A

PROJECT REPORT
ON
“WORKING CAPITAL MANAGEMENT”

AT

“CREATIVE CARVE PVT LTD.”

BHOSARI MIDC, PUNE.

SUBMITTED TO
SAVITRIBAI PHULE PUNE UNIVERSITY
In Partial Fulfillment of Requirements
For the Award of Requirements of
MASTER OF BUSINESS ADIMNISTRATION (MBA)
BY
MISS.DURGADE DHANASHRI
PROJECT GUIDE
PROF. VINOD BHELOSE
NAVSAHYADRI EDUCATION SOCIETY’S GROUP OF INSTITUTES
FACULTY OF MANAGEMENT- MBA
NAIGAON (NASRAPUR), TAL, BHOR
PUNE -412213

BATCH 2018-2019

ACKNOWLEDGEMENT
It is a matter of great satisfaction and pleasure to present this report on “Working Capital Management” at
“Creative Carve Pvt Ltd (Pune)”. I take this opportunity to owe my thanks to all those involved in my training.

I am thankful of Mr. Dinesh Gour (HEAD OF FINANCE) for giving me opportunity to work Creative Carve Pvt. Ltd
(Pune). As an Implant trainee.
I am also thankful for their encouragement and able guidance at every stage of my training work.
I would also like to give thanks to the whole Organization as they gave me opportunity to conduct this project and
also extending hours in doing this project

I would like to thank our Director Dr. K.S. Charakand Project guide Prof. VinodBhelose
Whose valuable guidance and encouragement at every phase of the project has helped to prepare this project
successfully. I am thankful for their encouragement and able guidance at every stage of my project work.

I express my gratitude towards staff, who have helped me directly or indirectly in completing the project.

Place:

Date: / / Name of the Student

Mss.Dhanashri Durgade
 DECLARATION

I hereby declare that the project titled “Working Capital Management” is an original
piece of research work carried out by me under the guidance and supervision
of “Prof.Vinod Bhlose”. The information has been collected from genuine & authentic
sources. The work has been submitted in partial fulfilment of the requirement of
Masters of Business Administration to Savitribai Phule Pune University.

Place: Name of the student

Date: Mss. Dhanashri Durgade

Sr. Page
No. TABLE OF CONTENTS No.

CHAPTER I INTRODUCTION
1.1 Introduction
1.2 Selection of the topic
1.3 Objectives of the study
1.4 Scope of the study
1.5 Limitation of the project

CHAPTER II CONCEPT & METHODOLOGY

to
study
2.1 Concepts relating topic
2.2 Research methodology
2.3 Sources of Data
2.4 Methods of Data gathering

CHAPTER III ORGANIZATION PROFILE

3.1 About the organization
3.2 Mission, Vision of the organization
3.3 Board of directors of Organization
3.4 Different product profile of the organization

CHAPTER IV SUMMARY AND CONCLUSIONS

5.1 Major findings
5.2 Suggestions
5.3 Conclusions
CHAPTER V BIBLOGRAPHY

CHAPTER NO. 1
 INTRODUCTION

1.1 Introduction of the Topic

The project is undertaken is on Working Capital management in Creative Carve

Pvt. Ltd Limited.
It describes about how the company manage its working capital and the various
steps that are required in the management of working capital.
Working capital refers to the cash a business requires for day- to- day operation or,
more specifically, for financing the conversion of row materials into finished
goods, which the company sells for payment. Among the most important items of
working capital are levels of inventory, accounts receivables, and account payable.
Analysis look at these items for signs of a company’s efficiency and financial
strength.
The working capital Is an important yardstick to measure the company’s
Operational and financial efficiency. Any company should have a right amount of
cash and lines of credit for it business needs at all times.
This project describes how the management of working capital takes place at
Creative Carve Pvt. limited.
 1.2 Objectives of the study
 To study the concept of working capital management
 To study the working capital structure of Creative Carve Pvt. Limited.
 To study of liquidity position through various working capital related ratio.
 To draw the observation based on study & suggest suitable measure to
improve performance

1.3 Scope of the study

Working capital is backbone of the organization, as it provides

number of services, some of them are mention below.
 It required for uninterrupted business operation.
 To ensure maximizing the wealth of the organization.
 To meet short term obligation of the organization.
 To minimize cost of working capital.
 It is essential to run day to activities.
 1.4 Limitations of the study

