K.S.S.K Ltd, Haveri.

INDUSTRY PROFILE
About Sugar Industry in India: India has been known as the original home of sugar and sugarcane. Indian mythology supports the above fact as it contains legends showing the origin of sugarcane. India is the second largest producer of sugarcane next to Brazil presently, about 4 million hectares of land is under sugarcane with an average yield of 70 per hectare. India is the largest single producer of sugar including traditional cane sugar sweeteners, khandsari and Gurequivalent to 26 million tons raw value followed by Brazil in the second place at 18.5 million tones. Even in respect of white crystal sugar, India has ranked No -1 positioning 7 out of last 10 years. History of Sugar Industry In India: Traditional sweeteners Gur & khadsari are consumed mostly by the rural population in India. In the early 1930 s nearly 2/3 rd of sugarcane production was utilized for production of alternate sweeteners, Gur & khandsari. With better standard of living and higher incomes, the sweeteners demand has shifted to white sugar. Currently, about 1/3rd sugarcane production is utilized by the Gur & khandsari sectors being in the small scale sector, these two sectors are completely free from controls and taxes which are applicable to the sugar sector. The advent of modern sugar processing industry in India began in 1930 with grant of tariff protection to the Indian sugar industry. The number of sugar mills increased from 30 in the year 1930-31 to 135 in the year 1935-36 and the production during the same period increased from 1.20 lakhs tones to 9.34 lakhs tones under the dynamic leadership of the private sector. The era of planning for industrial development began in 1950-51 and Government laid down targets of sugar production and consumption, licensed and installed capacity, sugarcane production during each of the Five Year Plan periods. The targets and achievements during various plan periods are given below.

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Manufacturing Process and Technology Sugar (sucrose) is a carbohydrate that occurs naturally in every fruit and vegetable. It is a major product of photosynthesis, the process by which plants transform the suns 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 beet root separated from rest of the plant material through a process known as refining. For sugarcane, the process of refining is carried out in followed steps Pressing of sugarcane to extract the juice. Boiling the juice unit lit begins to thicken and sugar begins to crystallize. Sinning the crystals in a centrifuge to remove 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 Beet sugar processing is similar, but it is done in one continuous process whit out the raw sugar stage. The sugar beets are washed, sliced and soaked in hot water to separate the sugar containing juice from the beet fiber. The sugar laden juice is purified, filtered, concentrated and dried in a series of steps similar to cane sugar processing. For the sugar industry, capacity is utilization conceptually different from that applicable to industries in general depends crucial factors the actual number of ton of sugarcane crushed 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

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K.S.S.K Ltd, Haveri.

crushing season also depends upon location with the maximum being in south India. Products produced worldwide are divided in to basic categories:

COMPANY PROFILE
Introduction of the Company: India is one of the highest sugars producing country in the world. It has large number of sugar manufacturing factories situated throughout the country. Karnataka Sahakari Sakkare Karkhane Ltd Sangur was registrated on 07-091973 and the production started on January 1983. Shri.F.S TAWARI was the founder as well as chief promoter of this factory, K.C.C Bank Dharwad had financed for the establishment of the factor. The establishment project cost was Rs.720 lakhs this is situated in 115 acres and its crushing capacity was 1250TCDin 1983 but in 1994-95 it was increased to 1800TCD .This factory is located on the bank of Varadha River it is 10km away from the haveri. Haveri is the center place for transportation because NH4 passes here and it connects various districts and taluks.
COMPANY AT GLANCE:

Name Of The Factory

Karnataka Sahakari Sakkare Karkhane Limited Haveri 7th September,1973 January, 1983 Karnataka Sahakari Sakkare Karkhane Limited Haveri

Year of Establishment 1st Cushing Started Location of The Unit

Register Number Registered Date Contact Persons 1) 2)

R.C.S.2757:73-74 7-9-1973 Company Secretary Labor Welfare Officer

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3)
Address For Correspondence

Chief Engineer

Karnataka Sahakari Karkhane Limited Haveri Phone Chairman Office Chief Engineer Fax : Std Code 08375 : 284444 : 284424 : : 284426

A. BACKGROUND AND INCEPTION OF COMPANY: KARNATAKA SAHAKARI SAKKARE KARKANE Ltd, Registered as a cooperative society on 7th OCTOBER 1973, under the Karnataka co-operative societies act 1959. The main purpose is to help sugarcane growers by purchasing sugar cane in this area. The manufacturing plant is located at Sangur village, Haveri Taluk, Haveri Dist, Karnataka. KARNATAKA SAHAKARI SAKKARE KARKANE Ltd proposed plant

capacity is 2500 TCD at villages Sangur , Haveri Taluk, for the manufacture of white crystal sugar along with the facilities for the co- generation of power with an installed capacity of 12 MV surplus powers. The estimated cost of this project is Rs.76.10 core, is proposed to by finance by way of share capital Rs.28.25 core and term loan Rs. 47.85 core. KARNATAKA SAHAKARI SAKKARE KARKANE Ltd, began its

production on 2005-06 as a trial production i.e. 11000 tonnes sugar produced by getting 17000 tonnes sugarcane but unfortunately the factory doesnt earned i.e. got loss due to several problems. During this year the factory allotted or paid a per ton Rs. 1400 to sugarcane suppliers (farmers) to attract the suppliers. During 2007-08 the factory produced 320000 Qtls. of sugar from 263128 tonnes sugarcane crushed with an average recovery of 12.01%. Govt. Of India has

