1 A REPORT ON ORGANISATION STUDY ATPHILLIPS CARBON BLACK LIMITED

Submitted to the

MAHATMA GANDHI UNIVERSITY

In partial fulfillment of the requirements for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

Submitted by

SINTOJ THOMAS

Reg. No. ……………

Under the guidance of

MR.DAWN JOSE

Assistant professor

SJCET SCHOOL OF MANAGEMENT

ST. JOSEPH’S COLLEGE OF ENGINEERING AND TECHNOLOGY, PALAI.

MAY 2011

1

SJCET SCHOOL OF MANAGEMENT

ST. JOSEPH’S COLLEGE OF ENGINEERING AND TECHNOLOGY

BONAFIDE CERTIFICATE

This is to certify that this report titled Report on’ Organization study at Phillips carbon

black td’ is the bonafide work of Mr. Sintoj Thomas. Who carried out the study under my

supervision. This report is submitted to Mahatma Gandhi University, Kottayam as partial

fulfillment of requirement for the award of degree of Master of Business Administration.

Dawn JoseFaculty Guide

------------------------------------------- ---------------------------------------------Prof. G. M. Tharakan Signature of PrincipalHead of the Department

Submitted for the Viva Voce examination held on ________________________

Signature of External Examiners

1. ------------------------------------------ 2. ---------------------------------

2

DECLARATION

I , Sintoj Thomas hereby declare that the report entitled “organization study

at Phillips Carbon Black” submitted to Mahatma Gandhi University in

partial fulfillment of the requirements for the award of the degree of Master

of Business Administration is a record of original work done during my

period of study in the School of Management, St. Joseph’s College of

Engineering and Technology under the guidance of Mr. Dawn Jose, Asst.

professor.

Sintoj ThomasPlace: PalaiDate:

3

4

ACKNOWLEDGEMENT

The satisfaction of the successful completion of any task wouldn’t be complete without

the expression of gratitude to the people who made it possible. This task would have been

difficult for me if I had not received the support and encouragement from the people who

have helped me from the inception to the completion of this project work.

I would like to express my heartfelt gratitude to Prof. C J Joseph Principal

St. Joseph College Of Engineering And Technology and Mr. G M Tharakan, Head of the

Department who provided me with all help, co-operation and encouragement to complete

my study.

I express my sincere thanks to the faculty guide Mr. Dawn Jose, Asst. Professor for his

valuable guidance and support.

I wish to express my sincere gratitude to the authorities of Phillips Carbon Black Ltd.

who has been kind enough to permit me to pursue this organization centered study at

their esteemed organization. I would like to thank Mr. Babu Abraham, Head of HR

Department of PCBL. Who guided me at all stages through this project with plenty of

data. Finally I wish to express my heartfelt thanks to all staff of the organization for their

suggestions and guidance. I would like to thank God Almighty for being the guiding light

in my entire task and being with me throughout this journey.

SINTOJ

THOMAS

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6

CHAPTERS

Chapter-1

chapter-2

Chapter-3

Chapte-4

Introductionobjectives of studyscope of the studyresearch methodologylimitation of study

industry profilecompetitors detailsworld scenarioIndian scenarioState scenario

Company profileHistory and PhilosophyProduct rang of company BCBL Financial performance of the companyOrganizational structure

Department details

1-Finance department

StructureFunction Objectives

Financial summaryFinancial highlightsResponsibilities of key person

Page No.

14456

712131517

19232629

31

323334353637

7

INDEX

8

2-Purchase and storage department

Department structureFunction of purchase and storce departmentPurchase procedureResponsibilities of store &purchase manager

3 –Production

Structure of the departmentFunction of the departmentObjectives of the departmentDuties and Responsibilities Production processProduct identification4-HR department

StructureFunctions of HRRoles of HR4-Maitance and engineering department

StructureObjectivesProcessed followed by Maintains Department

6-Warehouse department

Structure

38

3940

42

444546484953

545558

6061

62

63

9

Chapter-5

Chapter-6

7- Logistics department

8-Environmental department9-R&DMarketingCaptive power plant

SWOT analysisObservation and suggestions

Conclusion Bibliography

LIST OF FIGURES

Fig-1,Organizational structureFig-2, Finance department structureFig-3, Purchase and stores Fig-4, Production department structureFig5, Production processFig-6, HR department structuredepartment StructureFig-7,Maintenance department structureFig-8, Warehouse department structureFig-9,Logistics department structureFig-10,R & D department structure

65

66676970

7172

7576

31323844

50

54

60

636567

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.1 INTRODUCTION

An organization is a social arrangement which purpose collective goals, controls its

own performance, and has a boundary separating it from its environment. Organizational

structure is a mainly hierarchical concept of subordination of entities that collaborate and

contribute common aim. .

Organizations are a variant of clustered entities. An organization can be structured in

many different ways and styles, depending on their objectives and ambience. The

structure of an organization will determine the modes in which it operates and performs.

Organizations are a variant of clustered entities. An organization can be structured in

many different ways and styles, depending on their objectives and ambience. The

structure of an organization will determine the modes in which it operates and performs.

Philips carbon black has come a long way since its inception in 1960. PCBL started

production from December 1962 by oil furnace the most widely accepted manufacturing

process of carbon black patented by its then collaborator and world carbon black leader

Philips Petroleum Company USA The collaboration ended in 1978. However PCBL

continued its progress by virtue of the ingenuity of its technologists, engineers and

sustained R&D activities. In 1988 PCBL entered into a technical agreement with

Colombian Chemicals Company, USA, and acquired access to modern state of the art

carbon black technology. This resulted in company gaining flexibility, product range

production capacity and energy conservation.

Carbon Black along with natural rubber accounts for more than 80% of the cost of

tyre. It imparts anti abrasion quality and enhances the tensile strength of rubber. Carbon

black is also used in industries such as automotive parts, construction and consumer

products. It has applications in printing inks, coatings, electrical cables, plastic films,

pipes. It is used to manufacture dry cell batteries. Coal tar and petroleum cokes are the

11

principle raw materials used in the carbon products industry. These materials are by

products of refining and other coal and oil processing operations. Phillips Carbon Black

Limited, part of RPG group, pioneered the carbon black industry in India. It is now the

leading producer of carbon black in the country and 9th largest carbon black company in

the world.

The company is not only the largest exporter of carbon black in India but also one of the

largest in Asia in its field. Currently export sales stands around 20% of the total sales.lt

supplies to international tyre companies such as Bridgestone, firestone, Dunlop and

Goodyear.

PCBL is setting 90,000 tons per annum (tpa) capacity plant along with a 16 mw power

plant at Mundra at an investment of Rs.220 core. Capacity of 50000 tones along with a 14

mw power plant will be added at Kochi at an investment of Rs.140 corer. These

investment requirements would be met through debt and internal accruals.

PCBL is also setting up a 55,000 tpa capacity carbon black plant along with a 16 mw

power plant in Vietnam at an investment of US $ 46 million. Rising crude oil prices is a

major concern for the company. In the past the company was not able to pass on the rise

in the raw material costs to its customers. But now with the escalation clause built into

the contract, the company has passed on the risk to some extent to the buyers.

WHAT IS A CARBON PRODUCT?

Essentially any organic material can be thermally transformed to carbon. The

carbonization process uses heat to convert organic precursors into a carbon polymer.

Some selected precursors can then be transformed into a three-dimensional graphite

structure or near graphite structure. Differences in the properties of final carbon products

depend on the raw materials used on the extended of completion of overall chemical and

physical ordering processes and upon whether the thermal transformation takes place

from the vapour, liquid or solid phase. Carbon products can be grouped according to the

12

extent of material processing raw material, carbon precursors and finished carbon

products. Coal tars and petroleum cokes are the principal raw material used in the carbon

products industry. These materials are bi-products of refining and other coal and oil

processing operations. In the United States, approximately. Million metric tons of coal tar

and 24 million metric tons of petroleum cokes are produced each year.

Pitches and cokes, which are derived from coal and petroleum tars or heavy aromatic

liquids, are the two main carbon precursor’s materials from the production of bulk carbon

and graphite products and for the manufacture of carbon blacks. Pitches have a glass like

character and cokes are carbon industry vision infusible solids. Bulk carbon and graphite

products such as electrodes are produced by first blending calcined as a filler and liquid

pitch

as a binder. This “green” material is then thermally processed through a series of

progressively higher temperatures to achieve the final desired properties. Petroleum coke

is the largest single precursor material in terms of quantity for manufactured carbon and

graphite products. Approximately 10 million tons were consumed worldwide in 2010.

