL YEAR
TABLE 4 PERCENTAGE CHANGE IN UNSECURED LOANS EVERY YEAR AFTER PRIVATIZATION AS COMPARED TO THE PREVIOUS FINANCIAL YEAR
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012
EFFECT DECREASE DECREASE DECREASE DECREASE DECREASE DECREASE CONSTANT CONSTANT INCREASE DECREASE DECREASE
CHANGE(%) 33.50 97.34 39.82 3.92 2.32 99.93 0.39 0.39 60.47 52 43
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EFFECT DECREASE DECREASE DECREASE DECREASE DECREASE DECREASE DECREASE DECREASE INCREASE DECREASE DECREASE
CHANGE(%) 33.50 20.14 10.8 93 1.41 93.11 93.11 10.39 1611 10 12
ANALYSIS The unsecured loans has shown a minor decrease after privatization.It decreased up to
the extent of 1.41% as compared to financial year 2001-2002.
The unsecured loan amount was Rs. 56.62 million in year 2001 and it decreased to Rs.
55.80 million in year 2006.
The company raised unsecured loans through banks in the year 2005 and 2006 to the
extent of Rs. 3.92 million and Rs. 55.80 million respectively.
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FIXED ASSETS
CRORE (Rs.)
12000 10000 8000 6000
FIXASSETS
4000 2000 0 2001 2003 2005 2007 2009 2011 2013 TABLE 5 PERCENTAGE CHANGE IN FIXED ASSETS EVERY FINANCIAL YEAR AS COMPARED TO TO THE PREVIOUS FINANCIAL YEAR.
TABLE 6 PERCENTAGE CHANGE IN FIXED ASSETS EVERY YEAR AFTER PRIVATIZATION AS COMPARED TO BEFORE PRIVATIZATION.
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2012-2013
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2011-2012 2012-2013
EFFECT DECREASE DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 8.29 4.63 35.10 106.77 4.01 49.65 45.00 25.24 39.58 45-58 60-62
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EFFECT DECREASE DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 8.29 108.36 146.40 302.73 314.87 471.23 683.33 855.81 1194.60 2 3
ANALYSIS
Financial year 2004-2005 showed an increase of 188.34% in fixed assets as compared to financial year 2005-2006.
This increase was mainly because after privatization the company’s major profit seeking unit
Agucha mines went into expansion. Previously it was operating with only one production line, but from Jan 2005 it introduced stream 2 production line with an expenditure of Rs. 200 crore.
The asset value in 2001 was Rs. 6642.43 million and it increased to Rs.19181 million in year 2006.
Financial year 2006-2007 showed an increase of 332.16% in fixed assets as compared to Financial year 2007-2008
IN year 2009-10 (7277.05)fixed assets will be increase as compared to year 2008-09(5213.31)
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INVESTMENT CRORE (Rs.)
16000 14000 12000 10000 8000 6000 4000 2000 0 2001
2003
2005
2007
2009
2011
2013
TABLE 7 PERCENTAGE CHANGE IN INVESTMENT EVERY FINANCIAL YEAR AS COMPARED TO PREVIOUS FINANCIAL YEAR
TABLE 8 PERCENTAGE CHANGE EVERY IN INVESTMENT YEAR AFTER PRIVATIZATION AS COMPARED TO BEFORE PRIVATIZATION.
YEARS 2001-2002
CHANGE(%) _
YEARS 2001-2002
EFFECT NO CHANGE
_
2002-2003
NO CHANGE
645.78 11.06 133.30 174.37 43.81 9.41 58 .02 -5 10
2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2012-2013
INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE DECRESAE DECREASE
2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-12
EFFECT NO CHANGE NO CHANGE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE DECREASE INCREASE
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CHANGE(%) _ _ 645.78 828.34 1936.27 5302.62 7625.78 8344.01 13185.41 9334
ANALYSIS
Investments grew by133.30% in financial year 2005-2006 and by 2209.7% in financial
Year 2005-2006 as compared to financial year 2001-2002.
In financial year 2001-2002, investments was made in Andhra Pradesh Gas Corp. Ltd.
But after privatization the company invested in mutual funds.The major being Birla Sun Life, ICICI Prudential, Reliance, SBI Magnum fund, UTI, HSBC, etc.
In year 2002-03 the investment will be constant
In year 2003-04(619.32) investment will be increase as compare to the year 2002-03
In year 2004-05 (687.87) investment will be increase as compare to the year 2003-04
In year 2005-06 to year 2007-08 investment will be increase continous
In year 2008-09 (6928.87) investment will be increase as compare to the year 2007-08
In year 2009-2010 (10949.17) investment will be increase 2010-2011 (12225.17)
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CURRENT ASSETS, LOANS AND ADVANCES CRORE (Rs.)
12000 10000 8000 6000 4000 2000 0 2001
2003
2005
2007
2009
2011
2013
TABLE 9 PERCENTAGE CHANGE IN CURRENT ASSETS,LOANS AND ADVANCES EVERY FINANCIAL YEAR AS COMPARED TO PREVIOUS FINANCIAL YEAR
TABLE 10 PERCENTAGE CHANGE IN CURRENT ASSETS, LOANS AND ADVANCES EVERY YEAR AFTER PRIVATIZATION AS COMPARED TO BEFORE PRIVATIZATION.
