Jayshree Project Report

8/9/2019 Jayshree Project Report

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PROJECT REPORT

ON

EVALUATION OF CASH MANAGEMENT AT INDIAN OIL

CORPORATION ALONG WITH A FINANCIAL STATEMENT

ANALYSIS

Project Report su!"tte# to$%r#s p%rt"%& Fu&'"&&!e(t o'

M%ster o' )us"(ess A#!"("str%t"o(

*+,-.*+,/

SI00IM MANIPAL UNIVERSITY

DIRECTORATE OF DISTANCEEDUCATION

SUBMITTED TO:SUBMITTED BY:

MR1 AMIT 0UMAR GUPTA JAYSHREE ADWANI

2 FACULTY GUIDE3 M)A *

(#

Ye%r ROLL NO1 ,-+*+++,*4

SI00IM MANIPAL UNIVERSITY


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[ NIMACT, 36 Khandari, Agra]

L.C. Code- 01802

SIKKIM MANIPAL UNIVERSITY Page 2


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DECLARATION

I, J%5s6ree A#$%(", hereby de!are "ha" "hi# re#earh $ro%e" re$or" en"i"!ed&

7E8%&u%t"o( o' C%s6 M%(%9e!e(t %t I(#"%( O"& Corpor%t"o( %&o(9 $"t6 % '"(%(c"%&

st%te!e(t %(%&5s"s:

'i"h #$eia! re(erene "o I)CL ha# been $re$ared by *e on "he ba#i# o( re#earh and $er#ona! ob#er+a"ion

dring "he or#e o( *y "hird #e*e#"er o( MA $rogra**ed nder "he #$er+i#ion o( Mr1 A!"t 0u!%r

Gupt%; (a!"y o( i//i* Mani$a! ni+er#i"y.Thi# re#earh $ro%e" re$or" i# *y bene(iia! or/ and ha#

no" been #b*i""ed in any (or* "o any ni+er#i"y or in#"i""e (or "he aard o( any degree or di$!o*a $rior

"o "he nder *en"ioned da"e. I bear "he en"ire re#$on#ibi!i"y o( #b*i##ion o( "hi# $ro%e".

D%te


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SI00IM MANIPAL UNIVERSITY DIRECTORATE OF DISTANCEEDUCATION

Certifate

Thi# i# "o er"i(y "ha" ro%e" e$or" en"i"!ed

7E8%&u%t"o( o' C%s6 M%(%9e!e(t %t I(#"%( O"& Corpor%t"o( %&o(9 $"t6 % '"(%(c"%&

st%te!e(t %(%&5s"s:b*i""ed in $ar"ia! (!!(i!*en" o( "he re4ire*en"# (or "he degree o( Ma#"er o(

#ine## Ad*ini#"ra"ion o( i//i* Mani$a! ni+er#i"y o( 5ea!"h,Tehno!ogy,iene. =J%5s6ree A#$%(">

ha# or/ed nder *y #$er+i#ion o( nder gidane and no $ar" o( "hi# re$or" ha# been #b*i""ed (or "he

aard o( "he degree, di$!o*a, (e!!o#hi$ or o"her #i*i!ar "i"!ed $ro%e" and or/ ha# been $b!i#hed in any

%orna! o( *againe.

SIKKIM MANIPAL UNIVERSITY Page !


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ACKNO"LED#EMENT

7THE )EST WAY TO MA0E YOUR DREAMS COME TRUE IS TO WA0E UP

AND WOR0:

I" i# grea" $!ea#re (or *e "o a/no!edge a!! "ho#e ho ha+e on"rib"ed "oard# "he one$"ion, origin

and nr"ring o( "hi# $ro%e". 7ir#" I o!d !i/e "o "han/ *y (a!"y gide 7Mr1 A!"t 0u!%r Gupt%: ho

ha# he!$ed *e in *y $ro%e" re$or".

La#" b" no" !ea#" I o!d !i/e "o "han/# "o *y 7a*i!y, 7riend# e"9., "heir on#"an" enorage*en",

/ind ad+ie and #$$or" a# a gide "hrogho" or or/. Their e:"en#i+e /no!edge, n(ai!ing o$"i*i#*

and ea#y na"re ha+e *ade "hi# $ro%e" an e:i"ing and en%oyab!e e:$eriene hih i!! de(ini"e!y #ha$e

or ("re in a be""er *anner. I a* +ery ha$$y "o e:$re## *y dee$e#" gra"i"de "o e+erybody ho #$ared

"heir +a!ab!e "i*e and he!$ed *e a !o" in "he $re$ara"ion o( "hi# ro%e" re$or".

JAYSHREE ADWANI

ROLL NO1 ,-+*+++,*4

SIKKIM MANIPAL UNIVERSITY Page $


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Ta%&e '( ')te)t*

S No. Topics Page No.

1 Declaration 3

2 Certifcate From University 4

3 Acno!le"gement #

4 $%ec&tive S&mmary '

# (ntro"&ction )* Company or ()C+ Co. Analysis ,-23

)/0ectives 24

' esearc eto"ology 2#

, Financial Analysis 2-4

5 Detail eport- A. Cas anagement

6. $- Collection

C. +P7 Plant Analysis

41-#3

#4-#5

-5

1 Concl&sion '

11 S&ggestion '1

12 e*erence '2

13 Anne%&re '3-,

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E,e-ti.e S-//ar0

Tis pro0ect sees to eval&ate te Cas anagement at (n"ian )il Corporation along

!it a fnancial statement analysis in &n"erstan"ing te profta/ility8 li9&i"ity :

e;ciency o* te frm.

Te company &ses system calle" Cas anagement Pro"&ct DFC is also among te /aners to

(n"ian )il an" its c&stomers. To&g most o* ()C?s c&stomers cater to te services o*S6(8 tere are a *e! !o pre*er to carry o&t teir transactions *rom >DFC /an.

>ence (n"ian )il Corporation as appointe" >DFC as teir secon" /aner !ic also

elps tem "&ring contingencies.

(n"ian )il as aro&n" # locations aro&n" (n"ia !ic serve as an o&tlet *or te

fnise" pro"&cts. Payments are ma"e to tese locations on a "ay to "ay /asis. Tis

pro0ect provi"es an &n"erstan"ing to te *acilities provi"e" /y S6( to (n"ian )il at

vario&s locations.

D&ring te year 2'8 (n"ian )il starte" te concept o* $lectronic Collections


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INTRODUCTION OF INDIAN OILCORPORATION:

AS INDUSTRY ANALYSIS

Literat-re Re.ie::

BRIEF HISTORY OF OIL INDUSTRY IN

INDIA

(n 1,,18 Assam ail!ay : Tra"ing co. /egan

laying o* tracs in Assam.

Tey &se" elepants in place o* cranes.

)ne "ay8 one o* te elepants !an"ere" a!ay8

to come /ac !it its *eet smeare" /y slimy oil.

6actracing le" to te "iscovery o* oil in 6or/il8near present "ay Dig/oi.

A Cana"ian "riller8 illey +eove ollere" at

native /oys8 BDig /oy "ig.

)il !as str&c an" te name BDig/oi st&c.

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Begi))i)g '(

Petr'&e-/Ref)i)g i) I)ia Dig/oi /ecame te /irt place o*

(n"i?s oil in"&stry

(n 1,5s8 cr&"e oil "istillate" at argerita8 1 m a!ay *rom Dig/oi8 in castiron pans8 calle" BStills

Dig/oi efnery o* Assam )il Company


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C'/7a)ie* i) t8e i)-*tr0

At present8 tere are tree PSUs namely8 ()C8 >PC8 an" 6PC mareting oil

pro"&cts in co&ntry. (n a""ition8 some private players lie eliance8 $ssar an"

Sell ave also mareting rigts *or transportation *&els. Te company @ !ise

maret sare in sales ta/le /elo!