Other precursors include natural graphite, hydrocarbon gases, carbon blacks, anthracite

and synthetic resins. Carbon blacks are nano cale carbon particulates produced by

pyroloysis of feed stock from the vapor phase with homogeneous nucleation of solid

carbon.

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1.2 OBJECTIVE OF STUDY

The following are the specific objectives of my organization study.

To study about Phillips Carbon Black Limited, Kochi and understand the day to day

activities of an organization.

To observe how management theories are applied and practiced in real business

environment.

To learn the functions of all departments.

To understand the organization and department structure.

To understand role and responsibilities of key persons in the organization.

To have a general idea on the basic business operations of an organization.

To experience the organizational processes at various levels.

1.3 SCOPE OF STUDY

The organization study is conducted at Phillips carbon black, cochin, for a period of one

month from 2nd may 2011 to 30th may 2011. The following departments are studied in detail: -

Finance Department, HR Department, Production Department, Purchase and storage

Department. The study is largely based on secondary sources. The main objectives are to learn

about the functioning of the organization, its departments and staff members. The study is

undertaken a part of curriculum to fulfill the the requirements for the award of MBA, MG

university.

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1.4 RESEARCH METHODOLOGY

Methodology is a procedure or technique adopted in a research study or investigation.

Many methods and procedures have been developed and employed to meet the needs of

these searches in gathering varied facts essential for my study thus forming conclusions

from different sources. In every price of research different methods are used in different

stages of its development. The selection of method for research work depends upon the

nature of the problem.

SOURCES OF DATA

For the purpose of analyzing the overall performance of Philips carbon black Ltd the

investigator used primary data and secondary data.

PRIMARY DATA

Primary data refers to those data, which do not exist already in the records and

publications. For the purpose of collecting primary data the investigator conducted an

interview with every departmental employees and department heads of Philips Carbon

Black Ltd. Addition information were gathered through observing the activities of the

departments and the employees.

SECONDARY DATA

Secondary data refers to those data, which exist already in the records and

publications and website.

Company journals and documents

Company website

Annual report ,etc

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1.5 LIMITATIONS

Time allotted for the study is limited.

The investigator could not gather all the details regarding the production process an most

of the process are technical in nature.

The study is largely based on secondary data.

Did not get enough time to communicate with all the employees in the

organization.

As the primary sources are based on interaction with the employs chance of bias

cannot be fully estimated.

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2.1 I NDUSTRY PROFILE

Carbon Black is used mainly as a reinforcing material in the rubber industry.

Other user areas include inks, paints, plastics and paper. The rubber industry uses

95% carbon black production while the rest is consumed by plastics, paints and dry

cells.

Close to 50%of global market is currently controlled by the top three companies –

Cabot Corporation, Degussa and Columbian chemicals. The units manufacturing rubber

grade oil furnace carbon black in India include:

Phillips Carbon Black Ltd. (Durgapur, Baroda, Cochin)

United Carbon Ltd, thane

Oriental Carbon Ltd, Ghaziabad

Consolidate Petrotech Industries Ltd, Baroda

Ralson Carbon Ltd ,Ludhiana

Hi-tech Carbon Ltd,

World carbon black demand is forced to rise 4.2 percent per year through 2012 to

eleven million metric tons, bolstered by a healthy global rubber market over the same

period. The vast majority of carbon black finds use as reinforcement in vulcanized rubber

goods, including around two-thirds for tires alone. Carbon black demand from the tire

sector is projected to increase 4.2 percent per year through 2012 to 7.1 million metric

tons. The smaller non tire rubber carbon black market will expand 4.0 percent per year

through 2012 to 2.8 million metric tons. The Asia /pacific region, excluding Japan, will

post the strongest gains in carbon black demand through 2012. The large market of China

and India will post particularly impressive gains due to a continuing rapid expansion in

their respective motor vehicle and tire industries. North America and Western Europe,

which produced close to half of the world carbon black in 1996 will account for just 28

17

percent in 2012. Conversely, the Asia/specific region which produced 36 percent of the

world carbon black in 1996 will provide 51 percent in 2012. The overall global carbon

black market is expected to increase by 4 percent per year to a level of 9.6 million metric

tons through 2009, according to a study conducted by Cleveland–based the Fredonia

Group, Inc.

Industry application

Aluminum production

In aluminum industry the major application of carbon black includes in the

production of anodes, cathodes and sidewall in the Hall Heroult primary aluminum cell.

Advantages of using the carbon black in the aluminum industry include: resistance to

corrosion, resistance to thermal shock, high thermal conductivity, low porosity, high

operating strength, electrical conductivity, dimensional stability.

Steel production

Carbon black used in steel industry includes in the production of electronics for

producing molten steel, iron and other alloys. It also used in the production of carbon

black for hearths and furnace walls and crucibles. Advantages of using carbon black in

steel industry include carbon black hearts and furnace walls, crucibles, pressure casting

electrical conductivity, resistance to thermal shock, high thermal conductivity, and

dimensional stability.

Glass making

Carbon black is used in glass industry in the production of furnaces, crucible and

handling mechanisms. Advantages of using carbon black in glass industry include:

resistance to thermal shock, dimensional stability.

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Environmental Application

Environmental application of carbon black includes in the carbon filters for water air

purification filtration for industrial, municipal and automotive applications. Advantages

of using carbon black in this area include mesosphere micro beads, veratiland

controllable porosity, tailored chemically reactive surface, provides large surface area.

Chemical production

Application of carbon black in chemical industry includes in the production of

reaction vessels, heat exchangers, pumps, pipe fittings and valves, porous graphite filters.

Advantages of using carbon black in chemicals production includes resistance to

corrosion, high thermal conductivity, tailored chemically reactive surface, low

permeability ,electrical conductivity.

Aerospace Application

In the field of aerospace the carbon black is used in the production of nose cone,

airframe structure, breaks, rocket nozzles etc. Advantages of using the carbon black in

aerospace application include; high strength to weight ratio, resistance to thermal shock

etc.

Metal fabrication

In the area of metal fabrication, carbon black is used in the production of high

temperature rollers, dies, tooling, and electrodes for electrical application, discharge

machine. .advantages of using carbon black in the area includes resistance to thermal

shock, resistance to correction, high thermal conductive, mechanical strength.

Nuclear power

In the field of nuclear energy carbon black is used in the production of various

equipment’s such as nuclear moderators and reflectors, thermal columns, various

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constriction materials, graphite coated fuel pellets etc. advantages of using carbon black

in nuclear power include; low neutron capture cross section, high strength etc.

Electronics

In the field of electronic carbon black is used in the production of various

equipment’s such as capacitors, batteries, heat sinks, electromagnetic shielding , heating

elements for semiconductor manufacturing etc. Advantages of using carbon black in

electronics field include electric conductivity, dimensional stability, resistance to thermal

shock, high thermal conductivity, light weight etc.

Sliding contact mechanical application

Carbon black is an essential ingredient in the manufacturing of sliding contact

mechanical equipment’s such as such as bearing, seals, vanes, bushes, wearing and

brushes etc. Advantages of using carbon black in the sliding contact equipment’s Include:

lubricity, strength dimensional stability etc.

Recreational products

In the field recreational also carbon black finds its application in the production of

tennis rackets, skis, bicycles, sailboats etc. advantages of using carbon black include:

high strength to weight ratio, fabrication versatility, high stiffness to weight ratio etc.

Infrastructure

The applicable properties of carbon black find its advantages in the area of insracture

and the qualities include: seismic retrofit of beams and columns, extinction of bridges,

high strength to weight ratio, resistance to fatigue and vibration etc.

Transportation

In the field of transportation the carbon black finds its place in the production of

automotive structures, rotating components etc. advantages of using carbon black in the

transportation field include: fabrication flexibility, high stiffness etc.

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Rubber products

Carbon black finds its major use in the field of rubber products. It is used the

manufacturing of tires and rubber. Advantages of using rubber products include; structure

particulates of controlled morphology, readily wet by rubbers, thermal stability,

mechanical robustness etc.

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2.2 Competitor’s details of PCBL

Company

Sales

(Rs.

