Essar Steel is a global integrated steel producer with an annual capacity of 14 million tones with a strong presence in intensive steel consuming markets of Asia and North America.
Corporate Profile 47Billion Information Technology
Essar steel
1. Jodhpur National University, Jodhpur | Jhanwar Road, P.O. Narnadi (Boranada) Jodhpur (Rajasthan)India
Report On
BBA 2nd Semester 2013
Submitted To: - Submitted By:-
Faculty of Management Akshika Kachhawaha
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Acknowledgement
I am very thankful to everyone who supported me for this assignment and gives their guidance to complete my theses work effectively and moreover on time.
I am equally grateful to our Faculty of Management, who gave me moral support and guided me in different matters regarding the topic.
I feel immensely proud in extending our heartiest thanks to (Dr.) V.P.Gupta VC, of Jodhpur National University Deen, for providing me a platform to improve in various fields. They went out of their way and provide me with open hearted help and counseling. They have been a source of inspiration for me and their experience and knowledge have helped me in learning and giving this report a shape.
Akshika Kachhawaha
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Contents
Chapters Page no.
1. Essar Introduction 4
2. Essar Steel 7
3. Essar Business Group 13
4. Essar Steels by Business Needs 20
4.1. New product development 20
4.2. Cost optimization 22
4.3. Just-in-time delivery 24
4.4. Off-the-shelf products 25
4.5. Customization 26
4.6. Increased efficiency 27
5. Essar Steels by Application 28
5.1. Engineering 29
5.2. Shipbuilding 30
5.3. Automotive 30
5.4. Construction 31
5.5. Railways 31
5.6. White goods 32
5.7. Steel for line pipes 33
5.8. Wind engineering and power generation 33
5.9. Boilers and pressure vessels 34
5.10. Yellow goods 35
6. Conclusion 36
7. Bibliography 37
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Chapter 1 Essar Introduction
Essar Steel is a global integrated steel producer with an annual capacity of 14 million tones with a strong presence in intensive steel consuming markets of Asia and North America. It has operations in four countries
• A 10 MTPA integrated facilities in India
• A 4 MTPA steel plant in Canada
• A 7 MTPA Taconite plant under execution in USA
• A 0.4 MTPA downstream complex in Indonesia
Essar Steel India is an integrated steel producer with an annual production capacity of 10 million tones. Essar Steel’s manufacturing facility comprises ore beneficiation, pellet making, iron making, steel making, and downstream facilities including cold rolling mill, galvanizing, pre-coated facility, steel processing facility, extra wide plate mill and a pipe mill. The steel plant located at Hazira has modern infrastructure like a power plant and a port that can handle 30 million tones cargo annually.
With a focus on value added products, it produces over 300
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grades of steel conforming to quality standards of international certification agencies like API, ABS, NACE, Lloyd’s Register to name a few. Essar Steel uses information technology extensively for its operations thereby ensuring consistent quality of its products.
Essar Steel has set up a 1.5 MTPA plate mill and a 0.6 MTPA pipe mill at Hazira to add further value to its product portfolio. With one of India’s largest steel processing and distribution network with a capacity of 4 MTPA located at several industrial hubs, Essar Steel manufactures customized products catering to a variety of industry segments.
Essar Steel implements rigorous testing and inspection processes to make sure customers get a product that conforms to the highest standards of accuracy, consistency and quality. It is conferred with ISO: 9001:2000, ISO 9002, ISO 14001, ISO 27001, OHSAS 18001:1999 etc.
Sustainability has been given due importance in design and operations
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and the company has become a zero waste company. It has received many accolades and recognitions from reputed institutions like Centre for Science and Environment, Water Digest, World Steel Association, Golden peacock, Green Tech foundation, CII, CII-ITC Sustainable Development Center, Carbon Disclosure Project to name a few.
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Chapter 2 Essar Steel
Essar Steel is a global producer of steel with a footprint in India, Canada, USA, the Middle East and Asia
We are a fully integrated flat carbon steel manufacturer – from iron ore to ready-to-market products – with a current capacity of 14 million tones’ per annum (MTPA). Our products find wide acceptance in highly discerning consumer sectors such as automotive, white goods, construction, engineering and shipbuilding.
Essar Steel is one of India's largest exporters of flat products, exporting to the highly demanding US and European markets, and to the growing markets of South East Asia and the Middle East.
A number of major client companies have approved our steel for their use, including Caterpillar, Hyundai, Swaraj Mazda, the Konkan Railway, and Maruti Suzuki. Essar Steel has acquired extensive quality accreditations and our lean team gives us one of the highest productivities and lowest manpower costs among steel plants internationally.
