Chapter 1

 Introduction

 Importance of the study

 Need for study

 Objectives of the study

 Scope of the study

 Methodology of the study

 Limitations of the study

1
INTRODUCTION

Marketing deals with identifying and meeting human and social needs. One of the shortest definitions of
marketing is “meeting needs profitably”. Marketing people are involved in different types of entities.
Distribution is one of the major aspects of marketing. Distribution channels are probably the most visible aspect
of any company’s marketing efforts. A recent estimate puts the number of retail outlets in India at five millions.
The retail industry provide livelihood to more than 15 million people in the country. In its contribution to the
economy, the sector is too significant to ignore. Any type of manufacturing sector must and should require the
marketing and distribution channel, as the basic objective of distribution channel is to make goods/ services
available at the right time and at the right place and accessible to consumer with ease and convenience.
Fertilizer sector is very crucial for Indian economy because it provides a very important input to
agriculture. Agriculture is the back bone of Indian economy and fertilizer play a key role in agriculture
prosperity. Despite rapid growth of industrial and services during the last two decades, agriculture continues to
account for a significant share at 23% of GDP. Fertilizer being a key input in increasing the production of food
grains and other agricultural crops has an inextricable linkage with agriculture. Today, Indian fertilizer industry
is developing in terms of technology. Indian manufacturers are adopting advanced manufacturing processes to
prepare innovative new products for Indian agriculture. India has entitled as the third largest producer and
exporter of nitrogenous fertilizer.
The success of the fertilizing organizations greatly depends in the supply and demand of the customers.
So, here the importance of studying the supply and the functioning of distribution channels to match the supply
and demand is very much high.The basic objective of distribution channel is to make services available at the
right time and at the right place and accessible to customers with ease and convenience. Distribution channels
are probably the most visible aspect of any company’s marketing efforts and without the proper functioning of
distribution channels, leads to problems in demand, brand image, sales, customer confidence and satisfaction.
So, here arises some importance to study on distribution channels, its functions, in order to overcome the
problems in absence of proper distribution channels.

Distribution Channels are probably the most visible aspects of any companies marketing efforts. A recent estimate puts the
number of retail outlets in India at 5 million. The retail industry provides livelihood to more than 15 million people in the
country. Distribution decisions are critical in nature as they effect the visibility of the firm and the product. The decisions
affect the market share of the firm and the product. The decisions affect share of the firm, Hence great care has to be taken

2
in selecting distribution alternatives. Before the product is marketed, the management should determine the ways which
will be used to send the product to the market. This means establishing strategies for product distribution. Distribution
channel is the first part of market mix. Managing an Attribution channel often begins with a procedure. Thus we can
discuss the problems, opportunities and management of a distribution channel from a producer’s point of view.

Types of channels:
Ideally a manufacturer selling a product in the market will require 3 types of channels to perform these
functions:
Sales channel: This is used to perform motivational, informational, bargaining and finance functions.
Delivery channel: This involves transfer of physical products i.e. possession of the product.
Service channel: This channel performs after sale services. Here we can express mail services as
delivery channel and local offices as services channel.

Importance of the study

As competition is a common problem for all the organizations in the fertilizer industry, it is very
important to study about the distribution channels and various factors affecting the purchase of products in order
to overcome any problem regarding the factors when compared to the competitors. The success of any
company depends upon the marketing ability .finance ,production ,personnel management and any other
business functions will not really matter if there is not sufficient demand and supply for products and services
so that the company can make a profit .there arises the significance of study regarding the marketing ability of
the organization .
The fertilizer industry despite rapid growth of the industry and services sector during the last two decades,
agriculture continues to account for a significant share at 23% of GDP. About 60% of the country workforce is
employed in agriculture .it is also observed that the present system of supplying the products to dealers on
demand is so good that the company will have more sales and good brand image as there is special interest on
the channel distribution of NCFL, Kakinada.

The basic objective of distribution channel is to make services available at right time and at the right place
and accessible to consumers with ease and convenience .distribution channels are probably the most visible
aspect of any companies marketing efforts and with out the proper functioning of the distribution channel it
leads to some problems in demand ,brand image ,sales, customer confidence and competition .so ,here arises

3
some importance to study on distribution channels, its functions in order to overcome the problems of proper
distribution channels.

Need for the study

With the invention of technology, markets keep on changing, expectations keep on changing, and the
opportunities keep rising. So there is a main need for the study to access information regarding the new
inventions in technology, markets and expectations of the customers. One of the important factors for studying
the distribution channel is, it will have impact on the purchasing decision of the customers.

The success of the fertilizing organizations greatly depends in the supply and demand of the customers,
so,here need has arisen to study the supply and the functioning of distributions channels to match the supply
with demand As competition is a common problem for all the organizations in a fertilizer industry it is felt a

4
need to study about the distribution channels like competitors and various factors effecting the purchase of CFL
products in order to overcome any problems regarding the factors .

Objectives of the study:

Major objectives :

 To study the distribution channels

 To analysis the distribution the process the distribution channels

General objectives:

 To highlight the channels of distribution in Coromandel International Ltd

 To study the dispatch of stock by various means of transport

5
  Analyzing the most profitable means of transport
 To know the impact of transportation cost over prices
 To check the satisfaction level of dealers with respect to complex fertilizers supplied by
COROMANDEL
 To know how the demand and supply are affected by the distribution strategies.

Scope of the study

The study was carried out keeping in view all the aspects of distribution channel and to know the
product quality, present strategies followed by competitor, the process of distribution channel and the
effectiveness of distribution.

