Abstract

In the context of this paper, first it introduces the importance of cash flow statement
and in the second section it tells the function of cash flow statements. And the most
important part is analysis of cash flow statements through several evaluation
methods. And at the last section , this paper conclude some problems which should
be focused on when analyzing cash flow statements. Key words: cash flow
statement, ratio, inflows, outflows, operating, investing, financing activities

In the light of the various problems of working capital management on

Indiabulls. We felt that the need for a detailed study of working capital management
with a view to investigate the cause of such problems, the personal or institutional
factors responsible for the amendments necessary. In the policy formulation and
implementation and the changes effective utilization of the resource employed. The
fundamental pricing underlying the investigation is to bring to fore the basic
managerial factors responsible for the inefficient in working capital management of
India Buls.

CONTENT:
Sl.No.

PAGE NO.

DESCRIPTION

CHAPTER I

INTRODUCTION

CHPATER II

COMPANY PROFILE

CHPATER III

REVIEW OF LITERATURE

CHAPTER IV

DATA ANALYSIS AND INTERPRETATION

CHAPTER V

CONCLUSIONS AND SUGGESTIONS

BIBILOGRAPHY

CHAPTER-1

INTRODUCTION

INTRODUCTION

Cash is the important current asset for the operations of the business. Cash is
the basic input needed to keep the business running on a continuous basis; it is also
the ultimate output expected to be realized by selling the service or product
manufactured by the firm.

Cash, the most liquid asset, is of vital importance to the daily operations of the
business. While the proportion of corporate assets held in the form of cash is very
small, often between 1and 3 percent. In the view of its importance, it is generally
referred as the life blood of business enterprise.
Cash Management is one of the key areas of working capital management.
Cash is the common denominator to which current asset can be reduced because
the other liquid assets are converted into cash.
Business analysts report that poor management is the main reason for
business failure. Poor cash management is probably the most frequent stumbling
block for entrepreneurs. Understanding the basic concepts of cash flow will help you
plan for the unforeseen eventualities that nearly every business faces.
Cash is ready money in the bank or in the business. It is not inventory, it is not
accounts receivable (what you are owed) , and it is not liquid asset these can
potentially be converted to cash ,but cant be used to pay suppliers, rent ,or
employees.

1.1 NATURE

 To provide the material frame work of budget and budgetary control.

To describe the profile of the organization as a backdrop for understanding a
study of budgetary control system.
To analyze the budgetary system in practice in India Bulls with particular
reference to their objectives and phase of organizational and re-appropriation.
In addition to the analysis of the industries budgetary system in practice in India

Bulls. The study aims at evaluation and modification to the budgetary systems
with reference to the various types of budgets. The scope in the formulation of
preference budget is also studied.

1.2 IMPORTANCE
In the light of the various problems of working capital management on
Indiabulls. We felt that the need for a detailed study of working capital management
with a view to investigate the cause of such problems, the personal or institutional
5

factors responsible for the amendments necessary. In the policy formulation and
implementation and the changes effective utilization of the resource employed. The
fundamental pricing underlying the investigation is to bring to fore the basic
managerial factors responsible for the inefficient in working capital management of
India Buls.

1.3 SOURCE OF DATA

The data of Indiabulls have been collected mainly from secondary sources viz.,

From the concerned officers of the India Bulls Limited

India Bulls Limited journals.
Accounting books, records
Statistical records

1.4 NEED OF THE STUDY

The statement of cash flows is one of the main financial statements. It organizes and
reports the cash generated and used in the following categories: operating activities,
investing activities, financing activities, supplemental information. It objectively
describes the expense and collection in one companys accounting period and cash
inflow and outflow from certain economic conditions.

1.5 OBJECTIVES OF THE STUDY

To present the conceptual framework relating to management of working

capital.

 To examine size of invest and turnover of working capital in an overall manner

including financing of current assets.
To know the inventory management practices of Indiabulls Limited with a
view to determine the extent of blocking up money inventory.
To assets the receivables management practices of Indiabulls Limited in term
of its size, turnover and collection polices.
To offer suitable suggestions for the efficient management of working capital
in Indiabulls Limited, keeping in view the in a deacies highlighted by the
study.

1.6 SCPOE OF THE STUDY

Since it will not be possible to conduct a micro level study of all level of
company performance, the study is restricted to Indiabulls Limited only.

1.7 METHODOLOGY
The proposed study is carried with the help of both primary and secondary
source of data.

PRIMARY DATA
The primary data is collected by interacting with the finance manager and
other concerned executed at office of the company.

SECONDARY DATA

All the secondary data used for the study has been extracted from the annual
reports, manuals and other published material of the company.

1.8 LIMITATION OF THE STUDY

The study is limited based on the data provides by the companys financial
statements. So the limitations of the statement are equally applicable of this

study.
The study is limited for a period of 5 years i.e., from 2010-2014.
The data collected is completely restricted to the company. Hence, this

analysis cannot be taken as universal.

The scope is limited to the financial statements of the company and is limited
to the financials, which have been published by the company and has been
taken as a representative of the study.

Detailed study of the topic is not possible due to the limited size of the project.

CHAPTER-3
INDUSTRY PROFILE

STOCK MARKET HISTORY

The World's Market - Stock Market History:
When people talk about the Stock Market, it's no always immediately clear what they're
referring to. Is the Stock Market a place? Or is it something different? To many people it is an
abstract idea. They buy stocks in "the stock market" without ever leaving the comfort of their
computer terminal. But the stock market is indeed a physical place with buildings and
addresses, a place you can go visit.
10

Wall Street is the Place, were many folks think of Wall Street and the Stock Market as one in
the same, and that view isn't really far from the truth. Wall Street is the place where it all
started and where the world's largest financial market was born and prospered. From Wall
Street sprang a new industry with its own language and terminology.

The History:
Wall Street can trace its name back to 1653. Originally it was set up for defense and not for
commerce. Settlers of Dutch descent, who were always on the lookout from attacks by Native
Americans and the British built a 12 foot stockade fence. Little did they know that this fence
would go on to become the center of financial activity in the world. The wall lasted a good
while, until 1685. At that point the wall was torn down and a new street was built. The British
called it Wall Street.

