Financial management comparison

Subject: financial management



Topics:
INDIAN HOTELS LTD.
EIH
ASIAN HOTELS (NORTH)








SUBMITED BY,
SHRADDHA SAWANT ,43
RUTIKA MORE,33
RAHUL MORE,32
SANKET TADGE ,48
KISHORE TAMHANKAR,49
MONISHA MOOLYA,
NAGRAJU CHIDIRALA,
SIMEEN KHAN,












Q1.What according to you are the industry prospects of the respective
company for the next five years and why?

Indian Hotels Ltd.
Competition from international hotel chains
High operating leverage with further increase with on-going renovations and product upgrades
Increase in foreign exchange fluctuation risk

EIH Ltd.
Increase in employment level
Increase in hotel industry business
Expansion through development

Asian Hotels (North)
Increase in revenues from food and beverages
Undertaking projects for expansion and development
Domestic tourism will continue to remain robust in future
Why:
The Government of India's Incredible India destination campaign and the Atithi Devo Bhavah campaign have also helped the growth of domestic and international tourism and consequently the hotel industry.
In recent years the government has taken several steps to boost travel and tourism, which have benefited the hotel industry in the country. These include the abolishment of the inland air travel tax by 15%, reduction in excise duty on aviation turbine fuel to 8% and removal of a number of restrictions in excise on outbound chartered flights including those relating to frequency and size of aircraft. The government's decision to treat convention centres as part of core infrastructure has also fuelled the demand for hotel rooms.

Q2.Do a SWOT analysis and try to fit the companies strength to the available opportunities in the environment?
INDIAN HOTELS COMPANY LIMITED: 
"The Indian Hotels Company Limited: SWOT Analysis & Company Profile" reports utilize a wide range of primary and secondary sources, which are analyzed and presented in a consistent and easily accessible format.
Business Review strictly follows a standardized research methodology to ensure high levels of data quality and these characteristics guarantee a unique report.

Scope:
- Examines and identifies key information and issues about (The Indian Hotels Company Limited) for business intelligence requirements.
- Studies and presents The Indian Hotels Company Limited's strengths, weaknesses, opportunities (growth potential) and threats (competition). Strategic and operational business information is objectively reported.
- The profile contains business operations, the company history, major products and services, prospects, key competitors, key employees, locations and subsidiaries.

Reasons To Buy:
- Quickly enhance your understanding of the company.
- Obtain details and analysis of the market and competitors as well as internal and external factors which could impact the industry.
- Increase business/sales activities by understanding your competitors' businesses better.
- Recognize potential partnerships and suppliers.
- Obtain yearly profitability figures.
EIH LIMITED:

World Market Intelligence's "EIH Associated Hotels Ltd. (EIHAHOTELS) : Company Profile and SWOT Analysis" contains in depth information and data about the company and its operations. The profile contains a company overview, key facts, major products and services, SWOT analysis, business description, company history, financial analysis, key employees, company locations and subsidiaries, employee biographies as well as competitive benchmarking data.
Summary:
This report is a crucial resource for industry executives and anyone looking to access key information about "EIH Associated Hotels Ltd."
The report utilizes a wide range of primary and secondary sources, which are analyzed and presented in a consistent and easily accessible format. World Market Intelligence strictly follows a standardized research methodology to ensure high levels of data quality and these characteristics guarantee a unique report.
Scope:
Examines and identifies key information and issues about "EIH Associated Hotels Ltd." for business intelligence requirements.
Studies and presents the company's strengths, weaknesses, opportunities (growth potential) and threats (competition). Strategic and operational business information is objectively reported.
Provides data on company financial performance and competitive benchmarking.
The profile also contains information on business operations, company history, major products and services, key employees, and locations and subsidiaries.
Reasons to Buy:
Quickly enhance your understanding of "EIH Associated Hotels Ltd."
Gain insight into the marketplace and a better understanding of internal and external factors which could impact the industry.
Increase business/sales activities by understanding your competitors businesses better.
Recognize potential partnerships and suppliers.
ASIAN HOTELS (NORTH) LIMITED:
Asian Hotels (North) Limited (ASIANHOTNR) : Company Profile and SWOT Analysis" contains in depth information and data about the company and its operations. The profile contains a company overview, key facts, major products and services, SWOT analysis, business description, company history, financial analysis, key employees, company locations and subsidiaries, employee biographies as well as competitive benchmarking data.
Summary:
This report is a crucial resource for industry executives and anyone looking to access key information about "Asian Hotels (North) Limited"
The report utilizes a wide range of primary and secondary sources, which are analyzed and presented in a consistent and easily accessible format. World Market Intelligence strictly follows a standardized research methodology to ensure high levels of data quality and these characteristics guarantee a unique report.
Scope:
Examines and identifies key information and issues about "Asian Hotels (North) Limited" for business intelligence requirements. - Studies and presents the company's strengths, weaknesses, opportunities (growth potential) and threats (competition). Strategic and operational business information is objectively reported. - Provides data on company financial performance and competitive benchmarking. - The profile also contains information on business operations, company history, major products and services, key employees, and locations and subsidiaries.
Reasons to Buy:
Quickly enhance your understanding of "Asian Hotels (North) limited" - Gain insight into the marketplace and a better understanding of internal and external factors which could impact the industry. - Increase business/sales activities by understanding your competitors' businesses better. - Recognize potential partnerships and suppliers.




