Dealers level of satisfaction OCL India Cement Internship project report 2012-13

SUMMER INTERNSHIP REPORTON“DEALER’S LEVEL OFSATISFACTION ON OCL CEMENT”ATOCL INDIA LTD.BhubneshwarOdishaFOR THE PARTIAL FULFILLMENT OF

“MASTERS IN BUSINESS ADMINISTRATION”2011-2013

SUBMITTED TO, SUBMITTED BY,Mr. S.Sikdar Sourav Dash

(Dy. Manager Sales/C)

SCHOOL OF MANAGEMENTNATIONAL INSTITUTE OF TECHNOLOGY

ROURKELAWebsite:nitrkl.ac.in

DEALER’S LEVEL OF SATISFACITION ON KONARK CEMENT

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CERTIFICATE

This is to certify that Project Report title “DEALER’S LEVEL OFSATISFACTION ON OCL CEMENT” is a bonafide work carried out bySourav Dash of MBA of National Institute of Technology, Rourkela forfulfilment of MBA degree of university. He has worked under our guidance anddirection.

Signature of Guide Signature of mentor

Date: Date:

Place: Place:


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ACKNOWLEDGEMENT

Words are indeed inadequate to convey my deep sense of gratitude to all those whohave helped me in completing my summer project to the best of my ability. Being a partof this project has certainly been a unique and a very productive experience on my part.I am really thankful to Mr. S. Sikdar (Dy. Manager Sales/C) for making all kinds ofarrangements to carry the project successfully and for guiding and helping me to solveall kinds of quarries regarding the project work. His systematic way of working and incomparable guidance has inspired the pace of the project to a great extent.I would also like to thank my mentor and project – coordinator Mr. Rajeev Panda(Asst.Professor), for assigning me a project of such a great learning experience andacquainting me with real life project and appraisal.I express my deep sense of gratitude to Dr. S.K Rath (H.O.D School of Management,

National Institute of Technology, Rourkela) for his valuable guidance during myreport work .I also grateful to all Faculty members of my college.

SOURAV DASHSchool of ManagementNational Institute of TechnologyRourkela


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ABSTRACT

This project report entitled:” A study on dealer level of satisfaction on Konark cement”Is intended to determine the dealer satisfaction, Products awareness, fluctuation ofdemand and needs and wants of the dealers.Primarily the well defined objectives one framed according to the study. Thenquestionnaire is prepared based on the defined objectives. The prepared questionnaireis used to get way of personal interview from the dealers.The response given by the customers are analyzed and interpret using different types ofstatistical tools such as percentage analysis, weighted average method and byfrequency.From the analysis some general findings one raised and that one more related with theframed objectives for this study. According to the findings the suggestion are given andthe conclusions one also based on the findings which will be more helpful for theorganizations


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TABLE OF CONTENTS

LIST OF TABLESLIST OF CHARTS

CHAPTER TITLE PAGE NO.

I INTRODUCTION ABOUT CEMENTINDUSRTY IN INDIA

9-33

II COMPANY PROFILE 35-45

III OBJECTIVE & RESEARCHMETHODOLOGY

47-51

IV DATA ANALYSIS ANDINTERPRETATION

53-64

V FINDINGS,SUGGESTIONS &LIMITATIONS

66-67

VI SWOT ANALYSIS 69

VII CONCLUSION 71

VIII SCOPE & LIMITATIONS FOR FUTHERSTUDY

73

ANNEXURES1- REGIONAL DEMEND AND SUPPLY BALANCE2- LIST OF COMPANIES WITH ICRA-RATINGS3- BIBLOGRAPHY4- QUESTIONNARIES


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LIST OF TABLESTABLES TITLES PAGE NO.

1 Growth in cement demand 82 Cement supply-demand indicator. 93 Cement supply-demand indicator all India 124 Share of capacity of top players in the Northern Region 145 Demand-supply indicators for Northern Region 146 Share of capacity of top players in the Eastern Region 167 Demand-supply indicators for Eastern Region 168 Demand-supply indicators for Northern+Eastern Region 179 Available capacity for Northern+Eastern Region 18

10 Share of capacity of top players in the Wertern Region 1911 Demand-supply indicators for Western Region 2012 Share of capacity of top players in the Southern Region 2013 Demand-supply indicators for Southern Region 2114 Demand-supply indicators for Southern+Western Region 2115 List of companies with IACR ratings 2216 Nature of shop 4817 Quantity of cement sold by the dealers per month 4818 Since how many years you are in this business 4819 Highest selling brand from counter (customer pull)? 4920 Factors affecting highest selling brand. 4921 Recommendation by dealer 5122 Personal visits by marketing peoples 5123 Credit enjoyed by dealers 5224 Profit margin 5225 Availability throughout the year 5326 Effective promotional activities. 5427 Effective method of sales promotion 5428 Quality and packaging of brands 5629 Quick delivery system 5730 Brands which satisfy most on damage claim

settlement57

31 Small quantity supply directly to customers faster 5832 The incentive schemes which satisfy dealer. 5833 Test certificates and vouchers for customers

about different grades and quality59

34 effective technical services 5935 After sale service satisfy the dealer most? 60


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LIST OF CHARTSCHARTS TITLES PAGE NO.

1 Growth in cement consumption in major states 92 Trend in cement capacity utilisation 103 All India Quarterly capacity addition 114 Region-wise capacity Distribution 115 All India Yearly capacity addition 116 All India effective capacity addition 117 Monthly capacity utilisation trend 128 Inventory level as % of monthly dispatch 129 Overall Demand-Supply Balance at 10% demand Growth 13

10 Overall Demand-Supply Balance at 8% demand Growth 1311 Share of OPC in product mix(2001-09) 1412 Share of OPC in product mix(2008-09) 1413 Price trend in key northern market 1614 Capacity utilisation in northern region 1615 Price trend in key Eastern market 1716 Capacity utilisation in Eastern region 1717 Capacity utilisation for Northern+Eastern region 1818 Price trend in key Western market 2019 Capacity utilisation in Western region 2020 Price trend in key Southern market 2221 Capacity utilisation in Southern region 2222 Nature of shop 4923 Quantity of cement sold by the dealers per month 4924 Since how many years you are in this business 4925 Highest selling brand from counter (customer pull)? 50

26,27,28,29,30 Factors affecting highest selling brand. 50,5131 Recommendation by dealer 5232 Personal visits by marketing peoples 5233 Credit enjoyed by dealers 5334 Profit margin 5335 Availability throughout the year 5436 Effective promotional activities. 55

37,38,39,40,41,42,43 Effective method of sales promotion 55,5644 Quality and packaging of brands 5645 Quick delivery system 5746 Brands which satisfy most on damage claim

settlement57

47 Small quantity supply directly to customers faster 5848 The incentive schemes which satisfy dealer. 5849 Test certificates and vouchers for customers

about different grades and quality59

50 effective technical services 5951 After sale service satisfy the dealer most? 60


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CHAPTERI


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OVERVIEW OF THE CEMENT INDUSTRY1.1 INDIAN CEMENT INDUSTRYCement Industry originated in India when the first plant commenced production in1914 at Porbandar, Gujarat. The industry has since been growing at a steady pace, but inthe initial stage, particularly during the period before Independence, the growth hadbeen very slow. Since indigenous production was not sufficient to meet the entiredomestic demand, the Government had to control its price and distribution statutorily.Large quantities of cement had to be imported for meeting the deficit. The industry waspartially decontrolled in 1982 and this gave impetus to its pace of growth. Installedcapacity increased to more than double from 27 million tons in 1980-81 to 62 milliontons in 1989-90.The cement industry responded positively to liberalization policy and the Governmentdecontrolled the industry fully on 1st March 1989. From 1991 onwards cement industrygot the status of a priority industry in schedule III of the industry policy statement,which made it eligible for automatic approval for foreign investment up to 51% and alsofor technical collaboration on normal terms of payment of royalty.After the globalization and liberalization of Indian economy, the cement industry hasbeen growing rapidly at an average rate of 9 percent. The country is now the secondlargest producer of cement in the world next only to China with a total capacity of217.80 million tonnes. Additionally, in the last two decades, the industry has undergonerapid technological up gradation and growth, and now, some of the cement plants inIndia are comparable to the world’s best operating plants in all respects.Till a few years ago India was importing cement from other countries, as the productioncould not meet the demand for the whole country. Now the tables have turned as Indiahas started exporting large quantities of cement and clinker to Bangladesh, Nepal, SriLanka, Maldives, Mauritius, Africa, Seychelles, Burma, UAE, and Singapore etc.India is today the second largest producer of cement in world with an installed capacityof close to 217.80 million tons per year. 95 % is consumed domestically and only 5% isexported. Demand is growing at more than 10 % per annum. More than 90 % ofproduction comes from large cement plants. There are a total of 146 large and morethan 350 small cement manufacturing units in the country. More than 80% of thecement manufacturing units use modern environment friendly “dry” process.In the cement industry there are two sectors – one consisting of large plants and theother consisting of mini cement plants. A factory with an installed capacity exceeding2,97,000 tonnes per annum (900 tons per day) is a large plant and with capacity up toand including 2,97,000 tons is a mini cement plant. At present, there are 146 largeplants and about 365 mini cement plants. Since mini cement plants are scattered allover the country with a number of associations representing different types ofprocesses, sizes etc. And some of them are even tiny units; it has not been possible toobtain correct data of this sector. The present installed capacity of large plants is 217.80million tons and the estimated capacity of mini cement plants is 11.8 million tons.


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1.2 OVERVIEW OF PERFORMANCE OF CEMENT INDUSTRYThe Indian cement Industry not only ranks second in the production of cement in theworld but also produces quality cement, which meets global standards. However, theindustry faces a number of constraints in terms of high cost of power, high railwaytariff; high incidence of state and central levies and duties; lack of private and publicinvestment in infrastructure projects; poor quality coal and inadequate growth ofrelated infrastructure like sea and rail transport, ports and bulk terminals. In order toutilize excess capacity available with the cement industry, the government hasidentified the following thrust areas for increasing demand for cement:· Housing development programmers & Promotion of concrete highways and roads;· Use of ready-mix concrete in large infrastructure projects;· Construction of concrete roads in rural areas under Prime Ministers Gram SadakYojana.In India, the different types of cement are manufactured using dry, semi-dry, and wetprocesses. In the production of Clinker Cement, a lot of energy is required. It isproduced by using materials such as limestone, iron oxides, aluminum, and siliconoxides. Among the different kinds of cement produced in India, Portland PozzolanaCement, Ordinary Portland Cement, and Portland Blast Furnace Slag Cement are themost important because they account for around 99% of the total cement production inIndia.The types of cement in India have increased over the years with the advancement inresearch, development, and technology. The Indian cement industry is witnessing aboom as a result of which the production of different kinds of cement in India has alsoincreased.By a fair estimate, there are around 11 different types of cement that are beingproduced in India. The production of all these cement varieties is according to thespecifications of the cement.1.3 CURRENT SCENARIOThe Indian cement industry is the second largest producer of quality cement. IndianCement Industry is engaged in the production of several varieties of cement such asOrdinary Portland Cement (OPC), Portland Pozzolana Cement (PPC), Portland BlastFurnace Slag Cement (PBFS), Oil Well Cement, Rapid Hardening Portland Cement,Sulphate Resisting Portland Cement, White Cement, etc. They are produced strictly asper the Bureau of Indian Standards (BIS) specifications and their quality is comparablewith the best in the world.The industry occupies an important place in the national economy because of its stronglinkages to other sectors such as construction, transportation, coal and power. Thecement industry is also one of the major contributors to the exchequer by way ofindirect taxes.


