Introduction to Finance

The term ‘nature’ as applied to financial management refers to its function, scope & objectives. Financial management, as an academic discipline, has undergone fundamental changes in its evolution it was treated synonymously with the raising of funds. In the current literature pertaining to financial management. A broader scope so as to include, in addition to procurement of funds efficient use of resources is universally recognize.

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Importance Of Finance In Modern World
Finance helps business enterprisers & management in getting over their business problems & accomplishing their width maximization good, Knowledge of finance & its tools & techniques provide strong & soled bases for making decision in all business matters. One such very important matter pertains to investment. In the area of investment, an entrepreneur has to decide as to What Capital expenditures should the enterprise make, what volume of funds should be committed & how should funds be allocated as among different investment outlets. Another problem which the management has to resolve is related with designing such pattern as may be helpful in maximizing or gaining per share & so also the market value of shares. This involves examination in depth. Of some of the important issues such as from that sources are funds available? To what extent are funds available from this sources? What is the expected cost of future financing given sources of funds should be tapped and to what extent?

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Finance and related disciplines
Financial managing as an integral part of overall management , is not a totally indipendent area.it draws heavily on related disciplines and fields of study, such as economics, accounting, marketing, production etc. FINANCE & ECONOMICS: The relevance of economics to financial management can be described in the light of the two broad areas of economics :macro economics and micro economics. Macro economics is concerned with the institutional structure of the banking system, money , and capital markets, financial intermediaries, monetory, credit and fiscal policies dealing with,and controlling level of, activity within an economy. Micro economics deals with he economics decision of individuals and organizations. It concerns itself with the determination of optimal operating strategies. FINANCE & ACCOUNTING The relationship between finance and accounting, conceptually speaking, has two dimensions: 1.they are closely related to the extent that accounting is an important input in financial decision making; And 2.there are key differences in view points between them.

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DEFINATION OF FINANCIAL MANAGEMENT
1. 2. “financial management is the operation activity of a business that is responsible for obtaining and effectively utilizing the funds necessary for efficient operation.” “business finance deals primarily with raising administering and disburing funds by privately owned business units operating in non financial fields of industry .” “Finance management is an area of business management devoted to a judicious used of capital and a careful selection of sourceful of capital in order to enable a business firm to move in the direction of reaching its goods.”

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SCOPE OF FINANCE MANAGEMENT
The approach to the scope and function of financial management is divided into three broad categories. (A) Traditional approach In the traditional approach the scope of the finance function was treated in the narrow sense of procurement of funds by corporate enterprise to meet their financing needs.
1. The traditional arrangement in the financial institution of the capital market. 2. The financial instrument through which funds are raised from the capital

markets. 3. The legal and accounting relationship between a firm and its sources of funds. The traditional approach evolved during the 1920’s and 1930’s but has how been discarded as it suffers from serious limitations. The weakness of the traditional approach falls in to this category.
4. Those relating to the treatment of various to emphasis attached to them. 5. Those relating to the basic conceptual and analytical 6. Frame work of the definition and the scope of the finance function.

(B) EXTENCIVE APPROACH: At the other extreme is another approach, which conceders that finance is concerned with cash only and that since nearly very business transition involves cash directly is concerned with very thing that take place in the conduct of business. This approach is too broad too be meaning full because if we accept this approaches the financial manager required to go I to detail of every business acting be it concerned with purchasing, production, marketing, personnel research and other associated activity.

MODERN APPROACH:
In the modern approach the finance function covers both acquisition of funds well as their allocation. The investment Decision: Short term or current which in the normal course of business are convertible in value, usually within a year i.e. working capital management.
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Financial decision Financing decision is concerned with the financing mix or capital structure refers to the proportion of debt and equity capital. Working capital management It is concerned with the management of current assets. 6 . Theory of capital structure:Which shows the theoretical relationship between the employment of debt and return of shoulder? 2. They can be distributed o the share holders in the it self. The decision has to which course should be followed depends largely on a significant element in the dividend decision i. 2. It is an important and integral part of financial management as short from survival is pre-requisite for long term success. one aspect of working capital management is the trade off between profitability and risk. Two alternatives are available in dealing with the profit of a firm. we may conclude that His modern approach involves the solution of three major decisions. Thus.e. Dividend policy Decisions The third major decision of financial management id the decision relating to the dividend policy. the dividend pay net ratio. that is what proportion of net profiles should be paid out to the share holders.Capital budgeting The most crucial financial decision for a firm is relies to selection of are assets or investment proposal or course of action whose benefits are likely to be available in future over the lifetime of the project. There are two aspacts of financing decision. This decision when jointly taken makes financial decision making optimal.

medicine. merchandising. transportation. In common parlance the word `business` is used to denote merchandising. Business must be under stood to embrace every human activity usually activated by the profit motives where by mans wants are supplied. manufacturing. mining. accounting nursing and entertaining represents activities that supply distressed services. trading.it would not be in fitness of things to place to heavy reliance on the dictionary meaning because the word finance has a marvellous ability to evoke different concept in the mind of difference persons. the operation of some sort of shop store. giving too narrow a meaning to the word. building and many other activities or business that helps to supply material wants. Dictionary meaning of the term `finance` is the application of skill or cares to the manipulation the use and the control of money . in order to develop the meaning of business finance explanation of two terms business and finance are inescapable. Thus. The practice of law. It is however.however . 7 . Thus. shipping.CONCEPT OF BUSINESS FINANCE Literally speaking the term `business finance` connects finance of business activities. dentistry and teaching. lumbering. large or small.

SCOPE OF BUSINESS FINANCE In order to understand more clearly the meaning of business finance it is worth while to high light the scope of business finance .At the outset. meeting the requirements of government bodies and administration of these funds by the government country to this. comprises personal finance. Finance is such one fact of broader economic activity of mobilizing saving and directing them in investment finance includes both public and private finance. business. 8 . Public finance is the study of principle and practices pertaining to the actuation of funds. it may be pointed at that business finance is concerned with the finance of profit making organization only and is an important segment of private finance. private finance concerns with producing money for private organization and management of the money by individual voluntary associations and corporations. Private finance therefore.

M. Bagrodia Mr.C. R. Gupta Mr. B. Kumar Mangalam Birla (Chairman) Mrs.C Bhargava Mr. Rajashree Birla Mr. Mandelia 9 . Bhargava Mr. M. Apte Mr.General Information BOARD OF DIRECTORS Mr. S. Subrahmanyan Æk°p ミ P% Mr. Y.V.P. D.G. Cyril Shroff Mr.P.L.

