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INDUSTRY PROFILE The tire industry is essentially an automobile ancillary business. The demand for its products emanates from the Original Equipment Manufacturer (OEM), replacement & export market. All these segments are equally important in terms of volume of business. The tire industrys growth is linked to the growth in demand from vehicle manufacturers & the aftermarket. During 2005-06, the growth in production of two or three wheelers & the aftermarket demand were buoyant. Consequently there was a substantial growth in the sales of 2/3 wheelers tires. Input costs especially the price of natural rubber & fabric remained high due to increased demand for tires in passenger car & commercial vehicle segments &also export of natural rubber. The tire industry in India appears to be on the verge of changes due to the ongoing process of globalization. Some foreign companies are making efforts to establish a manufacturing facility in India by setting up joint ventures to cater to local demand as well as for buyback. Indian companies are also stepping up their efforts & working to capture new markets. Regional trade agreements may also have an impaction the industry future performance & development. They tire industry has shown tremendous growth during the year .The 2/3 wheeler industry also witnessed substantial growth in the period under review. There has been a marked shift in consumer preference away from mopeds & scooters & towards motorcycles. The motorcycle tire segment is estimated to grow at 15% per annum. Given the current economic realities, the industry will witness fierce competition between companies of varying size & stature including multinational companies. The tyre industry is essentially an automobile ancillary business. The demand for its products emanates from the original equipment manufactures replacement and export market all these segment are equally important is terms of volume of business. The tyre industries growth is linked to the growth in demand from vehicle manufactures and the after market During 2008-09 the growth in production of 2 and 3 wheeler increased as the market demand were buoyant. Consequently there was a substantial growth in the sales of 2 and 3 wheeler tyres input costs, especially the price of natural rubber and fabric remained high due to increased demand for tyre in passenger car and commercial vehicle segment and also due to export of natural rubber. The tyre industry in India appear to be the verge of changes due to the ongoing process of globalization some foreign companies are marketing efforts to establish a
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manufacturing facility in India by setting up their effort and working to capture new markets regional trade agreement may also have as impact on the industries future performance and development. The tyre industry has shown tremendous growth during the year the 2 and 3 wheeler industry also witnessed substantial growth in the period under review. There has been a market shift in consumer preference away from mopeds and scooter and towards motor cycles. The motor cycle tyre segment is estimate to grow @15% per annum. Stature, including multinational companies. HISTORY OF THE TYRE INDUSTY The word rubber industry had its beginning in the year 1887 with the initiation of process of tuber vulcanization by Charles good year. However the growth of the industry received a big boost towards the end of the century, when the boyd Dunlop succeeded in making the vulcanized rubber into inflatable pneumatic tyres. Since then the tyre industry has constituted a major segment of the industry all over the world. Even in India, automotive tyre and tubers account for a major part of the Indian rubber produce industry. SECTOR COMMENTS; Ever since the first Indian tyre company given the current economic realities, the industry will witness fierce competition between companies of varying size and Dunlop rubber company (India) was incorporated in 1926, the tyre industry has grown rapidly and today it is a Rs 9000 core worth industry. India has 2.61lakh people living in villages and are connected by 6.23 lakh kms of metal led roads and 9.81lkh kms of un metalled roads. These villages are linked to small town and cities. There is a daily traffic of over 4.12 lakhs trucks, 1.27 lakh busses, 7.23 lakh car and thousands of taxis, 2 wheeler, 3 wheeler, tractors and animal drawn vehicle on Indian roads. There exists a market potential for the tyre industry in India. The fortune of the tyre industry depends on the agriculture and industrial performance as it influences economy, the transportation needs and the production of vehicles. Hence, this is a very sensitive industry, which has to adopt itself to a highly volatile environment. MARKET PROFILE; While the tyre industry is mainly dominated by the organized sector , the unorganized sector holds sway in bicycle tyres. The major players in the organized tyre segment consist of
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MRF , APPOLO TYRE , CEAT and JK TYRE ltd industries , which account for 63% of the organized tyre market. The other key players includes modi rubber, kesoram industries and good year India, with 11per cent , 7%and 6% share respectively . Dunlop, falcon tyres corporation of India ltd(TCIL), TVS srichakra, metro tyre and balkrishna tyre are some of the other players in the industry. MRF , the largest tyre manufacture in the country, has strong brand equity ,while it rules supreme in the industry. Other players have created niche markets of their own. SECTOR SPECIFICS; The tyre industry is a major consumer of the domestic rubber production, natural rubber constitutes 80 per cent of the material content in India tyre synthetic rubber constitute only 20 per cent of the rubber content of a tyre in India. Worldwide, the ratio of natural rubber to synthetic rubber is 30; 70. Apart from natural and synthetic rubber, rubber chemicals are also widely used in tyres. Most of the RSS-4 grade rubber required by the Indian tyre industry is domestically sourced, with only a marginal amount being imported. This is an advantage for the industry, since natural rubber constitutes 25% of the total raw material cost of the tyre. OUTLOOK; Globally, the OEM segment constitutes only 30%of the tyre market, exports 10% and the balance from the replacement market. In India, the scenario is quite different .Nearly 85% of the total tyre demand in the country is for replacement. This anomaly has placed the retenders in a better position then the tyre manufactures .rethreading is looming over the tyre industry has a colossal threat. The Coimbatore based elgi tyres and tread ltd., the largest rethreads in India. Simply put, rethreading is replacing the worn-out tread of the old tyre with a new one. The popularity of rethreading stems from the fact that is costs only 20% of a new tyre but increases its life by 70% to 80%. Most of the transports in India thread their tyre twice during its lifetime, will a few fleet owners even retread thrice. In their zealousness to economize costs, they over look the reality that retreading the quality of the tyre.

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The Major Raw Material & their weight age in the total raw material structure are: 1. Natural Rubber 2. Synthetic Rubber 3. Carbon Black 4. Nylon Tire Cord/yarn 5. Share of Raw Material 25% 14% 13% 34% 14%

Remaining share of raw materials of 14% approx. is accounted by rubber chemicals.

1. NATURAL RUBBER It is the most important raw material used in the manufacture of tires. Natural rubber accounts for about 40% (by weight) of the total raw material requirement in the manufacture

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of a tire. The productivity of natural rubber in India is highest in the world but still India face shortage of natural rubber produced in the country. 2. SYNTHETIC BUTADIENCE RUBBER It is one of the major kinds of raw materials. It contains three types of rubber namely: styrene rubber, Poly Butadiene rubber & Butyl Rubber. 3. CARBON BLACK It is petroleum based unorganized chemical in the form of quasi-graphite powder of extreme fitness & with high surface area composed essentially of elemental carbon. The main input required in the manufacturing of carbon black is feedstock. Carbon black is divided into soft grade & hard grade. In India carbon black used is of N660, N220, & N330 variety.