Million)

Current

Price

Change

(%)

P/E

Ratio

Market

Cap.(Rs.Million)

52-Week

High/Low

Phillips Carbon 12325.74 135.10 0.78 3.83 4452.82 242/113

Orient Car 1257.06 122.50 -0.65 3.46 1269.50 161/100

Cabot India Ltd. 2592.77 99.55 0.00 0.00 869.91 0/0

Goa Carbon 2507.16 84.50 -0.59 8.46 777.84 115/63

Murablack India 0.00 1.80 0.00 0.00 52.00 0/0

Guj.Carbon 0.00 3.99 2.84 0.00 49.40 6/2

Data source: annual report 2010

2.3 WORLD SCENARIO

As one of the most important industrial chemicals in the world carbon black represents a $

8.8 billion global market. Close to 50% of the global market is currently controlled by the 3

22

companies;

Cobot Corporation

Degussa

Columbian Chemicals

World carbon black was forecasted to rise 4.2% per year through 2011 to eleven million

metric tons with the major applications in rubber, plastics, inks etc. The Asia-pacific region

account for 50% of global demand for carbon black and 47% is almost divided between America

and Europe, whereas demand from Africa and middle east is less than 3%.

China and India registered double digit demand growth strong rise in the carbon black

industry. The Asia-Pacific region, excluding Japan posted the strongest gain in carbon black

demand through 2011.The vast majority of carbon black finds use as reinforcement in vulcanized

rubber woods including around two - thirds for tyres alone.

Due to the investment in road infrastructure and increasing vehicle population, the rest of

the world clocked 3.5% growth.

Phillips Carbon Black does, however the company has invested in a means of converting this

23

waste into energy and financial savings. The India based company has announced the

commissioning of its 30 MW co-generation power plant Durgapur, in the state of West Bengal.

The Rs 1 billion (£11.6 million) facility, which utilizing the waste gas produced during the

process to generate power, was commissioned on September 29.

An RPG Enterprises group (who also owns tyre manufacturer Ceat) company, Phillips Carbon

Black is India’s largest, and the world’s seventh largest, manufacturer of carbon black, and the

company sells carbon black to almost every tyre company in India. Its three plants currently

account for 70 per cent of India’s installed capacity. The company is also Asia`s largest exporter

of the commodity.

Other current company projects include the construction of a new 80,000 tone carbon black

production facility in Mundari, India, commissioned on March 2010 and a 100,000 tone facility

in Vietnam.

2.4 INDIAN SCENARIO

In India, the recent slowdown in the automobile sector and its cascading effect on tyre

affected the demand for carbon black. Since the demand is not very comfortable the cost is also

24

not encouraging. The recent depreciation in the value of the rupee versus the dollar also

compounded the problems of the domestic users.

PCBL has been continuously upgrading the technology. The processes in Durgapur & Cochin

Units are controlled by most advanced Distributed Control Systems symbolizing the essence of

state-of-the-art technology. The company uses latest equipments from world’s best manufacturers

like – M/S. Chronos Richardson’s (UK), Rekuperator AG (Germany), and Delmonico (Italy).

PCBL has three manufacturing units located in Durgapur, Cochin (Southern India) and Baroda

(Western India). The production capacity of the three units put together is almost 47% of the total

installed carbon black capacity in India; that of Durgapur unit alone accounts for 24%.

PCBL Durgapur Unit has now a production capacity of 1, 35,000 MT per year with a

proven capability to produce 24 grades of carbon black through successive stages of

modernization and expansion. It is ISO-9001 certified, and is the only Carbon Black

manufacturer in Asia to have achieved this distinction. The Durgapur unit has also received the

QS-9000 in December 2000, and has initiated the Environmental Management System (EMS)

activities for receiving ISO 14001 Certification. Cochin plant obtained ISO 9002: 1994

Certificate in 1998, which was followed soon after by that of the Baroda plant. Cochin Plant has

also bagged the Environment Management System (EMS) standard accreditation under the

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14001: 1996.

PCBL acquired M/s Gujarat Carbon & Industries Limited (GCIL) Baroda in November 1996

and M/s Carbon and Chemicals India Limited (CACIL) was merged with PCBL with effect from

1st April 1997 with the twin objectives of increasing volumes and proximity to certain key

customers. A capacity expansion was undertaken in 2004 to take the plant capacity at Baroda to

90000 MT/Annum.

The rubber industry uses a total of 95% of carbon black production while the rest is consumed

by plastics, paints and dry cells. In domestic market, the company is regular supplier to all the

major tyre manufacturers and has an overall domestic share of around 40%. PCBL continues to

be the the undisputed leader in the field of carbon black in India.

The major players in the Indian scenario are:-

Phillips Carbon Black Ltd (Durgapur, Baroda, Cochin).

United Carbon Ltd, Thane.

Oriental Carbon Ltd, Ghaziabad.

Consolidated Petrotech Industries Ltd, Baroda.

Ralson Carbon Ltd, Ludhiana.

Like other countries, in India, carbon black is used in:-

Aluminum production.

Steel production.

Glass making

Environmental application.

Chemical production.

Aerospace application.

Metal fabrication,

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Nuclear power,

Electronics.

Recreational products,

Infra structure.

Rubber products.

2.5 STATE SCENARIO

Philips Carbon Black Ltd, part of the RPG Group, has planned to expand its carbon black

manufacturing unit at Kochi in Kerala. The Rs 160-crore project involves capacity expansion

from the current 125 tons per day to 280 tons per day by September next year. The annual

capacity of the plant will increase from 40,000 tons to 90,000 tones. The incremental capacity

will be used largely to produce soft carbon black that has more demand.

To meet the additional power requirement, the existing captive power plant capacity will be

stepped up from 2.5 mw to 14 mw. Surplus power, after meeting the requirements of the new

capacity, will be exported to the grid. A senior official of PCBL in Kochi said that land was

already in possession and preliminary work on the project had begun. He also noted that the

company's overall carbon black making capacity would increase to 3.1 lakh tpa once the Kochi

expansion went on stream.

Major players in the Kerala scenario:

Phillips Carbon Black Ltd

United carbon ltd, thane

Oriental carbon ltd, Ghaziabad

27

The key customers are;

MRF.

Apollo Tyres.

Ceat Tyres

JK Tyres..Etc.

3.1 COMPANY PROFILE

Philips Carbon Black (PCBL), a member of RP Goenka Group was incorporated on March

30, 1960 and is a leading manufacturer of various grades of carbon black in India. Columbian

Chemical Corporation, US, a leading international producer of rubber blacks is the Technical

28

Collaborator of the company. Carbon Black which is an main raw material in the production of

automotive trye is produced using carbon black feedstock (CBFS) and tar oil. The company has its

manufacturing facility in Durgapur, West Bengal, at a installed capacity of 1, 75,000 tpa. The

company has a well-organized distribution network and its consignment agents cover the entire

network of tyre manufacturing units, tyre re-treading units and other consumers all over the

country. The company has four subsidiaries - Carnival Investments, Transmission Holdings, South

Asia Electricity Holdings, and PCBL Industrial Finance.

PCBL is the first manufacturer of carbon black in India to receive the coveted ISO-9001

certificate covering the manufacturing, marketing and designing functions. PCBL came out with

an issue of equity shares at a premium of Rs. 30 aggregating Rs. 33.53 cr in Feb. '94. In 1996-97,

Carbon and Chemicals India Ltd was amalgamated with the company. Due to an accidental

release of carbon black smoke, the company was forced by the KPCB to close its Cochin factory.

The company's production as well as the exports was also affected due to this closure of unit. After

a disruption of 3 months the production was restored. To meet its annual demand the company has

shifted its 10000 MT ideal capacity from Cochin to Durgapur. Simultaneously de-bottlenecking is

also in progress at Durgapur. This should increase annual capacity by 15000 MT per annum at

Durgapur.

Philips carbon black, part of the RPG group pioneered the carbon black industry in India. It is

now the leading carbon producer in the country. PCBL enjoys 41% of market share in India. It is

also one of the leading carbon exporters in India. It is the first carbon black company in the world

to be awarded carbon credit under Kyoto Protocol of UNFCCC.

PCBL was formed in the year 1960 by Phillips Petroleum Company, a major oil company and

a leading manufacturer of carbon black in USA. Phillips carbon black has come a long way since

its inception in 1960. PCBL started production from 1962 in collaboration with the world carbon

black leader, Phillips Petroleum Company, USA. The collaboration ended in 1978.

COCHIN UNIT

29

Company Address: Phillips Carbon Black Ltd.

Karimugal

Brahmapuram P.O

Cochin-682303

Name: Phillips Carbon Black Limited

Registered Office: 3 l, N.S.Road, Kolkata-700001

Corporate Office: 3 l, N.S.RoacLKolkata-700001

Date of incorporation: March 31 1960

Sector: Private

Constitution: Public Limited Company

Production capacity: 40000 MT p. a

Turn Over: 140 Cores p. a

Total number of Employees: 148

Management Staff: 62

Non-Management staff: 86

Hours of work: 8 hrs

The company is considering various proposals in the field of electronics. The subsidiaries of the

30

company are:-

The On share Investments Ltd.

