Industrial training report by Dhanapal JD

CHAPTER I
1. INTRODUCTION
The term training refers to the acquisition of knowledge, skills, and competencies as a
result of the teaching of vocational or practical skills and knowledge that relate to specific useful
competencies. This industrial training was undertaken in order to observe and familiarize with
the organizational activities and practical application of the concepts. Basically, the training
covered the areas like functions of department, organization performance, production process
etc.
The sugar industry in India is the best agro-based industry occupying a pre-eminent
position in the economy of the country about 3 Lakhs. Skilled and unskilled workers and 70,000
technicians, besides providing employment to about 27 million cultivators.
HISTORY OF SUGARCANE
Sugarcane is the world’s main source of sugar. In south pacific Islanders grew sugarcane more
than 8000 years ago. The plant was also widely grown in ancient India, the cultivation and
refining of sugarcane to America and the West Indies. Today the leading sugarcane growing
nations include INDIA, BRAZIL, CUBA, MEXICO, THE UNITED STATES AND
PHILPPINES.
Sugarcane provides useful raw material over to 27 industries to produce SUGAR,
JAGGERY AND KHANDSARI and arrange of agro industrial co-products such as ALCOHOL,
PAPER AND NEWS PRINT, VARITEY OF CHEMICALS, and CATTLE AND
ELECTRICITY.
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2. INDUSTRY PROFILE
2.1. Sugar Production:
After two years of large statistical deficit, global sugar economy was calculated to
register a surplus during 2010/11. International sugar organization places them surplus below
one million ton Thailand has shown a remarkable progress in canton. Harvest for 2010-11.
Improved rains and larger use of inputs have helped Thai1. Sugar increase cane yield by 17%.
Stock to consumption ratio 2010-11 is at its lowest in more than two decade.
2.2. Sugar Balance:
World sugar balance (Million tons, raw value)
Source: ISO- May 2011
World sugar prices:
World market values fell steeply during March’11 and April’11 reflecting sharp increase
in sugar availability. Both raw and white sugar demonstrated a downward correction. This year,
sugar has been the worst performer of the 24 commodities on the standard & poor’s GSCI index.
Kinsmen predict volatility to be contained within a downward trend. The reported reduction in
net long positions indicates the fading investor interest in sugar futures on expectations of further
Price easing.
On the demand side, last year higher prices have eaten into the consumption in, India,
china and major sugar consumers.
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2.3. Sugar Prices:
Despite OGL announcement made and stock holding limits increased by the Government,
open market prices continue to retain below the cost of production. The continual higher monthly
releases by Government might be an obvious reason for poor domestic prices that have made
sugar mills lose continuously for more than four months. The estimated surplus over domestic
Off-take may be a constraint for sugar prices to improve in the near term.
2.4. Sugar Futures
The spot and futures prices of sugar witness a bearish trend.
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3. COMPANY PROFILE
Ponni Sugars (Erode) Ltd is an offspring of Ponni Sugars and Chemicals Ltd (PSCL)
under a Demerger Scheme sanctioned by the Hon’ble High Court of Madras on 10th September
2001. In terms of the Scheme, the company took over the business of Erode Undertaking with
concurrent transfer of major part of stakeholders’ interest in PSCL to the company.
The Erode sugar mill was set up with 1270 TCD capacity in 1984 in a record time of 12
months. It achieved full capacity crushing during the very first year of its commercial operation
that enabled declaration of a maiden dividend of 10% in that very first year, a record in the
annals of sugar industry. It was a trendsetter in mobilising surplus cane during its infancy
stage from neighbouring sugar mills and extending crushing season to well above industry
average. Its capacity was expanded to 2700 TCD in 1994.
The Erode sugar mill has successfully implemented an innovative Lift Irrigation
Scheme by bringing in dry lands under cane cultivation, utilizing the effluent discharge of the
neighbouring paper mill. This has helped secure multitudinal benefits – providing a dependable
and perennial source of irrigation to farmers in the neighbourhood, increase of land value
manifold in the region, transforming the livelihood of local rural population, resolving the raw
material needs of sugar and paper mills and addressing ecological concerns in effluent discharge
Right at its inception, Ponni was structured on the concept of total diversion of
bagasse for paper. Accordingly it installed a coal fired boiler and later added a multi fuel boiler
in place of conventional bagasse fired boilers. It has a bagasse tie up arrangement with
Seshasayee Paper and Boards Ltd for a mutually beneficial and rewarding long term relationship.