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1.4 FACTS OF INDIAN CEMENT INDUSTRY (1982 – 2009)

The Industry recorded an exponential growth with the introduction of partialdecontrol in 1982 culminating in total decontrol in 1989. The capacity, which was 29 Mn.t in 1981-82, rose to 219 Mn.t at the end of FY09. While it took 8 decades to reach the 1st 100 Mn.t capacity, the 2 nd 100 Mn.t wasadded in just 10 years. India ranks second in world cement producing countries. It contributes to environmental cleanliness by consuming hazardous wastes likeFly Ash (around 30 Mn.t) from thermal power plants and the entire 8 Mn.t of slagproduced by steel manufacturing units. As a part of Corporate Social Responsibility (CSR), the cement Industry employsaround 0.1 million people and takes care of the social needs not only of theemployees but also adopts several villages around the factories providing freedrinking water, electricity, medical and educational facilities. The cement Industry produces a variety of cement to suit a host of applicationsmatching the world's best in quality. Exports Cement/Clinker to around 30 countries across the globe and earnsprecious foreign exchange.

1.5 Statistics

Figures in Million TonnesDescription January2012 December2011 January2012 2011-2012 2010-2011(Apr-Jan)CementProduction 16.47 15.72 14.82 145.00 137.16CementDespatches 16.27 15.76 14.73 143.96 136.181.6 KEY DRIVERS OF THE CEMENT

Buoyant real estate market Increase in infrastructure spending Various governmental programmes like National Rural Employment Guarantee Low-cost housing in urban and rural areas under schemes like Jawaharlal NehruNational Urban Renewal Mission (JNNURM) and Indira Aawas Yojana

1.7 TECHNOLOGICAL ADVANCEMENTSModernization and technology up-gradation is a continuous process for any growingindustry and is equally true for the cement industry. At present, the quality of cementand building materials produced in India meets international standards andbenchmarks and can compete in international markets. The productivity parametersare now nearing the theoretical bests and alternate means. Substantial technological


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improvements have been brought about and today, the industry can legitimately beproud of its state-of-the-art technology and processes incorporated in most of itscement plants. This technology up gradation is resulting in increased capacity,reduction in cost of production of cement.1.8 MAJOR PLAYERS ON CEMENT INDUSTRY

Ultratech Cement Century Cements Madras Cements ACC Gujarat Ambuja Cement Limited Grasim Industries India Cements Limited Jaiprakash Associates and JK Cements. Holcim Lafarge Heidelberg Cemex OCL Cement

1.9 FORGEIN DIRECT INVESTMENTSThe cement sector has been gradually liberalized. 100 per cent FDI is permitted in thecement industry.1.9.1 Future OutlookGrowth in domestic cement demand is expected to remain strong, given the revival inthe housing markets, continued Government spending on the rural sector, and thegradual increase in the number of infrastructure projects being executed by the privatesector. Thus, the trend in demand growth seen during the last five years is expected tocontinue over the medium term. Also, with Government targeting an over 8% GDPgrowth rate, cement demand should grow at 8-10% over the next few years.The industry may be expected to add another 130-135 million tonnes of cementcapacity in phases during the period 2009-10 to 2012-13.


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1.9.2 Strong consumption growth driven by secular growth across sectorThe Indian cement industry reported a strong CAGR of 9.3% during the period 2004-05to 2008-09. Even during the economic slowdown in 2008-09, growth in cement demandremained at a healthy 8.4%. In the current fiscal (2009-10) cement consumption hasshot up, reporting, on an average, 12.5% growth in consumption during the first eightmonths with the growth being aided by strong infrastructure spending, especially fromthe govt sector. The trends in all-India consumption and the growth in consumption inthe major cement-consuming States over the last five years are presented in Table 1 andChart 1.

The increase in cement demand over the last few years has been driven by a buoyant realestate market (the dip in 2008-09 notwithstanding) and an increase in infrastructurespending. Further, various governmental programmes like National Rural EmploymentGuarantee and low-cost housing in urban and rural areas under schemes like JawaharlalNehru National Urban Renewal Mission (JNNURM) and Indira Aawas Yojana have alsoprovided a fillip to rural demand for housing. Within the country, the top five States interms of cement consumption, viz. Maharashtra, Andhra Pradesh (AP), Uttar Pradesh(UP), Tamil Nadu (TN) and Gujarat, accounted for almost 50% of the total domesticconsumption of cement during 2008-09. This is largely a factor of the population levelsin these States as well as the development activities being undertaken there. Withinthese high consuming States, AP and TN reported very high growth rates during the lastfive years, mainly because of the real estate buoyancy and increased Governmentspending on infrastructure. Haryana, the 11th largest cement consuming State in thecountry (according to 2008-09 consumption), posted a high consumption growth rate ofmore than 14% over the last five years, largely on the strength of the upturn in real


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estate. Going forward, ICRA expects growth in domestic cement demand to remainstrong, given the revival in the housing markets, continued Government spending on therural sector, and the gradual increase in the number of infrastructure projects beingexecuted by the private sector. Thus, the trend in demand growth seen during the lastfive years is expected to continue over the medium term. Also, with Governmenttargeting an over 8% GDP growth rate, cement demand should grow at 8-10% over thenext few years.1.9.3 Capacity additions to impact utilisation levels over the medium termThe period 2002-03 to 2006-07 saw strong demand growth along with very slowcapacity addition, the latter being an outcome of the weak financial position that cementcompanies had got into because of the significant surpluses in the system during 2000-01 to 2003-04. With capacity addition being limited and demand continuing to grow,capacity utilisation levels in the cement industry touched almost 100% in 2006-07 andsupply constraints surfaced. To improve domestic supply, Government resorted to anexport ban in April 2008 and also allowed duty-free imports of cement. With supplyconstraints cropping up, the pricing power and profitability of cement companiesimproved significantly during 2006-09.


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Almost all the major players in the Indian cement industry announced capacityexpansion programmes 2005-06 onwards, being encouraged by the improvingeconomic outlook, buoyant demand conditions, strong industry profitability, andanticipated supply constraints. Such announcements continued all the way till mid-2008-09 when the economic conditions started deteriorating. The expansion projectshave now started coming on stream (the gestation period being of 24-36 months), andas in March 2009, the country had an installed capacity of around 209 million tonnes, ofwhich around 43 million tonnes were added during the last two years alone. A part ofthe capacity addition over the last two years also came from debottlenecking of existingcapacities and increase in the share of blended cement. According to ICRA’s estimates,the industry may be expected to add another 130-135 million tonnes of cement capacityin phases over the next four years, that is, during the period 2009-10 to 2012-13. Of theannounced capacity additions, region-wise, SR is expected to account for almost 42%(highest share) of the additions proposed, followed by NR (around 29%). Capacityaddition in WR and ER, which is expected to be 17% and 12% of the total announcedadditions respectively, has been constrained primarily by the lack of availability oflimestone reserves in these regions. Of the total capacities announced, almost 63% arescheduled for commissioning in 2009-10 and 2010-11, which means capacity additions,would get bunched up during this period. Going forward, ICRA expects the pace ofcapacity addition to slow down in 2011-12, which should stabilise capacity utilisationlevels that year onwards. However, should cement manufacturers continue withcapacity additions, recovery in utilisation may get delayed. Charts 3 to 6 bring out thedistribution of the scheduled capacity additions over various time periods and regions,taking into account the announcements made by the various industry players so far.


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As Charts 5 and 6 show, a significant part of the announced capacities is scheduled forcompletion in 2009-10 and 2010-11. The impact of the resulting increase in supply hasalready started showing up in the capacity utilisation levels, which declined to around80% in November 2009 (83% for April-November 2009) from around 90% during2008-09 and 96% during 2007-08. The inventory in the system (cement plus clinker)has also seen a build-up (Chart 8), rising to 74% of monthly dispatches in November2009 from 36% in March 2009.

1.9.4 With capacity utilisation declining, prices start softening since Q3, 2009-10Cement prices showed a steady hardening trend from 2003-04 up to H1 2009-10 withthe supply-demand scenario remaining tight (refer Annexure I for the region-wise pricetrends). Although capacity substantially outstripped demand by 2008-09 itself, this wasnot reflected in the prices during 2008-09 and H1, 2009-10 because much of thesecapacities were still in the stabilisation phase with the result that the effective capacitywas substantially lower and the capacity utilisation level higher than what the figures inTable 2 indicate. However with many of these capacities being fully operational now,pricing pressures have started building since Q3, 2009-10. The decline in prices hasbeen the most severe in SR, especially AP (chart 20, annexure I).1.9.5 Significant oversupplies seen in the medium term, but supply-demandbalance likely to show considerable variations across regionsICRA has projected the cement supply-demand scenario for 2009-13 on the basis ofcompany announcements for capacity additions, using two different assumptions onannual demand growth: 8% and 10%. The region-wise projections have been presentedin Annexure I. Table 3 presents the overall demand-supply balance for the country as awhole, using the estimates of supply and demand growth that ICRA has worked out.


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While ICRA expects the overall capacity utilisation level to fall below 80% even underoptimistic assumptions on demand growth (Chart 9), the actual capacity utilisation,price corrections, and the impact of the same on profitability would also be influencedby regional supply-demand balances (refer Annexure I for details). Also, any delay,deferment or phasing out of capacities, were that to happen, would lower the supply-side pressures as envisaged in Chart 9. Another variable that could impact the demand-supply scenario is the shift in the industry’s product mix. Over the last few years, theIndian cement industry has successfully shifted its product mix towards PozzalanaPortland Cement (PPC), with the result that the share of OPC has shrunk, declining from63% in 2000-01 to 25% in 2008-09 (Chart 11). The shift in product mix has also beennecessitated by the tight supply-demand scenario (implying limitations in clinkeravailability). Greater production of PPC provides for optimisation of capacity utilisation,as clinker capacity is often the primary constraint in cement production. Thus the shifttowards PPC led to high capacity utilisation for the industry during the period 2005-06to 2007-08 as compared with the 80% or so seen during much of the late 1990s andearly 2000s. The manufacturing cost of OPC is generally higher by Rs. 200-300/tonnethan that of PPC because PPC consumes blending material, which is usually cheaperthan clinker. Further, as fly ash is finely ground, the grinding cost (mainly the cost ofpower) is lower for PPC than for OPC. However, while the cost of manufacturing OPC


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tends to be higher versus PPC, an analysis of past cement prices by ICRA shows that OPCprices also tend to be higher than PPC prices, thereby largely offsetting the highermanufacturing cost of OPC.ICRA has witnessed a slight reversal of this long term trend during the past few months,whereby the share of OPC in the industry’s product mix has increased from 24% in April

2008 to 31% in November 2009 (refer Chart 12). The change in the long-term trend canbe is attributable to the industry’s strategic shift to OPC, which is aimed at curtailingsupply-side pressures. Further, as OPC tends to set faster thereby expeditingconstruction, the higher cost of OPC may be acceptable to most buyers. In ICRA’s view,while the trend of shifting to OPC may raise the cost of production and lower capacityutilisation for the industry, it may also help in reducing supply-side pressures, which inturn could protect prices. A shift in product mix, along with a significant correction inprices, may however have an adverse effect on profitability, as it will not only raise thecost of production, but also pull down capacity utilisation.Given that competition is largely regional in the cement market, regional demand-supply dynamics play a crucial role in determining price trends. Additionally, sincelarge inter-regional transfers of cement take place between NR and ER and between SRand WR, ICRA also takes into account the demand-supply dynamics prevailing in theseregions combined to ascertain the projected level of capacity utilisation. The followingdetails are presented in Annexure I.1.9.6 Summarised Regional Demand Supply BalanceFor the purpose of regional demand-supply balances, ICRA divides the country into fourregions: NR, ER, WR and SR. Uttar Pradesh and Madhya Pradesh, which are classifiedunder the central region by CMA, are considered to a part of the Northern region,whereas Goa, which is considered a part of the Sothern region by CMA, is considered apart of the Western region by ICRA.


