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A
PROJECT REPORT OF
PRACTICAL TRAINING
FOR THE
UNDER GONE AT:-
INDIAN RAYON
A UNION OF ADITYA BIRLA NUVO LTD.
1
ACKNOWLEDGEMENT
It is our great pleasure to put this report before you,
we are very much thankful to our principle Mr. BHATT,
who has provide us such a valuable opportunity and we
also thankful to B.B.A. in charge professor sandhe.
We are very much thankful to Ms. RICHA SHAKLA
& Mr. J. V. DAVE (librarian) & HRD, IR and all other staff
member, who have provide us such valuable information
and helped to prepare this industrial report.
2
PREFACE
B.B.A. is a special field of management where the
meaning giving during the regular study which is more
related with the business world so as the practical
knowledge should be hand with the decrial aspect this is
the main aim of the coerces of B.B.A. which I enjoy the
privilege to efficient too.
In our country India, the population is increasing
rapidly so we have a lot of manpower but we don’t have
any alternative to use this manpower, so the problem o
unemployment is also increasing day by day. We can
save this problem by developing the industries.
Indian RAYON is a large-scale industry. Generally
LSI doesn’t create much employment opportunities but it
is not so in the case o Indian RAYON through the
company is LSI is giving employment i.e. more than 4000
person.
LSI helps in the development of the country by
increasing educational level, communication level, the
living standard of the people etc.
Thus LSI is needed for the development of the
country.
3
INDEX
No. Particular Page
No.
01 General Information 05
02 Personnel Management 27
03 Marketing Management 51
04 Finance Management 66
05 Future Plan 87
06 Achievement 89
07 Conclusion 91
08 Bibliography 93
4
5
INDEX
NO. PARTICULAR PAGE
NO.
01 Name & Address of the company 07
02 Present managing body 08
03 History & development of the unit 11
04 Size of the unit & form of
organization
12
05 Manufacturing processes& types of
products
14
06 Organization structure with chart 19
07 Time Keeping System 21
08 Employees and Welfare services 24
09 Contribution of the unit to the
industry
26
6
NAME & ADDRESS OF THE COMPANY
NAME
“Indian Rayon”
(A unit of Aditya Birla Nuvo Ltd.)
ADDRESS
Marketing Office
712/713 “Midas” 7th floor
Sahara Plaza Complex
Andheri – Kurla Road.
J.B. Nagar Andheri (east)
Mumbai – 400050
REGISTERED OFFICE
Indian Rayon & Industries Limited
Veraval – Junagadh Road,
Veraval 362266
Phone (02876) 245711
FAX NO. (02876) 243220
WEB SITE www.adityabirla.com
www.indianrayon.com
E-MAIL [email protected]
7
PRESENT MANAGEMENT BODY
Promoters : MR. MORARJIBHAI
Managing Director : Dr. BHARAT K. SINGH
Managing Group : ADITYA BIRLA GROUP
Board of Director : MR. KUMAR MANGALA
BIRLA
MR. RAJESHREE BIRLA
MR. H. J. VAIDA
MR. B. L. SHAH
MR. P. MURARI
MR. B. R. GUPTA
MR. TARJANI VAKIL
MR. VIKRAM RAO
MR. G. P. GUPTA
MR. S. K. MITRA
MR. RAKESH JAIN
MR. K. K. MAHESHWARI
MR. ADESH GUPTA
Chairman : KUMAR MANGALAM
BIRLA
Manager : MR. K. K. MAHESWARI
Chief Finance Officer : MR. ADESH GUPTA
Company secretary : MR. DEVENDRA
BHANDARI
8
EXECUTIVE RAYON DIVISION
MR. K. K. MAHESWARI – Group executive president
MR. V. G. SOMANI _ President
MR. D. P. MODANI _ JT. President
(Finance & Comm.)
MR. K. SURESH _ SR. Vice President (Pro.)
MR. K. D. JOSHI _ SR. Vice President (mkts)
MR. P. MARSIMHA RAO _ Vice President (HR)
ADVISORS
SHRI M. C. BHAREJA
SHRI S. B. AGARWAL
SHRI R. I. BAWALA
AUDITORS
Khimji Kunwarji & Co. Mumbai
S R Batliboi & Co. Mumbai
OTHER BRANCH AUDITORS
K. S. Aiyer and Co. Mumbai
Delaitle Haskins & sells, Bangalore
9
BANKERS
State Bank of India
United Bank of India
UCO Bank
Corporation Bank
Central Bank of India
Punjab National Bank
City Bank
American Express Bank Ltd.
Hong Kong & Shangahi Bank
Bank of American NT & SA
State Bank of Saurastra
State Bank of Hyderabad
Allahabad Bank
Standard Chartered Bank
State Bank of Bikaner & Jaypur
HDFC Bank Ltd.
10
HISTORY & DEVELOPMENT
Indian rayon factory was established in 1956 by
MR. MANOJBHAI VAIDYA, this plant was set up for
manufacturing viscose filament yarn. Late prime minister
SHRI LAL BAHADUR SASHSRI laid the foundation stone
of this unit on 21st June 1959. The company was
incorporated under the company act 1956 on 26th Sep,
1956 & company was given business commerce
certificate on 13th Feb, 1958. On 13th April 1963 Company
took its trial production. The regular production of rayon
yarn was started on 27th Sep 1963 while commercial
production was started on 2nd Oct 1963. As a result of
strike and chaos with in the unit the present management
is Birla Group took over the company on 18th 1966 due to
expansion. “Indian Rayon and Corporation Pvt. Ltd.”