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012
EFFECT DECREASE INCREASE INCREASE DECREASE INCREASE INCREASE INCREASE INCREASE DECREASE INCREASE INCREASE
39
EFFECT DECREASE INCREASE INCREASE DECREASE INCREASE INCREASE INCREASE INCREASE DECREASE INCREASE INCREASE
2012-2013
INCREASE
2012-2013
INCREASE
PARAMETERS
INVENTORIE S CURRENT ASSETS LOANS & ADVANCES
OTHER CURREN T ASSETS
SUNDRY DEBTOR S
CASH AND BANK BALANCE S
LOANS AND ADVANCES
ANALYSIS There is an increase in current assets to the extent of 94.26% in financial year 2007-2008
from financial year 2001-2002 due to increase in debtors,cash & bank balances
However this increase was followed by a decrease of 3.68% in financial year 2004-2005 as
compared to financial year 2001-2002.
40
CURRENT LIABILITIES AND PROVISIONS 2500
MILLION (Rs.)
2000 1500 1000 500 0
1 0 0 2
3 0 0 2
5 0 0 2
7 0 0 2
9 0 0 2
1 1 0 2
3 1 0 2
TABLE 11 PERCENTAGE CHANGE IN CURRENT LIABILITIES AND PROVISIONS EVERY FNANCIAL YEAR AS COMPARED TO PREVIOUS FINANCIAL. YEAR
TABLE 12 PERCENTAGE CHANGE IN CURRENT LIABILITIES AND PROVISIONS EVERY YEAR AFTER PRIVATIZATION AS COMPARED TO BEFORE PRIVATIZATION
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
EFFECT DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 14.98 1.63 49.24 20.16 17.87 37.06 8.66 11.40 32.45 10.00 12.00 15
ANALYSIS 41
EFFECT DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 14.98 101.63 151.72 173.73 204.78 280.69 305.03 339.83 450.12 470.20 495.00 525.00
The current liabilities has increased by 204.78% in financial year 2005-2006 as compared to financial year 2001-2002 i.e before privatization.
This increase was mainly due to increase in provisions & current liabilities of the company.
In year 2002-03 (299.35crore ) current liabilities and provision will be increase as compared to the previous year 2001-02 (294.54 crore)
As compared to 2001 -02 current liabilities& provisions will be increase continuous because increase in the provision ¤t liabilities
In year 2008-09 (1000.95) current liabilities & provision will be increase as compared to the previous year
In year 2009-2010 (1325.80) current liabilities &provision will be increases as compared to the previous year.
In year 2010-2011 (1959) current liabilities &provision will be increases as compared to the previous year.
In year 2011-2012 (2118.60) current liabilities &provision will be increases as compared to the previous year.
In year 2012-2013 (2364) current liabilities &provision will be increases as compared to the previous year.
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INCOME
CRORE (Rs.)
16000 14000 12000 10000 8000 6000 4000 2000 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
TABLE 15 Percentage Change In Income Every Financial Year As Compared To Previous Financial Year
TABLE 16 Percentage Change In Income Every Year After Privatization As Compared To Before Privatization
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010. 2010-2011 2011-2012 2012-2013
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
EFFECT DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE DECREASE DECREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 8.60 9.17 30.17 20.7 70.83 119.45 0.70 24.26 32.18 20.00 10.00 19
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EFFECT DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE DECREASE DECREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 8.60 92.2 126.63 152.88 261.18 575.08 571.01 432.48 548.10 570 585 602
ANALYSIS There is an increase of 15.7% in financial year 2003-2004 as compared to financial year
2001-2002.This increase is mainly because of the increase in sales by Rs. 3706 million. There is an increase of 39.7% in financial year 2004-2005 i.e increase of Rs. 6644.5
million from financial year 2001-2002. There is an increase of 138% in financial year 2005-2006 i.e increase of Rs. 23202.5
million from financial year 2001-2002 There is an increase of 20% in financial year 2010-2011 i.e increase of Rs. 10489 CR
from financial year 2010-2011 There is an increase of 00% in financial year 2011-2012 i.e increase of Rs. 12061 CR
from financial year 2011-2012 There is an increase of 18% in financial year 2012-2013 i.e increase of Rs. 14731 CR
from financial year 2012-2013
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EXPINDITURE CRORE (RS)
7000 6000 5000 4000 3000 2000 1000 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
TABLE 17 PERCENTAGE CHANGE IN EXPENDITURE EVERY FINANCIAL YEAR AS COMPARED TO PREVIOUS FINANCIAL YEAR
TABLE 18 PERCENTAGE CHANGE IN EXPENDITURE EVERY YEAR AFTER PRIVATIZATION AS COMPARED TO BEFORE PRIVATIZATION.
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
EFFECT INCREASE DECREASE DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 2.51 1.04 8.91 23.68 25.02 31.59 17.37 18.55 14.50 10.00 11.25 13.25
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EFFECT DECREASE DECREASE DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 2051 82.53 80.05 99.00 123.78 164.12 192.64 228.39 261.51 272.58 285.45 301.25
ANALYSIS After privatization in the financial year 2003-2004 there is a decrease in expenditure up
to 18% as compared to financial year 2001-2002.
However there is a slight increase in expenditure in the financial year 2004-2005 as
mining expenses and depreciation increased up to Rs. 2612 million and Rs. 286.25 million respectively.
There is a huge increase of 30% in expenditure in the financial year 2005-2006 as
interest and depreciation increased up to Rs. 4452 million and Rs. 832.6 million respectively There is a increase of 10% in expenditure in the financial year 2010-2011 as interest and
depreciation increased up to Rs. 4422 cr. in respectively There is a huge increase of 11.25% in expenditure in the financial year 2011-2012 as
interest and depreciation. There is a huge increase of 13.25% in expenditure in the financial year 2012-2013
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NET PROFIT
MILLION (Rs.)
