Organization study at chamundeshwari sugar

Sri Chamundeswari Sugar Limited
___________________________________________________________

CHAPTER – 1

INTRODUCTION

Sugar is a major form of carbohydrates and is found probably in all green
plants. They occur in signification amounts in most fruits and vegetables. There are
three main simple sugars sucrose, fructose, and glucose. Sucrose is in fact a
combination of fructose and glucose and the body quickly breaks down into these
separate substances.

HISTORY

The discovery of sugarcane from which sugar was produced had been known since
thousands of years. It is thought to have originated in New Guinea, and was spread
along routes to Southeast Asia and India. The process known for creation of sugar, by
pressing out the juice and then boiling it into crystals, was developed in India around
500 BC.

Its cultivation was not introduced into Europe until the middle-ages, when it was
brought to Spain by Arabs to thrive in a most favorable climate.

Dept. of Mgmt. Studies, SAMS, Bangalore 1

___________________________________________________________
It was not until the eighteen century that sugarcane cultivation was began in the
United States, where it was planted in the southern climate of New Orleans. The very
first refinery was built in New York City around 1960; the industry was established
by him 1830s. Earlier attempts to create a successful industry in the U.S. did not fare
well; from the last 1830s, when the first factory was built. Until 1872, sugar factories
closed down almost as quickly as they had opened. It was 1872 before, built in
California, and was finally able to successfully produce sugar in a profitable manner.
At the end of that century, more than thirty factories were in operation in the U.S.

INDUSTRY PROFILE

Indian sugar industry is going through a rough weather on account of decline in
international / domestic market prices for sugar, higher cost of production, high carry
over of stocks, higher cane price fixed by some state government through the
SAP(state advised price) than the SMP (statutory minimum price) announced by the
government of India have initiated certain measures such as rationalization of sugar
cane prices, operationalisation of futures /forward trading etc., aiming to complete
decontrol of sugar industry. Export incentives like inland transport subsidy up to port
for export of sugar are also offered. To tide over surplus stocks of sugar, the
government of India have approved three exchanges for futures /forward trading in
sugar viz. e-commodities Ltd., Mumbai; NCS InfoTech Ltd.,


___________________________________________________________
Sugar is most important agro based industry of India and it has marked place in the
country’s economy the reforms the liberalization policies of government of India are
fast taking place and changing the industry scene in the country in the country.
However it appears that the winds of liberalization and deregulation with are blowing
presently through other industrial sectors has bypassed the sugar industry.

More over Indian sugar industry have spread over mainly in rural areas, as such major
share of benefits should flow towards rural population. Besides present position of the
industries shake less the policy of supporting farming economy by increasing sugar
cane prices will ultimately raise the sugar crop. So emphasis has to be towards cane
development both by Yield and quality. So at this junction it would be appropriate to
consider, if no full liberalization at least partial by eliminating some of the undesirable
constraints which would help industry in the changing environment when India needs
to increase its foreign earnings, in the world market. India has been known as the
original of sugar and sugarcane. Indian mythology support the above fact as it
contains some legends showing the origin of sugarcane, the growth of the sugar
industry is full of tales of adventure and conquest.

Hyderabad and e-sugar India, Mumbai, the introduction of futures trading may help in
correcting the price distributions, but for it to be effective, the mounting stocks should
be managed properly. India has emerged as the largest producer in the world. The
sugar production in India during 2001-2002 seasons was around 183 lakh tones with
the carry over of stocks of around 118 lakh tones of the previous season. With the
internal consumption of 160 lakh tones and exports of around 10 lakh tones, the
industry is estimated to be saddled with the carry over stock of around131 lakh tones
to the 2002-03 seasons. As on April 30-2002, the co-operative sugar mills had a stock
of 114.73 lakh tones.


___________________________________________________________

MANUFACTURING PROCESS & TECHNOLOGY

Sugar (Sucrose) is a carbohydrate that occurs naturally in every fruit and vegetables.
It is a major production of photosynthesis, the process by which plants transform the
sun’s energy into food. Sugar occurs in greatest quantities in sugarcane and sugar
beets from which it is separated for commercial use. The nature sugar stored in the
cane stalk or root is separated from rest of the plant material though a process as
refining.

For sugarcane, the process of refining is carried out in following steps

 Pressing of sugarcane to extract the juice.
 Boiling the juice until it begins to thicken and sugar to crystallize.
 Spinning the crystals in a centrifuge to removed the syrup, producing raw
sugar.
 Shipping the raw sugar to a refinery where it is washed and filtered to
remove remaining non-sugar ingredients and color.
 Crystallizing, drying and packaging the refined sugar.

For the sugar industry, capacity utilization is conceptually different from that
applicable to industries in general. It depends on three crucial factors the actual
number of ton of sugarcane in a day, the recovery rate which generally depends on the
quality of the cane and actual length of the crushing season.

Since cane is not transported to any great extent, the quality of the cane that a factory
receives depends on its location and is outside its control. The length of the crushing
season also depends upon location with the maximum being is South India. Sugarcane
in India is used to make either sugar, khandsari basic categories, granulated, brown,
liquid, or invert sugar.


___________________________________________________________

SUGAR IN INDIA

Sugar is a controlled commodity in India under the essential commodities act, 1955.
the government controls sugar capacity additions through industrial licensing
determines the price of the major input sugarcane, decides the quantity that can be
sold in the open in the open market, fixes the prices of the levy quota sugar and
determines maximum stock levels for wholesales, etc.,

India is the largest consumer and second largest produces of sugar in the world. With
over 450 sugar factories located throughout the country, the sugar industry is amongst
the largest agro-processing industries in India, with an annual turnover of Rs
150bilion.

India has been known as the original home of sugarcane and sugar. Indians knew the
art of making sugar since the forth century. However the advent of modern sugar
industry in India dates back to mid 1930s when a few vacuum pan units were
established in the sub- tropical belts of Uttar parades and Bihar.


___________________________________________________________

Until the mid 50s the sugar industry was almost wholly confined to the states of Uttar
Pradesh and Bihar. After late fifties or early sixties the industry dispersed into
southern India, western India and other parts of Northern India.

India is the largest consumer and second largest produces of sugar in the world. The
sufficient and well-distributed monsoon rains, rapid population growth and substantial
increases in sugar production capacity have combined to make India the largest
consumer and largest produces of sugar in the world.