Rathi COMPANY SECRETARY Mr.P) 10 .. D.D.P. New Delhi REGISTERED OFFICE GRASIM INDUSTRIES LIMITED Birlagram. Nagda 456 331 (M. Ashok Malu AUDITORS M/s G. Mumbai M/s Lodha & Co.CHIEF FINANCIAL OFFICER Mr. Kapadia & Co.

7 (418. The VSF business performance has been noteworthy.5 790. Realization grew by 9% at Rs 79. Sales volume raises marginally due to the increased availability of cotton during the year. in line with the 11 . 2005. Capacity utilization optimizing efficiencies and aggressive marketing of value added product have taken your company to this performance.7 20.DIRECTORS’ REPORT PARTICULAR Gross turnover Gross profit Less : depreciation Profit before exceptional item & tax expenses Exceptional items Surplus on pre payment of sales tax loan Profit before tax & diminution Provision for permanent diminution in the value of investment & loans Profit before tax Tx expenses Profit after tax Add :Debenture redemption reserve written back Investment allowance reserve written back Balance brought forward from previous year Surplus available for appropriation Appropriation General reserve Propose dividend Corporate tax on dividend Balance transfer to balance sheet 850.9 1785.0 1682.3 16.7 2003 2004 6130.0 1682.0) 885.0) 1303. Gross profit and Net profit have been.1 790.0 128.5 273.0 8.9 0.5 1361.4 1785.1 1048.3 1395.008 per ton.3 42.952 tons was a significant 12%higher over that of the previous year.2 700.4 2004 2005 7201. indeed.3 1077.0) 779. impressive.9 284.3 (298.7 (92.2 1077.3 34.1 1645.turnover.0 146.9 Your company has posted a commendable for the year ended 31st march.4 6.0 1321.9 815. Production at 247. All of your company’s business have given gratifying results.3 955.

HUMAN RESOURCES During the year . expertise and details of other directorships of these directors are attached along with the Notice of the ensuing Annual General Meeting. Mrs. which has nationwide trading reach. B.international ternd. DEBENTURE AND TERM LOAN Your company has raised log term Foreign Currency loans aggregating USD 50 million (Rs 221 crores ) and Rupee loan of Rs 30 crores.The result have been encouraging and confirm that we are by and large on right track as far as people processes and systems are concerned. the Company. was conducted . and these have been extinguished in the books. Mumbai (BSE) and the Natoinal Stock Exchange of India Ltd.the Organisational Health Survey .D.135 crores . For and on behalf of the Borad KUMAR MANGALAM BIRLA 12 . D. 2004 to 31st July 2007. Directors wish to thank Central and State Grovernment . 74 crores. a brief resume. The total outgo of the dividend to be paid to the share holder will be Rs 167. Raashree Birla .Subrahmanyan retire from office by rotation and being eligible .Bhargava and Mr. DELISTING OF EQUITY SHARES In accordance with the approval granted by the shareholders. (NSE).V. The Company ‘s Equity Shares hall contiune to be listed on the Stock Exchange . Has got its equity shares delisted from the Stock Exchange ay Indore and Kolkata . The funds were utilized to meet the requirement of capital expenditure and for general corporate purposes. Share holder and business associates for there continued co-operation and support. DIRECTORS Mr. S.G. Your company repurchased its own debenture aggregating Rs.3 crores(inclusive of Corporate Tax on Dividend @ 14. DIVIDEND Your Board has recommended a dividend of Rs 16 per share(last year Rs 14) and seeks your approval for the same. offer themselves for reappointment . Your company has repaid debenture aggregating Rs. which is the barometer of happiness at index in the Group . Mr.1 crores paid in the previous year. leading to higher operating profit.025% ) as against Rs 145. Banks. Financial institutions.Rathi was appointed as a Whole Time Director of the company for a period of 3 years from 1st August .

Our responsibility is to express an opinion on this financial statement based on our audit.Mumbai . Those standards required that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. as at 31st march.2005 chairaman AUDITOR’S REPORT TO THE MEMBERS OF GRASIM INDUSTRIES LIMITED We have audited the attached the balance sheet of Grasim Industries Limited. on a test basis. 2005 and also the profit and loss account and the cash flow account for the year ended on that date annexed thereto. This financial statements are the responsibility of the company’s management. An audit also includes assessing the accounting principles used and significant estimates made 13 . 29th April . An audit include examining . evidence supporting the amount and disclosures in the financial statement. We conducted our audit in accordance with auditing standard generally accepted in India.

of India in terms of sub. Place : Mumbai Dated : 29th April. 30547) 14 .by management. 2003(the order) issued by the central govt. the company has an internal audit system commensurate with the size of the company and nature of its business  The company has not defaulted in repayments of any dues to financial institution or banks or debenture holder  On the basis of records made available to us. We believe that our audit provides a reasonable basis for our opinion . 2005 For G. on the matters specified in the paragraphs 4 and 5 of the shade order. we further report that :  In our opinion. the company has created securities in respect of debenture issued / outstanding during year  The company has not raised any money through a public issue during a year. Chartered Accountants NIMESH BHAMANI Partner (Membership no.section 4A of section 227 of companies act. As required by companies (auditors report) order.Kapadia & co. as well as evaluating the overall financial statement presentation.P. 1956.

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RATIO ANALYSIS Financial analysis is the process of identifying the financial strengths and weakness of the firm by properly establishing relationship between the items of the Balance Sheet & Profit & Loss Account. In financial analysis a ratio is used as a benchmark for evaluating the financial positions and performance of the firm. Ratio analysis is a powerful tool of Financial Analysis. A single figure by itself has no meaning but when represented in terms of a related figure. The nature of analysis will differ depending on the purpose of the analysis. Profit is the ultimate output of a 16 . creditors. Financial analysis can be undertaken by the management of the firm. it yields significant inferences. investors & others. Management of the firm would be interested in every aspect of the financial analysis. Profit is the difference between revenue and expenses over a period of time (usually one year). A ratio is defined as “The indicated quotient of two mathematical expressions” and as “The relationship between two or more thing”. It is their overall responsibility to see that the resources of the firm are used most effectively and efficiently and that the firm’s financial condition is sound. PROFITABILITY RATIO Company should earn profit to survive and grow for a long period of time. or by the parties outside the firm owners. The rationale of ratio analysis lies in the fact that it makes relations information comparable.

