TABLE OF CONTENETS CONTENETS NAME OF CHAPTERS PAGE NO CHAPTER-1 Introduction about the Industry and Company profile 1-34 CHAPTER-2 Conceptual background and Literature review 35-57 CHAPTER-3 Research Design 58-74 CHAPTER-4 Analysis and Interpretation 76-84 CHAPTER-5 Findings

TABLE OF CONTENETS CONTENETS NAME OF CHAPTERS PAGE NO CHAPTER-1 Introduction about the Industry and Company profile 1-34 CHAPTER-2 Conceptual background and Literature review 35-57 CHAPTER-3 Research Design 58-74 CHAPTER-4 Analysis and Interpretation 76-84 CHAPTER-5 Findings,Conclusion and Suggetions 85-96 Bibilography CHAPTER-1 INTRODUCTION INTRODUCTION OF INDUSTRY PROFILE: The Indian cement industry is the second largest cement producer in the world with an installed capacity of 144 million tonnes. The industry has undergone rapid technological upgradation and vibrant growth during the last two decades, and some of the plants can be compared in every respect with the best operating plants in the world. The industry is highly energy intensive and the energy bill in some at the plants is as high as 60% of cement manufacturing cost. Although the newer plants are equipped, there exists, substantial scope for reduction in the energy consumption in many of the older plants adopting energy cement consumption year.

Cement industry is also plays a significant role, in the rapid growth and development of a country because cement is a fundamental requirement.The impact of economic factors like the supply of raw materials, cost of labour, cost of infrastructure and economic of location have all determine the growth and development of Indian industries but one major factor has always been the profit ent of all constructions activities. Cement is used in housing, dams, bridges, industrial construction, roads etc, so cement is basic material which is used in all types of constructions. The impact of economic factors like the supply of raw materials,cost of labour, cost of infrastructure and economic of location have all determine the growth anddevelopment of Indian industries but one major factor has always been the profit incentive. Cement remained under price and distribution control during the period 1939 – 45.

After there world war – 2 arrangements was made between cement manufactures reading price and distribution of cement of avoid rate – war. In order to boost up sale of cement and concrete association of India was formed. During in the year 1947 India standard specification for indigenous cement has applied in place of British standard specification. All cement manufactures were obliged to maintain quality of cement as per the standard laid down in the specification. Norms for 1.

day 3 day’s strength as well as setting time was safeguard the interest of the customer In 1956. Cement control was promulgated and price and distributed of cement was invested with standard trading corporation and this arrangement continued up to 1966. For govt. And function of earlier being performed by STC was taken by cement allocation and co-ordination organization Govt.

Again brought under control which lasted up to 28th Feb. 1989. It will thus be seen from the above that from the beginning cement industry as whole barring for very short period, was constantly under the control by the Govt. Cement manufacturing units were just carrying out the instruction of the Govt.

Origin of the cement: Industry is a massive employment agent providing opportunities broad basing entrepreneurship and securing distribution of economic wealth. Industry occupies a place of importance in the economy as potential caretakers of economic resources in particular labours resources as they provide employment for substantial workforce. They have strategic role to play in the economic development of country and remain important in the economies of the more highly industrialized countries. Cement plays an important role in the economic development of the country.

Cement is being used from more than 150 years of construction. The cement consumption determines the infrastructure strength and development of the nation. The history of cement industry in India started when the first plant was set up in 1904 at Chennai (Madras) in their earlier stage. Now a day’s cement has become the essential unit for construction works.

The cement industries have been growing with global competence for quality and satisfaction of the product. In our industrial Portland cement is most widely used as a non metallic construction material. The history of cement can be traced to the days of Babylonian and Assyria. In earlier days, the use of cement was made by Egyptians, by mixing an impure form of gypsum with water, the resulting paste was used as a bonding agent between the stone blocks of pyramids. The Romans were the first to use the limestone, however there crushed and burned before mixing with water and used as mortar between bricks and stones. Although cement by taking limestone, containing a proportion of clay and Joseph Asp din was the first to patent Portland cement in the year 1824.

In India first cement industry was established in Chennai in 1904. The growth continued in 1936 eleven companies emerged to form associated cement companies (ACC). By 1947 India had 23 cement plants with a capacity of 2.2 million tons per annum to meet the ever increasing demand of cement. Growth and development of Industry: Cement industry have contributed to the growth of manufacturing sector, housing sector, service sector, etc.

Cement industry plays a vital role in the resurgence of the economy. They are not only instruments of change but also vehicle of growth and diversification. The growth of cement industry in India continues to be positive. The installed capacity is about 150 million tonnes. The demand of cement grew by about 8% during the year 2004 – 05.

Indian cement industry has brighter prospects for long term high growth rate. India has a great competitive advantage in cement manufacturing due to its vast deposits of quality limestone spread all over the country, abundance of other inputs and cost skilled cement industry in India is the third largest in the world after china.The consumption rate is very nearer to the production rate. Lot of restructuring andconsolidation took place in the industry. LAFAREGE, French multinational entered the Indian cement market by acquired Dharani cement, shree Digvijay cement and cement unit of Indian Rayon, and Indian cement acquired Rassi cement and L & T acquired Narmada cement. Cement industry is one of the key industries in India.

It plays a dominant role in the national economy. Form the point of view of economic development of the country, Cement industry ranks second very next to the Iron and steel industry. Cement is indispensable in building and construction works. The production and consumption of cement to a large extent, indicates a country’s progress. In a developing country like India the need for a well established cement industry is of paramount importance.The Indian cement industry continues to suffer from excessive production capacity a time when demand growth continues to be sluggish.

The industry remains highly fragmented and profit have been impaired by a series of debilitating price wars as well as from steadily rising costs. The recent arrival of Lafarge may herald some much needed industry consolidation. Meanwhile cement capacity levels continue to be swollen by a sizeable new building programmed. Population: 935.7 Density: 314 Area: 279190 Capital city: New Delhi GNP Per Capita : US$310 Urbanization : 26% Per capita cement consumption: 79Kg Official Language: Hindi ; English Currency : Rupee Players of Cement industry in india: The players of cement industry contribute in economical growth of India. These top cements are exported to overseas and thus,foreign money comes to India andthese top cement companies contribute in financial growth of India .The rank of cement companies is given by Economic Times among the top 500 companies of world.

The ranking of cement companies along with its turnover and its profit figures are also shown in the table. As per this table Ultratech, ACC, and Ambuja are the top players of cement industry. Cement productions companies are many in counts but there are very few companies which cameinto fortune 500 companies. lists of top players of cement industry are- • Ultratech Cement • ACC Cement • Ambuja Cement • Shree Cement • India Cement • Prism Cement • Rain Cement • J.KCement • Madras Cement Ltd • Birla Cement CEMENT CORPORATION OF INDIA: Cement Corporation Of India Limited (CCI) is a public- sector undertaking of the government of India. The company was incorporated as a wholly government-owned corporation on Janauary 18, 1965, with the objective of setting up cement units in public sector to help achieve self –sufficiency in cement production in the country.

CCI is based in New Delhi . The corporation manufactures various types of cements, such as Portland pozzolana cement(ppc), Portland slag cement(PSC), and ordinary Portland cement(OPC), of varying grades – 33,43,53, and 53S .CCI currently has 10 opertating units spread over seven Indian states and union territories, with a total annual installed capacity of 38.48 lakh MT. TYPES CEMENT: Cement means a substance, which posses a very adhesive and cohesive property which makes it possible to bond with other materials to form a compact pass. 1.Ordinary Portland cement (OPC) 2.

Portland pozzolona cement (PPC) 3. Portland blast furnace slag cement 4. White cement 5. Coloured Cement 6. Oil Well Cement 7. Low Heat Cement Cement: Cement is a generic for powdered materials which initially have plastic flow whenmixed with water or other liquid, but have a solid structure in several hours with varying degree of strength ; bonding properties which continues to improve with time, the most common is the Portland cement which is the basis for a number cement products.

Specially, Portland cement is defined as finally ground calcium aluminates andsilicates of varying compositions which hydrate. When mixed with water to form good rigid continues structure with good compressive strength. The raw materials used in the manufacturing of cement are Main raw material is Limestone Additives. 1. Bauxite 2.

Hematite 3. Laterite 4. Gypsum 5. Fly ash Chemical Composition of Cement: Silica, lime and alumina are three basic raw materials of cement. Iron oxide, Sulphuroxide and other alkali are present in cement, but to very small proportion. All these materials are mixed and then burnt at clinker temperature of about 1400 degree centigrade to 1500 degree centigrade.

Clinker is lastly made fine powder to obtain the cement. ORGANIZATION PROFILE ASSOCIATED CEMENT COMPNAY AT WADI(ACC) Introduction of ACC Limited: ACC Limited is India’s foremost cement manufacturer with a countrywide network of factories and marketing offices. Established in 1936, ACC has been a pioneer and trend-setter in cement and concrete technology. Among the first companies in India to include commitment to environment protection as a corporate objective, ACC has won accolades for environment friendly measures taken at its plants and mines, and has also been felicitated for its acts of good corporate citizenship.

ACC is the most preferred cement brand name in India. ACC is now part of the worldwide Holcim Group. In the 70 years of its existence ,ACC has been a pioneer in the manufacture of cement and concrete and a trendsetter in many areas of cement and concrete technology including improvements in raw material utilization, process improvement, energy conservation and development of high performance concretes. F. E.

Dinshaw – the founder of ACC HISTORY OF ACC: ACC was formed in 1936 when ten existing cement companies came together under one umbrella in a historic merger – the country’s first notable merger at a time when the term mergers and aqusitions was not even coined. The history of ACC spans a wide canavas beginning with lonely struggle of its pioneer F E DIN SHAW and other Indian entrepreneur like him who founded the Indian cement industry. Their efforts to face competition for survival in small but aggressive market mingle with the stirring of countrys nationalist pride that touched all walks of life – including trade, commerce and business. The first success came towards co-operation in the country’s young cement industry and culminated in the historic merger of ten companies to form a cement giant. These companies belonged to four prominent business groups – TATAS, KHATAUS,KILLICK NIXON AND F E DIN SHAW groups.

