Hindustan Bio-energy Pvt. Ltd. … Creating Techno Green India

Presented By: AKR

VISION

We aspire to create a techno green India in the f ield of waste management for sustainable development of the environment with which society interacts.

By AKR

MISSION

To b e t h e l e a d i n g i n t e g r a t e d w a s t e management company - work ing in a competitive environment, delivering sustainable waste management solutions to meet the society needs. We are dedicated in creating competitive professionals and emphasizing on the sound economic development to its stakeholders.

By AKR

GOALS �  To comply with environmental laws and regulations and thus maintaining

corporate and departmental environmental monitoring programs to ensure compliance with governmental requirements

�  Provide a comprehensive service to manage waste problem and become a leading force in recovery and recycling of waste

�  Improve our environmental standing by turning waste into profit and provide our customers with exceptional waste collection, recycling and disposal services that protect, preserve and improve our environment and the quality of life in our community

�  To conduct our operations in a manner that demonstrates respect for the quality of the environment

�  To co-operate with central and state governments in analyzing emerging environmental issues, finding solutions to environmental problems, and developing cost-effective, scientific environmental standards

�  To maintain effective environmental procedures and equipment, consistent with available technology

�  To respond quickly and effectively to environmental incidents involving facilities, equipment, or products under our control

�  To provide environmental training programs for employees, emphasizing individual responsibility for sound environmental management By AKR

Our Customer Our customer ranges from:

�  Municipal Solid Waste (Limited Landfill) �  Biomass and Agricultural Wastes (Burn on Site – emissions

problems) �  Sewer Plant Sludge (Limited landfill availability) �  Medical & Hospital Waste (Hazardous Landfill) �  Refinery & Oil Processing Wastes (Hazardous Landfill) �  Used Tires (Hazardous Landfill, Local Nuisance, Fire Danger –

equiv fuel to coal) �  Food, Beverage, & Cosmetic Manufacturing Waste (Landfill

Disposal)

If it contains organics…it’s a fuel to us and a disposal problem solved for you !

By AKR

MACRO ENVIRONMENTAL ANALYSIS Macro Environmental

Sector  Trends   Impact on the Industry   Opportunity/ Threat  

Social  

Increasing health consciousness and awareness regarding waste disposal  

Positive impact on the industry growth  

Opportunity - will get support from society to bring this initiative functional  

Technological  More efficient waste disposal system  

Positive impact as the industry is bringing the latest technological innovation in the field of waste treatment  

Opportunity - more efficient and eco friendly system  

Economical  

Increasing currency exchange rate and inflation rates, which is increasing cost of goods  

The procurement cost of machinery and spare parts will increase  

Threat - the fixed cost and the maintenance cost will increase  

Political  

Government is getting sensitive towards increasing waste handling issue and supporting venture into the sector  

Positive impact on the industry growth  

Opportunity -to establish the industry and availed required support from the government  

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PORTER’S FIVE FORCES � THREAT OF NEW ENTRANTS

Item   Key  Threat of

Entry (TOE)  

Supply side economies of scale  

Supply side economies of scale are high.   LOW  

Demand side benefits of scale   The byproducts of this process are essentials required by petro chemical industries, pharmaceutical industries, power supply industries etc. Due to this, these industries can avail these products at lower prices. The demand side benefits of scale are high.  

LOW  

Customer switching costs   The switching cost of the customer is high as the other alternatives to waste disposal are relatively costly and do not abide by the environmental norms.  

LOW  

Capital requirements   The initial working capital in this project is very high and so new entrants should have enough on their hand to function in this market. Moreover if a company has capital intensive assets it can reduce their costs to a large extent but in its absence it has to depend on competitors who may take advantage of it.  

HIGH  

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Item   Key   TOE  

Incumbency advantages independent of size  

There is incumbency advantages as the technology used is advanced i.e. efficiency of this technology are 60% which helps in production of high quality by products. This may require huge initial investments but the price per unit of produced product reduces. As the raw materials are readily available by the municipality corporation of the city this results in further cost reduction. Moreover the location cost of the waste treatment plant is based on garbage disposal areas which further reduce the expenses.  

LOW  

Unequal access to distribution channels  

Since the existing distribution channels i.e. municipality corporations, electricity industries and petroleum industries are readily available in form of partnership projects, there is no unequal access to distribution channels.  

LOW  

Restrictive government policy  

There are no such restrictive government policies. Government encourages such projects in the form of public private partnerships. Moreover government encourages FDI into this market increasing competition.  

