Mahindra Home Finance: Mba Department - The Oxford College of Engineering

MAHINDRA HOME FINANCE
INTRODUCTION TO INTERNSHIP
This internshipqprogramqishdesigned for the students to engaged in a field of

experience with an opportunity to share their insights to explore the links between
students’ academic preparation and their field work to assistsparticipantsmin
developing and carrying outxthemamajor research project, which will serves to
culminate their internship experience.
An internship provides more accurate picture of whatcindividualssdo

inzcertainzprofessions under the guidance of experiencedzpractitioners, Internsxapply
the skillscand theories learned in the classroom to real world issues, an internship can
be a paid work experience that alsohhas academic value in one’s program study.
Purpose of Internship: To understand working culture of the Organization and

theoretical concepts in real life situation at the work place for various function
Type of work done in the Organization: -
 Filling the loan agreement forms

 Entering the customers details in organisation data
Duration of Internship: 16th January 2018 to 24th March 2018
Place of Internship: Bangalore

Name of the Organization: Mahindra home finance
MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 1

1.2 INDUSTRY PROFILE:

We are one of the main non-saving money back organizations (NBFCs) customers in
thepcountry andgsemi-urbankterritoriessin IndiaaIt is partuof the MahindrauGroup,
which is one ofothe largest businesspconglomeratestinuIndia. sWe alsoqprovide
housing finance, personalgloans insuranceubroking and mutualtfund
distributionuservices.
It was joined in the year 1991 and started tasks as a back organization in 1993.
Enlisted as a store taking and have since built up in India nearness 24 states and 4
association domains through 607 workplaces it take into account the financing needs
of our vast client base, which incorporates - retail clients, little and medium measured
ventures.
Our companyofocuses primarilyuon providingpfinancing for:

a) Purchasepof newshome
b) Newwauto
c) Utilityyvehicles
d) Tractors,
e) Cars andpbusinessdvehicles.
This represented 27%, 19%, 33% and 11% of evaluated add up to estimation of the
advantages financed separately for the advantage of associations with merchants and
our long standing associations with Mahindra and Mahindra Financial Services
Limited and Maruti Suzuki India Limited, which enables us to give nearby financing
at dealerships.
We have several awards,aincludingzthe IDC EnterprisexInnovationzawards,

2010,
 The CEOzwith HR Orientation Award fromlAsia Best EmployerzBrand
Awards 2010uand the Pioneer Award in the EnterprisepConnectdAward -
2007.
 We ranked 186th in the list of India’s Most valuable Companieszin the

privatexSectorpin termsnof Average MarketmCapitalisation in
2009dPublished By Businessutoday magazine.
We will probably be the favoured supplier of budgetary administrations, across the

ruralzand semi-urban areasqof India. Oursvision is to be the leadingzrural
financexcompany andmcontinue to retainpthe leadershipuposition
foryMahindrarproducts.
Our technique is to give a scope of monetary items and administrations to our clients
through our across the country dissemination arrange. We look to position ourselves
between the composed managing an account division and neighbourhood cash banks,
offering our clients aggressive, adaptable and quick loaning administration
Mahindra and Mahindra Financial Services Limited one of the main non-managing an
account back organizations with the clients inathe provincialzand semi-urbanhmarkets
ofoIndia. They arepa piece ofuthe MahindrayGroup, whichrone of thedbiggest
businesshaggregates inmIndia.
They are basically occupied with giving financing to newzandxpre-claimed auto and
utility administrations,qtractors, autos and business vehicles.zWe additionally give
lodging money, individual advances, financing to little and medium ventures,
protection broking and common store dissemination administrations.
Furthermore, we give discount stock – financingztozmerchants andzretail financinguto

clientspinpthe United Stateskfor buy of MahindramGroup Productsbthrough
MahindranFinance USA, ouryjoint wander with a backup of other gathering.
DIFFERENT TYPES OF NBFCS ARE AS FOLLOWS:

 Asset FinancezCompanyz(AFC)
An AFC is an organizationzwhich is axmonetary foundationzcarrying on as

itsbimportant businessuthe financingpof
physicalmresourcesxsupportingjprofitable/financial, forkexample,lvehicles, tractors,
machinexmachines, cranes, generatorzsets, earthzmoving and materialpdealing
withogear, proceeding onwarduclaim poweryand broadly useful modernrmachines.
Primarywbusiness for thisoreason for existing isucharacterized asttotal of
financinghgenuine/physicalnresources supportingxmonetary movementzand salary

emergingbalong these lines isn'tuunder 60% of itspaggregate resources and

aggregate payzseparately.
 Investment Company (IC)
IC implies any organizationzwhich isxmoneycrelatedbestablishment carryingmon as

itspchief businessuthe procurement ofysecurities
 LoanzCompany (LC)
LC implieszany organization whichxis a money related establishment

carryingzonxas its important business the giving of back whetherzbyomaking credits
or propels or generally forxany movement other thanwitsqown
howeversdoesgexclude an Asset FinancehCompany
 InfrastructurezFinancepCompany (IFC)
Framework back organizations send at least three-fourths of their aggregate

resources in foundation advances. The net claimed reserves are in excess of
300pcroresoand a baseucrediting rating of and thehCapital tomRisk-
WeightedxAssetsbRatio isn15%
 Infrastructure DebtzFund: Non- BankingkFinancialoCompany

(IDF-NBFC)
IDF-NBFCzis an organization enlisted as NBFCzto encourage the stream of
long haul obligation into framework ventures. IDF-NBFCjraises assets
through Multiple-Currency obligations of least 5-year development.
JustlInfrastructurekFinancebCompanies (IFC) can supportpIDF-BFCs
 NBFC-Factorsz
NBFC Factorszhas standard businessxof figuring. Considering ispa
monetary exchange andoa sort of borrower back
 GoldpLoansNBFCs inzIndia
Throughout thesyears, gold creditzNBFCs saw an upsurge in Indian money
related market, owing for the most part to the current time of thankfulness in
gold cost and resulting increment in the interest for gold advance by all areas

of society, particularly poor people and working class to bring home the
bacon. Inxspite of the fact that there are numerouskNBFCs offering gold
credits in India, around 95 for every penny of thezgold advance businessxis
taken care of by threepKerala based organizations, viz., MuthootuFinance,
ManapuramuFinance and MuthootkFincorp.
 ResiduaryrNon-BankingeCompaniesu(RNBCs)
Residuary Non-BankingzCompanydis a classuofpNBFC which is an
organization and has as its essential business the getting of stores,
undersany plan or course of action or in some other way and
notzbeingzInvestment, AssetpFinancing, LoanmCompany. These
organizations are required to keep up speculations according to headings of
RBI, notwithstanding fluid resources
DIFFERENCEpBETWEENoNBFCS &cBANKS
NBFCspperform capacities like thatmofxbanks yet there areua couple of

distinction gives Banking administrations to People without holding a Bank
permit,
1. AnzNBFCxcannot acknowledge Demand Deposits.