With over 450 sugar factories located throughout the country, the sugar industry is
amongst the largest agro processing industry, with an annual turnover of Rs 150bn. It
plays a major role in rural development and its importance for India stretches far
beyond the role of a sweetener supplier.

The sugar factories located in various parts of the country work as nuclei for
development of rural areas by mobilizing rural resources and generating employment,
transport and communication facilities. Over 45mn formers, their department and a
large mass of agriculture labor are involved in sugarcane cultivation, harvesting and
ancillary activities constituting 7.5% of the rural population. The sugar industry;
employs over 0.5mn skilled and unskilled workmen, mostly from the rural areas.

After alternating between control and decontrol, the government adopted the policy of
partial decontrol in 1967-68, which has since been the mainstay of government policy
except for two short periods of decontrol in the 1970s. Under this policy, the
government procures 40% of production at controlled prices based on the statutory
minimum price for sugarcane, for supply through the public distribution system.

And the balance 60% is allowed to be sold by the mills in free market subject to the
monthly release mechanism.

The levy quota for sugar mills has been brought down from the peak levels of 70% in
1968-69 to the present levels of 40% as a gradual process of deregulation of sugar
industry.


___________________________________________________________

The number of operating sugar mills in the country has increased from 29 in sugar
year (SY) 1930-31 to 1969-97 (sugar year October 1st to September 30th ). The
addition in number of mills was at its peak during seventies that when nearly 100
mills were added between 1970 and 1980 to increase the number of operating units to
300.

SUGAR DEMAND

Demand for sugar increased with the growing world population, and even faster,
perhaps because improving technology made its production cheaper. In the 1980s
when the world population was 1,000 millions tones, recorded sugar production was
800,000 tones a year. By 1900 it was 8 million, by the mid-1970 with a world
population in excess of 4,000 million, world production of sugar was about 80 million
tones, almost equally divided between sugar cane and beet. Today annually
production stands at 115,000,000 tones.


___________________________________________________________

CHAPTER -2
RESEARCH DESIGN

STATEMENT OF THE PROBLEM

Channarayapattana is one of the major cities in Karnataka state. Major raw material
viz., sugar cane for sugar factory is available in and around the city. The importance
of study lies in the fact that there has been no systematic and comprehensive study in
the tax by researchers on working capital management with reference to the unit seeks
further this study. The study covers a brief history of Chamundeswari Sugar Limited,
(Lessee of H.S.S.K Ltd.,) , its performance and working capital management system
of Chamundeswari Sugar Limited,(Lessee of H.S.S.K Ltd.,)The study also covers the
receivable management, inventory management and cash management.

OBJECTIVES OF THE STUDY

The following are the main objectives of the study

 To study the management of current assets and current liabilities with
respect to working capital management in Chamundeswari Sugar Limited,
(Lessee of H.S.S.K Ltd.,)

 To study the factors responsible for the increase to decrease in the level of
working capital in Chamundeswari Sugar Limited,(Lessee of H.S.S.K
Ltd.,) during study period.

 To study the existing system of receivable management, inventory
management of Chamundeswari Sugar Limited,(Lessee of H.S.S.K Ltd.,)
To evaluate the working capital policy


___________________________________________________________
 To highlight the structure and utilization of working capital and to asses
the liquidity position of Chamundeswari Sugar Limited,(Lessee of
H.S.S.K Ltd.,)
during study period.

 To study the organization structure of the company and functioning
various department.

 To offer suggestion for the improvement in the management of working
capital.

SCOPE OF THE STUDY

The study examines the working management in Chamundeswari Sugar Limited,
(Lessee of H.S.S.K Ltd.,).The focus is only on analyzing and evaluating effectiveness
of working capital management in Chamundeswari Sugar Limited,(Lessee of H.S.S.K
Ltd.,) The issues relating to working capital management include:

1. How much money is to be invested in current assets.
2. Management of Account Receivables.
3. Management of Inventory.


___________________________________________________________
SOURCES OF DATA

It is very well known that success or failure of the research depends upon the data.
Therefore, selection of appropriate methodology for collection of relevant data is
important. The sources include both primary and secondary sources.

PRIMARY Personal interview with
SOURCES OF CAO and other top-level
DATA officers

SOURCES OF
DATA

Company annual reports

SECONDARY
SOURCES OF Journals
DATA

Magazines


___________________________________________________________
Limitations of the Study

The limitations of the study are:
1. The study is confined only to HSCL.
2. The study is restricted to only the current assets and current liabilities. Hence,
the study of fixed assets and capital are excluded in this study.
3. The major part of the analysis has been based on the audited financial reports
of HSCL.

.


___________________________________________________________
CHAPTER - 3
COMPANY PROFILE

Chamundeswari Sugar Limited,(Lessee of H.S.S.K Ltd.,)is established in the year of
1984 in the interest of local farmers and pre planned to provide job for the soil sons
under the register no 2599/73-74. The plant was erected by buck Wolf Company from
Pune, it is having capacity of 1250 TCD per day. The first estimated cost of the
factory increased up to 7.3 crore. After this cost it is not enough for establishment of
factory. So the third estimated cost of this project is 9.70 crore. Today’s establishment
of factory cost approximately more than 50crore..

The site was selected for the location of the factory near the village Srinivaspura 6-
Km from Channrayapatna taluk head quarter which is situated at an NH 48 on BM
road which is 150 km from Bangalore.

The Government of Karnataka granted 150 acres of land near Srinivasapura village.
The river Hemavathy is flowing at about 2.5 km from the site. Water is constantly fed
from the river water by factory jack well pump.


___________________________________________________________
The starting moment of the factory, some important technicians were called from the
other factories only for trial season. After some employees were selected on their
experience and remaining employees were selected on contract basis. Ultimately the
contract employees were appointed in the year of 1991 -92 according to the rules
these posts are approved by the director of sugar, Karnataka govt Bangalore (as per
staffing pattern). At present the total strength of the employees working in this factory
is 567.

PRODUCT SERVICE PROFILE: -

CANE: -
Sugarcane is a plant is mixing more CO2 by efficient process of photosynthesis and
translucent. The sugar synthesized in the leaves or translated to the steam in the form
of sucrose and is converted into glucose and other sugars. The glucose molecules are
used for the developments of the plant at the growth phase. Sugarcane contains about
14% fiber and 86% juice, sugarcane juice consists of 13% of sucrose and 73%
moisture and non-sugar solids. The transport of sugarcane from farmers to the factory
will be engaged through Lorries which will be taken through bidding at the time of
harvesting and also farmers themselves supply by their own bullock carts or by
tractors.

