Acknowledgement I want to thank Mr Avais Mushtaq Paracha, Manager Market Analysis for giving me the chance to work with him on market analysis related to the expansion plan 2010 and marketing assignments. With the empowerment and help that he provided I got a chance to get a know how about the real business world, coordinating with the people from the NFDC (National Fertilizer Development Corporation) and the people from AC Neilsen. This really was a memorable experience working at Engro Chemicals Pakistan
Transcript
Acknowledgement
I want to thank Mr Avais Mushtaq Paracha, Manager Market Analysis for giving me the chance to work with him on market analysis related to the expansion plan 2010 and marketing assignments.
With the empowerment and help that he provided I got a chance to get a know how about the real business world, coordinating with the people from the NFDC (National Fertilizer Development Corporation) and the people from AC Neilsen.
This really was a memorable experience working at Engro Chemicals Pakistan
Project Undertaken
Objective:The objective of the report is to develop huge amount of data over the years. This includes data on fertilizer and agriculture industries. Some of the key figures pertain to
Fertilizer Industry:
1. DemandA. Month/competitor wise domestically produced fertilizer Off-takes data for all
products (political District/ Province/ Country)B. Month/Competitor wise imported Fertilizer Off-takes data for all products (political
District/ Province/ Country).C. Month wise off-takes data for N,P & K in nutrient tons.D. Month/Competitor wise export data.
3. Urea/Phosphates month wise Demand & Supply along with closing inventories data.4. Historic domestic local sales prices for all fertilizers5. Historic international prices for Urea & DAP CFR Karachi.6. Historic gas prices for domestic markets.
Agriculture Industry
7. Crop Production Figures8. Areas under various cultivations9. Data on water supply and demand10. Farmer Database11. Crop Yields12. Farm Economics for wheat, Sugarcane, Rice and cotton
Note: More data / information on fertilizer and agriculture industries if identified & justified to be added in the list above
Besides the above mentioned data there also exists vast amount of information on distribution and Market Development as well.
It is felt that there is need to organize the data so that meaningful analysis can be performed for informed decision making purposes. The data will be available to divisional head, all managers, Area Marketing Managers, Marketing Coordinators, Brands Advisors and product officers and they will be able to run customizable queries according to their requirements.
Company Profile: (source: www.engro.com)
From Esso to Engro Search for oil by Pak Stanvac, an Esso/Mobil joint venture in 1957, led to the discovery of Mari gas field situated near Daharki -- a small town in upper Sindh province. Esso was the first to study this development in detail and propose the establishment of a urea plant in that area. The proposal was approved by the government in 1964, which led to a fertilizer plant agreement signed in December that year. Subsequently in 1965, the Esso Pakistan Fertilizer Company Limited was incorporated, with 75% of the shares owned by Esso and 25% by the general public. The construction of a urea plant commenced at Daharki the following year with the annual capacity of 173,000 tons and production commenced in 1968. At US $ 43 million, it was the single largest foreign investment by an MNC in the country.
A full-fledged marketing organization was established which undertook agronomic programs to educate the farmers of Pakistan. As the nation’s first fertilizer brand, Engro (then Esso) helped modernize traditional farming practices to boost farm yields, directly impacting the quality of life not only for farmers and their families, but for the community at large. As a result of these efforts, consumption of fertilizers increased in Pakistan, paving the way for the Company’s branded urea called "Engro", an acronym for "Energy for Growth". As part of an international name change program, Esso became Exxon in 1978 and the company was renamed Exxon Chemical Pakistan Limited. The company continued to prosper as it relentlessly pursued productivity gains and strived to attain professional excellence.
In 1991, Exxon decided to divest its fertilizer business on a global basis. The employees of Exxon Chemical Pakistan Limited, in partnership with leading international and local financial institutions bought out Exxon’s 75 percent equity. This was at the time and perhaps still is the most successful employee buy-out in the corporate history of Pakistan. Renamed as Engro Chemical Pakistan Limited, the Company has gone from strength to strength, reflected in its consistent financial performance, growth of the core fertilizer business and diversification into other fields.
