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A PROJECT ON
HINDUSTAN PENCILS
MASTER OF COMMERCE PART I ( SEMESTER-I )
2014-2015
SUBMITTED BY
Mr. PRADEEP VASUDEV SEVAK
PROJECT GUIDE
Mr. Sabestian Rebello
DECLARATION
I ,Mr. Pradeep Vasudev Sevak student of M.COM in Advance
Accountancy ( Semester-I ) of Shankar Narayan College Of Art
& Commerce hereby declare that
I have completed this project on HINDUSTAN PENCILS
in the academic year 2014-2015.
I declared that the project report is my original work and it has not
been
submitted
by
me
in
university/institution/statutory
part
body
or
for
full
the
to
any
award
of
other
any
degree/diploma/certificate.
Name of Candidate : Mr. Pradeep Vasudev Sevak
Place
Bhayander
Sign:
Date:16-NOV-2014
CERTIFICATE
I certify that the above declaration is true to the best of our
knowledge and belief.
Project Guide
Co-ordinator
Date:
Date:
16-NOV-2014
CERTIFICATE
This is to certify that Mr. Pradeep Vasudev Sevak has completed
the project titled A PROFILE ON HINDUSTAN PENCILS
under the guidance of Prof. Sabestian Rebello in practical
fulfillment of the requirement for the award of Master of
Commerce Part - I studies for academic period 2014-2015
PROJECTGUIDE
PRINCIPAL
Dr.V.N. Yadav
EXTERNAL GUIDE
CO-ORDINATOR
16-NOV-2014
PLACE :
BHAYANDER
ACKNOWLEDGEMENT
CONTENT
INDUSTRY ANALYSIS
HINDUSTAN PENCIL LTD.
PROFILE
OBJECTIVE
MISSION
QUALITY POLICY
ENVIRONMENTAL POLICY
MANUFACTURING
DISTRIBUTION
PRODUCTS
Executive summary
INDUSTRY ANALYSIS
21st century perspective
The world has changed, it is not the same as it was 15 years back,
every thing has been computerised, new technologies comes every
day. From dawn to dusk we use a lot of technical products. The
standard of living of the people has improved. The lifestyle of people
has changed. So has the way of recording things. In this modern era
people use computer to record information, transaction and any
communication. Electronic mail has replaced the normal written
mails. Manual recording of transactions has been replaced by
computerised transaction.
But still writing letters and notes retain popularity. A kid in
school starts writing with the pencil and continues to use it through
out his life. The usage of pencils has not come down even in this
technical era. So even when all the experts doubt the future of the
pencil industry, the emotional Indian consumer extends the life of
pencil industry. The atmosphere in the stationery market is still the
same during the June -July season when the schools re-open and the
kids are hunting these shops for new pencils and pens.
An article titled Bunder Street's the place for affordable
stationery written by Meera Srinivasan published in The Hindu
dated 23/3/2006 supports the above point.
Bunder Street looks ready for war. Not one that uses knives or
guns but pens and pencils.
With hundreds of new varieties of stationery items stocked,
Bunder Street in Parrys Corner is all set for the upcoming academic
year. There are nearly 500 stationery shops in the lane off the Flower
Bazaar police station. Fountain pens, ballpoint pens, pencils, erasers,
sharpeners, rulers, notebooks, files, CD cases, pencil boxes,
geometry boxes, colour pencils, paints, correction pens, adhesives
and charts are but a few items that catch one's eye in a glance.
PENCIL a low involvement product which seems to be really
simple is not as simple as it looks in manufacturing it. An ordinary
lead pencil requires 40 different raw materials the main being wood
and lead.
Pencils Manufacture
The 'pencil', derived from the Latin word penicillum,
seems humble enough to be hurriedly put together in one's backyard.
In this aspect, the simplicity of the pencil is truly misleading. The
common pencil uses about 40 different raw materials, the basic ones
being wood, graphite and clay. The indigenously grown wood
brought specifically from the state of Jammu and Kashmir, is first cut
into slats that are as long as but only half the width of the pencil. The
slats are then subjected to wood staining and grooves are cut into the
slats.
lacquered
and
printed
as
per
requirement.
and
0.12
million
scales
daily.
