A Project Report On

Essar Steel Limited White Goods

2009

SUBMITTED FOR PARTIAL FULLFILLMENT FOR THE AWARD OF

“POST GRADUATE DIPLOMA IN MANAGEMENT” APPROVED BY AICTE

Under the Supervision of: Submitted By:

Dr. Banasree Dey Romil Jain PGDM 1ST YEAR

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S.NO CONTENTS PAGE NO.

1. INTRODUCTION 3

2. GLOBAL STEEL 4-5

3. STEEL INDUSTRY IN INDIA 6-10

4. ORGANIZATION OF ESSAR GROUP 11-27

5. COMPETITOR MAPPING 28-39

6. IRON AND STEEL MAKING PROCESS 40-41

7. DOWNSTREAM PRODUCTS 42-43

8. RESEARCH METHODOLOGY 50-64

8.1 RESEARCH OBJECTIVE

8.2 SELECTION OF SAMPLE

8.3 DATA COLLECTION METHOD

8.4 DATA ANALYSIS

9. FINDINGS AND SUGGESTION 65-68

10. SWOT ANALYSIS OF ESSAR 69

11. LIMITATIONS AND CONCLUSION 70-71

12. BIBLIOGRAPHY 72

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ACKNOWLEDGEMENT

A thanks giving seems to be the most pleasant of all the jobs but it is difficult when one tries to put it into words. This project has been brought into fruition through the effort of some well experienced people i.e. my mentor and the management team. I take this opportunity to express my special thanks to Mr. Nitin Gupta who guided and helped me in completing this project.

The opportunity and his guidance were of immense learning.

The insight and the guidance of Mr. Nitin really helped me to understand the essentials of my project. I would like to thank him for all support and guidance for my project.

I extend my gratitude to the entire management team for guiding me during the project.

ROMIL JAIN

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INTRODUCTION

The steel industry is expanding worldwide. For a number of years it has been benefiting from the exceptionally buoyant Asian economies (mainly India and China). The economic modernization processes in these countries are driving the Sharp rise in demand for steel. In India the rise is likely to be higher than average. Indian crude steel production will rise from 38 million tonnes in 2005 to 68 million tonnes in 2015.

The continuous casting technology making inroads. The biggest boost to efficiency in the steel industry has come from the increased use of continuous casting – an indicator of the modernity of the production process. Its share of Indian crude steel output has climbed from 38% in the mid-1990s to 66% now. India is thus well on its way to joining the ranks of the leading steelmakers among the industrial nations.

Companies are bursting onto the world market. The Indian steel ministry plans to raise the export share from 15% at present to 24% in the next 15 years. Big companies like SAIL, Tata Steel and Essar Steel want to become global players by acquiring stakes in foreign firms.

India is one of the world’s fastest expanding economies. Over the last ten years the booming economy has posted real growth of 6% p.a., compared with less than 4% in the 1950s and 1960s. In 2005 growth accelerated to about 8%, while in 2006 and 2007 any let-up should be slight. The liberalisation of the economy is the key to the boom. India has opened up more to the global economy especially since 1995. Import tariffs have been more than halved since 1990. However, they are still much higher than in other Asian states.

Furthermore, India has a broad base of highly qualified technicians and engineers. Each year some 200,000 engineering graduates leave Indian universities, about six times as many as in Germany.

In regions where economic catch-up is being played the demand for steel is of course particularly high. In India demand is being driven up by mammoth infrastructure projects, like the construction of dams, ports, power plants, railways and motorways. In addition, the key industrial sectors (such as construction, automotive and shipbuilding) are experiencing rapid growth. With salaries and wages rising, consumers are becoming more discerning with regard to their cars, household appliances and the like, which is also boosting steel demand.

Shashi Ruia, chairman, Essar Steel, notes that many companies from the developed world are looking at setting up manufacturing facilities in emerging economies that have natural resources, both in terms of raw material and energy. “Industry consolidation is gathering pace as companies devise new strategies to tackle fragmentation in the industry,” he points out. “Consolidation has become a major growth strategy. India is emerging as a major destination for new facilities in steel making, and global majors have already made progress for their plans for ‘Destination India.’ Essar has invested about $450 million in expansion and modernisation projects; it plans to expand capacity to 4.6 million tonnes per annum. Essar Steel has developed steel grades for high-end applications in the automobile and white goods sectors. It is also a leader in large scale infrastructure development sector in the construction segment

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THE GLOBAL STEEL INDUSTRY

The current global steel industry is in its best position in comparing to last decades. The price has been rising continuously. The demand expectations for steel products are rapidly growing for coming years. The shares of steel industries are also in a high pace.

The steel industry is enjoying its 6th consecutive years of growth in supply and demand. And there is many more merger and acquisitions which overall buoyed the industry and showed some good results. The subprime crisis has lead to the recession in economy of different countries, which may lead to have a negative effect on whole steel industry in coming years. However steel production and consumption will be supported by continuous economic growth.

CONTRIBUTION OF COUNTRIES TO GLOBAL STEELCONTRIBUTION OF COUNTRIES TO GLOBAL STEEL

INDUSTRYINDUSTRY

The countries like China, Japan, India and South Korea are in the top of the above in steel production in Asian countries. China accounts for one third of total production i.e. 419m ton, Japan accounts for 9% i.e. 118 m ton, India accounts for 53m ton and South Korea is accounted for 49m ton, which all totally becomes more than 50% of global production. Apart from this USA, BRAZIL, UK accounts for the major chunk of the whole growth.

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COUNTRY CRUDE STEEL PRODUCTION (mtpa)CHINA 272.5JAPAN 112.7UNITED STATES 98.9RUSSIA 65.6SOUTH KOREA 47.5F.R. GERMANY 46.4UKRAINE 38.7BRAZIL 32.9INDIA 32.6ITALY 28.4

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STEEL INDUSTRY IN INDIA

Today Steel finds application in every imaginable facet of our life. In the last ten years the global steel industry has been witnessing many interesting events that have influenced market dynamics.

The nineties were crucial for Indian steel industry. The ‘controlled’ environment has changed drastically, in the post-liberalization scenario. The sector was opened up to the entry of private players, while quantitative restrictions foreign trade has been removed. The last ten years has also seen inefficient steel mills with outdated technology perishing, while new capacities too have come up that possess latest technology expertise.

The Indian steel industry entered into a new development stage from 2005–06, resulting in India becoming the 5th largest producer of steel globally. Producing about 53 million tonnes (MT) of steel a year, today India accounts for a little over 7 per cent of the world's total production.

India is the only country world over to post a positive overall growth in crude steel production at 1.01 per cent for the January-March period of 2009. The recovery in steel production has been aided by the improved sales performance of steel companies.

India is also the fifth-largest consumer of steel in the world. It consumes about 1.5 MT of stainless steel a year with around 70 per cent accounting for kitchenware. However, its use in railway coaches, wagons, airports, hotels and retail stores is growing immensely. Demand for steel in India is likely to grow at around 12 per cent against the global average of 5–6 per cent. Steel consumption grew at 3.8 per cent in the January-March quarter of 2008-09 over the same period last year.

In 2000-01 the Potential demand for steel in India was 26.7 Kg MT but at present its has gone up to 49 Kg MT in 2008-09. This offers a huge potential to steel manufacturers, both domestic and global.

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Exports

Out of India’s annual iron ore production of more than 200 MT, about 50 per cent is exported.

Iron ore exports increased 17 per cent to 12.6 MT in February 2009 from 10.8 MT in the same month a year ago, owing to a moderate revival in demand from Chinese steel producers, as per the latest data compiled by a group of top Indian mining firms.

Earlier, according to a study, with the rise in demand for steel in China, India’s iron ore exports went up by 38 per cent to reach 13.6 MT in December 2008 against 9.8 MT in December 2007. Around 50-60 per cent of India’s iron ore is exported to China.

India’s exports during April-December 2008 were 64.4 MT. The government has reduced export duty on iron ore lumps from 15 per cent to 5 per cent, which has given a further fillip to exports. Further, the reduction in railway freight has also benefitted the domestic iron ore miners.

Investments

A host of steel companies have lined up major investment proposals. Furthermore, with an expanding consumer market, the Indian steel industry is likely to receive huge domestic and foreign investments.

* According to the Investment Commission of India investments of over US$ 30 billion in steel are in the pipeline over the next 5 years.

