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INTRODUCTION
Capital is primary need of an enterprise, for any uninterrupted productions of goods & services, an organization needs two types of assets and these are fixed assets and current assets. Capital requirements for fixed assets are estimated first then the assessment is made for the capital that would be needed to ensure smooth functioning of the enterprise.
A manufacturing company requires fund to maintain adequate size of raw material stock to ensure uninterrupted production activity. Likewise sufficient stock of finished goods has also to be maintained in the anticipation of future demands. To meet this purpose, a firm would need capital. Some of the items may be in semi-finished stage and capital gets blocked until they get through the final stage of production and are sold in the market and debtors get released. Credit Sales give rise to a situation to arrange funds to finance the accounts receivable for the period until they are collected.
Some fund is also required to meet the expenses against wages & overheads. Further, the firm has to hold special cash reserve to avail the advantages emanating from business opportunities .Since uncertainty is always a characteristic of business. Sufficient cash should be maintained as insurance against unexpected adversities. It may be concluding that capital is to be arranged for the following areas to ensure day –to–day operation of the firm:-
i. Building up the inventories.
ii. Financing receivables
iii. Covering day –to–day operating expenses of the firm & providing insurance against contingencies.
The above assets, needed to carry on the production and distribution activities of a business to pay liabilities as they become due and act as a protection for short term creditors, are termed as current assets. Capital invested in these assets is ordinary referred to as the “WORKING CAPITAL”.
With the wide dimension of business & his environment. Working Capital Management has its own importance and it has emerged as a distinct area of decision making in Financial Management. The modern conception approach in the business world with cut – throat competition give working capital management a dignified place since judicious Working Capital Management has a far reaching effect on the prosperity and survival of the business firm.
In this reports attempt have been made to throw light on conceptual aspects of working capital management as well as its components along with analytical tools and technique for practical application.
OBJECTIVE OF STUDY
The objective of study is : -
i. Our curiosity to get acquainted with the overall system of management of finance in HEC.
ii. The know more about the financial performance of the organization which is our source of bread and butter, being a member of the HEC family.
iii. To undergo an in- depth study of working capital Management in HEC with a focal point on receivable management and inventory management area where the company is ailing.
iv. To prepare a Project Report on the company’s Working Capital Management as a part of our study in the Financial Management.
RESEARCH METHODOLOGY
 In research method, marketing often use formal marketing studies of specific problems and opportunities. They May request to market survey for a product- preference test, a sale forecast and an evaluation.
 Thus, we as management trainee have gathered needful information for the purpose of preparing project report.
 Our topic is “WORKING CAPITAL MANAGEMENT.” for collecting the information; we adopted both methods, primary as well as secondary. Primary in the sense that we contacted with some employees, and Managers and got some valuable information about this corporation , on the other hand, secondary data in the sense that we Consulted several sources like, HEC’s ANNUAL REPORT , HEC MANUAL, Magazines and Internet for collecting valuable data and information.
A BRIEF HISTORY OF HEC
On the auspicious day of 31st December, 1958 took birth a giant engineering concern in the horizon of chhotnagpur belt with the establishment of the Heavy Engineering Corporation Limited. Considered to be the pioneer of the engineering Sector of India. It has three manufacturing units, located at Ranchi .
These are :
01. Foundry Forge Plant
02. Heavy Machine Building Plant
03. Heavy Machine Tools Plant
Apart from these three plants. The company has a Project & Consultancy Division. The company has also established a few branch offices at Delhi, Calcutta, Hyderabad and Nagpur for the supply of machines , tools & spares to industry like steel, mines ,cement , fertilizer , railways & defence establishments.
The Company has an authorized Share Capital of Rs.300 crores divided into 3000000 equity shares of Rs. 1000 \ each and is fully owned by the Government of India.
FOUNDRY FORGE PLANT
Foundry Forge Plant has the credibility of would fame in the Foundry & Forge Technology. It is one of the largest of its kind in the world. The covered area of the plant is 13, 16,930 sqrs.mtrs. With a fenced area of 28.80,000 sq.mtrs. The plant has the capability to produce different types of sophisticated, intricate Heavy Casting, Forgings required fot its sister plant – HMBP & HMTP. It also manufactures casting. Forging & rolls of different size & type to meet requirements of industries like Steel, Mining, Sugar, Cement, Defence, Railways etc.
The plant has the following production shops: -
 Grey Iron Foundry.
 Steel Foundry.
 Forge Shops.
 Machine Shops.
 Roll Manufacturing Shops.
 Pattern Shops.
The plant is equipped with : -
Arc Furnace of capacity upto 60 tons.
Hot Blast Coupler.
Hydraulic Forging Presses of capacity up to 6000 tons