HPs obsession with quality has driven them to build their own
manufacturing infrastructure. Every little component like pencil
lacquer, Sharpener blade & screw that goes into the making of their
products, are produced in-house. HPs brands 'Apsara' and 'Nataraj'
have emerged as household names. In other words, Hindustan Pencils
Ltd has come to personally quality
A competitive
at
Objectives
to find out the influence of CSR in building the brand image of
Hindustan pencils ltd.
to find out the consumers perception about CSR.
to find out the consumers awareness about HPs CSR.
to find out the influence of CSR in buying behaviour
Mission
Delighting consumers with globally recognised stationary.
QualityPolicy
Hindustan Pencils is committed to the manufacture of market
quality products of international standards at competitive prices, in
the stationery field. Constant effort is made by the company to meet
international safety standards and to prevent degradation of the
environment.
Environment Policy
Constant effort is made by the company in improving processes
and maximizing utilization of inputs to prevent degradation of
environment. All ingredients used by the company are non-toxic in
nature. Wood being one of the main inputs for pencils, efforts are
made to develop plantations to ensure renewal of this precious
natural resource. Research & Development efforts are also done to
switch over to eco-friendly water based lacquers and PVC-free
formulations.
11
Manufacturing
Given that enduring reliability is the hallmark of HPs products,
understandably, they are manufactured using the most stringent
quality controls backed by years of research and development. The 7
factories of HP at 5 locations in India employ the latest in technology
and the best of raw materials to grant to its products the quality, so
ingrained in its product development philosophy. Besides developing
the machines for manufacture indigenously, every component that
goes into the making are produced in-house by Hindustan Pencils.
Their concern for the environment has led them to grow their
own trees to satisfy their requirements for wood, an essential
ingredient in pencil manufacture. This practice in turn ensures an
uninterrupted supply of wood of consistent quality from plantations.
All said and done, the outcome of their manufacturing process are
products that offer the customers excellent "value for money".
The process results in bonded lead pencils of high calibre, about
18 cms long that can draw a line 55 kms long and on an average
write about 45,000 words. The pencils that write smooth and dark are
tipped at one end to indicate the end that has to be sharpened,
ensuring maximum utilization. Every stage of the process is executed
with maximum controls and quality checks to ensure that the product
is truly world-class.
12
Distribution
Hindustan Pencils large manufacturing capacity at 5 locations
across India is backed by an impressive distribution network, which
ensures that their products find their way to every household in
India. 25 depots/C & F agents, 2,500 distributors, 1, 50,000 retail
outlets and a formidable field force complete the supply chain. The
depots are spread across the length and breadth of the country and are
located at Ahmedabad, Sewree, Bhivandi, Nagpur, Indore, Raipur,
Delhi, Gaziabad, Jaipur, Kanpur, Pabhat, Ranchi, Cuttak, Gauhati,
Chandigarh, Dehradun, and Goa.
Global Sales
HPs commitment to quality, competitive pricing and its
enormous manufacturing capacities have carried their products well
beyond Indian shores. At present, they export to over 32 countries
which includes Bahrain, Bangladesh, Belgium, Botswana, Brazil,
Burkina Faso, Canada, Chile, Costa Rica, Cyprus, Dominican
Republic, Dakar, Egypt, El Salvador, Gabon, Gambia, Ghana,
Guinea, Guatemala, Hungary, Honduras, Italy, Iran, Israel, Ivory
Coast, Jamaica, Jordan, Kenya, Kuwait, Mali, Mauritius, Mexico,
Morocco, Myanmar, Nicaragua, Niger, Nigeria, Oman, Panama,
Peru, Philippines, Portugal, Puerto Rico, Saudi Arabia, Senegal,
South Africa, Spain, Sri Lanka, Suriname, Tanzania, Thailand, Togo,
Turkey, U A E, U K, U S A, Venezuela, Vietnam, West Indies.
