HIMSON ENGINEERING PVT.LTD.

HIMSON ENGINEERING PVT.LTD.

CHAPTER-1

INTRODUCTION

1.1 Overview of the company:

Himson Engineering Pvt.Ltd.is the flagship company of the Himson Bhogibhai Group. It is one of the largest manufacturer of textile machinery in India with the experience of more than 3 decades.The engineering activities of the group are carried out under the direct control of Head-Quarters located at Ashwanikumar Road premises at Surat, India.Initially, in the year 1978, HIMSON tied up with Earnest Scragg Sons Ltd., UK to manufacture Draw-Texturising Machines in India. Since then, the strategy has been to acquire the best available technology from the reputed and innovative internationally leading companies and upgrade the same with help of the experts around the world in conjuction with our in-house development experts and considerably long machine-building experience. This strategy has worked very well and eventually, made the company successful in its field in India & Abroad.Today, the company enjoys significant market share of Synthetic Yarn Processing Machinery in India. (Supplied more than 3000 Draw-Texturising machines) the fast growth has been sustained on continuous upgradation & design and manufacturing facilities by installing most modern CNC machining centers, fabrication units and metal finishing shop in-house together with the latest Design and Development Center equipped with modern CAD/CAM facilities and latest state-of-the art designing softwares to achieve highest accuracy and maintaining stringent quality standards, benchmarked against the best in the world. Himson Engineering Pvt Ltd is accredited with ISO 9001:2000 Certification. Today, HIMSON enjoys high reputation for in-house research and technology developments and an efficient and reliable After-Sales-Services.In year 1998, HIMSON entered into a technical collaboration with M/s. Teijin Seiki Textile Machinery Co. Ltd., Japan to manufacture High Speed Draw-Texturising Machines with Energy Conserving Short Heaters and Auto Doffing.Himson Engineering enjoys a very respectful image as supplier of world class textile machines and is the leader in almost all the products that it manufactures. Many of the products are exported to developed as well as developing countries. The manufacturing facilities are now also offered to the Indian & International industries, to fully exploit the capacities which has been generates over the years.In the year 2008, Himson Engineering Pvt Ltd also received a prestigious order from Alok Industries Ltd, one of the leading textile unit in India for supply of Auto Doffing Draw Texturising Machine. Himson Engineering Pvt Ltd has executed this prestigious order for supply of Himson TMT Draw Texturising Machine Model ATH 12 F/V each with 288 spindles in joint corporation with world re-known TMT Japan (TMT Machinery , Inc Japan)This is the 1st time in India Auto Doffing Machines are manufactured and installed also, this the 1st time in world to supply this machine with 288 spindles

Address :Hiralal Cly., A K Road

Level of Office :Head Office

Website :www.himson.com

Industry :Garment , Textile, Engineering, Capital Goods , Machines

Sub Industry :Textile Machines, Machineries , Instruments

City :Surat

State :Gujarat

Pin :395008

Company Type :Industry Best

Total Turnover :100-250 Crs

No. of Employees :501-1000

Sector :Private Sector

Business Type :Exporter / Manufacturer

Year Established1970

No. Of Employees50

Export TurnoverRs 20 Crores

Annual Turnover20

BankersBANK OF BARODA

Products Manufacturing and ExportingYarn processing machinery from draw texturising machines to draw twisting machines, air texturising machines, two for one twisters for filament yarn, ...

List of Board of DirectorsDirectors1. Shri Surajram H. Bachkaniwala2. Shri Shantilal H. Bachkaniwala3. Shri Bhogilal H. Bachkaniwala4. Shri Pannalal H. Bachkaniwala5. Shri Rajanikant S. Bachkaniwala6. Shri Dinesh S. Bachkaniwala

BankersBank of Baroda Parsi Sheri,Surat.

Auditors M/s. Natvarlal Vepari & Co. Chartered Accountants.

Company SecretaryMr. Pankaj Savalia.

Registered OfficeHiralal Colony,Ashwanikumar Road, Surat- 395008.

Works

1. Hiralal Colony, A.K. Road, Surat.2. Borsara Machines, Village Kim3. G.I.D.C. Pandesara, Surat.4. G.I.D.C. Ankleshwar5. Somnath Industrial Estate, Daman6. Borsara Machine, Village Amil, Silvassa7. Indo-Nippon Filaments, Karanj, Ta. Mandavi.8. Silvassa Machines, Silvassa.9. Ambica Textile Engineers, Pandesara.10. Palod Machines, Palod.

CHAPTER-2

MARKETING

& SALESDEPARTMENT

2.1 Basic understanding of marketing and sales :a. Meaning of marketing and sales:

Market:-The common usage of market means a place where goods are bought or sold. In its strict meaning market need not necessarily mean a place of exchange.

Marketing: -

Marketing is concerned with selling but now a days the concept has enlarged its meaning. We know that a product is provided with the aim of sale. The aim producer totally depends on marketing. Without marketing no unit can run. It covers marketing research, new product development and so many other important functions.

Marketing is the process of discovering and translating consumer needs and wants into product and service specifications, creating demand for these products and services and then in turn expanding this demand.

But, here in Himson Engineering Pvt.Ltd. There is no more need of the marketing in selling activity of the products because this company has no more competitors who can reduce the market demand of this companys product.So here customers come to this company and asks for its products

b. Differentiate between marketing & sales:

MarketingSelling

1.marketing is a total system of business activities.1.selling means exchange of goods or services against payment of price.

2.marketing is a broadliy defined concept.2.selling is a narrowly defined concept.

3.starting point of marketing is the target market.3.starting point is factory.

4.focus on customers needs satisfaction.4.focus is on product.

c. Detailed structure of marketing department.

2.2 Marketing Environment.

a. concept of target & target customers: All the people, companies, organizations have directly and indirectly concern with textile industries.

b. Macro environment: Following environments are affected to HIMSON PVT.LTD

Legal environment: Legal environment consist of factors related to planning,promotion & regulation of economic activities.It also affects the activities of an organization.It consists of the following factors:

1. the constitutional framework.its directive principles fundamental rights & powers of the center & states.

2. Industrial policy regarding investment & financing of industries.

3. policies relating to price controls.

4. Imports & exports policies.

5. Policy related consumer protection.

6. regulation of foreign exchange.

Technological environment:Today we live in a fast changing technological environment.It has profound influence over business activities & its capabitility to compet others,it consists of the following factors:1. Sorces of the technology such as R & D department of the company itself.

2. technological environment,phase of development,chances in technology rate of chnges & R & D activities.

3. Impact of technology on human beings,environmental efferts of technology & man machine system.

4. communication & infrastructure related technology useful in management.

Economical environment: Economical environment comprises of factors of production & distribution of weaith in the nation.generally it is made up of the following factors:

1. Phas of economic development during specific period of time.

2. economic ideology adopted by the nation such as capitalism,socialism or mixed economy.

3. economic planning,budget etc.

4. Economic policies such as industrial policy,monetary policy,fiscal policy etc.

5. economic indicators like growth rate of GDP,rate of saving rate of capital formation,industrial production index,stock exchange index,balance of trade,balance of paymants,per capita income etc.

6. infrastruture facilities like roads railways,ports,banking & insurance service,supply of electricity,means of communication etc. Details of competitors :-Today, competition is not only rife but growing more intense every year. The markets have become so competitive, understanding customers are not longer enough. Companies must start paying keen attention to their competitors. Successful companies design and operate systems for gathering continuous intelligence about competitors.The major competitors of Himson Textile Engineering Industries Pvt Ltd. are as under 1. Barmay (Germany)2. Bata (Japan)3. Alidhra4. Musata The main objective of each company is to increase its market value.

2.3 consumer & industrial buying behaviour:

a. Meaning of consumer & indusrial buying behavior:

Meaning of consumer buying behavior:Consumer buying behavior may br as the acts of individuals in obtaining & using a product or services including the decision processes that precede & determine these acts.

Meaning of industrial buying behavior: Induustrial buying behavior is the bu=ying decision making process by which the formal organization identifies its needs for5 products, raw materials & services & identifies,evaluates & chooses among alternatives brands & suppliers with an objectives of sharpening its competitive edge.

b. Design process of both behavior:

Consumer buying behavior process

Step 1.Problem or need recognitionHow do you decide you want to buy a particular product or service? It could be that your textile machine stops working and you now have to look for a new one, So you have a problem or a new need. For high value items like a textile machines or spare parts or other low frequency purchased products this is the process we would take. However, for impulse low frequency purchases e.g. confectionery the process is different.

