On

THE DISTRIBUTION CHANNEL

EXTRUSIONS OF HINDALCO

At
HINDALCO INDUSTRIES LIMITED RENUKOOT, SONNEBHADRA
Submitted to: Miss Ritu Kapoor Submitted by: ANUP KUMAR TIWARI MBA 3rd Sem Roll no.-0821170402

AKNOWLEDGEMENT
At the outset, let us express my thankfulness to the person with whom we have interacted and have been provided with the background for accomplishment of our present task. The significant contributions have made my project completed. With great pleasure, we express our heartiest thanks to Mr. S K Das (Manager Training & Development Center), Mr.Ajay Jouhari (Manager, Sales Department), for providing us an opportunity to under go summer training in sales department of HINDALCO INDUSTRIES LIMITED, Renukoot. We would like to extend our earnest gratitude to Mr.M.C.Mahapatra (Sales Manager) & Mr. Rahul Paliwal (Assist. Sales Manager), our project guide, whose timely guidance and assistance kept us in the right direction throughout our project work. We wouldnt like to forget the valuable contributions of the entire Sales Department, for lending us all possible cooperations.

DECLARATION
I ANUP KUMAR TIWARI declare that the short term project report, DISTRIBUTION CHANNEL OF EXTRUSION HINDALCO INDUSTRIES LTD.is an authentic work carried out by me under gudience and supervision of Mr. Rahul Paliwal(Asst. Manager Sales Department) at HINDALCO INDUSTRIES LTD. . The project is submitted in partial fulfillment of Post Graduate degree Course in Management from R.B.M.I. GREATER NOIDA G.B.NAGAR.

ANUP KUMAR TIWARI M.B.A. 3rd Sem

Roll No. 0821170402

PREFACE
The report is hard intends to reflect some of the basic covered under the DISTRIBUTION CHANNEL of HINDALCO, EXTRUSIONS a first truly MNC of India. The total aspects have been formulated and presented on the basis of ideas and information gathered by this investigator during a shorter span of project training i.e. an important portion of the MBA curriculum leading to an opportunity for the participant to have a practical exposure of the contents under the topic beyond what has already been studies during the class-room interaction. This report has been written in response to a comprehensive study, conducted on the DISTRIBUTION CHANNEL of HINDALCO INDUSTRIES LIMITED. The report mentions and evaluates the various aspects, pertaining to the distribution channel of the company. After a thorough analysis of the various facts stand figures, a set of recommendations has been given at the end of the report. Accuracy and precision has been given the prime consideration, while compiling the report, are authoritative and authentic. We are confident that anyone who goes through the report will learn how much we have learnt & benefited during this period. Anup Kumar Tiwari MBA 3rd Sem.

Roll No.-0821170402

TABLE OF CONTENT
Title Pg.No.
DECLARATION CERTIFICATE ACKNOWLEDGEMENT PREFACE

INTRODUCTION. 1 - 17 ABOUT ADITYA BIRLA GROUP COMPANIES. JOINTVENTURES COMPANIES. HINDALCO INDUSTRIES Ltd. JOINTVENTURE COMPANIES OF HINDALCO. COMPANY PROFILE 18 - 21 PRODUCT 22 - 36 PROFILE AND

OBJECTIVES LIMTATIONS37 - 39

RESEARCH METHODOLOGY..40 - 41 ALUMINIUM A GOLD...42 - 61 WHITE

DISTRIBUTION CHANNEL HINDALCO...62 - 99 CONCLUSION SUGGESTIONS100 - 102

OF AND

BIBLIOGRAPHY 103 104

INTRODUCTION
AB0UT ADITYA BIRLA GROUP COMPANIES HINDALCO INDUSTRIES LIMITED FINANCIAL PERFORMANCE

ABOUT ADITYA BIRLA GROUP

The Aditya Birla Group is Indias first truly multinational corporation (MNC), Over 75 units in India and overseas as well (in Thailand, Indonesia, Malaysia, Philippines, Egypt and Canada) and international trading operations spanning several countries including Singapore, Dubai, Russia, Vietnam, Myanmar and China make it Indias first truly multinational conglomerate.

A US $28 billion corporation with a market cap of US $31.5 billion and in the league of Fortune 500, the Aditya Birla Group is anchored by an extraordinary force of 100,000 employees, belonging to 25 different nationalities. In India, the Group has been adjudged "The Best Employer in India and among the top 20 in Asia" by the Hewitt-Economic Times and Wall Street Journal Study 2007. Over 50 per cent of its revenues flow from its overseas operations. The Group operates in 20 countries: India, Thailand, Laos, Indonesia, Philippines, Egypt, China, Canada, Australia, USA, UK, Germany, Hungary, Brazil, Italy, France, Luxembourg, Switzerland, Malaysia and Korea.

Globally the Aditya Birla Group is:

:: A metals powerhouse, among the world's most cost-efficient Aluminium and Copper producers. Hindalco-Novelis from its fold, is a Fortune 500 company. It is the largest Aluminium rolling company. It is one of the three biggest producers of primary Aluminium in Asia, with the largest single location copper smelter. :: No.1 in viscose staple fibre :: The fourth largest producer of insulators :: The fourth largest producer of carbon black :: The 11th largest cement producer globally :: Among the world's top 15 BPO companies and among India's top three :: Among the best energy efficient fertilizer plants

In India:

:: :: :: :: :: ::

A premier branded garments player The second largest player in viscose filament yarn The second largest in the chlor-alkali sector Among the top five mobile telephony companies A leading player in life insurance and asset management Among the top three supermarket chains in the retail business

Rock solid in fundamentals, the Aditya Birla Group nurtures a culture where success does not come in the way of the need to keep learning afresh, to keep experimenting.

Beyond business the Aditya Birla Group is:

: Working in 3,700 villages : Reaching out to seven million people annually through the Aditya : Birla Centre : Focusing on: health care, education, sustainable livelihood, : infrastructure and espousing social causes : Running 41 schools and 18 hospitals

Factfile
The world's largest aluminium rolling company World leader in viscose staple fibre One of the biggest producers of primary aluminium in Asia Fastest-growing copper company in Asia The Aditya Birla Group is the 11th largest cement producer in the world. Fourth largest producer of carbon black in the world One of the lowest-cost producers of aluminium in the world ISO 9001:2000 and 14001 certified One of the lowest-cost producers of aluminium in the world

CHAIRMAN: Shri Kumar Mangalam Birla

People build companys success; where people grow, profits grow.

Group vision
To become a premium conglomerate with clear business focus at each corporate level.

Group mission
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To deliver value for our customer, shareholders, employees and society at large.

Group Philosophy
Reset on four pillars Customize People-size Strategize Institutionalize

Group values
Integrity Speed Seamlessness Passion

For more information visit Groups website: www.adityabirla.com.

COMPANIES UNDER UMBRELLA OF ADITYA BIRLA GROUP

Group companies:
Grassim Industries Ltd. Hindalco Industries Ltd. Aditya Birla Nuvo Ltd.
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 Ultra Tech Cement Ltd.

Indian companies:
PSI Data systems Aditya Birla Minacs Worldwide Ltd. Essel Mining & Industries Ltd. Shree Digvijay Cement Ltd. Idea Cellular Ltd. Aditya Birla Insulators. Aditya Birla Retail Limited Bihar Caustic and Chemicals Ltd.

International companies: Thailand:

Thai Rayon Indo Thai Synthetics Thai Acrylic Fibre Thai Carbon Black Aditya Birla Chemicals(Thailand) Ltd. Thai Peroxide.

Canada:
AV Cell Inc. AV Nackawic Inc.

Philippines:
Indo Phil Textile Mills. Indo Phil Cotton Mills.
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 Indo Phil Acrylic Mfg. Pan Century Surfactants Inc.

Indonesia:
PT Indo Bharat Rayon. PT Elegant Textile Industry. PT Sunrise Bumi Textiles. PT Indo Liberty Textiles. PT Indo Raya Kimia.

Egypt:
Alexandria Fiber Company S.A.E. Alexandria Carbon Black Company S.A.E.

China:
Liaoning Birla Carbon. Birla Jingwei Fibres Company Ltd. Aditya Birla Grasun Chemicals(Fangchenggang) Ltd.

Australia:

Aditya Birla Minerals Ltd.

Laos:

Birla Laos Pulp and Paper Plantation Company Ltd.

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North and South America, Europe and Asia:

Novelis Inc.

JOINT VENTURES
Birla Sun Life Insurance Birla Sun Life Asset Management Company Ltd. Birla Sun Life Distribution Company Ltd. Tanfac Industries Ltd

ABOUT HINDALCO
Vision
To strength our position as a premium Aluminum company, sustaining, domestic leadership and global competitiveness through innovation quality and value added growth.
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Mission To pursue the creation of value for our customers, shareholders,

employees and society at large.

Values
INTEGRETY: Honesty in every action. COMMITMENT: Doing whatever it takes to deliver, as promised. PASSION: Missionary zeal arising out of an emotional engagement with work. SEAMLESSNESS: Thinking and working together across functional silos, hierarchy levels, business and geographies. SPEED: Responding to stockholders with a sense of urgency.

Strategy

EFFICIENCY FOCUS: To be one of the lowest cost producers globally. EFFECTIVENESS FOCUS: To continue to remain the market leader domestically. GROWTH FOCUS: To pursue value adding growth opportunities.

