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CHAPTER-1
INTRODUCTION OF THE STUDY
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INTRODUCTION
 Finance:
Finance plays an important role in any organization. It is defined as the
management of money and includes activities like investing, borrowing, lending,
budgeting, saving, and forecasting. The dictionary meaning of finance is money
affairs or the art of managing or administrating the public money. Hence the name
financial management could also be referred as money management. The function of
finance is not only arranging funds for the business organization but also includes
planning, forecasting of cash flow, both receipts and payments, raising the funds,
allocation of funds and financial control.
Efficient management of financial resources and deliberate analysis results for the
success of an enterprise. Financial statements are the basis for decision making for the
management and also for the other outsiders who are interested in the affairs of the
firm. Financial management involves in the finance function. It is concerned with the
planning, organizing, directing, and controlling the financial activities of an enterprise.
It deals mainly with raising funds in the most economic and suitable manner, using
these funds as profitably as possible; planning future operations and controlling current
performance and future developments through financial accounting, cost accounting,
budgeting, statistics and other means management. It is continuous process which
achieves an adequate rate of return on investment, as this is necessary for survival and
the attracting of new capital.
The financial manager must see that funds are procured in a manner that the risk,
cost and control, considerations are properly balanced in a given situation and there is
optimum utilization of funds. The financial manager should estimate the total
requirements of the funds, for both short & long period. The financial manager
assesses the financial position of the
company through the working out on the return on capital, debit-equity ratio and cost
of capital from each source etc...., And comparison of the capital structure with that
similar companies.
 Introduction of financial analysis:

Financial analysis is the process of identifying the financial strength and weakness
of the firm by proper establishment between the items of balance sheet & profit and
loss account. There are various methods or techniques used for analyzing financial
statements such as comparative statements, trend analysis, common size statements,
schedule of changes in working capital, funds flow and cash flow analysis – Cost
Volume Profit Analysis and Ratio Analysis
 Comparative statement analysis:

Under this form of comparative financial statements both the comparative Profit
and Loss Account and comparative Balance sheet are covered. Such comparative
statements are prepared not only to the comparison of the various figures of two or
more periods but also the relationship between various elements included in profit and
loss account and balance sheet. It enables to measure, operational efficiency and
financial soundness of the concern for analysis and interpretations. The following
information may be shown in the comparative statements:
(a) Figures are presented in the comparative statements side by side for two or more
years.
(b) Absolute data in money value.
(c) Increase or Decrease between the absolute figures in money value.
(d) Changes or trend in various figures in terms of percentage.

 Comparative income statement:
The income statement (profit or loss A/c) gives the results of the operations
during a definite period. It reveals the profit carried or loss incurred by the concern,
the comparative study of income statement for more than 1 year may enable us to
know the program of the concern.
In first step, find out the changes in absolute figures i.e.., increase or decrease should
be calculated.
In second step percentage of change should be calculated with the help of following
formula.
Percentage of change = change in amount/base year amount*100.
 Comparative balance sheet:

The balance sheet prepared on a particular date reveals the financial position of
the concern on the date to study, the trends of business over a period of time. Whereas
comparative balance sheet reveals the cause for changes in the financial position of
amount of various transactions. The comparative studies throw light on financial
policies adopted by management.
The comparative balance sheet consists of two columns for the original data. A
third column used to show increase or decrease in various items. A south column
containing the percentage of increase or decrease may be added.
NEED FOR THE STUDY
A comparative statement is a document that compares a particular
financial statement with its prior period statements. It show the financial condition of
business at a given point of time. The elements of financial position are shown in
comparative form so as to give an idea about two or more periods is as known in
comparative statements. Comparative statements not only shows the absolute figures
and exhibits changes in absolute figures of a company but also gives absolute data in
terms of percentages and change in percentages.
Rashtriya Ispat Nigam Limited is multi- product steel-

manufacturing unit with varying cycle time for each product. The capital required by
each department in a large organization like RINL depends on the product target for
that year. To understand this, conceptual idea is not only sufficient but also it needs a
wide knowledge and understanding of the factors that are affecting them.
OBJECTIVES OF THE STUDY
The objectives of the study are as follows:
 To study the profile of the Steel Industry.

 To study the profile of RASHTRIYA ISPAT NIGAM LIMITED.
 To study the conceptual framework of Comparative Statement Analysis.
 To analyze the profitability and solvency position of the company.
 To analyze the overall operations and performance of the firm efficiently.
 To suggest measures to the company to improve efficiency of the organization.

METHODOLOGY
Methodology is a systematic procedure of collecting information in order to

analyze and verify a phenomenon. The data can be collected through principle
sources.They are as follows:-
1. Primary sources &
2. Secondary sources.
1. Primary sources:
It is the information collected directly without any references. In this study it is

gathered through interviews concerned officers and staff either individually or
collectively, sum of the information has been verified or supplemented with personal
observation conducting personal interviews with the concerned officers of finance
department of Visakhapatnam steel plant.
2.Secondary sources:
This data is from the number of books and records of the company, the annual
reports published by the company and other magazines. The secondary data is
obtained from the following.
(a) Collection of the required data from annual records, internally published book or
profile of the Visakhapatnam Steel Plant.
(b) Reference from text books and journals and magazines relating to financial
performance and management.
(c) Annual Reports of the company.

LIMITATIONS OF THE STUDY
Though the project is completed successfully, there are few limitations they are:
• The period of study that is 4 weeks is not enough to go in the detailed aspects of
the study. So that time was the major constraint.
• The analysis and interpretation are based on secondary data contained in the
published annual reports of Vizag steel plant for the study. So that reliability on
secondary data is another limitation.
• Respondents may not provide accurate information due to various reasons.

CHAPTER-2
INDUSTRY PROFILE
 Introduction:
Steel is a widely used construction material across the world, and is itself actually
an alloy of iron and carbon. It also has manganese , silicon ,oxygen ,phosphorus ,and
sulphur in smaller amounts. The steel industry is the second largest one globally after
the oil and gas industry ,with an approximate turnover of $900billionUSD. In the U
S alone , the steel industry directly provides employment to an approximate
150,000people ,and indirectly supports the creation of more than one million jobs.
There are different types or grades of steel which are used for different purposes , such
as manufacturing cars, home appliances ,cargo ships ,surgical instruments
,construction products ,and many more. The metal has also found in important
applications in the aerospace and mining industries. Steel is crucial to the development
of any modern economy and is considered to be the backbone of human civilization.
The level of per capita consumption of steel is treated as an important index of the
level of socioeconomic development and living standards of the people in any country.
It is a product of a large and technologically complex industry having strong forward
and backward linkages in terms of material flows and income generation.
 Location:
Although a large number of countries are engaged in steel production , the
industry is largely concentrated in a hand full of countries which combine to produce
nearly75% of the world's steel. Those countries are the United States, China, India,
Russia, Japan and South Korea. Of these China was the largest exporter of steel in
2015, with over 100million tons of steel exports in the year. Other exporting large
quantities of steel were the European Union, Japan, the United
States ,India, South Korea ,and Russia .The US, Germany ,South Korea ,and Italy
are some of the top importers of steel. Some countries import steel on a large scale
despite being excellent in steel production themselves because of the high domestic
demands ,especially for those producing large arsenals of weapons for defense
purposes.
 Introduction of steel industry in India:
India was the world’s second largest steel producer, as of 2018. The country is
slated to surpass USA to become the world’s second largest steel consumer in 2019. In
FY18, India produced 104.98 million tons (MT) and 103.13 MT of finished steel and
crude steel, respectively. Crude steel production between April 2018-February
2019(P) reached
88.24 million tons.
India was also a net exporter of steel in FY18. Exports and imports of finished
steel stood at 5.77 MT and 7.13 MT respectively, during April 2018-February 2019
(P). Steel consumption is expected to grow 7.5 per cent year-on-year to 95.4 MT in
2018. India’s steel production is expected to increase from 103.13 MT in FY18 to
128.6 MT by 2021.
The Government has taken various steps to boost the sector including the
introduction of National Steel Policy 2017 and allowing 100 per cent Foreign Direct
Investment (FDI) in the steel sector under the automatic route. Between April 2000
and December 2018, inflow of US$
11.18 billion has been witnessed in the metallurgical industries as Foreign Direct
Investment (FDI).
India’s per capita consumption of steel grew to 68.9 kgs, during 2017-18.
National Steel Policy 2017 aims to increase the per capita steel consumption to 160 kg
by 2030-31.
India was the world’s fifth major producer of crude steel in 2009. The steel
industry plays a vital role in the growth of nation’s economy.Steel industry is the
backbone of all industrial commercial activities and plays a vital role in the growth of
nation’s economy. Steel is an alloy of iron usually containing less than 1%carbon.
Steel is such a versatile commodity that every object we see in our day to day life has
used steel either directly or indirectly in its product.
According to the Ministry of the Steel, India remains world’s largest
producer of the sponge iron. This provide major cost advantage to the domestic steel
sector, with companies like Tata Steel being one of the lowest cost producers in the
world.
All major industrial economies are characterized by the existence of a strong
steel industry and the growth of many of these economies has been largely shaped by
the strength of their steel industries in their initial stages of development. Steel
industry was in the vanguard in the liberalization of the industrial Sector and has made
rapid strides since then. The new Greenfield plants represent the latest in technology.
Output has increased, the industry has moved up i n the value chain and exports have
raised consequent to a greater integration with the global economy. The new plants
have also brought about a greater regional dispersion easing the domestic supply
position notably in the western region. At the same time, the domestic steel industry
faces new challenges. Some of these relate to the trade barriers in developed markets
and certain structural problems of the domestic industry notably due to the high cost
of commissioning of new projects. The domestic demand too has not improved to
significant levels. The litmus test of the steel industry will be to surmount these
difficulties and remain globally competitive.
 INDUSTRY SCENARIO:
 Global Scenario:
 In 2016, the world crude steel production reached 1630 million tons (mt) and showed
a growth of 0.6% over 2015.
 China remained world’s largest crude steel producer in 2016 (808 mt) followed by
Japan (105 mt), India (96 mt) and the USA (79 mt).
 World Steel Association has projected Indian steel demand to grow by 6.1% in 2017
and by 7.1% in 2018 while globally, steel demand has been projected to grow by
1.3% in 2017 and by 0.9% in 2018. Chinese steel use is projected to show nil
growth in 2017 and decline by 2% in 2018.
 Per capita finished steel consumption in 2016 is placed at 208 kg for world and 493
kg for China by World Steel Association. Note: Data for the year 2016 is
provisional.
 Domestic Scenario:
 The Indian steel industry has entered into a new development stage, post de-
regulation, riding high on the resurgent economy and rising demand for steel.
 Rapid rise in production has resulted in India becoming the 3rd largest producer of
crude steel in 2015 as well as in 2016. The country was the largest producer of
sponge iron or DRI in the world during the period
2003-2015 and emerged as the 2nd largest global producer of DRI in 2016 (after
Iran). India is also the 3rd largest finished steel consumer in the world and
maintained this status in 2016. Such rankings are based on provisional data
released by the World Steel Association for the above year.
 The Government has released the National Steel Policy 2017, which has laid down
the broad roadmap for encouraging long term growth for the Indian steel industry,
both on demand and supply sides, by 2030-31.
 The said Policy is an updated version of National Steel Policy 2005 which was
released earlier and provided a long-term growth perspective for the domestic iron
and steel industry by 2019-2020.
 The Government has also announced a policy for providing preference to
domestically manufactured Iron & Steel products in Government procurement.
This policy seeks to accomplish PM’s vision of ‘Make in India’ with objective of
nation building and encourage domestic manufacturing and is applicable on all
government tenders where price bid is yet to be opened. Further, the Policy
provides a minimum value addition of 15% in notified steel products which are
covered under preferential procurement. In order to provide flexibility, Ministry of
Steel may review specified steel products and the minimum value addition
criterion.
 The Major Steel And Related Companies In India:
1. Bharat Refectories Ltd.
2. Hindustan Steel Works Construction Ltd.
3. Jindal Steel and Power Ltd.
4. Kudremukh Iron Ore Company Ltd.
5. Manganese ore (India) Ltd.
6. Metal Scrap Trade Corporation Ltd.
7. Metallurgical and Engineering Consultants India Ltd.
8. National Mineral Development Corporation (NMDC).
9. Rashtriya Ispat Nigam Ltd.
10.Sponge Iron India Ltd. 11.Steel
Authority India Ltd. 12.Tata Iron
Steel Company.
 Objective Of Steel Policy:

