CHAPTER II

1.1 INDUSTRY PROFILE

Paper industry plays an important role in the industries development in India.

Paper industry occupies a large percentage in India market. It provides wide
employment opportunities. Paper industry not only plays vital role in India
economy but also enhances our product values in world market. From the time,
human life stared in this world, people realized the need for communication and
they wanted to record certain thing for future generation. Initially rocks and
trees were used to carve the message. After that palm leave were used for
communication process. Then mental sheet with sharp tools for writing were
used. In olden days the kings used silicon cloth to write important documents

Origin of the paper

Paper has a long history, beginning with the ancient Egyptians and continuing
to the present day. For thousands of years, hand-made methods dominated and
then, during the 19thcentury, paper production became industrialized. Originally
intended purely for writing and printing purposes, a wide variety of paper
grades and uses are now available to the consumer. Of all the writing and
drawing materials that people have employed down the ages, paper is the most
widely used around the world. Its name derives from papyrus the material used
by the ancient Egyptians, Greeks and Romans. Papyrus, however, is only one of
the predecessors of paper that together are known by the generic term Tapa
and are mostly made from the inner bark of paper mulberry, Fig and Da Tapa
has been found extensively in nearly all cultures along the Equatorial belt and is
made by what is possibly the oldest papermaking technique one still
practiced in some parts of the Himalayas and South East Asia. Indeed, recent
archaeological excavations in China have revealed some of the oldest Tapa
paper ever found which shows that paper was being produced in China before
western records began.

The tapa technique involves cooked baste, which is flattened with a wooden
hammer to form a thin, fibrous layer and then dissolved in a vat with water to
make a pulp. A screen consisting of a wooden frame with a fabric base is then
laid in a puddle or big basin and floats with the fabric just under the surface of
the water. The papermaker then pours the quantity of pulp needed to make one
sheet into this floating mould and spreads it evenly, by hand, across the
surface. The screen is then carefully lifted out of the water, allowed to drain off
and a sheet of paper forms on the wire. Once the water has dropped off, the
screen is placed in the sun or near a fire to dry. When dry, the sheet easily peels
off and, apart from possible smoothing, requires no further treatment. This
technique has two basic drawbacks. Firstly, a separate screen is needed for each
new sheet, and is only available for use again after the last sheet has dried. And
secondly, an increase in production can soon lead to a shortage of raw material,
since fresh baste is not always available everywhere in the required quantity.
The fibres normally used for textiles, like flax and hemp, also served as
substitutes for baste. In later times, the fabric was replaced by fine bamboo

sticks, which freed the papermaker of the need to let the paper dry naturally in
the mould, since the poured or ladled sheet could be couched off.

Paper plays a key role in communication and as a packaging material. Demand

for paper is closely linked to prevalent economic conditions. Strong economic
growth boosts demand for paper and vice versa. In India, the first paper mill
was established in 1867. Raw materials used for the production of paper were
rags and wastepaper. Commercial production of paper was started in 1882, and
raw materials used were again non-wood fibres, that is, eulaliopsis binata and
sacharum bengalense. Development of the fractional process of pulping bamboo
at the Forest Research Institute, Dehra Dun, during 1922-24 provided an
impetus to the pulp and paper industry in the country, and bamboo became the
main raw material for making various grades of paper. Turing establishments
cut and coat paper and foil. Stationery product manufacturing establishments
make a variety of paper products used for writing, filing, and similar
applications. Other converted paper product manufacturing includes, in
particular, the conversion of sanitary paper stock into such things as tissue paper
and disposable diapers.

Industries in the Paper Manufacturing subsector make pulp, paper, or converted

paper products. The manufacturing of these products is grouped together
because they constitute a series of vertically connected processes. More than
one is often carried out in a single establishment.

There are essentially three activities. The manufacturing of pulp involves

separating the cellulose Fibres from other impurities in wood or used paper.
The manufacturing of paper involves matting these fibres into a sheet.
Converted paper products are made from paper and other materials by various
cutting and shaping techniques and include coating and laminating activities.
The Paper Manufacturing subsector is subdivided into two industry groups, the
first for the manufacturing of pulp and paper and the sec and for the
manufacturing of converted paper products. Paper making is treated as the core
activity of the subsector. Therefore, any establishment that makes paper
(including paperboard), Either alone or in combination with pulp manufacturing
or paper converting, is classified as a paper or paperboard mill. Establishments
that make pulp without making paper are classified as pulp mills. Pulp mills,
paper mills and paperboard mills comprise the first industry group.

India is not just the second most populous market for paper in the world. It is
also the most demanding. Indian paper industry not only serves a public utility
but fulfils a critical national requirement. It possesses an annual production
capacity of five million tones. It generates an annual turnover of approximately
120 billion. It directly and indirectly employs nearly 1.3 million people.

The Indian paper industry has been historically divided on a three dimensional
matrix identified by size, grades manufactured and raw material utilized.
Generally, tariff rates have protected smaller units utilizing unconventional
raw material. Over the years, the growth of various segments, investments
levels in specific segments, technological changes, industry fragmentation and
intensity of competition have been significantly influenced by the Government
tariff policy. The present Excise duty on Paper is 12 %.