Hindalco Overview
Hindalco was set up in collaboration with Kaiser Aluminum & Chemicals Corporation U.S.A, in a record time of 18 months. The plant started functioning in the year 1962 with a capacity of 20,000 tons per annum.
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The company has growth manifold and is managed by Board of Directors, with Shri Kumar Mangalam Birla as the chairman of the Board of Directors. Day to day affairs of the company are managed by Professional Executives headed by Shri Ratan K Shah as the chief operation officer-Aluminium & Power. Hindalco is one of Indias largest producers of Aluminium. The company was in corporated on December 15, 1958 and commenced production in 1962 with an initial smelting capacity of 20,000 TPA. Hindalcos integrated operation and operational efficiency have enabled the company to be one of the worlds lowest cost producers of Aluminium.

Hindalco Today
Aluminium has turned out to be the wonder metal of the industrialised world. No other single metal can do so many jobs, so well, and so economically. Aluminiums growth rate is the highest amongst the major basic metals today. Hindalco ranks as the largest Aluminium producer
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in India, whose more than 58% sales is in value added product and has more than 40% in total market share. Hindalcos integrated operations and operational efficiency have enabled the company to be one of the worlds lowest cost producers of Aluminium. Hindalco also owns a large captive thermal power plant at Renusagar that meets the power requirement of the company very effectively. Hindalco currently has primary Aluminium capacity of 3, 45,000 MTPA.

Joint venture companies of Hindalco

1. Indo-gulf Fertilizers & chemicals Corp. Ltd. 2. Bihar Caustic & Chemicals Ltd. 3. Tanfac Industries Ltd. 4. Mangalore Refinery & Protochemicals Ltd. 5. Birla AT & T Communication Ltd. 6. Bina Power Supply Co. Ltd. 7. Birla Global Finance Ltd. 8. Birla Capital International AMC Ltd. 9. Century Enka.

Recent Awards won by Hindalco in Different fields.

National Safety Award 2003:
By Minister of Labor and Employment.

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Rajiv Gandhi National Quality Award 2003:

Joint award winner of R.G.N.Q.A. 2003 in large scale manufacturing category. The award is instituted by Bureau of Indian Standard, Ministry of Consumer Affairs, Government of India.

Green Tech Gold Award 2003-04:

By Greentech Foundation, New Delhi for organizational Health & Safety.

CIOL Dataquest Award:

For best performance in the pioneer category for 2004-05 by CIOL, an IT portal along with Dataquest Magazine.

Qualtech Award 2004:

For Quality Management by

Quimpro college, Mumbai.

CII National Award:

For Excellence in Energy

Management - 2004.

Prime Ministers Shram Award 2004:

Shram Veer award to Mr. Ram Kailash of Aluminium plant won the Excellence Case Study Presentation Award at NCQC, Mumbai in December 2004.

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 IMC Rama Krishna Bajaj National Quality Award 2004:

Certificate of merit.

National Energy Conservation Award 2004:

In aluminium sector Government of India, Ministry of Power.

Aditya Birla Planet Award 2004:

Jt. Winner of Aditya Birla Planet Award 2004 for community initiative &Rural Development Works.

Our Mines Division has been reorganized by Indian Bureau of Mines, Government of India for A forestation; Plantation, waste Dump Management, Topsoil Management, Reclamation and Rehabilitation, Dust suppression Arrangement, Publicity & propaganda and overall Performance.

Training & Development (HR) Practices 2004:

Renusagar Power has declared winner of Innovation Training & Development (HR) Practices 2004. Award given by Indian Society for Training & Development, New Delhi.

Annual Greentech Safety Gold Award:

Hindalco own the 4th Annual Greentech

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Safety Gold award for the year 2004-05 in Metallurgy Sector. The award will be presented on 11th May 2005 at Hyderabad.

National Award for Excellence in Energy Management 2005:

Belure Sheet Plant received the National Award for Excellence in Energy Management 2005 (Energy Efficient Unite) from CII Sohrabji Godrej Green Business Center.

National Safety Award 2004:

Owned by Renukoot Plant, given by the Ministry of Labor and Employment, Government of India.

Vishkarma Rashtriya Puraskar:

Awarded

to Five workmen of our smelter, Mr. Rajesh Pal, Mr. A.K. Gupta, Mr. R.K. Singh, Mr. H.N. Singh, & Mr. S.K. Singh, given by the Ministry of Labor and Employment, Government of India.

National Energy Conservation 2005:

Renukoot plant won the 1st Prize in Aluminium sector, given by Ministry of power, Government of India.

ICWAI National Award for Excellence in Cost Management-2005:

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Hindalco was awarded by Institute of Cost and Works Accountants of India.

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FINANCIAL PERFORMANCE

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SALES REVENUE OF ALUMINIUM BUSINESS

CHEMICAL 10% FOIL&WHEEL 8% EXTRUSION 9%

PRIMARY 37%

PRIMARY ROLLED EXTRUSION FOIL&WHEEL CHEMICAL

ROLLED 36%

ABOVE FIGURE SHOWS THE SALES REVENUE OF ALUMINUM BUSINESS.

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OBJECTIVE OBJECTIVE OF STUDY COMPANY PROFILE

SIGNIFICANT AND SCOPE INDUSTRY AT GLANCE OF ALUMINIUM STUDY COPPER

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OBJECTIVE OF STUDY
This project was undertaken to have an insight into the distribution channel of Hindalco. The study aims to investigate the minute details of the distribution channel. An analysis of the various facts and figures has been done to arrive at logical recommendations. In short, at it can be said that this study has two-fold objective of knowing, what is the present distribution channel? And what should be the future distribution channel?

SIGNIFICANT AND SCOPE OF STUDY

The development in the field of transportation, communication and information on account of globalization has found charging the expectations of the customers. It is against this backdrop the marketing professionals need to assign due priority to the application of modern marketing principles in particular. An efficient Distribution Channel plays a vital role in the success of any organization. A distribution system has to be designed carefully, as it normally takes years to build and is not easily changed. This study provides a birds eye view of distribution channel of Hindalco. This report would do well to the entire person interested in learning about distribution channel of Hindalco. A general idea about Hindalcos presence in aluminium market is also well given by this report. After a through analysis of various facts and figures, a set of recommendations, with regard to the distribution channel, has
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been given in the concluding part of the report. The company would find it useful to look into the viability of the implementation of the recommendations, once implemented, and are expected to fetch immense benefits to the company. It is thus clear that this report would serve a variety of purposes and its scope is very wide and open.

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COMPANY PROFILE
INDUSTRY AT GLANCE
Hindalco industry limited, a flagship company of ADITYA BIRLA group, with a turnover of Rs.18313.00 crore in 2006-07, ranks among Indias top 10 companies in terms of capital market capitalization a non ferrous metal powerhouse Hindalcos operations are organized into two strategic business units Aluminium and Copper. The company is an industry leader in both these business.

ALUMINIUM
Hindalco is Asias largest integrated primary producer of aluminium and among the most cost efficient producers globally. In India, Hindalco enjoys a leadership position for aluminium and downstream products. Synergies of operations with its wholly owned subsidiary Indian aluminium company Ltd. (Indal), have enhanced the company share in value addition segments, in which the Hindalco Indal combine has a market share of over 50 %. As a step towards expanding the market for value added products and services, Hindalco has launched several brands in past year Aura, Freshwrapp, Everlast, and, Al plant. The companys product range includes primary aluminium ingots, billets, wire rods, rolled products, extrusions, and foils and alloy wheels. To enhance its capacities, the company had under taken Brownfield expansions, leading to smelting capacity of 1,46,000 tpa, an alumina refining capacity of 4,50, 0000 tones, and captive power generation of 167.5MW. The company further enhanced the smelter capacity of 4, 29,140MT and alumina refinery to 6, 60,000 tones, by streamlining to eliminate bottlenecks and installation of balancing equipment, including
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another co- generation plant. This has facilitated optimization of expand facilities and, more importantly, has been achieved within the original budget. Besides being a dominant player in the Indian aluminium market, Hindalcos products are well accepted in international markets. The companys metal is accepted for delivery under the high grade aluminium contract on the LME (London Metal Exchange). The companys export efforts have led to its reorganization as a Star Trading House. Hindalco is an ISO 9001 company, and has been awarded the ISO 14001certification for its entire operations at Renukoot and Silvassa, including its power plant and mines. It has received several awards from the export promotion council as well as the government of India. With the completition of on going Brownfield expansion, Hindalco will further consolidate its domestic market leadership, and reach out to international markets in larger measure.

COPPER
Birla copper enjoys leadership position in India, having built up-------percent domestic market share with in three years of commissioning. It has also made successful forays into the export markets of the Middle East, South East Asia, china Korea and Taiwan. Birla copper has a mega green field copper smelting and refining complex at dahej in the bharuch district of Gujarat, India. With an investment of Rs 1,850. Crore, it is largest of its kind in India. The plant produces world- class copper cathodes, continues cast copper rods and precious metals. Sulphuric acids, phosphoric acid, diammonium phosphate, other phosphatic fertilizers and phosphogypsum are also produced at this plant . Birla copper aspires to be among the worlds foremost cost competitive producers of copper. To reach this goal, it had under taken a brown field expansion raising its smelter capacity from
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65,000 tones per annum to 146000 tones per annum. The copper division is evaluating a further expansion as well, so as to rank among the top 10percent of cost competitive producer globally. To make birla copper an integrated producer of copper, the company believes that upstream expansion through ownership in mines is important for a smelter of its size. As a first step in this direction, birla copper acquired the nifty copper mines in Australia. Nifty currently has a capacity of 25000 tones per year of copper cathodes, with a large underdeveloped copper sulphide.