* Japan's Sumitomo Metal Industries is planning to build a blast furnace steel plant in India with mid-tier producer Bhushan Steel, investing as much as US$ 3 billion.

* Arcelor-Mittal, the largest steel maker of the world, is planning to set up a captive port near Paradip in Orissa. The port will be used to serve two mega integrated steel plants of the company proposed in Orissa and Jharkhand.

* On June 22, 2005, the much-awaited and long-delayed MoU for the largest steel project in India was signed between the South Korean steel major, Pohang Iron and Steel Company (Posco), and the Orissa government.

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* Tata Steel and Vale, a Brazilian Company along with other joint venture partners have announced to undertake a large scale expansion of the Carborough Downs Coal Mine near Moranbah in Central Queensland in Australia. The total capital investment is estimated to be a$401 million. The commencement of construction is scheduled for May 2008 and commissioning of the large scale and new mining equipment (Long wall) which will be one of the largest in Australia is expected by mid 2009.

* Essar Steel plans to pump in Rs 1,000 crore in a span of three years for setting up service centre across India, North America and the Middle East, to cater to specific steel requirement of auto, white goods and SME sectors. The 2.5 LTPA centre set up by the company at a cost of Rs 75 crore will make steel as per specifications asked for by its customers in North India. It will also enable it provide small lots and customized deliveries for ready-to-use steel.

In all, the steel major intends to set up about 15-20 such centre with a cumulative capacity of 4.2 million tonnes per annum as against the present 2.5 MTPA

The board of the Steel Authority of India Ltd (SAIL) is set to clear Rs 7,000-crore investment during the current fiscal for modernisation and expansion of Bokaro Steel Plant, according to Bokaro Steel managing director and member of the SAIL board UP Singh

Government Initiative & Impact

Subsequent to the recent fall in international prices of commodities and to protect Indian producers, the Indian government has announced some changes in customs duty rates, which were effective from November 2008.

The government has removed full exemption of customs duty on some industrial and agricultural commodities. Iron and steel products like pig iron, spiegeleisen, semi-finished products, flat products and long products are now subject to a basic custom duty of 5 per cent ad valorem.

The Indian government plans to invest over US$ 350 billion in industries related to infrastructure and construction which will give a fillip to the steel sector.

IMPACT: The impact of govt. Initiatives on steel sector is the upliftment of Rural sector in the usage of steel.

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SOME NEWS IN STEEL SECTOR

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ORGANIZATION PROFILE

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Essar Global Limited is a diversified business corporation with a balanced portfolio of assets in the manufacturing and services sectors of Steel, Energy, Power, Communications, Shipping Ports & Logistics, and Construction. Essar Global has offices in Asia, Africa, Europe and the Americas.

With a firm foothold in India, Essar Global has been focusing on global expansion with projects/investments in Canada, USA, Africa, the Middle East, the Caribbean and South East Asia. Privately owned and professionally managed, Essar is judiciously invested in the commodity, annuity and services businesses. Forward and backward integration, state-of-the-art technologies, in-house research and innovation have made Essar Global a leading player in each of its businesses. Essar’s abiding philosophy is to be a low cost, high quality, technology driven group with innovative customer offerings.

EGL has an excellent track record, having succeeded in the capital intensive and competitive manufacturing sectors. Better focus for each business through integration, incorporation of state of- the-art technology and innovative in-house research has made Essar Global a leading player in each of its businesses.

HISTORYHISTORY

The Essar group was founded over three decades ago by the Ruia family and is headed by Chairman Shashi Ruia and Vice-Chairman Ravi Ruia. The Ruia family has been in business and trading since the 1800s, when the family first moved to Mumbai from Rajasthan in Western India. In 1956, Nand Kishore Ruia, the group founder, moved south to Chennai to begin independent business activities. In 1969, following the untimely demise of Nand Kishore Ruia, his sons Shashi and Ravi Ruia took over the group. Along with a team of seasoned professionals, the Ruias have built the perfect platform for Essar's accelerating growth. With a strong foundation at India’s industrial core and in the sunrise services sector, Essar has stayed firmly in the forefront of new opportunities. An early start has made us a key player in India's exploding telecom market. Similarly, we set up India’s first independent power plant and its first new generation private steel plant.

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MISSION

To create enduring value for customers and stakeholders in core manufacturing and service businesses, through world-class operating standards, state-of-the-art technology and the 'positive attitude' of our people.

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MANAGEMENT TEAMMANAGEMENT TEAM

ESSAR GROUP

Shri. Shashi Ruia Chairman

Shri. Ravi Ruia Vice Chairman

Shri. Prashant Ruia Director

Shri. Anshuman Ruia Director

Ms. Smiti Ruia Director

Shri. Rewant Ruia Director

Corporate Functions

Mr. S. V. Venkatesan Resident Director - Chennai

Mr. J. Mehra Resident Director - New Delhi

Mr. Jayesh Buch Resident Director - Ahmedabad

Mr. Madhu S. Vuppuluri Resident Director - New York

Mr. Suresh Sundaram Director - Corporate Aviation

Mr. Adil Malia President - Human Resources

Mr. Sunil Bajaj President - Corporate Affairs

Mr. Mukesh Bhavnani President - Legal

Mr. Vijay Mehra Chief Information Officer

Mr. Manish Kedia Head - Corporate Communications

Mr. N. S. Paramasivam Head - Forex & Treasury

Mr. Dinyar M. Jivaasha Head - Corp. Risk & Ins. Mgmt.

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ESSAR STEEL LIMITEDESSAR STEEL LIMITED

Essar Steel Limited’s complex at Hazira in Gujarat, India, houses the world’s largest gas-based single location sponge iron plant, with a capacity of 5.5 MTPA. The fully integrated Steel complex focuses on the requirement of “FLAT STEEL” for construction sector ( Infrastructure companies, construction equipment manufacturers, Pre-Engineered Buildings/ Structures, Power/ Power transmission companies, Wind mill companies, Project goods etc.)

The complex also houses the steel plant and the 1.4 MTPA cold rolling complex. The steel complex has a complete infrastructure setup, including a captive port, lime plant, and oxygen plant.

Essar has a fully integrated steel plant from iron-ore to ready-to-market products. It has a port based steel complex that houses the world largest Hot Briquetted Iron (HBI) plant of 5.1 MTPA capacity that feeds a state of art mill has a capacity of 4.6 MTPA.

The complex houses

1.3 MTPA HRPO ( Hot Rolled Picked and Oiled ) facility 0.7 MTPA Cold Rolling 0.5 MTPA Galvanizing lines for catering to value based customers.

The state of art service centre includes India’s only Hot Skin Pass mill of 1.2 MTPA capacities with shearing and slitting lines capable of handling capacity of 0.6 MTPA and 0.4 MTPA respectively.

Steel produced at Essar is a highly customised value-added products catering to a variety of product segments, and is India’s largest exporter of flat products, selling close to half of its production to the highly demanding US and European markets, and to the growing markets of South East Asia and the Middle East.

Essar was the first steel integrated steel plant in the country to obtain the prestigious ISO 9001 for all the operations. The company’s products conform to quality specifications of International Quality certification agencies like ABS, API, TUV Rhine Land and Lloyd’s Register. Essar Steel is the first Indian steel company to receive an

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ISO 14001 Certification for environment management practices. Some other approvals and certifications of the company are as follows:

Grades Approving Agencies

IRSM 41/97 (HR/CR) RDSO

IS 2062 Fe 410 WA, WB & WC & IS 8500 Fe 570 Gr. B ( With and without copper)

RDSO

IS 2002 Gr. 2 and IS 10748 Gr.2 IBR

EN 10025 S 235, 275, 355

( For Export to European market )

RTUV

1E 0650 and 1E 0170 Caterpillar , USA (Plates for manufacturing earth moving equipment

IS 2062 Gr. A, B & C and IS 8500 NTPC, PGCIL

Essar Steel is among the 25 percentile of lowest cost producers world-wide and has acquired extensive quality accreditations. The rapidly growing infrastructure and construction sector is our prime focus area.

Every single product that rolls out of the plant at Essar guarantees that it has been produced in concurrence with the highest standards of manufacturing process, state-of-the-art technology and precision.

The special characteristics of our products are:

Control of steel chemistry in a narrow band and minimum level of centre line segregation in steel.

Consistency of mechanical properties and good weld ability.

Clean steel with minimum inclusion level.

High toughness at sub-zero temperature.

