ACKNOWLEDGEMENT

First of all we would like to thank

Almighty Allah, Who helps us

in every aspect of life and then we are very thankful to our respected teacher

SIR.USMAN who provided us the opportunity to learn the new ways
of research and to integrate the researched market data. I am also thankful to

YASIR USMANI & TASNIM

HAIDER who are Marketing & Finance manager of NISHAT TEXTILE
MILLS and all the people that help us in any way to collect the data and understand the information on which we have made the projections and summaries.

Executive Summary
Nishat has grown from a cotton export house into the premier business group of Pakistan with 5 listed companies, concentrating on 4 core businesses; Textiles, Cement, Banking and Power Generation. Today, Nishat is considered to be at par with multinationals operating locally in terms of its quality products and management skills.

The difference between the success & failure is doing things right and doing things nearly right, & NML has always tried for success & that is why it is known to be one of the leading organizations in Pakistan. It is discuss about the 7ps. We have conducted all the financial ratios of the company and interpreted them. And analysed all the internal and external factors that are affecting the company profile. We have analysed space , BCG , IFE & grand strategy matrix.we have described the main factors of the value chain and cooperate governance. At the end we have made some recommendations.

INTRODUCTION OF TEXTILE SECTOR
THE PAKISTAN TEXTILE INDUSTRY
According to the Pakistan Ministry of Textiles, an export target of 13 billion USD has been fixed for the year 2008-09. Hence, the textile units in Pakistan have an opportunity to expand the scope.

ESTABLISHED CAPACITY
The textile industry of Pakistan has a total established spinning capacity of 1550 million kgs of yarn, weaving capacity of 4368 million square meters of fabric and finishing capacity of 4000 million square meters. The industry has a production capacity of 670 million units of garments, 400 million units of knitwear and 53 million kgs of towels. The industry has a total of 1221 units engaged in ginning and 442 units engaged in spinning. There are around 124 large units that undertake weaving and 425 small units. There are around 20600 power looms in operation in the industry. The industry also houses around 10 large finishing units and 625 small units. Pakistan¶s textile industry has about 50 large and 2500 small garment manufacturing units. Moreover, it also houses around 600 knitwear-producing units and 400 towel-producing units.

CONTRIBUTION TO EXPORTS
According to recent figures, the Pakistan textile industry contributes more than 60% to the country¶s total exports, which amounts to around 5.2 billion US dollars. The industry contributes around 46% to the total output produced in the country. In Asia, Pakistan is the 8th largest exporter of textile products.

CONTRIBUTION TO GDP AND EMPLOYMENT
The contribution of this industry to the total GDP is 8.5%. It provides employment to 38% of the work force in the country, which amounts to a figure of 15 million. However, the proportion of skilled labor is very less as compared to that of unskilled labor.

Textiles Exports from Pakistan

Textiles constitute a major exporting sector for Pakistan, which accounts for about 60%of the country¶s total foreign exchange earnings. The major export items are yarn; gray Cloth, finished cloth, towels and bed sheets and their major customers are the USA, EU, Japan and Hong Kong. Many textile

exports take place under quota arrangements With the EU and the United States. Gray cloth constitutes roughly 16- 18% of total cloth.

Exports from Pakistan.
Nishat gray cloth exports account for roughly 20 % of Pakistani gray cloth exports. The firm has been exporting to the USA for many years, and has only recently started to export to EU countries. In Pakistan, the cotton crop season runs approximately from August to March. Prices are generally high at the start of the season in August/September, and fall later on as supply increases. Following income tax law, the fiscal year runs from October to September for textiles sector.

History
NISHAT MILLS LIMITED (NML) commenced business in 1951 as a partnership concern, which was converted into private limited company in 1959. In 1961, the company went public and was listed on the Karachi stock exchange, the only stock exchange in the country at that time. NML started out as a weaving unit with 500 semi-automatic looms; later 10000 spindles were added, laying the foundation on nation¶s biggest textiles composite project. Composite project at Nishat mills limited Faisalabad covering 98 acre of land is providing all production process under one roof i.e. spinning, weaving, processing, stitching and power generation.

The Founder
A man of vision, courage and integrity, Mian Mohammad Yahya was born in 1918 in Chiniot. In 1947 when he was running a leather business in Calcutta, he witnessed the momentous that swept the indo-pak sub-continent and resulted in the emergence of Pakistan. Like many of his contemporaries, he also migrated to the new country to help establish its industrial base. His is a story of success through sheer hard work and an undaunted spirit of enterprise. Beginning with a cotton export house, he soon

and finishing. engraving. The processing includes dyeing. for their investors. and team spirit of its employees. for their customers. with wide ranging interests. delegation of authority. Textiles. dedication. He was elected Chairman of All Pakistan textile Mills Association (APTMA). The textile capacity of the group is the largest in the country.Nishat Mills Limited Firmly believing in µGrowth through Professional Management¶ our corporate culture is based on decentralization. He died in 1969. . continues the spirit of entrepreneurship and has led the group to become a multi dimensional corporation. the chairman of Nishat Group. weaving. and Nishat is no exception. 100 new air jets looms and new dyeing plant has increased the existing capacity of 24000 spindles. Today. chemicals and insurance. 740 looms and dyeing and finishing capacity of 5 million meters. 4 . Banking. like his father. It is our conviction that every successful organization is a reflection on the commitment. Nishat has grown from a cotton export house into the premier business group of the country with 5 listed companies. cotton and jute textiles. for the environment. for the community and for their employees. Our people are all imbued with the spirit. processing. encouraging the acceptance of responsibility and inculcating quality consciousness. and Power Generation. TEXTILE CAPACITY Production process consists of spinning. for their shareholders. Nishat is considered to be at par with multinationals operating locally in terms of its quality products and management skills. for it is with them that Nishat has achieved so much success in last fifty years. at the age of 51 having achieved so much success in so short period. a fact manifested in our rapid growth and low turnover Nishat continue to strive to be a better group today than what they were yesterday. the prime textile body in the country. Cement. The group is the largest exporter of textile products from Pakistan for more than a decade. An addition of 20000 new spindles. The Chairman Today Mian Mohammad Mansha.branched out into ginning. concentrating on 4 core business.

