Bullet Advice For Indian Stocks Weekly – Trading volume may remain subdued because of year end vacation
BSE Sensex (17360.6) and Nifty (5178.40) closed up by 3.8% and 3.82% respectively last week.Nifty Future December was quoting at Seven points premium.Nifty Call Option December 5200 was very active.Support for Sensex is at 16820. Resistance for Sensex is at 17950 .Crude oil was at 78.05 $.
Sharp rise in advance tax nos. by corporate fueled the rally.Market will remain closed on 28th December 2009 because of Moharram.
DLF and Tata Steel added Open Interest in December series.Huge position was build up at Suzlon December Call Option Strike Price 90.Good build up was also seen at IFCI December Call Option Strike Price 55..
1)Hotel Leela(46.40) Lot Size-7500 Shares
One Call Option of January Strike Price 45@ Rs.2.50 Rs
Sell One Call Option of January Strike Price 47.50@1.50 Rs.
Premium .Paid=2.5*7500= 18750.00 Rs.
Premium Received=1.5*7500= 11250.00Rs.
Net Premium Paid==18750-11250=7500.00 Rs.
Maximum Profit==47.5-45==2.5*7500=18750-7500=11250.00 Rs.
Maximum Loss= 7500.00 Rs.
Break Even Price=46
2)Neyveli Lignite(151.35) January Future-Lot Size 1475 shares.
One Lot January Future @151.35
Sell One Call Option of January Strike Price 160@3.50 Rs.
Premium Received=3.50*1475= 5162.50 Rs
Maximum Profit=160-151.35=8.65*1475=12758.75+5162.50=17921.25 Rs.
Max Loss=Unlimited.
Trend of Major Stocks
STOCK TREND Days WeeklyTrend MonthlyTrend
BHEL.NS Bulllish 2 Rising Falling
ICICIBANK.NS Bulllish 3 Flat! Flat!
INFOSYSTC.NS Bulllish 2 Rising Falling
ITC.NS Bulllish 2 Flat! Flat!
MARUTI.NS Bulllish 2 Falling Falling
SBIN.NS Bulllish 3 Flat! Flat!
TATASTEEL.NS Bulllish 3 Flat! Flat!
TCS.NS Bulllish 2 Flat! Flat!
Technical indicators of major Stocks
MFI=Money Flow Index
RSI=Relative Strength Index
ADX=Directional Momentum Index
STOCK CLOSE MFI-21 RSI-14 ADX-14
BHEL.NS 2369.4 52.09 61.7 18.5
ICICIBANK.NS 864.9 41.76 52.39 15.94
INFOSYSTC.NS 2591.8 65.97 70.12 31.74
ITC.NS 255.85 27.53 53.65 19.61
MARUTI.NS 1565.95 44.87 51.21 10.56
SBIN.NS 2219.05 34.5 47.96 21.75
TATASTEEL.NS 615.6 51.68 68.16 14.31
TCS.NS 749.3 70.11 73.76 28.45
Trading Idea
1)Bombay Dying(405.15) this stock in decline and trade.
2)Bhusan Steel(1430.10) this stock in decline and trade
By
Bullet Advisory Indian Stocks-India’s Top Most No.1 Best Stock Market Advice Blog,Hot Stock Tips Calls by Expert Technical Analyst Narendra Nainani of India.Most Preferred and Successful Paid Subscription Stock Tips Calls Website of India.Excellent Success Ratio of more than 90% with Superb trading ideas.Most Successful Intraday Stock Future Calls Provider Service Indian Share Market.
M-+919898162770
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Bullet Advisory Indian Stocks-India’s top most no.1 best stockmarket advice blog,hot stocktips calls by expert technical analyst Narendra Nainani of India
Website http://
Narendra Nainani AHMEDABAD, GUJARAT, India Narendra Nainani is renowned technical analyst and stock market advisor of INDIA having experience of more than 26 years having excellent success ratio.Expert in Derivatives Products-Futures & Options,Intraday,Short Term ,Medium Term,Long Term,Portfolio Management,IPO & Mutual Fund Advisor.Covered regularly by E TV & Business Magazines like The Economic Revolution for Market views. India’s top most no.1 best stockmarket advice blog hot stocktips calls by expert technical analyst of India.Most preferred paid subscription stocktips calls website India.Excellent success ratio of more than 90%.good superb trading ideas.M-9898162770 Website .
Bullet Advice For Indian Stocks Weekly – Future and Options expiry may cause volatility
BSE Sensex (16719.83) and Nifty (4987.70) closed down by 2.3% and 2.5% respectively last week.Nifty Future December was quoting at 0.90 points discont.Nifty Call Option December 5100 was very active.Support for Sensex is at 16310. Resistance for Sensex is at 17100 .Support for Nifty is at 4865 and resistance at 5100.Crude oil was at 73.30 $.
Caution at higher levels was visible.Fear of possible CRR hike by RBI prevented players from making new commitments.
Suzlon and ICICI Bank added Open Interest in December series.Huge position was build up at Suzlon December Call Option Strike Price 85.Good build up was also seen at Tata Steel December Call Option Strike Price 560..
1)Cipla(356.55) Lot Size-1250 Shares
One Call Option of December Strike Price 350@ Rs.11.00 Rs
Sell One Call Option of December Strike Price 360@6.95 Rs.
Premium .Paid=11*1250= 13750.00 Rs.
Premium Received=6.95*1250= 8687.50Rs.
Net Premium Paid==13750-8687.50=5062.50 Rs.
Maximum Profit==360-350==10*1250=12500-5062.50=7437.50 Rs.
Maximum Loss= 5062.50 Rs.
Break Even Price=354.05
2)Cairn(268.45) December Future-Lot Size 1250 shares.
