Professional Documents
Culture Documents
Of
Kohinoor Chemicals Company Bangladesh Ltd. & Marico Bangladesh
Ltd.
Course Title: Business Finance
Course code: FIN 201
Section 03
Submitted to
Leo Vashkor Dewri (LVD)
Senior Lecturer
Department of Business Administration
East West University
Submitted by
Name ID
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Letter of Transmittal
2 January, 2020
Leo Vashkor Dewri
Senior Lecturer, Department of Business Administration
East West University
Subject: Submission of Report
Dear Sir,
Dear Sir, we are submitting the final term paper on Kohinoor Chemicals Company
Bangladesh Ltd. & Marico Bangladesh Ltd” which you authorized. The term paper
is descriptive cum analytical in nature. In the preparation of the term paper we
strictly followed all your instructions & requirements. While making this report we
came across many hurdles and pleasant experience. But valuable experiences we
have gained during the period will undoubtedly benefit us in the years ahead.
Despite the several constraints, we gave all of our efforts to make this report a
meaningful one.
We have tried sincerely to comprehend and translate our knowledge in writing this
report.
Sincerely,
Mohona Ahamed 2016-2-10-116
Saiful Alam Forhad 2016-2-10-177
Panna Akter 2018-1-13-060
2|Page
Contents
Letter of Transmittal ..................................................................................................2
Introduction ................................................................................................................4
Strategy and Forward Planning ..................................................................................5
Ratio Analysis ............................................................................................................6
Profitability & Efficient Ratio ...................................................................................8
Liquidity ..................................................................................................................8
Financial structure...................................................................................................8
Short-term solvency ................................................................................................8
Activity Ratio ..........................................................................................................9
Financial leverage Ratio .........................................................................................9
Competitor Analysis: ..............................................................................................9
Non Financial Performance: ....................................................................................11
Corporate Social responsibility: ...........................................................................11
Environmental and CSR policy: ...........................................................................11
HR & Social Responsibility .....................................................................................13
Conclusion ...............................................................................................................14
Reference..................................................................................................................15
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Introduction
Most of the products of KCCL are known by the legendary brand name Tibet. A
number of its other brands, such as Sandalina, Genstar, Bactrol, Ice Cool, Fair &
Care, Xpert, Heel Guard and Clean Master are equally famous in Bangladesh.
Kohinoor Chemical Company (Bangladesh) Limited (KCCL) has not only emerged
as a potent industrial entity, but also represents the brand of the mass people.
Intensifying quality production and penetrating new markets both at home and
abroad, the company advances forward with the introduction of new products and
further development of its existing items.
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Strategy and Forward Planning
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Ratio Analysis
Activity Ratios
Total Asset Turnover 1.92 1.75 1.84 2.98
2.19
Receivables Turnover 20.13 12.79 35.66 55.54
155.7
8
Average Collection Period 18.13 28.53 10.23 6.57 2.34
Payable Turnover 1.02 0.96 1.07 1.36 1.39
Average Pay Period 357.6 379.82 341.85 267.41 263.0
4 5
Inventory Turnover 4.10 2.46 2.75 30.76 2.22
Days in inventory 89.07 148.20 132.70 11.87 164.5
8
Cash Coverage
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Cash Coverage Ratio 1.06 1.05 1.04 1.06 1.06
Profitability Ratios
Net Profit Margin 0.23 0.21 0.21 0.20 0.18
Return on Assets 0.44 0.37 0.39 0.60 0.40
Return on Equity 1.55 1.10 0.92 0.83 0.79
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Profitability & Efficient Ratio
We can see that Marico Bangladesh Limited Industry’s 2017 current ratio was 1.39
times. It reduced to 1.30 times in 2018 and further reduced to 1.22 times in 2019. It
happened because the current assets of the company was decreased from 2017 to
2018 but it increased in 2019 more than 2017 but on the other hand the current
liabilities was increasing at a significant rate Specially in 2019 it just high jumped.
They need to reduce their current liability otherwise the current ratio will be
decrease more in the next year.
Liquidity
The Company's approach to managing liquidity is to ensure, as far as possible, that
it will always have sufficient cash balances or liquid and marketable assets to meet
its liabilities when fall due, under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the Company's reputation.
Typically, management ensures that it has sufficient cash and cash equivalent to
meet expected operational expenses, including the servicing of financial obligation
through preparation of the cash forecast, prepared based on time line of payment of
the financial obligation and accordingly arrange for sufficient liquidity/fund to
make the expected payment within due date.
Financial structure
The gearing ratio and interest cover ratios are slightly improves and Marico
Bangladesh Limited is capable to repay loan and interest owing to decrease the
amount of long Term liabilities and increase the figure of equity as well as raise the
amount of Profit before tax and interest. But, if the company fail to generate higher
Profit rapidly than Marico Bangladesh Limited might face financial difficulties in
short term period. In these circumstances,the firm can ask shareholders to invest
more capital Or retain dividend to mitigate any financial crisis.
