Industry Profile–Growth–Public Sector Indian Fertilizer Industries–Private Sector Fertilizers
Companies–Company Profile–Organizational Structure–Groups–Mission–Standards–Values–
1.1.1 INDUSTRY PROFILE
India is basically an agricultural country which economy depends largely upon its agrarian
produce. Agricultural sphere contributes about 25% to the country‟s GDP. Indian fertilizer
industry has a tremendous scope in and outside the country as it is one of the allied parts of
Today, Indian fertilizer industry is developing in terms of technology. Indian manufacturers are
adopting advanced manufacturing process to prepare innovative new products for Indian
agriculture. India has entitled as the third largest producer and exporter on nitrogenous fertilizer.
Growth of Fertilizer Industry in India
Fertilizer industry in India is meeting all the requirements of agricultural industry since the sale
of its inception in 1906. The plant for fertilizers manufactures was set up in the same year in
Ranipet Chennai. Then established the first two large-sized fertilizer plants one was the fertilizer
and chemicals Travancore of India Ltd. (FACT) in Cochin, Kerala and the one was Fertilizer
Corporation of India (FCI) in Sindri, Bihar.
These two were established as pedestal fertilizers units to have self stuffiness in the production
of food grains. Afterwards the industry gained impetus in its growth due to green revolution in
late sixties followed by seventies and eighties when fertilizer industry witnessed an incredible
boom in the production. The tremendous demand of fertilizers had led the country to invest huge
in the public, corporative and in private sectors.
At present India has more than 57 large sized plants on fertilizers, manufacturing wide
assortment of fertilizers including nitrogenous, phosphate, Ammonium Sulphate (AS), Calcium
Ammonium Nitrate (CAN) urea, DAP and complex fertilizers. Apart from it, there are other 64
small and medium scale Indian manufacturers producing fertilizers.
Here is the list of some public sector Indian fertilizer industries
Madras Fertilizers Limited
National Fertilizers Limited
Hindustan Fertilizers Corporation Limited
Steel Authority Of India Limited
Fertilizers & Chemicals Travancore Limited
Rashtriya Chemicals & Fertilizers Limited
Pradeep Phosphates Limited
Pyrits Phosphates & Chemicals Limited
Neyveli Lignite Corporation Limited
Some of the major private sector fertilizers companies in India
Balaji Fertilizers Private Limited
Ajay Farm-Chem Private Limited
Bharat Fertilizers Industries Limited
Gujarat Narmada Valley Fertilizers Co Limited
Godavari Valley Fertilizer & Chemicals Limited
Gujarat State Fertilizers & Chemicals Limited
Maharashtra Agro Industrial Development Corporation
The speedy growth in the fertilizers production is swaying the Indian manufacturers to transform
into Indian exporters and helping them to create a long lasting impression on global consumers.
1.1.2 COMPANY PROFILE
Madras fertilizers limited (MFL) incorporated in the year 1966 is a PSU under the administrative
control of the department of fertilizer (DOF), Ministry of chemicals and fertilizers, government
MFL is engaged in the manufacture of Ammonia, Urea and Complex fertilizers (N:P & N:P:K)
at Manali, Chennai. MFL is also engaged in manufacturing Bio-fertilizers and eco friendly Agro
chemicals under the brand name ‟Vijay‟.
MFL is a public sector undertaking, under administrative control of the department of fertilizers,
ministry of chemical & fertilizers. MFL has been serving the nation for the past 44 years since
plant commissioning in 1971 and is proud to be part of green revolution.
The Company Committed To,
a. Meet needs of the farmers
b. Production & promotion of balanced NPK fertilizers
c. Production & promotion of new generation bio-fertilizers
d. Marketing of eco-friendly neem pesticides
e. Protection of environment & energy conservation
f. Continual up gradation of technology and development of human resource
MFL was incorporated on December 8, 1966 as a joint venture between GOI and AMOCO India
incorporated of U.S.A (AMOCO) in accordance with the fertilizer formation agreement executed
on 14-5-1966 with equity contributions of 51% and 49% respectively.
In accordance with the participation agreement between GOI, AMOCO and National Iranian
Company (NIOC), an undertaking of Government of Iran, NIOC acquired 50% of the share
holding of AMOCO in MFL on 22-11-1972. With this acquisition, share holding of AMOCO
and NIOC were at 24.5% each, with the balance 51% being held by GOI. Subsequently, on
22-7-1985 the shareholding of AMOCO was proportionately purchased by GOI and NIOC.
As a result, GOI and NIOC shareholding was revised to 67.55% and 32.45% respectively.
