INDUSTRY is playing a major role in the contribution

 INDUSTRY PROFILE

The Chemical Industry
are those industries which are engaged in production of chemicals. The main
activity of this industry is that it transforms materials such as natural gas,
oil, water, minerals, air and metals into semi-finished & finished products.
Although utilization of chemicals was made from the past but the concept of
heavy chemicals industry came into being in the pre-industrial revolution
period.

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The
Chemical Industry is considered as the fastest developing industries in the
economy. The chemicals that are produced in India may compose either those
products which are mainly related to manufacturing applications i.e. in
textiles, plastics, pharmaceuticals, fertilizers, paints and other products are
those which are used as raw materials by other industries.

The
chemical industrial products can be categorized into 3 categories:

·      
 Basic Chemicals

·      
 Special purpose Chemicals

·      
 Final Consumption Chemicals

Basic
chemicals refers to those chemicals that are produced in large quantities and
act as raw materials to other industries for the purpose of final product
before it reaches to consumer. Specialty purpose chemicals consist of variety
of chemicals that are used for crop protection, inks and paints. Consumer
chemicals are those which results in final consumption. They include for
example soaps and other detergents. Apart from these, they are also involved in
production of chemicals that is used for cosmetics and fragrances.

Indian
Chemical Industry is playing a major role in the contribution of GDP of Indian
Economy. The Indian chemical sector gives a greater contribution heavily to the
foreign trade of the country. Chemicals contribute 5.4% to the India’s total
export. The major sub segments such as dyes, pharmaceuticals and agro products
play a major role in export market. Dyes are mainly exported to countries like
Germany, UK. Japan, Spain etc. According to reports India occupies at the 12th
position in the entire world while is the 3rd largest in producing
output in entire Asia. The consumption of per capita on the products of this
industry in India is held at 1/10th of the world average which gives
a clear picture of growth in this particular sector.

The production of Chlor-alkali requires high amount of
energy, which contributes electricity costs that results in 40–50% of operating
production costs. Electricity consumption depends on different technology used
in chlor-alkali production. Around 74% of global chlor-alkali

capacity uses membrane cell technology in 2014. Diaphragm
cell and other technology account for 17% and 4%, respectively. About 4% of
global chlor-alkali capacity still uses mercury cell, but this is expected to
decrease substantially in the near future chlorine and caustic are two of the most important commodity inorganic
chemicals. Other two important and related alkalis are sodium carbonate,
commonly known as soda ash, and potassium hydroxide, are called caustic potash. Chlorine and
caustic soda together are jointly known as chlor-alkali; this describes the
properties of chlorine and caustic potash.

 

1.2Growth opportunities:

There will be growth of 8-9%
in the Indian Chemical Industry in the upcoming years & also hike in the
shares in global chemical industry to 5-6% by 2021. Some initiatives & keys
factors need to be taken care of for the growth of chemical industry i.e.
current demand, Product Mix, rival competitors etc. Companies should adopt such
a strategy that results in reduction in the cost of electricity & water
which are necessary to carry out their day to day activities. Companies can
adopt merger policies so that they can expand their business in different
segments, gain market share and reach the global market. There is a huge demand
for specialist chemicals in the domestic market so company can work for them.

 

1.3 Government Policies & Regulations

Government considers
Chemical Industry as a key factor element for the growth of chemical
Industry.100 percent FDI is permitted is allowed in Chemical Sector. Most of
the manufacturing firms of this sector have been deprived from holiday license
because they are hazardous in nature. But some companies need to be compulsory
licensed carrying out business with items like Hydrocyanic acid &
derivatives, Isocyanides & di-isocyanides of hydrocarbons.

 The following are the initiatives that have
been proposed in the 5 year plan (2012-2017) to increase the growth of chemical
sector:                                                            

 

 

Investment Policies:

·      
Investment is major
activity which is required for the growth of chemical industry. Government aim
to increase share of this industry in GDP from 16% to 25%.

·      
Technology up gradation
fund of $80 million is also proposed.

 

Other Policies:

·      
Loan facility to those
firms which carry out nature friendly activities.

·      
Encouraging companies
by reducing the taxes on import duties like coal, furnace oil etc.

 

2.1. Background of the
company

Grasim
Industries Limited, owned by the Aditya Birla Group was incorporated on August
25, 1947.It is one of the top among the private sector companies. It began its
operations as textiles manufacturer in 1948, today Grasim’s business consist of
Viscose staple fibber (VSF), Cement (majorly Caustic Soda), chemicals and
textiles. Grasim industries are top players in VSF and Cement business, which
result to higher revenues and operating profit i.e. over 90%.

