Acknowledgement

An individual cannot do project of this scale. I take this opportunity to express my acknowledgement and deep sense of gratitude to the individuals for rendering valuable assistance and gratitude to me. Their inputs have played a vital role in success of this project.

I express my sincere thanks to my project guide ANJALI ARORA for her generous support, constant direction and mentoring at all stages of training.

I take this opportunity to thank all dealers, customers who spared their precious time to provide me with valuable inputs for project without which it would have not been possible.

I firmly believe that there is always a scope of improvement. I welcome any suggestions for further enriching the quality of this report. An individual cannot do project of this scale.

NAME:

LOKESH BUNGLA

BBA –B&I, 3RD SEM

1ST SHIFT

1

DECLARATION

I hereby declare that the project work entitled “Employee Engagement And Corporate Governance at

Havells” submitted to Guru Gobind Singh Indraprastha University, in record of original work done

by me under the guidance of ANJALI ARORA, Trinity Institute of Professional Studies, Dwarka,

New Delhi, and this project is performed in the partial fulfillment of Bachelors of Business

Administration.

NaME:

LOKESH BUNGLA

2

Title of Project

Employee Engagement and Corporate Governance at Havells

3

INDEXChapter-1

Introduction 5

1.0 Profile of the Company…………………………………………………………… 6

1.1 Vision of the Company…………………………………………………………… 8

1.2 Mission of the Company…………………………………………………………. 10

1.3 Objective of the company………………………………………………………… 12

1.4 Major Milestones of company…..……………………………………………….. 15

1.5 About Business History………………………………………………………….… 201.6 Board of Directors…………………………………………………………………..25

Chapter-2

Brands owned By Company

Chapter-3

Financial overview Of Company

Chapter-4

Introduction to HR department

Chapter-5

Swot analysis

Chapter-6

Objectives of study 37

Chapter7

Employee Engagement 51

Chapter-8

Corporate Governance 57

4

Chapter-9

Suggestion and Recommendation

Chapter-10

Bibliography

COMPANY PROFILE

5

Havells India Ltd is a billion-dollar-plus Indian electrical

equipment company with products ranging from industrial &

domestic circuit protection switchgear, cables & wires, motors,

fans, power capacitors, compact fluorescent lamps (CFL), and

luminaries for domestic, commercial & industrial applications,

modular switches covering household, commercial and industrial

electrical needs. The company is listed on the Bombay Stock

Exchange and forms part of the BSE500, BSE CG and BSEMIDCAP stock indexes.

Havells owns global brands like Crabtree, Sylvania, Concord, Luminance, Linolite & SLI

Lighting. Havells has 91 branches / representative offices and over 8000 professionals in over 50

countries. Its seven manufacturing plants in India are located at Haridwar, Baddi, Noida,

Faridabad, Alwar, Neemrana, and 8 manufacturing plants are located across Europe, Latin

America & Africa.Havells is a name synonymous with excellence and expertise in the electrical

industry. Its 20000 strong global distribution network is prompt to service customers.

The company has acquired a number of International certifications, like BASEC, CSA, KEMA,

CB, CE, ASTA, CPA, SEMKO, SIRIUM (Malaysia), SPRING (Singapore), TSE (Turkey), SNI

(Indonesia) and EDD (Bahrain) for various products. Today, Havells and its brands have

emerged as the preferred choice of electrical products for discerning individuals and industrial

consumers both in India and abroad.

In an attempt to transform itself from an industrial product company to a consumer products

company, Havells launched consumer electrical products such as CFLs, Fans, and Modular

Switches & Luminaires. The company has been consistent in its brand promotion with

sponsorship of Cricket events like T20 World Cup, India-Australia Series and IPL Season 1 and

2. The company has also taken the initiative to reach directly to the consumers through "Havells

Galaxy" – a one stop shop for all electrical and lighting needs.  

6

Social and environmental responsibility has been at the forefront of Havells operating philosophy

and as a result the company consistently contributes to socially responsible activities. For

instance, the company is providing mid-day meal in government schools in Alwar district,

covering 15000 students per day. Besides this company has acquired land for constructing a

larger kitchen with all the modern facilities to serve freshly cooked food to 50000 students in the

area. Havells runs a mobile Medical Van, equipped with a trained doctor and necessary

medicines in the rural areas of Delhi & NCR for the very poor and needy villagers. We also set

up free medical check-up camps. In the past also, the company has generously contributed to the

society during various national calamities like the Bihar Flood, Tsunami and Kargil National

Relief Fund etc.

The essence of Havells success lies in the expertise of its fine team of professionals, strong

relationships with associates and the ability to adapt quickly and efficiently, with the vision to

always think ahead.

PRODUCTS:

1) BUILDING CIRCUIT PROTECTION

2) INDUSTRIAL CIRCUIT PROTECTION

3) MOTORS

4) CAPACITORS

5) LIGHTING

6) CFL

7) FANS

8) MODULAR PLATE SWITCHES

9) CABLES AND WIRES

10) DIGITAL DIMMING

11) BATHFITTINGS AND ACCESSORIES8

7

VISION MISSION AND VALUES OF COMPANY

8

Vision & Mission

To be a globally recognized corporation who provides best electrical & lighting solutions,

delivered by best-in-class people. To achieve our vision through fairness, business ethics, global

reach, technological expertise, building long term relationships with all our associates,

customers, partners, and employees

Values

Customer Delight: A commitment to surpassing our customer expectations.

