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Bharati Vidyapeeth Institute of Management & Research Academic Study Center: BVIMR, New Delhi


This is to certify that SAHIL RAI JAIN of Bharatiya Vidya peeths Institute of Management and Research has successfully completed project report on title FINANCIAL ANALYSIS OF MICROTEK INVERTERS. This project has been done as a partial fulfillment for BACHELORS OF BUSINESS ADMINISTRATION (BBA) course. The student has also made his project to my entire satisfaction and as per requirement of the course. The work has not been anywhere else for the award of degree. All source of information have been duly mentioned.

"Accomplishment of any task necessarily depends upon the willingness and enthusiastic contribution of time and energy of many people." From the starting till the completion of this project, there are many people without whose assistance all my efforts would have been fruitless. I, therefore, acknowledge all who generously helped me by sharing their time, experience and knowledge with me without which this project would have never been accomplished. I extend my profound thanks to DR. S.S.VERNEKAR (BVIMR) for his invaluable guidance and support. I must express my gratitude to ____________________(my project guide) whose perceptive guidance, constant encouragement, constructive criticism and affection were the light of guidance during my tenure of my work. Finally, I would like to state that the project not only fulfilled an academic requirement, but would also help me in future endeavors in the years to come.



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Company Profile
Founded in 1986, MICROTEK INTERNATIONAL PVT. LTD., is the country's Largest Power Products manufacturer having products like Line Interactive UPS, ONLINE UPS, DIGITAL & SINEWAVE INVERTERS/UPS EB/UPS E . Eight manufacturing plants, each specialising in different sphere of the industry has made it possible for Microtek to harness the World's latest technology, perfect it and incorporate it in its product range, for the user's benefit. It is this dedication of mastering its chosen field by continuously upgrading and investing that has won Microtek national awards and international recognition. Microtek has been adjudged SD's No.1 (Inverter & Home UPS) Company of the year. Adjudged being best in Product Quality & After Sales Service in User Satisfaction Survey, 2008. This same has been announced in the Softdisk Issue of Nov. 2008. Microtek has Won SD Award for being Ranked BEST in After Sales Service for ONLINE UPSs below 60KVA and Also the BEST in Case Services for Line Interactive UPS Systems, in SD's User Satisfaction Survey, 2007. Microtek has been awarded 'Channels Choice Silver Award' 2008, for UPS by IDC-Dataquest. IDC-Dataquest survey is conducted in India across 19 cities and 898 channel partners of the country Microtek, was awarded the EFY Readers' Choice Award for the year 2008 , consecutively for the 5th year, having won this award in the years 2004, 2005, 2006 & 2007 also. EFY Awards are chosen by India's Key Research Agency - IMRB & a Jury of Eminent Personalities from amongst the nominees who are known to be prominent players in the market.

Microtek has been receiving Awards regularly to acknowledge its leadership in power products. Microtek was Ranked Best in SD User Satisfaction Survey for Offline / Line Interactive UPS Systems with A++ Rating for the year 2006. Microtek has also been awarded the SMART LIVING AWARD 2005-2006. These awards covering India's Most Preferred Brand (Hamara house hold brand) were conceptualized by 360 Degrees-a subsidiary of The Times of India Group. Further, these awards were decided solely on the basis of a Pan India Consumer Survey conducted by A C Nielson ORG Marg and validated by Price Water House Coopers. Microtek has very strong infrastructural National Network, which is growing rapidly, presently we have 255 Service Points, 28 Service Centers and more than 7000 most dedicated and committed Distributors and Dealers spread all across India, besides its own showrooms and more than 200 exclusive shoppees. Microtek has achieved total customer satisfaction through design, manufacture and supply of quality products. It has now the largest installation base, which is growing at a fastest pace month after month and year after year. With its vast network of well-equipped own Customer Care Centers and the innovative scheme of On-site services, it has won the confidence of Customers.


At MICROTEK-Highly motivated and professionally qualified and experienced world class team of more than 100 professionals in R&D, Production, Quality Control, Servicing and Marketing along with its strong & wide distribution network of more than 7000 channel partners, spread all across India and other countries is strongly dedicated to provide technologically advanced and high quality products.

In pursuit of excellence, Microtek has initiated several group wide quality management processes. Its work culture is now dominated by its quality-movement. All the manufacturing facilities of Microtek have been awarded ISO 9001-2000 Certification. The entire customer support activity is also ISO 9001-2000 Certified.

At Microtek, this International recognition means a never-ending search for perfection and total customer satisfaction.

MICROTEK products have received worldwide acceptance because of its quality & reliability and are exported to many countries. No wonder the products carry many quality approvals.

Microtek has Complete Range of Digital and Sinewave Inverters, UPS EB and UPS E from 400VA to 1550VA, which are designed and developed using world's latest technologies by Microtek's highly professional and experienced in-house R&D team, in technical association with Motorola approved design house in Taiwan and Microchip, USA. Constant & Continuous Regulated Charging technique / Intellicharge Pulse Technology and Dura Retain Technology are the main technologies pioneered in Microtek Inverters /UPS EB/UPS E. Microtek Hi-End Range of Sinewave Inverters from 2KVA to 20KVA, includes models 5.5KVA, 8KVA, 10KVA and 20KVA, specially designed for providing backups to even air-onditioners. These inverters provide pure sinewave form, which is absolutely safe for the appliances connected. The applications include BACKUP for, Airconditioners, Washing Machines, Water Motor, LCD TV, Petrol Pumps, small offices, shopping malls etc. Microtek has Line Interactive UPS models range from 600VA to 1000VA. It also has External Battery models, which have been specially designed for various backup time and multi PC requirements of customers. Microtek has World class Range of ONLINE UPS from 1KVA to 30KVA.

