Inventory MGMT in Coromandal

INTRODUCTION
Finance is one of the basic foundations of all kinds of economic activities. Financial
management is an integral part of overall management it is not a totally independent area
It concerned with the acquisition ,financing & management of assets with some overall goal
mind .Financial Management is important because it has an impact on all f the activities of
financial management.
Financial management is mainly concerned with the proper mgt of finance

function .Risk ,Cost and control considerations are properly balanced in a given
situation and there is optimum utilization of funds .F.M emerged as a distinct field of study at
the turn 20th century .Financial management as an integral part of overall management is
not a totally independent area .It draws heavily on related disciplines and field of study
,such as economics ,accounting ,marketing ,production and quantitative methods. It helps in
profit planning , capital spending ,measuring costs , controlling inventories ,accounts
receivable etc. It is essentially helps in optimizing the output from a given input of funds.
Concept of inventory:
Inventories constitute the most significant part of current assets of a large majority of
companies in India .On an average ,inventories approximately 60 percent of current assets in
public limited companies in India ,because of the large size inventories maintained by firms ;a
considerable amount of funds is required to be committed to them .It is, therefore, absolutely
imperative to manage inventories efficiently and effectively in order to avoid
unnecessary investment ,A firm neglecting The management of inventories will be
jeopardizing its long run profitability and may fail ultimately .
Levels of inventories:
Inventories are stock of the product a company is manufacturing for sale and
components that make up the product. The various forms in which inventories exist in a
manufacturing company are: raw materials, work-in-process avoid finished goods.
 Raw materials are those basic inputs that are converted into finished product through the
manufacturing process. Raw materials inventories are those units which have been purchased
and stored for future productions
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 .Work-in-process inventories are semi-manufactured products. They represent products that
need more work before they become finished product for sale.
 Finished goods inventories are those completely manufactured products which are ready for
sale. Stocks of raw material and work-in-process facilitate production, while stock of finished
goods is required for smooth marketing operations. Thus, inventories serve as a link between
the production and consumption of goods
The levels of three kinds of inventories for a firm depend on the nature of its
business .A manufacturing firm will have substantially high levels of all three kinds of
inventories, while a retail or wholesale firm will have a very high level of finished goods
inventories and no raw material and work-in- process inventories. Within manufacturing
firms, there will be differences. Large heavy engineering companies produce long
production cycle products, therefore they carry large inventories
Financial Management Levels:
Broadly speaking, the process of financial management takes place at two

levels. At the individual level, financial management involves tailoring expenses according to
the financial resources of an individual. Individuals with surplus cash or access to funding
invest their money to make up for the impact of taxation and inflation. Else, they spend it on
discretionary items. They need to be able to take the financial decisions that are intended to
benefit them in the long run and help them achieve their financial goals.
Financial planning seeks to quantify various financial resources available and plan
the size and timing of expenditures. Financial control refers to monitoring cash flow. Inflow
is the amount of money coming into a particular company, while outflow is a record of the
expenditure being made by the company. Managing this movement of funds in relation to the
budget is essential for a business.
At the corporate level, the main aim of the process of managing finances is to achieve
the various goals a company sets at a given point of time. Businesses also seek to generate
substantial amounts of profits, following a particular set of financial processes.
Financial managers aim to boost the levels of resources at their disposal.

Besides, they control the functioning on money put in by external investors. Providing
investors with sufficient amount of returns on their investments is one of the goals that every
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company tries to achieve. Efficient financial management ensures that this becomes possible.
Financial management is broadly concerned with the acquisition and use of funds by a
business firm. The important tasks of financial management are as follows:
A) Financial Analysis, Planning and Control
 Analysis of financial condition and performance
 Profit planning
 Financial Forecasting
 Financial Control
B) Financing
 Identification of sources of finance and determination of financing mix.
 Cultivating sources of funds and raising funds
 Disposition of profits between dividends and retained Earnings.
C) Investing
 Management of current Assets
 Capital Budgeting
Importance of Financial Management

Finance is the lifeblood and nerve center of a business, which is very essential to
smooth running of it. Right from the beginning i.e., conceiving an idea to do business,
finance is needed to promote or establish the business, acquire the fixed assets for
expansion of the existing one.
Some important functions of Financial Management
 Financial planning and successful promotion of an enterprise.

 Acquisition of funds as and when required at the minimum possible cost.
 Proper use and allocation decisions.
 Improving the profitability through financial control.
 Increasing the wealth of the investor and the nation
 Promoting the mobilizing individual and corporate saving.
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Financial System:
The purpose of financial management is to help the decision makers to make the better
financial decisions. These decisions are made in the context of a financial system that both
constrains and facilitates them. The financial system comprises a variety of intermediaries,
markets and instruments that are related in a complex manner .It provide the principal means
by which savings are transformed in to investments. Given its role in the allocation of
resources, the efficient functioning of the financial system is critical to a modern economy.
Functions of the Financial System:

The financial system performs the following interrelated functions that are essential to
modern economy:
 It provides a payment system for the exchange of goods and services.
 It enables the pooling of funds for undertaking large-scale enterprises.
 It provides a mechanism for spatial and temporal transfer of resources.
 It provides a way for managing uncertainty and controlling Risk.
 It generates information that helps in coordinating
 Decentralized decision making.
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Need for the Study
The Industry sectors and the financial system are undergoing rapidly changes
following the process of liberalization and reforms. The underlying principle behind every
reform measure re-orientation of monetary policy techniques, introduction of new money
market instruments and institutions, suggest structural changes in the financial system and
strengthening regulatory arrangements has been to make the system more competitive,
efficient and profitable.
Every performance indicator seems to reflect the impact of the reform measures.
Profitability of the industry has witnessed a steady improvement mainly as a result of these
measures, Capital adequacy ratios have crossed the norms prescribed for almost all industries.
The industries have begun to focus on minimizing their asset liability mismatches and on
risk management. Further, after the enactment of securitization Act
2002, the industries get a weapon to tackle the challenge of Non Performing Assets (NPAs).
At this backdrop, it is felt essential to study the financial performance of the Lead Acid
Division, HBL Power Systems Ltd, which is one of the representatives of the industrial
system. This is experiencing the recent reforms.
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Scope of the study :
Entails planning for the future of a person or a business enterprise to ensure a

positive cash flow. It includes the administration and maintenance of financial assets.
Besides, financial management covers the process of identifying and managing risks.
The primary concern of financial management is the assessment rather than the
techniques of financial quantification.
A financial manager looks at the available data to judge the performance of

enterprises. Managerial finance is an interdisciplinary approach that borrows from both
managerial accounting and corporate finance. Some experts refer to financial
management as the science of money management. The primary usage of this term is in
the world of financing business activities. However, financial management is important
at all levels of human existence because every entity needs to look after its finances.
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Objectives of the Study
The following are the objectives of the present study titled “Inventory Management at
COROMANDEL INTERNATIONAL Ltd, Visakhapatnam”.
 To understand the concept of inventory management in general and to know

about the methods of inventory management in particular.
 To know the profile of Coromandel International Ltd located at

Visakhapatnam District.
 To learn the CIL is organizing its inventory management methods and

techniques.
 To give suggestions if necessary for the better improvement of inventory

management at CIL.
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Methodology of the study :
To fulfill the objectives mentioned above, the present study requires both
primary and secondary data. The primary data and the collection of secondary data
details are given as follows:
1 Primary data.
2 Secondary data.
Primary Data
It consists of information disclosed by the financial heads of various authorities

of the respective Departments of CIL. Conducting personal interviews with the
concerned officers of financial department at CIL.
Secondary data:
It consists of information obtained from annual reports. Balance-sheet and other

financial statements are also collected. Files and some other important documents
maintained by the organization. In addition to that, collecting data from referred text
books. Collection of required data from annual records of CIL had become necessary.
Reference from textbooks and journals relating to financial management are also
included.
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Limitations of the Study:
The study has been conducted is a systematic and comprehensive way so as to make the
project work an enviable one. However the topic under my study not is free from
limitations due to these factors. The following are the limitations of the present study:
1. Due to the time constraints it is difficult to study the performance of a big

organization of the size Lead Acid Division, At CIL.
2. The main source of information is the published annual reports which are not
sufficient to make a proper study.
3. The figures in the balance sheet are furnished according to the guidelines issued
by the Reserve Industry of India from time to time. Thus the Study Looses its
significance as the figures over the period may not be comparable.
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INDUSTRY PROFILE
A) FERTILIZER INDUSTRY AT NATIONAL LEVEL
Fertilizers are of immense value to man. They help the growth of agriculture
production. India is primarily an agricultural or an agro based country. Hence, it provides
an immense role in providing support to millions of people of the country.
The use of fertilizers enables the plant to increase the crop production by absorbing
greater amount of nutrients present in the soil. Hence, the fertilizers sector is one of the vital
sectors in the economy of the country.
Of late, a large number of private and public sector fertilizer plants have come up in
the country. These plants engage themselves in the production of several simple and complex
fertilizers such as urea, ammonium, phosphate and other complex nitrogenous and phosphate
fertilizers, which play a strategic role in catering to the needs of the various sectors of the
society.
Indian economy is presently an under developed economy. Almost all important

characteristic features of an under developed economy were present in the Indian economy at
the time of Independence and have not much changed since then. In the under developed
economy not only the per capita income is low but also the capital per head is very little.
Due to wide spread poverty, most of them have virtually no abilities to save and whatever
capital accumulation is done, it remains highly concentrate in the hands of people whose
value are not conducive to investment in industry or agriculture, more people spend
major portion of their income on food and necessities, and the food grains remain the
principle wage.
India has made substantial development in agriculture since independence in terms of

