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A

SYNOPSIS
ON

A Study on ratio analysis of


financial statement of Hitachi koki
India ltd.

SUBMITTED TO
RASHTRASANT TUKADOJI MAHARAJ
NAGPUR UNIVERSITY
IN PARTIAL FULFILLMENT FOR AWARD OF
DEGREE OF BACHELOR OF
BUSINESS ADMINISTRATION

SUBMITTED BY
BHAVNA. M .GONNADE
GUIDED BY
PROF.
KAMLA NEHRU MAHAVIDALAYA,
SAKKARDARA, NAGPUR-09
(2014-2015)

SYNOPSIS
Sr.no.

Contents

Pag
e
No.

INTRODUCTION: GENERAL INTRODUCTION


INTRODUCTION OF COMPANY
(HITACHI KOKI LIMITED)

OBJECTIVES OF RESEARCH STUDY

HYPOTHESIS OF RESEARCH

RESEARCH METHODOLOGY

RATIO ANALYSIS IN HITACHI KOKI LIMITED

DATA ANALYSIS AND INTERPRETATION

CONCLUSION & SUGGESTION

BIBLIOGRAPHY

INTRODUCTION:
Finance is the life-blood of business, like
human body. Without blood there is no meaning of human body, like this without
finance there is no means to business. The main and basic objective of business
organization is to earn profit. For achieving this objective, funds are required. After the
fund raising, investing funds in the right place so as to incur more benefits. Many times
management fails because of decision making. That means investment is done where
return on investment is more. Before proceeding to examine the allocation and raising
of funds, tools of analysis is important. In allocation and raising funds, the finance
manager uses certain tools of Analysis, planning and control.
Financial statement analysis is defined as the process of
identifying financial strengths and weaknesses of the firm by properly establishing
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relationship between the items of the balance sheet and the profit and loss account.
There are various methods or techniques that are used in analyzing financial
statements, such as comparative statements, schedule of changes in working capital,
common size percentages, funds analysis, trend analysis, and ratios analysis.
Financial statements are prepared to meet external
reporting obligations and also for decision making purposes. They play a dominant
role in setting the framework of managerial decisions. But the information provided in
the financial statements is not an end in itself as no meaningful conclusions can be
drawn from these statements alone.

COMPANY PROFILE :
Hi-tachi Ltd. was founded in 1910 in
Hitachi Village, Japan by Namihei Odaira. The president and CEO is
Mr. Etsuhiko Shoyama. Since 1948 Hitachi Koki co. Ltd has been an
independent member of the broadly diversified Hitachi group. It
possesses over 90 years of Hitachi electro-mechanical research and
manufacturing expertise. Hitachi Koki maintains its position as
Japans leading maker of power tools through constant innovation to
make the job safer, easier and less tiring for every user and through
uncompromising adherence to high standards of quality in material
and workmanship.

Hitachi Koki India Ltd was


incorporated in April 1996, as a joint venture between Hitachi Koki
India Co Ltd, Japan and Indian Promoter. Hitachi Koki Japan holds
major shares of Hitachi Koki India Ltd. Hitachi Koki India deals in over
100 models of power tools that are used by Construction, Wood
Working and Engineering Industries. The Company has sales offices
in all Metro cities- Chennai, Mumbai, Delhi, and other cities such as
Ahmadabad, Secunderabad.
The Power
tools of Hitachi Koki Co. Ltd include Cordless tools, hammers,
hammer drills, disc grinders, sanders/polisher, drills, impact drill,
screw drivers, cutting tools, nailers and staplers. From its start as
a producer of industrial metalworking tools, the company has
developed into a manufacturer of high-value-added products. Its
policy of long-term R&D and human resource investment has
been the driving force for the continued progress of world-class
core technologies. In addition, close ties with research groups and
various operational divisions of Hitachi Ltd. represent a valuable
hidden asset.

OBJECT OF STUDY

To study the financial position of the firm

To communicate the firm about its financial health


and performance
To compare the performance with the help of
graphs
To ascertain the liquidity position of the company
during consecutive years
To gain insight into long term solvency position of
HITACHI KOKI INDIA LTD.
To ascertain the overall profitability position of
HITACHI KOKI INDIA LTD

HYPOTHESIS:
The A Study on ratio analysis of financial statement of Hitachi koki
India ltd.

are effective enough to take better financial decision by the

company.

Hypothesis is usually Considered as the Principal instrument in the


research: The ratio analysis mainly improves the decision making .
The ratio analysis mainly shows the profit structure of company.
Improve the customer departments efficiency and strengthen
its role in animating the process.

RESEARCH METHODOLOGY
Research can be defined as a scientific and
systematic and systematic search for pertinent information on a specific topic.
Research is concerned with defining and redefining problems, formulating
hypothesis, collecting and evaluating data and testing the solutions to
determine whether they fit the formulated hypothesis.

According to Redman &Moray, research is defined as a


systematized effort to gain new knowledge

MEANING OF RESEARCH METHODOLOGY:


Research Methodology is a
way to solve the research problem. Tt may be understood as a science of
studying how research is done scientifically.
The Research Methodology is to describe the research
procedure. This includes the overall Research Design and the Data Collection
methods. This selection is important because, it is hard to discuss
methodology without using technical terms

a) SOURCES OF DATA
This research study makes use of two sources of data namely Primary
data and Secondary data.
A) PRIMARY DATA
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Primary data refers to the data that does not exist already in records
and publications. Data collection was carried out using Personal interview
method guided by Structured Questionnaire.
B) SECONDARY DATA
Secondary data are which already collected by someone for some
purpose and are available for the present study secondary data are collected
by companies records and other libraries book. Secondary data can be used
as the basis of comparison with Primary data which has been collected by
questionnaire for interview.
Sources of Secondary Data
a) News paper.
b) Magazines
c) Website

ratio analysis of financial statement of Hitachi koki India


ltd.

The proposed chapter deal


with detail study of Ratio Analysis In HITACHI KOKI
INDIA Limited.
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DATA ANALYSIS AND INTERPRETATION :

The proposed chapter


deal with detail study of Ratio Analysis In HITACHI
KOKI INDIA Limited.

CONCLUSION AND SUGGESTION


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1) As the company has idle cash (indicated by quick ratio 1.08). It is

recommended to the company to invest the extra cash in stock trading


investments or choose for other investment avenues.

The inventory turnover is 99 days, which will be dearer to its effective


utilization of working capital. Hence the company has to adopt the two fold
strategy :
1. To promote more sales through its marketing department and
capture the unorganized sector of the markets, so that its finished goods
inventory turnover period is decreased.
2. To decrease its collection period by having a proper follow-up of
its creditors.

The company should try to increase its assets usage efficiency by


increasing its sales.

With respect to fixed assets I suggest to the company that the


utilization of the assets concerned would be planned as per the production
requirements and there by increasing the sales.

With respect to the debt collection policy, the company must make
sure that they adopt a policy of debt collection, which aims at increasing the
collection of book debts.

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BIBLIOGRAPHY

BOOKS

1. Financial Management
- M.Y Khan and P.K Jain
2. Financial Management
- I.M Pandey
3. Management Accounting
-P.K Sharma and Shashi K. Gupta

NET SITE
4. www.hitachi-koki.com

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