Summer Training Project

[SLM MGT 01 301 C 0202]

“A Study on working capital management at

Britannia Industry”

Undertaken at
Britannia Industry Ltd
Submitted in the partial fulfilment of their requirements for the award of

Degree of

Master of Business Administration (MBA)

TO

Department of Management Studies

Central University of Haryana, Jant-Pali-123029

Mahendergarh

Session: 2022-2024

Supervised by: Submitted by

Saikumar Goad Akkiligunta Praveen

(HR of Britannia Industry) Roll no: 220405

 DECLARATION

I hereby declare that this project work entitled “A Study on working capital management at
Britannia Industry PVT. LTD”, is my work, carried out under the guidance of my faculty guide,
Dr. Ashish Mathur. This report neither full nor in part has ever been submitted for award of any
other degree of either this university or any other university.

Place: Mahendergarh Supervisor Signature

Date:20/02/2024 Dr. Ashish Mathur

Professor department of management studies

CERTIFICATE
 ACKNOWLEDGEMENT

Glory be to God, the Almighty, the Forgiving. We could not have completed this report without
your approval and support. Without the inspiration and advice of a certain someone, this report
might not have been able to be completed successfully and on time. Firstly, I would like to express
my gratitude to Mr. Kuldeep Singh, who served as my guide during my internship at Britania
Industries. This report could not have been completed without his assistance.
Lastly, I would like to sincerely thank everyone who helped in the report's preparation.

______________________
(Signature of the student)
Name: Akkiligunta Praveen
 TABLE OF CONTENTS

Content Name Page No.

No.

Chapter 1 Introduction of the Company 2

1.1 Introduction to FMSC sector and industry overview 3

1.2 Company Overview 8

Chapter 2 22
Review of Literature

Chapter 3 Research Methodology 34

Chapter 4 Data Analysis and Interpretation 36

4.1 Current Ratio 40

4.2 Quick Ratio 41
4.3 Asset- Turnover Ratio 43
4.4 Fixed Asset Turnover Ratio 44
4.5 Dept- Equity Ratio 46
4.6 Return on Equity Ratio 48
4.7 Gross- Profit Margin 50
4.8 Net Profit Ratio 51
4.9 Profit Earning Ratio 54
4.10 Inventory Turnover Ratio 55

56
Chapter 5 Major Finding

5.1 Discussion and Suggestion 57

5.2 Conclusion 58
5.3 Limitations of the Study 58

59
Chapter 6 Bibliography
 LIST OF TABLES

Table No. Title Page No.

4.1 Current Ratio 40
4.2 Quick Ratio 41
4.3 Asset- Turnover Ratio 43
4.4 Fixed Asset Turnover Ratio 44
4.5 Dept- Equity Ratio 46
4.6 Return on Equity Ratio 48
4.7 Gross- Profit Margin 50
4.8 Net Profit Ratio 51
4.9 Profit Earning Ratio 54
4.10 Inventory Turnover Ratio 55
 LIST OF FIGURES

Figure No. Title Page No.

1.1 Common FMGC Product 04
- Concept of working capital 27
- Working Capital cycle 31
1 New Good day cashew 12
3 50-50 Sweet and salty 13
6 Pav 13
9 Cheese Slices 14
11 Cheese cubes 14
14 Dahi 15
16 Cake 15
18 Toasts 16
4.1 Current Ratio 40
4.2 Quick Ratio 41
4.3 Asset- Turnover Ratio 43
4.4 Fixed Asset Turnover Ratio 44
4.5 Dept- Equity Ratio 46
4.6 Return on Equity Ratio 48
4.7 Gross- Profit Margin 50
4.8 Net Profit Ratio 51
4.9 Profit Earning Ratio 52
4.10 Profit Earning Ratio 54
4.11 Inventory Turnover Ratio 55
 Executive Summary

Since its establishment in 1892, Britannia Industries Limited has been a mainstay in the
Indian food sector. It is known for its high-quality and flavour biscuit production. In the
Fast-Moving Consumer Goods (FMCG) industry, Britannia is a major participant with
both domestic and international operations. With a market capitalization of over
US$13.1 billion, the FMCG industry in India has enormous growth potential. It is
distinguished by strong rivalry, well-established distribution networks, and a
combination of organized and unorganized markets. Britannia is unique in the industry
since it maintains a substantial market share and profitability in spite of past
management scandals.

India's FMCG industry is attractive because of its large population, robust distribution
system, and low operating costs. The industry is positioned for exponential expansion,
with the market predicted to quadruple from $11.6 billion in 2003 to $33.4 billion in
2015. Along with Hindustan Unilever, ITC, Nestle, AMUL, and other top FMCG firms
in India, Britannia is a member of this group. India's enormous domestic market—
which is home to more than a billion people—further enhances the country's appeal to
FMCG players.

With an annual revenue of more than INR 9,000 crores, Britannia Industries Limited
has a well-rounded product portfolio that includes cakes, cookies, dairy goods, bread,
and healthy snacks. The company's focus on delicious, fresh, and healthful food is in
line with changing consumer tastes. Apart from its stronghold in the Indian market,
Britannia has extended its reach to more than 60 nations throughout the globe.

Britannia's strengths are highlighted via a SWOT analysis, which includes a robust
distribution network, a large brand portfolio, and market leadership in the baking
industry. Nonetheless, there are issues such an excessive reliance on the biscuit industry,
same products, and a small global footprint. Britannia has opportunities to strengthen
its dairy industry, satisfy the growing consumer demand for healthier goods, penetrate
international markets, and investigate e-commerce.

1
 CHAPTER 1
INTRODUCTION OF THE COMPANY

2
1.1 INTRODUCTION

INTRODUCTION TO FMGC SECTOR & INDUSTORY OVERVIEW

Part of the Wadia Group, which is headed by Nusli Wadia, is the Indian food industry specialist
Britannia Industries Limited. based in Kolkata and established in 1892. Known for its biscuit products,
this company is among the oldest in India still in operation. The company sells breads, biscuits, and
dairy goods under the Britannia and Tiger brands both domestically and abroad. Since being acquired
by the Wadia Group in the early 1990s, the business has been involved in a number of management-
related scandals. Still, it is profitable and holds a sizable portion of the market.

With a total market value of more than US$13.1 billion, India's fast-moving consumer goods (FMCG)
industry ranks fourth in the country's economy. Strong international presence, firmly established
distribution networks, fierce rivalry between organized and unorganized market groups, and cheap
operational expenses are its defining characteristics. India has a competitive advantage thanks to the
availability of essential raw commodities, lower labor costs, and presence throughout the value chain.
The market for FMCG is anticipated to quadruple from

$33.4 billion in 2015 compared with $11.6 billion in 2003. Market share and per-person usage in the
majority of product categories, such as hair shampoo, toothpaste, jams, and skincare. It demonstrates
the unrealized potential of the market. India's expanding middle class and rural populations present
chances for branded goods makers to win over customers to their brands. In developed product
categories, consumer "upgrades" may also be the main driver of growth. He projects that 200 million
people will migrate to packaged and processed foods by 2010, therefore India will need to invest about
US$28 billion in the food processing sector.