growth in output, yield and areas under many crops. It has gone through a green revolution, a
white revolution, a yellow revolution and a blue revolution.
Today, India is the largest producer of milk, fruits, cashew nuts, coconuts and tea in
the world. The second largest producer of wheat, vegetables, sugar and fish and the third
largest producer of tobacco and rice. The per capita availability of food grains has risen
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in the country from 350 grams in 1951 to about 500 grams per day now despite the increase
in population from 350 millions to 1250 millions.
Some of the major fertilizers making companies are Nagarjuna Fertilizers and
chemicals Ltd., Coromondel Fertilizers Ltd., are the major Phosphoric plants in the country.
In fact, all the other fertilizer Nagarjuna Fertilizers and Chemicals Ltd., Coromandel
Fertilizers Ltd., are the major Phosphoric plants in the country. In fact, all the other fertilizer
plants in the country are either nitrogenous or Potash based.
GROWTH IN FOOD GRAIN PRODUCTION
The food grain production in India in 1950 rose because of expansion in area. In 1960,
growth rate was very poor which resulted in large-scale imports. The development,
production and use of better seeds increased the productivity of wheat In 1970 and rice in
1980. The eighties was also a period of green revolution, which enabled India to become self
sufficient in food grain production and even a marginal exporter. In the nineties, however the
annual growth rate in production has fallen to 1.66% from 3.54 % recorded in the Eighties.
This is matter of serious concern for the country as this growth rate is just matching to
annual growth rate of population and 26.10 % of the population in the country is still living
below the poverty line.
MEANING AND ESSENTIAL ELEMENTS:
Fertilizer is defined as “any material, organic or inorganic, natural or synthetic,

which supplies one or more of the chemical elements required for the plant growth, A
fertilizer containing two or more nutrients and during the productions of which, chemical
reaction takes place is called “Compound or Complex Fertilizer”. Primary nutrients Nitrogen
(N), Phosphorus (P 2O5) and Potash (K2O) are normally supplied through chemical fertilizers.
FERTILIZERS-CLASSIFICATION:
Fertilizers may be classified into: (a)
Natural Fertilizers
(b) Artificial Fertilizers
Natural fertilizer is nothing but "Compost and manure". The action of soil bacteria
in breaking down dead organism and dung of animals· into nitrogenous compound easily
available by very good source of 'Natural Fertilizer'. When large areas of land brought
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under cultivation and natural fertilizer are inadequate to compensate the soil of its rapid
decreasing nutrient values, artificial Fertilizers have to be added to the soil.
NEED TO PRODUCE MORE FERTILIZERS IN INDIA:
The three types of nutrients are required for proper growth N,P, and K. however,
Indian soil is not very seriously deficient in Potassium. It is estimated that India at
present needs a minimum of 6,00,000 tones of nitrogen per year, 23,40,000 tones of P205
per year, 13,10,000 tones of K 20 per year. The present production capacity is only about
50% of our requirements and the remaining is being imported from other countries.
With increased consumption, it is obvious that India must greatly increase the
production capacity of Fertilizers.
FACTORS AFFECTING FERTILIZER CONSUMPTION:

Some of factors affecting Fertilizer consumption are:-
 Weather
 Adequate moisture - through irrigation and assured rains
 Location imbalance ready and timely availability of Fertilizers
 Credit availability
 Seasonality of consumption
 Inadequate movement facilities
 Other cost economies
HISTORY OF INDIAN FERTILIZER INDUSTRY:
The first fertilizer factory in India was established at Ranipath, Tamil Nadu by
EID Parry Ltd., in 1906 to produce super phosphate from the acidulation of crushed
bones with an annual capacity of 6,400 tons. This was followed by Dharma Maorajrji
Chemical Company Factory at Ambernath in Maharastra in 1924 and DCM at Delhi in
1964, both produced any Super Phosphate. The first production of nitrogenous
fertilizers viz., Ammonium Sulphate was in 1993 as a by-product in the Tata Iron and
Steel Company at Jamshedpur. This was followed in 1941 by production of small
qualities of Ammonium Sulphate at Belagula, Mysore.
The acute shortage of food immediately after the Second World War necessitated
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a fresh look at the ways of increasing production of food grains in the country. In this
process, the needs for fertilizers as an essential input for increased yields were realized.
As a result the Government of India started a fertilizer plant in Sindri. India was the
fourth larges producer of Nitrogenous fertilizers in the world. It was ranked 8th in the
phosphate fertilizers.
ROLE OF FERTILIZERS IN AGRICULTURS WITH REFERENCE TO INDIAN

AGRICULTURE:
Agriculture is a very vital sector of India’s economy. It accounts for 32% of

the countries GDP, provides employment to 65% of the work force and earns 27% of the
India’s foreign exchange. Growth of agriculture is an indicator of health of the overall
economy. The most important factor that contributes to the growth of agriculture is the
use of fertilizers. The following point highlights the needs for fertilizers.
The development of fertilizer industry in India has been synonymous with rapidly
growing agriculture. About 50% of the increase in crop productivity in recent times
can be credited to the use of fertilizers.
India has different kinds of soils and agro-climatic regions. Centuries of

cropping and inadequate manure have left the Indian soil largely depleted of plant
nutrients.
To advise and educate the farmers about the use of fertilizers and ensure the supply of
qualitative products, a number of soil testing laboratories have been set up. These helped
the farmers in judicious use of fertilizers.
The consumption of fertilizers is directly related to the availability of subsoil and

surface water for irrigation and on the vagaries of the weather.
The consumption of fertilizers is not evenly distributed. The imbalance has to be

removed to bring about the optimum usage of fertilizers. The India economic growth
largely depends on agriculture. Health of the fertilizer indicates the trend of economic
upturn and/or recession.
Earlier, the government used to fix the selling prices of fertilizers providing for
distributor’s margins, in 1977, the Government introduced a retention price scheme
for nitrogenous fertilizers, which was lager extended to other fertilizers.
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To make adequate quality of fertilizers available to farmers in time, Government
also gave a freight subsidy, which covered the movement of fertilizers to the block head
quarters.Due to ample mishandling political interference, Government gave up all those
plans and gave permissions for decontrol of Phosphate and Potassium fertilizers to the
block headquarters.
PRESENT TRENDS:
During the 8th plant in 1992-98, production came very close to 100% capacity
utilization in spite of the problems of sickness and raw material constraints. There would
have been no shortfall in production during the 8 th plan but for the failure of planned
capacity addition of seven lakh tones for nitrogen and 2 lakh tones for phosphate
due to feed stock supply constraints (natural gas)
In case of phosphate fertilizer which depends wholly on imported raw material

only a small capacity addition was included in the 8th plan with the adoption of pipe-
reactor technology in the existing plans to enable them to achieve a production
increase of 25-30%. This did not help the units because of the policy changes in 1992
resulting in decontrol of phosphate fertilizers.
The major objective of 9th plant (1997-2002) strategy is to frame long term
feed stock and price policies for fertilizers and the steady tapering off of subsidies. It
also aims to encourage inflow of fresh investments and bring about an increase in
fertilizer consumption. To realize optimum application, the large price disparity
between the different nutrients to rely optimum applications will also have to be
corrected. Infrastructure will have to be strengthened to ensure smooth rail movement of
fertilizers and port handling of imported nutrients.
The lack of coherent fertilizer policy made difficult by the political uncertainties
created by coalition compulsion at the Centre, is telling on the health of this vital
industry, through production wise it has a better year in 1997-98 than in the previous
year. This underlined the need for the comprehensive fertilizer policy. As a response to
this, a high power committee recommended scrapping of unit wise retention price cum
subsidies scheme for both urea and complex fertilizers to facilitate balanced application
by farmers. The pricing methodology was based on long-range marginal cost principle to
enhance production efficiency. This pricing formula was also proposed to increase new
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investments and efficient use of feedstock.
Fertilizer Association of India welcomed the suggestions to bring the price

DAP and other complex fertilizers in line with the selling price or urea to minimize in
balance in price ration and promote balance fertilizer use. Having become the 3 rd largest
producer, India’s production of plant nutrients during 1997-98 registered growth of 17
and 16 percent. The major factor responsible for improve production was the
improvement in the feedstock supply position.
With 83.9% self sufficient in fertilizers at present and with establishment of new
plans and expansion of existing once it should not be difficult to meet the projected
demand 16.6% by the end of 9th plan with less and less imports.
FERTILIZER MOVEMENT CONTROL ORDER, 1973
This was promulgated under Sec-3 or ECA to ensure equitable distribution of

fertilizers in different parts of the country, movement of fertilizers from one state to
another is possible when authorized by Central or State Government.\
FERTILIZER CONTROL ORDER, 1985(FCO)
With a view to ensure that the quality of fertilizers is checked at

manufacturing stage, statutory provisions have been made in the FCO that each
manufacturer has certain minimum testing facilities in their factory. The production
of standard quality of fertilizers alone does not ensure but the fertilizers are
delivered in the same chemical and physical condition duly protecting the nutrient
contents. Most of fertilizers being hygroscope in nature, their quality gets deteriorated if
they are not properly packed, stored and distributed.
STANDARD OF WEIGHTS & MEASURES (PACKED COMMODITIES) RULES,

1977
Under Section -83 of the Act, every package shall bear thereon a label
securely affixed. A definite plan and conspicuous declaration made in accordance
with the provisions of the chapter in respect of name, address, net quantity, month and
year of manufacture, common or genetic name of the commodity unit sale price etc.
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SUBSIDIES TO FERTILIZERS INDUSTRIES IN INDIA:
Fertilizer subsidy is one of the important subsides related to agriculture sector in

India. The other major subsidies are food subsidies electricity and canal water.
COMPANY PROFILE OF COROMANDEL FERTILIZERS
Introduction:
Coromandel International Limited is in the business segments of Fertilizers, Specialty

