A

SUMMER TRAINING PROJECT REPORT

ON

A STUDY ON PERFORMANCE ANALYSIS OF NCL, BINA : BY USING

RATIO ANALYSIS

Dr. A.P.J. Abdul Kalam Technical University, Lucknow

for the partial fulfillment of

MASTER OF BUSINESS ADMINISTRATION

(2018-20)

SUBMITTED TO : SUBMITTED BY:

DR. SANGHAMITRA DAS PRAVEEN KR YADAV

(ASSISTANT PROFESSOR) MBA3RDSEMESTER

AKGIM, GHAZIABAD R NO.: 1882070043

AJAY KUMAR GARG INSTITUTE OF MANAGEMENT

27TH K.M Stone, NH-24,

Delhi-Hapur Bypass Road,

Adhyatmik Nagar,Ghaziabad -201009.

1
 DECLARATION

I Praveen Kr. Yadav student of 2nd year MBA from AJAY KUMAR GARG

INSTITUTE OF MANAGEMENT, GHAZIABAD hereby declare that the project

work entitled “ A STUDY ON PERFORMANCE ANALYSIS OF NCL, BINA BY

USING RATIO ANALYSIS” is carried out independently under guidance of Mr.

SHUBHAM AGARWAL (AFM at NCL, BINA).

This Project Report submitted to AJAY KUMAR GARG INSTITUTE OF

MANAGEMENT, GHAZIABAD, in the partial fulfillment of the requirements for

the award of MBA. I further declare that this report is based on the original project

study done by me.

Praveen Kr. Yadav

R.No. : 1882070043

2
 ACKNOWLEDGEMENT

I owe my gratitude to many people who helped and supported me during the entire

Summer Training. My sincere thanks to Dr. Sanghamitra Das, the Faculty Guide of

the project, for initiating and guiding the project with attention and care. She has

always been available for me to put me on track from time to time to bring the project

at its present form.

My deep sense of gratitude is due to Mr. Shubham Agarwal (Assistant Finance

Manager at NCL, Bina) allowing me to carry out the Summer Internship and this

Project at the organization and to be constantly available to me for the period, for

guidance. He also helped me to see the subject of study in its proper perspective.

I also thank all faculty members without whom this project would have been a distant

reality.

Praveen Kr. Yadav

AJAY KUMAR GARG INSTITUTE OF MANAGEMENT

3
 TO WHOM SO EVER IT MAY CONCERN

This is to certify that work entitled “ A STUDY ON PERFORMANCE

ANALYSIS OF NCL, BINA BY USING RATIO ANALYSIS ” is a Summer
Training Project Report work done by “Praveen Kr. Yadav” bearing Roll No.
“1882070043” Under my supervision for partial fulfillment of Master of
Business Administration (MBA) at Ajay Kumar Garg Institute of Management,
affiliated to Dr. A.P.J. Abdul Kalam Technical University, U.P., Lucknow
(Formerly Uttar Pradesh Technical University).

I wish him/her all the best for the future endeavors.

Dr. Sanghamitra Das

ASSISTANT PROFESSOR

AKGIM, Ghaziabad

4
 TABLE OF CONTENTS

S.NO. Topics Page no.

EXECUTIVE SUMMARY
1. 6

2. COMPANY PROFILE 8-28

3. INTRODUCTION TO THE PROJECT 29-34

4. LITERATURE REVIEW 35-45

5. RESEARCH OBJECTIVES 46-47

6. RESEARCH METHODOLOGY 48-49

7. DATA ANALYSIS & INTERPRETATION 50-58

8. FINDINGS 59

9. CONCLUSION 60

10. RECOMMENDATIONS 61

11. LIMITATIONS OF THE STUDY 62

12. BIBLIOGRAPHY 63-64

13. APPENDICES 64-68

EXECUTIVE SUMMARY

5
India is the third largest coal producer in the world and the eighth largest importer.

With annual production of 310 million tonnes and imports of almost 25 million

tonnes, coal provides one-third of energy supply in India. The Indian government

forecasts huge increases in electricity capacity based on coal, and a financially

viable electricity industry will be necessary to support reforms in the coal industry.

This report describes the Indian coal sector, and comments on government policies

and the performance of India's largely state-owned coal companies. There is a

substantial need for reforms in India's coal sector to improve efficiency and

competitiveness.

With the growth of the Indian economy due to various factors like Industralization,

Growth of Infrastructure, Institutional Development etc. the power is going to be

the main key for any development so the Coal is wodely used by the power

industries for generating the power.

Financial statement analysis is important to board of the Directors, Managers,

Payers, Lenders, and others who make judgments about the financial health of

organizations. One widely accepted method of assessing financial statements is

ratio analysis, which uses data from the balance sheet and income statement to

produce values that have easily interpreted financial meaning. The purpose of this

project was to get awareness about how an organization works.

The project was carried out for study and analyzing the financial condition of

Northern Coalfields Limited with special reference of Bina Project. It was done to

know that what is the current financial scenario of the company. In this project report

6
I have made Ratio Analysis for analyzing that that what are the different ratios

available in the organization and what is current growth comparing to the last year.

7
 PART-A

(COMPANY PROFILE)

8
Northern Coalfields Limited was formed in November 1985 as a subsidiary

company of Coal India Limited. Its headquarter is located at Singrauli, Distt.

Singrauli (M.P.). Singrauli is connected by road with Varanasi (220 Km ), The

nearest railway station is Singrauli located on the Katni-Chopan branch line

running parallel to the northern boundary of the Coalfield. The nearest railway

station for reaching directly to Delhi is Renukoot that is located on the Garhwa-

Chopan rail-line. Nearest (private) airstrip is at Muirpur (60 Km.).

The area of Singrauli Coalfields is about 2202 Sq.Km. The coalfield can be

divided into two basins, viz. Moher sub-basin (312 Sq.Km.) and Singrauli Main

basin (1890 Sq.Km.). Major part of the Moher sub-basin lies in the Sidhi district of

Madhya Pradesh and a small part lies in the Sonebhadra district of Uttar Pradesh.

Singrauli main basin lies in the western part of the coalfield and is largely

unexplored. The present coal mining activities and future blocks are concentrated

in Moher sub-basin.

The exploration carried out by GSI/NCDC/CMPDI has proved abundant resource

of power grade coal in the area. This in conjunction with easy water resource from

Govind Ballabh Pant Sagar makes this region an ideal location for high capacity

9
pithead power plants. The coal supplies from NCL has made it possible to produce

about 10515 MW of electricity from pithead power plants of National Thermal

Power Corporation (NTPC), Uttar Pradesh Rajya Vidyut Utpadan Nigam Ltd

(UPRVUNL) and Renupower division of M/s. Hindalco Industries. The region is

now called the "power capital of India". The ultimate capacity of power generation

of these power plants is 13295 MW and NCL is fully prepared to meet the

increased demand of coal for the purpose. In addition, NCL is also supplying coal

to power plants of Rajasthan Rajya Vidyut Utpadan Nigam Ltd, Delhi Vidyut

Board (DVB) and Hariyana State Electricity Board.

