Rayen Steels Project_2

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    INDUSTRY PROFILE

    INTRODUCTION

    Industry is a massive employment agent providing opportunities, board basing

    entrepreneurship and securing distribution of economic wealth.

    Industry occupies a place of importance in the economy as potential caretakers of economic

    resources in particular, the labor resources as they provide employment for substantial work

    force.

    They have strategic role to play in the economic development of counties and remain

    important in the economics of the more highly industrialized countries.

    Sponge Iron is a recognized alternative to steel scrap as a raw material for the manufacture of

    various steel products.

    The twin issues of rapid depletion of Coking Coal reserves and the scarcity of indigenous

    scrap, made the Government of India support production of sponge iron in the country.

    To boost the growth of the industry a major thrust was given by the Government of India by

    providing the manufacturers the following benefits:

    De-licensing,

    Firm linkages,

    Allocation of natural gas

    Financial support.

    This lead to an immense growth of the sponge iron industry in India, from a meagre capacity

    of 30,000 tons per annum in the year 1980-81 it grew to millions of tones.

    Today, India ranks No.1 globally in the production of Sponge Iron.

    The complete inbuilt facility for production of sponge iron, which is further, utilized in the

    manufacture of various iron/steel products such as TMT Bars, D.I. Pipes, etc.

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    However since the last survey, the domestic sponge iron industry has undergone

    dramatic changes such as

    India has emerged as the worlds largest producer of sponge iron.

    The coal based sponge iron segment has witnessed rapid growth in numbers.

    This has led to increase in both capacity and production (coal based).

    Significant expansion programs launched by existing units (both coal and gas).

    Upstream integration of existing steel producing units.

    Emergence of sponge iron units with planned foray into steel making.

    ABOUT THE STEEL INDUSTRY

    The story of the industry and its growth begins with the iron and steel. Steel industry is

    booming in the whole world. The increasing demand for it was mainly generated by the

    development of projects that has been going on along the world, especially the infrastructural

    works and real estate projects that has been on the boom around the developing companies.

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    Steel is an alloy of iron usually containing less than 1% carbon. It is used most frequently in

    the automotive and construction industries. Steel can be cast into bars, strips, sheets, nails,

    spikes, wire, rods or pipes as needed by the intended user.

    The process of steel making has undergone many changes in the 20th century based on the

    political, social & technological atmosphere. In the 1950s and 1960s demand for high

    quality steel encouraged the steel making industry to produce large quantities.

    The energy crisis of the 1970s made thermal efficiency in steel mills a priority. The furnaces

    used in integrated plants were very efficient, however, the common production practices

    needed to be improved. The large integrated plants of the 1950s and 1960s tended to

    produce steel in batches where iron ore was taken from start finish. This causes someequipment was in use. To help reduce energy use, continuous casting methods were

    developed by keeping blast furnaces continuously feed with iron ore, heat is used more

    efficiently.

    HISTORY OF STEELMAKING

    Ancient steel: Steel was known in antiquity, and may have been produced by managing

    bloomeriesiron-smelting facilitiesso that the bloom contained carbon.

    The earliest known production of steel is a piece of ironware excavated from an

    archaeological site in Anatolia (Kaman-Kalehoyuk) and is about 4,000 years old. Other

    ancient steel comes from East Africa, dating back to 1400 BC.

    In the 4th century BC steel weapons like the Falcata were produced in the Iberian Peninsula,

    while Noric steel was used by the Roman military. The Chinese of the Warring States (403

    221 BC) had quench-hardened steel, while Chinese of the Han Dynasty (202 BC 220 AD)

    created steel by melting together wrought iron with cast iron, gaining an ultimate product of

    carbon-intermediate steel by the 1st century AD.

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    WOOTZ STEEL AND DAMASCUS STEEL

    Evidence of the earliest production of high carbon steel in the Indian Subcontinent was found

    in Samanalawewa area in Sri Lanka Wootz steel was produced in India by about 300 BC.

    Along with their original methods of forging steel, the Chinese had also adopted the

    production methods of creating Wootz steel, an idea imported into China from India by the

    5th century AD.

    In Sri Lanka, this early steel-making method employed the unique use of a wind furnace,

    blown by the monsoon winds, that was capable of producing high-carbon steel. Also known

    as Damascus steel, wootz is famous for its durability and ability to hold an edge.

    It was originally created from a number of different materials including various trace

    elements. It was essentially a complicated alloy with iron as its main component.

    Recent studies have suggested that carbon nanotubes were included in its structure, which

    might explain some of its legendary qualities, though given the technology available at that

    time, they were produced by chance rather than by design Natural wind was used where the

    soil containing iron was heated up with the use of wood.

    The ancient Sinhalese managed to extract a ton of steel for every 2 tons of soil, a remarkable

    feat at the time. One such furnace was found in Samanalawewa and archaeologists were able

    to produce steel as the ancients did long ago.

    SPONGE IRON

    Sponge iron is a metallic product produced by direct reduction of iron ore or pellets in the

    solid state (i.e., without the material going into the liquid phase as is the case in the blast

    furnace, which is the conventional route for converting iron ore into iron).

    It is also known as Direct Reduced Iron (DRI). The final product after such direct reduction

    contains a large percentage of metallic iron with levels of metallization unto 90% and the

    balance being some amount of reduced iron oxide and the gangue in the ore.

    The Sponge Iron has a highly porous structure when viewed under the microscope and hence

    this product is called Sponge Iron.

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    USE OF SPONGE IRON

    Sponge iron is a part-substitute for steel scrap in the manufacture of steel scrap in the

    manufacture of steel by electric arc furnaces and induction furnaces (i.e., the secondary

    sector).

    Steel melting scrap is primarily required for using as a feed material in aluminium steel

    plants, which also use scrap for melting in electric arc furnaces/induction furnaces for

    manufacturing steel.

    INDUSTRIAL EVOLUTION OF SPONGE IRON

    In India, significant additions to iron and steel capacity were made during the 50s & 60s bysetting up new integrated steel plants at Rourkela, Bhilai, Durgapur and Bokaro, which

    involved large investments in the public sector.

    These plants are based on the conventional route of iron making, using blast furnaces. While

    the initial growth has been quite impressive, the 70's witnessed constraints in further growth

    due to the deteriorating quality as well as limited reserves of metallurgical 'coking' coal, the

    essential feed material for blast furnace and the spiraling capital costs in building

    economically feasible sizes of integrated steel plants.

    In advanced countries, and more so in the developing countries the need to find alternative

    technologies which do not require 'coking' coal for the production of iron and steel was being

    felt.

    However, considering its potential as relevant to the raw material situation, the Government

    of India decided to establish a semi-commercial 'Demonstration Plant' so that raw materials

    available in the country could be extensively tested and processed regimes developed.

    It was envisaged that the demonstration plant would provide the necessary interface for

    developing

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    It could not fulfill industry expectations at that time in being used as a supplementary

    material for feed / alternative to blast furnaces. The main reasons were

    The gas based sponge iron plants could operate only where cheap (subsidized) natural

    gas was made available.

    Sponge iron furnaces could not be developed into a single entity to produce liquid

    metal. Increased scrap availability that was being traded world wide as a furnace raw

    material.

    Blast furnace capacities increased from 0.7 million tons per annum in 1960s to over 4

    million tons per annum. Today the largest gas based sponge iron module available is

    approx. 2.7 million tons per annum.

