A SYNOPSISA SYNOPSIS

ONON

WORKING CAPITAL MANAGE-MENT

IN RELATION TO

SUBMITTED IN THE PARTIAL FULFILLMENT FOR SUBMITTED IN THE PARTIAL FULFILLMENT FOR THETHE

AWARD OFAWARD OF DEGREE OF MASTER IN BUSINESSDEGREE OF MASTER IN BUSINESS

ADMINISTRATIONADMINISTRATION 2010-122010-12

SUBMITTED BY:SUBMITTED BY:

RROLLOLL N NOO.1021002331.1021002331

NNAMEAME: S: SAURABHAURABH S SACHDEVAACHDEVA

PPROJECTROJECT G GUIDEUIDE: D: DAYALUAYALU M MISRAISRA

INSTITUTE OF MANAGEMENT TECHNOLOGY

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TABLE OF C O N T E N T S

Title of the Project

Company Profile

Statement about the Problem

Objective and Scope of the Study

Methodology

Questionnaire

Chapterization Scheme

Project Guide

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TITLE OF THE PROJECT

Working Capital Management

NDPL

COMPANY PROFILE

North Delhi Power Limited (NDPL), the power distribution arm of Tata

Power, serves a populace of 50 lakh inhabiting northern and north-west-

ern parts of Delhi. It is a joint venture between Tata Power Company and

the Government of NCT of Delhi with the majority stake being held by

the Tata Group. The company started operations on July 1, 2002, post the

unbundling of the erstwhile Delhi Vidyut Board. With a registered con-

sumer base of around 9 lakh and a peak load of around 1100 MW, the

company's operations span 510 sq kms.

NDPL has been the frontrunner in implementing power distribution re-

forms in the capital city and is acknowledged for its consumer friendly

practices. Since privatization, the aggregate technical and commercial

(AT&C) losses in NDPL areas have shown a record decline. Although the

privatization agreement specified an AT&C loss reduction of 17 per cent

over a period of five years, NDPL has cut down its losses by over 19 per

cent in the first three years of operation.

NDPL's focus on technology has won it the Intelligent Enterprise Award

2004 and 2005 instituted by the Indian Express Group for exemplary use

of information technology in its operations.

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Areas of business-

The company has embarked on a plan to implement high-tech automated

systems for its entire distribution network. Systems such as SCADA, GIS

and OTS are the cornerstone of the NDPL's distribution automation

project. To fight the menace of power theft, the company has adopted

modern techniques like the high-voltage distribution system and LT Arial

bunch conductor.

NDPL is the first distribution utility in the country to provide on-line in-

formation on consumption, billing and payment to all its consumers.

World-class consumer care and cash collection centers have been set up

to ensure excellence in consumer care. The company has also introduced

new bill payment avenues such as drop boxes, 'Easy Bill' outlets and

round-the-clock electronic kiosks.

The company has set up the Centre for Power Efficiency in Distribution

(CENPEID), the first institute for skill accreditation and certification for

the power distribution sector in India. The Institute is slated be a national

resource and shall cater to the skill and management training needs of the

sector as a whole.

STATE ABOUT THE PROBLEM

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At NDPL a substantial part of the total assets are covered by current assets. Current

assets from around 80% of the total assets. However this could be less profitable on

the assumption that current assets generate lesser returns as compared to fixed assets.

But in today’s competition it becomes mandatory to keep large current assets in form

of inventories so as to ensure smooth production an excellent management of these in-

ventories has to be maintained to strike a balance between all the inventories required

for the production.

So, in order to manage all these inventories and determine the investments in each in-

ventories, the system call for an excellent management of current assets which is re-

ally a tough job as the amount of inventories required are large in number.

Here comes the need of working capital management or managing the investments in

current assets. Thus in big companies like NDPL it is not easy at all to implement a

good working capital management as it demands individual attention on its different

components.

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OBJECTIVES AND SCOPE OF STUDY

The objective of the project to achieve in-depth knowledge of

working capital management, the different aspects of working capital,the

understanding of different policies applied by bank for financing working

capital for different firms and at last finding the main components who

have higher weightage in financing current asset and current liability

which helps in proper management of working capital in NDPL.

This working capital cycle may be defined as the intervening pe-

riod from the time the goods and services enter the business till their real-

ization in cash. This intervening period depends upon the combination of

various steps.

Acquisition and storage of raw materials.

