I

ARYA SCHOOL
OF MANAGEMENT AND INFORMATION TECHNOLOGY

PATRAPADA, BHUBNESHWAR A PROJECT REPORT ON RATIO ANALYSIS OF ARSSLTD, BHUBNESHWAR

PROJECT REPORT SUBMITTED FOR PARTIAL FULFILMENT OF THE MASTER OF FINANCE AND CONTROL (MFC) UNDER UTKAL UNIVERSITY,ORISSA

SESSION:2010-12 SUBMITTED BY: MANDAKINI PRADHAN ROLL NUMBER: 13767U104016 UNDER THE GUIDENCE OF INTERNAL GUIDE EXTERNAL GUIDE MR.RASHMI RANJAN PANIGRAHI MR.BISHNU MAHARANA (FACULTY OF FINANCE) TAX CONSULTANT

ASMIT

ARSS

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CERTIFICATE
This is to certify that the project study entitled RATIO ANALYSIS OF ARSS LTD is a bonafide work done by Mandakini pradhan,

Regd. No- and submitted in partial fulfillment of the award of degree in Master of finance & Control University Vanivihar, Bhubaneswar Administration Utkal

Date

Mandakini pradhan

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DECLARATION
I, Mandakini pradhan hereby declare that the project report on RATIO ANALYSIS OF ARSS submitted to the company is done under the supervision of Mr. BISHNU MAHARANA, of ARSS Ltd. (Industrial guide) and is my own effort and is not published in any other organization.

Date

Mandakini pradhan Place:Bhubaneswar Roll No:-

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ACKNOWLEDGEMENT
I avail this opportunity to express my profound sense of sincere and deep gratitude to many people who are responsible for the knowledge and experience I have gained during the project work. I am extremely grateful to Mr. Bishnu Maharana, ARSS Ltd. for giving me the opportunity to undergo my Project in his organization. I am also thankful to Mr. Rashmi Ranjan Panigrahi, Faculty (in Finance), Arya School Of Management And Information Technology, for helping me to get such an excited project under his internal guidance. I am also grateful to other members of ARSS for their cooperation throughout the project for getting in-depth knowledge My hearty and inevitable thanks to all the respondents who have helped me to bring out the project in a successful manner.

Mandakini pradhan
TABLE OF CONTENT

CHAPTER

PAGES

INTRODUCTION &COPMPANY PROFILE OBJECTIVE , SCOPE & RESEARCH METHODOLOGY RATIO ANALYSIS CONCLUSION & SUGGESTION APPENDIX BIBLIOGRAPHY

----------- 2-14 ----------- 15-16 ----------- 17-43 ----------- 44-49 ----------- 50-52 ----------- 53-54

Chapter 1

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Introduction of ARSS

VII

ABOUT THE COMPANY:

BREIF HISTORY: The Company was originally incorporated as ARSS Stones Private Limited on May 17, 2000 under the Companies Act, 1956 with its registered office at N1/93, IRC Village, Nayapalli, Bhubaneswar751015, Orissa. The registered office of thye Company was shifted to the Plot No. 38, Sector A, Zone D, Mancheswar Industrial Estate, Bhubaneswar751010 with effect from July 1, 2003. The name of the Company was changed to ARSS Infrastructure Projects Private Limited with effect from May 20, 2005. The Company was converted to a public limited company with a special resolution of the shareholders passed at the extraordinary general meeting held on November 15, 2005 and the Registrar of Companies; Orissa issued a fresh certificate of incorporation on April 3, 2006 in the name of ARSS Infrastructure Projects Limited.

ARSS Infrastructure Projects Limited

Corporate Identification Number: U14103OR2000PLC006230

Registered Office
Plot No. 38, Sector A, Zone-D, Mancheswar Industrial Estate, Bhubaneswar-751010, Orissa Tel.: + 91- 674-2588554 / 52 Fax: +91- 674- 2585074 Website: www.arssgroup.in

Corporate Off ice

Plot No-141, SBI Colony Paschim Vihar, New Delhi-110063 Tel: + 91-11-45538638 Fax: + 91-11-25287357

Compliance Officer: Mr. Bibhuti Bhusan Sahoo, Company Secretary

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BUSINESS SUMMARY: The Company is engaged in construction activities in India. It undertakes construction of railway infrastructure, roads, highways, bridges and irrigation projects. We started as a construction company in the field of railway infrastructure development, mainly in the state of Orissa and subsequently expanded its business activities in the zonal jurisdictions of East Coast Railway, South Eastern Railway, South East Central Railway, Southern Railway and North Western Railway. It has developed expertise in railway construction projects, which includes earthwork, major and minor bridges, supply of ballast, sleepers, laying of sleepers and rails, linking of tracks etc. Over the years it diversified its field of activities into other construction segments such as development and construction of roads, highways, bridges, irrigation projects, EPC activities for railways. Construction projects are typically awarded through competitive bidding process to bidders with certain eligibility requirements based on their past experience, technical capabilities and financial strength. The company bid for projects both on a standalone basis as well as through project specific joint ventures. It has entered into joint ventures with national and international players such as PT Adhikarya (Persero), Harish Chandra (India) Limited, Triveni Engicons Private Limited, RITES, Kalindee Rail Nirman (Engineers) Limited, Patel Engineering Ltd, Rohit Kumar Das Construction Private Limited, Backbone Enterprises Ltd. and Atlanta Ltd. It has successfully completed over 200 km rail line and more than 300 km of roads and highways. It has presence in Eastern India, particularly in the state of Orissa. However, in recent years it has pursued opportunities in other parts of India including states of Chhattisgarh, Rajasthan, Jharkhand, Haryana, Kerala, Andhra Pradesh, Assam, Maharashtra, Tamil Nadu, Gujarat, Uttar Pradesh and Madhya Pradesh.

Some of the important projects being currently executed by the company on standalone/joint venture basis are as follows:
Construction, rehabilitation and widening of Cuttack - Paradeep road, Orissa, for a contract value of Rs. 20,826.77 lacs. Construction of Roadbed including Major and Nior Bridges, Facilities and General Electrification in connection with construction of New BG line between Haridaspur and Paradeep in East Coast Railway in the State of Orissa, India. The contract value for the project is Rs. 10,096.66 lacks. Work Order for execution of Rail Infrastructure Work of Rs.26, 100.00 lacs for the Angul project of Jindal Steel & Power

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Construction of new broad gauge line, bridges, earthwork cuttings, road over bridges, road under bridges and sub ways between Salem-Karur, Chennai. The contract value for the project is Rs. 5,139.05 lacs. Construction of Kaushilia Dam and appurtenant works in Panchkula district of Rs. 11299.19 lacs As of December 31, 2009, our work force consisted of approximately 2,725 full time employees. Company has track record of timely execution of its projects. It adheres to international best practices standards and has been certified with ISO 9001: 2008 Quality Management System Standard Certificate by Moody International Certification Limited for Construction of Civil and Infrastructure Work like Highways Roads, Bridges, Railway Track Linking Works (including OHE SNT), Earth Works, Irrigation Projects Like Dams etc We are committed to adhering to health, safety and environment policies and practices in the execution of our projects. In the FY 2010, the total income of the company was Rs. 101308.55 lacs and earned net profit of Rs. 9007.32 lacs.