4. NYLON YARN/FABRIC/TIRE CORD Nylon tire cords are an essential reinforcement material weigh- age Nylon tire materials used in the manufacture of Nylon tire cord. To sum up the tire industry is highly raw material intensive with raw material accounting for 70% of the cost of production. The export-import policy allows free import of all tires of new tires & tubes. However, import of retreated tires either for use or for reclamation of rubber is restricted. This has led to use tires being smuggled into the country under the label of new tires. Though tire imports & all raw materials for tires except natural rubber are under Open General Licenses (OGL) only import of natural rubber from Srilanka is eligible under OGL. The profitability of the industry has high correlation with the price of key raw materials such as rubber & crude oil. They account for more than 70% of the total cost. The tire industry is also capital intensive industry as it requires around Rs. 4 billion to set up a radial tire plant(tire having fabric layers parallel) & around 1.5 to 2 billion for a cross poly tires. Functions Of The Tire: yarn

in term of cost of raw materials used in the highest at about 27%. Caprolactum is a major raw

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Tire provides steering response. Durable & easy to drive. Has load carrying capacity. Provides cushioning ability. Cooler running & gives more mileage. Having a minimum noise & vibration. Passengers safety.

Features of the Tires: 1. The tires have a stylish look. 2. The tires are made up of a unique thread design which provides unbeaten balance coupled with low rolling resistance of gripping. 3. The performance level of tires is high. 4. The tires are durable. 5. Tires are specially created of unit directional patterns for optimum performance. 6. Tires give smooth driving comfort. 7. Product variety two, three & four wheelers.

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COMPANY PROFILE Company history Mr. H.D Shetty & a group of professionals promoted FALCON TYRES LIMITED(FTL) in 1973 & it started commercial production in 1975.Then it was taken over by JUMBO group in 1987 headed by Mr. M.R.Chhabria, NRI business tycoon in December 2005 organization was taken over by P.K.RUIA group. Dunlop has a 47% stake in Falcon Tires however the company functions independently. Company engages in the business of manufacturing of a wide range of Nylon bias play tires & buty1 tubes for two & three wheelers passengers cars, jeep, light commercial vehicles under DUNLOP brand for the domestic market & FALCON brand for the overseas market. It is location in the garden city Mysore, situated in Metagalli industrial area of Karnataka industrial development board Mysore in 18 acres land area. Falcon is a company registered under companies Act & under license from Dunlop India limited to manufacture tires & tubes using state of the art technology. Falcons Mysore factory manufactures 5400000 tires & 3600000 buty1 tubes per year. Falcon tires is the preferred choice of all leading vehicle manufactures in India like Bajaj Auto

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Yamaha Motors Escorts Hero Honda motors Majestic Auto LML Kinetic motors company Kinetic Engineering Royal Enfield motors

Falcon tires limited global operations include exporting tires to Bangladesh, Srilanka, Peru Nepal, European countries etc. Falcon has acquired modern & sophisticated technology for producing quality tires & tubes. It has imported high speed machines from Korea, Taiwan &United Kingdom etc. Close interaction with the customers has familiarized with their needs & has therefore helped the company to create quality products such as the JAP series & latest M & Z series of tires. This move has enabled the company to gain a major chunk of the market in the two & three wheeler segment. Falcon is the first & largest company in India to supply high speed, high performance Low Aspect Ratio directional bias tires advanced & high powered new generation motorcycles being introduced successfully on the Indian roads. Falcon tire meets international organization for standardization bureau of India standard wherever applicable Falcons R & D center is engaged upgrading the product performance, quality &introduction of new products Falcons aim is to satisfaction to its customers by offering high & cost effective tires & tubes. OBJECTIVES OF THE COMPANY Supply of the quality products. On time delivery.
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Achieve fullest customer satisfaction. Training to all levels. Continual improvements. MAJOR CUSTOMERS OF FALCON TYRES a) Bajaj Auto Ltd. Akrudi, Pune b) Bajaj Tempo Ltd. Akrudi, Pune c) Bajaj Auto Ltd. Walaj, Aurangabad. d) Hero Honda Motors, Chennai. e) LML Ltd. Kanpur. f) Yamaha Motors India Ltd. Faridabad. g) Kinetic Engineering Ltd. Pune. h) Piaggio Greaves Ltd. Bharamati. i) VST Tillers & tractors Ltd. Bangalore.

BACKGROUND & INCEPTION OF THE COMPANY Milestone of Falcon tires 1974: FTL was promoted by a group of professionals. 1975: FTL started its commercial production. 1983: Company started with its loss. 1987: The Company was taken over by Mr. Chabria & it becomes a part of jumbo group of industries.
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1991-92: FTL started recording profit. 1994: The entire accumulated losses of the company were wiped off & it carried out the one of the most remarkable turnover in the Indian corporation history. 1994-95: Capacity expansion from 2.2 lakh to 3.0 lakh. 1995-96: It emerged as the highest profitable company in the Indian tire industry with a net profit ratio of over 7%. 1997-01: One stage capacity expansion to 3.5 lakhs till date. 2001-02: Company earns profits of 353.06. 2005-06: Company is taken over by P.K RUIA Group. 2006-07: Company started, cogen 6mw power project. NATURE OF THE BUSINESS Falcon company is engaged in manufacturing business, it provides tires, tubes, flap, radical tires & tubeless tires with licensed capacity of automotive tires of 5400000 & automotive tubes of 3600000 per year. Company enjoys 20% of market shares globally. The companies into globalization, it exports products to the developing countries like East Asian countries. It has several regular customers like Bajaj auto, Yamaha motors, Hero Honda. The company suppliers to all major Original Equipment Manufacturers (OEM) directly from the factory. The replacement market is catered through the C & F agents established all over the country. The export market is directly handled from the factory at Mysore. The companys brand Dunlop has enabled the company to with stand the sever vet throat competition from the other tire companies to a great extent. FTL is engaged in manufacturing & marketing of automotive tires, tubes flaps, the products are as follows: o Tires of autos o Tires of motor cycles, scooters, jeeps. o Tires for tractors.

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o Automotive inner tubes for all the above tires.