    GROWTH OF INDUSTRY

    Since the commissioning of the first sponge Iron unit in 1980, it has been a period of notable

    accomplishments for Sponge Iron India Limited which has played vital role in developing

    and establishing coal based DR Technology. Establishment and up gradation of coal based

    Sponge Iron technology in the Country, innovations in the usage of Sponge Iron and its

    conversion into Steel, conversion of waste material into value added products, visualization

    of new concepts for updating technology and the unique expertise in total consultancy for

    establishing new Sponge Iron plants have all contributed to the evolution of Sponge Iron

    India into a 'Technology Corporation'.

    ROLE OF DRI (DIRECT REDUCED IRON) IN INDIAN ECONOMY

    Due to acute shortage of scrap worldwide, sponge iron has become the only alternative feed

    stock for secondary steel making and hence its demand is growing day by day.

    This is a abundantly reflected by the manner in which he price it commands in the market.

    Reducing of iron in to form of round shaped structures called as sponge iron by 2 methods of

    one coal based and another gas based and coal based reduction is popularly known as D.R.I,

    which forms the input for steel manufacturing industry.

    The steel is today considered as the backbone of India economy.

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    The growth of economy has a direct relation with the, Demand of steel. With the present steel

    intensity index, Considering the GDP projection by the Govt. of India, growth of steel

    demand will be around 11% annually.

    Manufacturing process of sponge iron

    The reduction of iron ore either lump ore or pellets can be achieved by using either carbon

    bearing material, such as non-coking coal or a suitable reducing gas in the form of reformed

    natural gas.

    The processes employing coal are known as solid-reactant or coal-based processes, while

    those employing reducing gasses are known as gas-based processes. Sponge iron produced

    by gas-based process is normally hot briquette and hence it is also known as Hot Briquette

    Iron (HBI).

    The choice of coal-based process depends largely on the availability of the reducing agent

    and iron ore/pellets as the case may be. Gas based Sponge Iron Plants are not only capital

    intensive but are also of large capacity in the range of 1.0 to 2.0 million TPA, where as coal

    based Sponge Iron Plants are less capital intensive and can be smaller in size to suit the

    investment requirement.

    PRODUCTION OF STEEL

    It is universally accepted that Indian economy is growing at a very high rate presently and the

    demand for steel is also showing an upward trend.

    No. of units in operation - India 283

    Now DRI units have spread over the states of Orissa, Jharkhand, Chhattisgarh, West Bengal,

    Karnataka, Tamil Nadu, Andhra Pradesh, Gujarat and Goa.

    India is the largest producer of Sponge Iron in the worldIn the year 2006

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    Graph No - 01

    World Major Sponge-Iron Producers

    India- 13.9millionton

    Venezuela - 6.2 million ton

    Iran - 4.3 million tonMexico - 4.5 million ton

    As per the National Steel Policy issued by the Ministry of Steel India will produce 110

    million tons of steel by 2020.

    The requirement of Sponge Iron as metallic will be 30Million tons.

    Projection for metallic requirement:

    Year Route Melting Scrap DRI

    2010-11 Electric Furnace Route 14 million 18 million

    But availability of scrap is not likely to reach 11 million.

    Today India produces 13.9 million tons of sponge iron, out of which 4.2 million ton is gas

    based and remaining 9.7million ton is coal based.

    0

    2

    4

    6

    8

    10

    12

    14

    16

    India Venezuela Iran Mexico

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    India has a proven reserve of 410 million ton of high grade iron ore, another 440 million ton

    of high grade iron ore which will be established. India has total 9992 million ton of iron ore

    reserves (as per IBM report of 1995).

    India has sufficient non-coking coal through of high ash low fixed carbon grade. Coal is used

    as a reducent for sponge iron making in the furnace.

    The availability of scrap of required quantum is unlikely and therefore scraps needs to be

    replaced more and more by DRI.Local supply of scrap is diminishing as generation of scrap

    in India due to improvement of technology is getting continuously minimized.

    As per World Steel Dynamics (WSD) the Global shortage of scrap will reach 68 million

    tons in the year 2010.That means the scrap price will go up and availability will be a

    problem. Today the international price for scrap is around US$ 390.00.

    Due to soaring price of iron ore and coke, blast furnance is being set up in the countries

    where iron ore or coking coal is available.With resources available in IndiaSponge Iron

    Electric Furnace Route is the most viable option for steel making.

    We must produce steel at a cheaper cost to remain competitive and control over domestic

    market. DRI based steel making is therefore the only answer.

    CURRENT RATE OF GROWTH

    The domestic average growth rate has been 21 per cent in the last three years while the global

    growth rate stands at 10 per cent. And the major growth is in the coal-based sector as gas is in

    short supply.

    FUTURE OUTLOOK OF THE INDUSTRY

    Sponge iron will play a key role in the development of steel sector as per national steel

    policy. The industry is very well placed to meet the fast growing demand of metallics.

    Sponge iron is the substitute for steel melting scrap.

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    Scrap availability is getting difficult and the coking coal reserves are limited. So steel

    industry has to depend heavily on sponge iron .India has an installed capacity of 170 lakh

    tonne at present.

    And there are at least 160 more plants in various stages, from planning to implementation. So

    we expect that the installed capacity will go to 3 million tonne in the next five years. Existing

    sponge iron manufacturers are going in for expansion in addition to large number of

    Greenfield projects which are in the pipeline.

    REASON FOR MUSHROOMING OF MINI SPONGE IRON PLANTS

    A 60,000 ton-a-year plant without power generation will cost Rs 24 to 25 crore and a small

    plant of 50 ton-per-day will cost Rs 5 to 6 crore. It is a small investment and that is why

    people are going in for small plants. The margins are also reasonably good.

    They are able to maintain prices but not quality. There is no process control and pollution is a

    main concern as most of them go for coal-based plants and not gas, which is a clean fuel but

    which costs more and availability poor.

    Ninety per cent of the world production is gas-based. Out of the 10 per cent coal-based

    plants, India accounts for 78 per cent.

    MAJOR USERS OF SPONGE IRON

    We cater to electric arc furnaces and induction furnaces. Gas-based plants cater to alloy steel

    makers and steel plants as they need better quality.

    Some of the steel plants have started using sponge iron in blast furnace also to cut down the

    use of scrap or coking coal. This has given a further boost to the demand of sponge iron.

    MAJOR PROBLEMS CONFRONTING SPONGE IRON

    MANUFACTURERS

    Our biggest problem is the availability of critical raw materials, iron ore and coal. Gas

    availability is very difficult. There has been an unprecedented rise in iron ore prices in the

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    last three years. We want export of all high-grade iron ore banned and mining leases be made

    available to private sector so that prices can come down to a realistic level.

    We hope the government will accept the recommendations of the R.K. Dang committee on

    iron ore policy.

    CURRENT DEMAND-SUPPLY SITUATION

    The demand-supply scene is pretty comfortable. Major power cuts in states like Uttar Pradesh

    and Punjab is affecting operation of induction furnaces which has brought down the demand

    and prices along with it.

    This is a temporary phenomenon, but we expect the demand to pick up and prices also to pick

    up in the near future.

    The sponge iron industry looks forward to improvement in the supply of raw materials

    together with better infrastructure facilities to meet the fast growing demand of the steel

    industry.

    FUTURE OF THE INDUSTRY

    Worldwide, recent trends in demand for Steel, due to real estate growth and demand for steel

    in china for the prestigious Olympic games all these have realized the growing potential in

    the Secondary route- Electric Steel making.

