Comparative Analysis of Prism Cement Ltd With JK Cement Ltd

Chapter 1

Introduction

1.1 Overview- Ratios

1.2 Companies for Analysis

1.3 Objective & Scope of Research

Study

1.4 Limitation of Study

1.5 Research Methodology

omparative analysis is an important tool of analyzing and evaluating the performance and

prospects of a firm. The analysis and interpretation of financial statements is used to

determine the financial position and results of operations a well. Financial statements are

prepared primarily for decision-making. They play a dominant role in setting the framework of

managerial decisions. But the information provided in the financial statements is not an end in

itself as no meaningful conclusions can be drawn from these statements alone.

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However, the information provided in the financial statements is of immense use in making

decisions through analysis and interpretation of financial statements. Financial analysis is ‘the

process of identifying the financial strengths and weaknesses of the firm by properly

establishing relationship between the items of the balance sheet and the profit and loss

account.’

1.1 Ratios

The most prevalent method of comparative analysis is through ratio analysis. The ratio analysis

can be for a single year or it may extend to more than one year. The ratios can also be

compared with similar ratios of others concerns to make a comparative study.

First, all ratios will be worked out for each year and each set of comparable items.

The ratios worked out will be put in the context of a trend over several years.

They will be compared with similar companies/ standard ratios.

i. For the year concerned, and

ii. Over a period of time.

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Types of Ratio

1. Liquidity Ratio

i). Current Ratio

The ratio is worked out by dividing the current assets of the concern by its current liabilities.

Current ratios indicate the relation between current assets and current liabilities. Current

liabilities represent the immediate financial obligations of the company. Current assets are the

sources of repayment of current liabilities. Therefore, the ratio measures the capacity of the

company to meet financial obligation as and when they arise. Textbooks claim a ratio of 1.5 to 2

is ideal; bit in practice this is rarely achieved. This ratio is also known as working capital ratio.

ii). Acid Test Ratio

Quick assets represent current assets excluding stock and prepaid expenses. Stock is excluded

because it is not immediately realizable in cash. Prepaid expenses are excluded because they

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Figure 1 Functional Classification

cannot be realized in cash. A minimum of 1: 1 is expected which indicates that the concern can

fully meet its financial obligations. This also called as Liquid ratio or Quick ratio.

2. Activity Ratios

i). Debtors Turnover Ratio

The ratio obtained should be compared with that of other similar units. If the ratio of the

company being studied is greater (say, 10 weeks as against 6 weeks for the industry), it

indicates that the company is allowing longer than the usual credit periods. This may be

justified in the case of new companies or existing companies entering into new ventures

ii). Creditors Turnover Ratio

This ratio shows how frequently company is paying to its creditor. Usually, higher the ratio-

betters the performance of company.

iii). Inventory Turnover Ratio

The ratio is usually expressed as number of times the stock has turned over. Inventory

management forms the crucial part of working capital management. As a major portion of the

bank advance is for the holding of inventory, a study of the adequacy of abundance of the

stocks held by the company in relation to its production needs requires to be made carefully by

the bank.

iv). Fixed Assets Turnover Ratio

The ratio shows the efficiency of the concern in using its fixed assets. Higher ratios indicate

higher efficiency because every rupee invested in fixed assets generates higher sales. A lower

ratio may indicate inefficiency of assets. It may also be indicative of under utilizations or non-

utilization of certain assets. Thus with the help of this ratio, it is possible to identify such

underlined or unutilized assets and arrange for their disposal.

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3. Leverage Ratio

i). Debt-Equity Ratio

Also known as external - Internal equity ratio is calculated to measure the relative claims of

outsiders against the firm’s assets. This ratio indicates the relationship between the external

equities or the equities or the outsider’s funds and the internal equities or the shareholder’s

funds.

ii). Interest Coverage Ratio

Higher the ratio better is the coverage. The firm may not fail on its commitments to pay interest

even if profits fall substantially.

4. Profitability Ratios

i). Gross Profit Ratio

A comparison with the standard ratio for the industry will reveal a picture of the profitability of

the concern. Also the ratio may be worked out for a few years and compared to verify if a

steady ratio is maintained.

ii). Net Profit Ratio

This ratio serves a similar purpose as, and is used in conjunction with, the gross profit ratio.

iii). Return on Assets

This ratio measures the profits of the concern as a percentage of the total assets. For the

purpose of this ratio, the operating profit is calculated by adding back to net profit: (1) Interest

paid on the long term borrowings and debentures; (2) Abnormal and non-recurring losses; (3)

Intangible assets written off. Similarly, from the net profit abnormal and non-recurring gains are

deducted. The idea is to get profit generated out of total investments made.

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iv). Earning Power

Earning power is a measure of business performance which is not affected by interest charges

and tax burden. It abstracts away the effect of capital structure and tax factor and focuses on

operating performance. Hence it is eminently suited for inter-firm comparison. Further, it is

internally consistent. The numerator represents a measure of pre-tax earnings belonging to all

sources of finance and the denominator represents total financing.

v). Return on Capital Employed

ROCE is the post-tax version of earning power. It considers the effect of taxation, but not the

capital structure. It is internally consistent. Its merit is that it is defined in such a way that it can

be compared directly with the post-tax weighted average cost of capital of the firm.

vi). Return on Equity

The return on equity measures the profitability of equity funds invested in the firm. It is

regarded as a very important measure because it reflects the productivity of the ownership

capital employed in the firm.

5. Valuation Ratios

Valuation ratios indicate how the equity stock of the company is assessed in the capital market.

Since the market value of equity reflects the combined influence of risk and return, valuation

ratios are the most comprehensive measures of a firm’s performance.

i). Price Earnings Ratio

The PE Ratio is a summary measure which primarily reflects the following factors: growth,

prospects, risk-characteristics, shareholder orientation, corporate image, and degree of

liquidity.

ii). EV-EBIDTA Ratio

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EV is the sum of the market value of equity and the market value of debt. The market value of

equity is simply the number of outstanding equity shares times the price per share. As far as

debt is concerned, if it is in the form of loans, its market value has to be imputed. Generally, a

rupee of loan is deemed to have a rupee of market value.

EV-EBIDTA is supposed to reflect profitability, growth, risk, liquidity and corporate image.

1.2 Companies for Comparative Analysis

Being a management trainee of Prism Cement Ltd, it is a comparative analysis of Prism Cement

Ltd with JK Cement Ltd. Before going on deep, here is company profile in brief.

