AIL by Ajab Khan

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Chapter 1 Introduction to the Report This report is about the internship in Associated Industry Limited
Amangarh Noweshra. Internship is an integral part for all business management students at Comsats
Abbottabad. The students are required to spend minimum six weeks time period in an organization in order
to get first-hand knowledge of real life situation. 1.1 Objectives of Study The primary purpose of the
internship is to fulfill the academic requirement of BS (BA) program and to bridge the gap between theoretical
knowledge and the practices being done in the field of finance. Besides this, some other purpose are
associated with, which includes: ? To get firsthand knowledge of practices being done. ? To analyze national
bank organization, financial and other aspects. ? To apply the knowledge gained in practical field. 1.2
Limitation of the Study Due to the narrow time span six weeks it is not possible to cover each area of the
bank for the purpose of study. Internship students are not allowed to retrieve and use any confidential
material for any purpose, as it is against the bank policy. This study was conducted in accordance with the
objectives of the study. The study may not include broad explanation of facts and figures due to the nature of
the study. The problem of short time period also makes the restricted as one cannot properly understand and
thus analyze all the operation of a bank. 1.3 Merits of the Report The report will benefit the finance students
because the following chapters of this report encompass most of the aspects of organization, followed by
SWOT analysis, conclusion and recommendation, furthermore, AIL Noweshra may also benefit from the
recommendation made at the end of the report. 1.4 Methodology of the Study The report is based on my six
weeks internship program in Associated Industry Limited. The methodology reported for collection of data is
primary as well as secondary data. 1.4.1 Primary Data My primary sources for data collection include; ?
Interviews and discussion with staff members 1.4.2 Secondary Data My secondary sources for data
collection include; Annual Reports (2011-13) ? Internship Reports. ? Website of AIL Chapter 2 Introduction
to Associated Industries Limited 2.1 Historical Background of the Company Associated Industries Limited
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(AIL), a ghee-manufacturing unit, was established in 1960 in Noweshra in a fairly large plant area with its
adjoining residential colony. The building is designed by the famous firm of John Tarry & Block, in
consultation with Fried Krupp Heb of Germany who are the main suppliers of machinery as well. Present
market share of Shama in KPK (Pakistan) is 40-45%. Right from the inception of production in 1963, the
brand Shama became an instant hit and market leader. The subsequent period witnessed the continuous
lead with phenomenal growth in production from 10,000 tons to 50,000 tons. 2.2 Nature of the Organization
AIL, manufacturing ghee & cooking oil; have been proven in all Pakistan. SHAMA is reliable name, while
using its products, you can be sure that, before its product reach you, quality checks by world class
standards; (ISO 9001:2000, ISO 14001:2004 / & HACCP) are done, using the finest quality, raw materials
and cooking precessions. The reason for its success was its high standard of quality, assured by its
stringent quality assurance procedure. The financial successes & turnover have kept this Company in top 10
companies of Stock Exchange. In view of ever growing demand of SHAMA Brand, a number of imitators
have copied the color and design of its pack and monogram and entered the market. Nevertheless, our
brand loyal consumers have always been able to identify the real brand. We are also concentrating efforts
on increasing our soap production capacity. In the past, demand for our quality soap has far exceeded the
production. Apart from our Brand AIL 104/023 another quality with SHAMA Brand is being introduced. 2.3
Company Information 2.3.1 Company Management Sheikh Amjad Rasheed Chairman Sheikh Atif Rasheed
Sheikh Ahsan Rasheed Mr. Ishtiaq Khan Mr. Sheikh Naeem Nadeem Mr. Sarwar Sheikh Mr. Zia-ud-Din Mr.