Table : Works of the Company

Particulars
Railway Work Road Work Irrigation Other Work Total Income

On Dec 2009
Amount % 27,593.68 45.63 19,681.63 32.55 4,450.45 8,743.18 7.36 14.46

2008-09
Amount % 16,884.75 27.40 29,126.60 46.65 2,995.50 4.80

2007-08
Amount % 10,195.75 32.50 10,479.51 33.41 2,122.53 8,569.30 6.77 27.32

2006-07
Amount 7,626.42 3,141.84 2,531.88 % 57.34 23.62 19.04

13,430.68 21.51 62,437.53 100.00

contract 60,468.94 100.00

31,367.09 100.00

13,300.14 100.00

As of January 10, 2010, total value of our Order Book is Rs. 287,753.11 lacs, which consists of the unexecuted portions of the ongoing projects and new confirmed projects awarded to the company, which are yet to commence construction. The composition of the Order Book is as follows: -

Table.: Composition of the Order Book Particulars On January 10, 2010 2008-09 Amount Railway Works Road Works 118,414 116,405 % 41.15 40.45 2.53 15.87 100 Amount 99,121.48 42,149.41 5,709.98 5,545.00 % 39.25 56.29 2.26 2.20 2007-08 Amount 81,222.98 60,854.35 8,705.47 3,648.00 % 52.6 39.41 5.64 2.36 2006-07 Amount 27,628 37,156 64,784 % 42.65 57.35 100

Irrigation works 7270 Other Works Total 45,664 287,753.11

155,525.87 100

155,430.80 100

Companys order book as on January 10, 2010 stood at Rs.2877.53 Cr. The composition of Order Book is well diversified over various segments such as railways, roads and highways and Road over Bridges (ROB). Diversification into new areas of construction projects helps the company to mitigate the risk of slowdown in revenues from any segment due to unforeseen circumstances. The reason of increasing and then decreasing % of railway works due to the government launched new projects in 2007-06 and 2007-08 where as no of launched projects in 2008-09 and 2009-10 comparison to previous years are very less. Growth in the roads sector had declined from 2007-06 to January 2010 as various issues had delayed the award of National Highways Authority of India (NHAI) projects. The growth momentum, built in the last 4-5 years, has seen limited progress since March 2007. There has been a complete lull in awarding NHDP projects in 2008-09. Since July 2008, around 6,000 km from Phase III and Phase V were in different stages of bidding process and were expected to be awarded by December 2008. However, no stretches had been awarded till November 2008. The awarding of NHDP projects had slowed down from 5,131 km in 2005-06 to a mere 1,000 km in 2007-08. According to CRISIL Research, investments in the roads sector declined from Rs. 357 billion in 2007-08 to Rs. 345 billion in 2009-10. Consequently, the share of roads in total infrastructure construction investments declined from 36.1 per cent during 2007-08 to 26.6 per cent in 2009-10. CRISIL expects the segment to see growth in 2010-11, when more number of projects to be awarded on BOT-annuity or cash contract basis. CRISIL expects this segment to see growth in 2010-11, when more number of projects will be awarded on BOT-annuity or cash contract basis.

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According to CRISIL Research, irrigation construction investment is expected to grow from Rs. 155 billion in 2007-08 to 241 billion in 2009-10. Consequently, the share of irrigation in the total infrastructure construction investments is expected to increase from 15.7 per cent during 2007-08 to 18.6 per cent in 2009-10. Irrigation projects include construction of dams, water reservoirs, small hydropower projects (10-20 mw capacity) and lift and gravity technology to create water distribution networks. IVRCL leads the irrigation construction segment followed by other companies like Gammon, Hindustan Construction Company (HCC), Nagarjuna Construction Company (NCC), Patel Engineering etc. According to CRISIL Research, irrigation construction investment grew from Rs. 155 billion in 2007-08 to 241 billion in 2009-10. Consequently, the share of irrigation in the total infrastructure construction investments is expected to increase from 15.7 per cent during 2007-08 to 18.6 per cent in 2009-10. Irrigation projects include construction of dams, water reservoirs, small hydropower projects (10-20 mw capacity) and lift and gravity technology to create water distribution networks. IVRCL leads the irrigation construction segment followed by other companies like Gammon, Hindustan Construction Company (HCC), Nagarjuna Construction Company (NCC), Patel Engineering etc.

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ORGANIZATIONAL HIERARCHY: THE COUSTOMERS:

The Company is totally entrusted in its customers satisfaction and confidence based on its providing services. The Companys valued customers are;

Govt. of Orissa Govt. of Haryana Rail Vikash Nigam Limited RITES Limited IRCON International Limited National Thermal Power Corporation(NTPC) National Highway Authority of India (NHAI) ESSEL Mining Damodar Valley Corporation Orissa State Disaster Mitigation Authority (OSDMA) Indian Oil Corporation Limited (IOCL). Hindustan Petroleum Corporation Limited (HPCL). Jaipur Development Authority East Coast Railway South Eastern Railway North Western Railway Southern Railways Central Railway Northeast Frontier Railways Tamil Nadu Industrial Road Infrastructure Corporation Limited. Jindal Steel And Power Limited Vishakhapattanam Steel Plant Rourkela Steel Plant Vedanta Aluminum Limited
.

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SWOT ANALYSIS: Strength of the Company:

The company depends largely upon the services of its key managerial personnel and to attract and retain them; Its competitive strengths include its project management expertise The company has successfully executed 86 projects involving construction of 300 km roads and highways, 200 km of rail tracks, 10 minor and major bridges, and other general civil engineering works over the span of nine years. It owns a sizeable fleet of construction equipment, enabling it to rapidly mobilize the same to project sites. The company has a advantage of construction equipment. Also the company has a large investment in equipments and fixed assets. As on March 31, 2010 the total investment in plant and equipment is Rs 25,832.08, lacks. Railways are the major revenue source, accounting for 45.6% of total revenues in the period of 9 months till December 31, 2009. The company's focus and strength has been in the Eastern region of India historically, particularly state of Orissa. Around 44% of FY09 revenues are attributable to projects located in Orissa. Majority of the clients are the Governments of the states or Central Government, Public Sector Undertakings, and other government agencies. The order book as on January 10, 2010 stands at Rs 287753.11 lacks. The composition of the order book is well diversified over various segments such as railway, roads and highways. In 2007 the company entered into two different segment of irrigation and canal construction works. Diversification of the business mitigates the risk associated with the unforeseen circumstances. The company is continuously growing in their bid capacity and prequalification capability where as the bid capacity and prequalification capability largely depends upon technical capability, financial capability and past experience in similar projects.

