CHAPTER- 1

INTRODUCTION - INDUSTRY PROFILE

An Overview of INDIAN PUMP INDUSTRY

Pumps play a dominant role in the sectors like agriculture, production of oil and natural gas,
petroleum refining, petrochemicals, power generation, domestic and household utilities, etc.,
and contribute a major part in nation’s economy.

Pump is not a new concept in the Indian industry. In fact, the Pichkari which Lord Krishna and
his playmates used for splashing color water on Gopi’s, can be termed as the oldest reference
to a pump concept, especially of the reciprocating plunger type. Thus, pumps must be an Indian
invention, but commercial production of pumps in India, as contemporarily understood, is
quoted to be way back in the first decade of twentieth century.

Manufacturing Scenario
Presently, the gross value of pump’s production in India is estimated to be in the order of US$
450 million (approx. 1.2 million No). The scales of production and corporate structures of
manufacturers range from the small scale industries, medium to large scale industries, both in
the unorganized sectors and also public sector units.
In terms of drive ratings, the range of manufacture extends from fractional horsepower designs
to large pumps of drive rating of the order of three MW. Almost all types of pumps,
manufactured internationally, are also made in India.

Demand and Supply Situation

Indian pumps have contributed to the nation’s economy significantly. Prominent sectors
amongst them are agriculture, onshore and offshore production of oil and natural gas,
petroleum refining, petrochemicals, mining, ship-building and marine duties, power
generation, public water supply and sanitation, domestic and household utilities, process
industries producing fertilizers, insecticides, pesticides, drugs and pharmaceuticals, textiles,
soaps and detergents, cosmetic and health care products, dairies, vegetable oil and processed
and packed food products, breweries, paints, etc.

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Indian pump manufacturers seem to fulfill all the demands of pump-usage, since imports are
not very significant. Some special construction pumps of special materials used for special
duties like requirements of very fine vacuum are also imported. The quantities are small
although the unit cost of these pumps may be high.

Globalization of Indian economy increased enthusiasm of some importers to sporadically

import a few container-loads of run-of-the mill type pumps for agriculture and domestic duties.
However, those events do not seem to have caught any fancy in the Indian markets.
Pump automatically gets imported with systems, not de-packaged for items that can be
procured indigenously. Yet, Users do seek import substitutes due to the cost-effectiveness of
Indian manufacture and for better guarantee of support with respect to after-sales service.

Technologies, Collaborations and Indigenous R&D

Most of the world-renowned technologies have been operative in India. Majority of them seem
to be European, to name a few, KSB, Seltzer, Weir, SPP, Allweiler, Bornemann, Alsthom,
Stork, Terromecanica, Godiva, Pleuger, Grundfos, ABS, Flight, Denver Orion, etc. Amongst
them American, Japanese and Australian technologies can be sighted in Worthington-Dresser,
Ingersoll Rand, Gould’s, Durco, Ebara, Asia LMI, Warman, etc. Indian technical skills and
engineering aptitudes have shown good capabilities of almost immediate absorption of the
involved design, manufacturing and quality control specifications and application engineering
needs. That gives a good picture of the internationally competitive field already in play in India.

The Indian craftsman often enterprises in reverse engineering at very competitive costs.
Amongst the notable achievements of indigenous development and R&D can be cited, the
primary coolant pumps and sodium coolant pumps for nuclear power, large 2250 mm delivery-
size vertical turbine pumps and concrete volume pumps for cooling water circulation in thermal
power generation can also be cited.
Cavitation’s studies and CFD (Computational Fluid Dynamics) analysis of flow patterns at
pump suction and deriving improvements in pump and sump designs are all becoming common
practice.

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Marching on the growth path
India has been a traditional producer of pumps with a seven decade history. However, it is only
with the recent globalization that the country is marking and increasing its presence in the
world pump market.
While major global economies are still feeling the effects of the 2009 recession, signs of
strength are occurring in the Indian economy. Investor confidence has largely been restored,
and investments that had been suspended due to the slowdown in demand are beginning to pick
up pace.

Water has become a crucial commodity in many regions, India not excluded. Emphases on
water quality, coupled with stringent wastewater discharge regulations, are creating
opportunities for the water and wastewater space to see the potential for significant growth.
This creates an opportunistic scenario for pumps suppliers.

Reasons for pump market growth

India has been a traditional producer of pumps with a seven decade history. However, it is only
with the recent globalization that the country is marking and increasing its presence in the
world pump market. India produces more than two million pump units per year, with about
95% of demand accounted for by domestic manufacturers and imports making up the remaining
percentage.
The water and wastewater sector is one of the top three end-user markets for pumps in India
and is expected to be a strong area of demand for pump manufacturers through the next decade.

Several key factors are driving opportunity and growth in the Indian water and
wastewater industry, as well as the pump industry as a whole:

Maintaining and enhancing water quality: Increased regulations, efficient legislation and
pragmatic guidelines are expected to be areas of focus. This is important if environmental
degradation is to be eventually controlled and reversed. Compliance will become an important
measure for the industry.

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Infrastructure expansion: India’s gross domestic product (GDP) growth has hovered at about
8%, and infrastructure-related development investments in the 11th Five Year Plan are planned
in the multiple billions.

Challenges in water management, created by several factors:

 India’s growing economy, increasing middle class, expanding infrastructure and

vast agricultural region are contributing to water challenges. India is the world’s
largest user of groundwater, using about 230 cubic kilometers every year (more
than one quarter of the global total). With the prevalent drought conditions in
many arid states due to inadequate rainfall, groundwater levels have been
depleting at a rapid pace. This is expected to increase demand for pressure
booster and deep well submersible pumps to draw water from greater depths.

 Urbanization of the country has led to the migration of more than one billion
people from villages to major cities, creating pressure on the existing
infrastructure, including the delivery of utility water after removal and treatment
of wastewater.
 Rising consumption and decreasing supply of uncontaminated water is driving
the growth of desalination plants in this country, also a boon for pumps India’s
emergence as a low-cost manufacturing hub India has a dual advantage of low-
cost labour and highly technical, skilled manpower. This is an enticing
proposition to the western multinational pump manufacturers that can set up
manufacturing facilities and reduce production costs by substantial levels. This
scenario facilitates not only addressing the increasing domestic demand but also
in exporting pumps to neighboring regions, including the Asian growth engine
countries. Growing real estate/housing sector growth in this specific portion of
infrastructure is expected to increase demand for energy efficient water pumps,
offering both cost savings and reduction of carbon footprint.

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Market challenges
While this market holds great promise for increasing pump revenues in the water and
wastewater space, many factors challenge sustained market growth. One is the continued
potential for political instability, which can have significant negative effects on projects funded
by the government. A change in government tends to delay or abolish planned projects,
particularly in the water and wastewater sector. A further issue is the inconsistency in the
implementation of environmental standards at the state level. This is a major restraint on market
growth in the most states don’t have systems in place to monitor water pollution levels
sufficiently, systematically and consistently. Moreover, environmental agencies have not been
granted firm support or influential legislative mandates, limiting their capacity to be effective.
A lack of conscious efforts for the enforcement of environmental legislation can affect the
growth in the pumps market.