Digital Inverters Sine Wave Inverters UPS EB / UPS E

High-End Inverters Range of Line Interactive UPS External Battery Line Interactive UPS Digital Online UPS from 1KVA to 30KVA. Inverter UPS Specialist Batteries Sealed Maintenance Free (VRLA) Batteries


UPS E Series Latest Aesthetically designed new looks.

UPS EB Series Micro-Controller / DSP Technology Based.

Digital Inverters Latest state-of-the-art Technology for Better Performance and High Reliability.

Hi-End Inverter Series MICRO Processor / DSP based PWM Technology using IGBT.

Line Interactive UPS Highly Reliable range Complete protection of your PC.

ONLINE UPS Uninterrupted Pure Power to Critical applications.

Research & Development

A WORLD CLASS R&D TEAM MICROTEK has In-House R&D, managed by highly motivated, professionally qualified and experienced world class team of professionals, headed by IITians, and is strongly dedicated to provide technologically advanced and high quality products. Microtek's R&D is fully equipped with State-Of-The-Art World Class sophisticated testing equipments. The R&D is continuously working on products development as per changing products usage criteria and for users benefit by making the products more and more efficient. MICROTEK'S R&D HAS MADE SOME NEW TECHNOLOGY BREAKTHROUGHS.....

BATTERY AUTO SENSING: The current models of Microtek Inverters/UPS have New smart Charger design, which automatically adjusts the Battery Cut-off Voltage, which results into Proper Battery Charging, Less Battery Heating and Greater Battery Life. HIGHER INVERTER/UPS EFFICIENCY: Microtek's R&D team has excelled once again. The Inverter/UPS Efficiency will now be 90%. This will result into Less Power Loss, Reduced Heating, Higher Power Output Delivery and LONG BACK-UP. HIGH FREQUENCY INVERTERS/UPS: Coming soon are the New Generation, Transformer less Technology based / Inverters/UPS. Designed for Noiseless and Sinewave Performance. Specially designed to suit Indian Power Conditions. SOLAR INVERTER SERIES: Microtek's R&D Team is working on the future series of Inverters, which will be Solar Charge Controller Inverters. In these models the Efficiency will be as high as 94%. NEW PRODUCTS DEVELOPMENT: Microtek's R&D Team has a exclusive team, fully dedicated for developing new products, which can be more efficient



To be the leading provider of Microtek Inverter services in India and a major global companies.

Expand the frontiers of our business globally. Be the Microtek Inverter of first choice for our customers by delivering high quality, world-class products and services. Play a proactive role in the full realisation of Indias potential. Maintain high standards of governance and ethics. Create value for our stakeholders. Maintain a healthy financial profile and diversify our earnings across businesses and geographies. Contribute positively to the various countries and markets in which we operate.


State-Of-The-Art Manufacturing
MICROTEK Group consists of 8 State-of-the-Art, Most Sophisticated Latest Hi-Tech Plants, Spread all across India, right from Delhi, Sonepat & Gurgaon (Haryana), to Parwanoo (Himachal Pradesh). The Plants are equipped with Most Advanced Machinery imported from Italy, Germany, Japan, Korea and Taiwan. Most of the manufacturing is done by automatic process, thereby leaving least scope of human error. Some of the major machines installed in our plants are, ICT (In Circuit Testing), SMT (Surface Mount Technology), Auto Insertion and various assembly lines for different products. The manufacturing plants, each specialising in different sphere of the industry has made it possible for Microtek to harness the World's latest technology, perfect it and incorporate it in its product range, for the user's benefit. It is this dedication of mastering its chosen field by continuously upgrading and investing that has won Microtek national awards and international recognition. The complete manufacturing process is very consistent and rugged and has been designed in such a way that each product coming out from the production line has to pass through more than 200 Quality Control Checks. INDIA'S FIRST ISO 9001-2000 CERTIFIED MANUFACTURING COMPANY In pursuit of excellence, Microtek has initiated several group wide quality management processes. Its work culture is now dominated by its quality-movement. All the manufacturing facilities of Microtek have been awarded ISO 9001-2000 Certification. At Microtek, this International recognition means a never-ending search for perfection and total customer satisfaction.


"SD's No. 1 (HOME UPS-INVERTER) " Award 2009 Awarded by Soft Disk Magazine
Microtek, has been adjudged SD's No.1 (HOME UPSINVERTER) Company of the Year 2009. Adjusged being Best in Afetr Sales Service for all types of UPS & Inverters in User Satisfaction Survey, 2009.

"EFY Reader's" Choice Award Awarded by Electronics for you Magazine Microtek, has been awarded the EFY Readers Choice Award consecutively for 5 years, from 2004 to 2008. EFY Awards are chosen by India's Key Research Agency - IMRB & a Jury of Eminent Personalities from amongst the nominees who are known to be prominent players in the market.