13
Products
Hindustan Pencils has two big brands Apsara and Nataraj and
they have come up with a new brand Colorama which has been
developed after a lot of research with a view to promote creativity
among kids. Under each brand they have
Senior officials of
Apsara
Black lead pencils are available in a number of types under
Apsara brand name. Each one is for a different use example the
steno pencil is for distinctive hand writing, in the same way they
have differentiated between different pencils under the same brand
Apsara
They are as follows Writing Pencils
>> 01G96 Apsara Triangle Metallic Pencils
>> 01G37 Apsara Twinkle 509 Extra Dark
>> 01G16 Apsara 510 Printed Pencils
>> 01G03 Apsara Platinum Pencils
>> 01G01 Apsara Beauty Pencils
>> 01G02 Apsara Gold Pencils
>> 01G11 Apsara Natural Pencils
>> 01G10 Apsara Matt Magic Pencils
>> 01G33 Apsara Twinkle 507 Pencils
>> 01G15 Apsara Triangle Natural Pencils
>> 01G15 Apsara Triangle Yellow Pencils
>> FX 01G21 Apsara Yellow Pencils
>> 01F01 Apsara Steno Pencils
15
Nataraj
Writing pencils
Colour Pencils
Checking Pencils
In Nataraj under writing pencils they have a number of different
products.
>> 01L01 Nataraj 621 Pencils
>> 01L62 Nataraj Marble Pencils
>> 01L61 Nataraj Metallic Pencils
>> 01L33 Nataraj Picture Pencils
>> 01L03 Nataraj Yellow Pencils
>> 01L05 Nataraj Monday to Friday Pencils
>> 01L17 Nataraj Fluorescent Pencils
Each and every pencil above mentioned is classified from one
another for example Monday to Friday pencil is for, For special
writing each day at school and picture pencil is for, For clear and
smooth writing
16
17
ecological
balance.
21
Awards
Three gold medals, six silver medals and nine bronze
medals were awarded under each level apart from 19 consolation
prizes. While B. Rajkumar, a Fine Arts student at Potti Sree Ramulu
Telugu University bagged the gold medal under the degree students'
category, K.M. Praveena of K.V. One Public School, Uppal and K.
Mamatha of Vardhana School bagged the level one and level two
gold medals respectively. (source The Hindu)
22
MANUFACTURING PROCESS
INTRODUCTION :
23
MARKET POTENTIAL :
1.
2.
3.
4.
5.
6.
7.
8.
Our story of how cedar pencils are made is a celebration of timehonored traditions married to modern manufacturing facilities. The
journey begins at a sawmill, where Incense-cedar logs are cut into
lumber called Pencil Stock or Pencil Squares. This lumber
product is then dried in a dry kiln to reach a uniform moisture content
before being shipped to the Slat factory.
27
8. Individual pencils cut from the sandwich are ready for further
processing. Any pencils with defects, such as uncentered leads
or chipped wood, are discarded at this point.
28
1.
29
2.
Quality Standard :
It should conform ASTM D 4236.
3.
4.
FINANCIAL ASPECTS :
1.
Fixed Capital :
Land
Building
Work shed
Raw material stores
Finished goods
Office
Water position and supply lining arrangement
Boundary wall
3650 sq.ft
Rs.1,82,000/-
17x42
16 x 10
16 x 10
16 x 10
L.S.
Rs.1,40,000/Rs.28,000/Rs.28,000/Rs.72,000/Rs.20,000/Rs.75,000/Rs.3,65,000/-
TOTAL :
30
Qty.
Price [Rs.]
1 no.
20,000/-
1 no.
15,000/-
3.
4.
1 no.
1 no.
20,000/50,000/-
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
50 nos.
2 nos.
1 no.
20,000/40,000/1,00,000/-
2 nos.
30,000/-
1 no.
20,000/-
75,600/-
POLLUTION CONTROL
Pollution control equipment complete with 1 no.
ducts, blowers and filter bag system
Laboratory equipment
L.S.
Add. Installation & erection @ 15% of
L.S.
Sl.No. 1 to 11
Scooter (for marketing)
--Office furniture & Equipment
L.S.
Fire fighting equipment
L.S.
Generator 5 KVA
Weighing Scale
Show room cum distributor center at prime 2 nos.
area
TOTAL
:
31
50,000/50,000/50,000/35,000/25,000/5,000/30,000/5,000/3,00,000/Rs.5,50,000/
-
1.
2.
3.
4.