Carnival Investments Ltd.

Philcarb Investments and Industries Ltd.

Philcarb Industrial Finance Ltd.

PCBL Industrial Finance Ltd.

MISSION

Develop, manufacture and market carbon black competitively and be the most preferred supplier

to the customers and create wealth for all the stakeholders on a sustained basis.

VISION

To be a global carbon black producer.

Manufacturing with low cost.

To be environment friendly operation by being;

Providing fair employee an exciting work place.

COMMUNITY INITIATVES

Pipeline for drinking water for school.

Free distribution of books. '

Merit award.

Secured landfills for hazardous waste disposal.

Rain water harvesting.

QUALITY POLICY

It includes;

31

Consistently meet the requirements of product specification.

Upgrading technology and business process to meet the changing needs

of the customers.

To be an environment friendly organization.

PCBL honors and recognizes performance through;

An aggressive performance management system.

Awards for outstanding performance.

Organization and management reviews process at Management

Committee level that reviews the status and progress.

.

FACILITIES

Officers colony.

Playground.

Swimming pool.

3.2 History and philosophy

Phillips Carbon Black, established in 1960 and a part of the RPG Group pioneered the carbon black

industry in India. It is now the leading producer of carbon black in the country.

PCBL started production from December 1962 by the oil furnace technology; the most widely

32

accepted manufacturing process of carbon black patented by its then collaborator and world carbon

black leader, Phillips Petroleum Company, USA. The collaboration ended in 1978. However, PCBL

continued its progress by virtue of the ingenuity of its technologists, engineers and sustained R&D

activities. In 1988 PCBL entered into a technical agreement with Columbian Chemicals Company,

USA, and acquired access to the modern state-of-the-art Carbon Black technology. This resulted in

the company gaining flexibility, product range, production capacity and energy conservation.

RPG Group recognizing the major turnaround achieved during the last two years and the growth

path PCBL has embarked upon to capture the opportunities in Carbon Black business has made

Carbon Black an independent Business Sector with effect from August 1, 2008.The company’s

present installed capacity is 270,000 MTPA. The company is not only the largest exporter of Carbon

Black from India but is also one of the largest in Asia in its field.

The company has taken advantage of the newly introduced Electricity Act of 2003 to set–up a 12

MW co-generation power plant at its Baroda plant using the offgas. After meeting the internal

demand for production of carbon black, the surplus power of around 7 MW – 7.5 MW is being sold

to the GEB Grid from end March, 05. State of the art Enterprise Resource Planning system SAP was

implemented in conjunction with the internationally renowned consultants, M/S Accenture as the

implementing partner. SAP is functioning satisfactorily.

PCBL acquired Gujarat Carbon & Industries Limited (GCIL) Baroda in November 1996 and

Carbon and Chemicals India Limited (CACIL) was merged with PCBL with effect from 1st April

1997 with the twin objectives of increasing volumes and proximity to certain key customers. A

capacity expansion was undertaken in 2004 to take the plant capacity at Baroda to 90000

MT/Annum.

The rubber industry uses a total of 95% of carbon black production while the rest is consumed by

plastics, paints and dry cells. In domestic market, the company is regular supplier to all the major tyre

manufacturers and has an overall domestic share of around 40%. PCBL continues to be the

undisputed leader in the field of carbon black in India.

Encouraged by the success of the Baroda co-generation power plant, the company is setting up a

33

30 MW co-generation power plant at its Durgapur plant utilizing the off gas for generation of power.

The internal consumption would be around 6 MW and the surplus power would be sold to interested

consumers. PCBL has three manufacturing units located in Durgapur, Cochin (Southern India) and

Baroda (Western India). The production capacity of the three units put together is almost 47% of the

total installed carbon black capacity in India; that of Durgapur unit alone accounts for 24%.

Products manufactured by the company include:

The company designs, manufacturers and markets carbon black. The major market for Carbon

Black is Tyre Industry. Carbon Black is also required by Non-Tyre rubber based application industry

as well as the plastic industry.

PCBL has capability & flexibility to produce any ASTM grade in addition to the grades mentioned

above. Besides ASTM grades, PCBL also manufactures customized product specific to a customer.

The company is the largest manufacturer and supplier of carbon black in the country catering to the

needs of elastomer, plastic, paints and ink manufacturing industries.It also manufacture Special Black

for non-rubber applications

Achievements/ recognition :

• The company has bagged prestigious awards like coveted ICMA Award for novel energy

conservation in chemical plants of the country.

•The company has bagged CHEMTECH foundation Award for wealth from waste.

•In 1997, it has also won the “best company of the year” award for all round performance within the

RPG companies.

•Award for second best safety and housekeeping practices was awarded (in 1995 for PCBL

Durgapur).

•It is ISO-9001 certified, and is the only Carbon Black manufacturer in Asia to have achieved this

distinction.

34

•The Durgapur unit has also received the QS-9000 in December 2000, and has initiated the

Environmental Management System (EMS) activities for receiving ISO 14001 Certification.

•Cochin plant obtained ISO 9002: 1994 Certificate in 1998, which was followed soon after by that of

the Baroda plant.

•Cochin Plant has also bagged the Environment Management System (EMS) standard accreditation

under the 14001:

3.3 PRODUCT RANGE OF PCBL

PCBL manufactures around 20 different grade of carbon black and is the 8th

largest manufacturer in the world. The following tables give a snap short of the various

grades manufactured by PCBL, major applications and properties of carbon black.

35

Sl .no. Grade Properties Major applications

1 N-110 Highest tensible strength,

Abrasion and tear strength,

OTR, heavy duty rollers,

Tank treads,

Mechanical goods.

2 N-115 Excellent tensible strength,

Abrasion and tear strength,

Aero tyre and special

application

3 N-220 Good tensible strength,

Abrasion and tear strength,

Tyre tread, retreading,

mechanical goods, heavy

duty belts.

4 N-231 Higher modulus Tyre tread, retreading,

mechanical goods, heavy

duty belts, suitable for

Higher friction

5 N-299 Exceptionally smooth extrusion Premium quality truck

tread,

Belting and other

extruded products.

6 N-234 Good tensible strength and

abrasion resistance with very high

modulus.

Racing and radial tyre

tread

7 N-219 Good tensible strength and

abrasion resistance.

Industrial rubber goods,

OTR, heavy duty belts.

8 N-326 Better resistance to chipping and

cutting, gives very good tensile

strength.

OTR, tyre, v belt, skim

and mechanical goods.

9 N-330 Widely used because of its

balanced properties, imparts

Tyre trade, side wall,

Retreading, conveyer

36

goods modulus, tensile strength,

abrasion resistance.

belts etc

10 N-339 High modulus tensible strength

and abrasion resistance.

Passenger tread tyre ,

inner butyl tubes,

conveyer belts cover.

11 N-347 High structure provides improved

processing, ease of dispersion,

high modulus.

Tyre treads heavy duty

belts, wire and cable

jacketing.

12 N-351 Good modulus, tensible strength

and abrasion resistance with

lower heat buildup.

Tyre treads, retreading etc

13 N-375 Balance of fundamental

properties between N-220 and N-

339, its road ware properties are

similar to N-220.

Tyre treads, conveyer belt

mining rubber goods.

14 N-550 Excellent extrusion properties,

high green strength, medium

abrasion resistance.

Tyre innerliner,,butyl

tubes ,hoses, cables,

window channel seals,

mechanical goods

15 N-650 Easy mixing, goods extrusion

properties higher modulus.

Carcass stock, side wall,

tube molded items etc.

16 N-660 Cost effective, high loading in

rubber, easy mixing.

Inner tubes, molded items

etc.

17 N-762 Very high loading for better

economy, good processing, low

hysteresis to rubber.

Beads , insulation ,apex

molded goods etc.

18 N-774 Low compounding cost with

higher loading, higher structure

gives better processing.

Carcass stock, side wall,

tube molded items etc.

19 N-765 Easy Mixing higher modulus and Butyl inner tubes, high

37

law hysteresis. speed belting, carcass

stock etc.

