PREFACE

Preparing a project of this nature is an arduous task and I was fortunate enough to get support from a large number o persons. I wish to express my deep sense of gratitude to all those who generously helped in successful completion of this report by sharing their invaluable time and knowledge. It is my proud and previledge to express my deep regards to Respected HOD Dr.Pramesh Gautam, Head of Department of Business Management , SVNU, SAGAR for allowing me to undertake this project. I feel extremely exhilarated to have completed this project under the able and inspiring guidance of Mr. Neha Dubey she rendered me all possible help me guidance while reviewing the manuscript in finalising the report. I also extend my deep regards to my teachers , family members , friends and all those whose encouragement has infused courage in me to complete to work successfully.
SHISHIR JAIN MBA 1 ST SEM..

ACKNOWLEDGEMENT

Preparing a project of this nature is an arduous task and I was fortunate enough to get support from a large number o persons. I wish to express my deep sense of gratitude to all those who generously helped in successful completion of this report by sharing their invaluable time and knowledge. It is my proud and previledge to express my deep regards to Respected , Head of Department Dr.Pramesh Gautam, Department of Business Management , SVNU, SAGAR for allowing me to undertake this project. I feel extremely exhilarated to have completed this project under the able and inspiring guidance of He rendered me all possible help me guidance while reviewing the manuscript in finalising the report. I also extend my deep regards to my teachers , family members , friends and all those whose encouragement has infused courage in me to complete to work successfully.

MBA IST SEM.

DELCLARATION BY THE CANDIDATE

Date : I declare that the project report titled " MARKETING STRATEGY OF TOP FIVE BRAND OF SHIRTS" on Market Segmentation is nay own work conducted under the supervision of Miss Shweta Rajput Department of Business Management, SWAMI

VIVEKANAND INSTITUTE OF TECHNOLOGY SAGAR To the best of my

knowledge the report does not contain any work , which has been submitted for the award of any degree , anywhere.

MBA IST SEM.

CERTIFICATE
The project report titled " " MARKETING STRATEGY OF TOP
FIVE BRAND OF TELECOMMUNICATION " been prepared by ANKIT JAIN

MBA IST SEM., under the guidance and supervision of MISS SHWETA RAJPUTfor the partial fulfillment of the Degree of MBA.

Signature of the Supervisor

Signature of the Head of the Department

Signature of the Examiner

CONTENTS
PREFACE ACKNOWLEDGEMENT CERTIFICATE DECLARATION CHAPTER I INTRODUCTION ABOUT PROJECT AN INSIGHTOF COMPANY HISTORY MISSION AND VISION STANDING POSITION OF COMPANY BRAND VALUE CHAPTER II OBJECTIVE OF THE STUDY CHAPTER III RESEARCH METHODOLOGY CHAPTER IV MARKET ANALYSIS OVERVIEW BRANDS CHAPTER V CONSUMER GROUPS CONSUMER BEHAVIOUR CHAPTER VI PRODUCT PROFILE PLAN FOR PRODUCT MIX PRODUCT RANGE CHAPTER VII MARKETING STRATEGY PRICING POSITION AND DISTRIBUTION PROMOTION CHAPTER VIII ABOUT COMPETITORS COMPETITOR FOR PRODUCT PRICE OF COMPETITOR PRODUCT CHAPTER IX DATA ANALYSISAND INTERPRETATION CHAPTER X LIMITATION CHAPTER XI CONCLUSION & SUGGESTION BIBLIOGRAPHY

QUESTIONNAIRE

INTRODUCTION
All societies observe certain rules, some of them quite strict, about the way in which men, women and children should dress, or how different social classes and groups should present themselves. These norms come to define the identity of people, the way they see themselves, the way they want others to see them. They shape our notions of grace and beauty, ideas of modesty and shame. As times change and societies are transformed, these notions also alter. Modifications in clothing come to reflect these changes. The emergence of the modern world is marked by dramatic changes in clothing. In this chapter, we will look at some of the histories of clothing in the modern period, that is in the nineteenth and twentieth centuries. Why are these two centuries important? Before the age of democratic revolutions and the development of capitalist markets in eighteenth-century Europe, most people dressed according to their regional codes, and were limited by the types of clothes and the cost of materials that were available in their region. Clothing styles were also strictly regulated by class, gender or status in the social hierarchy. After the eighteenth century, the colonisation of most of the world by Europe, the spread of democratic ideals and the growth of an industrial society, completely changed the ways in which people thought about dress and its meanings. People could use styles and materials that were drawn from other cultures and locations, and western dress styles for men were adopted worldwide. In Chapter I you have seen how the French Revolution transformed many aspects of social and political life. The revolution also swept away existing dress codes, known as the sumptuary laws. Let us look briefly at what these laws were.

