Documente Academic
Documente Profesional
Documente Cultură
2012 2013
DECLARATION
I hereby declare that the project report entitled "A REPORT ON INVENTORY
MANAGEMENT IN SEW INFRASTRUCTURE LIMITED, is a record of
independent research work and has been carried out by me during the period of my study
at LAKIREDDY BALIREDDY COLLEGE OF ENGINEERING, Mylavaram under
the guidance of Dr.V.SREEHARI
STUDIES, and has not been submitted elsewhere for any degree either in part or whole.
Signature
(RAJESWARI.M)
________________________________________________________
Date: ----------
CERTIFICATE
This is to certify that the project report entitled A REPORT ON INVENTORY
MANAGEMENT IN SEW INFRASTRUCTURE LIMITED, submitted by
RAJESWARI.M in partial fulfillment of the work award of the MASTER OF
BUSINESS ADMINISTRATION submitted to J.N.T.U, Kakinada has been completed
under my supervision and guidance.
This project has not been submitted earlier for the award of any degree or diploma
of J.N.T.U, Kakinada or any other university.
Dr.V.SREEHARI Ph.D.
Professor
Head of Department
Project Guide
EXTERNAL EXAMINER
INTERNAL EXAMINER
ACKNOWLEDGEMENT
Signature
(Rajeswari.M)
CONTENTS
Pg.No
CHAPTER-I
INTRODUCTION
CHAPTER-II
PROFILES
CHAPTER -V
Appendices
Bibliography
INVENTORY MANAGEMENT
Material is a very important factor of a production. It includes physical commodities
used to manufacture the final product. It is the inventorial and does not get waste and
exhaust with the passage of time as labour is wasted with the passage of time whether in
used or not. The other feature of material is that, is firm, where as other elements of cost
like labour and other services cant be easily varied once they are established. From this it
can be concluded that material is most flexible on controllable input. It is the first and
most important element of cost. Materials account for nearly 60% of the cost of
production which is clear from analysis of financial statements of a large number of
private and public sector organizations.
According to the Indian association of materials management of 64 paisa in
a rupee are spent on materials by Indian industries, 16 paisa on labour and the rest of 1
rupee of cost is spent on over heads. Importance of material control lies in the fact that
any saving made in the cost of materials will go a long way in reducing the cost of
production and improving the profitability of the concern. Studies by experts in this field
have highlighted the facts that if an organization can
it would be as good as increasing the production or sales by about 36%. Proper control of
material is necessary from the time orders for purchasers of materials are placed with
suppliers until they have been consumed the object of material control is to attack
material cost on fronts, so that the cost of material may be reduced. In other words,
efforts are to be made to reduce the cost of materials when it is purchase, stored and used.
Before coming to the discussion of material control, we may clear that purchase
of materials will include both direct and indirect materials. Direct materials and indirect
material share both treated as stores items, where as stock of finished goods is not treated
as a stores item, direct and indirect materials purchased for stock purpose to be issued to
different jobs, works orders of departments as and when required. On the other hand,
finished goods are treated as stock. We may also refer to the commonly used term
INVENTORY which includes the stock not only of raw materials but also stores and
spares, work-in-progress and finished goods. The stock materials are only a part of the
inventory held by a manufacturing unit.
Every enterprise needs inventory for smooth running of its activities. It serves as a link
between production and distribution process. There is generally a time lag between the
recognition of a need and its fulfillment. The greater the time lag, the higher requirements
for inventory. It also provides a question for future price fluctuations. The investment in
inventories constitutes the most significant part of current assets/ Working capital most of
the undertaking.
Thus, it is very essential to have proper control and management of inventories.
The purpose of inventory management is to ensure availability of materials in sufficient
quantity as and when required and also to minimize investment in inventories.
position for further use. All decisions about spare are base of the financial cost of
inventory on such spares and the costs that may arise due to their non-availability.
BENEFITS OF HOLDING INVENTORIES:
Although holding inventories involves blocking of a firm's funds and the
costs of storage and handling, every business enterprise has to be maintain certain level of
inventories to facilitate uninterrupted production and smooth running of business.
In the absence of inventories a firm will have to make purchases as soon as
it receives order. It will mean loss of time and delays in execution of orders which
sometimes may causes loss of customers and business. A firm also needs to maintain
inventories to reduce ordering cost and avail quantity discounts etc.
There are three main purposes of holding inventories.
1.The transaction motive: which facilitates continuous production and timely execution
of sales orders.
2.The precautionary motive: Which necessitates the holding of inventories for meeting
the unpredictable changes in demand and supplies of materials.
3.The speculative motive: which induces to keep inventories for taking advantage of
price fluctuations, saving in re-ordering costs and quantity discounts.
RISK AND COSTS OF HOLDING INVENTORIES: The holding of inventories
involves blocking of a firm 's funds and concurrence of capital and other costs.
The various costs and risk involved in holding inventories are:
1.Capital Costs: Maintaining of inventories results in blocking of the firms financial
resources. The firm has therefore to arrange for additional funds to meet the cost of
inventories.
The fund may be arranged from own resources of firm outsiders. But in both the
case, the firm incurs a cost. In the former case, there is an opportunity cost of investment
while in the later case, the firm has to pay interest to the outsiders.
2.Storage and handling costs: Holding of inventories also involves cost on storage as
well as handling of materials. The storage of costs includes the rental of the go down,
insurance charges etc.
3.Risk of price decline: There is always a risk of reduction in the prices of inventories by
the suppliers in holding inventories. This may be due to increase market suppliers,
competition or general depression in the market.
4.Risk of obsolescence: The inventories may become obsolete due to improved
technology, change in requirements, change in customer tastes etc.