Badar-ul-Hassan COMPANY SECRETARY:  Mr. Aurangzeb Khan. Muhammad Nawaz Tishna (NIT) Mr. Advocate. Khalid Qadeer Qureshi Mr.Export Oriented Organization Nishat mills limited are an export-oriented organization. Faisalabad Road. (Weaving units & Power Plant)  Sheikhupura. 21 K. Faisalabad (Spinning units and Power Plant)  12 K. M. COMPANY INFORMATION BOARD OF DIRECTORS:        Mian Umer Mansha Chairman/Chief Executive Mian Hassan Mansha Mr. Europe and United States. Khalid Mahmood Chohan AUDITORS:  Riaz Ahmad & Company Chartered Accountants LEGAL ADVISOR:  Mr. Muhammad Azam Member  Ms. Muhammad Azam Rana Muhammad Mushtaq Ms.  Chamber No. District Court.M. Faisalabad.M. Lahore. Nabiha Shahnawaz Cheema Member CHIEF FINANCIAL OFFICER:  Mr. 6. Nishat mills limited exports more than 90% of its products mainly to the Far East. MILLS:  Nishatabad. Ferozepur Road. Khalid Qadeer Qureshi Chairman/Member  Mr. Nabiha Shahnawaz Cheema AUDIT COMMITTEE:  Mr. (Stitching unit) .

Feroze Watwan REGISTERED OFFICE  Nishat House. SHARES DEPARTMENT  53 . 5 K. Nishat mills limited is ideally located in. 042-111 113 333  Fax: 042-6367414 HEAD OFFICE:      7.com LIAISON OFFICE:  Ist Floor. Karachi Chambers. Nishat Avenue (Weaving.M.K. Lawrence Road. Ferozepur Road.com Website: www.M Ferozepur road Lahore. Dyeing & Finishing unit. Main Gulberg. 5 K. Karachi. Processing unit.nishatmillsltd.K. 042-111 332 200 Fax: 042-5716349-50 E-mail: nishat@nishatmills. Nishatabad Faisalabad. Sheikhupura Faisalabad (Spinning unit) Road.  Tel: 042-6367812-16.A.M.  Off 22 K.M Nishat Avenue Lahore.  Tel: 021-2414721-23 Fax: 021-2412936 Plant location Plant location is one of the main long-term strategic decisions normally taken by top management.M. 12. Lahore. . Lahore.M Faisalabad road Shiekhupura. Lahore. 21. Stitching unit and Power Plant)  20 K.  Hasrat Mohani Road. Tel: 042-5716351-9.

. weaving. Composite unit means all the process i. It is a composite unit. finishing and stitching units.M ferozepur road Lahore. To transform the Company into a modern and dynamic power generating Company with highly professionals and fully equipped to play a meaningful role on sustainable basis in the economy of Pakistan.M Shiekhupura Faisalabad (ferozewatan) Main factory is located at Niashatabad. processing. Vision Statement To transform the Company into a modern and dynamic yarn. Product process includes spinning. 20-K.K.e.Off 22. cloth and processed cloth and finished product manufacturing Company with highly professionals and fully equipped to play a meaningful role on sustainable basis in the economy of Pakistan. from spinning to stitching takes place under one roof.

. so as to achieve optimum prices of products of the Company for sustainable and equitable growth and prosperity of the Company.Mission Statement To provide quality products to customers and explore new markets to promote/expand sales of the Company through good governance and foster a sound and dynamic team.

Mission statement Analysis of Nishat texitle components of mission statement Customer NO product /services NO Markets NO Technology Philosophy NO NO self concept concern of employees concern of public image NO YES YES concern of survival growth and profitability YES ..

2. Gas and Power shortage). It is becoming difficult to maintain our performance in the present scenario. Our strategy in this competition was to diversify ourselves customer wise. Most of the Spinning mills remained in a serious cotton crisis through out the year. We faced a lot of difficulties to win the business in international market because of high raw material prices. showed good response in terms of demand and prices of carded & combed yarn. Installation of state of art ring frames is under way at one ofour spinning units. however. Fareast market showed difficult on ground of price. Far East remained our main selling market of cotton yarn. Cotton prices started with Rs. increased our cost of production and held our product uncompetitive in international market. 4. Moreover. Another strategy was to cut costs by bringing innovative technologies. This was the only way to survive in such uncertain market.000/ maund during this year.Spinning Section The year 2009 mainly started with difficulties in the shape of the bullish and uncertain cotton market. . market wise and product wise. Business in South America reduced by 80% in comparison with previous period because of the bullish yarn market and cheaper prices from competitors. by the end of year. Ever highest cotton prices were seen this year in Pakistan. Weaving Section During the year under review. Development in terms of machinery is in progress for better quality of yarn. we have observed highest ever yarn prices which made the job more difficult. USA had some steady demand during this year. political instability. We have. law and order situation and energy crisis (Oil. by passed these crises by following our one time cotton buying policy and same has also helped us to maintain steady quality results.900/maund and went up to Rs. The increases in the yarn price was not absorbed by the fabric prices. far east market. Our wider width looms / home textiles greige capacity continued facing decline in prices. where as in Europe demand of cotton yarn was reduced more. Demand of 100% grey cotton yarn remained steady and we tried to uphold the prices along with market and to keep over all spinning in profits. We continued to replace our old looms with the new state of the art looms and got new looms in different widths to meet the varying requirements of all our customers.