What were these new values? What created the pressure for change? Many changes were made possible in Britain due to the introduction of new materials and technologies. Other changes came about because of the two world wars and the new working conditions for women. Let us retrace our steps a few centuries to see what these changes were. 3.1 New Materials Before the seventeenth century, most ordinary women in Britain possessed very few clothes made of flax, linen or wool, which were difficult to clean. After 1600, trade with India brought cheap, beautiful and easy-to-maintain Indian chintzes within the reach of many Europeans who could now increase the size of their wardrobes. Then, during the Industrial Revolution, in the nineteenth century, Britain began the mass manufacture of cotton textiles which it exported to many parts of the world, including India. Cotton clothes became more accessible to a wider section of people in Europe. By the early twentieth century, artificial fibres made clothes cheaper still and easier to wash and maintain. In the late 1870s, heavy, restrictive underclothes, which had created such a storm in the pages of womens magazines, were gradually discarded. Clothes got lighter, shorter and simpler. New words Chintz Cotton cloth printed with designs and flowers. From the Hindi word chint.
Fig.9a Even for middle- and upper-class women, clothing styles changed. Skirts became shorter and frills were done away with. Fig.9 Changes in clothing in the early twentieth century. Fig.9b Women working at a British ammunition factory during the First World War. At this time thousands of women came out to work as war production created a demand for increased labour.The need for easy movement changed clothing styles.

India and the Contemporary World

166

Yet until 1914, clothes were ankle length, as they had been since the thirteenth century. By 1915, however, the hemline of the skirt rose dramatically to mid-calf. Why this sudden change? 3.2 The War Changes in womens clothing came about as a result of the two World wars. Many European women stopped wearing jewellery and luxurious clothes. As upper-class women mixed with other classes, social barriers were eroded and women began to look similar. Clothes got shorter during the First World War (1914-1918) out of practical necessity. By 1917, over 700,000 women in Britain were

employed in ammunition factories. They wore a working uniform of blouse and trousers with accessories such as scarves, which was later replaced by khaki overalls and caps. Bright colours faded from sight and only sober colours were worn as the war dragged on. Thus clothes became plainer and simpler. Skirts became shorter. Soon trousers became a vital part of Western womens clothing, giving them greater freedom of movement. Most important, women took to cutting their hair short for convenience. By the twentieth century, a plain and austere style came to reflect seriousness and professionalism. New schools for children emphasised the importance of plain dressing, and discouraged ornamentation. Gymnastics and games entered the school curriculum for women. As women took to sports, they had to wear clothes that did not hamper movement. When they went out to work they needed clothes that were comfortable and convenient. So we see that the history of clothing is linked to the larger history of society. We saw how clothing was defined by dominant cultural attitudes and ideals of beauty, and how these notions changed over time. We saw how reformers and conservatives struggled to shape these ideals, and how changes within technology and economy, and the pressures of new times made people feel the need for change.

OBJECTIVE OF THE STUDY

OBJECTIVE OF THE STUDY

To know about the different brands of Insurance. To know about the customer satisfaction To know about pricing to Insurance To know about market share of insurance To know about the customers services.

RESEARCH METHODOLOGY
According to Green and Tall A research design is the specification of the methods and procedures for acquiring the information needed. It is the overall operational pattern or framework of the project that stipulates which information is to be collected, from where it is to be collected and by what procedures

This research process based on primary data analysis and secondary data analysis will be clearly defined to meet the objectives of the study.

I chose the primary sources to get the data. A questionnaire was designed in accordance with our mentor in Ketchup. I chose a sample of about 30 corporate customers

I collected some data from the secondary sources like published Company documents, internet etc. Research Design A research design is the arrangement of conditions for collections and analysis of data in a manner that aims to combine relevance to the research purpose with economy in procedures. It is a descriptive cross sectional design .It is the conceptual structure with in which research is conducted; it constitutes the blueprint for the collection, measurement and analysis of data. It is needed because it facilitates the smooth sailing of the various research operations, thereby making research as efficient as possible yielding maximal information with minimal expenditure of effort, time and money. In the preliminary stage, my research stage constituted of exploratory study by which it is clear that the existence of the problem is obvious .So, I can directly head for the conclusive research. Sampling Plan Sampling plan is a distinct phase of research process. In this stage I have to determine who is to be sampled, how large should be the needed sample and how sampling unit is to be selected. Population

In my research, I have defined my population as a complete set of customers of Sagar City. Sample Survey As compared to census study, a sample study has been conducted by us because of: Wide range of population, it was impossible to cover the whole population Time and money constraints. Sample Unit In this survey I took the list of customers from the dealers of Ketchup Sampling Technique Sampling technique implies the method of choosing the sample items, the two methods of selecting sample are: Probability method. Non-probability method. Probability method is those in which every item of the universe has an equal chance of the inclusion in the sample. Non-probability methods are those that do not provide every item in the universe with known cause of being included in the sample. The selection process is partially subjective. For my study, I employed the Non-probability sampling technique, in which I got the data of the customers from the dealer of Ketchup.

MARKET ANALYSIS

Market Analysis

Bershka
Womens Wear Coats and Jackets Dresses Skirts T-shirts Shirts & tops jeans Mens Wear Lowest Price Coats and Jackets 50 TL Shirts 40 TL knits 50 TL jeans 50 TL T-Shirts & tops 37 TL Pants 38 TL Description Colored bands nylon jacket Checkered cotton shirt Basic V- knitted sweater Straight best price jeans Checkered shirt Terry Capri pants Lowest Price 63 TL 30 TL 22.5 TL 12 TL 30 Tl 40 TL Description Quilted nylon jacket Stretch cotton dress Vinyl skirt Shirred sleeve t-shirt oversize shirt Stretch Jean Legging

Gap
Womens Wear Coats and Jackets Dresses Skirts Lowest Price 63 TL 62 TL 34 TL Description Boucle moto jacket Tiered drawstring-waist print dress Pinstripe pencil skirt