Actual production process that takes place.

Storage of finished goods awaiting sales.

Sale of finished goods and realization of cash.

Working capital needs of the company arise to cover the require-

ment of funds during this time gap, and the quantum of working capital

needs, varies as per the length of this time gap.

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METHODOLOGY

INTERNAL DATA

For the purpose of this study primary and secondary data has been used.

Primary data about working capital management was obtained through

Informal discussions with the managers and other officials of the organi-

zation.

Secondary data was collected through annual reports of the organization

for relevant periods. The data from these reports have been analyzed by

using various tools and techniques to evaluate the performance of the or-

ganization.

RATIO ANALYSIS

Ratio analysis is a widely used tool of financial analysis. It is defined as a

systematic use of ratio to interpret the financial statements so that the

strengths and weaknesses of a firm and its historic and current financial

condition can be determined.

COMPARATIVE STATEMENT

The statement of changes in financial position is a statement of flows i.e.

it measures the changes that have taken place in the financial position of a

firm between two balance dates. We have the cash flow statements to

measure changes in cash and working capital.

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APPENDIX

(in crores)PERIOD ENDING 31-Dec-11 31-Dec-10 31-Dec-09

Assets

Current Assets

Cash And Cash Equivalents2,064,000 910,000 1,651,000

Short Term Investments213,000 1,571,000 1,171,000

Net Receivables 4,683,000 4,389,000 3,725,000Inventory 2,522,000 2,290,000 1,926,000Other Current Assets 1,324,000 991,000 657,000

Total Current Assets 10,806,000 10,151,000 9,130,000

Long Term Investments 3,998,000 4,475,000 3,839,000Property Plant and Equipment 11,663,000 11,228,000 9,687,000Goodwill 5,124,000 5,169,000 4,594,000Intangible Assets 1,860,000 2,044,000 1,849,000Accumulated Amortization - - -Other Assets 2,324,000 1,356,000 599,000Deferred Long Term Asset Charges 219,000 205,000 232,000

Total Assets 35,994,000 34,628,000 29,930,000

Liabilities

Current Liabilities

Accounts Payable 6,494,000   6,209,000   5,271,000  

Short/Current Long Term Debt 369,000   -   274,000  

Other Current Liabilities 1,924,000   1,544,000   1,315,000  

Total Current Liabilities 8,787,000   7,753,000   6,860,000  

Long Term Debt 7,858,000   4,203,000   2,550,000  

Other Liabilities 7,017,000   4,792,000   4,624,000  

Deferred Long Term Liability Charges

226,000   646,000   528,000  

Minority Interest -   -   -  

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Negative Goodwill -   -   -  

Total Liabilities 23,888,000   17,394,000   14,483,000  

Stockholders' Equity

Misc Stocks Options Warrants -   -   (79,000)

Redeemable Preferred Stock (97,000) -   -  

Preferred Stock -   41,000   -  

Common Stock 30,000   30,000   30,000  

Retained Earnings 30,638,000   28,184,000   24,837,000  

Treasury Stock (14,122,000) (10,519,000) (7,758,000)

Capital Surplus 351,000   450,000   584,000  

Other Stockholder Equity (4,694,000) (952,000) (2,246,000)

Total Stockholder Equity 12,203,000   17,234,000   15,447,000  

Net Tangible Assets 5,219,000   10,021,000   9,004,000  

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INCOME STATEMENT

(in crores)

PERIOD ENDING 31-Dec-11 31-Dec-10 31-Dec-09Total Revenue 13,796,000 13,591,000 12,730,000Cost of Revenue 7,586,000 7,370,000 6,810,000

Gross Profit 6,210,000 6,221,000 5,920,000

Operating ExpensesResearch Development - - -Selling General and Administrative 5,149,000 5,150,000 4,903,000Non Recurring 412,000 - -Others - - -

Total Operating Expenses - - -

Operating Income or Loss 649,000 1,071,000 1,017,000

Income from Continuing OperationsTotal Other Income/Expenses Net (25,000) 6,000 (11,000)Earnings Before Interest And Taxes 564,000 983,000 947,000Interest Expense 290,000 274,000 266,000Income Before Tax 274,000 709,000 681,000Income Tax Expense 112,000 177,000 159,000Minority Interest (60,000) (94,000) (59,000)Net Income From Continuing Ops 162,000 532,000 522,000

