pr on radio mantrar

8/6/2019 Pr on Radio Mantrar

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DISSERTATION ON

SUMMER INTERNSHIP CARRIED OUT AT RADIO MANTRA

,GORAKHPUR ,UP UNDER THE GUIDANCE OF VIVEK

SRIVAASTAV.

SUBMITTED FOR EVALUATION UNDER SUMMER INTERNSHIP

PROJECT

TO

FACULTY OF MANAGEMENT

JAYOTI VIDYAPEETH WOMEMS UNIVERSITY,JAIPUR

BY

DEEPIKA YADAV

JV-M/10/1211

MBA 3RD

TRIMESTER


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ACKNOWLEDGEMENT

The satisfaction Euphoria that accompanies the successful

completion of any work would be incomplete unless we

mention the name of the person, who made it possible, whose

constant guidance and encouragement served as a beckon of

light and crowned our efforts with success. I consider it a

privilege to express through the pages of this report, a few

words of gratitude and respect to those who guided and

inspired in the completion of this project.

I am deeply indebted to Mr.AMIT YADAV for giving me theopportunity to undergo my project in their esteemed organization andtheir timely suggestions & Valuable guidance. I also want to give thanksto MR. VIVEK SRIVAASTAV (Accounting Dept) and all the staffmembers .They constantly encouraged me and showed the right path

from day first till the completion of my project.My sincere thanks to and all the other faculty members, (Internal guide-

) for guiding me throughout the, project.

However, I accept the sole responsibility for any possible errors

of omission and would be extremely grateful to the readers of

this project report if they bring such mistakes to my notice.


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CONTENTS

y EXECUTIVE SUMMARY

y INTRODUCTION

1)INDUSTRY SCENARIO

2)ORGANSATION PROFILE

3)ORGANISATION STRUCTURE

4)OBJECTIVES OF STUDY

yBODY OF DISSERTATION

1)RESEARCH METHODOLOGY

2)DATA ANANLYSIS AND INTERPRETATION

3)SWOT ANANLYSIS OF RADIO INDUSTRY

y SUMMARY AND CONCLUSIONy LEARNING FROM INTERNSHIP

yWEEKLY ACTIVITY CHART

y REFERENCES AND BIBLIOGRAPHY


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EXECUTIVE SUMMARY

Project Title: Financial Statement AnalysisCompany Name: RADIO MANTRAThe training at RADIO MANTRA involved the day to day

working at accounts departments with the senior & junior

managers and research department in the company. This

project helped me to get the deeper understanding of the

process of Financial Statement Analysis and how decisions aretaken to strengthen the financial position.

Main objective in undertaking this project is to supplementacademic knowledge with absolute practical exposure to day today functions of the sector.

Financial analysis which is the topic of this project refers to an

assessment of the viability, stability and profitability of a

business. This important analysis is performed usually by

finance professionals in order to prepare financial or annual

reports. These financial reports are made with using the

information taken from financial statements of the company

and it is based on the significant tool of Ratio Analysis. These

reports are usually presented to top management as one of

their basis in making crucial business decisions.


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INDUSTRY SCENARIO

Evolution of Radio Broadcasting in

India

1935: Radio broadcast begins with AIR.1977: First FM service in Madras.1993 : AIR sells time slots for private FM radio broadcasting in

five cities.1999: Privatization of FM - Phase I Policy.

2001: Licenses given to private radio broadcasters.2005: Announcement of Phase II Policy of privatization of FM.

Changes in the licensing regime 338 licenses in 91 cities were up for bidding

280 licenses successfully awarded

In 2002, Radio covered 128 cities, footprint cover of 30% of the

populationincreased to 56 % in 2004 Over 10 million listeners in Mumbai and Delhi alonenumberincreasing each day !(no 8.4 million in previous wave) Almost 57% of total listeners listen to FM on an average of 1hour everyday. Onweekdays, tune ins as high as 99%

Places of Listenership At home (84%) While Driving (5%) Public Places (9%)

Office (9%)


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Radio to FM: The FM Wave

FM credited for sparking interest in radio again which hadsomewhere relegated from our focus

FM has managed to repositioned AIR radio as boring,govt. owned,not fashionable, virtually dated, not so competitiveimagery

FM considered to be hip, glamorous, youthful, vibrant &in vogue

with changing times.


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ORGANISATION PROFILE

RADIO MANTRA HAS BEEN PROMOTED BY SHRI PURAN

MULTIMEDIA LTD.,A JAGRAN GROUP COMPANY.RADIO

MANTRA IS A FIRST FM RADIO STATION IN

GORAKHPUR. .

Venture of the Jagran Group Strong Credibility of Dainik Jagran, Indias largest read

newspaper Media background Well -versed / connected with the market In-house media units : J9 SMS @ 7272Solutions for Below-the-line Engage for Outdoors Research

Radio mantra, 91.9FMPost years of experience in various media , Dainik Jagran, adds anotherbooming media ,Radio, to its basket.

Radio Mantra is ready to spread its wings across 4 zoneswith its 8 stations:UPAgra

Varanasi

Bareilly


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Gorakhpur

PunjabJalandhar

HaryanaHisarKarnal

JharkhandRanchi

Radio mantra, life ka mantraFrequency: 91.9F MA Contemporary Hit Radio StationCompetitive differentiation

Perfect blend of Local & Metro Content: Music and non-musicAn aspirational medium for both listeners and advertisersPromises to deliver competitive content, style & productionquality.

Radio mantra : Business StrategyIs venturing its journey with the Virgin markets withholdinghuge unexploredPotential.

With leading newspaper background, Radio Mantra, understandsthe Local PulseBetter.

One of the first FM station to bring FMism in its universe

Strategically plans to bring Radio Revolution to its universe &thus, Pioneer in thefuture markets of India.


