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The most emotional purchases anyone can make. When real estate
professionals work with top interior designers to create imaginative
living environments, consumers will be able to picture themselves at
home they wont have to re-imagine an empty space. Our hope is
that this event will create lasting partnerships between both
industries.
Shreeji Asia is one of the most diversified construction groupReal
estate is not just about selling a space; it's about selling a lifestyle,
buying a home is one of s with activities across India, covering
development of commercial buildings, residential land and designing
false ceilings, and most other works related to the development of
classy global interiors.
Shreeji Asia Pvt. Ltd. is the parent company having two verticals
under it, that is, Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd. and
Shreeji Interiors.
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works
related
to
the
development
of
Interiors.
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Moreover, the construction sector has also been responsible for the
development of over 250 ancillary industries such as cement, steel,
paints, brick, timber, building materials etc. A study by a credit rating
agency ICRA shows that the construction industry ranks third among
the 14 major sectors in terms of direct, indirect and induced effects in
all sectors of Indian economy. A unit increase in expenditure in the
real estate sector can generate a fivefold increase in income. With the
downturn in the economy, and being a capital-intensive industry, the
real estate sector started to face a liquidity crunch emanating largely
from banks cautious approach to financing real estate companies. This
approach was reflected in lower loan-to-loan property value,
construction-linked payment ad financing only for projects nearing
completion. Further, real estate developers also had to cope with other
sources of funding, such as private equity and stock markets, drying
up considerably; receivables from residential projects under
construction getting blocked; falling demand and buyers deferring
payments until they took possession of properties. The resultant fall in
valuation I the past few months coupled with high interest rates and
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Indian real estate market size is expected to touch US$ 180 billion by
2020. Foreign Direct Investment (FDI) in the sector is expected to
increase to US$ 25 billion in next 10 years, from present US$ 4
billion.
Demand is expected to grow at a compound annual growth rate
(CAGR) of 19 per cent between 2010 and 2014, with tier I
metropolitan cities projected to account for about 40 per cent of this.
Growing infrastructure requirements from sectors such as education
health care and tourism are also providing opportunities in the real
estate sector.
The construction industry ranks third among the 14 major sectors in
terms of direct, indirect and induced effects in all sectors of the
economy. The industry's growth is linked to developments in the
retail, hospitality and entertainment (hotels, resorts, cinema theatres)
sectors, economic services (hospitals, schools) and information
technology (IT)-enabled services (like call centers) etc. and vice
Versa.
The sector is divided into 4 subsectors
Housing;
Retail;
Hospitality;
Commercial;
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DLF Ltd
DLF group is a leading real estate developer in India since 1946. DLF
has been instrumental in putting Gurgaon on the urban landscape of
India. DLF has over 220 million sq. ft. of existing development
projects and 574 million sq. ft. of planned projects. DLF has so far
developed 22 urban colonies, and an entire integrated 3,000-acre
township - DLF City. DLF's development projects across India span
over 30 cities: Gurgaon, Ambala, Shimla, Amritsar, Jalandhar,
Ludhiana, Sonepat, Panipat, Chandigarh, Panchkula, Noida, New
Delhi, Jaipur, Indore, Ahemdabad, Baroda, Lucknow, Faridabad,
Mumbai, Pune, Nagpur, Goa, Kochi, Kokkanad, Chennai, Bangalore,
Vytilla, Coimbatore, Hyderabad, Bhubaneswar and Kolkata.
ii)
Unitech
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Ansal API
iv)
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capital markets.
Till date, Sobha has completed 47 residential projects, 13 commercial
projects and 166 contractual projects covering about 36 million sqft
area in 18 cities across India (as of 31 March 2010). The company
currently has 21 ongoing residential projects aggregating to 8.5
million sqft, while 4.24 million sqft of contractual projects are under
various stages of construction.
v)
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Investment Opportunities
The real estate industry in India is yet in a promising stage. The sector
happens to be the second largest employer after agriculture and is
expected to grow at the rate of 30 per cent over the next decade. A
growing migrant population due to increasing job opportunities,
together with healthy infrastructure development, is underpinning
demand in the regions residential real estate market.
The Kalpataru spokesperson feels that the Finance Ministry's
motivation through softening of interest rates and lending more to the
real estate sector will have a positive impact on both developers and
consumers. The real estate market could start to perform better as the
easing of FDI norms will begin to show results during the second half
of the year. The economy will also recover in 2013 which in turn will
perk up the real estate sector in India. With the government trying to
introduce developer and buyer friendly policies, the outlook for real
estate in 2013 does look promising.
1.2. J. THE ROAD AHEAD
India has huge potential to attract large foreign investments into real
estate. With real estate reaching a point of saturation in developed
countries and the demand and prices falling, global real estate players
are looking at emerging economies such as India for tapping
opportunities in real estate. Indian real estate will stay attractive due to
its strong economic fundamentals and demographic factors. Moreover,
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their grasp and its being reected in the growing industry of Interior
design.