Nishat Dyeing & Finishing ± (NDF) Given the circumstances of textile industry and all challenges. Dan River. NDF managed to perform quite well. an important step was taken by shifting the Faisalabad stitching unit to Lahore. retaining the current major customers. which hindered new ventures. Unanticipated bankruptcy of some major textile businesses including. recession of American market further slowed down the entire business cycle.Processing and Stitching Section The year 2009 was a difficult year for fabric processing mills as in addition to the domestic challenging scenario. Retailers were stuck up with high inventory levels. Goody¶s Family Inc also gave unprecedented setback to an already fading market. NDF has formulated the key principles follow in the next fiscal year. NDF not only managed to retain all its major customers despite the cut throat price competition. . As much as it is hard to establish a firm marketing strategy in such a volatile market. A particular focus was conferred upon enhancing production efficiency are drawing more production in less number of hours and with optimum workforce. This increase in customer base was both due to the complete verticality offered to customer for fabric till finished garments. Thereby the low demand by existing customers due to poor retail was covered well by addition of this new business. as well as to the increased marketing activities on tapping new customers. This situation did not allow suppliers to increase any prices to overcome excessive overhead costs and ease out the worsening condition. All the factors contribution to the current inflationary pressures and weak demand are still present and far from being settled. Linen & Things. The overall picture is not expected to improve Much in the next fiscal year as in the market still remains highly unstable. With reference to this cost cutting strategy. Even though all major concerns were facing a perpendicular decline in the revenues. These revolve around a further expansion in its customer base. increasing marketing efforts in the still profitable European market and concentrated effort towards specialized finished over regular run-of-the-mill products to fetch better margins. adjacent to the processing plant. our company was able to sustain its sales in step with the plant efficiency. but also increased its customer base both in US as well as in Europe.

besides generating power these plants are producing steam for use in processing. Poor law and order situation is a serious threat for Pakistan textile industry. Changing tax rates are also effecting our textile sector.823 million as compare to last year Rs 737. Import and export restrictions is barrier for the development of textile sector. High cost of production due to higher cotton prices 20% increase in imported input prices. Out of the total generation capacity. for further power generation and hot water for process use or air conditioning. We have always concentrated on installation of most modern and efficiency to power generation machine to get more with less fuel consumption. Economical y y y y y y Devaluation of dollar against rupee played a key role in improving sales and resulted in higher profitability in previous year which is $1137.Power Generation Nishat has 80 MW of self power generation facilities at different sites.82% which is Rs 546. Pest Analysis Political y y y y y Marshal law is always being threat to our industry.156 million. . This concept makes it possible to use the precious energy to to maximize profitability of the company and help reduce environmental pollution. Due to the rapid change in government every government sets its own trade policies. Keeping in view the current power shortage in the country. Nishat has responded to beckon of the Government and sold its excessive power from different locations to the local distribution companies.e.1790 But in current year it remains stable in against rupee and eventually caused lower profitability which is $1010. 46 MW generation is done through most modern and highly efficiency gas fired generators and their design is based on ³trigeneration´ concept i.491 Increase in consumption rate of local and imported cotton raised the production cost as compare to previous year. Finance cost decreased by 25. Decrease in the prices of grey fabrics due to fluctuating currency rate which decreased the profitability.

But the other countries are getting more than these prices and in these countries Bangladesh is on top that is getting $3. Expansion of production capacity at one unit by installing 50 new state of the art toyotel air jet looms which are operationalized in march 2010 Latest yarn dying plant is installed with the capacity of 7 tons a day. On other hand government has increased gas and petroleum prices. Although we are offering lowest prices but due to poor quality and present condition off the textile industry. If we see the export to USA of textile industry from all over the world and especially from asian countries then we can easily found that Pakistan is offering most less export prices to USA which is $0. The buyer demanding more and improved quality in very cheap price weather customer are from foreign or are from local market. The competition at international level as increased to much.Social y y y Increasing competition from regional countries. Pakistan is losing customer for there textile industry. As our local cotton is not enough to fulfill all textiles so the bargaining power is increased. Increasing abrasive fabric business mainly due to rival of the car industry. Due to which local suppliers are getting edge and providing raw material at expensive price. . Focused to add further value added product and system. Higher prices are causing buyer extremely cautious in placing order Technology y y y Coupled with nishat capability and competency vertical production facility that can convert raw cotton to final finished consumer product always attract attention of customer.91 per-meter. y y 5 Forces model Bargaining power of buyer The bargaining power of buyer is increasing day by day. Bargaining power of supplier Bargaining power of supplier is increasing as Pakistan government has put a barrier on import of raw material for textile which is reduced up to 70%. Nishat has upgraded its machinery with erection of most modern and efficient ring frames and cone winding machines in two spinning units and further replacement of similar machines of other units to help increase in automation and reduce labour cost and produce better quality yarn.15 per-meter from USA.

