The document analyzes the working capital management and ratio analysis of Tinplate Company of India Limited over several years. It finds that the company had negative working capital in 2008 and 2012 due to its parent company's policies, though negative working capital does not necessarily indicate a poor market position. Various ratios like current ratio, quick ratio, and debtors turnover ratio are calculated from the company's financial statements. Recommendations include growing gross working capital in line with production, paying sufficient dividends, and enhancing marketing strategy. In conclusion, the company has maintained good liquidity and paid liabilities and dividends on time.

1. WORKING CAPITAL
MANAGEMENT AND RATIO
ANALYSIS OF TINPLATE COMPANY
OF INDIA LIMITED
SREOSHI BERA
IMBA/45018/2011

2. INTRODUCTION

3. COMPANY’S
OVERVIEW
COMPANY Tinplate Company of India Ltd.
(TCIL)
Established 1922
Chairman Mr. Koushik Chatterjee
Managing
Director
Mr. Tarun Daga
Industry Mining/Minerals/Metals
Headquarter 4, Bank shall Street, Kolkata
Works Golmuri, Jamshedpur, Jharkhand
Product
Range
Oil cans (OC)
Non-oil cans (NOC)
Open Top Sanitary Cans (OTC)
Tin-free Steel
Auditors Price Waterhouse (301112E)
BSE Code 504966
NSE Code TINPLATE

4. ABOUT WORKING CAPITAL
Working capital is the capital required for maintenance
of day-to-day business operations. The present day
competitive market environment calls for an efficient
management of working capital. The reason for this is
attributed to the fact that an ineffective working capital
management may force the firm to stop its business
operations, may even lead to bankruptcy. Hence the
goal of working capital management is not just
concerned with the management of current assets &
current liabilities but also in maintaining a satisfactory
level of working capital.

5. OBJECTIVE AND
SIGNIFICANCE

6. OBJECTIVE
To analyze factors that Tinplate Company of
India Ltd.:
• Consider for their working capital
requirement.
• To understand their Working Capital Policies.
• To analyze the company’s performance by
studying the financial statement.

7. SIGNIFICANCE
The various significance of Working Capital Management are as follows:-
• Cash Discount: if a proper cash discount is maintained, the business can avail
the advantage of cash discount by paying cash for its purchase of the raw
materials and machineries. It will result in reducing the cost of production.
• It creates a feeling of security and confidence: Proper Working Capital
arrangement results in less worrying for the payment of business expenses or
creditors.
• “MUST” for maintain solvency and continuing production
• As it creates a sound goodwill so it results in getting easy loans from the banks.
• Therefore, Working Capital management shows that the firm has enough
liquid cash or cash equivalent; therefore it indicates that the firm has good
dividend distribution policy. This also helps in accelerating the market value
per share of the firm
• The firm with the help of Working Capital management can meet any
unforeseen contingencies or situations.
• Working Capital Management helps in increasing the lending power of a firm
with efficient Working Capital a firm can borrow more money from the public.
• Effective Working Capital Management ensures smooth production and
operation activity. Thus, it increases the image of the firm in the society.

8. METHODOLOGY

9. DATA COLLECTION PROCEDURE
Data was collected from following SECONDARY
SOURCES like:
Annual reports of the company
Journals and magazines published by the
company
Analysis of files and official documents
Surfing online websites of TCIL and other tinplate
companies.
The collected information was edited & tabulated
for the purpose of analysis.

10. FINDINGS: WORKING CAPITAL
AND RATIO ANALYSIS

11. NET WORKING CAPITAL
YEAR 2008 2009 2010 2011 2012
NET
WORKING
CAPITAL (36.07) 24.61 3.95 36.07 (33.60)

12. -33.07
24.61
3.95
36.07
-33.6
-40
-30
-20
-10
0
10
20
30
40
2008 2009 2010 2011 2012
NET WORKING CAPITAL
NET WORKING
CAPITAL

13. INTERPRETATION OF WORKING
CAPITAL OF TCIL
Company’s working capital gives us a picture about its
position in the market. Though negativity does not mean
that the company is in a bad position in the market, many
firms have a negative working capital still they are holding a
top position in the market. Negative working capital is a
situation in which a business is continuing to operate in
spite of the fact that the liabilities held by the company are
more than the company’s available assets. Essentially, this
means that the accounts payable for the period of operation
is more than the account receivables for the same period.
Generally, these are short-term situations that take place
because payments related to sales generated in previous
periods have not yet been received and posted to the
receivables. At the same time, the expenses found in the
payables are posted and awaiting disposition.

14. In short…
• The negative working capitals in 2008 and
2012 are due its mother company’s policies.
• As we know that TATA STEEL is the mother
company its decision of buying the Corus
company had influenced the money supply of
the sister industries.
• Moreover, TCIL has low sales and high stocks
in its inventory in those years which indicated
less sells.

15. WORKING
CAPITAL
TURNOVER
RATIO
2008 2009 2010 2011 2012
W.C. Turnover Ratio-11.0573884126.83015035 197.4683544 30.47525892-18.65605475
-50
0
50
100
150
200
250
FORMULA
WORKING CAPITAL TURNOVER RATIO = NET SALES
NET WORKING CAPITAL

16. CURRENT
RATIO
FORMULA
CURRENT RATIO = CURRENT ASSETS
CURRENT LIABILITIES
2008 2009 2010 2011 2012
Current Ratio 0.72561996 1.154896777 1.017686831 1.143612626 0.841104701
0
0.2
0.4
0.6
0.8
1
1.2
1.4

17. QUICK RATIO
FORMULA
QUICK RATIO= CURRENT ASSETS – INVENTORY
CURRENT LIABILITIES
2008 2009 2010 2011 2012
Quick Ratio 0.598509052 0.912072004 0.742443917 0.914339228 0.592594344
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1

18. DEBTORS
TURNOVER RATIO
FORMULA
DEBTORS TURNOVER RATIO= NET CREDIT SALES
AVERAGE DEBTORS
Where: AVERAGE DEBTORS= (OPENING DEBTORS + CLOSING
DEBTORS) / 2
2008 2009 2010 2011 2012
Debtors T.O. 25.3231746 29.38540276 27.49383151 27.56731437 17.46601671
0
5
10
15
20
25
30
35

19. RECOMMENDATIONS
• Company’s gross working capital has been
growing over the years, as because production of
tinplate has been increasing and also due to
commission of Cold Rolling Mill 2.
• Provision for tax and dividend is increasing
consistently year by year, company should pay
out sufficient dividend to stakeholders and
remaining should be used as retained earning.
• The company should enhance their marketing
strategy and try to penetrate more in both global
and domestic tinplate industry.

20. CONCLUSION
• Tinplate Company of India Ltd. has been able
to maintain a good liquidity position
throughout. It has been able to pay back its
liabilities on time and also has been able to
give dividends on time to its shareholders. It
has also maintained a moderate level of
Earning Per Share.

21. BIBLIOGRAPHY
• Book:
Financial management – I.M. Pandey
Working capital management – Krish Rangarajan
Annual report of TCIL
• Website:
http://www.tatatinplate.com/
http://www.investopedia.com/
http://www.tatasteel.com/

22. THANK YOU