ACC was formally established on August 1, 1936.sadly, F E Din shaw, the man recognized as the founder of ACC,died in janauary 1936.just months before his dream could be realized. ACC stands out as the most unique and successful merger in Indian business history, in which the distinct identities of the constituents companies were melded into cohesive organization. The use of the plural in ACC’s full name. The Associated cement companies Limited, itself indicates the companies origins from merger. Many years later, some stockbrokers in the countrys leading stock exchanges still refer to this company simply as ‘The Merger’. The ACC Board comprises of 13 persons.

These include executive, non executive, and nominee director, This group is responsible for determining the objectives and board policies of the company- consistent with the company objective of enhancing long term share holder value. BOARD OF DIRECTORS: Mr.N..S.Sekhsaria Mr. Jan Jenisch Mr.Neeraj Akhoury Mr.Martin Krienegner Mr. shailesh haribhakti Chairman Deputy chairman MD ; CEO Additional director Independent director Mr.sushil kumar roongta Mr.ashwin dani Mr.Farrokh.k.kavaran Mr.vijaykumar Sharma Mr.Arunkumar gandhi Independent director Independent director Independent director non independent director independent director Mrs. Falguni Nayar Mr. christof Hassig Independent director W.E.F EXECUTIVE COMMITTEE:- Mr.

Neeraj Akhiury Mr. Sunil.k.Nayak Mr. Philip Mathew Mr. Beharam Sherdiwala Mr. Procyon Mukharjee MD ; CEO chief financial officer manufacturing officer chief people officer chief procurement officer A Strategic Alliance: The house of Tatas was intimately associated with the heritage and history of ACC, right form its formation in 1936 up to 2000. The Tata group sold all 14.45% of its shareholding in ACC in three stages to subsidiary companies of Gujarat Ambuja Cements Ltd,(GACL), who are now the largest single shareholder in ACC.

This enable ACCto enter into strategic alliance with GACL; a company reputed for its brand image and cost leadership in the cement industry. HOLCIM- A NEW PARTNERSHIP: A new association was forged between ACC and The Holcim group of Switzerland in 2005. In janauary 2005, Holcim announced its plants to enter into long – term alliances with Ambuja Group by acquiring a majority stake in Ambuja Cements India Ltd.(ACIL), which at the time held 13.8% of total equity shares in ACC. Holcim simultaneously announced its bid to make an open offer to ACC shareholders, through Holdcem Cement Pvt.Ltd.

and ACIL, to acquire a majority shareholding in ACC. Following which the shareholding of ACIL increased to 34.69% to equity share capital of ACC. Consequently , ACIL has filed declaration indicating their shareholding and declaring itself as a promoter of ACC. The group has its headquarter in Switzerland with world wide operations spread across more than 70 countries. Considering the formidable global presence of holcim and its excellence reputation, the board of ACC has welcomed this new association.

CORPORATE PROFILE: ACC (ACC Limited) is India’s foremost manufacturer of cement and concrete. ACC’s operations are spread throughout the country with 16 modern cement factories, more than 40 Ready mix concrete plants, 21 sales offices, and several zonal offices. It has a workforce of about 9,000 persons and a countrywide distribution network of over 9,000 dealers. Since inception in 1936, the company has been a trendsetter and important benchmark for the cement industry in many areas of cement and concrete technology.

ACC has a unique track record of innovative research, product development and specialized consultancy services. The company’s various manufacturing units are backed by a central technology support services centre – the only one of its kind in the Indian cement industry. ACC has rich experience in mining, being the largest user of limestone. As the largest cement producer in India, it is one of the biggest customers of the domestic coal industry, of Indian Railways, and a considerable user of the country’s road transport network services for inward and outward movement of materials and products.

Among the first companies in India to include commitment to environmental protection as one of its corporate objectives, the company installed sophisticated pollution control equipment as far back as 1966, long before pollution control laws came into existence. Today each of its cement plants has state-of-the art pollution control equipment and device. VISSION OF ACC: To be one of the most respected companies in India; recognized for challenging conventions and delivering on our promises. MISSION OF ACC: Leadership : Maintain our leadership of the Indian cement industry through the continuous modernization and expansion of our manufacturing facilities and activities, and through the establishment of a wide and efficient marketing network.

Profitability: Achieve a fair and reasonable return on capital by promoting productivity throughout the company. Growth: Ensure a steady growth of business by strengthening our position in the cement sector. Quality: Maintain the high quality of our products and services and ensure their supply at fair prices. Equity: Promote and maintain fair industrial relations and an environment for the effective involvement, welfare and development of staff at all levels. Pioneering: Promote research and development efforts in the areas of product development and energy, and fuel conservation, and to innovate and optimize productivity.

Responsibility: Fulfill our obligations to society, specifically in the areas of integrated rural development and in safeguarding the environment and natural ecological balance. Achivement of ACC.Ltd.: • In 1936 The Associated Cement Companies Limited incorporated on August 1. • In 1947 india’s first entirely indigeneous cement plant installed at chaibasa. • In 1955 ACC sindri uses waste material – calcium carbonate sludge –from fertilizer factory at sindri to make cement.

• In 1956 Bulk cement depot established at Okhla,Delhi. • In 1961 blast furnace slag from TISCO used at ACC chaibasa to manufacture Portland slag cement. • In 1961 oilwell cement manufactured at ACC Shahabad for cementation of oils wells up to adepth of 6,000 feet. • In 1965 manufacture of Portland pozzolana cement using naturally available materials.An eco friendly.

• In 1978 introduction of the energy efficient pre- calcinations technology for the first time in india. • In 1982 commissioning of the first 1 MTPA plant in the country at wadi, Karnataka. • In 1984 ACC achieves a breakthrough in import substitution by developing and supplying a special G type of oil well cement to ONGC. • IN 1987 ACC develops a new binder, working at sub-zero temperature, which is successfully used in the Indian expedition to Antractica. • In 1992 incorporation of bulk cement corporation of india, a JV with the government of india.

• In 1993 commercial manufacture of ready- mixed concrete at Mumbai. • In 2001 commissioning of the new wadi plant of 2.6 MTPA capacity in Karnataka, the largest in india, and among the largest sized kilns in the world . AWARDS OF ACC: • IMC Ramakrishna Bajaj National Quality Award – Gagal wins commendation certificate and new wadi plant wins special award performance excellence in the manufacturing sector, 2007. • National Award for outstanding performance in promoting rural and agricultural development- by ASSOCHAM. • Sword Of Honour- by British Safety Council, United Kingdom for Excellence in safety performance.

• Indira Priyadarshini Vrikshamitra Award – by The Ministry of Environment and Forest for ‘extraordinary work’ carried out in the area if afforestation. • FICCI Award- for innovative measures for control of pollution, waste management & conservation of mineral resources in mines and plant. • Subh karan sarawagi Environment Award- by The federation of Indian Mineral industries for Environmentprotection measures. • Drona Trophy- by Indian Bureau Of Mines for extra ordinary efforts in protection of environment and mineral conservation in the large mechanized miner sector. • Indo German Greentech Environment Excellence Award • Golden peacock Environment Management Special Award- for outstanding efforts in environment management in the large manufacturing sector.

• Indira Gandhi Memorial National Award- for excellence performance in prevention of pollution and ecological development. • Excellence in Management of Health, Safety and Environment- certificate of Merit by Indian Chemical Manufactures Association. • Vishwakarama Rashtriya Puraskar trophy – for outstanding performance in safety and mine working. • Good Corporate Citizen Award- by PHD Chamber of Commerce and Industry. • Jamnalal Balaji Uchit Vyavahar Puraskar – certificate of Merit by Council for Fair .

PRODUCTS /SERVICES PROFILE: 1. Portland cement: a. 43 grade cement (opc):- ACC Cement is the most commonly used cement in all constructions including plain and reinforced cement concrete, brick and stone masonry, floors and plastering. It is also used in the finishing of all types of buildings, bridges, culverts, roads, water retaining structures, etc. What is more, it surpasses BIS Specifications (IS 8112-1989 for 43 grade OPC) on compressive strength levels. ACC Cement is marketed in specially designed 50 kg bags.

b. 53 grade cement(opc):- This is an Ordinary Portland Cement which surpasses the requirements of IS: 12269-53 Grade. It is produced from high quality clinker ground with high purity gypsum.ACC 53 Grade OPC provides high strength and durability to structures because of its optimum particle size distribution, superior crystalline structure and balanced phase composition.It is available in specially designed 50-kg bags. 2. Blended cement:- a. Fly ash based Portland pozzolana cement:- This is a special blended cement, produced by inter-grinding higher strength Ordinary Portland Cement clinker with high quality processed fly ash – based on norms set by the company’s R;D division. This unique, value-added product has hydraulic binding properties not found in ordinary cements.It is available in specially designed 50-kg bags. b. Portland slag cement:- This is a slag-based blended cement that imparts strength and durability to all structures.

It is manufactured by blending and inter-grinding OPC clinker and granulated slag in suitable proportions as per our norms of consistent quality. PSC has many superior performance characteristics which give it certain extra advantages when compared to Ordinary Portland Cement.It is available in specially designed 50-kg bags. 2.Preimium cement:- A..ACC GOLD: ACC Gold is the only one of its kind, specially formulated cement with high quality water repellent properties. ACC Gold is a result of minutely controlled process changes under sustainable environment along with adjustments in the input raw material dosage in order to get the desired water repellent properties. B.CONCRETE +: . Concrete+ is the latest offering from ACC, India’s leading manufacturer of cement and ready mix concrete.

