[Type the document title]EXECUTIVE SUMMARY

The study is undertaken in Telcon Ltd. Dharwad It is a summer training wherein an attempt has been made to understand the management of the company and how the work has been undertaken so as to get an insight into the management. The internship was from 23th March 2015 to 23th May 2015, during the project I had the privilege of being guided by Mr.Anil (Finance officer at Telcon Ltd) This research is based on .. in Telcon Ltd. Dharwad. This was one of the primary objectives of the study apart from the other objectives while analyzing company collection efforts and liquidity. The study was conducted through the annual reports of the company and personal interview with the personnel of the company. The findings were analyzed and interpreted based on the study some suggestions are given.

INDUSTRY PROFILE

ABOUT CONSTRUCTION EQUIPMENT INDUSTRYConstruction equipment industry is going to grow significantly; 20% to 30%, i.e., the kind of industry estimate of growth over the next five years. Most of the international Construction equipment companies already exist in India, for example Caterpillar, Volvo, JCB and others. These companies have invested heavily in the form of establishment to cater the needs of the Indian market.Komatsu, which is also one of the top five players in the world, is having 50-50 joint venture with L&T. There are some rumors that L&T may surrender, or sell its 50% equity stake to Komatsu to make it as a 100% Komatsu unit. Therefore, knowing the completion and the significance of this market, Hitachi was very keen to be a partner with TELCON and take a slightly higher equity stake.Telcon & HITACHI agreed upon in terms of sourcing the components and machines from Telcon by Hitachi for its global distribution network. They would be also bringing some technology by setting up the product development laboratory and enhancing capability in India jointly with Telcon. They were quite impressed by Tata Motors ERC facility in Pune as well as in Jamshedpur, and they would like to set up similar kind of a facility for construction equipment in India which will be not only meant for the Indian market but also to a large extent meant for their global operations, especially in the areas of design and development where they would like to cooperate and work with Tata Technology.

INDUSTRY OVERVIEWConstruction Equipment industry recorded about 45% growths in the year 2008-2010, continuing its similar growth rate during the previous year. During the year, the countrys economic condition indicated high GDP growth, strong rupee; controlled inflation and soft interest rates, followed by increased demand for industrial and consumer product.After a few ears of sustained growths, the world economy was hit by the subprime crisis and slowdown dramatically in the year 2008-2009. The Indian economy which was growing rate of over 8% for over period of five year felt the tremors of the slowdown quite rapidly in the latter half of the year following the bankruptcy of Lehman brother in September 2008 causing a drop of almost 3% in the growth rate the bellwether index of industrial production (IIP) should a marred decline in outputs also the global financial meltdown had a teaching effect on the financial sector in the country and the flow of credit to the customers of the construction equipment (CE) industry showed great sluggishment with the impact to the end customers in the form of: Interest rates hikes. Increased margin money requirements. Stringent credit checks. A total lack of risk appetite.The imports of global developments on India contributed to a market contribution of 24% for Excavators, and pronounced fall of over 45% in the Backhoe loaders. In addition, the whole of the CE industry slowed down dramatically with investments dropping off postponement or shelving of number of infrastructure projects due to heightened uncertainty. In addition, many ongoing projects witnessed low level of activities on questions of financial viability though the stimulus packages announced by the government gave some respite.Situation affected mining sector too, after fall in global demand for iron ore and the consequent decline in exports. There was however, a sustained activity in the power and coal sectors where there was only a managerial fall.

