atul auto limited-2

AN

INDUSTRIAL VISIT REPORT

ON

PREPARED BY

PARVADIYA ASHISH

CLASS

F.Y.B.B.A.

ACADEMIC YEAR

2007-2008

ROLL NO . SEAT NO.

COLLEGE

GUIDED BY

SUBMITTED TO

DECLARATION

I undersigned XXXXXXXXXXXX a student of Second Year

Bachelor of Business Administration, here by declare that the project –

work presented in this report is my own work and has been carried out

under the supervision of xxxxxxxxxxxxxxxx of

xxxxxxxxxxxxxxxxxx

This work has not been previously submitted to another

university for any examinations.

Date: -

Place: -

Signature

(xxxxxxxxxxxxxx )

PREFACE

Practical studies important in almost all aspects of human life

keeping this in view the S.P.University has included the subject of

practical studies in Bachelor of Business Administration. In S.Y.B.B.A.

the objective of Industrial visit is to give a respective about the

organization and functioning in an industrial unit.

It is quite interesting to know practically the aspects of the

working of a manufacturing unit. The unit I visited was ATUL AUTO

LTD., a leading manufacturer of two or three wheeler commercial

vehicles.

After the visit I have learnt a lot and have carefully collected the

information which is presented here in the best possible manner and to

the best of my ability. I am sure this would enhance my knowledge

about business practice and management in various fields of Business

Administration.

ACKNOWLEDGEMENTIt is my great pleasure to present this report before you. I

sincerely thank all officers and staff of ATUL AUTO LTD. for their co-

operation during the visit and for providing me the essential details of

the working of the company.

I am also thankful to Dr. Ajayraj M. Vyas for guiding me through

out the preparation of this report and for her valuable suggestions.

I would also like to thank our Principal, My Brother, My Last but

not the least Parents, My Classmates and my friends for their

encouragement and support during the work.

I have tried my level best to present the available information in

the best possible manner.

Date: -

Place: - RAJKOT

Signature

(PARVADIYA ASHISH)

GENERAL INDEXSr. No. Particulars Page No.

1 General Information

2 Production Department

3 Personnel Department

4 Marketing Department

5 Finance Department

6 SWOT Analysis

7 Future Plans

8 Suggestions

9 Conclusion

10 Bibliography

CONTENTSSr. No. Particulars Page No.

1 History & Development

2 Company Profile

3 Organization Structure

HistoryThe unit was initially set up at Jamnagar as a Private limited

company on 18th June 1986, under the companies Act 1956. It was

registered with the registrar of companies of Maharashtra State and later

on transferred its registered office to Gujarat state on 21st January 1992,

at Jamnagar City.

The company purchased land at Jamnagar & undertook the

project however, due to their failure to avail basic infrastructure

facilities like electricity at Jamnagar the promoters decided to shift their

location to Shapar (Veraval) village of Rajkot. they started the unit there

on 1st May 1992. These after, on 12th August 1997 finally the company

was converted into public limited company as ATUL AUTO LIMITED.

The promoters of the company are Shri Jayantibhai J. Chandra,

late Shri Atul J. Chandra and Shri Mahendra Patel. They all are leading

industrialists with vast experience of trade and industry.

Company Profile(a) Name of Company : ATUL AUTO LTD.

(b) Corporate Office

Address

: “Jimmy Tower”,

Opp. Swaminarayan Gurukul,

Gondal Road,

RAJKOT – 360 002.

(c) Registered Office

Address

: Survey No. 86,

Plot No. 1 to 4, N. H. 8-B,

Tal.: Kotda Sangani,

Shapar (Veraval),

RAJKOT – 360 004.

(d) Year of Establishment : 1st May 1992

(e) Year of Commencement : 1st May 1992

(f) Main Products : Automobiles (Three Wheelers)

(g) Production Capacity : 1500 Units (Monthly)

(h) Form of Organization : Joint Stock Company

(i) Size of Unit : Large Scale Unit

(j) Names of Promoters : Shri J. J. Chandra

Shri Atul J. Chandra

Shri Mahendra Patel.

(k) Board of Directors

Shri J. J. Chandra

Shri N. J. Chandra

Shri M. J. Patel

Shri R. H. Druva

Shri R. S. Kukreja

Shri S. T. Kaneria

:

:

:

:

:

:

:

Chairman & Managing

Director

Whole Time Director

Joint Managing Director

Director

Director

Director

(l) Auditors : M/s. Maharishi & Co.

Chartered Accountants

JAMNAGAR.

(m)

Total Area Covered : 10 acres.

(n) Bankers : State Bank of India

(o) Brand Name : ATUL SHAKTI

Organization StructureATUL AUTO LTD. is a large scale company and this has a

vast organization structure. The company has established a network

of over hundred dealers all over India and abroad.

The organization structure of the company is based on the

principles of modern scientific management.

