WINTER TRAINING ON

THE PROJECT “MARKETING OF SECONDARY PRODUCTS AND BY-PRODUCTS”

AT

BOKARO STEEL PLANT (SAIL), BOKARO

GUIDED BY: SUBMITTED BY: ANUP DEV EKKA SUBIR KUMAR SAHA

( JR. manager –Marketing) TRAINEE NO- 5905103 Bokaro Steel Plant email id-subir108@gmail.com

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Acknowledgement

An endeavor is not accomplished and successful till the people who have made it

possible are given due credit for making it possible. I take this opportunity to thank all

those who have made the endeavor of mine successful.

First and foremost, I am very thankful to all the officers of Bokaro steel plant who

really helped a lot and guided me throughout my training session, without their help I

would have been unable to complete my project. These people have really been kind

enough in providing me with all kinds of contextual information.

I would like to thank Mr. S.N.SINGH (GM, BPP, CO), Mr. B.KUMAR (GM,

STORE), Mr. V.PANDAY (GM, SSD), Mr. B.K.MANDAL (GM, PPS ) and

Mr. A.D EKKA (Jr. Manager, Marketing).

They all guided with their seasoned approach towards my training.

I also express my thanks to the officers and staffs of the training institute, Bokaro Steel

Plant.

Submitted with

regards,

SUBIR KUMAR SAHA

Trainee no. 5905103

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CERTIFICATE

STEEL AUTHORITY OF INDIA

Bokaro steel plant

This is to certify that the project work entitled “Marketing strategy of secondary & By-products of Bokaro Steel Plant” has been carried Out and submitted by ‘SUBIR KUMAR SAHA’ bearing the Trainees Number: 5905103 under my supervision and guidance in partial fulfillment of his “Master of Business Administration” from ‘shri gujrati samaj institute of professional studies (SGSIPS)’ affiliated with “devi ahilya bai university (DAVV)” during the period of 05 november-01december2012

Date:- 18th of November project guide:-

Signature:- Seal/stamp of organisation MR. Anup Dev ekka

junior manager(marketing) Admistrative building

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Bokaro steel plant(SAIL) jharkhand

INDEX

1. Executive summary Page No 5- 6

2. Objective of the study Page No 7

3. Methodology used Page No 8

4. Introduction Page No 9-50

5. Marketing dept. of BSL Page No 51- 74

6. Data Analysis Page No 75- 82

7. SWOT Analysis Page No 83- 84

8. Findings Page No 85- 86

9. Suggestions & Recommendations Page No 87- 88

10.Conclusion Page No 89

11.Abbreviation Page No 90

12.Bibliography Page No. 91

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Executive Summary

The present study was undertaken to understand the details of the mode of

marketing of Secondary Products of SAIL. Marketing Department of

B.S.L. (SAIL) strives to design a systematic framework to ascertain a

profitable proposition out of the selling efforts of secondary and by products.

The survey was conducted in Marketing Department and Sales

Coordination Department (up to some extent). I had to find how auctions,

fixed price, and tenders are used for marketing purpose in B.S.L.

Various steps involved are as follows:

1) To know about the e-auctions of marketing department.

2) To know the exhaustive usage of e-auctions to affect deals.

60% marketing and selling is done through auction and rest is taken through

fixed price, selling and tenders.

Data were mainly collected from marketing department of B.S.L.

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B.S.L. is the largest Steel manufacturing sector of India and is top ranked in

the global fortune 500 companies.

During my training, I had to find out mode of sale of secondary products of

B.S.L. Primary products are sold by CMO, Delhi. I passed through various

stages of problems and difficulties to accomplish the task of project work

but it was a privilege for me to take this opportunity and challenging work to

study and observe "marketing of Secondary products in B.S.L.".

Bokaro Steel Plant recognizes that leadership is essential for survival in

competitive environment; Customer's satisfaction ,like quality, is a journey

and not a destination. It is essential that everyone in the company has a clear

understanding of what customer satisfaction means, if the plant aims to

achieve leadership in customer satisfaction. While improved customer

satisfaction is necessary for ensuring prosperity of the company, it must also

be recognized that ability of the company to satisfy its customers would

depend on its ability to continuously improve its profit and growth.

The basic objective behind the study carried out by me is to study the major

contribution of Secondary product to total sales, which is helpful for the

success of the company. By selling the secondary products in local market

company is earning profits. It is also creating employment in small scale

industries and is therefore instrumental in developing the economy.

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OBJECTIVE OF THE

STUDY

In Bokaro steel plant there is various section of marketing

department. Since I have chosen "Marketing of secondary

products in B.S.L." my main objectives are:-

1. To know what is secondary product, by product and why

is it necessary to sell the secondary product.

2. To know the use of secondary product & by-product.

3. Market study of secondary product & by-product in BSL.

4. To know the pricing of secondary product & by-product.

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5. Ensuring timely dispatch of material, products, scrap etc

to the potential customers.

6. To know the others terms and conditions for marketing of

secondary products.

METHODOLOGY

USEDThe methodology adopted by me during the project on "Marketing of

Secondary Product on B.S.L." can be divided into two parts:

(A) To know about the organization

(B) To know about the procedure and working of Marketing Department

and Secondary Section.

(A) To know about the organization. Information / data has been

collected from:-

(i) Government Publications.

(ii) Books of organization.

(iii) Journal.

(iv) Company Website.

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(B) To know about the procedure and working of Marketing

Department and Secondary Section information has been collected by:

(a) Observation Method

(b) Personal Interview with

(i) AGM

(ii) Senior managers

(iii) Managers

(C) Documents provided by them.

INTRODUCTION TO SAIL

Steel Authority of India (SAIL) consists of several steel plants that are integrated and

otherwise in nature. It caters to the humongous need of railways, automotive,

engineering, and power sectors of the country. Moreover, it satisfies the requirements of

its foreign clients also whenever they demand its support.

During the struggle for independence, Pt. Jawaharlal Nehru, our first Prime Minister, had

a very clear vision about the role of Steel in the development of our country. Although

TATA Iron & Steel Company (TISCO) has been establishment in 1907 marking the

beginning of Indian Steel Industry followed by Indian Steel Co. (1918), they were too

small to meet the development requirements of a big country like ours. Therefore, in the

1st Industrial Policy Resolution of the Govt., soon after independence, Govt. decided to

establish Steel Plants in Public Sector. However, work could be started at fast pace only

in 1954, when Hindustan Steel Ltd., was formed and three Steel Plants of 1 MT capacity

each, were established with provision of further expansion at Bokaro, Rourkela and

Durgapur with assistance from USSR, West Germany and U.K. respectively.

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To improve the functioning of Steel Industry, Govt. decided to form a holding company

during 1972, which was named as Steel Authority of India Ltd., (SAIL) and the same was

incorporated on January 24, 1973, with an authorized capital of Rs.2000 crores.

SAIL was formed by registration of a company under the companies Act and not by the

Act of Parliament. Govt. decided to abandon the holding company concept in 1978 and a

bill was presented to the Lok Sabha. Accordingly, SAIL was again recognized in the

following manner.

Hindustan Steel Ltd., Bokaro Steel Ltd., Salem Steel Ltd., SAIL International Ltd., Bhilai

Ispat Ltd., Rourkela Ispat Ltd., Durgapur Ispat Ltd., wholly owned subsidiaries of SAIL

merged into it and started functioning as Units of SAIL.

MECON, HSCL and NMDC become independent Companies and started functioning

under Ministry of Steel. However, Kiriburu and Meghatuburu Iron Ore Mines were

attached with BSL as their Captive Mines.

Bharat Refectories Ltd. also became independent under the Ministry of Steel and

refractory units also came under them.

Thus, SAIL, at present, is having capacity of 12 MT of crude steel through its four

integrated Steel Plants, at Bokaro, Bhilai, Durgapur and Rourkela. Two special steel

plants at Durgapur and Salem produce a wide range of alloy and special steels. Marketing

of the products from these plants is done through a country wide distribution network

consisting of a chain of Stock Yards and distribution network.

SAIL today is one of the largest industrial entities in India. Its strength has been

the diversified range of quality steel products catering to the domestic as well as the

foreign markets and a large pool of technical and professional expertise.

Ranked amongst the top ten public sector companies in India in terms of

turnover, SAIL manufactures and sells a broad range of steel products, including hot and

cold rolled sheets and coils, galvanized sheets, structural, railway products, plates, bars

and rods, stainless steel and other alloy steels. SAIL produces iron and steel at four

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integrated plants and three special steel plants, located principally in the eastern and

central regions of India and situated close to domestic sources of raw materials, including

the Company’s iron ore, limestone and dolomite mines.

SAIL’s wide range of long and flat steel products are much in demand in the domestic as

well as the international market. This vital responsibility is carried out by SAIL’s own

Central Marketing Organization (CMO) and the International Trade Division. CMO

encompasses a wide network of 38 branch offices and 47 stockyards located in major

cities and towns throughout India.

With technical and managerial expertise and know-how in steel making gained over four

decades, SAIL’s Consultancy Division (SAILCON) at New Delhi offers services and

consultancy to clients world-wide.

SAIL has a well-equipped Research and Development Centre for Iron and Steel (RDCIS)

at Ranchi which helps to produce quality steel and develop new technologies for the steel

industry. Besides, SAIL has its own in-house Centre for Engineering and Technology

(CET), Management Training Institute (MTI) and Safety Organization at Ranchi. SAIL’s

captive mines are under the control of the Raw Materials Division in Calcutta. The

Environment Management Division and Growth Division of SAIL operate from their

headquarters in Calcutta. Almost all SAIL’s plants and major units are ISO Certified.

OWNERSHIP AND MANAGEMENT

The Government of India owns about 86% of SAIL's equity and retains voting control of

the Company. However, SAIL, by virtue of its "Maharatan" status, enjoys significant

operational and financial autonomy

INTEGRATED STEEL PLANTS

1. Bhilai Steel Plant (BSP) in Chhattisgarh

2. Durgapur Steel Plant (DSP) in West Bengal

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3. Rourkela Steel Plant (RSP) in Orissa

4. Bokaro Steel Plant (BSL) in Jharkhand

5. IISCO Steel Plant (ISP)

SPECIAL STEEL PLANTS

1. Alloy Steel Plant (ASP) in West Bengal

2. Salem Steel Plant (SSP) in Tamil Nadu

3. Visvesvaraya Iron & Steel Plant (VISL) in Karnataka

SUBSIDIARIES

1. Indian Iron & Steel Company Limited (IISCO) in West Bengal.

2. Maharashtra Electrosmelt Limited (MEL) in Maharashtra

OTHER UNITS

Raw Material Division (RMD) at Kolkata, West Bengal

Central Marketing Organization (CMO) at Kolkata, West Bengal

SAIL Consultancy Division (SAILCON) at New Delhi

Research & Development Centre for Iron & Steel (RDCIS)

at Ranchi, Jharkhand

Centre for Engineering & Technology (CET) at Ranchi, Jharkhand

Management Training Institute (MTI) at Ranchi, Jharkhand

Central Power Training Institute (CPTI) at Rourkela, Orissa

SAIL Safety Organization (SSO) at Ranchi, Jharkhand

Environment Management Division (EMD) at Kolkata, West Bengal

Growth Division (GD) at Kolkata, West Bengal

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Central Coal Supply Organization (CCSO) at Dhanbad, Jharkhand

ABOUT METAL JUNCTION

Corporations across the world have realized that in a world without boundaries, certain

regions and people with distinct competencies will be more efficient than others and

therefore the visible trend in the world today is outsourcing. Companies are outsourcing

manufacturing activities, customer services, back office operations and a host of other

activities, either because there is someone else who can do the same thing for less, or,

there is specialist who can offer services of higher quality. Industry has recognized that

whilst it has to concentrate on growth, a prerequisite is to become globally competitive.

