A

SYNOPSIS
ON
“A STUDY OF FINANCIAL MANAGEMENT SYSTEM M/S WESTERN
COALFIELD.LTD (WCL)”
Submitted To
Rashtrasant Tukadoji Maharaj Nagpur University, Nagpur
In the Partial Fulfillment for the award of degree in
BACHELOR OF BUSINESS ADMINISTRATION – III(SEMESTER VI)
(Elective Subject- Financial Management)

Submitted by
Sneha S. Bhondle
Under the Guidanceof
Dr. G.B. BAGDE

Village Uplift Society’s

Annasaheb Gundewar College,
Department of Management,
Gundewar Marg, Katol Road, Nagpur.
Session (2019-2020)
 INDEX

CHAPTE PAGE
CHAPTER NAME
R NO. NO.

1 Executive summary 01

Introduction
2  Introduction to Topic 02-03
 Company Profile

3 Objective of the study 04

Research methodology
 Research Design
 Research Technique
 Research Method
 Sample Design

 Sample Technique
4  Sample Method 05-08
 Sample Area
 Sample unit
 Scope
 Limitations
 Method of Data Collection
 Primary Data
 Secondary Data

5 Data analysis & Interpretation 09-10

6 Conclusion, Suggestion & Recommendation 11-13

Appendix
7  Bibliography
EXCUTIVE SUMMARY

Ratio analysis is a technique of analyzing the financial statement of industrial

concerns. Ratio analysis is one of the most powerful tools of financial analysis
which helps in analyzing and interpreting the health of the firm. Ratios are proved
as the basic instrument in the control process and act as back bone in schemes of
the business forecast. The ability of the firm to meet its current obligation. The
limit or extent to which the firm has used its borrowed funds, through ratio analysis
the firm is utilizing in generating sales revenue and operating efficiency and
performance of the company.

In the first segment of the project I have told you about ratio analysis which plays an
important role in telling the financial position of the company. It can also be used to
evaluate the various benefits provided by specific assets.
 Meaning and Definition of Ratio Analysis:-

One of the most important financial tools which have come to be used very
frequently for analyzing the financial strengths and weaknesses of enterprise is ratio
analysis. Ratio Analysis is technique of analysis and interpretation of financial
statement. It is process of establishing and interpreting various ratios for helping in
making certain decision.

According to Myer, “Ratio analysis is a study of relationship among the various

financial factors in businesses”.

Ratio analysis represents the figure of financial statement in simple and intangible
form. Ratio analysis, in this way, is the process of establishing meaningful
relationship between two figure and financial statement.

Nature of Ratio Analysis:-

Though ratio analysis is ‘all the rage’ among the user of accounting information, it is
better to understand the ratio so that they can be employed judiciously under
appropriate condition. They are:

1. The relation between two or more financial data brought out by an

accounting ratio is not an end in itself. They are means to get to know the
financial position of an organization.
2. An individual ratio may not be capable of providing the answer required
for the various problem facing an executive
3. Ration analysis will tend to be more meaningful when certain standard
and norms are laid down so that what the ratio indicate can be compared
with the said standards. This provides a base for decision-making and
assist in taking measures to rectify any drawback or deficiency.
COMPANYPROFILE

L & t limited Company was originally incorporated as L&T Capital Holdings

Limited on May 1, 2008 under the Companies Act, as a public limited company, to
carry on the business of investment/finance. Our Company received the certificate
of commencement of business on May 15, 2008. Our Company subsequently
changed the name of our Company to L&T Finance Holdings Limited pursuant to a
special resolution passed by the shareholders at a general meeting dated September
1, 2010. Pursuant to the change of name, a fresh certificate of incorporation was
granted to our Company by the RoC on September 6, 2010.

Our Company was registered with the RBI under Section 45-IA of the Reserve Bank
of India Act, 1934, as a non-banking financial institution without accepting public
deposits by a certificate of registration no. N-13.01925 dated March 31, 2009. The
Company is promoted by Larsen & Toubro Limited as a holding company for its
financial services business.

Main objects of our Company "To carry on the business of Investment/finance

Company in all its branches and to invest, sell, purchase exchange, surrender,
extinguish, relinquish, subscribe, acquire, undertake, underwrite, hold, auction,
convert or otherwise deal in any shares, stocks, debentures, debenture stock, bonds,
negotiable instruments, hedge instruments, warrants, certificates, premium notes,
treasury Bills, obligations, inter corporate deposits, call money deposits, public
deposits, commercial papers, options futures, money market securities, marketable
or non marketable securities, derivatives and other instruments and securities issued,
guaranteed or given by any government, semi-government, local authorities, public
sector undertakings, companies, corporations, co-operative societies, trusts, funds,
State, Dominion sovereign, Ruler, Commissioner, Public body or authority,
Supreme, Municipal, Local or otherwise and other organizations /entities persons
and to acquire and hold controlling and other interests in the securities or loan
capital of any issuer, company or companies." Key events and milestones of our
Company.
 OBJECTIVES OF THE STUDY

 To evaluate the performance of the company by using ratios as yardstick to

measure the efficiency of the company.