1.2. M. AN INTRODUCTION TO THE INTERIOR DESIGN
INDUSTRY
Interior Design, as a separate specialised design discipline, is a
relatively new eld in India. It has now been recognized as a
profession different from decorators and architects dominating the
eld for historic reason. Today, Interior design in India has come a
long way. It has gained autonomy from Architecture and is not just
reduced to decoration and furnishings anymore. Interior Design sees
space as a living environment and is a holistic resolution of the sociocultural, emotional and resource conditions of the context it
represents.
In the context of design, Interiors refers to any space within an
enclosed structure that is inhabitable and human centred. These spaces
include residences, ofces, institutions, schools, hospitals, theatres,
restaurants, hotels and resorts, airports and the like. This context also
spills onto the structures extensions such as porches, entrances,
swimming pools, landscaped areas, decks, patios etc.
The scope is so diverse in todays times, that the aspects of Interior
Design encompass all those contexts and more. This has led to Interior
Designs fragmentation into a variety of specialized micro-disciplines
such as Residential Design, Office Design, Retail and Commercial
Design, and Hospitality Design.
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RESIDENTIAL DESIGN
Thinking of buying a condominium or a house and can't
understand the builder's floor plans and how they will work for you?
Whether you are updating a bathroom or kitchen, planning a major
renovation or looking to add an extension to your home, an interior
designer can help you realize your design dream. An interior designer
will guide you through the process of choosing the right floor plan and
finishes.
Interior design begins with you. Our members are skilled at analyzing
the needs, goals, lifestyle and safety requirements of their clients and
integrating them into a functional and aesthetically attractive design
concept. Interior designers have unique training in designing interior
environments and are able to provide a full scope of services to
complete the project on time and on budget.
By hiring a professional interior designer for your next project, you're
adding value to your home, minimizing risk and keeping costs down.
Plus, with fees making up only a small portion of the overall real
estate/construction costs, hiring a qualified interior designer is a wise
investment in the successful outcome of your project.
WORKPLACE DESIGN
A well-designed corporate space or workplace environment can
potentially improve quality of life, promote productivity and increase
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building
technology, ergonomics,
environmental
and
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you realize a facility that meets the needs of staff and patients while
respecting strict infection control and building codes.
HOSPITALITY DESIGN
Want to be on the top ten lists of hotels, restaurants and bars?
Consider design a key business strategy to pull customers into your
hospitality space.
Whether on holiday at a hotel or spa, or just out for a night on the
town, great hospitality design can shape a client's experience. Whether
you're renovating or constructing a new facility, working with a
professional interior designer can ensure that your clients have a
memorable experience in your space.
Most importantly, you'll be adding value to your project by maintains
project costs and minimizing risk by ensuring that the design complies
with all regulatory and legal requirements and protects the health,
safety and welfare of the occupants. At the end of the day, hiring a
qualified interior designer is a wise investment in the successful
outcome of your project.
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D) Operational efficiency
E) Structural analysis
F) Effective utilization of resources
G) Leverages or external financing
STEPS IN RATIO ANALYSIS
The ratio analysis requires two steps as follows:
1] Calculation of ratio
2] Comparing the ratio with some predetermined standards. The
standard ratio may be the past ratio of the same firm or industrys
average ratio or a projected ratio or the ratio of the most successful
firm in the industry. In interpreting the ratio of a particular firm, the
analyst cannot reach any fruitful conclusion unless the calculated ratio
is compared with some predetermined standard. The importance of a
correct standard is oblivious as the conclusion is going to be based on
the standard itself.
TYPES OF COMPARISONS
The ratio can be compared in three different ways
1] Cross section analysis:
One of the way of comparing the ratio or ratios of the firm is to
compare them with the ratio or ratios of some other selected firm in
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If the cross section & time analysis, both are combined together to
study the behavior & pattern of ratio, then meaningful &
comprehensive evaluation of the performance of the firm can
definitely be made. A trend of ratio of a firm compared with the trend
of the ratio of the standard firm can give good results. For example,
the ratio of operating expenses to net sales for firm may be higher
than the industry average however, over the years it has been
declining for the firm, whereas the industry average has not shown
any significant changes
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relationship between the assets & the liabilities, of the concern. These
ratio help to judge the liquidity, solvency & capital structure of the
concern. Balance sheet ratios are Current ratio, Liquid ratio, and
Proprietary ratio, Capital gearing ratio, Debt equity ratio, and Stock
working capital ratio.
2] Revenue ratio:
Ratio based on the figures from the revenue statement is called
revenue statement ratios. These ratios study the relationship between
the profitability & the sales of the concern. Revenue ratios are Gross
profit ratio, Operating ratio, Expense ratio, Net profit ratio, Net
operating profit ratio, Stock turnover ratio.
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3] Composite ratio:
These ratios indicate the relationship between two items, of which one
is found in the balance sheet & other in revenue statement.
BASED ON FUNCTION:
Accounting ratios can also be classified according to their functions in
to liquidity ratios, leverage ratios, activity ratios, profitability ratios &
turnover ratios.
1] Liquidity ratios:
It shows the relationship between the current assets & current
liabilities of the concern e.g. liquid ratios & current ratios.
