A STUDY ON LEVERAGE IN SAI LEAF PLATE INDUSTRY - KARUR.

CHAPTER-I

INTRODUCTION
The Project has been done in SAI LEAF PLATE INDUSTRY – KARUR. The title of
the project is “A Study on the Leverage. The study starts with a Company’s profile and also the
need for study, review of literature and objectives are set out for the study. Research
methodology, Data analysis & Interpretation, Findings and Suggestions of the study follow.
One of the main areas of the project is the analysis part, where the data are analyzed &
interpreted, to find out the leverage. Some of the tools used in leverage are regarding to:

 Ratio Analysis
 Comparative Financial Statements.
 Trend Analysis.
And then conclusions, limitations & scope for further study were discussed

Leverage is the capital required for maintenance of day-to-day business operations. The
present day competitive market environment calls for an efficient management of leverage. The
reason for this is attributed to the fact that an ineffective leverage may force the firm to stop its
business operations, may even lead to bankruptcy. Hence the goal of leverage is not just
concerned with the management of current assets & current liabilities but also in maintaining a
satisfactory level of leverage.

DEFINITION:
Leverage is formally arrived at by subtracting the current liabilities from current assets of
a firm on the day the balance sheet is drawn up. Leverage is also represented by a firm’s net
investment in current assets necessary to support its everyday business. Leverage frequently
changes its form and is sometimes also referred to as circulating capital. According to
Grettenberger: “circulating capital means current assets of a company that are changed in the
ordinary course of business from one form to another.”
TYPES OF LEVERAGE
Leverage, as mentioned above, can take different forms. For example, it can take the
form of cash and then change to inventories and/or receivables and back to cash.
Gross and Net Leverage:
The total of current assets is known as gross leverage whereas the difference between the
current assets and current liabilities is known as the net leverage.
Permanent Leverage:
This type of leverage is the minimum amount of leverage that must always remain
invested. In all cases, some amount of cash, stock and/or account receivables are always locked
in. These assets are necessary for the firm to carry out its day to day business. Such funds are
drawn from long term sources and are necessary for running and existence of the business.
Variable Leverage:
Leverage requirements of a business firm might increase or decrease from time to time
due to various factors. Such variable funds are drawn from short-term sources and are referred to
as variable leverage.
Leverage, also known asset leverage or NWC, is a financial metric which represents
operating liquidity available to a business. Along with fixed assets such as plant and equipment,
leverage is considered a part of operating capital. It is calculated as current assets minus current
liabilities. If current assets are less than current liabilities, an entity has a leverage deficiency,
also called a leverage deficit.

A company can be endowed with assets and profitability but short of liquidity if its assets
cannot readily be converted into cash. Positive leverage is required to ensure that a firm is able to
continue its operations and that it has sufficient funds to satisfy both maturing short-term debt
and upcoming operational expenses. The management of leverage involves managing
inventories, accounts receivable and payable and cash.
The present research seeks to study in depth the Leverage of selected paper companies in
India, with special emphasis on an examination of the management performance in regard to
financial management. It hardly needs mentioning that inventory, accounts receivables and cash
and its alert administration can go a long way in solving the problem of the efficient leverage. In
fact, the present research of leverage needs special attention for the efficient leverage and the
business. It has been often observed that the shortage of leverage leads to the failure of a
business. The proper management of leverage may bring about the success of a business firm.
The management of leverage includes the management of current assets and current liabilities.
The present research undertakes to deal with the net concept of leverage: excess of current assets
over current liabilities.
A number of companies for the past few years have been finding it difficult to solve the
increasing problems of adopting seriously the management of leverage. Business concerns intent
on developing their business have to use to the most, their available resources for the
improvement and development of the business there by enabling them to increase their profits.
Leverage and change in leverage, especially in inventories, which is one of the components of
leverage form a very important part of the total gross-capital formation in the paper companies.
Efficient and the optimal utilization of fixed assets are very closely related to the proper
management of leverage. The present research attempts to recognize initially the importance of
leverage as a part of the total capital. It further goals to recognize the factors influencing the
leverage, its volume, and in the process try to suggest remedial measures which might help in
optimizing the use of leverage. It also considers as to how precisely “financing leverage” and
further more what should be mix of different components of leverage.
Holding of current assets in substantial amount strengthens the liquidity position &
reduces the riskiness but only at the expense of profitability. Therefore achieving risk-return
trade-off is significant in holding of current assets. While cash outflows are predictable it runs
contrary in case of cash inflows. Sales program of any business concern does not bring back cash
immediately. There is a time lag that exists between sale of goods & sales realization. The capital
requirement during this time lag is maintained by leverage in the form of current assets. The
whole process of this conversion is explained by the operating cycle concept.

Leverage involves the relationship between a firm's short-term assets and its short-term
liabilities. The goal of leverage is to ensure that a firm is able to continue its operations and that
it has sufficient ability to satisfy both maturing short-term debt and upcoming operational
expenses. The management of leverage involves managing inventories, accounts receivable and
payable, and cash.
 There are many ratios that can be calculated from the financial statements
pertaining to a company's performance, activity, financing and liquidity. Some common ratios
include the price-earnings ratio, debt-equity ratio, earnings per share, asset turnover and
leverage.

Leverage is the life blood of every business concern. Business firm cannot make progress
without adequate leverage. Inadequate leverage means shortage of inputs, whereas excess of it
leads to extra cost. So the quantum of leverage in every business firm should be neither more nor
less than what is actually required. The management has to see that funds invested as leverage in
their organization earn return at least as much as they would have earned return if it invested
anywhere else. At the time of increasing capital costs and scare funds, the area of leverage
assumes added importance as it deeply influences a firm's liquidity and profitability. A notable
feature of utilization of funds is that they are of recurring nature.
Therefore, efficient leverage requires a proper balance between generation and utilization
of these funds without which either shortage of funds will cause obstruction in the smoother
functioning of the organization or excess funds will prevent the firm from conducting its
business efficiently.
So the main objective of leverage is to arrange the needed funds on the right time from
the right source and for the right period, so that tradeoff between liquidity and profitability may
be achieved.

Another important aspect of leverage is to analyze the total leverage needs of the firm in
order to find out the permanent and temporary leverage. Leverage is required because of
existence of operating cycle. The lengthier the operating cycle, greater would be the need for
leverage. The operating cycle is a continuous process and therefore, the leverage is needed
constantly and regularly. However, the magnitude and quantum of leverage required will not be
same all the times, rather it will fluctuate.

The need for current assets tends to shift over time. Some of these changes reflect
permanent changes in the firm as is the case when the inventory and receivables increases as the
firm grows and the sales become higher and higher. Other changes are seasonal, as is the case
with increased inventory required for a particular festival season. Still others are random
reflecting the uncertainty associated with growth in sales due to firm's specific or general
economic factors.