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Weakness of the Company:

Some of group companies namely Anil Contracts Private Limited, M/s Hindustan Construction, M/s Anil Agarwal and ARSS Engineering and technology Private Limited are in the same line of business, which may arise the conflict of interest

between the group of companies and the business strategy of the company; Some of the entities promoted by the promoters are in the same line of business. Hence the company may not get the full benefit of their promoters focused attention and managerial skills. This may arise the conflict of interest between the promoters and the business strategies of the company; The group companies incurred the loss in previous years which can affect the business of the company; The company have not carried out an independent appraisal of the working capital management; The companys revenue totally depends on the contracts awarded by Central and State Government and their agencies. The company relies on the limited no of supplier and vendor viz. Hindustan Petroleum Corporation Limited (HPCL) and Indian Oil Corporation Limited (IOCL), in order to meet the raw material requirement. Failure on the part of the supplier to deliver the desired quality and quantity of the product may adversely impact on the companys business and financial health. There are no certainties regarding the completion of the projects. It can be cancelled, postponed the payment, delayed etc. By which the cash flow statement, revenues and earnings etc are affected. The insurance coverage of the company may not protect against certain operating hazard. The working capital requirement of the company is dependent on the bank finance. Any changes in interest rates or banking policy will adversely affect the companys business.

Defaulted

on

payment

of

interest

and

repayment

of

loan

ARSS has defaulted in making payment of interest & repayment of loans in the past. However, the company has cleared all its dues before filing the prospects .In case the company defaults in making payment in the future it could pose a serious sets.

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Opportunity for the Company: Company's emphasis on the Railways segment can be a positive from the growth
point of view, given that Indian Railways are likely invest huge sums in expanding and upgrading the railways infrastructure in the country.

The company is totally concentrated on a single stats i.e. Orissa which can be a
positive side for the company. Because every year new project come to the Orissa; in recent years POSCO and Arcelor- Mittal steel project came to Orissa.

Indian Railways had increased expenditure from Rs820bn in the Tenth 5 year Plan, to
Rs2441bn during the Eleventh 5 year plan period, which kicked off in April, 2007. A significant portion of the increase in expenditure would be directed towards building new lines (of about 2,000 Km), doubling of track, electrification, computerization, rolling stock, signal and telecommunication works, and bridge works, amongst others.

A huge growth in railway construction is based on the proposed outlays planned

through the Eleventh 5 year plan, Mission 2015 and several new initiatives. The Ministry of Railways has also floated the Integrated Modernization Plan to keep pace with the expected growth in business for railways. Roads, incl. national highways and state roads continue to drive construction investments. The key programmes during 11th five year plan under road development include the National Highway Development Programme (NHDP), Pradhan Mantri Gram Sadak Yojana (PMGSY), and Special Accelerated Road Development Programme for the North East (SARDP - NE), in addition to other state level projects. The company has a bigger opportunity to invest in these projects. Irrigation is expected to drive infrastructure investments. According to CRISIL Research, irrigation construction investment grew from Rs155bn in FY08 to Rs241 billion in F10. Consequently, the share of irrigation in total infrastructure construction investments is expected to increase from 15.7% during FY08 to 18.6% in FY10. According to CRISIL, in the medium term, Andhra Pradesh, Gujarat, Maharashtra, Karnataka and Uttar Pradesh are expected to witness substantial investments in the irrigation sector. Over the next 5 years, around Rs400bn worth of irrigation projects have been envisaged by Andhra Pradesh alone.

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Threats for the company:

The following can be threats for the company:

Increasing competition in bidding process; face competition from national and international companies High working capital requirement; if deficiency will occur, that will affect the financial strength of the company Increase in cost or non-availability of equipment, materials or fuel; Engagement of sub-contractors or other agencies in the course of execution of road and railway projects; A significant portion of the revenue and the order book being concentrated in Eastern India; Dependence on joint ventures to qualify for the bidding process; Seasonality and weather conditions; Changes in Government policies and the political situation in India; Statutory taxes and other levies, which may affect the margin in the event of inability to factor such expenses in bids or contract price The Company may be liable for defaults committed by the Joint Venture Partners in the course of execution of the projects undertaken by it jointly with such Joint Venture Partners

The conditions and restrictions imposed by the lenders could restrict ability to expand companys business and operations. The company should complete the projects in time. Failure to adhere to agreed timelines could adversely affect the companys reputation and/or expose to financial liability.

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Business Strategy:
The company is totally concentrated on maintaining their performance in this sector. The company shall continue to bid for contracts from Government, quasi Government or development organizations across India. Over the last two years it has expanded our operations from Orissa to states like Chhattisgarh, Tamil Nadu, Rajasthan, Jharkhand, Andhra Pradesh, Kerala, Haryana, Assam, Maharashtra, Gujarat, Uttar Pradesh andMadhya Pradesh etc. to avail of opportunities across different states of India. It has recently succeeded in qualifying for the six-laning of two stretches of National Highway No. 5 (NH-5) in southern states of Andhra Pradesh and Tamil Nadu.

Infrastructure construction is a highly competitive and capital-intensive activity. Optimal utilization of financial, human and other resources is crucial for achieving success in this industry. The companys strategy will be to continue focusing and structuring on optimum capital utilization to enhance returns, by actively analyzing and identifying projects and assigning priority to high margin yielding projects. It also intends to improve capital efficiency by striving for accelerated completion of projects.

Forging alliances with established Indian and international strategic partners The company intends to develop and continue to establish strategic alliances with companies, whose resources, skills and strategies are complementary to its business, which would enhance its business opportunities to achieve competitive bidding advantage.

Business Development
The company is awarded contracts pursuant to a competitive bidding process. Government and other clients typically advertise their proposed projects in leading national newspapers or on their websites. The tendering department reviews newspapers and websites to identify suitable projects. The tendering department evaluates bid opportunities and the project merits are discussed internally with the senior management based on parameters like client's reputation and financial strength, the geographic location, current projects and order book, the project's cost and profitability estimates and competitive advantage relative to other likely bidders. Once the department has identified projects that meet criteria, company submits its application as per the specified procedures.