COMPANY PROFILE

COMPANY PROFILETata Hitachi construction machinery company ltd, the leader in construction equipment in India enhances the operational performance of its customers, leading to improving their profitability and competitiveness by offering constructive solutions. Tata Hitachi is a subsidiary company of Hitachi Construction Machinery Co. Ltd., which holds 60% share, and Tata Motors Ltd holding the balance 40%. The company commenced manufacturing of construction equipment in 1961, as a division of TELCO. In 1984, it entered into a technical collaboration with HCM, Japan for manufacturing state of the art hydraulic excavators. Tata Hitachi is focused on capitalizing the opportunity in the domestic arena for which the key market segments are Excavators, Wheeled Products, Cranes and Others. Tata Hitachi's consistent growth and success have been built on the foundation of our ability to understand customers' needs, provide Equipment, and Support solutions that increase profitability and competitiveness for them. What we call Reliable Solutions. Our capabilities to deliver Reliable Solutions starts with our comprehensive range of Equipment that ensures that the customer has exactly the right kind of equipment for all Mining, Infrastructure, Construction and Agricultural needs. The construction industry involves heavy use of excavators, wheel loaders, and backhoe loaders. Tata Hitachi's ranges of excavators starting at 2 tonnes with a maximum size of 120 tonnes are made in the country. Tata Hitachi is one of the largest manufacturers of construction equipment in the country and has three manufacturing plants - at Jamshedpur in Jharkhand, at Dharwad in Karnataka and at Kharagpur in West Bengal. It also has a full fledged Design and Development set-up for developing indigenous and collaborated equipments. Hitachi is actively participating in creating the new R&D facilities at Kharagpur with the aim to make the new centre a global R&D hub. Our endeavor to provide Reliable solutions is enabled by our widespread network. Tata Hitachi Dealers provide support to the customers through parts and expert service. Tata Hitachi takes pride in its marketing and service network of 230+ touch points that enables it to have one of the largest distribution networks in the country. Our focus is also on value added Service offerings such as Full Maintenance Contracts, which complete our package to our customers and enable him free up precious resources for his core activities. Specialized reconditioning and refurbishing services are offered to ensure that the utility of the equipment is extended and life cycle costs brought down.Industry NameTELCON Construction Equipment Co., Ltd.,

Year of Incorporation1999

Registered OfficeKIADB Plot # 2, Belur Industrial Estate, Garag Road, Mummigatti, Dharwad 580007.

Business TypeManufacturing

Telephone No91-0836-6452880

Fax No91-0836-2486907

Joint VentureHitachi, Japan

BankersState Bank of India HDFC Bank Ltd., Corporation Bank, Standard Chartered Bank.

AuditorsS.B Billimoria & Co.,

Company SecretaryA Azhagesan

Total revenue1300 crore

WorksJamshedpur, Dharwad

BACKGROUND AND INCEPTIONTelcon has been at the forefront of providing Constructive solution to the Indian Construction, Earthmoving and Mining Industry. Started in 1961 as a division of Telco (now Tata Motors), Telcon is an independent subsidiary of Tata Motors and a Joint Venture between Tata Motors & Hitachi Construction Machinery Co. Ltd. Of Japan world leaders in Hydraulic Excavators Technology. Telcon has the widest range of construction equipment catering to the needs of various end use sectors and holds a dominating presence in the construction equipment market in India the portfolio equipment range includes Hydraulic Excavators, Mining Shovels Backhoe Loaders, Wheel Loaders, Vibratory Compactors, Motors Graders, Crawler Cranes, Asphalt Plants, etc. Apart from manufacturing world-class machines with cutting edge technology at Jamshedpur & Dharwad, Telcon has a well designed backup system to cater to the Support Needs of the customers. With a wide network of over 50 front offices in the form of Dealer and Telcon offices, the resultant reach ensures prompt service to customers both on account of Spare Parts & Breakdown Repairs. In addition, Telcon offers various value added services like On Site Maintenance Contracts, Unit Exchange Programs, and Aggregate Repairs at Telcons endeavor and objective to provide pro-active & constructive solutions with a view to continuously improve competitiveness & profitability of its valued customers. This spirit, hence, forms the Telcon Brand-Construction Solutions.