Q3.As the member of the board of directors of the company you are required to prepare a growth strategy for the respective companies for next 3 to 5 years
Indian Hotels Ltd.
43 more hotels in India
Maintaining more success in long run
Expanding business in overseas market
Promoting India as a tourism destination
EIH Ltd.
Exceeding the expectations of guests with dedication to perfection to every aspect of service
Development and welfare of employees
Creation of value for shareholders

Asian Hotels (North)

Delhi property is set to get even bigger with the addition of 35 additional rooms 
Brand new tower with a total built area of around 1.66 lakh square feet. 
Increasing cash flow from operations

Q4.How should the company finance their growth plans with justification for opting a particular source of finance?


Owners capital
 The money may be the result of savings, money left to them by a relative in a will or money received as the result of a redundancy payment. This has the advantage that it does not carry with it any interest. It might not, however, be a large enough sum to finance the business fully but will be one of the contributions to the overall finance of the business.

Retained profit
This is a source of finance that would only be available to a business that was already in existence. Profits from a business can be used by the owners for their own personal use (shareholders in plcs receive a share of the company profits in the form of a dividend - usually expressed as Xp per share) or can be used to put back into the business. This is often called 'ploughing back the profits'.

Selling asset
As firms grow they build up assets. These assets could be in the form of property, machinery, equipment, other companies or even logos. In some cases it may be appropriate for a business to sell off some of these assets to finance other projects.
Shares
A share is a part ownership of a company. Shares relate to companies set up as private limited companies or public limited companies (plcs). There are many small firms who decide to set themselves up as private limited companies; there are advantages and disadvantages of doing so. It is possible, therefore, that a small business might start up and have just two shareholders in the business.
If the business wants to expand, they can issue more shares but there are limitations on who they can sell shares to - any share issue has to have the full backing of the existing shareholders. PLCs are different. They sell shares to the general public. This means that anyone could buy the shares in the business.


Q 5) Would u recommend any change in the capital structure of the companies & what according to you would be an appropriate capital structure with justification?
DEFINITION OF 'CAPITAL STRUCTURE'
The capital structure is how a firm finances its overall operations and growth by using different sources of funds.
Debt comes in the form of bond issues or long-term notes payable, while equity is classified as common stock, preferred stock or retained earnings.
Debt equity ratio
It indicates what proportion of equity and debt the company is using to finance its assets.
Debt equity ratio = Long term debt / Shareholders equity
INTEREST COVERAGE RATIO
A ratio used to determine how easily a company can pay interest on outstanding debt.
Intrest coverage ratio= EBIT/Intrest
For Asian Hotels (North) Limited
As per company's balance sheet for year 2013-14 company's capital structure is

(Rs. In Lakhs)
(Rs. In Lakhs)
Year
2014
2013
Owners fund
80271.81
87329.63
Debts
74099.17
66198.4
Debt equity ratio
0.92
0.76






