Other Project

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K.S.S.K Ltd, Haveri.

Institute of management studies

. 1

INDUSTRY PROFILE

About Sugar Industry in India:

India has been known as the original home of sugar and sugarcane. Indian

mythology supports the above fact as it contains legends showing the origin of

sugarcane. India is the second largest producer of sugarcane next to Brazil presently,

about 4 million hectares of land is under sugarcane with an average yield of 70 per

hectare.

India is the largest single producer of sugar including traditional cane sugar

sweeteners, khandsari and Gurequivalent to 26 million tons raw value followed by

Brazil in the second place at 18.5 million tones. Even in respect of white crystal sugar,

India has ranked No -1 positioning 7 out of last 10 years.

History of Sugar Industry In India:

Traditional sweeteners Gur & khadsari are consumed mostly by the rural

population in India. In the early 1930 s nearly 2/3 rd of sugarcane production was

utilized for production of alternate sweeteners, Gur & khandsari. With better standard

of living and higher incomes, the sweeteners demand has shifted to white sugar.

Currently, about 1/3rd

sugarcane production is utilized by the Gur & khandsari sectors

being in the small scale sector, these two sectors are completely free from controls

and taxes which are applicable to the sugar sector.

The advent of modern sugar processing industry in India began in 1930 with

grant of tariff protection to the Indian sugar industry. The number of sugar mills

increased from 30 in the year 1930-31 to 135 in the year 1935-36 and the productionduring the same period increased from 1.20 lakhs tones to 9.34 lakhs tones under the

dynamic leadership of the private sector.

The era of planning for industrial development began in 1950-51 and

Government laid down targets of sugar production and consumption, licensed and

installed capacity, sugarcane production during each of the Five Year Plan periods.

The targets and achievements during various plan periods are given below.


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Manufacturing Process and Technology

Sugar (sucrose) is a carbohydrate that occurs naturally in every fruit and

vegetable. It is a major product of photosynthesis, the process by which plants

transform the suns energy into food. Sugar occurs in greatest quantities in sugarcane

and sugar beets from which it is separated for commercial use. The natural sugar

stored in the cane stalk or beet root separated from rest of the plant material through a

process known as refining.

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

Pressing of sugarcane to extract the juice. Boiling the juice unit lit begins to thicken and sugar begins to crystallize. Sinning the crystals in a centrifuge to remove the syrup, producing raw sugar. Shipping the raw sugar to a refinery where it is washed and filtered to remove

remaining non-sugar ingredients and color.

Crystallizing, drying and packaging the refined sugarBeet sugar processing is similar, but it is done in one continuous process whit

out the raw sugar stage. The sugar beets are washed, sliced and soaked in hot water to

separate the sugar containing juice from the beet fiber. The sugar laden juice is

purified, filtered, concentrated and dried in a series of steps similar to cane sugar

processing.

For the sugar industry, capacity is utilization conceptually different from that

applicable to industries in general depends crucial factors the actual number of ton of

sugarcane crushed in a day, the recovery rate which generally depends on the quality

of the cane and actual length of the crushing season.

Since cane is not transported to any great extent, the quality of the cane that a

factory receives depends on its location and is outside its control. The length of the


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crushing season also depends upon location with the maximum being in south India.

Products produced worldwide are divided in to basic categories:

COMPANY PROFILE

Introduction of the Company:

India is one of the highest sugars producing country in the world. It has large

number of sugar manufacturing factories situated throughout the country.

Karnataka Sahakari Sakkare Karkhane Ltd Sangur was registrated on 07-09-1973 and the production started on January 1983.

Shri.F.S TAWARI was the founder as well as chief promoter of this factory,

K.C.C Bank Dharwad had financed for the establishment of the factor.

The establishment project cost was Rs.720 lakhs this is situated in 115 acres

and its crushing capacity was 1250TCDin 1983 but in 1994-95 it was increased to

1800TCD .This factory is located on the bank of Varadha River it is 10km away from

the haveri. Haveri is the center place for transportation because NH4 passes here and

it connects various districts and taluks.

COMPANY AT GLANCE:

Name Of The Factory Karnataka Sahakari Sakkare

Karkhane Limited Haveri

Year of Establishment 7th

September,1973

1st Cushing Started January, 1983

Location of The Unit Karnataka Sahakari Sakkare

Karkhane Limited Haveri

Register Number R.C.S.2757:73-74

Registered Date 7-9-1973

Contact Persons 1) Company Secretary

2) Labor Welfare Officer


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3) Chief Engineer

Address For Correspondence Karnataka Sahakari KarkhaneLimited Haveri

Phone : Std Code 08375

Chairman : 284444

Office : 284424

Chief Engineer :

Fax : 284426

A. BACKGROUND AND INCEPTION OF COMPANY:

KARNATAKA SAHAKARI SAKKARE KARKANE Ltd, Registered as a co-

operative society on 7th

OCTOBER 1973, under the Karnataka co-operative societies

act 1959. The main purpose is to help sugarcane growers by purchasing sugar cane in

this area. The manufacturing plant is located at Sangur village, Haveri Taluk, Haveri

Dist, Karnataka.