Named it become “Indian Rayon and Industries Ltd.” After
that the company is the Adyta Birla Group is the no. 2
business group in Indian. Company develops their plant in
different states of India.
11
SIZE & FORM OF ORGANIZATION
The size of “Indian Rayon & Industries Ltd.” Is large-
scale industry. We can say that this unit is heavy
industries, because it covers all the feature of heavy
industry like. It has large amount of capital, huge
production cycle and also uses heavy and costly
machinery. Hence it quite natural that this industry require
large number of persons.
“Indian Rayon & Industries Ltd.” is public limited
company. This company was incorporated on 26th Sep,
1956 under the company’s act 1956, and they issued at
public issue, thus the production process is also long
duration.
The IR & IL is capital oriented because most of work
and its production is very large, so it can be said as heavy
and large scale industry.
12
The IR & IL consist five top-level management:-
General Management
Personnel Management
Marketing Management
Production Management
Financial Management
Here, each department has his department heads.
The organization adopts departmentalization. The
position including on horizontal lines as per relationship.
13
MANUFACTURING PROCESS & PRODUCTS
The main product of IR & IL is viscous filament
rayon yarn (VFY). For producing rayon yarn raw material
is very important, which are as follow:-
1. Wood Pulp
2. Caustic Soda
3. Carbon Bisulphate
4. Sulphuric Acid
About 90% of the above raw materials are available
from domestic market and rest of 10% of raw material is
imported from South Africa, Canada, Sweden & Malaysia.
The Seat of wood pulp are made of cellulose from
the following trees:-
- Eucalyptus (South Africa)
- Spreell (Canada)
- Bamboo (India)
14
The Process is carried out in the following steps,
which are as under:-
1. Conversion of Wood
Cellulose into cuboti cellulose (maximum
of wood pulp with NAU)
2. Conversion of cuboti cellulose into sodium
cellulose xanthenes
3. Conversion of sodium cellulose xanthenes
into viscose
The process is carried out in 8 steps such as:-
1. Steeping
2. Pressing
3. Shredding
4. Aging
5. Xantharation
6. Dissolving
7. Repenting, Filtration
8. Caustic Preparation
15
The production process of the VFY can be
described in the following section:-
* Viscous Selection:-
In the section process from wood pulp to viscose is
done means Viscous manufacturing.
* Spin Bath Section:-
This viscose is expiated through the fine holes of
get into coagulation bath of sulphuric acid and slot which
neutralize than alkaline content of the vicious and
regenerated the original cellulose of continuous filament.
* Spinning Section:-
This section is also called as “cake” formation
department. The yarn is through against the side of this
rotation pat when it is laid in the form of the cake because
of the channel depending on the speed of the revolving
pat.
* Textile Section:-
The cake is now ready for winding in the form of
cones.
16
* After treatment Section:-
After washing section i.e. washing room of the cake,
when the cake is burn in the opening part it in full of acid
and relatively too much weak. It is started in very humid
chamber. The cakes are washed through many types of
water like water etc. and thus all the excess liquid is
removed and cakes are ready for coning.
* Packing Section:-
After winding the cones, these are graded by visual
inspection now they use cardboard for packing because it
is easy to handle and taken less weight then wooden box
on box the full information is printed.
A. Name of the party to whom
the goods are dispatched.
B. Date packing
C. Quality, grade and weight
D. Registered trademark of the company
E. Colors of cones
17
PRODUCT:-
As we know the main product of the firm is viscose
filament yarn as subsidiary products. They produce the
following products, which are needed in the production of
the yarn.
Sulphuric acid
Carbon disulphide
Sodium sulphet
The yarn used to produce cloth. The company
produces the yarn of more than 30 colors. Some are
mentioned here:-
Apple green
Black, Blue
Green
Golden Yellow
Lemon Yellow
Maroon
Red
Super White
Metal Brown
Golden Brown etc.
18
ORGANIZATION STRUCTURE WITH CHART
This department has full responsibility, authority and
accountability of any task related to the production. In
short, this department is the top accountable person of
this department.
The authority line of the department flows from top
to the bottom and responsibility from bottom to the top.
This department is answerable to the managing director.
With a view to decentralizing of authority IR & IL has
adopted well-balanced line staff type of organization to
manage day-to-day activities. The chart of the
organization of IR & IL is as under:-
19
20
Executive
President
Production
Department
Engineering
Department
Commercial
Department
Administration
Department
HRD
Department
Viscose
Spin bath
Spinning
After
Treatment
Textile
Chemical
R & D
Quality
Control
Maintains
Electrical
Instrument
Finance
Share
Store &
Purchase
Bardhana
Internal
Audit
Raw
Material
Legal
Sales
Time
Office
Welfare
Labor
Office
Personnel
HRD
Estate
Security
TIME KEEPING SYSTEM
The Aditya Birla nuvo Ltd. Holds efficient time
keeping system. The company has installed computerized
time keeping system.
The time keeping system of Aditya Birla Nuvo Ltd.
Includes use of:-
Punch card system:-
All employees including all the staff member and
workers have been issued punch cards. There are 7
machines for punching and connected with computers.
Out of this six machines are at the gate, one is at HRD
department. When employees enter in the gate, it must
punch the card into machines and at the time have
existed also.
Attendance Registers:-
Time officers keeps attendance registers, many
workers given attendance slips also in the system they
must fill this slips also at each and every time of their
entry as well as the register collect the data through
computers and their salary and wages prepared from this
collected data.
21
Shift Timing:-
There are 3 shifts at Aditya Birla Nuvo Ltd. They are
as under:-
General Shift: - 08:30 AM to 05:00 PM
Lunch Break: - 12:30 pm to 01:00 PM
Thus for each and every employees working hours
is eight hours.
