A PROJECT REPORT ON “COMPREHENSIVE STUDY OF SALES & DISTRIBUTION CHANNEL” OF TRIVENI ENGINEERING & INDUSTRIES LTD. IN PARTIAL FULFILLMENT OF THE AWARD FOR MASTER OF BUSINESS ADMINISTRATION SUBMITTED TO: SUBMITTED BY: Prof. Vikas Saxena SACHIN KUMAR MBA-III Sem. Roll No.: 0903870042 1
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A
PROJECT REPORT
ON
“COMPREHENSIVE STUDY OF SALES & DISTRIBUTION CHANNEL”
OF
TRIVENI ENGINEERING & INDUSTRIES LTD.
IN PARTIAL FULFILLMENT OF THE AWARD FOR
MASTER OF BUSINESS ADMINISTRATION
SUBMITTED TO: SUBMITTED BY: Prof. Vikas Saxena SACHIN KUMAR
MBA-III Sem. Roll No.: 0903870042
INSTITUTE OF TECHNOLOGY & SCIENCE GHAZIABAD
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PREFACEModern organizations are highly complex and dynamics systems. They
operate under very turbulent social economic and political environment. They are
required to reconcile several incompatible goals. Conflicting roles and divergent
interest they are also fraught with the use risk and uncertainties, hence tactful
management of such organization to plan to execute guide, coordination and
control the performance of people to achieve predetermined goals. Management
has to keep the organization vibrant moving and in equilibrium. It has to achieve
goal which themselves are changing it is therefore a problem highly complex and
ticklish.
This information wil l be asset to market ing manager in
making effect ive decis ions. The researches are used to acquire and
analyze information and to make suggest ions to management as to
how market ing problems should be solved.
The market ing research is the process which l inks to
manufacturer , dealers and individuals through information in
important par t of curr iculum of M.B.A. programmers is project
taken by the s tudents in any business organizat ion, af ter
complet ion of second semester of the programme.
2
ACKNOWLEDGEMENT
Myself SACHIN KUMAR student of Institute technology & science Mohan nagar Ghaziabad ,underwent six-week training with Triveni Engg. & Industries ltd., KHATAULI. This is a part of MBA for which I had undergone practical training to understand exactly about the working of Triveni engg. & Industries ltd.
First of all I would like to thank Triveni engg. & Industries ltd.for its co-operation than I would express my gratitude to Mr.Ajay Tripathi (Sr. Manager-Godown) and Mr. Harish Grover (Sr. Manager- Quality Control) Triveni Engg. & Industries for accepting me as trainee and allowing me to do project under their supervision.
I express my gratitude to Prof. Vikas Saxena for their personal evolvement& support without which this project could never have been the light of this day.
Last but not the least, I acknowledge with thanks the active co-operation extended by all the respondents while collecting the data and to those who were concerned directly or indirectly with this project.
SACHIN KUMAR Institute Of Technology & Science Mohan Nagar, Ghaziabad
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Declaration
I, Sachin Kumar students of MBA III (Marketing ) 2009-11 studying at ITS, Mohan Nagar, Ghaziabad, declare that the project work entitled Sales and Distibution Channel of Triveni Engineering & Industries Ltd.was carried by me in the partial fulfillment of MBA program under the Uttar Pradesh Technical University Lucknow.
This project was undertaken as part of academic curriculum according to the university rules and norms and it has not commercial interest and motive. It is my original work. It is not submitted to any other organization for any other purpose.
Date: Sachin KumarPlace:Ghaziabad MBA III Sem
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INDEX
CHAPTER-I INTRODUCTION PAGE
PREFACE DECLARATION INDUSTRY PROFILE COMPANY PROFILE
CHAPTER- II DIVERCIFICATION PAGE
CO-GENERATION KHUSHALI BAZAR
CHAPTER – III BRANDED SUGAR – SHAGUN PAGE
CHAPTER- IV BY-PRODUCTS OF SUGAR PAGE
MOLASSES BAGASSE PRESS-MUD
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CHAPTER V RESEARCH & DEVELOPMENT PAGE
CHAPTER VI KEY STRENGTHS PAGE
CHAPTER VII FACT SHEET PAGE
CHAPTER VIII OBJECTIVES OF STUDY
RESEARCH METHODOLOGY
CHAPTER IX SALES AND DISTRIBUTION CHANNELS DATA ANALYSIS FINDINGS & CONCLUSION SUGGESTION QUESTIONAIRE
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CHAPTER – I
INTRODUCTION OF SUGAR INDUSTRY
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INDUSTRY PROFILE
We are a focused, innovative corporation having core competencies in the areas of sugar
and engineering. Our growth has been empowered with steadfast and distinctive
adherence to business ethics, transparent governance and commitment to highest
standards of social responsibility.
From a humble beginning in 1930s, we have transformed ourselves into an INR 19
billion company through an interesting blend of people, technology and entrepreneurial
spirit.
Today, we touch the lives of millions of people globally by serving our customers in the
areas of sugar, turbines, gears & gearboxes and water & wastewater treatment. While we
are amongst the three largest sugar manufacturers in India, we are also the market leaders
in our engineering businesses, having a global footprint.
Embracing the virtues of integrity, excellence and commitment, we move ahead to take
on the opportunities and challenges offered by the future. We are geared to transform
into a truly global enterprise through a prudent mix of technical innovation and
exceptional customer service delivery.
Our commitment to excellence and strong corporate governance guides us in this
endeavour, as we look ahead at powerful growth and building a socially equitable,
sustainable future.
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BUSINESS OVERVIEW;-
Triveni's association with the Sugar Industry is as old as the Industry itself. In pre
independence India, the promoters of what is now the Triveni Group established several
sugar factories in pre independent India. Even now, Triveni is the pre- eminent name in
the Indian sugar industry.
With a current cane crushing capacity of 61,000 TCD (Tonnes Crushing per Day), the
Triveni Group continues to be one of the largest producers of sugar in India. The crush
capacity of the existing plants are (as follows;
Khatauli, in District Muzaffarnagar (16,000 TCD)
Deoband in District Saharanpur (14,000 TCD)
Ramkola in District Kushinagar (6,500 TCD)
Sabitgarh in District Bulandshehar (7,000 TCD)
Chandanpur in District J P Nagar (6000 TCD)
Raninagal in District Moradabad (5500 TCD)
Milak Narainpur in District Rampur (6000 TCD)
The new capacities at Chandanpur, Raninagal & Milak Narainpur together with the
brownfield expansion at Ramkola were commissioned during the sugar season 2006-07.
All seven sugar factories are located in the state of Uttar Pradesh. In all the factories,
double suphitation process is followed for sugar production.