2. An NBFCqis not a piece of the instalmentpand settlement framework
anduthusly,
3. AnzNBFC can't issuepChecks.
4. Deposit protection office of thepDeposit Insurance and
CreditoGuarantee Corporation isn't accessible foruNBFC
contributors,ynot at all likerbanks,
5. AnqNBFC isn'twrequired toykeep up ReservemRatios (CRR, SLR
and so on.)
6. AnaNBFCxca exclude Primarily in Agricultural,pIndustrial Activity,
Sale-Purchase, and Construction of ImmovableuProperty
7. Foreign Investmentxpermitted up to 100%.

FUNCTIONS OF NBFC:
a) NBFCS can't acknowledge request stores, that is regularly subsidizes

saved through a safe foundation which are payable voluntarily, incline
toward yourmcurrent or bankpaccounts.
b) Deposit protectionaoffice ofpDICGCa(Deposit Insurance and Credit

Guarantee Corporation) NS0-163zis difficult to reach forxNBFC
contributors, which isn't with respect to a bank.
c) It is required underzSectionx45-IA RBI, 1934 eachpNBFC to sign up

considering thejRBI considering that it manages the working and
tasks ofcNBFC around the system inside the RBIxAct, 1934
notzwithstanding the headings issued under thislAct. An expert that
registers, for example, akNBFC inside RBIpshould have
unquestionably the base net possessed reserve of ₹ 2ocrore
d) Enlisting considering the RBI requires the accommodation related

with the application utilizing the organization while in the endorsed
design by utilizing fundamental obligatory records. Whenever and if
your financier is content you're the climate is satisfied, it issues an
'Authentication of Registration' at the organization. Once a NBFC
holds a legitimate 'Declaration of Registration', may hold open stores.
NS0-154 However, the NBFCs that acknowledge open stores ought to
as per the Non-Banking FinancialpCompanies Acceptanceuof
PublicyDepositssDirections, 1998, as fromzyourxfinancier.
CRITIRIA FOR SELECTING NBFCS FUNCTIONS:
a) Equipment renting organizations

b) Hire-buy organizations
c) Loan organizations
d) Investment organizations

e) Rules and directions are a piece of each firm and arrangement.

Choosing one. Vital that you see the miniscule print from record work
assertions it. NBFCs get their own particular assortment controls. In
this article controls are accepted critical the investors in the time
venture.
f) NBFCs are allowed to acknowledge or restore open stores to get a
base sum 52 weeks and additionally a most extreme measure of 60
months. They can't acknowledge stores repayable right now.
g) NBFCs will not be permitted to offer endowments/motivations an
extra advantage into your investors.
h) Deposits with NBFCs are certainly not safeguarded.
i) The reimbursement of stores by NBFCs shouldn't be ensured with the
RBI
1.3 COMPANY PROFILE:
Mahindra and Mahindra Financial Services Limited was initiated on 2n October, 1945
by the Mahindra brothers ahead with renewed gentlemen called Ghulam Mohammad.
Both Mahindra and Mohammad were to set up an authority towards launching jeeps
from Willys, USA. After two years,India got freedom and wound up autonomous
nation after that Mahindra and Mohammad Switched its name to Mahindra and
Mahindra. Post the segment Ghulam Mohammed went to Pakistan and turn into the
primary fund serve. After that it has grown rapidly in all the sectors like size and
structure evolved into group it occupies the premier position in all the key sectors of
the economy. The Mahindra group, US$ 6.9 billion conglomerate the significant
presence of Mahindra group in various sectors.
It is one of the consistent high performed and most reputed in the country, presence
various business sectors in the Indian overseas market .the company over 72 years of
manufacturing experience, those aggregation is fabricated a compact build in the
marketing, distribution, engineering and technology which is important in change as a
customer –centric organisation.
Mahindra Rural Housing Finance Limited (MRHFL), a backup of Mahindra and
Mahindra Financial Services Limited (MMFSL), has been built up to give Home

Loans basically in rustic regions and semi urban India. Accordingly it has been
registered with the National Housing Bank (NHB) as a Housing Finance Institution
(Non Public Deposit Taking / Accepting), since 2007.
MMFSL holds 87.5% of the value of MRHFL and the National Housing Bank (NHB)
holds the staying 12.5%.The loans given by the company are secured by mortgage of
the property of the company for home construction, purchase, extension and
improvement. MahindrazRuralxHousinghFinance was consolidated onxApril 9,
2007pand got a testament of enrolment to begin the matter of a
HousingmFinancenInstitution frombthe NationalcHousingvBank onxAugustz13,
2007.
MRHFLzcurrently works in different areas all throughzthe nation which incorporate

Gujarat,kMaharashtra, MadhyavPradesh, Rajasthan, Andhra Pradesh, Telangana State,
Karnataka, Tamil Nadu, Kerala, Bihar and Uttar Pradesh. We give financially survey
and adaptable home advances toxabwide base of clients in country andusemi-urban
India
We ensure that our clients' fundamental need of sanctuary is met conveniently. We

attempt to satisfy our trademark 'GharsKi BaatzHai' by being very client driven while
thinking about the clients as a piece of our more distant family. We take pride in the
way that we have possessed the capacity to help upgradation of many 'Kuccha'uand
decrepit structures made of mud to 'Pukka' houses made of blocks and mortar. We
have likewise given subsidizing to various rehabilitative endeavours
likezchangingbthe ground surface of houses from unpleasant concrete basepto tiles,
and so on that have enhanced livingpconditions in numerous parts ofpRuraluIndia.
Between March 31, 2015 and March 31, 2016, we have increased our office network
by 16.91% to 325 offices and increased the number of financing contracts we entered
into with customers by 47.54% to388154 financing contracts.
For the period finished March 31, 2016 and the year finished March 31, 2015, add up
to pay from tasks was Rs. 4,954 million and Rs. 3284 million, separately and add up
to benefit after tax assessment was Rs. 627 million and Rs. 442 million, individually.

As ofzMarch 31,x2016, we kept up a non-performing resource ("NPA") scope

proportion of 40.62%, Net NPA of 5.55% of aggregate resources, capital ampleness
proportion of 23.65%, add up to credits and advances extraordinary of Rs. 32,736
million and aggregate resources of Rs. 33,012 million, contrasted with, as of March
31,x2015, azNPA scope proportion of 37.37%, net NPA of 4.58% of aggregate
resources, capital sufficiency proportion of 15.27%, add up to advances and advances
remarkable of Rs. 21,017 million and aggregate resources of Rs. 21,194 million
35000
30000
25000
20000
2016
15000 2017
10000
5000
0
Profit after taxation Loans and advances Total assets

2017
40.00%
35.00%
30.00%
25.00%
20.00%
2017
15.00%
10.00%
5.00%
0.00%
Coverage ratio NPA Capital adequacy ratio
The company offers various investment suggestions to customers like:

Fixed deposit
Mutual fund and
Bond
Its subsidiaries are:
Mahindra rural housing finance limited,
Mahindra insurance brokers limited,
Mahindra trustee company private limited, and
Mahindra asset Management Company limited.