 The main limitation of the research is the data sources. The data collection from
the audited financial statement, which are prepared on the historical basis.
 These financial statement are prepared at the end of the financial year. So it
gives a view on particular date.
 Only the printed data about the company will be available and not the back end
details

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CHAPTER - 2
 CONCEPT AND RESEARCH METHODOLOGY

2.1 “Working capital is the LIFE-Blood and controlling never

center of a business”
The working capital management precisely to management of current asset.A
firm working capital consists of its investment in current assets, which include
short-term asset such as:

Cash and bank balance

Inventories

Receivables (including debtors and bills)

Marketable securities.

Working capital is commonly defined as the difference between current assets

and current liabilities.
Working Capital=Current Assets-Current Liabilities
There are two major of working capital:

Gross working capital

Net working capital

Gross working capital:

It refers to firm’s investment in current assets. Current assets are the assets,
which can be converted into cash with a financial year. The gross working
capital points to the need of arranging funds to finance current assets.
Net working capital:
It refers to the difference between current assets and current liabilities.
Networking capital can be positive or negative. A positive net working capital
will arise when current assets exceed current liabilities, And vice-versa for
negative net working capital. Net working capital is a qualitative concept. It
indicates the liquidity position of the firm and suggests the extent to which
working capital needs may be financed by permanent sources of funds.

SIGNIFICANCE OF WORKING CAPITAL MANAGEMENT

 Payment of

Suppliers
Easy
Loan Dividen
From d
Significance Distribut
of Working ion

Capital

Increase
Increase in
Debt
efficiency
Capacit

Increase in fixed
asset

Classification of working capital

 Working Capital

On the basic
of concept On the basic of
periodic
requirement

Gross Net

Positive Negative

Permanent/fixed Tempora
working capital ry
working

Regular Reserve Seasona Special

Working Margin
Capital

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A) Permanent Working Capital:
There is always a minimum level of working capital, 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 asset, this minimum level of current assets, which must be maintain by
any firm all the times, is Known is permanent working capital for that firm. This amount
of working capital is constantly and regularly required in the same way as fixed assets are
required. So, it may also be called fixed working capital

B) Temporary working capital:

Any amount over and above the permanent level of working capital is temporary,
fluctuating or variables working capital. The position of the required working capital is
needed to meet fluctuation in demand consequent upon change in production and sales as
a result of seasonal changes.

Factors affecting working capital:

The working capital needs of firm are affected by numerous are as follows:
a) Nature of Business:

In some business organization, the sales are monthly on cash basis and the
operating cycle is also very short. In these concern, the working capital
requirement is comparatively less. Mostly services giving companies come in
the category. In manufacturing concerns, usually the operating cycle is very long
and a firm has to give credit o customer for improving sales. In such cases the
working capital requirement.
b) Production Policy:

Working capital requirement also fluctuate according to the production policy.

Some productions have seasonal demand but in order to eliminate the fluctuation
in working capital, the manufacturing plans the production in a stedy flow
throughout the year. This policy will even out fluctuation in working capital.

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c) Market Condition:

Due to competition in the market, the demands for working capital fluctuate. In
a competition environment, a business firm has to give liberal credit to
customer. Similarly it has to maintain a large inventory of finished goods to
services the customers promptly. In this situation, larger amount of working
capital will be required.
d) Growth and expansion activities:

The working capital needs of the firm increases as it grows in terms ofsalesor
fixed assets. This will in turns increase investment in current assets which will
result in increase in working capital needs.
e) Operating efficiency:

The operating efficiency of the firm relates to the optimum utilization of

resources at minimum cost .The firm will be effectively contribution to its
working capital if it is efficient in controlling operating costs. The working
capital is better utilized and cash cycle is reduced which decrease working
capitals needs.
f) Sales Growth:

As the sales grow, the working capital needs also go up. Actually it is very
difficult to establish and exact proportion of increase in current assets, as a result
of increase in sales.