COMMON FMGC PRODUCTS

Food and dairy products, glassware, paper goods, consumer electronics, pharmaceuticals, packaged
foods, plastics, printing and stationery, home goods, photos, beverages, and so on are some typical
FMGC product categories. Products include things like batteries, tea, coffee, gifts, cards, cigarettes,
detergents, watches, soaps, and so on.

3
MARKET POTENTIALITY OF FMGC INDUSTRY:
Potential Market for FMGC Industry: The FMGC industry has many benefits that have
brought it together, including lower operating costs, a robust distribution network, the existence
of respectable FMGC businesses, and population expansion, among other variables that affect
the industry's performance.

Leading FMGC companies:

1. Hindustan Unilever ltd. (HUL)
2. Indian Tobacco Company (ITC)
3. Nestle India
4. AMUL
5. Dabur India
6. Asian Paints (India)
7. Cadbury India
8. Britannia Industry
9. Procter & Gamble Hygiene and Healthcare
10. Mariko Industries

4
WHY INDIA?
Large domestic market:
India is one of the biggest emerging markets, home to more than one billion people. With a
robust middle class including 300 million individuals, India boasts one of the most robust
economies globally in terms of purchasing power. Urban and Rural Opportunities profiles of
the rural and urban areas.

Source:
NCAER, India Statistical Brief Around 188 million Indian homes, or 70% of all households,
reside in rural areas. It is anticipated that there would be 153 million rural households overall
in 2009–10, up from 135 million in 2001–02. The local FMCG market is estimated to have
been worth US$10.5 billion in 2001–2002, making it the greatest potential market in the world.
The market potential is expected to continue expanding as incomes are increasing at both rural
and urban levels.

Demand – supply gap

Although the proportion of India's raw resources that are now processed into value-added goods
is tiny, the country's desire for ready-to-eat foods is rising. This supply gap presents untapped
opportunities in areas such as packaged forms, prepared meals and beverages, and dairy
products. Low market penetration in the personal care category in both urban and rural areas
points to the sector's potential.

5
India – A large consumer goods spender
The average Indian spends 8% of their salary on personal care items and 40% of their income
on groceries. India's vast population base and high percentage of fast-moving consumer goods
(FMCG) in total personal spending make it one of the world's largest FMCG marketplaces.

THE BROAD AREA OF WORKING CAPITAL MANAGEMENT:

Working capital management requires the three E's of economy, efficiency, and effectiveness,
all of which are discussed when discussing management. It falls into two major categories: 1)
Profitability and liquidity; 2) Funding and investment choices.

Scope of Working Capital Management

Liquidity and Profitability
Investment and Financing

LIQUIDITY AND PROFITABILITY:

Maintaining even liquidity of funds is important for the smooth and uninterrupted operation of
a company’s day-to-day operations. As you know, 1 rupee capital comes with a cost. Therefore,
the cost aspect must be kept in mind when maintaining liquidity. Superfluous money invested
in non-productive assets decreases both liquidity and the potential to benefit from higher
returns on productive assets. Therefore, in order to boost profitability without interfering with
day-to-day operations, trade-offs between liquidity and profitability are required.

INVESTMENT AND FINANCING

• Working capital policy is a function of two decisions: to fund the project after first
making a working capital investment. Working capital investment is correlated with
working capital investment level. The question of "how much" must be invested in order to
accomplish the organization's objectives (i.e., resource efficacy) is answered. financial
choices pertaining to the allocation of money for working capital. "Where does the money
come from at the lowest possible cost (i.e., economy)?" is the response. Working capital
investment: The amount of money allocated to working capital is determined by business
policy. Organizational objectives, business practices, and financial (cost-effectiveness)
factors should all be taken into account. The amount of money that should be invested in
working capital is not predetermined. Because of their unique characteristics, some
organizations demand greater investment than others. For instance, a company that
6
 develops infrastructure could need to invest more working capital due to its big inventory
of unfinished work, whereas a fast-food chain might need less. As a result, the amount
invested relies on a number of variables, as listed below:
• Nature of Industry: Due to their lengthy gestation periods, businesses like breweries and
construction enterprises need to invest a lot of working capital.

• Types of products: Comparatively speaking, consumer durables have a larger inventory

than perishable goods.

• Manufacturing Vs Trading Vs Service: A manufacturing business needs to keep three

stocks on hand. H. Trading firms, service providers, finished items, work-in-progress, and
raw materials only require inventory to be kept as goods or consumables, respectively.

• Volume of sales: High sales can also indicate a potential for high receivables.

• Credit policy: In addition to having a high level of receivables, an organization with a

liberal credit policy needs additional money to finance the acquisition of raw materials.

APPROACHES OF WORKING CAPITAL INVESTMENT

Three methodologies are used to classify working capital investment decisions based on the
organizational strategy and the risk-return trade-off.

Aggressive:
Here, investment in working capital minimizes investment in working capital. This means
companies holding less inventory, following strict credit policies, keeping less cash on hand,
and more. The advantage of this approach is working capital, resulting in lower financial costs,
but the organization cannot grow, underutilization of assets, and potential long-term debt. To
fall behind competitors in the long term.

7
Conservative:

This organizational approach results in significant amounts of capital being invested in liquid assets.
Organizations keep inventories high, pursue liberal credit policies, and maintain sufficient cash
balances to meet all current liabilities immediately. The benefits of this approach are increased sales
volume, increased demand due to liberal credit policies, and increased supplier credit due to short-term
payments. The disadvantages are higher capital costs, increased risk of bad debt, long-term liquidity
bottlenecks, and longer operating cycles.

Moderate:

This method falls between the first two methods mentioned above. This strategy maintains a risk-return
balance while making extremely efficient use of the funds to increase gains.

1.2 COMPANY OVERVIEW:

One of India's top food firms, Britannia Industries has been around for a century and generates over
9,000 Cr in revenue annually. Britannia, one of the most reputable food brands, produces some of the
most well-known brands in India, including Milk Bikis, Marie Gold, Tiger, Good Day, and Nutri
Choice. Britannia's product line consists of dairy goods such cheese, drinks, milk, and yogurt in
addition to biscuits, breads, cakes, and rusks. Indians have grown up with Britannia for many
generations, and our brands are well-known and adored both domestically and internationally.
Britannia products are accessible in about 5 million retail locations across the country, reaching more
than 50% of Indian households.

Britannia's dairy directly reaches 100,000 locations of sale, accounting for approximately 5%
of the company's sales. Britannia Bread, valued at Rs 4.5 crore and with an annual revenue
over 1 lactone, is the largest brand in the organized bread market. In its more than 100 Indian
cities and villages, the company sells close to one million loaves of bread every day through
its 13 facilities and four franchise outlets.

