A Study on financial performance analysis

INTRODUCTION.

1.1 Introduction of study:

The Bangalore milk union Ltd.,(BAMUL) was established during 1975under operation Flood II
by keeping “AMUL” as its Role model . At present Bamul has Bangalore urban, Bangalore rural
& Ramanagara districts of Karnataka as its area of operation for milk Procurement and selling
milk in part of Bangalore Mahanagara palika (BBMP) area. Since its inception the union is
constantly striving further for dairy development and marketing activities in its milk shed area.

A Internship of a excellent way of the and all important connection that is the valuable
developing. And maintaining to strong, and good professional network and future. Earning good
knowledge gain and good communication skills gain.

The study conduct at ‘BAMUL’ in CO-OPERATIVE MILK PRODUCER’S SOCIETIES

UNION LTD., know the study position of internship is the integral part of the academic syllabus
of MBA and internship gap between knowledge in study.

The internship has been in position duration of the 4th semester 6 weeks, in MBA the study
involving a topic is consumer perception. And it explain the various department in purchase
department, finance department, and production marketing, Human resource and so on. And It
gives a Corporate world. Study in BAMUL.

I’m doing with in a study of the BAMUL milk product CO-OPERATIVE MILK
PRODUCER’S SOCIETIES UNION LTD.,

INDUSTRY PROFILE:

The governments of India constitute the “National Dairy development Bord” in the year 1965
shri-Lalbahudhur Shastri initiated up of NDDB. The board is registered under the society’s
registration act and public trust at the head office.

Karnataka milk federation (KMF) sells product the such has paneer, and curds, and milk in
the name of nandini. It is milk company federation and associated worked co-operative
principals. It is a almost of the district in state of Karnataka has milk producing Karnataka. The
first of the dairy co-operative in India on 1955 in kodagu district. The KMF was founded by the
1974 of Karnataka dairy development corporation (KDDC) to the implement a dairy
development project running in the world Bank. In a 1984 the organization was renamed KMF .

The KMF has 14 milk union in Karnataka state of the which procure milk from primacy of the
cooperative (DCS) and distribute milk consumer in various urban and so rural market of the
Karnataka state with 1500 members.

BGS INSTITUTE OF TECHNOLOGY Page 1

A Study on financial performance analysis

The dairy industry is the important place in the animal husbandry. And embraces the production
of the milk, and it is a preparation for sale as well as manufacturing of dairy products. The
government of the india has a annual survey of industry. And the dairy is a depend opn a milk
and milk is the one of the row material for the dairy product. And all so a dairy is a milk is the
perfect food for the ages. It has a almost of the vital nutrints needed for the increase welling of
the human body.

The dairy industry have a grown from an almost of the completing un organization and so vastly
complexity industrial large of a magnitude to the organization industry in duration of the last in
55 years with the an annual milk product as a of about 29 million metric ton years . In India has a
1970-80 India’s milk production is a in 2016 is a forecasting at a 90 million tones.

The dairy enterprise is an important of the farmer of occupation. And in India has a nearly at
75% of the depend of the agricultural. It is the backbone of the India. The Agricultural dairy to
the large of the industry extend. Animal husbandry in India is an essential part of the agricultural.
The dairy sector has a remarkable shown and developing in the past decades and now become
one of the largest high product. On 1997 and 1998 is the state has had 17574 million tones
production capacity. And India has a socio-economic development and important constitute
segment of the rural economic.

NDDB National Dairy Development Board:

 Empowerment with exploitation

 Modernity with the Tradition
 Growth with the stagnation.

“Growth and development of the dairy industry in India”.

During the last pre-Independence year three was no serious is stress in the dairy industry.

On 1886 the department of define of the British government in the establish the dairy supply of
milk in to the Allahabad. An next the 1920 serious steps of the were taken by the and William
smith, and dairy is a improving. And co-operative union Ltd. In the 1946 AMUL, and

 Co-operative in the activities between in the union.

 Developing in a markets of the ricing in the milk production.
 Make the brand as a house hold of the production
 To the market increase share of the product

BGS INSTITUTE OF TECHNOLOGY Page 2

A Study on financial performance analysis

Milk:

The milk is a defined as a whole of the fresh, clear, lacteal, suretion obtained by the complete
milking of the animals, It represent the perfect food for a man nearly than the other natural of the
food. An a adequate consumption of the milk can a correct for a most of the people strong, and
healthy bodies. And its appetizing food as well as being healthful.