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PRODUCTION PROFILE
PRODUCTION PROCESS EXTRACTION OF ALUMINA FROM BAUXITE EXTRACTION ALUMINIUM FROM ALUMINA

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PRODUCTION PROCESS
The aluminum production process can be categorized into upstream and downstream activities. The upstream process involves meaning and refining bauxite to alumina while the downstream process involves smelting and casting and fabricating. Hindalco refines bauxite primarily obtained from captive mines, to extract alumina, which is smelted into alumina ingots or billets. Hindalco smelts its entire production of alumina into aluminum and does not engage in alumina trade.

Production of aluminum can be categories in two stages, namely

From bauxite to alumina From alumina to aluminum

EXTRACTION OF ALUMINA FROM BAUXITE

Alumina is manufactured by conventional bayers process i.e. treating bauxite with caustic soda. Bauxite is brought to the site from mines by means of railways wagon tippler. Primary crushing is done in cone crusher where bauxite size is reduced form 8- 12 to 3 - 4 and then stockpiled. Secondary crushing is done by means of hammer mills where process liquor known as a spent liquor and 600 psig. Steam is mixed together. This solution of alumina from bauxite into caustic solution in the form of sodium aluminates is carried out of digesters at 240 degrees centigrade temperature and 36-kg/sq.cm pressures.

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The digested slurry is placed flashed and brought to atmosphere pressure; flashed vapors are utilized for pre heating the spent liquor and condensed returned to boiler hose for generation of steam. Digested flashed slurry is pumped to clarification area for removal of solid Impurities (red mud). Red mud is separated out, in solid liquid hydrocyclon and stellar. Separated mud slurry is washed in counter current and washing Circuit without using water. Washed mud slurry is cauterized by treating with lime slurry to recover soda. Cauterized mud slurry is filtered on drum filters. Filtrate liquor is taken back into the system and red mud cake is disposed off by means of dumpers Settler overflow pregnant liquor is filtered in Kelly presses to remove fine mud particles. Clear pregnant liquor is pumped to precipitators through plate heat exchanges after exchanging heat with the spent liquor where it is seeded with alumina trihydrate. Alumina trihydrate is separated out in thickness and pan filter. Alumina trihydrate cake thus obtained is fed into the gas suspension calciner where furnace oil is burnt for calcining alumina. The reduction grade alumina thus produced is transported to smelter plant. Spent liquor generated and separated from precipitation circuit is fed to the evaporation unit for increasing caustic concentration to the desired level and recirculated to digesters through heaters for further processing of bauxite and thus the process goes on.

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EXTRACTION OF ALUMINUM FROM ALUMINA

Alumina from alumina plant is conveyed to the reduction plant. The reduction plant has 11 prebaked pot lines which have 1278 pot cells. Each pot has 24/26 carbon anodes and it is lined with carbon cathode. Alumina is converted to metallic aluminum is these pot cells by the standard hall heroult process. The pot cells work at an average 4.3-volt D. C. current of 5800/6300 amperes. Electrolysis of the alumina takes place in molten bath of cryolte at a temperature of 955 to 960 degrees centigrade. The molten aluminum that collects at the cathodes is siphoned into cruciblesperiodically. The entire process is controlled by microprocessor system.

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PRODUCT PROFILE
PRODUCT OVERVIEW ALUMINIUM COPPER PRIMARY ALUMINIUM PRODUCTS PRODUCTION CAPACITY

PRODUCT OVERVIEW
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Hindalco operations are organized into two strategic business unitsaluminum and copper. The company is an industry leader in both these businesses.

ALUMINUM

Hindalcos Aluminum business comprises primary aluminum, extrusions, rolled products, foils and alloy wheels. In the valueadded segment, hindalco, along with its subsidiary Indal, has a 50 percent market share. In the past year, hindalco has launched several brands Aura, Freshwrapp, Everlast, Permashield, and, Al Planet.

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COPPER

BIRLA copper, with an over 45 per cent market share, is India leading copper producer in private sector. Its plant at dahej in Gujarat, produces world class copper cathodes, continuous cast copper rods and precious metals. A part form copper products, euphoric acid, phosphoric acid, diammonium phosphate, other phosphates fertilizers and phosphor gypsum are also produced at this plant.

PRIMARY ALUMINIUM PRODUCTS

INGOTS:

Is an LME (London Metal Exchange) registered brand. These are also known as virgin metal. These are used as raw material for making aluminium product.
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ROUND BILLETS:

These are use for making extrusion.

CAST SLABS:

Slabs are used input in Hot Rolling Mill, which is converted into thinner sheets, plates or coils.

SEMI FABRICATED PRODUCTS:

Hindalco produces 900 different rolled product items of which 40 are standard.

HOT ROLLED PRODUCTS:

These are the product which are used after the process of hot rolling according to their specification and requirements, these products are as follows:

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Hot Rolled Plates:

These plates are supplied in alloys 6351, 5052, 5086. These are supplied flat with sheared milled.

Hot Rolled Plates For Electrical application: These electrical application

plates are used as Bus Bar. They are supplied in Alloy 1050, 1060 an 1070. Standard Temper is F (As Fabricated)

Hot Rolled Coils:

These are supplied in alloy 5005,

60611, 6351, 5052, 5086.

COLD ROLLED PRODUCTS

(A)PLAIN SHEETS (B)COLD ROLLED COILS

SLUG STOCK:

Hindalco also produces slug stock needed for punching slugs for the manufactured of collapsible tubes etc. They are manufactured in allow 1050, 1060, 1070, and in temper o.

CIRCLES:

This product is made as sheet cut to circular cross section before subjecting it to deep drawing or other form of operation.

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MILK CAN CIRCLE: CHECKERED SHEETS:

They are supplied in allow and temper o. They are used to make milk cans.

These checkered sheets are also known as flooring sheets because there are use to join floor in buses etc.

CIRCULAR CORRUGATED SHEETS:

Corrugated sheets are supplied in allow 3003, 40800 with temper 114. For roofing & siding, corrugated sheets in allow 8011 is ideal.

FOIL STOCK:

It is a semi finished coil strip used for further rolling to manufacture foils.

LITHO STOCK:

It is semi-fabricated coils used for lithography printing. Extremely high required with emphasis on almost complete absence of surface defects.

ALKALOID SHEET:

It is also known as brazing sheet and extensively used air passenger radiators, automotive air conditioning evaporators air condensers, alkaloid sheets consist of a Bramble

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Aluminium Allow (AA4045) Clade (10% of total thickness).

EXTRUSIONS
Hindalco extrusions offer an enormous range of shapes, wide range of alloys for decorative, structural and functional application. The present die catalogue included over one thousand die for various sections and we are fully equipped to design and make new die as per exclusive requirement. Some of the common shapes are as follows: ROD, BAR-Flat, Square, Hexagonal STRUCTURAL SHAPES-Angles, Channels, Tee, I-beans, H sections etc. TUBES-Round, Oval, Square, Rectangular, Triangular MOUDINGS SOLID AND HOLLOW SHAPES

FOIL
Cable Rape stock Light Gauge Foil Bare & Coated Fine stock Collapsible insulation Ducts

ALLOY WHEELS

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12 to 18 inch diameters. OTHERS: The main by products of the process included VANADIUM SLUDGE GALLIUM

THE MARKET LEADER

Hindalco is a leading domestic player in two metals business segments aluminum and copper. The aluminum division's product range includes alumna chemicals, primary aluminum ingots, billets, and wire rods, product extrusions, foils and alloy wheels. The company has a significant market share in all the segments in which it operates. It enjoys a domestic market share of 42 per cent in primary aluminum, 63 per cent in rolled products, 20 per cent in extrusions, 44 per cent in foils and 31 per cent in wheels. As a step towards expanding the market for value-added products and services, Hindalco has launched several brands in recent years, which include Aura for alloy wheels, Fresh Rapp for kitchen foil and Ever last for roofing sheets. Our exclusive showroom, The
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Aluminum Gallery, seeks to promote Hindalco products to its customers. It is a platform for the company to showcase quality products to a quality audience in an appropriate ambience. The exhibits include products like windows, doors, furniture, ladder, roofing sheets and ceiling and cladding panels. Hindalco products are well received not only in the domestic market, but also in the international market. The company's metal is accepted for delivery under the high-grade aluminum contract on the London Metal Exchange (LME). The company exports about 17 per cent of its total sales volume of aluminum.The company's alumna chemical business is a leader in manufacturing and marketing of specialty alumna and alumna hydrate products in the country. It has a market share of 90 per cent in the country. These specialty products find wide usage in diversified industries including water treatment chemicals, refractory, ceramics, cryolite, glass, fillers and plastics, conveyor belts and cables, among others. The company also exports these alumna chemicals to over 30 countries covering North America, Western Europe and the Asian region.

