Treasury management (Berger Paints Bangladesh limited)

Abstract

Berger Paints Bangladesh Limited has acquired commendable reputation by providing sincere personalized service to its customers in a technology based environment since its inception. The organization has set up a new standard in financing in the Industrial, Trade and Foreign exchange business. The main objective of the study is to analyze and evaluate the treasury management procedure and performance of Berger paints Bangladesh Limited. BPBL is the market leader in the paint industry who holds 55% market Share .BPBL has eleven sales offices around the Bangladesh. The sales proceeds are collected through Citi N/A bank which is the mother bank of BPBL. The company uses SAP software for their daily financial works. This software performs the required function of speeding up the cash receipts and payments as well as provides greater accountability which enables the management at the top to take efficient decisions in regards of the liquidity available. For efficient liquidity management Treasury department is able to make payment to its creditors as early as possible. BPBL has strong and good liquidity position and had no opportunity to run out from short-term financial solvency. BPBL has strong and good liquidity position and had no opportunity to run out from short-term financial solvency and this ability rises gradually (Current/Quick/Cash).BPBLs most of debts consist of creditors and accrual so BPBLs borrowing cost is insignificant. As a result BPBL is in good position regarding borrowed money compared to the resources invested by the shareholders (Debt to equity ratio).BPBLs asset-liability management efficiency increased day by day. BPBL is the less leveraged company and it has lower financial risk (Total Debt Ratio).The company is also able to use its assets and equity efficiently and effectively. The company increases its sales through inventory control and was efficiently managing and selling its inventory so BPBL tied up the fewer funds. The gross profit margin ratio is highly satisfactory and ROA shows that BPBL is more profitable. The EPS had a gradual increase trend which is a good profitability indicator of BPBL. Berger’s profit after tax has a clear indication of its financial viability. ROE under Du-Pont analysis of BPBL indicates operating efficiency, asset use efficiency and financial leverage of BPBL is reliable. Finally BPBL is showing an upward trend in every aspect of financial statements.