Kirloskar ferrous industries LTD

Chapter-1

INTRODUCTION ABOUT THE INTERNSHIP

Introduction about the internship

Internship refers to the opportunities provide for the students to develop their academic knowledge.
Students learn a lot of things from internship which cannot be actually thought in classroom. The
practical knowledge gained by the students will help them to improve their skills, talents and gain
various experiences. It was duration of 4 weeks working with KIRLOSKAR FERROUS
INDUSTRIES LIMITED to know about their policies, vision, mission, organization structure, future
growth and prospectus, an overview of all the departments in the organization, SWOT analysis, and
way of working, culture of the organization, product development or service provided.

This is an advantage for students to work under superiors and to know their strategies, duties and
responsibilities towards working condition. Internship also helps to explore and engage in the
company and experience with insights. Internship helps the students for their placement programs as
they are already trained with practical work so it will be easy to find a job.

Objectives of the study

1. To give familiarize with the business organization.

2. To gain familiarize with the different departments in the organization and their functioning.

3. To understand how the key business processes are carried out in organizations.

4. Understand how information is used in organization for decision making at various levels.

5. To relate theory with practice.

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INDUSTRY PROFILE

The steel industry is experiencing one of the longest upswings periods for many years. Since the
beginning of 1987, steel production is riding for almost 29 months’ with 1988 bringing an increase
of western world output to 488 million metric tons of crude steel or Seymour than users also
becoming all the economic growth and country builds stadium for the 2008 Olympics in Beijing.

These favourable prospects raise hopes that steel makers are into a period of greater stability. It
would seem as if the painful economic adjustment process, which has been lasting for many years, is
nearing completion, and that the adoption of steel capacities, technologies and management attitudes
to the changed patterns of economics growth Tata are finally starting to bear fruit.

Government policy and the International Monetary System with pegged but adjustable rates and U.S
dollar as a reserve currency has favoured this rapid growth. This period is commonly called the
“post- war reconstruction period”. The intensity of steel’s economic growth was raising by vast rate
between1950-60.

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In Western Europe, steel jumped by 30%, in japan by 58% and in Brazil by 41%. The effect of steel
consumption increased by an average of 5.2% in the year 1950 1960.the industrialized countries
expanded their steel use by 4.8% per annum. The developing nations did so by much as 8.9%.

Between 1960 and 1970, Western World steel consumption grew by 5.7% a year, with the
industrialized countries expanding their steel usage by 5.6% a year and the developing countries buy
as much as 6.5% a year.

The steel industry has harvested to the bitter of this excessive optimism in the firm of overextended
capacities throughout the world. Like this KFIL steel is not without lots of company in that regard.

Another important influence on steel intensity is the replacement of steel by other materials.
Calculating that portion of the reduction in the specific consumption of the steel that is due to use of
other materials is extremely difficult.

However, estimates made by the international iron and steel institute would seem to indicate that for
all of the western industrialised countries the rate of substitution of materials such as plastics,
aluminium, glass and timber for steel is presently standing at between 2 and 5 percent of steel
consumption.

Earlier to the government liberalization and de-licensing policies in 1991–92, there were mainly two
pig iron producers in Indian market; the two pig iron producers were TISCO and SAIL. They used to
produce basic grade pig iron which contains less silicon content conversion to foundry grade pig
iron. So when this is used by the foundries they have and Ferro silicon for the conversion to foundry
grade also the available quality of pig iron to the foundries was very much limited because only of
ISCO and SAIL were looking after all the foundries in India.

After the liberalization and de-licensing policies of government and private sectors showed keen
interest in the pig iron manufacturing units that to in the production of foundry grade pig iron, TATA
group in collaboration with Korf Brazil started supplying mini blast furnace of 250 cubic meters.
When blast furnaces were available, many private sectors started. Producing pig iron among them
Sese, Goa and Usha ispat, Sisco (Southern Iron and Steel Co. Ltd). Uni Metal, Meco, Lanco,
Sathavana, Kirloskar are main. These all pig iron producers started producing mainly foundry grade
pig iron.

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Origin of the industry

The origin of the modern Indian Steel Industry can be traced back to 1953 when contract for the
construction of an integrated steel works in Rourkela, Orissa was signed between the India
government and the German companies Fried Krupp & Demag. The initial plan was an annual
capacity of 5,00,000 tones, but this was subsequently raised to million tonnes.

At a very early stage the former USSR and British consortium also showed an interest in establishing
a modern steel industry in India. This resulted in soviet-aided building of a steel mill with a capacity
of 1 million tons in Bhilai and the British backedconstructi-c11 in Durgapur of a foundry which also
has a million tonnes capacity.

Global scenario of pig iron

The demand for international has a sharp raise, the total production of pig iron. Pig Iron is an
intermediary product of smelting iron ore with coke. It has high carbon content ranging from 3.5% to
4.5%. Which makes it very brittle and not useful directly as a material except for limited
applications. The original shape of the moulds used for these ingots.

The pigs was in the form of branches formed in sand, with many individual ingots at right angles to a
central channel. When the metal had cooled and hardened, the smaller ingots.

The pigs were simply broken from the much thinner runner (the sow), hence the name pig iron. As
pig iron intended for remoulding, the uneven size of the ingots and inclusion of small amounts of
sand was insignificant compared to the ease of casting and of handling.

Present scenario
India is gifted with large quantity with high ferrous contact, which is crucial raw material for
producing the steel. Hence India is largest procedure of the steel in the world. With the help of
liberalization, globalization of economy in the process, there is as scope for economic development,
which means there will be focus on infrastructure this will lead to considerable demand for steel. As
its main application are in the construction Engineering and automobile sector, which are the key
element in building infrastructure. Steel is universe intermediate and has very strong forward linking
hence steel industry has become one of the core sector of the economy.

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Through India one of the largest steel procedure, it has low per capita consumption of steel in
comparison with other developing and developed countries. As demand for steel is on the rise we can
expect good rise in the consumption.

India is fortunate in having intensive iron ore deposits with estimated at 10.3 Billion which is more
than 1/4th of the world reserves. Further the iron ore content of India is above 60%. In India the iron
ore reserves are mainly found in the states like Orissa, Karnataka, Bihar, M.P, Goa, A.P, Rajasthan
and some parts of Western Maharashtra. When we think of steel industry, the first thing that comes
on to our mind is pig iron.

GROWTH OF PIG IRON IN INDIA

Before liberalization the pig iron industry was monopolized by the integral steel plants to utilize the
liberalization policy initiated by the Government. Decline in the pig iron production and paved the
way of helping the ISP’s be utilize pig iron for making steel to gain value addition.

The integrated steel plant (ISP) is the major supplier of pig iron. Public sector contributes up to 90%
of the Pig Iron supply. According to the Steel Ministry Report, demand for pig iron is estimated to
increase by 37% over next 8 years.

Steel – a versatile commodity, most widely used metal in the world, forms a core constituent of all
major economies. . Accordingly, Steel Consumption is a derivative of the growth pattern of its
various end-use sectors viz. manufacturing, housing, infrastructure, automobile etc. that ultimately
steer the country’s economy.