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Birla Copper, Hindalco's copper division at Dahej in Gujarat enjoys a leadership position in India, having built over 40 per cent of the domestic market share within three years of its commissioning. It has also made successful forays into the export markets of the Middle East, Southeast Asia, China, Korea and Taiwan. The copper plant produces world-class copper cathodes, continuous cast copper rods and precious metals. Sulphuric acid, phosphoric acid, DI-ammonium phosphate, other phosphate fertilizers and phosphor-gypsum are also produced at this plant.

PRODUCTION CAPACITY
ALUMINA:
CAPACITY 1.15 MTPA RENUKOOT 685,000TPA BELGAUM 350,000TPA MURI 110,000TPA

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SMELTER (PRIMARY ALUMINIUM):

CAPACITY 424,000MTP RENUKOOT 345,000TPA HIRAKUND 65,000TPA ALPURAM 14,000TPA

ROLLED PRODUCTS:
CAPACITY 2,00,000TPA RENUKOOT 80,000TPA BELUR 45,000TPA TALOJA 45,000TPA NAGPUR 30,000TPA

FOIL:
CAPACITY 14,000TPA SILVASA 5,000TPA KALWA 6,000TPA KOLLAR 3,000TPA

EXTRUSIONS:
CAPACITY 27,700TPA RENUKOOT 19700TPA ALPURAM 8000TPA

ALLOY WHEELS:
CAPACITY 3,00,000 Nos. PA SILVASA 3,00,000 nos.
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ALUMINIUM PROPERTIES
The major advantages of using aluminium are tied directly to its remarkable properties. Some of these properties are outlined in the following sections.

Strength to weight ratio

Aluminium has a density around one third that of steel and is used advantageously in applications where high strength and low weight are required. This included vehicles where low mass results in grater lode capacity and reduction fuel consumption.

Corrosion resistance

When the surface of aluminium metal is exposed to air, a protective oxide coating forms almost instantaneously. This oxide layer is corrosion, resistant and can be further enhanced with surface treatments such as anodizing.

Electrical and thermal conductivity

Aluminium is an excellent conductor of both heat and electricity. The grate advantage of aluminium is that by weight, the conductivity of aluminium is around twice that of copper. This means that aluminium is now the most commonly used material in large power transmission lines including domestic wiring. Weight consideration means that a large property of overhead, high voltage power lines now use aluminium rather than copper.

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Light and heat reflectivity

Aluminium is a good reflector of both visible light and heat marketing it an ideal material for light fittings, thermal rescue blankets and architectural insulation.

Toxicity

Aluminium is not only non-toxic but also does not release any odors or taint products with which it is in contact. This makes aluminium suitable for use in packing for sensitive products such as food or pharmaceutical where aluminium foil is used.

Recyclability

The Recyclability of aluminium is unparalleled. When recycled there is no digression in properties when recycled aluminium is compared to virgin aluminium. Further more, recycling of aluminium only require around 5% of the input energy required to produce virgin aluminium metal.

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APPLICATION OF ALUMINIUM IN CONSTRUCTION INDUSTRY

Aluminium & aluminium alloys have a number of properties, which make them ideal for use in building and construction industry. These properties include light weight combined with high strength, good resistant to corrosion, visual attractiveness without the need for panting, low maintenance and handling cost and in the case of structural, materials, reduces building time and cost as the materials are easier to handle, and involve the use of lighter, cheaper cranes and other materials handling equipment. Aluminium is used in the both the structure and fittings of residential and non-residential buildings. The main uses are roofing and cladding and in window & doorframes, but there are many other uses, some are as follows: Solar panels Cladding roofing Window door &general application Architectural hardware furniture Grills Ventilation blind Foil insulating Capping strip rain water guttering Shower boxes Mosquito nets Casemate window Ceiling system Roller shutter
47

IN PACKING INDUSTRIES
An aluminium metal can is used in a variety of products packing. Use of aluminium metal cans, include industrial products and consumer durable products; such as milk &milk products, fresh fishes, soft drink etc. . Innovation of aluminium foil has also a silent future in packing the products. Foil can be used as a household or commercial wrapping, either alone or in commercial wrapping, in the from of laminates with their materials. Foil containers are widely used for the packing of food, especially frozen food. Foil layers are important in paper based packing such as cartons for fruit juice. Wine boxes have foil containers inside them, which collapse as the contests are drawn off and prevent the ingress of air, which of air which oxidizes and spoil the remaining contents. Foil is used as on oxygen-tight seal in the packing of dry powders like coffee and foil seals are also under development to provide tamper-proof seals for pharmaceuticals. Many pharmaceuticals in tablet from are contained in foil packages, which permit individual tablets to be removed without opening the others up to the air. Major applications in the fields are as follows: Pharmaceutical packing Cigarettes foil Tea industries Tagger lids Aluminium cans for milk Dairy products packing Multiply laminates Electrical power applications
48

Decorative laminates Collapsible tube Powder & chemicals Colors Aseptic packing Beverage cans Flexible food packing Semi-rigid container.

IN TRANSPORT INDUSTRY
Aluminium alloys are used in the construction of almost all type of transport equipment. The most widely publicized application for aluminium is in aircraft, through this in one of the smelter application in term of the tonnage consumed. The largest end use in the road vehicles, both passengers car & commercial vehicles, and it is also used in railway rolling stock and in the construction of naval and merchant ships and small boats. The largest outlet for aliminium amongst road vehicles is in passenger cars, which though smaller than commercial vehicles are build in very large numbers. Such as: Aeroplane Commercial aircraft Passenger cars Bus and bus shelter
49

Railways Bicycles &bikes Ship &ship building Trucks Light motor vehicles

APPLICATION OF ALUMINIUM IN TRANSPORT SECTOR

Country Europe Japan US Canada Australia India % of consumption 29% 30% 28% 28% 25% 16%

50

IN AUTOMOTIVE INDUSTRY
The use of aluminium in construction of passenger cars is far from new. In the UK the ROVER Company has made extensive of aluminium in body work for over 40 years, starting with he LAND ROVER 1948 than notably in the ROVE 75 and ROVER90 series (1949-1964) and ROVER 2000. All the models of vehicles concerned, where by the standards of the times during which they were build, low volume models. Aluminium is still more widely used in low volume, high performance, highly priced models of automobiles then in the high volume production models, which account for most of the passenger car produce. The consumption of aluminium, and light weight materials in the manufactures of passenger car is governed by consideration of safety of fuel efficiency, in emission control and cost. Aluminium is used for a wide range of components. A variety of examples are available to show the range of components, which have been produced from aluminium. Currently, the European cars consume 70kg of aluminium compared to 120kg used in the US markets. In India, the use of aluminium in passenger cars stands on an average at 20 kg in comparison to 35-35kg witnessed in other developing countries. Today, the per capita consumption of aluminium in automotive sectors accounts for 22% of total per capita consumption of aluminium in India. Globally, the sector holds 25% of the total consumption. Examples of parts being converted from other traditional materials to aluminium include, but are not limited to the following: Wheels Hoods Deck lids
51

 Bumper beams Suspension parts, Break discs Break drum & other break components Radiators Cylinder heads & blocks Stearing housings Chryher designee engines Doorframes, sills, steps, roof bows, ride pots. Extrusions are used for flat truck beds, tanks, van bodies, dumpier bodies and other application.

IN AVIATION INDUSTRY
Aluminium alloys are widely used in military as well as in civil aircraft.. the development of aluminium lithium alloys that combine lightness of weight with increased strength is extending the use of aluminium in airframe construction. Alcoa estimates that aluminium lithium alloys were substituted for conventional alloys in BOING747, the weight reduction would be 14000lbs; which would permit a saving of 4 million gallons of fuel over the service life of aircraft. The use of aluminium is maintained by the development of improve aluminium alloy and of improved methods of fabricating them. In some instances, this development may lead to the use of aluminium alloys to replace other materials such as titanium alloys or composites, which are generally to be more likely to replace aluminium. Super plastic forming of aluminium alloys permits them to be used in preferences to composites in non structured application because their manufacturing processes are so cheap that the
52

cost of a comparable component manufactured using composite. Major applications are follows: Military & civil aircraft Airframe construction Aircraft gas turbines Spacecraft & satellites Missile & rocket components Light aircraft Micro light aircraft Hang gliders, etc.

IN SHIP BUILDING INDUSTRY:

The use of aluminium as a construction material for marine craft is now widely accepted although its use in large vessels is still not wide spared, the recent emergence of the auto \ passenger fast ferry has sparked an existing new era in marine transportation an dramatic growth in the construction of large aluminium craft. Aluminium is used for the fame a hull a vessels a rescue craft. The largest design of TRIUMPH rescue vessels used by the US coast guard service involves an all aluminium sheet are used in hull, the keel and the other components like engine mountings. Aluminium was selected in preference to fiber reinforced plastics because it provides superior water lightness an in preference to steel to achieve weight reduction. Aluminium is used for decks are generally in the form of extruded planks, which give better stiffness than plate over large flat areas without the need for extensive framing. Aluminium planks have important advantages, which assist
53

fabrication an encourage their use. In fighters, the increased the use of aluminium may permit carriage of increased payloads notably in containership in which the containers are stacked to very high levels above deck. Aluminium is used in hull & super structure of all vessels improves stability by reducing the waterline. The alternative way to achieve is this is by the increasing the size & displacement of the hull, which increases the drag and leads to a reduction in operating efficiency. A must larger application for e.g. is the use of aluminium alloy plate in the construction of cargo tank in liquefied natural gas tankers which has been reported to consume 4000 tones per ship of the A-5083 structural alloy. The use aluminium in competition racing yacht also encourages its use in construction pleasure craft.