Ponni is an efficient and quality producer of sugar, catering to both domestic and
international markets. It is a venerable partner for villagers growing sugarcane in its
neighbourhood. It enjoys cordial relationship with employees. It firmly believes in transparent
and fair dealings with all its stakeholders by following sound corporate governance norms both
in letter and spirit.
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Ponni Sugars is the brainchild of late S Viswanathan, affectionately referred to as SV by
his friends & associates, a renowned industrialist of the South. SV was a lawyer-turned freedom
fighter-turned industrialist of a unique genre. He was a close associate of late Jaya Prakash
Narayan. He teamed up with Sri R Venkataraman, former President of India, to practise Law at
Chennai. He joined in 1977 the House of Seshasayee, a Managing Agency firm of repute in that
era.
With the untimely death of Sri V Seshasayee, SV took on the mantle, and established
in quick succession between 1978 and 1962 four industrial enterprises, namely, Seshasayee
Industries Ltd, Neyveli Ceramics and Refractory’s Ltd, SEMCO Meters Ltd and Seshasayee
Paper and Boards Ltd. He later established Ponni Sugars and Chemicals Ltd, SPB Projects
and Consultancy Ltd, Esvin Advanced Technologies Ltd etc.
The magnum opus of SV was the creation of Tamil Nadu Newsprint and Papers Ltd. He
took total charge and responsibility from concept to commissioning of this pioneering venture.
This was the first ever mill to produce, successfully, newsprint out of sugarcane bagasse
anywhere in the world and it received the acclaim of World Bank. This continues to be one of
the top profit performers for the Tamil Nadu Government.
SV entered the sugar industry rather late in his illustrious career. Sugar was just
incidental to his cherished goal. He despised the denudation of precious forest wealth in
producing paper. He realized long before that for the long-term survival of paper industry, a
strategic shift to a sustainable, viable alternative source of raw material was imperative. For this,
he sought to create an interdependence, which he called a marriage, between paper and sugar
industries to resolve the raw material shortage for paper industry, strengthen the viability of
sugar industry and simultaneously preserve forest cover and protect environment for public
good.
SV in this resolve promoted Ponni Sugars, which became the first sugar mill in the
country to use alternative fuel in its boilers and release its bagasse in entirety for paper making.
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SV was a rare phenomenon rising from his obscure beginnings to set up industrial
enterprises o f great national significance, with enviable records of adherence to the code of
business ethics. He fused the values of commerce and nationalism in his corporate creations.
He was prone to take high risks and loved to be challenged. The risks, in fact,
spurred him into action. Of taking risks, he said, “Legitimate risks are to be taken to make
progress in one’s Endeavour’s. If we do our homework thoroughly and convince ourselves of
the success of the project and its larger usefulness to the society, if we have no vested interests,
we can embark on any risky project.”
SV passed away on 22nd July 2001 after a brief illness. He was a ‘Visionary’ par
excellence and ‘Karmayogi’, non-peril.
3.1. Date Chart:
26-12-1996 Company incorporated under the name SPB Sugars and Chemicals Limited
27-01-2000 Name of the company changed to Ponni Sugars (Erode) Limited
10-09-2001 Demerger Scheme for the transfer of Erode Undertaking of Ponni Sugars and
Chemicals Ltd established in 1984 to the company effective 01.04.1999.
Sanctioned by High Court of Madras.
18-10-2001 Completion date of Demerger Scheme which comes into effect from
01.04.1999.
3.2. Factory Factsheet:
Year of Establishment : 1984
Initial Capacity (TCD) : 1270
Present Capacity (TCD) : 2700
Factory Area (acres) : 33.71
Colony Area (acres) : 9.10
No of Employees
Regular - 233
Seasonal – 138
: 371
No. of Employee Quarters : 147
No. of Cultivators : 7477
Annual Cane Area under
Registration (acres)
: 21300
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3.3. Group Companies:
Seshasayee Paper and Boards Limited
Seshasayee Paper and Boards Ltd (SPB) is a large paper mill situated at Erode, Tamil
Nadu concentrating on production of fine papers. SPB was established in 1960. Today SPB
produces over 120,000 tpa of fine papers and exports around 20% of its turnover. The
manufacturing range is from 28 gsm to 270 gsm in its varied MF, MG and Yankee machines.
SPB is ISO 9001 and 14001 certified.
High Energy Batteries (India) Limited
High Energy Batteries (India) Limited (HEB) manufactures Silver Zinc and Nickel
Cadmium batteries for defense and space research. HEB is located at Mathur, near Trichy, Tamil
Nadu. The Indian Armed Forces and Space Research Institutions are its valued customers. HEB
is well known for its quality and ability to develop need specific batteries for defense and space
research. HEB is ISO 9001 and 14001 certified.
