Tolling - SIMPLEX COKE & REFRACTORY PVT. LTD. Simplex Coke.pdf · 2017-08-09 · TOLLING ....

Simplex Coke and Refractory Private Limited is incorporated on 04th day of April, 2011. The capacity of the LAM Coke plant acquired is

approximate 3,00,000.00 MTPA. LAM Coke manufacturing facility is situated at Bhachau, Gujarat by foreseeing the growth opportunities in

the end user industries of LAM Coke.

TOLLING

TOLLING :- BENEFITS ALL :- Beneficial to end customers like :- TATA, NIRMA, DCW, HZL, ET, HINDALCO, ETC.

:- Beneficial to importers/ traders as tolling agent like :- ADANI, SWISS SINGAPORE, SHIV SHIPPING, NOBLE, ETC.

:- Beneficial to Coke converter :- SIMPLEX COKE ( convertor )

DRACONIAN MARKET SCENARIO

Coke consumers feels that manufacturer charges them high prices even when they have purchase low price coal.

TOLLING 2 OPTIONS :- Option 1 :- Fix conversion charges Rs. 1600 / MT • Where coal prices and coke prices are fixed by Tolling agent. • Where coke prices can be pre-sold 50% on index basis and balance

50% on spot basis. • Customer should hedge on both situations.

Advisable in there formula is to book large quantity order at the time of booking shipment to hedge maximum benefits.

Option 2 :- • CONVERTOR buys coal on 15% cash margin. • Pay cash & buy in 3 months time from shipment. • Also CONVERTOR sells 60% material in the name of Tolling

agent, such that payment is directly received by Tolling agent such that more coal is released to convertor. Coke is sold on a commission to cover interest charges.

• Gives good turnover to Tolling agent on both side of coal & coke.

TOLLING ADVANTAGES & DISADVANTAGES OF BOTH OPTIONS :-

Option 1: – Advantages – 1) High Profit 2) High Up – side 3) Direct Manufacturing Experience 4) Greater Involvement 5) Asset is under their control 6) Market Presence Disadvantages – 1) High Risk of fluctuation of coal pricing Option 2 :– Advantages – 1) Good Turnover 2) Market Presence 3) Acting as both 3rd party LC provider & trader for coke 4) Low Risk Disadvantages – 1) Low Margin 2) No Manufacturing Tag 3) Asset not under control

SIMPLEX COKE & REFRACTORY PVT. LTD.

BUSINESS OPPORTUNITIES

ADVANTAGES TO THE TRADERS:

I. They are able to capture Large markets of coking coal Business which is untapped.

II. With new Govt. policies changing everyday, these people core losing Business , volumes & markets shaves. For example, Govt. buying imported coal is getting slow.

III. Pet Coke because of its high sulfur could get stopped by Govt. This can effect their Top & bottom line.

IV. 70% of the finished product can be tied up in advance with large corporate houses on index basis.

V. A trader is able to show case availability & excess to large infrastructure of coal capabilities of the plant on an Indian port for future expansion of business.

ADVANTAGES OF THE CUSTOMERS:

I. Much of the productivity & profits to the customers. II. Quick return on capital investment. III. Data mining helps marketing companies to build Models based on historical data which is

precisely responded to new marketing companies to approach targeted customers IV. By using Market based analysis, a store can have an appropriate arrangement in such a way

that customers can purchase buying coal together with pleasant. It helps vital co. to offer certain discounts which will attract more customers.

ADVANTAGES OF COAL TO OTHER COMPANIES:

I. Because the demand for coal continues to rise, employment will also increase, which means there will be no job shortage in the coal industry.

II. First off, coal extraction is not difficult, whether it is mined on the surface or underground. Between opencast mining (surface) and deep mining (underground), the former recovers 90% or more of the coal compared to the latter, which basically means that miners do not have to go deep in the earth all the time.

III. They just need large heavy equipment and explosives to expose the coal seams. It is also safe to store and easy to burn which, by the way, produces by-products that are useful for other industries or products.

SWOT ANALYSIS WITH DIFFERENT BRANDS

GLOBAL MET COKE IMPORTS

WIN – WIN SITUATION FOR ALL STAKEHOLDERS

:- There is a lack of trust between mining companies and Governments. - Governments believe that mines have massive wealth, steal ore or withhold taxes. - Mining companies complain that the long-term nature of their business and scale of investment is not understood. :- Lack of communication has led to an ‘imagination gap’ between the realities faced by mining operations and the perceptions of Government. - Not seen as a long term partnership, but a source of short term revenues for Governments. :- The overall health of the sector in Africa is intrinsically linked to local economies. - Provides long-term revenue, jobs and industrialization.

WIN – WIN SITUATION FOR SUSTAINABLE DEVELOPMENT

:- New strategy anchored on the concept of creating “shared value” through:- - Creating Value - Developing People’s Capabilities - Enhancing Resilience

:- Our goal is to create communities that:- - Enjoys a thriving local economy that offers gainful employment and higher economic returns to its members - Are safe, inclusive and treat all community members equally (regardless of sex, race, etc.) - Enjoys good access to strategic social infrastructure.

GLOBAL TRENDS IN COKING COAL SUPPLY

COKING COAL – FUTURE GLOBAL SCENARIO

INDIA’S DOMESTIC COKING COAL SCENARIO

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