5.Risk determination in quality: The quality of materials may also deteriorate while the
inventories are kept.
Inventory management is concerned with the determination of optimum level
of investment for each components of inventory and the efficient use of components and
the operation of components and the operation of an effective control and review of
mechanism. The main objectives of inventory management are operational and financial.
The operational objective is that the materials and spares should be available in sufficient
quantity so that work is not disrupted for want of inventory.
The financial objective is that the materials and spares should be available in
sufficient quantity so that work is not disrupted for want of inventory. The financial
objective means that investment in inventory should not remain idle and minimum
working capital be locked in it.
The following are the objectives of inventory management:
1. To ensure continuous supply of materials, spares and finished goods so that production
should not suffer at any time and the customers demand should also be met.
2. To avoid both over-stocking and under-stocking of inventory.
3.To maintain investment in inventories at the optimum level as required by the
operational and sales activities.
4. To keep material cost under control so that they contribute in reducing the cost of
production and over all costs.
5.To eliminate duplication in ordering or replenishing stocks .This is possible with the
help of centralizing purchases.
6. To minimize loses through deterioration, pilferages, wastages, and damages.
7. To ensure perpetual inventory control so that materials shown in stock ledgers should
be actually lying in the stores.
8 .To ensure right quality goods at reasonable prices. Suitable quality standards will
ensure proper quality of stocks. The price-analysis, the cost-analysis and value analysis
will ensure payment of proper prices.
9.To facilitate furnishing of date for short- term and long term planning and control of
inventory.
TOOLS AND TECHNIQUES OF INVENTORY MANAGEMENT:
A proper inventory control not only helps in solving the actual problem of liquidity but
also increase profits and causes substantial reduction in the working capital of the
concern.
Determination of stock levels:
Carrying of too much and too little of inventory is determined to the firm. If the inventory
level is too little, the firm will face frequent stock outs involving heavy
ordering cost and if the inventory level is too high it will be unnecessary tie up of capital.
An efficient inventory management requires should maintain an optimum level of
inventory where inventory costs are the minimum and at the same time there is no stock
out which may result in loss or shortage of production.
Minimum stock level: It represents the quantity below its stock of item should not be
allowed to fall.
Lead-time: A purchase firm requires some time to process the order time is also required
by the supplying firm to execute the order. The time taken in processing the order and
then executing it is known as lead time.
Rate of consumption:
It is the average consumption of materials in the factory. The rate of consumption will be
decided on the basis of past experience and production plans.
Nature of material:
The nature of material also affects the minimum level. If a material `is required for such
material.
Minimum stock level can be calculated with the help of following formula
Minimum stock level = Re ordering level (Normal consumption x normal re order period)
Re ordering level:
When the quantity of materials reaches at a certain figures then fresh order is sent to get
material again. The order is sent before the materials reach minimum stock level. Re
ordering level is fixed between minimum level and maximum level.
Re-ordering level = Maximum consumption x Maximum Re-order period.
Maximum Level:
It is the quantity of materials beyond which a firm should not exceed its stocks. If the
quantity exceeds maximum level limit then it will be overstocking. Overstocking will
mean blocking of more working capital, more space for storing the materials, more
wastage of materials and more chances of losses from obsolescence.
Maximum Stock Level = Re-ordering Level + Re-order Quantity (Minimum
consumption x Minimum Re-order period)
Danger Stock Level:
It is fixed below minimum stock level. The danger stock level indicates emergence of
stock position and urgency of obtaining, fresh supply at any cost.
Danger stock level = Average Rate of consumption x Emergency delivery time
Average stock level:
This stock level indicates the average stock held by the concern.
Average stock level = Minimum stock level + x Re-order quantity.
Determination of safety stocks:
Safety stock is a buffered to meet some unanticipated increase in usage. The demand for
materials may fluctuate and delivery of inventory may also be delayed and in such a
situation the firm can face a problem of stock out.
In order to protect against the stock out arising out of usage fluctuation, firms usually
maintain some margin of safety stock. Two costs are involved in the determination of this
stock that is opportunity cost of stock outs and the carrying costs.
If a firm maintains low level of safety frequent stock outs will occur resulting into the
larger opportunity costs. On the other hand, the larger quantity of safety stock involves
carrying costs.
made on
need
production
Notifies storeroom Requisition is recorded in
clerk of need
cost
records
materials
used
costs
to
by
cost
sheets
used
when
Journal Entry:
To record total of requisition summary
Dr. Work in process
Cr. Raw materials inventory
The first step is the recognition of the fact that materials are needed for
production. Workers, foreman and production control personnel are
usually the people that recognize the need for material.
The store requisition is prepared in order to obtain materials from the
storeroom.
The stores requisition is the basic document behind general and subsidiary
ledger entries charging materials to work in process. The general Ledger
entry resulting from stores requisitions is simply a transfer of materials
from the raw materials inventory to the work in process inventory. Such an
entry is as follows:
Dr. Work in Process
Cr. Raw materials inventory.
Store Requisition:
The stores requisition is the document that is used to notify the stores
room that materials are to be released for production.
For control purposes it is best to have the foreman and /or specified
production control personnel requisition the materials.
In some plants the production control department may issue stores
requisition at the same time that production schedules are issued.
The foremen in such cases might be restricted only to the issuance of the
requisition for materials required in excess of estimated or standard
quantities.
This excess stores requisition is usually a distinct form which might
required a supervisor's signature as well as foreman's signature.
Waste of material can't be hidden for long when excess stores requisition
are used.