For the purchase of other raw materials Manager will receive the material requisition
slips from the usage department, which should be signed by all the department heads
and by the General Manager. Then the purchase department will evaluate the list of
vendors and the tabulated comparative statement will be sent to the usage department.
Then on the basis of the opinion of the usage department the purchase department will
send a file to the management, and then on the basis of this file the purchase
department will place the purchase order.


___________________________________________________________
Cane varieties in Chamundeswari Sugar Limited, (Lessee of H.S.S.K Ltd.,)

1) CO 419.
2) CO 7804.
3) COC- 671.
4) CO 8371.
5) CO 62175.
6) CO 8014.
7) CO 32175.

PRODUCT DETAILS:

CANE HANDLING:

The transport system of cane should be established for efficient supply of cane. At
present 80% of the cane crushed per day is through tractors and Lorries and 20% by
bullock carts. The transport is entirely arranged by the growers. The cane is unloaded
on the feeding table after measuring the weight.
.
CANE SUPPLY:

The indent for crushing cane is given by the chief engineer to the agricultural dept
daily. The agricultural dept allots the cane quota to each circle in three days in
advance.
The laboratory section takes the samples of the cane from the cane yard randomly and
makes the analysis for the expected recovery and external material percent cane. If
both are beyond the normal level, instruction will be sent to agricultural dept. to staff
the harvesting of the particular cultivator field or farm.


___________________________________________________________
QUALITY POLICY

CANE QUALITY:

The cane should be free from traps, tops, dirt, soil etc. After unloading the cane from
the trucks the company has arranged contract labors to remove the remaining dry
cane, water shoot trash, binding materials etc from the cane supply to the factory. This
practice improves not only the quality of cane but also the efficiency of the factory
performance.

AREA OF OPERATION: -

SUGARCANE GROWN AREA:

Sugarcane is grown in 130-140 villages under different circle names mentioned as
bellows:

SL.NO. Name of the circle
1 Channarayapattna-1.
2 Hassan.
3 Holenarasipura.
4 Kikkeri.
5 Shravanabelagola.
6 Srinivasapura.

Area of operation means, the place where the company carries business operation
companies is always used to carry business, where the required resources are easily
available. Area of operation plays a vital role while fixing price, there by development
of the company. Because if the area has suitable environment , raw material, labors
for less wages , then it will reduces the cost of production.


___________________________________________________________
OWNERSHIP PATTERN:

It is a government based company and major contribution for this company is from
the state government, and remaining contribution is from the share holders of the
company. And the company is mainly controlled by govt. Company conducts
election to elect president for the company, and share holders has voting power for
this election, and these are the members for the company. If any members have any
queries they can discuss with president in the meeting. In case president absence, they
can meet general manager for the solution. Now the president of H.S.S.K Ltd is Sri
H.S Shrikantappa .The entire union is controlled by president of the company. If the
company earns profit, profit will be distributed to the formers based on their
contribution.

VISION:

“To achieve organizational profitability by attaining the high level of productivity, to
earning the trust of customer, and providing better value for sugar cane to attract the
customer”.

MISSION:

• To increase their sales.
• To achieve the recovery level of 9.5% at the end of 2008
• During 2007-2008 company has a target to crush a sugar cane of 250000 MT.
• To increase quality of the product & fulfill the needs of the customer.


___________________________________________________________
GOALS AND OBJECTIVES:

• The sugar union was started 16-06-1973 and it has started from crushing from
1984. They want to develop their product union like CO-OPERATIVE
SOCIETY.
• To increase quality of sugar.
• To increase their sales.
• Increase the sales by conducting many programs like consumer information
programs.
• To increase the members of the union.
• To regularly supply there product all the customers according to customer
needs.

COMPETITORS INFORMATION

H.S.S.K Ltd has many competitors in different places around there area, and the main
competitors are from MANDYA sugar factory. They attract customers by providing
some benefits in terms of traveling expenses. There is a more competition mainly
through supply of sugar cane. Company set a proper equivalent price to the sugar cane
to attract more customers, and make good relation with the customers through cash
settlements for sugar cane purchase.

INFRASTRUCTURAL FACILITIES

The factory premises have an area by 86.22 acres of land. In the premises has there is
a factory building, management office, accounting section, cane department, cane
yard, quarters, weight bridge, cane sugar & 20 acres of land to undertake Research &
Development.


___________________________________________________________
Present sugarcane plantation in the year of 1998-99 as given below,

SI NO Name of the circle 1998-99
1. Channarayapattna-1 2624
2. Srinivasapura 1507
3. Holenarasipura 1684
4. Kikkeri 533
5. Hassan 307

Nearly 85% of cane area is under wet land condition and 15% of cane area is under
dry lands.

ACHIEVEMENTS

1. It has been awarded as the good infrastructure In the Karnataka in 1994.
2. It achieves more profit during 1989 in the Karnataka.
3. It has been awarded as the best quality product producer by the government of
Karnataka.
4. It holds more number of customers and it has many share holders with good
relation, they are the strength of the company.

CHAPTER – 4


___________________________________________________________

DEPARTMENTATION

INTRODUCTION

Department is s a process of dividing the large functional organization in so small and
flexible administrative units. The basic need of departmentation arises because of
limitation on the number of subordinates that can be directly managed by the superior.

BASIS OF DEPARTMENTATION

Departmentalization may be on the basis of function, products, regions, customers,
process, time, number, and marketing channel

Functional basis is a very popular method of departmentalization. It refers to grouping
of activities of the organization into major functional departments like, production,
purchase, and marketing act.

In Chamundeswari Sugar Limited, (Lessee of H.S.S.K Ltd.,) departmentalization is on
the basis of function. The major functional departments of Chamundeswari Sugar
Limited,(Lessee of H.S.S.K Ltd.,) , are as follows.

ORGANIZATION STRUCTURE

Organization structure is a basic framework within which the decision making
behavior of executives takes place. It is an established pattern of relationship among
the components of the organization. Chamundeshwari sugar industry limited is
headed by the Chairman under whom M.D. and can advisor will take place. This crew
guides the G.M. who is assisted by the department manager and heads.