AREA OF OPERATION Falcon manufactures & markets Nylon bias poly tires & buty1 tubes for two & three wheeler passengers cars & jeeps light commercial vehicles under the Dunlop brand the domestic & Falcon brand for the overseas market. FTL in the year 1987 company has taken over by DUNLOP INDIA LIMITED. Even though it is subsidiary of India Ltd. It is a separate entity & profits enter by it being a subsidiary of Dunlop. Falcon has the stable assistance of the SUITOMO industries of Japan. The company supplies products to the Original Equipment Manufacturers (OEM) & replacement throughout the nation & exports products to the developing countries like South East Asia & Latin America. Therefore it operates globally, nationally & regionally. VISSION, MISSION AND QUALITY POLICY VISSION STATEMENT The company believes in the philosophy of continuous improvement in all facts of its operation & to have leadership status in two & three wheeler segment. To set global benchmark in each segment of our operation & in the process delight all our customers, employees & stakeholders. MISSION STATEMENT The Falcon Tyres Ltd. Will always strive to be a socially responsible corporate citizen, dedicated to providing value for money to its customers through the operational excellence of its process, partners & employees where the focus is on continuous improvement of the quality of all its products & processes. To focus on 2 & 3 wheeler business along with capacity expansion of existing capacity To mark Falcon Tyres available all across India. Improvement in costumer relations & production quality.
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QUALITY POLICY Falcon Tyres Ltd. committed to supply quality tyres, tubes & flaps on time to achieve fullest customer satisfaction. EOHS POLICY Falcon Tyres Ltd. manufacturing tyres, tubes & flaps are committed to develop environmental friendly healthy & safe working systems. We shall achieve this by: 1. Use of proper & efficient methods in our operations with the aim of conservation of natural resources, prevention of pollution & hazards. 2. Compliance with applicable legislations & regulations. Training at all levels & continually improving environmental, occupational, health & safety performance. PRODUCT PROFILE Falcon Tyres Ltd. Manufacture & market a wide range of Nylon bias poly tyres & butyl tubes for two & three wheelers, passenger cars, light commercial vehicles & farm vehicles. FTL markets its products under DUNLOP brand for the domestic market & FALCON brand for the overseas market. DUNLOP- MAGIC/MYSTRY/ ZEBRA-Vehicles in which they are used; Hunk, Eliminator, Splendor plus, Enticer, Ambition, Karizma, CBZ, Dawn, CD dawn, Libero crux, CD-10008 pulsars, Caliber 115, Boer, velocity, Boss, Freedom, Victor, Fiero, Wind, RX-100. DUNLOP-GLINDER & STEEL vehicles in which these kinds of enriched tyres are used: Cheek safari, DX Zoom, Nova, Marvel, Legend, Active Honda & dieo. DUNLOP CMALLING-Vehicles in which these kinds of tyres are used: Appachi, Passion plus, R-15, Ambition, Dawn, Libero, CRUX, CRUX-R victor, pulsar, caliber-115, Boxer, Kinetic velocity, Freedom, Boss, Fiero, RX-125. DIFFERENT TYPE OF TYRES AUTO RICKSHAW MOTOR CYCLE SCOOTER

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Jap 700 Auto star Kargil Lug Leader Superstar Megastar Super tuff Maxi rib jap 320 Maxi rib jap 330 Maxi rib jap 360 Uni grip gold Uni grip speed Hero Magic Master Smart Challenger Mystery specter Maxi life Jap 220 Glider Kiraro jap 230 Maxi life jap 200 K137

CAR PC 523 Super tuff Olympus Olympus ULT

JEEP AND LCV Road track Rod track major Road star plus Border XM rib extra

TRACTOR Front jap 910 Front Mahan Mahan LR5 Power tills Reaper jap 940 Rear jap 930 Trailer RK 59

OWNERSHIP PATTERN Falcon Tyres Company is private limited company 91.06% of shares of the company are in the electronic from share holding pattern as on 30th September 2011. PARTICULARS NO. OF SHARES HELD % OF SHARE HOLDING

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A. Promoters holding 1.Promoters Indian promoters 5947644 17.45 68.98 ---86.43 Foreign promoters 23513100 2.Persons acting in ---concert Subtotal B.Non- promoters holding. 3. Institutional investors a. Mutual fund & UTI b.Bank, FIs, Insurance companies. c. FIIs Subtotal 3.Others a)private corporate bodies b)Indian public c)NRIs/OCBs d)Any other Subtotal 2564568 2032590 11922 15708 4624788 7.50 5.97 0.03 0.05 13.57 ------------------------29460744

GRAND TOTAL

34085532

100.00

COMPETATORS INFORMATION MADRAS RUBBER FACTORY (MRF) A leading company in the tyre industry MRF Ltd. Boasts of an enviable track record. The company has continued in the same vein & has been posting excellent results, notwithstanding the winds of recession blowing across the economy performance of the
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company has been commendable in light of the fact that the user industry is facing a slow down. The company has benefited from better productivity & operational efficiency. The company caters to a host of impressive clients. CEAT Being the second largest selling brand in India with a market share of 14.6% CEAT caters primarily to the replacement market. Due to the strong growth in the OEM sector the share of the replacement market in the total revenue of the company has fallen. However, the production growth in the automobile sector. Over the past few years should provide a boost to the replacement market in the coming years & CEAT could be major beneficiary thereof with the advent of multinationals like Goodyear, Michelin Bridgestone & Continental, a major shakeout in the industry is imminent & the same could result in CEAT. APPLLO TYRES LIMITED (ATL) A slowdown in the tyre market & rubber procurement at high prices has put the brakes on Apollo Tyres Ltd. (ATL). The company has traditionally has been the market leader in the truck & bus tyres segments.

INFRASTRUCTURAL FACILITIES 1. It has 18 acres of land. 2. Canteen facilities. 3. Medical & health care facilities.
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4. Safety department. 5. Each & every department should be clean. 6. Air conditioning & ventilation system. 7. Meeting rooms. 8. Leave facilities. 9. Shoes & uniform for workers. 10. Co-generation power plant. 11. Raw water storage tanks. 12. Water facilities.

I.ACHIEVEMENT/AWARDS Central Excise has termed FTL as good payer Sales Tax Department & the Electricity Board have giving GORDCARD to FTL> The PF Department has termed FTL as BEST ENTERPRISE.

OTHER AWARDS ISO 9001:2000 certificate in March 2003. ISO/TS 16949:2002 certificate in April 2004. ISO 40001; 2004 certificate in September 2005. OHSAS 18001:1999 certificate in October 2005.