TELCON-DHARWADInitially the manufacturing unit of Telcon was setup only in Jamshedpur but later an additional plant of Telcon was setup in Dharwad because the availability of land at lower cost and also transportation cost of the finished goods was reasonable and there is good market of their product in southern India.Telco Construction Equipment Company Ltd. Is situated in Belur Industrial Estate in Dharwad. Telcon was incorporated on 30th March 1999 and commenced its commercial by the company is 118.75 acres. It is joint venture of Tata group and Hitachi construction company Ltd.Joint venture with Hitachi-a world leader in hydraulic excavator technology, Telcon has access to the very latest and is able to bring excellent products to the discerning Indian customers. The manufacturing facilities are in accordance with Hitachi standards and stipulations and the Tata policy of quality ensures that only the best machines roll out. Telcons facilities located in Dharwad in Karnataka and Jamshedpur in Jharkhand are strategic locations with proximity to the markets of the respective products manufactured in each region.It is the younger of the two facilities having been set-up in 1999 this modern and highly mechanized facility spread over 118 acres rolls out more than a thousand machines with less than 50 workers in each shop.It has fully automated conveyor system, which is designed to cater to high volumes and is undaunted by the flexibility and fluctuations in the model mix. This gives it the capability to respond nimbly to customer needs. Systematic workflow and a quality conscious team ensure that high quality products roll out. The harsh conditions that prevail on a field site, makes the equipment susceptive to damage and corrosion. So the machine that rolls out of Dharwad receive an Autophorective Pretreatment, oven banking, allowed by PU-based painting, a process unique to the Indian Construction and Earthmoving Equipment industry. This makes the machines corrosion resistant and gives them a superior finish.All equipment and key components undergo a rigorous testing routine that ensures that the equipment is fit for use immediately after commissioning and secures a long and trouble free life for them.

NATURE OF THE BUSINESS CARRIEDEarthmoving is the planned, progressive modification of the natural earth surface to give it a profile matched to a proposed engineering structure or use the material for processing. While this is the more macro view of earthmoving and its importance to humankind more specifically, the term Earthmoving is related to construction (dams, roads, etc.) land clearance; making of canals; mining and quarrying, etc.Infrastructure development is the key to spurring business growth, generating employment and giving an overall thrust to the economy of nation. Quality construction equipment can power the development process by helping to cut costs and by ensuring timely completion of projects.Telcon is in the field of designing, manufacturing, assembling, selling, distribution and dealing in all service related to earth moving machinery and construction equipment with manufacturing facilities at Jamshedpur and Dharwad and a marketing and service network covering 65 towns in the country. Its product includes hydraulic excavators, crawler, cranes, wheel loaders, backhoe loaders, dumpers and motor graders.

VISION, MISSION AND QUALITY POLICYVISION: Reliable Solutions for Building a Greater TomorrowMISSION: Be the preferred partner for providing reliable solutions for mining and infrastructure sectors. While dominating the domestic market, we will become a global manufacturing and development hub. Our hallmark shall be our motivated people, customer-centric culture, superior technologies, and strong partnerships, all working safely in unison with environment and society.QUALITY POLICY:Tata Hitachi Construction Machinery Co. Ltd is committed maximizing customers satisfaction and delight. It will strive to achieve this goal by continues improvement of its design and development; manufacture; sales and services of its products. It will also ensure that its product is reliable, safe, environment friendly and cost effective and its services are of the highest order. Tata Hitachi Construction Machinery Co. Ltd also has a commitment to words improving the quality life of its employees, both within and outside its plants and offices, it will strive to achieve this through the continues improvement of its work practices and community initiative.

CORPORATE SOCIAL RESPONSIBILITY Tata Hitachi (THCM) has identified Corporate Social Responsibility (CSR) as on one of the Key Business Process. Tata Hitachi is committed to improving the quality of life of its identified communities located in and around the units of its operations. It shall strive to achieve this through periodical assessment of the needs of its communities and the continuous enrichment of the initiatives, designed to facilitate a process through which Tata Hitachi and its communities shall work as equal partners of social development. Tata Hitachi shall also strive to provide opportunity to its employees to volunteer their managerial, technical and specialized skills and services in order to enrich their lives, as well as to enable the company achieve its stated social responsibility of building strong communities, in creating a sustainable environment in and around its facilities.TATA HITACHI PHILOSOPY and VALUES1. Ethical behavior Integrity Credibility Transparency 2. Customer orientation3. Ability speed and competitive urgency4. High performance culture5. Innovation6. Meritocracy7. Team work as well as respect for individual8. Fact based9. Socially responsible

PRODUCTS AND SERVICE PROFILEThe portfolio of equipment range includes Hydraulic Excavators, Mining Shovels, Backhoe Loaders, Wheel Loaders, Vibratory Compactors, Motor Graders, Crawler Cranes, Asphalt Plants, etc.