Production and prices were determined and regulated by GOI. The steel sector was deregulated in
1991-92, when controls on capacity and prices were abolished along with quantitative trade
restrictions. Import tariffs were also brought down substantially. In 2000-01, the Indian steel industry
operated at finished steel production level of 26.7 million tones with apparent finished steel
consumption at 26.9 million tones. . However, with the onset of liberalization, the Indian steel sector
witnessed entry of several domestic private players and large private investments flowed into the
sector to add fresh capacities.
In 2004-05, the indigenous production of steel was38.4 million tones along with apparent finished
steel consumption at 33.4 million tones, in the year 2008-09 demand of the steel will decrease due to
the recession.

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Today, India produces steel of international standards conforming to almost all grades and varieties
and has been a net exporter for the past few years, which shows the growing acceptability of its
products in the global market, and most importantly it’s increasing global competitiveness.

India continually posts phenomenal growth records in steel production. In 1992, India produced
14.33 million tons of finished carbon steels and 1.59 million tons of pig iron. Furthermore, the steel
production capacity of the country has increased rapidly since 1991 - in 2008, India produced nearly
46.575 million tons of finished steels and 4.393 million tons of pig iron. Both primary and secondary
producers contributed their share to this phenomenal development, while these increases have
pushed up the demand for finished steel at a very stable rate. In 1992, the total consumption of
finished steel was 14.84 million tons. In 2008, the total amount of domestic steel consumption was
43.925 million tons. With the increased demand in the national market, a huge part of the
international market is also served by this industry. The steel industry is believed to have been
operating at around 90 per cent capacity utilization factor in 2004. As per International Iron and Steel
Institute estimates, global steel demand has increased by around 8.8 per cent. The Indian steel
industry is almost 100 years old now. Till 1990, the Indian steel industry operated under a regulated
environment with insulated markets and large-scale capacities reserved for the public sector.

The steel sector was deregulated in 1991-92, when controls on capacity and prices were abolished
along with quantitative trade restrictions. Import tariffs were also brought down substantially. In
2000-01, the Indian steel industry operated at finished steel production level of 26.7 million tons
with apparent finished steel consumption at 26.9 million tons.

However, with the onset of liberalization, the Indian steel sector witnessed entry of several domestic
private players and large private investments flowed into the sector to add fresh capacities. In 2004-
05, the indigenous production of steel was38.4 million tons along with apparent finished steel
consumption at 33.4 million tons, in the year 2008-09 demand of the steel will decrease due to the
recession.

Today, India produces steel of international standards conforming to almost all grades and varieties
and has been a net exporter for the past few years, which shows the growing acceptability of its
products in the global market, and most importantly it’s increasing global competitiveness. Steel
production in India has increased by a compounded annual growth rate (CAGR) of 8 percent over the
period 2002-03 to 2006-07. Going forward, growth in India is projected to be higher than the world
average, as the per capita consumption of steel in India, at around 46 kg, is well below the world
average (150 kg) and that of developed countries (400 kg). Indian demand is projected to rise to 200

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million tons by 2015. Given the strong demand scenario, most global steel players are into a massive
capacity expansion mode, either through Brownfield or Greenfield route. By 2012, the steel
production capacity in India is expected to touch 124 million tons and 275 million tons by 2020

World Steel Industry

Steel, the recycled material is one of the top products I the manufacturing sector of the world. The
Asian countries have their respective dominance in the production of the steel all over the world.
India being one of the fastest growing economies of the world has been considered as one of the
potential global steel hub internationally. Over the years. Particularly after the adoption of the
liberalization policy all over the world, the world steel industry is growing very fast.

Structure of the Indian steel industry

The Indian steel industry can be divided into two distinct producer groups:

 Major Producers: Integrated Steel Producers (ISPs) includes large steel producers with high
levels of backward integration and capacities of over 1 MT. Steel Authority of India Limited
(SAIL), Tata Steel, Rashtriya Ispat Nigam Limited (RINL), JSW Steel Limited (JSWSL),
Essar Steel Limited (Essar) and Ispat Industries Limited (Ispat) form this group. SAIL,
TISCO and RINL produce steel using the blast furnace/basic oxygen furnace (BF/BOF) route
that uses iron ore, coal/coke as the basic input mix for producing finished steel, Essar and
Ispat employ Electric Arc Furnace (EAF) route that uses sponge iron, melting scrap or a mix
of both as input and JSWSL uses COREXSS, a revolutionary technology for making steel
using basically iron-ore and coal.

 Other Producers: This group consists of smaller stand-alone steel plants

That Include producers and processors of steel.

Processors/Enrollers: Units producing small quantities of steel (flat/long

Products) from materials procured from the market or through their own

Backward integration system.

 Stand-alone units making pig iron and sponge iron.

 Small producers using scrap-sponge iron-pig iron combination produce steel ingots (for long
products) using Electric Arc Furnace (EAF) or Induction Arc Furnace (IAF) route.

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The steel industry, in general, is on the upswing, due to strong growth in demand propelled
particularly by the demand for steel in China. The world scenario coupled with strong domestic
demand has benefited the Indian steel Industry.

Role of Iron and Steel Industry in India GDP-Consumption:-

India accounts for around 5 per cent of the global steel consumption. Almost 70% of the total steel
used is for kitchenware. However, its use in railway coaches, wagons, airports, hotels and retail
stores is growing immensely India's steel consumption rose by 6.8 per cent during April-November
2009 over the same period a year ago on account of improved demand from sectors like automobile
and consumer durables. A Credit Suisse Group study states that India's steel consumption will
continue to grow by 16 per cent annually till 2012, fuelled by demand for construction projects worth
US$ 1 trillion.

Consumption:-
 The domestic consumption of steel has grown by12.5% in the past three years.
 The average growth rate of the Indian Iron and Steel Industry is 11.36%.
 The construction projects all over India are major consumer of steel.
 The per capita consumption of steel in India is 35 kg – compared to 150 kg across the world.

Role of Iron and Steel Industry in India GDP-Growth in Future:-

 The Arcelor Mittal, which is the largest steelmaker in the world, has plans of establishing two
Greenfield steel projects with capacity of 12 million tons annually, in India.
 The Tata Steel rank is 5th in the world steel production and the company have plans of
expanding its capacity by the year 2015.
 SAIL, India's biggest producer of steel has plans of increasing the production to 24.98 million
tons annually.
 The National Steel Policy has a target for taking steel production up to 110 MT by 2019–20.
 The Ministry of Steel has projected India's steel capacity is expected to touch 124.06 MT by
2013–14. India's steel capacity is likely to be.

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Chapter-2
ORGANIZATION PROFILE

Kirloskar Ferrous Industries Limited (KFIL) is the youngest company in the Kirloskar group. The
company is the large-scale industry to begin operations in the rural & industrially backward district
of Koppal. 1991 KFIL was incorporated. It began manufacturing Foundry Grad Pig Iron in April
1994 and Automotive Castings in April 1995.The company’s Pig Iron & Casting are well known for
their quality throughout the country. Company is for manufacture & selling of pig iron in India. The
manufacturing facilities at the company are of world standard & the market for its automotive
castings is growing steadily.