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WORK FLOW MODEL OF FTL

Receipt of stock
Final mixing

WORK AWAY COMPOUND (20X)

Receipt of chemical
Testing

R A W M A T E R I A L S T O R E
Inspection SCRAP [Type text] Page 17 Precutting WORK AWAY

Blue patches chalk power & Blue/white paint

Extrusion

WORK AWAY

AGEING

Tube joint paint

Splicing

WORK AWAY

Valve, paint

valve

base

Valve Fixing Chilling Performing Curing

WORK AWAY WORK AWAY WORK AWAY

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Core, Nut, washer & packing bags
CORE FIXING

Finished Goods

Work flow model gives the detailed tyres manufacturing process & also tube manufacturing process. It is systematic process which is explained in detail as follows: TUBE MANUFACTURING PROCESS & PROCESS SPECIFICATION RAW MATERIALS BUTYL Butyl rubber a copolymer of isobutylene & isoprene is used in the manufacture of automotive tubes because of its low permeability of gases. EPDM It is a copolymer of ethylene & propylene which posses very good resistance to ageing & also low cost since it is used butyl for manufacturing of tubes. CARBON BLACK Carbon black used in rubber compounds to provide increased strength & produced by burning crude oil in a special type of furnace. OIL Paraffin/Aromatic/Naphthenic oils are used as an extender ZINC OXIDE Used as an activator in butyl rubber compound. STEARIC ACID Stearic acid in combination with acid & acts as a activator & also act as an internal lubricant. RECCLAIM RUBBER Butyl reclaim is a processing aid.
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CURATIVES Sulphur act as a Vulcanizing agent. ACCELEATORS Trim ethyl tetra mine & mercapto benzyl thiozole. MASTER BATCH MIXING Master batch mixing of butyl rubber inner tube compound is carried out in an internal mixer but finalization (addition of curatives) may be carried out in open mill or internal mixer. The objective of master batch mixing is to disperse the carbon black in the butyl with the minimum of macro agglomerates & stock porosity. It has offended been considered that carbon black addition in a conventional butyl mixing cycle should quite early as the polymer does not undergo palpitation during mixing. However, a degree of mastication of the butyl rubber converts the initially formed sumps into a continuous mass which more readily accepts black typically the first black addition is made after one minute of rubber mastication. Zinc oxide &/or stearic acid should not be added with the polymer initially as they coat it, reducing shear & adversely affecting mix quality. Zinc oxide is preferably added with the first black & stearic acid with the subsequent black oil addition. Process oils should not be added with the first black as they reduce viscostitu & shear. They should be added with the last black addition. Dump temperature of 155-165 degree C are indicated for optimum mix temperature is mandatory to ensure complete chemical reaction. Dump temperatures must exceed 125 degree cent. To ensure dispersion of polyethylene butyl bale wrap. STRAINING Straining is process of eliminating foreign matter from the compound as the wall thickness of the tube is very tolerating the same. Butyl inner tube compounds are strained to remove foreign matter black agglomerates, etc. efficient cooling & minimal heat history are prerequisites for straining finalized compounds preferably should go directly to the

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Extruder are sometimes practiced. The compound must be particularly well-mixed & high quality curatives used to avoid frequent screen changing. Staining is carried out after master batch mixing. STRANED EXTRUDER Mesh size Strained rubber compound temperature Extruder screw RPM FINAL MIXING Curatives may be added to butyl inner tube compounds on the open mill before finalizing. It is desirable to rest the master batch for a minimum of 2 hours preferably overnight to allow cooling & some equilibration. This allows maximum rubber carbon black interaction, which improves green strength. CURATIVES TMT, MBT are accelerators & sulphur act as vulcanizing agent. Final mixing is carried out in two ways: 1. Understand master batch mixing. 2. Strained master batch mixing. EXTRUSION Hot feed extrusion is the most widely practiced technique. A tube of uniform of dimensions with minimum porosity is the objectives. In hot feed extrusion, particular an adequate supply of compound strip with minimum porosity & at the correct temperature. A small rolling bank should be maintained on the feed mill should not be over loaded a slight excess of stock is desirable in the extruder feed box to make sure that the screw flight are full, thus preventing an excessive intake of air with the feed. Feed sped temperature of 110 to 120 dg. Cent. Give efficient extrusion. The take off conveyor sped should match the extrusion speed & pulling down should avoided as it results
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in increased tube wall porosity & uneven shrinkage on cooling. The crown which under goes thinning in the forming operation is usually extruded 1.5- 1.6 times the thickness of the base. Talc or other dusting is blow into the interior of the tube during extrusion to prevent the collapsed tube sticking to itself. The application of blue fine compound to the butyl tube during extrusion is useful it identifies tube as butyl to re-clainers. A light thin line only should apply so that it is dry before entering the cooling batch. Butyl inner tubes should be well cooled after extrusion by passing through a cold water spray. It is particularly essential that the folds are well cooled, warm folds are particularly susceptible to fold breakdown. All water should be blown off the surface of the tubes after leaving the cooling section. A polyethylene patch is applied to the hot tube in the area where the value will be placed. The polyethylene should be plain & un-patterned. The tube is then dusted or dip coated externally with talc. Tubes are then cut to length & usually passed to storage in the bear trap racks. If possible the green tubes should not stacked, as this can result in fold break down. The tubes are preferably stored for the duration of 2 hours which will ensure a good condition for splicing. GREEN TUBE STORAGE AFTER EXTRUSION SHOULD NOT MORE THAN 4 HOURS. VALVING Butyl inner tubes should be fitted with butyl rubber values valving before splicing allows the tubes to be spliced crown down if required; the valve hole can be punched before valve fixing. Valve hole punching is carried out using specified templates. Valve cement is made from the inner tube compound with added tacakifier resin. The valve cement is applied to the base of the valve pad. A single thin coat of well compounded cement is adequate sufficient drying time to allow all solvent to escape from the adhesive is required. Butyl inner tube valves should be consolidated using specified valve consolidation die; the valve consolidation time varies from 6.0 sec. to 8.0 sec. depending on the tubes sizes.
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Oven temperature Drying time (Minutes) SPLICING Splicing is a fundamentally important step in Butyl inner tube production & must be performed as efficiently as possible, since splice faults often form large proportion of total rejects. Butyl tubes are spliced by automated butt splicing machines the ends of the inner tubes to be joined are cut to length by a hot knife & the fresh tacky surfaces are butted together & consolidated. Optimum butt splice quality to be obtained with a horizontal cut & rubber faced clamps. SAFETY FEATURES 1. Twin starter buttons requiring two-handed operation. 2. Clamps lift if starter buttons released before they have completely desended. 3. Kick bar immediately lifts clamps & stops knife according to which part of cycle is in progress. 4. Guarded clamp covers table opening on machines. STORAGE After splicing, green tube should be carefully stored on racks, storage time should not be longer than 24 hours & the storage environment should reasonably clean & cool. SPLICE CHILLING Chilling of the butt splice Butyl tube to increase its green strength & minimize splice opening during the subsequent operation is required. The most common method of chilling is by laying the splice section over a pipe through which cooled bring circulating splice should not be over chilled & the chilled time being usually equivalent to the duration of the cure cycle. Care should be taken to ensure that no moisture remains on the tube when it is placed in the press, the presence of moisture may cause defects. FORMING
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Forming is the operation in which the uncured tube is inflated to about 97% to 98% of its final cured volume before placing it in the prese. Forming Rings should be designed to minimize any expansion of the base of the tube, concentrating it on the thickened crown section. Tubes should be slowly inflated. It is advisable to use a guide to control the degree of inflation. Over formed tubes are susceptible to thinning & may crease in the mould. Forming rings should not be located very close to presses as the heat from the press may cause splice opening or thinning. VULCANIZATION Inner tubes are vulcanized in quite simple press often with a hot black to increase the temperature in the thicker valve region. Inner tubes area inflated internally with compressed air. Normally, Butyl inner tubes curing temperatures are 190-200 deg. Cent. And curing time will of course vary with size & thickness. Mould surfaces should smooth & clean both from the stand point of the appearance of finished tubes & ease with which the stock flows in the mould. Dirty moulds can lead to poor stock flow & buckles. Moulds to be cleaned with diesel or alkali (5%) in water. Moulds should be well vented & the vents kept clear to prevent dimpling. Internal air pressure External temperature (Curing temperature) INSPECTION After vulcanization the tubes should inspected carefully for flaws that might offect serviceability using a combination of visual & manual techniques particular attention should be given to the splice & the valve region, The most common sources of defective tubes. The tubes next are usually vacuum evacuated, folded & packaged for storage & shipments. A good practice is to package the tubes in sealed polyethylene bags, which will help prevent ozone attack during long storage. RECYCLING OF COMPONDS : 7.0+/-0.5 kgs : 195-205 deg, cent