Scope of distribution channel its gives the detail structure of how goods passed from manufacture
to distributer /retailers. Here we will come to now about the market format to pass the product at different
level to reach the goals as well as to full fill the needs of the consumer channels of distribution helps your
product to move to the places that you can not reach directly you can cater the market that are
geographically dispersed.

6
Methodology of the study

The methodology includes:

 Primary data
 Secondary data

Primary data:

It is the data which is collected by using the questionnaire by doing survey from dealers regarding the channels
of distribution. This personal interview through questionnaire provides critical type of information on

7
knowledge intensions, demographic characteristics and opinions of various dealers. Here the study includes 30
as sample size. This survey is done based on the convenience sampling technique.

Secondary data:

It includes the data collected for some earlier research work and applicable in the study, researchers has
presently undertaken. The internal data collected includes sales results, previous research reports, company
manuals and journals. The external data includes various text books and company website. This project is
mainly confined with the secondary data to gather information regarding the product, price and various aspects
regarding the company.

Period of study:

The study was performed for 45 days.

Data analysis techniques :

Ratio configuration

Limitations of the study

 Farmers survey is out of the scope for the project undertaken

 The production techniques, technology used in the factory were not taken into consideration
 The study is confined to Kakinada and nearest villages
 The sample size of the dealers is 30 and it may not be sufficient to draw conclusions. The duration of the
study for 45 days is a constraint to arrive at a definite conclusion.
 As some of the dealers are not educated we could not get abstract information

8
Chapter 2
INDUSTRY PROFILE

9
10
 Industry profile

INTRODUCTION TO FERTILIZERS INDUSTRY:

Fertilizers refer to any materials, which supplies nutrients to plants in fields, which can be readily absorbed by
them. Since the essential physiological attribute of seeds is their ability to convert a great duel of nutrients into
grain. The spread of this variety lead for greater consumption of fertilizers simultaneously with increasing
demographic pressure on the agricultural productivity has assumed more importance. This also contributes to
the rising demand for fertilizers. The fertilizers, which are most widely used, are classified as under basing the
nutrients Available. The most widely nutrients are nitrogen, phosphorus and potash.

Straight Nitrogenous fertilizers (UREA, A. S, CAN)

Straight phosphoric fertilizers (SSP, ROCK, PHO)

NP fertilizers (DAP, 20:20:0, 28:28:0)

Straight potash fertilizers (MOP, SOP)

NPK fertilizers (NPK, 17:17:17 etc)

Other fertilizers (ZS etc)

Consequently fertilizers have become a key agricultural input so that the existence of domestic fertilizer
industry is crucial to ensure the regular supply of fertilizers and attain goals self- sufficient and food security
accordingly government policy has also encouraged the industry by giving several benefits. India has made
great studies in the development of fertilizers industry and ranks as the fourth largest producer in the work
during 1991-92. Consumption of fertilizers has gone up marginally to 12 million tons in 1991-1992. On the
recommendations of joint parliamentary committee on fertilizer pricing and in order to encourage indigenous
manufactures of die- ammonium phosphate to compete with the imported D.A.P. the customs duty on import of
phosphoric acid and ammonia was abolished.

The Company has shown improved performance in all its business segments and achieved higher
revenue of Rs. 9,940 crores for the year ended 31 March 2012 (2010-11 - Rs. 7,719 crores). Profit for the year
before depreciation, interest and taxation was Rs. 1,178 crores compared to Rs. 1,136 crores in the previous
year. Profit after tax was Rs. 693 crores as against Rs. 694 crores in 2010-11.

11
 Improved operational efficiencies and appropriate sourcing strategies have significantly contributed to
overall improved performance inspite of lower production of fertilisers due to shortage of phosphoric acid
and high volatility in the Rupee. The fertilizer business achieved a total sales volume (including imported
fertilisers) of 30.08 lakh tons as against 28.63 lakh tons achieved in the previous year. Besides, the Company
also handled .65 lakh tons of urea against 1.98 lakh tons achieved in the previous year. Timely purchase of
input raw materials and pro-active forex management coupled with faster liquidation of stocks has helped
the Company in improving operational profits.

NEED OF FERTILIZERS:

The primary sector agriculture plays a dominant role in our Indian economy. Nearly 70.6 % of
population depends on agriculture for their livelihood. The agricultural sector contributes 30% of national
income and 10% of the earth’s surface area is used to grow agricultural crops now. This is in past nearly all that
can be utilized of food is required to feed obviously, since the cultivated area cannot be expanded to any
considerate degree, the only way to supply the needed nutrition is to raise soil fertility.

Fertilizers are mined commercial by products, which contain one or more essential plant nutrients from
a material to the quantity of fertilizers it should contain nutrients in appreciable amount and in readily. In
addition, a fertilizer just like any other item should not contain or produce any substance, which is toxic to the
soil, plants or human being above permissible limits. Many countries including India has laws as to what can or
cannot be labeled as fertilizers.

Fertilizers are used for improving soil fertility so that it support larger invests. Fertilizers represent the
most common currently used by farmers to deposited plant nutrients into their soil to ensure that adequate
nutrients are available to feed the crop. Fertilizers have played a key role in our much towards achieving self
reliance in fertilizers and food that future is more challenging than was in the past.

India needs about 1 million tons incremental fertilizers nutrient to use per annum in the 90’s feed our
growing population. The incentive orientation of the administrated pricing system linked to efficiency had not
only Attracted fresh investment but also encouraged the existing units to improve operational efficiency and
overall better management of resources. The fertilizers consumption in India has increased many folds during
last two decades most of it is undergone a reasonable change in last 25 years. Modern agricultural is high
energy depends in addition; this energy input is predominantly based on fossil fuels.