1.2.i. Prism Cement Ltd

Prism Cement Ltd. Is an ISO 9001:2000 certified professionally managed company promoted by

the Rajan Raheja Group. The company operates one of the largest single kiln cement plants in

the country at Satna, Madhya Pradesh. The company has also a packing unit at Allahabad, Uttar

Pradesh equipped with machinery and technical support from world leaders, F.L. Smidth & CO.

A/S, Denmark, Prism has created a niche for itself in the cement industry.

The company primarily caters to the demand in the Northern Region mainly in the state of

Uttar Pradesh, Bihar & Madhya Pradesh. The company plan for a five-fold increase in cement

capacity from 2 MTPA to 10.0 MTPA by 2011 through Brownfield and Greenfield expansion is

making steady headway. These expansions will establish the company brand in new markets

and a larger customer base.

A team of experienced engineers and a dedicated workforce combined with the high level of

automation and sophisticated control system have placed the company product in the premium

segment.

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Prism has successfully established a high brand preference amongst its customer through its

excellent quality products and transparent policy. Prism has truly taken cement production to

global standards.

Review of operation and future outlook

Production of clinker and cement registered a growth of 5.45% and 9.20%, respectively.

Sales of cement and clinker increased from 26.93 Lakh tones during the year 2006-07 to

30.64 lakh tones during the year 2007-08, an increase of 13.78%.

Revenues increased by 15.42% to Rs. 1019.75 Crores during the year under review from

Rs. 883.48 Crores during the previous year.

PAT for the year ended June 30, 2008 at Rs. 241.63 Crores, was higher by Rs. 48.86

Crores, registering a increase of 25%

Power consumption down by 5.75% to 68.08 unit’s ksh per ton cement.

1.2.ii. JK Cement Ltd

J.K. Cement is an affiliate of the J.K. Organization, which was founded by Lala Kamlapat

Singhania. The J.K. Organization is an association of industrial and commercial companies and

has operations in a broad number of industries.

JK cement operations commenced commercial production in May 1975 at its first plant at

Nimbahera in the state of Rajasthan. At Nimbahera, it started with a single kiln with a

production capacity of 0.3 million tons. JK Cement Ltd added a second kiln in 1979 with

production capacity of 0.42 million tons, and a third kiln in 1982 with a production capacity of

0.42 million tons. They added a precalciner with a capacity of 0.4 million tons in 1988, which

increased their capacity at Nimbahera to 1.54 million tons. During the years 1998 through 2003,

it continued to implement modifications to each of their kilns, which increased their aggregate

capacity at Nimbahera to 2.8 million tons as of September 30, 2005.

JK commissioned a second grey cement plant at Mangrol plant in 2001, with a production

capacity of 0.75 million tons. As of September 30, 2005, it had an aggregate production capacity

of 3.55 million tons per annum of grey cement. JK white cement plant was completed in 1984

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with a capacity of 50,000 tons. Their continuing modifications to the plant have increased its

production capacity to 300,000 tons as of September 30, 2005.

Today, J. K. Cement Ltd. is one of the largest cement manufacturers in Northern India. They are

also the second largest white cement manufacturer in India by production capacity. While the

grey cement is primarily sold in the northern India market, the white cement enjoys demand in

the export market including countries like South Africa, Nigeria, Singapore, Bahrain,

Bangladesh, Sri Lanka, Kenya, Tanzania, UAE and Nepal.

Their access to high quality limestone reserves that are suitable for production of white cement

provides them with a competitive advantage. Based on geological surveys conducted by

independent agencies on their mines between 1996 and 2001, their limestone reserves for

both grey and white cement are expected to meet their existing and planned limestone

requirements of 4.0 MnTPA of grey cement and 0.4 MnTPA of white cement, for approximately

40 years.

Backed by state-of-the-art technology and highly skilled manpower against the backdrop of

India’s infrastructural growth in an overdrive, they are upbeat about the future. They are

confident of contributing heavily in India’s journey of development. They see a world of

concrete ideas on the horizon.

1.3. Objective & Scope of Study

The study deals in brief to evaluate and analyze various aspects of company’s financial position,

liquidity position, and long term solvency position, so as to present a clear picture of

performance. This study is only based on Annual reports of company, by comparing the ratios

of last 5 years. A study like this will help the organization to make decisions based on the

current performance. This study also groomed me as I interacted with more industry people

and also gave me a good industry exposure. The study will also help Prism Cement Ltd to

increase its efficiency by finding out its Strongest & Weakest points. This study focus on

comparative analysis & ratio analysis of Prism cement Ltd with JK Cement Ltd. Main objective of

this research are as follows-

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To find out the company solvency position in long term that which company is

more solvent and able to pay its long term liabilities in time.

To find out debt-equity mix in capital structure of company, its financial

leverage, its external and internal liability, etc. This will help to find out that

which company is opting optimum capital structure as per nature of its business.

To find out the profitability position of the company, their GP Margin, NP margin,

Earning Power, etc.

To find out the short term solvency position of company i.e. Liquidity, current

ratio, working capital ratio, etc. This will help to find out the ability of firm to

meet its current liabilities, and perform day to day operation.

To find out the benefits provided by company to its shareholders, Earning per

share, Dividend Declared, corporate social responsibilities, etc.

1.4. Limitation of the Study:

Limitations are difficulty faced or can be face while doing study. These can be normal

limitation like- budget constraints, time constraint which are common for every project.

Because time and money are always limited and we cannot spend in huge amount. So this is

first constraint to finish study in time and within budget.

Apart from these limitations other are- Technical Limitation. These limitations are related

with constraint of tool or method used for analysis. As this is project is totally based on

secondary data. So the main limitation which can be faced are:

Study is only based on annual report of company, which is not sufficient to compare

performance & efficiency of company.

Information available in annual report is also altered, which is not so accurate.

1.5. Research Methodology

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Type of Data: - There are two types of data: Primary Data and Secondary Data. Primary data are

those data which are collected first time, to meet the objective of research only. Secondary

data is data which has been already used for any other purpose and can be used for this

research. As this study is based on financial statements of companies, means Secondary Data.

Method of Data collection: - For collecting secondary data, Annual report of company will use

as well as financial reports available on various stock market websites.

Data Analysis & Interpretation: - Collected data will we present with the help of-

o Table- To represent data in tabular form. It is easy to analyse data and make

some conclusion

o Bar graph- Use to present data in chart or graph form. It is best way to

present data.

o Ratios- A tool for analysis. This is normally used by manager to make

interpretation.