The Government of India from time to time has given some benefits to small
industries in order to protect them i.e. the first 3500 tons produced by a mill is
chargeable only @ 8 % and thereafter it is @ 12 %. The three main grades of
paper manufactured in India are:-

1. Newsprint

2. Writing and printing.

3. Industrial Variety (Craft paper and Duplex Board)

Over 550 players currently populate the industry and the estimated capacity is
about 7.00 million Metric Tons Per Annum (MTPA). Fragmentation is severe in
the industrial (packaging) grades, which rely on unconventional raw
material such as waste paper and partly agro residues. This division generally
comprises of units with an average size of about 10000 MTPA and contributes
to 45% of the output of paper and paper boards in the country. Although the
other divisions in the Indian paper industry are also fragmented by international
standards, the degree of fragmentation is less severe.
Newsprint till about 1995, was the sole preserve of large public sector units
and was well protected by high import tariff barriers. Nevertheless, imports
contributed to about 50% of the domestic consumption. Since then, new
domestic capacity with private investment has been allowed to be created. This
growth has relied namely on De-inked waste paper as a source of raw material.
Currently import duty on newsprint is about 5% and domestic manufacture of
newsprint is exempted from excise duty.

Technology and resources

The processes used to produce pulp and to dry paper are the major energy
consumers in the industry. The main production facilities are either pulp mills or
integrated paper and pulp mills. Integrated mills have better energy efficiency.

Kraft pulping is the most extensively used chemical pulping process. It

produces high-quality fibers for higher paper grades. However, it requires large
amounts of heat energy and has a low fiber yield. Kraft mills are able to meet
most or all of their energy needs from by-products (i.e. black liquor) and they
can even be a net exporter of energy. Similarly, sulfite pulping, which is used
for speciality papers, has a high energy consumption but can self-generate a
large part of a mill's energy needs from by-products.

Mechanical pulping produces weaker fibers but it has a high yield, giving it a
lower specific final energy demand. Higher efficiencies are enabled by
applications such as thermo-mechanical pulping, where heat is recovered at
diffent grades. However, as electricity is the main energy used, this technology
may have high primary energy demand and CO2 emissions.

Pulp production from recovered fibers requires substantially less energy

compared to virgin pulp (the BAT values for recovered fiber is 0.7-3 GJ/t
compared to around 14.3 GJ/t for Kraft pulping).1 It is a promising option for
reducing energy consumption and CO2 emissions, with estimates projected to be
as high as 35%. However, the availability of recovered paper is sometimes
limited and resolving this issue will require changes to other parts of the paper
production lifecycle.

The amount of energy used by paper machines is generally dependent on the

pulp quality and paper grade, and it can show big variations. Integrated mills
can achieve higher energy efficiency by eliminating intermediate pulp drying
and using better processes.

Application of Combined Heat and Power (CHP) can significantly enhance the
energy efficiency of pulp and paper industry. The CHP potential in the paper
and pulp industry is estimated to be in the range of 0.3-0.6 EJ/year. Typically,
the introduction of CHP can result in fuel savings of about 10-20% and energy
savings of 30% compared to traditional technologies.

The IEA believes black-liquor gasification and bio-refinery concepts, advanced

paper-drying techniques, increased paper recycling, and carbon capture and
storage will play a key role in reducing energy consumption and GHG
emissions in industry.

Global & Indian Demand & Supply

Global Demand

Globally demand for Paper and Paperboard is likely to keep its growth
pace intact
Writing and printing paper demand to be on slower side with many firms
in west going paperless.
Robust demand for paper by Chinese household would to keep Asian
demand on high note.
Packaging and container board to be the major demand segment
Rising concern for environment with many firms discouraging use of
paper to impede demand growth
 Persistent concern over economic recovery and monetary tightening steps
taken by Chinese Govt. to impact demand.
Revival in industrial production across the world and increase in global
trade stands crucial for incremental demand.
Increasing use of packaged goods to further boost demand sentiments
Persistent concern over economic recovery and monetary tightening steps
taken by Chinese Govt. to impact demand
Revival in industrial production across the world and increase in global
trade stands crucial for incremental demand.
Current signals of improving industrial output and trade in certain pockets
provide encouraging scenario for industrial papers in the coming year

Global Supply

Economic downturn witnessed during 2008-09 resulted in closure of

large number of paper mills in western region with the mills unable to
absorb huge losses incurred due to demand destruction
With global economy mainly Asia and US giving signals of revival and
the same expected to start showing better results moving into 2012, the
same shall prompt some of the companies to increase their runs and may
lead to reopening of few closed plants
Limited availability of virgin pulp to prompt mills to put up capacities
based on Agro-residues and waste papers
Closure of many small mills in Europe and North America to limit the
global supply in the coming year
While start-up in South America and Asia add to the supply basket, not
much of it is for industrial paper, which shall hinder the supply growth
of packaging papers
With global economy giving signals of revival, the same would prompt
some of the companies to increase their runs and may lead to reopening
of few closed plants
Capacity closure in Europe and North America to limit the global supply
in the coming year
 With global economy giving signals of revival, the same would prompt
some of the companies to increase their runs and may lead to reopening
of few closed plants.

India Demand

Strong emphasis on literacy, increase in per-capita income and increasing

use of photocopiers and printers shall keep demand on high note in the
region.
High economic growth propelling demand for consumer goods, thus
stimulating demand for packaging paper
Expectation of robust performance by Indian industrial sector to propel
demand for duplex boards
Higher export growth and rising demand for high quality packaging to
keep Indian market in tandem
Increased global trade to spill-over onto the Indian export scenario and
enhanced exports (of products) to fare well for Indian demand scenario
Better quality packaging of FMCG, rising health care spends and over-the
counter medicines and increasing preference for ready-to-eat foods are
the key demand drivers for paperboard
Growing number of Export oriented industries
Strong demographic factors like population growth and increase in
literacy levels

Indian Supply

Obsolescence of technology and shortage of raw material being a major

hindrance at supply side
Lack of government initiatives to provide waste land for plantation
With capacity utilization in the region reaching to 93 percent, new
capacity needs to be added to cater the growing demand
 Obsolescence of technology and shortage of raw material being a major
hindrance at supply side
Lack of government initiatives to provide waste land for plantation
Not much new capacity coming on-stream for Kraft paper A long term
issues yet to be tackled
Obsolescence of technology and shortage of raw material being a major
hindrance at supply side.
Government ignoring industry demand for interest subsidy under
Technology Upgradation Fund (TUF) Scheme
Not much new capacity coming on-stream for Duplex board A long
term issues yet to be tackled

Government Regulations, Permission & Taxes

1. Central Excise:

Central Excise is levied @8% for the first 3500 MT production and thereafter
@12% on the value of the invoice. The Company is availing permitted Modvat
benefits as per Central Excise regulations. For import duty paid on waste paper
procured from overseas the Company is entitled to adjust the entire duty paid
component as that of Modvat credits .