IN RAILWAYS
The high strength to weight ratio of aluminium alloys makes them highly suitable for use in railway rolling stock, in which they reduce the tare weight to permit fuel saving and the carriage of increase the payloads. Aluminium alloys are also resistant to corrosion, which leads to savings in maintenance, and increase the service life of railway vehicles. The types of railways vehicle for which aluminium alloys are suitable include mainline, locomotives, passenger carriages and freight wagons. Aluminium alloys are also being considered for use in the magnetically levied trains, which have been introduced in some cities in recent years. ALCON, ALCO, ALUSUISSE, KAISER & REYNOLDS have all developed lightweight aluminium coal cars. These advantages of fuel economy an increased speed on return journey when the train runs empty.
54

Aluminium alloys are widely used in rolling stock for this type of railway operation. Because their lightness of weight permits faster acceleration and reduces breaking both of which are important in trains, which are required to provide the shortest possible journey time despite the need to make many intermediate stops, sometimes at intervals of only a few hundred meters. Aluminium car is 30% more expansive, but one- third lighter than its steel counter port. Its payload is around 10% higher & fuel consumption is significantly reduced. Aluminium is widely used in the best known higher-speed passenger trains in use and under development around the world. High speed passenger trains are used in FRANCE, the TGV makes extensive use of aluminium. Major applications are as follows: Wagons Doors Window Decorative frames, etc As example: METRO TRAIN in India.

IN ELECTRICAL INDUSTRY:

55

Annealed commercial grade aluminium with purity of 99.7% aluminium has an electrical conductivity 63.5% that of copper, but it has must lower density than copper. Aluminium has been used for overhead transmission of high voltage electricity. Aluminium is resistant to corrosion. It is almost universally used for high voltage bare overhead conductors and in some instances it is also used for the transmission tower they. Aluminium is almost suitable where space is not restricted and insulation is not required. High voltage overhead transmission lines are usually not insulated so the higher costs of insulating larger conductors avoided. Since aluminium provides the equating conductance more cheaply than copper, it is widely used in bare overhead conductors. Major applications are also in following electrical fields: Electrical components Accessories Cabinet frame Motor body Light fixture Cable core Electronic components Heat sink Telephone parts Transmission tower Transmission line.

IN CONSUMER DURABLES
56

Consumer durable goods included kitchen utensils and domestic electrical applications. One of the earliest applications of aluminium was in the manufacturing of kitchen utensils, notably saucepans. The properties, which make aluminium suitable for use in consumer durable products, includes its good thermal conductivity, its lightness of weight, its resistance to corrosion, the brightness of its appearance and the case of fabricating it, aluminium is use in components for many domestic electrical appliances such as cookers, refrigerators etc. Major applications are also in following fields: Cookers Refrigerators Freezers Vacuum cleaners Washing machines Dishwashers Tumble dryers Ice tray & grid Scoops Paddles Stove top pots Steam jacketed kettles Gas fired kettles Dry & steam irons A.C Filter grill Panels Water filter Furniture Modeled language
57

 Hangers Letter plates Poultry channel Solar channel Watch case Tray etc.

APPLICATION OF ALUMINIUM IN INDIA

58

AUTOMATIVE INDUSTRIES AEROPLANE &AIRCRAFT INDUSTRIES RAILWAYS SHIP BUILDING INDUSTRIES TRANSPORTATION INDUSTRIES DAIRY INDUSTRIES PACKING INDUSTRIES ELECTRICAL INDUSTRIES HOUSEHOLD UTENCIL CONSUMER DURABLE PRODUCTS etc.

Global Aluminium Production Growth forecast (mln TPA)

Year 1985 1995 2005 2008 2010 2015 Actual 15.5 19.7 31.4 Forecast

37.8 41.3 50.2

PRIMARY ALUMINIUM PRODUCTION & CONSUMPTION BY MAJOR COUNTRIES IN 2005

59

Country Norway Brazil Australia Canada USA Russia China

Production (KT) 1376 1499 1903 2894 2480 3647 7806

CONSUMPTION( KT) 246 759 380 803 6143 946 7119

PER CAPITA CONSUMPTION OF ALUMINIUM

COUNTRY JAPAN USA GERMANY CANADA ITALY FRANCE AUSTRALIA UK CHINA BRAZIL INDIA CONSUMPTI ON (kg/person) 32.0 31.9 31.6 31.2 29.5 21.4 21.2 15.0 6.5 4.1 1.1

60

35 30 25 20 15 10 5 0 CONSUMPTION (kg/person) JAPAN USA GERMANY CANADA ITALY FRANCE AUSTRALIA UK CHINA BRAZIL INDIA

INDIA-User Segments Growth FY07 over FY06

User Segment Electrical FY 05 398 FY06 490 Chang e% 23
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Transport Buil. & Const. Consumer Durable Packing Indus. Machinery Others Total

234 135 46 47 37 37 934

308 165 53 51 41 41 1149

32 22 15 9 11 11 23

F Y0 5

F Y0 6

4% 4% 5% 5% 43 % 14 % E lec tric a l T ra ns p o rta tio n B u il. & c o ns . c on s u m e r d ura b le p ac king In d . Ma c h in a ry O th er 2 5%

5%

4%

4% 4%

42% 14%

E le c tric a l Tra ns p o rta tio n B uil. & c o ns . c o ns um e r d ura b le p a c k ing Ind . M a c hina ry O the r

27%

Major Aluminium Producer Industries in India.

Company Own ershi p AB Location Capacit y 345,000
62

Hindalco

Renukoot

Grou p NALCO Publi c Sect. Sterlight Sterli ght

Alpuram Hirakud Belgaum Angul

14,000 65,000 31,000 345,000

BALCO MALCO

Korba Mettur

350,000 40,000

EXTRUSIONS CAPACITY, PRODUCTION & DEMAND 1991-2020(MT)

Particular s Capacity Productio n Domestic Demand Export Excess Capacity 91-92 122000 61000 60000 Nil 62000 99-00 190000 109000 105000 4000 81000 03-04 202000 132000 117000 15000 70000 2010 202000 188000 166000 22000 14000 2020 400000 370000 325000 45000 30000

63

RESEARCH METHODOLOGY
SAMPLING PLAN SOURCES OF DATA PRIMARY SOURCES SECONDARY SOURCES

RESEARCH METHODOLOGY

64

SAMPLING PLAN:
There is no sampling plan as such as the study involved in understanding the various processes and analyzing them. The study involved in the detailed analysis of secondary data calculated from various sources and therefore no sample size and plan has been considered.

SOURCES OF DATA:
Data has been collected through literature survey and expert opinion. The part of data is collected from various primary sources and secondary sources.

PRIMARY SOURCES:
Information gathered through interview and discussing with departmental members.

SECONDARY SOURCES:
Annual report of HINDALCO Fy2006-07, 2007-08 and individual contra sheets of aluminum and copper for the year2006-07 and 2007-08.

DISTRIBUTION CHANNEL

Internet.

A CONCEPTUAL FRAMEWORK CHANNEL SELECTION FRAMEWORK Induction guide. MARKET SEGMENTATION OF HINDALCO DISTRIBUTION PROCESS AT HINDALCO FACTORS FINDINGS SUGGESTION/RECOMONDATION/CONCL USION
65

A CONCEPTUAL FRAME WORK

CONCEPTUAL FRAME WORK

66

A set of interdependent organizations involved in the process of making a product available, or reached the target market or consumers. Smooth availability of our products to the right customers, at a right place, at a right time with safe & secured quality and quantity is an important task for the customers satisfaction or goals of an organization. Organizations are spending a huge amount, about 25 to 35% of the cost of products. Most producers do not sell their goods directly to the final users stands a marketing channel, a host of marketing intermediaries performing a variety of functions and bearing a variety of names. Thus, A channel of distribution for a product may be define as a route taken by the title to the goods as they move from the producer to the ultimate customers or industrial users. The primary objective of channel of distribution is to bridge the gap by resolving spatial (geographical distance) and temporal (relating to time) discrepancies as to supply and demand.

CHANNEL OBJECTIVES:
Making smooth availability of product to the target market. Achievement of the best possible coverage of the target market.
67

 Ensuring that the consumer incurs the minimum extenuation in procuring the product. Safe in quality & accuracy in quantity. Quick services. Ensuring that the firm is able to carry on with its manufacturing activities, confident that the channel will take care of the distribution job. Ensuring that the distribution is cost effective. The primary objective of channel of the distribution is to bridge the gap by resolving spatial (geographical distance) and temporal (relating to time) discrepancies as to supply and demand.

ROLE OF CHANNEL MEMBERS:

Channel members are not play only the role of sales the products to the customers but also play the role as they promote the products, gathering the customer interest, complaints, suggestion, and information to the organizations they are work as the co-ordination between the targeted customers & manufactures. Members of the marketing channel perform many key functions as follows: Gathering & distributing marketing research and intelligence information about actors & forces in the marketing environment. Helpful in making marketing strategy. Developing & spreading the promotional offer of company and promote the sales activity. Easily make a sales contact with the customers. Intermediaries are taking the title to goods, so they invest the fund.

68

 Through the intermediaries, manufactures are made physical distribution of goods. Intermediaries are taking various type of risks, in the term of storing, dispatching etc.