NCL produces coal through mechanised opencast mines but its commitments

towards environmental protection is total. It is one of very few companies engaged

in mining activities, which has got unified Integrated Management System (IMS)

complying to Standard ISO 9001:2008, ISO 14001:2004, OHSAS 18001:2007 and

SA 8000:2008 for simultaneous management of economic, environmental,

occupational health and safety, and social concerns.

NCL, through its community development programmes, has significantly

contributed towards improvement and development of the area. It is helping local

tribal, non-tribal and project-affected persons in overall improvement of quality of

their life through self-employments schemes, imparting education and providing

health care.

10
 VISION STATEMENT

“To emerge as a global player in the primary energy sector committed to provide

energy security to the country by attaining environmentally & socially sustainable

growth through best practices from mine to market.”

MISSION STATEMENT

“To produce and market the planned quantity of coal and coal products efficiently and

economically in an eco-friendly manner with due regard to safety, conservation and

quality”.

OBJECTIVES OF THE COMPANY

 To ensure planned production of coal efficiently, matching with increasing

demand of coal, which is the prime source of energy for the nation.

 To generate safety awareness amongst employees as also to create safe

working culture.

 To ensure clean, green and pollution free environment at working places and

also at surrounding areas.

 To ensure optimum capacity utilisation of men, machinery and available

resources.

 To ensure cost control by developing cost consciousness.

 To ensure strict quality control for better consumer satisfaction.

 To ensure perfect manpower planning and also harness the best out of

available human resource.

 To ensure improved quality of life of work force through welfare measures

11
  To be concerned for the community especially for the tribal and backward

sections of the society residing in and around mining projects.

 To ensure rehabilitation of project affected people (PAP) as per the guidelines

provided by Coal India Limited and approved by the Ministry of Coal and also

taking PAPs into confidence to elicit their co-operation in achieving Corporate

Objectives.

 To develop good work culture through disciplined, contended and motivated

 workforce for achieving Organizational Objectives.

Our Products-

NON-COKING COAL:

 Mainly used as thermal grade coal for power generation

 Also used for cement, fertilizer, glass, ceramic, paper, chemical and brick

manufacturing, and for other heating purposes.

WASHED AND BENEFICIATED COAL:

These coals have undergone the process of coal washing or coal beneficiation,

resulting in value addition of coal due to reduction in ash percentage.

 Used in manufacturing of hard coke for steel making

 Beneficiated and washed non-coking coal is used mainly for power generation

 Beneficiated non-coking coal is used by cement, sponge iron and other

industrial plants

12
REJECTS:

Rejects are the products of coal beneficiation process after separation of cleans and /

or middlings, as a fraction of feed raw coal.

 Used for Fluidized Bed Combustion (FBC) Boilers for power generation, road

repairs, briquette (domestic fuel) making, land filling, etc.

13
 PRINCIPAL EXECUTIVES

NAME DESGNATION

Shri P. K. Sinha Chairman-cum-Managing Director

Shri Gunadhar Pandey Functional Director

Functional Director
Shri M. K. Prasad

Shri N. N. Thakur Functional Director

Smt.Reena Sinha Puri Part-Time Official Director

Shri S N Prasad Part-Time Official Director

Prof. A. K. Agarwal Non Official Director

Shri B. P. Pandey Non Official Director

Shri Sunil Agarwal Permanent Invitees

Shri S. K. Jha Permanent Invitees

14
Environment
Northern Coalfields Limited (NCL) has voluntarily chosen to implement a

company wide comprehensive and unified integrated management system (IMS)

complying to Standard ISO 9001:2008, ISO 14001:2004, OHSAS 18001:2007 and

SA 8000:2008 for simultaneous management of economic, environmental,

occupational health and safety, and social concerns. The company has framed its

own Corporate Management Policy and committed to achieve the organizational

objectives and targets. Environmental Policy under earlier Environmental

Management System (EMS) and Quality Policy under earlier Quality Management

System (QMS) has now been superceded by Corporate Management Policy under

IMS.

INTEGRATED MANAGEMENT SYSTEM (IMS) CERTIFICATION

 Initially ISO 14001:1996 certificate was awarded to NCL for its eight working

projects namely Kakri, Bina, Dudhichua, Jayant, Khadia, Nigahi, Amlohri &

Jhingurda; by M/S DNV (Det Norske Veritas) in the year 2001 for adoption of

EMS (Environmental Management System), which was subsequently updated

to ISO 14001:2004 in June 2006 by DNV and was valid till 18th January

2010.

After implementation of IMS (Integrated Management System) from 1st July

2009 the auditing and certification is being done by M/s QMS Certification

Services Pvt. Ltd whose lead auditor after conducting audit has recommended

for continuation of certification for whole NCL.

15
 ISO 9001:2000: ISO 9001:2000 certificate was awarded to whole NCL on

11th May 2009 which was subsequently updated to ISO 9001:2008 on 15th

June 2010 by Certification International (UK) Limited, UK which is valid till

10th May 2012. However with implementation of IMS the auditing and

certification is being done by M/s QMS Certification Services Pvt. Ltd whose

lead auditor after conducting audit has recommended for continuation of

Certification.

 OHSAS 18001:2007 :- Stage-2 audit has been completed by lead auditor of

M/s QMS, Certification Services Pvt. Ltd in which one major non-compliance

was reported. Corrective Action report has been submitted to them.

Recommendation for certification is awaited.

 SA 800:2008 :- Stage-1 audit for SA 8000:2008 had been completed in

January 2010, in which 20 non-compliances were reported by lead auditor of

M/s QMS Certification Services Pvt. Ltd. Corrective action plan has already

been submitted. Stage-2 audit is to be held from 14.03.2011 to 18.03.2011 by

audit team of 04 auditors from 14th to 18th March 2011.

POLLUTION CONTROL
All the mines in NCL are taking following measure for mitigation of
Pollution.

1. Air Pollution : Air pollution control measures adopted by NCL are :

o Drills are provided with dust extractors to control dust at source.

o Approach roads to mines and service roads are provided with black

topping to reduce dust generation.