2. VAT (Value Added Tax):

VAT replaces the existing multipoint taxes levied by various states with effect
from April 05. As that of other industries, the paper trade is also covered under
VAT for domestic sales done in the state of Kerala. However for interstate sales
CST is continued to be levied as per existing Government regulations.

3. Service Tax:

Being classified as a manufacturing industry, the industry even for Job Work on
conversion basis will not be subjected to Service Tax requirements. A recent
notification from Central Government also confirms such a stand.
4. Factory Licenses:

All the licenses required under Municipality Act, Factories Act are obtained and
duly renewed.

5. Pollution Control:

Necessary permission under effluent discharge Act is obtained and the facilities
required to maintain the permission are in place.

Mjor players in indi:

2. 2 COMPANY PROFILE

To be the market leader in the manufacture of world class eco-friendly papers

by adopting innovative technologies for sustainable development.

TNPL was formed by the Government of Tamil Nadu in April 1979. The
primary objective of the company is to produce Newsprint, Printing and Writing
paper using biogases a sugarcane residue as the primary raw material. The
registered office of the company is situated at Gundy, Chennai.
The products are being marketed throughout the country and also being
exported to 20 countries around the world. The factory is situated at
kagithapuram in Karur district of Tamilnadu. The initial capacity of the plant
was 90,000 TPA of Newsprint, Printing and writing paper, which commenced
production in the year 1984. The capacity was doubled to 1, 80,000 TPA in
January 1996 after implementation of the first project. Recently the capacity has
been further enhanced to 2, 30,000 TPA in April 2003 through up gradation of
both the paper machines.

The largest production capacity in India at a single location and paper machines
with built in flexibility for manufacturing Newsprint, Printing and writing
papers in the same machine.

TNPL has the unique arrangement with the sugar mills for sourcing the raw
material in the form of exchange of steam/fuel for baggasse. TNPL is
committed to manufacture and supply eco-friendly papers to customers
satisfaction with the emphasis on continual improvements in its quality
management systems. Meeting customers requirement with eco-friendly raw
materials (viz.., Baggasse) for paper making through continuous process
improvements is TNPLs Quality policy, Quality standardization without
compromise on environment is being accomplished with online quality control
at various stages of production. Despite opening up of Indian markets for
imports, TNPL has been consistently recording increasing in year by year,
which demonstrates the companys commitment to Quality. Direct interaction
with customers through customer service cell has helped the company in
meeting the Customer Satisfaction Index (CSI) ranging from 7.01 to 7.50.
Customized products are also being manufactured by TNPL to meet the
customer delight.
The Online Integrated Information system (OIIS) a mini ERP package
developed by CMC ltd.., for TNPL integrates the flow of information from all
the section of the company covering Production, Materials, finance and
Marketing etc.., Thus OIIS has greatly improved information for faster and
timely decision making for assured product quality. The automated process
control facilities ensure complaint free products at various stages upto the final
packing and dispatch.

By using bagasse as the primary raw material instead of wood. TNPL is saving
deforestation of about 30,000 acres of forestland every year. Due to the usage of
bagasse the chemical consumption in the pulp bleaching process is lower.
TNPLs effluents completely comply with the norms set by Tamil Nadu
Pollution Control Board. TNPL is adopting activated sludge treatment system.
Further the treated effluent water is being used to irrigate 1500 acres of land
around the factory. The farmers are cultivating cash crops such as sugarcane,
groundnut etc.., and using TNPL effluent water. TNPL has obtained the
prestigious ISO 14001 certificates from RWTUV, Germany for successfully
establishing and applying environmental management system for development
manufacture and supply of paper.

TNPL has installed a bio methanation plant to generate methane gas from the
effluent water and use it as a field as substitute for furnace oil in the lime kilin
saving 10 KL of furnace oil every day.

THE VISION: To be the market leader in the manufacture of eco-friendly world

class papers adopting innovative technologies.

THE MISSION:

1. Attain leadership in paper industry.

2. Promote the usage of Biogases in the manufacturer of Newsprint and Printing
and Writing paper. 3. Minimize environmental impact and become an
environment friendly organization.

TNPL COMMITMENTS ON QUALITY

Company committed to satisfy customers for the product, TNPL develop,

manufacture and supply with emphasis on. Customer requirements at
competitive prices. Use of Eco-Friendly raw materials. Improve the quality
of the paper to that of International standards. Become globally competitive in
terms of cost, pricing and quality. Continuous process improvements.
Involvements of all employees. Suppliers and dealers.

TNPL EXPORT NETWORK Australia, Egypt, Greece, Indonesia, Jordan,

Kenya, Malaysia, Myanmar, Nepal, Nigeria, Philippines, Singapore, Sri Lanka,
South- Africa, Taiwan, Turkey, U.A.E.., U.K. Yemen.

