Assignment on

Voltamp Transformers ltd.

Supervised To
Dr. Sachin
Submitted By
Reet Gill
Roll No. RQ2145B10
Regd. No. 12112240
Department of Management
MITTAL BUSINESS SCHOOL
LOVELY PROFESSIONAL UNIVERSITY
PUNJAB
2021

Introduction
Voltamp Transformers Ltd. Was initially incorporated as private limited
company and established in year 1967 in Vadodara. Further , by special
resolution passed by the shareholders under section 31 and 44 of the
companies act , 1956 , the company has been converted private limited to
public limited company with effect from 22.02.2006.
The company has installed facility to manufacture oil filled power and
distribution transformers up to 160MVA , 220Kv class , resin impregnated dry
type transformers up to 5 MVA , 11kv class (in technical collaboration with
MORA , GERMANY) and cast resin dry type transformers up to 12.5 MVA , 33
kV class (in technical collaboration with HTT , GERMANY). There are two plants
located at;
1. Makarpura , Vadodara , Gujrat for Power Transformers and 2. Village
vadadla , tehsil savli , district Vadodara , Gujrat for distribution and dry
type transformers. We have started this new unit at savli for
manufacturing of Oil filled distribution transformers and dry type
transformers.
The company recives orders from various orders from various government and
semi-government projects , refineries , fertilizer plants , various other
industries and state electricity boards. Many of these of transformers are
specified by consulting engineering companies. Besides India , the company
has presence in Nepal , Bhutan , Indonesia , Sri Lanka and Middle east Asia.
The company has received an ISO 9001 certification from KPMG Peat Marwick
LLP , USA for its quality management.
Products
Oil filled transformers- Under this category company manufactures power and
distribution transformers.
Cast resin(dry type) transformers- Under this , the company manufacturer cast
resin power and distribution transformers , converter transformers ,
transformers with On Load Tap Changers(OLTC) , motor- starting
transformers , testing transformers , etc.
Unitised sub-station- The company manufacturers HT switchgear ,
Transformer and LT Switchgear and associated equipments to form a
composite compartmentilased unitized sub-station.
Induction Furnace – it also manufactures induction furnace , which has coil
constructed from heavy copper tubing. It is designed and tuned to the inverter
circuit which applies a medium frequency (generally 500 Hz or 1000 Hz)
voltage to the induction coil. The magnetic field produced by the induction coil
induces eddy currents in the charge and heats it. Medium frequency is
necessary to enhance the rate of heat generation.
The company also provides services related to all aspects of assembly ,
commissioning , maintenance repairing and trouble shooting of transformers.

Directors of the Company

Vice chairman & MD : Kunjal Patel
Chairman & Managing Director : Kanubhai S Patel
Whole Time Director & CFO : Vallabh N Madhani
Non-Exec. & Independent Director : Hemant P Shaparia
Company secretary : Sanket Rathod
Non-Exec. & Independent director : Ashish S Patel
Non-Exec. & Independent Director : Paulomi J Lashkari
Addtnl Independent Director : Rajendra C. Patel
Director : Tarak K. Patel
Auditor : CNK & Associates LLP
IND Name : Electric Equipment
House Name : Indian Private

Mission of the company

The company has installed facility to manufacture Oil filed power and
distribution transformers up to 160 MVA , 220 KV class. VOLTAMP derives its
strength from its customers. The growth of the latter is pre-requisite to the
growth of the company and hence customer satisfaction is the prime objective.
Over the years of sincere service and dedication to its customers has earned
the company distinguished customers which includes leaders in government
and semi-government projects. Refineries , fertilizers plants , cement , steel ,
chemical , pharma , paper , various other industries and state electricity boards
in India as well as abroad also.
 COMPARATIVE BALANCE SHEET OF VOLTAMP LTD.
PARTICULARS AMOUNT (IN
CRORES)
March 2021 March 2020 March 2019
EQUITIES AND
LIABILITIES
SHAREHOLDERS’S
FUNDS
EQUITY SHARE 10.12 10.12 10.12
CAPITAL
TOTAL SHARE 10.12 10.12 10.12
CAPITAL
RESERVES AND 824.02 738.10 676.61
SURPLUS
TOTAL RESERVES 824.02 738.10 676.61
AND SURPLUS
TOTAL 834.14 748.22 686.72
SHAREHOLDERS
FUNDS
NON-CURRENT
LIABILITIES
LONG TERM 0.00 0.00 0.00
BORROWINGS
DEFERRED TAX 0.00 0.00 3.79
LIABILITIES[NET]
OTHER LONG TERM 0.00 0.00 0.00
LIABILITIES
LONG TERM 11.00 8.04 6.52
PROVISIONS
TOTAL NON- 11.00 8.04 10.30
CURRENT
LIABILITIES
CURRENT
LIABILITIES
SHORT TERM 0.00 0.00 0.00
BORROWINGS