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fixed the Statutory Minimum Price (SMP) of Rs. 883.30 PMT, the factory has paid Rs. 1050.00 per ton to sugarcane suppliers. During the Season 2008-09 the factory has Crushed 143052 tonnes of sugar cane and produced 147724 quintals of sugar with an average recovery of 10.40%. Govt. of India has fixed SMP of Rs. PMT, the factory has paid Rs. 1450/- PMT to the sugar cane suppliers. OBJECTIVES OF ORGANISATION To encourage self help, thrift and co-operation amongst members. To acquire lands, either by way of sale, lease or otherwise for cultivation of sugarcane and other crops and for erection of building, Machinery etc. To in calculate amongst members, improved modern methods of agriculture and cultivation of sugar cane and to supply seeds, material, manure implements etc., for growing sugar cane and other crops and to promote agriculture, Agro industries education for the well being of the members. To manufacture sugar, Jaggery and others by products out of sugar cane grown and supplied by members of the society and others and to sell the same to the best advantage. To make advance to members on the security of sugarcane or sugar made out of their sugarcane and to advance loans for raising their crops and development of Agriculture. To install machinery for the utilization of by-products and buy raw materials and finished products in the course of utilizing and marketing the by-products. To sell or otherwise dispose off the whole or any part or parts of its business assets or under takings or its factory, buildings, machinery and lands in the interest of the society with the prior approval of the Director of sugar and Registrar of co-operative societies or in the course of winding up the society. To undertake such other activities as are incidental and conductive to the development of the society. To encourage raising food and cash crops in the area where sugar cane is not grown. To undertake subsidiary and allied industries which are connected to the development and benefit of the society and its members. Institute of management studies .
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K.S.S.K Ltd, Haveri.

B. NATURE OF THE BUSINESS CARRIED: K S S K ltd was established during 1973 in Sangur. The nature of business in KSSK ltd is as follows; The main production of KSSK is manufacturing of sugar heir main input for production is sugarcane; sugar cane is the raw material for the production of sugar. Aim to manufacturing good quality sugar and its by products. Harvesting and processing season may vary from country to country and factory to factory depending on the convenience. Usually, the harvest starts in July/August and continues to April/may. Some factories have the continues supply of cane thought the year, and they process them in whole year without idle of the factory. There are varieties of sugarcanes which are available to farmers. Their sub production is power; they generate power and use it for production of sugar. During the season of sugar they generate power with the help of bagasse which is sub product of sugarcane. And during off season they will generate power with the help of wood and bagasse. By this we come to know that their main nature sugar and generation of power. COMPANY CHART CHAIRMAN: The Chairman (G.C.Hanchinal) of the factory shall have an overall control over day-today managements of the factory. He shall preside over meetings of the Board of Directors and the General body. The chairman of the factory shall have general control over the affairs of the factory. He shall exercise such of the powers of the Board as may be delegated to him. He shall sanction leave to the salaried personal of the mill as a whole as under: Leave to the Managing Director not exceeding 120 days. Institute of management studies .

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Leave to other salaried personal for a period exceeding 30 days but - not exceeding 120 days.

BOARD OF DIRECTORS The Board of directors shall consist of 18 Directors as under. i) 12 Members to be elected by the Grower Members. ii) One member to be elected by the co-operative members. iii) One member to be elected by non-grower member. iv) One representative of central financing agencies. v) Three nominees including Managing Director of the Govt. will be nominated by the State Govt.

THE KARNATAKA SAHAKARE SAKKARE KARKHANE LTD BOARD OF DIRECTORS

1. G.C.Hanchinal 2. M.V.Ghadi 3. S.R.patil 4. S.S.Sajjanar 5. P.R.Kundapur 6. N.M.Sheetalad 7. R.B.chouti 8. S.S.Mushti 9. C.N.Nitaginakoppa 10. Rajashekar katarki 11. C.M.Udasi 12. C.S.Naduvinmani 13. M.S.Honnali 14. V.G.motagi 15. B.G.Benchihalli
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Chairman Voice Chairman Director Director Director Director Director Director Director Director Director Director Director Director Director

K.S.S.K Ltd, Haveri.

16. R.N.Koteshwar 17. U.B.Veerapannanavar 18. D.M.karajagi 19. P.N.Patil 20. DCC Bank Davanageri C. Vision, Mission and Quality Policy:
VISION: We wish to grow into model sugar co-operation in the country. KSSK has dedicated to deliver overall value to their customers, delivering high quality products, exceptional financial performance to company shareholders and complete satisfaction to cane-growers, employees and stakeholders. To manufacture and trade in sugar and its by-products. To plant, cultivate cultivation, produce, raise and trade in sugarcane, sugar beets and other crops. Expansion of cane cultivation area to reach 30,000 lands under cane cultivation. Diversification ,Ethanol ,Sugar refineries, one more sugar plant, starch Director Director Director Director Director

manufacturing unit and increase in existing crushing capacity from 3500 TCD to 5000/7500MT. Enter into joint venture. Excellence in all spheres of management through.

MISSION: Efficiency in production. Up gradation of technology in work of changing technological need. To provide better salary and welfare facilities to employees.

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Increasing the production of sugarcane.

QUALITY POLICY: Regarding quality planning to provide healthy and sulphur free sugar to the customers.