Industry has to, on the one hand, concentrate on its core competencies of bringing about

efficiencies in manufacturing and on the other hand look at bringing about efficiencies in

their Supply Chain which is their buying and selling processes. Metal-junction operates at

the extreme ends of the value chain and hence it was essential to segregate the

organization into two Major Business Units (Commerce-junction and Metal-junction) so

as to independently focus on:

Specific Requirements of Clients/Customers

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Specific procedures for both the functions

Knowledge and Information management for the two functions

OTHER UNITS OF SAIL

RAW MATERIAL DIVISION

The Raw Material Division (RMD) was formed in 1989 with headquarters in Kolkata for

management of all the captive mines of the SAIL steel plant in the eastern sector. This

has enabled rationalization of raw material supply to the different plants in the region and

achievement of systematic reduction in purchase of iron ore from non-captive sources.

Presently, RMD manages five iron ore mines in Jharkhand and Orissa, and four limestone

and dolomite quarries in Madhya Pradesh, Jharkhand and Orissa.

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Iron Ore Mines

Mines State Annual capacity (MT)

Kiriburu Jharkhand 4.25

Meghahatuburu Jharkhand 4.30

Bolani Orissa 3.00

Barsua Orissa 2.01

Kalta Orissa 1.15

RMD is planning to expand capacity in view of the enhanced production plans of the

steel plants and cope with the requirement of high quality iron ore.

The Lime stone quarries under RMD are located at Kuteshwar, Purnapani and

Bhawnathpur. Dolomite quarry is at Tulsidamar.

RMD has centralized workshop at Bolani for repair/overhauling of engines &

transmission of heavy earthmoving machinery operating at the mines.

Besides the above, RMD has three customer service office at Rourkela, Durgapur and

Bokaro for coordination with the steel plants. Two liaison offices are also maintained at

Bhubaneshwar and New Delhi for better coordination with government agencies and

other statutory authorities.

CENTRAL COAL SUPPLY ORGANISATION

Situated at Dhanbad in Jharkhand, the Central Coal Supply Organization (CCSO) of

SAIL’s Operations Directorate, is entrusted with the vital responsibility of ensuring daily

movement of around 12000 tons each of washed coking coal and power –grade coal to all

sail steel plants.

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CENTRAL MARKETING ORGANISATION

The ISO 9001:2000 certified Central Marketing Organization (CMO) is India’s largest

industrial marketing set up that markets carbon steel produced by the four integrated steel

plants of SAIL. Headquartered in Kolkata, it transacts business through its network of 34

branch sales offices spread across the four regions, 24 Warehouses equipped with

mechanized handling systems, 11 Customer Contact Offices and 15 Consignment Agents.

CMO’s domestic marketing effort is supplemented by its ever widening network of

authorized and rural dealers who meets the demands of the smallest customers in the

remotest corners of the country. A strong IT support system enables real time network

connectivity within the entire CMO network.

Extensive customer contact, product and segment specialization, close monitoring of

order servicing and feedback analysis through the Customer satisfaction Index are

established norms at CMO. The customer friendly approach of CMO is backed by

practical after sales service.

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Through the process of Key Account Management, CMO provides single window service

to key customers across the country for every business transaction from enquiry to order

booking, order tracking to delivery, and even consultancy after-sales service.

Central Marketing Organization (CMO) is India's largest marketing home. It has spread

its wings far and wide from Srinagar in the North to Cochin in the South and Dhimapur

in East to Ahmedabad in the west.

All SAIL Product are marketed in India through C.M.O. to ensure quality and prompt

dispatch of product, CMO keeps in touch with producing units as well as the transport

and shipping sectors. It operates through the network of stockyards, dockyards, Branch

sales offices, consignment agents and Extension counter.

CMO has got responsibility to sell pig iron and mild steel products manufacture by BSL,

DSP, RSP, and BSL, having its headquarters at Ispat Bhavan, 40 Chouringee Road,

Kolkata 71. CMO Branches spread throughout the country with stockyards for storing

and selling Iron & Steel materials of the plants.

Branch manager having other colleagues including finance executive to help Branch

Manager in day-to-day operations.

The network of branches is divided into Four regions as given below: -

Regions Branches Attached

Northern region, New Delhi Agra, Allahbad, Faridabad, Gaziabad,

Kanpur, Lucknow, Delhi, Chandigarh,

Jalandher, Jammu

Ludhiana and Mandi Govindgarh.

Western Region, Ahmedebad, Baroda, Pune, Mumbai,

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Mumbai Nagpur,Bokaro, Indore, Gwalior, Jabalpur,

Jaipur & Kota.

Eastern Region,

Kolkata

Bhubaneshwar, Bokaro, Kolkatta,

Durgapur Guwahati, Howarh, atna, New

Bongaigoan & Rourkela.

Southern Region,

Chennai

Bangalore, Chennai, Cochin, Coimbatore,

Hyderabad, Pondicherry, Trichy & Vijayawada

In addition to above, one zonal office is functioning in Guwahaati. CMO has got

transport and shipping department at Visakhapatnam to handle the export and import

consignment at the different ports.

FUNCTIONS OF BRANCHES:-

I) Booking of orders from the customers on long term and short-term basis.

II) Passing on details of booking to the concerned SRM Office.

III) Receipt of materials at stockyard by wagons/trucks.

IV) Issuance of offers and delivery orders to customers against their booking.

V) After sale services to customers.

With increasing competition and business scenario, it is their endeavor to increase the

market share and customer satisfactions have appointed KAMs- Key Account Managers

at the branch level and operations at branch level have been segmented on the type of

product-Flat or long. CMO is divided on Long and Flat basis as both types of products

have to be dealt in different manner due to nature of application and varied uses.

Similarly, for better customer satisfaction, Customer Satisfaction Index (CSI) has to be

measured for the Key Account Customers. The Key Account Customer has been

identified on branch and national level and TMI and KAM of CMO are following these

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customer's orders. AT plant level, PAC and PIC are appointed who have full knowledge

of products and process. The production and coordination meeting is held in the last week

of preceding month to decide the final product mix.

FUNCTION OF STOCKYARDS

i) Keeping records with regards to receipt of materials with description of

size, quality and quantity etc.

ii) Issuance of loading slip on receipt of delivery order from the branch.

iii) Loading of materials in the customer truck/trailer free of cost.

iv) Issuance of delivery challans-cum-invoice for the quantity delivered.

v) Handing over Test Certificate to customer along with challans.

vi)Submission of stock statement to the branch.

CMO’s International Trade Division (ITD)

In New Delhi exports iron & steel products of SAIL’s four main integrated steel plants

and maintain close liaison with buyers abroad. ITD has successfully established SAIL’s

reputation as a producer of quality steel products and a consistent supplier across the five

continents. Among the notable destinations are China , Korea, USA, Canada, Philippines,

Indonesia, Malaysia, Saudi Arabia, Iran UAE, Europe(UK, Italy, Spain, Germany),

Taiwan, Japan, Thailand and Singapore, as well as neighboring countries like Sri Lanka,

Myanmar, Nepal and Bangladesh, etc.

The critical function of ensuring efficient and proper dispatch of export materials and

timely import of raw materials to maintain the pace of production of the SAIL, plants is

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performed by CMO’s Transport & Shipping Division (T&S). Headquartered at Kolkata,

T&S has branch offices at Haldia, Paradip and Vizag ports.

Both ITD and T&S are accredited with ISO 9001:2000 certification.

JOINT VENTURE

SAIL has promoted joint ventures in different areas ranging from power plants to e-

commerce.

NTPC SAIL Power Company Pvt. Ltd

Set up in March 2001, this 50:50 joint venture between SAIL and the National

Thermal Power Corporation (NTPC) operates and manages the Captive Power Plants-

II of the Durgapur and Rourkela Steel Plants which have a combined capacity of 240

MW.

Bokaro Power Supply Company Pvt. Limited

This 50:50 joint venture between SAIL and the Damodar Valley Corporation formed

in January 2002 is managing the 302-MW power generation and 1880 tons per hour

steam generation facilities at Bokaro Steel Plant.

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Bokaro Electric Supply Company Pvt. Limited

150 Another SAIL-NTPC joint venture on 50:50 basis formed in March 2002

manages the 74 MW Power Plant-II of Bokaro Steel Plant which has additional

capacity of producing tones of steam per hour.

UEC SAIL Information Technology Limited

This 40:60 joint venture between SAIL and USX Engineers & Consultants, a

subsidiary of the US Steel Corporation, promotes information technology in the steel

sector. 

Metaljunction.com Private Limited

A joint venture between SAIL and Tata Steel on 50:50 bases, this company promotes

e-commerce activities in steel and related areas.

SAIL-Bansal Service Center Pvt. Ltd.

SAIL has formed a joint venture with BMW industries Ltd. on 40:60 bases to

promote a service centre at Bokaro with the objective of adding value to steel.

North Bengal Dolomite Limited

A joint venture between SAIL and West Bengal Mineral Development Corporation

ltd on 50:50 basis was formed for development of Jayanti Dolomite Deposit,

Jalpaiguri for supply of Dolomite to DSP and other plants.

Romelt-SAIL (India) Ltd

Romelt Technology developed by Russia for reducing of iron bearing materials,

which is carried out with carbon in single A joint venture between SAIL, National

Mineral Development Corporation (NMDC) and Russian promoters for marketing

stage reactor with the use of oxygen.

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Bhilai JP Cement Ltd

SAIL has also incorporated a joint venture company with M/s Jaiprakash Associates

Ltd to set up a 2.2 MT cement plant at Bhilai. Likely to commence operations by

March'2010.

PRODUCTS

SAIL’S MAJOR PRODUCTS

SAIL has a wide range of steel products - both Long and Flat.

Among Long products are: Structurals, Crane Rails, Bars, Roads & Rebars, and Wire

Rods; and Flat products covering the range of HR Coils, Sheets & Skelp, Plates, CR

Coils & Sheets, GC Sheets/GP Sheets and Coils, Tinplates, Electrical Steel. SAIL also

produces Tubular products and Railway products such as rails, wheels, axles and wheel

sets.