3.4 Financial Performance of the Company

Parameters 2009 2010

Current ratio 1.45 1.56

Quick ratio 1.09 1.14

Inventory turnover ratio 10.14 10.76

Debtors turnover ratio 2.6 3.93

38

Working capital turnover ratio 4.18 6.05

Gross profit margin% 2.48 7.77

Return on long term funds 8.14 25.85

Fixed assets ratio 1.01 0.92

Solvency ratio 0.69 0.599

Propreitory ratio 0.11 0.19

Reported return on net worth -16.22 14.67

Dividend payout ratio(ne

tprofit)

- 25.11

Dividend payout ratio(cash

ratio)

- 13.46

Debt/equity 3.79 1.55

PCBL is a listed company in both the Indian bourses-BSE and NSE. The market

capitalization of PCBL as on 31-march-2010 is Rs 348 crores in which 50% comes from

the promoters and 11% from institutional holding. The revenue of PCBL during financial

year 2009-2010 was Rs, 1113 crores. The EBITDA was Rs 112 crores and the net profit

was Rs 24 crores. The dividend declaration as of last year was 20% of the profit. Annul

Tourneur crossed Rs 1200 crore during 2009-2010.sales value increased over 36%.sales

volume witnessed a robust growth of 11%. Power generation rose by 11.35% during

2009-2010. Production increased 11%.

The year 2009 visualized feedback price increased. In 2010 forward trading was done,

efficiency increased, challenges increased and the company focused on cost. Improved

operational efficiencies, better working capital management and lower finance cost

39

helped mitigate the steep increase in raw material cost during FY20011. Accounting to

management, the company saved Rs150cr in FY2010 on account of operational

efficiencies.

3.5 ORGANIZATION STRUCTURE

Fig. no.1

40

Managing Director

HeadProduction

Head finance

HeadPurchase&Storage

Head Logistic

HeadHead engg.

HeadHR

General Manager Cochin

4.1 ACCOUNTING AND FINANCE DEPARTEMENT

4.1.1 Structure of the department

41

WarehouseAsst. mgr.

Section

head

Officers

HeadWarehouse

HeadInstrumentation

HeadElectrical

Officers

HeadOil & exchange

Head Mechanics

Head Excise and oil

HeadR&D

FINANCE MANAGER

OFFICER ACCOUNTS ASSISTANT

EDP SR.OFFICER

Fig-2

4.1.2 Functions of Finance Department

To prepare Profit & Loss account and Profit & Loss Appropriation account

To prepare Cash Flow and Fund Flow Statements

To prepare quarterly financial reports

Supervise internal audit costing, budgeting and other internal control System

Establishing internal control in operational activities and financial transactions

To analyze and evaluate various trends such as net worth ratio, debt equity ratio

and current ratio

To estimate the value of fixed assets, current assets and liabilities

To prepare final accounts and this should be submitted to top management for

42

JR.ACCOUNTANT

approval

The objective of financial statement is ;

To estimate the earning capacity of the firm.

To determine the financial position and financial performance of the firm.

To determine the debt capacity of the firm.

To decide about the future aspects of the firm.

. Working capital management:- The management of working capital involves;

Cash balances.

Management of accounts receivable.

Management of inventory.

Credit managementBanking functions :-

PCBL banks with;

State Bank of India., State Bank of Travancore., ICICI Bank, Bank of Baroda.

4.1.3 Objectives of finance department

The financial management is generally concerned with procurement, allocation and

control of financial resources of a concern. The objectives can be-

To ensure regular and adequate supply of funds to the concern.

To ensure adequate returns to the shareholders which will depend upon the

earning capacity, market price of the share, expectations of the shareholders?

To ensure optimum funds utilization. Once the funds are procured, they should be

utilized in maximum possible way at least cost.

43

To ensure safety on investment, i.e, funds should be invested in safe ventures so

that adequate rate of return can be achieved.

Maximization of profit of the firm

Wage disbursement.

Budget preparation (weekly and annual).

To plan a sound capital structure there should be sound and fair composition of capital so

that a balance is maintained between debt and equity capital.

4.1.4 Financial summary, 2005-2010. (Rupees in lakhs)

44

4.1.5 Financial high lights of the company

45

Year ended 31.03.10 31.03.09

Revenue _ _

Carbon black 1178.05 1060.51

Power 54.52 15.51

Other income 2.81 14.44

Total revenue 1235.38 1090.46

PDBIT 190.67 50.58

Less; interest(net) 28.94 27.48

PDBT 163.73 77.66

Less; depreciation 31.15 19.64

PBT 130.58 97.30

Provision for taxation 7.89 32.46

PAT 122.69 64.84

Balance brought forward 39.49 104.33

Profit available for appropriation 162.18 39.49

Proposed dividends 11.30 _

Proposed golden jubilee

Year dividend

2.83 _

Tax on aforesaid dividends 2.34 _

Transfer to general reserve 12.30 _

Balanced carried forward to balance

sheet

133.41 39.49

2009-10 2008-09 2007-08 2006-07 2005-06

Sales 134437.91 120033.02 106802.87 106566.95 77341.42

Other income 281.14 1444.17 533.78 346.68 123.41

Expenses 121660.66 131207.24 96058.21 102458.99 79334.44

Profit before tax 13058.39 9730.05 11278.44 4454.64 1869.61

Taxation 788.90 3245.91 2347.59 2101.44 362.37

Profit after tax 12269.49 6484.14 8930.85 2353.20 1507.24

Dividend 1647.30 _ 1181.80 590.90 _

Retained profit 10622.19 6484.14 7749.05 1762.30 1507.24

Capital

employed

88946.72 64545.34 56851.23 45909.76 47960.23

Application of

funds

Fixed assets

68546.77 61074.51 37541.49 28138.09 28219.99

Investment 3777.96 3776.10 2805.52 2805.52 2906.53

Net current

assets

16621.99 377.64 16504.22 14966.15 16833.71

4.1.6 Responsibilities of key personnel

46

Responsibilities of Finance Manager

The responsibilities of the finance manager are as follows.

• Utilization and control of funds

• Planning the quantum and patter of fund requirement

• Procuring the required amount of funds and allocating the funds

• Verification of accounts

• Preparation of budget

• Financial planning

Responsibilities of Accountant

The responsibilities of the Accountant are as follows.

• Daily data entry

• Maintain the stock register

• Maintain the ledger, voucher etc.

Responsibilities of Cashier

• Maintain minimum level of cash flow to meet day to day expenses

• Record daily transaction of money

• Maintain cash book

4.2 PURCHASE AND STORES DEPARTEMENT

47

4.2.1 Structure of the department

Fig.no.3

Purchase Department is the key department in the company. Quality Raw materials leads

to quality products. The Purchase Department ensures the purchase of quality raw

materials for production at reasonable prices. About 90% of total cost is incurred for

48

Material manager

Dy. manager purchase

Dy. Manager Stories

Stores AssistantPurchase Assistant

Senior officerStore keeper

procuring raw materials. All other Departments act as supporting departments. This

department takes account of how much to be purchased and the stock level of production.

Purchase of various raw materials takes place through Purchase Department.

4.2.2 Functions of purchase department

The functions of Purchase Department include:

Approval of specification list of the materials required for a particular project

Receipt of materials > Identification and development of reliable

vendor for supply of equipment and materials

Material requirement planning

The performance evaluation of vendors

The vendor performance is evaluated based on:

Quality

Percentage of rejection

Adherence to delivery commitments

After sales service

4.2.3 Functions of stores department

49

As per the departmental procedure for purchase, all the materials required for the

project will come to the stores where the Store Head will be the custodian of all materials

being received. Incoming materials is inspected in accordance with the approved quality

plan for the project by officials.

Functions are:

Store Keeping

Inspection of incoming materials

Storage identification and preservation

Equipments records maintenance

Control of customer supplied materials

Stock verification

Safe custody of materials

Optimization of inventory

4.4.4 Procedure of purchase

The procurement action is initiated based on Purchase Requisition raised by the

intending department. The PR is originated by the head of the concerned department and

authorized by the chief of operation. The PR is received at them Purchase department

after the clearance by Stores Department. On receipt of PR in the purchase department

the purchase officer in charge of the registration of PR opens the purchase files for each

PR and assigns the file to the dealing officer based on the work allocation order issued by

the purchase manager. The purchase files are identified by the control number given by

stores department while clearing the PR, duly prefixed by the officer code number. The

dealing officer then initiates action for the issue of the enquiry.

50

Raw Materials

CBFS’ the primary raw material accounts for 55-60% of the total operating costs.

Hence, CB manufacturing is a highly raw material intensive industry. CBFS use the

residue left after the refining of the crude petroleum oil. Since CBSF prices are closely

linked with crude petroleum prices, the CB manufacturers are essentially price takers and

are exposed to the risk of volatility in CBFS prices. In order to insulate themselves from

such volatility, the domestic manufacturers have formulated a pricing policy which\ tries

to pass on the volatility of CBFS prices to the customers by linking with ex-factory CB

prices of a producer to its actual purchase cost of CBFS over a quarter.