16
o Water sprinklers of fixed type and mobile type are deployed for dust

suppression on haul roads.

o Automatic sprinklers, actuated through sensors, are installed at

receiving pits.

o Fixed sprinklers are provided and operated through valve control

system at coal bunkers, transfer points and loading points.

o Dust cyclones are provided at bottom of receiving pits of crusher

house.

o Coal Handling Plants (CHP) have been fully enclosed to reduce coal

dust emission out side it.

o Coal is loaded to Merry Go Round (MGR) System through Rapid

Loading System in moist form.

o To despatch by truck, coal is wetted after loading and then covered

with tarpaulin.

o Routine maintenance and periodic over-hauling of Heavy Earth

Moving Machineries (HEMM) are carried out to reduce gaseous

emission.

o Thick green belt curtain, in the form of tall plants with broader leaves,

have been provided at mine boundaries to arrest air borne dusts.

o Under Over Burden (OB) dump reclamation plan, non-active OB

dumps are provided with vegetative covers to prevent dust emission.

o Provision made for dust proof cabins in HEMM and dust masks to

employees exposed to dust.

o Fire hydrant system installed at CHPs, Coal Dumps, etc.

17
2. Water Pollution : Water pollution control measures adopted by NCL:

o Sewage Treatment Plant (STP): Domestic STPs have been constructed

in the township with extended aeration process. Plant contains aeration

units for oxidation, clarifiers for removal of suspended solids, sludge

drying beds, grit removal facilities, sewer lines, manholes, pump

houses, control room, etc. Treated water is taken for reuse in tree

plantation, horticulture, construction activities. Dried sludge is a

valuable manure for tree plantation and horticulture works.

o Effluent Treatment Plant (ETP): Integrated Industrial ETPs are

designed for average discharge from mines, workshops and CHPs The

plant contains traps for recovery of oil & grease, clarifiers for removal

of suspended solids, flush mixers for chemical dosing, sludge drying

beds and pumping arrangements. Treated water is reused for tanker

filling, sprinklers, etc. Dried sludge are buried in lined pits.

o Silt Arrestors: Substantial amount of silts are carried along with run off

water. Catch drains with silt arrestors are provided in mines area.

Those are cleaned at regular intervals. Check dams and siltation ponds

are provided to arrest silt flowing into the watercourse. Gabions (loose

boulders packed in wire crates) are provided at toe of the active dumps

and across the water course with filter pad to stop silt escape into water

body.

o Oil Recovery: Used oils are collected in lid tight steel drums which are

stored on paved platform covered with shed. Floating oils recovered

from oil & grease traps are collected in drums and stored on a raised

18
 paved platform having drains to collect back spillages. Authorization

for handling Hazardous Waste are obtained from SPCB. Oils in drums

are sold through M. Junction, Kolkatta by way of e-auction to the

registered recycler of CPCB having valid consent for Air & Water and

authorization for handling hazardous waste from SPCB.

3. Noise & Ground Vibration Control Measures : Noise Pollution Control

measures adopted by NCL:

o Blasting operations are carried out between 1200 to 1500 hrs being

lean period for project work.

o Ear muff and plugs are provided to employees under effect of noise.

o Curtain plantations are provided at mine boundaries.

o Routine maintenance of all equipment is done to control noise and

vibration.

4. Technical & Biological Reclamation of External OB Dumps of Opencast

Mines:

Vegetative covers over bare OB dumps have been provided in major projects.

It ensures stability to dump slopes, minimization of erosion due to wind & rain

water. The dumps have been reclaimed by constructing proper benching and

providing reinforced grass-mat covers, gabions and drains. The slope surface

has been covered with mixture of grass-seeds, agricultural soil and manure

laid in coir/ hay/ straw / geo-textile-mat. The plantation of trees, shrubs and

grass has been done profusely on crowns of dumps, ring bunds, dykes, recess,

slopes, etc to ensure thick biological growth. For maintaining vegetative

cover, water sprinklers have also been deployed at specific points.

19
Manpower Profile

NCL has recognized the human resource development as a key function and has

adopted corporate policy towards its development. With the introduction of highly

sophisticated earth moving machines, the operators' maintenance crew and front line

managers have become the most critical human capital for achieving the corporate

goals.

Strategy

The massive intake of highly sophisticated equipment necessitated manifold training

and developmental activities for the transfer of technology. The strategy adopted by

the company is as under:

 Human Resources are utilized to the optimum level

 Identification of the areas of economic activities that are seriously

handicapped due to shortage of Technical, Professional and Skilled

Manpower.

 Training and continuing education of Critical Manpower.

 Computerization at Corporate and Mine level for all operations..

Objectives

 To provide every employee an opportunity learn to wipe out performance

gaps.  

20
  To organize need based Management Development Programmes for

Executives and Supervisor.

 To develop training/reference materials and to organize special programmeson

new equipment for all levels of personnel.

TRAINING AND DEVLOPMENT

In-Company Training

Its central institute, known as Central Excavation Training Institute (CETI) at

Singrauli, provides major training interventions at NCL. It caters to the

training/skill up gradation needs of operators, supervisors and front line managers.

The major activities of CETI is as under :

 Basic Courses for Operators and Technicians

 Refresher Courses for Operators &Technicians

 OEM's Programmes on technology up gradation

 Supervisory Development Programmes both Managerial and Technical

 Managerial Development Programmes for Executives

 Workers Development Programmes including Leadership Development

Programmes

 Basic Computer Learning Courses for Executives & Supervisors

 Special Programmes on current needs

 Seminars and Workshops on contemporary issues

INFORMATION TECHNOLOGY

Infrastructure at NCL

21
  NCL-HQ and all projects are equipped with High-speed Fiber Optic based

LAN.

 LANs of all projects are linked to LAN at HQ through Fiber Optic Backbone

Application Software Packages

 An ERP package namely Integrated Business Solution (IBS) has been

implemented at NCL. This package covers following modules:-

1. Materials Management

2. Maintenance Management

3. Production

4. Sales

5. MIS

 GPS based Truck Despatch System named OITDS has been installed at Jayant

Project and is fully operational.

 Centralised Payroll System, Executive Information System & Non-executive

Information System are in operation at NCL-HQ.

 GPS based Truck Despatch System is being installed at Dudhichua, Khadia,

Nigahi and Amlohri Projects of NCL by M/s Leica Geosystem Pty Ltd,

Australia through its executing partner M/s Elcome Technology Limited.

 Surpac software for Mine Planning & Survey has been installed at Dudhichua,

Khadia, Nigahi, Bina, Kakri, Jhingurda, Jayant, Amlohri Project and NCL

Headquarters.

Future Programme

 Upgradation of LAN at HQ by Gigabit LAN.

22
 Implementation of Safety and Environment Management System.

 Implementation of CCTV based surveillance system at Nigahi.

 Implementation of Attendance Recording System at NCL HQ.

Production
Coal Production

 Mining history in this region is very old. The first systematic mining,

however, was started by NCDC in Jhingurda during early sixties. The master

plan of the coalfield (Moher Basin) was prepared by P&D Division of

NCDC in consultation with Soviet Experts. This envisaged construction of

large mechanised opencast mines. The mining activities are going on as per

the master plan provisions. NCL, during successive years has not only

achieved targets of production but also exceeded them.