The sugar produced at Triveni's factories is direct consumption plantation
white low ICUMSA (an International method for determining colour value of sugar,
lower value means whiter sugar), bold grain sugar which commands premium in the
market. A lot of emphasis is placed on the quality control procedures an quality of sugar
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produced in the factories.
At all the factories, emphasis is on usage of energy efficient systems, modern technology
and R & D for better operations and for improved per hectare sugar output. As a result of
Triveni's tie up with Sugar Research International of Australia, the group factories have
access to modern equipments & process knowhow.
Khatauli, Deoband & Sabitgarh plants are located in fertile, well irrigated and high cane
intensity region of western Uttar Pradesh where the sugar cane crop is least dependent on
the vagaries of the Monsoon & therefore are very consistent in terms of the cane
availability & capacity utilization.
The Ramkola unit is located in lucrative eastern UP where the realization of
sugar (particularly because of the robust demand from sugar deficient West Bengal) is
better as compared to western UP.
The three new sugar units are located in the Central UP.
The cane development activities taken up by the factories are regarded to be amongst the
best in the industry. Group has been pioneer in using modern techniques like Satellite
tracking for getting information on area in its command for enabling decisions on which
variety to be propagated in which area. Factory has huge data base on individual farmer's
field data (total cane area, past supplies, ratoon and plant cane acreage, soil details, land
type details etc.) to take prudent decisions on cane development.
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MILESTONES :-
Since the setting up of first unit at Deoband in 1932, the overall performance of our
Sugar Business has been commendable. During the last two decades we have crossed
many milestones and are committed to cross many more in the future.
Following is a glimpse of our achievements during the last two decades:
1989
Awarded "Certificate of Merit" for best performance during season 1987-88 by National
Productivity Council of India. This award was presented by Hon'ble Shri J. Vengala Rao,
then Hon'ble Minister of Industries, Govt. of India and President of NPC.
1991
The Double Carbonation and Double Sulphitation process was converted successfully
into Double Sulphitation process having due consideration to Environmental problems.
1992
Successfully completed Expansion and Modernisation of the Plant from 5000 TCD to
10,000 TCD.
1998
Successfully completed the Expansion of the Plant from 10,000 TCD to 11,000 TCD.
2000
We exported 2.42 Lac. Qtls. of Sugar to Pakistan.
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2001
Launching of the Biological Control Lab. for Soil testing and developing of biological
pest control system for the benefits of the Cane Growers of the area.
2003
In August, 2003 launched Branded Sugar "Shagun" and started packing of consumer
packets.
2005
Launched "Triveni Kushali Bazaar" an Agri-business Centre at Village Ladpur near our
Sugar Unit mainly for making available agricultural implements & inputs and other
domestic items under one roof for the Cane Growers of the area.
2005
We crushed 186.61 lac. Qtls. of cane during season 2007-08 which was the highest crush
in India with highest production of 19.59 lac. Qtls. of Sugar.
Expansion of the Plant from 12,500 to 16,000 TCD by adding a new Milling Tandam
with complete automation system is being done which will commence production in
season 2008-09.
A new Co-generation plant of 24.0 M.W. is under installation which will commence
production in October, 2005.
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Product Quality
The commercial grading of sugar in India is based on grain size and colour categories.
Currently 3-grain sizes and 3 colour series are identified.
GRADE GRAIN SIZE
L > 1.70 – mm
M 1.18 - 1.70 mm
S 0.60 - 1.18 mm
COLOURAPPROX. ICUMSA COLOUR
UNITS
31 < 100
30 100-150
29 29 >150
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Khatauli Sugar Quality :-
In India bold grain carries a premium. Keeping this in mind, the Khatauli unit produces
sugar of bolder grain of low colour value. The production is categorised as following
(figures are approx. as they vary every year)-
L-31 20%
M-31 70%
S-31 10%
Sugar is statutorily required to be packed in 100 Kg twill jute bags
CANE DEVELOPMENT PROGRAM :-
Cane Development Programme
The philosophy of the cane development and marketing is almost common for all the
sugar units. While in following paragraphs, description is for Khatauli but applies
generally to Deoband & Ramkola units as well.
After identifying the constraints in the area of operation, the mill has undertaken an
ambitious programme of Cane Development for improvement in productivity and quality
of cane. The mill has separate cane development wing with qualified staff and
experienced personnel. For this purpose the operational area has been divided into sub-
zones and the field supervisory staff has been provided with the necessary facilities for
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efficient working and proper supervision of the various cane development activities.
The cane development programme is planned with following activities:-
To educate the farmers regarding modern agricultural practices in sugarcane
cultivation.
To replace the unapproved and degenerated cane varieties
To initiate and propagate the use of healthy and generically pure, seed material.
To initiate heat therapy for the treatment of cane seed through moist hot air
treatment plant to eliminate the diseases.
Fertilizers recommendation based on soil testing.
Supply of press mud on subsidized cost for improving the soil fertility.
Distribution of agro-chemicals on subsidized rates.
Incentive for high sugared varieties like CoS-88230, CoS-8436, CoJ- 64/85 and
CoS-88230 in the early group and CoS-8432, CoP-84212 in the mid and late
group.
Three tier seed nursery programme for multiplication of disease free good quality
seed.
Propagation of newly released high yielding and high sugared cane varieties.
Contribution of funds with cane development councils for construction/repairing
of link roads and culverts for the development of infrastructure.
To layout the demonstration/trial plots to demonstrate yield potential and
better/improved cultivation techniques.
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The details of various schemes of cane development being undertaken by mill are
enumerated as below:-
» Plantation of High Yield Variety of Sugarcane
» Seed Distribution
» Demonstration Plots
» Technical Assistance to Cane Growers
» Moist Hot Air Treatment
» Irrigation
» Ratoon Management
» Biological Laboratory
» Soil Analysis and Soil Treatment
» Control of Post Harvest Sugar Losses
» Awareness Among Cultivators
PLANT & MACHINARY INTRODUCTION :-
For Triveni, sugar to sugar plant & machinery was a natural diversification. Triveni
entered in this field in mid 60s and has been a major player in this business area of sugar
machinery & turnkey sugar plants.
This division has executed more than 35 sugar plants ranging from 1000 TCD - 10000
TCD capacity and carried out major expansion, balancing work for over 20 sugar
factories.
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The mills designed by Triveni are considered by experts to be very robust and rugged,
requires least maintenance and give higher mill extractions.
Triveni got out of the business of complete new sugar units installation as it started
focussing on niche technology and equipment available because of tie up with SRI, a
premier sugar research institute of Australia and industry turning to low cost small
players (at a time when sugar industry was going through bad phase) started eating away
the profits made by this division.