Retai& Mar9et

*8are

()C+

gro&p

4.2

6PC+ 1,.

>PC+ 1.#

)T>$S 2.2

Fig&res as on 1stNov 212

Total n&m/er o* retail o&tlets 253,

Mar9et *ie

(n"ia as total reserves o* ''# million metric tons


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efnery 6&ilt in eliance Petrole&m +t". (s in Jamnagar is te 6iggest oil

efnery in Asia.

Lega&; Reg-&at'r0 i**-e*

Te Political an" +egal environment *or te !ole oil in"&stry is very essential.

(n (n"ia te entire oil in"&stry is /een governe" /y )(+ inistry an" )(D6 a

7ovt. /o"y. Tese t!o instit&tes are responsi/le *or all te "ecision relate" to

te price8 K&antity Specifcation etc. 6esi"e tis te international politics also

aLect tis international commo"ity B)(+ a lot an" also its Companies. Any

Company )perate" in (n"ia a" to !or accor"ing to te norms an" on te

prices specife" earlier /y 7ovt. /o"ies.

O.era&& C'*t Leaer*8i7:

As per te 7overnment reg&lations8 all te players in "o!nstream petrole&m

sector ave to maintain same Prices8 in *act s&/si"iEe te mail commo"ities

lie otor Spirit8 >ig Spee" "iesel8 Herosene an" +P7. (n tis !ay ()C+ as

)verall Cost +ea"ersip vis-a-vis private Players.

Di


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eans? 6asis. For eac aca"emic year8 4# Scolarsip covering te frst year

st&"ents o* 1O(T(8 $ngineering8 66S an" 6A.

Te8)'&'g0

(n to"ay?s "ynamic /&siness environment8 innovation tro&g a s&staine"process o* researc an" "evelopment


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(n"ian )il?s MTA care $ /ran"e" *&ll service petrol stations is a res&lt o* a series

o* processe" in retail "esign8 pro"&ct an" service &p gra"ation 8 capa/ility

training8 a&tomation8 +oyalty Programs8 retail site management tecni9&es8 all

/enc mare" to glo/al Stan"ar"s. To"ay Mtra Care Petrol stations are

synonymo&s in (n"ia !it !orl" class Petrole&m retailing. ile te in"&stry

stan"ar" is to tae samples on 9&arterly /asis8 (n"ian )il as move" several steps

aea" /y intro"&cing *ortnigtly ran"om sampling !it specifc importance given

to )N ygienegrooming an" c&stomer

complaint re"ressers. Mtra Care Dealers also &n"ergo e%tensive training on etail

Sale 6&siness anagement?.

C'/7arati.e Va&-ati'): C'/7etit'r*

Sie a) S'7e '( B-*i)e**

()C+ as m&c opport&nity ion te present maret con"itions. Tis is /eca&se te

petrole&m pro"&cts are /ecome a nee" *or everyone an" still contains a lot o* scope

*or c&stomiEation. Te vario&s opport&nities are liste" /elo!

Since te company as te ma%im&m n&m/er o* o&tlets an" also te ma%im&mno. o* refneries in (n"ia8 it can very easily go *or e%tension at any point o* time8an" can intro"&ce any ne! pro"&cts8 !ic !ill get *rom its &ge maret

net!or. Te company can mae te /&ying process easier *or te c&stomers8 /y

implying many more scemes in te range o* MTAP)$ ANDMTA$ADS.

Te company can tin over te iss&e to /&il" its o!n pipelines8 so tat it !ill/e an in"epen"ent players an" it !ill also s&pport its aviation *&el s&pply.

Company as a great scope in $:P. (t is alrea"y involves in $:P /&t only in avery +imite" Scale.

I)-*tr0;7r'-t*;/ar9et A)a&0*i*

Pr'-t

1. SERVO



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it over 42Q maret sare an" 4# gra"es8 te S$I) range o* l&/ricants

is &se" in almost every application covering a&tomotive8 in"&strial an"

marine sectors.

2. INDANE LP# #AS

(n"ian oil (n"ane +P7 7as is &se" in 4 illion omes as cooing *&el an"

comman"s over 4,Q maret sare in (n"ia.

3. INDIAN OIL AVIATION SERVICE

(n"ian oil aviation service as a maret sare o* #Q !it a net!or o* 5#

Aviation F&el station meets complete Aviation *&el re9&irements o* te

De*ense Services.

4. AUTO #AS

(t as /een intro"&ce" in >y"era/a"8 6angalore an" &m/ai marets.

#. PREMIUM FULES

MtraPremi&m is te only petrol in (n"ia !it 51 )ctane.

Mtraile8 >ig Spee" Diesel !it !orl"-class a""itives as taen a

lea"ersip.

. =TRA PO"ER

(t *acilitates casless p&rcase o* *&el : l&/es *or "esignate" retail o* (n"ian

oil.

'. >*agat? @I#@"AY FLA#S@IP RETAIL OUTLET

Non-*&el oLers tro&g 6est-in-class? alliance on e%cl&sive /asis !erever

possi/le.

,. =TRA CARE

(t?s a series o* plans in retail "esign8 pro"&ct an" service &p gra"ation8

capa/ility training8 loyalty programme8 retail site management tecni9&e all

/encmar to glo/al stan"ar"s.

Prie

As per te 7overnment reg&lations8 all te players in "o!nstream petrole&m sector

ave to maintain same prices8 in *act S&/si"iEe te mail commo"ities lie otor

Spirit8 >ig Spee" "iesel8 Herosene an" +P7. For te s&/si"iEe" pro"&cts government

allots )il /on"s to PSU?s in or"er to partially compensate *or te &n"er-recoveries

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an" to some e%tent &pstream )il Companies


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3. Demograpic iss&e is also poising some treats to ()C+. ()C+?s nort

coast operations contin&e to s&Ler *rom certain constraints.

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(n"ian )il Corporate >istory

At te time o* in"epen"ence8 (n"ia?s oil in"&stry !as *&lly controlle" /yinternational oil cartel.

(n 15#8 (n"&strial Policy esol&tion !as passe"8 !ic lai" te *o&n"ation o*national oil in"&stry.

Te resol&tion state" @ B)il is o* vast importance in te !orl" to"ay. A co&ntrytat "oes not pro"&ce its o!n oil is in a !ea position. From te point o* vie! o*"e*ense8 te a/sence o* oil is a *atal !eaness.

$%ploration : pro"&ction !as p&t into Sce"&le @ BA8 meaning tere/y tatonly state !o&l" operate in tis fel".

Soon terea*ter8 )N7C !as *orme" *or oil e%ploration an" "rilling.

(n"ian )il efneries !ere *orme" in 15#, *or refning an" man&*act&ring o*petrole&m pro"&cts8 !it Sri FeroEe 7an"i as its Cairman.

Tis !as *ollo!e" /y te *ormation o* (n"ian )il Co. in 15#58 *or mareting an""istri/&tion o* petrole&m pro"&cts.

(n 158 (n"ian )il Co. signe" a istoric agreement !it soviet Union *or importo* 1.# T o* SH)8 >SD8 an" ATF over a perio" o* 4 years on Br&pee payment

/asis. Tis initiate" te en" o* to te monopoly o* *oreign oil companies.

)n 1st Septem/er 1548 as a step to!ar"s acieving improve" e;ciency8(n"ian efneries an" (n"ian )il Co. !ere merge". (n"ian )il Corporation +t".


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Indian Refineries Ltd.1958

Indian Oil Company Ltd.

1959

MER#ER

Indian Oil CorporationLtd.