 During 2010-11, coal production of NCL was 66.253 Mill Tes. In 2011-12,

the target for coal production is fixed at 68.50 Mill. Tes. . NCL has excellent

record of capacity utilization , which is   74.79  %  in 2010-11. The

productivity in terms of OMS (out put per man shift) of NCL during 2010-11

was  13.52 Tonnes . It is planned to remove 239.00 Mill Cum of overburden

during 2011-12, out of which 120.00 Mill. Cum. will be removed

departmentally and rest 119.0 Mill. Cum. will be removed by Hiring of

Equipment(HOE) agencies.

23
Major Equipment in use in NCL

(As on 1st March'2011)

Total
EQUIPMENT
Nos.
DRAGLINE: 24/96 w2000: 12 nos.; ESH 20/90: 04 nos.; 15/90 ESH: 01
19
no.; 10/70 ESH: 02 nos.
SHOVEL: 20 CuM: 06 nos.; 12.5 CuM: 02 nos.; 11/ 10/9.5 CuM: 69 no;
104
others: 27 nos.
DUMPERS: 170T: 11 nos.; 120T: 153 nos.; 100T -109; 85T: 299 nos. 572
DRILLS: 311mm: 12 nos.; 250mm: 76 nos.; 160mm: 35 nos.; 100mm: 03
126
nos.
DOZERS: 860- 770 HP: 11 nos.; 480HP: 08 nos.;  410HP: 125 nos.; others
157
- 13 others: 13 nos.;
PAY LOADERS:  11.5 Cum 1; 6.4 - 6.1: 4; 5.7 CuM & below: 11 nos. 16
GRADER 280 HP: 41 nos.; 145 HP: 8 nos. 49
WATER SPRINKLER 85 T: 9 nos.; 50 T: 03 nos.; 28 KL or 35 T: 36
46
nos.;
 Production Programme

 NCL has ten working Opencast Coal Projects, which produced 70.021

Million Tonnes of coal during 2012-13. In addition to the five completed

projects viz. Dudhichua OCP, Jhingurdah OCM, Jayant OCP, Kakri OCP

and Khadia OCP, presently five projects viz. Amlohri Expansion OCP, Bina

Extension OCP, Block-B OCP, Krishnashila OCP and Nigahi Expansion

OCP are under project implementation stage and five new projects viz.

Dudhichua Expansion OCP, Jayant Expn. OCP, Block-B expn, Semaria and

Bina-Kakri amalgamation are under different stages of approval. To meet the

24
 enhanced demand of coal, an Emergency Coal Production Plan is under

implementation.

 Details of the Production of NCL in XIth Plan :

BALANC PRODUCTION (Mill.

SANCTIONED
E Tes.)
2013-
RESERV
2012-
CAPITA 14 2016-17
PROJECT ES (MT)
CAPACIT 13
L (Targe (Planne
AS ON
Y (Mtpa) (Actua
(Rs.Crs.) t) d)
01/04/201
l)
AAP
3
EXISTING AND COMPLETED PROJECTS
JHINGURDAH 3.00 63.12 6.678 1.126 1.525 0
JAYANT 10.00 375.04 310.824 12.700 11.00 10.0
DUDHICHUA 10.00 1281.39 341.231 12.229 14.00 10.0
KAKRI 3.00 186.59 37.009 2.700 2.00 0
KHADIA 10.00 1131.28 287.825 4.375 5.00 9.0
SUB
36.00 3037.42 983.567 33.13 33.525 29.0
TOTAL(A)
ONGOING PROJECTS
AMLOHRI
10.0 1143.54 270.138 7.501 8.50 10.0
EXPN.
BINA EXTN. 6.0 138.97 84.45 6.500 7.00 6.0
BLOCK-B 3.50 437.34 66.546 4.375 4.375 4.0
KRISHNASHI
4.0 741.56 81.892 5.000 5.00 5.0
LA
NIGAHI
15.0 259.40 389.125 13.515 14.0 15.0
EXPN.
SUB
38.50 2720.81 892.151 36.891 38.875 40.0
TOTAL(B)
TOTAL(A+B) 74.50 5758.23 1875.718 70.021 72.40 69.0
NEW PROJECTS

25
 Included

DUDHICHUA with
5.0 - - - 5.0
EXPN. Dudhichu

a
JAYANT Included
5.0 - - - 5.0
EXPN. with JNT
BLOCK-B
2.5 -   - - 0.3
EXPN.
Semaria 2.0         0.2
Bina Kakri
10.0         0.5
amalgamation
Total©           11.0
Grand
          80.0
Total(A+B+C)

International Standards

 ISO 14000 Certification for Environmental Management System since 2001

and renewed up to 2010.

 ISO 9001:2000 Certification for Quality Management System since 11 May

2009 and valid until 14 November 2010.

 Efforts for certification of Integrated Management System complyin ISO

14001:2004, ISO 9001:2008, OHSAS 18001:2007 and SA 8000:2008 are

being made and stage- 1 audit for the same is scheduled from 04.01.2010 by

the Certification Body.

Awards and achievements

26
  Prestigious “ INDIRA GANDHI NATIONAL AWARD FOR

EXCELLENCE” Given to the BEST ENTERPRISES Amongst the Public

Sector

 NATIONAL SAFETY AWARDS ( By the Hon’ble President of India)

 Four Awards of Excellence ( By the Hon’ble Prime Minister for Bina,

Nigahi, Amlohri And Jhingurda Projects

 National Award for promotion of Family Planning

 Coal India Award of Excellence

 For excellence in pollution Control – Indira Gandhi National Gold Award

 Jawaharlal Nehru Memorial National Award

 Dadabhai Naoroji International Millennium Award

 Teri National Award for Environment

 Best Chief Executive Gold Award by WHAT HAILS PUBLIC SECTOR

TODAY

 Bharat Gaurav Award by India International Friendship Society

 9th Gold Award in Metal & Mining Sector for outstanding achievement

in Environment Management by GREENTECH

 SCOPE Meritorious award for environmental excellence & sustainable

development – Gold Plaque Certificate of Excellence in Corporate

Performance awarded by CIL.

27
28
 PART- B

(INTRODUCTION TO THE

TOPIC)

Ratio Analysis

To analyze the performance of NORTHERN COALFIELDS LIMITED,

different tools are used, of Ratio Analysis. Financial analysis involves the use of

various financial statements. These statements do several things. First the balance

sheet and the second is income statement.

The Balance sheet summarizes the assets, liabilities, and owner’s equity of a

business at a point in time, while the income statement summarizes revenues and

expenses of a firm over a particular period of time. A conceptual framework for

29
financial analysis provides the analyst with an interlocking means for structuring

the analysis.