Shift Time
A 07:00 AM to 03:00 PM
B 03:00 AM to 11:00 PM
C 11:00 PM to 07:00 AM
22
Leave Facility:-
Time officer of Aditya Birla Nuvo Ltd. Has presided
the leave benefits for two categories of personnel:-
Leave for permanent Labor:-
20 days earned leave
10 days causal leave
20 days sick leave (10 full days)
Leave for staff categories:-
30 days privileged leave
10 days causal leave
10 days sick leave
Over Time:-
The over time payment is double than the usual
wage payment
Other Benefits:-
Time officers also perform other duties like
1. Loan, advances to employee
2. Provident funds
3. Life insurance polices etc.
23
EMPLOYEES WELFARE SERVICES
IR & IL provided various services to the employees
or who serves the origination.
Quarter Facilities:-
The IR & IL provides quarter facility to its workers &
staff member. They provide housing board house at a
subscribed rate at the law installment system following 20
years of time the IR & IL provides ownership of such
hoses to the workers.
Medical Facility:-
There is separate dispensary and MBBS doctor,
DR. GANATRA SIR, checks the patients not only but also
their family and also provides medicines at cheapest rate.
Canteen Facility:-
There is canteen facility at IR & IL at a very cheep
rate. There is separate canteen for workers, staff and
officers, where they get snacks and tea at cheap rate;
they provide 25 paisa tea, and 100 paisa snacks etc.
Milk Facility:-
The IR & IL provides 500 grams of milk bag to its
workers for the energetic work.
24
Uniform Facility:-
In the IR & IL there is uniform to every person who
secures the organization and there is unique uniform to
everyone.
School Facility:-
The IR school at veraval has there out standing
name in the entire Gujarat because there is sport’s team.
Cultural and entertainment programmed, sports organized
by IR & IL for develop their employees and they are also
given monitory reward in return to them, club facility,
swimming pools are provided by IR & IL.
VRS Scheme:-
This facility can be given by IR & IL to their
employees and 370 employees also take benefits as
these scheme.
Pension Facility:-
It provides pension facility to its employees after
retirement.
25
CONTRIBUTION OF THE UNIT
When we consider the contribution of the unit is has
get up level position in manufacturing of 120-deener
yarns. There is monopoly of producing 200 diner yarns. In
export market contribution of their unit is very well in
Indian market 3 unit of Birla.
Group manufacturing Rayon yarn century Rayon,
Grassim Rayon, Kindalco Rayon these 3 unit cover about
75% of the total market.
26
27
INDEX
NO. PARTICULAR PAGE
NO.
01 Introduction 29
02 Organization of Personnel
Management
30
03 Manpower Planning 31
04 Requirement, Selection & Induction 33
05 Wage & Salary Administration 38
06 Training & mgt development
programmers
39
07 Promotion & Transfer Policy 41
08 Job Description 43
09 Performance Appraisal System 44
10 Working of E.S.I. scheme 46
11 Study of provident fund scheme 47
12 Grievance handling procedure &
working of trade unions
48
28
INTRODUCTION
Human Resource is the great assets of the
business enterprise. It is the manpower that operates the
machines. Process the raw material into finished
products. But “Human factor refers to whole consisting of
inter related, independent and inter acting physiological,
sociological and ethical components” hence there is need
of management of human resources in order to have
proper planning, organizing, staffing, directing and
controlling in order to achieve individual and organizing
goal.
With reference to Aditya Birla Nuvo Ltd. The HR
department is divided into two divisions:-
- Human Resources Department
- Training and Development
29
ORGANIZATION OF PERSONNEL DEPARTMENT
30
Personnel
Department
Vice President
H. R. D.Personnel
General Manager
Chief Manager
Manager
Welfare
DR. Manager
Community Labor Office
Manager
Labor Manager
SR. Officer
Time Officer
SR. Officer
MANPOWER PLANNING
Manpower is key economics resources, which
should demand the same attention from the company that
it gives planning at finance, equipment, raw material,
production, sales and profit.
A manpower planner function should be:-
To indicate the manpower constraints on company
policy for the future.
The interpret production and sales forecast in terms
of manpower requirement.
Manpower planning is the process of assign the
right number of people and right kind of people at the right
place at the right doing work for which they are
economically most useful, a manpower plan is necessary
at any organization to know about the posting of the
prospect personnel and their skills, which would future
result into training programmer.
31
Importance of Manpower Planning:-
- Only people can spread knowledge resources
across the company
- Individual knowledge is the staffing point for
organizational knowledge
- The executive sources of knowledge for an
organizational and people
- It is only people who can convert knowledge into
efficient action
- The knowledge of each individual can not be
replicated
32
RECRUITMENT & SELECTION
“Requirement is a process of searching for
prospective employees and stimulated and encouraging
them to apply for jobs in an organization.”
- EDWIN FLIPPO
Requirement Process:-
Requirement process for blue-color worker is called
traditional method. These are stages of requirement
process for blue-color worker, they are as under:-
- Within org. i.e. permanent workers
- Badly or temporary workers
- Trains
- Apprentices
- Causal Applicant
- Employees’ recommitment of trade union
- Labor Contractors
33
If any worker remains absence or leaves the job
and it become possible to transfer any other worker in the
vacancy if the worker dies than as per vacancy available
to his son is given to “son of the souls” is requirement
labor.
Selection is the process to choose he substitute
candidate by respecting or excluding unsuitable.
Selection is also negative process. In selection
some employees are particular job but many employees
are rejected.