Imran Saeed Mr. Zia-ud-Din Mr. Imtiaz Afridi Mr. Niaz Muhammad Mr. Karam Dad Feroz-ud-Din Mr. Tariq
Hameed Mr. Mian Iqbal Mr. Karam Dad Mr. Irfan Tahir Mr. Jawad Khan Vice Chairman Director/CEO
Executive Director Resident Director General Manager Assistant General Manager Senior Manager Sales
Senior Manager Accounts Senior Manager Purchase Senior Manager Production Senior Manager Quality
Control Senior Manager Market Development Senior Manager Marketing Senior Manager Human resource
Senior Manager Soap General Manager Finance Assistant Manager Market Development 2.4 Vision and
Mission Statements 2.4.1 The Vision Statement We want to make a chain from producer to consumer and
make our product of highest quality and affordable to our customers. For us our customers take precedence
& we take no chances with their health & satisfaction. We ensure safe, high quality products for our
customers by being quality conscious and consistently improving our quality systems of distributors,
retailers, outlets & direct sales. 2.4.2 The Mission Statement We believe in "stepping forward" into the
future, striving to offer Quality of products within the food industry that will change the status quo. Our
expertise in manufacturing ghee & cooking oil, have been proven in all Pakistan. You know that, when you
are using our brands, you will get the best of everything; (Taste, Quality and nice packing) . 4 2.4.3 Quality
Policy Statement We will spare no effort and expense to ensure that all our valued consumers get the best
available quality products. 2.4.3.1 Quality Control & Quality Assurance Quality checks at every stage of
production starting from Raw Material, Ghee & Cooking Oil, Processing and Packing etc. Are strictly
followed by our separate quality control departments to get best quality end products. At every stage of
manufacturing the customer's requirements are confirmed according to the ISO Standards, (Quality,
Environmental, and Food Safety) and inline Chemist inspect each-and-every process and step. The Chemist
makes sure that only good products move to the next stage. Through effective implementation of quality,
environmental, food safety program, HGGM has been able to develop and produce best brands for
customers satisfaction.HGGM achieved this International Standard ISO 9002 to enhance the customers
satisfaction by improving the quality of products and improvement in the manufacturing process. 2.4.3.2
Quality Management System (ISO 9001:2000) This International Standard promotes the adoption of a
process approach when developing, implementing and improving the effectiveness of a quality management
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system, to enhance customer satisfaction by meeting customer requirements. SO 9001:2000 Quality
Management System focuses on quality improvements in products, services and process by meeting the
customers requirements with the aim of continual improvementISO 14001:1996 & 14001:2004
(Environmental Management System Requirement with Guidance for Use). HGGM achieved this
International Standard to enhance the overall performance of environmental activities. This International
Standard covering environmental management are intended to provide organization with the elements of an
effective environmental management system (EMS) that can be integrated with other management
requirements and help organization achieve environmental and economic goals. 2.4.3.3 HACCP (Food
Safety Management System) HGGM is the first HACCP certified ghee & cooking oil manufacturing unit in
Pakistan. HACCP provides the food safety guidelines at overall stages of goods manufacturing, handling,
and storage. 2.5 Product Lines A product line is a group of products that are closely related because they
perform a similar function, are sold to the same customer group, are marketed through same channels, or
make up a particular price range.AIL is producing ghee & cooking oil in different packs. 2.6 Organizational
Structure Chairman Executive Director Resident Director General Manager Senior Manager Assistant
Manager Sales Accounts Purchase Production Quality Soap Marketing Human Resource 2.7 Strategies
2.7.1 Marketing Operations During the internship period in marketing department, I have observed that
marketing department has performed all the activities, which are necessary for the marketing process. In
marketing operations, marketing department customers inquiries are received from, telex, fax, E-mails, and
letters. They are directly sent to senior marketing manager for approval. The operations of the marketing
department are as follows: ? To improve the efficiency and productivity of marketing department. ? To
develop focus of sales team on cooking oil. ? To improve the sales of pouch packs. ? Shifting the advertising
strategy from conventional to modern advertising to develop a new consumer base. ? To improve the
visibility of brand in market place. ? To improve depth and width of our stock in market. ? Analyzing the trend
of the market. ? Analyzing the competitions movement of marketing. ? Analyzing the customer demand. ?
Analyzing the product development process. ? Analyzing the quality assurance process. ? Enhance the
market share as compare to competitors. ? Focus on the international market, not only the local market.
2.7.2 Marketing strategy Marketing strategy of AIL includes the following points: ? Covering the target
market. ? Better quality products through ISO 9001:2000, ISO 14001:2004 / & HACCP, standards. ? ? ? ?