Step 2. Information searchSo we have a problem, our textile machine no longer works and we need to buy a new one. Whats the solution? Yes go out and purchase a new one, but which brand? Shall we buy the same brand as the one that blew up? Or stay clear of that? Consumer often go on some form of information search to help them through their purchase decision. Sources of information could be family, friends, neighbours who may have the product you have in mind, alternatively you may ask the sales people, or dealers, or read specialist magazines like What new textile machine ? to help with their purchase decision. You may even actually examine the product before you decide to purchase it.

Step 3. Evaluation of different purchase options.So what textile machine do we purchase? Shall it from different companies of textile industry Consumers allocate attribute factors to certain products, almost like a point scoring system which they work out in their mind over which brand to purchase. This means that consumers know what features from the rivals will benefit them and they attach different degrees of importance to each attribute. It could be that the a review the consumer reads on the particular product may have tipped the balance and that they will purchase that brand.Step 4. Purchase decision

Through the evaluation process discussed above consumers will reach their final purchase decision and they reach the final process of going through the purchase action e.g. The process of going to the shop to buy the product, which for some consumers can be as just as rewarding as actually purchasing the product. Purchase of the product can either be through the store, the web, or over the phone.Step 5.Post Purchase Behaviour

Ever have doubts about the product after you purchased it? This simply is post purchase behaviour and research shows that it is a common trait amongst purchasers of products. Manufacturers of products clearly want recent consumers to feel proud of their purchase, it is therefore just as important for manufacturers to advertise for the sake of their recent purchaser so consumers feel comfortable that they own a product from a strong and reputable organisation. This limits post purchase behaviour. i.e. You feel reassured that you own the latest advertised product.

Industrial buying behavior process:Step 1.Problem or need recognitionProblem or need is recognized by a result of internal and external stimuli.the internal stimuli followed by Aalidhra is as follows: Aalidhra decides to develop new product requiring new machines, equipments, and materials. Break down of a machines requiring replacement. Purchased materials are found unsatisfactory Aalidhra searches for new supplier.Step 2.General need descriptionOnce a need is identified the buyer determines the general characteristics of the needed items. Quality required is also specified. For the standard product in this there is not so much customer involvement.Step 3.Product specificationIn this stage Aalidhra prescribes the detailed specification of the items required. In the order to prescribe technical specifications of the item Aalidhra may assign a product value analsis engineering team to the project.Step 4.Search of suppliersAfter Precribing the specification the aalidhra tries to search out the suppliers or vendors. Main sources out the suppliers or vendors . main sources of the search of vendors are trade directories, internet, watching trade advertisement, visit to industrial exhibition phone to other companies for recommendations etc.Step 5.Inviting proposals from qualified suppliersAt this stage proposals in the form of sealed tenders are invited from the qualified suppliers or vendors.

Step 6. Selection of suppliersBefore selecting a suppliers the buying centre will specify the attributes of desired suppliers of desired suppliers like production capacity, quality control system, services after sale, relations with the union, price etc.Step 7.Determination of order size and placement of an orderAfter selection of suppliers order size is determination and order containing the quality specifaction the quality specifactions, price, quated by the suppliers and negociated by Aalidhra.Step 8.Performance review and feedbackThis stage is important for the suppliers because it is concerned with reviewing the performance of the suppliers.Generally the buying center review the performance of the suppliers and obtains feedback from all department using the suppliers products.

2.4 Product: a. Meaning of product:The product is the most tangible and important and single component of the marketing programme. Without a product, there is nothing to distribute, nothing to promote, nothing to price.

To the marketer products are building blocks of a marketing plan. Good products are key to market success. Product is the vehicle by which a company provides consumer satisfaction. It is the engine that pulls the rest of the marketing programme. Products fill in the needs of society. They represent a bundle of expectations to consumers and society.

A product is anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need.

c. Classification of products : -The products may be classified into the following categories:

Industrial Products: Industrial goods are those, which are used for further production of goods or services, and include capital goods, raw materials, component parts etc. These are used as input in producing other products.

Consumer Products: Consumer goods are meant for final consumption by consumers and not for sale. Himson Pvt. Ltd. is producing industrial goods, which indirectly affects the consumers.

Product Mix : Product mix is also called as product assortment which is the set of all product lines and items that a particular seller offers for sale to buyers.A companys product mix has certain width, length, depth and consistency. These concepts are illustrated for industrial products of Himson Pvt. Ltd.

WIDTH

Draw texturising machineTwo for oneKnitting machineRappier weaving machinePrecision cone winderWeaving machine

L E N G T H HDS-1500ATSDS-700CRHDS-EX2HDS-VX2HDS-TTHDS-CXDT-3000DT-90ENDT75RCAMBERRAPTECH-SPRINTRPV-JacquardPK-1200DobbyPKD-200

1. Width: The width of a product refers to how many different product lines the company carries. The above table shows a product width of 6 lines.2. Length: The length of the product refers to the total number of items in the mix. In the above table it is 15.

3. Depth: The depth of a product refers to how many variants are offered of each product in the line.

4. Consistency: The consistency of a product refers to how closely related the various product lines. All the machines are texturising machines in Himson Pvt. Ltd.

d. Product Life Cycle : -

As every being has life, a product has its life. Industrial goods may have a longer life than consumer goods. When a product idea is commercialized, the product enters in to the market & competes with the rivals, for making sales & earning profits. Products, like human being, have length of life. This has been described as life cycle in human beings & when applied to products which is called as PLC.

As we know that Himson Pvt. Ltd. produces industrial goods & these goods are used for producing consumer goods. Industrial goods are long term purchasing decision

e. Packing and Labeling: There are mainly two product which are been manufactured in Himson Engineering pvt. Ltd.And number of sub assembly for manufacturing the main product are also produced in the company .it means the company.It means the company contain in house production system.in the surat branch only the number of sub assembly are manufactured and transported by the trucks.There are probably 200 to 255 sub assemblies ,which plays an important role in production process of texturising machine are been produced and they export these sub assemblies to the kim plant and other customer according to their order.

Packaging:The packaging and labeling of the Himson Engineering Pvt.Ltd is very simple and easy .through it play an very important role for the transportation of the machine through road route. After making the product Himson group covers the entire product in plastic. Then after the product is been put in the wooden boxes. The wooden boxes are also been manufactured in the Himson engineering pvt .Ltd means company again contain in house production system.

The main objective of packaging the machines are as below:-1. It protects the product against the calamities. 2. The degree of damage is been reduced by such type of packaging.3. It helps to deliver the product safety to the destination.

Labeling:The labeling system is used to describe the details of the products which are been exported to the customers. In Himsion Engineering Pvt. Ltd. Labeling system is comprehensive. The main objective of labeling is there should be no mistake while exporting the machineries to the customers means some times to the wrong order is been transported to the customer. So labeling system reduces such type of mistakes.

In Himson Engineering Pvt. Ltd. Labeling can be done as below: Company name and address. Receivers name and address. Number of boxes. Brief details of products in those boxes. No.of items in each box. Length,weight and gross weight.

So, in this company, descriptive type of labeling is been used to define the packed parts.

f. Brand & Brand equity:

Brand:Brand means a name,a term,a sign,symbol or design or a combination of these intended to identify the goods or services of one seller and to differentiate them from those competitorsA brand is a sellers promise to deliver consistently a specific set of features,benefits and services to buyers. The best brand convey a warranty of quality. Importance of brand: 1. It is easy to identify the product. 2. The brand gives a separate identity to a product. 3. Brand can be a trand mark. 4. Brand gives legal protection. 5. The producers can be identified with the barnd name. 6. A brand can be a symbol of quality.

Brand equity: A set of assets and liabilities linked to a brand,its name and symbol that add to or subtract from the value provided by a product or services to a firm and or to that firms competitors 1. Brand loyalty of customers. 2. Brand name awareness. 3. Brands perceived quality. 4. Brand association in addition to quality perceived. 5. Other proprietary brand assets like patents,trademarks,channel relationships etc.

2.5 Pricing:-a. Meaning of price:Price may be defined as the exchange of the goods & services in terms of money. What you pay is the price for what you get.

