Chapter 1

Introduction about the Organisation &

Industry.

1
1.1 BACK GROUND OF THE STUDY
Organization is set of people working together for accomplishment of a common
objective. The main purpose of the organisation is to attain certain and
predetermined goals. The roles and responsibilities are stated clear without any
ambiguity. The positions occupied by different individuals are presented in the
form of organizational structure, organization helps management to perform its
activity effectively, optimum use of technological improvement growth and
diversification, creatively, effective use of physical resources. The main purpose of
the training is to know how an organization works and to gain experience and
expose ourselves to corporate policies, ethics, culture, practices, procedures, facts
about the work culture and policies of the company.

1.2 OBJECTIVES OF THE STUDY

 To understand the organization structure or hierarchy of the company
 To understand working of the various departments.
 To know the functions and responsibilities of each department.

1.3 SCOPE OF THE STUDY

This report is based on the study conducted at TVS Limited
 Its main aim is to understand the company’s establishment, organisation structure,
various departments and its responsibilities, techniques, market strategies and many
more.
 Its aims to understand the skills of the company in the areas like technological
advancement, competition and in management.
 It helps to analyse the company’s performance in comparison to theoretical aspects.

2
1.4 INDUSTRY PROFILE
The automotive industry began in the 1860s with hundreds of manufacturers that
pioneered the horseless carriage. For many decades, the United States led the world in
total automobile production.The automotive industry comprises a wide rang
of companies and organizations involvedthe design, development, manufacturing, mar
keting, and selling of motor vehicles. It is one of the world's largest economic
sectors by revenue. The automotive industry does not include industries dedicated to
the maintenance of automobiles following delivery to the end-user, such as automobile
repair shops and motor fuel filling stations. Safety is a state that implies to be protected
from any risk, danger, damage or cause of injury. In the automotive industry, safety
means that users, operators or manufacturers do not face any risk or danger coming from
the motor vehicle or its spare parts. Safety for the automobiles themselves, implies that
there is no risk of damage. Around the world, there were about 806 million cars and
light trucks on the road in 2007, consuming over 980 billion liters of gasoline and diesel
fuel yearly. The automobile is a primary mode of transportation for many developed
economies.
The Detroit branch of Boston Consulting Group predicted that, by 2014, one-third of
world demand would be in the four BRIC markets (Brazil, Russia, India and China).
Meanwhile, in the developed countries, the automotive industry has slowed. It is also
expected that this trend will continue, especially as the younger generations of people
no longer want to own a car anymore, and prefer other modes of transport. Other
potentially powerful automotive markets are Iran and Indonesia. Emerging auto
markets already buy more cars than established markets. According to a J.D. Power
study, emerging markets accounted for 51 percent of the global light-vehicle sales in
2010. The study, performed in 2010 expected this trend to accelerate. However, more
recent reports (2012) confirmed the opposite; namely that the automotive industry was
slowing down even in BRIC countries. In the United States, vehicle sales peaked in
2000, at 17.8 million units.

3
World Motor Vehicle Production

 1950 USA had Produced more than 80% of motor Vehicle

 1950s: UK, Germany and France restarted production.
 1960s: Japan started production and increased volume through the 1980s. US, Japan,
Germany, France and UK produced about 80% of motor vehicles through the 1980s.
 1990s: South Korea became a volume producer. In 2004, Korea became No. 5
passing France.
 2000s: China increased its production drastically, and became the world's largest
producing country in 2009.
 2010s: India overtakes Korea, Canada, Spain to become 5th largest automobile
producer.
4
  2013: The share of China (25.4%), India, Korea, Brazil and Mexico rose to 43%,
while the share of USA (12.7%), Japan, Germany, France and UK fell to 34%.
 In 2018 India overtake German to become the 4th largest automobile producer.

1.4.1 Present scenario of automobile industry:

Real growth journey of automobile industry started in 1991 by the announcement of

New Industrial Policy de licensing of Automobile industry by Government of India. The
New Industrial Policy of 1991 provided that except in some special cases industrial
license is not required for setting I of automobile manufacturing unit. Progressive
liberalization was made by Government of India in the norms for Foreign Investment
and import of technology. This was done with a view to make the automobile industry
globally competitive. Continuous economic liberalization since 1991 witnessed a rapid
growth of automobile industry in India, thereby making India as one of the sought after
destination by global automotive players. Due to continuous growth of the industry in
India, the automobile sector has been aptly described as the sunrise sectors of the Indian
economy. Due to relaxed restrictions, positive support by government and increased
competitiveness, the Indian automobile industry has demonstrated sustained growth in
last two decades. Tata Motors, Maruti Suzuki, Mahindra and Mahindra, Ashok
Leyland are among those several automobile manufacturers who have expanded their
domestic and international operations. Continuous rapid growth of automobile industry
resulted in further expansion of domestic automobile market. The automobile industry
is expected to witness strong growth through 2020

5
 Chapter 2
Organization Profile

6
2.1 Logo of the Organization

Table 2.1 Organization Profile

Company Name TVS

Industry Automotive

Founder T V Sundaram Iyengar

Number of location 4 Two Wheeler and 1 Three Wheeler plant

Headquarters
Chennai, Tamil Nadu, India

Product
Motorcycles, scooters, three-
wheeler vehicles and spare parts

Service offered in India

Website https://www.tvsmotor.com/

2.1 About the Organization

Founded in 1979, TVS Motor Company, the USD 1.5 billion, flagship company of the
100 year old, USD 7 billion, TVS Group, is one of India’s leading two-wheeler
manufacturers and among the top seven in the world. The company has the widest range
of products in the Indian two and three wheeler industry with exports to more than 60
countries worldwide. Driven by technology and innovation at the helm, TVS Motor
Company boasts of a rich talent pool of more than 7000 personnel who constantly
emphasize the company’s commitment to ensure best practices in state-of-the-art