2] Leverage ratios:
It shows the relationship between proprietors funds & debts used in
financing the assets of the concern e.g. capital gearing ratios, debt
equity ratios, & Proprietary ratios.
3] Activity ratios:
It shows relationship between the sales & the assets. It is also known
as Turnover ratios & productivity ratios e.g. stock turnover ratios,
debtors turnover ratios.
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4] Profitability ratios:
a It shows the relationship between profits & sales e.g. operating
ratios, gross profitratios, operating net profit ratios, expenses
ratios
b It shows the relationship between profit & investment e.g.
return on investment, return on equity capital.
5] Coverage ratios:
It shows the relationship between the profit on the one hand & the
claims of the outsiders to be paid out of such profit e.g. dividend
payout ratios & debt service ratios.
BASED ON USER:
1] Ratios for short-term creditors:
Current ratios, liquid ratios, stock working capital ratios
2] Ratios for the shareholders:
Return on proprietors fund, return on equity capital
3] Ratios for management:
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LIQUIDITY RATIO: Liquidity refers to the ability of a firm to meet its short-term (usually
up to 1 year) obligations. The ratios, which indicate the liquidity of a
company, are Current ratio, Quick/Acid-Test ratio, and Cash ratio.
These ratios are discussed below:CURRENT RATIO
Meaning:
This ratio compares the current assets with the current liabilities. It is
also known as working capital ratio or solvency ratio. It is
expressed in the form of pure ratio.
E.g. 2:1
Formula:
Current assets
Current ratio =
Current liabilities
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LIQUID RATIO:
Meaning:
Liquid ratio is also known as acid test ratio or quick ratio. Liquid ratio
compares the quick assets with the quick liabilities. It is expressed in
the form of pure ratio. E.g. 1:1.
The term quick assets refer to current assets, which can be converted
into, cash immediately or at a short notice without diminution of
value.
Formula:
Quick assets
Liquid ratio =
Quick liabilities
CASH RATIO
Meaning:
This is also called as super quick ratio. This ratio considers only the
absolute liquidity available with the firm.
Formula:
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=
Total current liabilities
EARNING PER SAHRE:Meaning:Earnings per Share are calculated to find out overall profitability of
the organization. Earnings per Share represent earning of the company
whether or not dividends are declared. If there is only one class of
shares, the earning per share are determined by dividing net profit by
the number of equity shares.
EPS measures the profits available to the equity shareholders on each
share held.
Formula:
NPAT
Earnings per share =
Number of equity share
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Meaning:
DPS shows how much is paid as dividend to the shareholders on each
share held.
Formula:
Dividend Paid to Ordinary Shareholders
Dividend per Share =
Number of Ordinary Shares
100
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Meaning:
This ratio measures the relationship between gross profit and sales. It
is defined as the excess of the net sales over cost of goods sold or
excess of revenue over cost. This ratio shows the profit that remains
after the manufacturing costs have been met. It measures the
efficiency of production as well as pricing. This ratio helps to judge
how efficient the concern is I managing its production, purchase,
selling & inventory, how good its control is over the direct cost, how
productive the concern , how much amount is left to meet other
expenses & earn net profit.
Formula:
Gross profit
Gross profit ratio =
100
Net sales
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NPAT
Net profit ratio =
100
Net sales
RETURN ON CAPITAL EMPLOYED:Capital employed refers to the long-term funds invested by the
creditors and the owners of a firm. It is the sum of long-term liabilities
and owner's equity. ROCE indicates the efficiency with which the
long-term funds of a firm are utilized.
Formula:
NPAT
Return on capital employed =
100
Capital employed
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Formula:
Credit sales
Debtors turnover ratio =
Average debtors
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PROPRIETORS RATIO:
Meaning:
Proprietary ratio is a test of financial & credit strength of the business.
It relates shareholders fund to total assets. This ratio determines the
long term or ultimate solvency of the company.
In other words, Proprietary ratio determines as to what extent the
owners interest & expectations are fulfilled from the total investment
made in the business operation.
Proprietary ratio compares the proprietor fund with total liabilities. It
is usually expressed in the form of percentage. Total assets also know
it as net worth. The Formula is:Shareholders fund
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Proprietary ratio =
Fixed assets + current liabilities
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This ratio compares the long-term debts with shareholders fund. The
relationship between borrowed funds & owners capital is a popular
measure of the long term financial solvency of a firm. This
relationship is shown by debt equity ratio. Alternatively, this ratio
indicates the relative proportion of debt & equity in financing the
assets of the firm. It is usually expressed as a pure ratio. E.g. 2:1
Formula:
Total long-term debt
Debt equity ratio =
Total shareholders fund
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NPAT
Return on proprietors fund =
100
Proprietors fund
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Ratio analysis not only throws light on the financial position of firm
but also serves as a stepping-stone to remedial measures. This is made
possible due to inter firm comparison & comparison with the industry
averages. A single figure of a particular ratio is meaningless unless it
is related to some standard or norm. One of the popular techniques is
to compare the ratios of a firm with the industry average. It should be
reasonably expected that the performance of a firm should be in broad
conformity with that of the industry to which it belongs. An Inter firm
comparison would demonstrate the firms position vice-versa its
competitors. If the results are at variance either with the industry
average or with those of the competitors, the firm can seek to identify
the probable reasons & in light, take remedial measures.