Now, Triveni SRI Limited (TSL), a Triveni Group Company, under a License Agreement
with Sugar Research International, offers the latest models of plants and machinery
available to the Australian industry to the Indian Sugar Industry.
COMPANY PROFILE :-
TEIL was incorporated in 1932 and has been managed by the Triveni Group, of which
Mr. Dhruv Sawhney is the key promoter. The promoters hold around 70% of the
company’s equity and have over four decades of experience in the sugar business. Apart
from its main business of sugar manufacture, TEIL is also engaged in the manufacture of
small steam turbines and high-speed gears, and in the execution of water treatment
related projects. TEIL is the third largest domestic sugar manufacturer with a combined
capacity of over 61,000 tonnes crushed per day (tcd). The company’s sugar mills are
located at Khatauli (16,000 tcd), Deoband (14,000 tcd), Sabitgarh (7,000 tcd),
Chandanpur (6,000 tcd), Raninagal (5,500 tcd), and Narayanpur (6,000 tcd), all in
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western UP, and at Ramkola (6,500 tcd) in eastern UP. Apart from these, TEIL also has a
46 MW co-generation capacity at its Khatauli sugar mill, a 22 MW cogeneration capacity
at its Deoband sugar mill, and a 160 kilo litres per day (klpd) distillery at Muzaffarnagar
UP. The company’s sugar business, including the co generation and distillery facilities,
is the largest among its businesses in terms of revenues and capital employed.
TEIL’s steam turbine division, which is in Bangalore, is its second largest
division in terms of revenues and capital employed. This division manufactures steam
turbines of less than 18 MW size, and has recently started making turbines in higher MW
segments of up to 30 MW. TEIL also has a high-speed gears division in Mysore,
Karnataka,and a water projects division at Noida, UP. While the high-speed gears
division supplies gears to the steam turbine division and to other industries and utilities,
the water project division offers engineered-to-order mechanical equipment relating to
water/waste water treatment. Although these divisions account for a relatively small
portion of TEIL’s revenues, profits and capital employed, the recent growth in them has
been significant.
TEIL’s sugar (including co-generation) and turbines divisions have remained the
main contributors to the overall turnover and profits of the company , together accounting
for over 90% of the company’s turnover and profits. However, the contributions have
varied significantly over the last few years because of the cyclicality in the sugar
business.
TEIL’s sugar and allied businesses account for almost 80% (around Rs. 15
billion) of the total capital employed, and the turbine division for just around 10%. For
the 15 months ended June 2007, TEIL reported a PBIT of Rs 1.26 billion, contributed
largely by its engineering businesses.
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VISION
Have leadership position
In each of our businesses
Create value and delight for
Our customer and stakeholders
Incorporate technology as the key
Differentiator and tool to deliver growth
And sustain our position of leadership
CORE VALUES
CUSTOMER FOCUS
ORGANISATIONAL PRIDE
MUTUAL RESPECT AND TRUST
INITIATIVE AND SPEED
TOTAL QUALITY
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KHATAULI PLANT – AT A GLANEC
Triveni sugar factory at Khatauli began operations in 1933. The cane crushing then was 100 tones per day. Through Constant investment in modern plant and machinery, and through regular technology up gradation, the khatauli plant can now crush 16000 tones of cane per day. The cane itself comes from the area of 1,50,000 acres. The technical Efficiencies achieved by the plant are one of the best in the state.
Khatauli Sugar Quality
In India bold grain carries a premium. Keeping this in mind, the Khatauli unit produces sugar of bolder grain of low color value. The production is categorized as following (figures are approx. as they vary every year)-
L-31 20%
M-31 70%
S-31 10%
Sugar is statutorily required to be packed in 100 Kg twill jute bags.
Triveni is pre-eminent name in the sugar industry. With a presence in the key field of energy – oil & gas and power Triveni, Probably, offers the widest range in medium size power generation capacity with steam, gas and hydel turbines.
The Following diagram Show the service offered by triveni group at khatauli plant is as follows:
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Sugar Businesses:
Sugar Manufacturing: Triveni plans to expand its sugar manufacturing capacity to around 52,000 tons of sugarcane crushed per day (tcd) in fiscal 2006-07. This expansion will include three new sugar factories with capacities ranging between 5000 to 7000 tcd. All the three factories will be located in West Uttar Pradesh, allowing the company to operate in a well irrigated cane growing areas with close access to sugar deficient markets. The company is also expanding its sugarcane crushing capacities at its factories in Deoband and Khatauli. The expansions in capacity and one new sugar factory (at Sabitgarh, district Bulandsher) will be operational within the financial year 2008-09.
Cogeneration of Power: Triveni currently produces 74MW of power for export to the UP State grid through its cogeneration facility at Deoband. The company is installing another 47MW cogeneration facility at Khatauli by September 2005. Therefore the total co generated power produced by Triveni, for export, will equal 45M
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Engineering Businesses:
Turbines: Triveni will double its capacity to manufacture turbines by March 2006. It will also expand the capacity output of its range of turbines and focus on exports.
Gears & Gearboxes: The gears business has expanded its production capacity three fold and is actively pursuing export opportunities through its License partner - Lufkin.
Water & Wastewater Treatment: The water business is pursuing strategic alliances with various business units of US Filter to expand its already diverse product portfolio.
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PROCESS FLOW DIAGRAM
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GLOBAL CONSUMPTION
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MANAGEMENT:-
Management - Triveni Engg
Name Designation
Dhruv M Sawhney Chairman and Managing director
Nikhil Sawhney Executive Director
K K Hazari Director
M K Daga Director
Shekhar Datta Director
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CHAPTER – II
DIVERSIFICATION
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CO-GENERATION
We have co-generation plants in Deoband and Khatauli that are located in Western Uttar Pradesh ("Co-generation Business"). In a sugar mill, bagasse, which is a by-product, is used for production of electricity and steam through a co-generation plant. Co-generation plants are used to produce two forms of useful energy simultaneously i.e. electric power and steam, with the surplus electric power being supplied to the power distribution company (ies). While we have had captive power plants in our sugar mills for a number of years, we started the co-generation of electricity with the commissioning of the new co-generating plant in Deoband on December 5, 2004. This facility has a capacity of 22.0 MW and the surplus electric power is being supplied to Uttar Pradesh Power Corporation Limited ("UPPCL") under a power purchase agreement for a period of 10 years.
In fiscal 2005, the revenue net of excise duty generated from co-generation was Rs.188.04 million, which was 1.95% of our total revenue net of excise duty and the profit before tax was Rs. 32.88 million, which was 2.65% of our total profit before tax.
