Fibres 2009: (Fa & Md) 200 9

FIBRES 2009: (FA & MD) 200 9

Summer Internship Project at TATA STEEL FAMD Department Project based on FIBRES 2009: FERRO ALLOYS (FAMD) A report submitted towards the partial fulfillment of the requirement of the two years full- time Mater of Business Administration (International Business)

Project Developed & Submitted by: DURGESH KUMAR VIT BUSINESS SCHOOL, VELLORE www.vit.ac.in Regn no. 08MIB018 MBA (International Business) ACADEMIC SESSION 2008 -2010

Submitted to: Mr. Himanshu Tandon Project Guide VIT Business School

ACKNOWLEDGEMENT

This is a short note of thanks to all the employees at TATA STEEL, KOLKATA who have made contribution in the completion of this project. I express my sincere thanks to my project guide Mr. PRABHASH GOKARN and Ms. SUNITI KHASTIGIR.Durgesh Kumar VIT BUSINESS SCHOOL, VELLORE, TAMILNADU Page 1

FIBRES 2009: (FA & MD) 200 9The Suggestions and advices given by Mr. PRABHASH GOKAHRN (HEAD, FA & MD) was very helpful. I also extend my gratitude to Mr. R.K. DAS and Mr. WARIS AHMED, for their sincere assistance. I thank the HRM Dept. This training would not have been so smooth without the help of Ms BHAWAMA M RAJ and MR. SIDDHARTHA SHAH Last but not the least; I thank my college Management, Mr. B.ASOKUMAR, Mr. HIMANSHU TANDON and my friends who helped me to complete my training successfully.

ContentsTITLE PAGE NUMBER

Objective of FIBERS 2009 04 MethodologyDurgesh Kumar

07VIT BUSINESS SCHOOL, VELLORE, TAMILNADU Page 2

FIBRES 2009: (FA & MD) 200 9 Sources of information 07 Introduction of Tata steel FAMD division Standard input templates BISRA 28 Analysis of BISRA 35 XSTRATA Analysis of XSTRATA 47 OUTOKUMPU Analysis of OUTOKUMPU 59 Conclusion 67 54 40 08 11 21

FIBRES 2009: FERRO ALLOYSDurgesh Kumar VIT BUSINESS SCHOOL, VELLORE, TAMILNADU Page 3

FIBRES 2009: (FA & MD) 200 9OBJECTIVE OF THE PROJECT:

Tata Steel has faced with an increasingly dynamic business environment today. The rapid changes in the environment make it very important for companies to have a tough external perspective while formulating strategy or taking vital Decisions. It is in recognition of this truth that the Tata Group has decided to implement the term of FIBRES (Facts and Information Based Reverse Engineering of Strategy) a Common framework that will be used across group companies to regulate the process of competitive monitoring within its group. FIBRES are a unified process and Methodology developed on the basis of worlds best practices. It is a method to make sure that strategies are formulated only after gaining a thorough accepting of the competitive environment. The aim is to align the Companys strategy with the demands of its business atmosphere. FIBRES will guide companies by providing a basic framework that can be made to order by them to suit their specific needs. The objective of the project is to create databases of competitors, analysis, collating and taking strategic decisions which can help Tata steel in competitions. It will be an eye to the External World It will help companies to understand who, what, where, when and how of its environment. It will be systematic and principled program for collating and analysing the different competitive environment and business trends which will serve as a essential input to strategy formulation. This project will help at different levels in different ways to give vital inputs to move organisation smoothly.

At the Group Level To create a common framework To institutionalise the process of always monitoring the external

business environment

At the Organizational LevelDurgesh Kumar VIT BUSINESS SCHOOL, VELLORE, TAMILNADU Page 4

FIBRES 2009: (FA & MD) 200 9 To

line up the firms strategy with its external business environment. And hence gain a strong competitive advantage environment

To help the organization be positive with respect to its external

To convert the organizations implied knowledge into a common

pool of explicit knowledge This project will help us to understand different organisational skills, resources and on the whole capability. It will help to understand talent as well as different recruitment and retainment strategies. Information about present practices, capabilities and future direction. It will also help us to understand financial capability of all competitors in terms of access to their capital, financial position such as leverage, different deployment of funds, about capital investment levels, product costing.It will also help in identifying trends & opportunities in the business. It will give ability to shape market and identify weaknesses in competitors strategies. Thus objective of this project is to create a competitive intelligence which is going to help to track competitors moves and gain competitive advantages while doing business.

MethodologyFirst we have to collect fact and information from various internal and external sources about the competitors organisations. Then we have to compile the information in a systematic way which can be easy to understand about competitors. We have to do analysis of different information with available tools and techniques of managements. Then we have to form it in the form of intelligence through reverse engineering strategies. At last we have to take strategic decisions which will help Tata Steel to gain competitive advantages in the market and to predict the competitors behaviours.

Input Document TemplatesCompany profile: Owner of company, Board of directors and management, List of subsidiaries, Objectives of company, organisation structures, manpowerDurgesh Kumar VIT BUSINESS SCHOOL, VELLORE, TAMILNADU Page 5

FIBRES 2009: (FA & MD) 200 9Product and services: types of product, product features, product lines, production volumes, sales levels, turnovers, new product developments, franchise, capacity, market segmentations. Pricing: pricing list, future pricing considerations, pricing strategies, target customers and suppliers of competitors Financials: sources of cash, Balance sheet, revenues, cash and fund flows, taxes, CAGR. Legal considerations: mergers, joint ventures, acquisitions, government contracts, licence agreements, trademarks. Sources of information Internal sources: Internal databases, sales team reports, employees, group companies, etc. Company sources: Annual reports, website, brochures, advertisements, press releases, speeches, etc. Industry sources: Associations, trade shows, research centers, journals, libraries, books, etc Networking: Customers, vendors, industry experts and others Media: Internet, print and electronic. Regulatory sources: Regulatory bodies, state and central government websites, ministry publications, etc. Hiring expertise: Consultants, industry experts, market research. Registrar of companies: Annual report filed with the registrar of companies under the Companies Act, 1956

INTRODUCTION OF TATA STEELHISTORY OF THE COMPANY:

Durgesh Kumar

VIT BUSINESS SCHOOL, VELLORE, TAMILNADU Page 6

FIBRES 2009: (FA & MD) 200 9Tata Steel was established in 1907 by its founder Jamshedji Nasarwanji Tata; Tata Steel is world 6th largest, Asias first rank steel and Indias largest integrated private sector of steel company. After many years, it emerged as a successful, quick, steel enterprise, due to its ability to make over and ability to meet different challenges of high competitive global economy and obligation to become a supplier of choice by delighting its customers with best services and products. Tata Steels has made four phase Modernization program in the steel works that has enabled it to acquire the most modern and best steel making services in this world. The company has been known as Asias most accepted Knowledge Enterprise at the World Knowledge Forum, Seoul, Korea. It has recently embarked on program for expansion of its existing steelmaking capacity by 2 million tones to reach at rated target capacity of 5 millions tones per annum. The CII-EXIM Award for its corporate excellence and also the Corporate Governance Award, instituted by the Union Finance Ministry for best and excellence in corporate governance, are its testimony to the tata steel for commitment to excel in all activities that it undertakes. Till date, there are eight divisions, including its steel works and its mines and its units have been ISO-14001 certified for the environment. This certification is a reaffirmation of companys belief that will guide betters environmental management leads to superior business performance in future. Tata Steel has been acknowledged by World Steel Dynamics as a world class steel maker. Tata Steel is the only first steel company in the world to receive the certificate by Social Accountability (SA) 8000 by Social Accountability International (SAI), USA. It is a global supportable standard for managing the work place in most effective behavior by improving the work place conditions. The natural strength of the company such as low operating cost, as well as special managerial culture and good profitability has been widely respected and this has led to establishing strategic partnership with different international players in the world market such as Nippon Steel Corporation of Japan; Arcelor of France; POSDATA of South Korea; Ryerson and Paul Wurth of Luxemburg.