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Joint ventures of the company:

The Company has entered into joint ventures with various established construction houses viz; Harish Chandra (India) Limited, Kalindee Rail Nirman (Engineers) Limited, Triveni Engicons Private Limited, PT Adhikaria (Persero) and Niraj Cements Private Limited. The joint venture partners aforesaid have vast experience and expertise in execution of civil construction, bridge construction, earth excavation, road construction works and civil engineering works awarded by Government departments and authorities. The Company together with the joint venture partners aforesaid has undertaken projects awarded by Government authorities and Public Sector Units such as NABARD, RITES, and NTPC etc. The joint venture partners, in mutual consultation with one another determine the quantum of work to be executed by each joint venture partners vide entering into memoranda of understanding/joint venture agreement. The work awarded to joint venture is executed by them independently or through the sub-contracting to the third party including the joint ventures partners. The Company has entered into following joint venture agreements: -

Recent Secured Projects:

ARSS Infrastructure Projects Limited bags order from SAIL of Rs 47.89 crore is for the re-habilitation and up gradation of existing tracks inside the plant premises. The time for completion is 24 months on May 8, 2010. ARSS Infrastructure Projects secures order From SAIL ARSS Infrastructure Projects has received a new work order from SAIL, Bokaro Steel Plant on May 05, 2010 for Rs. 71.62 crore. ARSS Infrastructure Projects receives new order worth Rs 99.90 crore From Madhya Pradesh Road Development Corporation ARSS Infrastructure Projects has received a new work order from Madhya Pradesh Road Development Corporation for Rs 99.90 crore on May 04, 2010.

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Chapter 2 Objective, Scope & Research Methodology

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OBJECTIVES OF THE STUDY

Focus on determining financial strengths and weakness of ARSS Infrastructure Projects Ltd. To study and analyze the liquidity position, operating efficiency of the organization. To analyze the trends in various items included in the Balance sheet and income statement using Ratio analysis. Interpreting the results of the study for meaningful conclusion and suggestions.

METHOD LOGY
The study banks upon both the primary as well as secondary sources for gathering the required information. Secondary Data sources : Secondary data are collected from internal sources as well as from external sources. The secondary sources include : Annual Reports Commercial Data Books of account of the company Published reports relevant to the topic News, letters and other publications Websites

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Chapter-3

PRESENTATION ON RATIO ANALYSIS

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RATIO ANALYSIS
Meaning of Ratio
A ratio is a simple arithmetical expression of the relationship of one number to another. It may be defined as the indicated quotient of two mathematical expression. According to Accountants Handbook by wixon, kell & Bedford, a ratio is an expression of the quantitative relationship between two numbers.

Use and Significance of Ratio Analysis

Ratio analysis stands for the process of determining relationship of items group of items in the financial statement. It is an important technique of financial analysis. It is a way by which financial stability and health of a concern can be judged. The following are the main points in use of ratio analysis. Helps in Decision Making. Helps in Financial forecasting and planning. Helps in communicating. Helps in co-ordination. Helps in control Utility to shareholders Utility to Creditors. Utility to Employees. Utility to Government. Tax and audit Requirements

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Objectives of Ratio Analysis

Financial Forecasting Facilitates comparison Cost Control Proper Communication

Guidelines or Precautions For Use of Ratios

The calculation of ratios may not be difficult task but there use is not easy. The information on which these are based, the constraints of financial statements, objective for using them, the caliber of the analyst, etc.are important factors which influence the use of ratios. Following guidelines or factors may be kept in mind while interpreting various ratios. Accuracy Of Financial Statements Objective or Purpose of Analysis Selection of Ratio Use of standards Calibre of the Analyst Ratio only provide a Base

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LIMITATIONS OF RATIO ANALYSIS

Limited use of time Lack of adequate standards Inherent limitations of Accounting Change of Accounting Procedure Window Dressing Personal Bias Uncomparable Absolute Figures Distortive Price Level Changes Ratios no Substitute

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Classification of Ratios
The ratio analysis is one of the most powerful tools of financial analysis. Broadly ratios are classified into four categories. a) Liquidity Ratio b) Activity Ratio c) Profitability Ratio d) Leverage Ratio

a) Liquidity Ratios.
Liquidity refers to the ability of a concern to meet its current obligations as and when it becomes due. It determines the credit worthiness of a company to meet its short term liabilities or commitments. To measures the liquidity of a company, the following ratios can be calculated.

i) ii) iii)

Current Ratio Quick or Acid test or Liquid Ratio Absolute Liquid Ratio/Cash Position Ratio

i)

Current Ratio

Current ratio may be defined as the relationship between current assets and current liabilities. Current ratio, also known as working capital ratio, is a measure of general Liquidity and is most widely used to make the analysis of a short term financial position or Liquidity of a firm. It is calculated by dividing the total of current assets by the total current liabilities,

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Interpretation.
A relatively high current ratio is an indication that the firm is Liquid and has the ability to pay its current obligations in time as and when they become due. On the other hand, a relatively low current ratio represents that the liquidity position of the firm is not good and the firm shall not be able to pay its current liabilities. As a convention the minimum of 2:1 ratio is referred to as a bankers rule of thumb.

ii)

Quick or acid test or liquid ratio

Quick ratio also known as acid test or Liquid ratio is a more rigorous test of liquidity than the current ration. It may be refined as the relationship between quick or liquid assets and current liability. Current assets excluding inventories, work in progress and prepaid expenses are known as quick assets or liquid assets.

Liquid Ratio Interpretation

Usually a high acid test ratio is an indication that the firm is liquid and has the ability to meet its current obligations. On the other hand a low quick ration represent that the firms liquidity position is not good. As a rule of thumb or as convention quick ratio of 1:1 is considerable satisfactory

(iii) Absolute Liquid Ratio/ Cash Ratio Absolute liquid ratio is the relationship between the absolute liquid assets and the current liabilities. Absolute liquid assets are find out by subtracting the bills receivable and sundry debtors from the liquid assets.
Absolute Liquid Ratio

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Interpretation:
The standard norm is 0.5:1 or 1:2 which means that Re.1 of absolute liquid assets are sufficient to pay Rs. 2 worth of current liabilities. This ratio is not used widely because a huge amount of idle cash has to be kept.

(b)Efficiency / Activity Ratios

Activity ratios measure the efficiency or effectiveness with which a firm manages its resources or assets. These ratios are also called turnover ratios because they indicate the speed with which the assets are converted into sales. Basically there are three activity ratios: (i) Inventory /Stock Turnover Ratio. (ii) Debtors Turnover Ratio. (iii)Creditors /payable Turnover Ratio.

(i) Inventory / Stock Turnover Ratio

Every firm has to maintain a certain level of inventory of finished goods so as to be able to meet the requirements of the business. The level of inventory should neither be too high nor be too low. High level of inventory is not satisfactory due to the unnecessary blockage of capital, over stocking, chances of pilferage, theft etc. On the other hand, too low inventory may mean loss of business opportunities. Hence an optimum level of inventory should be maintained.

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Interpretation
Inventory turnover ratio measures the velocity of conversation of stock into sales. Usually a high inventory turnover ratio indicates efficient management of inventory because more frequently the stocks are sold, the lesser amount of money is required to finance the inventory. On the other hand a low inventory turnover ratio indicates an inefficient management of inventory.