Nutrients, Crop Protection and Retail.
Coromandel manufactures a wide range of fertilizers and markets around 2.9 million
tons making it a leader in its addressable markets and the second largest phosphate fertilizer
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player in India.
In its Endeavour to be a complete plant nutrition solutions company, Coromandel has

also introduced a range of Specialty Nutrient products including Organic Fertilizers.
The Crop Protection business produces insecticides, fungicides and herbicides and
markets these products in India and across the globe. Coromandel is the second largest
manufacturer of Malathion and only the second manufacturer of Phenthoate.
Coromandel has also ventured into the retail business setting up more than 425 rural
retail centers in the agri and lifestyle segments.
The Company clocked a turnover of Rs.9668 crores (USD 2.2 billion) in 2008-09.Coromandel
was ranked among the top 20 best companies to work for by Business Today and was also
voted as one of the ten greenest companies in India by TERI, reflecting its commitment to the
environment and society.
Coromandel is a part of the Rs.15,907 crore (USD 3.14 billion) Murugappa Group.
VISION STATEMENT :
To be the leader in the phosphate fertilizer industry producing high quality

fertilizers at low cost and giving satisfaction to all stake holders.
It should have:
1. High quality products and brand image
2. Modern, cost effective and energy efficient manufacturing facility
3. Profitable operations
4. High level of satisfaction to stake holders.
MISSION STATEMENT:
To Enhance the prosperity of farmer through the supply of quality farm input & related
services to ensure value for money
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PHILOSOPHY STATEMENT :
Adhere-
To ethical norms in all dealings with shareholders, employees, customers,
suppliers, financial institutions and government.
Provide-
Value for money to customers through quality products and services.
Treat-
Our people with respect and concern provide opportunities to learn, contribute
and advance, recognize and reward initiative, innovativeness and creativity.
Maintain-
An organizational climate conducive to trust, open communication and team
spirit a style of operation, benefiting our size, but reflecting moderation and humility.
Manage-
Environment effectively for harnessing opportunities.
Discharge-
Responsibilities to various sections of society thereby preserve environment.
Grow-
In an accelerated manner, consistent with values and benefits, by continuous organization
renewal.
THE SPIRIT OF THE MURUGAPPA GROUP:
INTEGRITY: We value professional and personal integrity above all else. We achieve our
goals by being honesty and straightforward with all our stakeholders. We earn trust with every
action, every minute of every day.
PASSION: We play to win. We have a healthy desire to stretch, achieve personal goals and
accelerate business growth. We strive constantly to improve and be energetic in
everything that we do.
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QUALITY: We take ownership of our work. We unfailingly meet high standard of quality in
both what we do and the way we do it. We take pride in excellence.
RESPECT: We respect the dignity of every individual. We are open and transparent with
each other. We inspired and enable people to achieve high standard and challenging goals. We
provide everyone equal opportunities to progress and grow.
RESPONSIBILITY: We are responsible corporate citizens. We believe we can help make a
difference to our environment and change lives for the better. We will do this in a manner
that befits our size and also reflects our humidity.
OBJECTIVES OF COROMANDEL
 To enable the farmers “grow more” by producing and supplying highly nutritious
complex fertilizers at minimum cost.
 To maximize, the efficiency of both the men and machinery through continuous
up gradation of technology and providing training investment.
 To satisfy shareholders by giving them handsome returns on their investment.
SWOT ANALYSIS
STRENGTHS:
 Very long experience in the field of producing and selling fertilizers.
 Up-to-date technology and continuous up gradation.
 Optimum capacity utilization
 Enjoying great brand and corporate image
 Dealer and farmer loyalty.
 Financially strong and firm.
 Niche Marketing
 Strong promotional attractive
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 Widespread sales network
 Minimum Labour problem

 Well-trained employees and good work culture.
WEAKNESS
 Neglecting study based on sales promotion of retail outlets.
 Marketing by intermediaries
 Poor availability of product.
 Import of major raw materials
OPPORTUNITIES
 Increasing trend in using complex fertilizer areas.
 Large areas under each and oil seed crops
 Growling awareness and education among farmer’s community
 Modern farming practices
 The wide gap between demand and supply in Indian fertilizer market
 Giving more emphasis the use of complex fertilizer for balanced fertilization.
 Government subsidy reduction on urea for facilitating the use of complex fertilizer.
THREATS
 The heavy competition in fertilizer market.
 Frequent/subsequent changes in government policies.
 Shifting of demand from the company’s products to competitor’s DAP
 Huge consumption of urea cover complex that is offered at lessor cost in the market.
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 Tynerance of the Agricultural sector by the present government.
 Almost complete dependence on import of raw materials which will effect the
company performance if the import prices are increased
THE MAJOR BANKERS HELP CORAMANDEL FINANCIALY
State Bank of India HDFC
Bank Limited IDBI Bank
Limited ICICI Bank
Limited Hongkong and
Shanghai
Banking Corporation Limited
ORGANIZATIONAL STRUCTURE:
The supervisory board of Murugappa group supervises the organization of

Coromandel International Limited. The top most authority of the whole Coromandel
International Limited is administered and controlled by the president and managing
director. The main registered office of Coromandel International Limited is located at
Hyderabad. The Present Managing Director of Coromandel International Limited is
Mr.V.Ravichandran. The Visakhapatnam Plant is headed by the vice president who at
present is Mr. N. Seetharam who undertakes the in charge of all the levels of departments
in the organization.
Visakhapatnam Plant Location:
The plant is situated in 500 acres of site about 5 km from the harbour. The site is
located on the east coast of Visakhapatnam and has been leased from
Visakhapatnam port trust for a period of 50 years with renewal options, at the port;
Coromandel International Limited operates its own bulk freight raw material
unloading berth, which is an added advantage as they import many for Coromandel
International Limited Company.
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The plant uses a lot of seawater in the process for cooling purpose Vizag being a
seacoast provides the facility. Coromandel International Limited is serving the
farming community of India for the past 3 decades by producing around 1 million tonnes
of complex Fertilizers per annum and catering to the needs of agricultural society.
Plants:
Coromandel International limited has mainly three plants. They are:
1. Sulphuric acid plant-This plant is designed and constructed by M/s. Simon

Carves India Limited. It has a rated capacity of 1200 million tonnes per day.
Sulphur is the raw material, which is imported from abroad from countries like USA,
Japan and Gulf.
2. Phosphoric acid plant-This plant is designed and constructed by M/s. Darr

Oliver of USA is used in manufacturing of cement. It has a rated capacity of 400
million tonnes per day. Rock phosphate a mineral from foreign countries such as
USA, Africa and Australia and is still looking for other sources. Rock phosphate and
sulphuric acid are reacted to give phosphoric acid and gypsum. Filtering separates
gypsum and it is a by-product, which is a good source of income by sales.
3. Complex Fertilizer plant-Complex Fertilizer plant has rated capacity of 1400

million tonnes per day. Ammonia and phosphoric acid are reacted in a reactor to
form ammonium phosphate and urea is added to this mixture. The urea prill is coated
with ammonia phosphate to form the urea ammonia phosphate, which is a Fertilizer.
Achievements:
Coromandel International limited a reputed Fertilizer company in India stood first in

achieving the following:
1. First in India achieved to commercially manufacture high analysis complex

fertilizer, which is urea ammonium phosphate 28:28:0 with high nitrogen and
phosphate content in 1:1 ratio.
2. First in India achieved to install a large sulphuric acid plant based on DCDA
technology to control sulphur dioxide emission.
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3. First in India achieved successfully to implement total recycling of seawater
for its effluent recirculation system attached to phosphoric acid plant.
4. First in India achieved to install a terminal for import and handling of molten
sulphur in environment friendly project.
Functional Areas
Coromandel International limited comprises of four functional areas. They are:
1. Manufacturing and production
2. Marketing
3. Finance
4. Human Resources
1. Manufacturing and Production:
The main objectives of manufacturing unit of Coromandel International Limited are
1 To be a low cost Fertilizer manufacturer
2 Emphasis on safety and environment improvement
3 T rust on energy conservation
The plant has planned to undertake manufacturing of single super phosphate with
estimated production volume of 0.7 lakh tones per annum. The basic raw materials used
for manufacturing are phosphoric acid, urea and ammonia. They buy naphtha to make
ammonia from HPCL. Rock phosphate is imported from USA and Sulphur is imported
from USA and gulf countries.
Products:
1. 1. Coromandel International Limited sells its product under the brand name
“GROMOR’. 1. Gromor (28:28:0) urea ammonium phosphate is one of the best
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products of Coromandel International Limited . It has a unique granule
configuration Urea Prill Coated with ammonium Phosphate, which ensures nitrogen
availability to the crop over a longer duration of time.
2. Gromor (14:35:14) ammonium phosphate potash, Npk is a scientific Fertilizer

with the highest nutrient content of 63% among NPK complex available in India.
3. Gromor (20:20:0) and parampos (16:20:0) ammonium phosphate sulphate gives

15% sulphur for the soil apart from their ammonia and phosphate content.
The products of Coromandel International limited are sold in Andhra Pradesh,

Orissa, west Bengal and Madhya Pradesh.
RANGE OF PRODUCTS & CUSTOMERS:
Product/ Segment Top Key Customers
service
28-28-0 High Analysis Farmers by Government Institution

Complex Fertilizers in AP, Orissa, and West Bengal use
14-35-14 these products for soil application.
20-20-0
10-26-26
24
Gypsum By-products Cement Industries –As a Retarder in
Cement manufacture. Farmers in
AP,Orissa,West Bengal, Madya
Pradesh use this product as a
neutralizer for Acidic Soils
Hydrofluosilistic By-products M/s Alufluoride Ltd-use this product

for the manufacture of Aluminium
Acid Fluoride which in turn is used for the
manufacture of Aluminum.
Gromor Bentonite Farmers in AP, Orissa, West Bengal,

and MadyaPradesh use this product
Sulphur as a soil conditioner in lowering PH
of soils and to bring down alkalinity
in Saline/calcareous soils.
Gromor Spray Specialty Farmers in AP, Orissa, West Bengal,

19:19:19 Nutrients
for foliar application, for better
absorption of nutrient from leaves
and to counteract adverse soil
conditions.
Gromor Power Farmers in AP, Orissa, West Bengal,