Durgesh Kumar


FIBRES 2009: (FA & MD) 200 9MISSION STATEMENT OF THE COMPANYConsistent with the vision and values of Tata Steel to strengthen Indias industrial base through the effective utilization of men and materials. It means that envisaged to attain this are high technology and also productivity, consistent with modern best management practices. Tata Steel believes that while honesty and integrity are essential ingredients for a strong and stable organisation; the profitability provides the main flash of economic activity. Overall the company seeks to scale heights of excellence in all that is does in an enviourment free from fear, and thus it encourages innovativeness and creativity.

BUSINESS UNITS

Strategic Business Units of Tata Steel

Parts from the main Tata steel Division; Tata Steels operations are grouped under the following different Strategic Business Units: Ferro Alloys and Minerals Division (FAMD) Bearings Division Agrico Division Tata Growth Shop (TGS) Tubes Division Wire DivisionJoint Ventures / Associates Corus Tinplate Company of India Limited (TCIL) Tayo Rolls Limited Tata Ryerson Limited (TRYL) Tata refractories Limited (TRL) Tata Sponge iron Limited (TSIL) Durgesh Kumar Tata Metaliks

Tata Pigments Limited


FIBRES 2009: (FA & MD) 200 9Jamshedpur Injection Power Limited (Jamipol) TM International Logistics Limited (TMILL) TRF Limited Jamshedpur Utility and Service Company Limited (JUSCO)

Durgesh Kumar


FAMD DivisionFerro Alloys and Minerals Division of Tata steel were formed out of its Raw Materials Division of Tata Steel, as it Profit Centre in the year 1993 to have greater center of attention on the Ferro Alloys and Minerals business. As part of its beginning and initiatives to raw materials security and growth in different Value Added Products, FAMD division has been also identifying new opportunities for the smooth business and pursuing it to the point of promoting them as a new company or business. Example such as TSKZN in South Africa for the production of its Charge Chrome, it has Chrome mines at Iran, acquisition of Raw met Fe Alloy biz, From April07. This FAMD division is having chrome ore mines, Manganese Mines & Ferro Alloys Plants located at various locations of Orissa at different location. Company has exchange agents to convert raw materials given by them at conversion cost. There are few more plants at different parts of the world (owned by Difffrent Company) who have signed contracts with FAMD to convert their raw material at nominal conversion cost and make Ferro Chrome. Two important raw materials Chrome ore and coke are given by FAMD. Chrome requirement has been assessed and supplied to these plants by their sales unit who are in charge for the co -ordination with these conversion units. Coke requirement for several plants are assessed and imported by this department and is supplied to different plants other resources & various inputs like power, water, etc are arranged by the conversion agents at their own cost. Mines transport the raw materials to FAMD plants and conversion plants at cost price. The price of different raw material is not a concern the recently acquired Raw material plant (Raw-Met), is a 100 % subsidiary of Tata Steel. As regard to this department is concerned it is treated just like a conversion plant. It has similar type of agreement contracted with raw met Company Ltd. As regard to supply of material is concerned, it is coordinated by Tata steels FAMD sales office at Kolkata.

Business profile of FAMD:

It has Leadership position in India in Ferro alloys It is mass Producer and supplier of Charge Chrome, High Carbon Ferro Chrome, High Carbon Silicon Manganese and High Carbon Ferro Manganese. It has various Global reach and strong presence in Japan and Korea, It has now China & Europe and recent venture into US market. It is among the top five Global Ferro chrome players of the world

MILESTONE of FAMD

In year 1999-00 Tata steels FAMD got ISO 14001 Certification In year 1997-98: it introduced customized Chrome conc. For different refractory and chemical sectors. Developed for more customized products for HCFeCr consumers. In year 1995-96 it introduced low impurity Ferro Chrome in the global market. In year 1993-94 FAMD established long term business relationship with premier stainless steel mills worldwide and expanded its business for long run. In year 1993-94 it has received ISO 9002 Certification In year 1991-92 it introduced new products like Chrome, manganese and fluxes

In year 1989-90 FAMD steps into the export market in a major way

FAMDS Customer BaseInternational Customers:Sumitomo Metal Industries, Japan Nippon Steel Corporation, Japan Japan Future Enterprise (Formerly KSC) SINOCHEM, China Hitachi Metals Ltd., Japan Avesta Polarit, UK Shanghai Shenjia Ferro Alloys Works, China Zhejian Hengshan Ferro Alloys Works, China Glencore, Switzarland Ugine S.A. France KTN, Germany Yieh United, Taiwan MTC, South Africa China Steel Corporation, Taiwan Posco, Korea

FIBRES 2009: (FA & MD) 200 9

Domestic Customers:

Jindal Steel & Power Ltd Shah Alloys ISIBAR Sri Vasavi Industries Viraj Alloys Jindal Strips Ltd Nava Bharat Ferro Alloys FACOR Corporate Ispat Alloys Balasore Alloys Ltd Sova Ispat GMR Technologies & Ind. Ltd Srinavasa FA Panchmahal Steel Monnet Ferro Alloys

FIBRES 2009: (FA & MD) 200 9Major FeCr. Producers in the World

Country

Country Capacities (Mill Mt)

Competitive Advantage

Major Players

Capacities ( Mill Mt)

Resources

Mkt. Share (2007)

S. Africa

3.50

Resource Rich, Xstrata Low- Cost, Mkt & Price Leaders SCor Cost Leaders, Alloys Proximity to 2000 China / Europe Resource rich, Zimasco Low Cost Zim Alloys Dom growth, Jilin Proximity to Shanghai other Asian Shenjia Mkts Adequate TataSteel resources, low overheads, IMFA/ICCL Proximity to FACOR Asian markets NBFA ISPAT Jindals

1.8 1.1 0.10

Mines, utility power 52%

Mines, CPP 20%

Kazak

0.95

Zimbabwe

0.32

0.22 0.05 0.20 0.13

Mines, utility power Mines, utility power

6%

China

0.67

0.11 0.14 0.12 0.07 0.09 0.21 Mines Mines + CPP Mines CPP Mines Mines + CPP

India

1.21

8%

Worldwide Major players in FeCr mining:

FIBRES 2009: (FA & MD) 200 9Company Name Capacity ( In LMT) Present Rank Future Rank

2008 Xstrata Samancor 18.00 11.85

2010 21.50 11.35 1 2 1 2

Hernic Kazchrome Outokumpu Tata Steel Group

2.7 1.0 2.6 2.25

4.3 11.3 2.6 3.05

3 4 5 6

4 3 6 5

Global Ferrochrome demand Forecast (000 MT):

FIBRES 2009: (FA & MD) 200 9

Strengths of Tata Steel (FAMD) to be a major player in SE Asia : It has Synchronized Biz philosophy and Cultural alignment both TATA and Japanese value long-term biz relations It is 6th largest capacity in the world capable It is Only Producer and Supplier of both Charge and High Carbon Ferro Chrome by its complementary strength It has Integrated production facilities. Reliable and competitive It has Multi-locational & multi-unit production base which are reliable and flexible It Offer wider range Complementary specs of products both Generic and Niche

It has formed TATA Brand image for superior Product Quality and

FIBRES 2009: (FA & MD) 200 9Service level It has In-house logistic support like bulk and container reliable and competitive

Indias strength comparing to other producing nations:

KSF Power Chrome ore reserves Reductants Proximity to markets Basic infrastructure ( ports/ Rail/road) Government Support Overall Cost of production