Other products of SAIL include Pig iron and Fertilizers such as Calcium Ammonium

Nitrate ("Sona"), Ammonium Sulphate ("Raja") and Coal Chemicals like Benzene,

Toluene, Xylene etc.

  Product Wise

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  SemisBlooms, Billets & Slabs

 

  Long ProductsStructural

Crane Rails

Bars, Rods & Rebars

Wire Rods

 

  Flat Products HR Coils, Sheets & Skelp

Plates

CR Coils & Sheets

GC Sheets\ GP Sheets and Coils

Tinplates

Electrical Steel

 

  Tubular

Products  

Pipes

 

  Railway

Products

Rails

Wheels, Axles, Wheel Sets

 

  Plant Wise

  Bokaro Steel Plant HR Coils & Sheets

Plates

CR Coils & Sheets

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GP Sheets & Coils/ GC Sheets

Pig Iron,

  Durgapur Steel Plant Blooms, Billets & Slabs

Joists, Channels, Angles

Bars, Rods & Rebars

Skelp

Wheels, Axles, Wheel Sets Pig Iron,

Chemicals & Fertilizers

 

  Rourkela Steel PlantHR Coils

Plates

CR Coils & Sheets

GP Sheets/ GC Sheets

Tinplates

Electrical Steel

Pipes

Pig Iron, Chemicals & Fertilizers

 

 

Bhilai Steel PlantBlooms, Billets & Slabs Beams

Channels, Angles

Crane Rails

Plates

Rails

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Pig Iron, Chemicals & Fertilizers

Products

Hot Rolled Coils, Sheets and Skelp

Hot rolled coils, sheets and skelp (narrow coil), are

the largest product category of the company in terms

of both sales volume and revenue. Hot rolled coils

are primarily used for making pipes and have many

direct industrial and manufacturing applications,

including the construction of tanks, railway cars,

bicycle frames, ships, engineering and military equipment and automobile and truck

wheels, frames and body parts. Hot rolled coils are also used as feedstock for cold rolling

mills where they undergo further processing. Hot rolled coils are also delivered to the

company's own cold rolling mills and silicon sheet mill and pipe plant in a wide range of

widths and thicknesses as the feedstock for higher value-added steel products. The

company is the largest producer of hot rolled coils, sheets and skelp in India.

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Semi-Finished Products

The company produces semi-finished products,

including blooms, billets and slabs, which are

converted into finished products in the company's

processing plant and, to a lesser extent, sold to rerollers

for conversion to finished products.

Plates

Steel plates are used mainly for the manufacture of bridges, steel structures, ships, large

diameter pipes, storage tanks, boilers, railway wagons and pressure vessels. The company

also produces weatherproof steel plates for the construction of railcars. The company is

currently the largest producer of steel plates in India with a domestic market share of

more than 80 per cent for these products. The company is the only producer of wide and

heavy plate products in India.

Cold Rolled Products

Cold rolling of hot rolled products produces a

superior surface finish, improves the physical

properties of the steel, such as tensile strength, and

reduces its thickness to precise gauges. As a result,

cold rolled products generally command higher prices than hot rolled products. The

products of the cold rolling mill include cold rolled sheets and coils, which are used

primarily for precision tubes, containers, bicycles, furniture and for use by the automobile

industry to produce car body panels. Cold rolled products are also used for further

processing, including for color coating, galvanizing and tinning. The company also

produces further processed cold rolled products,

including galvanized sheets and tin plates. 

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Railway Products

Railway products, including rails, wheels and

axles, sleeper and fish plates (which are used to

connect and strengthen rails), are produced

through a process of hot rolling blooms in the

finishing mills and forging ingots and blooms in

the forging press or hammer. Railway products are

used primarily to upgrade and expand the existing

railway network in India.

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Structurals

Structural steel products are produced through a

process of hot rolling in the section or structural

mills. They are long steel products with cross

sections of various shapes. I-beams, channels and

angle steel are used in mining, the construction of

tunnels, factory structures, transmission towers,

bridges, ships railways and other infrastructure projects.

Bars and Rods

The company produces steel bars and rods through a process of hot rolling billets in the

finishing mills. Reinforcement steel and wire rods

are primarily used by the construction industry. The

company is one of the largest producers of

reinforcement bars in India which are primarily sold

to the construction industry.

Speciality Products

Speciality products include electrical sheets, tin plates and pipes. Electrical sheets are

cold rolled products of silicon steel for electrical machinery. Tin plates are cold rolled

steel electrolytically coated with tin for food packaging. Pipes are longitudinally or

spirally welded from hot rolled coils for conveying such things as water, oil and gas.

Alloy and Stainless Products

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In addition to the steel products indicated above, SAIL produces a wide range of alloy

steel products at ASP, SSP and VISL. Elements including chromium, nickel, vanadium

and molybdenum are used in the alloy mixture to impart special properties to steel. These

alloy steels are primarily used for sophisticated applications, including in the automobile,

railway and defense industries.

A wide variety of alloy and stainless steel plates, hot rolled sheets, cold rolled sheets,

bars, billets, blooms, forgings and die blocks are manufactured at ASP in an Electric Arc

Furnace. SAIL is able to produce different qualities of alloy steels to meet the

requirements of its customers. To increase steel's corrosion resistance properties, nickel

and chromium are used in the making of stainless steel. SSP produces cold rolled

stainless steel coils and sheets with thickness ranging from 0.3 mm to 6 mm and width

ranging from 500 mm to 1,250 mm. These materials can be produced in a large number

of grades for different applications. Stainless steel products are used for diverse

applications including household utensils, automobile trims, conveyor belts, elevators,

chemical and food processing equipment, building and interior decoration and

pharmaceutical equipment.

MAJOR COMPETITOR'S

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TISCO Essar Steel Jindal Vijaynagar Steels ltd. Jindal strips ltd Jisco Saw pipes Uttam steels ltd Ispat Industries ltd Mukand ltd Mahindra Ugine steel company ltd Tata SSL ltd Usha Ispat ltd Kalyani Steel ltd Electro steel Casting ltd Sesa Goa ltd NMDC Lloyds Steel Industries ltd

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SAIL, BOKARO STEEL PLANT

HUMAN RESOURCE

SAIL’s total manpower at the end of 30 April, 2009 stood at around 26,288.

The company’s labor productivity 244.02 tones/man/year as on 30.04.09.

Raw Materials & Material Handling Plant

The Raw Materials and

Material Handling Plant

receives blends, stores and

supplies different raw

materials to Blast Furnace,

Sinter Plant and Refractory

Materials Plant as per their

requirements. It also

maintains a buffer stock to

take care of any supply

interruptions. Some 9 MT of different raw materials viz. Iron ore fines and lumps,

Limestone (BF and SMS grade), Dolomite lumps and chips, hard Coal and Manganese

ore are handled here every year.

Iron ore and fluxes are sourced from the captive mines of SAIL situated at Kiriburu,

Meghahataburu, Bhawanathpur, Tulsidamar and Kuteshwar. Washed coal is supplied

from different washeries at Dugda, Kathara, Kargali and Giddi, while raw coal is

obtained from Jharia coalfields.

31

Coke Oven & By-product Plant

The Coke Oven Complex at Bokaro converts prime coking coal from Jharia, Dugda and

Moonidih and medium coking coal form Kargali, Kathara and Mahuda, blended with

imported coal, into high quality coke for the Blast Furnaces.

Coals came in wagon in the plant and then unload with the

help of wagon tippler. At Tippler single wagon fix up and

then tippler turn to 180 degree and coal store into

underground storage and after that coal sent to SILO which is

permanent storage place of coal, through conveyor belt.

There are 46 no. of SILO in BSL and one SILO has capacity

of 2500 ton.

Currently there are two Tipplers working at BSL.

32

From SILO coal has sent to coal hammering section where coal crushing has done and

then coal has sent to battery charger section where coal were charge at 1200 degree

centigrade in battery oven and that process take 18 hrs to give output of 18 ton coke from

input of 22.8 ton of coal.

There are 8 batteries at BSL but only 6 are in working

condition. One battery contains 69 ovens. One oven has

capacity to take 22.8 ton of coal in one time.

After coke making process has completed it will unload into

quenching car and cooling process has done through phenol

water for 2 min 35 sec. then coke will sent to coke wharf

section where dolomite has mix with coke and then it will

sent to coke crushing section where coke has crushed and it

will take three sizes 0-10mm, 10-25mm and 25-80mm. In coke screening section

different sizes of coke were separated. The coke has size of 25-80mm has use in Blast

Furnace.

At the time of making of coke, carbon mono oxide gas has produced because of chemical

reaction. This CO gas will be further proceeding and that produced different type of By-

product.

Ammonium liquor has used for washing of CO which produces COALTAR which has

sent to TAR distillation plant where different type of TAR product produces like hard

pitch, soft pitch, naphthalene etc. and through exhauster CO has sent to ammonium

sulphate section where Amonia Sulphate has produced which is used as fertilizer. Then

further washing of CO produces Benzene product at Benzene recovery section. Once

Carbon Mono Oxide has washed it will used as major fuel in different section of the

plant.

33

Blast Furnaces

Bokaro has five 2000-cubic meter Blast Furnaces that produce molten iron - Hot Metal -

for steel making currently four are working. Bell-less Top Charging, modernized double

Cast Houses, Coal Dust Injection and Cast House Slag Granulation technologies have

been deployed in the furnaces. The process of iron-making is automated, using PLC

Charging System and Computer Controlled Supervision System. The wastes products

like Blast Furnace slag and gas are either used directly within plant or processed for

recycling / re-use.

34

At Blast Furnace Iron-ore, Coke,

Limestone and Silicon are put

into charged at furnace as per

requirement from upper side of

the furnace and from bottom, hot

air pressure has given and a

chemical reaction last for 8

hours, known as reduction

process, which produces Molten

Iron and part of Slag.

This Molten Iron known as Hot Metal kept in Mild Steel tub which has refractory coating

inside and sent to Steel Melting Shop.

Steel Melting Shops

Hot Metal from the Blast Furnaces is converted

into steel by blowing 99.5% pure Oxygen

through it in the LD converter. Suitable

alloying elements are added to produce

different grades of steel.

Bokaro has two Steel Melting Shops - SMS-I

and SMS-II. SMS-I has 5 LD converters of

130T capacity each. It is capable of producing

Rimming steel through the ingot route. SMS-II has 2 LD converters, each of 300 T

capacities, with suppressed combustion system and Continuous Casting facility. It

produces various Killed and Semi-Killed steels.

35

Continuous Casting Shop

The Continuous Casting Shop has two double-strand slab casting machines, producing

high quality slabs of width ranging from 950 mm to 1850 mm. CCS has a Ladle Furnace

and a Ladle Rinsing Station for secondary refining of the steel. The Ladle Furnace is used

for homogenizing the chemistry and temperature. The concoct machines have straight

moulds, unique in the country, to produce internally clean slabs.

