CERTIFICATE OF ORIGINALITY

This is to certify that the project titled “FINANCIAL PERFORMANCE OF IOCL” is

an original work of Shruti Goel and is being submitted in partial fulfillment for the

award of the Master’s Degree in Business Administration of School of Management

Studies, Indira Gandhi National Open University. This report has not been submitted

earlier either to this University or to any other University/Institution for the fulfillment

of the requirement of a course of study.

SIGNATURE OF GUIDE SIGNATURE OF STUDENT

Place : Place :

Date : Date :

1
 A
PROJECT REPORT ON

FINANCIAL PERFORMANCE OF IOCL

Submitted By:

Shruti Goel

Enrollment No: 189442565

Under The Guidance Of:

Mr. Raj Sharma

Submitted To:

INDIRA Gandhi National Open University

In partial fulfillment for the award of the Master’s Degree in Business

Administration (Finance)
This is to acknowledge all those who have helped me a lot in preparing this project report. I
am highly obligated to Mr. A.K Agnihotri, CM (Training Development), Indian Oil
Corporation Ltd. who gave me official permission to undergo training.

My sincere thanks to Mr. Manish Aggarwal Senior Accounts Officer, Finance Department,
under whose supervision I completed my summer training project. He guided me throughout
my training and helped me in finishing my project report sincerely.

I would also like to pay my gratitude to all the members of finance department at Indian Oil
Corporation for their cooperation they extended without which I would never have been able
to come to a good end of my project work. I also pay my highest regards to Mr. Sahai, Senior
accounts Officer without whose mention, and the acknowledgement would be incomplete. .

I would also like to pay my sincere gratitude to Raj Sharma who guided me throughout my
training programme.

3
 INDEX

1. Introduction to IOCL
i. Profile of IOCL ………………………………… 6
ii. Objectives & Obligation of IOCL ……………………16
iii. Vision & Mission …………………………………17
iv. Products …………………………………22

2. Introduction to Panipat Refinery

i. Highlights of Panipat Refinery …………………...28
ii. The Eco-Friendly Refinery ……………………30
iii. Departments …………………………………33

3. Ratio Analysis ……………………………………….35

4. Research Methodology ……………………………………….57
5. Finding & Conclusion ……………………………………….59
6. Annexure ………………………………………………74
7. Bibliography ………………………………………………78

4
INTRODUCTION

5
 Profile of IOCL

Indian Oil Corporation Limited

Indian Oil Corporation Ltd. (Indian Oil) was formed in 1964

through the merger of Indian Oil Company Ltd. (Est. 1959)

and Indian Refineries Ltd. (Est. 1958).

It is currently India’s largest company by sales with a turnover

of Rs. 1,83,204 crore and profits of Rs. 4,915 crore for fiscal 2019-20.

Indian Oil is also the highest ranked Indian company in the

Fortune ‘Global 500’ listing, at 153rd position. It is also the

21st largest petroleum company in the world and the # 1

petroleum trading company among the national oil

companies in the Asia-Pacific region.

India’s Downstream Major

6
The Indian Oil Group of companies owns and operates 10 of India’s 18 refineries with a

combined refining capacity of 60.20 million tones per annum (1.2 million barrels per day).

These include two refineries of subsidiary Chennai Petroleum Corporation Ltd. (CPCL) and

one of Bongaigaon Refinery and Petrochemicals Limited (BRPL). Indian Oil owns and

operates the country’s largest network of cross-country crude oil and product pipelines

spanning nearly 9,000 kilometers, with a combined capacity of 60.42 MMTPA.

Indian Oil and its subsidiaries account for 44.50% petroleum products market share among

public sector oil companies, 42% national refining capacity and 69% downstream pipeline

throughput capacity.

For the year 2019-20, Indian Oil sold 49.61 million tones of petroleum products, including

2.09 million tones through exports.

To maintain its competitive edge and leadership status, Indian Oil is investing Rs. 24,000

crore (US $ 5.6 billion) during the X Plan Period (2002-07) in integration and diversification

projects, besides refining and pipelines capacity augmentation, product quality up gradation

and retail expansion.

Network Beyond Compare

As the flag-ship national oil company, Indian Oil’s countrywide network of 24,000 sales

points is backed for supplies by 158 bulk storage depots and terminals, 95 aviation fuel

stations and 88 Indane LPG bottling plants. Its subsidiary, IBP Co. Ltd., is a stand-alone

marketing company with a nationwide network of nearly 4000 retail sales points.

7
Indian Oil reaches Indane cooking gas to the doorsteps of 41.05 million households in 2,353

markets through a network of nearly 4,700 Indane distributors.

Indian Oil also operates the largest and the widest network of

retail outlets (petrol/diesel stations) in the country. A

significant milestone was achieved with the commissioning of

the company’s 10,000th petrol station during the year 2014-

15. Indian Oil’s SERVO brand lubricants, being the first and

only one in its category in India to be accorded ‘Super brand’

status, is the country's leading, with over 42% market share

and 450 grades. SERVO lubricants are sold through over 10,000 Company retail outlets,

besides a countrywide network of bazaar traders.

Indian Oil’s ISO-9002 certified Aviation Service commands a 65% market share in aviation

fuel business, meeting the fuel needs of domestic and international flag carriers, private

airlines and the Indian Defence Services.

Customer First

At Indian Oil, customer is the first priority. During 2018-19, a slew of initiatives were

launched for the convenience and benefit of the various customer segments. Branded auto-

fuels (XtraPremium petrol and XtraMile diesel) market was expanded to cover more retail

outlets across the country. Exclusive XtraCare retail outlets were unveiled in select urban and

semi-urban markets during the year 2018-19, offering a range of services to enhance

customer delight and loyalty.

8
Similarly, to meet the discerning needs of highway

motorists, large format Swagat brand retail outlets were

launched during the year with multiple facilities such as

food courts, first aid, and dormitories for drivers and

cleaners, repair and spare part shops etc.

Specially formatted retail outlets - Kisan Sewa Kendras – were also launched during the year

2019-20 to meet the diverse needs of rural customers were launched during the year. These

outlets were strategically positioned to offer product and services such as fertilizers, seeds,

pesticides, farm equipment, medicines, spare parts for trucks and tractors, tractor engine oils

and pump set oils besides auto fuels and kerosene.

R&D for Growth

Indian Oil’s world class R&D Center is perhaps Asia’s finest. Besides pioneering work in

lubricants formulation, refinery processes, pipeline transportation and alternative fuels such

as bio-diesel, the Center is also the nodal agency of the Indian hydrocarbon sector for

ushering in Hydrogen fuel in the country.

Expanding Horizons

Indian Oil has set its sight to reach US$ 60 billion revenues by the next five years from

current earnings of US$ 34.44 billion. The road map to attain this milestone has been laid

through vertical integration – forward into petrochemicals and backwards into exploration

and production of crude oil, besides diversification into natural gas business and globalization

of our operations.

9
In petrochemicals, a master plan envisaging Rs. 25,000 crore (US$ 5.7 billion) investment is

already underway. The commissioning of the world’s largest single train Linear Alkyl

Benzene plant at Koyali refinery and the on-going integrated Paraxylene/Purified

Terephthalic Acid (PX/PTA) plant and a world-scale Naphtha Cracker with downstream

polymer projects are part of this plan. Indian Oil also proposes to convert the on-going

Paradip refinery into a refinery-cum-petrochemicals complex to strengthen its presence in the

sector.

In exploration & production (E&P), Indian Oil has participated in the first three rounds of

NELP (New Exploration Licensing Policy) in India, in consortium with other companies, and

was awarded 11 exploration blocks. It has acquired participating interest in on-shore blocks

in Assam and Arunachal Pradesh region. Overseas ventures include 2 blocks in Sirte Basin in

Libya and Farsi Exploration Block in Iran. The Corporation is also exploring opportunities to

acquire a suitable medium-sized E&P company to quickly consolidate its upstream operations.

In natural gas business, Indian Oil is already marketing 5.26 MMSCMD (million metric standard

cubic meters per day) of gas. To augment its business in the sector, it has now finalized an import deal

for 1.75 million tones of LNG per annum with Iran for supplies. The Corporation has also proposed

partnering Petropars; a subsidiary of National Iranian Oil Company, in jointly developing gas blocks

in the North Pars fields of Iran.

10
Transnational Presence

To emerge as a transnational energy major, Indian Oil has set up offices in Sri Lanka,

Mauritius and UAE and is simultaneously scouting new opportunities in new energy markets

in Asia and Africa.

The Sri Lankan subsidiary, Lanka IOC, operates 170 retail outlets commanding a 27%

market share. Its oil terminal at Trincomalee is also Sri Lanka’s largest petroleum storage

facility.

Indian Oil Mauritius Ltd. has garnered a 7% market share in the very first year of its

operation. It also operates a modern petroleum bulk storage terminal at Mer Rouge port,

besides five retail outlets. A modern product testing laboratory and expansion of retail

network has also been proposed in Mauritius.

Indian Oil’s Regional Office in Dubai, which is coordinating business expansion in the

Middle East, has commenced blending of SERVO lubricants through contract blending

arrangements for the first time recently.

Synergy through Subsidiaries

A wholly owned subsidiary Indian Oil Technologies Ltd. has been established for

commercializing the innovations and technologies developed by the R&D Center across the

globe. The merger of Indian Oil Blending Ltd with the parent company, now approved by the

Government, is in the final stages of implementation.

11
The merger of IBP Co. Ltd., retail focused subsidiary with a network of 4,000 retail outlets,

with the parent company is awaiting the Government’s nod after its approval by the Boards

of Indian Oil and IBP. On Government’s approval, other statutory approvals, including

shareholder’s approval, would be sought to complete the merger at the earliest.

The merger of Bongaigaon Refinery and Petrochemicals Ltd. with the parent company has

also been mooted with the respective Boards approving the same already. Other formalities,

including Government’s nod, would be sought in due course.

Spreading Wings

The Corporation has launched several joint ventures in partnership with some of the most

respected Corporate from India and abroad -- Lubrizol, Nyco SA, Petronas, Oil tanking

GmbH, Marubeni, to name a few. SERVO lubricants are being marketed in Dubai, Nepal,

Bhutan, Kuwait, Malaysia, Bahrain, Indonesia, Sri Lanka, Kyrgyzstan, Mauritius,

Bangladesh, etc.