Strategic Goal: The long-term goal of the national steel policy is that India should
have a modern and efficient steel industry of world standards, catering to
diversified steel demand. The focus of the policy would therefore be to achieve
global competitiveness not only in terms of cost, Quality and product-mix but also
in terms of global benchmarks of efficiency and productivity. This will require
indigenous production of over 100 million tonnes (MT) per annum by 2019-20
from the 2004-05 level of 38 MT. This implies a compounded annual growth of
7.3 percent per annum.
 Industry Structure:
The iron and steel industry in India is organized in three categories‟
viz. main producers, other major producers and the secondary producers. The main
producers and other major producers have integrated steel making facility with
plant capacities over 0.5 MT and utilize iron ore and coal/gas for production of
steel. In 2004-05, the main producers i.e. SAIL, TISCO and RINL had a combined
capacity of around 19.3 MT and capacity utilization was
104 percent. The other major producers comprising of ESSAR, ISPAT and JVSL
had a capacity of 6.4MT with capacity utilization of 97 percent. The secondary
sector is dispersed and consists of:
(a) Backward linkage from about 120 sponge iron producers that use iron ore
and non- coking coal, with a capacity of around 13 MT,
providing feedstock for steel producers. The capacity utilization in
2004-05 was 75 percent.
(b) About 650 mini blast furnaces, electric arc furnaces, induction furnaces and
energy optimizing furnaces that use iron ore, sponge iron and melting scrap
to produce steel. Their capacity is around 14.7 MT, and capacity utilization
in 2004-05 was 58 percent.
(c) Forward linkage with about 1,200 re-rollers that roll out semis into finished
steel products for consumer use. These are small and medium enterprises,
whose reported capacity is around 15 MT, and capacity utilization in 2004-
05 was 55 percent.
 Swot Analysis Of The Industry:
The strengths, weaknesses, opportunities and threats for the Indian steel
industry have been tabulated below. The national steel policy lays down the broad
roadmap to deal with all of them.
Strengths Weaknesses
1. Availability of iron ore 1. Unscientific mining
and coal 2. Low productivity
2. Low labour wage rates
3. Abundance of Quality 3. Coking coal import
manpower dependence
Opportunities Threats
1. Unexplored rural market 1. China becoming net exporter
2. Growing domestic 2. Protectionism in the West
demand
3. Dumping by competitors
3. Exports
 Strengths
India has rich mineral resources. It has abundance of iron ore, coal and many other
raw materials required for iron and steel making. It has the fourth largest iron ore
reserves (10.3 billion) after Russia, Brazil, and Australia. Therefore, many raw
materials are available at comparatively lower costs. It has the third largest pool of
technical manpower, next to United States and the erstwhile USSR, capable of
understanding and assimilating new technologies. Considering Quality of
workforce, Indian steel industry has low unit labour cost, commensurate with skill.
This gets reflected in the lower production cost of steel in
India compared to many advanced countries (Table 3). With such strength of
resources, along with vast domestic untapped market, Indian steel industry has the
potential to face challenges successfully.
 Weaknesses
 Endemic Deficiencies: These are inherent in the Quality and availability of
some of the essential raw materials available in India, eg, high
ash content of indigenous coking coal adversely affecting the productive
efficiency of iron-making and is generally imported. Advantages of high Fe
content of indigenous are often neutralized by high basicity index. Besides,
certain key ingredients of steel making, eg, nickel, ferro
-molybdenum is also unavailable indigenously. Systemic Deficiencies However,
most of the weaknesses of the Indian steel industry can be classified as systemic
deficiencies. Some of these are described here. High Cost of Capital Steel is a
capital intensive industry; steel companies in India are charged an interest rate of
around 14% on capital as compared to 2.4% in Japan and 6.4% in USA. Low
labor Productivity In India the advantages of cheap labour gets offset by
low labour productivity; eg, at comparable capacities labour productivity of SAIL
and TISCO is 75 t/man year and 100 t/man year, for POSCO, Korea and NIPPON,
Japan the values are 1345 t/man year and 980 t/man year. High Cost of Basic
Inputs and Services High administered price of essential inputs like electricity
puts Indian steel industry at a disadvantage; about
45% of the input costs can be attributed to the administered costs of coal, fuel and
electricity, eg, cost of electricity is 3 cents in the USA as compared to 10 cents in
India; and freight cost from Jamshedpur to
Mumbai is $50/ton compared to only $34 from Rotterdam to Mumbai. Added to this
are poor Quality and ever increasing prices of coking and non-coking coal.
Other systemic
deficiencies include:
 Poor Quality of basic infrastructure like road, port etc.

 Lack of expenditure in research and development.
 Delay in absorption in technology by existing units.
 Low Quality of steel and steel products
 Lack of facilities to produce various shapes and qualities of finished steel on-
demand such as steel for automobile sector, parallel flange light weight
beams, coated sheets etc.
Besides these Indian steel makers also lacked in international
competitiveness on determinants like product Quality, product design, on-
time delivery, post sales service, distribution network, managerial initiatives,
research and development, information technology and labor productivity etc.
As is evident in Table 4, the weaknesses gets reflected in India’s poor standing
in the global competitiveness as measured in terms of indicated parameters.
 Opportunities
The biggest opportunity before Indian steel sector is that there is
enormous scope for increasing consumption of steel in almost all sectors in India.
Table 6 gives a glimpse of untapped potential of increasing steel consumption in
India; eg, even to reach the comparable developing and lately developed
economies like China and other
Europe, a quantum jump in steel consumption will be required.
 Unexplored Rural Market

The Indian rural sector remains fairly unexposed to their multi-faced
use of steel. The rural market was identified as a potential area of significant steel
consumption way back in the year 1976 itself. However, forceful steps were not
taken to penetrate this segment. Enhancing applications in rural areas assumes a
much greater significance now for increasing per capital consumption of steel. The
usage of steel in cost effective manner is possible in the area of housing, fencing,
structures and other possible applications where steel can substitute other materials
which not only could bring about advantages to users but is also desirable for
conservation of forest resources. Other Sectors Excellent potential exist for
enhancing steel consumption in other sectors such as automobiles, packaging,
engineering Industries, irrigation and water supply in India. New steel products
developed to improve performance simplify manufacturing/installation and
reliability is needed to enhance steel consumption in
these sectors. Main objective here have to be improvement of Quality for value
addition in use, requirement of less material by reducing the weight and thickness
and finally reduction in overall co st fo r the en d user. Latest tech nol ogy
must be adopted by Indian steel manufacturers for production of superior
Quality of steel for these applications. For example, pre-coated sheets can be used
in manufacture of appliances, furnishings, electric goods and public transport
vehicles. Production and supply of superior grades of steel in desired shapes and
sizes will definitely increase the steel consumption as this will reduce fabrication
need; thereby reduce cost of using steel. Few other perceived opportunities are:
Export Market Penetration It is
estimated that world steel consumption will double in next 25 years. Quality
improvement of Indian steel combined with its low cost advantages will definitely
help in substantial gain in export market.
 Threats
 Slow Industry Growth
The linkage between the economic growth of a country and the growth
of its steel industry is strong. The Indian steel industry is no exception. The growth
of the domestic steel industry between 1970 and 1990 was similar to the growth of
the economy, which as a whole was sluggish. This sluggish growth in the steel
industry has resulted in enhanced rivalry among existing firms. As the industry is
not growing the only other way to grow is by increasing one’s market share.
Consequently, the Indian steel industry has witnessed spurts of price wars and heavy
trade discounts, which has done Indian steel industry no good as a whole. Threat
of Substitutes Plastics and composites pose a threat to Indian steel in one of its
biggest markets. For the automobile industry, the other material at present with the
potential to upstage steel is aluminum. However, at present the high cost of
electricity for extraction and purification of aluminum in India weighs
against viable use of aluminum for the automobile industry. Steel has already
been replaced in some large volume applications: railway sleepers (RCC sleepers),
large diameter water pipes (RCC pipes), small diameter pipes (PVC pipes), and
domestic water tanks (PVC tanks).
 Technological Change
Technological changes often force the industry structure to change. For a
developing country like India where capital itself is costly, technological
obsolescence is a major threat. Price Sensitivity and Demand Volatility The demand
for steel is a derived demand and the purchase quantity depends on the end-user
requirements. The traders discounts. This volatility of demand often affects the
integrated steel manufacturers because of their inability to tune their production in
line with the market demand Fluctuations. Some other threats are:
 Ever decreasing import duty on steel.
 Dumping of steel by developed countries.
 High Quality products from developed countries
available for import at very competitive prices.
 Non-availability of capital from financial institutions for iron and steel sector.
 Government Initiatives:
In order to provide accelerated thrust on R&D, Ministry of Steel is

encouraging Research and Development activities both in public and private steel
sectors by providing financial assistance under the following two schemes:
(A) R & D with Steel Development Fund (SDF):

