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AN ORGANIZATION STUDY
AT
Aditya Birla Finance
Bangalore
Submitted in partial fulfillment of the requirement of the
Bangalore University for the forward of degree in
Master of Business Administration
Submitted by
PADMINI M S
REG NO: 10XQCMA067
Under the Guidance of
DR. NAGESH MALLAVALLI
M. P Birla Institute of Management
Associates of Bharatiya Vidya Bhavan
No.43, Race Course Road
Bangalore 1
DECLARATION
I, Padmini M S (Reg. No. 10XQCMA067) hereby declare that the internship report, an
Organizational study conducted at Aditya Birla Finance Corporate Office Bangalore submitted in
partial fulfillment of the requirements of the Bangalore University for the award of degree in Master
of Business Administration is a bona fide work carried out by me under the guidance of Dr. Nagesh
Mallavalli, MPBIM, Bangalore.
This report has not been submitted earlier to any university or institution for the award of any
degree/diploma.
The content of this report are based on the data collected by me at Aditya Birla Finance,
Bangalore under the guidance of Arun Bhat Relationship Manager.
Place:
Date:
Padmini.M.S
Reg. No. 10XQCMA067
ACKNOWLEDGEMENT
This project is a product of the invaluable insights, facts and experience I had with the
industry people. The learning experience was more than what was visualized as.
I would like to express my sincere gratitude to Mr. Arun Bhat Relationship Manager of
Aditya Birla Finance for giving me the opportunity to be a part of the Capital Market
department.
I would like to express my sincere thanks to Mr. Rakesh Singh my project guide in Aditya
Birla Finance for extending his Support in making my internship a knowledgeable
experience.
I would also like to thank all those who have directly and indirectly helped me in completion
of the project.
I would also like to thank my project guide Dr. Nagesh Mallavalli, who guided me through
the entire project.
I am indebted to my parents. They have been my guiding light in my passage of this mortal
world.
Above all I would like to thank all my friends and also my college who have helped me in
completing this project.
Padmini M S
CONTENTS
Sl no Index Pg no
Executive Summary 1
1 Introduction 2
1.1 Background of the study 4
1.2 Industry Profile 5
1.3 Company Profile 8
1.4 Corporate Social Responsibility 10
1.5 Vision, Mission and Value 14
2 Organizational Structure 15
2.1 Corporate Organizational Structure 16
2.2 Departmental Organizational Structure 16
2.3 Authority and Responsibility relationship 17
3 Functional Areas 22
3.1 HR Department 23
3.2 Capital Market Department 23
3.3 Corporate Finance Department 23
3.4 Risk Management Group 24
3.5 Mid Office Group 24
3.6 Finance 24
3.7 Information Technology 24
4 SWOT Analysis 38
4.1 Strengths and Weakness 39
4.2 Opportunities and Threats 41
5 Observation, Suggestions and Conclusions 42
5.1 Suggestions 42
Annexure 58
Bibliography 65
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 1
Executive Summary
Aditya Birla Finance Ltd. (ABFL), formerly known as Birla Global Finance, is one of
India's leading non-banking financial companies. The company is also such an entity
consisting of people with rich and varied skills, experience and areas of expertise
working together harmoniously to deliver quality outputs.
The organization study helps to understand and make factual observation about the
functioning of an organization. The organization study helps to have the firsthand feel
of the corporate environment.
Organization study helps to know about the following:
Learn about the working environment
To understand the organization hierarchy
To know the functions and activities of various employees
To get an insight about the vision, mission values, etc. of the organization.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 2
Chapter 1
INTRODUCTION
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 3
1. INTRODUCTION
The Aditya Birla Financial Services Group (ABFSG) has built a significant presence
across its verticals, viz. life insurance, asset management, NBFC, private equity,
broking, wealth management & distribution and general insurance advisory services
The seven companies representing Aditya Birla Financial Services Group are Birla
Sun Life Insurance Company Ltd., Birla Sun Life Asset Management Company Ltd.,
Aditya Birla Finance Ltd., Aditya Birla Capital Advisors Pvt. Ltd., Aditya Birla
Money Ltd., Aditya Birla Money Mart Ltd, and Aditya Birla Insurance Brokers Ltd.
ABFSG is committed to being a leader and role model in a broad based and integrated
financial services business. Its 7 lines of businesses, with about 5.5 million customers
manages assets worth USD 18 billion approximately and prides itself for having a
talent pool of about 15,000 committed employees. ABFSG has its wings spread across
more than 500 cities in India through over 1600 points of presence and about 200,000
channel partners. This allows ABFSG to offer its customers virtually anything under
financial services except a savings or current account. With revenue of over USD 1.25
billion (in 2009-2010) ABFSG is a significant non bank player.
ABFSG is a part of Aditya Birla Nuvo Ltd (ABNL), a USD 3.5 billion conglomerate
having leadership position across its manufacturing as well as services sector
businesses. ABNL is a part of the Aditya Birla Group, a USD 30 billion Indian
business house operating in 27 countries across the globe.
Aditya Birla Finance Ltd. (ABFL), formerly known as Birla Global Finance, is one of
India's leading non-banking financial companies (NBFCs). Incorporated in 1991, the
company has been rated as A1+ by ICRA, for its short-term borrowings, which
indicates highest-credit-quality
ABFL offers specialized solutions in areas of Capital Markets, Corporate Finance and
Project Finance. It is one of the largest players in security based lending and the
pioneer of IPO Financing in India.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 4
1.1 BACKGROUND OF THE STUDY
This report is the result of 5 weeks of internship program at Aditya Birla Finance.
During this internship it was required to study the organization, working of the
various departments, creation of broker and client database and fixing up client
meetings.
The motive behind considering Aditya Birla Finance as the organization for study was
to have a thorough understanding of the Finance sector.
The finance sector of this company is into Secured loans and Unsecured Loans,
Aditya Birla has built a strong brand recognition and have established themselves as a
strong brand in this sector.
OBJECTIVE OF THE STUDY
To analyse how the various functional departments work.
Have a balance between the theoretical and practical world of the organisation.
Perform SWOT analysis and understand the core competencies of the
organisation.
To understand Capital Market and Corporate finance, procedures
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 5
1.2 INDUSTRY PROFILE
Finance Companies of India
The top finance companies are playing a key role in the huge growth of the
economy of India. The sector of finance is passing through a rapid phase of
alteration. The sustenance of the growth of economy is the primary factor for the
development of the India's financial sector.
List of Top Finance Companies of India
SBI Capital Markets Limited
It is one among the oldest organizations in the capital markets sector of India. It was
established in the year 1986 as an ancillary of SBI. It ranks second in Asia's Project
Advisory services. The company is a trailblazer in privatization and securitization.
The company’s subsidiaries are SBICAPs Ventures Ltd., SBICAP Trustee Co.Ltd.
And many others.
Bajaj Capital Limited
The company offers best investment advisory and financial planning. It provides
institutional investors, NRIs, corporate houses, individual investors , high network
clients with investment advisory and financial planning services. It is also the
largest provider of finance products offered by public and private organizations,
several government bodies, investment products like bonds, mutual funds, general
insurance etc.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 6
DSP Meriyll Lynch Limited
It is the key player of equity and debt securities in India. It renders financial advises
to many corporations and institutions. It also offers a wide array of wealth
management and investor services along with customized advices related to
financial matters. This company is the pioneer to form research facility to research
in financial products and services, improvements and innovations. The company
also has its hand in the Government securities and holds an eminent position in the
market of equity and debt in India.
Birla Global Finance Limited
It is a subsidiary of Aditya Birla Nuvo Ltd. Their motto is to be the first choice of
the customers as a major provider of financial services through technology and
value creation. The primary activities of the company are Corporate Finance and
Capital Market. Aditya Birla Nuvo has also formed alliance with Sun Life Financial
of Canada which has given rise to the following financial services companies like
Birla Sun Life Insurance Co Ltd., Birla Sun Life Distribution Co. and many others.