SA +++ ++ + ++

Kazakh +++ ++ + +++ -

China + +++ +++ +

India + ++ -

+++ ++

++ +++

+

+ +

Indicators :- [+++]: Strongly positive,[-]:Negative

FIBRES 2009: (FA & MD) 200 9

STANDARD INPUT TEMPLATES OF TATA STEELInformation Parameters Incorporated in Founder Location Key Persons Mining Related Details Capacity (MTPA)

FIBRES 2009: (FA & MD) 200 9Production trends (tpa) Manpower used - Permanent - Contract Type of manpower - Skilled - Unskilled No.of shifts operated Average no. of people per shift Labour Productivity (including contract staff) Labour Productivity (excluding contract staff) Cost of ore produced - Cost/ton of ore production - Cost/ton of over burden removal Technology suppliers Safety requirements Mining equipment capacity utilization Area of mines - Lease (Hectares) - Forest area (Hectares) Total reserves available for mining (in Tonnage) Various Mine operational parameters - Total Depth - Maximum Depth of working - Bench Height - Strike Length - Slope angle - Average Dip - Thickness of ore body - Total tunelling (for underground mine) - No. of levels - Stripping ratio - Explosives used - Powder factor - Explosives cost - No.of Quarry - Ore inventory at mines - Cr/Fe ratio Transportation and despatch related details

FIBRES 2009: (FA & MD) 200 9- Transportation cost - Wagon loading cost - Amount of ore despatched through road and rail - No of sidings being used - Reliability of quality of despatched ore - Inventory at railway siding - Turnaround time for rake - Availability of rakes - Vehicle waiting time - No.of truck movements/day - % of rejection in sorting of ore - Utilisation of fleet Ferro Alloy Plant Related Details Manpower details (overall) - Executive - Non-Executive Manpower details plant wise/furnace wise - Permanent - Contract Manpower productivity (including contract staff) - Output/Manshift (MT) - Production/Manday (MT) Manpower productivity (excluding contract staff) Operations which are outsourced and no. of contract employees used Furnace availability (without breakdown) - Plant availabilty in % terms - Time utilisation in % terms Cost data % fines generation in processing Power Factor Load Factor Method of Casting of Tapping material Customer feedback system Power consumption (Million KwH) - 2003-04 - 2002-03 Power Cost (Rs/unit) - 2003-04 - 2002-03

FIBRES 2009: (FA & MD) 200 9Power Consumption Norms (Kwh/MT) - HC FeMn - MC FeMn - SiMn - FeCr - FeSi Maintenance cost Capacity utilization - 2003-04 - 2002-03 Mn/Fe ratio Cr/Fe ratio Mn/SiO2 ratio Chrome recovery % Mn recovery % Cr % in ore Mn % in ore Fe % in ore SiO2% in ore Mn % in alloy Cr % in alloy % MnO in slag % Cr2O3 in slag % losses in fume Raw material consumption details - Manganese Ore (MT) - 2007-08 - 2006-07 - Chrome Ore (MT) - 2007-08 - 2006-07 - Coke (MT) - 2007-08 - 2006-07 Raw material consumption norms - Specific Mn ore consumption (Kg/MT) - Specific Cr ore consumption (Kg/MT) - Specific Carbon consumption (Kg/MT) Market

FIBRES 2009: (FA & MD) 200 9Exported to

Power Generation Related Details Manpower details Equipment wise Operations which are outsourced and the contract employees used Power cost breakup at various stages (including interest and depreciation) Technology supplier Efficiency of the unit Capacity and various equipment used Cost of various input used Method of waste disposal(qty of waste generation/day) Capital cost of the project Plant availability Other Details Accreditation Accident & Incident Statistics for their Mines, Ferro Alloy Plant and Power Plant - Fatal - Serious - Reportable No. of accidents per million hours worked Frequency (per thousand employed) - Fatal - Serious - Reportable CIFR (no. per million hour worked) Sick leave days (per million hours worked) No. of cases of occupational illness Training cost as % of total remuneration Training days/person No of saplings planted every year at mines and Ferro alloy plant - 2003-04 - 2002-03 Quality of water emitted from ferro alloy plant Quality of air emitted from ferro alloy plant Noise level, Illumination level at mines and alloy plant Instruments/process used for different quality tests

FIBRES 2009: (FA & MD) 200 9Shareholding Patterns Cycle time for carrying out different quality tests CSR

Future Plan

Expantion Plan Capital Outlay Required

FIBRES 2009: (FA & MD) 200 9

Competitor-1

BISRA LIMESTONE AND DOLOMITEThe Bisra limestone and dolomite company was established in the year 1910. Its has the share capital of Rs. 50 crore. It is doing business in mining and marketing of Dolomite and Limestone of various varitites. The organisation has its mining leases in the District of Sundargarh called as Birmitrapur, located in Orissa. Due to alteration in steel making technology the demand for BSLCs products has reduced in recent years considerably resulting in poor financial imbalance arising out of sharp fall in the organisation turn over. After this company came under the strong administrative control of the Ministry of Steel, which comes under Government of India, the Government extended its full support to the Bisra in the form of different Plan Loan, Non Plan Loan as well as Grant in aid for validation of manpower. The companys product mix was also altered and some measures were taken to improve for good quality of products. Following upon taking such decisions the organisation have earned positive gross margin in its business. That is called margin before charging its depreciation and its interest on Government Loan in the year 1996-97. The position however deteriorated once again from 1997-98. At the beginning due to some labour problem and there after due to demand constraints since 1998-99 arised out of recession in Steel Industry. With the Indian Governments support the Bisra has taken vital major steps for rationalization of manpower through execution of Voluntary Retirement Scheme (VRS). The BISRA has been able to separate 3095 number of their employees through VRS from the period span of 1.4.1992 till 31.03.2007. it had previously manpower strength of 5200 approximately as on 1.4.1992 the strength now as on 31.03.07 stood at only 1234. This has enabled company to control the wage related and other types of cost to some significant extent. But now Recessionary trend in the steel sector are over and demand position has little bit improved, the Bisra has been making effort to step up

FIBRES 2009: (FA & MD) 200 9production and dispatch of its products. The company has taken appropriate best steps for development of the new business areas in the leasehold areas Bisra is making of new technology Crushing Plant with additional crushing capacity and also modification and up gradation of the present Crushing Plants and Railway siding. It has signed MOU with Steel authority of India for delivery of its products to SAIL Steel Plants in the Eastern areas. With all these important steps the organisation position has improved and it has been getting positive gross margin in the business before charging the interest on Government provided loan and its depreciation.