Raw material cost being a ingredient of the total cost of the procurement of the same

is given the highest priority and is monitored at the level of managing director with the

help of a committee. PCBL produces around 70-80% of CBFS from the New York

Mercantile exchange (NYMEX) either through spot market or futures market. The rest is

being sourced from the domestic producers. The CBFS pricing at NYMEX becomes the

benchmark price for the domestic producers and hence the ultimate cost to PCBL is the

same, still PCBL prefers to impart the CBFS as a domestic feedstock has the lesser

quantity of carbon than the imported one.

4.2.5 Roles and responsibilities of store manager

Responsibilities of a store manager may include:

51

Human Resources, specifically: recruiting, hiring, training and development,

performance management, payroll, and schedule workplace scheduling

Store business operations, including managing profit and loss, facility

management, safety and security, loss prevention (also called shrink), and

banking

Product management, including ordering, receiving, price changes, handling

damaged products, and returns

Team Development, facilitating staff learning and development

Problem solving, handling unusual circumstances

4.2.6 Responsibilities of purchase manager

The main responsibility of a purchasing manager is to search for the highest quality

merchandise at the lowest possible purchase cost for their employers.

Purchasing managers evaluate suppliers based on cost, quality, service, availability,

reliability, and selection variety. They examine catalogs, commerce publications and

directories in order to find the right suppliers. Reputation is one of the main factors

purchasing managers use to determine whether or not they want to work with certain

companies. While at meetings, trade shows and conferences they inspect products and

services, evaluate production and distribution abilities and consider all other aspects that

may influence purchasing decisions.

Other duties a purchasing manager has are:

Establishing foreign and domestic suppliers

Negotiating the lowest prices

52

Administering online purchasing systems

Acquiring materials and parts needed

Structuring product contracts

Studying sales records and inventory levels

Placing orders and checking shipment

Controlling departmental budgets

Interviewing, hiring and overseeing staff

Appraising products and services

The purchasing managers frequently work more than 40-hours each week because of

sales and production deadlines. Usually purchasing managers should be available to

travel several days each month in order to attend conferences, trade shows and to meet

with suppliers.

Additional responsibilities of a purchasing management agent include analyzing

market conditions, assisting in the planning of sales promotions, aiding executives in

order to decide the nature of the sale and working with advertisers to create ad campaigns

for newspapers, television and direct mail. Purchasing managers commonly visit the

selling floor to make sure that all goods are displayed accurately.

4.3 PRODUCTION DEPARTEMENT

4.3.1 Structure of the Department

53

Fig.no.4

4.3.2 Functions of Production Department

The main functions of production manager are as follows

54

Production in charge

Shift in charge

Process Technician

Field Officer

DCS in charge

Production planning of various orders.

Arranging raw materials of different qualities.

Giving work orders and supply orders.

Arranging the production at different stages.

Arranging packing materials.

Review of all pending order to ensure on time shipment.

Taking corrective and preventive action needed to ensure on time

shipment.

The whole manufacturing process is controlled by a centralized system called DCS

system. The major equipments used for production process are as follows;

Reactors Air pre-heaters Process air blowers Compressors Pumps and fans Bag collectors Micro pulverizes Rotary drier

Storage silos and automated packaging machines.

4.3.3 Objectives of production department

Production involves the things which are essential for the manufacture of products.

The objective of the production management is ‘to produce carbon black right quality and

55

quantity at the right time and right manufacturing cost’.

1. Right quality

the quality of carbon black is established based upon the customers’ needs. The right

quality is not necessarily best quality. It is determined by the cost of the product and the

technical characteristics as suited to the specific requirements.

2. Right quantity

the organization should produce the products in right quantity. If they are produced in

excess of demand the capital will block up in the form of inventory and if the quantity is

produced in short of demand, leads to shortage of carbon black.

3. Right time

timeliness of delivery is one of the important parameter to judge the effectiveness of

production department. So, the production department has to make the optimal utilization

of input resources to achieve its objective.

4. Right manufacturing cost

manufacturing costs are established before the product is actually manufactured.

Hence, all attempts should be made to produce the carbon black at pre-established cost,

so as to reduce the variation between actual and the standard (pre-established) cost.

Elements of production operation

managing operations can be enclosed in a frame of general management function .

Operation managers are concerned with planning, organizing, and controlling the

activities which affect human behavior through models.

Planning

a\Activities that establishes a course of action and guide future decision-making is

56

planning. The operations manager defines the objectives for the operations subsystem of

the organization, and the policies, and procedures for achieving the objectives. This stage

includes clarifying the role and focus of operations in the organization’s overall strategy.

It also involves product planning, facility designing and using the conversion process.

Organizing

Activities that establishes a structure of tasks and authority. Operation managers

establish a structure of roles and the flow of information within the operations subsystem.

They determine the activities required to achieve the goals and assign authority and

responsibility for carrying them out.

Controlling

Activities that assure the actual performance in accordance with planned performance.

To ensure that the plans for the operations subsystems are accomplished, the operations

manager must exercise control by measuring actual outputs and comparing them to

planned operations management. Controlling costs, quality, and schedules are the

important functions here.

Behavior

Operation managers are concerned with how their efforts to plan, organize, and

control affect human behavior. They also want to know how the behavior of subordinates

can affect management’s planning, organizing, and controlling actions. Their interest lies

in decision-making behavior.

Models

As operation manager’s plan, organize, and control the conversion process, they

encounter many problems and must make many decisions. They can simplify their

difficulties using models like aggregate planning models for examining how best to use

existing capacity in short-tem.

57

4.3.4 Duties and Responsibilities of Production Manager

A production manager is involved in both the pre-production (planning) stage as well

as the production (control and supervision) stage. The production management involves

dealing with people, particularly those who work in your team. Production managers are

also involved with product design and purchasing. The PCBL planners, controllers,

production engineers and production supervisors will assist you.

In PCBL the production manager's role tends to be more closely integrated with other

functions, such as marketing, sales and finance. The main responsibilities of the

production manager are:

Overseeing the production process, drawing up a production schedule.

Ensuring that the production is cost effective.

Making sure that products are produced on time and are of good quality.

Working out the human and material resources needed.

Drafting a timescale for the job.

Estimating costs and setting the quality standards.

Monitoring the production processes and adjusting schedules as needed.

Being responsible for the selection and maintenance of equipment.

Monitoring product standards and implementing quality-control programmers.

Working with managers to implement the company's policies and goals.

Ensuring that health and safety guidelines are followed.

Supervising and motivating a team of workers.

Reviewing the performance of subordinates.

Identifying training needs.

58

Taking smart decisions for purchase of equipment and machinery for the production

unit. Attending meetings with senior board members and managers of PCBL discuss the

problems in production (if any) and inventing new technologies for better production.

4.3.5 Production process

Fig.no. 5

59Cracking reactor

Process air

PCBL manufactures Carbon Black by a process known as the “Oil Furnace Process”.

Carbon Black Feed Stock used as raw material are hydro carbon oils rich in carbon

content of petroleum and coal tar origin, preheated air and oil feedstock are injected in

reactor lined with high temperature refractory’s kept at a temperature of 1200-1600

degree celcious, where the feedstock undergoes cracking or decomposition.

60

Primary bag collection

The decomposition of the feedstock in deficiency of air and under carefully controlled

conditions results in the formation of Carbon Black aggregates. The reaction which takes

place in a few milliseconds is stopped by water quench. The resultant smoke carrying

Carbon Black is quenched with water sprays and passed through heat exchangers, which

in turn preheat the inlet oil and air thus achieving conservation of energy and improving

the yield.

The product stream i.e. smoke is further cooled by secondary water quenching in

vertical towers. it then enters bag filters where carbon black is separated from gas , the by

product called off gas having low calorific value (around 650-700kcal/NM3 average) is

burnt and the heat is utilized for generation of stream , drying operation &generation of

power. Separated carbon black dust is pneumatically conveyed to a pelletize where the

help of water solution and high gyrating force pellets are formed which are dried in rotary

dryers finally stored in product storage tanks , products are bagged in paper

bags(2.5kg.nt). PCBL manufactures carbon black in a number of grades. The various

grades can be broadly divide between two categories, viz, Hard Black & Soft black. Hard

Black is manufactured by a process called “tread stream” and is basically used for the

outer surface of the tyre. Soft Black is manufactured by a process called “carcass stream”

and is basically used for the inner surface of the tyre. The process flow schematic

diagram is enclosed.