    With reduced availability of scrap and the limited scope for further growth in HBI, the only

    answer for providing 'Metallics' to this growing sector lies in coal based DRI. And when it

    comes to coal based DRI, Sponge Iron India Limited, the 'Technology Corporation', can

    provide cost effective solution.

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    GOVERNMENT ASSISTANCE TO INDUSTRY

    Government assistance can be availed through the SIIL (sponge iron India ltd).The spectrum

    of SIIL services include:

    Comprehensive testing of raw materials for the process.

    Preparation of project report for an investment decision.

    Basic and detailed engineering of the reduction unit and all the auxiliaries from raw

    material to preparation to storage and handling of finished products.

    Preparation and selection of mechanical, electrical and instrumentation equipment

    including refractories.

    Inspection of equipment to ensure compliance of specifications and for meeting the

    required standard from operational point of view.

    Assistance in supervision of start-up and commissioning.

    Scheduling and monitoring the implementation of project with assistance in trouble

    shooting during erection and commissioning.

    Assistance in commissioning the plant and optimizing the plant operations.

    Full performance guarantees for achieving rated capacity utilization.

    COAL-BASED AND GAS-BASED

    PROCESSES FOR MANUFACTURE OF SPONGE IRON

    The reduction of iron ore either lump ore or pellets can be achieved by using either carbon

    bearing material, such as non-coking coal or a suitable reducing gas in the form of reformed

    natural gas. The processes employing coal are known as solid-reactant or coal-basedprocesses, while those employing educing gasses are known as gas-based processes. Sponge

    iron produced by gas-based process is normally hot briquette and hence it is also known as

    Hot Briquette Iron (HBI). The choice of coal-based process depends largely on the

    availability of the reducing agent and iron ore/pellets as the case may be. Gas based Sponge

    Iron Plants are not only capital intensive but are also of large capacity in the range of 1.0 to

    2.0 million TPA, where as coal based Sponge Iron Plants are less capital intensive and can be

    smaller in size to suit the investment requirement.

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    COMPANY PROFILE

    BACK GROUND OF THE COMPANY

    RAYEN STEELS PVT limited is located near Haraginadoni village about 16km far from

    Bellary and 5 km far from Kudithini in the state of Karnataka. The plant is located on a plant

    of land measuring about 38 acres.

    Within the short span of time it has achieved an annual turnover of 30 Crores.

    The name Rayenis derived from a roman language meaning flower, it was incorporated at

    the time when there was a raising demand for steel in the global market, it produces Sponge

    iron an intermediate form of Iron Ore and Steel, though it doesnt cater to the international

    market, definitely the growth of Indian economy led to the development of infrastructure for

    which it caters to.

    Rayen Steels has been established on 25th Feb 2006 and it has started its commercial

    production on 20thMay 2006.

    Starting with the initial investment of 14crores, the steel plant was producing 100 tonnes of

    sponge iron per day, which has increased to 250 tonnes in 2008.

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    VISION

    To set up an integrated steel plant of international standards and offer best steel to the global

    market and stand ahead among the steel manufacturers.

    MISSION

    To cultivate high standards of business ethics and Total Quality Management (TQM) for a

    strong corporate identity and brand equity.

    OBJECTIVES

    The following are the objectives of the Rayen Steels (P) Ltd.

    The aims at the fulfilment of the required industrial development in India.

    Committed to delivery products and services to satisfy the need of the customer.

    To actively involve people to contribute towards high productivity through team work

    and innovation.

    It aims at the training and production of skilled personal.

    It aims to contribute towards the economy of the country.

    It aims to provide employment to people directly by the company and indirectly

    through onside contracts.

    Aims to quality maintain and to compute at the global markets.

    To have technology know-how.

    To manufacture cost effective quality Sponge Iron.

    To establish supremacy in Indian Automotive Iron Companies.

    To achieve highest rate of satisfaction among employees.

    To produce zero defect quality Iron.

    To maintain good relation with suppliers, dealers and customers.

    To incorporate special plans and schemes to gain employees satisfaction.

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    QUALITY POLICY

    Rayen steels Limited is committed to comply with the requirements of the Quality

    Management System and to achieve continual improvement in its operations through

    it for the production and marketing of sponge iron.

    In order to attain this, the company shall strive to achieve its quality objectives

    through annual business plans and review the quality policy periodically to ensure its

    continuing suitability to company operations.

    NATURE OF THE BUSINESS CARRIED

    Rayen Steels Pvt. Ltd, is a company which involves in producing sponge iron as a raw

    material for the steel manufacturing industries.

    This product was used initially in Induction furnace as a reducing agent for reducing Carbon

    in the scrap. Later on Sponge Iron is used as a raw material along with scrap.

    It produces high quality sponge iron. It supply high grade material of Sponge Iron to major

    steel industries such as Ispat Industries Bombay, JairajIspat Hyderabad, and so on

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    PRODUCT PROFILE

    The sponge iron plant at Bellary produces the following product:

    Main product: Sponge Iron

    Byproduct:Slag,Blastfurnacegas

    The quality of the Sponge Iron is determined by its Silica content. The more the silica content

    more the quality, the silica ranges from 1 percent to 3.5 percent. The company manufactures

    three grade of Sponge Iron, they are as follows:

    Fines (Injection coal)

    A- Grade

    B- Grade

    A-grade and B- Grade is used in the manufacture of steel. It is produced by the

    Integrated Steel Plants (ISP) for captive consumption in the manufacture of steel and

    exports. Part of production is also divers tic market. Used for making casting and isproduced in the mini Blast Furnace Units. .

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    Requirement of raw materials and their possible source of supply are indicated in the

    table given below

    Sl.No. Raw materials Sources of Supply

    1. Lump iron ore

    (5mm-20mm)

    Sandur

    2. Coal Singareni collieries/south Africa

    /Australia/Indonesia

    3. Dolamite Dronachalam

    Table 2.1 showing the raw materials and their sources of supply

    AREA OF OPERATION

    As Rayen steels is a small scale industry it function only in the national market sells

    production capacity then they go for export in the best price.

    COMPETITORS INFORMATION

    The major competition they face is from the local manufacturers. And a small range of

    competition from other national firms.

    The local competitors are:-

    a) HOTHUR STEELS

    b) PRAGATHI

    c) SARJELLI STEELS

    d) BINACA STEELS

    e) BELLARY STEELS & ALLOY LTD

    f) GAYATHRI METELS

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    INFRASTRUCTURE FACILITIES

    38 Acres of land

    Building in square feet:- 40000 Sq.feet

    Machinery worth Rs:-2crore.

    Furniture Worth Rs: - 1lakhs.

    Computer aided Machinery worth Rs:-3lakhs.

    L&T JCB Rs:-18 lakhs.

    New technology adoption.

    Killen & Coolers.

    Stock House 10,000 Tonnes.

    Storage Shed 180 Tonnes.

    Heavy machinery like Hitachi, Jeb, Roller.

    WATER FACILITIES

    There is a hot well and cold well of supply and return water storage from cooler where

    sponge iron is cooled separately. Pumps are provided for circulation, cold water to cooler

    and hot water through cooling tower. The other requirements like for cooling compressor etc.

    is met from the ground water reservoir directly. An overhead tank is provided in the plant to

    meet the water requirement for about half an hour during emergency, like power failures, fire

    etc. This overhead tank has one separate compartment to store and supply drinking water to

    the plant& personnel.

