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CHAPTER I
INTRODUCTION
The term switchgear, used in association with the electric power system, or grid, refers to the
combination of electrical disconnects, fuses and/or circuit breakers used to isolate electrical
equipment. Switchgear is used both to de-energize equipment to allow work to be done and to
clear faults downstream. The very earliest central power stations used simple open knife
switches, mounted on insulating panels of marble or asbestos. Power levels and voltages rapidly
escalated, making open manually-operated switches too dangerous to use for anything other than
isolation of a de-energized circuit. Oil-filled equipment allowed arc energy to be contained and
safely controlled. By the early 20th century, a switchgear line-up would be a metal-enclosed
structure with electrically-operated switching elements, using oil circuit breakers. Today, oil-
filled equipment has largely been replaced by air-blast, vacuum, or SF6 equipment, allowing
large currents and power levels to be safely controlled by automatic equipment incorporating
digital controls, protection, metering and communications.
One of the basic functions of switchgear is protection, which is interruption of short-circuit and
overload fault currents while maintaining service to unaffected circuits. Switchgear also provides
isolation of circuits from power supplies. Switchgear is also used to enhance system availability
by allowing more than one source to feed a load.
1.1 OBJECTIVE OF TRAINING
The main objectives of training are as follows:
To gain practical experience and company knowledge
To know about the industrial profile of the company
To know about the switchgear industry, switchgear production, users etc
1
To know about the organization structure
To know about the various functions of the department
1.1 SCOPE OF STUDY
The scope of the study is limited in approach as it mainly based on factual aspects of the company
collected through visits to center of manufacturing unit and through primary instructions and secondary
data compiled from the official documents of the company. To open the new visit managerial skills, the
study of manufacturing unit will open up divergent thinking to add on to the thought process.
ABSTRACT:
The report entitled “Industrial Training Report Of Megawin Switchgear P-Ltd” is about the
overall functions exercised by MEGAWIN. They manufacture all the devices used for
switchgear manufacturing including the sub-components. They purchase various raw materials
that is needed for manufacturing from various suppliers. The purchase procedure starts at
Indenting by the department that requires the material and goes to the cost department and
finance department for required approval. In between various activities like Liquidated Damages
calculation, Spare Parts procurement, Guarantee in Liability Defect period etc are undertaken.
Once all the terms and conditions are formulated and approved, they purchase the raw materials.
They compete with their competitors by providing quality products and quick delivery to
customers. They are going to start a separate unit for erection commission. The performance of
the organization is evaluated.
2
CHAPTER-2
INDUSTRY PROFILE
2.1 FEATURES OF SWITCHGEAR INDUSTRY
Around Rs. 3,000 crore (US $ 698 mn) market
Three types of product markets - HT circuit breakers, LT circuit breakers, Motor
controllers & Contactors
Switchgear are devices used to regulate transmission and distribution of power both at
the generation as well as consumption end
India produces the entire range of circuit breakers from bulk oil, minimum oil, air blast,
vacuum to SF6 circuit breakers
In the low tension category MCB, Air circuit breakers, switches, HRC fuses are
produced in different versions
Industry caters to the demand of the domestic market and is in the process of
establishing itself in overseas markets
Over 30 players in the market
Small scale sector activity high in LT switchgear, motors, starters & contactors
USER SEGMENTS
State Electricity Boards, Industries major user segments
Panel board industry a major user of LT switchgear
Non electrical machinery another large user of LT switchgear
MAJOR PLAYERS
High tension circuit breakers - Bharat Heavy Electricals Ltd.(BHEL), Asea Brown
Boveri (ABB), Crompton Greaves, GEC Alsthom , Siemens, MEGAWIN.
3
TYPES
A piece of switchgear may be a simple open air isolator switch or it may be insulated by some
other substance. An effective although more costly form of switchgear is gas insulated
switchgear (GIS), where the conductors and contacts are insulated by pressurized sulfur
hexafluoride gas (SF6). Other common types are oil [or vacuum] insulated switchgear.
The combination of equipment within the switchgear enclosure allows them to interrupt fault
currents of many hundreds or thousands of amps. A circuit breaker (within a switchgear
enclosure) is the primary component that interrupts fault currents. The quenching of the arc
when the circuit breaker pulls apart the contacts open (disconnects the circuit) requires careful
design. Circuit breakers fall into these four types:
Oil circuit breakers rely upon vaporization of some of the oil to blast a jet of oil through
the arc.
Gas (SF6) circuit breakers sometimes stretch the arc using a magnetic field, and then rely
upon the dielectric strength of the SF6 to quench the stretched arc.
Vacuum circuit breakers have minimal arcing (as there is nothing to ionize other than the
contact material), so the arc quenches when it is stretched a very small amount (<2–
3 mm). Vacuum circuit breakers are frequently used in modern medium-voltage
switchgear to 35,000 volts.
Air circuit breakers may use compressed air (puff) to blow out the arc, or alternatively,
the contacts are rapidly swung into a small sealed chamber, the escaping of the displaced
air thus blowing out the arc.
Circuit breakers are usually able to terminate all current flow very quickly: typically between
30 ms and 150 ms depending upon the age and construction of the device.
Several different classifications of switchgear can be made[1]:
By the current rating.
By interrupting rating (maximum short circuit current that the device can safely
4
interrupt)
o Circuit breakers can open and close on fault currents
o Load-break/Load-make switches can switch normal system load currents
o Isolators may only be operated while the circuit is dead, or the load current is
very small.
By voltage class:
o Low voltage (less than 1,000 volts AC)
o Medium voltage (1,000–35,000 volts AC)
o High voltage (more than 35,000 volts AC)
By insulating medium:
o Air
o Gas (SF6 or mixtures)
o Oil
o Vacuum
By construction type:
o Indoor (further classified by IP (Ingress Protection) class or NEMA enclosure
type)
o Outdoor
o Industrial
o Utility
o Marine
o Draw-out elements (removable without many tools)
o Fixed elements (bolted fasteners)
o Live-front
o Dead-front
o Open
o Metal-enclosed
o Metal-clad
o Metal enclose & Metal clad
o Arc-resistant
5
o By IEC degree of internal separation
By interrupting device:
o Fuses
o Air Blast Circuit Breaker
o Minimum Oil Circuit Breaker
o Oil Circuit Breaker
o Vacuum Circuit Breaker
o Gas (SF6) Circuit breaker
By operating method:
o Manually-operated
o Motor-operated
o Solenoid/stored energy operated
By type of current:
o Alternating current
o Direct current
By application:
o Transmission system
o Distribution.
MANUFACTURING PROCESS:
Manufacturing process accommodates the following production areas:
Fabrication Department
High speed laser profiling machines, Traumatic 180 CNC punching machines, CNC
press brakes/copper punching machines/copper bending machines; Mig welding sets
multiple (Argon gas); 3-ton 100ft span crane.
Coating Department
Electro-static powder coating plant with manual spray applicators for the application of
epoxy paint.
6
Busbar Coating Plant
To ensure the most effective application of epoxy-resin insulation to up to 60 busbar
sections per hour, S&I has installed a purpose-designed coating plant. The plant can
accommodate materials with varying dielectric properties as required by MV and LV
switchgear busbars.
