A PROJECT REPORT ON

IFFCO

INDIAN FARMERS FERTILISER COOPERATIVE LTD

KANDLA

(A DIVISION OF NIS SPARTA LTD.A RELIANCE ANIL

DHIRUBHAI AMBANI GROUP CO.)

SUBMITTED TO : SUBMITTED BY :

NIS ACADAMY MANEESH KUMAR

TABLE OF CONTENTS

Acknowledgement………………………………………………

Preface……………………………………………………………

INTRODUCTION

ORIGIN OF IFFCO

INDIAN FARMER SUCCESS STORY

(i) IFFCO IN BRIEF

(ii) SHARE CAPITAL

(iii) KANDLA UNIT

MARKETING PERFORMANCE

MARKEING CHENNAL

DISTRIBUTION & WAREHOUSING

MARKETING TERRITORIES OF IFFCO

SALES PERFORMANCE

SALES DURING KHARIF SEASON

SALES DURING RABI SEASON

FINANCIAL PERFORMANCE

TURNOVER

SERVICE TO FARMERS

COOPERATIVE RURAL DEVELOPMENT TRUST (CORDET)

ACTIVITIES OF CORDET

MAJOR AWARDS RECEIVED

VISION ---2010

BROAD VISION OF THE SOCIETY INVESTMENT FOR CAPACITY

INCREASE

US$ 1.5 Billion INVESTMENT IN POWER PROJECT

US$ 0.6 Billion INVESTMENT IN SEZ

IFFCO PLANTS

IFFCO SUBSIDIARIES

IFFCO ASSOCIATES

IFFCO ASSOCIATES

CUMULATIVE ACHIEVEMENTS

CONCLUSION

SUGGESTION

ACKNOWLEDGEMENT

I would like to express my sincere gratitude and thanks to all who in some way or the other helped and guided me in the due course of the completion of this project work. It was indeed impossible for me to accomplish to this task without the timely accelerating encouragement and exuberant support .it will be unfair to mention the name of those who directly or indirectly helped me to make it a success.

It goes beyond words to express my special thanks to Mr. MITESH PATEL , who despite of her busy schedule for providing information which I required for my project.

Thanks all of you Your sincerely MANESH KUMAR MBA 1ST Year

PREFACE

Master of business administration (MBA) one of the most

reputed professional courses which includes both the theoretical

and practical training as a part of two year curriculum. Progress is

the continuous process. It is relative and absolute. We can not stop

at certain destination and declare that target has achieved.

The Industrial visit programs are designed to give the

manager of the future, a feel of the corporate happening and work

culture. These real life situations are entirely different from the

simulation exercise enacted in an artificial environment in side of

classroom. And it is precisely because of this reason that this

industry visit is a bridge between the institute and the organization.

Industrial visit programs made me to understand how theoretical

knowledge will be applied in practical field.

It exactly in this context that I was privileged enough to join

IFFCO,KANDLA. On 20,FEB, 2009, as a Industrial Visit. This

is a cooperative society of FERTILIZER and it is known not only

in professional management, but also in enlightened and

progressive approach towards employee welfare and betterment of

society.

I have collected all the relevant information through this

visit.

INTRODUCTION

ORIGIN OF IFFCO

Till mid sixties cooperatives in India had no production facility despite marketing nearly 70% of fertilisers.

IFFCO was established as the farmers’ own initiative in Cooperative Sector on 3rd Nov. 1967 with the proposed plants at Kalol & Kandla.

With the enactment of Multi State Co-operative Societies Act 2002, the Society is deemed to be registered as a Multi State Co-operative Society. The Society is fully owned by Cooperatives.

Top of Form

.

IFFCO : Indian Farmers' Success Story

During mid- sixties the Co-operative sector in India was responsible for distribution of 70 per cent of fertilisers consumed in the country. This Sector had adequate infrastructure to distribute fertilisers but had no production facilities of its own and hence dependent on public/private Sectors for supplies. To overcome this lacuna and to bridge the demand supply gap in the country, a new cooperative society was conceived to specifically cater to the requirements of farmers. It was an unique venture in which the farmers of the country through their own Co-operative Societies created this new institution to safeguard their interests. The number of co-operative societies associated with IFFCO have risen from 57 in 1967 to 38, 155 at present.