Investment in people, process solutions and resource conservation initiatives have reduced energy use per ton of urea by a third, whilst increasing urea production nearly six-fold since 1968. Not only does this save money, it stretches non-renewable energy sources and mitigates the impact of waste. Along the way, a major milestone in plant capacity upgrade coincided with the employee led buy-out; innovatively optimizing our resources, Engro re-located fertilizer manufacturing plants from the UK and US to its Daharki plant site – an international first. Our pioneering spirit continues in our social investments, exemplified by the only snake-bite treatment facility in the Ghotki region and the first telemedicine intervention in the country.
Businesses of the company (www.engro.com)
The years since Exxon became Engro have been both exciting and rewarding for the organization and its people. Challenges have been overcome, , goals achieved and new goals set. Engro today stands recognized as a successful business operation and a role model for doing business in Pakistan.
Engro Chemical Pakistan Limited (ECPL)
The Company’s current manufacturing base includes urea name plate capacity of 975,000 tons per annum and blended fertilizer (NPK) capacity of 160,000 tons per year. A premier brand and nationwide presence ensure sellout production. Additionally, the company imports and sells phosphatic fertilizers for balanced fertility and improved farm yields. Engro’s share of Pakistan’s phosphates market mirrors or exceeds its urea market share.
Expansion plans include a new urea plant of 1.3 million tons annual capacity, also at Daharki. The US$ 1 billion project is well underway and on track for commercial production in mid 2010. This addition will increase Engro’s urea market share to 35% from 19% at present.
Engro Vopak Terminal Limited (EVTL)
50:50 Joint Venture with Royal Vopak - a Netherlands based global leader in terminal operations. EVTL operates a bulk liquid chemical terminal at Port Qasim, Karachi. It has an impeccable safety record of handling a range of chemicals and LPG for over 10 years.
EVTL is building Pakistan’s first cryogenic Ethylene storage facility and expects to be ready by early 2009. Given its experience with gasses, cryogenics, a brown field location and international operating standards, EVTL is well-positioned to build a LNG terminal, being pursued by the Government of Pakistan.
Engro Polymer and Chemicals Limited (EPCL)
Also at Port Qasim, this 56% Engro owned Company is involved in manufacturing, marketing and selling Polyvinyl Chloride (PVC).
EPCL is undergoing expansion involving PVC production increase of 50,000 tones (current capacity: 100,000 tons p.a) and back integration through setting up of an EDC/VCM plant and a Chlor alkali plant. These initiatives are expected to conclude in phases by first half of 2009.
Avanceon (formerly known as Engro Innovative Automation Pvt. Limited)
A 63% owned subsidiary of Engro, Avanceon is the leading global automation business, providing process & control solutions. It also offers Power & Energy Management software solutions as well as High-End software that integrate production and business applications.
Previously operating in Pakistan and UAE, they have now penetrated in the USA market with the merger of ENGRO Innovative and Advance Automation. Advance Automation is an award winning technology solutions provider to manufacturers in North American and has been awarded as the System Integrator of the Year 2007 by Control Engineering.
Synchronizing to a single brand worldwide with all the engineering Standards, processes, brand identity and global brand recognition was a huge task and due to various different cultural factors it was even complex then perceived.
After months of hard work AVANCEON emerged as the new name and the true Global Automation Player. The new company name will help to reinforce the single brand identity that has emerged over the last 16 months as the two formerly separate companies have successfully worked to become a single global enterprise.
AVANCEON (Tomorrow’s Solutions Today)
Engro Foods Limited (EFL)
Engro Foods, a wholly owned subsidiary had its first full year of operations in 2007. The Company continued expanding with additions to brand portfolio, milk production and distribution capacities.
The portfolio now includes four impressive brands; Olper's milk, Olper’s cream, Olwell and Tarang. Olper’s market share peaked at 17% during 2007.
EFL operates two dairy processing factories located in Sukkur, and Sahiwal. The company’s milk collection network now boasts over 700 village milk collectors and 400 milk collection centers. Covering 2400 villages across Pakistan, the activities of the Company touch the lives of almost 51,000 farmers.
An exciting new venture is the diversification of dairy portfolio into ice cream. Work has commenced full throttle for detailed engineering and market study with a view to launch of first ice cream in 2009. Also on EFL slate is the establishment of a dairy farm with milking expected to start in second quarter 2009.