Leadership by example. A commitment to set standards in our business and transactions

based on mutual trust.

Integrity and Transparency: A commitment to be ethical, sincere and open in our

dealings.

Pursuit of Excellence: A commitment to strive relentlessly, to constantly improve

ourselves, our teams, our services and products so as to become the best in class

9

OBJECTIVES OF COMPANY

10

MAIN OBJECTS OF THE COMPANY TO BE PURSUED ON ITS INCORPORATION

ARE:-

1. To carry on the business of manufacturing assembling, altering, exchanging, buying,

selling, importing, exporting or otherwise dealing in all types of electrical goods and

instruments including circuit breakers, HRC fuses, meters, rectifiers, converters and

alternators, current transformers, switches, switchgears, panels, electric motors,

generators, electric magnets motor control centers, power control centers, distribution

boards, rising mains, bus trunking, overhead busbar systems, feeder pillars, lighting

fixtures, fans, exhaust fan, air coolers, wiring accessories, iron clad switches, fuse

units, distribution boxes, cutouts, wires and cables all aluminum conductor and

aluminum conductor steel reinforced transformers, G.L.C. lamps, fancy shades,

heating elements, bulbs, fluorescent tubes and its accessories including chokes,

starters, switches and condensers.

2. To carry on the business of manufacturing, assembling, altering, exchanging, buying,

selling, importing exporting, and otherwise dealing in electronic and audio-visual

goods of every nature and description such as Television, Tape recorders, Radios,

Records Players, Video Sets, Stereo system, decks, loud speakers, amplifiers,

gramophones, records, tapes, watches, clocks, walkie talkies, cameras, cassettes,

transistors, assemblers and distributor, electronic flash guns, electronic digital goods,

microwave ovens, radio paging systems, computers, miniaturized circuits goods,

micro modules, intercommunications sets, microphones, Dictaphones,

telecommunication requisites, wireless/laboratory/testing equipments, electronic

consumer and domestic goods, musical and visual appliances, apparatus, instruments,

equipments and devices for amusement and entertainment, electronic goods required

in any trade, industry or manufacture such as photographic, surgical, medical films,

nautical, aeronautical, electrical defense industry and including equipments,

instruments and goods used in generation, transmission and receiving of any impulses

11

such as and sound, light, electronic and electrical impulses and all kinds of electronic

accessories, appliances, implements, components, instruments, equipments stores and

spares, spare parts, devices, contrivances, apparatus and supplies related to or

connected with the aforesaid, and all such electronic goods adapted, invented and

discovered in future.

3. To carry on business of electrical engineers and manufacture of all kinds of heavy and

light electrical machinery and equipments and apparatus for any purpose and to

install, sell, hire or otherwise deal with the same in any manner whatsoever.

4. To produce, manufacture, refine, treat, cure, process, prepare, import, export,

purchase, sell, and generally deal in all kinds of sanitary fittings and bathroom fittings

such as brass fittings, steel fittings tiles and ceramic ware.

OBJECTS INCIDENTAL OR ANCILLARY OBJECTS TO THE ATTAINMENT OF

MAIN OBJECTS ARE:

1. To make, manufacture, purchase, import or otherwise deal in all types of materials

directly or indirectly used in the manufacture of any items mentioned under main objects

of this Company.

2. To buy or generate for the purpose of the company, steam, heat, light, electricity, gas

or other power.

3. To carry out at any place in India or elsewhere Research and Development in the field

of manufacture of electrical and electronic goods, plant and equipments for the

attainment of main objects of the Company.

4. To acquire from any person, firm or body corporate whether in India or elsewhere,

technical information, know-how, process, engineering, manufacturing and operating

data, plans, layouts and blue prints useful for the designs, erection and operations of plant

12

required for an activity of the business of the company and to acquire any grant of license

and other rights and benefits in the foregoing matters and offer cash or any other assets.

5. To purchase, take on lease or in exchange hire or otherwise acquire any real and

personal properties and any rights or privileges which the Company may think necessary

or convenient for the purpose of its business.

6. To acquire and undertake the whole or any part of the business, property and liabilities

of any person or firm or company carrying on any business which the company is

authorized to carry on or possessed or properly suitable for the purpose of this company.

7. To amalgamate with any other company having objects altogether or in part similar to

those of this Company.

8. To apply for purchase or otherwise acquire, any patents, trademarks, brevets'd'

inventions, licenses concessions or the like conferring any exclusive or non exclusive or

limited right to use any secret or other information as to any invention which may seem

to the company capable of being used for any of the purpose of the Company or

calculated directly or indirectly to benefit the Company, and to use, exercise, develop or

grant license in respect of, or otherwise turn to account the property, rights or information

so acquired.

13

Major Milestones of Company

2009:

Set up of fully automatic 2nd unit for switchgear manufacturing at Baddi.

Global consolidation of CFL manufacturing plant at Neemrana for domestic

and export purposes.

Launch of India's 1st HPF CFL

Launch of India's 1st BEE 5* Rated Fan 

2008:

First Indian CFL manufacturers to have adopted RoHS, European norms on

Restriction of Hazardous Substances in CFLs.

Set up of Global Corporate office, QRG Towers at Expressway Noida

Investment of Rs.50 Crores in Global Center for Research and Innovation

(CRI)

Set up of fully automatic plant for Havells Lafert Motors at Neemrana

Change in Corporate BRAND identity 

2007:

Set-up of Capacitor manufacturing plant in Noida, UP with the capacity of 6,

00,000 kVAr per month.