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SEAMLESS INTEGRATION OF ESSAR
A major strategic advantage is our high level of forward and backward integration. We are totally integrated – from raw material to finished products – adding value at every stage of the manufacturing process. Our areas of operation include:
Iron ore beneficiation
We have an 8 MTPA plant at Bailadilla (Chhattisgarh) and a 12 MTPA plant at Dabuna (Odisha), both strategically established to leverage the rich iron ore deposits of the respective states. The plants pump the iron ore slurry to Essar Steel pellet plants at Visakhapatnam (Andhra Pradesh; 267 km pipeline) and Paradip (Odisha; 253 km pipeline) respectively.
Iron Ore at Odisha
Pelletization
We have an 8 MTPA pelletization plant at Visakhapatnam and a 6 MTPA pellet plant at Paradip, both of which provide vital raw material to our steel plant at Hazira (Gujarat).
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Iron and steel
We have a fully integrated world-class facility at Hazira, housing the world's fourth largest single-location steel plant. It has a steel-making capacity of 10 MTPA, holds ISO: 9001:2000, IS 9002 and TUV and ISO 140001 certification and is India Chiller Energy Efficiency Project (ICEEP) Protocol compliant.
The facility also houses a 6.8 MTPA sponge iron plant (the world's largest gas-based sponge iron plant in a single location); a 1.5 MTPA plate mill (the largest in India); a 0.6 MTPA pipe mill with internal and external coating facilities of up to 2 million square meters annually; and a 1.4 MTPA cold rolling complex comprising two galvanizing lines, a batch annealing furnace and a skin pass mill.
Steel processing
We have a downstream capability hub at Pune (Maharashtra),which houses a 0.6 MTPA cold rolling plant, a 0.5 MTPA galvanizing plant, a 0.4 MTPA color coating plant, and a 0.65 MTPA pickling line.
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Steel distribution
Essar Steel is the first steel company to set up an end user distribution chain for steel products under the brand names Essar Hypermart and Essar Expressmart. Hypermart is the world's largest steel retail chain with a network of over 375 retail outlets across India, Indonesia, Nepal and the Middle East.
Essar Steel's processing and distribution facilities are the largest in India with an aggregate annual capacity of 4 million tonnes from its facilities in Pune (Maharashtra), Hazira (Gujarat), Bahadurgarh (National Capital Region), Chennai (Tamil Nadu), Bhuj (Gujarat) and Dubai (UAE).
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INTERNATIONAL PRESENCE OF ESSAR
Essar Steel Algoma, Canada
Established in 1901, Essar Steel Algoma is a fully integrated steel producer based in Sault Ste. Marie (Ontario). With a current production capacity of 4 MTPA, the plant specializes in providing total steel solutions to North American flat roll customers.
Foundation Stone of Essar Steel at Algoma, Canada
PT Essar Indonesia
PT Essar located in West Java (Jakarta), is Indonesia's largest private sector flat products company, with a domestic market share of 35 per cent and a history of process and product innovation.
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Essar Steel Processing & Distribution UK
Essar Steel has a 0.5 MTPA steel processing center in Dudley (West Midlands) offering services for SCS, pickling and oiling in coil form, slitting and decoiling.
Essar Steel Minnesota LLC, USA
Essar Steel has established a 6 MTPA integrated pellet plant on the Mesabi iron range in north-east Minnesota, along with a concentration plant and direct reduced iron plant.
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Chapter 3 Essar Business Group
Essar Global Limited is a diversified business corporation with a balanced portfolio of assets in the manufacturing and services sectors of Steel, Oil and Gas, Power, Communications, Shipping ports and logistics, and Construction. We believe in seizing opportunities to expand our reach. Having a vintage of over 40 years, today Essar has evolved into a diversified global business group.
1) Essar Energy
2) Essar Power
3) Essar Oil
4) Essar Communications
5) Consumer Durables and IT Retail
6) Essar Shipping
7) Essar Ports
8) Essar Projects
9) Essar Services – Aegis BPO
Essar Energy
Essar Energy is a world-class, low-cost, integrated energy company focused on India and positioned to capitalize on India's rapidly growing energy demand. We have an established track-record and assets worth US$12 billion across the power and oil and gas industries.
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The combined assets of Essar Power and Essar Oil constitute Essar Energy, which was listed on the London Stock Exchange in 2010 following a highly successful Initial Public Offer (IPO), the second-largest overseas IPO ever floated by a company of Indian origin.