Asian dairy scene:

The Asian dairy is a has been in a practical as a rural cottage industry in a scene, and with 60%
of the world population, Asia accounts for only 20% of the milk of global production.the total of
the world production is a more than a 600 million tones for a population of the 5 billion amount
to and average of the annual capacity storage. And availability of the 100kgs. And the
corresponding in the figure of the only 27kgs and the consumption. Is about a 30kg’s some of
the 10% of the milk and Asian countries import of the dairy product in india.

Dairy in India:

As a the urbane population increase, fewer household could keep a cow for the private use. The
high cost of the milk production, problem of sanitation etc. dairy is a has been cottage as a since
the remote part of the semi-commercial dairying started with the establish of the military of the
dairy farms and cooperative milk union country.

1.1 COMPANY PROFILE:

The banglore milk union Ltd., (Bamul) was established during 1975 under operation flood 2 by
keeping “ at present Bamul has Banglore Urban, Banglore Rural and Ramanagara District of
Karnataka state as its areas of operation for the milk procurement and selling milk in part of
Bruhath Banglore Mahanagara Palika (BBMP) areas. Since its inception the union is constancy
striving futher for dairy development and marketing activities in its milk shed areas.

The Banglore milk union Ltd., (BAMUL) is of the unit of Karnataka cooperative milk producer
Fedaration of the limited (KMF) which is the Apex Body in Karnataka represented the dairy
farmer co-operatives. It is the one of the second largest dairy cooperative in the country. In south
india it stand first in rems of procurement as well as sales. The brand of the “Nandini” is the
household name for pure and fresh milk and milk product.

BGS INSTITUTE OF TECHNOLOGY Page 3

A Study on financial performance analysis

COMPANY PROFILE:

ACTIVITIES: Our Main aim is “A customer is the most important visitors of the we are not
doing him a favour by serving him he is the us a favour by giving us an opportunity to do so ”

 Mahathama Gandhi.

Facilities: Hostel facilities Bamul is the trust is running boys hostel for the degree and
Postgraduation students for a milk procurement cooperative societies members and employee at
as the vidhyaranyapura, banglore -560097

BGS INSTITUTE OF TECHNOLOGY Page 4

A Study on financial performance analysis

AWARDS AND ACHIVEMENT:

Bureau of Dynamism competence, Goyt of India discussed BAMUL has been awarded
2nd place for the success in Energy conservation for the year 2005 in Dairy sector.

Karnataka safety Council Karnataka Govt conferred BAMUL has been awarded 1st
place in best Safety Industrial Boiler award for Boiler Maintenance in the year 2007.

Karnataka Renewable Energy Development ltd (KREDL) Govt of Karnataka conferred

BAMUL has been awarded 2nd place for the achievement in Energy conservation for the
year 2008-09 in Dairy sector.

The Union is skilled for Food Safety Management System, ISO 22000:2005 by M/s
Standards Australia International Global, Mumbai

Bamul has been certified for ISO 22000:2005 & ISO 9001-2000 for quality management
and Food Safety Structures. The National Output Council (NPC) of Government of India
has conferred Best Production Award for FIVE TIMES

KARNATAKA MILK FEDARATION

Name of the company: Bangalore urban, and rural, and Ramanagara District co-operative milk

producers societies union ltd.,

Industry : Dairy fast moving consumer good

Founded : 1974

Headquarters : Bengaluru

BACKGROUND OF DAIRY:

 On January 1st 1958 a pilot scheme to cater the banglore milk market, department of the
Animal Husbandry, Government, of Karnataka, NRDI. Later on the in 1962, the
banglore milk supply scheme came into the existence of the as independent body.

 The more effort of the in dairy hobble minister for the revenue and the dairying,
Government of the India and Government of the Mysore sri MV krishnappa, state on
23rd January 1965 by the then honble prime minister late sri lal Bahudhur shastriji.

BGS INSTITUTE OF TECHNOLOGY Page 5

A Study on financial performance analysis

 The banglore situated in the over of 52 Acres of land, and the dairy had an initial
capacity to the 50,000 liters of milk per day.