We have operations in more than 60 nations worldwide. Our global reach includes a foothold
in the Middle East, where we have local manufacturing operations in Oman and the United

8
Arab Emirates. The company is vying for supremacy in the UAE, where it is the second-largest
biscuit provider, and it also enjoys significant market positions in the other GCC nations. In
Nepal, where we also dominate the market, we are investing in production facilities.

Our footprint is expanding exports to North America, Europe, Africa and Southeast Asia and
we have invested in a state-of-the-art facility located in Mundra SEZ, Gujarat to serve the
export market.

Our "New Market Year" philosophy serves as the foundation for our strategic expansion plan.

All of our portfolios have a central focus on delicious, fresh, and healthful food.

Reputable companies including Mill Ward Brown, IMRB, WPP Group, and Havas Media
Group have performed surveys and found that the Britannia brand is among the most
appreciated, trusted, and well-liked brands.

We have won important honors like the Ramakrishna Bajaj National excellence Award and the
Golden Peacock National Quality Award for our unwavering dedication to freshness and
excellence.

But our customers' prizes are the ones that matter most to us. Numerous credible surveys have
identified Britannia as one of the most reputable, valuable, and desired brands among Indian
customers.

Britannia considers "Taste & Trust" to be its moniker and is still working to get 444.4 billion
Indians to go for his tasty and nutritious Britannia products several times a day. Boost.

Imagine Britannia:

COMPANY PROFILE:
West Bengal is home to Britannia Industries Limited's registered office. The Companies Act of
1956 governs the registration of this business. On March 21, 1918, the Britannia Biscuits
Company Limited was established in accordance with Section 21 of the Companies Act of

9
India and with authorization from the Central Government. The company was renamed The
Britannia Biscuits Company Limited.

The company's primary objective is to supply biscuits of superior quality across the country.
The company now holds ISO22000 accreditation and is working toward ISO14001
certification. The company was established on May 21, 2005 at his Pant Nagar facility with a
primarily manufacturing area of approximately 20 acres. Management is controlled by a board
of directors.

Our principal registered office and place of business is at his address below.

Britannia Industries Limited33, Industrial Area Lawrence Road,

Delhi- 110035
Britannia Industries Limited
Plot No.1, Sector-1 Integrated Industrial Estate Pant Nagar, Rudrapur- 263153

(d) Britannia Industries Limited MTH Road,

Padi Chennai – 600050

(e) Britannia Industries Limited Ready Road (East), Mazagaon, Mumbai- 400010

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11
OUR PRODUCTS

1. THE ALL-NEW GOOD DAY:

A smile is what makes a good day! The small joys that make life shine are often overlooked by
seeking greater joys. The slogan is "Har cookie mein kayi smiles". Greetings of the day encourage
us to savor each and every small moment of life!

Britannia Good Day is an all-new and tastier avatar that brings the smile philosophy to life through
new logos, packaging and biscuits. blow in. New Good Day cookies also have a smiley face design!

NEW GOOD DAY CASHEW

1. BRITANNIA GOOD DAY CASHEW BISCUIT

With a nutty surface and great new Flavors, the new Hello Cashew gives consumers even more
reasons to love their favourite cookie!

2. 5050 SWEET & SALTY:

At Britannia we believe everyone has a crazy side. And we celebrate it with the 5050, Maska
Chaska, Time Pass & Top brands. With products that can certainly be called differentiated, these
brands have held a special place in the hearts of consumers across the country in the world of sweet
biscuits

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3. 5050 SWEET & SALTY

4. BRITANNIA 50-50 SWEET SALTY BISCUIT

What happens when you mix two completely opposite Flavors? You get smack and the iconic
Britannia 5050 Sweet & Salty biscuits - sweet and Savory. His two Flavors of his 5050, launched
in 1993, quickly became famous, but his quirky and memorable advertisements, including the iconic
and popular "Na rename 5050" advertising campaign, fuelled its growing popularity among young
people.

5. BREADS:
It's best to do it correctly whether your goal is to live or to eat. Britannia's selection of delectable
and nutritious breads has everything your body could possibly require. is prepared to provide you
with a filling and delectable breakfast.

6. PAV

7. BRITANNIA PAV
When you toast these superb soft Pavs in butter, your supper will be enhanced magically. Savor it
Mumbai-style with bhaji, vada, or simply plain bun Maska; these Pavs will return the favor.

13
 8. CHEESE:
All you need for pizzas, pastas, cakes, and hamburgers is a recipe and some cheese. With the widest
variety of cheeses available in India, including slices, cubes, blocks, spreads, low-fat cheeses, and
cream cheeses, Britannia Cheese is a proud supplier of cheeses.

9. CHEESE SLICES

10. BRITANNIA CHEESE SLICES

A nutritious slice comparable to a glass of milk. Individually wrapped to preserve taste, nutritional
value and freshness.

11. CHEESE CUBES

12. BRITANNIA CHEESE CUBES

Small, convenient flavoured nuggets you can't wait to chew. For this reason, each cube is carefully
wrapped in tear able duct tape.

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13. YOGHURT:
Each spoon is thicker, tastier and healthier.
Britannia Dairy Dahi lives up to its name with no preservatives, colors or fragrances.

14. DAHI

15. BRITANNIA DAHI

Available in various sizes of 80g, 150g and 400g. There is also a low-fat version

16. CAKES:

A cake with a fluffy texture that makes the most of the deliciousness of dairy products and eggs.
Choose from his six exciting flavors: Fruit, Chocolate, Orange, Milk, Butter and Pineapple.

15
17. BRITANNIA FRUIT BAR CAKE
It is topped with small pieces of fruit to whet your taste buds.

18. TOSTS:
Crunchy and packed with wheat goodness, Teatime at Britannia to As Tea is a healthy pleasure.
Take a piece, dip it into hot tea, observe how much of the tea it absorbs, and have that crunchy,
crunchy tea moment!

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 19. BRITANNIA PREMIUM BAKE
Savor the flavor and feel of traditional Britannia Premium Baked Rusks. These tea blends are the ideal
accompaniment to a hot cup of tea since they have the ideal balance of sweetness, wheat flavor, and
Erich notes.

• PRODUCT SCOPE

Biscuits: Britannia is well-known for its wide variety of biscuits, including popular brands like Good
Day, Marie Gold, Tiger, 50-50, and more.

Dairy Products: Britannia has ventured into the dairy segment, offering products such as cheese,
butter, ghee, and dairy-based beverages.

Bakery Products: The company also produces cakes, bread, and rusk, expanding its presence in the
bakery segment.

Nutritional Products: Britannia has introduced Nutri Choice, a range of health-oriented products
that include biscuits and other snacks with a focus on well-being.

Snacks: Britannia offers various snack items, including cookies, cakes, and savory snacks.

SWOT ANALYSIS

Britannia is India’s most popular food brand, covering most of India. Conduct an in-depth his SWOT
analysis of Britannia to understand how the company is performing. So, let’s explore Britannia’s
strengths.