2001 169.26 17.96 1421
4632 4902 4041.41 2727.61
4046 6553
6927
14720
2002 2003 2004 2005 2006 2007 2008 2009
43960.7
2010 44420
2011 2012 2013
TABLE 19 PERCENTAGE CHANGE IN NET PROFITS EVERY FINANCIAL YEAR AS COMPARED TO PREVIOUS FINANCIAL YEAR
TABLE 20 PERCENTAGE CHANGE IN NET PROFIT EVERY YEAR AFTER PRIVATIZATION AS COMPARED TO BEFORE PRIVATIZATION
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
EFFECT DECREASE DECREASE DECREASE INCREASE INCREASE INCREASE DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 59.83 109.16 184.61 61.97 124.6 201.6 1.03 37.96 48.16 16.00 19.00 21.00
47
EFFECT DECREASE DECREASE DECREASE INCREASE INCREASE INCREASE DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE
CHANGE(%) 59.83 209.16 5953 964.2 2104.7 6535.9 6468.6 4013.12 5946.14 5342 6667 8513
ANALYSIS
After privatization in April 2002 the profits of the
company in the consecutive four financial years were:
Increase of 139% in financial year 2003-2004 Increase of 287% in financial year 2004-2005 Increase of 780% in financial year 2005-2006 Increase of 2525% in financial year 2006-2007
Profits in 2002-2003 was 109% of the previous year
2001- 2002.
Profits in 2003-2004 was 184% of the previous year
2002- 2003.
Profits in 2004-2005 was 62% of the previous year
2003-2004.
The profit % decreased in financial year 2004-2005
as heavy investment was made in introducing stream
II production line in Rampura Agucha mines.
Profits in 2006-2007 were 202% of the previous year 2005-2006.
Profits in 2010-2011 is 4902 Profits in 2011-2012 is 4632 Profits in 2012-2013 is 6927
48
TURNOVER MILLIONS(RS)
TABLE 21
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 TABLE 22 TABLE 21
PERCENTAGE CHANGE IN TURNOVER EVERY YEAR AFTER PRIVATIZATION AS COMPARED TO BEFORE PRIVATIZATION
PERCENTAGE CHANGE IN TURNOVER EVERY FINANCIAL YEAR AS COMPARED TO PREVIOUS FINANCIAL YEAR. YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012
EFFECT DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE DECREASE DECREASE INCREASE INCREASE INCREASE
CHANGE(%) 6.56 16.29 30.48 18.75 76.05 120.04 7.97 27.89 41.13 10 16
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012
EFFECT DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE DECREASE DECREASE INCREASE INCREASE INCREASE
CHANGE(%) 6.56 112.17 125.23 148.71 263.65 582.13 535.12 386.28 545.19 600 615
2012-2013
INCREASE
14
2012-2013
INCREASE
650
49
EARNING PER SHARE MILLION (Rs.)
1200
1051.24 1040.41
1000
956.47
800 645.54
600 348.73 400 155.09 200
40.0416.0833.6495.75
163.33 116 130.8
0 20012002 20032004 20052006 2007 2008 2009 2010 2011 2012 2013
TABLE 23 PERCENTAGE CHANGE IN EPS EVERY FINANCIAL YEAR AS COMPARED TO PREVIOUS FINANCIAL YEAR.
TABLE 24 PERCENTAGE CHANGE IN EPS EVERY YEAR AFTER PRIVATIZATION AS COMPARED TO BEFORE PRIVATIZATION.
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
YEARS 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
EFFECT DECREASE INCREASE INCREASE INCREASE INCREASE INCREASE DECREASE DECREASE INCREASE DECREASE INCREASE INCREASE
CHANGE(%) 59.84 109.20 184.00 61.97 124.69 201.66 1.02 37.95 48.16 -800 10 18
50
EFFECT DECREASE DECREASE INCREASE INCREASE INCREASE INCREASE DECREASE DECREASE INCREASE DECREASE INCREASE INCREASE
CHANGE(%) 59.84 209.20 595.46 964.49 2168.71 6537.56 6470.21 4014.55 5948.19 1000.00 1025.00 1060
ANALYSIS
There has been a tremendous increase in EPS after privatization.
In 2003-2004 EPS was Rs. 95.75
In 2004-2005 EPS was Rs. 155.09
In 2005-2006 EPS was Rs. 348.73
In 2006-2007 EPS was Rs.1051.24
IN 2007-2008 EPS was RS 104O.41
IN 2008-2009 EPS was Rs 645.54
IN 2009-2010 EPS was Rs 956.47
EPS IN 2001-2002 WILL BE DECREASE
IN 2007-2008 &2008-2009 EPS ALSO DECREASE
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5’SMODULE SORT : clearly distinguish
SYSTAMATIC: keep needed items in correct place &sequence to use to allow for easy
needed items from unneeded items & eliminate the later &quick
retrieval SUSTAIN:self discipline _educate people so that 5S expands beyond initial limits & turns into naturalstandard behaviour
STANDARIZE: set easy to follow Standards & develop a structure to support the first three pillars
SHINE: clean it so defects are easy to spot & eliminate.
STANDARIZE
SHINE IT
(STANDARDIZE CLEANUP) (CLEANLINESS)
52
INTRODUCTION OF MODERN TECHNIQUES OF ANALYSIS OF FINANCIAL STATEMENT
53
MEANING AND DEFINITIONS “Analysing Financial Statements 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.”
