This project report summarizes an inventory management system study of NCL Industries Limited, a building materials manufacturer. The report finds that NCL was not properly implementing inventory techniques like ABC analysis and economic order quantity to determine optimal ordering levels. Implementing these techniques significantly reduced ordering quantities and costs. The report recommends NCL fully adopt inventory management best practices to better control raw materials and finished goods.

1. PROJECT REPORT
TITLE
A STUDY OF INVENTORY MANAGEMENT SYSTEM
AND FINANACE CONTROL
COMPANY NAME
NCL INDUSTRIES LIMITED
Presented by:
Varun Bhardwaj
INSTITUTE OF INTERNATIONAL BUSINESS & RESEARCH

2. CEMENT DIVISION BOARD DIVISION ENERGY DIVISION PREFAB
( Nagarjuna) ( Bison Panel) ( NCL Energy) (NCL Prefab Shelter)
NCL SCCOLOR
NCL ALTEK
NCL HOMES

3. NCL GROUP
 Group of companies manufacturing a range of building
materials.
 The objective of the Group is "to provide comfortable
housing at an affordable price".
 After establishing the Cement plant in 1983 the group
has started identifying building materials which are best
suited for Indian construction industry .
 The group also has interests in Construction, Power
Generation and manufacture of Chemicals.
 The turnover of the group in the Year 2008-2009 is
around Rs 500cr and employs above 1900 people.
 Company head office is in Hyderabad .

4. 1.CEMENT DIVISION
2.BOARD DIVISION
3.PREFAB DIVISION
4.ENERGY DIVISION

5.  NCL made its debut in Indian Industrial Scene by starting to
manufacturing cement under brand name Nagarjuna that enjoys
premium in the Andhra Pradesh Market for its consistent quality and
strength.
 Company diversified its activities by setting up a boards plant for
manufacture of Bison Panel a cement bonded particle board in
collaboration with Bison Werke of Germany .
 It is also in the growth area of Hydel power generation with 2 mini
power projects at identified sources in Andhra Pradesh and
Karnataka
 NCL’s group companies promoted manufacture of Seccolor
prepainted steel profiles for world class windows, doors, partitions,
structural glazing etc
 Having completed 25 years of its existence NCL continues its march
with its corporate mission of offering quality building materials with
the latest technologies.

6.  A multi-purpose Cement Bonded Particle Board
(CBPB) manufactured by NCL Industries Limited for
first time in India, in Technical Collaboration with
BISON WERKE of Germany.
 The Plant has been set up near its Cement Plant in
Nalgonda District of Andhra Pradesh during 1992
 The Boards Division is an ISO 2000 Certified
Company and the Bison Panel conforms to ISO
Standards
 NCL setup new boards plant with an installed
capacity of 50,000 TPA at Paonta Sahib in
Himachal Pradesh to cater the requirements of
North & North-East Regions.

7.  To manage inventory position
 To maintain the record of raw material
as well as physical stock.
 To reduce cost of inventory
 To reduce the wastage of raw material
 To control the flow of raw material and
finished goods according to demand

8.  MAINTAINING PHYSICAL STOCK
REGISTER
(stock detail in month of May 09)
(stock detail in month of June 09)
 MAINTAINING OF DAILY STOCK
REGISTER.
(RG.2007-08) , (RG. 2008-09)
 IMPLEMENTING ABC ANALYSIS
 IMPLEMENTING EOQ METHOD
 IMPLEMENTING LIFO/FIFO
METHOD

9. › The previous order of ppc cement was 21 order per year
but EOQ which was suggested is 353 order per year.
› The previous order of poplar wood was 36 order per year
but EOQ which was suggested is 300 order per year.
› The previous order of aluminum sulphate was 12 order per
year but EOQ which was suggested is 30 order per year.
› The previous order of sodium silicate was 54 order per year
but EOQ which was suggested is 60 order per year.
› The company does not maintain daily stock register as
well as physical stock.

10.  The necessary steps to control its
inventory of Finished Product as well as
Raw Material.
 Inventory position by obtaining proper
inventory methods e.g. ABC Analysis,
EOQ Method, LIFO, FIFO, Etc. can
reduce the cost of inventory.
 Physical stock and daily stock register
can maintain the record of inventory
position.
 Bin Card system should be implemented
in stores to maintain & check store items.

11.  It is to be taken into consideration that the
company was not implementing the ABC and the
EOQ techniques.
 There was a huge variance between the previous
ordering quantity to the quantity proposed by
implementing the inventory valuation techniques.
 To cater market demand in Northern region the
company should focus its Quality Policy as well as
low cost product.