Subsequent to the issue of rights, shares in 1994 for part-financing the project, the holding of
GOI and NIOC stood at 69.78% and 30.22% respectively. MFL had an initial public offering of
its shares in May 1997. After the allotment of shares to the public the shareholding pattern as
Table:1.1 showing the share holding pattern
No Of Shares (Mill)
MFL is engaged in the manufacture of Ammonia, Urea, Complex fertilizers and Bio-fertilizers.
MFL‟s activities include marketing of these fertilizers and trading in agro chemicals in
accordance with the corporate objective. MFL has been striving to develop and maintain an
organizational environment that motivates the individual, encourages personal initiative,
innovative and creativity.
1.1.3 ORGANIZATIONAL STRUCTURE
THE BOARD OF DIRECTORS
Dr. I. VIJAYAKUMAR, IRS
Chairman & Managing Director
Madras Fertilizers Limited
Manali, Chennai - 600068
Shri V K Subburaj, IAS
And Financial Advisor
Department of Fertilizers
Ministry of Chemicals & Fertilizers
Government of India
New Delhi - 110 001
Shri Satish Chandra, IAS
Joint Secretary (P&A)
Department of Fertilizers
Ministry of Chemicals & Fertilizers
Government of India
New Delhi - 110 001
Mr. M Sagar Mathews
Director - Technical
Madras Fertilizers Limited
Manali, Chennai - 600068
Mr. M H Ghodsi
Naftiran Intertrade Co.Ltd.
Mr. Mohammad Ali Ahmadi
Naftiran Intertrade Co.Ltd.
Mr. Ahmad Azmoodeh
Naftiran Intertrade Co.Ltd.
1. Operation / Production
2. Technical Engineering Services
3. Marketing & Distribution
4. Finance & Accounts
6. Corporate Services
7. Personal & Administration
8. Executive Director (vigilance)
1.1.5 MFL MISSION
Our mission is to achieve all round excellence in the spheres of manufacture and marketing of
chemical fertilizers, Bio-fertilizers, and Agrochemicals paving way for increased agricultural
production and productivity, maximizing shareholders value and guarding interest of all stakeholders of the company.
1.1.6 MFL STANDARDS
We have set upon ourselves the standards for all transactions with you. We undertake that in case
of likely or inevitable delay, we shall promptly communicate the same to the party concerned.
We shall carry out our functions and duty with utmost
Without any fear or favor.
We expect you to be reasonable and prompt in exercising your rights and obligations in all your
transactions with the company without extending inducement of any kind and not raising any
1.1.7 MFL COMMITMENTS
They commit to
Produce and distribute quality fertilizers conforming to the specifications.
Timely distribution of our fertilizers to ensure consumer satisfaction.
Continual up gradation of technology and development of human resources.
Strict adherence to the prescribed safety, health and environmental protection standards.
All officers who deal with the public will carry an Identity card.
Provide every possible assistance to public by the Public Relations officers in the
Registered Office, and by Regional Managers in our Regional Offices and Chief Resident
Manager, New Delhi. The officers nominated would, besides, provide relevant
information including procedures that may have to be followed by public in dealing with
Keep the Personal and Business information disclosed to us confidential.
2.1 PRODUCTION DEPARTMENT
Plant– Product Profile–Chemical Fertilizers–Vijay Urea–Vijay Complexes (NPK)–Production,
Imports, Consumption of Major Fertilizers– Bio-fertilizers –Forestry–Agro Chemicals –Neem
Based– Plant Performance–Gas Conversion–Revamp–Post–Revamp–Process–Quality Policy–
2.1.1 THE PLANT
MFL consists of production plants, Ammonia, Urea in single streams and NPK in three streams,
viz. NPK A Train, B Train and C Train. Utilities Plant is the service plant supplying treated
water, cooling water, off-site steam, instrument air, captive power and emergency power. On
November 1, 1971, MFL commenced commercial production of Ammonia, Urea and NPK
complex. The feedstock for Ammonia is Naphtha and it is being supplied by the neighboring
M/s Chennai Petroleum Corporation Limited (CPCL)
The original Ammonia / Urea Plants were of Chemico design with the daily rated capacity of
750 MT (2,47,500 MTPA) and 885 MT (2,92,000 MTPA) respectively. Initially there were only
two trains to produce granulated complex fertilizers with a total installed capacity of
3,60,000 MTPA and in September 1976 one more NPK stream, namely C Train, was added
raising the installed capacity to 5,40,000 MTPA, all by Hindustan Dorr Oliver.
In 1991, the old Chemico converter of Ammonia Plant was replaced with the latest S 200 Radial
2.1.2 PRODUCT DETAILS
NPK (complex fertilizer) 17-17-17 is the prime product of MFL, which accounts for 90% of
MFL‟s total, production for sale. The brand name given to these products is VIJAY.