6] TREND ANALYSIS:
Finally, ratio analysis enables a firm to take the time dimension into
account. In other words, whether the financial position of a firm is
improving or deteriorating over the years. This is made possible by
the use of trend analysis. The significance of the trend analysis of
ratio lies in the fact that the analysts can know the direction of
movement, that is, whether the movement is favorable or unfavorable.
For example, the ratio may be low as compared to the norm but the
trend may be upward. On the other hand, though the present level may
be satisfactory but the trend may be a declining one.
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may
also
distort
intercompany
comparison.
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RESEARCH DESIGN
A research design is a logical systematic plan prepared for directing a
research study. it specifies the
objectives of the study, the
methodology and the techniques to be adopted for achieving the
objective.
2.1 TITLE OF THE STUDY:
A study on Ratio Analysis of SHREEJI INTERIORS
2.2 STATEMENT OF THE PROBLEM:-
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To study
INTERIORS"
liquidity
solvency
position
of
"
SHREEJI
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---------------------------------Current liabilities
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Total liability
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Debt-Equity Ratio =
------------------------------Shareholder Equity
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Secondary Data:The primary data obtained has been supported with use of secondary
data collected from the books, annual reports, financial statements,
periodicals and other sources have been referred for data collection.
2.8 SAMPLE DESIGN:
It denotes the number of people surveyed actually and this sample size
will be taken by adopting some type of sampling technique.
Companies last three years of balance sheet as a sample three years
balance sheet was taken on the basis of convenience.
2.9 METHODOLOGY:-
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The solution has been found through the respective formula and
then by the analysis and interpretation the conclusion has been
provided to the organization.
2.10 TOOLS FOR DATA COLLECTION
The data collected from the various sources has to be processed and
analyzed systematically.
These includes such as:
Identification of the absolute increase or decrease in the various
assets and liabilities, reflecting the performance of the company.
Identification of the percentage chain in the assets and liabilities in
the balance sheets of three years.
Application of ratio analysis and trained analysis of the period of
the study.
Calculation of the various ratios reflecting the profitability,
liquidity position of the company for the period of the study.
Finally, forwarding suggestions and conclusions. The above is the
analysis plan for the research.
2.11 PLAN OF ANALYSIS:-
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The data collected from the organization has been analyzed according
to the objectives to the study. For this purpose a statistical tool ratio
analysis are used along with the bar diagrams.
2.12 REFERENCE PERIOD:The accounts, various records and reports for period of three years are
being referred for the purpose of the study.
2.13 LIMITATIONS OF THE STUDY
1.
The analysis is based on the information available from the
company therefore the results depend on the accuracy of the reports of
the company.
2.
3.
The analysis and the findings are related to SHREEJI
INTERIORS and hence the findings cannot be generalized to other
organization.
4.
Based on the limited information it is not possible to arrive at
proper conclusion.
5.
The inferences that have been framed only on the basis of
financial statements.
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1.3
COMPANY PROFILE
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Project Planning,
Designing,
buildings,
residential
land
and designing
false
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The
company
has
four
main
departments
i.e.
Business
the
company
gets
project,
the Purchase
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and
residential purposes,
delivering
products
and
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architecture,
interiors
and
decor.
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Our varied list of Clients speaks for our ability to carry out
challenging jobs within the required time frame as your project moves
from abstraction to physical reality. The key to our excellence is
enabling you to express your individuality and bring your concepts
from drawings to life. Our hands-on approach is consistent from
project's
inception,
throughout
construction
until
completion.
needs
implemented
and
then
according
to
the
project
consumer
The
developing,
managing
building
and
is
designed
preferences.
groups activities
properties.
In
With
and
a
comprise
addition,
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has
resulted
in
unique
people-centric
business
taken
into
account,
while
designing
and
developing
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by
being
dynamic,
flexible,
innovative
and
operationally excellent.
Understanding
To meet clients' needs by first understanding our clients'
businesses and needs.
Service
To practice servant leadership and develop a serviceoriented culture at all levels.
Training
To be a learning organization that helps people realize their
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technology,
to
offer
the
consumer
world-class
experience.
1.3.E. Mission
To shape, manage, revive and nurture space, as a sacred
community resource and thus build, with an emphasis on
structural durability, functionality, ergonomics and aesthetics, for
a better quality of life.
1.3.F. Corporate Social Responsibility
The Shreeji Group believes that, individuals and corporate entities
are products of beneficial social forces.
The group assigns a specific part of its profit, to serve the
purpose of education and health for the underprivileged.
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PRODUCTS PROFILE
Having been in the industry for a long time, the company understand
the demands of the market in terms of distinctive architecture and
dcor. Our highly dedicated and experienced Team is committed to
executing quality works, providing our Clients with customer-friendly
approach and true enthusiasm from project's planning stage till its
completion.