7
manufacturing facilities at Hosur in Tamilnadu, Mysore in Karnataka, Nalagarh in
Himachal Pradesh and Karawang in Indonesia. Mr.Venu Srinivasan, the Chairman of.
It was the first Indian company to deploy a catalytic converter in a 100 cc motorcycle
and the first to indigenously produce a four stroke 150cc motorcycle. In 2006, the
company’s TVS became the first Indian automobile manufacturer to roll out as many as
seven new products on a single day, a testimony to its manufacturing prower. TVS Motor
Company’s customer inspired engineering approach, has enabled it to introduce the widest
product range that caters to all segments of the two and three wheeler industry in India. Total
customer satisfaction is achieved through excellence in quality that stems from the company’s
management philosophy which is based on the five pillars of TQM (Total Quality Management).
Quality awareness therefore percolates through the entire organisation from new product
development to after sales services. Some of the competitors in the market.

2.2 Nature of business

Automobile manufacturers: Every day, there is a relentless demand on the shop floor
of TVS. They create world class engines, chassis, full vehicle bodies and everything
else in between. They are the largest vehicle manufacturers in India, which produced
2 wheels and 3wheels

Manufacturing and Technology: The company has consistently relied on its in-house
R&D talent and indigenous technology for leading innovations in the industry. Tvs

8
introduced BS4 engine driven by an inline fuel pump. In order to meet the BS-VI
emission standard, the company has developed the innovative iGen6 technology that
will ensure higher operating profits for customers.

2.3 Vision, Mission, Values and Quality policy:

2.3.1 Vision:
TVS motors will be one among the top two wheelers manufacturers in India and one
among the top five two wheeler manufacturers in Asia.

2.3.2 Mission:

We are committed to being a highly profitable, socially responsible, and leading

manufacturer of high value for money, environmentally friendly, lifetime personal
transportation products under the TVS brands, for customers predominantly in Asian
markets and to provide fulfillment and prosperity for employees, dealers and suppliers.

2.3.3 Quality policies:

 Deliver on-time & on-quality products, systems and services that meet or exceed our
customers & users expectation
 Identify and understand our customer’s expectations, measure customer perceptions,
and implement improvement to increase customer satisfaction & loyalty.

2.4 Products:

TVS caters to a wide range of automotive categories which include mopeds (XL, Super
XL, Super Heavy Duty, XL 100, XL 100 Comfort), Scooters (TVS Scooty pep, Scooty
zest 110, Wego 110, Jupiter), Motorcycles (Sport, Start city +110, Victor 2016 Phoenix
125, TVS Apache RTR 160, 180, 200 and 200 4V) and 3 wheelers (King), which all
come under the product strategy in the marketing mix of TVS Motors. TVS has earnt a
reputation of producing very innovative solutions for its product lineup. It has innovated
such products as TVS 50, India’s first two seater moped, Scooty, India’s first scooterette,
TVS Champ, India’s first Digital Ignition, Apache, India’s first bike to feature Anti-
Lock Braking System, Jive, first bike in India without a clutch, Wego, first scooter
featuring Body balance technology, Victor, first indegeniously developed Indian bike.
So catering to mass markets as well as young working professionals, smart independent
women and sports oriented youngsters, TVS has a wide range of products

9
 TVS Ntorq

TVS Radeon

TVS Apache RTR

series

TVS Jupiter

10
TVS scooty pep+

TVS Apache RR 310

TVS Sport

TVS Brown XL100

11
TVS Akula 310

TVS Zeppelin

TVS King Auto

12
 TVS iQube

ENGINES

Industrial Engine

13
2.5 Ownership pattern:

Name Designation

VENU SRINIVASAN Chairman & Managing Director

SUDARSHAN VENU Joint Managing Director

K.N. RADHAKRISHNAN Director & CEO

K.S. SRINIVASAN Company Secretary

H. LAKSHMANAN Committee

SUDARSHAN VENU Committee

SUDARSHAN VENU Committee

C.R. DUA Committee

K. GOPALA DESIKAN Chief Financial

A.N. RAMAN Cost Auditor

14
2.5.1 Organization structure

Production Management Strategies:

Long range strategies:

 Effective management of technology.

 Innovation in product management and process technology.
 Globalization in industry.
 Goodwill inside and outside the organization.
 An aggressive marketing strategy and risk taking ability.

15
Short range strategies:

 Location and layout.

 Product selection and technology.
 Capital selection and investment.
 Flexible strategy of production.
 Standardization of design.

2.6 Achievements
 TVS Motor won the prestigious Deming Application Prize in 2002
 In 2004, TVS Scooty Pep won the 'Outstanding Design Excellence Award
 TVS wins coveted 2009 Progressive Manufacturer 100 Award for end-to-end
automation.
 In 2015 Two Wheeler Manufacturer Of The Year.
 TVS Scooty Zest 110 is awarded the Most Appealing Executive Scooter by
J.D.Power Asia Pacific Awards for 2016.
 TVS StaR City + is awarded the highest ranked Economy Motorcycle 2018
 In 2019 Bike Awards Two wheeler manufacturer of the year

2.7 Future growth and prospects:

 To consolidate and further grow its market position, the company is ready with its
indigenous, cost effective iGen6 mid-nox engine technology for BS-VI.
 The company is in the process of developing new modular platform on which it plans
to roll out its future medium and heavy products.
 With the introduction of new platform, the company will be able to introduce
virtually every product with left-hand drive version as well.
 In some markets where volumes are promising the company is looking to set up
assembly plants
 Company looing toward the development of electric 2 wheel and electric 3 wheels.