Electrical Sub-Assembly and Electrical Fitting
Computer-aided cable marking system (Raychem); Programmable controlled cable
stripping machine and looming facility. Computer controlled engraving machine
Test Department
High temperature soak test facility
Multiple simulation panels for functional testing
Primary and secondary injection test set
High voltage dielectric test facilities to 50kV
Ductor test set for joint resistance testing
2.2 INDUSTRY TRENDS
SWITCHGEAR & CONTROL GEAR
Switchgear refers to the combination of electrical disconnects, fuses and/or circuit
breakers used to isolate electrical equipment. Switchgear is used both to de-energise
equipment to allow work to be done and to clear faults downstream. Switchgear &
Control gear are indispensable not only in transmission and distribution of power, but
anywhere where there is a need to access and control electricity. The Indian Switchgear
Industry is manufacturing the entire range of circuit breaker from bulk oil, minimum oil,
air blast, vacuum to sulphur hexafluoride as per standard specification. Switchgear &
Control gear Industry in India is a fully developed and mature industry, producing and
supplying a wide variety of switchgear and control gear items needed by the industrial
7
and power sector. This industry sector in fact manufactures the entire voltage range from
240 V to 800 KV.
Secondary equipment such as relays used for various types of fault protection, also
known as control gear, have made significant advances due to major development in the
field of electronics. The digital relays are fast replacing the conventional relays due to
technology advancement, compact size & its reliability. As per recent trends in addition
to protection and control of power, monitoring and signaling are becoming integral part
of switchgears. With monitoring, the fault conditions can be predicted whereas signaling
helps to know the status of switch gears at various locations.
The production, import and export figures for the last 2 years are as follows:-
Year
Production
(non-SSI)
(Lakh nos.)
Exports
(Rs. Crore)
Imports
(Rs. Crore)
2007- 08 189 1,613 2,629
2008- 09 178 1,373@ 2,678@
2.3 MARKET SIZE:
India's vibrant economy needs matching improvements in the infrastructure. Power sector will
play important role in the economic development and hence need focused attention. But due to
global economic crisis India electrical equipment half yearly growth registered in 2008-09 is
down to 8.57 percent from 14.6 percent of the previous financial year (2007-08). However,
India posted a positive growth compared with global growth where the growth has been
negative a fall of 2.2 percent in 2008 compared to 2007.
India has taken number of legislative and policy initiatives to expedite power sector
development such as Rajiv Gandhi Gramin Vidyutikaran Yogna (RGGVY). All these initiatives
8
provide loads of investment opportunities to FIIs and other investors. The power sector reforms
if implemented as scheduled will create large business for power sector equipment
manufacturers and service providers. In India electrical sector export in the past 3 years (2004-
05 to 2007-08) has grown with much higher CAGR of 57.28 percent compared to 32.25 percent
for the period of 1995-96 to 2007-08. We can expect a continuous handsome growth for this
sector for at least next five years and it is expected to cross INR 400 Billion by 2013.
Due to financial crisis global electrical equipment market has fallen by 2.02 percent in
2008 compared to previous year 2007.
In 2008 Power Cables and Switchgear together controls 60 percent of the market share
in global electrical equipment market.
India electrical sector exports have grown with a 40 percent in 2007-08 to compared
previous year 2006-07.
Due to economic slowdown India electrical sector has shown a decline of 6.04
percentage points for the half-yearly 2008-09 compared to half-year 2007-08.
Despite India electrical sector negative growth Voltage transformers and Power
transformers has shown a growth of 28.6 and 25.7 percent respectively for the year
2008-09 compared to 2007-08.
2.4 BARRIERS TO ENTRY
“A barrier to entry is anything that prevents entry when entry is socially beneficial
”
Production of switchgears is complicated because of its various approval process
It should be approved by the all the electricity boards
It should undergo the qualification of test
It should obtain technical rights
It should be certified by CPRI (like ISO) Central Power Research Institute
9
OTHER BARRIERS:
Advertising - Incumbent firms can seek to make it difficult for new competitors by
spending heavily on advertising that new firms would find more difficult to afford. This
is known as the market power theory of advertising. Here, established firms' use of
advertising creates a consumer perceived difference in its brand from other brands to a
degree that consumers see its brand as a slightly different products. Since the brand is
seen as a slightly different product, products from existing or potential competitors
cannot be perfectly substituted in place of the established
firm's brand. This makes it hard for new competitors to gain consumer acceptance.
Control of resources - If a single firm has control of a resource essential for a certain
industry, then other firms are unable to compete in the industry.
Cost advantages independent of scale - Proprietary technology, know-how, favorable
access to raw materials, favorable geographic locations, learning curve cost advantages.
Customer loyalty - Large incumbent firms may have existing customers loyal to
established products. The presence of established strong brands within a market can be a
barrier to entry in this case.
Distributor agreements - Exclusive agreements with key distributors or retailers can
make it difficult for other manufacturers to enter the industry.
Economy of scale - Large, experienced firms can generally produce goods at lower
costs than small, inexperienced firms. Cost advantages can sometimes be quickly
reversed by advances in technology. For example, the development of personal
computers has allowed small companies to make use of database and communications
technology which was once extremely expensive and only available to large
corporations.
Government regulations - It may make entry more difficult or impossible. In the
extreme case, a government may make competition illegal and establish a statutory
monopoly. Requirements for licenses and permits may raise the investment needed to
10
enter a market, creating an effective barrier to entry.
Inelastic demand - One strategy to penetrate a market is to sell at a lower price than the
incumbents. This is ineffective with price-insensitive consumers.
Intellectual property - Potential entrant requires access to equally efficient production
technology as the combatant monopolist in order to freely enter a market. Patents give a
firm the legal right to stop other firms producing a product for a given period of time,
and so restrict entry into a market. Patents are intended to encourage invention and
technological progress by offering this financial incentive. Similarly, trademarks and
servicemarks may represent a kind of entry barrier for a particular product or service if
the market is dominated by one or a few well-known names.
Investment - That is especially in industries with economies of scale and/or natural
monopolies.
Network effect - When a good or service has a value that depends on the number of
existing customers, then competing players may have difficulties in entering a market
where an established company has already captured a significant user base.
Predatory pricing - The practice of a dominant firm selling at a loss to make
competition more difficult for new firms that cannot suffer such losses, as a large
dominant firm with large lines of credit or cash reserves can. It is illegal in most places;
however, it is difficult to prove.
Restrictive practices, such as air transport agreements that make it difficult for new
airlines to obtain landing slots at some airports.
Research and development - Some products, such as microprocessors, require a large
upfront investment in technology which will deter potential entrants.
Supplier agreements - Exclusive agreements with key links in the supply chain can
make it difficult for other manufacturers to enter an industry.
Sunk costs - Sunk costs cannot be recovered if a firm decides to leave a market. Sunk
costs therefore increase the risk and deter entry.
Vertical integration - A firm's coverage of more than one level of production, while
pursuing practices which favor its own operations at each level, is often cited as an entry
barrier
11
FACTORS THAT MAKE THE INDUSTRY ATTRACTIVE:
Huge profit and technical collaboration with most of the industries.
Economic development
Job opportunities
Gain technical knowledge
Customer satisfaction
MAINLY ATTRACT THE FOLLOWING USERS:
Windmills
Spinning mills
Malls
Apartments
Mines
Water projects
Electricity boards
12
CHAPTER 3
COMPANY PROFILE
Name of the Industry: MEGAWIN SWITCHGEAR PVT .LTD
Address : UNIT –I ( H.O & Registered Office)
PO Box No 434,
Perumalmalai Adivaram,
Alagapuram Post.