Essar Power
Essar Power is among India's top private sector power producers with a current generation capacity of 3,055 MW spread across several power plants in India and Canada. This capacity is being expanded to 4,510 MW by end-2012 and to 6,700 MW by 2014. It is one of the lowest-cost power producers and owns about 500 million tons of coal reserves and resources in blocks spread across four continents.
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Essar Oil
Essar Oil is a fully integrated oil and gas company of international scale with a strong presence across the hydrocarbon value chain – from exploration and production to oil retail. The company has access to a global portfolio of conventional and unconventional, onshore and offshore oil and gas blocks, with about 35,000 sq. km available for exploration. The company is also the largest coal bed methane (CBM) player in India.
Currently, Essar Oil India has over 405,000 barrels per stream day (bpsd) of crude refining capacity at Vadinar in Gujarat, India;
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Essar Oil UK has over 296,000 bpsd of crude refining capacity at Stanlow in Cheshire, United Kingdom; and Essar Energy has a 50-per cent controlling stake in Kenya Petroleum Refineries, which operates a refinery in Mombasa, Kenya, with a capacity of 80,000 bpsd.
Essar Oil has over 1,600 Essar-branded oil retail outlets in various parts of India. Essar has also embarked upon entering the African retail market by opening its first retail outlet in Kenya.
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Essar Communications
Essar Communications is a global player in the communications sector with a presence in telecom services, consumer durables and IT retail. Vodafone, its GSM-based mobile services network, has more than a million subscribers; in the telecom retail space,
The Mobile Store is the largest telecom retailer within the organized sector (over 900 outlets across India).
Consumer Durables and IT Retail
Essar has launched India's first countrywide chain of multi-brand and multi-service outlets in the telecom retail space. 'The Mobile Store' currently runs over 1,200 outlets in over 150 Indian cities and towns;
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and 'The Electronic Store' has seven outlets across India. 'The Mobile Store' is the largest Indian telecom retailer within the organized sector. It plans to offer 250 more stores this year, while 'The Electronic Store' plans to open 20 more.
Essar Shipping
Essar Shipping is an integrated logistics solution provider with a presence in sea transportation, logistics and oilfield services. The company currently has a fleet of 27 vessels, with an additional 12 new ships on order. It provides contract drilling services to global oil majors, with a fleet of 12 onshore rigs and one semi-submersible offshore rig; and two new jack-up rigs on order.
Essar Ports
Essar Ports is one of the largest owners and operators of ports in India. The company has an existing aggregate capacity of 88MMTPA across two facilities located at Vadinar (58MMTPA) and Hazira (30MMTPA) in the state of Gujarat, on the west coast of India. It is currently in the process of increasing its aggregate ports capacity to 158MMTPA at a number of locations across India.
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Essar Projects
Essar Projects is the second largest engineering, procurement and construction (EPC) companies in India. Its EPC capabilities have helped build all of Essar's industrial assets in India in the sectors of steel, oil and gas, power, and ports and terminals. The company is increasingly using its expertise to execute large external projects across the world.
Essar Services – Aegis BPO
Aegis is Essar's BPO arm. A global leader in business process outsourcing (BPO), it employs over 55,000 employees with expertise in the telecom, BFSI, travel and hospitality, consumer goods, retail and healthcare domains as well as engineering services. Aegis serves several Fortune 500 companies from 50 delivery centers across 12 countries.
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Chapter 4 Essar Steels by Business Needs
Essar Steels keeps their important needs to be very effective and
1. New product development
2. Cost optimization
3. Just-in-time delivery
4. Off-the-shelf products
5. Customization
6. Increased efficiency
New product development
Creating to deliver innovative products that fulfill market demand is a major driver for product development. With a knowledge of the market and value addition through continuous improvement in the process, Essar Steel holds the key position in market segments such as auto motives, white goods, shipbuilding, boilers and pressure vessels, structural and general engineering.
Essar Steel has developed several grades of steel for different automotive applications and is the leading supplier of hot and cold rolled steel to the automotive sector. Its high strength dent and crash resistance steel is widely accepted in the automotive OEMs in India. Essar Steel's new class of high strength steel for long member / cross members application provides the potential for weight reduction and
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increased efficiency of the vehicle. The company has developed steel which meets the stringent demands of automotive wheel manufacturers. Through a joint venture with Kobe steel Japan, Essar Steel produces surface critical skin panel grades and high strength steel for the "A" class premier passenger car segment.
