BY

SAPNA
Under the guidance of
Prof. Uma Sharma

DEPARTMENT OF MBA
THE OXFORD COLLEGE OF ENGINEERING
Bommanahalli, Hosur road, Bangalore-560068
2016-2018
 Mahindra home finance is a main non-saving money back organizations
(NBFCs) customers in the country and semi-urban territories in India It is
part of the Mahindra Group, which is one ofothe largest
businesspconglomeratestinuIndia. We also provide housing finance,
personal loans insurance broking and mutual fund distribution services.

 Mahindra home finance joined in the year 1991 and started tasks as a back
organization in 1993. Enlisted as a store taking and have since built up in
India nearness 24 states and 4 association domains through 607 workplaces
it take into account , which incorporates - retail clients, small and medium
measured ventures.
A company focuses primarily on providing financing for:
Purchase of new home
New auto
Utility vehicles
Tractors,

Cars and business vehicles.

This represented 27%, 19%, 33% and 11%
 Mahindra and Mahindra Financial Services Limited was initiated on 2n October,
1945 by the Mahindra brothers ahead with renewed gentlemen called Ghulam
Mohammad
 The company over 72 years of manufacturing experience, those aggregation is
fabricated a compact build in the marketing, distribution, engineering and
technology which is important in change as a customer –centric organisation.
 Mahindra Rural Housing Finance Limited (MRHFL), a backup of Mahindra and
Mahindra Financial Services Limited (MMFSL), has been built up to give Home
Loans basically in rustic regions and semi urban India. Accordingly it has been
registered with the National Housing Bank (NHB) as a Housing Finance
Institution (Non Public Deposit Taking / Accepting), since 2007.
 Between March 31, 2015 and March 31, 2016, we have increased our office
network by 16.91% to 325 offices and increased the number of financing
contracts we entered into with customers by 47.54% to 388154 financing
contracts.
 Group loan: 18%
 Individual loan: 21% for 5 years
 Individual loan for 7 years 21.75
 CUTTING CHARGES OF LOAN:-
 Processing charges on loan amount is fixed at 3.5%, if a customer is not able to pay
processing charges then he has to pay at 1% rate at the beginning, and remaining
2.5% will be deducted in loan amount.
 Insurance Brokerage charges- 300/-
 Document charges-500/-
 Fire charges –according to property value Sampoorna suraksha premium fire chart,
it will be provided by Mahindra home finance.
 Life insurance- who will be an earning person or key person, the charges will be
claim on age of a person and loan amount as per concern with the help of table,
provided by HDFC Bank.
 STRENGTHS
 Mahindra Finance has favourable position of brand name of Mahindra and
Mahindra Group
 It has vast resource base of Rs.5000 crores, huge dispersion channels with
braches everywhere throughout the country.
 Company has vast monetary base as its IPO ( Initial Public offer)
 WEAKNESSES.
 Mahindra fund isn't known to everybody.
 Does not make promotion of its item
OPPORTUNITIES
 It has gone into common reserve circulation which is developing according
to Indian market improvement.
 Mahindra Finance helps people in making monetary arranging which is
most beneficial in as venture is charging in India

 THREATS
 The most imperative danger for Mahindra Finance in the market is new
passage of remote non - saving money budgetary foundation
 In instance of vehicle financing organization has intense rivalry from huge
banks like SBI, ICICI, and HDFC.
 OBJECTIVES
 Understand the Free Cash Flow System
 To calculate the Current Free Cash Flow Position
 To analyse the effect of free cash flows on financial position of the
company
 NEEDS
 Effective and efficient cash planning is very useful business concern where
cash is the main basis of all business transactions.
 It helps to evaluate the current cash position
 it helps in taking loans from banks and other financial institutions
 It helps the management in taking short term financial decisions
 The method of research adapted for the study is Secondary
data analysis.
Data collection
 Primary data not used as this study is secondary data
analysis.
 Source of Secondary data is company data such as
Balance sheet, profit and loss account and Cash flow
management.
 The secondary data was analysed for the study using
 Net profit figures were calculated using the balance sheet
 Cash management ratio was calculated to analysis the cash
ratio of the company this was done using following ratios
 Current ratio
 Absolute liquid ratio
 Proprietary ratio
 Operating cash flow ratio
 Asset efficiency ratio
 Current liability coverage ratio
 Calculation of free cash flow was done using operating
activities in cash flow statement and fixed assets in the
balance sheet
 H0: There is no significant effect of free cash flows on
financial position of the company
 H1: There is significant effect of free cash flows on
financial position of the company

STATISTICAL TOOLS USED

Hypothesis was tested using
 Spearmen’s Rank co-relation
 Co-efficient of correlation
The result obtained is compared with standard value .
of the table and the decision is being stated
•Spearman’s Rank correlation
X Y rank(x) rank (y) R1 - R2 (R1-R2)2

8300.55 123864.6 5 5 0 0
Year Net profit Free cash flow
3,401.61 97396.18 3 4 -1 1
2017 8300.55 123864.6