Projected growth
According to a market research report titled India Pumps Market Outlook to 2019 - Driven by
Government Investments and Technological Advancements by Ken Research

Ken Research announced its latest publication on “India Pumps Market Outlook to 2019
Driven by Government Investments and Technological Advancements” which provides a
comprehensive analysis of various aspects such as market size and market segmentation of the
pumps market by industrial pumps and agricultural and domestic pumps. The publication
discusses major drivers and growth restraints accountable for change in the demand. Trade of
pumps has also been highlighted along with industry recent developments. The report also
covers the revenues and market shares of major pump manufacturers in India. The report is
useful for pump manufacturers, suppliers, distributors and new players venturing in the market.

The pumps market in India has witnessed declining growth rates in recent years on account of
rising cost of production, dearth in domestic demand and lack of government investments in
end user industries. The plummeting growth is majorly originated from diminishing revenue
of the India industrial pumps market. The drop in revenue generated in this segment has been
largely caused by soaring raw material prices. The pumps market in India is comprised of large
companies such as Kirloskar Brothers Ltd, KSB Pumps, and Shakti Pumps along with a huge

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unorganized sector comprising of small and medium enterprises. The India pumps market
revenues have grown at a CAGR of 14.0% from 2010-2014.

On the basis of type, pumps can be segmented into centrifugal pumps and positive displacement
pumps. In FY’2014, centrifugal pumps account for ~% of the sales of pumps in India since
they have higher utility as compared to positive displacement pumps. On the basis of end use,
pumps could be segregated into industrial pumps and agricultural and domestic pumps. The
industrial pumps segment is primarily utilized in end use segments including oil & gas, power
generation, metals & mining, water and waste water and chemicals & others. On the other hand,
agricultural and domestic pumps are usually utilized in agriculture and building services. In
FY’2014, the Industrial Pumps segment contributed ~% in the total revenue generated by the
market as industrial pumps are in more demand as compared to agricultural and domestic
pumps combined together.
“The investment announced by the Indian government for the development of infrastructure
will result in increased spending on industrial and agricultural pumps, rising pressure on profit
margins due to high raw material costs will affect the growth of this industry in the future”,
according to the Research Associate, Ken Research.

According to the research report, the India pumps market will grow at a considerable CAGR
rate thus exceeding INR 190.2 billion by 2019 driven by many industrial and macro economy
factors.

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 CHAPTER -2
ORGANISATIONAL PROFILE

BACKGROUND OF ORGANISATION

Name of the company - PVC Pumps Private Limited

Year of Incorporation
Board of directors
Legal Status
- 2001
- Mr. T.M Chandrakhanth
Mr. Rajendraprasad
Smt. Latha
Smt. Sumithra
Smt. Parvathamma
- Private Limited Company
Unit under reference - Plot no. 1c, KIADB Industial area,
Lokikere road, Davanagere, Karnataka.

PVC Pumps private ltd is leading manufacturer and of Submersible pumps, PVC PUMPS.
PVC Pumps Private Limited is a Private Company incorporated on 28 December 2001. It is
classified as Indian Non-Government Company and is registered at Registrar of Companies,
Bangalore. Its authorized share capital is ₹100,000 and its paid up capital is ₹100,000.

NATURE OF BUSINESS CARRIED

PVC Pumps Private ltd is a Manufacture of Submersible pumps:

 Submersible pumps

The product ranges are as below:

 100 mm single phase pumps
 100mm 3 phase submersible pumps
 150mm 3 phase submersible pumps

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  Open well 3 phase submersible pumps
 Open well 1 phase submersible pumps
 Self-Fleming pumps

The material of pumps shall conform to the grades as per IS 8034 and 9283 are any other
standard as per customer requirements. The pumps capacity for 0.5HP to 20HP and installed
capacity is 500 pumps per month.
The list is exhaustive however PVC PUMPS will make anything and everything clients look
for in precision Submersible pumps. It includes purchase of raw materials and conversion of
raw material into finished goods and selling of finished goods into their clients.

PVC PUMPS purchase raw material from:

 High-Tech Industries Jaipur
 Kaveri Engineering Co
 Minol Enterprises
 Ganesh Engineering Works (Ahmadabad)
 CVC Trading Co (Bangalore).

VISION, MISSION AND QUALITY POLICY

Vision:
“To be the most successful submersible pump manufacturer/ supplier in Karnataka”

Mission:
“To manufacture and supply quality submersible pumps at right time to satisfy continuous”.

Quality Policy:
 ‟ To manufacture and supply quality submersible pumps as per Is-standards at right
time to satisfy customer requirements through continuous improvements”.
 The quality policy was declared by managing director in a meeting of all employees
called by him on 25.03.2001.

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  He explained the meaning of quality policy & intention of management in terms of
organizational commitment.
 He explained the roles of each and every individual towards achievement of quality
policy through quality objectives.
 The quality policy boards written in both English & Kannada are displayed in the
organization at prominent places.
 The deployment of quality policy among the staff is done through ground discussions.
Deployment of the quality policy among the workman is done through group discussion
by respective HOD.
 “We at PVC pumps private ltd are committed towards achieving total customer
satisfaction by providing quality product at right time, through team work at all levels
of our organization”
 PVC pumps have been giving a better quality product to their clients from many years.
Since they are producing better quality products, now they have already got ISO
9001:2008

Quality policy is realized throughout the organization by

 Communicating the quality policy to all the employees in a systematic manner.
 Monitor and follow-up results on a continuous basis.
 Implementing continual improvement.
 Processes throughout the organization.

Quality objectives of the organization are

 To define and document customer requirements and review effectively so as to ensure
customer satisfaction.
 To procure quality materials and services from approved sources.
 To process quality products through continues monitoring and improvements in process
and technology.
 Optimum utilization of resources to supply quality products consistently.
 To work as a team and motive each other each other to common goal.
 To shoulder social responsibility by keeping safe and hygienic environment.

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  Optimal utilization of critical machinery as well as consistently meeting the customer
delivery requirements.

PRODUCT PROFILE
PVC PUMPS manufactures a wide range of pumps components based upon the specific needs
of their clients. The various products of PVC PUMPS are as follows:
Submersible pumps

The product ranges are as below:

 100 mm single phase pumps
 100mm 3 phase submersible pumps
 150mm 3 phase submersible pumps
 Open well 3 phase submersible pumps
 Open well 1 phase submersible pumps
 Self-Fleming pumps

Area of Operation
Plot no. 1c, KIADB Industrial area, Lokkikere road, Davanagere 577005, Karnataka, India.