One Lot December Future @268.45
Sell One Call Option of December Strike Price 270@5.30 Rs.
Premium Received=5.3*1250= 6625.00 Rs
Maximum Profit=270-268.45=1.55*1250=1937.50+6625.00=8562.50 Rs.
Max Loss=Unlimited.
Trend of Major Stocks
STOCK TREND Days WeeklyTrend MonthlyTrend
BHEL.NS Bearish 3 Rising Falling
ICICIBANK.NS Bearish 5 Flat! Flat!
INFOSYSTC.NS Bearish 1 Rising Falling
ITC.NS Bearish 1 Flat! Flat!
MARUTI.NS Bearish 4 Falling Falling
SBIN.NS Bearish 10 Flat! Flat!
TATASTEEL.NS Bulllish 3 Flat! Flat!
TCS.NS Bulllish 3 Flat! Flat!
Technical indicators of major Stocks
MFI=Money Flow Index
RSI=Relative Strength Index
ADX=Directional Momentum Index
STOCK CLOSE MFI-21 RSI-14 ADX-14
BHEL.NS 2318.7 50.43 55.77 19.21
ICICIBANK.NS 809.35 34.18 36.27 16.63
INFOSYSTC.NS 2525.95 70.61 65.77 31.3
ITC.NS 247 24.07 40.03 19.24
MARUTI.NS 1548.8 51.47 47.3 12.34
SBIN.NS 2145.35 38.06 36.57 20.51
TATASTEEL.NS 563.25 46.5 55.2 12.23
TCS.NS 727.5 70.94 72.02 23.47
Trading Idea
1)Essar Oil(140.55) this stock in decline and trade.
2)DCHL(158) this stock in decline and trade
By
Bullet Advisory Indian Stocks-India’s Top Most No.1 Best Stock Market Advice Blog,Hot Stock Tips Calls by Expert Technical Analyst Narendra Nainani of India.Most Preferred and Successful Paid Subscription Stock Tips Calls Website of India.Excellent Success Ratio of more than 90% with Superb trading ideas.Most Successful Intraday Stock Future Calls Provider Service Indian Share Market.
-+919898162770
Website http://
Narendra Nainani AHMEDABAD, GUJARAT, India Narendra Nainani is renowned technical analyst and stock market advisor of INDIA having experience of more than 26 years having excellent success ratio.Expert in Derivatives Products-Futures & Options,Intraday,Short Term ,Medium Term,Long Term,Portfolio Management,IPO & Mutual Fund Advisor.Covered regularly by E TV & Business Magazines like The Economic Revolution for Market views. India’s top most no.1 best stockmarket advice blog hot stocktips calls by expert technical analyst of India.Most preferred paid subscription stocktips calls website India.Excellent success ratio of more than 90%.good superb trading ideas.M-9898162770 Website .
Bullet Advisory Analyses Indian Share Market Future Call Put Option Stocks
Bullet Advice For Indian Stocks Weekly – market near crucial resistance levels
BSE Sensex (17101.50) and Nifty (5108.90) closed up by 2.8% and 3.4% respectively last week.Nifty Future December was quoting at 4.55 points premium.Nifty Call Option December 5200 was very active.Support for Sensex is at 16720. Resistance for Sensex is at 17420 .Support for Nifty is at 4980 and resistance at 5210.Crude oil was at 77.3 $.
Initial Public Offer of JSW Energy and Godrej Properties will open for bidding in the coming week.
SBI and Tata Steel added Open Interest in December series.Huge position was build up at Reliance Industries December Call Option Strike Price 1110.Good build up was also seen at SBI December Call Option Strike Price 2400..
1)NagarjunaFertilizer(32.55) Lot Size-5250 Shares
One Call Option of December Strike Price 32.50@ Rs.1.60 Rs
Sell One Call Option of December Strike Price 37.50@0.30 Rs.
Premium .Paid=1.6*5250=8400.00 Rs.
Premium Received=0.30*5250=1575.00 Rs.
Net Premium Paid==8400-1575=6825.00 Rs.
Maximum Profit==37.50-32.50==5*5250=26250-6825.00=19425.00 Rs.
Maximum Loss= 6825.00 Rs.
Break Even Price=33.80
2)Hind Petro(380) December Future-Lot Size 650 shares.
One Lot December Future @380
Sell One Call Option of December Strike Price 380@13.00 Rs.
Premium Received=13*650= 8450.00 Rs
Maximum Profit=8450.00 Rs.
Max Loss=Unlimited.
Trend of Major Stocks
STOCK TREND Days WeeklyTrend MonthlyTrend
BHEL.NS Bearish 4 Falling Falling
ICICIBANK.NS Bearish 1 Flat! Flat!
INFOSYSTC.NS Neutral 1 Rising Falling
ITC.NS Neutral 1 Flat! Flat!
MARUTI.NS Bearish 1 Rising Falling
SBIN.NS Bulllish 4 Flat! Flat!
TATASTEEL.NS Bearish 1 Flat! Flat!
TCS.NS Bulllish 1 Flat! Flat!
Technical indicators of major Stocks
MFI=Money Flow Index
RSI=Relative Strength Index
ADX=Directional Momentum Index
STOCK CLOSE MFI-21 RSI-14 ADX-14
BHEL.NS 2208.8 46.53 40.26 11.53
ICICIBANK.NS 871.45 48.22 47.68 13.84
INFOSYSTC.NS 2383.6 71.13 55.36 22.06
ITC.NS 256.7 40.56 50.22 14.42
MARUTI.NS 1591.95 59.49 56.01 14.11
SBIN.NS 2328.05 70.44 55.17 14.97
TATASTEEL.NS 575.95 58.5 59.52 18.22
TCS.NS 695.2 78.44 62.8 20.82
Trading Idea
1)Biocon(291.90) this stock in decline and trade.