___________________________________________________________

ORGANIZATION
CHART

CHAIR PERSON

BOARD OF DIRECTORS

Mechanical Dept. Production Department Power Plant Dept Cane Dept. ADM/TIME/OFFICE

GM (Tech) Admn. Manager
Chief Chemist Duty Engineer Cane Manager
and. Officer
Chief Engineer
Sr. Mfg. Chemist Asst. Engrs. Dy. Cane Manager
Sr. Engineer Asst. Per. Officer
Mfg. Chemist Turbine Optrs Asst. Cane Dept
Officer
Asst. Engineer Asst. Admn Officer
Panamaa Bioler Optrs
Cane procurement Asst. Time
Shift Engineer officer Keeper
Centrifugal Optrs Fitters

General A/c section Workshop section Eng. Dept Store Section
Sales Dept.
Dy. Foreman
Boiling House Filter Chief Engr Head Store Keeper
Manager(Finance)
Turners Sale I/C
Sr. A/c’s Officer Welders Sr.Engr. Computer Optr
Welders Sales Officer
Accountant Fitter Helpers Asst. Engr. Clerk
Mechanist
Assistants
Cashiers
Helper Fitter Store Boys


___________________________________________________________

1 PURCHASES DEPARTMENT

2 STORES DEPARTMENT

3 ADMINISTRATION DEPARTMENT

4 FINANCE DEPARTMENT

5 CANE DEPARTMENT

6 ENGINEERING DEPARTMENT

7 SALES DEPARTMENT

8 CHEMICALS DEPARTMENT


___________________________________________________________

PRODUCTION DEPARTMENT

PRODUCTION DEPT

CHIEF CHEMIST

SR.MFG. CHEMIST

MFG. CHEMIST

PANAMAN

CENTRIFUGAL OPTRS

JUICE SUPERVISOR

SUGAR HOUSE
CLERK


___________________________________________________________

PRODUCTION ACTIVITY
The department deals with the production activities on the production floor
where men and machines are employed to convert the cane and chemicals into
finished product (sugar) for handling them over to sales department.

PRODUCTION PROCESS
Sugar (sucrose) is a carbohydrate that occurs naturally in every frurt and
vegetable. It is a major product of photosynthesis, the process by which plant
transform the sun’s energy into food. Sugar occurs in greatest quantities in sugarcane
and sugar beets from which it is separated for commercial use.


___________________________________________________________

The natural sugar stored in the cane stalk or beetroot is separated from rest of
the plant material through a process known as refining. For sugarcane, the process of
refining is carried out in the following steps:

1. Pressing of sugarcane to extract the Juice.
2. Boiling the juice until it begins to thicken and sugar begins to crystallize.
3. Spinning the crystals in a centrifuge to remove the syrup, producing raw sugar
4. Shipping the raw sugar to a refinery where it is washed and filtered to remove
remaining non-sugar ingredients and color.
5. Crystallizing, drying and packaging the refined sugar.

For the sugar industry, capacity utilization is conceptually different from that
applicable to industries in general. It depends on three crucial factors-the actual
number of ton of sugarcane crushed in a day, the recovery rate that generally depends
on the quality of the cane and actual length of the crushing season.

Since cane is not transported to any great extent, the quality of the cane that a
factory receives depends on its location and is outside its control. The length of the
crushing season also depends UJKMI location with the maximum being in south
India.

FERTILIZER
Mud and spent wash from distillery plant are mixed and fertilized is
produced. Fertilizer later is transported to fields of farmers who gave ordered for.


___________________________________________________________

PRODUCATION PROCESS

CANE PREPARATION

STEAM

CANE PREPARATION
WATER ---------------------------------------------------------------------BAGASSES
RAW JUICE
BOILER

EXHAUSTED STEM ----------------------- CONDENSATE

SULPHURED JUICE FILTERED JUICE

SULPHUR DIOXIDE

EXHUSTED STEAM -------------------------------- CONDENSATE

WATER
CLEAR JUICE

EXHUSTED STEAM---------------------------------- JUICE+MUD MUDE

SURUP
SULPHUR DIOXIED ----------------- ------------- VAPOURS

EXHAUSTED STEAM----------- ---- ------ CONDENSED
MOLASSES
CLEAR JUICE

STEAM OR SUPAER
HEAT WASH WATER
GODOWN
CLEAR JUICE


___________________________________________________________

PURCHASES DERPARTMENT
The head of the department heads purchasing department. Purchasing
decisions are divided into two. One for purchase of capital assets and another is
regular purchase.

Purchase of capital assets requires approval of management

CONSIDERABLE POINTS WHILE PURCHASING CAPITAL ASSETS

• life duration of the asset
• cost of the asset
• capacity etc.,

REGULAR PURCHASES

Indent from the user is original document to issue purchase order for regular purchase
of materials and goods.

PROCESS:
 Receiving indent from user.

 Calling tenders if necessary.

 Preparing purchase order.

 Ordering to supplier.

 Making purchase return if the material doesn’t match order.


___________________________________________________________
STORE DEPARTMENT

HEAD STORE KEEPER

COMPUTER OPERATIONS

CLERKS

STORE BOYS

Stores dept. holds the entire inventory required in the organization. All
the materials coming are subject to record at stores and are held in the stores until they
are issued to the required department.


___________________________________________________________
FUNCTIONS:
1. Receipt of materials.
2. Inspect it with ordered quantity quality and any specifications.
3. Some of the materials like chemicals are to be sent to laboratory for inspection
and testing.
4. Getting indents from the departmental head or the concerned person and
issuing it
5. To make purchase-returns if the materials are rejected.
6. Maintain minimum level of material.
7. Informing purchase department when materials require.

MATERIALS HANDLED

A. Engineering: tools, Spares.

B. Raw-materials.

C. Stationery.

D. Packing materials.


___________________________________________________________
ADMINISTRATION DEPARTMENT

At Hemavathi sugar Ltd., has administration department control and
monitor the activities of time arid security personnel. Human Resource Development
is the challenging function in front of administration department.

GENERAL MANAGER

ADMINISTRATION
MANAGER

PERSONNEL DEPT TIME OFFICE SECURITY


___________________________________________________________
PERSONAL DEPARTMENT

FUNCTIONS;

1. To maintain the Personnel administration of the manpower strength of 350.

2. Recruitment and selection: The advertisements for recruitment of employee
are made though leading news papers. Apart from this as a statutory
obligation, Hemavathi sugar Ltd., appoint trainee also. Among the application
received, eligible candidates are selected though scrutiny competent
candidates are appointed for the job.