D. PRODUCT PROFILE:
SUGAR The sugar produced in KARNATAKA SAHAKARI SAKKARE KARKANE Ltd, Haveri. Sugar factory is both refined confirming to EC!! Grade with negligible sulphur content as well as plantation grade white sugar. The EC11 grade sugar meets the European standards of refined sugar (Color of less than 45 IU). Sugar is a sweet, white or brown, usually crystalline substance obtained mainly from sugar cane or sugar beets and used commonly in food products. Sugar means something sweet in from of taste. Formula:12CO2+11H2O=C12H22O11+12O2 Carbon dioxide water=sucrose+oxygen In chemistry sugar refers to any of the class of carbohydrates to which this substance belongs. Glucose, lactose, and maltose are sugar most plants manufacture sugar is solute in water, sweet to the taste and either directly or indirectly for mentable. The chemist knows as sucrose one of the family of sugars otherwise known as saccharine as the name implies, contain carbon and hydrogen plus oxygen in the same ration as in water. Sugar is controlled commodity in India under the essential commodities Act,1995.The government controls sugar capacity additions through industrial licensing determines the price of the major input sugar cane, decides the quantity that

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can be sold in the open market, fixes the of the levy quarter sugar and determines maximum stock levels for wholesalers etc. RAW MATERIALS USED IN FACTORY:

1. Sugar cane 2. Bagasse 3. Chemicals and consumables 4. Lime and sulphur

Types (grades) of sugars produce in sssskn

1. S1(powder) size 2. S2(small) size 3. M-30(medium) size 4. L(big) size

By Products In Sugar Industry : The main by-products of sugar manufacturing are; a) b) c) Bagasse Molasses Press mud

a. Bagasse: Bagasse is the fibrous residue of cane stalk that is obtained after crushing and extraction of juice. It consists of water, fiber and relatively small quantities of small soluble solids. Bagasse constitutes about 30% of cane processed for production of sugar, is used as a fuel for generation of steam and power to meet the production requirements. b. Molasses: Molasses is the final effluent obtained in the preparation of sugar by repeated crystallization .Sucrose and invert sugars constitute a major portion (40 to 60%) of Institute of management studies .

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K.S.S.K Ltd, Haveri.

molasses. Molasses is used for production of rectifiers spirit, which is as a feedstock for production of chemicals as well as portable liquor. The country has been producing about 1, 7 billion liters of alcohol utilizing 75-80% molasses production in the country. Molasses can also be used for the production of ethanol which is used as a blend fuel with gasoline in the transport sector. c. Press Mud: Press mud is the byproduct generated by cane juice filtration during sugar manufacture. Impurities are precipitated during the course of clarification of sugarcane juice. The cake, which is discharged after washing, is called press mud. Currently press mud is used as fertilizer in sugarcane cultivation. Distillery effluents are mixed with press mud that comes from sugar factory to make bio-fertilizer a substitute matter. for chemical fertilizer .This mud contains certain mineral and organic

E. AREA OF OPERATION:
1) Haveri 2) Gadag 3) Dharwad Except 36 villages of Dharwad 4) Karwar Mundagod taluk Part of Sirsi taluk Haliyal taluk

5) Shimoga Sorab taluk 6) Bellary Part of Hadagali taluk Institute of management studies .
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K.S.S.K Ltd, Haveri.

Harpnahalli taluk

F. OWNERSHIP PATTERN:
It is a joint venture with share capital of Rs. 5.50 76.500 contributed by 20847 shareholders. The company was established in the year 1st September 1973 and started crushing in January 1983. The company is registered under the provision of Companies Act 1956.

G. COMPETITORS INFORMATION:
The major competitors are 1. 2. 3. 4. Shamanur sugars, Duggavatti (near Harihar) Malaprabha shakari sakkare karkhane, Mugatkhan (near kittur,Belgaum district) Renuka sugars , Munuvalli ( Belgaum ) Davanagere sugar company, kukkawad (Davanagere)

H. INFRASTRUCTURAL FACILITIES:
Residential quarters have been constructed for the workers, these quarters are divided in to 4 types i.e A, B,C and D A-Is meant for managing directors B- Is being provided to top management officer C-Is has been allocated to administrative D is being reserved for Supervisor and Technicians. Facilities Provided For Workers: They provided VAN for school childrens Medical facility to employees and their families

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Credit co-operative society has been also started to serve the needs of the employees. Provide uniforms, good canteen, leaves like, Casual leave 12 days per year Seek leave - 15 days per year Accidental leave 3 days per year Leave with permission 33 days per year

J. WORK FLOW MODEL (END TO END):

The process of manufacture of sugar involves the following step: 1) Extraction of Cane Juice from Cane. 2) Purification of Cane Juice. 3) Evaporation of cane Juice to Facilitates Crystallization. 4) Crystallization of Sugar. 5) Separation of Sugar and Liquid Centrifugal Force. 6) Reboiling of liquid. A brief description of the above process steps are given below:1. Extraction of Cane Juice from Cane:The cane which is weighed has unloaded in the carrier for conveying it to the mills after proper preparation to facilitate extraction of juice from sugarcane. It is the first prepared by passing through two sets of revolving knives that outs the stalks in to pieces and in some places passed through hammer mills shedders that shred the cane. The prepared cane enters mills, consists of multiple units of 3 roller combination through which the prepared cane /crushed cane passed.