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SEAMLESS INTEGRATION

A major strategic advantage is Essar’s high level of forward and backward integration. The company are totally integrated - from raw material to finished products, adding value at every stage of the manufacturing process.

Bailadilla Ore Beneficiation Plant

At Bailadilla, where some of the world's richest and finest ore is available, Essar has set

up a beneficiation plant of 8 million tonnes per annum (MTPA) capacity, which ensures the highest quality iron ore. The iron ore slurry is pumped through a 267 km. pipeline the second longest in the world) to the pellet plant, yielding advantages of quality, cost and real time inventory management.

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Visakhapatnam Pelletization Plant

The slurry is received at our Pellet plant at Visakhapatnam, which has a capacity of 8 MTPA, providing vital raw material for the steel plant at Hazira

Hazira Steel ComplexEssar steel complex at Hazira, Gujarat, houses a 5.0 MTPA sponge iron plant, the

world's largest gas-based HBI producer. The plant provides raw materials for our state-of-the-art 3.0 MTPA hot rolled coil (HRC) plant, the first and largest of India's new generation steel mills. This plant, fed with inputs from three electric arc furnaces and three casters, increasing its capacity to 4.6 MTPA.

The complex's sophisticated infrastructure includes independent water supply and power, oxygen and lime plants, a township and a captive port capable of handling up to 8 MTPA of cargo with modern handling equipment like barges and floating cranes.

Steel Plant (Overseas)

Essar Indonesia

Algoma Steel, Canada

Minnesota Steel, USA

Essar Vietnam

Essar Steel Carribean Ltd.

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PROCESS FLOW AT HAZIRA COMPLEX

STRATEGIC LOCATION

From its location on the West Coast, about 260-kms north of Mumbai, Essar Steel has a major advantage with respect to the inward movement of raw materials and the outbound movement of finished goods.

The captive port - capable of handling 6 MTPA of cargo annually - is loaded with facilities like sea-going floating cranes, articulated barges and other marine equipment.

THE TECHNOLOGICAL ADVANTAGE

Essar Steel employs the world's most advanced technology from the best equipment suppliers. Its many firsts include an indigenous Hot DRI charging system, the largest DC electric-powered steel plant and India's first Continuous Tandem Cold Mill (CTCM). Level II automation aided by one of the largest ERP installations in India by SAP and an Integrated Marketing and Production System (IMPS) from DEC of USA make Essar Steel completely future-ready.

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ANSWERING THE WORLD’S NEED FOR STEEL

With technology that surpasses global benchmarks, Essar Steel produces grades that many Indian steel mills can only aspire to. The market leader in many niche segments in the domestic market, Essar Steel is one of the leading suppliers for pipelines, automobile manufacturers, construction and other sophisticated industries, as it provides a competitively priced, yet superior quality, alternative to high-grade imports.

In the international market, Essar Steel is positioned alongside prime European and Japanese steel producers. Little surprise then, that Essar Steel is the largest exporter of flat products from India. Moreover, Essar Steel is a leading supplier of API grade steel in the world for pipelines in the oil & gas sector, having helped create pipelines that stretch 8500kms across 5 continents.

QUALITY THAT WORLD APPROVES

What makes Essar Steel the world's preferred steel maker is the wide product range that is completely customisable to unique customer needs along with flexible delivery options.

Essar Steel's strong standing in domestic and international markets is also due to its lofty quality standards. Ever the leader, Essar Steel was the first integrated steel plant in the country to obtain the prestigious ISO 9001 for all operations. In addition, it was the first Indian steel plant to achieve the ISO 14001 accreditation for Environmental Management System.

Obviously, quality-driven processes would only create products that surpass international quality standards as well. Certifications for its products include Lloyds Register (UK) for exports, IRS (Indian Registrar of Shipping), DNV, ABS, TUV, BIS (Bureau of Indian Standards), OITC and IBR (Indian Boiler Regulation Act).

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THE 24 CARAT EDGE

To develop a unique identity and differentiate its products, Essar Steel launched 24-Carat Steel, the first branded steel of its kind in India. 24 Carat Steel defines the core properties of Essar Steel as well as the total offering from the company in terms of product quality, standards, delivery systems and customer service. 24 Carat Steel today finds application in diverse specialised and demanding industries - from general engineering to automotive and shipbuilding.

Superior production processes, world-class technology and a committed workforce has helped Essar Steel develop value-added steel and placed the company in the league of a select few world class steel manufacturers - thus casting the 24 Carat promise in concrete.

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THE RETAIL THRUST

Essar Steel Hyper mart’s is a pioneering effort in retailing of steel products and has connected successfully with small and medium customers. Essar Steel Hypermart is India’s largest chain of retail stores for steel products. Essar Steel Hypermart has a pan India presence with 65 hyper marts and 15 Express marts.

Essar have a strong workforce of over 230 employees—across the country—who are committed to meeting the requirements of small manufacturers, local fabricators and engineering and construction companies who today buy steel from local intermediaries.All Essar Steel hyper marts store various types of steel products. After selecting your material at any retail outlet, you need to make advance payments of that product in that outlet. After your payment is cleared, you can take delivery of your materials.

At Essar Steel hyper mart you can choose from a comprehensive range of flat steel products for variety of applications.

The five Value propositions of Essar Steel hyper mart are:

1. Trust of Essar Quality

2. Immediate Delivery

3. Transparent Pricing

3. Easy Contact ability

5. Pan-India presence

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PRODUCTSPRODUCTS

HOT ROLLED PRODUCTS

Essar Steel produces the finest quality of 24 carat Hot Rolled steel in India. Since its introduction, Essar Hot Rolled steel continues to be a critical input for highly demanding applications. Essar Hot Rolled Products are available in plates, sheets and coil form.

Application

General Engineering, Automobiles, Infrastructure, Oil and Gas pipelines, Line Pipesetc.

Specification and Dimensions

Thickness: 1.6mm – 20mmWidth: 1250mm – 2000mmLength: 2500mm – 8000mm

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GALVANIZED COILS AND SHEETS

Essar Steel’s 24 carat Galvanised Steel with a guaranteed zinc coating of 120 gsm offers best resistance to corrosion. To suit a variety of applications, they are available in 3 different surface finishes.

Application

Air-conditioning and heating ducts, automotive under-body parts and muffers, water heaters and stoves, coolers and refrigerators

Specification and Dimensions

Thickness: 0.25mm – 1mmWidth: 900mm – 1220mmLength: 2500mm

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COLD ROLLED PRODUCTS

Essar Steel’s 24 carat Cold Rolled steel is a combination of high strength ductility, consistent mechanical properties, close dimensional tolerance and superior surface finish.

Application

Automotive body and components, white goods, pipes and tubes, drums and barrels.

Specification and Dimensions

Thickness: 0.4mm – 2.5mmWidth: 900mm – 1500mmLength: 2500mm

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CHEQUERED PLATES

Essar 24 carat steel Chequered Plates are high friction plates ensuring maximum skid resistance. These plates ensuring maximum skid resistance. These plates are available in tear drop pattern with a maximum height of 1.2 mm.

Application

Multiple use in flooring, Grating over close gutter / culvert and Structural functions.

Specification & Dimensions

Thickness: 3mm – 8mmWidth: 1250 mmLength: 5000 mm

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SONA GC CORRUGATED SHEETS

Essar SONA GC Sheets with a guaranteed zinc coating of 120 gsm offer longer life andbetter durability. The extra wide 1200mm sheet is another breakthrough solution that results in big savings for customers.

Application

Roofing for low-rise structures, rolling shutters and sheds

Specification and Dimensions

Thickness: 0.25mm – 0.6mmWidth: 760mm – 1200mmLength: 2440mm – 4270mm

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COMPETITORS

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COMPETITOR MAPPING

BHUSHAN STEEL LTD

BSL (Formerly BSSL) is spearheading a technological revolution in India’s Cold Rolled Steel industry and, in the spirit of a true leader, is ceaselessly striving to raise the bar, achieve new milestones and set new benchmarks in terms of quality of products and degrees of customer satisfaction.

The most brilliant milestone in BSL’s journey of excellence is the setting up of a state-of-the-art Steel & Power plant in Orissa. On completion, the plant will be one of the largest integrated HR steel and Power complexes of the nation.

BSL’s Galvanised Sheets, Color Coated Sheets, Coils, Corrugated Sheets and Galume (Zinc and Aluminium coated) Sheets/Coils are being accepted and appreciated across the world...

