report final

PART I

CHAPTER 1INTRODUCTION

1. 1 INTRODUCTIONInfrastructure is the tiny world which encompasses the profit and pride of a nation. Infrastructure includes energy, transportation and communication. Infrastructure facilitates are also called as social overhead and belong to the core sector of the economy. Adequate quantity, quality and reliability of infrastructure are the key factor of an economy. Power is needed to turn the wheels of machine. Vehicles are necessary and essential to transport goods and services. Communication links are vital to talk to suppliers, customers and creditors. Economy growth of any country depends on these factors. Due to the effective infrastructure India has gained competitive strategies that have placed firmly in the midst of the most advance nation in the world. Electricity is also a part of Indians lifetime achievement. The availability of electricity is very much needed in our nation now days. Electricity in Kerala is sold out to others states the availability of electrical energy and its per capita consumption is regarded as an index of national standard of living. Electricity has become synonymous with progress of lack of inadequate measure which can throttle the entire economic activity and well being of the country. An organization is a social unit of people, systematically structured and managed to meet a need or to pursue collective goals on a continuing basis. I consider myself fortunate enough to get an opportunity to undergo my study with Transformers And Electricals Kerala Ltd. This progressive and forward looking organization constantly strives for improvement in its systems and procedures so as to improve the organizational effectiveness.1.2 NEED OF THE STUDYThe study was to have a general awareness of the functioning of the various departments and management of TELK. The study helps to analyze each department and to attain information regarding the strengths, weakness, opportunities and threats of various departments.1.3 OBJECTIVES OF THE STUDY To know about the organization functioning of the company. To know the functions of the various departments. To understand organization structure of the company and chain of command. To analyze the SWOT of company. To know the strategies of the company.1.4 METHODOLOGYResearch in common parlance refers to a search for knowledge. One can also define research as a scientific and systematic search for pertinent information on a specific topic. In fact, research is an art of scientific investigation. The Advanced Learners Dictionary of Current English lays down the meaning of research as a careful investigation or inquiry specially through search for new facts in any branch of knowledge.1 Redman and Mory define research as a systematized effort to gain new knowledge.Research is an academic activity and as such the term should be used in a technical sense. According to Clifford Woody research comprises defining and redefining problems, formulating hypothesis or suggested solutions; collecting, organizing and evaluating data; making deductions and reaching conclusions; and at last carefully testing the conclusions to determine whether they fit the formulating hypothesis.Method of data collection: Primary data: It can be collected either through experiment or through survey. If the researcher conducts an experiment, he observes some quantitative measurements, or the data, with the help of which he examines the truth contained in his hypothesis. The data were collected through direct interview with officials of TELK and through keen observation. Secondary data: It means data that are already available i.e., they refer to the data which have already been collected and analyzed by someone else. Thus the data were collected from departmental manuals, enquiry, past records and from companys website.1.5 LIMITATIONS OF THE STUDY The time frame was limited ie there was lack of time for the study Lack of sufficient data.

CHAPTER 2INDUSTRIAL PROFILE

2.1. INDIAN POWER SECTORIndias power generation of installed capacity at the end of XI Five-Year Plan (March 31, 2012) stood at approximately 200 GW. Of the total, approximately 78 GW of power generation capacity addition was planned during the XI Five-Year Plan period, which was subsequently revised to 62 GW, of which only 55 GW of capacity was added. Acute fuel shortage (both coal and natural gas), high coal prices and delay in commissioning of new units, affected capacity addition plans. Although India has the fifth largest power generation capacity, globally (trailing behind China, US, Japan and Russia), a power deficit scenario has been plaguing the sector for more than a decade. Indias per capita power consumption of around 700 kilowatt hour (kwh) per annum is significantly below the world average of 2,600 kwh and developed countries average of 8,000 kwh. India needs to rapidly increase its generation capacity to achieve 1,000 kwh per capita consumption annually, in order to achieve the goal set by the Ministry of PowerPower for All. Power deficit at the end of XI Plan reached 8.5 per cent, whereas peak deficit was to the tune of 10.5 per cent. Key reasons (apart from missing out on power generation capacity addition targets) for the continued power deficit scenario in the country are: Dismal conditions and inappropriate maintenance of existing T&D equipment/infrastructure Rampant power theft, leading to high T&D losses (at the end of XI Plan, T&D losses were to the tune of 23.3 per cent) impacting financial condition of power T&D utilities (discoms and transcos) A robust and efficient power T&D infrastructure is imperative for effective transfer of power from generation source to the consumption points / demand centers. Thus, expanding the T&D infrastructure to transmit the power generated to consumer points across the length and breadth of the country becomes imperative. Transformers are critical components of the power T&D network that are used to change voltage in the power transmission and distribution process, and hence play a key role. Transformers can be broadly classified, based on the output rating as: Distribution transformers (31.5 KVA to 5,000 KVA). Power transformers (5.1 MVA to 500 MVA). Special transformers (depending on the type of application like welding, traction, furnace, etc.). Power is a critical infrastructure on which the socio-economic development of the country depends. Recognizing that the electricity is one of the key drivers for rapid economic growth and poverty alleviation, the Indian government decided to bring all new power generation, transmission and distribution in rural and urban centers, under the purview of state and central government agencies. Accordingly state electricity boards were formed in all states. The central government was giving priority to this sector, while fixing plan outlays. Commencing with the fifth plan (1974-1979) the government increased its direct role in the generation and bulk transmission of power to supplement the efforts of the states. 2.2. TRANSFORMER INDUSTRIES IN INDIA The Indian transformer industry is more than five decades old, hence mature. Domestic manufacturers have developed capabilities to manufacture all types of equipment to meet the countrys demand for transformers up to 800kV and going up to 1,200kV. The industry enjoys a good reputation in terms of quality, price, and delivery in the domestic as well as overseas markets. Indias transformer market is predominantly unorganized with many small participants catering to the smaller distribution transformer markets. However, many are slowly graduating to the medium-sized category, thus expanding the organized participants base. There are 300+ transformer companies in India, with an overall annual installed capacity of over 370,000 MVA. The market is fragmented with around 20 organized players such as Bharat Heavy Electricals Ltd (BHEL), ABB Ltd, Crompton Greaves Ltd (CGL), Areva T&D, EMCO Ltd, Bharat Bijlee Ltd (BBL), Vijai Electricals, Transformers & Rectifiers India Ltd (TRIL), Voltamp Transformer sLtd, and others. In the power transformers category, companies in the high-end segment (400kV and above) mainly include international players such as ABB Ltd, Alstom T&D (erstwhile Areva T&D India), and Siemens; and Indian manufacturers such as BHEL, CGL, TRIL, and Vijai Electricals. Majority of other companies in this sector are present in the 220kV segment in power and distribution transformers. Leading players have significant presence in both power and distribution transformermarket.