AWARDS AND ACCOLADES

In pursuit of excellence, TNPL has won many accolades. This is in recognition

of its continuous innovation and constant improvement in all spheres of its
activity. Best paper Mill 2007-08

Environment Protection 2002

Export Award 2006-07

Excellence in Cost Management 2008

Credit Rating by ICRA Ltd

Safety Award 2002

Energy Award 2001

 Best Corporate Citizen

Innovative Project

Green Rating

Excellence in Corporate Governance 2004

The Energy and Resources Institute (TERI) Corporate Award 2008

ACHIEVEMENTS OF TNPL

The centre for science & economics, New Delhi has awarded TNPL 3 leaf
green rating awarded in appreciation for its environmental management
system.

Confederation of Indian industry has recognized the bio-machination project

implementation by TNPL as an innovative project Achieved highest
production and sales 230079 MT of paper.

Production was higher by 33838 MT over previous year. Copier paper

production highest at 37645 MT registered a growth of 34%

Exported 38645 MT wood free uncoated papers.

Received the special export award from CAPEXIL in recognition of
outstanding export performance, for the seventh consecutive time.
Achieved zero-stock of finished goods at the end of financial year for
the sixteenth time.

PRODUCTION DEPARTMENT

Production is a sequence of technical processes requiring either directly or

indirectly the mental and physical skill of craftsmen and consists of changing
the type, shape, size, and properties of materials and ultimately converting them
into more useful article. Production means creation of utilities which factors
include the activities or procurement and utilization of production viz.,
manpower, material, machinerys and buildings.

Production Department in TNPL headed by the General Manager and has the
following two major areas.

Paper Machine
Pulp Mill

The main task of this development is to achieve the target production with good
quality of Newsprint and Writing paper. Chief Managers, Deputy Managers,
Engineers and operators assist him.

PAPER MACHINE

The paper machine area has two machines namely PM#1, and PM#2. The
machine 1 was supplied by Beloit Walmsely, UK. It is twin wire former having
a deckle width of 6.8m, which produces newsprint of 49 GSM paper. The
machine is also capable of producing printing and writing papers between the
weight ranges of 40-80 GSMs. The paper machine 2 is designed to achieve high
quality paper. This machine has an on line process basis to weigh moisture and
ash. Converting, finishing and packing lines have been provided for production
of finished paper in reels or sheets of required dimensions. Facilities automatic
reel handling and reel wrapping systems. The sheeting system consists of 3
cutting machines salvage sheeter and micro processor based 2 guillotine
machines with an aggregate capacity of 180 tpd.

PULP MILL

The Company produces the following varieties of pulp to manufacture

Newsprint, printing and writing papers.
PULP MAKING PROCESS PULPING is a process of separation of fibrous-
mass from the raw materials. There are three types,

MECHANICAL PULPING
CHEMICAL PULPING
SEMI CHEMICAL PULPING

For all these process wood is mainly used as raw material. In this process the
undesirable components like sand, stone etc., can be removed

MECHANICAL PULPING
It is a process in which wood pulp is ground well and mixed with steam.
The presence of heat softens the lignin and grinding process pulls the
fibre out. This process is not often used because the paper obtain from
this are less strong. They are mainly used for printing papers such as
Newsprints, Telephone Directories.
CHEMICAL PULPING the chemical pulping includes Soda pulping,
Sulphate pulping and Sulfite pulping. The important one among these is
Kraft pulping. Soda pulping process is carried out by treating the wood
and chips with caustic soda solution to fibre by cooking them in
pressurized vessels. In Sulphate pulping the wood chips is cooked with
Sulphurous acid and salt of this acid. Sulphate pulp is used I the
manufacture of bond writing high grade book and other fine papers.
SEMI CHEMICAL PULPING It is a process involving an essential
chemical treatment followed by a treatment in advanced mechanical
fibering equipments. In this pulping process the wood is treated with mild
chemical to soften lignin to loosen the fibres. It is also known as Sulphate
process. It was invented by a French Chemist named F.Dhal in Germany
in 1884. In this process wood chips and cooking liquor is heated.
Digesters for about 90 minutes at 701-173c. The cooking liquor is
aqueous solution NaoH, Na2s. The other cooking liquor is Na2Co3,
 Na2So4. Thiosulphate and Polysulphide which are present with them in a
little amount.

COOKING PROCESS

The Cooking process contains two types.

Batch Process
The chips are cooked in an individual digester with loading.
Cooking and Dumping done in sequence.

CONTINUOUS PROCESS

The chips and cooking liquor are fed at a constant rate into the top of the
digester and the chips moves downwards in a continuous manner for discharge
from bottom.

In both the process the cooked chips are discharged from digester under
pressure. The pulp coming out of the digester is very dark in color and could
brow stock. It is thin washed and further sent to bleaching process. In this
industry they follow continuous process.

BLEACHING PROCESS

Bleaching is a process to remove the unwanted particles and to increase the pulp
properties. Chemical pulp bleaching is based on removal on elimination of
colored groups.

The bleaching process usually consists of Chlorination treatment followed by an

alkaline extraction after which further bleaching treatments are applied. The
Chlorination stage may be made with chlorine or with a hypochlorite mixture or
CIO2. Further the reagents used in bleaching process and H2o2, CIO2,
hypochlorite. So in case of high yield pulp Zn or Na hydrosulphite can be used.
After bleaching the pulp were drawn at different proportions. The obtained pulp
is used for making paper through paper machine.

