Avon Cycles Ltd

1. Industrial Training
at
Avon Cycles Limited
Under Guidance Of:
Dr. P. P. Singh
Presented By:
Neha Jain
94972238289

2. About Avon Cycles Limited

3. Business Type Exporter/ Importer/ Manufacturer
Year of Establishment 1951
Year of Commencement 1952
Company Branches Ludhiana, Chandigarh
Managing Director Sh. Onkar Singh Pahwa
Export Turnover About Rs. 100Crores (20% of turnover)
Annual Turnover Rs. 500Crores
Capacity to Produce 5000 Cycles per day
Bankers
Punjab National Bank, State Bank of India,
CITI Bank, HDFC Bank Limited, HSBC Bank
Company Profile

4. Vision:
Quality at Affordable Price with Technological
Innovation and Investment in Human Capital

5.  Products:
 Bicycles
o Roadster for Gents and Ladies
o Mountain
o City
o BMX
o Kids
 Exercisers
 Bicycle Parts, wide range
 Electric Bicycles

6.  Marketing
 Business Strategy
 Expansion Plans
 Charity
Aspects of Avon Cycles Limited

7. Global Presence

8. Functioning of Departments
 Electronic Data Processing
 Drawing and Development Department
 Inspection of Incoming Raw Material and Parts
 Publicity Department
 Personnel Department

9.  Tool Room and Maintenance Department
 Marketing Department
 Accounts Department
 Taxation Department
 Production Planning and Control Department
 Quality Management System

10. Quality Certificates

12. Ratio Analysis

13. Current Ratio = Current Assets
Current Liabilities
Particulars 2006-07 2007-08 2008-09
Current Assets1,641,865,9831,560,706,6761,523,525,703
Current
Liabilities
622,475,713840,357,896689,656,719
Current Ratio2.64 1.86 2.21
Table 2.1

14. Quick Ratio = Quick Assets
Current Liabilities
Particulars 2006-07 2007-08 2008-09
Quick Assets1,375,241,6981,304,802,8731,282,268,128
Current
Liabilities
622,475,713840,357,896689,656,719
Quick Ratio 2.21 1.55 1.86
Table 2.2

15. Absolute Liquid = Absolute Liquid Assets
Ratio Current Liabilities
Particulars 2006-07 2007-08 2008-09
Absolute Liquid Assets34,166,92064,610,902174,724,242
Current Liabilities622,475,713840,357,896689,656,719
Absolute Liquid Ratio0.05 0.08 0.25
Table 2.3

16. Stock Turnover = Cost of Goods Sold
Ratio Average Inventory
Particulars 2006-07 2007-08 2008-09
COGS 436,142,374388,281,130496,041,031
Average Inventory117,122,075840,357,896689,656,719
Stock Turnover Ratio
(in times)
3.72 2.63 2.99
Stock Conversion
Period (in months)
3.22 4.56 4.01
Table 2.4

17. Debtor Turnover = Net Credit Annual Sales
Ratio Average Trade Debtors
Particulars 2006-07 2007-08 2008-09
Sales 2,903,087,9733,217,566,7934,152,084,907
Average Debtors669,317,554.50773,047,057740,883,286
Debtor Turnover
Ratio (in times)
4.34 4.16 5.6
Average Collection
Period (in months)
2.77 2.88 2.14
Table 2.5

18. Creditor Turnover = Net Credit Annual Purchases
Ratio Average Trade Creditors
Particulars 2006-072007-082008-09
Purchases
176,514,2
10
175,500,6
72
200,779,763
Average Creditors
343,282,4
06.50
501,238,2
33.50
521,249,794
Creditor Turnover Ratio
(in times)
0.51 0.35 0.39
Creditor Payment Period
(in months)
23.36 34.29 31.17
Table 2.6

19. Working capital = Sales
Turnover Ratio Average working Capital
Particulars 2006-07 2007-08 2008-09
Sales 2,903,087,9733,217,566,7934,152,084,907
Average Working
Capital
946,899,716.50875,696,095782,935,452
Working Capital
Turnover Ratio
3.07 3.67 5.3
Table 2.7

20. Fixed Asset = Sales
Turnover Ratio Net Fixed Assets
Particulars 2006-07 2007-08 2008-09
Sales 2,903,087,9733,217,566,7934,152,084,907
Net Fixed
Assets 194,536,779384,994,329659,488,577
Fixed Asset
Turnover Ratio
3.07 8.36 6.3
Table 2.8

21. Capital Turnover = Sales
Ratio Capital Employed
Particulars 2006-07 2007-08 2008-09
Sales 2,903,087,9733,217,566,7934,152,084,907
Capital Employed1,377,180,0591,466,797,7891,782,358,488
Capital Turnover
Ratio 2.11 2.19 2.33
Table 2.9