Inventory of Obsolescence:
Obsolescent inventories cannot be used or disposed off at values carried
on the books. Frequent reviews should be made of all inventories and
when obsolescence is indicated a request for revaluation should be
prepared for approval by management.
The difference between original and obsolete value should be recorded by
a charge to an operating account. Inventory obsolescence, and a credit to
inventory. If the material is scrapped, this will be for the full inventory of
the material.
If it is anticipated that the material can be sold at reduced value or used in
areas where it will be worthless than its original value, the entry would be
only for the amount of write down.
Some companies carry a salvage inventory and transfer to its materials
which may be sold or used at reduced value.
CHAPTER-II
OBJECTIVES AND RESEARCH METHODOLOGY
CHAPTER-III
3.1 INDUSTRY PROFILE
The Construction industry of India is an important indicator of the development as it
creates investment opportunities across various related sectors. The construction industry
has contributed an estimated 3,84,282 crore to the national GDP in 2010-11 around
construction activities across all segments; medium sized companies specializing in niche
activities activities; and small and medium contractors who work on the subcontractor
basis and carry out the work in the field. The sector is labour-intensive and, including
indirect jobs, provides employment to more than 35 million people.
History:
The period from 1950 to mid 60s witnessed the government playing an active role in the
development of these services and most of construction activities during this period were
carried out by state owned enterprises and supported by government departments. In the
first five-year plan, construction of civil works was allotted nearly 50 per cent of the total
capital outlay.
The first professional consultancy company, National Industrial Development
Corporation (NIDC), was set up in the public sector in 1954. Subsequently, many
architectural, design engineering and construction companies were set up in the public
sector (Indian Railways Construction Limited (IRCON), National Buildings Construction
Corporation (NBCC), Rail India Transportation and Engineering Services (RITES),
Engineers India Limited (EIL), etc.) and private sector (M N Dastur and Co., Hindustan
Construction Company (HCC), Ansals, etc.).
In India Construction has accounted for around 40 per cent of the development
investment during the past 50 years. Around 16 per cent of the nation's working
population depends on construction for its livelihood. The Indian construction industry
employs over 3 crore people and creates assets worth over 20,000 crore.
It contributes more than 5 per cent to the nation's GDP and 78 per cent to the gross capital
formation. Total capital expenditure of state and central govt. will be touching
8,02,087crores in 2011-12 from 1,43,587 crores .
The share of the Indian construction sector in total gross capital formation (GCF) came
down from 60 per cent in 1970-71 to 34 per cent in 1990-91. Thereafter, it increased to 48
per cent in 1993-94 and stood at 44 per cent in 1999-2000. In the 21st century, there has
been an increase in the share of the construction sector in GDP and capital formation.
GDP from Construction at factor cost (at current prices) increased to 1,74,571 crores in
2004-05 from
1,16,238 crores (10.39% of the total GDP) in 2000-01.
The main reason for this is the increasing emphasis on involving the private sector
infrastructure development through public-private partnerships and mechanisms like
build-operate-transfer (BOT), private sector investment has not reached the expected
levels.
The Indian construction industry comprises 200 firms in the corporate sector. In addition
to these firms, there are about 1,20,000 class A contractors registered with various
government construction bodies. There are thousands of small contractors, which
compete for small jobs or work as sub-contractors of prime or other contractors. Total
sales of construction industry have reached 42,885.38 crores in 2004 05 from 21,451.9
crores in 2000-01, almost 20% of which is a large contract for Benson & Hedges.
Future Challenges:
The Indian economy has witnessed considerable progress in the past few decades. Most
of the infrastructure development sectors moved forward, but not to the required extent of
increasing growth rate up to the tune of 8 to 10 per cent. The Union Government has
underlined the requirements of the construction industry.
With the present emphasis on creating physical infrastructure, massive investment is
planned in this sector. The Planning Commission has estimated that investment
requirement in infrastructure to the tune of about 14,50,000crore or US$320 billion
during the 11th Five Year Plan period.
This is a requirement of an immense magnitude. Budgetary sources cannot raise this
much resources. Public Private Partnerships (PPP) approach is best suited for finding the
resources. Better construction management is required for optimizing resources and
maximising productivity and efficiency.
Infrastructure:
Infrastructure is basic physical and organizational structures needed for the operation of
a society or enterprise, or the services and facilities necessary for an economy to function.
It can be generally defined as the set of interconnected structural elements that provide
framework supporting an entire structure of development. It is an important term for
judging a country or region's development.
The term typically refers to the technical structures that support a society, such as roads,
bridges, water supply, sewers, electrical grids, telecommunications, and so forth, and can
be defined as "the physical components of interrelated systems providing commodities
and services essential to enable, sustain, or enhance societal living conditions."
Viewed functionally, infrastructure facilitates the production of goods and services, and
also the distribution of finished products to markets, as well as basic social services such
as schools and hospitals; for example, roads enable the transport of raw materials to a
factory. In military parlance, the term refers to the buildings and permanent installations
necessary for the support, redeployment, and operation of military forces.
treatment
and
disposal;
electric
power
generation
and
transmission;
telecommunications; and hazardous waste management and the combined system these
modal elements comprise. A comprehension of infrastructure spans not only these public
works facilities, but also the operating procedures, management practices, and
development policies that interact together with societal demand and the physical world
to facilitate the transport of people and goods, provision of water for drinking and a
variety of other uses, safe disposal of society's waste products, provision of energy where
it is needed, and transmission of information within and between communities."
In Keynesian economics, the word infrastructure was exclusively used to describe public
assets that facilitate production, but not private assets of the same purpose. In postKeynesian times, however, the word has grown in popularity. It has been applied with
increasing generality to suggest the internal framework discernible in any technology
system or business organization.