12
 Fertilizers accounts of 50% of total commercial energy input used in modern India agriculture. The
advent of chemical fertilizers has helped making in solving one of the mo9st challenging tasks of food
production and sustaining soil fertility. Our county’s requirements of fertilizers or continuously on the
increasing year after year. Fertilizers use has increase from 4.6k.g/ha in 1956-66 to 50kg/ha in 1984-85 in India
total fertilizer consumption (N P K) for the country exceeded 8.72 million tons. The number of farm holding
using fertilizers is above 65%. If remaining farmers are also motivated to come within the fold of adopters and
fertilizers use is increased to recommended level the fertilizers replacement will certainly go much higher.

Commercial fertilizers are used in modern agriculture to correct known plant nutrient deficiencies, to
provide high levels of nutrition to maintain optimum soil fertility conditions. In addition, to improve crop
production. The major factors influencing the selection of the rate and placement of fertilizer are the crop
characteristics and climate especially moisture supply, yield goal and the cost of fertilizer in relation to the sale
price of the crop.

AGRICULTURE IN INDIA:

The growth of Indian economy is based on food grains consumption it is estimated that India will
need 235 million tons of food grain by 2000 A.D. during the 1980-81 and 1990-91 food grain production
increased by about 40 million tons over the next 10 years period this has to be increased by about 60 million
tones, which are, needed a challenging task. Due to population explosion in India, the net per capital availability
of cultivated land that was just 0.3 hectares in 1950 is reduced to less than 0.14 hectares by turn of the century,
during the past three decades 1960-61 to 1990-91 the total food grain reduction increased by about 90 million
tones of this commodities future the crops growth is nearly 70% of country’s rain fed areas. These areas
contributed to production of more than 40% of food grains, 80% of maize, 90% of pellet and sorghum. About
95% of pales and 75% of oil seeds are also grown in these areas.

Nearly 56% of rice is grown in high rainfall areas without supplementary irrigation, similarly, 70%
of cotton and almost whole jute and menthe are grown under rain fed conditions. The average annual growth in
agriculture production during the 8th plan aims not agriculture commodities for export to increase the income
level of the former. The existence of a domestic fertilizers industry is crucial to ensure the regulars supply of
fertilizers and action goals of sufficiency and food security, as fertilizers have become a key agricultural input,
accordingly government policy has also encouraged the industry by giving several benefits India ranks as the

13
4th largest producer in the world during 1991-92 as a result of great studies made in the development of
fertilizers industry.

Consumption of fertilizers has gone up marginally to 12 million tones. In 1991-92 on the

recommendations of joint parliamentary committee on fertilizer pricing, potassium Fertilizers had withdrawn. In
order to encourage indigenous manufactures of DI-Ammonium phosphate to compete with the improved dap
the customs duty on import of Phosphoric acid and Ammonia was abolished. The fertilizers industry in the core
sectors of the economy and rightly, since in is one of the major industries, which provides vital input for
agriculture growth i.e.; fertilizers. The crucial role and importance of fertilizers have now been from levy of
custom duty. This will have a significant in the cost of production of fertilizers.

Leveraging the Retail presence in Andhra Pradesh and Karnataka, the Company has
significantly improved the sale of specialties and captive technical formulations. In Retail business, the
Company has opened 200 new retail centres in Andhra Pradesh and Karnataka. With this expansion, the
Company has 641 centres in Andhra Pradesh and Karnataka. Retail turnover has grown by 11% during the year.
In retail business, the Company has decided to focus more on agri-input business and exit from the life style
products. The Company continues to explore Farm Mechanizations Business as part of its retail service
offerings to the farmers.

ORIGIN AND DEVELOPMENT OF FERTILIZER INDUSTRY IN INDIA:

The first plant for production of nitrogenous fertilizer was built in 1940, in small capacity which
argument with production of about 50,000 per annum. Nitrogen on the form ammonium sulphate 1951 in the
first public sector fertilizers plant in SINDRI since then, the government of India Taken the idea to build a
fertilizer plant at every state of the country. The real expansion o the industry took place in 1960’s and since
then it has been expanded at rapid rate in public, private or joint sector to meet growing demand for fertilizer,
both nitrogenous and phosphoric. The framer always wanted the fertilizers at low format price. The procedures
always wanted increase the next factor price. In 1977, the Indian government took a device step towards food
sufficiency. They arrived that the best way to increase the fertilizer consumption and through that food grain,
production by keeping fertilizer prices affordable for the farmer. Since producer would not be willing to sell at
that price the government made good differential by paying them a subsidy.

14
THE GOVERNMENT FIXES TWO PRICES:

 The price at which the manufacturer should sell fertilizers to farmers. The price fixed at level affordable
to the farmers and is uniform for all manufactures.

 A fair price at which the manufacturer ought to have received from farmer. The price is based on
prescribed efficiency norms in regard to capacity utilization.

Consumption of raw materials and usage of utilities differ with every plant thus each plant would
have different retention price is so designed that often covers and the mandatory cost the company that operated
at 90% would earn a 12% post tax return or net worth. A unit operator at higher operating rates would benefits
by way of enhanced recovery of fixed operating as also capital related charges. The government remembers
difference between the retention price and the government reimburses the selling price to the manufactures as
subsidy. The cost of transporting the materials form the factory to the consumption point it is also reimbursable
to the producer as equated freight.