CO-GENERATION FACILITIES- KHATAULIHaving gained experience in cogeneration in one sugar unit, Triveni decided to put up a similar co-gen plant at its largest crushing capacity sugar unit at Khatauli. The cogeneration project at Khatauli at present is under execution and expected to be completed by 1st of September 2005 to match with the expansion of the crushing capacity of Khatauli unit to 16,000 TCD. The capacity of the cogeneration plant is 47 MW.
Triveni has already entered into a PPA with UPPCL for the export of power from it's Khatauli unit. The plant & machinery of the cogeneration plant at Khatauli consists of the following:
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120 tph 87 ata/515 degree C high pressure/temperature boiler 47 MW double extraction condensing type TG set All auxiliaries (Includes cooling towers, water treatment plant, fuel & ash
After providing for certain captive requirements of the sugar factory and auxiliary requirements of the cog-en plant, this project shall export power to the grid to the extent of 17.00 MW in season (approximately 185 days) and 20.00 MW in off season (approximately 133 days).
At Khatauli, the water treatment plant is based on imported CEDI (Continuous Electro De -Ionization) technology and first in India to use such a sophisticated state of the art system for water treatment in a bagasse based co-gen plant
CO-GENERATION- Future Initiative
Triveni has decided to continue to expand its cogeneration business in next few years to come. This will see addition in capacities of power generation and exportable power to the grid. The power generation facilities shall continue to be world class with focus on usage of the world's best, most modern system for maximizing power generation and export.
The cogeneration plants shall also be a key driver in achievement of lowest per kg energy (steam & power) usage in sugar production in our units for which major plans for implementation are already underway. This will maximize the export of power to the grid.
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TRIVENI KHUSHALI BAZAAR
Triveni Engineering & Industries Limited has a command area of over 1 lakh ha.under sugarcane cultivation, covering over 1.46 lakh farmers and buys more than Rs. 300 Crore of sugarcane per annum from these farmers.
We have a team of over 250 staff in the Cane development who work closely with these farmers. We are now leveraging our longstanding relationship with these farmers to provide them with the entire range of Agri inputs and services under one shop called Triveni Khushali Bazaar.
Triveni Khushali Bazaar will increase the association of rural communities with us and further strengthen their relationship with us. Such a relationship, coupled with our track record of timely payment to farmers will enable us to secure the source of our primary raw material.
TRIVENI KHUSHALI BAZAAR-Future Initiative
Currently Khushali Bazaar has 2 Triveni owned stores and 4 franchise owned stores. The self owned stores are at Khatauli and Deoband. The franchises are at Jansath, Sisauli, Ghatain and Badgaon. These stores are operating since February 2005.
These stores will provide to farmers, Agri inputs, Agri implements for sale as well as rental, Irrigation equipment, Agri extension services, Cement, Cattle feed, FMCG, Petrol/Diesel, Lubricants, Two wheelers, Tractors and other goods to complete the farmers' basket of goods. We have established tie-up with a number of leading companies to sell their products through our stores. We have also tied up a bank to provide loans to our sugarcane farmers to facilitate their shopping in our stores.
After stabilising the operations at these stores, we would like to expand our network to other parts of UP.
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CHAPTER – I
BRANDED SUGAR
SHAGUN
30
BRANDED SUGAR- SHAGUN
on 26 September 2003 Triveni launched its 1kg & 5kg packets of sugar under the brand
name of SHAGUN
Shagun is a premium quality sugar from Triveni, a pioneer in the
Indian sugar industry since 1932. It stands for pure, healthy,
superior quality crystal sugar, which is manufactured using the
best technology from UK & USA, by crushing the juiciest
sugarcane from the Ganga-Jamuna Doab region.
The production of Shagun sugar takes place in a completely
hands-free and sterile environment. We also deploy double micro
filtration system that removes minutest foreign particles to make
the sugar pure & healthy.
Objective of branding:-
To get closer to end consumer and provide them with a value added product.
The Sugar mill produces many by-products along with sugar. A typical sugarcane complex of 3000 tcd capacity can produce 345 ton of sugar, 6000 liters of alcohol, 3 ton of yeast, 15 ton of potash fertilizer, 25 ton of pulp, 15 ton of wax, 150 ton of press-mud fertilizer and 750KW of power from bagasse.
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Sugar factories world over has successfully pursued the route of value addition to by – products for improving their financial health. Indian sugar industry would do well to adopt the same route in the interest of achieving long-term sustainability.
Bagasse & molasses are two most important by – products of the sugar industry
MolassesMolasses is the final effluent obtained in the preparation of sugar by repeated crystallization. It is the end product from a refining process carried out to yield sugar. Sucrose and invert sugars constitute a major portion (40 to 60%) of molasses.
Use of Molasses
Molasses is used in Distillery to produce Alcohol and then further chemicals and also for cattle feed.
Definition of Molasses
i. Molasses means the heavy, dark colored viscous liquid produced in the final stage of manufacture of sugar by vacuum pans, from sugarcane or gur, when the liquid as such or in and form admixture contains sugar.
ii. Molasses means the mother liquor produced in the final stage of manufacture of sugar by the vacuum pan process for sugarcane and gur.
iii. Molasses is the final liquor in the process of sugar manufacturing from which no more sucrose can be crystallized and recovered with the physical means as applied in a sugar mill. The product is technically called as final molasses or exhaust molasses.
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Molasses Specification
General composition of molasses as follows:
1.Solids.
2.Sucrose and reducing sugars.
General Composition
Sucrose 30 - 35 %
Reducing Sugar 10 - 15 %
Ash 10 - 12 %
Total Sugar % dry solids 55 - 60 %
Nitrogen 0.15 to 0.25 %
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Gums 0.05 to 3.5 %
CaO 1.0 to 1.5
So4 1.2 to 3.5
P2O5 0.25 to 0.30
PH 5.4 to 5.7
Total organic non-sugar 15 - 20
Unfermentable reducing matter 1.5 to 2.5
Categorization of Molasses
Molasses is categorized by the total of fermentable sugar content, commercially known as TRS (Total reducing sugar) on the basis of which, the categories are as under:
Grade %age of Total sugar contents of molasses
(Expressed as reducing sugar)
I 50.00 % and above
II 44.00 – 49.99 %
III 40.00 – 43.99 %
Below grade below 40 %
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Testing Parameters
In commercial practice the molasses is tested for the Brix (Total Dissolved solid) and TRS (Total reducing sugars), which represent its quality and grades for sale.
Capacity of Molasses in all tanks at Khatauli
Tank No
Tank capacity
No 1 19000
No. 2 19000
No.3 22000
No 4 48000
No 5 80000
No 6 100000
No 7 60000
TOTAL 348000
Molasses is used for production of rectified spirit, which is used as as feedstock for production of chemicals as well as potable liquor. The country has been producing about 1.7 billion liters of alcohol utilizing 75-80% molasses production in the country. The surplus molasses is either exported or carried forward to the next sugar season resulting in quality deterioration.