1stSeptember 1964


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COMPANY OVERVIE"

(ND(AN )(+ C)P)AT()N +TD

()C


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(SS()N )F ()C+

()C+ as te *ollo!ing mission

To acieve international stan"ar"s o* e%cellence in all aspects o* energy an""iversife" /&siness !it *oc&s on c&stomer "eligt tro&g val&e o* pro"&ctsan" services an" cost re"&ction.

To ma%imiEe creation o* !ealt8 val&e an" satis*action *or te staeol"ers.

To attain lea"ersip in "eveloping8 a"opting an" assimilating state-o*- te-arttecnology *or competitive a"vantage.

To provi"e tecnology an" services tro&g s&staine" esearc an"Development.

To *oster a c&lt&re o* participation an" innovation *or employee gro!t an"contri/&tion.

To c&ltivate ig stan"ar"s o* /&siness etics an" Total K&ality anagement *ora strong corporate i"entity an" /ran" e9&ity.

To elp enric te 9&ality o* li*e o* te comm&nity an" preserve ecological/alance an" eritage tro&g a strong environment conscience.

IA+U$S )F ()C+Ial&es e%ist in all organiEations an" are an integral part o* any it. (n"ian )il n&rt&resa set o* core val&es

CA$

(NN)IAT()N

PASS()N

TUST



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)6J$CT(I$S )F (ND(AN )(+

()C+ as "efne" its o/0ectives *or s&ccee"ing in its mission. Tese o/0ectives are

To serve te national interests in oil an" relate" sectors in accor"ance an"consistent !it 7overnment policies.

To ens&re maintenance o* contin&o&s an" smoot s&pplies o* petrole&mpro"&cts /y !ay o* cr&"e oil refning8 transportation an" mareting activitiesan" to provi"e appropriate assistance to cons&mers to conserve an" &sepetrole&m pro"&cts e;ciently.

To enance te co&ntrys sel*-s&;ciency in cr&"e oil refning an" /&il"e%pertise in laying o* cr&"e oil an" petrole&m pro"&ct pipelines.

To *&rter enance mareting in*rastr&ct&re an" reseller net!or *or provi"ingass&re" service to c&stomers tro&go&t te co&ntry.

To create a strong researc : "evelopment /ase in refnery processes8 pro"&ct*orm&lations8 pipeline transportation an" alternative *&els !it a vie! tominimiEingeliminating imports an" to ave ne%t generation pro"&cts.

To optimiEe &tiliEation o* refning capacity an" ma%imiEe "istillate yiel" an"gross refning margin.

To ma%imiEe &tiliEation o* te e%isting *acilities *or improving e;ciency an"increasing pro"&ctivity.

To minimiEe *&el cons&mption an" y"rocar/on loss in refneries an" stoc lossin mareting operations to eLect energy conservation.

To earn a reasona/le rate o* ret&rn on investment.

To avail o* all via/le opport&nities8 /ot national an" glo/al8 arising o&t o* te7overnment o* (n"ia?s policy o* li/eraliEation an" re*orms.

To acieve iger gro!t tro&g mergers8 ac9&isitions8 integration an""iversifcation /y arnessing ne! /&siness opport&nities in oil e%ploration :pro"&ction8 petrocemicals8 nat&ral gas an" "o!nstream opport&nitiesoverseas.

To inc&lcate strong core val&es? among te employees an" contin&o&sly&p"ate sill sets *or *&ll e%ploitation o* te ne! /&siness opport&nities.



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To "evelop operational synergies !it s&/si"iaries an" 0oint vent&res an"contin&o&sly engage across te y"rocar/on val&e cain *or te /eneft o*society at large.

Ma'r Di.i*i')* '( IOCL:

(n"ian )il Corporation +imite"


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BUSINESS MODEL OF IOCL:

()C+ as its presence in all speres o* "o!nstream operations.

PRODUCTS OFFERED BY IOC

(n"ian )il is not only te largest commercial enterprise in te co&ntry it is teagsip corporate o* te (n"ian Nation. 6esi"es aving a "ominant maret sare8(n"ian )il is !i"ely recogniEe" as (n"ia?s "ominant energy /ran" an" c&stomersperceive (n"ian )il as a relia/le sym/ol *or ig 9&ality pro"&cts an" services. a0orPro"&cts o* ()C+ are


A&to +P7 +&/ricants : 7reasesAviation T&r/ine F&el arine F&els

6it&men S 7asoline>ig Spee" Diesel Petrocemicals

(n"&strial F&els Cr&"e )il

+i9&efe" Petrole&m 7as S&perior Herosene )il


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OR#ANIATIONAL STRUCTURE

Te !ole o* (n"ian )il Corporation


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OBECTIVES

To get an e%pos&re o* te act&al !oring environment !itin a m&lti-national.

To toro&gly &n"erstan" te cas o! management an" vario&s aspectsrelate" to /aning at (n"ian )il.

To st&"y an" analyEe all te "etails o* Cas anagement Pro"&ct


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RESEARC@ MET@ODOLO#Y

Te st&"y con"&cte" is investigative in nat&re tat is to say it pro/es into te cas :

/aning "epartment at (n"ian )il fg&ring o&t its ma0or *&nctions !it te elp o*

*e')ar0 *'-re*o* "ata availa/le *rom te "epartment itsel*.

T8e /a'r 7ara/eter* '( t8e /et8''&'g0 i)&-e:

Data Collection


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FINANCIAL ANALYSIS OF INDIAN OIL

CORPORATION LTD1



29/86

Fi)a)ia& *tate/e)t a)a&0*i* is "efne" as te process o* i"enti*ying fnancialstrengts an" !eanesses o* te frm /y properly esta/lising relationsip /et!eente items o* te /alance seet an" te proft an" loss acco&nt.

Tere are vario&s meto"s or tecni9&es tat are &se" in analyEing fnancialstatements8 s&c as comparative statements8 sce"&le o* canges in !oring capital8common siEe percentages8 *&n"s analysis8 tren" analysis8 an" ratios analysis.

Financial statements are prepare" to meet e%ternal reporting o/ligations an" also *or"ecision maing p&rposes. Tey play a "ominant role in setting te *rame!or o*managerial "ecisions. 6&t te in*ormation provi"e" in te fnancial statements is notan en" in itsel* as no meaning*&l concl&sions can /e "ra!n *rom tese statementsalone. >o!ever8 te in*ormation provi"e" in te fnancial statements is o* immense&se in maing "ecisions tro&g analysis an" interpretation o* fnancial statements.

Te tecni9&e o* fnancial statement analysis &se" /y me in tis pro0ect is ratioanalysis.

Rati' A)a&0*i*

Te ratios analysis is te most po!er*&l tool o* fnancial statement analysis.atiossimply mean one n&m/er e%presse" in terms o* anoter. A ratio is a statisticalyar"stic /y means o* !ic relationsip /et!een t!o or vario&s fg&res can /ecompare" or meas&re". atios can /e *o&n" o&t /y "ivi"ing one n&m/er /y anotern&m/er. atios so! o! one n&m/er is relate" to anoter.

Pr'fta%i&it0 Rati'*:

Profta/ility ratios meas&re te res&lts o* /&siness operations or overall per*ormancean" eLectiveness o* te frm. Some o* te most pop&lar profta/ility ratios are as&n"er

7ross proft ratio Net proft ratio

)perating ratio

$%pense ratio

et&rn on sareol"er?s investment or net !ort

et&rn on e9&ity capital

Divi"en" payo&t ratio

$arnings Per Sare atio

Price earning ratio



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LiG-iit0 Rati'*:

+i9&i"ity ratios meas&re te sort term solvency o* fnancial position o* a frm. Teseratios are calc&late" to comment &pon te sort term paying capacity o* a concern orte frms a/ility to meet its c&rrent o/ligations. Follo!ing are te most important

li9&i"ity ratios.

