Micro, Small and Medium Enterprises (MSME) plays an important role in development of country. Itcontributes high share of GDP. It not only contributes to GDP but also provides employment in ruralarea, by which, standard of living of people will increase and unemployment rate will be low. Theyare source of growth in developing and transitioning economies. It contributes 90% of the totalenterprises in developed countries and it helps to strengthen the economy, creates employmentopportunities for skilled, semi-skilled and unskilled, and increases the standard of living; as a result,there will be an increase in GDP rate. Both the Central and State Governments should give priorityfor the development of this sector by making them more competitive. This study makes an attempt tofocus on the operational efficiency and understand the ethical aspects. The study evaluates thefinancial aspects of the company through making use of ratio analysis and provides recommendationsto the organization. This research has been done to find out main areas of risk and what measureentrepreneurs are taking to be away from going on crises. The study is descriptive in nature. It ispurely based on secondary data sources, which comprises of Balance sheet, Profit and LossAccount and Tax Returns. The business was established in 2010. As it is unable to penetrate themarket properly in the initial years the capacity utilization is poor. As a result, it was declared asNPA in 2013. The promoters and the management are keen in reviving the unit. As a part ofresolution, they started improving the capacity utilization, trying to reduce the debt and improving theworking capital etc. It is appearing that the restructuring process is going on well. The company'sliabilities are more and we can see that the Net Profit for the past three years is negative which showsthat the company is not able to perform well. In the year 2012 and 2013, the company raised loanfrom Vijaya Bank and it had an overdraft balance from the same bank; and in 2015, the companyagain raised a loan from three more parities; they are Bajaj Finance, Fullerton India and Religare.The interest coverage ratio is declining, indicating that the company is unable to pay interest onoutstanding debts. Finally, it is concluded that the company's overall performance is not good. But, ifit takes, appropriate measures, the firm will be at least able to meet its short term needs (workingcapital).