Technology in the country has developed scheme for utilization of molasses for production of alcohol and down the line alcohol based chemicals. Alcohol industry has an installed capacity of 2700 million liters per annum and the production is of the order of 1300 million liters. Major part of the alcohol produced in the country is utilized for production of alcohol based chemicals and some part is used for production of alcohol-based chemicals and some part is used for potable and pharmaceutical industries. The current level of consumption is 1200 to 1300 millions liters and as such the capacity of the industry remains unutilized and the industry is faced with the glut of molasses, in the last season it was reported that molasses were to be disposed off more or less free. One of the constraints in
38
utilization of the molasses has been the movement of alcohol and restrictive alcohol polices as well as restrictive policies in respect of allocation of molasses.
Government is now thinking in terms of promotion the use of alcohol as an additive to petrol and some committees appointed by the Government are reported to be working out the modalities thereof. Faced with the situation of excessive molasses and alcohol the Government has recently permitted exports, which are picking up.
In U.P. Current policy is 10% for making country liquor and 90% is other bonafide users like chemicals plant and industrial chemicals. In U.P. Molasses is mainly being used for production of Alcohol, liquor and organic chemicals.
India now claims to have the largest chemical industry in the world using sugar cane molasses as fed stock. Alcohol based Acetaldehyde, Acetic acid poly vinyl chloride (PVC) and Molasses is producing Mono Ethylene Glycol (MEG) etc. only. Elsewhere these are produced via Petro Chemicals route. India thus contributes to minimization of the Green House effect Plans are also being made to use Ethanol as blend for motor fuel.
Bagasse
Bagasse is another by-product of the sugar industry, which constitutes about 30% of cane processed for production of sugar, is used as fuel for generation of steam and power to meet the process requirements. The potential of sugar cane for Power Production besides sugar has been estimated at 120 KWH per tones.
In India the exploitation is yet at a very low level. Generally the power generation is for captive use at about 25-30 uni Bagasse is a fibrous residue of cane stalk that is obtained after crushing and extraction of juice.
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It consists of water, fiber and relatively small quantities of soluble solids. The composition of bagasse varies based on the variety of sugarcane, maturity of cane, method of harvesting and the efficiency of the sugar mill.
The usual bagasse composition is given below.
Content Range %
Moisture 46-52
Fiber 43-52
Soluble solids 2-6
Bagasse is usually used as a combustible in the furnaces to produce steam that in turn is used to generate power. It is also used as raw material for production of paper and as feedstock.
On Country scale the power export potential of sugar mills is being estimated at over 3500 MW, which it harnessed, could be a substantial supplement in the deficient power situation.
Considerations of power shortage, need for harnessing the non-conventional energy sources and the concept of ultimate dependence on Agriculturally renewable sources, in view of depletion of fossil fuels and the impact of their use on the environment and CO2 balance have generated global interest in the subject. Sugar Mills of course are the appropriate focal points due to Bagasse.
It will not be out of place to mention that 45% factories in the country are working with fuel consumption below 30% bagasse on cane and that more than 60 % factories are booking fuel consumption of above 36% bagasse on cane. Bagasse can be used as raw material for the manufacture of paper, fulfural etc. The Forest Research Institute (FRI) at Dehradun worked out a project for the manufacture of insulation board, straw board, practical board, furniture, rough paper, bag paper high Alfa cellose pulps, grease proof paper, pules and newsprint paper etc. from bagasse. In spite of all this there has been little progress towards utilization of bagasse in areas other than fuel. R & D units at factory level can take up further work in co-ordination with Central Research Agencies.
40
Bagasse is partly used by the Sugar Mills for fuel to generate steam and power for captive use. Several factories manufacturing paper are utilizing the same bagasse and other fiber based products and wood substitutes. Recently the idea of co-generation production of power is being encouraged and the industry’s potential for production of power has been assessed at 3000 MW, which can do a substantial contribution to deficit power position in the country. With growing consciousness about the environment there is a realization that the generation of power through agricultural residues like bagasse will help the conservation of ecological balances to contain the global warming.
Co-generated power apart from being a renewable source of energy is also most eco-friendly. The Government of India has a vision plan to increase the share of renewable energy to 10% by the year 2010.
Paper Industry generally uses bagasse. Paper Industry use bagasse for making paper out of it. In Sugar Industry, bagasse is also an important part on account of funds generation. In the current scenario every sugar mill is going to set up a co-generation plant for cost viability.
It is used for generation of steam & power required for processing of sugarcane. With energy saving around 5 to 10% of bagasse is saved by a majority of units and is utilized for production of sugar and in some cases cogeneration of power.
The following table indicates the usage of bagasse for paper and possible production of paper estimated by the development council for pulp& paper by the year ending 2015-2016.
41
Year Forest based Mill wet Straws waste total pro- Raw material bagasse paper duction
sugar mills have been successful in reducing dependence on state electric board's for power supply. For example, Ballarampur Chini Mills procured 95% of its total power requirement for FY98 from captive generation from steam turbines.
Press-Mud (Filter Cake)
The filter cake of sulphitation factories is used as manure. Work was done at National Sugar Institute up to pilot plant scale to produce crude and refined wax from this. These R&D units can take further feasibility studies for semi-commercial scale application.
Press Mud, which was considered a waste by Sugar Industry, is now being increasingly utilized for production of Bio Manure to substitute at least partly the chemical fertilizers. Several units are already in commercial production. Technology has also been developed for production of Fuel Gas from the Press Mud. We hope in near future the Press Mud will become even more valuable by-product.
Press-Mud is waste-product of the sugar industry, which constitutes about 4% of cane processed for production of sugar, is used as fuel by bricks manufacturer and by farmers as fertilizer.
Press Mud is a waste generated out of the total cane crushed. Sugar Mill has to make special efforts for keeping and disposal of the Press Mud. Some time when accumulation of Press Mud takes place, sugar mill has to stop the cane crushing operations during peak season. The disposal of Press Mud is very much specific. Press Mud can be used only either as fertilizers in the farmer’s fields. Or for burning purpose with the bricks manufactures. Why it is used for burning purpose, in press mud sugar contents are inside it helps in burning purpose.
42
CHAPTER – IV
RESEARCH
&
DEVELOPMENT
RESEARCH & DEVELOPMENT
43
Triveni turbine business group derives its technological source from various
international collaborations.
Our R&D and Engineering team has 25-30 years rich experience in steam
turbine designs.