C&rrent ratio +i9&i" Aci" test K&ic ratio

Ati.it0 Rati'*:

Activity ratios are calc&late" to meas&re te e;ciency !it !ic te reso&rces o* afrm ave /een employe". Tese ratios are also calle" t&rnover ratios /eca&se tey

in"icate te spee" !it !ic assets are /eing t&rne" over into sales. Follo!ing arete most important activity ratios

(nventory Stoc t&rnover ratio De/tors eceiva/les t&rnover ratio

Average collection perio"

Cre"itors Paya/le t&rnover ratio

oring capital t&rnover ratio

Fi%e" assets t&rnover ratio

)ver an" &n"er tra"ing

L')g Ter/ S'&.e)0 'r Le.erage Rati'*:

+ong term solvency or leverage ratios convey a frms a/ility to meet te interestcosts an" payment sce"&les o* its long term o/ligations. Follo!ing are some o* temost important long term solvency or leverage ratios.

De/t-to-e9&ity ratio Proprietary or $9&ity ratio

atio o* f%e" assets to sareol"ers *&n"s

atio o* c&rrent assets to sareol"ers *&n"s

(nterest coverage ratio

Capital gearing ratio



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)ver an" &n"er capitaliEation

Li/itati')* '( Fi)a)ia& State/e)t A)a&0*i*:

Alto&g fnancial statement analysis is igly &se*&l tool8 it as t!o limitations.Tese t!o limitations involve te compara/ility o* fnancial "ata /et!een companiesan" te nee" to loo /eyon" ratios.

A.a)tage* '( Fi)a)ia& State/e)t A)a&0*i*:

Tere are vario&s a.a)tage*o* fnancial statements analysis. Te ma0or %e)eftistat te investors get eno&g i"ea to "eci"e a/o&t te investments o* teir *&n"s inte specifc company. Secon"ly8 reg&latory a&torities lie (nternational Acco&ntingStan"ar"s 6oar" can ens&re !eter te company is *ollo!ing acco&nting stan"ar"sor not. Tir"ly8 fnancial statements analysis can elp te government agencies toanalyEe te ta%ation "&e to te company. oreover8 company can analyEe its o!nper*ormance over te perio" o* time tro&g fnancial statements analysis.



32/86

PROFITABILITY RATIOS FOR T@E YEAR ENDIN# 35STMARC@

7ross Proft atio

(n"icates te relationsip /et!een net sales reven&e an" te cost o* goo"s sol"

7ross ProftNet Sales

R%t"o *+,* *+,, *+,+

IOCL3.;< 2.=1 ;.=6

)PCL0.>3 2.32 2.8>

HPCL 1.1> 1.1; 1.2

T8e gr'** 7r'ft /argi) 8a* (a&&e) /argi)a&&0 (r'/ &a*t 0ear -e t' t8e ri*ei) t8e '*t '( e,7e)it-re i)-rre

Net Proft atio

A meas&re o* net income &pees generate" /y eac &pee o* sales.

Net (ncome VNet Sales

V efnements to te net income fg&re can mae it more acc&rate tan tis ratiocomp&tation. Tey co&l" incl&"e removal o* e9&ity earnings *rom investments8 WoterincomeW an" Woter e%penseW items as !ell as minority sare o* earnings an"nonrec&rring items.

R%t"o *+,* *+,, *+,+

IOCL 1.02 2.22 3.=;



33/86

)PCL0.3> 1.01 1.26

HPCL

0.


34/86

R%t"o *+,* *+,, *+,+

IOCL12.83 10.32 1.03 >.8; 11.11

HPCL6.3= =.>3 >.20

T8e ROCE i* 8ig8er t8a) t8e rate '( %'rr'i)g* %0 t8e '/7a)0 *' t8i*'e* )'t 7'*e a)0 *eri'-* t8reat t' t8e *8are8'&er* ear)i)g*

LIUIDITY RATIOS FOR T@E YEAR ENDIN# 35STMARC@

C&rrent atioTe c&rrent ratio meas&res te a/ility o* te company to meet its sort termo/ligations i.e. to pay oL sort term "e/ts.

C&rrent AssetsC&rrent +ia/ilities

R%t"o *+,* *+,, *+,+

IOCL1.2< 0.80 0.=6

)PCL0.=; 0.=2 0.=2

HPCL0.=> 0.== 0.=;

T8e iea& -rre)t rati' ('r a)0 fr/ i* 2:5 I)ia) Oi& arrie* a %ig ri*9 '( )'t8a.i)g e)'-g8 a*8 re*er.e* ('r /eeti)g it* *8'rt ter/ '%&igati')*



35/86

Aci" Test ratio

A meas&rement o* te li9&i"ity position o* te /&siness. Te 9&ic ratio compares tecas pl&s cas e9&ivalents an" acco&nts receiva/le to te c&rrent lia/ilities. Teprimary "iLerence /et!een te c&rrent ratio an" te 9&ic ratio is te 9&ic ratio"oes not incl&"e inventory an" prepai" e%penses in te calc&lation. Conse9&ently8 a/&sinesss 9&ic ratio !ill /e lo!er tan its c&rrent ratio. (t is a stringent test o*li9&i"ity.

Cas O areta/le Sec&rities O Acco&nts eceiva/leC&rrent +ia/ilities

R%t"o *+,* *+,, *+,+

IOCL0.=1 0.


36/86

)6J$CT(I$S

eet *&n"s re9&irement on ti/e

F&e,i%i&it0in capital str&ct&re to leverage maret opport&nities

Provi"e e,it r'-te*

)ptimiEe '*t

(n"ian )il Corporation &ses innovatively "esigne" loan str&ct&re !ic !o&l" elptem manage teir !oring capital re9&irement in te most e;cient manner. Teloans are line" (6)8 pre-payment options8 interest resets8 C6+)8 Cross-c&rrencys!apping.

Feat-re* '( e%t /a)age/e)t at I)ia) Oi&:

Post "ereg&lation o* te oil sector *oreign c&rrency ris is to /e /orne /y ()C.

(nterest "iLerential /et!een Cas cre"it *acility an" oter !oring capital loansave increase" consi"era/ly.

$n"eavor to minimiEe &tiliEation o* CC limit !ile also avoi" s&rpl&s /alances.

a%imiEe &tiliEation o* F$ loans in vie! o* appreciating r&pee an" lo! interestrates.

Acc&rate cas o! pro0ections *or optim&m &tiliEation o* *&n"s.

6orro!ing limits approve" /y (n"ian )il?s 6oar" o* Directors

&pees. 3, crore Foreign C&rrency USG 4.# /illion

6( limit *or *oreign c&rrency /orro!ings @ Sort Term USD 2.5 /illion

Re*'-re /'%i&iati') '7ti')* a.ai&a%&e ('r I)ia) Oi&:

DOMESTIC OVERSEAS

S8'rt ter/

Cas cre"itover"ra*t

(6)8 T-6ill line"

loans

S8'rt ter/

6&yer?s cre"it

S&pplier?s cre"it

evolving lines o* cre"it

SIKKIM MANIPAL UNIVERSITY Page 3$


37/86

Access to C6+) maret

Commercial paper

Fi%e" loan *rom /ans

(nter corporate "eposits

$%port pacing cre"it

epo aving "ecrease" te rates gra"&ally8 Fe" maintaining stat&s-9&o o* late.

>ig ination : large capital maret o&to!s @ ca&sing te r&pee to "epreciateagainst USG

Te main o/0ective o* (n"ian )il?s "e/t management mo"&le is te minimiEation o*

te "e/t cost. For tis p&rpose te *ollo! certain strategies !ic elp tem

acieving tis target

+ong Term r&pee /orro!ings to /e a 0&"icio&s mi% o* f%e"8 oating : semi-

f%e". Tapping "omestic an" international maret *or maintaining optim&m proportion

o* F$ : r&pee loans as !ell as f%e"oating interest rates taing a"vantage o*

interest an" e%cange rate movements.