STOCK PREPARATION PROCESS

Most of the pulp cannot be used for paper making as it comes directly from the
pulp mill. The obtained final desired qualities, pulp having different
characteristics are blended with dyes and special additives. These operations
referred to as stock blending to impart mechanical strength to the final sheet.
The pulp is refined in a variety of machines typical of which the refined Jordan
are and beaters. Basically, this operation consists of passing the pulp repeatedly
between sharping moving bars that cut and abrade the fibers. This improves
fibers- the fiber bonding, uniformity, more dense, less porous depending on the
king of paper to be made.

VARIOUS STAGES OF STOCK PREPARATION PROCESS:

The various stages of stock preparation process are,

A. STAGE OF REFINING STAGE OF BLENDING

B. STAGE OF ROSIN STAKE OF ALUM
C. STAGE OF MINERAL FILLER OR LOADING
D. STAGE OF DILLUTION STAGE OF CLEANING
E. STAGE OF SCREENING

A) REFINING PROCESS Refining refer to the action carried out in a

continuous conical or disc type refiners where the fibre flow parallel to the bar
crossing. It is develop or modify the pulp fibres in a optical manner. It increases
the surface area of the fibre. It is a process of water absorption content is more.
It is a stage of hydrophobic into hydrophilic.

B) BLENDING PROCESS Blending is a process of addition of Alum, Rosin

and fillers at different concentration.
C) ROSIN PROCESS Rosin is an amber coloured natural resin detained from
southern pine. It provide good sizing. In practice, the rosin is added to the stock
s the solution or emulsion and is predicted into the fibbers by the action of alum.

D) ALUM PROCESS Alum is the process of hydrated of salt of Aluminium

sulphate. It is used as a fining agent. Both Rosin and alum combine to form
Aluminium and rosinate.

E) MINERAL FILLER OR LOADING PROCESS The mineral filler are added

to paper making furnishes to improve the optical and the physical properties of
the sheet. The particles serve to fill in the spaces and crevices between the fibres
thus producing a denser, softer, brighter, smoother and more opaque sheet. The
most common paper making fillers are clay, CaCo3, talc and Tio2. Clay is the
most important popular filler because it is cheap, plentiful and stable and
provides good performance. Talk provides the soft silky feel to the paper
product.

F) DILUTION PROCESS The blending process is followed by dilution process.

Since the product obtained has more consistency for about 3-5% it must be
diluted to decrease the concentration.

G) CLEANING PROCESS The dilution is followed by cleaning process. It is

done to increase the brightness of the paper.

H) SCREENING PROCESS The cleaning is followed by screening process.

The pulp which is cleaned enters the chamber. The pulp of required size enters
the chamber for paper making process. The pulp obtained is converted to 1%
consistency. This process can be shown in a simple of flow chart as below.

PAPER MAKING PROCESS

The following are the main parts of paper machine and its functions.
 1. THE STOCK INLET THE HEAD BOX
2. THE FOUR DRAINER LINES
3. THE PRESS SELECTION
4. THE DRYER SECTION
5. THE CALENDER SECTION
6. WINDING
7. ROLL FINISHING

1. STOCK INLET The objective of the inlet into piping is to distribute the paper
making fibres uniformly across the machine from back to front.

2. HEAD BOX The pressurized flow box distributes the pulp the moving
forming wire.

3. FOUR DRINER LINES The endless moving wire forms the fibres into a
sheet enables a furnish to drain by gravity and dewater by suction.

4. PRESS SECTION The sheet is conveyed through a series of presses where

additional water is removed and the wet is consolidated.

5. DRYER SECTION Most of the running water is evaporated and the fibre
bonding develops as the paper contacts a series of steam-heat cylinders.

6. CALENDER SECTION The sheet is pressed between multi rolls to reduce

thickness and smooth the surface. REEL The dried calendar paper is wound into
reel.

7. WINDING SECTION The function of the winder is to be to cut and wind the
full width, large diameter paper reel into suitable size rolls. It is then wrapped
and sent to the customers directly. 8. ROLL FINISHING The steps in roll
finishing are weighing, wrapping, crimping, heading and labelling.

RESEARCH AND DEVELOPMENT DEPARTMENT

The company adopted and developed the innovation technology of

manufacturing newsprint using mechanical biogases pulp and its endower is to
perfect and hardness the biogases pulping technology. The in-house research
laboratory facility of the company is recognised by the department of scientific
and Industrial research New Delhi. The Company has a full pledged quality
control assurance department which ensures highest quality standards of the
products.

Specific study of R&D includes Environmental bleaching technology

Pulping studies for improving pulp yield
Bio technology studies
Improvement of mechanical biogases pulp quality
Printing studies
The R&D department has sophisticated state of the art instruments.

QUALITY CONTROL DEPARTMENT

The quality control function in many paper mills is now undergoing with some
changes. The old approach to quality consisted of setting up of a quality control
department, making spot checks on incoming material, alone end of the plant
performing some in process tests and finally conducting evaluation of the
finished product. Some statistical analysis was included if such specialized
talent was available. The competitive market of the future will demand much
more. In progressive mill the classical quality control function just described is
beginning to be replaced by the concept of total quality management.

This involves the orderly co-ordination of all functions that relate to product
quality even to seemingly unrelated areas such as purchasing, engineering and
accounting shipping and warehousing. If starts with a management commitment
to a total quality effort that impacts every phase of the company.

The function of the quality control department is to measure quality keep the
score and measure the performance. The responsibility for quality lies with
everyone in the production system.

FUNCTIONS OF QUALITY CONTROL DEPARTMENT

 Testing the ongoing product for defects/deviation and informing
production department for taking corrective steps.
Certification of output and maintaining parent roll history for future
analysis of products, companies etc.
Inspection of joints and conducting Operator- Wise Reel Joint
Performance Tests.
Inspection of finishers performance & reporting.

