Report on:Report
A PROJECT SUBMITTED TO BHAVNAGAR UNIVERSITY OF BHAVNAGAR IN PRACTICAL FULFILMENT OF THE DEGREE OF BACHELOR OF BUSINESS ADMINISTARTION
PREPARED BY
GUIDED BY
DHAVAL K. DHRANGADHARIYA
Miss. DHRUTI PANDYA
S.Y B.B.A
LECTURER:- DHRUTI PANDYA
ROLL NO: 246
BATCH: 2008-2011
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C A N D I D A T E ’S S TA T E M E N T My
s el f
DHAVAL
K.
DHRANGADHARIYA,
th e
student of S.Y. B.B.A. here here by declare that the project work presented in this report is my own work and I have have comp comple lete ted d it it
unde under r the the guid guidan ance ce of
Miss Miss..
DHRUTI PANDYA of “SWAMI SAHJANAND COLLEGE OF COMMERCE & MANAGEMENT – BHAVNAGAR”.
BHAVNAGAR DATE:
SIGNATURE:
Full Name: DHAVAL K. DHRANGADHARIYA
Principal --------- ----
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PREFACE
B
havnagar havnagar University University has started started certificate certificate course in administrat administration ion called called B.B.A (Bachelor (Bachelor of Business Business Administration) Administration) for the purpose of
know knowlledge edge about bout busin usine ess. ss. So, So, I have tak taken the the indus ndustr tria iall tra trainin ining g of NAVBHARAT STEEL RE - ROLLING MILL and take the practical knowledge of business and as give us training in the company I have made report/project as per my knowledge.
Management studies are like a coin, which has two sides, one is theoretical knowledge and other is practical knowledge. A classroom teaching gives the theore theoretic tical al knowle knowledg dge e while while indust industrial rial traini training ng gives gives an opport opportuni unity ty to take take knowledge of practical aspects. In this era of globalization where every moment the world is moving one-step ahead, so for a management student practical knowledge has become a key to success.
According According to our syllabus syllabus prescribe prescribed d by BHAVNAGA BHAVNAGAR R UNIVERCIT UNIVERCITY, Y, I have finished my practical study. With a great zeal and gaiety, I put this report before you. I have presented information of four subjects according to S.Y.B.B.A. syllabus. This report is reflecting of which I understood and studied in this report and and how how I colle collect cted ed the the info inform rmat atio ion. n. I have have trie tried d my leve levell best best to pres presen entt information regarding NAVBHARAT STEEL RE - ROLLING MILL.
For this purpose I had visited “NAVBHARAT STEEL RE - ROLLING MILL” at Sihor, near Bhavnagar.
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ACKNOWLEDGEMENT
I
am very glad here to submit my project report. I have presented a report on STEEL RE-ROLLR MILL industry and I have put my best efforts to prepare it
in a realistic manner and include all necessary information, which can give a clear picture of STEEL RE-ROLLING industry management.
I am very thankful to all the senior executives and other staff members of NAVBHARAT STEEL RE - ROLLING MILL to give me very well support, cooperation and help me with whatever was needed in my project.
And how can I forget my respective principal Miss. Shilpamadam Bhatt and our projec projectt guide guiderr Miss. Miss. DHRUTI DHRUTI PANDY PANDYA A of “Swami “Swami Sahaj Sahajana anand nd Colleg College e of Commer Commerce ce and Manag Manageme ement” nt” to provid provide e us with with this this very very import important ant trainin training, g, which develops management skill in us.
I hope this report will give a realistic and clear picture of STEEL REROLLING industry management. Thanks once again to everyone who has directly or indirectly helped me through this training and prepare this report.
NAME:
DHRANGADHARIYA DHAVAL K.
CLASS:
S.Y.B.B.A.
ROLL NO: 246 (TWO FOUR SIX)
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Content SR NO.
1
2
3
4 5
PARTICULAR GENERAL INFORMATION HUMAN RESORCE MANAGEMENT MARKETING MANAGEMENT FINANCE MANAGEMENT BIBLIOGRAPHY
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PAGE NO
6
22
43
55 73
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Content SR.
PAGE PARTICULAR
No.
No.
1
INTRODUCTION
8
2
History And Development
9
3
Profile of the company
10
4
Size of the unit
11
5
Form of the organization
12
6
Manufacturing products
14
7
Manufacturing process
15
8
Organization structure
18
10
Time keeping system
20
11
Employee Service
21
INTRODUCTION
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I
have have comp comple lete ted d my indu indust stri rial al trai traini ning ng in NAVB NAVBHA HARA RAT T STEE STEEL L RE -ROLLINGS MILL for the practical knowledge as part of management and
general information of the industry, in that HUMAN RESORCE MANAGEMENT, MARKETING MANAGEMENT, FINANCE MANAGEMENT & BIBLIOGRAPHY. NAVABHARAT STEEL RE - ROLLING MILL has improved its goodwill by increasing quality of products. NAVBHARAT STEEL RE - ROLLINGS MILL is one of the fastest growing and Moving Consumer Goods (FMCG) & Over the Counter (OTC (OTC)) prod produc uctt manu manufa fact ctur urin ing g comp compan any y in mark market et.. It has has also also give given n toug tough h competition on local market as well as in state market. NAVBHARAT STEEL RE ROLLING MILL products are sold under highly competitive conditions. It offer handsome returns to their distributors & stockiest with grace. A Rolling Mill is a machine for factory shaping steel by passing it between ROLLING. This company’s product is used by infrastructure development and engineering unit which is initials above the development of any of the nation for economical development. So, it is clear that the unit have bright future. The company manufactures these products that are as under,
M.S.FLAT BAR
M.S.ANGLE BAR
M.S. ROUND BAR
M.S. SQUARE BAR
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HISTORY & DEVELOPMENT OF THE UNIT
N
AVBHARAT STEEL RE - ROLLING MILL Established in the year 1994 having the purpose to manufacturing various products of steel bars. The
production of the company has started with the help of single rolling mill is that with 7 stands with and also with well furnished.
Than Than,, in the the year year,, 1999 1999-2 -200 000 0 comp compan any y has has inst instal alle led d anot anothe herr set set of machinery with further develop with the production of M.S. Angle, M.S. Flat, Square and Round Bar and also produce various sizes bars like 6, 8, 10, 12, and 16. Initially production of the unit was 4000 increased capacity the company has got ISI mark and ISO 9001-2000 certificates.
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PROFILE OF THE COMPANY The NAVBHARA NAVBHARAT T STEEL STEEL RE ROLLIN ROLLING G MILL, MILL, the main & regist register er office is in Bhavnagar. This unit has not separate zonal office.
NAME
NAVBHARAT STEEL RE-ROLLING MILL SURVEY NO. 268/1
ADDRESS
RAJKOT- BHAVNAGAR HIGHWAY
FACTORY
SIHOR – 364 240 DIST. BHAVNAGAR (Guj.) 12, SAGARDEEP
ADDRESS OFFICE
LOKHAND BAZAR BHAVNAGAR. – 364001
MANAGING DIRECTOR PRODUCTION HEAD
BHAGIRATHSINH SARVAIYA
AJAYSINH
BANKER
STATE BANK OF SAURASTRA
PHONE NO.
(O)3014758,3014241 (W)(02846)223283
ACCOUNTING YEAR WEB SITE E-MAIL ADDRESS
1-APRIL TO 31-MARCH
WWW.NAVBHARATSTEELRE-ROLLING.ORG
[email protected]
COMPANY LOGO
QUALITY BECHMARK
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SIZE OF THE UNIT & FORM OF THE ORGANIZATION Size of the unit means, how much the investment of company and how much the turnover is. According to Indian government rules or say policy, this is recognizing by the government.
There are mainly 3 types (scale) of industries: industries:
1.
SMALL SCALE: -
Investment is up to Rs. 100lakh.
2.
MEDIUM SCALE: - Investment is between Rs. 100lakh - 150lakh.
3.
LARGE SCALE: -
Investment is more than Rs. 150lakh.
According to Indian government rules NAVBHARAT STEEL RE ROLLING MILL is small-scale industry, because the investment is more than Rs.100lakh.