Metcaff and Titard
“The Analysing interpretation of the Financial Statements results in the presentation of information that will be aid in decision-making by business mangers, investors and creditors as well as other group who are interested in the financial status and operating results of a business.”
Kennedy and McMullen
“Financial Statement Analysis is largely a study of relationship among the various financial factors in a business, as disclosed by a single set of statements and a study of the trends of these factors, as shown in a series of statements.”
John N. Myer
“Interpretation of accounts may be defined as the art and science of translating the figures in such a way as to reveal the financial strength and weakness of a business and the causes which have contributed therein.”
Spicer and Pegler
54
TECHNIQUES OF THE FINANCIAL STATEMENT ANALYSIS The analytical tools or techniques of financial statement analysis are used to ascertain or measure the relationship among the financial statement items of a single set of statement along with the change that have taken place in these items in successive year. The following are the more commonly used techniques in the analyzing financial statements. 1. 2. 3. 4. 5.
Ratio Analysis Trend Analysis Funds Flow Analysis Common-size statements analysis Other techniques of Analysis
A detailed description of the above-cited techniques is given below 1. Ratio Analysis:Alexander wall is said to have been the founder of the ratio analysis. In 1909 he put forth a detailed article on ratio analysis in which he said that analysis could be made easier by establishing a quantitative relationship between the various items contained in financial statement.
‘Ratio Analysis’ is the primary technique used in judging the condition as portrayed by the financial statements. In certain situations the ratios can be used to study financial growth, development and the existing condition of an enterprise. “A ratio is simply one number expressed in terms of another. It is calculated by dividing one number- the base, by the other. A percentage is one kind of ratio in which the base is taken as equaling 100 and the quotient is expressed as ‘per hundred’ of the base.”
The analyst and interpreter must draw inferences before arriving at any conclusion regarding the financial position of an enterprise, within the established criteria. Thus, the ratios are not conclusive and final in themselves. “It should be remembered that ratios are only guides in the analysis of financial statements, and not conductive ends in themselves.” Stressing the importance of ratios, Korn S. Winton has observed “ If a ratio is to be important, it must not only represent a true relationship, but must also aid the analyst in making his immediate decision.” The ratio used in financial statement analysis may be classified as under : a) Balance Sheet Ratio b) Profit and Loss Account Ratios c) Combined or Inter-statement Ratios The details of the above are as follows:
55
a) Balance Sheet Ratio - Balance Sheet Ratio are the ratio are the ratios which express the relationship between two items or groups of items appearing in the balance sheet, such as Current Ratios, Acid Test Ratio, Debt-Equity Ratios etc. b) Profit and Loss Account Ratios – These are ratios by which a relationship is established between two items or groups of item appearing in the Profit and Loss Account, such as profit margin, inventory ratio, operating ratio, etc. c) Combined or Inter-statement Ratios – The third type of ratios express the relationship of figures between two items or group of items-one appearing in the balance sheet and the other in the Profit and Loss Account, such as net Profit to Net Profit to Net Worth Ratio, Sales to Working Capital Ratio, Return on Share-holder’s fund Ratio, etc. The other way of classifying the ratio is according to the nature and object of calculating ratio. The classification may be as given below: a) Liquidity Ratios b) Profitability Ratios c) Leverage Ratios d) Activity Ratio A brief description of the above classification is as following: a) Liquidity Ratios - The ratios which measure the working capital position and the enterprise’s ability to make payment of short-term obligations are called liquidity ratios for example, Current Ratio, Quick Ratio, Inventory to working Capital Ratio, etc. b) Profitability Ratios - These ratios which X-Ray the profit making ability of the enterprise and the management’s efficiency in operating the business activities, like Net Profit to Net Worth Ratio, Return on Capital Employed, Operating Profit Ratios, etc. c) Leverage Ratios - These ratio measure the extent to which the enterprise has been financed by own funds or debts such as Debt Equity Ratio, Capital Gearing Ratio, Propriety Ratio, etc. d) Activity Ratio- These are designed to measure whether the enterprises is using resources, skillfully and effectively as Turnover of Fixed Assets, Turnover of Working Capital, etc. 2. Trend Analysis Trend Analysis depicts the changes in an item is an item or a group of item of financial statement over a period of time. Trend figures are index numbers giving a bird’s eye-view over a period of time. A normal year is chosen as the base year and the figures of that year are taken equal to a hundred and index Number of the remaining years under study of that particular item are calculated. It is a dynamic and horizontal type of analysis indicating whether the enterprise’s direction of trend is upward or downward. Based on the past trend a forecast can be made above the future. 3. Fund Flow Analysis Balance sheet reveals the financial position of an enterprise at a given moment of time while the dynamic business operating involves a regular and smooth flow of funds affecting there by in some way or the other the preceding financial position The inflow and outflow of funds constitutes the core of the enterprise and provides a basis for analyzing the financial position the funds flow statement shows the sources and uses – from where funds were obtained and the used to which these funds were put-in during a period of time the sources may due to an increase in capital and loan by sale of fixed assets and investments and because of operating profits the uses
56
may be the consequence of a decrease in capital and loans by purchase of fixed assets and investments and on account suffering of operating losses. 4. Common- size statement Analysis
The comparative financial statements and the ratios as tools of analysis have one common shortcoming- the analyst can’t comprehend the changes that have taken place in relation to total assets in case of balance sheet and net sales in case of profit and loss account. The common-size statement analysis is a technique of analyzing financial statement in which the total of assets or liabilities and net sales with reference to balance sheet and profit and loss account respectively are taken equal to a hundred and the percentage of each items is calculated accordingly. The technique is “useful when we wish to compare one company with the other for presentation of the data in the percentage from, eliminates problems relating to differences in organization size.” R.D. Kennedy and McMullen observed that, “The commonsize statement are most valuable to the analyst in studying current financial position and operating result of a business and especially in making comparisons between companies in the same industry and with the industry standards.” 5. Comparative Financial Statements Analysis
Comparative Financial Statements refers to various financial statement of an enterprise, which are prepared in such a way so as to provide a relative picture of the various elements embodies in such statements. These statements mainly include two types of analytical statement vizcomparative balance sheets and comparative income statements, which facilitate comparison between two or more similar enterprises in the same industry and two or more periods for the same enterprise. The committee of accounting procedure of the AICPA commented for Comparative Financial Statements “the presentation of Comparative Financial Statements in annual and other reports enhances the usefulness of such reports and brings out more clearly the nature and trends of current changes affecting the enterprise. Such presentation emphasizes the fact that statement for a series of periods are far more significant than those for a single period.” The comparative statements indicate the (a) absolute date in money value, (b) increase or decrease in absolute data in term of money value, and (c) increase or decrease in absolute data in terms of percentage.