3. Training and development: Training and development skills to newly
employed. Training is necessary production, mechanical and electrical
department. On the job training is arranged at the plant.

4. Remuneration: Remuneration refers to the reward for labor and service.
Basically remuneration is fixed on the basis of hours worded. Each shift is of
8hours and 3 shifts a day.

FRINGE BENEFITS

• Canteen facility.
Food is providing at subsidized rates.

• Transportation facility.
Cars are providing to managerial levels and executives. Supervisors
are given two wheelers.

• Housing facility.
The company has its own quarters and providing quarters to employees.


___________________________________________________________
TIME OFFICE

Objectives of time office are:

 Keeping attendance records for administration and payment purposes.

 Maintaining records for giving increments and promotions.

FINANCE DEPARTMENT


___________________________________________________________

Finance is the lifeblood of any business it is concerned with the activation of
funds and wide application on the funds. The success of a business lies with the
effective management of finance in the company. Finance management is that
managerial activity, which is consumed with the planning and controlling of the
firm’s financial resources.

It is the most important department in which most of the functions are carried
out such as accounting, planning, mobilization and effective utilization of funds.

OBJECTIVES:

 Dealing with Banks and finance institutions.
 To monitor the budget and budgetary control.
 Monitoring the funds, collection and payments.
 Finance planning and mobilization of cash.
 Controlling inflow and outflow of cash.
 To exercise cost control and cost reduction techniques.
 To see that financial interest of the company.
 To protect the financial interest of the company.
 It helps in achieving the business results profitably.
 Waste management.

SOURCES OF FINANCE:

 ICICI.
 IDBI.
 IFCI.
 Corporation Bank.
 Canara Bank.
 Vijaya Bank.
 Syndicate Bank.
 State Bank of India.


___________________________________________________________
 Government of Karnataka

CHART OF FINANCIAL DEPARTMENTS

MANAGING DIRECTOR

FINANCE MANAGER

DEPUTY FINANCE
MANAGER

ACCOUNTS OFFICER

ACCOUNTS CASHIER


___________________________________________________________
ACCOUNT ING DEPARTMENT

INTRODUCTION :
Chamundeswari Sugar Limited,(Lessee of H.S.S.K Ltd.,) is an industrial
organization manufacturing sugar, power, and ethanol accounts department of HSCL
plays role in achieving objectives

NEEDS FOR ACCOUNTING SYSTEM:

 To ascertain the profit and loss of the business.

 To ascertain the financial position of the business.

 To providing control over assets and properties of the company.

 To providing information to tax authorities like, sales tax, income tax, control
excise etc.

 Assistance to management on
a) Decision-making
b) Forward planning and budgeting.
c) Controlling various management functions.

 To provide information to government central, state and various local bodies.


___________________________________________________________
CANE DEPARTMENT

INTRODUCTION

Cane is the only raw material for producing the sugar. Cane department keeps the
direct link with farmer to procurer and the development of the cane.

SUGARCANE

In India Sugar is produced only from Sugarcane, as the country’s climatic conditions
are suitable for cane cultivation sugarcane being agricultural crops subject to the
unpredictable vagaries of natures, yielding either a bumper crop of a massive shortfall
in its cultivation from year to year.

The quality of sugarcane improves with age, reaching a peak, and gradually declining.
A rapid deterioration begins from the most purity of juice cane has to be crushed
within 8 to 10 hours of cutting

The usual sugarcane constituents along with their content I sugarcane as a % of total
weight is as given below

SUGARECANE CONSTITUENTS

Constituent % of total weight

Water 69-75

Sucrose 8-16

Reducing sugar 0.5-3

Organic substances 0.5-1

Nitrogenous bodies 0.5-1

Ash 0.3-0.8

Fiber 10-16


___________________________________________________________
Rainfall and temperature are the two important determining factors for the yield and
quality of sugarcane, although reduced level of rainfall can be substituted by
irrigation or sprinkling of cane water.

Even ton of cane cultivation requires approximately 60-70 ton of water under
controlled conditions. But under field conditions the water requirement for
sugarcane varies with variations in soil and climatic conditions. The efficiency of
water uptake and use varies with different varieties.

Sugarcane yield in the country has doubled in the past sixty five years from 30.90
ton per hectare in SY 1930-31 to 66.5 ton hectare in SY 1996-97. The sugarcane
yield has decreased since the peak 71.3 ton per hectare in SY 1994-95.

The sugarcane yield varies widely across the country in the range of 40 to 100 ton
per hectare. Tamilnadu and Karnataka lead among the states with a yield of 100 to
85.7 ton per hectare respectively. Madhya Pradesh and Bihar have the lowest yield
in the country in the range between the quantities of 40 tons to 44 tons per hectare.

SUGARCANE JUICE

Sugar cane juice is acidic in nature. Besides sugar it contains many other organic
and inorganic and soluble as well as insoluble substance in varying amounts,
together called as non-sugars, to the extent of 3 to 7.5 % of total quantity. These
insoluble suspended matters make the juice viscous and turbid. The constituent of
sugarcane juice as a percentage of total quantity is as given below.


___________________________________________________________
SUGARCANE JUICE CONSTITUENTS

Constituent % of total quantity

Water 75-85

Sucrose 10-21

Other sugar 0.3-3

Other organic Substances 0.2-0.6

Nitrogenous bodies 0.5-1

Bricks Test must be made before cane is cut. It is also called Recovery Test

OBJECTIVES OF CANE DEPARTMENT

1. To procure the cane at proper time and at proper condition.
2. To look after the transportation of cane from farmers through trucks tractors
and carts.
3. To develop the cane and giving proper guidelines to grow.
4. To keep and maintain concerned land database.
5. Hiring trucks and tractors.
6. Harvesting cane.

CIRCLE OFFICES

Assistant Cane Development Officer heads the circle office. There are ten circle
officer located at different places surrounding from where cane is being procured.
Supervisors assist circle officer.

Supervisors are to report corresponding circle offices. Weekly report has to be sent to
the Cane manager.


___________________________________________________________
CHART OF CANE DEPARTMENT

GENERAL MANAGER (CANE)

CANE MANAGER

DEPUTY CANE MANAGER

CANE DEVELOPMENT
SUPERVISORS

CLERKS


___________________________________________________________
SALES DEPARTMENT

SALES INCHARGE

SALES OFFICER

ASSISTANTS

INTRODUCTION

Sales Manager is in charge of the sales department. The sales department takes care of
all the sales. The Asst. Sales Manager has to supervise the sales.

