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“A Study Of Impacts Of Debt Raised Between 2005-2008 On Profitability (Profits after tax) And Liquidity (Liquid Assets) Of Krishna Maruti Ltd.” Submitted To : Submitted By: Miss. Garima Gupta Richa Nanda
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“A Study Of Impacts Of Debt Raised Between 2005-2008 On Profitability(Profits after tax) And Liquidity(Liquid Assets) Of Krishna Maruti Ltd.” Submitted To : Submitted By: Miss. Garima Gupta Richa Nanda H.O.D., M.B.A. 1133/08 T.I.M.T. M.B.A.(F)(S-1)
KML entered the auto interior manufacturing business with a single product (seating system for Maruti 800) in year 1994. Krishna Maruti Ltd. (KML) was incorporated in year 1994 as an ancillary to Maruti Udyog Ltd. (MUL), for the supply of Car seats. KML is joint venture between Mr. Ashok Kapur, MUL, and Suzuki Motor Corporation. introduction
Seating Systems • Rear View Mirrors • Head & Arm Rests • Seat Trims • Auditorium Seat • Injection Moulded Door Trims • Roofliners Products Of Krishna Maruti
Best Overall performance award • Best effort of Cost reduction award • Best effort for vendor up gradation award • KAIZEN award Major Awards From MUL
TS16949 • ISO 14000 • ISO 9002 • OSHAS 18000 • DEMING Award Quality Certificates
Focused • Fast • Flexible • Friendly • Firm • Fun 6 - F' principle
"RESPECT FOR INDIVIDUAL" KML philosophy
To study the impact of secured debt raised during 2005-2008 on the profitability of the company. • To study the impact of unsecured debt raised during 2005-2008 on the profitability of the company. • To study the impact of total debt raised during 2005-2008 on the profitability of the company. • To study the impact of secured debt raised during 2005-2008 on the liquidity of the company. • To study the impact of unsecured debt raised during 2005-2008 on the liquidity of the company. • To study the impact of total debt raised during 2005-2008 on the liquidity of the company. Objective of the study
CONSTRUCT Impact of debt on profitability and liquidity of the company VARIABLES independent : Debt Dependent : Profitability i.e. profit after tax Liquidity i.e. liquid assets Theoretical framework
The present study is descriptive in nature, as it seeks to discover ideas and insight to bring out new relationship.
For my project I have used the sample of 4 years i.e. 2005,2006,2007,2008. samples
H0: There is no significant impact of secured debt on profitability of the company. H1:There is significant impact of secured debt on profitability of the company. • H0:There is no significant impact of unsecured debt on profitability of the company. H1:There is no significant impact of secured debt on profitability of the company. • H0: There is no significant impact of total debt on profitability of the company. H1:There is no significant impact of total debt on profitability of the company. Hypothesis
H0: There is no significant impact of secured debt on liquidity of the company. H1:There is significant impact of secured debt on liquidity of the company. • H0:There is no significant impact of unsecured debt on liquidity of the company. H1:There is no significant impact of secured debt on liquidity of the company. • H0: There is no significant impact of total debt on liquidity of the company. H1:There is no significant impact of total debt on liquidity of the company.
Ratios Related To The Profitability And Liquidity Of Krishna Maruti Ltd.
Current Ratio • 2005 - 1.51 • 2006 - 1.42 • 2007 - 1.52 • 2008 - 1.42
Quick Ratio • 2005 - 0.79 • 2006 - 0.70 • 2007 - 0.58 • 2008 - 0.66
Gross profit ratio • 2005 – 25.52% • 2006 – 21.76% • 2007 – 19.18% • 2008 – 14.82%
Net Profit Ratio • 2005 – 1.5% • 2006 – 2.1% • 2007 – 1.6% • 2008 – 2.4%
ANOVA Analytical and Statistical Tools Applied
Let null hypothesis be that there is no significance effect of secured debt on the profitability of the company.
Let null hypothesis be that there is no significance effect of unsecured debt on the profitability of the company.
Let null hypothesis be that there is no significance effect of total debt on the profitability of the company
Let null hypothesis be that there is no significance effect of secured debt on the liquidity of the company.
Let null hypothesis be there is no significance effect of unsecured debt on liquidity.
Let null hypothesis be there is no effect of total debt on the liquidity of the company
Time constraint • Secondary data • Secrecy of internal data • Period of analysis Limitations of the study
. Results and discussions