T-shirts Shirts & tops jeans Mens Wear

18 TL 22 Tl 48 TL

Vintage burnout t-shirt Rayon turtle neck Heathered sateen jeans

Lowest Price Coats and Jackets 104 TL Shirts 61 TL knits 50 TL jeans 77 TL T-shirts & tops 30 TL Pants 68 TL

Description Four pocket nylon jacket Multi plaid shirt Basic V- knitted sweater Eclipse wash jeans Logo thermal The classic khaki

Mango & H.E

Womens Wear Jackets Coats Dresses Skirts T-shirts Shirts & tops jeans Mens Wear Lowest Price Coats and Jackets 360 TL Shirts 91 TL jeans 90 TL T-shirts & tops 30 TL Pants 108 TL Description Wool suit jacket Fine pinstripe shirt Robert jeans Printed T-shirt Dart pants Lowest Price 80 TL 178 TL 42 TL 62 TL 16 TL 20 TL 72 TL Description Cropped denim jacket Long trench coat in a shiny finish Flowery print dress flowery skirt Teardrop t-shirt Animal paint shirt Super slim jeans

ZARA
Womens Wear Jackets Coats Dresses Skirts T-shirts Shirts & tops jeans Mens Wear Coats & trench coats Jackets Shirts jeans T-shirts & tops Pants Knits Lowest Price 234 TL 126 TL 72 TL 106 TL 18 TL 90 TL 54 TL Description Short duffle coat Fleece jacket with toggles Oxford gingham shirt Wash effect jeans relaxed T-shirt 5 pocket trouser Cotton-polyamide sweater Lowest Price 170TL 162 TL 63 TL 54 TL 28 TL 63TL 72 TL Description Short puffer jacket Knitted cardigan coat Polo neck dress textured skirt Mosaic print t-shirt twill shirt Distressed skinny jeans 126 TL 162 TL 145 TL

Lamin Studio ripped

H&M
Womens Wear Coats and Jackets Dresses Skirts Sweaters Shirts & tops Lowest Price 82 TL 54TL 21 TL 30 TL 21 Tl Description Jacket in washed Denim Short, fine knit tunic Chiffon skirt Purl-kint sweater Rub-knit tank

jeans Pants Mens Wear Coats & trench coats Jackets Shirts jeans T-shirts & tops Pants

34 TL 13 TL

Denim jeans leggings

Lowest Price 324 TL 106 TL 18 TL 35 TL 18 TL 44 TL

Description Double breasted coat Crinkled leather jacket Button-down shirt with double collar Simple jeans Printed t-shirt Regular pants

CONSUMER BEHAVIOUR
Taste and Preferences Price Quality

I used to buy any clothing material based on my taste and preferences. My taste and preferences mainly depend on two factors which are price and quality. Most of the Indian consumers are price conscious so whatever the product the marketer introduced into the market, he has to keep in the mind the affordability factor. If you consider me as an example I usually preferred to buy any branded cloth whenever there is a discount or an offer. Apart from price I always see the quality of the cloth such as durability of the cloth.

COLOUR OF THE CLOTHING WEAR-PERSONALITY TRAITS Ian Robinson has made a classification of personality traits based on the clothing color he mostly wears. Blue: Self centered square minded and flexible persons and in whose presence others feel safe and comfortable Yellow: Happy persons, with positive attitude and are the ones who starts new ideas and projects. Green: Loving persons, who cares about others feelings, positive and charismatic persons, likes projects and constant personal development. Red: Emotional and also passionate, likes ideas and loves new feelings and are very secure people. Black: Sober persons, likes to be in their world and takes things with a very analytical mind. Brown: Nature caring people, their feelings are guided toward protection and making others feel secure. Pink: Sign of a good self-stem and often are people who likes to share and making others feel comfortable. Gray: Usually persons of fixed ideas and centered feelings towards him/her and for others feelings. If someone wears variety of colors is an open mind person.

PRODUCT PROFILE
PARK AVENUE
Park Avenue was launched in 1986. Providing innovative & stylish wardrobe solution to well dressed gentlemen. They are catering customer who needs formal clothing for various occasion. Not only this, in year 2008, it had also won the Most Innovate Brand in Fashion Awards at the Lycra. A range of distinct & structural formal wear, chic & contemporary day wear as well as elegant wear are some of the collection features of it.

Raymond Group
Incorporated in 1925, Raymond Group (BSE: 500330) is one of India's largest branded fabric and fashion retailers. It is one of the leading, integrated producers of worsted suiting fabric in the world, with a capacity of producing 31 million meters of wool & wool-blended fabrics. The Group owns apparel brands like Raymond, Raymond Premium Apparel, Park Avenue, Park Avenue Woman[3] ColorPlus & Parx. All the brands are retailed through The Raymond Shop (TRS) - One of the largest network of over 700 retail shops spread acrossIndia and overseas, in over 200 cities. In addition, the Group also has business interests in readymade garments, designer wear,cosmetics & toiletries, engineering files and tools, prophylactics and air charter operations.