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12

Chapter 2

Prism Cement Ltd

&

JK Cement Ltd

2.1.0 Prism Cement Ltd

2.1.1 Company Vision & Mission

2.1.2 Features

2.1.3 Corporate Social Responsibility

2.1.4 Current Performance

2.2.0 JK Cement Ltd

2.2.1 Plants


rism Cement Ltd and JK Cement Ltd, both are player of cement industry. Both the

companies are targeting Northern region of our country. Although JK cement is major

player as compare to Prism Cement Ltd because it is operating from last 34 years, on the other

hand Prism Cement Ltd is operating from only 15 years. But Prism has performed very well and

achieved milestones in very less time. For this research study we are considering the

performance of last four financial years of both the company. Before analyzing their

performance let’s see the company important aspects in deep.

P

2.1.0 Prism Cement Ltd

Prism Cement Ltd. Is an ISO 9001:2000 certified professionally managed company promoted by

the Rajan Raheja Group. The company operates one of the largest single kiln cement plants in

the country at Satna, Madhya Pradesh. The company has also a packing unit at Allahabad, Uttar

Pradesh equipped with machinery and technical support from world leaders, F.L. Smidth & CO.

A/S, Denmark, Prism has created a niche for itself in the cement industry.

The company primarily caters to the demand in the Northern Region mainly in the state of Uttar

Pradesh, Bihar & Madhya Pradesh. The company plan for a five-fold increase in cement capacity from 2

MTPA to 10.0 MTPA by 2011 through Brownfield and Greenfield expansion is making steady headway.

These expansions will establish the company brand in new markets and a larger customer base.

2.1.1 Vision & Mission

Vision

“To be acknowledged as a leading player in the industry with the highest level of integrity.”

Mission:-

State of the art cement plants

Transparent dealings with all stakeholders

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Committed to the principles of good corporate governance

2.1.2. Features

The entire cement manufacturing process at all prism cement plant represents the latest

relevant state-of-the-art technology.

Our all plant equipment are supplied by M/S F.L. Smidth & Co., Denmark and its

subsidiaries, Ventomatic; Krupp Industries Ltd., ABB, Seimens and Crompton Greaves.

Computerized mining activities using three dimensional imaging for optimum blending

of raw material.

The vertical roller press mill for efficient grinding of raw meal.

Six stage low pressure drop pre-heater for lower power consumption.

Online computerized quality control by x-ray spectrometer to ensure raw meal control

and consistency from raw meal to final product cement.

Fuzzy logic control for kiln and cement mill to ensure instantaneous corrective response

through computer based control system.

A Combination of roller press and ball mill for improved finish grinding of cement

Quality grinding through closed circuit grinding system

Pollution control system e.g. ESP and bag filters for all plant building to meet stringent

pollution control requirement.

All electronic packers each capable of packing accurately 120 MT of finished cement per

hour.

Automatic truck loader each capable of loading 15 MT of cement in 10 minutes.

Wagon loaders each capable of loading one full rake in 5 hours.

Total self reliance in power requirement through DG sets


For prism, corporate social responsibility is not just a program but it is the way business is done

every day. The company has always been conscious of its social obligation and has initiated

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welfare programmes for the benefit of its employees and villagers living near the plant by

providing the basic facilities and a better way of living, right from its inception.

Besides providing emergency and basic medical facilities to its employees and contractors and

their families at the plan, a mobile medical van provides free medical aid to the villagers and

their families.

Operations of a cement plant have inherent potential to emit dust and gases that may affect air

quality negatively. At prism, the installation of pollution control equipment of international

standard are in place to improve air quality at and around the operations.

Water management and water quality remain the key focus areas of the management. The

quality of both surface and ground ware is monitored regularly to ensure that the mining and

plant operations do not pollutes the water resources of the communities living around the

mining and plant area.

In recognition of the above, the company was awarded the energy conservation award by the

government of India, ministry of power for the year 2006. The company was also awarded the

1st prize for environment management by the government of Madhya Pradesh, ministry of

environment announced in 2007.

2.1.4 Current Performance

Prism cement posted a profit after tax (PAT) of Rs. 2.42 billion for the year ended June 30, 2008

as against Rs. 1.93 billion for the previous year ended June 30, 2007 registering a growth of

25%.

Sales grew 15% from Rs. 8.83 billion to Rs. 10.2 billion in the same period crossing the Rs. 10

billion mark for the first time. The company is debt-free and has liquid investment of over Rs.

2.51 billion as on June 30, 2008.

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The significant growth in net profits is driven by increase in sales volume. Improve realizations

and reduced finance charges, despite increase in input costs. Blended cement contributed to

87% of sales, the company said in a release.

The company caters mainly to markets of eastern UP, North Eastern MP and western Bihar

which are within the radius of 360 km of its plant at Satna, MP.

The company has the highest quality standards due to modern plant with automated controls.

The strength and other characteristics of its cement are much higher than the BIS requirement.

2.2.0 JK Cement Ltd

JK Cement Limited engages in the manufacture and trade of cement and related products

primarily in India. It produces grey and white cement, as well as white cement based Wall Putty

and JK Water Proof cement. The company’s grey cement consists of ordinary Portland cement

(OPC) and Portland pozzolana cement (PPC). It markets OPC products under the brand names

J.K. Cement and Sarvashaktiman; PPC products under J.K. Super; and white cement products

under J.K. White and Camel. The company also involves in the generation of electricity through

its waste heat recovery plant. JK Cement Limited exports white cement to South Africa, Nigeria,

Singapore, Bahrain, Bangladesh, Sri Lanka, Kenya, Tanzania, the United Arab Emirates, and

Nepal. The company was founded in 1975 and is based in Kanpur, India.

2.2.1 Plants

JK Cement manufactures grey cement in two facilities located at Nimbahera and Mangrol in the

state of Rajasthan in Northern India. White cement is produced at our facility at Gotan in the

state of Rajasthan. Our plants have obtained many accolades and recognition, the most

noteworthy being : ISO-9001:2000 QMS and ISO-14001:2004 EMS for the grey cement facility at

Nimbahera and ISO-9001:2000 QMS, ISO-14001:1998 EMS & OHSAS-18001:2005 Occupational

Health and Safety for the white cement facility at Gotan. The construction of our first most

modern dry cement plant began in 1970 in Nimbahera in Rajasthan.