Faster, Stronger, Forever is our promise and Concrete+ delivers. The product is designed to achieve required strength and better workability for a better and cohesive concrete. Concrete+ is produced by inter-grinding high strength cement clinker with high quality processed fly ash. This product utilises fly ash (a hazardous industrial waste) to help conserve natural resources, thus making it an eco-friendly product. Concrete+ comes in an attractive 50 kg tamper proof bag.

C.ACC FOUNDATION TO ROOF(F2R): A product manufactured at a world class manufacturing facility, designed to withstand the attack of salt and toxins. The use of blast furnace slag, which is a byproduct of the Steel industry, as a Supplementary Cementitious material, enhances the durability of the structures and helps building long lasting homes D.ACC HIGH PERFORMANCE CEMENT: ACC High Performance Cement (HPC) is an engineered slag cement with specialised properties for better workability and cohesive mortar mix in concrete. This increases permeability, resistance to sulphate and chlorides, protects reinforcement against corrosion, reduces heat of hydration resulting in less chances for thermal crack formation. It provides a strong impermeable Cement Paste Matrix. This brand of cement is extensively used to produce high grade concrete, thus rendering concrete structures durable, long lasting and environment-friendly.

E. ACC SURAKSHA: ACC Suraksha is developed through extensive research and is manufactured with the latest technology in state-of- the-art cement plants. This variety of cement requires less water, provides dense and impermeable concrete which increases the long term strength of the structure. ACC Suraksha can be handled without segregation. It provides high strength concrete resulting in strong, sturdy and eco-friendly constructions. 3. Bulk cement: ACC – in a joint venture with the government of India – has set up the most sophisticated bulk unloading terminal at Kalamboli, Navi Mumbai, to bring its cement from the ACC plant at Wadi in Karnataka.

The terminal at Kalamboli has three 5000-tonne-capacity silos to store cement which is transported in specially designed railway wagons. The company has its own fleet of 15-tonne road-bulkers in which cement is then brought to the end-user’s construction site. The terminal has three modes of evacuation: bulk tanker trucks, jumbo bags (one and 1.5 tonnes), and 50 kg bags. Mechanized loading and unloading of cement reduces manual intervention to the barest minimum. The other features of this project include 125 wholly owned railway wagons which ensure that the manual intervention for loading and unloading of cement is minimal.

The cement, until it reaches the terminal and the customer, is untouched by hand. The terminal has three modes of evacuation, namely in Bulk tanker trucks, in Jumbo Bags (1 tonne and 1.5 tonne) and traditional bags of 50 and 25 kgs. Cement is now delivered by weight, duly weighed on electronic weighbridges. The cement godown for the storage of bags, has virtually become part of history. Instead you have tubular steel silos, which take up much lower space and at the same time are designed to ensure free flowing discharge of the cement.

The dust collectors installed on the silos ensure a pollution free environment. The mechanization of the unloading process, enables the total quantity of cement (15 tonnes) to be unloaded into the site silo in 25 minutes flat. Cement is now delivered just on time. A well-equipped laboratory ensures that the testing is carried out scientifically to comply with all4. cement quality norms. The site silos which are a must at the customers sites, can be provided at mutually agreed terms, eliminates a major cause for concern for the end-user.

Pilferage is also made impossible. 4. READY MIXED CONCRETE: ACC’s pioneering efforts in introducing Ready Mixed Concrete (RMX) coupled with the promotion of bulk cement handling facilities have been responsible for redefining the pace and quality of construction activity in metropolitan cities and in mega infrastructure projects. Small building projects and individual home builders seeking high levels of quality assurance can also now usher in the same sophistication and value addition into their construction as some of India’s mega projects using ACC RMX- at virtually no extra cost. 5.READY MIXED CONCRETE VALUE ADDED PRODUCTS: We were the first to introduce Ready Mixed Concrete in India, but our pioneering efforts do not stop there. The quest for customer excellence motivates Ready Mixed Concrete to engage in a continuous process of product development that is customer oriented leading to the introduction of a host of new products, services and solutions.Our product range at ACC Ready Mixed Concrete provides one stop solutions from small basic requirements to higher grades of concrete to build the country’s tallest structures.ACC Ready Mixed Concrete is armed with a wide portfolio of new Value Added Products Solutions for different applications, all tailored to meet specific customer requirements.What’s more we have the backing of the company’s vast and competent cement sales network which can be leveraged to target the retail segment.

COMPETITORS INFORMATION: ? Ambuja cements ? Andhra cement ? Barak vally cement ? Birla cement ? Burnpur cement ? Dalmia cement ? Guj sidhee cement ? Heidelberg cement ? India cement ? J.k cement ? Jk lakshami cement ? Kalyanpur cement ? Kcp ? Mangalam cement ? OCL ? Orient cement ? Panyam cement ? Prism cement ? Rain industries ? Ramco cement ? Saurashtra cement ? Udaipur cement ? Ultra tech cement SWOT ANALYSIS: Strengths: • ACC has been ranked india’s most admired company in the cement sector. • It also received the golden peacock environmental management award. • One of the top cement and construction companies based out of india. • ACC also received green manufacturing award and many other rewards. • ACC has a vast distribution network of 9,000 dealers in the country.

• Operations since last 80 years have made ACC a strong brand. • It has a strong efficient workforce of around 10,000 employees. Weakness: • ACC has done lesser branding activities as compared to its competitors. • ACC as a brand is famous only in india, so it not known globally as compared to other brands.

Opportunities : • ACC can leverage the Indian market leadership and expand to other parts of the world. • It can do extensive branding in the country that can help them increase brand recall and thus help the brand to grow as a whole. • Extended services in the field of construction. Threats: • Many local players offering low cost products are one of the threats for the ACC cements and company. • It is also faces strong competition from global players in Indian markets. The manufacturing plants of ACC ltd are situated in the following location:- Bargarh – Capacity (MTPA) 0.96 Chaibasa – Capacity (MTPA) 0.87 Chanda – Capacity (MTPA) 1.00 Damodhar – Capacity (MTPA) 0.53 Gagal – Capacity (MTPA) 4.40 – Gagal I and II Jamul – Capacity (MTPA) 1.58 Kymore – Capacity (MTPA) 2.20 Lakheri – Capacity (MTPA) 1.50 Madukkarai – Capacity (MTPA) 1.18 CEMENT MANFACTURING PROCESS:- Types of cement: manufactured by Acc group:- • Ordinary Portland Cements (OPC) • Portland Pozzolana Cement (PPC) • Portland Slag Cement (PSC) PSC is prepared by using: ? Clinker 45% ? Slag 50% ? Gypsum ; additional 5% OPS is prepared by using: ? Clinker ? Gypsum PPC is prepared by using : ? Fly ash ? Clinker FINANCIAL STATEMENT : PROFIT AND LOSS A/C OF ACC: Profit ; Loss account of ACC ——————- in Rs.