History
Years ago[when?], when the Singhania family was building, consolidating and expanding its various businesses in Kanpur (India), one Mr. Wadia was in a similar manner setting up a small woollen mill in the area around Thane creek, 40 km away from Bombay (now Mumbai), India. The Sassoons, a well-known industrialist family of Bombay (Now Mumbai), soon acquired this mill and renamed it as The Raymond Woollen Mills. Acquisition of The Raymond Woollen Mills in the year 1925. When the grandson of Lala Juggilal, Lala Kailashpat Singhania took over Raymond in 1944, the mill primarily made cheap and coarse woollen blankets, and modest quantities of low priced woollen Fabrics. The vision and foresight of Mr. Kailashpat Singhania greatly helped in establishing the J.K. Group's presence in the western region. Under his able stewardship, Raymond embarked upon a gradual phase of technological upgradation and modernization.[citation needed]

When Dr. Vijaypat Singhania took over the reins of the company in 1980, he injected fresh vigour into Raymond, transforming it into a modern, industrial conglomerate.[citation needed] Gautam Singhania, the present Chairman and Managing Director have been instrumental in restructuring the group.[citation needed]

Group Companies
Raymond Ltd. Raymond Ltd. is among the largest integrated manufacturers of worsted fabrics in the world.[citation needed] Raymond Apparel Ltd. Raymond Apparel Ltd. has in its folio some of the apparel brands in India Raymond Premium Apparel,Park Avenue, Parx. ColorPlus Fashions Ltd. ColorPlus is among the smart casual brand in the premium category in India. Silver Spark Apparel Ltd. A garmenting facility in India that manufactures formal suits, trousers and jackets. EverBlue Apparel Ltd. A denim garmenting facility in Dodaballapur near Bangalore (India). J.K. Helene Curtis Ltd. A player in the grooming, accessories and toiletries category. JK Files (India) Limited. A player in the Engineering Files & Tools segment and the largest producer of steel files in the world.[citation needed]

ZODIAC
For the last 50 years, in fashion garments it has been a quality manufacturer and also considered as a one of the finest quality shirt makers. They are using a finest fabric for all shirts to give quality, value for money products and also at affordable prices. In year 2000, at the prestigious Images Fashion Awards it was also awarded for the most

admitted neckwear brand. Zodiac is the most popular as a fine brand in shoppers stop in India. Now zodiac shirts are also dealing in rest part of the world like Bijenkorb in Holland, across the Middle East and selected retailers in Canada & Germany and considered to be international distributors co. (Zodiac clothing ltd., 2010)

PETER ENGLAND

In year 1889 under the name of Peter England, the Modest Factory was built in Londonderry, Ireland and comes with the hall mark HONESTY IMPRESSIVE for all products to boasts the selling of the internationally styled garments and offering value for money to its customer. It was also awarded as Honest-to-goodness prices for supplying the British troops khaki uniform for the highest quality. In year 1997, Aditya Birla Group brought Peter England to India and a major milestone to embark up. It was launched as a HONEST shirt to astounding success by providing an Indian male a decent shirt who wants to look good by paying a little and now in India, it becomes the fastest selling ready made shirts brand. And also from the last few years, the brand becomes a full fledged wardrobe solution by extended its range to Trousers, Casuals & Suits. It also offering three distinct quality clothing as a name Peter England, Peter England Elements & Peter England Elite. It was one of the earliest brands offering office wear and now offering a complete range from everyday to special day and in future it also wishes to enter in new geographical area in other part of the world to create consumer experience of unique and relevant.
Peter England Menswear Brands Division

Peter England, the largest selling shirt brand in the country boasts of an impressive portfolio of internationally styled garments offering value for money to its customers, which is the hallmark of all Peter England products. More than a century ago, a modest factory was built in Londonderry, Ireland to make gentlemens attire under the name Peter England. The year was 1889. A war frenzy

was sweeping across Britain as they prepared for what came to be known as the Boer War. One challenge the army faced was the lack of war uniforms for their troops. Peter England was awarded the colossal task of supplying the British troops khaki uniforms with the highest quality at honest-to-goodness prices. The rest as they say is history. More than a century later, Peter England was all set to embark up on yet another major milestone. The year was 1997. A new India was emerging. An India of growth and opportunity. Aditya Birla Group, a US $29.2 billion Fortune 500 company brought Peter England to India. The values of an emerging country struck a fine chord with Peter England. And it well reflected in what Peter England offered. Peter England launched in India with the honest shirt to astounding success. International style coupled with great value found instant acceptance with a large segment of the Indian male population who wanted to look good at work without paying heavily for it. With this launch campaign, Peter England went on to become the fastest selling ready-made shirt brand in India. Millions of adorning middle-class Indian males not only took pride in wearing the shirt but also developed an emotional connect with the brand. Over the next few years the brand extended its range to become a full-fledged wardrobe brand with trousers, casuals and suits. A leading mens wear brand in the country, Peter England offers quality clothing to the discerning male under three distinct offerings viz. Peter England, Peter England Elements and Peter England Elite. Peter England forms an integral part in the young corporate executives wardrobe, wishing to make a positive impression at his workplace. He experiences Peter England as one of the first brands in office-wear and often has memories that last a long time. The Peter England product portfolio comprises of a wide array of shirts, trousers, suits and acessories, offering a complete range from everyday to special. Peter England Elements caters to the casual side of this smart Indian male. The merchandise offering spans from Relaxed Office-wear to Weekend Casuals. The portfolio is completed through t-shirts, jackets, denims, cargos, sweaters etc.