The organization structure in detail is given on the next

page.


1 Introduction


3 Production Planning & Control

4 Raw Material

5 Production Process

6 Plant Location

7 Plant Layout

8 Inventory Control

9 Pollution Control

10 Quality Control

11 Scrap & Waste Management

12 Stores Management

13 Material Handling

IntroductionProduction department is one of the most important departments

of any industrial unit. Without this department all the other departments

are of no use to the company. Production means the conversion of raw

materials into finished products with the help of certain processes. The

aim of any production system is to produce the desired goods & services

effectively & efficiently.

In automobile manufacturing unit should be well versed in terms

of technology and equipment to give the best products to its consumers

and stay ahead of the competition. Also the scale of production should

be large to avail benefits of mass production at both ends of production

as well as sales.

Organization StructureThe organization structure is very important in the production

department. It clarifies the positions of every employees and the

employees come to know what they are expected to do at different

levels.

ATUL AUTO LTD. has a separate production department. Mr.

M. H. Desai is the head of the department.

Chart of Production

Department

M.D.

J.M.D.

D.G.M. (Production)

Manager (Production)

Asst. Mgr.(M&C)

Asst. Mgr.(Assm)

Sr. Eng(PDI)

Sr. Eng(F/S)

P.S(I.C.)

Sr. Eng.(Planning

)

Sr. Eng.Ind. & Cost

Sr. Engr. Mechanics

Mechanics

Line Insp. Sr. Tech.

Painters

Jr. Engr. Asst. Mech

HelperWelder Fitter

Helper

Helper

HelperTr. Engr.

Line Insp.

Operator

Helper

Production Planning &

ControlThe planning and control of production is one of the important

problems of production management. It is essential that production is

carried on in the best manner at the lowest cost, and the goods are of the

right quality and are produced at the proper time. This can be ensured

only through proper planning of production.

Production control is concerned with direction and guiding

production along the lines set up by the planning department. It

evaluates the actual performance of the productive apparatus in the light

of plans formulated by the planners.

In ATUL AUTO LTD., there is a coordination committee for this

function. It is done in accordance with demand in market. Production

planning is done by the head of the production department. He plans

every thing with the help of supervisors. Production control is all in the

hands supervisors and the head of the production department. Although

the ultimate authority is held by the managing directors and other board

of directors and it is delegated to the head of production department (Mr.

M. H. Desai).

Raw MaterialRaw materials means the materials which are used for the

production process. Raw materials includes the materials obtained from

land forest etc. It also includes semi – finished goods used in the

manufacturing process of any product.

ATUL AUTO LTD., use raw materials like bright bars, steel

sheets, pipes, engine oils, balls – bearings, etc. The unit mostly

purchases these materials from Ahmedabad depo (TATA). It also uses

semi – finished products like headlights, wires, handles. It purchases

these products from various places like Aurangabad, Delhi, Ahmedabad,

& Rajkot.

Production ProcessProduction process is a process of conversion of various to satisfy

the needs of the customers. The difference between the value of inputs

and outputs represents the contribution of the production process. It

converts the raw materials into finished goods and there by increases its

utility.

The production process of three wheeler vehicles produced by

ATUL AUTO LTD., can be described as follows:

In the first phase the aluminum chassis are made with the help of

welding & casting machines. This chassis is the base of the

product. The company maintains a two days stock of these

chassis in the chassis department. So in case of power – failure,

there is no shortage of chassis in the production process.

In the second phase the assembling of various components is

made. They fix the wheels, floor and front show. The front show

of the vehicles is procured from MITASO COMPANY. For

fixing these components, nut balls are used. Which are tapped

with the help of guns. Then spray painting of the front show is

made. At present the spray painting is done manually but they are

planning to use automatic machines for this work in future. The

machine (engine) is also attached in this phase.

The sub – assembly of the machine includes gear box, adapter

and C. C. Plague. The gear box cover is procured from Ambala.

These components are aligned properly with studs and nuts. This

machine (engine) is the most important part of the vehicle.

The next phase includes, passing the units from the manual

trollies to the conveyer belt on which they fix the shaft the

driver’s sear, the front wheels, silencer, driver’s handle,

whippers, breaks, mirrors, etc. After this 75% of the process is

completed.

Now checking us made with the help of testing machines. They

check the wheels, gears, breaker of the vehicles and sought out

the problem if any.

The back part of the vehicle is to be painted in the paint stock.

The surface is painted using painting guns or spray in the paint –

booth. Then it is passed on to the dry – off over for the purpose of

drying at a temp. of 120ºC to 150ºC.

The painted components are moved to the assembling area in

special trolleys. The assembly station is equipped with suitable

fixtures storage arrangement for holding components and suitable

pneumatic assembly tools. Now the entire vehicle is completed.

The assembled vehicles under go a through test of quality control

to maintain the level of quality in the market and the satisfaction

of the consumer.