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Juice from previous mills and water before last mills, directed on the blanket of Bagasse as it emerges from each mill help to leach out the sugar. In the best mills 95% of sugar goes in the juice. Uses of Bagasse: The residue that leaves the last mill is Bagasse which contains un-extracted sugar, wood fiber and 45 to 55% of water. This material goes to Boilers as fuel to produces steam, used in the running of turbines to generate electricity to run the plant and this bagasse is used as raw material for paper.

2.

Purification Of Cane Juice:- Clarification The juice is strained to remove Bagasse particles before sending for process

.This juice is weighed in automatic juice scales and the number of discharges are automatically entered /registered. The dark green juice from mills is acidic and turbid. The universal process employed to remove both soluble insoluble impurities employs lime and heat as he clarifying agent. In sulphitatio factories SO2 gas is passed through the lime juice also to bleach the solution. Milk of lime I In (0.5 kg) CaO (calcium oxide) per ton of cane neutralizes the natural acidity of juices forming insoluble lime salts, mostly calcium phosphate. Heating the juice to boiling the coagulates albumin, fats, waxes, and gums. The precipitate formed entraps suspended solids as well as finer particles .The entire things goes to continues clarifies where mud separates from clear juice by sedimentation. The mud goes to filtrates to remove the mud and clear juice goes to evaporates. 3. Evaporation Of Cane Juice To Facilitates Crystallizations:. The clarified juice having much the composition as a raw extracted juice except for the predicated impurities removed contains 85% water. 75% of this water is Institute of management studies .

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evaporated in vacuum multiple effects consisting of generally four vacuum boiling bodies arranged in series so that each succeeding body has a higher vacuum, therefore boils at a lower temperature. The vapour from one body can thus boil the juice in the next one. By this the heating steam introduced in the first body does multiple effect evaporation. The vapour from the last body goes to a condenser, which condenses the vapour and creates vacuum, in an Evaporator set of 4 bodies steam evaporates 4 times its weight of water. The clear juice which has about 15% solids is concentrated here to 65% solids and 35% water. This syrup is passed through a tower were SO2 gas also passed and bleaches the syrup remaining 35% water to produce sugar crystals.

4. Crystallization Of Sugar: Crystallization takes place in single effect vacuum pans, where the syrup is evaporated until saturated with sugar. At this point seed grain is added to serve as nuclei for the sugar crystals and more syrup is added as the water evaporates. Continuing the above process the pans are filled up till the desired size crystals are built up and dropped in mixers is called crystallizers. The sugar and syrup forms a dense mass known as massecuite. 5. Separation of Sugar And Liquid Centrifugalising: The Massecuite from crystallization where sugar deposits on crystals due to cooling is drawn into revolving machines called centrifugals. The cylindrical basket suspended on a spindle has performed sides, linked with wire cloth, inside of which are metal Sheets containing 400 to 600 perforations per square inch .The performed lines retain the crystals, which are washed with hot water. The mother liquor called molasses passes through the lining due to centrifugal force exerted. The sugar drops when machine is stopped .In the conveyor to remove moisture and high temperature,

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sugar is subjected to hot and cooled air treatment and Gradation in a grade as per I.S. Specification, weighed and baggage. 6. Reboiling Of Liquid (Molasses): The aim of sugar boiling is to remove more sugar and send less purity of molasses (final molasses) as by-product, from which sugar manufacture is uneconomical.

Michael E. Porters 5 Analysis Framework

Summary of Theory behind 5 Forces: The Porter's 5 Forces tool is a simple but powerful tool for understanding where power lies in a business situation. This is useful, because it helps the industry to understand both the strength of its current competitive position, and the strength of a position its looking to move into. With a clear understanding of where power lies, it can take fair advantage of a situation of strength, improve a situation of weakness, and avoids taking wrong steps. This makes it an important part of industrys planning toolkit Conventionally, the tool is used to identify whether new products, services or businesses have the potential to be profitable. However it can be very illuminating when used to understand the balance of power in other situations too.

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Five Forces Analysis assumes that there are five important forces that determine competitive power in a situation. These are:

1. Supplier Power: Here the industry assesses how easy it is for suppliers to drive up prices. This is driven by the number of suppliers of each key input, the uniqueness of their product or service, their strength and control over it, the cost of switching from one to another, and so on. The fewer the supplier choices it has, and the more it need suppliers' help, the more powerful its suppliers are. 2. Buyer Power: Here the industry should ask itself how easy it is for buyers to drive prices down. Again, this is driven by the number of buyers, the importance of each individual buyer to its business, the cost to them of switching from its products and services to those of someone else, and so on. 3. Competitive Rivalry: What is important here is the number and capability of competitors if the industry has many competitors, and they offer equally attractive products and services, then it will most likely have little power in the situation. If suppliers and buyers dont get a good deal from it, theyll go Institute of management studies .
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elsewhere. On the other hand, if no-one else can do what industry do, then you can often have tremendous strength. 4. Threat of Substitution: This is affected by the ability of industrys customers to find a different way of doing what it do for example, if the industry supplies a unique software product that automates an important process, people may substitute by doing the process manually or by outsourcing it. If substitution is easy and substitution is viable, then this weakens its power. 5. Threat of New Entry: Power is also affected by the ability of people to enter its market. If it costs little in time or money to enter its market and compete effectively, if there are few economies of scale in place, or if it has little protection for its key technologies, then new competitors can quickly enter its market and weaken its position. If it has strong and durable barriers to entry, then the industry can preserve a favorable position and take fair advantage of it.