1.4 PROMOTERS
Mr. Ramesh Iyerz
Mr. K.zChandrasekhar:

Mr Ravi Directorz
Mr. K. Chakravarty

1.
zMr. Anuj Mehra
Mr. Nityanath Ghanekar

Ms. Anjali Raina
Mr. M. Narendra

1.5 VISION, MISSION &QUALITY POLICY:
VISION:
To be a main monetary administrations supplier in rustic India, Mahindra home back

tries to be the Rural India as far as Profitability, development, worker commitment,
trust and mindfulness that HDFC has increased throughout the years . As Mahindra
home back has demonstrated starting achievement in this market and has seen steady
development and benefits, the organization has established the frameworks for being
the HDFC of Rural India. To be the biggest home credit supplier in the nation
Mahindra home back should pick up no less than one Million new Customers amid the
year.
MISSION:
To change country lives and drive positive change in the groups.
QUALITY POLICY:
Quality of key delivering value and providing money to the customers, value in work,
products. Interaction between others, doing first at right time.
1.6 PRODUCTS / SERVICES:
HOUSING FINANCE
Funds, country andosemi-urbanppopulation to assemble self-managing

houses, pukkazhouses and guarantee their elevate implied in the public eye.
In FYm2012-13, Mahindra RuralxHousing Finance Limited
(MRHFL)zdispensed credits amassing to Rs.l432.9 Crores, up from Rs. 266.8
Crores in the earlier year. The benefit after assessment for 2012-13kremained
at Rs. 222.3Crores, against Rs. 11.9 Croreszin the earlier year. The
exceptional advance portfolio, aszonk31 March 2013, remained atzRs.
879.5xCrore

VEHICLE FINANCING
Vehicle Financing gives a utility administration as Construction of pre -

possessed hardware for credits as multi – utility vehicles, autos, tractors and
Commercial vehicle.
INSURANCE BROKING
Giving Insurance answers for retail clients and additionally companies

through our auxiliary Company
MUTUAL FUND DISTRIBUTION
Prompts customers on contributing cash through AMFI guaranteed experts

under the brand organization
FIXED DEPOSITS
The sign of abnormal state of well-being and Security.
MAHINDRAqMUTUALxFUND
Mahindra AssetxManagementzCompanypPrivatepLimited is an entirely

possessed backuppof MahindrauandxMahindrahFinancial ServicesxLimited
(MMFSL). MahindramAMC Pvt Ltd is the InvestmentkManager for
MahindrakMutual Fund.
It began its task in the primarynseven day stretchoof Julym2016, with

anxAUM ofj1200bMillion INR and its NAVhis gliding around 1000uINR
Mahindra Mutual Fund attempts to offer a different assortment of common
reservekconspires in India, withkuncommon focus in rustic and semi-urban
region
MAHINDRAoINSURANCE BROKERSpLIMITED
In FYz2012-13, the protectionlbroking auxiliary,p(MIBL) crossed

thek8,00,000 check as far as the strategieslserved. ThekCompany's
aggregatexstrategies, toward the finish ofz2012-13, developed at 8,
39,408zfor both lifemand non-life retailxbusiness lines. Ituachieved
anpaggregate of Rs. 600zCrores netqpremium.

 Incomezhas expanded byx85 for every penny fromxRs.

46.6zCrores in 2011-12 toz Rs. 86.3 Croresxinz2012-13.
 Duringxthezyear,sMIBLpwent into a vitalmorganization
withcLeap frog Investments, world'sxbiggestkfinancial
specialistsin protectionpfor theuunderserved.
 Through its backupdorganization,bInclusionsResourcesmPrivate
Limited, Leapfrog contributed Rs. 80.4xCrores for ak15 for every
pennylshareholding inxInsurance businessuconstrained.
MAHINDRApBUSINESSvANDpCONSULTINGzSERVICES
PRIVATEpLIMITED
MahindrasFinance's completelyupossessed auxiliary, MahindrapBusiness and

ConsultingxServices Private Limited (MBCSPL),xgives staffing
administrationscprincipally to MahindramFinance. It additionally serves the
auxiliariesq(MIBL and MRHFL)aand parent organizationz(Mahindra and Mahindra
Limited) amid the year, MBCSPL deputed 8,098xrepresentatives to
theseporganizations. The Profitiafter Tax expanded frompRs. 7.1 Lacs inx2011-12
touRs. 173.8 Lacssin 2012-13.
1.7 INFRASTRUCTURE FACILITIES
Mahindra finance has all these departments at all the following centres the
departments are as follows
 MahindrazRural Housing Finance

 MahindraxInsurance Brokers Limited,
 MahindraaAsset Management Company
 Mutual Fund Distribution and
 Fixed Deposit etc.

Mahindra home finance has 22 branches in Karnataka
1. Aurad
2. Bellary
3. Bidar
4. Bijapur
5. Channagiri
6. Chikmanglur
7. Davanegere,
8. Gulbarga,
9. Gundlupet
10. HagriBommanhalli
11. Honalli
12. Hubli
13. Jewargi,
14. Kembhavi
15. Koppal
16. Manvi
17. Mysore,
18. Raichur
19. Shahpur
20. Shimoga,
21. Sindanur and
22. Yadgir.

1.8 COMPETATIORS INFORMATION

1.9 SWOT ANALYSIS:
STRENGTHS
a) Mahindra Finance has favourable position of brand name of Mahindra and

Mahindra Group
b) It has vast resource base of Rs.5000 crores, huge dispersion channels with
braches everywhere throughout the country.
c) Company has vast monetary base as its IPO ( Initial Public offer)
WEAKNESSES
a) It gives warning administration and they don't have share broking office which
their rivals have.
b) Mahindra fund isn't known to everybody.
c) Does not make promotion of its item

OPPORTUNITIES
a) It has gone into common reserve circulation which is developing according to

Indian market improvement.
b) Mahindra Finance helps people in making monetary arranging which is most
beneficial in as venture incline is charging in India
THREATS
a) The most imperative danger for Mahindra Finance in the market is new
passage of remote non - saving money budgetary foundation
b) In instance of vehicle financing organization has intense rivalry from huge
banks like SBI, ICICI, and HDFC and so forth.
1.10 FUTURE GROWTH AND PROSPECTS:
Mahindra Home Finance has the right kind of monetary strength have been constantly
pretended that possible to change the country lives and we continue in staying place
property into the limit of volume held in the nation India. Mahindra Finance involves
better occupations in the given income into new sorts of the work. The improvement
story of the finance since its source has a part of the common place.
The advancement story behind the India's cash gone the traverse of the most recent
decagon has made much on its provincial side as it is on the urban areas. All in all,
Indian's country heart land and its flooding urban gatherings, India as each one of the
stores of being prepare for a basically more indispensable time of budgetary
promotion.
In the previous decade, in the legislature body has experimented up its usual spending,
annoying having more than one and less than three digit preferment in per capita wage
in natural India. In the establishment of the country we feel that the more sharpened
focus in it, by the setting up expansion of provincial zones and cutting edge sections
as normal expense for the fundamental things in metros reinforcement would
annoying more critical change of India’s towns.