(ii) Debtors / Receivable Turnover Ratio

A concern may sell goods on cash or as well as on credit. Credit is one of the important elements of sales promotion. Debtors arise due to the credit policy adopted. So it is necessary to find out the velocity of debt collection of the firm.

(a) Debtors Turnover Ratio

Debtors turnover indicates the velocity of debt collection of the firm. In simple words, it indicates the number of times the debtors are turned over during a year.

Trade debtor = Sundry debtors + Bills receivable and accounts receivable.

Interpretation
Debtors velocity indicates the number of times the debtors are turned over during a year. Generally, higher the value of debtors turnover ratio the more efficient is the management of debtors/sales or more liquid are the debtors. Similarly low debtors turnover implies inefficient management of debtors/sales and less liquid debtors. (b) Average collection Period Ratio The average collection period represents the average number of days for which a firm has to wait before its receivables are converted into cash.

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So,

Interpretation
Average collection period ratio measures the quality of debtors. Generally, the shorter the average collection period the better is the quality of debtors as a short collection period implies quick payment by debtors. Similarly, a higher collection period implies an inefficient collection performance which adversely affects the liquidity or short-term paying capacity of the firm.

(iii) creditors/Payable Turnover Ratio

In the course of business operations, a firm has to make credit purchases and incur short-term liabilities. A supplier of goods, i.e., creditors, is naturally interested in finding out how much time the firm is likely to take in repaying its trade creditors.

Interpretation
The ratio indicates the velocity with which the creditors are turnover in relation to purchases. Generally, higher the creditors velocity better it is or otherwise lower the creditors velocity, less favorable are the results.

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Average Payment Period Ratio.

Interpretation
The average payment period ratio represents the average number of days taken by the firm to pay its creditors. Generally, lower the ratio better the liquidity position of the firm and higher the ratio, less liquid is the position of the firm. iv) Working Capital Turnover Ratio: - Working capital turnover ratio indicates the no. of times the working capital is turned over in the course of a year. It measures the efficiency with which the working capital is being used by a firm.

A higher ratio indicates efficient utilization of working capital and a low ratio indicates otherwise. But a very high working capital turnover ratio is not good for any firm. This ratio can be used for making of comparative and trend analysis for different firms in the same industry and for vary industry to industry.

Profitability Ratios
Profitability Ratios:Profitability is the overall measure of efficiency of the operations of the business. It indicates the effectiveness of the decision taken by the management from time to time.

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The main objective behind the calculation of profitability ratios to enlighten the end results of the business activities which will be the main criterion for the assessment of the efficiency of the business. The lower profitability ratios may arise because of high expenditure, and other such reasons. The external parties like bankers, creditors, suppliers, financial institutions etc., look at the profitability ratio of the company to safeguard for the interest on lending. Equity share holders look at the profitability ratio from the point of view of return to their investment. Let us discuss the important profitability ratios. i. Gross Profit Margin Ratio:- The gross profit margin ratio shows the margin left after meeting manufacturing cost. It is calculated as under:

If the gross profit ratio is higher it is better. A lower gross profit ratio indicates the unfavorable conditions such as lower selling price without proportionate reduction in cost of production etc. It may be used as an indicator of the efficiency of the production operation and the relation between production costs and selling price.

ii. Operating Ratio:- The operating ratio indicates the proportion of cost of sales to sales. The cost of sales comprise of the cost of goods sold plus other operating expenses. The ration can be calculated as under:

Cost of goods sold = Opening stock + purchase + direct expenses + manufacturing expenses - closing stock or sales gross profit.

Operating expenses = Administrative expenses + selling and distribution expenses. In case of operating expenses, a lower ratio is better. A higher operating ratio means smaller margin of operating profit.

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iii. Operating Profit Ratio:- The operating profit ratio compares the relationship between the operating profit and the sale. This ratio is calculated as under:

Operating profit = Net profit + non- operating expenses non-operating expenses. Or Gross profit Operating expenses. iv. Net Profit Ratio:- The net profit ratio indicates the per rupee profit earning capacity of sales. In case of a lower cost of sales, the net profit ratio will be higher. The ratio can be calculated as under:

The ratio shows the earning left for shareholders (both equity and preference) as a percentage of net sales. It measures the overall efficiency of production, administration, selling, financing, pricing, and tax management.

v.

Return on Capital Employed:- The ratio is also called overall profitability ratio. This

ratio shows the earning capacity of the capital employed in the business. It is calculated as under:

Operating profit is the profit before interest and tax. Capital employed includes the total of equity share capital, preference share capital, undistributed profit, reserves and surplus long term liabilities less factious assets and non-business assets. This ratio reflects the overall efficiency with which the capital is employed. vi. Return on shareholders Fund:- This ratio measures the profitability of the firm from the view point of shareholders. This ratio can be calculated as under:

A higher ratio is better which indicates a good return to the shareholders.

XXXIII

vii. Return on Equity:- The return on equity (ROE) is an important profit indicator to shareholders of the firm. It is calculated as under:

viii. Return on Total Assets:- The return on total asset ratio indicates the profit after tax against the investment in total assets. It helps to know whether the assets are using properly or not. It can be calculated as under:

ix. Earning Per Share:- The earning per share ratio helps in determining the market price of equity share of the company and its capability to pay the dividend to shareholders. It is calculated as under:

The earning per share ratio are mainly useful for companies with public traded shares. x. Price Earning Ratio:- Price earning ratio shows the market value of every rupee earning in the firm. The ratio is mainly used to compare the industry average. A high price earning ratio indicates an overvalued share and low ratio shows that the share is undervalued. The ratio is calculated as under:

The price earning ratio helps the investor in making purchase decision on a particular share. xi. Payout Ratio:- The payout ratio shows the portion of earning per share used for the distribution of dividend and the portion retained for the ploughing back of profit. This ratio is calculated as under:

XXXIV

xii. Dividend Yield Ratio:- Dividend yield ratio helps those investors who are interested in dividend. This ratio is calculated as under:

a)Coverage Ratio:Coverage ratios are used to test the adequacy of cash flows generated through earnings for the purposes of meeting debt and lease obligations, including the interest coverage ratio and the fixed charge coverage ratio. Coverage ratios give the relationship between the financial charges of a firm and its abilities to serve them. There are mainly three ratios under this head. Those are: i. Fixed Interest Cover Ratio: - Fixed interest cover or the interest coverage ratio measures the ability of the concern to service its debt. This ratio tells us how many times the firm can cover or meet the interest payments associated with debt. From lenders point of view, this ratio assumes greater importance. The ratio is computed with the following formula:

ii. Fixed Dividend Cover Ratio:- This ratio is computed by preference share holders. It is computed as under:

iii. Debt Service Coverage Ratio:- This ratio indicates the ability of the firm to repay the interest and installments on time. This ratio is important from creditors point of view. This can be calculated as under:

(r = tax rate) (c) Leverage Ratio / Test of Solvency. The term solvency refers to the ability of a concern to meet its long-term obligations. The long-term creditors of a firm are primarily interested in knowing the firms ability to pay regularly interest on long term borrowings, repayment of the

XXXV

principal amount on maturity and security of their loans.

