havells project.. lokesh
TRANSCRIPT
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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