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1.10 ANNEXURE I: REGIONAL DEMEND AND SUPPLY BALANCE

1.10.1 Northern RegionStates included in NR: Uttarakhand, Haryana, Punjab, Rajasthan, Himachal Pradesh,Chandigarh, Delhi, Jammu and Kashmir, UP, MP, and Chhattisgarh. NR is the largestcement consuming region in the country and accounted for almost 37% of the all-Indiaconsumption and 42% of the available capacity during 2008-09. Within NR, UP,Rajasthan, MP and Haryana are the largest cement consuming States, and accounted for75% of the regional consumption in 2008-09. Over the last five years, cement demandin NR reported a CAGR of 8.7%, as against the all-India average of 9.3%. Within NR,demand was driven by Rajasthan and Haryana, which reported CAGRs of 10.7% and14.3%, respectively. Cement demand in NR is being driven by the CommonwealthGames in Delhi, the Delhi Metro Rail project, construction of roads, airports, and hydro-power plants, and the real estate boom. The major players in NR include ACC + AmbujaCement (Part of the Holcim Group), Gasim + Ultratech (part of the A V Birla Group),Jaypee Cement, Shree Cement, the J K Group, Binani Cement, Century Textiles, and BirlaCorporation. Within the region, the top five players/groups accounted for around 70%of the total operating capacity during 2008-09.


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As against an available capacity of 85 MTPA during 2008-09, the capacity additionexpected in NR over the next four years is around 38 MTPA, which would increase thetotal availability in the region to 123 MTPA by the end of 2012-13. Assuming anoptimistic growth rate of 10%, capacity utilisation in NR is expected to declinemarginally from 77% in 2008-09 to around 71% in 2010-11, but recovers thereafter,provided no fresh capacity addition is done by the industry.While cement prices in some markets of NR such as Chandigarh and Delhi havewitnessed a correction of Rs. 10-15/bag over the past few months, large corrections arenot envisaged in the future and price volatility is also likely to be lower. This pricing isalso expected to be aided by the stable shares of the capacities attributable to top fiveplayers in the region. The top five players in NR are expected to continue dominatingthe market with a cumulative market share of around 70% in the medium term.However, pricing pressures may arise in future in case the currently strong demandgrowth is not sustained and ER reports lower deficits than anticipated.1.10.2 Eastern RegionStates included in ER: Assam, Meghalaya, Bihar, Jharkhand, Orissa, West Bengal (WB),Tripura, Manipur, Nagaland, Arunachal Pradesh, and Mizoram. ER is the least cementconsuming region in the country and accounted for about 14% of the all-Indiaconsumption and only 9% of the available capacity during 2008-09. In the absence ofadequate limestone reserves in most eastern States, the region has remained a netimporter of cement, relying most on NR, especially Chhattisgarh, for cement imports.Within ER, WB, Bihar and Orissa are the largest cement consuming States andaccounted for 76% of the total regional consumption in 2008-09. Over the last fiveyears, cement demand in ER reported a CAGR of 8.4% as against the all-India average of9.3%. Within ER, the demand was driven by Bihar and Orissa, which reported CAGRs of10.3% and 10.1%, respectively. Demand in ER has been driven largely by industrialactivity, given the abundance of natural resources in the region, as well as by theincrease in governmental focus on further development of the North-Eastern States. Themajor players in the region include ACC + Ambuja Cement (Part of Holcim Group),Lafrage, OCL India, Gasim + Ultratech (part of A V Birla Group) and Birla Corporation.


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Within the region, the top five players/groups accounted for around 84% of the totaloperating capacity during 2008-09.As against an available capacity of around 17.5 MTPA during 2008-09, the capacityaddition expected in ER over the next four years is around 16 MTPA, which would

increase the total availability in the region to around 34 MTPA by the end of 2012-13.

Since the region has remained a net importer of cement from NR, such a significantincrease in supply would reduce ER’s import dependence over the medium term andlower its deficit levels significantly.Despite a deficit situation in ER, cement prices have seen a decline of around Rs. 10/bagin the Kolkata market over the last few months, as pricing in the region is alsoinfluenced by the demand-supply balance in NR. While ER is expected to remain acement-deficit region in the long run, the extent of consolidation here is expected toweaken as new players enter the industry. This is expected to lead to a decline in thecapacity share of the five leading players in ER from around 84% in 2008-09 to 71% in2012-13. A decline in the extent of consolidation and an overall increase in surplus inNR may cause pricing pressures to arise in ER, although the same is not likely to be


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significant. Further, players in ER would continue to benefit from the region’s freightcost advantage as compared with players in NR for exporting cement to the region. As aresult, players in ER are expected to continue benefiting from the region’s cement-deficit status.1.10.3 Northern plus Eastern RegionWith NR historically being a cement-surplus region and ER traditionally a cement-deficit one, the extent of inter-regional cement transfer from NR to ER is considerable. Asignificant quantity of cement is exported from States such as Chhattisgarh and MP(eastern part) to parts of Orissa, West Bengal and even some North-Eastern States. As aresult, the overall supply-demand balance of NR + ER as a whole impact prices in thesetwo regions. Any significant surplus in NR would lead to pricing pressures in ER, whileany reduction in deficits in ER would create pricing pressures in NR as well as ER.According to ICRA’s estimates, the overall capacity utilisation levels for NR and ER as awhole are not expected to decline below 80% or so in the near to medium term from the87% levels reported in 2008-09.

Further, the extent of consolidation in the industry for NR plus ER is not likely todeteriorate significantly, as the top five players here are expected to hold over 70% ofthe available capacity in the region post-completion of the announced expansions.


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1.10.4 Western RegionStates included in WR: Gujarat, Maharashtra, and Goa.WR accounted for almost 19% of the total domestic consumption of cement and 15% ofthe available cement capacity in the country during 2008-09. The largest cementconsumer within WR, Maharashtra, which alone was responsible for almost 60% of theregional consumption in 2008-09, is also the largest cement consuming State in thecountry, and accounted for 12.3% of the total domestic cement consumption in 2008-09. However, Maharashtra lacks significant limestone deposits, and the demand islargely met by the only limestone cluster in the State, that is, the Chandrapur cluster, aswell as by imports from States in SR, viz. North AP and North Karnataka. The state ofGujarat in WR is largely self sufficient for its cement requirements and moreover, givenits advantage of having cement plants located near the sea, it is also able to export thesurplus to other countries in the Middle East region. Over the last five years, cementdemand in WR reported a CAGR of 8.4% as against the national average of 9.3%. WithinWR, Maharashtra posted a CAGR of 8.3% in cement consumption, while Gujarat came upwith 9.1%. Given the significant levels of industrialisation in these States, the demandfor cement here is being driven mostly by industrial activities. Besides, cities likeMumbai, Pune and Nagpur, which are also areas of increasing focus for service sectorentities, have contributed significantly to the pickup in demand. Further, the real estateboom in Mumbai, Pune, Nagpur and Ahmadabad has led to the proliferation of shoppingmalls, commercial complexes and housing projects, all of them reinforcing the demandtrend. The major players in the region include ACC + Ambuja Cement (Part of HolcimGroup) and Gasim + Ultratech (part of A V Birla Group), which together held almost70% of the available capacity in WR in 2008-09. The top five players/groups accountedfor around 92% of the total available capacity in the region in 2008-09, highlighting thefact that the level of consolidation is the highest in WR among all regions.As against an available capacity of around 31 MTPA in 2008-09, the capacity additionexpected in WR over the next four years is around 23 MTPA, which would increase thetotal availability in the region to 56 MTPA by the end of 2012-13. With capacity additionduring the last five years having been limited (around 2 MTPA), WR turned into acement-deficit region during 2007-09. Going forward, given the significant capacityplanned, cement availability is expected to improve within WR, which however couldbring down the capacity utilisation levels to around 90% in the medium term.


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Despite capacity utilisation levels remaining close to 100% in WR during 2009-10 so far(104% during April-November 2009), cement prices in one of the key markets of theregion, Mumbai, have declined by almost Rs. 20/bag over the past few months. Thereason for this is the sharp decline in cement prices in SR during this period. Since SRhas historically been a cement-surplus region (because of its large limestone clusters), itexports its surplus to WR, with the result that cement prices in WR are influencedsignificantly by the demand-supply balance in SR. Over the past few months, some of thekey markets in SR have reported a significant drop of Rs. 50-60/bag in cement pricesand this has led to pricing pressures in WR. Following completion of the announcedexpansions in WR, the level of consolidation in this region is likely to moderate with thetop five players accounting for around 70% of the available capacities as against 92%now. Decline in consolidation levels along with the likely decline in capacity utilisationlevels in WR and the expected surplus in SR could lead to cement prices coming underpressure in WR over the near to medium term.

1.10.5 Southern RegionStates included in SR: Andhra Pradesh (AP), Tamil Nadu (TN), Karnataka, Kerala,Pondicherry, and Andaman & Nicobar. SR accounted for 30% of the total domesticconsumption of cement in 2008-09. It is the second largest cement consuming region inthe country after by NR. Holding 34% of the domestic available capacity during 2008-09, SR is also the second largest production base for cement in India after NR. Within SR,AP reported the highest CAGR of 17.5% in cement consumption over the last five yearswith the State Government stepping up infrastructure spending, mainly on irrigationprojects. The figure is the highest among all States in the country for the periodconcerned. With cement consumption growing at a brisk pace in AP and TN (the largestconsuming state in SR) reporting an 11.8% CAGR in consumption over the last fiveyears, SR posted a CAGR of 11.3% over the same period, which is not only higher thanthe national average but also the highest among all regions in the country. SR is also


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among the most fragmented regions in terms of capacity concentration in India. The topfive players in SR held around 55% of the available capacity in the region during 2008-09, which is the lowest among all regions in the country. The largest player, IndiaCement, held 15% of the available capacity, which again is the lowest for the largestplayer in any region. The other major players in SR include Grasim + Ultratech (part of AV Birla Group), Madras Cement, ACC + Ambuja Cement (Part of Holcim Group), andKesoram Industries.

Given the abundant limestone reserves in SR (of the seven major limestone clusters inIndia, four are in SR), the region has historically been cement-surplus and an exporterto WR. With demand growing at 11.3% during the last five years, capacity utilisation inSR improved from around 67% in 2004-05 to almost 80% in 2008-09. Encouraged bythe buoyancy in demand, cement companies in the region have drawn up significantexpansion plans and of the total expected addition of 133 MTPA (all-India) over the nextfour years, almost 42% is expected to come up in SR. As against an available capacity of54 MTPA in 2008-09, the capacity addition expected in SR over the next four years is 56MTPA. With that, the utilisation levels may be expected to decline to around 60% in themedium term. Further, the level of fragmentation in SR is also expected to increasefurther, with the capacity concentration (top five players) likely to decline to around45% in 2012-13 from 55% in 2008-09. Low capacity utilisation along with greaterfragmentation may be expected to lead to severe price pressures in SR in the mediumterm.Pricing pressures have already come into play in SR as is evident from the price trendsin a few key markets in the region; the reason for this is the decline in capacityutilisation levels (63% during April-November 2009). Cement prices in Hyderabadmarkets declined to almost Rs. 145/bag in November 2009 from the peak of Rs.225/bag in July 2009. Similarly, in Chennai markets cement prices declined by almostRs. 45/bag to Rs. 230/bag in last few months from the peak witnessed in June 2009.