Maintaining the strong market position. Goods are to be produce according to the requirements of
customers. Satisfied the customer from all aspects. To produce products having Taste, Quality and nice
packing. Major objectives The major objective of AIL is to capture maximum market shares and satisfied
their customers up to their requirements. Satisfaction The customer satisfaction is a strategic, if the
customers are satisfied with the services of a firm and what they are getting from the firm, they will definite
loyal with the company and always became representative of the company. Monitoring AIL has assigned
some executives to monitor the not only their market, also monitor the competitors products and services
existing in the market. If competitors facilitate his customer as compare to us then try to adopt those
strategies for better results. Because this is an era of competitions and if they do not compete with other in
the market, they cannot keep their position in the market. AIL is trying their best by offering a variety of high
quality products and services to their customers. 2.7.3 Pricing Strategy Price Pricing is the amount of
money or other items which utility needed to acquire a product. Price has a significant role in the marketing
activities of the firm as well as, the willingness or acceptance of the customers, whenever a firm decides
about the pricing of its products it must have some objectives behind rechecking again. These objectives
may be: ? Profit oriented (increase the profit margin) ? Sales oriented (profit making through increase the
sale) Pricing policies/strategies procedure of AIL AIL is offering the price on the basis of three strategies,
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which are as follows: ? Competitive base ? Customer base ? Product base Pricing is an important factor in
the marketing process for any company. The pricing policy of the company should be in such a way that it
should produce a reasonable profit, for the company and satisfy the customer while calculating the price of
any company. Since two factors are very important: ? Fixed cost ? Variable cost Fixed cost It is the cost
that remains always same whether produced large quantity or low quantity is. So companies always try to
use their full capacity of production because with increase in production the fixed cost will be decreased.
Following are important factors of fixed cost: ? Overhead cost ? Salaries of staff Variable cost It is the
cost where per unit variable cost rises as the quantity decrease, Following are included in the variable cost:
? Cost of raw material ? Transportation Price fixing strategies AIL sells directly to their customer at their
doorstep, and then price components are as follows: Fixed cost + variable cost + desired profit = price of
the product The profit margin depends upon the condition of the market. If market will be new, the price will
be also new to attract the customers and compete with existing competitions. The pricing policies of AIL
vary from product to product and also vary from local and international market. Sometimes price also vary
from province to province. Over all AIL has flexible price for his entire customer to capture maximum market
shares 2.7.4 Distribution strategy Distribution Distribution is very important activity of marketing without
distribution there is no concept of product and producer. Market channels are the set of the interdependent
organization involved in the process of marketing a product or services available for the use or consumption.
Here strategies involved the management of the channels by which ownership of the product is transferred
from producer to customer and in many cases the system by which the goods are moved from producer and
purchased directly by final customers. Distribution strategy As AIL is producing an industrial product and
having a name of market leader in the market of ghee and cooking oil. Even before a product is ready for
market, the management of the company determines which methods and route will be used to get it, theyre
at customer end. This requires establishing strategies for the products distribution channels and physical
distribution. Managing a distribution channel often begins with a producer. AIL having its own direct
distribution system. Company is responsible to deliver the product to doorstep of the customer. Company
has their own transport through trucking. Company has their own go down based in factory for local and
export purpose. If customer found any defective material, companys sales executive lifts that material and
credit note to the customer, no middleman involved in all of this process. Company has their own distribution
setup for export in Afghanistan. 2.7.5 Promotional strategy Promotion as an element the organization
marketing mix that serves to inform, persuade, and remind the market of a product and or the organization
selling it in hope of influencing in the recipients feeding, beliefs or behavior. Method of promotion Following
are major methods of promotion: ? Personal selling ? Advertising ? Sales promotion ? Public relation ?
Publicity Promotional strategy of AIL Ghee & cooking oil is an edible product; AIL is using push strategy for
local and international customers. ? Company has their own published brochures for all of their products,
which helps customer to get the complete awareness and properties of the product. ? AIL also has their own
web site open for all customers and other concerned, where all of the information are present relevant to
company and product too. ? Field officers also keep in contact with all of the customers of his area and give
presentation about each product during his weekly/monthly visits, and also facilitate customers via E-mail,
telex and fax which is very helpful for resolving the problem at customer end. Company have arranged for
the advertising of his product in the business and chamber of commerce magazines, print and electronic
media. ? Every person of marketing has very good relationship with their customers, this PR resulting
enhancing the market share of company. Promotion of the product Company has their polices to promote
their products in local and international market. ? The management has a bird eye view on all environments,
which affects the products. ? They are exploring their market as a dynamic roll in flexible packaging. ? They
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are promoting technology as compare to previous years and competition point of view with the strong
position in the market. ? Company is changing its polices as per economic situation of the market and social
trends. 2.8 Finance Strategies ? Maintain company finance operations within the resources. ? Maintain
working capital keeping stock debtors low. ? Tax management to gain legitimate advantages lessening the
burden ? Ensure internal control through internal audit ? Ensure sales revenue generation meet targets ?
