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Square Textiles LimitedSquare Textiles Limited

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Industrial StudyTour Report

onSquare Textile & Fabrics

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Prepared ForMr. Ruhul AminAssociate ProfessorSchool of Business StudiesSoutheast University

Submission DateDecember 25, 2013

Prepared ByName Roll No

Khandaker Zobaer Ahmed 2010010000002 Adiba Arshi 2010010000003 Shariar

Table of Contents

Title Page No.

Square Group of Industries 06Organizational Chart 08

Square Textiles Ltd. 11Introduction 12Unit Profile 13

Conclusion 14

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Acknowledgement   

This report is the result of many people’s contributions and help. At this moment we want to thank those people who extended their help providing suggestions and advices. Special thanks go to our honourable Course Instructor Ruhul Amin Sir Who helped us giving tips, suggestions and valuable advices regarding the report; he is also credited for her excellent teaching in this course. We also want to make thanks to those writers whose books helped us to make this valuable report. And also thanks Square Textile ltd. to provide important information.

Our friends who are in the following helped us a lot.

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Executive Summary

Square Textile Ltd. started its operation in 1997. It was enlisted in Dhaka Stock Exchange & Chittagong Stock Exchange in 2002. The business lines of Square Textile Ltd. are manufacturing and marketing of yarn. Its factory is located in Gazipur , Dhaka.

The manufactures 100% Cotton Ring Span Yarn or Hosiery, 100% Cotton OE Rotor for Hosiery and Knit Fabrics for 100% export oriented readymade Garments Industry.

The strategic Goals and Objectives of the Company are to strive hard to optimize profit though conduction and transparent business operations and to create more competitive in the internal and external market.

In home, customer of Square Textile Limited is export oriented readymade Garments Industry. The Company also exports its products to the market of Europe & USA.

The export sells increased by 19% in 2003 over the previous year.Competition level is increasing both in local and abroad market. Competition will be stiffer after 2005 when multifiber agreement will be phaced out. Among the other foreign competitors Srilanka, China Pakistan and India are prominent. 

Square is one of the biggest employees in Bangladesh. It has a personnel and administrative department. The total numbers of employees are 1223. For the employees there is systematic in house training in home and abroad.

The managing director, the CEO is the head of the executive management team. Below in there are directors, executive directors and general manager. Under the direct super vision of the general manager a number of departments are controlled.

The Company is going through continuous growth in production. The total production increased year on year basis at the rates of 0.43% and 1.467% during 2002 and 2003 respectively. The Company’s operations are out on an aggregate basis and are managed as a single opportunity segment. The Company uses Computer Aided Design (CAD), Computer Aides Spreading (CAS) and Computer Aided Manufacturing (CAM) in its plant to increase the overall efficiency and productivity.

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Square Group of Industries

Introduction

Square Group is one of the most renowned pharmaceutical company in Bangladesh. This group inaugurated their journey through Square firm in 1958. This is the first medicine exporting firm in the country. It’s contributing to the national economy by exporting medicine from 1987 to till now.

Square group is no longer confined to medicine production. They have diversified their activities. In 1988 they established Square Toiletries. In 1997 they established Square Textiles. In 2000 Square spinning started exporting by satisfying the local market. In 2001 Square group lunched many other firms: Knit Fabrics, Square Fashions Limited, Square Informatics, Square Consumer Product and Square Hospital. Now their total asset is about $200 million. And, yearly investment is about $300 million.

The companies of Square Group of Industries are:

Square Pharmaceuticals Ltd.

Square Textiles Ltd.

Square Spinnings Ltd.

Square Toiletries Ltd.

Square Consumer Products Ltd.

Square Informatix Ltd.

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Square Health Products Ltd.

Square Agro Ltd.

Sheltech

Pioneer Insurance Company Ltd.

Mutual Trust Bank Ltd.

National Housing Finance And Investment Ltd.

Mediacom Ltd.

Aegis Services Ltd.

Maasranga Productions

These all following companies owner is Square Group of Industries. So, it’s too much tough to visit all companies within a day. So, we just visit their only textiles & fabrics company. In our report, we only present the details of these companies detail & their production possibility. And also know about how they help our country to improve our economic growth rate.