11

Out of these major stock exchanges were:

NSE
The National Stock Exchange of India Limited has genesis in the report of the High
Powered Study Group on Establishment of New Stock Exchanges, which recommended
promotion of a National Stock Exchange by financial institutions (FIs) to provide access
to investors from all across the country on an equal footing. Based on the
recommendations, NSE was promoted by leading Financial Institutions at the behest of
the Government of India and was incorporated in November 1992 as a tax-paying
company unlike other stock exchanges in the country. On its recognition as a stock
exchange under the Securities Contracts (Regulation) Act, 1956 in April 1993, NSE
commenced operations in the Wholesale Debt Market (WDM) segment in June 1994. The
Capital Market (Equities) segment commenced operations in November 1994 and
operations in Derivatives segment commenced in June 2000
NSE's mission is setting the agenda for change in the securities markets in India. The
NSE was set-up with the main objectives of:

Establishing a nation-wide trading facility for equities and debt instruments.

Ensuring equal access to investors all over the country through an appropriate
communication network.

Providing a fair, efficient and transparent securities market to investors using

electronic trading systems.

Enabling shorter settlement cycles and book entry settlements systems, and

Meeting the current international standards of securities markets.

The standards set by NSE in terms of market practices and technology, have become
industry benchmarks and are being emulated by other market participants. NSE is more
than a mere market facilitator. It's that force which is guiding the industry towards new
horizons and greater opportunities.

12

13

BSE
The Stock Exchange, Mumbai, popularly known as "BSE" was established in 1875 as "The
Native Share and Stock Brokers Association". It is the oldest one in Asia, even older than the
Tokyo Stock Exchange, which was established in 1878. It is a voluntary non-profit making
Association of Persons (AOP) and is currently engaged in the process of converting itself into
demutualised and corporate entity. It has evolved over the years into its present status as the
premier Stock Exchange in the country. It is the first Stock Exchange in the Country to have
obtained permanent recognition in 1956 from the Govt. of India under the Securities
Contracts (Regulation) Act 1956.The Exchange, while providing an efficient and transparent
market for trading in securities, debt and derivatives upholds the interests of the investors and
ensures redresses of their grievances whether against the companies or its own memberbrokers. It also strives to educate and enlighten the investors by conducting investor
education programmers and making available to them necessary informative inputs.
A Governing Board having 20 directors is the apex body, which decides the policies and
regulates the affairs of the Exchange. The Governing Board consists of 9 elected directors,
who are from the broking community (one third of them retire ever year by rotation), three
SEBI nominees, six public representatives and an Executive Director & Chief Executive
Officer and a Chief Operating Officer

The Rise of the Stock Exchanges:

What helped Wall Street rise to pre-eminence was the emergence of two great Stock
Exchanges, which gave order to the chaotic trading and gave birth to the financial markets as
we know them today.
The year was 1790. The place was Philadelphia. The occasion was the founding of the first
stock exchange in America. Two years later a group of New York merchants met to discuss
how to take command of the securities business. The merchants, a group of 24 men, founded
what is now known as the New York Stock Exchange. But in early 1817, the merchant group
from New York, distressed at the sorry state of their stock exchange, sent a representative to
Philadelphia to observe how things were being done. Upon arriving with news about the
robust exchange in Philadelphia, the New York Stock and Exchange Board was soon formally
organized.

14

The exchange opened up shop on Wall Street. As for the New York Stock Exchange, it has
since moved past its humble beginnings to the point where its system now facilitates billions
of dollars worth of trades each day. But there was a gradual build up to this sort of status. In
the early 1900s massive amounts of money were made on Wall Street. But the boom period
could not be sustained indefinitely. And in 1929 this principle came front and center as the
stock market crash of 1929 seared the national.nay, global. Psyche and triggered what was to
be called the Great Depression.
While many of the powers that be realized that the markets could not sustain a boom forever,
very few publicized this view, choosing instead to let the market be its own judge, jury and
executioner. As a result of the laissez-faire attitude, many people. Rich and Poor alike. Lost a
lot of money.
But the stock market crash of 1929 was just the beginning of sorrows for Wall Street. For
while the economy eventually recovered from its catastrophic losses, the market excesses that
had factored into the crash in the late 1920s seeped back into the picture. The result was the
stock market crash of 1987, which saw the Dow Jones suffer what was the largest single-day
loss in the stock markets history.
Since then, the government and the industry have tried to put measures in place to curtail, if
not entirely eliminate, the possibility of such a large-scale crash. The stock markets are now
an integral part of the global economy, and so proper safeguards to reduce the risks of another
disastrous crash are necessary.
But while efforts have been made to reduce the risk, the possibility for another stock market
crash can never be ruled out.

Current Stock Market:

The current "stock market" is comprised of 300,000 computers situated on pro trader's desks.
These computers are networked together using sophisticated protocols. This level of
information sharing makes pricing an almost exact science.
These 300,000 computers are further linked to another 26 million computers worldwide.
These computers are located in banks, small businesses, and large corporations. These
computers comprise the banking networks which make computerized transactions possible.

15

Finally, these computers are connected to another 300 million+ computers which connect and
disconnect from the financial markets daily. In New York City alone, these transactions
amount to over $2.2 trillion dollars daily

Trends of stock market

Markets Crash! Dow Jones Falls 500 Points
At this point in time, it seems like the Dow Jones Industrial Average (the main stock index) is
falling off in record losses every day. Its almost a weekly habit that we see the biggest
decline in history in the markets, only to have this loss dwarfed by next weeks action. Lets
face it; we are in bear market territory. As we continue to feel the brunt of a global market
slowdown dont expect things to improve any time soon. We may see this news trend for
quite some time.
2. Commodities are the Next Bull Market: The first two quarters of the 2008 fiscal year
proved to be stellar for anything and everything tied to commodities, the third quarter was
anything but. Although we were seeing some record levels in the price of crude oil, natural
gas and gold in 2008, it would seem that now all those profits have been erased and then
some! As things continue to fall, we get analysts calling for the next bull market in oil or
another commodity like wheat or ethanol. Its one of the most popular themes, and one of the
biggest pitfalls you need to avoid as an investor.
3. Blue Chips Produce: Superior Earnings Numbers if you are an investor, you have probably
heard time and time again that you NEED to be in a massive company in order to reduce your
portfolio risk. This is actually not true at all. Granted, in most cases a large company will
move less and is less likely to go bankrupt. However, the true risk of a company is on its
balance sheet and its volatility in trading hours. Weve seen massive companies that were
too big to fail go bankrupt, namely banks like Lehman Brothers and Wachovia. Dont
always believe that these blue chip big boys are going to save you from loss.
4. Ben Bernanke and Federal Reserve: In Talks to Cut Rates as our overall economy spirals, a
lot of focus has been put on Ben Bernanke and Henry Paulson. The Federal Reserve and the
U.S. Treasury are in the international spotlight as American financial systems are now a
gauge for the global economy. Almost every time the market takes a hit, there is a new
16

