1. ACTIVIDAD GENERAL
1.2. ANÁLISIS DE OFERTA
1.2.3. Sector Construcción
Cash plays very important role in the entire economic life of a business. A firm needs cash to make payments to its suppliers, to insure day-go-day expenses and to pay salaries, wages, interest and dividends etc. In fact, what blood is to a human body, cash is to a business enterprise It is very essential for a business to maintain an adequate balance at cash. But many a times, a concern operates profitability and yet it becomes very difficult to pay taxes and dividends this movement of cash is of vital importance to the management.
“A statement of changes in the Financial Position of firm on cash basis is called a cash flow statement”.
A cash flow statement summarises the causes of changes in cash position of a business enterprise between dates of two balance sheets. This statement is very much similar to the statement of changes in Financial Position Prepared on working capital basis, i.e., a funds flow statement, except that a cash flow statement focuses attention on cash instead of working capital. It is called a cash flow statement because it describes the Inflow (Sources) and out flow (use) of cash.
Financial performance with respect to operational performance (2010-2011):
Financial over view:
The Global Steel industry slowly started to recover from the melt down&
the second half of 2010-2011 has been encouraging for the steel industry as the demand has started to increase. RINL registered an increase in the turnover of 8.30% over the previous year. How ever, due to increase in input costs, the profit is adversely affected
Financial performance:
PARTICULARS FY 2010-2011 (Crs)
FY 2009-2010 (Crs)
% inc(+)/dec(-) Over previous year
Sales turnover 11517 10635 8
PBDIT 1412 1602 -12
Profit before tax 982 1248 -21 Profit after tax 658 797 -17
INTERPRETATION:
Profit before tax of 982 crores was lower by 266 crores over previous year(1248 crores). The profit margins strained during the current year due to steep increase of raw material prices especially basic raw
materials such as coal &iron ore.
Table NO 5.1 Balance Sheets ofVSP Ltd. From 2006-07 to 2010-11 Source of Funds (Rs in Crores)
PARTICULARS 31-03-2011 31-03-2010 31-03-2009 31-03-2008 31-03-2007
Share Holders Fund
Share Capital 7827.32 7827.32 7827.32 7827.32 7827.32 Reserve & surplus 5401.90 5057.68 4592.59 3653.72 1710.88 (A) 13229.22 12885.00 12419.91 11481.04 9538.20 Loan Funds
Secured Loans 274.89 407.28 907.72 332.78 604.45 Unsecured Loans 861.87 825.27 100.04 107.95 312.51
(B) 1136.76 1232.55 1007.76 440.73 916.96
Current liabilities
Liabilities 3271.43 2871.95 2560.79 1610.15 1011.53
Provisions 1336.06 1435.89 1620.53 1581.47 1092.77
(C) 4607.49 4307.84 4181.32 2104.30 2104.30
Deferred Tax Liability
(D) 79.97 97.82 124.49 163.12 291.29
Total (A+B+C) 19053.44 18523.21 17733.48 15276.51 12850.75
Table NO 5.2Application of Funds (Rs in Crores)
Gross Block 9794.60 9473.90 8971.80 8900.83 8875.62
Less:
Depreciation 8264.71 8008355 7749.74 7516.19 7085.16