The extra wide heavy plates by Essar Steel are tailor-made for specialized applications. They meet the stringent demand of critical segments such as boilers and pressure vessels, and shipbuilding providing grades as per global standards. Essar Steel is one of the few manufacturers globally, capable of producing American Petroleum Institute (API) grade steel, with a supply track record of over 3 million tonnes. The Essar Steel pipe mill is API certified to make pipes of low sulphur that find wide acceptance from international oil and gas majors.
Applications International grades HR for long & cross members EN 10149-2: S 550MC, S 650MC, S 700MC HR for wheel rim & disc SPFH540 / 590, DP590 Cold rolled steel for exposed panels BH180 / 220 Cold rolled high forming & dent resistant steel IFHS340 / 390 / 440 High strength CR steels for supporting structures SPRC440, HSLA340 / 420 New automotive grades
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Cost optimization
For complete customer delight and for retaining customers, value engineering proposition for cost saving is one of Essar Steel’s key focus- driven areas. This proposition is reflected in new product development.
Essar Steel’s dent resistant steel offers weight saving up to 15%. Its new class of HSLA for long members for truck applications has been reported to offer weight reduction of 20% with improved performance.
The Essar Steel heavy plates reduce costs to the tune of 20% in terms of fabrication, manpower and handling. Advanced technology could be leveraged to the customer end in terms of changing supply condition to alter / desired properties realizing a weight saving potential of 20%, for instance, in case of direct quenched heavy plates, special micro alloyed grades and custom made grades, could offer weight saving potential to high-end segments. Custom-made ready-to-use beams shorten project time and thus optimize costs and maximize productivity.
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Essar Steel processing and distribution facilities customize steel, reduce processing and manufacturing time, resulting in enhanced productivity for the customer. The following example illustrates Essar Steel’s value engineering proposition.
High strength substitution contributing to weight reduction and resulting in optimizing cost is well-illustrated in the following example.
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Just-in-time delivery
Essar Steel ensures that the customer remains free from the task of managing his inventory levels. The Just-in-time (JIT) delivery model helps customers control them, prevent stockouts and keep their production lines moving. Through close coordination with the customer, Essar Steel helps them minimize their costs and maximize their productivity.
The Essar Hypermart network of over 600 retail outlets further aids JIT delivery through close proximity to most end-users. Backed by the Essar Steel processing and distribution facilities and Essar Steel’s supply chain management, customers can avail steel and steel products as and when required at their doorstep.
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Off-the-shelf products
In today’s market scenario, most customers prefer to buy steel products off-the-shelf. Hence, the Essar Hypermart is greatly beneficial offering customers a wide range of steel products in various grades, sizes and quantities under one roof. In order to make steel available directly to the end-user, Essar Hypermart has established the world’s largest steel retail network of over 600 outlets that stock Essar Steel products.
Essar Steel processing and distribution provides tailor-made steel supply solutions and it allows customers to purchase products directly off-the-shelf. Customers are guaranteed steel products at the right price, good quality and JIT delivery to give them a competitive edge in their markets. (www.essarhypermart.in)
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Customization
Essar Steel produces highly-customized products catering to a variety of product segments. Right from the hot rolled steel through the entire product range, customers can order for products in customized sizes and quantities. In today’s rapidly changing market, the ability to meet the specific and stringent demands of applications gives steel manufacturers the cutting edge. Essar Steel processing and distribution facilities offer tailor-made steel supply solutions that help reduce inventory levels, optimize costs and maximize productivity.
The products and services range from providing cut-to-size, burnt-to- shape flat steel to providing custom-built components. Special beams are available in an extensive range of shapes and profiles, which provide designers and construction engineers with maximum flexibility in selecting the optimum structural steel section for their specific application.
With extensive quality accreditation, the Essar Steel lean team offers the highest productivity along with the lowest manpower costs among steel plants internationally.
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Increased efficiency
At Essar Steel, we have undertaken several key initiatives to enhance efficiency for faster and swifter delivery of products in terms of product quality and development, and service. Essar Steel believes close interface with the customer is one of the effective ways of achieving competitive advantage. Its internationally-renowned application engineering team captures customer requirements and tailors the product fast.
An IT- enabled web-based portal facilitates online tracking of the order, making the entire downstream supply chain from ordering to end- delivery the quickest in the country. An online customer complaint portal responds to the customer within 24 hours.