Salem : 636004
Ph No : 0427-2330288,2330498 Fax : 2330502
UNIT – II
2/18, 2/19
Perumalmalai Adivaram,
Alagapuram Post.
Salem : 636004
UNIT- III
SF.No.263/2, D.No.5/268-1
13
Steel Plant Road, Jagir Ammapalayam,
Salem – 636302
Ph: 0427-6457395.
Name of the Promoters: (A.) Shri. S. Ganesan.
(B.) Smt. Jayanthy Ganesan
Share Ratio: (A.)- 90% (B.)- 10%
PROMOTERS’ DETAIL:
Shri. S.Ganesan, Managing Director:
Shri S. Ganesan is a B.E (Electricals) REC, Entrepreneur. Started his carrier by assisting his
farther who was then engaged in electrical good trading. Out of Interest and to diversify the
activities started a small fabrication/machine shop for manufacturing custom built LT/HT panels.
Based on the knowledge and the experience gained on customs built panels, he ventured into the
field of manufacture of high tension Switchgear. Simultaneously he gained marketing
knowledge. With innovative thinking and involvement in research and development in connected
Switchgear field, up gradation was possible. Diversification of connected products has been his
priority during the last two decades and today excels in switchgear industry not only in the field
of manufacture but, also towards penetrating the market , competing with the giants in the field
such as Siemens, ABB, Areva, Crompton besides BHEL. Traveled widely around the world
towards acquiring knowledge on further improvement of various products manufactured at
Megawin besides marketing related activities.
Smt. Jayanthi Ganesan, Director
Smt. Jayanthi Ganesan, is a MA., Post Graduate, managing the complete administration
especially in Purchase/Accounts besides HR.
14
NOTE: The above mentioned persons are lifetime directors
3.1 BRIEF HISTORY
Megawin was started in the year 1992. Intially it was started as Panel builders and during the
year 1992-93 entered into Technical Collaboration with Enkom, Yugoslavia for manufacture of
HT Air Break Load Break Switches & Isolators. Over the years they developed indigenously
Vacuum Contractors, Vacuum Circuit Breakers, Current/Voltage Transformers, Cable Couplers,
Resin Cast Transformers Relays, Fuses, Auto Recloses etc.
BORN TO WIN:
The journey began in 1988. MEGAWIN Switchgear was born in the mind of a young
and daring first generation entrepreneur in Salem. It had a humble beginning with only
six people. Their greatest asset was fire in the belly and an inspiration to excel. By 1990,
with a modest infrastructure, the company ventured into a Technical Collaboration with
Enkom of Yugoslavia for Load break switches and Off load isolators up to 36 KV.
Initial forays were into mining sector which warranted a great degree of customization
and robustness. A direct spin off was the development of components such as CTs, PTs,
Vacuum Contractors, ATS, Soft Starters, etc.
WILL TO WIN:
MEGAWIN Switchgear – P-Limited has emerged as an integrated medium voltage
switchgear solution for utilities, industries and infrastructure sectors. Its products range
covers system voltages from 3.6 kV TO 36 kV and the growing patronage has resulted in
a CAGR of >30%. The population of installations are in excess of 15000, spread across
the length and breadth of the country.
GROWN TO WIN:
15
1993 heralded the emergence of Megawin Switchgear as a manufacturer of VCB
Switchgear. In the subsequent years , the full range of medium voltage vacuum
switchgear was developed up to 36 kV systems. All the developments were
comprehensively tested at accredited test laboratories in the country. It tied up with
relays, through an operational joint venture, for marketing in India.
WINNOVATIONS:
Innovation has been the hallmark of MEGAWIN . the management focus and encouragement has
resulted in development of magnetically actuated VCBs, Capacitors,
INFRASTRUCTURE:
Megawin has adequate infrastructure at their works having three units at Salem located in large
area of their own with sufficient machineries and manpower. More than 450 workmen besides
160 qualified administrative/technical personnel are in their rolls and are fullygeared to meet the
increased demand.
FUTURE PLAN:
Towards a) development / manufacture of SF 6 Products such as Ring Main / Circuit Breakers.
b) HT Vacuum Interrupters c)EHV equipment
PAST PERFORMANCE:
Megawin has achieved the following turnover
YEAR 2003-04 2004-05 2005-06 2006-07 2007-08
TURNOVER
(in crores)16.80 37.59 77.85 105.36 116.36
PROFIT
(in crores)0.55 1.97 3.99 11.49 17.72
16
STANDING IN MARKET:
There are more than thirty manufacturers and Megawin has come up in the ladder from 28 th
position to 5th as on 2007-08. Main competitors are as Siemens, ABB, Areva, Crompton &
BHEL. The turnover has increased several folds. It was Rs.0.21 lakhs during 1992-93 and today
it is Rs.150.00 crores.
MARKET INFRASTRUCTURE:
Besides Head Office/Registered Office located at Salem (Tamilnadu) full fledged branches at
Chennai, Hyderabad, Bangalore, Kochi, Mumbai/ Calcutta/New Delhi/ Pune / Nagpur etc. and
Authorized Representatives at all State Capitals.
PRODUCTS USAGE:
The products manufactured are generally used in Distribution / Protection of Electricity as
Control device to protect Transformers and Substations/Capacitors/Motors, etc. The products are
fully type tested at Government Recognized approved Laboratories such as Central Power
Research Institute at Bangalore and Bhopal besides IIT’s.
CUSTOMERS:
Almost all Electricity Boards, Public/Private Utilities, Mines, Big Industrial Houses, Multi Store
Buildings, Wind Mills, Water and Irrigation Projects, Steel/Cement/Chemical/Sugar and Textile
Industries/ IT Parks etc.
FUTURE OUTLOOK:
With Central/State Governments thrust on increased Power Generation, requirements/ Demand
and expected spurt in Industrial Growth, it is expected that the boom in the market for the
products manufactured by Megawin shall continue to grow upward in the years to come.
SAFETY MANAGEMENT:
The company has taken various safety initiatives to minimize the accident. These
initiatives have helped in creating a culture of safety in the plant and in improvement of
the safety parameters.
17
ENERGY, TECHNOLOGY AND FOREIGN EXCHANGE:
The company has taken various adequate steps by educating its staffs, workers and others
the need to conserve energy.
ENVIRONMENT MANAGEMENT
This company has taken various safety initiatives to minimize the pollution through
monitoring and disposal of waste materials. During the year, the company has taken
extensive steps to improve greenery in the plant premises.
3.2 MEGAWIN’s VISION & MISSION
"A world class integrated SWITCHGEAR MANUFACTURER”
To realize this vision, MEGAWIN has drawn up a detailed Corporate Plan which represents
the company's collective optimism and enthusiasm, inspired by a glorious past, a vibrant
present and a brilliant future. The Plan has been prepared in-house in consultation the
committed, competent and confident members of the MEGAWIN family. The road map that
has been charted out was after a thorough scan of the strengths and weaknesses within the
organization as well as opportunities and threats in the environment.
MEGAWIN MISSION:-
“Develop and provide related products and services at competitive prices with innovative and
eco – friendly technologies and contribute to society"
MEGAWIN’s CORE VALUES:
Business ethics
Customer focus
Initiative & speed and Organizational pride
18
3.3 FUNCTIONS OF MEGAWIN:
Their main function is distribution of power generation equipments & starters and
control and electrical lines.