• STRENGTHS OF BRITANNIA

A company’s ability to gain more market share, attract more customers, and maximize profits is
called its strength. Britannia’s strengths are:

17
Brand portfolio:

Britannia stands as a unique entity in India, providing bakery products tailored to cater to a wide
spectrum of income groups. This inclusive approach enables the company to tap into a broader
consumer base. Remarkably, Britannia holds a substantial share, accounting for up to 30%, in the
Indian biscuit production market.

Excessive brand recall:

Since they handle a wide range of products such as biscuits, dairy products, cakes, and rusks, they are
highly visible in stores. Also, with aggressive marketing and advertising, this has led to the creation of
a brand.

Since they handle a wide range of products such as biscuits, dairy products, cakes, and rusks, they are
highly visible in stores. Also, with aggressive marketing and advertising, this has led to the creation of
a brand.

Benefiting Indian markets for the last 120 years:

One of India’s most esteemed brands, Intrepid Bakers, originated 123 years ago in Kolkata. The
dedicated bakers crafted a delightful array of golden cookies with a special purpose in mind. These
biscuits were meticulously prepared to cater to the discerning palate of a high-ranking British officer
who had a penchant for traditional British teatime treats. Over the decades, the company has been
supplying biscuits, dairy products and more nutritious foods to various households in India.

Today, it is one of India’s leading companies with 3.5 million retail outlets.

Penetration into the market and distribution:

The company boasts an extensive market network with a diverse range of Stock Keeping Units (SKUs),
facilitating their availability through a robust distribution system. This expansive reach empowers
Britannia to extend its presence to nearly every corner of the world.

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Market leader in the bakery sector:

BIL stands out as a prominent player in the Indian food industry, specifically dominating the bakery
sector with a substantial 30% market share. We produce delicious and healthy biscuits, breads, cakes,
rusks and dairy products.

• WEAKNESSES OF BRITANNIA:

No company will ever be perfect in all areas. Certain flaws necessitate additional work. British faults
principally are:

Overdependence on biscuit business:

Britannia derives a significant portion of its sales, approximately 75%, from its biscuit business. While
they enjoy a substantial presence in the cookie market, this heavy reliance on a single sector could
potentially pose long-term challenges for the company.

Indistinguishable products:

For instance, Britannia, Pearl, and other local brands all produce bourbon biscuits, which confuses
consumers and costs businesses money because so many other businesses produce goods that are
comparable to Britannia's. Boost.

No overseas presence:

Britannia only exists in Oman and Dubai, and India also comes from a subsidiary, so overall exports
of goods are very small.

• Opportunities for Britannia:

Opportunities represent areas where a company can concentrate its efforts to enhance revenue and
profitability.

19
Dairy business struggles:

Dairy products contribute only 5% of the company’s total sales.

Upcoming Dairy products:

Gaining market share and establishing the company in the dairy market will be made possible by
improving dairy products with new sensory features.

Demanding healthier products and changing lifestyle:

Rising incomes, internet access, education, and lifestyle changes are increasing the demand for healthy
foods.

Enter into foreign markets:

Penetrating and expanding into foreign markets helps a company gain global recognition.

E-commerce:

The eCommerce industry has witnessed a surge in sales, with a growing number of consumers opting
to make online purchases. Britannia could explore the potential for revenue generation by establishing
its own online stores and conducting business through this digital platform.

• Threats for Britannia:

There are external threats that can hinder business growth. Some of the Britannia threats are listed
below.

Increasing competition:

There are external threats that can hinder business growth. Some of the Britannia threats are listed
below.

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Increasing Price of the raw materials:

If the price of raw materials increases, the price of the product will eventually increase. In addition,

This leads to lower profit margins and reduced consumption.

Buyer’s power increasing

Customers are finding it more and more difficult to remain with a single brand because there are so
many brands available that all purport to offer distinct benefits to consumers. As a result, consumers
are able to swap brands according to their preferences, price, and other factors.

Buyer’s power increasing:

Customers are finding it more and more difficult to remain with a single brand because there are so
many brands available that all purport to offer distinct benefits to consumers. As a result, consumers
are able to swap brands according to their preferences, price, and other factors.

Britannia is widely recognized and present around the world. Her SWOT analysis of Britannia showed
that the company has a great brand awareness and is a trustworthy entity. The primary issue, though,
is that we must strengthen our R&D department in light of the growing market competitiveness.
A corporation needs to do its best marketing operations in front of its clients in order to succeed in the
market. As times change, one of the most crucial concepts for all market aficionados is digital
marketing. Digital marketing tools, like SEO and SMM, allow businesses to reach a wider audience at
a lower cost.

21
 CHAPTER 2
REVIEW OF LITERATURE

22
Filbeck Greg and Krueger Thomas M. (2005) expand on a working capital management
evaluation that was printed in CFO. The findings of this research provide light on how working
capital management and performance are influenced by macroeconomic variables such as
interest rates, competition, and working capital availability. The effect of working capital
management on stock prices is further examined in this article.

Messel Wieslaw and Polewski Marcin (2006) Examine the working capital formation and
management practices of a few chosen construction enterprises through their profiles. Financial
data serves as the basis for analysis. The authors conclude by saying that the creation of control
techniques is necessary for complex working capital management. Working capital
management is a task beyond the purview of finance because of the specifics of the construction
industry, such as operational considerations and market requirements. It entails coordinating
investment procedures, organizing production processes, and addressing logistical challenges.

Thapa Sankar (2007) emphasizes the value of Sun Pharmaceutical Company's effective
working capital management. In order to improve working capital businesses, he looks at the
working capital idea, working capital policy, working capital components, and the variables
that have affected Sun Pharma Industries Ltd.'s working capital during the previous five years
in this article. We have determined the precise elements that went into the article's conclusion,
which forewarns businesses that failure to maintain a sufficient amount of working capital will
result in bankruptcy.

Dinesh M. (2008) explains working capital as a concept, the different working capital
management difficulties that businesses confront, and the sensible management solutions that
these enterprises must implement. The writers come to the conclusion that a lack of funding,
not profit, is the main reason why most businesses fail. Companies may utilize all available
financial resources to attain growth and generate assets like inventories, accounts receivable,
and other noncurrent assets as a result of rapid increases in production and sales.

Working capital management efficiency (WCME) and earnings before interest (EBIT) of
the Indian paper industry from 1997-98 to 2005-06. Throughout the period, all companies
employed his three index values—the Performance Index, Utilization Index, Efficiency Index,
and EBIT—to gauge how well their working capital management was performing. As the
survey comes to a finish, we discover that Indian paper companies have done incredibly well
23
over this time. In three of the nine years under investigation, the industry-wide efficiency index
was higher than 1. The difference indicates that these businesses are doing high-quality work.
Policy on capital management (WCM). fervently advocating that this be done

Bhunia Amalendu (2010) demonstrates how important the Indian pharmaceutical industry is
to maintaining and advancing the growth of the essential pharmaceutical sector. A company's
manufacturing and productivity performance, profitability, liquidity, working capital, fixed
asset, cash flow, and social performance are all frequently evaluated through financial analysis.
Good financial performance of cash positions for specific medications for KAPL and RDPL is
observed in the study's conclusion. He contends that in recent years, the long-term solvency of
KAPL and RDPL has reduced the degree of protection that these companies provide to creditors
by making them more reliant on outside funding for long-term credit.
Doing. Decreasing. RDPL’s debt turnover ratio needs to improve as the company’s solvency
depends on sales income generated from the utilization of various assets Singh Swaran and
DR. Bansal S.