OWNER SHIP PATTERN

Name of the shareholder Relationship with promoters Share in capital
Mr. Prasad Promoter 60%
Mr. Vijayakumar Cousin 20%
Mr. Chandrakhanth Cousin 20%

Competitors
 Asian Pumps Pvt Ltd, Bangalore.
 Swastik Pumps, Ahmedabad.
 Akshaya Pumps Pvt Ltd, Bangalore.
 Vinayaka Industry, Hiriyur.
 Bairavi Industry, Sandur.

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INFRASTRUCTURAL FACILITIES:
All infrastructure facilities required to support the organizational processes are provided. This
includes buildings, workspace and associated utilities, process equipment, tools and supporting
services.

Area:
Unit 1: 2400 sq. ft. built up area and 50000 sq. ft. open area

Other facilities:
 It has a separate plant and modern technology for producing product.
 Rest room facilities
 Water facility
 Company provides security measures for employees

LOGISTICS SERVICE

Logistics for Pumps industry offers customers nationwide an extensive range of tailored
and sophisticated logistics services.
Logistics solutions combine flexibility, reliability, on-schedule delivery and cost optimization.
Based on our global transportation and information network, we ensure that your goods get to
their destination with the right quantity and quality at the right time – and as inexpensively as
possible. At the same time worldwide standards in logistics performance and consistent
transparency in the supply chain guarantee rapid and flexible implementation.
In contract logistics we enter into long-term partnerships and put together tailored logistics
service packages geared precisely to your requirements on the basis of our many years of
experience.

Our range of services at a glance:

 Supply chain management
 Trailer service
 Cargo pick up facility by close body trucks / containers
 Supplier coordination of incoming goods

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  Production logistics
 JIT and JIS systems
 Warehouse management
 In-house transport
 Order picking / sequencing
 Packing
 Preassembly

ORGANISATIONAL STRUCTURE AT P.V.C PUMPS

MANAGING DIRECTOR

ASST. MANAGER MANAGER

HOD - PPC HOD - HOD - QA HOD - MARKETING

PURCHASE

Chart No 1: Showing organization structure of PVC pumps

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STRUCTURE OF FUNCTIONAL AREAS AT PVC PUMPS

PRODUCTON DEPARTMENT

FINANCE DEPARTMENT

MARKETING DEPARTMENT

HUMAN RESOURCE DEPARTMENT

QUALITY DEPARTMENT & QMS

MAINTENANCE DEPARTMENT

SUBCONTRACTOR & LOCAL LOGISTICS RECEIVING

Chart No 2: Showing functional areas of PVC pumps.

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STRUCTURE OF FUNCTIONAL AREAS AT PVC PUMPS

PRODUCTON DEPARTMENT

FINANCE DEPARTMENT

MARKETING DEPARTMENT

HUMAN RESOURCE DEPARTMENT

QUALITY DEPARTMENT & QMS

MAINTENANCE DEPARTMENT

SUBCONTRACTOR & LOCAL LOGISTICS RECEIVING

Chart No 2: Showing functional areas of PVC pumps.

PRODUCTION
Production is the process by which raw material and other inputs are converted into finished
goods.

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PRODUCTION MANAGEMENT

Production management refers to application of management principles to the production

function in a factory. In other words, production management involves application of planning,
organizing, directing and controlling to the production process.
Production function can offer competitive advantages to a firm in the following areas:

 Shorter new- product-lead time.

 More inventory turns.

 Shorter manufacturing lead time

 Higher quality.

 Better customer service.

 Reduced wastages

PRODUCTION ACTIVITIES AT PVC PUMPS

PVC PUMPS comprises of advanced production unit guided by assistant production manager.
The activities of production department start from production planning

15
The responsibilities and authorities vested with production in-charge are as follows:

 Daily production planning.

 Production monitoring.

 Review of non-conforming products.

 Production as well as quality control.

 Production equipment maintenance and repair.

 Health and safety.

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  ISO Documentation.

 Attending external audits.

MANUFACTURING (PRODUCTION) PROCESS AT PVC PUMPS:

The basic step involving in manufacturing process consists of:
• Incoming Inspection
• Cutting
• Lathing
• Pressing
• Winding
• Assembling
• Fitting
• Quality Test (Performance Test)
• Painting
• Packing
• Forwarding

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MANUFACTURING PROCESS FLOW CHART AT PVC PUMPS:

RECEIVE DISPATCH
CUSTOMER
ORDER

FINAL
PURCHASE PO TO INSPECTION
SUPPLIER

PACKING
RECEIVE RAW
MATERIALS
FROM SUPPLIER
RECEDICLARATION
OF ISI

INCOMING
INSPECTION
QUALITY
TESTING &
CUTTING PERFORMANCE
CHECKING

LATHING FITTING

PRESSING WINDING ASSEMBLING

Chart No 4: Showing Manufacturing Process Flow Chart.

Customer order is received on monthly basis. Raw material and subcontract parts are received
through Invoice/DC as applicable along with the Self inspection reports or Test certificates,
where applicable.

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INCOMING INSPECTION
Preliminary inspection is done by the stores personnel for verification of the part no, grade,
quantity, and packing etc. The discrepancies on the preliminary inspection is entered in the
DC/invoice and communicated to the supplier. For hardware no inspection except for quantity
carried out. Consumable and spares are inspected against, visual defects, brand name, type code
and quantity and updated in the Bin Card. Inspections of all incoming material are taken up
against the General Inspection plan and the respective drawings or specifications. The results
of the inspection are recorded. Tools are inspected for specification and against drawings as
necessary for the purchase of the same. On occasion of material rejected at the incoming stage,
a supplier Defect notice is raised and is forwarded along with rejected parts to the supplier and
the same is followed up by the QA In charge.

LATHING

A lathe is a machine tool which turns cylindrical material, touches a cutting tool to it, and cuts
the material. The lathe is one of the machine tools most well used by machining.
The lathe is a machine tool which holds the work piece between two rigid and strong supports
called centers or in a chuck or face plate which revolves. The cutting tool is rigidly held and
supported in a tool post which is fed against the revolving work. The normal cutting operations
are performed with the cutting tool fed either parallel or at right angles to the axis of the work.
Examples of objects that can be produced on a lathe include candlestick holders, gun barrels,
cue sticks, table legs, bowls, baseball bats, musical instruments, crankshafts, and camshafts.

19
STRUCTURE OF PURCHASE DEPARTMENT AT PVC PUMPS

PURCHASE DEPARTMENT

MANAGER

ASST. MANAGER

PURCHASING OFFICERS

Chart No 5: Showing Structure of Purchase Department at PVC Pumps.

Purchase department at PVC PUMPS involves highly qualified personnel for the best purchase.
Purchase department is concerned with purchasing all the materials required in the operation
of the company. Purchase includes both cash and credit purchase
.
PVC PUMPS has developed a supplier evaluation form whose criteria should be met by the
required supplier based upon which supplier are selected i.e., approved vendor list is prepared
for those who are being selected.

Production department identifies the need for the raw materials and notice to purchase
department and finally purchase department take purchase action

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The responsibilities and authorities vested with purchase head are as follows:
 Purchasing of raw material/brought out items.

 Supplier corrective actions.