Under this scheme, 73 R&D projects have been approved since
inception with total project cost of Rs.599.63crores with SDF assistance of
Rs.316.41crore. Sinceinception,Rs.155.60crore has been disbursed from SDF on
completed and on going R&D projects. So far, 40 projects have been completed and
the results of some of them have been
found positive and already implemented in the Industry in improvement in
productivity, reduction in energy consumption and pollution etc.
(B) R&D with Government Budgetary Support (GBS):

8 R&D projects have so far been approved with in the a fore said
3broad areas with a total cost of Rs.123.27crores involving Plan Fund of
Rs.87.28crores. Major projects are covered under this scheme include exclusive R&D
initiatives to upgrade Indian low grade iron (including BHQ/BHJ) and Indian
coking/non-coking coal. Presently, these projects are at the preliminary stage of Work
but when completed, and if results are successful these may go a long way in making
available high quality inputs from lean ore/coal for the iron/steel industry.
 Industry Information
 Steel Demand:
 Urban Areas: The present steel consumption per capita per annum is about 30
kg in India, compared to 150 kg in the world, and 350 kg in the developed
world. The estimated urban consumption per capita per annum is around 77 kg
in the country, expected to reach approximately 165kg in 2019-20, implying a
CAGR of 5 percent. Apart from the anticipated growth in the construction,
automobile, oil and gas transportation, and infrastructure sectors of the
economy, conscious promotion of steel usage among architects, engineers and
students by the institute of Steel Development and Growth (INSDAG) and the
large producers will drive this additional consumption. Steps would be taken to
encourage usage of steel in bridges, crash barriers, flyovers and building
construction. Benefits of steel usage would be added to the technical education
curricula in the country.
 Rural Areas: The rural consumption of steel in India remains at around 2 kg
per capita per annum, primarily because steel is perceived to be expensive
among the village folks. Based on the promotional efforts mentioned above,
and an active focus on opening new block level rural stock points, a target is
set for raising the per capita rural consumption of steel to 4 kg per annum by
2019-20, implying a CAGR of 4.4 percent.
 Exports: Although the focus of Indian steel industry is on the domestic

market, export will be another window on the demand side. The growth of
exports of steel from India has been around 10 percent per annum over the
past decade. That speaks for the international cost competitiveness of the steel
sector. It takes assiduous effort to create, and hold on to export markets.
While the business decision to export will depend on the prevailing relative
prices, the Government would encourage strategic alliances with buyback
arrangements and dedicated export production through 100% export-oriented
units. A growth rate of around 13 percent per annum is envisaged up to 2019-
20. The issues related to exports have been discussed in section 13 on Trade
Policy.
CHAPTER-3
COMPANY PROFILE
RASHTRIYA ISPAT NIGAM LIMITED
 INTRODUCTION:
RASHTIRYA ISPAT NIGAM LTD a Navratna PSE, is the corporate entity of

Visakhapatnam steel plant the country’s first shore based integrated steel Plant at
Visakhapatnam, Andhra Pradesh, set up with a capacity of 3.0Mtpa of liquid steel,
started production from its 6.3Mtpa Expansion facilities. It is the only seacoast based,
integrated steel plant in the country. To meet the growing domestic needs of steel,
Government of India decided to set up an integrated steel plant at Visakhapatnam. The
decision to establish the Visakhapatnam Steel Plant was announced in parliament in
1970 by the late Prime Minister, Mrs. Indira Gandhi. The foundation stone for this
massive project was laid in 1971 and a Detailed Project Report (DPR) was prepared in
1977. The Project has got the approval from the Government of India in 1979. An
agreement was signed with erstwhile USSR in 1979 for co operation in setting up 3..4
Mtpa integrated steel plant at Visakhapatnam.
The completion of construction and commissioning of the whole plant in 1992, the cost
escalated to around 8500 cores. It is the modern steel plant in the country. The plant
was dedicated to the nation on 1st August, 1992 by the Prime Minister, Sri P.V.
Narasimha Rao.
VSP conferred “MINI RATNA” status in the year 2006 and was
attained “NAVA RATNA” status in the year 2010.
 Modern Technology:
In Visakhapatnam Steel Plant modern technology has been adopted in
many areas of production, some of them for the first time in the country.
 Selective crushing of coal.
 7 meter tall coke ovens.
 Dry quenching of coke.
 On ground blending of sinter base mix.
 Conveyor charging and bell less top for blast furnace.
 100% continuous casting of liquid steel.
 Computerization for process control.
 Sophisticated high speed and high production rolling mills.

 Raw Material Linkages:
VSP obtains its raw materials both from the country as well as Imports.
Major sources of raw materials are;
Iron ore lumps & fines Biladilla Chhattisgarh.
Bf lime stone Jaggayyapeta, A.P.
SMS lime stone UAE
BF dolomite Madharam, A.P.
SMS dolomite Madharam, A.P.
Manganese ore Chipurupalli, A.P.

Boiler coal Talcher, Orissa
Coking Coal Australia/US
Medium coking coal Kathara / Swang / Raja Rappa / Kedla
Imported boiler coal Indonesia
Imported lam coke China
Quartizite lump & fines local
Sand Sarepalli, A.P.
 Products Of VSP:
Production at VSP comprises mainly of long steel products, such as plain wire
rods, rebar, rounds, structural and semi-finished steel products, such as billets and
blooms. The products are made with 100percent virgin steel, and we have adopted
modernized technology to help improve product quality.
BY PRODUCTS
STEEL PRODUCTS
Angels Rounds Nuts coke Toluene
Billets Flats Coke dust Wash oil
Channels Re-bars Coal tar Granulated slag
Beams Wire rods Anthracene oil Lime fines
Squares HP Naphthalene Ammonium

sulphate
Benzene
 Water Supply:
Requirement of water during the peak of construction was of the order
of 4.5 Mgd. This was met from the Meghadrigedda, and Raiwada schemes of
Andhra Pradesh state government. Operational water requirements 70Mgd of the
steel plant are being met from the Yeleru water supply scheme provided by the AP
government.
 Power Supply:
Operation power requirement of 180 to 200 MW is being met through Captive Power
Plant. The capacity of the power is 286.5 MW. Now Power Plant-II ready for
operation having capacity of VSP is exporting around 60 MW power to APSEB.
VISION &MISSION:
VISION:
 To be the most efficient steel maker having the largest single location shore based
Steel Plant in the country.
 Achieve excellence in enterprise management.
 Deliver high quality and cost competitive products and be the first choice of
customers.
 Create an inspiring work environment to unleash the creative energy of people.
MISSION:
To attain 20 million tons (Mt) liquid steel capacity through technological

up-gradation, operational efficiency and expansion, augmentation of assured supply of
raw material, to produce steel at International Standards of cost and quality; and to
meet the aspirations of the stakeholders.
OBJECTIVES:
 Achieve Gross Margin to Turnover ratio > 10%.

 Plan for finishing mill to integrate with 7.3 Mt capacity and commission the
same by 2017-18.
 Achieve rated capacity of new & revamped units by 2017-18.
 Capture markets for high-end value added products by focusing on sector
specific applications and customer needs.
 Achieve leadership in Energy consumption by achieving 5.6 Gcal/tcs by 2017-
18.
 Diversify through operationalising of Bhilwara Mines, setting up of
Pelletization plant, DRI-EAF (Direct Reduced Iron in Electric Arc Furnace)
unit, Wheel & Axle Plants.
 Create a high performance and safe work culture by nurturing talent and
developing leaders.
 To grow in harmony with the environment & communities around us.
CORE VALUES:
I Initiative : Have a self-propelled & proactive approach D
Decisiveness : Decide with speed & clarity
E Ethics : Be consistent with professional & moral values A
Accountability : Take responsibility for actions
L Leadership : Lead by example
S Speed : Demonstrate swiftness and efficiency in
everything we do.
 Number Of Employees:
In VSP there are 18,000 employees in that 12000 employees are Non-
Executive and remaining are Executives. In Gender Diversity there are 97% men, and
3% women.
 HUMAN RESOURCE MANAGEMENT:

Human resource initiatives at VSP are closely linked to the corporate
strategy of the organization. VSP has harmonious industrial relations where the entire
workforce works as a well-knit team for the progress of the company. The productive
environment prevailing in the company fosters an atmosphere of growth -- both for the
employees and for the company. VSP has introduced multi-skill concept since
inception and the employees are trained to imbibe this. VSP has adopted a system of
over-lapping shifts -- the first of its kind, in the industry. This system ensures smooth
change-over of the shifts and uninterrupted pace of operation of the plant during the
shift-change over. Another unique feature followed at VSP is the uniform working
hours for the ministerial and non-ministerial employees. The labor productivity has
crossed 414 tons/man/year – unparalleled in the Public Sector Steel Industry.
PRODUCTION DEPARTMENTS
 Various Departments Of VSP: There are 75 departments in Visakhapatnam steel

plant some of the major departments are such as
 Coke oven
 Sinter plant
 Steel melt shop
 Continuous casting
 Rolling mills
 Light &Medium Merchant Mills
 Wire Rod Mill
 Blast furnace