India's Most Preferred Brand Awarded by The Times of India Group Microtek has also been awarded the SMART LIVING AWARD 2005-2006. These awards covering India's Most Preferred Brand (Hamara house hold brand) were conceptualized by 360 Degrees-a subsidiary of The Times of India Group. Further, these awards were decided solely on the basis of a Pan India Consumer Survey conducted by A C Nielson ORG Marg and validated by Price Water House Coopers.

Best in SD User Satisfaction Survey Award


Awarded by Soft Disk Magazine Microtek was Ranked Best in SD User Satisfaction Survey for Offline / Line Interactive UPS Systems with A++ Rating for the year 2006.

SD Award No.1 Offline UPS Awarded by Soft Disk Magazine Microtek was SD Award for being Ranked No.1 Offline UPS Manufacturer for the performace ending year 2001.

Channels Choice Silver Award 2008 IDC-Dataquest Microtek has been awarded 'Channels Choice Silver Award' 2008, for UPS by IDC-Dataquest. IDCDataquest survey is conducted in India across 19 cities and 898 channel partners of the country.

SD's User Satisfaction Survey 2007 Awarded by Soft Disk Magazine MICROTEK HAS WON SD Award for being Ranked BEST in After Sales Service for ONLINE UPSs below 60KVA. and Also the BEST in Case Services for Line Interactive UPS Systems. in SD's User Satisfaction Survey, 2007.





Ajex & Turner Wiredye Co. Assistant Commissioner Customs Division Association of State Road Transport Undertakings

B.H.E.L - Haridwar

Bank of India

Bhimrao Ambedkar College, DU, Delhi.

Bisleri International Pvt. Ltd. Chief Postmaster CMC Limited

Container Corporation of India Ltd.,

GE Money Financial Services Ltd. GNA Axles Limited Gudex Glass HCL Infosystems Ltd.

Indian Air Force

Indian Grassland Fodder Research Institute Indian Institute of Mass Communication Indian Institute of Technology

Exports Worldwide
MICROTEK products have received worldwide acceptance because of its quality & reliability and are exported to many countries. MICROTEK INDIA'S MOST PREFFERED BRAND' has been regularly exporting its Hi-End range of Sine-Wave Inverters in huge numbers to many countries all across the world, and their performance can be judged by the repeat orders, which we have been receiving continuously. MICROTEK is the Largest Selling Power Products Brand in India. The company's product categories are as:


Our all products meet the world-class quality standards. The prestigious international certification of UL, Awarded to Microtek, which meets US and Canadian norms. The main countries we have been exporting our products are:

South Africa Afghanistan Nepal Iraq 18

Bangladesh U.A.E. Pakistan




Research methodology is a way to systematically solve the research problem. It may be understood as a science of studying how research is done scientifically. Descriptive research study has been chosen for research, because the major objective of descriptive research is to describe something- usually market characteristic or functions. Descriptive research is conducted for the following reasons: Market studies, which describe the size of the market, buying power of the consumers, availability of distributors, and consumer profile. Market share studies, which determine he proportion of total sales received by company and its competitors. Product usage studies, which describe consumption pattern. Sales analysis studies, which describe sales by geographic region, product line, type and size of the account.


To examine the factors causing satisfaction/dissatisfaction in customer. To study the whole sector in different criterion. To know there brand loyalty. To know what make customers stay in a challenging Inverter Industry. To know about which inverter brand people prefer most. To compare the cost and strategies and practices in various other companies and recommend few best ones. To observe the working and workflow of the Microtek Inverter and to know the parameters on which the performance of the organization is measured. To analyze the organization where does it stand in the market?



Extensive survey on customer preferences will provide lot of valuable information about the brand awareness of the product and it will be easy to find out the likes and dislikes about the product. It will give knowledge about the consumer preferences in comparison with other market product and suggest valuable direction of the current market trend. It will provide lot of information about the market trend and customer preferences about the product. It will include valuable suggestions for the company, how the company can strengthen their own brand? The study of customer preferences will provide me lot of information on: How customer profile differs across the user segments? Dopes the different classes of the customers differ their preferences? My study includes an extensive survey over 100 customers who normally use the services. The companies included: MICROTEK Inverter Luminous Inverter Sukam Inverter



Primary as well as secondary data has been used for research study.

Primary sources:
Primary data has been collected through interviewing, administering questionnaires and observing people and phenomena. Questionnaires prepared to collect feedback from Customers. Analysis of the Questionnaires to be done to get the final findings and recommendations.

Secondary Sources:
Secondary data has been collected through internet, newspaper, Performas and Reports of the Company and various magazines..


In case of Primary data, sometimes it was difficult to contact or meet the Professional, due to their busy work schedule. Sometimes, Professionals are unable to furnish some of the information due to confidentiality of the same. Personally contacting the managers of the company involved time and cost. It was difficult to find information that exactly fitted the needs of the project at hand in case of secondary data or information is concerned. Secondary data when collected was invaluable but due to passage of time and with many dynamic changes taking place in the markets, the information losses its value in the current scenario. Being a very sensitive issue, company official were reluctant to give exact pricing policies followed by them. This project report gives a birds view of the marketing strategies adopted by the company. This project doesnt give detailed and deep insight of the marketing strategies. This project report gives only an idea. Company officials are secretive and hesitant about divulging any information whatsoever amount spent on Advertisement and aspects related to Research and Development.