The Retention-Pricing Scheme (RPS) was first introduces for Nitrogenous Fertilizers in 1977, for
phosphoric fertilizers other than Single Phosphate (SSP) in 1979, and for SSP in 1982. In the Same year imports
of DAP were canalized through MMTC in order to project the local marketed by 1991. The spiriting
expenditure on fertilizers as fertilizers subsidy have led to the widening of the Budgetary deficit. The Rao
government then on a tough ride towards economic liberalization, was Under Pressure to knock of fertilizers
subsidies, which has snowballed form Rs.25 core in Fiscal 1978 to Rs.3730 core in fiscal 1991.

In July 1991, 3 nitrogenous fertilizers namely ammonium Sulphate (AS) Calcium ammonium Nitrate
(CAN) and ammonium chloride (ACP) were Decontrolled while the selling price of all other fertilizers were
raised by 40% .In the din of the political notice that followed, this was reduced to 30%. With small and marginal
formers fully exempted from the like. The exception Abandoned soon. In August 1991 the government tracked
at the nitrogenous segment by putting as, CAN and ACI again under control, reintroduced subsidy,
decontrolling phosphoric and potash fertilizers, jettisoned the retention pricing and subsidy scheme and declared
DAP. The decontrol sent the price of phosphoric fertilizer very high this led to a sharp fall in the consumption of
the fertilizers. To partially compensate the increase the government got into the Act. If introduced a subsidy
have Rs. 500, to Rs.800,per ton on their complex fertilizers. Later it made certain smart concessions like, it

15
removed customs duty on imported phosphoric acid, allowed import of raw materials for productions of
phosphoric fertilizers.

DAP UNITS IN INDIA WITH ANNUAL CAPACITY OF PRODUCTION IMPORT OF

DAP:

From countries:- Jordan, Germany, Canada, Rumania, U.K, Japan, U.S.A, Norway, Saudi Arabia, Philippines,
Mexico, Former, U.S.S.R and others. During the period 1981-82 it was 375 cores where the year 1990-91 it was
increased to 4800 cores. Some the reasons for increase are agricultural growth, increase in cost of production
consumption of fertilizers etc.

The joint parliamentary committee reports 1991 suggested to do control phosphoric and phosphate Fertilizers in
order to reduce the subsidy burden to the government, accordingly the same with effect from 24 th of August
1992.

Chapter 3

Companyprofile

16
 COMPANY PROFILE

Coromandal International Limited

Coromandel International Limited, formerly Coromandel Fertilizers Limited, incorporated in 1964, now
belonging to the Rs.17,051 CroresMurugappa Group, is a leading company in India manufacturing a wide range
of fertilizers and plant protection chemicals (technical & formulations). Coromandel markets around 2.9 million
tonnes of phosphatic fertilizers making it a leader in its addressable markets and the second largest phosphatic
fertilizer player in India. Headquartered in Chennai, the Rs.17,051crores. Murugappa Group is one of the India's
leading business conglomerates. Market leaders in diverse areas of business including Engineering, Abrasives,
Finance, General Insurance, Cycles, Sugar, Farm Inputs, Fertilizers, Plantations, Bio-products and
Nutraceuticals. Its 29 companies have manufacturing facilities spread across 13 states in India. The organization
fosters an environment of professionalism and has a workforce of over 32,000 employees. The Group has
forged strong joint venture alliances & tie-ups with leading international companies like DBS Bank, Mitsui
Sumitomo, Foskor, Cargill, Wendt, Cargill and GroupeChimiqueTunisien Group has consolidated its status as
one of the fastest growing diversified business houses in India.

Kakinada Plant of Coromandel was earlier Godavari Fertilizer Limited which was acquired by Coromandel in
July 2003.

Company logo

Fertilizer plant at:

Andra pradesh : kakinada vishakapatanam

Tamil nadu : Ennore rainpet

Crop protection plants at :

 Rainpet in Tamil nadu

 Navi mumbai in maharashtra

17
  Ankelshwar in gujarat

 Jammu in jand k

Coromandal marketing branches servinng the framing community across are located at :

 Andra pradesh : Hyderabad, kurnal, Vijayawada, vishakapatamam

 Karnataka : Bangalore, raichur

 Tamil nadu : Trichy

 Mahrashtra : Aurangabad

 Gujarat : Ahmendabad

 Madya pradesh : Indore

 Chhattisgarth : raipur

 Orissa : bhubaneswar

 West bengal : kolkata

 Uttar pradesh : Gaziabad

 Panjab : Bhatinda

Cfl has 700 acres of manufacturing facility at kakinada in andra pradesh and is served by a neatly port railway
siding and a well connected road .The plant handles phosphatic acid and ammonium unloading through pipe
lines from port to plant .with a view to foster business relations ,foskar of south Africa and GCT of Tunisia the
two major raw material suppliers have been made shareholders with 5% each in the equity of the company .

IFFCO holds 25% along with foskar and GCT with each 5% share are the major share holders and co-promoter
of the company has also divested its shareholding in favour of CFL on 12-apr-2007.consequent to this ,the
company has become a subsidiary of CFL holds 74.92% of the capital of the company and the remaining is held
by public . The companys approximately 1.2 million MTs manufacturing facility is located in Kakinada ,very
close to sea port and has excellent infrastructure .the plant is strategically located to derive the advantages of

18
logistics –inbound and outbound .the company has superior product and process technology and production
efficiencies are comparable to the best in the world . The plant with 0.832 million MTs name plate capacity in
2003 ,when acquired by murgappa group ,is now tuned to produce over 1.15 milllion MTs per annum with
minimal additional asset .the company is one of the low cost producers of DAP and complex fertilizers using
imported phosphoric acid and has built in flexibility to change the product mix with ease both in terms of
production and marketing .

coromandel manufacturing wide range of fertilizers and markets around 2.9 million tons making it a
leader in its addressable markets and the second largest phosphoric fertilizer player in India .in its endeavour to
be a complete plant nutrition solutions company ,coromandel has also introduce a range of specialty nutrient
products including organic fertilizers . The crop protection business produces insecticides ,fungicides and
herbicides and markets these products in india and cross the globe .coromandel is the second largest
manufacturer of malathion and only the second manufacturer of phenthonate.coromandel has also ventured into
the retail business setting up more than 425 retail centers in the agri and lifestyle segments .

partners

subsidiaries :

coromanda has strategic parnerships with leading

companies across the globel including :

A technical assistance agreement with foskor [pty]

Ltd of south africa,one of the largest phosphoric acid

Produting companies,for extending coromandals technical assistance.