The textile mills are competing with each other on the basis of their prices they offer for the quality which they produce. Technology is also very expensive due to higher dollar prices. Competition at international level is very furious for Pakistan textile industry. But now a days some local designers and companies have started there on designed production. political instability is also playing a key role of barriers to new entrance. But it is neglected as new company has to face a number of challenges and competitors in the market. Threat of substitution Textile products and cloths are basic necessity which has no substitute. are very high.Rivalry The competition in the textile industry is becoming very tough. they can be substitutes but not a big threat for the company. 1) 2) 3) 4) 5) 6) 7) China Indai Vietnam Bangladesh Korea Pakistan Iran Threat of new entrance Threats of new entrance is always there. The products they are making is according to peoples and customer demand. Bareeze . fuel . needles impression etc. . And existing companies are already a big giants for new entrance. 1) 2) 3) 4) 5) 6) 7) Nishat textile Saphire textile Chenab textile Kohinoor textile Al-karam textile Sitara textile Gulistan textile In international market major countries are. Such as Aroshe . The major exporter¶s for textile products are.. On the other hand prices of labour .

21 2 0.16 1 0.15 2.20 Organized and work 0.16 3 0.15 that is slightly above from the average.10 3 0.36 3 0.07 2 0.20 Advertising 0.16 Total Analysis 1. Sapphire also better than Azgard9.24 Modern tools 0.07 3 0.45 The average total weight is 2.36 On time delivery 0. That is showing that better than Sapphire and Azgard9.00 3.12 3 0.10 3 0.5.20 2 0. Sapphire score 2.14 0.52 3 0.65 2.36 2 0.21 Financial position Market share systematic 0.21 3 0.16 2 0.39 3 0.The result for CPM matrix is Nishat score 3.39 3 0.30 2 0.45.08 2 0.14 2 0.20 2 0.Competitive profile matrix Nishat Critical success factor Weight Rate Sapphire Azgard9 Score Rate Score Score Rate Product quality 0.52 3 0.48 3 0.65 and Azgard9 score below average 2. .24 2 0.39 Design 0.08 2 0.16 Management skill 0.13 4 0.36 3 0.30 2 0.14 2 0.12 4 0.13 4 0.39 Customer¶s 0.

33 Organization Can expand product 0.12 2 0.10 market segments around the world 4 0.18 0.EFE MATRIX FOR NISHAT TEXTILE KEY EXTERNAL FACTORS OPPERTUNITIES Weight Rate 3 Score 0.40 Potential of sales increase through 0.00 2.33 Changed of government policies TOTAL 1.09 quality services and in time delivery 2 0.08 local market 3 0.80 .18 Introduce its garments in the 0.30 0.24 Organization Can hire more welleducated and experienced person Organization Can reduce the cost 0.10 0.11 3 3 2 3 0.09 0.30 Organization Can capture new 0.10 by proper utilization of resources 3 0.24 Threats New entrance Political instability Economic instability 0.30 0.10 0.11 lines 0.

10 skilled management 4 0.27 0.80 that is slightly above from the average.36 Own power generation .5.40 Adequate resources financial 0.09 3 4 0. IFE MATRIX KEY INTERNAL FACTORS Strength Strong Security System Weight 0. That is showing they can effectively take advantage of existing opportunities and can minimize the adverse effect of external threats.20 Highly qualified and 0.40 Quality products 0.48 Better delivery of services 0. 4 0.The result for EFE matrix is 2.09 0.12 4 0.Analysis The average total weight is 2.30 Latest mechanized 0.10 Rate 3 Score 0.10 machinery.10 3 0.

05 2 0.00 2. There are different hidden security cameras which capture the all moments.05 Small international 0.10 market share 2 0. yStrong Security System Nishat textile limited has a greater security system.5 and our score is 2.10 TOTAL 1.weakness High cost of production 0.20 Centralized making decision 0.96 Analysis For the matrix the average score is 2.10 2 0. Detail of SWOT Analysis Strengths: yISO 9001-2000: Nishat textile is certified under ISO 9001-2000 and so it meets the requirement of international standard and has a value in the mind of concern people.This means that the Nishat textile is above in its internal strength.96 which is above average so this above average score show a strong internal position of the Nishat textile.05 1 0. .20 Less activities promotional 0.

And being an old textile company people are loyal with it. yAdequate financial resources The owner of the Nishat is one of the richest persons of the Pakistan and they have more plant and investment in other industries like cement. yTremendous market positioning Nishat textile is one of the pioneer textiles in the Pakistan so it got the position in the mind of its customer. Bank. . yHighly Motivated Workforce They are providing better pay to their employees and also bonus to them which motivate the workforce and they are doing well at work setting. They are using modern looms which they have purchased from Japan and France. yOKTEX 100: Nishat is also Oktex 100 certified its mean that Nishat is satisfied to not using hazard chemical using. yCompetitive advantage Because it is an old textile and it has still keep its position in the textile market on all others competitors in the nation wide which is its competitive advantage. yHigh quality product Nishat textile limited using advance technology like they have modern machinery by which the quality of product produced is very high. yHighly qualified and skilled management The management of Nishat is skilled they have hired the foreign graduate people in their management and also experienced people from all over the country. Nishat has a better position in the mind of its customers. And by using that latest machinery the productivity of the employees are very high. yLatest mechanized machinery. They have adequate financial resources to meet their requirements.