Cr. ——————- Dec 16 Dec 15 Dec 14 Dec 13 Dec 12 12 mths 12 mths 12 mths 12 mths 12 mths INCOME Revenue From Operations Gross 12,465.79 12,876.64 12,851.02 12,230.54 12,411.93 Less: Excise/Sevice Tax/Other Levies 1,529.38 1,443.88 1,369.97 1,322.13 1,281.48 Revenue From Operations Net 10,936.41 11,432.76 11,481.05 10,908.41 11,130.45 Other Operating Revenues 221.93 364.07 257.16 260.53 227.51 Total Operating Revenues 11,158.34 11,796.83 11,738.21 11,168.94 11,357.96 Other Income 112.71 119.35 268.28 223.79 264.82 Total Revenue 11,271.05 11,916.18 12,006.49 11,392.73 11,622.78 EXPENSES Cost Of Materials Consumed 3,744.36 4,133.83 4,230.13 4,003.82 3,987.78 Purchase Of Stock-In Trade 90.17 108.29 194.33 232.86 158.75 Changes In Inventories Of FG,WIP And Stock-In Trade 16.99 0.05 -11.28 6.53 20.02 Employee Benefit Expenses 778.31 769.87 746.59 661.68 616.65 Finance Costs 72.87 67.32 82.76 51.67 114.65 Depreciation And Amortisation Expenses 605.16 652.06 557.58 573.95 558.88 Other Expenses 5,117.47 5,256.94 5,088.84 4,635.26 4,379.18 Less: Inter Unit / Segment / Division Transfer 5.96 9.32 17.66 0.00 0.00 Total Expenses 10,419.37 10,979.04 10,871.29 10,165.77 9,835.91 BALANCESHEET OF ACC.LTD: Balance Sheet of ACC ——————- in Rs. Cr. ——————- Dec 16 Dec 15 Dec 14 Dec 13 Dec 12 12 mths 12 mths 12 mths 12 mths 12 mths EQUITIES AND LIABILITIES SHAREHOLDER’S FUNDS Equity Share Capital 187.99 187.95 187.95 187.95 187.95 Total Share Capital 187.99 187.95 187.95 187.95 187.95 Reserves and Surplus 8,473.45 8,255.09 8,047.66 7,636.89 7,194.85 Total Reserves and Surplus 8,473.45 8,255.09 8,047.66 7,636.89 7,194.85 Total Shareholders Funds 8,661.44 8,443.04 8,235.61 7,824.84 7,382.80 NON-CURRENT LIABILITIES Long Term Borrowings 0.00 0.00 0.00 0.00 85.03 Deferred Tax Liabilities Net 558.14 469.16 535.57 507.27 516.92 Other Long Term Liabilities 0.00 0.00 0.00 406.75 381.09 Long Term Provisions 131.68 119.86 115.94 89.09 157.21 Total Non-Current Liabilities 689.82 589.02 651.51 1,003.11 1,140.25 CURRENT LIABILITIES Short Term Borrowings 50.02 35.50 0.00 0.00 0.00 Trade Payables 1,256.93 874.11 750.23 639.20 660.49 Other Current Liabilities 2,173.11 2,259.82 2,096.71 1,545.69 1,515.81 Short Term Provisions 606.15 639.33 937.27 1,080.75 1,226.88 Total Current Liabilities 4,086.21 3,808.76 3,784.21 3,265.64 3,403.18 Total Capital And Liabilities 13,437.47 12,840.82 12,671.33 12,093.59 11,926.23 ASSETS NON-CURRENT ASSETS Tangible Assets 7,458.85 5,284.78 5,597.75 5,503.13 5,858.86 Intangible Assets 3.53 0.20 0.64 0.83 5.01 Capital Work-In-Progress 260.82 2,370.96 1,914.63 819.61 311.30 Fixed Assets 7,723.20 7,655.94 7,513.02 6,323.57 6,175.17 Non-Current Investments 235.94 274.55 290.90 176.81 194.67 Long Term Loans And Advances 962.78 1,073.38 855.56 866.83 564.20 Other Non-Current Assets 483.05 466.30 360.71 308.24 165.84 Total Non-Current Assets 9,404.97 9,470.17 9,020.19 7,675.45 7,099.88 CURRENT ASSETS Current Investments 1,568.27 1,201.15 1,282.08 2,017.21 2,358.88 Inventories 1,223.75 1,188.60 1,255.59 1,121.47 1,133.55 Trade Receivables 467.73 484.35 410.71 397.22 303.45 Cash And Cash Equivalents 275.58 91.60 304.30 503.38 678.38 Short Term Loans And Advances 437.02 349.84 383.92 359.39 323.29 OtherCurrentAssets 60.15 55.11 14.54 19.47 28.80 Total Current Assets 4,032.50 3,370.65 3,651.14 4,418.14 4,826.35 Total Assets 13,437.47 12,840.82 12,671.33 12,093.59 11,926.23 OTHER ADDITIONAL INFORMATION CONTINGENT LIABILITIES, COMMITMENTS Contingent Liabilities 3,012.35 3,457.09 2,410.62 3,296.75 1,715.30 CIF VALUE OF IMPORTS Raw Materials 78.69 83.24 111.07 56.07 103.00 Stores, Spares And Loose Tools 40.66 32.30 52.92 53.65 107.50 Trade/Other Goods 239.73 351.75 512.02 209.44 402.52 Capital Goods 43.43 71.58 191.47 104.35 51.00 EXPENDITURE IN FOREIGN EXCHANGE Expenditure In Foreign Currency 122.17 124.80 135.39 188.03 78.30 REMITTANCES IN FOREIGN CURRENCIES FOR DIVIDENDS Dividend Remittance In Foreign Currency 0.92 1.63 1.84 1.63 1.52 EARNINGS IN FOREIGN EXCHANGE FOB Value Of Goods – – – – – Other Earnings 0.66 2.59 1.85 0.78 – BONUS DETAILS Bonus Equity Share Capital 91.95 91.95 91.95 91.95 91.95 NON-CURRENT INVESTMENTS Non-Current Investments Quoted Market Value 28.36 17.05 9.63 5.79 9.53 Non-Current Investments Unquoted Book Value 230.15 268.76 285.11 171.02 171.02 CURRENT INVESTMENTS Current Investments Quoted Market Value – – – – – Current Investments Unquoted Book Value 1,568.27 1,201.15 1,282.08 2,017.21 2,358.88 CHAPTER-2 CONCEPTUAL BACKGROUND AND LITERATURE REVIEW INTRODUCTION: The literary meaning of the term ‘Inventory’ is stock of goods.

It is composed of goods that will be sold in future in the normal course of business operations. The goods, which a firm stores as inventory in anticipation of need, can be classified as follows: ? Raw materials. ? Work in progress. ? Finished goods. ? Consumable stores and spares. • Raw materials: – They are the inputs of the final products.

They are purchased by the firm from others and are used in the production for being converted into finished products. They are generally basic raw materials or finished components. • Work in Progress: – This refers to the goods lying in the manufacturing process. They are normally partially finished or semi-finished goods that are at various stages of production in a multi-stage production process. • Finished goods: – These are the final or completed products which are ready for sale.

• Consumable stores and spares: – These are the goods held for consumption by machines in a manufacturing concern. They include spare parts, lubricants, cleaning materials, oil, cotton waste etc. They do not enter into the final product but they are required for maintaining and running the machines for production purpose. The levels of the above four kinds of inventories differ depending upon the nature of the business. For example – a manufacturing firm will have all the four kinds of inventories. But a retailer or wholesaler will have a high level of inventories of finished goods but they will have no inventories of raw materials, spares, maintenance supplies and stores and goods in progress.

Further depending upon the nature of the business inventories may be durable or non-durable, valuable or inexpensive, perishable or non-perishable etc, Inventory control has been attracting the attention of managers in India for a long time. But with the credit squeeze measures announced by the government of India and the consideration of the recommendations of the committee for inventories top management are deeply concerns with developing suitable norms for inventory control. In this context research has shown the engineering oriented public sector undertaking carry more inventory than the other categories. MEANING OF INVENTORY: The term Inventory’ refers to the stock of raw materials, spare parts, and finished products held by a business firms. It is aggregate quantity of materials resources and goods that are idle at a given point of time. The resources may be of any type; for example men, materials; machines, money, when the resources involved in materials or goods in any stage of completion, inventory referred to as stock.

Hence inventory refers to the “stock” that a business firms keeps to meet its future requirement of production and sales. DEFINITION OF INVENTORY: Several authors have defined the term Inventory. The most popular of them are “The term inventory includes Raw Materials, Work in Progress, finished packaging spares and other stocked in order to meet an unexpected demand OR distribution in the farther”. IMPORANCE OF INVENTORY: Inventory constitutes the largest component of current assets in many organizations.

Poor management of inventories therefore may result in business failures. A stock out creates an unpleasant situation for the organizations in case of a manufacturing organization (in stock out ability to supply an item from inventory) could, in extreme cases, bring production process to a half; conversely, if a firm carries excessive inventories the added carrying cost may represent the difference between profit and loss. Efficient inventory control therefore, can significantly contribute to the overall profit-position of the organizations. BENEFITS OF HOLDING INVENTORY: ? It enables the firm to undertake continuous production and reduce the setup costs associated with the state of production. ? It enables the firm to avoid losses arising on account of losing the customers for non-supply of goods in time. ? It enables the firm to reduce variable costs associated with planning small orders frequently.

? It enables the firm to derive the advantages of bulk buying such as competitive price, higher rates of discount, benefit of lower prices against anticipated or announced price-rise avoidance of unexpected shortages etc. ? It enables the firms to avoid scarcity of goods meant for either Production or sale. ? Adequate stock of finished goods received either from purchases OR from production serves to bridge the gap between purchases OR production and actual sale. It also serves as a competitive marketing tool to meet customer demand as it can supply goods to its customers immediately. If it is not do so, its customers are likely to go to its rivals. Inventory therefore ensures continued patronage of customers.

TYPES OF INVENTORIES: Classification of Inventories: 1. ANTICIPATION INVENTORIES: Such inventories carried to meet predicable changes in demand. In case of seasonal variations in the availability of some raw materials it is convenient and also economical to build up stocks was consumption pattern may be reasonably uniform and predict. 2. FLUCTUATION INVENTORY: Demand fluctuates overtime and it is not possible to predict it accurately. Business firms maintain reserve stocks to meet unexpected demand and thereby to avoid the risk of loosing sales.

These safety stocks known as fluctuation inventory there is a time gap between union and use of certain products. The goods produced in one season in stock for sale and used throughout the year. When the availability of raw materials is seasonal, bulk stocks are purchased for throughout the year. 3.

LOT SIZE INVENTORY: In order to keep costs of buying receipts, inspection, transport and handling charges low large quantity are bought for immediate need. It is a Common practice to buy some raw materials in large quantities in order to avail quantity of discounts. 4. MOVEMENT OR TRANSIT INVENTORIES: Raw material and finished goods one place to another some amount of inventory is always in transit longer the transportation period, greater is the amount of transport and inventories. The average amount can be determined mathematically.

I=SXT Where S = the average rate of sales (weekly avg) T = Transit time required to move from one stage to another in a week I = the movement of inventory needed 5. PRODUCTION INVENTORIES: Raw materials and other supplies parts and components, which enter into the product during the production process and generally form the part of product. 6. IN PROCESS INVENTORIES: Semi finished work in process and partly finished products formed at various stages of production.

7. M.R.O INVENTORIES: Maintenance repairs and operating supplies, which are consumed during the production process and generally, do not from part of the product itself. (e.g.: Oils and lubricants, machinery, and plants etc. 8. FINISHED GOODS INVENTORIES: Completed finished products ready for sale.

MAJOR DANGERS OF OVER INVESTMENTS IN INVENTORY: ? Blocking of firms funds in inventory. ? Excessive carrying costs. ? Risk of liquidity ? The excessive level of inventories consumes the finds of the firm, which cannot be used for any other purpose. The carrying cost such as the cost of storage, handling insurance, recording and inspection also increases in proportion to the volume of inventory excessive inventories carried for a long period brings down the liquidity of the firm. PROBLEM OF INADEQUATE INVENTORIES: 1.

Inadequate raw materials and work in progress will result in stopping of production. 2. If the finished goods inventories are sufficient to meet the demands of the customers may shift to order competitors, which will amount to a permanent loss to the firm. An effective inventory management should avoid both these extreme situations namely over investment and under investment in inventories. NORMS FOR INVENTORY CONTROL: Either the top management or the material management department could set the dorms (limits) for inventory.