 Attending external audits.

VENDORS LISTCAST IRRON SUPPLIERS:

Ganesh Engineering Works (AHMEDABADH) BLACK PAIPS
SUPPLIERS:
 CVC Trading Co. (BANGALORE)
45 MM BASED STEEL SHAFT SUPPLIERS:
 Kaveri Engineering Co.

 Minol Enterprises.

WENDING WIRES SUPPLIERS, SUBMERSIBLE 3 CORE PLANT CABLE

 High Tech Industries. JAIPUR.

PURCHASE PROCESS AT PVC PUMPS FOR SOME RAW MATERIAL

PURCHASE INDENT

PURCHASE ORDER

MATERIAL INWARD

REJECTED QUALITY INSPECTION REJECTED

GOODS RECEIVED NOTE

Chart No 6: Showing Purchase Process At PVC Pumps.

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STRUCTURE OF STORE DEPARTMENT AT PVC PUMPS

STORE DEPARTMENT

MATERIAL HANDLER

Chart No 7: Showing Structure of Store Department at PVC Pumps.

STORE
According to Cambridge dictionary definition:
“An amount of something that is being kept for future use.”
A professionally managed Store has a process and a space within, to receive the incoming
materials (Receiving Bay), keep them for as long as they are not required for use (Custody)
and then to move them out of stores for use (Issue). Partly finished goods, finished goods,
spares and consumables stores are also kept in store. In a manufacturing firm this process forms
a cycle to maintain and run the activities of Stores.

FUNCTIONS OF STORES
 To receive raw materials, components, tools, spares, supplies, equipment and other
items and account for them.
 To meet the demands of the consuming departments by proper issues and account for
the consumption.
 To provide adequate, proper and efficient storage and preservation for all the items.
 Physical checking of all incoming materials as per the delivery challan / invoice and
proper maintenance of daily goods receipt register or records.
 Arrange for inspection of incoming materials.
 Ensure that goods inward notes (gin) are raised and distributed without delay
 Issue materials to the consuming departments against authorized requisitions and
account for the same.

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  Maintain accurate and up-to-date records of material received, issued, rejected,
disposed and quantity on hand of all the items.
 To assist in verification and provide supporting information for effective purchase
action.

 To make available a balanced flow of materials so as to economise on capital tied up in

inventory.

 Depending upon the nature of business (i.e. manufacturing, trading services etc.) one
or more of these functions may gain primacy over the rest.

VARIOUS TECHNIQUES OF INVENTORY CONTROL USED BY

STORE HEAD
 FIFO
 LIFO
 TWO BIN SYSTEM

STORE DEPARTMENT AT PVC PUMPS

At PVC PUMPS all the material purchase are systematically stored by assigning certain
numerical codes to particular materials so that the required components/materials can
be easily located at the time of requirement. Store department works in cordial
relationship with purchase and production department

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INVENTORY CONTROL TECHNIQUES USED AT PVC PUMPS
 FIFO (First in First Out)
 LIFO (Last in First Out)

The responsibilities and authorities vested with store head are as follows:

 Receipt & issue of accepted materials.

 Bin card maintenance.
 Maintaining of minimum stock.
 Monthly stock statement preparation.
 Shelf life items monitoring and control.
 Control of hazardous materials.
 ISO Documentation.
 Attending external audits.

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FINANCE DEPARTMENT

STRUCTURE OF FINANCE DEPARTMENT AT PVC PUMPS

ADMINISTRATIVE DEPARTMENT

ACCOUNTS DEPARTMENT

ASST. MANAGER ACCOUNT

ACCOUNT ASSISTANT

Chart No 8 Showing structure of Finance department at PVC pumps.

FINANCE
The study of money and how it is used. Finance considers the relationship of money to time
and risk.
Two key sources of finance are internal sources and external sources. 'Internal sources' refers
to money they can raise from within the firm. This may include profit, or perhaps better
management of existing resources. External sources mean raising money from outside the firm.
In many cases this will mean turning to the banks, but it may also be that the firm tries to issue
more shares on the stock market or perhaps sells debentures to raise money.
Finance may deal with personal or corporate issues, such as how will an individual or company
acquires the money needed to perform a certain act.

25
BUSINESS FINANCE
Business finance is a term that encompasses a wide range of activities and disciplines revolving
around the management of money and other valuable assets. Business finance programs in
universities familiarize students with accounting methodologies, investing strategies and
effective debt management. Small business owners must have a solid understanding of the
principles of finance to keep their companies profitable.

According to Professor Gloss and Baker

“Business finance is concerned with the sources of funds available to enterprises of all sizes
and the proper use of money or credit obtained from such sources”
Therefore the finance department has been the brain of the organization. That’s why it is called
as the lifeblood of the organization.

The basic functions of financial department are as follows:

 Book keeping procedures

 Monitoring the financial transaction

 Capital expenditure analysis

 Preparing final accounts

 Providing management information

 Management of wages

 Raising finance
 Analysis and interpretation of financial statement

FINANCE DEPARTMENT AT PVC PUMPS

PVC PUMPS has a well-developed finance department which is headed by managing director,
director technical and assistant manager’s account. Finance department play an important role
in the functioning and coordinating of all department of the organization.
The total turnover of the company is more than 2 crores in the last 2010 – 2011.
PVC PUMPS has a well-established finance department which is computerized using TALLY.
Mostly used source of finance at PVC PUMPS is bank finance.

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Major functions of financial department at PVC PUMPS are as follows:
 Maintaining of books of accounts

 Bills payable

 Cash and bank payments

 Raw material purchase payments

 Dispatch documents

 Central exercise and sales tax

 Inventory and store evaluation

 ISO Documentation

 Attending external audit.

MARKETING DEPARTMENT AT PVC PUMPS PVT LTD

TYPICAL STRUCTURE OF MARKETING DEPARTMENT

MARKETING

SALES RESEARCH

Chart No 9: Showing typical structure of Marketing Department.

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MARKETING

According to American Marketing Association

“Marketing is the process of planning and executing the conception, pricing, promotion and
distribution of ideas, goods and services to create exchanges that satisfy individual and
organizational objectives.

IMPORTANCE OF MARKETING

IMPORTANCE OF MARKETING

TO CONSUMERS TO SOCIETY TO THE FIRM

 They can buy  Protection against  Communication

goods globally Evil Effects of with society
 Promotes product Depression  Decision making
awareness  Employment  Developing
 Increase standard  Availability of successful
of living. various products. changes.

Chart No 10: Showing importance of marketing.

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MARKETING DEPARTMENT AT PVC PUMPS
Every organization involves marketing department. However, the degree of marketing depends
upon the nature, product of the organization. `
PVC PUMPS doesn’t have any specialized or particular product i.e., product are designed and
produced as per the needs and order of the customer. So, PVC PUMPS lacks an effective
marketing department.

Major product of PVC PUMP is:

 Submersible pump

The formulation of marketing strategies is originated towards the 4p’s of marketing are
explained below.