SCALE
Small Scale Industry
Medium Scale Industry
Big or Large Scale Industry
Total investments up to Rs. 100 Lakh
Investment is Between Rs. 100 Lakh to 150 Lakh
Investment is more than 150 Lakh
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FORM OF ORGANISATION There are various types of organization structures are as under.
Sole Proprieto Proprietorship rship :- ‘‘Sole ‘‘Sole
propri proprieto etorsh rship ip
is
form form
of
busine business ss
organisation in which an Individual introduces his own capital. Uses his own skill and intelligence in the management of its affairs and is solely responsible for the results of its Operation.’’
Partnership:- The relation between people who has agreed to share profits of a Business carried on by all or any of them acting for all.
Joint Stock Company:- Legally the joint stock company is an artificial person created for Carrying of some business by an association of persons. It assets that a Company has a legal entity of its own in the sens sense e that that it has has powe powers rs and and Char Charac acte teris risti tics cs dete determ rmin ined ed by the the provisions of law and conversions of Law and a constitution framed in accordance with them.
Co-operative Organization :- Minimum 2 & Maximum 10
Government department( Public Enterprises) ::- Public undertaking that is directly under the control of the minister
Public Public Corporati Corporation on :- Public Public corpor corporati ation on is a form form of organi organizat zation ion especially established for public welfare.
Government Company:- Gov. Company is a company where in 51% of shares held by the Central Government and a State Government jointly.
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Form of organizations means whether the company is Sole Proprietor Firm or Part Partne ners rshi hip p Firm Firm.. Here Here NAVB NAVBHA HARA RAT T STEE STEEL L RE ROLL ROLLIN ING G MILL MILL is a Partnership Firm. The reason to choose the Partnership Firm is the investment; is not to be done by only the single person and also an idea is not of the one person.
According to Indian Partnership Act 1932, “When two or more persons make an Agreement to start a business business & share profits & loss of the business can stated as Partnership Firm.”
As NAVBHARAT STEEL RE ROLLING MILL is a Partnership Firm it produces so many products and it is not possible in Sole Proprietor Unit.
CHART
FORM
Sole Proprietorship
Only One Owner
Partnership
Co-Operative
Minimum 2 & Maximum 20
Minimum 2 & Maximum 10
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Private Limited Company
Public Sector Unit
Minimum 2 & Maximum 50
Minimum 2 & Maximum 100
MANUFACTURING PRODUCTS NAVBHARAT STEEL RE ROLLING MILL producing main four types of bars M.S. Angle, M.S. Flat, M.S. Square & M.S. Round bar this is in various size produced by the company.
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MANUFACTURING PROCESS
N
AVBHARAT STEEL RE - ROLLING MILL Pvt. Ltd. are produce so many products like M.S. Angle bar, M.S. Flat bar, M.S. Round bar & M.S.
Square bar etc… the process of manufacture steel by RE-ROLLING MILL is understand very deep and stage wise explain as below.
(1) Purchase Raw Material (2) Cut the plat
(3) Give hit at high temperature (4) Passing the rolling (5) Packing
(1) Purcha Purchasin sing g Raw Mater Material ials:s:The basic requirement is purchasing raw material for manufacturing the prod produc ucts ts.. The The basi basic c raw raw mate materi rial al is M.S. M.S. Bille Billets ts,, M.S. M.S. Ingo Ingots ts,, M.S. M.S. Bar Bar IS: 2830 is over basic raw material.
(2)
Cut Plates :Purchased raw materials have been cut in the required size and weight. If it
has not being cut in the fixed size then the out put of bar is not match to desired size if we are going to sale that product then no any value of it. Hence, in market accuracy of size of bar must be required.
(3)
Furnace Furn ace the Plates Pla tes :That
cut
plates
are
heated
up
to
the
required
temperature in chamber running by lignite coal. From the
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hot metal, that is easy to make bar by rolling. We can give easily shape to the bar from metal alloy.
(4)
Passing into Rolling :The hot metal is then entered into rolling stand where rolls are fitted according to the required size and type of the final product.
(5) (5) Packi acking ng :After passing passing through the six rolls which are fitted in the rolling rolling mill established accordingly we get the required size of final produ product. ct. After After that that final final produc productt has been prepar prepared ed as the workers take the weight and cut that bar in accurate size and weight, after that the workers are going to pack the product for selling to the retailer. They paint any of the colour at the bottom and tide up a strip of company looking like a tag to give attractive look. This is the marketing scheme.
Moreover it is note that this process is carried out under supervision of three experienced persons. The entire process is being repeated in the same time table.
This This proc proces ess s has has been been shown hown in the the char chart. t. So, So, this this can can be easi easily ly understood.
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CHART OF MANUFCTURING PROCESS PURCHASING RAW MATERIAL (M.S. Billets/ M.S. Ingots, M.S. Bars)
Breaking Plates in Required Size
Pieces of billets & Ingots heated in furnace at required temperature
Hot pieces of Metal entered in to rolling mill stand
After passing hot pieces of metal through rolling mill stand
For Achieving Final Product & Packing
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ORGANIZATION STRUCTURE
G
enerally, the organization structure mainly depends upon the size & the form of the company. The organization structure of NAVBHARAT STEEL
RE - ROLLIN ROLLING G Mill’s Mill’s organ organiza izatio tion n struct structure ure is very very good. good. The NAVBHA NAVBHARAT RAT STEEL RE ROLLING MILL Organization structure is divided into three levels.
Top level
Middle level
Lower level
ORGANISATION CHART
TOP LEVEL
MIDDLE LEVEL
BOTTOM LEVEL
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TOP LEVEL: LEVEL TOP LEVEL MANAGEMENT mainly consists of Board Of Director, Chief Executive, Managing Director Etc... They manage the whole business unit & take decision about right policy, business promotion, legal provision & all liabilities of a business unit. They also look after Human Resource Management, Marketing Management as well as Finance Management of company.
In NAVB NAVBHA HARA RAT T STEE STEEL L RE-R RE-ROL OLLI LING NG MILL MILL Comp Compan any y in Top Top Leve Levell Bhagirathsinh G. Sarvaiya. He is director of the company.
MIDDEL LEVEL: LEVEL MIDDLE LEVEL MANAGEMENT is the link between the Top Management & The Lower Management. It consists of function like production, sales account & personnel officers. They are experts of specific field and try to accomplish work by preparing programs for different section.
In
NAVBHARAT
STEEL
RE
ROLLING
MILL,
the
Middle
Level
Management consists of finance head, production head, and sales representative.
LOWER LEVEL: Gene Genera rall lly, y, BOTT BOTTOM OM LEVE LEVEL L MANA MANAGE GEME MENT NT of Jobb Jobber ers, s, Work Worker ers, s, Foreman etc...These people are important to the company as they are persons who produce the different products of the company, which the company producing on the Large Scale.
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In NAVBHARAT STEEL RE ROLLING MILL industry, the Bottom Level consists of many workers who take the guidelines from Middle Level, who is instructed by the Top Level. The following chart shows the organization structure of the company.
TIME KEEPING SYSTEM
Time keeping system is very important for each and every person organized for any small or large scale unit. It is basic requirement of all units. If we want to be success in our business we need to be very time punctual system. The organization can obtain there goal if they are working in a time system set by the firm.
Time is very important in business and also our life one times its goes than they never return. In the same way NAVBHARAT STEEL RE ROLLING MILL is very strict in this matter. The manager director of the unit is very conscious that he reaches in time. So, its employees and workers needs to reach at firm in time or before time but should not be late. The unit has been runner in a single shift only but if the demand of product is increased and if they are to be sent earlier than they go for two shift also. The regular shift is only one shift and the time is 10:00 P.M. To 6:00A.M.
It does does not not allo allow w to work worker ers, s, visi visito tors rs or trai traine nees es to ente enterr with withou outt the the permission of higher authority and they keep attendance register for the record of its employees. The employees have to signed into that register when they enter in NAVBHARAT STEEL RE ROLLING MILL and when they leave the unit.