The top management usually sets monetary limits for investment then has to collocate this investment to the various items and ensure the smooth operation of the company It would be worthwhile if the inventory norms are set by the management by objective ‘concept. This concept accepts the top management to set the inventory norms in consultation with the material department. The norms thus evoked should be specific and quantified the achievement of the target set is the responsibility of the material department. In the setting up of the norms, the involvement of persons who are directly responsible for maintaining the inventories is very desirable. Other departments involved in setting the norms are finance.

Production, marketing and material control. The norms of inventory should be converted to specifically spell out parameters like the number or stock outs permitted. MEANING OF INVENTORY MANAGEMENT: Inventory management covers a much wider field. The inventory management is concerned with the entire range of functions, which effaced the flow, conservation and utilization, the quality and the costs of materials. It is that aspect, which is concerned with the activities, involved in the acquisition and storage of all materials directly and indirectly employed in the production of the finished products. These activities includes material planning, programming functions such as customer service requirements, etc, viewed in that perspective inventory management is broad in scope & effects a great number of activities in organization.

Because of these numbers inter relationships inventory management stresses the need for integrated information flow & decision making as it relates to inventory policies and overall systems. Inventory control on the other hand is defined in a narrows sense than inventory management and pertains primarily to the administration of established policies, systems & procedures. For exempla, the actual steps taken to maintain the stock levels or stock records refer to inventory control FACTORS INFLUENCING 1NVENTORY MANAGEMENT & CONTROL: Several factors influence inventory management and control. The principal effects of these factors are reflected most strongly in the levels of inventory and the degree of control planned in the Inventory control “system” The factor include type of product, type of manufacture, volume of out put and others. TYPE OF PRODUCT: Among the factors influencing inventory management and control. The “type of product “is fundamental.

If the materials used in the manufacture of the product have a high unit value. When purchased, a much closer control is usually in order. If the material used in the product is in a short supply or is auctioned by the government, this may influence the purchase of this material and stock maintained. The manufacture of standard products as compare to custom-made items still influence inventories Material needed to manufacture a standard product is easy to manufacture a standard product is easy to obtain and a close control on the stock is not necessary.

Material required to product made-to-order-items needs strict control to ensure that no item is cost in the process of manufacture such materials and tools are of special and expensive type and a loss of any small part will hold up the production. TYPE OF MANUFACTURE: Besides type of product, “Type of manufacture also influences inventory management & control where continuous manufacture is employed at the rate of production is the key factor. Here inventory control is of major important & in reality controls the production of the product. The economic advantage in this type of manufacture is the uninterrupted operation of the machines & assembly lines in the plant.

Intermittent manufacture on the other hand permits greatest flexibility in the control of material. VOLUME: The “Volume of Produced” to be made as represented by the rate of production may have little effect on the complexity of the inventory problems. Literally millions of braces bases for light bulbs are manufactured even involving the control of only two principal items of raw materials inventory. On the other hand the manufacture of large locomotive involves the planning and control of thousands of items in inventory.

THE OTHER FACTORS ARE: • The objective of the company as they relate to inventories and the level of service to be provided to customers. • The qualifications of staff personnel who will design and coordinate the implementation of the system. • The qualifications of personnel who will be responsible lbr managing the system on a continuing basis. • The nature and size of inventories and their relationship to the other functions in the company, such as manufacturing finance marketing etc.

• The capability of present and future data processing equipment. • The potential savings that might be anticipated from improved contort of inventories. • The present method for controlling inventories and for making inventory decisions. • The degree of commitment by management personnel to the development of more effective inventory management system and the results anticipate from such a system. BENEFITS OF INVENTORY MANAGEMENT & CONTROL: • Inventory control ensures an adequate supply of materials stores etc minimizes stock-out and shortages and avoids costly interruptions in operations.

• In keeps down investment in inventories inventory carrying costs and obsolescence losses to the minimum. • It facilitates economical purchasing through the measurement of requirement on the basis of recorded experience. • It eliminates duplication in ordering or in Replenishing stocks by centralizing the sources from which purchase requisitions emanate. • It permits a better utilization of avoidable stocks by facilitating inter department transfers with in a company. • It provides a check against the loss of materials through carelessness or-pilferage.

• It facilitates cost allotting activities by producing a means for allocating material cost to products departments or other operating accounts. • It enables management to make cost and consumption comparison between operations & consumption comparison between operations & periods. • It serves as a means for identifying and disposal of inactive and obsolete items of stores. • Perpetual inventory values provide consistent & reliable basis for preparing financial statements.

PROCESS OF INVENTORY MANAGEMENT & CONTROL: As mentioned earlier. Inventory management and control refers to the planning far optimum quantities of materials at all stages in the production cycle and evoking technique, which would ensure the availability of planned inventories. FOUR STEPS ARE INVOLVED IN THE PROCESS THEY ARE: ? Determination of optimum inventory levels and procedures of this review and adjustment. ? Determination of degree of control that is required far the best results. ? Planning and design of the inventory control system. ? Planning of the inventory control organization.

1) OPTIMUM INVENTORY LEVELS: Determination of inventory that an organization should bold is a Significant but difficult task. Too much of inventory result in locking up of working capital accompanied by increased carrying costs (but reducing ordering cost). Excess inventories; however guarantee uninterrupted supply of materials and components, to meet customers demand. Too less of inventory releases working capital far alternative used and induces carrying cost (increases ordering costs) but there is risk of stock out costs. All these and other related factors must be considered to determine a level of inventory, which an organization should hold.

An interesting aspect is that the level of inventories is not static what is the optimum level today may not be so tomorrow Hence inventory management must plan for the review of the stock often. 2) DEGREE OF CONTROL: The second aspect of inventory management is to decide just How much control is needed to realize the objectives of inventory management the difficulty is best overcome by classification of inventory on the bases of value popularly called ABC, VED, FSN analysis and other methods is useful in deciding the degree of control. More importance should be given but also to items of high consumption. 3) PLANNING AND DESICN OF THE INVENTORY SYSTEM: In inventory system provides the organizational structure and the operating policies for maintaining and controlling goods to be inventoried.

The system is responsible far ordering and receipt of goods, tinning the order placement, and keeping track of what has been ordered, how much and from then. Further, the system must provide follow up to enable the answering of such questions as. Has the vendor received the order? Has it been shipped? Are the Hems correct? Are the procedures established far reordering or returning undesirable merchandise? ORGANISATIONAL ARRAGEMENT: The last aspect of inventory management and control is to determine an organization structure to handle inventory. Organizationally speaking inventory control function is assigned to materials management or production planning and control. Attaching inventory control to material management Activity is feasible in organizations were integrated material management is in practice, There is strong justification far such an arrangement as inventory control is part of material activity and all material functions must be integrated into one group. Assigning inventory control function to production planning and control however has advantages.

Production planning and control department will be in a better position to plan its production schedule with the knowledge of inventory under its control. Besides, the production planning and control department will be able to issue timely requisitions for replenishment of stocks used in the production operation. And logically speaking it is the production department, which is the user of inventories, and the same department must be held responsible for controlling them. Actually the nature of a firm’s production operation its product and the type of market in which it operates determine the preference for assigning inventory function to production. An engineering oriented company producing specialized technical products on a job shop basis might well choose to emphasize production. Considerations as long as an analysis of total cost justif3′ such a decision.

Hence, inventory may report to the production division on the other hand, a mass producer of electric motors might well find itself in just the opposite situation and be compelled by relative cost considerations to integrate inventory control with purchasing. Whatever the consideration, it may be pointed out that any inventory control system is not “once set goes automatic” type but needs to be reset from time to time as the conditions such as lead time, consumption pattern etc. Keep changing. INVENTORY CONTROL TECHNIQUE TOOLS: Inventory control techniques are employed by the inventory control organization coition the frame cork of inventory models Inventory control techniques represent the operational aspect of inventory management and help realize the objectives of inventory management & control several techniques of inventory control are in use and it depends.

On the connivance of the firm to adopt any of the techniques. What should be stressed however is the need to coves all items of inventory & all stages le from the stage of receipt from suppliers to the stage of their use. INVENTORY CONTROL TECHNIQUES: • ABC classification. • HML classification • VED classification • SDE classification • FSN classification • Level setting • Two Bin system • Material requirement planning • Physical verification of stock • Just-in-time technique I) ABC – Always better control classification: One of the widely used techniques for control of inventories is ABC analysis.

The objectives of ABC control is to vary the expenses associated with maintaining appropriate control according to the potential savings associated with a proper level of such control. ABC analysis consists of the classification of the materials into categories A, B & C on the basis of their value. Items of high value & comparatively less in number are included in ‘A’ category. Generally they constitute about 70% of the total value and about 15% of the total number. Items of low value be large in number are included in ‘C’ category. Generally, they account for above 70% of the total value and about 60% of the total number.

Items of moderate value and moderate in number are included in ‘B’ category. They Account about 20% of the total value & 25 % of the total number. Items of ‘A’ category are subject to strict with regard to purchase storage and use. Items of ‘B’ category are not subject to much control. The objective of this analysis is to reduce the investment of inventory the cost of inventory control and also loss of inventory.

2) HIGH MEDIUM AND LOW (HML) CLASSIFICATION: The high medium and low classification follows the same Procedure as adopted in ABC classification only difference is this in HML classification unit value is the cretin and not the consumption value. The items of inventory should be listed in descending order of unit value and it is up to the management to fix limits for the three categories. For Example: – The management may decide that — are the units with unit value of Rs.2000/- and above will be ‘H’ items Rs.1000 to Rs.2000 ‘M’ items and less than Rs.1000 ‘C’ items. The HML analysis is useful for keeping control over consumption at department levels, for deciding frequency of physical verification and for controlling purchases.

3) VITAL ESSENTIAL AND DESIRABLE (VED): CLASSIFICATION: While in ABC classification inventories are classified on the basis of their consumption value and in HML analysis and value is the basis, criticality of inventories is the basis for vital essential and desirable categorization. The V&D analysis is done to determine the artificially of an item and its effect on production and other services. It is specially used for classification of space parts. If a part is vital it is given ‘V classification, if it is essential than it is given ‘E” classification and if it is not so essential the part is given ‘D’ classification. For ‘V items a large stock of inventory is generally maintained, while for ‘D’ items minimum stock is enough.