Information Parameters Incorporated in Founder

BISRA 1910 bird groups The Bisra Stone Lime Company Limited FD-350, Sector III, Salt Lake City, Kolkata 700 106 Shri K. L. Mehrotra Shri M. S. Barpanda Shri Tapan Biswas

Location

Key Persons PRODUCTION & DESPATCH Limestone (MT) Output Despatch Dolomite(MT) Output Despatch Land (Free hold) (RS) Land (lease hold) (RS) Buildings (RS) Machinery & Plant (RS) Earth Moving Equipment (RS) Electric Machinery & Plant (RS) & General Electrification Siding (RS)

282690 242340 830638 827017 864,068 1,597,111 10,862,507 142,334,156 44,847,219 9,768,039 5,229,900

FIBRES 2009: (FA & MD) 200 9Pipe Line (RS) Furniture (RS) Motor Car, Lorries & Bus (RS) Tractors (RS) Bridge (RS) Water Supply (RS) Mines Office: 785,190 1,021,723 2,106,299 1,036,661 73,690 2,255,157 Birmitrapur, Dist. Sundargarh (Orissa) Tel (0661) 2610270/2610236, Fax (0661) 2610270 The Mining Lease is under consideration of the Secretary of Department of Steel and Mines, which is under Government of Orissa. Finally, it has to be approved by the Steel Minister, Government of Orissa for grant of lease renewal 7.5 km in length 30000MT 1234 limestone and dolomite Rs. 4632 lacs The Company consumes purchased electricity The Company has not absorbed any specific technology for its operational activities 5,000,0000 292110 6,144,790,653 36,269,964 37,602,504

MINING LEASES Mines area Total reserves available for mining (in Tonnage) Manpower Products sales turn-over Conservation of Energy: Technology Absorption

Financial details Share Capital (RS) Reserves & Surplus (RS) Loan Funds (RS) Fixed Assets (RS) Inventories (RS)

FIBRES 2009: (FA & MD) 200 9Sales turn-over (RS) Interest Earned (RS) Other Income (RS) Employees remuneration and benefits (RS) Consumption of Stores & Spare Parts (RS) Power & Fuel (RS) Royalty (RS) Loss for the Year (RS) CURRENT LIABILITIES Sundry Creditors (RS) Advance from Customers (RS) Sundry Deposits (RS) Interest accrued but not due on unsecured loans (RS) SALES Limestone (RS) Dolomite (RS) Reject Boulder (RS) Purchased power (RS) Turnover (RS) Earnings Per Share in Rs. (RS) 4632 lacs NIL 3mm, +3mm to 6 mm and +6 mm to 15 mm and 15mm to 50 mm 4.50% 19.50% 28-30% 19-20% 6-7% 1.40% 0.90% 0.40% 463,159,455 308,552 799,899 107,375,629 5,129,253 34,097,701 67,348,479 -816,132,721 73,175,954 10,501,611 17,090,352 2,758,997 93,966,580 317,457,255 51,735,620 18,382,554

sizes of dolomite Chemical Specification SiO2 Mgo Parameters CaO MgO SiO2 Al2O3 Fe2O3 Total alkali Market

FIBRES 2009: (FA & MD) 200 9domestic organizations nilanchal,adhunik steel etc.

Exported to

Power Generation Related Details Manpower details Equipment wise Operations which are outsourced and the contract employees used Power cost breakup at various stages (including interest and depreciation) Technology supplier Efficiency of the unit Capacity and various equipment used Cost of various input used

NA screening and crushing of ores purchased from outside BHEL/ABB/jaypee NA heavy mining equipments NA filtering,cleaning and then disposing to nearby scrap area through pipelines 0.5 Cr NA Ministry of Steel, Government of India

Method of waste disposal(qty of waste generation/day) Capital cost of the project Plant availability Other Details Accreditation Accident & Incident Statistics for their Mines, Ferro Alloy Plant and Power Plant - Fatal - Serious - Reportable No. of accidents per million hours worked Frequency (per thousand employed) - Fatal - Serious - Reportable CIFR (no. per million hour worked) Sick leave days (per million hours worked) No. of cases of occupational illness Training cost as % of total remuneration Training days/person

2 5

42

FIBRES 2009: (FA & MD) 200 9Quality of water emitted from ferro alloy plant Quality of air emitted from ferro alloy plant Noise level, Illumination level at mines and alloy plant 2% Nitric acid under pollution control undercontrol Dust extraction system of latest technology has been installed in the Crusher plants. At fixed intervals The company keeps close relations with Birmitrapur Municipality for providing good drinking water, it has constructed of dug-well, renovation of ponds in its area, maintenance of the village roads and good education facilities and free hospitals facilities to the family members of the employee as well as local villagers of that area.

Instruments/process used for different quality tests Shareholding Patterns Cycle time for carrying out different quality tests CSR

Future Plan Expansion Plan Capital Outlay Required ANALYSIS OF BISRA LIME AND STONE GENERAL WORKING OF THE COMPANY The Bisra limestone and dolomite company has achieved total sales turnover of Rs. 4632 lakhs during the year under assessment registering an increase by 22.87% from that of the last year (Rs.3770 lakhs). This rise in its sale value has been possible because of over-all improvement in the condition. Both production and dispatch of dolomite and limestone have due to loss till date no expantion plan NA

FIBRES 2009: (FA & MD) 200 9been augmented. There has been also various rise too in selling prices of its products and which has also contributed to the increase in sales value in present year. The Bisra achieved during this year positive gross margin before charging its depreciation and interest on government loan to the amount of Rs.120.31 lacs .However their net loss has greater than before to Rs. 8261.33 lakhs for the year against Rs.6764.74 lacs for the last year due to some compounding effect of interest and penal interest on the government provided loan. The cumulative loss amounted to Rs.62089.42 lakhs from Rs. 53928.09 lakhs for the previous year. FUTURE OUTLOOK With the fast growing trend in the Steel Industry demand of dolomite and limestone has remained stable in recent years. The demand for dolomite and limestone is expected to be encouraging the position in coming years also unless there is any big change in the steel making technology. In the current situation of booming Steel Industry organisation performance is expected to be remaining at moderate and satisfactory level. The company is making all practices to gear it up to meet the challenges of favorable market for running business. With abundant reserves of good cement grade limestone in the leaseholds, the company has kept its hard work on for diversification either by entering into a different contract of sale of cement making limestone and setting up a cement plant on its own. Bisra future steps will depend on the planned re-structuring and re-organization method of the organisation as well as the whole groups.

MINING LEASESThe Bisra limestone and dolomite Mining Lease is under consideration of the Secretary of Department of Steel and Mines, which is under Government of Orissa. Now it will be permitted by the Steel Minister of Government of Orissa for grant of lease renewal.

VOLUNTARY RETIREMENT SCHEME Through execution of Voluntary Retirement Scheme (VRS) for a past many years 3194 numbers of employees could be removed till 30-06-2007 with an outgo of Rs. 31.93 crores. It has Rs. 20.42 crores towards funding in aid and Rs.1.52 crore towards non-plan loan received from the government of India.

FIBRES 2009: (FA & MD) 200 9The Bisra has next programme for rationalization of their skilled and unskilled manpower with a view to decreasing the manpower cost. CONSERVATION OF ENERGY, TECHNOLOGY FOREIGN EXCHANGE EARNINGS AND OUTGO. ABSORPTION AND

a) Conservation of Energy: The Bisra Company consumes purchased electricity for production. Vital steps are taken by the Bisra Company to decrease the power consumption. b) Technology Absorption: The Bisra Company has not absorbed any new specific technology for its operational activities for making its products. c) Foreign Exchange Earnings and Outgo: There were no transactions in foreign exchange during this year.

8. PARTICULARS OF EMPLOYEES With Provision of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended is not concerned in respect of remuneration of any employee of the organisation. WELFARE ACTIVITIES Notwithstanding the financial constraints the Bisra Company attributes more importance to the different welfare activities for its employees and their families for employee satisfaction and also for local villagers who live nearby the mines areas in reflection of the socio-economic needs of the region. i) Bisra organisation keeps close relations with Birmitrapur Municipality for providing good quality drinking water; it has constructed many dug-well, renovation of different ponds, and maintenance of the roads of nearby area and free education facilities and free hospital facilities for the family members of the employee as well as local villagers of that particular area. ii) Bisra company participates in various Health related Care Camps throughout the year which is organized in that area such as eye testing camp, family related planning camp, children pulse polio drive etc.

FIBRES 2009: (FA & MD) 200 9iii) Bisra company extends its full hearted support to the Birmitrapur Municipality for development of new roads, construction of ponds and cleanliness in the local area.