HIGH  

History of past retaliation   There is no such history of past retaliations in this market. Future retaliations may be in the form of more players entering into the market with advanced technology and proposing competitive prices on their product.  

HIGH  

By AKR

� POWER OF SUPPLIERS Item   Key  

Power of Suppliers (POS)  

No of suppliers relative to No industry players  

No of suppliers for the 70% of Machinery and spare parts is large in no compared to no of industry players.  

HIGH  

Cost (to industry players) of switching between suppliers  

The switching cost of supplier is very low as most of the machinery parts are standard parts and easily available in market.  

LOW  

Suppliers offer products that are differentiated  

Products offered by suppliers are mostly standard product, which mean it is not differentiated.  

LOW  

Substitutes to what the supplier group provides  

Substitutes for machinery and spare parts are easily available.  

LOW  

Suppliers can integrate forward into the industry  

supplier cannot integrate forward as the parts need to be assembled from different suppliers  

LOW  

Dependence of supplier group on the industry  

Supplier is less dependent on the company as those machine are general purpose and can be used in other functions as well  

LOW  By AKR

� THE POWER OF CUSTOMERS Items   Key  

Power of Buyers (POB)  

Number of buyers relative to number of industry players  

There are large numbers of buyers of the byproducts of the waste treatment plant. Mostly buyers are pharmaceutical industries, petro-chemical industries, cement industries, power generation industries, metal scrap industries etc. The number of industry players is relative low.  

LOW  

Buying volume per average transaction  

Each buyers volume is significant and due to discrete nature of the order (full order or no order), buyer has some level of bargaining power.  

HIGH  

The industry’s products are standard or undifferentiated  

The industry byproducts are standard although the waste management solutions offered by the company are differentiated.  

HIGH  

Cost (to the buyers) of switching between players  

There is no such switching cost associated with buyers as they can easily switch to alternative products at no cost.  

HIGH  

Buyers have a credible threat of integrating backward  

Presently no such buyer has integrated backward and so no such threat exists. But sometimes an aggressive buyer may integrate backward in order to avoid bargaining with suppliers.  

LOW  

The products it purchases from the industry represent a significant fraction of its cost or expenditures  

The waste management solution provided is of significant cost to the buyer. The byproducts also represent significant fraction of buyer’s expenditures.  

HIGH  

By AKR

� THE POWER OF CUSTOMERS

Items   Key  Power of Buyers

(POB)  

The customer group earns low profits, is strapped for cash, or is otherwise under pressure to trim its purchasing costs  

The customer group earns moderate profits and at the same time the expenses on the byproducts do not constitute significant part of the cost structure.  

LOW  

The quality of buyers’ products or services is affected by the industry’s product  

The waste management system would be considerably improved by providing the waste disposal solutions.  

LOW  

The buyer’s overall costs are significantly affected by the industry  

The buyer’s overall costs are not significantly affected by the industry.  

LOW  

By AKR

� THE THREAT OF SUBSTITUTES

Items   Key  Threat of

Substitutes (TOS)  

Substitutability of the industry’s product (availability and comparability of substitute’s price/performance)  

Substitutes are available in the form of disposal landfills which are becoming scarce and extremely polluting. Other substitutes are available to power generation industry, pharmaceutical industry etc. but are at higher costs which is a disadvantage.  

LOW  

Profitability of substitute product’s industry  

Moderate profitability of substitute product’s industry.  

HIGH  

By AKR

� RIVALRY AMONG EXISTING COMPETITORS

Item   Key  Rivalry within

industry  

The product or service lacks differentiation or switching costs  

The industry byproducts are standard although the waste management solutions offered by the company are differentiated.  

Not much rivalry  

Fixed costs are high and marginal costs are low  

Fixed cost is high in terms of huge investment in machinery  

HIGH  

Capacity must be expanded in large increments  

the capacity of the plant is easily scalable and there are means for intermediate product storage  

LOW  

The product is perishable  The product is not perishable.   LOW  

Competitors are numerous or are roughly equal in size and power  

competitors are few in no as in providing waste management solution, hence it stands low in competitors  

LOW  

Industry growth is slow  Industry growth is high due to invitations and support from government  

LOW  

Exit barriers   investment is huge hence exit barrier is high   HIGH   By AKR

KEY SUCCESS FACTOR �  What do Customers want?