Fig.2.1: Transformer Large players such as BHEL, ABB Ltd, Alstom T&D (erstwhile Areva T&D India), and CGL have installed capacities exceeding 15,000 MVA per annum. However, these are diversified power equipment players and the transformer segment is not a major revenue contributor. Among players who primarily manufacture transformers, TRIL is the largest in capacity followed by EMCO, Vijai Electricals, Voltamp Transformers, and Bharat Bijlee. The unorganized sector primarily caters to smaller rating transformer requirements. Apart from catering to domestic demand, India exports transformers to over 100 nations including the US, Europe, Malaysia, Singapore, Bangladesh, African countries, and Gulf countries. India is also an importer of transformers; the major source countries include China, Germany, USA, Korea, and Japan. 2.3. TRANSFORMER MARKET2.3.1. TRANSFORMER MARKET SIZE IN INDIA The transformer market in India can be pegged at more than Rs.13,000 crore. Power transformers contribute 45 per cent of the total market and distribution transformers 55 per cent. Over the last two years the market has grown at a very moderate rate at less than 4 per cent, due to the slowdown of power generation capacity addition and T&D infrastructure expansion. Anticipating the huge domestic (due to a power deficit scenario, requirement of power sector expansion) and overseas demand, the transformer industry in India has more than doubled its manufacturing capacity over the last five years. Transformer manufacturing capacity in India stands at ~370 GVA with capacity utilization rates hovering around 60-70 per cent on an average over the last five years. Transformer over-capacity in the Indian market has led to immense pricing pressure scenario severely impacting the profit ability of the market players. New entrants Indias huge power shortage, need to ramp up power T&D infrastructure, economic slowdown of developed markets like Europe and North America and excess Transformer manufacturing capacity in China has resulted in India being an attractive destination for transformer companies globally to tap the Indian market opportunity. Anticipating this, many foreign players are already in the process of setting up base in India. Over the last 12-15 months, new players have entered the market either through acquisitions or through setting up of facilities within India. A few notable examples are: Canadian company, Hammond Power Solutions Inc. had acquired 70 per cent equity stake in the Hyderabad based transformer supplier Pan- Electro Technic Enterprises Pvt. Ltd in February 2012. Chinese manufacturer, TBEA has set up transformer manufacturing unit in Gujarat in order to qualify for the bids from PGCIL. Another Chinese player, Baoding Tianwei Baodian Electric Co. (TWBB) has set up a joint venture (JV) with Anand-based Atlanta Electricals Private Limited for setting up a transformer factory in India. South Korea's Hyundai Heavy Industries is also planning a facility for manufacturing transformers in Sanand, Gujarat. 2.3.2. MARKET DRIVERS Power generation capacity augmentation and Power T&D infrastructure expansion to be in-line with power generation capacity addition. According to the XII Plan, Rs.12,00,000-13,00,000 crore is likely to be invested in the power sector. This spending on the power sector is expected to be equally distributed between generation and T&D. Spending on power T&D infrastructure is expected to boost demand for transformers. Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) scheme to improve rural electricity infrastructure and rural household electrification. The electrification drive is expected to provide impetus to demand for distribution transformers. Increasing focus on Rural Electrification Accelerated Power Development and Reform Program (APDRP 1-2) in order to minimize aggregate technical and commercial (AT&C) losses at the distribution level and improve the financial health of the state electricity boards. Industrial sector Growth. Replacement of ageing equipment. These reforms are expected to significantly affect demand for transformers over the next four to five years. 2.3.3. MARKET CHALLENGES CRGO: Inadequate supply of prime quality Cold Rolled Grain Oriented (CRGO) steel is the biggest challenge faced by transformer manufacturers in the country. CRGO requirement is completely met through imports; it is in fact challenging to assess the true quality of the material that is used by the transformer manufacturers in India. India needs 2.5 lakh tonnes of CRGO every year and an appalling 70 per cent of this is scrap grade material. Failure rate of Transformers: High failure rate of distribution transformers is a big concern for the transformer industry in India. The average operational life of a transformer is between 25 to 30 years; however, transformers in India are known to be recalled for repair in as early as three years. The failure rate of distribution transformers in India is estimated at 10-15 per cent (in stark contrast to the less than 2 per cent in developing countries). This is due to the low entry barriers in the distribution transformer market leading to unorganized players entering the market, and competing on the price factor. SEBs historically follow a L1 vendor selection criteria, which has led to proliferation of many small players, that compromise on the quality of transformers manufactured. Financial condition of state utilities: State power utilities have been facing losses due to the supply of subsidized power to agricultural farmers, theft of power, and inefficient T&D infrastructure. This has restricted private investment in the power T&D sector, thereby reducing the quality of service from SEBs. This, in turn, is affecting the capacity building program and transmission of power. Lack of testing facilities: The growth in testing infrastructure has not kept pace with that of production, both, quantitatively and qualitatively. Testing infrastructure available at India's premier agency, the Central Power Research Institute (CPRI) is proving short of demand. Manufacturers of large power transformers at times need to send their equipment for testing to overseas facilities like Korea Electro technology Research Institute (KERI) and KEMA which is expensive. Apart from this, huge logistical costs and lead time are also involved. 2.4. THE WAY FORWARD The Indian power and distribution transformer markets are highly dependent on investments planned by the Government of India for the T&D segment and reform programs like the Revised Accelerated Power Development and Reform Program and Rajiv Gandhi Grameen Vidyutikaran Yojana. These programs, when fully implemented as scheduled, are expected to drive the demand for both power and distribution transformers. The Government of India currently plans to strengthen transmission lines and create a National Grid interconnecting the five regions (northern, southern, eastern, western and northeastern) through the creation of Transmission Super Highways; this is expected to drive the demand for higher-rated power transformers. With T&D companies actively striving to reduce aggregate technical and commercial (AT&C) losses, the demand for energy efficient transformers would get a boost. The financial bailout package for SEBs announced by the Cabinet Committee on Economic Affairs (CCEA) in September 2012 is expected to improve the commercial viability of distribution utilities. This restructuring scheme expected to improve the liquidity position of the discoms, since 50 per cent of short term liabilities would be taken over by state governments. The restructuring of the balance 50 per cent of liabilities is to be accompanied by concrete and measurable action (performance linked) by the discoms/states to improve operational performance of discoms. Power tariff increase is one of the metrics, which the utilities have to undertake as part of their structuring package. The improvement in SEBs financial condition would enable them to undertake power T&D infrastructure expansion in line with the requirement resulting in driving transformers demand. With huge investments proposed across sectors such as power, infrastructure, etc., the transformers market in India is slated for strong growth. The excess capacity in the Transformer industry in India, and entry of new players is further expected to increase market competitiveness. Market consolidation over the next few years is inevitable. Electric equipment industry contributes over 2% of GDP which is projected to increase to about 12% in 2015 according to a study by Frost & Sullivan. During the period, consumption of electrical equipment is estimated to increase from over USD 28 bn now to USD 363 bn, growing at a CAGR of about 30%. It is also expected that during 2010-2015, the Indian equipment manufacturing will grow at 5.5 times the growth rate of global electronic equipment production. The electrical equipment and accessories industry, with its highly diversified content, may be broadly segmented into (i) generation equipment, (ii) transmission equipment, and (iii) distribution equipment. The equipments and accessories under these segments include motors, turbines, gene-rators, switchgears, transformers, circuit breakers, induction motors, power capacitors, meters, transmission towers. Besides these, the spectrum covers a whole range of power cables including XLPE and AAC and ACSR conductors and electrical consumer products like fans, electric lamps, exhausts and domestic appliances and accessories. Inverters, gensets, UPS also fall under its domain. The electrical industry has been showing signs of recovery after poor performance in the recent years. The domestic electrical industry, which includes equipment for generation, transmission, distribution and use of power in industrial units, constitutes a major part of the electrical products. The growth of the industry is directly related to the development of power generation and distribution. India's generation capacity of 2,300 MW in 1950 expanded to over 116,500 MW including non-utilities at the end 2000-01. The total installed capacity of electric power generation further increased to 141,080 MW in 2007-08 (upto January 2008) compared to a capacity of 128,000 MW during the same period in 2006-07. The Eleventh Plan has targeted a capacity addition of 78,570 MW. The five years (2007-2012) may be the best of times for power equipment makers with the power sector on a expansion spree. With order-book growth expanding over the last three years, there is a good chance that this will continue. Close to 82% of the planned generation capacity for the Tenth Plan was either implemented or was in the process of being implemented. Even assuming a 70% implementation ratio for the Eleventh Plan, close to 55,000 MW will be added. Five ultra mega power projects, totaling 20,000 MW are coming up in 2008. In the transmission sector, for example, Power Grid Corporation is planning a capex of Rs 710 billion by 2010.Earlier, the shortfalls in achieving the Plan targets of addition to power generation and up-gradation of transmission and distribution had adversely affected the electrical equipment industry. The peak shortage which was over 11% of the requirement in 2003-04 increased to 11.7% in 2004-05 and to over 12% in 2005-06. The shortage further rose to about 14% in 2006-07. In the ten months of 2007-08 the peak shortage had risen to over 15% of the peak demand of 107,010 MW. According to the Power Ministry, the power sector has tied up Rs 2,240 billion worth of investments to build power plants with 70,000 MW capacities in the next three years. India's capacity to manufacture power equipment is set to increase four-fold to around 43,000 MW over the next 5 years, through investments of over Rs 300 bn. The additional capacity of 33,000 MW is expected to be added by 2015. Companies like L&T, JSW, and Reliance are in process of setting up equipment manufacturing capacities. Apart from the addition of indigenous capacity, this will also lead to up gradation of technology in the equipment sector. There is also a significant presence of the small scale and medium-sized companies in the electrical equipment industry, the share of which is estimated at around 35%. According to the Power Ministry, the power sector has tied up Rs 2,240 billion worth of investments to build power plants with 70,000 MW capacities in the next three years. The Indian government has set ambitious goals in the 11th plan for power sector owing to which the power sector is poised for significant expansion. In order to provide availability of over 1000 units of per capita electricity by year 2012, it has been estimated that need-based capacity addition of more than 100,000 MW would be required. This has resulted in massive addition plans being proposed in the sub-sectors of Generation Transmission and Distribution. Investment is also expected to flow into different segments of the value chain, covering the segments of power generation, transmission and distribution and allied sectors such as equipment, technology and services. The private sector is expected to play a more active role in investment and capital productivity. The government has undertaken a number of initiatives to facilitate private sector participation. With some fast moves at launching fast track projects to augment supplies, the Indian industry needs to improve its competitiveness. The Indian market is growing and multinationals with newer technologies are now more active.Power Transformer