Transportation infrastructure:
Mass transit systems (Commuter rail systems, subways, tramways, trolleys, City
Bicycle Sharing system, City Car Sharing system and bus transportation)
Railways, including structures, terminal facilities (rail yards, train stations), level
crossings, signaling and communications systems
Ferries
For canals, railroads, highways, airways and pipelines see Grbler (1990), which
provides a detailed discussion of the history and importance of these major
infrastructures.
Energy infrastructure:
Natural gas pipelines, storage and distribution terminals, as well as the local
distribution network. Some definitions may include the gas wells, as well as the
fleets of ships and trucks transporting liquefied gas.
Specialized coal handling facilities for washing, storing, and transporting coal.
Some definitions may include Coal mines.
Steam or hot water production and distribution networks for district heating
systems.
Coal mines, oil wells and natural gas wells may be classified as being part of the mining
and industrial sector of the economy, not part of infrastructure.
Drinking water supply, including the system of pipes, storage reservoirs, pumps,
valves, filtration and treatment equipment and meters, including buildings and
structures to house the equipment, used for the collection, treatment and
distribution of drinking water
Major flood control systems (dikes, levees, major pumping stations and
floodgates)
Large-scale snow removal, including fleets of salt spreaders, snow plows, snow
blowers, dedicated dump trucks, sidewalk plows, the dispatching and routing
systems for these fleets, as well as fixed assets such as snow dumps, snow chutes,
snow melters
Communications infrastructure:
Television and radio transmission stations, including the regulations and standards
governing broadcasting
The Internet, including the internet backbone, core routers and server farms, local
internet service providers as well as the protocols and other basic software
required for the system to function (does not include specific websites, although
may include some widely-used web-based services, such as social network
services and web search engines)
Communications satellites
Undersea cables
Seismometer networks
Geodetic benchmarks
Governance infrastructure:
centers,
communication
facilities,
major
weapons
systems,
Economic infrastructure:
The financial system, including the banking system, financial institutions, the
payment system, exchanges, the money supply, financial regulations, as well as
accounting standards and regulations
Social infrastructure:
The health care system, including hospitals, the financing of health care, including
health insurance, the systems for regulation and testing of medications and
medical procedures, the system for training, inspection and professional discipline
of doctors and other medical professionals, public health monitoring and
regulations, as well as coordination of measures taken during public health
emergencies such as epidemics
Social welfare systems, including both government support and private charity for
the poor, for people in distress or victims of abuse
Sports and recreational infrastructure, such as parks, sports facilities, the system
of sports leagues and associations
Business travel and tourism infrastructure, including both man-made and natural
attractions, convention centers, hotels, restaurants and other services that cater
mainly to tourists and business travellers, as well as the systems for informing and
attracting tourists, and travel insurance
relationship does not remain in advanced nations who witness more and more
lower rates on such infrastructure investments.
Nevertheless, infrastructure yields indirect benefits through the supply chain, land
values, small business growth, consumer sales, and social benefits of community
development and access to opportunity. The American Society of Civil Engineers
cite the many transformative projects that have shaped the growth of the United
States including the Transcontinental Railroad that connected major cities from
the Atlantic to Pacific coast; the Panama Canal that revolutionized shipment in
connected the two oceans in the Western hemisphere; the Interstate Highway
System that spawned the mobility of the masses; and still others that include the
Hoover Dam, Trans-Alaskan pipeline, and many bridges (the Golden Gate,
Brooklyn, and Bay Bridge).[34] All these efforts are testimony to the infrastructure
and economic development correlation.
Canal Structures
Transmission Line
Our Founders:
Sri. V. NageswaraRao
Chairman (Emeritus)
Philanthropist - Educationist - Community Leader
Vision:
"To be a leader in the construction industry setting standards in technology, quality &
deliverables while ensuring growth of employees and creating value to share holders.
Core Values:
We actively demonstrate our Core Values at all times because we are a customer and
employee oriented organization delivering maximum value to our stakeholders.
Our Strength:
Dependability is a cherished quality amidst uncertainties. SEW Infrastructure Ltd.,
earned several accolades for competence, dedication and quality.Having gained
experience of handling men and machinery, a fast pace for an impressive growth is now
set.
Specialising in the development of sustainable infrastructure, SEW diversified into allied
strategic business areas, which are wide ranging and impressive by any standards. A total
commitment to quality and time has earned SEW the reputation of a highly dependable
company.
Strong Technical and Management team to identify, develop and execute all types
of infrastructure projects.
Experienced and well equipped state of the art in house Design facility to execute
EPC projects.
OUR COMMITMENT:
Environment Responsibility:
SEW is committed to safeguarding the environment. All our projects, whether it is a
hydroelectric project, a dam, a new road, or a new airport facility, has the potential to
affect people, flora and fauna and the surrounding land. Whether it is cement in the form
of concrete for the structure or fossil fuel in the form of electricity to provide energy,
environmental aspects play an important part in throughout the life cycle of a project.
Our goal always is to protect the environment during a project, and to build in safeguards
that will keep protecting it long after the project is complete.
Operating ecologically and using limited resources sparingly is a matter of course for
SEW. It is our objective to identify the environmental impact of all projects and activities
early on and to keep this to a minimum.
We make sure that every project we undertake meets or exceeds the national and local
governmental regulations for air, water and sound quality. We also take steps to mitigate
potential impact on nature at and near project sites. That includes creating new habitats
for animals and birds by planting trees to replace any that must be removed.
Our environment protection policies are certified to ISO 14001 on all projects across
SEW. These are integrated into the core business processes from site planning to waste
disposal.