KARNATAKA SAHAKARI SAKKARE KARKANE Ltd proposed plant

capacity is 2500 TCD at villages Sangur , Haveri Taluk, for the manufacture of white

crystal sugar along with the facilities for the co- generation of power with an installed

capacity of 12 MV surplus powers.

The estimated cost of this project is Rs.76.10 core, is proposed to by finance

by way of share capital Rs.28.25 core and term loan Rs. 47.85 core.

KARNATAKA SAHAKARI SAKKARE KARKANE Ltd, began its

production on 2005-06 as a trial production i.e. 11000 tonnes sugar produced by

getting 17000 tonnes sugarcane but unfortunately the factory doesnt earned i.e. got

loss due to several problems. During this year the factory allotted or paid a per ton Rs.

1400 to sugarcane suppliers (farmers) to attract the suppliers.

During 2007-08 the factory produced 320000 Qtls. of sugar from 263128

tonnes sugarcane crushed with an average recovery of 12.01%. Govt. Of India has


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fixed the Statutory Minimum Price (SMP) of Rs. 883.30 PMT, the factory has paid

Rs. 1050.00 per ton to sugarcane suppliers.

During the Season 2008-09 the factory has Crushed 143052 tonnes of sugar

cane and produced 147724 quintals of sugar with an average recovery of 10.40%.

Govt. of India has fixed SMP of Rs. PMT, the factory has paid Rs. 1450/- PMT to the

sugar cane suppliers.

OBJECTIVES OF ORGANISATION

To encourage self help, thrift and co-operation amongst members. To acquire lands, either by way of sale, lease or otherwise for cultivation of

sugarcane and other crops and for erection of building, Machinery etc.

To in calculate amongst members, improved modern methods of agricultureand cultivation of sugar cane and to supply seeds, material, manure

implements etc., for growing sugar cane and other crops and to promote

agriculture, Agro industries education for the well being of the members.

To manufacture sugar, Jaggery and others by products out of sugar canegrown and supplied by members of the society and others and to sell the same

to the best advantage. To make advance to members on the security of sugarcane or sugar made out

of their sugarcane and to advance loans for raising their crops and

development of Agriculture.

To install machinery for the utilization of by-products and buy raw materialsand finished products in the course of utilizing and marketing the by-products.

To sell or otherwise dispose off the whole or any part or parts of its businessassets or under takings or its factory, buildings, machinery and lands in the

interest of the society with the prior approval of the Director of sugar and

Registrar of co-operative societies or in the course of winding up the society.

To undertake such other activities as are incidental and conductive to thedevelopment of the society.

To encourage raising food and cash crops in the area where sugar cane is notgrown.

To undertake subsidiary and allied industries which are connected to thedevelopment and benefit of the society and its members.


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B. NATURE OF THE BUSINESS CARRIED:

K S S K ltd was established during 1973 in Sangur. The nature of business in

KSSK ltd is as follows;

The main production of KSSK is manufacturing of sugar heir main input for

production is sugarcane; sugar cane is the raw material for the production of sugar.

Aim to manufacturing good quality sugar and its by products.

Harvesting and processing season may vary from country to country and

factory to factory depending on the convenience. Usually, the harvest starts in

July/August and continues to April/may. Some factories have the continues supply of

cane thought the year, and they process them in whole year without idle of the

factory. There are varieties of sugarcanes which are available to farmers.

Their sub production is power; they generate power and use it for production

of sugar. During the season of sugar they generate power with the help of bagasse

which is sub product of sugarcane. And during off season they will generate power

with the help of wood and bagasse. By this we come to know that their main nature

sugar and generation of power.

COMPANY CHART

CHAIRMAN:

The Chairman (G.C.Hanchinal) of the factory shall have an overall control

over day-today managements of the factory. He shall preside over meetings of the

Board of Directors and the General body. The chairman of the factory shall have

general control over the affairs of the factory. He shall exercise such of the powers of

the Board as may be delegated to him.

He shall sanction leave to the salaried personal of the mill as a whole as under:

Leave to the Managing Director not exceeding 120 days.


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Leave to other salaried personal for a period exceeding 30 days but - notexceeding 120 days.

BOARD OF DIRECTORS

The Board of directors shall consist of 18 Directors as under.

i) 12 Members to be elected by the Grower Members.ii) One member to be elected by the co-operative members.iii)One member to be elected by non-grower member.iv)One representative of central financing agencies.v) Three nominees including Managing Director of the Govt. will be

nominated by the State Govt.

THE KARNATAKA SAHAKARE SAKKARE KARKHANE LTD

BOARD OF DIRECTORS

1. G.C.Hanchinal Chairman2. M.V.Ghadi Voice Chairman3. S.R.patil Director4. S.S.Sajjanar Director5. P.R.Kundapur Director6. N.M.Sheetalad Director7. R.B.chouti Director8. S.S.Mushti Director9. C.N.Nitaginakoppa Director10.Rajashekar katarki Director11.C.M.Udasi Director12.C.S.Naduvinmani Director13.M.S.Honnali Director14.V.G.motagi Director15.B.G.Benchihalli Director


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16.R.N.Koteshwar Director17.U.B.Veerapannanavar Director18.D.M.karajagi Director19.P.N.Patil Director20.DCC Bank Davanageri Director

C.Vision, Mission and QualityPolicy:

VISION:

We wish to grow into model sugar co-operation in the country.