Acquired the Lighting business of a Frankfurt based company "Sylvania", a

global leader in lighting business and now the company's turnover crosses

US$ 1 Billion.

Warburg Pincus, a global private equity firm and one of the largest investors

in India, invested US $110 million in Havells India Ltd. Havells issued fresh

shares to Warburg Pincus, representing approximately 11.2% of the fully

diluted share capital of the company.

14

QRG Group entered healthcare business by acquiring a majority stake in

Central Hospital and Research Centre, Faridabad.

2006:

Crabtree India merged with Havells India.

Added CFL production unit in Haridwar manufacturing plant.

Expansion at Alwar manufacturing plant for increase of production capacity.

Expansion at Baddi manufacturing plant and set-up of an Export Oriented

Unit.

First Company to get the ISI Certification for complete range of CFLs.

Started mid-day meal program at Alwar, Rajasthan caters to 10,000 students

from 77 schools.

2005:

Set up manufacturing plant in Haridwar, Uttaranchal for manufacturing Fans.

Awarded the KEMA certification by The Dutch Council for Accreditation,

making QRG the only group to attain this certification.

Set up of R&D Center in Noida H.O.

2004:

Set up manufacturing plant at Baddi, HP for manufacturing of Domestic

Switchgear.

Set up a manufacturing plant for manufacturing of CFL at existing

manufacturing plant in Faridabad, Haryan.

Set up a manufacturing plant for manufacturing of Ceiling Fans at Noida, UP.

Set-up our own marketing office in London through our wholly owned

subsidiary company Havells U.K. Ltd.

15

In December, 2004 placed 235 fully convertible debentures of Rs. 10 Lacs on

M/s. Shine Ltd., Mauritius and the debenture will be converted in June, 2006.

Attained the CE certificate for CFL.

HISTORY OF COMPANY

16

History of the company is very interesting as it started with small manufacturing unit of electrical parts and slowly become worldwide and incorporated its ventures even in America. The data shows the history of company in past around 50 years.

1958: Commenced trading operations in Delhi

1971: Bought HAVELLS Brand

1976: Set up the first manufacturing plant for

rewire able Switches and Changeover Switches

at Kirti Nagar, Delhi. Havells in the year 1976.

1979: Set up a manufacturing plant for HBC

Fuses at Badli, Delhi.

1980: Started manufacturing high quality Energy Meters at Tilak Nagar, Delhi.

1983: Acquired Towers and Transformers Ltd. and turned it into a profitably

manufacturing Energy Meters Company in one year.

1987: Started manufacturing MCBs at Badli, Delhi in a Joint Venture with Geyer,

Germany.

1990: Set up a manufacturing plant at Sahibabad, UP for Changeover Switches.

1993: Set up another manufacturing plant at Faridabad, Haryana for Control Gear

Products.

17

1996: Acquired a manufacturing plant at Alwar, Rajasthan for Power Cables & Wires.

Entered into a Joint Venture with Electrium, UK for manufacturing Dorman Smith

MCCBs and Crabtree Modular Plate Switches.

1997: Acquired Electric Control & Switchboards at NOIDA for manufacturing

customized packaged solutions.

1998: Introduced high-end Ferraris Meters in Joint Venture with DZG, Germany.

2000: Acquired controlling stake in Duke Arnics Electronics (P) Limited engaged in

manufacturing of Electronic Meters-Single Phase, Three Phase, Multi Function, Tri-

Vectors.

Acquired controlling interest in an industry major-Standard Electricals Ltd.

2001: Acquired business of Havells Industries Ltd, MCCB of Crabtree India Limited and

merged ECS Limited in the company to consolidate its area of core competence.

2002: Standard Electrical Company becomes a 100% Subsidiary of the company

Attained the IEC certification for Industrial switchgear and CSA certification for all

manufacturing plants.

2003: Set up manufacturing plant at Baddi (H.P.) for manufacturing of Domestic

Switchgear.

Set up a manufacturing plant for manufacturing of CFL at existing manufacturing plant in

Faridabad, Haryana.

2004: Set up a manufacturing plant for manufacturing of Ceiling Fans at Noida, UP.

Set-up their own marketing office in London through their wholly owned subsidiary

company Havells U.K. Ltd.

In December 2004, placed 235 fully convertible debentures of Rs. 10 lakhs on M/s. Shine

Ltd., Mauritius and the debenture got converted in June, 2006 Attained the CE certificate

18

for CFLs.

2005: Set up manufacturing plant in Haridwar, Uttaranchal for manufacturing Fans.

Awarded the KEMA certification by The Dutch Council for Accreditation, making QRG

the only group to attain this certification.

2006: Crabtree India merged with Havells India.

Added CFL production unit in Haridwar

manufacturing plant.

Expansion at Alwar manufacturing plant for increase of production capacity.

Expansion at Baddi manufacturing plant and set-up of an Export Oriented Unit.

2006: First Company to get the ISI Certification for complete range of CFLs.

Started mid-day meal program at Alwar, Rajasthan caters to 10,000 students from 77

schools.

2007: Set-up of Capacitor manufacturing plant in

Noida, UP with the capacity of 6, 00,000 KVAr per

month. Acquired the Lighting business of a Frankfurt based company "Sylvania", a

global leader in lighting business and now the company's turnover crosses US$ 1 Billion.

