Paavai Engineering CollegeA STUDY ON INVENTORY MANAGEMENT IN CHETTINAD CEMENT CORPORATION LIMITED, KARUR PROJECT REPORT Submitted by S.GOKUL Register No: 108001612014 In partial fulfillment for the award of the degree Of MASTER OF BUSINESS ADMINISTRATION In DEPARTMENT OF MANAGEMENT STUDIES PAAVAI ENGINEERING COLLEGE PACHAL, NAMAKKAL-637 018 JUNE 2012 Chettinad Cement Corporation Limited Paavai Engineering College BONAFIDE CERTIFICATE PAAVAI ENGINEERING COLLEGE DEPARTMENT OF MANAGEMENT STUDIES PROJECT REPORT JUNE 2012 This is to certify that the project A STUDY ON INVENTORY MANAGEMENT IN CHETTINAD CEMENT CORPORATION LIMITED, KARUR Is the bonafied record of project done by S.GOKUL Register No: 108001612014 Of MBA during the year 2011-2012 --------------------------- ------------------------- Project Guide HOD Submitted for the Project Viva-Voce examination held on ---------------------------- ----------------------------- -------------------------- Internal Examiner External Examiner Chettinad Cement Corporation Limited Paavai Engineering College DECLARATION I affirm that the project work entitled A STUDY ON INVENTORY MANAGEMENT IN CHETTINAD CEMENT CORPORATION LIMITTED, KARUR being submitted in partial fulfillment for the award of Master of Business Administration (MBA) is the original work carried out by me. It has not formed the part of any other project work submitted for award of any degree or diploma, either in this or any other University. Signature of the Candidate I certify that the declaration made above by the candidate is true Signature of the Guide Chettinad Cement Corporation Limited I offer my profound gratitude to Dr.Paavai Engineering College ACKNOWLEDGEMENT I would like to express my gratitude to Shri. Namakkal for giving me an opportunity and facility to complete this project. Department of Management Studies. Paavai Engineering College.Gopalakrishnan.A.Com. I wish to place my deep sense of gratitude to Dr..M.. for his guidance and supervise of this project for successful completion. S. I sincerely thank to Mr. M. I express my sincere thanks to my beloved parents. Jegadheesan. Natarajan. Principal. Mangai Natarajan.. I owe my boundless gratitude to my faculty guide. Ph..B.CA. Correspondent. friends and the staff member for and those who are encouraged and supported for completion and this project report. HR manager.E.Phil. Ph.G. Ph. Namakkal.Arumugam. B... C. M.D. M. M. Ph. V.Sc.. Paavai Institutions.E. Karur for giving me permission to do this project at their concern. Paavai Engineering College. M. K.. N.D Head. for his entire support to complete this project report. MS.B. Director Admin. K. Paavai institutions and I would like to express my gratitude to Dr.D.A. Ramaswamy. Namakkal.GOKUL Chettinad Cement Corporation Limited .Com.D Professor of MBA Department. FCA. M. Chairman and Smt. Chettinad Cement Corporation limited.Thirunavukarasu. M.A.. Dr.Phil. 2 Analysis Part-2 EOQ Analysis SUMMARY OF FINDINGS.1 About the study I 1.1.1 Analysis Part-1 Ratio Analysis(Inventory) 4.1 Industry profile 2.2 Scope of the study 1.1.1.5 Research methodology INDUSTRY AND COMPANY PROFILE 2.1 Conceptual and theoretical frame work of inventory management 3. SUGGESTIONS AND CONCLUSION V 5.1.4 Cement company in Karur 2.2 Cement industry in India 2.2 Company profile CONCEPTUAL AND THEORETICAL FRAME WORK III 3.Paavai Engineering College TABLE OF CONTENTS CHAPTER NO DESCRIPTION PAGE NO LIST OF TABLES LIST OF CHARTS ABSTRACT INTRODUCTION 1.2 Review of literature ANALYSIS OF INVENTORY MANAGEMENT IV 4.1 Cement industry in Global II 2.3 Conclusion BIBLIOGRAPHY Chettinad Cement Corporation Limited .3 Cement industry in Tamilnadu 2.4 Objectives of the study 1.1 Findings 5.2 Suggestions 5.3 Statement of the problem 1. 2 EOQ analysis for the year 2007-08 4.1.1.2.2.2.2 Inventory turnover ratio 4.1.1 EOQ analysis for the year 2006-07 4.1 Level of inventory 4.3 Inventory conversion period 4.2.1.1 Level of inventory 4.3 EOQ analysis for the year 2008-09 4.3 EOQ analysis for the year 2008-09 4.1.5 EOQ analysis for the year 2010-11 Chettinad Cement Corporation Limited .2 Inventory turnover Ratio 4.2. Description Page No.5 EOQ analysis for the year 2010-11 LIST OF CHARTS Chart No.4 EOQ analysis for the year 2009-10 4.1.2.2.4 EOQ analysis for the year 2009-10 4. 4. 4.2. Description Page No.3 Inventory conversion period 4.2 EOQ analysis for the year 2007-08 4.2.1 EOQ analysis for the year 2006-07 4.2.Paavai Engineering College LIST OF TABLES Table No. Inventory turnover ratio. inventory conversion period are very helpful to know how effectively plays and control in the organization EOQ analysis will enables the organization to use of EOQ analysis is very effective and useful tool for classifying.Paavai Engineering College ABSTRACT The purpose of inventory management is to ensure availability of raw material in sufficient qualities as and when required and also minimize investment in inventories. Chettinad Cement Corporation Limited . There is an essential to manage inventories efficiently and effectively in order to avoid excess investment. The reduction of excessive inventories will create a favorable impact on the company profitability. monitoring and control of inventories. It is possible for a company to reduce the level of inventories to a considerable extent without any adverse effect on production and sales by using simple inventory planning and control techniques. 1 ABOUT THE STUDY Chettinad Cement Corporation Limited .Paavai Engineering College CHAPTER-I INRODUCTION 1. 3. These. dyes. 2. carrying costs of inventory. returns and defective goods and demand and forecasting. Types of inventory Normally the inventory has divided into two types. For the leather crafting business. that are partially constructed. Inventory management is recurred at different locations within a facility or within multiple locations of a supply or network to protect the regular and planned course of production against the random disturbance of running out of materials or goods. Raw materials: Everything the crafter buys to make the product is classified as raw materials. That includes leather. In addition to the raw materials. The scope of Inventory management also concerns the fine lines between replenishment lead time. 1. Inventory forecasting. quality management. Manufacturing inventory. 2.Paavai Engineering College Inventory management is primarily about specifying the size and placement of stocked goods. the work in process inventory includes the cost of the labor directly doing the work and manufacturing overhead. The raw material inventory only includes items that have not yet been put into the production process. physical inventory. 1. asset management. The manufacturing inventory has been subdivided into three types. available physical space for Inventory. Raw materials. Work in process. Finished goods. Work in process: This includes all the leather raw materials that are in various stages of development. it would include leather pieces cut and in the process of being sewn together and the leather belts and purse etc. Merchandising inventory. These. snaps and grommets. Manufacturing overhead is a Chettinad Cement Corporation Limited . Unqualified employees in charge of inventory.Paavai Engineering College catchall phrase for any other expenses the leather crafting business has that indirectly relate to making the products. 1. Computer inventory systems are too complicated. Too much distressed stock in inventory. they are finished goods. now for the entire product. The finished goods inventory also consists of the cost of raw materials. 1. Excessive inventory in stock and unable to move it quickly enough. labor and manufacturing overhead.2 SCOPE OF THE STUDY The study helps the management to improve its profitability through a reduction in non- moving inventory. Finished goods: When the leather items are completely ready to sell at craft shows or other venues. The company will make the proper inventory methods from the suggestions of the study. Here are some of the more common problems with inventory systems.3 STATEMENT OF THE PROBLEM There are a number of problems that can cause havoc with inventory management. 