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OPERATING CYCLE CONCEPT:

Working capital is the life blood of any business, without which the fixed assets
are inoperative. Working capital circulate in the business, and the current assets
change from one form to these other. Cash is used for procurement of row
material and stores items and for payment of operating expenses, and then
converted into work in progress then to finished goods. When the finished goods
are sold on credit terms receivables balance will be formed. When the receivable
are collected it is again converted into cash. The need for working capital arises
because of the time gap between production of goods and their actual realization
after sales. The time gap is called technically called as ‘operating cycle’ or
‘working capital cycle’. The operating cycle of a company consist of time period
between the procurement on inventory and the collection of cash from
receivables.

CASH

ACCOUNTS
RAW
RECEVABLE MATERIA

FINISHED
GOODS WORK- IN-
PROGRESS
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 GROSS OPERATING CYCLE:-
The total of inventory conversion period and debtor’s conversion period is
referred as gross operating cycle.(GOC)

Gross operating cycle = inventory conversion period + Debtors conversion

period
GOC=ICP+DCP
 Inventory turnover ratio = sales
Inventory
Inventory conversion period = 360
Inventory turnover ratio
 Debtors turnover ratio = sales
Debtors

WORKING CAPITALRATIO’S

Ratio analysis is a process of comparison of one figure against another, which

makes a ratio. It is a power full analytical tool useful for measuring performance
of an organization. It’s extremely helpful providing valuable insight into a
company’s financial picture. Ratios normally pinpoint a business, strengths &
weakness.

The ratio analysis is made under six broad as follows-

1) Liquidity ratios

Liquidity refers to the ability of the firms to the meet it’s obligations in the short
run usually one year. Liquidity ratios are generally based on the relation between
current assets and current liabilities.

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2) Turnover ratio
They measures how efficiently the assets are employed by the firm. These ratio
are based on the relationship between the level of activity, represented by the
sales or cost of goods sold and levels of activity. Represented by the sales or
cost of goods sold and levels of various assets
3) Profitability ratios

This help in assessing the adequacy of profit earned by the company and also to
discover whether profitability is increasing or decreasing. There are two types of
ratios profit margin ratios and rate of return ratios. Profit margin ratios show the
relationship between profit and sales. Rate of return ratios reflect the
relationship between profit and investment.
2.2 Research Methodology

This project required a detailed understanding of the concept on working capital

Management. Therefore, firstly we need to have a clear idea of what is working
capital, how it is managed in Crative Carve Pvt.Ltd Limited, what are the
difference ways in which the financing of working capital is done in the
company.
The management of workingcapital involves managing inventories, accounts
receivable and payable and cash. Therefore one also need to have a sound
knowledge about cash management, inventory management and receivable
management.
Then comes the financing of working capital requirement, i.e. how the working
capital is financed, what are the various sources through which t is done
And in the end, suggestion and recommendation on ways for better
management and control of working capital are provided.
Meaning
Financial research is the systematic design collection, analysis and reporting of
the data and finding relevant information to specific to finance situation faced
by the company. A study can be commission by a manufacturing company to
find out the various facilities that can be television sets based on the above
discussion. Similarly, study can be conducted by broadcasting station to find out
the degree of the utility.

Definition of research
D. Slesinger& M. Stephenson define the research as “The manipulation of
things, concept of symbols for the purpose of generalizing to extent, correct of
verify knowledge, whether that knowledge aids in construction of theory or in
the practice of an art”. Clifford Woody define the research as, “ the process
which includes defining the problems, formulating hypothesis or sugge1sting
solutions; collecting, organizing & evaluating data; making deduction &
reaching conclusion & at last carefully testing the conclusion to determine
whether they fit the formulating hypothesis’.
Importance of research
1. Research provides the guidance to the social planning.
2. Research facilities control by the providing knowledge.
3. Research is important because it suggest effective remedial measures.
4. Research affords considerably sound for prediction.
 2.3 Sources of Data
Mainly there are two type of data used for research. These types are,

1. Primary Data:

We are collected data during the course of doing experiment in experimental

research we can obtain primary data either through observation or through direct
communication with respondent in one form or another or through personal
interview. Primary data is collected personally to be used. Primary data is
firsthand information collected by research from observation communication.