Plant LocationThe chief object of an industrial concern is to maximize profit

through the minimization of cost of production. This is possible when

the firm is of the right size and is located at the right place. It must be

clearly understood that an optimum location is very much helpful for the

functioning of the industry.

The factors which usually determine the location of industries

may be described as under:

Availability of raw material.

Markets.

Fuel and Power.

Transport Facilities.

Labor.

The ATUL AUTO LTD., is located at Survey No. 86, on

National Highway 8-B at Shapar – Veraval. The firm selected this

location because it is on industrial area and all the facilities like

transportation, labor, raw materials, etc. are easily available.

The plant location of ATUL AUTO LTD is given as follows:

Plant LayoutPlant layout refers to the arrangement of the physical facilities

including production centers for the manufacturing of a product. In

thinking of work improvement techniques, the relationship among

work–centers is one the most important item.

The plant layout of ATUL AUTO LTD. is as follows:

Inventory ControlAll the goods between the receipt of raw materials and the

dispatch of final products to customers are termed as inventory.

Inventory includes raw materials, component parts, semi – finished and

finished products.

Inventory control means control over materials lying in store.

Inventory control keeps continuous track of inventories. Inventory

control aims at the following objectives:

(1) Never run out of anything (Out of Stock).

(2) Never build up a very large inventory.

(3) Never send out too many small costly orders for more.

AUTL AUTO LTD., being an automobile industry, has different

stores department in which there is a systematic storage of inventories

i.e. raw material, semi – finished and finished goods.

These are five different types of stores department in ATUL

ATUO LTD:

(1) General Store.

(2) Tool Store.

(3) Raw Material Store.

(4) Fabrication Store.

(5) Finished Goods Store.

Pollution ControlPollution means to make the environment dirty & impure with

harmful and poisonous substance. The pollution may be air pollution

water pollution, noise pollution, and pollution. Government has now

made compulsory for all the industries to lake measures regarding

pollution control.

In ATUL AUTO LTD., the problem of pollution is nearly nil.

This is because no smoke as produced during the production process.

Also no water or land pollution being caused by the industry. So the

company has received a NO OBJECTION CERTIFICATE from the

government.

Quality ControlQuality Control is the control of quality during the manufacturing

process. Modern economy under competitive market conditions insist of

quality and also cost reduction. A customer in the industrial market

considers quality in relation to price and purpose.

Quality control detects the causes of variations in the

characteristics of products, and indicates the necessary adjustments by

which these variations can be controlled. Thus, “Quality Control is the

systematic control of those variables which affect the excellence

(prescribed norms) of the final product”.

The quality control department of ATUL ATUO LTD., checks

the quality of the goods with the help of equipments like crack –

detector, harness tester, etc. This department checks the quality of raw –

materials and finished products. Not only this it also checks the quality

of at every stage of the production process. The responsibility of

controlling the quality is held by the supervisors of production

department in ATUL AUTO LTD.

Scrap & Waste ManagementThe unnecessary accumulation of absolute, surplus and scrap

items is said to be waste and enough capital is blocked in it. The

increase in all such items will increase the product cost which in turn

will reduce the profits. Therefore efforts should be made manage such

scrap and waste materials.

The firm, ATUL AUTO LTD., has a special scrap yard in which

the scrape from machine shop and fabrication is assembled. This scrap is

weekly collected and sold to a person named Abdulbhai. This is a way

of income for the company.

Stores ManagementStores management is that aspect of material control concerned

directly with the physical storage of goods. The principle function of

stores management is to act as a clearing house for goods i.e. receipt

goods bought and issue of needed materials in the plant against

authorized orders.

ATUL AUTO LTD., maintains a computer online system of their

own for the purpose of stores management. They make entries for each

& every purchase, sale, transfer, goods or materials. This records of

every material starting from purchase to final production and finally to

sale is maintained in this system. The head of stores management is

“Mr. J. Mehta”.

Material HandlingMaterial Handling involves the movement of materials from one

place to another for the purpose of processing. They are moved either

manually or technically with the help of different types of material

handling equipments.

In ATUL AUTO LTD., material handling equipment used is

hydraulic trolley and simple trolley. Simple trolley are more frequently

used while hydraulic trolleys are used to carry very heavy materials.

These trolleys are used to carry materials from one place to another.

CONTENTS

Sr. No. Particulars Page No.

1 Introduction


3 No. of Employees and Shifts

4 Working hours

5 Recruitment & Selection

6 Training & Development

7 Wages & Salary Administration

8 Promotion & Transfer

9 Performance Appraisal

10 Records of Employees

11 Industrial Relations

12 Grievance Handling System

Introduction“The personnel function is concerned with the procurement,

development, integration and maintenance of the personnel of an

organization for the purpose of contribution towards the

accomplishment of the unit’s major goals and objectives.