Final product: Panel board/ switch board and porcelain clad, circuit breakers
Circuit breakers- the main function of circuit breakers is to get a single line and dividing
into multiple lines
Various sub-components are needed for the production of the final product such as
i) Vacuum interrupters
ii) Load break switch
iii) Insulators
iv) Transformers
v) Relays
vi) HT/HRC fuses
vii) Meters
All these sub-components are produced by them since they are needed more in number
except certain components like Insulators since they are needed less in number.
It has an individual fabrication unit where the sheet metals are fabricated, further it is
passed on the painting process and then assembling is done. Testing & packing is done
and later dispatched.
RAW MATERIALS
The raw materials are mainly purchased within India & sometimes from China
Sheet metal, rods. Channels
Copper bars
19
Wires paint
Switches/ cables
Switchgear materials
Other ferrous and non-ferrous metals
3.4 PRODUCT PROFILE
COMPONENTS OF SWITCHGEAR
Switching and Interrupting Devices: used to turn the power on or off. Include circuit
breakers or disconnectors.
Control Devices: used to check and/or regulate the flow of power
Metering Devices: used to measure the flow of electric power
Protective Devices: used to protect power service from interruption, and to prevent or
limit damage to equipment
Indoor Switchgear: This product category includes all metal-clad/metal-enclosed
switchgear with circuit breakers (vacuum or SF6 circuit breakers) and vacuum contactors.
Outdoor Switchgear (kiosks): All metal-clad/metal-enclosed switchgear in a
weatherproof enclosure (kiosks) suitable for outdoor application.
Air Circuit Breaker: A circuit breaker with air as the arc-quenching medium.
Molded Case Circuit Breaker (MCCB): An MCCB is a circuit protection device whose
current-carrying parts, mechanisms, and trip devices are completely enclosed within a
molded case of insulating material.
Miniature Circuit Breaker (MCB): A small trip switch operated by an overload and used
to protect an electric circuit, especially a domestic circuit as an alternative to a fuse.
Residual Current Device (RCD): This protects against indirect contact electric shock. It is
designed to detect such a residual current (an earth leakage current), to compare it to a
reference value, and to open the protected circuit when it exceeds the reference value.
RCD is also known as earth leakage circuit breaker (ELCB) or residual current circuit
20
breaker (RCCB). The product definition also includes RCCB with over current protection
(RCBO).
VARIOUS PRODUCTS OF MEGAWIN:
CAPACITOR SWITCH WITH MAGNETIC ACTUATOR (indoor/ outdoor):
Salient features:
Very compact.
Fewer components
Fewer linkages & maintenance free.
Mechanical / electrical life more than 200000 operations.
Directly coupled linear motion
Fully type tested
Easy to install
Self – powered, RVT input
CAST RESIN TRANSFORMERS
Salient features
Highly compact
Devoid of oil; fire hazard eliminated
Finds excellent application in high rise buildings
Safe, self extinguished
High impulse and high short circuit strength
21
Applications
Theatres
Residential buildings
Hospitals
Commercial complex
Air ports
Mines
Design features:
H.V & L.V windings are made up of electrolytic copper conductors covered with
inorganic thermally upgraded insulating material(nomex) which can withstand temperature up to
220 C and which has good mechanical strength.
PORCELAIN CLAD OUTDOOR VCB TYPE MSP 12/36:
Salient features:
Simple in construction and easy to operate
Factory assembled porcelain pole part and operating mechanism so that no site
adjustment is required and reduction in erection time
Fully type tested as per IEC-62271-100/ IS-13118.
Restrike free, suitable foe capacitor switch application
Suitable for rapid auto- reclosing duty
Negligible maintenance
Very high reliability
22
TRIP CIRCUIT SUPERVISION RELAYS-MVAX
Salient features
They ensure positive action without chatter
Provide choice of pre-closing and after supervision
Robust and designed for trouble free operation
CICULATING CURRENT RELAY-MCAG 14
Features
Compact design
Dust proof enclosure
High stability on external faults
Trouble free and strong construction
Application
Protection for AC machines, reactors, auto transformers and bus bars
Earth fault protection of generators and transformers
3.5 FUNCTIONS OF VARIOUS DEPARTMENTS
MARKETING FUNCTION:
They mainly market the products through liaison agents and dealers. They conduct
meeting once in two months in order to promote their marketing functions.
They discuss about the sales of their products and their targeted customers. They do
across the table presentations, conduct seminars in order to promote their product.
23
Their main competitors are Areva, Siemens, ABB, Crompton & BHEL. They
compete with them by cutting down the margins, by providing quality products and
ensuring prompt delivery.
Areva, Siemens, and other major competitors are large scale industries and they
serve worldwide and not dependent on the government
They have extended to provided their services to textile units also through reference
contractors.
They have taken contracts from Salem Steel Plant, L & T (Larsen & Toubro),
NTPC.
They participate in ELECRAMA FAIR conducted once in two years. Their major
customers are almost all Electricity Boards, Public/Private Utilities, Mines, Big
industrial houses, Windmills, etc.
Their turnover has increased drastically. It was Rs.0.21 lakhs during 1992 – 93 and
today it is Rs.150.00 Crores.
Their main customers are all state governments.80% of their products are sold to the
government on tender basis.
The remaining 20% of their products are sold to the private clients.
About 60% of switchgears is contributed by first 4 clients (Siemens, Areva, ABB,
Crompton).
10- 15% is contributed by MEGAWIN
10% is contributed by BHEL
Remaining is contributed the other 25% producers of switchgears.
24
MARKET ANALYSIS – An Overview
Whether you are starting a new business or launching a new product, conducting a marketing
analysis is the first step in determining if there is a need or audience for your idea. Knowing the
market's needs and how it is currently serviced provides you with key information that is
essential in developing your product/service and marketing plan. Too often, businesses spend
thousands of dollars launching a "new" idea with a limited market because of competition. The
owner is forced to reevaluate his strategy and determine if there is room for another player.
Although the quality of the product is critical, your development of the best product on the
market will not necessarily correlate with the most sales. Up to 50 percent of a product's price
can be for marketing. The company who wins the marketing game generally will capture the
larger share of the market. Conducting a market analysis will help to:
Prepare to enter a new market
Launch a new product/service
Start a new business
MARKET OVERVIEW
Government Funding and Power Capacity Additions Open the Doors for Switchgear Manufacturers
To meet the objective of "power for all" in India by 2012, an estimated additional power capacity
of 100,000 MW is required, which would mean that the efforts of the past fifty years have to be
replicated in another ten years. As the Indian power sector strives hard to plug the huge demand-
supply gap caused by rapid economic growth, new opportunities are presenting themselves for
switchgear manufacturers. For instance, the poor financial health of the State Electricity Boards
(SEBs) due to huge transmission and distribution (T&D) losses - around 28 percent to 35 percent
of the generation capacity - has prompted the Government of India to come out with various
policies such as ARDRP.
"The APDRP scheme provides funding under two components - incentive and investment, and
many SEBs have evinced interest in the scheme, engaging private sector participants to renovate,
25
modernize, restructure, and upgrade the T&D infrastructure," says the analyst of this research
service. "This has not only paved the path for private sector participation in the state-owned
utilities, but also generated interest among the participants to drive home this advantage." Thus,
higher energy requirements coupled with the shift of focus from generation to T&D, hence,
reduction of T&D losses, are likely to drive the switchgear market.