For the change in India for the potential impelled Rs 98,000 core for the smart city and
AMRUT exercises are an objective is arranged. In the urban and the common ranges
the government has planned to develop 60 million houses and offer cabin to all by the
year 2022. This will be altogether control the preferment and area portions.
With the preferment of lanes and the vehicle arrangements will rise. In that manner, it
wills helpful growing road thickness the penetration of the cars and it will increase in
business vehicles.
In the development of hotel and auto demand in that is medium term of these variables
reinforce in one point of view. Every concentrated in giving the guaranteed in
financing courses of action, we hope to upgrade financial prosperity and higher benefit
to drive our nation

1.11FINANCIAL STATEMENT:
Statement ofqProfit And Loss Account for the Year Ended March 31st, 2017
PARTICULARS AMOUNT
in lakhs
Revenue from operations 70,333.57
Other income 3.32
Totalrevenue 70,336.89
Expenses:
Employee benefit expenses 12,847.83

Finance cost 29,794.38
Depreciation and amortisation expense 528.04
Provisions & write offs 7,125.55
Other expenses 7,350.83
Total expenses 57,646.63
Profit before tax 12,690.26

Tax expenses
Current tax 5260.00
Deferred tax (824.50)
Excess or short provision for income tax (45.79)
4,389.71
Profit/ (loss) for the period 8300.55

Balance sheet as on 31st march 2017
PARTICULARS AMOUNT
in lakhs
EQUITY & LIABLITIES
1) Shareholders fund
Share capital 9,513.22
Reserves and surplus 38,074.99
47,588.21
2) Non-Current liablities
Long term borrowings 244,049.75
Long term provisons 6,279.52
250,329.27
3) Current liablities
Short term borrowings 62,729.30
Trade payables
a. Micro & Small Enterprises -
b. Other Micro and Small Enterprises 3400.50
Other current liablities 118,745.55
Short term provisions 8,695.82
193,571.17
TOTAL 491,488.65
ASSETS
1) Non – Current Assets
Fixed assets
a. Tangible Assets 1,526.36
b. Intangible assets 32.53
c. Capital work –in –progress 6.58
Deferred Tax Assets 1,408.39
Long term Loans And Advances 364,996.50
367,970.36
2) Current assets
Cash and cash Equivalents 1,622.45
Short term loans and advances 121,895.84
TOTAL 491.488.65

Statement ofuProfit And Loss Account for the Year Ended March 31st, 2016
PARTICULARS AMOUNT
in lakhs
Other income 7.83
Expenses:

Finance cost 21.332.05
Provisions & write offs 3,873.47
Other expenses 5,107.92
Total expenses 39,875.09
Profit before tax 9,669.64

Tax expenses
Current tax 3,818.00
Excess or short provision for income tax 71.90
Profit/ (loss) for the period 3,401.61

PARTICULARS AMOUNT
in lakhs
EQUITY & LIABLITIES
27,576.70
207,597.70
Trade payables
c. Micro & Small Enterprises -
d. Other Micro and Small Enterprises 2012.11
Other current liablities 51,086.63
94,949.57
TOTAL 330,123.97
ASSETS
Fixed assets
d. Tangible Assets 1,046.06
e. Intangible assets -
f. Capital work –in –progress -
Deferred Tax Assets 583.89
249,345.75
2) Current assets
Cash and cash Equivalents 1,127.21
80,778.22
TOTAL 330,123.97

Statement of ProfithAnd Loss Account for the Year Ended March 31st, 2015
PARTICULARS AMOUNT
in lakhs
Other income 14.03
Expenses:

Finance cost 14112.07
Provisions & write offs 1829.51
Other expenses 3367.15
Total expenses 26112.67
Profit before tax 6731.80

Tax expenses
Current tax 2394.00
Excess or short provision for income tax 58.72
2314.46
Profit/ (loss) for the period 4417.34

PARTICULARS AMOUNT
in lakhs
EQUITY & LIABLITIES
17,315.85
151,640.30
Trade payables
a) Micro & Small Enterprises -
b) Other Micro and Small Enterprises 2,050.32
Other current liablities 32997.27
42,986.25
TOTAL 211,942.40
ASSETS
Fixed assets
a) Tangible Assets 690.87
Deferred Tax Assets 95.60
159.004.04
b) Current assets
Cash and cash Equivalents 990.24
52.938.36
TOTAL 211,942.40

2.1 THEORETICAL BACKGROUND OF THE STUDY:
MEANING OF LOAN:-
In Finance, a loan is the lending of money from one individual, organization

or other individual at interest rate.
HOME / HOUSING LOAN
Money borrowed from financial institution to purchase a Home
THE RATE OF INTEREST ON HOME LOAN
Usually in Mahindra finance they will follow flat rate system for calculation of loan
amount and interest,Up toz75%zof Cost ofsConstructionpbarring expense ofkland.
MAHINDRA HOME FINANCE PROVIDES LOAN
Development of DwellingqUnits
MahindraqHomepFinance conveys to you the delight of self-building the place

you had always wanted on a plot of land you possess.
Buy of DwellingaUnits
Benefit our administrations for obtaining prepared or under development house

or level.

Change/RenovationzofkExisting stayingpUnits
Redesign your home only the way you need and let us deal with the funds for
you.
Augmentation ofuexistingpstayinguunits
Manufacture a room, conceal an open space or include another floor for your
solace with our Home expansion advances.
Joint Liability gather advance
JLGaadvances for gathering of least 3 individuals and most extreme 5

individuals.
Qualification criteria
Mahindra home fund will consider the candidate/co-candidate's salary, age,

business dependability, normality and consistency of wage, reserve funds,
family foundation, resources and liabilities, other than different factors prone to
influence the credit reimbursement to decide the advance qualification.
Agriculturist,aSelf Employed,aBusinessxOwner, Asset Hiring Class, Salaried

Individuals can apply for home fund.
DOCUMENTATION FOR HOUSING LOAN
1. Duly FilledsApplication Form
2. LatestzPassportxSize Photo
3. Agelproof
4. KYChDocuments
5. IncomerProof
6. PropertyzRelated Documents

CUSTOMER SERVICES
a) Visiting Hours of the Office: Mon-Sat: 10.00 a.m. to 6.00 p.m. shut on Public
Holiday and Sunday
b) Details of the Person to be reached for Customer Service: Team Leader or Credit
Officer of the branch.
c) Procedure to get the accompanying including course of events along these lines:
d) Loan Account Statement: 3 working days from date of use which the client needs to
submit to the branch office.
e) Photocopy of title records: 15 working days from date of demand by method for
application routed to the Branch Manager alongside instalment of expenses.
f) Return of Original Documents on conclusion/exchange of the advance: In 21

working days from issuance of NOC. Arrival of Mortgage in 60 days from the date of
issuance of NOC

PROCEDURE OF HOME LOAN
Fill The
Loan Process of Legal
Applicatio offer Letter Check
n form
Processing Loan Site

Fee Approval Estimation
Discussio Verifying Deal,

n with The Agreement
finance Documents , Disbursal
INSTALMENT PROCESS
Based on your profile, occupation qualification and different standards, credit

can be reimbursed in month to month, quarterly or half yearly likened portions
by method for Equated Monthly Instalments/Equated Quarterly
Instalments/Equated Half Yearly Instalments, including central and intrigue.
 Prezportionpintrigue would be payablekamid the periodmafter youdtake

your first payment andwbefore initiation of yoursEquated Instalment.
PredEMI intriguenwould be charged at a similar rate at whichzEMI is
ascertained and would be payablepconsistently on the measure of
advancehdispensed.
 Repayment begins from the month following the month in which last
dispensing of the credit is profited.