Havells at that time was best known for its electrical switches, energy meters and miniature

circuit breakers (MCBs), while SLI Sylvania was a renowned yet under-leveraged European

lamps and fixtures brand. In March 2007, Havells acquired SLI Sylvania of Netherlands for $300

Million, making it the fourth largest lighting business in the world, worth over a billion USD!

This was, at that time, the biggest overseas takeover by an Indian Electrical equipment

manufacturer. This takeover helped take the Havells brand to over 20,000 dealers across Latin

America, Europe, Asia and Africa. It instantly catapulted Havells-Sylvania into the billion-dollar

league (in terms of combined turnover), with more than 60% of its revenues being contributed by

international markets.

19

Havells’ portfolio of prestigious global brands now includes Crabtree, Sylvania, Concord,

Luminance, Linolite & SLI Lighting.

2008: First Indian CFL manufacturers to have adopted RoHS, European norms on

Restriction of Hazardous Substances in CFLs.

Set up of Global Corporate office, QRG Towers at

Expressway Noida. Investment of Rs.50 Crores was

invested in Global Center for Research and Innovation

(CRI). Set up of fully automatic plant for Havells Lafert

Motors at Neemrana. Havells Corporate Office

Change in Corporate BRAND identity.

2009: Set up of fully automatic 2nd unit for switchgear manufacturing at Baddi.

Global consolidation of CFL manufacturing plant at Neemrana for domestic and export

purposes. Launch of India’s 1st HPF CFL. Launch of India’s 1st BEE 5* Rated Fan.

2010: Inauguration of fan manufacturing unit 2 at Haridwar.

Global Launch of LED products. Acquired 100% interest in Standard Electricals.

Sets up World’s First New Generation CMH Lamp Plant at Neemrana.

20

BOARD OF DIRECTORS

21

Pursuant to the provisions of Section 256 of the Companies Act, 1956, Shri Surjit Guptaand Shri

S B Mathur, Directors, are due to retire by rotation at the ensuing Annual General Meeting and

being eligible, offer themselves for re-appointment.

Dr. Abid Hussain and Maj Gen D N Khurana vacated their office of Directorship in the

Company w.e.f. 5th July 2010, pursuant to the Company’s policy on tenure of Independent

Directors. The Board of Directors appreciates the valuable contribution made by Dr Hussain and

Maj Gen Khurana during their tenure.

The Board of Directors in their meetings held on 11 th May, 2010

and 28thJuly 2010, appointed Shri S K Tuteja and Dr. Adarsh

Kishore respectively as Additional Directors. As per the

provisions of Section 260 of the Companies Act, 1956, Shri

Tutejaand Dr. Kishore shall vacate office at the forthcoming

Annual General Meeting. Due notice sunder section 257 of the

Act have been received from Members of the Company

proposing the appointment of Shri Tuteja and Dr. Kishore as

Directors of the Company at this Annual General Meeting, whose period of office shall be liable

to determination by retirement of Directors by rotation. Both the Directors have filed their

consents pursuant to Section264 (1) of the Act to act as such Director, if appointed.

Mr. Tuteja is an IAS, FCS and M Com from DU with 1st position. Mr. Tuteja began an

illustrious career as a lecturer of commerce in the esteemed Shri Ram College of Commerce

(SRCC) and moved on to serve the Government of India (GOI) in various capacities. Besides, he

has acted as a consultant to various international programmers carried out in the field of new

technologies and innovations. He has also participated as a Member of the Indian Delegation in

the Fourth Ministerial Conference of WTO held in Doha, Qatar. He was also the Chairman of the

Committee on Revitalization of Sugar Industry and later a member of the group of experts

22

constituted by GOI on Sugar Sector in 2007. He has also chaired the Pay Commission of the

Government of Punjab (2006-09).

Dr. Kishore, a 1969-batch IAS officer of the Rajasthan cadre, is a former Finance Secretary,

Government of India and former Executive Director, International Monetary Fund representing

Bangladesh, Bhutan, India and Sri Lanka. He currently chairs the Board of Axis Bank Limited

and is also the Chairman of its Risk Management Committee, Chairman of Shareholders/

Investors Grievance Committee and Member of Special Committee of the Board of Directors for

Monitoring of Large Value Frauds.

In accordance with the provisions of Sections 198, 269, 309 and 310 read with Schedule XIII and

all other applicable provisions of the Companies Act, 1956, the Remuneration Committee of the

Board of Directors in its meeting held on 11 th May, 2010re-appointed Shri Rajesh Gupta as the

Whole time Director - Finance of the Company for a period of 5 years effective 1st April, 2010.

The Remuneration Committee also varied the terms of remuneration of Shri Qimat RaiGupta,

Chairman and Managing Director and Shri Anil Gupta, Joint Managing Director, by introducing

a component of commission based on percentage of profits, in their salary structure.

The details of Directors being recommended for re-appointment as required in the clause49 of

the Listing Agreement are contained in the accompanying Notice convening the ensuing Annual

General Meeting of the Company.