Argon injection in the shroud and

tarnish nozzle prevent re-oxidation and

nitrogen pick-up, maintaining steel

quality. The eddy current based

automatic mould level control, unique

in the country, gives better surface

quality. The air mist cooling and

continuous straightening facilities keep

the slabs free from internal defects like

cracks. The casters are fully automated with dynamic cooling, on-line slab cutting, de-

burring and customized marking. The shop is equipped with advanced Level-3

automation and control systems for scheduling, monitoring and process optimization.

CCS produces steel of Drawing, Deep Drawing, Extra Deep Drawing, Boiler and Tin

Plate quality. It also produces low alloy steels like LPG, WTCR, SAILCOR and API

Grades.

Slabbing Mill

Slabbing Mill transforms ingots into slabs by rolling them in its 1250 mm Universal

Four-High Mill. The rolling capacity of the Mill is 4 MT per annum. The shop has Hot

and Cold Scarfing Machines and 2800 T Shearing Machine. Controlled heating in

36

Soaking Pits, close dimensional accuracy during rolling and hot and cold scarfing help

produce defect-free slabs.

Hot Strip Mill

Slabs from CCS and Slabbing Mill

are processed in the state-of-the-art

Hot Strip Mill. The fully automatic

Hot Strip Mill with an annual

capacity of 3.363 million tones has a

wide range of products - thickness

varying from 1.2 mm to 20 mm and

width from 750 mm to 1850 mm.

The mill is equipped with state-of-the-art automation and controls, using advanced

systems for process optimization with on-line real time computer control, PLCs and

technological control systems.

Walking Beam Reheating Furnaces, consisting six zones and total length of furnace is

39.5 meter, provide uniform heating of 1250 degree centigrade with reduction in heat

losses, ensuring consistency in thickness throughout the length. High-pressure De-scaling

System helps eliminate rolled-in scale. Edgers in the roughing group maintain width

within close tolerance. The roughing group has a roughing train of a Vertical Scale

Breaker, one 2-high Roughing Stand and four 4-high Universal Roughing Stands. The

finishing group consists of a Flying Shear, Finishing Scale Breaker and seven 4-high

Finishing Stands. Hydraulic Automatic Gauge Control system in the finishing stands

ensures close thickness tolerance. The Work Roll Bending System ensures improved strip

crown and flatness. The rolling speed at the last finishing stand is between 7.5-17.5

meters per second. The Laminar Cooling System is a unique feature to control coiling

temperature over a wide range within close tolerance. The Hydraulic Coilers maintain

perfect coil shape with On-line Strapping system. On-line Robotic Marking on the coil

helps in tracking its identity.

37

Hot Rolled Coil Finishing

All the Hot Rolled coils from the Hot Strip Mill are received in HRCF for further

distribution or dispatch. HR Coils rolled against direct shipment orders are sheared and

finished to customer-required sizes and dispatched to customers. The material is supplied

as per Indian specifications and many international/ foreign specifications. The shop has

two shearing lines with capacities of 6,45,000 Tones/ year and 4,75,000 Tones/ year

respectively.

Cold Rolling Mill

The Cold Rolling Mill at Bokaro uses state-of-the-art technology to produce high quality

sheet gauge material, Tin Mill Black Plate and Galvanized Products. Cold rolling is done

to produce thinner gauge strips of very smooth and dense finish, with better mechanical

properties than hot rolling strips. Rolling is done well below re-crystallization

temperature without any prior heating of the material. The products of CRM are used for

deep drawing purposes, automobile bodies, steel furniture, drums and barrels, railway

coaches, other bending and shaping jobs and coated steels. The CRM complex comprises

of two Pickling Lines (including a high speed Hydrochloric Acid Pickling Line with re-

generation facilities), two Tandem Mills, an Electrolytic Cleaning Line, a Continuous

Annealing Line, Bell Annealing Furnaces, two Skin-Pass Mills, a Double Cold Reduction

Mill (DCR), and Shearing Lines, Slitting Lines and a packaging and dispatch section. The

5-stand Tandem Mill is capable of rolling sheet gauges up to 0.15 mm thickness. It has

sophisticated Hydraulic Automatic Gauge Control, computerized mill regulation and

optimization control.

38

Hot Dip Galvanizing Complex

The Hot Dip Galvanizing Complex integrated with the CRM produces zinc-coated Cold

Rolled strips resistant to atmospheric, liquid and soil corrosion.

The Continuous Coil Corrugation Line in the HDGC produces corrugated sheets and the

Galvanized Sheet Shearing Line produces galvanized plain sheets for a variety of

applications. The first shop of Bokaro Steel to get the ISO-9001 certification way back in

1994, this complex has maintained a high-standard of coating quality and its SAIL

JYOTI branded products enjoy a loyal market.

This complex made certain innovations for higher productivity to help re-build

earthquake-ravaged Gujarat.

There are two coil holders at starting point for maintaining continuity of the machine.

When one coil finished the second started and head & tail of two coils weld together

through welding machine. Then sheet passes through entry storage tower which create

storage loop and provide time for welding two coils.

39

After that sheets passes through non-oxidizing furnace and sheets are cleansed through

heat then sheets dipped into liquid of ZINK and a layer will coated on sheets. At the same

place a machine is used to remove extra layer of ZINK through Hot Air. Then it will

passes through High-Bay and the process of cooling of sheet has started by Water & Air.

This all is a continuous flow line and at the end of it two coil sheet remover has used to

make the coil roll of sheets.

Services - a valuable support network

The service departments like Traffic, Oxygen Plant, Water Management and Energy

Management provide invaluable support to this gigantic plant. Bokaro Steel has a vast

networked of railway tracks and over 40 diesel locos to smoothly run its operations. The

Oxygen Plant provides Oxygen, Nitrogen and Argon for processes like steelmaking and

annealing. Water Management looks after the huge water requirements of the plant and

the township, providing different grades of water and taking care of recycling needs.

Energy Management juggles the supply and demand of by-product gases and their

demand as process fuel.

Maintenance Departments

Bokaro has centralized maintenance departments for large-scale electrical and

mechanical maintenance, in addition to shop-based maintenance wings for running

repairs and maintenance. These facilities are capable of executing massive capital repairs,

supported by the fabrication facilities of the auxiliary shops.

40

Auxiliary Shops

To meet its needs for maintenance and repairs, Bokaro has a cluster of engineering shops

such as Machine Shop, Forge Shop, Structural Shop, Steel Foundry, Ingot Mould

Foundry, Cast Iron and Non-Ferrous Foundry, Electrical Repair Shop and Power

Facilities Repair Shop in addition to shop-specific Area Repair Shops. Most of the repairs

and maintenance requirements of the plant are met in-house.

The auxiliary shops and maintenance wings of Bokaro Steel, aided by in-house design

teams, have executed a number of highly sophisticated procurement-substitution,

productivity enhancement and quality improvement jobs, saving revenues and enhancing

equipment availability.

The expertise and operational scale of these departments, along with the service

departments, makes Bokaro a truly integrated plant, housing many virtual enterprises

within Bokaro Steel.

Scrap and Salvage Department

As the name signifies, the department works with Ferrous [Iron & steel] scrap to salvage

it & make it useful by adding value to it. SSD has a dual role to play in overall scheme of

things in the works division. Primarily it has to supply Iron and Steel scrap to Steel

Melting Shop (SMS) as a technological input in the Steel Melting process. Secondly, the

role of SSD is to collect all the Ferrous Scrap (waste for the place of origin) and bring it

to the department to transform it into a useful product. Every department of the plant

from Coke Oven to Cold Rolling Mill produce mental waste termed scrap. This may be in

the form of maintenance waste e.g. broken or worn out parts, damaged structure or

equipment or may be process arising. The prime products continue on their production

flow towards the final defined output, while the arising has to drop out as they are not

suitable chemically, mechanically or by size and shape. In the shape of fish tails or

41

irregular edge trimming or produce which are below the planned size. In a nut shell

SSD’s role is to ensure that all Iron and Steel Scrap (unwanted at place production) are

transported to site processed and transformed to usable shape, size and quality (free of

slag etc.) and transported SMS Magnetic Scrap Yards for using as coolant in the

converter bath. Surplus scrap after supplying the requirement of scrap is offered for

external sale to generate cash resources for the Company.

Function of the Department

Scrap is one of the essential raw material inputs of the steel making process, though it

does not play a direct role in the chemical reaction. Yet it has a vital role as a coolant in

the process and helps the steel maker control the converter bath temperature. This control

is essential for smooth operation of the converter. Other materials also act as coolants e.g.

Iron ore, Limestone, Lime Dolomite. They however have different effects on the process

in addition to cooling so adequate quantity of scrap is the best coolant. Hot metal

chemical composition and finished steel specification are some of the factors, which

determine the proportion of Iron and Steel Scrap to be used. In addition the density

determines whether it is light voluminous (of heavy compact) it is desirable light scrap

e.g. bales should be added first. This gives cushioning effects and protects the costly

converter refractory lining from damage. Apart from quantity, the quality of the scrap is

also important and a matter of concern for the steel maker. The scrap for charging into

the converter should be clean and free from non-metallic impurities like slag, Soil,

Refractory etc. Size and weight 1 to 2 Tones maximum. The steel maker expects clean,

sized, proportionate scrap in adequate quantity. It is the responsibility of SSD to ensure

regular and continuous supply of clean, sized scrap in adequate quantity and proper

proportions so that Steel Making can continue uninterruptedly.

42

Various section and their brief activities

The scraps are received from all of the shops and after necessary inspection these are

diverted to respective processing units of Scrap and Salvage Department.

Processing of scrap includes Flame cutting, Bailing, Bursting and Breaking including

salvation of sticker ingots and slag cups. These processes of preparation of scrap are

carried out in different shops depending upon the type, size and shape of the scrap.

The processing of scrap comprise of the following units:

(a) Flame Cutting Shop No.1 and 2. And bailing press.

(b) Skull Breaker Shop No.1 and 2.

(c) Bursting Yard.

Brief description of scrap processing Units:

(a) Flame Cutting and scrap Bailing unit, and Flame cutting Shop No.2

FCI shop is equipped with one Bailing Press and five overhead magnet cranes of

capacity 15 tones each. The shop stores Bailable material as well as manufactured bales.

It has space to process crap this lancing is at the eastern end of shop.

The bailing of scrap is done with all sorts of light scrap having thickness not more than 8

mm to get compact bales so as to charge these in L.D. Converter. This bundling section is

equipped with 1600 t balling press.

The materials used for bundling are shearing from HRCF/CRCFR, cut sheet from

HRM/CRM, fine from pit side of SMS, light metal structural like angles and channels

and other production and civil scrap having thickness up to 12 mm. In the shop there is

provision for magnet cranes of 15 t lifting capacity and 2 magnets grab cranes of 15+15T

capacity.

43

The capacity to Flame Cutting Shop No. 2 is 295,000T of scrap per year. The

preparation of scrap is done by the same methods as in flame Cutting Shop No. 1. The

hop is located in a one bay building of 30 meters width and 156 meters length. Two

through railway track is laid in the building for supplying and dispatch of the scrap there

is provision for 3 magnet cranes of 15T lifting capacity this shop is presently storing

materials ‘or external sale.