Organizational Chart

As we know that Organizational chart is the framework of an organization. It helps to

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accomplish the goals effectively and efficiently. It represents the organizational skills and also uniqueness in the business world. Square Group also follows a realistic organizational chart. The chart is given in below:

Organizational Chart

Managing director

General Manager

Manager (Export) Manager (Purchase) Manager (Production)

Plant Manager

Supervisor

Operator

Junior Operator

Assistant Operator

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Square Textiles Ltd.

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COMPANY OVERVIEW

ABOUT COMPANY:

Square Textiles Ltd. started its journey by establishing the first unit in 1997. One year later the second unit was established. Square Textile is a subsidiary company of Square Group .The Company was incorporated as a public limited company in the year of 1994. The operation was started in 1997.It was enlisted in Dhaka Stock Exchange & Chittagong Stock Exchange in 2002. Within a very short time of span the company achieved some significance success. Square Textile receives Oeko-Tex standard 100 and ISO-9002 certificates in the year 2000. Authorized capital of the company is tk. 1000 million. It’s paid- up capital is tk. 251.90 million. 1,223 employees are working in this organization. The business lines of Square Textiles Limited are manufacturing and marketing of yarn. The factory is located in Saradaganj, Kashimpur, Gazipur, Bangladesh. Its office is located at Uttara in Dhaka

MISSION STATEMENT:

The mission statement of Square Textiles Limited is “Our mission is realization of vision through maximum production of goods and services strictly on ethical and moral standards at minimum costs to the society ensuring optimum benefits to the shareholders and other stakeholders.” This mission is envisioned by the concept of business which ensures well being of the investors, stakeholders, employees and members of the society which will create new wealth in the form of goods and services.

KEY PRODUCT / SERVICES:

As stated earlier the business line of the company is manufacturing and marketing of yarn. It manufactures:

• 100% Cotton Ring Span Yarn For Hosiery• 100% Cotton OE Rotor Yarn for Hosiery• Knit Fabrics for 100% export oriented readymade Garments Industry.

It also performs the following services:-

• Dying & Post Mercerization.• Fabric Dying

 The final output is marketwise by Square Fashion Ltd.In Square Textile Limited two types of products are produced in two different units. These are as follows:

Unit 1: Combed and Carded Yarn from a count range of Ne.10 to Ne.80.

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Unit 2: Combed Ring Yarn from a count range of Ne.20 to Ne.40. In Square Spinning Ltd. 100% Cotton Carded and Combed Yarn in the count range of Ne.16 to Ne.30 are produces. Finally in Square Fashion’s Ltd. Readymade Knit Apparels like T-shirts, Polo shirts, Tank tops, Pajamas, Sport wear, Under garments, Men’s & Ladies fashion wear , Kids wear etc

STRATEGIC GOALS & OBJECTIVES:   

The company sets the following objectives for it to achieve:

• To strive hard to optimize profit through conduction of transparent business operations within the legal and social framework with malice to none and justice for all• To create more jobs with minimum investments• To be competitive in the internal as well as external markets• To maximize export earning with minimum imported in-puts• To reduce the income gap between top and bottom categories of employees.

Thus the company focuses to pole-star its mission that fulfill the objective with emphasis on the quality of the product , process and services blended with good – governance that help build the image of the most enable corporate – citizenship at home and abroad . The company wants to produce such society friendly goods and services that go to satisfy the wants of all the relevant party without disturbing or damaging the socio- economic and ecological, balance of the mother earth and the process of human civilization leading to peaceful co-existence of all the leaving beings. The company always strives for top quality products at the least cost reaching the lowest rungs of the economic class of people in the country. The company values its obligation to the greater society as well as it strives to protect the interests of it’s shareholders and to ensure highest return and growth of their assets.

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Square Textiles Limited - Marketing Overview

MARKETING OVERVIEW

POTENTIAL CUSTOMER: The target market for products produced in Square Textiles Ltd. and Square Spinning Ltd. is Export Oriented Readymade Garments Industry. Readymade Garments exporter that is Knit Fabrics, Sweater and Denim manufacturer. In Bangladesh Beximco Kitting, Grameen Knitwear, Shasha Denim, Knit Concern etc are the customers. Target market for products produced in Square Fashion Ltd. is Europe and U.S.A. Square Textiles does not direct sales in overseas market but sometimes India, Pakistan & other countries take their yarn.