Thanks to the strong equity the brand enjoyed in the office wear space Peter England was well poised to stretch its offerings into this higher price segment. Peter England Elite was launched in 2007 marking the brands foray into the quasi premium segment. The future is bigger and better. With entrance in new product categories and consumer segments, a growing distribution network and a retail expansion drive, Peter England is all set to surge new heights. Peter England also wishes to enter new geographies in other parts of the world and create a consumer experience that is relevant and unique.

APPLE PLUS
Apple Plus providing wide range of products like gentle cotton shirts, long shirts, short shirts, polyester shirts, casual shirts. It also provide customers a finely stitched formal wear to enhance their personality and in varied pattern and colors. Striped cotton, plain are ranges available in formals and they have specialization in custom designing and manufacturing. They provide top class fabric & classical styles as a range. For the fashion concerned men, they having a specially fine quality skin friendly fabric and also made according to the latest fashion so that these shirts are widely demanded and not only this, they all are available in market at very affordable price to capture wide range of market.

WILLS

Wills classic work wear, Wills sport relaxed wear, Wills clublife evening wear and Wills signature designer wear for special occasion are the Wills garments coming in exclusive labels. In 2007, by Time Magazines it considered the Top luxury brands of India. And not only this, in 2nd loyalty summit & Awards, it was crowned for customer & brand loyalty in the retail sector. It was also launched an innovative designs that requisite in style & comfort to wear as per market grew and demand for high quality.

MARKETING STRATEGY
Product Offering H&M is considered as one of the worlds preferred clothing brand and designer of apparels for men and women. H&M is renowned and known not only for their fashion cosmetic, but is also because of the quality, designed durability, and funkiness of the clothes they offer. The main goal of this company is to provide unique and innovative designs of clothes and apparels for different types of people: men, women, teenagers and children, in different countries all over the world. H&M has been known because of its strategic methods of providing clothing designs exclusively for each countrys preferences and needs. The main objective of H&M are geared towards producing fashionable and affordable products such as: 1) Clothing garments

a.) basics b.) nightwear c.) underwear d.) fashionable items 2) Cosmetics 3) Accessories a) Bags b) Necklaces c) Earrings d) Headwear, etc. Positioning In order for the company its products to be made known to the market place; the products will be distributed to its consumers. The main market of H&M is the fashionable sector of the market, which still focuses on the quality and affordability of the products they choose. Venturing with distinguished distributor of apparels, cosmetics and clothes will help in the expansion of H&M internationally, thus with its expansion in the Philippines. H&M will provide what the consumers want and prefer. The products that H&M provides is directed at the interests of the consumers and what will bring them comfort and satisfaction. There is a constant goal to produce and sell products which satisfies the consumer wants demands, and needs.

Competition Current competition includes the following:

Gap - known for providing jeans, khakis, and T-shirts. The firm, which operates about 3,150 stores worldwide, built its iconic casual brand on basics for men, women, children and urban Chic.

Topshop - British clothes retailer with stores in over 20 countries and online operations in some of its markets. Topshop's sales primarily come from women's clothing and fashion accessories. It is part of the Arcadia Group.

Zara - one of the largest international fashion companies. It belongs to Inditex, one of the worlds largest distribution groups. It provides apparel for men,women and kids.

Old Navy branched by Gap, it offers products for women, men, girls, boys, babies and toddlers.

Banana

Republic

offers

elevated

essentials

and

sophisticated seasonal collections of accessories, shoes, and personal care products. From work to casual occasions to going out, Banana Republic offers covetable,

uncomplicated style.

DATA ANALYSIS AND INTERPRETATION

ANALYSIS AND INTERPRETATION OF DATA

4.1 COMMON-SIZE INCOME STATEMENT

In common-size income statement, each item is expressed as a percentage of sales, thus enabling the relationship between sales and specific revenues and expenses to be easily evaluated. Three frequently cited ratios of profitability that can be read directly from the common-size income statement are gross-profit margin, operating-profit margin, and the net-profit margin.

Al- Qadir Textile Mills Limited Common-size Income Statement For Year 1998 2002 TABLE 4. 1
2002 Net Sales Cost of Sales Gross Profit Operating Expense Operating Profit Other Income Financial Charges Workers Participation Fund Profit/Loss Before Taxation Taxation: Current- year Prior-year Profit After Tax 100% 92.93 7.07 3.22 3.85 0.19 4.04 (3.38) (0.01) 2.82 0.79 0.08 1.95 2001 100% 86.70 13.30 2.63 10.75 0.11 10.86 (4.79) (0.30) 5.77 0.50 0.01 4.21 2000 100% 78.89 21.10 4.71 16.40 0.02 16.42 (6.89) (0.48) 9.06 1.07 7.99 1999 100% 87.14 12.86 4.50 8.36 0.11 8.46 (9.30) ___-__ (0.84) 0.63 ___-__ (1.46) 1998 100% 88.89 11.12 4.49 6.62 0.10 6.72 (8.23) ___-__ (1.51) 0.23 0.74 (0.97)

Starting with the cost of sales the companys average cost of sales for five years are 86.91% for five years, moreover which has changed each year as it depends on many other factors like raw-material consumed, salaries and wages, electricity used etc. Gross-profit has gradually decreased for the first four years but for the last year it is maximum with respect to previous years. Similar is the case with operating expense; the company has reduced its operating expense, in 2001 these expenses are minimum the attractive thing to note here is companys sales are highest for this year and that is Rs. 707,050,099. Company has also concentrated its financial obligations by the end of 2002. For the year 1998 and 1999 profit before taxation is negative additionally that makes the company to bear loss and for three years reduction can be seen in the profit both before and after taxation.
Al- Qadir Textile Mills Limited Common-size Income Statement For Year 1998 2002 FIGURE 4. 1

AL-QADIR TEXTILE MILL LTD.