 Banglore dairy underwent a structural change in December 1975 and handed over to the
Karnataka dairy development corporation (KDDC).

 The rural milk scheme of mysore, hasan and kuduge district was the started under
(KMF) in may 1984 as a successor of KDDC.

 To create to the growing demand for milk by the consumer of banglore city, the capacity
was the increase the to 1.6 laks to the liters per day under the operation flood during the
1981 and later increase to the 3.5 lakh liters per day under opration.

 The milk of the banglore KMF BAMUL comprise of the 2611 revenue villagers. As now
the union has to be milk union over the in banglore dairy functioning 2084 milk products
co operative society (MPCS) in 4,320 villagers in these three district. And 3,50,070
registered milk producer member belong to scheduld caste and tribes.

VISION, MISSION, AND QUALITY POLICY OF THE BAMUL:

 VISION:-
 TO march forward with a missionary zeal which will make KMF a trailblazer of
exemplary performance and achievement beckoning other milk federation in the country
in pursuit of emulation of its good deeds.
 To ensure prosperity of the rural milk producer who are unlimited owners of the
federation.
 To promote producer oriented viable cooperative society to import to the rural income,
dairy productivity and rural employment.
 To develop business acumen in marketing and trading disciplines so as serve consumers
with quality, milk, give a fillip to the income of milk producer.

 MISSION:-
 Ushering rural property in the lives of member of milk producer.

 QUALITY POLICY:-
 Bamul is the committed to ensure the supply to the milk product to meet the satisfaction
of customer.

BGS INSTITUTE OF TECHNOLOGY Page 6

A Study on financial performance analysis

 By constant communication with all parties involved in food chain to bring about
continual important.
 By adopting the most modern and the appropriate methods to the ensure best standards in
the procuring, processing, and marketing high quality milk and milk product.
 By complying with statutory and the regulatory requirement.

1.1 PRODUCT ARE SERVICES PROFILE AREAS OF OPERATION OF THE BAMUL:

 Bangalore Urban and Rural Dist. Co-operative Milk producer societies Union Ltd.
Dr.Marigowda road, Bangalore

 Kolara Chikkaballapura District. co-operative milk producer societies Union Ltd.

Kolar dairy, N.H-4, Huttur (post)

 Mysore District. Co-operative Milk producer societies Union Ltd.

Siddarthanagara, T. Narasipura Road,

 Mandya District. co-operative milk producer societies Union Ltd.

Product Dairy gejjalagere-571428 maddur thaluk, mandya

 Tumakur District. co-operative Milk producer societies union Ltd.

B.H. Road, Mallasandra

 Hasan District. co-operative milk producer societies Union Ltd.

Industrial Estate, B.M. Road, Hasan

 Dharawada District. Co-operative Milk producer societies Union Ltd.

Product Dairy, Vidyagiri post, Lakkammanahalli Industrial Area Dharwad.

 Belagavi District. Co-operative milk producer societies Union Ltd.

Belagavi dairy Premises kanbargi Road Belagavi

 Vijayapura and Bagalkot District. CMPSUL

 Kalaburagi-Bidar CMPSUL

 Dakshina kannada CMPSUL

Kulashekara Manggalur.

BGS INSTITUTE OF TECHNOLOGY Page 7

A Study on financial performance analysis

 Shivamogga CMPSUL
Manchenalli, Nidige post Shivamogga

 Raichur-ballari and Koppal District CMPSUL

Near Fire station, infantry Road, Ballari

 Chamarajanagara District. CMPUS

Santemarhalli Village Hobli, Chamarajanagara

 Mother Dairy in Yelahanka

 Nandini Hi Tech product plant

Shettyhalli, janivara post channarayapattana

 Nandhini Milk product

KMF Unit, KMF complex, P.B. NO.2915

Dr. M.H. Marigowda Road, Bengalore

 Cattle Feed plant Rajanukunte

 Cattle Feed plant Tumakuru

Railway station Road Gubbi

PRODUCTS:

BGS INSTITUTE OF TECHNOLOGY Page 8

A Study on financial performance analysis

1.6 INFRASTRUCTURE FACILITIES OF THE BAMUL (KMF)

 Activity:- the Bengalore Rural and Ramanagara District Co-operative Milk producer
Societies Member and Employee welfare trust and formed on 25th –jan-2007. It functions
for the milk products co-operative Socielimits the of Bengaluru Urban, Bengaluru Rural
and Ramanagara District only.