discussion of the Fed cutting rates or making borrowing cheaper in laymans terms. Maybe
talks between the Fed and the U.S. Treasury to put together bailout plans and rate cuts are
over-emphasized so keep a skeptical eye out!
5. United States Meltdown has Become Global:
Globalization is real, and weve seen this firsthand as the United States recession has now
spread into international markets. The Asian and European indices now track what the U.S.
exchanges are doing, and act accordingly. When we had a +1000 point day, Asian markets
took off. This may not happen the other way around all the time, but we can clearly see that
the American markets have adversely affected the overall investing conditions. Its a scary
time out there, so be sure that you know where your money is and make sure to diversify
your risk to enhance your returns.
6. Financials Underwrite Massive Amounts of Debt everyone is scrambling for liquid assets,
bottom line. Anything that is close to cash is in high demand nowadays and the financial
companies of the world have begun to look for potential lenders o that they can get some debt
off their books. When banks take out loans, they are in effect gambling that they will get
reimbursed in the future. With things like sub-prime home mortgage loans, this doesnt
always happen. When markets began turning on banks, debt became un payable and
financial institutions had to start underwriting the bad bookings to clear their balance sheets.
This has continued for about a year to this point, and the trend is not going to reverse any
time soon as European and Asian economies start to struggle.
7. Foreign Exchange Markets Heat up:
So what is the deal with Forex? Forex, or the Foreign Exchange, is the global exchange
market for currency. You can trade spreads between economies by using the countrys
currency (e.g. U.S. Dollar, Euro, Japanese Yen, Chinese Juan) and trading them based on
strength. Foreign exchange markets have really heated up as of late, as they are a place of
relative safety when put in comparison to the stock market. The difference between the two is
that in Forex, there is a winner and a loser. In the stock market, everyone can win and
everyone can lose right now the latter is more true. Because of this obvious win-lose
payoff, Forex can be used to make money betting effectively between currencies even in a
bad market!
1. Worldwide Consolidation Has M&A Activity reeling:
17

As global markets continue to struggle in dealing with credit problems and consumer
spending cuts, it is important to keep an eye on the consolidating markets. This may be more
obvious in the financial companies, as many banks are being bought out and acquired by
stronger firms. As competition dwindles and the weak companies are pushed out of the
marketplace, we have an area where mergers and acquisitions (M&A) are alive and well.
When things are cheap, more things are bought so maybe the financial turmoil isnt always
a negative thing if you are a large multinational corporation.
9. Emerging Markets Boost Growth Overseas:
While 2007 may have been the year of growth in China, many of these popular growth
havens have been picked apart by an international market slowdown sparked by the United
States economy. How far can these markets fall? If you are in the camp that would believe
these economies are performing up to expectation, place some speculative bets into emerging
economy tied companies like those invested heavily in Brazil and India. You may be in for
some monster gains once things turn around.
10. Crude Oil and Natural Gas Stage Big Movements:
Going with the commodity theme, it seems that high/low crude oil is mentioned every day.
Ever since crude prices per barrel jumped to $145 people have been freaking out about what
is going to happen next. Even as crude has now fallen to $80, nearly half of where it once
was, people are still very concerned with the moves in crude oil and natural gas. The
argument is still alive and well with which is the better commodity, but both energy plays can
be an excellent hedge to a flailing market. Keep an eye on the trends in stock market news
that talk about moves in the energy commodities, and you may find yourself ahead!
We want to thank you for checking out BullishBankers.com. With a chance to out-perform
the research firms that charge you high fees to see the same quality investment rationale we
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subscribe to our feed to stick with the best bulls on the Street!

Future outlook:
The views expressed below are the opinions of the author based on the principles of technical
analysis, a science that has been tested and proven for more than hundred years. The views
are unbiased and informative in nature. These do not constitute an offer to buy or sell stocks.
18

Every effort has been made by the author to ensure correctness of the information presented.
The author cannot be held responsible for omissions, mistakes etc.
Investing or trading in stock markets is a high risk activity. Those who cannot afford to risk
their money should refrain from dealing in stocks.
The author has no vested interest in any of the stocks mentioned. He and/or his close
associates may or may not be having positions at the time of writing this article.
The reader needs to understand that this article is purely for informative purposes only and all
transactions, if entered into by him will be solely at his risk. The author does not guarantee
that the projected targets will be achieved within the stipulated time frame.
Source for the price data displayed in graphics and tables:
National Stock Exchange of India Limited, Mumbai, India (www.nseindia.com)

What is the reason behind this huge rise in index?

Like all other financial markets, Indian markets are also governed by the fundamental
principles of demand and supply gap. When interest rates were lowered, stock market looked
an attractive option and investors began to look for opportunities. Huge foreign funds are
another reason for the upsurge. Liquidity is one more factor one can easily transact with a
click of a mouse unlike the old days when physical share certificates were in use.
Whatever be the reason behind any move, it is always reflected in the charts. All other
factors, namely, business conditions, economy growth etc. are always discounted when
analyzing the market technically.
How many stocks got benefited from this nearly fivefold rise in index in the last 4 years? Let
us analyze some of the index stocks.