16
 CHAPTER-3
MCKINSEY'S 7S FRAMEWORK

17
 MCKINSEY'S 7S FRAMEWORK
3.1 Introduction:
The McKinsey 7S Framework is a management model developed by business
consultants Robert H. Waterman, Jr. and Tom Peters in the 1980s. This was a strategic
vision for groups, to include businesses, business units, and teams. The 7S’s are
structure, strategy, systems, skills, style, staff and shared values. The model is most often
used as an organizational analysis tool to assess and monitor changes in the internal
situation of an organization.
The model is based on the theory that, for an organization to perform well, these seven
elements need to be aligned and mutually reinforcing. So, the model can be used to help
identify what needs to be realigned to improve performance, or to maintain alignment
during other types of change.

3.2 Meaning:
The 7S Framework of McKinsey's is a management model that describes seven factors
to organize a company in holistic and effective way.
Together these factors determine the way in which a corporation operates. Managers
should take into account all the seven of these factors, to be sure of successful
implementation of a strategy, large or small. They are all independent, so if the company
fail to pay proper attention to one of them, this may affect all others as well. On the top
that, the relative importance of each factor may vary over time. The 7S model provides
a useful framework for analyzing the strategic attributes of an organization. This
framework has helped various consultants in their duties of many companies. The most
interesting fact is that this model is similar to managerial functions that are widely
followed i.e., Planning, Organizing, Staffing, Leading and Controlling.
The Mckinsey’s 7S Framework involves seven either interdependent factors, which are
categorized as “hard”, or “soft” elements
"Hard" elements are easier to define or identify and management can directly influence
them, these are strategy statements; organization charts and reporting lines and formal
processes and IT systems.

"Soft" elements on the other hand, can be more difficult to describe, and are less
tangible and more influenced by culture. However, these soft elements are as the
important as the hard elements if the organization is going to be successful.
18
 McKinsey's 7S model

Structure: The way the organization represents the business divisions and units are
organized and includes the information of who is accountable to whom. In other words,
structure is the organizational chart of the firm. It is also one of the most visible and easy
to change elements of the framework.

Strategy: It is a plan developed by a firm to achieve sustained competitive advantage

and successfully compete in the market. In general, a sound strategy is the one that’s
clearly articulated, is long-term, helps to achieve competitive advantage and is
reinforced by strong vision, mission and values. But it’s hard to tell if such strategy is
well-aligned with other elements when analyzed alone. So the key in 7s model is not to
look at the company to find the great strategy, structure, systems and etc. but to look if
it’s aligned with other elements.

19
Systems: The processes and procedures of the company, which reveal business’ daily
activities and how decisions are made. Systems are the area of the firm that determines
how business is done.

Skills: The abilities that firm’s employees perform very well. They also include
capabilities and competences.

Staff: This element is concerned with what type and how many employees an
organization will need and how they will be recruited, trained, motivated and rewarded.

Style: This represents the way the company is managed by top-level managers, how
they interact, what actions do they take and their symbolic value. In other words, it is
the management style of company’s leaders.

Shared Values: These are at the core of McKinsey 7s model. They are the norms and
standards that guide employee behavior and company actions and thus, are the
foundation of every organization.

1. Structure:
It is the part for specialization and coordination. It comprise of the basis organization
of the company, its department, reporting lines areas of expertise, and responsibility
(and how they inter-relate), and the way in which the parts of a thing are arranged or
organized.
 Human Resource Department:

Human resource is the real asset of every organization. Human resource department in
TVS is known as personal service Department. Personal service Department focuses
on and influence the people who work in the organization. TVS has a good personal
department which always looks forward a efficiency. Welfare and security of the
employees. Responsibility of personal department is to ensure maximum utilization of
human resource.
Functions Of Personnel Department
 Framing personal policies
 Implementing programs
 Selection of personal
20
 Scientific placement
 Induction and orientation
 Establishing good industrial relations
 Effective communication
 Motivating the personal

 Sales Department:

The sales department mainly concentrates on the sales activities in the organization the
sales manages controls and formulates all the sales promotional and activities relates to
sales in the organization. Each product have separate department for sales, All
Department, M&M Department,Spare Parts Department.

SALES PROCESS

There are mainly three process

i. Pre sales process

ii. Sales
iii. Post Sales Process
 Financial Department:

Tvs Group Has A Combined Turnover Of More Than U$$ Billon The Tvs Group
Employs A Total A Around 25000. Charting A Steady Growth Path Of Expansion And
Diversification It Currency Comprises Of 30 Companies These Operate In Diverse Field
That Range From Two Wheeler And Automotive Dealership, Finance And Electronics.
Uniting These Multiple Business Is A Common Other Of Quality. Customer Service
And Social Responsibility. In Tvs The Finance Department Cent Rated. One Executive
Controls The Day To Day Financial Activates Of The Organization.

Function

1. Analysis of financial position and performance

2. Finance control
3. Identification of financial sources
4. Internal audit
5. Credit administration
6. Payment collection of all department.

21
 Information Technology Department:

Business Have Used Information Technology For Many Years To Automobile Tasks-
From Automated Book Keeping To Automated Manufacturing. More Recently,
Business Have Used Computer-Based Information System To Support The Analysis,
Interpretation, And Presentation Of Data In Business Decision Making E-Business And
E-Commerce Refers To All Business Transactions That Depend On Information
Technology. Today Information Technology Is An Inseparable Part Of Every
Organization. So Information System Plays A Vital Role In Tvs. This Is Used In All
The Departments In The Organization Like Hr Managemnet, Financial Management,
And Manufaturing Management Etc. The Organization Use Both Axapta & Unix
System For Controlling And Coordinating Of All Systems In The Organization.