The company is located on the banks of Tungabhadra reservoir, near to the rich iron belt of the
Hospet – Bellary range, adjacent to NH –63 connecting Hospet-Hubli passing through Koppal &
Gadag. The plant is 16k.m. from Hospet & Koppal. NH-13 is connecting Chitradurga & Sholapur
passes by the side of the plant. The nearest railway station is Ginigera, which is 5.0 Km away from
the plant.
KFIL operates at two locations. One at Bevinahalli in Koppal District near Hospet, on the banks of
the Tungabhadra reservoir in Karnataka, which is near to the rich iron ore belt. Another one at

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Solapur in Maharashtra came into the fold of KFIL on 1st January, 2007. The industry was born with
unique advantage of having behind the immense accumulated experience of the group in the field of
foundry business, at a time when the de-licensing and liberalization policies of the government were
resulting in rapid growth in automotive and farm mechanization. The plant has two mini blast
furnaces of 350MT capacity each, capable of producing 120,000MT/year. This amounts to a total
installed capacity of 240,000MT/year (Pig iron). Castings 112,000 MT.
The company has engaged 1,200+ (Hospet plant& Solapur plant) direct employees and they take
contract base workers. A sales turnover of Rs.6, 991.39 million per annum. The company is
committed to achieve total consumer satisfaction through adoption state-of-the-art manufacturing
technologies & 7 processes with continue improvements. The company is also committed to improve
quality of work life of its employees through improved work practices. The company is responsible
for the coming up of many ancillaries present, there are around 20 ancillary units spreads over
Koppal. Iron ore is brought from the mine owners in the calibrated from Hospet & Bellary Iron ore
belt within the distance of 50 kms. Coke is mostly imported from China. Other minerals like
Limestone, Dolomite, Manganese ore, Quartz etc., are produced locally. Almost all foundries and pig
iron users in the country are purchaser of pig iron from the company supplies quality castings to all
renowned automobile manufacturers like Mahindra & Mahindra, Maruti Udyog, Escorts, Tafe and
Simpson to name few.

Background and inception of the Company:

The Kirloskar group origins were small but significant. In the year 1903, Sri.Laxmanrao Kashinath
Kirloskar opened a bicycle shop in the state Karnataka in south India. From this modest venture has
grown the Kirloskar group of more than 15 manufacturing company with an annual turnover
exceeding 116 million pounds string and engineering field in India. A Kirloskar product includes
pumps, farm machineries, machine tools, diesel engines, electrical machinery a wide variety forgings
electric switch gears and tractors. The vast Kirloskar group is the result of industrial Vision of
Shri.L.K.Kirloskar, many overseas factories are Located in the West Germany, Philippines, Malaysia
and Kenya. The vast Kirloskar group’s total worldwide export achievement currently these includes
centrifugal pumps to UK machine tools to USA, Canada, West Europe diesel engines to UK,
transformer and pump -sets to Malaysia.

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K-groups
The vision of one man, Shri Laxmanrao Kashinath Kirloskar, which is today the “Kirloskar Groups”,
respected worldwide for engineering excellence, can trace its beginning to the first casting of a
humble plough.

Kirloskar is 600 Million US Dollar engineering conglomerate driving critical industries. K-group is a
century old pioneers in the areas of specification like power construction and mining, agriculture,
industry and transport, oil and gas and environment protection with a range of world-class industrial
products and turnkey services

KFIL made up of 8 major group companies, who players in major sectors like manufacturing, oil and
gas, power, construction and mining, agriculture, industry and transport each led by the engineering
and managerial talent in India. In addition to engineering, they are multi-unit, multi-product; multi-
location conglomerate is built on the plinths of Experience, Expertise, Quality, Innovation and
Values in the business.

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These 8 companies are from the core of Kirloskar group. Each company is a renowned name in its
own area of operation and is respected worldwide for its services and products.

Companies with
majority holding

Public listed Holding Companies with

companies under company minority holding
group

Kirloskar Brothers Ltd Kirloskar Ebara Pumps Ltd. Kirloskar Toyota Textile
Machinery
Kirloskar Oil Engines Ltd Kirloskar Chillers Pvt.Ltd.
Toyota Kirloskar Motor
Kirloskar Pneumatic co Aban Construction Pvt.Ltd.
Ltd Denso Kirloskar
Kirloskar Corrocoat Pvt.Ltd.
Kirloskar Ferrous Toyota Gosei Kirloskar
Kirloskar Proprietor Ltd.
Industries Ltd Steel Logistic Centre
SPP Pumps –UK
Toyota Kirloskar Auto
Kirloskar Middle East FZE
Parts

 Kirloskar Brother Limited (KBL Established in 1888) incorporated in 1920 is the

acknowledge leader in largest manufacturing and exporter of pumps in India.

 Kirloskar Ferrous Industries Limited (KFIL)1991

 Kirloskar Middle East FZE (KMEF)1997

 Kirloskar oil Engines Limited (KOEL) incorporated in 1946

 Kirloskar Pneumatic Limited (KPCL)1958

 Kirloskar Proprietary Limited (KPL)1965

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 Kirloskar Copeland Limited (KCL)

 Kirloskar Ebara Pumps Limited (KEPL)

Kirloskar has shaping capable managers at Kirloskar Institute of Advanced Management Studies
(KIMS). It is Kirloskar education centre for imparting knowledge to the managers of tomorrow.

The Kirloskar story

It has now been more than a century since the Kirloskar story started. We started with an aim of
becoming the pioneers in fields in which our country needed innovation. In the 100 years and more
that we have been in existence as a family and as an organization, they have been seminal to Indian
agricultural and industrial development. They gave India its first iron plough, pump and engine;
inventions that were born from the need of the hour and went on to become signs of the time. That is
why our group history can in many ways be considered a history of the economic and industrial
revolution in India. All though the passing years the Kirloskar group has had a long & close
relationship with the foundry business with several group units specializing in the manufacture of
high quality ferrous & non-ferrous casting. While Laxmanrao Kirloskar established the group, his
son S. L. Kirloskar played a major role in its rapid growth. S.L.Kirloskar transformed his vision into
a promising and thinking reality, of application of appropriate technology, customer satisfaction and
dauntless integrity. SLK was a global thinker who had the courage and the confidence in his own
country even in the pre-independence era. He often said, "Economic preparedness (Awareness) is as
vital as military preparedness." He always looked at India as a part of the rest of the world and
struggled to make India globally competitive - that was his spirit of patriotism (Nationalism).

Kirloskar Ferrous Industries Limited was born with the unique advantage of having been conceived
with ideas accumulated through experience & expertise of the group in the field of foundry business,
at a time when the de-licensing and liberalization policies of the government came forth in the year
1992 resulting in the rapid growth in automotive and farm mechanization sectors. The making of the
electrical motor. This was the second of Laxmanrao Kirloskar's long cherished dreams, the first
being the making of an engine. This task was brought to completion by Ravi Kirloskar, his youngest
son, in 1946.