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The following table shows a breakdown of production of the Nimbahera, Mangrol and Gotan

cement facilities for the periods indicated


JK Cements has performed various activities to build its image as well as fulfill its corporate

social responsibility. Some important ones are as follows.

Concrete Road with proper drainage system at Gotan village

Sponsorship of annual Eye camps at Gotan

Street Light for Gotan village

Tree plantation along the road leading to Gotan

Organizing Social event for residents of Local area

Funding & Technical support for Infrastructure projects of Local Community

Tube Well – to provide drinking water for villagers

Temple (Renovation of two old temples)

Dharamshala (Inn) at Gotan Village

Free education to the wards of Kargil war heroes

Free bus service for students of nearby villages

Building for girls school at Gotan village

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18

Chapter 3

Performance Analysis of

Prism Cement Ltd with

JK Cement Ld

3.1 Balance Sheet of Companies

3.2 P&L of Companies

3.3 Ratio Analysis & Interpretation

inancial statements are an important source of information for evaluating the performance and

prospects of a firm. If properly analyzed and interpreted, financial statements can provide valuable

insights into a firm’s performance. Financial statement analysis may be done for a variety of purposes,

which may range from a simple analysis of the short-term liquidity position of the firm to a

comprehensive assessment of the strengths and weaknesses of the firm in various areas.

F

3.1 Balance Sheet of Companies

The balance sheet shows the financial condition of a business at a given point of time. As per

the Companies Act, the balance sheet of a company shall be in either the account form or the

report form. Table 3.1 shows balance sheet of Prism Cement Ltd & Table 3.2 shows balance

sheet of JK Cement Ltd.

3.2 P&L of Companies

Profit & Loss account also known as income statement of a company, depicts all the

information regarding Income and expenditure of company. Table 3.3 shows P&L of Prism

Cement Ltd and Table 3.4 shows P&L of JK Cement Ltd.

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Prism Cement Ltd (Balance Sheet) Accounting Period (Rs. In Lacs)

2005-06 2006-07 2007-08 2008-09

Sources of Fund

Shareholder’s Fund

Capital 298.25 298.25 298.25 298.25

Reserve & Surplus -44.90 112.97 319.52 363.40

253.35 411.22 617.77 661.65

Loan Fund

Secured Loan 100.27 0.00 0.00 0.00

Unsecured Loan 7.66 0.00 0.00 0.00

107.93 0.00 0.00 0.00

Deferred Tax Liability -2.30 64.57 58.77 52.77

Total 358.98 475.79 676.54 714.42

Application Of Fund

Fixed Assets

Gross Block 602.86 647.05 702.95 733.39

Less: Depreciation 254.38 286.11 317.43 340.69

Net Block 348.48 360.94 385.52 392.70

Capital Work in Progress 7.96 2.00 17.96 109.16

356.44 362.94 403.48 501.86

Investment 0.00 141.87 258.76 203.81

Current Assets, Loan & Advances

Inventories 61.78 85.22 90.35 76.90

Sundry Debtors 14.55 3.57 3.38 0.00

Cash & Bank Balance 16.91 11.04 12.97 25.87

Other Current Assets 0.00 0.00 0.00 0.00

Loan & Advances 29.43 44.63 55.82 65.89

122.67 144.46 162.52 168.66

Less: Current Liabilities & Provision

Liabilities 116.57 132.95 124.67 109.82

Provision 5.43 40.53 23.55 50.09

122.00 173.48 148.22 159.91

Net Current Assets 0.67 -29.02 14.30 8.75

Miscellaneous Expenditure

Preliminary Expenses 0.00 0.00 0.00 0.00

Deferred Revenue Expenditure 1.87 1.87 0.00 0.00 0.00 0.00 0.00 0.00

Total 358.98 475.79 676.54 714.42

Table 3.1 Balance Sheet of Prism Cement Ltd

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JK Cement Ltd (Balance Sheet) Accounting Period (Rs. In Lacs)

2005-06 2006-07 2007-08 2008-09

Sources of Fund

Shareholder’s Fund

Capital 69.93 69.93 69.93 69.93

Reserve & Surplus 604.35 750.18 983.41 1,116.13

674.27 820.11 1,053.34 1,186.06

Loan Fund

Secured Loan 443.14 429.94 382.79 436.86

Unsecured Loan 139.02 127.77 127.74 127.54

582.16 557.71 510.53 564.40

Deferred Tax Liability 17.40 43.19 50.99 100.60

Total 1,273.83 1,421.01 1,614.86 1,851.06

Application Of Fund

Fixed Assets

Gross Block 959.20 1,029.42 1,249.77 1,441.15

Less: Depreciation 61.21 106.98 160.63 225.40

Net Block 897.99 922.44 1,089.13 1,215.75

Capital Work in Progress 56.90 164.39 133.84 35.06

954.89 1,086.83 1,222.97 1,250.81

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Investment 0.00 15.91 9.50 10.74

Current Assets, Loan & Advances

Inventories 83.98 110.01 114.53 136.13

Sundry Debtors 46.13 62.16 57.26 53.04

Cash & Bank Balance 285.42 192.54 145.44 125.20

Other Current Assets 1.20 1.29 1.33 1.32

Loan & Advances 92.67 165.10 352.50 581.49

509.39 531.09 671.06 897.17

Less: Current Liabilities & Provision

Liabilities 179.70 172.85 238.63 266.37

Provision 12.65 41.72 52.01 43.74

192.35 214.57 290.64 310.11

Net Current Assets 317.04 316.52 380.42 587.07

Miscellaneous Expenditure

Preliminary Expenses 0.13 0.08 0.04 0.00

Deferred Revenue Expenditure 1.78 1.90 1.66 1.74 1.92 1.96 2.44 2.44

Total 1,273.83 1,421.01 1,614.86 1,851.06

Table 3.2 Balance Sheet of JK Cement Ltd

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Prism Cement P&L

2005-06 2006-07 2007-08 2008-09

Income

Gross Sales 678.18 883.48 1,019.75 721.41

Less: Excise Duty 106.44 116.68 143.30 94.17

Net Sales 571.74 766.80 876.45 627.24

Other Income -1.87 4.62 15.92 9.93

Total 569.87 771.42 892.37 637.17

Expenditure

Manufacturing Expenses 301.54 313.96 382.95 327.57

Personal Expense 19.40 23.88 35.43 27.42

Selling, Administration and other expenses 99.90 420.84 98.91 436.75 121.50 539.88 102.35 457.34