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In the manufacture of butyl inner tubes a certain amount of uncured stick, which must be record have been damaged during storage. If there is no scorched material or other foreign matter in the rubber, this material can be used at up to 10% to 20 % during final mixing. It should be at uniform rate on the final mix mill or warm-up mill but it should be remembered that recycle reduces the scorch safety of new compound. Material for recycle must be free from water & extraneous materials such as valve patch & valves. Thus care must be taken to excluded water at all possible pints of entry. Watch together with dusting agents & polyethylene patches, can be a potent source of blisters & porosity in cured inner tubes. FUTURE GROWTH & PROSPECTS To develop wide range of tyres and tubes in two, three and four wheeler and industrial segments for export market.

To develop tubeless tyres in two wheeler segments.

To further introduce advanced technology tyres of directional pattern design and conventional pattern in motorcycle segment.

To further develop hi-tech low profile tyres in scooter

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MCKENCYS 7S FRAME WORK:

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The 7-S model is better known as McKenzie 7-S. This was developed by tom peters and Robert waterman who had been consultants at the firm McKenzie. They published their 7-S model in their article Structure is not organization (1980) and in their books The art of Japanese management (1981) and In search of excellence (1982). Just as the 7 wonders of the world serve as the mirror to worlds beauty, so do these 7 elements constitute the entire company as a whole. The mode consists of 7 elements. Those 7 elements are distinguished in so called hard Ss and soft Ss. The hard elements are feasible and easy to identify. They are strategy, structure and system of the organization. The four soft Ss are hardly feasible. They are highly determined by the people at work in the organization i.e., style, staff, skills and shared values. STRATERGY A company plans in response to or anticipate changes in the external environment. Strategy sets out vision, mission, objectives, major action plans and policies of the entire enterprise. These set out the picture of the organization in the future. In a typical pattern, it spells out the overall organization strategy. The main strategy of FTL is provided wide range of products at superior quality to the customers. In order to achieve this, company has expanded the existing manufacturing capacity and facilities. It is also aiming at product diversification. So, new pattern of tyres and tubes have been introduced.

STRUCTURE FTL has both horizontal and vertical organization structure. Where there are different departments and under these departments there are sub managers according to their preferred jobs.FTL is an independent an organized structure in itself. The lower level and functional level managers are consulted and consultation is analyzed before the top management any decisions.

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ORGANIZATION STRUCTURE: Managing Director

Vice President

Sr. General Manager

General Manager

Sr. Deputy General Manager

Deputy General Manager

Assistant General Manager

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Sr. Manager

Manager

Officer

Board of directors in FTL Mr. Pawan Kumar Ruia, Chairman Mr. S.Ravi, Director Mr.Ambuj Kumar Jain, Director Mr. Kokkarne Natarajan Prithviraj, Director Mr. Prakash P Mallya, Director Mr. S Badrinarayanan, Director Mr. Ashok Agarwal, Director Mr. Ashok Guptta, Whole Time Director Mr. Sunil Bhansali, Executive Director

Functional department of DPPL industry There are the functional at DPPL Finance Human resource management
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Marketing Production department includes engineering, technical, quality assurance material and production planning related actively. SYSTEM System on 7S frame works refers to the rules, regulations and procedures; both formal and informal rules complement the organization system, production planning, control system and budgeting system. The FTL uses a complete systematized process in all areas of its operations. The company has different organized methods in order to smooth flow of the information from one department to another. Dunlop has good internal control system. Information system & IT used in the FTL Budgets are made in order to find sales forecast by Marketing Department. Budgets are properly planned to make purchase at reasonable time and price by Financial Department. HR systems HR Department aims at providing training and development. STYLE Tangible evidence of what management considers important by the way it collectively spends time and attention and uses symbolic behavior. If it is not what management says is important, it is the way management behaves. In FTL there exists a highly participative style of management. The employees are given full important. Even workers are allowed to express their views freely by suggestions; schemes and best suggestion is awarded. The workers are educated about their rights. The company values the opinion of workers, believes in Total acceptance rather than acceptance by the management or the workers. The opinions of both management and workers are taken into consideration. STAFF