STEPS TAKEN FOR POLLUTION CONTROL To keep the environment clean and safe nearby the mining zones for pollution free atmosphere the following different steps have been taken by the company:i)

It has installed Dust extraction system in the Crusher plants. deploying one hired truck mounted with water sprinkler.

ii) Dust suppression at heave road and crusher point is made by

iii) Time to time Environmental monitoring have been done to study the

pollution towards different areas such as water, air and noise to take appropriate protection and steps through approved agency and their reports are sent to MOEF and State Pollution Control Board of India iv) During the year 2007-08, 6500 numbers of saplings have been planted at the road-side of Office to Lime furnace Siding to capture the flow of harmful dust towards National Highway.

competitor-2

FIBRES 2009: (FA & MD) 200 9XSTRATA ALLOYS

Information Parameters Incorporated in Founder

XSTRATA 1926 Willy Strothotte, Chairman

Location

Key Persons

Bahnhofstrasse 2, P.O. Box 102. Xstrata Alloys headquarters are located at Portion 27, Waterval 306 JQ, Rustenburg, South Africa. CEO: Micheal L. Davis CFO: Trevor L. Reid

Products Website No. of Employees Capacity (MTPA) Production trends (tpa)

Manpower used

Xstrata Alloys company is a producer of Ferro chrome as well as primary vanadium. Xstrata Coal is an exporter of thermal coal and a producer of hard coking coal and semi-soft coal. Xstrata Copper is a copper producer, with mining and processing facilities located in Australia, Chile, Peru, Argentina and Canada. Xstrata Nickel is a nickel and cobalt producer. Xstrata Zinc is a miner and producer of zinc. http://www.xstrata.com 40,049 The run-of-mine capacity is 60,000 tpm. Xstrata-Merafe P&S venture has a combined production capacity in excess of 2 million tone of Ferro chrome per annum. 43000

FIBRES 2009: (FA & MD) 200 9- Cr/Fe ratio Ferro chrome is a corrosion-resistant alloy of chrome and iron containing between 35-37% iron and 49-52% chrome Because of distance between the mines and smelters, Xstrata Alloys uses haul trucks to transport products. 28,542 27,952 10,888 9,657 8,792 7,261 5,424 4,698 5.60 4.90 11,046 8,888 26.29 25.51 50 18 12.3 10.1 South Africa Boshoek plant, Boshoek Lion plant, Steelpoort Lydenburg plant, Lydenburg Rustenburg plant, Rustenburg Wonderkop plant, Marikana Boshoek opencast mine, Boshoek Horizon mine, Pilansberg Kroondal mine, Rustenburg Thorncliffe mine, Steelpoort Helena mine, Steelpoort

Transportation and despatch related details Financial details Revenue 2007 Revenue 2008 EBITDA 2007 EBITDA 2008 EBIT 2007 EBIT 2008 Attributable profit 2007 Attributable profit 2008 Earnings per share 2007 Earnings per share 2008 Cash generated from operations 2007 Cash generated from operations 2008 Net assets per share 2007 Net assets per share 2008 Dividends per share 2007 Dividends per share 2008 Total recordable injury frequency rate 2007 Total recordable injury frequency rate 2008 Key locations

FIBRES 2009: (FA & MD) 200 9Waterval mine, Rustenburg Rhovan V2O5 and FeV, Brits Maloma mine, Maloma, Swaziland Char Technologies, Witbank African Carbon Manufacturers, Witbank African Carbon Producers, Witbank African Fine Carbon, Middelburg African Carbon Union, Witbank Mototolo, Steelpoort Eland, Brits $2,0 02m $1,0 07m 9,476 7.40 12.40 9.40

Contribution to Group Revenue Contribution to Group EBIT Average number of employees in 2008 Employees Turnover 2007 Employees Turnover 2008 %ofwomen in theworkforce 2007

%ofwomen in theworkforce 2008 % of female managers 2007 % of female managers 2008

11 13 15

Average training hours per employee 2007 Average training spend per employee 2008 New occupational illnesses New occupational illnesses by type Dermal conditions % Respiratory conditions % Musculoskeletal % Noise-induced hearing loss % Total recordable injury frequency rate Lost-time injury frequency rate

32 38 60

8 10.00 27 55 10.1 2.70

FIBRES 2009: (FA & MD) 200 9Corporate Social Involvement ($m) environmental incidents incidents by type Storm water discharges off-site Breach of air emissions limits Ground contamination Water contamination Greenhouse gas emissions (CO2e mt) CO2-e by CBU* (% of Group total) Nickel Copper Zinc Coal Alloys Energy usage (PJ) 127.10 DETAILS (%) Natural Gas 6 Naphtha 7 Other fuels 14 Diesel 21 Coal/coke 3 Electricity 49 Fresh water use (ML) Recycled water use (ML) Production Ferrochrome (kt) Ferrovanadium (k kg) V2O5 (k lbs) Platinum Group Metals Average prices Chrome (US/lb) (European 170000 520400 1,126 3,622 16,604 222,516 175.8 84.1 8 1 1 3 3 26.9 9.00% 12% 16% 33% 30%

FIBRES 2009: (FA & MD) 200 9benchmark) Ferrovanadium (US$/kg) (Metal Bulletin) Vanadium pentoxide (US$/lb) (Metal Bulletin) Platinum ($/oz) Palladium ($/oz) Rhodium ($/oz) (Metals Week) Alloys Financial data Revenue ($m) EBITDA ($m) EBIT ($m) Share of Group EBIT (%) Capital expenditure ($m) Xstrata Alloys operation (KT) Boshoek plant Lion plant Lydenburg plant Rustenburg plant Wonderkop plant Boshoek opencast mine Horizon mine Kroondal mine Thorncliffe mine Helena mine Waterval mine Rhovan V2O5 Maloma mine Char Technologies African Carbon Manufacturers African Carbon Producers African Fine Carbon African Carbon Union Mototolo Eland Market Exported to

61.2 13.5 1,578 353 6,483 2002 1094 1007 13.9 222 190 242 283 302 400 1331 38 1134 1150 434 66 16604 280 92 125 124 101 102 158 145

FIBRES 2009: (FA & MD) 200 9The Company focuses on seven international commodity markets: copper, coking coal, thermal coal, ferrochrome, nickel, vanadium and zinc, with additional exposures to gold, cobalt, lead and silver. Xstrata plcs operations and projects span 19 countries. Its activities are organized into five global commodity businesses: alloys, coal, copper, nickel and zinc, and a technology business. 13.82% 20.85% 29.38% 7.19% 15.43% 1.31 5.96

Key Status & Ratio Net Profit Margin Operating Margin EBITD Margin Return on Average Asset Return on Average Equity EPS P/E

ANALYSISXstrata Company is a global world diversified mining group, it has been listed on the London as well as Swiss Stock Exchanges, Xstrata has headquarters in Zug, located in Switzerland. Xstratas businesses has made a top position in seven major international commodity markets throughout the globe like copper, Ferro chrome, coking coal, thermal coal, nickel, vanadium and zinc, with their latest recycling facilities, additional exposures to gold, cobalt, lead as well as silver and a suite of top class global technology products, many of which have made them industry leaders. The Xstrata Group's business operations and their projects are spanning in different 18 countries of the world : they are Canada, Argentina, Australia, Papua New Guinea Brazil, Chile, Colombia, Philippines ,the Dominican Republic, Spain, Germany, New Caledonia, Norway, Peru, the, South Africa, Tanzania, the USA and also UK. Xstrata employs near about 43,000 people both skilled and unskilled, including contractors.