Personnel management is very important in the smooth

functioning of any kind of organization. Whether it is a manufacturing

firm, a government organization or a non – profit making trust or club.

Man is an active factor of production which controls and co-ordinates all

other factors.

ATUL AUTO LTD., has a separate personnel department of its

own. It considers it as the most important department of the industry.

The personnel manager of ATUL AUTO LTD., is “Mr. M. H. Desai”.

Organization StructureAn organization structure indicates relationship between the

employees of an industrial undertaking. It indicates a clear relationship

between authority and responsibility for the employers.

In order to solve the problems of the personnel department

efficiently and in a responsible manner it has become necessary to

establish a separate. Personnel Department in the organization. It shall

be responsible for performing all the personnel functions efficiently

establishing sound and effective personnel policies practices and

programs and taking unbiased decisions in the interest of the labourers.

ATUL AUTO LTD., has a separate personnel department as

follows:

Chart of Personnel

Department

M.D.

J.M.D.

Manager (P&A)

Asst. Manager (P&A)

Sr. Assistant Jr. Assistant

Bus/Car Driver Time Keeper Reception Sec. Guard

Peon

No. of Employees and ShiftsThe number of employees indicates the total employees working

in the firm for all the shifts. There are in all 360 employees in the

company.

Generally, there is one shift for the employees. But if there is

overload of work then there is an extra – shift (which is in a very rare –

case).

Morning Shift: - 9:00 a.m. to 1:00 p.m.

Afternoon Shift: - 1:30 p.m. to 5:30 p.m.

Extra Shift: - 6:00 p.m. to 9:00 p.m.

Working HoursThe company has a standard time keeping system for working

hours. The employee works for 8 hours regularly from 9:00 am to 5:30

p.m. It required they work for extra 3 hours from 6:00 p.m. to 9:00 p.m.

The workers or employees generally do not require working overtime.

The time discipline is well maintained in the company. Time –

punching machines are placed. Which, are attached with the computer.

Each employee is given a card. Which is to be punched in the punching

machine as and when he enters & leaves the factory or working place.

This all the records of every employees are received through computers.

Recruitment & Selection“Recruitment is the process of development and maintenance of

adequate manpower resources. It is the positive process of

employment”.

The success of any organization depends upon the skill of its

employees. Os the process of recruitment plays an important part in the

success of the unit.

In ATUL AUTO LTD., the recruitment of general managers &

above staff is made through newspaper advertising or through

NAUKARI.COM site. While the recruitment of functional staff,

supervisory staff, computer operators etc. becomes very easily because

the company receives daily application for these posts. They, have their

data book for all the applications.

Selection“Selection is the process in which candidates for employment are

divided into two classes, those who are to be altered employment and

those who are not”.

ATUL AUTO LTD. carries out the selection process to appoint

only these persons who are suitable for the job and have better abilities

for selection various instruments such as the aptitude test, interviews are

used.

Selection Procedure(1) One-day trial.

(2) Personnel Discussions (interviews)

(3) Final Selection.

(1) One – day Trail: -

In this stage the person applying for the job is asked for

operating the grinding machine or any other machine to see his

skill.

(2) Personnel Discussions (interview): -

In this, the person is asked technical questions by

personnel department head, which he has to answer based on his

knowledge and experience.

(3) Final Selection: -

The final selection is made by personnel manager and

concerned department head. They select employee on the basis of

their qualification, experience & skills.

Training & Development“Training is the act of increasing the knowledge and skills of an

employee for doing a particular job”.

It is a systematic program of the organization which aims at

increasing the aptitude skills, and ability of the workers to perform their

specific jobs. By training, the employee will acquire the new skills,

technical knowledge, problem solving ability etc.

At ATUL AUTO LTD. the workers are trained under the

guidance of the senior worker of the concerned department or by the

training engineer. A training of 1 week is given to the worker and then

he is taken as a permanent employee of the company.

For the development of the present employees also trainers are

called from Ahmedabad. The company’s training officers also play a

major role for the development of the employees in the way of progress.

Wages & Salary

Administration“The compensation rendered to the employees of an organization

in return for the kind of job done or service rendered is known as wage

or salary”.

At ATUL AUTO LTD. the salaries that are above 4000 Rupees

are paid through cheques of HDFC, SBI & ICICI.

While salary below Rs.4000 are paid in cash between the dates of

1 to 7 of the month.

The workers get 20% bonus every year from the company. They

also get on increment in their salaries every year from 1st April. Thus the

wages & salaries administration of the company is well maintained.

Promotion & Transfer

Promotion“The term promotion refers to the upward shifting of a personnel

where his salary status responsibilities and authorities will be higher

than before”.

In ATUL AUTO LTD. there is 0 policy to give promotion to 1 or

2 employee from each department every year. Promotion is given on the

basis of departmental head’s recommendation. They recommend to the

directors and the directors take the final decision for promotion. The

important factors which are considered for promotion of an employee

are his experience, performance and skills.