Indian Oil has been lending its expertise for nearly two decades to various countries in

several areas of refining, marketing, transportation, training and research & development.

These include Sri Lanka, Kuwait, Bahrain, Iraq, Abu Dhabi, Tanzania, Ethiopia, Algeria,

Nigeria, Nepal, Bhutan, Maldives, Malaysia, Sudan and Zambia.

Indian Oil’s sincere commitment to Quality, Safety, Health and Environment is reflected in

the series of national and international certifications and awards earned over the years.

The 18th largest petroleum Company in the world, Indian Oil is well on its way to becoming

an integrated, transnational energy corporate.

12
 Present Position of IOCL

Indian oil is the largest commercial undertaking in India, engaged in the business of refining,
transportation and marketing of petroleum products throughout the country. It is the only
Indian company in the fortune’s global 500 listing of the world’s largest industry and service
companies.

Indian oil owns and operates more than half of refineries available in INDIA with a total
refining capacity of 31.70 million tones per annum which is 44.4% of the total installed
refining capacity of the country. Indian oil board has also approved the expansion of Cauvery
basin refinery at Nagapattinam to 9 MMTPA as a joint venture with Madras refineries limited
(MRL).

Before taking Panipat refinery, into operation, all six refineries of Indian oil achieved ISO –
9002 and ISO –14001 accreditation. Mathura refinery has the unique distinction of being the
first oil refinery in the world to receive occupational health and safety management system
(OHSMS) certification.

Indian oil’s quality initiatives have led to over 60 units earning ISO –9001/9002/14001
accreditations.

Indian oil has largest network of 6268 km cross-country pipeline for economical, reliable and
ecofriendly mode of transportation of crude oil and petroleum products.
Indian oil has vast marketing network, spread all over the country, with 55% share. It also
imports crude oil and major petroleum products on behalf of oil industry.

Indian oil has world class R&D center at Faridabad, Haryana, which has contributed
significantly in the development and indigenization of lubricant formulation and also in
process optimization, additives and catalysts in petroleum refining.

Indian oil nurtures the vision of becoming an integrated and diversified global energy
corporation. It is augmenting infrastructure and harnessing new business opportunities in

13
petrochemicals, power lube marketing, R&D, training and consultancy, exploration&
production, LNG and fuel management in India and aboard. SERVO lubricants have been
exported to Nepal, Bhutan, UAE, Kuwait and Srilanka. Three offices have been opened at
Kuala Lumpur, Kuwait and Dubai to coordinate and explore business opportunities.

India’s flagship national Oil Company

As the flagship of National oil company, IOC’s countrywide network of 24000 sales points
and is backed for supplies by 158 bulk storage depots and terminals, 95 aviation fuel stations
and 88 Indane LPG bottling plants. Its subsidiary, IBP Company Ltd., is a stand-alone
marketing company with a nationwide network of nearly 4000 retail sales points.
Indian oil also operates the largest and the widest network of retail outlets in the company.

Countrywide Network

India Oil’s countrywide network of over 22,000 sales points is backed for supplies by its
extensive, well spread out marketing infrastructure comprising 165 bulk storage terminals,
installations and depots, 95 aviation fuelling stations and 87 LPG bottling plants.

Its subsidiary, IBP Co. Ltd, is a stand-alone marketing company with a nationwide network
of over 3,000 retail sales points

For the year 2019-20, Indian oil sold 50.1 million tones of petroleum products, including
exports of 1.96 million tones. Its seven own refineries achieved a throughput of 36.63 million
tones, and the pipeline network transported 43.03 million tones of crude oil and petroleum
products. Customer Care

Customer delight is the Key driver of Indian oil’s marketing operations. Under the EXTRA
retail outlet brand unveiled during 2018-19, Indian oil is making customers visiting its petrol
and diesel stations a number of EXTRA offerings, including assured quality and quantity,
efficient forecourt service and high levels of housekeeping, choice of regular and branded

14
fuels, 100% electronic dispensing, cashless transactions, loyalty programs for cash & credit
customers, and a number of non-fuel offerings tailor-made to customer profile and
requirements.

ACADEMY COMPANY

Indian oil is an “academy” company with a score of full-fledged training centers across the
country building skills and competencies among Indian Oil People to face the challenges of
the market place. Among these, the Indian Oil Institute of Petroleum Management (IIPM) at
Gurgaon, the Indian Oil Management center for learning at Mumbai, and the Indian Oil
Management Academy at Haldia have emerged as world-class training and management
academies.

Pioneering R&D

Indian oil’s world-class R&D Center has won recognition for its pioneering work in
lubricants formulation, refinery processes, pipeline transportation and alternative fuels. It has
developed over 2,100 formulations of SERVO brand lubricants and greases for virtually all
conceivable applications-automotive, railroad, industrial and marine-meeting stringent
international standards and bearing the stamp of approval of all major original equipment
manufacturers.

A wholly owned subsidiary company, Indian Oil Technologies Ltd., is commercializing the
innovations and technologies of the center, which has over 140 national and international
patents to its credit. Apart from leadership in development and commercialization of bio-
fuels, the R&D Center is currently the nodal agency of the hydrocarbon sector in India for
ushering in Hydrogen fuel in the Country.

15
OBLIGATIONS

Towards customers and dealers

 To provide prompt, courteous and efficient service and quality products at fair and
reasonable prices.

Towards suppliers
 To ensure prompt dealing with integrity, impartiality and courtesy and promote
ancillary industries.

Towards employees
 Develop their capability and advancement through appropriate training and career
planning.
 Expeditious redressal of grievances
 Fair dealing with recognized representatives of employees in pursuance of healthy
trade union practices and sound personnel policies.

Towards community
 To develop techno-economically viable and environment friendly products for the
benefits of the people.
 To encourage progressive indigenous manufacture of products and materials so as to
substitute imports.
 To ensure safety in operations and highest standards of environment protection in its
manufacturing plants and townships by taking suitable and effective measures.

Towards Defense Services

 To maintain adequate supplies to defense services during normal and emergency

situations as per their requirements at different locations.

16
 Vision

 A major diversified, transnational, integrated energy company, with national

leadership and a strong environment conscience, playing a national role in oil
security& public distribution.

Mission

 To achieve international standards of excellence in all aspects of energy and

diversified business with focus on customer
 delight through value of products and services, and cost reduction.
 To maximize creation of wealth, value and satisfaction for the stakeholders.
 To attain leadership in developing, adopting and assimilating state-of- the-art
technology for competitive advantage.
 To provide technology and services through sustained Research and Development.
 To foster a culture of participation and innovation for employee growth and
contribution.
 To cultivate high standards of business ethics and Total Quality Management for a
strong corporate identity and brand equity.
 To help enrich the quality of life of the community and preserve ecological balance
and heritage through a strong environment     conscience.

17
REFINERIES OF IOCL

Indian Oil controls 10 of India's 18 refineries with a current combined rated capacity of
54.20 million metric tones per annum (MMTPA)* (one million barrels per day). Indian Oil
refineries registered a record throughput of 36.63 million tones during the year 2019-20 with
a capacity utility of 88.6%.

All refinery units are accredited with ISO 9002 and ISO 14001 certifications.

* (MMTPA- Million metric tones per annum, equal to 20,000 barrels per day)
* Million British Thermal Unit/ Per Barrel Energy Factor

Indian Oil Refineries& It’s Subsidiaries

1. DIGBOI REFINERY
2. GUWAHATI REFINERY
3. BARAUNI REFINERY
4. GUJRAT REFINERY
5. HALDIA REFINERY
6. MATHURA REFINERY
7. PANIPAT REFINERY
8. CHENNAI PETROLEUM CORPORATION LTD. (CPCL)
9. BONGAIGAON REFINERY& PETROCHEMICALS LTD.

Digboi refinery

18
The Digboi Refinery in North Eastern India is India’s oldest refinery and was commissioned
in 1901. Originally a part of Assam Oil Company, it became part of Indian oil in 1981.

Its original refining capacity had been 0.5 MMTPA. Modernization project of this refinery
has been completed and the refinery now has an increased capacity of 0.65 MMTPA. The
Digboi refinery produces distillates, heavy ends and excellent quality wax from indigenous
crude oil produced at the Assam oil fields. Petroleum products are supplied mainly to
northeastern India primarily through road and rail wagons.

A new Delayed coking unit of 1,70,000 TPA capacity was commissioned in 2018. A new
solvent Dewaxing Unit for Maximizing production of microcrystalline wax was installed and
commissioned in 2018.

Guwahati refinery

The Guwahati Refinery in Northeast India _the first public Sector refinery of the country was
commissioned in 1962 with a capacity of 0.75 MMTPA, which was subsequently increased,
to 1.0 MMTPA through the bottlenecking projects.

The refinery processes only indigenous crude oil from the Assam oil fields. With its main
secondary unit, a coking unit, it produces middle distillates from heavy ends and supplies
petroleum products to North-Eastern India, and surplus products onward to Siliguri in West
Bengal. Hydro Unit for improving the quality of diesel has been installed and was
commissioned in 2002. The refinery has also installed in 2013 a novel technology developed
by its R&D Center for upgrading heavy ends into LPG, Motor Spirit and Diesel oil.

Barauni refinery
The Barauni Refinery in Eastern India was commissioned in 1964 with a capacity of 2.0
MMTPA. The refining capacity was increased to 3.0 MMTPA by 1969 and further to its
current capacity of 6.0 MMTPA through low cost revamping and debottlenecking.

19
Matching secondary processing facility such as RFCC (Reside Fluidized Catalytic Cracker)
and facilities for diesel quality improvement has been added. Earlier, refinery’s crude input
was primarily from the Assam oil fields through pipeline. With the commissioning of the
6.0Mmtpa Haldia-Barauni crude oil pipeline, the refinery now receives imported crude for
processing. A CRU (Catalytic Reformer Unit) was also added to the refinery in 2017 for
production of unleaded motor spirit. Projects are also planned for meeting future fuel quality
requirements. Barauni Refinery supplies distillate products besides eastern India to northern
India through a product pipeline to Kanpur in Uttar Pradesh.