NPK - Complex (17:17:17)
VIJAY Urea with 46% Nitrogen is an economical Nitrogenous fertilizer suitable for all crops and all
soil types. It can be used separately as a top dressing fertilizer or in combination with other fertilizers
also. It is suitable for foliar application also.
VIJAY Complexes (NPK)
VIJAY complexes are granulated fertilizers containing Nitrogen, Phosphorous and Potash. As the
nutrients are present in balanced proportion, they are ideal for application as basal fertilizers to all the
VIJAY 17:17:17, which was introduced in 1970, is our flagship product, which enjoys high farmer
preference, on account of its excellent performance leading to bumper yields. It was the first balanced
complex fertilizer to be introduced in Indian market, with all the three nutrients available in equal
proportion. The nitrogen in VIJAY 17:17:17 is in Amide and Ammonia forms, making it ideally suited
for early growth and vegetative phases of all crops.
2.1.3 PRODUCTION, IMPORTS, CONSUMPTION OF MAJOR FERTILIZERS
The figures of production, imports and consumption of major fertilizers viz, Urea and NPK complexes
in India for the years 2010-11 and 2011-12 are given below:
Table:2.1 Production, Imports, Consumption
Table:2.2 MFL Production of Urea /NP/NPK Fertilizers
(Lakhs Million Tones)
Table:2.3 Production of Vijay Bio Fertilizers
Table:2.4 All India Product-Wise Demand Forecast For 2012-13 to 2015-16
Azospirillum (Other crops)
Azospirillum (Plantation Crops)
Phospho Bacteria (All Crops)
A healthy soil alone can utilize the applied chemical fertilizers efficiently and lead to high yields. The
health of the soil is maintained by various factors, the most important being the
soil microbes. Continuous cultivation results in microbial population being depleted. Inoculation of
Bio-fertilizers in cultivated soil results in multiplication of the microbial population. MFL, with a
view to maintain good health and fertility of the soil, introduced Bio-fertilizers under the brand name
VIJAY Bio-fertilizers come in two categories, viz., Nitrogen fixers and Phosphate Solublizers. The
Bio-fertilizer range is wide and covers the requirements of all crops under all soil / climatic conditions.
VIJAY Bio-fertilizers play a crucial role in restoring the forest cover of India, as Forest Departments
of State Governments regularly use VIJAY Bio-fertilizers during raising of nurseries of forest
trees. These saplings are subsequently planted on large scale in degraded areas to restore forest cover.
Agro Chemicals - Neem based
VIJAY Neem - 300 ppm
VIJAY Neem - 1500 ppm
MFL markets Neem based Pesticides, under the brand name VIJAY NEEM. Of late, biological and
botanical pesticides have gained importance, as they are environment friendly and highly effective
with negligible residual content in agricultural produce. Neem based products occupy an important
place in botanical pesticides. VIJAY Neem is based on neem kernel extract and has a wide spectrum
of activity against major pests, which infest both commercial and food crops.
VIJAY NEEM is presented in 300 ppm and 1500 ppm, in packing‟s of 100 ml to 20 litres, to suit the
needs of all categories of farmers.
VIJAY NEEM can be used as a 'Stand Alone' pesticide. The unique feature of VIJAY NEEM is that
pests do not develop resistance to it. This enables farmers to repeatedly use the product with the same
effectiveness for a long period of time.
2.1.4 PLANT PERFORMANCE
The Company produced 4,86,750 MT of Urea as of March 4, 2012 which is 100% of installed
Capacity. The previous record was 4,78,834 MT (98.4% cap) during the year 2010 -11. After a gap of
about four years, production of Complex fertilizers could be started initially with NPKS 20-20-0-13
and thereafter could switch over to the Company‟s flagship product of NPK 17-17-17.
NPK „C‟ Train was restarted after extensive refurbishment on February12, 2012. Thus, now two of
three NPK Trains are available for production. Specific energy consumption of 10.369 Gcal/MT
Ammonia and 7.517 Gcal/MT Urea achieved during the year 2011-12 are the second best
achievements since inception.
2.1.5 GAS CONVERSION
In order to comply with the directives of GOI, company has already initiated action for feedstock
conversion from Naphtha to Natural Gas. The Basic Engineering & Design Package (BEDP) has been
received and detailed engineering is in progress. The company‟s request for allocation of
1.54 MMSCMD of Natural Gas has been forwarded by Department of Fertilizers vide their letter
NO.12012/24/2006-FFP dated 11.06.2010 to Ministry of Petroleum & Natural Gas.
The company, to extend the economic life of the plants by another 15 years and also envisaging
improvement in energy consumption, undertook a major Revamp-cum-Modernization and Capacity
Enhancement of its plants at a cost of Rs 600 Cr during 1993-1998. Production from the Revamped
Plants commenced from March 3, 1998.