PROCUREMENT FUNCTIONS:
Every firm, be it a manufacturing concern or a trading concern has to buy something either to
trade it as it is or add some value to it. In both the cases the firm is buying and selling the
goods or services generated. The value generated between two points in the value chain is the
profit generated by that particular chain partner. These values being terms of place, time,
quantity of form etc. In the case of MEGAWIN, MEGAWIN buys sheet metal, wires, copper
bars and other capital goods and converts it into panel boards, load breakers, etc. Since the
raw material is changing form during the value addition process hence MEGAWIN is a
manufacturing firm. For every manufacturing concern, the raw material is the cost center
after the initial expenditure relating to the capital goods. It is also the most important factor
affecting the quality of the product and in case of MEGAWIN the performance. A low-grade
sheet metal may not only reduce the efficiency of the plant but may also make it malfunction
or might even lead to a sudden breakdown. Hence the plant but may make it malfunction or
might even lead to a sudden breakdown. Hence the right quality of ferrous & non-ferrous
metal is not only desired but is required.
Similarly the plants and equipment required to produce the finished product is also to be
procured and hence one more purchasing comes into picture. Once the plant is erected and
commissioned, during its normal operations the plant may require some spare parts as well as
some replacement and maintenance parts. Hence for that also the firm has to maintain a
constant supply. So for all this purchase system is another big question. To get an appropriate
purchase system structure we must identify the actual requirement MEGAWIN has some
plants as old as ten years old, which are using a very aged or aging technology; on the other
hand some of its requirement for these two plants will obviously be different
26
The purchasing procedures at MEGAWIN should be such that it can take care of such
extreme differences and provide both the locations with the required material at the right
time. If MEGAWIN procure all the material through a centralized purchasing division which
will club all the requirements of various projects together and order on the basis of his
clubbed requirement, of various projects together and order on the basis of the clubbed
requirement, then MEGAWIN can achieve economies of scale as the quantity bought will be
significantly high .
Procurement Steps:
Procurement life cycle in modern business usually consists of the following steps:
1. Information Gathering: If the potential customer does not already have an established
relationship with sales/ marketing functions of suppliers of needed products and services (P/S), it
is necessary to search for suppliers who can satisfy the requirements.
2. Background Review: References for product/service quality are consulted, and any
requirements for follow-up services including installation, maintenance, and warranty are
investigated. Samples of the P/S being considered may be examined, or trials undertaken.
3. Negotiation: Negotiations are undertaken, and price, availability, and
customization possibilities are established. Delivery schedules are negotiated, and a contract to
acquire the P/S is completed.
4. Fulfillment: Supplier preparation, shipment, delivery, and payment for the P/S are completed,
based on contract terms. Installation and training may also be included.
PRODUCTION FUNCTION:
Megawin Switchgear, established in 1987 having its manufacturing works located in the steel
city of Salem in southern part of India. They offer a wide range of medium voltage electrical
substation products, completely designed, developed and type tested in accordance to relevant
standards at CPRI and other independent recognized testing stations. The products are
dependable & reliable with specific emphasis to the client needs. They have their presence in the
domestic & international markets and it is our constant endeavor to offer quality products .
27
They follow the IS (INDIAN STANDARDS) & IEC in the manufacturing process.
They have different quality control department for each of their products.
The workers would mostly find the defaulted products (components) while installing.
Later on the supervisor takes in charge for the products to go under various testing
process.
They mostly produce indoor components, very few outdoor components produced as it
would lead to the expansion of the units. The main advantage is that the sub
components are produced by themselves and they are not dependent on the third
parties.
About 80% - 85% they are not dependent on outsiders. 15% -20% they buy few
components from outside, since they are needed less in number. Such components
cannot be produced by them as the cost incurred in the production is heavy.
INFRASTRUCTURE:
They have a robost infrastructure in place. Most of their components used in their
finished products are made of steel, copper, aluminium or epoxy raw materials which
are ultimately machined in-house. There are several machines installed for sheet metal
bending, shearing, punching, drilling and so on. Jigs & Fixtures are made in-house for
assembly.
Other facilities include autoclave for curing of epoxy components. Sand Blasting & 7-
tank process for sheet metal processing. Powder coating plant using epoxy paint for
painting the panels both interior and exterior.
The in process inspection is carried out in accordance to the quality assurance plan.
The testing facility covers oscilloscope for analyzing the breaker parameters like
opening/closing speed, opening/closing time, contact/mechanism over travel, High
Voltage Test Kit, Milli volt drop test kit, tongue tester, avometer, digital vernier, no go
gauges, micrometer, 2kV tester for control circuit test. P.D measurement kit, CT /PT
testing kits, Fuse & Relay testing kits.
URE drafted with the help of cutting edge technologies.
28
Megawin has a team of trained engineers/technicians who have hands on experience
and knowledge in meeting the service needs.
QUALITY POLICY/PROCESSES
Reliability of your equipment is our Obligation.The products undergo stringent in
process quality check as well as final inspection. Every product manufactured is routine
tested after assembly to the relevant standards.
Propagating quality management systems by way of formulating implementing and
monitoring the improvement plans with total focus on the internal as well as the
external customer satisfaction. It is also responsibility of the task force to bring about
the investigation and preventive action on critical quality issues and report the same to
the top management and take necessary corrective action.
29
MANUFACTURING PROCESS
STAGE -1
30
PCVB BOX & HORIZONTAL MECHANICAL BOX RECEIVED FROM FABRICATION
QC CHECK
ACCEPTED
RETURNED TO
FABRICATION
QC CHECK
REJECTED
REJECTED
ACCEPTED
QC CHECK
ACCEPTED
REJECTED
ASSEMBLY SECTION
PHOSPHATING (7 TANK PROCESS)
POWDER
COATING
RETURNED TO 7-
TANK PROCESS
RETURN POWDER
COATING
STAGE-2
31
CORK SHEET FIXING
IN PCVCB BOX TOP
HORIZONTAL MECH. FIXING
TOP ON BOX
VCB ASSY. RECEIVED FROM
VCB ASSEMBLY
VCB ASSEMBLY QC . CHECK
ACCEPTED
MAIN SHAFT ASSEMBLY FIXING IN HORIZONTAL MECHANICAL BOX
TOP TRAY FIXING IN
HORIZONTAL MECH. ASSY.
REJECTEDRETURN TO VCB
ASSEMBLY
STAGE -3
32
POLE PART COMPONENTS RECEIVED FROM STORES
QC CHECK OF ALL COMPONENTS
ACCEPTED
RETURNED TO
SUPPLIERS
QC CHECK
REJECTED
REJECTED
ACCEPTED
MANUAL OPERATIONAL
CHECK 50 OPERATIONS
ACCEPTED
REJECTED
WIRING BOARD FIXING
POLE ASSEMBLY
NITROGEN GAS FILLING
RETURNED TO
SUPPLIERS
ALIGNMENT
CHECK
WIRING
POLE FIXING ON THE HOR. MECH. ASSEMBLY
STAGE -4
33
ELECTRICAL OPERATION
CHECK
ACCEPTED
HIGH VOLTAGE, CONTACT RESISTANCE, TIMINGS AND
OTHER CHECKS
REJECTIONWIRING CHECK
HOR. MECH,COVERS,DOORS & GRAND PLATE FIXING
PACKING & DESPATCH
HUMAN RESOURCE
Human resources is a term used to describe the individuals who comprise the workforce of an
organization, although it is also applied in labor economics to, for example, business sectors or
even whole nations. Human resources is also the name of the function within an organization
charged with the overall responsibility for implementing strategies and policies relating to the
management of individuals (i.e. the human resources). This function title is often abbreviated to
the initials 'HR'.