FIBRES 2009: (FA & MD) 200 9The Xstrata company exports coal from and makes Ferro chrome & vanadium at South Africa and Australia mines and smelts zinc in Spain through subsidiary Austrians de Zinc and in Germany, and it has mines anthracite also in Swaziland. Xstrata plc was established in year 2002, when Xstrata bought Glencore International's coal assets for entering into business. In this year the company acquired MIM Holdings a deal that increased approximately doubled Xstrata's coal and zinc holdings in market. Coal accounts for not fairly half of its sales, and Xstrata is among the worlds largest and top coal exporters. Credit Suisse Group and Glencore has share of 24% and 16%, respectively, of Xstrata coal business.

3 major and top level companies which are named as Cerrejon Coal, Tintaya Copper and Falconbridge Ltd. acquired in year 2006, which created an exceptional wide range of organic growth option in business. Cash acquisition of total $19.6 billion was completed and also maintaining grade credit rating of products. It has a ratio of 42% at year ending and Performa operating cash flow of approximately $9.5 billion.

Total Annual synergies of Xstrata are $546 million confirmed with Falconbridge acquisition by the company. Cost of mining inputs like labour, mining consumables and equipments continued to increase in the year 2008. $57 million of real cost saving was achieved during the last financial year.

Due to Confirmed increased resources at different parts like Wandon for thermal coal , Antapaccay, Mount Isa , Alumbrera , , Las Bambas &Tampakan for copper , Raglan , Kabanga , Araguaia for nickel productions New Projects are also commissioned such as on time & on budget at Rolleston Thermal Coal , Wollombi coking coal ,Lion Ferrochrome , Mototolo PGM and Lennard Shelf zinc-lead.

Sales by Percenta

FIBRES 2009: (FA & MD) 200 9

The origins of Chrome Resources lie in the acquisition Chroombronne mine in the Western Belt in year 1987.

of

the

Mine DetailsKroondal Mines The run-of-mine capacity of Xstrata at Kroondal has increased to 110,000 tpm from 80,000 tpm a from few years ago. Their Operations at the mine have been 100% mechanized with the help of latest technologies thereby it has reduced the labour content of their total costs. Since year 2001 the mines has been accessing reserves which is held by global Ferro chrome player Samancor, this ore being fed to the two new latest made furnaces at Wonderkop (#5 and #6) which run as run as a joint venture. Kroondal has a further estimation of 20 years life and this could be extended to 40 years if new reserves will be developed. Now it is extended upto year 2016. Kroondal and Marikana have combined chrome reserves of 20-million tones and the Wonderkop have joint venture consists of two semi closed furnaces and a recovery plant, with a production capacity of 191 000 tons per annum. Waterval mines The Waterval section of mines was developed from the dormant Cashan mine, acquired in the year 1992.its Production was again restarted in year 1994, and a surface treatment plant was made in March of year 1995.The Waterval capacity was quoted as 61,000 tpm run-of-mine (500,000 tons per annum) in year1997, but it was subsequently downgraded to 30-40,000 tpm

FIBRES 2009: (FA & MD) 200 9in year 1998 and year 1999.From year 2000 its operations were merged into those of the Purity mine to create an operation which is called as Waterval East having a theoretical capacity of 61,000 tpm run-of-mine basis, though the production at the start of year 2002 was just near about one-third of this level. A latest mining operation known as Waterval West began production in year 2001 and is likely to reach full capacity of 100,000 tpm from by the end of year 2003.

Wonderkop mines Wonderkop mines were started in year 1996 in tandem with the newly commissioned fifth and sixth Fe Cr furnaces. The run of mine capacity is around 60,000 tpm. Ore from the plant is carried and transported to the short distance to the smelter by means of a conveyor belts. Productions and Operations at Wonderkop have been scaled back since year 1998, in preference to using ore from other mines it has been sourced from platinum mining. In year 2001 there was no production at Wonderkop mines, and the mine remained closed at the starting of year 2002.

Thorncliffe mines Thorncliffe mines were developed at the period of 1996-98 first and foremost to meet the ore requirements of the Lydenburg plant which is 60 km away. The mine production was displaced a longstanding contract that CMI Lydenburg held with Samancors Winterveld mine for the supply of ore fines in the international market. Open cast operations started at Thorncliffe mines in year 1996 at a fast rate 40,000 tpm run-of-mine to a depth of 30 meters. Underground mining started in month of May 1997, and in year 1998 the ratio of open pit to underground ore extracted was 1:2 Open-cast mining at Thorncliffe stopped completely from month of April 1999.Three incline shafts provide access to the ore body up to 300 meters below the surface. These Reserves are sufficient for at least next 40 years at the recent level of mining. The total capacity at Thorncliffe is near about 120,000 tpm run-ofmine. Yields at Thorncliffe are up to 86% as opposed to 70% at the

FIBRES 2009: (FA & MD) 200 9Rustenburg mines because of the thicker seams of 1.8-2 meters, it has higher ratio of the lumpy ore and low angle of the seam of 11.

Townlands mines In month of July 1997 the Xstrata company purchased the Townlands chrome ore deposit near Rustenburg, but its development was subsequently delayed by third party claims.This deposit has been estimated to contain up to near about 100m tones of ore, and it is likely to be developed in conjunction with good infrastructure at the Purity mine. The production capacity has been estimated approximately to 100,000 tpm run of mine. Three incline shafts were providing access to the ore body up to 300 meters below the surface. It has Reserves which are sufficient for at least next 45 years at the current level of mining. The total capacity at Thorncliffe mines is near about 120,000 tpm run of mines. It has Thorncliffe mines are up to 85% as opposed to 70% at the Rustenburg mines due to the thicker seams of 1.8-2 meters, higher ratio of the lumpy ore and low angle of the seam 11

SYNOPSISXstrata was started development in year 2007 with outstanding organic growth prospects, a strong and fair balance sheet and a diversified portfolio of cash generation and and efficient operations for production. Xstrata has a very highly motivated and well efficient entrepreneurial team for managing business efficiently throughout globe .year 2007 was a seminal year for Xstrata. With its strong commodity prices and increase in base metal prices Xstrata had a very good sustainability. 1 Company transforming 2 incremental acquisitions were integrated at the end of year 2007.The group spend about $20.2 billion for this work. Xstratas transformation and growth has taken place during an exceptional time when in commodity market their commodity prices near their all time low.

Xstrata Alloys continues to make market leadership in the Ferro chrome market as an international player. In February of year 2007 the group

FIBRES 2009: (FA & MD) 200 9concluded ZAR 575 million contracts with the Bakwena Ba Mogopa community. This added value to Xstrata Alloys for doing smooth business. The Lion project and Falconbridge acquisition has boosted the market position greatly up to higher levels.

Xstratas commodity business continued to grow towards their goals of zero harm in the world market. Xstratas Kroondal Mines, Waterval Mines East & West together Thorncliffe Mine and Wonderkop Mine together have total reserves up to of 300 MT. So this huge potential lies within to expand further by Xstrata. With their ongoing operations and mine capacities has increased due to recent acquisitions. Xstrata continues an excellent market positioned is expected to grow further in coming years.

competitor-3

FIBRES 2009: (FA & MD) 200 9OUTOKUMPUInformation Parameters Incorporated in Founder Corporate Management Riihitontuntie 7 B P.O. Box 140 02201 ESPOO FINLAND VICTOIRE DE MARGERIE,ANNA NILSSON-EHLE,LEO OKSANEN,LEENA SAARINEN 1 423 thousand tons Cold and hot rolled stainless steel coil, sheet and plate, quarto plate, thin strip, tubular and long products. Full range of standard and high alloyed austenitic grades, as well as ferritic duplex, and manganese grades Cold rolled flat products in thickness range from 0.12 mm to 6.5 mm. White hot strip and hot rolled plate in varying widths and thicknesses. Full range of tubular products from hygienic tubes to heavy walled pipes. Distributors, re-rollers and further processors, tube makers as well as enduser and project customers in different industrial segments. OUTOKUMPU

Location

Key Persons Sales (2008) Stainless steel deliveries (2008) Main products

Grades Dimensions

Customers

FIBRES 2009: (FA & MD) 200 9Typical customer industries using stainless steel Architecture, Building and Construction, Chemical, Petrochemical and Energy, Architecture, Building and Construction, Chemical, Petrochemical and Energy, Transportation, Catering and Appliances, Process Industries and Resources and various other industries and applications.