19:19:19 for Drip irrigation.
Power:
Since the plant functions continuously the company consumes 24 mg watts

of electric power each day. It has its own source of generating power through its
two thermal power stations and one diesel power, which altogether produces 7.5
mg watts; rest is taken from APSEB, the state electricity board
Marketing:
Relating to the field of marketing the objectives are:
1. Explore new markets and crop areas

2. Minimum distribution cost and lead time
3. Provide meaningful information to management in time.
4. Ensure quality and timely positioning of products as per market needs.
The major products of CIL are complex Fertilizers marketed in the trade in
25
brand name of "GROMOR" where most of the trade is done through railways. Its
marketing centers are mainly Andhra Pradesh, Orissa and West Bengal. In Andhra
Pradesh the Secunderabad branch concentrates on marketing. The raw materials like
rock phosphate and sulphur, which are useful for the production, are imported from
US and Gulf. The best product of Coromandel International Limited GROMOR
28:28:0 which is urea ammonium phosphate is marked in 50kg bags and stored in a
tank area known as tank bund area. They have a canal from sea to salt water, which is
used for cooling purposes.
Quality Policy:
Coromandel International Limited is committed in supplying phosphoric

Fertilizers and related products, which satisfy the requirements of customers and
comply with applicable specifications.
Further it is committed to continual improvement of quality management systems

and processes with the objectives of improving the product quality.
They strive to achieve the quality objectives and customer satisfaction by
1. Developing, implementing and maintaining quality management systems to

international standards.
2. Imparting requisite knowledge, skills and competency to employees and
3. Ensuring employee’s participation in continuous improvement measures.
Non-Fertilizer Activities:
1. Sale of intermediate such as sulphuric acid, phosphoric

acid.
2. Sale of Fertilizer raw material such as sulphur, rock phosphate, potash etc.
2. Sale of by-products like gypsum and fluorine.
3. Finance:
26
Coromandel International limited laid its foundation stone in 1964 with an
investment of 50 crore and leading presently with a turnover of about 613 cores and
yields 10% growth rate on turnover and 27-30% of returns per year and spends
around 20 to 30 lakh per month as salaries to the employees.
The main objectives of finance department are:
1. Effective funds and foreign exchange management
2. Controls cost including reduction in interest cost
3. Tax planning
As per the balance sheet stated on 31st March 2001 the fixed assets of the
company cost around 250 cores and, has gained a net profit of around 46.87 cores for
the year 1998-99. Except for a couple of years Coromandel International Limited is
being continuously a profit based company.
The company is of vital importance to the economy as it supplies Fertilizers to

agriculture, which is the backbone of the Indian economy. Thus the company's
emphasis has been on extension and development involving constant updating of
improved agricultural practices. These activities have helped Gromor to establish
itself as a leader and pioneer beard. It is titled as the farness friend.
Plants of CIL:
Ammonia Plant:
Ammonia plant of 357 tonnes per day capacity was designed and constructed
by M/S Kellogg of USA. The basic raw material is Naphtha which is obtained from
Hindustan Petroleum refinery, Visakhapatnam.
Urea plant:
Urea plant which has an operating capacity of 400 tonnes per day, based on
the CPJ - Allied, the process, the design and construction were done by M/s Nucamin,
Nunmate of USA.
27
The urea pills then send to complex plant for manufacture of urea. Ammonia
phosphate 28:28:0.
The Urea plant has been shut down due to the shutdown of Ammonia plant.
Sulphuric Acid Plant:
Sulphuric Acid plant of CFL has an operating capacity of 1300 tonnes per day.
This was designed and constructed by M/s Simon Carves (India).
Phosphoric Acid Plant:
The plant was designed and constructed by M/s Dorroliver, USA. The original
designed capacity of the plant was 255 tonnes per day, which was increased to 325
tonnes per day during revamp in 1975. The plant is now producing on an average
above 350 tonnes of phosphate.
Complex plant:
The complex plant utilizes ammonia, phosphoric acid, urea to make Ammonia
phosphate 28:28:0. Where as for manufacturing complex NPK 14:35: 14, ammonia
and phosphoric acid are used along with Potash, which is a bought out raw material,
mixed with the outer feed stocks in the complex plant. In case of manufacture of
16:10:0, 20:20:0 Ammonia phosphoric acid and sulphuric acid are used as feeds.
Due to increase in prices of Hydrocarbons, Operations of Urea and Ammonia

production facilities have been suspended. Alternate arrangements are in place.
Ammonia and liquid sulphur are being imported at an economical rate. Urea too is
being imported.
The production material is bagged in 50 kg and dispatched by rail/road.
CAPACITIES:
28
Ammonia : 1, 05,000MT/Yr
Urea : 74, 000 MT/Yr
Sulphuric : 3, 65,000 MT/Yr
Phosphoric : 1, 13,050MT/Yr
Complex(28:28:0) : 4,00,000MT/Yr
Plant capacities are all given in Metric Tons.
ROLE OF CIL IN INDIAN AGRICULTURE:
From the very beginning Coromandel proved to be a boon to the Indian farmers.
It brought to India the world-class production facilities with a new generation of fertilizer
products. Coromandel vision had started playing a vital role in the resurgence of Indian
Agriculture.
Coromandel introduced a branded product Gromor, which is a high analysis NP

complex fertilizer. It is the first in the world to produce high analysis NP complex
fertilizers in the highest 1: 1 ratio. This was implemented when most of the fertilizer
products available in India were not balanced in nutrient contents.
Gromor in a short span of time established itself as a popular brand where and entire
generation of farmers ahs grown up with it in a number of sates using it wide variety of
crops.
Gromor 28:28:0 is one of the best of its kind in the world. It has unique granule
configuration where in a urea prill at the centre is coated with ammonia phosphate, which
ensure nitrogen availability to the crop over a longer duration of time.
Coromandel International limited gives importance to human resources and it lays

emphasis on human safety and welfare. Presently the company comprises of about
600 employees among whom about 425 employees are non managerial and about 175
employees are managerial.
COROMANDEL MAJOR COMPETITORS
29
 The Fertilizers and Chemicals Travancore Ltd (FACT).
 Godavari Fertilizers and Chemicals Ltd., (GFCL).
 Gujarat Narmada Valleys Fertilizers & Chemicals Ltd., (GNFCL)
 Gujarat State Fertilizers Company Ltd., (GSFCL)
 Hindustan Lever Ltd., (HLL)
 Indian Farmers Fertilizers Co-operation Ltd (IFFCO)
 Madras Fertilizers Ltd., (MFL)
 Pyrites and Phosphates Ltd., (PPL)
 Rastriya Chemical and Fertilizers ltd., (RCF)
 Southern Petrochemical Industries Corp Ltd., (SPIC)
 Zuari Agrochemicals Ltd., (ZAL)
 Osklal Chemicals and Fertilizers Ltd., (OCFL)
Awards & Achivements :
 The FAI Best Production Performance Award – 2006 for the Phosphoric Acid
Plant at Vizag,
 Award for 2005-06 Best Energy Conservation in the Fertilizer sector received
by Vizag Plant on December 14 2006, National Energy Conservation Day.
 The FAI Best Video Film Award – 2006 for the film on ‘Gromor Sulphur’ for
the 5th time.
 National Award (1st Prize) for House Journal – 2006 from The Public
Relations Society of India, New Delhi, received for ‘The Voice’ ( house
journal ) for the 2nd consecutive year.
 National Award (2nd Prize) for Video Film – 2006 from The Public Relations
Society of India, New Delhi received by Marketing Department (Fertilizers )
30
for the film “Cheetah” (Helping Hand)
 British Council ‘Five Star’ rating for Safety Management System in 1998.
 First prize for safety, among the 162 fertilizer companies in the International
Fertilizer Industries Sectional Contest.
 Andhra Pradesh Pollution Control Board’s award for ‘Waste Minimization at

Source and Adopting Cleaner Technologies’ for 2001-02.
 FAI award for ‘Environmental Protection in NP/NPK Fertilizer Plant

Category’ for 1995-96.
 Adjudged one of the ‘Ten Greenest Companies in India’ by a joint survey of

Tata Energy Research Institute and Business Today magazine.
 Several other awards from the Central and State Government and other
institutions like AP Pollution Control Board, Jawaharlal Nehru Award for
Pollution Control and Energy Conservation.
 Received a Commendation Certificate for "Strong Commitment to HR