Surface area and structure are two primary variables in the process, which result in

different grades, changes in surface area or structure or both at a time to pre-calculated

levels will effect change over into other grades. Surface area is changed by changing

operating conditions in the reactor, such as

Throughput(oil rate) oil burner positions

Residence time(time of reaction)

Oil-air ratio

61

Major equipments used

Reactors No: 3 & 6

Air pre-heaters

Process air blowers

Compressors

Pumps and fans

Bag collectors

Micro Pulverizes

Mixer Palletizes

Rotary Drier

Storage silos and auto packer

Four main stages of processing

Cracking

Filtering

Pelletisation

Drawing

Type of reactors used for the process

Tread

Carcass

Preservation of products

The department preserves the conformity of the product during internal processing,

storage and delivery to the intended destination. The preservation of the product includes

the protection of products against damage or loss during packaging, handling, storage and

delivery.

62

4.3.6 Product Identification

Colour code and batch number is used to identify packed products. Batch numbering

system followed for finished goods are as follows;

K XX YY ZZ A/B OOX; where;

K:- Kochi Plant

XX: - Year

YY: - Month

ZZ: - Date

A: - Material packed in paper bag machine

B: - Material packed in bulk bag machine

OOX: - Serial number for the batch of a particular day

4.4 HR AND ADMINISTRATION DEPARTMENT

4.4.1 Department structure

fig.no.6

63

HeadHuman Resource and Administration

4.4.2 Objectives of human resource management

The satisfaction of the society.

Identifying the need for training and performing training programs

Effective utilization of manpower and materials in productive work.

Satisfaction of personal objectives of members of the organization.

64

Canteen Senior officer

Junior officer Security

Sr. assistantSr. telephone

operator

Warehouse assistant driver cum attendant

4.4.3. Functions of HR department

1. Manpower planning

The requirement of human resources for the organization is based on the long term

business plan of the organization.

2. Training

Providing training to employees will result in high productivity, improving the quality

and help the company to fulfill its organizational goals. There are two types of training.

1. Behavioral training and

2. Technical training

The technical training comprises of on the job training and technology up gradation

training. Behavioral training comprises of soft skills development training.

In the beginning of the year a letter will be sent to the department head to identify skill

gap for behavior, technical training. After the identification of training needs human

resource department prepares a training calendar showing person, program, month, and

faculty. A questionnaire will be send to all department heads to know the change

imparted by training.

‘Competency profiling' is a method of CRG is used in PCBL which links compensation

to the 3 ps-person, position, performance. The model has helped the organization in

position clarification, objective setting, performance review, position evaluation and

personal development of executives.

Training shall be imparted in any of the following means in- house (on the job, of the

job ) external or third party training center. Training method to be adopted on case to

case basis depending on the need and profit of the personal required to be trained. In case

of transfers or new recruitment of personal, training is imparted by the head of the

65

respective department and sent to hed HR and administration. Candidates selected as

management trainees shll be imparted with the on the job training for the period of half

year based on requirements. Annual appraisal of all management staff shall be conducted

as per RPG group policies from time to time.

3. Recruitment and selection

The sources of recruitment of the company include both internal and external sources.

The company chooses external sources like campus recruitment personnel reference etc.

The company is in no way interested on conducting recruiters like privet employment

agencies for hiring purpose. Direct recruitment is made by the personnel manager and

concerned head of the department.

Selection procedure

Firstly the applicant has to fill a manpower requisition from. The shortlisted

candidates are invited to attend interview and the best candidate is selected among

them and given introduction training. The selected candidates are appointed on a

probation basis for six months after that they are eligible for all benefits from the

company. The promotion of the employees is based on merit. The performance

appraisal management system is highly active in the department. During the

beginning of the year duties and responsibilities each employees are prepared and

some standards are fixed in order to compare the actual performance with standard

performance.

4. Industrial relations

PCBL is having a smooth industrial relation set up. There are two unions representing

the unionized category of workmen, namely PCBL employees union and CACIL

employees association. There are four year long term settlements signed before the labour

commissioner towards ensuring wage hike, perquisites and productivity.

66

Unions and management strictly follows industrial disputes act 1947, which contains

provisions dealing with grievances redressed.

GRIEVANCE procedure

If any workman has any grievance to be redressed he must place the same before his

superior officer as soon as possible. If no satisfactory redressed is obtained from the

superior within 7 days the workman shall proceed with the formal grievance procedure.

Present a written statement of his grievance to the department head through

proper channel. The department head shall investigate the matter and give his

decision in writing to the workman within 10 days.

On failure to receive a satisfactory redressed from the department head the

workman may submit his grievance in writing to the G.M Tech/head of the

factory in respect of workman in the factory and an officer of the registered office

authorized by the management.

No grievance will be entertained by the GM (tech) officer authorized by the

management unless the formal grievance procedure has been followed as given

above except when it can be specifically shown that the department head is a

party to the grievance.

4.4.4 Responsibilities of HR manager

To maintain and develop HR policies, ensuring compliance and to contribute the

development of corporate HR policies.

Provide active support in the selection of Recruitment agencies which meet the

corporate standard.

67

Develop, refine and fine-tune effective methods or tools for selection / or provide

external consultants to ensure the right people with the desired level of

competence are brought into the organization or are promoted.

To develop the HR business plan.

Ensure appropriate communication at all staff in PCBL.

To facilitate / support the development of the Team members

To facilitate development of staff with special focus on Line Management

To recommend and ensure implementation of Strategic directions for people

development in PCBL.

Ensure a motivational climate in the organization, including adequate

opportunities for career growth and development.

Oversee the central HR Administration

Co-ordinate the design, implementation and administration of human resource

policies and activities to ensure the availability and effective utilization of human

resources for meeting the company's objectives.

Counseling and Guidance cell - provide support to Managers in case of

disciplinary issues.

Employee service and benefits;

Safety provision inside the workshop.

Employee counseling to solve the work problems and personal problems.

Medical treatment is provided to all the employees in the organization.

Canteen facilities.

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Yearly tour programmers are provided to both managerial staff as well as

the employees in the organization.

Performance appraisal

RPG Enterprise recognizes and honors performance through:

An aggressive performance management system

Awards for outstanding performance

Fast track careers for consistent high performers

Career opportunities in the various business sectors of the group

Organization and Management review process at the

management committee level that reviews the status and progress of

high fliers

4.5 MAINTANCE AND ENGINEERINGDEPARTMENT

4.5.1 Department Structure

Fig.no.7

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HOD

Manager mechanical

The maintenance department is concerned with rectifying problems related to 3 sections;

Mechanical section:- It rectifies mechanical defaults of machines and equipment’s

in the plant. The precaution initiative is taken by the head of the department for the

whole year. Once in every year, shutdown maintenance is performed for improving

the performance of the machineries in the plant.

Electrical sections:- It is engaged only for rectifying power failures.

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Manager instrumentation

Manager electrical

Asst. Manager Instrumentation

Helper

Draught man

Fitter

Management trainee

Engineer instrumentation

Forman

Electrician

Asst. Forman

Instrumentation section:- It deals with the maintenance of instruments showing

temperature of machines, flow of fuel, water etc.

4.5.2 Objectives of maintenance/engineering department

Maximization of plant availability.

Minimizing breakdown of all the 3 sections.

Implementation of scheduled preventive maintenance.

Implementation of planned condition monitoring.

4.5.3 PROCEEDURES FOLLOWED BY MAINTANANCE

DEPARTMENT

Preventive measures.

Corrective measures.

Material intend raising and inspection.

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Statutory inspection.

Equipment history.

Preventive measures are adopted in order to avoid future failures. Its aim is to bring down

the machine failures to zero. Engineers are provided with checklist. To check whether the

machines are running properly. Running maintenance is adopted when a machine fails.

Shut down maintenance is carried out for improving the performance of the organization.

4.6 WAREHOUSE DEPARTMENT

4.6.1 Structure of the department

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Head engineering

Fig.no.8

4.6.2 Functions of the department

Ensuring effective running of the department.

Planning as per planning schedules.

Responsible for packing, dispatch and inventory control of packing

materials.

Inspection and monitoring performance of packing machine and counter

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Section head warehouse

Heads man

Packing mazdoors

Helpers

Executive

weight checking.

Analysis of customer complaint on packing and taking necessary actions.

Inspection and approval of packing material and wooden pallets.

The department stores the product after packing until delivery. PCBL has a storage

capacity of 10,000 tones. After testing by the quality assurance department, the products

are stored in the storage which is having different compartments that are based on grades.

The packing process is done automatically through a machine which performs the

following functions like;

Bagging, Stitching, Weighing

There are 2 types of packing. They are:

Jumbo bags which is about 1 ton approximately.

Paper bags which is about 25 kg.