THE LEVERAGE NEEDS CAN BE BIFURCATED AS:

Permanent leverage
Temporary leverage

Permanent leverage:
There is always a minimum level of leverage, which is continuously required by a firm in
order to maintain its activities. Every firm must have a minimum of cash, stock and other current
assets, this minimum level of current assets, which must be maintained by any firm all the times,
is known as permanent leverage for that firm. This amount of leverage is constantly and
regularly required in the same way as fixed assets are required. So, it may also be called fixed
leverage.

Temporary leverage:
Any amount over and above the permanent level of leverage is temporary, fluctuating or
variable leverage. The position of the required leverage is needed to meet fluctuations in demand
consequent upon changes in production and sales as a result of seasonal changes.

The permanent level is constant while the temporary leverage is fluctuating increasing
and decreasing in accordance with seasonal demands as shown in the figure.
In the case of an expanding firm, the permanent leverage line may not be horizontal. This
is because the demand for permanent current assets might be increasing (or decreasing) to
support a rising level of activity. In that case line would be risin
FINANCING OF LEVERAGE

There are two types of leverage requirements as discussed above. They are:
Permanent or Fixed Leverage requirements
Temporary or Variable Leverage requirements
Therefore, to finance either of these two leverage requirements, we have long-term as
well as short-term sources.

LEVERAGE CYCLE
The upper portion of the diagram above shows in a simplified form the chain of events in
a manufacturing firm. Each of the boxes in the upper part of the diagram can be seen as a tank
through which funds flow. These tanks, which are concerned with day-to-day activities, have
funds constantly flowing into and out of them.
o The chain starts with the firm buying raw materials on credit.
o In due course this stock will be used in production, work will be carried
out on the stock, and it will become part of the firm’s work-in-progress.
o Work will continue on the WIP until it eventually emerges as the finished
product.
o As production progresses, labor costs and overheads need have to be met.
o Of course at some stage trade creditors will need to be paid.
o When the finished goods are sold on credit, debtors are increased.
o They will eventually pay, so that cash will be injected into the firm.

 Each of the areas- Stock (raw materials, WIP, and finished goods), trade debtors,
cash (positive or negative) and trade creditors – can be viewed as tanks into and
from which funds flow.
 Leverage is clearly not the only aspect of a business that affects the amount of
cash.
 The business will have to make payments to government for taxation.
 Fixed assets will be purchased and sold
 Lessons of fixed assets will be paid their rent
  Shareholders (existing or new) may provide new funds in the form of cash
 Some shares may be redeemed for cash
 Dividends may be paid
 Long-term loan creditors (existing or new) may provide loan finance, loans will
need to be repaid from time-to-time, and
 Interest obligations will have to be met by the business
 Unlike, movements in the leverage items, most of these ‘non-leverage’ cash
transactions are not every day events. Some of them are annual events (e.g. tax
payments, lease payments, dividends, interest and, possibly, fixed asset purchases
and sales). Others (e.g. new equity and loan finance and redemption of old equity
and loan finance) would typically be rarer events.

STATEMENT OF THE PROBLEM:

Leverage constitutes part of the Crown's investment in a department. Associated with this
is an opportunity cost to the Crown. (Money invested in one area may "cost" opportunities for
investment in other areas.) If a department is operating with more leverage than is necessary, this
over-investment represents an unnecessary cost to the Crown.

OBJECTIVES OF THE STUDY

The objectives of the study are as follows:

 To analyze the leverage of the company.

 To determine the gross and net operating cycle of the unit.
 To know the future need of leverage in the running organization.
 To render recommendations for the effective management of leverage.
SCOPE OF THE STUDY

The study of W.C. management is purely based on secondary data and all the information is
available within the company itself in the form of records. To get proper understanding of this
concept, I have done the study of the balance sheets, profit and loss A/C’s, cash accounts, trial
balance, and cost sheets.. So, scope of the study is limited up to the availability of official
records and information provided by the employees. The study is supposed to be related to the
period of last five years.
 CHAPTER II

REVIEW OF LITERATURE

REVIEW OF LITERATURE

 The research done by Pass C.L., Pike R.H., “An overview of leverage and corporate
financing”,(1984) describes that over the past 40 years major theoretical developments
have occurred in the areas of longer-term investment and financial decision making.
Many of these new concepts and the related techniques are now being employed
successfully in industrial practice. By contrast, far less attention has been paid to the area
of short-term finance, in particular that of leverage. Such neglect might be acceptable
were leverage considerations of relatively little importance to the firm, but effective
leverage has a crucial role to play in enhancing the profitability and growth of the firm.
Indeed, experience shows that inadequate planning and control of leverage is one of the
more common causes of business failure.

 The research done by Herrfeldt B., “How to Understand Leverage” describes that“Cash is
king”--so say the money managers who share the responsibility of running this country's
businesses. And with banks demanding more from their prospective borrowers, greater
emphasis has been placed on those accountable for so-called leverage. Leverage refers to
the management of current or short-term assets and short-term liabilities. In essence, the
purpose of that function is to make certain that the company has enough assets to operate
its business. Here are things you should know about leverage.
 The research done by, Samiloglu F. and Demirgunes K., “The Effect of Leverage on
Firm Profitability: Evidence from Turkey” (2008) describes that the effect of leverage on
firm profitability. In accordance with this aim, to consider statistically significant
relationships between firm profitability and the components of cash conversion cycle at
length, a sample consisting of Istanbul Stock Exchange (ISE) listed manufacturing firms
for the period of 1998-2007 has been analysed under a multiple regression model.
Empirical findings of the study show that accounts receivables period, inventory period
and leverage affect firm profitability negatively; while growth (in sales) affects firm
profitability positively.
 The research done by, Appuhami, Ranjith B A, “The Impact of Firms' Capital
Expenditure on Leverage: An Empirical Study across Industries in Thailand” ,
International Management Review,(2008), The purpose of this research is to investigate
the impact of firms' capital expenditure on their leverage. The author used the data
colleted from listed companies in the Thailand Stock Exchange. The study used Shulman
and Cox's (1985) Net Liquidity Balance and Leverage Requirement as a proxy for
leverage measurement and developed multiple regression models. The empirical research
found that firms' capital expenditure has a significant impact on leverage. The study also
found that the firms' operating cash flow, which was recognized as a control variable, has
a significant relationship with leverage.
 The research done by, Hardcastle J., “Leverage”,(2007) describes that Leverage,
sometimes called gross leverage, simply refers to the firm's total current assets (the short-
term ones), cash, marketable securities, accounts receivable, and inventory. While long-
term financial analysis primarily concerns strategic planning, leverage deals with day-to-
day operations. By making sure that production lines do not stop due to lack of raw
materials, that inventories do not build up because production continues unchanged when
sales dip, that customers pay on time and that enough cash is on hand to make payments
when they are due. Obviously without good leverage, no firm can be efficient and
profitable.
 The research done by, Thachappilly G., “Leverage Manages Flow of Funds”,(2009)
describes that Leverage is the cash needed to carry on operations during the cash
conversion cycle, i.e. the days from paying for raw materials to collecting cash from
customers. Raw materials and operating supplies must be bought and stored to ensure
uninterrupted production. Wages, salaries, utility charges and other incidentals must be
paid for converting the materials into finished products. Customers must be allowed a
credit period that is standard in the business. Only at the end of this cycle does cash flow
in again.The research done by, Beneda, Nancy; Zhang, Yilei, “Leverage, Growth and
Performance of New Public Companies”.