Long-term solvency

ratios indicate a firms ability to meet the fixed interest and costs and repayment of long-term borrowings. The following ratios determine the solvency of the concern: (I) (ii) (iii) Debt-Equity Ratio Proprietory Ratio Interest coverage Ratio

i)Debt-Equity Ratio Debt-equity ratio also known as External-Internal Equity Ratio is calculated to measure the relative claims of outsiders and the owners (i.e., shareholders) against the firms assets. This ratio indicates the relationship between the external equities or the outsiders funds and the internal equities or the shareholders fund.

The shareholders funds consist of equity share capital, preference share capital, capital reserves, revenue reserves, reserves for contingencies, sinking funds etc. Outsiders funds include both current and fixed liabilities. Interpretation The debt-equity ratio is calculated to measure the extent to which the debt financing has been used in a business. The ratio indicates the proportionate claims of owners and the outsiders claim against the firms assets. A ratio of 1:1 may be usually considered to be a satisfactory ratio. ii) Proprietory Ratio / Equity Ratio The proprietory ratio also known as equity ratio establishes the relationship between shareholders funds to the total assets of the firm. This is an important ratio in determining the long-term solvency of a firm. Proprietary Ratio

XXXVI

Interpretation As equity ratio represents the relationship of owners funds to total assets, higher the ratio or the share of the shareholders in the total capital of the economy better is the long-term solvency of position of the company. (iii) Interest Coverage Ratio This ratio is used to test the debt-servicing capacity of a firm. This ratio is calculated by dividing the net profit before interest and taxes by fixed intrest charge. ICR= netprofit before interest and tax/ fixed interest Interpretation Interest coverage ratio indicates the number of times interest is covered by the profits available to pay the interest charges. Generally, higher the ratio, more safe is the long-term creditors. iv)Leverage Ratio: All the business enterprises employee debt fund and equity fund, so as to maximize the profits and earning available for the equity share holders. The basic advantage of using the debt is i.e. the after tax cost of debt is less and the interest is deductable. The term leverage refers to employment of debt fund. A leverage ratio indicates the use of debt fund in the capital structure of the concern. When earning exceeds the cost of funds, it is said to be favorable and when the return is the less the cost of fund it is said to be unfavorable. The leverage is three types. Operating leverage Financial leverage Combined leverage

XXXVII

Operating Leverage: It indicates the extent of the change of earning before interest and tax due to the change in sales volume. It is calculated by the following formula.

Contribution is nothing but sales minus variable cost. There is inverse relationship between the operating leverage and fixed cost. Higher the fixed cost, lower is the contribution. Lower the fixed cost, higher is the contribution. EBIT is not anything but sales less variable cost, less fixed cost. A high operating leverage ratio means large effect on EBIT due to small changes in sales. The operating leverage explains the impact of changes in sales revenue and operating incomes. Financial Leverage: When the firm uses debt fund in its capital structure to finance its need, then the firm is said to financial leverage. Financial leverage measures the changes in the earning before tax due to change in earning before interest and tax (Operating Incomes). The formula is

This leverage may be favorable or unfavorable. When the return on investment exceeds the cost of debt capital, a firm is said to have favorable financial leverage. It is also known as trading on equity. When the cost of debt capital exceeds the return on investment, then the firm is said to have unfavorable financial leverage. Combined leverage Combined leverage = operating leverage x financial leverage

XXXVIII

Ratio analysis based on the year 2008, 2009, 2010 and 2011
Particulars 2008 2009 2010 2011

Liquidity Ratio Current Ratio Liquid ratio Cash ratio Solvency Ratio Debt ratio equity 0.96 33.7 0.66 0.78 1.44 29.44 0.71 0.99 1.30 34.46 0.66 0.78 1.59 36.21 0.73 0.86 2.27 1.61 0.39 2.72 1.29 0.54 4.09 1.39 0.64 3.76 1.36 0.67

Equity Ratio Solvency ratio Interest coverage ratio Activity ratio

Stock turn Over ratio Debtor turn over ratio Working capital turn over ratio

5.90

3.38

2.38

2.23

7.9 2.6

11.5 2.76

16.6 1.91

17.02 2.21

XXXIX

Profitability Ratio Gross ratio profit 19.32 15.39 27.18 8.61 21.64 14.57 34.58 8.02 24.24 12.28 26.41 8.95 26.06 17.68 28.45 8.03

Operating profit ratio ROI Ratio Netprofit ratio

XL

Observation of ratio analysis

Current Ratio
4.5 4 3.5 3 2.5 2 1.5 1 0.5 0 2008 2009 2010 2011

Last four year current assets is showing more than rule of thumb i.e. 2:1 but as the business is operating in construction of road and rail bridge etc. where more current assets is required than other. So company is maintaining high current assets . Another important point is that last two year company has got many project in rural area, forest area , hill area and the district like koraput , kalahandhi etc where the communication and transportation and bank facility is not so good. For transporting of raw materials from god own or supplier it requires more time , So company requires to maintain more stock of raw materials so that operation will not stop in future. As the banking facility is not good in that area , company is required to maintain more cash in hand for the day to day expenditure.

Liquid ratio
1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 1 2 3 4

XLI

Companys quick ratio is not satisfactory. In 2007-08 due to increase in sundry debtor of 102% than previous year and decrease in sundry creditor of 15% than previous year this ratio was increased to 3.32 which is not a good sign .But in 2008-09 due to more increase in sundry creditor than sundry debtor it has decreased to 1.61 . In 2008-09 due to reduce in sundry debtor and increase in sundry creditor it has reduced to 1.29 which is the minimum in last five year. But in 2009-10 due to more increase in sundry debtor than sundry creditor from previous year it has again increased to 1.93. If this ratio will again increase it will affect the liquidity position of the firm.

Cash ratio
0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 2008 2009 2010 2011

Cash ratio is much satisfactory . The company will not face any difficulty of liquidity in future. It will also help in bidding for new project . Over all short trem financial position of the company is very good.