                     

Grasim
Industries Ltd after its merger is one of important segment Aditya Birla Group,
is ranked among India’s largest private sector companies. For FY 2017, it
resulted the net revenue of Rs of Rs 328 billion (US$6.0 Bn.) and  net profit of Rs 32 billion (US$472 Mn.) in
FY 2017.

 

 The Aditya Birla Group is the fellowship of
Fortune 500, ranked by the special force which consists of 120,000 employees,
which belong to 42 countries. Over 50 percent of its revenue are achieved by
operations from overseas which consist of 36 countries. The group’s has
undertaken its businesses across a swatch of industries. These include
aluminum, copper, cement, textile (pulp, fiber, fabric and branded apparel,
yarn), and financial services. Carbon black, natural resources, retail and
trading, telecommunications.

 

The
company entered into Chemicals business, to manufacture Caustic Soda, an input
for VSF. The Business has grownmulti-fold and today Grasim is major producer of
Caustic soda  in India. It also produces
a range of Chlorine Derivates products and Epoxy.

 

After
the merger with ABCIL in FY 2016, it resulted in caustic soda capacity was
increased from 452K TPA to 840K TPA. The merger will enable the geographical
diversification for Grasim through the addition of ABCIL’s manufacturing
facilities spread across the country. The growth opportunities have been
emerged by combining operational and financial strategies of both the
industries, which will come up with new research techniques and expand  its business Globally.

 

The
chlor-alkai and phosphoric division of Solaris Chemtech Industries limited,
Karwar was acquired by ABCIL which was set up in Karwar, Karnataka. Another
unit by name Karwar Chemical Division, which gives brand image to the company
in that region, which results growth opportunities in the caustic business
along with lead the business of phosphoric acid.

 

2.2 Promoters of
Grasim Industries:

The
following are the promoters of GIL:

1.    
P.T. Indo Bharat Rayon

2.    
Turquoise Investment And Finance Private Limited

3.    
Kumar Mangalam Birla

4.    
Aditya Vikram Kumarmangalam Birla Huf 

5.    
Trapti Trading And Investments Private Limited

6.    
P T Sunrise Bumi Textiles

7.    
P T Elegant Textile Industry

8.    
Pilani Investment and Industries Corporation Ltd.

9.    
Rajashree Birla

10. 
Vasavadatta Bajaj

 

 

 

 

2.3 Nature of
Business:

Every
business has been established with a purpose. Some company’s aims at effective
utilization of available resources provide better services to its customers and
some aim to expand its business. Grasim Industries mainly operates in chemical
production business. Its aim is provide quality products and have a brand image
in the market. It follows the process of Acquisition and mergers so that it can
expand its business and explore globally and have the market share in global
market.

 

2.4 Vision, Mission
and Values:

Vision

To be a premium global
conglomerate with a clear focus on each other.

Mission

To deliver superior
value to our customers, Shareholders, employees and Society at large.

Values

Integrity

Commitment

Passion

Seamlessness

Speed

 

Quality
policy

Grasim Industries
Limited, Karwar division, the manufacturer and supplier of bulk-chemicals i.e
Caustic Soda, Liquid Chlorine, Hydrochloric Acid and Phosphoric Acid product is
committed to continually improve the customer satisfaction levels in its target
market statements. Environment protection in all its activity and ensuring a
safe and healthy working environment at unit karwar, by supply of quality
products, that meet or exceed customer relationship management, complying with
applicable environment and OH &S regulation, establishing implementing and
maintaining, QMS, EMS and OH&S systems in line with ISO-9001:2008, ISO
14001:2004 and BS OHSAS 18 001:2007 standard, continue planning and
involvements in process and open communication with all stakeholders on  progress and performance in quality,
environment, OH&S management, continual improvement of the documented
system by regular review and monitoring of process, and taking appropriate
corrective action through training personnel.

2.5
Achievements & Awards:

Grasim
industries have won above 70 awards in various streams for which describe the
excellence of that industry.

·      
Ranked at 1380 position
in Forbes Magazine.

·      
It has been ranked
among the Fabulous 50 companies throughout Asia.

·      
Ranked at second position
by IR Global Rankings for Best Corporate Governance.

 

2.6
Product and Service Profile

GIL is mainly engaged
in production goods which are commonly used in most of the drag formation. The
following are the products:

1.    
Caustic
Soda

GIL produces high
quality Caustic soda and flakes using the latest membrane technology.
Production 140-150 MTT/day and is transported in tankers.

Industrial Application:

·       Chemical Processing

Caustic
soda is commonly used in regent in chemicals reactions.

·       Home and Personal Care

      Caustic soda is used in the saponification
reaction to manufacture soap.

·       Aluminum

       The purified alumina is then used to
produce aluminium.