Housing Development Finance Corporation
This company offers the best financial solutions and guidance for home loans,
property related services, loans for NRIs etc. in India. The one stop destination for
comprehensive information on personal finance is HDFC. The company has a wide
network in India and abroad. HDFC overseas offices are in Singapore, Kuwait,
Qatar, Saudi Arabia and many others.
PNB Housing Finance Limited
This is completely owned by PNB and offers premium solutions to relieve the
borrowers. This subsidiary of the PNB has recorded a growth a 73% and is a
leading finance company of India. The Home Loan Life Insurance Plan of this
company in association with TATA AIG offers the lowest premium in compare to
others. The chart for loans of 5 lacks and tenure of 15 years is just premium. It
renders other services like Deposit schemes, Loan schemes and many others.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 7
ICICI Group
ICICI offers a wide spectrum of financial products and services in India. The
company provides solutions for all needs like Instant Banking, Online Trading,
Insta Insure, ICICI Bank immobile etc. The company keeps up the financial profile
healthy and diversifies earnings across geographies and businesses. The company's
philosophy is to deliver high class financial services for all the cross sections of the
society. Their products are Mutual Fund, Private Equity Practice, Securities, Life
Insurance etc.
LIC Finance Limited
It is the leading player in the finance sector of India being the biggest Housing
Finance Company of India. The function of the company is to provide finance to
individuals for repair or construction or renovation of the old or new apartment or
house. It also offers finance on the existing property for personal or business
matters. The company has 14 back offices, 6 regional offices and 126 units of
marketing in India.
L & T Finance Limited
This company was established in the year 1994 by the Larsen and Turbo group and
now it is a significant name in the financial sector. The company offers schemes
like funds for automobiles, funds for Agricultural Instruments, secured loans, funds
for automobiles and many others. It offers loans for a long tenure and the loans are
given in exchange of valuable items.
Karvy Group
The company has about 575 offices in 375 destinations in India. It offers services
like the Mutual Funds Services, Depository Services, Debt Market Services,
Investment Banking and many others.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 8
1.3 COMPANY PROFILE
A US$ 35 billion corporation, the Aditya Birla Group is in the League of Fortune 500.
It is anchored by an extraordinary force of 133,000 employees, belonging to 42
different nationalities. In the year 2009, the Group was ranked among the top six great
places for leaders in the Asia-Pacific region, in a study conducted by Hewitt
Associates, RBL Group and Fortune magazine. In India, the Group has been adjudged
the best employer in India and among the top 20 in Asia by the Hewitt-Economic
Times and Wall Street Journal Study 2007.
Over 60 per cent of the Group's revenues flow from its overseas operations. The
Group operates in 33 countries – Australia, Austria, Bahrain, Bangladesh, Brazil,
Canada, China, Egypt, France, Germany, Hungary, India, Indonesia, Italy, Japan,
Korea, Laos, Luxembourg, Malaysia, Myanmar, Philippines, Poland, Singapore,
Spain, Sri Lanka, Sweden, Switzerland, Tanzania, Thailand, UAE, UK, USA and
Vietnam.
Globally, the Aditya Birla Group is:
:: A metals powerhouse, among the world's most cost-efficient aluminium and
copper producers. Hindalco-Novelis is the largest aluminium rolling company. It
is one of the biggest producer of primary aluminium in Asia, with the largest
single location copper smelter
:: The largest producer of viscose staple fibre
:: The fourth-largest producer of insulators
:: The No.1 producer of carbon black
:: The fifth-largest producer of acrylic fiber
:: The seventh-largest cement producer
:: Among the best energy-efficient fertilizer plants
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 9
In India:
:: Largest cement player in India
:: The top fashion (branded apparel) and lifestyle player
:: The second-largest producer of viscose filament yarn
:: The largest producer in the chlor-alkali sector
:: Among the top three mobile telecom players
:: Among top 10 BPO companies
:: A leading player in life insurance and asset management
:: Among the top two supermarket chains in India
Rock solid in fundamentals, the Aditya Birla Group nurtures a culture where success
does not come in the way of the need to keep learning afresh, to keep experimenting.
Beyond business
Transcending business for over 50 years now, the Group has been and continues to be
involved in meaningful welfare-driven initiatives that distinctly impact the quality of
life of the weaker sections of society in India, South-East Asia and Egypt.
In India, the Group's social projects span 3,000 villages. It reaches out to seven
million people annually through the Aditya Birla Centre for Community Initiatives
and Rural Development, spearheaded by Mrs. Rajashree Birla. Its focus is healthcare,
education, sustainable livelihood, infrastructure and espousing social causes.
The Group runs 42 schools, which provide quality education to over 45,000 children
in India's interiors. Of these, over 18,000 children receive free education. An
additional 8,500 students receive merit scholarships. Likewise at its 18 hospitals in
India, 500,000 patients are given extremely subsidized medical care. To embed
corporate social responsibility as a way of life in organizations, the Group has set up
the FICCI – Aditya Birla CSR Centre for Excellence, in Delhi.
The Group transcends the conventional barriers of business and reaches out to the
marginalized because of its conviction of bringing in a more equitable society.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 10
1.4 Corporate Social Responsibility
Corporate social responsibility is an integral part of the Aditya Birla Group's value
systems. Today, the footprint of the Group's social work spans 3,000 villages in India,
reaching out to seven million people annually.
2011
:: Mrs. Rajashree Birla was presented the All India Management Association
(AIMA) Managing India Award 2011 for 'Corporate Citizen of the Year'. The
award was presented by Mr. P. Chidambaram, India’s Union Minister for Home
Affairs.
:: The Government of India has bestowed the Padma Bhushan Award on Mrs.
Rajashree Birla for her exemplary contribution in the area of ‘Social Work’.The
Padma Bhushan is among the highest civilian awards in India and was conferred
on Mrs Birla at a special ceremony on 01 April 2011.
2010
:: Indian Rayon, Veraval (a division of Aditya Birla Nuvo) is awarded The Rajiv
Gandhi Environment Award for Clean Technologies by The Ministry of
Environment and Forests, Government of India.
:: Mrs. Rajashree Birla, Chairperson, Aditya Birla Centre for Community Initiatives
and Rural Development receives 'Hello Hall of Fame' award for 'Exemplary
Philanthropist of the year' from Worldwide Media Goup's 'Hello' celebrity journal.
:: Ultratech's 'Concern for Health' project awarded the Asian Corporate Social
Responsibility Award by the Asian Institute of Management Centre for Corporate
Social Responsibility.
:: Mrs. Rajashree Birla, Chairperson, Aditya Birla Centre for Community Initiatives
and Rural Development, awarded the Global Golden Peacock Life Time
Achievement Award for Community Development for the year 2010 for
"Outstanding Contribution Towards Community Development and Social
Welfare".
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 11
:: Hindalco and Birla White declared winners in the Golden Peacock Awards for
Corporate Social Responsibility 2010 by an eminent international jury, headed by
Justice P.M. Bhagwati, the erstwhile Chief Justice of India.
:: The Aditya Birla Centre for Community Initiatives and Rural Development teams
up with Columbia University's research centre, the Columbia Global Centers'
Earth Institute in Mumbai, to become its principal partner. The Earth Institute's
goal is to help achieve sustainable development primarily by expanding people's
understanding of the earth as one integrated system.
:: Hindalco wins Amity International Business School’s, ‘Amity Corporate
Excellence Award for Corporate Social Responsibility’
2009
:: Grasim's pulp and fibre division wins the highly prestigious Asian CSR Award.
The Asian CSR Awards, Asia's Premier CSR Awards program, is a project of the
Asian Institute of Management, Manila.