4) SCARCE, DIFFICULT AND EASY TO OBTAIN (SDE): The SDE analysis is based upon the availability of items and is Very useful in the context of scarcity of supply. In this analysis ‘S’ refers to “Scarce” items, generally imported, and those which are in short supply ‘D’ refers to difficult items which are available indigenously but are difficult items to produce. Items, which have to come from distant places or for reliable suppliers are difficult to come by fall into ‘D’ category, ‘B’ refers to items which are easy to acquire and which are available in the local markets. The SED classification based on problem faced in procurement is vital to lead time analysis and is deciding on purchasing strategies. 5) FAST MOVING, SLOW MOVING AND NON-MOVING (FSN): FSN stands for fast moving slow moving and non-moving. Here classification based on the pattern of issue from stores and useful in controlling obsolescence.

To carry out FSN analysis the date of receipt or the last date of issue which ever is later is taken to determine the number of months, which have moved since the last transaction. The items are usually grouped in period of 12 months. FSN analysis is helpful in identifying cutoff items, which need to be moved regularly and surplus items, which have to be examined further. Non material moving items may be examined further and their disposal can be considered. 6) LEVEL SETTING: Setting up of inventory levels, such as maximum level, minimum level, Reorder level, Danger level, Average stock level. The above level are calculated when a storekeeper should place an indent for fresh stock and also to avoid aver stocking of any material.

At the same time to ensure follow .up sufficient materials to production process. The man purpose of fixing the levels is to control the investment on inventories. ? MINIMUM LEVEL: This is the limit below, which the stock should not be allowed to fall, it is fixed on the basis of average consumption ; average lead-time. Required measuring the item. The main purpose of fixing this level is to ensure adequate check for continuous production and sales. Minimum level = Reorder level-(Normal consumption into normal Reorder Period) ? MAXIMUM LEVEL: This is the limit or level beyond which the stock of an item should not exceed.

This level is fixed for avoiding over stocking of materials and its associated risks. Maximum level Reorder quantity (EOQ) (Minimum consumption x Minimum reorder period) ? RE-ORDER LEVEL: It is the point fixed between maximum and minimum level at which the storekeeper has to initiate action to obtain fresh supplies of materials.This point will usually be slightly higher than the minimum stock to cover such emergencies is abnormal usage or unexpected delay in supply Re-ordering level depend on lead time, rate of consumption and economic order quantity. Reorder level = Maximum consumption ; Maximum Reorder Period. ? DANCER LEVEL: It is the level below the minimum level when the stock reaches this danger level urgent action for purchase is necessary. As normal lead-time is not available it is necessary to resort to unorthodox purchase procedure resulting in higher purchase cost. Danger level = Minimum consumption x Emergency Recorder period.

? AVERAGE STOCK LEVEL: Maximum level + Minimum Level 2 ? Economic order quantity (EOQ): It can be described as the basis how much to buy modes. It is shortened to EOQ and is the oldest and widely known inventory model. It dates back to 1915. The purpose of using EOQ model is to find that particular quantity of order which minimum total inventory costs. EOQ is the technique, which solves the problem of the materials, manages.

EOQ is the order size at which the total cost, comprising ordering cost and plus carrying cost, is the least. EOQ will be fixed at a level where the total of ordering cost will be the minimum. EOQ can be calculated by a mathematical formula EOQ =?2A0 C Where A= annual consumption to units O = ordering cost per order C = carrying cost per unit per annum. 7) TWO-BIN STYSTEM: It is mainly adapted to control ‘o’ group inventories.

In the two bins system stock of each item is separated into two bins. One bin contains stock; just enough to last from the date of placing a new order unit it is received in inventory. The other bin contains a certain quantity of stock that will be sufficient to satisfy probable demand during the period of replenishment stock first issued from the 1st bin, when the 1st bin is empty an order of replenishment is made and the stock in the 2nd bin is utilized until the ordered material is received. 8) MATERIAL REQUIREMENT PLANNING: It is fairly recent technique that has been introduced to control Inventories, it is based on computer technology, material requirement it planning mainly helps in ensuring arrival of materials exactly when it is needed for production. At the same time it reduces the length of the materials are held in inventory. Material requirement plans and control goods on order and helps in determining, when and what specific materials will be needed to meet the previously production schedules.

9) JUST-IN-TIME (JIT): The concept JIT means that virtually no inventories are held at any stage of production and that exact number of units is brought to each successive stages of production at the right time. It is also called “zero inventories”. The concept JIT was started in the ‘Motto machi’ plant of Toyota in Japan, when the system has been perfected and results achieved. The plant has a long time of trucks waiting outside with frill loads of automobile parts for the assembly time.

As soon as one truck comes out from one end of the plant, another truck gets inside. There is no warehouse for the parts. In India, the Maruti Udyog LTD has adopted JIT. USE OF BIN CARDS AND STORES LEDGER BIN CARD: Bin is a place, rack or cupboard where materials are stored.

Each bin shall have a card to show the position of stock in the bin. It is known as Bin card. A bin card gives bin number, description, code number of materials ; different levels of materials. It is ruled in columns to depict stock received, goods received note number, materials issue, materials requisition numbers, balance of stock on and remarks. The bin card thus indicates ready stock position of an item at any moment; Entries are made usually by stores personnel.

LITERATURE REVIEW:- 1. R. Hamsalakshmi -M. Manicham 2000″The study, it has been found the liquidity position and working capital positions were favorable and good during period of study. Regarding turnover ratio, efficiency in management of fixed assets and total assets must be increased. Regarding return on investment and return on equity was proved that the overall profitability position of the software companies had been increasing at a moderate way. 2. Dr R.Dharmaraj 2000The study artical “positing in Indian management industry ”have concluded that for the last five year, there has been proliferation of international and domestic providence of mutual funds.

He says that this increased growth is due to the increasing cash flows among innovative young companies through India. 3. Dr Harish kumar2008 A capital adequacy ratio was constant over a period of time. During the study period. It was observed that the return on net worth had negative correlation with the debt equity ratio. Inters income to working funds also had a negative association with interest coverage ratio and the non performing to net advance was negatively correlated with interest coverage ratio.

4. J R Raiyani 2009 During the periods of high inflation depending on conventional accounting wisdom. May results in firm’s financial information losing its meaning and creation of unrealistic expectation among information users. 5. Dr.Kavitha Chavvali 2009 Inventory analysis of gold exchange trade funds. Mathew. T.

Jones and Maurice ousted (2007) revised and evaluated pre world war ii current date for countries by treating gold follows on a continuous basis. The historical data of saving and investment was taken over a time period of 1850- 1945. 6. N.Prasanna 2009 Stock performance Aitkin 1997 the external effect foreign direct investment on export with example of Bangladesh where entry of a koala multinational in garment exports led establishment of a member of domestic export firms creating the country’s largest export industry. 7. Awedh 2005 defend that inflator does not have really an effect on the profitability measured by return on equity of foreign banks exerting in Lebanon.