6. Other Techniques for the Analysis
There are so many other techniques, besides those enumerated above, applying in analyzing financial statements. The help of several statistical tools in financial statement analysis in sought. These include index numbers, standard deviation, Coefficient of standard deviation, correlation regression, Chi-square, F-Test etc. The use of diagrams and graphs is also common for making financial statement analysis, providing a vived picture of trends and relationships. Sometimes the techniques of break-even analysis and cash flow analysis are also used.
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TYPE OF ANALYSIS CLASSIFICATION ACCORDING TO MATERIAL USED Internal Analysis External Analysis
CLASSIFICATION ACCORDING TO PROCESS OF ANALYSIS Dynamic or Horizontal Analysis Static or Vertical Analysis
PROCESS OF FINANCIAL ANALYSIS
1. Study of Financial Statements 2. Rearrangement of Financial Information 3. Approximation 4. Establishing the Relationship among elements 5. Knowledge of the Trend 6. Deep Study of Trend 7. Conclusions and Advice
MERITS OF ANALYSIS MANAGER’S OBJECTIVES Efficiency Decision Making Control Valuation LENDER’S OBJECTIVES Liquidity
58
Safety Credit Repayment Capacity Earning Capacity
INVESTOR’S OBJECTIVES Managerial Efficiency Earning Capacity or Profitability Safety Market Situation
OWNER’S OBJECTIVES
GOVERNMENT’S OBJECTIVES
LABOURER’S OBJECTIVES
MISCELLANEOUS PARTIES OBJECTIVES
FUNCTIONAL IMPORTANCE Disclosure of Information Decision Making Work Operation Coordination Control Planning Comparative Study Availability of Necessary Information to Related Parties
DEMERITS OF ANALYSIS
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ONLY CURRENT YEAR’S DATA ARE INSUFFICIENT PAST DATA ARE NOT RELIABLE QUICK CHANGES IN PRICE LEVEL RESULTS OF FINANCIAL ANALYSIS AND FACTS
Balance Sheet Particulars
Mar'13
Mar'12
Mar'11
Mar'10
Mar'09
Liabilities
12 Months 12 Months 12 Months 12 Months 12 Months
Share Capital
845.06
845.06
845.06
422.53
422.53
Reserves & Surplus
31430.68
26036.20
21688.13
17701.44
13935.05
Net Worth
32275.74
26881.26
22533.19
18123.97
14357.58
Secured Loan
.00
.00
.00
.00
8.30
Unsecured Loan
.39
.39
.39
60.47
.39
TOTAL LIABILITIES
32276.13
26881.65
22533.58
18184.44
14366.27
Gross Block
12264.80
11657.90
9802.33
8240.66
5855.51
(-) Acc. Depreciation
3781.06
3145.08
2548.12
2076.57
1750.59
Net Block
8483.74
8512.82
7254.21
6164.09
4104.92
Capital Work in Progress
1081.85
604.94
875.23
1112.96
1108.39
Investments
14539.88
12694.85
9334.59
10949.17
6928.87
Inventories
1111.09
797.94
762.38
451.74
545.66
Sundry Debtors
402.87
332.45
208.89
151.83
164.94
Cash and Bank
6942.10
5255.32
5632.91
927.53
2719.15
Loans and Advances
2903.88
1243.90
991.82
466.64
366.67
Total Current Assets
11359.94
7629.61
7596.00
1997.74
3796.42
Assets
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Current Liabilities
2364.41
2118.60
1959.37
1699.98
1374.20
Provisions
824.87
441.97
567.08
339.54
198.13
Total Current Liabilities
3189.28
2560.57
2526.45
2039.52
1572.33
NET CURRENT ASSETS
8170.66
5069.04
5069.55
-41.78
2224.09
Misc. Expenses
.00
.00
.00
.00
.00
TOTAL ASSETS(A+B+C+D+E)
32276.13
26881.65
22533.58
18184.44
14366.27
Profit and Loss Account
Mar'13
Mar'12
Mar'11
Mar'10
Mar'09
12Months
12Months
12Months
12Months
12Months
Sales Turnover
13658.14
12061.09
10489.82
8437.87
6141.47
Excise Duty
958.30
648.70
581.89
414.71
452.96
NET SALES
12699.84
11412.39
9907.93
8023.16
5688.51
Other Income
0
0
0
0
0
TOTAL INCOME
14731.99
12009.96
10857.81
8690.62
6520.54
Manufacturing Expenses
1736.78
2890.89
2459.33
1879.46
1588.80
Material Consumed
1855.59
1472.18
1032.76
662.93
652.58
Personal Expenses
649.91
534.64
510.78
457.36
379.00
Selling Expenses
.00
179.99
174.13
172.89
176.02
INCOME:
EXPENDITURE:
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Administrative Expenses
1975.92
265.23
259.08
193.47
178.89
Expenses Capitalised
.00
.00
-14.05
-13.33
-20.94
Provisions Made
.00
.00
.00
.00
.00
TOTAL EXPENDITURE
6218.20
5342.93
4422.03
3352.78
2954.35
Operating Profit
6481.64
6069.46
5485.90
4670.38
2734.16
EBITDA
8513.79
6667.03
6435.78
5337.84
3566.19
Depreciation
647.04
610.67
474.74
334.25
285.27
Other Write-offs
.00
.00
.00
.00
.00
EBIT
7866.75
6056.36
5961.04
5003.59
3280.92
Interest
29.10
13.95
18.28
40.75
21.88
EBT
7837.65
6042.41
5942.76
4962.84
3259.04
Taxes
910.07
1410.21
1040.76
972.89
663.05
Profit and Loss for the Year
6927.58
4632.20
4902.00
3989.95
2595.99
Non Recurring Items
-17.53
902.13
14.77
43.81
91.05
Other Non Cash Adjustments
-10.57
-8.29
-16.28
7.65
40.57
Other Adjustments
.00
.00
.00
.00
.00
REPORTED PAT
6899.48
5526.04
4900.49
4041.41
2727.61
Preference Dividend
.00
.00
.00
.00
.00
Equity Dividend
1309.85
1014.08
422.53
253.52
169.01
Equity Dividend (%)
155.00
120.00
50.00
60.00
39.99
Shares in Issue (Lakhs)
42253.19
42253.19
42253.19
4225.32
4225.32
EPS - Annualised (Rs)
16.33
13.08
11.60
95.65
64.55
KEY ITEMS
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RESEARCH METHODOLOGY Research is common parlance to refer to a search for knowledge. We can also define research as “Scientific ad systematic search for pertinent information on a specific topic” Research is careful investigation or inquiries for new facts in any branch of