SPB Projects and Consultancy Limited
SPB-PC is an engineering consultancy company based at Chennai, Tamil Nadu, India,
offering a wide range of engineering and technical services in the pulp & paper, sugar, industrial
power generation, ceramics and environmental management sectors. In the long run SPB-PC
would aim to become a global engineering outsourcing company leveraging its vast and varied
engineering skills for various applications while retaining its core skills and eminence in the
industries it serves today.
Esvin Advanced Technologies Limited
Esvin Advanced Technologies Limited (Esvin Tech) is situated at Chennai with its research
and production facilities located around Erode, Tamil Nadu. Esvin Tech was floated in 1988.
The company has since then successfully developed a Gasification Technology (with
American Collaboration) for treatment of liquid effluents, patented a process for manufacture of
liquid sugar from raw sugarcane juice at Ponni Sugars, promoted the awareness of enzymatic
bleaching through large scale manufacture and mill scale trials both in India and China, and
is currently manufacturing biofertilisers, biopesticides etc at its facilities in Erode.
3.4. Board of Directors
The composition of the Board is well balanced with expertise drawn from Industry,
Management, Finance and Agriculture. All except the Managing Director are non-executive
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Directors. The Chairman is non-executive and the number of Independent Directors is more than
1/3rd of the total strength.
Director’s Profile:
Name/Title Qualification Expertise in specific functional areas
N Gopala Ratnam
Chairman
B.Sc (Physics)
B.E (Mech)
Renowned specialist in pulp & paper technology, having
experience in management of projects, operations and overall
management of diverse industries engaged in pulp, paper, sugar
and batteries.
Dr L M
Ramakrishnan
Vice Chairman
M.B.B.S., D.L.O Doctor turned educationist engaged in the management of
educational institutions. Well respected by the local farming
community.
Arun G Bijur
Director
B.E (Chemical-
Engineering)
Long and varied experience in managing large scale projects
involving coordination of all phases of engineering,
procurement, construction, startup and commissioning activities
of various Pulp and Paper mills, Sugar mills and Ceramic units.
Bimal Poddar
Director
B.Com Varied experience in the spheres of finance, administration &
general management. Widely travelled throughout the world on
business visits.
C K Pithawalla
Director
B.E (Mech) A successful NRI businessman having diverse interests in UK,
Germany and Switzerland.
N Ramanathan
Managing Director
ACA, ACS
AICWA
Professional expertise in diverse disciplines of Finance,
Taxation, Accounts and General Management.
S K Ramasamy
Director
Intermediate Agriculturist having experience in sugarcane cultivation and
having wide contacts among local farming community.
N R Krishnan, IAS
(Retd)
Director
B.Sc (Hons),
M.Sc.,
Rich and varied experience in Administration and General
Management. Held several high positions in State and Central
Governments. Served as non-executive director on the Boards of
several large Public Sector Undertakings and Financial
Institutions.
V Sridar
Director
B SC, ACA Rich experience in Banking, Finance and General Management.
Held several high positions in commercial banks and National
Housing Bank.
Dr Mrs Nanditha
Krishna
Director
Ph D An Authority on indology and an environmental educationst.
Specialised in Indian Art and Culture, Environmental History
and Ecological Heritage of India and Cambodian Art.
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3.7. Committees:
Audit Committee Finance Committee
Securities
Transactions cum
Investors Grievance
Committee
Remuneration
Committee
V Sridar (Chairman)
N Gopala Ratnam
(Chairman)
N Gopala Ratnam
(Chairman)
V Sridar
(Chairman)
Bimal Poddar Bimal Poddar Arun G Bijur N Gopala Ratnam
Dr. L.M. Ramakrishnan Arun G Bijur N. Ramanathan Dr.L.M. Ramakrishnan
N R Krishnan N. Ramanathan N R Krishnan
3.6. Key Executives:
Name /
Designation
Qualification Experience Functional Responsibility
R.Chandramouli
President
B.Sc, ANSI
More than 3 decades of
experience in sugar industry
operation and general
management
Chief Operating Officer in
charge of Erode Sugar Mill
K.Yokanathan
Chief Financial
Officer
B.Com, ACA
Vast experience in the area of
finance, accounts, taxation,
marketing and administration
In charge of finance, accounts,
marketing and general
administration of the Mill
M.Shanthan
Vice President
(Cane)
M.Sc,(Agri)
Vast experience in sugar cane
development and management.