Rahman Mohammad M. (2011) emphasizes the connection between profitability and

working capital. A company's profitability is positively impacted by efficient working capital
management. The analysis demonstrates that the textile sector satisfies the necessary standards
for working capital management and profitability.

Haq Ikram Ul, Sohail Muhammad, Zaman Khalid, and Alam Zaheer (2011) investigated
the connection between profitability and working capital management using information from
14 Khyber Pakhtunkhwa (KPK) cement sector enterprises. (2004–09). The main objective of
this study was to find out whether financial indicators influence the performance of companies
in specific situations of the cement industry in Pakistan. Correlation analysis, coefficient
analysis, and multiple regression analysis techniques were used to analyze the data. From this
result, we can infer that there is a moderate relationship between working capital management
and company profitability.

Dr. Abab Ahmed and Dr. Matarneh Bashar (2011) Think of the registration technique as a
very helpful statistical working capital prediction tool. After establishing the historical average
relationship between turnover and working capital and its many components, forecasting is

24
helpful in the field of working capital management. Formulas or graphical representations can
be used for analysis.

Ramadu Janaki P. And Parasuraman NR. (2012) In the Indian pharmaceutical industry,
place more emphasis on sales and growth than on working capital fluctuations and profitability.
According to the report, rise in profits was out of proportion to earnings and elements of
working capital like accounts receivable and inventory. According to the study's conclusion,
there is no proof that sales growth and other variables like net working capital, inventory turns,
and customer sales are related. Moreover, it can be said that neither the profitability of the
company nor the impact of the debtor's sales on it is required for sales growth to correspond
with growth in profitability and inventory turnover.

Matarneh, Bashar (2012) discusses the significance of small industries to the Indian economy.
In this essay, the issue of managing working capital for small-scale industries (SSI) in
Rajasthan is examined during a five-year period. Small industries, as we all know, have to make
decisions about where to put their working capital. According to research, figuring out working
capital funding patterns is one of the main issues with working capital management. The issue
of managing working capital in small-scale industries is not new and is widespread in India.

THERIOTICAL PERSPECTIVE

WHAT IS WORKING CAPITAL?

Investments made by a business in short-term assets like cash and securities are referred to as
working capital. Working capital fewer current obligations is referred to as net working capital
or network capital. This implies that Net Working Capital is equal to Working Capital minus
Current Debt.

• Major Current Assets

• Cash
• Accounts Receivables
• Inventory
• Marketable Securities

25
 • Major Current Liabilities
• Bank overdraft
• Unpaid expenses
• Liabilities

Working capital, possibly compelled to file for bankruptcy if insolvent. Working capital needs
to be sufficient to fund working capital in order to keep a safety buffer. A major theme of
working capital management theory is the interaction of current assets and short-term
liabilities.

Working capital definition:

Working capital (WC) can be easily defined as part of the total capital required for day-to-day
operations. It’s the capital to handle the business. This states that working capital is the total
amount of money needed to pay for a company's running expenses. In other words, the funds
the company needs to carry out its day-to-day operations. Example: purchase of raw materials
or finished goods. Working capital is also defined as “the excess of current assets over current
liabilities” (Sources M.O. Patkar, Management Accounting)

The most important definitions of working capital are:

The discrepancy between cash input and outflow is known as working capital. The net inflow
of funds is that.
All current assets added together equals working capital. Put another way, because working
capital is essentially rotating, it is often referred to as total working capital, working capital, or
working capital.
The difference between current assets and current liabilities and reserves is known as working
capital. Put differently, net working capital is what it is called.

26
CONCEPT OF WORKING CAPITAL:
There are two major concepts of working capital:

Gross working capital:

This is the amount that a business has invested in current assets. Do assets that can be converted
into cash throughout the fiscal year qualify as liquid assets? The total working capital shows
that funding must be set aside for working capital.

Net working capital:

It speaks of the differential between current liabilities and current assets. There might be a
positive or negative net working capital. When current assets are more than current liabilities,
net working capital is positive; the opposite is true for negative net working capital. Net
working capital is a qualitative term. It is an indication of a company’s liquidity position and
the extent to which it can meet its working capital requirements through permanent funding
sources. Net working capital also includes the issue of a reasonable mix of long-term and short-
term funding to raise working capital.

27
IMPORTANCE OF WORKING CAPITAL
You may think of working capital as the company's lifeblood. Without sufficient operating
capital, no corporate organization can function effectively or profitably. Working capital in
company is comparable to blood in the human body. Because working capital studies have a
direct bearing on the day-to-day operations of the organization, they are crucial for both internal
and external examination. One of the main reasons why businesses fail is poor or inadequate
working capital management. For businesses to be able to pay for recurring expenses like
purchasing raw materials, services, etc., they need working capital. Remember that working
capital is just a portion of a company's overall capital structure.

In summary, credit and cash are like blood to a business since they support an organization's
ability to survive and grow, or to become solvent. Financial management must always maintain
correct cash balances and ensure that the flow of funds is maintained at a desired rate without
slowing down. This allows the company to balance liquidity and profitability. Working capital
management is therefore essential to any activity. The main benefits of maintaining adequate
working capital are:

Solvency of business:
Adequate working capital helps maintain a company’s solvency by ensuring an uninterrupted
flow of production.

Goodwill:
Sufficient working capital allows a business to build and preserve goodwill as well as make
payments on schedule.

Easy loan:
Businesses that possess adequate working capital, strong solvency, and favorable credit ratings
can obtain loans on favorable conditions from banks and other sources with ease.

Cash credit:
Adequate working capital also allows companies to take advantage of purchase discounts to
reduce costs.

28
Regular supply of raw material:

Continuous manufacturing and a steady supply of raw materials are guaranteed by adequate
working capital.

Regular payments of day-to-day commitments:

Regular payment of salary, wages, and other ongoing obligations through working capital can
boost employee morale, boost productivity, cut expenses and waste, and raise profitability.

Exploitation of favourable market conditions:

Only businesses with ample working capital can benefit from favorable market conditions by
retaining their assets at a greater rate and purchasing necessities in bulk while prices are low.

Ability to face crisis:

Businesses may handle situations like recessions if they have enough working capital. This is
because working capital is generally under severe pressure during such times.

Quick and regular return on investment:

All investors want quick and regular investment returns. Adequate working capital enables
companies to pay dividends to investors quickly and regularly. because there could not be much
of a profitable market for future fundraising.