A joint venture agreement with groupe chimique Tunisien [GCT]

And CPG of tunisia to set up a prosporic acid plant at la skhira ,

Tunisia , at an estimated cost of US 180 million dollars .

A 50:50 joint venture with sociedad quimicay minera to set up a water solubel fertiliser [WSF] plant for
manufacturing WSF at coromandels kakinada plant.

19
Coromandel,s subsidiaries are :

 Coromandel mauritius

 Coromandal GETAX phosphates pvt.Ltd

 Coromandal brasil limited

VISION OF CFL

To be the leader in the phospharic fertiliser industry Producing high quality fertiliser at low cost and giving
Satisfaction to at low cost and giving satisfaction to all Stake holders ‘’.

MISSION OF CFL

To enhence the prosperity of farmer through the supply Of qualify farm inputs and related service to ensure
value For money ‘’.

PHILOSOPHY

The Fundamental principal of economic activity is that no man you transact with will lose then you shall
not’’.

VALUES AND BENEFITS

There are five hights :

1. Integrity

We value professional and personal integrity above all else .we achieve our goals by being honest and
straitght forword with all our stakeholders. We earn trust with every action ,every minute of every day .

20
 2. Passion

We play to win .we have an healthy desire to stretch ,to achived personal goal and accelerae business
growth . we strive consantly to improve and be energetic in evergetic in every thing that we do.

3. Qualiy

We take ownership of our work . we unfailing meet high standards of quality in both we do and the way we
do it .we take pride in excellence.

4. Respect

We respect the dignity of every individual .we belive we are open and transparent with each other.we
provide evryone equal opportunities to progress and grow.

5. Respondability

We are responsible corporate citizens .we bwlive we can help make a difference to our environment and
change lives for the better .we will do this in a manner that our size and aso reflects our huminity .

Coromandel ‘s saga of first

 Frist in india to commercially manufacture high analyisis complex fertiliser viz ,DAP 28:28:0 with
the highest nitrogen and phosphate content in 1:1 ratio

 First in india to have succesfully implemented modren anodically protected acid coolers in sulphuric
acid plant ,replacing conventional trombne serpentine coolers .

 First in india to instal a large sulphuric acid plant based on DCDA technology to control sulpher –
dioxide emission .

 First in country to succesfully implement total recycling of sea water

For this efflunce recalucalation system atteched to phosphoric acid plant

Awards and Recognitions

21
Over the years, Coromandal has as number of awards and recognisation including the British council “five star”
rating for safety management system management system and being adjudged one of the Ten greenest
companies in India by a joint survey of TERI and business today magazine

Some of the recent awards and recognitions received by Coromandal include:

 Ranked among the top 20 best employers to work for today.

 CNBC award for most engaged workforce.

 DAM –Erehwon national award for by in HR

 Public relations society of India national award (1st prize) for the VOICE, Coromandal in house
magazine, received for 4 th time.

 International award for the VOICE magazine.

 CII EXIM-BANK Business Excellence award for strong commitment to excel for Vizag &Kakinada
plants.

 FAI Best production performance award for phosphoric acid plant at Vizag received for the 9th time.

 FAI Best production performance award for complex (P202) Fertilizers for Kakinada plant

 FAI Environment protection award for complex (P202), Vizag.

 National energy conservation award (Commendation Certificate) for efforts in energy conservation
from Ministry of power, New Delhi, for Kakinada plant.

 FAI Best video film award received for the 6th time.

 FAI award received from fertilizer association of India for “improvement of overall performance of a
fertilizer unit” for the year 1994-95

 FAI award for “The best overall performance of an operating acid plant” 1995-96

22
  Commendation memento from IMC Global, USA for achieving three million man-hour safer working
without any lost time accident, consecutively for the third time in September 1995.

 Runner up award in the National Convention of Energy conservation and Management by Andhra
Pradesh productivity council in 1995.

Company achieved:

 One million safe man-hours 42nd, a, record in the fertilizers industry.

 Two consecutive million safe man-hour-4 times.

 Three consecutive million safe man-hour-4 times.

 Four consecutive million safe man-hour-onces.

 Won first prize of safety among 162 fertilizer companies in the international fertilizers industries
sectional contest in 1992.

Products and Services

Coromandal has multi-location production facilities and manufactures & markets a wide range of Phosphatic
Fertilizers, crop protection products ,and specialty Nutrients like sulphur Pastelles, water soluble fertilizers,
Micro Nutrients across the globe Coromandel also provides agri input solutions to the farmers and offers life-
style products through its rural retail centers. The Company is managed by competent and committed
professionals and is known for fostering a climate of high performance and continuous improvement

Fertilizers

23
Coromandal is a leading manufacturing of Phosphatic fertilizer with plants Located at Visakhapatnam
&Kakinada in Andra Pradesh and Ennore &Rainpe At Tamil Nadu .The range of products manufactured at
these plants includes.