:: Rajiv Gandhi Award for Eminence in Social Field, 2009 conferred on Mrs.
Rajashree Birla by Mr. Jyotiraditya Scindia (Union Minister of State, Commerce
& Industry) on 19 August 2009. The award recognises Mrs. Birla's pathbreaking
work among the poor, more so in India's villages, carried out through the Aditya
Birla Centre for Community Initiatives and Rural Development.
:: Vikram Cement and Aditya Cement wins the Federation of Indian Mineral and
Industries' "Social Awareness Award for the year 2008-09".
:: Reader's Digest Pegasus Star Award conferred on Hindalco in recognition of work
that truly exemplifies the highest values of society and corporate leadership for
social responsibility and sustainable development initiatives. Mrs. Rajashree Birla,
who spearheads all the Group's social projects, received this much coveted award
on behalf of Hindalco from Mr. Arun Jaitley, MP, Rajya Sabha, on 21 January
2009 in Delhi.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 12
2008
:: The President of India, Mrs. Pratibha Patil confers the much coveted Rotary
International Polio Eradication Champion Award on Mrs. Rajashree Birla in an
elegant function at the Rashtrapati Bhavan (Delhi), attended by the Chairman,
select Rotarians and WHO officials.
2007
:: The Aditya Birla Group honoured with the India Today Group's Readers Digest
Gold award in recognition of the work that truly exemplifies the highest values of
society as well as those of Reader's Digest. The award was received by Mrs.
Rajashree Birla, Chairperson, Aditya Birla Center for Community Initiatives and
Rural Development, at the Pegasus Corporate Social Responsibility Awards 2007
function.
:: Hindalco awarded the CII - Sorabji Green Business Centre "National Award for
Excellence in Water Management 2007".
2006
:: Hindalco awarded the Greentech Safety Silver Award for its outstanding safety
performance during 2005-06.
2004
:: Grasim, Nagda, receives the FICCI Annual Award 2003-2004 in recognition of
corporate initiaitve in rural development.
:: Aditya Birla Chemicals (India) Limited, Rehla, Jharkhand, receives the
FICCI Annual Award 2003-2004 in recognition of corporate initiative in family
welfare.
:: Indal wins FICCI Award 2002-2003 for 'Corporate Initiative in Rural
Development'.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 13
2003
:: The Group is ranked 16th in India's first ever survey of 'Great places to work in',
published in Business World magazine. The Group's joint venture concern, Birla
Sun Life Insurance, is ranked 9th
in the same study.
:: The Group is ranked 20th in a study on the 'Best Employers in India', conducted
by Hewitt Associates and Business Today.
:: Hindalco receives the Asian CSR Award for its "Rural Poverty Alleviation
Program". The Asian CSR Awards are Asia's premier awards program on
corporate social responsibility.
2002
:: The Group receives The Economic Times' "Corporate Citizen" of the year award.
2000
:: The Group announces its intention to launch a 450 MW 'Green Power Project' in
Karnataka .
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 14
1.5 VISION, MISSION AND VALUE
ADITYA BIRLA
VISION
To be a premium global conglomerate
with a clear focus on each business.
MISSION
To deliver superior value to our customers,
shareholders, employees and
society at large.
VALUE
Integrity
Commitment
Passion
Seamlessness
Speed
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 15
Chapter 2
ORGANIZATIONAL STRUCTURE
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 16
2.1 CORPORATE ORGANIZATION STRUCTURE
2.2 DEPARTMENTAL ORGANIZATIONAL STRUCTURE
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 17
2.3 AUTHORITY AND RESPONSIBILITY RELATIONSHIP
ADITYA BIRLA GROUP
ABN
SECTORS: textiles, chemicals, agribusiness, carbon black, insulators,
telecommunications, financial services, IT-ITeS.
Products: Branded garments, Viscose filament yarn, carbon
black, fertilizers, insulators, textiles, life insurance, asset management,
non-banking financial services, distribution and wealth management,
broking, general insurance advisory and broking, private equity
investment, advisory and management services, cellular services, IT-
ITeS, branded apparel retailing.
Management
Name Designation
B L Shah Director
Devendra Bhandari Company Secretary & Compliance Officer
Sushil Agarwal Chief Financial Officer & Whole Timed Director
Dr. Rakesh Jain Managing Director
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 18
GIL
Sectors: Cement (grey and white), textiles, chemicals
Products:
Management
Cement, viscose staple fiber, rayon grade pulp, ready mix concrete,
chemicals, textiles
Name Designation
Kumar Mangalam Birla Chairman
Ashok Malu Company Secretary And Compliance Officer
Adesh Gupta Whole Director & Chief Financial Officer & Manager
HIL
Sectors: Non-ferrous metals, chemicals, mining, agribusiness
Products: Aluminum, copper, aluminum rolled products (sheet and foil), cans,
primary metal, recycling, caustic soda, aerospace alloys, alumina,
power generation and aluminum smelting
Management
Name Designation
Dr. Kumar Mangalam Birla Chairman
D Bhattacharya Managing Director
Jagdish Khattar Independent Director
Ram Charan Additional (Independent) Director
Anil Malik Asst. Vice-President & Company Secretary
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 19
ULTRA TECH CEMENT LTD
Sectors: Cement (grey and white)
Products:
Management
Cement, ready-mix concrete
Name Designation
Mr. Kumar Mangalam Birla Chairman
O P Puranmalka Whole Time Director
Sanjeeb Chatterjee Company Secretary
ADITYA BIRLA MINACS WORLWIDE LTD
Sectors: IT-ITeS
Products: IT-ITeS
COMES UNDER ABN
ADITYA BIRLA CHEMICALS (INDIA)LTD
Sectors: Chemicals
Products: Caustic soda
Management
Name Designation
Shyam Sundar Gupta Managing Director
Akash Mishra Company Secretary & Compliance Officer
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 20
ABML
Sectors: Financial services
Products: Broking
Management
Name Designation
Mr. S Balaji Company Secretary & Compliance Officer
Sudhakar Ramasubramanian Managaing Director
ADITYA ISPAT LTD
SECTOR & PRODUCT: Iron & Steel/Interm.Products
Management
Name Designation
S B Chachan Chairman
Mr. Alphonsa Domingo Compliance Officer
ADITYA FORGE LTD
SECTOR: Other Industrial Products
Management
Name Designation
Nitin Parekh Chairman & Managing Director
Yogesh S Pujara Compliance Officer
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 21
IDEA CELLULAR LTD.
SECTOR: Telecom Services
Management
Name Designation
Himanshu Kapania Managing Director
Pankaj Kapdeo Company Secretary & Compliance Officer
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 22
Chapter 3
Functional Areas
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 23
3. FUNCTIONAL AREAS
3.1 Human Resource Department
The Human Resources department manages the entire gamut of employee
management activities. This includes recruitments, training & development, change
management, compensation and benefits, employee engagement, performance
management & HR administration. The Admin department ensures the smooth
functioning of the business by maintaining the infrastructural services availability at
all times.
3.2 Capital Market Group
The Capital markets group is engaged in funding short term & medium term liquidity
requirement of its corporate and individual customers against collaterals of shares,
mutual fund units & other marketable securities. The product portfolio encompasses
the entire security based lending space including Loan against shares/bonds/securities
for HNIs & corporate, Promoter funding, Broker funding, IPO funding, ESOP
funding, syndication & cross selling of group financial services products.
3.3 Corporate Finance Group
The Corporate Finance Group (CFG) is engaged in lending business (assets) with its
target marketing being Large / mid corporate and SME’s. The division has suite of
products for meeting its customer’s short term and medium term needs. The product
portfolio includes Bill Discounting / Factoring, Channel Financing, Vendor
Financing, Bill discounting backed by letter of credit (LC)/BG, Term loans & LAP/
LRD .The division also works with the supply side and buy side customers of various
companies in the Aditya Birla ecosystem.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 24
3.4 Risk Management Group (RMG)
The Risk Management group is engaged in formulating credit risk policies for all
ABFL businesses, carries out risk assessment of credit proposals, obtains credit
decisions from Credit Committees, monitors credit exposure and carries out recovery
of over dues.