Power Transformers are used in Transmission network so they do not directly connect to the consumers. These are not loaded fully at all time so iron losses takes place 24hr a day and cu losses takes place based on load cycle. Average loads are about only 75% of full load and these are designed in such a way that max efficiency occurs at 75% of full load. These are independent of time so in calculating the efficiency only power basis is enough. Power transformers are used for transmission as a step up devices so that the I to R loss can be minimized for a given power flow. These transformers are designed to utilize the core to maximum and will operate very much near to the knee point of B-H curve (slightly above the knee point value). This brings down the mass of the core enormously. Naturally these transformers have the matched iron losses and copper losses at peak load (i.e. the maximum efficiency point where both the losses match). Bulk AC power transmission necessitates the use of high voltages. Progressively, the transmission voltages have risen to 400 kV AC in India. In India, system voltages up to 400 kV are well established and 800 kV AC transmission systems are being planned. This will require manufacturing of 800 kV transformers. Most of the major transformer manufacturers in India had collaborations with reputed international companies, such as Associated Electrical Industries (AEI,) U.K.; Alsthom, France; Hawker Siddely, U.K.; Hitachi, Japan and Siemens, Germany. Market Survey Electric equipment industry contributes over 2% of GDP which is projected to increase to about 12% in 2015 according to a study by Frost & Sullivan. During the period, consumption of electrical equipment is estimated to increase from over USD 28 bn now to USD 363 bn, growing at a CAGR of about 30%. It is also expected that during 2010-2015, the Indian equipment manufacturing will grow at 5.5 times the growth rate of global electronic equipment production. The electrical industry has been showing signs of recovery after poor performance in the recent years. The domestic electrical industry, which includes equipment for generation, transmission, distribution and use of power in industrial units, constitutes a major part of the electrical products. India's capacity to manufacture power equipment is set to increase four-fold to around 43,000 MW over the next 5 years, through investments of over Rs 300 bn. The additional capacity of 33,000 MW is expected to be added by 2015. With some fast moves at launching fast track projects to augment supplies, the Indian industry needs to improve its competitiveness. The Indian market is growing and multinationals with newer technologies are now more active. The industry, as a consequence, needs strategic alliances and tie-ups with technology suppliers to upgrade their supplies. The technology for the manufacture of transformers, for instance, is largely European. As a result, most players have the same level of technology. Even prices do not differ substantially. Lately, encouraging sign are emerging. The entry of private sector in the power area and the emergence of captive power plants have changed the scenario for the transformer segment. Earlier, the business revolved around power utilities such as the State Electricity Boards. As against this, the customers in the private sector prefer contracting out the entire substation to a single vendor, in the process thus reducing costs as well as avoiding problems of logistics. As more and more MNCs and specialized industries make India their business destination, special economic zones have been allocated and feeding mega projects of robust and efficient transformers, ensuring the optional generation of power. Transformers & Rectifiers India Ltd (TRIL) is a leading player in this industry. Recently TRIL signed a billion rupee MoU with the Government of Gujarat to set up a new plant at Moraiya with an installed capacity of 16,000 MVA. It will make TRIL the third largest transformer manufacturing company of India. Siemens is now setting up a state-of-the-art Greenfield world class facility for manufacturing industrial turbines at Vadodara, Gujarat. Siemens will be manufacturing industrial steam turbines of up to 45 MW capacities, completely with its components at the Vadodara unit. It will also manufacture key components for steam turbines of up to 150 MW capacities. The company is investing Rs 30 mn in its new facility. It has grown to a complex of 14 manufacturing units during its 50 years in India. Of the world's total installed capacity in power generation, 20% is based on the Siemens technology. In India, Siemens accounts for about 35% of the generation capacity. Even BHEL manufactures Siemens larger turbines under license agreement in India. It also upgraded the traction converter unit at Nasik and a 245 KV circuit breaker unit at Aurangabad. Wartsila India in talks with the Rural Electrification Corporation (REC) for setting up power generation plants. It plans to run the plants on bio-fuels such as Jatropha and palm oil. It will set up small generation plants of 2 to 3 MW at an investment of around Rs 100 mn to Rs 120 mn respectively. The company claims that the engines supplied by it can use raw bio-fuel without the need for etherification process (a chemical reaction in which two chemicals form an ester as the reaction product by which the oil pressed from Jatropha can be used to produce bio-fuel). Four major players in electrical equipment segment recorded high growth of turnover over the previous accounting years: ABB (44%), BHEL (29%), BHEL Power Solutions (144%), Havels India (55%), and Kirloskar Electric (43%) Crompton Greaves (32%) and Suzlon Energy (42%). The growth of bottom lines was equally impressive ranging from 12 to 55%. Few Major Players are as under:- Advance Powerinfra Tech Ltd. Ahluwalia Contracts (India) Ltd. Alfa Transformers Ltd. Alstom T & D Distribution Transformers Ltd. Alstom T & D India Ltd. Apex Electricals Ltd. Automatic Electric Ltd. Bharat Bijlee Ltd. Bombardier Transportation India Ltd. Crompton Greaves Ltd. D & H India Ltd. Diamond Power Transformers Ltd. E C E Industries Ltd. East India Udyog Ltd. Electra (India) Ltd. Electra (Jaipur) Ltd. Emco Ltd. General Electric Co. Of India Ltd. Genus Power Infrastructures Ltd. I M P Powers Ltd. Indian Transformers Co. Pvt. Ltd. Indo Tech Transformers Ltd. Kanjikode Apparel Exports Ltd. Kanohar Electricals Ltd. Karnataka Vidyuth Karkhane Ltd. Kirloskar Brothers Ltd. Kirloskar Electric Co. Ltd. Kryfs Power Components Ltd. M & B Switchgears Ltd. Marsons Ltd. Mukati Transformers Ltd. N G E F Ltd. Powergear Ltd. R T S Power Corp. Ltd. Rams Transformers Ltd. Raychem-R P G Pvt. Ltd. Rohini Industrial Electricals Ltd. S E Electricals Ltd. Schneider Electric Infrastructure Ltd. Shilchar Technologies Ltd. Star Delta Transformers Ltd. Star Transformers Pvt. Ltd. Statcon Power Controls Ltd. Sudhir Transformers Ltd. Suzlon Infrastructure Services Ltd. Toyama Electric Ltd. Transformers & Rectifiers (India) Ltd. Tyche Electronics Ltd. Usha (India) Ltd. V H E L Industries Ltd. Victory Electricals Ltd. Vijai Electricals Ltd. Voltamp Transformers Ltd.

Plant capacity: 900 Nos. /annumPlant & machinery: Rs. 305 Lakhs

Working capital: -T.C.I: Cost of Project: Rs. 1024 Lakhs

Return: 29.00%Breakeven: 52.00%

Distribution Transformer

PRODUCT PROFILE: The transformers are a device that transfers electricity or energy from one electric circuit to another without change of frequency and usually, but not always, with a change in voltage. In India the role of transformers assumes an added significance since in most of the states; electric supplies are not only erratic but are also characterized by wide variations in frequencies or voltages. These causes enormous damage to the electrical appliance like refrigerators, television and other industrial machinery engaged in the production of commodities. The transformer industry with the help of innovative methods, up gradation in technology etc., will have to manufacture transformers which offer maximum functional efficiency and are at the same time less hazardous or dangerous and economically viable. Over the past hundred years Transformers have played a major role in the growth of almost all industries in the world. The foundation for the ideal of a "Transformer" was laid by Michael Faraday in the year 1931. Due to continuous efforts of physicists and engineers in the past year, Transformers, underwent many changes, to keep pace with the rapid growth of electrical industries. Now there exists a variety of transformers each differing from the other in its operation, construction, size and applications. Applications In India the role of transformers assumes an added significance since in most of the states; electric supplies are not only erratic but are also characterized by wide variations in frequencies or voltages. These causes enormous damage to the electrical appliance like refrigerators, television and other industrial machinery engaged in the production of commodities. The transformer industry with the help of innovative methods, up gradation in technology etc., will have to manufacture transformers which offer maximum functional efficiency and are at the same time less hazardous or dangerous and economically viable. Global demand Indias Power and Distribution Transformers Market to Grow Exponentially by 2012 Realizing the importance of private participation in the power sector, India is strengthening its policies to encourage private investments. The countrys Electricity Act of 2003 caused the compulsory unbundling of the state electricity boards to improve their operational efficiencies, thus creating new market demand for better transmission equipment. As a result the Indian power and distribution transformers market is growing rapidly, according to a recent study by Frost & Sullivan, a global growth consulting company. The Frost & Sullivan studies found that revenues in this industry totaled US$1.04 billion in 2005 and are likely to reach $5.31 billion in 2012. Governments emphasis on the transmission and distribution sector reforms and investments are showing signs of fruition, thus creating a phenomenal growth opportunity for the Indian transformer market. Due to rapid economic development and governments target of power for all by 2012, the Indian power sector will need to replicate what has been achieved during the last 50 years in the next 10 years. During the period, consumption of electrical equipment is estimated to increase from over USD 28 billion now to USD 363 billion, growing at a CAGR of about 30%. The demand of Transformers in the market is immense and therefore its market position is splendid. Hence it is an excellent field to venture.