1. Some happen more frequently than others. Items in-stock gets misplaced. Not keeping up with the rising price of raw materials. A good example is depreciation of leather making fixed assets. The study helps to show the level of the inventory in the organization. It develops the policies for both continuous review of inventory management system. Bottlenecks and weak points can interfere with on-time product delivery. Not identifying shortages ahead of time. Computer assessment of inventory items for sale is inaccurate. Using a measure of performance for their business that is too narrow.4 OBJECTIVES OF THE STUDY Chettinad Cement Corporation Limited . Karur District. Area of study This study was conducted in Chettinad cement corporation limited. Tools for analysis Chettinad Cement Corporation Limited . Period of study This study covers a period of five years from 2006 – 2007 to 2010 – 2011. The necessary data calculated from annual report. To study the inventory management followed in chettinad cement. To identify the existing inventory management and its effectiveness.Paavai Engineering College To analyze the inventory those are sufficient to perform production and sales activities smoothly.5 RESEARCH METHODOLOGY Research Design The Descriptive type of research has been applied in the study . 1. Data collection This study purely based on secondary sources of information. This research the researcher has no control over the variables. journals and websites. The accounting year commenced from April and ending with March of the next year. books. Puliyur. Only reports what has happened or what is happening. To calculate analysis for their performance in inventory management. The research can only discover causes but cannot control the variables. its investment objective and/or the portfolio manager's investing style will play an important role in determining its turnover ratio. The framework used to determine this order quantity is also known as Wilson EOQ Model.The most economical quantity of a product that should be purchased at one time. W. EOQ refers to the size of the order which gives maximum economy in punches of materials.Paavai Engineering College The following tools have been applied in the present study. Harris in 1913. 2 Ao EOQ = √ C1 Where A = Annual usage in unit O = Ordering cost C1 = Carriying cost Chettinad Cement Corporation Limited . The EOQ is based on all associated costs for ordering and maintaining the product. The model was developed by F. The type of mutual fund. Economic Order Quantity (EOQ) Economic order quantity is that level of inventory that minimizes the total of inventory holding cost and ordering cost. They are listed below Ration analysis (inventory) and EOQ analysis Ratio Analysis (Inventory) The percentage of a mutual fund or other investment vehicle's holdings that have been "turned over" or replaced with other holdings in a given year. 1 INDUSTRY PROFILE Chettinad Cement Corporation Limited .Paavai Engineering College CHAPTER-II INDUSTRY AND COMPANY PROFILE 2. Paavai Engineering College History of the origin of cement It is uncertain where it was first discovered that a combination of hydrate non-hydraulic lime and a pozzolan produces a hydraulic mixture. Although weak pozzolanic concretes continued to be used as a core fills in stone walls and columns. in contact with sea water. but concrete made from such mixture was first used on large scale by roman engineers.driven by three main needs: Hydraulic renders for finishing brick buildings in wet climates Hydraulic mortars for masonry construction of harbor works etc . The use of structural concrete disappeared in medieval Europe. Varieties of the cement There are some varieties in cement that always find good demand in the market. Many excellent examples of structures made from these concretes are still standing. Notably the huge monolithic dome of the pantheon in Rome and the massive Bath of Caracalla. it will be better to take a look at some of the details given below. They used both natural pozzolans (trass or pumice) and artificial pozzolans (ground brick or pottery) in the concretes. Modern cement Modern hydraulic cement began to be developed from the start of the industrial Revolution (around 1800) . To known their characteristics and in which area they are most required. Portland blast furnace slag cement (PBFSC) Chettinad Cement Corporation Limited . The vast system of roman aqueducts also made extensive use of hydraulic cement. Rapid hardening Portland Cement (RHPC) The texture of this cement type is quite to that OPC. Sulphate resisting Portland Cement (SRPC) This cement is beneficial in the areas where concrete has an exposure to seacoast or sea water or soil or ground water.Paavai Engineering College The rate of hydration heat is found lower in this cement type in comparison to PPC. But. Magnesium (MgO). This cement has high demand in India. limestone and iron scrap. This is applied on both the off-shore and on-shore of the wells. Portland Pozolona Cement (PPC) As it prevents cracks. In the production of this type of cement in India. it is bit more fine than OPC and possesses immense compressible strength. Under any such instances. The rate of hydration heat is lower in this cement type. Clinker Cement (CC) Chettinad Cement Corporation Limited . Oil Well Cement is used in constructing or fixing oil wells. Coal waste or waste or burnt clay is used in the production of this category of cement. it is useful in the casting work of huge volumes of concrete. Ordinary Portland Cement (OPC) Also referred to as grey cement or OPC. trioxide (SO3) components are used. by using this cement one can reduce the impact of damage to the structure. It can be availed at low cost in comparison to OPC. it is of much use in ordinary concrete construction. coke. Oil Well Cement (OWC) Made of iron. Silica (SiO2). and Sulphur. Iron (fe2O3). It is most useful in massive construction projects. the concrete is vulnerable to sulphates attack in large amounts and can damage to the structure. which makes casting work easy. for example-dams. Hence. This cement has high these cement one can reduce the impact of damage to the structure. Hydrophobic cement. Chettinad Cement Corporation Limited . 2. some of the other types of cement that are available in India can be classified as: Low heat cement.1. Demand World cement demand was 2. High early strength cement. an increase higher than the total yearly European demand. High aluminum cement and Masonry cement.Paavai Engineering College Produced at the temperature of about 1400 to 14560 degree Celsius. The expected demand for 2010 is estimated at 2.283MT in 2005. China will increase its demand by 250MT during the period. houses and bridges.1 Cement Industry in Global Cement is a basic ingredient for the construction industry. It is estimated there are 1500 integrated cement production plants in the world. Clinker cement is needed in the construction work of complexes. limestone and bauxite. the share of the four largest firms account only for 23% of the overall demand. A part from these. The ingredients for this cement comprise iron. clay.836 MT. Although the players such a Lafarge or CEMEX. quartz.064MT (47% of total). with China accounting for 1. com.Paavai Engineering College The Demand of Cement Demand for cement in MT 2005 2010 Growth rate North America 170 200 2.2% Asia/Pacific 1500 1900 5.com.cementhistory. Chettinad Cement Corporation Limited .7% World cement demand 2283 2836 4.7% Source: www.2% Other regions 405 500 4.9% Western Europe 208 236 2.google. www. ask. Monarch Cement Ltd. China 11.A 15. Semapa Group Europe 25. California 20. Smith-Midland Cement Company U. James Hardie Cements U. CEMEX Co. Concrete Casting Cement Company Pacific Alloy 13. CRH plc America 14.Paavai Engineering College Top 