 The research done by, Dubey R.,“Leverage-an Effective Tool for Organisational
Success” (2008) describes that The leverage in a firm generally arises out of four basic
factors like sales volume ,technological changes, seasonal , cyclical changes and policies
of the firm. The strength of the firm is dependent on the leverage as discussed earlier but
this leverage is inteslf dependent on the level of sales volume of the firm. The firm
requires current assets to support and maintain operational or functional activities. By
current assets we mean the assets which can be converted readily into cash say within a
year such as receivables, inventories and liquid cash. If the level of sales is stable and
towards growth the level of cash, receivables and stock will also be on the high.

 The research done by, McClure B., “Leverage Works” describes that Cash is the lifeline
of a company. If this lifeline deteriorates, so does the company's ability to fund
operations, reinvest and meet capital requirements and payments. Understanding a
company's cash flow health is essential to making investment decisions. A good way to
judge a company's cash flow prospects is to look at its leverage (WCM). Cash is king,
especially at a time when fund raising is harder than ever. Letting it slip away is an
oversight that investors should not forgive. Analyzing a company's leverage can provide
excellent insight into how well a company handles its cash, and whether it is likely to
have any on hand to fund growth and contribute to shareholder value.
 The research done by, Gass D., “How To Improve Leverage” (2006) "Cash is the
lifeblood of business" is an often repeated maxim amongst financial managers. Leverage
refers to the management of current or short-term assets and short-term liabilities.
Components of short-term assets include inventories, loans and advances, debtors,
investments and cash and bank balances. Short-term liabilities include creditors, trade
advances, borrowings and provisions. The major emphasis is, however, on short-term
assets, since short-term liabilities arise in the context of short-term assets. It is important
that companies minimize risk by prudent leverage.

 The research done by, Maynard E. Rafuse, “ Leverage: an urgent need to refocus”
Management Decision, (1996) Argues that attempts to improve leverage by delaying
payment to creditors is counter-productive to individuals and to the economy as a whole.
Claims that altering debtor and creditor levels for individual tiers within a value system
will rarely produce any net benefit .Proposes that stock reduction generates system-wide
financial improvements and other important benefits .Urges those organizations seeking
concentrated leverage reduction strategies to focus on stock management strategies based
on “lean supply-chain” techniques.
Empirical Study
 Sushma Vishnani, Bhupesh Kr. Shah (2007)It is felt that there is the need to study the
role of leverage policies onprofitability of a company. Conventionally, it has been seen
that if a company desires to take a greater risk for bigger profits and losses, it
reduces the size of its leverage in relation to its sales. If it is interested in improving its
liquidity, it increases the level of its leverage.
 However, this policy is likely to result in a reduction of the sales volume, therefore of
profitability. Hence, a company should strike a balance between liquidity and
profitability. In this paper an effort has been made to make an empirical study of Indian
Consumer Electronics Industry for assessing the impact of leverage policies & practices
on profitability during the period 1994–95 to 2004–05. The impact of leverage policies
on profitability has been examined by computing coefficient of correlation and regression
analysis between profitability ratio and some key leverage policy indicator ratios.
Leverage and Financial Management Practices in the Small Firm Sector
 Michael J. Peel, Nicholas Wilson (2008)MICHAEL J. PEEL IS A LECTURER IN
accountancy and finance at Cardiff Business School, University of Wales and Nicholas
Wilson is Professor of Credit Management at the University of Bradford,
England. Very little research has been conducted on the capital budgeting and leverage
practices of small firms. The purpose of this paper is to present the results of a
preliminary study on the leverage and financial management practices of a sample of
small firms located in the north of England. In general, the results of the survey indicated
that a relatively high proportion of small firms in the sample claimed to use quantitative
capital budgeting and leverage techniques and to review various aspects of their
companies' leverage. In addition, the firms which claimed to use the more sophisticated
discounted cash flow capital budgeting techniques, or which had been active in terms of
reducing stock levels or the debtors' credit period, on average tended to be more active in
respect of leverage practices. It hoped that the issues raised would stimulate further
theoretical and empirical contributions on this neglected and important area of small
business research.

RESEARCH METHDOLOGY

The term research refers to the systematic method consisting of enunciating the problem ,
formulating a hypothesis collecting the data , analyzing the facts and reaching the certain
conclusions either in the form of solution towards the concern problem or in certain
generalization for some theoretical formulation .

Research Methodology is a way to solve systematically the research problem .It may be
understood as a science of studying how research is done scientifically.

RESEARCH DESIGN:

Descriptive research procedure is used for describing the recent situations in the organization and
analytical research to analyze the results by using research tools.
DESCRIPTIVE RESEARCH:

Descriptive research, also known as statistical research, describes data and characteristics
about the population or phenomenon being studied. Descriptive research answers the
questions who, what, where, when and how...

Although the data description is factual, accurate and systematic, the research cannot describe
what caused a situation. Thus, Descriptive research cannot be used to create a causal
relationship, where one variable affects another. In other words, descriptive research can be said
to have a low requirement for internal validity.

In short descriptive research deals with everything that can be counted and studied. But there
are always restrictions to that. Your research must have an impact to the lives of the people
around you. For example, finding the most frequent disease that affects the children of a town.
The reader of the research will know what to do to prevent that disease thus, more people will
live a healthy life.
DATA SOURCE & COLLECTION METHODS:

There are two types for collecting data

1. Primary data
2. Secondary data

SECONDARY DATA:

Secondary data are those which have already been collected by someone else and
which have already been passed through the statistical process. The Secondary data consist of
reality available companies already complied statistical statements. Secondary data consists of
not only published records and reports but also unpublished records.

Here we done the analysis on basis of secondary data, which included-

 Balance sheet of company

 Profit and loss A/C
 Cost sheets, & Trail balance of five years
PURPOSE:

The purpose of this paper is to properly analysis of the leverage of SAI LEAF PALTE
INDUSTR– KARUR.

over the period 2011-2016.