 Production Department:

Raw materials as well as parts and components arrive at the manufacturing plant by
truck or rail, typically on a daily basis, as part of the just-in-time delivery system on
which many plants are scheduled, the materials and parts are delivers at the place where
they are used or installed. Manufacturing begins in the weld department with computer-
controlled fabrication of the frame from high strength frame materials. Components are
formed out of hollow metal shells fashioned from sheet metal. The various sections are
welded together. This process involves manual automatic and robotic equipment.

In the plastic department, small plastic resin pellets are melted and injected into molds
under high pressure to form various plastic body trim parts. This process is known as
injection molding.

Plastic and metal parts and components are painted in the paint department using a
process known as powder-coating. A powder-coating works like a large spray-painter,
dispersing paint through a pressurized system evenly across the metal frame.

 Administration Department:

Administrative department in TVS is concerned with maintaining all general activities

like construction, repairs, building, maintenance, dispatch, pricing and stationary,
reception, security, cleaning, canteen, arrangement, statutory complaints etc these
activities are maintained and finally it is reported to the General Manager.

22
 Structure of Administrative Department.

 Research & Development:

The company’s strong research and Development (R&D) team is continuously

working towards design and development of exciting new products for the customers.
Aided by modern CAD/ CAE resources and state-of-art facilities for engine and vehicle
design, development and testing, Noise, Vibration and Harshness (NVH) measurements,
R&D constantly develops new environment friendly technologies. The company also
collaborates with leading research laboratories and educational institutions for
developing future technologies.

23
2. Strategy:
 Increase their market share in India’s automobile industry by following a
disciplined growth. Strategy & delivering high quality customer service.
 Open scalable systems to deliver more products to more customers & to control
operating costs.
 Maintain their current high standards for service quality through disciplined risk
management.
 Continue to develop products & services that reduce their cost of funds.
 Focus on high earnings & growth with low volatility.
 TVS motors aim at total customer satisfaction.
3. Systems:
 Inventory control system:
Just in time & 2 bin system are followed by the TVS Motors Ltd, to control the
inventory. 2 bin system is a pull system to replenish the materials.
 Dealer Management System:
The company has been using a SAP ERP system since two years. However, some
mechanism was needed at the dealers end to monitor and meet customer needs.

4. Skills:
TVS Motors limited enhancing the skill of the employees by giving proper training,
regular feedback, discussing the issues faced and deriving at the best possible
solution to the problem.
 Skill Development Program:
 Consolidate the gaps employee wise
 Identify the training needs for particular groups
 Plan the program & execute.

5. Staff:
The TVS motors Ltd, consist of more than 5500 employees. These employees are
categorized on the basis of permanent and contract, the level of management. These
employees occupy the various position created through the process of organization.
Each position of the organization makes specific contribution to achieve organizational
objectives. On the basics of level of management.

24
6. Style:
In TVS motors, there is decentralization of authority. The subordinates can take
right decisions without the prior approved of the superiors. If any uncertainly occurs,
the management takes action to improve the quality of the product in consultation with
the employee. The management follows open door policy. They always welcome
suggestions from the employees & the best suggestion of the year will be considered &
that particular employee will be rewarded.

7. Shared Values:
The TVS Motors Ltd, has adopted TPM (Total Production Management) as its shared
values.
 TPM means:
 Setting a goal to maximize equipment efficiency.
 Establishing a total system for production maintenance for the entire life of the
equipment.
 Participation by all departments including equipment planning, operating &
maintenance department
 Involving all personnel, including top personnel to first line operators.

25
 Chapter 4
SWOT Analysis

26
SWOT analysis:

Fig 4.1 Swot Analysis

Strength:

 Differentiation: In comparison to competition TVS Motors has always maintained a

price differentiation strategy choosing to offer economy two-wheelers which are also
high on performance and fuel efficiency.
 Focus on local market: TVS Motors won the trust and confidence of the customer

through their mopeds which primarily targeted the local population. Even today the
company relies primarily on the local population for their business.
 Positioning: TVS Motors has always positioned their vehicles as reliable and easy to

use vehicles, which can run on Indian terrain. They are also well known for their
string regional connect.
 Emotional Value: TVS has been able to connect emotionally with the Indian

audience primarily through their association with moped which during the early days
used to be the most popular mode of transport in villages.
 Innovation: TVS Motors has been high on innovation and has a lot of firsts to its

credit. The company has always tried to stay in tune with the latest trends in styling,
performance and fuel efficiency, while also being conscious about developing
environmentally friendly vehicles that strictly adhere to compliance norms.
Weakness:
Weaknesses are used to refer to areas where the business or brand need improvement.
Some of the key weaknesses of TVS Motors are:
Low profitability: The Company for the past few years have been consistently
registering low profitability and showing single-digit margins in comparison to its
competitors who are showing double-digit margins.
27
 Launch time: TVS Motors has faced criticism for the longer time it takes to launch

new vehicles. The company takes more time than their competitors do to
introduce products into the market with the result that the competitors get an upper
hand over them giving them less time to react.
 Limited Global Reach: TVS Motors in comparison to competitors like Honda have

limited global reach and most of their focus is on domestic markets.