The attendance register has been checked by the manager and it any loop poles are there they are rectified and checked upon.
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EMPLOYEE SERVICES
I
n any indust industry, ry, employ employees ees plays plays an import important ant role role for runnin running g busine business ss successfully. It is a well known proverb or also well provides that “If you
manage your employees, employees will manage your firm”. firm ”. Employees work in lower level management, but if they are not in business then company are not going to produce any product. It is, therefore necessary for manager to give much attention to the employee. The management should provide better service to the employees. If employees work better and do more work in the company their efficiency and morale become high. The Company has to provide various types of services to their employees. If a manager gives much attention on employees they will give fully attention in the business and the result is the more profitability as business increases. Employee services means to take care of the employees. if we see the most of entrepreneur’s history, who achieves the success they take care of their employees for E.g. Dhirubhai Ambani used to meet all their employee & ask them about improvemnent so that all his employee would feel good & part of his business. NAVBHARAT STEEL RE - ROLLING MILL Give various benefits provided to the workers for their welfare. There are no fixed uniform for workers. During specia speciall occasi occasion on and festival festival,, the workers workers are provided provided with a lump lump sum of money.
The company is providing facilities for first-aid and medical services.
The company is also take insurance of every employee.
If in any case any employee needs drawings company provide it.
Company also provides provident facility.
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On Diwali festival they distribute sweets to all the employees.
On Uttrayan festival they distribute threat and kites to the employees.
Company also gives tea coupon in certain limits.
They give extra bonus to some worker’s if they had done a good work.
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CONTENT SR NO.
PARTICULAR
(1)
IN TR OD UC TION
(2) (3)
DEFINITION OF HUMAN RESOURCE MANAGEMENT ORGANIZATION OF HUMAN RESOURCE MANAGEMENT
PAGE NO. 24 25 26
(4)
RECRUITMENT AND SELECTION
27
(5)
T R A I N IN G A N D D E V E L O P M E N T
30
(6)
J OB D ES CRIP TION
31
(7)
PROMOTION & TRANSFER POLICIES
32
(8)
PE R FOR MA NC E AP PR AISAL SYS TEM
34
(9)
WAGES & SALARY
35
( 10)
WORKING OF E.S.I SCHEME
37
( 11)
PR OVID EN T F UN D SC HE ME
38
(12) (13)
GRIEVIENCE HANDLING AT NAVBHARAT STEEL RE-ROLLING MILL COLLECTION BARGEINING & AGREEMENT
39 40
( 14)
TR AD E UN ION
41
( 15)
PER S ONN E L RE COR D
42
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INTRODUCTION
H
uma uman Res Resource urce Mana anageme gement nt is proc proce ess of brin bringi gin ng peop eople and and Organi Organizat zation ion together together it tries tries to secur secure e the best people people from group group of
people by winning their whole hearted for co-operation. In short, it may be define as the art of developing and maintaining competent work force to achieve the goal of an Organization in an effective manner.
Now a day for any company, it is important that personnel department should should effectivel effectively y developed developed.. Effective Effective developme development nt of personne personnell departmen departmentt helps the organization to accomplish the goal of the unit and its success. Without co-ope co-operat ration ion of the people people achie achieve ve met of goal goal canno cannott be done. done. Person Personne nell department deals with the planning organizing directing and controlling the human resource.
There is a famous proverb that “MIND YOUR MEN AND MEN WILL MIND ALL OTHER THINGS”.
For getting the best out of people they must be managed well. This is where human resource management (managers) plays at critical role in bringing gaps gaps betwee between n employ employee ee expect expectati ations ons and organi organizat zation ional al needs needs by adopti adopting ng appropriate human resource strategies and practices.
NAVBHARAT STEEL RE ROLLING MILL is havening a human resource depa depart rtme ment nt in whic which h the the mana manage gerr trie tries s to unde unders rsta tand nd the the prob proble lem m of the the employees. It tries to motivate its employees to work in a better way and with full energy. They try to maintain unity with the employees.
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DEFINITION OF HUMAN RESOURCE MANAGEMENT:
A
ccording to Decenzo and Robbins, “HRM is concerned with the people dimension in management. Since every organization is made up of people,
acquiring their services, developing their skills, motivating them to higher levels of performance and ensuring that they continue to maintain their commitment to the organizatio organization n are essential essential to achieving achieving organizationa organizationall objectives objectives.. This is true, regardless of the type of organization government, business, education, health recreation or social action.”
“Human resource management is a management function concerned with hiring, motivating, and maintaining people in an organization.”
“Human “Human resour resource ce manage managemen mentt is a proces process s which which brings brings people people and orga organi niza zati tion ons s toge togeth ther er so that that the the goal goal of each each one one is met met effe effect ctiv ivel ely y and and efficiently.”
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ORGANIZATION OF PERSONNEL DEPARTMENT
P
erso ersonn nnel el mana manage geme ment nt is conc concer erne ned d with with peop people le at work work and and thei their r
rela relati tion onsh ship ips s with with each each othe other. r. It may may be defi define ned d as a set set of prog progra rams ms,,
functions and activities designed to maximize both personnel and organizational goals. It ensures that the organization attracts and hires qualified, imaginative and competent people. It involves the establishment of various policies to deal with employees and to retain them. To this end, it lays out the rules regarding working conditions, designs appropriate compensation plans, and strengthens employer employee relations.
“Organization is a group of people working together co operatively under auth author orit ity y towa toward rds s achi achiev evin ing g goal goals s and and obje object ctiv ives es that that mutu mutual ally ly bene benefi fitt the the employees and the organization.”
In the NAVBHARAT STEEL RE ROLLING MILL they have well organized personnel department. Their organization is functional type and well the decisions in formations come from upper level. It means top to bottom. It can be under stand by the chart.
MANAGING DIRECTOR
PRODUCTION MANAGER
SALES MANAGER
PERSONNEL MANAGER
PERSONAL ASSISTANT
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ACCOUNTANT
RECRUITMENT AND SELECTION PROCESS Recruitment, selection and induction are very important part of the human resource management.
Recruitment:
“Recruitment is a process to discover the sources of manpower to meet the requir requireme ements nts of the staffi staffing ng schedu schedule le and to emplo employ y effect effective ive measur measure e for attracting that man power in adequate number to facilitate effective selection of an efficient working force.”
No fix qualification is required for the recruitment of the workers, because generally physical labour work is carried out by them.
Recrui Recruitme tment nt has been regard regarded ed as the most most import important ant functi function on of the personnel administration, because if a right right people is not selected selected than also the firm will not be able achieve their goals or target.
Manage Manageria riall work work is carrie carried d out by the superv superviso isor, r, assist assistanc ance e and and the manage managemen mentt direct directors ors and to some some extent extent by the execu executiv tive e direct director. or. so the supervisor is recruited by the managing director itself.
NAVBHA NAVBHARAT RAT STEEL STEEL RE ROLLIN ROLLING G MILL MILL
has to recruit recruit other persons persons
through following reasons:
1.
If some somebo body dy reco recomm mmen ends ds or oblig obliges es anyo anyone ne then then he is recr recrui uite ted d
2.
If a pers person on has has spe spec cial ial ski skill lls s for for the the job job the then n he he is is rec recru ruit ited ed..
3.
If employees believe that there will be a shortage of employees in Future they will recruit employees in advance.
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Selection: Select Selection ion is a negati negative ve proces process. s. It is of the proces process s of differ different entiati iating ng application in order to identify those with greater likelihood of success in a job.
It is related with securing relevant information about an applicant. Selection is a proc proces ess s of dete determ rmini ining ng the the qual qualifi ifica cati tion ons, s, expe experie rienc nce, e, and and know knowle ledg dge e creativity decisiveness for the particular job.
In NAVBHARAT STEEL RE ROLLING MILL the selection and recruitment is done internally hence they do not have to give any advertisement in the news paper and also there is no chance for calling people from outside.
In NAVBHARAT STEEL RE ROLLING MILL selection process is as follow:
(1) First to all they take those people who are in contact with NAVBHARAT
STEEL RE - ROLLING MILL employees and mostly the children’s of employees are taken.