Weaknesses: [ yHigh cost of production The production cost is high because of not properly utilization of its resources. . yCentralized decision making The decisions are made by the upper management which is weakness of the Nishat because they have no proper idea about the situation and their decision can be not fruitful for the company. Bangladesh etc the international image in the textile sector is very weak. ySmall international market share Although Nishat has very strong in the national wide but it has small market share in the global textile industry due to the sound competitors like china. and Bangladesh etc [ yLess promotional activities The advertising and promotional cost of the Nishat textile is very low it can take advantage for more turnouts. Those countries providing cheap product to the market then Pakistan¶s textile industries. yEquipped with MIS System They have a management information system by which the departments and employees are connect with each other and they have a data ware house by which they can share their resources easily. yOwn power generation plant They have own power generation plant and Nishat is the pioneer in the private organization who start the power generation. yWeak image in the international market Because of the other textile specialized countries like China. And also selling to the WAPDA its produced power.

It has to develop a further systematic process for controlling and managing resources.yLack of benefits and rewards for the employees Some facilities that other providing to their employees like Transport and medical fee etc Nishat not providing to their employees because of which the productivity of the employees decrease. yOrganization Can reduce the cost by proper utilization of resources If the cost of different matters which is not utilizing properly is controlled by the Nishat management they can produce more in a few costs. And they also have better market repute. . They have plants and the extra cost for the production will be low for Nishat. Threats: yBuyer needs demands changes Because of the research and development the design and the product of Nishat is just satisfactory as compare to competitors in the globally and they are not fulfilling the demand of customer. yChanged of government policies Government policies are changing day to day so it is a threat for the Nishat to survive in such a changeable situation. Opportunity: [ yOrganization Can expand product lines Currently the Nishat not dealing in knitwear they can expand their product line by producing knitwear. yPolitical instability Political instability effects the Nishat because of the quota system the company can be restrict by the government to export. fresh and energetic staff for their betterment. yOrganization Can hire more well-educated and experienced person They can take advantages by hiring more skilled people and they should hire young.

2. yGlobally Economic instability Because of the economic instability the Nishat affected a lot. 3.s There are the following 7p. BEDDING Sheet sets Quilt cover sets . 7. 5. 4. Product Price Place Promotion Packaging Positioning People 1-PRODUCT  PRODUCT LINE Products line of Nishat mills limited consists of following items. Dumping system which is rising on daily basis in the world can create many problems for the company and any uncertainty in the world like 9/11 may affect also the overall export. 1.s. 7P. 6.

Bed spreads Comforters Bed skirts Oxford pillow cases Blanket covers Sleeping bags CURTAINS & ACCESSORIES Embroidered curtains Pencil pleat tape curtains Pinch pleat lined & unlined curtains Tab top & rod pocket curtains Assorted pelmets and window dressings Oxford cushion covers Frilled and piped cushion covers Frilled. piped and pleated tie backs .

Nishat is famous for its fabric. Fabrics which are available in market are cotton. Winter designs of satin.TABLE. In above picture winter variety is shown by maira Hassan. . Grey fabric is the form of fabric which is in finalized condition means it has gone through the process of spinning . FURNITURE & KITCHEN ACCESSORIES Tea cozy Table mats Table cloth and napkins Aprons Kitchen gloves Pot holders Chair pads with circle tacks Couch cove Nishat textile¶s main products are grey fabric and abrasive fabric. lawn and satin. dying. Abrasive fabric is processed fabric but is not in finalized form.

. which ensures quality products to their customers. lawn. they bring success to firms. Quality Planning Effective planning is required for the success of organization. Standard Operations Nishat mills limited have established a quality control lab. 2-PROMOTION When ever you think about quality and style a suddenly you will get a name of nishat. Objective at Nishat is to provide only quality products to their customers. If plans are well planned. However is Nishat is promoting its product through fashion magazines. cotton . Maira Hassan is brand ambassador of Nishat satin. These promoting adds are published according to the season. III. styleablaze and some other magazines more over nishat participates in fashion shows at Karachi. These adds are published in style360 . and some other varieties. Standardization of work is necessary for achieving effective certification.QUALITY SYSTEM I. That¶s why they achieved quality certification like ISO 9001. For this production and planning department has been established. Nishat is promoting its product through models who are showing the variety of nishat satin. System Procedure ISO 9001 requires that there should be proper system for each work. II.

beautiful browns. Through negotiation you win the sympathy of buyers and business for the company.When one think of winters. eternal whites possess center place. This strategy helps manager to understand the needs and requirements of buyers as well as marketing people are aware of current trends of market. Nishat Textile Mills are among the few great names in Pakistan¶s Textile Industry. it¶s like a rainbow of colors that appear in mind which primarily include brilliant shades of red. introducing Nishat products to prospective buyer. mustard yellow hues. Meeting with buyers Marketing manager meets with buyer. produce high quality fabrics and flirt with glorifying colour. 1. burgundy. and among other rather darker riches hues. wild orange. .

Free Samples This strategy is widely used to boost up exports. Customer¶s satisfaction is a important aspect because customer is a person who gives meaning to company. Nishat has long list of its agents working in foreign market. More that 85% of its sales constitutes exports. This booklet is send to various agencies dealing in purchase of cotton. Nishat aim is to provide best quality at lowest price. Company Profile Nishat mills limited has also published it profile introducing its key products to customer. This strategy helps to introduce the company in out side world. When new product is made. 3. It is providing grey fabric at $0. This strategy is useful when company is not able to communicate with buyers. So to capitalize foreign market. 3-PRICE Nishat is providing its product at lowest price all over the world. free samples are sent to loyal customer to show firms concern for them. it can hire services of agents who for commission introduce their products in market.2. Relationships with distributors or agents are recognized as critical success factors so lot of importance is paid to agents who are valuable asset of firm. Nishat is offering for their valuable customers. . By comparing it to other industries of Pakistan you will came across a fact that Nishat is providing better quality at low price. 5. Theses visits are crucial for the growth of the company because they help in introducing products to others and also win a lot of business for the company. Buyers Visit Sometimes buyer¶s visits are arranged to familiarize them with products. Contacts with Agents Nishat mill limited is an export-oriented organization. fabrics and made-ups. Nishat marketing department frequently invites buyer to show them excellent production process and quality productions.98 per meter which is the lowest offered price all over the world. Various broachers are also published. 4. Free samples are delivered to customers to show how best our products are? Free sample is useful techniques in winning the loyalty of customers.