Plant capacity: 900 No.s/Annum DT(100KVA), 600No.s/Annum DT(100KVA) Plant & machinery: 245 Lakhs

Working capital: -T.C.I: Cost of project: 527 Lakhs

2.5. TRANSFORMER OIL

Transformer oil, or insulating oil, is usually a highly-refined mineral oil that is stable at high temperatures and has excellent electrical insulating properties. It is used in oil-filled transformers, some types of high voltage capacitors, fluorescent lamp ballasts, and some types of high voltage switches and circuit breakers. Its functions are to insulate, suppress corona and arcing, and to serve as a coolant. These are mineral oils and are used to dissipate the heat generated in electric transformers, switches, circuit breakers and motor starters etc. They also act as electrical insulators. As transformers consume maximum amount of such oils, most these are also called Transformer oil. This oil can also be used as electrical cable oil. The main consuming industries for transformer oil are the electrical industries for transformers. In transformers it is used as an insulating fluid as wells as cooling media. The lubricating oil and grease market in India is of the order of 1.3 mn tonnes and is growing at around 4.5% annually. The moderate growth is paradoxically due to the supply of better quality of lubricants which have longer servicing capability. The lubricant market is estimated to grow to the level of 1.42 mn tonnes in 2006-07 and to approximately 2.00 mn tonnes in 2014-15. The Indian lubricants industry claims to be the sixth largest in the world. It has the presence of almost all major MNCs which include Shell, Mobil, Gulf Oil, and Caltex. Some of these oil majors have even tied up or renewed old ties with public sector undertakings, thereby gaining the advantage of distribution and infrastructural networks. The industry is being constrained by high petroleum prices. Until the 1980s, lubricants produced in the country were basically simple blends based on low and medium level technologies. More sophisticated lubricants were imported and these accounted for a relatively small market. Product variation is fairly extensive depending on the requirements of the segment served. In many cases, specific customers have their own special requirements. The lubricants market was dominated by three public sector refinery companies: (i) Bharat Petroleum (ii) Indian Oil Corporation, and (iii) Hindustan Petroleum. Small contributions came in from BPL and private players like Castrol. Lubrizol India and Indian Additives came into existence for manufacturing sophisticated lubricant additives with the collaboration of Lubrizol and Chevron, respectively. The demand of transformer oil is increasing year by year due to increase in demand of transformers. There is good scope to venture in to this project for new entrepreneurs. Few Indian Major Players are as under: Apar Industries Ltd. Apar Ltd. [Merged] Electra (Jaipur) Ltd. M P Petrochem Ltd. Madras Petrochem Ltd. Powerlink Oil Refinery Ltd. R T S Power Corpn. Ltd. Raj Lubricants (Madras) Ltd. Rams Transformers Ltd. Savita Oil Technologies Ltd. Vijai Electricals Ltd.

Plant capacity: 30000.00 KLS/annumPlant & machinery: 1294 Lakhs

Working capital: -T.C.I: 3675 Lakhs

Transformer Industry, a segment of Heavy Electrical Industry depends solely on the power development in the country in particular and of the world in general. That is, demand for Transformers and related products are a derived demand dependent on Power Sector Development. The power generating capacity in India increased almost 50 times during the past fifty years. The transformer Industry mainly comprises the Power Transformers Segment and the Industrial Transformer Segment. The industry is monopolistic in nature with the bulk of the demand for Power Transformer being generated by State Electricity Boards and Central Government undertakings, Independent Power producers and Turnkey Projects. Power is a basic input for growth and development of a country and it is essential ingredient for improving the standard of living of the people. As such, in developing economies, the importance of growth of power sector cannot be over emphasized. India, with its planned economy, was giving ample importance to the power sector in the five-year plans. Transformer industry is divided into distribution, power and other types of transformers. The demand for transformers comprises of new demand as well as replacement demand. About 95% of transformers used in the Indian power network are of indigenous make. New demand is dependent on the new power generation capacities added. Currently, India has an installed capacity of approximately 115,000 mw. As per the planning estimates, the installed capacity should be increased to 200,000 mw by 2012, majority of which is to be installed within next 3 years. The replacement demand depends on the life of the transformer and the existing capacity in the economy. At the end of the sixth five-year plan (1980-1985) a total of 337,584 MVA of transformer capacity was added. Since these transformers' life exceeds 20 years, they are due for replacement. Also, Indian players in the engineering segment, foraying into turnkey projects overseas, are further adding to the demand for transformers. The demand is expected to experience double digit growth over the next few years. Large players such as BHEL, ABB, Areva T&D, Crompton Greaves, and Siemens have capacity of more than 15,000 MVA p.a. However, they are diversified power equipment players and the transformer segment is not a major revenue contributor. Among players who primarily manufacture transformers, TRIL is the largest by capacity followed by EMCO, Vijai Electrics, Voltamp, and Bharat Bijlee. Most players have significantly expanded capacity to tap demand. Over the past four years, capacity utilization has improved to 80%, on the back of strong demand and as expansion projects were under construction for majority of the companies.Demand for Power Sector: Indias power demand is likely to cross 300GW, in the next 10 years earlier than the most estimates. Meeting this demand will require a fivefold to tenfold increase in the pace of capacity addition. The profile of planned capacity will also need to be suitably modified to fulfil peak demand, keep emissions under check, reduce dependence on imported fuels and provide affordable power. The Indian power transformers market has grown by leaps and bounds for over five decades and has a well-matured technology base up to the 800 kV class. As there is a demand upswing for reliable power in the country, the transformers market is witnessing a growth trend. With huge demand for power evacuation from large generating stations and strengthening of the inter-regional transmission grid, the transmission and distribution (T&D) utilities are the major end users of power transformers in India. The Indian economy is witnessing a restoration and so is the electrical industry and its various segments including the transformer industry. High demand arising from the energy intensive oil and gas, and cement segments has buoyed prospects for the Indian power transformer market. Developments in the power sector will have huge ramifications for the Indian transformer industry. The transformer industry which had more than doubled its capacity over the last five years anticipating huge domestic and overseas demand is today suffering from overcapacity, notes the analyst of this research service. However, a shift in the governments focus to strengthen the power T&D system has unleashed abundant opportunities for the power and distribution transformer market. The Government of India is encouraging investments at the T&D level to increase access to reliable power supply and reduce technical and commercial losses in the system through schemes such as Revised Accelerated Power Development and Reform Program (R-APDRP) and Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY). The R-APDRP scheme aims to bring down the Aggregate Technical and Commercial (AT&C) losses in the T&D network. This entails huge investments in the T&D sector including use of energy efficient transformers, besides renovation, modernization, restructuring, and up gradation of the T&D infrastructure. Evidence points to a conscious effort to upgrade the grid voltages to 765 kV to minimize the transmission losses and the corridor width. Major participants are gearing up their manufacturing facilities to this changing paradigm with MNCs bringing technology from their parent companies, while local participants are obtaining the technology through acquisition and technology transfer. The Bureau of Energy Efficiency (BEE), Ministry of Power, is actively working to ensure that quality products are procured by the electricity boards and has accordingly stipulated mandatory star rating for distribution transformers. Distribution transformer procurement for R-APDRP is likely to be set at a minimum of 3 star rating. A large number of distribution transformer manufacturers have already applied to BEE for acquiring star ratings.Several transformer companies in the small and unorganized sector are slowly graduating to the medium-sized category, thus expanding the base of organized participants. India is on the verge of becoming an emerging power nation among developing economies. The availability of electricity is directly linked to the Gross Domestic Product (GDP) growth of developing economies, India being no exception. Growth of the Indian electrical industry and its investment appeal primarily depends on government policies. Timely capacity additions to electricity generation, transmission and distribution are necessary to improve and sustain GDP growth and reduce the electricity demand-supply gap. According to the Power Ministry, the power sector has tied up Rs 2,240 billion worth of investments to build power plants with 70,000 MW capacities in the next three years. The Indian government has set ambitious goals in the 11th plan for power sector owing to which the power sector is poised for significant expansion. In order to provide availability of over 1000 units of per capita electricity by year 2012, it has been estimated that need-based capacity addition of more than 100,000 MW would be required. This has resulted in massive addition plans being proposed in the sub-sectors of Generation Transmission and Distribution. Investment is also expected to flow into different segments of the value chain, covering the segments of power generation, transmission and distribution and allied sectors such as equipment, technology and services. The private sector is expected to play a more active role in investment and capital productivity. The government has undertaken a number of initiatives to facilitate private sector participation. With some fast moves at launching fast track projects to augment supplies, the Indian industry needs to improve its competitiveness. The Indian market is growing and multinationals with newer technologies are now more active.