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Radio mantra :Target profileBEHAVIORAL

Benefits sought: Free Non-stop Music, General /local

infotainmentPurchase Occasion: Driving, at home, absence of electricity, In

canteen or restaurant, Exercising: walk/jog/gymPurchase behavior: Seeking music, local information such as

traffic or weather forecast,Seeking company, want to be entertainedUSAGE PATTERN

Alternate entertainment in absence of electricity

ANDMorning :5-8amRush hours: 8-11am and 5-8 pmLunch time: 12-2pm(Specifically for office/college)My time/space: 9pm till midnightPSYCHOGRAPHIC

Lifestyle: Music lovers, Keeps up beat withsocial trends, High aspiration values

Personality: Aspirants, Fun loving, Myhappiness, my way.

Universe ofRadio Mantra, 91.9FM

Jalandhar: Canadian in Indian skinFor 16.89 lks population* of Jalandhar, the point of reference isCanada that hasresulted in a High quality lifestyle.


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Literacy rate of 78% that is higher than the national average of59.5%

The city is the media & mass communication hub of the regionhaving the regionalheadquarters of the national television and radio channels. Theprint media in thecity currently growing by 20% every year.

Boom in the Real estate industry in Jalandhar is comparable toone of the otherstate capitals

The city is well known for its production of sports equipment,leather goods &rubber goods.The major sports giants such as Adidas, Reebok, and Mitreoutsource footballs,cricket & hockey equipment from Jalandhar.

Agra:28.63 lks population* are largely Delhi driven with high portionof urban population.Of the total population, around 11 lks make urban population (asper thesurvey in 2001).

Agra has an average literacy rate of 65%, higher than thenational average of

59.5%.Agra was the Test market for Coke when it was launching inIndia.

Luxury indulgence is the lifestyle with indicators such as bigbungalows & premium cars.


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About 65% of total domestic requirement of shoes in India issupplied fromAgra economy.

Agra city is famous for the Leather Goods, Handicrafts, ZariZardozi, Marveland Stone carving & inlay work.

High Tourist traffic thus high awareness level aboutinternational brands and has resultedinto a Fashion conscious population.Various premium accommodations (eleven 5star hotel) availablein the city.

Varanasi: the contrastVaranasi is of the India's oldest cities, with a population of 24.52lks*

The literacy rate in the urban agglomeration is 61.5%One of the world's oldest cities makes Varanasi a Hot Touristdestination forforeigner'sA number of 3 - 4 star hotels are present in the city.Younger generation is seeking to escape from the cultural rules& regulations & arelooking forward to develop

High social influence leading to community culture:neighbourhood decide the rights orthe wrongs of each issue.Gourmet delight: All sort of cuisines are available mostly asstreet food due torich & hospitable culture ofVaranasi.

Varanasi is a commercial & industrial centre of muslin & silkfabrics, perfumes,ivory works, & sculpture.


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Varanasi is well connected by air, rail and buses with all theimportant places.

Gorakhpur:

Radio Mantra is THE ONLY PRIVATE FM that will entertain31.59lks population* of thecity.This city sees up to 10-12 hours of power cuts which will ensurehigh radio listenership.The residents are highly techno savvy.The youth of this city come across as very fashion conscious,keeping in tune with thelatest fashion trends.The shopping mall, Baldev Plaza is also in Golghar & housessome of the bestshops in Gorakhpur.

Accessibility to Nepal.Gorakhpur civil airport caters to flights on regular basis to Delhi,Lucknow,

Varanasi, Allahabad, Bangalore, and Mumbai.Existence of well established institutions such as Institute ofTechnology &Management(ITM), Hallmark School, Medical College Road, etc.

Focus of consumer durable industry.

Ranchi: New Face to JharkhandRanchi is the capital of the newly formed state of Jharkhandwith Population of22.34lks*, it is situated in northeast India, west-northwest ofCalcutta.


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The literacy rate is around 74% which is more than the nationalaverage of59%.

International airport is in progress with national air connectivityfrom Bhagwan BirsaMunda Airport of Ranchi to Delhi, Patna, Mumbai, Raipur andKolkata.Increased Traffic thus an opportunity to create FM listernship.Existence of well established institutions like St Xaviers, BIT,DPS, Loreto Convent,Bishop Westcott Boys' School , Cambridge School, Birla Institute

ofTechnology,

Ranchi has numerous eateries offering delicacies from Indiaand the worldsuch as Capitol Hill, Thai Spice, Masala Bowl , Kaveri, PunjabSweets, ShivSagar Chain, Kathi Kabab, Seventh Heaven, Bholu Bhai etc.

Fashion cautious: Aspire to be FashionableJharkhand also earns good amount of revenue through itstourism industry.


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Direct Competition

STATION COMPETITIONJalandhar Adlab Synergy, ENILKarnal BAG FilmsGorakhpur - None-

Agra Adlabs, Pan IndiaRanchi Adlabs, BAG Films, Neutral

The Launches

Radio Mantra has beenthe first station tosuccessfully go on air inits areas of operationwith advertisements andradio jockeys

Each launch was greetedby the city with a specialsupplement in DJ whichwas full of congratulatorymessages, some


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advertisers even boughtradio spots as a specialcombo launch deal.

ORGANISATION STRUCTURE

The departments in RADIO MANTRA are

1)ACCOUNTS DEPARTMENT2)HR DEPARTMENT3)SALES AND MARKETING4)PROGRAMMER

In each accounts,human resource,sales andmarketing departments there is a manager andother employees working under them. Theprogrammer sets the detail of each programs onradio mantra.


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OBJECTIVES OF STUDY

There have been various objectives for this study,the first of which is a detailed analysis of thefinancial statements that is the balance sheet and theincome statement of Radio mantra.The second objective, however the most importantone or in other word the principle aim of this projectis the understanding and assessment of financialratios based on the statements of Radio mantra.The next aim of the project is to recognize the

position of the company through those ratios and

data available. This recognition is a leading factor inchanges of each and every company and the base

and root of lots of management decisions.