Human resources is a relatively modern management term, coined in the 1960s. The origins of
the function arose in organizations that introduced 'welfare management' practices and also in
those that adopted the principles of 'scientific management'. From these terms emerged a largely
administrative management activity, co-coordinating a range of worker related processes and
becoming known, in time as the 'personnel function'. Human resources progressively became the
more usual name for this function, in the first instance in the United States as well as
multinational corporations, reflecting the adoption of a more quantitative as well as strategic
approach to workforce management, demanded by corporate management and the greater
competitiveness for limited and highly skilled workers.
MEGAWIN’S EMPLOYEES:
MEGAWIN recognizes that the success of its operations is dependent to a large extent on the
commitment and support of its workforce. Employment decisions are made with no reference to
religion, caste, sex or any non-job related handicap. Terms and conditions of employment are
competitive.Employees display the highest level of ethics and integrity in every sphere of
activity and they abide by the rules and regulations of the organization.
Every employee is given an assignment that best suits the employee’s capabilities and is
sufficiently empowered to function at an optimal level. Adequate opportunities are provided to
the workforce to upgrade their skills. Every employee is entitled to equal consideration for any
open job opportunity within the Company and due importance is given to Succession Planning.
34
Innovation and well-reasoned risk taking are supported, but performance is always demanded.
Employees do not have rights or lien over any inventions that arise in the course of employment.
Suggestions from the workforce for the betterment of processes and practices are always
welcomed.Employees are expected to devote their full time attention to the business of the
Company and not take on any competing assignments either directly or indirectly without proper
authorizations.
Company property – equipment and intellectual property rights such as patents, trademarks,
copyrights, designs, strategies, plans, trade secrets and similar items that are not in the public
domain – should be used only in the course of and for Company business, with proper care and
safeguards.
Solicitation or acceptance of gifts is strictly forbidden except in cases where items are gifted with
no expectation of business or personal gain. The payment or receipt of bribes is prohibited.
They comply with all labor related legislations of the Central and the State Governments, and, in
particular, will neither employ nor advocate the employment of child labor or forced labor.
Employees are provided with a safe and healthy work environment.
RECRUITMENT & SELECTION:
Recruitment is Searching for, and obtaining, potential job candidates in sufficient
numbers and quality, and at the right cost, for the organisation to select the most
appropriate people to fill its jobs. (Kramar et al 1996)
Selection is the process of gathering information for the purposes of evaluating and
deciding who should be hired, under legal guidelines, for the short and long term interests
of the individual and the organisation.
They follow both internal & external recruitment. They mostly recruit the
employees through word of mouth and those with excellent technical skill.
They also recruit the persons through internet, private agencies and advertisement.
35
They select the persons through interviews based on their capabilities, knowledge
and skill .
DISCIPLINARY FUNCTION:
Wide range of procedures and steps in dealing with workplace conflict
Informal meetings
Formal meetings
Verbal warnings
Written warnings
Grievance procedures
Working with external agencies
TRAINING & DEVELOPMENT:
Provides new skills for the employee
Keeps the employee up to date with changes in the field
Aims to improve efficiency
Enables the employees to develop their skills and become more efficient.
BENEFITS TO EMPLOYEES:
The staffs of MEGAWIN are provided with various benefits which enables them
to work more effectively towards the success of the organization.
They are provided with leave salary.
Staffs who hail from places other than Salem are provided with free
accommodation.
Manager cadre persons are provided with cars .
No labor unions are formed in the company. All their grievances are handled
gently.
36
FINANCIAL MANAGEMENT:
Financial management can be defined as the management of flow of funds in a firm and it deals
with the financial decision-making of the firm. It is concerned with the overall managerial
decision making in general and with the overall management of economic resources in
particular.
FINANCIAL ANALYSIS
Financial analysis is separating facts according to some definite plan, arranging them in a group
according to certain circumstances, and then presenting them in a convenient and easily read and
understandable form. Moore & Jacdicke have defined financial analysis as “a process of
synthesis and summarization of financial and operative data with a view to getting an insight into
and interpretation of financial statements as a technique of X-raying financial position as well as
the progress of a company”.
ANALYSIS OF FINANCIAL STATEMENT:
Analysis of Financial Statement (AFS) refers to the process of the critical examination of the
financial information contained in the financial statement in order to understand and make
decisions regarding the operation of the firm. The AFS is basically a study of the relationship
among various financial facts and figures given in a set of financial statement. The complex
figures as given in these financial statements are broken into simple and valuables elements and
significant relationship are established between the elements of the same statement or different
financial statement. This process of dissection, establishing relationship and interpretation
thereof to understand the working and financial position of a firm is called the AFS. Thus, AFS
is the process of establishing and identifying the financial weaknesses and strength of the firm. It
is indicative of two aspects of a firm i.e. profitability and financial position of the firm.
37
OBJECTIVES OF THE ANALYSIS OF FINANCIAL STATEMENT:
The objective of AFS is to understand the information contained in financial statement with a
view to know the weaknesses and strength of the firm and to make a forecast about the future
prospects of the firm. The objective of AFS can be identified as:
i) To assess the present profitability and operating efficiency of the firm as a whole as well as for
its different departments.
ii) To find out the relative importance of different components of the financial position of the
firm.
iii) To identify the reasons for change in the profitability/financial position of the firm.
iv) To assess the short term as well as long term liquidity position of the firm. Procurement is the
acquisition of goods or services at the best possible total cost of ownership, in the right quantity
and quality, at the right time, in the right place for the direct benefit or use of the governments,
corporations, or individuals generally via, but not limited to a contract.
v) Simple procurement may involve nothing more than repeat purchasing. Complex procurement
could involve finding long-term partners - or even 'co-destiny' suppliers that might
fundamentally commit one organization to another. A key question in procurement is what to
buy, given a limited budget. If good data is available it is good practice to make use of economic
analysis methods such as cost-benefit analysis or cost-utility analysis.
ACCOUNTING POLICIES & NOTES ON FORMING PART OF ACCOUNTS:
ACCOUNTING POLICIES:
They accompanying financial statements are prepared on historical cost basis.
REVENUE RECOGNITION:
The company generally follows mercantile system of accounting and recognizes income
and expenditure on accrual basis.
Sales and services are accounted on accrual basis when the sale of goods or services is
completed.
38
Sales exclude sales tax, value added tax and excise duty.
FIXED ASSETS:
Fixed assets are stated at historical cost of acquisition net of cenvat credits, including
installation, direct attributable costs less accumulated depreciation.
DEPRECIATION:
Depreciation is provided on written down value method at the rates prescribed under
schedule XIV of the Companies Act,1956 on a prorate basis according tot the number of
days the assets are put to use.
Assets purchased during the year where the actual cost does not exceed Rs.5000 are
depreciated at the rate of 100% in the year of purchase.
INVESTMENTS:
Long term investments are stated at cost.
Provision for diminution in value of long term investments is made, if the diminution is
other than temporary.
DIVIDEND:
The directors have not recommended payment of dividend to the equity shareholders in
order to conserve funds for future expansion.
They decided to give dividend only after they achieve a turnover of Rs.250 crores .
FIXED DEPOSITS:
The Company has not accepted any deposit within the meaning of Section 58 A of the
Companies Act,1956 and the rules framed there under.