KFIL’s state-of-the –art foundry was the answer to the high volume demands of these sectors which
require thin walled castings with very small machining allowance and above all accurate dimensional
accuracies absolutely essential for matching on sophisticated machining centers in a single pass.

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KFIL, the only foundry in Asia with backward integration to liquid metal, has global capacities to
meet high volumes at consistent quality.

The founder of the company

The Kirloskar story starts with Laxmanrao Kirloskar, the founder. A man who believed that an
understanding of one's environment and reality was essential to the manufacture of path-breaking
industrial implements. From this steadfast belief was born the iron plough, the first Kirloskar
product. Originally intended as an essential aid to agriculture, the plough soon became an icon of
reform and revolution. A highlight of the early history of the group is Kirloskarvadi, India's first
industrial township. A model factory-village created by Laxmanrao and his band of dedicated
workers.

LAXMANRAO KIRLOSKAR

The founder of the Kirloskar Company

Kirloskar Ferrous Industries Limited (KFIL) Bevinahalli.

Kirloskar Ferrous Industries Limited Co. was incorporated on 10th September 1991 as a Public
Limited. Kirloskar Oil Engines Ltd. and Shivaji Works Ltd promotes the company. The main
objective of the company is to manufacture Pig Iron and ferrous casting. The company commenced
production in 1994 and up an additional blast furnace in 1995.

Kirloskar Ferrous Industries Limited is located at Bevinahalli of Koppal district. It is spread over 300
acres of spacious land with lush greenery around. Kirloskar Ferrous Industry Limited has 2 mini
blast furnaces each of 250 M3 working volume, technology and design of TATA-KORF limited in
technical collaboration with Kopf technology Brazil for extracting pure iron.

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Each furnace producing 1,80,000 tonnes of Pig Iron metal/year. The plant manufactures foundry
grade Pig Iron suitable for automobile castings. Raw materials are brought from Sandur and
Donimalai sector near Hospet, abundance of rich iron deposits are available in the areas. Fluxes such
as limestone, dolomite, quartzite and manganese are available in the nearby surrounding area. Both
iron ore and fluxes are easily accessible by road. Coke is imported from China / Japan which is
unloaded at GAO/Chennai/Mumbai port and brought to the work site by rail or road. Coke is biggest
raw material to the company and it accounts for almost 80% of raw material costs. Kirloskar Ferrous
Industries Limited is the first pig iron manufacturer in India with QS 9000 certification.

NATURE OF BUSINESS
The company manufactures the Pig Iron in three different grades, by Calibrated Iron-ore brought
from mine owners in the Hospet & Bellary Iron-ore belt within the distance of 50 kms and grey iron
castings.

The business at KFIL divided into two divisions, one is the Pig iron manufacturing unit (called as
“Pig iron SBU” – Strategic Business Unit) and the other is Foundry unit (called as Foundry SBU.

VISION, MISSION AND QUALITY POLICY.

 VISION
“To be a product leader in Pig Iron & Casting Business and a preferred business partner to all stake
holder”

 MISSION
 PIG IRON
 To be a lower cost producer of pig iron
 To be a preferred supplier for quality and delivery
 Introduce Value added product
 To achieve 425,000 MT of liquid metals
 CASTINGS
 To be a preferred supplier for domestic & global OEMs
 Meet customers expectation in new product development cycle time
 Meet customer expected level of quality
 100% delivery performance

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 QUALITY POLICY & OBJECTIVES

QUALITY POLICY:

KFIL is committed to achieve Total Customer Satisfaction through adoption of state – of – the – art
manufacturing technologies and processes with continuous improvements. KFIL is also committed
to improve Quality of work life of its employees through improved work practice

QUALITY OBJECTIVES:

 CUSTOMER SATISFACTION: Maximization of Customer Satisfaction by consistent supply

of Quality Casting & Pig Iron.
 SUPPLIER QUALITY ASSURANCE: Provide technical support and guidance to our
suppliers through Quality Assurance Programmes to ensure highest Quality of purchased
materials. Supplier is a critical link in our Quality System.
 EMPLOYEE DEVELOPMENT: Development and motivation of all employees by providing
necessary training and support to bring out their full potential.
 PRODUCT EXCELLENCE: Continuously striving for Product Excellence through adherence
to documented work practices, technical and managerial innovation and continuous
improvements. Our endeavor is to push ourselves till our processes and products are finest in the
country and compare with the best in the world.

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Products profile:
The following are the three different grades of pig Iron manufacturing by the company. They are:
1) Foundry grade pig Iron
2) Spherical Graphite grade
3) Basic grade
KFIL products are in the beginning of the value chain. The major thrust is to “Drive down Cost”
to retain competitive edge
 Quality
 Cost
 Productivity
 Process
 Products
PIG IRON
Pig iron is the basic input for making iron casting which finds its application in steel industry & other
sectors of the economy. It can also be used in the change mix of the electrical are furnaces (EAFs) as
a partial substitute of melting scrap. Pig iron mainly classified into tow glades.
 Basic glade (which is used for making steel)
 Foundry glade (which is used of manufacturing casting)
E.g. Glade which is used of manufacturing special steel India’s share in the total global exports is
4.51% in 1996-97 & the same increased to 7.14% in 1997-98.Global scenario of pig iron. The
demand for pig iron in the international arena has seen sharp rise. The total production of pig iron to
500 M.T. developed nations accounts for 45% of the total production. Seeing the potential demand
many mills in USA such as NUCOR. NORTH STAR CASCADE STEEL & MAC STEEL is
switching over to pig iron production

Casting of Pig Iron:

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George Fischer makes high pressure moulding machine and auto

mould handling system.

 Type of moldings machine: Air Impact Plus

 Speed: 70 molds per hour
 Box Size: 1250 X 900 X 400 / 400 mm.
 Core setting mechanisms: 2 nos.
 Sand Plant with capacity of 110 tons per hour with mold ability controller

Certifications

 ISO 14001:2004 Koppal

 ISO-TS 16949:2009 Koppal

Power Generation:

Turbine Generations: 2 nos.

Capacity Power Plant with capacity: 19 MW.

FOUNDRY PLANT

Melting

ABB Make Holding / Melting Furnaces: 3 Crucibles and 2 control

Capacity: 30 tons holding capacity each.
ABB make press pour Furnace with 7 tons holding capacity

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Mould shop

George Fischer makes high pressure moulding machine and auto mould handling system.
Type of mouldings machine: Air Impact plus Speed – 70 mould per hour
Box Size: 1250 X 900 X 400 / 400 MM.
Core setting mechanisms : 2 nos.
Sand Plant with capacity of 110 tons per hour with mould ability controller.
Equipped to produce 60,000 tons per year of Grey Iron Castings.

Commercial production – March 1995.

The only Foundry in Asia with a backward integration of Pig Iron.