Bhushan Steel is the third largest producer of secondary steel after tata steel and sail. The total capacity of Bhushan is 3 million tonne steel in Orissa.

COLD ROLLED STEEL COILS

     

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S.no Parameters Technical details/specifications

1. Thickness(nun) 0.10t04.00

2. Width(mm) 10to 1700(Max)

3. Coil Weight(MT) Up to 30 MT (7 to 18 kg/mm width)

4. Surface Finish Super Bright, Bright, Dull&Matte. (RaValuewith controlled Rmax on request).

5. Grades Specifications - As per JIS/BIS/ ASTM/EN Standards

Low Carbon CRCA GradesSuper EDD/EDD/DD/D (SPCX, SPCEN, SPCD, SPCC) non-aging, IF-HighStrength steel(IF-HSS), High Strength Low Alloy Steel (HSLA), viz., ST -42,ST-45, ST-52, SAPH-400/41O, Steel for Porcelein Enammeling, CorrosionResistant Steel, viz., Tin Mill Black Plate (TMBP)

Medium &High Carbon CRCA GradesC- 30, C-40,MC -ll,EN - 8, for spring steel application, C-55, MC-12,EN- 9 C-62,C-60, C-80,HC-14,EN-42J

6. Strip widths mm ELECTRICAL Grades Elec -I, Elec-n, Elec-nI, SemiProcessed Elect. Steel

7. Chemical composition (Coating)

OTHER CRCA GradesCase Hardening Steel- 15Cr3, SAE 1010, SAE 1012Through Hardening Grades- SAE 1040,SAE 1045, 1055, 1065, 1080, 1541

H.R PICKLED/ SKIN PASSED & OILED 8. Thickness Up to 3.00 mm           3.00 mm - 4.00 mm           Above 4.00 mm

9. Max. Width for Cut Size 1500 mm                   1250 mm                          600 mm  

10. Width for Coil 50 mm - 1700 mm      50 mm - 1700 mm             50 mm - 1700 mm

 COLD ROLLED STEEL SHEETS

 

     

S. no

Parameters Technical details/specifications

1. Thickness(nun) 0.10t04.00

2. Width(mm) 10to 1700(Max)

3. Cut- to -Length (mm) Up to4500mm with tolerance of +2/-0 mm(Further close tolerance onrequest)

4. Coil Weight(MT) Up to 30 MT (7 to 18 kg/mm width)

5. Surface Finish Super Bright, Bright, Dull&Matte. (RaValuewith controlled Rmax on request).

6. Grades Specifications - As per JIS/BIS/ ASTM/EN Standards

Low Carbon CRCA GradesSuper EDD/EDD/DD/D (SPCX, SPCEN, SPCD, SPCC) non-aging, IF-HighStrength steel(IF-HSS), High Strength Low Alloy Steel (HSLA), viz., ST -42,ST-45, ST-52, SAPH-400/41O, Steel for Porcelein Enammeling, CorrosionResistant Steel, viz., Tin Mill Black Plate (TMBP)

Medium &High Carbon CRCA GradesC- 30, C-40,MC -ll,EN - 8, for spring steel application, C-55, MC-12,EN- 9 C-62,C-60, C-80,HC-14,EN-42J

7. Strip widths mm ELECTRICAL Grades Elec -I, Elec-n, Elec-nI, SemiProcessed Elect. Steel

8. Chemical composition (Coating)

OTHER CRCA GradesCase Hardening Steel- 15Cr3, SAE 1010, SAE 1012Through Hardening Grades- SAE 1040,SAE 1045, 1055, 1065, 1080, 1541

  H.R PICKLED/ SKIN PASSED & OILED 9. Thickness Up to 3.00 mm           3.00 mm - 4.00 mm           Above 4.00 mm

10. Max. Width for Cut Size 1500 mm                   1250 mm                          600 mm  

11. Width for Coil 50 mm - 1700 mm      50 mm - 1700 mm             50 mm - 1700 mm

 

SWOT ANALYSIS FOR BHUSHAN

The SWOT analysis of Bhushan Steel Ltd is as follows:

STRENGTH:

1. Commitment- Bhushan Steel has always tried to offer the best price and quality to its customers. To achieve this they have strategic alliances with Sumitomo Metal Industries, one of the world’s largest producer of steel.

2. Availability- The availability of material on time is the major strength of Bhushan Steel. To improve on it more they are planning to implement the backward integration process of manufacturing.

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3. Quality- The Quality of Bhushan Steel is according to the international and Indian standards.

WEAKNESS:

1. Decision Process: Lengthy procedures are followed in decision making.

2. Niche Market: Bhushan Steel caters to the niche market and high value added premium steel products- auto grade and white goods. Due to this they have limited their markets to smaller segments.

OPPORUNITIES:

1. Integration Process: The company has an opportunity in setting up an backward integration process which will help in achieving the more necessary controls over availability and pricing of the material.

2. More Access to International Markets: with the implementation of backward integration, the company will have an access to the international markets. They can have more access to various potential markets with low price and high availability.

3. Research and Development: Research and development of new value added premium products like “Gaulme” with a high corrosion resistant coat.

THREATS

1. Upcoming International Players: there always one threat lies from big international players like Arcelor Mittal. They have a huge capacities of manufacturing and finance availability.

2. Fluctuating Metal Prices: Bhushan steel mainly go for long term contracts with institutional buyers. Typically they place orders on a quarterly basis. In such long term contracts there is always threat lies of fluctuating prices in national and international markets.

3. Intense competition from various players: there are various players like Essar, Tata, Ispat which pose a great competition in the white goods market supply. Moreover, due to this the market prices and equilibrium gets disturbed which affects the overall pricing of the product.

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ISPAT LTD

Applications

Ispat Industries Limited’s cold rolled coils are manufactured at the highly advanced cold rolling mill at Kalmeshwar, and can be used in a wide variety of applications as follows:

» In industrial goods such as automobile components, precision tubes and consumer durables.

» In the manufacture of bodies of vehicles as varied as automobiles and railway coaches.

» For the production of heavy machinery like earthmoving and material-handling equipment.

» Specially suited for panel applications in refrigerator bodies and washing machines.

» In bicycle parts, office equipment and furniture.

» For basic items such as galvanized sheets, tin plates, drums and barrels.

Unique features of Ispat's CR coils

Ispat ensures that the material is free from defects, which are harmful to the intended use of the product. The degree or amount of surface defects in a coil may be expected to be more as compared to cut sheets because of the impossibility of rejecting the defective portion of the coil. However, Ispat restricts the amount of such defects to a maximum of 5 per cent.

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Galvanized Sheets

Ispat Industries Limited was the first Indian company to set up a Continuous Galvanizing Line for thin gauge sheets in 1985. In fact, the company pioneered the manufacture of thin, medium and thick gauge galvanized steel sheets in the country. With two Galvanizing Lines at its plant at Kalmeshwar, it manufactures coils and GP/GC sheets that meet the needs of the most demanding customers

Product Range

Ispat galvanized sheets come in a range of specifications, i.e., plain, corrugated, profiled and in coils. The thickness ranges from 0.15 mm to 1.60 mm and is suitable for varied applications. Sheets are normally produced in widths of 900 mm, 1000 mm and 1220 mm and in lengths as required by the customer.

Galvanized Plain sheets can be supplied in coils weighing up to 10 metric tonnes. They are tough and sturdy, bright and gleaming, corrosion-proof and crack-free upon corrugation or fabrication. Continuous annealing at the Galvanizing Line renders a level of hardness that can be varied to suit customer needs and also makes the product ideally suited for a range of uses.

Computer controlled processes ensure perfect zinc coating on the strips which helps in effective prevention of rust and also lengthens the product life. The sheets are made in different surface finishes, such as bright, dull or matt as per customer requirements. Spangles can be regular or minimum as required. Ispat’s hot-dip galvanized sheets can be subjected to bending and forming without the flaking of zinc. They can be easily welded and painted for added protection. Moreover, to suit specific requirements, these sheets can also be of drawing quality such as D/DD/EDD/Lock Forming nature.

Corrugation

Ispat's high performance sophisticated corrugation machines with adjustable profile arrangements are designed to serve specific needs of varied applications as per customers' requirements.

Specifications

Ispat’s galvanized products generally conform to Indian Standard IS277/92 and Japanese Industrial Standard G3302. Any other standard specified by the customer can also be met with precision and accuracy.