Short-term solvency
Short-term solvency ratios indicate whether a company’s cash flow is sufficient to
meet its short-term liabilities. we can see that from 2015-2016, the short-term
ratios were increasing which means Marico Bangladesh Limited cash flow was
sufficient to meet its short-term liabilities. But from 2017-2019, the short-term
ratios were increasing at the same time decreasing significantly which means
Marico Bangladesh Limited cash flow might face problem in up coming year if
they fail to generate more profit to cover up the debt.
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Activity Ratio
Activity ratios indicate how efficiently a company is leveraging the assets on its
balance sheet, to generate revenues and cash. we can that from 2015-2017, the
activity ratios were somehow constant which means Marico Bangladesh Limited
was not doing anything for the improvement of leveraging the assets on its balance
sheet, to generate revenues and cash. But from 2018-2019, the activity ratios were
decreasing significantly which means the company was not efficiently leveraging
the assets on its balance sheet.
Financial leverage Ratio
Financial leverage which is also known as “leverage” or “trading on equity”,
refers to the use of debt to acquire additional assets. From the above scenario we
can see that financial leverage of Marico Bangladesh Limited was increasing from
2015-2019 which means if the value of the assets of Marico Bangladesh Limited
increase which will increase stock volatility also it increase risk and at the same
increase high return.
Competitor Analysis:
Kohinoor Chemical Co. short term solvency ratio for the year 2019 was good as
compare to Marico Bangladesh Limited which means company’s cash flow is
sufficient to meet its short-term liabilities.We have mentioned above that Marico
Bangladesh Limited short term solvency increasing from 2015-2019.Activity
Ratio of Kohinoor Chemical Co. is creasing because their total operating revenue
is increasing which is 54.39 on the other hand for Marico Bangladesh Limited the
total operating revenue is 20.13.Inventory turnover for Kohinoor Chemical Co. is
79.63 on the other hand Marico Bangladesh Limited have 89.07.Financial leverage
is basically use of debt to acquire additional asset for Kohinoor Chemical Co.
Financial leverage is not that good if we compare with Marico Bangladesh
Limited.However Cash coverage ratio and Profitability ratio is high for Marico
Bangladesh Limited as compare to Kohinoor Chemical Co. which shows that the
firm Marico Bangladesh Limited is doing well by generating revenues,profit and
enough cash flow.
Particulars 2019
Cash flows from operating activities
Collection from customers 8,822,012,157
Payment to suppliers and for operating expenses -5,601,612,652
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Cash generated from operating activities 3,220,399,505
Interest paid -13,791,469
Interest received 160,886,164
Income tax paid -638,320,374
Net cash from operating activities 2,729,173,826
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Non Financial Performance:
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Limited operates or the environment. This leads Marico Bangladesh Limited to be
socially and environmentally sustainable. Various projects under Marico
Bangladesh Limited CSR pillars are designed by its management committee which
falls under corporate strategy.
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HR & Social Responsibility
KCCL is committed to cater to the healthcare needs of the nation. This commitment
demands immense socials responsibility of ensuring quality in terms of quantity,
purity, stability, safety, efficiency and presentation of the product. At every stage of
the production, stringent control mechanism involving raw material testing, in-
process quality control, packaging, labeling, finished product testing as well as
stability monitoring and documentation is maintained to ensure the highest quality
product consistently.
Cosmetics is directly related to human life and therefore, its manufacturers have
immense social responsibility of providing safe and effective medication. From its
very inception, KCCL has always emphasized the need for uncompromising quality.
KCCL commitment to quality is clear from its progressive use of state of the art
manufacturing technology. BPL’s priority is to build a healthier tomorrow for the
nation.
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Conclusion
Most of the local industries in Bangladesh do not practice the Strategic Human
Resource Planning. Organization should establish HR department which will work
on different HR issues like ‘Development of HR policies’ ‘ Development of
Performance System’, ‘Development of job description & Specification’, Training
& Development’, etc should ensure the proper implementation of the policies and
system. Kohinoor Chemical Co. (BD) ltd has implemented the HR policy, they
developed their SHRp and modified. They also make new reward policy to
motivate their employees. They follow almost every step of SHRP but they have
also some lacking. They should introduce HRIS system properly and should
balance their manpower as soon as possible for their betterment. They should
maintain the policy and after getting the feedback should take steps according to
those.
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Reference
1. http://www.kohinoor-bd.com/
2. https://www.lawyersnjurists.com/article/a-case-study-on-kohinoor-chemical-
co-bd-ltd/
3. https://marico.com/bangladesh
4. https://www.lankabangla.com/
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