 Amount, Number of portions and due date will be indicated in the

Sanction letter and Loan Agreement.
 Repayment of the credit can be made by ACH or money/check/request
draft at any of home fund workplaces. Home back at its sole tact
stipulates on a case to case premise that reimbursement will be
acknowledged through checks/ACH
 It additionally acknowledges post - dated checks for reimbursement.
LOAN DISBURSEMENT PROCESS:
1) Home fund should give a duplicate of the credit understanding alongside

a duplicate every one of all fenced in areas cited in the advance consent
to each borrower at the season of authorize/dispensing of advances
despite the fact that it isn't asked for by the borrower. Home back for the
most part acknowledges outside underwriters for its credits. The surety
shape which is gathered from the underwriters unequivocally specifies
the rights accessible to home fund and the risk of the underwriters
towards home back because of the certification being given
2) On ask for from Applicant home back gives the motivation to dismissal
of its advance. Home back undertakings to process the advance
application and give an on a fundamental level endorse to the client
inside a sensible time span. Anyway this relies upon the finish and
credibility of the archives gave by the client. Further, payment of the
credit is made in stages relying upon the phase of development subject to
all archives identifying with the possession and home loan of the
property being satisfied.
3) It might give to its clients, a rundown of archives required to process
his/her credit application, alongside the phase amid which the said record
would be required to be submitted.
4) All the terms and conditions relating to the credit authorize will be
contained in the endorse letter which is given to the client on endorse of
his/her advance.
5) On the off chance that such change in the terms and conditions is to the
impediment of the client, at that point client would be permitted inside 60 days

and without notice Home back might pull out to the borrower of any
adjustment in the terms and conditions including payment plan, financing
costs, benefit charges, prepayment charges, and other material.
6) Expense/charges and so forth it likewise guarantee that adjustments in loan
fees and charges are influenced just tentatively and appropriate condition in
such manner will be fused in the advance assertion. to close his/her record or
switch it without paying any additional charges or intrigue
7) The reports relating to the property might be discharged by home fund inside a
sensible period from the conclusion of the record and acknowledgment of all
receipts from the client gave no other charge a home loan on lien exists on the
said property of home back Decision to review/quicken instalment or
execution
COMMUNICATION WITH CUSTOMERS

1) Home back should get ready pamphlets, leaflets, structures and all other
writing in either English or the neighbourhood dialect.
2) Customers are educated of all money related data, for example, rates, charges,
technique for computation and so on unmistakably through pamphlets, blurbs
and so on. Preceding going into any exchange.
3) It might keep its clients educated of any adjustment in financing
costs/charges/development of stores or credits and so forth through update
letters or some other type of correspondence/show occasionally.
4) This can be straightforwardly unveil to the borrower all data about
expenses/charges payable for preparing the credit application, the measure of
charges refundable if advance sum in not endorsed/dispensed, pre-instalment
choices and charges, assuming any, punishment for postponed reimbursement
assuming any, transformation charges for changing advance from settled to
coasting rates or the other way around, presence of any intrigue re-set proviso
and some other issue which influences the enthusiasm of the borrower.
MRHFL should reveal 'all in cost'

THE FLAT RATE SYSTEM
Group loan: 18%
Individual loan: 21% for 5 years
Individual loan for 7 years 21.75
CUTTING CHARGES OF LOAN:-
1. Processing charges on loan amount is fixed at 3.5%, if a customer is not

able to pay processing charges then he has to pay at 1% rate at the
beginning, and remaining 2.5% will be deducted in loan amount.
2. Insurance Brokerage charges- 300/-
3. Document charges-500/-
4. Fire charges –according to property value Sampoorna suraksha premium
fire chart, it will be provided by Mahindra home finance.
5. Life insurance- who will be an earning person or key person, the charges
will be claim on age of a person and loan amount as per concern with the
help of table, provided by HDFC Bank.
CALCULATION OF LOAN AMOUNT:-
Example:-
Out flow: 2, 00,000
Flat rate: 13.27
IRR : 21.00
For 100000, IRR- 16626

16626
∗ 2,00,000.
100000
= 33252 (Monthly principal + interest).
21
= 200000 ∗ 100.
= 42000(1 years interest).

42000
= = 3500 (per month).
12
=3500*6 = 21000.
Therefore, 33252-21000=12252

2.2 LITERATURE REVIEW

1. Berstain David (2009), Engage,vol.10,No.1,pp 2009 , George Mason law
and Economics research paper No.09-18 inspected in his examination
from 2001, in this period there is increse of home advances when contrasted
with private mortagage protection he separated his investigation in to 4 areas,
 Why individuals are going for home advances than private mortagage
protection
 Growth and shifting towards home equity market
 Measure changes in types of loans
 Financial status of single and multiple lien
2. Vandel kerry D (2008), Major Coleman 4, Michael Lacour-Little the
analysis the sharp increse and suddenly decerease in home price the period
1998-2008 changes in prices are for the reasons as such economic
fundamental, the problem was not in excess supply of credit in aggregate, or
the increase in sub prime per security, but rather in the increased or decereased
of mortagage products.
3. Simpson (1998), Fox Network in United States between august 23, 1998
and may 16 1999. has studied that the relationships between international
banking risk a Bank performance indicator with reference to liquidity,
profitability and capitalisation of the firm
4. Krainer (2001), Journal of Urban Economics, 2001 Vol. 49, issue 1. Has
presented a theoretical analysis of the portfolio and financing adjustments of
U.S. banks over the business cycle. The model predicts that the advance part of
a bank's portfolio is emphatically identified with changes in bank stock costs,
while the value use proportion differs straightforwardly with the bank's credit
to resource proportion.
5. Dionne, et al (2002) has emphasized on securitization as important tool of
modern finance. This study examines the link between securitization and risk-
based capital ratios. The results showed that any increase in securitization
activities causes decline in both Tier 1 and Total risk-based capital ratios

6. Mihir (2004), emphasised thatAsset-Liability Management is concerned with

strategic application and arrangement of funds so as to attain a predetermined
acceptable risk/reward ratio
7. Vensel (2004), has state that the banks’ performance monitoring, analysis and
control needs special efforts in respect to their operation and performance
results from investors / owners, regulators,customers/clients, and management
themselves. In this study, financial ratio analyses were used for measuring
bank performance with special reference to DuPont analysis and Novel Matrix
approach.
8. Shamsuddoha (2005) has done comparative analysis between local and
foreign commercial banks. The study revealed those consumer credit schemes
are popular among the customers of low-income and medium income levels.
9. The study conducted by Ijaiya & Abudulraheen (2000), International
journal of research in business studies and management Vol. 2, Issue no.3
on the relationship between bank credits and agricultural outputs in Pakistan, it
was revealed that there existed a significant relationship between bank credit in
Pakistan and the agricultural outputs.
10. Dr Jatinder Kaur Raveled that Continuous rise in the factor of money lenders
is that banks will not sanction loans for consumption purpose it for repayment
of previous loans for further assitance to the extent of rural areas
11. According to V.A Avadhani has said that gold, silver, real estate and other
investments for average house holders of middle and lower icome groups.
Invest ments are popular in semi urban and rural areas with various deposits of
non banking finance companies, investment finance companies, housing
finance Companies. And the deposits with these companies
12. F.J.A Bouman discussed about financial intermidiatory as formal and
informal financial sectors and rural finance. Those can play a vital role as
growth of economic development of short term loans and effecitve recovery of
loan