Telcon has the blend of manufacturing world-class machines with cutting edge technology as well as designed back up system to cater to the support needs of the customers. Telcon has a wide network of over 50 front offices in the form of Dealer and Telcon offices across India. This has brought Telcon more closely to its customers as they can avail Spare Parts Support & Breakdown Repairs easily.In addition, they offer various value added services at Telcons own workshops and Comprehensive Refurbishing of machines like. On Site Maintenance Contracts Unit Exchange Programs Aggregate RepairsIt is Telcons endeavour and objective to provide pro-active & constructive solutions with a view to continuously improve competitiveness & profitability of its valued customers. This spirit, hence, forms the core of the Telcon Brand-Constructive Solutions.PRODUCT PROFILETELCON Construction Equipment Co., Ltd. engages in the design, manufacture, and supply of construction equipment. Its products include hydraulic excavators, crawler cranes, wheel loaders, backhoe loaders, off-highway dumpers, wheeled equipments, road making equipments, motor graders, skid steer loaders, cane loaders, and truck loader cranes. The companys products are used for agriculture, construction, infrastructure, and mining applications. It supplies its equipment in India, as headquartered in Bangalore, India. TELCON Construction Equipment Co., Ltd. Operates as a subsidiary of TATA Motors, Ltd.AREA OF OPERATIONThe company has used state-of-art technology to manufacture excavators and backhoe loaders. It enjoys a 90% share of the crawler crane market in India. The only Indian manufacturer produces 100 tone cranes. These are the largest machines made locally. The company was the first to introduce mini excavators in India, and its brand EX 60 is the most successful machine to be made in India so far with more than 1300 machines being sold in the last three years. It is the largest manufacturer of hydraulic excavators in India with over 6000 machines in the market. It offers the widest available range of hydraulic excavators, eight models ranging from two tonnes to sixty tonnes in size.OWNERSHIP PATTERNTelcon Construction Equipment Company Limited (TELCON) is a 60:40 joint venture company between Tata Motors (earlier known as TELCO) and Hitachi Construction Machinery Company Limited (HCM).HCM has increased its stake in TELCON from 20% to 40% on 9th Dec 2008 by an agreement. This agreement was made with a view to expand the scope of co-operation and partnership between Tata Motors and HCM.HCM is a leading Construction Equipment Manufacturer with a turnover of around US $ 5 billion. Widely accepted as the foremost in excavator technology, HCM has its own manufacturing operations in Japan, China, Indonesia, and Netherlands, France and USA and worldwide distribution network. Their participation reflects their confidence in the fast growing Indian market and their desire to be a part of the infrastructure building in the county as also to strengthen the relationship with the Tata Motors.CUSTOMERS OF TELCON Major constructors Builders Contractors Land scrapperCOMPETITORS OF TELCON CATERPILLAR BEML ESCORTS HINDUSTAN MOTORS L&T (Larson & Turbo) VOLVO

INFRASTRUCTRAL FACILITIESTELCON is constantly raising and introducing new facilities to meet overall needs of the company. Both the plants at Dharwad and Jamshedpur are equipped with modern infrastructure facilities.To give an insight into the infrastructure facilities, following are some of the important features: Video conferencing facility was extended to Dharwad plant in order to have better communication between two plants and the corporate office at Bangalore. An in-plant facility was introduced in the companys Dharwad plant to give a strategic partnership with vendors. The transmission subassembly operations for the above product were successfully shifted from Jamshedpur to Dharwad plant.

ACHIVEMENTS AND AWARDS:1961: Started as the Excavator Division of Tata Motors at Jamshedpur1976: Marketing of these equipments was taken over from M/s Voltas.1984: Collaboration agreement with Hitachi Construction Machinery Co. Ltd.1990: Tata-Hitachi EX series of excavators was launched.1991: The excavator division came to be known as the Construction Equipment Division (CED). The sale of excavators crossed 3000 units in the same year.1994: Creation of Construction Equipment Business Unit.1996: Indias first mini excavator the Tata-Hitachi EX60 was launched, which led to great success and reached record-breaking sales of more than 500 units.1997: Telcon CEBU signed a technical collaboration with John Deere Industrial Equipment Company, USA for the manufacture of Backhoe loaders.1998: State-of-the art manufacturing facility at Dharwad.1999: Construction Equipment Business Unit becomes a separate company-telcon.2000: Tata Motors (then Tata Engineering) and Hitachi sign Joint Venture for 80:20 stakes respectively.2003: Recently Telcon launched Indias largest excavator the Tata Hitachi EX-1200 was launched2004: Roll out of 10,000th EX series excavator2006: 10T Wheel Leader- First Assembled and Inaugurated New Central Warehouse Inaugurated at Nagpur Telcon won the Best Innovation Award for the Innovation Day organized by TBEM Eastern Region (For 10T Wheel Loader) 10000th Machine Rolled Out from Dharwad Plant in August Became a Zero Debt Company in December2006: ISO 9001 Certification2007: ISO 14001 Certification2008: JRDQV Award2009: Kharagpur plant under construction