PRODUCT
Product is anything that can be offered to satisfy customer need.
PVC PUMPS doesn’t deals with any particular types of product. Since it fabrication based
industry it produces any variety of products as per the design and need of customers.
PVC PUMPS products are unique and high quality. It has designed its strategy keeping in view
the customer satisfaction and quality products released to the market.
The following features of the product are considered before releasing a product for sale.

 Quality

 Design

 Packing

 Brand etc.

29
PRICE
Price stands for the amount of money customers have to pay to obtain the product.
The marketing manager should determine the price in such a way that the firm is able to sale
its product successfully.
Pricing decision and policies have direct impact on the sales volumes and the profits of the
organization.
PVC PUMPS always sets reliable price for its product. Price for the product is sets by the
director of the company. Manpower time, raw material cost, transportation cost, competitor
price etc. are taken in consideration before setting the final price for the product. And PVC
PUMPS use competitive pricing strategy in order to maintain competition with other brands
and to survive in the market.

PLACE
Place mix comprises the activities that make the product available to the target customer. The
place mix calls for selecting channels and outlets through which products reach into the hands
of the customers and arranging their physical movement to different markets segments.
PVC PUMPS doesn’t involve channel such as wholesalers and retailers and even own retail
outlets. It directly used the available transportation facilities to supply the finished products.

PROMOTION
Promotion deals with informing and persuading the customers regarding the organization’s
products.
PVC PUMPS doesn’t involve any promotional activities. So personal or direct selling is the
best method for the company.

30
 STRUCTURE OF HUMAN RESOURCE DEPARTMENT AT PVC
PUMPS

HUMAN RESOURCE DEPARTMENT

PRODUCTION PURCHASE QUALITY & MAINTENANCE

QMS

SUBCONTRACTOR & LOGISTICS STORE

Chart No 11: Showing structure of human resource department at PVC pumps.

HUMAN RESOURCE MANAGEMENT

Human resource management (HRM) is the governance of an organization's employees. HRM
is sometimes referred to simply as human resources (HR).
The process of hiring and developing employees so that they become more valuable to the
organization.

According to Edwin B Flippo

“Planning, organizing, directing, controlling of procurement, development, compensation,
integration , maintenance and separation of human resources to the end that individual,
organizational and social objectives are achieved. "
Basic HR function involves recruitment, selection, training & development, motivation,
performance appraisal, compensation management, labor relation/industrial relation, employee
welfare etc.

31
HUMAN RESOURCE MANAGEMENT AT PVC PUMPS
Human resource department at PVC PUMPS is managed under the control of manager Mr.
NAGARAJ. PVC PUMPS consists of highly experienced semi-skilled staff directing the
operation in PVC PUMPS. All personnel go through regular training.
PVC PUMPS currently employed 11 employees as:
 6 permanent workers including
 5 temporary workers including

Team comprises of various individuals involved in various activities such as:

 Raw material procurement staff
 Quality checkers.
 Production specialists
 Machine operators
 Semi-skilled & unskilled labors.

RECRUITMENT
According to Edwin B Flippo
“Recruitment is the process of searching for prospective employees and stimulating then to
apply for the job.”

INTERNAL RECRUITMENT AT PVC PUMPS

PVC PUMPS mostly recruit employees externally through:
 Advertisement

 Employee’s referrals.
 Labour contractor.

INTERVIEWS
 Face-to-Face interview (Orally).
 Interview by assigning the actual task to perform to those who have gained experienced
in that field.

32
TRAINING & DEVELOPMENT PROGRAMMES AT PVC PUMPS
According to Edwin B Flippo, “training is the act of increasing the skills of an employee for
doing a particular job.”

The official and on-going educational activities within an organization designed to enhance the
fulfillment and performance of employees. Training and development programs offered by a
business might include a variety of educational techniques and programs that can be attended
on a compulsory or voluntary basis by staff.

PVC PUMPS spend adequate amount of time and money on training and development
programmes such as.
 Training is done by superiors.
 Safety training‟ is conducted once in a year

Orientation classes are conducted to make the new recruits adaptable to the organization
culture, organization environment.

EMPLOYEE WELFARE/SERVICES AT PVC PUMPS

PVC PUMPS have good HR policies for employee salary & wages, Incentive, medical care,
accident relief and insurance as mentioned below:
Salary & wages depends upon qualification, level and experience of the employees.

At PVC PUMPS
Minimum salary - Rs 6000 (Gross)
Maximum salary - Rs 17000 (Gross)

33
Bonus employees working for 1 month are eligible for bonus.
Bonus is calculated minimum 8.33%
Incentive will be almost double of salary.
Employee state insurance (ESI) scheme of INDIA is a multidimensional social security tailored
to provide socio-economic protection to worker population and their dependents covered under
the scheme.
ESI is applicable for only those whose gross salary is less than Rs.15000. premium is not
refundable. ESI premium is calculated on the gross pay (salary) as:
1.75% of gross pay------Employee side
4.75% of gross pay------Employer side
 Medical care includes ESI scheme, First aid box.

 PVC PUMPS provides cool and safe drinking water, washing and well maintained toilet
facilities within the company premises.

 Uniform is provided twice in a year.

SAFETY AND HEALTH MEASURE AT PVC PUMPS

34
PVC PUMPS is highly concerned about employee safety and health measures.

For ensuring safety and health they provide:

 Helmets

 Gloves

 Shoes

 Eye care glasses

 Jackets

 First aid
 Safety training once in a year

QUALITY DEPARTMENT AND QMS

STRUCTURE OF QUALITY DEPARTMENT AT PVC PUMPS

QUALITY DEPARTMENT

QUALITY
MANAGER

Chart No 12 Showing structure of quality department at PVC pumps.

QUALITY
Quality may be defined as sum total of features of a product which influence its ability to satisfy
given demand. Dimension of quality includes performance, features, reliability, serviceability,
appearance, customer service, safety.

35
QUALITY CONTROL
QC refers to all those function or activities that must be performed to fill the company quality
objectives. It is an approach to prevent the defects rather than detecting the defects.

QUALITY CONTROL AT PVC PUMPS

Quality policy of PVC PUMPS
“We at PVC PUMPS private Ltd are committed towards achieving total customer satisfaction
by providing quality product at right time, through team work at all levels of our organization.”
QC department of PVC PUMPS includes highly qualified and experienced work force. They
consistently monitor and verify all components at every phase of the manufacturing cycle from
inception of raw material to final inspection of Finished Goods.

The responsibilities and authorities vested with QC head are as follows

Inspection of incoming, process and finished goods

 Preparation of inspection Reports

 Attending the customer complaint

 Interact with customer on non- conformities.

 Interact with supplier on quality issue and develop action plan for improvement.

 Monitoring of customer complaints and communicating to relevant personnel in the

organization.

 Attending external audits.