38/86

aising loans o* vario&s mat&rities to avoi" /&ncing &p o* loan repayments

"&ring any partic&lar perio". Availing F$ an" r&pee *acilities o* signifcant amo&nts !it p&t an" call option

on "aily /asis as per re9&irement. Development o* 6roa" : Diversife" so&rces o* F&n"ing - ecently tappe" US

maret *or raising f%e" rate &nsec&re" long-term *oreign c&rrency loan.

ACTIVITY RATIOS FOR T@E YEAR ENDIN# 35

ST

MARC@

(nventory T&rnover atio

Tis rate meas&res o! *ast te mercan"ise is moving. (n"ian oil re9&ires &ge

!oring capital re9&irement


39/86

De/tor?s t&rnover ratio or acco&nts receiva/le t&rnover ratio in"icates te velocity o*"e/t collection o* a frm. (n simple !or"s it in"icates te n&m/er o* times average"e/tors


40/86

()C+ as te lo!est f%e" asset t&rnover ratio !ic so!sine;ciency.

LON# TERM SOLVENCY OR LEVERA#E RATIOS FOR T@E YEARENDIN# 35STMARC@ 2652

De/t to $9&ity atio

(t is a meas&re o* a companys fnancial leverage calc&late" /y "ivi"ing its totallia/ilities /y stocol"ers e9&ity. (t in"icates !at proportion o* e9&ity an" "e/t te

company is &sing to fnance its assets.

Total +ia/ilitiesSareol"er?s $9&ity

R%t"o *+,* *+,, *+,+

IOCL1.2; 0.>< 0.88

)PCL 1.6> 1.3< 1.=0

HPCL2.8= 1.>> 1.8;

(nterest Coverage ratio



41/86

A ratio &se" to "etermine o! easily a company can pay interest on o&tstan"ing"e/t. Te interest coverage ratio is calc&late" /y "ivi"ing a companys earnings/e*ore interest an" ta%es


42/86

HPCL

26.>2 ;


43/86

INTEREST RATE RISK MANA#EMENT AT INDIAN OIL:

To optimiEe interest rate riss an" costs *ollo!ing parameters are applie" to

eac FC loan separately Floating rates minim&m 2#Q o* o&tstan"ing loans Fi%e" rates minim&m 2#Q o* o&tstan"ing loans 6alance amo&nt f%e"oating "epen"ing on vie!s

+ong term r&pee /orro!ings to /e a 0&"icio&s mi% o* f%e"8 oating : semi-f%e" Policy to /e constantly revie!e" /y (n"ian )il?s cons&ltants.

OT@ER RISK MANA#EMENT FUNCTIONS:

eely monitoring o* e%pos&res an" fnise" goo"s inventory levels

ontly report on ris management p&t &p to Director


44/86

T@E PROECT

CAS@ MANA#EMENT BANKIN# SYSTEM

Cas management at is itX

Cas anagement involves management o* te li9&i"ity o* te frm in or"er to

ma%imiEe cas availa/ility an" interest income on i"le *&n"s. At one en"8 te *&nction

starts !en te c&stomer !rites a cec to pay te acco&nts receiva/le an" en"s

!en te *&n"s are realiEe" te *&n"s on an acco&nt paya/le an" accr&al. )n te

oter an"8 te payment o* /ills involves acco&nts paya/le an" accr&almanagement.

$;cient cas management processes are pre-re9&isites to e%ec&te payments8 collect

receiva/les an" manage li9&i"ity. anaging te cannels o* collections8 payments

an" acco&nting in*ormation e;ciently /ecomes imperative !it gro!t in /&siness

transaction vol&mes. Tis incl&"es ena/ling greater connectivity to internal corporate

systems8 e%pan"ing te scope o* cas management services to incl&"e B*&ll-cycle

processes


45/86

To re"&ce internal a"ministrative cost

To control *oreign e%cange an" interest rate e%pos&re riss

@ISTORY OF CAS@ MANA#EMENT AT INDIAN OIL

An organiEations cas operating cycle is te complete process o* &tiliEing itsreso&rces an" converting tem into income tro&g tra"ing activities. Prior to te

esta/lisment o* te Cas anagement Pro"&ct mo"&le8 te (n"ian )il transactions

too place tro&g te conventional meto"s o* egional Cas Cre"it mo"&le. (n te

CC mo"&le te S6( /rances o* vario&s states "isperse" over vario&s locations

!o&l" sen" te in*ormation o* remittance o* *&n"s to te egional o;ce o* S6( an"

tey in t&rn !o&l" ten *or!ar" tat in*ormation to te S6( ea" o;ce.

>o!ever8 in tis mo"&le te lea"-time on an average !as 4-1 "ays "epen"ing on

te accessi/ility o* te location. Te "elay incl&"e" 2-' "ays *or te trans*er /et!een

te location an" State );ce S6( 6ranc to te egional );ce S6( 6ranc8 an"anoter 2-3 "ays *rom te egional );ce to te >ea" );ce S6( 6ranc. Tere*ore8

to&g a collection may /e ma"e on te 1 to* any mont te cre"it o* s&c a

collection may reect only on te 14t- 2to* tat mont.

(t is clearly evi"ent tat *rom s&c a long lea" time in te trans*er o* *&n"s8 te cas

re9&irements o* (n"ian )il an" te interest fg&re in te income statement are

aLecte" "irectly /y te lengt o* te cycle.

>ence to tacle tis pro/lem8 (n"ian )il?s primary /aner8 S6(8 intro"&ce" te CAS>

ANA7$$NT P)DUCT


46/86

te vario&s cre"it *acilities an" te oter /aning nee"s o* te corporation. CA7 o*

S6( operates !it net!or o* /rances calle" WCA7 6rancesW in all te etro Cities.

Te co-or"ination /et!een S6( an" ()C is "one *rom te >)-areting &m/ai.

Te Cre"it Facilities provi"e" /y S6( to (n"ian )il can /e s&mmariEe" as *ollo!s

FUND 6AS$D FAC(+(TY

(t is te amo&nt o* over"ra*t o/taine" *rom te 6an. At present te total over"ra*t

limit o* te corporation is controlle" tro&g te ain Cas Cre"it Facility. )ter

acco&nts opene" at vario&s /rances an" oter places are 0&st te e%tension o* tis

limit. (t gets rene!e" *rom time to time.

N)N FUND 6AS$D FAC(+(TYTese *acilities are *or p&re /aning convenience provi"e" /y te /an8 so tat te

Corporation can carry o&t te 6&siness transactions. Iario&s Non F&n"-6ase"

*acilities availa/le incl&"e

Per*ormance Financial 6an 7&arantee Facility

+etter o* Cre"it Facility - (nlan"

+etter o* Cre"it Facility - (mport

>) TANSACT()NS TAH$ $FF$CT

Un"ertaing te transactions at more tan # places an" giving eLect in a single

acco&nt o* &m/ai /ranc is a very complicate" process !ic involves a lot o*

s&pervision an" most importantly to a"minister te vario&s in" o* acco&nts ()C as

!it S6( to r&n its operations. $ac an" every acco&nt as its o!n a"vantages

to!ar"s company.

CAS> 6UD7$T P$PAAT()N AND ANA7$$NT

Compilation o* montly "ollarr&pee cas o! statements *rom inp&ts receive"

*rom all te "ivisions. Cas o! is monitore" on a "aily /asis

SIKKIM MANIPAL UNIVERSITY Page 4$


47/86

De/t availment repayment "eci"e" /ase" on cas o! pro0ections -

"ailymontlyyearly Iariance analysis o* act&al vs /&"gete" cas o! on an ongoing /asis.