(2) The selection committee will take their personal interviews and if they
pass the final interviews will be taken.
(3) They see their qualification, age, eligibility etc…
(4) Then the selected person will be given his joining date and his time and his work will be showed.
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Induction:In simple word induction means introduction the new employees are given
general information about the management and the work to be undertaken by him. In other word induction means when a new employee is been employed than he has been awareness about his work and rules and regulation.
In NAVBHARAT STEEL RE ROLLING MILL the head of the department does the induction program. He shows the new employee his job specification its duties duties and respon responsib sibilit ilities ies.. The super supervis visor or is given given the author authority ity to help help the employee and teach him his work with cool and mind and he tries to motivate the new employee to achieve the targeted goal of the firm.
In the introduction general information rules his work job description are give given n to the the work worker ers. s. The The new new empl employ oyee ees s are are made made fami famili liar ar with with othe other r employee’s supervisor his superior subordinate etc.
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TRAINING AND MANAGEMENT DEVELOPMENT
T
he newly recruited employee needs training and some basic information abou aboutt his his work work.. It is a proc proces ess s of teac teachi hing ng the the new new and and pres presen entt
employees. The basic skill they needs to effectively perform the job it is the process that tries to improve skills or add to the existing levels of knowledge so that employees is better equipped to do his present job or a higher level job. It is a learning process and experience that seeks a relatively permanent change in an individual that will improve his order ability to do the work.
Traini Training ng is a short short term term proces process s utiliz utilizing ing a syste systemat matic ic and organi organized zed procedure by which non-managerial personnel acquire technical knowledge and skills for a definite purpose. It is for a short duration, and is for a specific job related purpose.
While development is long-term educational process utilizing a system and organi organized zed proced procedure ure by which which manage manageria riall perso personne nnell learn learn concep conceptua tuall and theoretical knowledge for general purpose.
Definition of Training:-
“Training is the systematic modification of behavior through learning which occ occurs urs as a resu result lt of educ educat atio ion, n, inst instru ruct ctio ion, n, deve develo lopm pmen entt and and plan planne ned d experience.” (Micheal Armstrong)
In the same way NAVBHARAT STEEL RE ROLLING MILL gives training to the new recruited people and tries to explain their work in a very easy way. The
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new employees are given training under the higher authority people who have experienced and knowledge.
JOB DESCRIPTION
J
ob descrip descriptio tion n provid provide e both both organi organizat zation ional al inform informatio ation n means means locati location, on, structure, authority and functional organization/information means what the
work is job description describe job not job holders. Job description is not an assessment, it provides an important base for establishing assessment standard and activities and objectives.
Job description mainly related with management level only. With the help of job job desc descrip ripti tion on the the mana manage gers rs can can get get info inform rmat atio ion n abou aboutt job job title title,, rang range, e, department, job duty, reports submitting, location of job, objectives of job, job responsibility, authority or limitation of decisions, job environment etc…
It is the written statement. The objective of a job the work to be performs the skills to be needed responsibility to be involving the relationship of the job to the other job etc…
Definition of Job Description
A job description is a broad statement of a purpose, scope, duties and responsibilities of a particular job. Job description is the written summary of the given job, of the various rights, responsibilities and organization relation. Job description defines job division, duties and responsibilities which help to keep away the specific job to other job.
In NAVB NAVBHA HARA RAT T STEE STEEL L RE ROLL ROLLIN ING G MILL MILL Comp Compan any y they they have have a completely completely written document document of job descriptio description n and perfect implementa implementation tion also. Therefore work for the manager is being very easy and comfortable.
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PROMOTION & TRANSFER POLICY (A) Promotion :Promotion is the way to motive an employee but this motivation must be on certain strong base. The basic criteria on which employees are promoted are as under.
It consider seniority of employee
Qualification opinion
Supervisor’s opinion towards employee
Performance of employee
Extra efforts of work
The term promotion may be explaining an up word advancement of an employee in an organization to another job which commands better pay, better status status,, and and higher higher opport opportuni unity, ty, respon responsib sibili ility, ty, and autho authority rity better better workin working g environment hour’s rank.
In NAVBHARAT STEEL RE ROLLING MILL there is the policy to give promotion on the basis of performance & experience. The organization believes that efficiency of the employee increase along with time and experience. At the same same time time qual qualit ity y of work work and and perf perfor orma manc nce e appr approv oved ed is also also take taken n into into consideration. In the company worker has promotion to increment salary bases so he do work efficient way.
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(B) Transfer :A transfer is a horizontal of lateral movement of an employment from one job, department shift plant of position to another at the same or another place where his salary status and responsibility are the same.
Transf Transfer er is the moveme movement nt of employ employee ee from from positio position n to other. other. Usually Usually invo involv lving ing and and mark marked ed chan change ge is the the dutie duties s resp respon onsi sibi bilit litie ies s skill skill need needed ed or compensation.
In NAVBHARAT STEEL RE ROLLING MILL there is no transfer policy in the unit as it is only one production site so there is no question of transferring employee. Some employee transfer internally For E.G.:- from one department to other. This is also when some adjustment is to be done regarding the running of some equipment or adjust the employee who are on leave or are absent.
(C) Demotion :-
Demotion
refers
to
the
lowering ing
down
the
studies,
salary and
resp respon onsi sibi bili litie ties s of and and empl employ oyee ee.. It is used used as a meas measur ure e wher where e ther there e are are services branches of duty on the part of an employee when if is after a preliminary to a dismiss it defines as “The assignment of an individual to a bob of cover rank and day usually involving lower level of difficulties and responsibilities.”
In NAVBHARAT STEEL RE ROLLING MILL recruitment and selection are done very carefully and promotion is also given after same measurement so there is no caution of demotion. In this industry demotion is happened in very rare case.
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PERFORMANCE APPRAISAL SYSTEM
T
o appraise is to asset the work or value in the content of individual organi organizat zation ion.. Perfor Performan mance ce apprai appraisa sall is the system systematic atic evalua evaluatio tion n of
personnel by the supervisor of those familiar with their performance appraisal is the systematic way of judgment the relative work of an employee in performing their task performance appraisal has many different dimensions. It is the feedback process as well as an emotion process.
NAVBHARAT STEEL RE ROLLING MILL performance appraisal system system which helps its employees to overcome some times they are given bonus or some token for their good performance.
The procedure for performance appraisal is as follows:
Established performance standard Communication of performance expectations to employees Measures actual performance Compare actual performance with standards Discuss the appraisal with the employees Initiate corrective actions
In NAVBHARAT STEEL RE - ROLLING MILL having a well managed performance appraisal of its employee. Each and every department head is given deviation to work discipline, quality of work, co-operation etc…
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WAGES AND SALARY
T
here is big difference in salary and wage; wage is what paid to the workers who are employed on the contract base. While the salary is paid to the
employee of the company like, Executive Directors, Managers, and Supervisors etc…
WAGE:-
Method of Wage Payment :Method
Time Wage System : -
In time wage system pay the
worker wage on work time means how much time worker will work. This wage is pay on time period so this time is a day weak, a fortnight or a month. In the past wages have been the most common basis and therefore it came to be known as the ‘Day Wage System’.
Piece wage system :- In this system pay the wage based on the amount of work done or output of a worker. One unit of output is considered as one piece and a specific rate of wage is paid per piece. Greater is the number of pieces produced by a worker, higher is his remuneration. Thus, a workman is paid in proportion to his output. It is called payment by results.
Balance of debt system: - This method is a combination of time and piece wage systems. The worker is guaranteed a time rate with an alternative piece rate. If the wages calculated at piece
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rate exceed the time rate, the worker gets credit. On the other hand, if time wages exceed piece wages, the worker is paid time wage and the deficit is carried forward as debt to be reconverted in future. This method provides a sense of security to employees. At the same time an employee is given the opportunity to increase his earnings beyond the guaranteed time wage. This method is appropriate in industries where the flow is minimums, e.g. dock workers. But rates in this method have to be fixed on the most scientific basis. In NAVBHA NAVBHARAT RAT STEEL STEEL RE ROLLIN ROLLING G MILL, MILL, wages wages and salaries salaries are dist distrib ribut uted ed on the the 5th of ever every y mont month h and and if any any empl employ oyee ee want wants s sala salary ry in advance, company’ll give advance salary in between the Date of 1 st to 15th of the month. Time department keep watch on the each & every labour by taking regular atte attend ndan ance ce.. It is thei theirr duty duty to hand hand wage wage shee sheets ts.. Ther There e are are some some rule rules s & regulations for wage system.