Gromor 14-35-14

 Contains nitrogen phosphate and potash .

 Highst total nutrients content (63%).

 N&P ratio same as DAP .but 14-35-14 has extra 14% potash.

 Highest in potash (35%)

 Best for cotton ,groundnut ,chilly ,soyabeans ,potato,etc .

 Not suitable for tobacco and grapes .

Gromor 28-28-0

 Compelx with higest N&P in 1:1 ratio

 Unique granulation by coating prilled urea with ammonium phosphate layer .

 Such granule configuration ensures efficient utilization of nutrients .

 Highly suitable for paddy ,wheat .

Gromor 20-20-0-13

 A high analysis complex fertilizer containg all the three major

 Nutrients –Nitrogen ,phosphate and potash ,was lanched by coromandal in march 2003.

 This complex contains phosphate and potash in ratio of 1:1 ,the highest

 among the NPK fertilizer .its unique features being.

24
Sparamfos 16-20-0-13

 Ammonium phosphate sulphate contains nitrogen ,phosphate and sulpher .

 It is the most preferred in drill-snow areas .

Parry gold

 Ammonia phosphate sulphate containing Nitrogen ,phosphate and sulphur

 It is the most preferred fertilizer in drill-sown areas .

Parry super (single super phosphate )

 First chemical fertilizer to be manufactured in india

 Favoured fertilizer for dry land areas .

 Control acidity in soil and increase productivity .

DAP

 GODAARI DAP (NP 18:46) is a complex fertilizer containing two major plant nutrients –nitrogen
and phosphous .

 It is the only complex fertilizer having highest total nutrients (64%).Nitrogen and phosphate are
available in 1:2.5 ratio .Total Nitrogen and phosphorous are available in ammonical form .most of the
phosphorous nutrient is also in water soluble form (41.6) and hence available to plants immediately
after application .

25
 Godavari DAP can be used in any type of soil ,light or heavy and under all Agro-cilmatic conditions
.Being water soluble ,both Nitrogen and phosphate Contained in it are readily available to the crops .per
unit cost of phosphate nutrient in godhavari DAP is lowest .

 The NP ratio of 1:2:5 is a scientific combination for basal application to all crops and both the nutrients
are chemical combined and interaction

is synergic .Godavari DAP is a suitable NP complex fertilizer for all soils that are rich in potash .it is an
ideal and suitable complex for all crops for basal application .

 Godavari 10:26:26 in a high analysis complex fertilizer containing all

there major plat nutrients viz ,Nitrogen ,phosphate and potash ,Godhavari 10:26:26 contains phosphate
and potash in the ratio of 1:1,

 The highest among the NPK fertilizer .it contains 7% Nitrogen in the ammonical form the water soluble
form and the entire 26%potash is available in water soluble form.Godhavari 10:26:26 is ideally suitable
for crops which require high phosphate and potassium and low nitrogen and this grade is very popular
among the sugarcane farmers of Maharastra ,Karnataka and Andra pradesh .Godavari 10:26:26 is also
suitable for potato ,paddy and banana.

 Godavari 12:32:16 is a complex fertilizer containing all three major plant nutrients viz. Nitrogen,
Phosphate and Potash.

 Godavari 12:32:16 is a complex fertilizer containing all three major plant nutrients viz. Nitrogen,
Phosphate and Potash. This is one of the highest nutrient containing NPK complex fertilizer with total
nutrients of 60%. Nitrogen and Phosphate are available in the ratio 1:2.6 as in case of DAP, but
Godavari 12:36:16 also contains 16% Potash additionally. Godavari 12:32:16 is an ideal complex for
soyabean, potato and other commercial crops which require high phosphate during the initial stages of
growth.

26
  Godavari 12:32:16 helps the young plants to establish faster, even under adverse soil or climatic
conditions. Godavari 12:32:16 helps in greater root penetration and better root system even in poor soils
of unstable structure resulting in higher yield from such soils. Vigorous rapid growth initiated by
Godavari 12:32:16 renders the plants resistant to various pests and diseases.

 Godavari 14:35:14 is a complex fertilizer containing all three major plants nutrients viz. Nitrogen
phosphate and Potash. This is the only complex having highest total nutrient content among all the NPK
complex fertilizers (63%)

Crop Protection

Coromandel manufacture & market crop protection products Including Insecticides, Fungicides,
Herbcides and plant Biostimulant. Our crop protection products portfolio includes several popular
brands that enjoy leadership status in the Indian Market. Coromandel constantly Engages in reviewing
its products mix, to give the best fit for the every kind and Coromandel has strong R&D team for
developing technologically superior and environmentally safe Crop Protection products formulations
like SC, WDG, Gel micro emulsions etc’s. By providing wide range of Farm inputs that cater to
different types of requirements, the company has endeared itself to the farmers, deservedly earning a
place in his heart as a real friend in need. Coromendel exports their products to various countries
coromandel have technical tie-ups with Multinationals like Dupont, BASF, FMC, Otsuka,etc for
marketing their products in India.

We produce our crop protection products at Navi Mumbai (technical )

And Rainpet formulation .