(b) Skull Braking Shop No. 1 and 2

Each skull breaker is designed for crushing of steel scrap and iron scrap. Skull breaker 1

is an open two storied crane gantry of 24 meters width and 96 meters length. The height

of the first storey of the gantry up to the head of the crane rail is 22 meters. The first

storey is common for the whole building and the second storey is erected at the end of the

section 48 meters long and is intended for crushing of the scrap of the skull breakers. All

along the columns of the building one railway tracks are laid for the supply and dispatch

of scrap shop is divided into two parts-one is the crushing pit and the other is storage area

with the capacity to store 7 days stock. Skull breaker 11 shops are also equipped with

balling (top) crane and bottom crane for handling materials. It is engaged for processing

of scrap for SMS.

The crane capacity of bally crane is 15 t and that of bottom crane 50T/75T in shop

1 and 11 respectively.

The skull breakers are meant for releasing mould and bottom stickers, releasing

slag cups from skulls and breaking heavy and medium skulls, ladle scrap, runner, scrap,

oversize and very often shapeless pieces of cast iron and steel scrap, rejected ingot

moulds, bottom plates, small mill rollers, machines ad machine stand and other cast

pieces. The size of the processed steel scrap should be 300 X 600 approx.

A steel ball of 10 t weight is lifted to a height of 20 To 22 meters with the help of a

crane and then released over the scrap for breaking it. The whole building is made of

hanging wooden sleeper so as to withstand the impact of splinters.

44

(c) Scrap Bursting Yard

The bursting Yard is provide with facilities for handling of 20,000 T scrap per year (2/3

steel scrap and 1/3 iron scrap). The unit is located upon one span crane gantry of 21

meters width and 41 meters length. One through track is provided for supply and dispatch

of scrap.

For scrap bursting the section is provided with reinforced pit lined with armored

plates. Bumming bursting the pit is covered with an armored cover. Blast holes in scrap

for loading of blasting charges are made by oxygen lancing. The unit is served by one

crane of 75/20T lifting capacity with a detachable magnet on the hook.

In this section releasing of stickers, and processing of rejected ingots, rolls, skull

and other heavy jams are done by means of explosives. Agencies engaged for processing,

dispatch of scrap. FSNL, govt. of India under taking of various type of iron and steel

scraps (external and internal).

TYPES OF PRODUCTS

In Bokaro Steel Plant, the finished products are categorized into three parts:

1. Prime Products: -

These are the actual products, which are originally produced for example, blooms, billets,

channels, rounds, angles etc.

2. By-Products: -

These products are not originally produced by Bokaro Steel Plant, but are outcomes while

producing the prime products.

3. Secondary Products: -

45

These are the defectives or rejected materials due to improper mixing of chemical

components or fail to meet the optimum requirements. Scraps generated inside plant are

also termed as Secondary products. The secondary products used here in after will mean

ferrous materials generated from various production units which can either suitably be

used for re-melting to produce iron and products or offered for sale if rendered surplus in

production process for example Defective Heavy blooms, Defective Rails, Rail cutting,

Rod cutting, Scrap etc.

Following Items fall under the category of Secondary Products:-

(A) REROLLABLE/IRON AND STEEL SCRAP/BFG SLAG

1. MS SLAB END CUTTING WITHOUT FISH TAIL

2. MS THICLE PLATE CUTTING (25-40 MM) MIXED W.FR.

3. SPILLED HOT METAL (10 MT AND BELOW) SMS ARISINGS.

4. LIQUID NITROGEN.

5. FINE IRON CHIPS FROM IMP (FE-70% APP).

6. FERROUS SIELPHATE – LOOSE.

7. BE GRNAULATED SLAJ (BOTH BY FIXED PRICE AND TENDER).

8. LIQUID ARGON.

9. PIG TRON.

10. TURNING & BORING.

(B) OTHERS

1. CARBIDE SLUDGE.

2. U/R AMC/MCB BRICKS.

3. U/R MAJ CHROME MAJ BRICKS.

(C) COAL CHEMICALS AND BY PRODUCT

46

1. MG BENZENE

2. NG TOLUENE

3. LS NAPTHA

4. SB OIL

5. HP NAPHTHALENE

6. ANTHRANCENE OIL

7. EXTRA HARD PITCH

8. HARD MEDIUM PITCH – SOLID STATE

9. HARD MEDIUM PITCH – LIQUID STATE

DETAILS OF SCRAP

There are various types of scrap, which is generated from the particular prime products.

Some brief summaries are given here: -

1. PCM SCRAP

This is a scrap generated in the pig-casting machine and consists of Splashing, PCM

runners and fires are in the fix range of up to 1.0 tones per piece.

2. BF RUNNER SCRAP

Generated in the blast furnace cast houses in the form of runner jams etc the maximum

fix per piece is up to 2 tones. This scrap contain amount of slag.

3. UNPROCESSED STEEL

Generated in the steel melting shops in slag cups and metal ladles.

4. SBIM SCRAP

This consists of semi broken ingot mould and bottom part as scrap and is in fix range up

to 2 tones per piece.

5. COBBLED SCRAP

47

The cobbled scrap arises from wire rod mill and includes some rejected coils and binding

wires also.

6. REJECTED ROLLS.

Cast iron rolls rejected steels rolls.

7. MILL CUTTINGNS

Rail and structural mill cuttings, merchant mill cuttings, rail cuttings, plate end sharing

rejected slabs, Slabs cuttings, miss rolled slabs, and wire rod cuttings are included in this

type of scrap.

COLLECTION OF SCRAP

1. All scraps identify the metallic scrap generated in the production, process and lying in

the shop. The shops collected the scrap with the help of overhead cranes and stock them

for loading into wagons.

2. Rejected rails and sleepers lying near the railways track inside the plant are collected at

such points from where loading and collection by truck is possible.

3. Crane facility is provided for loading the scrap into the truck whenever cutting or

processing not possible on the spot.

4. Scrap & Salvage department is responsible for overall coordination of scrap collection

from the entire plant. For this each shop nominate one executive for ensuring the

clearance of scrap from the shop.

5. Head of Marketing and customer service department requires the progress on scrap

collection on weekly basis.

6. Scrap & Salvage department makes suitable schedule for collection of scraps and

intimates the date of collection to respective shops.

48

NECESSITY OF SELLING THE ''SECONDARY PRODUCTS"

The net sales realization from all the Secondary products, By-Products and co-products

of BSL is around Rs.600 crores which is quite more than money the big industries. Out of

this Steel Scarp arising itself brings about Rs.15200 cores of money every year. Re-

production of main products from the; secondary products requires re-melting it again for

the required composition of the materials as per the desired specification.

By selling it to the different Mills/traders/Processors the plant earn around Rs.4000 per

tones of the direct profit than by re-producing it to the main product. The traders

/processors/re-rollers, use these as a raw materials for different finished products making

huge profits, the plant is also not losing anything.

Profit is the main aim of every business, and when the realization of these products for

the finished products proves to be costlier, the management plant decided to sell it to the

local market.

By selling secondary Products to the Local market new industries are developed for re-

rolling the Secondary materials to make finished products. It has also increased the small-

scale industries and employment opportunities.

Last year average price of scrap product were between Rs.12000/ton to Rs.16000/ton

49

Major customer of Secondary product

1. Ma Durga Ispat Udyog, Bokaro.

2. Bokaro Devlopement Area.

3. Kartike Ispat Pvt. Ltd, Kanpur.

4. Amit Steel Corporation, Howrah.

5. Diwan Steel, New Delhi.

6. Nenu Mal & sons, Kanpur.

7. Bhawani Metals, Bokaro.

8. Pandey Metals, Bokaro.

9. Chinar Steel Segment, Bokaro.

10. Mangal Pvt. Ltd., Bokaro.

11. United Iro Coporation, Dhanbad

12. Bharat Supply Company, Kolkatta

13. Anup Steels, Delhi

14. Hanuman & rise Pvt. Ltd, BIADA

15. Amit Metcum Pvt. Ltd.

16. Steel India, Dhanbad

17. Kunal Steel Coperation, Ludhiana

18. GD Goel & Company, Kokatta

19. Modern Indua concast Ltd, Kolkatta

20. Agarwal Steel Centre, New Delhi

21. Tribhole Udyog, Dhanbad

22. Shiva Chemicals SSE, Sindri

50

Average Price of different By-Product which BSL were sold in

April & May 09

Item 2007-2008 2008-2009 2009-2010

Hard Med Pitch Rs.16628 Rs.23331 ------

Ferrous Sulphate ------- ------- Rs.6000

Naphthalene Rs.47864 Rs.42793 Rs.42900

Anthracene oil Rs.13805 Rs.18511 Rs.13200

Benzene Rs.38354 Rs.30961 Rs.32900

Toluene Rs.39603 Rs.39080 Rs.35300

LS Naphtha Rs.32392 Rs.31029 Rs.31050

S Boil Rs.20533 Rs.19588 Rs.18000

Major Customer of By-Product

1. Shree Bhole Udyog, Bokaro

2. Jalan carbon & Chemical, Jamshedpur

3. Bajrang petro chemical, Kanpur

4. Shalimar Chemical industries Pvt. Ltd., West Bengal

5. Shiva Chemical, Bokaro

6. AGR Enterprise, Mumbai

7. Kutch Chemical Industries, Baroda

8. Bhilai Chemical Pvt. Ltd., Ranchi

9. Ganga Rasayan, West Bengal

10. Naresh Prasad Agarwal, Bokaro

11. Himadri Chemical & Industries, West Bengal

12. Eastern Tar Pvt. Ltd., Jamshedpur

13. Jalan Carbon, Jamshedpur

51

“ROLE OF MARKETING DEPARTMENT”

MARKETING DEPARTMENT OF

BOKARO STEEL PLANT

Marketing Department is one of the departments under Materials Management Division

of Bokaro Steel Plant. Marketing Department is entrusted with the responsibilities to sell

BSL’s Secondary Products, By-Products/Waste Products, and Idle Assets etc.

The Marketing Departments sales procedures are covered by the guidelines given by

SAIL Corporate office DELHI, and is given by CMMG (CORPORATE MATERIAL

MANAGEMENT GROUP), the objective of which is “To sell the materials in a fair and

transparent manner to achieve maximum possible revenue to the company” on the basis

of “as is where is basis”.

(a) Marketing of prime products of SAIL’s plant including BSL is done by CMO (Central

Marketing Organization) which is a unit of SAIL.

(b) Marketing of secondary products and coal chemicals are done directly by Marketing

Department of BSL. As a matter of fact, the Secondary & By-Products are marketed by

the individual Plants only.

Marketing of these products are conducted by various sections by marketing department

of Bokaro Steel plants. It is engaged, with marketing of Primary Products for home sale

or export through CMO. The 4.0 Million tones section known as plate mill section

dealing with plates.

The secondary section deals with the secondary Products, it includes scraps of iron and

steel slag, coal and coke fractions, coal chemicals.