In charge of cane development
operations of the mill
3.7.Offices:
Registered Office Factory
Esvin House,
No.13 Old Mahabalipuram Road,
Seevaram Village, Perungudi ,
Chennai 600 096
Odapalli,
Cauvery R.S.
Pallipalayam, Erode 638 007
Phone : (044) 39279300 Phone : (04288) 247371 (8 lines)
Fax : (044) 24960176 Fax : (04288) 247363
Email : admin@ponnisugars.com Email : gen@ponnisugars.com
Other Offices:
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New Delhi
Mr. V. Swaminathan
B-213,Second floor
Phase - I,
Naraina Industrial Area
New Delhi 110028
Ph : 27792779/60
Mobile: 9910233676
E-mail: hinergy@bol.net.in
Mumbai
Mr .Rajan Ramji
7/27 Grants Building, 3rd Floor
Arthur Bender Road
Colaba
Mumbai 400 007
Phone: (022) 22340217 / 22833677
Fax: (022) 22049736
E-mail: rajanjaguar@hotmail.com
Kolkata
Mr V.R.V. Narayan
Preyasee’
Flat No.1-C, 1st Floor
No.2, Motilal Nehru Road
Kolkata 700 029
Phone: (033) 24643771/ 24666018
Fax:(033) 24643771
E-mail: caloff@cal2.vsnl.net.in
3.8.Code of Conduct:
Statement of Values
The Company belongs to Esvin Group founded on cherished principles of high level of
integrity, trust, transparency, law abiding and societal value creation. It is stridently committed to
uphold the core values of the Group and promote professionalism and high standards of business
ethics in the conduct of its business.
Vision
The company is committed to excel as a trusted, socially responsible and customer driven
organization providing maximum value to all stakeholders.
Mission
The company would strive to manufacture quality products at competitive cost through
technology and team work.
Financial Reporting
The Company shall prepare financial statements and maintain accounting records fairly
and correctly in conformity with applicable accounting and financial reporting standards. There
11

shall be true and faithful l disclosure of information and unrestrained access to records to the
auditors and statutory authorities. There shall be no wilful omission of recording company
transactions or manipulation of company accounts.
Internal Auditor shall have free and unhindered access to all company information with
liberty to interact with company officials at all levels.
Professional Environment
The company shall provide professional environment with singular emphasis on merit and
performance for the growth of employees. There shall be no discrimination in recruitment or
promotion on account of race, caste or religion.
Recruitment preference for unskilled jobs may however be given to the heirs of employees
dyeing in harness or to residents of the locality in which the company operates and also
in compliance of Government policy.
Political non-alignment
The company shall not support, directly or indirectly, any specific political party or group or
a candidate for political office.
Environmental Policy
The company shall provide a safe and healthy working environment. It shall diligently
adhere to all statutory and regulatory norms in the preservation and promotion of the environment
and bestow utmost care in not interfering with the environment of the territory it operates in.
The company is committed to prevent wasteful use of natural resources and minimize any
hazardous impact of the development, production, use and disposal of its products and services on
the ecological environment.
Society Consciousness
The company shall not only comply with all relevant laws and regulations but also actively
assist in the improvement of the quality of life of the people in the locality in which it operates. Its
social responsibility endeavour would cover supporting community initiatives on health and family
welfare, water management, vocational training and educational literacy.
Information sharing
The company shall provide timely, regular and reliable information on its activities and
cooperate with the media in making available required information on its structure, operations
and plans excepting those considered confidential.
It shall put on its website and furnish to Stock Exchanges price sensitive information and
12

periodical disclosures. It shall promptly respond to the information requirement of its stakeholders
and public.
Business Partners
The company is committed to establishing mutually beneficial relations with its suppliers,
customers and business partners and not indulge in any coercive or oppressive business practices.
The company recognizes cane growers as its valued business partners and is committed to treat
them in a fair and equitable manner and strive for their continual knowledge and skill up gradation.
Shareholders
The company is committed to enhance shareholder value and comply with all laws and
regulations governing shareholders' rights. It shall duly and fairly inform its shareholders of all
material developments of its business and disclose requisite information in accordance with SEBI
Regulations and Stock Exchange Listing Agreement.
Code of conduct
All Directors and Senior Management shall act within the bounds of the authority conferred
upon them with commitment to make policies and take informed decisions in the best interest
of the company and its stakeholders.
With a view to maintain the high standards that company has set, the following Rules/ Code
of conduct shall be observed by all directors (which term shall also include senior management
where the context so admits) and by all its employees as well, as applicable. All directors and
employees shall diligently follow and steadfastly pursue the 'Statement of Value' as basic tenets in
their conduct.