XLII

Debt equity ratio

1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2008 2009 2010 2011

This ratio indicates that company is using more out side debt in financing the business compare to own fund . AS a result it has been providing better return to the share holders. This ratio shows that in 2009-10 total out side long term debt is 1.3 times of owners fund . Higher the debt equity ratio , share holders get higher return and vice versa . But there should be proper mix of debt and equity ratio .It indicates that company will not face any difficulty in getting future credit facility with out paying high rates of interest and with out accepting undue pressures and conditions of the creditors . company should maintain minimum this ratio in

Equity Ratio
40 35 30 25 20 15 10 5 0 1 2 3 4

Equity ratio shows that from 2008 it has been increasing every year which is good sign for the share holders. It is attracting more investor to invest their surplus money in the company and it also helps in increasing market price of share. In 2008 due to payment of dividend for the first time ,it has been dereasing. The increasing equty shows that earning power of the company has increased in now a days.

XLIII

Solvency ratio
0.74 0.72 0.7 0.68 0.66 0.64 0.62 2008 2009 2010 2011

The solvency ratio is show the liability to outsider.In 2008 is low but now a days it will be Increasing,it is based on the good financial position

Stock turn over ratio

7 6 5 4 3 2 1 0 20087 2009 2010 2011 Stock turn over ratio

Inventory turnover ratio basically tells about the efficiency of the firm in taking the project and to plish that. The inventory turnover shows how rapidly the inventory is turning into receivables through sales. A high inventory turnover ratio is good because the no of days converting the inventories into the sales will become less. As in 2008 the inventory turnover ratio is 12.61 times so the inventory holding days is only 29 days while from 2010 to 2011 the inventory turnover ratio decreasing means the no of days in inventory converting is increasing. This can bad for the organization as this creates tieup of funds, reduced profit, and increased costs

XLIV

Debtor turn over ratio

18 16 14 12 10 8 6 4 2 0 2008 2009 2010 2011

Debtors Turnover ratio indicates the no of times debtors turnover each year. Higher the value of debtors turnover, the more efficient is the management of credit because the collection period of the debtors will low. Maximum debtors turnover ratio in all four years is 16.57 in 2010-11. It increases from 2008-09 also there is sudden jump in collecting the amount of debtors in 2008-09 and in 2009-10. The increased Debtors Turnover Ratio shows the better management in debtors collection (from its joint venture companies).

Working capital turn over ratio

3 2.5 2 1.5 1 0.5 0 2008 2009 2010 2011

XLV

The working capital turnover ratio of ARSS declined from 2010 to 2011, however it increased in 2008-09. The reciprocal of the ratio is , 2.6, 2.8,1.91 and 2.21 continuously . In previous years the company incurred less money for sales while in these years specially in 2009-10 it is unable to take projects in that amount. The company is increasing its sales by increasing in the net working capital.

Gross profit ratio

30 25 20 15 10 5 0 2008 2009 2010 2011

This ratio indicates that company has been reducing its cost of contract revenue from year to year. As a result in 2008 when company was earning 19.32% gross profit , now in 2010 it is earning 24.24% of gross profit on contract revenue. This ratio indicates that all the raw material, spare parts etc are properly utilized by the company. This ratio also indicates that company is able to meet any increase in operating expenses with out decreasing in net profit. ARSS enjoys a gross profit of 26.06% in 2010 which means that for every rupee apart from cost of goods sold

XLVI

Operating profit ratio

20 18 16 14 12 10 8 6 4 2 0 2008 2009 2010 2011

This ratio indicates that operating expenses have been increasing from to year which is not a good sign for the company . The reason for increase in operating expenses is increase in personal expenses. Company wants to pay good salary to its employees and hire better personal for getting better result. Another important reason for increasing personal expenses is increasing inflation. Now the inflation rate is more than 10%. This ratio indicates that in 2009-10 87.7% of contract revenue have been consumed by operating cost .

Net profit ratio

9.2 9 8.8 8.6 8.4 8.2 8 7.8 7.6 7.4 2008 2009 2010 2011

XLVII

This ratio indicates that there has been an increasing trend in every year instead of 2009.It means the profit available for share holders has been increasing from year to year. It is a good sign for the company because it will boost to the investors to invest their surplus money as they will get a good return. It also shows the efficiency of the company and the firms ability to meet future adverse economic condition competition etc.but now face competition so net profit is low. like low demand, price

ROI Ratio
40 35 30 25 20 15 10 5 0 2008 2009 2010 2011

This ratio indicates that on the year when company issue new share ,the return on net worth decreases on that year compare to previous year except the period 2008.but still it is more than 25% every year which is more than other investment . It shows the growth and prosperity in the companys profitability and efficiency . As the return is more than 25%, it will attract more investor to invest their money in the company which will increase the market price of share .

XLVIII

Chapter- 4 Conclusion & Suggestions

XLIX

Finding:

According to my survey and calculating the important points are :

Financial position of ARSS is much good . There has been increasing in contract revenue and net profit after tax from year to year . The personal expenses has been increasing from year to year which indicates company is recruiting more employees for new project and paying good salary employees . The company is using more out side liability than own. From 2007-08 on wards company is paying dividend every year. Investors are more interested to invest in ARSS. Trend analysis reveals that there has been an increasing in net profit after tax during 2009-10 of 2764% and contract revenue of 1656% compare to 2005-06 which indicates better profitable position of the company and efficiency of management .

The recession period (2007-08) has not affected the growth of the company . During that period company has increased 136% in contract revenue . In 2009-10 out of total fund , owners fund is 34% where as outsiders fund is 66%. Liquidity position of the company is very good . In future it will not face any liquidity problem. Company is paying interest on borrowing funds regularly , so it will not face any problem for short term and long term borrowings . The earning per share has been increasing from year to year. Company is maintaining more inventory as stock . The competitor analysis reveals that net profit and return on net worth of ARSS is more than its competitor.

L Growth prospects of ARSS Within a short span, ARSS emerged as one of the leading Infrastructure developer not only in the Eastern India but also in Southern and North-Western India spreading over in 14 States and executing projects with outstanding quality, reliability, affordability, eco-friendliness and efficient services. ARSS is operating in a competitive market but the credential, capability and decades of experience in construction sector sets it apart from its competitors. Today the organization is one of the leading Civil Engineering Construction Company in Eastern, Southern and North-Western India. Its credentials are reflected in its project portfolio diverse and successful. The company possesses special expertise in constructing Bridges, Rail Roads, and Highways & Flyovers and has a strong presence in all the major construction activities.

The sources of funds of ARSS company has been increased in 2009-10 to Rs

7969969779 compare to other years due to increase of share capital, reserve and surplus &
loan funds.

The amount of total fixed assets has been increased in 2009-10 due to purchase of more
fixed assets & investments.

The overall financial position of the company is satisfactory. Profit after tax also increases due to increase in contract revenue and other income. The overall profitability of the company is good. There was net cash inflow form operating activities in the year 2009-10 due to receipt of
trade and other receivables compared to other years where cash out flow was more.

Net cash used in investing activities from 2005-06 to 2009-10 has increased and in 2009-10 it
has near to double than 2008-09 due to purchase of fixed assets and investment in outside.