PROCESS CONTROL COMPUTER REPORTING SYSTEM

A computer scan of ongoing product i.e. paper is continuously taken in the

paper machine cross direction and automatically recorded for the following
reports

1) Parents roll quality report highlighting GSM moisture and calliper.

2) Grade Report

3) Profile Report

4) Production, Run Time and Loss Report

5) Day Report

ROLL OF QUALITY CONTROL DEPARTMENT IN COMPLAINTS

AND PRODUCT DEVELOPMENT

1) Visiting the customer for complaints investigation.

2) Analyzing the complaints and advising the production department for quality
improvement.

3) Attending to product trails at frequent intervals, arranged by the marketing

department to get first-hand knowledge about their product and its performance
of competitor-product.

MARKETING DEPARTMENT
The marketing functions are done at corporate office in Chennai and the factory
at kagithapuram. The company has branch offices at Bangalore, Calcutta, Delhi,
and Mumbai. Each branch office has its own go down and is functionated by the
company. It also operates in place like Cochin, Luck now, and Cut tack, which
are not maintained by the company. The marketing is headed by the director
(Finance) the marketing operations are comprised.

There is a good demand for the companys products, despite the premium
prices. Quality of both Newsprint & printing & writing paper are comparable to
imported products prices much lower.

OBJECTIVES

Providing technical support to TNPL products.

Identifying source and solutions to consumers problems apart from
quality complaints.
Assessing general nature of competition.
Providing more reliable Feed-Back for ensuring quality assurance.
Earning goodwill through better report with actual users.

This has assured that TNPL not only meets requirements of the customer but
ensures their satisfaction also. Online quality control has been the hallmark of
TNPL. TNPL sells its entire production printing & writing paper is being sold
through a network of dealers and distributors speed across the country. The
following are the distribution network for TNPL products.

COMPETITORS FOR TNPL

JK
ITC Bhatrachalam
SPB
Bathravathy Paper Mills
Ballarpur Industries
SPB Ltd.
Sirpur Papers
FUNCTIONS OF MARKETING DEPARTMENT

In TNPL the marketing functions start from Madras Corporate office and the
factory and pugalur. The company has branch office at Calcutta, Delhi, Bombay,
Cuttack, pune, Bangalore, Cochin, Chandigargh, Visagapatnam, Jaipur. Each
branch office has the go down and is functioned by the company. The marketing
department is headed by the Director finance. He assists the day-to-day affairs
at the corporate office by the manager marketing, who in terms assisted by
senior sales officers and sales assistants. The site office is assisted by the chief
manager marketing.

MARKETING PRODUCTS OF TNPL

TNPL offers high-quality surface sized and non-surface sized paper to suit the
needs of modern high speed printing machines. TNPL's cutting edge technology
backed by experienced professionals ensures quality products to customers.

TNPLs manufacturing processes are equipped with state-of-the-art control

systems to maintain critical quality parameters on line. The paper produced by

TNPL is eco- friendly as the pulp is manufactured out of renewable raw

material and is subjected to Elemental Chlorine Free (ECF) bleaching. As the
paper is acid free, it has a longer colour stability and enhanced permanency in
terms of strength characteristics.

TNPL caters to the requirements of multifunctional printing processes like

sheet-fed, web offset, and digital printers. The paper reels have uniform profile
with strength properties to cope even with high speed machines. TNPL
manufactures Printing and Writing Papers in substances ranging from 50 GSM
to 90 GSM.

TNPL Ultra White Maplitho TNPL Elegant Mapilitho

Hi-Tech Maplitho Radiant Printing
TNPL Maplitho Commander
Hardbound Notebook TNPL Offset Printing
Cream wove Students' Favourites
Copy Crown Super Print Maplitho
TNPL Copier Ace Marvel
Perfect Copier
Ace Marvel

DISTRIBUTION NETWORK FOR PRINTING AND WRITING PAPER

(PWP)

For printing and writing paper (PWP) TNPL distributes through indentors and
through direct sales.

Manufacture (TNPL) -> Dealers -> wholesalers -> Consumers

1) Direct sales
Manufacture (TNPL) -> Consumer

TNPL is also making direct sales to certain major customers. Some for the
major direct customers are Navneet Publications Ahmadabad, Tamil Nadu Text
Book Corporation, Director of Stationary and Printing Govt of Tamil Nadu etc.,
TNPL has recorded the highest production of 30248 Mts.

TNPL is having the Inventors network covering the length and breadth of the
country. The inventors procure order from a customer and are responsible till
the payments received by the company.
 TNPL is poised to achieve 40,000 Mts. Of branded Note book production
during 2005- 2006.

The inventors are appointed by the company based on the past experience in the
field, his financial status and past performance, they will collect orders from
various retailers and the same will be forwarded to the marketing department.
The payment is guaranteed by the inventor on behalf of the part. The
compensation for risk taking and processing the orders from the consumers and
retailers will be rewarded in the form of turnover discount per metric tonnes
basis to the inventors of the retailers those who have more retail shops will be
considered for stockiest level. For other than Tamil Nadu and other southern
states, the retailers and consumers are not ready to purchase from Tamil Nadu
because of lorry freight as if increase the cost of the paper per metric tonne.
There are around 59 inventories in India. Exports are done through exports
dealers. Major direct consumers are

Banks
Tamil Nadu Textbook Corporation, Chennai.
Transport Corporation
Kerala book and publication society, cochin
Universities
2) Indenters sales
Manufacturer (TNPL) -> Indenters ->Wholesaler-> Retailers->
Consumers.

TNPL is having the Inventors network covering the length and breadth of the
country. The inventors procure order from a customer and are responsible till
the payments received by the company.