19

* Adjusted Close 1 due to stock split / bonus / rights issue

** Close 1 as on 31/07/2004
*** Close 1 as on 31/08/2003
It can be seen from the above table that not all the index stocks have performed in the same
manner. ABB, BHARTIARTL and SAIL have outperformed when compared to the overall
index.
It should be noted here, that the performance in stock market by scrip has nothing to do with
the financial performance of the company. It just implies that the investors have chased this
stock more strongly compared to the rest.
We can see no direct relationship between the overall index performance and the individual
stocks performance. This indicates the demand and supply gap scenario for the stocks
discussed.
What could be the reason for the uneven performance?
The price of a particular stock on a given day is decided by the market participants. They are
FIIs or the foreign institutional investors
FIs or the financial institutions

20

MFs or the mutual funds

Long term investors
Medium term investors
Short term investors
Day traders
Speculators
Punters
Derivative traders
When thousands of people are trading a particular stock, no one can be very clear of what the
other trader thinks. This leads to volatility and uncertainty in the markets.
When one person buys a stock, obvious reason is that he thinks that it will go up. The person
who sold the stock thought that it would either go down or he had enough profit or loss.
In a complex scenario like this, price fluctuations happen regularly. The investor needs to
take advantage of the situation by buying when the demand just starts picking up for the stock
and sell when it just starts diminishing.
Having said that it is difficult for an ordinary investor to completely understand and assess
the market status. What can the investor do now?
Ideally, one would like to take some money home. If one has remained a long term investor
and likely to get some profit, he can book it.
Remember that the chance of the profit going down may increase with the time a stock being
held.

Some thoughts on investing in stocks:

Not too many people understand the stock market dynamics. So take professional advice,
consult a qualified and experienced person. He may charge you a little, but it is worth taking
the risk than worrying later.
Invest the amount that you can afford to lose. There are only probabilities, no certainties in
financial markets. Keep doing your research. Observe prices at least once a week. If you
think you gained a reasonable amount, book your profits at least partially. Last but not least,
never borrow money to invest in stocks thinking that prices will always go up!
21

CHAPTER-3

COMPANY PROFILE

About us
22

INDIABULLS
Indiabull

Type
Traded as
Industry

Public company
NSE: INDIABULLS
BSE: 532544
Financial Services,

Real

Estate,

Power
Founded
May, 2000
Headquarters
Gurgaon, India[1]
Sameer Gehlaut, Chairman & CEO,
Key people

Products
Website

Rajiv Rattan, Vice Chairman, Saurabh

Mittal, Vice Chairman
Securities,
Consumer

Finance,

Mortgages, Real Estate

www.Indiabulls.com

ABOUT US

In middle of 1999, when e-commerce was just about starting in India, Sameer Gehlaut and
his close IIT Delhi friend Rajiv Rattan got together and bought a defunct securities company
with a NSE membership and started offering brokerage services. A Few months later, their
friend Saurabh Mittal also joined them. By December 1999, the company embarked on its
journey to build one of the first online platforms in India for offering internet brokerage
services. In January 2000, the 3 founders incorporated Indiabulls Financial Services and
made it as the flagship company.
In mid 2000, Indiabulls Financial Services received venture capital funding from Mr L.N.
Mittal & Mr Harish Fabiani. In late 2000, Indiabulls Securities, a subsidiary of Indiabulls
Financial Services started offering online brokerage services and simultaneously opened
physical offices across India. By 2003, Indiabulls securities had established a strong pan India
presence and client base through its offices and on the internet.
23

In September 2004, Indiabulls Financial Services went public with an IPO at Rs 19 a share.
In late 2004, Indiabulls Financial Services started its financing business with consumer loans.
In March 2005, Indiabulls Properties Private Ltd, a subsidiary of Indiabulls Financial
Services, participated in government auction of Jupiter Mills, a defunct 11 acre textile mill
owned by NTC in Lower Parel, Mumbai. Indiabulls Properties private Ltd won the mill in
auction and that purchase started Indiabulls real estate business. A few months later,
Indiabulls Real Estate company pvt ltd bought Elphinstone mill in Lower Parel, another
textile mill auctioned by NTC.
With real estate business gaining size, Indiabulls Financial Services demerged the real estate
business under Indiabulls Real Estate and each shareholder of Indiabulls Financial Services
received additional share of Indiabulls Real Estate through the demerger. Subsequently,
Indiabulls Financial Services also demerged Indiabulls Securities and each shareholder of
Indiabulls Financial Services also received a share of Indiabulls Securities.
In year 2007, Indiabulls Real Estate incorporated a 100% subsidiary, Indiabulls Power, to
build power plants and started work on building Nashik & Amrawati thermal power plants.
Indiabulls Power went public inSeptember 2009.
Today, Indiabulls Group has a networth of Rs 19,320 Crore & has a strong presence in
important sectors like financial services, power & real estate through independently listed
companies and Indiabulls Group continues its journey of building businesses with strong cash
flows.

CHAIRMANS DESK
Sameer Gehlaut
Chairman, Indiabulls Group
Sameer Gehlaut has been the chairman of Indiabulls Group since inception. He is also the
chairman of major Indiabulls companies: Indiabulls Power, Indiabulls Housing Finance &
Indiabulls Real Estate. Under his leadership, Indiabulls Group has grown in scale and size to
a business house with strong businesses in various sectors.
24

Mr Gehlaut started Indiabulls Group after working briefly with Halliburton before returning
to India. Mr Gehlaut received a B.Tech degree in Mechanical Engineering from Indian
Institute of Technology, Delhi.