    COMPRESSED AIR FACILITIES

    To meet the demand of compressed air, two water cooled compressor of 400 cfm and at a

    discharge pressure of 6 kg/cm sq is installed. This compressed air is used for operating the

    grease pumps and the pneumatic seals to kiln and cooler.

    For distribution of compressed air to different consuming points, an adequate distribution net

    work of pipelines has been provided.

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    VENTILATION AND AIR CONDITIONING FACILITIES

    The main system of ventilation for most of the buildings is naturally ventilated. Mechanical

    ventilation is provided in such premises where natural ventilation cannot provide the desired

    effect. The control room shall be centrally air conditioned. Local exhaust fans are provided

    where necessary for removing objectionable fumes and vapors. De-dusting system has been

    considered for removing dust generated at transfer points in the handling, transportation of

    raw materials and finished products. Exhaust ventilation are provided for the switch gear

    room of the main step down sub-station, transformer station, store room and toilets.

    POLLUTION CONTROL FACILITIES

    WATER POLLUTION

    Adequate effluent handling, treatment and disposal measures have been taken to conform to

    prescribed norms. The waste water after treatment would be discharged into the storm water

    drainage system, chemical wastes from laboratory, will be neutralized before discharging into

    the sanitary sewerage treatment system.

    A) Noise pollution controlDue to technological reasons, it may not be practicable to entirely eliminate the noise.

    However, noise levels could be brought down to the acceptable level wherever

    possible. The major equipment of high noise production can be identified as ID fan,

    de-ducting fan of Sponge Iron Plant, compressors in compressed air station,

    ventilation fans, etc.

    Various measures like reduction of noise at source, providing acoustic lagging for theequipment, isolating the noise producing equipment etc would be adopted to reduce

    the noise pollution from this equipment. The compressors in the compressed air

    station would be provided with suction side silencers.

    Ventilation fans would generally be installed in enclosed premises. Supply ducts and

    grills on the ventilation and air conditioning system would be suitably sized for

    minimum noise level.

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    B) Dust emissions and control

    From the transfer points at crushing, screening, cooler discharge and product

    separation, some quantity of dust is eliminated. To avoid the pollution of the

    environment, the de-dusting points are provided at these three places. In this system,

    the suction ducts are provided at various points and connected to a bag filter house.

    One ID fan is used to create suction and the dust particles collected in the hopper are

    drawn out with the help of a rotary valve, for humidifying the dust to avoid flying of

    the same.

    POWER REQUIREMENT FACILITIES

    The power requirement of the proposed Sponge Iron Plant is estimated as 1500 KVA on 30

    minute maximum demand arsis with an annual energy consumption of 5 million KWH. HT

    power shall be made available at plant site by KEB.

    One set of 500 KVA rating at 415 V, 50 Hz is provided to cater to the emergency power

    requirement of vital units of the plant requiring uninterrupted power supply. The DG set will

    be complete with auxiliaries like AMF panel, day oil storage with transfer pumps etc, and

    necessary instrumentation.

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    Work Flow Model

    1. Raw material

    2. Screening

    3. Crushing

    4. Store house

    5. ABC Unit (After burning chamber )

    6. Klin

    7. Cooling house

    8. Production house

    Raw material Screening Crushing

    Store house

    ABC Unit (After

    burning

    chamber

    Klin

    Cooling house Productionhouse

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    The following chart show entire process

    Chart 2.1 Chart showing production process

    STOCK HOUSE (RAWMATERIALS)

    FEEDBELT

    KILN MAIN

    DRIVE

    PROCESS

    COOLING

    SPONGE

    IRON

    LABTESTING

    CD BELT

    PRODUCT HOUSE

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    The main component in this production process is Kiln. The following are main components

    are included in the kiln.

    Kiln main drive: It is used for rotating kiln.

    Cooler main drive: It is used for cooling after all process the products should be

    cool.

    Sheller fan: it is used for controlling temperature that is increasing or decreasing the

    temperature.

    Lube compressors: it is used for coal feed into Kiln by pressure.

    Iron weighing feed: it is used for transfer raw materials into kiln.

    ESP ID fan:it is used for maintaining a pressure.

    Feed coal range:it should be range +14-1

    CB Fan: it is used for output increasing to temperature RACF: Rotary Air Lock of

    System.

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    ORGANIZATION STRUCTURE

    MANAGING

    DIRECTOR

    EXECUTIVE

    DIRECTOR ADMIN

    BORAD OF

    DIRECTORS

    LABORATORY

    DEPARTMENT

    QUALITY

    DEPARTMENT

    STORES & RAW

    MATERIALS

    DEPARTMENT

    PRODUCTION

    HOD

    HUMAN

    RESOURCE

    HOD

    MARKETING

    HOD

    FINANCE

    HOD

    EXECUTIVE

    DIRECTOR PLANT

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    OWNERSHIP PATTERN OF THE COMPANY

    Name Designation Age Qualifications Experience and Expertise

    Mr.Obul

    Reddy. P

    Director 65 B.Com, M.B.A, Over 18yrs in High Power

    transmission line constructions

    in Karnataka

    Mr.Prakash. S Director 63 B. Tech

    (Metallurgy)

    About four decades in Iron and

    steel Industry.

    Mr.Manohar. A Director 68 B.com, MBA Over 35 years in commercial

    Bankig, Human Resources and

    financial Management with state

    Bank of India.

    Mr.Ramu .G Director 67 B. Tech (chem),

    MBA.

    Over 15yrs in Sales and

    Distribution of UB spirits in

    entire north Karnataka region.

    Table 3.1 Table showing ownership pattern of the company

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    FUNCTIONAL DEPARTMENTS

    The following are the various departments playing a vital role in the success of the Rayen

    Steels Pvt Ltd. They are as follows:

    Finance Department

    Marketing Department

    Human Resource Department

    Production Department

    Stores & Raw Materials Department

    Quality Department

    Laboratory Department

    Functional Department Chart

    Finance

    Department

    Marketing

    Department

    Human

    Resource

    Department

    Production

    Department

    Stores &

    RawMaterials

    Department

    Quality

    Department

    Laboratory

    Department

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    FINANCE DEPARTMENT

    Finance department is that managerial activity which is concerned with planning and

    controlling of the firms financial resources. The manager of this department is Mr.

    S.R.Kolkar

    Account and cash section

    In this department, the accounts section maintains all the transactions related to the

    factory dealings. The sale accounts, purchase accounts, etc are maintained and this

    department prepares P&L account, Balance sheet, etc.

    The accounting system followed by RSPL in such a way that there will be separate

    ledger has kept for each customer. As the concern will deal with many customers,

    there will be a separate ledger maintained in the name of each client and sometimes if

    the client deals with many varieties of products for that will be a separate file has been

    maintained

    Capital cost:

    The esteemed capital cost of plant is Rs. 1473.33 lakhs (inclusive of taxes and duties).

    This includes land, civil/structural work; the cost has been arrived based on prevailing

    rates for estimated quantities.

    As for plant and machinery it is based quotations/offers received for similar plant of

    our other clients/s. Apart from all directors investments, this project was financially

    supported by Andhra Bank, at the ratio of 25:75 respectively.