The causal worker is employed for an occasional
work.
The present split up to worker & staff IR & IL is
given below:-
Permanent worker 2817
Badly Worker 850
Apprentices’ worker 77
Staff Worker 612
Total 4356
34
Staff Planning:-
Aditya Nuvo Ltd. Discuss various aspect related to
the staff personnel which hold them into the organization,
such importance issue are:-
- Comparable perks
- Top mgt commitment
- Recognition in organization
- Clear goals
- Higher positive job
Manpower Planning for Worker:-
All the department need additional requirement of
manpower has to contact the personnel, which makes the
arrangement for the required manpower. Every month the
personnel department issue personal requisition from the
all department and this forecast its manpower demands of
each department accordingly the requirement are made.
The worker is divided into for categories:-
- Visa
- Permanent
- Badly
- Temporary
35
The badly worker is a substitute for the permanent
worker in the absence of the entire permanent worker.
The temporary worker is employed for a limited
period for a temporary work.
For the worker it is made by supervision and welfare
officers, at the time of selection physical fitness past
experience, honesty, etc are given importance.
The selection employees are taken on the period of
six month or twelve month all the employer if Found
suitable during the period are chosen during the finial
selection and gets permanent job.
For technical staff and administrative person, in&
ir arranges a written test and it is followed by personal
interview. The performance of are candidate in both
written test and oral test is given base for selection.
36
For white collar job Company adopts the following
stages for selecting prospective candidates.
- Reception of application
- Preliminary interview
- Application blank
- Psychological test
- Interview
- Reference checking
- Medical examination
- Final Selection
Induction:-
Induction prefers to the introduction of a person to
job and organization.
The candidate is required to work in all concentrate
departments and is also made familiar to the rules and
regulation of company.
IR & IL does not believe in induction because it
believes that it is wastage of time and it does not give
importance to the induction.
37
WAGE & SALARY ADMINISTRATION
Wages and Salary administration refers to the
establishment and implementation sound policies and
practice of employ compensation. Wages and Salary are
given to employee as reward for they contribution to
production process.
Usually, wages refers to hour’s rate paid to such
group of production and maintenance employ whom we
call as blue color workers while on the other hand salary
refers to monthly paid to decrial, administration and
professional employees white color workers.
There are two systems by which wages to be paid
to the worker:-
Time wage system
Piece wage system
The worker can be divided into three diff. types:-
Casual
Temporary
Permanent
The IR & IL gives good rate of salary to the staff &
worker.
38
TRAINING & MANAGEMENT DEVELOPMENT
PROGRAMME
“Training is an important aspect of personal which
increase the knowledge and skill of a worker for doing
specific job.”
- C-B MMORIA
Training for the officers:-
For the success of business training is important.
Company has to give training to the officers so they can
match with new technology, so IR & IL giving good
training facility to their officers.
Training for the workers:-
The HRD department prepare schedule for the
worker in need of training to develop the job main
purpose of the company is to give knowledge about new
technology.
39
The main purpose of the training is as under:-
- To give technical knowledge & safety measure
training.
- Discipline, good conduct & job responsibility.
- Operating the working programmed.
- Improving the skill knowledge of workers towards
quality of products.
Training for supervisors:-
Supervisor plays a very vital role in the organization
and supervisor is also important for industrial piece so
supervisor should be trained for their work by increasing
workers efficiency supervisor can increase production so
by this ways company should reach to the goal by the
help of supervisor.
IR & IL gives good training to the supervisor;
supervisors are trained under the guidance of the chief
executives of the company.
40
PROMOTION & TRANSFER
Promotion:-
“A Promotion is the transfer of an employee to a job
which pays more money or one that carries preferred
status.”
Promotion is given after three or four years on the
basic of disciplinary action and by performances appraisal
system.
Employees are prompted within organization in
terms of vacancies or creation of new post. Aditya Birla
Nuvo Ltd. Adopted to take the advances of the
employees. One very well aware of company’s policy and
production procedures in terms to motivate them.
41
Transfer:-
“A lateral shift causing movement of individual from
one position to another usually without involving any
marked change in duties, responsibility, skills needed or
compensation.”
Aditya Birla Nuvo Ltd. Runs various units located at
different places within the country, yet under this unit
transfer practices not followed, sometimes some workers
are transferred from one department to another because
of physical fitness problem.
42
JOB DESCRIPTION
Job description means to give the information and
guidance to candidates about this particular job for which
he has been selected. It is a process of giving information
to candidates about his status, duties, responsibility etc.
IR & IL the duties and responsibility of
administrative department are collected through job
description are as under:-
Observation of employees at the first time at work
Discussion with department heads and outside
experts.
At managerial level
In this unit when managerial level person is selected
following is the information given to them:-
- Nature of job
- Duties & Responsibility
- Job summary
- Position & Status
- Working condition
43
PERFORMANCE APPRAISAL SYSTEM
It is the process of evaluation the performance and
qualification of the employee in terms of the requirement
of the job, for which he is employed.
Performance appraisal of Aditya Birla Nuvo Ltd. Is
carried on three ways:-
Motivation:-
“The emphases industrial psychological has shifted
form the studies of the isolated individual and physical
environment to the consideration of motivation and
morale.”
In IR & IL motivates staff by performance appraisal,
every staff member recognize his work and he always
tries to do better work and effective work if his work is
recognized.
IR & IL motivates staff by performance appraisal,
example their regularity work, and their honesty an also
such things are being kept in mind.
44
Quality circle:-
Quality circle is a group of workmen working
voluntarily for improvement in their total quality of work.