MAINTENANCE DEPARTMENT
STRUCTURE OF MAINTENANCE DEPARTMENT AT PVC PUMPS

QUALITY DEPARTMENT

QUALITY MANAGER

Chart No 13: Showing structure of maintenance department at PVC pumps

36
MAINTENANCE
Maintenance is defined as the function of production management that is concerned with day-
to-day problem of keeping the physical plant in good working condition.
MAINTENANCE MANAGEMENT
Maintenance management is concerned with planning, organizing and directing the resources
in order to control the availability and performance of the industrial plants to some specified
level.
MAINTENANCE TYPE
 Break down or corrective maintenance.

 Preventive maintenance.

 Predictive maintenance.

 Routine maintenance.

 Planned maintenance

MAINTENANCE DEPARTMENT AT PVC PUMPS

Maintenance department in PVC PUMPS is concerned with maintaining the healthy condition
of the machines and equipment of the company for regular operations.
In PVC PUMPS daily, weekly, monthly maintenance activities are carried on.
Maintenance department at PVC PUMPS.
The responsibilities and authorities vested with maintenance department are as follows:
Preventive and Breakdown Maintenance of machines of machine

 Maintenance of tools.
 New installation of equipment.
 Keeping stock of spares.
 Plant protection.
 Waste disposal.
 ISO Documentation.
 Attending external audits.

37
SUB - CONTRACTOR & LOCAL LOGISTICS RECEIVING
STRUCTURE OF SUB-CONTRACTOR & LOGISTICS AT PVC
PUMPS

SUB CONTRACT & LOGISTICS RECEIVING

SUB-CONTRACT
INCHARGE

METERIAL HANDLER

Chart No 14: Showing structure of sub-contractor &local logistics at PVC pumps

SUB-CONTRACTOR
A sub-contractor is an individual or in many cases a business that signs a contract to perform
part or the entire obligation of another’s contract.

LOGISTICS
The process of planning, implementation and controlling the efficient, effective flow and
storage of goods, services and related information from point of origin to point of consumption
for the purpose of conforming to customer requirement.

SUB-CONTACTOR AT PVC PUMPS

PVC PUMPS deals with several sub-contractors in course of manufacturing the particular
product.

A product may comprise of several parts. Thus for cost effectiveness, time-saving, quality etc
PVC PUMPS enter into sub-contracts manufacturing of such components/assemblies.

38
The responsibilities and authorities vested with the In–charge of sub-contractor and local
logistics receiving are as follows
 Receipt of the inward material, verification of quantity, physical damage and
documents

 GRN preparation and offering to inspection

 Sending materials for job work and receiving materials from job work

 ISO Documentation

 Attending external audits

4 p’s of PVC pumps

1) PRODUCT
 Product is anything that can be offered to satisfy customer need.
 PVC PUMPS doesn’t deals with any particular types of product. Since it fabrication
based industry it produces any variety of products as per the design and need of
customers.
 PVC PUMPS products are unique and high quality. It has designed its strategy keeping
in view the customer satisfaction and quality products released to the market.
 The following features of the product are considered before releasing a product for sale.

 Quality
 Brand
 Packing
 Design etc.

2) PRICE
Price stands for the amount of money customers have to pay to obtain the product. The
marketing manager should determine the price in such a way that the firm is able to sale its
product successfully. Pricing decision and policies have direct impact on the sales volumes and
the profits of the organization.

39
PVC PUMPS always sets reliable price for its product. Price for the product is sets by the
director of the company. Manpower time, raw material cost, transportation cost, competitor
price etc., are taken in consideration before setting the final price for the product. And they
follow competitive pricing strategy.
3) PLACE
Place mix comprises the activities that make the product available to the target customer. The
place mix calls for selecting channels and outlets through which products reach into the hands
of the customers and arranging their physical movement to different markets segments.
PVC PUMPS Pvt. Ltd doesn’t involve channel such as wholesalers and retailers and even own
retail outlets. It directly used the available transportation facilities to supply the finished
products in the respective stores.

4) PROMOTION
Promotion deals with informing and persuading the customers regarding the organization’s
products.
PVC PUMPS doesn’t involve any promotional activities. So personal or direct selling is the
best method for the company.

SUPPLY CHAIN MANAGEMENT AT PVC PUMPS

PVC PUMPS supports its distributors / dealers by providing technical Literature,
Advertisement materials, by participating in exhibitions & agricultural fairs etc. In addition to
the above, number of schemes is run and discounts / incentives are given so as to increase the
sales turn over, profit etc.

SUPPLY CHAIN STAGES

40
Supply Chain Stages of PVC PUMPS Pvt. Ltd

The company manufactures submersible pumps for domestic & agricultural purposes. In
general the users depend on selection of products on dealers / distributors because of
knowledge, service provision, credit facilities etc. Under these circumstances distributor /
dealer link has to be the strongest in the whole chain of activities.

Disposal of old /or rejected parts

Purchases are made w.r.t quality parameters and hence if any materials are rejected, the same
are sent back to the supplier. In case any items are rejected because of in-process problems, the
same are stored until saleable lots are ready and then disposed of.

41
Product Withdrawal Procedure

In general necessity of product withdrawal does not arise in this type of business and as such
there is no specific requirement

Distributor / Retailer Training

Training is provided to distributors / dealers on how to read the product literature, how to select
a product best suited to the customers etc. The product is to be selected based on various
parameters, such as:

 Availability of water quantity.

 Depth at which the water is available.
 Variation in water level w.r.t. seasons.
 Quantity of water required.
 Availability of power connection.
 Financial capability of the customers etc.

Stock Holding Norms

The requirements of the customers vary to a great extent. The company manufacturers a great
number of varieties of pumps and it is not possible to stock all such varieties for immediate
delivery. Few models are sold in big numbers and only those models are kept in stock by the
distributors / dealers. In all other cases, they procure the required items by placing order on the
unit.

Permitted Margins
The retail prices are printed along with details of the products. Standard deductions are given
to the distributors /dealers, such as standard deduction, warranty discount, discount for advance
payment, turnover discount etc. Thus the margins are fixed. Some concessions are given by the
distributors / dealer to the customer and thus the profits are reduced to that extent.

42
FUTURE GROWTH AND PROSPECTUS

 PVC pumps private limited is 26625th best company in India which is involved in other
wholesale n.e.c, while there are 16460 companies rated inferior than PVC pumps
private ltd.
 PVC pumps private ltd is 391st best company in Karnataka which is involved in other
wholesale n.e.c, while there are 230 companies rated inferior than PVC pumps private
ltd.
 PVC pumps private ltd. Started in 2001 i.e., company is 17 years old.

43
 CHAPTER-3

MCKENSY’S 7’S FRAMEWORK

The 7-S model is better known as McKinsey 7-S model. The name McKinsey is associated
with the 7-S model this is because it is named after two persons who developed this model,
Tom Peters and Robert Waterman. They were the consultants at Mckinsey’s & co., at that time;
they published their 7-S model in their article “STRUCTURE IS NOT ORGANISATION”
(1980) and in their books “THE ART OF JAPANESE MANAGEMENT” (1981) and “IN
SEARCH OF EXCELLENCE” (1982).
The model starts on the premise that an organization is not just structure, but consists of seven
elements:

Chart No 15: Showing Mckinsey’s 7S model.