MANAGEMENT TEAM
Indiabulls Group

Mr Rajiv Rattan - Vice Chairman

Mr Saurabh Mittal - Vice Chairman

Mr Ashok Kacker - Group President

Mr Ashok Sharma - Group CFO

Mr Ajit Mittal - Group Director

Mr Gurbans Singh - Group Director

Mr Tejinderpal Singh Miglani - Group CIO

Indiabulls Housing Finance Limited

Mr Gagan Banga - CEO

Mr Ashwini Kumar Hooda - DMD

Indiabulls Real Estate Limited

Mr Narendra Gehlaut - MD
Indiabulls Power Limited

Mr Rajendra Kumar Sugandhi - CEO

Mr Mehul Johnson - President

Indiabulls Securities Limited

Mr Divyesh Shah - CEO

Mr Vijay Babbar - DMD

25

BUSINESSES
Indiabulls Group is one of the country's leading business houses with business interests in
Power, Financial Services, Real Estate and Infrastructure. Indiabulls Group companies are
listed in Indian and overseas financial markets. The Net worth of the Group is Rs 19,320
Crore and the total planned capital expenditure of the Group by 2013-14 is Rs 35,000 Crore.
Indiabulls Power currently developing Thermal Power Projects with an aggregate capacity
of 5400 MW. The first unit is expected to go on stream in Dec 2012. The net worth of
Indiabulls Power is Rs 5,507 Crore. The company has a total capital expenditure of Rs 27,500
Crore. The company has been assigned 'BBB' rating.
Indiabulls Housing Finance Ltd. (IBHFL) is Indias 3rd largest Housing Finance Company
(HFC). The company is registered as a Housing Finance Company (HFC) and is regulated by
the National Housing Bank (NHB). IBHFL is a leading provider of home loans, loan against
properties and commercial vehicle loans.
The company has a loan asset book of over Rs. 34,400 Cr and has, since inception, disbursed
over Rs. 71,000 Cr to over 5.5 lakh customers. With a net worth of over Rs. 5,300 Cr, IHFL is
one of the best capitalized companies amongst its peer with a CRAR of 18.47% as at March
31st, 2013. Further, the company is one of the least levered amongst its peer set with a net
debt-to-equity ratio of only 4.67. The company enjoys a credit rating of AA+.
IBHFL has 200 well appointed and customer accessible walk-in branches spread across the
country. Companys national and International reach is further enhanced from tie-ups with
Yes Bank and Doha Bank.
Indiabulls Real Estate is among India's top Real Estate companies with development
projects spread across residential complexes, integrated townships, commercial office
complexes, hotels, malls, Special Economic Zones (SEZs) and infrastructure development.
Indiabulls Real Estate partnered with Farallon Capital Management LLC of USA to bring the
first FDI into real estate in the country. The company has a networth of Rs 7,403 Crore and
has purchased prime land, mostly in the metros and other Tier 1 cities worth Rs 4,000 Crore
in government auctions alone. Indiabulls Real Estate is currently developing 72.86 million
sqft into premium quality, high-end commercial, residential and retail spaces. The company
has been assigned 'A+' rating.
26

Indiabulls Securities is one of India's leading capital markets companies providing securities
broking and advisory services. Indiabulls Securities also provides depository services, equity
research services and IPO distribution to its clients and offers commodities trading through a
separate company. These services are provided both through on-line and off-line distribution
channels. Indiabulls Securities is a pioneer of on-line securities trading in India. Indiabulls
Securities in-house trading platform is one of the fastest and most efficient trading platforms
in the country. Indiabulls Securities has been assigned the highest rating BQ-1 by CRISIL.

INDIABULLS FOUNDATION
India has witnessed an economic transformation over the past two decades, translating into
higher incomes, better educational opportunities, improved infrastructure, a dynamic private
sector, and leadership in the global community. We have much to be proud of.
But we also recognize that we have a long way to go. Over 700 million people live under $2 a
day. Learning levels in schools remain abysmally low, and most of our rural population does
not have access to basic health care, regular electricity, clean water, and sanitation. India has
some of the worlds worst statistics on basic development indicators such as malnutrition,
infant mortality, and gender discrimination.
As a society, we are at the confluence of accelerated economic progress and extreme
deprivation. As corporate citizens, we at Indiabulls are conscious of the opportunities and the
responsibility that this confluence presents and are keen to help in building an inclusive
society.
One of the first initiatives of Indiabulls Foundation is to support the development of rural
districts. We have initiated a few pilot projects in Rajasthan with an open collaborative
approach which leverages the efforts of local stakeholders for a robust and scalable structure.
Over time, as we understand the effectiveness of these pilots, we will expand them further.
Some of these pilot projects are in rainwater harvesting, groundwater management, tree
plantation, IT projects for rural development, income generation support for rural women,
27

skills training for rural youth, conducting eye camps for rural schoolchildren and in trying to
be of support to traditional artisans.

FINANCIALS:
Total Group Networth Rs. 19,335 Cr
Total Group PAT for FY 12-13 Rs. 1,454 Cr.
Total Group Capital Expenditure Rs. 6,200 Cr. (US $ 1.2 bn.) capex in FY 1011. Planned capex of Rs. 29,000 Cr (US $ 5.7 bn.) by FY 2014-15.
Focus on Execution and on ground results translating into profits.
For its ongoing projects Indiabulls Group consumes 385 MT of Steel, 550
MT of Cement & 1,700 CUM of RMC on daily basis.
Creating Value for Shareholders Dividend payout of Rs. 913 Cr. in FY 12-13

28

Investors

Statement of unclaimed and unpaid amounts

Indiabulls Group Presentation

Code Of Conduct for Board Members and Senior Management

Shareholding Pattern of Indiabulls Power Limited. as on 30 th June 2012

QUERIES
Kubeir Khera
Indiabulls House, Indiabulls Finance Centre,
Senapati Bapat Marg, Parel West, Mumbai - 400 013
Phone: +91 22 61899400 | Fax: +91 22 61899400
Email: khera@indiabulls.com

29

CHAPTER-3

REVIEW OF LITERATURE

30

CASH FLOW

Cash flow is the movement of cash into or out of a business, project, or financial
product. It is usually measured during a specified, finite period of time. Measurement
of cash flow can be used

to determine a project's rate of return or value. The time of cash flows into and
out of projects are used as inputs in financial models such asinternal rate of
return, and net present value.

to determine problems with a business's liquidity. Being profitable does not

necessarily mean being liquid. A company can fail because of a shortage of cash,
even while profitable.

as an alternate measure of a business's profits when it is believed that accrual

accounting concepts do not represent economic realities. For example, a
company may be notionally profitable but generating little operational cash (as
may be the case for a company that barters its products rather than selling for
cash). In such a case, the company may be deriving additional operating cash by
issuing shares, or raising additional debt finance.

cash flow can be used to evaluate the 'quality' of Income generated byaccrual
accounting. When Net Income is composed of large non-cash items it is
considered low quality.

to evaluate the risks within a financial product. E.g. matching cash

requirements, evaluating default risk, re-investment requirements, etc.