Profit before finance charge & Depreciation 149.03 334.67 352.49 179.83

Interest & Other Charges 18.84 5.80 3.21 3.25

Lease Rental 6.50 25.34 0.81 6.61 0.62 3.83 0.29 3.54

Profit Before Depreciation 123.69 328.06 348.66 176.29

Depreciation 30.73 31.87 31.93 24.31

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Amortization of deferred expenses 2.31 33.04 2.13 34.00 0.00 31.93 0.00 24.31

Profit Before Tax 90.65 294.06 316.73 151.98

Provision for Tax

Current Tax 9.06 34.13 80.41 61.24

Fringe Benefit Tax 0.33 0.29 0.40 0.51

Deferred Tax 19.18 28.57 66.87 101.29 -5.71 75.10 -6.00 55.75

Profit After Tax 62.08 192.77 241.63 96.23

Surplus/Deficit Brought Forward -106.98 -44.90 112.97 319.52

Less: Transitional adjustment for AS-15 0.00 0.00 0.18 0.00

Amount Available for appropriation -44.90 147.87 354.42 415.75

Appropriations

Proposed Dividend 0.00 29.83 0.00 14.92

General Reserve 0.00 0.00 0.00 5.00

Tax on Proposed Dividend 0.00 5.07 0.00 2.53

Interim Dividend 0.00 0.00 29.83 29.83

Tax on Interim Dividend 0.00 0.00 0.00 34.90 5.07 34.90 5.07 57.35

Balance Carried To Balance Sheet -44.90 112.97 319.52 358.40

No. Of Equity Share 29.83 29.83 29.83 29.83

Earning Per Share 2.08 6.46 8.10 3.23

Table 3.3 P&L of Prism Cement Ltd

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JK Cement P&L

2005-06 2006-07 2007-08 2008-09

Income

Gross Sales 1,108.68 1,529.67 1,812.85 1,876.45

Less: Excise Duty 167.51 184.96 218.34 210.95

Sales Tax 67.47 234.98 111.37 296.33 136.26 354.59 168.67 379.62

Net Sales 873.70 1,233.33 1,458.25 1,496.84

Other Income 9.38 10.69 7.86 7.91

Total 883.08 1,244.03 1,466.11 1,504.75

Expenditure

Manufacturing Expenses 455.17 535.85 604.16 659.32

Provision for Employee 41.20 48.84 67.64 83.78

Selling, Administration and other expenses 245.31 319.48 370.80 429.73

Interest 58.17 34.72 35.88 45.53

26

Total 799.85 938.89 1,078.47 1,218.36

Profit Before Depreciation 83.23 305.14 387.64 286.38

Depreciation 43.41 45.95 53.81 65.10

Less: Transfer for Revaluation Reserve 12.39 31.02 12.79 33.16 12.74 41.07 12.68 52.42

Profit Before Tax 52.21 271.98 346.57 233.96

Provision for Tax

Fringe Benefit Tax 1.50 2.00 2.10 1.97

Current Tax 4.34 69.84 71.50 55.68

Deferred Tax 13.80 19.64 21.52 93.37 7.80 81.40 33.97 91.62

Profit After Tax 32.57 178.62 265.17 142.34

Balance From Previous year 6.33 6.94 56.92 31.18

Amount Available for appropriation 38.90 185.56 322.09 173.53

Appropriations

General Reserve 20.00 100.00 150.00 100.00

27

Proposed Dividend 10.49 24.47 34.96 24.47

Corporate Dividend Tax 1.47 31.96 4.16 128.64 5.94 190.91 4.16 128.63

Balance Carried To Balance Sheet 6.94 56.92 131.18 44.89

No. Of Equity Share 5.12 6.99 6.99 6.99

Earning Per Share 6.36 25.54 37.92 20.36

Table 3.4 P&L of JK Cements Ltd

28

3.3 Ratio Analysis & Interpretation

Liquidity Ratio

1. Current Ratio:

Current Ratio=

2005-06 2006-07 2007-08 2008-09

JK Cement 2.65 2.48 2.31 2.89

Prism Cement 1.01 0.83 1.10 1.05

Interpretation: Here JK Cement Ltd current ratio is more than 2 in all cases. As standard for

current ratio is 2:1, so JK Cement is performing well by maintaining proper current assets to

meet its current liability. But on the other hand this also shows that company has lot of blocked

fund, which is not properly utilized, this is not a good sign for company. On contrary Prism

Cement Ltd has its current ratio is similar to 1 in all 4 years. This is also not good for company

health, because, company’s current liabilities are equal to current assets. So, company should

invest more on current assets, for paying all its current liabilities in time, without fail.

Current AssetsCurrent Liabilities

2. Acid Test Ratio:

Acid Test Ratio=

2005-06 2006-07 2007-08 2008-09

JK Cement 2.21 1.96 1.91 2.45

Prism Cement 0.50 0.34 0.49 0.57

Interpretation: Here again JK Cement Ltd. is showing more liquidity because its cash position is

very high. This shows more blocked fund of JK Cement Ltd. On the contrary Prism Cement

Liquidity position is not good, because Prism has maintained very low cash balance and its

major part of current assets is of Inventory.

3. Working Capital to total Assets Ratio

Working Capital to Total Assets Ratio=

2005-06 2006-07 2007-08 2008-09

JK Cement 0.24 0.20 0.21 0.29

Prism Cement 0.00 -0.05 0.02 0.01

2

Quick Assets . Current Liabilities

Working CapitalTotal Assets

Interpretation: Working Capital to Total Assets ratio for JK Cement Ltd is consistent for every

year but for Prism Cement Ltd. it is very fluctuating. Because in 2005-06 it Working Capital was

very low that’s why its WCTA Ratio is 0.002 in 2005-06. In 2006-07 its working capital came to

negative and in 2007-08 and 2008-09 it is near to 0.02 and 0.01 respectively.

4. Retained Earnings to Total Assets Ratio

Retained Earnings to Total Assets Ratio =

2005-06 2006-07 2007-08 2008-09

JK Cement 0.46 0.48 0.56 0.55

Prism Cement -0.19 0.20 0.43 0.43

3

Retained EarningsTotal Assets

DebtEquity

Interpretation: Retained Earnings to Total Assets is a measure of reinvestment of earning. JK

Cement Ltd is maintaining ratio of 0.46 to 0.56 in respective years. But for Prism Cement Ltd. it

is in negative in 2005-06 but become positive in 2006-07, 2007-08 and 2008-09 respectively.