Excellence" from the Confederation of Indian Industries (CII).
31
THEORETICAL FRAME WORK ON
INVENTORY MANAGEMENT
Inventory is a list for goods and materials, or those goods and materials themselves,
held available in stock by a business. It is also used for a list of the contents of a
household and for a list for testamentary purposes of the possessions of someone who has
died. In accounting inventory is considered an asset.
In business management, inventory consists of a list of goods and materials held

available in stock
It is concerned with keeping enough product on hand to avoid running out while at
the same time maintaining a small enough inventory balance to allow for a reasonable
return on investment. Proper inventory management is essential to the financial health of
the corporation; being out of stock forces customers to turn to competitors or results in a
loss of sales. Excessive level of inventory, however, results in large inventory carrying
costs, including the cost of the capital tied up in inventory.
The aspect of management of inventory is especially important in respect to the fact

that in country like India , the capital block in terms of inventory is about 50% of the
current assets . It is therefore, absolutely imperative to manage efficiently
and effectively in order to avoid unnecessary investment. Although to maintain low

inventories may prove to be profitable but to maintain very low inventories may prove
risky on the contrary.
This aspect of management if tackled in a proper way may prove to be a boon its
effective and efficient management would result in the maintaining of optimum level of
inventories. At this level the profitability of the organisation will not be jeopardised at the
cost of inventory.
Inventory can be classified in to seven cantegories they given below:
 Raw materials
 Finished parts
 Work in progress
32
 Finished goods
 Tools
 Machinery
 Suppliers
The Principal items of inventory are as follows:
Raw materials: Raw materials unfabricated material which have undergone no

conversion what so ever since their receipts from the suppliers
Finished parts: finished parts which may either be brough out parts or pieces brough out
parts are those finished parts sub-assemblies or assemblies which are purchased from
outside suppliers piece are those parts which are manufactured at the company own plant
from the basic raw materials
Work in progress: It comprises of the items in partially completed condition of

manufacture.
Tools: These are comprise of standard tools and hand tools standard tools used on
machine such as saws drills remers etc and the hand tools are drill guns hammers mallets
etc
Suppliers: Include material used in running the plant or marking company

products but do not they go into the product.
Machinery spares: Are those which are used to maintain the machine without any
problem so that there wont be unnecessary breakdowns these spares include consumable
spares replacement spares ratable spares ,insurances spares.
INVENTORY MANAGEMENT PROGRAM OVERVIEW
The rapidly changing needs of customers and resulting margin reductions are
forcing distributors to explore innovative methods to cut cost, increase customer
service, and maximize resource utilization. Inventory is the largest asset that a distributor
has to manage to maximize return on assets, increase profitability and gain competitive
advantage in the market place forecasting, and setting statistical reorder point and buy
33
quantities. The program involves interactive exercises and games as well as a case-
study based learning experience.
OBJECTIVES OF INVENTORY MANAGEMENT
The objectives of inventory management consists of two counter balancing parts:
 To minimize the firms investment in inventory
 To meet a demand for the product by efficiently organizing the firms

production and sales operation. These two conflicting objectives of inventory
management can also be expressed in terms of cost and benefits associated with
inventory An optimum level of inventory should be determined on the basis of the
trade off between cost and benefits associated with the level of inventory.
Valuation of components of inventory:
value which every manufacturing firms need to account for the financial reports so
various firms follow various method of inventory valuation .Few are mention below:
Ordering costs: such cost also know as acquisition are set up costs this category of
34
cost is associated with the acquisition or ordering of inventory .Firms have to place
orders with suppliers to replenish inventory of raw materials. the expenses
involved are referred to as ordering cost A part from placing
Orders outside the various department has acquired materials from stores.
Any expenditure involved her is a part of the ordering cost Included in the ordering
costs involved in preparing a purchase order or requisition from and receiving
inspecting and recording the goods received to ensure both quantity and quality.
Carrying cost: The second broad categories of cost associated with inventory with
inventory are the carrying costs .They are involved in maintaining or carrying
inventory .the cost of holding inventory may be divided into two categories those
that arrives due to storing the inventory .The main components of this categories are
storage cost i.e tax depreciation insurance maintenance if the building ulities of
inventory against fire and theft .Services cost such as labor for handling inventory
clerical and accounting cost
Stock –out costs: They are invisible yet very import costs which a company has to
incur if there is a stock out resulting in a loss of production these costs are in the
from of loss of profit on lost of goods will adverse impact on future order and
temporary adverse effects on machinery because of lack of use etc
Benefits of inventory
management:
Either in this chapter we gave already discussed about the inventory as a

current asset. Iventories enable firms in the short run to produce at s rate
greater than purchase of raw materials and vice versa.
The benefits associated with the inventory management can be divided

in to following 3 types of benefits they are:
A. Benefits in
purchasing:
If the purchasing of raw materials and other goods is not tied to production
/sales affirm can purchase a large quantity that as warranted by usage in
35
production i\or the sales level firms can purchase good before anticipated price
increases. this will lead to a decline in the cost of production .Inventory serves as
hedge against price increases as well as shortages of raw materials.
B. Benefits in
production:
Finished goods inventory serves to uncouple production and sale .That
enable production at a rate different from that of cost .That is production can be
carried on at a higher at lower than the sales rates in brief since inventory permits
least cost production scheduling production can be carried on more efficiently.
C. Benefits in
selling:
The maintenance of inventory also a help a firm to enchance its sales
efforts ,A firm will not be to meet demand instantaneously there will be a lag
depending upon production process If the firm has inventory actual sales will not
have to depend on lengthy manufacturing process. A related aspect is
that inventory serves as competitive marketing tools to meet customers demands
inventory ensures the continued patronage of customers.
Inventory controls
techniques:
 ABC analysis
 XYZ analysis
 VED analysis
 HML analysis
 FSN analysis
ABC
ANALYSIS
It is an inventory application of the Pareto principal which states that there are a
“critical few and trivial man.” Idea is to establish inventory policies that focus
resources on the few critical inventory parts and not on many trivial ones. In this
technique, the items of inventory are classified according to value of usage.
The higher value items have lower safety stocks, because the cost of production is
36
very high in respect of higher value items. The lower value items carry higher
safety stocks. ABC analysis divides the total inventory list into three classes A, B,
and C using the rupee volume, as follows:
Items in class 'A' constitute the most important class of inventories so far
as the proportion in the total value of inventory. The 'A' items consists of
approximately
15% of the total items, accounts for 80% of the total material
usage.
Items in class B' constitute an intermediate position, which constitute

approximately 35%of the total items, accounts for approximately 15% of the total
material consumption. Items in class 'C’ is quite negligible. It consists
remaining
50% items, accounting only 5% of the monetary value of total material
usage.
The numbers are just indicative and actual break-up will vary from situation
to situation. The above categorization is represented in the table given below:
%of value
Class of items %of items
A 15 80
B 35 15
C 50 5
TOTAL 100 100
The ABC analysis of inventory class 'A' is made up of inventory items

which are either very expensive or used in massive quantities. Thus these items,
though few in number contribute a high proportion of the value of inventories. Class
'B' items are not so few in number, but also they are not too many either. Value
wise also, they are neither very expensive nor very cheap. Moreover, they are
used in moderate quantities. Class 'C contains a relatively large number of
37
items. But they are either very inexpensive items or used in very small quantities
so that they do not constitute more than a negligible fraction of the total value
of inventories. The control of inventory through
XYZ Analysis:
 Inventory holding will also be analyzed with reference value of

the holding against each item it is found that about 70% of the
total holding would be covered by category will be classified as ‘X’
class items similarly items accounting for the remaining 20%
contributing will be categorized as ‘Y’ class items and the
remaining items will be listed in ‘Z’ class this analysis is usually
done for the annual stock review
 In ABC analysis consumption value of items for a particular time

span is considered
 In XYZ analysis inventory value of items on a particular day will

be considered
 All steps in ABC analysis are followed in XYZ analysis
VED Analysis:
 VED analysis is generally useful for spares parts inventory

for company’s plant and machinery
 Items in store are classified based on critically and availability
is market.
 Vital
 Essential
 Desirable
Vital:
38
It is not ready to available in market and the vital for for plant operations.
Essential:
 Can be replaced
 Lead time for procurement is around 2-3 months.
Desirable:
 The items is available at market
 Lead time for procurement is also not much (around the month)
 Cost will not much
HML Analysis:
This analysis is based on cost of items H,M,&L alphabets represent items having
cost medium cost and lower cost.
FSN
Analysis:
Under this the quality and rate of consumption are to be taken in to consideration
here
‘F’ stands for fast moving items ‘S’ stand for slow moving items and ‘N’ stands for
non-moving items.
NON-Moving item
Analysis:
All items held in stock will be subject to non –moving analysis the items for
different non-moving period like over 3 years ,over 5 years and 10 years so as to
critically analysis the possibility of utilization of these items at other wise for
declaration non- moving especially those items which have not moved for more than
5 years .materials management department with the concerned technical department
will jointly do this analysis and separate list will be prepared i.e group wise e,for non
moving items beyond 5 years on an annual basis code groups and indented again
until the existing stock are ulitiized every effort will be made to keep as low as
39
practicable because this is non –productive inventory which is blocking the capital
storage space needing preservation and up keeping efforts and result in extra
inventory y carrying cost the company reduce the non moving inventory by regular
review for utilization or by declaring as surplus obsolete.
Codification
:
Any organization engaged in production repair or construction is oblinged to stock a
large number of items of store it is essential to maintain accurate stock records
of these items and also to know their location in store warehouse the normal way of
identifying an article is by simple description but this method is far from
satifactory the best way is to list out the various items classifying or grouping them
in some is sufficient to identify the items each code number is unique and represents
one single items by this management of stock will be easier there are three
types of coding system are i.e alphabetical alphanumeric and numerical records with
the help of data processing machines are able to give any output using e codes.
Standardization and variety

reduction:
It is the process of establishing agreement up on acceptable levels of various

characteristics of product e,g, quality design dimensions physical characteristics
chemical composition performance etc on the basis of study and experience
gained by industrial the some times in cooperation with statutory bodies of the
government the established agreement or uniform identification is termed a standard/
specification standardization is applied usually in two distinct areas industry.
 Standardization of product s
 Standardization of business practical.
 Automatic Replacement Systems
For few items in the stock that frequently moving and are usually of low value and
required by more than one department are subjected to ARES.ARS is completely
controlled by materials control department ;they actually fix a minimum, maximum
and recorder level , so as soon as these items reaches reorder level material
control department will monitor it and indent is prepared immediately for
40
procurement of these items.
Stores
management :
Stores are used for receiving ,storage and supply of the goods,it plays a major role in
inventory management ,stores are the center of activity of materials in motion , an
efficient system must aim at good systems and procedures efficient O&M and
smooth and speedy receipts and issues .The main objective of stores will be to
provide efficient service to all operating functions such as production construction,
repair and maintenance. These are usually two sections in stores
 Receipt /issue section