Various points kept in mind before making a project they are as below: Flexibility Development & Modernization Selection of equipment Economically Plan of common work Simplicity Service reliability Safety & Precautions Availability of condition





MEANING: It is a financial statement, which shows net loss of a company for a specified period. The accounting year means calendar year of 12 months or less or more than 12 months. CONTENTS: This presents the revenues and expenses of a company and shows the excess of revenues over expenses for profit and vice versa for a loss. FORMAT: The Companies act does not provide any specific format for this account. However it is required to be prepared on the basis of the instructions given in part ii of schedule (vi) of the companies act. MAIN ITEMS OF PROFIT AND LOSS ACCOUNT Turnover or sales: The aggregate amount of sales and connected items with the sales such as commission paid to sole-selling agents and other selling agents and brokerage and discounts on sales other than usual trade discount. Depreciation: The amount of depreciation of fixed assets and the arrears of depreciation as per section 205(2) shall be disclosed by way of foot-note. Interest on loans and debentures: Interest on loans and debentures has to be stated separately. It will include the amount of interest paid as well as outstanding. Miscellaneous expenses: In this head items such as rates and taxes, insurance premium etc., must be stated separately. Preliminary expenses: Such expenses include the costs of formation of a company and since their amount is usually large, it is not desirable to write off them in one year. Provision for taxation: The profit and loss account of a company must be debited with the estimated liabilities for tax on the current profits at current rates of taxation. Unclaimed dividends: It is shown on the liabilities side of the balance sheet under the heading current liabilities .


Interim dividends: It is an item of appropriation. It is transferred to the debit side of the Profit and loss appropriation account. Final dividend as an item of the trial balance : This is shown in the debit side of the appropriation section of the profit and loss account. Proposed dividend or final dividend proposed: Since it is an adjustment item, it has to be shown at two places- In the debit side of the profit and loss appropriation account and on the liabilities side of the balance sheet under the head current liabilities and provisions. Political donations: It must be shown as a separate item in the profit and loss account. Dividend on interest income: This item is transferred to the credit side of the profit and loss account. Payment to auditors: It must be stated separately . This will include consultancy fee, auditing fees management services etc. Managerial remuneration: This includes the payments made to managerial remuneration directors fee, pension, other allowances and commission.



MEANING: The balance sheet is a financial snapshot of a company's condition at a single point in time. A balance sheet contains a listing of the company's asset, liability and Capital accounts. When someone, whether a creditor or investor, asks you how your company is doing, you'll want to have the answer ready and documented. The way to show off the success of your company is a balance sheet. A balance sheet is a documented report of your company's assets and obligations, as well as the residual ownership claims against your equity at any given point in time. It is a cumulative record that reflects the result of all recorded accounting transactions since your enterprise was formed. You need a balance sheet to specifically know what your company's net worth is on any given date. With a properly prepared balance sheet, you can look at a balance sheet at the end of each accounting period and know if your business has more or less value, if your debts are higher or lower, and if your working capital is higher or lower. By analyzing your balance sheet, investors, creditors and others can assess your ability to meet short-term obligations and solvency, as well as your ability to pay all current and long-term debts as they come due. The balance sheet also shows the composition of assets and liabilities, the relative proportions of debt and equity financing and the amount of earnings that you have had to retain. Collectively, external parties to help assess your companys financial status, which is required by both lending institutions and investors before they will allot any money toward your business, will use this information. LEARN THE DIFFERENT ASSETS Current assets: Current assets include cash and other assets that in the normal course of events are converted into cash within the operating cycle. For example, a manufacturing enterprise will use cash to acquire inventories of materials. These inventories of materials are converted into finished products and then sold to customers. Cash is collected from the customers. This circle from cash back to cash is called an operating cycle. In a merchandising business one part of the cycle is eliminated. Materials are not purchased for conversion into finished products. Instead, the finished products are purchased and are sold directly to the customers. Several operating cycles may be completed in a year, or it may take more than a year to complete one operating cycle. The time required to complete an operating cycle


depends upon the nature of the business. It is conceivable that almost all of the assets that are used to conduct your business, such as buildings, machinery, and equipment, can be converted into cash within the time required to complete an operating cycle. However, your current assets are only those that will be converted into cash within the normal course of your business. The other assets are only held because they provide useful services and are excluded from the current asset classification. If you happen to hold these assets in the regular course of business, you can include them in the inventory under the classification of current assets. Current assets are usually listed in the order of their liquidity and frequently consist of cash, temporary investments, accounts receivable, inventories and prepaid expenses. Cash: Cash is simply the money on hand and/or on deposit that is available for general business purposes. It is always listed first on a balance sheet. Cash held for some designated purpose, such as the cash held in a fund for eventual retirement of a bond issue, is excluded from current assets. Marketable Securities: These investments are temporary and are made from excess funds that you do not immediately need to conduct operations. Until you need these funds, they are invested to earn a return. Accounts Receivable: Simply stated, accounts receivables are the amounts owed to you and are evidenced on your balance sheet by promissory notes. Accounts receivable are the amounts billed to your customers and owed to you on the balance sheet's date. You should label all other accounts receivable appropriately and show them apart from the accounts receivable arising in the course of trade. If these other amounts are currently collectible, they may be classified as current assets. Inventories: Your inventories are your goods that are available for sale, products that you have in a partial stage of completion, and the materials that you will use to create your products. The costs of purchasing merchandise and materials and the costs of manufacturing your various product lines are accumulated in the accounting records and are identified with either the cost of the goods sold during the fiscal period or as the cost of the inventories remaining.