 Poor advertisements: TVS Motors have never been aggressive in advertising their

products with the result that their products do not have the brans recall or recognition
enjoyed by market leaders like Bajaj which are household names in India.
Opportunities:
Opportunities refer to surrounds the business on which it can capitalize to increase its
returns. Some of the opportunities include:
 Market potential: Research indicates that India is going to be the biggest market in
the world for two-wheelers, with a market size of 48,000 units per day. This is going
to be a huge opportunity for two-wheeler companies.
 mproved roads: The central government in India has a plan for the
massive development of roads and related infrastructure in rural India which will
increase the demand for two-wheelers in villages. TVS Motors which is already a
popular brand due to their mopeds will find it simple to capture this market.
 Change of trends: The growing number of dual-income households, the increase in
the need for smarter vehicle options to beat the crowded city roads, and growth in
rural infrastructure are all trends that will result in a surge in two-wheeler sales.
Threats:
Threats are those factors in the environment which can be detrimental to the growth of
the business. Some of the threats include:
 Technology: Some of the emerging technology areas like robot-driven cars,
alternate energy vehicles, interconnected traffic and safety systems may affect the
sale of two-wheelers since these are more adapted towards bigger vehicles.
Moreover, people may start preferring four-wheelers due to safety reasons as well.
 Competition: TVS Motors in spite of continuous attempts have not been able to
beat their two nearest rivals Bajaj Auto and Honda Motor Corp for the past many
years and continues to retain its third spot only. This can be a threat to the business
in the long run as more new players make a foray into the lucrative two-wheeler
market.
28
 Chapter 5
Analysis of Financial statement

29
Financial analysis is the process of evaluating businesses, projects, budgets, and other
finance-related transactions to determine their performance and suitability. Typically,
financial analysis is used to analyze whether an entity is stable, solvent, liquid, or
profitable enough to warrant a monetary investment.
Financial analysis is used to evaluate economic trends, set financial policy, build long-
term plans for business activity, and identify projects or companies for investment. This
is done through the synthesis of financial numbers and data. A financial analyst will
thoroughly examine a company's financial statements—the income statement, balance
sheet, and cash flow statement. Financial analysis can be conducted in both corporate
finance and investment finance settings.
One of the most common ways to analyze financial data is to calculate ratios from the
data in the financial statements to compare against those of other companies or against
the company's own historical performance.
Analyzing through financial statements involves many factors such as solvency,
liquidity, profitability and efficiency of operations is ascertained, thus by identifying the
weakness, the intent is to arrive at an appropriate recommendation and to take an
appropriate decision and to give the forecast for the future of business identity.
There are various types of financial analysis, some of them are mentioned below,

1. External Analysis:
This analysis is done based on the basis of published financial statements by those who
don't have the access to the accounting information, usually it is done by the general
public.

2. Internal Analysis:
This analysis is performed to provide the information to the top management and helping
them to take the decisions and this analysis is done by the finance and accounting
department.

3. Short-term Analysis:
It refers to analysis of both current assets and current liabilities, so that the cash position
(liquidity) may be determined. It is concerned with the analysis of working capital.

4. Horizontal Analysis:
It involves analysis of financial statements for a number of years. Example of this
analysis is Comparative financial statements.

30
5. Vertical Analysis:
Usually it is preferred in situations when the ratios are required to be calculated for only
one year
6. Trend Analysis:
In this kind of analysis, ratios of the different items of the financial statements for the
various period are calculated and comparisons are made accordingly.

7. Ratio Analysis:
It involves developing the meaningful relationship between individual items or group of
items of balance sheets and income statements. It highlights the key performance
indicators such as liquidity, solvency etc.

a) Liquidity Ratio

i. Current Ratio: -

It is the expression of relationship between current assets & current liabilities. This
ratio helps in analysis of short term financial position or liquidity of a firm. It is widely
used because it helps in measure of liquidity of the company.

ii.Quick Ratio: -

The quick ratio helps in measure of company's short term financial liabilities. It’s
also known as the liquid ratio and acid test ratio.

Liquid assets = current assets – prepaid expenses – inventory

Liquid liabilities = current liabilities – bank overdraft- income received in advance.

iii.Total Debt / Equity: -

The debt to equity ratio is one of the leverage ratio that compares a company’s total
liabilities to its total shareholder’s equity. This is a measurement of the percentage of
the company’s balance sheet that is financed by suppliers, lenders, creditors and obligors
versus what the shareholders have committed.

iv.Fixed Asset Ratio: -

31
Fixed Assets ratio is a type of solvency ratio (long-term solvency) which is found by
dividing total fixed assets (net) of a company with its long-term funds. It shows the
amount of fixed assets being financed by each unit of long-term funds.

b) Profitability Ratio: -

These ratios indicate the efficiency with which the operations of the business are carried
on.

1. Net profit Ratio: -

Net profit is a profit after all kinds of direct and indirect expenses. It is calculated net
profit by sales.

Net Profit = Net profit / sales

2. Operating Profit Ratio: -

Operating profit ratio is a measurement of revenue left over after paying for variable
costs of the company such as wages raw materials, etc. it can be computed by operating
profit during a period by net sales during the same period.

3. Earnings Per Share growth (%): -

Earnings per share growth gives a good picture of the rate at which a company has
growth its profitability per unit of equity.

4. Earnings per Share (Rs): -

It measures how many Rupees of net income each share of common has earned stock.
This ratio indicates the availability of total profits per equity shares.

32
1. Net profit Ratio:
The ratio is calculated by dividing net profit by net sales for the concerned period.
Net Profit Ratio = Net Profit *100
Net Sales

YEAR MARCH-16 MARCH-17 MARCH- MARCH- MARCH-20

18 19
NPR 3.72 4.08 4.08 3.59 3.47

NPR
4.2
4.08 4.08
4.1
4
3.9
3.8 3.72
3.7
3.59
3.6
3.47
3.5
3.4
3.3
3.2
3.1
MARCH--16 MARCH--17 MARCH--18 MARCH--19 20-Mar
NPR 3.72 4.08 4.08 3.59 3.47

Interpretation:
From the above graph it clearly tells us that the net profit of the company is decreased
compared to the year 2019 where it was 3.59 and in 2020 it is 3.47.