CONTRIBUTION OF CHANNEL:

Make available on time. Reduce the cost of distribution Save the distribution time. Helpful in product design & developments. Flow of feedback from consumer. Flow of money consumers to manufacture.

VARIOUS TYPES OF CHANNEL LEVELS:

While a marketers wants to sell or marketing about the products or services, requirement of design a distribution channel to make product & services available to customers in different ways. In the process of distribution of products, each layer of marketing intermediaries are performs some work in bringing the product and its ownership closer to the final buyer is a channel level. Generally two methods of distribution are in the practices. 1. DIRECT MARKETING CHANNEL 2. INDIRECT MARKETING CHANNEL

DIRECT MARKETING CHANNEL:

DMC is a marketing channel that has no intermediary levels. Manufacture or sellers are advertise their product through the
69

various method of advertising & make awareness about the products, then contact to the needful customers through their salesmen, internet, e-mail, telephone or by post.

MANUFACTURES

CUSTOMERS

INDIRECT MARKETING CHANNEL:

IMC is a channel containing one or more intermediary levels. Manufactures or sellers are appointed various type of marketing intermediaries in the context of nature of the products & segmentation of markets.

CONSUMER DURABLE PRODUCTS

MANUFACTURER MANUFACTURER MANUFACTURER

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DEPOTS, C&F AGENTS

DEPOTS, C&F AGENTS

MANUFACTOR S OR MEMBERS SALES REPRESENTIV E

DISTRIBUTORS

SUPER STOCKIEST POINT

DISTRIBUTORS

EXCLUSIVE SHOW ROOM

RETAILERS RETAILERS RETAILERS

CONSUMERS

CONSUMERS CONSUMERS

INDUSTRIAL PRODUCTS
MANUFACTURER 71

MANUFACTURER

DEPOTS, WAREHOUSES

BUSINESS DISTRIBUTORS

REGIONAL SALES OFFICES, AREA SALES EXECUTIVES

CUSTOMERS

CUSTOMERS

TYPES OF CHANNEL MEMBERS

72

C & F AGENTS:
It means clearing & forwarding agents. They are responsible for storage & transportation of the companys products and its distribution to the distributor and some time retailers.

DISTRIBUTORS:
A distributor is usually appointed by the company and does not sell its competitors products. He can also be a distributor of many products of the same company. A distributor is responsible for ensuring that his companys product is available at the retail stores. The distributor is very much an extension of the company as he ensures that the market is properly served. A company has direct control over the distributors. Some of the following type of wholesalers:

MERCHANT WHOLESALERS:
Purchase and resell merchandise He has title to merchandise. He provides wide range of services.

FULL SERVICE WHOLESALERS:

Perform full range of distribution services. Provide trade credit; offer promotion assistance, personal sale force, and communication of information. Provide installation and services.

RACK JOBBER:

Deals with highly promoted items.

73

 Furnishes rack and shelves, price the goods, keep them fresh, set up point of purchase displays. Sell on consignment. Provide services as delivery, shelving, and inventories caring.

LIMITED FUNCTIONS WHOLESALE

Not provide credit, marketing research information and merchandising assistance.

MERCANDISING AGENTS & BROKERS:

They usually perform fewer services than merchant wholesalers do. Merchandising agents and brokers do not take title to product but negotiate sales for manufacture, they represent.

MANUFACTURERS AGENTS
They are free to work for several manufactures. They carry non-competitive, complementary products in exclusive territories. They do not provide credit facility but at times store and deliver products. Also provide research aid and promotion support.

BROKERS:
To bring buyer and seller together To assist in negotiation. They have not title to goods. But they provide the facility of financing.
74

 COMMISSION MERCHANTS
Received goods on consignment. They have not title to goods. To accumulate them from local markets & arrange for their sales. Offer credit & storage goods facility. To provide sales force & research aid. They do not normally promote the goods.

MANUFACTURERS SALES FACILITIES

Established by manufacture. It is separate from manufacturing operations. Its performing the wholesaling function himself. Generally used in industrial customers.

Types of manufacturers sales facilities: MANUFACTURERS SALES BRANCHES

Carry inventoryPromote the sales activities Sell to retail outlet.

MANUFACTURERS OFFICE (Regional Sales Office)

It does not carry inventory Perform market research, demand forecasting, etc. Collect orders from customers. Make delivery to customers from manufacturing point
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 Collection of payments. Dispose all the disputes or claims.Create better relationship.

MANUFACTURER

DEPOTS OR WARE HOUSES

CLEARING & FORWARDING AGENTS

DISTRIBUTERS OR WHOLE SALERS

MERCHANT WHOLESALERS

MANUFACTURERS SALES FACILITIES

MERCANDISING AGENTS OR BROKERS

Full Service Wholesalers Rack Jobbers

Limited Function Wholesaler

Manufacturers Agents Brokers

Commission Merchants

Manufacturers Sales Branch

Regional Sales office 76

THE CHANNEL SELECTION PROCESS

STEP-1 Identify Target Consumers

STEP-2

Determining Consumer Buying Habits For The Types Of Goods

STEP-3

Locate Potential Customers

STEP-4

Pinpoint Channel Alternative

STEP-5

Evaluate Channel Alternative

STEP-6

Select Channel Members

CHANNEL SELECTION PROCESS

77

EVALUTION OF THE DISTRIBUTION ENVIRONMENT:

Selection of channel model has to be necessarily take into account the distribution environment obtaining in the country/ region and in the specific business in which the firm is engaged. A firm has to evaluate the vital features of the distribution environment and ensures that the channel model to be adopted is compatible with them. Distribution environment in the border sense includes the legal environment as well in so far as its implications and distribution are concerned.

EVALUTION OF COMPETITORS CHANNEL PARTERNS

The firm should also study the competitors channel patterns before deciding its channel. While the firm may not necessarily follow the competitors it will be worthwhile for the firm to analyze in depth the plus and minus of the channel patterns adopted by each of the major competitors.

EVALUTION OF COMPANY RESOURCES AND MATCHING THE CHANNEL TO THE RESOURCES:

On the other hand firm with larger resources and large size marketing operation will be in a position to go in for highly intensive distribution committing a good deal of resources to the distribution task.

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IDENTIFICATION OF ALTERNATIVES CHANNEL & SELECTION OF THE ONE THAT SUITS THE FIRM BEST:
Two important considerations are cost and efficiency. Often though not necessarily they are directly proportional. The channel that its efficient but relatively less expensive has to be chosen. Two types of evaluations an economic evaluation and a conceptual evaluation may be necessary. The firm should also examine whether the channel member s in the desire alternatives would be willing to work enthusiastically for the firm and the product.

ANALYSING THE PRODUCT CHARACTERSTICS AND LINKING CHANNEL TO THE PRODUCT:

The firm should analyze the characteristics of the product and choose the channel designee that is most suited to the product. Within each of these broad categories of product channel choice can very in relation to specific products/product types. The products futures, after all changes in a graded manner as on move through the spectrum from the simplest consumer soft to the most complex among industrial equipment.

NOTES:
Consumer products Vs Industrial products. The case of industrial products. The product must have a sizable customer base. It must be standardized to a reasonable extent. It must be stock able items. The unite value should not be too high. It should not be complex.

Need for specialized distributor must be appreciated; after considering all such factors, if a given industrial product lends itself for marketing through distributors, it must still remembered that;
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 As a general rule industrial products require specialized distributor and entrusting them with the general-purpose (consumer product) distributors does not produce the best result. Different industrial products need different types of distributors. Establish relationship and use problem-solving techniques for prevention of crisis and preventing customer dissatisfaction. Gather quality intelligence on customer dissatisfaction and provide this information to management.

ON TIME DELIVERY
Consumer will be happy, if the material is delivered on time. OTD has come into sharper focus, for it has become a competitive weapon in all most all industries. For example Nissan offers a guaranteed ten-day delivery to its dealers, Caterpillar deliver replacements parts within 72 hours.99.7% of time

OTD customer satisfaction gap has three components

Calibration Gap Operations Gap Organization Gap

CALIBRATION GAP:
The customer may measure OTD in different manner as copier to the supplier. It may so happen that the supplier may measure OTD by product category but the buyer may measure it in terms of complete order. The customer may measure OTD in terms of the initial order date where as then supplier may measure it from a negotiated date.

OPERATION GAP:
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Businesses that face variability from one manufacturing phase to another or from operations to ware house normally have an operations gap. Operations gap can also result from too many stages in production process, too many supplier or too many people involved in order filling.

ORGANISATION GAP:
If people do not have incentives to improve OTD it will probably result into organization gap. In other words organization gap result from the priority accorded to OTD.

MARKETING STRATEGY
OLD STRATEGY

Marketing Head office (Renukoot)

EAST

WEST

NORTH

SOUTH

Vice-President Vice-president

Vice-President

Vice-President

Extrusions

Rolled

Primary

Sales Manager (Territory Manager)

ADVANTAGES
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 Cost effective Geographical area oriented. Focus on all products simultaneously.

DIS ADVANTAGES
Product promotion scheme is not applicable. Lack of information about a particular product. Over work load. No more time & scope for a particular product. Consumer satisfaction is not appropriate.

The above old structure was not taking much advantage of the new global market. Analysis of the advantage and disadvantage of the regional based marketing strategy, it is not suitable in modern marketing specification era. So that, in 2003 company decided to go for opting the new marketing strategy based on product specification. For this the company transferred its marketing head office from Renukoot to Mumbai.