2)Essar Oil(145.45) this stock in decline and trade
By
Bullet Advisory Indian Stocks-India’s Top Most No.1 Best Stock Market Advice Blog,Hot Stock Tips Calls by Expert Technical Analyst Narendra Nainani of India.Most Preferred and Successful Paid Subscription Stock Tips Calls Website of India.Excellent Success Ratio of more than 90% with Superb trading ideas.Most Successful Intraday Stock Future Calls Provider Service Indian Share Market.
-+919898162770
By
Bullet Advisory Indian Stocks-India’s top most no.1 best stockmarket advice blog,hot stocktips calls by expert technical analyst Narendra Nainani of India
Website http://
Narendra Nainani AHMEDABAD, GUJARAT, India Narendra Nainani is renowned technical analyst and stock market advisor of INDIA having experience of more than 26 years having excellent success ratio.Expert in Derivatives Products-Futures & Options,Intraday,Short Term ,Medium Term,Long Term,Portfolio Management,IPO & Mutual Fund Advisor.Covered regularly by E TV & Business Magazines like The Economic Revolution for Market views. India’s top most no.1 best stockmarket advice blog hot stocktips calls by expert technical analyst of India.Most preferred paid subscription stocktips calls website India.Excellent success ratio of more than 90%.good superb trading ideas.M-9898162770 Website .
AN ANALAYSIS OF INNOVATIVE INSTRUMENTS OF RAISING FINANCE BY LISTED INDIAN COMPANY
Companies have been using various financial instruments to raising required capital for achievement of their broad corporative objectives. The innovative instruments have the potential to help Indian companies to overcome the severe financing constraints they have been experiencing over a long period of time. Companies are doing every thing to tap available financial resources through the use of old and innovative instruments and the process will continue indefinetly.Companies in their pursuit of reducing the cost of capital, put a premium on such instrument which will help in achieving such an objectives.
A financial instrument is a combination of characteristics such as promised yield liquidity, maturity, security and risk. The process of financial innovation involves creating new instruments and technique by unpackaging and rebinding the same characteristics in different fashion to suit the constantly changing the needs of the issues and the investor’s .These innovative are of two kinds:-
1 Changes aimed at the tax planning.
2 Adaptive changes that give rise to a gap in the range of available financial instruments.
In corporate finance, financial engineers are often called upon to develop innovative instruments are secure the funds necessary for operation of large scale business. The nature of financing required cost preference and other consideration indicate special instruments, a collection of special features to be attached to an instrument or a combination of instruments to be used in concert. At times it precipitates in the introduction of revolutionary new products such as swap, mortgage, and zero coupon bonds to finance leveraged buyouts. This is the kind of creativity involved in the extension of future trading to a commodity or a financial instrument not previously traded in a futures pit, the introduction of swap variants or the creation of mutual fund with a new focus. At tills other times it involves the piecing together of existing products and process to fit in a particular set of circumstances.
Financial innovation has therefore been a continuous and integral part of corporate world. Greater freedom and flexibility have thus enabled companies to invent and innovate financial instrument and their subsequent introduction. A variety of factors such as increased interest rate, volatility, frequency of tax and regulatory changes etc have stimulated the process of financial innovations. The deregulation of financial service industry and increased competition with in investment banking undoubtedly led to increased emphasis on the ability to design new products , develop better process, and implement more effective solution for increasingly complex financial problems. Financial engineering has thus become the life blood of this activity. According to Thone Finerty F.E involves the design, the development, and the formation of creative solutions to problems in finance. Financial innovations have been a continuous and integral part of the corporate world.
Such innovations could prove extremely beneficial by adding value to the company if it.
Re allocates Risk form those who are less willing to bear it to those who are more willing to assure it.
Enhance liquidity.
Diminishes agency costs emanating form the conflict between share holders, managers and creditors.
Lowers the combined burden of tax to the issuer and the investor.
By passers ingeniously some regulatory restrictions.
New financial Instruments in the capital Market
With the evolution of capital market new financial instruments are being introduced to suit the requirements of the companies. Keeping in view the yield expected by investors, price and credit risk, liquidity and quantum of funds etc. some of the new financial instruments are Zero coupon bonds, warrants, (detachable warrants secured premium Notes, Stock invest, Bond with floating interest rate, Deep discount bonds, option bonds, option, swap financial engineering made first appearance in the finance literature in 1987-88. Thon Finnerty “Financial Engineering in Corporate finance An Overview 1988 pp 4-3)
Financing Instruments Issued by Indian company
After the liberalization measures were announced in 1991, Indian Company under took issuance of new instruments seriously in to attract large section of investors. Essar Steel used convertible debentures with warrants and loyalty coupons, Tata Iron and Steel Company Limited issued secured Premium Notes with warrants, Flex Industries issued partly convertible debentures and non convertible debentures with warrant attached to each instrument DLF aments issued multiple option bonds, Essar oil issued optionally fully convertible debentures and Reliance Petroleum issued triple option convertible with equity warrant and Esab India issued partly convertible debenture.
This burst of innovation has seen a typical shift in the design and development of new instrument. The classic conversion is that of debt in to equity. Offering the investor the option of conversion keeps the cost of his convertible debt lower than straight debt, thus minimizing the cash out flows during the gestation period. Once the project yields steady profits, the equity conversion results in a relatively- expensive dilution. The use of fectures like warrants makes the equity and convertible less expensive for the investor. It creates possibilities for their full subscription by the investors and also turns out to be cheaper for the issuing company.