RMG formulates risk policies in association with Central Risk, ABFSG for overall
risk management in ABFL.
3.5 Middle office group
The Mid Office Group (MOG) function is responsible for managing the post sanction
processes of all business transactions. The key functions are ensuring proper loan
documentation in compliance of approvals and credit policies, safe custody of
documents, activation of loan accounts, collateral management, and transaction
processing and account maintenance. Accuracy and timeliness are of paramount
importance for managing risks pertaining to the function and provide support to Sales
for enhanced client servicing.
3.6 Finance
Finance department deals with various functions such as treasury (including
availability of funds and efficient management of surplus funds), optimizing cost of
funds, accounts & taxation, managing regulatory compliance as per RBI guidelines,
upholding all legal checks and balances to safeguards interests of the company.
3.7 Information Technology
IT implements processes to ensure maintenance and high availability of software
business solutions & technology infrastructure within the organization, and also
drives effective and timely implementation of business solution system projects
within the organization, in line with the IT roadmap.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 25
FINANCE DEPARTMWENT
Capital Market Solutions
The Capital Market Group offers its customers the best opportunity to meet their
liquidity requirements. It provides finance against the security of various investments
in the capital market. Some of the product offerings include:
Promoter Funding
Loan against security of equity shares/ mutual fund units and other marketable
securities
Line of Credit against securities
IPO Funding
ESOP Funding
LASi (Margin Financing)
Promoter Funding
This facility is offered to promoters against their share holding in their respective
company. It enables you, as a promoter of the company, to increase your share
holding or expand and diversify into other areas of business. With specialized value-
ads such as speed of transaction led by disciplined TAT-driven processes and strong
Chinese walls, you can be assured of quality service and utmost confidentiality.
Tenure Up to 365 days
Security
Shares held by promoter & holding
companies in promoter Group
Loan amount Minimum Rs. 1 Crore
Margin 30% & above
Interest rate Competitive
Documentation Standard Loan Documents with PDC l
Custodian charges At Actuals
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 26
Loan Against Shares (LAS)
Your investments in shares and other marketable securities are capable of offering
you much more than just returns. Loan Against Shares enables you to take a loan
against equity shares and other marketable securities such as life insurance policies,
mutual fund units etc. Simply pledge your shares to acquire a loan that will help you
take a financial leap.
So go ahead and extract the maximum out of your existing investments and use them
to fulfill your desired objectives in life.
Tenure
Up to 365 days with an option to
prepay with mutually agreed
repayment notice
Security As per list of approved shares
Loan amount Minimum Rs. 50 Lakhs
Margin 30% & above
Interest rate Competitive
Documentation Standard Loan Documents with
PDC
Custodian charges At Actuals
Benefits of Loan Against Shares
Get instant liquidity
Avail a minimum of Rs. 50 Lakhs
Repayment tenure ranges from 3 months – 12 months
Use this loan to fulfill business or any other financial objectives
You don't have to sell your shares or certificates
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 27
Documents Required
In case of Individual borrower
Request Letter for Loan against Shares / Securities comprising Loan Amount,
Tenure, Securities, Purpose of Loan & Source of Payment
Last 2 years Income Tax Returns and financial statements duly self attested. (latest
financial should be for FY10, if not ready, provisional must be provided)
Latest borrowing details
PAN Card
Address Proof
2 Photographs
In case of Corporate borrower
Request Letter for Loan against Shares / Securities comprising Loan Amount,
Tenure, Securities, Purpose of Loan & Source of Repayment
Certified, updated true copy of MOA duly signed by Director/Company Secretary
Form 32
Latest share holding pattern
Latest borrowing details
Last 2 years audited financials and Income Tax Returns, duly self attested
List of directors with details of their PAN No, DOB, Residence Address with pin
code
KYC Docs of all signatories authorized by Board, duly self attested (PAN card,
address proof etc.)
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 28
Line of Credit Against Securities
In order to enable investors to take care of unscheduled financing needs, we provide
a line of credit against marketable shares and /or mutual fund units. The investors
can avail the disbursement and make the repayment as per their requirements.
Interest will be calculated only for the actual number of days of funds utilized. The
following terms would apply:
Tenure Up to 365 days
Security As per approved list of shares, and
mutual funds
Loan amount Minimum Rs. 1 Crore
Margin 25% and above
Interest rate Competitive
Custodian Charges As Applicable
Documentation Standard Loan Documents with
PDC
Benefits
Liquidity without selling your long term investments
Maximize gains on your existing investments
Take advantage of investment opportunities
Easier and faster processing
Pay interest only for the period of actual funds utilizations
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 29
IPO Financing
This product offers an excellent opportunity to leverage your own funds in primary
markets and thereby increase the allotment quantum manifold. We provide loans for
subscription in the IPOs of equity / equity linked instruments. The investors have to
invest only the margin amount and the balance amount is financed by Aditya Birla
Finance. Our 'exclusive' IPO financing scheme provides a single window clearance
for application, banking and follow up.
Tenure 10-15 days
Loan amount Minimum Rs. 1 Crore
Interest rate Competitive
Margin Case to case basis depending upon
expected allotment of shares
Documentation Standard Loan Documents with
PDC
Custodian Charges As applicable
Benefits
Maximize gains on your existing funds available for investments
Take advantage of investment opportunities
Procure higher allotments in IPO
Easier and faster processing
ESOP Financing
For the years of hard work and dedication you have put in to help your company
reach newer heights, you have been acknowledged with the much deserved ESOPs,
meant only for the chosen few. So don’t let this rewarding opportunity go by. You
have put in your efforts to get the ESOPs. Now it’s time to reap the benefits
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 30
Tenure 2-13 months
Security ESOPs
Loan amount Minimum Rs. 1 Crore
Interest rate Competitive
Margin 25% and above
Documentation Standard Loan Documents with PDC
Custodian Charges At Actuals
Benefits of ESOP Financing
Specialized and Customized Solution for every company and employee
Speedy and hassle-free transfer of shares: We open up the De-mat account on your
behalf to facilitate a quick and seamless transfer of the allotted shares. This means
that you save both your time and energy. Just provide us with the required
documents and we will do the rest.
Flexible Options: You can either hold or sell your ESOPs depending on your
financial goals. In a fluctuating market, this is an advantage as it offers you the
flexibility to average out your earnings. You also have the option of paying
Documents Required
Address Proof (Passport OR Driving License OR Copy of Lease Agreement OR
Landline Telephone Bill OR Electricity Bill)
PAN card
Employee ID
Passport size photographs (signed across)
Form 16 Or ITR returns ( last 2 yrs)
Pay slip or Salary slip (last 2 months)
Cancelled cheque for demat account opening
(All the documents should be self-attested. All signatures should match the PAN
card signature)
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 31
LASi
LASi enables you to invest/leverage/trade in equity shares at a pre-defined margin.
You pay only a part of the total value of purchase with the rest being provided as a
loan. You can choose your own quantity to trade and can avail loan upto 10 times of
your gross annual income on fulfilling a few simple conditions. This financing
solution can be availed for up to 1 year. You can take advantage of the Buy Today
Sell Tomorrow (BTST) facility and maximize value. So go ahead take a step
towards creating wealth.