knowledge. Researches are basically
systematic inquiry with customer’s critical examination with objectives to search new facts or interpret know facts in new light.
Research methodology is a way to systematically solve the research problems. It may be understood as a science of studying how research is done scientifically. We study the various steps that are generally adopted by a researcher in studying his research problem along with the logic behind them. It is necessary for the researcher to know not only need to know how to develop certain indices or tests, how to calculate the mean, the mode, the median, standard deviation and chi – square, how to apply the particular research techniques, are relevant and which are not and what would they mean and indicate and why? Researchers
also need to understand the assumptions underlying various techniques
and they need to know the criteria by which they can decide that certain techniques and procedures will be applicable to certain problems and others will not.
Two type of research design was used?
Exploratory Research Design
Descriptive Research Design
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Exploratory Research
Exploratory research is a type of research conducted because a problem has not been clearly defined. Exploratory research helps determine the best research design, data collection method and selection of subjects. Given its fundamental nature, exploratory research often concludes that a perceived problem does not actually exist. Exploratory research often relies on secondary research such as reviewing available literature and/or data, or qualitative approaches such as informal discussions with consumers, employees, management or competitors, and more formal approaches through in-depth interviews, focus groups, projective methods, case studies or pilot studies. The Internet allows for research methods that are more interactive in nature: E.g., RSS feeds efficiently supply researchers with up-to-date information; major search engine search results may be sent by email to researchers by services such as Google Alerts; comprehensive search results are tracked over lengthy periods of time by services such as Google Trends; and Web sites may be created to attract worldwide feedback on any subject. The results of exploratory research are not usually useful for decision-making by themselves, but they can provide significant insight into a given situation. Although the results of qualitative research can give some indication as to the "why", "how" and "when" something occurs, it cannot tell us "how often" or "how many."Exploratory research is not typically generalizable to the population at large.
Descriptive Research
Descriptive research is also known as statistical research, describes as data and characteristics about the population or phenomenon being studied. Descriptive research answers the questions who, what, where, when and how. Although the data description is factual accurate and systematic, the research cannot describe what caused a situation. Thus, descriptive research cannot be used to create a casual relationship, where one variable affects another. In other words, descriptive research can be said to have a low requirement for internal validity. The description is used for frequencies, averages and other statistical calculations. Often the best approach, prior to writing descriptive research, is to conduct a survey 64
investigation. Qualitative research often has the aim of description and research may follow-up with examinations of why the observations exist and what the implications of the findings are. In short, descriptive research deals with everything that can be counted and studied. However, there are always restrictions to that. Your research must have an impact to the lives of the people around you. For example, finding the most frequent disease that affects the children of a town. The reader of the research will know what to do to prevent that disease thus; more people will live a healthy life. The main goal of this type of research is to describe the data and characteristics about what is being studied. The idea behind this type of research is to study frequencies, averages, and other statistical calculations. Although this research is highly accurate, it does not gather the causes behind a situation. Descriptive research is mainly done when a researcher wants to gain a better understanding of a topic for example; a frozen ready meals company learns that there is a grown demand for fresh ready meals but does not know much about the area of fresh food and so has to carry out research in order to gain a better understanding. It is quantitative and uses surveys and the use of probability sampling. Descriptive research is the exploration of the existing certain phenomena. The details of the facts would not be known. The persons know the existing phenomena’s facts. We use the Descriptive research for the study which is explore the existing certain phenomena.