Combination of extensive design experience with state of the art design tools
helps us in developing the latest designs of critical components such as
rotors, blades, nozzles etc.
To be distinguished global player, we have strong liaison with top notch
Indian and International specialists and association with premier institutes
such as Indian Institute of Science, Bangalore, IIT Madras, National
Aeronautical Laboratory, Bangalore, Gas Turbine Research & Engineering,
Bangalore etc.
In last 5 years, new designs are brought out by R&D in line with market
demand and put to operation successfully with excellent field performance.
Flow path components with higher efficiency and reliability were introduced
in the turbine models.
Design was made to have flatter efficiency curve over a wide range of
operation making it ideal for industrial applications.
Triveni TBG R&D and Engineering department is equipped with state of the
art soft wares in CFD, FEA, Solid modeling, rotary system analysis.
The sugar industry in India is highly fragmented with over 500 sugar factories. We
are amongst the three largest producers of sugar in India based on sugar production
in Sugar Year 2003-2004 derived from ISMA Working Results of Sugar Factories
in India, 2003-2004. We manufactured 0.38 million tones of sugar in the Sugar
Year 2005.
Strong Financial Position
We have a strong financial position, which we believe will enable us to finance our
capacity expansion plans. As of March 31, 2005, we had a long-term debt to equity
ratio of 0.72: 1 and total debt to equity ratio of 2.74:1. In fiscal 2005, we have net
Strategic Location of Mills
All of our manufacturing facilities for sugar production are located in the north
Indian state of Uttar Pradesh and the two largest sugar mills at Khatauli and
Deoband are located in western Uttar Pradesh, which is one of the largest
sugarcane growing areas in India. As a result of our presence in the state of Uttar
Pradesh, we benefit from the following advantages.
Proximity of Sugarcane Deficient Markets
47
Our sugar mills are located close to the sugarcane deficient markets of Punjab, Haryana, Delhi, Madhya Pradesh, Rajasthan, Gujarat and West Bengal. Thus, our primary markets are located close to our manufacturing facilities and we do not rely on transporting our sugar to distant markets, which gives us a comparative advantage in distribution costs of this bulk commodity.
Excellent Relationships with FarmersWe make timely payments to sugarcane farmers and have built excellent relationships and goodwill with them, which is an important factor in our industry. We have a good record of payments to farmers for sugarcane despite the cyclical nature of the sugar industry and have strong ties with approximately 167,000 sugarcane farmers.
Extensive Network for Sugarcane CollectionIn order to facilitate the sale of sugarcane to us by the sugarcane farmers, we have established a extensive network of more than 350 collection centers in the state of Uttar Pradesh, where the sugarcane is collected by us and payments are made to farmers. These collection centers are located in our sugarcane area and hence, the farmer is not required to bring his crop to our factory gates.
Good Product Quality
The sugar produced by our sugar mills in Khatauli and Deoband is bold grained and is rated as one of the better qualities of sugar produced in western Uttar Pradesh. This enables us to command a premium on the sugar produced by us.
48
CHAPTER – IV
FACT SHEET
FACT SHEET
In India we are the first company to rise to superlatives in many areas of our
49
operations. Given below is a glimpse:
1988 Completion of the largest Wastewater Treatment Plant in India, of 182 MLD capacity constructed on turnkey basis for Vizag Steel Plant
1989 Awarded "Certificate of Merit" for best performance during season 1987-88 by National Productivity Council of India. Hon’ble Shri J. Vengala Rao, then Hon’ble Minister of Industries, Govt. of India and President of NPC presented this award.
1994 Gear Manufacturing Unit becomes the first to be ISO-9001 Certified in India.
1999 Completion of the largest Oil Water Separation system for Reliance Petroleum, Jamnagar.
2000 We exported 2.42 Lac. Qtls. of Sugar to Pakistan. Pioneered joint manufacturing concept for gearboxes -supplied 25 MW retrofit supply to L and T, Awarpur as replacement to Renk Germany.
2002 BPR initiatives - Complete system on SAP, BPR by Accenture.
2003 Gear Box Unit reaches 5000 mark of dispatch of gearbox/gear set.
2005 We crushed 186.61 lac. Qtls. of cane during season 2007-08 which was the highest crush in India with highest production of 19.59 lac. Qtls. of Sugar.Secured first ever-Indian order for CEDI based Boiler Feed Water Treatment Plant of 85 M3/Hr. capacity for Khatauli Co-gen Plant. First vertical roller mill gearbox of 70 tons - supplied as indigenous replacement to Flender Bocholt - Germany to cement industry.
50
CHAPTER – V
SOCIAL RESPONSIBILITY
51
SOCIAL RESPONSIBILITY
TRIVENI fulfilled the social responsibility by taking initiative for protecting the environment in the following ways –
Harmony between man and environment is the essence of healthy life and growth. Therefore, maintenance of ecological balance and a pristine environment has been of utmost importance to TRIVENI.
Environment protection continues to be a key area of activity in TRIVENI along with growth in generation of power. Driven by its commitment for sustainable growth of, TRIVENI has evolved a well defined environment management policy for minimizing environmental impact arising out of setting up of power & Sugar plants and preserving the natural ecology.
"TRIVENI has its Environment Policy and Environment Management System". Amongst the guiding principles, adopted in the document, are the company's proactive approach to environment, optimum utilization of equipment, adoption of latest technologies and continual environment improvement. The policy also envisages efficient utilization of resources, thereby minimizing waste, maximizing ash utilization and providing green belt all around the plant for maintaining ecological balance
TRIVENI's environment-friendly approach to power has already begun to show results in conservation of natural resources such as water and fuel (coal, oil & gas) as well as control of environmental pollution. NTPC has chalked out a set of well-defined activities that are envisaged right from the project conceptualization stage.
TRIVENI's environment-friendly approach to power has already begun to show results in conservation of natural resources such as water and fuel (coal, oil & gas) as well as Control of environmental pollution. NTPC has chalked out a set of well-defined activities that are envisaged right from the project conceptualization stage.
52
Performance enhancement and up gradation measures are undertaken by the organization during the post-operational stage of the stations. These activities have
Greatly help greatly helped to minimize the impact on environment and preserve the ecology in and around its power projects. These measures have been enumerated as follows.
53
CHAPTER – VIII
INTRODUCTION OF TOPIC
OBJECTIVES OF THE STUDY
54
Basical ly the object ive of the s tudy was two fold, on the
researchers par t , i t was gain a pract ical exposure of the
management theories in the f ie ld of market ing with the combined
aim of get t ing two years MASTER OF BUISNESS
ADMINISTRATION (MBA) degree.