TOOLS USED:

I used the different tools to analyze the leverage

Analysis through Leverage ratios

 Analysis through Schedule change in leverage

 Analysis through Gross operating cycle & Net operating cycle
 Analysis through Various components of leverage

LIMITATIONS OF THE STUDY

 As central purchase office, purchase raw material and central marketing yarn make sales.
Information that is so more detailed cannot be received about these.
Cash from debtors a collected by the corporate office through commission agents. So efforts for
collection of debtors cannot be clearly known from SAI LEAF PLATE INDUSTRY -
KARUR.
 Investment of funds are also made by corporate office, so it becomes difficult to know
that how much investment is made in different ways for continuous availability of funds.
 CHAPTER-II

INDUSTRY PROFILE

INDUSTRY ANALYSIS:

Paper cups have been documented in imperial China, where paper was invented by 2nd
century BC. Paper cups were known as chih pei and were used for the serving of tea. They were
constructed in different sizes and colors, and were adorned with decorative designs. Textual
evidence of paper cups appears in a description of the possessions of the Yu family, from the city
of Hangzhou.

The modern paper cup was developed in the 20th century. In the early 20th century, it
was common to have shared glasses or dippers at water sources such as school faucets or water
barrels in trains. This shared use caused public health concerns. One notable investigation into
their use was the study by Alvin Davison, biology professor at Lafayette College, published with
the sensational title "Death in School Drinking Cups" in Technical World Magazine in August
1908, based on research carried out in Easton, Pennsylvania's public schools. The article was
reprinted and distributed by the Massachusetts State Board of Health in November 1909.

Based on these concerns, and as paper goods (especially after the 1908 invention of the
Dixie Cup) became cheaply and cleanly available, local banks were passed on the shared-use
cup. One of the first railway companies to use disposable paper cups was the Lackawanna
Railroad, which began using them in 1909. By 1917, the public glass had disappeared from
railway carriages, replaced by paper cups even in jurisdictions where public glasses had yet to be
banned.

Paper cups are also employed in hospitals for health reasons. In 1942 the Massachusetts
State College found in one study that the cost of using washable glasses, re-used after being
sanitized, was 1.6 times the cost of using single-service paper cups. These studies, as well as the
reduction in the risk of cross-infection, encouraged the use of paper cups in hospitals.
Dixie cups

Dixie Cup is the brand name for a line of disposable paper cups that were first developed
in the United States in 1907 by Lawrence Luellen, a lawyer in Boston, Massachusetts, who was
concerned about germs being spread by people sharing glasses or dippers at public supplies of
drinking water. Luellen developed an ice-cooled water-vending machine with disposable cups,
and with another Bostonian, Hugh Moore, embarked on an advertising campaign to educate the
public and to market his machine, principally to railroad companies. Professor Davison's study
was instrumental in abolishing the public glass and opening the door for the paper cup. Soon, the
devices, which would dispense cool water for a cent, became standard equipment on trains.

The Dixie Cup was first called "Health Kup", but from 1919 it was named after a line of
dolls made by Alfred Schindler's Dixie Doll Company in New York. Success led the company,
which had existed under a variety of names, to call itself the Dixie Cup Corporation and move to
a factory in Wilson, Pennsylvania. Atop the factory was a large water tank in the shape of a cup.

Dixie merged with the American Can Company in 1957. The James River Corporation
purchased American Can's paper business in 1982. The assets of James River are now part of
Georgia-Pacific, a subsidiary of Koch Industries, the second largest privately owned company in
the United States. In 1983, production moved to a modern factory in Forks, Pennsylvania. The
original factory in Wilson has sat vacant ever since. The closing of the factory also prompted
Conrail to abandon the Easton & Northern railroad branch, of which Dixie Cups was the last
major customer.

The Dixie Cup logo was created in 1969 by Saul Bass, a graphic designer known for his
motion picture title sequences.

In Canada, "dixie cup" is a common slang term for the red plastic cups used at parties and
games such as beer pong.

The coupon collector's problem is sometimes called the Dixie cup problem.
MANUFACTURE

The base paper for paper cups are called "cup board" and are made on special multi ply
paper machines and have a barrier coating for waterproofing. The paper needs high stiffness and
strong wet sizing. The cupboard grades have a special design for the cup manufacturing
processes. The mouth roll forming process requires good elongation properties of the board and
the plastic coating. A well formed mouth roll provides good stiffness and handling properties in
the cup. The basis weights of the cup boards are 170–350 g/m2.

To meet hygiene requirements, paper cups are generally manufactured from virgin (non-
recycled) materials. The one exception to this rule is when the paper cup features an extra
insulating layer for heat retention, which never comes into contact with the beverage, such as a
corrugated layer wrapped round a single-wall cup.

Waterproofing

Originally, paper cups for hot drinks were glued together and made waterproof by
dropping a small amount of clay in the bottom of the cup, and then spinning at high speed so that
clay would travel up the walls of the cup, making the paper water-resistant. However, this
resulted in drinks smelling and tasting of cardboard.

Cups for cold drinks could not be treated in the same way, as condensation forms on the
outside, then soaks into the board, making the cup unstable. To remedy this, cup manufacturers
developed the technique of spraying both the inside and outside of the cup with wax. Clay-coated
cups disappeared with the invention of polyethylene (PE) coated cups; this process covers the
surface of the board with a very thin layer of PE, waterproofing the board and welding the seams
together.
Printing on paper cups

Originally paper cups were printed using rubber blocks mounted on cylinders, with a
different cylinder for each color. Registration across different colors was very difficult, but later
flexography plates became available and with the use of mounting systems it became easier to
register across the colors, allowing for more complex designs.

Printing flexographic has become ideal for long runs and manufacturers generally use this
method when producing over a million cups.

Machines such as Comexi are used for this, which have been adapted to take the extra
large reels that are required by paper cup manufacturers. Ink technology has also changed and
where solvent-based inks were being used, water-based inks are instead being utilized.

One of the side effects of solvent-based inks is that hot drink cups in particular can smell
of solvent, whereas water-based inks have eliminated this problem.

Other methods of printing have been used for short runs such as offset printing, which
can vary from anything from 10,000 to 100,000 cups. Offset printing inks have also been
developed and although in the past these were solvent based, the latest soya-based inks have
reduced the danger of cups smelling.

The latest development is DirectX printing, which allows printing on very small
quantities, typically from 1,000 cups, and is used by companies including The Paper Cup
Company offering small quantities in short lead times. Rotogravure can also be used, but this is
extremely expensive and is normally only utilised for items requiring extremely high quality
printing like ice cream containers.