Using the ISO 14001 as a guideline we have put in place a series of practices and
procedures to manage our commitment towards prevention of pollution and minimization
of other negative impacts on the environment.
Employee Safety:
At SEW Safety is of paramount importance to us, a value that is fundamental to our
culture. SEW has pursued zero incident programs on it's nationwide projects to heighten
the sense of safety consciousness in every job we do. We strictly enforce the use of all
safety equipment available to every worker on our sites. We have an extensive
deployment of impact, electrical and fire protection systems available to ALL workers on
EVERY project.
We believe that every accident, every injury, no matter how small, is preventable, and we
embed that philosophy into every SEW project through a combination of technical field
procedures and ongoing training programs.
Our dedication to safety helps keep workers safe, and it also pays off for our
stakeholders. Our operating costs go down and productivity goes up because less time is
lost to accidents and results in savings on insurance premiums.
The OHSAS 18001 standard for Occupational Health and Safety is used as a guideline to
develop our health and safety management systems.
SEW implemented a variety of programs and processes, to address the issues around
ergonomics, machine guarding and the use of personal protective equipment to achieve
greater protection and to prevent occupational injury and illness of employees,
contractors and visitors. All employees are committed to identifying and reporting safety
concerns and are involved in implementing solutions for any potential hazard.
We have developed formal safety management systems which are being implemented
across all projects. A task group to look at independent auditing performs periodic safety
inspections to ensure the internal standards on workplace safety are being followed.
Safety audit is a key element of safety management. We subject our safety management
systems to extensive internal audit scrutiny to ensure adherence to our best practices and
standards. All projects maintain programmes for internal audit and inspection, to monitor
implementation of operational controls.
The Project Safety Task Force, chaired by the Managing Director is established to
develop a company policy, review performance, launch new initiatives, and ensure good
practices are shared across all projects nationwide.
SEW has a setup a nationwide helpline in place for reporting of accidents and incidents of
all types (safety, health, environment, quality, security, complaints etc). This also helps
perform a common underlying case analysis and a powerful facility to track actions from
investigations, audit and risk assessment.
We also ask our subcontractors and partners to adopt our commitment to safety and health
for exceptional safety performance, even in hazardous work environments, severe
weather, and remote locations.
SEW provides a blanket insurance cover to all its employees employed on project sites to
cover the risk of personal accidents and emergency medical attention etc.
Safety programs:
Light weight hard hats, eye and face protection, and improved tools and
equipment.
A worker-based safety program that puts the responsibility for changing and
eliminating
Quality Commitment:
Quality objectives are established for all processes of the organization in line with
Quality Policy. Management Review meetings are conducted periodically at various
levels to ensure the effectiveness and adequacy of the Quality Management System.
Learning out of corrective & preventive actions provides opportunity for improvement.
Client Focus:
Processes are established for client communication on suggestions for improvements,
information on status and meetings. Client feedback is obtained once in three months by
the project in-charge. Areas of dissatisfaction / improvements, if any, are discussed in the
site management review meetings and corrective actions taken based on those inputs.
During the project execution, the client interaction is maintained on a continuous basis
and the requirements are met on a regular basis as per the documented Project Quality
Plan.
Quality Policy:
Our Quality Policy, is consistent with the SEW Vision & Core Values:
Shows commitment to comply with the requirements and continually improve the
effectiveness of the Quality Management System.
QUALITY OBJECTIVES:
Procedures are established to specify the methods and criteria for effective
operation, control and necessary resources and information to support the
operation and monitoring of these processes.
1. Procedure for monitoring, measuring and analysing of these processes and
to take necessary actions to achieve planned results and continual
improvement of these processes. It has also maintained relevant
procedures to identify and exercise required control over outsourced
processes, if any
2. The responsibilities and authorities for each function are defined. These
include planning, operations, control, review and monitoring and
corrective / preventive action as appropriate for respective functions.
Effectiveness of the Quality Management System is evaluated through
review meetings at various levels and course correction made accordingly.
The monthly meetings have pre-defined agenda. The information flow is
affected through the minutes of meetings to ensure that both operation and
control of these processes are effective and transparent.
3. Minute planning is done for each project site for the efficient management
of Human Resource, Plant & Machinery and other requirements. Wellestablished systems exist for acquisition, monitoring & control of effective
utilization of the resources against annual targets set.
4. MIS is the tool used in organization for systematic data collection and
reporting. This data is used to analyse, reviewed and monitor region / sites
at different levels and collated by Management committees. Action plans
are
developed
and
communicated
to
concerned
persons
for
During the Financial year 2008-09, about 400 unemployed youth, belonging to the
various parts of the country, have been trained in activities such as plumbing, electrical,
farm work carpentry, masonry with free boarding and lodging facilities on campus.
Higher Education:
Supporting VignanaJyothi an organization promoting the VNRCollege of Engineering &
Technology (named after our founder Sri. Vallurupalli NageswaraRao) among numerous
other schools and colleges.
Business Units:
It is our constant endeavour to upgrade our expertise and provide state of the art
infrastructure to clients. SEW has earned a reputation for its engineering and construction
excellence by providing multi-disciplinary, innovative and cost-effective solutions to
critical projects. Backed by years of excellent construction activity with a large fleet of
modern construction equipment and motivated pool of manpower with proven procedures
and work systems and unique databases, SEW is committed to provide quality
construction solutions to its clients. It has been an exciting journey with several
challenges, new milestones reached, many more peaks to conquer.