Mini excavator Mid excavator Large excavator

Large dump truckerLarge excavator loaderLarge TG

Large transit mixer Large VM Large wheel loader Sub large cranesSub large Tata Hitachi

DEPARTMENTAL STUDY

DEPARTMENTAL STUDY: 1. Planning Department 2. Design Department 3. Supply Chain Department 4. Assembling Department 5. Quality Assurance Department 6. Maintenance Department 7. Finance Department 8. Human Resource Department

1. PLANNING DEPARTMENT

Planning Department in every organization is an important department so at Tata Hitachi Construction Machinery Co. Ltd also it is an important department, which plans each activity of the organization. This department also decides on goals and objectives, formulates policies to achieve these goals and policies. It also involves forecasting and research. Tata Hitachi Construction Machinery Co. Ltd believes Planning today avoids crisis of tomorrow. Planning is a very important concept to be considered before executing any action. Planning is the concept of executive managerial skill that embodies skill of anticipating, influencing and controlling the nature and direction of changes. Therefore, we can say that any organization needs planning to carry out its work and achieve its objective. It is an integral part of the management system. It involves selecting the best course of action. Need for planning: Planning minimizes risk and uncertainties. Leads to success. Focuses attention on the organizational goals. Helps manage by objectives. Facilitates control.

2. DESIGNING DEPARTMENTDesign is the base for any product. Designing is not one time job. It is a continuous process. As the needs and requirement change, the design must be changed too to satisfy the new needs of customers. In other words, it is like serving delicacy to the customers in terms of products. Therefore, design department is the brain of the organization that gives new ideas and innovations.Need for design and development department To face the tough effectively competition. To provide products to the customers. With the intension to the improvement and upgrading of the existing range and customizing it to suit for the Indian environment. To cope up with the customer needs, as their wants are dynamical. To increase the quality and efficiency of the machines produced and have a intension to reduce the cost of production. To develop new models and proprietary items.

3. SUPPLY CHAIN MANAGEMENT DEPARTMENT Supply chain management department is an important department at Telcon. SCM is the new name for the material and purchase department. The main function of the SCM department is to procure materials for the production department. Utmost care is taken at Telcon to select the good quality material in order to procure standard and quality goods keeping the satisfaction level of the customer in view. The materials that are to be purchased are classified into two types-Direct material and indirect material. The direct materials are used in assembly the machines and indirect materials are the source or aid to build the machines for example- tools, hand gloves, helmets etc. Here the design department will design the product and prepare a bill of materials which is called as BOM. This BOM is further given to planning department where the necessary changes are made in the bill of materials and then it is sent to SCM department. The BOM is the list of all direct materials to be procured.

4. ASSEMBLING DEPARTMENT

This department is the backbone of the company. Only assembling of parts takes place in this department. There are three assembly lines for assembling different types of excavators. They are Mini assembly line Midi assembly line Wheel shop All the 3 shops are divided into three parts: Sub assembly area(Left) Main line(Middle) Sub assembly area(Right) The contract workers maintain the stores department and bin cards are used for the stores in all the shops. Tata Hitachi Construction Machinery Co. Ltd also has a Paint shop, which is the best in Asia in its modernization and automation. The components are painted before issuing for production. There is also a small paint shop, gear shop and dispatch area. The machines are given final mal touch at small paint shop and in dispatch area loading and delivery takes place. Before dispatching, testing is done to locate defects if any, and to correct the same.SHOPS AND THEIR CAPACITATES MIDI SHOP Built up area -42000 Sq.mThe products assembled here are Excavators EX 110 Excavators EX 200The main engine used in EX 110 is Tata Engine. EX 200 is Cummins. Features: Chain Wheels Ex 110 capacity of 110 tones Ex 200 capacity of 200 tones 18 attachmentsApplication: Digging purpose Pipe lifting Stone breaking Mountain leveling