also interested in the financial soundness of a firm are the owners and management of the firm is naturally eager to measure its operating efficiently. sales. Change in the gross profit can be brought about by changes in any of these factors. Profitability ratios can be determined on the basis of either sales or investments. A high gross profit ratio to sales is a sign of good management as it implies that the cost of production of the firm is relatively low. If adequate profits are not earned on sales. Apart from the creditors. PROFITABILITY RATIOS RELATED TO SALES These ratios are based on the premise that a firm should earn sufficient profit on each rupee of sales. Therefore a financial manager should continuously evaluate the efficiency of the company in terms of profits. there will be difficulty in meeting the operating expenses and no returns will be available to the owners. the owners invest their funds in the expectation of reasonable returns. FORMULA: (SALES – COST OF GOODS SOLD) * 100 / NET SALES 17 .company and it will have no future if it fails to make sufficient profits. Operating Ratio. Profitability ratios are calculated to measure the operating efficiency of the company. Similarly. GROSS PROFIT RATIO Gross profit is the result of the relationship between prices. Net Profit Ratio. Stock Turnover Ratio. both short-term and long-term. The operating efficiency of a firm and its ability to ensure adequate returns to its shareholders depends ultimately on the profits earned by it. Expense Ratio. warranting a careful and detailed analysis of the factors responsible for it. The profitability of a firm can be measured by its profitability ratios. These ratios consist of:      Gross Profit Ratio. volume and costs. A relatively low gross margin is definitely a danger signal.

The net profit margin is an indicative of management’s ability to operate the business with sufficient not only to recover from revenues of the period.36 6229. the cost or merchandise or services. Sales – COGS. This measures the relationship between net profits and sales of the firm.76%.) – Increase / Decrease in stock. (Raw material + Manufacturing exp. the ration can be computed.98% and in year 2004-05 is 34.76 % Interpretation The Gross Profit ratio of Company in the year 2002–03 is 35.83 5213. Gross Profit ratio of 2004-05 : Gross Profit ratio = 2165.20 35.54 4606. but also to leave a margin of reasonable compensation to the owners for providing their capital at risk. Which shows management efficiency of the company.26 = 34. the expenses of operating the business and the cost of borrowed funds.76 The Gross Profit ratio of Grasim industries Ltd. FORMULA: PROFIT AFTER TAX / NET SALES * 100 18 .09% and in year 2003-04 is 51. In the year 2003-04 it is increasing which is favourable for the company but in the year 2004-05 it is decreasing which is unfavourable for the company NET PROFIT RATIO Net Profit Margin is also known as net margin.36 * 100/6229. is as follows: Years Gross Profit Net Sales Percentage 2002-03 1616.98 % 2004-05 2165.Net Sales = COGS = Gross Profit = Sales – Sale of Scrap.09 % 2003-04 2709.26 34.21 51. The ratio of net profit (after interest and tax) to sales essentially expresses the cost price effectiveness of the operation. Depending on the concept of net profits employed.

) – Increase / Decrease in stock Operating Exp = Administration exp + Selling exp + Financial exp Operating Profit ratio of 2004-05 19 .71*100/6229. The higher the ratio the less will be the margin available to the owners of the company. Net Profit ratio of 2004-05: Net Profit ratio = 885.26 5213.98% 2003-04 779. is as follows: Years PAT Net Sales Percentage 2002-03 367.21%.21 14.95% and in year 2004-05 is 14.71 6229.21% Interpretation The Net Profit ratio of Company in the year 2002–03 is 7.95% 2004-05 885. Which shows management efficiency of the company.26 14.26 = 14.98% and in year 2003-04 is 14.21% The Net Profit ratio of Grasim industries Ltd. In the year 2003-04 it is increasing which is favourable for the company but in the year 2004-05 it is decreasing which is unfavourable for the company OPERATING RATIO Operating Ratio is the ratio that shows relationship between Costs of good sold plus operating expenses and Net sales. It shows the efficiency of the management.20 7. FORMULA = COGS + OPERATING EXP*100 / NET SALES Net Sales = Sales – (Income from Dividend + Income from Services + Income from Rent) COGS = (Raw material + Manufacturing exp.58 4606.Net Sales: Sales – Sale of Scrap.

76%.26 96.76% Interpretation The Operating ratio of Company in the year 2002–03 is 98.20 98.9 1963. is as follows: Years COGS OPERATING EXP NET SALE PERCENTAGE 2002-03 2989.Operating Profit ratio = 4063.67 *100/ 6229.13% 2003-04 2503. In the year 2003-04 it is high which is unfavourable for the company but in the year 2003-04 it is low which is favourable for the company but in the year 2004-05 it is high which is unfavourable for the company 20 .66 1530.26 = 96.61% 2004-05 4063.38 79.86% The Operating Profit ratio of Grasim industries Ltd.9 6229.38 1647. Which shows management efficiency of the company.41 5213.61% and in year 2004-05 is 96.13% and in year 2003-04 is 79.9 + 1530.67 4606.

is as follows: Years Total Expense Net Sales Percentage 2002-03 819.46 5213. 2.46 6229. Financial expenses but excludes taxes.26 15. Administrative expenses.83% and in year 2004-05 is 15. while a high one is unfavourable.20 17.83% 2004-05 938. FORMULA: TOTAL EXPENSES * 100 / NET SALES Total Expenses = Expenses excluding Depreciation. 4. The term ‘Expense’ Includes. 1.06%.21 15.06% Interpretation The Expenses ratio of Company in the year 2002–03 is 17. a low ratio as favourable. dividends.78% 2003-04 8825. It is decreasing every year which favourable for the company.EXPENSES RATIO Another profitability ratio related to the sales is the expenses ratio. STOCK TURNOVER RATIO 21 . Selling and distribution expenses. Which shows management efficiency of the company. It is compared by dividing expenses by sales. The expense ratio is thus important for analysing the profitability of a firm. The expense ratio is closely related to profit margin. As a working proportion.78% and in year 2003-04 is 15. 3. Cost of good sold.10 4606. The Expenses ratio of Grasim industries Ltd. and extraordinary losses due to theft of goods. gross as well as net. goods destroyed by fire and so on.