33
2. Current Ratio
YEAR MARCH-16 MARCH-17 MARCH-18 MARCH-19 MARCH-
20
Current 0.81 0.77 0.68 0.78 0.72
Ratio

Current Ratio (X)

0.85

0.81
0.8
0.78
0.77

0.75
0.72

0.7
0.68

0.65

0.6
16-Mar 17-Mar 18-Mar 19-Mar 20-Mar
16-Mar 17-Mar 18-Mar 19-Mar 20-Mar
Current Ratio (X) 0.81 0.77 0.68 0.78 0.72

Interpretation:
As per the present current ideal ratio 2:1 shows that the company is in a good position.
As per the above table and graph it is identified that in 2019 current ratio has increased
to 0.78 and the year 2020 the ratio has decreased to 0.72

34
 3. Quick ratio or Acid ratio:

YEAR MARCH- MARCH-17 MARCH-18 MARCH-19 MARCH-

16 20
Quick 0.51 0.43 0.43 0.49 0.49
ratio

Quick Ratio (X)

0.52 0.51

0.5 0.49 0.49

0.48

0.46

0.44 0.43 0.43

0.42

0.4

0.38
16-Mar 17-Mar 18-Mar 19-Mar 20-Mar
16-Mar 17-Mar 18-Mar 19-Mar 20-Mar
Quick Ratio (X) 0.51 0.43 0.43 0.49 0.49

Interpretation:
From the above graph the quick ratio is eventually constant compare to PY 2019
where it was 0.49 and in the FY 2020 it is 0.49.

35
4. Inventory turnover ratio:
Inventory turnover is a ratio showing how many times a company has sold and replaced
inventory during a given period. A company can then divide the days in the period by
the inventory.

Inventory turnover Ratio = Cost of goods sold

Average inventories

YEAR MARCH- MARCH- MARCH-18 MARCH- MARCH-

16 17 19 20
ITR 15.95 1255 15.69 15.49 15.81

Inventory Turnover Ratio (X)

20
15.95 15.69 15.49 15.81
15 12.55

10
5
0
16-Mar 17-Mar 18-Mar 19-Mar 20-Mar
16-Mar 17-Mar 18-Mar 19-Mar 20-Mar
Inventory Turnover Ratio
15.95 12.55 15.69 15.49 15.81
(X)

Interpretation:
From the above graph it is clearly telling us that the company have not replaced and
sold the inventories more where ha in PY 2019 it was 15.49 and in the FY 2020 it is
15.81.

36
.
5. Asset turnover ratio:
Asset turnover ratio is the ratio between the value of a company's sales or revenues
and the value of its assets. It is an indicator of the efficiency with which a company is
deploying its assets to produce the revenue.

Asset turnover Ratio = Net sales

Average Total Asset
YEAR MARCH- MARCH- MARCH- MARCH- MARCH-
16 17 18 19 20
ATR 224.23 205.52 210.73 215.57 175.44

Asset Turnover Ratio (%)

250

200

150

100

50

0
16-Mar 17-Mar 18-Mar 19-Mar 20-Mar
16-Mar 17-Mar 18-Mar 19-Mar 20-Mar
Asset Turnover Ratio (%) 224.23 205.52 210.73 217.57 175.44

Interpretation:
From the above graph it explains that the asset value of the company is decreased
compared to PY 2019 where it was 217.57 to 175.44 in FY 2020

37
 6. Operating Profit Ratio:

It determines the relationship between operating profits and sales.

Operating Profit Ratio = EBIT *100

Net Sales

YEAR MARCH- MARCH- MARCH- MARCH- MARCH-

16 17 18 19 20
OPTG- 10.41 12.64 12.84 13.14 11.56
RATIO

OPTG-RATIO
10 9.17
9 8.65
7.78
8
7
5.67 5.75
6
5
4
3
2
1
0
MARCH--16 MARCH--17 MARCH--18 MARCH--19 20-Mar
OPTG-RATIO 5.67 5.75 7.78 8.65 9.17

Interpretation:
From the graph of Operating Profit ratio it tells the company growth has increased
year by year, And in the year 2020 it is reached to 9.17.

38
7. Debt –Equity Ratio:

This ratio shows the relationship between equity funding and debt funding.
Debt-Equity Ratio = Total Long Term Debt
Shareholders’ funds

YEAR MARCH- MARCH- MARCH- MARCH- MARCH-

16 17 18 19 20
DEBT 1.65 1.55 1.60 1.73 2.01
EQUITY
RATIO

DEBT EQUITY RATIO

2
1.81
1.8 1.69

1.6

1.4

1.2
1
1

0.8

0.6
0.39
0.4 0.32

0.2

0
MARCH--16 MARCH--17 MARCH--18 MARCH--19 20-Mar
DEBT EQUITY RATIO 0.39 0.32 1 1.69 1.81

Interpretation:

The above graph shows a high debt equity ratio which indicates that more creditor
financing is used than investor financing where in PY 2019 it was 1.69 which to growth
to 1.81 in FY 2020

39
 8. Debtors Turnover Ratio:
This ratio shows the relation between average accounts receivable and net credits.