    From the bank finance 80% is allocated to project cost and 20% towards working

    capital. The monthly average turnover is 5 crore

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    Structure of the Finance Department

    Finance HOD

    Manager

    Supervisor

    Staff

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    SALES FOR THE PERIOD APRIL 2009 TO JULY 2009

    Graph 4.1 Showing sales for the period April to July

    0

    1000

    2000

    3000

    4000

    5000

    6000

    7000

    LUMPS FINES

    Series1

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    SALES FOR THE PERIOD AUGUST 2009 TO NOVEMBER 2009

    Graph 4.2 Showing sales for the period August to November

    0

    1000

    2000

    3000

    4000

    5000

    6000

    7000

    8000

    9000

    LUMPS FINES

    LUMPS FINES

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    SALES FOR THE PERIOD DECEMBER 2009 TO MARCH 2010

    Graph 4.3 Showing sales for the period December to March

    0

    2000

    4000

    6000

    8000

    10000

    12000

    LUMPS FINES

    LUMPS FINES

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    MARKETING DEPARTMENT

    Introduction

    Marketing is a social process by which individuals and groups obtained what they need andwant through creating, offering and freely exchanging products and services of value with

    others.

    Aim of marketing

    To know and understand the customer so well that the product or service first him and sells

    itself. Ideally marketing should result in customer who is ready to buy. All that should be

    needed then in to make the product or service available.

    Features of marketing

    It is consumer oriented.

    It starts and ends with consumer.

    It is goal oriented.

    It is a continue process.

    It is a guiding element of business.

    Distribution channels

    It is a channel of distribution group of individuals and organization that direct the

    flow of products from producers to customers. The main function of this demand is to find

    out the appropriate ways through which goods are made available to the market.

    There are so many marketing channels.

    Vertical marketing system.

    Horizontal marketing system.

    Multi-channel marketing system.

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    In the last type of channel there are other distribution channels like

    DIRECT MARKETING CHANNEL

    Manufacturer Consumer

    1 level marketing channel

    Manufacturer Retailer Consumer

    2 level marketing channel

    Manufacturer Whole seller Retailer Consumer

    3 level marketing channel

    Manufacturer Whole Seller Jobber Retailer Consumer

    Objective

    The main objective of this department is to take care of the sales and dispatching them

    properly and also to look after the central excise matters pertaining to the sales of the

    department.

    Policies

    1. Keep a watch on the market conditions.2. Branch officials and agents should always be in touch with customer.

    3. RAYEN always prefer to have direct contact with the plot owners for timely supply of

    raw materials.

    4. Orders are always taken on first cum first basis and credit sales are negotiated only

    after knowing buyers credibility and prior approved of management.

    5. The transporter approaches marketing section for billing and other various document

    required as per government rule.

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    Practices/Procedure

    1. Only those employees who know the local language are sent to the customers.

    2. Marketer makes the customer to know the quality checks done at RAYEN.

    3. The customers financial strength and weakness and requirements are known to the

    branch officers and agents.

    Structure of the Marketing Department

    HEAD OF THEDEPARTMENT

    MANAGER

    SUPERVISORS

    STAFF

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    HUMAN RESOURCE DEPARTMENT

    Human resources management involves researching and addressing staffing needs, hiring and

    training the best employees and making sure that these employees turn out to be outstanding

    performers. It also includes dealing with performance issues and ensuring employees

    personal and management practices conforms to various regulations.

    In short Human resources management, this is of immeasurable value for an organization.

    The HRM department is entrusted with the vital function of keeping employees happy and

    thus assisting in enhance the productivity of the company.

    Any organization with manpower as its chief capital is a treasure of talent. It is the HR

    department which acts as the key to unlock, identify, develop and utilize employee skills and

    talents to further individual as well as organizational goals.

    The chief functions of the HR department Training and Development change the

    management, salary and benefits, industrial and employee relations and performance

    appraisal.

    The HRM department here at Rayen steels Pvt Ltd., considers the employee as the foremost

    and the major resources of the company. Upliftment of employees growth are at the center of

    organization philosophy of growth, which aims at providing a career in which the individual

    can make at the same time better standard.

    Company has taken care of employees welfare by Providing accommodation medically and

    medicalreimbursement to self and family subsidized canteen facility to all employees, freetransportation to their residence to the work. Place.

    Company is having officers, club members of their facilities meet and participating in various

    activities of recreations.

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    Company plans to increase turnover per employee through

    Increase production

    Increase productivity

    Maintain / Improve quality

    Cost efficiency

    Adhering to timely suppliers

    Reduction in wastages

    Structure of the Human Resource Department

    HEAD OF THE

    DEPARTMENT

    MANAGER

    SUPERVISORS

    STAFF

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    PRODUCTION DEPARTMENT

    The raw materials and the technology are to be sourced from other areas; this is a specialized

    field where in the production of steel, a definite layout of the process has to be established.

    These are charged into a rotary kiln in requisite proportion along with some dolomite.

    Coal plays a dual role in the process by acting as a reductant as well as a fuel for providing

    heat to maintain the requisite temperature inside the kiln at 950-1050C. The reduction process

    occurs in solid state. The crucial factor in this reduction process is the controlled combustion

    of coal and its conversion to carbon monoxide to remove oxygen from the iron ore

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    PRODUCTION PROCESS

    Sponge Iron is iron ore reduced directly in solid state using coal gas, natural gas or coal as

    reductants and is also known as Directly Reduced Iron (DRI). The basic raw materials used

    in the production of Sponge Iron are Non-coking coal, Iron ore, and dolomite, with the

    availability of new technology they are able achieve greater efficiency with following

    advantages.

    Uniform known composition and Low levels of residuals/tramp elements

    Capability to maintain phosphorous level in steel within 0.002% and sulphur in

    sponge manufacturing

    Low content of dissolved gases, Uniform size and higher bulk density as compared toscrap

    Capability of forming protective cover of foamy slag in the bath

    Chemical Composition

    Constituent Percentage %

    Total Iron 65-67%

    Sio2+al2o3 2-3%Cao+mgo 0.5-1%

    Sulphur 0.02%max

    Phosphorous 0.04%max

    Table 4.1 Showing the chemical composition of iron ore

    Physical Composition

    Constituent Percentage %

    Size 5-20mm

    Shatter Index +95%

    Tumbler Index +88%

    Abrasion Index +5%max

    Reducibility Index +94%

    Thermal degradation Index 5%

    Table 4.3 showing the physical composition of the iron ore

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    Various technologies that can be used are:

    Gas Based Technologies

    Coal based process

    Fluidized Bed Technologies

    Technologies using hydrogen as reductant, or using carbon monoxide as reductant

    Technologies using mixture of both hydrogen and carbon monoxide as reductant

    Static or moving bed technologies using mixed gas as reductant

    Coal-Based Process

    This is the process that the company uses to produce sponge iron. This process utilizes non-

    coking coal as reducing agent along with lumpy rich grade iron ore. The reduction is carried

    out in an inclined horizontal rotary kiln, which rotates at a predetermined speed.

    A temperature profile ranging from 800-1050 degree centigrade is maintained along the

    length of the kiln at different zones and as the material flows down due to gravity the ore is

    reduced.

    The hot reduced sponge iron along with semi-burnt coal, discharged from kiln is cooled in

    water-cooled cylindrical rotary cooler to a temperature of 100200 degree centigrade.

    The discharge from cooler consisting of sponge iron, char other contaminations are passed on

    through magnetic separators so that sponge iron can be separated from other impurities.

    Later the sponge iron is screened into two size fractions i.e. 3 mm & +3 mm. +3 mm

    fraction directly goes for usage, -3 mm fraction can be either used directly where ever it is

    possible or is to be briquetted by using molasses and hydrated lime as binders.