22. Debt Equity = Outsiders Funds
Ratio Shareholders’ Funds
Particulars 2006-07 2007-08 2008-09
Outsiders Funds365,237,755313,195,516395,117,338
Shareholders’
Funds
1,007,312,1571,105,875,9901,285,326,819
Absolute liquid
Ratio
0.36 0.28 0.31
Table 2.10

23. Ratio of Fixed Asset = Fixed Asset
to Funded Debt Funded Debt
Particulars 2006-07 2007-08 2008-09
Fixed Funds 194,536,779384,994,329659,488,577
Funded Debt 118,133,466118,133,466195,197,664
Ratio of Fixed Asset
to Funded Debt
1.65 3.26 3.38
Table 2.11

24. Financial = Earnings before Interest and Tax (EBIT)
Leverage EBIT – (Interest and Preference Dividend)
Particulars 2006-07 2007-08 2008-09
EBIT 210,649,142269,878,682397,872,707
Interest 18,823,41634,963,00646,585,380
Preference Dividend0 0 0
Financial Leverage1.1 1.15 1.13
Table 2.12

25. Ratio of Reserves to = Reserves
Equity Capital Equity Share Capital
Particulars 2006-07 2007-08 2008-09
Reserves 998,347,7371,096,911,5701,276,362,399
Equity Share Capital8,964,4208,964,420 8,964,420
Ratio of Reserves to
Equity Share Capital
111.37 122.36 142.38
Table 2.13

26. Gross Profit = Gross Profit * 100
Net Sales
Particulars 2006-07 2007-08 2008-09
Gross Profit2,466,945,5992,829,285,6633,656,043,876
Sales 2,903,087,9733,217,566,7934,152,084,907
Gross Profit
Ratio (%)
84.98 87.93 88.05
Table 2.14

27. Net Profit = Net Profit after Tax * 100
Ratio Net Sales
Particulars 2006-07 2007-08 2008-09
Net Profit 134,707,316156,328,540217,464,279
Sales 2,903,087,9733,217,566,7934,152,084,907
Net Profit Ratio
(%)
4.64 4.86 5.24
Table 2.15

28. Operating = Operating Cost * 100
Ratio Net Sales
Particulars 2006-07 2007-08 2008-09
Operating Cost893,571,550873,321,9531,156,759,584
Sales 2,903,087,9733,217,566,7934,152,084,907
Operating Ratio
(%)
30.78 27.14 27.86
Table 2.15

29. Operating Profit = Operating Profit * 100
Ratio Net Sales
Particulars 2006-07 2007-08 2008-09
Operating
Profit
2,009,516,4232,344,244,8402,995,325,323
Sales 2,903,087,9733,217,566,7934,152,084,907
Gross Profit
Ratio (%) 69.22 72.86 72.14
Table 2.17

30. Return on Shareholders’ = Net Profit (after interest & tax) * 100
Investment Shareholders’ Funds
Particulars2006-07 2007-08 2008-09
Net Profit 134,707,316156,328,540217,464,279
Shareholders’
Funds
1,007,312,1571,105,875,9901,285,326,819
Return on
Shareholders’
Investment (%)
13.37 14.14 16.92
Table 2.18

31. E.P.S. = Net Profit after Tax – Preference Dividend
Number of Equity Shares
Particulars 2006-07 2007-08 2008-09
Net Profit after Tax134,707,316156,328,540217,464,279
Preference Dividend0 0 0
Number of Equity
Shares
896,442 896,442 896,442
E.P.S. 150.27 174.39 242.59
Table 2.19

32. Trend Analysis

33. Trend of Sales
Figure 2.1

34. Trend of Net Profit
Figure 2.2

35. Trend of Earning Per Share (E.P.S.)
Figure 2.3

36. TITLE:
Hurdles faced by Exporters of
Ludhiana under Bicycle Industry

37. Objectives
 To know the problems faced by exporters in cycle
industry.
 To know the satisfaction level of exporters for the
support provided by government.

38. Need of the Study
 Problems faced by exporters of Ludhiana under
bicycle industry.
 Satisfaction level of organizations from
• Government
• ITPO
• Shipping Companies

39. Limitations of the Study
 Time is the major constraint while doing this
research project, as it may have effected the
inference drawn in the study.
 All the firms in bicycle industry in Ludhiana
could not be surveyed, which could effect the
result.

40. Research Methodology

41. Research Design
Descriptive Research Design.
Data Collection
Primary Data – through questionnaires comprising 16
questions.
Population
Exporters of bicycle/ bicycle parts in Ludhiana.