Prepaid expenses: These expenses are payments made for services that will be received in the near future. Strictly speaking, your prepaid expenses will not be converted to current assets in order to avoid penalizing companies that choose to pay current operating costs in advance rather than to hold cash. Often your insurance premiums or rentals are paid in advance. Investments: Investments are cash funds or securities that you hold for a designated purpose for an indefinite period of time. Investments include stocks or the bonds you may hold for another company, real estate or mortgages that you are holding for income-producing purposes. Your investments also include money that you may be holding for a pension fund. Plant Assets: Often classified as fixed assets, or as plant and equipment, your plant assets include land, buildings, machinery, and equipment that are to be used in business operations over a relatively long period of time. It is not expected that you will sell these assets and convert them into cash. Plant assets simply produce income indirectly through their use in operations. Intangible Assets: Your other fixed assets that lack physical substance are referred to as intangible assets and consist of valuable rights, privileges or advantages. Although your intangibles lack physical substance, they still hold value for your company. Sometimes the rights, privileges and advantages of your business are worth more than all other assets combined. Other Assets: During the course of preparing your balance sheet you will notice other assets that cannot be classified as current assets, investments, plant assets, or intangible assets. These assets are listed on your balance sheet as other assets. Frequently, your other assets consist of advances made to company officers, the cash surrender value of life insurance on officers, the cost of buildings in the process of construction, and the miscellaneous funds held for special purposes.


LEARN THE DIFFERENT LIABILITIES Current Liabilities: On the equity side of the balance sheet, as on the asset side, you need to make a distinction between current and long-term items. Your current liabilities are obligations that you will discharge within the normal operating cycle of your business. In most circumstances your current liabilities will be paid within the next year by using the assets you classified as current. The amount you owe under current liabilities often arises as a result of acquiring current assets such as inventory or services that will be used in current operations. You show the amounts owed to trade creditors that arise from the purchase of materials or merchandise as accounts payable. If you are obligated under promissory notes that support bank loans or other amounts owed, your liability is shown as notes payable. Other current liabilities may include the estimated amount payable for income taxes and the various amounts owed for wages and salaries of employees, utility bills, payroll taxes, local property taxes and other services. Long-Term Liabilities: Your debts that are not due until more than a year from the balance sheet date are generally classified as long-term liabilities. Notes, bonds and mortgages are often listed under this heading. If a portion of your long-term debt is due within the next year, it should be removed from the long-term debt classification and shown under current liabilities. Deferred Revenues: Your customers may make advance payments for merchandise or services. The obligation to the customer will, as a general rule, be settled by delivery of the products or services and not by cash payment. Advance collections received from customers are classified as deferred revenues, pending delivery of the products or services. Owner's Equity: Your owner's equity must be subdivided on your balance sheet: One portion represents the amount invested directly by you, plus any portion of retained earnings converted into paid-in capital. The other portion represents your net earnings that are retained. This rigid distinction is necessary because of the nature of any corporation. Ordinarily, stockholders, or owners, are not personally liable for the debts contracted by a company. A stockholder may lose his investment, but creditors usually cannot look to his personal assets for satisfaction of their claims. Under normal circumstances, the stockholders may withdraw as cash dividends an amount measured by the corporate earnings. The distinction in this rule gives the creditors 32

some assurance that a certain portion of the assets equivalent to the owner's investment cannot be arbitrarily withdrawn. Of course, this portion could be depleted from your balance sheet because of operating losses. The owner's equity in an unincorporated business is shown more simply. The interest of each owner is given in total, usually with no distinction being made between the portion invested and the accumulated net earnings. The creditors are not concerned about the amount invested. If necessary, creditors can attach the personal assets of the owners.

BALANCE-SHEET STRUCTURE Basis of balance-sheet: Assets = Liability + Equity The following Balance sheet structure is just an example. It does not show all possible kind of assets, equity and liabilities, but it shows the most usual ones. It could be a consolidated balance sheet. Monetary values are not shown and summary (total) rows are missing as well.


Current Assets Cash and cash equivalents Inventories Account receivable Investment held for trading Other current assets Non-Current Assets Plant and equipment Goodwill Other intangible fixed assets Investment in associates Deferred tax assets Miscellaneous Expenditure Property,

Equity and Liabilities

Capital & Reserve Share capital reserve Revaluation reserve Translation reserve Retained earnings Minority interest Non-Current Liabilities Bank loan Issued debt securities Deferred tax liability


Current Liabilities Accounts payable Current income tax liability Short-term part of bank loans Short-term provisions

4.2.5 EQUITY VALUATION:The real value to a purchaser of the business or a shareholder may be different from the net assets shown by the balance sheet. This is because factors that affect the value of a business may not be recorded yet. For example, a purchaser will be interested in the future earnings of the business, whether assets such as property have been revalued recently, and whether there are potential liabilities in the future such as lawsuits. The value of the assets in the balance has also been based on the assumption that the business is a going concern, otherwise the break-up value of the assets may be far less than the value in the balance sheet.