The basic objective is help workmen in developing
themselves there are 36 quality circle in IR & IL.
Suggestion Scheme:-
It is a process of inviting suggestion from employee
to motivate employees by involving in the organization to
development and improvement of the company.
In IR & IL employees suggestion are invited and
then possible suggestion are put into the action, persons
who suggested the suggestion are informed reasonable
for implementation, practical suggestions are awarded.
45
WORKING OF E. S. I. SCHEME
E. S. I. means employees states insurance; It is
necessary in all the companies according to 1948
companies act. Insurance is provided to the worker, the
company makes the dedication of salary of the worker
every month.
If accident accrue on the job to the workers, he is
reserved monthly is given him all from the insurance, if
any kind of illness is there two monthly is used by the
company, worker can get salary with work are to two
months according to this shame.
So it can be said that IR & IL allows the law of
government of Employees State insurance, there is no
ESI scheme but every employees are insured in oriented
insurance company.
46
STUDY OF PROVIDENT FUND SCHEME
Provident fund scheme as per rules regulation of
the government, the provident fund is compulsory saving
from the salary of the employees. The provident fund
scheme of the company follows law of 1955 thus at last
when the employees retire he get all the amount.
Thus the employees can get loan the amount of
provident from and can withdraw at required time incase
for marriage, sickness, house loan etc.
In this scheme personal department is responsible
as whole ill which 12 % of amount has been reserved as
provident fund out of basic plus variable clearness borrow
from provident fund allowance.
47
GRIEVANCE HANDLING PROCEDURE
&
WORKING OF TRADE UNION
“A grievance is any discontent or dissatisfaction,
whether expected or not, whether valid or not, airing out
of anything connected with the company which and
employee thinks, believe or even feels to be unfair, unjust
or inequitable.”
To handle and solve such grievance the Aditya Birla
Nuvo Ltd. Have special producer.
- In Aditya Birla Nuvo Ltd. The workman will take
his grievance in oral of written to his immediate
superior, such as section head. In case if the
complaint is against him, it should be written and
submitted to the next higher authority.
48
- If the decision of his immediate superior or the
next higher authority is not satisfactory, he has to
forward to the manager of the department.
- The management brings out the situation to the
grievance shift, if the workers are not satisfied or
reply is not received within seven working days,
the copy is forwarded to grievance committee.
- If grievance committee fails to solve the
grievance, the matter will be included in the
agenda for discussion at the next meeting of the
grievance committee.
49
Trade Union:-
“A trade union is any combination of persons
whether temporary or permanent, preliminary for the
purpose of regulation of the relation of workers and
employees or between worker and boss and for improving
restrictive conditions on conduct of any trade on business
and includes the federation of two or more trade union.”
Aditya Birla Nuvo Ltd. Has more than 2500
employees in the origination and for the state of
protection of their rights that have formed there are three
trade union:-
1. Indian Rayon Employees Union (IREU).
2. Indian Rayon Karmachari mandal (IRKM) –
Indian association with Hindu Mazdoor
Karmachari mandal.
3. Rayon Mazdoor Sangh (RMS) – Associated with
Bharatiya Mazdoor Sangh.
50
51
INDEX
NO. PARTICULAR PAGE
NO.
01 Introduction 53
02 Marketing Objective 54
03 Organization of Marketing
Department
56
04 Market Segmentation 57
05 Product Decision 59
06 Price Decision 60
07 Advertising 61
08 Sales Promotion 62
09 Channel of Distribution 63
10 Marketing Research Activity 64
11 International Market 65
52
INTRODUCTION
“A market any be considered as a convenient
meeting place where buyers and sellers gather for
exchange of goods and services.”
Marketing IS comprehensive term and it includes all
resources and a set of activates necessary to direct &
facilities the flow of goods and services from producer in
process of distribution. Marketing is typical seen as a task
of creating, promotion and delivering goods and services
to consumer and business.
Marketing people involved in marketing ten types:-
- good
- services
- experience
- events
- persons
- place
- properties
- organization
- information
- ideas
53
MARKETING OBJECTIVES
- To have highly delighted customer base
- To develop committed, target oriented, internal
customer, supplier relationship
- To ensure cost efficiency, profitable marketing
operations
- To maximize relation through focus on direct
sales and reduced logistics
- To develop customer centered, profit oriented
long term marketing strategies
- To ensure transportation of goods in strict
adherence of safety and environment guidelines
- To make better and quality product
- To provide a successful distribution of consumer
product
- To sell their product in new areas to make new
customer and satisfy old ones
54
Marketing department’s process to meet
objective:-
- Market environment analysis
- Strategic planning and budgeting
- Product delivery alignment
- System improved
- Customer satisfaction assessment
55
ORGANIZATION OF MARKETING DEPARTMENT
Organization is a form of co-operative EFFORTS. It
can be said that marketing organization consists of
number of position with number of people. Marketing
organization is important to the firm, as single person
cannot handle even marketing activity.
56
VICE PRESIDENT
Raw material & Storage
GeneralManager
DR. Manager
SR. Manager
Legal & Position
SR. Officer
Sales & Marketing
GeneralManager
Manager
Sales Manager
Transportation
SR. Officer
MARKET SEGMENTATION
“Market segmentation consists of taking this total
nitrogenous market for the product and dividing it into
several sub-market segments each of which tens to be
homogenous in all the significant aspect.”
In market segmentation, there are three elements,
which mostly used:-
- Mass marketing-one product
- Producing marketing-two or more product
- Target marketing-different production
The Market follows, the principle of “divided & rule”
there are two approach regarding market segmentation.