Gujarat refinery

The Gujarat Refinery at Koyali in Gujarat in Western India is Indian Oil’s largest refinery.
The refinery was commissioned in 1965. Its facilities include five atmospheric crude
distillation units. The major units include CRU, FCCU and the first Hydro cracking unit of
the country. Through a product pipeline to Ahmedabad and a recently commissioned product
pipeline connecting to BKPL product pipeline and also by rail wagons/trucks, the refinery
primarily serves the demand for petroleum products in western and northern India.

Haldia refinery
The Haldia refinery, in Haldia, West Bengal in Eastern India was commissioned in January
1975. The refinery had an original capacity of 2.5 MMTPA. Petroleum products from this
refinery are supplied mainly to Eastern India through two product pipelines as well as
through rail wagons and tank trucks.

This refinery also produces Lube Oil Base Stock (LOBS). Capacity of this refinery was
increased to 2.75 MMTPA through debottlenecking in 1989-90. Further increase to 4.75
MMTPA by installation / commissioning of a new Crude Distillation Unit of 1.0 MMTPA
capacity was carried out in 1997. A DHDS unit has been commissioned in the refinery for
production of HSD with low Sulphur content of 0.25% wt (max).

A RFCC unit and a Vacuum Distillation unit to meet the high demand for middle distillates,
such as diesel and LPG were added in 2011. The facilities for production of Bitumen

20
emulsion and microcrystalline wax have already been commissioned. In addition, a Catalytic
Dewaxing Unit was installed and commissioned in 2013, for production of high quality Lube
Oil Base Stock (LOBS). In order to meet future fuel quality requirements, MS Quality
improvement facilities has been installed by 2019. The present capacity of the refinery is 4.60
MMTPA, which has been achieved through minor modifications.

Mathura refinery

The Mathura refinery was commissioned in 1982 with an original capacity of 6.0 MMTPA.
The capacity was increased to 7.5 MMTPA by debottlenecking and revamping. With its fluid
catalytic cracking units, the refinery mainly produces middle distillates and supplies them to
Northern India through a product pipeline to Jalandhar, Punjab via Delhi.

The company commissioned a two-stage desalter in 1998 for improving the on-stream
availability of the crude distillation unit and a CCRU for production of unleaded Motor
Spirit. A DHDS Unit was commissioned for production of HSD with low Sulphur content of
0.25% wt (max). A hydro-cracker for increasing middle distillates was also completed in
2009. The present capacity of the refinery is 8 MMTPA. In order to meet future fuel
requirements, facilities for improvement in quality of MS and HSD are also completed.

Panipat refinery

Indian oil’s seventh refinery, commissioned in 1998, is located at Panipat, 125 Kms away
from Delhi, and the capital of India, in the state of Haryana in Northern India. The main units
are OHCU (Once-through-hydro cracker), RFCC, CCRU (Continuous Catalytic Reformer
Unit) besides other secondary treatment units. This 6 MMTPA refinery caters to the high
demand centers of North India. A DHDS unit for production of low sulphur HSD was added
in July 1999- the second such unit also commissioned in the country for production of HSD
with low Sulphur content of 0.25% wt (max).

21
 BRANDS

Indian Oil’s SERVO: Indian Oil’s Global Brand.

SERVO is India's largest selling lubricant brand.
SERVO range of lubricants enjoys approvals from
major Original Equipment Manufacturers (OEMs)
including new generation cars. 9,000 Retail Outlets and
a countrywide network of SERVO SSls and SSAs Bazaar traders offer SERVO range of
lubricants to customers.

The SERVO range of lubricants is used in almost every application covering automotive,
industrial and marine sectors. SERVO range of lubricants is fast emerging as a Global Brand
with wide acceptance in UAE, Malaysia, Mauritius, Bangladesh, Bahrain, Sri Lanka, Nepal,
Yemen, Kenya, Kuwait, Burkina Faso, Reunion Islands and other markets. SERVO has been
designated as a SUPERBRAND. SERVO has genuine oil tie ups with a wide range of
companies like Hyundai, Maruti, Bajaj, and Lancer. Anil Kumble, the ever-dependable
sporting icon is SERVO Brand Ambassador.

Developed exclusively at Indian Oil’s world-class R&D Center at Faridabad, there is a

SERVO lubricant for virtually every single application. With over 42% market share and 450
grades, the country's leading SERVO brand lubricants from Indian Oil are sold through over
8,100 Indian Oil petrol/diesel stations, over 1,300 SERVO Shops and a countrywide network
of bazaar traders.

Indian Oil Indane LPG as is used in 60 Million homes as cooking fuel and commands over
48% market share in India. Indane LPG as is marketed through a network of 4350 Indane
distributors. Widely used in commercial sectors like industries, hotels & restaurants, medical
labs, etc. 87 Indane Bottling Plants are spread across the country with a combined bottling
capacity of 3.77 MMTPA.

22
New and convenient 5 kg Indane LPG as cylinders introduced in rural and hilly regions for
wider use by economically weaker sections. Indian Oil’s auto LPG brand Auto gas is the
leader in the segment. Marketed through a network 48 stations out of an industry total of 103
Auto LPG Dispensing Stations.

Meets complete Aviation Fuel requirements of the Defense Services and for over 75
Domestic and International airlines besides private aircraft operators. Indian Oil Aviation
Services 9002 certified and entrusted with WIP refueling for national and overseas
dignitaries. Indian Oil’s prompt, courteous and 'No-Delay' Aviation Fuel Service has received
accolades from major customers. Always on call for providing services in exigencies of war
and peace.

Indian Oil Aviation Services has a market share of 65% with a network of 95 Aviation Fuel
Stations (AFS) Indian Oil Aviation Services is not only the largest aviation fuel marketer in
the country but also the most preferred supplier of js ISOet fuel for customers in India and
abroad. Indian Oil Aviation Services serves over 71 International airlines besides the
domestic airlines in India. From Thiruvananthapuram in the South, to Leh in the North. From
Porbandar in the West to Ziro in the East.

Indian Oil Aviation Services covers India like no one else. In fact, every 1.6 minutes, an
aircraft is being refueled by Indian Oil Aviation Services, somewhere in the country. It also
caters to over 90% demand of the Indian Defence services, besides the sensitive requirements
of WIP flights at all the airports and at remote helipads/helibases across the Indian
subcontinent. Indian Oil Aviation Services not only maintains world-class standards in
operations and safety but also conforms to the stringent global quality requirements of

Aviation Fuel Storage And Handling.

Presently, Indian Oil has earned this accreditation for
thirteen major Aviation Fuel Stations including at all
international airports. Eleven of the fourteen quality
control laboratories have also earned this accreditation.
Indian Oil is also the first in India to have adopted a

23
Quality Control Index System based on a quality audit. Fourteen DGCA approved Indian Oil
laboratories spread across the country carry out full specification tests for Aviation Fuels.

Indian Oil’s Aviation Services, with 68% market share, meets the fuel and lubricants needs of
domestic and international flag carriers, Defence Services and private aircraft operators
through 93 aviation-fuelling stations. Between one sunrise and the next, Indian Oil refuels
over 900 aircrafts. In fact, the refueling never stops and neither does our customer service,
which is round the clock. The wing’s foreign exchange earnings during the year 2019-20
touched Rs. 1898 crore.

Auto gas (LPG) has been introduced in Hyderabad, Bangalore and Mumbai markets. This
alternative fuel is a good business proposition in the long term, and Indian Oil intends to
further expand its marketing in a big way.

 Indian Oil offers XtraPemium Petrol and

XtraMile Diesel, which are the best your vehicle
can get. India's first 91 Octane petrol,
XtraPremium is reinforced with multifunctional additives including 'Friction
Buster'. Available at nearly 2000 Retail Outlets nationwide, XtraPremium offers :

Super Mileage and Super Pick-up

Enhances cleaning of engines
Minimizes exhaust emissions
Restores peak engine power and acceleration
Reduces maintenance cost

XtraMile, Indian Oil’s new generation High Speed

Diesel with world-class additives has taken a leadership
position in the market. Available at nearly 4400 Retail
Outlets nationwide, XtraMile offersExtramileage-
GreaterAcceleration Faster pick-up -Lower maintenance
CostsLonger Engine life -Enhanced overall performance
Eliminates engine knockings

24
The premium auto fuels - XtraPremium and XtraMile (originally IOC Premium and Diesel
Super respectively), mark a new beginning for Indian Oil and offer a new genre of
convenience and enhanced comfort for our customers.

IndianOil's XtraPower Fleet Card Program is a

complete fleet management solution for Fleet
Owners / Operators and Corporates. XtraPower is a
Smart Card based Fleet Card Program, which
facilitates cashless purchase of fuel & lubes from
designated retail outlets of Indian Oil through flexible prepaid and credit facilities. The fleet
card program also offers an exciting Rewards Program and unique benefits like personal
accident insurance cover and vehicle tracking facilities.

In just under two years of its launch, IndianOil’s XtraPower Fleet Card has recently emerged
as the largest fleet card in the country, having crossed the one million mark.
XtraPower is not only the most comprehensive and largest fleet card in India but also the card
with the widest Retail Outlet coverage with more than 2635 retail outlets in its network.

The average sales usage on the card alone has touched over Rs. 12 crore a day and at this
level, it has locked in about 22% of the Fleet market share in the retail segment.
Any Fleet Owner/Operator, Corporate or business entity owning or operating commercial
vehicles, can become a member of XTRAPOWER fleet card program at a nominal annual
charge. Each Fleet owner is issued one Fleet Control Card and vehicle-specific Fleet Cards
for every vehicle enrolled under the program. For enhanced security, the fleet card
transactions are authorized through unique Personal Identification Number (PIN).

Some of the salient features of XtraPower are Flexible Pre-paid and Credit options, Card
Limits for better control, web-based allocation of funds on specific cards, Card-to-Card Fund
Transfer, Attractive Reward program, Free personal accident insurance cover for Fleet
Owner, Driver, Co-driver and Helper; option for Real time truck tracking at subsidized cost,
Interest-free credit with an option for customer to choose from more than one credit partners,
widespread coverage at over 2600 outlets all over country, discounts on purchases through
reward points, redemption of points not only for fuel & lubes but also for a wide range of
consumer goods an novelties.

25
 Swagat’ Highway Flagship Retail Outlets
To cater the high growth areas of National Highways
forming a part of Golden Quadrilateral and N-S, E-W
corridors, Indian Oil has launched Flagship Outlets,
which have been branded as “Swagat” Retail Outlets.