FUNCTIONAL DEPARTMENTS
Finance Department: As the name gives the clear meaning of finance of that the inflow and out flow of cash. The Managing Director is the key person for who handles all the situations of the authority from managing Director for finance and keeping all the records of finance that is materials and also he is responsible for arranging the finance, working capital whenever need arises Functions: Reduce the cost of production. Reduce the overhead spending. Reduce the visual credit.

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Capital Structure: Authorized Capital: The authorized share capital is Rs 20 corers; there are 4 types of shareholders, which have been described as follows. SUBSCRIBED CAPITAL:

SL NO

PARTICULARS

NO.OF MEMBERS

SHARE AMT

A class(growers) B class(non grower) Cycles(Co-op society) D class(Government)

17708

2,58,08,000-00

2807

31,88,000-00

311

9,39,000-00

2,51,23,500-00

TOTAL

20827

5,50,58,500-00

Production Department:

Production Department

Chief Chemist

Deputy Chief Chemist

Lab Chemist

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Lab in charge

Supervisors

Workers The Chief Engineer, Chief Chemist and Civil Engineer form the structure of the production section. The chief Engineers work is to maintain technical and mechanical works and improve them to increase the crushing capacity. The chief chemist work is to instruct how where and when to use chemicals in the production process. The civil engineers work is to plan, where to situate the machineries and also they advise useful suggestions to make the production very easy and smooth.

Production Process: 1. Cane Yard In this they collect sugarcane from the farmers 2. Cane Weight In this they measure sugarcane including vehicle after unloading the cane. They measure vehicle weight and they deduct that weight in the total weight. Thus they get the actual weight of the cane. They prepare 3 weight receipts with the help of computers. One goes to Cane A/c another goes to farmer and third one goes to Transport Office. 3. Cane Carrier

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The unloaded cane is put down in carrier and carrier is driven by the motor. It is connected to cane cutter. 4. Cane Cutter Cane cutter of 2 types. a) b) 1st Cutter 2nd Cutter in this cane cuts into 12 to 20 inches In this cane cuts into 3 to 5 inches

After cutting, cane is forwarded in fib riser. The fibrised cane is taken into Mill section. 4. Mill Section In this section, the cane is squeezed. Whatever the quantity of juice quizzed in thee mill, is pumped into clarification house. At this time they get the by-product called bagasse. 5. Dorr The juice has some by-product like press mud and bagasse before it is stored in the Dorr. After storing in the Dorr, these are separated and move downward.

Establishment Section: It is concerned with the workers wages, salaries, bonus, leaves of workers etc. Brief explanation in each section is as follows: Division Of Labour

Departments

Permanent

Seasonal

Total

General administration

275

256

661

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Engineering 90 122 212

Manufacturing

19

147

166

Civil

14

26

92

Cane Development

40

52

92

Store Section

14

Godown

Time Office

12

Guest House

Vehicle

Sabhangana

Total

464

619

1213

Salary To Workers: 1. Permanent workers generally get Rs.3000 to 7000 including all allowances like HRA,medical etc. Salary approved by central government,

S.No.

Category of Workers

Pay Scale

Medical allowance

HRA

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1 2 3 4 5 6 7 8 9 10 11 12 Unskilled Semiskilled Skilled-B Skilled-A Highly Skilled Clerical-iv Clerical-iii Clerical-ii Clerical-i Supervisor-C Supervisor-B Supervisor-A 1700-25-1950-302250-35-2775 1800-30-2100-35-2450-4-3050 1950-40-2350-45-2800-50-3550 2100-45-2550-50-3050-55-3875 2200-50-2700-55-3250-60-4150 1950-40-2350-45-2800-50-3550 2100-45-2550-50-3050-55-3875 2200-50-2700-55-3250-60-4150 2300-55-2850-60-3450-65-4425 2300-55-2850-60-3450-65-4425 2400-60-3000-65-3650-70-4700 2600-75-3350-90-1250-105-5825 2800-100-3800-115 - 4950-1306900 150 150 150 150 150 150 150 150 150 150 150 150 170 180 195 210 220 195 210 230 230 240 260 280

13

Special Grade

150

M.D and secretary gets approximately Rs 18000 and Rs 15000 respectively including all allowances. 1. Seasonal workers get Rs.1000 to Rs.3000 during season. In case of unseasonal & seasonal employees get retaining allowances as follows: Unskilled workers get 29% of salary

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Semiskilled workers get 39% of salary skilled and clerical workers get 52% of salary Time and Labour Welfare Section The is no social department like HRD or personnel Management in the factory so Time and labour welfare officer is there, in this office there is labour welfare officer and Head Timekeeper, Shift Timekeeper and Wage Clerk is there. The main functions are as follows, The shifts are divided into 3 shifts 4. 12 8. 8.30 1.30. am am am am. pm to to to to to 12. 8. 4. am. am. am.

1st Shift 2st Shift 3st Shift General shift is

12.30. pm. and 5.30. pm

Time cards are provided to workers so that whenever they come to factory, they are souse to sign in the register and take a sign from timekeeper.

To take care of all the workers i.e. their safety welfare measures.