CAS> F+) F)$CAST(N7 )I$I($

A ey

element o* treas&ry management involves pro0ections o* ino!s an" o&to!s o* cas

te corporation. (t also re9&ires its constant &p"ation on "ay to "ay /asis *or

ens&ring eLective *&n" management.

Pro0ection is "one in t!o stages

ontly --- /y 'to* every mont

olling --- /y 22n"o* every mont *or 1# "ays o* ne%t mont



48/86

For eLective *orecasting8 managers at (n"ian oil re9&ire cre"i/le in*ormation *rom

m&ltiple so&rces. Te so&rces o* in*ormation *or "aily &p"ation o* accr&als an"

refnement o* pro0ections can /e given as *ollo!s

Cas anagement Pro"&ct- Tro&g "o!nloa"ing "ata *rom CS Service

Provi"ers. e/-/aning emails *rom /ans.

egional Collection Centers - tro&g emails telepone *rom

All 4 regions o* mareting "ivision efnery "ivision Pipeline "ivision Assam oil "ivision

(n*ormation is receive" *rom net!ors sprea" all over (n"ia.

S6(

#' collection centers !it S6( in 2# locations most o* te centers ave CP


49/86

4 total !it"ra!al acco&nt !it S6( a/o&t 1# special !it"ra!al acco&nt

!it te *acility o* trans*erring te /alance at te en" o* te "ay to te

centraliEe" cas cre"it acco&nt !it S6(8 &m/ai.

>DFC


50/86

Heeping te a/ove consi"erations in min"8 S6(8 (n"ian oil?s primary /aner8

intro"&ce" a mo"&le no!n as CAS> ANA7$$NT P)DUCT or CP. CP is a

*acility provi"e" /y S6(8 !ere/y te collections an" !it"ra!als *rom te /rances

all over (n"ia are trans*erre" via electronic mo"e to te Cas Cre"it Acco&nt in

&m/ai.

Te CP *acility can /e "ivi"e" into t!o ain o"&les

Te Cre"it o"&le o* CP Tis o"&le "eals !it te Collection

Procee"s. Te De/it o"&le o* CP Tis o"&le "eals !it te it"ra!als.

Un"er CP8 no ne! acco&nt is opene". )n receipt o* te re9&est *or a ne! acco&nt

*or a partic&lar location8 te >) Finance gets a separate client co"e allotte" to te

location tro&g CP Cell &m/ai. S&c Client co"e is &ni9&e *or eac location.

Te CP Carges are "ivi"e" into 3 /roa" categories

.1 1 *or all te etros i.e. A Class City

.# 1 *or all te 6 Class Cities


51/86

C&rrent (mprest Acco&nt

+etter o* A&tority Facility

ail!ay Cre"it Note Facility

egional Cas Cre"it Acco&nt

Cas Cre"it Acco&nt

COLLECTION ACCOUNT) areting

Division.

Feat&res-

Trans*er o* *&n"s *rom all oter acco&nts lie te Collection Acco&nt8 SpecialC&rrent ) lie p&rcase o* *oreignc&rrencies8 repayment o* loan availe"8 an" etc. is "irectly "e/ite" to te CasCre"it acco&nt.

+oans availe" *or oring Capital p&rpose an" oter ma0or receipts an"le" /y>) are mostly cre"ite" to Cas Cre"it Acco&nt "irectly.

(nterest paya/le to te /an are /ase" on "aily WIal&e Date"W /alances in teCC Acco&nt an" is calc&late" every 9&arter /y applying te prevalent Prime-

+en"ing rate an" interest amo&nt is "e/ite" to Cas Cre"it Acco&nt.

Te /an /alance o* Cas Cre"it Acco&nt is monitore" on "aily /asis to ens&retat te over "ra*t /alances "o not e%cee" te sanctione" limit an" also nos&rpl&s /alances are ept i"le. Tis is "one !it te elp o* "aily Cas Flo!Forecast Statement tat is e%plaine" /elo!

For te p&rpose montly cas o! pro0ection statement is prepare" /y1't o* te previo&s mont *or te ne%t mont /y te >).

(n accor"ance !it te reso&rce gap t&s ascertaine"


57/86

SUMMARY

BANKIN# FUNCTIONS OF INDIAN OIL CORPORATION

LIMITED

UNDER CAS@ MANA#EMENT PRODUCT CMP

C'&&eti')*@ Cas cre"ite" "irectly in Cas Cre"it Acco&nt. "it8raa&*- Cas "e/ite" "irectly in Cas Cre"it Acco&nt.

SIKKIM MANIPAL UNIVERSITY Page !+

Collection

(85-90%

CM!

Witdra!als C"rrent Imprest

#cco"nt

$%re & '"nded(

Letter of#"tority

Rail!ayCredit)ote

Re*ional Cas Credit #cco"nt

$RCC(

$#LL 'O+R R,-IO)S(

Cas Credit #cco"nt $ead Office S/I C#- /ranc 0"mbai(


58/86

Letter '( A-t8'rit0- Cas "e/ite" "irectly in Cas Cre"it Acco&nt. Rai&a0 Creit N'te- Cas cre"ite" "irectly in Cas Cre"it Acco&nt.

ELECTRONIC COLLECTIONS

(nternet /aning or /aning via te (nternet can /e consi"ere" a remara/le

"evelopment in te /aning sector. Te a/ility to carry o&t /aning transactions

tro&g te (nternet as empo!ere" c&stomers to e%ec&te teir fnancial

transactions !itin te com*ort o* teir omes. 6esi"es tis8 te /enefts o* (nternet

/aning are not limite" to a partic&lar gro&p o* people8 as it /enefts /ot /aners

an" c&stomers alie.

Tans to te in*ormation tecnology an" te &pgra"es in o&r /aning sector an"

tans to eserve /an o* (n"ia


59/86

e ? Co&&ect"o( Mo#e&s

$ Collection &ses te internet /aning *acility /y a"apting to te latest tecnology in

&se. Some o* te important concepts coming &n"er it are

$lectronic F&n"s Trans*er


60/86

N$FT transactions are mostly avoi"e" at (n"ian )il. Tey ave teir pre*erence more

to!ar"s (nternet /aning an" eal Time 7ross Settlement.

Rea& Ti/e #r'** Sett&e/e)t RT#S

T7S is an instantaneo&s *&n"s-trans*er system8 !erein te money is trans*erre" on

a real time? /asis an" ence8 appens in a real time mo"e. it tis system yo& can

trans*er money to oter /an acco&nt !it ma%im&m 2 o&rs. (n tis system tere is

a limit tat yo& ave to trans*er money only a/ove s 1 la an" *or money /elo! s

1 +a transactions8 /ans are instr&cte" to oLer te N$FT *acility to teir c&stomers.

Tis is /eca&se T7S is mainly &se" *or ig val&e clearing. As o* no!8 c&stomers

can &se te T7S *acility only &p to 3.3 pm an" inter-/an transactions are possi/le

&p to # pm.