Tenure Up to 365 days
Security As per list of approved shares
Loan amount Minimum Rs. 2 Lakhs
Margin 25% and above
Interest rate Competitive
Documentation Standard Loan Documents with
PDC
Custodian charges At Actuals
Benefits of LASi
Leverage the power of your portfolio
Use your existing holding to buy more shares
Avail a minimum of Rs. 2 Lakhs
Margin can be paid in cash or in form of pre-approved shares
Interest is charged on the utilized loan amount only
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 32
Documents Required
Income Tax Returns for the past 2 years
Net worth Certificate
PAN Card
Address Proof
Photographs
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 33
Corporate Finance Solutions
The Corporate Finance Group deals with SMEs and large corporate clients and aims
to provide innovative and customized solutions to meet their short term working
capital needs. Its strength lies in structuring complex deals for their clients. The
Corporate Finance group has developed significant domain expertise which is
reflected in its impressive record of no NPAs since inception along with a large,
diversified yet safe portfolio. While continuing to expand its footprint outside the
Aditya Birla Group, it also plans to increase its presence within the Aditya Birla
Group by driving synergies through specialized financing solutions to associated
vendors and customers. Its product offerings include:
Invoice Discounting
Channel Financing
Vendor Financing
Debt Syndication
Invoice Discounting/Bill Discounting
Working capital is one of the essentials for smooth running of your business. Our
constant endeavor is to provide you with innovative solutions designed to meet your
working capital needs.
Our Invoice Discounting facility includes finance against your domestic receivables
by discounting invoices. It helps you to convert your receivables into instant cash
which improves liquidity resulting into healthy and continuous cash flow of your
business.
Benefits
Instant conversion of your receivables into cash
Financing facility without any charge on assets
Provide hassle-free finance
Lower Margin requirements
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 34
Channel Financing
Channel Financing is an innovative product to extend working capital finance to
dealers having business relationships with large companies in India. Through this
product Dealers are able to leverage their relationship with reputed companies in
sourcing low cost funds. It aims to provide integrated financial solutions to the
distribution channels. This may be in the form of either invoice discounting or a bill
discounting line of credit.
The corporate provides services like Stop Supply Letter, Assistance in Recovery &
Resale. Facility can be structured as per the requirements to help the
dealers/franchises.
Benefits
Assure availability of Working Capital finance to their channel partners at lower
cost of credit
Acts as a marketing tool and helps in strengthening their relationship with Channel
Partners
Greater efficiencies in Receivables and Cash Management Process for corporate
Ability to introduce payment discipline with their Channel Partners
Steady and cheaper source of Working Capital financing for Channel Partners
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 35
Increased Sales through higher purchasing power for Channel Partners
Clean facility up to certain limits
Simplicity of documentation and approval procedures
High service and delivery standards compared to current neighborhood Banker /
Moneylender
Channel partners may be able to increase profitability by availing of cash discounts
from Corporate
Vendor Financing
ABFL understands that longstanding relationship with your vendors is an integral
part of your business. Under vendor financing, facilities are made available to
vendors of Large Corporate. These credit facilities would be granted against specific
transactions such as bill discounting or invoice discounting.
Unlike Corporate Bill discounting limit which is a limit to the corporate, this is a
limit to the vendor. Accordingly, limit is outside the banking arrangement of the
Corporate. Our team would also assist vendors in structuring finance against
confirmed purchase orders from their customers.
Benefits
Assured and continuous availability of Working Capital to vendors
Financing facility without any charge on assets
Improves liquidity of the vendors, which increases his ability to supply larger
volumes
Competitive Pricing
Debt Syndication Debt Syndication encompasses funding activities for diverse business requirements
of corporations. We assist corporate to leverage on debt as an instrument to raise
short-term and long-term capital through structured financial products. This could
be for various requirements including expansions, working capital and also for
structuring and syndicating funds for acquisitions.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 36
Short term debt can be raised through:
Commercial Paper and Mibor-linked Paper - Placement of commercial
paper and short-term Mibor-linked papers with Mutual Funds/ Insurance
Companies/ Banks at fixed and floating rate.
Short Term Loans - Structuring and arranging Short Term Loans / FCNR (B)
from Banks for meeting working capital requirements
Inter-Corporate Deposits (ICD) - Private placement of Inter corporate
deposits.
Buyers / Suppliers Credit - Syndicates low cost borrowing for imports and
exports at Libor linked rates from overseas lenders
Working Capital Facilities - Arranges fund-based and non-fund based limits
for clients from Banks
Long term debt can be raised through:
Project Finance / Term Loans for Expansion - Arranges Long-term loans for
setting up new projects from Financial Institutions and Banks
External Commercial Borrowings - Arranges Libor-linked long-term loans
from overseas lenders in the form of ECBs
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 37
Project/ Structured Finance
With a view to capitalize on the opportunities in the infrastructure, core and emerging
sectors, ABFL has expanded its product suite to include project and structured finance
solutions catering primarily to the growing mid-market clients across the country.
Through this initiative, ABFL would not only provide finance but also syndication
and financial services leveraging on its synergies across businesses. The company
hopes to thus contribute to the development of infrastructure facilities of the country
which is a key driver for growth and development
Headquartered in Mumbai, Aditya Birla Finance has a wide network through its
branches and associates across the country.
Through our lending and financing solutions we enable you to pursue ambitious
growth strategies and execute value-creating transactions. Our aim is to open up a
world of opportunities for you and help you achieve your full potential.
Aditya Birla Finance is a part of Aditya Birla Financial Services Group.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 38
Chapter 4
SWOT Analysis
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 39
4. SWOT
STRENGTHS:
Strong brand recognition: Aditya Birla is a successful corporate with
an enviable track record, both in India and overseas which has a caring
corporate citizen with benchmarked governance practices Anchored by 72,000
employees and trusted by 700,000 shareholders. As a result of which Aditya
Birla has built a brand image which is trusted and recognised by people
throughout the world.
Growing international presence: Aditya Birla operates globally in
over 25 different countries like India, USA, UK, Germany, Canada, Brazil,
Switzerland, Portugal, China, Australia etc. Overseas operations contribute
over 25% of Group revenues. Manufacturing across 9 countries in 3
continents.
Superior research and development department: Focus on improving
efficiency and returns by investing in research and development. . The
company aims to be a world-class organization that delivers innovative
solutions, continuously improves core competencies and executes effectively.
The centre is supported by state-of-the-art equipment set in a one-of-a-kind
brand new technology-led environment.
Strong sense of culture in the working environment: At the Aditya
Birla Group, opportunities are abundant, the environment warm and the people
friendly. Minds are constantly in motion researching, innovating and creating
ideas that push as many as 19 industries, forward. Aditya Birla Group
constantly strives to be and do better than the best. Aditya Birla Group
endeavour to create an ambience where people have the tools and the freedom
to deliver their commitments and take great pride in their work. In the fertile
ethos of Aditya Birla Group, they find a career that is personally rewarding
and professionally enriching.
Effective Leadership: In January 2007, we launched LEAD
(Leadership Program for the Experienced), an Aditya Birla Group Leadership
Program to groom exceptional individuals to be the future leaders of the
Aditya Birla Group. LEAD is an intensive six - month, on - the - job training
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 40
program. Individuals with at least four years of pre or post MBA experience
are eligible to apply for LEAD
Aditya Birla has also built a prestigious Client Base e also known for
their customer loyalty, Aditya Birla has achieved technological excellence
over diversified business
WEAKNESSES:
Complexity of operation
Financial innovation has over the last few decades allowed us to share risk more
effectively than before. At the same time, however, it has introduced a large number
of often complex securities, which investors and risk managers have to deal with. We
argue that while complexity is an important concept in financial markets with
bounded rational agents, it is surprisingly hard to find a workable definition of
complexity, posing a challenge for policy proposals that target complex securities.