Indian Farmers Fertiliser Co-operative Limited (IFFCO) was registered on November 3, 1967 as a Multi-unit Co-operative Society. On the enactment of the Multistate Cooperative Societies act 1984 & 2002, the Society is deemed to be registered as a Multistate Cooperative Society. The Society is primarily engaged in production and distribution of fertilisers. The byelaws of the Society provide a broad frame work for the activities of IFFCO as a Cooperative Society.

IFFCO commissioned an ammonia - urea complex at Kalol and the NPK/DAP plant at Kandla both in the state of Gujarat in 1975. Another ammonia - urea complex was set up at Phulpur in the state of Uttar Pradesh in 1981. The

ammonia - urea unit at Aonla was commissioned in 1988.

In 1993, IFFCO had drawn up a major expansion programme of all the four plants under overall aegis of IFFCO VISION 2000 . The expansion projects at Aonla, Kalol, Phulpur and Kandla have been completed on schedule. Thus all the projects conceived as part of Vision 2000 have been realised without time or cost overruns. All the production units of IFFCO have established a reputation for excellence and quality. A new growth path has been chalked out to realise newer dreams and greater heights through Vision 2010 which is presently under implementation. As part of the new vision, IFFCO has acquired fertiliser unit at Paradeep in Orissa in September 2005. As a result of these expansion projects and acuisition, IFFCO's annual capacity has been increased to 3.69 million tonnes of Urea and NPK/DAP equivalent to 1.71 million tonnes of P2O5.

IFFCO has made strategic investments in several joint ventures. Godavari Fertilisers and Chemicals Ltd (GFCL) & Indian Potash Ltd (IPL) in India, Industries Chimiques du Senegal (ICS) in Senegal and Oman India Fertiliser Company (OMIFCO) in Oman are important fertiliser joint ventures. Indo Egyptian Fertiliser Co (IEFC) in Egypt is under implementation. As part of strategic diversification, IFFCO has entered into several key sectors. IFFCO-Tokio General Insurance Ltd (ITGI) is a foray into general insurance sector. Through ITGI, IFFCO has formulated new services of benefit to farmers. 'Sankat Haran Bima Yojana' provides free insurance cover to farmers along with each bag of IFFCO fertiliser purchased. To take the benefits of emerging concepts like agricultural commodity trading, IFFCO has taken equity in

National Commodity and Derivative Exchange (NCDEX) and National Collateral Management Services Ltd (NCMSL). IFFCO Chattisgarh Power Ltd (ICPL) which is under implementation is yet another foray to move into core area of power. IFFCO is also behind several other companies with the sole intention of benefitting farmers.

The distribution of IFFCO's fertiliser is undertaken through over 38155 co-operative societies. The entire activities of Distribution, Sales and Promotion are co-ordinated by Marketing Central Office (MKCO) at New Delhi assisted by the Marketing offices in the field. In addition, essential agro-inputs for crop production are made available to the farmers through a chain of 158 Farmers Service Centre (FSC).

IFFCO has promoted several institutions and organisations to work for the welfare of farmers, strengthening cooperative movement, improve Indian agriculture. Indian Farm Forestry Development Cooperative Ltd (IFFDC), Cooperative Rural Development Trust (CORDET), IFFCO Foundation, Kisan Sewa Trust belong to this category. An ambitious project 'ICT Initiatives for Farmers and Cooperatives' is launched to promote e-culture in rural India. IFFCO obsessively nurtures its relations with farmers and undertakes a large number of agricultural extension activities for their benefit every year.

At IFFCO, the thirst for ever improving the services to farmers and member co-operatives is insatiable, commitment to quality is insurmountable and harnessing of mother earths' bounty to drive hunger away from India in an ecologically sustainable manner is the prime mission. All that IFFCO cherishes in exchange is an everlasting smile on the face of Indian Farmer who form

the moving spirit behind this mision.

IFFCO, to day, is a leading player in India's fertiliser industry and is making substantial contribution to the efforts of Indian Government to increase foodgrain production in the country.