Nature of Problem
Over the years, Indian Companies have worked in a restrictive and controlled regime where high cost of capital, limited flexibility. Low capacity to raise adequate finances, lower production capacities, obsolete technologies, low auto motion, high product prices, etc. Introduction of new instruments of finances have provided opportunities to Indian Companies to design instruments which could give them the freedom to address to the varying needs of investors group to make an attempt to lower the cost of capital. Introduction of new financing increased the chances for more and more investor’s participation in future offerings of companies. This may enhance the chances for raising more and more funds. It is not clearly known as to what benefits the introduction of such new instruments brings to the companies and the investors and what perceptions investors as well as managements have with regard to these new instruments.
Investments in companies were a risky proposition low returns on equity and availability of limited options due to existence of limited number of instruments were common. The changed scenario promises to be panacea for all the deficiencies of the past. It will therefore, be prudent to analysis how the process of financial innovation has helped to accelerate those of new instruments by Indian companies.
Objectives of Study
Keeping the nature of problem in mind an attempt was made to analyze the effects of introduction of new instruments of finance on cost of capital, profitability, expansion, diversification / modernization programmes of various companies, competitiveness, product quality, investors etc, the detailed analysis will provide an insight into above mentioned areas and helps to find out whether introduction of new instruments of finance will help in solving the problems faced by the Indian Companies. Further analysis will also throw some light on the acceptability of these instruments by the investors which will greatly help the Indian companies to overcome the shortage of funds.
The specific objectives of the study are
To study the regulations and development of financial instruments in India.
To analyze different aspects of new instruments of finance.
To analyze the effects of introduction of new instrument of finances in capital structure.
To analyze the investors, managements and brokers perception regarding the use of new instruments of finance
To ascertain whether there is any further scope for designing newer instruments of finances.
Hypotheses
The present study among other things to include the following hypotheses for testing
The level of income and state of investment is independent of each other.
New and traditional instruments of finance have provided similar investment choices to investors.
New and traditional instruments of financing have provided similar benefits to the investors.
No further innovations are needed in various instrument of financing.
Investors with positive perception about using of innovative features favor continued use of such features in new instruments of finances.
Research Methodology
The study is based on data collected by both primary as well as secondary sources. Annual report, research articles, published in various books and journals on different aspect of the problem under study have served as a major source of secondary data. Apart form discussion with various investors, company official and other classes of respondents properly designed comprehensive questionnaires constituted the primary source of data.
The selection of companies included in this study was based the following criterion.
Companies which have entered the capital market funds and have made use of new and traditional instrument of finance after 1990- 91.
Companies which are in the market for at least 3 years. An effort was made to select at least one company form each industry.
The conclusion and inferences were based on statistical tests such as chi-square test and Likert’s summated technique etc.
Reference:
Asquith Paul and David W Mullin, Equity Issues and offering Dilution Journal of financial Economics January / February 1986 pp 61-89.
Chew. Donald H. In the Revolution In corporate finance edited by Joel M Stern and Doneld H Chew 1992 Black Well Oxford.
Finerty, John D. Financial Engineering in Corporate finance An Overview Financial Management winter 1988 (4-33).
Gupta, Santhosh. Research Methodology and Statistical technique. New Delhi: Deep and deep Publications.
Kothari, CR. Research Methodology. New Delhi: New Age International (p) Limited.
Mishra. R.K. “Financial Instruments” The Chartered Accountant September 1995 p.p (84-90)
Prasana, Chandra. Financial Management Theory and Practice. Tata Mc Graw hill Ltd.
Roju M, thiripal. Financial innovations in the Indian Capital Market during the last decade finance India, Vol No. 1, March 1993. p (43-62)
Bullet Advice For Indian Stocks Weekly – market may remain volatile
BSE Sensex (16158.28) and Nifty (4796.15) closed up by 1.6% and 1.8 % respectively last week.Nifty Future November was quoting at 6.0 points discount.Nifty Call Option November 4800 was very active.Support for Sensex is at 15550. Resistance for Sensex is at 16850 .Support for Nifty is at 4610 and resistance at 5020.Crude oil was at 77.50 $.
Volatility may increase in coming times as FII’s may prefer to book profit ahead of year end.Finance Minister’s statement that no curbs are on cards for foreign capital helped the markets to stabilize at lower levels.
Ashok Leyland and IFCI added Open Interest in November series.Huge position was build up at Reliance Industries November Call Option Strike Price 2010.Good build up was also seen at Suzlon November Call Option Strike Price 70..
1)TataSteel(499.80) Lot Size-764
One Call Option of November Strike Price 500@ Rs.23.50
Sell One Call Option of November Strike Price 530@13.00 Rs.
Premium .Paid=23.50*764=.17954.00 Rs.
Premium Received=13*764=9932.00 Rs.
Net Premium Paid=17954-9932=8022.00 Rs.
Maximum Profit==530-500==30*764=22920-8022=14898.00 Rs.
Maximum Loss=8022 Rs.
Break Even Price=510.50
2)IDFC(158) November Future-Lot Size 2950 shares.
One Lot November Future @158
Sell One Call Option of November Strike Price 160@5.25 Rs.
Premium Received=5.25*2950= 15487.50 Rs
Maximum Profit=160-158=2*2950=5900 + 15487.50=21387.50 Rs.
Max Loss=Unlimited.
Trend of Major Stocks
STOCK TREND Days WeeklyTrend MonthlyTrend
BHEL.NS Bulllish 2 Falling Falling
ICICIBANK.NS Bulllish 3 Flat! Flat!
INFOSYSTC.NS Bulllish 3 Falling Falling
ITC.NS Bearish 2 Flat! Flat!
MARUTI.NS Bulllish 4 Falling Falling
SBIN.NS Bulllish 1 Flat! Flat!
TATASTEEL.NS Bulllish 3 Flat! Flat!