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Quality assurance

The plant is accredited with QS-9000 and ISO-14000, which together with Ispat's holistic quality approach through TQM/TPM ensures quality assurance right from selection of raw material, the throughput processes, the rigorous testing and inspection procedures, ending with carefully and well managed logistic process.

Colour Coated Sheets

Ispat manufactures an innovative and exciting product, namely colour coated sheets called Polysteel, in a variety of shades and designs, such as dark or pastel, printed or plain and striped or embossed. These Polysteel sheets are painted after galvanizing and apart from creating a stunning visual impact, bring numerous advantages to end user industries. Polysteel building sheets, for instance, make it possible to design and construct your choice of beautiful structures, save on structural steel and maintenance, and obtain overall cost effectiveness.

Introduced by Ispat Industries Limited (IIL) in 1990, Polysteel is a premium cold rolled steel sheet coated with zinc in a continuous Hot-Dip Galvanizing Line and subsequently given multiple layers of organic coatings in a continuous Coil Coating Line with a Reverse Roller Coating Process. Polysteel conforms to IS: 14246:95 and other equivalent international standards and thus, the buyer are assured of the best quality product.

Polysteel is durable, cost-effective and easy to install and use. Hence, it proves to be a versatile product for various applications. It is virtually a ready-to-use product that can be cut, bent, pressed, drilled, roll formed, lock-seamed and joined, all without damaging the surface or the substrate.

This product is available in various forms, namely roll formed panels, trapezoidal profiles, corrugated sheets, plain sheets, coils and narrow slit strips. Moreover, it is available in a variety of grades, colours and forms to meet specific customer requirements.

Product Features

» A High tensile steel now available till 550 Mpa UTS.

» Special formulations used for chemical pre-treatment and coatings ensure a long life and exterior durability.

» A precision finish that is uniform in colour, gloss, texture and film thickness.

» Superior designs and surface finish otherwise not obtainable.

» Flexibility of gauge, width, grade and surface finish.

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SWOT OF ISPAT

STRENGTH

1. First Mover Advantage: Ispat was the first company to establish the continuous Galvanization line for thin gauge sheets.

2. Quality Standards: Ispat steel produces quality material which meets the Indian as well as the international standards.

3. Rural Management: Ispat is well known for Corporate Social Responsibility. It provides free drinking water to 44 villages through which is building its brand image especially in rural area.

4. Supply Chain Management: Ispat is well known for managing its supply chain system. They have well established and well connected network to various parts of the country to cater according to the needs of the customer.

WEAKNESS

1. Long procedures for decision making: They have long procedures to follow for the procurement of material.

OPPORTUNITIES

1. International Markets: There is lot of scope in the international markets as there is huge demand in the international markets in white goods products.

2. Product Development: in order to tap more market share, the company is continuously doing the product development. They have many products lined up to come in near future which will help the company to take first mover advantage.

3. Integrated Steel Plant: Ispat has an integrated facility of manufacturing steel which gives it a cost and mover advantage against its competitors.

THREATS

1. Threat from China: the major threat to Indian Steel industry can be from the import of steel from China. China is lifting the export tax on steel which will reduce the prices of steel and may give serious competition to Indian steel industry.

2. New Entrants: there is always a threat lies from the new entrants in the market which may disturb the equilibrium of the market. Big and Cost effective players like Arcelor Mittal, some Chinese players may enter in the Indian steel market and can disturb the equilibrium of the steel market.

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TATA RYERSON LTD

Tata Ryerson Ltd was the first company in India who floated the novel idea for the first steel service centre in organized sector in India. Tata Ryerson Ltd is a 50:50 joint venture between Indian well known Tata Steel Ltd and erstwhile Ryerson, USA.

Tata Ryerson Ltd has 6 large processing units, 16 sales locations and a host of partners like external processing agencies, suppliers, retailers and other stakeholders. It is the probably nation’s largest steel service organization. The past 10 years has bought many astounding changes in the Indian growth scenario and Tata Ryerson Ltd maintained its strong growth path with commitment to quality processing, innovations and exceptional customer focus. Keeping in view the rapid expansion, consolidation, technology change and a great number of steel consumers Tata Ryerson went into series of timely expansions and ventured successfully into new business areas Rebar Processing, Stainless Steel (TRYNOX the only brand of TRyl) and recent plate fabrications operations. The journey that started in 1997 with a small unit at Bara, Jamshedpur and a meagre turnover of Rs 1.8 Crores in 1997-1998 and continuously soaring high with a mind boggling figure of Rs. 1225 Crores in just 11 years with a volume of over 1.3 million tonnes, speaks volumes about the strategic directions and stable vision of the company.

Tata Ryerson has processing plants at Jamshedpur, Faridabad and Pune and is coming up with new expansion plans in Pantnagar and Singur to support major OEM’s with facilities like Roll Forming , Stretch bending, Plate fabrication. All the plants of Tata Ryerson are equipped with modern software systems like SAP, ERP packages. During the current year it is augmenting its processing capacity base by 0.5 million tonnes. It is also planning to invest over 100 crores over the period of next two years to support its growth path.

FLAT PRODUCT PROCESSING

Tata Ryerson commenced its operations with its Flat Products Processing business. The company has gained its proficiencies in HR processing, CR processing, GP and GC processing. Tata’s latest venture has been in the Stainless Steel branded as TRYNOX. Various processes such as Plate Burning, Roll Forming and stretch bending initiatives have been started at Singur.

Tata Ryerson adheres strictly to quality standards that have resulted in servicing successfully its top OEM for 10 years.

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TRYNOX (AN INITIATIVE IN STAINLESS STEEL)

Tata Ryerson is not only India’s largest, but one of the world’s leading steel service centres. Tata Ryerson has its presence in sixteen locations across the country reaching nearly one thousand customers nationwide.

Now to excel its growth path Tata Ryerson is offering customised solutions for the stainless steel flat rolled requirements. It maintains a ready stocks of variety grades, sizes and finishes. Its state-of-the-art processing lines in Pune are capable of converting HR coils and CR stainless steel coils and sheets to the desired requirement for custom sheets, blanks or slit coils, vinyl applications.

PROCESSING LINES

The Ranjagaon Coil Processing Centre with modern facilities covering 21 acres near Pune is fully equipped to process HR and CR Stainless Steel Coils, Sheet and Plate gauge products.

HR processing facilities include a wide slitting and both wide and medium width cut-to-length lines plus multiple close tolerance shearing machines.

CR processing encompasses a full range of equipment, namely a wide slitting line and both wide and narrow width cut-to-length lines with levelers for sheeting and blanking input coils.

The application of Stainless Steel or Fabricator in any of the following business segments are as follows:

1. Consumer Durables/Appliance Manufacturing 2. Pressure Vessels

3. Automotive, Railways & Transport ART

4. Machinery & Equipment

5. Architectural, Building & Construction (ABC)

6. General Metal Fabrication, or

7. Other Commercial and Industrial Sectors

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Typical Grades Standard Finishes Shapes & Packaging

304 * No.1 HRAP * Coils

304L * 2D * Slit Coils

316 * 2B * Sheets

316L * No.3 polished * Blanks

409L * No.4 polished * Bare, paper interleaved or vinyl adhesive laminated.

430* BA (Bright

Annealed)* with standard or customised pallets and packaging protection

Other grades

available upon

request

   

SWOT ANALYSIS OF TATA RYERSON

STRENGTH:

Tata Ryerson being a JV has much strength which keeps them ahead from various competitors. Some of the strengths are as follows:

1. AVAILABLE INVENTORY: Tata Ryerson is a complete one-stop shop for the outsourcing needs. Their inventory includes a full range of grades, shapes and sizes of flat-rolled HR and CR stainless steel.

2. ON TIME DELIVERY: They constantly strive to achieve the goal of 100% on-time delivery performance and can provide quick turn-around on emergency requirements.

3. QUALITY PRODUCTS: The precision processing equipment and advanced quality systems ensure close tolerances to meet the exact specifications.

4. RAPID RESPONSE: The trained representatives can understand the processing needs, respond promptly to customer enquiries, and give each order the desired attention it deserves.

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WEAKNESS:

1. High Price Material: Being Quality focussed organization the Tata material is quite high priced in the steel market. Customers, who require low quantity of materials or price conscious, prefer to go for other materials like of Bhushan, Essar.

2. Dimensions: The dimensions of steel provided by Tata are quite small and sometimes do not able to cater the requirements of the customer.