If however. If figure for cost of goods sold are not given then the ratio can be calculated on the basis of sales. FORMULA: COST OF SALES / AVG STOCK COST OF SALES = SALES AVG STOAK = OPENING STOCK + CLOSING STOCK /2 Stock Turnover ratio of 2004-05 Stock Turnover ratio = 6229.40 2004-05 6229. The company should increase sales so that stock turnover ratio also increase.4times. This ratio signifies that the average stock is turned over during the year.4 Interpretation The Stock Turnover ratio of Company in the year 2002–03 is 31. The stock turnover ratio is thus important for analysing the stock turning capacity of a firm.26 162.The number of times the average stock is turned over during the year is known as stock turnover. the monthly figure of the stock are available.09 = 38. Which shows management efficiency of the company.26 / 162. is as follows: Years SALES Avg Stock Times 2002-03 4606. Which unfavourable for the company .4times and in year 2003-04 is 45.20 146.40times and in year 2004-05 is 38.21 114.4 times The Stock Turnover ratio of Grasim industries Ltd.61 31. It is computed by dividing the cost of goods sold by the average stock in business.09 38. the average monthly stock will give this ratio will be computed ratio.4 2003-04 5213. It is decreasing from 2003-04 to 2004-05 year. Balance sheet ratio  Current ratio  Liquid ratio 22 .82 45. Average stock the average of opening and closing stock of the year.

 Quick ratio  Propriety ratio  Debt – equity ratio  Gearing ratio  Long term debts to fixed assets 23 .

CURRENT RATIO The current ratio of the firm measures its short term solvency. Calculation of current ratio of 2004-05 Current ratio :1853.672:1 which is better than 2003-04 but it is less than 2002-03 LIQUID RATIO 24 . In year 2004-05 is 1.30 1. the more is the firm’s ability to meet current obligations and the greater is the safety of funds of short term creditors. as a measure of short term / current financial liquidity.30 = 1. the larger is the amount of rupees available per rupee of current liability.01 946. The higher the ratio. is as follows: Years CA CL Times 2002-03 1495.694:1 2003-04 1496. Current liabilities: Creditors + B/P + Bank OD + Unclaimed Dividend + Provision for Taxation.672:1 The Current ratio of Grasim industries Ltd.93 1108.87 1.61 882. its ability to meet short term obligations.672:1 Interpretation The Current ratio of Company in the year 2002–03 is 1. FORMULA: CURRENT ASSETS (CA) / CURRENT LIABILITY (CL) Current assets: Cash & Bank balance + Stock + Debtors + B/R + Prepaid expenses + Loans & Advances.37 1.694:1 and in year 2003-04 is 1.580:1 2004-05 1853.93/1108.580:1 It is decreasing which is not good for the company. that is. It is expressed in times.

Liquid assets are obtained by deducting stock in trade from current assets.87 1. It is rigorous measure of a firm’s ability to service short term liabilities.37 1.30 1. It is obtained by dividing the liquid liabilities.41:1 The Liquid ratio of Grasim industries Ltd.5:1.41:1 which shows that company’s cash & bank balance is not increasing the company should make enough effort to increase their liquidity. Stock is not treated as a liquid assets because it cannot be readily converted in to cash as and when required.33 1108. FORMULA: CURRENT ASSETS / CURRENT LIABILITIES Current assets = Current Assets – Stock Current liabilities = Current Liabilities – Bank Overdraft Liquid ratio of year 2004-05: Liquid ratio= 1573.41:1 It is constant which is not good for the company but in the year 2004-05 it is also 1.27 946. 25 . QUICK RATIO The measure of absolute liquidity may be obtained by comparing only cash and bank balances as well as readily marketable securities with liquid assets. This is a very exacting standard and liquidity and it is satisfactory if the ratio is 0. is as follows: Years Current Assets Current liabilities Times 2002-03 1306. It is expressed in times.41:1 2004-05 1573.47:1 2003-04 1339. The current ratio of a business does not reflect the true liquid position’ if its current assets consist largely of stock in trade.A variant of current ratio is the liquid ratio or quick ratio which is designed to show the amount of cash available to meet immediate payments.47:1 and in year 2003-04 is 1. It is computed by dividing the value of quick assets by liquid assets.30 = 1.02 882.41:1 Interpretation The Liquid ratio of Company in the year 2002–03 is 1.33/1108.

30 = 0. FORMULA: OWNERS FUND / TOTAL ASSETS Owners fund = Share Capital + Res&Sur + M/S Exp – P&L a/c(Dr) Total assets = Fixed assets + Inv + Current assets 26 . is as follows: Years Quick Assets CL Times 2002-03 110.30 0.70 1108.11 882.07:1 which shows that company’s cash & bank balance is gradually decreasing which is not good for the company.24:1 It is increasing which is good for the company but in the year 2004-05 is 0.07:1 The Quick ratio of Grasim industries Ltd. .70/1108.87 0. PROPRIETARY RATIO The ratio shows the proportion of proprietor fund to the total assets employed in the business. Liquid liabilities = Current Liabilities Quick ratio of year 2004-05: Quick ratio= 86.48 946. The proprietor fund or shareholder equity consist of share capital and reserves &surplus.37 0.07:1 Interpretation The Quick ratio of Company in the year 2002–03 is 0.12:1 and in year 2003-04 is 0.24:1 2004-05 86.12:1 2003-04 227.FORMULA: QUICK ASSETS / LIQUID LIABILITIES Quick assets = Current Assets – Inventories.

67 8030.36 1.93 1.40:1 and in year 2003-04 is 1.26:1 2004-05 91.93 = 1.40:1 2003-04 91.69 1. as benefit of trading on equity is not availed of. A higher ratio means that outside creditors has larger claim than owner of the business. FORMULA: LONG TERM LIABILITIES / OWNERS FUND * 100 OWNERS FUND = EXCLUDING PREFERENCE SHARE CAPITAL LONG TERM LIABILITIES : SECURED LOANS + UNSECURED LOANS Debt equity ratio of 2004-05 : Debt equity ratio = 1974. DEBT EQUITY RATIO The ratio is another form of proprietary ratio establishes relationship between the outside long – term liabilities and owners fund.69 6536.62 % 27 .67/8030. it is not profitable from the viewpoint of equity shareholder’s.14:1 which shows that company’s finance position is not for the company.26:1 It is decreasing which is not good for the company and in the year 2004-05 is 1.Proprietary ratio of year 2004-05: Proprietary ratio= 91.41:1 The Quick ratio of Grasim industries Ltd. It shows the proportion of funds provided by long term creditors and that provided by long term creditors and that provided by shareholders or proprietors. If this ratio is lower. is as follows: Years Owners fund Total assets Times 2002-03 91.35*100 = 45.67 7232.81/4328.14:1 Interpretation The Proprietary ratio of Company in the year 2002–03 is 1.