Maintenance of purchasing function 2.9 Human Resource Strategies ? Managing employee recruitment and
placement to put the right person for the right place. ? Replacement Planning. ? Employee rotation in the
department. ? Employee training. Chapter 3 Inside the AIL Pakistan Learning as an Intern in AIL 3.1 Main
Responsibilities Main responsibilities during the whole period of internship are to maintain and keep updated
financial record of Finance Share Services department under the supervision of Mr. Irfan Tahir. Following are
the main responsibilities Dealing indirect payment Dealing with Advertisement and promotion activities
Issues of direct payment 3.2 Products: 3.2.1 Ghee ? Available in Assorted Tin and Plastic Pouch Packaging
3.2.2 Cooking Oil ? Available in Assorted Tin and Plastic Pouch Packaging 3.2.3 Types of Brand Shama
ghee & cooking oil (NSB, ISB) Hafeez ghee CSD ghee & cooking oil Utility Ghee & cooking oil Shama puff
(Industrial margarine)Crude oil (sunflower, canola) Shama soap. 3.3 AIL
2Principles Strong businesses are built on the principles of Trust,
Accountability and an Environment that allows their people to reach their
full potential. At HGGM live by the following principles when conducting
our day to day work. Integrity We act with honesty, integrity and highest
ethical standards. We adhere to the laws and regulations pertaining to our
work and with HGGM principles and policies. ? Fairness We work with
people in a way which is fair and appropriate. We treat fairly our
customers, suppliers, shareholders and the communities in which we live
and work. ? Trust People can trust us to fulfill our commitments. At the
same time we also trust others to be true to their commitments to us. ?
Accountability Along with trust comes accountability we believe all of us
are uniquely created with the ability to reason, make decisions and be
held accountable for our commitments and actions. We hold ourselves
accountable for fulfilling our responsibilities and commitments. ? People
reaching their full potential Each one of us is creative, thoughtful,
trustworthy, fair, capable of making important decisions and responsible
for our actions; however we believe each one of us is also different and
has unique potential and talents to make positive contribution to the
organization and the world.
? Production Department Health is a serious issue and HGGM taking seriously this matter their products are
manufactured under quality control & food safety standard guidelines and always ensures the food safety
through hygiene and safety measures. We at HGGM have the ghee & cooking oil manufacturing facility with
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advance technology and using by latest techniques. 3.4 Technology used in AIL ? Vacuum distillation
technology 3.4.1 Production Capacity 150 metric ton 3.5Ghee making Process 3.5.1 Oil use for making
ghee ? Palm oil ? Refined Bleached and deodorized ? Cotton seed 3.5.2 Pre- Neutralization ? Reaction
edible oil with caustic soda causes production of soap contents, which removed by water washing edible oil
soap stock so removed by batch process ? Temperature is 40 to 50 0C ? In this process time consumed 1
hour or 1.5 hour 3.5.3 Pre- Bleacher ? oil heated 80 or 100 0C for moisture remove ? Fuller earth use for
reduced color ? At the end of bleaching process the oil is filtered in filter press to remove the spent
bleaching earth ? In this process time consumed 1 or 2 hour 3.5.4 Hydrogenation ? Oil heated with steam in
coils 200 or 230 0C ? Nickel catalyst fed into process ? Hydrogen gas passed in that process ? When its
melting point (36 2 0C) than stop hydrogen pass process ? Then the hydrogenated nickel catalyst mixed oil
is first cooled from 200 0C and then it is filtered through a filter press. ? Time consumed 4 hour 3.5.5 Post-
Neutralization ? Hard and soft oil mix according to required quantity to reduce FFA through caustic soda ?