52

The Marketing development section deals with the MIS and strategic Planning activity

come under this section.

The Export section deals with the activities of the exports in respect of Iron and Steel

items produced by Bokaro steel plant.

ORGANISTATION CHART OF MARKETING DEPARTMENT

(BSL)

53

GM (Marketing)GM (Marketing)

Jr. Mgr. (Co-ordn.)/Mktg. Cord, HK, Admn. & Est. Training Officer

Jr. Mgr. (Co-ordn.)/Mktg. Cord, HK, Admn. & Est. Training Officer

DGM (Mktg.)Audit, Vigilance, RTI, & other queries reply, Contract Cell(MM), Sec. Sales

DGM (Mktg.)Audit, Vigilance, RTI, & other queries reply, Contract Cell(MM), Sec. Sales

AGM(Mktg.)Sec. Steel Ad & Est, QC, ISO, DCA, Contract Cell(MM)

AGM(Mktg.)Sec. Steel Ad & Est, QC, ISO, DCA, Contract Cell(MM)

Sr. Mgr.(Mktg.)Slag, Waste, Iron, Smug. Scheme

Sr. Mgr.(Mktg.)Slag, Waste, Iron, Smug. Scheme

Sr. Mgr. (Mktg.)Idle Assets, U&S, Surplus

Sr. Mgr. (Mktg.)Idle Assets, U&S, Surplus

Sr. Mgr. (Mktg.)Coal& Chem., Zinc Dross, Ammonium Sulphate & Ferrous Sulphate

Sr. Mgr. (Mktg.)Coal& Chem., Zinc Dross, Ammonium Sulphate & Ferrous Sulphate

Manager (Mktg.)Reports, Price Monitoring, MIS

Manager (Mktg.)Reports, Price Monitoring, MIS

Jr. Mgr. (Mktg.)Secondary Steel, Safety Officer

Jr. Mgr. (Mktg.)Secondary Steel, Safety Officer

Jr. Mgr. (Mktg.) Jr. Mgr. (Mktg.)

FUNCTION OF MARKETING DEPARTMENT

1. To monitor the orders issued by CMO, So that these orders can fulfilled in time.

2. Put pressure on CMO, to get orders for an underutilized mill.

3. To sell all the secondary products directly i.e. directly by BSL and by CMO.

4. On day to day basis it takes care of the dispatches i.e. daily dispatch are checked.

POLICIES OF MARKETING

Marketing Planning has responsible function in the working of marketing department. All

the risky developments, taking out solution to cripple `situations, this section carries out

product pricing and related activities, some of the programmes, policies and procedures

are as follows:-

I) Positioning the product a value based place in customer mind.

II) Finalize annual sales plan and quantity, monthly, weekly, and daily rolling

programme of Rolling mills in consultation with CMO and mills. This plan is based

on the sales forecast receive from JPU SPL/ Iron and steel controller.

III) Optimizing the product-mix by proper utilization of available stocks.

IV) Receiving Enquiries and complaints, cancellation of orders etc.

V) Coordinating the works of mills and traffic department so as to maximize

dispatches.

VI) Periodical market surveys of products to analyze the market position.

VII) Implementation of suggestions received from the customers’ feedback.

VIII) Ensure customer satisfaction by meeting customers regularly; provide redress to

their problems and fulfillment of demand.

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Pricing policy and Sales Procedure:

PRICING:

Fixing the price of a product is the most vital function in the whole process of the

marketing and it should be done after proper market study and requires decision making

ability. If price is too low the company will lose revenue and if the price is too high it will

lose customers resulting in loss of revenue valuable customers. Coal chemicals are the

main product which is to be marketed by the Marketing Department of Bokaro Steel

Plant. Almost all the products are sold on the fixed price basis. This is due to the fact that

the company does not enjoy monopoly in the said market and the price is totally market

driven.

The policy adopted by the marketing department for pricing of materials is largely guided

by the price offered by the bidders during the auction. The various factors taken into

consideration while pricing the re-rollable items can be enumerated as follows: -

(a) Prices offered in the auction sales.

(b) Quantity of material to be lifted.

(c) Approval of Competent Authority.

The average of the prices offered by the bidder during auction is taken as the basis to fix

the prices of materials to be sold through marketing department. Further the techniques of

break-up-pricing are adopted i.e. the larger the quantity purchased lower will be the

prices. This technique encourages the buyers to purchase larger quantity. Finally the

competent authority approves the prices set by the pricing committee. On this basis, a

price list is prepared for all the potential buyers. Price list also indicates the sales tax and

Excise duty to be levied. Thus the interested parties place their orders with the marketing

department on the basis of price list reviewed every month. Every customer is required to

have a security deposit amount of Rs.1 lakh. The payment for the material required is to

55

be in advance. The material is supposed to be lifted on the specified date on account of

delay the party has to pay the difference in the prices, if there is any increase in

subsequent month.

Standing Pricing Committee:

The committee reviews the price of various products and takes decision in favor of

maximizing the profit. It holds meeting at least once in a month. But the volatility of the

market and pool of different products lead to a number of meeting of the committee in

quick succession.

The committee consists of:

GM (Utility), Chairman

GM (Marketing), Convener

DGM (Finance), member

DGM (Sales Coordination), member

DGM (Stores), member

DGM (BPP), member

For Scrap goods the DGM (SSD) replaces the DGM (BPP). Rests of all the members are

always present in all the meetings.

While deciding the price following points are kept in mind:

Dispatch and the prices of material is the previous auctions.

Material in stock.

Forecast of market condition.

General market condition.

GM (Marketing), as per the need, decides the frequency and time of meetings to be held.

Minutes of the meetings is prepared and it contains the existing price and the proposed

price. The final price is moved to the competent authority through the official channel

including GM (Marketing), Executive Director (MM), GM (Finance and Accounts).

After the competent authority’s approval the price becomes applicable and the circular

56

indicating the revised price is printed, issued and distribution to the customers and all the

concerned departments.

DISTRIBUTION

For the purpose of distribution of steel (distribution policy of marketing department)

policy, customers are categorized into A, B, C & D. Priority sector customer e.g.

Defense, Railways etc. are under category A and about 60% of the product allotted to

them. The balance 40% is kept for the category B, C & D.

On the other hand for sale of scraps there is no such policy adopted by Bokaro Steel

Plant. Customers are served on first come first served basis.

CHANNELS

Bokaro steel plant has zero level channels as it directly sells to the customers. There is no

intermediate among producer and consumer. Marketing Department always remains in

contact with the customers’ extracts information about the current market situation on the

basis of interaction between them.

MARKETING STRATEGIES OF BSL

Steel being an industrial commodity it is very necessary to maintain customer

relationship for profitability and smooth running of company.

1. Customer Satisfaction

BSL adopts following practices for customer satisfaction.

a. Procedure / process adapted to access current / future expectation of customers.

b. It induces market research visiting customer premises attending to customer

complaints.

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c. CMO has Market Management Group where specialists monitor changing demand

pattern and development in each Market segment is carried on.

d. It has posted market development officers at various locations that are its eyes and

ears for monitoring current and future expectation of its customer.

e. The Business-planning department is exclusively meant to study customer's changing

demand scenario and assess current and future expectation.

f. To understand customer needs seminars and workshops are also organized by BSL.

Building Customer Relationship

BSL has adopted the philosophy of recognizing segment of the market and identifying

key customer in segment and giving them preferential treatment. CMO sales executives

have been trained to use direct selling as tool for building long lasting relationship with

the customers. Easy access to customers to seek assistance makes proposals send

comments and compliments.

MARKET DEVELOPMENT

BSL has valued customers group in identifying their specific needs Specific to that group

thus segmenting and developing market segment for our products. Major product

modifications are done as per their specific needs of the Market segment thereby creating

product differentiation packages.

PRODUCTION ACCORDING TO MARKET NEEDS

BSL is always in touch in market and try to produce according to market needs. BSL tries

to produce quality products / new products which fulfill the need of market.

2. STOCK REDUCTION

Giving facilities like door delivery, road dispatches, credits facility and rounds the clock

stockyard operation.

3 PRICE FIXATION

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Pricing is done basically by the CMO. Taking into consideration cost of production,

government steps on pricing, certain percentage of profit, price of raw material fright

charges etc. i.e. pricing is COST PLUS PRICING.

4 DESPATICH

As the product is manufactured, this department directs the stockyards the mode of

transport to the destination with reference to dispatch program and dispatch advice is

mode.

5 DOCUMENTATION

With the dispatch of product the Finance department calculates the total cost of product

as per demand order. Certain receipts and bills quoting the material code, nature,

quantity, and all expenses are sent to connected stockyard. The product will be then

released to the concerned person after proper and complete payment to the pay-in-

authorities is made.

MARKETING OF SECONDARY PRODUCTS

During the seventies and sixties when the plant was one million-tones and 2.5 million-

tonnes capacity respectively, arising of secondary products was limited and such arising

was recycled for re-melting. Therefore there was no scope for marketing in other words it

was not economical. The plant capacity has been increased from 2.5 million tons to 4

million tones in the late sixties. New technology has been adopted while increasing the

capacity of the plant where by the use of arising for re-melting drastically reduced. This

has given more impact to the making of secondary product.

In the nineties we have seen lot of changes in the economic scenario of the country. The

concept of more employment in Public Sector Enterprises has changed to more profits.

59

There by the plant also has geared up its strategy towards this end. One of the strategies

adopted by the plant for increasing the profit is marketing of secondary products.

In the recent years a number of foundries and re-rolling Mills come into existence

throughout the country. These small scales Sector need the "Secondary products" as input

raw material for their production. The company has engaged in educating them the use of

secondary products for different kinds of end products for consumption of general public.

The plant extends all types of facilities and assistance to these small-scale units. This, in

turn gives scope for more employment opportunities.

The plant for marketing has adopted following strategy:

1. Committed delivery.

2. Competitive price

3. Quick complaint settlement.

4. Culture of customer service.

It is necessary to mentioned here that the companies' profit consists of 10% turnover of

secondary products for the Last two years.

PLANNING FOR SALE OF SECONDARY PRODUCT

1. Marketing Recovery Department (MRD) works out the quantum of different types of

scrap available for sale on monthly basis. This is determined by ascertaining the total

scrap stock at the beginning of the month. Scrap arising during consumption. The

remaining quantity is considered for sale. A, monthly report on availability of scrap is

prepared by MRD and sent to marketing department.

2. Marketing Department finalizes the plan for actual quantity of scrap to be sold in

consultation with MRD. Marketing department finalizes mode of sale, terms and

conditions for sale, locations and commercial aspects.

3. The pricing committee consist of Managing Directors fixes the price of each type of

scrap.

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4. Marketing department obtains MD's approval on price fixed by pricing committee.

PROCEDURE APPLIED FOR SALE OF SECONDARY PRODUCTS

1. After obtaining approval of quantity and price for sale, Marketing department

scrutinizes the demand from various parties, examine the Priorities and issue "offer

letters" to respective parties. The terms and conditions for sale are also enclosed with the

"offers Letter"

2. About one third of the quantity of material to be sold during the year is offered to the

actual users, subject to registration of demand.