Cash flow is a generic term used differently depending on the context. It may be
defined by users for their own purposes. It can refer to actual past flows, or to
projected future flows. It can refer to the total of all the flows involved or to only a
subset of those flows. Subset terms include 'net cash flow', operating cash
flow and free cash flow.
31

Statement of cash flow in a business's financials

The (total) net cash flow of a company over a period (typically a quarter or a full
year) is equal to the change in cash balance over this period: positive if the cash
balance increases (more cash becomes available), negative if the cash balance
decreases. The total net cash flow is the sum of cash flows that are classified in
three areas:
1. Operational cash flows: Cash received or expended as a result of the
company's internal business activities. It includes cash earnings plus changes
to working capital. Over the medium term this must be net positive if the
company is to remain solvent.
2. Investment cash flows: Cash received from the sale of long-life assets, or
spent on capital expenditure (investments, acquisitions and long-life assets).
3. Financing cash flows: Cash received from the issue of debt and equity, or paid
out as dividends, share repurchases or debt repayments.

Ways Companies Can Augment Reported Cash Flow

Common methods include:

Sales - Sell the receivables to a factor for instant cash. (leading)

Inventory - Don't pay your suppliers for an additional few weeks at period end.
(lagging)

32

Sales Commissions - Management can form a separate (but unrelated)

company and act as its agent. The book of business can then be purchased
quarterly as an investment.

Wages - Remunerate with stock options.

Maintenance - Contract with the predecessor company that you prepay five
years worth for them to continue doing the work

Equipment Leases - Buy it

Rent - Buy the property (sale and lease back, for example).

Oil Exploration costs - Replace reserves by buying another company's.

Research & Development - Wait for the product to be proven by a start-up lab;
then buy the lab.

Consulting Fees - Pay in shares from treasury since usually to related parties

Interest - Issue convertible debt where the conversion rate changes with the
unpaid interest.
Taxes - Buy shelf companies with TaxLossCarryForward's. Or gussy up the

purchase by buying a lab or O&G explore co. with the same TLCF

Cash Flow Management

By: Dr. William R. Osgood
Cash - the organization's most precious asset. Control your cash before it controls
you.
Cash flow management is a problem for almost any firm, large or small. The
worst symptom of the problem: the business runs out of cash. Watching a business
33

floundering, running out of cash even as it makes great sales and profits is painful.
Painful though it may be, it is common and repeatedly the cause of business failure.
Small businesses are especially vulnerable to cash flow problems since they
frequently operate with inadequate cash reserves or none at all and, worse, tend to
miss the implications of a negative cash flow until it's too late. However, even in
larger organizations, the departmental or strategic business unit (SBU) budget is
often as rigid - exceed your spending budget and you are out of business as well.

For financing purposes, cash flow projections are generally the most crucial
aspect of the business plan. Bankers and other outside financing intermediaries will
almost always look for a cash flow analysis in preference to any other financial
statement, because this will show how the loan can be repaid. In larger companies,
the cash budget for a new project or expansion is critical to the overall decision to
commit funds and move forward..
Why is cash flow so important? If the cash inflows exceed the cash outflows, the
business can continue operations. If the cash outflows exceed the inflows, the

34

business RUNS OUT OF CASH and grinds to a halt. Even if the imbalance is only
for a short period, it can spell disaster.
In its simplest form, cash flow refers to the flows of cash, literally, into and out
of the business. Think in terms of actual cash, dollar bills, flowing in and out of the
business, and then identify both their sources and uses. This is cash-flow analysis.

CASH FLOW

35

TIMING and cash flow are inseparable. Payments to suppliers are typically
expected often even before customers of the business pay their bills. As a result, the
operation is very likely to have a negative cash flow when it grows dramatically.
Periods of change are always reflected in an altered cash flow. If sales fall off, the
cash flow slows down. Interestingly enough even if sales increase, the cash flow
may stop completely or even become negative (more out than in). Think of the
impact of credit sales on cash flow, for example. One-time events such as population
shifts or changes in competition could trigger such consequences. More commonly,
seasonal fluctuations of the business may also pose cash flow problems where a
36

build-up of inventories must precede the sales cycle (such as a toy business prior to
the Christmas holidays).
Whatever the cause, the underlying message is simple: Run out of cash and
the business is in trouble. Even if it is possible to raise more money from other
sources, sooner or later the timing of cash inflows must match the outflows if the
business is to survive.
How to get cash flow under control? It's not easy. Some businesses never
achieve cash flow control. These businesses are always in trouble, chronically
overdrawn, slow in paying bills, and will eventually fold. They fold though, only after
their owner/managers have spent a great deal of time worrying and probably spent
all of their personal assets trying to cover the operating deficits. This kind of
complication need not be an integral part of business management. Instead it is
essential to PLAN and SCHEDULE so that cash flow for the business is positive

37

38

Cash flow management does not need to be mysterious or complex. Managing

cash is all about timing the inflows and outflows. Cash Flow Analysis starts the
process. This can be as simple as going to your check book or accounting system
and analyzing your receipts and disbursements over the past few months. A pattern
is likely to emerge. What are the revenue sources, and how consistent are they from
month to month? As well, what are the expenditures, and how repeatable are they
from month to month? Next, look at the incoming revenue stream (Accounts
Receivable) or your sales forecast to confirm and further predict cash inflows, and
your Accounts Payables to build a pattern of required future disbursements. Match
the two. Is there a positive or negative cash flow?
If there is a negative cash flow, the deficit needs to be covered from somewhere.
There are two options. Spend less, or get more (increase revenues). Even it the
cash flow is positive, inspecting the individual elements may further improve
operations. Are there cash inflows or outflows that can be changed?

The balance sheet, income statement, and cash flow statement are the three
generally accepted financial statements used by most businesses for financial
reporting. All three statements are prepared from the same accounting data, but
each statement serves its own purpose. The purpose of the cash flow statement is
to report the sources and uses of cash during the reporting period.