25 Cement companies in the world S. Ready Mix Inc India 23.S. Cimpor Cement corp. Cement Cruz Azul Cement Co. U. Milford Cementwww.A.com. en.S.wikipedia. South Africa 7. Norcem Germany 21.A Brazil 12.NO Name of the Company Name of the Country 1. Libyan Cement Company Libya 19.com. Rinker Group Australia 24. Al-Ghurair Group Dubai 3. U. Ararat Cement Co.linkedin.google. Ambuja Cements Limited India 4. Pretoria Portland Cement Company South Africa 22.A. Companhia Siderurgical National S.com.S.com Chettinad Cement Corporation Limited . Eagle Materials Inc U.S.S. Heidelberg Cement Company Germany 16. Source: industry in India www.A 9. Anhui Conch Cement Company China 5. www.A 17. China National Cement Materials Group Corporation China 10. Aditya Birla Group-Grasim India 2. Lafarge India 18. Arabian Cement Company Egypt 6. Armenia 8. construction. coal and power.com Year of establishment 1936 3. Ambuja Cements Limited Head quarters Gujarat Web site www. Portland blast furnace slag Portland cement (PBFSPC). ACC Limited Head quarters Maharashtra Web site www. transportation. They are produce strictly as per the Bureau of Indian standards (BIS) specifications and their quality is comparable with the best in the world.acclimited. Andhra Cements Ltd Head quarters Andhra Pradesh Web site www. white cement.Paavai Engineering College 2.NO Name of the company Details of the company Year of establishment 1994 1.andhracements. Portland pozzoland cement (PPC). S.. The Indian cement industry is the second largest producer of quality cement. The industry occupies an important place in the national economy because of its strong linkage to other sectors such as. sulfate resistance Portland cement (SRPC). The cement industry is also one of the major contributors to the exchequer by way of indirect taxes.ambujacement. etc. ordinary Portland cement (OPC).com Year of establishment 1981 2.1.2 Cement Industry in India The cement industry in India has undergone a major shift over the last 6 years. Indian cement industry is engaged in the production of several varieties of cement such as.com Chettinad Cement Corporation Limited . chettinadcement.com Year of establishment 1919 7. Head quarters Tamil Nadu Limited Web site www.com Year of establishment 1951 Dalmia Cement (Bharat) 10.binani.Paavai Engineering College Year of establishment 1999 4. Bheema Cements Ltd Head quarters Andhra Pradesh Web site www.grasim.com Year of establishment 1978 5.burnpurcement.bheemacement. Head quarters Tamil Nadu Limited Web site www.com Year of establishment 1996 6.com Year of establishment 1962 Chettinad Cement Corporation 9. Binani Cement Ltd Head quarters West Bengal Web site www.barakcement.com Year of establishment 1986 8. Barak Valley Cements Ltd Head quarters Assam Web site www.com Chettinad Cement Corporation Limited .dalmiacement. Burnpur Cement Ltd Head quarters West Bengal Web site www. Birla Corporation Limited Head quarters West Bengal Web site www. hil. Grasim Industries Limited Head quarters Madhya Pradesh Web site www.indianhumepipe.com Year of establishment 1994 18.deccancem. Heidelberg Cement India Ltd Head quarters Karnataka Web site www.in Year of establishment 1962 Indian Hume Pipe Company 17.com Year of establishment 1958 15. K. Cement Limited Head quarters Uttar Pradesh Web site www. Head quarters Maharashtra Ltd Web site www.mycemco.com Year of establishment 1948 13.com Chettinad Cement Corporation Limited .jkcement. J.everestind. Deccan Cements Ltd Head quarters Andhra Pradesh Web site www.Paavai Engineering College Year of establishment 1979 11. Hyderabad Industries Ltd Head quarters Andhra Pradesh Web site www. Everest Industries Ltd Head quarters Maharashtra Web site www. Gujarat Sidhee Cement Ltd Head quarters Gujarat Web site www.com Year of establishment 1946 16.com Year of establishment 1973 14.grasim.com Year of establishment 1934 12.gujaratsidhee. com Year of establishment 1979 25. Mangalam Cement Ltd Head quarters Rajasthan Web site www.com Year of establishment 1983 26. Kalyanpur Cements Ltd Head quarters West Bengal Web site www.nclind. JK Lakshmi Cement Ltd Head quarters Rajasthan Web site www.com Year of establishment 1919 22.com Year of establishment 1937 20.madrascements.nirmancements. Kesoram Industries Ltd Head quarters West Bengal Web site www.com Chettinad Cement Corporation Limited .kesocorp.com Year of establishment 1954 23. Katwa Cements Ltd Head quarters Karnataka Web site www. NCL Industries Ltd Head quarters Andhra Pradesh Web site www.mangalamcement.Paavai Engineering College Year of establishment 1938 19. Nirman Cements Ltd Head quarters Bihar Web site www.com Year of establishment 1976 24.com Year of establishment 1993 21.jklcem.kalyancemenet.katwagroup. Madras Cements Limited Head quarters Tamil Nadu Web site www. com Year of establishment 1956 34.panyamcements.in Year of establishment 1991 32.sagarcements.Paavai Engineering College Year of establishment 1949 27.com Chettinad Cement Corporation Limited . Head quarters Andhra Pradesh Inds Ltd Web site www.in Year of establishment 1955 Panyam Cements & Mineral 28.com Year of establishment 1992 29.ocl.rosezinc.prismcement. Sanghi Industries Ltd Head quarters Andhra Pradesh Web site www. OCL India Ltd Head quarters Orissa Web site www.sainikcem.saurashtra. Rose Zinc Ltd Head quarters Rajasthan Web site www. Prism Cement Ltd Head quarters Andhra Pradesh Web site www. Sainik Cement Inds. Ltd Head quarters Delhi Web site www. Sagar Cements Ltd Head quarters Andhra Pradesh Web site www.com Year of establishment 1990 30.in Year of establishment 1985 33.sanghicement.com Year of establishment 1981 31. Saurashtra Cement Ltd Head quarters Gujarat Web site www. Sri Vasavi Inds. Somani Cement Company Ltd Web site www. Ltd Head quarters Andhra Pradesh Web site www.com Year of establishment 1946 41.chakracement.com Year of establishment 1983 Head quarters Andhra Pradesh 37.stresscrete.com Year of establishment 1983 Shree Digvijay Cement 36. Head quarters Gujarat Company Ltd Web site www.com Year of establishment 1985 38.shivacement.srivasavi. Sri Chakra Cements Ltd Head quarters Andhra Pradesh Web site www.digvijaycement. The India cements Ltd Head quarters Tamil Nadu Web site www.in Chettinad Cement Corporation Limited .anjanicement.com Year of establishment 1983 40.com Year of establishment 1981 39.Paavai Engineering College Year of establishment 1985 35. Shiva Cement Ltd Head quarters Orissa Web site www. Stresscrete India Ltd Head quarters Maharashtra Web site www.ramcocement. Udaipur Cement Works Ltd Head quarters Rajasthan Web site www.zuaricement. Zuari cement corporation Ltd Head quarters Andhra Pradesh Web site www. UltraTech Cement Limited Head quarters Maharashtra Web site www.com Year of establishment 1986 44.shine.com Source: www. Visaka industries Ltd Head quarters Andhra Pradesh Web site www.com.com Year of establishment 1981 45.com.com Year of establishment 2000 43.org Year of establishment 1985 46.google.indiacatalog.visaka.vinaycements.udaipurcement.com Chettinad Cement Corporation Limited .Paavai Engineering College Year of establishment 1993 42. Vinaycements Ltd Head quarters Assam Web site www. www. info.ultratechcement. No Name of the company Details Year of 1962 establishment Chettinad Cement Corporation Corporate office Chennai 1 Limited Karur. Brand name Coromandel cement. Plant Places Sangakiri. Chettinad Cement Corporation Limited . These. Dhindukal. Alangulam. Alangulam cement works. virudhunagar districts. 2 The India cements Ltd Ramanathapuram. The following table shows the details of cement companies in districts of Tamilnadu. The Tamilnadu is the state which has produces the quality cement in India. 1.Paavai Engineering College 2. Ariyalur. The Tamilnadu government was formed a company name is “Tamilnadu cement corporation limited (TANCEM) in the February 1976 as public limited company. Sankar cement. The TANCEM was formed two cement plants in Tamilnadu. Plant Places Ariyalur Brand name Chettinad. S. Ariyalur. perambalur districts. Year of 1946 establishment Corporate office Chennai. Ariylur cement works.1.3 Cement Industry in Tamilnadu The cement industry of India hopes the most in Tamilnadu. These. 