There are mainly five customers in India of this company and the price for each product is generally 1.0 crore to 1.5 crore rs. This company also contains many customers in abroad countries like Japan, South Africa, Sri Lanka, U.K, Nepal, Germony etc.Usually this company sets the price of each product around 1.5 crore to 2.0 crores for the customers of foreign countries.And company set the price for each product around 1.0 crore to 1.5 crore.For the customers of India. Pricing decisions have strategic importance in any enterprise. Pricing governs the very feasibility of any marketing programme because it is the only element in a marketing mix accounting for demand & sales revenue.\

b. Pricing strategy:

Himson Pvt. Ltd. uses the following pricing strategies for their different product:

Penetration pricing: A low price is designed in the initial stage with a view to capture greater market share. When the large number of competitors are existing in the market at that time Himson uses this strategy for pricing.

Skimming pricing: This pricing strategy is characterized by high initial price of the product at the time of introduction of the product in the market. Manufacturers aim at the shortest period, where market conditions are also favorable. The price is brought down when competitors enter in to the market field.

Pricing decision:

1. No., Himson Pvt. Ltd. Draw Texturising M/C Model, HDS-CX2 Having 264 Spindles with inverters, Non-contact debtors, Intermediate Traverse, Microprocessor Based Temp. Control, 1-4-1 PU discs, HPS Cradles, Std. Box Creel and Battery-Back-up system W/O battery. Rs.__________The price quoted above is on ex-works Surat, Silvassa basis. Forwarding, insurance, freight, excise, sales tax, octroy and any other applicable taxes would be charged extra to customer account at the ruling rate of the time delivery of the machine.

The price is based on the current foreign exchange rate and custom duty at 25% on imported components. Any variation in the foreign exchange and custom duty at the time of clearance of imported components would be customers account. The price mentioned is also based on the prevailing Govt. Policy and regulation import controls and on foreign exchange rate and foreign exchange transaction. Hence any variation on the same at the time of supply of machine would be to your account. Packing: -@ 3% will be charged extra. Delivery: Within-two weeks after receipt of customers firms orders along with necessary non-refundable security deposit and clarification on all technical/commercial points. Payment: 20% non-refundable security deposit along with customer from order and remaining 80% against proforma invoice before delivery of the machine Erection & Commissioning: Not included in the above prices. Spare Parts: No spare parts are included in the above prices. Validity: The offer is valid for 60 days only from the quotation date.

This quotation is subject to our General Terms and Conditions of supply. The prices quoted and deliveries indicated are subject to Force-Majeure Conditions and final confirmation by them at the time of acceptance of customer firm order along with necessary advance payment. 2.6 Place:a. Meaning of Place:A channel of distribution means a system consisting of different marketing intermedieries through which products or services are distributed from the place of manufacturer to the utilities consumer.b. Functions of channel of distribution: 1.Collection of information. 2.Search of potential customers. 3.Stimulate demand through advertising. 4.harmonising supply with individual needs. 5.Collection and classification of products. 6.Transportation and storage. 7.Advice and guidance to the consumers. 8.Concession in payment. 9.Undertake business risk. 10.Transfer of ownership rights.

c. Channels of distribution: Channel of direct sale of goods:Zero level channel 1. Direct sale from the factory. 2. Direct sale through retail shops. 3. Sale through salesmen. 4. Sale through main order. 5. Sale by telephone. 6. Auction sale. Channels of indirect sale of goods:one or more level channelHere well discuss about direct sale from the factory: Direct from the factory: In certain cases manufacturer directly sells its product to the consumer from the factory or place of production. Hough the use of this channel is very limited,the manufactures of perishable products and food canning products often use this channel of direct sale from the factory. In certain cases cloth mills also open a small store in factory and sell cloth to the employees of the mill and also to the public. Generally small manufactures producing price product items use this channel. Advantage of live contact with the consumers,speedy delievery and avoidance of middlemens profit are the merits there are certain limitations channel.Himson pvt.ltd. company also uses this channel of distribution.

2.7 Promotion:a. Meaning of promotion:Promotion means a set of efforts made by the company for stimulating the demand for its product or products without making any alteration in product mix,price and channel of distribution.

b. Elements of promotion mix:Promotion mix means a set of tools like advertising,public relations and publicitu,sales promotion ,personal selling and direct marketing used by the marketer for the promoting sales by stimulating demand through persuasive communication.\ 1. Advertising. 2. Public relations. 3. Personal selling. 4. Sales promotion. 5. Direct marketing.Here well discuss about advertising and direct marketing:

Advertising:advertising can be defined as any paid form of presentation and promotion of ideas,goods and services by an identified sponsor

Characteristics of advertising: 1. Non personal form of communication. 2. Wide spread media. 3. Identity of the sponsor. 4. Payment of the price. Direct marketing:There are many forms of direct marketing but the main forms are direct mail,telemarketing,electronic marketing etc.they all use persuasive communication for stimulating demand. Characteristics of direct marketing:1. Communication message is non public.2. The message can be customized to appeal to the addressee person.3. The communication message can be prepared very quickly for delievery to a specific person. 4 . There is in teractive communication.

c. Communication process:

Step 1.Identify the target audience.Image is the set of beliefs, ideas, and impressions of the target audience about the company. its product and competitors. Peoples attitude and buying behaviour toward the product of the company are highly conditioned by the image the audience hold about the company and its product. Therefore, the first step of the communicator should be to measure the knowledge of the target audience about the product.In the HIMSON target customer are all the people related to the textile industriesStep 2.Determine the communication objectives.The objectives of communication should be to move the target audience step by step towards higher states of readiness to buy. It meanes there is a hierarchy or sequence of communication objectives leading the target audience from cognitive stage or awareness stage to effective and behavioural stage. This sequence is Learn Feel Do sequence.The main objective of the communication is to make inspire the target audience to buy the product of Himson for their textile production unit. Step 3.Design the message.After defining the desired response of the audience the communicator has to develop an effective message. according to AIDA model the message should gain attention, create interest, arouse desire and elicit action. The AIDA model suggests the desirable qualities of any communication message.Step 4. Select the communication channel.The communicator after designing and preparing the message should select efficient channel for that Aalidhra has select Direct marketing and advertising.

Step 5. establish the total promotion budget.Aalidhra established affordable method for the total promotion budget.

Step 6. Decide on the promotion mix.Promotion mix consist of advertising,public relations and publicity, sales promotion, personal selling and direct marketing.Factors affecting promotion mix to Aalidhra: Type of product market Push Vs pull strategy Buyer readiness stage Product life cycle Market rank of the company

Step 7. Measure the promotions results.Every efforts might have been made for developing effective communications. Marketing communication is a cistly affair.

Step 8. Manage and co-ordinate the intergrated marketing communication process.We know that marketing communication includes promotion mix. Though the things have changed many companies still rely on one or two communication tools to achieve their communication objectives.

2.8 Marketing control:

a. Meaning and importance of marketing control:

Meaning:Marketing is a process of measuring and evaluating the results of marketing strategies and plans and taking remedial actions to ensure that marketing objectives are achieved.

Importance of Marketing control: 1. Control on selling cost. 2. To balance the sales of different products. 3. To maintain regional balance of sales. 4. To control the selling activities of the salesmen. 5. Successful implementation of marketing plans.

CHAPTER-3

PRODUCTION

DEPARTMENT

IntroductionDefinition:Production is the process by which row material and other inputs are converted into finished goods or services so that the utility of inputs is enhance and the needs of customers are satisfied.Production management:Production management refers to the application of management principles to the production function or process in a factory or on organisation.

3.1 Type of plant layout used:In the Himson they do not use any particular one plant layout but they use combine plant layout of following two layout.1. Product layout2. Cellular manufacturing layout

3.2 Material handling equipments used:Himson uses trolly and goods lift to move raw material from one place to another palce.

3.3 Production planning:Production planning is based on the customers orders

DesigndevelopmentItem masterRout cardMain planningSales orderDesignMRP ProcessWork orderIndentPurchase orderinward

S.O.PlanningMRPIndentP.O.InwardInspectionW.O.StoreIVMDespatchA/c DepartmentBillingBOMRoutcardLabour Despatch

P-2

P-1

P-3 P-4

P-5

P-7

P-6

P-9P-8

Raw material Finish receipt

Against W.O. to store

P-10

P-11

P-14

P-15

P-12

P-16

P-13

3.4 Production scheduling:a. Scheduling strategies for production process: there are two types of scheduling: -Backward scheduling. -forward scheduling.AALIDHRA use forward scheduling.b. Priority control techniques used for scheduling jobs:There are about six to seven priority rules for priority control and they are as follow1. FCFS First come first serve2. SPT Shortest processing time3. LPT longer processing time4. LS - Least slack5. CR Critical ratio6. EDD Earliest due date7. PCO Preferred customer orderAbove seven are the different priority control rules which are use for sequencing scheduling the workIn the Himson Company they use the all of the first rule and that is First Come First Serve. They give the first priority to those customers who come first.