1. People Oriented Approach
2. Product Oriented Approach
IR & IL use “people oriented approach” method for
segmentation. Here they clarify the consumer on the
basis of location, income, geographical, etc.
57
IR & IL has its branch at AHEMDABAD, SURAT,
BANGLORE, Chennai and its head office is at Mumbai,
which take decision about all products. There are different
manufacturing companies that consumer and demand for
the specific type of yarn of very fine quality, this demand
for yarn differs from company to company on the basic of
their handloom production so, this company has
segmented the total market on the basic of product
application consumer wise.
58
PRODUCT DECISION
The production is any thing that can be offered to
satisfy the need or want. Production is the most important
and tangible component of marketing program. Product is
to be satisfied and for which whom the product is meant.
Product decision involves three important considerations.
- The development and introduction of product
- The modification of the existing products
- The elimination of unprofitable products
“Product planning determines the characteristics of
the product best meeting the consumer numerous desire,
characteristics that add stability, to product and
incorporate this characteristics into the finished product.”
IR & IL makes product planning according to the
demand of industries and situation and price of product.
Product development includes the technical
activities of product research, engineering and deciding.
Product planning is also given due importance in IR
& IL, it has also installed many automatic spindle in very
near past.
59
PRICING POLICY
Pricing determines the utility aspect of the product.
There is generally tendency of consumer that measures
the quality of product from its price. Price is exchange
value of the product or service which is always expressed
in terms of money. Right price can be determined through
pricing research and by adopting the test market
techniques.
All the company fixes prices on the bases of cost of
production and change of distribution, packing, etc.
The pricing objectives of company are as follow:-
- Return on investment
- To maintain its market share
- Price stability
IR & IL has not adopt any clear pricing policy but we
may say that the mixed policies of the following policies
exist in the company
- Cost oriented pricing policy
- Demand oriented pricing policy
- Competition oriented policy
60
ADVERTISEMENT
“Any paid from of non personnel communication of
ideas, goods or services by business firms identified in
the advertising message immediately to load to sale
immediately or eventually.”
The main aim of advertising is to make people
confidence about the product it is also useful to inform
people about the product.
IR & IL is very sound company producing the
industrial product and major factor producing rayon yarn
in India are in the handle of one mg the Aditya Birla
Group covered 75% of the rayon yarn market, thus there
is no question of advertising.
The rayon yarn is a raw-material of the textile
industries, the company published magazine & gives data
of manufacturing figures their export & import pricing
policies etc. thus in this way we can cell that direct
advertising is done.
61
SALES PROMOTION
“Promotion consists of those activities that are
designed to being a company goods or services to the
favorable attention of customer.”
In this method following tools have been used:-
- Buying allowance discount
- Display allowance
- Dealer’s contest
- Concession on net sales (2%)
- Free gift
In IR & IL there is no separate department for sales
promotion but sales department of Rayon division,
VERAVAL, follows it. Sales promotion affects in sales of a
company. Most of company does sales promotion to
improve market. Sales promotion activities do not relate
only with distribution but also delars and members of
sales force. Recently, the company gives key, chain,
dairy, calendar, wallets, decorative item etc.
To the consumer gift following programmers are
conducted by IR & IL for promoting sales
- Dealer meet each other
- Dealer visit to factory
- Price distribution To dealer’s
62
.CHANNEL OF DISTRIBUTION
Aditya Birla Nuvo Ltd. Has adopted it’s own sales
branches and sales officers in the context of this
distribution channel.
Rayon division adopts some time one level
distribution
Channel of distribution
For Rayon Yarn:-
Company ------Sales officer (or agent) -------
Customer One Level
For chemical yarn (by product):-
Company -------- customer
Company -------- dealer customer
Rayon division does not fix any channel; due to
following reasons:-
- Product characteristics
- Company characteristics
- Big investment
63
MARKETING RESEARCH
To manage a business well its future and to
manage its future is to manage its information. Besides
managing man, money, materials, machines, modern
business has to manage information carefully.
At some period chemist, techniques and president
visit to the market. Some times some persons are
employed by the com company for research and they to
customer to take opinion about the products of the
company beside, the following are also required:-
- Market survey
- A product performance research
- A sale forecast segment wise
IR & IL also takes interest in market research and
for the purpose they were using the service of
professional sponsor trade delegation only but than after
1988, they are research market through their own quality
control department and international level sent their
higher level executive for purpose of researching market.
The yarn of marketing research adopts by this
company has adopted survey method under this
distribution of simple free gift, discount, etc.
Telephone is used for marketing research.
64
INTERNATIONAL MARKET
The exchange relation between two national
boundaries can be called as “international market.” This
word is used for sales exports and for purchase of
important in international market. The IR & IL doing the
both import & export. The company exports 70% of its
total production to the various countries through its own
office at Mumbai. The company is using shipping
transport to exports their products. The company is export
the following countries:-
- United kingdom
- Turkey
- United state of America
- Italy
- Spain
- Philippines
The company also imports the raw material for
rayon yarn from south Arabia and Canada. The company
also imports wood pulp. They have established their own
training house in foreign countries. IR & IL gets order and
reads export demand.
65
66
INDEX
NO. PARTICULAR PGE
NO.
01 Introduction & Objective 68
02 Organization of finance & account
department
70
03 Financial planning 71
04 Capital structure- 73
05 Financial Leverage 74
06 Capitalization-over & under
capitalization
75
07 Management of fixed assets-capital
budgeting
77
08 Management of working capital-
profitability & dividend distribution
81
09 Profitability & Dividend Distribution 83
10 Right issue, bonus issue, right debenture issue
85
67
INTRODUCTION & OBJECTIVES
Finance is a life blood of business, we need finance
for production of goods and services as well as
distribution finance function assures an important role in
the business system, it is said that businessman takes
money to make money, this is not true; actually if you
have money and you manage it properly, you will make
more money, this means mgt of finance is necessary for
all.