 Sinter Plant:
Sinter is a hard & porous ferrous material obtained by agglomeration of Iron

Ore fines, Coke breeze, Lime Stone fines, Metallurgical wastes viz. Flue dust, mill
scale, LD slag etc., Sinter is a better feed material to Blast Furnace in comparison to
Iron Ore lumps and its usage in Blast furnaces help in increasing productivity,
decreasing the coke rate & improving the quality of Hot Metal produced. Hot Sinter
discharged from Sintering machine is crushed to +5 mm – 50 mm size and cooled
before dispatching to Blast Furnaces.
 Coke Ovens & Coal Chemical Plant (CO & CCP):
Blast Furnaces, the mother units of any Steel plant require huge
quantities of strong, hard and porous solid fuel in the form of hard metallurgical coke
for supplying necessary heat for carrying out the reduction and refining reactions
besides acting as a reducing agent. At VSP there are three Coke Oven Batteries, 7
Meter tall and having 67 Ovens each. Each oven in having a volume of 41.6 cu.
Meter & can hold up to 31.6 tones of dry coal charge. There are 3 Coke Dry Cooling
Plants (CDCP) each having 4 cooling chambers. Nitrogen gas is used as the Cooling
medium. The heat recovery from nitrogen is done by generating steam and expanding
in two backpressure turbines to produceMW each. The Coal chemicals such as
Benzole (& its products), Tar (& its products), and Ammonium Sulphate etc., are
extracted in Coal Chemical Plant from C.O. Gas. After recovering the Coal chemicals
the gas is used as a by – product fuel by mixing it with gases such as BF gas, LD Gas
etc.A mechanical, biological &Chemical treatment plant takes care of the effluents
 Steel Melt Shop:
VSP produces steel employing three numbers of top blow Oxygen

Converters called LD converters or Basic Oxygen Furnaces / Converters. Each
converter is of 133 cu. Meter volume, rated to produce 3 Million tones of Liquid steel
annually. Besides Hot Metal Steel Scrap, Fluxes such as calcined lime or Dolomite
from part of charges to the converters.’ Different grades of steel of Superior quality
can be made by this process by controlling the oxygen blow or addition of various
Ferro alloys or special additives such as Coke Breeze, Aluminum etc., in required
quantities while liquid steel is being tapped from the converter into a steel ladle.
Converter / LD gas produced as by product is used as a secondary fuel.
 Continuous Casting Department:
VSP has six – 4 strand continuous casting machines capable of

producing 2.82 million Tonnes / year Blooms of size 250 x 250 mm and 250 x 320
mm.. Entire quantity of molten steel produced ( 100% ) is continuously cast in radial
bloom casters which help in energy conservation as well as production of superior
quality products. Facilities at continuous casting machines include a lift and Turn table
for ladles, Copper mould, oscillating system tundish Primary & Secondary Cooling
arrangement to cool the steel bloom. Gas cutting machines for cutting the bloom in
required lengths ( Av. 6 meters long )
 Rolling Mill:
Blooms produced in SMS – CCD are shaped into products such as Billets,
rounds, squares, angles (equal & Unequal), Channels, I- PE Beams, HE Beams, Wire
rods and reinforcements bars by rolling them in three sophisticated high capacity, high
speed, fully automated rolling mills, namely Light & Medium Merchant Mills
(LMMM), Wire Rod Mill ( WRM ) and Medium Merchant and Structural Mill
(MMSM).
 Light & Medium Merchant Mills (LMMM):
LMMM comprises of two units. In the Billet / Break down mill 250 x 320
mm size blooms are rolled into Billets of 125 x 125 mm size. Billets are supplied from
this mill to bar Mill of LMMM & Wire Road Mill. The Bar mill is facilitated with
temp core heat treatment technology evaporative cooling system in walking beam
furnaces, automated pilling & bundling facilities, high degree of automation and
computerization. The mill is deisgned to produce 710,000 tons per annum of various
finished products such as rounds, rebars, and squares, flats, angles, and channels
besides billets for sale.
 Wire Rod Mill (WRM):
Wire Rod Mill is fully automated & sophisticated mill. The billets are
rolled in 4 strand, high – speed continuous mill having a capacity of 8,50,000Tonnes
of Wire Rod Coils. The mill rounds in 5.5 – 14 mm range and rebars in 8, 10 & 12 mm
sizes. The mill is equipped with standard and Retarded Stelmore controlled cooling
lines for producing high quality Wire rods in Low, Medium & High carbon grade
meeting the stringent national & International standards viz. BIS, DIN, JIS, BS etc.,
and having high ductility, uniform grain size, excellent surface finish.
 Marketing Network:
The company markets its products through headquarter marketing office and
of network of 5 regional offices,23 branch offices and stockyards located all over the
country. It also takes the help of consignment agents and consignment sales for the
marketing of its products. The exports are carried out by the export wing of marketing
division with the help of different agencies. The company is recognized as “Star
Trading House” by the director general of foreign trade, ministry of commerce,
government of India.
The end users of the steel products manufactured at the plant include amongst
others, construction industry, engineering industry, re-rolling industry, wire drawing
industry, fastener industry, electrode manufacturers and railways. The company is
ideally located to serve the southern Indian market. Regional managers/branch
managers meet at head quarters regularly to access the market situation and market
strategies.
Marketing Department of VSP has successfully entered into International

markets from the year of its integrated operations i.e.,1992. From the second year of
integrated operations i.e.,1993-94. This status is given to those companies, which
maintains a specific quality of exports in the preceding 3 years. Subsequently, the
certificate has been renewed till 31-3-2009. As a strategy, the company maintaining its
presence in the Export Market.
In order to get twin advantages of tapping the potential for steel
consumption in the rural areas and increasing the customer base, RINL, VSP has
started the system of appointing District Level Dealers (DLDs) for distributing steel in
the rural markets from 2004-05. Phase
wise implementation of this scheme is planned. Till the end of 2007-08 , 139 DLDs
have been appointed. Almost all the districts, where RINLs branch office or CSAs are
not there in the southern states and the neighboring states Orissa, Chhattisgarh and
Maharashtra, the company had appointed DLDs.
 Channels Of Distribution:
(a) RINL has a network of 21 branches and stockyard all over India.
(b) Regional managers/branch manager meet at Head Quarters regularly to assess
the market situation and evolve suitable market strategies.
(c) Consignment agencies/consignment sales agencies/dealers.
(d) The customer of VSP fall under the following major categories :-
1. Profit sales
2. Engineering industry
3. Reenrolling industry
4. Traders
5. Exports
(e) RINL has well-laid internal rail tracks within the plant facilitating easy
movement of materials. The finished goods are mainly transported by road and
exports by ship. The rail transportation has been reduced considerably due to
in freight charge.
VSP – POLICIES
VSP takes all necessary actions for the fulfillment of regulatory
requirements has dedicated departments for this purpose. Energy conservation,
environmental conservation, safety in work place, and occupational health gets highest
priority in the company. Some of the policies in this regard are reproduced below.
 Quality Policy:
RINL is committed to meet the needs and expectation of our customers and others
interested parties. To accomplish this, RINL does
 Supply quality goods and services to customer’s delight.
 Achieve quality of the products by following systematic approach through
planning, documented procedure and timely review of quality objectives.
 Continuously improve the quality of all materials, processes and products.
 Use resources efficiently and reduce waste & prevent pollution.
 Encourage development and involvement of employees.
 Environment Policy:
We at Visakhapatnam steel plant, while carrying out its operations
reaffirm our commitment to preserve the environment. To accomplish this, they will-
 Document, implement, maintain and continuously review the
environmental management system.
 Comply with all the relevant environmental legislations, regulations, and
prevention of pollution by minimizing the emission and
discharge.
 Energy Policy:
We, at Visakhapatnam steel plant, are committed to optimally utilize

various forms of energy in a cost effective manner to effect conservation of energy
resources. To accomplish this, we will –
 Monitor closely and control consumption of various forms of energy through
an effective energy management system.
 Adopt appropriate energy conservation technologies.
 Maximize the use of cheaper and easily available forms of energy.
 Hr Policy:
We, at Visakhapatnam steel plant, believe that our employees are the most
important resources. To realize the full potential of employees, the company is
committed to:
 Promote a learning &Development eco system.