SEW has over five decades of rich experience in executing turnkey projects across
diverse fields
Tunnels
Pipelines & Utilities
Ports
Hydel Power
Metro Rail
Commercial Buildings
Highways & Bridges
Oil & Gas
Dams & Barrages
Lift Irrigation
Canals & Aqueducts
Thermal Power
Industrial Structures
Power Transmission
Property Development
BOT Portfolio
Tunnels:
The quantum of tunneling work in India has gone up manifold with the boom in the
development
of
hydroelectric
projects.
Modern methods of tunnel driving have been adopted to achieve high rate of progress on
time bound projects.
In the eighties, progress of 75m per face per month was considered as a high rate of
progress. These days progress of at least 160m per face is the minimum progress desired
to deliver the overall project on time.
SEW employs Tunnel Boring Machines (TBMs) to achieve the high rate of progress
desired in the long reaches.
Another modern tunneling method used is the New Austrian Tunneling Method (NATM)
also known as Sequential Excavation Method (SEM) or Sprayed Concrete Lining (SCL)
often used in shallower tunnels. The surrounding rock or soil formations of the tunnel are
integrated into an overall ring-like support structure. The supporting formation becomes
part of the supporting structure.
SEW has extensive experience in tunneling and underground structures in varied terrain
conditions ranging from largest water transfer conduits to smallest micro tunnels.
In the earlier days, SEW earned a leading reputation in tunnel construction on the
AllainDuhangan Hydro Electric Project and the head regulator and approach channel for
Veligonda Project. More recently SEW has employed NATM at the Joretheng HEP in
Sikkim with tremendous success.
Sports:
India's ports play a vital role in its economic development. Given its vast expanse of
seafronts, over 95% by volume and 70% by value of the country's international trade is
carried on through maritime transport.
India has a total of 187 minor ports and 13 major ports spread across the nine maritime
states.
According to India's central government planning commission, the capacity of Indian
ports will have to be doubled to 2,300 million tonnes over the next five years to handle
the fast growing cargo traffic.
SEW has the asset mobilization potential and unique combination of strengths across all
areas of infrastructure construction to contribute to the nations demands.
Visakhapatnam Port Coal Handling Terminal
Construction of a fully mechanized coal terminal, (EQ-1A) including the berth, Wagon
Tippler, Stacker / Reclaimer, Ship Loader, Conveyor System and Railway works.
This will handle thermal and steam coal in compliance with stringent environmental
regulations
Hydel Power:
In 1887 at Darjeeling, the first hydropower station in India was commissioned. Since
then, there has been a continuous increase in the installed capacity of hydropower
stations. In 1991, Indian government formulated a policy to let private companies own
hydro power projects.
The government has identified hydropower benefits of 38,242MW. The government is
anticipating a hydro capacity addition of 16,553MW of which Central Sector will add
9,685MW, State Sector 3,605MW and Private Sector 3,263MW.
SEW has built many prestigious power projects in the nation such as Mahanadi Hydel
Power Projects, Rani Avanti BaiSagar Power Project, Tawa Hydro-Electric Power Project
and Samarlakota Power House.
Some of the other Hydel Power Projects executed by SEW are the MaheshwarHydel
Power Project, Chuzachen Hydro Electric Project and MyntduLeshka Hydro-Electric
Project.
Metro Rail:
Underground subway systems or metro rail systems, are among the fastest and cheapest
mode of urban transport. As cities grow in size, the number of vehicular trips on road
system goes up. This necessitates a pragmatic policy shift from private modes to public
transport once the level of traffic along any travel corridor in one direction exceeds
20,000 persons per hour. Introduction of a rail based (MRTS) Mass Rapid Transit System
is called for. Mass Rapid Transit System are capital intensive and have long gestation
period.
Commercial Buildings
SEW significantly expanded its capabilities in urban development consulting through a
joint venture partnership. SEW is a multi-disciplinary firm of consulting engineers,
surveyors, planners, landscape architects and urban designers.
SEW has the capability and industry recognised expertise to offer comprehensive services
in the design and documentation of commercial, residential, institutional and industrial
Buildings. Its collaborative team has experience in achieving innovative strategic and
statutory planning and urban design outcomes for a range of key government and private
sector clients. The team aims to provide its clients with creative solutions which are site
specific, achievable and sustainable.
Highways & Bridges:
With the liberalization of the economic policies, the Country is making rapid strides
towards developing the infrastructure facilities everywhere. More thrust is given to bring
the existing National Highways, State Highways and Roads in the rural area to the latest
standards by widening etc., which facilitates the faster movement of traffic more
economically. State of the art machinery is deployed in constructing the Highways at a
faster.
Oil and gas:
SEW has recently decided to foray into the complete spectrum of Oil & Gas
Infrastructure business. We are in the process of building organization and resources to
meet business needs. Aggressively bidding for projects related to Oil & Gas Business
Segments
UP STREAM :
Revamping of Platforms.
MID STREAM :
Cross-country Pipelines
o
Detail engineering
Civil, Mech., Elect. & Instr. work in main line & SV stations
DOWN STREAM :
Storage Tanks
FABRICATION YARD :
SEW proposes to establish a fabrication yard on the east coast for fabrication of offshore
structures and process plant equipment.
Yard on the West Coast is also under consideration. Yard facilities include Jetty, and load
out facilities for heavy structures. Facilities will include: Piping shops, Stores, Testing
Labs, Workshops, Training Centre, and Offices
During the last three-and-a-half decades, the Andhra Pradesh Government has
constructed 1,068 Lift Irrigation Schemes (LIS).