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BODY OF DISSERTATION

RESEARCH METHODOLOGY

Research framework: This study is based on the data aboutRADIO MANTRA for a detailed study of its financialstatements, documents and system ratios and finally to recognize

and determine the position of the company.The secondary data which was already prepared so these datawas only used to reach the aims and objectives of this project.These data has been collected from the financial reports of thecompany.Printed and Digital Sources:

The secondary data I collected was through the study of thefinancial statements already existed in the company in form of

printed files or digital files reserved in the company for furtherreferences. I had chosen these files because of the reliability andsuitability of these information which I was also sure about theaccuracy of them.These files contained details about1. Annual report of the company2. Financial balance sheets

3. Income statements4. Financial reports5. Different reports prepared by Finance Department


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DATAANNLYSIS AND INTERPRETATION

FINANCIAL STATEMENTS

Financial statements are summaries of the operating, financing,

and investment activities of a business. Financial statements

should provide information useful to both investors andcreditors in making credit, investment, and other business

decisions. And this usefulness means that investors and

creditors can use these statements to predict, compare, and

evaluate the amount, timing, and uncertainty of potential cash

flows. In other words, financial statements provide the

information needed to assess a companys future earnings and

therefore the cash flows expected to result from thoseearnings. In this chapter, we discuss the four basic financial

statements: the balance sheet, the income statement, the

statement of cash flows, and the statement of shareholders

equity.

ACCOUNTING PRINCIPLES AND ASSUMPTIONS

The accounting data in financial statements are prepared by thefirms management according to a set of standards, referred to asgenerally accepted accounting principles (GAAP). The financialstatements of a company whose stock is publicly traded must, bylaw, be audited at least annually by independent publicaccountants (i.e., accountants who are not employees of the


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firm). In such an audit, the accountants examine the financialstatements and the data from which these statements areprepared and attestthrough the published auditors opinion

that these statements have been prepared according to GAAP.The auditors opinion focuses on whether the statementsconform to GAAP and that there is adequate disclosure of anymaterial change in accounting principles.The financial statements are created using several assumptions

that affect how we use and interpret the financial data:

Transactions are recorded at historical cost. Therefore, thevalues shown in the statements are not market or replacementvalues, but rather reflect the original cost (adjusted fordepreciation, in the case of depreciable assets).

The appropriate unit of measurement is the dollar. While

this seems logical, the effects of inflation, combined with thepractice of recording values at historical cost, may causeproblems in using and interpreting these values.

The statements are recorded for predefined periods of time.Generally, statements are produced to cover a chosen fiscal yearor quarter, with the income statement and the statement of cashflows spanning a periods time and the balance sheet and

statement of shareholders equity as of the end of the specifiedperiod. But because the end of the fiscal year is generally chosento coincide with the low point of activity in the firms operatingcycle, the annual balance sheet and statement of shareholdersequity may not be representative of values for the year.


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Statements are prepared using accrual accounting and thematching principle. Most businesses use accrual accounting,where income and revenues are matched in timing such that

income is recorded in the period in which it is earned andexpenses are reported in the period in which they are incurred togenerate revenues. The result of the use of accrual accounting isthat reported income does not necessarily coincide with cashflows. Because the financial analyst is concerned ultimately withcash flows, he or she often must understand how reportedincome relates to a companys cash flows.

It is assumed that the business will continue as a goingconcern. The assumption that the business enterprise willcontinue indefinitely justifies the appropriateness of usinghistorical costs instead of current market values because theseassets are expected to be used up over time instead of sold.

Full disclosure requires providing information beyond thefinancial statements. The requirement that there be full

disclosure means that, in addition to the accounting numbers forsuch accounting items as revenues, expenses, and assets,narrative and additional numerical disclosures are provided innotes accompanying the financial statements. An analysis offinancial statements is therefore not complete without thisadditional information.

Statements are prepared assuming conservatism. In cases inwhich more than one interpretation of an event is possible,statements are prepared using the most conservativeinterpretation.The financial statements and the auditors findings are publishedin the firms annual and quarterly reports sent to shareholdersand the 10K and 10Q filings with the Securities and Exchange


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Commission (SEC).Also included in the reports, among otheritems, is a discussion by management, providing an overview ofcompany events. The annual reports are much more detailed and

disclose more financial information than the quarterly reports.


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There are three basic financial statements:

Balance sheet

Income statement

Cash Flow statement

THE BALANCE SHEETThe balance sheet is a summary of the assets, liabilities, andequity of a business at a particular point in timeusually theend of the firms fiscal year. The balance sheet is also known asthe statement of financial condition or the statement of financial

position. The values shown for the different accounts on thebalance sheet are not purported to reflect current market values;rather, they reflect historical costs.Assets are the resources of the business enterprise, such as plantand equipment that are used to generate future benefits. If acompany owns plant and equipment that will be used to producegoods for sale in the future, the company can expect these assets

(the plant and equipment) to generate cash inflows in the future.Liabilities are obligations of the business. They representcommitments to creditors in the form of future cash outflows.When a firm borrows, say, by issuing a long-term bond, itbecomes obligated to pay interest and principal on this bond aspromised. Equity, also called shareholders equity orstockholders equity, reflects ownership. The equity of a firmrepresents the part of its value that is not owed to creditors and

therefore is left over for the owners. In the most basicaccounting terms, equity is the difference between what the firmownsits assetsand what it owes its creditorsits liabilities.ASSETS


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There are two major categories of assets: current assets andnoncurrent assets, where noncurrent assets include plant assets,intangibles, and investments. Assets that do not fit neatly into

these categories may be recorded as either other assets, deferredcharges, or other noncurrent assets.CURRENT ASSETS