A financial ratio (or accounting ratio) is a relative magnitude of two selected

numerical values taken from an enterprise's financial statements. Often used in

accounting, there are many standard ratios used to try to evaluate the overall

financial condition of a corporation or other organization. Financial ratios may be

used by managers within a firm, by current and potential shareholders (owners) of

a firm, and by a firm's creditors. Security analysts use financial ratios to compare

the strengths and weaknesses in various companies. If shares in a company are

traded in a financial market, the market price of the shares is used in certain

financial ratios.

Values used in calculating financial ratios are taken from the balance sheet, income

statement, statement of cash flows or (sometimes) the statement of retained earnings.

These comprise the firm's "accounting statements" or financial statements. The

statements' data is based on the accounting method and accounting standards used by

the organization.

Financial ratios quantify many aspects of a business and are an integral part of

financial statement analysis. Financial ratios are categorized according to the

financial aspect of the business which the ratio measures. Liquidity ratios measure

the availability of cash to pay debt. Activity ratios measure how quickly a firm

converts non-cash assets to cash assets. Debt ratios measure the firm's ability to

repay long-term debt.Profitability ratios measure the firm's use of its assets and

control of its expenses to generate an acceptable rate of return. Market ratios

30
measure investor response to owning a company's stock and also the cost of

issuing stock.

Financial ratios allow for comparisons

• between companies

• between industries

• between different time periods for one company

• between a single company and its industry average

Ratios generally hold no meaning unless they are benchmarked against something

else, like past performance or another company. Thus, the ratios of firms in different

industries, which face different risks, capital requirements, and competition are

usually hard to compare.

31
 Ratio analysis is the comparison of line items in the Finanacial Statements of a

business. Ratio analysis is used to evaluate a number of issues with an entity,

such as its liquidity, efficiency of operations, and profitability. This type of

analysis is particularly useful to analysts outside of a business, since their

primary source of information about an organization is its financial statements.

Ratio analysis is less useful to corporate insiders, who have better access to more

detailed operational information about the organization. Ratio analysis is

particularly useful when used in the following :

 Industry comparison. Calculate the same ratios for competitors in the same

industry, and compare the results across all of the companies reviewed. Since

these businesses likely operate with similar fixed asset investments and have

similar capital structures, the results of a ratio analysis should be similar. If this is

not the case, it can indicate a potential issue, or the reverse - the ability of a

business to generate a profit that is notably higher than the rest of the industry.

32
 The industry comparison approach is used for sector analysis, to determine which

businesses within an industry are the most (and least) valuable.

There are several hundred possible ratios that can be used for analysis purposes,

but only a small core group is typically used to gain an understanding of an

entity. These ratios include:

 Current Ratio : Compares current assets to current liabilities, to see if a

business has enough cash to pay its immediate liabilities.

 Days Sales Outstanding: Determines the ability of a business to effectively

issue credit to customers and be paid back on a timely basis.

 Debt to Equity Ratio : Compares the proportion of debt to equity, to see if

a business has taken on too much debt.

 Dividend Payout Ratio: This is the percentage of earnings paid to investors

in the form of dividends. If the percentage is low, it is an indicator that there is

room for dividend payments to increase substantially.

 Gross Profit Ratio: Calculates the proportion of earnings generated by the

sale of goods or services, before administrative expenses are included. A decline

in this percentage could signal pricing pressure on a company's core operations.

 Inventory Turnover: Calculates the time it takes to sell off inventory. A

low turnover figure indicates that a business has an excessive investment in

inventory, and therefore is at risk of having obsolete inventory.

 Net Profit Ratio: Calculates the proportion of net profit to sales; a low

proportion can indicate a bloated cost structure or pricing pressure.

33
 Price Earning Ratio: Compares the price paid for a company's shares to the

earnings reported by the business. An excessively high ratio signals that there is

no basis for a high stock price, which could presage a stock price decline.

 Return on Assets: Calculates the ability of management to efficiently use

assets to generate profits. A low return indicates a bloated investment in assets.

34
 CHAPTER -8

(LITERATURE REVIEW)

35
 LITERATURE REVIEW

Raizada,(2012) The coal-mining enterprises must improve their own competitiveness

to adapt to the globally changing business scenario. Therefore, it is key issue to

establish a personalized, characteristics brand for the coal-mining enterprises

participating in market competition. Coal brand products have become a

comprehensive reflect to the scientific and technological level, management level,

marketing level and corporate culture of coal-mining enterprises. Despite it is difficult

to build up a good brand image in minds of customer as a result of the characteristics

of high homogeneity and alternative-not of coal products, the coal companies still

take advantage of setting brand strategy to establish a differential advantages and

reduce the sensitivity of the price from users, because the coal as a natural mineral, its

region, depth, the formation age are different. Once the coal companies become

famous by their brands, it is easy to make product or service well known, and form a

certain competitive advantage, then increase the visibility of enterprises, finally the

coal companies’ strong market emissive and advantage in pillar industries can boost

the development of relevant industries. A successful industrial brand is developed

when a firm keeps its commitment on quality, deliveries and services to its customers.

Such brands are able to withstand the competition with ease and command premium

prices .

NAN Yuan Zheng,(2006) A competitive price discovery process empowers

companies to follow their own judgements of market conditions and results in the fair

pricing of products .Once the coal companies become famous by their brands, it is

easy to make product or service well known, and form a certain competitive

36
advantage, then increase the visibility of enterprises, finally the coal companies’

strong market emissive and advantage in pillar industries can boost the development

of relevant industries .One category of industrial product is coal which is used as a

raw material in other industries. In an industrial buying process, the buyers evaluate

the suppliers on the basis of various key parameters. These are:

(1) Performance of the product;

(2) Price and its impact on the final costing of the buyer

(3) Reliability of suppliers in terms of after sales service..

Dhar and Hoch, (1997).Areas of price increase may be considered once quality

improves because consumer price sensitivity matters less for high-quality brands

.CSR activities has been an important factor under consideration as there is a

socioeconomic view of social responsibility, argued by theorists like Freeman (1984),

Clarkson (1995), Lazer (1996)who believe that businesses owe something back to the

society that supports them, and that this debt is greater than the debt of any individual

member of the society. This is a broad view of CSR which states that companies are

responsible to the society as a whole, of which, they form an integral part. They

operate by public consent and therefore should constructively serve the needs of the

society. This approach is illustrated by the concepts of corporate accountability and

social justice .

Williamson, (1990).The coal products of coal-mining enterprises are non-renewable

natural resources, they are influenced by geological storage conditions due to which

the quality and yield has a big fluctuation. In addition, the planned economy restricts

the development of coal-mining enterprises by the deep-rooted ideology that

37
emphasized production, lighten the sales and the brand strategy has been neglected all

the times. In the oversupply environment of coal market, most businesses take only

low-level tactical adjustment and adaptation, have yet to form a future-oriented

system of management and marketing strategies, thus leading to the coal products

become backlog, the price inversion, and the arrears are difficult to made up, the

entire coal market is in the disorder condition of low-price dumping.