IFFCO - IN BRIEF

• Largest producer of fertilisers in the country

• No. of Plant Locations : Five

• Installed Annual Capacity (‘000 MT)

UREA - 4242.2

NPK/DAP - 4335.4

TOTAL ‘N’ - 2628.2

TOTAL ‘P2O5’ - 1712.8

Only Fertiliser Institution in the country to produce 68.47 lakh MT of fertilisers and 93.24 lakh MT of sales during 2007-08

Contributed about 20% to the total ‘N’ and 25% to the total “P2O5” produced in the country during the year 2007-08

Fertilisers marketed through 39564 Cooperative Societies and 158 Farmers Service Centres

Service to the Farmers through a variety of programmes

SHARE CAPITAL

Authorized Share Capital : 1000.00Subscribed and : 423.93Paid up Capital

(All Share Capital wholly owned by Cooperatives only)

FERTILISER PRODUCTION 1037 Lakh MT

57

2552826960 28134

30200

3507237381

39564

1967-68 1974-75 1980-81 1986-87 1992-93 1998-99 2004-05 2007-08

GROWTH IN NUMBER OF MEMBER SOCIETIES

(As on 31st March)

FERTILISER SALE 1126 Lakh MT

CUMULATIVE PRODUCTION TILL DATE

TURNOVER Rs. 92005 Crore PROFIT BEFORE TAX Rs. 6445 Crore

PROFIT AFTER TAX Rs. 4994 Crore

CONTRIBUTION TO EXCHEQUER Rs.5103 Crore

UNIT PRODUCT PRODUCTION

KALOL UREA 139

PHULPUR - I UREA 142

PHULPUR - II UREA 89

AONLA – I UREA 165

AONLA – II UREA 98

TOTAL UREA 633

KANDLA NPK 235

DAP 155

PARADEEP NP 6

DAP 10

TOTAL NPK/DAP 406

TOTAL FERTS. 1039

NUTRIENTS ‘N’ 345

‘P2O5’ 147

KANDLA UNIT

YEAR OF COMMISSIONING : 1975

INVESTMENT : Rs. 24.26 Crore

YEAR OF FIRST EXPANSION : 1981

INVESTMENT : Rs. 28.60 Crore

YEAR OF SECOND EXPANSION: 1999

INVESTMENT : Rs. 205.30 Crore

PRODUCT CAPACITY TECHNOLOGYP2O5 TPA

9,10,000 FOUR STREAMS (A,B,C & D) BASED ON TVA SLURRY GRANULATION PROCESS. TWO STREAMS (E & F) BASED ON AZF PIPE REACTOR TECHNOLOGY.

‘N’ 3,51,540

57.0161.54 64.35

70.12 68.47

2003-04 2004-05 2005-06 2006-07 2007-08

(Lakh MT)

TOTAL FERTILISER PRODUCTION

GROWTH IN PRODUCTION CAPACITIES (Lakh MT)

3.96

8.91 8.91

16.17

23.43 24.91

32.18 32.18

36.89 36.89 36.89

42.42

8.81 8.81 8.81

21.9124.15

43.35

36.89

4.164.16

43.35

16.00

8.81

19.74

8.81

4.160

10

20

30

40

50Urea

NPK/DAP

UNIT PLANT 2003-04 2004-05 2005-06 2006-07 2007-08

KANDLA TRAIN A 312 300 299 225 242

TRAIN B 305 317 317 303 249

TRAIN C 256 322 309 302 248

TRAIN D 293 296 329 299 239

TRAIN E 261 290 316 301 225

TRAIN F 256 285 321 293 235

AVERAGE 280@ 301 315 287@ 240

@ Low due to shortage of raw material

STREAM DAYS ACHIEVED

MARKETING TERRITORIES OF

MARKETING CHANNELS

Distribution of fertilisers mainly through the Cooperative System:

State level Apex Cooperative Marketing Federation acts as wholesaler

Direct supplies to Societies in some States

IFFCO-NCDC Cooperative Societies

Small quantities to institutional agencies like Agro Industries Corporation etc

158 IFFCO Farmers Service Centres

DISTRIBUTION & WAREHOUSING

TRANSPORTATION

Both by Rail (88%) and Road (12%)

WAREHOUSING

Federations & Cooperative Godowns

Central Warehousing Corporation (CWC) and

State Warehousing Corporation (SWC)

MARKETING TERRITORIES OF IFFCO

MARKETING CENTRAL OFFICE

MARKETING CENTRAL OFFICE

NORTH CENTRAL ZONE(LUCKNOW)

NORTH CENTRAL ZONE(LUCKNOW) NORTH ZONE

(CHANDIGARH)

NORTH ZONE(CHANDIGARH) SOUTH ZONE

(BANGALORE)

SOUTH ZONE (BANGALORE) WEST ZONE

(BHOPAL)

WEST ZONE(BHOPAL) EAST ZONE

(KOLKATA)

EAST ZONE(KOLKATA)

UP,BIHARJHARKHAND,UTTARANCHA

L

UP,BIHARJHARKHAND,UTTARANCHA

L

PUN, HAR,RAJ, J&K,

HP

PUN, HAR,RAJ, J&K,

HPAP, TN, KAR,

KERALA

AP, TN, KAR,KERALA

GUJ, MP,MAH,

CHHATTISGARH

GUJ, MP,MAH,

CHHATTISGARH

ASSAM, ORISSA,

W.B.