Current assets (also referred to as circulating capital andworking assets) are assets that could reasonably be convertedinto cash within one operating cycle or one year, whichevertakes longer. An operating cycle begins when the firm investscash in the raw materials used to produce its goods or services

and ends with the collection of cash for the sale of those samegoods or services. For example, ifFictitious manufactures andsells candy products, its operating cycle begins when itpurchases the raw materials for the products (e.g., sugar) andends when it receives cash for selling the candy to retailers.Because the operating cycle of most businesses is less than oneyear, we tend to think of current assets as those assets that can

be converted into cash in one year. Current assets consist ofcash, marketable securities, accounts receivable, and inventories.Cash comprises both currencybills and coinsand assets thatare immediately transformable into cash, such as deposits inbank accounts. Marketable securities are securities that can bereadily sold when cash is needed. Every company needs to havea certain amount of cash to fulfil immediate needs, and any cashin excess of immediate needs is usually invested temporarily inmarketable securities. Investments in marketable securities aresimply viewed as a short term place to store funds; marketablesecurities do not include those investments in other companiesstock that are intended to be long term. Some financial reportscombine cash and marketable securities into one account


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referred to as cash and cash equivalents or cash and marketablesecurities. Accounts receivable are amounts due from customerswho have purchased the firms goods or services but havent yet

paid for them. To encourage sales, many firms allow theircustomers to buy now and pay later, perhaps at the end ofthe month or within 30 days of the sale. Accounts receivabletherefore represents money that the firm expects to collect soon.Because not all accounts are ultimately collected, the grossamount of accounts receivable is adjusted by an estimate of theuncollectible accounts, the allowance for doubtful accounts,resulting in a net accounts receivable figure. Inventories

represent the total value of the firms raw materials, work-in-process, and finished (but as yet unsold) goods. A manufacturerof toy trucks would likely have plastic and steel on hand as rawmaterials, work-in-process consisting of truck parts and partlycompleted trucks, and finished goods consisting of truckspackaged and ready for shipping. There are three basic methodsof accounting for inventory, including:

FIFO (first in, first out), which assumes that the first itemspurchased are the first items sold, LIFO (last in, first out), which assumes that the last itemspurchased are the first items sold, and Average cost, which assumes that the cost of items sold, is theaverage of the cost of all items purchased.The choice of inventory accounting method is significantbecause it affects values recorded on the balance sheet and theincome statement, as well as tax payments and cash flows.Another current asset account that a company may have is

prepaid expenses. Prepaid expenses are amounts that have

been paid but not as yet consumed. A common example is the

case of a company paying insurance premiums for an extended


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period of time (say, a year), but for which only a portion (say,

three months) is applicable to the insurance coverage for the

current fiscal year; the remaining insurance that is prepaid as of

the end of the year is considered an asset. Prepaid expensesmay be reported as part ofother current liabilities.

Companies investment in current assets depends, in large part,on the industry in which they operate.Noncurrent Assets

Noncurrent assets are assets that are not current assets; that is, itis not expected that noncurrent assets can be converted into cashwithin an operating cycle. Noncurrent assets include physicalassets, such as plant and equipment, and nonphysical assets,such as intangibles.Plant assets are the physical assets, such as the equipment,machinery, and buildings, which are used in the operation of thebusiness. We describe a firms current investment in plant assets

by using three values: gross plant assets, accumulateddepreciation, and net plant assets. Gross plant and equipment,or gross plant assets, is the sum of the original costs of allequipment, buildings, and machinery the firm uses to produce itsgoods and services. Depreciation, as you will see in the nextchapter, is a charge that accounts for the using up of an assetover the length of an accounting period; it is a means for

allocating the assets cost over its useful life. Accumulateddepreciation is the sum of all the depreciation charges taken sofar for all the companys assets. Net plant and equipment, ornet plant assets, is the difference between gross plant assets andaccumulated depreciation. The net plant and equipment amount


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is hence the value of the assetshistorical cost less anydepreciation- according to the accounting books and is thereforeoften referred to as the book value of the assets.

Intangible assets are the current value of nonphysical assetsthat represent long-term investments of the company. Suchintangible assets include patents, copyrights, and goodwill. Thecost of some intangible assets is amortized (spread out) overthe life of the asset. Amortization is akin to depreciation: Theassets cost is allocated over the life of the asset; the reportedvalue is the original cost of the asset, less whatever has beenamortized. The number of years over which an intangible asset

is amortized depends on the particular asset and its perceiveduseful life. For example, a patent is the exclusive right toproduce and sell a particular, uniquely defined good and has alegal life of 17 years, though the useful life of a patenttheperiod in which it adds value to the company-may be much lessthan 17 years. Therefore the company may choose to amortize apatents cost over a period less than 17 years. As another

example, a copyright is the exclusive right to publish and sell aliterary, artistic, or musical composition, and is granted for 50years beyond the authors life, though its useful life in terms ofgenerating income for the company may be much less than 50years. More challenging is determining the appropriateamortization period for goodwill. Goodwill was created whenone company buys another company at a price that exceeds theacquired companys fair market value of its assets.A company may have additional noncurrent assets, dependingon their particular circumstances. A company may have anoncurrent asset referred to as investments, which are assetsthat are purchased with the intention of holding them for a longterm, but which do not generate revenue or are not used to


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manufacture a product. Examples of investments include equitysecurities of another company and real estate that is held forspeculative purposes. Other noncurrent assets include long term

prepaid expenses, arising from prepayment for which a benefitis received over an extended period of time, and deferred taxassets, arising from timing differences between reported incomeand tax income, whereby reported income exceeds taxableincome.Long-term investment in securities of other companies may be

recorded at cost or market value, depending on the type of

investment; investments held to maturity are recorded at cost,

whereas investments held as trading securities or available for

sale are recorded at market value. Whether the unrealized

gains or losses affect earnings on the income statement depend

on whether the securities are deemed trading securities or

available for sale.