MINI SHOP Built up Area -3200 Sq.m It is the second shop where mini excavators are assembled. Products Excavators EX 70 Excavators EX 40 Excavators EX 20 Application Digging purpose Pipe lifting Stone breaking Mountain Leveling

WHEEL SHOP Built up Area-4000Sq.mts Third shop is named as wheel shop because wheels are used in the products instead of chains. Product Backhoe-TATA JD-315Features Rubber wheels Backhoe attachment at the back Loader attachment in the frontApplication Digging Loading

PAINT SHOP Built up area-7600Sq.m Goliath Cranes and under slung cranes are used for loading and unloading.Process: First base coat is applied to the component. Next Epoxy coat is applied to the component. This epoxy coat is usually in Grey color. Next P.U.coat is applied to the component. This is usually in orange color. Lastly, component subjected to heat treatment and next it is carried to the assembly unit.

5. QUALITY ASSURANCE DEPARTMENT:Tata Hitachi Construction Machinery Co. Ltd is committed maximizing customers satisfaction and delight. It will strive to achieve this goal by continues improvement of its design and development; manufacture; sales and services of its products. It will also ensure that its product is reliable, safe, environment friendly and cost effective and its services are of the highest order. Tata Hitachi Construction Machinery Co. Ltd also has a commitment to words improving the quality life of its employees, both within and outside its plants and offices, it will strive to achieve this through the continues improvement of its work practices and community initiative.

6. MAINTENANCE DEPARTMENT The main objective of this department is to reduce breakdown hours / time and also provide all resources for maintaining machines.Functions This department attend breakdown of machines and equipment in less time. This department maintains critical parts so that the breakdowns can be reduced. These departments carry out preventive maintenance of machine and equipments as per the preventive schedule plan. This can be done weekly, monthly and quarterly also. In order to avoid any mishaps and accidents safety equipments are to be maintainedProducts Spare parts like --bearings, valves, gears, electrical items, springs etc.

7. FINANCE DEPARTMENT Tata Hitachi Construction Machinery Co. Ltd also has a separate finance department that controls the financial sources of the company. Tata Hitachi Construction Machinery Co. Ltd has made a very huge investment to build the product. Finance department plays a very significant role in any organization. Tata Hitachi Construction Machinery Co. Ltd has made a very huge investment to build the business in the global market and to sustain any competition by introducing a variety of features in the product. Tata Hitachi Construction Machinery Co. Ltd believes that if one tries to eliminate the financial functions, he may have to put an end to the business activities. The financial department is to attain the desired goals in the stipulated time. Finance department encourages the effective use of the funds so as to improve the productivity in the business operation. The main objective of this is to maximize the value of the firm. Finance function is not merely procurement of funds but something more than that. Tata Hitachi Construction Machinery Co. Ltd maintains a clear and perfect accounting system. Finance department records the total activities of the company in financial terms. The activities of the accounts and finance department can be segregated below. Functions Every day transactions are recorded. Planning and controlling expenses and funds for production. The respective parties and vendors are paid accordingly Keeping a record of the payments received Preparation of P&L account on monthly basis and balance sheet on yearly basis. Preparation of fund flow and cash flow statements for every month. Preparing the new cost reduction and cost control methods and implementing them Planning and sketching the profitThe Accounting is done on TALLY System. The activities of the Department are classified as:1. Books of Accounts.2. Bills Payable.3. Commercial.4. Costing and Budgeting.Books of Accounts: This group looks the fund monitoring; trial balance preparation, bank reconciliation statement, cash management, books of accounts and also reporting to head office.Bills Payable: This group takes care of supplier payment, which includes the activities like bills checking, bills passing, etc. After comparing the Goods Inward Notes (GIN) and the suppliers invoice and comparing it with the purchase order the bill is passed. The data is fed to the computer and continuous updating is made in the system. There are two sub groups of the bills group viz. Revenue Bills and Capital, to take care of the respective activities.Commercial: This group is divided into following functional activities, which are Excise, Sales Tax, Sales accounting etc. Salary Section, which looks after the salaries of the employees, is also a part of this.Costing and Budgeting: This group concerned with activities like capital assets costing, fixed assets accounting, material accounting, budgeting and MIS, Auto and Non-auto costing.