39
COMPARATIVE BALANCE SHEET
SOURCES OF FUNDS 31.03.2009 31.03.2008 31.03.2007 31.03.2006
Share Holders Funds
Capital
Reserves & surplus
50200000
279096988
50200000
194421127
50200000
80684373
50200000
6167876
Loan Fund
Secured fund
Unsecured fund
447498591
0
332682794
342629
239443447
4631428
154576542
97261
Deferred tax liability 312076 28927594 18695848 0
808003215 606574144 393655096 211041679
APPLICATION OF FUNDS
Fixed assets
Gross block
(-)depreciation
321037503
53889521
266998294
27359553
217794521
7681315
71894083
1114185
Net block 267147982 239638741 210113216 70779898
Investments 2500000 2500000 - -
Current assets, loans,advances
Inventories
Sundry drs.
Cash & bank balance
Loans & advances
221137698
289071955
74677231
144930702
99993199
287584269
72466621
158244174
32992734
259901483
40574586
61869025
73219759
225792777
23222810
35425791
(-) Current Liabilities &
Provisions
729817586
191545760
618288263
254019674
395337828
212046168
357661137
218502861
538271826 36426859 183291659 139758276
Miscellaneous expenditure 83407 166814 250221 333628
Deferred tax assets - - - 769877
808003215 606574144 393655096 211041679
40
CHAPTER-4
ANALYTICAL REFLECTONS
4.1 RATIO ANALYSIS
ABSOLUTE CURRENT RATIO:
Absolute liquidity is represented by cash and near cash items. Hence, in the computation of this
ratio, only the absolute current assets are compared with current liabilities.
CurrentAsset
Current Ratio = ----------------------------------
Current Liabilities
ABSOLUTE CURRENT RATIO
YEAR Absolute Current
Asset( Rs. In Crs)
Ratio Liability Absolute Current
Ratio
2006-2007 38.73 35.92 1.08
2007-2008 61.40 52.72 1.16
2008-2009 72.98 58.13 1.26
Table 1
41
INTERPRETATION:
The ratio in the year 2006-2007 the ratio was 1.08. But the next year 2007-2008 the ratio is
increased to 1.16. Finally the ratio also increases in the year 2008-2009 the ratio was 1.25.This
reflects a steady growth of this company.
ABSOLUTE CURRENT RATIO
2006-2007 2007-2008 2008-20090.95
1
1.05
1.1
1.15
1.2
1.25
1.3
Figure 1
WORKING CAPITAL TURNOVER RATIO:
This ratio indicates whether or not working capital which relates to current assests such as cash ,
bank, bills receivable, sundry debtors, inventories, marketable securities , prepaid expenses and
current liability namely bills payable, sundry creditors, bank overdraft, provision for
taxation,accrued expenses has been effectively used in making sales.
NetSales
Working Capital Ratio = ----------------------------------
Net Working Capital
42
WORKING CAPITAL TURNOVER RATIO
Year Net Sales Net Working Capital Working Capital
Turnover Ratio
2006-2007 105.36 2.81 37.49
2007-2008 115.25 8.69 13.28
2008-2009 90.95 14.85 6.12
Table 2
INTERPRETATION:
The above table indicates the working capital turnover ratio of the Megawin Switchgear Ltd in
the year 2006-2007 the ratio was 37.49. The year 2007-2008 the ratio was 13.28 and the year
2008-2009 the ratio was 6.12.
WORKING CAPITAL TURNOVER RATIO
2006-2007 2007-2008 2008-20090
5
10
15
20
25
30
35
40
Figure 2
43
TOTAL ASSET TURNOVER RATIO:
This ratio measures the overall performance and activity of the business organization .
Sales
Total Asset Turnover Ratio = -----------------------------
Total Assets
Total Assets Include:
Current asset (cash, bank, sundry debtors, bills receivables, prepaid expenses ) + Fixed asset
( plant & machinery ,buildings, furniture)
TOTAL ASSET TURNOVER RATIO
Year Sales Total Assets Total Assets Turnover
Ratio
2006-2007 105.36 60.56 1.74
2007-2008 115.25 86.06 1.34
2008-2009 90.95 99.95 0.91
Table 3
INTERPRETATION:
The total turnover ratio is one of the most important ratios. This results in the financial
performance of the company. If the ratio is high the company is performing good.
The above table indicates the Total Assets turnover ratio was 1.74 in the year of 2006-2007. But
the ratio decreased in the year 2007-2008 to 1.34. In the next year 2008-2009 the ratio was
further decreased to 0.91, due to the decrease of the sales when compared to previous year.
44
When the company ‘s total assets turnover is high the company’s financial position was
effective.
TOTAL ASSET TURNOVER RATIO
2006-2007 2007-2008 2008-20090
0.20.40.60.8
11.21.41.61.8
year
ratio
Figure 3
DEBTORS TURNOVER RATIO
Debtors normally include both debtors and bills receivable and represent the uncollected portion
of credit sales. Receivables constitute an important component of current assets and therefore the
quality of receivable to great extent determined the liquidity of the firm.
CreditSales
Debtors Turnover Ratio = -----------------------------
Average Debtors
45
Opening Debtors + Closing Debtors Average Debtors = ------------------------------------------------------ 2
DEBTORS TURNOVER RATIO
Year Credit Sales Avg.Debtors Debtors Turnover
Ratio
2006-2007 105.36 14.12 7.46
2007-2008 115.25 27.37 4.21
2008-2009 90.95 28.83 3.15
Table 4
INTERPRETATION:
The above table represent debtors turnover ratio of Megawin Switchgear Ltd. The ratio in the
year of 2006-2007 was 7.46. But the ratio decreased in the year of 2007-2008 to 4.21. Further the
ratio decreased to 3.15 in the year 2008-2009.
DEBTORS TURNOVER RATIO
2006-2007 2007-2008 2008-2009
0
1
2
3
4
5
6
7
8
Figure 4
46
FINANCIAL HIGHLIGHTS:
PARTICULARS 31.03.2009 31.03.2008
Gross Sales & Services 10150.57 13705.35
Less : Excise Duty 1054.93 2068.86
---------------------------------------------
Net Sales & Services 9095.64 11639.49
Other Income 231.93 281.88
9326.68 11918.37
Profit before Depreciation, interest & taxes 2087.44 2372.87
Less: Finance Charges 547.70 383.48
--------------------------------------------
Profit before Depreciation 1539.74 1989.39
Less: Depreciation & Miscellaneous Expenditure w/o 264.36 217.39
---------------------------------------------
1275.38 1772.00
Less: Provision for income-tax, FBT & Deferred Tax 439.78 627.95
--------------------------------------------
Profit after Tax 835.60 1144.05
Less : Prior Period Items 1.30 6.69
--------------------------------------------
Profit for the year 834.30 1137.36
47
INTERPRETATION:
The financial year 2008-2009 has witnessed a downward trend in Sales, Operating Profit and Net
Profit due to general global recession and other related factors. The directors hope to achieve
even further better results in future.
4.2 SWOT ANALYSIS :
The MEGAWIN Switchgear Industry - STRENGTHS
The Indian electrical equipment industry comprising of multinationals, large, medium and
small players is quite capable of producing, supplying and exporting a wide variety of
electrical equipment including switchgear and control gear items needed by the expanding
industrial and power sector.
India’s Switchgear industry is fully developed and mature.
This industry sector manufactures the entire voltage range from 240 V to 800 KV. The
technology level is Contemporary.