Temperature 60 or 65 0C ? Time consumed 1.5 hour 3.5.6 Post- Bleacher ? In this process decrease the
color of oil with the help of fuller earth. ? Temperature 60 or 65 0C ? Time consumed 1.5 hour 3.5.7
Deodorization: ? Remove smell of oil ? Oil heated 3 to 4 hour at 200 to 230 0C under high vacuum by
injecting open steam ? Smell and specified matter, moisture unspecified matter and gum completely removed
? In this process citric acid also used ? After this process oil cooled and than it finally filtered ? Idle color
should be less than 4.0 3.6 Cooking oil Process 3.6.1 Pre- Neutralization ? Removal FFA ? Reaction edible
oil with caustic soda causes production of soap contents Which removed by water washing edible oil soap
stock so removed by batch process ? Temperature is 40 to 50 0C ? In this process time consumed 1 hour or
1.5 hour 3.6.2 Pre- Bleacher ? Oil heated 80 to 100 0C for moisture remove ? Fuller earth use for reduced
color ? At the end of bleaching process the oil is filtered in filter press to remove the spent bleaching earth ?
In this process time consumed 1 or 2 hour 3.6.3 Deodorization: ? Remove smell of oil ? Oil heated 3 to 4
hour at 200 to 230 0C under high vacuum by injecting open steam ? Smell and specified matter, moisture
unspecified matter and gum completely removed ? In this process citric acid also used ? After this process
oil cooled and then it finally filtered ? Idle color should be less than 2.0 3.7 Soap After the process of
Pre/Post neutralization the soapy oil is drained from vessel and takes for manufacturing of soap. In soap
section mix the silicon, sodium hydroxide, soap stone and water into soapy oil and then heated and mix and
boil. After this we take the soap into the boxes, and after this soap are ready for cutting and packing Soap.
After the process of Pre/Post neutralization the soapy oil is drained from vessel and takes for manufacturing
of soap. In soap section mix the silicon, sodium hydroxide, soap stone and water into soapy oil and then
heated and mix and boil. After this we take the soap into the boxes, and after this soap are ready for cutting
and packing. Chapter 4 Analysis of Associated Industry Limited 4.1 Financial
1analysis Financial analysis is a process which involves reclassification
and summarization of information through the establishment of ratios and
trends. Financial statement analysis is the process of examining
relationships among financial statement elements and making
comparisons with relevant information. It is a valuable tool used by
investors and creditors, financial analysts, and others in their decision-
making processes related to stocks, bonds, and other financial
instruments. The goal in analyzing financial statements is to assess past
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performance and current financial position and to make predictions about
the future performance of a company. Investors who buy stock are
primarily interested in a company's profitability and their prospects for
earning a return on their investment by receiving dividends and/or
increasing the market value of their stock holdings. Creditors and
investors who buy debt securities, such as bonds, are more interested in
liquidity and solvency: the company's short-and long-run ability to pay its
debts. Financial analysts, who frequently specialize in following certain
industries, routinely assess the profitability, liquidity, and solvency of
companies in order to make recommendations about the purchase or sale
of securities, such as stocks and bonds. The analysis of financial
statement refers to the examination of the statements for the purpose of
acquiring additional information regarding the activities of the business.
The users of the financial information often find analysis desirable for the
interpretation of the firms activities. The overall objective of financial
statement analysis is the examination of a firms financial position and
returns in relation to risk. This must be done with a view to forecasting
the firms future prospective. Analysts can obtain useful information by
comparing a company's most recent financial statements with its results
in previous years and with the results of other companies in the same
industry. Three primary types of financial statement analysis are commonly
known as horizontal analysis, vertical analysis, and ratio analysis.
4.2 Common Size Analysis Common-size analysis expresses comparisons in percentage. The use of
percentages is usually preferable to the use of absolute amounts. Common size analysis can give analyst
valuable approaching into changes that have occurred in a firms financial condition and performance. As
common size analysis gives us relative percentage of an item with respect to total, so the growth or decline
in various items of balance sheet and income statement cannot be detected from common size percentages.
It has the following types: ? Horizontal Analysis ? Vertical Analysis 4.2.1 Horizontal
3Analysis This technique is also known as comparative analysis. It is
conducted by setting consecutive balance sheet, income statement or
statement of cash flow side-by-side and reviewing changes in individual
categories on a year-to-year or multiyear basis. The most important item
revealed by comparative financial statement analysis is trend. A
comparison of statements over several years reveals direction, speed and
extent of a trend(s). The horizontal financial statements analysis is done
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by restating amount of each item or group of items as a percentage. Such
percentages are calculated by selecting a base year and assign a weight
of 100 to the amount of each item in the base year statement. Thereafter,
the amounts of similar items or groups of items in prior or subsequent
financial statements are expressed as a percentage of the base year
amount. The resulting figures are called index numbers or trend ratios.