Accounts Maintained Are Bank Account Profit and Loss Account Debtor Account Trial Balance Creditor Account Fixed Assets Cash AccountTally Software is used and the accounts are maintained through SAI system. The company deals with the State Bank Of India, HDFC Bank Ltd, Corporation Bank. The company prepares the annual report. The auditors concerned with the company are S.B. Billimoria and Co. for determining the financial results, net sales and other income, profit before tax, profit after tax and profit for appropriation. The company for reviewing financial performance and comparison uses current asset ratio, Inventory turnover ratio, Net profit ratio, Fixed Asset ratio etc.

8. HUMAN RESOURCE DEPARTMENT Human resource management is the field of management, which has to do with human relation its maintenance and its related issues, in order to attain the individual goals as well as company goals. Recruitment: In Tata Hitachi Construction Machinery Co. Ltd recruitment is called as hire to retire. Tata Hitachi Construction Machinery Co. Ltd is hiring its employees believing that they will serve the company until their retirement age. Tata Hitachi Construction Machinery Co. Ltd is recruiting its work force by the source of: Campus Selection: Selecting from different Engineering Colleges and IT institutes as its technical personnel. Private Employment Agencies: NTTF is serving as such agency by charging fees. Other than these, it is also recruiting by ways of internal recruitment, transfers, making use of data banks etc. Selection: In Tata Hitachi Construction Machinery Co. Ltd selection of managerial personnel is made on managerial selection scheme i.e. supervisors are promoted to managers grade as in Tata where in Tata employees are promoted.

OBJECTIVESPRIMARY OBJECTIVE:To analysis of the Cost Volume Profit and its impacts at TELCON LTD.SECONDARY OBJECTIVE: To identify the effect of breakeven point for multiple products and ascertain which product is as advantages. To study the level of sales need to achieve a desired target profit and identify Margin of safety and its significance. To measure the degree of leverages. To analyze the trend with regards to income, expenditure and profits.

SCOPE OF THE STUDYThis study is performed by using the cost sheet and balance sheet of TELCON LTD. The analysis done in the cost sheet are Breakeven analysis, profit volume, etc., these calculation cover the major areas like contribution margin, profit. This would be useful for company to make new strategy to compete in the market by adopting various controlling techniques in the process of manufacturing.

This study was conducted only on overall cost volume profit analysis and not on each variables. This study to help to forecast profit fairly and accurately as it is essential to know the relationship between profits and costs.

This study assists in evaluation of performance for the purpose of control and also assists in formulating policies by showing the effect of different price structure on costs and profits. This study predetermined overheads rates are related to a selected volume of production.

REVIEW OF LITERATURECost volume profit analysis is one of the most hallowed, and yet one of the simplest, analytical tool in management accounting. In a general sense, it provides a sweeping financial overview of the planning process (Horngren et. Al., 1994). That overview allows managers to examine the possible impacts of a wide range of strategic decisions. These decisions can include such crucial areas as pricing policies, product mixes, market expansion or contractions, outsourcing contracts, idle plant usage, discretionary expenses planning and a variety of other important considerations in the planning process. Given the board range of context in which cost volume profit can be used. The basic simplicity of cost volume profit is quite remarkable. Armed with just three inputs of data Sales price, variable cost per unit, and fixed cost a managerial analyst can evaluate the effect of decision that potentially alter the basic nature of a firm.

RESEARCH METHODOLOGYResearch Methodology is a way to systematically analysis the research subject and it may be understood as a science of study how research at done scientifically. Research is common parlance refer to a research for knowledge. According to Redman and Mary, research is defined as a systematized effort to gain new knowledge. Research Methodology is a way to systematically solve the problem. It may be understood as a science of studying how research is done scientifically. The advanced learners dictionary lay down the meaning of research as a careful investigation or inquiry especially through search for new facts in any branch of knowledge.The secondary data is collected from the annual report of TELCON LTD and the various records maintained in the Finance Department.In addition, the data collected by interviewing the Finance Department employees is used in this study to understand the thing clearly. It is necessary for the research method, techniques but also the methodology.