Process License and Basic Engineering from M/s Haldor Topsoe, Denmark for Ammonia Plant and
from M/s Urea Technologies Inc., U.S.A for Urea Plant was adopted with modern Distributed Control
System (DCS). The enhanced production capacities are 1,050 MTPD for Ammonia (3,46,500 MTPA)
and 1,475 MTPD for Urea (4,86,750 MTPD). With respect to NPK, Pipe-reactor with Process License
& Basic Engineering from M/s Grande Parroise, France was incorporated in NPK B Train. By this and
along with higher on-stream efficiency, the installed capacity was raised to 2,550 MTPD
After overcoming initial teething troubles, the Ammonia & Urea Plants reached 87% and 83%
capacity utilization levels in 1999-2000. To improve product quality and bring down product
temperature before admitting into bagging streams, Prill Tower modification was carried out by
Monsanto Enviro-Chem (MECSI), U.S.A. and a fluidized bed cooler Prills Cooling System (PCS)
was put into service.
Urea Plant achieved a record production of 4,86,750 MT in 2011-12 surpassing the previous best of
4,78,834 MT in 2010-11. Specific consumption of feedstock has also come down over the years
after process stabilization.
Ammonia, a chemical compound of nitrogen and hydrogen is produced using naphtha, steam and
air. Feedstock naphtha is the source for hydrogen and atmospheric air for nitrogen.
Naphtha is de-sulphurised in two stages and the hydrocarbon is reformed together with steam and
air to raw synthesis gas in the reforming section. The reforming section consists of Pre-reformer,
Primary Reformer and Secondary Reformer. Air is introduced in the Secondary Reformer.
Reformed gas containing H2, N2, CO and CO2 and minor amount of unreformed methane (CH4) is
sent to the CO conversion section where CO is converted into CO2 in two steps in shift conversion
CO2 is absorbed using Methyl Di-ethanol Amine (MDEA) in the CO2 removal section and sent to
Urea Plant as one of the raw materials for Urea production. The remaining CO and CO2 from the
process gas are converted to CH4 in the Methanator. The processed synthesis gas is compressed
and sent to the catalytic converters (S 200 and S 50) where Ammonia is produced by the catalytic
action. Synthesized Ammonia is separated and sent to Urea Plant as raw material and the
remaining quantity is refrigerated and sent to cylindrical storage tanks.
Urea is produced by reacting Ammonia with Carbon-di-oxide (obtained from Ammonia Plant) in
stainless steel lined reactors at 215-220 kg/cm2g pressure, using the technology of UTI‟s Total
Heat Recycle Process. The high efficiency Reactor has a conversion of CO2 to Urea of about 76%
After flashing and decomposition at medium pressure, an additional Carbon-di-oxide is injected
into the Medium Pressure System followed by flashing and decomposition at low pressure and
then concentration of urea solution at vacuum. Further concentration takes place at evaporators at
the top of Prill Tower.
Here the hot Urea solution sprayed down in a 210” cylindrical concrete Prill Tower, counter
current to a stream of cold air with a free fall height of prills for 170”. The Urea solidifies into
small white Urea prills. The prills are then passed through a Fluidized Bed Cooler
(Prills Cooling System) to reduce temperature and fines thereby improving the quality of the
The entire off gas is absorbed in a bubble cap tray absorber and then recycled to the reactors. The
chloride-free effluent is treated in a Hydrolyser Stripper and the contents are recycled fully. The
treated water is used for demister washing.
The product is sent through a system of conveyors and elevators to bagging streams. There it is
bagged and shipped as Urea product.
There are 3 NPK trains that are identical except that in one we use the TVA Granulator while
others have Blunger units in the fertilizer granulation section. The basic steps for NPK
Reaction of liquid Ammonia and Phosphoric Acid to form slurry of mono
and di ammonium phosphates in Pre-neutralizer in two trains (A & C Trains). In the other train
(B Train) reaction is carried out in pipe cross reactor installed inside the granulator and dryer.
Mixing of the slurry with other feed materials: Liquid Ammonia, Urea, Muriate of
Potash, Filler and re cycled NPK granules. Solid raw materials are fed to the system through the
modern J&N Weigh Feeders (with Programmable Logic Control device) which maintain
accuracy according the set load. Mixing is done in the Granulator or Blunger units where the
fertilizer granules are formed.
Drying of the granulated material in a rotary dryer.
Separation of granule produced by screening followed by cooling, coating &
polishing of the granules and product bagging. MFL produces four grades of NPK fertilizers
viz. 17-17-17, 19-19-19, 20-20-0 and DAP 18-46-0.
One set three bagging streams for bagging Urea and another set of four streams for bagging
products from NPK A and B Trains are provided in Bagging and Shipping Plant. A separate set
of three bagging streams are available for bagging the complex fertilizer from NPK C Train.