KSSK has dedicated to deliver overall value to their customers, delivering

high quality products, exceptional financial performance to company shareholders and

complete satisfaction to cane-growers, employees and stakeholders.

To manufacture and trade in sugar and its by-products. To plant, cultivate cultivation, produce, raise and trade in sugarcane, sugar

beets and other crops.

Expansion of cane cultivation area to reach 30,000 lands under canecultivation.

Diversification ,Ethanol ,Sugar refineries, one more sugar plant, starchmanufacturing unit and increase in existing crushing capacity from 3500 TCD

to 5000/7500MT.

Enter into joint venture. Excellence in all spheres of management through.

MISSION:

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


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Increasing the production of sugarcane.QUALITY POLICY:

Regarding quality planning to provide healthy and sulphur free sugar to thecustomers.

D. PRODUCT PROFILE:

SUGAR

The sugar produced in KARNATAKA SAHAKARI SAKKARE KARKANE

Ltd, Haveri. Sugar factory is both refined confirming to EC!! Grade with negligible

sulphur content as well as plantation grade white sugar. The EC11 grade sugar meets

the European standards of refined sugar (Color of less than 45 IU).

Sugar is a sweet, white or brown, usually crystalline substance obtained

mainly from sugar cane or sugar beets and used commonly in food products. Sugar

means something sweet in from of taste.

Formula:12CO2+11H2O=C12H22O11+12O2

Carbon dioxide water=sucrose+oxygen

In chemistry sugar refers to any of the class of carbohydrates to which this

substance belongs. Glucose, lactose, and maltose are sugar most plants manufacture

sugar is solute in water, sweet to the taste and either directly or indirectly for

mentable.

The chemist knows as sucrose one of the family of sugars otherwise

known as saccharine as the name implies, contain carbon and hydrogen plus oxygen

in the same ration as in water.

Sugar is controlled commodity in India under the essential commodities

Act,1995.The government controls sugar capacity additions through industrial

licensing determines the price of the major input sugar cane, decides the quantity that


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can be sold in the open market, fixes the of the levy quarter sugar and determines

maximum stock levels for wholesalers etc.

RAW MATERIALS USED IN FACTORY:

1. Sugar cane2. Bagasse3. Chemicals and consumables4. Lime and sulphur

Types (grades) of sugars produce in sssskn

1. S1(powder) size2. S2(small) size3. M-30(medium) size4. L(big) size

By Products In Sugar Industry :The main by-products of sugar manufacturing are;

a) Bagasseb) Molassesc) Press mud

a. Bagasse:

Bagasse is the fibrous residue of cane stalk that is obtained after crushing and

extraction of juice. It consists of water, fiber and relatively small quantities of small

soluble solids. Bagasse constitutes about 30% of cane processed for production of

sugar, is used as a fuel for generation of steam and power to meet the production

requirements.

b. Molasses:

Molasses is the final effluent obtained in the preparation of sugar by repeated

crystallization .Sucrose and invert sugars constitute a major portion (40 to 60%) of


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molasses. Molasses is used for production of rectifiers spirit, which is as a feedstock

for production of chemicals as well as portable liquor. The country has been

producing about 1, 7 billion liters of alcohol utilizing 75-80% molasses production in

the country. Molasses can also be used for the production of ethanol which is used as

a blend fuel with gasoline in the transport sector.

c. Press Mud:

Press mud is the byproduct generated by cane juice filtration during sugar

manufacture. Impurities are precipitated during the course of clarification of

sugarcane juice. The cake, which is discharged after washing, is called press mud.

Currently press mud is used as fertilizer in sugarcane cultivation. Distillery effluents

are mixed with press mud that comes from sugar factory to make bio-fertilizer a

substitute for chemical fertilizer .This mud contains certain mineral and organic

matter.

E. AREA OF OPERATION:

1) Haveri2) Gadag3) Dharwad Except 36 villages of Dharwad

4) Karwar

Mundagod taluk Part of Sirsi taluk Haliyal taluk5) Shimoga

Sorab taluk6) Bellary

Part of Hadagali taluk


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Harpnahalli taluk

F. OWNERSHIP PATTERN:

It is a joint venture with share capital of Rs. 5.50 76.500 contributed by 20847

shareholders. The company was established in the year 1st September 1973 and

started crushing in January 1983. The company is registered under the provision of

Companies Act 1956.

G. COMPETITORS INFORMATION:

The major competitors are

1. Shamanur sugars, Duggavatti (near Harihar)2. Malaprabha shakari sakkare karkhane, Mugatkhan (near kittur,Belgaum district)3. Renuka sugars , Munuvalli ( Belgaum )4. Davanagere sugar company, kukkawad (Davanagere)

H.INFRASTRUCTURAL FACILITIES:Residential quarters have been constructed for the workers, these quarters are

divided in to 4 types i.e A, B,C and D

A-Is meant for managing directors B- Is being provided to top management officer C-Is has been allocated to administrative D is being reserved for Supervisor and Technicians.