SEW has provided spectrum of pipeline works to its many clients from the heavy
industrial sectors, in India. This array of pipeline works and solutions makes SEW an
ideal one-stop project construction solutions provider. Over the years SEW has executed
scores of challenging and prestigious pipeline works with sheer innovative
brilliance.SEW seamlessly walks the challenging path of engineering excellence with
conviction to deliver only innovative, high quality, reliable and on time pipeline laying
solutions. The company engineers design and develop radical pipeline solutions.
Canals & Aqueducts:
Canals are the most important element of any project providing the umbilical cord
between mother Earth and the farmer. SEW had perfected the art of providing this vital
link between the source and the farmland at a rapid pace with the large Earth moving
machinery and construction equipment at its command. The K.C. Canal Modernisation
work under the package ICB-14 was completed 9 months ahead of schedule.
Power Transmission:
SEW Builds, Owns and Operates the high-voltage electric transmission system that helps
to keep the lights on, business running and communities strong. The company has played
a major role in the complete preparation, analysis, design, construction management and
inspection of energy structures, high voltage transmission lines and distribution systems
across the country. We enjoy an excellent working relationship with the CLIENTs who
has entrusted us with much of the energy infrastructure development of India.
BOT Portfolio:
Infrastructure Sector in India and Role of PPP
As continued growth of an economy depends on availability of quality infrastructure, the
Government of India envisages an investment of over US $ 1 trillion in the infrastructure
segment in the 12th Five Year Plan (2012-2017).
The investments are for sectors like telecommunications, power, water transport, road,
rail, air, water supply and irrigation.
As Government does not have the wherewithal to meet such massive investments to
provide the required infrastructure to sustain the planned growth, Public Private
Partnerships (PPPs) are the preferred mode where the regulatory and administrative
machinery of the Government and the financial resources and execution capabilities of
the private sector are harnessed for achieving the goal. Increasingly, various sectors are
adopting the PPP route to ensure delivery of quality infrastructure within a minimum
possible time frame.
SEW Group in PPP Segment
With a view to leveraging on the impeccable track record of over five decades in
execution of various infrastructure projects on or ahead of schedule and delivery
comparable to the best in the industry in terms of quality standards in the EPC space,
SEW Group has forayed into the BOT ownership space to leverage its execution
expertise and stay on the curve with the growth potential of the sector.
Currently, SEW Group owns 4 highways (totaling 1515 lane Kms) and 1 port terminal
(7.5 MTPA through put) project under transportation segment (with an asset size of
approximately USD 1 billion). Further, the Group also owns about 630 MW of hydro
licenses in North-eastern part of India, which are at various stages of development and
implementation.
2008-2009
2009-2010
2010-2011
2011-2012
18,712
3,126.925
5.984
49,248.32
3,477.41
14.1624
57,374.09
3,848.120
14.910
46,019.51
4,615.21
9.9713
Graphical representation
Interpretation:
From the above graph;
The raw material turnover ratio of the SEW Infrastructure Limited in 20072008 was 5.693, it has been increased to 5.984, in the year2008-2009 and it
has been in increased to 14.1624, in the year 2009-2010.
The raw material turnover ratio had increased to 14.910, in the year 20102011. At present the raw material turnover ratio of the company was 9.9713,
i.e. in the year 2011-2012.
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
600.110
20.974
18,712
961.98
19.452
49,248.32
1358.9850
36.2390
57,374.09
1974.095
29.063
46,019.51
2615.17
17.5971
Graphical representation
Interpretation:
From the above graph;
The stores and spares turn over ratio of the SEW Infrastructure Limited in 20072008 was 20.974, it has been decreased to 19.452, in the year 2008-2009 and it
has been increased to 36.2390, in the year 2009-2010.
The stores and spares turnover ratio had decreased to 29.063, in the year 20102011. At present the stores and spares turnover ratio of the company was 17.5971,
i.e. in the year 2011-2012.
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
463.605
27.150
18,712
5554.910
3.369
49,248.32
10996.090
4.479
57,374.09
7488.550
7.662
46,019.51
7734.060
5.950
Graphical representation
Interpretation:
From the above graph;
s
The Work-in-progress turnover ratio of the SEW Infrastructure Limited in
2007-2008 was 27.150, it has been decreased to 3.369, in the year2008-2009
and it has been increased to 4.479, in the year 2009-2010.
The Work-in-progress turnover ratio had increased to 7.662, in the year 20102011. At present the Work-in-progress turnover ratio of the company was 5.950,
i.e. in the year 2011-2012.
Ratio
12,586.840
3,486.510
3.610
18,712
9,743.370
1.920
49,248.32
13,397
3.6765
57,374.09
13,310.765
4.310
46,019.51
14,964.44
3.0753
Graphical representation
Interpretation:
From the above Graph;
Inventory turnover is a ratio that indicates how many times a company's
inventory is sold and put back over a period.
The Inventory turnover ratio of the SEW Infrastructure Limited in 2007-2008 was
3.610, it has been decreased to 1.920, in the year2008-2009 and it has been
increased to 3.6761, in the year 2009-2010.
The Inventory turnover ratio had increased to 4.310, in the year 2010-2011. At
present the Inventory turnover ratio of the company was 3.0753, i.e. in the year
2011-2012.
2008-2009
2009-2010
2010-2011
2011-2012
Ratio
12,586.840
31,137.49
0.404
18,712
37,833.27
0.495
49,248.32
24,678.91
1.996
57,374.09
42,290.69
1.357
46,019.51
17,045.020
2.700
Graphical representation
Interpretation
From the above Graph;
The Working capital turnover ratio of the SEW Infrastructure Limited in 20072008 was 0.404, it has been increased to 0.495, in the year2008-2009 and it has
been increased to 1.996, in the year 2009-2010.