LIABILITIESLiabilities, a firms obligations to its creditors, are made up ofcurrent liabilities, long-term liabilities, and deferred taxes.Current Liabilities

Current liabilities are obligations that must be paid within oneoperating cycle or one year, whichever is longer. Currentliabilities include:Accounts payable, which are obligations to pay suppliers.

They arise from goods and services that have been purchasedbut not yet paid.

Accrued expenses, which are obligations such as wagesand salaries payable to the employees of the business, rent, andinsurance.


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Current portion of long-term debt or the current portionof capital leases. Any portion of long-term indebtednessobligations extending beyond one yeardue within the year.

Short-term loans from a bank or notes payable within ayear.

The reliance on short-term liabilities and the type of currentliabilities depends, in part, on the industry in which the firmoperates.LONG TERM LIABILITIES

Long-term liabilities are obligations that must be paid over aperiod beyond one year. They include notes, bonds, capital leaseobligations, and pension obligations. Notes and bonds bothrepresent loans on which the borrower promises to pay interestperiodically and to repay the principal amount of the loan.A lease obligates the lesseethe one leasing and using theleased assetto pay specified rental payments for a period oftime. Whether the lease obligation is recorded as a liability or isexpensed as lease payments made depends on whether the leaseis a capital lease or an operating lease.A companys pension and post-retirement benefit obligations

may give rise to long-term liabilities. The pension benefits are

commitments by the company to pay specific retirement

benefits, whereas post-retirement benefits include any other

retirement benefit besides pensions, such as health care.Basically, if the fair value of the pension plans assets exceeds

the projected benefitobligation(the estimated present value

of projected pension costs), the difference is recorded as a

long-term asset. If, on the other hand, the plans assets are less


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than the projected benefit obligation, the difference is

recorded as a long-term liability. In a similar manner, the

company may have an asset or a liability corresponding to post-

retirement benefits.

DEFFERED TAXESAlong with long-term liabilities, the analyst may encounteranother account, deferred taxes. Deferred taxes are taxes thatwill have to be paid to the federal and state governments basedon accounting income, but are not due yet. Deferred taxes arisewhen different methods of accounting are used for financialstatements and for tax purposes. These differences aretemporary and are the result of different timing of revenue orexpense recognition for financial statement reporting and taxpurposes. The deferred tax liability arises when the actual taxliability is less than the tax liability shown for financial reportingpurposes (meaning that the firm will be paying the difference inthe future), whereas the deferred tax asset, mentioned earlier,

arises when the actual tax liability is greater than the tax liabilityshown for reporting purposes.EQUITY


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Equity is the owners interest in the company. For a corporation,ownership is represented by common stock and preferred stock.Shareholders equity is also referred to as the book value of

equity, since this is the value of equity according to the recordsin the accounting books. The value of the ownership interest ofpreferred stock is represented in financial statements as its parvalue, which is also the dollar value on which dividends arefigured. For example, if you own a share of preferred stock thathas a $100 par value and a 9% dividend rate, you receive $9 individends each year. Further, your ownership share of thecompany is $100. Preferred shareholders equity is the product

of the number of preferred shares outstanding and the par valueof the stock; it is shown that way on the balance sheet. Theremainder of the equity belongs to the common shareholders. Itconsists of three parts: common stock outstanding (listed at paror at stated value), additional paid-in capital, and retainedearnings. The par value of common stock is an arbitrary figure;it has no relation to market value or to dividends paid on

common stock. Some stock has no par value, but may have anarbitrary value, orstated value, per share. Nonetheless, the totalpar value or stated value of all outstanding common shares isusually entitled capital stock or common stock. Then, toinject reality into the equity part of the balance sheet, an entrycalled additional paid-in capital is added; this is the amountreceived by the corporation for its common stock in excess ofthe par or stated value. If a firm sold 10,000 shares of $1 parvalue common stock at $40 a share, its equity accounts wouldshow:Common stock, $1 par value $10,000Additional paid-in capital $390,000


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There are actually four different labels that can be applied to thenumber of shares of a corporation on a balance sheet:The number of shares authorized

by the shareholders.The number of shares issued and sold by the corporation,which can be less than the number of shares authorized.

The number of shares currently outstanding, which can beless than the number of shares issued if the corporation hasbought back (repurchased) some of its issued stock.

The number of shares oftreasury stock, which is stock thatthe company has repurchased.

The outstanding stock is reported in the stock accounts, andadjustments must be made for any treasury stock. The bulk ofthe equity interest in a company is in its retained earnings. Aretained- earnings is the accumulated net income of thecompany, less any dividends that have not been paid, over the

life of the corporation. Retained earnings are not strictly cashand any correspondence to cash is coincidental. Any cashgenerated by the firm that has not been paid out in dividends hasbeen reinvested in the firms assetsto finance accountsreceivable, inventories, equipment, and so forth.THE INCOME STATEMENTAn income statement is a summary of the revenues andexpenses of a business over a period of time, usually one month,three months, or one year. This statement is also referred to asthe profit and loss statement. It shows the results of the firmsoperating and financing decisions during that time.The operating decisions of the companythose that apply toproduction and marketinggenerate sales orrevenues and


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incur the cost of goods sold (also referred to as the cost of salesor the cost of products sold). The difference between sales andcost of goods sold is gross profit.

CASH FLOW STATEMENT:

It is a statement, which measures inflows and outflows of cashon account of any type of business activity. The cash flowstatement also explains reasons for such inflows and outflows ofcash so it is a report on a company's cash flow activities,particularly its operating, investing and financing activities.