 Adapt a Fair & Transparent mechanism to ensure proper governance
across the organization.
 Reinforce consistent efforts to enhance the motivational levels of all
employees.
 Kindle creativity Innovation by providing opportunities for achieving
higher level of Excellence.
 Lead to achieve High Performance
 Enliven a Healthy and safe work culture by following the best.
 Customer Policy:
 VSP will endeavor to adopt a customer – focused approach at all times with
transparency.
 VSP will strive to meet more than the customer needs and expectations pertaining
to products, Quality, and value for money and satisfaction.
 Swot Analysis Of Visakhapatnam Steel Plant:-
 STRENGTHS:
 Abundance of iron ore and coal
 3rd largest pool of technical manpower
 Low cost and efficient labor force
 Strong managerial capability
 Strongly globalized industry and emerging global competitiveness
 Modern new plants & modernized old plants
 Strong DRI production base
 Regionally dispersed merchant rolling mills
 WEAKNESS:
 Low R&D investments
 High cost of energy
 Dependence on imports for steel manufacturing equipment’s & technology
 Slow statutory clearances for development of mines
 Lack of level playing field with others due to lack of captive iron ore & coking
coalmines.
 Due for Major capital repairs and modernization
 Steep rise in Cost of production and fall in margins
 High cost of servicing huge equity.
 Subdued international & sluggish domestic Market
 OPPORTUNITIES:
 Unexplored rural market
 Export market penetration
 Rapid urbanization
 Increasing demand for consumer durables
 Increasing interest of foreign steel producers in India
 Huge demand potential in view of the projected growth.
 Encouraging signs due to huge infrastructure spend planned in 12th Five Year
Plan. Projected growth in Steel consumption.
 Improved availability of Ports & logistics.
 Diversifying to new product mix like Axles and Transmission line towards etc.
 THREATS:
 Slow industrial growth
 Threats of substitute
 Technological change Price sensitivity and demand volatility
 Slow growth in infrastructure development
 Stiff competition further compounded by capacity expansion by competitors and
entry of International players.
 Price cut by Competitors.
 Increasing raw material prices & shift of value chain towards raw materials.
 Competitors Of RINL:
JSW
TATA STEEL LTD.
JINDAL STEEL LTD.
ESSAR STEEL
SAIL
ELECTRO STEEL LTD. BHUSAN
STEEL LTD.
 Statistical Information:
FINANCIAL PERFORMANCE (Rs. Crs.)
YEAR GROSS NET PROFIT

2013-14 1159 366
2014-15 809 62
2015-16 (790) (1420)
2016-17 (263.89) (1236)
2017-18 346.19 (1369)
CHAPTER-4
CONCEPTUAL PROFILE
FINANCIAL STATEMENT ANALYSIS
 Introduction
Every business concern wants to know the various financial
aspects for effective decision making. The preparation of financial statement
is required in order to achieve the objectives of the firm as a whole. The
term financial statement refers to an organized collection of data on the
basis of accounting principals and conventions to disclose its financial
information.
Definition :
According to john N.MYER “The financial statements provide a

summary of the accounts of a business enterprise , the balance sheet
reflecting the assets , liabilities and capital as on a certain date and the
income statement showing the results of operations during a certain period.
 The income statement (Trading, Profit and Loss Account )
 The balance sheet .
 A statement of retained earning earring .
 A statement of changes in financial position .
 Methods Or Tools Of Analysis And Interpretations:

The following are the various techniques can be adopted for the analysis and
interpretations of financial statements.
(1) Comparative Financial Statements.
(2) Common Size Statements.
(3) Trend Analysis.
(4) Ratio Analysis.
(5) Fund Flow Analysis.
(6) Cash Flow Analysis.
 Comparative Financial Statements:

Under this form of comparative financial statements both the
comparative Profit and Loss Account and comparative Balance sheet are covered.
Such comparative statements are prepared not only to the comparison of the various
figures of two or more periods but also the relationship between various elements
embodied in profit and loss account and balance sheet. It enables to measure
operational efficiency and financial soundness of the concern for analysis and
interpretations. It is a tool of financial analysis used to study the magnitude and
direction of changes in the financial position and performance of a firm over a period
of time. The preparation of comparative statements is based on the premise that a
statement covering a period of a number of years is more meaningful and significant
than for a single year only.
The comparative financial statements are statements of the financial position
at different periods; of time. The elements of financial position are shown in a
comparative form so as to give an idea of financial position at two or more periods.
Any statement prepared in a comparative form will be covered in comparative
statements. From practical point of view, generally, two financial statements (balance
sheet and income statement) are prepared in comparative form for financial analysis
purposes. Not only the comparison of the figures of two periods but also be
relationship between balance sheet and income statement enables an in depth study of
financial position and operative results.
THE COMPARATIVE STATEMENT MAY SHOW :
(i) Absolute figures (rupee amounts).

(ii) Changes in absolute figures i.e., increase or decrease in absolute figures.
(iii) Absolute data in terms of percentages.
(iv) Increase or decrease in terms of percentages.
(v) Comparisons expressed in terms of ratios.
(vi) Percentage of totals.
 Objectives Or Purpose Of Comparative Financial Statements:

The analyst is able to draw useful conclusions when figures are
given in a comparative position. The figures of sales for a quarter, half -year or one
year may tell only the present position of sales efforts. When sales figures of previous
periods are given along with the figures of current period then the analyst will be able
to study the trends of sales over different periods of time. Similarly, comparative
figures will indicate the trend and direction of financial position and operating results.
The important objectives of comparative financial statements are as under :
(i) To indicate the trend and direction of financial position and operating results.
(ii)To judge the strengths and weaknesses of a firm in terms of liquidity, solvency and
profitability.
(iii)To help the management in planning and forecasting.

(iv) To indicate the magnitude and direction of changes in various elements of
financial statements.
(v) To enhance the usefulness of financial reports.
The financial data will be comparative only when same accounting principles are used
in preparing these statements. In case of any deviation in the use of accounting
principles this fact must be mentioned at the foot of financial statements and the
analyst should be careful in using these statements.
The two comparative statements are

(i)Balance sheet, and
(ii) Income statement.
 Comparative Income Statements:
The income statement (profit or loss A/c) gives the results of the
operations during a definite period. It reveals the profit carried or loss incurred by the
cancers. The comparative study if income statement for more than 1 year may enable
us to know the program of the concern .The income statement gives the results of the
operations of a business. It shows the net profit or net loss on account of business
operations. The comparative income statement gives an idea of the progress of a
business over a period of time. The changes in absolute data in money values and
percentages can be
determined to analyze the profitability of the business.
 Objectives Of Comparative Income Statement:

The important objectives of preparing a comparative income statement are
as follows :
(i) To analyze and evaluate the operating results of a business.
(ii) To indicate the trend and direction of incomes and expenditures in terms of
absolute money values and percentages.
(iii) To enhance the usefulness of an income statement.
(iv) To help the management in planning and forecasting the profits.
 Procedure For Preparing A Comparative Income Statement :

A comparative Income statement, like I comparative balance sheet contains
the following columns:
a. Particulars columns.
b. Data of previous period/year‘s statement of profit and loss.
c. Data of current period/year’s statement of profit and loss.

d. Increase or decrease in the absolute data.
e. Percentage change of increase or decrease.
 Guidelines For Interpretation Of Income Statements:
(1) The increase or decrease in sales should be compared with the increase or
decrease in cost of goods sold. An increase in sales will not always mean an increase
in profit. The profitability will improve if the sales is more than the increase in cost of
goods sold. The amount of gross profit should be studied in the first step.
(2) The second step of analysis should be the study of operational profits. The
operating expenses such as office and administrative expenses, selling and distribution
expenses should be deducted from gross profit to find out operating profits. An
increase in operating profit will result from the increase in sales position and control
of operating expenses. A decrease in operating profit may be due to an increase in
operating expenses or decrease in sales. The change in individual expenses should also
be studied. Some expenses may increase due to the expansion of business activities
while others may go up due to managerial inefficiency.
(3)The increase or decrease in net profit will give an idea about the overall
profitability of the concern. Non-operating expenses such as interest paid, losses from
sale of assets, writing off of deferred expenses, payment of tax, etc. decrease the
figure of operating profit. When all non-operating expenses are deducted from
operational profit, we get a figure of net profit. Some non- operating incomes may
also be there which will increase net profit. An increase in net profit will give us an
idea about the progress of the concern
(4) An opinion should be formed about profitability of the concern and it should be
given at the end. It should be mentioned whether the overall profitability is good or
not.
FORMAT
 Comparative Balance Sheet:
The balance sheet prepared on a particular date reveals the
financial position of the concern on the date to study the trends of business over a
period of time comparative balance sheet reveals the cause for changes in the financial
position comparative balance sheet reveals the cause for changes in the financial
position of amount of various transactions. The comparative studies throw light on
financial policies adopted by management.
Comparative balance sheet of an enterprise is prepared to show different
assets, liabilities and capital as on two or more dates so as to compare and ascertain
any increase or decrease in absolute items and also percentages changes. The
comparative balance sheet analysis, in the words of Foulke, “is the study of the trend
of the same items, group of items and computed items in two or more balance sheets
of the same business enterprise on different dates.” The changes in the balance sheet
items reflect the conduct of a business. The changes can be observed by comparison of
the balance sheet at the beginning and at the end of a period and these changes can
help in forming an opinion about the progress of an enterprise.
 Advantages Of Comparative Balance Sheet :
1. The comparative balance sheet is more useful than a simple balance sheet as it
shows data which may be used to study the trend of a business enterprise.
2. It helps in forming an opinion about the progress of an enterprise.
3. The emphasis, in a single balance sheet, is on status, whereas in a comparative

balance sheet the emphasis is on change. Thus, it is a dynamic statement.
4. It can be used as a tool in analysing and evaluating the financial position of a firm
over a period of number of years.
 Procedure Of Preparing A Comparative Balance Sheet :
A comparative balance sheet contains the following columns :
(i) Particulars column.