SALARY:-
At NAVBHA NAVBHARAT RAT STEEL STEEL RE ROLLIN ROLLING G MILL, MILL, person personne nell depart departmen mentt of metro office does recruitment and they give joining sheet to new employee. On that basis P&A department at GCW give employee code number and P. S. No. (Pay Sleep Number) After that, they enter new entry in master file, which contains employee’s name, address, P. S. No., Department, designation, date of birth and other information.
Time office keeps attendance of all employees on daily basis and based on that they make monthly report about attendance. This is used in preparation of payment sleep. Monthly they deduct 12% of P.F. and directly transfer to head office.
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WORKING OF E.S.I. SCHEME E.S.I E.S.I is an abbre abbrevia viatio tion n of employ employee ee state state insura insuranc nce e schem scheme. e. This This is compul compulso sory ry for the compan company. y. Accord According ing to the “emplo “employee yee stat stat insura insurance nce act 1948.: E.S.I scheme is applicable on those companies in which there are more than 20 workers working according to factory act; this scheme covers those employees who have salary less than RS.7500 per month. This scheme provides them health and sound benefits of this scheme.
Under this scheme employees have to contribute 1.75% of their total salary while the company contributes 4.75% of their total salary. That total amounts that is 6.25% are sent at E.S.I. head office in Ahemdabad.
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PROVIDENT FUND SCHEME
A
ccording to provident fund act 1952,” Provident Fund means collection of money from the salary of employees and it will be paid at the time of
retirement, disablement or any other occasion. This scheme was started in 1962 and spread in all the industries. Any company having more than so workers can joint this scheme.”
In NAVBHARAT STEEL RE ROLLING ROLLING MILL all the permanent employees come under this scheme. Employees’ provident fund is deducted according to the rules and regulation of the company and this amount is deposited as contribution to prov provid ided ed fund fund in empl employ oyee ees’ s’ pers person onal al acco accoun unt. t. This This amou amount nt is paid paid to employee for any special occasion like marriage disablement or operation as a form of loan.
The NAVBHARAT STEEL RE ROLLING MILL also follows provident fund act. It provides the provident fund on government rules in present scenario is 12% provid provident ent fund is given given and this compan company y is given given this provide provident nt fund fund to its employees.
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GRIEVANCE HANDLING PROCEDURE
G
rievan rievance ce handli handling ng proce procedur dure e is used used to solve solve the disput disputes es betwee between n employee and employee or employer and other employer. When the
disp disput ute e aris arises es betw betwee een n empl employ oyee ees s it is settl settled ed by griev grievan ance ce proc proced edur ures es.. Company uses various methods to solve the disputes.
In NAVBHARAT STEEL RE – ROLLING MILL there is no specific treatment for the grievance. It means if the problems is occurred, the offi cer take out the solution of this.
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COLLECTIVE BARGAINING AND AGREEMENT
C
ollective bargaining is the resolution of industrial problem between the repr repres esen enta tativ tive e of empl employ oyer er and and free freely ly desi design gnat ated ed repr repres esen enta tativ tive e of
employees acting collectively with a minimum of government dictation. Collective bargai bargainin ning g is an essent essential ial elemen elementt of econom economic ic democr democracy acy is a ‘Two ‘Two Party’ Party’ procedure to arrive at mutually agreed solution.
IN NAVBHARAT STEEL RE – ROLLING MILL, try to provide their level best to fulfill worker and management. NAVBHARAT STEEL RE – ROLLING MILL industry provides many facilities to their worker. Here the whole work is do manual so there is on major problems create between worker and management.
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TRADE UNION
T
rade unions are voluntary organizations of employees or employers formed to promote and protect their interest through collective action though he
terms terms employ employees ees and employer employers s are used used when when we say trade unions unions.. They They generally refers to employees trade union must be,
(1)
A combination of workers or employers
(2)
Such a combination combination could be permanent permanent temporary
(3)
Could include federation of two or more unions
(4)
To regulate relations or among employers
In the the NAVB NAVBHA HARA RAT T STEE STEEL L RE ROLL ROLLIN ING G MILL MILL rela relati tion on of the the staf staff f member workers is like family member they are only 70 to 80 workers. They work with co-operation. So here there is no trade union.
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PERSONNEL RECORD
A
record is piece of writing or a chart which provides ready information and which preserves evidence for feature reference or use records provides
tangible evidence of the past activities of an organization. It also provides the information relating to various aspects of human resources of an organization viz. wages and salary productivity social security absenteeism employee welfare, job satisfaction etc…
In NAVB NAVBHA HARA RAT T STEE STEEL L RE - ROLL ROLLIN ING G MILL MILL pers person onne nell depa depart rtme ment nt maintains a wide range of records consisting details information about each every aspects of organization. This firm adopts computer system as well as manual system for keeping all the data about employees.
In NAVBHARAT STEEL RE - ROLLING MILL the personnel records of all the employees are are maintain through personnel personnel department. Such as.
Name and addresses of employees.
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Telephone no. Of employees. Name of parents. Date of joining. Designation and nature of work. Salary and allowances rate. Monthly attendance, leave and salary position. Service disciplinary action report. Remarks.
So, personnel record is a very essential part of the every organization. Thro Throug ugh h the the pers person onne nell reco record rd the the mana manage geme ment nt can can know know all all the the thin things gs of employee.
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.
Content SR NO.
PARTICULAR
(1)
INTRODUCTION
(2) (3)
ORGANIZATION OF MARKETING DEPARTMENT PRODUCT PLANIING
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PAGE NO. 45 46 47
(4)
MARKET SEGMENTATION
48
(5)
PRICING POLICIES
50
(6)
CHANNELS OF DISTRIBUTION
51
(7)
ADVERTISEMENT
53
(8)
MARKETING RESEARCH
54
INTRODUCTION
M
arke arketi ting ng is one one of the the most most impo import rtan antt part parts s in the the mana manage geme ment nt.. Mark Market etin ing g is done done to mak make its its prod produc uctt fami famili liar ar to the the cust custom omer er..
Marketing means the creation and delivery of standard of living. It is social and managerial process by which individuals and groups obtain what they need and want to create after and exchanging products of value with others. It also means working with market of actualize potential exchange for satisfying human needs and wants.
The goal of marketing is to create customer satisfaction profitability by building valuable relationship with important customer marketing is very essential for all the firms whether manufacturing companies, whole seller, retailers and other individuals.
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Definition of Marketing:“Marketing is the process of planning and executive the conceptions pricing, promotion and distribution of ideas, goods and services to create exchange that satisfy individual & organization goals.”
-As per AMA (American Marketing Association)
ORGANISATION OF MARKETING DEPARTEMENT
O
rga rganiz nizatio ation n
of
mark arketin eting g
depart partme ment nt
defin efines es
the the
auth autho oriti ritie es,
responsibilities of the employee of the department. In the NAVBHARAT
STEEL RE-ROLLING MILL the head office of the marketing is in 5, city centre Kalanala Bhavnagar. But the unit’s market is spread in the all over India. So we can say that authority and responsibility r esponsibility of marketing department very high.
ORGANIZATION CHART OF MARKETING DEPARTMENT
President
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Marketing manager
Distributor
Dealers
PRODUCT PLANNING
P
roduct planning means, “Introduce a new product in the market other word it is adding a new product product to existing existing line of the company company.” .” The products products
may may be as per per the the need needs s and and the the requ requir irem emen ents ts of cons consum umer ers s or may may be introducing due to a technological and development new product developments. A new new prod produc uctt deve develo lopm pmen entt is diff differ eren entt from from prod produc uctt inno innova vatio tion n or prod produc uctt modification. In any company they follow customer oriented product planning process union is as follow 1)
Idea generation
2)
Idea screening
3)
Concept testing
4)
Business analysis and market share analysis
5)
Actual development of new product
6)
Test marketing
7)
Commercialization Every Every unit unit requir requires es some some sort sort of planni planning ng for their their produ product. ct. In NAVBHA NAVBHARAT RAT STEEL RE-ROLLING MIL. they use following parameters.