TCS.NS Bearish 1 Flat! Flat!
Technical indicators of major Stocks
MFI=Money Flow Index
RSI=Relative Strength Index
ADX=Directional Momentum Index
STOCK CLOSE MFI-21 RSI-14 ADX-14
BHEL.NS 2219.9 41.28 38.81 25.43
ICICIBANK.NS 848.55 56.68 48.83 27.25
INFOSYSTC.NS 2218.6 33.25 48.98 16.07
ITC.NS 248.85 57.35 49.65 28.42
MARUTI.NS 1471.25 47.15 47.19 15.09
SBIN.NS 2205 47.11 51.79 22.93
TATASTEEL.NS 499.8 63.97 49.16 26.53
TCS.NS 622.15 43.24 55.11 16.24
Trading Idea
1)HDIL(359.65) this stock in decline and trade.
2)Ranbaxy(414.40) this stock in decline and trade
By
Bullet Advisory Indian Stocks-India’s Top Most No.1 Best Stock Market Advice Blog,Hot Stock Tips Calls by Expert Technical Analyst Narendra Nainani of India.Most Preferred and Successful Paid Subscription Stock Tips Calls Website of India.Excellent Success Ratio of more than 90% with Superb trading ideas.Most Successful Intraday Stock Future Calls Provider Service Indian Share Market.
-+919898162770
By
Bullet Advisory Indian Stocks-India’s top most no.1 best stockmarket advice blog,hot stocktips calls by expert technical analyst Narendra Nainani of India
Website http://
Narendra Nainani AHMEDABAD, GUJARAT, India Narendra Nainani is renowned technical analyst and stock market advisor of INDIA having experience of more than 26 years having excellent success ratio.Expert in Derivatives Products-Futures & Options,Intraday,Short Term ,Medium Term,Long Term,Portfolio Management,IPO & Mutual Fund Advisor.Covered regularly by E TV & Business Magazines like The Economic Revolution for Market views. India’s top most no.1 best stockmarket advice blog hot stocktips calls by expert technical analyst of India.Most preferred paid subscription stocktips calls website India.Excellent success ratio of more than 90%.good superb trading ideas.M-9898162770 Website .
It is widely accepted that every successful business must have a strong working capital position. It is in this context; an attempt was made to explain the concept and various determinative factors influencing net current assets below:
Gross working capital refers to working capital as the total of current assets. That is to say, Gross working capital = Total current assets. Net working capital refers to working capital as excess of current assets over current liabilities. In other words net working capital refers to current assets financed by long term funds or capital employed of the business.
Accordingly, Net working capital = Current assets – Current liabilities
The net working capital position of the firm is an imperative contemplation, as this will determine the firm’s profitability and risk. Here the profitability refers to profits after expenses and risk refers to the probability that a firm will become technically insolvent where it will be unable to meet obligations when they become due for payment.
A finance manager has to make an appropriate financing mix, which will limit the risk and increase the profitability. Financing mix refers to the proportion of current assets financed by current liabilities and long term funds.
There are two approaches which determine the financing mix (1) Aggressive approach (2) Conservative approach.
According to aggressive approach the long term funds are used to finance only the core or fixed portion of current assets (e.g., minimum level of finished goods inventory, raw material etc) and the other portion i.e. temporary and seasonal requirements are financed by short term funds. This is of high risk and high profit financing mix.
According to conservative approach the total current assets are financed from long term sources and short term sources are used only in emergency situation i.e. when there is an unexpected cash outflow. This is of low-risk and low-profit financing mix.
As we observed two methods of financing mix, one method is of high risk high profit and other is of risk low profit. A finance manager has to trade off between these two extremes.
Operating Cycle:
As there is a time lag between and realization of receivables there is a need for sufficient working capital to deal with the problem which arises due to lack of immediate realization of cash against goods sold. The operating cycle is the length of time required for conversion of non-cash assets into cash. This operating cycle refers to the time taken for the conversion of cash into raw material, raw materials into work-in-progress, work-in-progress into finished goods, finished into receivables into cash and this cycle repeats.
The operating cycle length differs from firm to firm. If a firm has lengthy production process or a firm has liberal credit policy the length of operating cycle will be more. On the other hand, if a firm does not extent credit or the firm is not a manufacturing concern i.e. where cash will be converted into inventory directly then the length of operating cycle will be reduced to a greater extent.
The length of operating cycle is calculated based on the following:
Raw materials storage period (RMSP)
Work in process period (WIPP)
Finished goods storage period (FGP)
Debtors collection period (DCP)
Creditors Payment Period (CPP)
ThereforeLength of operating cycle = 1+2+ 3+4-5
FACTORS INFLUENCING WORKING CAPITAL NEEDS:
A firm should have neither low nor high working capital. Low working capital involves more risk and more returns, high working capital involves less risk and less returns. Risk here refers to technical insolvency while returns refer to increased profits/earnings. The amount of working capital is determined by a wide variety of factors:
Nature of Business: The working capital requirement of a firm depends on the nature of the business. For example, a firm involved in of services rather than manufacturing or a firm is allowing only cash . In the first instance, no investment is required in either raw materials or WIP or finished goods, while in the second occasion there exists no receivable as there is immediate realization of cash. Hence the requirement of working capital will be lower.
2Seasonality of Operations:
If the product of the firm has a seasonal demand like refrigerators, the firms need high working capital in the periods of summer, as the demand for the refrigerators is more and the firm needs low working capital in the periods of winter, as the demand for the product is low.
3. Production Cycle:
The term production cycle refers to the time involved in the manufacture of goods. It covers the time span between the procurement of the raw materials and the completion of the manufacturing process leading to the production of goods. As funds are necessarily tied up during the production cycle, the production cycle has a bearing on the quantum of working capital.