Leverage Ratio

1. Debt-Equity Ratio:

Debt-Equity Ratio=

2005-06 2006-07 2007-08 2008-09

JK Cement 0.86 0.68 0.48 0.48

Prism Cement 0.43 0.00 0.00 0.00

Interpretation: Here both companies are in good position because their debt-equity ratio is less

than 1. In 2005-06 JK Cement Ltd ratios was 0.86 which is now decrease to 0.48. it means

company has redeemed its debt and enjoying its reserves & Surplus for further financing. On

the contrary Prism Cement Ltd. has redeemed all its debt in 2006-07 and using its equity &

reserves for further investment.

4

Earnings Before Interest & TaxInterest

Market Value of EquityTotal Debt

2. Interest Coverage Ratio

Interest Coverage Ratio=

2005-06 2006-07 2007-08 2008-09

JK Cement 1.90 8.83 10.66 6.14

Prism Cement 5.81 51.70 99.67 47.76

Interpretation: Here in 2005-06 interest coverage Ratio of was very low for JK Cement as well

as Prism Cement Ltd because they have to pay more interest due to more debt in capital

structure. From next years, their interest coverage ratio is increased because of lesser debt

fund. For Prism it is almost 100 times in 2007-08 because its debt is totally near to zero so their

interest amount is very less. That is good for company because their fixed liabilities can easily

met by its earning.

3. Market Value of Equity / Total Debt

Market Value of Equity to Total Debt=

2005-06 2006-07 2007-08 2008-09

JK Cement 1.53 1.81 2.23 0.49

Prism Cement 7.72 0.00 0.00 0.00

5

Cost of goods soldAverage Inventory

Average InventoryCost of Goods Sold

X 365

Interpretation: Market Value of Equity to Total Debt ratio is measure of Leverage of company.

For JK Cement Ltd it is constant i.e. 1.53 in 2005-06, 1.81 in 2006-07, 2.23 in 2007-08 and 0.49

in 2008-09. For Prism Cement Ltd. it is very high because Prism finance mainly from equity

financing. In 2006-07 it has redeemed all its debt so debt portion become Zero. That’s why in

2005-06 it is 7.72 but from 2006-07 to 2008-09 it came to infinite because denominator

becomes zero.

Turnover Ratio

1. Inventory Turnover Ratio:

Inventory Turnover Ratios=

2005-06 2006-07 2007-08 2008-09

JK Cement 14.73 15.77 16.15 14.97

Prism Cement 21.95 12.02 11.62 8.63

Inventory Turnover Period (In days) =

2005-06 2006-07 2007-08 2008-09

JK Cement 24.78 23.14 22.60 24.38

6

Prism Cement 16.63 30.37 31.42 31.88

Interpretation: Inventory Turnover Ratio is good for both companies. For JK Cement Ltd. it is

consistent and almost same for all 4 financial year. But for Prism Cement Ltd. it is decreasing in

consequent years. Although, higher the ratio, the more efficient management of inventories

and vice versa. However, this may not always true. A high inventory turnover may be caused by

7

Credit sales during YearAverage Balance of Debtors

Net SalesFixed Assets

a low level of inventory which may result in frequent stock outs and loss of sales and customer

goodwill.

2. Debtor Turnover Ratio

Debtor Turnover Ratio=

2005-06 2006-07 2007-08 2008-09

JK Cement 25.08 28.25 30.36 34.03

Prism Cement 78.59 84.64 252.22 371.15

Interpretation: Here again both companies are showing good performance because higher the

debtor turnover ratio is good for company. For JK Cement Ltd it has ranges from 25 to 34 times

in all four years. It means JK Cement ltd. has adopted consistent credit policy for its debtor. On

the contrary for Prism cement Ltd. it is very rigid policy. They do not provide credit facility for

its customers. Their most of sale is cash sale. That’s why its debtor turnover ratio is

continuously raising.

4. Fixed Assets Turnover Ratio

Fixed Assets Turnover Ratio=

8

Net SalesTotal Assets

2005-06 2006-07 2007-08 2008-09

JK Cement 0.97 1.35 1.45 1.30

Prism Cement 3.28 2.16 2.35 1.61

Interpretation: Here Fixed Assets Turnover Ratio is Higher for Prism Cement Ltd. this indicates a

high degree of efficiency in asset utilization. On the other hand it is very low for JK Cement Ltd.

in 2005-06, but increases in successive years.

5. Total Assets Turnover Ratio

Total Assets Turnover Ratio=

2005-06 2006-07 2007-08 2008-09

JK Cement 0.66 0.80 0.82 0.74

Prism Cement 2.38 1.36 1.19 0.74

9

Gross ProfitNet Sales X 100

Interpretation: Total assets Turnover Ratio is same as Fixed Assets Turnover ratio. Only

difference is that it considers the total asset instead of fixed assets. Here again total Assets

Turnover Ratio is good for Prism Cement Ltd. in Initial Year but it is showing a decreasing trend.

On the other hand it is very low for JK Cement Ltd. showing inefficient employment of assets.

Profitability Ratio

1. Gross Profit Margin

Gross Profit Margin=

2005-06 2006-07 2007-08 2008-09

JK Cement 43% 53% 54% 50%

Prism Cement 44% 56% 52% 43%

10

Net ProfitNet Sales X 100

Profit after TaxAverage Total Assets

X 100

Interpretation: Both the companies are maintaining consistent Gross Profit Margin. JK Cement

Ltd and Prism Cement Ltd both are maintaining almost 50 % Gross Profit in its total sales. In

nutshell we can say that Prism cement Ltd is getting more margin of GP as compare to JK

Cement Ltd. But from 2007-08 onward JK Cement is more efficient in its manufacturing

expenses and start getting more GP Margin as compare to Prism Cement Ltd.

2. Net Profit Margin

Net Profit Margin=

2005-06 2006-07 2007-08 2008-09

JK Cement 4% 14% 18% 10%

Prism Cement 11% 25% 28% 15%

Interpretation: Here both companies are getting lesser Net Profit Margin as compare to GP

Margin. It shows that Cement Industries have lot of administrative expenses because of which

its net profit margin is decreases. In 2005-06 JK Cement Ltd was getting only 4% of sales as Net

Profit. Its net profit increases to 14%, 18% and 10% in successive financial year. For Prism

cement Ltd. it is 14% in 2005-06 and increases to 25%, 28% and 15% respectively in successive

years. Here again Prism Cement Ltd. is performing better than JK Cement Ltd.