Table.2.1: Existing Transmission Lines And Expansion During 2012-2017The typical manufacturing process of an LPT consists of the following steps:1. Engineering and design: LPT design is complex, balancing the costs of raw materials (copper, steel, and cooling oil), electrical losses, manufacturing labor hours, plant capability constraints, and shipping constraints. 2. Core building: Core is the most critical component of an LPT which requires highly-skilled work force and cold-rolled grain-oriented (CRGO) laminated electrical steel. 3. Windings production and assembly of core and windings: Windings are predominantly copper and have an insulating material. 4. Drying operations: Excess moisture must be removed from the core and windings, because moisture can degrade the dielectric strength of the insulation. 5. Tank production: A tank must be completed before the winding and core assembly finish the drying phase so that the core and windings do not start to reabsorb moisture. 6. Final assembly of the LPT: The final assembly must be done in a clean environment; even a tiny amount of dust or moisture can deteriorate the performance of an LPT. 7. Testing: Testing is performed to ensure the accuracy of voltage ratios, verify power ratings, and determine electrical impedances. In the manufacturing process, certain parts can be produced either at the transformer plant or at another vendor or subsidiary location, depending on how vertically integrated the particular plant is, whether the plant has the necessary tools and capabilities, as well as economic reasons.

CHAPTER 3ORGANISATIONAL PROFILE

3.1. COMPANY PROFILETELK, Transformers and Electricals Kerala Limited was incorporated in 1963 under an agreement with Government of Kerala, Kerala state Industrial Development Corporation and M/s. Hitachi Limited, Japan to set up a full-fledged unit for designing and manufacturing Extra High Voltage Electrical equipments in India. TELK set an example by venturing into the area of manufacturing high capacity transformers in India at a time when nation relied mostly on imported equipments to meet its power transmission requirements. Located at Angamaly, near Cochin in Kerala, the first product rolled out from TELK in 1966. TELK has established its own brand image for quality and reliability. Since 23rd June 2009, Telk is a Joint Venture Company of Government of Kerala and NTPC Ltd. TELK transformers are designed to suit the exacting requirements of customers and to meet the relevant international standards. Experts at TELKs R&D department are engaged in product engineering and research activities. Owing to which TELKs product line is constantly evolving. In India, TELK had bagged several prestigious contracts for power transformers against International competitive bidding, facing severe competition from international giants. A sweeping glance at TELKs prestigious clientele will provide a clear view of the corporate achievements. It includes National Thermal Power Corporation, Nuclear Power Corporation, Power Grid Corporation, Bhakra Beas Management Board, Tata Electric Company etc. along with all the State Electricity Boards and many major industrial firms in India. Besides being the choice of the nations discerning customers of exacting requirements, TELK Transformers has also won over clients from countries such as Tanzania, Nepal, Oman, Indonesia, Nigeria and Malaysia. TELK has been exporting its products right from the 1970s. However, a real boost to TELKs Export Marketing efforts came with the recent opening up of the Indian Economy and the subsequent globalization measure of the Indian Government. The first major export of TELK consisted of two 50MVA transformers to Tanzania in 1972. TELK has bagged and executed many sizable exports contracts to customers like PLN of Indonesia, TNB of Malaysia, MEW of Oman, NEPA of Nigeria etc. some of the export contracts are still under execution. TELK had been following a very stringent quality standard laid down by their collaborators M/s Hitachi, Japan and this has enabled TELK to penetrate new overseas markets against stiff competition from Multinational Giants. The fruitful collaboration with Hitachi helped TELK to bring out the latest innovations in power transmission technology. This has enabled the company to become a prominent one in the manufacturer of power transformers and allied products. TELK has earned a reputation for outstanding technical expertise; excellent quality and dedicated service back up. Catering to the deserving requirements of international standards, TELK has gained many first to its credit. Since the companys quality system fully comply with the requirements of ISO 9001 Certification during September 1995. This is the first Kerala Government undertaking getting ISO certification. The machinery and equipment of TELK are up to the international standards. Imported vertical winding machine, totally air conditioned winding assembly shops that ensure precision humidity controlled and dust free atmosphere etc. are some of the features that lend structural base for TELK quality. TELK has a professional and efficient marketing set up and they have a very efficient Project Engineering Division. Between 1966 and 1980 the company worked profitably and afterwards it began to show loss trend mainly due to the substantial dip in the companys products leading to severe in working capital. As a result the company was declared a sick unit by the Board of Industrial and Financial Reconstruction (BIFR). On the basis of the recommendations made by BIFR various relief and concessions were granted by various banks, institutions and the Government of Kerala. As per the rehabilitation packages the company is taking all efforts to reduce the losses to the minimum by achieving operational efficiency and cutting down costs in all areas. Now the company has become a profit making unit. A Business collaboration and shareholders agreement was entered into between the Government of Kerala, M/s. NTPC Ltd. and the company on 23-06-2007. This is a landmark in the history of TELK. By joining hands with NTPC, a Navaratna company, TELK will be able to attain the path of high growth and will be able to beat competition in the industry in the highly changing industrial scenario.TELK in the Power Transformer field in India as follows: First 40 KV Power Transformer manufacturers in India. First 315 MVA capacities, 400 KV Transformer manufactured in India. Largest capacity Generator Transformer manufactured In India (630 MVA). First 400 KV Gas Circuit Breaker manufactured in India. The largest capacity Isolated Phase Bus duct (IPB) in the Indian grid was supplied for the first 500 MW units at Trombay. First PSU in India having successfully short circuit tested 400 KV, 315 MVA transformers with basic emulation level point. First 400 KV Condenser Bushing manufacturers in India etc.3.1.1. Stages of Expansion In TELK TELK has made its growth through value addition and expansion projects done within the company. The most important 4 stages of project expansions done in TELK are as follows:- In the first stage, initial capacity was 1080 MVA Power Transformer. Current Transformers (CT), Potential Transformers (PT), Voltage Transformers (VT), On Load Tap Charger (OLTC), Bushing etc. are produced. In 1974, the public issue of equity share capital of Rs.2crores increased to Rs.5crores. At that time the capacity increased to 3000 MVA. The capacity was increased to 4500 MVA. The fourth stage expansions are the turning point of TELK.3.1.2. Achievements & Awards 1963- Year of Incorporation. 1963- Technical and financial collaboration with M/s. Hitachi Ltd, Japan. 1966- Installed first power transformer (4MVA, 66/11 KV) to KSEB. 1972- Entered into international business; exported first power transformer to Tanzania. 1975- Installed first 400kv class Power Transformer and CTs. 1976- Listed on Bombay stock exchange. 1982-Iinstalled 600kv (3 x Single phase) for Indias first 500MW, 220KV Thermal Power Station at Trombay for TATA. 1995- Accredited with ISO 9001-1994 certification. 1998- Sub Divided190 MVA 3 phase transformer foe APSEB. 1999- Accredited ISO 2008 certificate. 2003- Installed largest capacity transformer in India. 630MVA Transformers (3x Single Phase bank) Indias first 400KV, 500 MW Nuclear Power Station at Tarapur. 2009- NTPC Ltd acquired 44.6% stake in TELK from Govt. of Kerala for business collaboration. 2009-TELK won the awards instituted by Government of Kerala. Outstanding Achievement in Enterprise performance for the year 2008-09, among the state owned enterprises under the department of industries and commerce. Outstanding achievement in corporate leadership award for the best PSU CEO in 2008-2009. 2009-Accredited with ISO 9001:2008 Certification. 2010-TELK has become the first power equipment manufacturer in India who have conducted the short circuit test on 315 MVA(400/220/33KV) transformer having 1425 basic kvp insulation level at KEMA Netherlands. 2010-TELK won award instituted by Government of Kerala for outstandingachievement in corporate Leadership award for the best PSU CEO in 2010-2011. 2011-TELK AcquiredNABL accreditation (ISO/IEC 17025:2005) for its Electrical Test Laboratory. 2011-TELK obtained Export House status from Govt of India. 2012-TELK won Kerala safety award for very large factories in engineering category. 2013-TELK became Kerala safety award runner up.3.2. LEGAL FRAME WORK OF THE ORGANIZATIONTELK Transformers and Electricals Kerala Limited was incorporated in 1963 under an agreement with Government of Kerala, Kerala state Industrial Development Corporation and M/s. Hitachi Limited, Japan to set up a full- fledged unit of designing and manufacturing Extra High Voltage Electrical equipments in India. Now TELK is a joint venture between Government of Kerala and NTPC Ltd.

3.3. CAPITAL OF THE COMPANYCapital of TELK made up of shareholders Fund & loan funds. Share holders funds include equity share capital and resource and surplus whereas loan Funds consist of Secure Loans. Also it contains sales tax dues amounting to 219.54 lakhs which has been differed by the Government of Kerala up to 2002 without interest.Authorized Capital : Rs.10, 000.00 croresSubscribed, issued & paid up : Rs.8, 245, 46 croresSales : Rs.210 croresNet profit for the last year : Rs.23 crores3.4. MANAGEMENT SET UP OF TELKThe management of the Company subject to the control & supervision of directors. Managing Director is the Chief Executive of the Company. As per the business collaboration and shareholders agreement and upon transfer of 44.6% of paid up share capital by Govt. of Kerala to NTPC Ltd, the company was reconstituted with the new board of directors in 2009 with 4 nominees of Govt. of Kerala and 4 nominees of NTPC Ltd. Presently The board of Directors are under the chairmanship of Shri. V. Somasundharam IAS and Shri. Arun Kumar Gupta is the Managing Director.