Marketing and advertisements are not necessary in sugar industry, because customer
won’t ask for specific company produced sugar and that not even separable. Anyhow
the contacts with dealers and agents are to be developed.

FUNCTIONS

As mentioned above, marketing and advertising efforts are not made to promote sales.
But the sales department has to keep in contact with dealers and agents.

• Getting orders from parties.
• Arranging for delivery to parties.
• Maintaining records of sales.
• Sending reports to Managing Director (Head Office)


___________________________________________________________
EXPORTS

Sugar is exported to Middle-East and European countries.

DEMAND-SUPPLY, IMPORT-EXPORT

DEMAND

Indians by nature have a sweet tooth and sugar is a prime requirement in every
household. Bulk consumers like bakers, candy makers, sweet madders, and soft drink
manufacturers consume almost 75% of the sugar available in the open market.
Khandsari sugar is less refined and is typically consumed by sweet makers. Gur an
unrefined form of lumpy brown sugar, is mostly consumed in rural areas, and with
some quantities illegally diverted for alcohol production.

Industrial consumption for sugar is also growing rapidly particularly from the food-
processing sector and sugar based bulk consumers such as soft drink and ice cream
manufacturers.

The demand for sugar has increased from 3.69million ton in SY 1975-76 to 14.8mn
ton for SY 1997-98 at a CAGR of.6.48%. The per capita consumption of total sugar
(Gur & Khandsari) in the country has been increasing at phenomenal rate. The total
per capita consumption has increased form 19.8 kg in SY 1975-76 to 2455 kg in SY
1997-98.

It is evident from the table (2) that in states with a higher net per capital state domestic
product and also a higher proportion of urban population. The consumption of sugar is
significantly higher and compares favorably with developed countries such as the
USA and countries of the I’TJ. In fact, in urban areas of comparatively affluent Indian
states like Punjab, Haryana etc., per capita consumption of sugar is substantially
higher.

SUPPLY


___________________________________________________________

Indian sugar industry has grown horizontally primarily because of GOL policy to
support small size sugar factories by excluding them from the requirement of
supplying.

The production of sugar has increased in the past from 0.12mn ton in SY 1930-31 to
12.85mn ton in SY 1997-98 at a CAGR if 7.23%. The number of operating sugar
mills for the corresponding period has i9ncreased from just 29 in SY1930-31 to
around 412 in SY1997-98. The addition of mills was at its peak during the period of
seventies and eighties when 100 and 70 new mills respectively were commissioned.

The sugar production in the country fluctuates widely based on sugarcane availability
in the country. For example; the sugar production increased in SY 1991-92 by 58% to
13.4 million ton, but decreased in SY 1993-94 by 27% to 9.83 million ton. Similarly
the production increased in SY 1995-96 by 67% to 16.45mn ton, but decreased by
22% in SY 1996-97 million tons.


___________________________________________________________
S-30 grade sugar has the maximum production in the country constituting around 72%
of the total; production. The remaining 24% is of M-30 and the rest is from L-30 and
the other different grades under 29 series.

IMPORTS

The government controls import of sugar thought policy and custom duties based on a
demand-supply mismatch in the county.

In the past, imports were allowed only though government agencies or institutions,
but since 1997, private were allowed to import and distribution sugar in the country.

In 1997, sugar was placed under Open General License (OGL) and allowed to be
imported at zero import duty, so as to overcome the domestic shortage of sugar
production. This led to a sudden spurt in imports to 0.94mn to for SY1997-98

The zero import duty was continued in the early part of 1997-98 season in spite of a
bumper crop of sugarcane leading to excess supply and closing stock in the industry,
the slowdown in demand in other Asian countries only further added to boost exports
from other Asian countries into India, which have freight cost advantages.

Pakistan and Brazil are the major exporters of sugar to the country. Pakistan has
advantages of freight cost and provides a subsidy of Rs.4 per kg for exported sugar.

To overcome the problem, the GOI announced customs duly of 5% and valorem and
countervailing duty of Rs. 850 per ton on 26th April 1998. But the devaluation of
Asian currencies along with a depression in the region pushed up the supply through
imports in to the country.

In September 1998, all imports were asked to register with APFPDA (Agricultural
and Processed Food Products Development Authority) so as to monitor the amount of
sugar imported into the country, presently imports are mainly carried out by


___________________________________________________________
multination trading firms having a well-establishment distribution network in the
country.

On January 15th,1999, the customs duties on sugar were increased to 20% and
valorem so as to protect the Indian sugar industry from excess supply though imports ,
but this has made little impact from Pakistan, which has raised subsidies for exports
and Brazil, which has devalued its currency.

To further discourage imports, Indian sugar companies are demanding an increase in;
duty to 50% as India is allowed to impose a maximum of 150% customs duty on agro
processed foods as per WTO. But the GOI is in hurry to increase customs duty as it
feels domestic sugar prices will increase in customs duty.

In the recent budget for 1999-2000, customs duty on sugar was marginally increased
to 25% as a process of rationalization of duty slabs in their tax systems, taking into
account the 10% across the board surcharge on all imports, the effective import duty
for sugar work out to be 27.5% ad-valorem plus a countervailing duty of Rs. 850 per
ton.

First SY 1998-99, imports are expected to be around O.S. million ton, But to protect
the interests of farmer in the period of high sugar production, the GOI is expected to
customs duty, leading to a drop in imports for SY 1999-2000 to 0.6 million ton and
0.4 million ton in SY 2000-01


___________________________________________________________

EXPORTS

The substantial increase in the volume of free international trade in sugar presents an
excellent opportunity to the Indian sugar industry to embark on a regular plan for
sugar exports. But the restrictive sugar; policies along with unstable sugar production
pattern make it an erratic trader on the world market.