ASSAM, ORISSA,

W.B.

SALES PERFORMANCE

(Lakh MT)

SALES DURING KHARIF SEASON

(Lakh MT)

SALES DURING RABI SEASON

(Lakh MT)

FINANCIAL PERFORMANCE (Rs. Crore)

TURNOVER(Rs. Crore)

SERVICE TO FARMERS

Agricultural Extension and fertiliser use promotion programmes are an integral part of the marketing activity. Programmes are conducted at Area/State/Zonal offices under the guidance of agricultural scientists.

Programmes undertaken are :

Balanced Fertilisation programmesAdoption of villages for all round socio-economic developmentFarmers visit to various agricultural institutes and research farmsFarmers’ Meetings, Field Days and Crop SeminarsStatic/Mobile Soil Testing Laboratories with Audio-visual aids

COOPERATIVE RURAL DEVELOPMENT TRUST (CORDET)

PROMOTED BY IFFCO LOCATIONS

KALOL (GUJARAT) PHULPUR (U.P.) KANDLA (GUJARAT)

ACTIVITIES OF CORDET

Farmers’ Training Soil Testing Bio Fertiliser Production Demonstration FarmingSeed Multiplication

BSNL VPN

Airtel VPN

IFFCO’s MPLS VPN

Network & Security

SetupVSATVSAT VSAT VSATVSAT

PIX 506

PIX 506

KandlaLAN

KalolAonla

PhulpaurParadeepLAN

Chandigrah

Lucknow

BhopalBanglore Kolkata

VSAT Connectivity to Zonal Offices

Servers

Core Router In GLBP Mode

Servers

User Zone

3560 L3 Switch

Checkpoint Firewallon Alteon

Core L3 Switch

Internal Switch

PIX Firewallin HA Mode

External SwitchIPS In Inline Mode Gig0/1

Gig0/2Router

Airtel

MPLS CLOUD

600 Connections91 Direct on MPLS and 509 MPLS VPN Client

Spectra net- 1

Internet

Spectra net- 2

ASA Firewall

Call ManagerVMS, ACS, Checkpoint Security servers

SO & AOMktg offices

Remote offices Saket office

LAN

MAJOR AWARDS RECEIVED

Seven Awards for Best Overall Performance from FAI Two Awards for Industrial Safety from GOI

Award for Technical Innovation from FAI

Two Raj Bhasha Shields for promoting Hindi

Four Awards for Safety from National Safety Council, Chicago, one Award from Gujarat Safety Council and Certificate of “Lowest Disability Injury Index”

Indo German Greentech Environment Excellence Award

National Safety Award (Runner up)

Two National Energy Conservation Award and Letter of Appreciation from Govt. of Gujarat

Vishwakarma Rashtriya Puraskar to three employees from Govt. of India

VISION ---2010

BROAD VISION OF THE SOCIETY

To augment the incremental income of farmers by helping them to increase their crop productivity through balanced use of energy efficient fertilisers

To maintain the environmental health

To make cooperative societies economically and democratically strong for professionalised services to the farming community to ensure an empowered rural India.

The Society has embarked upon another growth plan titled “VISION 2010” to achieve annual turnover of Rs. 15,000 crore (USD 3750 Million) by the year 2010.

Society is exploring avenues for diversification into other profitable business areas, apart from fertiliser sector, for sustained growth and adequate return to member shareholders.

Vision 2010 would mainly focus on farmer oriented schemes and strengthening of cooperative infrastructure.

Broadly identified business activities under the “VISION 2010“ are :-

Installation of Ammonia/Urea plants including acquisition of fertiliser units

Generation of Power

Production and Marketing of micro-nutrients, seeds, bio-fertilisers, pesticides etc.

