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    Dipti Presentation Seminar

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    pandadiptimayee99
    This document discusses working capital management at Nalco. It defines working capital and net working capital, and outlines objectives like improving solvency. Data from 2016-2021 is analyzed to calculate ratios like current ratio and working capital turnover. Key findings are that Nalco has good liquidity and manages working capital efficiently, though profitability could be improved. The conclusion is that Nalco manages its finances and working capital well, allowing it to compete globally and earn Navratna status.

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    Dipti Presentation Seminar

    Uploaded by

    pandadiptimayee99
    13 views16 pages
    This document discusses working capital management at Nalco. It defines working capital and net working capital, and outlines objectives like improving solvency. Data from 2016-2021 is analyzed to calculate ratios like current ratio and working capital turnover. Key findings are that Nalco has good liquidity and manages working capital efficiently, though profitability could be improved. The conclusion is that Nalco manages its finances and working capital well, allowing it to compete globally and earn Navratna status.

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    This document discusses working capital management at Nalco. It defines working capital and net working capital, and outlines objectives like improving solvency. Data from 2016-2021 is analyzed to calculate ratios like current ratio and working capital turnover. Key findings are that Nalco has good liquidity and manages working capital efficiently, though profitability could be improved. The conclusion is that Nalco manages its finances and working capital well, allowing it to compete globally and earn Navratna status.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    13 views16 pages

    Dipti Presentation Seminar

    Uploaded by

    pandadiptimayee99
    This document discusses working capital management at Nalco. It defines working capital and net working capital, and outlines objectives like improving solvency. Data from 2016-2021 is analyzed to calculate ratios like current ratio and working capital turnover. Key findings are that Nalco has good liquidity and manages working capital efficiently, though profitability could be improved. The conclusion is that Nalco manages its finances and working capital well, allowing it to compete globally and earn Navratna status.

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    of 16

    WORKING CAPITAL

    MANAGEMENT OF

    Guided By Submitted
    By Prof.Debidutta Acharya Sandhya Rani Mishra
    Regd. No.-2106107043
    Introduction:
     The life blood of business,as is evident, signified funds required for day-to-day
    operation of the firm. The management of working capital assumes great
    importance because shortage of working capital funds perhaps the biggest
    possible cause of failure of many business units in recent times.

     Decision relating to working capital and short term financing are reffred to as
    working capital management. These involve managing the relationship
    between a firm’s assets and its short term liabilities.

     The goal of working capita lmanagement is to ensure that the firm is able to
    continue its operations and that it has sufficient money flow to satisfy both
    maturing short-term debt and upcoming operational expenses.
    Objectives:
     To determine the amount of working capital requirement and to
    calculate various ratios relating to working capital.

     To make an item wise study of the components of the working capital.

     To suggest the steps to be taken to increase the efficiency in


    management of working capital.
    Scope :
    Improve business solvency
    Ability to face crises
    Increase credit worthiness
    Better relations with supplier and creditors
    Helps in expansion
    Competitive advantage
    Limitations of the study:
    During the course of study of summer training project
    entitled Working Capital Management of Nalco the report
    has been prepared subject to the following limitations.
    1. The study is limited to five financial years from 2016 to 2021 performance.
    2. The data used in the study have been taken from balance sheet and their
    relatedschedule of Nalco.

    The study has been conducted during the boundaries of Nalco. The
    analysis ignores the time value of money.
    Data source and Methodology:
    Source of data collection: Secondary data
    . Net worth
    .Financial performance(Income&Net profit)
    . Financial position

    Duration of data: 2016-2021(Five years)


    Concepets of working capital:
    Balance sheet concept
    1. Gross working capital
    2. Net working capital
    Operating cycle or circular flow concept
    Operating cycle:
     The working capital cycle for a business is the length of time it takes to
    convert the total net working capital into cash.
    How to calulate WC?
     Working capital= Current Assets-Current Liabilities

     Net working capital= Accounts receivable + Inventory-Accounts


    payable

     Working capital turnover ratio= Net Sales/ Net working capital


    Data Analysis and Interpretation:
    Financial Performance
    Financial Position:
    Working Capital of NALCO(2021-22)
    (Amount in ₹ Crore)
     Working capital = current asset-current liabilities
    = 6,485.00-3,099.14
    = 3,385.86
    Net working capital= Trade receivables+Inventory- Trades payables
    = 75.25+1,646.17-1,457.1
    = 264.32
    Working capital Turnover Ratio= Net sales/ Net working capital
    = 3,289.98/264.32
    = 12.44
    Findings of the Study:
    Nalco is not providing credit sales to its customer.
    Nalco has a good liquidity position.
    The return generated by employing capital is not good.
    The profitability position also not satisfactory.
    Nalco is efficient in managing the working capital.
    The company has high liquid asset which is enough for
    repayment of short term liabilities.
    Moreover the company has good current ratio position,
    which shows that company uses its current assets
    efficiently.
    CONCLUSION
    ‘The financial statement analysis’ plays a vital role in helping the financial
    manager and top management of the company to plan and control their
    financial structural operations.
     It found that the company has a sound and effective policy and its performance
    is very good even in this bad recession situation company has managed to post
    good profit.
     Company is competing well at the domestic as well as the international level
    and it is among the low cost producers of aluminium in the world only.
     We can say that the companies management of finance and its working capital
    management system is very good because of which only the company has got
    the status of NAVRATNA company.
    BIBLOGRAPHY
    Financial Management………. Prasanna Chandra
    Financial Management………. I.M. Pandey
    Annual Report of NALCO
    Auditors Report, Directors Report and Investors
    Report.
    www.nalcoindia.com

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