Financial Management Project SMBA-09 Name of the StudentRoll nos. Ashwini Rajeshirke20 Archita Jadia8 Haseeb Tisekar19 Durgesh D Lingarkar30 Shailesh Singh21 Janardhan G Kamath27 Ankita M Chokshi31 Pratik J Harsora32 Haresh Jain37 Soniya Jain39 Vaibhav Patel44

Company Overview Pioneer in the consumer and industrial specialty chemicals business in India High market share and strong position in most products and segments Operations in 8 countries with manufacturing facilities Brand "Fevicol" ranked as # 1 Household care brand by Brand Equity in Pidilite ranked as # 1 company in chemical segment by Business Today (2009) Consistent growth in sales, profits and dividend payout

GROWTH

Consistent Dividend Payout Dividend Payout = Dividend / PAT 39.7% 36.9% 27.5% 35.4% 30.2% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% Dividend Payout Ratio

FINANCIAL ANALYSIS STOCK WATCH DIRECTORS REPORT COMMON SIZE STATEMENT CAPITAL STRUCTURE CONTINGENT LIABILITIES RATIO ANALYSIS

Stock Watch The overall high has been in the month of Bonus Issue i.e March 2010

Performance vis BSE sensex

DIRECTOR’S REPORT (YEAR ENDED ) The Board reported about the expansion of the adhesives manufacturing capacities at Kalamb in Himachal Pradesh and Daman. A drive in improving performance through greater involvement and participation of employees was initiated during the year at the manufacturing units. The Board updated about the Synthetic Elastomer Project which is a Monomer and Polymer Plant. The report highlighted on the Term Finances, Capital Expenditure and amount raised by the company through issue of Foreign Currency Convertible Bonds Subsidiaries performance has also been outlined in the Board’s Report. The Board is positive about the Sales Growth in the Current Year. However margins will be under pressure due to significant increase in inputs costs The Board’s Report is followed by Corporate Social Responsibility Report which highlights the new initiatives taken by the company in the areas of health care, education and rural development..

Pidilite Industries Limited COMMON SIZE BALANCE SHEET % % % (Rs in million) Balance Sheet SOURCES OF FUNDS Shareholders’ Funds Share Capital Reserves and Surplus Loan Funds Secured Loans Unsecured Loans Deferred Tax Liability (Net) TOTAL APPLICATION OF FUNDS Fixed Assets Gross Block Less: Accumulated Depreciation/Amortisation Net Block Capital Work in Progress Investments Current Assets, Loans and Advances Inventories Sundry Debtors Cash and Bank Balances Other Current Assets Loans and Advances Less: Current Liabilities and Provisions Current Liabilities Provisions N et Current Assets TOTAL The Company relies more on internal sources than on borrwed funds.Also Reserves have increased and borrowings decreased Gross Block of Fixed Assets has increased Investments have increased tremendously Current Assets have decreased as % as well as absolutely whereas Current liablitiea have increased % as well as absolutely

COMMON SIZE INCOME STATEMENT (Rs. in millions) % % % INCOME Turnover : Gross20, , Less:Excise Duty , Sales:(Net)19, , Other Income EXPENDITURE Materials Other Expenses Depreciation Profit before tax3, , , Income Tax Expenses Current tax Less: MAT Credit Entitlement Deferred Tax Fringe Benefi t Tax Total Tax Expense Profit for the year2, , , Prior year Tax Provision written back (Net) Balance brought forward from previous year Profit available for appropriation3, , Appropriations: Dividend on Preference Share Capital Proposed dividend on Equity Share Capital Corporate Tax on dividend Transfer to Capital Redemption Reserve Transfer to Debenture Redemption Reserve Transfer to General Reserve1, Balance carried to Balance Sheet1, Earnings per share: Basic (Rs) Diluted (Rs) Face Value of Share (Re)1 1 1 Increase in Turnover Almost more than 50% of Sales is Materials Expenses Profit which had fallen in 2009 has rised in 2010 also it is 14 % of Sales Company is consitent in Dividend Payment EPS is on enhanced capital base

SHARE CAPITAL The Authorised Capital of the Company as on 31 st March 2010 is Rs. 70,00,00,000 divided into 70,00,00,000 equity shares of Re.1 each. The Issued Subscribed & Paid up Capital of the Company is Rs.50,61,34,612 divided into 50,61,34,612 equity shares of Re.1 each. As can be seen the Authorised as well as Paid up capital has increased pursuant to Bonus Issue of 1:1. Capital Structure from the period 1989 to 2009 is seen below.

Contingent liabilities not provided for: As at 31st March 2010 (Rs. In millions) As at 31st March 2009 (Rs. In millions) As at 31st March 2008 (Rs. In millions) i Guarantees given by Banks in favour of Government and others iiGuarantees given by Company Iii Disputed liabilities in respect of Income Tax, Sales Tax, Central Excise and Customs (under appeal)* iv Claims against the company not acknowledged as debts CONTINGENT LIABILITIES & DUES *Tax dues as mentioned in Auditors Report for the year ended 31 st March 2010

RATIO ANALYSIS

CONCLUSION The financial analysis of the company can be summarized as follows: The sales growth of the company is on the rise. The profitability of the Company significantly improved in the current year due to lower material costs, strengthening of Indian rupee, lower duties and control on costs. Sales growth picked up in the second half of the year, due to improved economic conditions. The share prices of the company have also almost doubled vis-à-vis last year. The Operating Profit and Net Profit, for the year at Rs.4132 million and Rs.2891 million increased by 60% and 97% respectively. The Total Assets of the company are comparatively lower than its competitors.The company should consider competitors financials and map its future planning. The stake holders have benefited with the Bonus issue and dividend payment. Company should give attention to its increasing liabilities and inventories. The working capital of the company had decreased considerably. The short term liquidity position of the company is area of concern.

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