OPPORTUNITY:

1. Increase Market Share: Since Tata has a JV with largest steel producer Ryerson, so they have very huge market potential. Ryerson being a largest supplier of steel can prove to be a major strength in catering the largest customer base in India.

THREATS:

1. Other Giant Players: Players like Arcelor Mittal can pose a serious threat to the market in overseas. They have huge capacity which is the major strength and can capture the nation market too.

2. Imported Steel: Steel imported from China and other nations may also pose a threat to Tata’s Indian market as they are imported on a very low price. This can disturb the equilibrium of the market and can change the preference level of consumer.

3. Fluctuating International Market Prices: With the rapid changes in the World Steel Prices, the price in the national market gets disturbed. The change in dollar versus Rupee affects the market equilibrium and finally the demand and supply in the market.

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IRON AND STEEL MAKING PROCESS- DIFFERENT ROUTES

THE BASIC OXYGEN CONVERTOR

The BOS (Basic Oxygen Steelmaking) process is the major modern process for making bulk steels.

PROCESS:

The Basic Oxygen Steel making vessel is first tilted to allow materials to be tipped into it (charged). The Scrap steel is first charged into the vessel followed by hot metal liquid (liquid iron) from the blast furnace. A water cooled lance is lowered into the vessel through which very oxygen is blown at a high pressure. The oxygen through a process known as oxidation combines with carbon and with other unwanted elements, separating them from the metal, leaving steel. Lime based fluxes (materials that help the chemical process are charged) and they combine with “the impurities” to form Slag. The main gas which is formed as a by product is Carbon Monoxide.

The Modern BOS vessel makes up to 350 tonnes of Steel at a time and the whole process takes about 40 minutes.

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ELECTRIC ARC METHOD OF PRODUCING STEEL

Unlike BOS, the EAF does not use hot metals.

PROCESS

In this process the material is charged with the “cold” material. This is normally a steel scrap (recycled goods made from steel which have been reached at the end of their life). These include Direct Reduced Iron (DRI) and Iron carbide, as well as pig Iron which are Iron from a blast furnace which has been cast and allowed to go cold.

Steel scrap is first tipped into the EAF from an overhead crane. A lid is then swung into the position over the furnace. A lid contains electrodes which are lowered into the furnace. An electric current is passed through the electrodes to form an arc. The heat generated by this arc melts the scrap. The electricity needed for this process is enough to power a town with the population of 100,000.

During the melting process, other metals (Ferro alloys) are added to the steel to give it the required chemical composition. The modern electric arc furnace typically makes 150 tonnes in each melt, which takes around 90 minutes.

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DOWN STREAM PRODUCTS LIKE CRCA / GP/ COLOR COATED STEEL

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MANUFACTURING OF CRCA STEEL

COLD ROLLED - CLOSE ANNEALED (CRCA) SHEETS & COILS

PROCESS

STEP 1:

For producing Cold Rolled coils or sheets, Hot Rolled coils are used as a raw material for it. The Hot Rolled coils are taken into Pickling Plant where scale is removed from iron and steel usually by means of immersion in a hot hydrochloric or sulphuric acid bath. Wastes include spent pickling liquor, sludge and rinse water.

STEP 8:

Now the sheets formed from shearing line are levelled through Levelling line for producing the final Cold Rolled Sheets.

GALVANIZATION PROCESS

Hot-dip galvanizing is a form of galvanization. It is the process of coating iron or steel with a thin zinc layer, by passing the steel through a molten bath of zinc at a temperature of around 860 °F (460 °C). When exposed to the atmosphere, pure zinc reacts with oxygen to form zinc oxide, which further reacts with carbon dioxide to form zinc carbonate, a dull grey, fairly strong material that stops further corrosion in many circumstances, protecting the steel below from the elements.

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Galvanized steel is widely used in applications where rust resistance is needed, and can be identified by the crystallization patterning on the surface (often called a "spangle").

The process of hot-dip galvanizing results in a metallurgical bond between zinc and steel with a series of distinct iron-zinc alloys. The resulting coated steel can be used in much the same way as uncoated. Galvanized steel can be welded; however, one must exercise caution around the resulting zinc fumes. Galvanized steel is suitable for high-temperature applications of up to 392 °F (200 °C). Use at temperatures above this level will result in peeling of the zinc at the intermetallic layer. Galvanized sheet steel is commonly used in automotive manufacture to enhance corrosion performance of exterior body panels of some models.

Steel strip can be hot-dip galvanized in a continuous line. Hot-dip galvanized steel strip (also sometimes loosely referred to as galvanized iron) is extensively used for applications requiring the strength of steel and resistance to corrosion.

Applications include: roofing and walling, safety barriers, handrails, consumer appliances and automotive body parts. One common use is in metal pails. They are also used in most heating and cooling duct systems in buildings

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COLOR COATED STEEL

Manufacturing Process:

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Pre-painted steel sheet is made with cold-rolled galvanized steel sheet as substrate, through surface de-oiling, phosphating and chromating and further processed by coating and baking.

Heat treated up to 96 hrs. at 120o C to ensure luster resistance to fading& Impact, and also to ensure its free of peeling and other characteristics and the quality of the coating is much more uniformity, stable and better than painting or brush painting on the metal surface. Moreover, it can keep bright and rustiness for 15-20years. This is a rapidly developed new type pre-painted steel product and is widely used in the construction, household appliance, decoration and other industries. And we also have 36 colours available to choose.

Technical Specification:

Thickness: 0.2mm To 1.00mmWidth: 760mm To 1220mmMax Weight: 6000 Kg /CoilInner Diameter of steel Coil: 508mm

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APPLICATIONS

Construction industry (Outdoor): workshop agricultural ware houses housing prefabricated component corrugated roof, walls, rainwater pipes, balcony railings, news stall, booth and rolling door.

Construction industry (Indoor): doors 、door frames, housing light steel structure、 screens ceilings, elevators, stairs and ventilation stack.

Electrical industry: Electric refrigerators, washing machines, switchgear, instrument cabinets, air conditioners, microwave ovens, baking machine.

Furniture Industry: Radiator, lamp shades, wardrobe, desk, bed, suitcase, bookshelf

Transport industry: interior trim of automobile and train, clapboard, container, isolation lairage, clapboard of steamship

Others: tablet, dustbin, billboards, watches, typewriter, instrument panel、 photographic material

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Features:

Galvanization: Zinc or Al-Zn Uniform galvanization

Light mass but high strength.

Aesthetic appearance.

High resistance to corrosion / Rusting.

Extra Protection of organic coating on the galvanized layer for prolonged service life.

Wide range of coating options to suit stringent weather conditions.

Appropriate hardness

Wide product range

Glossy finish

Maintenance free.

Environmental friendly.

Safe & protected packing

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RESEARCH METHODOLOGY

Research Design

Research Tool

Selection of the Sample

Data Collection Method

Sampling Plan

Sampling Unit

Sample Size

Sample Procedure

Data Analysis

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RESEARCH METHODOLOGY

BACKGROUND OF THE STUDY

The ESSAR STEEL manufactures various kinds of steel which finds its applications in various industries like Automobiles, Consumer Durables, and Roofing etc. They have a well established market in Delhi and some parts of U.P. which mainly includes West U.P. They have some major customers like L.G., Whirlpool, and Maruti etc which has a large consumption requirement. But these companies mainly prefer for Color Coated Steel which caters their immediate requirement and reduction of cost and labour.

So, they are into establishing new manufacturing line called COLOR COATED line of steel. It has a huge market potential and also leads to the customization of product. In order to install new line of production they want to know the consumption pattern of Color Coated steel in comparison to steel which they generally use for manufacturing the product.

RESEARCH OBJECTIVE

TO FIND OUT THE CONSUMPTION PATTERN OF STEEL IN WHITE GOODS INDUSTRY

RESEARCH DESIGN

A research design is purely & simply the framework or plan for study that guides the collection and analysis of data. It is a blue print that is followed in completing a study. Descriptive is used to conduct this survey.

1. RESEARCH DESIGN: - A research design is purely & simply the framework or plan for a study that guides the collection and analysis of data. It is blueprint that the followed in completing a study exploratory research is used to conduct this survey.

2. RESEARCH TOOL: - In Depth interviews were conducted with the customers and competitors in order to understand the consumption pattern of steel in company.

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SELECTION OF THE SAMPLE

It becomes impossible to contact each and every individual of the population due to the limitation of essential resources like time and money. Therefore the study borrowed down to a representation sample to make the study more manageable.