Debtors Turnover Ratio = Net Credit Sales

Average account receivable

YEAR MARCH- MARCH- MARCH- MARCH- MARCH-

16 17 18 19 20

DTR 19.68 17.22 16.83 14.26 14.71

DTR
25

19.68
20
17.22 16.83
14.26 14.71
15

10

0
MARCH--16 MARCH--17 MARCH--18 MARCH--19 20-Mar
DTR 19.68 17.22 16.83 14.26 14.71

Interpretation:

From the above graph it tells that the company had highest turnover ratio in the 2016
where it was 19.68 which has continually decreased year by year, in Fy 2020 it is 14.71

40
9. Earnings per Share:
This ratio is calculated to find profitability per share.

Earnings per Share = Net Profit

No. of Equity shares

YEAR MARCH- MARCH- MARCH- MARCH- MARCH-

16 17 18 19 20

EPS 10.3 11.75 13.95 14.11 12.47

EPS
16
13.95 14.11
14 12.47
11.75
12
10.3
10
8
6
4
2
0
MARCH--16 MARCH--17 MARCH--18 MARCH--19 20-Mar
EPS 10.3 11.75 13.95 14.11 12.47

Interpretation:
The above graph tells that the earning per share is increased in the year 2019 to
14.11 and decreased in the year 2020 to 12.47 .

41
10. Proprietary Ratio:

This ratio establishes the relationship between proprietors’ funds and the total assets
of the business.
Proprietary Ratio = Proprietors funds
Total Assets
YEAR MARCH-16 MARCH-17 MARCH- MARCH- MARCH-
18 19 20

PR 0.86 0.91 0.83 0.81 0.71

Prop-ratio
1 0.91
0.9 0.86 0.83 0.81
0.8 0.71
0.7
0.6
0.5
0.4
0.3
0.2
0.1
0
MARCH--16 MARCH--17 MARCH--18 MARCH--19 20-Mar
Prop-ratio 0.86 0.91 0.83 0.81 0.71

Interpretation:

The graph clearly indicates high proprietary ratio which means that assets are mainly
funded using shareholders money.

42
 CHAPTER-6
LEARNING EXPERIENCE

The organization study on TVS has helped me to know the functioning of different
departments that would allow me to expand my career options. I found it difficult in the first
few days as there was no interaction possible with the company officials and had to work
on my own. This one month organizational study as exposed me to various aspects of
business. This helped me to get a clear idea about the functioning of the organization.

The main objective of the study was to understand the working of the organization.

 It has covered the aspects like Background, Nature of business, Vision, Mission,
Quality policy, Product profile, Organization structure, Achievements and Future
growth.
 This study has helped me to understand the Mckinsey’s 7S framework with reference
to TVS
 I was able to understand the company’s strengths, weakness, opportunities and
threats through the SWOT analysis.
 The study has assisted me to know about the real financial practices at TVS through
the analysis of financial statement using techniques such as comparative analysis
and ratio analysis.

43
 CHAPTER-7
BIBLIOGRAPHY

https://www.marketing91.com/
https://en.wikipedia.org/wiki/TVS_Motor_Company
https://www.moneycontrol.com
https://www.tvsmotor.com/

44
 Annexure
Balance Sheet of TVS Motor Company (in Rs. Cr.)

Annual 20-Mar 19-Mar 18-Mar 17-Mar 16-Mar

12 mths 12 mths 12 mths 12 mths 12 mths
EQUITIES AND LIABILITIES
SHAREHOLDER'S FUNDS
Equity Share Capital 47.51 47.51 47.51 47.51 47.51
Total Share Capital 47.51 47.51 47.51 47.51 47.51
3,570.5 3,299.8 2,832.9 2,360.8 1,910.8
Reserves and Surplus 8 1 1 2 3
3,570.5 3,299.8 2,832.9 2,360.8 1,910.8
Total Reserves and Surplus 8 1 1 2 3
3,618.0 3,347.3 2,880.4 2,408.3 1,958.3
Total Shareholders Funds 9 2 2 3 4
NON-CURRENT
LIABILITIES
Long Term Borrowings 904.63 709.12 317.62 468.76 494.23
Deferred Tax Liabilities [Net] 158.05 212.63 148.17 125.7 143.74
Other Long Term Liabilities 85.79 0 0 0 0
Long Term Provisions 83.4 58.61 53.76 50.8 39.99
1,231.8
Total Non-Current Liabilities 7 980.36 519.55 645.26 677.96
CURRENT LIABILITIES
1,070.0
Short Term Borrowings 0 668.82 719.35 616.38 264.23
2,886.3 2,923.9 2,517.9 1,859.3 1,543.7
Trade Payables 9 0 9 6 1
Other Current Liabilities 461.96 389.31 480.14 312.47 449.47
Short Term Provisions 92.85 59.65 62.02 62.87 58.47
4,511.2 4,041.6 3,779.5 2,851.0 2,315.8
Total Current Liabilities 0 8 0 8 8
9,361.1 8,369.3 7,179.4 5,904.6 4,952.1
Total Capital And Liabilities 6 6 7 7 8
ASSETS
NON-CURRENT ASSETS
2,723.2 2,526.2 2,315.4 1,930.6 1,672.6
Tangible Assets 1 9 6 4 7
Intangible Assets 176.73 53.02 56.41 53.23 46.92
Capital Work-In-Progress 126.56 116.64 91.74 62.28 30.96
Other Assets 0 0 0 0 0
3,185.3 2,836.5 2,503.0 2,046.1 1,750.5
Fixed Assets 7 4 0 5 5
2,605.8 2,300.6 2,035.3 1,587.9 1,214.8
Non-Current Investments 8 7 8 0 6
Deferred Tax Assets [Net] 0 0 0 0 0