The facilities in the Swagat outlets is designed for, Best Q&Q standards in the industry
through Retail Outlet site and tank truck automation Third party certification through Bureau
Veritas Fortnight sampling thru Quality Audit Officers Training through a professional
agency for the Dealer
Incentives available on fuel purchases in the form of loyalty points redeemable against
fuel/lubes and other rewards.

Availability of XtraMile and XtraPremium

Forecourt standards: strict housekeeping and maintenance standards ensure consistence

performance in terms of service, on time, every time.

Non-fueling offering tailored to increasing driver comfort and productivity.

Non-fueling offering through ‘Best-in-class’ alliance on exclusive basis wherever possible
(communication, food/rest, healthcare, parking, vehicle care.)

There are 111 such ‘Swagat’ Flagship ROs planned across the country of which 45 ‘Swagat’
Flagships have already been commissioned with a complement of fuel and non-fuel.

The launch of XtraCare was the culmination of a series of

plans in retail design, product and service upgradation,

26
capability training, automation, loyalty programme, retail site management techniques all
benchmarked to global standards.

While the industry standard is to take samples on a quarterly basis, Indian Oil has moved
several steps ahead by introducing fortnightly random sampling with specific importance
given to RON (Research Octane Number) sampling which is truly the definitive test for
quality and quantity.

The surveillance audits by BV are being done on a more comprehensive basis. In another
pioneering move, the third party certification, by BV, is also being done, for the first time, on
a range of parameters that include hygiene, service, efficiency of fore court, allied services
and customer satisfaction.

The non-fuel services are being given a major fillip in the Indian Oil XtraCare plan with a
wide range of loyalty programme with -XtraRewards, XtraPower and co-branded cards like
Citibank-Citibank credit cards. The automation project of XtraCare is by far the most state-
of-the-art in the country. The cutting edge technology includes automatic tank level gauges,
temperature sensors, density measurement sensors, back-office server with DU controls,
automatic bill printing facility, customer database, etc.

The Tank Truck automation - Sealed Parcel Delivery System (SPDS) - will also include
electronic locking of TTs carrying loads to these ROs. The real time density sensors and the
sealed parcel delivery system is superior to mere GPS-based tracking systems because it not
only tracks where the Tank Truck is but what is happening to the Tank Truck consignments.
SPDS ensures that the quality of the fuel would be ensured from “Supply point to the
Customers”.

As a precursor to the Indian Oil XtraCare launch, Indian Oil had recently introduced the
Platinum Circle and Gold Circle - top of the line, exclusive clubs for high selling retail outlet
dealers. These elite Indian Oil dealers have emerged as peer leaders and are an integral part
of the XtraCare dealer ‘sensitisation’ strategy.

27
28
INRODUCTION TO PANIPAT REFINARY

What is a refinery?

Inside a maze of silver of towers and pipes is a fascinating factory that changes hydrocarbon
molecules to make motor sprit (petrol) and other useful products.
Thus a refinery is a factory that takes raw material-crude oil- and transforms it into various
other products. Refining breaks crude oil down into its various components, which then are
selectively reconfigured into new products. However, all refineries perform three basic: steps:
separation, conversion and treatment.
Separation- Heavy on the bottom, light on by distillation.
Conversion- cracking and rearranging molecules to add values.
Treatment- Reforming

LOCATION
Indian Oil Corporation Limited.
Panipat Refinery.
P.O- Panipat Refinary.
District: Panipat
Pin Code: 132140
Haryana.
Phone No: (0180)-2587825 Extension.
Fax: 0180-2587833/44.

                      

29
Refinery Performance
 
Panipat Refinery was commissioned on 2nd Oct 1998. The refinery has been increasing its
capacity utilization since inception.

Refinery has developed new products like 96 RON gasoline for the Indian army, different
grades of petrol, diesel & HPS for specific consumers.

Upward integration and Diversification

Exploration and Production (E& P)

The company has embarked upon major investments in E& P so as to secure it’s own equity
oil and safeguard it’s business interests against volatile international oil market. It has entered
in to various joint ventures and “farm out agreement” with ONGC and other private and
foreign companies in India and abroad.

Gas
Gas has emerged as the preferred fuel of the utilities viz; power, fertilizers and transportation.
It’s share in the total energy basket is expected to rise from 18.8% at present to 20% by 2025.
the company has adopted multi pronged strategy to take advantage of the strategic shift
occurring in the energy sector.

Petronet LNG Ltd. (PLL)

PLL, a joint venture promoted by IOC along with BPCL, ONGC and GAIL has
commissioned it’s 5mmtpa LNG terminal at Dahej in Gujarat, with first parcel of LNG from
Qatar. The IOC has decided to take-off 1.5mmtpa of LNG for the next 25 years as it’s maiden
foray into gas marketing.

30
Petrochemical
The company considers petrochemical as major growth driver in the future growth. The
company has just commissioned it’s linear alkyl benzene unit at it’s Koyali refinery with an
investment of Rs.12.5 Billion. The unit would use kerosene as feed stock (100tmtpa).

Capex Plans
The company has invisaged an investment of about Rs. 250 Billion spread over 8 years of
which Rs.108 billion would be invested in petrochemical business.

Some of the projects being undertaken by the company are as follows:

 Panipat refinery Expansion from 6mmtpa to 12 mmtpa.

 73 Km Mundra- Kandla crude pipeline and conversion of the Kandla Panipat
section of KBPL to crude oil service.
 353 Km Paradip- Haldia crude oil pipeline.
 506 Km Sidhpur- Sangner product pipeline.
 683 Km Chennai- Trichi- Madurai product pipeline.

Expertise in Pipeline Industry

Indian Oil Corporation operates the largest network of crude oil and petroleum pipelines in
India. Completed the construction of the 435 Km long Guwahati-Siligiri pipeline, the
pipelines of Indian Oil today transport petroleum products to the various major demand
centers of this geographically vast country and feed crude oil to four major inland refineries.

Indian Oil is one of the leaders in providing engineering, construction and consultancy
services to the pipeline industry. Highly qualified professionals with vast experience execute
pipeline projects from concept to commissioning and provide services for construction
supervision and project management.

PRISM- PANIPAT REFINERY INTEGRATED SYSTEM OF

MANAGEMENT
Integrated Policy on Quality, safety, Health & Environment (QSHE) 

31
We are committed to :
CUSTOMER’S DELIGHT by meeting and exceeding their requirements & expectations.

HEALTH AND SAFETY of people, while safeguarding material and equipment from
damage
ENVIRONMENTAL PROTECTION by minimizing pollution and optimizing the use of
natural resources.

COMPLIANCE of all safety & regulatory requirements.

CONTINUAL IMPROVEMENT to maximize wealth creation through teamwork,

innovation, technology, skill and competence.

SPREADING AWARENESS on QSHE among employees, contractors and interested

parties.
PANIPAT REFINERY – The Eco–Friendly Refinery

Salient Features of Environment Management

Only Desulphurised Fuel Gas and Low Sulphur Fuel Oil used in Refinery furnaces.
Sulphur Recovery Plant helps in reduction of Sulphur Dioxide emission. A standby sulphur
recovery unit of 115 Tonnes per day has been installed for continuous Sulphur recovery (in
the event when other unit is under maintenance).

1. State-of-the art effluent treatment plant. On line stack analysers provided to monitor
and control emissions.

2. Treated effluent meeting Minimal National Standards (MINAS) is totally reused

within refinery making Panipat Refinery a Zero Effluent Discharge Refinery.

3. 500 acres of land around Refinery has been developed as Green Belt and Ecological
Park. Around five lac trees already planted.

32
 4. Display board for SOx, Nox, SPM and temperature was installed on GT road along
with air monitoring station at Panipat.

5. Air Quality around the Refinery is monitored continuously through Air Monitoring
stations and Mobile Air Quality Monitoring Van.

DEPATMENTS IN PANIPAT REFINARY

Civil Maint. Power & utilities

Engineering services Process monitoring

Finance Process project

Training Human resource

Information systems Production

Inspection Project-PREP

Instrumentation Mechanical

Internal audit Medical

Material Safety &Environment

Quality ctrl Project-Petrochemical

Quality assurance

33
 FINANCE DEPARTMENT

Finance department is dealing with managing activity of funds of panipat refinery. It is

responsible for maintaining proper funds from outside and then uses it in the best way for
best result. It is also responsible for preparing the accounts according to legal policies and
procedure. In finance department there are seven departments:

 Project department
 Purchase department
 Main accounts
 Payroll department
 Misc. bills & accounts department
 Production department
 Welfare department

FINANCIAL OBJECTIVES:

 To ensure adequate return on the capital employed and maintain a reasonable annual
Dividend on its equity capital.
 To ensure maximum economy in expenditure
 To manage and operate the facilities in an efficient manner so as to generate adequate
internal resources to meet revenue cost and requirements for project investment,
without budgetary support.
 To develop long term corporate plans to provide for adequate growth of the activities
of the Corporation.
 To endeavour to reduce the cost of production of the petroleum products
manufactured by means of systematic cost control measures.
 To endeavour to complete all planned projects within the stipulated time and cost
estimates.

34
35
 RATIO ANALYSIS

Analyzing the financial performance of the business required study of financial performance
of the business.

A Financial Statement is a collection if data organized according to logical and consistent

accounting procedures. Its purpose is to convey an understanding of some financial aspect of
a business firm. It may show a position at a moment in time, as in the case of Balance –Sheet,
or may reveal a series of activities over a given period of time ,as in the case of income
statement.

Acc to Myers
“ 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 result of operation during a certain period”

METHODS OF FINANCIAL ANAYSIS

 Comparative Balance-Sheet
 trend analysis
 common-size statement
 fund flow statement
 cash flow analysis
 ratio analysis
 cost- volume analysis.

36
Financial Ratio Analysis

Financial Ratio Analysis derived from the information in a company's financial

statements. The level and historical trends of these ratios Financial ratio analysis is the
calculation and comparison of ratios which are can be used to make inferences about a
company's financial condition, its operations and attractiveness as an investment.

Financial ratios are calculated from one or more pieces of information from a company's
financial statements. For example, the "gross margin" is the gross profit from operations
divided by the total sales or revenues of a company, expressed in percentage terms. In
isolation, a financial ratio is a useless piece of information. In context, however, a financial
ratio can give a financial analyst an excellent picture of a company's situation and the trends
that are developing.