High morale:
A business with adequate operating capital operates more efficiently overall because it fosters
a culture of stability, trust, and good morale.

PLANNING OF WORKING CAPITAL:

Daily business operations demand working capital. The criteria for working capital (WC) vary
throughout companies. The company’s goal is to maximize shareholder wealth and generate
sufficient profits from its operations.

WCM is an important aspect of financial management. Their importance arises for two reasons:

29
Investments in working capital total A significant portion of investments. Investments in liquid
assets and the amount of short-term liabilities must respond quickly to sales trends.

This project requires funds for two purposes:

acquisition of fixed assets to increase manufacturing capacity. financing the liquid assets
needed to run a business.

The fact that financial managers devote a large portion of their time to managing current assets
and current liabilities illustrates the significance of WCM. Your ability to turn a profit is based
on the volume of sales. To turn a profit, sales are necessary. Sales aren't instantly translated into
cash, though. The process of selling something and getting paid in cash is never quick.
Maintaining a correct balance between WC management and a company's profitability and
liquidity is crucial, as they are inversely proportional. The issues emerging from the quick
realization of cash for the goods sold must be resolved by WC in the form of liquid assets in
order to transform the sale of goods into cash. Sustaining sales activity requires a sufficient
number of restrooms. This is referred to as the money cycle or operational cycle.

30
WORKING CAPITAL CYCLE:

A business needs a number of years to recover its original fixed asset investment. On the other
hand, working capital investments are made repeatedly throughout the year. These liquid asset
investments are realized during the course of the business's operational cycle.

Time and money are the two dimensions that each working capital component—that is,
inventory, receivables, and payables—has. Time is money when it comes to managing working
capital. Businesses can increase revenue or decrease the amount they need to borrow for
financing if they can move money through the cycle more quickly (e.g., collect debts from
debtors faster), or if they can lower the amount tied up (e.g., reduce inventory relative to sales).
Working capital. As a result, you can lower the interest rates your bank charges or have more
spare cash to fund investments or further sales growth. Similarly, if you are able to bargain with
your supplier for better terms. B. Extend your credit limit or obtain longer credit. essentially
establish free money to support upcoming purchases. You could want to pay with cash if you
own property. It takes many years for a company to recoup its initial investment in fixed assets.

31
In contrast, investments in working capital are repeated many times a year. Such investments
in liquid assets are realized during the company’s operating cycle.

Time and money are the two dimensions that each working capital component—that is,
inventory, receivables, and payables—has. Time is money when it comes to managing working
capital. Businesses can increase revenue or decrease the amount they need to borrow for
financing if they can move money through the cycle more quickly (e.g., collect debts from
debtors faster), or if they can lower the amount tied up (e.g., reduce inventory relative to sales).
Working capital. As a result, you can lower the interest rates your bank charges or have more
spare cash to fund investments or further sales growth. Similarly, if you are able to bargain with
your supplier for better terms. B. Extend your credit limit or obtain longer credit. essentially
establish free money to support upcoming purchases.
You might choose to make your payment in cash if you own property.

OPERATING CYCLE CONCEPT:

Working capital is necessary for any business to exist since without it, fixed assets would stop
working. Since working capital is used internally by the company, liquid assets are distinct
from the other two. Cash is used to pay for operating costs, buy inventory and raw materials,
and convert into work-in-progress and finished goods. When finished goods are sold on credit,
an amount known as accounts receivable is produced. After it is received, the claim is converted
into cash. The need for working capital arises from the temporal mismatch between the time of
commodity creation and the actual realization after sale. This time frame is technically referred
to as the "working capital cycle" or the "operating cycle." In theory, a profitable company ought
to produce additional liquidity. If the company doesn't make a surplus, it will eventually run
out of money and shut.

The operating cycle consists of three phases:

• Acquiring resources like labor, fuel, energy, and raw materials.
• Product manufacturing, which includes transforming raw materials from work-in-progress
to final goods.
• Selling products on credit or for cash. Accounts receivable are generated for collection by
credit sales.

32
• The bigger the company, the more money it needs for working capital and investments.
Proper working capital management generates cash that helps improve profits and reduce
risk.

Working capital management is important for several reasons:

• To purchase raw materials, consumables and spare parts.

• Pay wages and salaries.
• To cover ongoing costs and overheads such as fuel, electricity and office expenses.
• Inventory management of raw materials, work in process, inventory and spare parts,
finished goods.
• Sales costs such as packaging and advertising

33
 CHAPTER 3
RESEARCH METHODOLOGY

34
Objective of study

• Know the factors that affect the working capital of Britannia Industries Ltd. Impact.
• Analyse Britannia Industries’ working capital cycle
• Make recommendations and suggestions to the company to further improve operations.

TYPES OF RESEARCH DESCRITPTIVEVS ANALYTICAL

The main purpose of descriptive research is to describe the current situation. The social
sciences and business studies often use the term post-mortem study for descriptive studies. B.
Shopping frequency, people’s preferences, or similar data.

Research design
An organized diagram that explains an issue is called a research design. That is the initial phase
of all study. This research plan will serve as the foundation for this investigation. It
demonstrates the next steps in the process and how research findings are taken into account for
classifications, interpretations, and suggestions. This serves as a standard for all work.

SAMPLING METHOD
In exploratory research, convenience sampling is employed when researchers seek low-cost
approximations of the truth. As the name suggests, the samples were chosen with an emphasis
on practicality. This non-probabilistic method is often used in preliminary research to obtain a
rough estimate of the outcome without the expense and time of random sample selection.

SCOPE OF THE STUDY:

• This study provides management with an idea of the company’s working capital
performance.
• The management of current assets, current liabilities, and the connections between them is
referred to as working capital management.
• A sound working capital policy ensures a company’s high profitability and sufficient
liquidity.