3. Return on Assets

11

Profit before interest & TaxAverage Total Assets X 100

Return on Assets=

2005-06 2006-07 2007-08 2008-09

JK Cement 2% 12% 15% 7%

Prism Cement 13% 34% 33% 11%

Interpretation: Return on assets means return on total investment made in current assets as

well as fixed assets. For JK Cement it is very low in 2005-06 i.e. 2%. It increases to 12%, 15% and

then 7% in respective years. For Prism cement Ltd. it is 13% in 2005-06 and increases to 34%,

33% and 11% in respective years.

4. Earning Power

Earning Power=

2005-06 2006-07 2007-08 2008-09

JK Cement 8% 20% 22% 14%

Prism Cement 23% 53% 43% 18%

12

Profit before interest after TaxAverage Total Assets X 100

Equity EarningsAverage Equity X 100

Interpretation: Again in Earning Power also Prism Cement Ltd is performing better then JK

Cement Ltd. Earning Power Ratio is showing increasing trend in 2006-07 and 2007-08 but in

2008-09 again it decreases for both company.

5. Return on Capital Employed

Return on Capital Employed=

2005-06 2006-07 2007-08 2008-09

JK Cement 7% 14% 17% 9%

Prism Cement 34% 35% 33% 12%

Interpretation: For JK Cement Ltd. in 2005-06 Return on capital Employed is 7% and increases

to 14%, 17% and 9% respectively. For Prism Cement Ltd. it is 34%, 35%, 33% and 12% in

respective Year.

6. Return on Equity

13

Earning Available for Equity ShareholderNumber of Outstanding Share

Return on Equity=

2005-06 2006-07 2007-08 2008-09

JK Cement 6% 24% 28% 13%

Prism Cement 25% 58% 47% 15%

Interpretation: Again, in Return for equity share holder, Prism Cement Ltd is giving good return

to its shareholder i.e. 25% in 2005-06, 58% in 2006-07, 47% in 2007-08 and 15% in 2008-09. For

JK Cement Ltd. it is 6% in 2005-06, 24% in 2006-07, 28% in 2007-08 and 13% in 2008-09

respectively.

Earnings Per Share

EPS=

2005-06 2006-07 2007-08 2008-09

JK Cement 6.36 25.54 37.92 20.36

Prism Cement 2.08 6.46 8.10 3.23

14

Market Price per shareEarnings per Share

Interpretation: In case of EPS JK Cement is giving good return as compare to Prism Cement Ltd.

In 2005-06, JK Cement’s EPS is 6.36, 25.54 in 2006-07, 37.92 in 2007-08 and 20.36 in 2008-09.

For Prism Cement Ltd. it is 2.08 in 2005-07, 6.46 in 2006-07, 8.10 in 2007-08 and 3.23 in 2008-

09 respectively.

Valuation Ratio

1. Price Earnings Ratio

Price Earnings Ratio=

2005-06 2006-07 2007-08 2008-09

JK Cement 27.35 5.66 4.30 1.95

Prism Cement 13.43 6.67 4.15 7.05

15

Enterprise Value . Earnings before interest, taxes, depreciation and amortization

Interpretation: High Price-Earnings Ratio show good market return for equity shareholder. In

2005-06 PE Ratio for JK Cement is 27.35 times. It shows that investor see good growth prospect

in future. But from next year onward its PE Ratio is decreased sharply. It is 5.66 in 2006-07, 4.30

in 2007-08 and 1.95 in 2008-09. For Prism Cement Ltd. it is 13.43 in 2005-06, 6.67 in 2006-07,

4.15 in 2007-08 and 7.05 in 2008-09, respectively.

2. EV-EBIDTA Ratio

EV-EBIDTA Ratio=

2005-06 2006-07 2007-08 2008-09JK Cement 9.58 4.45 3.78 2.44Prism Cement 6.71 3.88 2.85 3.78

16

Interpretation: EV-EBIDTA is also a tool to reflect profitability. In 2005-06 JK Cement Ltd was

showing EV-EBIDTA ratio of 9.58 times, which was good indicator for company. But for next

year’s this ratio decreases to 4.45 in 2006-07, 3.78 in 2007-08 and 2.44 in 2008-09. For Prism

Cement Ltd it is 6.71 times in 2005-06, 3.88 in 2006-07, 2.85 in 2007-08 and 3.78 in 2008-09.

Bankruptcy Forecasting

Altman Z-Score

Z = 1.2 X1 + 1.4 X2 + 3.3 X3 + 0.6 X4 + 1.0 X5

Where X1 = Working Capital to Total Assets Ratio

X2 = Retained Earnings to Total Assets

X3 = EBIT to Total Assets

X4 = Market Value of Equity to Book Value of Debt

X5 = Sales to Total Assets

2005-06 2006-07 2007-08 2008-09

JK Cement 2.77 3.46 3.91 2.60

Prism Cement 7.50 3.33 3.25 1.95

17

Interpretation: Here JK Cement Ltd is showing very healthy firm because its ratio is more than

2.99 in all years. For Prism Cement Ltd it is more than JK Cement Ltd but in graph it is showing

decreasing trend because its debt is zero, so, its market value of equity to book value of debt

become zero. Otherwise Prism is very sound company and it doesn’t show any bankruptcy