On the companies par t the object ive was “ STUDY OF SALES &
DISTRIBUTION CHANNEL OF TRIVENI GROUPS” which includes
To understand the distribution channels of triveni
To understand the sale of branded sugar
To understand the consumer preference
To understand the consumer awareness about “shagun”
55
RESEARCH METHODOLOGY
Methodology, for a s tudy l ike this is the most important par t . The
method of s tudy adopted by me is tota l ly is to increase & to gather
the more information regarding this project .
The major emphasis in such s tudies is on the discovery of the
ideas & frui t ful re levant information. As such the research design
appropriate for such s tudies must be f lexible enough to provide
opportuni ty for considering different aspects of a problem under
s tudy.
METHODS OF DATA COLLECTION :
PRIMARY DATA:
Survey method -- This method was adopted because i t helped in
securing detai l information from a sample of respondents . The
information received from the respondents is recorded on a form
cal led the quest ionnaire . This is only method to measure a t t i tude
& motivat ion direct ly .
Open framed discussion with managers .
56
SECONDARY DATA :
I have also used the secondary data , which included the wri t ten
document of the organizat ion & other places .
1. INTERNET
2. PAPERS & RECORDS
The data col lected from the above mentioned sources helped me in
get t ing information about the br ief his tory t r iveni .
57
Khatauli unit has the capacity of sugarcane crushing is 8500 tcd in 2007-08 and
11400 tcd in 2008-09 and wanted to expend this to 16000 tcd in 2006-07.
Triveni produces two type of Sugar.
1. White Sugar
2. Branded Sugar
White Sugar:
Triveni produces plantation white sugar through the double sulphitation process. Sugar accounted for 70 % of the Company’s revenue in 2008-09. The company posses the capacity of 40,500 tcd spreads across its Khatauli, Deoband, Ramkola and Sabitgarh units.
The company expects cane supply to be based on mill’s capacity and
therefore expects cane allocation to be increased from the 2010-11-sugar season.
58
Branded Sugar:
The Company’s branded sugar is manufactured in Khatauli and marketed under the
Shagun Brand. During the year under review, the off take of Branded sugar
increased by 44 % to 6522 MT. While the market of branded sugar is not large,
demand is increasing due to increased urbanization and life style changes.
SUGAR PRICING
After the production of sugar, company sale their sugar. All sugar is taking
place through agents and Banks. The Indian Government follows a dual pricing
policy, under which a fixed proportion of production is to be sold by the sugar
companies to the public distribution system at a fixed price (Levy Sugar). This
price varies from region to region and the sugar directorate (under the ministry of
consumer affairs, Food and Public distribution) releases this quantity in favor of
the various states.
Interestingly, there has been a decline in sales through the Public Distribution System as the Levy sugar has declined from 60 per cent in the early 1980s to 10 percent effective from March 2002 (according to the government’s Revitalization Report). The balance of sugar (free sugar) can be sold in the open market, is not subject to the Levy, the government continuous to regulate sales through a release mechanism, determining the amount of sugar that can be sold each month.
59
A turnaround in free sale sugar realizations commenced in February 2004,
with subsequent increases in May 2004 and January 2005 (Indian Sugar Mills
Association data). Triveni’s realizations were higher than the all India average due
to a combination of regional, quality, colour and crystal size factors.
On average, domestic sugar prices strengthened in 2007-08 and demand-supply
forecasts indicate that they could remain firm over the coming two years.
Ex-Factory Prices of Free Sale Realizations:
(Rs/MT/sugar) 2005-06 2006-07 2007-08
October 11600 11290 14710
November 11140 12030 14650
December 10810 11770 15360
January 10710 11660 16630
February 10660 12930 16530
March 10540 12770 16500
April 10650 13420 16640
May 10580 13990 16650
June 10810 14220 16620
July 11810 14060 16710
60
August 12590 14650 17110
September 12340 14720 17010
Average 11190 13210 16260
India’s Sugar Import Policy:
The upturn in India’s sugar cycle is a direct result of the forward-looking policies
of the Ministry Of Food, Government of India. There have been instances in the
past when a sugar shortage in India was followed by a reductions in customs tariff,
allowing an enormous quantity of white sugar to flood the market and trigger a
steep fall in sugar prices. This time the government permitted only the import of
raw sugar-by-sugar factories- not traders- with an export obligation under the
Advance License Scheme, one of a number of policies to ensure long-term price
stability, given the temporary imbalance between production and consumption.
In 2007-08, government policies ensured that sugar prices remained at
reasonable levels, which improved industry viability and resulted in a record,
timely and even nationwide sugarcane planting and will translate into higher
output, notwithstanding a lower-than-average monsoon.
Act, 1955, the ex-factory prices of levy sugar are determined each year by the
Ministry of Food and Civil Supplies, Government of India. The current ratio of
free-to-levy sugar is 90:10 i.e. 10 per cent of the sugar produced is to be sold at
prices fixed by the Government for different levy price zones in the country. Every
month, a fixed quantity is released to each factory in respect of specified buyers
nominated by the Central Government. In U.P., there are three levy price zones:
while the Khatuli and Deoband factories figure in the Western U.P. price zones,
Ramkola figures in the Eastern U.P. price zones. The levy price for West U.P. was
Rs 1275.92 per quintal and Rs 1383.41 per Quintal for East U.P.
Statutory Minimum Sugarcane Price (SMP):
This price is determined by the Central Government on the basis of Clause 3
of the Sugarcane (control) Order, 1966 with respect to each sugar season. The
Government fixes the price considering the recommendations by the Commission
for Agriculture Costs and Prices. The SMP for 2007-08 seasons was fixed at Rs.
74.50 per quintal corresponding to a base recovery of 8.5 percent. The previous
season’s average recovery for each sugar unit was used to determine what SMP
payment needed to be made by each factory, calculated on the basis of Rs 0.88 per
quintal for an every 0.1 per cent increase in recovery over 8.5 per cent. The SMP
for Khatauli, Deoband and Ramkola units were fixed at Rs 89.46 per quintal, Rs
92.10 per quintal and Rs 87.70 per quintal respectively.
For the purpose of extra sugarcane payments to growers above the SMP, a formula
of sharing sugar realizations with the growers has been prescribed under Sugarcane
Control Order, 1966.after the ‘L’ factor (representing the cost of production) based
62
on the SMP is announced by the Government (which invariably comes some two
or three years later), the cost based on the ‘L’ factor is subtracted from the actual
realization of sugar; 50 per cent of this extra amount is shared with growers. In
reality, factories in U.P. invariably pay much more than what is arranted by this
formula as State Advised sugarcane Prices (SAP) announced by the U.P.
government are higher than the 50 per cent sharing payable.