 Custody section
Custody section usually takes care of storage and preservation of the incoming goods
where as issue /receipt section confirms of right input according to the order
and issues the same according to the requirements .
Stores
Preservation :
Proper material storage it very important and it is carried out very effectively by the
in the by concerned for carrying out an effective preservation programs factors such
as economic aspects , period of idleness of a port, condition of the part nature of the
exposed surface as well as applicability of specific protective to be applied are
considered and make sure that they do not exceed the cost of the part to be preserved
some of the procedures followed are as follows.
 All ferrous spares are given analysis protective cost of paying /varnish
and stored.
 Precision spares like instruments ,electronic and electrical spares, ball
and roller bearing are covered in polythene bags, enclosing moisture
absorbent chemicals like silica gel etc.,
 Precision spares are maintained in dust free air –conditions rooms with
out sunlight and moisture.
 French chalk powder is sparkled whenever possible an rubber items like
41
tires, tubes hoses, v belts etc.,
 Items like electrodes are kept intact in original packing and kept in dry
storage room with heaters to avoid excess of moisture affecting the coating.
 Sintered bush bearings are soaked in warm oil for 24hrs once in analysis year.
 Pipes over 2.are flushed /cleaned with dry air in these cases protective
paints the exterior painting .
 Vertical stocking of grin dining wheels with partitioning in between
is necessary so that the faces do not come in to contact with each other.
 Strip heaters in all high voltage motors, LT motors should be provided to
avoid moisture entering in to the motors.
 Copper parts are protected against ingress of ammonium salts.
 Silver and lead parts are cleansed with fresh water.
 Compressors and turbines of multistage pumps are rotated on their
bearing every quarter to prevent staging/clogging.
 Anti-rodents and insecticides measures are taken on regular basis.
 Shaft gears and impellers are stored horizontally after painting
with dewatering protecting films such as rasgards and rust line etc…
 Fasteners and screws that are kept in the racks are treated with
hard preservation Film.
 Perishables spares like v belts with a low shelf life are identified and the FIFO
method of issues are practiced.
Valuation of components of inventory:
Inventory involves certain value ,which every manufacturing firm needs to

account for in the financial reports .So various firms follow various methods
of inventory valuations. Few are mention below:
Cost involved in
Inventory
One operating objective of inventory management is to minimize the

cost associated with inventory fall into two basic categories:
 Ordering or acquisition or 5 set-up cost
42
 Carrying cost these costs are important elements for the optimum
level inventory decisions.
Ordering
cost:
Such cost is also known as acquisitions are set up costs.This category of costs is
associated with the acquisition or ordering of inventory .Firms have to place orders
with suppliers to replenish inventory of raw materials .The expenses involved are
referred to as ordering cost. Apart from placing orders outside the various
departments have acquire materials from the stores .Any expenditure involved here is
anaylsis part of the ordering cost. Included in the ordering cost are costs involved in:
preparing a purchases order or requisition form land receiving ,inspecting , and
recording the goods received ti ensure both quantity and quality .
Carrying
costs:
The second broad categories of cost associated with inventory are the carrying
costs .They are involved in maintaining or carrying inventory. The cost of holding
inventory may be divided into two categories those that arrives due to storing the
inventory .The main components of this category are: storage cist, i.e., tax
depreciation, insurance, maintenance of the building utilities: insurance of inventory
against fire and theft.
Controlling your inventory:
Too maintain an in-stock position of wanted items, it is necessary to establish

adequate
Controls over inventory in stock. There are several proven methods for inventory
control . They are listed below, from simplest to most complex.
Visual control enables the manager to examine the inventory visually ti
determine if addtioal is required .In very small business where this method is used
,records may not be needed at all or only for show moving or expensive items.
43
As a business grows ,it may find a need for analysis more sophisticated and
technical form of inventory. Today,the use of computer systems and technical form
of inventory is far more feasible for small business than ever before ,both through the
widespread existence of computer service organizations and the decreasing cost of
small-sized computers. Often the justification for such analysis computer- based
system is enhanced by the fact that company accounting and billing procedures can
also be handled on the computer .
Point –of-sale terminals reply information on each item used or sold.

The manager receives information printouts at regular intervals for review and
action .
Off-line point-of-sale terminals reply information directly to the supplier’s

computer who uses the information to ship additional items automatically ti the
buyer/inventory manager.
The final method for inventory control is by an outside agency. A

manufacturer’s representative visits the large retailer on analysis scheduled
basis,takes the stock count and writes the reorder. Unwanted merchandise is removed
from stock and retured to the manufacturer through analysis predetermined,
authorized procedure.
Inventory Management of finished goods:
Sales& distribution department ensure that ,finished goods reach the right
place at right time and at right cost
 : Operation department prepare the production plan and sends it to

vice president marketing who along with RMO of different region prepares a
sales paln& sends it to the sales & distribution department these plan
are of different formats.
 Product wise,season wise sales plan.
 Product wise,month wise sales plan.
 Marketing office wise, month wise DAP sales plan.
 Marketing office wise, proiduct wise4 ssales plan.
44
 Monthwise, destinnation wise rake movemernt plan.
Sales& distribution depatment consider both sales and prodcction while preparing a
dispatch plan,S&D department also make sure cross check the monthly stock
reconciliation report sent by RMO from every region so,that details about a the
closing stock at each center are know so any variation in the closing stock will lead to
all little variation in the dispatch plan when compared to sales plan.
Purchasing system
Effective purchasing required meeting the following:
 To keep pace with changed market condition

 To satisfy demand during period of replenishment
 To carry reserve stock to avoid stock outs
 To prevent loss of sales production time
 To level out or stabilize production
 To satisfy other business constraints
 Suppliers condition of lien quantity
 Government regulations
 Seasonal availability
 Demand forecast error
 Suppliers delivery interval
 Lead time of customer/suppliers
 Minimization of delivery cost
45
DATA ANALYSIS AND INTERPRETATION
Inventory control is very essential for any organization an organization represents aggregate
o those items which are either held for the sale on ordinary course of business or are in the process of
production of goods and services in case KPR fertilizers raw materials department procures the
required raw materials where as central stores and materials department take care of spares consumed
during the production and sales distribution are responsible for managing the finished goods. The
main tools used by the company for the inventory control in stores for managing the spares are:
 ABC Analysis
 XYZ Analysis
 FIFO (First in first out)
ABC Analysis for the year 2012-13

46
s.no Items Group Wise Cost per Units Annual Rank
unit Consumption(Rs)
1 MECH EQPT Spares 24,613.00 387 95,25,231.00 1
2 Bearings 16,636.73 81 13,47,575.13 7
3 Fasteners 4,119.11 92 3,78,958.12 11
4 Lubricants 41,211.76 32 13,18,776.32 8

5 Tools and jigs 1,112.63 72 80,109.36 16
6 Electrical spares 5,078.85 89 4,52,017.65 9
7 Instruments Spares 3,042.55 87 2,64,701.85 13
8 Building material 24,613.00 48 42,88,800.00 2
9 Safety Items{GO5} 16,636.73 12 2,95,326.24 12
10 Chemicals 4,119.11 19 4,34,720.00 10
11 Lab chem 2 Apparatus 41,211.76 9 1,29600.00 15
12 EDP 1,112.63 8 20,600.00 17
13 Documentation Material 5,078.85 112 16,10,336.00 6
14 Fire items and Security 3,042.55 15 1,33,218.75 14
15 Fuel-4116522 24,613.00 0 - 18
16 General 39,444.18 52 20,51,097.36 5
17 Miscellaneous 46,178.94 79 36,48,136.26 3
18 PP Thred-54728 24,91,400.00 0 - 19
47
Annual Consumption for the year 2012-13
Item name Annual Cumulative(Rs) Cumulative%

consumption(Rs)
MECH EQPT Spares 9525231.00 9525231.00 33.82
Building material 4288800.00 13814031.00 49.05
Miscellaneous 3648136.26 17462167.26 62.01
Iron & steel 2178962.88 19641130.14 69.75
General 2051097.36 21692227.50 77.04
Documentation material 1610336.00 23302563.50 82.75
Bearings 1347575.13 24650138.63 87.54
Lubricants 1318776.32 2596814.95 92.23
Electrical spares 452017.65 26450932.60 93.83
Chemicals 434720.00 26855652.60 95.37
Fasteners 378958.12 27234610.72 96.72
Safety items(GO5) 295326.24 27529936.96 97.76
Instrument spares 264701.85 27794638.81 98.70
Fire items and security 133218.75 27927857.56 99.18
Lab chem. & Apparatus 129600.00 28957457.56 99.64
Tools and Jigs 80109.36 28137566.92 99.93
EDP 20600.00 28158166.92 100
48
Interpretation:
Items constituting 70% of the total annual consumption by value are classified as
A class items .The items are MECH EQPT Spares Building Material ,Miscellaneous,
Iron & steel The next 20% of the annual consumption value are classified as ‘B’ class
items .The items are General Documentation material Bearings.
The remaining 10% of the value are classified as ‘C’ class items are
Lubricants, Electrical spares ,Fasteners ,Chemicals, Instrument spares ,Safety
items ,Fire items and security, lab chem. & apparatus, tools and jigs and EDP.
49
S.no Items Group Wise Cost per Units Annual Rank

1 MECH EQPT Spares 24,613.00 406 9992878.00 1
2 Bearings 16,636.73 92 1530579.16 7
3 Fasteners 4,119.11 108 444869.88 11
4 Lubricants 4,1211.76 65 1030294.00 8
5 Tools and jigs 1,119.63 91 101249.33 15
6 Electrical spares 5,078.85 97 492648.45 10
7 Instruments Spares 3,042.55 91 276272.05 13
8 Building material 24,614.00 51 4556850.00 2
9 Safety Items{GO5} 16,636.73 15 36915.80 12
10 Chemicals 4,119.11 22 503360.00 9
11 Lab chem 2 Apparatus 41,211.76 11 158400.00 15
12 EDP 1,112.63 9 23175.00 17
13 Documentation Material 5,078.85 126 1811628.00 6
14 Fire items and Security 3,042.55 21 186506.25 14
15 Fuel-4116522 24614.00 0 - 18
16 General 39,449.18 78 3076646.04 5
17 Miscellaneous 46,178.94 69 3186346.86 4
18 PP Thred-54728 24,91,400.00 0 - 19