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Going forward, with new capacities being commissioned, capacity utilisation levels aswell as cement prices in SR may be expected to remain under pressure and impactprices and capacity use in WR as well.1.10.6 Southern plus Western Region

Given the significant inter-regional transfer of cement from SR (especially North AP andNorth Karnataka) to the deficit areas in WR (especially Maharashtra), cement prices inthese two regions are influenced by the demand-supply balance in SR + WR as a whole.A deficit in WR generally leads to improved prices and capacity utilisation in SR, while asurplus in SR adversely impacts prices in WR. In ICRA’s assessment, the capacityutilisation level in SR + WR combined could decline significantly to around 70% in thenear to medium term from the 89% level reported in 2008-09. During April-November2009, capacity utilisation in SR + WR as a whole stood at 73%. The level of consolidationis also likely to weaken in both SR and WR, which along with the expected decline incapacity utilisation could increase the intensity of competition and pricing pressuresfurther.


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1.11 ANNEXURE-II

TABLE-15


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1.12 DIFFERENT TYPES OF CEMENT PRODUCED IN INDIA

• Ordinary Portland cement (OPC):OPC, popularly known as grey cement, has 95 per cent clinker and 5 per cent Gypsumand other materials. It accounts for 70 per cent of the total consumption.• Portland Pozzolana Cement (PPC):PPC has 80 per cent clinker, 15 per cent pozzolana and 5 per cent gypsum and Accountsfor 18 per cent of the total cement consumption. It is manufactured because it uses flyash/burnt clay/coal waste as the main ingredient.• White Cement:White cement is basically OPC - clinker using fuel oil (instead of coal) with iron oxidecontent below 0.4 per cent to ensure whiteness. A special cooling technique is used inits production. It is used to enhance aesthetic value in tiles and flooring. White cement ismuch more expensive than grey cement.• Portland Blast Furnace Slag Cement (PBFSC):PBFSC consists of 45 per cent clinker, 50 per cent blast furnace slag and 5 per centgypsum and accounts for 10 per cent of the total cement consumed. It has a heat ofhydrations even lower than PPC and is generally used in the construction of dams andsimilar massive constructions.• Rapid Hardening Portland cement:Rapid Hardening Portland Cement is similar to OPC, except that it is ground much finer,so that on casting, the compressible strength increases rapidly.• Water Proof Cement:Water Proof Cement is similar to OPC, with a small portion of calcium stearate or non-sponifibale oil to impart waterproofing properties.Raw material required for Cement -

Limestone - extracted from own minesLaterite - readily available from nearby minesGypsum - purchased from Bikanar & NagorePet Coke - imported from foreign countriesFly Ash - brought from Kota Thermal Power Plant


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1.13 MANUFACTURING PROCESS OF CEMENT

1.14 PROCESS FLOW-DIAGRAM

LIMESTONE QUARRY CRUSHER LS STOCK PILE

RAW MILL RAW MEAL SILO P.H

KLIN COOLER

CEMENT MILL

CLINKER SILO

DESPATCH

PACKING PLANTCEMENT SILOS

LOGISTICS


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KLIN COOLER

CEMENT MILL

CLINKER SILO

DESPATCH


LOGISTICS


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KLIN COOLER

CEMENT MILL

CLINKER SILO

DESPATCH


LOGISTICS


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1.15 Manufacturing Process

Mining -Limestone is extracted from own mines, which are situated approx. 4 km. away fromplant. The mining of limestone is done in such a way so as to get 78% to 82% purelimestone.

Crushing -The extracted limestone is then transported to Jai crusher by dumpers. The limestoneis crushed into small pieces of approx. 16 to 25 mm. sizes.

Grinding -The crushed limestone along with latrine is feed into the Raw Mill for grinding. Theground material is called Raw Meal. It is than sent to the CF Silo.

Blending –In the Silo the Raw Material is blended to make the mixture uniform. From here thematerial is sent to the pre heaters.

Burning -In pre heaters, the mixture is heated at various temperatures at various stages. Thispreheated material is now fed into the kiln where it is heated at the temperature of1400-1500 degree where calcinations take place. Coal is used in the kiln to maintainthe temperature and finally clinker emerges out of it. This clinker is transportedthrough a conveyor into a storage Silo from where it taken out through vibratoryfeeders & fed into the open circuit cement grinding mill hoppers.

Grinding -The grinding of clinker with gypsum is done in cement mill. It is basically have wherethe grade of cement is controlled gypsum is added to increase the setting time of thecement. Then cement is than stored for some time.

Storage & packing -The cement is than conveyed to different cement storage silos according to theirgrades & from silos it is packed in LP bags by using electronic packaging machines.


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1.16 Method of Cement Storage

1. All windows and doors are closed and weather and Moisture must not affect to the cement.2. Distance of stacking bags should be 1 feet from wall and 2 feet from ceiling.3. In one stacking put only max. 15 cement bags.4. Use of cement bags FIFO system.5. Put the cement bags on wooden-plates and then cover by the plastics-sheets.

1.16.1 Storage of Cement

Storage Time Compressive Strength

Fresh 100%

3 Month 80%

6 Month 72%

12 Month 60%

24 Month 46%

1.17 TYPES OF CEMENTS

Cement

OPC PPC/PSC SRC

33 GRADES 43 GRADES 53 GRADES


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1.18 Standard requirement of various Raw Materials

Particular Standard requirement

OPC

Clinker - Limestone 92-93%

Iron Ore 02-03%

Gypsum 05%

PPC

Clinker - Limestone 70%

Iron Ore 05%

Gypsum 25%

1.19 DISTRIBUTION CHANNEL

Company has a very simple distribution channel for delivering the goods to theConsumer. It is combination of:

Company

Retailer Various Gov.Contacts

Stockiest Direct Selling tokey Customer


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1.20 ORGANIZATION CHART

PRESIDENT

WTD

ED(PRODUC

TION)

ED(HR)

ED(MARKE

TING)

ED(PUBLICRELATIONS)

ED(FINANC

E)

ED(COMMER

CIAL)

SALESHEAD

STATEHEAD

UNITHEAD

DISTRICTOFFICER

STRATEGICPLANNER &TRAINNING

BRANDING &ADVERTISEMENT

LOGISTICS


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CHAPTERII


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COMPANY PROFILE2.1 HISTORY OF OCLOCL is the flag ship company of ‘Dalmia Group’ of companies, set up and operating fromeastern India. The emergence of ‘Dalmia’ group on the industrial scene of India can betraced back to pre-independence era. Prominent among the early entrepreneurs wholaid the industrial foundation of India was Dalmia family. Established in 1932 with asugar factory, the Dalmia group gradually diversified into a broad spectrum of activitiesand were involved in many pioneering ventures. For reasons of operational efficiency,during fifties the Group split into separate entities.The origin of OCL was seeded in the time that signalled India's independence. A dreamunleashed. A blue print of growth was drawn. Endeavours to reconstruct economy setin. Indian industry woke up to the key challenge of self- reliance. Agriculture took a turnto modernity with construction of dams across the country. Against such a bubblingbackground Sjt. Jaidayalji Dalmia, an industrialist of farsighted vision set up a cementplant at Rajgangpur during 1950 - 51 at the request of government of Odisha tomanufacture super grade cement for use in the construction of Hirakud dam. The plantthat went on steam as Orissa cement limited during 1952 transformed itself into OCLIndia Limited during 1996 to better reflect its multifarious activities.OCL commissioned its Refractory plant in the year 1954, which today has grown intoone of the largest composite refractory plants in the country. It manufactures Silica,Basic Burnt Magnesia Carbon, Fireclay & High Alumina Bricks, Continuous Casting, SlideGate Refractory’s, Castables and Precast blocks Basic, Silica high alumina RammingMases/Mortars. OCL's Refractory division is the first Indian refractory manufacturer tohave secured the coveted ISO 9001 certification for all its refractory products. GloballyOCL is amongst the few select producers of coke oven silica bricks. Over years OCL hascollaborated with other world leaders in the respective fields and secured a place ofpride for itself.


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The company changed its name from Orissa Cement Ltd to OCL India Limited w.e.f.15.01.1996 to reflect its multifarious activities. During the year 2002 OCL set up itsSponge Iron unit at Rajgangpur State of Odisha, with an installed capacity of 1, 20,000MT P.A and later on developed Steel making facility by installing 3 sets of InductionFurnaces each of 250 MT/ day capacity and Steel Billet Casting Machine as a forwardintegration activity for the Sponge Iron plant & Pig Iron plant.In the year 2007 the Hon’ble High Courts of Odisha and Guahati have approved theScheme of Arrangement involving demerger of Steel Undertaking of the Company withOCL Iron and Steel Limited and Real Estate Undertaking of the Company with LandmarkProperty Development Company Limited (formerly “Konark Minerals Limited) andmerger with Dalmia Cement (Meghalaya) Limited.OCL's Cement Plant is one of the most modern dry process cement plants in India.‘Konark’ brand cement manufactured by OCL is the market leader in the State of Odishaand has emerged as a brand synonym of premium quality cement. Presently its installedcapacity for the factories located at Rajgangpur Cement Works & Kapilas Cement Worksis 5.35 Million Tonne per annum.OCL’s Refractory plant is situated at Rajgangpur with a total installed capacity of106400 MT per annum to produce the various types of refractoriness.Presently the equity shares of the Company having face value of Rs.2/-each are listed onNational Stock Exchange Limited and Bombay Stock Exchange Limited.OCL Refractoriness have world wide acceptance with exports to Americas as well asmany Euro-Africa- Asian Nations. A wide range of products manufactured at Rajgangpurand its associate company in China has given it the unique opportunity of perpetualcustomer base in Iron, Steel, and Copper, Precious Metal extraction, Aluminium andmany more refractory consuming processes.Presently the Group's activities include Cement, Refractory, Industrial Machines,Computer Software, Travel and Investments, with OCL India Ltd heading the list a theGroup's flagship company. While thus contributing its mite in helping India build andstrengthen infrastructure facilities and make advances in other related fields, the OCLGroup has been consistently building for itself an enviable reputation worldwide for thequality of its products and services. OCL is today a company of Indian roots with Globalreputation.