A ratio gains utility by comparison to other data and standards. Taking our example, a gross
profit margin for a company of 25% is meaningless by itself. If we know that this company's
competitors have profit margins of 10%, we know that it is more profitable than its industry
peers which is quite favourable. If we also know that the historical trend is upwards, for
example has been increasing steadily for the last few years, this would also be a favourable
sign that management is implementing effective business policies and strategies.

Financial ratio analysis groups the ratios into categories which tell us about different facets of
a company's finances and operations. An overview of some of the categories of ratios is given
below.

 Leverage Ratios which show the extent that debt is used in a company's capital
structure.
 Liquidity Ratios which give a picture of a company's short term financial situation or
solvency.
 Operational Ratios which use turnover measures to show how efficient a company is
in its operations and use of assets.

37
  Profitability Ratios which use margin analysis and show the return on sales and
capital employed.
 Solvency Ratios which give a picture of a company's ability to generate cashflow and
pay it financial obligations.

It is imperative to note the importance of the proper context for ratio analysis. Like computer
programming, financial ratio is governed by the GIGO law of "Garbage In...Garbage Out!"
A cross industry comparison of the leverage of stable utility companies and cyclical mining
companies would be worse than useless.

Examining a cyclical company's profitability ratios over less than a full commodity or
business cycle would fail to give an accurate long-term measure of profitability. Using
historical data independent of fundamental changes in a company's situation or prospects
would predict very little about future trends. For example, the historical ratios of a company
that has undergone a merger or had a substantive change in its technology or market position
would tell very little about the prospects for this company.

Credit analysts, those interpreting the financial ratios from the prospects of a lender, focus on
the "downside" risk since they gain none of the upside from an improvement in operations.
They pay great attention to liquidity and leverage ratios to ascertain a company's financial
risk. Equity analysts look more to the operational and profitability ratios, to determine the
future profits that will accrue to the shareholder.

Although financial ratio analysis is well-developed and the actual ratios are well-known,
practicing financial analysts often develop their own measures for particular industries and
even individual companies. Analysts will often differ drastically in their conclusions from the
same ratio analysis.

As in all things financial, beauty is often in the eye of the beholder. It pays to do your own
work!

38
RATIO
Ratio is simple arithmetical expression of the relationship of a number to another number.
it may be defined as the indicated quotient of two mathematical expression.

Acc to Accountant Handbook by Wixion, Kell and Bedford

“Ratio is an expression of the quantitive relationship between two numbers”

Acc to Kohler
“A ratio is the relation of the amount, a, to another, b, expressed as the ratio a to b; a:b(a
is to b); or as a simple fraction , integer, decimal, fraction, or percentage”

For Eg: if the current assets of a company on a particular date is rs 500000 and current
liabilities on this date is rs 250000
current ratio is 2:1
500000 = 2:1
250000

NATURE OF RATIO ANALYSIS

A) Ratio is the process of establishing and interpritig various for helping in

certain decisions.
B) It is not an end in itself.
C) It is only a means of better understanding of financial strength and
weakness of a firm.
D) Combination of ratios are used for studies.

39
OBJECTIVE OF RATIO ANALYSIS;

1. Measuring the profitability.

2. Determining operational effeciency.
3. Assessing solvency of the bussiness
4. Measuring financial position.
5. Facilitating comparative analysis.
6. Indicating overall effeciency.
7. Budgeting and forecasting
8. Simplfying accounting figures

SIGNIFICANCE OF RATIO ANALYSIS

Managerial Significance

1. Helps In Decision Making

Ratio Analysis helps in making decisions from the provided in the financial statement.

2. Helps In Financial Forecasting

Meaningful conclusion can be drawn for future from these ratios. thus, ratio analysis helps in
future forecasting and planning.

3.Helps in communication:
The financial strength and weakness of the firm can be easily understood with the use of
ratios.

4.Helpful In Coordination:
Better communication of effeciency and weakness of an enterprises result in better
coordination in the enterprises.

5. Helps in control:
Standard ratio can be used to find out variations and deviations. which helps in taking
correctve decisions.

40
6. Other uses:
 These are some other uses of ratio analysis
 It is essential part of the budegetary control &standard costing.
 Analysis and interpretation of financial statements.

UTILITY TO SHAREHOLDERS
The investors will feel satisfied only if the concern has sufficient amount of assists.
long term solvency ratio will them in assessing financial position of the concern.
profitability ratio, on the other hand, will be useful to determine profitability position.
ratio analysis will be useful to the investor in making up his mind whether present financial
position of the concern warrants further investment or not.

Utility To Creditors
creditors are interested in knowing short-term credit payment position of the concern .
current and acid test ratio will give an idea about the current financial position of the concern.

Utility To Employees
employees are interested in knowing the financial position of the concern espicislly
profitability.
their wages &benefits directly depends upon profit of the organisation.
profitability ratio used are
 gross profit
 operating profit
 net profit

Utility To Government
Government is interested to know the overall strength of the industry.
various financial ststement published by concerns are used to calculate ratios for determining
short-term, long-term and overall financial position of the industry.

41
Limitation Of Ratios Analysis

1) Limited use of single ratio

 Single ratio ,usually, not convey much of sense.
 To make a better interpretation a number of ratio have to be calculated which
is likely to confuse the analyst than help him in making any meaningful
conclusion.

2.Lack of adeqate standards:

 There no well accepted standard & norms. It renders interpretation of ratio
difficult.

3.Inherent limitation of accounting:

 Ratio suffer from the inherent weakness of accounting records such as their
historical nature.
 Ratio of the past are not the true indicator of the future.

4.Change of accounting procedure:

 Change in accounting procedure by a firm often makes ratio analysis misleading.

5. Price Level change:

 Absolute figure distortive. ratio devoid of absolute figure may prove distortive as
ratio analysis is primally a quantitative analysis not a qualitative analysis
 While making ratio analysis , no consideration is made to the change in price level.
& this make the interpretation of analysis invalid.

42
CLASSIFICATION OF RATIOS

LIQUIDITY RATIO
 Current ratio
 Acid ratio
 Absolute liquid ratio

LONG TERM SOLVENCY RATIO

 debt equity ratio
 debt to total capital ratio
 interest coverage ratio
 cash flow/ debt
 capital gearing ratio

ACTIVITY RATIO
 inventory turnover ratio
 debtors turnover ratio
 fixed assets turnover ratio
 total assets turnover ratio
 working capital turnover ratio
 payables turnover ratio
 capital employed turnover ratio

PROFITABILITY RATIO
IN RELATION TO SALES
 Gross profit ratio
 Operating profit ratio
 Net profit ratio
 Expense ratio

43
B) IN RELATION TO INVESTMENT
 Return on investment
 Return on capital
 Return on Equity capital
 Return on total resources
 Earning per share
 Price earning ratio

LIQUIDIYT RATIO
 Liquidity refers to the ability to pay its current obligation as and when these become
due
 The short term obligation are met by releasing amounts from current, floating or
circulating assests. These should be convertible into cash for paying obligations of
short –term nature .

Current ratio
Current ratio may be defined as the relationship between current assests and current
liabilities. This ratio also known as working capital ratio, is a measure of general liquidity
and is most widely used to make thean alysis of short –term financial position or liquidity
firm.
CURRENT RATIO = CURRENT ASSESTS/ CURRENT LIABILITIES

Components of current ratio

Current assests Current Liabilities
Cash in hand Bills Payable
Marketable securities outstanding expense
Short term Investments Sundry Creditors
Bills receivable Short Term Advances
Sundry debtors Income Tax Payable
Investments Dividends Payable
Work in process Bank Overdraft
Prepaid expenses
Ideal ratio = 1:2

44
QUICK RATIO/ ACID TEST RATIO

The term liquidity refers to the ability of the firm to pay its short term obligations as and
when they become due
Quick ratio may be defined as the relationship quick acids and current liabilities

QUICK RATIO = QUICK ASSESTS / CURRENT LIABILITIES

Components of quick / liquid ratio

Quick / Liquid Assets current liabilities

Cash in hand Bills Payable
Marketable securities Outstanding expense
Short term Investments Sundry Creditors
Bills receivable Short Term Advances
Sundry debtors Income Tax Payable
Investments Dividends Payable
Bank Overdraft

Ideal ratio = 1:1

Significance of Quick ratio

 It is very useful in measuring the liquidity position of a firm
 It measures the firm capacity to pays it current obligation immediately and is amore
rigourous test of liquidity then the current ratio
 It is use as acomplementary ratio to the current ratio

ABSOLUTE LIQUID RATIO / CASH RATIO

45
Absolute liquid assets includes cash in hand and cash at bankvand marketable securities or
temporary investmernt
The acceptable norm for this ratio is 50% or 0.5 : 1 or 1:2
CASH RATIO = CASH AT BANK/CURRENT LIABILITIES

ACTIVITY RATIO

Activity ratios measure the efficiency or effectiveness with which a firm manages it resources
or assets. Theses ratios are also called Turnover Ratio because they indicate the speed with
which assets are converted into sales.
For example: inventory turnover ratio indicates the rate at which the funds invested in
inventories are converted into sales.
Depending upon the purpose, a number of turnover ratios are calculated

INVENTORY TURNOVER RATIO/STOCK TURN OVER RATIO

Inventory turnover ratio indicates whether inventory has been efficiently used or not.
Turnover ratio indicates the number of times the stock has beenturned over during the period
and evaluates the efficiency with which a firm is able to manage its inventory.

COST OF GOODS SOLD

INVENTORY TURNOVER RATIO =

AVERAGE INVENTORY

AVERAGE INVENTORY =OPENING STOCK + CLOSING STOCK /2

Interpretation of Inventory Turnover Ratio

 A high inventory Turnover Ratio, indicates efficient management of resources.
 A high Inventory Turnover Ratio does not necessarily imply higher profits.

DEBTOR TURNOVER RATIO

46
Debtor turnover ratio Indicats the velocity of debt collection of firm.In Simple words , it
indicates the number of times average debtors are turnover during a year.

DEBTOR TURNOVER RATIO = NET CREDIT SALES

AVERAGE TRADE DEBTORS

Average trade debtors = opening trade debtors + closing trade debtors

2
Interpretation of debtor turnover ratio
 Higher the value of debtor turnover the more efficient is the management of sales or
more liquid are the debtors.