We highlight three ways in which bounded rational investors can deal with
complexity:
(i) By dividing up difficult problems into smaller sub-problems or by
using separation results,
(ii) By using models, but keeping in mind potential modelling pitfalls,
(iii) Through standardization and commoditization of securities or investor
restrictions. We also point out that, simply increasing the quantity of information
disclosed to investors does not resolve complexity, since in the presence of
bounded rationality it leads to information overload.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 41
OPPORTUNITIES:
Growth of core sector industries: Growth is something for which most companies,
large or small, strive. Small firms want to get big, big firms want to get bigger.
Indeed, companies have to grow
to survive in the market. Aditya Birla group can rapidly integrate with global
economy by targeting the booming construction business in Asia. Aditya Birla
Finance has immense opportunity in growing e-commerce’s business.
THREATS:
Competition persists in all and every field of business. There is always a risk of take
over
Political impact generally is an external factor which cannot be controlled by any
business.
The impact of foreign currency fluctuation and interest rates: For growing companies
that are early in their industry/business development lifecycle, currency management
should be a low-level concern. . As a company and/or its industry matures and
management becomes focused on "optimization" issues, then currency management
will rise in importance as a business factor. Since Aditya Birla is an established firm,
it has to concentrate on optimization and currency management.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 42
Chapter 5
Conclusion and Suggestions
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 43
Conclusion:
This internship is the first major industrial exposure wherein we got an overall view
of the company. We found out about the management hierarchy, basic departments
and the layout which enhanced our managerial knowledge.
Organizational study of this organization has been fruitful.
Further it has also given me an opportunity to learn how each section within a
department functions and also how the corporate office coordinates with the various
divisions. It emphasises the interdependency and cross functionality among various
departments and divisions within the organization.
The study in this organization proved to be a platform for viewing the inputs gained in
the classroom being put into practice. It very well emphasizes the need for the study
of MBA.
Suggestions
• Must concentrate on the untapped market in order to be more competitive
• Aditya Birla Finance must provide training for all the employees on a regular basis
which can improve the performance and achieve higher productivity.
• The head count in each department must be analysed to suit the Organizational
requirement, along with reducing stress for all its employees.
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 44
Annexure
Aditya Birla Money
Balance sheet
------------------- in Rs. Cr. -------------------
Mar '10 Mar '09 Mar '08
12 mths 12 mths 12 mths
Sources Of Funds
Total Share Capital 5.54 5.54 5.54
Equity Share Capital 5.54 5.54 5.54
Share Application Money 0 0 0
Preference Share Capital 0 0 0
Reserves 49.38 39.9 39.56
Revaluation Reserves 0 0 0
Networth 54.92 45.44 45.1
Secured Loans 5 0 40.3
Unsecured Loans 35 5 0.06
Total Debt 40 5 40.36
Total Liabilities 94.92 50.44 85.46
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 45
Mar '10 Mar '09 Mar '08
12 mths 12 mths 12 mths
Application Of Funds
Gross Block 58.85 53.58 46.31
Less: Accum. Depreciation 24.34 18.87 14.28
Net Block 34.51 34.71 32.03
Capital Work in Progress 1.32 0.17 0
Investments 2.01 2.03 2.05
Inventories 0 0 0
Sundry Debtors 81.47 23.91 55.46
Cash and Bank Balance 23.29 13.85 47.09
Total Current Assets 104.76 37.76 102.55
Loans and Advances 32.93 24.92 30.66
Fixed Deposits 53.68 26.87 46.54
Total CA, Loans & Advances 191.37 89.55 179.75
Deferred Credit 0 0 0
Current Liabilities 132.41 74.64 115.24
Provisions 1.86 1.36 13.13
Total CL & Provisions 134.27 76 128.37
Net Current Assets 57.1 13.55 51.38
Miscellaneous Expenses 0 0 0
Total Assets
94.94 50.46 85.46
Contingent Liabilities 12.54 6.54 2.81
Book Value (Rs) 9.91 8.2 81.42
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 46
Profit & Loss account of Aditya Birla Money
------------------- in Rs. Cr. -----------------
Mar '10 Mar '09 Mar '08
Income 12 mths 12 mths 12 mths
Sales Turnover 97.7 67.82 119.59
Excise Duty 0 0 0
Net Sales 97.7 67.82 119.59
Other Income 2.92 2.86 3.22
Stock Adjustments 0 0 0
Total Income 100.62 70.68 122.81
Expenditure
Raw Materials 0 0 0
Power & Fuel Cost 0 0 0
Employee Cost 23.56 17.96 18.88
Other Manufacturing Expenses 0 1.01 0.66
Selling and Admin Expenses 14.47 11.65 14.11
Miscellaneous Expenses 38.78 27.12 40.74
Preoperative Exp Capitalized 0 0 0
Total Expenses 76.81 57.74 74.39
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 47
Mar '10 Mar '09 Mar '08
12 mths 12 mths 12 mths
Operating Profit 20.89 10.08 45.2
PBDIT 23.81 12.94 48.42
Interest 2.61 5.53 8.31
PBDT 21.2 7.41 40.11
Depreciation 5.67 4.73 3.57
Other Written Off 0 0 0
Profit Before Tax 15.53 2.68 36.54
Extra-ordinary items 0 0 -0.55
PBT (Post Extra-ord Items) 15.53 2.68 35.99
Tax 6.05 2.05 14.39
Reported Net Profit 9.48 0.64 22.14
Total Value Addition 76.81 57.74 74.39
Preference Dividend 0 0 0
Equity Dividend 0 0 4.43
Corporate Dividend Tax 0 0 0.75
Per share data (annualized)
Shares in issue (Lakhs) 554 554 55.4
Earnings Per Share (Rs) 1.71 0.11 39.96
Equity Dividend (%) 0 0 80
Book Value (Rs) 9.91 8.2 81.42
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 48
Ratios
Key Financial Ratios
------------------- in Rs. Cr. -------------------
Mar '10 Mar '09 Mar '08
Investment Valuation Ratios
Face Value 1 1 10
Dividend Per Share -- -- 8
Operating Profit Per Share (Rs) 3.77 1.82 81.59
Net Operating Profit Per Share (Rs) 17.64 12.24 215.87
Free Reserves Per Share (Rs) 8.71 6.99 69.33
Bonus in Equity Capital 50 50 50
Profitability Ratios
Operating Profit Margin (%) 21.38 14.86 37.79
Profit Before Interest And Tax Margin
(%)
15.06 7.55 33.88
Gross Profit Margin (%) 15.57 7.88 34.8
Cash Profit Margin (%) 15.35 7.78 20.96
Adjusted Cash Margin (%) 15.35 7.78 20.96
Net Profit Margin (%) 9.38 0.89 18.02