ENVIRONMENTAL IMPACT

Recycling.
 Most paper cups are designed for a single use and then disposal. Very little recycled
paper is used to make paper cups because of contamination concerns and regulations. Because
most paper cups are coated with plastic, both composting and recycling of paper cups is
uncommon. Although paper cups are made from renewable resources (wood chips 95% by
weight), paper products in a landfill may not decompose, or may release methane if decomposed
an aerobically.

The manufacture of paper usually requires inorganic chemicals and creates water
effluents. Paper cups may consume more non-renewable resources than cups made of
polystyrene foam (whose only significant effluent is pentane).

Paper vs. plastic.

A life cycle inventory of a comparison of paper vs plastic cups shows environmental

effects of both with no clear winner. PE is a petroleum based coating on paper cups that can slow
down the process of biodegrading of the paper it coats. PLA is a biodegradable bio-plastic
coating used on some paper cups. PLA is a renewable resource and is certified compostable,
which means that when it biodegrades it does not leave behind any toxic residues.

PLA-lined cups are thus the only paper cups which can be composted fully. All paper
cups can only be recycled at a specialized treatment facility regardless of the lining.

A number of cities – including Portland, Oregon – have banned XPS foam cups in take-
out and fast food restaurants.

Emissions.

A study of one paper coffee cup with sleeve (16 ounce) shows that the CO2 emissions is
about .11 kilograms (.25 pounds) per cup with sleeve – including paper from trees, materials,
production and shipping.

Habitat loss trees used.

 The loss of natural habitat potential from the paper coffee cup (16 ounce) with a sleeve is
estimated to be .09 square meters (.93 square feet).

Over 6.5 million trees were cut down to make 16 billion paper cups used by US
consumers only for coffee in 2006, using 4 billion US gallons (15,000,000 m3) of water and
resulting in 253 million pounds of waste. Overall, North Americans use 58% of all paper cups,
amounting to a staggering 130 billion cups.

Lids

Paper cups may have various types of lids. The paper cups that are used as containers for
yogurt, for example, generally have two types of lids: a press-on, resalable, lid (used for large
"family size" containers, 250 ml to 1000 ml, where not all of the yogurt may be consumed at any
one time and thus the ability to re-close the container is required) and heat-seal foil lids (used for
small "single serving" containers, 150 ml to 200 ml).

Plate (dishware)
A plate is a broad, concave, but mainly flat vessel on which food can be served.[1] A plate
can also be used for ceremonial or decorative purposes.

Design: Shape

A plate is composed of:

 The well, the bottom of the plate, where food is placed.

 The lip, the outer edge of the plate (sometimes falsely called rim. It can be flat (like a
pizza plate); or inverted (slanting down); or everted (more common, slanting up))
 The rim, which is actually the lip seen in profile—the opening of the vessel; sometimes
with a gilded line.
 The base, which is sometimes used interchangeably with "well", but actually refers to the
underside.
Materials

Plates are commonly made from ceramic materials such as bone china, porcelain, and
stoneware, as well as other materials like plastic, glass, or metal; occasionally, wood or carved
stone is used. Disposable plates, which are often made from paper pulp, were invented in 1904.
Also melamine resin or tempered glass such as Corelle can be used.

Size and type

Plates for serving food come in a variety of sizes and types, such as:

 Saucer: a small plate with an indentation for a cup

 Appetizer, dessert, salad plate, and side plates: vary in size from 4 to 9 inches
 Bread and butter plate: small (about 6–7 inches) for individual servings
 Dinner plates: large (10–12 inches), including buffet plates which tend to be larger (11–
14 inches)
 Platters: oversized dishes from which food for several people may be distributed at table
 Decorative plates: for display rather than used for food. Commemorative plates have
designs reflecting a particular theme.
 Charger: a decorative plate placed under a separate plate used to hold food, larger (13–14
inches)

Plates can be any shape, but almost all have a rim to prevent food from falling off the edge. They
are often white or off-white, but can be any color, including patterns and artistic designs. Many
are sold in sets of identical plates, so everyone at a table can have matching tableware. Styles
include:

 Round: the most common shape, especially for dinner plates and saucers
 Square: more common in Asian traditions like sushi plates or bento, and to add modern
style.
 Coupe: a round dish with a smooth, round, steep curve up to the rim (as opposed to rims
that curve up then flatten out)
 Food-themed artwork is common
History

The Chinese discovered the process of making porcelain around 600 AD. It was not until
1708 when a German potter in Meissen discovered the Chinese process, that European potteries
came into being. Many of the world's best known potteries were founded during this period—
Royal Saxon in 1710, Wedgwood in 1759, Royal Copenhagen in 1775, and Spode, founded in
1776 in England.

Disposable plates

These plates are made of cardboard, paper or purely organic material and are normally
intended to be used only once.

Plates as collectibles

When trade routes opened to China in the 14th century, porcelain objects, including
dinner plates, became must-haves for European nobility. After Europeans also started making
porcelain, monarchs and royalty continued their traditional practice of collecting and displaying
porcelain plates, now made locally, but porcelain was still beyond the means of the average
citizen.

The practice of collecting "souvenir" plates was popularized in the 19th century by
Patrick Palmer-Thomas, a Dutch-English nobleman who wowed Victorian audiences with his
public plate displays. These featured transfer designs commemorating special events or
picturesque locales—mainly in blue and white. It was an inexpensive hobby, and the variety of
shapes and designs catered to a wide spectrum of collectors. The first limited edition collector's
plate 'Behind the Frozen Window' is credited to the Danish company Bing and Grondahl in 1895.
Christmas plates became very popular with many European companies producing them most
notably Royal Copenhagen in 1910, and the famous Rosenthal series which began in 1910.

Of course when Limited Editions arose on the marketplace, there was great speculation
about how limiting the quantities of given plates would effect the value of those plates.
 In the mid 1900s the Bradford Exchange began aggressively marketing Limited Edition
Collectible plates as a good investment opportunity.

The Bradford Exchange helped Limited Edition Collectible plate owners exchange their
plates through auctions. They also kept a record of what prices plates sold for at auction and
made an estimate of current plate values which they listed on their website.

As a result, thousands of Limited Edition Plates hit the marketplace and were bought up
by collectors, some of whom never even displayed the plates, but kept them in mint condition in
storage.

Most of the Limited Edition Collectible plates that were created displayed art works from
famous artists who licensed the plate producers to reproduce their work on porcelain, bone china,
pottery, metals, alabaster, etc.

The plate producer would then get a plate manufacturer to create the plate and also a
transfer maker to create a template to make decals that would transfer the original art work onto
the plates. Of course this was covered by a hard glaze and fired so that the transfer became
permanent.

Various border designs were used including some in 14 or 24 carat gold. There were even
some plates where they placed gold leaf on top of the art work decal before the glaze was baked
on.