The model is most often used as an organizational analysis tool to assess and monitor changes
in the internal situation of an organization.

44
The model is based on the theory that, for an organization to perform well, these seven elements
need to be aligned and mutually reinforcing. So, the model can be used to help identify what
needs to be realigned to improve performance, or to maintain alignment (and performance)
during other types of change.
Whatever the type of change – restructuring, new processes, organizational merger, new
systems, change of leadership, and understand how the organizational elements are interrelated,
and so ensure that the wider impact of changes made in one area is taken into consideration.
 Structure
 System
 Style
 Staff
 Skills
 Strategy
 Shared Value

STRUCTURE:
P.V.C Pumps organization structure refers to the relativity more durable organizational
arrangements and relationships. It prescribes the formal relationship among various positions
and activities. Arrangements about relating relationships, how an organizational member is to
communicate with the others, what role he is to perform and what rules and procedures exists
to guide the various activities performed by members of all part of the organizations. PVC
pumps Pvt ltd follows ethics in their organization in order to maintain a healthy organization
and relationships among all the members. Managing Director empowers sub-ordinates to
report.

SYSTEMS:
Every organization has some systems or internal processes to support and implement the
strategy and run day-to-day affairs.
For example, a company may follow a particular process for recruitment. These processes are
normally strictly followed and are designed to achieve maximum effectiveness.

45
RECRUITMENT SYSTEM
INTERNAL RECRUITMENT AT PVC PUMPS

At PVC PUMPS mostly the following internal recruitment takes place:

 Employee referrals.

EXTERNAL RECRUITMENT AT PVC PUMPS

PVC PUMPS mostly recruit employees externally through:
 Labour contractor

 Besides, employees referrals too

 Advertisement

TRAINING SYSTEM
PVC PUMPS spend adequate amount of time and money on training and development
programmes such as:

 Once in a year “safety, first aid and firefighting training” are conducted.
 Orientation classes are conducted to make the new recruits adaptable to the
organization culture, organization environment.
 Training from superiors
 Operative Training.

STYLE:
P.V.C Pumps Pvt Ltd includes the Leadership style of top management and the overall
operating style of the organization. Style impacts the norms people follow and how they work
and interact with each other and with customer. The management training is totally democratic
there are no restrictions to any employee to express his opinion. PVC Pumps has got open door
policy i.e. any level of employee can meet directly to his superior or managing director without
any hesitation. This leads to the free flow of communication within the organization.

46
STAFF:
The people / human resource management- processes used to develop managers, socialization
processes, ways of shaping basic values of management cadre, ways of introducing young
recruits to the company, ways of helping to manage the careers of employees.
PVC Pumps Pvt Ltd consists of highly experienced semi-skilled staff directing the operations.
PUMPS all personnel go through regular training.
PVC PUMPS currently employed 11 employees as:
 7 permanent workers including
 4 temporary workers including.

TEMPORARY PERMANENT TOTAL

WORKERS WORKERS

TECHNICAL 4 3 7

NON- 1 3 4
TECHNICAL

TOTAL 5 6 11

Table No 1: Showing type of employees in PVC pumps.

SKILL:
Skills include the distinctive competencies that reside in the organization. These can be
distinctive competencies of people, management practices, systems and technology.

47
The employees in P.V.C pumps Pvt ltd need to have both specific as well as generic skills.
Generic skill mean problem solving skills, decision –making skills, communication skill etc.
Specific skill means time management, shop floor management, building teams, leadership,
Motivation, creativity and environment. Shop floor employees are ITI and Diploma holder
Mechanical engineer Technicians.

STRATEGY:
Strategy refers to the systematic action and allocation of resources in P.V.C pumps Pvt ltd to
achieve the companies aim. The company is procuring the good quality of raw materials from
local suppliers, which increases their quality of the finished goods to meet the customer
expectations. The integrated vision and direction of the company as well as the manner, in
which it drives, articulate, communicates and implements that vision and direction. It can also
be defined as the choice of direction and action that the company adopts to achieve its
objectives in a competitive situation.

INVENTORY CONTROL TECHNIQUES USED AT PVC PUMPS

 FIFO(First In First Out)
 LIFO(Last In First Out)

The responsibilities and authorities vested with store head are as follows:
 Receipt & issue of accepted materials

 Bin card maintenance

 Maintaining of minimum stock

 Monthly stock statement preparation

 Shelf life items monitoring and control

 Control of hazardous materials

 ISO Documentation

48
SHARED VALUES:
All members in P.V.C pumps Pvt ltd the organization share some common fundamental ideas
or guiding concepts around which the business is built. This may be to make money or to
achieve excellence in a particular field. These values and common goals keep the employees
working towards a common destination as a coherent team and are important to keep the team
spirit alive.

49
 CHAPTER -4
SWOT ANALYSIS

SWOT ANALYSIS OF THE COMPANY

SWOT Analysis is made to analyze the internal strength and weakness and external
opportunities and threats. Successful business builds on their strengths, correct their
weaknesses, and protect against internal and external threats. They also keep an eye on their
overall business environment and spot and exploit new opportunities faster than competitors.

STRENGTHS:
It is something the organization does well relative to competitors. It arises from resources and
competencies available in an organization. It creates strategic advantage.
 PVC Pumps having semi-skilled & skilled employees.

 Continuous improvement in profit.

 Company manufactures quality pumps & supplies to government.

 PVC Pumps is producing 800 pumps per month.

 Continuous supply of raw materials by suppliers helped the company to work

continuously.

 Satisfied and motivated employees & workers.

 Company has got ISO 9001- 2000 certification.

 Competent promoters having 26 years of experience in the same line of business.

 Continues increase in demand for pumps is also one of the positive things to the
company.

WEAKNESSES:
It is something the organization does poorly relative to competitors. It arises from deficiency
in resources and competencies. It creates competitive disadvantage.

50
  Lacks in financial strength.

 Lack in infrastructural facilities.

 There is no proper promotion strategy.

 Lack in proper technical machines.

 Inadequate labour supply.

OPPORTUNITIES:
It is the major favorable situation in an organization’s external environment. It provides
position of superiority in relation to competitors.
 New technologies are increasing.

 Increasing demand for pumps.

 Government has given some exemptions to the company.

 Sales are good.

 It can produce the pumps according to demand.

 Good quality pumps are manufactured and sold easily.

THREATS:
It is a major unfavorable situation in an organization’s external environment. It provides
position of inferiority in relation to competitors.

 Low quality materials supplied by the suppliers

 Strong competitors.

 Changes in technology.

 Insufficient supply of power

 Political or Environmental changes.

 Transportation problems.