Facilities Provided For Workers:

They provided VAN for school childrens Medical facility to employees and their families


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Credit co-operative society has been also started to serve the needs of theemployees.

Provide uniforms, good canteen, leaves like, Casual leave12 days per year Seek leave - 15 days per year Accidental leave3 days per year

Leave with permission33 days per year

J. WORK FLOW MODEL (END TO END):

The process of manufacture of sugar involves the following step:

1) Extraction of Cane Juice from Cane.2) Purification of Cane Juice.3) Evaporation of cane Juice to Facilitates Crystallization.

4)

Crystallization of Sugar.

5) Separation of Sugar and LiquidCentrifugal Force.6) Reboiling of liquid.

A brief description of the above process steps are given below:-

1. Extraction of Cane Juice from Cane:-

The cane which is weighed has unloaded in the carrier for conveying it to the

mills after proper preparation to facilitate extraction of juice from sugarcane.

It is the first prepared by passing through two sets of revolving knives that

outs the stalks in to pieces and in some places passed through hammer mills

shedders that shred the cane. The prepared cane enters mills, consists of multiple

units of 3 roller combination through which the prepared cane /crushed cane passed.


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Juice from previous mills and water before last mills, directed on the blanket

of Bagasse as it emerges from each mill help to leach out the sugar. In the best mills

95% of sugar goes in the juice.

Uses of Bagasse:

The residue that leaves the last mill is Bagasse which contains un -extracted

sugar, wood fiber and 45 to 55% of water. This material goes to Boilers as fuel to

produces steam, used in the running of turbines to generate electricity to run the plant

and this bagasse is used as raw material for paper.

2. Purification Of Cane Juice:- Clarification

The juice is strained to remove Bagasse particles before sending for process

.This juice is weighed in automatic juice scales and the number of discharges are

automatically entered /registered.

The dark green juice from mills is acidic and turbid. The universal process

employed to remove both soluble insoluble impurities employs lime and heat as he

clarifying agent. In sulphitatio factories SO2 gas is passed through the lime juice also

to bleach the solution. Milk of lime I In (0.5 kg) CaO (calcium oxide) per ton of cane

neutralizes the natural acidity of juices forming insoluble lime salts, mostly calcium

phosphate.

Heating the juice to boiling the coagulates albumin, fats, waxes, and gums.

The precipitate formed entraps suspended solids as well as finer particles .The entire

things goes to continues clarifies where mud separates from clear juice by

sedimentation. The mud goes to filtrates to remove the mud and clear juice goes to

evaporates.

3. Evaporation Of Cane Juice To Facilitates Crystallizations:.

The clarified juice having much the composition as a raw extracted juice

except for the predicated impurities removed contains 85% water. 75% of this water is


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evaporated in vacuum multiple effects consisting of generally four vacuum boiling

bodies arranged in series so that each succeeding body has a higher vacuum, therefore

boils at a lower temperature. The vapour from one body can thus boil the juice in the

next one. By this the heating steam introduced in the first body does multiple effect

evaporation. The vapour from the last body goes to a condenser, which condenses the

vapour and creates vacuum, in an Evaporator set of 4 bodies steam evaporates 4 times

its weight of water.

The clear juice which has about 15% solids is concentrated here to 65% solids and

35% water. This syrup is passed through a tower were SO2 gas also passed and

bleaches the syrup remaining 35% water to produce sugar crystals.

4. Crystallization Of Sugar:

Crystallization takes place in single effect vacuum pans, where the syrup is

evaporated until saturated with sugar. At this point seed grain is added to serve as

nuclei for the sugar crystals and more syrup is added as the water evaporates.Continuing the above process the pans are filled up till the desired size crystals are

built up and dropped in mixers is called crystallizers. The sugar and syrup forms a

dense mass known as massecuite.

5. Separation of Sugar And LiquidCentrifugalising:

The Massecuite from crystallization where sugar deposits on crystals due to

cooling is drawn into revolving machines called centrifugals. The cylindrical basket

suspended on a spindle has performed sides, linked with wire cloth, inside of which

are metal

Sheets containing 400 to 600 perforations per square inch .The performed

lines retain the crystals, which are washed with hot water. The mother liquor called

molasses passes through the lining due to centrifugal force exerted. The sugar drops

when machine is stopped .In the conveyor to remove moisture and high temperature,


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sugar is subjected to hot and cooled air treatment and Gradation in a grade as per I.S.

Specification, weighed and baggage.

6. Reboiling Of Liquid (Molasses):

The aim of sugar boiling is to remove more sugar and send less purity of

molasses (final molasses) as by-product, from which sugar manufacture is

uneconomical.

Michael E. Porters 5 Analysis Framework

Summary of Theory behind 5 Forces:

The Porter's 5 Forces tool is a simple but powerful tool for understanding

where power lies in a business situation. This is useful, because it helps the industry

to understand both the strength of its current competitive position, and the strength of

a position its looking to move into.

With a clear understanding of where power lies, it can take fair advantage of asituation of strength, improve a situation of weakness, and avoids taking wrong steps.