2. Secondary data:

Secondary data mean the data that are already available i.e. they refer to the data
which have already been collected & analyzed by someone else. These data is
collected from the financial reports of the bank. The data which are primary in
hands of ne becomes secondary In hands of other.
 2.4 Sources & Methods of Data Collection
There are different from which primary & secondary data has been collected.
These are;
A) Observation:
Observation is most commonly used method especiallyin behavioral science.
The information obtain under this method relates to what is currently happening,
it is not complicated by either the past behavior or future intension. In
observation method it is enable to record the natural behavior of group.
B) Questioner:

This method of data collection is quite popular. A questionnaire consists

of the number of questions which are mailed to respondents who are rad &
understand the questions and write down the reply of those questions. These
types of questions are mostly used in various economic and business surveys.
C) Personal Interview:

Personal interview method requires a person known as the interviewer

asking questions generally in face to face contact to the other person or person.
Personal interview techniques is verbal method of securing data especially in the
file of research.Personal interviewing is two way purposeful conversation
initiated by an interviewer to obtain information that is relevant to some
research purpose.
Sources Data
Research refers to the systematic consisting of enunciating the problem a
hypothesis, collecting the facts analyzing the facts reaching the certain
conclusion either in form of solution towards the concerned problem or for some
theoretical formulation.
It is important and essential to adopt pre-decided method of study. The data
available for the project was in the form of written as well verbal information
regarding working capital finance by the company.
In order to collect the information following methods are adopted:

Sources of Data
The major sources of data were secondary data, where in the balance sheets and
profit and loss statement were basically used to find about the figures needed for
the analysis.
The balance sheets and profit and loss statement for the four previous years
were used.
The primary data was obtained though discussions with the senior
managers and chief finance officer (CFO).

Collection of Data
All the relevant information about the project was obtained from the
company’s financial statement; books on financial management were also used
for collection of data which were used for the analysis part.

1.Primary Data:
We are collected data during the course of doing experiment in experimental
research we can obtain primary data either through observation or through direct
communication with respondent in one form or another or through personal
interview. Primary data is collected personally to be used. Primary data is first
than information collected by research from observation communication.
2.Secondary data:
Secondary data mean the data that are already available i.e. they refer to the data
which have already been collected & analyzed by someone else. These data is
collected from the financial reports of the bank. The data which are primary in
hands of ne becomes secondary In hands of other.
CHAPTER – 3

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 ORGANIZATION PROFILE
3.1 COMPANY PROFILE:

CREATIVE CARVE PRIVATE LTD

Sector No. 7, Plot no 308/309, PCNTDA, Bhosari Pune 411 026
Tel No. +91 20 66329701/66329713
Fax +91 20 66329726

Introduction
Company was registered in the year 1985 with Registrar Of Companies as
closely held family business.
The Company was established to serve Automobile industry with precision-
machined components.
CCPL commenced production in the year 1986-87.
Operations were started with machining of Valve Tappets and Valve Seat Inserts
(Rings) supplied to M/s Pefco Foundry and Chemicals and initial turnover of
Rs. 5.00 lacs.
Since then the company has progressed steadily to target a turnover of Rs. 100
Million in the year 2005-06. We now manufacture variety of Disc Brake Pistons,
Differential Pins (for idler gears), Wheel Spindles, Retainer rings. We even cater
to Defence requirements for critical components and have developed
components.
We have continuously updated our manufacturing facilities to achieve quality
and economy in our operations.
Secret of success lies in CUSTOMER SATISFACTION through the Quality
standards and service. While maintaining the highest quality standards, economy

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in operations has been base of our working. The unit enjoys SELF
CERTIFICATION status at most of customers.
th
We are an ISO 9001-2000 certification since 10 September, 2002.
ISO Registration number (RQ91/856.) along with IATF16949:2016.
We have yet to fail on customer delivery schedules and commitments. In fact
90% of urgency and emergency calls of customer for non-scheduled supplies
are met with. This has resulted in customer confidence in us giving us
distinction.

SINGLE SOURCE for most of the components produced by us for almost all our
customers.

Components manufactured by us have found 100% acceptance with overseas

OEM’s in Italy, UK and USA, supplied to overseas market through our local
customers.
CCPL are proud of our dedicated team drawn from cross section of society and
coming from different states of our country. Each one of us is committed to
highest efficiency and is putting in our best efforts.
CCPL are happy to present a brief insight in to our present profile and
operations.