Carroll (1999) Most of the industrial marketers rely on their established corporate

group image to position their products rather than going for branding it separately.

However, as the demand grows and firms aspire to grow beyond existing markets,

they need to develop a branding strategy to create a distinct identity as well as to

command a better price for their products .

John T Grady ( 2010), financial analysis is the cornerstone of credit risk assessment.

Commercial lenders and analysts study financial statements and perform ratio

analysis to identify and understand the risks in lending to a business. The business's

debt service coverage ratio (DSCR) is one of the key ratios to calculate and analyze as

a measure of the borrower's ability to repay debt. The DSCR measure used by many

bankers is the traditional debt service coverage ratio (TDSCR). A second, more

detailed method to calculate DSCR is to use the information reported in the

borrower's UCA cash flow statement (UCACFS). The purpose of this article is to

apply these two methods for calculating DSCR. It also will highlight the differences

between the two DSCR calculations and show the added benefit that the UCA-based

calculation can bring to the credit analysis. The important point is that when analyzing

a credit and the debt service ability; do not stop at the traditional DSCR.

38
Sam Subramanian (2010), Fundamental equity traders rely on factors such as

earnings, earnings growth or valuation ratios to select securities. Technical traders use

moving averages, trading volume patterns or price breakouts. One method is not

necessarily better than the other; each has its merits. By leveraging the strengths of

both of these styles, people can not only increase their success rate in selecting

securities, but also improve their portfolio management. To understand the nuances of

the two methods, it helps to think of a company and its stock as two separate entities.

This article has demonstrated how technical analysis can be used to supplement the

fundamental assessment of a company. Ultimately, that technical analysis can help to

make trading decisions. These analyses also can be combined when making sale

decisions, as positions are unwound. By spreading buy and sell decisions over wider

periods and price points, investors can seek to earn higher risk-adjusted returns.

Bansal and Gupta (1985) in their study entitled, “Financial Ratio Analysis and

Statistics” enlightened that the coefficient of variation in the study period had a wide

gap varying between 7.1 per cent and 51.3 per cent for current ratio and ratio of fixed

assets to sales. The correlation of components of short term liquidity ratio generally

possesses low correlation as against long term solvency ratio components but the

components of both ratios independently possess quite satisfactory correlation in

cotton textile industry. The profitability ratio elements in the industry also have quite

high correlation in cotton industry as compared to synthetic industry

Gangadhar (1998)10 has made an attempt on “Financial Analysis of Companies in

Criteria: A Profitability and efficiency focus” one of the objectives of the study is to

analyze the liquidity position of the companies and to point out the factors responsible

39
for such a position. It is concluded that the liquidity position was quite alarming since

these are facing chronic liquidity problems. Their proportion current assets in relation

to the current liabilities are very low.

It is suggested that, they may be improved by reducing excessive burden of current

liabilities or increasing the level of current assets depending upon the requirements.

Feroz & et al. (2003) Ratio analysis is a commonly used analytical tool for verifying

the performance of a firm. While ratios are easy to compute, which in part explains

their wide appeal, their interpretation is problematic, especially when two or more

ratios provide conflicting signals. Indeed, ratio analysis is often criticized on the

grounds of subjectivity that is the analyst must pick and choose ratios in order to

assess the overall performance of a firm. In this paper they demonstrate that Data

Envelopment Analysis (DEA) can augment the traditional ratio analysis. DEA can

provide a consistent and reliable measure of managerial or operational efficiency of a

firm. They test the null hypothesis that there is no relationship between DEA and

traditional accounting ratios as measures of performance of a firm. Their results reject

the null hypothesis indicating that DEA can provide information to analysts that is

additional to that provided by traditional ratio analysis. They also apply DEA to the

oil and gas industry to demonstrate.

Amir Hossein Jamali and Asghar Asadi (2012) in their study investigated the

relationship between the management efficiency and the firms profitability for a

sample of thirteen auto manufacturing companies listed on the Bombay Stock

Exchange. The analysis is carried out using Minitab 14 and conducting Pearson

Coefficient correlation test on variables of the study including Gross Profit Ratio and

40
Assets Turnover Ratio. The central conclusion of the study is that profitability and

management efficiency are highly correlated to each other and based on the results of

the study recommendations for improving the management efficiency and

profitability in this industry are suggested.

Hari Govinda Rao & et al. (2013) in their study entitled “An Empirical Analysis on

Financial Performance of Public Sector Housing Corporation in India: A Case Study

of HUDCO”, stated that the main concept of their study is Profitability and liquidity

management is of crucial importance in financial

management decision. The most favourable financial performance could be achieved

by a company that can trade off between profitability and liquidity performance

indicators. The purpose of this study is to find out the financial position of and know

the significance of them. Descriptive statistics discloses that performance of the

selected unit in terms of liquidity, solvency and profitability position is very

satisfactory and relatively efficient financial position is found in 36

all the cases. They suggested that both the institutions under the study should

concentrate on financial profitability, especially unexplained variables in purpose of

creating shareholders‟ wealth.

Bollen (1999) conducted a study on Ratio Variables on which he found three different

uses of ratio variables in aggregate data analysis: (1) as measures of theoretical

concepts, (2) as a means to control an extraneous factor, and (3) as a correction for

heteroscedasticity. In the use of ratios as indices of concepts, a problem can arise if it

is regressed on other indices or variables that contain a common component. For

example, the relationship between two per capita measures may be confounded with

41
the common population component in each variable. Regarding the second use of

ratios, only under exceptional conditions will ratio variables be a suitable means of

controlling an extraneous factor. Finally, the use of ratios to correct for

heteroscedasticity is also often misused. Only under special conditions will the

common form forgers soon with ratio variables correct for heteroscedasticity.

Alternatives to ratios for each of these cases are discussed and evaluated.

Cooper (2000) conducted a study on Financial Intermediation on which he observed

that the quantitative behavior of business-cycle models in which the intermediation

process acts either as a source of fluctuations or as a propagator of real shocks. In

neither case do we find convincing evidence that the intermediation process is an

important element of aggregate fluctuations. For an economy driven by

intermediation shocks, consumption is not smoother than output, investment is

negatively correlated with output, variations in the capital stock are quite large, and

interest rates are procyclical. The model economy thus fails to match unconditional

moments for the U.S. economy. We also structurally estimate parameters of a model

economy in which intermediation and productivity shocks are present, allowing for

the intermediation process to propagate the real shock. The unconditional correlations

are closer to those observed only when the intermediation shock is relatively

unimportant.