Rs.20,000/-
Rs.5,000/Rs.20,000/Rs.15,000/Rs.60,000/-
Land
Building
Machinery Equipment
Other general fixed assets
Pre-operative expenses
TOTAL
Rs.1,82,000/Rs.3,65,000/Rs.3,90,600/Rs.5,50,000/Rs.60,000/: Rs.15,47,600/-
32
Personnel :
Administration :
Description
General Manager
Clerk cum typist
Peon
Watchman
Sweeper
TOTAL
15% for service benefits
TOTAL
B.
Sl.No
.
1.
2.
3.
4.
5.
6.
7.
Production :
Description
Supervisor
Ball mill operator
Semi skilled labour for mixing area
Semi skilled labour for extrusion area
Semi skilled labour for drying
Skilled labour for firing articles
Semi skilled labour for wax bath
operation and sorting area
TOTAL
15% for service benefits
TOTAL
C.
Selling & Distribution :
Sl.No Description
.
1.
Sales Manager
2.
Sales Representative
3.
Sales Clerk
TOTAL
15% for service benefits
TOTAL
No.
Total (Rs.)
1
1
1
2
1
:
:
:
10,000/3,000/1,200/2,400/1,200/Rs.17,800/Rs.2,670/Rs.20,470/-
No.
Total (Rs.)
1
2
4
2
2
1
2
5,000/6,000/4,800/2,400/2,400/3,000/2,400/-
:
:
:
Rs.26,000/Rs.3,900/Rs.29,900/-
No.
Total (Rs.)
1
2
1
:
:
:
9,000/10,000/3,000/Rs.22,000/Rs.3,300
Rs.25,300/-
Administration
Production
Selling & Distribution
TOTAL
II.
Rs.20,470/Rs.29,900/Rs.25,300/Rs.75,670/-
Sl.No Description
.
1.
2.
3.
4.
5.
6.
7.
Graphite
Clay
Grey
sulphide
Lamp black
Wax
Antimony
Qty. per
annum/
Kg.
2200
2000
500
150
40 Kg.
Rate
[Rs.]/unit
Value [Rs.]
173/Kg.
3/Kg.
400/Kg.
3,80,600/6,000/2,00,000/-
20/Kg.
20/Kg.
TOTAL
:
Rs. 1 per
Pc.
Rs. 3/- Pkt.
TOTAL :
Raw materials & consumables for one month
III.
3,000/8,000/Rs.5,97,600/60,00,000/9,00,000/Rs.74,97,600/Rs.3,74,880/-
Extruder
Furnace
Other
30 KW x 6 Hrs.
47 KW x 25 Hrs.
10 KW x 10 Hrs.
TOTAL
180 units
1175 units
100 units
1455 units
Rs.1,81,875/Rs.3,673/Rs.200/Rs.1,85,748/-
Cost [Rs.]
200/800/2,000/450/2,500/150/400/450/700/600/800/800/4,000/3,000/2,100/Rs.18,950/-
Rs.75,670/Rs.7,49,760/Rs.1,85,748/Rs.18,950/: Rs.10,30,128/-
Rs.15,47,600/Rs.10,30,128/Rs.25,77,728/-
FINANCIAL ANALYSIS :
1.
Cost of Production
i.
Rs.1,23,61,536/
ii.
iii.
vii.
v.
Rs.39,060/Rs.55,000/Rs.36,500/Rs.3,86,659/-
TOTAL
2.
Rs.1,28,78,755/
-
Rs.1,39,80,000/-
3.
Rs.11,01,245/-
4.
Net Profit
Rs.5,52,122/-
5.
3.95%
6.
Rate Of Return :
43%
7.
Fixed Cost :
Depreciation on plant & machinery
Depreciation on General fixed assets
Rs.39,060/Rs.55,000/-
Depreciation on building
Rs.36,500/-
Rs.3,86,659/-
40% of salary
20% of other expenses
25% of power expenses
TOTAL
Rs.3,63,216/Rs.45,480/Rs.5,45,625/: Rs.14,71,540/-
Break-Even-Point :
Fixed Cost x 100
14,71,540 x 100
=
= 57%
14,71,540 + 11,01,245
CONCLUSION
BIBLIOGRAPHY
Web sites-
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