RESEARCH DESIGN:Research Design is the conceptual structure within which the research is conducted. A research is the arrangement of conditions for the collection and analysis of data in a manner that aims to combine the relevance to the research purpose with economy in procedures. Research constitutes the blue print for the collection.

CONCEPTUAL FRAMEWORKMEANING OF FINANCE In the modern money using economy, finance is considered to be the life blood of business. It is the foundation of every economic activity and is the pivot around which every business activity rotates. Money or finance has acquired so much of important that the modern economy is described as money economy. At present, we cannot think of an economy without money because an economy without money cannot function as effectively, efficiently and smoothly as a money economy. It has made possible tremendous saving of time and trouble in the marshalling of try of to final consumer it has brought about rapid economic progress by facilitating specialization and division of labor, technological progress large-scale production and expansion of various forms of business and financial organizations.

DEFINITION OF FINANCE In business, finance is defined as provision of money at the time when it is wanted. Finance is the art of rising and spending of money. Every business concern requires money or finance to commerce its operations and to continue its operations and for expansion or growth. There must be continuous flow of finance in or out of the organization.

COST-BENEFIT ANALYSIS: Costbenefit analysis (CBA), sometimes-called benefitcost analysis (BCA), is a systematic process for calculating and comparing benefits and costs of a project.CBA has two purposes: 1. To determine if it is a sound investment/decision (justification/feasibility).2. To provide a basis for comparing projects. It involves comparing the total expected cost of each option against the total expected benefits, to see whether the benefits outweigh the costs, and by how much.

THEORY: Governments and others, e.g. businesses, to evaluate the desirability of a given policy, often use costbenefit analysis. It is an analysis of the expected balance of benefits and costs, including an account of foregone alternatives and the status quo, helping predict whether the benefits of a policy outweigh its costs, and by how much (i.e. one can rank alternate policies in terms of the ratio of costs and benefit). Altering the status quo by choosing the lowest cost-benefit ratio can improve Pareto efficiency, [citation needed] in which no alternative policy can improve one group's situation without damaging another. Generally, accurate cost-benefit analysis identifies choices that increase welfare from a utilitarian perspective. Otherwise, cost-benefit analysis offers no guarantees of increased economic efficiency or increases of social welfare; generally, positive microeconomic theory is moot when it comes to evaluating the impact on social welfare of a policy.

Benefits of cost benefit analysis:It is one of the tools of analyzing and interpreting financial statements. It helps in understanding the financial health and trends of the firm. The following are different benefits.1. Benefit to management:The management use cost benefit analysis in formulating policies, making decision, evaluating performance, knowing the trend of business, planning and forecasting.

2. Benefit to share holders:Cost benefit analysis helps investor to select best company for making investment. The existing shareholders will be able to understand the performance of their company and about future prospects.

3. Benefit to creditors: Creditors and suppliers of goods on credit basis are interested in company, who has solvency and good liquidity position. 4. Benefit to employees: Employees are interested in the performance of the company as their benefits are related with profit earned by the company.

Disadvantages of Cost-Benefit analysis: 1. Historical values are considered in working out the calculations. However, the effects of changes in price level of various items are ignored and that extent comparison and evaluation of proposal becomes unrealistic. 2. Usefulness of the ratios depends upon the ability and intention of the person who handle them. 3. If there is a window dressing of financial statements ratios derived from them will not serve the purpose.

COST ANALYSIS: The accumulation, examination, and manipulation of cost data for comparisons and projections is called as cost analysis. In cost analysis I am taking 8 important costs to analyze that will give us the clear picture of the cost analysis in the company we are comparing these costs with respect to the net sales of the company so that we can get the ratio or the percentage of these costs to net sales of the company. The most important of them are:1. Factory expenses2. Administration expenses3. Operating expenses4. Direct expenses5. Indirect expenses6. Operating ratio7. Financial expenses8. Debt Equity proportionNow we will analyze each item with respect to sales so that we can get a clear picture of cost analysis of the company.

THEOROTICAL BACKGROUND