3. For the balance quantity to be sold at prices fixed by pricing committee, preference is

given to actual users over traders. If there are no actual users, the material may be offered

to traders giving preference to registered traders over others.

4. First preference is given to the actual users for allotment of scrap against particular

category of users. Scrap processing units are given second preference for such

allotments.

5. The amount received from the party towards advance payment and security deposit is

forwarded to finance department by marketing department after recording the details in

the register.

6. Parties are allowed to visit the respective location disposals site, and inspect the scrap

offered for sale.

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7. Marketing department prepares sale order for the parties who have accepted the offer.

Sale orders are issued party wise and category wise i.e. individual sale order covers such

categories like C I scrap, steel scrap, re-rollable, slag and waste products.

8. Based on the deposit made by the party, finance department intimates to marketing

department about release of requisite scrap for supply.

THE STRUCTURE OF THE PROCESS OF SALES AND

MARKETING

62

PRODUCTS

PRIMARY (SPECIFIC PARAMETER) SECONDARY/BY-PRODUCTS

CMO (KOLKATA) UNITS- BSL, BSS, RSP, DSP etc

BSL MARKETING

METHOD OF SELLING

E-AUCTION SALE TENDER FIXED PRICE SALE

DEMAND REGISTRATION OF BSL

Marketing department of BSL sales homogeneous steel scrap at fixed price. For this

purpose the procedure for registration of demand and offers is as below:

1. Preference for sale of material given to local parties and those, which are actual

customer. Material is not sold for trade.

2. Sale of material made to re-rolling mills and scrap processing units and the lots of sale

between them maintained at 67:33.

3. Based on the above consideration “offer letter” issued to the party offering a quantity,

which has been lifted by them during the last preceding year or allocated by the state

industries, Department. In the offer letter party is advised to complete commercial

formalities e.g. submission of “Die Registration Certificate “etc.

Selling of Secondary & By-Product

This involves a direct marketing process. The management of BSL in consultation with

the official of the market development and customer service department work as group

for the sale of these items. Different modes of selling are used for these products

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BSL MARKETING (MAIN SECTION)

STEEL CHEMICAL & BYE-PRODUCTS

SLAGS & WASTE PRODUCTS

IDLE ASSETS PRICING

MODE OF SALE

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E-auction

E-auction

Fixed Price Sale

Fixed Price Sale

Inter Plant Transfer

Inter Plant Transfer

TenderTender

Procedure of E-Auction

Advertisement/posting of dates and types of materials to be auctioned in SAIL website

and various news papers (Local & National) every 15th to 20th of the month for the next

month,

1. Posting of details of lots to be auctioned one week prior to the date of auction, on

the website of SAIL and metal Junction.com

2. Inspection of lots to be auctioned by customers.

3. Auction is held on www. Metal Junction.com

4. Report of auction conducted is give by Metal Junction.com

5. Meeting of reserve price opening committee and their recommendation.

6. Approval for sale of lots recommended by RP opening committee.

7. Issue of offer to the customers, based on approval of chief Executives.

In this method the defective materials from all the mills is arranged in heaps of 100-150

tones to be sold by auction. Generally auction sale takes place ones in a month.

Representative from all the re-rolling mills turn up during auction and they bid for the

available material. The raw material need of this mill is being made by the plant and the

availability of the re-rollables has increased the re-rolling mill to develop very fast. The

plant extends all types of facilities and assistance to these small scale units, which to turn

give scope for more employment, and then the material is lifted on the terms and

conditions as mentioned in the tenders.

65

FLOW CHART OF E-AUCTION

66

Advertisement of dates/type of materials on SAIL website/Newspaper

Posting of lot details to be auctioned on SAIL /

MetalJunction website

Auction conducted on metaljunction.com

Inspection of lots by customers

Report of Auction by metaljunction.com

Reserve Price Opening Committee meeting

Recommendations Approval for Sale

DEFINITION OF KEY TERMS

 

Auction

Auction refers to a forum where the requirement for one/more lots of an item is

stated and the participants (bidders) are required to bid down the price to be selected to

supply the requirement.

Online Auctions

Online auctions refer to those auctions conducted through the Internet with the

bidders (from one or more locations) simultaneously bidding to be selected for supplying

the item/s on auction. In other words, the venue for the auction is on an Internet website/

platform. The "Service Provider's" website assigned by "Service Provider" would

constitute venue for the purpose of the online auction.

 Award at the Auction

  In a single winner format, only one bidder (normally the bidder who quotes the

highest price) is awarded all the units of the item being auctioned. The bidder quoting the

highest price is normally allotted the item.

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Issue of Offer Letter

Client

Client is the individual/business entity who has contracted "Service Provider" to

conduct such auction. In case of auction, the purpose would be the genuine intent to sell

the selected items/Lot to the bidders desiring to buy these items from the Client.

Bidder

Bidder is the individual/business entity participating in the auction, intending to

buy the items/Lots from the Client. To be become a Bidder in the auction, a business

entity has to secure client approval for participation and also provide written assent to the

General Rules and Regulations

Auction Engine

Auction Engine refers to the software that encapsulates the entire auction

environment, processing logic and information flows. "Service Provider" is the sole

owner of the auction engine and retains exclusive right over the utilization of the same.

 

Timings of the Online Bid

All the timings of the Online Bid shall be based on the time indicated by the Server

hosting the Auction Engine. It shall be the endeavor of "Service Provider" to ensure that

the Server Time reflects as closely as possible the Indian Standard Time (IST) i.e. GMT

+ 0530 hrs. However, in the event of any deviations between the Server Time and the

Indian Standard Time, the functioning of the Auction Engine

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(Launch, operation, and closure) would be guided by the Server Time. Bidders are

advised to refresh both the windows of the Auction Module check the exact Server Time

(displayed in both the windows).

Preview Time

Preview Time refers to the period of time that is provided prior to the commencement

of bidding. This is to facilitate approved participants to view the auction details such as

item specifications, bidding details and bidding rules. The purpose is also to familiarize

participants with the functionality and screens of the auction mechanism. It is not

mandatory for "Service Provider" to provide Preview Time.

Start Time

Start time refers to the time of commencement of the conduct of the online auction. It

signals the commencement of the Price Discovery process through competitive bidding.

Duration of the Auction

It refers to the length of time the price discovery process is allowed to continue by

accepting bids from competing bidders. The duration of the auction would normally be

for a pre-specified period of time. However, the bidding rules may state the conditions

when the pre-specified duration may be curtailed/ extended. The conditions include:

69

Shortening of auction duration in the event of no bids for a specified period of time

(Inactivity Time)

Automatic extension in the event of bids being entered towards the end of the scheduled

duration to facilitate the other bidders to view and react to the bid.

Auto Extension of the Auction Timings

In the event of bids in the last few minutes of the scheduled bid time, the Bid Timings are

automatically extended for a specified period from each such bid. Such Auto Extension

shall continue until no bids are placed for the specified period (Engine remains inactive

for the specified period). The Inactivity Time for Auto Extension purpose is normally X

minutes. "Service Provider" however retains the right to change the same. The Inactivity

Time applicable for the particular Online Bid shall be visible to the bidders under the

Bidding Rules module on the engine.

End of the Auction

End of the Auction refers to the termination of the auction proceedings signaling an end

to the price discovery process.

PROCEDURE OF SALE THROUGH FIXED PRICE

1. General Sale notice for different items to be sold is posted on SAIL website and

advertise in various newspapers (Local and National) between every 15 th to 20th of

the month for the next month,

2. For requisition of materials, applications are invited from customers bet 25 th -

30th/31st of every month.

70

3. Allocation of material to various customers is done as per approved procedure of

priority allocation.

4. Offer letters are issued to the customers.

5. Price applicable will be the price rising at the time of dispatch.

FLOW CHART OF FIXED PRICE

71

Advertisement of type of materials on SAIL website/Newspaper

Application from customers

Issue of offer letter

Allocation of material

PRIORITY IN BOOKING OF MATERIALS BY MARKETING

DEPTT

Category Priority Buyer Quantity to be

allotted

A 1st Govt. Units/PSUs & its

subsidiaries & joint ventures

of govt. units having more than

50% govt. share

Any quantity

required by them

B 2nd Dependent BIADA units with

MD/BIADA’S

recommendations &

MD/BSL’s approval.

Maximum 70% of

the balance

available quantity

after meeting the 1st

priority

C 3rd Consumers/Processes of

Jharkhand state

30% of balance

D 4th To all other customers Out of the balance

quantity of material

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left if any

TENDER DOCUMENT

TERMS & CONDITIONS

1) The parties desirous of purchasing the material have to quote for entire quantity of the

material.

2) The Tenderers are advised to inspect the material at B.F. Slag Dump, if so desired,

before submitting the quotations.

Parties will be permitted to see the materials from 9.30 Hrs to 4.30 Hrs daily on working

days. Necessary entry passes may be obtained from the Receptionist/ CISF

3) Terms of sale: On “As is where is basis ", " No complaint basis “and” Ex-works basis"

No PICK and CHOOSE shall be allowed other than sorting out Iron/Steel pieces found, if

any.

4) The conditional quotations are liable to be rejected.

5) EARNEST MONEY

EMD (Earnest Money Deposit) Rs.100000/- for the item to be deposited in the form of

DD/BC/PAY ORDER in favors of SAIL/Bokaro Steel Plant, payable at Bokaro, from any

73

Nationalized / Scheduled banks along with the quotations. Any variation / demand in

such taxes, duties, levies, and charges and / or any fresh imposition of such taxes, duties,

levies and charges shall also be to the account of the bidder to whom the tender is

awarded.

The tenders should quote their rate in per cubic meter against the total quantity as asked

for in the tender document both in words and figures.

In case of any mismatch / ambiguity between the two the higher of the two rates only

shall be considered.

The tender should be submitted in the TENDER BOX placed inside the CONFERENCE

HALL OF MARKETING AND STRATEGIC PLANNING DEPARTMENT on the 5th

floor of ISPAT BHAWAN. The general terms and conditions of lifting by road and

safety stipulations in force shall be applicable.

6) PAYMENT TERMS:

The successful bidder has to make payment for the quoted quantity in 12 (twelve) equal

installments of 1000 CU. each. 1st installment is to be deposited within 10 (Ten) days

from date of issue of sale order inclusive of the date of issue of sale order. Subsequent

installments are to be deposited within 30 (Thirty), 50 (Fifty), 70 (Seventy), 90 (Ninety),

110 (One hundred ten), 130 (One hundred thirty), 150 (One hundred fifty), 170 (One

Hundred seventy), 190 (One hundred Ninety), 210 (Two Hundred ten) & 230 (Two

Hundred Thirty) days from the date of issue of sale order (inclusive of the date of issue of

sale order). However, lifting of entire quantity of material has to be completed within the

validity period of 300 (Three Hundred) days from the date of issue of sale order

(inclusive of the date of issue of sale order). Payments shall be in the form of DD/BC/Pay

order or acknowledgement note from SBI, IFB commercial, Branch of Raipur /Bokaro

payable at Bokaro from any of the Nationalized / Scheduled banks in favor of SAIL

/Bokaro Steel Plant. In case of failure of payment as mentioned above and or failure in

lifting of material within the validity period of lifting, the Management reserves the right

to cancel the sale Order and forfeit the security deposit.