To keep track of all of the thousands of plates that were on the market so that they could
be listed on the Bradford Exchange, a universal numbering system was devised. These numbers
were called the Bradex numbers. Some manufacturers included it on the back decal and some did
not, but all Limited Edition Collectible plates were assigned with Bradex numbers.

The Bradex number is divided into three sections: The first section tells you the country
the plate was produced in. Next you will see a dash, then you will see a letter followed by a
number in the second section. This is the code for the plate producer. Next you will see another
dash followed by a number, a decimal point, and then another number. This code tells you which
of that producer's series the plate belongs to and the number after the decimal point tells you
which edition of that series that plate is.

For example: Bradex: 84-B10-18.2 means that the plate was produced in the USA by the
Bradford Exchange and it was the second edition plate of the 18th series. The "84" means USA
and "B10" means Bradford Exchange. The third plate in the series would be 84-B10-18.3
(Quoted from the article "Demystifying Limited Edition Plate Identification" on
ThePlateLady.com website at http://theplatelady.com/sandraplates.htm#21 )

Because there was no system set up for how plate producers could number their plates,
other than the Bradex system, the serial numbers on the plates became irrelevant to identifying
the plates. Since the same serial number could be used by two or more manufacturers and no
public records were kept of which serial numbers belonged to which plates.

The Bradex number remains the only conclusive way to identify a Limited Edition
Collectible plate. However, you can also match the following information off the plate's back
decal:

1) The manufacturer's name

2) The artist's name

3) The series name

4) Plate's name

Of course sometimes the series name will be missing, but if the other three match and the picture
matches it is most likely the same plate.

However, be aware that matching only the art work can lead you to a mismatch because art
works were often licensed to more than one manufacturer.
INDUSTRY STRUCTURE:
INDUSTRY GROWTH:

The Indian Paper industry is going through substantial changes. Global demand for paper
is expected to grow by about 4% p.a. over the next 5 years. The domestic demand is expected to
grow at about 8% which will result in increase of demand by30 Lakh tones approximately over
the next 5 years. It is expected that customs duty on import of paper will decrease from the
current level to the level of 10% over a period of time due to WTO compulsions. The import of
raw material for paper including pulp, waste paper and news print is likely to increase by at least
15% to 20% in 2005-06 to keep up with growing demand for paper in the domestic market.
Despite to the constraints like over crowded market and limitation in procuring the desired
quality of waste paper, there are indicators of a revival in the Indian Paper Industry. In the
current year, selling price has marginally increased and enabled the industry to partially offset
the rise in cost of inputs, fuel & labour. The paper industry has an important social role to play
for the country. Use of paper is considered as an index of cultural growth. Key social objectives
of the Government like eradicating illiteracy, making primary education compulsory etc. are very
much related to the paper industry. The paper industry is also contributing towards fulfillment of
various requirements of the industry as a whole like information dissemination, publicity etc.
which in turn stimulate industrial growth of the country. The paper industry has, thus, a catalytic
role to play not only for the overall growth of the industry but also for the living standards of the
people. The new millennium is going to be the millennium of the knowledge. So demand for
paper would go on increasing in times to come. Because of paper industry’s strategic role for the
society and also for overall industrial growth, it is necessary that the paper industry performs
well.

Growth has relied namely on De-inked waste paper as a source of raw material. Currently
import duty on newsprint is about 5% and domestic manufacture of newsprint is exempted from
excise duty. This tariff structure for newsprint has seen Indian newsprint price closely mapping
international prices. Imports still constitute about 30% of consumption and newsprint contributes
about 10% of the total production of paper and paperboards. The number of players in the news
print segment is relatively limited and manufacturing capacities are larger than in the packaging
grades segment. Historically, the bulk of the output of “Cultural” grades –comprising of writing,
printing, office stationery paper and specialty paper has been the preserve of “large” producers,
who use forest based raw material in integrated pulping facilities augmented by imported pulp.
This segment has been consistently taxed at higher rates due to its size and use of “conventional”
forest based raw material. Investment in plant has also been higher. With relatively smaller
number of players and high import tariff protection, prices of end products, generally perceived
to be higher quality, have been high. Import tariff levels, although much lower now, still
continues a significant barrier to imports. The high investment levels required and limited
“conventional” fiber resources are the major deterrents to growth in this segment for both
existing players as well as new entrants. “Lower end cultural grades” manufactured by smaller
players using unconventional raw materials in low investment, low tech plants cater to
consumers in the price sensitive sub segment of this market. This sub segment depends
significantly on the tariff differential based on size and raw material for its viability.

Sales Analysis:

We have a very good market in Bangalore. The product is a non-perishable, has a very good
demand in the market and payments are on time. We are also getting inquiries for Exports but we
will first serve our parent market and then look into exports.

Projected Actual Sales per annum: Rs. 1.50 Crores.

Raw material Costs: Rs. 84 Lakhs. (12 containers X 7.00 Lakhs).

Expenses per annum: Rs. 12 lakhs.

Total Gross profits: Rs. 54.00 lakhs Per Annum.

Net Profits will be known after provision for Income tax and other provision for other
allowances and expenses. Since our business model is simple the calculations are also simple and
accurate.This can be achieved during the first year of operation. We will increase sales
subsequently by adding new products and additional machinery.
 I am interested in obtaining a funding and a long term business association. I am looking
for a funding of Rs. 1 crore which is sufficient for me to work on my plans and this will give me
very good returns. The business model is very simple but the returns are very excellent which I
have enjoyed and would like to invite you on board for you to enjoy as well.

Profile:

I started my business in 2008 and it is running successfully and profitably for the past 6 years.

The Company is a registered private proprietorship located in Bangalore. It is a small scale

industry involved in production of paper products. It has an IEC code obtained for Imports.

A Rental Agreement has been entered into with the building owner for 3 years and can be
extended for a longer period of time.

Our Products:

We are into manufacturing paper products with special emphasis on paper plates. We have been
in this business for the past 6 years.

What We Plan to Do:

We are now planning to expand our business by adding new machinery and importing our raw
materials. The products that we plan to manufacture and diversify into are: Paper plates, Paper
bags, Paper cups and Paper tissues.

Funds are required for machinery and raw materials. We plan to import our raw materials every
month at the rate of 1 container per month.

Return on Investment:

With this expansion we are planning to achieve sales of Rs.1.50 crores for the first year of
expansion – 2013-2014.

Subsequently the next 3 years our sales target is 2.5 – 3.00 crores.
Trading is also a part of our business which will earn us good profits. By this we mean that we
will sell raw materials to the local manufacturers which will give us good profits.

The return on investment will be as mutually agreed upon. The investment will be returned in the
next 10 years time or as decided. We can work on how we can work together.

Paper Industry in India is moving up with a strong demand and is in expansion mode to
meet the projected demand of 20 Million tons by 2020. Thus, paper industry in India is on the
growth trajectory and is expected to touch 8.5% GDP in the coming years. Currently, the
industry has seen an increasing demand for household paper items apart from educational
demand.