50
consumption(Rs)
MECH EQPT Spares 9992878.00 9992878.00 36.67
Miscellaneous 3540814.68 18090542.68 60.42
Iron & steel 3186346.68 21276889.54 70.28
General 3076646.04 24353535.58 77.75
Bearings 1530579.16 27695742.74 89.27
Lubricants 1020244.00 28726036.74 94.18
Chemicals 444863. 30166909.07 96.68
Fasteners 503360.00 29229396.74 97.91
Safety items(GO5) 369157.80 30536066.87 98.25
Tools and Jigs 101249.33 31259094.50 99.93
EDP 23175.00 31282269.50 100
51
Interpretation:
Items constituting 70% of the total annual consumption by value are classified as A
class items .The items are MECH EQPT Spares Building Material ,Miscellaneous,
Iron & steel The next 20% of the annual consumption value are classified as ‘B’
class items .The items are General Documentation material Bearings.
Lubricants, Electrical spares ,Fasteners ,Chemicals, Instrument spares ,Safety
items ,Fire items and security, lab chem. & apparatus, tools and jigs and EDP.
52
s.no Items Group Wise Cost per Units Annual Rank

1 MECH EQPT Spares 24,613.00 431 10362073..00 1
2 Bearings 16,636.73 104 1730219.92 7
3 Fasteners 4,119.11 111 457221.21 12
4 Lubricants 41,211.76 29 1195141.4 8
5 Tools and jigs 1,112.63 87 96798.81 16
9 Safety Items{GO5} 16,636.73 19 467599.88 11
10 Chemicals 4,119.11 26 594880.00 9
11 Lab chem 2 Apparatus 41,211.76 12 172800.00 15
12 EDP 1,112.63 11 28325.00 17
15 Fuel-4116522 24,613.00 0 - 18
16 General 39,444.18 74 2918869.32 5
17 Miscellaneous 46,178.94 87 4017567.78 4
18 PP Thred-54728 24,19,400.00 0 - 19
53
consumption(Rs)
MECH EQPT Spares 10362073.00 1032073.00 29.62
Miscellaneous 4017567.78 24349679.49 58.11
Iron & steel 4698388.71 2033211.71 69.59
General 2918869.32 27268548.81 77.94
Bearings 1730219.00 30882286.73 88.26
Lubricants 1195141.04 32077427.77 91.68
Chemicals 594880.00 33261454.37 95.06
Fasteners 457221.21 33729050.25 96.40
Safety items(GO5) 467599.88 34186275.46 97.71
Fire items and security 213150.00 34688467371 99.14
Tools and Jigs 96798.81 34958066.52 99.92
EDP 28325.00 34986391.52 100
54
Interpretation:
Items constituting 70% of the total annual consumption by value are classified as A class
items .The items are MECH EQPT Spares Building Material ,Miscellaneous, Iron & steel
The next 20% of the annual consumption value are classified as ‘B’ class items
.The items are General Documentation material Bearings.
Lubricants, Electrical spares ,Fasteners ,Chemicals, Instrument spares ,Safety items
,Fire items and security, lab chem. & apparatus, tools and jigs and EDP.
55
s.no Items Group Wise Cost per unit Units Annual consumption Rank
1 MECH EQPT Spares 24,613.00 577 14447831.00 1
2 Bearings 16,636.73 98 1630399.54 8
3 Fasteners 4,119.11 136 560198.96 13
4 Lubricants 41,211.76 17 700599.92 12
5 Tools and jigs 1,112.63 95 105699.85 17
9 Safety Items{GO5} 16,636.73 56 935199.76 10
10 Chemicals 4,119.11 55 228800.00 14
11 Lab chem & Apparatus 41,211.76 6 288000.00 15
12 EDP 1,112.63 9 10300.00 18
15 Fuel-4116522 24,613.00 114 2810900.00 2
16 General 39,444.18 43 1696099.74 7
17 Miscellaneous 46,178.94 19 877399.86 11
18 PP Thred-54728 24,91,400.00 1 2491400.00 3
56
consumption(Rs)
MECH EQPT Spares 14447831.00 14447831.00 42.70
Fuels-4116522 2810900.00 17258731.00 51.00
PP Thread-54728 2591400.00 19750131.00 58.36
Building materiel 1965700.00 21715831.00 64.17
Iron and steel 1838499.93 25499590.48 75.35
General 1696099.74 27195630.22 80.37
Bearings 1630399.54 28826029.41 85.18
Safety items(GO5) 935199.76 30926526.17 91.39
Miscellaneous 877399.86 31803926.30 93.98
Lubricants 700599.92 32504525.95 96.05
Fasteners 560198.96 33064724.91 97.71
Chemicals 228800.00 33293524.91 98.39
Lab chem.& Apparatus 288000.0 33581524.91 99.24
Tools and jigs 105699.85 33829324.76 99.97
EDP 10300.00 33839624.76 100
57
Interpretation:
Items constituting 70% of the total annual consumption by value are classified as A
class items .The items are MECH EQPT Spares Fules-4116522,pp Thread-54728,
Building Material , Electrical spares
The next 20% of the annual consumption value are classified as ‘B’ class
items .The items are Iron and steel General Bearings, Instruments spares.
Miscellaneous, Lubricants, Fasteners ,Chemicals, Fire items and security, lab chem. &
apparatus, tools and jigs and EDP.
XYZ Analysis for stock for the year 2012-13
S.no Department No value No Value No Value No Value

of of of of
items items items items
58
1 Mechanical(Mech- 208 91.316 429 26.137 1653 13.059 2290 130.512
Mspar)
2 Bearings 8 4.278 11 1.431 41 0.651 60 6.359
3 Hard 42 2.317 56 0.667 141 0.338 239 3.332
4 Lube 6 2.493 5 0.975 6 0.424 17 3.892
5 Tools 17 0.579 25 0.168 51 0.086 93 0.833
6 Electrical(Elec+int) 152 17.477 212 5.015 509 2.502 873 24.994
7 Instrumentation 135 23.698 183 6.759 444 3.402 762 33.858
(inspar+inst)
8 Civil 19 3.773 15 1.120 42 0.550 76 5.443
9 Safety 9 2.373 12 0.677 28 0.366 49 3.416
10 Operations(chem.) 2 1.094 2 0.351 6 0.241 10 1.685
11 Lab spares-lspar 0 0.000 0 0.000 0 0.000 0 0.000
12 EDP 4 0.318 3 0.138 5 0.056 12 0.512
13 Documentation 0 0 1 0.041 3 0.007 4 0.048
14 Security and Fire 3 0.545 3 0.247 14 0.113 20 0.905
15 HSD(811602140) - - - - 1 2.536 1 2.536
16 General 4 0.416 6 0.149 25 0.071 35 0.636
17 Miscellaneous(p 8 0.407 11 0.138 17 0.063 36 0.608

&A items)
18 PP Thread and 1 6.467 - - - - 1 6.467

Fraw
Total 618 157.550 974 44.011 2986 24.484 4578 226.024
59
S.no Department No of Valu.e No of Value No of Value No of value
1 Mechanical(Mech- 218 101.276 436 29.025 1764 14.481 2418 21.721

Mspar)
2 Bearings 8 3.868 13 1.092 36 0.602 57 0.963
3 Hard 42 2.914 49 0.848 141 0.429 239 0.729
4 Lube 5 2.234 3 0.555 6 0.469 14 0.844
5 Tools 22 0.654 25 0.189 45 0.097 92 0.203


(inspar+inst)
8 Civil 4 1.103 5 0.143 14 0.193 23 0.289
9 Safety 12 2.348 13 0.672 28 0.355 53 0.71
10 Operations(chem.) 1 0.689 3 0.225 4 0.115 8 0.23
11 Lab spares-lspar 0 0.000 0 0.00 0 0.00 0 0.00
12 EDP 4 0.258 2 0.082 5 0.053 11 0.108
13 Documentation 1 0.003 1 0.002 1 0.002 3 0.006
15 HSD(811602140) - - - - 1 2.388 1 2.388
16 General 0 0.000 5 8.761 57 1.043 62 1.251
17 Miscellaneous(p &A 8 0.259 9 0.082 14 0.044 31 0.101

items)
18 PP Thread and 1 - - - - - 1 5.193

Fraw (810201107)
60
19 De-foamer 10 0.570 12 0.570 14 0.274 36 0.685
Total 602 167.158 972 55.405 3138 26.930 4712 249.493
61
S.no Department No of value No of Value No of Value No of value

1 Mechanical(Mech- 232 102.220 426 29.244 1761 14.624 2374 146.088

Mspar)
2 Bearings 16 .825 16 .533 58 1.297 90 12.655
3 Hard 25 3.602 41 1.027 145 0.518 211 5.147
4 Lube 4 3.470 3 1.092 6 0.626 13 5.189
5 Tools 18 0.358 20 0.103 36 0.055 74 0.515
8 Civil 4 1.277 5 0.456 9 0.230 18 1.962
9 Safety 14 3.332 15 0.941 31 0.496 60 4.769
10 Operations(chem.) 3 1.383 2 0.399 4 0.278 9 2.060
11 Lab spares-lspar 0 0.000 0 0.000 1 0.025 1 0.025
12 EDP 2 0.133 2 0.082 3 0.034 7 0.248
13 Documentation 0 0.000 1 0.057 3 0.007 4 0.064
15 HSD(811602140) 1 1.948 - - - - 1 1.148
16 General 12 1.541 12 0.448 42 0.230 66 2.219
17 Miscellaneous(p &A 6 0.302 9 0.093 15 0.047 30 0.442

items)
18 PP Thread and Fraw 1 7.087 - - - - 1 7.087

(810201107)
19 De-foamer 13 2.128 12 0.610 17 0.237 42 3.065
Total 630 176.922 938 48.358 3005 24.434 4573 249.714