The longer the time span of production cycle, the larger will be the funds tied up and therefore the larger the working capital needed and vice versa.
4.Production Policy:
The quantum of working capital is also determined by production policy. In case of the firms having seasonal demand of the products like refrigerators, air coolers etc. and the production policy of the firm determines the amount of working capital requirement. If the firm has production policy to carry production at a steady level to meet the peak demand, this will result in a large accumulation of finished goods (inventories) during the off-seasons and the abrupt during the peak season. The progressive accumulation of finished goods will naturally require an increasing amount of working capital. If the firm has production policy to produce only when there is a demand then the firm needs low working capital during the slack season and high working capital during season.
5. Credit Policy:
The level of the working capital is also determined by the credit policy, as the firm’s credit policy determines the amount of receivables. If the firm has a liberal credit policy, then the firm needs high working capital and the firm needs low working capital if the company’s credit policy does not allow it to extend credit to the buyers.
6. Market Conditions:
The working capital requirements are also determined by the market conditions. In case of the high degree of competition prevailing in the market the firm has to maintain larger inventories as customers are not inclined to wait for the product. This needs higher working capital requirements. If there is good demand for the product and the competition is weak, a firm can manage with smaller inventory of finished goods, as customers can wait for the product if it is not available in the market.
Thus, a firm can manage with low inventory and will need low working capital requirements.
7.Conditions of Supply:
The availability of raw materials and spares also determine the level of working capital. If there is ready availability of raw materials and spares, a firm can maintain minimum inventory and need less working capital. If the supply of raw materials is unpredictable, then the firm has to acquire stocks as and when they are available for ensuring continuous production.
Thus, the firm needs to maintain larger inventory average and needs larger requirementofworkingcapital.
CONCLUSION:
From the above discussion, it is made clear that the objective of financial management is to maximize the shareholders wealth. Hence, it is needed to generate sufficient profits. The profits generated depend mainly on volume. When the goods are being sold on credit as is the normal practice of business firms today to cope with increased competition the of goods cannot be converted into cash instantly because of time lag between and realization of cash. Further this is possible only through evolving effective working capital policy and better administration on current assets financing.
Dr.R.SRINIVASAN is a Post graduate in commerce and Management. He received his doctoral degree from Alagappa University in 1997. He is now Working as an ASSOCIATE PROFESSORin Post graduate and Research Department of Corporate Secretaryship at Bharathidasan Government College for Women (Autonomous), Pondicherry University, Puducherry.He currently teaches Accounting ,financial management and Research Methodology Subjects. Before Joining BGCW, he was teaching in SNR College, Coimbatore, Sindhi college, Chennai& T.S.Narayanasamy College, Chennai for eight years. He was with the industry for a short term at Salzar Electronics Pvt. Ltd, Coimbatore. He has about 20 years of teaching experience and having research experience of 15 years. His interests are in Accounting and finance, Capital Market, Quantitative Methods. He underwent the Faculty Development Programme at Indian Institute of Management Ahmedabad during 2000-01. He has presented 20 papers in national and international conferences and has published twenty papers in the areas of Finance and Human resource Management in National Journals. Co-authored a book titled, ‘Investors Protection, published by Raj Publications, New Delhi He has delivered lectures in contemporary finance topics at Pondicherry University. He is involved in consultancy projects for Godrej Saralee, Chennai in the areas of Statistical Applications. He has supervised a number of research projects in the area of corporate finance and Human Resource Management. He is the Board of examiner in corporate Secretaryship and Management for the past two decades. .
If you are an ardent smoker or somebody whom who love trying out international brands that may not available in your country, the easiest way to fulfill your ambitions is to shop from a decent enough online cigarette store. Another plus with online cigarette stores in general is that customers could premium cigarettes from there at much discounted prices. It is owing to a number of heavy taxes imposed on tobacco products in general that is responsible for the higher price tags of premium cigarette brands such as , Camel, Dunhill, Chesterfield, Magna, or Capri. The recent hike in the tax rates has only upped the prices further. But, then how online cigarette stores are able to sell premium cigarette brands at exceedingly lower rates, affordable to the common man on the streets?
As mentioned already, a major chunk of the price charged on cigarette cartons is due to the various taxes imposed on its manufacture, raw materials, etc. The actual cost of the cigarettes minus the taxes will be only half of its market price. Since online do not attract any taxes as of now, online cigarette stores could sell the premium cigarette brands for exceedingly low discount prices. This will be evident if you could visit any of the online cigarette stores and see the rates for yourself. If the market rate for a carton of Marlboro is $40, the price tag for the same in such online cigarette portals will be $12 or $13. This is a price tag that is more than 100% lesser than the market rate!
However, it must be kept in mind that online cigarette selling and buying is not legal in all the states in the United States. For example, California has banned the online marketing of or any other cigar brands. As a result, the online cigarette retailers offering premium cigarettes at discount prices are usually holed up in areas where the tax structure is either low or free or in reserved Indian lands where the stringent federal tax laws are not applicable. If to believe certain market reports that were published on such retailers working out of ‘no-tax’ lands, they make millions of dollars every year and that without having to overstep the contours of law.
Most online cigarette stores also ship to other countries as well, provided the country of the customer permits such trans-national shipping of cigarette cartons. Such a reservation is relevant as in certain countries like Thailand, India, Angola, and Spain, online shipping of cheap discount cigarettes is banned, and is a punishable offence if somebody is found breaching the law of the country. Usually the online cigarette stores specify to which all countries they ship the and to which all nations they do not. Finally, for all the orders placed, payments must be done through credit cards, much in the same way payments are made in shopping websites like eBay or Amazon. Contact the customer care team of the respective online cigarette stores for further details.