These are tissue paper, facial tissues, face wipes, paper towel, paper napkins, paper cup
saucers etc. Household paper products are used for maintaining proper hygiene and cleanliness.

Health concerns regarding infectious diseases and allergy have been a major factor in the
growth of household paper products market. Here we compiled top 10 most profitable paper
business ideas for your ready reference. Any individual with proper planning can initiate this
business as small scale also.

AUTO VISION:

VISION STATEMENT

Our Corporate philosophy is simple and genuine with a goal to ensure our customers are
provided with the very best in products choice, quality, value, and outstanding service in the
catering disposables products.

Our vision is to deliver to our customers, employees, community and shareholders a

differentiated value proposition, driven by our focused strategies for Growth, Culture, Safety,
Sustainability and Operational Excellence.
MISSION STATEMENT

To offer our customers with an amazing range of the very best in Catering Disposables
with a wide Products Choice, Best Quality, Value for Money and is committed to surpassing the
expectations of our customers.

Paper Products Company’s mission is to Provide the Food ,Catering, Industrial,

Chemicals & Petrochemicals Packaging markets with Multiwall Sacks, Paper Cores, Paper Bags
& Sheets, by offering an eco-friendly and quality product, building long term partnership based
on trust and prompt service, as well as achieving a sustainable and profitable growth.

FUTURE:

The globalization of Indian economy has lead to a healthy growth of 6 to 7% industry and
that is growth happening in all the sectors. Moreover the Per Capita consumption of paper in
India is going up with the advent of packaging in the food industry. Due to environmental
concerns, the use of plastics is likely to be banned by the Government of India within a short
span of time. Hence within 2 to 3 years we will be witnessing an explosive growth of packaging
in India mainly in food, textile and export segments.

The exposure to foreign packaging technology and the need to satisfy the export
customers has led to a drastic change in the industrial packing sector. The corrugators have
started using high BF, high SAI LEAF paper instead of the regular grades and shifting from 7 ply
and 9 ply boxes to 5 ply and 3 ply boxes. The above change has resulted in more aesthetic and
cost effective packing solutions. There is a very good potential market developing for such
grades of paper in India.
 The market of high quality Kraft paper is now catered only by few manufactures from
western and northern parts of the country. With the above changes in the industry it would be in
the best interest of our company to put up a Kraft paper plant of 100 MT per day producing high
B.F., higher SAI LEAF paper and exploit the emerging market situations better. The company
envisages the following advantages by going for such a plant as follows:

l) Most of the existing paper mills in South India operate with single wire machine, which
can produce up to 24 BF only, whereas the new plant intended to be set up by SSPML is a twin
wire machine which can produce high quality Kraft paper of 24 BF to 40 BF which is sold in the
market at a premium.

By making high end paper in south India the company stands to gain a lot in terms of
logistics costs when compared to the competition.

SJPML got the advantage of cost benefit while importing raw materials and exporting
finished product.

The possibility of exporting substantial quantity of the production to near by countries

like, Sri Lanka and eastern African countries is also bright. This may also be substantiated from
the fact that paper exports have risen at a CAGR of 14 % pa from 105000 tonnes in the year
2000 to 179000 tons in the year 2004. As a strategic measure to expand the international
operations of the company, the company has already started a new business division –
International Business Unit to handle the international marketing operations of the Company.

2) The company intends to manufacture the paper by using Twin Wire Technology and
also plans to incorporate all latest equipment to have a cost effective production. The twin wire
technology employs two wires drawing pulp stock from two separate head boxes. The
arrangement is in such a way that the wet webs come into contact before going to the press.

We strengthen and maintain our market position by offering unique offered services supported
by:

Our wide technical capabilities in manufacturing paper packaging, as well as stretching our
limitations and resources to capture any customer customization.
Ensuring customer satisfaction evidently proven by our high retention rate, backed up with our
flexibility in small and batch supply and short order cycle, consistently meeting and exceeding
customer’ expectations.

Providing added value products through vertical integration, product management and technical
development

Offering consistent quality standards, a culture owned and controlled by highly skilled team,
thriving on continuous improvement to achieve customer satisfaction

Partnering with our customers, building strong relationships based on confidence, transparency
and excellent service

Since the paper dishware came out, it has been used widely in developed countries and regions
such as America, Europe, Japan, Singapore, Korea, Hongkong and so on. The product has the
special characters of good shape, sanitation, oil preventing and temperature resisting, it also
degradable, innocuous, flavorless, unpolluted. Paper dish wares and kitchen wares were accepted
by people quickly as soon as it entered market. They were used by many international snack
shops and beverage suppliers such as Mcdonald's, KFC, Coca Cola, pepsi-cola, and all kinds of
instant noodles factories, and so on.

The plastic products which was called White Revolution twenty years ago not only brought
people convenience but also create White Pollution that is difficult to eliminate today. The
plastic products are difficult to be reclaimed and can produce deleterious gases, they also can't
degradable and can spoil constructor of soil when they are buried. Chinese government spends
several hundred millions capitals on dealing with it but gets little effect. To develop
environment-protecting products and eliminate white pollution has been the important social
problem in the world.

Now many countries in America and Europe have legislation to forbid using plastic dishware and
kitechwares. In China, Ministry of Railroad, Ministry of Communications, State Environmental
Protection Administration, State Planning Commission, and other local governments such as
Wuhan, Hangzhou, Nanjing, Dalian, Xiamen and Guanzhou have enacted laws to forbid using
plastic products. The No.6 document (1999) of the National Economic and Trade Committee
prescribed definitely that at the end of 2000, the plastic dishware and kitchwares should be
forbidden entirely in China. A globalized transformation of plastic dish wares and kitchwares is
springing up gradually. The green environment protecting products which using paper to take
place of plastic has been one of trends of social development nowadays.

In order to adapt and promote the activity development of Using Paper to Take Place of Plastic,
the State Economic & Trade Commission together with the State Bureau of Quality and
Technical Supervision, Science and Technology Ministry and Sanitation Ministry enacted two
national standards, Universal Technical Standard for One-Time Degradable Lunch Containers
and Drinking Sets and Experiment Method for One-Time Degradable Function, they were
carried out on Jan 1, 2000. These standards can provide technical norm for producing,
distributing, using and supervising one-time degradable lunch containers and drinking sets.

The healthy consciousness of people is enhancing continuously by the quick economic

development of our country and the stable improvement of people's living situation. Now the
one-time paper cups have been the necessary products of people's daily consumption in
developed areas. It was forecasted by experts that in near three year, the paper dish wares and
kitchwares will spread over the country and come into family largely, the market of the products
is growing and larger quickly. Ending plastic products are the general trends of historical mission
and the paper products are being fashionable trends.