CATEGORY

PERCENTAGE OF SHARES

NO. OF SHARES

Govt. of Kerala

23444102

NTPC ltd

19163438

Others

359810

42967350

Table.3.1: Present Capital Structure of TELK

Fig.3.1: Percentage of Shares3.4.1. VisionBest among Indias Power equipments manufacturer with an increased share in global market.3.4.2. MissionAchieve market leadership and generate surplus to ensure growth by providing quality products and services that delight customer.3.4.3. Quality PolicyTELK is committed to provide products and services that meet customer and regulatory requirements and to continually strive for business excellence.3.4.4. Quality ObjectiveContinual improvement of business excellence through- Reducing business cycle time. Achieving lowest manufacturing cost. Technology up gradation. Reducing rework level. Increased customer satisfaction.All products coming out of TELK are subject to stringent quality check to ensure relevant international quality standards and have been bestowed with ISO 9001. The company presently is aiming at attaining total quality management. TELK has got the position in India as the manufacturer of Best Quality Equipment in Extra Voltage field. This unique position in respect of Quality was imbibed in TELKs culture right from the beginning, with cent per cent Japanese technology and manufacturing methods that we adopted from the world famous Hitachi, Japan. The Company has got ISO 9001-2008 Accreditation.3.4.5. ServiceCustomer service forms the basis of TELKs strong success. TELK enjoys the patronage of a large number of valued customers. 3.4.6. ValueGood value for money is the basis for pricing of TELKs products and many of the customers are aware of the premium price, which TELK is eligible. TELK has successfully served a number of prestigious projects at fairly differentiated from the reputed companies such as M/s NTPC, TATA etc.3.4.7. Safety policy of TELKTELK believe that Safety and Health of its employees and safe working environment are fundamentals to the companys operation.Objectives: Manufacturing of Heavy Electric Equipment such as transformers, turbines and other allied electrical machinery. To Manufactures, import, export deal in wholesale or retail radiographs, photographs, Dictaphones, television sets and sorts of electrical and wireless seta instruments and articles. To construct, maintain and alter any building, works manufacturing roads, railways, docks and other convince, necessary for the business of the company. To undertake and execute any trusts the undertaking where of any seen desirable, either gratuitously or otherwise. To acquire and undertake the whole or any part of the business properly and liabilities of any person or company carrying on any business which he company is authorized to carry on or possessed to properly suitable for the purpose of the company. To take part in the management, supervision or control of the business or operation of any company or undertaking and for that purpose to appoint and remunerate any Directors, Accountants or other Exports or officers. To invest and deal with the moneys of the company not immediately required in such manner, as many from time to time be determined. Reducing business cycle time and achieving lowest manufacturing cost. Technology up gradation and reducing rework level. 3.4.8. ObjectivesManufacturing of Heavy Electric Equipment such as transformers, turbines and other allied electrical machinery.To Manufactures, import, export deal in wholesale or retail radiographs, photographs, Dictaphones, television sets and sorts of electrical and wireless seta instruments and articles. To construct, maintain and alter any building, works manufacturing roads, railways, docks and other convince, necessary for the business of the company. To undertake and execute any trusts the undertaking where of any seen desirable, either gratuitously or otherwise. To acquire and undertake the whole or any part of the business properly and liabilities of any person or company carrying on any business which he company is authorized to carry on or possessed to properly suitable for the purpose of the company. To take part in the management, supervision or control of the business or operation of any company or undertaking and for that purpose to appoint and remunerate any Directors, Accountants or other Exports or officers. To invest and deal with the moneys of the company not immediately required in such manner, as many from time to time be determined. Reducing business cycle time and achieving lowest manufacturing cost. Technology up gradation and reducing rework level. 3.5. PRODUCT PROFILE1. Power transformers: Power transformers are vital equipment needed for high voltage power transmission. The design and manufacturing processes followed by TELK are based on the latest techniques developed by our collaborators Hitachi Ltd, Japan, who have over sixty years experience in this field. 2. Current transformers TELKs current transformers are sturdy and extremely reliable which is proven with their more than 30 years in the field. They are required for protection and metering in generating stations, receiving stations and power transmission networks. We are adopting Hitachis designs and latest manufacturing techniques. These porcelain type current transformers are hermetically sealed and are fitted with surge diverters which protect CTs from surges.3. Potential transformers. They are also required for protection and metering in transmission networks. The voltage transformers are designed and manufactured based on the techniques followed by Hitachi Ltd. These voltage transformers are hermetically sealed and provided with adequate shields to protect them against over voltages.4. Bushing TELK manufactures bushings as per Indian andinternational standards. These are not susceptible to ageing and have excellent thermal stability and low dielectric losses even at high temperatures and over voltage which make them superior to other types of bushings. TELKs bushings are more compact, sturdy, and non-susceptible to impurities and humidity. These bushings are hermetically sealed.5. On -load tap changerHigh-speed resistor transition type on-load tap changers consisting of diverter switch, tap selector, driving mechanism and control panels. The use of this built-in-type changer makes the trnsformer more compact.3.6. CUSTOMERS OF TELKMajor customers in India:-All large Electrical Power utilities in India are customers of TELK (both public and private sector utilities). Some important customers are- Nuclear Power Corporation. National Thermal Power Corporation. Power grid Corporation of India Ltd. TATA Electric Company. Indian Railways. Kerala State Electricity Board. National Hydro Electric Power Corporation. Other major private utilities. International Customers of TELK- Ministry of electricity and water, Oman. Nepal electricity authority. Tanzania electric company. Perushan Umum Listric Nigra Pusat, Indonesia. Tanaga National Berhad, Malaysia. Central electricity board. Mauritius. Hitachi power systems, Indonesia. Hitachi, Singapore. National Electric Power Authority (NEPA), Nigeria. ABB, Finland.TELK-ISO 9001 CompanyTELK Is an ISO 9001 accredited Company and it has got its benefits such as: Clear and transparent system which everybody can follow. Improved efficiency & effectiveness of the organization. Better understanding about the customer requirements & perceptions. Effective internal communication. Improved awareness about quality within the organization.3.7. COMPETITORS3.7.1. National Competitors1. Bharat Heavy Electrical Ltd. (BHEL). It wins ICAI National awards for excellence in cost management for the 7th consecutive year registered Office BHEL House, Siri Fort New Delni-110049 India.2. Crompton and Greaves Ltd (CGL). CGL is a pioneering leader in the management and application of electrical energy with a presence in 10 countries. CG is achieved in the global power transmission and distribution.3. General Electrical Ltd Company (GEC). This is an American multinational conglomerate corporation incorporated in Schenectady, Newyork and head quarted in Fairfield, Connecticut, United States.4. Bharat Bijili, Andrew Yule Company, Eswar and son, Kirloskar, New Govt Electrical Company. It is one of the leaders in the electrical engineering industry in India.3.7.2. International Competitors1. Asian Brown Boveri (ABB).It is a leader in power and automation technologies that enables utility and industry customers to improve their performance ABB ltd, registered office PIOL No 22 a Shah Industrial Estate, 1st Floor Finland.2. SIEMENS (Germany).German multinational conglomerate Company head quarter in Munich Germany. It is the largest Europe based electronics and electrical engineering company.3. AROWAY (Canada).Aroway OR the company is an oil Focused Canadian based exploration, acquisition and production company with operations on the profile peace River Arch Region of North Alberts Canada.4. AE Power System (Japan). This is one of the International Company. Japan AE Power System was discovered into its separate parent company. 3.8. ORGANISATIONAL STRUCTURE Anorganizational structureconsists of activities such as task allocation, coordination and supervision, which are directed towards the achievement of organizational aims. It can also be considered as the viewing glass or perspective through which individuals see their organization and its environment. Organizationsare a variant ofclustered entities. An organization can be structured in many different ways, depending on their objectives. The structure of an organization will determine the modes in which it operates and performs. Organizational structure allows the expressed allocation of responsibilities for different functions and processes to different entities such as thebranch,department,workgroup andindividual. Organizational structure affects organizational action in two big ways. First, it provides the foundation on which standard operating procedures and routines rest. Second, it determines which individuals get to participate in which decision-making processes, and thus to what extent their views shape the organizations actions. Communication is an essential part for the success of any organization. In TELK two ways of communication exist. One is formal and other is informal. Company provides extension phones and parallel connections to every department. Written order in the form of circular, memos etc. are used for communication. Common matters of the company are displayed in the notice board.