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FINANCIAL ANALYSIS

Financial analysis is a tool of financial management. It consistsof the evaluation of the financial condition and operating

performance of a business firm, an industry, or even theeconomy, and the forecasting of its future condition andperformance. It is, in other words, a means for examining riskand expected return. Data for financial analysis may come fromother areas within the firm, such as marketing and productiondepartments, from the firms own accounting data, or fromfinancial information vendors such as Bloomberg FinancialMarkets, Moodys Investors Service, Standard & PoorsCorporation, Fitch Ratings, and Value Line, as well as fromgovernment publications, such as the Federal Reserve Bulletin.Financial publications such as Business Week, Forbes, Fortune,and the Wall Street Journal also publish financial data(concerning individual firms) and economic data (concerningindustries, markets, and economies), much of which is now alsoavailable on the Internet.

Within the firm, financial analysis may be used not only toevaluate the performance of the firm, but also its divisions ordepartments and its product lines. Analyses may be performedboth periodically and as needed, not only to ensure informedinvesting and financing decisions, but also as an aid inimplementing personnel policies and rewards systems.Outside the firm, financial analysis may be used to determinethe creditworthiness of a new customer, to evaluate the ability ofa supplier to hold to the conditions of a long-term contract, andto evaluate the market performance of competitors.Firms and investors that do not have the expertise, the time, or

the resources to perform financial analysis on their own may

purchase analyses from companies that specialize in providing


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this service. Such companies can provide reports ranging from

detailed written analyses to simple creditworthiness ratings for

businesses. As an example, Dun & Bradstreet, a financial

services firm, evaluates the creditworthiness of many firms,from small local businesses to major corporations. As another

example, three companiesMoodys Investors Service,

Standard & Poors, and Fitchevaluate the credit quality of

debt obligations issued by corporations and express these

views in the form of a rating that is published in the reports

available from these three organizations.

Who uses these analyses?

Financial statements are used and analyzed by a different groupof parties, these groups consists of people both inside andoutside a business. Generally, these users are:A. Internal Users: are owners, managers, employees and other

parties who are directly connected with a company:1. Owners and managers require financial statements to makeimportant business decisions that affect its continued operations.Financial analysis is then performed on these statements toprovide management with more detailed information. Thesestatements are also used as part of management's report to itsstockholders, and it form part of the Annual Report of the

company.2. Employees also need these reports in making collectivebargaining agreements with the management, in the case oflabour unions or for individuals in discussing theircompensation, promotion and rankings.


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B. External Users: are potential investors, banks, governmentagencies and other parties who are outside the business but needfinancial information about the business for numbers of reasons.

1.P

rospective investors make use of financial statements toassess the viability of investing in a business. Financial analysesare often used by investors and is prepared by professionals(financial analysts), thus providing them with the basis inmaking investment decisions.2. Financial institutions (banks and other lending companies)use them to decide whether to give a company with fresh loansor extend debt securities (such as a long- term bank loan ).3. Government entities (tax authorities) need financialstatements to ascertain the propriety and accuracy of taxes andduties paid by a company.4. Media and the general public are also interested in financialstatements of some companies for a variety of reasons.


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FINANCIAL RATIO ANALYSISRatio analysis is such a significant technique for financialanalysis. It indicates relation of two mathematical expressions

and the relationship between two or more things.Financial ratio is a ratio of selected values on an enterprise'sfinancial statement.There are many standard ratios used to evaluate the overallfinancial condition of a corporation or other organization.Financial ratios are used by managers within a firm, by currentand potential stockholders of a firm, and by a firms creditor.Financial analysts use financial ratios to compare the strengths

and weaknesses in various companies.Values used in calculating financial ratios are taken frombalance sheet, income statement and the cash flow of company,besides Ratios are always expressed as a decimal values, such as0.10, or the equivalent percent value, such as 10%.Essence of ratio analysis:Financial ratio analysis helps us to understand how profitable a

business is, if it has enough money to pay debts and we can eventell whether its shareholders could be happy or not.Financial ratios allow for comparisons:1. between companies2. between industries3. between different time periods for one company4. between a single company and its industry averageTo evaluate the performance of one firm, its current ratios willbe compared with its past ratios. When financial ratios over aperiod of time are compared, it is called time series or trendanalysis. It gives an indication of changes and reflects whetherthe firms financial performance has improved or deteriorated or


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remained the same over that period of time. It is not the simplychanges that has to be determined, but more importantly it mustbe recognized that why those ratios have changed. Because

those changes might be result of changes in the accountingpolices without material change in the firms performances.Another method is to compare ratios of one firm with anotherfirm in the same industry at the same point in time. Thiscomparison is known as the cross sectional analysis. It might bemore useful to select some competitors which have similaroperations and compare their ratios with the firms. Thiscomparison shows the relative financial position and

performance of the firm. Since it is so easy to find the financialstatements of similar firms through publications orMedias thistype of analysis can be performed so easily.To determine the financial condition and performance of a firm,its ratios may be compared with average ratios of the industry towhich the firm belongs. This method is known as the industryanalysis that helps to ascertain the financial standing and

capability of the firm in the industry to which it belongs.Industry ratios are important standards in view of the fact thateach industry has its own characteristics, which influence thefinancial and operating relationships. But there are certainpractical difficulties for this method. First finding average ratiosfor the industries is such a headache and difficult. Second,industries include companies of weak and strong so the averagesinclude them also. Sometimes spread may be so wide that theaverage may be little utility. Third, the average may bemeaningless and the comparison not possible if the firms with inthe same industry widely differ in their accounting policies andpractices .