120 100
PERCENTAGE

Net Sales Cost of Sales Gross Profit Operating Expense Operating Profit

80 60 40 20 0 1998 1999 2000 2001 2002

YEARS

Figure 4.1 shows the common-size analysis of Al-Qadir textile mill, in which sales are shown as 100 percent and other item as a percentage of sales. When cost of goods sold is subtracted from the sales we get gross-profit. The companys cost of sales is lowest for the year 2000, which is the companys best performing year; and year 2002 as highest cost of sales leaving lowest operating profit.

D.M Textile Mills Limited Common-size Income Statement For Year 1998 2002 TABLE 4. 2
Net Sales Cost of Sales Gross Profit 2002 100% 86.60 13.4 2001 100% 85.70 14.3 2000 100% 86.40 13.6 1999 100% 92.20 7.8 1998 100% 93.13 6.87

Operating Expense Operating Profit Other Income

3.5 9.8 0.2 10.00

3.6 10.72 0.36 11.08 5.87 0.26 4.95

3.3 10.34 0.10 10.44 7.89 0.13 2.46

3.4 4.40 0.12 4.52 8.36 ___-__ (3.84)

4.7 2.17 0.16 2.33 12.13 ___-___ (9.79)

Financial Charges Loss on sale of fixed assets Workers Participation Fund Profit/Loss Before Taxation Taxation: Current- year Prior-year Deferred Profit/ Loss After Taxation

6.05 0.01 0.19 3.75

0.50 0.05 ___-__ 3.21

0.50 0.03 ___-__ 4.42

0.50 0.42 ___-__ 1.50

0.50 0.001 1.63 (2.71)

0.50 __-___ (10.29)

As it can be seen from the profit & loss account of D.M textile in the appendix section that its sales has always increased but the company has specialized to reduce its cost of sales, it shows like they are properly utilizing the economies of scale, by lowering the cost of production, which is also proved by the gross profit from 6.87% in 1998 it increased to 14.3% in 2001 and 13.4% in 2002. We can see that there is a reduction in operating expense of a company, which further provides high operating profit. Financial charges are reduced but due to shortterm borrowing it has increased for the last year 2002. Company has incurred loss for two years that is for 1998 and 1999 and for other years is also not making profit after tax of more than 4.42% in 2001.

D.M Textile Mills Limited Common-size Income Statement For Year 1998 2002 FIGURE 4. 2

D.M TEXTILE MILL LTD. 120 100

PERCENTAGE

Net Sales

80
Cost of Sales

60
Gross Profit

40 20 0 1998 1999 2000 2001 2002

YEARS

Operating Expense Operating Profit

Figure 4.2 shows D.M textile costs of sales that are high for the first two years and i.e. above 90 % whereas for other three years 2000 to 2002 it is almost 86%. The companys highest operating profits are for the year 2001.

(Colony) Sarhad Textile Mills Limited Common-size Income Statement For Year 1998 2002 TABLE 4. 3

Net Sales Cost of Sales Gross Profit/ Loss Operating Expense Operating Profit/ Loss Other Income

2002 100% 102.71 (2.71) 5.54 (8.25) 2.88 (5.37)

2001 100% 100.53 (0.53) 5.59 (6.12) 0.49 (5.63) 2.69 3.79 (12.11)

2000 100% 112.93 (12.93) 10.64 (23.57) 14.22 (9.35) 11.19 17.76 (37.70)

1999 100% 115.75 (15.75) 11.43 (27.18) 0.99 (26.19) 11.22 6.52 20.81 (64.74)

1998 100% 105.75 (5.75) 4.39 (10.14) 0.16 (9.98) 3.13 2.74 (15.85)

Financial Charges Loss on sale of fixed assets Other charges Profit/Loss Before Taxation Taxation: Current- year Profit After Tax

3.60 2.65 (11.62)

0.50 (12.12)

0.50 (12.61)

0.50 (38.20)

0.50 (65.24)

0.50 (16.35)

Companys common-size income statement depicts its poor performance. The sales of the company are not even the 50% of the sales of other companies included in the research. Moreover its cost of sales is higher than its sales, which on the very first step takes the company into loss. As gross profit of the company shows on average its cost of sales are 7.5% more than its sales. The company is also incurring high operating expenses that further more adds to the loss incurred by the company. For the year 1999 its loss after taxation is 65.24% of the sales.

(Colony) Sarhad Textile Mills Limited Common-size Income Statement For Year 1998 2002 FIGURE 4. 3

(COLONY) SARHAD TEXTILE MILL LTD.

140 120 100
PERCENTAGE Net Sales

80 60 40 20 0 -20 1998 1999 2000 2001 2002 -40

YEARS

Cost of Sales

Gross Profit/ Loss

Operating Expense

Operating Profit/ Loss

The unusual company performance can be observed by the figure 4.3. Costs of sales are even higher than its sales. The company is bearing loss for five years. Supreme gross-loss is for the year 1999 and an operating loss of 27.18%.