Products and Services
Infrastructure
Interiors
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Factor
PIPALIYA INFRASTRUCTURE
(ASIA)
PVT.
LTD. we serve a wide range of Clients, providing them with worldclass commercial, industrial and residential premises. Every year 80%
of our projects are executed for our repeat Clients, who look to SPI
(ASIA) to complete each assignment at an efficient, cost-effective and
professional manner.
At Shreeji Pipaliya Infrastructure (Asia) Pvt. Ltd. we own hightech equipment to support our performance in terms of time and
quality. We always keep in mind the precision and safety of our work,
therefore we use brand new machinery of world-class makers.
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M/s. RMZ
M/s. TCS
M/s. Triveni
M/s. UST Global
M/s. VOLVO
HOSPITALITY
M/s. ABB Guesthouse
M/s. Desai Bro's Farmhouse
M/s. Esteem Silk Pvt. Ltd. Farmhouse
M/s. Hotel Royal Orchid (Doddis Resort)
M/s. Hotel Shelton Grand
RETAIL
M/s. Citi Bank
M/s. C Krishniah Chetty & Sons
M/s. Ducati
M/s. Kapoor Lamps
M/s. Levi's Museum Store
M/s. Neptune Travels
EDUCATION
M/s. British Library
RESIDENTIAL
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Nos.
1Nos.
11
22
11
61
8
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COMPETITORS PROFILE
Competitor profiles enable us to see at a glance the information you
need on your competitors. Depending on the format and content, they
can provide anything from the background information required by
the sales force to the information that the board needs when
investigating potential acquisitions or deciding major strategic
initiatives against a competitor. The exact format will depend on your
needs and the key intelligence topics you want covered.
Each competitor profile should be customised so that the focus is on a
specific aspect. For example the sales force need to know your
competitive situation:
Who else is selling similar products and services?
How?
At what price?
Through which channel?
What promotional materials are used?
What sales tactics are used?
And so on.
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This sales focused kind of profile will include information that will
help your sales team to sell effectively answering customer queries
about your products or services compared to competitor equivalents,
However it would have no or less information on the competitor's
strategies, operations or finances. Such information would be included
in a profile drafted for senior / board level management, which might
have less of the sales-type data.
1.5.A. COMPETITORS
DESIGN ARC INTERIOR
Design Arc Interior is a highly revered interior dcor and interior
design company offering exclusive services in home interior
designing, commercial interior designing as well as 3D visualization
services to clients in Bangalore and Dubai. The teams of highly
skilled and respected interior designers in Design Arc Interior offer
their exclusive interior designing. A highly prolific interior designing
company specializing in residential space design, commercial spaces
design as well as services in 3D visualization.
Founded in 2006, Design Arc Interiors is an interior dcor and interior
designing company offering exclusive services in living and work
place interior design in Bangalore and Dubai. They work in
partnership with Cambridge Electro Mechanical located in Abu
Dhabi, UAE, who work in close coordination with DAI with all
interior projects in Dubai.
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PURCHASE DEPARTMENT
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Purchase Bill:
Purchase Bill is a document which is generated by the vendor and sent
to the company. The Purchase Bill is either delivered on the site along
with the material or is sent to Office.
Cash Voucher:
Cash Voucher is a document generated in the company when cash
payment is made against a bill. Any type of Cash payment from the
company is recorded in cash voucher. Cash payments are given for
small purchases. Generally Miscellaneous expenses like Labor Food
Expense, Water expense, Fuel Expense and all the purchases done
without Purchase Order are paid through Cash.
Bank Voucher:
Bank Vouchers are generated by the Company whenever expenses are
done by any of the following modes:
Cheque
Demand Draft
RTGS Real Time Gross Settlement
NEFT National Electronic Fund Transfer
These modes are used to pay large sums of money. Generally,
payment against Purchase Bills is done through these modes. Unlike
Cash Book, the details of Bank Vouchers are entered in Tally.
2. Human Resource
We often hear the term Human Resource Management, Employee
Relations and Personnel Management used in the popular press as
well as by Industry experts. Whenever we hear these terms, we
conjure images of efficient managers busily going about their work in
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activities
RECOGNITION
A means of acknowledging employees for sustained outstanding
performance/service and providing incentives to continue provide
outstanding performance/service. Recognition should be linked to
performance outcomes. For example, employees should be
recognized/rewarded for being results-oriented and customer-focused.
Other contributing factors could be increased morale, contribution to
team cohesiveness, contribution to the success of the performance
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Current ratio
2.
Quick ratio
Debt/equity ratio
4.
5.
6.
Return on investment
7.
8.
9.
10.
11.
12.
13.
14.
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1. CURRENT RATIO
Meaning:This ratio compares the current assets with the current liabilities. It is
also known as working capital ratio or solvency ratio. It is
expressed in the form of pure ratio.
Formula:Current assets
Current ratio = ------------------------Current liabilities
CURRENT
CURRENT
CURRENT
ASSETS
LIABILITIES
RATIO
(In Rs.)
(In Rs.)