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    The output compositions are as follows:

    Composition Percentage %

    Total Iron 91 - 93 %

    Metallic Iron 80 - 84 %

    Metallization 90 - 92 %

    Gangue 3 - 4 %

    Carbon 0.25 %

    Sulphur 0.02 - 0.03 %

    Phosphorous 0.035 - 0.05 %

    Table 4.4 showing the output composition

    Basic Reactions

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    QUANTITY USED IN MANUFACTURE FOR THE PERIOD APRIL

    2009 TO JULY 2009

    Chart 4.1 Quantity used for the period April to July

    IRON ORE

    COAL

    DOLAMITE

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    QUANTITY USED IN MANUFACTURING FOR THE PERIOD

    AUGUST 2009 TO NOVEMBER 2009

    Chart 4.2 Quantity used for the period August to November

    IRON ORE

    COAL

    DOLAMITE

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    QUANTITY USED IN MANUFACTURING FOR THE PERIOD

    DECEMBER 2009 TO MARCH 2010

    Chart 4.3 Quantity used for the period December to March

    Chart 4.2 Quantity used for the period December to March

    IRON ORE

    COAL

    DOLAMITE

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    RAW MATERIALS DEPARTMENT

    As in case of any process, here also quality of raw materials plays a vital role in

    obtaining the rated capacity and product quality. The raw material required to produce

    Sponge Iron are as follows:

    Iron Ore

    Coke

    Dolamite

    The iron ore shall have resistance for physical & thermal decrepitating and good

    reducibility and the coal should be of reactive nature along with the characteristics of high

    fusion temperature and less amount of ash.

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    Sized iron ore, sized coal and sized limestone will be received from the mines/suppliers

    directly by road unloaded and stocked in the raw material yard.

    The material will be withdrawn by means of pay loader and tippers and unloaded into the

    ground hoppers. From the ground hoppers, the materials would be conveyed to respective

    vibrating screens by means of belt conveyors and ultimately the sized material would be

    stored in the earmarked day bins.

    One road weight bridge would be provided for weighing all the incoming materials to the

    storage yard and outgoing materials from the storage yard.

    As the company imports the raw materials from far places such as South Africa and chinaapart from the neighbouring states, it becomes imperative that there should be a well

    designed inventory control system.

    The company in order to supply to its customers on the national basis needs a system of

    logistics where the consignments are delivered at right time to the customers; it can be either

    on road, rail or even sea.

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    PURCHASE OF RAW MATERIALS FOR THE MONTHS

    APRIL 2009 TO JULY 2009

    Graph 4.4 Showing the purchase of raw materials for the months April to July

    0

    2000

    4000

    6000

    8000

    10000

    12000

    14000

    16000

    IRON ORE COAL DOLAMITE

    IRON ORE

    COAL

    DOLAMITE

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    PURCHASE OF RAW MATERIALS FOR THE MONTHS

    AUGUST 2009 TO NOVEMBER 2009

    Graph 4.5Showing the purchase of raw materials for the months August to November

    0

    2000

    4000

    6000

    8000

    10000

    12000

    14000

    16000

    18000

    IRON ORE COAL DOLAMITE

    IRON ORE

    COAL

    DOLAMITE

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    PURCHASE OF RAW MATERIALS FOR THE MONTHS

    DECEMBER2009 TO MARCH 2010

    Graph 4.6Showing the purchase of raw materials for the months December to March

    0

    2000

    4000

    6000

    8000

    10000

    12000

    14000

    16000

    IRON ORE COAL DOLAMITE

    IRON ORE

    COAL

    DOLAMITE

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    STORES DEPARTMENT

    To meet operation requirement of the plant one central store is provided to store various

    materials consumables and spares they are as follows:

    Equipment

    Conveyor belts

    Grease

    Lubricants and

    Refractors

    Nearly 70 lakhs of materials are stored. There 3 Shifts manager, data entry operator and 2

    helpers. The main functions of this department are as follows:

    Inspecting the raw materials

    Entering the details in to the system

    Arranging the materials in the racks.

    QUALITY DEPARTMENT

    Sponge iron manufacture is highly sensitive to raw material characteristics. The basic raw

    materials for the production of sponge iron are iron ore, non-coking coal and dolomite.

    Several tests are conducted in the company laboratory to ascertain their suitability in a rotary

    kiln. After conducting tests according to their chemical and physical composition they are

    graded.

    The company now is in the process of implementing the ISO-9002 standards and is awaiting

    the certification from the auditing authorities.

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    LABORATORY DEPARTMENT

    It is like the heart in a human body for the organization. It is essential to examine the

    chemical and physical characteristics of raw materials, both individually and in combination.

    The quality of incoming raw material and finished products are tested here. If this department

    discharge duties properly the efforts/ operations fails.

    Laboratory equipments required are as follows:

    Jaw crusher/roll crusher,

    Discpulveriser,

    Muffle furnace,

    Drying cabinet,

    Rotary sieve shaker,

    C and S apparatus,

    Satmagan,

    Electronic balance and glassware.

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    THE MCKINSYS 7S FRAME WORK

    Its all very well devising a strategy, but you have to be able to implement it if its to do any

    good. The Seven S Framework first appeared in The Art of Japanese Management by

    Richard Pascale and Antony Athos in1981. They had been looking at how Japanese industry

    had been so successful, at around the same time that Tom Peters and Robert Waterman were

    exploring what made a company excellent. The Seven S model was born at a meeting of the

    four authors in 1978. It went on to appear in In Search of Excellence by Peter and

    Waterman, and was taken up as a basic tool by the global management consultancy

    McKinsey: its sometime known as the McKinsey 7S model.

    Managers, they said, need to take account of all seven of the factors to be sure of successful

    implementation of a strategylarge or small. Theyre all interdependent, so if you fail to pay

    proper attention to one of them, it can bring the others crashing down around you. Like a lot

    of these models, theres a good dose of common sense in here, but the 7 S Framework is

    useful way of checking that youve covered all the bases.

    To better represent the challenges of service marketing McKinsey developed a newframework for analyzing and improving organizational effectiveness, the 7s model:

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    SOFTS

    The 4Ss across the bottom of the model are less tangible, more cultural in nature, and were

    termed Soft Ss by McKinsey:

    Skills: The capabilities and competencies that exist within the company. A skill is an

    individual ability to translate knowledge into action. The aim of organization is to

    provide quality to their customer satisfaction, consistent quality to all.

    Shared value: The values and beliefs of the company. Ultimately they guide

    employees towards valued behavior.The company produces good quality products

    for which it has also received many award.

    Staff: The Companys people resources and how they are developed, trained andmotivated. Staffing is the process of acquiring human resource for the organization

    and assuring that they potential to contribute to the achievement of the organization

    goals. Staffing includes the selection, placement, training and development of

    appropriate qualified employees.

    Style: The leadership approach of top management and the companys overall

    operating approach.

    HARDS

    The 3S across the top of the model are described as Hard Ss:

    Strategy: It refers to the set of decisions and actions at gaining a sustainable

    competitive advantage the direction and scope of the company over the long term.

    Structure: The basic organization of the company, its departments, reporting lines,

    areas of expertise and responsibilities (and how they inter relate).

    System: Formal and informal procedures that govern everyday activity, covering

    everything from management information systems, through to the system at the point

    of contact with the customer (retail systems, call center systems, online system etc)

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    Strategy

    Skills

    Staff

    Style

    System

    Structure

    Shared

    Value

    Description of 7-S Model

    STRUCTURE

    Definition of Structure:

    Structure describes the hierarchy of authority and accountability in an organization these

    relationships are frequently diagrammed in organizational charts. Most organizations use

    some mix of structures- pyramidal, matrix or structured onesto accomplish their goals.