CREDITORS TURNOVER RATIO

The analysis for creditors turnover is basically the same as of debtors turnover ratio

CREDITORS TURNOVER RATIO = NET CREDIT ANNUAL PURCHASES

----------
AVERAGE TRADE CREDITORS

The ratio indicate the velocity with which the creditors are turnover in relation to purchase.
Generally, higher the creditor velocity better isor otherwise lower the creditor velocity , less
favourable are the results.

WORKING CAPITAL TURNOVER RATIO

47
Working capital of a concern is directly to sales .

Working capital = current assets – current liabilities

It indicates the velocity of the utilization of net working capital . This ratio indicates the
number of times the working capital is turnover in the course of a year . This ratio measures
the efficiency with which the working capital is being is used by a firm
WORKING CAPIAL TURNOVER RATIO = COST OF SALES
AVERAGE WORKING CAPITAL

Average working capital = opening working capital + closing working capital

2

SOLVENCY RATIO

DEBT EQUITY RATIO

DEBT EQUITY RATIO also known as External – Internal Equity Ratio is calculated to
measure the relative claims or outsiders and the owners against the firm assets.

DEBT EQUITY RATIO = EXTERNAL EQUIIES

INTERNAL EQUITIES

INTERPRETATION OF DEBT EQUITY RATIO

A ratio of 1:1 is considered to be a satisfactory ratio although they cannot be any rule of
thumb or standard norm of all types of business . in some business a higher ratio 2:1 or even
more may even be considered satisfactory .

FUNDED DEBT TO TOTAL CAPITALISATION

48
THE RATIO establishes a linked between the long term funds raised from outsiders and long
term funds available in the business .

FUNDED DEBT TO TOTAL CAPITALISATION = FUNDED DEBT X 100

TOTAL CAPITALISATION
if this Ratio is smaller , better it will be , upto 50% to 55% this ratio may be tolerable and not
beyond

FIXED ASSETS TO NET WORTH RATIO

THIS ratio establishes the relationship between fixed assets and shareholdersfunds, thatn is
share capital + reserves & surplus and retained earnings

FIXED ASSETS TO NET WORTH RATIO = FIXED ASSETS

NET CAPITAL
the Ratio of fixed assets to net worth indicates the extent to which the shareholder fund are
some into fixed assets .

FIXED ASSETS TO LONG TERM FUNDS

A variant to the ratio of the fixed assets to net worth is the ratio of fixed assets to long term
funds which is calculated as

FIXED ASSETS RATIO = NET FIXED ASSETS

TOTAL LONG TERM FUNDS

GENERALLY THE THE TOTAL of the fixea assets should be equal to the total of the long
term funds or , say the ratio should be 100%

INTEREST COVERAGE RATIO

NET INCOME to debt service ratio or simply debt service ratio is used to test the debt
servicing capacity of a firm. The ratio is also known as interest coverage ratio or fixerd
charges cover ratio.

49
INTEREST COVERAGE RATIO = NET PROFIT BEFORE INTEREST & TAX

FIXED INTEREST CHARGES

Interpretation ratio
 Higher the ratio , more safe are the liong term creditor because even if earnings of the
firm fall, the firm shall be abler to meet its commitment of fixed interest charges .

PROFITABILITY RATIO

Profits to the management are the test of the efficiency and a measurement of a control;to
owners, a measure of worth of their investment ; to the creditors the margin of safety ; to
employees , a source of fringe benefits; to government a measure of tax paying capacity and
the basis of the legistative action .

A ) General Profitability Ratio

GROSS PROFIT RATIO
IT MEASURE s the relationship of gross profit to net sales .
Usely represented as a percentage
GROSS PROFIT RATIO = gross profit x 100

Sales

Interpretation
 It reflects the efficiency with which a firm produces its product.
 Higher the gross profit ratio better the result

OPERATING PROFIT RATIO

50
THIS RATIO is calculated by dividing operating profit by sales
OPERATING PROFIT RATIO = OPERATING PROFIT X100
--------------------------------
SALES

Operating profit = net profit + non operating expenses

EXPENSE RATIO

Expense ratio indicates the relationship of various expense stop net sales .
The operating ratio reveals the average total variation in expenses.
But some of the expenses may be increasing while some may be falling .

PARTICULAR EXPENSE RATIO = PARTICULAR EXPENSE X 100

NET SALES

NET PROFIT RATIO

It establishes the relationship between net profit after interest and tax an d sales ,sand
indicsates the efficiency of the management in manufacturing, selling , administrsative and
other activities of the firm

This ratio is the overall the measure of firm profitability

NET PROFIT RATIO = NET PROFIT AFTER TAX X 100

NET SALES

Interpretation
 Higher the ratio , the better is the profitability

51
B) OVERALL PROFITABILITY RATIO
Profits are the measure of overall the efficiency

RETURN ON INVESTMENT
Return On Investment Popularly known as ROI or return on shareholders funds. It is a
relationship between net profit after interest & tax and the proprietors fund

RETURN ON INVESTMENT = NET PROFIT (AFTER INTEREST & TAX) X100

SHAREHOLDERS FUNDS

Interpretation
 Ratio reveals how well the resources of the firm are being used , higher the ratio
better the result

RETURN ON EQUITY CAPITAL

RETURN ON EQUITY CAPITAL , is the relationship between profits of a ccompany and

equity capital

RETURN ON EQUITY CAPITAL =Net Profit After Tax – Preference Dividend

EQUITY SHARE CAPITAL

INTERPRETATION
 Higher the rastio , the better is .

EARNING PER SHARE

EPS is the small;l variation of return on equity capital and is calculated by dividing net profit
after taxes and preference dividend by the total number equity shares

EARNING PER SHARE = Net Profit After Tax – Preference Dividend

52
 No. of equity shares

RETURN ON CAPITAL EMPLOYED

it establishes the relationship between profits and capital employed. It is primary ratio and it
is widely ratio to measure the overall profitability ratio and efficiency of business.

RETURN ON GROSS CAPITAL EMPLOYED = ADJUSTED NET PROFIT X 100

GROSS CAPITAL EMPLOYED

RETURN ON NET CAPITAL EMPLOYED = AJUSTED NET PROFITS X100

NET CAPITAL EMPLOYED

CAPITAL TURNOVER RATIO

Capital Turnover ratio is the relationship between Cost of goods sold or sales and the capital
employed

This ratio is calculated to measure the efficiency of with which of firm utilizes it resources or
the capital employed
CAPITAL TURNOVER RATIO = COST OF GOODS SOLD OR SALES
CAPITAL EMPLOYED

C ) MARKET TEST OR VALUATION RATIO

DIVIDEND YIELD RATIO IS THE calculated to evaluate the relationship between

dividend per share and the market value of the shares.

DIVIDEND YIELD RATIO = DIVIDEND PER EQUITY SHARE

53
 MARKET VALUE PER SHARE

DIVIDEND PER SHARE = DIVIDEND PAID TO SHAREHOLDERS

NO. OF SHARES

DIVIDEND PAYOUT RATIO

It is calculated to find out the extent to which earning per share have been retained in the
business . it is an important ratio because ploughing back of profits enables a company to
grow and pay more dividends in future .

DIVIDEND PAYOUT RATIO = DIVIDEND PER EQUITY SHARE

EARNING PER SHARE
PRICE EARNING RATIO
it is the rsatio between market price per equity share and earning per share. This ratio is
calculated to make an estimate of apprecuiation in the value of share of accompany and is
widely used by investors to decide whether or not to by shares in a particular company

PRICE EARNING RATIO = MARKET PRICE PER EQUITY SHARE

EARNING PER SHARE

Interpretation
 Generally higher the price earning ratio , the better is .
 If the P/E RATIO falls , the management should look into the causes that ha\ve
resulted into the fall of this ratio

MARKET VALUE TO BOOK VALUE RATIO

It is the relationship between market value per share of the firm and its book value per share

54
MARKET VALUE TO BOOK VALUE RATIO = MARKET VALUE PER SHARE

BOOK VALUE PER SHARE.

Book Value Per Share = equity share capital + R&S - Accumulated losses
Tital no. of shares
Book value per share indicates thje net worth perequity share &the ratio of market value to
book value may be used to analyse its stock market position.

LEVERAGE RATIO
CAPITAL GEARING RATIO:
CAPITAL GEARING is used to describethe relationship between equity share
capitalincluding reserve & surpluses nto preference share capital and other fixed interest
bearing loans if the preference shares capital and other fixed assets , fixed interest bearing
loans exceeds the equity share capital including reserves, the firm is said to be highly geared.
CAPITAL GEARING RATIO = equity +reserves

Preference share capital + long term debt bearing fixed interest

FINANCIAL LEVERAGE
It is the owner equity which is used as a basis to raise loans and that is why is cal;led trade
on equity capital

FINANCIAL LEVERAGE = EARNING BEFORE INTEREST & TAX

EARNING BEFORE INTEREST & TAX AND

PREFERENCE DIVIDEND

TOTAL INVESTMENTS TO LONG TERM INVESTMENTS

55
This ratio is calculated by dividing the total long term funds by long term liabilities

TOTAL INVESTMENTS TO LONG TERM INVESTMENTS

= shareholders funds + long term liabilities / long term liabilities

Interpretation
 Has a general rule proportion of long term liabilities should not be very high

RATIO OF FIXED ASSETS TO FUNDED DEBT

THE RATIO measures the relationship between the fixed assets and the funded debt adnd is
very useful to the long term creditors

RATIO OF FIXED ASSETS TO FUNDED DEB = FIXED ASSETS

FUNDED DEBT

RATIO OF CURRENT LIABILITIES TO PROPRIETOIRS FUNDS

THE ratio of current liabilities to proprietoirs funds establishes the relationship between
current liabilities and the proprietors funds and indicates amount oif long term funds raised
by the proprietor as against short term liability

RATIO OF CURRENT LIABILITIES TO PROPRIETOIRS FUNDS

= CURRENT LIABILITIES

PROPRIETOIRS FUNDS

RATIO OF RESERVES TO EQUITY CAPITAL

This ratio indicates that how much profit are generally retained by the firm for the furure
growth

RATIO OF RESERVES TO EQUITY CAPITAL = RESERVES X 100

Equity share capital

56
 RESEARCH METHODOLOGY

Research methodology is a way to systematically solve the research problem. In it step-by-

step methods are followed to solve a particular problems. It refers to a search for knowledge.
It can also be defined as a scientific and systematic search for pertinent information on a
specific topic. In fact, research is an art of scientific investment.