Title and Heading: In practice, the most widely used title is Balance Sheet; however Statement of Financial Position is also acceptable. Naturally, when the presentation includes more than one time period the title "Balance Sheets" should be used. Heading: In addition to the statement title, the heading of your balance sheet should include the legal name of your company and the date or dates that your statement is presented. For example, a comparative presentation might be headed:


XYZ CORPORATION BALANCE SHEETS December 31, 2008 Format: There are two basic ways that balance sheets can be arranged. In Account Form, your assets are listed on the left-hand side and totaled to equal the sum of liabilities and stockholders' equity on the right-hand side. Another format is Report Form, a running format in which your assets are listed at the top of the page and followed by liabilities and stockholders' equity. Sometimes total liabilities are deducted from total assets to equal stockholders' equity. Captions: Captions are headings within your statement that designate major groups of accounts to be totaled or subtotaled. Your balance sheet should include three primary captions: Assets, Liabilities and Stockholders' Equity. In the report form of presentation, the placement of your primary captions would be as follows: 2006 ASSETS, LIABILITIES AND STOCKHOLDERS EQUITY. Order of Presentation of Captions: First, start with items held primarily for conversion into cash and rank them in the order of their expected conversion. Then, follow with items held primarily for use in operations but that could be converted into cash, and rank them in the order of liquidity. Finally, finish with items whose costs you will defer to future periods or that you cannot convert into cash.



MEANING: Cash flow statement or statement of cash flows is a financial statement that shows a company's incoming and outgoing money (sources and uses of cash) during a time period (often monthly or quarterly). The statement shows how changes in balance sheet and income accounts affected cash and cash equivalents, and breaks the analysis down according to operating, investing, and financing activities. As an analytical tool the statement of cash flows is useful in determining the short-term viability of a company, particularly its ability to pay bills. PURPOSE: The cash flow statement reflects a firms liquidity or solvency. The main purpose to make cash flow statement are as follows: 1. provide information on a firm's liquidity and solvency and its ability to change cash flows in future circumstances 2. provide additional information for evaluating changes in assets, liabilities and equity 3. improve the comparability of different firms' operating performance by eliminating the effects of different accounting methods 4. indicate the amount, timing and probability of future cash flows


The cash flow statement is partitioned into cash flow resulting from operating activities, cash flow resulting from investing activities, and cash flow resulting from financing activities. Operating activities: Operating activities include the production, sales and delivery of the company's product as well as collecting payment from its customers. This could include purchasing raw materials, building inventory, advertising. Investing activities: Investing activities focus on the purchase of the long-term assets a company needs in order to make and sell its products, and the selling of any longterm assets. 37

Financing activities: Financing activities include the inflow of cash from investors
such as banks and shareholders, as well as the outflow of cash to shareholders as dividends as the company generates income. Other activities which impact the long-term liabilities and equity of the company are also listed in the financing activities section of the cash flow statement. Analysis of cash flow statement is necessary for every organisation to depict its cash inflow and outflow.



MEANING: Financial statement analysis is the process of examining relationships among financial statement elements and making comparisons with relevant information. It is a valuable tool used by investors and creditors, financial analysts, and others in their decision-making processes related to stocks, bonds, and other financial instruments. With a great understanding of the balance sheet & profit & loss account and how it is constructed, we can look at some techniques to analyze the information contained within the balance sheet & profit & loss account.

PURPOSE: The main purpose of analyzing the financial statement are the following: To assess past performance and current financial position. To make predictions about the future performance of a company.



1. PERCENTAGE CALCULATION There are two popular methods by which we can analyze the financial statement by calculating percentage as taking a common base. Horizontal Analysis When an analyst compares financial information for two or more years for a single company, the process is referred to as horizontal analysis, since the analyst is reading across the page to compare any single line item, such as sales revenues. In addition to comparing dollar amounts, the analyst computes percentage changes from year to year for all financial statement balances, such as cash and inventory. Alternatively, in comparing financial statements for a number of years, the analyst may prefer to use a variation of horizontal analysis called trend analysis. Trend analysis involves calculating each year's financial statement balances as percentages of the first year, also known as the base year. When expressed as percentages, the base year figures are always 100 percent, and percentage changes from the base year can be determined. If we want to calculate % change in sales then we apply the following formula: Percentage=change in sales /Base Year Sales*100 Vertical Analysis When using vertical analysis, the analyst calculates each item on a single financial statement as a percentage of a total. The term vertical analysis applies because each year's figures are listed vertically on a financial statement. The total used by the analyst on the income statement is net sales revenue, while on the balance sheet it is total assets. This approach to financial statement analysis, also known as component percentages, produces commonsize financial statements. Common-size balance sheets and income statements can be more easily compared, whether across the years for a single company or across different companies. If we want to calculate % change of current assets then we apply the following formula: 40