Power

A captive generation using Blast Furnace gas capacity 7.0 MW

Turbo Generator – I Commercial Production – Aug 1994
Turbo Generator – II Commercial Production – Nov 1997

Core Shop

Cold Shooter capacity: 40 liters

Number of core shooters: 20 nos.
Shell Core Shooters Capacity: 40 liters, 20 liters and 15 liters
Number of core shooters: 10 nos.

Casting Cleaning

George Fischer designed Special Purpose Shot Blast machine Hanger type shot blast machine.

Quality

ARL Spectrometer
Chemical laboratory
Sand laboratory
Brinnel Hardness Tester
Universal testing machine
Casting sectioning machine
Microscope with photo and CCTV attachment.

Other Quality parameters

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Wall Thickness: 3.5 MM (minimum).

Machining allowance: As per requirement – Tolerance +/- 0.50 MM.
Surface finish : Between SN – 9, 25 – S & SN – 9, 35 – S of JIS : JIS B 0659.
Weight variation: +/- 2.0% of specified weight.
Microstructure: Uniform, fine, densely striated parasitic structure with Type “A” Graphite up to
98% and ferrite 2%.

USAGE OF THE PRODUCT IN DIFFERENT INDUSTRIES.

The following chart represents the basic of products differentiation and the list of industries where
these products are used
PARTICULARS PERCENT
TEXTILES 12%
PUMPS 11%
AUTOMOBILE 26%
PIPES 12%
ENGINES 6%
FANS 3%
AGRICULTURE 10%
OTHERS 20%

12% textiles
11% pumps
20%
10% automobile
26%
3% 12% pipes
6% engines
fans

Source: Company records

The above table represents the basic of products differentiation and the list of industries where these
products used. Chemical composition of the product is the reasons for production for different kinds
of products. Mainly products are differentiated on the basis of silicon compensation. Company has
got different kinds of customer varying between with high or low range of silicon contents. “Keeping
the wheels of progress turning in every way always that is, how we operate”

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AREA OF OPERATION:

The area of operation of the company is global; it has its branches in other countries also. Namely:

GLOBAL:

 Indo- Malaysia Engineering Co., Malaysia

 Kirloskar Industries, Philippines
 Kirloskar Kenya Ltd., Kenya

NATIONAL: KFIL Main office address:

REGISTERED OFFICE

Laxman Rao kirloskar Road

Khadki – Pune 411003 (INDIA)

The main production unit of the company is situated in Bevinahalli (koppal District), which is
surrounded by the rich resources, in terms of raw material, water, human resources & a
transportation facility. The exact address is as follows,

REGIONAL:

KFIL ADDRESS:

Village : Bevinahalli
Post : Hitnal (PIN583234)
Dist : koppal
State : Karnataka

ZONAL LEVEL

Zone A Karnataka Belgaum, Shimoga, Bangalore

Zone B Andhra Pradesh Hyderabad, Vijayawada

Zone C Maharashtra Kolhapur, Pune, Mumbai, Nagpur, Sholapur

Zone D Gujarat Ahmadabad, Rajkot, Surat

Zone E Rajasthan Jaipur

Zone F Delhi Delhi, Faridabad, Zodhinoor, Agra

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COMPETITORS INFORMATION

As the company has got two kinds of products the competitors of the company are broadly divided
according to their type of procurement. They are as follows

PIG IRON COMPETIORS FOUNDRY COMPTITORS

1.Sesa Goa Industries Ltd. 1. Ashok Iron Works Private. Ltd.

2.Kudharemukha Iron & Ore. 2.DGP Foundry

3.Kalyani Steels Ltd. 3.Nelcast

4.JSW 4.Hinduja Foundries

5.USHA Steels Ltd.

6. Tata Metallic’s.

INFRASTRUCTURAL FACILITY

 Power: KFIL has the following facilities for getting the required amount of power.
State electricity boards
Two steam turbines/ Generators or capacity 3.5 mw each using blast furnaces gas as fuel. Kirloskar power
supply Pvt. Ltd is established adjacent to KFIL and has the total installed capacity 19.5mw.

 Water: Major requirements of water are being pumped from nearly Tungabhadra
Reservoir by laying a pipeline for almost 7km.
 Transportation: There are 8 buses to pick and drop middle level management
employees.
 Medical Centre: Medical Centre is built to cater the medical need of the employees.
 Canteen: The KFIL has a good canteen facility.
 Furniture: In KFIL every department well equipped furniture & computers.

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Ownership Pattern:
Shareholding Pattern as on 31st March, 2015:-

Category Number Percentage of

of Shares Shareholding

Promoter Companies 80,467,620 58.61

Financial Institutions 3,565,000 2.60

Nationalized Banks 600 0.00

Non Nationalized Banks NIL NIL

Non Resident Indians 1,485,743 1.08

Mutual Funds 4,573,266 3.33

Foreign Institutional Investor 81,100 0.06

Domestic Companies 8,174,095 5.95

General Public 38,947,055 28.37

Total 137,294,479 100.00

Achievement/Award:

 Awards Mile stones of KFIL

 ISO - 14001 Certificate
 ISO - 9001 Certificate
 OHSAS - 18001 Certificates. (Occupational Health and Safety Assessment Series) by
Indian Register Quality System
 TS - 16949 Certificate
 National energy conservation award in 2007
 National energy conservation award in 2009
 CII – Exim Bank award for business excellence 2015
 CII – Exim Bank award for business excellence 2016

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 Achievements
 KFIL is the first among few in India to adopt state of technology with CNC controller
machines consistent quality of Pig Iron
 KFIL also records the project completion of MBF 1st within 18 months and 2nd MBF
in 9 months
 Capacity utilization of two furnaces has increasing 107%92000-2001)
 Reproduction in power consumption per ton of costing production.

Future growth and prospects:

The steel industry, the automotive sector and tractor industry have direct impact on the business of the
Company. Despite the slowdown in the general economy, the above sectors are expected to perform better.
This will help in having a sustained demand both for pig iron and castings.
In order to become cost competitive, the Company has identified the following projects for cost
saving:

Installation of sinter plant to utilize the iron ore fines, coke fines & Fluxes fines to convert the same
into sinters to be used as raw material in the manufacture of Liquid Metal, which will result in
reduction in operating costs and increase in productivity;
Installation of 4.5 MW Power plant to utilize excess Blast Furnace Gas is in progress
Establishing Clean Development Mechanism (CDM) for projects like Power Plant III and Hot Blast
Stoves - II.

Installation of Coke Oven plant to utilize the Coke fine to convert the same into the furnace which
will result in reduction in export of Coke.

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CHAPTER-3

MCKENSY’S 7-S FRAME WORK

INTRODUCTION:

Japanese first introduced this model. The 7-S model is better known as Mckensy’s 7-S. This is
because the two persons who developed this model. Tom peters and Robert Waterman, have been
consultants at Mc Kinsey and company at that time. They published their 7-S model in their article
“Structure is not organization” (1980) and in their books “The art of Japan management” (1981) and
‘in search of excellent (1982)’.