Welfare Facilities: 1. 2. 3. 4. 5. 6. Bonus is 8.33% based on workers salary. Quarter, hospital etc facilities and allowances. Canteen facility. Promotion facility. Permanent workers get one Increment every year. Factory provides two pair of uniforms and one pair of shoes per two years

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To workers. 7. School facility to workers children and also school bus carries children Factory to Haveri freely. 8. 9. Compensation and medical facilities are available if any accident occurs. Workers get double payment if they work and O.T. duty and also id they work in government holidays as per Factories Act- 1948. Purchase Section: The main function of purchase section is to purchase all the necessary raw materials required by the factory except sugar cane. It is under the control of Chief Engineer. Purchase Procedure: First concerned engineers prepare a list of materials according to the requirement and sent the report to the purchase section. First it goes to the stores section to enquire whether they are having a required stock or not. If there is no stock then purchase officer invite quotations from different companies by sending purchase in Executive committee Meeting. This committee has 8 directors and Managing director. This committee decides from which company have to purchase. After this purchase officer sends the purchase order to the concerned company and payments will be made on agreed date. Concerned company supplies the required materials within few days. Suppose the requirement is more than 25 lakhs then Government of Karnataka interferes in the problem and it also appointed a state level Advisory committee for this purpose. Materials usually purchased are: Machinery related like nut bolts, bearing parts of boilers, scraper plate, ruler, pipes & fittings, electrical materials, oil, grease etc., Electrical materials, production related like sulfur, gunny bag, chemicals, Burt lime etc Institute of management studies .

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Past Cane Purchase Rate:

Year

Quantity Purchased (in Metric Tons)

Amount per Ton

1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03

48325 153028 156918 75127 130927 196616 180940 129763 253076 246037 196187 136068 182460 275795 140569 107029 100442

250 275 310 335 388 440 500 616 666 666 702 765 830 756 763 800 850

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K.S.S.K Ltd, Haveri.

2003-04 2004-05 2005-06 2006-07 2007-08 53697 53697 38440 52680 67842 866 866 1200 1200 1200

Store and stores account: Stores Section have all purchased materials required by the factory. It is also under the control of Chief Engineer. It supplies necessary materials to factory according to the concerned engineers order. It maintains different accounts on the bases of section. 1. 2. 3. 4. 5. Mechanical section A/c. Electrical section A/c. Manufacturing section A/c. Civil Engineering section A/c. Cane Development section A/c. When materials come to the store section storekeeper pass an indent and inform to the concerned engineers then engineers check the materials and issue a Quality Certificate. If materials are rejected, they are returned to the supplies with

Delivery memo. Storekeeper again passes an Indent, when materials are supplied to the factory. In this section they maintain 3 books, Institute of management studies .

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K.S.S.K Ltd, Haveri.

1. 2. 3. First Information Report (FIR) Stores Received Book (SRB) Bin Card. At present STORE SECTION have approximately 4000 items and their cost is approximately Rs, 1 Cores. In STORES ACCONT also they maintain all records of STORE SECTION but they maintain only 2 books. 1. 2. Stores Received Book. ( S R B ) Stores Ledger Folio. (SLF)

Stores ledger Folio is just like Bin card but only one change is, in Bin card there is no any Amount Column. But in stores ledger folio amount column is there. Share section: According to By-law, the factories authorized share capital is Rs.20 cores. At present the number of Shareholders is 20847 and capital collected from all the shareholders is Rs.5506100. Factory Issues mainly 4 types Of Shares: 1. 2. 3. 4. A Class B Class C Class D Class -----producer members.

------ Non growers or ordinary members. ------ Co- operative societies. ----Government.

Share Value: The face value of each share Share admission fee Institute of management studies . - Rs 1000/- Rs 25/28

K.S.S.K Ltd, Haveri.

Share fee Total share value Account and cash section: Cash Section In this section all the payments are done recorded, for instance any payment made to farmers regarding sugarcane purchases is also recorded in this section, payment is made through bank cheque and sent to bank in which farmers have their accounts. Account Section Accounts are maintained in traditional method no computers are provided in this section. It is divided in to 2 sections. 1. Cane Account In this section all the farmers name, their sully of sugarcane and their payment that has to be made are recorded. Here purchases are recorded in the purchase registrar and another book is personal ledger which involves the entire farmers name and another book is personal ledger which involves the entire farmers name and their payments are recorded. Cane Accounts are divided into 28 circles and each circle had 7-8 villages for each circles one assistant is there to maintain records. 2. General Account In this section all the purchases of materials, which are required for factory like gunny bag, bearing, spare parts, etc., and their prices are recorded. And also all employees salaries, payments etc are maintained. - Rs 10/- Rs 1035/-

Sales Section: The main product of K.S.S.K Ltd is sugar and by-products are bagasses, molasses, press mud. These are all sold by calling tenders. Because the factory has no Institute of management studies .
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K.S.S.K Ltd, Haveri.

right to sale these products directly in the open market. The office superintendent does this work and sales officer with the help of sugar directors office Bangalore Central government fixes the selling quantity. There are two types of sales, a) Free sale b) Levy sale Free Sale In this type, factory calls Tenders at a fixed rate. Highest bidder will get the sugar. If rates are unsatisfactory they have right to reject the renders. The rate of excise duty, tax etc for the free sale sugar is Rs, 85 per quintal 90% of the produced sugar. 10% of the produced sugar.