(ii) Data of Previous period/year’s balance sheet.
(iii) Data of the current year’s balance sheet.
(iv) Increase or decrease in the absolute data.
(v) Percentage change of increase or decrease in data.
 Guidelines For Interpretation Of Comparative Balance Sheet:
While interpreting Comparative Balance Sheet the interpreter is expected to study the
following aspects:
(1 ) Current financial position and liquidity position.
(2) Long term financial position.
(3) Profitability of the concern.
(1) For studying current financial position or short -term financial position of a
concern, one should see the working capital in both the years. The excess of current
assets over current liabilities will give the figures of working capital. The increase in
working capital will mean improvement in the current financial position of the
business. An increase in current assets accompanied by the increase in current
liabilities of same amount will not show any improvement in the short-term financial
position.
The second aspect which should be studied in current financial position is the liquidity
position of the concern. If liquid assets like cash in hand, cash at bank, bills
receivables, debtors, etc. show an increase in the second year over the first year, this
will improve the liquidity position of the concern. The increase in inventory can be on
account of accumulation of stocks for want of customers, decrease in demand or
inadequate sales promotion efforts. An increase in inventory may increase working
capital of the business but it will not be good for the business.
(2) The long -term financial position of the concern can be analysed by studying the
changes in fixed assets, long-term liabilities and capital .The proper financial policy of
concern will be to finance fixed assets by the issue of either long-term securities such
as debentures, bonds, loans from financial institutions or issue of fresh share capital.
An increase in fixed assets should be compared to the increase in long-term loans and
capital. If the increase in fixed assets is more than the increase in long term securities
then part of fixed assets has been financed from the working capital. On the other
hand, if the increase in long-term securities is more than the increase in fixed assets
then fixed assets have not only been financed from long-term sources but part of
working capital has also been financed from long-term sources. A wise policy will be
to finance fixed assets by raising long-term funds.
The nature of assets which have increased or decreased should also be studied to form
an opinion about the future production possibilities. The increase in plant and
machinery will increase production capacity of the concern. On the liabilities side, the
increase in loaned funds will mean an increase in interest liability whereas an increase
in share capital will not increase any liability for paying interest. An opinion about the
long-term financial position should be formed after taking into consideration above
mentioned aspects.
(3) The next aspect to be studied in a comparative balance sheet question is the
profitability of the concern. The study of increase or decrease in retained earnings,
various resources and surpluses, etc. will enable the interpreter to see whether the
profitability has improved or not. An increase in the balance of Profit and Loss
Account and other resources created from profits will mean an increase in profitability
to the concern. The decrease in such accounts may mean issue of dividend, issue of
bonus shares or deterioration in profitability of the concern.
(4) After studying various assets and liabilities an opinion should be formed about
the financial position of the concern. One cannot say if short-term financial position is
good then long-term financial position will also be good or vice-versa. A concluding
word about the overall financial position must be given at the end.
Comparative Balance Sheet Statement of two Years
PARTICULARS 2013 2014 Increase/ Percentage

decrease changes
I. ASSETS
 Non-Current Assets:
(i) FIXED ASSETS:
(a) Tangible assets
(b)Intangible assets
(c)Financial assets
(d)Other non-current assets
Total Non-current asset
 Current Asstes
(a) Inventories
(b) Financial assets
(i) Trade receivables
(ii) cash & cash
equivalents
(iii)Loans
(iv)Other financial
assets
(c)Other Currents Assets
Total Currents Assets
TOTAL ASSETS
II.EQUITY AND
LIABILITIES:
 Equity
(a)share capital
(b)Reserves and surplus
Total Equity
LIABILITIES
 Non-Current Liabilities
(a) Financial liabilities
(i) Borrowings (ii)Other
Financial Liabilities
(b) Provision
(c) Other Non-Current
Liabilities
Total Non current liabilities
 Current Liabilities
(a)short term borrowings
(b)Trade payables
(c)short term provisions
(d)Other current liabilities
Total Current Liabilities
TOTAL LIABILITIES
TOTAL EQUITY &

LIABIITIES
CHAPTER-5
ANALYSIS AND INTERPRETATION
COMPARATIVE INCOME STATEMENT
Comparative Income Statement Of VSP Ltd For The Year 2016-17
& 2017-18 (in crores)
PARTICULARS 2016-17 2017-18 Increase/ Percentage

decrease changes
INCOME:
I. Revenue from operations 12,418.74 14,607.18 2188.44 17.62%
II. Other Income 260.29 265.24 4.95 1.901%
III. Total Income(I+II) 12,679.03 14,872.42 2193.39 17.29%
IV. Expenses
Cost of material consumed 6,945.2 8601.05 1655.85 23.84%
Changes in Inventory of
finished goods & work in (397.54) (186.34) (211.2) -53.12%
progress
Excise Duty 1,277.56 262.80 -1014.76 -79.42%
Employee benefit Expenses 2,163.83 2,343.60 179.77 8.307%
Finance cost 767.74 938.33 170.59 22.21%
Depreciation & Amortisation
expenses 658.86 778.26 119.4 18.12%
Other Expenses 2,953.87 3,505.12 551.25 18.66%
Total Expenses(IV) 14,369.53 16,242.82 1873.29 13.03%
V. Profit/(Loss) before
Exceptional Items & tax (1690.49) (1,370.40) -320.09 -18.93%
(III-IV)
VI. Exceptional Items - 541.05 541.05 100%
VII. Profit /(Loss) before (1690.49) (1911.45) -220.96 -13.07%
tax (V-VI)
VIII. Tax Expenses/Credit
Current tax - - - -
Deferred tax (428.68) (542.44) -113.76 -26.53%
Earlier year adjustment 1.34 - -1.34 -100%
Total tax expenses/
Credit(VIII) (427.34) (542.44) -115.1 -26.93%
IX. Profit/(Loss) for the
year from continuing (1263.16) (1369.01) -105.85 -8.379%
operations(VII-VIII)
X. Profit/(Loss) for the
year from discontinuing - - - -
operations
XI. Profit/ Loss for the (1263.16) (1369.01) -105.85 8.379%

period (IX+X)
INTERPRETATION:
The comparative income statement for the year 2016-17& 2017-18 reveals
that there is an increment in the income with 17.29%, while the expenses showed an
increase upto 13.03%. The profit after the tax showed a very high decrease of -
8.379%, which reveals that the company is running in losses.
Comparative Income Statement Of VSP Ltd For The
Year 2015-16 & 2016-17(in crores)

decrease changes
INCOME:
I.Revenue from operations 10,163.04 12,418.74 1805.7 17.76%
II. Other Income 348.92 260.29 -88.63 -25.4%
III. Total Income(I+II) 10511.96 12,679.03 2167.07 20.61%
IV. Expenses
Cost of material consumed 4141.59 6,945.2 2803.41 67.68%
finished goods & work in 1149.72 (397.54) -1547.26 -134.54%
progress
Excise Duty 1143.40 1,277.56 134.16 11.73%
Employee benefit Expenses 1881.87 2,163.83 281.96 14.98%
Finance cost 676.70 767.74 91.04 13.45%
Depreciation& Amortisation 365.66 658.86 293.2 80.18%
expenses
Other Expenses 2854.83 2,953.87 99.04 3.469%
Total Expenses(IV) 12213.78 14,369.53 2155.75 17.65%
Exceptional Items & tax (1701.82) (1690.49) 11.33 -0.665%
(III-IV)
VI. Exceptional Items - - -
VII. Profit /(Loss) before
tax (V-VI) (1701.82) (1690.49) 11.33 -0.665%

VIII.Tax Expenses/Credit
Current tax - - - -
Deferred tax (98.10) (428.68) -330.58 336.98%
Earlier year adjustment - 1.34 1.34 100%
Total tax expenses/
Credit(VIII) (98.10) (427.34) -329.24 335.61%
year from continuing (1603.72) (1263.16) 340.56 21.23%
operations
XII. Profit/ Loss for the (1603.72) (1263.16) 340.56 21.23%

period (IX+X)
INTERPRETATION:
that there is an increment in the income with 20.16%, while the expenses showed an
increase upto 17.65% The profit/loss after the tax is 21.23% compared the before year
the loss is decrease but the company is running in losses.
Comparative Income Statement Of VSP Ltd For The Year 2014-
15& 2015-16 (in crores)
decrease changes
INCOME:
I.Revenue from operations 10,432.17 10,163.04 -269.13 -2.579%
II. Other Income 256.29 348.92 92.63 36.142%
III. Total Income(I+II) 10688.46 10511.96 -176.5 -1.651%
IV. Expenses
Cost of material consumed 5127.54 4141.59 -985.95 -19.22%
finished goods & work in (820.19) 1149.72 1969.91 -240.17%
progress
Excise Duty 1117.81 1143.40 25.59 -2.289%
Employee benefit Expenses 1918.16 1881.87 -36.46 -1.9%
Finance cost 434.73 676.70 241.97 55.65%
Depreciation& Amortisation 270.63 365.66 95.03 35.11%
expenses
Other Expenses 2541.76 2854.83 313.07 2.31%
Total Expenses(IV) 10590.44 12213.78 1623.34 15.32%
Exceptional Items & tax 98.02 (1701.82) -1799.84 -183.66%
(III-IV)
VI. Exceptional Items - - - -
tax (V-VI) 98.02 (1701.82) -1799.84 -183.66%

Current tax - - - -
Deferred tax 40.97 (98.10) -139.07 -339.44%
Earlier year adjustment - - -
Total tax expenses/
Credit(VIII) 40.97 (98.10) -139.07 -339.44%
year from continuing 57.05 (1603.72) -1660.77 -2911.07%
year from discontinuing - -
operations
XIII. Profit/ Loss for the 57.05 (1603.72) -1660.77 -2911.07%

period (IX+X)
INTERPRETATION:
that there is an decrease in the income with -1.065%, while the expenses showed an
increase upto 15.32%. The profit/loss after the tax showed a very high decrease of -
2911.07% which shows the company is running in losses.
Comparative Income Statement Of VSP Ltd For The Year 2013-
14& 2014-15 (in crores)

decrease changes
INCOME:
I.Revenue from operations 13431.48 10,432.17 -2999.31 -22.33%
II. Other Income 306.99 256.29 -50.7 -16.51%
III. Total Income(I+II) 13738.47 10688.46 -3050.01 -22.200%
IV. Expenses
Cost of material consumed 6967.25 5127.54 -1839.71 -26.405%
finished goods & work in 7.06 (820.19) -827.25 -11717.42%
progress
Excise Duty 1403.15 1117.81 -285.34 -20.33%
Employee benefit Expenses 1751.10 1918.16 167.06 9.540%
Finance cost 338.12 434.73 96.61 28.57%
Depreciation &Amortisation 271.48 270.63 -0.85 -0.3130%
expenses
Other Expenses 2453.04 2541.76 88.72 3.616%
Total Expenses(IV) 13191.2 10590.44 -2600.76 -19.715%
Exceptional Items & tax 547.27 98.02 -449.25 -82.08%
(III-IV)
VI. Exceptional Items - -
tax (V-VI) 547.27 98.02 -449.25 -82.08%