Adjusted Net Profit Margin (%) 9.38 0.89 18.02
Return On Capital Employed (%) 19.49 16.56 52.52
Return On Net Worth (%) 17.25 1.39 49.08
Adjusted Return on Net Worth (%) 17.91 1.71 49.17
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 49
Return on Assets Excluding
Revaluations
9.91 8.2 81.42
Return on Assets Including
Revaluations
9.91 8.2 81.42
Return on Long Term Funds (%) 30.87 18.38 52.52
Liquidity And Solvency Ratios 1.13 1.11 1.4
Current Ratio 1.43 1.18 1.4
Quick Ratio 0.73 0.11 0.89
Debt Equity Ratio 0.09 -- 0.89
Long Term Debt Equity Ratio
Debt Coverage Ratios 10.44 2.04 5.46
Interest Cover 0.73 0.11 0.89
Total Debt to Owners Fund 9.25 2.37 5.83
Financial Charges Coverage Ratio 6.8 1.97 4.09
Financial Charges Coverage Ratio Post
Tax
Management Efficiency Ratios -- -- --
Inventory Turnover Ratio 1.85 1.71 2.22
Debtors Turnover Ratio -- -- --
Investments Turnover Ratio -- -- --
Fixed Assets Turnover Ratio -- -- 1.57
Total Assets Turnover Ratio 2.2 1.6 3.24
Asset Turnover Ratio
-- -- --
Average Raw Material Holding -- -- --
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 50
Average Finished Goods Held 210.34 71.89 154.66
Number of Days In Working Capital -- -- --
Profit & Loss Account Ratios -- -- --
Material Cost Composition 0.52 1.1 0.91
Imported Composition of Raw
Materials Consumed
-- -- --
Selling Distribution Cost Composition
Expenses as Composition of Total Sales -- -- 23.42
Cash Flow Indicator Ratios -- -- 20.16
Dividend Payout Ratio Net Profit 100 100 76.63
Dividend Payout Ratio Cash Profit 100 100 79.87
Earning Retention Ratio 2.58 0.91 1.57
Cash Earning Retention Ratio
Adjusted Cash Flow Times
Mar '10 Mar '09 Mar '08
Earnings Per Share 1.71 0.11 39.96
Book Value 9.91 8.2 81.42
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 51
Aditya Birla Chemical
Balance Sheet
------------------- in Rs. Cr. -------------------
Mar '11 Mar '10 Mar '09
Sources Of Funds 12 mths 12 mths 12 mths
Total Share Capital 23.39 23.39 23.39
Equity Share Capital 23.39 23.39 23.39
Share Application Money 0 0 0
Preference Share Capital 0 0 0
Reserves 328.66 265.97 216.57
Revaluation Reserves 0 0 0
Networth 352.05 289.36 239.96
Secured Loans 26.05 43.8 45.76
Unsecured Loans 0.1 0.26 0.41
Total Debt 26.15 44.06 46.17
Total Liabilities 378.2 333.42 286.13
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 52
Mar '11 Mar '10 Mar '09
Application Of Funds 12 mths 12 mths 12 mths
Gross Block 384.17 379.19 374.34
Less: Accum. Depreciation 143.45 125.57 105.82
Net Block 240.72 253.62 268.52
Capital Work in Progress 14.13 2.72 1.4
Investments 46.02 30.94 0.3
Inventories 19.56 20.81 11.13
Sundry Debtors 25.36 24.95 20.55
Cash and Bank Balance 63.02 3.26 1.02
Total Current Assets 107.94 49.02 32.7
Loans and Advances 28.17 24.84 32.7
Fixed Deposits 0 41.99 28.95
Total CA, Loans & Advances 136.11 115.85 94.35
Deffered Credit 0 0 0
Current Liabilities 53.67 59.37 70.88
Provisions 5.11 10.35 8.2
Total CL & Provisions 58.78 69.72 79.08
Net Current Assets 77.33 46.13 15.27
Miscellaneous Expenses 0 0 0.61
Total Assets
378.2 333.41 286.1
Contingent Liabilities 79.72 74.54 72.27
Book Value (Rs) 150.53 123.73 102.6
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 53
Profit & Loss account
------------------- in Rs. Cr. -------------------
Mar '11 Mar '10 Mar '09
Income
12 mths 12 mths 12 mths
Sales Turnover 262.65 243.55 231.58
Excise Duty 24.82 19.17 26.56
Net Sales 237.83 224.38 205.02
Other Income 15.2 4.46 5.45
Stock Adjustments 0.11 -0.75 -0.05
Total Income 253.14 228.09 210.42
Expenditure
Raw Materials 113.37 104.46 97.16
Power & Fuel Cost 19.52 17.47 9.04
Employee Cost 13.22 13.25 13.17
Other Manufacturing Expenses 4.13 3.08 2.83
Selling and Admin Expenses 0 6.81 5.41
Miscellaneous Expenses 8.46 2.21 2.95
Preoperative Exp Capitalised 0 0 0
Total Expenses 158.7 147.28 130.56
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 54
Mar '11 Mar '10 Mar '09
12 mths 12 mths 12 mths
Operating Profit
79.24 76.35 74.41
PBDIT 94.44 80.81 79.86
Interest 2.64 3.57 5.58
PBDT 91.8 77.24 74.28
Depreciation 20.36 20.04 18.71
Other Written Off 0 0.57 0.55
Profit Before Tax 71.44 56.63 55.02
Extra-ordinary items -0.41 7.34 1.16
PBT (Post Extra-ord Items) 71.03 63.97 56.18
Tax 8.74 10.48 9.53
Reported Net Profit 62.71 60.74 46.08
Total Value Addition 45.32 42.81 33.41
Preference Dividend 0 0 0
Equity Dividend 1.17 3.51 3.51
Corporate Dividend Tax 0.19 0.58 0.6
Per share data (annualized)
Shares in issue (Lakhs) 233.87 233.87 233.87
Earnings Per Share (Rs) 26.81 25.97 19.7
Equity Dividend (%) 5 15 15
Book Value (Rs) 150.53 123.73 102.6
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 55
Key Financial Ratios
------------------- in Rs. Cr. -------------------
Mar '11 Mar '10 Mar '09
Investment Valuation Ratios
Face Value 10 10 10
Dividend Per Share 0.5 1.5 1.5
Operating Profit Per Share (Rs) 33.89 32.65 31.81
Net Operating Profit Per Share (Rs) 101.7 95.94 87.67
Bonus in Equity Capital -- -- --
Profitability Ratios
Operating Profit Margin(%) 33.32 34.02 36.28
Profit Before Interest And Tax Margin(%) 23.27 24.6 26.39
Gross Profit Margin(%) 24.76 25.09 27.16
Cash Profit Margin(%) 32.83 29.18 30.9
Adjusted Cash Margin(%) 32.83 29.18 30.9
Net Profit Margin(%) 24.78 26.53 21.84
Adjusted Net Profit Margin(%) 24.78 26.53 21.84
Return On Capital Employed(%) 19.58 18.07 21.33
Return On Net Worth(%) 17.81 20.99 19.25
Adjusted Return on Net Worth(%) 17.81 15.96 19.18
Return on Assets Excluding Revaluations 150.53 123.73 102.34
Return on Assets Including Revaluations 150.53 123.73 102.34
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 56
Return on Long Term Funds(%) 19.58 18.65 21.41
Liquidity And Solvency Ratios
Current Ratio 2.32 1.28 1.16
Quick Ratio 1.98 1.35 1.04
Debt Equity Ratio 0.07 0.15 0.19
Long Term Debt Equity Ratio 0.07 0.12 0.19
Debt Coverage Ratios
Interest Cover 28.06 16.87 10.94
Total Debt to Owners Fund 0.07 0.15 0.19
Financial Charges Coverage Ratio 35.77 22.64 14.39
Financial Charges Coverage Ratio Post Tax 32.47 23.77 12.71
Management Efficiency Ratios
Inventory Turnover Ratio 13.43 13.05 26.19
Debtors Turnover Ratio 9.45 9.86 11.46
Investments Turnover Ratio 13.43 13.05 26.19
Fixed Assets Turnover Ratio 0.62 0.59 0.55
Total Assets Turnover Ratio 0.63 0.68 0.72
Asset Turnover Ratio 0.62 0.59 0.55
Average Raw Material Holding -- 63.03 22.02
Average Finished Goods Held -- 3.15 5.88
Number of Days In Working Capital 117.06 74.02 26.84
Profit & Loss Account Ratios