23

Managing Director

Mr. Qimat Rai Gupta is the Founder Chairman

and Managing Director of Havells India Ltd. In the

summer of 1958, a 21-year-old school teacher

traded education for entrepreneurship in the

electric wholesale market in Old Delhi. Driven

more than by the economic necessity of helping his

family, Qimat Rai Gupta swapped the security of a

classroom in Punjab for the uncharted waters of a

small trading company selling fixtures and electric cable to businesses in and around Delhi. With

an investment of Rs.10000, he started “Guptajee”. His leadership and vision led him to create

QRG Enterprises as one of the players in the power distribution equipment industry as well as

make its mark on the global space.

His belief in team work, implementation of the decisions, communication and transparency

through ethical values, business integrity and technological expertise have made the QRG group

and especially Havells India Ltd the largest player low voltage power distribution equipment

industry in India and a name to reckon within the global market.

The company’s phenomenal success over the years has been due to Mr. Qimat Rai Gupta’s

mantra, “Growth through quality, innovation and market consolidation". His focus on

research and development has enabled Havells develop products for consumers that offer great

value. His constant emphasis on promoting energy conservation and environmental

preservation coupled with his philanthropic service to the economically weaker section of the

society is his way of giving back in return to the society that has helped this organization realize

its true potential.

24

25

BRANDS OWNED

BY COMPANY

26

Havells owns some of the prestigious global brands like Crabtree, Sylvania, Concord,

Luminance, Linolite, SLI Lighting etc. These brands are discussed as follows:

Crabtree

Crabtree products represent a fine blend of art and

science. Designing aesthetically appealing

products while maintaining high levels of

engineering excellence over the years, has helped Crabtree maintain its leadership position in the

product category.

We give you features to safeguard life and property. And an unparalleled engineering excellence

and many technological innovations like dust-free switches and universal sockets. When it

comes to switches, we know what it takes to create a sheer masterpiece of a switch. And craft it

to perfection.

Crabtree was started by the inventor of switch mechanism, John Ashworth Crabtree, which till

date is the underlying foundation of all the switches. And that legacy still continues.

Sylvania

The world renound brand, Concord, part of global

lighting manufacturer, Havells Sylvania, impressed

the jurys of two of the most prestigious international design awards in the space of a week. With

its outstanding and innovative design, Concord’s Stadium LED spotlight was awarded the 2010

Lighting Design Awards for best Interior Luminaires and the “red dot award: product design

2010”. The judges of the 2010 Lighting Design Awards stated, the Concord Stadium LED

spotlight “is a new form factor for LED accent lighting.” Whilst this year, designers and

companies from 57 nations with a total of 4,252 products took part in the “red dot award: product

design”.

27

“They are much honored winning these two important awards. It proofs that, finally,

functionality and design is no antagonism in the light business anymore”, says Nick Farraway,

VP & SBU leader for Concord. “Stadium evolved from the simple functional requirements of the

thermal management of the LED diodes and the driver to gain optimum efficiency and

performance. The square finned form achieves maximum cooling of the LED area with

minimum size and material use. The unique integration of the driver components between the

lenses further adding to Stadium’s slim appearance, creating a truly innovative design in LED

spotlighting”, explains Tony Lawrence, Concord Design Manager, the design approach.

Concord

The Concord Stadium is an innovative low energy LED spotlight for a myriad of lighting

applications, including museums, galleries and retail spaces. The Stadium portfolio introduces

two versions, Stadium EVO and Stadium PRO, both with excellent color rendering, low running

temperatures, very long lamp life resulting in reduced maintenance costs and energy saving

efficient light source with low power consumption.

Linolite

Linolite-Sylvania features a variety of high quality utility lighting

fixtures for residential and commercial environments. Where

possible all Linolite-Sylvania products are supplied with a Sylvania

lamp and are available from stock. Sales and distribution of

Linolite-Sylvania products are the joint responsibility of our

country sales organizations and our partners: the electrical and lighting wholesalers.

SLI Lighting

SLI is committed to technological innovation, superior

product quality, and dependable performance. We

manufacture to comply with many international standards, including IEC, ANSI, ISO 9000, ISO

14000, UL, and Energy Star.

28

Competitive Advantage

29

FINANCIAL OVERVIEW OF

COMPANY

30

Industry Overview

India emerged largely unscathed from global recession. The domestic demand continues to be

robust attracting global players in India. Definitive change in consumer spent in favour of

branded products is clearly visible both in rural and urban markets in India.

Havells enjoys leading position in the electrical consumer market. With the large product basket,

strong brand and widely spread distribution channel, Havells enjoys a unique position to cater to

the consumer needs.

With market liberalization, increasing consumerism and higher disposable income, Indian

markets are exhibiting revolutionary changes. The Indian consumer is rapidly evolving and

Indian growth story is visible in both urban and rural markets. Increasing urbanization coupled

with high disposable income growth in rural market is trilling consumer sector. The rural

consumer market is expected to reach 720-790 million customers in 2010-11, according to a

white paper prepared by CII-Technopak. The economy in the first quarter of this year shows

indications of significant growth in automobiles, consumer durables, and FMCG and retail

segments.

While India is on growth path, certain parts of global economy are still under turbulence. The

matured economies like US and Europe, albeit stable, have still not recovered fully out of

recession. The Latin American economies and other emerging economies in Asia and Africa on

the other hand provide better growth opportunities.

Havells India Performance – stand alone

During financial year 2009-10 Havells India has shown a growth of 12% in net revenue at Rs.

2,474 crores from Rs. 2,198 crores in 2009-10. The earnings before interest, depreciation and tax

were up by 55% from Rs. 196 crores in 2008-09 to Rs. 305 crores in 2009-10. Profit after tax

was up by 58% from Rs. 145 crores in 2008-09 to Rs. 228 crores in 2009-10.