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Staff of the company has hired able people, trained them well and assigned them to the right jobs. Employees are the functional unit of the organization. Their selection, training, placement and induction everything is important for the organization. The company deals with the process by which employees are recruited, deployed and develop their current position, future up-gradation are doing, selection, training, rewards, recognition, retention, motivation and assignment to appropriate work are considering. FTL there are various departments under which employees work, they are very dedicated towards work. The employees are specialized in their respective field of work. There are many welfare schemes in company in order to encourage the workers. As such they are very active and learning oriented. The employees demographics are as under:Total employees- 575 Company staffs- 65 Company employees-110 Trainees-85 Contractees-315

SKILL A skill is the ability, knowledge, understanding and judgment to accomplish a task. Skills may be defined as what the company does best; the distinctive capabilities and competencies that reside in the organization. The job requirements, type of job and important of job gives rise to different skills in the different jobs and different departments of the company. The skills differ with respect to performance of the job for instance- in quality control they need an engineer and in HR.Department they require post graduate with specialization in HRM. The manpower at FTL a huge and capable. The workers are very skilled so the company is capable of accepting and performing any type of the orders and executing it will
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before schedule and to the expecting of the customers. The employees are well-versed skills on their particular job performance. The training is provided for the employees where employees will get to learn all innovative things about the process. Technical skill. Human skill. Training.

SHARED VALUE It refers to the core of fundamental values that are widely shared in the organization and serve as guiding principles that are important. The values and believes of the company ultimately guide employees to-wards valued behavior. The values might well include simple goal statements in determining corporate destiny. To fit the concept, most people in the organization must share the values. FTL believes in the philosophy of continuous improvement in all the aspects of its operations. The organization has the common goals of having production of 500 crores in next 3years. The company considers employees are the greatest of its assets. Production and productivity comes only to employee welfare FTL believes that productivity comes only next to employee welfare. The companys focus on the customer and creating culture of interdependence are embodied in its mission statement. SWOT ANALYSIS

STRENGH

OPPERTUNITIES

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WEAKNESS

THREADS

Strategic

management

is

concerned

with establishing

proper

organization

environment fit. It involves watching the organization factors with the environment factor. Strategic management therefore, involves analysis of the organization factors. SWOT means analysis and assessment of comparative strengths and weakness of a firm in relation with their competitors and environment opportunities and threats, which a company may likely to face SWOT analysis is as such a systematic study and identification on of those aspects and strategies that best suit the individual company position in a given situation . it should be based on logic and rational thinking such that a proper strategy improves an organization business strengths and opportunities and at the same time reduce its weakness and threats . The SWOT analysis of FTL is given below;

STRENGTHS; Brand equity of DUNLOP Necessary infrastructures and additional capacities created to cuter to the marketing requirement. The company has increase its presence in all the markets viz, original equipment replacement exports. Consistent quality and after sales service with full fledged R&D backup.
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Flexibility in production. Excellent manpower. 95%capacity utilization. 30%shre in the replacement market. Obtained ISO certificate for the good quality of the production. Successful and fast absorption of international technology to suit Indians and needs.

WEAKNESS; Dependence on original equipment customers. Loss of flexibility in pricing of the products due to severe cultroat computation. Non-participation in OEM,S like TVS , Honda companies. Very less expenditure on R&D. Less range of tyre in 4 wheelers. Out dated labour laws. motors, etc and fast growing

OPPORTUNITIES; Projected growth trajectory of the automobile industry, indicating increase in the OEM demand. Rise in replacement market demand. Extensive distribution network to cater to the requirements of the replacement market.

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Increased business from existing and new clients including exports markets for two/ three wheeler tyres. THREATS; cheaper imports of tyre, especially from china Cyclical nature of the automobile industry. Volatility in the prices of rubber, synthetic rubber, carbon black and other petroleum based raw materials, which accounts for nearly 90% of the total raw material consumed.

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ANALYSIS OF FINANCIAL STATEMENT BALANCESHEET AS AT 30th September, 2012

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PARTICULARS 1.EQITY AND LIABILITIES (1) Shareholders funds a. Share Capital b. Reserves & surplus c. Money Received against share warrants (2) Share Application Money Pending Allotment (3) Non-current Liabilities a. Long-Term borrowing b. Deferred Tax Liabilities (Net) c. Other Long Term Liabilities d. Long Term Provisions (4) Current Liabilities a. Short-Term Borrowing b. Trade Payables c. Other Current Liabilities d. Short Term Provisions Total Equity & Liabilities II. ASSETS (1)Non-Current Assets a. Fixed Assets i. Tangible Assets ii. Intangible Assets iii. Capital Work-in-progress b. Non-current Investments c. Long Term Loans & Advances (2) Current Assets a. Inventions b. Trade Receivables c. Cash & Bank Balance d. Short-Term Loans & Advances 3 3A 3B 3C 3D 4 4A 4B 4C 4D NOTE 2012 2013

1 2

3873.63 23540.76 _ 27414.39 _ 47437.49 1483.07 3746.48 1057.99

1704.27 17972.74 _ 19677.01 _ 19726.77 763.50 2606.45 1186.92

12282.99 11687.42 7013.65 1095.98 113219.45

23313.82 7970.45 5945.29 3441.73 84631.94

6 48043.19 20.15 16109.28 1107.52 23930.35 9536.46 6851.71 2448.85 5171.94 19497.00 _ 4372.13 8863.00 23698.29 9139.97 11383.37 2779.96 4898.22

7 8 9 10 11 12

113219.45 Total Assets

84631.94

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STATEMENT OF PROFIT & LOSS FOR THE YEAR ENDED ON 30 th SEPTEMBER, 2012 PARTICULARS Revenue from operations Other Income Total Revenue Expenses Cost of materials consumed Manufacturing Expenses Purchase of Stock-in-trade Charges in inventories of finished goods, Work-in-progress & stock-in-trade Employee Benefit Expense Financial Costs Depreciation & Amortization Expenses Other Expenses Total Expenses 21 Profit before exceptional & extraordinary items & tax Exceptional Items Profit before extraordinary items & tax Extraordinary Items Profit before tax Tax expense: (1) Current tax (2) Deferred tax Profit/Loss from the period from continuing operations Profit(Loss) from the discontinuing operations Tax expense of discontinuing operations Profit/Loss from the discontinuing operations Profit/Loss for the period Earning per equity share: (1) Basic (2) Diluted 15 15A 16 17 18 19 20 NOTE 2011 13 14 90595.66 951.39 91547.05 53292.05 4981.15 9738.17 436.76 5422.04 4172.01 1805.52 10180.99 90028.69 1518.36 6697.28 -5178.92 _ -5178.92 _ 719.57 -5898.49 _ _ _ -5898.49 -7.61 7.61 2012 90072.77 828.44 90901.21 53756.95 5441.29 11539.59 -2585.56 4928.50 1752.03 852.33 10261.51 85946.64 4954.57 _ 4954.57 _ 4954.57 2019.56 36.55 2898.46 _ _ _ 2898.46 8.50 8.50