Net Block 1529.89 1465.35 1222.06 1384.64 1790.46
Hold for
Disposal 0.03 0.05 0.05 0.04 0.00
Capital
work-in-progress 9536.71 7506.90 4652.00 2087.19 597.19
(A) 11066.63 8972.30 5874.11 3471.87 2387.65
Investment(B) 361.60 0.25 0.05 0.05 0.05
Current Assets
& Advances
Inventories 3254.71 2451.52 3215.28 1761.15 1203.24
Sundry debtors 330.61 181.18 191.27 93.41 216.80
Cash & Bank
Balance 1998.89 5415.54 6624.17 7699.11 7194.68
Others Assets 75.96 137.40 258.91 292.43 314.48
Loans &
Advances 1965.04 1365.02 1569.69 1958.49 1518.90
(C) 7625.21 9550.66 11859.32 11804.59 10448.10
Miscellaneous
Expenditure(D) 0.00 0.00 0.00 0.00 14.96
Profit & Loss
Account(E) 0.00 0.00 0.00 0.00 0.00
Total (A+B+C) 19053.44 18523.21 17733.48 15276.51 12850.75
Table NO 5.3 COMPARITIVE BALANCE SHEET OF VSP LTDFOR THE
Inventories (Stock) 2451.52 3254.71 803.19 32.76
Loans & Advances 1365.02 1965.04 600.02 43.95
Other Current Assets 137.4 75.96 -61.44 44.71
Miscellaneous Expenditure Profit & Loss Account
Investments 0.25 361.60 +361.35 144540
Fixed Assets 8972.30 11066.63 2094.33 23.34
Total Assets 18523.21 19053.44 530.23 2.86
LIABILITIES
Current Liabilities 2871.95 3271.43 399.48 13.90
Provisions 1435.89 1336.06 -99.83 -6.95
Secured Loans 407.28 274.89 -112.39 -29.02
Unsecured Loans 825.27 861.87 16.64 1.96
Deferred Tax Liability 97.82 79.97 -17.85 -18.24
Reserves & Surplus 5057.68 5401.90 344.22 6.80
Share Capital 7827.32 7827.32 -0.05 -0.0006
Total Liabilities 18523 19053.44 530.23 2.86
Interpretation
The fixed assets for the period of 2009-10 is 8972.30 i.e. 48.43% &
2010-11 is 11066.63 i.e. 58.43% it has been increased23.34%.
The total assets for the period of 2009-10 is 18523.21 i.e. 100% &
2010-11 is19053.44 i.e. is 100%.
The current liabilities for the period 2009-10 is 2871.95 i.e. 15.50
%& 2010-11 is 3271.43 i.e. 17.31%, this has been increased by 13.90%.
Table NO 5.4 COMPARITIVE BALANCE SHEET OF VSP LTD. FOR THE
Balance 6624.17 5415.54 -1208.63 -18.24
Sundry
Debtors 191.27 181.18 -10.09 -5.27
Inventories
(Stock) 3215.28 2451.52 -763.76 -23.75
Loans &
Advances 1569.69 1365.02 -204.67 -13.03
Other
Investments 0.05 0.25 +0.2 +4.00
Fixed Assets 5874.11 8972.30 +3098.19 +52.74 Total Assets 17733.4
8 18523.2
1 +789.73 +4.45
LIABILITIES Current
Liabilities 2560.79 2871.95 +311.16 +12.15
Provisions 1620.53 1435.89 -184.64 -11.39
Secured Loans
907.72 407.28 -500.44 -55.13
Unsecured
Loans 100.04 825.27 +725.23 +724.94
Deferred Tax
Liability 124.49 97.82 -26.67 -21.42
Reserves &
Surplus 4592.59 5057.68 +465.09 +10.12
Share Capital 7827.32 7827.32 Total
Liabilities 17733.4
8 18523 +789.73 4.45
Interpretation
The fixed assets for the period of 2008-09 is 5874.11 i.e. 33.12% &
2009-10 is 8972.30 i.e. 48.43% it has been increased 15.31%.
The total assets for the period of 2008-09 is 17733.48 i.e. 100% &
2009-10 is 18523.21 i.e. is 100%.
The current liabilities for the period 2008-09 is 2560.79 i.e.
14.44% & 2009-10 is 2871.95 i.e. 15.50%, this has been increased by 1.06%.