Comparative study of free sale of sugar Rs. 85 per quintal)

Year

Sales (in quintals)

Amount (in Rs)

2002-03

149555

171406019.50

2003-04

84233

98079216

2004-05

51312

75079253.95

2005-06

27634

44743060.30

2006-07

7619

10263232.30

2007-08 Levy Sale

1244

105807.50

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K.S.S.K Ltd, Haveri.

According to the order of the Government, factory issues sugar to some Cooperative societies at a fixed rate. This is called levy sale. The rate is fixed by Central Government. Comparative study of levy sale of sugar (Rs. 52 per quintal)

Year

Sales (in quintals)

Amount (in Rs)

2003-04

13345

16964674.45

2004-05

3187

4259162.35

2005-06

5201

7054271.33

2006-07

3146

4360805.42

2007-08

2035

105807.50

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K.S.S.K Ltd, Haveri.

SWOT ANALYSIS OF COMPANY

STRENGTHS:
1. 2. Produces good quality of sugar. There is no any Sugar factory so there is little bit of monopoly in the purchase of Sugarcane. 3. 4. It is near the river of Varada so there is availability of sufficient water. K.S.S.K is not dependent on K.P.T.L for supply of power while production is carrying on they generate power through rower. 5. It is awarded as largest sugar producer in Karnataka.

WEAKNESS:
1. Since it is agro based industry, monsoon affects its production. 2. Lake of good administration 3. Lake of infrastructure. 4. Backward technology and sophistication. 5. This company does not have its own website.

OPPORTUNITIES:
1. Possibility of willing cooperation by banks. 2. Arrangement for KPTCL grid.

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K.S.S.K Ltd, Haveri.

THREATS:
1. Non availability of low interest rate and financial assistance. 2. Competition from domestic player. 3. Due to unfavorable government policies, company has to sell sugar below its production cost.

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K.S.S.K Ltd, Haveri.

Summary of The Latest Annual Report of The Company

PROFIT &LOSS ACCOUNT OF FY07 AND FY08 (Rs. IN LACS) PARTICULARS INCOME Sales Less: Excise Duty 57,013.33 12,550.13 44,463.20 Increase/decrease in stock Other income TOTAL 11,763.45 424.80 56,651.45 48,794.17 9,384.19 39,409.98 851.88 1,294.86 41,556.72 FY08 FY07

EXPENDITURE Cost of raw material consumed & purchase of Trading Goods Manufacturing, Expenses Interest & Finance Charges Depreciation Amortisation TOTAL 2,370.63 3,392.94 49.51 59,457.79 1,852.60 1,672.37 18.03 38,573.91 Selling &Administration 10,756.97 10,076.59 42,887.74 24,954..32

Profit for the year before taxation LESS: Taxation Income tax & wealth tax Current year Short/(Excess)Provision for earlier years Deferred Tax Adjustment Debit/(credit) Institute of management studies .

(2,806.34)

2,982.81

0.00 2.09

350.00 0.81

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K.S.S.K Ltd, Haveri.

(804.46) (802.37) Fringe Benefit Tax Current Year Short/(excess) Provision for earlier years (0.33) TOTAL TAX (802.70) 0.00 1,495.90 0.00 1,122.09 1,472.90 23.00

Net profit for the year after tax Add profit brought forward from earlier year

(2,003.64)

1.486.91

604.93 Profit available for appropriation (1,398.71)

647.07 2,133.98

Appropriations General Reserve Dividend Corporate Dividend Tax Surplus Carried forward 0.00 0.00 0.00 (1,398.71) (1,398.71) 1,200.00 281.25 47.80 604.93 2,133.98

Basic & diluted Earnings per Equity Share of Re.1 (1.78) 1.54

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K.S.S.K Ltd, Haveri.

BALANCE SHEET (RS in LACS) Particular FY08 FY07

SOURCE OF FUNDS 1.Shareholders fund a..share capital b..reserves and surplus TOTAL 1,125.00 7,243.03 8,368.03 1,125.00 9,246.67 10,371.67

2.LOAN FUNDS a. Secured loans b. Unsecured loans TOTAL 31,452.93 3,399.06 34,851.99 26,369.97 2,040.63 28,410.60

3.DEFERRED TAXATION(Net) TOTAL

782.37 44,002.39

1,586.82 40,369.09

APPLICATION OF FUNDS 1.FIXED ASSET a.Net block b. Capital work in progress TOTAL 19,318.65 296.36 19,615.01 21,529.68 51.72 21,581.40

2.Intangiable Assets 3.Investments

82.23 138.53

107.17 2,370.82

CURRENT ASSET,LOAN,ADVANCE 1.inventories 2.sundry debtors 3.cash and bank balance Institute of management studies . 32,022.25 2,958.47 2,665.18 19,171.39 2,999.54 1,928.08

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K.S.S.K Ltd, Haveri.