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1)
Market survey
2)
Quality of product
3)
Market research
4)
Stud Study y of comp compet etit itor or’s ’s and and comp compet etito itor’ r’s s prod produc uctt
5)
Market te testing
6)
Satisfaction
MARKET SEGEMENTATION A market segment consists of a group of customers who share a similar set of needs and wants. There are many bases of market segmentation the four main bases are as follow
(1) (1)
Geographic se segmentation
(2) (2)
Demographic segmentation
(3) (3)
Psyc Psych hograp raphic segme egmen ntati tation on
(4) (4)
Behavioral se segmentation
The market for any product is normally made up of several segments. A “Mar “Marke ket” t” afte afterr all all is the the aggr aggreg egat ate e of cons consum umer ers s of a give given n prod produc uctt and and consumers who make a market are seldom homogeneous, they very in their char charac acte teris ristic tics s and and buyi buying ng beha behavi vior or.. It is thus thus natu natura rall that that many many diff differ erin ing g segments occur within a market.
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Advantage of market segmentation as under
1)
Faci Facili lita tate tes s pro prope perr cho choic ice e of of tar targe gett mar marke ket. t.
2)
Faci Facili lita tate tes s eff effec ecti tive ve lapp lappin ing g of of the the mark market et..
3)
Helps divide the markets and convert them
NATIONAL LEVEL MARKETING “NAVBHARAT STEEL RE ROLLING MILL” is having a market for its product in all the major states of the country and they have appointed to their customers. They cover all the parts of India here are the few parts where the comp compan any y
acqu acquir ires es
maxi maximu mum m
sale sale
Gujar Gujarat at,,
Maha Mahara rash shtr tra, a,
Madh Madhyp ypra rade desh sh,,
Hariyana, Bihar etc.
INTERNATIONAL LEVEL MARKET “NAVBHARAT STEEL RE ROLLING MILL” has created a good reputation for its product even in foreign countries like Nepal, Iran, Iraq, and Malaysia etc.
NAVBHARAT STEEL RE ROLLING MILL has its market spread widely. Here market segmentation is base on geographical, sales and customer needs. It has many dealers in India. They are to increase sales and profits.
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PRICING POLICY
P
rice is the amount of money changed for a product or service or the sum of the value that customers exchange for the benefits of having or using the
produc productt or servic service. e. Price Price has been been the major major factor factor affect affecting ing buyer buyer choic choice. e. However in recent decade non price factor have become more important in buyer choice behavior
TOTAL PRICE = Production Cost + Administration Cost + Taxes + Profit
Company decide price policy with help of following pricing method
Cost-based pricing
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Demand based pricing
Competition-oriented pricing
Value pricing
Product line oriented pricing
Tender pricing
Affordability-based pricing
Differentiated pricing
At the time of making decision regarding price NAVBHARAT STEEL RE – ROLLING MILL keeps in mind following factors.
1)
Price of raw-material
2)
Cost of production
3)
Competitors pr price
4)
Condit ability in market
5)
Wage ages, salar alary y and lia liabilit ilitie ies s of em employ ploye ee
6)
Government di direct an and in indirect ta taxes
7)
Advertising ex expenses
8)
Sales ta tax an and pr professional ta taxes
9)
Municipal octroi and land and building taxes Interest of capital investment
CHANNELS OF DISTRIBUTION
D
istr istribu ibutio tion n chan channe nell or mark market eting ing chan channe nell is a set set of inte interd rdep epen ende dent nt
organi organizat zation ions s involv involved ed in the proces process s of making making a produc productt or servic service e
available for use or consumption by the consumer or business user.
Direct Dire ct Marketin arke ting g Channel:hanne l:A marketing channel has no any intermediary level.
Indirect Marketing Channel:
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A channel is containing one or more intermediary levels.
CUSTOMER MARKETING CHANNEL
0-level Manufacturer
1-level Manufacturer
2-level Manufacturer
3-level Manufacturer
Wholesaler
wholesaler
Jobber
Retailer
Consumer
Consumer
Retailer
Retailer
Consumer
Consumer
DIRECT Channel
INDIRET Channel
Manufacturer
Manufacturer
Consumer
Agent
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Wholesaler
Retailer
Consumer
NAVBHARAT STEEL RE ROLLING MILL follows this indirect channel of distribution.
ADVERTISEMENT
A
dvertising is the way of communication with the people. The people can get get the the info inform rmat atio ion, n, knowl nowle edge dge of the the prod produc uctt with with the the hel help of
advertisement. It is the world of neck to neck competition in the market. All the companies want to sale their product is big scale in the consumer market. For this reason reason advert advertise isemen mentt is the most most import important ant tool. tool. Advert Advertise isemen ments ts are for all products new products as well as current or existing products. It is being more effective at Deepings brand loyalty. Advertising is also employed to promote the
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brig bright ht imag image e of the the comp compan any y in the the minds minds of peop people le.. Peop People les s get get attra attract cted ed towards the advertisement of the product.
The The NAVB NAVBHA HARA RAT T STEE STEEL L RE ROLL ROLLIN ING G MILL MILL Comp Compan any y uses uses the the advertisements to attract the buyers. The company uses mass production and mass sale of the TMT Bars. The main way of advertisement of the iron bar is internet. The company has to advertise the bars in all over the glob; therefore print media is not sufficient, therefore they have to advertise through net. This company creates his own site and in that he put all the information about his product for running and any new product is going to launch in future. He has put all his information on the web-site. So, any retailer or consumer want to purchase his product, he can open the site and can take the information then he can contact to the company. His contact number and address has been existed on the web site. So, it is ease to give the order to the company, and the effective way is that “one person says to another person because this company’s status is very good”.
MARKETING RESEARCH
M
arketing to marketing association “marketing research is the systematic gathering, recording and analysis to data about problem relating to the
marketing goals and servicing”.
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Market research is a management tool that involves the top management to lear learn n more more abou aboutt the the appr approp opri riat ate e “mar “marke ketin ting g most most”. ”. It is the the inte intell llig igen ence ce services of the industry capable of furnishing ideal solution to different marketing problem that arise in day to day business.
Marketing research is the systematic squirting, recording and analyzing of data problem relating to the marketing of goods and services. It is collecting data then analyzing data and then put out in classification.
NAVBHARAT STEEL RE ROLLING MILL also does market research to know their customers requirement and their need. It is also done to know the changes in the taste and preferences of the customers. As we know that research is also done to the needs and the demand of their product in the market.
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.
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Content SR NO.
PARTICULAR
(1)
INTRODUCTION
(2)
ORGANIZATION OF FINANCE & ACCOYNT DEPARTMENT
PAGE NO. 57 58
(3)
LEVERAGE
59
(4)
CAPITALIZATION
60
(5)
CAPITAL STRUCTURE
62
(6) (7) (8)
MANAGEMENT OF FIXED ASSETS MANAGEMENT OF WORKING CAPITAL RATIO ANALYSIS
INTRODUCTION
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64 65 67
F
inance is lifeblood of any institute or business. Finance is the wheel to which one can generate and direct its business of the achievement of the
organization goals. Proper management of finance department forms the base to increase increase the profitabilit profitability. y. In business, business, cost to create create and maintain maintain a product is in the hand of businessman. In competitive era sales and profit are not in the hands of entrepreneur.
“Money is the soul and of coarse the blood of any share of business.”
Financial Management means procurement of the fund at minimum cost and time from the various sources and its development in the business activities for the smooth and successful running of the business.