>ere !e o&tline te ma0or a"vantages tat T7S as over Core 6aning *acilities

DD ; Pa0 Orer ; Ot8er I)*tr-/e)t* RT#S

C&stomers arrange *or instr&ments in

a"vance(mme"iate Arrangement

6ans en0oy te oat till *&n"s are not

cleare"Float o* 2 @3 "ays pase" o&t

DecentraliEe" Control CentraliEe" Control

F&n"s cre"ite" in ()C Ac a*ter 2-3 "ays

s&/se9&ent to clearing /y /an

F&n"s cre"ite" on te same "ay

i* transaction "one !itin te

T7S time span

Cost to ()C+

(nstr&ment Collection

DC 7eneration : CecingDepositing at 6ranc

Follo! Up

No s&c cost

SIKKIM MANIPAL UNIVERSITY Page $6


61/86

Cances o* Disono&r

No Cances o* Disono&r as it?s a

Confrme" mo"e o* ealiEation o*

Collections

Te T7S sol&tion at (n"ian )il as /een implemente" /y its primary /aner i.e. S6(.Te main parameters /ein" coosing S6( as teir T7S ven"or are

A Primary : +ea" 6aner

>as long term 6&siness elation !it ()C+

Fle%i/le in te past to accommo"ate ()C+ re9&irements

ero "ay oat o* *&n"s

6esi"es c&stomer co"e "etail8 also provi"es pro"&ct "etails /y generating tem

in te (S an" ten *or posting it in SAP CP ann&al carges c&rrently inc&rre" sall /e re"&ce" once replace" /y T7S

aving nil cost (n arc , "&ring severe li9&i"ity crisis in maret T7S collections !ere

receive" in ()C Ac a*ter # @ o&rs *rom te time o* remittance. Also tere are

"elaye" settlements "&e to ig vol&me o* transactions at 6( en" on ne%t

!oring "ay o* any oli"ay @ all s&c instances !ill lea" to loss o* oat in case

6NP or >DFC are e%plore" T7S !it one /aner is recommen"e" as c&stomer so&l" not ave coice to

select /ans in !ic case tere may /e no control over collections

PROCEDURE OF RT#S COLLECTION AT INDIAN OIL

6eing a/le to transact !it ()C+ tro&g T7S system8 its c&stomers nee" to register

temselves !it S6( /y mapping in teir "etails. Tis 0&st a onetime process !ic

!ill ena/le ()C+?s c&stomers to get teir &sername an" (D create" an" involve in

electronic transactions !it (n"ian )il.

To s&mmariEe te role o* te &ser !e can say tat

A Username is create" *or maing payments in is o!n (D on "ay to "ay /asis. Access rigts as BAUT>)($ are assigne" to te User.

Te role is s&/mitte" to te /an /ranc *or approval an" *ollo! &p is "one.

B()C+-T7S is mappe" as Bs&pplier.

+iaison !it ()C+ state o;ce *or approval.



62/86

)nce te acco&nt is operational8 te &ser is a&toriEe" to mae payments to ()C+ in

te *ollo!ing *asion

C&stomer provi"es *ollo!ing "etails "&ring remittance at is /an /ranc.

C&stomer?s acco&nt n&m/er8 /enefciary /an8 /enefciary c&stomer name8

(FSC co"e o* receiving /ranc8 amo&nt an" ()C+ acco&nt n&m/er. ()C+ Ac No. @ An 1, "igit Co"e : Uni9&e *or eac C&stomer

First 11 "igits @ ()C+ S6( T7S Ac No.

12tDigit @ Alpa : Iaria/le ZA - Y [ "enotes CCA co"e


63/86

Ba)9 '(

I)ia

C're Ba)9i)g

65 J '( Tra)*ati')

A/'-)t

Ma, : R* 52!6

D-ri)g Ba)9 @'-r*

')&0

RT#S tra)*(eri) IOCL 51 igit

A; )' it8 BNP

Pari%a*

Ma, R* 2! 7er

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SIKKIM MANIPAL UNIVERSITY Page $!


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Steps I(8o&8e# I( Process

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CONCLUSION

1= Heep an eye on te lea"ing in"icators *or ()C+ an" /e a!are o* cangingeconomic con"itions. Prepare cas o! pro0ections *or te ne%t year. Tis !ill

elp ()Cto see !at canges nee" to /e ma"e an" !en. (* s&c-an"-s&cappene" an" ()C pre"icte" cas o! "roppe" %Q8 !at co&l" ()C"oX

2= anaging ()C?s c&stomers cre"it is an important part o* cas o! management.ee" o&t &nprofta/le c&stomers8 tose tat cost more to maintain tan teya"" to te /ottom line. Flag tose !o ave a istory o* slo! payment.emem/er tat yo& "o not ave to e%ten" cre"it to anyone. (* a c&stomer asa istory o* slo! payment8 canging te cre"it terms or even eliminating cre"itentirely may /e necessary.

3= First8 invoice promptly. P&tting oL invoicing gives te c&stomer te impression tatyo& "ont care o! long it taes to get yo&r money. Secon"8 tae meas&res toenco&rage prompt payment8 s&c as clearly stating payment "&e "ates an"sen"ing over"&e notices. Use (nvoices Tat $nco&rage Actiongives mores&ggestions. Use collection services !en necessary. 7etting te money i* yo&can is al!ays /etter *or yo&r cas o! tan a /a" "e/t.

4= )n te oter si"e o* te coin8 cec on te cre"it terms tat ()C?s small /&sinessss&ppliers allo!. ost s&ppliers allo! tirty "ays to pay /&t ()C may /e a/le toget tem to e%ten" tat term to si%ty or even ninety "ays8 allo!ing ()C to eepte money in cas o! pipeline longer.

T8e '-t' 7art '( a*8 ' i* )e.er a 7r'%&e/ /')e0 i&& a&a0* r-) '-t'( 0'-r %-*i)e** ea*i&0 Kee7i)g t8e /')e0 '/i)g i) ') a reg-&arH*-*tai)e %a*i* i* t8e tri90 7art '( a*8 ' /a)age/e)t

SIKKIM MANIPAL UNIVERSITY Page +!
http://sbinfocanada.about.com/cs/businessplans/a/bizplanfinanc_3.htmhttp://sbinfocanada.about.com/cs/management/qt/actioninvoices.htmhttp://sbinfocanada.about.com/cs/management/g/cashflowmgt.htmhttp://sbinfocanada.about.com/cs/businessplans/a/bizplanfinanc_3.htmhttp://sbinfocanada.about.com/cs/management/qt/actioninvoices.htmhttp://sbinfocanada.about.com/cs/management/g/cashflowmgt.htm


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SUGGESTIONS

7or Ca#h Manage*en"

(n"ian )il nee"s to mae s&re tat tey ave a clear vie! o* te tr&e cas position atany point o* time. Since tey "eal !it m&ltiple /ans8 it may get "i;c&lt to no! te

tr&e cas stan"ings. For tis p&rpose tey nee" to ave /etter internal controls so

tat te o! o* in*ormation among all te "epartments is smoot.

Tey nee" to ave /etter visi/ility o* te cas stan"ings so tat tey can eLectively"is/&rse teir s&rpl&ses an" "eal !it negative cas /alances. An o/vio&s place tostart is to s!eep any s&rpl&ses into "eposit acco&nts or investing in sort-termmoney marets. ere loans e%ist or acco&nts are over"ra!n8 cas can /e morepro"&ctively &se" to oLset tese8 t&s minimiEing interest payments.

Te oter areas in !ic cas as to /e e;ciently manage" incl&"e

$%plore centraliEing cas an" treas&ry management. evie! maret co&nterparties8 s&c as /ans8 on a reg&lar /asis.

Proactively plan to re"&ce "e/t levels.

$ns&re treas&ry an" cas management systems are &p to "ate.

Consi"er o&tso&rcing services to *ree &p time to /e spent on core treas&ryactivity.

Since ()C as large cross /or"er tra"e so tere so&l" /e parallel convergence in

international tra"e to!ar"s open acco&nt8 electronic payment an" te a&tomation o*

in*ormation o!s. (t so&l" a"opt te latest sol&tions to "igitiEe paper !erever it

persists. Tis !ill re"&ce te time o* te transaction an" !ill enance te sa*ety an"

a&tenticity.