Important of finance can’t be measured; it is really
key info business operation. Money is universal lubricant,
which keeps enterprise dynamic. Financial management
has under gone many charges, it has gained a lot of
important over time and success of every business largely
depends up to the financial position of the business.
68
There are three key elements for process of
financial management:-
1. Financial Planning
2. Financial control
3. Financial decision making
Objectives:-
- To produce wealth for the business
- To generate cost
- To supply adequate return on investment
- To protect business from risk and uncertainty
69
ORGANIZATION STRUCTURE
OF
FINANCE DEPARTMENT
70
SR. VICE PRESIDENT
(FINANCE)
GM
FINANCE
SR. MANAGER
(ACCOUNT)
Assistant Manager
Cash
Assistant Manager
Creditors
Assistant Manager
Salary
Officers Officers Officers Officers Officers Officers
FINANCE PLANNING
Finance planning is one of the most an aspects of
the financial manager’s job. The success of an
organization always depends upon the proper planning
refers to make plan about finance that how much money
is required how is collected, financial mgt has to make
plan for capital investment and also for working capital for
the ensuring year.
The financial planning is the responsibility of the top
level mgt, it is also essential that each financial act is
carefully planned before any action as the success of
failure of the firm depends totally on it.
IR & IL the task of financial planning is divided into 3
parts:-
Top Level:-
This level prepares plans pertaining to long term
requirement of the form its capital expenditure
permanents short term needs inflow and outflows.
71
Middle Level:-
This is considered by the virtually routine finance
plan; this level is generally concerned with the listing and
calculation of outflow.
Lower Middle Level:-
In this level generally concerted with the listing and
calculation of outflows, the whole process at this level is
divided into 2 parts:-
- Cash Flow
- Cash Outflow
In IR & IL unit financial decision are very crucial
head officers at Mumbai plan for new project of the
company.
72
CAPITAL STRUCTURE FINANCIAL LEVERAGE
Capital structure refers to the composition of capital
in other words the capital structure of the company refers
to make its capitalization.
Capital structure refers to the fix of long-term
sources of fund such as debenture long-term debit,
preference share and equity share capital.
PARTICULARS RS. (IN CRORES)
2007 2006
Share Capital 93.31 83.50
Reserve & Surplus 3,031.24 2,134.11
Secured Loans 2,071.62 1,084.21
Unsecured Loans 760.21 479.36
Preference Share 15.00 15.00
73
FINANCIAL LEVERAGE
Financial leverage is also called on trading of
equity; a company can finance its investment by variety of
sources such as preference share capital including
reserves and surplus.
Financial leverage is defined as the activity of firm
used financial leverage to magnify the effects of firms
earning per share, the financial leverage is controllable
and also completely avoidable leverage, the degree of
fund collected by the firm from outside is called financial
leverage.
The IR & IL also makes the use of the debt but the
following ratio will show the clear picture of it:-
Financial Leverage = EBIT EBT
= 716.35353.47
= 2.02%
74
CAPITALIZATION OVER & UNDER
CAPITALIZATION
Capitalization means total amount of company’s
capital or value of its capital stock. The total amount of
capital should be enough to meet its present and future
needs i.e. it must be property.
Over Capitalization:-
A company is said to be overcapitalization if its
earning is less in relation to its capital investment. In other
words when the real value of share is less then its book
value the company is said to be over capitalization.
Under Capitalization:-
A company is said to be under capitalization if its
earning is high in relation to its capital investment.
For the company the book value and real value of
shares are two main components for assessment of
company’s financial position, which can be calculated a
under:-
75
Thus IR & IL is over capitalization:-
Book Value = E. C. + Reserve & Surplus No. of equity shares
= 93.31 + 3031.24 1, 20, 00,000
Reason for recreate in value of company:-
- Presence of its various competitors in the market
and especially chain rayon
- Decrease in the price of yarn
YEAR/EPS RS.2002/03 6.132003/04 5.532004/05 8.782005/06 26.122006/07 32.00
76
MANAGEMENT OF FIXED ASSESTS
Fixed assets are those, which are fixed, and listed
by a business mgt fixed assets is very important task
which mgt has to face because fixed assets have
relatively higher cost.
To manage the fixed assets is that important task
facing mgt today because of risk and investment factor
the fixed assts are that kind of assets in which risk is for
long period of time.
Fixed assets create problem of replacement IR & IL
maintain the plan register in which each detail of every
fixed assets are essential moreover it has also appointed
C.A. and instrument experts. At least once in a year they
check all the assets of the company and certify then as
their condition the depreciation of fixed assets company
one calculated by diminishing balance method.
On fixed assets investment in IR & IL on 31st March,
2007 are as under:-
PRTICULARS MARCH/07 MARCH/06
Tangible:-
Land
77
Freehold
leasehold
13.06
26.61
5.75
25.70
Railway Sanding 0.69 0.97
Buildings 238.46 199.06
Cease Hold improvement 87.81 16.91
Plant of Machinery 2285.23 1294.20
Computer &
telecommunication
61.74 25.68
Furniture, Fixture &
Equipments
100.84 56.53
Vehicles & Aircraft 9.30 50.03
Livestock - -
Intangible:-
Entry/ License fees 367.11 202.67
Good will 68.41 45.92
Trade Mark/Brands 63.99 78.47
Software 53.85 15.90
Total 3896.11 1987.79
78
CAPITAL BUDGETING
The system of the capital budgeting is employed to
evaluate expenditure decision, which involve current
outlays but are likely to produce benefits over a period of
time longer than one year.