This makes it an important part of industrys planning toolkit

Conventionally, the tool is used to identify whether new products, services or

businesses have the potential to be profitable. However it can be very illuminating

when used to understand the balance of power in other situations too.


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Five Forces Analysis assumes that there are five important forces that

determine competitive power in a situation. These are:

1. Supplier Power: Here the industry assesses how easy it is for suppliers todrive up prices. This is driven by the number of suppliers of each key input,

the uniqueness of their product or service, their strength and control over it,

the cost of switching from one to another, and so on. The fewer the supplier

choices it has, and the more it need suppliers' help, the more powerful its

suppliers are.

2. Buyer Power: Here the industry should ask itself how easy it is for buyers todrive prices down. Again, this is driven by the number of buyers, the

importance of each individual buyer to its business, the cost to them of

switching from its products and services to those of someone else, and so on.

3. Competitive Rivalry: What is important here is the number and capability ofcompetitors if the industry has many competitors, and they offer equally

attractive products and services, then it will most likely have little power in the

situation. If suppliers and buyers dont get a good deal from it, theyll go


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elsewhere. On the other hand, if no-one else can do what industry do, then

you can often have tremendous strength.

4. Threat of Substitution: This is affected by the ability of industrys customersto find a different way of doing what it do for example, if the industry

supplies a unique software product that automates an important process,

people may substitute by doing the process manually or by outsourcing it. If

substitution is easy and substitution is viable, then this weakens its power.

5. Threat of New Entry: Power is also affected by the ability of people to enterits market. If it costs little in time or money to enter its market and compete

effectively, if there are few economies of scale in place, or if it has little

protection for its key technologies, then new competitors can quickly enter its

market and weaken its position. If it has strong and durable barriers to entry,

then the industry can preserve a favorable position and take fair advantage of

it.

FUNCTIONAL DEPARTMENTS

Finance Department:

As the name gives the clear meaning of finance of that the inflow and out flow

of cash. The Managing Director is the key person for who handles all the situations

of the authority from managing Director for finance and keeping all the records of

finance that is materials and also he is responsible for arranging the finance, workingcapital whenever need arises

Functions:

Reduce the cost of production. Reduce the overhead spending.

Reduce the visual credit.


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Capital Structure:

Authorized Capital:

The authorized share capital is Rs 20 corers; there are 4 types of

shareholders, which have been described as follows.

SUBSCRIBED CAPITAL:

SL NO PARTICULARS NO.OF MEMBERS SHARE AMT

1 A class(growers) 17708 2,58,08,000-00

2 B class(non grower) 2807 31,88,000-00

3 Cycles(Co-op society) 311 9,39,000-00

4 D class(Government) 1 2,51,23,500-00

TOTAL 20827 5,50,58,500-00

Production Department:

Production Department

Chief Chemist

Deputy Chief Chemist

Lab Chemist


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Lab in charge

Supervisors

Workers

The Chief Engineer, Chief Chemist and Civil Engineer form the structure of

the production section. The chief Engineers work is to maintain technical and

mechanical works and improve them to increase the crushing capacity.

The chief chemist work is to instruct how where and when to use chemicals in

the production process. The civil engineers work is to plan, where to situate the

machineries and also they advise useful suggestions to make the production very easy

and smooth.

Production Process:

1. Cane YardIn this they collect sugarcane from the farmers

2. Cane WeightIn this they measure sugarcane including vehicle after unloading the cane.

They measure vehicle weight and they deduct that weight in the total weight. Thus

they get the actual weight of the cane. They prepare 3 weight receipts with the help of

computers. One goes to Cane A/c another goes to farmer and third one goes to

Transport Office.

3. Cane Carrier


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The unloaded cane is put down in carrier and carrier is driven by the motor. It

is connected to cane cutter.

4. Cane Cutter

Cane cutter of 2 types.

a) 1st

Cutter in this cane cuts into 12 to 20 inches

b) 2nd

Cutter In this cane cuts into 3 to 5 inches

After cutting, cane is forwarded in fib riser. The fibrised cane is taken into

Mill section.

4. Mill SectionIn this section, the cane is squeezed. Whatever the quantity of juice quizzed in

thee mill, is pumped into clarification house. At this time they get the by-product

called bagasse.

5. DorrThe juice has some by-product like press mud and bagasse before it is stored

in the Dorr. After storing in the Dorr, these are separated and move downward.

Establishment Section:

It is concerned with the workers wages, salaries, bonus, leaves of workers etc.

Brief explanation in each section is as follows:

Division Of Labour

Departments Permanent Seasonal Total

General administration 275 256 661


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Engineering 90 122 212

Manufacturing 19 147 166

Civil 14 26 92

Cane

Development

40 52 92

Store Section 9 5 14

Godown 3 2 5

Time Office 5 7 12

Guest House 4 2 6

Vehicle 3 - 3

Sabhangana 2 - 2

Total 464 619 1213

Salary To Workers:

1. Permanent workers generally get Rs.3000 to 7000 including all allowances like

HRA,medical etc.

Salary approved by central government,

S.No.Category of

WorkersPay Scale

Medical

allowanceHRA


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M.D and secretary gets approximately Rs 18000 and Rs 15000 respectively

including all allowances.