    A structure is the formalizing of relationships, roles and responsibilities in order to recognize

    and perform work.

    In simple terms, structure is a pattern in which various parts or components are inter-related

    and inter-connected. So, organization structure is a pattern of relationships among various

    activities and positions. Because various people hold these positions, the structure defines the

    relationships among people in the organization

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    Organizational structure performs in the following major functions:

    The overall responsibility for the safe and efficient operations at the location shall rest

    with the location in charge.

    However all the officers working at the location shall have the following functions as

    entrusted by the location in charge from time to time.

    Implement all the statutory requirements related to receipts storage and dispatch of

    product. Impart adequate training to all subordinates enabling them to perform their

    duties satisfactorily.

    Develop and maintain good relationship with all customers and other connected

    agency.

    It undertakes a wide variety of activities through devices such as departmentalization,

    specialization, division of labor of delegation of authority.

    The manager of the company is in a position to control the activities of different

    department on the organization.

    For taking the entire problem he meets the knowledge of about both technical and

    managerial knowledge.

    The employees of each department is responsible for the activities done in their

    respective departments and answerable and reporting to the department manager.

    In the organization the department manager comes under the top level management.

    Under these position technical officer, sales officer, accounts officer and

    administrative officer are present they comes under the middle level management and

    other workman, security guards and clerks comes under the lower level management

    of the organization.

    In RAYEN, each department is interlinked with other departments has to maintain a

    good control with other departments

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    STRATERGY

    It refers to the set of decisions and actions at gaining a sustainable competitive advantage.

    OBLIGATIONS

    Towards customers and suppliers:

    To provide prompt, courteous and efficient service and quality products at fair and

    reasonable prices.

    Towards suppliers:

    To ensure prompt dealings with integrity, impartiality and courtesy and promote

    ancillary industries.

    Towards employees:

    Develop their capability and advancement through appropriate training and career

    planning.

    Towards community:

    To develop techno-economically viable and environment-friendly products for the

    benefit of the people.

    Encourage progressive indigenous manufacture of products and materials so as to

    substitute imports.

    To ensure safety in operations and highest standards of environment protection in its

    manufacturing plants and townships by taking suitable and effective measures.

    Financial objectives:

    To ensure adequate return on the capital employed and maintain reasonable annual

    dividend on its equity capital.

    To ensure maximum economy in expenditure.

    To manage and operate the facilities in an efficient manner so as to generate adequate

    internal resources to meet revenue cost and requirements for project investment,

    without budgetary support.

    To develop long-term corporate plans to provide for adequate growth of the activities

    of the corporation.

    To endeavor to reduce the cost of production of sponge iron by means of systematic

    cost control measures.

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    SYSTEM

    System refers to all the rules, regulation and formal procedure and informal that complement

    organizational structure. It includes buying and selling, planning and control system, capital

    budgeting system, recruitment, training and development schemes.

    In RAYEN there is a separate department to plan and control the buying activities in this

    department the organization has to account for how much raw materials the trucks have to

    bring. The buying is planned according to demand of the sponge iron in the market.

    Recruitment is the process of searching prospective employee and the recruitment of

    employees are carried out at the head office, Bellary in the human resources department. In

    case of vacancies or in case of appointing from outside, the RAYEN recruit people throughconsultancies, employment exchange and sometimes it will be published in news papers.

    They conduct interview. The qualified suitable candidates selected to the right job.

    TRAINING AND DEVELOPMENT

    RAYEN takes up training and development activities in an integrated way, which includes all

    level of employees. Training needs of various levels of employees are assessed on the basis

    of manpower planning discussions are also held between manager and employees forassessing training needs.

    All the personal selected for operation department shall be thoroughly trained before getting

    independent assignments especially for the automated terminals.

    The location in charge will ensure that all other personal working. In the working location

    receive adequate training in all functions of operation.

    They conduct lecture and meetings.

    The minimum period of training varies from a week to a month (according to the nature and

    complexity of the job).

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    STYLE

    Style of the organization is the evident through the patterns of actions taken by the member of

    the top management team over a period of time. Reporting relationships may also convey the

    style of the organization.

    Leadership style of managers of RAYEN STEELS PVT LTD

    Maintain discipline in the organization.

    Gives instructions and orders to the subordinates.

    Listened to subordinates and responds to their needs.

    Takes important decisions for the group.

    Maintain unity in the organization.

    Inspires and motivates the various members of his group.

    Achieve or formulate objectives for his groups.

    Maintain communication in the organization.

    The manager plays a vital role (top management). The manager of the department takes all

    the plans, policies, procedure, etc.

    The department heads like marketing, security, finance, R&D, HR, and buying has the

    authority to take decisions regarding their department. It is said, Whenever some

    responsibility is given some authority should be given.

    Like manager takes decisions regarding sales, dealers of different marketing strategies. Like

    this finance manager takes the decisions regarding preparing profit and loss A/C and Annual

    Report of the corporation.

    It has very good quality circle program through which the employees and workers areallowed to discuss any existing problem or can healthy suggestion regarding any problems to

    the department manager. This will build healthy relationship between manager and

    subordinates and workers.

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    SHARED VALUES

    It refers to set of values and aspiration that goes beyond the conventional formal statement of

    corporate objectives. The organizational cultures can be viewed as system of shared values.

    In Rayen steels every employee has to participate in taking the decision in the organization.

    The finance department has to maintain proper accounts. The main aim of employee is to

    develop the organization, their activities and their public service with efficiently.

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    SWOT ANALYSISSWOT ANALYSIS OF RSPL

    SWOT Analysis is an important tool for auditing the overall strategical position of a business

    and its environment. A scan of the internal and external environment is an important part of

    the strategic planning process. Environmental factors internal to the firm usually classified

    into Strengths (S), Weaknesses (W), and those external to the firm are classified as

    Opportunities (O), Threats (T). Such an analysis of the strategic environment is referred to as

    SWOT analysis.

    The SWOT analysis provides information that is helpful in matching the firms resources and

    capabilities to the competitive environment in which it operate. As such, is instrumental in

    strategy formulation and selection. The following diagram shows how a SWOT analysis fits

    in to an environmental scan:

    SWOT ANALYSIS FRAMEWORK

    ENVIRONMENTAL

    SCAN

    INTERNAL

    ANALYSIS

    STRENGTHS WEAKNESSES

    EXTERNAL

    ANALYSIS

    OPPOTUNITIES THREATS

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    The Strengths, Weakness, Opportunities and Threats of RSPL are as follows:

    Strengths

    RAYEN STEELS PVT LTD is a reservoir of skilled and experienced personnel. The Company has got an advantage of its location, as the plant is situated where

    resources are easily available.

    RAYEN STEELS is located near the major power generating stations both hydra

    and thermal like Raichur, Munirabad, Shalvathe and Kalinga all these stations are

    connected to the grid at Munirabad about 55kms from Bellary.

    Commissioning the sponge iron plant as reduced the dependability on scrap.

    Company maintains high quality standards so that profitability is increasingyearly. The company can have the competitive advantage over its competitors. It

    will help in influencing and mobilizing market demand for the product.

    Good corporate image of RAYEN enhances the level of confidence in manager.

    Abundant resources of iron ore which is also closer to the plant, hence reduces

    transport cost.

    RAYEN has a customer friendly approach and improved customer orientation.

    Non-existence of labour unions.