The bagging streams are maintained in humidity free atmosphere by dry Air System since NPK
complex fertilizer is hygroscopic in nature.
The Bagging System consists of a high precision machine (Jashubhai Richard Simon Ltd,
Mumbai) with an accuracy of + or - 10gms from the set 50 kg per bag of fertilizer and an auto
The bagged product is moved in conveyors for loading trucks or wagons to transport to various
warehouses / dealers.
2.1.7 QUALITY POLICY UNDER ISO 9002
Commitment to manufacture quality fertilizers conforming to specification using
standard new material.
Timely distribution of products ensuring consumer satisfaction.
Continual up gradation of technology, Development of Human resource and
Improvement of Quality of Work life.
Strict adherence to national safety standards and environment friendly norms.
2.1.8 SWOT ANALYSIS
Technical competence of the organization
Fully committed and motivated employees
High inter-group and inter department co-ordination
Good knowledge of South India market with respect to agriculture Inputs
Stringent Government policies
Availability of limited range of products
Strict adherence to the policies and procedures
Free market economy where public sector has to compete with private sector
Agricultural to be more open market oriented
Easier access to world‟s best technology
Higher focus on Productivity and efficiency in agriculture
Strategic alliance for marketing
Overrun carrying cost
Switching over from seller market to buyer market
Delay in Government‟s efforts to bail out loss making
Public Sector Undertaking
3.1 HUMAN RESOURCE DEPARTMENT
Overview– Recruitment– Training And Development– Performance Appraisal– Designation /
Grade System– Man Power– Pay Scale–Personnel Department & Its Functions–Office Time–
Personal Protective Equipment
This department is mainly responsible for the recruitment, selection, training, development,
promotion, etc, all that is related to the employees. The department maintains all the details
regarding its employees for their reference in future and as and whenever required.
The recruitment process started with Identification of vacancies to be filled up its is
basically concerned with the identification of sources from where the personnel can be
employed and motivating them to offer for the employment. As MFL is a GOI undertaking
organization, it gives more importance in selection process of employees. By conducting
Technical and non technical entrance exams and follow up of the next stages of interview itself
selection process carried out in MFL.
Recommendations of job are completely avoided and
pure performance, knowledge and experience based employees are appointed here in MFL.
It is process of searching for prospective employees, stimulation and encouraging
them to apply for job in an organization.
3.1.2 TRAINING AND DEVELOPMENT
Training in MFL is provided for trainers of both technical and non technical candidates. Efficient
training is given to the trainers, so as to filter quality employees from them. Promotional based
top management training also given to the executives of MFL. Here new employees for
executives are rarely recruited, normally promotion based vacancy filling is followed.
3.1.3 PERFORMANCE APPRAISAL
While on the job, performance reviews of every employee are done every quarter. The reviews
are done with a view to helping the individual excel at his/her workplace. In case there are any
training requirements, these are noted and acted upon in the coming quarter. Also, the goals
and objectives for the employee are revised for the performance appraisal mechanism is
carried out at MFL for promotional purpose. These are done so as to motivate the employee
and improve his performance level.
a) Establishment of performance standards with the employees.
b) The goals are set mutually as per measurable standards.
c) The actual performance is hence measured.
d) After measuring of the actual performance, the same is compared with the
e) The appraisal is then discussed with the employee.
f) And finally, if need arises corrective
action is initiated. For this purpose the
corrective action is actually identified through brainstorming exercise initiated by the
department heads .It is then measured as a tool to evaluate the past performances of the
Maintenance of records regarding the attendance in-times and out-times of every worker and
staff. Attendance is being maintained by Bio-metric System for in and out timings. The machine
records the respective data and it is transferred to the computer. If any employee fails to swipe
his card details are entered into the records manually. Daily records of attendance, absenteeism
and late coming are maintained and salary administration is stored accordingly.
3.1.4 Personnel department & its Functions:
The personnel department covers mainly 3 areas.
o Human Resource Development (HRD)
o IR, Welfare & Legal
3.1.6 MAN POWER
Table: 3.1 Administrative Man power in MFL
Table :3.2 Technical Man power in MFL
3.1.6 PAY SCALE
Table: 3.3 Pay scale for Supervisors
Sr. Officer /
Deputy Manager /
Addl. Manager / Dy
Plant Manager /
Regional Manager /
DGM / JGM
C M D Schedule
The Management proposes to introduce a new scale at E-0 Level with a pay range of
Rs.12,600 - 32,500/-.