(Analysis of Demand) *Low Price

*More Efficient waste disposal system *Clean environment *Environment friendly solution *Economical solution

�  How do Firms survive competition? (Analysis of Competition)

*High Fixed Cost *Excess capacity - easily scalable *Highly efficient technology *One stop solution provider *Economical - Intense pricing *Localization of plant

�  Key Success Factors Cost Efficiency Include:

* Low cost location * Easy scalable * Highly efficient technology * Environment friendly

 

By AKR

Appraising Resources RESOURCES CHARACTERSTICS

TAN

GIB

LE R

ESO

URC

ES

Financial

Require initial fixed investment of Rs. 3.5 Crore (estimated)

Debt Financing & Government funding under PPP model

ROI 25-30%

Physical

Plant and equipment: Technology used : Conversion through pyrolysis

Shredder, Pulverizer, freeze drying chamber, grinder, gasification furnace, steam mixing chamber, gas turbine.

Plant capacity: 10 tons of organic waste Raw materials: Organic and inorganic waste Location: near sewage water treatment plant

Land & building: on lease, private-public partnership with the government.

INTA

NG

IBLE

RE

SOU

RCES

Technology Pyrolysis Gasification

Reputation

Company’s reputation: Tie up with government

Maintaining cordial relationship with electricity boards & industries

Good relationship with suppliers

HUMAN RESOURCES

Training:

Train the skilled labour with the upcoming technology of waste treatment

Employees should be committed to add value to the organization and contribute in environmental up gradation.

By AKR

Organizational Capabilities Function   Parameters   Capabilities  

Corporate Management  Financial Management   Yes  

Coordinating business units   No  

MIS  Speed and responsiveness through rapid information transfer   No  

R&D  Research capability   No  

Development of innovative new products   Yes  

Manufacturing  Efficient volume manufacturing   Yes  

Flexibility   Yes  

Design   Design capability   Yes  

Marketing  Quality reputation   Yes  

Responsiveness to market trends   Yes  

Sales, Distribution & Service  Efficiency and speed of distribution   Yes  

Customer Service   Yes  By AKR

Value Chain Legal  support Financing  through  debt

Skilled  &  unskilled  workforce,  contractual  

workforceSkilled  workforce Skilled  workforce

Pirolysis  Gasification  

Land,  Infrastructure  and  Machineary

bio  degradablenon-­‐biodegradebledomestic  wastemedical  waste  industrial  wastesludge  waste

treatment  according  to  category  of  waste

transportation  service  of  municipal  corporation

syn  gas,electricity

slagB2B    marketing waste  mgmt.  solutions

INBOUND  LOGISTICS OPERATIONS OUTBOND  LOGISTICS MARKETING  &SALES SERVICES

Primary  Activities

AccountingFIRM  INFRA  STRUCTURE

HR  MANAGEMENT

TECHNOLOGY  DEVELOPMENT

PROCUREMENT

Support  Activities

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Resources & Capabilities as Basis for profitability

Rate

of P

rofit

In E

xce

ss o

f the

Co

mp

etit

ive

Le

vel  

Ind

ustr

y A

ttra

ctiv

ene

ss  

Barriers to entry  

Patents   No Patents  

Brands   No existing branding  

Retaliatory capabilities   -  

           

Monopoly   Market share   Possibility of high market Share  

           

Vertical bargaining power  Firm size      

Financial Resources    Public Private Partnership  

               

Co

mp

etit

ive

Ad

vant

ag

e  

Cost Advantage  

Process technology   Yes  

Size of plants   Land area: 12000 sq. feet is sufficient  

Access to low-cost inputs   Yes  

           

Differentiation Advantage  

Brands   No existing branding  

Product technology   Yes  

Marketing, distribution   Yes  

Service capabilities   Yes  By AKR

Summary:

�  “HB Pvt. LTD.”(Hindustan Bio-energy private limited) aims at creating wealth and jobs by building a new energy economy from organic waste. Company works in the field of generating bio-energy through pyrolysis.

�  The HB Bio-waste to energy is a vision of building a better India and a better world. Hundreds of thousands of tons of waste are discarded every day. Some of it is recycled. Most of it winds up in landfills. These landfills are scars on our planet that is prone to disappear for thousands of years.

�  Currently, in metropolitan and semi-metropolitan city, restaurants spend huge sums of money on food products that quite often wind up in the trash. That trash, in turn, feeds millions of cockroaches and rats that spread filth and disease in the city.

�  Our mission is to utilize these trashes of restaurant – organic waste in order to create a system that is financially and environmentally beneficial.

“Let’s create a Techno Green India”

By AKR

Thank You

By AKR