Gerrard (2001) conducted a study on The Financial Performance on which he found

that Using ratio analysis the financial performance of a sample of independent single-

plant engineering firms in Leeds is examined with regard to structural and locational

differences in establishments. A number of determinants of performance are derived

42
and tested against the constructed data base. Inner-city engineering firms perform

relatively less well on all indicators of performance compared with outer-city firms.

The study illustrates the importance of using different measures of performance since

this affects the magnitude and significance of the results. Financial support is

necessary to sustain engineering in the inner city in the long run.

Schmidgall (2003) conducted a study on Financial Analysis Using the Statement of

Cash Flows on which he observed that Managers use many financial ratios to judge

the health of their businesses. With the recent requirement of a statement of cash flow

(SCF) by the Financial Accounting Standards Board, managers now have a new set of

ratios that will give a realistic picture of the business. The ratios include cash flow-

interest coverage, cash flow-dividend coverage, and cash flow from operations to cash

flow in investments. These ratios are particularly useful because they show changes in

a hotel or restaurant's cash position over time, rather than at a given moment, as is the

case with many other ratios.

Murinde (2003) ) conducted study on Corporate Financial Structures on which he

observed that the financial structure of a sample of Indian non-financial companies

using a new and unique dataset consisting of a panel containing the published

accounts of almost 900 companies that published a full set of accounts every year

during 1989-99. In a new departure in the literature, the dataset includes quoted and

unquoted companies. We compare the sources-uses approach to analyzing company

financial structures with the asset-liability approach. We use both approaches to

characterize and to compare the financial structures of Indian companies over time;

between quoted and unquoted companies; and between companies which belong to a

43
business group and those that do not. Finally, we compare our results to those

obtained previously for India and for the industrial countries.

McMahon (2005) conducted a study on Financial Information on which he found that

financial statements mean little to the uninitiated. This paper, explains, in layman's

terms, how to understand financial information. It covers measures of profitability.

The second article will cover measures of company liquidity and the use of financial

ratios. This paper continues to explain how to interpret and understand financial

information. It deals with measures of liquidity, solvency and fund flows and

describes how to establish standards against which a company's financial ratios can be

compared.

Lee (2008) conducted a study on Financial Risk on which he observed that Financial

researchers, including those concentrating on the lodging industry, use various

financial risk measures for their studies. Examples of those risk measures are beta,

earnings variability, bankruptcy probability, debt-to-equity ratio and book-to-market

ratio. The purpose of this study is, first, to descriptively investigate various financial

risk measures used in the lodging financial literature by performing factor analysis

and identifying four distinct risk groups. Second, this study examines the predictive

ability of the four risk groups for lodging firm performance. The findings of this study

suggest that strategic and stock performance risk factors better represent a lodging

firm's financial risk than do bankruptcy and firm performance risk factors, and also,

ROA than ROE better estimates lodging firm performance in terms of their

relationships with financial risk factors.

Johnson (2009) conducted a study on Financial Ratio patterns on which he found that

the properties and characteristics of financial ratios have received considerable

44
attention in recent years with interest primarily focused on determining the predictive

ability of financial ratios and related financial data. Principal areas of investigation

have included the prediction of corporate bond ratings , and the anticipation of

financial impairment]. Related studies have examined the characteristics of merged

firms the differences in financial ratio averages among industries whether firms seek

to adjust their financial ratios toward industry averages the relationship between

accounting-determined and market-determined risk measures, and the influence of

financial ratios on analysts' judgments about impending bankruptcy The general

conclusion to emerge from these various research efforts is that a number of financial

ratios have predictive and descriptive utility when properly employed.

Ooghe & et al. (2006) in their paper examine the financial performance of the

acquiring firm after the acquisition, using statistical analysis of industry- adjusted

variables. Their findings show that following: the acquisition, the profitability, the

solvency and the liquidity of most of the combined companies decline. This decline is

also reflected in the failure prediction scores. With respect to the added value,

acquisitions are found to be accompanied by increases in the labour productivity, but

this is caused by the general improvement of gross added value per employee of

Belgian companies in the last ten years. So, it seems that, contrary to the general

expectations and beliefs, acquisitions usually do not seem to improve the acquirer's

financial performance.

45
 CHAPTER-9

(OBJECTIVES OF THE STUDY)

46
 RESEARCH OBJECTIVES

 To analyze the Financial Performance of NCL, Bina.

 To find out NCL’s ability to meet the current obligation.

 To understand how efficetively NCL utilizes its assets to improve

profitability.

47
 CHAPTER-10

(RESEARCH METHODOLOGY)

48
 RESEARCH METHODLOGY

Research methodology involves specific techniques used to identify, select,

procedures and analyze information about a topic.

a. Research Design: This project is based on ANALYTICAL RESEARCH.

Analytical research is the research in which researcher has to use facts or

information already available and analyze these to make a critical evaluation of the

facts , figures, data or material.

Data requirement : The study is based on secondary data collected from annual

report of company.

b. Sampling procedure: This study is based on secondary data. Data for

analysis has been taken from company’s annual reports financial year..

c. Sample Size: Last two years financial statements use in the project report.

d. Data Collection Method: Annual report and websites

49
 CHAPTER-11

(DATA ANALYSIS &

INTERPRETATION)

50
 CALCULATION & INTERPRETATION OF RATIOS

1.CURRENT RATIO :

Current ratio may be defined as the relationship between current assets and current

liabilities. This ratio is also known as working capital ratio, is measure of general

liquidity and mostly used to make the analysis of a short-term financial position or

liquidity of a firm. The rule of thumb for current Ratio is 2:1 which is considered as

strong financial position of the company.

Current ratio = Current Assets

Current Liabilities

Calculation :

Table No. : 1

Year 2017 (in Cr.) 2018(in Cr.)

Current 129.01 172.39
Assets
Current 328.79 362.13
Liabilities

Ratio 0.39 0.47

INTERPRETATION

In 2017, current ratio was 0.39 which is increased to 0.47 in the year 2018. As

compared to last year Current Assets has increased because of increase in other

current Assets. So, Current Ratio also increased.

51
2. LIQUID RATIO:

Quick ratio is more rigorous test of liquidity than the current ratio. The

term liquidity refers to the ability to pay its short term obligations as and

when they become due. As a rule of thumb quick ratio of 1:1 is

considered satisfactory.

Quick Ratio = Quick/ liquid Assets

Current liabilities
Calculation :

Table No. : 1.2

Year 2017(in Cr.) 2018(in Cr.)

Quick 81.09 70.08
Assets
Current 328.79 362.13
Liabilities

Quick ratio 0.24 0.19

INTERPRETATION:

In 2017, quick ratio was 0.24 which has decreased to 0.19 in 2018. Quick assets

has decreased by 13.5% and Current liabilities has increased only by 10.14%. Due

to which quick ratio has decreased by 20.83%. The management has to take a

great effort in maintaining high quick assets in next year.