Percentage: current assets/total assets*100 2. RATIO ANALYSIS Financial ratio analysis uses formulas to gain insight into the company and its operations. For the balance sheet, using financial ratios (like the debt-to-equity ratio) can show you a better idea of the companys financial condition along with its operational efficiency. It is important to note that some ratios will need information from more than one financial statement, such as from the balance sheet and the income statement. Ratio analysis facilitates inter-firm and intra-firm comparison. Ratios are often classified using the following terms: LIQUIDITY RATIO Liquidity ratios are measures of the short-term ability of the company to pay its debts when they come due and to meet unexpected needs for cash. Current Ratio: The current ratio is a rough indication of a firm ability to service its current obligations. Generally, the higher the current ratio, the greater the cushion between current obligations and a firm ability to pay them. The stronger ratio reflects a numerical superiority of current assets over current liabilities Current ratio is calculated as follows: Current ratio= Current Assets/Current Liabilities Quick Ratio: It is also known as the acid test ratio, this is a refinement of the current ratio and is a more conservative measure of liquidity. The quick ratio expresses the degree to which a companys current liabilities are recovered by the most liquid current assets. follows: Quick ratio= (cash + marketable securities + Receivables)/current liabilities quick ratio is calculated as


SOLVENCY RATIO Solvency ratios indicate the ability of the company to meet its long-term obligations on a continuing basis and thus to survive over a long period of time. Debt/Worth Ratio: This ratio expresses the relationship between capital contributed by creditors and that contributed by owners. It expresses the degree of protection provided by the owners for the creditors. The higher the ratio, the greater the risk being assumed by creditors. The lower the ratio, the greater the long-term financial safety. A firm with a low debt/worth ratio usually has a greater flexibility to borrow in the future. A more highly leveraged company has a more limited debt capacity. Debt/worth ratio=Total Liabilities / Tangible Net Worth

PROFITABILITY RATIO Profitability ratios are gauges of the company's operating success for a given period of time. Return On Assets: Return on assets is a measure of how effectively the firms assets are being used to generate profit. It is calculated as follows: Return On Assets= Net Income/Total Assets Return On Equity: Return on equity is the bottom line measure for the shareholders, measuring for the profits earned for each rupee invested in business. It is calculated as follows: Return on Equity= Net income/shareholders equity Fixed/Worth Ratio: This ratio measures the extent to which owners equity (capital) has been invested in plant and equipment (fixed assets). A lower ratio indicates a proportionately smaller investment in fixed assets in relation to net worth and a better cushion for creditors in case of liquidation. Similarly, a higher ratio would indicate the opposite situation. The presence of substantial leased fixed assets (not shown on the balance-sheet ) may deceptively lower this ratio. Fixed Worth Ratio=Net Fixed Assets/ Tangible Net Worth 42



As the world has grown smaller, it is increasingly important to think and acts like a global brand. The need to provide the customer with world quality products, reasonable pricing which suits the customers pocket, efficient services and to take in suggestions and feedback from them so that they can serve in the best possible manner. Microtek Limited, the market leader in the inverter industry came into existence in 1986 and transformed the business of inverters. MICROTEK has more than 112 service points,27 Customer Care centers all across the country, served by qualified service personnel. MICROTEK is the only company to have got all Plants, Servicing, Marketing and entire activities ISO 9001:2000 Certified. The Marketing strategies adopted by the Microtek Limited has been highly competitive and has enable the company to keep a firm grip on the battle ground and fight competition and retain its market share and profits thereafter. My findings are dispersed into 4 Ps of Marketing Mix

In the present business scenario, it has become essential for any growing organization to build a strong presence in the international market. Microtek Limited can proudly claim to have got a foothold in the international market. With differences of culture, language and religion dissolving the wide range of inverters have found an everexpanding market with expatriated abroad. MICROTEK products have received

worldwide acceptance because of its quality & reliability and are exported to many countries.

The main countries we have been exporting our products are:

South Africa , Afghanistan, Nepal , Iraq, Bangladesh , U.A.E. , Pakistan .


PROBLEM STATEMENT To what extent existence of competition, would really affect the overall marketing strategies of the company as well as customers preferences? Will the consumers be attracted towards the product even if the price goes up? What is the actual percentage level of awareness of the customer about the brand and companys marketing strategies and policies?

FUTURE PLANS Microtek International Pvt. Ltd. will be going to launch their mobile phones in the coming years. They have already started working on it.





Customer Satisfaction of Microtek Products

This Survey has been conducted by me with the help of a Questionnaire. First of all, I selected the area where I wanted to base my survey, and I choose places like Pitampura ,Ashok Vihar & Inderlok in Delhi.. Its a Survey and that is why I choose to work for 10 days. Then I tried to convince people to fill the Questionnaire and managed to get 10 people in a total of 2 hours daily. Then, it was up to me to do the analysis and with the help of Diagrammatic Representation; I have tried to present the best project.


QUESTIONNAIRE Q1. Do you have Inverter?


Q 2. Which brand of Inverter do you have?

5 30 35


Q 3. Does Microtek Inverter give Value for your money?


Completely Does not Partially

Q 4. How is the Quality of Microtek Inverter?



Very good Average

Good Poor

Q 5. What would you say about the availability of Microtek inverters?


30 Very good Average Good Poor

Q6. How is the Display of Microtek Inverter?

3 6


Very good Average

Good Poor


Q 7. How is the after sale services of MICROTEK?

5 5


Very good Average

Good Poor


Q8. How is the packaging done at Microtek Inverter?

10 4

1 20
Very good Average Good Poor

Q9. Do you think Microtek Inverter is able to meet up with your demands?



Q 10. Which feature influence you to purchase Microtek Inverter?