 Education facilities:- Prathiba Purshkara for Merit student as Mentioned the good
percentage pass out and admission students.

 Compensation facilities:-

Compensation for the member of death : 60 year and above aged societies members and
Employee when died will be given Rs 10000/- to concemed nominee from Bamul Trust.

 Compensation for the persons with physically Handicap/paralysis

 Janashree Bima Yojana (JBY) Scheme
 Benefits of the JBY Scheme

 Health facilities:-
 Free health camp

1.7 COMPETITORS OF THE BAMUL (KMF):

The Major competitors of the BAMUL dairy are the loose milk vendor, but the other brands are

 Heritage.
 Arogya.
 Dodla.
 Tirumula.
 Niligiris.
 Shurthi milk.

The private brands are promoting these products through major showing, large retail
margins, false information.

BGS INSTITUTE OF TECHNOLOGY Page 9

A Study on financial performance analysis

SWOT Analysis

SWOT analysis is an auditing of an organization and its environment. It is the analysis of

strength, weakness, opportunities and threats of the organization. Strength and weakness are
internal while opportunities and threats are external to the company.

BGS INSTITUTE OF TECHNOLOGY Page 10

A Study on financial performance analysis

STRENGTH:-

 Biggest milk co-operative union in southern India.

 Automated computerized plant
 Market leader with brand identity.
 Wide product range.
 Prompt consumer’s complaint redressed.
 Maintain uniform quality.
 Well organized distribution channel.
 Motivated and committed employees.
 Reasonable price.

WEAKNESS:

 Inflexible traditional government structure

 Slow decision making process
 External interference from state federation
 Less advertisement
 Promotion is based on seniority
 Decision- making and control rules by KMF and Karnataka government

OPPORTUNITIES:

 Ever expanding market for milk and milk products

 Favorable export environment of milk products to foreign countries at higher profit
margin, with the liberalization of global economy.
 New markets can be created and captured through innovative products
 Existing brand “NANDINI” can be used to expand its product line. Need not to invest on
brand awareness.
 The existing infrastructure can be used to meet the considerable rice in demand in the
future, with little or no change

THREATS:

 Entering of MNC’s into dairy industry with cheap milk and milk products, many create
stiff competition
 Very attractive commission for agents from rivals
 External political interference may create unfavorable circumstances
 Changes in labor laws

1.9 FEATURE GROWTH AND PROSPECS:-

BGS INSTITUTE OF TECHNOLOGY Page 11

A Study on financial performance analysis

BENGALURU:

 Increasing the demand for milk prompts federation to a facility in Kanakapura nearest
the city. With demand for milk increasing at a rate of 6-8 per cent annually in Bengaluru,
the Bangalore Cooperative Milk Union (Bamul) is investing Rs 430 crore to set up a
Current facility to procedure milk and to make other dairy products. The new facility will
come up at Kanakapura which is about 62 km from the city, in about 18 months.

 Brand Nandini sells 2.3 million liters in the town which is four-fifths of its market. “We
have to create the infrastructure Immediately as the existing facility is not enough to
handle the influx of milk to the city from other areas" Animal Husbandry Minister A
Manju told on it.

 We will have one fully automatic mega dairy where also processing milk, we will also
make products such as cheese, and other products" the minister said. As many as 64
products are traded under the Nandini brand and Karnataka Cooperative Milk Producers'
Federation (KMF) officers believe they can further expand their market share by5percent.

 The KMF's goal is to keep both dairy farmers and customers happy, said Manju. "We
want to make more consequences as they give us vigorous.

 Margins with which we can better attend the benefits of the dairy sector The Bamul, he
said, will soonopen1,000 Nandini outlet sin Bengaluru.

 Milk procurement in Karnataka has been growing at about 12.1 per cent annually since
Chief Minister Siddaramaiah doubled the incentive payable to dairy farmers to Rs 4 per
litre from May 2013. The daily procurement touched a crowning of 7.3 million litters in
July last year and the CM means to provide milk to school and Anganwadi children six
days in a week.

1.10 FINANCIAL STATEMENT OF THE BAMUL (KMF) Bengaluru:

Analysis of Financial statement:

It is a means of converting the mass of data into useful evidence. Analysis is mainly a
study of the relations between the various financial factors in a business as related by the
financial statement.