52
3. DEBTOR TURNOVER RATIO:

A concern may sell goods on cash as well as on credit. The volume of

sales can be increased by adopting liberal credit policy. But liberal credit

policy may result in tying up substantial funds of a firm in form of trade

debtors. Trade debtors are expected to be converted into cash within short

period and are included in current assets.

Debtors velocity indicates the number of times the debtors are turned over

during a year. Higher the value of debtor turnover the more efficient is the

management of debtors/sales and vice versa

Formula = Debtor turnover ratio = Net credit sales

Average debtors

Calculation :

Table No.: 1.2

Year 2017(in Cr.) 2018(in Cr.)

Sales 1282.05 1039.54

Debtor 5.43 5.89

Ratio 236 Times 176 Times

Interpretation:

Debtor turn over ratio in the year 2017 is extremely high i.e 236 times . The ratio is

too high because the entire sale done by the project is according to the agreement with

53
customer. The debtor shown on the closing day of financial year is not received by the

customer because customer has time to pay his liability in near future. So the project

is not worried about the Bad debts.

54
4.GROSS PROFIT RATIO:

The gross profit ratio indicates the extent to which selling prices of goods per unit

may decline without resulting in losses on operations of a firm. It reflects the

efficiency with which a firm produces its products. Gross profit should be adequate to

cover the operating expenses and to provide for fixed charges, dividends and

accumulation of reserves.

Gross profit ratio = Gross profit * 100

Net Sales

Gross Profit = Sales- Cost of goods sold

Calculation :
Table No.:1.3

Year 2017(in Cr.) 2018(in Cr.)

Gross profit 1348.19 1073.16

Net sales 1282.05 1039.54

Ratio 105% 103 %

INTERPRETATION

In the year 2017 gross profit ratio was 105 % which decreased to 103% in

the year 2018. The project gross profit has decreased with decrease in

sales as compared to last year. The project gross profit ratio has decreased

by 2% due to increase in direct expenses. The company has sound

55
position to meet its non-operating expenses and also enough capable to

pay taxes and royalty to the government.

56
5. OPERATING RATIO:

Operating ratio establishes the relationship between cost of goods sold and other

operating expenses on the one hand and sales on the other hand. Operating ratio

indicates the percentage of net sales that is consumed by operating cost. Higher the

operating ratio is less favourable for the company because it would have small margin

to cover interest, income tax , dividend and reserve.

Operating ratio = Operating Cost*100

Net Sales
.

Calculation :

Table No.:1.4

YEAR 2017(in Cr.) 2018(in Cr.)

Operating Cost 223.01 222.76

Net Sales 1282.05 1039.54

Ratio 17.39% 21.4%

INTERPRETATION

In the year 2017, operating ratio was 17.39% which increased to 21.4% in the year

2018. Increased in operating ratio will leads to decrease in net profit.

57
6. NET PROFIT RATIO

Net profit ratio establishes a relationship between net profit after tax and sales and

indicate the efficiency of the management in controlling the expenses of the company.

Net profit ratio = Net profit after tax *100

Net sales

Calculation :

Table No.: 1.5

Year 2017(in Cr.) 2018(in Cr.)

Net profit 222.78 103.59

Net sales 1282.05 1039.54

Ratio 17.37% 9.96%

INTERPRETATION:

The net profit of the company has decreased by 46% as compared to last

year. In 2017 project net profit was 17.37% which decreased to 9.96% in

2018. Net profit of the project has been decreased due to decrease in sales/

production. The net profit of the project reveals sound business of the

project and strong financial position.

58
 FINDINGS

 Current ratio is showing an increasing trend , which implies that current

assets are high compared to current liabilities. And it is a sign that company
is sufficiently liquid and can easily pay off its short term debt.
 It is considered that increasing debtors turnover ratio is good for a healthy
company but NCL had a very fluctuating DTR (Debtors turnover ratio) and
it went low by last years this results in increasing the average collection
period of the company..
 Quick ratio is also low as compared to lasr year. Therefore, management has
to take necessary initiative to maintain that.
 Debtor’s turnover ratio decreases from 2017 to 2018 which is not beneficial
for the company.
 The net profit of the project reveals sound business of the project and strong
financial position which also decreased from last year.

 During the study, it was found that their is no huge variation in budget
decided and the actual one.

59
 CONCLUSION

Ratio analysis helps to know the financial position of the company and it also helps to
analysis the liquidity position of the company. By this study it is analyzed that the
liquidity position of the company is satisfactory. Company is able to pay off its short
term debt by using its short term assets. Also it is analyzed that company’s profit
position and debtors collection position is not satisfactory company needs to improve
it.

Ratio analysis helps the financial statements to reflect how far the company is able to
achieve its objectives. And it also helps to know the past and present financial
performance of the company. By Analysis of Company 2 year’s data it is conclude
that company liquidity position is satisfactory i.e. company have enough current
assets.

60
 RECOMMENDATIONS

 It can be said that the overall financial position of the company is satisfactory.

 The company need to improve its Profit through their sales/productions.

 The tendering process time is to be minimized so that the current market price

benefits if any can be availed

 During my internship it was observed that there was no proper distribution of

work in the organization. So in this case the organization would not be able to

utilize their energy. So their should be proper distribution of work.

61
 LIMITATIONS OF STUDY

 Availability of the financial data was very limited which is not disclosed due

to sensitive nature for the company

 Less response by some of the staff members

.
 Two months period for understanding all the working procedure of any

particular organization is not sufficient.

 External environment influence was not considered while doing the theoretical

standard rather than the industrial standard because of unavailability of any

such specific standard.

 The scope of the study was limited to NORTHERN COALFIELDS

LIMITED, BINA.

62
 BIBLOGRAPHY

ANNUAL REPORT. NORTHERN COALFIELDS LTD.

Anubhuti Ranjan Prasad, Coal nIndustry of India, 1986

Ashish Publishing House.

Ajoy K Ghose, Mining, Challenges of the 21st century, 2000 International

Energy Agency Coal in the energy supply of India,2002

Chandra, P. FINANCIAL MANAGEMENT.

C.R. Kothari, Research methodology-methods and techniques, New Age

International Publishers, New Delhi 1985, second edition

Dalayeen, (2017). Ratio analysis and profitability. journal of applied finance and

banking .

Pimplapure, & Kulkarni, (2011). Impact of profitability. SCMS JOURNAL OF

INDIAN MANAGEMENT

Singhania, M.Sharma, & Rohit, (2014). Working capital management and

profitability. indian institute of management calcutta ,

Titto Varghese, K. K. (2014). IMPACT OF WORKING CAPITAL MANAGEMENT

ON FIRM PROFITABILITY. international journal of financial management .

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WEBSITES:

http://www.coalindia.nic.in

http://www.ncl.nic.in

http://www.scribd.in

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