ORDER PROCESSING

Mostly the indenters are appointed by the company based on the past
experience in the field, this financial status and past performance. The Indents
should be sent in the prescribed format and should be complying with all
respects like codes of materials, indenter, and consignee are must. Received
indents will be processed at Chennai and sent to the site office every month of
production, production plan for the next month. Indents of those parties who
names are the outstanding list will not be processed. Two copies of processed
indents one for the consignee and another for the indenter with order acceptance
number will be sent to the indenter.

The orders are collected from the various retailers and the same will be
forwarded by the inventors to marketing department TNPL. The marketing
department consolidates the orders and gives information to production
department for manufacture of required paper with the date of paper dispatch.
The production department produces the particular variety of paper and delivers
it to the marketing go down. Then the marketing department will inform to the
customer and the head office marketing department. Then the finished product
will b arranged for transportation.

EXPORTS

TNPL exports its finished products to 17 countries. Despite severe competition

and only a gradual upward movement in the international prices. TNPL has
achieved phenomenal growth in the area of exports. TNPL has broad based the
exports and achieved the highest ever exports of 25262 Mts valued at Rs 77.40
against the 18760 Mts of wood free of paper valued at Rs 47.77 crores exported
in the previous year.

Being an ISO 9001 accredited company, TNPLs efforts have been oriented
towards developing new products to suit specific customer and specific endues.
This ISO 9001 quality assurance procedure ensures consistent quality and
assures in carrying out timely corrective action.
Exporting countries are: Australia Kenya Philippines Taiwan Egypt Malaysia
Singapore Turkey Greece Myanmar Sri Lanka U.A.E Indonesia Nepal Sudan
U.K

TNPL is having marketing offices at the major cities of the country to regulate
the marketing activities. Regular customer meets are arranged for continuous
customer feedback corrective action.

During 2004- 2005 the company has sold 7708 tonnes of Newsprint and 1,
93,532 tonnes of printing & writing papers. Of this, 41264 tonnes of printing &
writing papers exported valuing Rs. 127.68 cores. The exports recorded a
growth of 37% in quantitative terms and 47% in value terms during the year
2004-2005 compared the previous year. Thus TNPL recorded now peak in
Exports during 2004-2005.

The company has achieved all time highest production of 1, 96.240 MT and all
times highest sales of 2, 01,279 MT during the year 2004-2005.

Symbolic of TNPL commitment to the environment, the World Wide Fund for
nature (WWF) has entered into a pact with TNPL to use the panda logo in
TNPL branded products.

EXCISE DUTY

It is a kind of tax collected by central Government on the production.

Applicable Excise duty is 16% for printing & writing paper. Newsprint is
exempted from excise duty. There is no excise duty for export sales and sock
branch sales.
SESHASAYEE PAPER & BOARDS LTD:-

Seshasayee Paper and Board Ltd the second major Paper Industry next to TNPL
is SPB Ltd., in Tamilnadu. It is situated near the bank of river Cauvery in
Namakkal district, Tamil Nadu. It was established in the year 1960. SPB
produces high quality papers which are highly demanded in National and
International Market.

The Motto of the company is Zero defect and zero complaint. The company
has a well developed marketing, sales, and research & development section. The
main markets are India, china, Dubai, Sudan, and Srilanka. It regard nationally
as a clean paper mill and has to its credit to several achievement in productivity;
Capacity; Utilization; Energy conservation, Environment at preservation and
safety. Several national and international safety awards are got by this mill. 146
Around 1500 employees are working in SPB.

The company provides better working conditions, safety and welfare to the
employees. Five paper machines are erected in SPB. They are MF-1 (Black
Clawson USA), YANKEE (KMW, SWEDEN), MG (BLACK CLAWSON
USA), MF-III (GERMANY). Total production of paper per day is 450T. The
main raw materials are bagasse and wood , mainly eucalyptus, casuarinas,
wattle and globular are the wood species used here. It is equipped with two lines
of evaporation and two recovery boiler. Gotaverkan boiler, Babcock & Will Cox
boiler Electrostatic precipitators are used to control the air pollution. The
company provides a power plant having 25MW capacity.

Effluent treatment plant is provided to treat the waste water from various stages.
SPB, the flagship company belonging to 'ESVIN GROUP', operates an
integrated pulp, paper and paper board Mill at Pallipalayam, Erode-638 007,
and namakkal district in Tamilnadu, India. SPB, incorporated in June 1960, was
promoted by Seshasayee Brothers (Pvt) Limited in association with a foreign
collaborator M/s Parsons & Whittemore, South East Asia Inc., USA. After
commencement of commercial production, having fulfilled their performance
guarantee obligations, the foreign collaborators withdrew in 1969.

Main promoters of the Company as on date are a group of companies belonging

to the ESWIN group headed by Mr.N.Gopalrathnam. 147 SPB commenced
commercial production in December 1962, on commissioning a 20000TPA
integrated facility, comprising a Pulp Mill and two Paper Machines (PM-1 and
PM-2), capable of producing, writing, printing, Kraft and poster varieties of
paper.

The Plant capacity was expanded to 35000TPA in 1967-68, by modification of

PM-2 and addition of a third Paper Machine (PM-3). The cost of the expansion
scheme, at Rs 34 Millions, was part financed by All India Financial Institutions
(Rs 31 Millions). In the second stage of expansion, undertaken in 1976, capacity
was enhanced to 55000TPA, through addition of a 60tpd new Paper Machine
(PM-4). Cost of the project, including cost of a Chemical Recovery Boiler and
other facilities for enhanced requirement of utilities, was estimated at Rs. 176
Millions.