51
 CHAPTER – 5

ANAYSIS OF FINACIAL STATEMENT

RATIO ANALSIS

SL.NO PARTICULARS STANDARD 2015 2016

RATIO

1 Current Ratio 2:1 1.13 1.06

2 Quick ratio 1:1 1.13 1.05

3 Debt equity ratio 0.50:1 1.30 1.92

4 Net profit ratio - 3.71 2.0

5 Gross profit ratio - 3.36 2.11

6 Operating profit - 5.38 2.87

ratio

7 Profitability ratio - 0.25 0.11

8 Fixed asset - 16.04 13.18

turnover ratio

9 WC turnover - 3.36 2.11

ratio

10 Stock turnover 1:1 161.84 135.7

ratio

11 Debtor turnover - 0.88 0.73

ratio

12 Asset turnover - 3.28 2.28

ratio

13 Debtors - 54.82 37.23

collection period
ratio

52
 1. CURRENT RATIO

It shows the relationship between current assets and current liability. The ideal ratio is
2:1 according to this for every Rs.1 of current liability, Rs.2 of current assets should be
there. But the company is having Rs. 1.06 of CA for every Rs. 1 of CL even though it
has increased, when it compare to last year. The company has to concentrate on its
liquidity position.

2) QUICK RATIO

According to Industry standards liquid ratio must be 1:1 but the company is having 1.13:1 in
2016 which is greater than the industry standards & previous year ratio is 1.05:1 which is
greater than the industry standards. Hence by seeing this we can interpret that it has been
increased compare to previous year.

3) DEBT EQUITY RATIO

It shows the relationship between debt and equity. The ideal ratio is 0.50:1. That is for
every 50 paisa of debt, RS.1 of equity should be there. The company is having RS.1.30
of debt for every RS. 1 of equity. Hence by seeing this we can interpret that it has been

53
 decreased compare to previous year. In present case, the debt-equity ratio is more than
one in both the years. So we can say that it is a lever firm. We can do more trading on
equity. It is very beneficiary to shareholder if the firm having more EBIT. When the
EBIT is more and more over a period of time, interest cost cannot be change proportion
to changes of EBIT. Interest is a fixed cost. So, if EBIT is higher in a particular period
we cannot pay the higher interest. PVC Pumps Pvt ltd. is under profit in 2016.

4) NET PROFIT RATIO

It shows the relationship between net profit and net sales. This ratio indicates the profitability
of the firm. The company is having net profit of 3.71 in 2016 which is high compare to previous
year (2015) i.e. 2.0. This shows that the company’s net profit has been increased compare to
previous year. So the company has maintained a good profitability in the firm.

5) GROSS PROFIT RATIO

The company is having gross profit margin of 3.36 in 2016 which is high compare to previous
year (2015) i.e. 2.11. This shows that the company’s gross profit has been increased compare
to previous year.

6) OPERATING PROFIT RATIO

54
 It shows the relationship between EBIT and net sales. It is computed to analyze cost of
operation in relation to sales. Operating expenses include office expenses,
administrative expenses, selling expenses and distribution expenses. The company is
having operating profit of 5.38 in 2016 which is high compare to previous year (2015)
i.e. 2.87. This shows that the company’s operating profit has been increased compare
to previous year.

7) PROPRIETARY RATIO

It shows the relationship between Share Holders Fund and Total Asset. The company is having
Proprietary of 0.25 in 2016 which is high compare to previous year (2015) i.e. 0.11. This shows
that the company’s Proprietary has been increased compare to previous year.

8) FIXED ASSETS TURNOVER RATIO

It shows the relationship between Net sales and Fixed Assets. The company’s Fixed Asset
Turnover ratio is 16.04. In 2016 which is more compare previous year (2015) i.e. 13.18. It
shows that the company increases its Fixed Asset Turnover which is good for company.

55
9) WORKING CAPITAL TURNOVER RATIO

Company’s net working capital ratio is 3.36 in 2016 & 2.11 in 2015, this clearly indicates that
the company’s working capital is more compare to previous year; hence it is good for smooth
work flow in the organization.

10) STOCK TURNOVER RATIO

It shows the relationship between Cost of Goods Sold and Average Stock. The company’s
Stock Turnover Ratio is 161.84. In 2016 which is more compare previous year (2015) i.e.
135.7. It shows that the company increases its Stock Turnover.

11) DEBTOR TURNOVER RATIO

It shows the relationship between Sales and Average Debtors it needs to be noted that debtors
should be taken before making any provision for doubtful debts... The company’s Debit
Turnover Ratio is 0.88. In 2016 which is more compare previous year (2015) i.e. 0.73. It shows
that the company increases its Debit Turnover.

56
12) ASSET TURNOVER RATIO

It shows the relationship between Net Sales and Total Asset. The company’s Asset Turnover
Ratio is 3.28. In 2016 which is more compare previous year (2015) i.e. 2.28. It shows that the
company increases its Asset Turnover.

13) DEBTORS COLLECTION PERIOD RATIO

The Company’s Debtors Collection period Ratio is 37.23. In 2016 which is less compare
previous year (2015) i.e. 54.82. It shows that the company reduces its Debtors Collection period
which is good for company.

57
 CHAPTER - 6
LEARNING EXPERIENCE

My sincere thanks to the management of PVC PUMPS PRIVATE LIMITED, DAVANGERE

for their kind permission to undertake 4 weeks ‘ORGANISATION STUDY” in their
organization. It is a very good experience what I have studied in organization.

I have learned the organization structure of the company and also all the functional departments
of the organization. I came to know the process of manufacturing pumps and also the financial
conditions of the company.

I studied many practical aspect as compared to theoretical aspects and it is also exposed me
about working of an organization, to relate the theoretical concepts learnt in the classroom to
organizational functioning, decision making crotalarias and real life application of
management.

I have got the practical orientation of the functions of the various departments of the company.
And I was able to analyze the performance of the company. I understood the application of
theoretical concepts into business decisions in the organization.

I understood the aspects of delegation of authority, responsibility, co-ordination, and team work
etc.

I have gained knowledge about all round view of the management operation.
I got the knowledge about the Analyses of the present status & future strategies of the company.

58
 BIBLIOGRAPHY

 Company annual report – 2015 – 2016

Books referred
 Human resource management “by VSP Rao Anurag Jain publisher New Delhi 2nd
edition year 2010, page No:- 123,137,143,144,189-191,340,342.

 Marketing Management “by Philips Kotler Dorling kinderlo of publishers, New Delhi
5th edition, 2012 page no :- 4,6,50,58

 Financial Management 5th Edition by M.Y KHAN & P.K JAIN page No: 6.1 to 6.37

Websites referred

https://www.zaubacorp.com/company/PVC-PUMPS-PRIVATE-
LIMITED/U51909KA2001PTC029943 - Last Accessed on 10-08-2017
http://akvopedia.org/wiki/PVC_pumps - Last Accessed on 16-09-2017
http://www.google.co.in/ McKinney 7s Model. Last Accessed on 17-09-2017
http://3Ci.in/8-company/523181-PVC-pumps-private- limited-U51909Ka2001ptc029943
Last Accessed on 19-09-2017

59