3.1 STATEMENT OF THE PROBLEM:
TOPIC CHOOSEN FOR STUDY AND INTRODUCTION ON
“ EFFECT OF FREE CASH FLOW ON PROFITABLITY FIRM” AT MAHINDRA

HOME FINANCE OR MAHINDRA RURAL HOUSING FINANCE.”
INTRODUCTION:
For fund proprietors and supervisors, Cash stream issues are regularly as perturbing as
income and benefit issues. Income is produced when your business offers merchandise
or administrations for money or gathers installments on accounts from clients.
Moderate or decreasing income can have a few significant consequences for our
business.
Incomings and outgoings of cash, representing the operating activities of an

organization. In accounting, cash flow is` the difference in amount of cash available at
the beginning of a period opening balance and the amount at the end of that period
closing balance.
Cash flow means is much money the business generates before repaying debt and It
differs from net income in that it eliminates non-cash items such as depreciation &
amortization, and other add-backs like owners salary and interest expenses
DIFFERENCE BETWEEN CASH FLOW AND PROFITABILITY:
Money is the difference between the measure of cash an association gets and pays,
while profitability is the refinement among livelihoods and expenses. Associations
expound on both their cash belonging and advantage. Productivity is an accounting
thought and isn't assessed the extent that cash got or paid.
DIFFERENCE BETWEEN CASH FLOW AND FREE CASH FLOW:
Cash flow refers to a stream of revenue or expense that alters a cash account over a
specified time frame. Free cash flow FCF is a measure of a business's financial
performance. It is calculated as the difference between cash flow and capital
expenditures.

3.2 NEED FOR THE STUDY:
1. Effective and efficient cash planning is very useful business concern where cash is
the main basis of all business transactions.
2. It helps to evaluate the current cash position
3 it helps in taking loans from banks and other financial institutions
4. It helps the management in taking short term financial decisions
3.3 OBJECTIVES OF THE STUDY:
1. To Understand the Free Cash Flow System
2. To calculate the Current Free Cash Flow Position
3. To analyse the effect of free cash flows on financial position of the company
3.4 SCOPE OF THE STUDY:
1. It is azfinancial statemenththat presents informationkabout the company’s.

2. Cashpflow shows threepcategories in the statemenththose are:
 Cash flowsfrompoperating activities
 Cashmflow fromcinvestingqactivities
 Cash flow from financingdactivities
3. Operating activitieszare Revenuesproducinglactivities of theucompany.
4. Investinguactivity is themacquisition and disposalzof long term assets
andyother investments, and it will not includeucash equivalents
3.5 RESEARCH METHODOLOGY:
The method of research adapted for the study is Secondary data analysis.
Data collection
 Primary data not used as this study is secondary data analysis.
 Source of Secondary data is company data such as Balancezsheet, profitpand
loss accounttand Cash flow management.

Plan of Analysis
The secondary data was analysed for the study using
1. Net profit figures were calculated using the balance sheet
2. Cash management ratio was calculated to analysis the cash ratio of the company
this was done using following ratios
i. Current ratio
ii. Absolute liquid ratio
iii. Proprietary ratio
iv. Operating cash flow ratio
v. Asset efficiency ratio
vi. Current liablity coverage ratio
3. Calculation of free cash flow was done using operating activities in
cash flow statement and fixed assets in the balance sheet.
The Research Statement of the Study

Hypothesis was tested using
 Spearmen’s Rank co-relation
 Co-efficient of correlation
3.6 HYPOTHESES:
H0: There is no significant effect of free cash flows on financial position of the
company
H1: There is significant effect of free cash flows on financial position of the company
3.7 LIMITATIONS:
1. A cash flow statement cannot help to replacezan income statementjand akfund

flowhstatement.
2. It shows only inflow and out flow. But it doesunot revealkthe true
liquidbposition of the business.

3. It does not give completezpicture ofcfinancial position ofpthe company.

4. Itkis not a substituteyof incomesstatement
5. Thebaccuracyhof cash flow statementkis based on the balanceusheet, if a
balance wrong, cash flow statementhis alsouwrong.

RATIO ANALYIS
Current assets
Current ratio =
Current liablities
Year Current Assets Current Current ratio

Liablities
2017 123518.29 193571.17 0.63
2016 80778.22 94949.57 0.85
2015 52938.36 42986.25 1.23
2014 32932.45 33612.56 0.97
2013 21058.24 24373.76 0.86
1.4
1.2
0.8
0.6
0.4
0.2
0
2017 2016 2015 2014 2013
INTERPRETATION :
A minimum standard ratio is considered as 2:1 in all five years it so far below then
expected lavel. For the past five years the highest (1.23) and least (0.63) has recorded

Cash and Cash equivalents

Absolute liquid ratio =
Current liablities
Year Cash and Cash Current Liablities Absolute ratio

equivalents
2017 1622.45 193571.17 0.008
2016 1127.21 94949.57 0.01
2015 990.24 42986.25 0.023
2014 653.21 33612.56 0.019
2013 13344.36 24373.76 0.54
0.6
0.5
0.4
0.3
0.2
0.1
0
2017 2016 2015 2014 2013
INTERPRETATION:
Absolute ratio is measured in terms of 1:1 by using the cash and cash equalints and
current liablities to prevent the relationship of past five years and the highest is (0.54)
least is ( 0.008) of the company

Shareholders fund
Proprietary ratio =
Total assets
Year Shareholders fund Total assets Proprietary

ratio
2017 47588.21 491488.65 0.96
2016 27576.70 330123.97 0.083
2015 17315.85 211942.4 0.081
2014 12151.99 137764.06 0.088
2013 7663.45 157954.96 0.048
1.2
0.8
0.6
0.4
0.2
0
2017 2016 2015 2014 2013
INTERPRETATION:
Ratio is maintened in the praportion of 2:1 as the relation between the Shareholdres
equirty and total assets of the company. And the highest is (0.96) least is (0.048)

Cash flow from operation

Operating cash flow ratio =
Sales
Year Cash flow from Sales Operating cash

operation flow ratio
2017 70333.54 124384.01 0.56
2016 49536.90 (97751.37) (0.50)
2015 32830.44 62760.54 0.52
2014 32151.94 21243.53 0.015
2013 19329.14 14036.37 1.37
1.5
0.5
0
2017 2016 2015 2014 2013
-0.5
-1
INTERPRETATION:
Operating cash flow was declined drastically in the year 2016 as (0.50) it will impact
on cash and cash equalints so we need to maintain cash postion at the company.