 To understand the Liquidity, profitability and efficiency positions of the

company during the Study period.

 To make comparisons between the ratios during different periods.

 To understand the future prospectus of company.

 To understand financial position and goodwill.

1} RESEARCH METHODOLOGY

Research methodology is an important tool in any research work. It

acts as guideline and road in completion of research. It is scientific search for data
and information on as particular topic research is search for knowledge.

DEFINITION:-

“The procedures by which researcher goes about their work of describing,

explaining and predicting phenomenon are called methodology. Methods comprise
the procedures used for generating, collecting and evaluating data. All this means
that it is necessary for the researcher to design his methodology for his problem as
the same may differ from problem to problem”

TYPES OF RESEARCH

Primary Research Vs Secondary Research

Conducting primary research occurs when a company is gathering

information directly for themselves. This type of research is often conducted
through the medium of questionnaires, observations and interviews. This method
can often be very useful to companies because the results are specific to
thatparticular business.

Research design

Research design is a pre-planned sketch for the explanation of a problem. It

is the first step to take and the whole research. Study will conduct on the basis of
this research design. It gives us a due that how the further process would be taking
place and how would be the research study carry into classification, interpretation
and suggestions. This is a guideline for the whole work.

Research Technique

A research technique is a systematic plan for conducting research.

 Here, research techniques are base for secondary data and is exploratory in

nature.

RESEARCH METHOD:-

 Analytical Research Method

Sample Design: A sample design is made up of two

elements. Sampling method. Samplingmethod refers to the rules and
procedures by which some elements of the population are included in
the sample. Some common sampling methods are simple random sampling,
stratified sampling, and cluster sampling.

SAMPLING TECHNIQUE:-

 Sampling technique refers to the rules and procedures by which some elements
of the population are included in the sample. Some common  andnon-
probability sampling .But the researcher is using Non Probability technique in
this research.
SAMPLING METHOD
NON Probability Sampling:-Convenience sampling is used in exploratory
research where the researcher is interested in getting an inexpensive approximation
of the truth. As the name implies, the sample is selected because they are
convenient. This no probability method is often used during preliminary research
efforts to get a gross estimate of the results, without incurring the cost or time
required to select a random sample.

 SAMPLE AREA :-

The sampling area was Nagpur city.

 SAMPLING UNIT:-

L&T Finance Medical Square Nagpur.

SCOPE

 It helps the management in effectively discharging its functions/operations

such as planning, organizing, controlling, directing and forecasting.
 Ratio analysis is used as a benchmark for effective control of performance
ofbusiness activities.

LIMITATION

 The Study is Limited for the period of 2014-2018, so that whatever data
collected for that period the project on that period only.
 Ratio analysis is the process to carry out the financial position of the
company but only use of this limited as there are few other factors which
can present the financial position of the company.
 As the ratios are computed on the basis of financial statements, the basis
limitation which is application to the financial statement, is equally
applicable in case of the technique of ratio also.
 CONCLUSION

 After analysis I found that the company has earned profit but its fluctuating.
 Current ratio has shown a decreasing trend for couple of years, debt equity
ratio has increased as compared to last year.
 The company is doing good and growing every year in the terms of net
profit ratio. It showed rapid growth from 2017 to 2018 and maintains it till
2019.
 The earning per share of the company is increasing which means company is
doing well and need to maintain it.
 The gross profit ratio of the company is static in first three years but now it
has started to increase.
 The total asset turnover ratio is static in each year of the company.
 RECOMMENDATIONS AND SUGGESTIONS

 The proprietary ratio of the company was continuously decreasing it means

that the company is highly depends on creditors.So the company needs to

increase this ratio.

 After analysis and interpretation of the financial statements, it is suggested

that the company should focus on its future development and should keep in

mind that there is scope of development.

 The debt equity ratio is rising every year this means that the creditors are less

secured and company needs to decrease its ratio.

 The return on asset ratio is good as compared to previous two year which

means Company is efficiently using its assets

 BIBLIOGRAPHY

 Books:

 Ravi M. Kishore, Cost and Management Accounting, Taxman’s.

 Khan M. Y. and Jam P. K., Financial Management
 Kulkarni P. V., Financial Management
 Pandey I. M., Financial Management
 T S Grewal, Financial Management
 Dr. S.C. Gulhane, Fundamental of business finance.
 Dr. P. S. Ravindra, Financial management.
 Priyanka singh, Fundamental of business finance.
 Dr. R. P. Rustagi, Fundamental of financial management.

 Internet Sources:

 www.investopedia.com
 www.wikipedia.org
 www.ndtv.com
 www.indiafoline.com
 www.equitymaster.com
 www.larsentoubro.com
 www.goodsreturn.in
 www.moneycontrol.com
 www.financebazar.com