3.5 Inventory control:Objectives of carrying inventory To keep the production process continuously moving, if there is enough stock of row materials so that the time taken for last moment purchases is avoided Some products may require assembling of various spare parts. The production time for each spare part might be different. semi-finished goods inventory is maintained to store spare parts taking less production time till the spare parts with high production time are produce To be helpful in efficient purchasing, maintenance of optimum stock is closely connected with a system of inventory control To get the quantity discount advantage. Prices will not remain constant throughout the year; it may fluctuate from time to time. so to get the advantage of low price it is necessary to keep inventory. Purchasing of raw material takes time. Some time is elapsed between placing an order and receiving it. So to reduce purchasing lead time inventory is helpful. To overcome from the shortage problem inventory control is necessary.

b. Calculation of EOQ and Safety stock: EOQ: Economic order that quantity ordered at which the total orderind costs and inventory carrying costs will be the minimum.alternatively it is called as Economic lo size.If orderd are placed for a relatively small quantity frequently,the company will have to place orders again and again during a year,consequently it will have to incur considerable costs in the form of transportation cost and clerical expenses.

EOQ = 2CODCi Where EOQ=Economic order quantity Co=Ordering cost D=Demand Ci=Inventory carring cost

c. Inventory Classification: -ABC System -VED system -SFN system In himson.pvt.ltd,They use VED system to classification of their inventories.VED System: This type of analysis divides items of stock into three categories that is in the descending order of their criticality. Here,V= stands for vital items and their stock analsis requires more attention because out of stock situation will result in stoppage of production. Thus V items must be stored adequately to ensure smooth operation of the plant. E= means essential items. Such items are considered essential for efficient running of the concern but without these items the system would not fail. Care must be taken to see that they are always in stock. D= stands for desirable items which do not affect the production immediately but availability of such items will lead to increase in efficiently and reduction of fatigue

Inventory classification in himson.

Sr NoMaterial classCodeseriesw/hcodeStorage

01Allu. casting extrusionA22Floor & rack

02BearingsB21/26Cupboard

03C.I.CastingC22Floor & rack

04Electrical motorsJ21Floor

05Electrical itemE24Floor & rack

06Electronics itemI25/28Floor & rack

07Finished goodsF & H27Floor & rack

08Finished itemF21/26Floor & rack

09General [packing item] P21/26Floor

10Hard waresH,F, & Z21/26Floor & rack

11Paints & oilsP21/26Floor & rack

12Semi finished goodsS21/26Floor & rack

13StationeryQ21Rack top

14Steel [gas cut]D22Floor & rack

15Steel[raw]R22Floor & rack

16toolsT21Cupboard

FLOWCHART OF WORK INWARDMaterial details entered in Register Format No. F : IW : 04Verification of Material / Quantity as per Challan. Material identification by tag Format No. F : IW : 02 Prepare GRN F : IW : 01Prepare Inward Note F : IW : 03Prepare Cash Inward Note F : IW : 05Received Material from vendor with challan and billGRN with material to inspectionInward Note with material to concerned Dept.Cash inward Note with material to concerned Dept.

3.6 Quality control:a. Objectives of quality control

The main objective of quality control is to satisfy the functional & or aesthetic needs of end users/customers of goods or services. The other objectives derived from this main objective are as following:1. To clearly define top managements commitments towards quality and production.2. To design the product which has futures as required to satisfy the needs.3. To keep the features of the product within specified limits as predetermined.4. To ensure consistency of quality by measuring and controlling it: there by to maintain the reliability of the products.5. To balance the costs of inspection of quality and benefits of quality control.6. To involve and train employees in quality control activities.7. To help vendor development by quality control of incoming raw materials and components.

b. Techniques used for quality control: The Quality policy of HIMSON TEXTILE ENGINEERING IND.PVT.LTD. Shall be.

We, at Himson Group, are dedicated to continual improvement of our products and services. Our focus is customer satisfaction at all times, and striving to exceed his expectations.We will always comply with our quality management system and improve its effectiveness, by establishing performance objectives for our product and people.

DT. 01/01/2010 Bhogilal H. Bachkaniwala Managing Director

The above quality policy has been explained to all employees of the organization through displays, training and suitable method to ensured that Quality policy is Understood and implemented at all levels of organization. Any new person joining our organization is made aware of the quality policy. He is also explained the quality objectives of the organization.c. Guidlines follow for Quality Control:

1. Certification against QMS ISO-90022. 3 D Coordinate Measuring Machine3. Measuring & Testing Equipments for large size components up to 2000 mm4. Standard Room for in-house calibration of Measuring & Testing equipments5. Laser Interferometer for CNC machine Tools CalibrationHelium Leak Detector (Mass Spectrometer)

Flow chart of material inspectionInspection Surface TreatmentIf RequiredMaterial loading on Machine wit h Route Card, Drg. & Job card

RejectRework

Required Operation done as per Drg. & Route CardStoreInspection Reject

Rework

Regrade or Scrap

Regrade or Scrap

Dispatch

FailPass Fail

Fail pass

3.7 Cost control:a. Classification of various components: Labour costs:

Satndard time developed by time studies,predetermined time standards or work sampling,often from the basis for labour cost standards if they work at a normal place. The standard labor cost for a particular unit of activity is then the summation of the standard times multiplied by the base labor rate. Material costs:

The efficient use of material is the concern of much design and value engineering effort as well as production control effort. Material requirements for a given product are typically specified on engineering drawings or production control documents. Overhead costs:

Some elements of overhead cost,such as building depreciation aere fixed costs whereas other components such as supervision,maintainance and factory supplies are often classified as variable V or perhaps semi-variables SV.

3.8 work Study:

It is a method to examine human work, material resources and critical examination of all factors, which affects the efficiency of the organization. It includes analysis of method study and time study.

In Himson Pvt. Ltd., there is not any perfect system for analyzing the time required to do the job by the worker and also do not critically investigate the resources. The main reason for it is that they produce according to order received from the customers.

There are some machines which are automatically controlled i.e. they are computerized and some machines are manually handled. There is less idle time in automatic machines because it is totally programmed by computer.

In Himson Pvt. Ltd., at CNC Machine Center one machine is from Feeler Company of Taiwan. In this machine idle time is zero and it one of the advantageous matter for Himson Pvt. Ltd.

CHAPTER-4

HUMAN

RESOURCE

MANAGEMENT

4.1 Introduction:a. basic introduction about HR department:Human resource is an integral part of management process which is concerned with equipping every class of work force working at different level of organization with knowledge ,intelligence experience skills values attitudes etc. with an objective of motivating them for effective and efficient goal achievement.Human resource department is also very essential part in management of the Himson Engineering pvt.ltd.. there are number of workers in this company, who are working with one another with the help of magnificent and decent human resource system.They have been achieving the set target and goals since last few years, just because of their consistent coordination and healthy interaction among the workers who are working in the Himson Engineering pvt.ltd. They are given adequate responsibilities from the top management and that is the reason they are achieving best result, which helps them in achieving their goals.

b. total numbers of employers & total numbers of branches.The company has about 1200 employees on its rolls, of which, about 150 (13%) are Management/Executive staff and 150 are technical staff. There are about 150 ancillary units owned by qualified engineers. This has helped the company easily absorb the latest technology and adopt the same to meet the global requirement. There are about 11 sales executives from different cities of the India and their qualification mostly with textile engineering with MBA.Following are the branch of HIMSON.:

a. To study organizational structure:

d. To study the activity of HR manager: MANAGER: A manager is a person who completes his/her task through the available resources. His/her style should be leadership through demonstration. A manager should be able to manage the matters of the organization effectively & efficiently. ACTIVITY OF MANAGER: -

Communication: It is a process through which an information, idea or opinion is transfered to more number of persons. It is defined as a process of exchanging the facts, ideas, opinions, symbols, messages, emotions by two or more persons. It is helpful for smooth working increasing in the managerial efficiency, decision-making, maintaining industrial peace, public relation and saving in time to the organization. In communication following points are important: Language Two way communication Code Contents of the message Clarit

Motivation: Motivation is an urge or tension to move in desired direction or to achieve certain goal. This is an effective tool for getting critical tasks completed within specified (desired) period &/or in desired manner.

Decision Making: What, when, where, why, by whom & how a specific job or a part of the job is to-be done these are the most of the decisions a manager has to take. Correctness of the decision depends of on the information & the knowledge the concern manager is holding.