Transfer“Transfer refers to the horizontal shifting of an employee without

any change in the salary, status, responsibilities and authorities of the

employee”.

In case of transfer policy, ATUL AUTO LTD. does not feel the

need to have one. An employee is not transferred under general

circumstances but in some cases like if a skilled worker is needed at one

sales branch at a place, then the worker is provided from other place to

satisfy the branch’s need.

E.g.: -

If there is shortage of a service engineer in Andhra Pradesh. Then

a person is transferred from Maharashtra to Andhra Pradesh for

this reason.

Performance Appraisal“The performance appraisal system is the process of evaluation of

an employees performance on the job in terms of its requirements”.

At ATUL AUTO LTD. the performance of an employee is

measured from time to time taking into accounts his work during the

year, his period of service, his behavior with other employees and heads,

his time discipline etc.

The process of performance appraisal is beneficial both from the

point of view of the company to maintain discipline among the worker

and from the point of view of workers for their self – development.

Records of EmployeesThe personnel department of the unit is assigned the task to

maintain up-to-date records of the employees of the organization.

At ATUL AUTO LTD. a records of all the employees are

maintained including their past experience, certificate of age, group, last

qualification, additional trainings (if any), etc. The record is maintained

till 5 years after the employee leaves the job.

These records are kept by head of the personnel department.

Grievance Handling SystemGrievance, as defined by the international labor organization is

“A complaint of one or more workers in respect of wages, allowances,

conditions of work and interpretation of service stipulations, covering

such areas as overtime, leave, transfer, promotion seniority, job

assignment and termination of service”.

The administrators of an organization put in their best efforts in

the formulation and implementation of the policies, programmes and

procedures which would best enable them to handle employees

grievances. These policies, programmes and procedures are generally

known as grievance handling procedure or system.

In ATUL AUTO LTD. the procedure for grievance handling is

fixed i.e. whenever a grievance arises among workers, firstly it is

handled by the departmental head. If he fails to solve it the problem goes

to the personnel head and if he too fails in the settlement of that

grievance the board of directors have to handle the case.

It for instance, a worker’s behavior is undesirable, he is first

given an oral notice regarding it. If he doesn’t improve, he is given

written notice and even if he fails in improving himself, he is given

transfer or demotion and finally he is terminated if he remains the same.

This is now Grievance Handling System in ATUL AUTO LTD. works.

Industrial RelationsThe term “Industrial Relations” is used to refer to the relations

between the parties concerned with industry. The two parties which

come into direct contract with each other are the workers and the

management representing the employee. Both the parties have a

common interest in industry and yet there are various occasions when

there is difference of opinions among them.

In ATUL AUTO LTD., there is an environment of peace and

harmony among the workers and employees. So these is an absence of

any trade unions in the company as it is not required.


1 Introduction


3 Market Segmentation

4 Market Research

5 Products & Product Related Strategies

6 Pricing Policies

7 Promotion Mix Advertising

8 Channels of Distribution

9 Exports

10 Competitors

IntroductionMarketing occupies an important position in the organization of a

business unit. As traditionally defined “Marketing consists of these

efforts which effect transfers in ownership of goods and care for their

physical distribution”.

F.E. Clark

The above definition of marketing is a description of the physical

activities involved in the process of distribution of goods. However

marketing is more than a mere physical process or a set of activities.

The purpose of a business is to create a customers. “Marketing is

the function of business concerned with the creation of a customer”.

Peter Drockes.

Thus the modern concept of marketing focuses on the

“Consumer” and the satisfaction of his needs.

Organization Structure

Chart of Marketing Department

M.D.

J.M.D.

G.M.

Zonal Manager (NW)

Zonal Manager (CZ)

Zonal Manager (WZ)

Zonal Manager (SZ)

Zonal Manager (EZ)

Area Manager Area Manager

Sales Officer

Service Engr.

Sales Officer

Service Engr.

Area Manager Area Manager

Sales Officer

Service Engr.

Sales Officer

Service Engr.

R.O. E+E Sr. Asst. Sr. Mgr. (S&S)

Ast. Sales Comp. Optr. Sr. Engr.

Dirver Jr. Engr.

Peon Supsr. Sr. Asst.

Mech. Jr. Asst.

Helper Helper

Market Segmentation“Market Segmentation is the process of taking the total

homogeneous market for a product and dividing it into several but

markets and segments”.

The process of market segmentation can be carried out on the

basis of geographical area age, sex and personal preference of the

customer etc.

Market segmentation in ATUL AUTO LTD. is not done. The

company is having only one segment. Hence segment wise bifurcation is

not required to be given.

Market Research “Marketing Research is the systematic recording and analyzing

the data relating to the marketing of goods and services”.