EBIT
11635.17
9688.65
Intrest
7341.70
5232.37
Intrest coverage ratio
1.58
1.85



PAT
-2366.32
2944.65


Capital structure of Asian Hotels (North) Ltd. For year 2013-14 comprises of owners fund of 80271.81 & 87329.63 lakhs as shown in above table as we can see company have nearly equal amount of debt compared to shareholders fund and company have Interest coverage ratio of 1.58 & 1.85 for year 2014 & 2013 respectively it shows that companies not in good condition to service their future debts by interest through their earnings.
Company have incurred losses in 2014 if they borrowed more funds then it will result in more interest and which will further leads to more loses. So it is advisable not to go for further debt borrowings for capital expenditure while company can increase their shareholding by FPO because there is no need to pay interest on equity the dividend on equity is not mandatory.
So by analyzing this situation we can conclude that it will be better to go for equity rather than debts or let the capital structure as it is.
For EIH Limited
As per company's balance sheet for year 2013-14 company's capital structure is

(Rs. In Lakhs)
(Rs. In Lakhs)
Year
2014
2013
Owners fund
264758.60
262492.40
Debts
10,351.70
14,428.20
Debt equity ratio
0.04
0.05






EBIT
18543.20
11684.30
Intrest
4065.00
4501.30
Intrest coverage ratio
4.56
2.60



PAT
9504.10
5096.40





Capital structure of EIH Ltd. For year 2013-14 comprises of owners fund of 264758.60.81 & 10,351.70 lakhs as shown in above table as which results in debt equity ratio of 0.04 & 0.05 for year 2014 and 2013 respectively which is negligible and company have Interest coverage ratio of 4.56 & 2.6 for year 2014 & 2013 respectively it shows that company is capable to service their future debts by interest through their earnings.
Company have profit of 9504.10 lakhs in 2014.
So by analyzing this situation company can use debt to finance their capital expenditure as they have negligible debts they can expand their capital using debts.
For THE INDIAN HOTELS COMPANY LIMITED
As per company's balance sheet for year 2013-14 company's capital structure is

(Rs. In Crores)
Year
2014
2013
Owners fund
2693.84
3307.65
Debts
2,153.51
2,268.13
Debt equity ratio
0.80
0.69






EBIT
-422.08
-104.59
Intrest
98.82
105.20
Intrest coverage ratio
-4.27
-0.99



PAT
-590.49
-276.61

Capital structure of Asian Hotels (North) Ltd. For year 2013-14 comprises of owners fund of 2693.84 & 2,153.51 (Rs. In Crores) as shown in above table as we can see company have nearly equal amount of debt compared to shareholders fund and company have Interest coverage ratio of -4.27 & -0.99 for year 2014 & 2013 respectively it shows that companies not in condition to service their future debts by interest through their earnings.
Company have incurred losses in 2014 & 2013 if they borrowed more funds then it will result in more interest and which will further leads to more loses. So it is advisable not to go for further debt borrowings for capital expenditure while company can increase their shareholding by FPO as company is already listed NSE & BSE because there is no need to pay interest on equity the dividend on equity is not mandatory.
So by analyzing this situation we can conclude that it will be better to go for equity rather than debt

Q.6 The purpose of the companies to recruit MBA for their future requirements. What attributes would you look in the perspective candidate for functions like Finance, Marketing, HR and Operations?

ITC Grand Central Mumbai

Attributes for accounting and finance department

Communication: They pay close attention to a candidate's ability to communicate. These days it is Important that finance and accounting staff have the ability to speak complex data in layman's terms. Much of the time the people an accounting might liaise with won't be from a financial background (this is specially the case if the candidate is working as a financial business partner)
Managers and board member don't really care about the nuances or the complexities of financial figures the ant to know if what they want is viable or not viable or how their particular business decision is going. Without the ability of effectively communicated technical communication to a company's decision makers, the candidate won't perform well in their role.

Qualification: qualification ofcource still matter. Many clients actually look to those candidates who receive their training through one of the "Big Four": Deloitte, PWC, Ernst and young and KPMG. This is great if it's possible, but they also look for is evidence that an individual ha shown through their qualifications but their intelligence aptitude and willingness to learn.

Product Knowledge: there are vide produces in financial services and these vary significantly across different niche such as investment, banking, funds management and life insurance. With complex legal structures and International Finance Reporting Standards to follow it's very important for originations to have staff familiar with the relevant financial instruments, compliance and disclosures specific o their role.