2010-2011
1,56,73,262.86
1,34,20,567.03
1.17:1
2011-2012
3,76,05,804.27
1,75,82,387.41
2.14:1
2012-2013
7,29,69,335.90
3,46,66,200.82
2.10:1
YEAR
Analysis:-
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The analysis shows that the current ratio of the company in the year
2010-11 is 1.17, 2011-12 is 2.14 and 2012-13 is 2.10. This also shows
that company is maintaining good liquidity position. Only 2010-11,
the ratio of the company decreases compares to 2011-12 and 2012-13.
CURRENT RATIO
1.17
2.1
2010-11
2011-12
2012-13
2.14
Interpretation:The current ratio of the company having lesser than the standard ratio
i.e. 2:1 only in 2010-11 and later year company is maintaining
standard ratio in 2011-12 & 2012-13. So company is maintaining their
good liquidity position i.e. standard ratio 2:1
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2. QUICK RATIO
Meaning:This is the real index of the financial liquidity of the concern. It
calculates the companys liquid assets in relation to its liabilities. It is
also called as acid test ratio or liquid ratio.
Formula:Quick assets
Quick ratio = -----------------------------------Quick liabilities
Table-4.2QUICK RATIO
YEAR
QUICK
ASSETS
QUICK QUICK
LIABILITIES
RATIO
2010-2011
5576282.86
13420567.03
100
0.42:1
SHREEJI ASIA
2011-2012
11727598.27
17582387.41
0.67:1
2012-2013
21532685.9
34666200.82
0.62:1
Analysis:A quick liability consists of current liabilities for the year 2010-11,
2011-12, and 2012-13. Whereas quick asset consists of cash and bank
balance, advances and other assets; expect for the prepayments.
QUICK RATIO
0.42
0.62
2010-11
2011-12
2012-13
0.67
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YEAR
LONG TERM
DEBTS
OWNERS
CAPITAL
DEBT EQUITY
RATIO
2010-2011
4763025.25
11147121.58
042:1
2011-2012
17731901.40
9906519.56
1.79:1
2012-2013
35732782.81
15228671.08
2.35:1
ANALYSIS:-
Here the debt equity ratio consists of long term debt and owners
capital. In 2010-11 company is having 0.43:1, which is lesser than the
standard ratio which is 1:1 and in 2011-12 and 2012-13 company is
having greater debt equity ratio which is also not good for the
company because high debt equity ratio indicates that the claim of the
creditors are greater than those of owners
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INTERPRETATION:Here the debt equity ratio consists of long term debt and owners
capital. A low debt equity ratio implies a greater claim of owners on
the assets of the company than the creditors and high debt equity ratio
indicates that the claims of the creditors are greater than those of
owners. Company should decrease their debt or pay their debt because
its not good for the company.
3. GROSS PROFIT RATIO:Gross profit ratio measures the relationship of gross profit to net sales
and is usually represented as a percentage.
Formula:-
Gross profit
Gross profit ratio = ---------------------------- 100
Net sales
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YEAR
GROSS PROFIT
SALES
GROSS
PROFIT
RATIO (In %)
2010-2011
13782720.06
8,91,13,153.32
15.44
2011-2012
17191397.69
11,11,74,494.55
15.38
2012-2013
15759052.98
7,28,33,712
20.84
ANALYSIS:Here the company is having 15.44% gross profit in 2010-11, in 201112 company is having 15.38% gross profit and 2012-13 company is
having 20.84% gross profit which is better than 2010-11 & 2011-12.
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2010-11
40%
2011-12
30%
2012-13
30%
INTERPRETATION:Gross profit ratio indicates the average margin on the goods sold. It
shows whether selling price is adequate or not. A low gross profit may
indicate a higher cost of production. A high gross profit ratio indicates
a lower cost and is a sign of good management. Here company is not
maintaining better profit margin.
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YEAR
NET PROFIT
NET SALES
NET PROFIT
RATIO
(In %)
2010-2011
4931242.90
89113153.32
5.53
2011-2012
3694061.81
72833712
4.60
2012-2013
5114275.88
11174494.55
5.07
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ANALYSIS:Here the company is having in 2010-11 5.53% net profit, in 2011-12 4.60% which is
getting decreases in 2011-12 and 2012-13 company is having 5.07% net profit which is
getting increases in 2012-13. This shows the company is not maintaining better net profit.
33%
36%
2010-11
2011-12
2012-13
30%
INTERPRETATION:The net profit ratio is over all measure of the firms ability to turn each rupee of sales into
profit. It indicates the efficiency with which a business is managed. A firm with high net
profit is an advantageous position to survive in the face of rising cost of production and
falling selling prices. Thus company should improve their net profit ratio.
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5. RETURN ON INVESTMENT
Meaning:This is the most important test of profitability of business. It measures
the overall profitability. It is ascertained by comparing profit earned
and capital employed to earn it.