The new marketing strategy structure is as follows:82

MARKETING HEAD OFFICE (MUMBAI) CMO* (CHIEF MARKETING OFFICER)

EXTRUSIONS
Vice-President

ROLLED

PRIMARY

EAST Regional Manager

WEST

NORTH

SOUTH

T.M T.M T.M (Territory Manager) *Mr.Mudgal

ADVANTAGES
Its product based.. Emphasis on more customer satisfactions. Helpful to increasing the sales performance of various products of product line. Helpful to production processes to delivery the products. Accumulation of small customers. Provide quick service to customers. Enhance the sales promotion.

83

DISADVANTAGES
Cost ineffective. More men power required.

MARKET SEGMENTATION OF HINDALCO

The market for Aluminium products in India is very widespread Geographically By diversified of end user Further, there are a large number of small and medium consumers and a select a few large consumers. The smallest consumer would be consuming as little as 1MT/Month. However, the largest numbers of Hindalcos customers are in the consumption range of 5-50 Mts./Month. Aluminium is being used in around 3000 products in developed countries like USA, Japan, Canada, etc. Where as India, only around 350 products find use in aluminium. Moreover, the per capita consumption of aluminium in the country is very low (1.1 kg/year). Hence there is large potential for introducing the new uses and the increasing the consumption. As a strategy therefore, Hindalco decided to cater to as many consumers as possible. Their distribution system therefore, is designed to the object. Hindalco manufacture the products with very specification as desired by the various customers. Hindalcos market may be segmented in the following manner.

84

(A) MARKET SEGMENTATION BASED ON THE PRODUCT GROUP

On the basis of product groups, Hindalco market may be segmented in the following manner

PRIMARY PRODUCTS
Ingots Wirerods Billets

ROLLED PRODUCTS
Sheets Chequered sheets Roofing sheets Coils Hot Rolling plates Circles

EXTRUDED PRODUCTS
General solid sections Tubings Structurals Architecturals Mouldings

FOIL
Cablewrap stock
85

 Light gauge Foil Bare & Coated Finstock Collapsible Insulation Ducts.

ALLOY WHEELS (AURA)

12 to 18 diameters.

(B)

MARKET SEGMENTATION ON THE BASIS OF PRODUCT WISE KEY CONSUMERS.

PRIMARY PRODUCTS CONSUMER:

Value added aluminium sheet producer industries. Foil Producer Industries. Extrusion Producer Industries. Electricals EquipmentAutomobile Industries Smelter pot lining.

ROLLED PRODUCTS CONSUMER:

Foil & Packing Industries: box, cop, and container. Electrical Industries: bulbs, tube lights, fan blade etc Transportation industries Building & construction sectors roofing flooring etc. Defense & Marine sectors. Transportation sectors. Consumer durable: flooring & roofing General engineering:
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 Pilper-proof bottle cops Pressure cookers, non-stick cookware.

EXTRUDED PRODUCT CONSUMER:

Automobile Industries Building & construction Sector Mines & defence Sector Transportation sectors Electrical sectors Architectural sectors Furniture sectors House holds consumer durable

FOIL CONSUMER:

Packing sectors (printed & multi-laminated) Pharmaceuticals Dairy products Processed food Con-fectionery Personal care products Cigarettes Box rapping Air conditioner Auto mobile radiator Collapsible Insulation Ducts.

ALLOY WHEELS CONSUMERS:

Automobile sectors Maruti Suzuki TATA Motors FIAT India

87

 Hindustan Motors TelcoFord India Hundai India GM India etc

(C) MARKET SEGMENTATION BASED ON THE DEMAND PATTERN.

Based on size & frequency of order, Hindalco market may be segmented as follows:

BULK CUSTOMERS
Bulk customers are those customers, whose demand is very high and consistence. Some of the bulk customers are Howkin, TTK, Foil Division Silwassa, Jugraj Tejraj, Bajaj Auto, etc.

SMALL & MIDIUM

Small & medium customers may be bracketed as those customers, whose demand is comparatively low and not so consistence, some of the small customers of Hindalco included ITI Allahabad, Defense Organization, Dockyards etc.

88

(D) MARKET SEGMENTATION BASED ON THE PRIORTY:

On the basis of priority given to various orders Hindalco market may be segmented in the following manner:

ROUTINE CUSTOMERS Routine customers are those customers, who are regularly sourcing the company. Their orders are processed in the normal course of working. SPECIAL CUSTOMERS Special customers are those customers, whose orders are for products under developments. Since their demand is usually urgent in nature they are given priority under routine customers. Examples: Export Customers, Government organization like Defense, Establishment etc. continue this category.
(E) MARKET

SEGMENTATION CONSUMPTION SECTOR.

BASED

ON

Uses of aluminium metal are every where. It is not easy to categorize in some particular heads. However, we categorize in the following major sectors. Electrical Transportation Building & constructions Industrial Machinery Packing Consumer Durable
89

Other

(F) MARKET SEGMENTATION BASED ON GEOGRAPHICAL AREAS:

Aluminium consumers are spread all over the country. Different area have different type of industries, whose are used aluminium in different quantity. Here, segment the market in geographical areas based on consumption or demand pattern.

(G) TRANSPORTATION FACILITY

Smooth transportation facility is available all over the country all the time. Some area are affected by flood.some areas are block in the case of heavy rain etc.

DISTRIBUTION PROCESS AT HINDALCO

There are different tasks involved in distribution process These are as follows: Order processing Packing & Insurance, Banking, Bills, Ware housing Transportation Godown sales procedure..

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ORDER BOOKING:
Every purchaser has to book his order giving details which aluminium rolled products they want such as Plain sheet, Cold rolled coils, milk can sheet, circles, etc. Purchaser should be fully disclose about the product such as, product name, quality, quantity, technical data, mode of transportation, desire delivery time, payment mode etc. Technical wing of Hindalco examines their application and if necessary also make inspection of the facing and decided quality to be offered. Thereafter, terms of payment finalised and his order is finally booked. This order is passed to the relevant personnels officials with relevant details.

PRIORITY:
A priority list of all categories of consumers has been fixed in consultation with all concerned. Consumer gets delivery in order to their priority, which is also followed by transporting agents.

ORDER PROCESSING:
Hindalco procure order either directly from the customers or through the agents/stockiest. The order contains the name of product, quality, size, clearance etc. After the receipt of orders from the customers or agent Company scrutinizes the order. A production planning programmed is prepared for rolled production monthly basis. This monthely report is sent to the respective production department i.e. rolling mills by the end of the proceeding month. The produced material is sent to the inspection and packing department.

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WARE HOUSING:
Every has to store to goods while they wait to be sold. A strong function is necessary because production and consumption cycles rarely match. Ware housing is the responsibility of warehouse incharge in Hindalco. The work start when warehouse officials receive finished goods from production. Hindalco warehousing incharge dispatches the material to respective customers on advice of CSMO and follows the guidelines given to them. The guidelines are:

At warehouse:
While taking delivery from inspection & packing to ensure packages are intact & dry. If packages are damaged or loose condition, get it repacked. If packages are wet, do not accept it.

During loading at warehouse :

Trucks floor should be clear and flat. There should not be any hole or damage in the floor of the Trucks Floor should be covered with Tarpaulin. Packages being loaded should be intact and dry Proper stocking of packages should be done while loading. Heavy packages to be kept at bottom and lighter packages over heavy.

Packages:
No vertical stoking of packages. After loading truck should be covered with tarpaulin.

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During Storage:
Out doors storage should be avoided. Do not store packages directly on the floor, use wooden pallets. Cheek condition of metal every few hours to ensure no water condensation.

DELIVERY OF MATERIAL:
They deliver the material as per the delivery order. Then they note down the delivered material in the godown register. Then they send delivery report daily to zonal office.

BANKING INSURANCE DOCUMENTS:

BILLS

&

OTHER

Hindalco enjoys the facilities of three public sector banks & private sector bank in its town Renukoot. United Commercial Bank (UCO Bank). State Bank of India (SBI). Allahabad Bank. Industrial Development Bank of India (IDBI). Banking services at Renukoot is punctual. Banks help the company in carrying the documents to the party. It helps in quicker payments relisation.

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INSURANCE
Every material is dispatched duly insured. There are two types of insurance. Carrier Risk. Owner Risk. Hindalco arranges insurance facilities for its customers. If there are any damages in transportation they will issue a damage certificate & the customer can claim its insurance company on the basis of damage certificate.

GODOWN SALES PROCEDURE

Godown sales procedure describes the sales procedure of Hindalcos products through its godown. The respective zonal head exercise control over all activities related to godowns sales. This sales procedure is followed by all the godown of company situated at Delhi, Faridabad, Chandigarh, Jaipur, Haryana, Bangalore, Hydrabad, Calcutta Gohati, Mumbai, Silvasa, Taloja There is a clearing agent in the godown, which is appointed by Hindalco for the operation & maintenance of the godown.