Current tax - - - -
Deferred tax 189.80 40.97 -148.83 -78.41%
Earlier year adjustment (7.10) - 7.10 100
Total tax expenses/
Credit(VIII) 182.7 40.97 -141.73 -77.57%
year from continuing 364.57 57.05 -307.53 -84.35%
operations
XIV. Profit/ Loss for the 364.57 57.05 -307.53 -84.35%

period (IX+X)
INTERPRETATION:
that there is an decrease in the income with -22.2%, while the expenses showed an
decrease upto 19715%. The profit/loss after the tax is in decrease of -84.35% bu the
company gained profit of 57.05(in crores) which shows the company is running in
profit.
COMPARATIVE BALANCE SHEET
STATEMENT
Comparative Balance Sheet Statement Of VSP Ltd For The Year
2016-17 & 2017-18 (in crores)

decrease changes
I. ASSETS
Non-Current Assets:
12,902.88 16,772.14 3869.26 29.98%
 Property, plant and
equipment
 Capital work-in-progess 7,768.96 5,224.66 -2544.3 -32.74%
 Other intangible assets 25.21 10.49 -14.72 -58.38%
 Intangible asset under - - - -
development
 Financial assets
(i) Investments 740.88 741.48 0.6 0.0809%
(ii) loans
228.99 222.29 -6.7 2.92%
(iii)Other financial
21.67 23.28 1.61 7.42%
assets
 Deferred tax asset(net)
242.41 778.14 535.73 221.001%
 Other non-current assets
158.02 119.34 -38.68 -32.41%
Total Non-current assets
Current Asstes 22,089.03 23,891.82 1802.79 8.16%
(c) Inventories
(d) Financial assets 4766.85 5628.67 861.82 18.07%

(ii) cash & cash 878.80 995.98 117.18 13.33%
equivalents
(iii)Loans 53.90 51.90 -2 -3.71%
- - - -
(iv)Other financial 440.84 471.29 30.45 6.9%
assets
(c) Other Tax Assets (Net)
0.01 0.01 0 0%
(d) Other Currents Assets
Total Currents Assets 636.48 684.53 48.05 7.54%
TOTAL ASSETS 6776.88 7832.38 1055.5 15.57%
28865.91 31724.20 2858.29 9.903%

II.EQUITY AND
LIABILITIES:
Equity
(a) Equity share capital
(b) Other equity (i)Reserves 4889.85 4889.85 0 0
and surplus (ii)Other
comprehensive income
Total Equity 3679.81 2331.11 -1348.7 36.65%
LIABILITIES
- - -
Non-Current Liabilities
(a) Financial liabilities 8569.66 7220.96 -1348.7 -15.73%

(b)Provision
(c) Deferred tax 5841.71 6545.16 703.45 12.04%
liabilities(Net)
(d) Other Non-Current
Liabilities 13.53 25.90 12.37 91.42%
956.06 1012.97 56.91 5.95%
- - - -
76.75 82.39 5.64 7.34%

Total Non-Current Liabilities
6896.05 7666.42 770.37 11.12%
Current Liabilities
(a) Financial Liabilities
(i) Borrowings
(ii)Trade Payable 8048.84 9221.27 1172.43 14.56%
(iii) Other Financial
1037.85 1197.57 159.72 15.38%
liabilities
3525.07 5253.14 1728.07 49.02%
(iv) Derivatives
(b) Provision
138.38 0.60 -137.78 -99.56%
(c)Other current liabilities
137.59 668.32 530.75 385.74%
512.47 495.92 -16.55 -3.22%
TOTAL LIABILITIES 13400.20 16836.82 3436.62 25.64%
TOTAL EQUITY & 20296.25 24503.24 4206.99 20.72%

LIABIITIES
28865.91 31724.20 2858.29 9.901%
INTERPRETATION:
The comparative balance sheet statement of 2016-17& 2017-18 shows that the total
assets and total equity liabilities of 2016-17 is 28865.91 and 2017-18 is 31724.20
which as been increased upto 9.901%. There is an increment in Total Non-Current
Assets of 8.16% and the Total Current Asset is increased of 15.57% where as the Total
Equity is been decreased upto 15.73% and the Total Non-Current Liabilities & Current
Liabilities is been increased with 11.12% and 25.64%
2015-16 & 2016-17 (in crores)

decrease changes
II. ASSETS
Non-Current Assets:
11917.66 12,902.88 984.78 8.263%
(a) Property, plant and
equipment
(b) Capital work-in-progess 6988.67 7,768.96 780.29 0.1112%
(c) Other intangible assets 37.49 25.21 -12.28 -32.75%
(d) Intangible asset under 2.70 - -2.70 -100%
development
(e) Financial assets
(i) Investments
697.59 740.88 43.29 6.205%
(ii) loans
154.74 228.99 74.25 47.98%
(iii)Other financial
157.09 21.67 -135.42 85.85%
assets
(f) Deferred tax asset(net)
- 242.41 242.41 100%
(g) Other non-current assets
Total Non-current assets 116.14 158.02 41.88 36.05%
Current Asstes 20072.08 22,089.03 2016.95 10.04%

(a) Inventories
(b) Financial assets 3810.60 4766.85 956.25 25.09%

(ii) cash & cash 956.78 878.80 -77.98 8.15%
equivalents 45.56 53.90 8.34 18.30%
(iii)Loan
- - - -
(v) Other financial 282.21 440.84 158.63 56.20%
assets
7.00 0.01 -6.99 -99.8%
670.28 636.48 -33.8 5.042%
TOTAL ASSETS 5772.43 6776.88 1004.45 17.40%
25844.51 28865.91 3021.4 1.169%

II.EQUITY AND
LIABILITIES:
Equity
(b) Other equity (i)Reserves 4889.85 4889.85 0 0%
comprehensive
income 4978.98 3679.81 -1299.17 -26.09%
Total Equity - - - -
LIABILITIES
9868.83 8569.66 -1299.17 -13.16%
(i) Borrowings
(ii) Other Financial
Liabilities 3805.48 5841.71 2036.23 53.50%
(b)Provision
(c) Deferred tax 13.56 13.53 -0.03 -0.221%
liabilities(Net)
(d) Other Non-Current 853.59 964.06 110.47 0.129%
Liabilities 202.37 - -202.37 -100%
7.15 76.75 69.6 973.42

4882.15 6896.05 2013.9 41.25%
Current Liabilities
(i) Borrowings
(ii)Trade Payable 6585.64 8048.84 1463.2 22.21%
733.56 1037.85 304.28 41.48%
liabilities
3128.98 3525.07 396.09 12.65%
(iv) Derivatives
(b) Provision
54.17 138.38 84.21 155.45%
102.51 137.59 35.08 34.22%
488.67 512.47 23.8 4.87%
TOTAL EQUITY & 15975.68 20296.25 4320.57 27.044%

LIABIITIES
25844.51 28865.91 3021.4 1.169%
INTERPRETATION:
Assets of 10.04% and the Total Current Asset is increased of 17.4% where as the Total
Equity is been decreased upto 13.16% and the Total Non-Current Liabilities & Current
Liabilities is been increased with 41.25% and 20.79%.
2014-15 & 2015-16 (in crores)

decrease changes
III. ASSETS
Non-Current Assets:
5745.15 11917.66 6172.51 107.43%
equipment
(b) Capital work-in-progess 11492.98 6988.67 -4504.31 -39.19%
(c) Other intangible assets 51.33 37.49 -19.84 -38.65%
(d) Intangible asset under 2.57 2.70 0.13 0.0063%
development
(i)Investments
601.69 697.59 95.9 15.93%
(ii)loans
(iii) Other financial 182.90 154.74 -28.16 -15.39%
assets 125.96 157.09 31.13 24.51%
(g) Other non-current assets - - - -
Total Non-current assets 172.18 116.14 -56.04 -32.54%
Current Assets
18374.76 20072.08 1697.32 9.23%
(a) Inventories

5095.77 3810.60 -1285.17 -25.22%
(ii) cash & cash
1034.10 956.78 -77.32 -7.47%
equivalents
63.94 45.56 -18.38 -28.74%
(iii)Loans
0.38 - - -
(vi)Other financial 292.61 282.21 -10.4 -3.55%
assets
(f) Other Tax Assets (Net)
52.30 7.00 -45.3 -86.61%
(g) Other Currents Assets
717.89 670.28 -47.62 -6.63%
TOTAL ASSETS 7256.99 5772.43 -1484.56 -20.45%
25631.75 25844.51 212.76 0.830%

II.EQUITY AND
LIABILITIES:
Equity
(b) Other equity (i)Reserves 4889.85 4889.85 0 0%
Total Equity 6627.98 4978.98 -1649.13 -24.88%
LIABILITIES
- - - -
11517.83 9868.83 -1649.13 -14.31%
(b) Provision
(c) Deferred tax
66.52 3805.48 3738.96 562.08%
liabilities(Net)
(d) Other Non-Current 51.65 13.56 -38.09 73.74%
Liabilities
557.14 853.59 296.45 53.2%
324.45 202.37 -122.08 -37.62%
6.55 7.15 0.6 9.16%

1006.31 4882.15 3875.84 385.15%
Current Liabilities
(i) Borrowings
(ii)Trade Payable 7444.89 6585.64 -859.25 -11.54%
600.60 733.56 132.96 22.13%
liabilities
4254.97 3128.98 -1125.99 -26.46%
(iv) Derivatives
(b) Provision
31.42 54.17 22.75 72.4%
198.93 102.51 -96.42 -48.46%
576.80 488.67 -88.13 -15.27%
TOTAL LIABILITIES 13107.61 11093.53 -2014.08 -15.36%
TOTAL EQUITY & 14113.92 15975.68 1861.76 13.19%