45
Long Term Loans And
Advances 0 0 0 0 55.3
Other Non-Current Assets 340.48 77.25 62.98 83.73 45.1
6,131.7 5,214.4 4,601.3 3,717.7 3,065.8
Total Non-Current Assets 3 6 6 8 1
CURRENT ASSETS
Current Investments 0 0 0 0 0
1,038.9 1,175.9
Inventories 3 4 964.39 966.95 696.33
1,281.3 1,414.1
Trade Receivables 6 4 968.37 723.77 578.03
Cash And Cash Equivalents 419.17 43.86 10.9 8.51 32.74
Short Term Loans And
Advances 0 0 0 0 0
OtherCurrentAssets 489.97 520.96 634.45 487.66 579.27
3,229.4 3,154.9 2,578.1 2,186.8 1,886.3
Total Current Assets 3 0 1 9 7
9,361.1 8,369.3 7,179.4 5,904.6 4,952.1
Total Assets 6 6 7 7 8
OTHER ADDITIONAL
INFORMATION
CONTINGENT LIABILITIES,
COMMITMENTS
Contingent Liabilities 375.27 568.44 500.84 622.69 332.17
CIF VALUE OF IMPORTS
Raw Materials 0 0 0 0 0
Stores, Spares And Loose Tools 0 0 0 0 0
Trade/Other Goods 0 0 0 0 0
Capital Goods 0 0 0 0 0
EXPENDITURE IN FOREIGN
EXCHANGE
Expenditure In Foreign 1,723.0 2,791.0 1,942.5
Currency 0 0 2 0 0
REMITTANCES IN FOREIGN
CURRENCIES FOR DIVIDENDS
Dividend Remittance In Foreign
Currency -- -- -- -- --
EARNINGS IN FOREIGN
EXCHANGE
2,885.8
FOB Value Of Goods -- -- 1 -- --
4,579.0 4,141.0
Other Earnings 0 0 -- -- --
BONUS DETAILS
Bonus Equity Share Capital 23.75 23.75 23.75 23.75 23.75
NON-CURRENT
INVESTMENTS

46
 Non-Current Investments
Quoted Market Value 33.23 72.27 82.51 71.53 38.85
Non-Current Investments 2,572.6 2,228.4 1,952.8 1,516.3 1,176.0
Unquoted Book Value 5 0 7 7 1
CURRENT INVESTMENTS
Current Investments Quoted
Market Value -- -- -- -- --
Current Investments Unquoted
Book Value -- -- -- -- --

Profit & Loss account of TVS Motor Company (in Rs. Cr.)

Annual 20-Mar 19-Mar 18-Mar 17-Mar 16-Mar

12 mths 12 mths 12 mths 12 mths 12 mths
INCOME
Revenue From Operations
[Gross] 16,073.63 17,912.51 15,310.00 13,063.82 11,953.30
Less: Excise/Sevice
Tax/Other Levies 0 0 343.22 1,054.75 986.26
Revenue From Operations
[Net] 16,073.63 17,912.51 14,966.78 12,009.07 10,967.04
Total Operating Revenues 16,423.34 18,209.92 15,129.66 12,135.31 11,104.66
Other Income 32.1 7.54 144.78 173.37 103.85
Total Revenue 16,455.44 18,217.46 15,274.44 12,308.68 11,208.51
EXPENSES
Cost Of Materials
Consumed 11,854.80 13,672.80 10,909.92 8,620.88 7,657.23
Operating And Direct
Expenses 0 0 0 0 0
Changes In Inventories Of
FG,WIP And Stock-In
Trade 21.93 -75.37 -31.34 -58.73 70.53
Employee Benefit Expenses 938.41 922.63 868.01 745.64 652.39
Finance Costs 102.19 80.56 56.62 43.95 48.73
Depreciation And
Amortisation Expenses 489.03 399.27 338.73 287.81 236.05
Other Expenses 2,003.14 2,011.77 1,999.45 1,679.23 1,663.23
Total Expenses 15,668.70 17,256.50 14,395.80 11,610.00 10,579.57
Profit/Loss Before
Exceptional, ExtraOrdinary
Items And Tax 786.74 960.96 878.64 698.68 628.94
Exceptional Items -32.33 0 0 0 0
Profit/Loss Before Tax 754.41 960.96 878.64 698.68 628.94
Tax Expenses-Continued Operations
Current Tax 233.9 276.76 197.06 159.78 122.11
Less: MAT Credit
Entitlement 0 0 0 0 0
47
Deferred Tax -71.74 14.06 18.99 -19.18 17.55
Tax For Earlier Years 0 0 0 0 0
Total Tax Expenses 162.16 290.82 216.05 140.6 139.66
Profit/Loss After Tax And
Before ExtraOrdinary Items 592.25 670.14 662.59 558.08 489.28
Profit/Loss From
Continuing Operations 592.25 670.14 662.59 558.08 489.28
Profit/Loss For The Period 592.25 670.14 662.59 558.08 489.28
OTHER ADDITIONAL
INFORMATION
EARNINGS PER SHARE
Basic EPS (Rs.) 12.47 14.11 13.95 11.75 10.3
Diluted EPS (Rs.) 12.47 14.11 13.95 11.75 494.23
VALUE OF IMPORTED AND INDIGENIOUS RAW MATERIALS STORES, SPARES
AND LOOSE TOOLS
Imported Raw Materials 0 0 0 0 0
Indigenous Raw Materials 0 0 0 0 0
STORES, SPARES AND LOOSE
TOOLS
Imported Stores And Spares 0 0 0 0 0
Indigenous Stores And
Spares 0 0 0 0 0
DIVIDEND AND
DIVIDEND
PERCENTAGE
Equity Share Dividend 166.28 166.28 156.78 118.78 173.41
Tax On Dividend 33.75 33.7 30.85 22.51 33.07
Equity Dividend Rate (%) 350 350 330 250 250

48