it is not profitable from the viewpoint of equity shareholder’s.29 2977. CAPITAL GEARING RATIO This ratio express the proportion of preference capital and ordinary capital.The Debt Equity ratio of Grasim industries Ltd.41% and in year 2004-05 is 45. If this ratio is lower.35 45.62 % Interpretation The Debt Equity ratio of Company in the year 2002–03 is 68.83 56. In such cases the ordinary share of the company will be speculative because due to small increase in profit the ration of return on ordinary capital will increase substantially. The higher this ratio i.41 % 2004-05 1974. the capital structure of the company is said to be highly geared.62% It is good for the firms because Debt Equity is one type of debtors so It is decreasing every year which is good sign for the company. the greater the proportion of preference capital and debenture to ordinary capital. FORMULA: FIXED CHARGE BEARING CAPITAL / EQUITY SHARE CAPITAL Fixed charge bearing capital = Pref Share capital + Deb + Long term lia Equity Share Capital = Share capital Capital gearing ratio of 2004-05 : 28 . Owners fund Percentage 2002-03 2040.e.89 3610. A higher ratio means that outside creditors has larger claim than owner of the business.81 4328. It shows the proportion of funds provided by long term creditors and that provided by long term creditors and that provided by shareholders or proprietors. is as follows: Years Long term lia.29 68.52 % 2003-04 2036. In other words it is the ratio of fixed dividend bearing capital to ordinary capital. as benefit of trading on equity is not availed of. The ratio is another form of proprietary ratio establishes relationship between the outside long – term liabilities and owners fund.52% and in year 2003-04 is 56.

02 91.reserve and long term liabilities. The ratio must be 1: 1 or more i. which includes share capital .86 91. is as follows: 29 .40:1 2003-04 1422. the fixed capital must be more than fixed assets or must at least be equal to fixed assets. the business would be put to trouble and may be compelled to dispose of its fixed assets at a considerable loss to business.73:1 Interpretation The Capital gearing ratio of Company in the year 2002–03 is 17. If fixed capital is less than fixed assets .40:1 and in year 2003-04 is 15.02 / 91. This ratio there fore shows the relationship between fixed capital and fixed assets.67 15.Capital gearing ratio = 1534. is as follows: Years Fixed charge bearing capital Eq Share Capital Times 2002-03 1595.52:1 and in year 2004-05 is 16:73:1 . when these short term obligation mature.80 91. it would mean that short term fund have been used in purchasing fixed.e. LONG TERM FUND TO FIXED ASSETS RATIO Normally the fixed assets of business must be purchased out of fixed assets only. FORMULA: LONG TERM LIABILITIES / FIXED ASSETS * 100 LONG TERM LIABILITIES : SECURED LOANS + UNSECURED LOANS Long term fund to fixed assets ratio of 2004-05 : Long term fund to fixed assets ratio = 4328.67 = 16.4% The Long term fund to fixed assets ratio of Grasim industries Ltd.67 17.81*100 = 135.35/3194.73:1 The Capital greaing ratio of Grasim industries Ltd.52:1 2004-05 1534.67 16.

8%% and in year 2003-04 is 112.35 3194.8% 2003-04 3610.70 112.03 62.12 3245.4% It is good for the firms because fixed capital high more favourable it is good sign for the company.9% 2004-05 4328.Years Long term lia. Fixed assets Percentage 2002-03 2040.4% Interpretation The Long term fund to fixed assets ratio of Company in the year 2002–03 is 62.83 3195. 30 .81 135.9% and in year 2004-05 is 135.

Composite ratio  Return on investment :o Return on capital employed o Return on share holder fund o Return on equity share holder fund  Debtors turn over ( Debtors’ ratio )  Creditors’ turn over ( creditors’ ratio )  Fixed assets turn over ratio  Total assets turn over  Debt service ratio 31 .

01% It is shows the over all profitability of the business high more favourable it is good sign for the company.01% Interpretation The Return on Capital Employed ratio of Company in the year 2002–03 is 14.705% 2003-04 1248.47*100/5767. with the industry average and over time would provide sufficient insight into how efficiently the ling term funds of the owners and creditors are being used. the more efficient is the use if capital employed. The higher the ratio.70%% and in year 2003-04 is 25.35 = 25.47 5767.28% and in year 2004-05 is 25.RETURN ON CAPITAL EMPLOYED (ROCE) Here the profits are related to the total capital employed.01% The Return on Capital Employed of Grasim industries Ltd. The capital employed basis provides the test of profitability related to the source of long term funds.28% 2004-05 1442. A comparison of this ratio with similar firms. Return on Capital Employed ratio of 2004-05 Return on Capital Employed ratio = 1442. The term capital employed refers to long-term funds supplied by the creditors and owners of the firm.15 14.67 4938.35 25.61 25.46 4478. 32 . FORMULA: PBIT / TOTAL CAPITAL EMPLOYED * 100 Capital Employed = Share Capital + Borrowed Capital + Reserve & Surplus. is as follows: Years PBIT Total CE Percentage 2002-03 658.

83 21.34% and in year 2003-04 is 21.29 12.71 4328.46% The Return on Shareholders Fund of Grasim industries Ltd.RETURN ON SHAREHOLDERS FUND While there is no doubt that the preference shareholder are also owners of the firm.58% and in year 2004-05 is 20.46% Interpretation The Return on Shareholder Fund of Company in the year 2002–03 is 12. therefore.58% 2004-05 885. the real owners are the equity shareholder who bear all the risk. FORMULA: PAT / SHAREHOLDERS FUND * 100 Return on Shareholders Fund of 2004-05 Return on Shareholders Fund = 885. in the fitness of thing be assessed in terms of return to the shareholders. 33 .71*100/4328.34% 2003-04 779. participate in the management and are entitled to all the profits remaining after the outside claims including preference dividends are met in full.35 = 20. In the year 2002-03 it is low which is favourable for the company but in the year 2003-04 it is high which is unfavourable for the company but in the year 2004-05 it is lower than 2003-04 which is favourable for the company but company should try to make it lower.35 20.46%.58 2977. The profitability of a firm from the owner’s point of view should. This is the single most important ratio to judge whether the firm has earned a satisfactory return for its equity-shareholders or not.26 3610. is as follows: Years PAT Net Worth Percentage 2002-03 367.