62
S.no Department No. of Value No .of Value No.of Value No.of Value
Items Items Items Items
1 Mech (Mech- 208 316 426 .244 64 14.481 3049 23.56

Mspar)
2 Bearings 37 15.68 48 4.63 138 2.28 223 22.59
3 Hard 42 2.914 49 0.848 148 0.429 239 0.729
4 Lube 6 2.493 5 0.975 6 0.424 17 3.892
5 Tools 18 0.358 20 0.103 36 0.055 74 0.515
6 Electrical 131 18.476 201 5.278 508 2.650 840 4.505

(Elec+Int)
8 Civil(Const) 4 1.277 5 0.455 9 0.130 18 1.962
9 Safety 12 2.348 13 0.672 28 0.355 53 0.71
10 Operations 3 1.13 4 0.48 3 0.18 10 1.79

(Chem)
11 Lab spares- 0 0.00 0 0.00 1 0.025 1 0.025

Lspar
12 EDP 4 0.318 3 0.138 5 0.056 12 0.512
13 Documentation 3 0.14 8 0.05 17 0.02 28 0.21
14 Security and 4 0.322 5 0.123 13 0.053 22 0.498

Fire
15 HSD 1 2.27 - - - - 1 2.536

(811602140)
16 General 12 1.541 12 0.448 42 0.230 46 2.219
17 Miscellaneous 8 0.259 9 0.082 14 0.044 31 0.101

(P&A Items)
18 PP Thread 1 1.56 0 0 0 0 1 1.56

(8102101107)
19 De-Foamer 10 0.572 12 0.610 14 0.374 36 0.685
Total 687 408.358 1103 26.836 1807 27.616 5928 129.587
63
XYZ Analysis of the company:
Inventory holding of each project will be analyzed with reference to
value of the holding against each item.
So according to the stock as on march 09 these were around 4,573 spares
which were worth about 2.50 crores so after XYZ analysis around 630 items of worth
around 1.76 crores were classified as ‘X’ class similarly there are around 938 items in
‘Y’ class which contributes to value of 2.4 crores .
Simiilarly according to the as on march 08 under X class these were 630
items worth of around 1.76 crores where as there were 938 Y class items contributed
to A value of around 4,38 crores and 3005 Z class items .This contributed to 2.44
crores
First in First out:
Some items get expired beyond a particular time limit .so these items are
to be used before they get expired so such items are controlled using FIFO for
effective utilization company ulitizes this technique for almost all the spares available
in the stock.
64
SUMMARY AND SUGGESTIONS
Summary:
The existence of a need based philosophy like marketing resides with the truth
of self sufficiency. In other words, as on individuals is self sufficient or capable of
satisfying all his / her needs with depending on any one, it’s the same in the case in
the country. No country can live in a complete isolation. Whenever inequality arises
there an opportunity is created for the resourceful person /country to encase the
opportunity.
Inventory Management is to know the performance of business activities that

direct the flow of a company’s goods and services to consumers or users. Inventory
Management plays a vital role in the growth of company. This study makes us to
understand the inventory management concepts which are already studied
theoretically. This study brings us a practical knowledge apart from the book
knowledge. This study also makes us to aware of different inventory methods
followed by the organization in order to meet the demands of the product in the
market.
The need and importance of inventory varies in direct proportion to the idle
time cost of men and machinery and urgency of requirement. If men and machinery in
the factory could, wait and so could customers, materials would not lie in want for
then and no inventories need to be carried. But it is highly uneconomical to keep men
and machinery waiting and the requirements of modern life are so urgent that cannot
wait for materials to arrive after the need for them has arisen. Hence, the organization
needs to carry the inventories.
65
FINDINGS
 ABC Analysis reveals consumption of product ‘a’ is very high when

compared to product ‘B’ and ‘C’ from 2011 to end of the study period.
 The consumption value of product ‘A’ has increased tremendously.
 In 2012 due to decrease in the value of product ‘A’ the consumption value
has decreased.
 Due to increase in demand for their products the maximum stock level is in the
increasing trend.
 The implementation of 1+2 plan helps the company for cost cutting.
 The raw material turnover ratio is very high and decreased in the later years
due to effective control.
 The finished goods turnover ratio is high is shows the efficiency of
business operations.
 Inventory turnover period is decreasing which means the stock remains in the
store for lesser period.
 The companies by strictly following inventory management techniques like
EOQ, ABC, MRP analysis they can increase its profits.
 By supplying the finished products at reasonable prices to the customers and
thus increase its period of existence in the market.
66
SUGGESTIONS
 In most recent years. CORAMANDEL FERTILISERS Limited has worked to

its full capacity. This reflects that the efficiency of men and machines in the
organization. A company of this nature can multiply its profits by increasing
in Inventory Control Management.
 The proportion of inventory to the total current assets has not been showing a
consistent increase. The size of inventory should be increased so as to meet the
demand.
 The size of Inventory Control Management, which has shown tremendous
increase during first two years, has remained static thereafter. Between the
inventories on current assets, is not more profitable.
 Thought the sale of CORAMANDEL FERTILISERS is showing an increasing
trend, the profits have not registered an increasing trend as well. This is due to
the increase in the cost of production. Therefore, company should take care of
controlling cost of production.
 The company must concentrate on new and improved technology to increase
production and there by decrease cost of production.
 The company should aim at minimizing cost by implementing strict cost
control and maintain cost records for each department to identify the risk in
controllable costs
 More Innovation techniques are to be introduced to meet an increased demand
in the market.
 It is suggested that the inventory holding period is to be reduced by increasing

Inventory Turnover Ratio (By increasing sales).
 It is suggested to calculate EOQ for items of each raw material and maintain
the ordering cost and carrying cost profile for effective management of
inventory.
67
CONCLUSION
There has been a phenomenon growth in the financial position in company over
the last five years which has been the result of the reforms and liberalization in the
economy. This increase also let to serve competition among the companies .these
companies have properly designing the investment and lending policies. Otherwise they
have to face sever financial troubles. In the light of competition these companies have to
plan and implement suitable, appropriate policies in order to strengthen their financial
variability which is seen through the financial statement and its analysis.
The financial charges of CORAMANDEL FERTILISERS are comparatively

lower and it has a decreasing trend, which is not a healthy sign to the company. The
company efficiency in turning its inventory is increasing sales is good, the years
holding of all types of inventory is decreasing. There is a positive trend.
68
BIBILOGRAPHY
REFERENCES
1. Financial Management : I. M. Pandey
2. Financial Management: Khan & Jain
3. Financial management theory concepts and problems incorporating the emerging

trends in Indian capital market: R.P. RUSTAGI
4. Annual reports in KPR Fertilizers.
Web site:
www.google.com
www.wikipedia.com
www.coramandel.in
69

Inventory MGMT in Coromandal

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INTRODUCTION

Financial management is mainly concerned with the proper mgt of finance

Financial Management Levels:

Broadly speaking, the process of financial management takes place at two

Financial managers aim to boost the levels of resources at their disposal.

A) Financial Analysis, Planning and Control

 Analysis of financial condition and performance

 Identification of sources of finance and determination of financing mix.

 Cultivating sources of funds and raising funds

 Disposition of profits between dividends and retained Earnings.

 Management of current Assets

Importance of Financial Management

Some important functions of Financial Management

 Financial planning and successful promotion of an enterprise.

Functions of the Financial System:

 It provides a payment system for the exchange of goods and services.

 It enables the pooling of funds for undertaking large-scale enterprises.

 It provides a mechanism for spatial and temporal transfer of resources.

 It provides a way for managing uncertainty and controlling Risk.

 It generates information that helps in coordinating

 Decentralized decision making.

Entails planning for the future of a person or a business enterprise to ensure a

A financial manager looks at the available data to judge the performance of

 To understand the concept of inventory management in general and to know

 To know the profile of Coromandel International Ltd located at

 To learn the CIL is organizing its inventory management methods and

 To give suggestions if necessary for the better improvement of inventory

It consists of information disclosed by the financial heads of various authorities

It consists of information obtained from annual reports. Balance-sheet and other

1. Due to the time constraints it is difficult to study the performance of a big

A) FERTILIZER INDUSTRY AT NATIONAL LEVEL

Indian economy is presently an under developed economy. Almost all important

India has made substantial development in agriculture since independence in terms of

GROWTH IN FOOD GRAIN PRODUCTION

MEANING AND ESSENTIAL ELEMENTS:

Fertilizer is defined as “any material, organic or inorganic, natural or synthetic,

NEED TO PRODUCE MORE FERTILIZERS IN INDIA:

FACTORS AFFECTING FERTILIZER CONSUMPTION:

HISTORY OF INDIAN FERTILIZER INDUSTRY:

ROLE OF FERTILIZERS IN AGRICULTURS WITH REFERENCE TO INDIAN

Agriculture is a very vital sector of India’s economy. It accounts for 32% of

India has different kinds of soils and agro-climatic regions. Centuries of

The consumption of fertilizers is directly related to the availability of subsoil and

The consumption of fertilizers is not evenly distributed. The imbalance has to be

In case of phosphate fertilizer which depends wholly on imported raw material

Fertilizer Association of India welcomed the suggestions to bring the price

FERTILIZER MOVEMENT CONTROL ORDER, 1973

This was promulgated under Sec-3 or ECA to ensure equitable distribution of

FERTILIZER CONTROL ORDER, 1985(FCO)

With a view to ensure that the quality of fertilizers is checked at

STANDARD OF WEIGHTS & MEASURES (PACKED COMMODITIES) RULES,

Fertilizer subsidy is one of the important subsides related to agriculture sector in

COMPANY PROFILE OF COROMANDEL FERTILIZERS

Coromandel International Limited is in the business segments of Fertilizers, Specialty

In its Endeavour to be a complete plant nutrition solutions company, Coromandel has

To be the leader in the phosphate fertilizer industry producing high quality

1. High quality products and brand image

2. Modern, cost effective and energy efficient manufacturing facility