2. ask. en.com Chettinad Cement Corporation Limited . Tamilnadu cements corporation 4 Ltd Plant place Ariyalur. Source: www.madurai. 5 Janathacem industries limited Plant place Rajapalayam.com.indiacatalog. www. Brand name Ram co cement.Paavai Engineering College Year of 1950 establishment 3 Madras cement Ltd Corporate office Chennai. Janatha cement. Plant place Ariyalur. Brand name Arasu cement Year of 1976 establishment Corporate office Madurai. agsar Brand name cement.com. Year of 1979 establishment Corporate office Chennai (Govt).wikipedia. They are used those cement for their own company use such as. SAVE AND SERVE” is the very thought of our founder. In 1912 took birth the House of Chettinad through a visionary idealist. Ariyalur cement works. Rajah Sir Muthiah Chettiar and grandson Dr. The house of Chettinad reached new heights with generations of hard work. Chettinad house pvt ltd. dedications and remains the stamp of quality. 1.000 tons of cement per year. 2. Rajah Sir Annamalai Chettiar who believed in Social Transformation through business. Ariyalur district. Chettinad Cement Corporation Limited . 2. 3.1.2 COMPANY PROFILE History of the company The history of the group house of chettinad is linked with the 9 decades old saga. MAM. Karur is the head company in Chettinad cement companies. born entrepreneur Dr. Ramaswamy. Chettinad builders pvt ltd. pragmatic and visionary leaderships. his companies providing the stimulus for Industrial Growth and conceived business as a means of improving the living standards of people. 2. The founder of the House of Chettinad envisioned. Dr. They are produced 5.4 Cement Company in Karur District Chettinad Cement Corporation limited. Chettinad group of companies. The corporate credo of the House of Chettinad “STRIVE. The Chettinad cement work plants other than karur district.00. Karikalini cement works.Paavai Engineering College 2. IN order to continue fulfilling his dreams and aspirations. Dhindukal district. integrity and reliability under the versatile. The Chettinad cement corporation limited. To reach greater heights and the reins were taken over by equally visionary businessmen his son. karur is the one of most popular cement manufacturer in Tamilnadu. 1. plantation. The group aims to broaden its horizons and reach and the zenith in this millennium under the yond. It is a matter of great pride and satisfaction that the group finds worldwide patronage and earns precious foreign exchange for the country. logistics. Chettinad Cement Corporation Limited . dynamic. Education. power generation. sports management. The future of the companies in the house of chettinad is based on the time tested and proved guidelines of total customer orientation. services (construction Transports. Quartz. we remain stead fast forever. literature. Steel fabrication. Silica. able leadership of Mr. technology in the service of man and business as an instrument of social service. farms. a 8500 million business group has ventured and diversified in varying fields including manufacturing (Cement.Paavai Engineering College Present position of the company Today. enthusiastic. Grits). To these timeless truths. Clearing and forwarding) Trading. art and music fields have also been contributed vastly. Ship management and stevedoring. MAMR Muthiah. VIJAYARAGRAN&CO M/S V.S.S. KARIKKALI.P. ARIYALORE.M. 5th Floor. Rani Seethai Hall.PARI Dr. Telephone No: +91-44-28292727 Fax No : +91-44-28291594 e-mail : [email protected]. IAS (TIIC NOMINEE) COMPANY SECRETARY : SRI.PRABHAKARA RAO.M.600 006.com Chettinad Cement Corporation Limited .SOUNDARARAJAN&CO M/S KRISHAAN &CO REGISTERED OFFICE : Chettinad Cement Corporation Ltd.GANAPATHY&C.chettinad. 603 Anna Salai.A.B.SP. Chennai .HARIHARAN TYPE : PUBLIC CO-SECRETARY : SRI.RAMANATHAN PALANIAPPAN SRI.A.M. WEBSITE : www.com PRODUCTION PLANTS : PULIYUR.PALANIAPPAN SRI.M.S.MUTHAIAH STARTED : 1962 DIRECTORS : SRI.R.KRISHNA MOORTHY SRI.S.T.HARIHARAN AUDITORS : M/S.Paavai Engineering College Management of Chettinad Cement Corporation Limited CHAIRMAN : MR.K.RAMASWAMY MD : SRI. SAVE AND SERVE. giving a silky finished look. devoid of hair line cracks and giving excellent appearance to the building. To became a vibrant learning organization by building skills and competitiveness of employees for growth. Rajah sir Annamalai Chettiar STRIVE. Sulphur Resistant Cement: Finds applications in the construction activity in the coastal areas to save from corrosiveness due to salty environment. Chettinad Cement Corporation Limited . Product profile of Chettinad Cement Corporation Ltd. The nature ethics and style of business believe that nothing can supplement the idealism which motivates the business we fall back on the time tested. Chettinad Grade 43: Multipurpose cement. suitable for plastering works.Paavai Engineering College VISION With almost a century of continuous growth and prosperity behind us we envisage our future as another opportunity to which greater heights and to perfect the art of perfectionism upholding the vision of our founder Dr. The harness technology to its full potential in a safe & clear environment in the entire business cycle & integrate quality with continuous improvement. Chettinad PPC: A finely blended cement. Chettinad Grade 53: Superior finely ground cement. providing very fine result for plastering work. For RCC applications laser controlled manufacturing would yield best result. To be the best and most respectable corporate citizen. MISSION To achieve & sustain cost leadership in the cement market. Principles of total customers orientation technology in service of man and business as an instrument of social service to this timeless truth we remind steady fast forever. suitable for plastering and binding. Pavithram: Unique cement manufactured at Puliyur works having high quality for special concrete applications. Paavai Engineering College Organizational chart of Chettinad Cement Corporation Ltd. Chairman Managing Director Board of directors President Vice president Senior general manager Additional General Manager Chettinad Cement Corporation Limited . Paavai Engineering College Deputy General Manager Senior Manger Senior Assistance Manager Supervisor Sales Officer Chief Security Officer Vigilance Officer Accounts Officer Junior Officers Chettinad Cement Corporation Limited . Stacker and Reclaimer.Paavai Engineering College MANUFACTURING DETAILS Mines-Puliyur Works Limestone is sourced from our mines at palayam which is located 40kms from the factory. fuels and additives. The mined limestone is then crushed through primary and secondary crusher. Three numbers of separate stacker-reclaimer are available with truck tipplers for proper stacking and Reclaiming of corrective raw materials. The mines are fully mechanized and have also a terminator for mechanized breaking of individual boulders. Chettinad Cement Corporation Limited . Stacker and Reclaimer-Puliyur Works The crushed limestone is then sent through the X-Ray analyzer and approved for further process only on meeting quality standards backbone of the quality control. The Crusher is located at Mines and crushed limestone is transported by long belt conveyors to factory.Karikkali works The entire quantity of crushed limestone passes through the online cross belt analyzers’ and is stacked at the pile in the factory. Mines-Karikkali works Limestone Mines are located at about 3 kms. The mines are equipped with the latest machinery and technology including for sequential blasting. coal mill and cement mill. Stacker Reclaimers help to achieve high degree of stacking and ensure maximum level of consistency for the input materials to raw mill. from the factory. Karikkali works Pre-stacked limestone of stockpile is ground in the VRM along with corrective materials with required ratios are made to produce raw meal and