31

Financial year 2010 IN RETROSPECT

Havells, on a consolidated basis had net sales of Rs. 5,431.53 crores in financial year 2009-10

against Rs. 5,477.49 crores in previous financial year 2008-09. Havells, on a stand-alone basis

had net sales of Rs. 2473.52 crores in financial year 2009-10 against Rs. 2198.36 crores in

financial year 2008-09. The operating profit before interest and depreciation was Rs. 305.48

crores in financial year 2009-10 against Rs. 196.91 crores in financial year 2008-09. The interest

charges for financial year 2009-10 were Rs. 6.43 crores against Rs. 19.34 crores in financial year

2008-09.

Profit after tax was Rs. 228.16 crores in financial year 2009-10 against Rs. 145.23 crores in

financial year 2008-09. Sylvania, on stand-alone basis recorded a Revenue of Rs. 2939 crores in

financial year 2009-10 against Rs. 3307 crores in financial year 2008-09. Operating profit/ (loss)

before interest and depreciation and exceptional item was (Rs. 9) crores.

Rupees(in

millions)

Q1

FY09

Q1

FY10

Change %

Net Revenue 5,534 5,862 6%

EBIDTA

As a % of NR

550

9.9%

724

12.4%

32%

Depreciation Interest 37

49

54

16

Add other income 6 4

Profit before tax

As a % of NR

470

8.5%

658

11.2%

Tax 63 165 40%

Net Profit 407 493 21%

32

As a% of NR 7.4% 8.4%

Results summary

6% growth in Net Revenue compared to the prior year comparable period. This was

driven by 17-20% growth across all business segments except cable and wires which

reported a 4% decline in revenues compared to the prior year comparable period .

32% growth in EBIDTA driven by a 250 basis points improvement in EBIDTA margins.

Margin improvement is mainly driven by reduction in fixed cost base, decline in material

cost with stable prices and increased contribution from cable & wire division

Interest cost reduction owing to lower utilization of credit facilities driven by efficient

working capital management

Tax cost increased due to reduction in fiscal exemption for Baddi unit and higher

contribution from non exempted unit like cable & wire

21% growth in Profit after Tax with 100 basis points improvement at Rs. 493 mn in Q1

FY10.

33

34

Introduction to Human Resource

Department

35

Havells’ core strengths — starting with the talent, dedication and values of our employees —

position us to achieve growth. We operate with the highest standards of integrity and respect for

human rights. Our world grows more complex every day. We face increased challenges —

geopolitical, environmental, regulatory and technical. But our employees have risen to

challenges with dedication, ingenuity and hard work.

To foster an innovative spirit in the organization, Havells has in place an established policy by

the name “Idea” whereby every employee is encouraged to come up with ideas – however small

– that could improve his/her particular job activity, job environment or any company process for

that matter. The Company has also formulated a policy by the name “Satark” in line with the

Company’s commitment to the highest possible standards of ethical, moral and legal business

conduct and open communication. The policy provides all employees, an avenue to raise

concerns by accessing the top management, in case they observe any unethical or improper

activities or any other wrongful conduct. Developing our greatest asset, our employees, is an

integral part of our business and we place great emphasis on continuous learning and

development. Through its ‘gyanodaya sessions’ Havells displays its commitment to inculcating a

culture of knowledge sharing. Our goal is to keep management and employees up to date with

current best practices, policies, processes, technologies, laws et al.

Ethical business conduct is critical to a business. Accordingly, Employees of the Company are

expected to read and understand this Code, uphold these standards in day-to-day activities, and

comply with: all applicable laws; rules and regulations and all applicable policies and procedures

adopted by the Company that govern the conduct of its employees. The directors and officers of

the Company must not only comply with applicable laws, rules and regulations but should also

promote honest and ethical conduct of the business. They must abide by the policies and

procedures that govern the conduct of the Company's business. Their responsibilities include

helping to create and maintain a culture of high ethical standards and commitment to

compliance, and to maintain a work environment that encourages the stakeholders to raise

concerns to the attention of the management.

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EMPLOYEE ENGAGEMENT

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INTRODUCTION OF EMPLOYEE ENGAGEMENT

Employee engagement, also called work engagement or worker engagement, is a business

management concept. An "engaged employee" is one who is fully involved in, and enthusiastic

about, his or her work, and thus will act in a way that furthers their organization's interests.

According to Scarlett Surveys, "Employee Engagement is a measureable degree of an employee's

positive or negative emotional attachment to their job, colleagues and organization which

profoundly influences their willingness to learn & perform at work". Thus engagement is

distinctively different from satisfaction, motivation, culture, climate and opinion and very

difficult to measure.

Engagement is consistently shown as something given by the employee who can benefit the

organization through commitment and dedication, advocacy, discretionary effort, using talents to

the fullest and being supportive of the organization’s goals and values. Engaged employees feel a

sense of attachment towards their organization, investing themselves not only in their role, but in

the organization as a whole.

Engagement levels can vary according to different biographical and personality

characteristics. Younger employees may be positive when they first join an organization, but

can quickly become disengaged. Highly extravert and adaptable individuals find it easier to

engage. Engagement is a choice; dependent upon what the employee considers is worth

investing themselves in.