The main functions carried out are :-

Storing

Packing & Loading

4.7 LOGISTICS DEPARTMENT

4.7.1 Structure of the Department

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Head logistic

Fig.no.9

The policy of this department are:-

On time delivery of products to customers

Optimization of transportation cost for dispatches from plant

The responsibilities of Head logistics are:-

Scheduling dispatches from the unit

Selection of carriers and negotiating terms of business

Performance review of carriers

4.8 ENVIORNMENTAL DEPARTMENT

The department reduces pollution of air and water due to production process. The

company was awarded with ISO 14001 in 2004 for environment management systems.

PCBL promoted an ETP(Effluent Treatment Plant) which reduces water and oil through

an oil separator. Cochin unit was ranked 3rd among large industries in Kerala for its

effort in controlling pollution during 2004.

PCBL has also received awards like ICMA award for novel energy conservation in

chemical plants of the country and CHEMTECH foundation award for wealth from waste

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Senior assistant

in 1997.

PCBL has installed secondary bag filters in its Cochin unit. It is the only industry with

secondary bag filters. Whereas all other carbon black manufacturers rely on primary bag

filters. The bag filters are those that are used to prevent any release of carbon black into

the atmosphere.

4.8.1 Functions of the department

Setting and reviewing the environmental objectives.

Adopting the most appropriate manufacturing process.

Controlling pollution.

To be an environmental friendly organization.

4.9 RESEARCH AND DEVELOPMENT DEPARTEMENT

4.9.1 Structure of the department

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Manager R&D

Fig.no.10

4.9.2 Stages of quality control test

Quality control tests are conducted by way of in process test and finished goods

testing. In processing test are conducted during the process and is carried out with the

help of dust where as finished goods testing is carried out after production. Finished

goods testing are done by taking one sample from each tonne. The parameter for testing

is surface area and structure since the requirements for every customers are different.

Various quality test are carried out such as iodine absorption test, pellet hardiness test,

PH test etc.

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DY. Manager

SR.. Chemist

Chemist

Lab assistant

Fundamental research works are going on areas

Dual filter mechanism

Surface modification of carbon black

Development of non- ASTM black as per customer requirements

Development of LL black

4.10 MARKETING DEPARTMENT

Marketing functions of PCBL are centralized. PCBL Cochin unit has no separate

marketing department. Marketing functions are carried out through the head office of

PCBL, Kolkata. PCBL has 5 regional offices for coordinating the marketing process.

Each regional offices have:

1 regional marketing manager

1 accountant

Other supporting staff

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Production plan for Cochin unit is given from the head office and production is made

accordingly. The logistics department in the plant acts as the marketing department. They

make necessary arrangement for loading the products and coordinate other related

activities. 90% of the production is directly acquired by the tyre manufacturing

companies and remaining 10% by a soul distributor (A V Thomas & Co.).

4.11 CAPTIVE POWER PLANT DEPARTMENT

Generating Process Power

The main functions of department are :

Produce and supply electricity as per requirement

Produce and supply steam

The off-gas which comes out of the bag filter after being separated from carbon black

is basically a bi-product gas with a low calorific value. This waste gas is burned and heat

generated from combustion is used to generate steam in the boiler which in turn runs the

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turbine to generate power. The combustion furnaces a re built to incorporate the three

most critical requirements for burning low calorific value process waste gas namely:

Time for good mixing of combustible

Temperature for bringing combustibles to its ignition point

Turbulence to complete the combustion without going below the ignition point

The combustor is a refractory linked furnace and is kept hot to provide proper

temperature. Cyclonic principle is used to provide turbulence and intimate mixing of

process waste gas and combustion air adequate combustor volume is provided for the

necessary residence time to complete the oxidation of the combustible components. The

process waste gas enters the refractory linked combustor tangentially through a

rectangular part at high velocity. Tangential entry and high velocity imparts a strong swirl

to the process waste gas and the resulting centrifugal force makes the process waste gas

burn the hot refractory. The part of the combustion air is forced into swirling process

waste gas through multiple radial nozzles in the refractory. This high momentum jets help

the less viscous air to mix well with the more viscous process.

5.1 SWOT ANALYSIS

SWOT analysis is a basic, straightforward model that provides direction and serves as

a basis for the development of marketing plans. It accomplishes this by assessing an

organizations strengths (what an organization can do) and weaknesses (what an

organization cannot do) in addition to opportunities (potential favorable conditions for an

organization) and threats (potential unfavorable conditions for an organization). SWOT

analysis is an important step in planning and its value is often underestimated despite the

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simplicity in creation. The role of SWOT analysis is to take the information from the

environmental analysis and separate it into internal issues (strengths and weaknesses) and

external issues (opportunities and threats). SWOT analysis is done for a company, to find

out its overall Strengths, Weaknesses, Threats and opportunities leading to gauging the

competitive potential of the company. The SWOT Analysis enables a company to

recognize its market standing and adopt strategies accordingly. Here SWOT analysis of

Neon Paints is made to understand the positioning of the company better.

5.1.1 Strength

Reputation of the company.

40 years of experience.

Professional management.

Latest technologies

Sound financial position.

Better customer satisfaction.

ISO 9001:2000 certification.

ISO 14001:2004 certification.

ISO TS 16949 certification.

Less employee turnover ratio.

Wide market share in the domestic market.

5.1.2 Weakness

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Raw material of production has close relationship with crude oil prices.

The company faces risk when there are market fluctuations in foreign exchange

rate and due to strict regulations relating to the import of raw materials.

5.1.3 Opportunities

Growth in the domestic automobile industry.

The company can convert off gases to produce electricity and boost profitability.

The road infra structures can increase the demand for tyres which can lead to the

increase in demand of carbon black.

5.1.4 Threats

Increase in the cost of feedstock.

Volatile trade union.

Import of carbon black.

5.2 OBSERVATION AND SUGGESTIONS

Observation

There exist a well established organizational structure with the top level

management, the middle level management and the bottom level management.

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The organization has a well laid department structure with separate department

heads for each functional areas.

All departments in the Company are ISO 14001 certified. Regular internal and

external audits are conducted to check the compliance and renewal of certificate.

There is a full swing total quality management system and it works efficiently

ensuring the total quality of the organization and its product and services.

The company generates electricity for its operation on its own and the power

generated in excess of its requirement is sold to K.S.E.B

Materials management is so efficient that there are very less chances of damaged

goods and scrap items. The company takes necessary steps to see that damaged

goods are not coming in and going out.

PCBL Cochin unit has no separate marketing department. Marketing functions

are carried out through the head office of PCBL

All the employees and laborers are found to be working hard towards achieving

the organizational goal.

For solving grievance open door policy is used by top level management.

Suggestions

The plant may think of a separate marketing department so that the time lag for

decision making may be reduced.

The company must try to locally source the required raw materials to the

maximum extend

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The company should look at the option of generating more electricity as it can

contribute to reducing the problem of acute power shortage in the state.

The company may arrange for the transportation of its employees so that better

employee welfare can be ensured.

The company should initiate Public Relations activities to do away with its

negative image of a polluter.

The company has to focus on global market to increase its profitability

Latest production technologies may be implemented so as to reduce the

production cost.

The company must take the trade union into confidence so that tensions may be

reduced

6.1 CONCLUSION

Phillips Carbon Black Ltd., part of the RPG group pioneered the carbon black

industry in India. It is now the leading producer of carbon black in the country and the

7th largest carbon Black company in the world. Rapidly evolving trends constantly

revolutionize the manufacturing industry. To achieve competitive quality PCBL has been

continuously upgrading the technology.

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The study in Phillips Carbon Black Ltd has enabled the investigator to understand the

various needs of an organization, how an organization of a corporate nature functions and

how important it is to have a right relationship between the employee and employer or

the management.

The study was conducted with a view to understand the functions of an organization,

and its various departments. The organization study helped the researcher to understand

that any objective cannot be achieved in a short span of time.It needs to be undertaken

systematically.. Finally, in any organization time management play important role

because each activity should be done at a right time at right place

“This study has improved my confidence by its successful completion to undertake such

studies in the future.”

"Productivity is never an accident; it is always a result of commitment to excellence,

intelligent planning and focused effort".

BIBLIOGRAPHY

Books

a) Arun Kumar and Meenakshi, - “Marketing Management”, second edition, Vikas

publishing house Private Ltd New Delhi. (2006)

b) Kothari.C.R- “Research Methodology methods & techniques”, New age

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international publishers, 2004.

c) Aswathappa K- “Human Resource & Personnel Management”, Tata McGraw – Hill

publishing co. ltd., 1999.

d) Pandey.I.M – “Financial Management”, Vitas publishing house Private Ltd, 2000.

e) Annual report of PCBL Ltd.

f) Company brochure.

g) Website :- www.pcblltd.com

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