Main production facilities

Sales companies and service centers Financial data Sales million Operating profit Non-recurring items in operating profit million Profit before taxes million Non-recurring items in financial income million Net profit for the period from continuing operations million Net profit for the period from discontinued operations million Net profit for the period million Capital employed on Dec. 31 million Return on capital employed % Net cash generated from operating activities million Capital expenditure million Net interest-bearing debt on Dec. 31 million

Finland, Sweden, the UK, the US, the Netherlands A comprehensive network of sales companies and service centers in some 30 countries 5 474 -63 -83 -134 -21 -110 -79 -189.00 3,867.00 -2 656 544 190 1072

FIBRES 2009: (FA & MD) 200 9Equity-to-assets ratio Debt-to-equity ratio % Earnings per share Earnings per share from continuing operations Earnings per share from discontinued operations Equity per share Dividend per share Share price on Dec. 31 Market capitalization on Dec. 31 million Stainless steel deliveries 1 000 tons Stainless steel base price 2) /ton Personnel on Dec. 31, continuing operations Electrical energy OUTOKUMPU STAINLESS STEEL DELIVERIES Cold rolled White hot strip Quatro plate Tubular products Long products Semi-finished products Total deliveries Sales/person, million Incentives of total remuneration costs, % Training costs of total remuneration costs, % Training days/person EMISSIONS INTO THE AIR 52.4 38.4 -1.05 -0.61 -0.44 15.5 1 8 1,502.00 1,423.00 1,185.00 8,471 43%of total production costs 15 32 739 330 120 70 55.00 109 1,423 0.6 4.90 1.4 3 Although dust emissions have traditionally been the most significant class of emission from the steel industry,emissions of dust by Outokumpu have decreased in the past years despite an increase in production

FIBRES 2009: (FA & MD) 200 9levels.The majority of particulate emissions by Outokumpu originate from the steel mills in Tornio and Avesta and the hot-rolling mill in New Castle in the us. In 2008, Outokumpus carbon dioxide emissions totaled 871 000 tons(2007: 932 000 tons). The major waste streams from Outokumpus stainless steel operations are slags, sludges, dusts and scales. Wherever practicable, wastes are collected and recycled to recover valuable alloying elements such as nickel, chromium and molybdenum.

WASTE

INJURIES (EMPLOYEES AND CONTRACTORS)

9 At the beginning of 2008, Outokumpu announced that it would invest eur 5 million in an environmental target to be decided through a Group-wide competition to combat climate change. Proposals were supposed to present innovative solutions for either lowering Outokumpus carbon dioxide emissions or reducing the amount of waste generated.

ENVIRONMENTAL INVESTMENTS SHARE-RELATED KEY FIGURES Earnings per share Equity per share Dividend per share Dividend payout ratio %

-1.05 15.5 0.5 Neg

FIBRES 2009: (FA & MD) 200 9Dividend yield % Price/earnings ratio neg. Development of share price Average trading price Lowest trading price Highest trading price Trading price at the end of the period Change during the period % Change in the OMXH index during the period % environmental responsibility 6 Neg 6.33 33.99 8.28 -61 -53.4 1492 from the process industry and industrial machinery to building, construction and electrical industry, transportation, electronics and information technology, as well as catering and households

Customers expansion plan

ANALYSISOUTOKUMPU is an also international global leader in the market of stainless steel. Its long term vision is to be the undisputed number one in stainless steel producers, with success based on operational excellence at different levels. It has Customers in a wide range of industries with worldwide use of their stainless steel products and services. It is Being fully Recyclable and maintenance of free, as well as very well-built and durable material, stainless steel are one of the key building blocks for ustainable expectations. Outokumpus does business in mostly 30 countries and employs near about 8 000 people. The Outokumpus head office is located at different places like Espoo and Finland. Outokumpus has also been listed on the NASDAQ and OMX Helsinki since year 1988.

Outokumpus market positionThe global stainless steel market totals 27 million tons or some euro 80 billion. During its past twenty years, Outokumpus consumption has grown at near about rate of 56% per year. In Europe, the Outokumpus Groups main

FIBRES 2009: (FA & MD) 200 9business market places, the market size are total of 4.23 million tons and its consumption has grown up by 2.5% yearly. In recent years, the prime growth globally has occurred in country China with a growth rate of about 15% yearly. Outokumpus is one of the worlds best quality steel makers of world. Top manufacturer of stainless steel with main manufacturing as well as production facilities are located in different parts of the world like Sweden, Finland, UK, US and Netherlands. Outokumpus melting capacity is near about of total 2.56 million tons per annum and its finished products capability for cold rolled material as well as white hot strip rolled material is 1.6 million tons per year. Outokumpus have also yearly production capacity of 0.3 million tons of long products and plate of different sizes and varieties. In global method, Outokumpus biggest workplace is Tornio Works which is located at Finland; it is one of the top worlds most economic cost levels and the best integrated single-site of Stainless steel production facilities. At work place of Tornio Works at Finland, Outokumpu mainly produces high volume standard quality and grades of stainless steel as well as Avesta integration which is located in country Sweden is focusing greater on customer required special grades and products. Outokumpus has an 18% of total share of the stainless steel coil market in continent of Europe and just a 6% share on the other parts of world. Outokumpus main markets are basically located European markets it has achieved 78% of sales in year 2008, in Asia it has achieved 8% as well as in North and South America is 11% of sales.RAW MATERIALS

Carbon steel and Recycled stainless as well as ferro chrome and nickel are the important necessary raw materials which are used in production of stainless steel. Ferro chrome, and mainly nickel, are the most vital raw materials for manufacturing steel. Outokumpu has its own chromite mine at place called Kemi and a ferro chrome smelter at Tornio, both are located in Finland. Carbon steel and Recycled stainless as well as nickel and some of the ferro chrome are brought from open market. ENERGY Electrical energy consumption accounts for approximately 4% of its total production and manufacturing costs. The more electric energy are mainly consumed by its Tornio ferro chrome smelter and the stainless steel melt

FIBRES 2009: (FA & MD) 200 9shops in Tornio which is located in Finland, Avesta at Sweden & Sheffield at Britain. SHORT-TERM ACTIONS

Outokumpu is facing this situation from a strong financial condition. It has a healthy Balance sheet, its debt maturity profile are properly balanced and their cash flow is sounds good for current business scenario. As a top organization, however, they have to be ready for a situation in which business in the markets will remain poor for some time ahead. So we can say that outokumpu has made some decisions on key actions in the month of December and January that plan at maximizing in their short-term cash flow and ensuring financial flexibility.

The important key actions of outokumpu are: It has focused in Cost reductions in both variable and fixed costs they have reduced. The main target for fixed cost savings is in the range of approximately euro 100 million for 2009. Well-organized management of inventories and procurement to make sure to do working capital reduction for the company. It has done Postponement of investments in huge amount in year 2009. This investment program was limited up to approximately euro 300 million in the year of 2009, and it has shown reduction of more than euro 500 million compared to the previous original plan.

STRATEGYOutokumpus strategy mainly aims at making a more balanced and predictable business form. Some of the important key components in its strategy are increasing it sales to end-users of products and also to project customers, by making greater stable deliveries to distributors, and increasing Sales of the special products and ferritic (non-nickel containing)

FIBRES 2009: (FA & MD) 200 9grades. To maintain the realization of these types of vital strategic goals, a new well maintained commercial organization structure was made recently. The key concept in this new structure is the making of a customer segment groups whose main work is to understand the needs and wants of different types of target customers.