Being satisfied at work is a weaker predictor of business outcomes than engagement and lacks

the two-way reciprocal relationship characteristic of engagement. There is a very strong

relationship between organizational citizenship and engagement, as both focuses upon going

beyond the expected. Both engagement and the psychological contract have a cognitive and

emotional element and can depict the two-way employee-employer relationship.

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IMPORTANCE OF EMPLOYEE ENGAGEMENT

A company's success is predicated on having effective integrated strategies for their

people, operations and finances.

The people strategy drives the success of their financial and operational strategies.

Work with companies to help them achieve their business objectives by developing

effective people strategies and facilitating an environment of employment engagement.

This approach is innovative and new to the marketplace.

A clear view of the behaviors demonstrated by the engaged employee emerged:

belief in the organization

desire to work to make things better

understanding of business context and the ‘bigger picture’

respectful of, and helpful to, colleagues

willingness to ‘go the extra mile’

Keeping up to date with developments in the field.

BENEFITS OF EMPLOYEE ENGAGEMENT

To overcome fear of change, increase acceptance of new ideas, and create a climate

for achievement.

To enhance personal accountability and self-management skills.

To discover practical tools for effective goal implementation and sustained growth.

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To determine applicable techniques for motivating yourself and others.

To develop a “can do” attitude.

Objectives of employee engagement

To boost up the Energy level of the Employees.

Having some fun along with work.

Feeling of belongingness.

An effort to develop the communication skill.

To increase self confidence & motivation level in the employees.

A way to develop the personality in the right direction.

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Employee Relationship Management (ERM)

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Generating engagement

Recent research has focused on developing a better understanding of how variables such as

quality of work relationships and values of the organization interact and their link to important

work outcomes. 84% of highly engaged employees believe they can positively impact the quality

of their organization's products, compared with only 31 percent of the disengaged. From the

perspective of the employee, "outcomes" range from strong commitment to the isolation of

oneself from the organization. The study done by the Gallup Management Journal has shown

that only 29% of employees are actively engaged in their jobs. Those "engaged" employees work

with passion and feel a strong connection to their company. About ⅔ of the business units

scoring above the median on employee engagement also scored above the median on

performance. Moreover, 54% of employees are not engaged meaning that they go through each

workday putting time but no passion into their work. Only about ⅓ of companies below the

median on employee engagement scored above the median on performance..

Access to a reliable model enables organizations to conduct validation studies to establish the

relationship of employee engagement to productivity/performance and other measures linked to

effectiveness.[

It is an important principle of industrial and organizational psychology (i.e. the application of

psychological theories, research methods, and intervention strategies involving workplace issues)

that validation studies should be anchored in reliable scales (i.e. organized and related groups of

items) and not simply focus on individual elements in isolation. To understand how high levels

of employee engagement affect organizational performance/productivity it is important to have

an a priori model that demonstrates how the scales interact.

There is also overlap between this concept and those relating to well-being at work and the

psychological contract. As employee productivity is clearly connected with employee

engagement, creating an environment that encourages employee engagement is considered to be

essential in the effective management of human capital

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Corporate Governance

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What is Corporate Governance?

Corporate governance is the set of processes, customs, policies, laws, and institutions affecting

the way a corporation (or company) is directed, administered or controlled. Corporate

governance also includes the relationships among the many stakeholders involved and the goals

for which the corporation is governed. The principal stakeholders are the shareholders, the board

of directors, employees, customers, creditors, suppliers, and the community at large.

Corporate governance is a multi-faceted subject. An important theme of corporate governance is

to ensure the accountability of certain individuals in an organization through mechanisms that try

to reduce or eliminate the principal-agent problem. A related but separate thread of discussions

focuses on the impact of a corporate governance system in economic efficiency, with a strong

emphasis on shareholders' welfare. There are yet other aspects to the corporate governance

subject, such as the stakeholder view and the corporate governance models around the world (see

section 9 below).

The National Foundation for Corporate Governance (NFCG) has prepared a Discussion Paper on

Corporate Governance in India for debate and discussion. The Discussion Paper examines the

definition and importance of corporate governance as well as the importance of regulating

corporate governance practices in the country. The Discussion Paper also traces the initiatives

and regulations with regard to the evolution of corporate governance in the country and

benchmarks the existing regulations and practices against the widely accepted and well-known

OECD Principles of Corporate Governance.

The Paper identifies the future drivers of corporate governance in India and examines how, apart

from regulations, the forces of competition and demand for low cost capital will provide the

momentum for Indian companies striving to achieve higher standards of corporate governance.

Finally, the Paper contains a chapter on the initiatives and activities that the NGCG proposes to

undertake to promote good corporate governance practices in the country.

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Features of Good Corporate Governance

1. To avoid conflicts of interest, a company's board of directors should include a

substantial majority of independent directors-independent meaning that directors don't

have financial or close personal ties to the company or its executives.

2. A company's audit, nominating, and compensation committees should consist entirely

of independent directors.

3. A board should obtain shareholder approval for any actions that could significantly

affect the relationship between the board and shareholders, including the adoption of anti-

takeover measures such as "poison pills."

4. Companies should base executive compensation plans on pay for performance and

should provide full disclosure of these plans.

5. To avoid abuse in the use of stock options (and executive perquisites), all employee

stock option plans should be submitted to shareholders for approval.