Co- ordinatination : Large scale of Himson Engineering Pvt.Ltd recruits a large number of personnel. They are working on the basis of division of the work and specialization. Here is a need of synchronizing the different activities being carried out by different individuals /groups /departments /division.This synchronizing technique is called co-ordination. The co-ordination is effectively done through decision-making, communication & motivation.

Development: This involves development of self as well as the sub-ordinates.One has to develop both his/her self & sub-ordinates, so that one can take more or extra responsibilities by empowering own sub-ordinates. This can be the most beneficial to all i.e. to the organization, to the boss & to the sub-ordinates.The organization can allot maximum responsibilities to a single reliable manager. The manager can become capable of taking charge of the areas other than his field & can widen his scope of promotion.

The sub-ordinates get chances for up-liftment, which can be a great motivation.

4.2 Human resorse planning:a. human resource plaaning process:step 1. clarification of objectives:

HRP begins with clarification of its objectives.well defined objectives provide direction to personnel efforts and guidelines for making personnel decisions.

Step 2. Estimating the future requirements of human resources:1. Employment trends.2. Need for filling the vacancies.3. development. 4. productivity.

Step 3. Collection of information regarding present human resources:1.man power inventory.2.Skills inventory.3.Human resource audit. Step 4. To determine job requirements.Step 5. Estimating human resource supply.Step 6. Preparation of human resources plans for implementation of HRP.

b. Job description &job specification of the various positions in the organisation.

Job Analysis: They use different measures for job analysis. Especially for allotment of job, they emphasis on any of following first three points with the fourth most important one: Qualification: A person should be educationally qualified for the job to be done. Experience: A person has earned the capacities of doing job through experience OR Attitude: With any one or more of the above three criteria, this one is the most essential point. An attitude is a status of mind or feeling that includes predisposition to behave in someway. A tangency or a predisposition to evaluate an object or symbol of that object in a certain way.

4.3 Recruitment and selection:

Recruitment :In Himson Engineering Pvt.Ltd . the process of finding and attracting capable applicants for employment . The process begins when new recruits are sought and ends when their applicants are submitted.

Selection :It is the process of differentiating between applicants with a greater likelihood of success in a job.

a. Himson pvt.ltd. uses external source of recruitment & its advertisement: Advertisement:Himson pvt.ltd. gives advertisement in different news papers & business managines and recruit employees.b. Factors affecting recruitment: when company required new talent. when present employees leave the company. at the time of expansion. At the time of boom period of product life cycle.

c. selection process: The process for the recruitment & selection of Himson Engineering Pvt.Ltd is given below:

Step 1.Receiving Application: Himson Engineering Pvt.Ltd receive applications from the prospective candidates. The main purpose of the application is to obtain information in the applicants' own presentation regarding his suitability for the employment. In Himson Engineering Pvt. Ltd . applications are received through the reference of employees and directors and also with the help of employment service providers.

Step 2.Screening: In Himson Engineering Pvt.Ltd Screening means critical evaluation of received applications. After receiving the applications, the next stage is to screening of that application. The main object of screening is to abandon further consideration with the specification of the job. The screening ideas are expected to be favorable to the most suitable to the job. Step 3.Primary Interview: The main objective of primary interview in Himson Engineering Pvt.Ltd is to short out the unqualified candidate due to lack of certain requirement in education, age, experience etc. If an applicant is shorted out in the early stage of selection procedure, the company can save the expenses and time of processing him through remaining steps of procedure.In Himson Engineering Pvt.Ltd, they ask the applicants' family background, history, hobbies, and interest etc. Here in Himson Pvt. Ltd., all the selected candidates are checked in the both of the stages.1. Primary2. Secondary

Step 4.Written Test: Himson Engineering Pvt.Ltd also take written test for parameters, which includes logical reasoning, general english, numerical questions, general knowledge, aptitude test i.e. aptitude is for checking whether the candidate is capable to work in the field or not and also to check his depth in the relevant field. Communication skill and presentation skill are checked for that essay writing is also included in this test.

Step 5.Personal Interview: After going through written test, in Himson Engineering Pvt.Ltd , they take their aptitude and attitude test on the basis of their hobbies and other social interest. They give more importance to these two points with other relevant questions of relevant fields. Step 6.Final Approval: When all tests, interviews, etc. are over a summary report is prepared and is for ended to the authority with suggestions for his approval or advice.Step 7.Placement: The selected candidate is placed on job for which he/she is selected.

Process of recruitment & selection of Himson Engineering Pvt.Ltd :

In Himson Engineering Pvt Ltd., first of all decided how many number of personnel are to be contacted and what type of personnel to be contacted. Then after they decide area from where they will get their employee. They looks employees at internal recruitment, present employees, employees referral, professional association, advertisement, campus recruitment, Radio& television etc. They starts finding the employees before two months ago from their required time. Then after screen out employee and decides whether they are applicable to do the job or not. In this step, preliminary interview is to be taken, in this interview general question is asked and check the capability of the applicant. Employment interview is to be taken and the applicant who passed all above step is selected. Job is offered to selected applicant through letter of appointment.

4.4 Training and development:

Training ProcessTraining is a short term process utilizing a systematic and organized procedure by which non-managerial personnel learn technical knowledge and skill.Training helps the persons to improve their knowledge and skill. This is self development process. Training based on learn & teach. Training puts its meaning powerful when it receives a positive and better feedback from trainees. The complete system of Himson Engineering Pvt.Ltd..

Need of training in Himson Engineering Pvt.Ltd :

To improve knowledge & skill. To develop attitude & behaviour. Reduced cost, accident and mistake. Increase efficiency To increase productivity Imparting information on new technology and methodology. To maintain industrial relation.

Infrastucture of Himson Engineering Pvt.Ltd for training department :Whatever the things and materials, facility required for imparting training. Training room/Seminar room. Board Chair OHP (Over Head Project) VCR, CD Player Television Audio deck karaoke facility. Automatic slide projector Computer with multimedia facility Video projector demonstration for technical guidance. Picture and feature for illustration

4.5 Performance appraisal system:"Performance Appraisal means systematic evaluation of the personality and performance of each employee by his supervisor or other person trained in the techniques of performance appraisal."Himson Engineering Pvt.Ltd does not follow any formal performance appraisal system. The supervisor himself evaluates his subordinates practically while he is performing his job.

4.6 Promotion and transfer policies: Transfer And Promotion of Himson Engineering Pvt.Ltd: TRANSFER: "Transfer involves change in a job or job location of an employee without a change in level of responsibilities or remuneration. A transfer differs from a promotion."In Himson Engineering Pvt.Ltd, transfer is done for the following reasons:1. Opportunity for the employee at the other place.2. Person is more capable or suitable for other specific job i.e. he can work better on other place.3. New post/ vacant post: -For the new post or a post is vacant because of any reason a person capable of taking responsibility can be suited with his work.4. Person not capable for present job.

They include two types of transfer:

Inter-Unit: -It means an employee is transferred within the units.For example: An employee working in A. K. Road Unit is transferred to Borsara Unit.

Inter-Department: It means an employee is transferred within the departments.For examples: An employees working in marketing Department of Borsara machines is transferred to the HRD Department of Borsara machines.

PROMOTION: "A promotion is a transfer of an employee to a job which pays more money or one that carries some preferred status."In Himson Engineering Pvt.Ltd, they give promotion on the basis of merit. Main advantages of merit are:1.) Generates greater motivation2.) Increase Productivity3.) Recognize and reward the extra knowledge and capacities4.) Scientific and logical systems for promotion5.) Increases the profitability and efficiency of an organization.

4.7 Wage and salary: Wages & Salary Administration of Himson Engineering Pvt.LtdCompensation or Remuneration is the reward in monetary terms or in the forms which can be express or understood in monetary terms payable to or paid to employees for the services rendered by them to the organisation. It includes such areas as job evaluation, survey of wage and salaries analysis or relevant organizational problems, development and maintenance of wage structure, establishing rule for administering wages, wage payments, incentives, wage changes and adjustments etc.While deciding the structure of wages and salaries, Himson Engineering Pvt Ltd. follows Basic wages Provident fund Attendance Special allowances Overtime House Rent allowance Convenience allowance

All above factor are being taken in mind while deciding wages & salaries of employees. In case of time rate wages, its decided based on attendance of particular employees. In Himson Engineering Pvt Ltd. wages or salaries will be paid on 7th day of each month

Incentives & Motivation System of Himson Engineering Pvt.LtdIncentives are payment plans which provide encouragement by extra payment over and above regular time rated remunaration for the extra performance.in Himson Engineering Pvt.Ltd To get desired or targeted result, himson can provide extra remunaration for better performance of employees. In other words, an incentive scheme is a plan or programmes to motive individuals or group performance.Himson Engineering Pvt Ltd. and other company also use certain incentives to motivate its employees. Motivation means to force a person and involve him to complete the work in right time and place with help by providing a basic need or special need to worker. Specially Maslows need hierarchy used to motivate employees such as basic need, special need, safety need, recognize, identify, self realization.Extra salary is one such type of incentive which is given to those employees who show sincerity and regularity throughout the year in their work. Salary is the main factor to motivate employees. Safety need is also used to complete the work.