Fig.3.2: Organizational Structure3.9. ROLE AND RESPONSIBILITIES OF EXECUTIVESAuthority and Responsibility, their interrelation is defined and communicated within the organization. The organization structure of the company is given below. Board of Directors manages the company and one among them will be the Chairman. At present there are 7 Directors out of which 3 are nominated by the Government of Kerala and 4 by the NTPC. The management of the company is subject to control and supervision of the director board and the routine affairs are handled by Managing Director. He is the chief executive of the company. The board is primarily a policy making body. It is on the basis of the policies enunciated by the board that day to day administration of the company is carried out. (a) Chief Executive Officer (CEO) Responsible for the following functions:-1. Overall responsibility, authority & control of companys various activities including, product quality and ensuring sustained growth & business excellence.2. Responsible for providing resources required for the operations of the company.(b) General Manager (GM) Responsible for the following functions:-1. Overall control of Marketing, & Customer servicing activities.2. Overall control of planning, Industrial Engineering. 3. Overall control over Design & Development and R & D.4. Overall control of Production & dispatch of products.5. Overall control of installation, maintenance of plant, Equipment & Utilities including in house construction work.6. Overall control over customer supplied products.(c) Joint General Manager finance and accounting (JGM(F&A) Responsible for the following functions:-1. Overall control of the financial operations of the company and preparation and maintenance various books of accounts of the company in line with the companys rules and relevant Acts.(d) Deputy General manager (DGM (C&M)) Responsible for the following functions:-1. Contract review.2. Vendor evaluation & approval.3. Purchasing.4. Stores management.(e) Company Secretary and Deputy General Manager (Human Resources and New business Development) (CS and DGM (HR/NBD) Responsible for the following functions:-1. Secretarial functions.2. Corporate affairs.3. Company estate & guest house.4. Procurement of furniture & inventory control of TELK office building. 5. Record room, dispatch etc.6. Recruitment of Human Resources.7. Selection of Human Resources.8. Training and development of the different Human Resources.9. Welfare activities for the staff.(f) Manager safety (MGRSF) Responsible for the following functions:-1. Coordinate all safety related activities. 2. Coordinate all legal complaints.(g) Head of Marketing (AGM) Responsible for the following functions:-1. Market study and environmental scanning.2. Tender review and order/contract review.3. Liaison with customers.4. Order execution, installation, commissioning and arrange for the after sales service.5. Redress of customer complaints.6. Control over customer supplied products and collection of receivables/payments.7. Control of documents and coordination within the department / with other depts. and different selling Agents.8. Collection of C Forms and TDS certificates and arrange for its submission to the concerned departments.(h) Head of Customer Service Division (AGM (SD) Responsible for the following functions:-1. Tender review and order review.2. Liaison with customers.3. Order execution, installation, commissioning and servicing of products.4. Collection of receivables/Payments.5. Control of Customer supplied products. 6. Control of documents and coordination within the department / with other departments etc.(i)Head of EDP (DGM IT) Responsible for the following functions:- 1. Control of electronic data processing.2. Application system development / procurement & implementation.3. Computer installation / maintenance / upkeep of computer system.4. Back up of data / programs in the centralized server and periodic integrity checkup of back up.5. Security against unauthorized access of systems. 6. Control of documents & related records etc.(j) Head of Switchgear Design (SMRD) Responsible for the following functions:-1. Control of design assignment.2. Tender & design assignment.3. Approval of design outputs, review / verification /validation of design & control of design changes. 4. Training of design staff, preventive action review and co-ordination within the department / with other depts. etc.(k) Head of Quality Assurance (AGM (QA & I) Responsible for the following functions:-1. Verification/Inspection/Testing of products.2. Stage/final inspection of products. 3. Calibration (electrical), servicing and maintenance of QA equipments.4. Control over further processing, delivery or installation of Non conformity product until the deficiency or unsatisfactory condition has been corrected.5. Release of final products.6. Corrective action review. 7. Control over documents, co-ordination within the department/with other departments etc.(l) Head of Transformer Production (AGMP)) Responsible for the following functions:-1. All activities related to product realization of the division.2. Maintenance of plant, equipment, utilities and safety activities related to production.3. In house construction work. 4. Liaison/Co-ordination with marketing and other departments etc.(m) Head of Tender Design (AGM D) Responsible for the following functions:-1. Control of design & development.2. Tender & Design assignment.3. Approval of design outputs, review/verification/validation of design & control 4. Training of design staff, preventive action review, co-ordination within the department / with other departments etc.(n) Head of Planning (AGM N)Responsible for the following functions:- 1. Chalk out Companys production plans & schedules as per the strategy.2. Materials requirement planning for transformers.3. Liaison/Co-ordination with marketing, design & production centers. 4. Control of documents / records and MIS etc.(o) Head of Store Responsible for the following functions:- 1. Receipt, Identification, Storage, Issue & Control of materials.2. Disposal of scrap / obsolete materials.3. Control of documents & related records. 4. Overall planning of store activities & Co-ordination / liaison with other depts. /scrap dealers etc.(p) Head of R & D and standards (AGME) Responsible for the following functions:- 1. R & D activities planning.2. Assignment of R & D projects, review & Surveillance of R&D activities. 3. Issue & control of design outputs as generated in the section.4. Preparation/Collection & Control of company standards / drafting manuals and national, international & HKS standards.5. Codification of materials. 6. Drawings & other documents control etc.(q) Head of Factory service (AGM FS) Responsible for the following functions:- 1. Coordinates all maintenance activities of the equipment. 2. Coordinate all utility services.3.10. DEPARTMENT ANALYSISIn large organization, it is usually easier to identify separate functional areas because people work together in departments. Each department carries out the tasks that relate to its particular area. The main purpose of functional areas is to ensure that all important business activities are carried out efficiently. This is essential if the business is to achieve its aims and objectives. In addition, specific areas will be responsible for supporting specific type of aims and objectives, for example: sales and marketing will be involved in achieving targets linked to developing new markets or increasing sales human resources will be involved in arranging staff training activities and supporting the continuous professional development of all staff.The main functional departments of TELK are, Production department. Human resources department. Purchase and materials department. Production planning and control department. Project engineering department. Marketing department. Quality assurance and testing department. Finance department.3.10.1. Production Department

CEOThe production department is headed by assistant general manager (technical). Under the production wing, these are the various dealing with Design and planning (material and production), production, assembly, inspection and testing, Factory service dispatch of transformers etc. each department is headed by managers who are responsible to general managers.

AGMP1 AGMP

AMP1 AMP2 MGRP1 SMRP2 SMRP1

Chart No:1The various shops under this department are: CT/PT/BUSHING. OLTC. MACHINE SHOP. PLATE WORKSHOP. CORE SHOP. COIL INSULATION. FINAL ASSEMBLY. OIL AND DRYING.3.10.2. Human Resources DepartmentThe success of any organization lies in its human resources. TELK has an effective and efficient, fully fledged Human Resources department. The company has separate orders for both workmen and office men. The selection processes of the employees are taking place through the public service commission and the work men are selected through employment exchange. After selecting the employees the Human Resources department gives proper training for the job.

CS& DGM (HR/NBD)

AO (HR) AO (HR)

Chart No:23.10.2.1. Human Resources planning:The Human Resources requirement of each department, to achieve the target is determined first. Manpower requirements of production and administration departments are planned in such a way to meet the future expansion and development of the company. The department prepares manpower planning schedule every year. In TELK, future demand is usually accessed based on the number of people likely to be retired. This year however some additions are also made along with usual replacement. This is mainly because the management has raised the expected annual output to 6000 MVA, when the installed capacity is only 4500 MVA (assuming only 50% employee efficiency)annually.3.10.2.2. Functions of Human Resources Department:1. Actual promotion of both workmen and officers.2. Referendum.3. Recruitment procedure of Contract employees.4. Labor Welfare.5. Prepare Officers Rating Report.6. Issue of Salary to Employees.7. Retirement Arrangements.8. Advertisements.9. Transfer and Posting.10. Recruitment of apprentices.11. First Aid Treatment.12. Disciplinary Action. 3.10.2.3. The Areas Covered Under This Department:1. Recruitment and Selection.2. Induction, training and Development.3. Promotion.4. Wages and Salary administration.5. Time office.6. Performance Appraisal.7. Welfare Measures.8. Employee grievance.9. Industrial relation.10. Public Relations.3.10.3. Purchase And Materials DepartmentPurchase of material is one of the most important functions of material management. At times material account for more than 50% of production costs. Ignoring this function can be very expensive. Purchase may differ from firm to firm. In an Industry purchase means buying of equipment, materials, tools, parts, stores etc. required for industry. In manufacturing the first step is to purchase raw materials is required. Careful buying reduces the cost of materials & thereby increasing profits. Hence purchasing is one of the delicate activities. The head of purchase departments of TELK controls all purchase for the company production and also responsible for the evaluation of vendors & for the development of new and existing vendors.ROLE: To ensure timely delivery of raw materials and components conforming to the required specifications and at the optimum cost.OBJECTIVE: Annual reduction in procurement cost by 3% depending on market condition Reduction in rejection percentage of incoming materials Reduce internal lead times of materials, receiving, documentation & storage. Proper protection/validation/re-valid of materials Identification and maintenance of stores to enhance customer satisfaction Receive and identify scrap materials and disposing off at the earliest as per the direction of management. THE MAIN RAW MATERIALS AND ITS SUPPLIERSCopper conductors Bhandari Power Lines Private Ltd., Karnataka. KSH International Maharashtra. Asta India Private ltd, Gujarat. Delta Trans conductors, Maharashtra.Craft Paper Weidman- Sweden.Crape Paper Amotfors Sweden. Muntso- Sweden.Press Board Weidman- Sweden.Tetron Ribbon Nisselon Japan.Tetron String Nisselon Japan.CRGO KRYFS- Power components Ltd Mumbai. NEXUS, Pondicherry. Power core Bangalore.Transformer oil Power Oil- APAR industries, Silvassa. Transol- Savitha oil Technologies Ltd.