RESEARCH DESIGN
Research design is the way in which the research is carried out. It works as a blue print.
Research design is the arrangement of condition for the collection and analysis of data in a
manner that aims to combine relevance to the research purpose with economy in procedure.

Sample design
It is not possible for any researcher to include each and every member of the universe in his
research process. So, he selects small portion of the universe, which is its true representative.
This group known is sample and this process is called Sampling.

Sampling techniques can be categorized into two broad categories namely :

 Non – Probability Sampling

 Probability Sampling

Non – Probability Sampling

In it, sample is selected deliberately by researcher , by using his own judgement. In it every
item of universe does not have equal chances of inclusion in the sample.
It can be of following type :
 Convenience Sampling
 Judgement Sampling
 Quota Sampling

57
Probability Sampling
It is also known as ‘Random Sampling’ or ‘Chance Sampling’. In it, each population element
has equal chance of selection

It can be of following type:

 Simple Random Sampling
 Stratified Sampling
 Cluster Sampling

In the present project, non - probability sampling has been used because sample is selected by
researcher ‘s own view and every item of universe has not equal chances of being selected. .
Under non- probability sampling, convenient sampling has been used because sample has
been selected according to own convenience.

DATA COLLECTION
The data can be of two type :

 Primary Data
 Secondary Data

Primary Data

Primary data are those data, which is originally collected afresh.

Secondary data

Secondary data are those data which are collected and score and which has been passed
through statistical research.
In this project, secondary data has been collected from following sources
 Annual Reports
 Books
 M.L.S
 Other material and report published by company

58
59
Liquidity ratio

1. CURRENT RATIO

Year   2014 2015 2016 2017 2018 2019 2020

Current Assets BS 1244.82 941.46 1409.56 1974.03 1895.99 2779.93 1932.59
Current
liabilities B/S 26.03 71.36 21.27 27.83 74.99 815.53 1007.70
CR = CA/CL
CURRENT
RATIO   47.81 13.19 66.27 70.93 25.28 3.41 1.92

INTERPRETATION
 This ratio has been falling from 47.81 in 2013-2014 to 13.19 in 2014-15. then start
growing but again start falling in 2017-2018 and continue till 2019-2020.
 This shows the lack of short term financial soundness of business i.e its incapability to
meet its current obligations has increased.

60
2. QUICK ACID TEST RATIO OR LIQUID RATIO

Year   2014 2015 2016 2017 2018 2019 2020

liquid asset B/S 131.44 13.68 133.55 233.23 248.62 290.26 309.13
Current liabilities B/S 237.30 140.27 133.55 171.42 416.90 336.99 376.03
LR = LA/CL
LIQUID RATIO   0.55 0.10 1.00 1.36 0.60 0.86 0.82

INTERPRETATION
 This ratio has been falling from 0.55 in 2013-2014 to 0.10 in 2014-2015. then start
growing but again start falling in 2017-2018 and continue till 2019-2020.
 This shows the lack of short term financial soundness of business i.e. its incapability
to meet its current obligations has increased.

61
EFFECIENCY RATIO

1. INVENTORY TURNOVER RATIO

Year   2014 2015 2016 2017 2018 2019 2020
Sales T 3323.54 6688.06 5721.67 7740.58 8103.77 8466.96 9130.15
Opening Stock T 109.81 351.15 284.06 227.33 302.85 378.37 453.90
Closing Stock T 351.10 284.36 227.33 306.27 538.01 76.98 1001.50
Avg. Stock 230.46 317.76 255.69 266.80 420.43 574.06 727.70
STR=COGS/AS
Stock Turnover Ratio   14.42 21.05 22.38 29.01 19.27 14.75 12.55

INVENTORY TURNOVER RATIO

35.00
30.00
25.00
20.00
ITR

15.00
10.00
5.00
0.00
2000 2001 2002 2003 2004 2005 2006
YEAR

INTERPRETATION
 This ratio has been increasing from 14.22 in 2013-2014 to 29.01 in 2016-2017.Then
start falling in 2017-2018 and continue till 2019-2020.
 This shows the lack of short term financial soundness of business i.e. its incapability
to meet its current obligations has increased

62
2. WORKING CAPITAL RATIO

Year   2014 2015 2016 2017 2018 2019 2020

Current Assets BS 1244.82 941.46 1409.56 1974.03 1895.99 2779.93 1932.59
Current Liabilities BS 237.30 140.27 133.55 171.42 416.90 336.99 376.03
WCR=CA/CL&P
Working Capital Ratio   5.25 6.71 10.92 11.85 4.62 4.247 2.15

WORKING CAPITAL RATIO

14.00
12.00
10.00
8.00
WCR

6.00
4.00
2.00
0.00
2000 2001 2002 2003 2004 2005 2006
YEAR

INTERPRETATION
 This ratio has been increasing from 5.25 in 2013-2014 to 11.85 in 2016-2017.Then
start falling in 2017-2018 and continue till 2019-2020.
 This shows the lack of short term financial soundness of business i.e. its incapability
to meet its current obligations has increased

63
3.FIXED ASSETS TURNOVER RATIO

Year   2014 2015 2016 2017 2018 2019 2020

Sales T 3323.54 6688.06 5721.67 7740.58 8103.77 8466.96 9130.15
Fixed Assets BS 2397.46 2411.24 2328.43 2934.74 4180.38 7105.48 8940.85
FATR=SALES/FA
Fixed Assets turnover
ratio 1.39 2.77 2.46 2.64 1.94 1.19 1.02

FIXED ASSETS TURNOVER RATIO

3.00

2.50

2.00
FATR

1.50

1.00

0.50

0.00
2000 2001 2002 2003 2004 2005 2006
YEAR

INTERPRETATION
 There is tremendous increase in the ratio from 1.39 in 2013-2014 to 2.77 in 2014-
2015. this ratio falls & again rise in 2016-2017 at 2.64.
 Then this ratio falls & reach to 1.02 in 2019-2020.

64
LONG TERM FINANCIAL POSITION

1. DEBT TO EQUITY RATIO

Year   2014 2015 2016 2017 2018 2019 2020

Secured Loans C 16.11 7.14 2.13 2.78 74.99 16.21 79.91
Unsecured Loans D 9.92 0.00 0.00 0.00 0.00 0.00 0.00
Debt 26.03 7.14 2.13 2.78 74.99 16.21 79.91
Reserve and surplus B 281.77 320.44 141.74 1112.70 1144.34 1644.37 1269.54
DER=((SL+UL)/RS)*100
Debt Equilty Ratio   9.24 2.23 1.50 0.25 6.55 0.99 6.29

DEBT EQUITY RATIO

10.00
9.00
8.00
7.00
6.00
DER

5.00
4.00
3.00
2.00
1.00
0.00
2000 2001 2002 2003 2004 2005 2006
YEAR

INTERPRETATION
 This ratio is very high in starting years and it is 9.24 in 2013-2014. But after then this
ratio falls in successive years.
 This shows that the company is less dependent on loans from financial institution. It is
generating quite a good amount of profits & belive in ploughing back profit for future
expansion.

65
2. FUNDED DEBT TO TOTAL CAPITALISATION

Year   2014 2015 2016 2017 2018 2019 2020

Secured Loans C 16.11 7.14 2.13 2.78 74.99 16.21 79.91
Unsecured Loans D 9.92 0.00 0.00 0.00 0.00 0.00 0.00
Debt 26.03 7.14 2.13 2.78 74.99 16.21 79.91
Reserve and surplus B 281.77 320.44 141.74 1112.70 1144.34 1644.37 1269.54
DTTF=Debt/(Debt+R&S)
Debt to Total Fund   0.085 0.022 0.015 0.002 0.062 0.010 0.059

FUNDED DEBT

0.090
0.080
0.070
0.060
0.050
FDR

0.040
0.030
0.020
0.010
0.000
2000 2001 2002 2003 2004 2005 2006
YEAR

INTERPRETATION
 This ratio is falling from 0.085 in 2013-2014 and reach to 0.002 in 2016-2017.
 Then this ratio again falls and again rises.
 This ratio indicates that the company has capabilities to lower down the dependence
on secured & unsecured loans.

66
3.FIXED ASSETS RATIO

Year   2014 2015 2016 2017 2018 2019 2020

Fixed Assets BS 2397.46 2411.24 2328.43 2934.74 4180.38 7105.48 8940.85
Secured Loans C 16.11 7.14 2.13 2.78 74.99 16.21 79.91
Unsecured Loans D 9.92 0.00 0.00 0.00 0.00 0.00 0.00
Reserve and surplus B 26.03 7.14 2.13 2.78 74.99 16.21 79.91
HO A/C/BRANCHES A/C 3098.08 2885.8 3461.23 3622.30 4440.53 7408.95 8515.22
FAR=FA/(SL+UNSL+R&S+HO A/C)
Fixed Assets Ratio   69.27 74.65 61.27 74.07 86.15 91.54 100.10

FIXED ASSETS RATIO

120.00

100.00
80.00
FAR

60.00

40.00
20.00
0.00
2000 2001 2002 2003 2004 2005 2006
YEAR

INTERPRETATION
 This indicates that in 2013-2014 the having 69.27% . this means that the company is
not utilising it long term funds efficiently.
 But in 2019-2020 this ratio reach to 100.10. This means that the company is utilising
it resources, but few part of fixed assets is financed by working capital

67
4. INTEREST COVERAGE RATIO

Year   2014 2015 2016 2017 2018 2019 2020

Profit Bef Int & Itax P/L 281.77 320.44 141.74 1112.70 1210.20 1307.69 1405.19
Int. on Long Term Loans P/L 0.07 4.54 21.68 0.00 1.20 1.23 1.36
ICR=PBIT/ILTL
Interest Coverage Ratio   3841.08 705.67 6.54 0! 1004.83 1067.08 1035.59
                 

INTEREST COVERAGE RATIO

4500.00
4000.00
3500.00
3000.00
2500.00
ICR

2000.00
1500.00
1000.00
500.00
0.00
2000 2001 2002 2003 2004 2005 2006
YEAR

INTERPRETATION
 Company interest coverage ratio is very high. But this ratio in 2013-2014 is very high
i.e. 3841.08.
 Then it falls and reach to zero in 2016-2017
 Then there is dramatic growth in 2017-2018 &reach to 1004.83 and growth is
continue in successive year in 2018-2019 it is 1067.08 but fall in 2019-2020 & ratio is
1035.59

68
PROFITABILITY RATIOS

1. NET PROFIT RATIO

Year   2014 2015 2016 2017 2018 2019 2020

Net Profit P/L 281.77 320.44 141.74 1112.70 1210.20 1307.69 1405.19
Sales T 3323.54 6688.06 5721.67 7740.58 8103.77 8466.96 9130.15
NPR=NP/S*100
Net Profit Ratio   8.48 4.79 2.48 14.37 14.93 15.44 15.39

NET PROFIT RATIO

18.00
16.00
14.00
12.00
10.00
NPR

8.00
6.00
4.00
2.00
0.00
2000 2001 2002 2003 2004 2005 2006
YEAR

INTERPRETATION
 In 2013-2014 company ratio is 8.48%, but in next to successive years it fall.
 From 2016-2017 it start increasing. It increase from 2.48% in 2015-2016 to 14.37 in
2016-2017, 14.37%. and this growth is continuous in successive years.