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Key West FL is the southernmost city in the Continental United States. Key West is a city and an island by the same name near the southernmost tip of the Florida Keys and encompasses the namesake island, the part of Stock Island north of US 1, Sigsbee Park and Sunset Key.
Many passenger cruise ships utilize Key West as a seaport. Key West International Airport also serves the area. Naval Air Station Key West offers a training site for Naval Aviation.
Key West is officially known for having the nation’s first and oldest continuous gay and lesbian chamber of commerce. Thus the city’s motto “One Human Family”
Kay West was inhabited by ancient peoples known as the Calusa People in Pre-Columbian times. Juan Ponce De Leon was the first European to visit the area and the island was known as Cayo Hueso. It was established as a fishing and salvage village with a small fort to protect the Spanish colony.
Cayo Hueso literally means “bone key” as it is said that the island is littered with the bones from an Indian battlefield or burial ground. It is thought that the name changed to Key West is an Anglicization of the word “Hueso” that could mean west in English. Many businesses on the island use the name.
Great Britain took control of Florida in the late 1700′s and relocated the Spaniards and Indians to Havana. Florida passed back to the Spanish 20 years later but they did not formally resettle. The island was used by fishermen from Cuba and joined by fishermen from the United States.
The island was deeded to Juan Pablo Salis in 1815 but when Florida was transferred to the United States Salas was eager to sell the island. First he sold it for a sloop valued at $575 and then to a US businessman named Simonton for about $2,000. The sloop trader sold it to a man named Geddes who could not secure rights to the property because Simonton had help from influential friends in Washington and gained clear title. Simonton bought the island because he had learned of the opportunities presented by the strategic location. Simonton’s friend John Whitehead, once stranded on the islands by a shipwreck had seen the deep harbor.
Lying 90 in a strategic location on the deep shipping lane Straits of Florida the harbor was considered the “Gibraltar of the West”. Matthew Perry said into the harbor in 1822 and physically planted the US flag to claim it as US property. He reported on the piracy problems and renamed it “Thompson’s Island” and named the harbor “Port Rodgers”. Neither name stuck. In 1823 Commodore David Porter took charge and tried to rule the island as a military dictator under martial law.
Simonton soon subdivided the island into plots and sold 3 undivided quarters of each plot to private individuals. Simonton spent the winter in Key West and then the summer in Washington to lobby for development of the island and for the establishment of a naval base. Among other first founders are Pardon Green who moved there permanently and became a prominent businessman. John Whitehead lived there for 8 years and partnered with Greene in the firm of “P.C. Greene and Company”. He left the island for good in 1832 returning only once during the Civil War. John Fleeming, active in the mercantile business in Alabama was a friend of Simonton. He spent only a few months in Key West before leaving to marry in Massachusetts. He returned to Key West intending to develop the slat manufacturing of the island but died soon after. The names of these founding fathers of modern Key West used as names for the main arteries of the island.
Many residents of Key West emigrated from the Bahamas. They were known as Counch. They arrived in ever increasing numbers after 1830. Sons and daughters of Loyalists fled to the nearest British soil during the American Revelation. Many of residents of Key West refer to themselves as Conchs and the term is now generally applied to all residents of Key West. The term “Fresh Water Counch” refers to a resident not “native born” but who has lived there for more than seven years. The name is derived from the tradition of placing a conch shell on a pole at the home of a new born baby.
“Bahama Village” is an area of Old town next to the Truman Annex largely inhabited by Bahaman immigrants.
Fishing, salt production and ocean salvage were major industries in the early 19th century. The salvage operations made Key West the largest and richest city in Florida and residents had a high concentration of fine furniture and fancy chandeliers which the locals used in their homes after taking them from shipwrecks on the Florida reefs.
During the Civil War Fort Zachary Taylor was established in Key West after Florida seceded and joined the confederate States of America. It was an important outpost and now contains the largest collection of Civil War cannons ever discovered in a single location.
In 1912 Key West was connected to the Florida mainland via the Overseas Railway extension. The railway created a landfill at Trumbon Point for rail yards. In 1935 the Labor Day Hurricane destroyed much of the railroad and hilled hundreds. About 400 World War I veterans living in camps there working on federal road projects and mosquito control projects in the Middle Keys were also killed. It was too expensive to restore the railroad. In 1938 The Federal Government rebuilt the rail lines as an automobile highway. Completed in 1938 it became an extension of the US Highway 1. The portion of US 1 running though the Keys is called the Overseas Highway.
Numerous artists and writers have come to the Keys but the two most associated with the island are Ernest Hemmingway and Tennessee Williams. Hemmingway reportedly wrote 2 novels “A Farewell to Arms” and “To Have and Have Not” while living in the Keys. The Ernest Hemingway House and Sloppy Joes Bar have become important tourist’s attractions. The Hemingway House is currently inhabited by six or seven toed polydactyl cats descended form Hemingway’s original pert named “Snowball”. The cats live on the grounds and are cared for by the Hemingway House even though the USDA complains about the number of them housed there. The Key West City Commission exempted the house from a law prohibiting more than four domestic animals per household.
Tennessee Williams is said to have written the first draft of “A Streetcar Named Desire” while staying at the La Concha Hotel. He bought a permanent house and listed Key West as his permanent residence. Williams’ home in the “unfashionable” New Town neighborhood is quite the contrast to the elegant Hemingway house. It is a very modest bungalow. The house is privately owned and is not open to the public. The Tenn4essee Williams Theatre is located on the campus of Florida Keys Community College on Stock Island.
Key West is much closer to Havana than to Miami. In 1890 it had a population of nearly 18,800 which made it the richest and biggest city in Florida. The population was nearly half Cuban descent and the city had a succession of Cuban mayors. Cubans were reportedly active in nearly 200 factories in town producing cigars.