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LEARING EXPERIENCE Internship at Falcon Tyres Ltd. was a rewarding experience. During in plant training period I have learnt the organization basics. And 10weeks of experience at FTL has taught the important of soft skill for a management student. The most significant lessons, which have learnt from the organization, employees are the most valuable assets of the organization and it is very important to keep them satisfied. Being in the organization for four weeks, I have learnt the following disciplines: o Managerial knowledge such as planning, organizing, directing, controlling and decision making. o Got the product knowledge at Falcon types. o The company has given high priority for quality and also customer satisfaction. o More care was taken by the top managers towards workers regarding their health and safety. o No outsiders are allowed into the company without permission letter and security people take due care of this, which indicates the important given by the company towards security of employees, organization and secrecy. o All infrastructural facilities and safety measures are provided to the workers at work place to avoid accidents. o The company follows an internal recruitment process through promotions on the basis of this promotes employee satisfaction lot.

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GENERAL INTRODUCTION Capital structure refers to a business's balance of debt and equity financing. Businesses have two options for financing the purchases of equipment, expenses and materials necessary for their operations. They can raise money from investors, which is equity financing, or they can borrow from banks and creditors -- leverage or debt financing. Most businesses engage in a degree of both, paying careful attention to the costs associated with either source. Relying too heavily on equity increases the cost to investors and cuts into return. But relying too much on debt puts the business in a more precarious position and comes with the substantial costs of interest. Capital structure means the mixture of share capital and other long term liabilities. In the company, we know that liability of each shareholder is limited but how much be the total liability of shareholder is the important question? It can be decided by choosing best capital structure. In capital structure, we include equity share capital, preference share capital, debenture and long term debt. Suppose, our companys capital structure may show 50% equity share capital, 30% preference shares capital and 20% of debentures. But all companys capital structure may not be equal because different business needs different type of capital. Some of companies want to become smart. They slowly decrease equity share capital and increase loan excessively which may be very risky because these company has to pay fixed cost of interest and has to manage repayment of loan after some time. In order to run & manage a company in an efficient manner Funds are needed from the initial stage that promotional stage to the end .Finance plays a very important role in companys life .This is because, if the funds are insufficient the business suffers .But, if the funds are not properly managed the entire organization suffers .Therefore, it is very essential to estimate correctly the current & future need of capital. By doing this, an organization can have an optimum capital structure which intern helps the organization to conduct its activities smoothly without any stress. STATEMENT OF PROBLEM Capital structure decision is not an easy task. The choice of firms Capital structure is a marketing problem. The capital structure affects the companys EPS, EBIT, and financing trend so the study of capital structure is necessary. The optimum financing affect the companys performance or not.
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Capital structure refers to the way corporation finance its assets through some combination of equity debt. Capital structure planning here by it focuses on the idea firms only planning their capital. This analysis can be extended to look weather there is impact an optimal capital structure the one which maximizes the value of the firm. The company is facing the problem of improper of capital structure, debt acquires the major part in capital structure it increase the companys cost of debt. SCOPE OF THE STUDY To study of the capital structure involving an examination of long term as well as short term sources that a company taps in order to meets its requirement To capital structure influences the shareholders return & risk. To identify the finance resources of the company. The dividend decision bearing on the capital structure of the company. The capital structure affect the companys EPS & EBIT. The new financing decision of the company may affect its debt-equity mix or ratio.

OBJECTIVS OF THE STUDY To know the effect of capital structure planning on companys profit. To study the capital structure of the company. To examine the leverage analysis of company. METHODOLOGY OF THE STUDY Data is obtained from various reports available with company. The information collected through secondary sources of data, which included companys reports, manuals, and websites. LIMITATION OF THE STUDY These were the constrains which have faced at the time of study

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As the study was mainly based on the published information it is bound to suffer from certain limitations. The ratio analysis & other tools used might contain few general limitations of the financial statement such as yearend figures are considered for conclusion.

CAPITAL STRUCTURE MEANING OF CAPITAL STRUCTURE The term capital structure is used to represent the proportionate relationship b/w debt & equity. Estimation of capital requirement is necessary but the formation of capital structure is important. The term capital structure refers to the relation between various long term form of financing such as equity share capital, preference share capital & debenture. Capital structure refers to the way corporation finance its assets through some combination of equity debt. The term capital structure refers to the relationship between the various long term sources financing such as equity capital, preference capital and debt capital. Deciding the suitable capital structure is the important decision of the financial management because it is closely related to the value of the firm. According to Prasanna Chandra the composition of a firms financing consists of equity, preference and debt. Types of capital structure: 1. Simple capital structure 2. Compound capital structure 3. Complex capital structure 1. Simple capital structure: A simple capital structure consists of single security base as a source of found to finance the activities of a concern. 2. Compound capital structure: In compound capital structure a combination of two security base in the form of equity and preference capital or equity share capital and debenture are used as a sources of funds.

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3. Complex capital structure: A complex capital structure is made up of multi security base, consisting of equity, preference debenture and loans from financial institutions.