Financial Management is an integral part of the overall management of the firm. firm. The The impo import rtan antt of fina financ nce e func functio tion n depe depend nds s larg largely ely on size size of the the firm. firm. Financ Finance e manag manageme ement nt includ includes es differ different ent types types of financ financial ial decisi decision, on, liquid liquidity ity decision that decides the fortune of any business.
In NAVBHARAT STEEL RE - ROLLING MILL responsibility is on the head of finance manager. He has to take so many decisions related to the finance. The finance manager has to the great care to deal with financial matter.
ORGANISATION OF FINANCE AND ACCOUNT DEPARTMENT
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T
o Raise finance at a right time and to utilize it most efficiency are primary function of financial management. Basically all finance function are same in
all types of business organization.
i.e. in sloe proprietorsh proprietorship ip firm with small size all function function in a medium size firms finance department is created in a large size business unit however a clear and detail division of finance function is made.
In NAVBHARAT NAVBHARAT STEEL STEEL RE ROLLING MILL MILL func functi tion on is hand handle le by
is developing developing unit unit there finance finance
MR.B MR.BHA HAGI GIRA RATH THSI SINH NH G SARAV SARAVAI AIYA YA
and and his two two
assistance MR. KANAKSIH AND MR. RAJENDRASINH organization structure of the company is not large which is show as under.
The organization chart of finance department is as under: FINANCE MANAGER
ACCOUNT MANAGER
ASSISTANT A/C MANAGER
CHIEF ACCOUNTANT
ASSISTANT ACCOUNTANT
LEVERAGE
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I
n very simply words, the term leverage measures relationship between two variables. In financial variable over some other financial variable. In financial
analysis, generally three types of leverages may be computed.
Operating Operating
Leverages: -
It measures the effect of change in sales quantity and operating capacity on Earnings Before Interest and Taxes (EBIT). It is computed as: Sales-variables cost Operating Leverage= ---------------------------------------------Earnings before interest and tax Financial
Leverage: Leverage: -
It indicates the firm's ability to use fixed financial charges to magnify the effects of changes in EBIT on the firm's EPS. It indicates the extent to which the earning before interest and tax (EBIT) It is computed as:
EBIT Financial Leverage = --------EBT
Combined
Leverage: Leverage: -
The The comb combin ined ed effe effect ct of oper operat atin ing g lev leverag erage e and and fina financ ncia iall leve levera rage ge measures the impact of change in contribution on EPS. It is computed as: Combined Leverage = Operating Leverage x Financial Leverage. Leverage analysis is not applicable in NAVBHARAT STEEL RE-ROLLINGS MILL
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CAPITALISATION
F
inance manager has to decide what amount is required. This decision includes estimation of total fund required by a business unit. The total
requires. This decision includes estimation of total fund required by a business unit. unit. The The tota totall amou amount nt of capi capita tall and and reve revenu nue e expe expend ndit itur ure e of a comp compan any y is estimated and on that basis what fund is required as estimated. This is called capitalization.
The word capitalization can be define as sum total of all kinds of long terms securities at there par values. Thus it can be interpreted as the sum of ownership capital and borrowed capital it also includes surplus.
“Capitalization is the total accounting value of the capital stock, surplus in whatever form it may appear and long term debts”.
“Capit “Capitali alizat zation ion includ includes es amount amount of capita capitall to be raised raised,, the securi securities ties through which it is to be raised and his relative proportion of various classes of securities to be issued and also the administration of capital”.
There is no specific time of analyzing the problem of capitalization. It is not like that at time of promotion of a company the capital problems causes. It can be carried at any time during the life of a company. Generally, there are 3 types of capitalization.
Capital is one part of Capitalization
Share capital = Equity Share Capital + Preference Share Capital
Capitalization = Share Capital + Debenture Capital + Long Term + Borrowing + Free reserves
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Capitalization is been divided into 3 parts
1)
OVER CAPITALIZATION :Whenever the aggregate of the par valued of shares and debentures out
standing of a company exceeds the true value of its fixed assets the company is said to be over capitalized.
2)
UNDER CAPITALIZATION :Reversing the concept of over capitalization under capitalization refers to
the excess of have value of assets against par value of share and debentures. such cases of under capitalization are very rare.
3)
FAIR CAPITALIZATION :It refe refers rs enou enough gh finan finance ce acco accord rdin ing g to its requ requir irem emen entt no less less to its its
requirement than it is called fair capitalization.
NAVBHARAT STEEL RE - ROLLING MILL Is near to fair capitalization.
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CAPITAL STRUCTURE
T
he two principal sources of finance for business firm are Equity share, Preference share and Debentures. The combination of these three sources
is known as "Capital Structure" of the business unit. The combination leads to maximum value of firm is known as the optimum capital structure. Thus capital structure refers to the composition of capital.
(1) Equity Share Holder:Equity share holders are the owners of the business. Equity share may be regarded as the backbone of capital structures of a company. Equity shareholders are the real risk bearers of company’s business, this share do not carry out special right in respect of dividend of return of capital in the event of the winding up of the company. They get dividend only after the debenture holders and preference share holders have received their specified return similarly they rank last in their claim of the assets of the companies, in case of liquidation after all other debts and preference share capital are real risk bearers of the companies business.
(2) Preference Share Holder:Preference shares are kind of high bride security containing features of date and equity share. In the event of liquidation liquidation preference preference share holders claim on assets comes after creditors but before ordinary shares. Usually this claim is restricted to face value of the share.
Acco Accord rdin ing g to Indi Indian an co. co. act act 1956 1956 pref prefer eren ence ce shar share e is that that whic which h has has following 2 preference share right.
(1)
Preference share holder should be paid dividend before equity share
(2)
At the time of liquidation preference share capital is return before equity share capital is return before equity share capital is return.
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Company can issue various types of Preference Shares. (A) Participating preference shares (B) Non participating preference shares (C) Cumulative preference shares (D) Non cumulative preference shares (E) Convertible preference shares (F) Redeemable preference shares (G) Irredeemable preference share
(3) Debentures:Debenture is not a part of share capital of a company. It is a security by which a company borrows money from general public or from financial institution. When a company need money for long period but it is hope ful of being able to return money it issues debentures. By issuing debenture the company borrow money from public. The company issues debenture certificate to the person who purchase the debenture. Thus debenture is an instrument threw which a company acknowledges the debt.
NAVBHARAT STEEL RE ROLLING MILL is Partner Ship Company so the company is not issued any Equity, Preference and Debenture
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MANAGEMENT OF FIXED ASSETS
T
here are 2 types of assets in each business organization i.e. fixed assets and currents assets both types of assts are to be managed efficiently and as
to earn maximum profit with minimum possible investment
Fixed assets of company are the permanent capital of company. It helps in production process and used for long period hence proper management of fixed assets is very important for every company measure consideration should be given and that is why decision regarding fixed assets that to be used over a long period NAVBHARAT STEEL RE – ROLLING MILL has very big amount of fixed assts which are has under
Sr. No.
Fixed assets
Amount in Rs. (Approx)
(1)
Land
25 lacs
(2)
Building
30 lacs
(3)
Machinery
60 lacs
TOTAL Rs.
115 lacs
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MANAGEMENT OF WORKING CAPITAL
W
orking orking capita capitall manage managemen mentt involv involves es decidi deciding ng upon upon the amount amount and composition of current assets and how to finance these current assets.
The lower the amount of working capital level maintained the more the risk of running business and more will be the profitability
There
are two types of working capital like
1) Gross Gross Workin Working g Capital Capital :Gross working capital indicates the liquid position of the firm. It helps the manage managemen mentt to look look for perman permanent ent source sources s for financ financing ing its workin working g capital.
2) Net Working Capital :-
Net working capital indicates the liquid position of the firm it helps the management to look for permanent sources for financing its working capital need.
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CASH MANAGEMENT Cash a liquid and assets is the basic input required to run the business. It includes cash and near cash assets like c both cash management is concerned with with the the mana managi ging ng of cash cash flows flows into into and and out out or with within in the the firm. firm. The The basi basic c objective of cash management is to reduce the operating cash requirement to the minimum possible extent without affecting the routine transaction.
In NAVBHARAT STEEL RE ROLLING MILL petty cash book is managed and most of the transaction is done by cash.