Table :3.4 Pay scale for Non-Supervisors
3.1.7 Personal Protective Equipment
Hand Shields, Gloves
Safety Shoes, Gum Boots
4.1 FINANCE DEPARTMENT
Dividend–Risk Management–Collection of Old Dues–Public Deposit–Corporate Performance–
Remuneration Committee–Audit Committee–Foreign Exchange Earnings and Outgo
The Company‟s operations for the year ended with a profit of Rs. 111.99 Cr (Previous Year
Rs.169.86 Cr). This is the highest ever operating profit made in any year since inception if
extraordinary items (OTS benefit) is not taken into account. This could be possible mainly
because of 100% capacity utilization of Urea achieved for the first time in the history of the
Company. The total accumulated loss as of 31.3.2012 was brought down to Rs. 505.20 Cr from
Table:4.1 Summary of Financial Results
Profit Before Interest, Depreciation,
DRE and Tax
Extraordinary items(OTS benefit)
Provision for Tax
4.1.1 RISK MANAGEMENT
Major challenges that fertilizer industry is facing are increasingly volatile International market
for fertilizers and raw materials, steep depreciation in rupee value, increasing prices of NPK
fertilizers due to new NBS policy and rise in the working capital requirements of fertilizer firms
in addition to the historical challenges associated with the rural markets. The Company has a
well laid down Risk Management System with Risk Assessment & Risk Mitigation procedures
to evolve suitable strategies for mitigating associated risks through better management practices
and achieve corporate objectives.
The identified potential risks such as Operational, Input, Utilities, Project Implementation,
Business, Competition, Assets, Internal Control, Environmental, Financial, Human Resources,
Legal, Regulatory, MIS and Market Risks and their impact on the Company‟s performance and
Stakeholders‟ interest is assessed on continual manner. The reporting of Risk Assessment and
Risk Mitigations under the policy is reviewed by the Audit Committee and the Board
Collection of Old Dues
An amount of Rs.37.10 lakhs has been collected from old dishonor cases and the Company is
taking all out efforts to optimize the collection.
4.1.2 PUBLIC DEPOSIT
The Company could not accept fresh deposits or renew the existing deposits during the year due
to statutory restrictions. The un claimed deposits as of March 31,2012 is Rs. 1.85Cr.
Despite earning profit during the year, Company could not pay Dividend to the shareholders due
to huge accumulated losses and negative net worth.
4.1.4 Remuneration Committee
Being a Central Public Sector Undertaking, the Managerial Remunerations for the executives
are fixed by the Government of India. Hence, the constitution of remuneration committee
does not arise.
4.1.5 Audit Committee
Five Audit Committee meetings were held during the financial year 2011-12 and the dates of
Audit Committee meetings are:
4.1.6 Foreign Exchange Earnings and Outgo 2011-12
1. Activities relating to export
2. Total Foreign Exchange used (` Cr)
a) Raw Materials
b) Components & Spare Parts
c) Books & Periodicals / Travel
3. Total Foreign Exchange earned
Table:4.3 Performance Evaluation Criteria and Targets: MoU 2012-13
5.1 MARKETING DEPARTMENT
Marketing Territories– Marketing Network– Regional Offices– Marketing Performance– Market
Development And Agro–Service Programs– Product Placement– Global Scenario– Logistics–
& Engineering Consultancy Services–Bio–Fertilizer
Consultancy–Future Plans–Achievements–Environmental Awards Won By MFL –Energy
Conservation Awards Won By MFL – Acts Governing The Company
5.1.1 Marketing Territories
MFL markets its Fertilizers, Bio-fertilizers and Agrochemicals, under the brand name VIJAY, in
the States of Tamilnadu, Andhra Pradesh, Karnataka, Kerala and the Union Territory of
Pondicherry. MFL also imports Di-Ammonium Phosphate and Muriate of Potash. As a result
of MFL‟s pioneering role in promoting use of complex fertilizers for balanced nutrient
application in South India during the past 34 years, MFL products enjoy a distinct preference
among farmers all over its marketing territory based on quality, compatibility with major crops
and soil and services to farmers.
5.1.2 Marketing Network
The field marketing activities are coordinated through a network of Regional Offices located in
11 strategic centers of the 5 Southern States, viz., Andhra Pradesh, Karnataka, Tamilnadu,
Kerala and Pondicherry. MFL has a team of well experienced, dedicated and professionally
qualified marketing officers, who market the VIJAY products thru well networked Dealers,
numbering around 6500, Co-operative Marketing Federations of respective States, Agro
Industries Corporations and other Institutions. Thus, MFL has well spread retail outlets
encompassing private, co-operatives and Agro Kendras for wider reach and better market
penetration of its products.
Table :5.1 Showing Regional Offices
Tamilnadu & Pondicherry
Door No. 18, I Floor
LIC Colony,Trichy 620 021
Anna Nagar (Upstairs)
Near Karthik Hospital
Madurai 625 020
11-5-338, Red Hills
Hyderabad 500 004
115/1, Lakshman Nagar,,
Salem 636 016.