That¶s why nishat has attain a share of 40% of local fabric market . 7-PEOPLE It is very important that what people think about the organization whether they are in the organization or from the external environment. Nishat is a name of high quality. . lDistribution channal Whole sellers place the order in bulk and sell it to the small retailers.4-PLACEMENT Nishat is situated on very ideal places. Whenever you think about new variety you will suddenly get a name of nishat because nishat is providing a variety of colours for a variety of products. in external environment Nishat is the leading company with the market share of 40% and become the most famous brand in textile products. They are provided medical facilities bonuses etc. In local market nishat has set up a quality mark for other companies. Some of the products are packed according to the demand of the purchaser. For the better quality of a product nishat is using latest technology equipment so they can provide better quality. Proper packing is used for every kind of product. 6-PACKAGING Packaging of the product is also standardized. nishat is also ISO 9001-2000 certified. In nishat textile there are 32150 workers working. Such as 25 meter and 32 meter bundles of cotton and lawn cloth. Nishat fair price shops are also available for consumers so they can get there desired fabric according to there need depended upon the availability of the fabric. Company Distributor Retailer Consumer 5-POSITIONING Nishat has positioned its self on high quality at low price base. It is situated in Faisalabad and Lahore. customer purchases their needed fabric from retailer. Every product is properly sealed in to the polythene sheets so the product remain clean from outer dust till it reaches in the hands of customer.

5+ (+3. -2. -3+ Y-axis.1) =+0.5 CA average=-3 IS average=4 Directional Vector Coordinates X-axis.6 .The Space Matrix Internal Strategic Position Financial Strength (FS) Return on investment Leverage Liquidity Working Capital 3 5 4 External Strategic Position Environmental Stability Technological Changes Rate of Inflation -2 -3 Price Range of Competing Product -3 Barriers to Entry into Market -2 2 13 -10 Industry Strength (IS) Growth Potential Profit Potential Financial Stability Resources Utilization 3 5 4 4 16 Competitive Advantage (CA) Market Share Product Quality Product Lifecycle Technological Know How -1 -3 -4 -4 -12 FS average=3.1 ES average=-2.

This graph shows that Nishat mills is in third second quadrant which is a aggressive strategy quadrant. Graph shows that the company is financially strong. . Aggressive strategy In aggressive strategy the company may use one of the following strategies. Market development. Product development. Market penetration. .

As we donot know any thing about it that whats the future of Nishat Apparell is in the market. . Where as Spinning & Weaving is a cash cow for Nishat with the Highest market share. On the other hand Processing is on the STAR place with the highest Market share and Growth.BCG matrix shows that Nishat Apparell is a question mark.

Grow & Build Market Market Product Backward Forward Horizontal Integration Penetration Development Development Integration Integration Hold & Maintain Market Product Development Penetration .

6. Market Development Market Penetration Product Development Horizontal Integration Divestiture Liquidation 1. 2. 3. I 1. 4. Diversification III 1. Backward Integration 6. 3. Horizontal Diversification 3. 6. 6. 2. Conglomerate Diversification 4.Harvest or Divest Retrenchment Divestiture Liquidation Grand Strategy Matrix Rapid Market Growth II 1. 5. 3. Concentric Diversification 2. 4. Forward Integration 5. Product Development 4. 5. Joint Ventures Slow Market Growth According to the GRAND STRATEGY matrix NML is doing a rapid market growth and have a strong competitive position in the market. Market Penetration 3. Retrenchment Concentric Diversification Horizontal Diversification Conglomerate Diversification Divesture Liquidation IV 1. 4. 2. 5. Market Development 2. .

Salaries and other benefits This year NML paid for salary and other benefits is Rs 32million.Objectives Financial objectives Companies financial ojective is to attain the annual turn over of RS 29 billion in 2010 where as in 2009 it was RS 16 billion. Legal and professional charges NML paid Rs 4. Suppliers Suppliers of the company in local market is Cotton development and research institutes. Maintenance NML is properly maintaining its mavhinery and equipments. In foreign market NML is purchasing maximum from ZHANGJIAGANG NEW TIANHAI IMP & EXP CO. NML upgrades its equipment according to the need this year it spent Rs130 million approx Management cost. Value chain analysis. y Attaining bigger international market share. ENERGY suppliers Energy suppliers of NML is Wapda and NML also have its own power generation plants.. local cotton producers and cotton whole sellers. y Upgrading all the technological equipments to increase production. Production costs Plant layout plant layout is important fator in production cost however NML is aware of its importance so all the plants and other units are on easy access. Strategic objectives To achieve the turn over of Rs 29 billion company should do following things y Introduction of value added products. LTD .8 million for legal and professional cunsultancy .

in a profit and loss account. in a budgetary control system or in any other part of accounting organization.FINANCIAL ANALYSIS OF THE COMPANY 1. Accounting ratios thus shows the relationship between accounting data. RATIO ANALYSIS A) LIQUIDITY RATIO B) TURNOVER RATIO C) PROFITABILITY RATIO D) LEVERAGE RATIO RATIO ANALYSIS The term "accounting ratios" is used to describe significant relationship between figures shown on a balance sheet. Advantages of Ratios Analysis Helps in planning: Facilitates inter-firm comparison: Simplifies financial statements: Makes inter-firm comparison possible: Help in investment decisions: .