In quick succession, India changes guard from the position of exporter of sugar to that
of an importer. To quote a recent example, sugar of O.S million ton SY 1991-92 and
SY 1992-93 was followed by import of 2mn ton in SY 1993-94 and 0.2 million ton
SY 1994-95. This was again followed by an export of I million ton in SY 1995-96 and
0.4 million ton is SY1996-97. This circle has been completed last year SY 1997-98)
with 0.94 million ton imports. The different up cursing period in India and other
major producers exporter like Brazil and Australia can be utilized to tap the export
marking in a big way. For the purpose of a comparison, the crushing season for
different sugarcane producing countries vis-à-vis India is as given in table no (3)

In demand-supply calculation projection, the exports are expected to increase from the
present level of 0.07 million ton to the earlier levels of around 0.1 million ton in SY
1999-2000 and 0.2 million ton in SY 2000-2001.

DEMAND SUPPLY

By estimating sugar cycle to top in season 1999-2000 by clocking a growth of 7%,
and then witness a drop in production for the season 2000-01. The closing stock will
come down to 3.3 million ton by September 30th 2001 form present level of 5.4
million ton by September 30th 1998.


___________________________________________________________

CHEMICALS DEPARTMENT

INTRODUCTION

Chemicals department is directly concerned with production. When the production is
on process, mixing proper quantity and proper chemicals is necessary. Chemicals
department is the production department.

IMPORTANT CHEMICALS

Lime and sulphur dioxide

CHART OF CHEMICAL DEPARTMENT

GENERAL MANAGER

CHIEF CHEMIST

CHEMIST MANUFACTURING SHIFT CHEMIST LAB CHEMIST

PAN MEN

CENTRIFUGAL OPERATORS


___________________________________________________________

ENGINEERING DEPARTMENT

INTRODUCTION

This department takes care of all the repairs-and maintenance units. The Chief
Engineer is the head of the department. Deputy Engineer and an instrumentation
engineer assist him.

The department is responsible for rectifying any breakdown machinery & equipment.

FUNCTIONS

 Maintenance of tools used in manufacturing process
 Maintenance of the plant and machinery.
 Providing technical service of the company.

CHART OF ENGINEERING DEPARTMENT

GENERAL MANAGER

CHIEF ENGINEER

INSTRUMENTATION
STORE DEPT DEPT.CH. ENGINEER WOKE SHOP ENGINEER

TRAINEE ENGR.

INSTRUMENTATION
TECHNICIANS

FITTERS

HELPER


___________________________________________________________

ELECTRICAL ENGINEERING DEPARTMENT

INTRODUCTION

This department takes care of all repairs and maintenance of fittings and fixtures of
the plant. The Senior Engineer is the head of the department. Assistant Electrical
engineer and junior engineers assist him.

ELECTRILCAL ENFINEERING DEPARTMENT

GENERAL MANAGER

SENIOR ELECTRICAL
ENGINEER

ASSISTANT
ENGINEER

SUPERVISORS

WORKMEN


___________________________________________________________

POWER PLANT

Power plant uses the fiber of processed sugarcane (basgass) as fuel to generate
electricity in an environment responsible manner.

An integrated 15 M W power plant generator and supplies electricity to the state grid
produced from sugarcane waste. Steam used to rotate turbines, 7WM power is utilized
within the plant, and remaining power is supplied to KPTGL.

CHART OF POWER PLANT

GENERAL MANAGER

HEAR POWER PLANT

ASSISTANT
ENGINEER

JUNIOR ENGINEER

BOILER OPERATORS


___________________________________________________________

DISTILLERY

Distillery plant was installed in the year 2002 at the same location,

Spirit produced at the distillery plant, Molasses is converted into rectified spirit.
Molasses is waste product form sugar juice. It is the byproduct in sugar industry.

Production of spirit is subject to control of excise department (Karnataka State
Government) the same department makes distribution and sale of spirit only.

Ethanol also subject to control of excise department, 0.55 Ethanol is used in petrol.


___________________________________________________________
CHART OF DISTILLERY PLANT

GENERAL MANAGER

DISTILLERY MANAGER

SHIFT CHEMIST SENIOR CHEMIST LAB CHEMIST

DISTILLERY
OPERATORS

HELPER


___________________________________________________________
PRICING POLICY

INTRODUCTION

Unlike other consumer goods, sugar cane will not be differing in
price, because it is subject to control of Government will fix the sugar price.

Price for export will be fixed by the firm. It is management’s policy
to fix the price.

Sugar Price

Sugar is a controlled commodity in India the essential commodities Act, 1995. Sugar
prices in the country can be classified into two broad categories at the user end as free
market prices and prices of sugar through public distribution system. The GOI
announces PDS sugar prices based on levy sugar prices fixed by it and the subsidy to
be provided through budgetary system.

The realization to sugar mills from government levy quota is called levy prices. Levy
prices are fixed by the GOI based on SMP for the year. But usually levy prices are
very low and fall below the cost of production. Therefore the producers are left with
only free sugar quota to run the business profitably.

GOI controls extend to free market prices also though the issue of monthly dispatch
orders to all the sugar mills and the country on demand supply situation in the
country.

In September IS1998, PDS sugar prices were increased from Rs.11.40 per kg to Rs.
12 per kg.

The sugar price range in the country for last few years is given below the sugar prices
move in close relation to production of sugar and the inventory in the country.

Sugar prices are the lowest in India when compared to the leading sugar consuming
countries in the world. Converted into India rupees the prices equivalent in


___________________________________________________________

Japan is of the order Rs.64.8 per kg
USA Rs 31.5 per kg
China Rs.25.78 per kg
Indonesia Rs. 18.62 per kg
Brazil and Pakistan Rs.17.9 per kg and
Sri Lanka, Thailand and Malaysia Rs.17.81per kg


___________________________________________________________

CHAPTER 5

SWOT ANALYSIS

STRENGTHS

 It is located in a place where good infrastructure is available.
 The company’s concentration towards the quality of the product.
 The technological standard of the company.
 Modern equipments.
 High production efficiency.
 Good sources of raw material.
 Power generation.
 Large supply of fertilizers and good quality seeds.
 Experienced labor force.


___________________________________________________________

WEAKNESSESS

 The company needs improvement and should concentrate on timely
customer services.
 Delay in payments.
 Labors turnovers.
 The promotion procedure in the organization is too rigid.
 The company has to focus more on sales. Marketing.
 No specific HRD department
 No scheme offers are given.


___________________________________________________________

OPPORTUNITIES

 Expansion of project like paper units, ethanol production, bio-fertilizers.
 All these above projects will give the company maximum profits.

THREATS

 Stiff competition from other sugar industries.
 Government intervention
 Production of sugarcane depends upon the rainy season.
 Substitute products.
 Crisis between managements and employees.