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7) LOADING AND TRANSPORTATION:

Loading and transportation of the material in the tenderer vehicle has also to be done by

the tenderer at their own cost and arrangements.

Successful customer will be allowed to lift the material only 4 days in a week.

8) Bokaro Steel Plant reserves the right to accept or reject any of the tenders or all the

tenders or award contract to any other customer fully or partially without assigning any

reason.

9) The management reserves the rights to divide the quantity offered for sale and allot the

material to more than one tenderer.

10) VALIDITY OF LIFTING:

The successful tenders have to complete the lifting of the allocated quantity of material

within 300 (Three hundred) days from the date of issue of sale order.

11) The offer of the customer would remain valid for a period of 90 (Ninety) days from

the date of opening.

12) Loading will be done under the supervision of MRD, the operating agency of the

contract.

13) Evaluation criteria are the highest price for whole quantity (12000 Cu.) subject to the

price being acceptable to the management of Bokaro Steel Plant.

14) The standard Arbitration Clause of BSL as per the Arbitration and Conciliation act

1996 would be applicable.

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DATA ANALYSIS

SALES OF SECONDARY STEEL (Value in Lacks)

PERIOD 2007-08 2008-091st Qtr 11464 130222nd Qtr 13179 165643rd Qtr 13425 116024th Qtr 15194 9159

76

SALES OF IRON & SCRAP (Value in Lacks)

PERIOD 2007-08 2008-09

1st Qtr 958 1326

77

2nd Qtr 1115 1039

3rd Qtr 1014 1103

4th Qtr 1472 915

SALES BFG SLAG (Value in Lacks)

78

SALES PIG IRON (Value in Lacks)

79

PERIOD 2007-08 2008-09

1st Qtr 797 840

2nd Qtr 933 914

3rd Qtr 953 882

4th Qtr 940 998

PERIOD 2007-08 2008-09

1st Qtr 1436 0

2nd Qtr 854 458

3rd Qtr 0 175

4th Qtr 0 603

SALES BY-PRODUCTS (Value in Lacks)

 PERIOD 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09

80

1ST Qtr 904 1218 1041 1263 1759 2906

2ND Qtr 1320 1731 1417 1458 2047 2797

3RD Qtr 1145 1038 1312 1295 2104 2041

4TH Qtr 2024 1797 2045 2115 1918 1701

TOTAL 5393 5784 5815 6131 7828 9445

SALES MISC OTHERS (Value in Lacks)

PERIOD 2007-08 2008-09

81

1st Qtr 961 1457

2nd Qtr 848 1515

3rd Qtr 987 1065

4th Qtr 1182 462

E-AUCTION (Value in Lacks)

PERIOD 2007-08 2008-09

82

1st Qtr 8144 13410

2nd Qtr 12100 10800

3rd Qtr 9146 11223

4th Qtr 12619 6553

PRODUCTION PERFORMANCE OF BSL

07-08 08-09(MARCH)

TARGET ACTUAL TARGET ACTUAL

HOT METAL 4585 4660 5050 4020

CRUDE STEEL 4360 4130 4700 3577

SALEABLECR-COIL

3655 3600 4210 6479

SALEABLE STEEL 3780 3900 4110 3383

PROFIT IN BSL

YEAR PROFIT (Rs. IN CRORE)

2005-06 2056

83

2006-07 2737

2007-08 2830

2008-09 1324

SWOT ANALYSIS

STRENGTH-:

1. Bokaro Steel Plant has a huge pool of skilled and experienced personnel.

2. Principle of hierarchy is given due respect in BSP enabling management to

ensure proper planning and its implementation.

3. Flawless corporate image of SAIL enhances the confidence of managers and

customers alike.

4. Record of harmonious customer relation boosts the revenue graph towards north.

5. Strategic Information System in the organization gives cutting edge advantage

reducing cost and time for every operation.

6. Huge infrastructure, when provides a strong base for better production and

marketing, since it has countrywide network of stockyards, dockyard and sales

branch offices.

7. The by-product of Bokaro Steel Plant is coal-based and of best quality against the

petroleum based bye-products, giving the company a huge advantage against their

competitors.

8. Bokaro Steel Plant has TQP i.e. Total Quality People which mean a dedicated

work force towards serving the company’s customers.

9. A strong R&D cell of the company keeps on working over enriching the quality

of its bye-products and to reduce the cost of the whole process.

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WEAKNESS:-

1. Lack of teamwork and internal customer orientation inhibits proper

implementation of company’s policy.

2. Complex pre post sale activities repel the probable customers.

3. Due to its large organizational structure involving numerous policies and

officials, prompt decision making is a real problem.

4. The hard working marketing officials are not given due recognition and

appropriate reward that hurts their motivation and interest.

OPPORTUNITY:-

1. There is growing demand for secondary and by-products in both domestic and

international market.

2. State government is planning to establish small industries in and around Bokaro

which will increase the list of probable customers.

3. New markets are to be searched and developed with the opening of the global

steel market.

4. There is a great opportunity in the field of research to improve the quality of the

coal-based products which would strengthen its well established base among

customers.

THREAT:-

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1. The biggest threat for any company is competition, SAIL, BSL is also no

exceptional. So due to globalization the company is facing stiff competition from

global companies in all product segments as well as facing competition from

domestic players.

FINDINGS

RELATED TO MARKETING DEPARTMENT

During our eight weeks training in marketing department of BSL. We have observed

certain problems in it these problems are findings of our studies.

1. All marketing procedure of prime products are decided by SAIL and carried out by the

Central Marketing Organization (CMO).

2. As the organization is concerned with a large number of productions activities and the

departmental work are done mostly manually from placement of orders to documentation,

which ultimately frustrates the employees.

3. The organization is more concerned with larger orders of steel products by ignoring

the smaller orders.

4. The local customers with business of by-products are sometimes made to wait for days

to get their papers cleared by the department.

5. Most of the existing yards suffers from improper stocking space and siding facility

often they are not well developed due to this the material stored there are rusted and other

defects are caused and later they are disposed of by offering some concession or at low

rate which result in loss.

6. Due to improper packing, the materials reach the stockyard often in damaged

condition, which is attracting criticism from the customers and these damaged materials

are sold with loss.

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7. Export considered Secondary to domestic selling as BSL is a govt. Undertaking and its

First priority is given to domestic marketing.

RELATED TO SECONDARY SECTION

1. Payment is accepted from the customers even when the material is not available in

stock, in anticipation that the material will be made available shortly in the stockyard.

2. Unavailability of material in the stockyard leads to holding up of the huge investment

of the customers i.e. material cannot be purchased from the alternative source.

3. Refund of excess payment takes long time sometimes more than a year.

4. Price list made available to the re-rollers every month contains even the price of

materials, which is not available.

5. The price prevailing in the market of the finished goods manufactured by the re-rollers

are sometimes less as compared to the material purchased from BSL which results in

heavy losses.

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SUGGESTIONS & RECOMMENDATIONS:

1. E-payment should be implemented for complete automation of the e-auction

process.

2. E-invoicing should be adopted for saving money by replacing paper based

processes.

3. Concept of Key Account Manager should be adopted for better customer

satisfaction of regular customers.

4. Extensive customer contact.

5. The pricing as we well as the distribution policies should be framed by keeping in

mind the requirements of the complete range of manufactures and not only the bulk

consumers. This will encourage the new re-rolling mills to approach BSL for the

material.

6. Price of the material for which 100% payment has been received as advance should

not be changed if the delay in the lifting of the material by the party is due to some

fault of BSL but if is due to deliberate delay in lifting the material by the

customer than the same policy should be applicable.

7. When the customer having rolling mill of a smaller size purchase material, which

are rolled in a bigger rolling mills than this, clearly indicates that the material is

being purchase for trading. This practice can be prevented if BSL obtains a copy of

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certificates issued to the owner of every mill by the District industry center

specifying the size of the mill.

8. BSL can appoint 2-3 authorized stockiest also to avoid trading practice. In this way

the benefit of break up pricing can be passed on to the one for whom these have

been framed i.e. the actual re-rollers.

9. Price list made available to the various re-rollers every month by BSL should count

all the items but it should clearly indicate the material which is not available so that

the customers requiring that particular material can approach some other source.

10. The infrastructure facilities at the disposal yard should be maintained properly and

needs improvements so that the pace of the lifting process is increased.

11. Fully equipped computers system in marketing department.

12. Proper packing is to be done to safeguard the materials from damage, which is

occurring due to multistage handling and transportation.

13. Refund of excess payment process should be improved and simplified. It. should

make payment in less time. Ensure delivery of the material for which the payment

is accepted so that mills are not closed or shut down for want of material.

14. Alternatively if the material is not available the BSL authorities should not accept

the payment so that the buyer can approach some other source for procuring the

material and should not unnecessarily wait for the material, which is not available.

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CONCLUSION

1. BSL marketing network is spread all over India, which helps in collecting,

orders of various customers easily and it can easily interact with its

customers.

2. BSL officers posted outside like Kolkata, Delhi, Chennai and Mumbai who

work in close coordination with the Marketing Department.

3. Sales of Secondary Product have reduced compared to previous year.

4. Sales of Iron & Scrap are also reduced compare to previous year.

5. Sales of Blast Furnace Slag are almost same as last year.

6. Sales of Pig Iron are less in this financial year. Last year sales of Pig Iron

was nil in the 3rd and 4th qtr but in this year it has shown good market which

is good sign.

7. Market of By-Product shown good sign in this financial year and sales of

By-Product has increased compare to previous year. The price of By-Product

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has reduced in this financial year.

8. BSL has fail to achieve the target which they set for them and unable to meet

production of Hot Metal, Crude Steel, Saleable CR coils and Saleable Steel

of the target, its result has seen on the profit of the company which reduced

by 50% compare to last financial year.

ABBREVIATION

1. SAIL - Steel Authority of India Limited.

2. TISCO - TATA Iron and Steel Company.

3. MECON - Metrological & Engineering consultants’

ltd.

4. HSCL - Hindustan steel works consultants Ltd.

5. NMDC - National Mining Development Corporation

ltd.

6. RDCIS - Research and Development Centre for Iron

and Steel.

7. CET - Centre of Engineering and Technology.

8. CPTI - Central Power Training Institute.

9. MRD - Marketing Recovery Department.

10.BFGS - Blast Furnace Granulated Slag.

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BIBLIOGRAPHY

Magazine published by SAIL

Training Manual

Government Publications

Books of organization

Company’s Website

www.sail.co.in

www.metaljunction.com

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