Attention to details: Accountants may have moved out of the back office into more diverse roles such a business partners but the company still want to see the candidates with the attributes that made accountants successful in the past such a attention to details. The job still deals with the large complex columns of information so attention to detail is a must.

Enthusiasm: During an interview with the candidate, company likes to look someone who is a go-getter, someone who can sell themselves, understand that their role is not just their back office function anymore, and who is enthusiastic about helping the company-they have go to be able to add value



2. Renaissance Hotel Powai

Recruiting is unfortunately often a way station in a career. It is one stop on the way to becoming an HR executive or to moving on to other things. There are often very limited opportunities for advancement as a recruiter within most organizations, which further limits the number of people who choose to dedicate themselves to doing it well. Success also requires abilities that are not necessarily the strengths of those who choose traditional human resources as a career. I have found that many of the most successful recruiters had no intention of working for or in HR. They were interested in sales, marketing, communications, or similar areas and found themselves accidently being asked to do recruiting.
If you take the time to talk to recruiters who have garnered a reputation for success, you will discover that they share a few traits in common.
It is these common interests, inclinations, or skills that differentiate them from all the others. It would be useful to look for these traits whenever you are trying to find more recruiters or to identify those most likely to add the most value.
These recruiters are not real people. They are composite people that I made up from some of the best I have seen and worked with.
Trait 1: Great at networking because they have a strong interest in people
I know this sounds trite, but it is true. Every great recruiter has a need to be around and with people. They like to meet new people and seek out opportunities to do that even when they are not recruiting.
Bill Warren is a great example. He began recruiting when he was just 23 and a new college hire. The college team asked him to help out on campus and he immediately put the network he had developed in his fraternity and social activities to work. As he worked in a technical industry, he put together an on-campus special interest group sponsored by his company. They sent engineers to talk and demonstrate uses for their products in applied situations. With the blessing of his boss, he was able to spend several weeks each semester in campus building the reputation of his firm and their research. Recruiting was easy after the first year and remains that way today. Bill, meanwhile at 28, has become a full-time recruiter, where he is quickly becoming a star. When you ask him why he is successful, he just says: "I like people and want to help them do what they want to do."
His networking skills are massive both in person and online. He cultivates relationships and understands that all solid relationships are built on quid pro quo: doing something for someone who, in turn, does something for you. It is this give and take that makes for success, and he is willing to share his career advice, mentoring skills, and technical expertise. In return he gets the loyalty and commitment of many candidates.
Trait 2: Marketing and influencing skills
Sue Smith is ranked as the top recruiter in her retail organization. Hiring volume is aggressive and needs are changing all the time. Turnover is often high and seasonal hiring presents many challenges. She has to recruit contingent as well as full-time staff, and is involved in lots of internal politics.
Yet, Sue is able to ride these waves and still make progress. While she is a good networker, where she really shines is in influencing and selling. Sue aims to get candidates interested in the work, project, and hiring manager by identifying and communicating their positive aspects, pointing out challenges when appropriate, and generating excitement. She presents well-vetted candidates to the hiring manager whom she has "presold." Through Facebook, email, and phone calls, she uses her networks as marketing channels and targets them for specific functions and sometimes even for specific hiring managers.
Trait 3: Personalizing and leveraging uniqueness
They transcend brand by personalizing each hire and each hiring manager. Each of these recruiters has found the power and importance of personalization. Rather than rely on a generic recruiting brand, they instead brand every job and manager as unique. They know how to steer the right candidates to the right managers because they have deep knowledge of the needs and capabilities of each through their networking skills and ability to influence. While each takes a different approach, there is lots of overlap and commonality between them. They can push and pull candidates and managers toward a mutually desirable end.
Trait 4: They use technology; they are not consumed by it
Neither of these recruiters is a technology nerd. They use what works for them and whatever they can understand. They make sure both candidates and hiring managers also understand and are willing to use the tools.
Bill does this by creating special interest groups that can be either virtual or face-to-face. He lets candidates and managers gravitate toward those that match their interests and abilities. He has leveraged more technology than Sue because his primary candidates are dispersed and distant, but he is not a "techno freak" in any way.
Sue uses technology to enable communication. She has the amazing ability to implement a technology seamlessly by starting out small, experimenting with a few candidates and hiring managers, and growing it slowly when it works. She probably spends no more than one or two days a month where technology is her focus.
Great recruiters are focused on getting results, but what is more important to them is that both the hiring manger and the candidate feel that they have had a real exchange of information and that both are comfortable with the decision. I am amazed that their candidates have few regrets about accepting a job and the short-term turnover is remarkably small. Hiring managers, too, are content and pleased with their hires.
The recruiting process is not about individual recruiters, though. It is about making good matches in a seamless and efficient way. Great recruiters figure out how to do this while appearing almost in the background. The greatest praise you can get is when the hiring manger says, "Wow! Did I make a great hire last week."