7or e-Co!!e"ion

(ntegrate system so "etails o* c&stomers "irectly appear in SAP8 so mi""leman

can /e avoi"e". Still a n&m/er o* people &sing e-/aning is not signifcant8 so create a!areness

among c&stomers /y telling tem a"vantages o* system.

SIKKIM MANIPAL UNIVERSITY Page +$


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BIBLIO#RAP@Y

anagerial Finance - eston an" Copelan" Pg.

&ltinational Financial anagement @ Alan C Saripo Cas anagement @ .N. Josi

Financial anagement - Han an" Jain

Financial anagement - (.. Pan"ey

"EBLIO#RAP@Y

ttp!!!.iocl.coma/o&t&s.asp%

ttp!!!.iocl.compro"&cts.asp%

ttp!!!.iocl.comservices.asp%

!!!.moneycontrol.com

!!!.yaoofnance.com

ttp!!!.iocl.come"iaCenterNe!s.asp%XNe!s(D\2,2

(n"ian oil ne!s

!!!.pcl.com

!!!./pcl.com

http://www.iocl.com/MediaCenter/News.aspx?NewsID=2802http://www.hpcl.com/http://www.iocl.com/MediaCenter/News.aspx?NewsID=2802http://www.hpcl.com/


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ANN$MTU$

)ALANCE SHEET FOR THE YEAR ENDED -,ST MARCH

Parti-&ar* A/'-)t i)

Cr're

2652 2655 2656

EUITY AND LIABILITIES

S8are8'&er?* F-):

a S8are Ca7ita& 242+! 242+! 242+!

% Re*er.e a)

S-r7&-*

!+4!3! !!54+25 !663431

$63+336 !+54+2$ !24$233

S8are A77&iati') M')e0 Pe)i)g

A&&'t/e)t

66$

Mi)'rit0 I)tere*t 543+4 5363 5132+

N') C-rre)t Lia%i&itie*

a L')g Ter/ B'rr'i)g 5135646 5+342!3 53435+

% De(erre Ta, Lia%i&itie* !+626 +62112 !45+66

Ot8er L')g Ter/ Lia%i&itie* 4614 4544 36522

L')g Ter/ Pr'.i*i')* 366+3 223$3

2455+ 2!664+ !4114$

C-rre)t Lia%i&itie*

a S8'rt Ter/ %'rr'i)g* !$3644 3++6$!5

% Trae Pa0a%&e 322!351 23535 26$1

Ot8er C-rre)t Lia%i&itie* 211!24 2$2+22 544$!1!

S8'rt Ter/ Pr'.i*i')* 5!56264 $+35!$ 5646++5

532!51! 56662451 4!!+34!

T'ta& 2512+22 514$6551 5!4+!125

ASSETS

SIKKIM MANIPAL UNIVERSITY Page +


80/86

N') C-rre)t A**et*

a Fi,e A**et*

i Ta)gi%&e A**et* $3$66$ $5!12!! 44313

ii I)ta)gi%&e A**et* $612 564163 4+24

iii Di*/a)t&e Ca7ita&

A**et*

545 2+2! 45+1

i. Ca7ita& "'r9 i) Pr'gre** 5!5+231 56!4$!2 25313+

. I)ta)gi%&e A**et* -)er

De.e&'7/e)t

2++2$ 35$! 1246

16636!$ +3!2466 $124!51

% N') C-rre)t I).e*t/e)t* 31536 3$433 3436!

De(erre Ta, A**et* 6$4 6$2 656

L')g Ter/ L'a)* a)

A.a)e*

$6$$ !55+11

e Ot8er )') C-rre)t A**et* 2644 !14 514

312!3 1225+3 +5+!$12

#''i&& ') C')*'&iati') 243 234 2242

C-rre)t A**et*

a C-rre)t I).e*t/e)t* 53++413 5!663!3 5+3$+3

% I).e)t'rie* $31!564 !46$62 456+$!5

Trae Reei.a%&e* 55!!516 +$14$2 !$6$5!

Ca*8 a) Ba)9 Ba&a)e* 125! 5!3+13 5!143

e S8'rt ter/ L'a)* a)

A.a)e*

33$!!! 25$3233 5!2!321

( Ot8er C-rre)t A**et* 23512+ 5!2234 5!6+1+

52!++44 56221$$+ 12+1+

T'ta& 2512+22 514$651 5!4+!125

INCOME STATEMENT FOR THE YEAR ENDED -,ST MARCH



81/86

Parti-&ar*

A/'-)t i) Cr're

2652 2655 2656

I)'/e

Re.e)-e (r'/ O7erati')* #r'** 431623+$ 346$!++ 2!3+26

Le**: E,i*e D-t0 26+3 361$6! 2$6!662

Re.e)-e (r'/ O7erati')* Net 4612463 36++62 2333251

Ot8er I)'/e 351+53 344+$ 242!662

T'ta& Re.e)-e 4525555$ 353244+5 2!+!+26

E,7e)it-re

C'*t '( Materia& C')*-/e 26+$351 5!6645+5 545+!5!6

P-r8a*e '( St'9i)Trae 5!+2!615 52+$!3 566+26$5

C8a)ge i) I).e)t'r0 34+6! !$53++ !31$1$

E/7&'0ee Be)eft E,7e)*e* !3666 $+3424

Fi)a)ia& '*t !14$! 21!+6 5+2$5$

De7reiati') a) A/'rtiati') '):

Ta)gi%&e A**et* !5!$41 4+354 341566

I)ta)gi%&e A**et* 5!2+1 5341 +45$

!362$ 432$2 3!!!5$

Ot8er E,7e)*e* 22+$243 5$32!3$ ++1$

T'ta& E,7e)*e* 466$+12+ 3636!1! 24244444

Pr'ft %e('re Pri'r Peri'H

E,e7ti')a& Ite/* a) Ta,e*

55432$ 565141$ 5!534+$

I)'/e ; E,7e)*e* 7ertai)i)g t'

Pri'r Year* Net

2+62! +611 1$5$

Pr'ft %e('re E,e7ti')a& Ite/* a)

Ta,e*

55+6354 565531 5!641$6

E,e7ti')a& Ite/* ++6+12

Pr'ft %e('re Ta, 3!32 565531 5!641$6



82/86

Ta, E,7e)*e*:

C-rre)t Ta, +63$ 5+5!!$ 4$!2+

MAT Creit E)tit&e/e)t 563 52142 !26

Fri)ge Be)eft Ta, 553

De(erre Ta, 56!21 5$5522 !!26

Pr'ft; L'** ('r t8e 7eri' 42$!2+ 161!$2 561$1

Le**: S8are '( Mi)'rit0 32 2!46 21!4

Pr'ft; &'** '( t8e #r'-7 422!1 +136+2 56+535

Ear)i)g 7er EG-it0 S8are:

Ba*i 5+45 322! 4452

Di&-te 5+45 322! 4452

CASH FLOW STATEMENT FOR THE YEAR ENDED -,ST MARCH

P%rt"cu&%rs 2A!ou(t "( Crore3

*+,* *+,, *+,+

A1 C%s6 F&o$ Fro! Oper%t"(9 Act"8"t"es



83/86


84/86

In+e#"*en"#

In"ere#" F:$endi"re 01.61B 2>88.6< 1=26.31

8866.2> =;.31 ;316.6;

3. )$era"ing ro(i" be(ore

'or/ing Ca$i"a! Change#

1G2B

12861.61 16088.2> 1>363.80 20.=; 2>.>; 16.>; 1=38.>0



85/86

?i+idend ino*e on

In+e#"*en"#

=80.81.>6 636.>2

rha#e o( A##e"# 3;82.>8B 3103.6


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1

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Jayshree Project Report