Chart No:33.10.3.1. The purchase procedure of TELK Acceptance of order & detailed designs as per customers. Forwarding order details to production & planning department. Preparation of detailed designs as per customers specifications order & bill of materials by the design department. Preparation of product wise production schedule & product budget by production & planning department. Calculation of net requirement each items by material planning department. Preparations of material indent. Receipt of the order by the purchase department. Inviting quotations from various sources of supply. Seller selection. Internal audit and financial approval. Order is placed.3.10.3.2. Responsibility and Authorityi. Chief of Operation Overall control of all matters related to procurement.ii. Head of Materials General Administration, inter departmental co-ordination, data analysis, implementation of corrective. Communicating and initializing measures to implement management review and approval of purchase order.iii. Senior Manager/ Managera) Vender Evaluation.b) Implementing corrective action.c) Control of Records.d) Authorized person for review and approval.e) Purchase function as assigned by the Head.iv. Engineers/Asst. Engineers/ junior engineersa) Review of indent.b) Releasing enquiries.c) File processing.d) Review of purchase orders.e) Follow up with vendors.f) Any other work assigned by Head of materials/ Group In-Charges.3.10.3.3. Material Chart Of MovementThe various materials obtained from different sources are passed through different processes before getting the finished product. The movement from the initial stage of material procurement up to the final stage sales is shown in the following chart:

Chart No:4

CEO3.10.3.4. Production Planning And Control

MGRPENGINEERSAGMNF

Chart No.5: Structure of Planning DepartmentDUTIES AND RESPONSIBILITIES:1. Head & Sub Head of Planning Department:- Strategic planning of production. Plan & arrange materials in time. Prepare annual production plan & schedule. Prepare & submit statutory reports. Strategic planning of transformer production. Inter departmental/division co-ordination. Plan & Co-ordinate the activities in each production centers. Highlight delays, ship pages & other problems in production meetings. Co-ordinate the facilities, materials & components for the production. To receive order intimation from sales department. Implement management instruction & ISO requirement in Planning. Furnish data to the management on Production Performance. Carry out & implement management instructions & decisions from time in planning.2. Engineers in planning Follow-up of materials with purchase & co-ordinate inspection. Attend review meetings & report material position. Keep records & registers related to the areas. Report production problems to higher authorities. Co-ordinate the activities of various shops involved in the manufacture of the product in this area. Arrange works contract, issues & receive materials against work contract. Prepare production schedule & programmers allocate materials & components to the various jobs in his area in consultation with his superiors. Timely arrangement of materials, parts & components in their respective areas. Monitor stock & status of purchase requisitions. Get clarification from Design, regarding material & specification. Various jobs in his area in Consultation with Superiors.3.10.3.5. Material Requirements Planning Materials requirement planning & scheduling including communications of requirements and specifications to purchase department. Management reporting. To maintain quality records related to planning department. Regular liaison with purchase, inspection & stores for making materials available as per the plan. 3.10.3.5. Functions To plan Yearly/Quarterly/Monthly Production & Schedule manufacturing activities of various products. Receipt of drawings/specs from design. Distribution and control of drawings, specifications, instructions etc. among Manufacturing, Inspection & Purchase Departments. Liaison with Sales, Manufacturing & Quality Department for Customer Inspection/Clearance. Control of release of materials to various manufacturing sections, including inter-shop transportation of materials & parts wherever necessary. Required documents are maintained for control of release of materials to various manufacturing sections. Co-ordination for review of deviations & non conformities observed during production & inspection. Co-ordination & control of production activities including periodic review with the concerned Human Resources & modification of production programmes wherever necessary according to the customer requirements, availability of materials etc. Preparation of productivity Earning Report based on the accepted norms on standard man hours & as per the terms and conditions of production Agreement mutually agreed up on by the management & unions from time to time.3.10.4. PROJECT ENGINEERING DEPARTMENTThe function of Project Engineering Department is:Undertakes turnkey contracts involving planning, executing and commissioning substations for electricity utilities and industries, with stress on total service to customers. With the vast expertise and sound track record in the field of manufacture of EHV substation equipments, TELK extended its field of activity to yet another specialized area in 1985. TELK Project engineering division was set up with a view to cater to the needs of a fast developing power sector to the Indian Economy. TELKs Project engineering division (PED), has accomplished some remarkable feats in the span of twenty years of its operation. Having already executed a long series of EHV substations on turnkey basis from concept to commissioning for Indian Railways, Oil Refineries, Steel Plants, Power Supply Undertakings and Electricity Boards. TELKs Project engineering division has received ISO 9001 certification for substation installation, an inevitable end result of years of uncompromising endeavours to ensure peak perfection and highest possible standards of quality.Some of the prestigious projects executed by TELKs project engineering division are: 230kV substation foe Salem Steel Plant. 220kV switch yard extension for Nuclear Power Station, Kalpakkam. 132kV substation for Jindal Iron and Steel Co. Bombay. 110kVsubstation for MRF, Kottayam. Traction substation for Indian Railways etc.3.10.5. MARKETING DEPARTMENT3.10.5.1. Responsibilities & Authorities1. Chief of Marketing Department Overall responsibility for:I. Co-ordination within the department, inter department & regional offices.II. Co-ordination of dispatch, shipment etc.III. Monitor order execution/ processing, collection of receivables etc.IV. Tender review & order review.V. Handling of customer complaints.VI. Control of department manual instructions and standards.VII. Study internal quality reports and initiate timely corrective actions.2. Head of marketing (asst to Chief of Marketing Dept.) Direct responsibility relating to-I. Preparation & issue of Department Manual.II. Handling of Customer Complaints.III. And any other works as assigned by the Chief of Marketing Departments.3. Product Group/Export/Area officerI. Preparation of offer/Quotation.II. Correspondence with customers.III. Review of Orders. IV. Co-ordination with other Departments.V. Co-ordination of after sales service (Export).VI. Invoicing & Payment Collection.VII. Maintain records related to Contract Review & Co-ordination Activities.4. Engineers & Other OfficersI. Assist In charge Product\Export\Area In charge in their respective area.5. Regional ManagerI. Liaison between Head Office & Customers in the concerned region in marketing related works.II. Co-ordination of other functions like Purchase, Finance etc. between Head Office & other organizations.III. Administrations of Regional Office. The role of Marketing Division is to book sufficient orders from domestic and International market to feed factorys production, proper liaising & interaction with customers directly & through Regional offices, interfacing customers & various departments in the factory for the execution of contracts including the related commercial work.OBJECTIVES-The objectives of marketing department are as follows:-Continual Improvement of business through- On time delivery of quality products. Rapid response to customers. Attend customer complaints within one month. Analysis of customer perception & appropriation corrective action. 3.10.5.2. MARKETING PRINCIPLES Prompt delivery- When the cost of delay is so punishing, you need a supplier like TELK who understands the importance of timely delivery. Excellent Service to Customers-TELK realizes that customers are their strength and thus services to customer are of highest priority to TELK. Value for Customer-Good value for money is the basic priority for pricing of TELK products and many of their customers are aware of the premium price which TELK is eligible for. Uncompromising Quality Standards- TELK is a synonym for quality in the EHV power field in India and at TELK quality is way of life.3.10.6. FINANCE DEPARTMENT Finance department is another important depatment of TELK. Finance department is headed by Manager (Finance). He deals with the whole financial aspects of the company. Under his control, there are departments like Books & Accounts, Tax Affairs, Bill department, Costing, Cash, and Wage Administrations & Final Accounts.3.10.6.1. Capital Structure of TELK:Capital structure of TELK is made up of shareholders funds & loan funds. Shareholders funds include equity share capital & resources & surplus whereas loan funds consist of secure loans. Also it contains sales tax dues amounting to 219.54lakhs which has been deferred by the Government of Kerala up to 2002 without interest.3.10.6.2. Performance of TELK: During the year 1966-1980, the company is in a profitable stage. During the year 1972-1980, 12% dividend was declared. During the years 1980-1990, the company faced a loss stage. During the year 1987, TELK incurred a loss of Rs9crores. During the year 1991-1998, again the company incurs a loss stage. During the year 2002, 2003, 2004, 2005 & 2006 the company shows a profitability stage. In th

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