4.loans and advance 5.other current assets TOTAL CURRENT ASSET 1,632.38 2,067.28 41,345.56 1,558.32 3,350.53 29,007.86

CURRENT LIABILITIES,PROVISION 1.current liabilities 2.provisions TOTAL CURRENT LIABILITIES 16,305.45 873.49 17,178.94 11,216.28 1,481.88 12,698.16

NET CURRENT ASSET

24,166.62

16,309.70

TOTAL ASSET

44,002.39

40,369.09

RATIO ANALYSES:1. CURRENT RATIO= CURRENT ASETS/CURRENT LIABILITIES

CURRENT RATIO

CURENT ASSETS

CURRENT LIABILITIES

2.44

39,713.18

16,305.45

Theoretically, the standard of current ratio is 2:1. But in practice, it changes from industry to industry. If the current ratio is more than 1:1, it means to say that the firm is in position of meet its short term obligations like creditors, bills payable, bank over draft and the like. In KSSK LTD, the current ratio is 2.44 in FY 2007-08. But current asset has been increased very marginally.

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K.S.S.K Ltd, Haveri.

2. NET WORKING CAPITAL RATIO=TOTAL CURRENT ASSETS/TOTAL CURRENT LIABILITIES. NET WORKING CAPITAL RATIO TOTAL CURRENT ASSETS TOTAL CURRENT LIABILITIES.

2.44

39,713.18

16,305.45

Higher the ratio greater the ability of the firm to meet its current obligations and vice-versa.KSSK LTD having 2.53 in 2007-08. If this ratio is more than 1 time we can say that the firm is solvent. 3. DEBT-EQUITY RATIO =LONG-TERM DEBT/SHAREHOLDERSFUND DEBT-EQUITY RATIO 0.35 2,958.47 8,368.03 LONG-TERM DEBT SHAREHOLDERSFUND

In present case, the debt-equity ratio is less than one in both the years. So we can say that KSSK LTD was a profit making company. Because EBIT was less than one 4. PROPRIETARY RATIO= Owners fund/total assets. PROPRIETARY RATIO 0.20 8368.03 41484.09 Owners fund Total assets

The proprietary ratio in 2007-08. This numbers indicates that if there is an Rs 100 worth of asset Rs 20 has been covered by owners fund and the rest of Rs 80 has been borrowed to finance that asset.

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K.S.S.K Ltd, Haveri.

5. DEBT TO TOTAL ASSET RATIO: This ratio shows the relationship of total debt borrowed to finance an asset. And also, it is an indication that how much of debt is outstanding on a particular asset. RATIO 0.15 DEBT 2958.47 ASSET 19615.01

This is other face of proprietary ratio. It means, this ratio says how much of money has been borrowed to buy an asset. In 2006-07, this ratio has declined to 79%. Here, you have to observe a fact that the total of proprietary ratio and debt ratio is always equal to one. Consider the table: YEAR PROPRIETARY RATIO=1 2009-10 RATIO+DEBT 0.20+0.80=1

6. INTEREST COVERAGE RATIO= EBIT/interest RATIO 1.18 EBIT 2806.34 INTEREST 2370.63

7. STOCK TURNOVER RATIO = Cost of Goods Sold/ Average Stock

Stock Turnover Ratio Cost of goods sold 1.78 times 57,013.33

Average stock 32022.25

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K.S.S.K Ltd, Haveri.

It determines the number of times stock is turned in sales during the accounting Period under consideration. It expresses the relationship between the costs of Goods sold and stock of goods. Significance: It studies the frequency of conversion of stock of finished goods into sales. It is also a measure of liquidity. It determines how many times stock is purchased or replaced during a year. 8. FIXED ASSET TURNOVER = Net Sales/Net Fixed Assets

Fixed asset turnover 3.24 times

Net Sales 42491

Net Fixed Assets 13123

Fixed Assets Turnover: It is computed follows: Fixed asset turnover = Net Sales/Net Fixed Assets

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K.S.S.K Ltd, Haveri.

LEARNING EXPERIENCE
I done my in-plant training in Karnataka Sahakari Sakkare Karkhane Ltd in Sangur.,Haveri During in-plant training I had a good experience in KSSK Ltd Sangur it was a great knowledge based and excellent training program . All the staff members of KSSK Ltd were co-operative and friendly in their approach. Whenever I visited to all the functional departments. This 4 weeks corporate exposure and learning program conducted by the DAVANGERE UNIVERSITY, had gained me a lot. This program helped me in understanding the various functions of sugar industry and the Michael Porters framework showed the organization aspects. In every department whether it is a lower level or higher level the concerned, staff given me all the necessary information whatever I required to learn. Overall its been a good experience. In the plant I had gone through various departments with interacting between the heads of department then there only just I noted some of the aspects, which are required to me. It was more like a practical experience rather than theoretical i.e. I visited some of the plants (manufacturing) section. And also able to see how day-to-day functions are carried out. During this period, I met almost all the supervisory cadre employees in their plant to get the relevant information whatever required for me. Finally I had a great memorable experience for me that getting experience in corporate environment. It is a good flat form for every post graduate management student to get practical experience in corporate environment, and also to understand how theoretical aspects are applied in actual workplace I also learned organization culture, values, and attitude and Gained knowledge regarding organizational functioning. Institute of management studies .

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K.S.S.K Ltd, Haveri.

BIBILIOGRAPHY
Books:

Philip Kotler Marketing Management (Thirteenth Edition) Dorling Kinderley (India) Pvt Ltd , New Delhi 2009 Page No: 55 to Page No: 56

M Y Khan and P K Jain., Management Accounting (Third Edition) Tata McGraw-Hill Publishing Company Limited, New Delhi. 2002 Page No:- 4.14.36. Book No-4346

Reports: Company Annual Report.(Year-2007-08)

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