1. Seasonal workers get Rs.1000 to Rs.3000 during season.In case of unseasonal & seasonal employees get retaining allowances as follows:

Unskilled workers get 29% of salary

1 Unskilled 1700-25-1950-302250-35-2775 150 170

2 Semiskilled 1800-30-2100-35-2450-4-3050 150 180

3 Skilled-B 1950-40-2350-45-2800-50-3550 150 195

4 Skilled-A 2100-45-2550-50-3050-55-3875 150 210

5 Highly Skilled 2200-50-2700-55-3250-60-4150 150 220

6 Clerical-iv 1950-40-2350-45-2800-50-3550 150 195

7 Clerical-iii 2100-45-2550-50-3050-55-3875 150 210

8 Clerical-ii 2200-50-2700-55-3250-60-4150 150 230

9 Clerical-i 2300-55-2850-60-3450-65-4425 150 230

10 Supervisor-C 2300-55-2850-60-3450-65-4425 150 240

11 Supervisor-B 2400-60-3000-65-3650-70-4700 150 260

12 Supervisor-A 2600-75-3350-90-1250-105-5825 150 280

13 Special Grade2800-100-3800-115 - 4950-130-

6900150 -


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Semiskilled workers get 39% of salary skilled and clerical workers get 52% of salary

Time and Labour Welfare Section

The is no social department like HRD or personnel Management in the

factory so Time and labour welfare officer is there, in this office there is labour

welfare officer and Head Timekeeper, Shift Timekeeper and Wage Clerk is there.

The main functions are as follows,

The shifts are divided into 3 shifts1

stShift 4. am to 12. am.

2st

Shift 12 am to 8. am.

3st

Shift 8. am to 4. am.

General shift is 8.30 am. to 12.30. pm. and

1.30. pm to 5.30. pm

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

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

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


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To workers.

7. School facility to workers children and also school bus carries childrenFactory to Haveri freely.

8. Compensation and medical facilities are available if any accident occurs.9. Workers get double payment if they work and O.T. duty and also id they

work in government holidays as per Factories Act- 1948.

Purchase Section:

The main function of purchase section is to purchase all the necessary raw

materials required by the factory except sugar cane. It is under the control of Chief

Engineer.

Purchase Procedure:

First concerned engineers prepare a list of materials according to the

requirement and sent the report to the purchase section.

First it goes to the stores section to enquire whether they are having a required

stock or not. If there is no stock then purchase officer invite quotations from different

companies by sending purchase in Executive committee Meeting. This committee has

8 directors and Managing director. This committee decides from which company have

to purchase. After this purchase officer sends the purchase order to the concerned

company and payments will be made on agreed date. Concerned company supplies

the required materials within few days.

Suppose the requirement is more than 25 lakhs then Government of Karnataka

interferes in the problem and it also appointed a state level Advisory committee for

this purpose.

Materials usually purchased are:

Machinery related like nut bolts, bearing parts of boilers, scraper plate, ruler,

pipes & fittings, electrical materials, oil, grease etc., Electrical materials, production

related like sulfur, gunny bag, chemicals, Burt lime etc


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Past Cane Purchase Rate:

Year Quantity Purchased

(in Metric Tons)

Amount per Ton

1986-87 48325 250

1987-88 153028 275

1988-89 156918 310

1989-90 75127 335

1990-91 130927 388

1991-92 196616 440

1992-93 180940 500

1993-94 129763 616

1994-95 253076 666

1995-96 246037 666

1996-97 196187 702

1997-98 136068 765

1998-99 182460 830

1999-00 275795 756

2000-01 140569 763

2001-02 107029 800

2002-03 100442 850


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Store and stores account:

Stores Section have all purchased materials required by the factory. It is also

under the control of Chief Engineer. It supplies necessary materials to factory

according to the concerned engineers order.

It maintains different accounts on the bases of section.

1. Mechanical section A/c.2. Electrical section A/c.3. Manufacturing section A/c.4. Civil Engineering section A/c.5. Cane Development section A/c.

When materials come to the store section storekeeper pass an indent and

inform to the concerned engineers then engineers check the materials and issue a

Quality Certificate. If materials are rejected, they are returned to the supplies with

Delivery memo.

Storekeeper again passes an Indent, when materials are supplied to the factory.

In this section they maintain 3 books,

2003-04 53697 866

2004-05 53697 866

2005-06 38440 1200

2006-07 52680 1200

2007-08 67842 1200


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1. First Information Report (FIR)2. Stores Received Book (SRB)3. Bin Card.

At present STORE SECTION have approximately 4000 items and their cost

is approximately Rs, 1 Cores.

In STORES ACCONT also they maintain all records of STORE SECTION

but they maintain only 2 books.

1. Stores Received Book. ( S R B )2. Stores Ledger Folio. ( S L F )

Stores ledger Folio is just like Bin card but only one change is, in Bin card

there is no any Amount Column. But in stores ledger folio amount column is there.

Share section:

According to By-law, the factories authorized share capital is Rs.20 cores. At

present the number of Shareholders is 20847 and capital collected from all the

shareholders is Rs.5506100.