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What data collection methods were used?
Primary Data Collection Methods:
In primary data collection, you collect the data yourself using methods such as interviews and questionnaires. The key point here is that the data you collect is unique to you and your research and, until you publish, no one else has access to it. There are many methods of collecting primary data and the main methods include:
Questionnaires
Interviews
Secondary Data Collection Methods: Secondary data is the data which is available in readymade form and which is already used by people for some purposes. There may be various sources of secondary data such as-newspapers, magazines, journals, books, reports, documents and other published information.
Objective of Research
The main objective of study is to analyses the working capital management of Hindustan Zinc Limited.
•
Working capital management is very important in modern business. When we analyze and interpret the financial statement analysis of working capital is very useful for short term management of funds.
•
Working involves investment of funds of the company.
•
To make the analysis of elements or components of working capital to identify the items responsible for changes in working capital.
66
•
To study the liquidity position of the company.
RESEARCH PLAN
Data source
Secondary data
Research design
Analytical research
Scope of data
For ratio analysis i got only five years data (2001-02 & 2005-06) through companies’ booklet
Research tool
Trend analysis Compounded annual growth rate Line chart, pie chart
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Different form as hand books, reports, magazines, websites etc.
CONCLUSION
Ratio analysis is a very useful tool investigates, analyze & forecast the managerial issues.
Ratio analysis is a process of identifying the financial strengths & weakness of the company. Liquidity ratios measure the firm’s ability to meet current obligation. Liquidity plays a very momentous role in business management or to run the business.
Current ratio is a test of quality. It does not measure the quality of assets. Liabilities are
not subject to any fall in value of current ratio; it is very beneficial for the company to increase the confidence level of creditors.
Quick ratio of the company is also crossed the satisfactory level of quick ratio. Thus, if
HZl do not sale their inventory & it has to pay all its current liabilities, it may not face any difficulty to meet its obligation because its quick assets are 1.53 times of current liabilities.
Proportion of net working capital over the current liabilities is positive; it shows that
company having good liquidity & is in sound condition.
1942
- A small lead smelting pilot plant was set up at Tundoo near Dhanbadin Bihar. 1944
- Metal Corporation of India (MCI) was formed and all the assets of theCompany were transferred to MCI. 1945
- The Government of India surrendered the mining rights over Zawar toMewar durbar and MCI obtained the prospecting licence for 2 years andin 1950 obtained a mining lease.
68
1960
- MCI obtained licence for production of 9 000 tpa of lead and 5 40 000Ozs of silver p.a. 1966
- The company was Incorporated 10th January in Rajasthan. The Companyis a producers of Zinc and lead from the Company's Mines and Smelters. 1990
- Facilities for production of cobalt and indigenous lead-zinc oreswere commissioned during the year. In-house technology for therecovery of cobalt was made possible through R&D and Cooperation withBARC. 1993
- The application for prospecting licence for gold for Bhukia JagpuraBanswara District and Dungarpur District Rajasthan was subletted toRajasthan Government. 1994
- 40 37 31 900 shares disinvested in favour of Mutual Funds andFinancial Institutions. The Company allotted 188 00 000 shares to thePresident of India in 1992. 1996
- The Company entered into a MOU with BHP minerals Ltd. Australia forjoint venture project for exploration of base precious minerals inRajasthan. Another MOU was entered into with Vigego Vietnam andLa-Sarce France for a joint venture project for exploration at Pac-LangGold prospect in Vietnam. 1997
69
- The Company decided to develop Sindesar Khurd Lead-Zinc Silverdeposit in Rajsamand Rajasthan as a replacement mine to Rajpura-Daribawith a capacity to produce 1000 tpd Ore. The Company closed its DeganaTungstan Mine in Rajasthan as its operations became uneconomical. - Hindustan Zinc Ltd and Rajasthan State Mines and Minerals Ltd (RSMML)signed a memorandum of understanding of set up a Rs.3 300 crore powerproject near Udaipur in Rajasthan. - Hindustan Zinc Ltd (HZL) has entered into a memorandum of understanding for 1997-98 with the Government of India. - Public sector Hindustan Zinc has entered into three separate agreements with international mining majors for diversification intomining and prospecting of previous minerals in India and abroad. - The company has formed a joint venture with BRMG of France and Vietnam Rare & Precious Minerals Corporation (VMC) to explore anddevelop gold mines in the Southeast Asian country. - The company's second joint venture is with Nuigini Mining forexploration of gold in Andhra Pradesh Uttar Pradesh Madhya Pradeshand Karnataka. - The company's third joint venture is with the Australian major Broken Hill Proprietaries for prospecting of non-ferrous metals likezinc lead copper as well as gold in Rajasthan. - Hindustan Zinc Ltd (HZL) a public sector enterprise under theMinistry of Mines has entered into a memorandum of understanding (MoU)with BHPM Australia for grassroot exploration of zinc and lead alongwith other precious minerals in Rajasthan. - HZL has also entered into a MoU with CSIR for setting up a nickeltechnology proving plant (TPP) for extraction of nickel from overburdenof chromite at Sukhinda mines in Orissa. - HZL is likely to install a new zinc smelter with a capacity of around60 000 to 1 00 000 tonnes work for which will be initiated in 1998-99 and the plant is likely to be commissioned by the end of the Ninth Planor early Tenth Plan. - HZL is also negotiating with another Australian company Pasminco forgrassroot exploration of Ajmer district in Rajasthan. 70