The segment teams unite the expertise of the customer and product awareness, R&D hold and supply chain ability. The acquisition of the Italian distributor So GePar during the summer of year 2008 was a very important and vital step forward in end-user customers of the market. The acquisition brought United States big customer base and good quality service center operations in Italy & UK, both of which are strategically important markets for Outokumpu for doing the business. Their strategy is to develop a more balanced and stable business model which is remains valid even though some of the related, earlier Decided investments which are now postponed for some times. Now at present, outokumpu have sufficient available capacity to sell more special products and ferritic quality grades, and to increase both project business and end-user their new organization is well suited for handling this type of challenge.

OUTOKUMPUS KEY STRENGHTIt has Fully-integrated and globally cost-competitive production plant located in Tornio It has the leading position in specialty products of different qualities. They have Strong customer orientation for doing the business effectively. They make Highly-recognized product of different varieties and of process development It manly Focus on continuous improvement and excellence for its business.

FOUR MAIN TYPES OF STAINLESS STEELThey have Different types and compositions of stainless steel which are developed for different end-user working. The four main grades are mainly austenitic, ferritic, ferritic-austenitic, and martensitic steel. All grades of

FIBRES 2009: (FA & MD) 200 9stainless steel mainly contain of an approximately of 10.5% of chromium. Outokumpus main product is austenitic stainless steel, which mainly has near about 8% nickel in totaling to 18% chromium. Ferritic stainless steel does not have nickel in the production of steel, but chromium is mixed up to 24%. Martensitic stainless steel contains mainly around 1113% chromium in its product. Ferritic-austenitic types of steel mainly contain 1.55% amount of nickel, and they are very strong and hard and corrosion Resistant. In the product of steel. Outokumpus duplex steel grades are mainly of ferriticaustenitic, which is containing only small proportion of nickel in its product.. SERVICE CENTERS AND RETAIL SALES CUSTOMERS As of January 1, 2009, Outokumpus have made service centers and retail sales have been organized as a third sector in Group Sales and Marketing for doing the business properly in the market. Stock & Processing Operations Retail Sales There is a key channel is made for serving in better way both for end-user and project customers is the Groups arrangement of stainless steel as well as service centers. Outokumpu is recently expanding its capacity at the Groups service center at Willich, which is located in Germany, with the expanded capacity coming on full growth in year of 2009. A Greenfield service center being built in Shanghai, China, its main objective is to process mainly special grades operational in year 2010. Other service center projects are also planned for different locations of the world such as Poland, Southern Germany, France and India have been temporarily postponed due to of the global financial crisis and the weaker stainless steel market. In year 2008, Outokumpu completed the acquisition of So GePar, it is distributor based of Italy, Which increased the Groups service center capacity by near about of 1.6 million tons yearly. The So GePar units were included into the Groups commercial organization on January 1, of year 2009. Outokumpus Retail Sales serves a huge number of smaller local customers of service centers which are not allocated to End-user and Project clusters.

TRAINING AND DEVELOPMENT

FIBRES 2009: (FA & MD) 200 9Continuous Outokumpus training and development programme is one of the important priority areas of Outokumpus human resources plan. The Group offers much number of different types of development programs and creates opportunities which will mainly focus on developing employees skills and competence in the work. Outokumpu wants to maintain its position as the cost leader in the stainless steel market; Outokumpu has been running so called Operational Excellence programs since 2005. These types of programs mainly consist of new methodology of theoretical training, real project work & leadership training. A new type of Stainless Pro, an international program for graduates with a university level degree, was started in year 2007. Few new trainees started the program in September of year 2008. During the period of this two-year program, trainees are given the chance to work in different parts Outokumpu business units. The total Training costs in year 2008 was 1.4% of total salaries. The Group almost provided 2.8 training days per employee in the year 2007.

THE NUMBER OF EMPLOYEES In December of year 2008, the company employed near about 8471 people in different parts of the world covering almost 30 countries round the globe. The average period of service was 15 years. Its Personnel turnover in the year 2008 amounted to 7% and the average age of the companys permanent employees was near about 43.3.

RISK MANAGEMENTOUTOKUMPU generally works in accordance with the help of risk management policy which are approved by the Board of Directors. The risk management policy mainly defines the objectives of organization, its approaches and also its areas of responsibility of risk management. Risk management supports the company strategy and it also helps to maintain a balanced risk profile from the point of view of shareholders as well as other stakeholders such as customers, suppliers, personnel and lenders which are related with the company in its business.

FIBRES 2009: (FA & MD) 200 9Company has defined risk to be anything that may have an adverse effect on activities that the organization has undertaken to achieve its goals. Risks can thus be called as threats or uncertainties or lost opportunities relating to present or future operations in the business.

SHARES AND SHARE CAPITALOn December 31, year 2008, Outokumpu has fully paid and registered its total share capital amounted near about euro 308468201.10 and it consisted of near about 181451 883 shares in the market. Each share of the company entitles its share holder to one vote at General Meetings of Shareholders.

CONCLUSIONThe three competitors of Tata steel of Ferro alloys Xstrata and Outokumpu are international level competitors while bisra lime and stone is domestic competitors. Xstrata have more number of mines at South Africa where they can produce Ferro alloys at cheaper cost. They have the corporate office at different parts of world. Xstrata is currently the world's largest and amongst the lowest cost integrated ferrochrome producers in the world. The Group's operations and projects span 18 countries. They have well trained manpower and management which is doing the business effectively across the globe. Xstrata have made good infrastructure which are helpful in doing business effectively. Operations at the different mine have been 100% mechanized there for it has reduced the labour content of its total costs. A huge prospective lies within to expand further for doing its business across the world, with their recently ongoing operations and mine capacities and by the recent acquisitions. Xstrata continues an excellent market positioned is expected to grow further. Outokumpu is also a global Ferro chrome producer. It has maintained a global leadership in cost efficiency in high volume of its standard grades due to its integrated economic and with the help of recent technology production from chrome to stainless steel melting, cold rolling as well as hot rolling. A majority part of Outokumpus sales is reaching to the end-user of stainless

FIBRES 2009: (FA & MD) 200 9steel through its strong marketing channels and distributors and further processors. The company recent product portfolio mainly consists to a large extent of nickel containing stainless steel of different grades. As nickel price is very volatile, demand for these grades and products also tends to vary a lot.

The majority of Outokumpus sales and almost all production sites are located in different parts of Europe. In order to create a more balanced and stable business environment in the market outokumpu intend to increase the market share of sales to different types of end-user customers & projects and to key distributors with more predictable order volumes. Their mainly strong and well trained sales organization has been aligned and their service center network has been strengthened with the aim to better serve the different industries using stainless steel. BISRA lime and stone is a very small domestic level organization which produces limestone and dolomite. It has a small capital comparing to other Ferro alloys market player. Due to change in steel making technology the demand for BSLCs products declined sharply at greater level resulting which financial imbalance arised out of sharp fall in the BISRA turn over. It has signed into MOU with SAIL for dispatch of its products to SAIL Steel Plants which are located in Eastern Sector of India. With all these steps the BISRA position has little bit improved and it has been achieving positive gross margin of profit before charging the interest on its Government loan and its depreciation.

REFRENCES

FIBRES 2009: (FA & MD) 200 9www.tatasteel.com www.mjunction.com www.coolavenue.com www.xstrata.com www.Outokumpu.com www.birdgroups.com Steel journals and magazines Tata steels databases

Documents

Fibres 2009: (Fa & Md) 200 9