Formula:Profit before interest & taxes
Return on investment = -------------------------------------------- 100
Total capital employed
YEAR
PROFIT BEFORE
INTEREST
&
TAXES
(PBIT)
TOTAL
CAPITAL
EMPLOYED
RETURN
INVESTMENT
(In %)
2010-2011
4931242.90
11147121.58
44.24
2011-2012
3694061.81
9906519.56
51.63
2012-2013
4931242.90
15228671.08
24.26
ANALYSIS:Here the company return on investment in 2010-11 is 44.24%, 201112 is 51.63% which is increases by 44.24% to 51.63% but the ROI in
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RETURN ON INVESTMENT
20%
37%
2010-11
2011-12
2012-13
43%
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Net profit
------------------------------working capital
YEAR
NET PROFIT
WORKING
CAPITAL
RETURN ON
WORKING
CAPITAL
(In %)
2010-2011
4931242.90
2252695.83
218.90
2011-2012
3694061.81
20023416.86
25.54
2012-2013
5114275.88
38303135.08
9.64
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4%
2010-11
2011-12
2012-13
86%
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determine this ratio from the balance sheet and income statement.
Company should maintain their return on working capital.
YEAR
COST
SOLD
OF
GOOD
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AVERAGE STOCK
STOCK
TURNOVER RATIO
(In times)
SHREEJI ASIA
2010-2011
75330433.26
11940990
6.30
2011-2012
55642314.31
17987593
3.10
2012-2013
95415441.57
38657428
2.47
ANALYSIS:Here the stock turnover ratio in 2011 6.30 times, in 2012 company is
having 3.10 times and 2013 it is 2.47 times. There is continuous
decreasing in stock turnover ratio, which is not good for the company.
2010-11
2011-12
2012-13
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YEAR
SALES
DEBTORS
DEBTORS
RURNOVER RATIO
(In times)
2010-2011
89113153.32
71295794.69
1.25
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2011-2012
111174494.55
94254642.73
1.18
2012-2013
72833712
27065729.93
2.69
ANALYSIS:Here debtors turnover ratio is 1.25, 1.18 and 2.69 as on 2011, 2012
and 2013 respectively. It indicates that company is not maintaining
their ratio in a proper way. Only 2012-13 company is getting their
debtors quickly.
3
2.69
2.5
2
DEBTORS TURNOVER RATIO
1.5
1.25
1.18
1
0.5
0
2010-11
2011-12
2012-13
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INTERPRETATION:This ratio lies in the fact that debtors constitute one of the important
items of current assets and this ratio indicates the how many days
average sales are tied up in the amount of debtors. A high debtors
turnover ratio indicates that debt are being collected more quickly.
Change in this ratio shows the change in the companys credit policy
or change in ability to collect from its debtors. The company should
maintain their ratio.
YEAR
SALES
NET
ASSETS
2010-2011
89113153.32
8726208.10
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FIXED
FIXED
ASSETS
TURNOVER RATIO
(In times)
10.21
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2011-2012
111174494.55
7615004.10
14.60
2012-2013
72833712
8964257
8.12
ANALYSIS:The analysis shows that a fixed asset turnover ratio of the company in
the year 2011 is 10.21 and 2012 is 14.60. Table shows that the ratio is
decreases in the year 2012-12 by 8.12 when it compares to last year
by 14.60.
16
14.6
14
12
10.21
10
8.12
8
6
4
2
0
2010-11
2011-12
2012-13
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INTERPRETATION:Fixed assets turnover ratio provides very useful information for both
investors and management about whether or not company is becoming
more efficient in the use of its fixed assets by comparing its value
with its historical records or industry average. A high ratio indicates
efficient utilisation of fixed assets in generating sales and a low ratio
may signify that the firm has an excessive investment in fixed assets.
There is an appreciable increase in fixed assets in 2012 compare to
another year.
WORKING CAPITAL TURNOVER RATIO
Meaning:This ratio indicates the efficiency or inefficiency in the utilisation of
working capital in making sales.
Formula:Sales
Working capital turnover ratio = --------------------------Net working capital
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YEAR
SALES
NET
WORKING
CAPITAL
WORKING
CAPITAL
TURNOVER RATIO
(In times)
2010-2011
89113153.32
2252695.83
39.56
2011-2012
111174494.55
20023416.86
5.55
2012-2013
72833712
38303135.08
1.90
ANALYSIS:The analysis shows that working capital turnover ratio in the year
2010 is 39.56, 2012 is 5.55 and 2013 is 1.90. Table shows that the
ratio decreases in the year 2011 and 2012 when it compare to last year
2010.
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45
40
39.56
35
30
WORKING CAPITAL
TURNOVER RATIO
25
20
15
10
5.55
5
1.9
0
2010-11
2011-12
2012-13
INTERPRETATION:A high working capital turnover ratio shows the efficient utilisation of
working capital in generating sales. A low ratio, on the other hand,
May indicates excess of net working capital. This ratio shows that the
working capital is efficiently utilised or not. Here the ratio keeps on
decreasing compare to year 2010.
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YEAR
PURCHASES
CREDITORS
CREDITORS
TURNOVER RATIO
(In times)
2010-2011
53439070.55
33112849.93
1.61
2011-2012
80201327.37
69015084.18
1.16
2012-2013
64264017.62
80058231.25
0.80
ANALYSIS:This analysis shows that creditors turnover ratio of the company in the
year 2011 is 1.61, 2012 is 1.16 and 2013 is 0.80. The table shows that
the creditors turnover ratio which keeps on decreasing.