69
2. RETURN ON INVESTMENT

Year   2014 2015 2016 2017 2018 2019 2020

Profit Bef Int & Itax P/L 281.77 32.04 141.74 1112.70 1210.20 1307.69 1405.19
Fixed Assets BS 2397.46 2411.24 2328.43 2934.74 4180.38 7105.48 8940.85
Current Assets BS 1244.82 941.46 1409.56 1974.03 1895.99 2779.93 1932.59
Current Liabilities BS 231.49 1361.69 129.10 1665.16 410.58 654.64 898.70
Capital Employed   3410.80 3216.53 3608.90 4742.26 5665.79 9230.76 9974.73
RI=(PBIT/CE)*100
Return In Investment   8.26 9.96 3.93 23.46 21.36 14.17 14.09

RETURN ON INVESTMENT

25.00

20.00

15.00
ROI

10.00

5.00

0.00
2000 2001 2002 2003 2004 2005 2006
YEAR

INTERPRETATION
Capital of the company is not optimally utilised.

70
FIXED ASSETS TO CURRENT ASSETS TURNOVER RATIO

Year   2014 2015 2016 2017 2018 2019 2020

Fixed Assets BS 2397.46 2411.24 2328.43 2934.74 4180.38 7105.48 8940.85
Current Assets BS 1244.82 941.46 1409.56 1974.03 1895.99 2779.93 1932.59
FATCAR=FA/CA
Fixed Asset to Curr Assets
Ratio 1.93 2.56 1.65 1.49 2.20 2.56 4.63

FIXED ASSETS TO CURRENT ASSET RATIO

5.00
4.50
4.00
3.50
FATCAR

3.00
2.50
2.00
1.50
1.00
0.50
0.00
2000 2001 2002 2003 2004 2005 2006
YEAR
IN
INTERPRETATION
 In this ratio is very high in 2019-2020 i.e. 4.63
 Graph is showing upward trend and the ratio is continuously increasing in each
successive years.

71
72
LIMITATIONS

Although every efforts has been made to collect the relevant information through the sources
available, still some relevant information could not be gathered.

 The time duration could not provide ample opportunity to study every detail of
management in the company.
 There are restrictions not to visit some specific areas
 The concerned executives were having very busy schedule.
 Respondent were unaware of many terms related to Ratio Analysis while asking to
them.
 As some figures have not been disclosed by the company on account of confidential
report. The executives were hesitate to reveal complete information.

73
74
 PROFIT AND LOSS ACCOUNT
(fig in crores)
Particulars 2014 2015 2016 2017 2018 2019 2020
Income
Transfer of income 3323.53 6688.06 5721.67 7740.58 8103.77 7642.56 8841.63
Company use of own oil 0.00 0.74 0.00 0.00 0.00 0.25 0.246667
Net surrender value -44.89 20.71 40.58 50.32 34.21 90.94 133.6717
Increase/Decrease in stocks 300.37 -79.04 -8.20 155.51 212.46 -237.53 -391.81
Interest & other Incomes 14.17 3.12 2.29 2.22 2.47 -5.35 -11.29
Interest from Marketing
division 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Interest from AOD 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Ser charges from marketing
division 11.59 13.94 15.46 21.32 22.34 17.53 19.47
Ser. Charges from Pipelines 0.79 0.58 0.68 0.48 0.50 0.57 0.52
Trf. Of electricity to pl. 1.19 2.23 3.01 2.81 3.40 3.96 4.87
Trf. Of ho exp. To Pl. 0.00 0.00 0.00 0.00 0.00 0.00 0.00

TOTAL INCOME 3606.75 6650.34 5775.49 7973.24 8379.15 7512.93 8597.30

EXPENDITURE
Manufacturing,Admn, Selling
expenses 3115.77 6168.98 5384.16 6693.03 6942.11 7158.03 8292.22
Trf of finished product from
mkt.div. 0 0.00 0.00 0.00 0.00 0 0.00
Inter unit trf. Of product 0.00 0.00 0.00 0.00 0.10 0.00 0.00
Excise duty 70.23 8.73 -0.01 8.47 60.10 -43.93 -79.05
dep. & Amortation 130.08 137.81 142.22 144.74 142.54 148.84 154.91
Interest on loans 0.73 0.45 21.68 0.00 1.20 28.57 39.05
Commitment charges 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Exp. Paid to other div. 0.00 0.00 0.00 0.00 0.00 0.00 0.00
HO exp. Allocation a/c 9.22 13.93 11.89 12.98 22.90 14.35 15.69
TOTAL EXPENDITURE 3326.03 6329.90 5559.94 6859.22 7168.95 7305.86 8422.82

Profit for the year before tax 280.72 320.44 215.55 1114.02 1210.20 207.07 174.49
Incomes relating to previous
year -1.59 0.00 0.00 -1.33 0.00 0.00 0.00

Profit before tax 282.31 320.44 215.55 1115.35 1210.20 207.07 174.49

balance brought forward from

last year -30.53 0.00 0.00 0.00 0.00 0.00 0.00

75
Less transferred to regd. Office -30.53 0.00 0.00 0.00 0.00 0.00 0.00

Balance carried to balance-

sheet. 282.31 320.44 215.55 1115.35 1210.20 207.07 174.49

BALANCE-SHEET
Particulars 2014 2015 2016 2017 2018 2019 2020
sources of funds
share capital 0 0 0 0 0 0 0
reserves and surplus 282.24 320.44 141.74 1112.70 1144.34 1644.37 2361.95

TOTAL SHAREHOLDERS FUND 282.24 320.44 141.74 1112.70 1144.34 1644.37 2361.95

LOANS
Secured 16.11 7.14 2.13 2.78 74.99 16.21 79.91
Unsecured 9.92 0 0.00 0.00 0.00 0.00 0.00
Total Loans 26.03 7.14 2.13 2.78 74.99 16.21 79.91

TOTAL FUNDS EMPLOYED 308.27 327.58 143.86 1115.49 1219.34 1660.58 2441.86

HO A/C/BRANCHES A/C 3098.08 2885.81 3461.23 3622.30 4440.53 7408.95 8515.22

               
TOTAL 3406.35 3213.39 3605.09 4737.79 5659.87 9069.53 10957.09

76
 BALANCE-SHEET CONTINUED

PARTICULARS 2014 2015 2016 2017 2018 2019 2020

APPLICATION OF FUNDS

FIXED ASSETS
GROSS BLOCK 2497.49 2682.93 2691.53 2746.13 2761.26 2790.42 3407.01
LESS DEPRICIATION 229.16 369.22 513.86 662.44 806.66 1064.51 1235.64
NET BLOCK 2268.34 2313.71 2177.67 2083.69 1954.60 1725.91 2171.37
CAPITAL WORK IN PROGRESS 129.00 97.53 150.77 851.04 2225.78 5379.57 6769.48

TOTAL OF FIXED ASSETS 2397.34 2411.24 2328.44 2934.73 4180.38 7105.48 8940.85

INVESTMENTS 0 0 0 0 0 0 0
CURRENT ASSETS/LOANS AND ADVANCES

CURRENT ASSETS
INT. ACCURED ON
INVESTMENTS 0.00 0.00 0.00 0.00 0.00 0.00 0.00
INVENTORIES 1234.49 769.62 1166.88 1740.80 1646.13 1849.92 2029.37
BOOK DEBTS 0.00 0.00 0.00 0.00 0.00 0.00 0.00
CASH & BANK BALANCE 0.00 0.00 0.00 0.00 1.24 0.99 1.24
LOANS AND ADVANCES 11.82 171.83 242.69 233.23 248.62 449.56 361.05

TOTAL OF CURRENT ASSETS 1246.31 941.45 1409.57 1974.03 1895.99 2300.47 2391.66

LESS CURRENT LIABILITIES 237.30 140.27 133.55 171.42 416.90 336.99 376.03

NET CURRENT ASSETS 1009.01 801.18 1276.02 1802.61 1479.09 1963.48 2015.63

Defered Revenue Exp. 0 0 0.96 0.64 0.43 0.86 1.01

Less: ADJ as per ho 0 0 0.1 0 0 0.02 0.02
Add: exp incuured during the year 0 1.19 0 0 0.24 0.07 0.00
Less: Amortised during the year 0 0.24 0.21 0.21 0.26 0.33 0.38

Total defered revenue 0 0.95 0.65 0.43 0.41 0.578 0.608

INTER DIV./UNIT BALANCE 0 0 0 0 0 0 0

TOTAL 3406.35 3213.37 3605.11 4737.77 5659.88 9069.53 10957.09

77
78
BIBLIOGRAPHY

www.google.co.in

BOOKS NAME AUTHOR NAME

Mgt. Accounting & financial management R. K mittal (V. K publication)

Management accounting shashi .k. Gupta(Kalyani Publication)
Financial management Khan & Jain( Tata McGraw Hill)
Research methodology C. R Kothari.(Wishwa Prakashan)

79