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Corporate Governance at Havells

The QRG Group defines corporate governance strategically, which encompasses not only what

we do as a company with our profits, but also how we make them. It goes beyond philanthropy

and compliance and addresses how our company manages its economic, social, and

environmental impacts, as well as its relationships in all key spheres of influence: the workplace,

the marketplace, the supply chain, the community, and the public policy realm.

We as a company have been in lead in offering a portfolio of eco responsible products and

services that deliver powerful, sustainable, energy-efficient solutions that don't compromise on

capacity and security. Our eco responsibility initiative also focuses on how we run our business,

and includes efforts to develop an alternative-energy strategy, and thus reduce the environmental

impact of our operations. We strive to bring corporate responsibility to every aspect of our

business. We're committed to managing a responsible and diverse supply chain that's consistent

with our high standards for environmental and business practices.

Breaking down the barriers that constrain innovation is a challenge; we have readily embraced

right from the start. Our ability to build communities and promote the exchange of ideas through

assistive technologies, participation programs, and standardization is transforming the way

people experience our products. We offer our customers holistic energy-efficient solutions,

enabling them to not only save money and protect their capital investment, but also lower their

energy usage and protect the environment, thus fulfilling our CSR responsibility of sustenance of

depleting environmental resources.

Corporate Governance and Ethics

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An implicit sense of ethical business conduct has been the cornerstone of the QRG way on

corporate governance. On issues ranging from customer care and business excellence to financial

propriety and more, explicit rules and regulations supplement the traditional values on which our

group companies have been shaped. This is what we have endeavored to do in the 50 years of

our existence. Our values of understanding, trust, integrity and ethics have served us in good

stead.

Corporate governance as practiced by our Group translates into being fair and civic-minded,

fulfilling our duties to the entire spectrum of stakeholders, and, most importantly, making

integrity an article of faith across all our operations. The group's adherence to ethical business

conduct is rooted in the vision of its Founder Mr Qimat Rai Gupta. We started on sound and

straightforward business principles, considering the interests of our shareholders and welfare of

our employees as foundation of our long term success.

The 'leadership with trust' philosophy that has come to play such a vital role in how our

customers perceive us is all the more remarkable given the climate of unparalleled public distrust

of people in positions of authority today both in business and politics.

Employee Relations

Our people are the key to our success. Their skills, knowledge, ideas and enthusiasm drive our

business. We have high-quality, diverse workforce and employees who fulfill their potential. We

have achieved this by giving them development and advancement opportunities along with

competitive compensation and benefits that appropriately reward performance

We communicate widely with employees to demonstrate how their efforts contribute to our

success and to listen to their concerns. We also encourage them to align with our vision. We are

committed to open communications and a workplace where everyone's voice is heard.

We use several channels to communicate with employees, including an internal web portal and

company website along with communication sessions with the top management of the company.

These sessions provide assessment of employee satisfaction and are inputs for business planning,

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management decision-making and company strategy development. They also help employees

implement company policies, meet high standards of conduct and ensure their behavior reflects

company values and policies.

We seek to meet leading health, safety and wellness standards to enhance our business

performance while optimizing employee health. Our facility policies are designed to continually

reduce the risk of occupational injury and illness while promoting employee health and well-

being. We wish to be a company that is known for its leadership in corporate ethics and

responsibility. A company where employees are proud to work, and customers, partners and

suppliers want to do business with.

Corporate Social Responsibility

While it acquires companies and builds internally, QRG Group never loses sight of its

responsibility as a good corporate citizen. QRG believes that serving people with meager or no

means is the duty of every well-to-do person. It consistently puts that philosophy into action and

has initiated several projects for social causes. This has greatly increased the number of children

attending school regularly and also alleviates hunger. Corporate Social Responsibility (CSR) at

QRG portrays the deep symbiotic relationship that the group enjoys with the communities it is

engaged with. As a responsible corporate citizen, they try to contribute to social and

environmental causes on a regular basis.

Havells contributes to socially responsible activities, like providing mid-day meal in

government schools in Alwar district, covering 15000 students per day. Besides this the

company has acquired land for constructing a larger kitchen with all the modern facilities to

serve freshly cooked food to 50000 students in the area. Havells runs a mobile Medical Van,

equipped with a trained doctor and necessary medicines in the rural areas of Delhi & NCR for

the very poor and needy villagers. They have also set up free medical check-up camps. In the

past, the company has also contributed to the society during various national calamities like the

Bihar Flood, Tsunami and Kargil National Relief Fund etc.

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Suggestion and Recommendation

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There should be separate notice board for thought of the day/zonal meetings & daily

updating of the offers.

Employee should be motivated by cash also.

Books shelf/library should provide latest books of Indian writers rather than Foreign

writers.

More efforts must be put on to improve the skills of the employees.

They should be provided for overtime i.e. if they work above 8 hrs.

More outdoor activities should be played.

More mental level training must be there rather than of physical & always of offers.

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BIBLIOGRAPHY

52

BIBLIOGRAPHY

The data in the project report is collected through various secondary sources some of which are:

Human resource management by Chadha, Harender K.

Human resource management by Dessler Gary

Human resource management by Aswathapa.K

Human resource management by C.B Gupta

Human resource management by Khanka

Human resource management by T. N chabhra

Human resource management by V.S Rao

Human resource management by Gosh, Biswanath

Data is collected through various websites which are:

www.havells.com

www.havells.co.in

www.wikipedia.com

www.answer.com

www.google.co.in

www.yahoosearch.com

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