4.2 COMMON-SIZE BALANCE SHEET

Common-size analysis of financial statements is expressing each item as a percentage of its major item. As in common-size balance sheet each component is expressed as a percentage of current assets and current liabilities. Commonsize analysis is especially useful in comparing the performance for a particular year with that for current year. Following are the results of the analysis of the companies common-size balance sheet.

Al- Qadir Textile Mills Limited Common-size Balance Sheet For Year 1998 2002 TABLE 4. 4
2002 Current Assets: Inventory Stock in trade Trade Debts Advances, Deposits, prepayments and other receivables Cash & Bank Balances Total current assets 2.86% 47.67 12.05 10.43 26.90 100% 2001 3.14% 50.16 7.97 4.64 34.09 100% 2000 4.78% 58.64 1.59 9.38 25.60 100% 1999 6.08% 65.28 5.47 19.89 3.28 100% 1998 5.67% 53.54 9.69 24.58 6.52 100%

Current Liabilities: Current portion of Long-term Liabilities Short-term borrowings Creditors, accrued & other liabilities Provision for Tax Proposed Dividends Unclaimed Dividend Total current liabilities 14.42 82.95 2.23 0.40 100% 15.16 79.46 1.76 1.96 1.66 100% 25.85 65.68 0.48 7.99 __-__ 100% 12.27 57.09 28.24 2.40 __-__ 100% 29.58 34.30 35.15 1.11 __-__ 100%

Al-Qadir textiles current assets have increased over the years as can be seen from the balance sheet in the appendix. The company has reduced its inventory from 5.67% in 1998 to 2.86% in 2002, which is good in a sense as inventory is the most illiquid form of current assets. Stock in trade is almost 50% of the current assets for all five years. Trade debts are considerably low as compared with the industry, but have gradually increased in the year 2002. Advances,

deposits, prepayments, and other receivables show a variation in the data. Last cash and bank balances have increased for the last three years. Current liabilities were low in the year 2001 and 2000 of Rs.95, 039,484 and Rs.94, 565,386 respectively and for other years it has been above Rs. 10 million. Short-term borrowings are only for two years i.e. 1998 and 1999. Creditors, accrued, and other liabilities constitute the major portion of current liabilities. The same data is depicted in the figure 4.4 (a) and figure 4.4 (b).

Al- Qadir Textile Mills Limited Common-size Balance Sheet For Year 1998 2002 FIGURE 4. 4 (a)
CURRENT ASSETS
Cash & Bank Balances 100% PERCENTAGE 80% 60% 40% 20% 0% 1998 1999 2000 YEARS 2001 2002 Inventory Advances, Deposits, prepayments and other receivables Trade Debts Stock in trade

FIGURE 4. 4 (b)
CURRENT LIABILITIES Unclaimed Dividend

100% 80% 60% 40% 20% 0%

1998 1999 2000
Y EAR S

Proposed Dividends Provision for Tax Creditors, accrued & other liabilities Short-term borrow ings 2001 2002 Current portion of Long-term Liabilities

D.M Textile Mills Limited Common-size Balance Sheet For Year 1998 2002 TABLE 4. 5
2002 Current Assets: Inventory Stock in trade Trade Debts Advances, Deposits, prepayments and other receivables 3.68% 44.51 7.45 39.26 6.21% 36.57 10.02 41.13 4.43% 57.25 6.21 22.70 6.35% 54.93 36.08 9.29% 30.96 55.42 2001 2000 1999 1998

Cash & Bank Balances Total current assets

5.10 100%

6.07 100%

9.41 100%

2.63 100%

4.32 100%

Current Liabilities: Current portion of Long-term Liabilities Short-term borrowings Creditors, accrued & other liabilities Provision for Tax Proposed Dividends Unclaimed Dividend Total current liabilities 22.12 19.03 54.02 4.82 0.14 100% 23.41 21.09 48.24 7.26 __-__ 100% 23.07 28.39 46.50 2.04 __-__ 100% 39.75 20.29 37.24 2.72 __-__ 100% 42.66 14.79 38.38 4.17 __-__ 100%

D.M textile has also increased its current assets for five years. Inventory of the company shows a decreasing trend as can be seen from the table 4.5, starting from 9.29% in 1998 it has reduced to 3.68% in 2002, although high in year 2001. Stock in trade represent the major portion of current assets and show dissimilarity over the years. There are no trade debtors in 1998 and 1999. Company has reduced the advances, deposits, prepayments, and other receivables, which is also the major component of current assets. Average current liabilities are almost equal to Rs. 80 million for five years and there is less fluctuation in it.