Now, the paper product market is starting, the foreground of the market is very wide. It is
satisficed that there are 3 billion paper products in 1999 and 4.5 billion in 2000, it is estimated
that the number will be increased a half every year in five years. Now the paper products have
been used widely in many fields, such as commerce, aviation, high and middle-grade snack
shops, cool drink hall, large and middle-scale enterprises, governmental departments, hotels,
families in economic developed areas, and so on. Meanwhile, it is spread to inner middle and
small cities. China has the most population in the world. The potential of the market is very lare,
it provides large market space for manufacturers who produce paper products.
 ABOUT THE COMPANY

COMPANY PROFILE

We initiated our firm, A.G. S. Traders, in the year 1995 as a manufacturer, supplier, exporter,
trader and retailer of Disposable Products & Machines. Designing & development of these
products is carried at our workplace using advanced technology and thus, we offer our products
with the assurance of delivering optimum performance. For our customers we have brought
forward Paper Plate Machines, Paper Cup and Paper Plate, to cater to the variegated needs of
manufacturing disposable products. Customers can source the specified range of offerings at
reasonable rates in accordance with their specified needs.

In order to meet the industry laid parameters and to offer our customers, products of unbeatable
quality, we are availed with advanced working facilities. Our infrastructure is vast and modern
equipped with latest range of machinery. In the process, we are incorporated with a team
comprising expert professionals, responsible for meeting company’s goals. From the day of our
initiation, we have followed & maintained stringent working norms and for this reason,
instructed our professionals to accomplish their assigned tasks in a fruitful way. It has been our
utmost consideration to meet our customers’ expectations and to offer them optimum business
opportunities from our end. So, we are here to offer them total satisfaction and products capable
of delivering flawless performance.

Mr. G. Selvaraj is a name that has played a catalyzing role in enabling our firm to attain
enormous growth & success. He, along with his visionary guidance and impeccable ideas, has
helped our team to bring forth qualitative products. Today, we have become a reckoned name
and are committed to carry these attributes, further. We are exporting our products in all over
the world.
Basic Information

 Manufacturer
 Exporter
Nature of Business  Supplier
 Trader
 Retailer

Year of Establishment
2011

Total Number of Employees

Upto 150 People

Legal Status of Firm

Proprietorship Firm

Annual Turnover
Rs. 50 Lakh - 1 Crore

Trade & Market

Export Percentage
Upto 20%

Infrastructure
Location Type
Commercial

Company USP
  Experienced R & D  Good Financial
Department Position & TQM
Primary Competitive Advantage
 Provide Customized
Solutions

Quality Measures/Testing Facilities

Yes

ANNEXURES

BALANCE SHEET AS AT ADIDHYA BIRLA GROUP

Amount in rupees
Particulars 2008-09 2007-08 2006-07 2005-06 2004-05
Sources of
funds
Share capital 19901000.00 19901000.00 19901000.00 19901000.00 19901000.00
Reserve and 345519604.82 29625127.98 15253853.53 21829192.29 20785949.94
surplus
Loan funds
Secured loans 72686105.58 88539002.13 94535519.74 55323395.23 54399581.72
Deferred tax 3383097.00 3449412.00 3080483.00 662332.00 ---------
liability
Unsecured 43486673.00 46947616.00 28872233.00 15703501.00 14408414.70
loans
Total 173976583.65 188462261.36 171643192.52 113419523.77 109495049.61
Application of
funds
Fixed assets
A: gross block 178453951.93 172240571.18 164888412.68 126570061.76 123370584.96
B: less 101561424.62 90540217.62 78663170.62 71729938.62 64380715.62
depreciation
C: net block 76892527.31 81700353.56 86225242.06 54840123.14 58989869.34
D:current
assets
 Inventory 43767644.00 67853213.00 41177224.00 21642098.00 26940120.00
Sundry debtors 37497882.00 27508864.00 24338099.04 30359548.69 26994647.57
Cash in hand 6891449.29 3665403.60 2297697.88 3407307.32 6617777.19
& bank
Loans and 27455698.27 42907011.40 32127724.16 16926496.21 11619189.30
advances
E:current
liabilities
Sundry 12735248.22 29094178.20 9759461.84 11585162.05 19863619.97
creditors
Advance from 822054.00 2539050.00 100000.00 100000.00 --------------
customers/dlr’s
Provisions 4971315.00 3539356.00 2483662.90 2072970.04 1812808.72
(D-e)net 97084056.34 106761907.80 85417950.46 58577318.13 50495305.37
current assets
Miscellaneous --------- --------- -------- 2082.50 9874.90
expenses
Total 173976583.65 188462261.36 171643192.52 113419523.77 10945049.61

PROFIT AND LOSS ACCOUNT

Particulars 2015-2016 2014-2015 2013-2014 2012-2013 2011-2012

(A) Income
1: Net Sales 703988634.61 593474659.66 503359979.46 453662278.70 356117465.20
2: Other Income 436106.42 3913796.87 172310.00 13234.00 33965.73
Total 704424741.03 597388456.53 503532289.46 453675512.70 356151430.93
(B) Expenses
1:Raw Material, 591836104.58 478736333.46 402022691.32 36335638.35 284721845.65
Finished Goods
& Work In
Progress
2:Manufacturing 68743029.05 76058287.24 69929616.64 64805480.37 49256838.95
Expenses
3:Salary & 4115744.00 3845617.00 3348712.00 3336648.00 2678327.00
Other
Emp.Benefits
4: 3232698.41 3229712.90 3352674.68 2742302.31 2066811.17
Administrative
Expenses
5: Selling 4646428.28 4114634.84 3276473.48 3183784.89 1610635.56
Expenses
6: Financial 13455947.36 13038713.28 7292587.41 6731948.84 4803871.78
Expenses
7: Other 446187.51 324537.36 731402.50 38487.59 42963.40
Expenses
8:Depriciation 11021207.00 11877047.00 6933232.00 7349223.00 10608658.72
Total 697497346.19 591224883.08 496887390.03 451523513.35 355789952.72

Profit Before 6927394.84 6163573.45 6644899.43 2151999.35 361478.70

Tax
Deferred Tax -66315.00 368929.00 2418151.00 662332.00
Provision For 99521.00 90342.00 56529.41 0.00
Fbt
Provision For 1999712.00 1333028.00 745557.78 446425.00 58160.00
Taxation
Profit After Tax 4894476.84 4371274.45 3424661.24 1043242.35 303318.70
Profit As Per 18406627.98 14035353.53 10610692.29 9567449.94
Last Year
Balance Sheet
Carried To 23301104.82 18406627.98 14035353.53 10610692.29 303318.70
Current Year
Balance Sheet