TRADE PAYABLES 6.80 6.90 1.05

OTHER CURRENT 51.08 46.01 46.72
LIABILITIES
SHORT TERM 7.39 7.71 5.81
PROVISIONS
TOTAL CURRENT 65.28 60.62 53.57
LIABILITIES
TOTAL CAPITAL 910.42 816.88 750.60
AND LIABILITIES
ASSETS
NON-CURRENT
ASSETS
TANGIBLE ASSETS 52.26 56.72 46.57
INTANGIBLE 0.42 1.00 1.56
CAPITAL WORK IN 8.29 1.22 0.22
PROGRESS
OTHER ASSETS 0.00 0.00 0.00
FIXED ASSETS 60.97 58.94 48.36
NON-CURRENT 468.84 417.08 360.90
INVESTMENTS
DEFERRED TAX 0.38 2.55 0.00
ASSETS[NET]
LONG TERM LOANS 0.00 0.00 13.89
AND ADVANCES
OTHER NON- 19.07 19.71 2.46
CURRENT ASSETS
TOTAL NON- 549.25 498.27 425.60
CURRENT ASSETS
CURRENT ASSETS
CURRENT 23.42 36.85 20.40
INVESTMENTS
INVENTORIES 127.31 115.55 107.68
TRADE RECIEVABLE 170.72 150.28 176.58
CASH AND CASH 20.26 6.00 11.39
EQUIVALENTS
SHORT TERM 0.22 0.28 0.68
ADVANCES
OTHER CURRENT 19.23 9.65 8.28
ASSETS
TOTAL CURRENT 361.17 318.61 325.00
ASSETS
TOTAL ASSETS 910.42 816.88 750.60
Analysis of the Balance Sheet
The balance sheet of the voltamp transformers suggests that , the non
current liabilities of the company has increased as compared to the
previous last two years. The total non current liabilities of the company
in year 2019 was 10.30 while in 2020 it was 8.04. in the year 2021 it
increased to 11.00. it increased because company had apparently
increased their long term provisions in the year. The current liabilities of
the company has also taken a hype it was 60.62 and 53.57 in the years
2020 and 2019. In 2021 it rose to 65.28. This indicates that company is
taking higher financial risks. All this resulting in making the total capital
and liabilities of the company at 910.04 in the year 2021.
While on the other hand the fixed assets in the hands of the company
were also increasing by each passing year. It was 48.36 in 2019 , 58.94 in
2020 and 60.97 in year 2021. Increasing assets are a sign that company
is growing , but the main focus should be that the assets are used in a
proper manner , the goal is to determine how asset growth of the
company is financed. At the end of the year the total assets of the
company for previous last stood as such , 2019- 750.60 , 2020-816.88
and 2021-910.42. this indicates that company is in a position to meet its
current liabilities and is prospering every year. The higher the result the
better. Low total assets would indicate that the company is unable to
pay-off its short term debts.

Analyze The Liquidity , Efficiency & Solvency Position

Of The Company Through Ratios
Particulars March 2021 March 2020

Current ratio 4.84 4.89

Debt equity ratio 0.00 0.00

Debtor turnover ratio 4.31 5.25

Proprietary ratio 8.11 11.39

1. Current ratio- The current ratio is liquidity ratio that measures a
company’s ability to pay short term liabilities. It tells investors how a
company can maximize the current assets on its balance sheet to satisfy
its debtors. The standard current ratio is 2:1

Formula -: current ratio = current assets / current liabilities

In year 2020 the company had current ratio of 4.89 while in year 2021 it
dropped slightly to 4.84. In each case it depicts that company had
enough currents assets to pay off its debts.

2. Debt equity ratio- The debt equity ratio is a leverage ratio that
calculates the weight of the total debts of the company and financial
liabilities against total shareholders. High debt ratio is a sign of risk.
Formula-: debt equity ratio = total liabilities / shareholder
equity

The debt equity ratio of the company has stood still at 0.00 for the both
the years . 2020 and 2021. This indicates that the company has been
paying off its debts time to time reason being high current ratio.

3. Debtor turnover ratio – debtor turnover ratio is the relationship

between net sales and average debtors. It is also called account
recievable turnover ratio.
Formula-: debtor turnover ratio = net credit sales / average
trade recievables

The debtor turnover ratio of the voltamp transformers has decreased

from year 2020 to 2021 which is not a good sign as more debtor
turnover ration means more company has high level of recievables.

4. Proprietary ratio- Proprietary ratio is a type of solvency ratio that Is

useful for determining the amount of contribution of sahreholders
towards the total assets of the company. The main purpose of this ratio
is to determine the proportion of the total assets of the company.
Formula-: proprietary ratio = stockholders equity /total assets * 100
The proprietary ratio of the company has decreased in year 2021 as
compared to year 2020 which indicates that company has not been
efficient in paying off its debts in the latter year. Voltamp tranformers
donot have a strong financial position.

Invest in the shares of the company or not

As per the given information above and from the analyses , I would have
a double mind to invest in the company or not. Because on one hand it
has been able to pay off its debts in the previous years , while on the
other it has amd even has an increase in the total assets of the company.
But considering the ratios , the company has been successful in paying
off its debts while the proprietary still showed a downfall , which
indicates that the company has not been using its assets in an
appropriate manner. Investing money in such a company would be a big
risk bearer , so I would think twice and even suggest to do so.