___________________________________________________________

CHAPTER 6

FINDINGS AND SUGGESTIONS

FINDINGS

 The company is making good profits this year as compared to last three years
and the company is expanding its business by increasing the installed capacity
to 600 TCD. And by another two units at Ajara and Mohan nagar on leased
basis.

 During the study it was found that the company is making huge profit
compared to previous years and equivalent amount of dividend is also declared
to the shareholder of the company.

 The computerization is not done fully.

 75% of the products produced by Chamundeshwari Sugar Ltd are sold.

 During the observation study we can found out that there are no safety
precautions followed in the organization especially in the production
department.


___________________________________________________________

SUGGESTIONS

 It is suggested that company need to be computerized fully to do the work
easily and economically.
 It should adopt strong marketing strategy.
 Safety measures like fire fighting, water facilities must be maintained.


___________________________________________________________
CONCLUSION

Chamundeswari Sugar Limited,(Lessee of H.S.S.K Ltd.,) has stated of art
equipment and Hilly competent technical team that produces one of the highest
quality sugars. It is growing very fast in the industry. It is dynamic achievement of
lady entrepreneur Mrs.Vidya.M.Murkaumbi.

Chamundeswari Sugar Limited,(Lessee of H.S.S.K Ltd.,) is not only
concentrating in production of quality of quality sugar, but also engaged in
developing new seeds which will be more suitable to the climate.

Irrigation planning by Chamundeswari Sugar Limited,(Lessee of H.S.S.K
Ltd.,) is appreciable, It arranges loans from banks for pipeline facilities fanner’s
fields. Lots of irrigation is being done under this scheme and repayment to banks in
made from the bill of concerned farmer.

Chamundeswari Sugar Limited,(Lessee of H.S.S.K Ltd.,) is agro based and
monsoon season hilts the production. This is the reason when sugar factories will be
closed because of inconvenience of harvesting and even transporting the cane factory
Indian sugar industry is highly fragmented with organization and unorganized
;players. The unorganized players mainly produce gur and khandsri, the less refined
form of sugar.

The company is very active in trading portfolio and second last merchant exporter in
FY 02-04 when the sugar was being exported. It is the largest raw sugar importer in
the current fiscal year. The company’s trade flow in sugar is largest its own
manufactured products.This leverages the company to understand to understand the
market and to play an active part in both domestic and international markets.

The company is the only one in the industry today with a formal risk
managements system in place. As a significant step forward in dedging own sugar


___________________________________________________________
price risk as well as that of customers, the company because an active corporate
member on NCDX dealing in sugar commodities to trade in spot market and in future.

It has a strategic relationship with one of the largest overseas players Tate and
Lyle plc, UK and continues its focus and plans to play an active role in global market.

With an able management and robust vision, Chamundeswari Sugar Limited,
(Lessee of H.S.S.K Ltd.,) today is one of the fastest growing manufactures in the
country.


___________________________________________________________
LEARNING EXPERIENCE GAINED BY THE
CANDIDATE DURING THE INPLANT TRAINING.

My overall experience in the company was very pleasant. The response and
support got from the management and staff was appreciable. I would like to mention
the name of MR.NARAYAN sir and who guided me in this project and who helped
me in the course of my in plant training. The atmosphere and working conditions
were encouraging in the company.
In plant training in the company helped me to know the practicalities. I learned
about management from the practical perspective and I learnt about organization as to
how it works in management aspects and the policies and procedures. Totally it was a
highly useful training for me in the company. This has added value in my academic
learning.
To conclude this project has given me practical exposure in the study of
organization. It was a dream come true for me who always wanted to work in the
industries which is my area of interest and it was a great experience working where I
learnt many things about the functioning of an organization in accordance with the
present market trends. The main purpose of the organization study is to make the
students acquainted with the practical knowledge about the overall functioning of the
organization. It given me the opportunity to study the human behavior and
also makes one ready to face different situations, which normally would come
across while on work in the office or factory environment

During the first week, it was totally a new experience entering into the
organization. On the first day of the training, senior assistant (HRD) detailed us very
clearly about the guidelines to be followed with respect to maintaining the discipline
of the organization.
After the initial session, they were taken to different departments and it was great
interaction with the various departmental heads and i came to know the real situation,
duties, responsibilities and functions of the departments. I visited the R & D

department, i came to know about the various tests undertaken by them to achieve
the desired level of quality.


___________________________________________________________
Each department has separate Manager, Deputy Manager, Purchase Officer,
Assistant Officer and Supervisor. It was really a fruitful and great experience while
working in the organization. Employees from every corner of the department
helped me in getting the required information for the successful completion of this
project. They cooperated well when we had to disturb them with so many queries in
our mind to be cleared from the concerned person during the visits to the respective
departments.
The atmosphere was so friendly and we did not feel any difficulty during the
whole training period of four weeks, which gave me a great deal information and
knowledge as to how an organization really functions


___________________________________________________________
BIBLIOGRAPHY

SL NO TITLE AUTHOR PUBLISHERS EDITION
Marketing Prentice - Hall of
1 Management Philip Kotler India Pvt Ltd. 2005
Human Tata Mc Graw-hill
Resource Publishing com.
2 Management K. Ashwathappa Ltd 2000
Research
3 Methodology C R Kothari Wishwa Prakashan 2nd edition

Website

• www.chamundeswarisugar.com
• www.google.com


___________________________________________________________
ANNEXURE
Balance sheet as on 2007-2008

Sl Expense Amount Sl Income Amount
NO. NO.
1 Opening stock. 1 Byproduct sales.
a. molasis. a) molasis 19979419.00
b. Sugar production 14951915.00 b) pressmud 164875.00
990000.00 15941915.70 c) Ash sales 26520.00
d) damaged bags 10000.00 20180814.00

2 Cane purchase a/c 143080357.00 2 Cane purchase 504739.00
3 Cane transportation 3866365.00 3 Closing stock.
a. Molasis 16132252.50
b. cane production 956250.00
17088502.50
4 560580.00 4 Production cost 178010552.25
5 Cane purchase tax 7733514.00
6 1546702.00
7 Production cost 43055144.00
Total 215784607.75 Total 215784607.75


Organization study at chamundeshwari sugar

More Related Content

What's hot

Similar to Organization study at chamundeshwari sugar

More from Projects Kart

Recently uploaded

In this document

Organization study at chamundeshwari sugar