that is stored in Blending cum Storage Silo. Coal fired burner (Controlled through latest solid & low feeder) is used to heat the air to 1400°c and is fed from one end of the kiln. From the loesche mill the raw material is the taken to two silos to produce Varity of cement. Chettinad Cement Corporation Limited . to give fine blended raw material.Paavai Engineering College Raw Mill-Puliyur Works The limestone from the reclaimed is mixed with additive of bauxite and Iron ore and transported to the vertical roller mill through weigh feeders (which control the additive addition). Kiln-Puliyur Works The finely grounded blended raw material is sent to a five stage kiln.Karikkali works Raw meal extracted from silo is fed to the kiln where it is sintered at about 1400o C to clinker. Kiln is a key process in the manufacture of cement where the calcinations & chemical reaction take place. Raw Mill. The mix passes through the cross belt analyzers which analyze the mix chemistry and solve the mix ratio every minute to have very good consistency in the raw mix. Clinker cooler with CIS and CFG for maximum heat recuperation and the cooled clinker is transported to a storage silo. This process is called preprocessing which consists of a five stage suspension heaters with precalciner. the kiln and the clinker cooler. The operator takes corrective steps on viewing any deviation. There are separate hoppers with weigh feeders for continuous and regulated addition of each raw material. The data accusation and control center meticulously monitor the entire process including the temperature. The loesche-German make vertical roller mill is similar in principle to the tilting grinder with gigantic roller and operated by the hydraulic system. Kiln. Packing House . Japan.Paavai Engineering College Cement Mill-Puliyur Works The clinker is then ground. etc.Puliyur woks The four automatic packing machines have been installed. together they have the capacity to deliver 4800 tons per day of packed cement. Chettinad Cement Corporation Limited .Karikkali works There are 2 nos.Karikkali works Finally. laser practical size analyzer is used to monitor fineness of the cement for yielding very good quality cement. the additive is added. To maintain quality of various types/grades of cement. Packing House . These packing equipments are very accurate and any fault can be rectified as each bag is verified before the next is filled. Quality of final product is monitored and controlled every hour by testing samples in the XRF analyzer. These are also cross- checked by the Electronic weighing scale used to note the load carried by the Lorries. depending upon the grade. For all grades of cement 5% gypsum is added to control setting of cement we use Japanese technology in fine grinding with vertical roller mill from anode Kobe. there are separate hoppers with weigh feeders for the addition of fly ash. gypsum. Final products are stored in cement silos. Packed cement is loaded into trucks/wagons with automatic loading machines. grinding is done in OK Vertical Roller Mill for optical particle size distribution and less power consumption with excellent ease of operation for feeding. grinding and classification. of Electronic Rot packer which automatically pack cement in bags. Cement Mill. each with a capacity of 150 tons/hour. Paavai Engineering College WET PROCESS TECHNOLOGY Calcareous Material Argilseeous Limestone Material Clay Crushing Water Washing Storage Tank Storage Tank Mixing IN Correct Production Slurry Formation Correction Basin Pumping Rotary Kiln Coal Dust Chettinad Cement Corporation Limited . Paavai Engineering College Formation Of Clinker Clinker Cooler Grinding In Ball and Tube Gyp Mill sum Storage In silos Weighing and packaging in Bags Distribution Chettinad Cement Corporation Limited . Paavai Engineering College DRY PROCESS TECHNOLOGY Calcareous Material Argilseeous Limestone Material Clay Crushing Crushin g Grinding Grinding Storag Storage e Mixing In Correct Proportion Storage of raw materials Coal Dust Rotary Kiln Formation of Clinker Chettinad Cement Corporation Limited . Paavai Engineering College Clinker Cooler Gyp Grinding In Ball and Tube sum Mill Storage in Silos Weighing and Packing in bags Distribution Chettinad Cement Corporation Limited . Paavai Engineering College ACHIEVEMENTS OF CHETTINAD CEMENT CORPORATION LTD. S.No AWARDS YEAR National Safety Award (for outstanding performance in Industrial Safety in 1976 1 achieving lowest frequency rate in Industry) Runners up Highest % reduction in frequency rate 1977 2 Merit Awards from Regional Directorate of Workers Education 1972 3 Tamil Nadu Film Arts Association, Chennai Shield 1978 National Productivity Award (Best Productivity Performance in Cement Industry issued by NPC) 1985 Second Best 1986 4 Best 1995 Best 1996 Second Best 1997 National Safety Award (Mines)-(for lowest injury frequency rate Metal Mines Mechanized Open Cast). 1986 5 Longest Accident Free Period. 1986 Best performance of the year. 1989 Conservationist of the year (for outstanding progress in the field of 6 Conservation of Energy, Metal Components & Machinery) 1987 NCBM National Awards (Improvement in Energy Performance). Second Best 1994 7 Best 1995 Best 1998 TNEB Energy Conservation Award - (One among the 15 Energy Efficient 8 H.T. Industries of 2000 KVA) 1998 NCBM National Award 9 Second Best for Energy Efficiency Performance 1998 Source: Annual report of Chettinad Cement Corporation Limited Chettinad Cement Corporation Limited Paavai Engineering College MILESTONES OF CHETTINAD CEMENT CORPORATION LIMITED Sl. No. MILESTONES YEAR 0.4 MTPA cement production capacity with wet process plant installed at 1 1967 Puliyur. Modernized into dry process plant to a capacity of 0.8 MTPA with a kiln 2 capacity of 2000 TPD commissioned with modern vertical roller mills for 1989 fuel & limestone grinding. 3 2 Nos. of 5.4 MVA Capacity WARTSILA DG set installed. 1990 66 Nos. of wind electric Generator of total capacity 17.3 Mw installed at 4 1994 Poolavadi Udumaplet Taluk. 5 ISO – 9002 Certificate received. 1995 6 Stacker & Re-claimer for Limestone installed. 1996 7 Belt Elevator for Raw mill and Kiln feed installed. 1996 A) Impact Crusher for lime stone crushing at mines installed. 8 1997 B) Bag filter for coal mill grinding system. Vertical roller mill for cement grinding installed. Additional ESP installed 9 1998 for Kiln/ Raw mill to handle excess process gases. CIS/CFG Cooler installed. Low pressure cyclone installed. 10 Latest Technology LV-Tech classifier installed in Raw Mill. The plant 2000 capacity increased to 1.2 MTPA cement. Green field Cement plant with capacity of 0.9 MTPA was commissioned at 11 2001 Karikkali. 12 Rock breaker (Terminator) installed in mines. 2001 13 ISO 14001:2004 is implemented. 2003 14 Environment Management Service Certificate option. 2004 1 No. 15MW Coal based Captive Power Plant commissioned in 12 Months 15 2004 at Karikkali. 16 Fly Ash Silo construction work completed at Puliyur and Karikkali. 2005 Chettinad Cement Corporation Limited Paavai Engineering College 17 Roller press with ball mill for cement grinding with capacity 0.7 MTPA installed at Karikkali. 2006 Vertical roller mill for cement grinding installed. Additional ESP installed 18 2006 for Kiln/ Raw mill to handle excess process gases. Karikkali plant capacity increased to 2.0 MTPA by increasing of blended 19 2007 cement production. Bag House installed in Raw Mill/Kiln Circuit in addition to the existing ESP 20 2007 at Puliyur. Energy dispersive X-Ray specto meter was put into service for increasing 21 2007 the output and economical mines operation & conservation of minerals. Advance Research laboratories, Switzerland make X-Ray Spectrometer – 22 Sequential type was commissioned for augmenting clinker production and 2007 its quality. Seethainagar Mines crusher capacity was upgraded for supply of 40% 23 2007 Karikkali plant requirement of limestone. Coal based 15 MW capacity CPP was commissioned during Feb-2008 at 24 2008 Puliyur Works. Automation & control sections PLC's OS software up gradation and PLC's 25 2008 capacity. KHD make Burner Management System for kiln operation to improve 26 2008 quality of clinker and to save thermal energy. Coal based 2 x 15 MW capacity CPP was commissioned during Sep-2008 at 27 2008 Ariyalur. Green field Cement plant with capacity 2.75 MTPA was commissioned 28 2008 during Dec-2008 at Ariyalur. Video conferencing facility was commissioned between Puliyur, Karikkali, 29 Ariyalur and Head Office for more effective and faster communications and 2008 project monitoring. Chettinad Cement Corporation Limited 5 MTPA was commissioned 33 at Karikkali in March 2011 along with coal based 30MW captive power 2011 plant within the same premises Work is under progress for a new Green field production line of 2. 