These benefits may be either in the form of
increased revenue or decreased cost.
There is various method of capital budgeting:-
- Internal rate of return
- Average rate of return
- Profitability index
- Pay back period
- Net present Value
Aditya Nuvo Ltd. Under takes capital budgeting
every year with the help of financial debt on pays back
period methodology.
79
The company always aims at increasing and
expending the installed capacity of rayon yarn production,
it constantly tries for its success, at present the installed
capacity of plant is 1500 tons/annum.
At present, the main objective of Aditya Birla Nuvo
Ltd. Is replacement and modernization of machine and
fixed assets and business expansion by adding new
machine and technology, the decision taken by the unit
base on pay back period?
80
MANAGEMENT OF WORKING CAPITAL
Working capital is concerned with management of
current assts; it is an important integral part of financial
mgt as short term survival is prerequisite for long term
success. The operating cycle can be said at the heart o
the need for working capital. It is operating cycle of
working as per balance sheet of IR & IL.
Working capital management is concerned with the
problem that arises in attempting to manage the current
assets, current liabilities & the interrelationship that exists
between them. The term current assets refer to those
assets which in the ordinary course in cash within one
year without under going a domination in value & without
disrupting the operation of the firm.
Working capital of Aditya Birla Ltd. March ‘07
81
Current
Liabilities
RS. In
CRORES
Current
Assets
RS. In
CRORES
Acceptance 13.791 Inventories 558.37
Sundry Creditors 1141.78 Sundry debtors 990.93
Advance from
customers
129.32 Cash bank
balance
815.83
Income received
in advance
3.04 Interest
accrued on
investment
10.27
Interest accrued
but not due on
loans
28.47 Loans advance 1058.94
Investors
education
protection fund
2.24
Other liabilities 287.64
Provision For:-
Taxation 2.61
Proposed divided -
Corporate tax on
dividend
0.04
Retirement
benefits
74.04
TOTAL 1683.00 3434.36
82
PROFITABILITY & DIVIDEND DISTRIBUTION
Profitability is a measure of efficiency and the
search for it provides on incentives to achieve efficiency
profitability also incentives to achieve efficiency
profitability also indicates public acceptance of the
product and shows that the firm can product and shows
that the firm can produce competitively.
The IR & IL has started to distribution dividend on e
share from 1977 the progress can be studied from the
following chart:-
YEAR DIVIDEND
2001-2002 33
2002-2003 37.5
2005-2006 41.75
2006-2007 51.32
83
IR & IL being a well dividend company serving with
excellent success under Birla mgt excellent competition
with turnover of 1990 to 2001 in credit 17.8 time
approbation and profit increased day by day very
progresses.
Distribution of Dividend:-
Company has issued share capital is 44.94 crores
each investor has invested in company with a view to
earn a reasonable rate of dividend:-
CHART DIVIDEND LINE
1997 67.5
1998 50
2002 33
2003 37.5
2006 41.75
2007 51.32
84
RIGHT ISSUE, RIGHT DEBENTURE ISSUE,
BONUS ISSUE
Right Issue:-
IR & IL issued share and debenture to the public,
this department deals with share and debentures by
dealing all the matters regarding to the same as a
application allotment, transfer, share certificate, board
meeting and general meeting etc.
Right debenture issue:-
Right issue means an issue, which gives the right to
share holder to purchase a share on a fixed proportion
prior to other.
In 1986, 42500 debentures were offered to resident
equity share holder on the basic on right debentures per
every two equity share holder its aim was to contribute
towards long term working condition needs before 6
years. Company issued convertible and non-convertible
debentures to receive for cash, so debenture party
returned.
85
Bonus Issue:-
Bonus was issued in 1980 in the prop oration of 1:4
to existing share holder; during the year under review,
company issued 2336979 crores equity share as bonus
shares on 15th October, 2003 in the record of one bonus
share to every two share held on the record date fixed for
thus purpose, the bonus share are for full dividend for the
year under review, consequent to bonus issue, company
issued and paid up equity share capital stand enhanced
to 59.88 crores.
86
87
FUTURE PLAN
Development of carbonic softener for soft
finishing.
Development of yarn.
Development or improved design roller guide
for spinning machines.
Development of wastewater recycles system.
Development of microfilament yarn/trifocal
yarn and flat yarn etc.
88
89
ACHIEVEMENT
National safety award in 1934, 1987, 1990,
1991, 1994, 1998 & 1999.
National safety award for the longest accident
free period in 1987, 1989, 1991.
Staff safety award received for award during
1987 & 1993.
First Rayon manufacturing 10-meter rayon to
get ISO 14001 & ISO 9002 certificate.
National energy conversion for VFY from
ministry of textile.
90
91
CONCLUSION
IR & IL is a heavy industries having sound facility of
manpower, finance, machineries and organization.
Company has well established marketing and
personnel department and the financial condition.
At least, I would like to give my best wishes to the
company and company may have splendid success and
glorious achievement.
92
93
BIBLIOGRAPHY
PRODUCTION MANAGEMENT:-
CHUNAWALA PATEL
FINANCE MANAGEMENT:-
KHAN AND JAIN
PERSONNEL MANAGEMENT:-
C. B. MEMORIA
ANNUAL REPORTS:-
2006-2007
WEB-SITE:-
www.adityabirla.com
www.adityabirlanuvo.co.in
94