Mckensy’s 7-s frame work chart:-

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1. STRUCTURE:
It is the part for specialization and co-ordination. It comprises of the basis organization of the
company, its departments, reporting lines areas of expertise, and responsibility (and how they inter-
relate), and the way in which the parts of a thing are arranged or organized.

Finance departments will acts as major part of every industry. It is the basic necessity to run each
and every single activity of organization. The finances department is treated as the one of the most
significant departments.

a) Overall organization structural –Board of Directors/ Functional heads etc.

b) Sub structure detailing with each functional discipline. Detailed study of various
departments& their functions.

BOARD OF DIRECTORS

1. MR. Atul kirloskar - (Executive chairman)

2. MR. Rahul C. Kirloskar - (Vice chairman)
3. MR. R.V Gumaste - (Managing Director)
4. MR. A.R Jamenis - (Indipendent Non Executive Director)
5. MR. A.N Alvani - (Non Indipendent Executive Director)
6. MR. B.S Govind – (Indipendent Non Executive Director)
7. MR. R. Sampath Kumar - (Indipendent Non Executive Director)
8. Mrs. Nalini Venkatesh - (Indipendent Non Executive Director)
9. MR. Y.S Bhave – (Additional Director)

The main term of the Organization structure is comprehend all the possible Dimensions of the
organization structure as in developing the ability to focus on these dimensions which are currently
important to the organizations evaluations- and to be ready to refocus as a crucial dimensions shift.

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STRATEGIES

 Maintaining quality leadership

 On – Time delivery
 Strong dealership network
 Customer orientation
 Customer driven
 Performance tracking of competitors
 ARL Spectrometer
 Chemical laboratory
 Sand laboratory
 Brinnel Hardness Tester
 Universal tasting machine
 Casting sectioning machine
 Microscope with photo and CCTV attachment.

PROMOTION

KFIL has appointed numbers of dealers throughout India for its marketing purpose each dealer will
get rs100/- PMT as commission for the pig iron he sells credit notes are given to these dealers for his
commission. Pig iron is also give credit sales as one of the promotion tools to attract customer credit
time depends on areas (less credit period is for north zone) & order they give.

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DISTRIBUTION

KFIL has got distribution network spread all over India inform of dealer ships & also through
company’s employee KFIL has divided its market into 7 zones.

Zone A Karnataka(KA) Belgaum, Shimoga, Bangalore.

Zone B Andra Pradesh(AP) Hyderabad, Vijayvada

Zone C Maharashtra(MH) Pune, Mumbai, Nagpur, Solapur

Zone D Gujarat(GU) Ahmadabad, Rajkot,Surat

Zone E Rajasthan(RJ) Jaipur

Zone F Delhi(DE) Delhi,Zadhinoor,Agra

Zone G Tamil nadu (TN) Chennai, Coimbatore, Madurai.

2. STRATEGY:

Strategy refers to the systematic action and allocation of resources to achieve the companies aim.
The integrated vision and direction of the company as well as the manner, in which it drives,
articulate, communicates and implements that vision and direction. It can also be defined as the
choice of direction and action that the company adopts to achieve its objectives in a competitive
situation.

The Strategies adopted by KFIL to achieve low cost along with maintaining the qualities are as
follows:

 By Reducing the coke consumption up to 40%

 By generating small amount of power through the power units within the company.
 The sand which is generated as waste after manufacture of pig iron is reused in the casting
process.
 KFIL has introduced a casting wing, which is fully controlled and automated by robots, hence
in turn reducing wastage and production efficiency.

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 A regular check is kept at every stage of manufacture of the pig iron to insure there is
minimum wastage.
 By adopting improvised techniques of production over time, the ovens which had been used
for heating and molding pig iron have recently been improvised with better technology,
which uses less power, conserves heat energy for a longer time, as well as makes the heating
process faster.

WASTE CONTROL STRATEGY

In order to survive in the market company follow waste control strategy the company maintains all
the materials in a systematic & in a scientific way, the best example is, company generates electricity
by making use of the waste gas. i.e. Co2 production during the production process.

3. SYSTEM:
Systems are formal and informal procedures that govern everyday activity, covering everything from
management information systems, through to the point of contact with the customer. Finance
department is doing enough to properly plan and control the funds. There is regular program
verification.

The Company has a proper and adequate system of controls in order to ensure that all assets are
safeguarded against loss from unauthorized use or disposal. All transactions are properly checked,
verified, recorded and reported correctly. Regular Internal Audit checks are carried out to ensure that
the responsibilities are executed effectively and that proper and adequate systems are in place.

 Internal control system

The company has proper and adequate system of controls in order to ensure that all assets are
safeguarded against loss from unauthorized use or disposal. All transactions are properly
checked, verified, recorded and reported correctly.
Regular Internal audit checks are carried out to ensure that the responsibilities are executed
effectively and that proper and adequate systems are in place.

 Inventory control system

Raw material will be held in the stores for 15 days only.
Finished goods will be held in the stores for 2 days.

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Corporate governance contains a set of principles, process and system to be followed by Directors,
Management and all employees of the company for increasing the shareholders’ value, keeping in
view interest of the other stakeholders.

While adhering to the above, KFIL is committed to integrity, accountability, transparency and
compliance with laws in all dealings with the Government, Customers, Suppliers, Employees, Other
stakeholders.

QUALITY CONTROL
The blast furnace is highly instrumented and is monitored continuously. Times and temperature are
checked and recorded. The chemical content of the iron ores received form the various mines are
checked, and the ore is blended with other iron ore to achieve the desired charge. Sample are taken
from each pour and checked for chemical content and mechanical properties such as strength and
hardness.
MARKETING DEPARTMENT
MARKETING POLICY

“In the direction of achieving the company’s mission, the marketing team- PIP endeavours for
maximization of sales and realization for the company’s product while meeting the customer’s
requirement to their all-round satisfaction”.

4. SKILL:
It consists of the capabilities and competencies that exist within the company. It is the talent, craft or
accomplishment, naturally acquired or developed through training and abilities appropriate for a
specific job. The employees need to have both specific as well generic skills. Generic skills mean
problem solving skills, decision-making skills, communication etc. Specific skill like time
management, shop floor management, building teams, leadership and motivation, creativity,
advances safety and environment, industrial safety and environment

Training there employees to enhance their knowledge and skill.

At KFIL, training is a continuous process to make their employees to meet the new challenges and
for their career growth. The training needs of managers are identified through competency mapping,

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skill matrix and also through PMS. They engage external Subject Matter Experts, apart from In-
house trainers to train their employees.

The training modules includes continual improvement programmes like KAIZEN, Six Sigma, 5'S',
Systems (TS-16949, EMS, OSHAS etc.) apart from programmes on Personality Development,
Leadership development, Behavioral subjects.

KFIL believe that development of employees is very vital for the success of the organization in a
competitive environment. They involve consultants of repute and individuals for regular programmes
to employees on leadership development. The modules are designed by these consultants and
individual faculty members to equip managers with a broader business perspective and tools and
technics required for various functions and also to enhance their career prospects.