5 2003-04 484.5 Days and in year 2003-04 is 33. FORMULA: DEBTORS + BILLS RECEIVABLES * 360 / NET SALES Debtor Turnover ratio of 2004-05 Debtor Turnover ratio = 522. the higher the value of debtor turnover the more efficient is the management. Debtor turnover ratio indicates the number of times debtors turnover each year. Thus financial analyst apply ratio to judge the quality or liquidity of debtors.26 = 30.4 2004-05 522. therefore are included in current liabilities. When a firm extends credit to the customers.1 Days. Debtors are expected to be converted into cash over a short period and. The liquidity position of the firm depends on the quality of debtors to a great extend.4 Days and in year 2004-05 is 30.DEBTOR TURNOVER RATIO A firm sells goods on cash and on credit.01 * 360 / 6229.63 5213. In the year 2002-03 it was high which is favourable for the company but in the year 2003-04 it is same which is favourable for the company but in the year 2004-05 it is lower than 2003-04 &2002-03 which is unfavourable for the company it tells us that company is recovering its money in number of days .21 33.20 33. is as follows: Years Receivables Net Sales DAYS 2002-03 429. Credit is used as a marketing tool by a number of companies.65 4606.1 Interpretation The Debtors turnover of Company in the year 2002–03 is 33.1 Days The Debtor Turnover ratio of Grasim industries Ltd. debtors are created. DEBTORS TURNOVER RATIO 34 . Generally.01 6229.26 30.

5 10. is as follows: Years Days Debtors ratio TIMES 2002-03 360 33.7 2003-04 360 33.FORMULA: 360 / DEBTOR RATIO Debtor Turnover ratio of 2004-05 Debtor Turnover ratio = 360/ 30. Similarly. the number of days with in which we make payment to our creditors for credit purchase is obtain from creditor velocity.7 2004-05 360 30.9 CREDITOR RATIO We have seen in above ratio that debtor ratio given us the number of days within which amount due for credit sale is collected.4 10. 35 .9 TIME The Debtor Turnover ratio of Grasim industries Ltd.1 = 11.1 11.

1 Interpretation The Creditor turnover of Company in the year 2002–03 is 230.49 1372.49 230.FORMULA: CREDITOR + BILLS PAYABLE * 360 / NET PURCHASE Creditor Turnover ratio of 2004-05 Creditor Turnover ratio = 827. In the year 2002-03 it was high which is favourable for the company but in the year 2003-04 it is same which is favourable for the company but in the year 2004-05 it is lower than 2003-04 &2002-03 which is unfavourable for the company it tells us that company’s payment policy .3 Days and in year 2003-04 is 197. 36 .89 * 360 / 1873.1 Days.3 2003-04 752.49 197. is as follows: Years Creditor Net Purchase DAYS 2002-03 752.89 1873.05 = 159.49 1175.2 2004-05 827.05 159.2 Days and in year 2004-05 is 159.1 Days The Creditor Turnover ratio of Grasim industries Ltd.

56 2003-04 360 197.05 = 159.82 2004-05 360 159.CREDITOR TURNOVER RATIO FORMULA: 360 / CREDITOR RATIO Creditor Turnover ratio of 2004-05 Creditor Turnover ratio = 827.89 * 360 / 1873. is as follows: Years Days Creditor ratio Times 2002-03 360 230.2 1.1 2.1 Days The Creditor Turnover ratio of Grasim industries Ltd.3 1.26 37 .

Therefore.63:1 2004-05 6229.FIXED ASSETS TURNOVER RATIO Assets are used to generate sales. 2002-03 4606. The relationship between sales and fixed assets is known as Fixed Assets turnover ratio.94:1 38 .21 3195.94:1 The Fixed Assets Turnover ratio of Grasim industries Ltd. a firm should manage its assets efficiently to maximize sales. FORMULA: NET SALES / NET FIXED ASSETS Fixed Assets Turnover ratio of 2004-05 Fixed Assets Turnover ratio = 6229.26 3194. is as follows: Years Net Sales Net FA Times Interpretation: This ratio indicates the efficiency with which the company’s fixed assets are used and the company has increased its utilization of fixed assets in the year 2004-05 which is a good sign but this should be compared with the industry average so as to be able to determine the actual position.70 1.81 1.20 3245.41:1 2003-04 5213.81 = 1.03 1.26/3194.

23:1 39 .74 = 1.11:1 2004-05 6229. Total Assets Turnover ratio of 2004-05 Total Assets Turnover ratio = 6229.23:1 The Total Assets Turnover ratio of Grasim industries Ltd.20 4740.71 1.26 5048. FORMULA: NET SALES / TOTAL ASSETS Total Assets: Fixed Assets + Investments + Current Assets.21 4691.62 0. This ratio shows the firms ability in generation sales from all financial resources committed to the total assets. is as follows: Years Net Sales Total Assets Times 2002-03 4606.TOTAL ASSETS TURNOVER RATIO The firm should manage its assets efficiently to maximize its sales as assets are primarily used to generate sales.74 1. For this purpose some analyst compute Total Assets ratio.26/5048.97:1 2003-04 5213.

71/91689485 = 96. Although EPS is a measure of profitability of the firm from the owner’s point of view.60 40 .58 91689485 40.EARNING PER SHARE (EPS) This ratio measures the profit available to the equity shareholders on a per share basis. is as follows: Years PAT(In Crores) No.60 The Earning per Share of Grasim industries Ltd.26 91689485 84.71 91689485 96.09 2002-03 779. that is. of Shares EPS (FV Rs 10 Each) 2001-02 367. Earning per share is a widely used ratio.99 2003-04 885. the amount that they can get on every share held. should be used cautiously as it does not recognized effect of increase in equity capitals a result of retention of earning. FORMULA: PAT / NUMBER OF EQUITY SHARE Earning per Share of 2004-05 Earning per Share = 885.

Pie Chart Of Earning Per Share 18% 44% 2002-2003 2003-2004 2004-2005 38% 41 .

given the fact that absolute figures of two firms of the same industry are not comparable.COMMON SIZE STATEMENT INTRODUCTION Apart from ratio analysis. Basically. another useful way of analysing financial statement is to convert them into common size statement by expressing absolute rupee amounts into percentages. each individual asset and liability classification is shown as a percentage of total assets and liabilities respectively. 42 . and net sales taken as 100 per cent. These statements can be equally useful for inter – firm comparisons. it involves in converting the figures expressed in absolute rupee amounts in percentages. Similarly. assets and liabilities. METHOD OF MAKING A COMMON SIZE STATEMENT Under this method the income statement exhibits each expense item or group of expense items as a percentage of net sales. Common size comparative statement prepared for one firm over the years would highlight the relative change in each group of expenses.