The same was part financed by term loans from Institutions and Banks to the
extent of Rs. 145 Millions and the balance out of internal generation. It
undertook various equipment balancing and modernization programmes, since
then, for improving its operating efficiency, captive power generation capacity,
etc., up to 1992-93.

The Company attaches paramount importance to the conservation and

improvement of the environment. In its efforts to improve the environmental
protection measures, the Company has installed an anaerobic lagoon for high
BOD liquid effluents, a Secondary Treatment System for liquid effluents and an
Electro Static Precipitator and Cascade Evaporator to the Recovery Boiler.
These facilities will ensure sustained compliance by the Company of the
pollution control norms prescribed by the Pollution Control Authorities.

ISO 9001/ ISO 14001 Certification : The Company's quality systems continue
to be covered by the "ISO 9001" accreditation awarded by Det Norske Veritas,
the Netherlands. The Company has also been accredited with "ISO 14001"
certification by Det Norske Veritas, the Netherlands, for its Environmental
Quality Systems. The day to day affairs of the Company are looked after by the
Chairman and Managing Director and supported by Director (Operations), and
Director (Finance) & Company Secretary. They are ably assisted by a team of
qualified and experienced professionals in operations, personnel, finance and
marketing disciplines.

Vision of the Company :

Seshasayee Paper have been producing Fine Paper since 1960. Quality and
reliability have been our by-words for over four decades We are constantly in
touch with the market and stay in tune with the industry standards. We regularly
improve ourselves to meet the ever growing demands of the printing world. Our
customer base spans over 20 countries, with an extensive range of products that
cater to varies needs.

Product of the Company:

SPB produces a wide range of products such as printing and writing papers,
packing and wrapping papers and speciality papers. SPB also has branded
products namely, "SPrint", "Colour Sprint", "Index", Sprint Plus", "Success"
etc.

JK PAPER LTD

J K Paper Ltd (formerly Central Pulp Mills), a member of HS Singhania group

is originally promoted by Parkhe Group of Pune to manufacture Paper and
Paper products. The company which fell sick and referred to BIFR was taken
over by JK Corp Ltd a member of the HS Singhania Group in 1992. JK Corp.
holds 44.76% in the equity of this company as on Nov 6, 2003.

The company has turnaround in a short period of time with the rehabilitation
package by HS Singhania Group companies JK Corp Ltd and JK Industries.

JK Paper today has an combined installed capacity of 150000 tpa with two
integrated Paper Mills at JK Paper Mills, Orissa (Inst. Cap 100000 tpa) and
Central Pulp Mills, Gujarat(Inst. Cap 50000 tpa). The company's paper mills are
operating with an health average capacity utilisation of 115%. Further the
company has purchased a Pulp Drying Plant from Finland in 2001 to increase
the output and realisation of market pulp. The plant was commissioned during
the year itself.
J K Paper has also been consistently exporting its products to markets such as
Sri Lanka, Bangladesh and several West Asian Countries. The company is the
first paper mill in India to have been accredited with ISO 14001.

The company enjoys the locational advantage in respect of sourcing raw

material. It sources all its bamboo requirements with in the 200 kms radius of
the plant. Further for long term continuous source of raw material the company
is running social forestry and farm forestry programmes in 11 districts of Orissa
and 3 districts of Andhra Pradesh, covering a total area of over 20,000 Ha. In
2001-02 it has distributed 27 million saplings, covering over 5200 hectares. .

J K Paper has been a pioneer in every field related to the manufacture and
marketing of paper. It has the distinction of being the Largest manufacturer of
branded copier paper in India.; First to introduce surface sized maplitho in
India.; First to introduce high quality bond paper 'Finesse' in A4 size consumer
friendly retail packs of 100 sheets. The company has introduced two new value
added products i.e. MICR Cheque Paper and Cup-stock Board.

The company which is well known for its success in creating brand in paper
industry with having top two paper brand (i.e JK Copier[contributing 140 cr. to
co's turnover in FY02-03] & JK Easy Copier) in its basket the company has
initiated outsourcing of paper products in India. This outsourcing activity was
kick-started in the end of 2001-02 and gathered momentum last year. The
company has outsources JK Cote (positioned in upper art paper segment) from
an international producer who produces as per the specification of JK Paper.
The company outsources domestically JK Eco Cote (caters to price conscious
Chrome paper segment) and 'JK Eco Print'.

The Scheme of Compromise and/or Arrangement between JK Corp Limited and

The Central Pulp Mills Limited was approved and sanctioned by the High Court
of Orissa and High Court of Gujarat and become effective on 5th November,
2001. Subsequent to this the name of the company was changed to JK Paper Ltd
from The Central Pulp Mills Ltd.

Latest Development: JK Paper is planning to upgrade over half of its paper

manufacturing capacity to manufacture coated paper. The upgradation
(Conversion from non-coated to coated) to cost around Rs.60 crs.

Vision of company:-

Vision & Values Stands For

Dynamic & Successful business organisation

A Socially-valued Enterprise
Business Integrity

Core Values - Caring for people - Integrity including intellectual honesty,

openness, fairness & trust - Commitment to Excellence

Product of the Company:-

Product mix includes well known brands like JK Copier, JK Copier Plus, JK
Easy, Copier Sparkle, Cedar, JK Excel Bond, JK Bond in the Multi-functional
Office paper segment; JK TuffCote, JK Ultima, JK TuffPac, JK IV Board, JK
Endura and JK Club Card in high-end packaging boards. In Printing &
Writing papers, it has brands like JK Cote and JK Ledger; in Specialty papers,
MICR cheque paper, Parchment, and Cedar Digital. In addition JK Paper has
premium brands like JK excel, Notepad, JK Photovista under Stationery
Business.