Sapphire also shows mixed trend in current ratio. Nishat current ratio has decreasing trend in 2008 and 2009.99 Azgard 9 1. current ratio year 2008 Nishat 1. It is calculated by dividing the total of the current assets by total of the current liabilities. Azgard Nine current ratio shows mixed trend and it has grater than 1:1 but only in 2008 it is higher than other years. This ratio is also known as "working capital ratio".Current Ratio: Current ratio may be defined as the relationship between current assets and current liabilities. the Azgard Nine has current ratio below standard.08 0.19 current assets/current liabilities 2009 0. The best standard ratio is 2:1 so.87 Sapphire 1. It is a measure of general liquidity and is most widely used to make the analysis for short term financial position or liquidity of a firm. . Current ratio shows that how many times current assets are available to meet its current liabilities.17 Comments: Current Ratio clears the extent to which the claim of short term creditors can be met by assets that are to become cash within a year.28 1.

such as inventory or accounts receivable. Azgard Nine decreasing the utilization of its fixed assets but it has lower times than Sapphire which has more utilization of fixed assets and at highest level in 2008. Nishat shows the decreasing trend in year 2009 . for the most part. . greater is the intensive utilization of fixed assets.60 Sapphire 2.can be used to evaluate the benefits produced by specific assets.which are. Nishat has less utilization than Sapphire and high utilization then Azgard Nine in 2009. turnover ratios -.53 2009 0. Higher the ratio.19 1. Formula = year sales / Fixed Assets 2008 Nishat 1. Activity ratios -.86 0. Lower ratio means under-utilization of fixed assets.66 Azgard 9 0.9 Comments: It shows the utilization of fixed assets. Or they can be use to evaluate the benefits produced by all a company's assets collectively.Turnover/ Activity ratios: Activity ratios are measures of how well assets are used. This ratio measures the efficiency and profit earning capacity of the concern. Fixed Assets Turnover Ratio: Fixed assets turnover ratio is also known as sales to fixed assets ratio.

The total assets turnover ratio measures the use of all assets in terms of sales. .79 0. On the other hand Sapphire has also decreasing trend but it is better than naishat and Azgard nine. This interactive tutorial walks you through the calculations as well as where on the financial statements to find the numbers.37 0.66 Comments: According to 2008 and 2009 comparison the utilization of total assets by nishat is in decreasing trend but better than Azgard nine. by comparing sales with net total assets.Total Assets Turnover Ratio. Formula year Sales/ Total Assets 2008 Nishat 0.23 Azgard 9 0.18 Sapphire 0.51 2009 0.But Azgard Nine overall situation regarding to total asset turnover ratio is bad than other two competitor.

57 13. The profit margin ratios we discuss here differ only by the numerator. Formula year Gross profit/Sales*100 2008 Nishat 15. It's in the numerator that we reflect and thus evaluate performance for different aspects of the business: The gross profit margin is the ratio of gross income or profit to sales.Profitability Ratios: Profitability ratios (also referred to as profit margin ratios) compare components of income with sales. They give us an idea of what makes up a company's income and are usually expressed as a portion of each dollar of sales. This ratio indicates how much of every dollar of sales is left after costs of goods sold.59 Azgard 9 34.02 Comments: Gross profit of nishat company increasing in 2008 ± 2009. And the competitors of Nishat company has also increasing trend in 2008 ± 2009. .15 35. Gross Profit (GP) Ratio: Gross profit ratio (GP ratio) is the ratio of gross profit to net sales expressed as a percentage. It expresses the relationship between gross profit and sales.41 2009 17.28 Sapphire 11.

Formula Operating Profit Margin = Operating profit /Sale*100 year 2008 Nishat 37. This is closely related to the ratio of operating profit to net sales. It measures the cost of operations per dollar of sales.91 2009 10.18 17. It is generally expressed in percentage.20 Azgard 9 28. .Operating profit of all three organization show decreasing trend due to increase in operating expenses.Operating Profit Ratio: Operating ratio is the ratio of cost of goods sold plus operating expenses to net sales.60 Comments: Nishat company operating profit decreased in 2008 ± 2009.72 Sapphire 14.42 11.

Net Profit/ (Loss) after Tax: Net profit ratio is the ratio of net profit (after taxes) to net sales. The ratio has decreased as compare to previous year due to increase in cost and expansion of project. Sapphire shows the decreasing trend in 2009 Nishat top net profit is in year 2008 and 2009.20 9.37 4. .49 Nishat Azgard 9 Sapphire 33.89 7.88 6. In year 2009 company suffered a minimum net profit.88 Comments: The Net Profit margin tells us the ability of a company to generate the earning after meeting all costs of business.. It is expressed as percentage Formula year Net profit before tax/Sales*100 2008 2009 9.

It is also known as external internal equity ratio.94 0.54 0. Formula year Total Long Term Debts / Shareholders Funds 2008 2009 0. It shows that Azgard nine position in debt to equity is better then its competitors. .91 0. Sapphire debt to equity ratio is lowest point in 2009 and after that it has decrease its situation in next coming years and increases the ratio.2009 which shows that they decreasing there debts for expansion of project and their short and long term debts decreased.21 Nishat Azgard 9 Sapphire 0. It is determined to ascertain soundness of the long term financial policies of the company.04 0.09 Comments: Nishat shows increasing trend from 2008 .DEBT TO EQUITY RATIO: Debt-to-Equity ratio indicates the relationship between the external equities or outsiders funds and the internal equities or shareholders funds.