03 25.42 9. Loans.45 0.87 612.COMMONSIZE BALANCE SHEET FOR THE YEAR ENDED 31STMARCH 2003 PARTICULARS SOURCES OF FUNDS Shareholders’ Funds: Share Capital Share Capital Suspense Reserves and Surplus Total LOAN FUNDS Secured Loans Unsecured Loans Documentary bills discounted with banks Total Deffered tax liabilities Total APPLICATION OF FUNDS: Fixed Assets: Gross block Less: Depreciation Net block Capital W/P Total Fixed assets held for disposal Investments: Current Assets.86 539.01 100 96.14 0.11 3156.42 26.02 2885.11 415.02 3245.90 1495.55 11.65 110.567 57.441 31.67 0.74 5678.323 26.81 52.295 15. Advances: Inventories Sundry Debtors Cash & Bank Interest accrued on investment Loans & Advances Total Less: Current Liabilities & Provisions Liabilities Provision Total Net Current Assets Total 31-03-2003 % 91.07 625.88 5486.938 7.565 1.38 882.62 2977.633 36.12 2330.05 539.03 55.31 1500.508 7.57 1.78 100 43 .33 13.54 10.01 89.88 1.95 429.60 41.06 1796.95 2076.0003 50.61 752.49 130.50 5678.62 9.25 2.495 0.26 35.

357 40.80 709.67 0.253 50.83 1327.45 0.682 3.78 52.0003 55.02 3519.46 484.02 100 90.23 632.61 79.27 7.44 1496.44 41.449 32.03 49.65 0.50 6308.92 3116.63 227.64 6308.14 3610.34 2065.283 7.92 3.70 22.27 946.56 1.10 194. Loans.05 11.48 324.65 459.40 1.56 5705.712 100 44 .142 23.57 2540.09 3195.73 10.71 11.09 28.605 5.37 549.23 21. Advances: Inventories Sundry Debtors Cash & Bank Interest accrued on investment Loans & Advances Total Less: Current Liabilities & Provisions Liabilities Provision Total Net Current Assets Total 31-03-2004 % 91.00 8.079 15.COMMONSIZE BALANCE SHEET FOR THE YEAR ENDED 31STMARCH 2004 PARTICULARS SOURCES OF FUNDS Shareholders’ Funds: Share Capital Share Capital Suspense Reserves and Surplus Total LOAN FUNDS Secured Loans Unsecured Loans Documentary bills discounted with banks Total Deferred tax liabilities Total APPLICATION OF FUNDS: Fixed Assets: Gross block Less: Depreciation Net block Capital W/P Total Fixed assets held for disposal Investments: Current Assets.24 0.53 2588.01 752.

73 2982.02 678.74 100 COMMONSIZE PROFIT & LOSS ACCOUNT FOR YEAR ENDED 31ST MARCH 2003 (Rs.724 0.02 535.104 46.89 820.0002 61.783 7.19 1.81 13.02 4236.249 0.59 522.63 6936.08 62.41 1108.01 41.COMMONSIZE BALANCE SHEET FOR THE YEAR ENDED 31STMARCH 2005 PARTICULARS SOURCES OF FUNDS Shareholders’ Funds: Share Capital Share Capital Suspense Reserves and Surplus Total LOAN FUNDS Secured Loans Unsecured Loans Documentary bills discounted with banks Total Deferred tax liabilities Total APPLICATION OF FUNDS: Fixed Assets: Gross block Less: Depreciation Net block Capital W/P Total Fixed assets held for disposal Investments: Current Assets.34 599.54 2008. In crores ) 45 .04 2848.153 26.06 43.30 745.643 100 85.54 1853.19 5897.483 28.79 33.35 1439.70 1. Loans. Advances: Inventories Sundry Debtors Cash & Bank Interest accrued on investment Loans & Advances Total Less: Current Liabilities & Provisions Liabilities Provision Total Net Current Assets Total 31-03-2005 % 91.87 145.94 3194.197 42.67 0.99 9.66 4328.17 3048.40 20.193 4.75 7.32 0.525 1.50 6936.015 8.01 86.95 8.93 827.05 0.042 15.95 2.97 10.09 565.72 1.

PARTICULARS 31-03-2005 % 46 .

00 367.75 450. 4606.299 102.83 91.52 27.990 0.466 .017 32.980 4.81 17.83 100 0.75) 4725.23 713. selling .212 17.58 212.Net Sales (less of excise duty) Interest and dividend income Other income Increase / Decrease in stock INCOME Raw materials consumed Mfg expenses Purchase of finished and other product Payments to & provision for employ Admn.098 1.00 40.43 1175.868 7.02 0.769 20.24 1508.268 0.168) 0.00) 15.54 4012.382 7.91 1244.48 4.20 74.80 (24.716 1.58 (192.00 955.5 25.75 TOTAL EXPENDITURE Profit before tax & exceptional items Profit / (loss) on sale of trade investment Profit Before Tax Provision for current tax Deferred tax Tax provision of earlier years written back Profit After Tax Debenture redemption reserve no longer required Inv.78 9.62) 504.602 2.95 (4.54 58.41 1508.325 0.60 58.31) % 100 2.529 10.20 (208.21 141. In crores ) PARTICULARS Net Sales (less of excise duty) Interest and dividend income Other income Increase / Decrease in stock 47 31-03-2005 5213.67 11.173 87.62 332. Allowance reserve no longer required Balance brought forward from previous year Profit Available for Appropriations APPROPRIATION Proposed dividend Corporate dividend tax General reserve Balance carried to balance sheet COMMONSIZE PROFIT & LOSS ACCOUNT FOR YEAR ENDED 31ST MARCH 2004 ( Rs.10 422.75 1.distribution & other expenses Interest & Dep.10 15.24 819.127 0.44 (13.74 32.01 929.255 9.

INCOME Raw materials consumed Mfg expenses Purchase of finished and other product Payments to & provision for employ Admn.30 15.616 104.20 1784.461 0.05 1498.98 103.30 1372.66 (5.00 790.6 30.distribution & other expenses Interest & Dep. Allowance reserve no longer required Balance brought forward from previous year Profit Available for Appropriations APPROPRIATION Proposed dividend Corporate dividend tax General reserve Balance carried to balance sheet COMMONSIZE PROFIT & LOSS ACCOUNT FOR YEAR ENDED 31ST MARCH 2005 ( Rs.884 15.90 825.842 1.00 779.23 TOTAL EXPENDITURE Profit before tax & exceptional items Profit / (loss) on sale of trade investment Profit Before Tax Provision for current tax Deferred tax Profit After Tax Debenture redemption reserve no longer required Inv.315 16.581) 0.94 4340.67 50.554 20. In crores ) PARTICULARS Net Sales (less of excise duty) Interest and dividend income Other income Increase / Decrease in stock INCOME Raw materials consumed Mfg expenses 48 31-03-2005 6229.162 1.67 6517.806 0.46 426.93 1048.44 100.47 358.12 1873.34 16. 5389.26 20.37 28.8 128.10 0.32 25.23 2.06 24.26 114.06 0.27 955.44 850.188 83.968 6.00) 7.15 34.134 14.75 72.89 1077.26 (219.158 18. selling .94 0.49 1306.26 42.3 26.32 34.41 1784.77 % 100 1.06 .83 8.04 8.