15 2010 MW coal based captive power plants commissioned in 18 months at Ariyalur Chettinad Cement Technical team rated No1 by FLS Denmark at Ariyalur. Coal based 1 x 15 MW capacity CPP was commissioned during Jan- 2010 Erection and Commissioning of 2 Cement Plants in World Record time at ariyalur – 30 months from Bhoomi Pooja to commissioning highest 31 production capacity for cement in a single location at Ariyalur Three No. of 30MW Coal based captive power plant in Kallur 34 2011 Village.75 MTPA was commissioned at 30 2009 Ariyalur during October-2009. Chettinad Cement Corporation Limited . Roller press with ball mill for cement grinding with capacity 0.Paavai Engineering College Brown field Cement plant with capacity 2. Chincholi Taluk and Gulburga Dist of Karnataka state and expected to be commissioned in year 2012. Brown field Cement Plant with capacity of 2.5 MTPA cement with 1 No.5 million 32 2010 commissioned during February -2010 at Puliyur. Paavai Engineering College CHAPTER-III CONCEPTUAL AND THEORITICAL FRAME WORK Chettinad Cement Corporation Limited . so as to judge the stock level and control methods of the firm. The stock evaluation helps to understand how best the organization is functioning with good stock control.1. EOQ ANALYSIS The objectives of inventory turnover analysis EOQ analysis is to provide information about the stock level and control when purchase of raw materials of an enterprise that is useful to a wide range of purchasing power of raw materials. We have discussed in the previous paragraphs the utility of the components of inventory turnover and EOQ. CONCEPTUAL AND THEORITICAL FRAME WORK OF INVENTORY MANAGMENT Inventory management is a process of evaluating and controlling method for inventory or stock level of the company. The purpose of inventory management is to diagnose the information contained in the stock book of the company. Chettinad Cement Corporation Limited . The analytical tools generally available to an analyst for this purpose are as follows.Paavai Engineering College 3. o To find out the efficiency in utilization of stock materials to produce the goods. The analysis and interpretation of inventory management is essential to bring out the stock needed. Inventory turnover analysis EOQ analysis OBJECTIVES OF INVENTORY TURNOVER ANALYSIS. Later we will us discussing how they are made use of by stock department o To study the stock book of the company o To evaluate the stock position of the company. The inventory management is an attempt to determine the stock and meaning of the stock book statement data so that forecast may be made of the future cost control of the company. To differentiates the investment with EOQ and invest without EOQ for purchasing of the raw material INVENTORY TURNOVER RATIOS Inventory turnover ratio A ratio showing how many times a company's inventory is sold and replaced over a period. W. it means that interest is calculated every six months.Paavai Engineering College USES OF INVENTORY TURNOVER ANALYSIS.The most economical quantity of a product that should be purchased at one time. The framework used to determine this order quantity is also known as Wilson EOQ Model. The EOQ is based on all associated costs for ordering and maintaining the product. If you have two conversion periods. The main objectives of a inventory turnover analysis are to assess The present and future stock capacity of a concern. The model was developed by F. The inventory conversion period for calculate the interest for credit sales to their agents ECONOMIC ORDER QUANTITY Economic order quantity is that level of inventory that minimizes the total of inventory holding cost and ordering cost. Harris in 1913. EOQ refers to the size of the order which gives maximum economy in punches of materials. To give corrective solution for the inventory problem. Inventory turnover period How often interest is calculated and added on to your investment. 2 Ao EOQ = √ C1 Where A = Annual usage in unit O = Ordering cost C1 = Carriying cost Chettinad Cement Corporation Limited . EOQ ANALYSIS It is helpful in assessing the stock position and productivity position of a concern. Finance India Dec 2003 R. But with the acceptance of Norseman committee recommendation. it has been found the liquidity position and working capital positions were favorable and good during period of study.Dharmaraj Indian journal of finance volume4 Allen and Carolinian (2003) Chettinad Cement Corporation Limited .2 REVIEW OF LITERATURE Bharathi pathak 1991 The bulk of the banking business in the country is in the public sector comprising the state bank of India and its seven associated banks and twenty nationalized commercial banks till 1991. Hamsalakshmi-M. Hamsalakshmi-M. Dr R.Manicham 2000 “The study. competition has been injected into the banking industry in two forms. no doubt.Manicham. but it by no means. These Bank obviously. R. Regarding return on investment and return on equity was proved that the overall profitability position of the software companies had been increasing at a moderate way. efficiency in management of fixed assets and total assets must be increased. . It closest competitor was ICICI Bank.Dharmaraj 2003 ”The study airtical “positing in Indian management industry ’’ have concluded that for the last five year. Finance India Sep2 2009 Dr R. have to focus more improving parameters like credit quality and cost control for the emerge as the top performance. The study has been found that HDFC Bank emerged as a leader in this financial analysis of the year ended 2000-01. He says that this increased growth is due to the increasing cash flows among innovative young companies through India. Regarding turnover ratio. there has been proliferation of international and domestic providence of mutual funds. depressing. Financial performance of the other three.Bharathi pathak. the Indian banking industry was operating in a highly regulated and protected regime.Paavai Engineering College 3. lagged behind them. Dr Harish kumar single. 