39

Structure of the Cash Flow Statement

The most commonly used format for the cash flow statement is broken down
into three sections: cash flows from operating activities, cash flows from investing
activities, and cash flows from financing activities.
Cash flows from operating activities are related to your principal line of business and
include the following:

Cash receipts from sales or for the performance of services

Payroll and other payments to employees

Payments to suppliers and contractors

Rent payments

Payments for utilities

Tax payments

Investing activities include capital expenditures disbursements that are not

charged to expense but rather are capitalized as assets on the balance sheet.
Investing activities also include investments (other than cash equivalents as
indicated below) that are not part of your normal line of business. These cash flows
could include:

Purchases of property, plant and equipment

Proceeds from the sale of property, plant and equipment

40

Purchases of stock or other securities (other than cash equivalents)

Proceeds from the sale or redemption of investments

Financing activities include cash flows relating to the businesss debt or equity
financing:

Proceeds from loans, notes, and other debt instruments

Installment payments on loans or other repayment of debts

Cash received from the issuance of stock or equity in the business

Dividend payments, purchases of treasury stock, or returns of capital

Cash for purposes of the cash flow statement normally includes cash and cash
equivalents. Cash equivalents are short-term, temporary investments that can be
readily converted into cash, such as marketable securities, short-term certificates of
deposit, treasury bills, and commercial paper. The cash flow statement shows the
opening balance in cash and cash equivalents for the reporting period, the net cash
provided by or used in each one of the categories (operating, investing, and
financing activities), the net increase or decrease in cash and cash equivalents for
the period, and the ending balance.
There are two methods for preparing the cash flow statement the direct
method and the indirect method. Both methods yield the same result, but different
procedures are used to arrive at the cash flows.

41

Direct Method
Under the direct method, you are basically analyzing your cash and bank
accounts to identify cash flows during the period. You could use a detailed general
ledger report showing all the entries to the cash and bank accounts, or you could use
the cash receipts and disbursements journals. You would then determine the
offsetting entry for each cash entry in order to determine where each cash
movement should be reported on the cash flow statement.
Another way to determine cash flows under the direct method is to prepare
a worksheet for each major line item, and eliminate the effects of accrual basis
accounting in order to arrive at the net cash effect for that particular line item for the
period. Some examples for the operating activities section include:
Cash receipts from customers:

Net sales per the income statement

Plus beginning balance in accounts receivable

Minus ending balance in accounts receivable

Equals cash receipts from customers

Cash payments for inventory:

42

Ending inventory

Minus beginning inventory

Plus beginning balance in accounts payable to vendors

Minus ending balance in accounts payable to vendors

Equals cash payments for inventory

Cash paid to employees:

Salaries and wages per the income statement

Plus beginning balance in salaries and wages payable

Minus ending balance in salaries and wages payable

Equals cash paid to employees

Cash paid for operating expenses:

Operating expenses per the income statement

Minus depreciation expenses

Plus increase or minus decrease in prepaid expenses

Plus decrease or minus increase in accrued expenses

43

Equals cash paid for operating expenses

Taxes paid:

Tax expense per the income statement

Plus beginning balance in taxes payable

Minus ending balance in taxes payable

Equals taxes paid

Interest paid:

Interest expense per the income statement

Plus beginning balance in interest payable

Minus ending balance in interest payable

Equals interest paid

Under the direct method, for this example, you would then report the following in the
cash flows from operating activities section of the cash flow statement:

44

Cash receipts from customers

Cash payments for inventory

Cash paid to employees

Cash paid for operating expenses

Taxes paid

Interest paid

Equals net cash provided by (used in) operating activities

Similar types of calculations can be made of the balance sheet accounts to eliminate
the effects of accrual accounting and determine the cash flows to be reported in the
investing activities and financing activities sections of the cash flow statemen

Indirect Method
In preparing the cash flows from operating activities section under the indirect
method, you start with net income per the income statement, reverse out entries to
income and expense accounts that do not involve a cash movement, and show the
change in net working capital. Entries that affect net income but do not represent

45

cash flows could include income you have earned but not yet received, amortization
of prepaid expenses, accrued expenses, and depreciation or amortization. Under
this method you are basically analyzing your income and expense accounts, and
working capital. The following is an example of how the indirect method would be
presented on the cash flow statement:

Net income per the income statement

Minus entries to income accounts that do not represent cash flows

Plus entries to expense accounts that do not represent cash flows

Equals cash flows before movements in working capital

Plus or minus the change in working capital, as follows:

o An increase in current assets (excluding cash and cash equivalents)

would be shown as a negative figure because cash was spent or
converted into other current assets, thereby reducing the cash balance.
o A decrease in current assets would be shown as a positive figure,
because other current assets were converted into cash.
o An increase in current liabilities (excluding short-term debt which would
be reported in the financing activities section) would be shown as a
positive figure since more liabilities mean that less cash was spent.
o A decrease in current liabilities would be shown as a negative figure,
because cash was spent in order to reduce liabilities.
46

The net effect of the above would then be reported as cash provided by (used in)
operating activities.
The cash flows from investing activities and financing activities would be presented
the same way as under the direct method.

47

CHAPTER 4

DATA ANALYSIS

Cash flow statement as an year ended 31 st march,2013 and

2014.
India Bulls
48

Cash Flow

Net Profit Before Tax

Net Cash From Operating Activities
Net Cash (used in)/from Investing
Activities
Net Cash (used in)/from Financing
Activities
Net (decrease)/increase In Cash and
Cash Equivalents
Opening Cash & Cash Equivalents
Closing Cash & Cash Equivalents

In Cr.
Mar '14

Mar '13

12 mths

12 mths

932.37

790.87

-1213

-5888

-863.2

797.92

2532.9

9227.5

457.12

4137.4

4426.9

289.43

INTERPRETATION
Observed the above table that the net profit before tax is 790.87 cr in the year
2013.
49

It is increased to 932.37 cr in the year 2014.

Net cash from investing Activities is 797.92 cr in the year 2013 it decreased to
(863.21) cr in 2014.
Net decrease/increase in cash and cash Equivalents is 9227.52 cr in the year
2014. It decreases to (2532.88).
Opening cash is decreases compares to 2013. Is 4137.44 to 457.12 cr.
Closing cash is 4426.87 in the year ended 2014.

CASH FLOW STATEMENT as an year ended 31 st March, 2013 and

2012.