CAPITAL STRUCTURE PLANNING INTRODUCTION Effective business management requires careful planning and decision-making about the balance of debt and equity used in financing the business. The key for business owners is to evaluate their company's particular situation and determine its optimal capital structure. An optimal capital structure is one that strikes a balance between risk and return and maximizes the price of the stock while simultaneously minimizing the cost of capital. Companies use both debt and equity to finance their activities and the mix of debt and equity constitute a businesss capital structure. Companies choose between debt and equity depending on their current and expected future profitability. In general, the use of debt can put certain financial constraints on a business, but in exchange it allows greater returns for the companies current equity holders. The cost of debt often is cheaper than the cost of equity, but the use of debt can have a potentially negative effect on the overall future financing cost of a company. Capital structure planning refers to the designing of an appropriate capital structure in the context of facts & circumstances of each firm. Planning the capital structure means selecting a desired debt-equity combination in advance. The initial capital structure is determined at the time the firm is promoted. So, this structure should be designed very carefully. Deciding the suitable capital structure is the important decision of the financial management because it is closely related to the value of the firm. Capital structure is the permanent financing of the company represented primarily by long-term debt & equity. A widely used financial technique to design an appropriate capital structure is EBIT-EPS analysis. As a method of capital structure planning, it essentially involves the comparison of alternatives of financing under various assumptions of EBIT. The choice of combination of sources with the capital structure would be one which, for a given

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level of EBIT, would ensure the largest EPS. Alternatively the choice of combination should ensure the maximum market price per share (MPS) = EPS* P/E ratio

Advantages of Equity Financing Equity financing do not create any obligation to pay a fixed rate of dividend. Equity financing can be issued without creating any charge over the assets of the company. It is a permanent source of capital and the company has not to repay it except under liquidation. The investments do not increase a companys fixed costs or fixed payment burden. Equity financing do not require a pledge of collateral.

Disadvantages of Equity Financing If only equity financing issued, the company cannot take the advantage of trading on equity. As equity capital cannot be redeemed, there is a danger of over capitalization.

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Equity financing can put obstacles in management by manipulation and organizing themselves. During prosperous periods higher dividends have to be paid loading to increase in the value of shares in the market and speculation. Investors who desire to invest in safe securities with a fixed income have no attraction for such shares. Advantages of debt financing Debt financing generate and retain greater investment returns for a companys equity holders. Borrowing costs from the use of debt usually are less expensive than those on equity financing, because debt holders enjoy greater guarantees about the safety of their investments than equity holders. Lower cost debt financing improving its profit margins. The use of debt also has a tax advantage compared to equity financing. Debt financing is that allows the founders to retain ownership and control of the company. It provides owners with a greater degree of financial freedom than equity financing. Disadvantages of debt financing To the use of debt is the financial distress that debt can exert on a company. The debt financing is that it requires making regular payment of principal and interest. Debt financing is that its availability is often limited to established businesses.

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EBIT-EPS ANALYSIS The EBIT-EPs analysis is one of the important tools in the hands of financial manager to get an insight into the firms capital structure. The earnings before interest & tax (EBIT) & earnings per share (EPS) analysis useful in examining the effect of financial leverage to analyze the behavior of EPS with varying levels of EBIT under alternative financial plans. A capital structure may consist of debt & equity in different proportions. When EBIT and EPS analysis is used, the stress is to select the financial plan that will give the highest value of EPS. Fundamentally, there is no conflict between the two approaches, i.e., financial leverage and EBIT analysis. EBIT analysis shows the effect of financial leverage on EPS. Thus, both the approaches can be simultaneously used for decision-making. LEVERAGES Leverages a business term that refers to borrowing. If a business is leveraged it means that the business has borrowed money to finance the purchase of assets. The other way to purchase assets is through use of owner funds or equity. One way to determine leverage is to calculate the Debt-to-Equity ratio showing how much of the assets of the business are financed by debt and how much by equity. Leverage is not necessarily a bad thing. Leverage is useful to fund company growth and development through the purchase of assets. But if the company has too much borrowing, it may not be able to pay back all of its debts. The degree to which an investor or business is utilizing borrowed money. Companies that are highly leveraged may be at risk of bankruptcy if they are unable to make payments on their debt; they may also be unable to find new lenders in the future. TYPES OF LEVERAGES Operating leverage

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Financial leverage Total/Combined leverage

Operating Leverage The percentage of fixed costs in a companys cost. Generally, the higher the operating leverage, the more a companys income is affected by fluctuation in sales volume. The higher income vs. sales ratio results from a smaller portion of variable costs, which means the company, does not have to pay as much additional money for each unit produced or sold. Operating Leverage= Contribution (sales Variable Cost) Operating profit (Contribution Fixed Cost) OR Contribution EBIT Financial Leverage The use of borrowed money to increase production volume, and thus sales and earnings. It is measured as the ratio of total debt to total assets. The greater the amount of debt, the greater the financial leverage. Since interest is a fixed cost (which can be written off against revenue) a loan allows an organization to generate more earnings without a corresponding increase in the equity capital requiring increased dividend payments (which cannot be written off against the earnings). However, while high leverage may be beneficial in boom periods, it may cause serious flow problems in recessionary periods because there might not be enough sales revenue to cover the interest payments. Called gearing in UK see also investment leverage and operating leverage. Financial Leverage = PBIT PBT

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Total/ Combined Leverage A leverage ratio that summarizes the combined effect the degree of operating leverage (DOL), and the degree of financial leverage has on earnings per share (EPS), given a particular change in sales. This ratio can be used to help determine the most optimal level of financial and operating leverage to use in any firm. Combined Leverage = Operating Leverage Financial Leverage Return on Investment (ROI) ROI analysis is one of the several commonly used financial metrics for evaluating the financial consequences of business investments, decisions or actions. ROI analysis compares the magnitude and timing of investment gains directly with the magnitude and timing of investment costs. A high ROI means that investment gains compare favorably to investment costs. In the last few decades, ROI has become a central financial metric for asset purchase decisions (for example computer systems, factory machines, or service vehicles) approval and funding decisions for projects and programs of all kinds (such as marketing programs, recruiting programs and training programs) and more traditional investment decisions (such as the management of stock portfolios or the use of venture capital). ROI = Net Income Debt & equity Return on Equity (ROE) Return on equity is a measure of how well a company used reinvested earnings to generate additional earnings, equal to a fiscal years after- tax income (after preferred stock dividends but before common stock dividends) divided by book value, expressed as a percentage. It is used as a general indication of the company s efficiency; in other words, how much profit it is able to generate given the resources provided by its stockholders. Investors usually look for companies with returns on equity that are high and growing. ROE = Net Income

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Equity share holder fund RATIO ANALYSIS Ratio Analysis is a form of financial statement analysis that is used to obtain a quick indication of a firms financial performance in several key areas. The ratios are categorized as Short-term solvency ratios, Debt management ratio, Asset management ratios, Profitability ratios &Market value ratios. Ratio Analysis as a tool possesses several important features. The data, which are provided by financial statements, are readily available. The computation of ratios facilitates the comparison of firms which differ in size. Ratios can be used to compare a firms financial performance with industry averages. In addition, ratios can be used in a form of trend analysis to identify areas where performance has improved or deteriorated over time. RATOS 1. Fixed asset coverage ratio 2. Interest coverage ratio 3. Debt equity ratio 4. Debt to total asset ratio

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