35
 CHAPTER 4

DATA INTERPRETATION

36
 Ratio 2018 2019 2020 2021 2022

Current Ratio 2.02 1.94 1.44 1.20 0.93

Quick ratio 1.59 1.48 1.16 0.90 0.60

Asset Turnover 2.23 2.03 1.70 1.68 1.85

Ratio

Fixed asset 7.55 7.52 7.32 8.16 6.99

turnover ratio

Debt-equity 0.00 0.00 0.16 0.21 0.29

ratio

Return equity 29.27 27.77 34.72 53.02 66.73

ratio

Gross profit 16.82 17.66 18.57 20.56 17.31

margin

37
CHANGE IN WORKING CAPITAL

S. N PARTICULAR MAR -2018 MAR-2019 MAR-2020

1 Current assets

Current investment 735.48 594.70 882.06

Inventories 594.58 718.89 633.53

Trade Receivables 230.32 350.96 242.23

Cash & cash equivalent 97.25 40.48 39.16

Short term loans advance 820.41 1121.41 1075.73

Other current assets 289.48 243.83 332.44

Total current assets 2767.52 3070.27 3205.15

2 Current liabilities

Short term borrowings 9.01 0.00 479.99

Trade payable 866.36 1032.54 955.98

Other current liabilities 319.61 361.30 596.39

Short term provisions 171.05 188.52 182.70

Total current liabilities 1366.03 1582.36 2215.06

Decrease working 1401.49 1487.91 990.09

capital

38
SN PARTICULAR MAR 2021 MAR
2022

1. Current assets

Current investment 1292.96 802.50

Inventories 991.28 1251.64

Trade Receivables 198.36 253.85

Cash & cash equivalent 110.80 52.29

Short term loans advance 946.09 698.00

Other current assets 475.44 534.78

Total current assets 4014.3 3593.06

2. Current liabilities

Short term borrowings 1075.70 1479.62

Trade payable 1191.09 1156.62

Other current liabilities 695.34 762.07

Short term provisions 365.63 451.16

Total current liabilities 3327.76 3849.47

Decrease working capital 687.17 256.41

39
DATA ANALYSIS AND INTERPRETATION

4.1 CURRENT RATIO

Current Ratio Table

Particular 2018 2019 2020 2021 2022

Current asset
2767.52 3070.27 3205.15 4014.93 3593.06
Current liabilities
1366.03 1582.36 2215.06 3327.76 3849.47
Current Ratio
2.02 1.94 1.44 1.20 0.93

Current Ratio Table

2.5

1.5

0.5

2018 2019 2020 2021 2022

series-1 Column1 Column2

Interpretation

The liquidity ratio compares current assets and current liabilities and indicates whether there are
sufficient current assets to pay off the current liabilities. From the above table, the company's current
ratio occupies the standard position of 2.0 only in 2018, the ratio is rising and will continue to drop
dramatically in 2019-2020 and 2020-2021. I understand.

40
4.2 QUICK RATIO:

Quick Ratio Table

Particular 2018 2019 2020 2021 2022

Current 2172.94 2351.57 2571.62 3023.65 2341.4

Asset-
2
Inventory

Current 1366.03 1582.36 2215.06 3327.76 3849.4

Liabilities
7

Quick Ratio 1.59 1.48 1.16 0.90 0.60

41
 1.6

1.4

1.2

0.8

0.6
20182 2019 2020 2021 2022
93201
0.4 Series 1 Column1 Column2

Interpretation
From above table the quick ratio of a company has a standard position only in the year of
2018are 1.59 ratio increases and 2019, 2020 ,2021 and 2022 ratio continuously Decreases.

42
 4.3 ASSET -TURNOVER RATIO

ASSET- TURNOVER RATIO TABLE

Particulars 2018 2019 2020 2021 2022

Net Sales 9304.06 10482.45 10986.68 12378.83 13371.62

Total 4161.72 5140.13 6453.15 7334.67 7209.48

Assets
Asset 2.23 2.03 1.70 1.68 1.85
Turnov
erRatio

Asset-Turnover Ratio

2.5

1.5

0.5

0 2019 2020 2022

2018 2021

Series 1 Column1 Column2

Interpretation
From above table the asset turnover is too lower in the year 2020-21, when compared to remaining
years 2018,2019,2020 and 2022 ratio is increasing.
43
4.4 FIXED ASSETTURNOVER RATIO

FIXED ASSETTURNOVER RATIO TABLE

Particul 2018 2019 2020 2021 2022

ars
Sales 9304. 1048 1098 1237 13371.62
06 2.45 6.68 8.83
Fixed 1231. 1392. 1499. 1515. 1912.70
Asset 55 51 45 50
Fixed 7.55 7.52 7.32 8.16 6.99
Asset
Turno
ver
Ratio

44
FIXED ASSETTURNOVER RATIO FIGURE

Fixed Asset Turnover Ratio

8.2
8
7.8
7.6
7.4
7.2
7
6.8 Series 1 Column1 Column2

6.6
6.4 2018 2019 2020 2021 2022

Interpretation
The table above that shows that asset turnover in 2020-2021 is too high compared to the rest the
Years (2018-19,2019-20). Therefore, the company has probably reached its limit, indicating that it
needs to increase its asset base (plants, real estate, equipment) to support sales or reduce production
capacity.

45
4.5 DEBT-EQUITY RATIO

DEBT-EQUITY RATIO TABLE

Particular 2018 2019 2020 2021 2022

Sales 9304.06 10482 1098 12378.83 13371.62

45 6.68

Fixe 1231.55 1392.5 149 1515.50 1912.70

d 1 9.45
Asset

Fixed 7.55 7.52 7.32 8.16 6.99

Asset
Turnover
Ratio

46
 Debt Equity Ratio Figure

8.2

7.8

7.6

7.4

7.2

6.8

6.6

6.4 2018 2019 2020 2021 2022

Series 1 Column1 Column2

INTERPRETATION

If the gearing ratio is greater than 0.2, the company's assets are financed by debt. If the ratio is less
than 0.1, the assets are primarily equity-funded. Britannia Industry Ltd. debt ratio from 2018 to 2020.
The lowest in the last three years, 0.29 in 2021-22. A low level of leverage indicates that the company
is doing well.

47
4.6 RETURN ON EQUITY RATIO

Particular 2018 2019 2020 2021 2022

Net profit after tax 947 1122 1484 1760 1603

Share capital Reserve 3235 4039 4274 3319 2402

Surplus

ReturnOn Equity 29.27 27.77 34.72 53.02 66.73

48
 Return on Equity Ratio

70

60

50

40

30
2018 2019 2020 2021 2022

Series 1 Column1 Column2

INTERPRETATION

Return on equity shows how well a company is making a profit on the investment it receives from its
shareholders. The table above shows Britannia Industries Ltd. High in 2021-22 (66.73%) and low in
2018-19 (27.77%).

49
4.7 GROSS- PROFIT MARGIN

GROSS- PROFIT MARGIN TABLE

Partic 2018 2019 2020 2021 2022

ular

Gross 1564. 1851.1 2040.9 2546.2 2315.1

profit 96 1 5 1 3
Net sale 9304. 10482. 10986. 12378. 13371.

06 45 68 83 62
Gross- 16.82 17.66 18.57 20.56 17.31
profit
margi
n

GROSS- PROFIT MARGIN FIGURE

Gross Profit Margin Figure Margin

2
5
2
0
1
5
1
0
5

0
201 201 202 202 202
8 9 0 1 2
Series 1 Column1
Column2

50
 INTERPRETATION

Over the past five years, Britannia Industries Ltd.'s gross margin has been growing steadily upwards.
This shows that the gross profit margin is increasing over time. It shows the steady development of the
company. From the table above, the gross margin will be high in 2021 (20.56%) and low in 2018
(16.82%).