The port-based locations of all our plants and facilities give Essar Steel a tremendous logistical advantage. An integrated logistics system that includes an expansive offshore and onshore fleet of vehicles ensures that Essar Steel is able to meet execution targets and deliver quickly and efficiently world over.0
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Chapter 5 Essar Steels by Application
1. Engineering
2. Shipbuilding
3. Automotive
4. Construction
5. Railways
6. White goods
7. Steel for line pipes
8. Wind engineering and power generation
9. Boilers and pressure vessels
10. Yellow goods
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Engineering
Essar Steel manufactures high quality hot rolled steel conforming to various national and international standards for various engineering applications such as equipment manufacturing, industrial fabrication, kilns and gates for hydro projects, crane girders turbine runners, etc. Dimensions Thickness 1.6 – 150 mm Width 900 – 4,950 mm (mill edge) 900 – 4,850 mm (trimmed edge) Length 3,000 – 25,000 mm Dimensional tolerances As per relevant international standards
Supply condition Sheet / Plates Coils form (up to 20mm thickness & maximum width 2,000mm) As-rolled Thermo-mechanically processed Furnace normalised Shot blasted and painted
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Shipbuilding
Essar Steel manufactures high quality hot rolled steel sheets / plates conforming to various national and international standards for the shipbuilding industry that meet the critical requirements of various applications such as offshore structures, platforms, bulk carriers, cargo, etc. Essar Shipper plates specifically cater to shipbuilding segment.
Automotive
Essar Steel has comprehensive portfolio of hot rolled and cold rolled steel products, which finds usage in a variety of automotive applications, which includes panels, structural members, reinforcements, pillars, etc.
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Construction
Essar Steel manufactures a wide range of products that includes hot rolled, galvanised steel, colour coated steel and plates for the construction industry that meet requirements of various applications such as civil structures, multiplexes, bridges, dams, highways, telecom towers, power projects, mega residential and non-residential complexes. Essar Structor plates specifically cater to Construction segment.
Railways
Essar Steel manufactures structural grade, corrosion resistant steels most commonly known as CORTON steel and steel plates for railway applications such as freight stock (wagons), containers, railway carts,
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coaches, bridges, etc.
Essar Steel is the pioneer in producing special grade steel and steel plates and has been a consistent supplier to the railways. Essar Locomotors plates specifically cater to railway segment.
White goods
Essar Steel, to keep pace with the market trends in white goods segment, produces high quality cold rolled, galvanized and color coated steel that meet the stringent application demands of white goods / appliance segment where aesthetics play a crucial role. Galvanized steel The Galvanized Plain Skin Pass (GPSP) is widely used in the white goods segment. This product offers advantage in terms of: Excellent corrosion resistance Close dimensional tolerance
Color coated steel products High quality and flexible supply of color coated steel sheets offers extensive design options and also maximizes process efficiency for white goods.
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Steel for line pipes
Essar Steel manufactures steel for line pipe application as per the international standards, especially the American Petroleum Institute (API) standards. The steel plates are used for making pipes for the transport of oil, gas, water and for making offshore structures.
Essar Acidor and Essar Fluidor specifically cater to line pipe segment.
Wind engineering and power generation
Essar Steel manufactures high quality plates conforming to all international standards. The wider plate provides the designers with the flexibility of size optimization for reducing welding and fabrication cost of wind towers.
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Boilers and pressure vessels
Essar Steel manufactures high quality plates that meet the critical requirements of various boiler applications such as in power plants, process industries, refineries, coal gasifies and petrochemical exchangers; and pressure vessel applications such as in process industries, power plants, nuclear power plants and space applications.
High Strength Low Alloy Steel Plate (HSLA) from Essar Steel offers plates of ultra-high strength with hardness up to 500 BHN.
Essar Thermor plates specifically cater to Boilers and Pressure Vessels segment.
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Yellow goods
Essar Steel manufactures high quality hot rolled steel and plates that meets the critical requirements of yellow goods for applications such as mining equipment, excavators, crushers, dumper, trucks, front loaders, agriculture machines, etc. Our specialty grade for yellow goods and mining finds extensive usage where high abrasion and wear resistance is a prime requirement. Essar Rockstar plates specifically cater to Yellow Good segment.
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Conclusion
In the nutshell, I would like to say since its foundation, Essar has recognized the greater role industry plays in the development of a country like India where large sections of society suffer from severe economic and social disadvantages.
Today, as a global enterprise Essar adopts a multi-pronged strategy to address the many aspects of sustainable and responsible business. Whether it is the safety and health of its employees, business practices that affect the environment or the welfare and development of neighboring communities and the wider society, Essar constantly strives to move beyond regulatory standards and do more.