“PARTICULARS” SCH 2016-17 2015-16

‘SOURCES OF FUNDS’

BGS INSTITUTE OF TECHNOLOGY Page 12

A Study on financial performance analysis

PAID UP SHARE CAPITAL 64 453782000 406710000

NOMINAL MEMBERSHIP 157600 127710

SHARE SUSPENSE 2558792.95 2740614

GOVT. CAPITAL GRANTS 17806005.16

RESERVES AND SURPLUS 65 2947029659 1630497086

LOAN LIABILITY 66 688467717 691725756

CURRENT LIABILITIES PROVISIONS 71 2323406088 1022976824

PROFIT AND LOSS A/C 303148980.2 119528520

GRAND TOTAL 6736356842 3874306510

‘APPLICATION OF FUNDS’ 6736356842

FIXED ASSETS 68 1893043790 1615219674

WORK IN PROGRESS 405868924.9 130173921

DEFERRED REVENUE EXPENDITURE 0 0

INVESTMENTS 69 1970074461 195622554

SUB TOTAL (2) 4268987176 1941016150

‘CURRENTASSETS-LOANS-
ADVANCES’

INVENTORY 70-A 874807257.5 1315879400

SUNDRY DEBTORS 70-B 300985490.4 318370011

CASH & BANK BALANCES 70-C 747218980.8 54380077

LOANS & ADVANCES 70-D 350472602.3 189516287

SERVICE DEPOSITS 70-E 24253405 23430668

OTHERS - 169631930.4 31713917

BGS INSTITUTE OF TECHNOLOGY Page 13

A Study on financial performance analysis

A+B+C+D+E+F: SUB TOTAL(70) 2467369666 1933290360

GRAND TOTAL(2+4) 6736356842 3874306510

RATIO ANALYSIS:

Ratio analysis is a powerful & most commonly used tool of analysis and interpretation of financial
statements. It extracts on the inter-relationship between the figures appearing in the financial
statements. Ratio analysis helps to analyze the past performance of the company & to make future
projections. It allows various interested parties like management, shareholders, potential investors,
creditors, government & other analysts to make an evaluation of the various aspects of company’s
performance from their own point of view and interest.

Ratio Analysis as a tool retains several important structures. The information which remain
provided by financial statements, are readily available. The calculation of ratios helps the
comparison of firms which change in size. Ratios canister be used to link a firm's financial
presentation with industry norms. In adding ratios can be used now a form of movement analysis to
isolate areas where presentation has improved or depreciated over time.

I. CURENT RATIO:

The Current Ratio is an catalog of the worry’s financial constancy, since, it shows the extent to
which the current assets surpass its current liabilities. A complex current ratio would specify
insufficient employment of moneys, while a poor current ratio is a menace signal to the
management. The ratio is an indicator of the firm’s promise to meet its short-term liabilities.

CURENT ASSETS
CURENT RATIO = -------------------------------------

CURENT LIABILITIES

BGS INSTITUTE OF TECHNOLOGY Page 14

A Study on financial performance analysis

YEARS Current Assets Current Liabilities Ratios

II. LIQUID RATIOS:

Liquidity Ratio Definite. In accounting, the term liquidity is defined as the ability of a
company to meet its financial responsibilities as they come unpaid. The liquidity ratio, then, is a
computation that is cast-off to portion a company's capacity to pay its short-term debts.

YEARS Ratios

BGS INSTITUTE OF TECHNOLOGY Page 15

A Study on financial performance analysis

BGS INSTITUTE OF TECHNOLOGY Page 16

A Study on financial performance analysis

BGS INSTITUTE OF TECHNOLOGY Page 17

A Study on financial performance analysis

BGS INSTITUTE OF TECHNOLOGY Page 18

A Study on financial performance analysis

BGS INSTITUTE OF TECHNOLOGY Page 19

A Study on financial performance analysis

Chapter 2

Conceptual background and

literature review

BGS INSTITUTE OF TECHNOLOGY Page 20

A Study on financial performance analysis

Theoretical background of the study

BGS INSTITUTE OF TECHNOLOGY Page 21

A Study on financial performance analysis

BGS INSTITUTE OF TECHNOLOGY Page 22