VARIOUS MODES OF DISTRIBUTION IN HINDALCO

Hindalco emphasizes on , Taking the product to the market Distribution of products in Hindalco is carried out through a network of zonal offices, Area offices, Agents, Stockiest and company operated Depots, located through the country. A brief description is given below
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1. ZONAL AND AREA OFFICES: Hindalco has established five zonal offices, in various part of country. There is a network of area offices, functioning under various zonal offices. Zonal offices carried out various Marketing Sales functions of company. They provide following functions: Signed a contract between the zonal offices and customers, regarding to details of products such as quality, packing, transportation, destination, etc. Clearly mentions about the mode of payments. Eliminating intermediaries. Make a direct contact with the customers Help the company to cater to the need of customers. Helpful the company to earn additional profits

2. AGENTS Agents are those persons/institutions, who provide orders to Hindalco, on behalf of the customers. The company has appointed a number of agents, all around the country to sell the products. They are paid commission on the generated sales. Agent being a local person/ institution can use his contacts and influence, to generate sales in a local market. Agents function as an important mode of distribution, as they enable the company to minimize distribution costs.

3. STOCKIESTS
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Hindalco appointed a number of stockiest in various geographical areas across the country. Certain products of the company are sold through the network. Stockiest are made conform sale for the company. Stockiest is free to make sell to any customer Free to charge any price from customers Helps the company to cover the wide geographical market. Helpful in minimizes extra distribution setup costs.

4. DEPOTS HINDALCO operate 15 depots in various part of the country. Depots send the various requirements at the work office and thud, maintain suitable inventory to cater to the demand of the market. This is provide the following advantages to the company & also the customers: TAX-SHIELD: In many states, state sales tax is less then the central sales tax. In these states sales of products through depots, lead to tax saving. AT RANDOM DELEVERY: Emergency needs of customers full filled immediately by the depots, at a premium price small offtakes of the scattered customers can also be provided easily by the depots. HELPFUL IN PRODUCTION: Depots provide a foundation to the production department, by keeping inventory of the various products. For example, in the even of surplus stock, products can be transferred to the various depots. Similarly, Production Schedules can be planned with greater accuracy, with the help of estimated requirements, sent by depots.

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ZONAL OFFI CUSTOME R HINDALC O

AGENT/STOCKIST

PLANT

PRODUCTION

INSPECTION & PACKAGING

GODOWN

WAREHOUSE

CUSTOMER

DESPATCH

AGENT/STOCKIST

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MAJOR DOMESTIC MARKETS (GEOGRAPHYCALLY)

In order to cater the demand of geographically scattered market, Hindalco has broadly divided its domestic market into the following five zonesZONE OFFICE NORTH SOUTH EAST WEST ZONAL SALES & MARKETING DELHI BANGALORE KOLKATTA MUMBAI

Registered Office: Hindalco Industries LTD Century bhavan 3rd floor Dr.Annie Besant Road

Corporate office: Aditya Birla Center S.K.Ahire Marg Worli

Worli Mumbai 400030 Mumbai 400 030 Tel: 91-22-6652 5000/24995000 Tel: 91-22-6662 6666 Fax: 91-22-6652 5841/24995841 Fax: 91-22-2436 2516 / 2422 7586

Marketing head office

Century Bhavan, 3rd floor Dr. Annie Besant Road Worli Mumbai 400 030 India Tel: 91-22-6662 6666 Fax: 91-22- 2422 7586
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Regional offices North Vandhana, 5th Floor 11 Tolstoy Marg New Delhi 110 001
Tel: 91-11-4220 0200

East industry House, 9th Floor 10, Camac Street, Kolkata

Tel: 91-33 2282 6130

Email: nutansingh@adityabirla.com Email:suresharg@adityabirla.com

South
Industry House, 7th Floor 45, Race Course Road Bangalore 560 001 Tel: 91-80-4041 6000

West
Ahura Center, 1st Floor 82, Mahakali Caves Road Mumbai 400 093 Tel: 91-22 6691 7059

Email: jshankar@adityabirla.com Email:sanantharam@adityabirla.com

CONSIGNMENT AGENTS & STOCKIEST

ZONE EASTERN WAREHOUSE No of No of S CONSIGNMEN STOCKIEST T AGENTS 2 6 8 12 26 32 20 24

NORTHER 5 N SOUTHER 3 N WESTERN 3

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THE SWOT ANALYSIS OF HIL.

STRENGTH
Global brand image. Cost effective producer. Sound financial position. A high degree quality consciousness is the core competence of the company, ISO 9001 and ISO 14001 have added more prestige to the company. Integrated production facility at Renusagar power plant. Company has a well-established distribution network, covering a geographically wide and scattered market. A number of Brownfield & Greenfield projects. Industrial peace as, there has been no major strike in last 22 year. A well focussed human resources development. Serve maximum customer satisfaction.

WEAKNESS
Present production capacity is not adequate to meet the rising high demand. Technology is not upgraded to mark as compare to global giants in aluminium industry.

OPPORTUNITY
R & D collabratation with universities and another research organization. More emphasis on down stream production of value added products. Recycling should be adopted as routine production.
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 Raising more finance from marketing for more acquisition and merger for consolidating position in the global market. Aluminium, continuous to be strong with a growth in transportation sector 16%, construction15%, passenger car 25%, two wheeler segments 14% respectively during FY07.

THREATS
Strong domestic and global competitors, such as TATA, POSCO, MITTLE, ESSAR . Innovative revolution in plastic and steel industry. Reduce in exide duty. Fall in price of Al. In neighbor country.

OPPORTUNITY STRENGTH

DISTRIBUTIO N CHANNEL

SOLUTION

WEAKNESS

THREATS

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SWOT ANALYSIS OF DISTRIBUTION CHANNEL

STRENGTH
Product based marketing channel. Strong dist. channel based on geographically wide & scattered market of India.. Flexible distribution process for customers via direct sales and indirect sales. Company made more than 50% direct sales. Convenient road transportation.

WEAKNESS
Not tapped all the potential areas especially in eastern and southern zone. A 50-40% sale depends on indirect marketing. The present distribution system is not adequate to meet the demand of aluminium in the coming years. It is in this light, that the present dist. system needs to be updated. Certain recommendations, with regard to the same have been suggested ahead.

OPPORTUNITY
The demand of the companys products is rapidly increasing. Thus, there is a necessity to expand the dist. network to avail the benefits of the fast growing market. Indirect sales should be convert in direct sales through TM sales force.

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THREAT
The major threat is from the competitors like BALCO, NALCO etc. because the company may loose its market leader position , if it does not take timely steps to modify its present distribution system in the wake of fast growing demand

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LIMITATIONS/SUGGESTIONS/ RECOMMENDATIONS/CONCL USIONS

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LIMITATIONS OF STUDY
The duration of practical training was just of four weeks. It was not sufficient. Due to heavy engagement of the top management people and other personnel, many other information could not be collected within the limited span of time. To maintain secrecy, the company people do not provide various types of information, such as actual sales to various customers, zonewise sales, depot setup cost, depot handling cost etc. Their recommendations are the outcome of an analysis made individually. Another analysis may arrive at certain other recommendations after using same data. So, that it is advisable for the company to examine the various recommendations, before going ahead with any of their implementations.

SUGGESTIONS/RECOMMENDATIONS/CONC LUSIONS
Certain recommendations with regard to distribution channel of HIL are as under: (A) Northern zone offers the most lucrative sales in last financial year.. In the light of such high sales driven by the factors such as
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heavy investments in infrastructures and related industries machinery, transportation etc. In this zone our more than 65% sales depends on indirect sales. So that our focus should convert indirect sales to direct sales. Our effort should be here increase the depots in proportionate way, and also made appointment TMs and RMs. (B) Southern zone is also the fast growing market for the company. The zone offers bright prospects to company in terms of future demand driven by rapid industrial expansion. In this zone our more than 60% sales depends on direct sales and also we face cutthroat competition. In maintain the sales need of continuous market research in regard to distribution channel & appoint stockiest instead of consignment agents. (C) Western zone is the key market of the company. This zone is the most advanced zone in industrialization in the country. In this zone our 65%(Approx.) sales is through direct sales. Analysis of sales data, present depots, stockiests & consignment agents, 35% of the sales in this zone is indirectly depending upon consignment agents & stockiest. The demand of this zone is very high. To optimize in this key zone, the company should established additional depots in that areas- Ahmedabad & Nagpur for enhancing direct sales.
(D) In

eastern zone companys, indirect sales is approx. 70%. Such a heavy indirect sales reflects that the company is not in direct contact of its customers and their worries and feedback and these are most essential factors for improving level of sales. In direct sales is not helpful to create, grow & retain the customers. So making the sales customer oriented and to improve the sales, the company can take the following initiatives106

1. Assign sales representatives to contact all prospects in this area. 2. Design a sale promotion complain focusing on brand awareness. 3. Appoint a regular sales representative with each stockiest. 4. Shift to retail format of business by owning aluminium galleries in malls.

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BIBLIOGRAPHY

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BIBLIOGRAPHY
BOOKS
PRINCIPLES OF MARKETING, KOTLER & ARMSTRONG. RESEARCH METHODOLOGY, C.K. KOTHARI & NARESH K. MALHOTRA

MAGAZINE
INCAL 98 ALtrack

WEBSITES

WWW.ADITYABIRLA.COM WWW.ALUMINIUM-INDIA.COM WWW.ALUMINIUMMLEADER.COM WWW.ALUMINIUM-MESSE.COM WWW.WIKIPENDIA.COM

OTHER SOURCES
ANNUAL REPORT (07-08), HIL INDUCTION GUIDE , (TRAINING CENTRE )

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