29, 1st Floor
7th East Main Road
Vellore 632 006
Contact person Regional Manager
56-5-8, Ramineni Street,
Flat No S 3,
Vijayawada 520 008
Kadapa 516 003
No.66 (I Floor), "OMKAR" 1st Block,
3rd Cross 4th Main, Banashankari 3rd StageBangalore 560 085
Contact person Regional Manager
324/2, 1st Floor
2nd Main Road
P J Extension
Davanagere 577 004
Flat No. A2
Narayanan Asan Road,
Cochin 682 019
Nilaya,No 3, Word
No.25., 2nd Cross,
Bellary 583 101
5.1.3 MARKETING PERFORMANCE
During the year, company sold a total of 5.33 lakh MT of fertilizers compared to 4.74 lakh MT
last year, which is 12.5% increase. The market share of Urea got increased from 8% to 9% in
South India. Efforts for streamlining logistics operations continued this year also and 97% of the
products were directly delivered to the dealers. Cash sales accounted for 99.7% of total
sales.99.6% of the cheque realized within 7days. There has not been a single Bad Debt during
this year also.
Agrochemicals, Bio-fertilizers & Organic Manure
In this year Rs.181.10 lakhs environment friendly neem based Agrochemicals were traded during
the year as against Rs.142.01 lakhs during the last year, which is 27.5% higher. The Company
sold 481 MT of Bio-fertilizers during the year as against 453 MT during last year which is 6%
The Company also sold 3,630 MT of Organic Manure based on Poultry Waste during the year in
Tamil Nadu & Karnataka.
Market Development and Agro-service Programs
MFL's Marketing Personnel contacted 74,503 farmers during the year and educated them about
soil health techniques and usage of Bio-fertilizers/Neem products. As a service to farming
community, the Company collected 5,620 soil samples, analyzed and sent the nutrient
recommendations for various crops to farmers during the year.
The prices of major fertilizers such as Urea and Complex fertilizers like DAP, NPK and MoP
and fertilizer inputs such as Ammonia, Sulphur, Rock Phosphate and Phosphoric Acid increased
manifold which resulted in steep increase in prices of both indigenous as well as imported
5.1.4 Product Placement
The most critical aspect of Marketing and Distribution is making available to the farmers, Right
product at Right time and at Right place. Since fertilizer production is continuous and
consumption is seasonal, product movement, storage and delivery assume great significance. In
order to fulfill this onerous task, MFL has established a network of around 80 field warehouses
utilizing the services of Central/State Warehousing Corporations and Private Warehouses. MFL
also has the facility to deliver stocks from Plant gate to Farm gate, to ensure availability of fresh
products to the farmers.
The products are moved to these warehouses from MFL, both by Rail and Road. Movement
through point-to-point Jumbo Rakes is resorted to on a 'need' basis, for reaching the products to
distant locations at the shortest time. To facilitate immediate loading into wagons, MFL has its
own railway siding at the Plant site. Movement of fertilizers is meticulously planned in close
coordination with market requirements and production through the judicious mix of Road and
MFL Inspection Team has well-qualified and experienced Mechanical Engineers.
MFL Inspection Team has in-house facilities for carrying out condition monitoring of Process
Plant Static Equipment, Pipelines and Rotating Equipment and Non-Destructive Testing
Inspection, for our own requirements.
Additionally, to share the experience gained, MFL Inspection Team is taking up third party
services to other Fertilizer Plants, Refineries and Petrochemical Plants throughout India for the
last 25 years.
The services offered by MFL are:
Reformer Catalyst Tubes Ultrasonic Testing by Thro Transmission Technique
Residual Magnetic Fields Survey and Demagnetization of High Speed Turbo Machines,
Deputation of Engineers for Shut Down inspection of Process Plant Equipments
5.1.6 Inspection, Technical & Engineering Consultancy Services
Against a stiff global competition, MFL successfully bagged a Technical Management Contract
from the State Fertilizer Manufacturing Corporation of Sri Lanka (SFMC). The three years
contract was for Plant Operation, Training & Technical Services. The contract earned MFL US
$ 3 million.
MFL has a very capable team of Inspection Engineers, who have been regularly taking up
assignments in various fertilizer and petrochemical plants in India. We also have team of
Engineers, who can provide supervisory services during major Revamp/Modification work.
MFL offers consultancy for setting up of Bio-fertilizer plants on Turn-key basis.
Bio-fertilizer plant of National fertilizers Ltd at Indore was set up by MFL on Turn-key
In 1998, MFL under the sponsorship of FAO, Rome, deputed its expert as Consultant to
Govt. of Ethiopia, to prepare a Project Report for the establishment of Bio-fertilizer
Unit which was completed successfully.