4.8 Employee welfare activities:Welfare facility of Himson Engineering Pvt.Ltd:Welfare facility means the facilities which supports the employees to satisfy their needs like medical facilities, schools and kinder garden for their children, sports, canteen, transportation facilities, colony for their housing facility.In Himson Engineering Pvt.Ltd, they give all these facilities. There are no recreational facilities but as & when worker required it, they provide or support to the employees. Leaves are given to them are 26 as per rules within the year.

Safety to employees of Himson Engineering Pvt.Ltd: -They provide safety for employees like special dresses, hand gloves and spectacles while working in the factory etc.Lift,, fire alert system camera?????,,,, Insurance scheme: Himson Engineering Pvt.Ltd, provides insurance schemes is W.C. i.e. Workman Compensation which is applied to the managerial staff also including insurance. Trade Union: ~As per the section 2(B) of the Indian Unions Act of 1920, a trade union is any combination of persons whether demography or permanent primarily for the purpose of regularity, the relation between the employees & employers & for imposing restrictive conditions on the conduct of any trade or business & includes the federation of two or more principles of trade union.There is no trade union in Himson Engineering Pvt.Ltd. They apply open door policy i.e. to contact directly to the personnel manager or/and director if any employee has any grievance. As there is no trade union, there is no matter of collective bargaining. If any employee has any grievance, they solve it by one - to - one bargaining.

Grievance Handling: - Grievance means dissatisfaction may happen for any reasons like promotions, payment of wages and salary, leave, transfer, bonus etc. This grievance is removed properly or by proper procedure known as grievance handling procedure.In Himson Engineering Pvt.Ltd, the grievance handling system is handled by supervisor. In Himson, grievance handling process subject to following three steps:1. The employees are supposed to submit his grievance to verify to his immediate boss & the supervisor is supposed to give answer or fulfill the grievance within 3 days. If the worker is not satisfied then he can submit his grievance further.

2. In this step the aggrieved workman can submit his grievance in writing to the senior officer of the department & the officer is required to reply within 7 days. Here also if the employees are not got proper answered or not satisfied then he can submit his grievance further.

3. The grievance forward to secretary of the grievance committee or in monthly meeting of union management by the senior officer of the concerned department.

After finishing these steps, if the workers are not satisfied then they should have the right to appeal to chairmen & managing director when they may examine the matter.They also handle grievances by councilling.

CHAPTER-5

FINANCE

DEPARTMENT

Introduction:

When a person thinks to do any typical economic activity or transaction, he must first think about sources of money as a means of transaction. It is not only important to economic activity but also to business.The importance of the finance in the business is similar as the importance of the spring in the clock. Finance is required from the starting of business until it terminates, as a means of the business transaction. Finance is the lifeblood of the business enterprises. Finance is the first & foremost need of any unit.Financial management is that managerial activity which is concerned with the planning & controlling of the firms financial resources as a separate activity displain. It is of recent origin.In Himson Pvt. Ltd., there is finance department. It is handled by the top-level management. At A. K. Road unit, there is a separate finance department like other departments in the organization. Mr. I. K. Laiwala and Miss Forum are finance controller. Most of the important financial decisions and some policies are taken by them.

5.1 Detailed organizational structure of finance department:

5.2 Cost sheet

A. Unit Cost:

It consist two types of cost. 1.Raw material cost. 2.Labour cost.

1. Raw material cost:-a. Raw material cost-discount(if any as per approved purchase order)b. Excise Duty (paid to central government)c. Taxes .d. Freight, transportation and rejection.

2. Labour Cost:-a. Outstanding labour cost.b. Inhouse labour cost includes I. PowerII. Direct labour..m/c operator*wage earning rate.III. Indirect labour..wages/salary related involvement in production.IV. Consume oil, spares, inserts, electronics in m/c.V. Overheads 1. service department, salary, factory expences, repair and maintenance, adm. overheads etc.VI. Machinery dept. for 1 shift 4.75 per year, for 2 shift 7.42 per year.VII. Rejection etc.

B. Calculation through computer programme:-

I. Raw material cost(item wise) Inward item wise/ vendor wise, record during period. Showing basic rate/excise/taxesas per order.II. Assembly cost Item required in assembly as per planning*cost/itemIII. Labour cost O/s labour cost as per item wise/vendor wise.IV. Rate rs.*operation time/itemwise/machine wiseas per planning department.

5.3 CASH FLOW STATMENT

For the year ended 31-3-2010 amount in rs.For the year ended 31-3-2009 amount in rs.

ACash flow for operating activity

Net profit before tax &extraordinary items168257261642536

addAdjustment for

Depreciation113740999502365

Loss on sale of asset -3400

Previous year adjustments2207643

MAT Credit entitlement5049474

Exchange rate difference24034829336

Preliminary expenses4540445404

1870065410380505

lessAdjustment for

Other income68571276783689

Previous year adjustments279762

Profit on sale of shares/mutual fund46786664870753

1153579311934213

Operating profit before working capital changes

23990587

3196245

addAdjustment for

Increase in current liability & provision111382345

Decrease in inventory78724717

Decrease in deposit & advances77589705

Decrease in sundry debtors7127717411962598

227591597123344943

lessAdjustment for

Increase in deposit & advances62724539

Decrease in current liability & provision156685790

Increase in inventory87867010

156685790150591549

Cash generated from operation9489639430442851

LessProvision for tax3086222286028

Net cash from operating activitiesA9181017330728879

BCash from investing activities

AddAdjustment for

Other income68571276783698

Sale of investment1026291016823001

Decrease in loan advanced220220374000

Decrease in fixed assets3821812012461

lessAdjustment for

Purchase of fixed assets6217086729962640

Increase in investment102973331

16514419829962640

Net cash used in investing activities B5505556913960480

CCash flow from financing activities

AddAdjustment for

Increase in share capital8823100

Increase Share application money

Increase Secured loans1073459039523739

Increase Unsecured loans30000000

1955769069523739

lessAdjustment for

Decrease Share application money8823100

Decrease Unsecured loans30000000

Decrease Miscellaneous expense2008936

388231002008936

Net cash used in financing activitiesC1926541067514803

DExchange rate differenceD24034829336

Net increase in cash & cash equivalentsa+b+c+d

17465159

21996109

cash & cash equivalents9009672168100612

cash & cash equivalents10756188090096721

Cash & bank balances

Cash on hand10623021075050

Balance with bank

In current account4465064232084009

In deposit account6184893656937662

Total10756188090096721

5.4 Working Capital Management Management of working capital is an extremely important area of financial management as current assets more than half of the total assets of a business. Fixed assets through essential for a business organization, does not by itself produce revenue or income. Fixed assets act with current assets to generate revenue or income. Therefore, working capital is necessary for utilizing the productive capacity of fixed capital. For shortage of working capital, the enterprise would suffer reduction in earnings due to productive capacity remain unutilized. While, excess working capital leads to extra cost for want of productive capacity. Thus, the amount of working capital in every enterprise, whether manufacturing or non-manufacturing, should be neither more or less than what is actually required.Working capital in business is just live blood in human body. Optimum and appropriate movement of blood through the body is extremely necessary to continue life. Like human blood, the proper circulation of funds (working/circulating capital) is utmost necessary to continue business. If the circulation of working capital becomes weak, the businesses can hardly prosper and service. An enterprise should maintain optimum amount of working capital so as to carry on the productive and distributive activities smoothly. While, the determination of optimum level of working capital involves fundamental decisions to an organizations liquidity, which in turn are influenced by a trade off between profitability and liquidity.Thus, goal of working capital management is to manage the firms current assets and liabilities in such a way that satisfactory level of working capital minted.

a. MANAGEMENT OF CASH: -Cash in the important current assets for the operations of the business. Cash is the basic input needed to keep the business running on continuos basis, it is also the ultimate output expected to be realized by selling the service or product manufactured by the firm. The firm should keep sufficient cash, neither more or less. Cash shortage will disrupt the firms manufacturing operation while excessive cash will simply remain idle, without contributing anything towards firms profitability. Thus, a major function of the financial managers is to maintain a sound financial position.Cash management involves following four factors: -I. Ascertainment of the minimum cash balance and controlling the levels of cash.II. Controlling cash in flowsIII. Controlling cash outflowsIV. Optimum interment of surplus cash.