The major technological factors in the market are safety, maximization of efficiency and
reliability.
Quality of the switchgear gives a market edge for most of the suppliers. Dedicated
commitment to the overall quality of the switchgear, prompt after sales service and
support has been determined as a mandatory strategy for success.
The industry has tried to reduce the adverse impact of internal factors by cost cutting,
improving productivity and keeping up to date in new technologies.
The industry is competitive in the field of design and engineering, as the skill sets
available in the country are relatively less expensive.
Per capita consumption of energy being relatively low, the growth potential for this
industry in medium and long term is high.
The ‘Made in India’ brand is gaining more currency/trust in the global markets.
New Developments/Trends in the
Switchgear Industry
The domestic switchgear industry continues to innovate and upgrade its products to meet
the evolving/future needs of its customers with the following products/trends:
48
Low Voltage
Increased acceptance of electronic releases in circuit breakers
Embedded Intelligence and communication enabled
Improved materials for cost saving, environmental reasons and ROHS
Movement from motor starters to submersible pump controllers
Soft Starters Increased use of modular device in building electricals
Vacuum contactors for higher ratings
Medium Voltage
More use of magnetic actuators
Field for Life-Maintenance free (IEC- M2 duty -
10000 Operations)
Shift from Electromagnetic to Numerical relays
Shift from Electrical sensors- CT/PT to electronic
sensors.
Ring Main Units
High Voltage / Extra High Voltage
Compact GIS
Compact AIS
Compact switchgear
Controlled switching
Solid State switchgear
Intelligent switchgear
VCBs with higher ratings
WEAKNESS:
Switchgear industry has to majorly depend on the
financially weak EBs for its sales.
Uncertainty and slow pace of reforms
Increasing competition from unorganized sector
and imports
Macroeconomic challenges which constrain public
and private funding
49
Low investments in R&D,
Integration/Assimilation of new technologies
into development of new products in the sector
needs improvement
OPPURTUNITIES:
Generation capacity is expected to be argumented by around 78,577 MW under Eleventh
FiveYear Plan (2007-2012). More than 60,000 MW under construction.
The T & D network expansion
The Government is focusing on increasing the penetration of power supply in villages.
Schemes like APDRP and RGGVY are providing an excellent
opportunity for the LV and MV under, “Electricity for All” initiative
Expansion of key industry sector like cement,steel, petrochemicals, telecom and others
Expansion of Infrastructure like telecom, railways, airports, ports, roads, hospitals etc.
Replacement and retrofitting programmes
THREATS:
Some of the threats faced by the Indian Switchgear Industry are:
Underutilization of installed capacity
Lack of HV switchgear test facilities in the country
Increasing competition from unorganized sector in low end/low tech items/imports in
LV segment and project imports
One sided contracts by the user industries/ Price
Variation contracts not accepted by many users
Improper procurement planning/bunching of order
CHAPTER-5
OBSERVATIONS
50
From the study I observed that the company has the widest range of products in the HT
Switchgear segment (Indoor & Outdoor) ranging from 3.6 KV to 36KV Vacuum
Circuit Breakers, Load Break Switches, Vacuum Contractors , Off Load Isolators, Cast
Resin Transformers, HT HRC Fuses, Relays and allied products.
The switchgear products are manufactured as per IS/IEC standards as required by the
purchaser which ensures right from the quality checking or raw materials to
manufacturing process.
Aiming at consistent growth with simultaneous technical advancement to fulfill the
customer’s need time to time, they have set up a fully equipped research and
development center headed by well qualified experienced engineers.
The company believes in and scrupulously follows the trends of corporate governance
and complies with all applicable mandatory accounting standards laid down by ICAI
and ROC prescribed procedures.
More than half of the capital belongs to debt. So it may have chances of creditors
participating management decision. Therefore minimize the debt position in capital is
very much necessary
The company has achieved a turnover of Rs.116.36 crores, during the year ended 2007-
2008, as against the projected figure of Rs.120.00 crores. Considering the present market
scenario and the global slowdown, they are confident of achieving a turnover of Rs.100
crores for the year 2008-2009 and Rs.150.00 crores in the year 2009-2010. They expect
the trend to improving the coming years. Especially, they have taken approval from
NTPC who are going in the many Ultra Mega Power Projects, where there is a huge
requirement for HT Switchgear units being manufactured by them. Their products have
been approved and well accepted by almost all the Electricity Boards, Coal Mines, Water
Boards and leading Private Institutions like L&T, SPIC, Subash Projects,etc.
EXISTING SYSTEM
51
The company’s philosophy on corporate governance is delineated below:
Effectiveness measured by the quality of its leadership resulting in best
performance.
Accountability through openness, public disclosure & transparency of activities.
Conforming to high stands in financial policies, internal controls, constant
attention towards high quality of its products and continuous up gradation of skill.
Responsibility and responsiveness to stakeholders including shareholders,
investors, customers, employees, lenders and government agencies.
Sustaining a healthy and ever improving bottom line
Upholding the spirit of social responsibility
Create a management team with entrepreneurial and professional skills.
CHAPTER-6
CONCLUSION
Compared to other Switchgear Manufacturers, they have introduced a variety of new
products, indigenously developed in their manufacturing range like
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Cast resin dry type transformers / Unitised packages substations
Auto closures
Control and Relay Panels
Vacuum Interrupters
In view of development of modern residential complexes, the demand for package
substations with Cast resin dry type transformers will go up exponentially.
Most of the electricity boards are opting for automation at present and hence we expect
a reasonable increase in the requirement of Auto Reclosures.
With more and more substations on the anvil, they are also expecting a very good
business through the supply of Control and Relay Panels.
They have commenced the production of Vacuum interrupters from their 3rd Unit.
Presently these vacuum interrupters are manufactured only by 3 companies in India,viz
Bharat Electricals Ltd., Crompton Greaves Ltd. and ABB Ltd. They are the 4th
indigenous manufacturer to commence production of Vacuum Interrupters. This in-
house capability will not only help them in maximizing their profits, but also will give
them an edge over other competitors and will help them capturing more business
opportunities.
They have already achieved a sales of Rs.63 crores up to December 2008 and with a
pending order book of 55 crores, they are sure to achieve Rs.100 crores this year.
More than Rs.50 crores are pending finalization in the course of next three months from
customers like Rajasthan Electricity Board, Neyveli Lignite Corporation Limited ,
Maharashtra State Electricity Board, Madhya Pradesh Electricity Board, Jammu &
Kashmir Power Development Board, Kerala State Electricity Board ,etc,.
Apart from this , they expect major orders from their regular customers and also from
the forthcoming tenders. With this, they are confident of achieving a turnover of Rs.150
crores in the year ending 2010.
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A lot of people in the power sector and infrastructure are underway and huge volumes
of orders are expected from these sectors in the next few years. On the other hand, the
competition is also increasing, in lieu of the increased manufacturing infrastructure
created by major manufacturers.
The expansion of the firm is good and it has doubled its sales and profits in just
five years of time.
The sales have increased more than profit it shows that there is needed a proper
control over cost of goods sold.
It has taken approval from NTPC which has a huge requirement for HT
Switchgears.
Research is going on for its future products such as SF 6 Breakers.
It is going to construct an Erection commission as well as a new division is
going to be started in two years of time.
The overall performance of the concern is fine.
BIBLIOGRAPHY
http://www.megawinswitchgear.com
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http://www.switchgearindustries.com
megawin records
megawin manuals
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