True to their belief that an employee is an intangible asset, they organize leadership development
programmes to their managers at all levels to meet future business competition and always strive to
enhance knowledge and skills of the managerial personnel

5. STAFF:
It refers to the people working in an organization. The company’s people resources and how they are
developed, trained and motivated. The process of staffing includes various processes like recruitment
and selection procedures, training etc.

It refers to how the people are developed, trained, socialized, integrated, motivated and how the
employee’s career is shaped in an organization.

KFIL considers human resource to be an important valuable asset for the organization and therefore,
constantly strives to attract and recruit best talent for the current and future needs. The Company has
taken necessary steps to upgrade the skills of present employees by conducting various in-house
training programs and courses. Further measures for the safety of the employees are also adopted
through training programs on safety and mock drills. The total number of salaried employees is
1,251.

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Technical staff

These are the staffs they are responsible for the work related to technical aspect. In this company
they are appointing well- qualified and experienced persons as technical staff. So these staff will
have good knowledge about the working environment.

Supervisory staff

These are the person who is in charge with supervising the other employees in the organization. In
this company they are employing experienced staff as supervisor. So they can observe the fellow
workers and guide them as per the companies need. The experienced supervisors are one of the key
assists of this company.

Clerical staff

These assets are responsible for the office work. These people are the backbone of the company. If
they work well, it will be an asset to the company. In this company they are

Employee will & qualified employees for office work. These staffs are working together for
achieving companies objectives.

Designation No. of employees

Managing Director 1

Senior Vice President 3

Vice president 4

Associate vice president 1

Senior general manager 10

General manager 10

Deputy General manager 15

Senior manager 20

Managers 33

Deputy managers 55

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Senior engineers/officers 78

Engineers/officers 57

Assistant Engineers 34

Assistant officer 21

Assistants 71

Foreman 21

Charge man 97

Operator 312

Co Trainees 61

Apprentices 221

Total 1125

6. STYLE
This includes the Leadership style of Democratic and the overall operating style of the organization.
Style impacts the norms people follow and how they work and interact with each other and with
customer.

The management training is totally democratic there are no restrictions to any employee to express
his opinion. The company has got open door policy i.e. any level of employee can meet directly to
his superior or managing director without any hesitation.

Strategy refers to the systematic action and allocation of resources to achieve the companies aim.
The integrated vision and direction of the company as well manner, in which it drives, articulate,
communicates and implements that vision and direction. It can also be defined as the choice of
direction ad action that the company adopts to achieve its objectives in a competitive situation.

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7. SHARED VALUES:
It refers to the core or fundamental values that are widely shared in the organization and serve as
guiding principle that are important. These values have great meaning because they focus attention
and provide a broader sense of purpose. Values are things that you would strive for even if they
were demonstrably not profitable. Values act as an organization’s conscience, providing guidance in
time of crisis. The values and beliefs of the company ultimately they guide employees towards
valued behavior. It refers to the simple goal statements in determining corporate destiny to fit the
concept; most people in an organization must share these values.

VALUES
- Customer focus.

- Integrity

- Fairness & Partnership Development.

-Mutual Trust & Team Work.

- Agility with Discipline.

- Responsible Corporate Neighbor.

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CHAPTER-4
SWOT ANALYSIS

STRENGTHS:
The company has some its own strengths and competencies. They are as under:

 It adheres to the delivery at schedule for the customers.

 Located near the sources of iron ore mines.
 It enjoys economics of scale in manufacturing.
 It is well connected by rail and road way.
 Good brand image in the market.
 Market leader in quality.
 It is situated on the bank of river Tungabhadra.
 Availability of rich iron ore from the iron belts of Hospet and Sandur.
 Low power cost in manufacturing since they use their own generated electricity.
 Wide distribution network.
 The company has a good share in the market.

WEAKNESS:
Every company has its own weaknesses like this company also has some as below:

 Total dependence on china for coke.

 High coke consumption due to higher fines and handling costs due to multiple handling.
 Poor market share in eastern and northern part of the country.
 Company is facing pollution related issues for coke.

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OPPORTUNITIES:
The company has some opportunities in future for its growth. They are mentioned as under:

 The company has opportunities to tie up with customers.

 Can capitalize an upswing in market demand because of all India presence possible tie – ups
with major foundries in Gujarat market.
 As the company good market edge, it can market 20,000 per month of foundry grade pig iron
every month.
 Growth in Indian foundry capacity.
 Huge land is availability for future expansion.
 Technology in its operation.
 Chance of government restricting the export of iron in future encourage Indian steel factory.
 Strong financial position makes it possible for the company to adapt new.

THREATS:
 New foundry grade production entry
 Imposition of sales tax and VAT.
 Threats of using substitute products like plastic and fiber.
 Chance of government restricting the export of iron in future encourages Indian steel factory.
 Iron ore is a major raw material required for production of pig iron. Delay in starting of the
closed mines may force the Company to source the iron ore from outside the state, thereby
increasing the sourcing cost of iron ore and put pressure on profitability.
 Depreciation of Rupee vis-à-vis US dollar can lead to an increase in price of coke and in the
price of crude oil, resulting in increased input costs, thereby putting pressure on profitability

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CHAPTER-5
ANALYSIS OF FINANCIAL STATEMENT

Analysis of Financial statement:

It is a means of converting the mass of data into useful information. Analysis is largely a study of the
relationships among the various financial factors in a business as disclosed by the financial
statement.

Ratio Analysis:
Ratio analysis is a powerful & most commonly used tool of analysis and interpretation of financial
statements. It concentrates on the inter-relationship among the figures appearing in the financial
statements. Ratio analysis helps to analyse the past performance of the company & to make future
projections. It allows various interested parties, like management, shareholders, potential investors,
creditors, government & other analysts to make an evaluation of the various aspects of company’s
performance from their own point of view and interest.

Ratio analysis is the process of determining and interpreting numerical relationships based on
financial statements. A ratio is a statistical yard stick that provides a measure of the relationship
between variables and figures.

1) CURRENT RATIO
The Current Ratio is an index of the concern’s financial stability, since, it shows the extent to
which the current assets exceed its current liabilities. A higher current ratio would indicate
inadequate employment of funds, while a poor current ratio is a danger signal to the
management.

The ratio is an indicator of the firm’s commitment to meet its short-term liabilities.

Current Ratio = Current Assets

Current Liabilities.

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years Current Assets Current Liabilities Ratios

(in lakhs) (in lakhs)
2016-17 36606 30774 1.189
2015-16 28111 28562 0.984
2014-15 34109 38940 0.876
2013-14 41093 44073 0.932
2012-13 36441 35153 1.036
Table No. 1 (Calculation of Current Ratio)

Figure No.1 (Current Ratio)

1.4
1.189
1.2
1.036
0.984
1 0.932
0.876
0.8

0.6

0.4

0.2

0
2016-17 2015-16 2014-15 2013-14 2012-13

Ratios

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2) GROSS PROFIT RATIO (GPR)

Gross Profit Ratio indicates the overall limit within which a business must manage its operating
expenses. It also helps in ascertaining whether the average percentage of make-up on the goods is
maintained.