Asset efficiency ratio =
Total assets
Year Cash flow from Total assets Asset

operation efficiency
ratio
2017 70333.54 491488.65 0.14
2016 49536.90 330123.97 0.15
2015 32830.44 211942.4 0.15
2014 32151.94 137764.06 0.23
2013 19329.14 157954.96 0.12
0.25
0.2
0.15
0.1
0.05
0
2017 2016 2015 2014 2013
INTERPRETATION:
In this ratio we come to know that liquidity of cash position was decereasing and
increasing the Value of total assets praportion to the operating cash flow as highest
(0.23) least ( 0.12) of the organization


Current liablity coverage ratio =
Current liablities
Year Cash flow from Current Current

operation Liablities liablity
coverage ratio
2017 70333.54 193571.17 0.36
2016 49536.90 94949.57 0.52
2015 32830.44 42986.25 0.76
2014 32151.94 33612.56 0.95
2013 19329.14 24373.76 0.79
1.2
0.8
0.6
0.4
0.2
0
2017 2016 2015 2014 2013
INTERPRETATION:
In this rato we come to know that the we need to maintain standard postion in the
market situation for the organization and the highest was (0.95) and least (0.36) in
current year a praportion was maintanied good

HYPOTHESES TESTING :
The objectives of the projectb being :
1. To Understand the Free Cash Flow System

2. To calculate the Current Free Cash Flow Position
3. To analyse the effect of free cash flows on financial position of the company
On the basis of above objectives the following hypotheses are being framed for the
purpose of establishing relationship between the variables and to test the
interdependency of each variable, through a suitable statistical tool to arrive at the
conclusion on acceptance or rejection of Null hypotheses. The required data is taken
from the calculations pertaining to the title of the project. The hypotheses are as
follows.
H0:There is no significant effect of free cash flows on financial position of the

company
H1: There is significant effect of free cash flows on financial position of the company
The below statistical tools are been used for the purpose of hypotheses testing.
 Spearman’s Rank correlation

 Coefficient of co-relation.
The result obtained is compared with standard value of the table and the decision is
being stated.
Spearman’sRank correlation
Year Net profit Free cash flow

2017 8300.55 123864.6
2016 3,401.61 97396.18
2015 4417.34 62729.18
2014 2,707.85 31864.79
2013 2031.78 9931.92

X Y rank(x) rank (y) R1 - R2 (R1-R2)2

8300.55 123864.6 5 5 0 0
3,401.61 97396.18 3 4 -1 1
4417.34 62729.18 4 3 1 1
2,707.85 31864.79 2 2 0 0
2031.78 9931.92 1 1 0 0
Total 2
ƍxy = 1- (6Ʃ (R1- R2)²)
N (n²-1)
1- (6×2)
5(5²-1)
1- 12
45
= 1-0.2667
ƍxy = 0.733
Coefficient of co-relation:
X Y
8300.55 123864.6
3401.61 97396.18
4417.34 62729.18
2707.85 31864.79
2031.78 9931.92

X Y
X 1 0.83520345
Y 0.83520345 1
X Y XY X2 Y2
8300.55 123864.6 1028144306 68899130.3 15342439133
3401.61 97396.18 331303819.8 11570950.59 9486015879
4417.34 62729.18 277096116 19512892.68 3934950023
2707.85 31864.79 86285071.6 7332451.623 1015364842
2031.78 9931.92 20179476.42 4128129.968 98643034.89
20859.13 325786.67 1743008789 111443555.2 29877412912
N.∑XY - ∑X.∑Y
√N.∑X2 - (∑X)2.√N.∑Y2-(∑Y)2
√N.∑X2 (∑X)2 122114471.4 11050.54168
√N.∑Y2 (∑Y)2 43250110210 207966.6084
= 1919417445
= 2298143674
= 0.8352

ESTIMATIONOF FREE CASH FLOW
Developing free money streams are as often as possible a prelude to expanded income.
Organizations that experience surging FCF - because of income development,
proficiency enhancements, cost diminishments, share purchase backs, profit
circulations or obligation disposal - can remunerate financial specialists tomorrow.
That is the reason numerous in the venture group treasure FCF as a measure of
significant worth. At the point when an association's offer cost is low and free income
is on the ascent, the chances are great that profit and offer esteem will soon be heading
up.
To ascertain free income another way, you'll require the salary explanation and
accounting report. Begin with net pay and include back charges for deterioration and
amortization. Roll out an extra change for improvements in Working capital which is
finished by subtracting current liabilities from current resources. At that point subtract
capital use (or spending on plants and gear)
Net income
(+)Depreciation / Amortisation
(-)Change in Working Capital
(-)Capital
Free Cash Flow
There are various ways to compute for FCF, although they should all give the same
results. The Formula Below is Simple and the most commonly used formula for free
cash flow
Free Cash Flow = Operating Cash Flow – Capital Expenditure

AS ON 31ST MARCH 2017
PARTICULARS AMOUNT
CASH FROM OPERATING ACTIVITIES

{Profit before taxes and contingencies and exceptional items add or 12,690.26
loss}
Depreciation and amortisation expenses 528.04

Loss or profit on sale of asset 1.25
Provision for non- performing assets 5,537.93
General provision for standard assets 545.36
Operating profit before working capital changes 19,302.84

Less: increase or decrease in loans and advances (159,254.27)
Add :increase in current liabilities 20,789.75
Cash generated from operations (119,161.98)

Advance tax paid (5,222.33)
Net cash generated from operating activities (a) (124,384.01)

PARTICULARS AMOUNT

{Profit before taxes and contingencies and exceptional items add or loss} 9669.64

Provision for non- performing assets 3112.64
Operating profit before working capital changes 13552.50

Less: increase or decrease in loans and advances (117127.48)
Add :increase in current liabilities 9786.92
Cash generated from operations (93788.06)

Advance tax paid (3963.31)
Net cash generated from operating activities (97751.37)

PARTICULARS AMOUNT

{Profit before taxes and contingencies and exceptional items add or loss} 6731.80

Provision for non- performing assets 1379.41

Less: increase or decrease in loans and advances (74420.48)
Add :increase in current liabilities 5293.93
Cash generated from operations 60461.02

Advance tax paid 2299.52
Net cash generated from operating activities 62760.54

PARTICULARS AMOUNT

{Profit before taxes from continuing operations} 3680.21

Non- cash adjustment to reconclle profit before tax to net cash flows
Depreciation / amortisation on continuing operation 143.22
Loss on termination 55.12
Loss/(profit) on sale of fixed assets -
Intrest expenseassets 8825.28
Provision for non performing 837.15
General provision on standard assets 174.13
Movements in working capital:
Increase/(decerease) in trade payables 346.91
Increase/(decerease) in long term provisions 23.09
Increase/(decerease) in short term provisions 115.38
Increase/(decerease) in other current liablities 2572.68
Decerease/(incerease) in long –term loans and advances (35822.05)
Decerease/(incerease) in short –term loans and advances (11793.40)
Cash generated from/ (used in) operations (30842.28)

Direct taxes paid (net of refunds) (1309.66)
Net cash flow from operating activities (32151.94)

PARTICULARS AMOUNT

{Profit before taxes from continuing operations} 2740.64

Non- cash adjustment to reconclle profit before tax to net cash flows
Depreciation / amortisation on continuing operation 108.26
Loss on termination 19.33
Loss/(profit) on sale of fixed assets 0.72
Intrest expenseassets 5501.68
Provision for non performing 325.90
General provision on standard assets 133.40
Movements in working capital
Increase/(decerease) in trade payables 442.65
Increase/(decerease) in long term provisions 0.44
Increase/(decerease) in short term provisions 79.93
Increase/(decerease) in other current liablities 6706.56
Decerease/(incerease) in long –term loans and advances (24943.43)
Decerease/(incerease) in short –term loans and advances (9636.87)
Cash generated from/ (used in) operations (18520.91)
Direct taxes paid (net of refunds) (808.23)
Net cash flow from operating activities (19329.14)