5 18
Quality Price Variety

Q11. Are the prices of the Microtek Inverter satisfactory?





Q12. Overall how satisfied are you with Microtek Inverter?


5 0 18
Very satisfied Somewhat dissatisfied Somewhat satisfied Very dissatisfied




The survey shows that maximum people are using inverters in their homes. By the survey it was clear that maximum people use MICROTEK inverter compared to other inverter companies. The survey shows that out of 100 people , 91 people have inverter. Out of 91 people , 35 are using MICROTEK inverter (around 38%),30 are using LUMINIOUS inverter (around 33%) ,21 are using SU-KAM inverter (around 23%) & 5 people are having other inverter brand (around 6%). The survey clearly shows that MICROTEK biggest competitor in inverter segment is LUMINIOUS. The survey shows that out of 35 people that are using MICROTEK inverter , 29 people (around 83%) thinks that MICROTEK inverters completely gives value for their money and rest of the people thinks that MICROTEK inverter partially gives value for their money. There is no one out of these people that thinks MICROTEK inverter does not gives value for their money. The survey also shows that out of 35 people that are using MICROTEK inverter,21 people believes that the quality of MICROTEK inverter is very good (around 60%),7 thinks that the quality of MICROTEK inverter is good & rest of the people believes that the quality of MICROTEK inverter is average. The survey also shows that availability of MICROTEK inverter to the customers is good. Out of 35 people,32 people thinks (around 91%) that MICROTEK Inverter is able to meet up with their demands. Also 18 people out of 35 (around 51%) purchased MICROTEK inverter because of its good quality,12 people (around 34%) purchased it because of its economical price and rest purchased it because of different varieties of MICROTEK inverter. The survey also shows that out of 35 people , 26 people (around74%) are satisfied with the prices of MICROTEK inverter and 9 are not satisfied. Out of 35 people,18 people (around 51.5%) are overall very satisfied with MICROTEK inverter,12 people (around 34.5%) are somewhat satisfied and 5 people (around 14%) are dissatisfied. Overall, it is shown that the customers are Somewhat Satisfied as there is a majority of people which think that ways. But still it is less than totally satisfied, and it is important to look at the reasons for that .





In the field of concept selling by using the ideas and by inventions / imagination/psychological and cultural fields, Microtek have mixed up various human sentiments and created an altogether mixed market where they are able to promote and incash benefits for themselves as well for building different human/socio relations. This is a very clear cut picture where a team of hard core professionals are using every opportunity directly touching the emotions of the people but spending minimum money possible on advertisement. It is a sort of monopolistic area where by spending very low, using easiest and economical method, products are developed and sold, giving, the customers no chance or alternative.


Some of the recommendation and suggestion are as follows: o The attention is required on the areas of growth, profitability ,service level and building talent. o To increase the profit of Microtek, Microtek should decrease their operating expenses and increase their income. o To increase its liquidity, Microtek should keep some more cash in its hand instead of giving more and more advances. o Introduce quality consciousness and standardization of the work system and procedures. o Make manager competitive and introduce spirit of market-orientation and culture of working for customer satisfaction. o There is need to build the knowledge and skill base among the employees in the context of technology. o Performance measure should not only cover financial aspects i.e. quantitatively aspects but also the qualitative aspects. o It is high time to focus on work than the work-achieved. o Microtek should increase its retail portfolio. o Microtek should manage its all risk such as credit, market and operational risk properly and should be managed by a person who are highly skilled and qualified.


. 1) They should now concentrate more on their product which are not showing good sales and should discontinue them if see constant losses, newer products to be introduced on their place. 2) To have some kind of control on their diversification to have a perfect production / consumption ratio.




Date-_________ Place-________

Name-________________________________________________ Address-______________________________________________ Age-___________ Ph.-______________ E-Mail ______________________________________________

Q1. Do you have Inverter? a. YES b. NO

Q 2. Which brand of Inverter do you have? a. MICROTEK d. OTHER b. SU-KAM c. LUMINIOUS

Q3. Does Microtek Inverter give Value for your money? a. Completely b. Partially c. Does not

Q4. How is the Quality of Microtek Inverter? a. Very good b. Good c. Average d. Poor

Q5. What would you say about the Availability of Microtek Inverter? a. Very good b. Good c. Average d. Poor

Q6. How is the display of Microtek Inverter? a. Very good b. Good c. Average d. Poor 61

Q 7. How is the after sale services of MICROTEK? a. Very good b. Good c. Average d. Poor

Q8. How is the Packaging done at Microtek Inverter? a. Very good b. Good c. Average d. Poor

Q9. Do you think Microtek Inverter is able to meet up with your demands? a. Yes b. No

Q 10. Which feature influence you to purchase Microtek Inverter? a. Quality b. Price c. Variety

Q11. Are the prices of the Microtek Inverter satisfactory a. Yes b. No

Q12. Overall how satisfied are you with Microtek Inverter? a. Very satisfied c. Somewhat dissatisfied b. Somewhat satisfied d. Very dissatisfied

If you were less than totally satisfied, what could have been done to serve you better? _____________________________________________________________________ _____________________________________________________________________ _____________________________________________________________________ ______


Any other Suggestions _____________________________________________________________________ _____________________________________________________________________ ____________________________





Text Marketing Management Philip Kotler Marketing Research Philip Kotler

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