18

19

Chapter 4

Finding, Suggestion and

Conclusion

1.1 Finding

1.2 Conclusion

1.3 Suggestion

4.1 Finding

Ratio Company 2005-06 2006-07 2007-08 2008-

09

Net Sales JK Cement Ltd 873.70 1233.33 1458.25 1796.84

Prism Cement Ltd. 571.74 766.80 876.45 627.24

Predictor Ratio

Altman Z-Score JK Cement Ltd 2.77 3.46 3.91 2.60

Prism Cement Ltd. 7.50 3.33 3.25 1.95

Profitability Ratio

Gross Profit Margin JK Cement Ltd 43% 53% 54% 50%

Prism Cement Ltd. 44% 56% 52% 43%

Net Profit Margin JK Cement Ltd 4% 14% 18% 10%


Return on Assets JK Cement Ltd 2% 12% 15% 7%


Earning Power JK Cement Ltd 8% 20% 22% 14%


Return on Capital JK Cement Ltd 7% 14% 17% 9%


Return on Equity JK Cement Ltd 6% 24% 28% 13%

20


Asset Management Ratio

Inventory Turnover JK Cement Ltd 14.73 15.77 16.15 14.97

Prism Cement Ltd. 21.95 12.02 11.62 8.63

Debtors Turnover JK Cement Ltd 25.08 28.25 30.36 34.03

Prism Cement Ltd. 78.59 84.64 252.22 371.15

Fixed Assets turnover JK Cement Ltd 0.97 1.35 1.45 1.30

Prism Cement Ltd. 3.28 2.16 2.35 1.61

Total Assets Turnover JK Cement Ltd 0.66 0.80 0.82 0.74

Prism Cement Ltd. 2.38 1.36 1.19 0.74

WC To Total Assets JK Cement Ltd 0.24 0.20 0.21 0.29

Prism Cement Ltd. 0.00 -0.05 0.02 0.01

RE to Total Assets JK Cement Ltd 0.46 0.48 0.56 0.55

Prism Cement Ltd. -0.19 0.20 0.43 0.43

Liquidity Ratio

Current Ratio JK Cement Ltd 2.65 2.48 2.31 2.89

Prism Cement Ltd. 1.01 0.83 1.10 1.05

Acid Test Ratio JK Cement Ltd 2.21 1.96 1.91 2.45

Prism Cement Ltd. 0.50 0.34 0.49 0.57

Debt Management Ratio

Debt-Equity Ratio JK Cement Ltd 0.86 0.68 0.48 0.48

21

Prism Cement Ltd. 0.43 0.00 0.00 0.00

Interest Coverage ratio JK Cement Ltd 1.90 8.83 10.66 6.14

Prism Cement Ltd. 5.81 51.70 99.67 47.76

Valuation Ratio

PE Ratio JK Cement Ltd 27.35 5.66 4.30 1.95

Prism Cement Ltd. 13.43 6.67 4.15 7.05

EV-EBIDTA Ratio JK Cement Ltd 9.58 4.45 3.78 2.44

Prism Cement Ltd. 6.71 3.88 2.85 3.78

Earnings Per Share JK Cement Ltd 6.36 25.54 37.92 20.36

Prism Cement Ltd. 2.08 6.46 8.10 3.23

1. Both the companies use equity as source of finance. JK Cement Ltd is using

approximately 40% debt in its capital structure but Prism Cement Ltd is not using any

debt in last three year. In 2005-06 it was using some part of debt but after this year they

redeemed all debt and relay on equity financing only.

2. Although Cement Industry is manly based on Land and Machinery. It means its major

application of fund in on long term basis. That’s why investment on current assets on

prism cement ltd is very low because their policy is to maintain low cash balance. On the

other hand JK Cement ltd is maintaining large cash balance. This is good because they

can meet their current liabilities very easily but this is also leading to idle fund which in

unproductive.

3. In 2005-06 JK Cement ltd interest coverage ratio was very low but after this

management has performed very well and able to maintain good return. So, that they

22

can easily cover its interest. On the other hand Prism is performing very well and they

are able to cover their interest more than 50 times. This is because they are not using

debt financing, so their interest liability is very low and they can cover this very easily.

4. Prism Cement Ltd has maintained very rigid debtor or Receivable Policy. They do not

make any sales on credit. That’s why their debtor turnover ratio is very high. On the

other hand JK Cement ltd is using liberal policy and providing credit period of 12 – 15

days.

5. Both the companies are maintaining good GP Margin but if we see Net Profit then they

are getting very less net profit. This shows that the cement industry have lot of

administrative, selling & Distribution expenses. This lead to very less net profit for both

companies. If we compare both companies then Prism performance is better than JK

Cement Ltd.

6. PE Ratio of both companies are very fluctuating due to fluctuation in Market. In 2005-06

MPS of both companies was very high but after that there is slowdown in cement

industry which leads to less MPS for both companies. This lead to low PE Ratio for both

firms.

7. JK Cement is also ahead on working capital management. Because they are maintaining

sufficient amount of current assets to make its WC positive. But for Prism cement Ltd

WC was in negative in 2006-07 this show poor management of working capital.

8. If we see bankruptcy prediction then both companies are performing very well. There is

no sign of bankruptcy for both companies. Atman Z-score shows that both the

companies are very healthy in its operation.

23

4.2 Conclusion

Although Production capacity of Prism Cement Ltd. is less then JK Cement Ltd, but still

performance of Prism Cement is very good. Performance of prism Cement Ltd. is easily

analyzed by the ratio mentioned follows.

1. Working capital positions of both the companies are not good. One is maintaining over

current assets and other one is under current assets. Both the condition are not good

for company. So, in current assets both company fail to manage it.

2. As cement industry require more investment on fixed assets, that’s why they rely more

on equity financing. Although JK Cement Ltd. is using 40:60 debt equity mix but prism is

debt free. There is scope of using debt as source of finance to increase the leverage of

company.

3. Prism is maintaining very rigid debtor policy because of which its debtor turnover ratio is

very high. On the other hand JK cement Ltd. is opting liberal policy to increase its sales.

4. JK Cement Ltd has issued lower equity as compare to Prism Cement Ltd. that’s why its

Earnings Per Share is very high as compare to Prism Cement Ltd.

5. PE Ratio of JK Cement Ltd. is high as compare to Prism Cement Ltd. which shows good

future prospects, good return for investors. But from 2006-07 its MPS start falling due to

certain news in market about cement industry. This also affects the market price of

Prism Cement Ltd.

6. Prism cement Ltd is also providing good return to equity share holder as compare to JK

Cement Ltd.

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4.3 Suggestion & Recommendation

1. Prism cement Ltd should manage its working capital properly to maintain its liquidity

position. Since its current assets is very low against current liability which lead to lower

or negative working capital as well as current ratio. Similarly JK Cement Ltd is

maintaining huge cash balance which is symptom of idle/unproductive fund.

2. For Prism Cement Ltd, there is scope of raising fund from debt financing. This will

increase financial leverage for a company. It will also reduce tax burden and increase

EPS for shareholder.

3. Prism Cement Ltd also liberalized its debtor policy to increase its sales. If credit period

for customer will increase then ultimately sales will increase.

4. Both company have huge administrative and other expenses, this reduces its net profit.

So, company try to minimize its administrative expenses to enhance its sales.

25

Bibliography

1. Annual Report of Prism Cement Ltd.& JK Cement Ltd.

2. www.jkcement.com

3. www.money.rediff.com

4. www.5paisa.com

5. www.wikipedia.com

6. Sharma & Gupta, Management Accounting,

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Comparative Analysis of Prism Cement Ltd With JK Cement Ltd

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