- HZL has signed MoUs with three foreign companies - BHP Mining and Nuigini Mining (NML) for exploration and exploitation of base andprecious metals in India and BRGM/VMC for gold prospecting in Vietnam. - The Rampura-Agucha mines of Hindustan Zinc Limited (HZL) has beenawarded ISO 9002 certificate for quality management system by SGSYarsley International Certificate Services Limited. 1998
- Crisil has assigned a P1+ rating to the Rs.10-crore short-termdeposit programme of Hindustan Zinc. - The Foreign Investment Promotion Board (FIPB) has approved a jointventure proposal of Australian mining giant BHP and the State ownedHindustan Zinc Ltd (HZL) to mine base metals in Rajasthan. - The power plant is being set up in joint venture with the state-owned Rajasthan State Mines and Minerals Ltd. - Public sector Hindustan Zinc Limited (HZL) will set-up a 100 megawatt (mw) captive power plant in Rajasthan to meet its power requirement for existing mines in the region. 1999
- Rashtriya Chemicals & Fertilisers (RCF) Hindustan Zinc (HZL) andRajasthan State Mines & Minerals (RSMML) have signed a memorandum ofunderstanding for a Rs 300-crore diammonium phosphate (DAP) project inRajasthan.) - Public sector Hindustan Zinc has commenced closure of loss-makingunits as part of its strategy for improving valuation of the companyprior to its privatisation. 2002
-The US$1.3 billion Sterlite Group (Sterlite) announces that it has been declared the successful bidder for the acquisition of a 26% equity stake in Hindustan Zinc Ltd (HZL) for Rs 4450
71
million ($91.30 m) through Sterlite Opportunities and Ventures Ltd a Special Purpose Vehicle set up for the same. -Sterlite Industries India Ltd has informed that US $ 1.3 billion Sterlite Group on April 11 2002 made payment of Rs 4450 million to the Govt. of India and completed the acquisition of 26% stake in Hindustan Zinc Ltd. -Hindustan Zinc Ltd has the following changes in management structure: -Directors ceased Mr B N Mittal Chairman-MD Mr A N Mittal Director Dr Vinayahil Gautam Director Dr S K Gupta Director. -Directors nominated on behalf of strategic partner ie Sterlite opportunities and ventures Ltd w e f April 11 2002. Mr K K Kaura Managing Director Mr Anil Agarwal Additional DirectorMr Navin Agarwal Additional Director Mr Tarun Jain Additional Director Mr C V Krishnan Additional Director Mr C A Sundaram Additional Director. -Govt. Nominee Directors w e f April 11 2002;Dr A K Kundra Chairman Mr A C Wadhawan Director Mr Nand Kishore Shukla Director. - Mr C Sankaran Company Secretary & GM has been nominated as Compliance Officer by the Board. -Govt of India has disinvested 26% of the paid up capital of theHindustan Zinc Ltd ie 109858294 number of shares along with management control in favour of Sterlite Opportunities and Ventures Ltd (SOVL). 2003
-HZL's Zinc Smelter Vishakapatnam is accredited with ISO 9000:2000 certificationfor its quality management system for manufacturing primary zinc cadmium metalsand sulphuric acid through hydro metallurgical process. -Hindustan Zinc Ltd registered a 113.58% growth in its net profit. -HZL a part of Sterile Group has raised $12 million worth of ECBs for its ambitiousCapacity Expansion (Capex) programme.
72
-Hindustan Zinc Ltd has informed that Mr Aditya Narayan has jointed the Sterlite Group and will take responsibility as Managing Director of the Company from Mr K K Kaura CEO Sterlite 2005
-Hindustan Zinc Ltd informes the inauguration of the Company's New Zinc Smelter at Chanderiya in Rajasthan with a production capacity of 170000 Tons Per Annum and 154 MW Captive Power Plant -Hindustan Zinc Ltd has given Greentech Environment Excellence Silver Award for 2004-2005 in metal sector for its environment management 2006
-HZL picks up `Golden Peacock' award 2007
-Hindustan Zinc Ltd has appointed Shri. Sanjiv Kumar Mittal Joint Secretary & Financial Adviser Ministry of Mines as Government Nominee Director on the Board of the Company with immediate effect in place of Shri. Sujit Gulati. - Hindustan Zinc Ltd has informed that the President of India vide letter dated November 28 2007 appointed Shri. A K Singh Director Ministry of Mines as Government Nominee Director on the Board of the Company with immediate effect.
73
BIBLIOGRAPHY Following Sources have been referred in the completion of Summer Training: BOOKS:
1. Khan M Y & Jain P K (2007) , Financial Management, new delhi: tata mcgraw hill. 2. Agarwal N.P. , Indian Corporate Sector. 3. Kothari C.R. , Research Methodology. WEBSITES:
1. www.hzlindia.com 2. www.vedantaresource.com 3. www.google.com NEWSPAPER:
1. Economic Times 2. Times of India MAGAZINES:
1. INDIA TODAY 2. BUSSINESS TODAY 3. ANNUAL REPORT OF HZL(2006-2007)
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