2008) J R Raiyani.B.Kavitha Chavvali. Mathew T.The icfai journal of inventory management (vol vii Feb. No 2 Feb. 2009) Dr.Jones and Maurice ousted (2007) revised and evaluated pre world war ii current date for countries by treating gold follows on a continuous basis. Indian journal of inventory (vol 5 No: 2 Feb 2011) Chettinad Cement Corporation Limited . J R Raiyani 2009 During the periods of high inflation depending on conventional accounting wisdom.Kavitha Chavvali 2009 Inventory analysis of gold exchange trade funds. During the study period.Prasanna 2009 Stock performance Aitkin 1997 the external effect foreign direct investment on export with example of Bangladesh where entry of a koala multinational in garment exports led establishment of a member of domestic export firms creating the country’s largest export industry. Inters income to working funds also had a negative association with interest coverage ratio and the non performing to net advance was negatively correlated with interest coverage ratio. Awedh 2005 defend that inflator does not have really an effect on the profitability measured by return on equity of foreign banks exerting in Lebanon. May results in firm’s financial information losing its meaning and creation of unrealistic expectation among information users. The historical data of saving and investment was taken over a time period of 1850.1945. It was observed that the return on net worth had negative correlation with the debt equity ratio. Dr.Bhatasna. The infaciS university journal of inventory research (vol viii. Indian journal of inventory (vol 3 No: 2 dec 2009) N. Indian journal of inventory (vol 5 No: 1 Jan 2008) Dr.R. In the same way.Prasanna. the author steers that the level of inflation affect more than the return on assets of Lebanese bank than foreign banks in Lebanon. N.Paavai Engineering College Dr Harish kumar 2008 A capital adequacy ratio was constant over a period of time. monetary market rate. Indian Journal of inventory vol: 5 No: 1 Jan 2011 Chettinad Cement Corporation Limited . Indian Journal of inventory vol: 4 No: 2 Feb. Among these factors one can equate the growth rate of gross domestic product. It was found that master gain performed better according to Jensen and trey nor measures and basis of sharps ratio. Dr Sushil kumar Mehta.Paavai Engineering College Dr Sushil kumar Mehta 2010 The financial performance mutual funds schemes. Monika uppal 2010 Financial performance factors a survey of the literature shows that the foreign bank performance is affected by factors like the economic and financial environment. (Williams 1998). Jayadew (1996) attempted of evaluate the performance of two growth oriented mutual funds on the basis of monthly return. inflation rate and foreign exchange rate. 2010 Monika uppal. Paavai Engineering College CHAPTER-IV ANALYSIS OF INVENTORY MANAGEMENT Chettinad Cement Corporation Limited . 1 LEVEL OF INVENTORY Chettinad Cement Corporation Limited .Paavai Engineering College ANALYSIS PART-1 RATIO ANALYSIS (INVENTORY) TABLE .1.4. 26 18775.46 18611.05 2777.40 TOTAL(clinker) 5551.02 18351.33 8616.70 1292.86 2 Work in process 5386.No Particulars 2006-07 2007-08 2008-09 2009-10 2010-11 Raw materials Lime stone 3330.1.36 56084.44 2816.21 11109.54 19416.59 19216.06 overall inventory level position for the five years is satisfactory.77 42331.09 Source: 3 Annual report Finished of Chettinad Cement goods Corporation 6251.02 18516.50 (stacker 60 Per cent) 1 Iron ore 1387.36 26384.11 Total 17189.55 Limited14522.83 2154.80 5169.96 (stacker 25 Per cent) Clay ash (stacker 15 Per cent) 832. CHART .26 56803.1 LEVEL OF INVENTORY Chettinad Cement Corporation Limited .4. The S.76 4629.11 3496.76 11265.32 9316.74 13822.10 4693.47 2098.Paavai Engineering College Qty in thousand tones The inventory level was found to be increased trend from 2006-2007 to 2010-2011.44 13937.86 8392.48 8451. Paavai Engineering College INVENTORY LEVEL OF THE COMPANY(in thousand tons) 25000 20000 15000 10000 5000 0 2006-07 2007-08 2008-09 2009-10 2010-11 Raw materials Work in process Finished goods INVENTORY TURNOVER RARIO Chettinad Cement Corporation Limited . 5 4.1. The present value of inventory turnover ratio is good.No Year Average stock (in tones) Inventory turnover ratio (` in lakhs) 1 2006-07 2663028 487428 5.24 per cent 5 2010-11 4521886 822538.2 Chettinad Cement Corporation Limited .46 per cent 2 2007-08 2844494 503184 5.4.5 5.1. Cost of sales Inventory turnover ratio = Average stock Cost of sales = sales − Gross profit Opening stock + Closing stock Average stock = 2 TABLE .4. The inventory turnover ratio measures the number of times a company sells its inventory during the year. CHART .Paavai Engineering College .50 per cent Source: Annual reports of Chettinad Cement Corporation Limited The inventory turnover ratio was high in the year 2006-07 after that 2007-08 the inventory turnover ratio was decreased.2 INVENTORY TURNOVER RARIO Cost of goods sold S.5 3.65 per cent 3 2008-09 3094850 819401.78 per cent 4 2009-10 4010580 945491. 77696404 3 2 1 0 2006-07 2007-08 2008-09 2009-10 2010-11 INVENTORY CONVERSION PERIOD Chettinad Cement Corporation Limited .Paavai Engineering College INVENTORY TURNOVER RATIO 6 5.241793818 4 3.652989761 5.49747641 5 4.463428445 5. 3 Chettinad Cement Corporation Limited . The company wants to concentrates with its inventory conversion period.78 per cent 96 4 2009-10 365 4. sell it. manufactured it.1. No.No Year No.Paavai Engineering College The inventory conversion period is the time required to obtain materials for a product.24 per cent 86 5 2010-11 365 5. of days Inventory turnover ratio period (in days) 1 2006-07 365 5.1.3 INVENTORY CONVERSION PERIOD Inventory conversion S. of days in the year Inventory conversion period = Inventory turnover ratio TABLE – 4.65 per cent 64 3 2008-09 365 3.50 per cent 65 Source: Annual reports of Chettinad Cement Corporation Limited The inventory conversion period is normally indicates the wealth of the company. CHART – 4.46 per cent 66 2 2007-08 366 5. Paavai Engineering College INVENTORY CONVERSION PERIOD 120 100 96 86 80 66 65 64 60 40 20 0 2006-07 2007-08 2008-09 2009-10 2010-11 Chettinad Cement Corporation Limited . Paavai Engineering College ANALYSIS PART-2 EOQ ANALYSIS TABLE-4.1 EOQ ANALYSIS FOR THE YEAR 2006-07 Chettinad Cement Corporation Limited .2. So the company saved ` 169432 in the year 2006-07. CHART-4.5 65 1230 81794 138615 56821 Lime Stones 15000 40 1.2.5 150 748 113322 116173 2851 Source: Annual report of Chettinad Cement Corporation Limited The company’s annual requirement for the year 2006-07 is 101000 tons of raw materials. When the same in without investing EOQ is ` 882551.5 1.75 153 716 110801 133927 23136 Gypsum 13500 35 1.5 1.25 144 869 126223 130688 4465 Bauxite 11500 36. They using investment with EOQ spent ` 787168.25 144 980 142345 145225 2880 Clay Ash 14000 42 2 144 767 111982 135915 23933 Sulphur 13000 34.Paavai Engineering College Total Total Saving Annual Item O C P EOQ investment investment inventory requirement with EOQ without EOQ cost Iron Ore 31500 36 1.1 Chettinad Cement Corporation Limited . 2.2 Chettinad Cement Corporation Limited .Paavai Engineering College EOQ ANALYSIS FOR THE YEAR 2006-07 160000 145225 142345 138615 130688 135915 133927 140000 126223 116173 120000 111982 110801 113322 100000 81794 80000 60000 40000 20000 0 Iron Ore Lime Stones Clay Ash Sulphur Gypsum Bauxite Total investment with EOQ Total investment without EOQ TABLE-4. They using investment with EOQ spent ` 590000.5 163 808 132916 153304 20388 Gypsum 12500 36 2 154 671 104676 153304 20388 Bauxite 11000 37 2. So the company saved ` 195739 in the year 2007-08.Paavai Engineering College EOQ ANALYSIS FOR THE YEAR 2007-08 Total Total Annual investment Saving Item O C P EOQ investment requirement without inventory cost with EOQ EOQ Iron Ore 33500 35 1. Chettinad Cement Corporation Limited .5 75 1250 95626 169675 74049 Lime Stones 13500 41 2 154 744 116064 140115 24051 Clay Ash 16500 55 1.5 160 571 92787 118752 25965 Source: Annual report of Chettinad Cement Corporation Limited The company’s annual requirement for the year 2007-08 is 103700 tons of raw materials.55 154 1100 171050 171050 0 Sulphur 14000 35 1. When the same in without investing EOQ is ` 921215. 2.Paavai Engineering College CHART-4.3 EOQ ANALYSIS FOR THE YEAR 2007-08 180000 171050 169675 171050 160000 153304 153304 140115 140000 132916 116064 118752 120000 104676 95626 100000 92787 80000 60000 40000 20000 0 Iron Ore Lime Stones Clay Ash Sulphur Gypsum Bauxite Total investment with EOQ Total investment without EOQ Chettinad Cement Corporation Limited . They using investment with EOQ spent ` 68646.5 165 648 108540 166775 58235 Bauxite 11200 36. Chettinad Cement Corporation Limited .2. So the company saved ` 114076 in the year 2008-09.5 65 1260 83789 153905 7046 Lime Stones 13500 36 1.Paavai Engineering College TABLE-4.75 170 684 117476 128191 10715 Source: Annual report of Chettinad Cement Corporation Limited The company’s annual requirement for the year 2008-09 is 98500 tons of raw materials.5 167 805 135642 151515 15873 Clay Ash 15000 38 1.5 1.75 165 807 134567 166445 13878 Sulphur 14000 37 1.75 164 769 127462 154384 26922 Gypsum 15000 35 2. When the same in without investing EOQ is ` 800543.3 EOQ ANALYSIS FOR THE YEAR 2008-09 Total Total Saving Annual Item O C P EOQ investment investment inventory requirement with EOQ without EOQ cost Iron Ore 13500 34 1. 