00) 1303.46 423.33 51155.01 2.distribution & other expenses Interest & Dep.13 938.35 (92.354 0.68 27.21 0. TOTAL EXPENDITURE Profit before tax & exceptional items Surplus on pre payment of sales tax loan Provision for diminution in value of invst& loan 49.Purchase of finished and other product Payments to & provision for employ Admn.92 7.06 6.71 (451.795 82.16 790.93 0.335 11.20 1682.002 12.529 14.00 885.786 5.90 700. selling .93 146.76 21.08 27.01 Profit Before Tax Provision for current tax Deferred tax Profit After Tax Debenture redemption reserve no longer required Inv.551 12983752 20.23 13.71 6.36 34. Allowance reserve no longer required Balance brought forward from previous year Profit Available for Appropriations APPROPRIATION Proposed dividend Corporate dividend tax General reserve Balance carried to balance sheet 49 .110 0.00) 33.86 0.989 15.76 1361.240 0.00 815.85 0.02 373.35 1682.68 20.

The firm can make projection of cash inflows and cash outflows to determine the availability of cash. its financial structure(including its liquidity and solvency). it was recommendatory in nature. CASH FLOW STATEMENT PARTICULAR 2002-2003 2003-2004 2004-2005 50 . An analysis of cash flow is useful for short run planning. Financing Activities. 50 crore in a financial year or (II) the shares of which are listed in stock exchange. this statement analysis the changes in non current account as well as current accounts to determine the flow of cash. This statement indicates the sources and uses of cash.CASH FLOW STATEMENT The Institute of Chartered Accountants of India (ICAI) issued the Accounting Standard (AS-3) (revised) relating to the preparation of cash flow statement (CFS) in 1998. The CFS deals with the provision of information about the historical changes in cash and cash equivalents by means of a cash flow statement which classifies cash flows during the period among:    Operating Activities. and its ability to affect the amounts and timing of cash flows in order to adapt to changing circumstances and opportunities. To put in one sentence. A cash flow statement.2001 for enterprises (I) which have either turnover of more than Rs. to pay interest and other expenses and to pay dividends to the shareholders. when used in conjunction with the other financial statements. The economic decisions that are taken by users require an evaluation of the ability of an enterprise to generate cash and cash-equivalents and the timing and certainty of decision of their generation. provides information that enables users to evaluate the changes in net assets of an enterprise. Information about the cash flows of an enterprise is useful in providing users of financial statements with a basis to assess the ability of the enterprise to generate cash and cash equivalents and the needs of the enterprise to utilize those cash flows. Investing Activities. its preparation has been mandatory for accounting periods commencing on or after April 1. A firm needs sufficient cash to pay debts maturing in the near future. Initially.

87) 9.50 (388.15) 3.39) 968.73) (173.65 (1223.32 (796.65 (1006.74) (82.11 1048.88 (55.21) 117.01 5.41 (39.25) (24.46 1050.90) (3.36 168.42 45.13) (150.67) (34.61) (177.37 273.90 (2.94) (38.37 39.76 (75.68 34.84 90.30) 1050.74 1.11) (128.40 (354.37) 1646. Subsidiary & Others Net Proceeds from sale of Current Investment Interest Received Dividend Received Net Cash from/(used in) investment activities (C) Cash Flow from Financing Activities Proceeds from borrowings Repayment of borrowings Interest paid Dividends paid Corporate dividend tax Net Cash from/(used in ) financing activities (D)Net increase/(decrease) in Cash & Cash equivalent Cash &Cash equivalent at beginning of the year Cash &Cash equivalent at end of the year (Cash & Cash equivalent represent Cash & Bank balances) 713.94 1.49 30.16) 666.14 (516.70 51 .26 5.66) (91.32) 0.78) 227.73) (179.72 1.51 (210.79) 1330.38) (39.37) 1070.42 (78.77) (322.07) 53.57) (11.52 (6.76) (1.20 254.28) 80.32 110.06 153.19) (16.28) (87.08 (46.26 1169.36 284.87 (826.91 8.75 1379.57 138.11 227.13 (1294.75) (255.39) 30.28 86.41 1128.49 2.06 (64.28) 1169.76 (391.37 74.29 39.80) (140.14 6.65) 410.44) 326.33) (219.37) (2.64 24.13) 1.37 110.79 55.40 (160.37 (868.48 1361.21) 148.46 19.71 (377.52) 6.96 1441.48 86.28) 597.01 968.(A) Cash Flow from Operating Activities (1)Net Profit before tax &exceptional items Adjustment for: Depreciation Provision for Diminution in Value of Investment Interest expenses Interest Income Dividend Income Profit/Loss on sale of Fixed Assets (Net) Profit on sale of Long Tem Investment (Net) Profit on sale of Current Investment (Net) (2) Operating Profit Before working Capital changes Adjustment for :Trade & Other Receivables Inventories Assets held for disposal Trade Payable (3) Cash generated from Operations Diet Taxes Paid (Net) Cash from operating activities before exceptional item Net Cash from Operating Activities (B) Cash Flow from Investing Activities Sale of Fixed assets Purchase of Investment and fixed assets Sale of Investment Investment/Advances in Joint Venture.

Financial Management (I.  ANNUAL REPORTS.  REFERENCE BOOKS.BIBLIOGRAPHY I have referred to the following books and websites in making the final project.S. c. b.M. a.Pandey). Financial Management (Khan & Jain). SOURCES OF INFORMATION 52 . Annual Reports of Grasim Industries Limited of the year 2004. a. Annual Reports of Grasim Industries Limited of the year 2003. Financial Management (B. b.Shah).

Indian Express Newspaper (Bombay) Ltd.com c. www.google.com b. a. www.indianinfoline. WEBSITES. a. www.com  Articles. grasimindustrieslimited. 53 .

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