 

·      
Petroleum
Prosecutes

Caustic Soda solution
is used in the exploration, production and processing of petroleum and natural
gas.

2.    
Hydrochloric
acid

Production of  Hydrochloric acid is done mainly for food
components and other  is for daily use,
production 300 MT/ 1 day and is transported in tankers,

Industrial
Applications:

·      
Production of paints,
mixed in dyes.

·      
This acid is used to
produce variety of dyes and pigments.

·      
Food

Hydrochloric acid is
utilized in the making of high fructose corn syrup (HFCS). This chemical can be
found in soft drinks, used also utilized in processing of food items in.
Outcomes of this acid is citric acid and artificial sweeteners.

·      
Steel

The uses of
hydrochloric acid are the picking of carbon and stainless steels. It is aused
Etching of  aluminum, and cleaning of
metal.

 

3.    
Phosphoric
Acid

GIL produces phosphoric
acid that goes into food applications. 75-80 MT/ Day packed and transported
into tankers and carbonyls.

Industrial applications

·      
Home & personal
Care

The production of
perfumes is one of the main users of phosphoric acid in the home and personal
care industry.

·      
Food

Food grade phosphoric
acid is used as an acidulant and flavoring agent in the carbonated beverage
industry. It is used as a degumming agent while refining vegetable oil and
sugar. It also acts as an acidulant for baking powders and emulsifying salts in
the production of processed cheese.

 

4.    
Chlorine

GIL produces huge
quantity of chlorine which is packed in tonners and transported to its end
customers. 30-35 MT/day packed and transported in Tonners of .9 MT.

Its Applications:

·      
Agriculture

This liquid is mostly
used in production of pesticides and insecticides.

·      
Paper
& pulp

Liquid chlorine helps
for whitening of pulp.

·      
Water
purification

Chlorine is mostly used
for purification of water and it avoids the biological growth. Liquid chlorine
also acts as a controller of hydrogen sulphide.

 

·      
Plastics

Chlorination of
ethylene produces PVC.Polyurethanes which is outcome of Tolene Disocyanate(TDI)
and Methylene Diphenyldisocynate(MDI are all produced from Liquid Chlorine.

         

 Infrastructural Facilities

The location of the
industry is such that it is easily approachable by sea and road, On one side of
the factory are the Western Ghats at National Highway 17 runs in front of the
factory which is adjacent to Arabian Sea thus making this place the most
suitable one for establishing this factory as it is necessary for the
transportation of finished goods and also for the supply of raw materials to
the factory.

Residential
Quarters

The company is
providing residential quarters for its employees without deducting HRA from
employee’s salary.

Bus
Facility

The employees staying
in quarters can avail the bus facility provided by the company. It’s very
useful for the students who pursue their studies outside the Company’s Campus.

Canteen
Facilities

The company provides
canteen facility to its employees wherein tea, snacks and meals are provided.
Employees can avail this facility can taking monthly coupons which are provided
at subsidized rate.

Rest
Room

The company provides
rest room facility wherein the workers can take rest and also interact with
their co-workers.

Drinking
Water Facility

Water is very essential
for human beings; with this intention company provides cool & purified
drinking water to its employees. Water coolers are installed in every department
and many taps are installed around the plant.

 

First
Aid

First Aid room is
installed in the campus so that necessary actions can be taken in times of
emergency. Even Ambulance facility is provided.

Other
Facilities

                
i.         
The school called Bal
Bhavan for the employee’s children was established in 1987, the syllabus is
according to the State Government in English.

              
ii.         
Safety equipments like
gumboots, gloves, helmets, masks are provided by the company for personal
safety purpose.

            
iii.         
Guest room is available
so that outsides can take rest and wait there till their work is done with
higher officials.

2.7Area
of Operation

Grasim Industries
Limited  (formerly Aditya Birla Chemicals
India Limited), Karwar unit is having its business spread over India. The
Karwar one operates in the following companies.

Ø  West
Cost Paper Mills Dandeli

Ø  Tanvir
Bavi Power Company Private Ltd-Mangalore

Ø  Mangalore
Refinery Petro-chem. ltd. Mangalore

Ø  Indian
Aluminum Company-Belgaum

Grasim Industries aims
to enter global markets by providing the quality products and by capturing
domestic Market.

2.8
Future Growth & Prospects

The future of the Chlor-Alkai
industry is bright, provided the company must adopt the latest technology and
become more energy efficient. The units, which are running on outdated
technology, will cease to exist, only units which are cost conscious, will be
able to survive. Today Grasim Industries in India is the finest manufacturer
and exporter of technical grade phosphoric acid and a dominant player in the
manufacturer of caustic soda, chlorine. The chemical industry, in India has
immense potential and growth as the per capita consumption is well below world
average.