3 EOQ ANALYSIS FOR THE YEAR 2008-09 180000 166445 166775 160000 153905 151515 154384 135642 134567 140000 127462 128191 117476 120000 108540 100000 83789 80000 60000 40000 20000 0 Iron Ore Lime Stones Clay Ash Sulphur Gypsum Bauxite Total investment with EOQ Total investment without EOQ Chettinad Cement Corporation Limited .2.Paavai Engineering College CHART-4. Paavai Engineering College TABLE-4.2.5 175 864 152496 164575 12079 Sulphur 16000 38 1.75 174 834 146575 187161 40586 Gypsum 18000 36 2. So the company saved `2577276 in the year 2009-10. Chettinad Cement Corporation Limited . When the same in without investing EOQ is `1132819. They using investment with EOQ spent `875092.75 175 686 121938 212190 90252 Bauxite 17000 37 1 180 1122 203082 205062 1980 Source: Annual report of Chettinad Cement Corporation Limited The company’s annual requirement for the year 2009-10 is 111500 tons of raw materials.5 95 1271 123231 217605 94374 Lime Stones 12500 37 1.4 EOQ ANALYSIS FOR THE YEAR 2009-10 Total Total Annual Saving Item O C P EOQ investment investment requirement inventory cost with EOQ without EOQ Iron Ore 34000 36 1.75 174 727 127770 146226 18456 Clay Ash 14000 40 1. Paavai Engineering College CHART-4.4 EOQ ANALYSIS FOR THE YEAR 2009-10 250000 217605 212190 203082 205062 200000 187161 164575 152496 146226 146575 150000 123231 127770 121938 100000 50000 0 Iron Ore Lime Stones Clay Ash Sulphur Gypsum Bauxite Total investment with EOQ Total investment without EOQ Chettinad Cement Corporation Limited .2. They using investment with EOQ spent ` 869375.75 105 1268 135358 268736 133378 Lime Stones 13500 35 1.75 200 715 144965 242235 97270 Source: Annual report of Chettinad Cement Corporation Limited The company’s annual requirement for the year 2010-11 is 113500 tons of raw materials. When the same in without investing EOQ is ` 1244664.25 194 1043 203646 221110 17464 Bauxite 18000 39 2.25 185 608 114455 187225 72770 Gypsum 17000 40 1.5 EOQ ANALYSIS FOR THE YEAR 2010-11 Total Total Annual Saving Item O C P EOQ investment investment requirement inventory cost with EOQ without EOQ Iron Ore 38000 37 1.Paavai Engineering College TABLE-4. So the company saved ` 375289 in the year 2010-11.2. Chettinad Cement Corporation Limited .25 185 869 161852 167588 5736 Clay Ash 12000 38 3 195 551 109099 157770 48671 Sulphur 15000 40 3. 5 EOQ ANALYSIS FOR THE YEAR 2010-11 300000 268736 250000 242235 221110 203646 200000 187225 167588 161852 157770 150000 144965 135358 114455 109099 100000 50000 0 Iron Ore Lime Stones Clay Ash Sulphur Gypsum Bauxite Total investment with EOQ Total investment without EOQ Chettinad Cement Corporation Limited .Paavai Engineering College CHART-4.2. Paavai Engineering College CHAPTER-V SUMMARY OF FINDINGS. SUGGESTIONS AND CONCLUSION Chettinad Cement Corporation Limited . There is no problem in the inventory level of the Chettinad Cement Corporation Limited. For this year they followed EOQ with investment for purchase of goods. EOQ ANALYSIS In EOQ analysis for the year 2006-07 to 2010-11 is good. After those periods the inventory turnover ratio has slightly increased in the year 2010-11. In EOQ analysis for the year 2009-10 to 2010-11 is good. In inventory turnover ratio the ratios of the year has been finded as low in the years of 2008-09 and 2009-10. Chettinad Cement Corporation Limited .Paavai Engineering College 5. For this year they followed EOQ with investment for purchase of goods. In inventory conversion period is finded as good level. In this year the EOQ with investment and EOQ without investment are same. In EOQ analysis for the year 2008-09 to 2010-11 is good. the in inventory level has been increased year by yea. In EOQ analysis for the year 2007-08 to 2010-11 is good. Even though that level is quite low when compare with 2007-08. Even though they wants to keep the inventory conversion period as low.1 FINDINGS RATIO ANALYSIS (INVENTORY) In inventory level of the company. For this year they followed EOQ with investment for purchase of goods. 2 SUGGESTION RATIO ANALYSIS (INVENTORY) In inventory level of the company shows the increase of the raw materials. EOQ ANALYSIS In EOQ analysis there is no problems finded in findings for the Chettinad Cement Corporation Limited. For sales to others they allowed more days as credit to their agents. Now they use their cement which are produced in Chettinad Cement Corporation Limited for their own purpose. Even though they want to keep that situation in upcoming years also. Chettinad Cement Corporation Limited sells the 25 per cent of the cements produced. They want sell their product to outside also. 5. Chettinad Cement Corporation Limited . All years of EOQ is followed only investment with EOQ. Then only they can retain position. In inventory turnover ratio finded some problems. The inventory level of Chettinad Cement Corporation Limited is well. They want to sell that to others also then only the ratio will be increased. Then only they can retain position. Even though they want to keep that situation in upcoming years also. work- in-process and finished goods. In EOQ analysis there is no problems finded in findings for the Chettinad Cement Corporation Limited.Paavai Engineering College In EOQ analysis for the year 2010-11 to 2010-11 is good. remaining they used for own purpose. Chettinad Cement Corporation Limited . Even though they want to keep that situation in upcoming years also. Even though they want to keep that situation in upcoming years also. Then only they can retain position. even though they followed EOQ with investment. Then only they can retain position. In EOQ analysis there is no problems finded in findings for the Chettinad Cement Corporation Limited. In EOQ analysis there is no problems finded in findings for the Chettinad Cement Corporation Limited.Paavai Engineering College In EOQ analysis there is no problems finded in findings for the Chettinad Cement Corporation Limited. The EOQ was finded as same in the concept of EOQ with investment and EOQ without investment. During the year 2006-2011 from this study I concluded that organization would be efsfective inventory management. Hence the inventory management of the organization quite good.Paavai Engineering College 5. Chettinad Cement Corporation Limited . I have used a technique Economic Order Quantity Analysis named as EOQ Analysis for find out the rate with EOQ and without EOQ investment for purchasing of good in the manufacturing the cement in Chettinad Cement Corporation Limited.3 CONCLUSION The study covers the inventory management for effective inventory control. The study will be use for Chettinad Cement Corporation Limited in various ways. Paavai Engineering College BIBLIOGRAPHY Chettinad Cement Corporation Limited . reportjunction.inventoryquzz.com www.N Maheswari S.shine.com www.Paavai Engineering College BIBLIOGRAPHY BOOKS Asohok Banerjee .K Maheswari – Accounting for Management – Vikas Publishing – 2006 WEBSITES en.K Bhattacharyya Jhon Dearden – Costing for Management – Vikas Publishing – 2002 S.com www. problems and cases 4th Edition – Tata McGraw Hill – 2007 Pandikumar – Management Accounting – Excel Books – 2007 Ramachandran N Kakani Kumar Ram – Financial Acccounting For Management – Tata McGraw Hill – 2006 Robert N.K – Management Accounting : Text.com www.wikipedia.com www.google.Anthony David F.com Chettinad Cement Corporation Limited .Hawkins Kenneth A.Financial Accounting – A Managerial Emphasis – Excel Books – 2005 Collis – Business Accounting – Palgrave Macmillan – 2007 Khan MY Jain P.indiacatalog.com Info.com www.Merchant – Accounting Text and Cases – Tata McGraw Hill – 2007 S.chettinad.ask. Paavai Engineering College www.com www.yahoo.scribed.com Chettinad Cement Corporation Limited .