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What does ratio analysis tell us?After such a discussion and mentioning that these ratios are oneof the most important tools that is used in finance and that

almost every business does and calculate these ratios, it islogical to express that how come these calculations are of soimportance.What are the points that those ratios put light on them? And howcan these numbers help us in performing the task ofmanagement?The answer to these questions is: We can use ratio analysis totell us whether the business

1. is profitable2. has enough money to pay its bills and debts3. could be paying its employees higher wages, remuneration orso on4. is able to pay its taxes5. is using its assets efficiently or not6. has a gearing problem or everything is fine

7. is a candidate for being bought by another company orinvestorBut as it is obvious there are many different aspects that theseratios can demonstrate. So for using them first we have to decidewhat we want to know, then we can decide which ratios we needand then we must begin to calculate them.

Which Ratio for whom:As before mentioned there are varieties of people interested toknow and read these information and analyses, howeverdifferent people for different needs. And it is because each of


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these groups have different type of questions that could beanswered by a specific number and ratio.Therefore we can say there are different ratios for different

groups, these groups with the ratio that suits them is listedbelow:1. Investors: These are people who already have shares in thebusiness or they are willing to be part of it. So they need todetermine whether they should buy shares in the business, holdon to the shares they already have or sell the shares they alreadyown. They also want to assess the ability of the business to paydividends. As a result the Return on Capital Employed Ratio is

the one for this group.2. Lenders: This group consists of people who have given loansto the company so they want to be sure that their loans and alsothe interests will be paid and on the due time. Gearing Ratioswill suit this group.3. Managers: Managers might need segmental and totalinformation to see how they fit into the overall picture of the

company which they are ruling. And Profitability Ratios canshow them what they need to know.4. Employees: The employees are always concerned about theability of the business to provide remuneration, retirementbenefits and employment opportunities for them, therefore theseinformation must be find out from the stability and profitabilityof their employers who are responsible to provide the employeestheir need. Return on Capital Employed Ratio is themeasurement that can help them.

5. Suppliers and other trade creditors: Businesses supplyinggoods and materials to other businesses will definitely read theiraccounts to see that they don't have problems, after all, any


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supplier wants to know if his customers are going to pay themback and they will study the Liquidity Ratio of the companies.6. Customers: are interested to know the Profitability Ratio of

the business with which they are going to have a long terminvolvement and are dependent on the continuance of presenceof that.7. Governments and their agencies: are concerned with theallocation of resources and, the activities of businesses. Toregulate the activities of them, determine taxation policies and asthe basis for national income and similar statistics, they calculatethe Profitability Ratio of businesses.

8. Local community: Financial statements may assist the publicby providing information about the trends and recentdevelopments in the prosperity of the business and the range ofits activities as they affect their area so they are interested in lotsof ratios.

9. Financial analysts: they need to know various matters,

for example, the accounting concepts employed forinventories, depreciation, bad debts and so on. thereforethey are interested in possibly all the ratios.10. Researchers: researchers' demands cover a very widerange of lines of enquiry ranging from detailed statisticalanalysis of the income statement and balance sheet dataextending over many years to the qualitative analysis ofthe wording of the statements depending on their natureof research.


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CLASSIFICATION OF RATIOSIn isolation, a financial ratio is a useless piece of information. Incontext, however, a financial ratio can give a financial analyst an

excellent picture of a company's situation and the trends that aredeveloping. A ratio gains utility by comparison to other data andstandards.Financial ratios quantify many aspects of a business and are anintegral part of financial statement analysis. Financial ratios arecategorized according to the financial aspect of the businesswhich the ratio measures. Although these categories are notfixed in all over the world however there are almost the same,

just with different names:

1. Profitability ratios which use margin analysis and show thereturn on sales and capital employed.2. Rate of Return Ratio (ROR) or Overall ProfitabilityRatio: The rate of return ratios are thought to be the mostimportant ratios by some accountants and analysts. One reason

why the rate of return ratios is so important is that they are theratios that we use to tell if the managing director is doing theirjob properly.3. Liquidity ratios measure the availability of cash to paydebt,which give a picture of a company's short term financialsituation.4. Solvency or Gearing ratios measures the percentage ofcapital employed that is financed by debt and long term finance.The higher the gearing, the higher the dependence on borrowingand long term financing. The lower the gearing ratio, the higherthe dependence on equity financing. Traditionally, the higher thelevel of gearing, the higher the level of financial risk due to the


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increase volatility of profits. It should be noted that the termLeverage is used in some texts.5. Turn over Ratios or activity group ratios indicate efficiency

of organization to various kinds of assets by converting them tothe form of sales.6. Investors ratios usually interested by investors.


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FINANCIAL OVERVIEW OF ULTRATECH CEMENT LIMITEDBALANCE

SHEET As On31-03-2005 31-03-2006 31-032007 31-03-2008 31-03-2009

Fixed Assets Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr.

Gross Block 4304.29 4605.38 4784.7 4972.60 7,401.02

Net Block 2548.9 2537.21 2517.28 2500.46 4,635.69Capital WIP 48.18 141.03 696.95 2283.15 677.28Investment 184.79 172.39 483.45 170.90 1,034.80Current Assets

Inventories 283.71 379.57 433.58 609.76 691.97Debtors 171.95 172.55 183.50 216.61 186.18OtherCurrentAssets

381.99 220.4 343.09 477.52 483.46

Balance Sheet

Total

3619.52 3623.11 4657.85 6258.40 7709.38

Liabilities Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr.

Shareholders Funds

Equity ShareCapital

124.40 124.40 124.49 124.49 124.49

Share CapitalSuspense

- 0.09 - - -

Employees Stock OptionOutstanding

0.77 1.68

Reserves andSurplus

942.73 913.78 1639.29 2571.73 3475.93

Loan Funds 1531.38 1451.83 1578.63 1740.50 2141.63Deferred Tax

Liabilities

581.71 576.96 560.26 542.35 722.93

Current LiabilitiesCreditors 224.67 318.13 463.99 776.79 723.09OtherCurrentLiab./Prov.