Keeping in view of the objective and resources limitation of the study sample of 4 respondents are considered as most of the respondents are located in distant places of the country. The selection sample is representative of the population and is accurate and practicable.

DATA COLLECTION METHOD

The method of Data Collection is :

1. PRIMARY DATA

2. SECONDARY DATA

PRIMARY DATA

Primary Data are those data which are collected for the first time. It is always better to go for Primary Data since it is the first hand information and there are less chances of personal biasness and information can be collected with accuracy at the same time. It could be re tabulated and survey concerned in various forms this data can be used. For collecting the data I have chosen the In depth interview.

SOURCES OF PRIMARY DATA

INDEPTH INTERVIEW

SECONDARY DATA

Secondary data are not the first hand information. Secondary data are those that have been collected by other organizations like government agencies, financial organizations, newspapers and magazines. They collect original data analyze, tabulate and publish it.

A. SAMPLING UNIT

First step in developing any sample design as to clearly define the set of objectives technically called the universe to be studied. The universe can be finite or infinite; my universe was finite as I opted for specific White Goods Companies in U.P. West Region.

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B. SAMPLE SIZE

This refers to the procedure by which respondents should be chosen. In order to obtain a representative sample a non probability sample was drawn. Non Probability sampling can of following types:

JUDGEMENT SAMPLING

In this case stratified sample was done as the respondents were classified into well defined classes or strata that were distinct from each other.

DATA ANALYSIS

LIST OF WHITE GOODS INDUSTRIES

NAME OF THE COMPANY LOCATION

L.G. INDIA ELECTRONICS PVT LTD GREATER NOIDA

WHIRLPOOL INDIA FARIDABAD

VIDEOCON DELHI

SAMSUNG INDIA FARIDABAD

GODREJ DELHI

UTILITY OF STEEL IN CONSUMER DURABLES

The Consumer Durable Industry uses CRCA steel in the manufacturing of Refrigerators, Micro wave Ovens, Washing Machines and Air Conditioners. The CRCA consumption in consumer durable company is around 1000-1200 tonnes per month.

The CRCA steel in Consumer Durable is used in following things:

REFRIGERATORS:

DOORS

LEFT/RIGHT PANELS

GALVANIZED BACK PLATE

COMPRESSOR55

WASHING MACHINES

PANELS OF MACHINE

MICROWAVE OVENS

BODY OF MICROWAVE OVEN

INSIDE PANELS OF MICROWAVE OVEN

DOOR OF MICROWAVE OVEN

The Consumer Durable sector uses Cold Rolled Close Anneleaned steel which has a high strength and soften in nature. The company uses various kinds of steel like Galvanized steel, Color Coated Steel, Pre coated steel etc. Some of the steel is when reach to the customer, it is then again processed to meet the requirements like Rolling, Color Coating etc.

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CUSTOMER SURVEY

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LG ELECTRONICS INDIA PVT LTD

LG India Electronics Pvt Ltd. Is one of the main producers of consumer durables in India. It is a core producer of various kinds of refrigerators, washing machines, air conditioners etc. LG’s Greater Noida based plant has a capacity of producing 2 lacks of refrigerators in a month. For producing refrigerators it consumes CRCA steel which it procures from various sources like Bhushan, Essar, and Tata etc. The dimensions of CRCA steel are as follows:

CRCA steel Thickness Width Length

DC grade for Left/Right panels

0.42mm 573mm 2243mm

For Doors 0.38mm 651mm 1058mm

Left/Right panels for FF

0.42mm 670mm 2560mm

Doors for FF 0.38mm 670mm 1360mm

Back Plate (Galvanized)

0.42mm 670mm 1450mm

LG produces around 18-20 models of Refrigerators.

PRICING MODE

In LG the pricing is done on monthly, quarterly and six months basis. It is on Per Kg basis. Generally they follow fixed pricing method. But mainly it is Demand based which is regulated by London Metal Price.

PAYMENT MODE

The payment mode of LG to other companies like Bhushan, Tata is credit of 30 days.

With Essar particularly it follows L/C for 30 days.

With some new companies they go for under Purchase Agreement and SOB. This includes all pricing terms and other escalation clauses.

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In case the agreed party unable to provide the material on time or there is some delay due to some contingency, in that case the company diverts the order to some other suppliers like Bhushan, Tata and the penalty is applied on the previous party for not fulfilling the requirement. In purchase agreement the penalty policies are also included in which the Line Stoppage etc issues are explicitly mentioned. It is also based on the business relations and mutual understanding between the two parties.

To avoid such kind of situations the company places 120 % order of monthly requirement. For ex. If there is a monthly requirement of 1000 tonnes, then they place 1200 tonnes requirement with the company so that in case they fail to supply in next month then at least they can manage around 10- 15 days of their production.

LOGISTICS USED: Trailer by Road. The Freight charges are included in Purchase Agreement only.

LG ELECTRONICS- STRENGTH AND PROBLEMS FACED

LG Electronics as a consumer durable organization has a good reputation in the market. Their main strength lies in COMMITMENT & TRANSPERACY in Business. They assure their creditors of Payment surety.

But in case they face some problem with their suppliers, they require advance notification so as to plan their production process accordingly.

PROBLEMS FACED

With Essar they face some problem in terms of Logistics and complaint attendance. According to them the steel sent by Essar comes in Closed Trucks whereas steel despatched by Bhushan, Tata is in the Open Trucks.

Immediate attention of any kind of complaint regarding Quality issue is not immediately attended by Essar. It is taken care in the next of supply by Essar.

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FUTURE PROJECTS

LG had a NIMBUS project which even won International accreditation. The refrigerator has some extra features which are customized for Gents and Women personally. The refrigerator had Automatic Frost Free Adjustment. It has proper storage system for Frozen Foods. It was launched in various different colours and sizes.

COMPETITORS

LG’s competitors are:

Samsung

Whirlpool

Videocon

Godrej

Regarding the colour coated steel consumption; they import the Precoated Steel from Korea companies like Union Steel, Posco etc.

In production process they follow G-Six Sigma level and continuous development process Kaizen.

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WHIRLPOOL

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Whirlpool India is also one of the prominent players in the consumer durable sector. It is also the leading producer of refrigerators, microwave ovens, washing machines.

CORE COMPETENCIES

INNOVATION: The unique and compelling solutions valued by their customers to the brand create the competitive advantage and differentiated shareholder value.

OPERATIONAL EXCELLENCE: The methodology of solving the problems and the continuous improvement of products and process through the pursuit, acquisition and utilizing the knowledge using critical thought and planned experimentation helps them in achieving the operational excellence.

CUSTOMER EXCELLENCE: Excelling the customer expectation from the company, its brands, products and its services involves a three step process:

Know a customer

Be a customer

Serve a customer

Knowing a customer helps them in knowing who there customer are, how to treat them, how they can add value to them, and what the drivers of brand loyalty are. This information is gathered from the customer's data base history. This way they are better able to customize products for them and recommend the right product to solve problems. Being a customer is important to share customer knowledge and insights, drive actions based on customer insights, be passionate about their brands and customer loyalty and provide a positive voice for their brands.

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WHIRLPOOL INDIA

Whirlpool, right from its inception in 1911 as first commercial manufacturer of motorized washers to the current market position of being world's number one manufacturer and marketer of major home appliances, has always set industry milestones and benchmarks. The parent company is headquartered at Benton Harbor, Michigan, USA with a global presence in over 170 countries and manufacturing operation in 13 countries with 11 major brand names such as Whirlpool, Kitchen Aid, Roper, Estate, Bauknecht, Laden and Ignis. The company boasts of resources and capabilities beyond achievable feat of any other in the industry.

Whirlpool initiated its international expansion in 1958 by entering Brazil. However, it emerged as truly global leader in the1980's. This encouraging trend brought the company to India in the late 1980s. It forayed into the market under a joint venture with TVS group and established the first Whirlpool manufacturing facility in Pondicherry.

Soon Whirlpool acquired Kelvinator India Limited in 1995 and marked an entry into Indian refrigerator market as well. The same year also saw acquisition of major share in TVS joint venture and later in 1996, Kelvinator and TVS acquisitions were merged to create Indian home appliance leader of the future, Whirlpool India. This expanded the company's portfolio in the Indian subcontinent to washing machines, refrigerator, microwave ovens and air conditioners.