 Endosulfan Technical 96% min. purity

 Profenofos Technical 96% min. purity

 Phenthoate Technical 92% min.purity

27
  Malathion Technical 95% min. purity

 Temephos Technical 92% min. purity

 Terbufos Technical 90% min. purity

 Cholorpyiphos Technical 98% min. purity

 Fipronil Technical 92% min. purity

 Hexaconazole Technical 92% min. purity

 Hexythiazox Technical 97%min.purity

 Buprofezin Technical 98%min purity

Speciatly Nutrients
Introduction of high yielding crop varieties (HYV ) ,intensive cropping togeth with a shift in high
analysis in mid sixties brought in a strring revolution to increase crop production in the country ,but at
the same time heavy withdrawal of essential plant nutrients through bumper harvest made soil resource
fatigue .The deficiencies of micronutrients became a serious obstacle in achieving optimum yield .The
intensification of agriculture in India has led to the increasing removal of secondary and micronutrients
from the soil and multiple nutrient deficiencies ,which are becoming a major constraint to further
increase in product ion .This is essential due to nutrient removal far in excess of nutrient additions .

The greatest blame for soil nutrient depletion rests with unbalanced fertilizer application consisting of
large N applications without a matching amount of other nutrients .what farmers have in fact been doing
in many areas ,years after years ,is to use N (urea ) as a shovel to extract the soil reserves of other
nutrients ,particularly K, P ,S and in several cases micronutrients as well. It is the depletion of nutrients

28
 which result in large increases in crop response to P and K with the passage of the time .the real
alarming situation is that in many cases even the recommendation application of fertilizer result in soil
nutrient depletion because they turn out to be sub –optional for supporting high –yielding intensive
cropping system

 Major nutrient Management Issues

 Inadequate and unbalanced use of fertilisers

 Increasing deficiencies of secondary and micronutrients

 Nutrient mining :potassium mining a major threat

 Low fertilizer use efficiency

 Low factor productivity

A significant drop in the yield and quality of crops in the country has brought into focus the need for promoting
balanced use of fertilization and educating the Indian farmer about the deficiencies of secondary and
micronutrients in the soil. A top of the agenda item for Agri-input Companies is nutrient management. In its
endeavor to be a complete plant nutrition solution company, Coromandel has, in addition to its existing farming
services, also introduced a range of speciality Nutrient products.

To give a focused thrust to marketing of speciality nutrients, Coromandel has a Speciality Nutrients division
( SND). This business compliments the Company’s efforts in improving the Indian farm productivity by
supplementing / correcting secondary and micro nutrient deficiency prevailing in Indian soils and micro
nutrient deficiency prevailing in Indian soils and focuses on the marketing of concept products for Indian
agriculture.

29
In its efforts to promote balanced fertilization Coromandel intends to be a complete plant nutrition solution
Company by adding specialty nutrients/ fertilizers to its portfolio and now offers various customized products
to its customers.

RETAIL

The retail arm of Coromandel was started in the year 2007 with 2 outlets and in 2008-09 the Company
expanded it to over 425 retail centers in rural Andhra Pradesh. The retail centers carry both agri and lifestyle
products:

The entire range of agri inputs like fertilizers, Crop Protection products, secondary and micronutrients, seeds,
sprayers, mechanized farm services, veterinary feed, as well as, soil testing for major nutrients, field visits for
crop diagnosis, technical advice at the retail center as well as on the toll-free help line “Hello Gromor”,
insurance, education, free expert technical training on agriculture and other subjects, through its Mana Gromor
retail centers.

Lifestyle products, FMCG (non-foods & foods ), apparels, footwear, consumer durables, general merchandise,
home furnishings, accessories, luggage, stationary, books and toys, through its Mitra retail centers.

Coromandel has tie ups with companies like Rashtriya Chemicals and Fertilisers, KRIBHCO, Zuari, Bayer,
Syngenta, DuPont, Monsanto, Hindustan Unilever Limited, Procter & Gamble, Colgate, Nokia, Vodafone,
Henkel etc. Coromandel’s retail centers are located at Mandal headquarters (Mandal is a revenue unit in Andhra
Pradesh, which is 1/50th of a district.) Each retail center has an average area of 2500 square feet with a
catchment area of 30-40 villages and about 5,000 farmer families.

SAFETY HEALTH & ENVIRONMENT POLICIES:

30
M/s Coramandel Fertilizers and Chemicals Limited, Kakinada the leading manufactures of Phosphatic complex
fertilizers and committed to optimizing the interest of the share holders in our business while continuously
improving our environmental performance by:

 Complying with all applicable environmental legislation, regulations and other requirements.

 Optimizing the usage of raw material utilities and energy.

 Prevention of pollution, minimizing waste generation, promoting recovery recycle and reuse.

 Maintaining green cover in and around the plant.

 Creating environmental awareness among all employees and contract workman through
communication, training and participation.

1. Process Safety Management Policy

Coramandel Fertilizers and Chemicals Ltd., give top most priority to protect the heath and safely of its
employees and the community, and protect the environment system which conforms to the best available
practices in our industry to continuously increase the safety awareness of all our employees. They are
dedicated in maintaining a safety culture which requires total involvement of all employees and
reorganization that the management of process hazards is part of every employee’s job. This policy reduces
the energy and waste conservation. Hence its controls the pollution and it is environment friendly in nature.

2. Waste management Policy:

Coramandel Fertilizers and Chemicals Limited, Kakinada has no bi-products and no waste product all that is
recycled and directs to the waste management. To maintain the DAP plant as a ‘Clean Plant’ enough
precautions were taken in technology selection as zero liquid effluent discharge plant. As stipulated by AP
pollution control Board, the company is maintaining environment and ecology as per the standards. In
addition to bring down further emission loads of Dust/ Ammonia, a new Tail gas Scrubber is also
commissioned during April/May 2002, 350,000(Three hundred and fifty thousand saplaings ) were planted
in 600 acres of land around the plant for developing green belt which provides clear environment in and
around the plant.