Marketing research is the branch of marketing information

system. The term market refers to the actual & potential consumers.

ATUL AUTO LTD. has a special R & D department (Research &

Development) which carries out market research for the following

purposes:

It provides them with the information about the needs wants and

performances of the consumers.

It provides them the information regarding the current demand

analysis in the market. So as to predict their sales fore cast.

It helps them in the fixation of the prices of their products.

It helps them to modify their products according to the current

trends and preferences of the customers.

Products & Product Related

Strategies“A product is anything that can be offered to a market for

acquisition, use or consumption that might satisfy a want or need”.

In marketing management, product planning is the first and most

important step in the process. It occupies an important place as it is fully

under the control of the organization. A good product can set the game

of market capturing in favor of the company.

The products of ATUL AUTO LTD. may be divided under two

categories passenger and loading. They are available in RTO’s fix

colors i.e. Grey & Yellow.

(1) Passenger: -

6 Passengers + 1 Driver.



(2) Loading: -

Delivery Van.

Pick up Van Highdeck.

Pick up Van Standard.

Tipper.

Chicken Carrier.

Water Tanker.

Soft Drinks Carrier.

Mobile Shop.

These vehicles are available in various colors viz, Yellow, Red,

Blue, etc.

In today’s highly competitive world. ATUL AUTO LTD. has set

up product planning on the basis of market demand. Competitors and

other factors.

Pricing PoliciesAn important function closely allied to selling is that of

determining the price policy to be followed by a concern.

At ATUL AUTO LTD. the pricing decisions are taken by the top

level management. The company does not adopt any specific pricing

policy but it keeps the following factors in mind while pricing its

products:

Cost of production.

Prices of its competitors.

Normal profit.

Cost of advertisement.

Cost of transfer & distribution.

Taxation.

Dealer’s Margin.

For pricing their products in international markets the company

takes into account the following additional factors into consideration.

Export packing costs.

Market condition of that country.

Export duties.

Cost of preparation of export documents.

Promotion Mix Advertising“Promotion consists of a diverse collection of effective tools,

mostly short term, designed to stimulate quicker and / or greater

purchase of a particular product”.

During festivals like Diwali, Janmashtami, etc. ATUL AUTO

LTD. offers free mobiles, T.V’s, DVD’s etc. for the purpose of their

products promotion.

AdvertisingAdvertising is a non-personal communication advertising may be

made throw newspapers, pamphlets, TV, Radios, etc.

Advertising is one channel of information for consumers. They

get to know about new products, product improvements, price changes,

packaging innovations, special credit term’s and so on from advertising.

ATUL ATUO LTD. have chosen newspaper and their primary

mode for advertising. The company selected this mode because

newspapers are affordable also to the lower & medium class people who

are their main customer. Also they advertise their product in the regional

language for the convenience of their customers.

Besides they also use holdings and pamphlets for the purpose of

advertising.

Channels of DistributionThe term “Channels of Distribution” is used to refer to the

various alternative link roads which connects the producer with the

consumer. The possible paths by which products may be channelised to

the consumer are varied in number and character.

The company ATUL AUTO LTD. follows a simple channel of

distribution:

Manufactures

Main Dealers

Sub – Dealers

Customers

Thus, the products manufactured by then are sent to the main

dealers at various states. Then the sub – dealers and finally to the

customers.

ExportsThe products of a company when sold in the markets or foreign

countries are known as exports. It helps in increasing the foreign

exchange of a country. Thus, the export activities plays a significant role

in the economic upliftment of a nation.

The company ATUL ATUO LTD. supplies its vehicles with

brand name “ATUL SHAKTI” in an African Country Nigeria. It

supplies 50 vehicles to a transport agency in Nigeria. This agency uses

this vehicles mainly for transportation or as load carrier.

The company with its brand name “KHUSHBU” has exported in

Asian and African Countries.

CompetitorsThe competitors play an important role of the functioning of the

unit and prices of the products. The competitors of ATUL AUTO LTD.

are:

Bajaj

Piojjio

Scoter India Ltd.

Local Manufacturers like Pals, etc.


1 Introduction


3 Financial Planning

4 Capitalization

5 Capital Structure

6 Fixed Capital Management

7 Working Capital Management

8 Receivables Management

9 Cash Management

10 Profit & Profitability

Introduction“Financial Management is concerned mainly with such matters as

how a business unit raises its finance and how it makes use of it

efficiency”.

- Hogland.

In simple words, it means raising of adequate funds to the

minimum cost and using them effectively in business. It is mainly

concerned with the financial problems of the business.

The finance department has to cover a long range of functions

such as maintaining adequate funds on hand to meet expenses of both

revenue and capital nature. Smooth availability of finance for running

the enterprise and easy availability of finance for the expansion of the

business as and when needed, determine the success of the financial

management.