3.Sterling Hotel Resort

Attributes for Marketing Executive
To build and maintain strong client relationships by effectively handling objections and resolve member/customer conflicts thus building customer trust.

To build & maintain strong relationships with Direct customer base & channel partners to achieve sales targets.

To identify potential customers, create and close new business opportunities in line with the strategic direction of the company.

To prepare pre-sales proposals for prospective clients.

To make inspiring sales presentations to the prospective clients by creating a dream.

Regular liaison with telemarketing and member relations department to achieve stretched targets in a result-focused environment.

To build and maintain strong client relationship and high level of customer service.

To keep abreast with the organization's products and services and to crack profitable deals and referrals to achieve sales targets.


Human Resource Manager
Plan Campus recruitments to ensure new resources on time.
Monitor Recruitment Gaps & deviations on requirement, budgeted V/s. new recruitments.
Identify and standardize on the tools for selection for people at different levels to ensure quality of hiring across front line sales & Marketing and other support functions.
Identification of consultants for different levels on a cost effective basis.

Post Recruitment:
Conduct Joining formalities for all new hires & receipt of post joining documents.
Ensure issue of appointment orders to all the new joinees on the day Joining.
Ensure creation of Personal files for all the new joiners and send it across to Corporate Office (Chennai) for payroll processing.
Will be responsible for Attendance input & statutory compliance for the entire respective branch

Employee Engagement:
Work closely with senior and line managers, providing them with expert guidance, coaching and support on the full range of HR activities (including policies and procedures, terms and conditions of employment, absence management, restructuring of services, Productivity and performance management, redundancy planning etc.), in order to ensure a consistent and fair approach to people management throughout the Board.
Provide advice and guidance on individual employee relations cases, ensuring that these are well managed and meet the requirements of the Boards policies, best practice and employment legislation.
Develop, implement and maintain HR policies and procedures to ensure effective, fair and consistent management of staff throughout the organization, and ensure that the staff handbook is comprehensive and up-to-date.
Ensure that managers and staff are aware of the policies and procedures and able to operate them effectively.
Provide support to staff on HR issues, as and when required.
Ensure that staff are informed and updated on key business and organizational issues.

Learning and Development:
In consultation with line managers, follow up individual development needs and source external training provision as and when required, monitoring training costs against budget.
Administer the evaluation of all learning and development activities.
To have a fair understanding on the training needs for all staff and assist with any training initiatives, as and when required.

Others
Represent HR and participate in various internal groups and committees across the organization.
Review and manage new starter and leaver processes, including conducting exit interviews for all staff.
Monitor HR trends throughout the organization and provide management information on Key Performance Indicators to the Management as appropriate.
Manage the information held on the HR database and personnel files to ensure it is updated in a timely and accurate manner

Finance department
1. Monthly preparation and review of finance Statements and Cash flows as per Revised Schedule VI
2. Preparation of P&L & Balance Sheet quarterly to comply with SEBI requirements
3. Responsible for preparation and consolidation of Monthly MIS - Revenue trends, Statement of P&L, Balance Sheet and Cash flows in the format required by Management
4. Preparation of back up files and ensuring controls and reconciliations are done every month-Checks and balances
5. Co-coordinating with Statutory Auditors on closure of accounts and addressing the queries by coordinating with various vertical heads- Providing the information as and when required on adhoc basis
6. Cost center review department wise
7. Budgets - Preparation of Balance Sheet and Cash flow based on the numbers reported by vertical heads
8. Preparation of Corporate expenses by coordinating with various departments
9. Advising the team on key accounting issues and policies- Act as a problem solver on various issues raised on Accounting Standards/Revised Schedule VI
10. Co-coordinating special projects- Mergers, IFRS, Revenue recognition assumptions etc. on Financial Reporting and Management reporting