MFL has conducted several R & D Projects on Bio-fertilizers.
6.1.7 FUTURE PLANS
Switching over to Liquefied Natural Gas (LNG) feed stock from naphtha MFL Plants are
designed to use R-LNG as part of Revamping Project and hence switchover to R-LNG can be
done with minimum capital expenditure in a short time. The quantity of LNG required for
replacement of existing fuel is around 1.2 MMSCM per day.
The fertilizers complex of MFL is presently using Naphtha for the process and fuel requirements
of Ammonia Plant, FO in boilers, HSD in Captive Power Plants (Gas Turbine Generators and
Diesel Gensets) and LPG for auxiliary firing in the Boilers, heaters and flares.
Detailed in-house assessment of the changes required for the conversion has been carried out.
Information from external sources, engineering consultants and supplier of boilers has been
gathered and analyzed.
MFL has a creditable record of success in production, energy conservation, promotional
activities and as a responsible corporate citizen.
MFL bagged the prestigious award from Fertilizer Association of India for
“Outstanding performance in Production of Phosphatic Fertilizers” during 1991-92.
Received the Best Farmers Service Award for 1992 instituted by Gandhi Gram Rural
Institute, Tamil Nadu.
Jawaharlal Nehru Memorial National Award for “Effective Implementation of Pollution
Control” 1992-93 and 1993-94.
Video Film on the use of Bio-fertilizers was judged as the best entry by the Fertilizer
Association of India in 1993. In 1994-95 also another film on Bio-fertilizers was judged
as the best entry for the second time.
Video Films on Paddy and Balanced Fertilizer Application were judged as the best
entries for the year 1988 and 1994. A certificate of merit was awarded for the video film
on Banana in 1991.
MFL was conferred with Best Tax Payer Award for the year 1995-96.
MFL received Official Language implementation Award for the year 2003-04.
Environmental Awards won by MFL
Table :5.2 Environmental Awards
Name of Award
Jawaharlal Nehru Gold award for Best Environmental
& Ecological Implementation
J.N Gold award for best Environmental & Ecological
J.N Gold award for Best Environmental & Ecological
Lal Bahadur Sastri Memorial Gold Award for Best
Environmental & Ecological Implementation
Millenium National Award for Best Pollution Control
Implementation Gold Award
International Greenland Society Award for Excellent
Environment & Ecological Implementation
Indira Gandhi Memorial National Award for Best
Environmental & Ecological Implementation
Energy Conservation Awards won by MFL
Table: 5.3 Energy Conservation Awards
II Prize in National Energy Conservation Award
(instituted by ministry of Power)
Best Energy Conservation Implementation Gold Award
National Energy Conservation Award (instituted by
ministry of Power)
International Greenland Society National Award for
Excellent Energy Conservation Implementation Gold
J.N. Best Energy Conservation Implementation Gold
5.1.9 Acts governing the company
Factories Act, 1948.
Workmen‟s compensation Act, 1948.
Employee Provident fund and miscellaneous provision Act, 1952.
Payment of Gratuity Act, 1972.
Maternity benefit Act,1961.
Industrial disputes Act, 1947.
Apprentices Act, 1961.
Equal remuneration Act, 1976.
Trade Union Act, 1926.
Thus the organisational structure process, functions and management activities of M/S Madras
Fertilizers Limited (MFL) are discussed in this report. The Human Resource and Welfare
Department has provided needed information and statistical data about the organisation‟s several
departments and functional areas. From the past years statistics of MFL, it is been experiencing
growth in production and management areas of the organisation. In MFL the employees are well
treated by providing hygienic food for low cost and low cost transport facilities. The
environment of the organisation is planted and maintained by recycled water. Smoke is liberated
at a specific height so that it cannot affect the purity of the environment. The bio-hazardous
waste is disposed in such a way to ensure the safety. The technical employees of MFL are
provided medical facilities and safety equipments inside the production process. The
management secures confidential and their business secrets by not allowing the outsiders to gain
access to the Management Information System.
MFL concentrates on satisfying the need of the farmers and providing quality fertilizers by
research on chemical and bio-fertilizers. Several tests are made with the MFL products before
marketing to the customers. VIJAY brand name has a vast reach among the farmers and still the
brand captures the market with its highly competition global market.
Still MFL sustain in the market with high production of fertilizers which has foreign investments
and public shares. The Government of India has the control over MFL as it captures the majority
shares. MFL Exports their products to several places in India and other countries through
shipping and other transport facilities available.
MFL - Madras Fertilizers Limited
DOF - Department of Fertilizer
- Government Of India
NIOC - National Iranian Company
- Nitrogen, Phosphorous & Potash
- Prills Cooling System
BEDP - Basic Engineering & Design Package
- Distributed Control System
Annual report of Madras Fertilizer Limited