Cash is required to meet a firms transactions and precautionary needs. A firm needs cash to make payment for acquisition of resources and services for the normal conduct of business. It keeps additional funds to meet any emergency situation. Some firms maintain cash for taking advantages of speculative changes in price of input and output.

evaluation of cash management performance: -The following ratios have been used to evaluate different aspects of cash management.(1) Cash to Current Assets Ratio.(2) Cash turnover Ration.(3) Average age of Cash.The figures of cash and Bank Balance, total current assets and current liabilities for the year 2000-01to 2002-03 are given in the table.

Cash Management in Himson Pvt. Ltd.ITEM2007-082008-092009-10

1 Cash& Bank Balance6810061290096721107561880

2 Total Current Assets213016302261885017208224149

3 Total Current Liabilities11510650123130647270688700

Ratio (%)

a) Cash to Current Asset Ratio (1/2)0.3193.440.51

b) Cash Turnover Ratio (3/1)1.692.564.025

c) Average age of cash (365/b) days215.97142.5790.68

(Table 8)

b. Management OF RECEIVABLE: -When firm sell goods for cash, payments are received immediately and therefore no receivables are created. However when a firm sells goods or services on credit, payments are received only at a future date and receivables are created. It is an essential marketing tool in modern business trade. Credit creates receivables, which the firm is expected to collect in near future. A firm grants credit to its customers so that its sales are its customers so that its sales are not lost to competitors.Account receivable constitutes a significant portion of the total current assets of the business after inventories. The receivables arising out of credit has three characteristics.I. It involves an element of risk, which should be carefully analyzed.II. It is based on economic value. To the buyer, the economic value goods or services pass immediately at the time of sale, white the seller expects an equivalent value to be received later on.III. It implies futurity. The customers from whom receivables have to collected in future are called debtors and represents the firms claim or asset.

Debtors Turn-over Ratio: -This is also called Debtors velocity or Receivable Turnover. A firm sells goods on credit and cash basis. When firm extends credit to its customers, book debts are created in firms A/c debtors expected to converted in to cash over short period and thus included in current assets. It is used to measure liquidity of the receivables or to find out period over, which receivables remain uncollected.Receivable turnover Ratio Total Sales= ----------------------- Average Debtors Debt collection period 365 = --------------------------Receivable turnover ratio

Receivable Management in CompanyYearSalesAvg. DebtorsRatioCollection Period

2007-0892793755150998182.520.61117.7

2008-0946492658145016883.510.3335.33

2009-108369565579378296.589.244.09

(Table 7)

b. Management Of Inventory: -Inventory constitute major portion of current asset of public Ltd. Companies in India .The manufacturing companies hold inventories in the form of Raw material, work-in-process and finish good,There are at least three motives for holding inventories.(1) To facilitate smooth production and sales operation (Transaction motive)(2) To guard against the risk of unpredictable changes in usage rate and delivery time (Precautionary Motive)(3) To take advantage of price fluctuations. (Speculative Motive)

Inventories represent investment of a firms funds and that is why management of inventory is necessary for the maximization of the value of the firm. The firm should therefore consider (a) Costs (b) Return (c) Risk Factors in establishing its inventory policy.

Evaluation of inventory management performance: Ratio analysis has been used for making evaluation of Inventory management performance. As the raw material used in the company is pig iron, proper planning and handling is required for the purpose of achieving the right quality of output.The ratios for last three years have been worked out and compared. The various figures are given in the table.

INVENTORY MANAGEMENT IN HIMSON .ITEM2007-082008-092009-10

1 Average Inventory329550.5331822.5414866

2 Total Current Assets92918910867291327797

3 Cost of Good Sold76087289134915207147

Ratio (%)

a)Inventory to Gross Working Capital (1/2)0.350.300.31

b)Inventory Turnover (3/1)2.312.693.67

c)Inventory Conversion Period (365/b) days15813699

Balance sheet

SCHEDULEAs at 31-3-2008As at 31-3-2009As at 31-3-2010

ASource of funds

1shareholder's fund

(a) share capitalA199250001992500038710600

(b)share application money8898100889810075000

(c)reserves & surplusB125217782123415143130537813

2loan funds

(a)secured loansC69338485108862224119596814

(b) unsecured loansD110410394140410394110410394

3deferred tax liability4056873911452

Total334195448401510861403242074

Bapplication of funds

1fixed assetsE

(a) gross block36090246A4372168586435966210

(b)less: depreciation295188592288010300299384398

(c )net block6571387284158286136581812

2InvestmentsF553290625336781458390710

3current assets, loan & advancesG

(a)inventories121656743209523753130799036

(b)sundry debtors1019963659003376718756593

(c)cash & bank6810061290096721107561880

(d)deposits, loan & advances4456095410691149329101568

336314674496565734286219077

less: current liabilities & provisionsH

(a)current liabilities11510650123130647270688700

(b)provisions819187233742467306229

12329837323468071877994929

4net current assets213016302261885017208224149

5miscellaneous expenditureI1362122099974445404

Total334195448401510861403242074

Profit and loss account

scheduleAs at 31-3-2008As at 31-3-2009As at 31-3-2010

1Income

(a)sale/income from operationJ927937551464962581863956557

(b)other incomeK79865871165445111535793

(c)increase/(decrease)in stockL17325875-17030170-223566

total953250013459586862875268784

2Expenditure

material consumedM810582496365998510717757831

manufacturing & operating expensesN572045304405362448800575

employee's remuneration &benefitsO235106122609921233716076

sales & administrative expensesP164181411174663413754868

preliminary expenses written off454044540445404

total907761183447943384814074754

3profit before financial chrg; dep & tax454888312060747834194030

financial expensesQ4924719127476505994205

4profit before depreciation & tax40564111785982828199825

less: depreciation537271795036511374099

5profit before tax35191394-164253616825726

less: provision for taxation

current income tax45167723086222

deferred tax189820-4056873911452

fringe benefit tax213655286028

6profit after taxation30271147-15228779828053

add: balance brought forward5043589110367730108565091

less: previous year adjustment561451279762-2207643

add: MAT credit entitlement5049474

balance carried to balance sheet34753285108565091125650261

Common size statement ScheduleAs at 31-3-2008As at 31-3-2009As at 31-3-2010

ASource of funds

1shareholder's fund

(a) share capitalA5.9624.9629.599

(b)share application money2.6622.2160.0185

(c)reserves & surplusB37.46830.73732.372

2loan funds

(a)secured loansC20.74727.11329.658

(b) unsecured loansD33.03734.97027.380

3deferred tax liability0.1210.970

total100100100

Bapplication of funds

1fixed assetsE

(a) gross block107.99192.692108.115

(b)less: depreciation88.32871.73174.244

(c )net block19.66320.96033.870

2InvestmentsF16.55513.29114.480

3current assets,loan & advancesG

(a)inventories36.40252.18332.436

(b)sundery debtors30.51922.4234.651

(c)cash & bank20.37722.43926.674

(d)deposits,loan & advances13.33326.6277.216

100.634123.67470.979

less:cureent liabilities & provisionsH

(a)cureent liabilities34.44257.60917.530

(b)provisions2.4510.8401.811

36.89458.44919.341

4net current assets63.74065.22451.637

5miscellaneous expenditureI0.0405.2300.011

total100100100

ANALYSIS THROUGH RATIOS: -

The ratio analysis provides guides and clues especially in sporting trends towards better or poorer performance and in finding out significant deviation for any average or relatively applicable standards.The following are the important ratios to measure the current financial status

1. Ratios relating to liquidity of working capital: -Liquidity ratios are used to measure the ability of firm to pay its maturing obligation in time. This ratio helpful for both short-term creditors and internal management of the firm. The following are types of ratios relating to liquidity of working capital.A.REVENUE STATMENT RATIOa. gross profit ratio G.P *100= -------------------- net sales2007-08 360902464*100= -------------------- 927937551=38.892008-09 372168586 *100= -------------------- 464926581=80.042009-10 435966210 *100= -------------------- 836956557 =52.08Interpretation: In the year 2006-2007 the G.P ratio is low, so it indicates that the cost of sale is high or that the purchasing is inefficient. In the year 2007-2008 and 2008-2009 these ratio is consequently increasing.