42. Sampling Frame
Exporters of bicycle/ bicycle parts in Ludhiana.
Sampling Unit
Any individual organization which is exporting bicycle/ bicycle
parts in Ludhiana.
Sample Size
30
Sampling Technique
Convenience Sampling

43. Data Analysis
&
Interpretation

44. Number of years from which the company is into exports
of bicycle/ bicycle parts.
N = 30
Figure 4.1

45. N = 30
Figure 4.2
Continents to which the company exports their bicycle/ bicycle
parts.

46. Continent to which the export is maximum.
N = 30
Figure 4.3

47. Any problem in the execution of exports is faced or not.
N = 30
Figure 4.4

48. N = 30
Exchange rate fluctuations effect the cash flow cycle.
1 2 3 4 4.2 5
Figure 4.5
Rating Number of Responses
Strongly disagree 1
Moderately disagree 0
Neither agree nor disagree 3
Moderately agree 14
Strongly agree 12
Mean 4.2
Table 4.4

49. CENVAT is refunded by government on time.
N = 30
Rating Number of Responses
Strongly disagree 3
Moderately disagree 16
Neither agree nor disagree 11
Moderately agree 0
Strongly agree 0
Mean 2.27Table 4.5
1 2 2.27 3 4 5
Figure 4.6

50. Documents are cleared by government on time.
N = 30
Rating Number of Responses
Strongly disagree 3
Moderately disagree 7
Neither agree nor disagree 12
Moderately agree 8
Strongly agree 0
Mean 2.83Table 4.6
1 2 2.83 3 4 5
Figure 4.7

51. Availability of port is optimum.
N = 30 Rating Number of Responses
Strongly disagree 5
Moderately disagree 12
Neither agree nor disagree 5
Moderately agree 7
Strongly agree 1
Mean 2.57Table 4.7
1 2 2.573 4 5
Figure 4.8

52. Non-availability of main port in Ludhiana leads to problems
for the organization.
N = 30
Rating Number of Responses
Strongly disagree 0
Moderately disagree 0
Neither agree nor disagree 9
Moderately agree 14
Strongly agree 7
Mean 3.93
Table 4.8
1 2 3 3.93 4 5
Figure 4.9

53. Indian Cycle Industry needs technological advancement.
N = 30
Rating Number of Responses
Strongly disagree 3
Moderately disagree 2
Neither agree nor disagree 2
Moderately agree 12
Strongly agree 11
Mean 3.87Table 4.9
1 2 3 3.87 4 5
Figure 4.10

54. India Trade Promotion Organization is working satisfactorily.
N = 30
Rating Number of Responses
Strongly disagree 4
Moderately disagree 2
Neither agree nor disagree 16
Moderately agree 6
Strongly agree 2
Mean 3Table 4.10
1 2 3 4 5
Figure 4.11

55. Government support provided to Cycle Industry is optimum.
N = 30 Rating Number of Responses
Strongly disagree 10
Moderately disagree 7
Neither agree nor disagree 9
Moderately agree 4
Strongly agree 0
Mean 2.23
Table 4.11
Figure 4.12
1 2 2.23 3 4 5

56. Labor required is easily available in sufficient number.
N = 30 Rating Number of Responses
Strongly disagree 10
Moderately disagree 14
Neither agree nor disagree 3
Moderately agree 2
Strongly agree 1
Mean 2Table 4.12
1 2 3 4 5
Figure 4.13

57. Language is a barrier in international trade.
N = 30
Rating Number of Responses
Strongly disagree 4
Moderately disagree 9
Neither agree nor disagree 13
Moderately agree 3
Strongly agree 1
Mean 2.6
Table 4.13
1 2 2.6 3 4 5
Figure 4.14

58. Services provided by shipping companies are satisfactory.
N = 30 Rating Number of Responses
Strongly disagree 2
Moderately disagree 9
Neither agree nor disagree 8
Moderately agree 11
Strongly agree 0
Mean 2.93
Table 4.14
1 2 2.93 3 4 5
Figure 4.15

59. Infrastructure available to Indian Cycle Industry is optimum.
N = 30 Rating Number of Responses
Strongly disagree 11
Moderately disagree 8
Neither agree nor disagree 8
Moderately agree 3
Strongly agree 0
Mean 2.1Table 4.15
1 2 2.1 3 4 5
Figure 4.16

60. Findings
• Exports of bicycle/ bicycle parts are mainly to Africa and less to
Europe and North America.
• Exporters face problem in execution of exports only in the country,
Uganda.
• Indian bicycle industry needs technological advancement.
• The government is not providing optimum support to the bicycle
industry.

61. • Labor is not available in sufficient number.
• Shipping lines do not provide satisfactory services.
• Infrastructure provided to Indian bicycle industry is insufficient.
• Clearance of goods takes time.
• Container is not available at optimum time.
Cont..

62. Suggestions
• Government should invest in more in research and development for the
bicycle industry.
• Exporters should invest in technological tools, and come at par to
compete with China.
• Shipping companies should provide better and timely services to the
exporters.
• Proper infrastructure should be provided to the industry.
• CENVAT should be refunded by the government on time.
• Indian Trade Promotion Organization should organize more of trade
fairs and exhibitions.

63. Conclusion