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2.2 MISSION & VISION2.2.1 MissionOCL is in the business of Cement and Refractoriness. These will continue to be ourprime business focus areasWe shall strive to improve our image in the eyes of all stakeholders - present andpotentialWe shall endeavour to build a vibrant and responsive organization with a team ofmotivated people driving for excellence, achievement and high performanceWe will create conditions and climate for empowerment through enhancement ofKnowledge, Attitudes and Skills with emphasis on multiskilling.2.2.2 VisionGrow profitably with commitment to customer satisfactionStrive for excellenceBe # 1 in chosen areasContinuously develop a committed team of peopleBuild good corporate image & high customer esteemEndeavour to serve society.2.3 AWARDS & RECOGNITION:

1. National award for energy efficiency in Indian Cement Industry.2. OCL Refractory Division has once again bagged the prestigious CAPAXIL-Ministryof Commerce, Government of India higher category “Special Export Award” forthe 4th consecutive year for 2008-09.3. During the celebration of 47th Annual Mines Safety Week, our Lanjiberna Mineshave been awarded with the following prizes amongst Limestone & DolomiteGroup.4. Ministry of Commerce & Industry issued STAR EXPORT HOUSE Certificateagainst our export performance during 2006-07, 07-08, 08-09 & 09-10.5. 15th All Orissa Quality Circle Convention organized by NALCO at BhubaneswarQuality circle “BASUNDHARA” from Concast finishing section of our Refractorydivision bagged Runners up Trophy (Silver Plaque). This is the first everdistinction for the team on its maiden external presentation.6. Quality Circle “GABESHANA” from Laboratory and “UTPADAN” from Productionmade excellent performance in the above forum.7. Quality circle “ANWESHAN” from Kiln & Utility department, refractory divisionbagged Silver award.8. Sri J N Tiwari, ED/R OCL’s refractory Chief and Executive Director, Sri J N Tiwariis felicitated with the coveted award by IRMA in a gala function held in Hotel TajBengal, Kolkata on 19th August 2010 for his devoted service in the developmentand application of refractories.


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2.4 CORPORATE SOCIAL RESPONSIBILITY:In its 60 years of untiring service to Nation, OCL has always given priority tocommunity development. In its endeavour to uplift the conditions of poor andhapless tribal’s of this locality, OCL has undertaken various developmental activitiesin peripheral areas of its plant at Rajgangpur and Captive Mines at Lanjiberna.

2.4.1 HealthOur aim is to provide free health care services to poor tribal people of this locality andcreate awareness among them about health and hygiene. In this direction we are: Providing free treatment and medicine to villagers in our dispensary atLanjiberna. Operating a Mobile Medical Unit for providing health care services to people attheir door step in Rajgangpur and Lanjiberna. A similar unit is also functioningin Kapilas Cement Works. Operating a charitable allopathic dispensary in village Sonakhan throughBharatiya Jana Seva Sansthan, New Delhi. Organising General Health Check-up Camps, Eye Camp, E & T Camp, DentalCamp etc in Rajgangpur and Lanjiberna every year. Renovated the hospital building of Govt. Hospital, Rajgangpur and improvedinfrastructure facilities like supply of water, construction of additional toilets,rooms etc. Organising awareness program on General Health and Hygiene, Malaria, Dengu,Chikungunia etc every year and distributing mosquito nets free of cost.

2.4.2 EducationOur aim is to improve standard of education, infrastructure facilities and other basicneeds of children in schools. In this direction we are: Constructing/ renovating buildings play grounds etc in schools. Arranging drinking water facilities by sinking bore well, laying pipe, installingpump etc. Providing furniture like bench, desk, table, chair etc and other study materials. Reimbursing salaries of teachers in some schools. Operating thirty “One Teacher Schools” called “EKALA VIDAYALAYA” in villagesin collaboration with “Friends of Tribal Society”.


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2.4.3 Drinking WaterWater supply facility in Rajgangpur and Lanjiberna area is extremely poor. The problembecomes more acute during summer. To address this problem we have: Sunk 118 Tube Wells in Rajgangpur & Lanjiberna in last 5 Years. Repaired 58 Tube wells & made them functional in last 5 Years. Dug/renovated Ponds, Ring Wells, constructed platform etc. Facilitated in implementing “Sajal Dhara Scheme” village Khatang and Dharuda. Made arrangement for supply of drinking water by sinking deep bore well, layingpipe etc in Ghoghar Temple and Sub Jail, Rajgangpur. Providing mines water for irrigation to four villages.

2.4.4 Community DevelopmentWe aim at creating/improving/maintaining infrastructure facilities in the area foruplifting the quality of life of people. We have: Constructed a 900 meter long concrete road in Rajgangpur. Constructed a three storied building, kitchen, Namasankirtan Mandap, toilet etcfor the inmates of ‘Kalpataru Ashram’, Lamloi, where poor orphan children areresiding. Renovated and maintaining ‘Theme Park’ at Sundargarh. The park depicts richcultural heritage of local tribals and is one of the best of its type in Odisha. Constructed thirteen Community Centres in villages. Also supplied furniture,utensils etc to these centres where villagers conduct community meetings andsocial/cultural functions. Provided electricity in four villages. Supplied street lights in Rajgangpur Municipality area. Constructing Community Bath Rooms for ladies with water supply facility invillages. Constructed a “Cause Way” over Naktinalla in Babudhi village. Donated Rs. 23 Lakh in last 5 years to Sundargarh District PeripheralDevelopment Committee for undertaking various development work in thedistrict. Also granted a financial assistance of Rs. 66 Lakh to the committee forconstructing bridges in village Malidhi and Jhagarpur in 2009-10. Donated Rs. 31 Lakh for construction of a “Community Kalyan Mandap” inRajgangpur. Donated Rs 4.5 Lakh to “HOPE” for construction of a school building for mentallyretarded children in Rajgangpur. Donating Rs. 5000/- every month forremuneration of a teacher in the said school. Donated Rs. 3.5 Lakh to “Vedvyas Gosala” for proper upkeep of old cows. Alsodonated Rs. 1.5 Lakh to Sree Vir Pratap Gosala, Rajgangpur for sinking a deepbore well.


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2.5 BOARD OF DIRECTORS

• Shri Pradip Kumar Khaitan – Chairman• Shri Gaurav Dalmia- Managing Director• Shri Damodar Das Atal - Whole Time Director• Shri Puneet Yadu Dalmia• Shri Ved Prakash Sood• Dr. Sheo Raj Jain - Independent Director• Shri Dharmendra Nath Davar - Independent Director• Dr. Ramesh Chandra Vaish- Independent Director

2.6 RESEARCH & DEVELOPMENT

Up gradation of the quality of chemical gypsum for use as set controller. Development of ternary and quaternary blended cement for improved qualityand performance. Development of X-Ray Diffraction method for real time estimation of Slag/Flyashcontent in blended cement. Development of high strength hollow Fly ash blocks using wastes from ourcaptive mines, cement & refractory units. Use of industrial waste as alternate raw material and fuel . Use of waste wood chips, bags, waste paper, waste oil as alternate fuel

2.7 QUALITY POLICY & ESH POLICYOCL, believe and aim at total quality in our products and services to satisfy ourCustomers, and are committed to Adhere strictly to quality parameters at all stages to provide products /services conforming to customers’ requirements Meet requirements of quality management system and strive to continuallyimprove its effectiveness Develop competent human resource through planned training Establish quality objectives and review periodically to achieve continualimprovement


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2.8 ENVIRONMENT,OCCPUTATIONAL HEALTH & SAFETY POLICYWe, at OCL India Limited (Cement Division), Rajgangpur, Odisha engaged in captiveMining of Limestone amd Manufacturing of Cement are committed to continuallyimprove Performance of our Environment and Occupational Health and SafetyManagement System for sustainable development. Integrating EHS criteria in all our planning & operational activities Prevention, Minimization and Control of Workplace Injury, Ill health andPollution Complying with legislation & other requirement applicable to us and towhich we subscribe Communication of EHS policy to all our Employees and other Interestedparty Strengthening competence & EHS awareness of employees and businessassociates through continuous training Optimization of resources, particularly Raw materials, Water, Fuel & Power Reclamation & Rehabilitation of mined out areas by utilization of solidwaste and develop green belt in the area Promote safe behaviour and practices to nurture and sustain safe andhealthy work environment Establish the EHS objectives and review periodically to achieve continualimprovement

2.9 PRODUCT PORTFOLIOAt Rajgangpur cement works we manufacture eight varities of cement viz OPC 53 grade,OPC 53-S grade, OPC 43 Grade, PSC, PPC (Flyash Based), SRPC, OWC Class G Type HSRand Masonry Cement. At Kapilash Cement works we manufacture PSC at present.2.9.1 OPC 33 gradeThis cement is used for general civil construction work under normal environmentalconditions. The compressive strength of cement after 28 days test as per BISspecification is 33 MPa. Due to low compressive strength, this cement is normally notused where high grade of concrete viz, M-20 and above is required. The availability ofhigher grades of OPC in the market impacts the usage of 33 grade OPC as these days 43grade OPC is normally used for general construction work. This grade of cement is moreuseful for mass concreting and plain cement concreting and can also be used forplastering and single storied individual houses.


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2.9.2 53 & 53-S -grade OPC (IS:12269-1987):53-grade OPC is a high strength cement. According to the BIS requirements, 53-gradeOPC must have a 28-day compressive strength of no less than 53 MPa For certainspecialized products, such as pre-stressed concrete and certain pre-cast concrete itemsrequiring high strength, 53-grade OPC is considered useful as it can produce high- gradeconcrete at lower cement content levels. We produce 53-grade OPC by exposing theclinker to the grinding process for longer period of time, which results in a higherdensity and stronger cement.53-grade OPC is a high strength OPC, and can be used for the followingapplications: Pre-cast concrete items such as pavingblocks, tiles and building blocks Pre-stressed concrete components; andRunways, concrete roads and bridges High-rise buildings, Flyovers andConcrete structures where high gradeconcrete is normally required

53-S grade OPC can be used for the following application:Manufacturing of Railway sleeper2.9.3 43-grade OPC (IS-8112:1989):According to the BIS requirements, 43-grade OPC must have a 28-day compressivestrength of no less than 43 MPa.43-grade OPC is commonly used in the following applications: General civil engineeringconstruction work including residential,commercial & Industrial buildings Roads, Bridges, Flyovers andIrrigation projects Pre-cast items such as blocks, tilesand pipes Asbestos products such as sheetsand pipes; and Non-structural works such asplastering and flooring

2.9.4 Portland Slag Cement (IS-455:1989) :Portland slag cement is manufactured by intergrinding Portland cement clinker,gypsum and Blust furnace granulated slag. It is also manufactured by blending OPC withground Granulated Blast furnace slag through mechanical blending.


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Portland Slag Cement is commonly used for the following applications General civil engineering construction worksbut mainly preferred for construction ofmarine structures and in coastal areas whereexcessive amount of chloride and sulphate arepresent. It can also be used for mass concreteworks.Features of Konark PSC: It has high ultimate strength with higher rate of gain ofstrength than normal OPC available in market. Lower water demand Lower ShrinkageWith high compressive strength Konark PSC ensures substantial savings in cementconsumption.

2.9.5 Portland Pozzolana Cement-Fly ash based (IS:1489 Part-1 –1991):Portland Pozzolana cement is manufactured by intergrinding Portland cement clinker,gypsum and fly ash a by-product of thermal power plants.Portland Pozzolana Cement is normally used for the followingapplications: Useful for general construction works and especiallysuitable for works in aggressive environmental conditions,employed for water retaining structures, marine works,mass concreting such as dams, retaining walls and sewagepipes.

Features of Konark PPC: It is manufactured with carefully selected particle sizes of pozzolana (Flyash)ideal for denser and more durable concrete. It is having low heat of hydration and corresponding resistance to exposure invarious environmental chemicals such as salt water. It is particularly suitable formarine and hydraulic construction and other mass concrete structures. Thiscement has durability that is equivalent to OPC and can be used most of theapplications where OPC is used.