LIABIITIES
25631.75 25844.51 212.76 0.830%
INTERPRETATION:
Assets of 9.23% and the Total Current Asset is decreased upto 20.45% where as the
Total Equity is been decreased upto 14.31% and the Total Non-Current Liabilities is
been increased with 385.15% & Current Liabilities is decreased upto 20.79%.
2013-14 & 2014-15 (in crores)

decrease changes
I. ASSETS
Non-Current Assets:
4530.03 5745.15 1215.12 26.82%
equipment
(b) Capital work-in-progess 10665.07 11492.98 827.91 7.76%
(c) Other intangible assets 2.75 51.33 48.58 1766.54%
(d) Intangible asset under 30.11 2.57 -27.54 -91.46%
development
(i)Investments
362.53 601.69 239.16 65.96%
(ii)loans
(iii) Other financial 620.45 182.90 -437.55 -70.52%
assets - 125.96 125.06 100%
(g) Other non-current assets - - - -
Total Non-current assets 60.23 172.18 111.95 185.87
Current Assets
16271.17 18374.76 2103.59 12.92%
(a) Inventories
(b)Financial assets
3863.04 5095.77 1232.73 31.91%
(ii) cash & cash
803.65 1034.10 230.45 28.67%
equivalents
(iii)Loans 175.89 63.94 -111.95 -63.64%
3443.81 0.38 -3443.43 -99.9%

(vii) Other financial - 292.61 292.61 100%
assets
- 52.30 52.30 100%
114.27 717.89 603.62 528.24%
TOTAL ASSETS 8400.66 7256.99 -1143.67 -13.61%
24671.83 25631.75 959.92 3.89%

II.EQUITY AND
LIABILITIES:
Equity
(b) Equity share capital
(c) Other equity (i)Reserves 5739.85 4889.85 -850 -14.8%
Total Equity 6400.89 6627.98 227.09 3.547%
LIABILITIES
- - - -
12140.74 11517.83 -622.91 -5.13%
(b) Provision
(c) Deferred tax
1203.53 66.52 -1137.01 -94.47%
liabilities(Net)
(d) Other Non-Current - 51.65 51.65 100%
Liabilities
531.43 557.14 25.71 4.83%
419.01 324.45 -94.56 -22.56%
165.56 6.55 -159.01 96.604%

2319.53 1006.31 -1313.22 -56.61%
Current Liabilities
(i) Borrowings
(ii)Trade Payable 3739.93 7444.89 3704.96 99.06%
829.93 600.60 -229.33 -27.63%
liabilities
- 4254.97 4254.97 100%
(iv) Derivatives
(b) Provision
- 31.42 31.42 100%
157.65 198.93 41.28 26.18%
5484.05 576.80 -4907.25 -89.4%
TOTAL EQUITY & 12531.13 14113.92 1582.79 12.63%

LIABIITIES
24671.83 25631.75 959.92 3.89%
INTERPRETATION:
Assets of 12.92% and the Total Current Asset is decreased upto 13.61% where as the
Total Equity is been decreased upto 5.13% and the Total Non-Current Liabilities is
decreased with 56.61% & Current Liabilities is decreased upto 28.36%.
CHAPTER-6
SUMMARY, FINDINGS &

SUGGESTIONS
SUMMARY
Finance is the life-blood of business. It is very essential for the smooth

running of the business and controls the policies, activities and decision of every
business.
Efficient management of financial resources and deliberate analysis

results for the success of an enterprise. Financial statements are the basis for decision
making for the management and also for the other outsiders who are interested in the
affairs of the firm. Financial management involves in the finance function. It is
concerned with the planning, organizing, directing, and controlling the financial
activities of an enterprise. It deals mainly with raising funds in the most economic and
suitable manner, using these funds as profitably as possible; planning future
operations and controlling current performance and future developments through
financial accounting, cost accounting, budgeting, statistics and other means
management. It is continuous process which achieves an adequate rate of return on
investment, as this is necessary for survival and the attracting of new capital.
Steel is a widely used construction material across the world, and is

itself actually an alloy of iron and carbon. It also has manganese , silicon ,oxygen
,phosphorus ,and sulphur in smaller amounts. The steel industry is the second largest
one globally after the oil and gas industry ,with an approximate turnover of
$900billionUSD.
RASHTIRYA ISPAT NIGAM LTD a Navratna PSE, is the corporate

entity of Visakhapatnam steel plant the country’s first shore based integrated steel
Plant at Visakhapatnam, Andhra Pradesh, set up with a capacity of 3.0Mtpa of liquid
steel, started production from its 6.3Mtpa Expansion facilities. It is the only seacoast
based, integrated steel plant in the country.
The completion of construction and commissioning of the whole plant

in 1992, the cost escalated to around 8500 cores. It is the modern steel plant in the
country.
Comparative financial statements both the comparative Profit and Loss

Account and comparative Balance sheet are covered. Such comparative statements are
prepared not only to the comparison of the various figures of two or more periods but
also the relationship between various elements embodied in profit and loss account
and balance sheet.
Present the performance of the company in terms of both Production

and sales Revenue has been satisfactory, the company surround various adverse
situations during the past 25 years and has now been conferred the status of Mini
Ratna by the government of India.
This study concentrated on the financial state of affairs of the company

RINL. It involved study of Balance sheet profit and loss account and ratio and also
their comparison over the last five years, it has presented a border picture of the
financial position of the company. The study analyzed the company success is being
able to effectively manage its day to day requirements pertaining to cash and funds
flow and effectively channelizing the short term and long term funds of the company
to meet their requirements.
FINDINGS
 Since last three years RINL is running in the loss.

 The Reserves and Surplus are decreased position every year.
 Even after the request of the customer the prices are not at all being changed the
management which result in the poor customer relationship, which results in the
decrease in turnover.
 It is also heard that reason why the stock is lying more in quantity in the list of
current assets because of the high prices for the steel in the market.
 It is also observed that the cash and bank balance constitute for more percentage
in that total current assets every year.
 It is observed that technology is not enough sufficient for producing the steel
products efficiently.
SUGGESTIONS
If we can observe the over all management performance of VSP, we find some
favorable and adverse impacts on the organization profitability. Therefore I would like
to recommend some suggestions, which many useful to maximize the profits.
1) All other projects should have been started are yet to be taken up should be
completed in time along without cost over run to get the benefits to the company
based on the projects, detailed projected report and should get IRR as envisaged in the
respective DPRS.
2) Though the company as recorded very good improvement in managing the
inventories and debtors. The firm was not able to generate the reasonable turnover
over the fixed assets. So, this calls for future improvement in the ratio, by generating
more sales.
3) Another reason for the company to have the less net profit is, due to the increase
in its expenditure and operating expenses. The company may consider by that
efficiency can be improved further by reduced the operating expenses.
4) The other many area where VSP has tremendous scope for improvement is in
manufacturing of value added products and concentrating on the exports. This will
result I better sales realization and higher profits.
CONCLUSION
Comparative statements are prepared not only to the comparison of the various
figures of two or more periods but also the relationship between various elements
embodied in profit and loss account and balance sheet. According to my study in
RASHTRIYA ISPAT NIJAM LIMITED present the performance of the company in
terms of both Production and sales Revenue has been satisfactory.
BIBILIOGRAPHY
Annual reports:
Annual report of RINL from 2013-14 to 2017-18
Books:
1. Essentials of financial management-I.M. Pandey
2. Financial management -Prasanna Chandra Financial management
-Khan &Jain
3. Management Accounting - R.K.Sharma and Shashi. K. Gupta -Kalyani Publishers.
Websites:
 http://www.moneycontrol.com
 http://steel.gov.in/overview.htm
 www.vizagsteel.com

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CHAPTER-1

INTRODUCTION OF THE STUDY

 Introduction of financial analysis:

 Comparative statement analysis:

(b) Absolute data in money value.

(c) Increase or Decrease between the absolute figures in money value.

(d) Changes or trend in various figures in terms of percentage.

Percentage of change = change in amount/base year amount*100.

 Comparative balance sheet:

Rashtriya Ispat Nigam Limited is multi- product steel-

The objectives of the study are as follows:

 To study the profile of the Steel Industry.

 To analyze the overall operations and performance of the firm efficiently.

 To suggest measures to the company to improve efficiency of the organization.

Methodology is a systematic procedure of collecting information in order to

1. Primary sources &

It is the information collected directly without any references. In this study it is

(c) Annual Reports of the company.

• Respondents may not provide accurate information due to various reasons.

 Introduction of steel industry in India:

 Objective Of Steel Policy:

 Poor Quality of basic infrastructure like road, port etc.

 Unexplored Rural Market

In order to provide accelerated thrust on R&D, Ministry of Steel is

(A) R & D with Steel Development Fund (SDF):

(B) R&D with Government Budgetary Support (GBS):

 Exports: Although the focus of Indian steel industry is on the domestic

RASHTIRYA ISPAT NIGAM LTD a Navratna PSE, is the corporate entity of

 7 meter tall coke ovens.

 Dry quenching of coke.

 On ground blending of sinter base mix.

 Conveyor charging and bell less top for blast furnace.

 100% continuous casting of liquid steel.

 Computerization for process control.

 Sophisticated high speed and high production rolling mills.

Major sources of raw materials are;

Iron ore lumps & fines Biladilla Chhattisgarh.

Bf lime stone Jaggayyapeta, A.P.

SMS lime stone UAE

BF dolomite Madharam, A.P.

SMS dolomite Madharam, A.P.

Manganese ore Chipurupalli, A.P.

Coking Coal Australia/US

Medium coking coal Kathara / Swang / Raja Rappa / Kedla

Imported boiler coal Indonesia

Imported lam coke China

Quartizite lump & fines local

Sand Sarepalli, A.P.

Angels Rounds Nuts coke Toluene

Billets Flats Coke dust Wash oil

Channels Re-bars Coal tar Granulated slag

Beams Wire rods Anthracene oil Lime fines

Squares HP Naphthalene Ammonium

To attain 20 million tons (Mt) liquid steel capacity through technological

 Achieve Gross Margin to Turnover ratio > 10%.

 HUMAN RESOURCE MANAGEMENT:

 Various Departments Of VSP: There are 75 departments in Visakhapatnam steel

Sinter is a hard & porous ferrous material obtained by agglomeration of Iron

VSP produces steel employing three numbers of top blow Oxygen

VSP has six – 4 strand continuous casting machines capable of

Marketing Department of VSP has successfully entered into International

We, at Visakhapatnam steel plant, are committed to optimally utilize

 Promote a learning &Development eco system.

 Swot Analysis Of Visakhapatnam Steel Plant:-