In the same way, the author steers that the level of inflation affect more than the return on assets of Lebanese bank than foreign banks in Lebanon. 8. Dr Sushil kumar Mehta 2010 The financial performance mutual funds schemes. Jayadew (1996) attempted of evaluate the performance of two growth oriented mutual funds on the basis of monthly return. It was found that master gain performed better according to Jensen and trey nor measures and basis of sharps ratio. 9. Monika uppal 2010 Financial performance factors a survey of the literature shows that the foreign bank performance is affected by factors like the economic and financial environment. Among these factors one can equate the growth rate of gross domestic product, monetary market rate, inflation rate and foreign exchange rate. (Williams 1998). 10. Bharathi pathak 1991 The bulk of the banking business in the country is in the public sector comprising the state bank of India and its seven associated banks and twenty nationalized commercial banks till 1991, the Indian banking industry was operating in a highly regulated and protected regime. But with the acceptance of Norseman committee recommendation, competition has been injected into the banking industry in two forms .The study has been found that HDFC Bank emerged as a leader in this financial analysis of the year ended 2000-01. It closest competitor was ICICI Bank. Financial performance of the other three, no doubt, lagged behind them, but it by no means, depressing. These Bank obviously, have to focus more improving parameters like credit quality and cost control for they merge as the top performance. 11. Delaunay c, sahin E, 2007 A lots of work has been done but if we want to go head we must have good visibility upon this field of research. That is why we are focused on frame work for an exhaustive review on the problem of supply management with inventory inaccuracy. The author said that their aim in this work is also present the most important criterion that allow a distinction between the different type of managing the inventory. 12. Bern at de william year 2008, This study tells that main focus of inventory management is on transporting and warehousing. The decision taken by managemnt depends on the traditional method of inventory control models. The traditional methods of inventory management is how much useful in these days the author tell about it. He is also saying that the traditional method is not a cost reducing, it is so much expensive. But the managing the inventory is most important work for any manufacturing unit. 13. Jon schreibfeder 1992, he said that it is easy turn cash into inventory, the challenge is to turn inventory back into cash. In early 1990’s many distributors recognized that they needed help controlling and managing their largest asset inventory. In response to these need several companies developed comprehensive inventory management modules and systems. These new packages include many new features designed to help distributors effectively managed warehouse stock. But after implementing this many distributors do not feel that they have gained control of their inventory. 14. D. Hoopman april 7,2003, in this article he said that inventory optimization recognize that different industry have different industry profile and requirements. Research has indicated that solutions are period in a large range from tens of thousand of dollars to million dollars . in this niche market sector price is definitely not an indicator of the quality of solution,ROI and usability are paramount. 15. Miller,2010, inventory control is the supervision of the storage, supply and accesibility of items to ensure an adequate supply without excessive oversupply. CHAPTER-3 RESEARCH DESIGN A research design is preliminary design of research work to be carried out and is an agreement to the condition for collection and analysis of data in a manner that aims to combine prevalence of research design with respect to work carried on. Statement of problem: The Title of the study is “inventory management at ACC ltd” Need of the study: • Meet variation in production demand. • Seasonal demand of products. • Economics of scale. • Take advantage of price increase and quantity discount. • Reduce cost and time. • Long lead and high demand items needed to be held in inventory. Objective of the study:- The main objectives of the study are:- ? To study the historical background of AMS ltd. ? To study the competitive environment. ? To determine critical evaluation of inventory management and control. ? To study the effectiveness of inventory management in today’s world. ? To analyze the function, procedures in inventory management and control. ? To suggest some strategies, remedies in various aspects of inventory management and control.To equip myself better in the area of inventory management and control. Scope of the study: • At Acc plant this study to seek to find the facts and opinions of inventory management and control. • In accordance with the present trends it aims mainly at finding out the inventory control procedures at Acc. Limitation of the study: • Time restriction was for 10 weeks. The information, which was needed, could not be revealed by the organization. • Discussion with all related officials was not possible. The study covered a vast concept hence wide collection and coverage of information was not easily possible. Tools for data collection : • Data base • Plan of analysis • Analysis and interpretation Methodology of data collection: a) Primary data: The primary data is collected by personal interviews with a few officials. b) Secondary data: Secondary data is that which have already been collected by someone else and which have already been passed through the statistical process. E.g. files, periodicals, manuals and text book. c) Field work: This was under taken individually to collect various information regarding the study by visiting following sections. Stores department: Information regarding stocking of materials receipts and issues to workshops. Inventory control procedures in various wards inside the department were obtained Accounts department: Remaining all the information was obtained from accounts department through personal interviews with section officials. Plan of analysis: The plan of analysis was collected from finance department. Analysis and interpretation: The analysis and interpretation was collected from finance department thus processed and tabulated is in the form of tables and graphs. The table thus obtained by calculating average, percentage, turnover ratio, graphs and diagram in respect of the stock of raw materials work-in-progress sales ; inventory control procedures and thus to draw conclusion from the analysis done. Scope of the study : • At ACC plant this study to seek to find the facts and opinions of inventory management and control. • In accordance with the present trends it aims mainly at finding out the inventory control procedures at ACC.LTD. Limitation of the study: • Time restriction. • The information, which was needed, could not be made public by the organization. • Discussion with all related officials was not possible. • The study covered a wide concept hence wide collection and coverage of information was not easily possible. INVENTORY MANAGEMENT AT ACC.LTD: The inventory management in ACC LTD is a complex function, as the management has to deal with from common consumables stores to most critical items. The fundamental has to deal with from common consumables stores to most critical items. The fundamental principles of inventory management as regards raw materials are to see that the right qty is bought at the right price and at the right time from the right source. WORKING PROCEDURE-STORES: A store is that area of operation of the organization that receives, preserve, allocate and apply materials, of and for the organization.Objective of the stores is to receive, preserve, allocate and apply the materials for right object they are procured and at an identified time they are required from a common point. Staff Job Description: ? Receiving proper quantity of materials in accordance with the purchase order and to maintain proper document for the receipt of materials after physically confirming the quantity of acceptance and rejections. ? Prepare, forward and maintain the material receipt data in the format of ICRR to the concerned departments through proper channel and procedure laid down in this respect. ? Cross verification of material receipts with order quantity and return of excess quantity supplied thereof (wherever applicable), intimation to act upon or organization for supply of short supply of materials as per delivery challan. ? Identification of materials inside the stores and assign proper and safer place for each and every item so as to facilitate easy and proper retrieval of the same. ? Issue of materials in right quantity for any given object as per design data, maintain issue data, and thereby sea to it that right materials planned will be applied for right object. ? Prepare and maintain delivery challan for material movement outside the premises of the factory. ? Timely cross verification of inventory, preparation of stock list. ? Initiate action on disposal of unwanted and non-moving materials. Stores Working Procedure: 1.Receipts 2.Issues 3.Preservation 4.Documentation 5.Co-ordination functions 6.Assignments as it may assign from time to time by the CEO. IF ANY OF THE CEMENT GETS REJECTED AT VENDOR PLACE: If the part rejected after supply of the same at our premises, is completely manufactured by the supplier (including raw material), in such case the supplier will have to supply a new part in place of the one rejected referring the same supply p.o. (p.o. pending will go up to the extent of rejection and rejection in view of p.o. is items as if not supplied) the material so rejected should appear in the rejected column of the icrr ,qty accepted will get reduced to the same extent and the stock will get reduced to the same extent. (Both qty and value) the same material can be received by the same supplier again with ref. to the same supply purchase order to the extent of pending p.o. The material so rejected will be sent back to the supplier along with an invoice (With ref. to the icrr concerned) equivalent to the amount billed by the party. If the part rejected after supply of the same at our premises, and is undertaken by a supplier only for a particular stage of operation by the supplier, if the rejection arising and the cause for rejection is attributable to any fault of the suppler undertaking (as defined in process definition) the supply will be rejected. such supplier will have to under go penalty to the extent of cost of material + cost of stages of operations the material undergone +the amount billed for the supply by the supplier.(in this stage only cost of material and location of material will get altered. the outgoing d.c .for mtl sent by us will get cancelled only while the materials received is accepted ) . Or the same material will have to be supplied by the supplier at his own cost completing all the stages of operation as if the rejected material should have been, if not rejected. in this stage only cost of material and location of material will get altered . The outgoing d.c. for mtl sent by us will get cancelled only while the materials received is accepted ) the same to be sent to the next supplier for next stage of processing. in this stage of receipt stock quantity of the material will not get effected but only the value and the outgoing d.c. for the materials sent for processing should get cancelled to the extent of quantity received thereby while entering icrr (labour charges type). We should be in a position to obtain such receipt details in the outgoing d.c.file for reference (at any point of time.) once the material received and accepted after inspection and completion of the final stage of operation the same will be ready for issue to assembly. Assembly will produce a pick list attached to a material issue note to the stores for getting materials for further assembly. While issuing materials for assembly the stock of the material will get refused to the extent of issue and the location of stock will become work in progress. in case of pick list containing materials not in stock the item will have to be issued at a later stage after receiving the same. The item out of stock should be a shortage Minimum order quantity: in case of consumables and screws stock will be maintained in m.o.q basis. These items will be ordered as and when the stock quantity reaches an m.o.q fixed from time to time. Once the item reaches m.o.q an indent to be raised for refilling the stock by default and such indent will be forwarded to purchase dept. Once in a day. In case where materials required in excess of b.o.m fixed(as per picklist) or for servicing/warranty replacement on field machines an indent will have to be raised from concerned dept to procurement and the same item will be issued out of stock reserved for any other projected machine. (Allocated reserved will have to be altered and replaced with a new order on the basis of indent) will in case of material issue for servicing / field replacements both indenting and issue system remains same but followed with a delivery challan whether chargeable/returnable/non-returnable as the case maybe OPERATING CIRCLE: Inputs required (erp implimeation) 1) From design department b.o.m for each machine will be deification and details viewed (modification of drg/spec nos from time to time) 2) Planning dept pick list consisting of machine features for each machine 3) Purchase dept purchase order copy for each parts supply 4) Assembly dept materials requisition note for parts issue non conformity report in case of rejections materials return note (incase of unused materials return) 5) Marketing work order machine disp. advice tools list (pick list-trials machine)Operation. Receipt of materials: If any materials received on not for payment basis (like free reject. replacement, additional spare, sample, trial component,) proper documentation facility to be made no duplicate ICRR will be allowed to be entered (Doc no. checking) Stock will get added to the extent of receipt of a material at the time of preparation of ICRR. Storing: On receipt of receipt of any material the same will be taken to stock and stored in an Allocated location (To be displayed in system) Valuation method Weighted Average system Stock qty = Mn_op_qt + Receipt qty – Issue qty Stock value = Mn_op val + Receipt_val – Issue val M.O.Q will be mentioned wherever applicable Once the item reaches MOQ stage of stock a reminder to be generated All items crossing below MOQ to be indented on daily basis by the system FIFO method of issues while issuing any stock to be followed If any material found not in use for a period of 6months or more, the same should be hilted, and a reminder showing list of such items demanding for attention. Maximum qty. will be defined wherever applicable; a reminder of such on screen from time to time is a must. Material Issues: Material issue will reduce concerned stock. FIFO method of material issue. A Class items, and fasteners will be drawn at assembly (Such pick list will prevail to issue on one slot for each machine).Printing facility – list of a particular item issued for diff. machine, list of materials issued to a particular machine, imports, elec. items, bought out, etc with value. Query: Query list printing facility – i.e. Material receipts and issue machine/difference Items ordered not received Stock status of a specific or a group of items at any given time(past also) etc. Specific/group of items sent for job work but not returned, returned, rejected etc. Job Work: Work order and purchase order to be generated before sending any item for job work On receipt of any material with ref. to Party D.C/inv, Purchase order and AMS-RDC a doc. ICRR to be generated. Provision for cancellation of job worked parts while making ICRR (To list o/s materials on time) Only value addition will take place while receiving job worked parts but the qty of stock remains same but the place of storing changes. Quantitative of returnable materials outside the premises of the factory should be accountable at any point of time. Any materials found not returned beyond a stipulated time, a reminder to be generated and sent to the party concerned. Query regarding parts sent to a particular party, a particular part sent to any party etc printing. Any items not returned within 6 month s of delivery (Even after reminder/s) a list of such items should go to Excise/Accounts dept from time to time. Miscellaneous movements: Miscellaneous movements like equipment, facility, spares and samples moved out of the factory for any reasons noted. Returnable d.c. for such items to be generated incorporating item code for such items also and such items returning and cancellation follow up within a stipulated time to be made Warranty spares: Any spares removed from the factory for warranty replacement, a note of such item should go to Excise/Accounts dept for necessary action from time to time. Rejections: For marking an item as rejected non conformity rep. reqd. Any item marked rejected should be decided either to scrap or to be charged to a party(I.E returning) If any materials found rejected and to be returned to party (should be lifted within a week) but not. CHAPTER-4 DATA ANALYSE AND INTERPRETATION 1. TABLE SHOWING STOCK OF RAW MATERIALS: Year Stock of raw materials (Rs in cr) 2004-2005 349 2005-2006 362 2006-2007 403 2007-2008 503 2008-2009 565 GRAPH: INTERPRETATION:– The table shows the stock of raw materials for five years, which is also graphically expressed. The graph clearly expresses the changes of stock of raw materials. In the year of 2004-2009 the fluctuation of raw material were found. But here the stock of raw material increased year by year. This was due to large and back orders from manufacturing company and in the event of early delivery of finished products. An increase in production target to meet the demand of customers is one of the chief reasons for the increase in the stock of raw materials large orders demand and production target necessitated maintenance of sufficient stock of raw materials. Though the increase in level of stocks in the year 2004-2009 was high there was neither blocking up of capital nor the production was interrupted. Therefore the organizations did not face much difficulty in the change stock level year to year. Though the increase in stock of raw material is not a healthy Trend ACC. LTD could achieve higher production target by utilizing higher level of stock. But it has to keep according to the demand calculation. INVENTORY TURNOVER RATIO: Inventory turnover ratio is the ratio, which indicates the number of times the stock is turned over (i.e. sold) during a year. In other words, it is the ratio between stock and cost of goods sold. The object of inventory turnover ratio is to ascertain the speed to movement of particular item. A high ratio indicates that the time is fast moving and investment in it is minimum a lower ratio denotes that the item is not concerned in more quantity. It is going out of demand and has late to overstocking such slow moving materials should be disposed off as early as possible. There are various traditional methods for calculating inventory turnover ratio. RAW Material turnover ratio: This measure expressed in % of the ratio between the stores Held in stock and value of issues made during the year. Raw materials turnover ratio is expressed as follows: R.M .TOR = Annual consumption of raw material. Average stock of raw materials. Where averages stock of raw material = Opening stock + closing stock 2 Here, to compute raw materials turnover ratio, annual Consumption of raw materials during the period and value of average stock held during the period is considered. Average stock is taken as half of the total of opening and closing stock. 2. TABLE SHOWING RAW MATERIALS TURNOVER RATIO. Year Raw Material Turnover in Percentage 2004-2005 13.0 2005-2006 10.3 2006-2007 16.0 2007-2008 15.6 2008-2009 14.6 GRAPH:- :- Interpretation:- Here in the case of raw material turnover ratio, higher turnover ratio indicates better control or management inventory and lower turnover ratios indicates accumulation of stocks,. Therefore the year 2004-2008 the turnover ratio was gradually increased and did well but it again fell down in 2005-2006 this shows lowest turnover ratio. Gradually it was increases up to 16% in the year 2006- 2007 was considered to be the higher turnover ratio and again it fell down to 15.6% in the year 2007-2008. WORK IN PROGRESS INVENTORY AT ACC. LTD: Work in progress inventory exists mainly because of the production cycle time or could also be maintained for decoupling successive manufacturing operations. The decoupling enables each of the production departments to plan independently. The work in progress arises in facilitating production plan according to work order planned by the management for better production in the various stages of manufacturing. According to the work order scheme, the work in progress accounted. It is usually accounted at the end of the month and is carried on to the calendar month to finish the work in progress activity into finished products. The shop officials maintain the accountable work in progress products. The work in progresses is usually stocked in respective cost and centers in workshops 3.TABLE SHOWING STOCKS OF WORK- IN- PROGRESS OF ACC LTD Year Work-in-progress (Rs in cr) 2004-2005 124.58 2005-2006 167.47 2006-2007 157.06 2007-2008 146.71 2008-2009 149.44 GRAPH:- INTERPRETATION: The above graph clearly shows the changes in work in progress inventory for the year 2004-2009, the work in progress for minimum in the year 2004-2005.It is the financial production target, which is responsible for the increase in work in progress and thus the work load become more the need for more number of work in progress arises. The increase and decrease of debits (labour, store, overheads, and other adjustments) and credits (value of finished goods) is also responsible for the higher work in progress. WORK- IN -PROGRESS TURNOVER RATIO: This is the ratio obtained by ascertaining cost of production (annual) and average work in progresses (WIP) during the year. Average WIP is half of opening and closing WIP work in progress turnover ratio is expressed as = Cost of production (annual) Avg. works in progress, Avg. Wip = closing stock + opening stock 2 4. TABLE SHOWING TURNOVER OF WORK IN PROGRESS: Year In Percentage 2004-2005 36.5 2005-2006 22.2 2006-2007 41.2 2007-2008 53.6 2008-2009 55.4 GRAPH:- INTERPRETATION:- The work in progress of turnover will be helps to smooth running of the company. The ACC. LTD maintains the well ratio of WIP TOR. In the year 2008-2009 the ratio is more as compared to other years. It is not so harmful to the company because the company as reduced thereby but again it has been increased by 22.2% in the year 2005-200 FINISHED GOODS TURNOVER RATIO: It is the ratio obtained by ascertaining cost of goods sold or sales and average stock of finished goods. Finished Goods Turnover Ratio Is Expressed As: COST OF GOODS SOLD. AVERAGE STOCK OF FINISHED GOODS. OR SALE OF FINISHED GOODS. AVERAGE STOCK OF FINISHED GOODS. Calculation of Finished Goods Inventory turnover ratio is not possible; ACC. LTD finished products are generally not stocked. Production target is based on the demand registered already by the concerned dealers. Therefore it works in accordance of the order placed by the customer; it does not take up production at present in anticipation of future demand. Hence the question of stocking of finished products does not arise. As and when the finished products are ready immediately dispatched to the concerned dealers and therefore they do not maintain any finished goods account, it is merely done on book adjustment basis. Due to lack of exact information about the finished goods, turn over ratio for this aspect is unable to calculate due to some restrictions. 5. TABLE SHOWING FINISHED GOODS INVENTORY: Years Finished goods (Rs in cr) 2004-2005 68.34 2005-2006 71.42 2006-2007 63.98 2007-2008 81.26 2008-2009 78.86 GRAPH:- INTERPRETATION: The finished products was vertical/ Horizontal cement centre are stocked in dispatch section usually the finished products are not stocked for a longer period, as the production target is based on the demand registered already by concerned dealers and does not take up production in anticipation of future demand.The finished goods have been increased in the year 81.26cr. 6. TABLE SHOWING ANNUAL SALES FOR THE LAST 5 YEARS: Year Annual sales (Rs in cr) 2004-2005 3,283.98 2005-2006 3,897.85 2006-2007 5,731.75 2007-2008 6894,79 2008-2009 7229.97 GRAPH:- INTERPRETATION: The sale of ACC LTD products meant for internal consumption of different industry and sometimes to the out sides i.e. therefore required quantity of products is manufactured, according to the demands to concerned dealers. Hence the sale is only between the concerned parties and a small portion of ACC products are being sold to private parties in local on individual need basis. The sales graph clearly shows at what rate the ACC products are turned over every year. The sales of the ACC are in increasing order. The sales of the year 2004-2005 are so mare as compared to the year 2008- 2009. This is again due to the increased demand and production target from concerned dealers. Chapter-5 FINDINGS, CONCLUSION AND SUGGESTIONS FINDINGS: The stock of raw material increased year by year at ACC.LTD the turnover ratio have fell down to 10.3 % in the year 2005-2006 the finished goods have been increased 78.86cr in year 2008-09 inventory turnover ratio shows lowest turnover ratio in year 2005-06. The sales of the ACC are in increasing year by year. This is again due to the increased demand and production target from concerned dealers. Inventory management in ace manufacturing system ltd is sufficient for its production control. ACC has a very good system of inventory management and control therefore many defects were not found in this was the concept in their organization. SUGGETIONS:- A part from which few suggestions are given for the growth of organization in future. • The organization has to make optimum use of working capital invested in inventory. • The level of inventory may also be improved by a close study of the manufacturing cycle. • The inventory control function can be made more efficient and effective in future inventory control techniques. • The maximum utilization of computerization must be opted in the field of inventory management and control. • In case of scrap the disposal should be made as early as possible to avoid blocking up of capital. • Periodic review of slow and non-moving materials should be considered in order to avoid obsolescence and deterioration. • Better utilization of stock should be undertaken and avoid accumulation of stocks. • Ware house keeping and storage facilities have to be maintained for the smooth functioning. • There should be further improvement in identification and codification of material in ABC classification. CONCLUSION: This topic inventory management has a greater implications of Indian Industries from the analysis of “Inventory management” in ace manufacturing system ltd it was very clear that it has achieved greater importance in also enhance the arising need of the organizations, in respect of inventory management and control. The inventory management and control in ACC.LTD is a very complex function. The function of stores department in inventory control technique is to achieve production programme and it is a difficult task in today’s business world. Ace manufacturing system ltd has maintained a good system of “Inventory management”. The sufficiency of all raw materials in inventory control has achieved great progress in production programme year by year. Therefore inventory management cuts as the “pales” of any organization and will have its impact on all other captivities in the organization. Though inventory management comprises huge investment it gives good results. When a good inventory control technique is adopted and thus enhances the smooth functioning of production. This study has helped me as a lot in obtaining good knowledge of inventory management in ACC. ltd. Here by inventory management is an essential element in any organization provided it is maintained tactfully adopting latest techniques and utilizing best results from computerization.