Factory Issues mainly 4 types Of Shares:

1. A Class ------ producer members.

2. B Class ------ Non growers or ordinary members.

3. C Class ------ Co- operative societies.

4. D Class ----- Government.

Share Value:

The face value of each share - Rs 1000/-

Share admission fee - Rs 25/-


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Share fee - Rs 10/-

Total share value - Rs 1035/-

Account and cash section:

Cash Section

In this section all the payments are done recorded, for instance any payment

made to farmers regarding sugarcane purchases is also recorded in this section,

payment is made through bank cheque and sent to bank in which farmers have their

accounts.

Account Section

Accounts are maintained in traditional method no computers are provided in

this section. It is divided in to 2 sections.

1. Cane AccountIn this section all the farmers name, their sully of sugarcane and their payment

that has to be made are recorded. Here purchases are recorded in the purchase

registrar and another book is personal ledger which involves the entire farmers nameand another book is personal ledger which involves the entire farmers name and their

payments are recorded.

Cane Accounts are divided into 28 circles and each circle had 7-8 villages for

each circles one assistant is there to maintain records.

2. General AccountIn this section all the purchases of materials, which are required for factory

like gunny bag, bearing, spare parts, etc., and their prices are recorded. And also all

employees salaries, payments etc are maintained.

Sales Section:

The main product of K.S.S.K Ltd is sugar and by-products are bagasses,

molasses, press mud. These are all sold by calling tenders. Because the factory has no


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right to sale these products directly in the open market. The office superintendent does

this work and sales officer with the help of sugar directors office Bangalore Central

government fixes the selling quantity.

There are two types of sales,

a) Free sale 90% of the produced sugar.b) Levy sale 10% of the produced sugar.Free Sale

In this type, factory calls Tenders at a fixed rate. Highest bidder will get the

sugar. If rates are unsatisfactory they have right to reject the renders. The rate ofexcise duty, tax etc for the free sale sugar is Rs, 85 per quintal

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

Levy Sale

Year Sales (in quintals) Amount (in Rs)

2002-03 149555 171406019.50

2003-04 84233 98079216

2004-05 51312 75079253.95

2005-06 27634 44743060.30

2006-07 7619 10263232.30

2007-08 1244 105807.50


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According to the order of the Government, factory issues sugar to some Co-

operative societies at a fixed rate. This is called levy sale. The rate is fixed by Central

Government.

Comparative study of levy sale of sugar (Rs. 52 per quintal)

Year Sales (in quintals) Amount (in Rs)

2003-04 13345 16964674.45

2004-05 3187 4259162.35

2005-06 5201 7054271.33

2006-07 3146 4360805.42

2007-08 2035 105807.50


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SWOT ANALYSIS OF COMPANY

STRENGTHS:

1. Produces good quality of sugar.2. There is no any Sugar factory so there is little bit of monopoly in the purchase

of Sugarcane.

3. It is near the river of Varada so there is availability of sufficient water.4. K.S.S.K is not dependent on K.P.T.L for supply of power while production is

carrying on they generate power through rower.

5. It is awarded as largest sugar producer in Karnataka.

WEAKNESS:

1. Since it is agro based industry, monsoon affects its production.

2. Lake of good administration

3. Lake of infrastructure.

4. Backward technology and sophistication.

5. This company does not have its own website.

OPPORTUNITIES:

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


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Summary of The Latest Annual

Report of The Company

PROFIT &LOSS ACCOUNT OF FY07 AND FY08

(Rs. IN LACS)

PARTICULARS FY08 FY07

INCOME

Sales 57,013.33 48,794.17

Less: Excise Duty 12,550.13 9,384.19

44,463.20 39,409.98

Increase/decrease in stock 11,763.45 851.88

Other income 424.80 1,294.86

TOTAL 56,651.45 41,556.72

EXPENDITURE

Cost of raw material consumed & purchase of

Trading Goods

42,887.74 24,954..32

Manufacturing, Selling &Administration

Expenses

10,756.97 10,076.59

Interest & Finance Charges 2,370.63 1,852.60

Depreciation 3,392.94 1,672.37

Amortisation 49.51 18.03

TOTAL 59,457.79 38,573.91

Profit for the year before taxation (2,806.34) 2,982.81

LESS: Taxation

Income tax & wealth tax

Current year 0.00 350.00

Short/(Excess)Provision for earlier years 2.09 0.81

Deferred Tax Adjustment Debit/(credit)


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(804.46) 1,122.09

(802.37) 1,472.90

Fringe Benefit Tax Current Year 0.00 23.00

Short/(excess) Provision for earlier years(0.33) 0.00

TOTAL TAX (802.70) 1,495.90

Net profit for the year after tax (2,003.64) 1.486.91

Add profit brought forward from earlier year

604.93 647.07

Profit available for appropriation (1,398.71) 2,133.98

Appropriations

General Reserve 0.00 1,200.00

Dividend 0.00 281.25

Corporate Dividend Tax 0.00 47.80

Surplus Carried forward (1,398.71) 604.93

(1,398.71) 2,133.98

Basic & diluted Earnings per Equity Share of

Re.1 (1.78) 1.54


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BALANCE SHEET

(RS in LACS)