India Bulls
Cash Flow

In Cr.
Mar
'13

50

Mar
'12

Net Profit Before Tax

Net Cash From Operating Activities
Net Cash (used in)/from Investing Activities
Net Cash (used in)/from Financing Activities
Net (decrease)/increase In Cash and Cash Equivalents
Opening Cash & Cash Equivalents
Closing Cash & Cash Equivalents

INTERPRETATION

51

12
mths
790.8
7

12
mths
394.2
5

-5888

-2914

797.9
2

509.4
1

9227.
5

1334.
7

4137.
4

-1070

289.4
3

1359.
7

 Observed the above table that the net profit before tax is 394.25 cr in the year
2012.
It is increased to 790.87 cr in the year 2013.
Net cash from investing Activities is 509.41 cr in the year 2012 it increased to
787.92 cr in 2013.
Net decrease/increase in cash and cash Equivalents is 1334.73 cr in the year
2012. It increases to 9227.52 cr in 2013.
Opening cash is increases compares to 2012. Is -1070.20 to 4137.44 cr.
Closing cash is 289.43 in the year ended 2013.

CASH FLOW STATEMENT as an year ended 31st March, 2011 and

2012.
India Bulls
Cash Flow

In Cr.
Mar
'12
12
mths
52

Mar
'11
12
mths

Net Profit Before Tax

Net Cash From Operating Activities
Net Cash (used in)/from Investing Activities
Net Cash (used in)/from Financing Activities
Net (decrease)/increase In Cash and Cash Equivalents
Opening Cash & Cash Equivalents
Closing Cash & Cash Equivalents

394.2
5

246.9

-2914

830.2
7

509.4
1 -360.4
0

1334.
7

-4449

-1070

-3980

1359.
7

6940.
1

INTERPRETATION
Observed the above table that the net profit before tax is 246.9 cr in the year
2011.
53

It is increased to 790.87 cr in the year 2012.

Net cash from investing Activities is -360.44 cr in the year 2011 it increased to
509.41 cr in 2012.
Net decrease/increase in cash and cash Equivalents is -4449.30 cr in the year
2011. It increases to 1334.73 cr in 2012.
Opening cash is increases compares to 2012. Is -1070.20 cr.
Closing cash is 1359.67 in the year ended 2012.

CASH FLOW STATEMENT as an year ended 31 st March, 2010 and

2011.

India Bulls
Cash Flow

In Cr.

54

Mar
'11

Mar
'10

12
mths

12
mths

Net Profit Before Tax

Net Cash From Operating Activities
Net Cash (used in)/from Investing Activities
Net Cash (used in)/from Financing Activities
Net (decrease)/increase In Cash and Cash Equivalents
Opening Cash & Cash Equivalents
Closing Cash & Cash Equivalents

246.9

566.8
6

830.2
7

-4471

-360.4 -14.95
0

-4449

10797

-3980

6310.
8

6940.
1

629.2
8

INTERPRETATION
Observed the above table that the net profit before tax is 566.86 cr in the year
2010.
It is increased to 246.90 cr in the year 2011.
Net cash from Investing Activities is (14.95) cr in the year 2010 it increased to
360.44 cr in 2011.

55

 Net decrease/increase in cash and cash Equivalents is 10797.10 cr in the

year 2010. It increases to -4449.30 cr in 2011.
Opening cash is decreases compares to 2011. Is -3979.50 cr.
Closing cash is 6940.09 in the year ended 2011.

56

CHAPTER-5
CONCLUSIONS & SUGGESTIONS

FINDINGS
Observed the above table that the net profit before tax is 790.87 cr in the year

2013.
It is increased to 932.37 cr in the year 2014.
Net cash from investing Activities is 797.92 cr in the year 2013 it decreased to

(863.21) cr in 2014.
Observed the above table that the net profit before tax is 394.25 cr in the year
2012.
It is increased to 790.87 cr in the year 2013.

57

Net decrease/increase in cash and cash Equivalents is 1334.73 cr in the year

2012. It increases to 9227.52 cr in 2013.

Observed the above table that the net profit before tax is 246.9 cr in the year

2011.
It is increased to 790.87 cr in the year 2012.
Net decrease/increase in cash and cash Equivalents is 10797.10 cr in the

year 2010. It increases to -4449.30 cr in 2011.

Observed the above table that the net profit before tax is 566.86 cr in the year
2010.
It is increased to 246.90 cr in the year 2011.

CONCLUSIONS
Every organization has pre-determined set of objectives and goals, but reaching
these objectives and goals only planning and executing of the plans economically.
The India Bulls Limited is objectives of planning promoting and organizing
an integrated development of central company.
The organization needs the capable personalities as management to lead
the organization successfully, the management makes the plans and implement of
these plan are expressed in terms of budget and budgetary control.
The India Bulls Limited has budget process in two stages. One is capital
expenditure budget and another is operating maintains budget, the capital
expenditure budget shows the list of capital projects selected for investment along
with their estimated cost, operating

and maintains budgets refers used in the

organization like long term budgets, research and development budget and budget
for consultancy.
The India Bulls Limited ltd is to make available quality service efficient resources and
implementation of sophisticated technology and also creating ambience of collective
working of its employees.

58

SUGGESTIONS
Planning has become the primary function of management
most of the planning relates to individuals and individuals proposals.
Budgets are nothing but his express, largely in financial terms.
Budgetary controls have, therefore become and essential tool of
management for controlling and maximizing profits.
The company objectives of the organization and how they
can be achieved through budgetary control.
Time tables for all stages of budgeting follow.
Reports, statements, forms and others record to be
maintained.
Continuous

comparison

of

actual

performance.

59

performance

with

budgeted

BIBILIOGRAPHY
FINANCIAL MANAGEMENT

IM PANDEY

FINANCIAL MANAGEMENT

Dr.S.K.R.PAUL

FINANCIAL MANAGEMENT

MY KHAN, PK

JAIN

MANAGEMENT ACCOUNTING

Dr.S.P.GUPTA

ADVANCED ACCOUNTANCY

S.P. JAIN,

NARANG

ADVANCED FINANCIAL ACCOUNTING

WEB SITES

www.google.com

www.moneycontrol.com
60

S.N. MAHESWARI

www.business-standard.com

61