Formula = Current Year amount / Base Year amount * 100 Horizontal analysis, whilst simple to execute and
useful to a certain extent, has its limitations. These limitations include: ? Being highly dependent on the
selection of base year and the period under examination in the financial model. ? Horizontal analysis
provides little insight into why the trend occurred in a financial model. ? Horizontal analysis does not provide
insight into whether the trend in the financial model results was superior/inferior to some benchmark. 4.2.1.1
Horizontal Analysis of Balance Sheet Table 4.1 ASSETS 2013(%) 2012(%) 2011(%) Property, Plant and
Equipment 101.89 103.84 100 Long term Investment 119.04 - 100 Stores and Spares 113.01 99.28 100
Stock in Trade 212.98 124.26 100 Trade Debts 171.06 114.88 100 Loan, Advances and other Receivable
26.10 90.26 100 Trade Deposits, Prepayment 227.40 114.176 100 Other Receivables 119.33 100 Accrued
Income on Financial Assets 24.58 93.64 100 Cash and Bank balance 72.02 88.54 100 Liabilities 2013%
2012% 2011% Trade and other Payable 136.69 114.01 100 Issued, Subscribed and Paid up Capital 100
100 100 Revenue Reserve 100 100 100 Un-appropriated Profits 148.09 91.32 100 Surplus on Revelation
of Property Plant and Equipment 94.90 98.02 100 Long term Deposits 132.63 99.29 100 4.2.2 Vertical
Analysis When using vertical analysis, the analyst calculates each item on a single financial statement as a
percentage of a total. The term vertical analysis applies because each year's figures are listed vertically on
a financial statement. The total used by the analyst on the income statement is net sales revenue, while on
the balance sheet it is total assets. This approach to financial statement analysis, also known as component
percentages, produces common-size financial statements. Common-size balance sheets and income
statements can be more easily compared, whether across the years for a single company or across
different companies. Vertical analysis is a technique for identifying relationship between items in the same
financial statement by expressing all amounts as the percentage of the total amount taken as 100. In a
balance sheet, for example, cash and other assets are shown as a percentage of the total assets and, in an
income statement, each expense is shown as a percentage of the sales revenue. In Vertical analysis,
various components of the financial statements are standardized by expressing them as a percentage of
some bases. Examples of common-sized statements include: ? Components of the balance sheet expressed
as a percentage of total assets ? Components of the
3income statement expressed as a percentage of sales
or revenue 4.2.2.1 Vertical Analysis of Balance Sheet Table 4.3 ASSETS 2013(%) 2012(%) 2011(%)
Property, Plant and Equipment 24.86 38.73 24.82 Long term Investment 5.33 - 7.01 Stores and Spare 0.203
0.27 0.28 Stock in Trade 29.30 26.12 21.51 Stock Debt 24.13 24.77 22.06 Loan, Advance and other
Receivable 0.89 4.71 5.34 Trade Deposits 8.76 6.72 6.02 Total 100 100 100 LIABILITIES 2013 2012 2011
Trade and other Payable 8.25 10.52 9.44 Issued, Subscribed and paid up Capital 4.26 6.51 6.67 Revenue
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Reserve 4.42 6.75 6.91 Un-appropriated Profits 10.33 9.73 10.91 Surplus on Revelation of Property, Plant
and Equipment 18.04 28.48 29.72 Long term Deposits 0.46 0.53 0.55 Total Liabilities 100 100 100 4.2.2.2
Vertical Analysis of Income Statement Table 4.4 2013(%) 2012(%) 2011(%) Sales 100 100 100 Cost of
Good Sold 94.04 94.15 86.68 Gross Profit 5.94 5.84 8.22 General and Administrative 1.61 1.67 2.33
Selling and Distribution 1.26 1.33 1.81 Operating Profit 3.07 2.83 2.64 Other Income 0.14 0.24 0.43
Financial Expenses 1.13 0.76 0.78 Worker Welfare fund 0.039 0.044 0.062 Profit before Taxation 1.94 2.16
3.04 Taxation current 0.99 0.99 0.99 Profit after Taxation 0.94 1.16 1.53 Earning per Share 7.90 8.11 10.31
4.3 Ratios Table 4.5 2013 2012 Current Ratio 1.11 1.27 Net Profit Ratio 3.07 2.83 Gross Profit Ratio 5.95
5.84 The Current Ratio show that current liabilities in 2013 are much lowers a compare to 2012. In 2013
current ratio was 1.11 but it was higher in 2012 at time ratio was 1.27. Profit from sales also increase in
2013 as compare to 2012. In 2013 it was 3.07 which are higher because in the same period in 2012 it was
only 2.83 which have not a big difference. Gross Profit from sales also increases in 2013 as compare to