b.NET PROFIT RATIO N.P. *100= -------------------- Net Sales 2007-08 65713872 *100= -------------------- 927937551=7.082008-09 84158286 *100 = -------------------- 464926581=18.102009-10 136581812 *100= -------------------- 836956557=16.31Interpretation: This ratio is used to measure the overall profitability. It is generally fluctuating and very less. Managers have to try to increase it.

c.operating ratio COGS + Operating *100 = -------------------- Net SalesCOGS = opening stock + purchase closing stock2007-08 810528496+73622671*100= --------------------927937551 =95.28

2008-09356998510+55800258*100= -------------------- 464926581 =88.782009-10 717757831+62555443 *100= -------------------- 836956557=93.23 Interpretation: This ratio shows the efficiency of the management. The higher the ratio, the less will be the margin available to proprietors.

d.expenses ratio1.administrative ratio

Administrative expenses *100= -------------------- Net Sales

2007-08 16418141 *100= -------------------- 464926581 =3.53 2008-09 11746634 *100= -------------------- 464926581 =2.5262009-10 13754868 *100= -------------------- 836956557=1.64Interpretation: This ratio reveals the relation of different expenses to net sales. In this ratio the lower the ratio, the greater the profit. So if company wants to increase the profit it has to try make to lower expenditure.

2.financial expenses ratio Financial expenses *100 =------------------------------- Net Sales 2007-08 4924719 *100 = -------------------- 927937551=0.53

2008-09 12747650 *100= -------------------- 464926581=2.742009-10 5994205 *100= -------------------- 836956557=0.716

3.Current Ratio: -It is most common measure for measuring liquidity. It is also called Working Capital Ratio. It expresses relationship between current assets & current liabilities. Current assets = -------------------- Current liabilities 2007-08 213016302= -------------------- 115106501=1.85 2008-09 261885017 = -------------------- 231306472=1.1322009-10 208224149 = -------------------- 70688700=2.94The acceptable norms for this ratio is 2:1 considering this it can be said that company has maintained sound ratio over three yearInterpretation: Current ratio is increasing year by its 1.08 in year 2006 and increases by 0.18 in year 2007 i.e. 0.90 which increases by 0.34 in 2008 i.e. 1.24.It is satisfactory for the company.

4.liquidity ratio Liquid assets = --------------------liquid liabilities 2007-082007-08 213016302 - 95947064 = --------------------115106501=1.01

2008-09 261885017 195879321 = -------------------- 231306472 =0.285

2009-10 208224149 125253893 = -------------------- 70688700=1.173

Interpretation: Its optimum ratio is 1:1. In the year 2009 its liquidity position is improved.

e.propritary ratio Share holders fund= -------------------- Total assets

2007-08 154040882 = -------------------- 334195448 =0.402008-09 152238243 = -------------------- 401510861=.379

2009-10 169323413 = -------------------- 403242074 =0.4199Interpretation: This ratio below 50% alarming for the creditors since they may have to lose heavily in the event of factorys liquidation on account of heavy losses.However company recovered its ratio in year 2009.

f.debt-equity ratio Long term debts = --------------------Share holders fund 2007-08 78420987 = -------------------- 154040882 =0.502008-09 90033767 = -------------------- 152238243=0.59 2009-10 18756593= -------------------- 169323413 =0.110Interpretation: Higher the ratio means that outside creditors have a large claim than the owner of the business. In the 2009 ratio is somewhat reduced.g.return on shareholder ratio Net profit *100= --------------------Share holders fund 2007-08 65713872 *100= -------------------- 154040882=42.662008-09 84158286 *100= -------------------- 152238243=55.282009-10 136581812 *100= -------------------- 169323413=80.66h. Debtors Turnover Ratio: -This ratio shows the period of which receivable remain uncollective. The ratio is doubled in 2002-03 as compared to 2000-01. So serious steps should be taken to reduce the collection period though sales increase. Debtors + Bills receivable *365= --------------------Net credit sales

2007-08 78420987 *365= --------------------927937551=30.8462008-09 90033767*365 = -------------------- 464926581= 70.6822009-10 107561880 *365= -------------------- 836956557=46.908Interpretation: Higher the number of collection days more unsatisfactory for the company.

h.total assets turnover ratio Sales = -------------------- Assets

2007-08 927937551 = -------------------- 334195448=2.776

2008-09 464926581 = -------------------- 401501861=1.157

2009-10 839656557 = -------------------- 403242074=2.082

There are some job qualifications and experience which are required for- some posts or designations. So here the appropriate and minimum job qualification and experience for the appropiriate designations is given below: Conclusion: -

During my industrial training at Himson Textile Engineering Industries Private Ltd., I found that there is co-operative managerial staff & workers & also good & efficient management in each & every department & workers are fully satisfied with their management because the main purpose of Himson is to achieve their goals involving each & every employee. Since its establishment, it has been profit-making organization.

In India during 1992-1995 they had monopoly in texturising manufacturing which gives benefit to them today also. The end customer of Himson can also earn good profit by using their machineries.

Company Profiles

Himson Textile Engineering Industries Pvt Ltd. is the flagship company of the Rs. 4.0 Billion Himson group. About 50 years ago, Himson started its activities with only few looms to manufacture quality fabrics. Since then the group activities have grown from strength to strength. Firstly Himson concentrated on expansion in the loom shed and subsequently dyeing and finishing houses were added for further growth through integration. For diversification of the product, further lace and embroidery units were established. Till this time growth was slow and steady with focus only on textile.[1970] Onwards

In the 1970, the main focus was moves towards high growth. At this time, the company saw the opportunity for manufacturing synthetic yarn, processing machineries. The market for these products was large but untapped. The seeds for these were shown with the commencement of manufacturing of up twisting and rewinding machines and Himson Textile Engineering Company Ltd. came in to being.

[1978] TIE UP WITH EARNEWST SCAGG.

In 1978, the company came on the fast track. But the real momentum to growth was provided in 1978, when Himson Textile Engineering Company Ltd. tied up with Earnest Scragg Sow Ltd., U.K. to manufacture draw texturising machines in India. Then, the company satisfied the local requirements by the way of getting best technology which was available in abroad. This strategy has been performing well and has made the company an undisputed leader in synthetics yarn processing machinery. This has been achieved by capturing almost 85% market share in spite of big competition from leaders. Synthetics yarn-processing machinery has been accepted leadership by leading POY manufactures by placing large quantity of machine orders. Himson Textile Engineering Company Ltd. provides efficient and prompt after sale service to the customers so that Himson Textile Engineering Industries Pvt Ltd. also enjoys high reputation for in house research and technology developments. Himson Textile Engineering Company Ltd. has captured more than 70% of the domestic market share to supply synthetics yarn machinery.

[1997] TURNOVER TOUCHES Rs. 3 BILLION

The turn over of Himson Textile Engineering Industries Pvt Ltd. 1974 6.0 Millions1989-90 4.0 Billion (the group of company) 1996-97 3.0 Billion (Himson Textile Engineering Industries Pvt Ltd. )2001-02 _________ (Himson Textile Engineering Industries Pvt Ltd. )

There are different type of machines are being used to manufacture a wide range of yarn processing machinery. There Product Range are from draw twisting machines to draw twisting machines, air texturising machines, two for one twister for filament yarn, Automatic shuttle changing looms, Rapier Looms and High speed circular knitting machines. Ancillary units manufacture precision spindle, high quality ceramic guides/components and heater for DTY/DT machines, PU discs, silk yarn processing machines and jute looms. Roughly 2.3% of total turnover stock is remain in the company every year.

[1998] TIE UP WITH M/s. TEINJIN SEIKI Co. LTD., JAPAN:-

In 1998, Himson has entered into a technical collaboration with M/s Seiki Textile Machinery Co. Ltd, Japan to manufacture high-speed draw texturising machines with energy conserving short heater and auto doffing.

Himson Textile Engineering Industries Pvt Ltd. enter into collaboration with M/s. Camber International of U.K. to manufacture high speed circular knitting machines and creating the market demands.

Himson Group- A Success Story

1937 to 1950Birth of group by weaving activities. Steady expansion to a larger area with increased loom age

1954Nylon filament weaving

1955 to 1