The Working capital turnover ratio had decreased to 1.357, in the year 20102011. At present the Working capital turnover ratio of the company was 3.0753,
i.e. in the year 2011-2012.
Year/Particular
s
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
Average
inventory
3,486.510
12,586.840
101.104
9,743.370
18,712
190.056
13,397
49,248.32
99.2908
13,310.765
57,374.09
84.6798
14,964.44
46,019.51
118.6892
Graphical representation
Interpretation:
From the above Graph;
The Inventory period ratio of the SEW Infrastructure Limited in 2007-2008 was
101.104, it has been increased to 190.056, in the year2008-2009 and it has been
decreased to 99.2908, in the year 2009-2010.
The Inventory period ratio had decreased to 84.6798, in the year 2010-2011. At
present the Inventory period ratio of the company was 118.6892, i.e. in the year
2011-2012.
Table No: 4. 7
Year/Particular
s
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
Average
inventory
3,486.510
12,586.840
49.859
9,743.370
18,712.00
93.726
13,397
49,248.32
48.9653
13,310.765
57,374.09
41.7599
14,964.44
46,019.51
58.5317
Graphical representation
Interpretation:
From the above Graph;
The Days of inventory holding ratio of the SEW Infrastructure Limited in 20072008 was 49.859, it has been increased to 93.726, in the year2008-2009 and it has
been decreased to 48.9653, in the year 2009-2010.
The Days of inventory holding ratio had decreased to 41.7599, in the year 20102011. At present the Days of inventory holding ratio of the company was 58.5317,
i.e. in the year 2011-2012.
Ratio
18,712
73,426.12
0.2548
49,248.32
94,902.93
0.5189
57,374.09
1,28,047.06
0.4481
46,019.51
1,77,056.39
0.2599
Graphical representation
0.2222
Interpretation:
From the above Graph;
The Current assets turnover ratio of the SEW Infrastructure Limited in 2007-2008
was 0.2222, it has been increased to 0.2548, in the year2008-2009 and it has been
increased to 0.5189, in the year 2009-2010.
The Current assets turnover ratio had decreased to 0.4481, in the year 2010-2011.
At present the Current assets turnover ratio of the company was 0.2599, i.e. in the
year 2011-2012.
2008-2009
2009-2010
2010-2011
2011-2012
Ratio
12,586.840
25,499.53
0.4936
18,712
35,592.85
0.5257
49,248.32
65,27,8.93
0.7544
57,374.09
85,756.37
0.6690
46,019.51
82,706.40
0.5564
Graphical representation
Interpretation:
From the above Graph;
The Current liabilities turnover ratio of the SEW Infrastructure Limited in 20072008 was 0.4936, it has been increased to 0.5257, in the year2008-2009 and it has
been increased to 0.7544, in the year 2009-2010.
The Current liabilities turnover ratio had decreased to 0.6690, in the year 20102011. At present the Current liabilities turnover ratio of the company was 0.5564,
i.e. in the year 2011-2012.
Credit
purchases
Accounts
payable
Ratio
7,445.72
1,501.23
4.9597
8,701.73
1,913.200
4.5483
7,198.31
2,494.858
2.8853
11,532.98
3,261.937
3.5356
6,730.60
3,324.002
2.0248
Graphical representation
Interpretation:
From the above graph;
The Creditors turnover ratio of the SEW Infrastructure Limited in 2007-2008 was
4.9597, it has been decreased to 4.5483, in the year2008-2009 and it has been
decreased to 2.8853, in the year 2009-2010.
The Creditors turnover ratio had increased to 3.5356, in the year 2010-2011. At
present the Creditors turnover ratio of the company was 2.0246, i.e. in the year
2011-2012.
Accounts
payable
Credit
purchases
Days
1,501.23
7,445.72
73.5840
1,913.200
8,701.73
80.2505
2,494.858
7,198.31
126.5051
3,261.937
11,532.98
103.2350
3,324.002
6,730.60
180.2604
Graphical representation
Interpretation:
From the above graph;
The Creditors conversion period of the SEW Infrastructure Limited in 2007-2008
was 73.5840, it has been increased to 80.2505, in the year2008-2009 and it has
been increased to 126.5051, in the year 2009-2010.
The Creditors conversion period had decreased to 103.2350, in the year 20102011. At present the Creditors conversion period of the company was 180.2604,
i.e. in the year 2011-2012.
FINDINGS:
SUGGESTIONS:
There is no particular method has been followed for valuing the particular type of
inventories.
The company has to introduce some of the major inventory classification methods
like XYZ analysis and FSN analysis for better control of inventories.
The valuation of inventories is entirely based on the both manual and computer
valuation
Most of the times inventory is not sufficient at the time of production. The company
has to maintain adequate level of inventory.
Bin cards are maintained in APHMEL to know the location of stock, its current stock
available, the issues of receipts of materials etc.
The company should introduce stock verification system for all the materials.
The company should introduce some of the major inventory FSN analysis for better
control of the inventory.
As a whole the inventory management in the company is good. It proves that the
stores department and production department is performing efficiently in the
organization.
CONCLUSION:
BIBILIOGRAPHY
Books:
Finance management
Finance management
Finance management
Finance management
(Theory & Practice)
Financial Accounting
Production management
R.K.Sharma&K.Gupta
Khan& Jain
I.M.PANDY
Prasanna Chandra
S.P.JAIN & K.L.NARANG
Aswatappa
Journals:
Annual Audit Reports SEW infrastructure Limited.
Web Sites:
www.sewinfrastructure.com
www.officeonline sewinfrastructure.com
www.inventory management.com
www.inventory control.com
www.inventory methods.com