2012. In 2013 it was 5.95 which is higher because in the same period in 2012 it was only 5.84 which have a
slightly low difference. 4.3 SWOT Analysis 4.3.1 Strengths of AIL ? Brad Shama has been the single selling
brand in the KPK and Afghanistan. ? Shama five time awarded with ISO standard includes: quality,
environmental and food safety. ? Enjoying Economies of scale ? Strong distribution channel in Kpk. 4.3.2
Weaknesses of AIL ? Shama is a very old brand; there has been no change in packaging since age. People
feel that the new better packaged brand has better products. ? The brand suffers with an image problem in
the market. ? Consumers are bored with the brand, no innovative packaging of the product since 1994. ?
Success ratio is slow. 4.3.3 Opportunities of AIL ? The company can cash on sham to introduce new
products; they have a large market share in the central and northern areas of Pakistan. ? People in the
metropolitan areas are inclined towards branded products ? People are becoming health conscious and are
switching to brand offerings vitamin and cholesterol free attributes ? Shows emotional attachment as well as
health benefits ? The fat free banaspati is still popular and can be advertise to gain the market in health
conscious people. 4.3.4 Threats of AIL ? The market is now being entered by soya been canola and
sunflower oils, these are being brought by health conscious people; this will lead to Shama decline in market
share. ? The overall market of oil and banaspati is declining due to the fluctuation in the world oil prices. ?
Lately sunflower and canola based single oils have aggressively entered the market. ? Different types of
competitors are entered in the market with the passage of time. Chapter 5 Conclusion & Recommendation
5.1 Conclusions At present AIL is the most top organization in Pakistan production industry. It is one of the
best company accommodating more than 2000 employees. Present report is the requirement of the degree
program and as a finance student, I was conducted the three years financial analysis of the company. The
overall conclusion of the company are as follows: ? Best environment of marketing department. ? Strong
marketing policies. ? Imported machinery. ? Qualified and motivated staff. ? Strong market leader. ?
Awareness of products. ? Customer satisfaction procedure is very good. ? High financial resources. ? More
customers in International market. ? Fully computerized system of production. ? RD&C department is
working tirelessly. ? Every department is working with the standards of ISO 9001 and ISO 14001. ?
Research product and development procedure is very good. ? Marketing strategies are always made to
keep in mind the current market situation and competitors analysis. ? Marketing personnel continuous visit
to existing customer for getting new orders. 5.2 Recommendations On the basis of my studies and analysis,
following areas are recommended to improve the results of the organization. ? The company should arrange
the proper training program relevant to technical knowledge of product; this would improve the efficiency of
marketing department. ? Hired only those employees having technical or science background qualification
with MBA. ? Meeting should be arranged with production manager for discussion about complaints on
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monthly basis ? The company should focus the attention to customer services and proper complaint handling
to improve the company image in the market. ? The company should arrange the visit of marketing manager,
Regional manager for the covering, and studying of international market. ? Motive to customers to visit
factory for better knowledge of the product. ? The company should increase the staff of marketing
department for better results. ? Decision making power should be decentralized in each region. ? The
company should improve the communication process among the different departments for getting better
results. ? Appreciation and monetary regard is necessary on better performance of sales executives. ?
Marketing personnels should visit to factory premises for getting product information, so that they are fully
aware the products and its specifications. References For completing this project I have taken help from
following resources as references. a. Annual Report AIL (2011, 2012, 2013) ? ? 1 2 3 5 6 7 8 9 10 11 12 13
14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31
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