Particular FY08 FY07

SOURCE OF FUNDS

1.Shareholders fund

a..share capital 1,125.00 1,125.00

b..reserves and surplus 7,243.03 9,246.67

TOTAL 8,368.03 10,371.67

2.LOAN FUNDS

a. Secured loans 31,452.93 26,369.97

b. Unsecured loans 3,399.06 2,040.63

TOTAL 34,851.99 28,410.60

3.DEFERRED TAXATION(Net) 782.37 1,586.82

TOTAL 44,002.39 40,369.09

APPLICATION OF FUNDS

1.FIXED ASSET

a.Net block 19,318.65 21,529.68

b. Capital work in progress 296.36 51.72

TOTAL 19,615.01 21,581.40

2.Intangiable Assets 82.23 107.17

3.Investments 138.53 2,370.82

CURRENT ASSET,LOAN,ADVANCE

1.inventories 32,022.25 19,171.39

2.sundry debtors 2,958.47 2,999.54

3.cash and bank balance 2,665.18 1,928.08


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4.loans and advance 1,632.38 1,558.32

5.other current assets 2,067.28 3,350.53

TOTAL CURRENT ASSET 41,345.56 29,007.86

CURRENT LIABILITIES,PROVISION

1.current liabilities 16,305.45 11,216.28

2.provisions 873.49 1,481.88

TOTAL CURRENT LIABILITIES 17,178.94 12,698.16

NET CURRENT ASSET 24,166.62 16,309.70

TOTAL ASSET 44,002.39 40,369.09

RATIO ANALYSES:-

1. CURRENT RATIO= CURRENT ASETS/CURRENT LIABILITIES

Theoretically, the standard of current ratio is 2:1. But in practice, it changes

from industry to industry. If the current ratio is more than 1:1, it means to say that the

firm is in position of meet its short term obligations like creditors, bills payable, bank

over draft and the like. In KSSK LTD, the current ratio is 2.44 in FY 2007-08. But

current asset has been increased very marginally.

CURRENT RATIO CURENT ASSETS CURRENT

LIABILITIES

2.44 39,713.18 16,305.45


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

NET WORKING

CAPITAL RATIO

TOTAL CURRENT

ASSETS

TOTAL CURRENT

LIABILITIES.

2.44 39,713.18 16,305.45

Higher the ratio greater the ability of the firm to meet its current obligations

and vice-versa.KSSK LTD having 2.53 in 2007-08. If this ratio is more than 1 time

we can say that the firm is solvent.

3. DEBT-EQUITY RATIO =LONG-TERM DEBT/SHAREHOLDERSFUNDDEBT-EQUITY

RATIO

LONG-TERM DEBT SHAREHOLDERSFUND

0.35 2,958.47 8,368.03

In present case, the debt-equity ratio is less than one in both the years. So we

can say that KSSK LTD was a profit making company. Because EBIT was less than

one

4. PROPRIETARY RATIO=Owners fund/total assets.PROPRIETARY

RATIO

Owners fund Total assets

0.20 8368.03 41484.09

The proprietary ratio in 2007-08. This numbers indicates that if there is an Rs

100 worth of asset Rs 20 has been covered by owners fund and the rest of Rs 80 has

been borrowed to finance that asset.


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It determines the number of times stock is turned in sales during the

accounting Period under consideration. It expresses the relationship between the costs

of Goods sold and stock of goods.

Significance: It studies the frequency of conversion of stock of finished goods into

sales. It is also a measure of liquidity. It determines how many times stock is

purchased or replaced during a year.

8. FIXED ASSET TURNOVER = Net Sales/Net Fixed Assets

Fixed Assets Turnover: It is computed follows:

Fixed asset turnover = Net Sales/Net Fixed Assets

Fixed asset turnover Net Sales Net Fixed Assets

3.24 times 42491 13123


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LEARNING EXPERIENCE

I done my in-plant training in Karnataka Sahakari Sakkare Karkhane Ltd in

Sangur.,Haveri During in-plant training I had a good experience in KSSK Ltd Sangur

it was a great knowledge based and excellent training program . All the staff members

of KSSK Ltd were co-operative and friendly in their approach. Whenever I visited to

all the functional departments.

This 4 weeks corporate exposure and learning program conducted by the

DAVANGERE UNIVERSITY, had gained me a lot. This program helped me in

understanding the various functions of sugar industry and the Michael Porters

framework showed the organization aspects.

In every department whether it is a lower level or higher level the concerned,

staff given me all the necessary information whatever I required to learn. Overall its

been a good experience.

In the plant I had gone through various departments with interacting between

the heads of department then there only just I noted some of the aspects, which are

required to me.

It was more like a practical experience rather than theoretical i.e. I visited

some of the plants (manufacturing) section. And also able to see how day-to-day

functions are carried out. During this period, I met almost all the supervisory cadre

employees in their plant to get the relevant information whatever required for me.

Finally I had a great memorable experience for me that getting experience in

corporate environment. It is a good flat form for every post graduate management

student to get practical experience in corporate environment, and also to understand

how theoretical aspects are applied in actual workplace

I also learned organization culture, values, and attitude and Gained knowledge

regarding organizational functioning.


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