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2.9.6 Sulphate Resisting Portland Cement (IS-12330:1988):Sulphate resisting portland cement is produced by inter-grinding special quality ofcement clinker and gypsum.Sulphate Resisting Portland cement is normally used for the followingapplications:

Used for underground structures in sulphate-salts richenvironment, effluent treatment plants, sugar and otherchemical industries where civil works are likely to besubjected to sulphate attack which induces stresses inconcrete, leading to cracks and disruption. Being speciallyformulated cement with lower C3A content SRPC is freefrom these sulphate attacks.Features of Konark SRPC

Konark SRPC with low C3A content and higher strength is an ideal cement forlaying foundation of a building in any aggressive environment containingsulphate.2.9.7 Oil Well Cement Class G Type HSR (IS-8229-1986):Oil well cement is produced by inter-grinding special quality of cement clinker withvery low C3A prepared in a rotary cement kiln and gypsum. Class G OilWell Cement is intended for use as basic well cement for surface2440m (8000ft.) depth as Manufactured or can be used withaccelerators and retarders to cover a wide range of well depths andtemperature.Oil Well Cement is used for the following application:This product is used by the petroleum industry for cementing the steelcasing to the walls of the Oil Wells. The temperature of the wells rangefrom 180º C to 250º C while the pressure varies from 1300 to 2000kg/cm2. This cement is specially formulated so that its slurry remainspump able at this high temperature and pressure for a required lengthof time and then hardens rapidly.2.9.8 Masonry Cement (IS-3466-1988):Masonry cement is produced by intimately grinding a mixture of Portland cementclinker with pozzolanic materials or inert materials, and gypsum. It is a special cementfor exclusive use in plastering and brick work.


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Konark brand masonry cement gives:

Very smooth and super surface finish of theplasters More plastic mortar mix Minimum fall of mortar while plastering walls orceiling Least wastage of mortar mix hence cost saving Ease of work (trowelling and finishing) Leak proof plaster Less water consumption for making mix More coverage while plastering.

2.10 CUSTOMER SERVICES & SUPPORT

OCL provides SMS service for every transaction made by the Customers, Dealers

SMS in Vogue: OCL provides SMS service for every transaction made by the Customers,Dealers, with an auto generated SMS sent to their registered mobiles, intimating thetransaction value, Outstanding Balance and Lorry number with time of despatch. Apartfrom this Dealers also get direct information about New Offers and Schemes, includingother information related to Target etc.Unique Dedicated fleet arrangement: To provide assured & timely delivery toesteemed customers and dealers OCL has made State-of-the-art Dedicated Fleetarrangement, unique in India and first in Eastern Region. Available in differentcapacities these fleet of trucks are centrally tracked with modern Vehicle TrackingSystems (GPS based) to keep track of the consignment and ensure delivery to desiredlocations.Tankers for Cement: To facilitate fast & efficient usage of cement in upcoming Projectssites, Industries and users of Bulk cement, OCL has supported consumers by charteringBULK tankers to their services.OCL Customers’ Web Portal: For entertaining & serving the Net savvy Customers, OCLprovides them the opportunity of ordering cement from the comforts of their homesthrough their latest Web-Ordering Portal http://konarkcement.ocl.in


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CHAPTERIII


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Introduction about Dealer3.1 INTRODUCTION ON DEALERDealer is a person or firm engaged in commercial purchase and sale. Dealermay signify firms that buy or resell products at retail or wholesale basis. Aproducer cannot sell all his products directly to consumer; he has todepend upon intermediaries to push, off, his products. A dealer is anintermediary who helps to market a product. A dealer is one who purchaseand sells products. A dealer may be a wholesaler or a retailer or adistributor or any agents.The volume of sales depends on the efficiency of a dealer who assesses thepsychology of consumers and takes appropriate steps to sell a product. It isthe dealer who suggests to the manufacturers the suitable media ofadvertisement and other promotional tools. Dealers are searching for newmarketing strategies to attract and hold customers. Dealers include allactivities involved in selling goods and services to those buying for resaleor business use. Dealers buy mostly producers and sell mostly to retailersor industrial consumers.3.2 DEALER SATISFACTIONDealer wants high marginal gain from manufacturers. The main objective ofdealership is earning profits. Dealership business is different from otherbusiness. The peculiar feature of a dealer is dealing with one or moresimilar products. Dealers earn profit for goods sold from themanufacturers. The profit depends upon the value of sales both cash andcredit. Now a days the demand for cement increases every year.The manufacturers are not able to cover all the consumers directly. Withthe help of dealers only they can reach the consumers. Dealer acceptsincome from business because there is some guarantee of getting moreprofit from this business. Dealers demand more commission from themanufactures; they cover the entire market within their locality. They alsosell cement in credit to regular customer.


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3.3 PROMPT DELIVERYFor every business competition is inevitable, Knowledge, about the direct,reasonable price, prompt delivery etc., are the only ways in which one canattract more consumers. Delivery of every goods to the place of consumerswill attract every consumer. When there is a delay a small delay of one ortwo days or even hours may cause a great set back in consumersatisfaction. There are various ways we can satisfy the consumers. Oneamong them is a regular supply and prompts delivery of goods tocustomers. Even though quality is excellent and the price is reasonable wecannot satisfy the consumers, unless there is prompt delivery of goods.3.4 IMMEDIATE REALIZATION OF PROFIT AFTER SALESDealers will get their profit after sales. There are many promotionalschemes offered by the company to motivate the dealers to increase thesales volume by giving gifts like, gold coins, tours, annual incentive, awardprograms etc. This type of motivation helps company to increase their salesvolume.3.5 CRM ACTIVITIES FROM THE COMPANYUnder CRM activities company use to organise different type ofprogrammes to create goodwill in mind of customers by organising Mansonmeetings, P.O.P items, and gift coupons etc. So that they can realize thatthey are valuable customers for the company.


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3.7 OBJECTIVE OF THE STUDY

To study the level of dealer’s satisfaction on Konark Cement underBhubneshwar Region.

To assess the effectiveness of promotional tools to improve the sales. To analyze the factors that affects the dealer’s preference in dealing with

cement. To understand the strength and weakness of Konark Cement distribution.

3.8 Research Methodology

Project Research Type Descriptive ResearchData Sources Primary Data , Secondary DataResearch Approach Survey MethodResearch Instrument QuestionnaireData Analysis Logical analysisSampling Procedure Random SamplingSample Size 50 RespondentsGeographical Coverage BhubneshwarDuration of the Survey 60 days

3.8.1 DATA COLLECTION:

The descriptive nature of research necessitates collection of primary data fromDealers through market survey, personal interview technique was used and interviewwas conducted through structured questionnaire the question was asked in prearrangedmanner. The market research was conducted over a period of 30 days. Data wastabulated, analyzed and suggestion and recommendation were given.

3.8.2 RESEARCH INSTRUMENTS:

The Research instrument chosen for conducting the survey was structuredquestionnaire was prepared as show as in the annexure. The questionnaire includesopen ended as well as close ended question, few open ended question were included toobtain the perception of the Dealers. The questionnaire designed and a pilot surveywas made with the questionnaire and then changes were made accordingly with thequestionnaire.


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3.8.3 SAMPLE PLAN:A sampling technique was chosen for the study was Random Sampling Technique.This is the most common method of selecting the sample. This is because the Dealersare localized in different part of the marker a group of Dealers are chosen randomlyfrom large group. It gives all Dealers in a group and equal chance of being selected forthe purpose of the survey.

3.8.4 SAMPLE SIZE:Out of nearly 200 Dealers and sub-dealers in cement market of Bhubaneshwar and itsregion around randomly 25% of total population was considered as the sample size.

3.8.5 CONTACT METHOD:Both personal interview methods were used for conducting the market survey.Personal interview had the benefit one to one communication between the researcherand the respondent. If the respondent is having any doubt or queries in their mind,they can get their doubts clarified from the researcher on the spot and so superior ofdata was collected from the survey was collected from the survey.

3.8.6 ANALYSIS AND INFORMATION:Detailed information was collected for the project marker survey for marketing andsales promotion activities of Konark Cement for the area of Bhubaneshawar market.The information was collected by visiting the retailers of cement present inBhubaneshawar market. The interview of retailer taken in a friendly atmosphere so asto encourage them to give right information, without any hesitation.

3.8.7 ANALYSIS:The analysis of the collection information was made in scientific manner. Differentmanner rank was given to each alternative of particular questions, in the questionnaire.A particular rank was given in the following manner,Rank- 1(5 points): for the most favourable alternativeRank- 2(4 points): for the moderately favourable alternativeRank- 3(3 points): for unfavourable alternativeRank- 4(2 points): for most unfavourable alternativeRank- 5(1 point): UnfavourableTo come at the conclusion, total of each alternative of all the sample size Dealers wasmade. Thus the “sum of an alternative” having least score considered to be mostfavourable. In this manner, result is prepared for various important parameters of thesurvey. With the help of results so obtained, the findings are recorded in the form ofgraphs. The market of cement Changes as the area changes. The demand for particularcement for particular cement is much less. This is because of the crazier Trend of


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particular market. Thus the demand for the cement is not that price sensitive. Price isnot the criterion for selection of rejection of particular brand is adapted on the type ofapplication of cement and the brand name in market. Thus the awareness among thecustomers about the particular cement plays a vital role. The major types of customersare the builders and masons. The individual customers are there, but their demand isnot more. The customers are ready to give slightly high price, but he wants qualitycement. The customer perceives quality of cement as good quality because ofeffective marketing. So effective marketing is necessary.The Dealer in the marker plays an important role in the sale of the cement. They havesome expectation from the cement companies; they expected credit facility, good salespromotion schemes, and timely delivery of cement, etc among the plastic bag andpaper bag of cement, Customer prefer bag. This is because the paper bag prevents itfrom moisture and quantity remains intact. In brief cement market is sensitive tomarketing. The better & more the marketing the more is possibility of sales. Theobservations and findings of the market survey about market share and salespromotion activities are given at the next stage, in the report.

3.8.8 STATISTICAL TOOLS Percentage Weighted averageThere are briefly explained, in following

3.8.8.1 PERCENTAGEPercentage refers to special kind of ratio percentage are used in marketing Comparisonbetween two more series of data. Percentage is used to describe relationship. Since thepercentage reduce everything to a common base & these by allow meaningfulcomparison to be made.3.8.8.2 WEIGHTED AVERAGEIf something is distribution is more important than order, then their point must be bornin mind, in order that average completed is representatives of the distribution. In suchcase proper weight age is to be given to various items the weight attached to each itembeing professional to the importance of the item to be the distribution.FormulaAverage weight = Total weight ×100

Total no. Of respondents


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CHAPTERIV


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>50 tons8%

50-100tons26%

100-200tons16%

200-400tons

50%

12%

60%

28%

>5yrs 6-15yrs <15 yrs

retail82%

wholesale18%

4.1 Nature of shop.

4.2. Quantity of cement sold by the dealers per month.

4.3. Number of years in this business.

Experience No. Ofdealers

>5yrs 6

6-15yrs 30

<15yrs 14

Total 50

Nature No. ofdealers

Retail 41

Wholesale 9

Total 50

Quantity No. of dealers

>50tons 4

50-100tons 13

100-200tons 8

200-400tons 25

Total 50

TABLE-16

TABLE-17

TABLE-18

CHART-22

CHART-23

CHART-24


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LAFARGE31%

KONARK33%

AMBUJA10%

ACC8%

ULTRATECH10%

RAMCO2%

JYPEE4%

MAHA2%

Quality Perception

LAFARGE26%

KONARK28%

AMBUJA4%

BIRLA1%

ACC11%

ULTRATECH

18%

RAMCO4%

JYPEE2%

RASI0%

MAHA6%

4.4. Highest selling brand from counter (customer pull)?

Interpretation:This analysis shows that konark & Lafarge cements are the most preferable brand amongthe customers .Maha & Ramco are the brands selected by the customers & dealers becauseof its low price and more profit.4.5. Rank the factors affecting the highest selling brand (Dealers perception)

Brands Tonnes/monthLAFARGE 3400

KONARK 3625

AMBUJA 470BIRLA 90ACC 1420ULTRATECH 2280RAMCO 540JAYPEE 220RASI 80MAHA 740

Factors LAFARGE KONARK AMBUJA BIRLA ACC ULTRATECH RAMCO JYPEE RASI MAHAQuality 75 79 25 0 20 25 5 10 4Price 65 78 23 0 20 22 5 10 4BrandImage

73 79 24 0 20 24 5 10 3

Margin 61 71 21 0 18 22 5 8 5CustomerDemand

75 80 21 0 19 24 5 10 4

TABLE-19CHART-25

CHART-26

TABLE-20


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LAFARGE29%

KONARK34%

AMBUJA10%

ACC9%

ULTRATECH10%

RAMCO2%

JYPEE4% MAHA

2%

Price perception

LAFARGE31%

KONARK33%

AMBUJA10%

ACC9%

ULTRATECH10%

RAMCO2%

JYPEE4%

MAHA1%

Brand Image perception

LAFARGE32%

KONARK28%

AMBUJA10%

ACC8%

ULTRATECH14%

RAMCO2%

JYPEE4%

MAHA2%

Margin perception

LAFARGE31%

KONARK34%

AMBUJA9%

ACC8%

ULTRATECH10%

RAMCO2%

JYPEE4%

MAHA2%

Customer Demandperception

Interpretation:This analysis shows that Konark cement is highest selling brand in terms of Quality, pricewhich increased its brand image and customer demand but profit margin is less as compareto Lafarge.