Material Cost Composition 47.66 46.55 47.39
Imported Composition of Raw Materials
Consumed
-- -- --
Selling Distribution Cost Composition -- 1.88 1.32
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 57
Expenses as Composition of Total Sales 0.2 0.22 0.38
Cash Flow Indicator Ratios
Dividend Payout Ratio Net Profit 2.16 6.73 8.9
Dividend Payout Ratio Cash Profit 1.63 5.02 6.28
Earning Retention Ratio 97.84 91.15 91.07
Cash Earning Retention Ratio 98.37 93.88 93.71
Adjusted Cash Flow Times
0.31 0.66 0.71
Mar '11 Mar '10 Mar '09
Earnings Per Share 26.81 25.97 19.7
Book Value 150.53 123.73 102.6
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 58
Aditya Birla Nuvo
Balance Sheet
------------------- in Rs. Cr. -------------------
Mar '10 Mar '09 Mar '08
12 mths 12 mths 12 mths
Sources Of Funds
Total Share Capital 103.11 95.01 95.01
Equity Share Capital 103.01 95.01 95.01
Share Application Money 142.07 377.41 377.41
Preference Share Capital 0.1 0 0
Reserves 4,416.33 3,649.24 3,551.32
Revaluation Reserves 0 0 0
Net worth 4,661.51 4,121.66 4,023.74
Secured Loans 2,067.38 2,217.07 1,856.72
Unsecured Loans 1,568.27 2,282.14 886.7
Total Debt 3,635.65 4,499.21 2,743.42
Total Liabilities 8,297.16 8,620.87 6,767.16
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 59
Mar '10 Mar '09 Mar '08
12 mths 12 mths 12 mths
Application Of Funds
Gross Block 3,564.71 3,290.16 3,111.78
Less: Accum. Depreciation 2,012.49 1,813.95 1,680.89
Net Block 1,552.22 1,476.21 1,430.89
Capital Work in Progress 263.06 128.78 70.73
Investments 5,435.85 5,712.39 4,054.17
Inventories 876.34 747.6 776.6
Sundry Debtors 693.33 887.23 760.98
Cash and Bank Balance 13.18 36.05 56.19
Total Current Assets 1,582.85 1,670.88 1,593.77
Loans and Advances 684.4 557.7 502.11
Fixed Deposits 1.13 53.76 40.96
Total CA, Loans & Advances 2,268.38 2,282.34 2,136.84
Deferred Credit 0 0 0
Current Liabilities 1,104.09 882.41 791.99
Provisions 118.26 96.44 133.48
Total CL & Provisions 1,222.35 978.85 925.47
Net Current Assets 1,046.03 1,303.49 1,211.37
Miscellaneous Expenses 0 0 0
Total Assets
8,297.16 8,620.87 6,767.16
Contingent Liabilities 809.65 991.33 810
Book Value (Rs) 438.73 394.09 383.79
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 60
Profit & Loss account
------------------- in Rs. Cr. -------------------
Mar '10 Mar '09 Mar '08
12 mths 12 mths 12 mths
Income
Sales Turnover 4,981.85 4,997.21 4,145.75
Excise Duty 160.4 211.08 212.8
Net Sales 4,821.45 4,786.13 3,932.95
Other Income -64.69 60.24 69.94
Stock Adjustments -3.16 17.89 83.17
Total Income 4,753.60 4,864.26 4,086.06
Expenditure
Raw Materials 2,577.99 2,749.62 2,236.86
Power & Fuel Cost 431.57 537.38 359.66
Employee Cost 347.63 287.91 258.2
Other Manufacturing Expenses 117.12 115.43 115.89
Selling and Admin Expenses 493.13 463.92 367.72
Miscellaneous Expenses 91.26 85.18 93.03
Preoperative Exp Capitalised 0 0 0
Total Expenses 4,058.70 4,239.44 3,431.36
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 61
Mar '10 Mar '09 Mar '08
12 mths 12 mths 12 mths
Operating Profit 759.59 564.58 584.76
PBDIT 694.9 624.82 654.7
Interest 334.1 290.64 204.47
PBDT 360.8 334.18 450.23
Depreciation 180.1 165.96 141.1
Other Written Off 0 0 0
Profit Before Tax 180.7 168.22 309.13
Extra-ordinary items 4.25 29.23 41.18
PBT (Post Extra-ord Items) 184.95 197.45 350.31
Tax 41.15 60.02 107.24
Reported Net Profit 283.4 137.43 243.07
Total Value Addition 1,480.71 1,489.82 1,194.50
Preference Dividend 0 0 0
Equity Dividend 51.51 38 54.63
Corporate Dividend Tax 7.95 4.43 9.28
Per share data (annualised)
Shares in issue (lakhs) 1,030.10 950.09 950.08
Earning Per Share (Rs) 27.51 14.46 25.58
Equity Dividend (%) 50 40 57.5
Book Value (Rs) 438.73 394.09 383.79
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 62
Key Financial Ratios
------------------- in Rs. Cr. -------------------
Mar '10 Mar '09 Mar '08
Investment Valuation Ratios
Face Value 10 10 10
Dividend Per Share 5 4 5.75
Operating Profit Per Share (Rs) 73.74 59.42 61.55
Net Operating Profit Per Share (Rs) 468.06 503.75 413.96
Free Reserves Per Share (Rs) 393.52 378.8 370.52
Bonus in Equity Capital 22.68 24.59 24.59
Profitability Ratios
Operating Profit Margin(%) 15.75 11.79 14.86
Profit Before Interest And Tax
Margin(%)
11.85 8.22 11.17
Gross Profit Margin(%) 12.01 8.32 11.28
Cash Profit Margin(%) 9.23 5.62 7.8
Adjusted Cash Margin(%) 9.23 5.62 7.8
Net Profit Margin(%) 5.79 2.83 6.12
Adjusted Net Profit Margin(%) 5.79 2.83 6.12
Return On Capital Employed(%) 7.79 5.3 7.1
Return On Net Worth(%) 6.27 3.67 6.66
Adjusted Return on Net Worth(%) 6 2.84 4.63
Return on Assets Excluding
Revaluations
438.73 394.09 383.79
Return on Assets Including
Revaluations
438.73 394.09 383.79
Return on Long Term Funds(%) 8.95 7.13 8.75
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 63
Liquidity And Solvency Ratios
Current Ratio 0.97 0.71 1.04
Quick Ratio 1.11 1.54 1.44
Debt Equity Ratio 0.8 1.2 0.75
Long Term Debt Equity Ratio 0.6 0.71 0.5
Debt Coverage Ratios
Interest Cover 1.94 1.57 2.35
Total Debt to Owners Fund 0.8 1.2 0.75
Financial Charges Coverage Ratio 2.47 2.14 3.04
Financial Charges Coverage Ratio Post
Tax
2.39 2.04 2.88
Management Efficiency Ratios
Inventory Turnover Ratio 6.41 7.51 5.99
Debtors Turnover Ratio 6.1 5.81 5.8
Investments Turnover Ratio 6.41 7.51 5.99
Fixed Assets Turnover Ratio 1.44 1.55 1.35
Total Assets Turnover Ratio 0.6 0.57 0.6
Asset Turnover Ratio 1.44 1.55 1.35
Average Raw Material Holding 68.37 49.72 70.15
Average Finished Goods Held 24.93 23.87 28.62
Number of Days In Working Capital 78.1 98.05 110.88
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 64
Profit & Loss Account Ratios
Material Cost Composition 53.46 57.44 56.87
Imported Composition of Raw
Materials Consumed
56.59 61 59.49
Selling Distribution Cost
Composition
7.02 6.69 6.48
Expenses as Composition of Total
Sales
13 13.39 16
Cash Flow Indicator Ratios
Dividend Payout Ratio Net Profit 20.98 30.87 26.29
Dividend Payout Ratio Cash Profit 12.82 13.98 16.63
Earning Retention Ratio 78.1 60.1 62.18
Cash Earning Retention Ratio 86.84 84.42 79.39
AdjustedCash Flow Times 8.05 16.52 8.85
Mar '10 Mar '09 Mar '08
Earnings Per Share 27.51 14.46 25.58
Book Value 438.73 394.09 383.79
Padmini.M.S. ----M.P. Birla Institute of Management----Organizational Study at Aditya Birla 65
Bibliography/ Webliography
http://www.adityabirla.com/
http://www.adityabirlafinance.com/
http://www.moneycontrol.com/stocksmarketsindia/