Table NO 5.5 COMPARITIVE BALANCE SHEET OF VSP LTD. FOR THE YEARS 2007-08 and 2008-09
PARTICULARS 2007-08
Rs. Crs. 2008-09
Rs. Crs. Increase/Decrease
Rs. Crs. Increase/Decrease Percentage A SSETS:
Cash & Bank
Balance 7699.11 6624.17 -1074.94 -13.96
Sundry 93.41 191.27 +97.86 +104.76
Debtors Inventories
(Stock) 1761.15 3215.28 +1454.13 +82.56
Loans &
Advances 1958.49 1569.69 -388.8 -19.85
Other Current
Assets 292.43 258.91 -33.52 -11.46
Miscellaneous Expenditure Profit & Loss Account
Investments 0.05 0.05
Fixed Assets 3471.87 5874.11 +2402.24 +69.19
Total Assets 15276.51 17733.48 +2456.97 +16.08
LIABILITIES Current
Liabilities 1610.15 2560.79 +950.64 +59.04
Provisions 1518.47 1620.53 +102.06 +6.72
Secured Loans 332.78 907.72 +574.94 +172.76
Unsecured
Loans 107.95 100.04 -7.91 -7.32
Deferred Tax
Liability 163.12 124.49 -38.63 -23.68
Reserves &
Surplus 3653.72 4592.59 +938.87 +25.69
Share Capital 7827.32 7827.32
Total Liabilities 15276.51 17733.48 +2456.97 +16.08
Interpretation
The cash and bank balance was decreased from 7699.11(crores) to 6624.17 ((crores) i.e -1074.94 (crores) (-13.96%). It indicates that liquidity position of the VSP decreased
The Fixed assets were increased from 3471.67(crores) to 5874.11 (crores) i.e +2402.24 (crores) (69.19%). It indicates that the VSP’s interest on long term benefits through invest on fixed assets
Current liabilities were increased from 1610.15 (crores) to 2560.79 (crores) i.e +950.64 (crores) (+59.04%). It indicates that the working capital position becoming critical.
Table NO 5.6 COMPARITIVE BALANCE SHEET OF VSP LTD. FOR THE YEARS 2006-07 and 2007-08
PARTICULAR
Debtors 216.80 93.41 -123.39 -56.91
Inventories
(Stock) 1203.24 1761.15 +557.91 +46.36
Loans &
Advances 1518.90 1958.49 +439.59 +28.94
Other
Account ____ _____ ______ _______
Investments 0.05 0.05 _____ ______
Fixed Assets 2387.65 3471.87 +1084.22 +45.40
Total Assets 12850.7
5 15276.5
1 +2425.76 +18.87
LIABILITIES Current
Liabilities 1011.53 1610.15 +598.62 +59.17
Provisions 1092.77 1518.47 +445.7 +38.95
Secured
Loans 604.45 332.78 -271.67 -44.94
Unsecured
Loans 312.51 107.95 -204.56 -65.45
Deferred Tax
Liability 291.29 163.12 -128.17 -44.00
Reserves & 1710.88 3653.72 +1942.84 +113.55
Surplus
Share Capital 7827.32 7827.32 _______ _____
Total
Liabilities 12850.7
5 15276.5
1 +2425.76 +18.87
Interpretation
The cash and bank balance was increased from 7194.68(crores) to 7699.11 (crores) i.e +504.43(crores) (+7.01%). It indicates that the VSP’s liquidity position was better than previous year.
The Investments are constant last two years and also the investments are very low. It indicates the firm’s disinterest on invest on other sectors.
The secured and unsecured loans were decreased from 2006-07 to 2007-08 i.e 476.23 (crores). It shows the VSP’s financial position becoming healthy.
Table NO 5.2.1Common Size Balance Sheet of 2010-11 and 2009-10 PARTICULARS 2010-11
3254.71 17.08 2451.52 13.23
Loans & Advances
Total Assets 19053.44 100 18523.2
1 100
LIABILITIES
Current Liabilities
Total Liabilities
19053.44 100
18523.48 100
Interpretation
The fixed assets for the period of 2009-’10 8972.30 i.e.
48.43% & 2010-’11 is 11066.63 i.e., 59.20 % it has been increased 10.77%.
The Total assets for the period of 2009-’10 18523.21 i.e., 100% &
2010-’11 is 19053.44 i.e., is 100%.
The current liabilities for the period 2009-’10 2871.95 i.e., 15.50%
& 2010-’11 is 3279.43 i.e.,17.16% this has been increased by 1.66%.
Table NO 5.2.2COMMON SIZE BALANCE SHEET OF 2009-10 AND 2008-09
Current & Bank Balance 5415.54 29.23 6624.17 37.35
Sundry Debtors 181.18 0.97 191
.27 0.01
Inventories 2451.52 13.23 3215.28 18.13
Loans & Advances 1365.02 7.36 1569.69 8.85