SIZE & GROWTH OF MARKET:

The Company’s marketing operations continued its emphasis on export sales over the years as depicted below:

Year - 2006 Year - 2005 Year - 2004

(a) Quality sold (Kg)

Local sales 99,800(0.7%)

527,903(3.7%)

539,417(3.9%)

Export Sales 14,554,342(99.3%)

13,817,314(96.3%)

13,129,599(96.1%)

Total Sales 14,654,142(100%)

14,345,217(100%)

13,669,016(100%)

(b) Sales Revenue ( Taka )

Local Sales 9,455,588(0.4%)

32,576,936(1.8%)

46,956,494(2.3%)

Export Sales 2,093,214,675(99.6%)

1,756,441,450(98.2%)

2,029,968,545(97.7%)

Total Sales 2,102,670,263(100%)

1,789,018,386(100%)

2,076,925,039(100%)

The above figures show that the export sales increased by 19% in 2006over the previous year with greater exposure to international market scenario and risk.

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. Financial Statements & Performance Data

Square Textiles Ltd.2009 2008 2007 2006 2005 2004

Current Assets 3,224,729,710 3,437,049,714 1,909,672,000 1,417,780,000 1,391,410,000 1,357,092,000Current Liabilities 2,388,878,289 2,843,250,860 1,382,789,000 1,269,821,000 989,212,000 1,187,839,000Inventory 942,568,134 1,267,785,890 577,163,363 487,871,798 487,753,824 405,449,809COGS 3,348,870,289 2,589,019,736 1,958,696,404 2,041,065,393 1,847,818,461 2,083,702,523Accounts Receivable 1,683,329,048 1,689,670,282 819,360,445 821,199,524 756,736,173 834,989,837

Sales 3,882,244,010 3,052,235,640 2,541,543,000 2,620,966,000 2,390,979,000 2,459,201,000Fixed Assets 2,283,552,606 2,370,847,250 1,573,559,000 1,702,906,000 1,193,767,000 1,180,203,000Total Assets 5,508,282,316 5,807,896,964 3,483,231,000 3,120,686,000 2,585,177,000 2,537,295,000Total Debt 2,388,878,289 2,843,250,860 1,382,789,000 1,269,821,000 989,212,000 1,187,839,000EBIT 433,507,033 387,282,778 517,149,366 481,315,121 465,778,608 300,290,342Interest Expenses 121,730,159 109,701,045 106,026,180 77,350,086 67,966,406 70,530,935Net Income 260,634,002 236,529,908 352,447,136 348,833,453 255,494,330 198,689,678Common Equity 3,119,404,027 2,964,646,104 2,020,482,000 1,770,905,000 1,513,511,000 1,349,457,000Market Price 111.54 117.3 127.4 75.6 81.7 138.3EPS 3.69 4.71 8.94 8.85 6.48 5.04Book Value 44.19 50.04 51.23 51.65 49.66 48.7No. of shares 70,584,053 58,820,044 39,433,370 34,289,887 30,479,900 27,709,000Dividend payout 218,810,564 223,516,167 177,450,165 154,304,492 129,539,575 110,836,000Dividend per share 3.10 3.80 4.50 4.50 4.25 4.00

FINDINGS AND RECOMMEDATIONS

Findings: Textile industry is a comparatively new in our country. The size of the industry is still growing. Square Textiles Limited is one of the first movers in this sector. Starting only in 1997 ,

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it has managed to be grown up as one of the country’s leading Textile Company . Its increase turnover has been significantly increasing, since 1997-2007. It is providing employment to a large number of skilled and unskilled people all over the country. The Company contributed an amount of taka 37.892 million to the national exchequer in different forms like Cooperate Income Tax, Advance Income Tax, Ecise, Vat, Import Duties, Taxes, Government Taxes , Stamp Duties, License Fees etc. The Company contributed substantially to the Foreign Exchange Reserve of the country through its export marketing operation. In 2007its net export earning was taka 1021.368 million.

Recommendations:  From the analysis with the organization structure we have seen that its span of super vision is too large. A number of departments report directly to the general manager. If the number were less the efficiency and productivity of the organization might be increased.

Quality control department should remain prompt always. So that it can maintain a certain level of standard as per the market demand to capture the foreign market share it should strive more.

CONCLUSION

The flourishment of any industry requires combined efforts and co-operation from several parties . Social , political and macro economic environment play pivotal role in this regard . Though Square Textile is a newly Ventured Company in the respective sector, its growth and expansion is praiseworthy. Its contributing the country and serving the nation in different ways. If it can up hold its much toward advancement, it will be able to set a role model in our country.

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