Value addition to agri-products and marketing

Banking and Financial Services

Information Technology and IT enabled services

Establishments of Retail Chain in urban and semi-urban locations

INVESTMENT FOR CAPACITY INCREASE

IFFCO has envisaged a major expansion/diversification plan to invest USD 1 Billion to ramp up the Domestic Fertiliser Production Capacity, Acquisition of Plants, Joint Ventures in foreign countries and Energy Reduction Measures in existing Units:

►Energy Saving Project (ESP) has been implemented in all Ammonia and Urea Plants at Kalol, Phulpur and Aonla units with total investment of Rs. 412 Crore (USD 103 Million).

►Capacity Enhancement Project (CEP) implemented at Phulpur and Aonla units in May’08.

►A State-of-the-Art phosphoric acid plant in Egypt (IEFC) alongwith EL Nasr Mining company (ENMC), Egypt with a project cost of USD 325 million having an installed capacity of 0.5 Million MTPA of P2O5. IFFCO’s equity in IEFC is 76% and ENMC’s equity is 24%.

►Another Phos. Acid Plant (JIFCO) with Jordan Phosphatic Mines Co. Ltd. (JPMC) with project cost of USD 580 Million having capacity of 1500 MT per day. IFFCO holding is 52%.

► Acquired NPK/DAP Plant of 2 Million MTPA at Paradeep alongwith Phosphoric Acid and Sulphuric Acid at a cost of USD 505 Million in October 2005.

US$ 1.5 Billion INVESTMENT IN POWER

PROJECT

1320 MW Power Project at Chhattisgarh.IFFCO Chhattisgarh Power Ltd. with Chhattisgarh State Electricity Board (CSEB) incorporated on 25.01.2006 .Salient features of the Project :

Total estimated project cost USD 1.5 billion

Equity participation by IFFCO (74%) and CSEB (26%)

Scheduled commissioning of first unit of 500/660 MV in 2011

Low tarrif electricity to farmers of Chhattisgarh

Active participation of Government in the land, coal, water and infrastructure fronts

US$ 0.6 Billion INVESTMENT IN SEZ

IFFCO has laid foundation stone for IFFCO KISAN SEZ at Nellore, India, on March 21, 2008. Special features are :

Estimated investment of USD 600 Million

Closed to Krishnapatnam Port

Farmer Friendly infrastructure planned

Provision for Food Processing Zone

Secondary and Tertiary Industries under consideration

IFFCO PLANTS

IFFCO SUBSIDIARIES

IFFCO TOKIO GENERAL INSURANCE COMPANY LTD.

INDO EGYPTIAN FERTILIZERS COMPANY, SAE

JORDAN INDIA FERTILIZER COMPANY LLC

IFFCO CHHATTISGARH POWER LTD.

KISAN INTERNATIONAL TRADING FZE

IFFCO TOKIO INSURANCE SERVICES LTD.

IFFCO KISAN BAZAR LTD.

IFFCO KISAN SANCHAR LTD.

IFFCO KISAN SEZ LTD.

INDIAN FARM FORESTRY DEVELOPMENT COOP. LTD

IFFCO ASSOCIATES

INDUSTRIES CHIMIQUES DU SENEGAL

OMAN INDIA FERTILIZER COMPANY S.A.O.C.

INDIAN POTASH LTD.

NATIONAL COMMODITY & DERIVATIVES EXCHANGE LTD.

NATIONAL COLLATERAL MANAGEMENT SERVICES LTD.

COOPERATIVE RURAL DEVELOPMENT TRUST

KISAN SEWA TRUST

IFFCO FOUNDATION

LEGEND INTERNATIONAL HOLDINGS INC.

CUMULATIVE ACHIEVEMENTS

FERTILISER PRODUCTION 104 Million MT

FERTILISER SALE 113 Million MT

TURNOVER USD 22841 Million

PROFIT BEFORE TAX USD 1600 Million

PROFIT AFTER TAX USD 1240 Million

CONTRIBUTION TO EXCHEQUER USD 1267 Million

CONCLUSION

IFFCO, to day, is a leading player in India's fertiliser industry and is making substantial contribution to the efforts of Indian Government to increase food grain production in the country.

At IFFCO, the thirst for ever improving the services to farmers and member co-operatives is insatiable, commitment to quality is insurmountable and harnessing of mother earths' bounty to drive hunger away from India in an ecologically sustainable manner is the prime mission. All that IFFCO cherishes in exchange is an everlasting smile on the face of Indian Farmer who form the moving spirit behind this mission.

SUGGESTION

Increase canteen facilities for the employee.

IFFCO has four production plants but these plants are not sufficient for production. So increase the numbers of plant.