214.63 237.92 291.19 501.77 519.63

Balance Sheet

sTotal

3619.52 3623.11 4657.85 6258.40 7709.38


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SUMMARISED P&LACCOUNTAs On

31-Mar-05 31-Mar-06 31-Mar-07 31-Mar-08 31-Mar-09

Net Sales 2,681.05 3,299.45 4,910.83 5,509.22 6,383.08

Operatingprofit (PBIDT) 272.81 554.26 1,417.81 1,720.06 1,760.29

PBIT 51.03 338.23 1191.56 1482.83 1437.29Gross profit

(PBDT)

188.18 501.62 1392.44 1744.24 1684.46

PBT 43.24 285.59 1166.19 1507.01 1361.46PAT( net

profit)

2.85 229.76 782.28 1,007.61 977.02

DIVIDENDAs On

31-Mar-05 31-Mar-06 31-Mar-07 31-Mar-08 31-Mar-09

Equity

dividend

9.33 21.79 49.79 62.24 62.24

Preference

dividend

- - - - -


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RATIO OF ULTRATECH CEMENT LIMITEDLIQUIDITY RATIOS:The two liquidity ratios, the current ratio and the acid test ratio, are the most important ratios inalmost the whole of ratio analysis and they are also the simplest to use. Liquidity ratios provideinformation about a firms ability to meet its short- term financial obligations. They are of particular

interest to those extending short term credit to the firm. Two frequently-used liquidity ratios arecurrent and quick ratio.While liquidity ratios are most helpful for short-term creditors/suppliers and bankers, they are alsoimportant to financial managers who must meet obligations to suppliers of credit and variousgovernment agencies. A company's ability to turn short-term assets into cash to cover debts is of theutmost importance when creditors are seeking payment. Bankruptcy analysts and mortgageoriginators frequently use the liquidity ratios to determine whether a company will be able tocontinue as a going concern. A complete liquidity ratio analysis can help uncover weaknesses in thefinancial position of the business. Generally, the higher the value of the ratio, the larger the margin ofsafety that the company possesses to cover short-term debts.1. CURRENT RATIO:C

urrent Ratio =C

urrent Asset/current liabilities

SWOT ANANLYSIS OF RADIO

INDUSTRY

Strengths:


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Recently, the government has agreed upon revenue-sharing

model, which is 4 % for the growth of the radio stations. So that they can develop

themselves well because this industry is still in an introduction stage.

The success of private FM stations, and reveals that radiolistenership habits have changed considerably; not only are listeners tuning into it more

often but also sticking to radio for longer hours everyday.

The advertisers, who would depend on word-of-mouth,

pamphlets, brochures or ads in local supplements of newspapers, are welcoming the

opportunity.

Radio is considered as a background medium, because people canlisten to radio anytime and anywhere they want. It is also a free medium.

90% of India has access to radio which is unmatched by any other

media.

Strengths:

Recently, the government has agreed upon revenue-sharing

model, which is 4 % for the growth of the radio stations. So that they can develop

themselves well because this industry is still in an introduction stage.

The success of private FM stations, and reveals that radio

listenership habits have changed considerably; not only are listeners tuning into it more

often but also sticking to radio for longer hours everyday.

--[endif]-->

The advertisers, who would depend on word-of-mouth,

pamphlets, brochures or ads in local supplements of newspapers, are welcoming the

opportunity.


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Radio is considered as a background medium, because people can

listen to radio anytime and anywhere they want. It is also a free medium.

90% of India has access to radio which is unmatched by any other

media.

Weakness:

y One of the major weaknesses of Radio is that there is very less differentiation in theprogrammes that are aired. Most of the stations plays much of the music that is playedconsist of Hindi Film songs, and therefore it is difficult to differentiate between theprogrammes of the different channels.

y Fragmented Audience the large number of the audience in India is fragmented invarious remote places. And therefore, the percentage of listener tuned to anyone station is

likely very small.y No proper research available research is very important for any advertising segment.

Research is the main base to attract client and get more revenue. But, in India there is noproper research is available. Many stations are conducting their own research which canbe biased.

y Radio-only nature of radio communication is a tremendous creative compromise. Anadvertiser whose product depends on demonstration or visual impact is at a loss when itcomes to radio. And like its radio message creates a fleeting impression that is often gonein an instant. Many advertisers think that without strong visual brand identification themedium can play little or no role in their advertising plans.

y Increase in listenership numbers but no increase in ad revenue. This is the situation that

every radio channel is facing.y Short commercials

Opportunities:

y Getting copyright licenses from the government for running mega events which are airedon the AIR radio station and have been restricted to be aired on other private stations.

y Launching a radio station with 24-hour news channely Tie-ups with BEST or railway authority for playing the FM in train and in bus.y The launch of Private Radio FM has managed to create a set of New Listeners for

the mediumy The new radio stations which will come in future they can have venture with the college

or university campuses. And can play their station which will exclusively provide withthe information relating to that university/college campus.

y With the coming of the many more new players in the radio industry each channels can position themselves quite different from others, like, if some station is targeting thehealth conscious people then their programming strategy will vary accordingly. And thenit is easier for the advertisers also to decide on which channel to advertise.


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y Allowing private FM players to start news and current affairs programmes.y One has to constantly innovate, and that is the challenge. Brand building is thus much

more difficult. At the same time, we are very bullish, and gung-ho about this wholeenterprise.

y Leaves huge scope for innovation in local market

Threats:

y The biggest threat to private radio industry players is ALL INDIA RADIO. AIR is thebiggest player in India because of its reach, low charges, government channel etc

y Because of the new government policies there will be more number of stations and thencompetition will also increase. This is one of the biggest threats it faces. With noparticular differentiation in the music. So, there is a fear of losing its brand loyalty.

pr on radio mantrar

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