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1.8
1.6
1.61
1.4
1.16
1.2
1
0.8
0.8
CREDITORS TURNOVER
RATIO
0.6
0.4
0.2
0
2010-11
2011-12
2012-13
INTERPREATATION:Here the data shows that creditors turnover ratio in the year 2010-11,
2011-12 and 2012-13 is 1.61, 1.16 and 0.80, which keeps on
decreasing. So it is good sign for the company because lower the
creditors higher profit and lower debt for the company.
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YEAR
SALES
TOTAL
CAPITAL
EMPLOYED
CAPITAL
TURNOVER RATIO
(In times)
2010-2011
89113153.32
15910146.83
5.60
2011-2012
111174494.55
27637420.96
4.02
2012-2013
72833712
50961543.88
1.43
ANALYSIS:The table shows that capital turnover ratio of the company in the year
2011 is5.60, 2012 is 4.02 and 2013 is 1.43.b Table also shows that the
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5.6
5
4.02
4
CAPITAL TURNOVER RATIO
3
1.43
2
1
0
2010-11
2011-12
2012-13
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Formula:Operating expenses
operating cost ratio = -------------------------------------- 100
sales
YEAR
OPERATING
EXPENSES
SALES
OPERATING COST
RATIO
(In %)
2010-2011
8851477.16
89113153.32
9.93
2011-2012
12078121.81
111174494.55
10.86
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2012-2013
12064991.17
72833712
16.57
ANALYSIS:Here the table shows that operating cost ratio of the company in the
year 2011 is 9.93, 2012 is 10.86 and 2013 is 16.57. Table also shows
that operating cost ratio which keeps on increasing compares to last
two year.
18
16.57
16
14
12
9.93
10.86
OPERATING COST
RATIO
10
8
6
4
2
0
2010-11
2011-12
2012-13
INTERPRETATION:-
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FINDINGS:1:- The current ratio shows the short term financial position and
policy. The standard ratio that is 2:1. The ratio of the company is
lower than the standard ratio i.e. 1.17:1 only in 2010-11 only. After
that company is maintaining their good liquidity position in 2011-12
is 2.14:1 and 2012-13 is 2.10:1.
2:- The quick ratio shows the ability to meet its immediate financial
commitments. Quick ratio 1:1 is considered to represent a satisfactory
current financial position. Company is having their quick ratio in the
year 2010-11 is 0.42:1, 2011-12 is 0.67:1 and 2012-13 is 0.62:1. Here
the company quick ratio is not satisfactory because its less than the
standard ratio i.e. 1:1. This is due to fact that the company does not
have a quick assets sufficient to meet its quick liabilities and quick
liabilities gone up more in proportion to the quick assets. The
company need to work on this.
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3:- The debt equity ratio of the company in the year 2010-11 is .
0.42:1, 2011-12 is 1.79:1 and 2012-13 is 2.35:1 which is keep on
increasing. The debt equity ratio of the company in the year 2010-11
is good because it is lower than the capital. But the year 2011-12
company has debt more than the capital which is double and 2012-13
debt is also more than the capital it is not good sign for the company.
So company should maintain their debt equity ratio.
4:- the net profit of the company is also decline compares to last year.
Because in the year 2010-11 the ratio is 5.53%, 2011-12 is 4.06% and
2012-13 is 5.07% which got decreases because of company huge debt.
So company should maintain their net profit otherwise company will
go in huge debt.
5:- the return on investment of the company is also decline in the year
2012-13 which is 24.26 compares to last year. So company should
maintain this ratio.
6:- The stock turnover ratio is also decreased because in the year
2010-11 the ratio is 6.30, 2011-12 is 3.10 and 2012-13 is 2.47 which
is also not good sign for the company. So company should increase
their
7:- Capital turnover ratio is also decreasing in the year 2011-12 and
2012-13 it is 4.02 & 1.43 when it compares to year 2010-11 the ratio
is 5.6. So it is not good sign for the company because high capital
turnover indicates high profit so company should maintain this ratio.
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8:- The operating cost ratio of the company in the year 2010-11 is
9.93, 2011-12 is 10.86 and 2012-13 is 16.57 which are increasing so
company should maintain this because higher operating ratio lower
profitability and lower the ratio greater profitability.
9:- Working capital turnover ratio of the company in the year 2010-11
is 39.56, 2011-12 is 5.55 and 2012-13 is 1.90. This is decreasing
compare to last year. A high working capital ratio shows the efficient
utilisation of working capital in generating sales.
CONCLUSIONS:1:- The proprietor does have clear mobilization of fund which can take
care of any liability at any period.
2:- The current assets and current liabilities is very favourable in
2011-12 and 2012-13 hence the company does not have any problem
in working capital requirements.
3:- The Companys credit policy is normal seen by the business cycle.
4:- In all the profit generated by the company for the last 3 years and
also transaction of the company is very favourable which will result in
the company is improving financial growth.
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