INVENTORY MANAGEMENT Mana Manage geme ment nt of inve invent ntor ory y assu assume mes s impo import rtan ance ce due due to the the fact fact that that investment in inventory constitutes one of the major investments in assets. The objective of inventory in order to facilitate efficient and smooth production and sales operation and sales operation and also to minimize investment in inventory to maximize profitability. In mana manage geme ment nt of inve invent ntor orie ies s in NAVB NAVBHA HARA RAT T STEE STEEL L RE – ROLL ROLLIN ING G MILL MILL,, the the reco record rd of inve invent ntor ory y is main mainta tain ined ed of fact factory ory prem premis ises es according to rules and regulation.
RECEIVABLE MANAGEMENT Receivables or book debt is created by the trade and arises out of credit transa transacti ctions ons.. The basic basic objec objectiv tive e of receiv receivabl ables es or credit credit.. Manag Manageme ement nt is to maximize the value of the firmly obtaining optimum volume of sales by controlling the cost of credit and keep it at minimum.
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RATIO ANALYSIS
R
atio analysis is a powerful tool of financial analysis. A ratio is defined as the systematic use of the ratio to interpret the financial statement so that
the strength and weaknesses of a firm as well as its historical performance and current financial condition can be determined. Also it can be said as “the indicated quotient of two mathematical expressions and as “the relationship between two or more things”. In financial analysis ratio is used as the benchmark for evaluating the financial position and performance of the firm. The relationship between two accounting figures expressed mathematically is known as a financial r atio.
Tradit Tradition ional al classi classific ficatio ation n is based based on financ financial ial statem statement ent to which which determines the ratio belongs. Profit and loss account ratios are based on profit and loss account only. Balance sheet ratios are based on the figures of the balance sheet. Composite or inter-statement ratios are based on both that is the profit and loss account and balance sheet.
CLASSIFICATION OF RATIOS :-
1.
Revenue
Statement Ratio 2. Balance Sheet Ratio (A) Gross
Profit (A) (A) Curr Curren entt Ratio Ratio
Ratio (B) Operating Ratio
(B) (B) Liqu Liquid id Rati Ratio o
(C) Expens Expenses es Ratio Ratio
(C) (C) Quic Quick k Rat Ratio io
(D) Net profit profit Ratio Ratio
(D) Propri Proprieta etary ry Ratio Ratio
(E) (E) Stoc Stock k Turno Turnove ver r
(E) Debt-equity Ratio
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Gearing Ra Ratio (F) Capital Ge
(G) Long Te Term De Debt
(1) Revenue Statement Ratios:(A) Gross Profit Ratio :This This Ratio Ratio gives gives the inform informati ation on about about gross gross margin margin of profit realized in the company. Gross Profit Gross Profit Ratio
=
-------------------------- X
100 Sales
(B) Operating Ratio :By this Ratio we will get information about how much total margin of expenses realized in business. Cost of Goods Sold + Operating Expenses Operating Ratio = --------------------------------------------------------- -----------------------------------------------------------
X
100
Net Sales (C) Expense Expense Ratio:This Ratio gives information about how much margin of expenses out of Total Sales. Expense Expense Ratio = ------------------------- x100
Total Sales (D) Net Profit Ratio :
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By this this Rati Ratio o we will will set set the the info inform rmat atio ion n of net net margin of profit realized on sales.
Net Profit Net Profit Ratio =
--------------------------- x 100 Total Sales
(D) Stock Turnover:This Ratio gives the information about how many times stock becomes change in a year. Cost of Goods Sold Stock Turn Over =
----------------------------Average Stock
Cost of Goods Sold = Sales – Gross Profit Cost of Goods Sold = Operating Stock+ Purchase+ Expense for Purchase Closing Stock
(2) Balance Sheet Ratio:(A) Current Ratio :This most widely used Ratio shows the proportion of curr curren entt asse assets ts to curre current nt liabi liabilit lity. y. It is also also know known n as “Wor “Worki king ng Capi Capita tall Rati Ratio” o” as it is a meas measur ure e of work workin ing g capital available at a particular time. The ratio is obtained by dividing current assets by the current liability. Generally comfortable Ratio is 2:1 Current Assets Current Ratio =
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Current Liability
Current Assets = Closing Stock + Cash & Bank Balance + Debtors + Bills Receivables + Prepaid Expenses + Out Standing Income + etc…
Current Liability = Creditors + Bills Payable + Bank Overdraft + Out Standing Expenses + Provision for tax + Proposed Dividend + Provident Fund + Gratuity + etc…
(B) Liquid Liquid Ratio:A variant of a Current Ratio is Liquid Ratio or Quick Ratio which is design to show the amount of cash available to meet meet immed immedia iate te paym paymen ent. t. It is obta obtain ined ed by divi dividi ding ng Liquid Assets by Liquid Liabilities. Liquid Assets are obtained by deducting stock-intrade from Current Assets. Stock is not treated as l Liquid Assets because it can not be readily converted into cash as when required. If the Liquid Assets are equal to or more than Liquid Liabilities, the condition may be considered as satisfaction. Generally standard margin of this Ratio is 1:1 Liquid Assets Liquid Ratio =
-------------------------------Liquid Liabilities
(C) Acid-Test Ratio:This ratio gives the information regarding actual liquidity of the company. Ideal ratio is 0.5:1. Quick Assets Acid-test ratio =
---------------------------
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Liquid Liabilities
(D) Proprietary Proprietary Ratio:The Ratio shows the proportion of the proprietor’s fund fund to the total assets assets employed employed in the business business.. The The proprietor’s funds or share holders ‘Equity consists of share capital and reserves and surplus’. The higher the ratio, the stronger the financial position of the enterprise.
Proprietor’s Fund Proprietary Ratio = --------------------------Total Assets
(E) Debt Equity Equity Ratio:This Ratio is only another form of Proprietary Ratio and establishes relationship between the outside long term liabilities and owners fund. It shows the proportion of long term external equities and internal equities i.e. Proportion of funds provided by long term creditors and that provided by shareholders or proprietors. Long term liabilities Debt-equity ratio = ------------------------------------------------------- ------------------ x
100
Share holders funds
(F) Capital Capital Gearing Ratio:This Ratio expresses the proportion of preference capital and ordinary capital. In other words, it is ratio of fix fixed
divid ivide end
gear earing ing
capita pitall
to
ordi ordin nary ary
capi capita tal. l.
Some Sometim times es,, even even debe debent ntur ures es are are incl includ uded ed alon along g with with preference capital. The higher this is ratio i.e. the greater
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the propor proportio tion n of Prefer Preferenc ence e Capital Capital and Debent Debenture ures s to ordinary capital. Fixed Interest Bearing Capital Gearing
Ratio
=
----------------------------------------------------------Ordinary Capital
(G) Long Term Funds to Fixed Assets: The fixed assets of business must be purchased out of fixed capital only. This includes share capital, reserves, and long term liabilities. This ratio, therefore, shows the relation ship between fixed capital and fixed assets.
Long Term Fund Long
Term
Funds
to
Fixed
Assets
Ratio:
=
----------------------------------Fixed Assets
NAVBHARAT
STEEL
RE
ROLLING
MILL
Company do not give any financial information. So, we do not calculate the Ratio Analysis sums.
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BIBLIOGRAPHY GENERAL INFORMATION Web site:www.navbharatsteelreROLLING.org
Email :
[email protected]
BOOKS
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SUBJECT
AUTHOR Prof. Udai Parikh C.B. Mamoria,
HUMAN
S.V.Gankar, Himmalya Publishing
REASOURCE
house, Mumbai.
MANAGEMENT:
Philip Kotler, Gary Armstrong
MARKETING
‘Principle Of Marketing Management’, 11th edition, edition, 2007,
MANAGEMENT:-
New Delhi. Prof. S.P. Shah, Dr. Paresh Shah,
FINANCIAL
Dr P.K.Priyam, Dr. Hitesh Shukla, ‘Finance Management’., Management’., 1st
MANAGEMENT:-
7
Edition 2002-03
3