76 1.EARNINGS PER SHARE (EPS) RATIO: Earnings per share ratio (EPS Ratio) are a small variation of return on equity capital ratio and are calculated by dividing the net profit after taxes less preference dividend by the total number of equity shares. which mean there is no earning and it going down. Sapphire and Nishat has also same trends but Nishat has better earning per share ratio as compare it to Sapphire and Azgard Nine. Formula year Nishat Azgard 9 Sapphire Profit after tax/No.2 4. of shares 2008 38.36 Comments: The earning per share of three companies.42 2.65 30. It is at highest point in 2008. earning per share of Nishat company decrease in 2009 as compare it to 2008 and it is at highest point in 2008 and than it decrease in 2009.8 2009 5. The earning per share has decreasd as compared to the previous year. These companies should better mange its financial position and improve its performance to get out this fall in earning per share .

103.000 15785094000 15785094000 93% 0% 93% 1.000 2.857.000 118906000 13900567000 8.141.122.025.000 9.000 23.549.518.988.227.047.597.147.000 4.310.000 25118271000 27.000 201.8000 0.916.794.000 1.721.000 11.605.000 60880191000 38% ASSETS NON-CURRENT ASSETS Property. Plant and Equipment Investment properties Long term investment Loan term loans-secured and deposits Loan term loans-secured and deposits 2008 2009 10.827.000 846126000 8333721000 2139304000 42% 51% 38% .000 1.647.309.000 10665973000 27609911000 135700000 17530901000 16006000 15753000 45308271000 61% 12% 21% 49% 33% 76% CURRENT ASSETS stores. spares parts and loose tools stock in trade Trade Debts 490.NISHAT COMPANY LIMITED BALANCE SHEET 2008 EQUITY AND LIABILITIES 2009 2009 CAPITAL AND RESERVES Share Capital Reserves Accumulated profit Total Equity SHAREHOLDERS EQUITY NON CURRENT LIABILITIES Loan term finances liabilities against assets subject to finance lease 1.541.543.323.794.000 276.000 10.180.579.229.047.424.175.648.000 25.027.329.847.000 926.87% 34% 6% CURRENT LIABILITIES Trade and other payables Interest/ mark up on loans short term borrowings Current portion of long term liabilities Provision for income tax 1.000 CONTIGENCY AND COMMETMENTS 1790890000 751195000 11407809000 1543888000 187019000 15680801000 36% 73% 20% 40% -48% 25% TOTAL EQUITY AND LIABILITIES 37.

752.000 1764610000 355608000 91194000 636499000 1404858000 15571920000 -75% -12% 67% 42% 95% 11% TOTAL ASSETS 37.013.929.154.400.432.579.295.000 73.916.267.000 60880191000 38% NISHAT COMPANY LIMITED PROFIT AND LOSS 2008 SALES COST OF SALES GROSS PROFIT DISTRIBUTION COST ADMINISTRATIVE EXPENSES OTHER OPERATING 12484139000 (9696803000) 2787336000 (680479000) (221675000) (181664000) (1083818000) OPERATING PROFIT FINANCE COST share of profit in associated companies 2021579000 (760583000) (47675000) (907.Short term investments loans and advances Short term deposit and prepayments others receivables Cash and bank balances 7.000 403.000) 1431037000 (137457000) 1293580000 2009 12% 17% -11% 9% 19% -24% 5% -40% -38% 91% -11% 15% 7% 18% .000 370.000) PROFIT BEFORE TAXATION TAXATION PROFIT AFTER TAXATION 1213321000 (147432000) 1065889000 - 2009 14152293000 (11662819000) 2489474000 (743763000) (272488000) (127685000) (1143936000) 1441951000 (550790000) ( 539876000) (819.129.000 13.000 30.518.

y Employees are not paid for the over time. y All the decisions are taken by higher management.Laps of Nishat Textile y Transport facility is only provided to the female workers y Medical facilities are only provided to the worker in the factory not to the management. y NML don¶t have proper chain of stores for their product. Fair price shops are available but outdated stocks are sold there. . y Bonuses are provided to the workers working in the factory not to the management. y Training courses are held for the upper management not for the factory employees.

yEmployees should be paid extra for the work which they done after working hours. This will create the easiness for workers and reduce the wastage of time. ySpecial incentives should also be given to Head on Eid and on other special days should be given to the workers. y NML should spent for the R&D so they can produce better demanded product.Recommendations yAt present facility of bonus is given only to production staff but such incentives should also be given to Head office Staff. yThere is also a problem of work overload for the employees and it should be control properly so that the employees are motivated. All of the management should be given a chance so that employees are motivated and innovative environment is created. y All decision should not be taken by higher management. yMedical facilities are given in mill but such facilities should also be given to management. . yDifferent training courses should be arranged for the up lifting and improvement the quality of work for employees yThey provide transportation facility to only female employees I think male should also be provided with conveyance convenience.

GROUP MEMBERS Yasir Nadeem Amanullah Khubaib Ayub Mahmood Hussain Cheema Salman Tarrar MBA-01091-074 MBA-01091-063 MBA-01091-071 MBA-01091-070 MBA-01091050 .

` TOPIC: NISHAT TEXITLE PRESENTED TO: Sir.Usman MBA 3th SEMESTER Lahore Business School .