CHART-27 CHART-28

CHART-29 CHART-30


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LAFARGE25%

KONARK30%

AMBUJA4%

BIRLA0%

ACC8%

ULTRATECH22%

RAMCO3%

JYPEE3%

RASI0%

MAHA5%

LAFARGE20%

KONARK28%

AMBUJA3%

ACC10%

ULTRATECH

20%

RAMCO4%

JYPEE6%

RASI1% MAHA

8%

4.6. Recommendations made by the dealers.

Interpretation:In this analysis konark cement is most preferable brand among dealers .About 30% ofdealers prefer konark cement due to its Quality, packaging and customer demand.

4.7. The frequency of personal visits by sales officer for inspiration and support(rank them)?

Interpretation:This analysis shows that personal visits by marketing people is most on konark cement forsupport and the new brands like Maha,Rasi,Ramco are now capturing market by increasingsupport to the dealers and also providing different types of schemes.

Brands PreferenceLAFARGE 10

KONARK 12

AMBUJA 1BIRLA 0ACC 3ULTRATECH 8RAMCO 1JAYPEE 1RASI 0MAHA 2

Brands SupportLAFARGE 8

KONARK 12

AMBUJA 1BIRLA 0ACC 4

ULTRATECH 8

RAMCO 2

JAYPEE 2RASI 1MAHA 3

TABLE-22

CHART-31

CHART-32

TABLE-21


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LAFARGE9%

KONARK9%

AMBUJA10%

BIRLA8%

ACC10%ULTRATEC

H8%

RAMCO12%

JYPEE10%

RASI11%

MAHA13%

LAFARGE25%

KONARK33%

AMBUJA3%

BIRLA0%

ACC6%

ULTRATECH

18%

RAMCO2%

JYPEE3%

MAHA10%

4.8. The credit (in days) enjoyed by the bands.Interpretation:In this analysis no company is providing credit days rather than they provide credit limit.And the dealers use pay and take relationship with cement companies.

4.9. The Profit margin got by selling the brands (Cash)?

Interpretation:The analysis shows that all low price brands like, Maha,Rasi,Ramco give more profit marginas compare to big brands like, Konark,Lafarge,Ultratech,Acc. The profit margin given by bigbrands vary between Rs 8-13.Maha is giving margin about Rs 16 and some hidden gifts arealso there.4.10. On the basis of their availability throughout the year mainly on seasons.

Brands Profitmargin(Rs.)

LAFARGE 10

KONARK 11

AMBUJA 12

BIRLA 10

ACC 12

ULTRATECH 10

RAMCO 15

JAYPEE 12

RASI 14

MAHA 16

Brands AvailabilityLAFARGE 9

KONARK 13

AMBUJA 1

BIRLA 0

ACC 2

ULTRATECH 7

RAMCO 1

JAYPEE 1

RASI 0

MAHA 4

TABLE-23CHART-33

CHART-34TABLE-24


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LAFARGE22%

KONARK34%

AMBUJA4%

ACC10%

ULTRATECH21%

RAMCO1%

JYPEE4% MAHA

4%

Interpretation:This analysis shows that konark and Lafarge is mostly available on sessions. It’s because asper necessary the trucks are easily diverted from depot and also the factories are nearer tobhubneshwar.4.11. Most effective advertisement activities done by which brand(rank them).

Interpretation:The analysis show that 34% of dealers say that konark cement is having effectivepromotional activities and then Lafarge, ultratech, Acc but Maha is also now coming up withbetter promotional activities.

4.12. Brand wise ranking for all activity (Appreciation by Dealer)?

Effectivemethod of salespromotion

LAFARGE KONARK AMBUJA BIRLA ACC ULTRATECH RAMCO JYPEE RASI MAHA

Dealer meet 12 13 6 1 8 10 1 7 2

Tour 15 13 4 8 12 1 5 2

Get together 16 15 3 7 9 4

Specialschemes

15 16 4 7 10 1 3 4

Awardprograms

11 12 3 10 9 4 1

Advertisement 10 14 4 7 9 1 2 3

IncentiveSchemes

13 14 5 7 7 3 5

CRM Activities 16 13 4 8 13 3 1


KONARK 13

AMBUJA 2

BIRLA 0

ACC 4

ULTRATECH 8

RAMCO 0

JAYPEE 1

RASI 0

MAHA 1

TABLE-25

TABLE-26

CHART-35


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LAFARGE30%

KONARK28%

AMBUJA5%

ACC13%

ULTRATECH

17%

JYPEE7%

Get together

LAFARGE25%

KONARK27%

AMBUJA7%

ACC11%

ULTRATECH

17%

RAMCO1%

JYPEE5%

MAHA7%

Special schemes

LAFARGE21%

KONARK22%

AMBUJA10%

BIRLA2%

ACC14%

ULTRATECH

17%

RAMCO2%

JYPEE9%

MAHA3%

Dealer meet

LAFARGE25%

KONARK22%

AMBUJA7%

ACC13%

ULTRATECH

20%

RAMCO2%

JYPEE8%

MAHA3%

Tour

LAFARGE

22%

KONARK

24%

AMBUJA6%

ACC20%

ULTRATECH

18%

JYPEE8%

MAHA2%

Award programs

LAFARGE20%

KONARK28%

AMBUJA8%

ACC14%

ULTRATECH

18%

RAMCO2%

JYPEE4%

MAHA6%

Advertisement

CHART-36 CHART-37

CHART-41

CHART-38

CHART-40

CHART-39

Appreciation by dealers


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LAFARGE22%

KONARK35%

AMBUJA5%

ACC10%

ULTRATECH

18%

RAMCO2%

JYPEE3%

RASI0%

MAHA5%

LAFARGE24%

KONARK26%

AMBUJA9%

ACC13%

ULTRATECH

13%

JYPEE6%

MAHA9%

Incentive Schemes

LAFARGE28%

KONARK22%

AMBUJA7%

ACC14%

ULTRATECH22%

JYPEE5%

MAHA2%

CRM Activities

Interpretation:The analysis shows that konark cement is good in all but some of the activities like, tour, gettogether and CRM activities are good on Lafarge cement.

4.13. Packaging Quality of brands compared based on HDPE bags (customerpreferance)?

Interpretation:This analysis shows that konark is having the highest percentage in terms of packagingquality about 35% and next good packaging brands are Lafarge and Ultratech which ishaving 22% and 18%. But in case of LP packing’s ACC F2R is on top most followed by Lafargeconcerto.

Brands QualityLAFARGE 8

KONARK 13

AMBUJA 2

BIRLA 0

ACC 4

ULTRATECH 7

RAMCO 1

JAYPEE 1

RASI 0

MAHA 2

TABLE-27

CHART-42 CHART-43

CHART-44


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LAFARGE14%

KONARK12%

AMBUJA11%

ACC12%

ULTRATECH14%

RAMCO7%

JYPEE7%

RASI11%

MAHA11%

LAFARGE26%

KONARK30%

AMBUJA3%

ACC7%

ULTRATECH21%

RAMCO2%

JYPEE2%

RASI1%

MAHA7%

4.14. Quick delivery system?

Interpretation:This analysis shows that konark is delivering faster and then Lafarge because therestockyard is nearer than any other brand on market.

4.15. Rank the brands which satisfy most on damage claim settlement

Interpretation:This analysis shows that Lafarge and Ultratech give damage claim settlement faster thanother brands which is about 14%.


KONARK 12

AMBUJA 1

BIRLA 0

ACC 3

ULTRATECH 8

RAMCO 1

JAYPEE 1

RASI 1

MAHA 3


KONARK 3

AMBUJA 3

BIRLA 0

ACC 3

ULTRATECH 4

RAMCO 2

JAYPEE 2

RASI 3

MAHA 3

TABLE-29

TABLE-28 CHART-45

CHART-46


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LAFARGE26%

KONARK27%

AMBUJA5%

BIRLA1%

ACC9%

ULTRATECH22%

RAMCO2%

JYPEE2%

MAHA6%

LAFARGE21%

KONARK24%

AMBUJA6%

ACC8%

ULTRATECH

17%

RAMCO6%

JYPEE2%

RASI1% MAHA

15%

4.16. Small quantity supply directly to customer’s faster (100 bags)?

Interpretation:This analysis shows nearly about all big brands give faster delivery service to customers.After placing order with in 36hrs the order is delivered to customer.Konark is faster becausefactory is nearby bhubneshwar if less amount of cement is available on depot then theyarrange it from factory. Ultratech sometimes gives slower service because on seasons thestock is less on depot.

4.17. The incentive schemes which satisfy dealer most eg: gold ,tour etc.?


KONARK 10

AMBUJA 2

BIRLA 1

ACC 4

ULTRATECH 8

RAMCO 1

JAYPEE 1

RASI 0

MAHA 2

Brands IncentiveLAFARGE 8

KONARK 9

AMBUJA 2

BIRLA 0

ACC 3

ULTRATECH 6

RAMCO 2

JAYPEE 1

RASI 0

MAHA 6

TABLE-30

TABLE-31

CHART-47

CHART-48


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LAFARGE27%

KONARK19%

AMBUJA6%

ACC11%

ULTRATECH32%

JYPEE2% MAHA

3%

LAFARGE26%

KONARK26%

AMBUJA5%

ACC8%

ULTRATECH

24%

RAMCO1%

JYPEE4%

MAHA6%

Interpretation:This analysis shows that konark give good incentive schemes to dealers. Where newentrants maha, rasi and ramco are giving very lucrative incentive schemes to capture themarket and increase their sales volume.4.18. Timely distribution of informative test certificates and brochures for customersgiven by which brand(rank them).

Interpretation:This analysis shows that konark, Lafarge & Ultratech give periodic information to thecustomers and dealers.4.19. The effective technical services team relating IHB visit, brand conversationability and under win-win situation (rank them)?