State Advised Price: A majority judgment of the Supreme Court dated 5 May 2004 held that the
State Government in U.P., in exercise of its regulatory power as contained in the
U.P. Sugarcane (Regulation of Supply and Purchase) Act 1953, could fix the price
of sugarcane. A review petition field by ISMA, highlighting the inconsistencies
with an earlier unanimous decision of a five-judge bench of the Supreme Court of
1956 in Ch. Tikaramji’s case, and other specific constitutional points, was turned
down. The U.P. Government announced an SAP higher than that paid by the
industry in 1996-97, 2005-06 and 2006-07. on a demand made by the sugarcane
societies and the U.P. Government, Triveni made all these payments for its three
sugar units under protest, making it one of a handful of such factories in U.P. to
have done so.
U.P. Government Sugar Policy:
To encourage investment in the sugar industry, the U.P. Government
announced Sugar Industry Incentive Policy 2004 during the year under review. It
spelt out the following:
63
The sugar industry as the most important industry in the state and sugarcane as
its principal cash crop, supporting the livelihoods of 3.2 mn farmer families and a
labour force of 160000 directly or indirectly in the state.
The industry’s position as a driver of social and economic growth in the
locations of its presence.
The identification of various ancillary or downstream industries like sugar
machinery, distilleries, electricity co-generation, ethanol and bio-fertilizers as
being linked with the industry.
The contribution of almost Rs 4 bn to the Indian and state exchequer via excise
and purchase tax.
The reservation of almost 2.3 mn hectares for U.P. sugar mills, accounting for
124 mn tones of sugarcane (almost 42 per cent of the national production).
The use of only 41.04 per cent of the sugar cane produced in the state by the
sugar industry, the rest going to gur, Khandsari, seed, juice, cattle feed and
chewing.
The need to produced 7.5 mn tones of sugar by 2010-11 through enhanced cane
drawal to fulfill the country’s increased appetite for the commodity.
The planned special incentive policy for the entry of private mills into sugar
manufacture due to a funds constraint among the government and co-operative
sectores.
An estimated capital requirement of Rs 20 billion to fund the new plants for
which a special incentive package may be required.
For being eligible for the incentives, the government announced the following
guidelines:
64
Minimum one time capital investment of Rs 3.5 bn or phased (from2007-08)
capital investment of Rs 5 bn; to commence commercial production by 31 march
2007.
Eligibility covering the setting up of new sugar units, expansion of existing
sugar capacity and related projects (ethanol/alcohol from molasses as well as co-
generation from bagasse).
Provision of monetary benefits in the form of capital subsidy and various
incentives on the cane purchase and sugar and molasses sale.
The government announced that these incentives would be provided only after the
company or the unit cleared all its sugar cane dues to farmers. For an investment of
over Rs 3.5 bn, the incentive would be applicable for five years; for an investment
over Rs 5 bn, the incentive would be applicable for ten years with a provision that
proceeds from the overall incentive did not exceed the capital investment. Triveni
intends to take advantage of this scheme.
65
2004-05 2005-06 2006-07 2007-080
10
20
30
40
50
60
70
80
0
10
20
30
40
50
60
70
80Stock Consumption Ratio Vs. Sugar Price
Stock Consumption Ratio Sugar Priceyear
%
Rs./ Q
uintal
The domestic price of sugar is expected to stay firm over the foreseeable future on account of the following factors: inventory is expected to stay under control due to increased consumption and rising exports; international sugar prices are expected to remain buoyant.
Some times saleable price is decided according to the average rate(Rate of last 1 year+2year+3 year) / 3.
66
MARKETING AND DISTRIBUTION
The company markets major parts of its output across Gujarat, Rajasthan, Punjab,
Utter Pradesh, Delhi and West Bangal through a network of 23 agents, each
enjoying an average relationship of over 25 years with the company.
SUGAR SALE:
TAX / DUTY FREE SALELEVY SALE
90% 10%
U.P. Sale Central
Sale
U.P. Sale Central
Sale
Basic Rate 1800 / beg 1800 / beg 1277.49(by
rail)
1275.92(by
road)
1277.49(by
rail)
1275.92(by
road)
Excise Duty 71 / beg 71 / beg 38 / beg 38 / beg
Cess 14 / beg 14 / beg 14 / beg 14 / beg
Educational Cess on duty 2% 2% 2% 2%
67
Entry Tax 2% NIL NIL NIL
Insurance charges NIL 2.25 / beg NIL NIL
Company also has to give a commission of 0.50% to the agent on the
amount of sugar plus excise duty on sugar.
If sale is above then 4,00,000 then company pay service tax plus cess on
service tax.
Service tax is 10% plus 2% cess on service tax till 17 April and after 17
April 12% plus 2% cess on service tax.
Company has to pay 4% Trade tax also.
Impart of Sugar Company also sale the MOLASSES. Molasses is also a very
important product, which is come after the production of sugar. Molasses is
used for the distillery. Company has a distillery unit in Muzaffarnagar.there
are two type of molasses sale.
Free sale. (80%)
Levy sale. (20%)
MOLASSES SALE
68
TAX / DUTY FREE SALE LEVY SALE
80% 20%
Basic rate 225/beg 225/beg
Excise duty 75/beg 75/beg
UP administration charges 11/beg 11/beg
Educational cess on duty 2%(1.50/beg) 2%(1.50/beg)
C.S.T. 4% 2.5%
OTHER SALES
Company also has some other type of sales.
Scrap sale
Press mud sale
Baggasse sale
SCRAP SALE
69
TAX/DUTY UP SALE CENTRAL SALE
Rate As per order As per order
Trade tax 5% Against C format 4% or 10
%
State development tax 1% NIL
TCS 1.02% 1.02%
PRESSMUD SALE
TAX/DUTY UP SALE CENTRAL SALE
Rate As per order As per order
Trade tax Nil Against C format at 4% or
10%
State development tax Nil NIL
TCS Nil NIL
BAGGASSE SALE
70
TAX/DUTY UP SALE CENTRAL SALE
Rate As per order As per order
Trade tax Nil Against C format at 4% or
10%
State development tax Nil NIL
TCS Nil NIL
There are some important points, which are necessary to understand or have to
keep in mind by the customers about the company.
Company has their sale office in New Mandi, Muzaffarnagar.
Each and every agent or customer has to pass there through this office.
After passing the bill, bill comes in the company.
Then company prepares a sale voucher and sends all details of sale to the
bank.Then sale takes place and bank receives the money from the agent or
customers.
After this whole process starts from the procurement of sugar cane and
payment of the sugarcane to the sale of sugar and receiving the payments from
agents or customers, Bank deduct the payment from the receives amount and their
Interest or commission, give the rest money or balance to the company. This
receivableable amount, which is getting by the company, is known as the profit of