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 3.2 COMPANY MISSION AND VISION:

3.2.1 Mission:

- Providing ideal working environment

- Be the most preferred organization to work with
- Build share value and belief among all level of people
- Providing quality above salf.

3.2.2 Vision

-To evolve as an brand in India and overseas markets

-Significant contribution to Indian economy,

3.2.3. Values
- Integrity
- Dignity
- Honesty
- Leading Changes
- Excellence
- Respect for Individuals
- Learning And Sharing

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 3.3 Quality Policy

We are committed to systematic functioning of all business processes to achieve

highest Quality of our products. We firmly believe that our growth is in
achieving the Best Quality standards in our industry.

Customers Satisfaction is our main goal and we work ceaselessly to achieve this
objective.

We will work for continuous improvement and development of our people,

processes and technology to meet the competition and achieve growth.

3.4 Product Range

Crative Carve Pvt.Ltd manufacture various components varying from 100 MM

to 1200 MM in size. Crative Carve Pvt.Ltd manufacturecustomized products for
reputed Original Equipment Manufacturers (OEMs) of diverse industries such as
passenger cars,two wheelers, tractors, construction machineries, railways, light
vehicles, off-highway, heavy trucks.We believe that maintaining a diverse
portfolio in our business provides us with an opportunity to cater to diverse
needs ofour different customer segment.

 Differential Housing
 Axle Components
 Transmission Components
 Automotive Components
 Other Components

23
 3.4 Pruduct Profile

DIFFERENTIAL HOUSING

AXLE COMPONENT

24
TRANSMISSION

25
AUTOMOTIVE COMONENTS

OTHER COMPONENTS

26
 3.5 Manufacturing Process:

Crative Carve Pvt.Ltd machines are equipped for both individual and diversified
processes, and their flexibility enables us to employ them inthe most optimum
manner to suit the customer‘s preferences. Additionally, most of our machinery
with certainmodification is capable of being used interchangeably for either of
our sectors, depending on the demand for such products.
We have and may have dedicated production lines based on the size and
frequency of the orders of our customers.Typically, our manufacturing process
consists of machining inspection and assembly (if any). The production process
maybe diagrammatically explained in the following manner:

Receipt of raw material Inspection of raw material

Proof machining Semi finish machining

Special process like heat treatment induction Finish

hardening machining

Visual inspection Final pre dispatch

Inspection

27
3.5 Organization Flow Chart

28
3.6. Production Process Flow:

29
3.7 Organizational Working System:
CHAPTER – 5
5.1 SUGGESTIONS
 In the year 2015 the net working capital ratio is positive & In the year 2015&

2017 the net working capital are negative its means the company’s current
assets is lowest than current liabilities. So they should try to increase their
current assets.

 The current ratio & quick ratio of the company’s are decrease so the both
ratios should be increase up to standard ratio.

 The Turnover ratio of the company is satisfactory so company should try to

maintain turnover ratio for company’s best perform in future.

 The profitability ratio of the company is well but the company should try to
improve profitable ratio for better performance in future.

48
5.2 CONCLUSION

Experience and Insights:

At the end, my internship experience was very good and a remarkable one as I
got to know many new insights and came under practical understandings of the
situations and business model. Also, at the same time I was very happy and
lucky enough because I did have the chance to visit and experience in Creative
Carve Pvt .Ltd
I also had an opportunity to learn and gain knowledge on organizations day
to day routine work of various functions especially finance department to
enhance my knowledge bank. The Company is having very good budgeting
practice and its monthly monitoring system
The company’s net working capital is negative in the year 2014 & 2016 but the
year 2015 the company’s net working capital is good. The companies turnover
ratio is also satisfactory.

This project work in the in finance sector is going to help me a lot in future. I got
to learn many financial aspects of the organization. It was great opportunity for
me to do my Summer Project at Creative Carve Pvt. Ltd.
 \
B IB LO G RAPHY

Books:-
 FINANCIAL MANAGEMENT BY I.M. PANDEY
 FINANCIAL MANAGEMENT BY PRASANNA CHANDRA.
 ANNUAL REPORT OF CREATIVE CARVE PVT LTD.

Website:-
 www.creativecarve.com
 www.wikipedia.com

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