Ethical conduct
All directors shall conduct their activities with honesty, integrity and fairness and display high
moral and ethical standards, which shall be fair and transparent and be perceived to be as such by
third parties.
Conflict of interest
Directors shall not engage in any business, relationship or activity detrimental to or in conflict
with the interest of the company or the group. Related party transactions shall be truly and
faithfully disclosed to the CFO, Audit Committee and the Board.
Compliance with law
Directors shall comply with all applicable laws, rules and regulations both in letter and spirit.
Confidentiality
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Any information concerning the company's business and not in the public domain to which
the director is privy or has access must be considered confidential and shall not be disclosed unless
authorized to do so or when required by law.
Gifts and donations
No director shall receive or offer, directly or indirectly, any gift, donation, remuneration,
hospitality, illegal payment or comparable benefit which are intended or perceived to be intended
to obtain business or uncompetitive favours for the conduct of business. Normal gifts on customary
occasion or of commemorative nature may however be given or received.
Protection of assets
Directors shall protect the company's assets, labour and information and not use them for
personal benefit unless approved as part of remuneration package.
Integrity of data furnished
Directors shall ensure at all times the integrity of data or information furnished to the
company.
Citizenship
Directors shall in private life be free to pursue active role in civic and political affairs subject
however that it does not adversely affect the business interests of the company or the group.
General conduct
Directors shall conduct themselves and their activities both in and outside the company in
such a manner as not to adversely affect the image or the reputation of the company.
Reporting
Directors shall bring to the attention of the Board, Chairman, or the Managing Director as
appropriate any information or development either within the company (relating to its employees
or other stakeholders) or external that could impact the company's operations and which in the
normal course may not have come to the knowledge or notice of the company.
Compliance - Monitoring
Compliance with these principles is considered an essential element in company's business
success. The Board and Audit Committee are responsible for ensuring that these principles
are communicated to, understood and observed by all employees as appropriate.
Day-to-day responsibility is delegated to the senior management which is responsible
for implementing these principles, if necessary through more detailed operating guidelines.
Assurance of compliance is given and monitored each year. Compliance with the code is subject
to review by the Board supported by the Audit Committee. The company appoints the Company
14

Secretary as compliance officer for the purpose of Code. Employees are expected to bring to his
attention any breach or suspected breach of these principles. Such reporting will be held in strict
confidence and no employee will suffer as a consequence of doing so.
3.9. Objectives:
Main objectives to be pursued by the company on its incorporation.
 To carry on the business as manufactures, procedures, sellers, distributors, stockiest and
traders of sugars and its derivatives Molasses, a Bagase and all materials and substances
arising as by-products out of land in the course of manufacture of sugar.
 To carry on the business as manufactures, procedures, brewers, slanders, distillers,
stockiest and traders of rectified sprit, gasohol, acetic acid, acetone, acetic anbydride
vinyl acete, polymers, plastic, poly vinyl chloride liquor and all products made there
from.
 To carry on the business as manufactures, procedures, packers, dealers, stockiest, and
traders of bulk drugs, pharmaceutical and medicinal preparation made out of by-products
of sugar or their derivatives.
 To carry on the business of setting up an operating facilities for generation, co-
generation, transmission, distribution, supply, sales, sales either directly or through
others, energy including electricity for captive use or for sale to grids, using bagase, coal,
lignite, petroleum products or any other substances including wind, solar energy or any
other form of energy.
 To grow, buy, alter, improve and deal in all kinds of sugarcane and other raw materials.
 To purchase or hire goods, materials, machinery or services on credit or otherwise.
 To enter into and adopt pre-incorporation contracts and to pay for preliminary and pre-
incorporation expenses of the company.
 To undertake and excite any trust which may be considered beneficial to the company,
either directly or indirectly.
 To amalgamate with any other company or components having objects altogether or in
post similar to those of this company.
Other objectives:
 To carry on the business of clearing and forwarding agents for clearing and forwarding of
any and all goods by road, rail, air, sea or by any other means.
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 To carry on the business of manufactures, procedures, dealers, distribution and traders of
food stuffs, bakeries, confectionaries, mill products and beverages.
 To act as underwriters, commission agents, advertising agents, travelling agents, brokers,
estate agents and hardware merchants.
 To carry on the business of manufactures/dealers of cement and related products.
 To act as financial, technical, management consultants and provide advice, service and
consultancy in various fields, such as secretarial, commercial. Statistical, financial, legal,
economic, labor, industrial, public relations and general administrations.
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