Today, Whirlpool is the most recognized brand in home appliances in India and holds a market share of over 25%. The company owns three state-of-the-art manufacturing facilities at Faridabad, Pondicherry and Pune. Each of these manufacturing set-ups features an infrastructure that is witness of Whirlpool's commitment to consumer interests and advanced technology.

In the year ending in March '06, the annual turnover of the company for its Indian enterprise was Rs.1375 Crores. According to IMRB surveys Whirlpool enjoys the status of the single largest refrigerator and second largest washing machine brand in India.

The company's brand and image speaks of its commitment to the homemaker from every aspect of its functioning. It has derived its functioning principles out of an undaunted partnership with the homemakers and thus a slogan of “You and whirlpool, the world's best homemaker” dots its promotional campaigns. The products are engineered to suit the requirements of ‘smart, confident and in-control' homemaker who knows what she wants. The product range is designed in a way that it employs unique technology and offers consumer relevant solutions.

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WHIRLPOOL PRODUCT RANGE

Whirlpool has a wide range of products which includes products like:

Refrigerators

Air Conditioners

Washing Machines

Microwave Ovens

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REQUIREMENT OF CRCA STEEL IN WHIRLPOOL INDIA

MONTHLY: 300 TONNES

QUARTERLY: 800 TONNES

SIX MONTHS: 1700 TONNES

PAYMENT TERMS WITH ESSAR

Whirlpool with Essar follows Advance Payment terms as per the policies of Essar. For new requirement they go for L/C route.

WITH OTHER COMPANIES

With other companies, Whirlpool procures steel on 30 days credit terms. The other companies include Tata, Bhushan, Vardhman etc.

STEEL CONSUMPTION

Whirlpool manufactures various Consumer Durables products like Washing Machine, Refrigerators, Microwave Ovens and Air Conditioners.

Consumption Pattern

REFRIGERATORS

CRCA STEEL GP SHEET

DOORS BACK PLATE

LEFT/ RIGHT PANELS

WASHING MACHINE

CRCA STEEL GP SHEET

BODY PANEL LOWER PART OF MACHINE

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MICROWAVE OVEN

CRCA STEEL GP

OUTER PART OF MICROWAVE LOWER PORTION

LOGISTICS USED

The steel procured by Whirlpool is sent in closed trucks.

COMPETITORS OF WHIRLPOOL

There are various competitors of Whirlpool. Some of these are:

SAMSUNG

LG

HITACHI

HAIER

GODREJ

Whirlpool has a big strength in providing the products according to the customer needs and demands. The core competency of whirlpool lies in maintaining the good customer relations and attendance of customer complaints quickly. Whirlpool has a good image in terms of Payment. Payment within 30 days is the policy which is followed in Whirlpool India.

The products manufactured in Whirlpool are tested properly and less power consumption products. They have a wide range of products which cater needs of the consumer to larger extent. They follow proper marketing mix and always give tuff competition to its competitors.

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FINDINGS, SWOT ANALYSIS OF ESSAR STEEL WITH

SUGGESTIONS, LIMITATIONS AND CONCLUSION

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FINDINGS

Some of the findings regarding the Consumer Durables Sector are as follows:

There are 8 major consumer durables companies which consume large amount of steel.

They have frequent requirements of CRCA/GP steel from various Steel manufacturers.

They prefer to have steel from nearest plant in order to minimize the cost and time.

Mostly consumer durable companies have a requirement of using CRCA steel in manufacturing the product like Refrigerator, Washing Machine etc.

The major player in U.P. West is L.G. Electronics which consumes 1000-1200 tonnes of CRCA steel from various steel manufacturers.

All consumer durable companies keep alternative sources open to meet the contingencies. For example: LG always keep a alternative source of Bhushan when they place an order with Essar.

L.G. and other companies have a top preference of Bhushan and Tata. Essar also plays a major role in fulfilling their requirement.

Consumer Durable companies generally sign the agreements with the procuring companies in which the terms like Share Of Business and Payment Policies are explicitly defined.

The main competitor of Essar is Bhushan and Tata.

Bhushan has a largest market share in White Goods segment and its major customers are L.G and Maruti which consume 40% CRCA steel

Consumer durable companies have a top preference for Quality and commitment from the procuring company.

They maintain their inventory in advance to meet the contingencies and they need credit time for payment.

Most of the companies require TEST CERTIFICATES while purchasing the steel from steel manufacturers.

Some of the companies face problems like of attendance of complaints, late delivery of steel with Essar.

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The major problem which they face is of payment policies followed by Essar. Essar has a policy of Advance Payment. They hesitate in paying advance to Essar which ultimately lead them in developing the other source.

Most of the companies follow Kaizen in their Production System and JIT in inventory.

In purchasing the CRCA steel, mainly three departments are involved:

Purchase department

Marketing department

Production department

SUGGESTIONS

Essar Steel is a well known company but when it comes in the consumer durables sector, then Essar takes a back seat. Competitors like Bhushan, Tata, Ispat are their all time favourite. The image can be changed and can be enhanced more by the following ways:-

1. By sending Occasional greeting cards along with the company brochures to white good companies to General Managers and Purchase Managers.

2. Sales Person should visit the companies like L.G., Whirlpool and Samsung at the time of procurement as well as at the time of production. This will increase the loyalty of the company towards the consumers (White Goods Companies) and this will help in the increase in the sales of Essar Steel.

3. By starting delivery to the destination at the minimal cost to the heavy purchasers.

4. The material despatched to the customers in an Open Trucks so that there should not be any problem in unloading the material at the factory premises.

5. Attendance of complaints and the customer grievances should be attended quickly and on time.

6. Quick and Periodical development in product and services should be there in order to keep the customer intact and interested in the business with the company.

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SWOT ANALYSIS OF ESSAR STEEL

STRENGTH

Essar Steel is a well known brand in the steel market

It is one of the big private player in white goods segment

Provide quality and genuine product

WEAKNESS

Limited Product Lines

Lack of Marketing Activities

OPPORTUNITIES

Fulfil the requirement of the customer in time

Location provide help in capturing the market

Establishing the various Stockyards in different locations for quick availability

Quick attendance of complaints and on time delivery will help in maintaining the band image

THREATS

Other companies quick delivery of material and payment terms

If Essar Steel does not cash out the opportunity of first entrant, then there is always a fear of other entrants.

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LIMITATIONS OF THE STUDY

There were some limitations while doing the project due to the limited resources availability. Some of these are:

Location: Very few companies have their production and marketing offices set up in NCR or nearby areas. Most of the offices are located in distant locations like East U.P. or in Mumbai.

Confidentiality: Extracting the price and freight charges information helps in making the strategy of any company. So being the vital content in strategy making, extracting the exact information was very difficult.

Limited contacts: Since I covered only NCR, so the study got restricted to some companies only. The contacts given to me for the survey was limited in number and hence the study got restricted to only few companies.

NEW PRODUCT DEVELOPMENT

Essar Steel produces quality and best product among its competitors. But there is always remains a scope for developing new product which can add more value to the customers.

Essar Steel can establish a new product line of COLOR COATED which will give a thrust of customization among its customers. In this COLOR COATED Steel the required colour can be coated on the steel according to the requirement of the customer and can be despatched to the customer. In this way a customer will get required steel in which he will directly apply the steel in making the product.

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CONCLUSION

Under the brand name of Essar Steel, it has well segmented its market and tried its best to serve the customers according to their needs and personalization. The Essar Steel provides wide range of Flat Steel products it has managed to give tuff competition to some big players like Tata, Bhushan etc. The main objective of Essar Steel is to provide the world class steel to the customer.

The company can get the opportunity to enter to new markets of Consumer durables of U.P. East. Consumers like L.G., Whirlpool wants to get the steel product at the minimum cost and on time delivery. So they procure it from the nearest market to reduce the transportation cost.

Recently Essar Steel is in the process of establishing new production line of COLOR COATED line of Steel where they can customize the product and can cater the needs of the customer to higher levels which will finally help in increasing their sales.

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BIBLIOGRAPHY

www.ipcindiansteel.com

www.worldsteel.org

www.steelnic.in

http://www.eef.org.uk/uksteel//about+the+industry/making+steel/diagrams/production_of_molten_steel.htm

DOWNSTREAM PRODUCTS

www.bhushan-group.org

www.bhushanltd.com

www.uttamgalva.com

www.ispatind.com

www.vardmansteel.com

www.tataryerson.com

Steel glossary

Essar catalogues

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