Non-recurring EventsDiscontinued Operations - - -Extraordinary Items - - -Effect Of Accounting Changes - - -Other Items - - -

Net Income 162,000 532,000 522,000Preferred Stock And Other Adjustments - - -

Net Income Applicable To Common Shares 162,000 532,000 522,000

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PROFITABILITY STATEMENT

PROFITABILITY ANALYSIS (in

crores)

Year 2009 2010 2011Particulars

Net Sales 12730 13591 13,796

Cost of Goods Sold 6900 7370 758Operating Profit Before Interest 5830 6221 6210Operating Profit After Interest 5830 1071 649Profit/Loss Before Tax 681 709 274Profit/Loss After Tax 522 532 162Dividend Payout/Drawing 0.41 0.53 0.65

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CHAPTERIZATION SCHEME

DETAILS PAGE NO.

1. Company Profile

2. Theoretical Background

3. Working Capital Evaluation

4. Performance Analysis

5. Conclusion

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BIBLIOGRAPHY

1. WWW.NDPL.COM

2. WWW.GOOGLE.COM

3. COMPANY’S INTERNAL SOFTWARES LIKE SAP, BIRD.

4. MANUALS, MAGAZINES PRINTED BY NDPL.

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PROJECT GUIDE

CURRICULUM VITAE

DAYALU MISRA Neelkanth Apartments, Flat No. – BF3,Near Durga Ashram, Chhattarpur New Delhi-100074Email: dayalu.misra@gmail.comMobile: 9873514133

CAREER OBJECTIVE:

Seeking a job which gives me a platform to use and apply my analytical skills, my ability to identify and follow financial trends leading to the development of the company and also my professional growth.

SUMMARY OF SKILLS AND EXPERIENCES

Over 10 years of experience in Finance & Accounting including – Closing & Report-

ing, Analysis of numbers, Reconciliations, Vouching, Cash Book Maintenance, PF &

ESI related jobs.

Presently working with Genpact India as an Assistant Manager.

Completed on-site transition of Intercompany Accounts from Montreal, Canada.

Having a good knowledge of Oracle11i, MS-Excel, MS-Word, Outlook, Internet and

Tally.

Effective communicator with excellence in MIS.

ORGANIZATIONAL EXPERIENCE

Genpact India, Gurgaon April, 2006 – PresentPosition: Assistant ManagerJOB PROFILE

o Performing Closing & Reporting and Analysis of Numbers.o Managing Working Capitalo Transition of Inter Company account from GE Capital - Canada (Montreal).

Reconciled the account which was un-reconciled for more than 5 years. o Reviewing Reconciliation for Cash, Intercompany, Receivables and Payables

for GE Capital Businesses.o Research and Root Cause Analysis of Open Items.o Regular communication with GE customer to clear open items.o Preparation and posting of correctional Journal entries.o Manage other MIS work.

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Orthonova Hospital, New Delhi Oct, 2003 – Mar, 2006

Position: Accounts Exec.JOB PROFILE

o Preparation of all Bank and Debtors reconciliations and general ledger en-tries.

o Preparation of all kind of vouchers.o Preparation of TDS calculation, TDS certificate and filing of TDS return.o Preparation of payroll accounts.o Preparation of P&L and Balance Sheet.

Sumit Suri & Associates (Chartered Accountants), New Delhi Aug, 2000– Sep, 2003

Position: Accounts AssistantJOB PROFILE

o Preparation of vouchers, data punch from cash, bank and journal voucher.o Preparation of Bank reconciliation.o Preparation of Debtors reconciliation.o Prepared TDS calculation and return for various clients.o Preparation of P&L and Balance Sheet.

PROFESSIONAL EXPERTISE:o Continued improvement conceptso Team spirito Sharing best practices with other teamo Troubleshooting and problem solving skillso Ability to adjust in different industries, Cultures and environments

EDUCATIONAL QUALIFICATION:

o MBA Finance from Institute of Management Technology, Ghaziabad in 2010.o Bachelor in Commerce from University of North Bengal with second division

in 1998.

SYSTEM KNOWLEDGE:

o Oracle11i, Business Object, MS Excel, Word, PowerPoint, Internet & TallyPERSONAL DETAIL:

Father’s Name : Late Sh Asharfi Misra

Contact No. : 91 - 9873514133 (Mobile)

Date of Birth : December 23rd, 1976

Valid Passport No. : F6381383

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DAYALU MISRA

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