The Battleship Maine was blown up after sailing from Key West to Havana which ignited the Spanish American War.
Pan American Airlines was founded in Key West to fly visitors to Havana.
John Kennedy used the phrase “90 miles to Cuba” in his speeches against Fidel Castro.
There were regular ferry and airplane services between Key West and Havana until the revelation in 1959. Refugees flooded into Key West during the Mariel Boatlift and continue to come across the dangerous stretch of waters.
In 1982 Key West and the rest of the Keys tried to declare independence and become the “Conch Republic” in a protest over US Border Patrol blockades. The blockade was set up in response to the Mariel Boatlift. This blockade created a 17 mile traffic jam when the Border Patrol stopped every car to search for illegal immigrants. The Florida Keys were virtually paralyzed as tourism nearly ground to a halt. Couch Republic flags and T shirts are still popular souvenirs for visitors. The Counch Republic Independence Celebration is celebrated each April 23.
Key West was always an important military post. At the beginning of World War II the Navy built the first water line extending the length of the Keys to serve the Naval Air Station. The main facility on Boca Chica is where the navy trains pilots. There are 3400 civilians and 16oo active duty military personnel along with family members. The area next to the old For Taylor became a submarine pen and was used for the Fleet Sonar School.
I tobacco by the pound and roll my own cigarettes. I paid $14.49 for it. Sense the Tax rape it is now $60.00 per pound. The cheapest I can get it is $45.00 Per Pound, but there is no way to get it because of the run on it and the discount stores will not carry it anymore due to a deposit that has to be retained for it. The cheapest generic Pack Cigarette is now $5.00. The premium Cigarettes Went off the chart. I know not Everyone is stopping smoking. I know there is a solution for us financially challenged people to continue smoking. What is it? Spill your guts, tell your secrets, tell you resources and give me and or the rest of us a reliable connection. Oh! And FYI to those non-smokers out there. I appreciate your concern for mine and everyone elses health that uses tobacco, but this is not the question being addressed here. I am addressing those hard core, dyed in the wool tobacco users. If you are so concerned about our healths, why don’t you tell and or get everyone concerned ( medical field, government, ect.ect) to quit making it so difficult to stop useing tobacco products ie. fleecing us with the high prices of those products that enable us to stop. You that don’t have an idea about tobacco addiction, please refrain from making any comments or remarks. This is serious as you have no idea the affects of withdraw from tobacco use. There is going to be a bunch of ANGRY! Grouchy! PISSED OFF! people ready to kick butt on or about the 12th hour of withdraw. It don’t make you sick or weak or any of those other things that junkies go through, You just get angry very fast and your adridline kicks in high speed and become aggressive. Unfortunealty ladies and gentlemen, the problem with getting tobacco from sources ie. indian reservations or on-line, by the time you pay the shipping and taxes to get it into texas it come out to the same price as if I bought it here.
As far as smoking a pipe, well lets think about that, I bag tobacco, which is also used as pipe tobacco but much cheaper than pipe tobacco. Please read the question thouroughly and understand what your reading before you answer. Thank you.
Wedding is the one time of life when the bride wishes to dress like a princess. But bridal trousseau has also undergone a change. Earlier, it was the bridal lehenga choli designed exclusively by the designers. Nowadays, things are changing and people are going back to the roots.
Designs With A Difference
Bridal trousseaus are no more confined to the once popular umbrella cut lehenga choli. More and more brides are open to experimentation. They are again going back to traditional clothing. Instead of spending a bomb on the designer lehenga choli or even sari, brides are opting for the regional look. The brides of the day with well toned bodies prefer to flaunt their curves instead of being fully covered. Designers like Ritu Kumar and Sabyasachi believe that the bride should be the brightest of all in the gathering. More and more brides are opting for the Durga and Devyani Pochampally sarees for a chic and gorgeous look. Devyani pochampally usually comes in bright color combinations with intricate zari border.
Designs To Look Forward
Now heavy designs are considered not so cool. Brides prefer to wear light stuff during the wedding rituals. You can opt for the Diya pochampally, esha pochampally, or drashti pochampally sari for the bridal wear. Forget about age old zari and gota work as now the designs are at par with the regional specific look. Earlier the replica of the royal wedding trousseaus was quite popular and expensive too. You can go for the sarees and get custom made designs on them. Designs you could go for include unpolished zari work, or expensive crystals for exotic look. Crystals, pearls, rubies, zircon and unpolished stones can also be used. The heavy work will push the overall price of the sari towards the higher end, so be prepared to spend a little more.
Look Haute
If you wish to keep the sari simple, be innovative with the blouses. The latest trends in cholis are at par with the fashion week standards. Tube top and backless single piece cholis are in fashion. Halter neck blouse with work on the strings and back is quite haute. The fashionistas are opting for backless blouses in to flaunt their unique mehendi designs on their back. Sometimes it also becomes necessary to go for flashy blouses in to flaunt the heavy and intricate jewelry worn by the bride. Asymmetrical cuts with heavy motifs are a favorite option with brides sporting the leaner look. Many brides prefer blouses with interesting cuts and heavy designs and simpler lehengas.
Back To Tradition
More brides prefer to wear the traditional sari on their wedding. It is considered to be the most gorgeous amongst the entire range of Indian saris. With intricate zari border and ravishing color combinations, the bride looks surreal after draping it. Even former Miss World and actor Aishwarya Rai wore a traditional Pochampally sari on her wedding. If stars prefer to dazzle in their natural aura, why canÆt you? Let simplicity be your mantra to look ravishing on your wedding day.
Jasnav is a leading stylist and fashion writer. Choose from a wide variety of at Visit our blog to read more ideas about and traditional interior d?cor ideas.