D.M Textile Mills Limited Common-size Balance Sheet For Year 1998 2002 FIGURE 4. 5 (a)

CURRENT ASSETS
PERCENTAGE 100% 50% 0% 1998 1999 2000 YEARS 2001 2002

Cash & Bank Balances Advances, Deposits, prepayments and other receivables Trade Debts Stock in trade Inventory

The above figure shows the current assets for D.M textile. Where major portion of current assets is in stock in trade and in advances, deposits, prepayments and other receivables. In addition, inventory is almost less than 10% for five years.
FIGURE 4. 5 (b)

CURRENT LIABILITIES PERCENTAGE 100% 80% 60% 40% 20% 0% 1998 1999 2000 YEARS 2001 2002

Unclaimed Dividend Proposed Dividends Provision for Tax Creditors, accrued & other liabilities Short-term borrow ings Current portion of Long-term Liabilities

The current liabilities are more due to creditors, accrued and other liabilities. The company is also liable to pay current portion of long term liabilities which has reduced

CONCLUSION AND RECOMMENDATION

Financial statement analysis focuses on one or more elements of a companys financial condition or operating results. Researcher emphasizes five areas of inquiry, with varying degrees of importance. Short-Term Liquidity. Ability to meet short-term obligations. Cash Flow Analysis. Future availability and disposition of cash. Return on Invested Capital. Ability to provide financial rewards sufficient to attract and retain financing. Asset utilization. Asset intensity in generating revenues to reach a sufficient profitability level. Operating performance and Profitability. Success at minimizing revenues and minimizing expenses from operating activities over the long run.

5.1 SHORT-TERM LIQUIDITY

Important measures of short-term liquidity for the last five years have been analyzed by the use of liquidity ratios. Al-Qadirs current assets have increased each year except for the year 2000. From 1998 to 2002 its assets have increased by approximately 40%. The companys current liabilities remained high up till 1999 and did reduced for two years then again increases in 2002, as they have more short-term borrowings for the last year. Al-Qadirs liquidity position is far much better then the industry average. D.Ms current assets also show an increasing trend, but that is slow with respect to increase in current liabilities. Current liabilities have accelerated for the reason of more creditors, accrued and other liabilities. (Colony) Sarhad liquidity position is not favorable they have increased their current assets especially inventories and they are not making enough sales, so if they sell those assets they cant even recover the cost. And amounts of their liabilities have increased due to excessive short-term borrowings. They are in a trouble to meet their short-term obligations.

5.2 CASH FLOW ANALYSIS

Al-Qadirs operating cash flows is high for the year 2000, reason being low cost of sales, which have resulted in high profit before taxation. This analysis reveals cash flows are steady source of cash, with a substantial increase in year 2000. The cash down turn in year 1999 is due primarily to financial charges. Investing activities were more in 1999 and 2000, due to major out flow of fixed capital expenditure. Financing out flows are more for the last three years, where dividends are paid in year 2001 and 2002. D.M have been able to maintain high cash flows from operations even after incurring loss before taxation for the year 1998 and 1999. Cash flow has

decreased for the year 2002 because of more payments made to creditors. Investment has increased for 2001 and 2002 by acquiring fixed assets. Whereas financing out flow is more for the year 2001 as company made a repayment of long-term loan. (Colony) Sarhad has incurred losses all the way through the years, which has affected its operating activities. They are not having enough sales even to cover their production costs. In spite of incurring losses they have a addition to fixed asset in year 1998 and 2002, that shows an out flow.

5.3 RETURN ON INVESTED CAPITAL

Al-Qadir return on assets (ROA) shows a variation due to constant increase in assets and fluctuating net income. Net income is supreme for the year 2000. Return on equity (ROE) similarly shows the same trend as ROA. D.M return on assets (ROA) is also changing according to the net income received. Its return on assets (ROA) is lowest for the year 1998 as the cost of sales and operating expenses are high. (Colony) Sarhad is not having any positive return from its assets for the reason of continuously incurring losses for the successive five years.

5.4 ASSET UTILIZATION

Al-Qadirs asset turnover is increasing over last five years. Yet this increase is in asset turnover makes significant changes in turnover for individual asset

components. Cash and equivalents evidence the most significant variability during this period, which is also evidenced from common-size balance sheet. Companys account receivables shows a slight improvement in year 2001. Regarding inventory turnover, company expressed desire to decrease inventories at every stage of its manufacturing process is revealing itself through an improved turnover ratio. It is important to note that Al-Qadirs asset and asset component turnover ratios often compare favorable to industry norms. D.Ms asset turnover is fluctuating over the years as it has decreased for the last year 2002. Cash and equivalents also show a fluctuating trend. Account receivable turnover has decreased for the last year but was better in the previous years. Inventory turnover ratio has improved continuously for all the years.

(Colony) Sarhad s asset turnover has decreased. Inventory turnover is much lower than the industry norms, as companys cost of sales are high and moreover inventory constitutes about 50% of assets. Receivable turnover is also very low as more of their sales are on credit.

5.5 OPERATING PERFORMANCE AND PROFITABILITY

Al-Qadirs gross-profit margin has increased for the first three years and reduces eventually for the year 2001 and 2002, as cost of sales are highest for the year 2002. Operating-profit margin is following the same trend in spite that over the years they have reduced their operating expenses. Net-profit margin is negative for year 1998 and 1999 as they have paid the financial charges and reduced their debt burden.

D.Ms gross-profit margin is stable for the last three years and was low for 1998 and 1999, as their cost of sales were 93% and 92% respectively. Companys operating profit show an increasing trend, excluding the year 2002, their operating expenses are very much stable for five years. Net-profit margin is highest for the year 2001 due to less cost of sales. (Colony) Sarhad starts from the negative gross-profit margin as its cost of sales are higher than its net sales. Therefore, operating-profit and net-profit margin are also negative.

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