 Working Note
Calculation of Capital Expenditure
Previous Year Current year capital Capital

Capital Assets Assets expenditure
2012 2013 2012-2013
9892.30 495.08 9397.22
2013 2014 2013-2014

495.08 722.23 287.15
2014 2015 2014-2015

722.23 690.87 31.36
2015 2016 2015-2016

690.87 1046.06 355.19
2016 2017 2016-2017

1046.06 1565.47 519.41

Free Cash flow = Operating Cash flow - Capital Expenditures
2017 = (124,384.01) -519.41
= ( 123864.6)
2016 = (97751.37) - 355.19
= (97396.18)
2015 = 62760.54- 31.36
= 62729.18
2014 = (32151.94) - 287.15
= (31864.79)
2013 = (19329.14) - 9397.22
= ( 9931.92)

5.1 FINDINGS
 The past five years current ratioindicates highest ratio at (1.23) and least ratio
is (0.63) ButCurrent ratio is acceptable as 2:1 and from 2013 to 2015 current
assets are in incresing order, from2015 to 2017 current liablities are in
decerasing order.
 Absolute liquid ratio is measured as 1:1 to prevent the relationship of past
five years; the ratio currently stands at a high of (0.54) least is ( 0.008). ratio is
in deceresing order from 2013 to 2017.
 Proprietory Ratio is an proportion of 2:1 assets of the company,currently the
ratio is at a high of (0.96) least is (0.048) share holders fund is in incresing
order
 The operating cash flow ratio has declined drastically as considering at 0.50
for five years
 Asset efficiency ratio considered as the highest is (0.23) least is ( 0.12).
 Current liablity coverage ratio has maintaied standard postion in the market
the highest value is (0.95) and the least is (0.36) in current year

SUGGESTIONS
 The current ratio of the organization is below the normal level of 2:1 for the
past five years which is not good to the Organization so they have to
concentare on company assets.
 The absolute liquid ratio of the organization is below 1:1 for the past five years
which is not good sign for the organizations current liquidty.
 Standard level of equity ratio is 2:1 it hasto maintanined the level
 Operating cash flow has to maintained as cash reserve and cash equilants
 Asset efficiency ratio’s standard level is1:1 is not maintained perfectly
 Current liablity coverage ratio has decereased in the current year so the
position of the compamy is good in market situation
 The significant of free cash flows and financial position is good sign for the
company.
 A financial position is proved by using the spearmens rank correlation is ƍxy =
0.733 as good to the organization position
 Aprofit and financial postion is determined by using coefficient of correlation
as r = 0.835203411.
 For the calculation of free cash flow we required depreciation or amortisation
and capital expenditure to measure the experience of FCF to the growth and
efficiency of cash

5.3 CONCLUSION
The Study on, ‘ EFFECT OF FREE CASH FLOW ON PROFITABLITY FIRMS’,

Has considerd the various secondary documents and has assined at the inferance as
discussed this usings out of thease
 The net profit of the organization is not in the satisfactory level , where it has
to be incereased. The organization should exercise proper control over all
about expenditures and profits
 The organization has to maintain standard level of current ratio.
 It is necessary to know the efficiency of employees in the organization
 It has to know about economic condition in the market
 They can expand the business in broad manner
 The business in concern to only rural areas they should spread over it urban
areas also
 MAHINDRA HOME FINANCE has to review its loan policy to constuct the
more profits to the company .
 This has to improve its liquidty postion in all the five years
 A finance has to increase the margin of operating cash flows and net profits of
the organizaton
 To satisfy their customers and for good dealings MAHINDRA HOME
FINANCE has to make prompt disbursment of loan amount to the customers.
 A company has to guide a loan procedure and disbursment process, approval,
loan sancation such services has to explain to the customers as well as
illitaretwe people

Bibilography:
 www.mahindra rural housing finance.com

 www.wishfin.com;home loan
 www.scribed .com
 Management Accounting by B. S Raman; United publications
 Berstain David (2009), Engage,vol.10,No.1,pp 2009 , George Mason law
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Mahindra Home Finance: Mba Department - The Oxford College of Engineering

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Mahindra Home Finance: Mba Department - The Oxford College of Engineering

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MAHINDRA HOME FINANCE

This internshipqprogramqishdesigned for the students to engaged in a field of

An internship provides more accurate picture of whatcindividualssdo

Purpose of Internship: To understand working culture of the Organization and

Type of work done in the Organization: -

 Filling the loan agreement forms

Duration of Internship: 16th January 2018 to 24th March 2018

Place of Internship: Bangalore

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 1

1.2 INDUSTRY PROFILE:

Our companyofocuses primarilyuon providingpfinancing for:

We have several awards,aincludingzthe IDC EnterprisexInnovationzawards,

 We ranked 186th in the list of India’s Most valuable Companieszin the

We will probably be the favoured supplier of budgetary administrations, across the

Furthermore, we give discount stock – financingztozmerchants andzretail financinguto

DIFFERENT TYPES OF NBFCS ARE AS FOLLOWS:

An AFC is an organizationzwhich is axmonetary foundationzcarrying on as

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 3

emergingbalong these lines isn'tuunder 60% of itspaggregate resources and

 Investment Company (IC)

IC implies any organizationzwhich isxmoneycrelatedbestablishment carryingmon as

LC implieszany organization whichxis a money related establishment

Framework back organizations send at least three-fourths of their aggregate

 Infrastructure DebtzFund: Non- BankingkFinancialoCompany

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 4

NBFCspperform capacities like thatmofxbanks yet there areua couple of

1. AnzNBFCxcannot acknowledge Demand Deposits.

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 5

a) NBFCS can't acknowledge request stores, that is regularly subsidizes

b) Deposit protectionaoffice ofpDICGCa(Deposit Insurance and Credit

c) It is required underzSectionx45-IA RBI, 1934 eachpNBFC to sign up

d) Enlisting considering the RBI requires the accommodation related

CRITIRIA FOR SELECTING NBFCS FUNCTIONS:

a) Equipment renting organizations

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 6

e) Rules and directions are a piece of each firm and arrangement.

1.3 COMPANY PROFILE:

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 7

MRHFLzcurrently works in different areas all throughzthe nation which incorporate

We ensure that our clients' fundamental need of sanctuary is met conveniently. We

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 8

As ofzMarch 31,x2016, we kept up a non-performing resource ("NPA") scope

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 9

The company offers various investment suggestions to customers like:

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 10

Mr. Ramesh Iyerz

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 11

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 12

zMr. Anuj Mehra

Mr. Nityanath Ghanekar

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 13

Ms. Anjali Raina

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 14

1.5 VISION, MISSION &QUALITY POLICY:

To be a main monetary administrations supplier in rustic India, Mahindra home back

1.6 PRODUCTS / SERVICES:

Funds, country andosemi-urbanppopulation to assemble self-managing

MBA DEPARTMENT – THE OXFORD COLLEGE OF ENGINEERING Page 15

Vehicle Financing gives a utility administration as Construction of pre -

Giving Insurance answers for retail clients and additionally companies

MUTUAL FUND DISTRIBUTION

Prompts customers on contributing cash through AMFI guaranteed experts

The sign of abnormal state of well-being and Security.