Engro Energy Limited (EEL)
This wholly owned subsidiary is setting up an Independent Power Plant near Qadirpur in Sindh; Targeting 2009 for commercial operations, the power project will have a net output of 217 MW. The plant will utilize low heating value permeate gas from Qadirpur gas field which is currently being flared.
Engro Eximp (Pvt.) Limited (EEPL)
Engro Eximp (Pvt.) Limited is a wholly owned subsidiary in the trading business of fertilizer imports.
Course of Action
As was required by the supervisor a detail presentation was given to him related to the fertilizer industry and trend analysis in it for the last 10 years.
After this in collaboration with the NFDC the data for 10 years for Fertilizer off takes, production and trade was collected and as required competitor or product wise was formed. Sheets for 1 years of all the three categories has ben attached in the appendix.
Lastly an assignment was done that includes forming os a uestionnare for theinternal branding of the Zarkhez Product.
Presentation on the Fertilizer Industry
Questionnare for internal branding of Zarkhez
Assignment: Internal Branding of Zarkhez
Q1. “Zameen ke taqat Naslon ki khushaali” This statement refers to which brand of Engro Chemicals
a. Engro Ureab. Engro DAPc. Engro Zoraward. Engro Zarkhez
Answer: DQ2. How many different grades of Engro Zarkhez are there?
a. 1b. 2c. 3d. 4
Answer: CDifferent grades of Zarkhez are Zarkhez Green, Zarkhez Blue and Zarkhez YellowQ3. Zarkhez grade 8:23:18 is targeted on which group of crops
a. Suger cane, potato, vegetablesb. Tobaccoc. Chillies, onions and other vegetablesd. Banana, Mango Apple, Citrus and other fruits
Answer: CThe NPK 8:23:18 grade is Zarkhez Green that is used for vegetablesQ4. Where is plant of Engro Zarkhez located?
a. Karachib. Dharkic. Goth Machhid. Mirpur Mathelo
Answer: AThe plant of Engro Zarkhez is located at Port Qasim in KarachiQ5. When was Engro Zarkhez launched?
a. 2003-2004b. 2004-2005c. 2005-2006d. 2006-2007
Answer: BEngro NPK was relaunched as Engro Zarkhez in 2004-2005Q6. How would you personify the brand Zarkhez in terms of age and income groupAge
a. 20-30 yearsb. 30-40 yearsc. 40-50 yearsd. 50-60 years
Answer: BIncome Group
a. High Incomeb. Middle High Incomec. Middle Low Incomed. Low Income
Answer: BQ7. What was market share of Zarhkez in year 2008?
a. 31 %b. 41 %c. 51 %d. 61 %
Answer: CAverage Zarkhez market share between 2001 and 09 in the Potash Industry is 52%. Q8. Which of the following are the salient features of Zarkhez over the straight fertilizers?
Answer: DZarkhez provides more value for your investment and at the same time provides the crop with required ratio of NPK nutrients.
Q9. Zarkhez grade 17:17:17 is targeted on which group of crops
a. Suger cane, potato, vegetablesb. Tobaccoc. Chillies, onions and other vegetablesd. Banana, Mango Apple, Citrus and other fruits
Answer: DThe NPK 17:17:17 grade is Zarkhez Blue that is used for FruitsQ10. Zarkhez grade 12:15:20 is targeted on which group of crops
a. Suger cane, potato, vegetablesb. Tobaccoc. Chillies, onions and other vegetablesd. Banana, Mango Apple, Citrus and other fruits
Answer: BThe NPK 12:15:20 grade is Zarkhez Yellow that is used for Tobacco.Q 11. Which of the following nutrient in high in concentration in Zarkhez
a. Nitrogen (N)b. Phosphorous ( P)c. Potash ( K)
Answer: CThe use of Potash helps the crop in resistance to disease and pest attacks, increases weight, improves quality, helps in nutrient transportation within plant body and ensures better utilization of N & P. Q12. What is the average use of potash in Pakistan?
a. Below 0.5 kg per acreb. 0.5 – 1.0 kg per acrec. 1.0 – 1.5 kg per acred. 1.5 – 2.0 kg per acre
Answer: AIn Pakistan the use of Potash is lowest in the world. Average use of Potash is 0.4Kg/acre in Pakistan compared to India and Egypt where the average use is 4 and 6 kg / acre respectively