4417.34 62729.18 4 3 1
97396.18 1
2016 3,401.61

2,707.85 31864.792015 2 4417.34

2 62729.18
0 0

9931.92 2014 1 31864.79

2031.78 1
2,707.85 0 0
2013 2031.78 9931.92
Total 2
 ƍxy = 1- (6Ʃ (R1- R2) ²)
 N (n²-1)
 1- (6×2)
 5(5²-1)
 1- 12
 45
 = 1-0.2667
 ƍxy = 0.733
 COEFFICIENT OF CO-RELATION:
X Y XY X2 Y2

8300.55 123864.6 1028144306 68899130.3 15342439133

3401.61 97396.18 331303819.8 11570950.59 9486015879

4417.34 62729.18 277096116 19512892.68 3934950023

2707.85 31864.79 86285071.6 7332451.623 1015364842

2031.78 9931.92 20179476.42 4128129.968 98643034.89

20859.13 325786.67 1743008789 111443555.2 29877412912

 N.∑XY - ∑X.∑Y
√N.∑X2 - (∑X)2.√N.∑Y2- (∑Y)2

√N.∑X2
122114471.4 11050.54168
(∑X)2
√N.∑Y2
43250110210 207966.6084
(∑Y)2

= 1919417445

= 229814367
= 0.835203415
 The past five years current ratio indicates highest ratio at (1.23) and least
ratio is (0.63) But Current ratio is acceptable as 2:1 and from 2013 to 2015
current assets are in increasing order, from2015 to 2017 current liabilities
are in decreasing order.
 Absolute liquid ratio is measured as 1:1 to prevent the relationship of past
five years; the ratio currently stands at a high of (0.54) least is ( 0.008).
ratio is in decreasing order from 2013 to 2017.
 Proprietary Ratio is an proportion of 2:1 assets of the company, currently
the ratio is at a high of (0.96) least is (0.048) share holders fund is in
increasing order
 The operating cash flow ratio has declined drastically as considering at 0.50
for five years
 Asset efficiency ratio considered as the highest is (0.23) least is ( 0.12).
 Current liability coverage ratio has maintained standard position in the
market the highest value is (0.95) and the least is (0.36) in current year
 SUGGESTIONS
 The current ratio of the organization is below the normal level of 2:1 for the
past five years which is not good to the Organization so they have to
concentre on company assets

 The absolute liquid ratio of the organization is below 1:1 for the past five
years which is not good sign for the organizations current liquidity.

 Standard level of equity ratio is 2:1 it has maintained the level

 Operating cash flow has to maintained as cash reserve and cash equitant

 Asset efficiency ratio’s standard level is1:1 is not maintained perfectly

 Current liability coverage ratio has decreased in the current year so the
position of the company is good in market situation
 The significant of free cash flows and financial position is good sign for the
company.

 A financial position is proved by using the spearmen's rank correlation is

ƍxy = 0.733 as good to the organization position

 Profit and financial position is determined by using co- efficient of

correlation as r = 0.8352

 For the calculation of free cash flow we required depreciation or

amortisation and capital expenditure to measure the experience of FCF to
the growth and efficiency of cash
The Study on, ‘ EFFECT OF FREE CASH FLOW ON PROFITABLITY
FIRMS’, Has considered the various secondary documents and has assigned at
the inference as discussed this using's out of these
 The net profit of the organization is not in the satisfactory level , where it
has to be increased. The organization should exercise proper control over all
about expenditures and profits
 The organization has to maintain standard level of current ratio.
 It is necessary to know the efficiency of employees in the organization
 It has to know about economic condition in the market
 They can expand the business in broad manner
 The business in concern to only rural areas they should spread over it urban
areas also
 MAHINDRA HOME FINANCE has to review its loan policy to construct
the more profits to the company .
 This has to improve its liquidity position in all the five years
 A finance has to increase the margin of operating cash flows and net profits
of the organization
 To satisfy their customers and for good dealings MAHINDRA HOME
FINANCE has to make prompt disbursement of loan amount to the
customers.
 A company has to guide a loan procedure and disbursement process,
approval, loan sanction such services has to explain to the customers as well
as illiterate people
 It was a great experience to undergo the Internship training in private sector. I learned a
lot about the banking industry. Not only did I get experience in the real work force, but I
also gained many new skills.
I gained many new management skills and also got a chance to learn new things like
loan procedures, on my own experience.
I would like to thank the Company HR Anand Arun for giving me this opportunity at
MAHINDRA HOME FINANCE and also would like to sincerely thank the internal
guide Mr. SOJAN V TARKEY For guiding and helping me to understand the
workforce in the company.
MAHINDRA HOME FINANCE gives high value for time, facilities, material and
human resources, as member of a team, teaching new skills, service to public
participation and working with diversity.
One of the highlights of the summer program was having the chance to learn about the
other departments as there are many departments that have global operations. Everyone
in MAHINDRA HOME FINANCE was extremely friendly and willing to spend their
services with me to give a different perspective of the MAHINDRA HOME FINANCE