KONARK 10

AMBUJA 2

BIRLA 0

ACC 3

ULTRATECH 9

RAMCO 0

JAYPEE 1

RASI 0

MAHA 2


KONARK 6

AMBUJA 2

BIRLA 0

ACC 4

ULTRATECH 11

RAMCO 0

JAYPEE 1

RASI 0

MAHA 1

TABLE-32

TABLE-33

CHART-49

CHART-50


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LAFARGE28%

KONARK23%

AMBUJA5%

ACC11%

ULTRATECH23%

RAMCO2%

JYPEE3%

MAHA5%

Interpretation:Lafarge and Ultratech is having effective technical services team about 32% & 27% ofcustomer and dealers use the benefit of technical services provided by the brands. Ultratechand Lafarge also provide mobile van for assistance of technical services.

4.20. Quarry handling service provided by the company to the customer thatsatisfies most (Rank them).

Interpretation:After Quarry handling services provided by Lafarge is very good. Ultratech and konark alsohandle quarry better and help the dealers and customers to clarify there problem.

Brands After salesLAFARGE 11

KONARK 9

AMBUJA 2

BIRLA 0

ACC 4

ULTRATECH 9

RAMCO 1

JAYPEE 1

RASI 0

MAHA 2

TABLE-34 CHART-51


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CHAPTER-V


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5.1FINDINGSIt can be concluded from the study that konark Cement has a good brand image in thedealers mind in Bhubneshwar. The company lack on technical services which can beimproved by increasing efficiency level of technical team. 82% of dealers use to retailer.

50% of respondent’s monthly sales turnover is more than 200 tonnes.

60% of respondents having experience between 6-15 years.

Konark Cement is the highest selling brand from counter and dealers also

recommend konark cement to the customer.

Personal visits by the sales officer of the company to support the dealers is very good

but in some sub-dealers counters less frequency of visits made by sales officer.

Earlier company was not doing any promotion activity but after doing the

promotions the brands image is increasing in front of dealer and customer which is

strengthening the companies brand image.

Quality and packaging is very good but some of the dealers want the packaging

should by LP packaging which will be ecofriendly and good packaging looks attractive

to the customers.

The company is providing on time damage claim settlement though in some cases

company is slow on damage claim settlement.

Incentive schemes of the company is good but schemes should me more due to cut

trough competition in the market by the new entrants like, maha, rasi, & ramco.

The technical service team is good but the team should be more efficient for better

market hold on future.

At par with Lafarge on quarry handling services should be more efficient.5.2 SUGGESTION AND RECOMMENDATIONS I would humbly suggest the company that to improve the quality of cement on

Kapilash Cement Works division as suggested by dealers. By increasing moreadvertisement, regular contact, marketing experts dealing with dealers in allrural and urban areas. The company can improve their market shares, brandloyalty and promote their sales easily.


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For customer care Services and technical services Company should start itsconcrete mobile van facilities. Non-Trade entry is growing rapidly so company should improve supply tocapture maximum market share. Company should start its internal call centre for its valuable customers by whichthey can directly interact with company experts. Company can increase society welfare programs in rural area. By this companycan enhance goodwill among people for future. By giving some gifts and best wishes cards to the customer that your buyingdecision is very good. Company can show that they are important to company. Company should organize seminars, conferences, contractors meetings time totime.5.3 SUGGESTION FROM DEALERS A Price fluctuation creates problems for dealers and sub-dealers as they cannot keep

the commitments of price to customers.

On interviewing Dealers/sub-dealers the most important thing they said was about

the price flexibility, they want that the company should give them the price flexibility

to play in the market.

The packaging should be LP bags which give the product more safety and

The profit margin should be increased so that they can get more profit on selling the

items.5.4 LIMITATIONS Lack of cooperation from the dealers and sub-dealers in regard to givinginterview. As they dosen’t understand the importance of survey. It was found in some cases dealers showed inclination towards certain brandswhich gave them more margins when compared to others. As the sub-dealers and dealers thought that it was unwise for that to give theirdetails of business as they feared competitors would take advantage.


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CHAPTERVI


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6.1 SWOT Analysis

STRENGTH

Bargaining power of the supplier is high because of few best sellers like: Lafarge, Acc,Ultratech.

Good brand image. Best quality product. On time delivery. Value for money. Regular visit by sales officer.

WEAKNESS High dependence on imported coal. Need to better sales promotion. Not to use foreign technology fully. Lack on technical services. Lack on handling customer complaint. Lack on handling damage claim settlement. The major concern for the industry are : Continuous increase in labour cost. Shortage of skilled labourers. Royalty for limestone mines is limited.

OPPORTUNITIES Cement demand increases as the economy grows. Increase on infrastructure development by the Indian government ex. BDA. Increase in demand for housing development like housing development. Despite slightly lower economic growth, the construction and infrastructure sector is

expected to record healthy growth, which augurs well for cement industry. The modernization and productivity improvement leads to growth on cement industry.

THREATS Regulatory tightening for quarrying of limestone over environment issues. From the new entrant cement companies Like: Maha, Ramco, Rasi who offers low

price and high margin. Production may be lower due to increase in price, freight, coal, and diesel.


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CHAPTERVII


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CONCLUSIONTo attain the objective of the project detailed information was collected from the marketof Bhubaneshwar. The market research has revealed many facts and figures about thecurrent scenario in the market prevailing.In the market, Konark cement is well known brand of cement. This is the result of thegood quality of the Konark cement along with their effective marketing efforts, whichcovers the whole market. Customers of Lafarge cement are highly satisfied with theQuality, packaging, services, promotion etc. as they do not face any problem after usingit. There are ten major players in the market but the major completion is between thethree brands of cement konark, Lafarge, Ultratech. Were Ultratech is also providinggood quality of cement and services to the dealers and customers. Because of goodmarketing efforts, Konark cement is able to grasp some share of various other brandsalso.The market survey undertaken shows that effective marketing efforts play a vital role increating the goodwill for the brand. The distribution channel of cement industry mustbe well designed and made effective this ensures timely availability of cement tocustomers.Good marketing creates good image i.e. brand building. From the study it can beconcluded that the overall satisfaction for Konark cement in good .Konark cementstands best a quality. Dealers are satisfied as per quality, channel of distribution, dealersales support etc. But dealers are not satisfied on profit margin given by the companyand also by the incentive schemes and technical support provided by the company.


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CHAPTERVIII


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SCOPE AND LIMITATIONS8.1 SCOPE OF THE STUDY

Other than the objectives of the study some of the related factors were also covered inwhich some of them are. Fast moving brand of cement Dealers opinion on price fluctuation Opinion about promotional support Technical Support After sales services Customer survey. Branding of cement.

These factors are given more importance while analyzing the market. Since the futurephase was to be adopted after finding out the important factors relating to this market,sincere attempt is made to elicit the above information’s.8.2 LIMITATIONS OF THE STUDY

The study was carried out in Bhubneshwar only, owing to time and costlimitations. Simple size which limited to 50 due to time and cost constrains it can beincreased. This research was conducted among dealers and sub-dealers only for obtainingconsumer response and dealer response; further survey among users of cementis suggested.


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ANNEXURES-3BIBLOGRAPHY Kotler, Philip “Marketing Management” published by Vikas publishing house Pvt.ltd. New Delhi. Kothari, C. R. “Research Methodology” (third edition 2007) published by new ageinternational (P) ltd. “CMA Magazine (Cement Manufacturers Association)”. Aaker, D.A. and Shansby, J. (1982) “Positioning your Product,” Business Horizons,25, (May/June), 56-62. Alden, D. L., Steenkamp, J. B. E. M. and Batra, R. (1999) “Brand Positioningthrough Advertising in Asia, North America, and Europe: The Role of GlobalConsumer Culture,” Journal of Marketing, 63 (January), 75-87. Best, R.J. (2004) Market-Based Management: Strategies for Growing Customer

Value and Profitability, 3rd Edition, Upper Saddle River, NJ, Prentice-Hall, 246-267. Bhat, S. and Reddy, S. K. (1998) “Symbolic and Functional Positioning ofBrands,”Journal of Consumer Marketing 15, (1), 32-43. Blankson, C. and Kalafatis, S. P. (2001) “The Development of aConsumer/Customer- Derived Generic Typology of Positioning Strategies,”

Journal of Marketing Theory and Practice, 9 (2), (Spring), 35-53. Crawford, C. M. (1985) “A New Positioning Typology,” Journal of Product

Innovation Management, 4 243-253.News Papers Times of India Hindustan Times Economic TimesWeb Based References http://www.oclindia.com http://www.cma.com http://www.scribd.com http://www.amzon.com http://www.wikipedia.com


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ANNEXURES-4QUESTIONNAIRE“DEALER SATISFACTION ON CEMENT INDUSTRY UNDER BHUBANESWAR

REGION”Personal data:Dealer Name:Place of Business:Address:Mobile No.:

Part A------------------------------------------------------------------------------------------------1. What is the nature of your shop?

a. Retail(>60%)b. Whole Sale(>40%)

2. How much quantity of cement you sell per month?

3. Since how many years you are in this business?a. Less than 5 yearsb. 6 – 15 yearsc. More than 15 years

4. Which brand is highest sold form your counter (customer pull)?

5. Rank the factor affecting the highest selling brand? (1: Least satisfied,5: Most satisfied)

Age <35yrs 35-45yrs > 45yrs

Educational Level Below Pre degree UG PG

Less than 50 tons50-100 tons100-200 tons200-400 tons

Factors 5 4 3 2 1QualityPriceBrand ImageMarginCustomer Demand

Brands Lafarge Konark Ambuja Birla Acc Ultratech Ramco Jypee Rasi MahaRanks


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Part B (Rank 1-10)--------------------------------------------------------------------------------------------------Rank the following brand:-

1. Which brand do you (dealer) prefer the most?

2. Ranking of the frequency of making personal visits SO for inspiration andsupport?

3. How much credit (in days) do you enjoy from the stockiest of following brands?

4 .What is the Profit margin you get by selling the brands (Inclusive annually cashbenefit)?

5. Rank the brands on the basis of their availability throughout the year mainly onseasons?

6. Rank the various brands on the basis of their effective promotional activities?



Brands Lafarge Konark Ambuja Birla Acc Ultratech Ramco Jypee Rasi Mahadays

Brands Lafarge Konark Ambuja Birla Acc Ultratech Ramco Jypee Rasi MahaRs.




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7. According to you which brand have most effective method of sales promotion?Lafarge Konark Ambuja Birla Acc Ultratech Ramco Jypee Rasi Maha

Dealer meetand TrainingTour

Get together

SpecialSchemesAwardProgramsAdvertisementIncentiveSchemesCRMActivities

8. Please rate in terms of Quality and packaging of brands customer prefer?

9. Rank on the basis of quick delivery system (100 bags)?

10. Rank the brands which satisfy most on damage claim settlement?

11. Rank the brands which supports on small quantity supply directly to customersfaster?

12. Rank on the basis of the brands incentive schemes which satisfy you most?







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13. Rank the brands which give Test certificates and vouchers for customers aboutdifferent grades and quality standards periodically?

14. On the basis of the effective technical services team of IHB visit, brandconversation ability or redressal of customer complaints?

15. Rank the brands after sale service satisfy you most?

16. Any suggestion you would like to make for the brands?




Brands Suggestion

Lafarge

Konark

Ambuja

Birla

Acc

Ultratech

Ramco

Jaypee

Rasi

Maha

Documents

Dealers level of satisfaction OCL India Cement Internship project report 2012-13