4.8 NET PROFIT RATIO:

NET PROFIT RATIO TABLE

Particular 2018 2019 2020 2021 2022

Net
13,371.62 12,378.83 10,986.68 10,482.45 9,304.06
Profit
Net Sales 9304.06 10482.45 10986.68 12378.83 13371.62
Net 13,371.62 12,378.83 10,986.68 10,482.45 9,304.06
Profit
Ratio

51
NET PROFIT RATIO FIGURE

Net profit Ratio

16

14

12

10

2018 2019 2020 2021 2022

Series 1 Column1 Column2

INTERPRETATION:
Over the past five years, Britannia Industries Ltd.'s gross margin has been growing steadily
upwards. This
shows that the gross profit margin is increasing over time. It shows the steady development of the
company.
From the table above, the gross margin will be high in 2021 (20.56%) and low in 2018 (16.82%).

PROFIT EARNINGS RATIO:

PROFIT EARNINGS RATIO TABLE

Particular 2018 2019 2020 2021 2022

Market
Price 947.89 1122.20 1484.30 176003 1603.19
Per
Share

52
 Earnings
9304.06 10482.45 10986.68 12378.83 13371.62
per Share
Profit
Earnin 10.18 10.70 13.50 14.21 11.28
gs
Ratio

PROFIT EARNINGS RATIO FIGURE

14

12

10

2018 2019 2020 2021 2022

Series 1 Column2
Column1
INTERPRETATION

Over the past five years, Britannia Industries Ltd.'s gross margin has been growing steadily upwards.
This Shows that net profit margin is increasing over time. It shows the steady development of the
company. From the above table the net profile margin will be high in 2021 (14.21%

53
4.9 PROFIT EARNING RATIO

PROFIT EARNING RATIO TABLE

Particular 2018 2019 2020 2021 2022

Marketing per 1243 3082 2689 3627 3204

share

Earnings per 41.83 48.24 58.32 77.37 63.30

Share
Profit Earning 29.72 63.89 46.12 50.61
Ratio

PROFIT EARNING RATIO FIGURE

18

16

14

12

10

4 2018 2019 2020 2021 2022

Series 1 Column2 Column1

INTERPRETATION
Over the past five years, Britannia Industries Ltd.'s Profile Earning ratio has been growing steadily
upwards.
This shows that net profit margin is increasing over time. It shows the steady development of the
company.
From the above table the net profile margin will be high in 2022 (15.90%) and low in 2018 (10.50)

54
4.10 INVENTORY-TURNOVER RATIO

INVENTORY-TURNOVER RATIO TABLE

Particulars 2018 2019 2020 2021 2022

Cost of goods 9304.06 10482.45 10986.68 12378.83 13371.62

Sold

Average 4161.72 5140.13 6453.15 7334.67 7209.48

inventory

Invent 2.23 2.03 1.70 1.68 1.85

ory
turnov
er
ratio

INVENTORY-TURNOVER RATIO FIGURE

2.
5
2

1.
5
1

0.
5
0
201 201 202 202 202
8 9 0 1 2
Series 1 Column1
Column2

Interpretation
From above table the asset turnover is too lower in the year 2020-21, when compared to remaining
years 2018,2019,2020 and 2022 ratio is increasing.

55
 CHAPTER 5
MAJOR FINDING

56
• From 2018 to 2022, Britannia Industries Ltd.'s gross profit ratio increased steadily. 2018
saw a low of 16.82 percent and a high of 2021 (20.56%).

• Britannia Industries Ltd.'s return on equity peaked in 2021–2022 (66.73%) and fell in
2018–2019 (27.77%).

• In the years 2017–18, Britannia Industry Ltd. had a higher current ratio of 2.02, while in
the years 2021–22, it was lower at 0.93.

• Britannia Industry Ltd.'s higher liquid ratio was 1.59 in 2017–18, while its lower ratio was
0.60 in 2021–2022.

• Britannia Industry Ltd.'s debt-to-equity ratio has been low during the past three years, with
a value of 0.28 in 2019–20. A lower debt-to-equity ratio indicates strong business
performance.

• Britannia Industry Ltd.'s assets turnover ratio is lower (1.68) in 2020–2021 and higher
(2.23) in 2018.

5.1 DISCUSSION AND SUGGESTION

• Based on the research and examination of British industries during the previous five years,
we can draw some conclusions about how the business can operate more profitably and
efficiently.
• Britannia Industries Ltd.'s current ratio is low; it has to rise so that it can comfortably satisfy
its short-term obligations.
• In 2022, the company's liquidity ratio will drop. Thus, I recommended that the business
maintain a sufficient cash reserve. There should be a greater use of loan capital.
• Developing creative plans, initiatives, and regulations to oppose rivals; • Putting more
emphasis on utilizing the investment more profitably for shareholders.

57
5.2 CONCLUSION

Based on research conducted by Britannia Industries Ltd., we hypothesized that throughout the
previous five years (2018–2022), there has been an increase in the trends of gross margins,
capital adequacy ratios, and leverage ratios. Businesses are urged to manage and restrict the
expenses related to manufacturing, marketing, and selling their products in order to sustain the
rising trend in the upcoming year. Increasing sales and productivity are also crucial for raising
a company's profitability. Along with maintaining a steady net worth ratio, the company should
also maintain a stable long-term investment return curve to guarantee that its capital is well-
utilized and that shareholders receive fair dividends.

5.3 LIMITATIONS OF THE STUDY

• Confidential information such as financial situation is not fully disclosed.
• There are certainly setbacks when drawing conclusions.
• This survey is based on five annual reports only.
• Information from the annual report is insufficient to calculate some key figures. Further
analysis is not possible due to limited time.

58
 CHAPTER 6
BIBLIOGRAPHY

59
• Kothari C.R, (1990), Research methodology methods and techniques, University of
Rajasthan, New age international (p) limited.
• Gupta S.P & Gupta K.L. Management and cost accounting, Sahitya bhavan publication.
• Gupta Shashi k & Sharma RK, management accounting, kalyani publisher.
• Pandey I M, financial management, vikas publishing house pvt.ltd
• https://www.educba.com/ratio-analysistypes/
• https://www.educba.com/importance-of-ratio-analysis/
• http://britannia.co.in/
• https://money.rediff.com/companies/Britannia-Industries-Ltd/11120001/results-annual
• https://www.moneycontrol.com/financials/britanniaindustries/balance-sheetVI/BI
• https://money.rediff.com/companies/Britannia-Industries-Ltd/11120001/profit-and-loss

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Pakhtunkhwa cement sector. International Journal of Accounting and Financial
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WORD COUNT CHARACTER COUNT 8876 Words 49658

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PAGE COUNT FILE SIZE

70 Pages 2.1MB

SUBMISSION DATE REPORT DATE

Feb 20, 2024 11:52 PM GMT+5:30 Feb 20, 2024 11:53 PM GMT+5:30

8% Overall Similarity
The combined total of all matches, including overlapping sources, for each database.
4% Internet database0% Publications database
Crossref database Crossref Posted Content database
6% Submitted Works database

Excluded from Similarity Report

Bibliographic material Quoted material
Cited material Small Matches (Less then 14 words)

62