A’s of Financial Management

Anticipating Financial Needs.

Acquiring Financial Resources.

Allocating Funds in Business.

Administrating the Allocation of Funds.

Analyzing the Performance of Funds.

Accounting and Reporting to Management.

Financial Management

Organization Structure

Chart of Finance Department

M.D.

J.M.D.

G.M. (Finance)

Sr. Manager (Accounts)

Asst. Manager (Acct.) Asst. Manager (Excise)

Sr. Asst. (Excise)

Jr. Asst. (Excise)

Sr. Asst. (Acct.) E.D.P. Officer

Jr. Asst. (Acct.) Comp. Optr.

Comp. Optr.

Peon

Financial PlanningFinance is undoubtedly the life – blood of the business. The

ambitious plans of a businessman would remain mere dreams unless

adequate money is available to convert them into reality.

One of the most important function of the financial manager is

that of planning.

“Financial Planning is mainly concerned with the economical

procurement and profitable use of funds which is characterized by

realistic investment decisions”.

The company ATUL AUTO LTD. gives good weitage to

financial planning to facilitate the availability of funds at the right time

to meet their demand for capital both fixed as well as working.

The company, ATUL ATUO LTD. prepares a financial plan

keeping in view the following points:

Amount needed for working capital.

Cost of fixed assets and their maintenance.

Amount to be kept aside for salaries and wages.

Amount to be paid as bonus.

Other office expenses.

Cost of maintenance of vehicles.

Amount to be kept aside for contingencies.

Capitalization“Capitalization comprises of a company’s ownership capital

which includes capital stock and surplus in whatever form it may appear

and borrowed capital which consists of bonds or similar evidences of

long term debts”.

- Gerstenbug.

If capitalization of a company is just equal to its requirements it

is considered to be properly capitalized. If it is more than required, it is

considered to be over-capitalized. Similarly if the capital is less than the

required amount, it is said to be under capitalization.

The capitalization of ATUL AUTO LTD. is as follows:

Authorized Capital: -

80,000,000

Paid up Capital: -

53,515,200

Capital Structure“Capital Structure of a Company refers to the make-up of its

capitalization”.

- Gerstenberg.

However, in a broader sense, capital structure includes all the

long-term capital including loans, debentures, bonds, share issues,

reserves, etc. and the components of the total capital.

In simple words, capital structure refers to the composition of

capital in on organization. ATUL AUTO LTD., has acquired their

capital by issue of share capital but it has not issued any preference

shores or debentures.

The capital structure of ATUL AUTO LTD. is as follows:

Share Capital 55,844,050

Reserves & Surplus 144,149,373

Secured Loans 112,784,313

Unsecured Loans 57,813

Fixed Capital ManagementCharles Prather says that “Fixed Assets are those which of a some

what fixed or permanent in nature and are used by the business in its

normal operations, they do not include items offered for sale”.

Fixed Assets (capital) management is the most important task

which a management has to face in its day-to-day situations fixed assets

includes land, machineries, office building, vehicles, and other

equipments used by the enterprise.

The details of the fixed assets owned by ATUL AUTO LTD. are as

follows:

Particulars Net Block

Land 4,659,821

Factory Building 26,817,994

Building 13,801,111

Plant & Machinery 48,316,152

Furniture 4,070,856

Vehicles 2,826,357

Other Assets 435,204

Windmill 53,575,833

Lease land (for windmill) 1,00,000

Grand Total 154,603,328

Working Capital

ManagementIn accounting, “Working Capital is the difference between the in

low and out low of funds. It is defined as the excess of current assets

over current liabilities and provisions”.

Thus it can be said that:

Net = Current – Current Working Assets Liabilities Capital

At ATUL AUTO LTD. the following currents form its working

capital:

Particulars Amount

Current Assets

Inventories

Sundry Debtors

Cash & Bank Balances

Loans & Advances

72,306,020

62,934,110

11,441,798

56,145,885

- Less Liabilities & Provisions 55,061,055

= Net Working Capital 147,766,758

Receivables ManagementReceivables are the assets which are created as a result of the sale

of goods or services in the ordinary course of business. These are known

as “accounts receivables trade receivables or customer receivables”.

The following is the amount of receivable i.e. debtors in ATUL

AUTO LTD.

Sundry Debtors = 62,934,110

Cash ManagementCash Management is one of the key areas of working capital

management. Apart from the fact that it is the most liquid current asset,

cash is the common denominator to which all current assets can be

reduced because the other major liquid assets i.e. receivables and

inventory get eventually converted into cash. This underlines the

significance of cash management.

The term cash with reference to cash management is used in 2

senses. In a narrow sense it is used to cover currency & generally

accepted equivalents of cash such as cheques, drafts, demand deposits in

banks, etc. The broader view of cash also includes near cash assets such

as marketable securities and time deposits in banks.