Net cash from financing activities has increased in 2009-10 of 2716362840 due to issue of share. There has been an increase in net cash & cash equivalent for the year 2009-10.The closing
balance for the year 2009 -10 was Rs 1095090537

The over all cash position of the company is sound.

LI

Suggestion :
The study has provided with the useful data from the respondents .There has a lot to recommended .Following are the recommendations :

The Company is handling projects like roadwork, railway work, bridge work, airport, & power system etc, so now it can also explore to other sectors like commercial mall, building and residential houses and apartment etc.

The main objectives of the company are to maximize its profits and minimize its costs by giving better service to its clients. So it has to explore new market by creating new and more joint ventures.

There should be increase in investment of ARSS. So that could be earned more profit . Because , if investment will be high than profit will be earned high . There should be improved the completion process of project of ARSS . Because completion process of project of ARSS is take more time . There should be good coordination in departments of ARSS . If coordination will have good in department , then there will not has to face any problem in proper work . Time to time ,there should be provided training of employee .So that they could take information about the new technology of them proper working process . There should be good communication between each department of ARSS .

Company should reduce the inventory holding period with use of zero inventory concepts

The overall profitability position of the company is good and it should try to maintain it. The cash position of the company is sound, the company should maintain it and as well as try to declare dividend to its shareholders from time to time. As the company has a satisfactory financial position and planning for more growth and diversification, it should try to maintain it financial position. Company should diversify its business towards construction of building in city like Bhubaneswar Company should issue debenture

The infrastructure industry globally has witnessed tremendous growth in the past few years. A significant part of the global engineering construction activity is concentrated in the oil and gas industry, the power sector, roads construction and is dominated by few industry majors. In this journey of growth ARSSS Construction activity is integral part to the industrial development and involves construction of urban infrastructure, townships, highways, bridges, railroads, river valleys and power connected projects.

LII

LIMITATIONS OF THE STUDY

1. Limitation of time. 2. All relevant data were not available. 3. Certain information was kept confidential by ARSS Infrastructure Projects Ltd managed on the ground of confidentiality. 4. Extensive analysis could not be made due to limited source of funds. Inspite of all these difficulties, the Researcher has tried his best collect all relevant data or information to make his study successful.

LIII

CONCLUSION
Growth prospects of ARSS Within a short span, ARSS emerged as one of the leading Infrastructure developer not only in the Eastern India but also in Southern and North-Western India spreading over in 14 States and executing projects with outstanding quality, reliability, affordability, ecofriendliness and efficient services. ARSS is operating in a competitive market but the credential, capability and decades of experience in construction sector sets it apart from its competitors. Today the organization is one of the leading Civil Engineering Construction Company in Eastern, Southern and North-Western India. Its credentials are reflected in its project portfolio diverse and successful. The company possesses special expertise in constructing Bridges, Rail Roads, and Highways & Flyovers and has a strong presence in all the major construction activities.

The sources of funds of ARSS company has been increased in 2008-09 to Rs

3,770,395,572 compare to other years due to increase of share capital, reserve and surplus & loan funds.

The amount of total fixed assets has been increased in 2008-09 due to purchase of
more fixed assets & investments.

The overall financial position of the company is satisfactory. Profit after tax also increases due to increase in contract revenue and other income. The overall profitability of the company is good.

LIV

Chapter-5

Appendix

LV

Balance sheet as on 31 march

Particular March 31, 2011 Sources of Fund Shareholders Fund Share capital 148432300 Reserve and 4335636664 Surplus Loan Funds Secured Loan 9298977607 Unsecured 99156117 Loan Deferred 216143050 Tax liability Total 14098345738 Application of Funds Fixed Assets Gross block 5314901427 Less 575070355 depreciation Net block 4739831072 Investment 361851873 Current Assets Inventory 7770988128 Sundry 712240249 debtors Cash & bank 1507751636 balances Loans & 2186134506 advances Total 12177114518 Current Liability Current 2912507815 Liability Provision 319563986 Total 3232071801 Net Current 8945042718 Assets Mis. Expenditure Total 51620074 March 2010 31, March 2009 31, March 2008 31, March 2007 31, 148432300 3231235827 125540000 1357973976 125540000 871796456
107960500 185931512

st

4457664482 12226366 120410804 7969969779

2182193801 41061473 63626322 3770395572

975277469 10000000 26449497 2009063422

378665727

13818588 686376327

2879051806 295311305 2583740501 34440872 3701088128 786122901 1095090537 1406480937 6988782503 1447454152 258380043 1705834195 5282948308

1626196379 159993168 1466203211 38212921 1882704940 428533465 717214943 557410278 3585863626 1147928616 172295570 1320224186 2265639440

864347716 86827072 7775226445 25436921 622103160 653574370 373999265 506967157 2156643952 858935086 92135010 951070096 1205573856

315145682 47323666 267822016 18256201 73298835 145136306 116425792 205984507 540845439 105763831 35261598 141025429 399820010

68840098

340000

530000

478100

14098345738

7969969779

3770395572

2009063422

686376327

LVI

Income statement as on 31st march

Particular Income Contract revenue Other income Total Expenditure Direct contract expenses Personal expenses Administrative expenses Selling expenses Interest & financial charges Depreciation Total Profit before tax Less tax Income tax Current year Previous year Deferred tax Fringe benefit tax Profit after tax Balance brought previous year Amount available appropriation March 2011 31st, March 2010 31st March 2009 31st March 31st 2008 3136709419 29233380 3165942799

12490111161 84548510 12574659671

10065504283 65350851 10130855134

6243752255 38660829 6282413084

8915457251 419228525 263421011 184312599 990312007 282231209 11054962602 1519697069

7625408085 262364862 172315888 193751628 530739775 135423261 8920003499 1210851636

4892335677 140461371 97277799 102739612 270174025 73487946 5576476430 705936654

2530581376 29828204 50703745 42761762 94163206 39501406 2787539699 378403100

302312813 95732246

253334829 56784482 900732325 863418722

154925326 10286739 37176825 2682692 500865072 402284456

90860620 2658184 12630909 1274389 270978998 149131512

1121652010 from 1699732913

for 2821384923

1764151947

903149528

420110510

Appropriation Dividend Tax on dividend Transfer to general reserve Profit carried forward Earnings per share Face value ( Rs 10) Basic Diluted

14843230 2407943 14843230 2789290520

29686460 5045214 29686460 1699732913

12554000 2133552 25043254 863418722

12554000 2133552 3138500 402284458

75. 57 75. 57

70.48 70.48

39.90 39.90

23.77 23.77

LVII

Chapter-6
Bibliography

Bibliography :

LVIII

Management Accounting Sashi K Gupta & R K Sharma Financial Management I M Pandey Referaneses www.arss.co.in www.google.com www.money control .com www. Business standar.co.in Annual Report of ARSS 2007-06 to 2010-11 Departmental records