This ratio expresses the relationship between gross profit and net sales.

GPR = Gross Profit × 100

Net Sales

Table.2 (Calculation of Gross Profit Ratio)

Years Gross Profit Net Sales Ratios

(in lakhs) (in lakhs) (Percentage)
2016-17 12957 112710 11.49
2015-16 10680 111393 9.58
2014-15 9854 136509 7.22
2013-14 6921 123216 5.62
2012-13 7511 119811 6.26

Figure
Ratios No.2
(Gross
14
Profit
12 Ratio)
10 11.49

8 9.58

6 7.22
6.26
4 5.62

0
2016-17 2015-16 2014-15 2013-14 2012-13

Ratios

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3) NET PROFIT RATIO (NPR)

This ratio helps in determining the efficiency with which the affairs of a business are being
managed. Constant increase in the above ratio year after year is a definite indication of improving
condition of the business.

The Ratio indicates net margin earned on sale of 100.

NPR = Net Profit ×100

Net Sales

Table No.3 (Calculation of Net Profit Ratio)

Years Net Profit Net Sales Ratios
(in lakhs) (in lakhs) (percentage)
2016-17 9057 112710 8.03
2015-16 5773 111393 5.18
2014-15 4928 136509 3.61
2013-14 3983 123216 3.23
2012-13 3909 119811 3.26
`

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Figure No.3 (Net Profit Ratio)

Ratios
9
8
8.03
7
6
5
5.18
4
3 3.61
3.23 3.26
2
1
0
2016-17 2015-16 2014-15 2013-14 2012-13

ratios

4) FIXED ASSET TURNOVER RATIO

The comparison of fixed assets turnover ratio over a period of time indicates whether the
investment in fixed assets has been judicious or not. Of course, investment in fixed assets does
not push up sales immediately but the trend of increasing sales should be visible. If such trend is
not visible or increase in sales has not been achieved after the expiry of a reasonable time it can
be very well said that increased investments in fixed assets has not been judicious.
The ratio indicates the extent to which the investment in fixed assets has contributed towards
sales

Fixed Assets Turnover Ratio = Net Sales

Net Fixed Assets

Table No.4 (Calculation of Fixed Asset Turnover Ratio)

Years Net Sales Net Fixed Assets Ratios
(in lakhs) (in lakhs) (times)
2016-17 112710 59304 1.901
2015-16 111393 55826 1.995
2014-15 136509 57311 2.382
2013-14 123216 56909 2.165
2012-13 119811 48816 2.454

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Figure No.4 (Fixed Asset Turnover Ratio)

Ratios
3

2.5
2.382 2.454
2 2.165
1.901 1.995
1.5

0.5

0
2016-17 2015-16 2014-15 2013-14 2012-13

Ratios

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5) LIQUIDITY/ ACID TEST/ QUICK RATIO

The ratio is an indicator of short-term solvency of the company. A comparison of the current
ratio to quick ratio should also indicate the inventory hold-ups. For instance, if two units have the
same current ratio but different liquidity ratios, it indicates over-stocking by the concern having
low liquidity ratio as compared to the firm which has higher liquidity ratio.
The ratio is also termed as Acid Test Ratio or Quick Ratio. The ratio is ascertained by comparing
the liquid assets i.e., current assets to current liabilities.

Liquidity Ratio = Liquid Assets

Liquid Liabilities

Liquid Assets = Current Assets – Inventories – Prepaid Expenses

Liquid Liabilities = Current Liability – Bank Overdraft – Cash Credit

Table No. 5 (Calculation of Liquidity Ratio)

Years Liquid Assets Liquid Liabilities Ratios
(in lakhs) (in lakhs) (times)
2016-17 24298 21087 1.152
2015-16 18679 18738 0.996
2014-15 22172 31691 0.699
2013-14 24754 35568 0.695
2012-13 20786 28207 0.736

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Figure No.5 (Liquidity Ratio)

RATIOS
1.4
1.152
1.2
0.996
1
0.8 0.699 0.695 0.736

0.6
0.4
0.2
0
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Ratios

6) OPERATING RATIO
The Ratio is the test of the operational efficiency with which the business has carried on. The
operating ratio should be low enough to leave a portion of sales for giving a fair return to the
investor.
This ratio is a complementary of net profit ratio. In case the net profit ratio is 20%, the operating
ratio will be 80%.

Operating Ratio = Operating Cost ×100

Net Sales

Table No.6 (Calculation of Operating Ratio)

Years Operating Cost Net Sales Ratios
2016-17 25554 112710 22.67
2015-16 26041 111393 23.37
2014-15 28624 136509 20.96
2013-14 24945 123216 20.24
2012-13 24472 119811 20.42

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Figure No.6 (Operating Ratio)

RATIOS
24
23.37
23.5
23 22.67
22.5
22
21.5
20.96
21
20.42
20.5 20.24
20
19.5
19
18.5
2016-17 2015-16 2014-15 2013-14 2012-13

Ratios

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CHAPTER-6
LEARNING EXPERIENCE
EXPERIENCE IN ORGANISATION:
The primary objective of an internship is to gather real life working experience and put their
theoretical knowledge in practice. This was my 1st real experience to work in a Kirloskar ferrous
industries ltd. I was quiet nervous about it. During in 4 weeks of training I have developed a lot of
confidence and courage in this industry.

After going through this internship program lot of exposure to the overall working environment of
the organization and got to know about ‘MANAGEMENT SKILLS’, how to counter the problem,
and how to deal with different cadre of people. Also got a chance to meet lot of people whose ideas
and knowledge motivated to carry on the program.

The experience brought out my strength and also the areas I needed makeup. It added more
confidence to my professional approach built a stronger positive attitude and taught me how to work
in a team as a player.

In fact the main objective of this training is to help in tern (myself) to adapt to different work
conditions, be flexible and creative while working in the organization. I have tried to fulfill the same
in my internship report. I ensure this will help me in becoming better manager for tomorrow.

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Kirloskar ferrous industries LTD

Following are the learning experience that I have gained during my project.
The learning experience gained by me during the internship training was very much practical
oriented.
 Mostly all the concepts and theories, which I studied in the class, are applicable
practically.
 The overall study of the organization reveals that the company has been growing
tremendously.
 1 had great time working internship, as it gives insights into the working environment of
an organization.
 The training has exposed me to many factors of an organization and helped me to gain
practical knowledge.
 Time management
 Team work
 Communication skills.

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Kirloskar ferrous industries LTD

BIBLIOGRAPHY

BOOKS

 Financial Management, by K Prasanna Chandra, 5th edition.

 Accounting Management for Managers, by John Glynn.

JOURNALS/ MAGAZINES/ COMPANY RECORD

 Annual Report of the Industry.

 Company Profile.

WEBSITES

www.kirloskar-electric.com
www.kirloskarpcl.com

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