Cash on hand and balance in bank is one of the most important

elements in day to day business life. So different balance of cash is

important to maintain on hand.

ATUL AUTO LTD. has following cash and bank balance as on

31st March 2005.

Cash on hand: - 317,031

Bank Balance: -

With scheduled bank in Current A/c. 10,004,477

With scheduled bank in deposit A/c. 1,052,877

With other banks in current A/c. [Citizen

cooperative bank Ltd.]

1,973

With other banks in deposit A/c. [Citizen

cooperative bank Ltd.]

65,438

11,441,797

ATUL AUTO LIMITED

BALANCE SHEET AS AT 31st MARCH 2005

Particulars Sch

.

No.

As at 31st

March 2005

(Amount in Rs.) As

at 31st March 2004

A. SOURCES OF FUNDS

(a) Share Holder’s funds

Share Capital

Reserves & Surpluses

Sub Total

(b) Loan Funds

Secured Loans

Unsecured Loans

Sub Total

Deferred Tax Liabilities Net

Total

1

2

3

4

5

55,844,050

144,149,373

199,993,423

112,784,313

57,813

112,842,125

22,200,537

335,036,085

55,844,050

114,024,310

169,868,360

54,158,315

2,089,702

56,248,017

15,526,805

241,643,182

B. APPLICATION OF

FUNDS

Fixed Assets

Gross Block

Less: depreciation

Net Block

Working in progress6

203,357,908

48,754,580

154,603,328

9,706,000

164,309,328

125,716,115

40,935,687

84,780,428

1,827,262

86,607,262

Investments

Current Assets loans and

Advances

Inventories

Sundry debtors

Cash and bank balances

Loans and advances

Sub Total

Less: Current liabilities &

provisions

Net Current Assets

Total

Notes on A/c. & Significant

accounting policies

7

8

9

10

11

12

13

22,960,000

72,306,020

62,934,110

11,441,798

56,145,885

202,827,813

55,064,055

147,766,757

335,036,085

22,960,000

44,415,465

50,967,303

23,814,848

49,948,717

169,146,333

37,075,840

132,075,493

241,643,182

Profits & Profitability’sThe main purpose of any business unit is to earn profit. Profit is

the motivating force for business. It is a yard stick of efficiency in

business.

Profit is earned by selling a product at a higher price than its

purchase price. In the absence of profit the closure of business is

imminent.

In ATUL AUTO LTD. besides other motives such as fulfilling

social responsibilities, providing employment, maintaining prestige etc.

profit is kept as the main & primary motive.

The profits of ATUL AUTO LTD. has been increasing reasonally

beginning.

Following is the chart showing profit after taxes & turnover of

ATUL AUTO LTD. for the last 5 years:

PAT – Profit After Taxation.

SWOT AnalysisSWOT analysis means the Strength, Weakness, Opportunities and

threats of the company. The same for ATUL AUTO LTD. is given as follows:

1 S (Strength) The strength of ATUL AUTO LTD. is that

the prices of the products of this company

are comparatively less than its competitors.

So they are able to sale on a large number.

2 W (Weakness) Weaker quality material used in their

products is the major weakness of the

company, which they are trying to

improve.

3 O (Opportunities) They have started dealing in 4-wheelers

and also planning to introduce LPG and

CNG based vehicle which has a bright

future.

4 T (Threats) The threat for the company is that as there

is an open market in India today, the entry

of any ‘American or other country’s

company may prove harmful for the

company.

Future PlansThe future plans of ATUL AUTO LTD. is as follows:

Expanding their markets in four wheeler goods carriers.

They are signing a contract with a Chinese company for the

supply four wheeler goods carrier.

They have a target to produce 5000 units per month before 2010.

SUGGESTIONSThe company has an excellent administration set up and do not

feel necessary to suggestions.

However, here are few suggestions to the company:

The company should advertise its products broadly to increase

sales.

The company should bring the latest technological up-gradation

in its vehicles.

The company should try and provide fuel – efficient vehicles at

affordable prices.

The company should try to reduce the noise and air pollution

caused by its product “KHUSHBU ROAD MASTER”.

CONCLUSIONATUL AUTO LTD. has an all together different outlook in

competitors.

After the completion of my industrial visit at ATUL AUTO LTD.

I would like to conclude that the working of the company is must helped

by excellent panel of administrators.

The level of efficient administration and maintenance sets a

goods example for other in the automobile industry and the company

promises itself a bright future by hard work & communicate. The

company thus plays a significant role in the economic development of

India.

BIBLIOGRAPHY

Organization and Management

- Dr. C. B. Cropta

Modern Business Organization and Management

- S. A. Sherlekar.

- V. A. Sherlekar.

Fundamentals of Business Organization and

Management

- Y. K. Bhushan.

Financial Management

- P. V. Kulkarni.

- B. G. Satyaprasad.

atul auto limited-2

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