    Customer percentage of RAYEN is fair and of reliable supplier.

    Market demand for sponge iron is more.

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    Weakness

    The absence of certain strengths may be viewed as a weakness. In some cases, a weakness

    may be the flip side of the strength. The weaknesses of RSPL are as follows:

    RAYEN is largely dependent on bank loans rather than other sources.

    Concentrated on south India market and neglected other parts.

    It has to depend on other sources for the procurement of raw materials.

    RAYEN is facing a lot of problems like transportation, diesel& fuel, break downs,

    Etc

    Lack of implementing the new technologies like computerization in all

    departments. The factory machines are old, obsolete and break downs are common and it is

    leading to maintenance cost the company has to fallow the preventive

    maintenance in the organization.

    The nature of the process operating cost very high, so that it requires huge

    investment.

    Water is very essential for the process of extracting sponge iron which is being

    pipelined in about 4Kms through plastic pipes, there are chances for the pipe tobreak and also maintenance is difficult.

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    Opportunities

    The external environmental analysis may reveal certain new opportunities

    Efforts are on for reducing the power cost, which is key element in the processof sponge manufacture.

    Since RAYEN has wide network of traders, it can supply its product directly to

    customers without any difficulty.

    This year RAYEN has given very good performance, so it will imbibe a new

    enthusiasm in its employee to do better.

    Due to economic improvement in conditions especially infrastructure building

    in the country. That can enhances the demand for the iron industry andcompany can utilize consumption from the untapped market.

    Company will grow due to its healthy conditions because it has all material

    resources near to its location that will lead easy consumption of raw materials

    and finally it reduces the cost of production.

    It can expand its business to Power Plant as the company has the by product

    which can be used for electricity generation. The byproduct can be utilized for

    the betterment of the company which will yield competitive advantage to the

    organization.

    Steel industries such as Jindal, Kalyani and Mukunda have come up in Bellary

    region from which demand for sponge is more.

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    Threats

    In this era of globalization competition has become one of the driving forces in each and

    every industry. RSPL has also threats from other industries

    Increased competition in the market with other domestic producers.

    Obsolescence of existing technology.

    High cost of input materials. The cost of raw materials is increasing due to

    import from the south Africa which inturn effects the cost of production.

    Tight money market situation.

    Less accumulation of funds from promoters.

    They cannot change the selling price of the product as it is fixed by SpongeIron Association.

    The steel pricing policy of the government is also big threat to the company

    usually the levy prices fixed by the government are very low and fall below

    the cost of production.

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    LEARNING EXPERIENCE

    The training has created a sense of practical exposure and enlightenment in my mind as to

    what actually an organization is and how theoretical concepts are practiced in with only

    theatrical knowledge, several management concepts were slightly difficult to analyze.

    However, after implant training, I have felt empowered with confidence to understand

    different management concepts in a pragmatic manner.

    The training helped me a lot in recalling the theoretical concepts, which I learnt in my 1st

    year MBA. I also came across real problems faced by organization in technology, human

    resources etc and the way in which the management tackled those problems.

    During this implant training, I realized that management is a backbone of every organization

    and without which every activity of organization will go haywire.

    I came to know the importance of Management Information System [MIS] in the

    organization and how it assists the management in every aspect of its business and how it

    helps the management in the process of decision-making.

    I came to know how communication acts as an important tool for the smooth functioning of

    the organization and how we should communicate on different channels and with differentgrades of peoples.

    As we all know that finance is lifeblood of every organization, I personally had a look at the

    finance department, I came to know the importance of finance department, and I came to

    know the different tools they use to have a control over the liquidity position of the company.

    I came to know the importance of Managerial Knowledge such as planning, organizing,

    staffing, directing, controlling, and decision-making. I came to know about the rules,

    regulation, policies, and procedures of the company, and to what extent employees are

    following the rules and regulation laid down by the management. I came to know about the

    punitive actions taken by the management against the individuals who breaks the rules and

    regulation of the company.

    Apart from these I also came to know about the Leader ship traits such as ability to motivate,

    counsel and train sub-ordinate in a humane approach to their problem, develop personnel

    support and team spirit.

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    In training also helped me in knowing the importance of group effort when compared to

    individual effort in organization. In addition, importance of human relations was known,

    which helps the management getting the things done through its employees.

    Personally, I gained many valuable insights in Rayen Steels (P) Ltd., which help in my

    career. It is about the working environment, about dealing with the employees, about the

    attitude required to sustain in an organization and so on.

    In total, I am very much benefited with this implant training. Once again, I thank the

    authority of Rayen Steels (P) Ltd. of giving me this opportunity to carry out the implant

    training and expose myself to the corpor ate field and I thank all employers of Rayen Steels

    (P) Ltd. and as well as who are helping and for giving me continuous guidance to make this

    project work successful.

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    FINDINGS, SUGGESTIONS AND CONCLUSION

    FINDINGS

    The company does not have the effective control on the contract based employees in

    the organization.

    The cost of production can be reduced through introducing new technology in the

    organization. This will lead to control of the cost of production and it influences the

    companys profit by certain extent.

    The coordination between the each departments in the organization are committed to

    overall growth of the organization and employees are sincere and contributing to the

    success of organization.

    Infrastructure of the company is congested it act as disturbance on the movement of

    materials in the organization.

    The RSPL having the good relationship with the customers of the organization it will

    lead to attract and effectively mobilizing sales in the long term.

    The RSPL having good quality of products in the market and it will helps to stimulate

    the customers and improve sales.

    Employees in the organization are trained and are always trying to contribute to thedevelopment of the company.

    The companys distribution channel is efficient and always meets the demand of the

    materials to various departments in time.

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    SUGGESTIONS

    Improve the technology for the sake of growth in production.

    The pooling in of money to the capital investment should be basically done by the

    investors rather than depending on banks.

    The operating costs can be reduced to certain extent by introducing new methods of

    production and upgrading the employee skills in the process of production and

    effective control of all valuable assets of the organization.

    The machines used in the Rayen Steels Pvt Ltd are became obsolete, hence they have

    to be replaced with new machinery for improved production this ultimately bring

    value addition to the company.

    There is lack of infrastructure limits and material handling facilities, hence expanding

    infrastructure could be a viable opinion.

    Training program is necessary for all the workers to improve quality of production.

    RAYEN should try to enter all the regions of India as its new market place.

    They should provide the safety equipments for the workers to ensure better safety.

    They have to implement the Management Information System (MIS) for the benefit of

    organization. (Such as intranet and website).

    Introduce innovative methods for improving production.

    Improve product quality than the competitors.

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    CONCLUSION

    The training is one of the most important programmes of a professional course. The trainee

    feels very proud of this opportunity, which was provided to him. This opportunity gives him

    the practical knowledge for the application of theory.

    The internship project in the RAYEN STEELS gave me an opportunity to experience and

    evaluates my learning, which I had learnt in the classroom.

    It gave me a chance to know about the different departments within it. It was a wonderful

    experience to interact with the people from various departments, which are definitely going to

    help me a lot in my upcoming future.

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    BIBILIOGRAPHY

    A. Booksa. Dr. K. Ashwathappa, Production Operation Management, Himalaya Publishing

    House, First Edition: 2008

    b. P. Subba Rao, Human Resource Management, Himalaya Publishing House, First

    Edition: 2008

    B. WEBSITE

    www.steelscenario.com

    www.spongeironindialtd.com

    C. News paper

    Business Times, Business World

    D. Report

    Company Annual Report