31
 3.Energy Management Policy

At Coramandel Fertilizers and Chemicals Ltd., A member of Murugappa group of companies are committed
to conserving scare and irreplaceable energy resources and to make the company one of the most energy
efficient mamufacturing facilities in their sector of industry. They are taking all necessary steps during
technology selection, installation, operation and maintenance of plants/equipment to conserve energy and to
create awareness among employees of “energy conservation” through training and participation in the
process of conservation.

4.Certification Policy:

Coramandel Fertilizers and chemicals Limited, Kakinada has the certification standards from Dat Norske
Veritas (DNV) department which includes the ISO standards of all the major numbering such as ISO 14001,
ISO 9000 etc.

5.Respiratory Protection Policy:

Coramandel Fertilizers and Chemicals Limited, Kakinada is been implementing protection for the workers
in respiration through:

 Dust Masks

 Cartridge Masks

 On-line Airline System

 Breathing Apparatus

CFL S Promotional strategies

In the market development programs ,the department develops communication messages to the target
customers every season to suit the changing market situation ,and design of the programs and selection of media
for promotion .The marketing officers identify the promotional needs at the field level to solve their marketing
problems which from the basis for the development of the promotional strategy at the corporate level .There are

32
different programs to satisfy different target groups of customers .The promotional budget of CFL is . 80 laks
,i.e Rs 20 per tones of DAP sales .CFL allocates on the following promotional programs .

Squad programs

The objectives of squad program is to generate consumption of coromandel brand fertilizer

and position the product in the market . It is implemented before the commencement of the season and
continues till application of complex fertilizer .It is implemented in the potential villages around the markert .

 Field assistance meet the farmers and distributes literature and educate them to use coromandal
products .

 Marketing officer to lead them - supervise and attend to customer complaints and meeting opinion
leaders ect .

 Inform and involve dealers when ever possible.

1. Farmer seminar

To generate goodwill of the farmers and agri extension agency towards coromandal brand fertilizer and
the company .it is preferable when the farmers are facing crop management problems or there areas
complaints regarding Coramandel products. It is implemented in a village where area specific problem
exists.

 Informing villagers about the seminar at least one day in advance.

 Act more as a facilitator than the conductor of the program.

2. Exhibition:

33
 To popularize Coramandel brand among the farmers. It is implemented in the annul day of agri research
station, kisanmela, festival day, farmer’s day etc.

 Keep ready literature, product bags in the book exhibition stall by paying rent in advance.

 Involve monthly filed assistance and trainees in the program

 Provide the services to the fanners.

3. Dealer meeting:

To build and develop positive trade relations with the dealers. It is implemented 15-30 days before the
commencement of the season. It is implemented at RMO head quarters or a place convenient to most of
the dealers.

 Submit item wise budget break up and take approval

 Includes question and answer session.

4. Sponsored Programmes:

To generate goodwill of agri department / district / administration.

 Informing villagers about the seminar at least one day in advance.

 Act more as a facilitator than the conductor of the program

It was found that when there is a raise in the prices of fertilizer, the sales will be decreased to a small extent.
But due to the existing brand image, and the compulsory usage of fertilizer to the corps, some fanners are
buying the fertilizers even when the price is high and some of them are shifting to the other brands which are
available at a relatively low cost. Also during the survey, it was found that the wholesalers due to the
availability of cash discounts for large quantities of product, they are selling the fertilizer at a relatively low cost
than the dealers do. Since the dealers do not opt for a large quantity they have to seal the fertilizers at high price
than wholesalers. It was also found that the Coramandel brand fertilizers are relatively at a high cost as

34
compared to the remaining brands of fertilizers. The DAP and 20:20:0 are giving maximum benefit to the
dealers.

CFL’s advertising Techniques:

1.Audio Visual Van Programme:

 To create demand and consumption of Coramandle brand fertilizers by meeting and persuading farmers
in the villages. It is implemented any time through out the year in the villages where the value of
Coramandel brand is not realized.

 Marketing office in consultation with the dealers and identifies villages to be covered and submits the
list to Regional Manager.

 In the village, supervisor to meet fanners, give literature and urge them to use Coramandel Products.

2.Wall Paintings:

 To act as a product recall medium in the mind of fanners. It is implemented before the
commencement of the season in the state and panchayat roads, market yards, co-operative society,
cinema theaters, dealer’s shops, trolleys, lorry, and private businesss.

 Invite quotation from requested painters and obtain approval from corporate office, select places
and prepare the list.

 Hand over the designs and list of locations to supervise quality of work and its progress.

3. Slide Screenings:

35
  To recall Coramandel brand fertilizers in the minds of farmers. It is implemented 15 days before
the commencement of season to continue till application of complex fertilizer continues. It is
implemented in theaters which have slide productions.

 Select list of theaters, pay screening charges and hand over slides.

 Specify the slides to be projected.

4. Wall Posturing, Metal plating, Stenciling: To inform the fanning community about the benefits of
application of Coramandel Brand fertilizers to their crops. To appeal to the fanners to apply Coramandel
brand fertilizers. It is implemented 7 to 10 days before the commencement of season and continues till
application of complex fertilizers concludes. It is implemented in potential villages which has atleast
100 fanning households.

Emergency Responses:

Coramandel Fertilizers and Chemicals Limited, Kakinada is been implementing emergency responses right
from two management systems:

I. Process safety Management System (PSMS) ESPECIALLY FOR safety Management

II. Occupational Health Safety Administrative Services (OHSAS) especially for safety & Health
Management

These policies are been guided and undertaken by the SHE department of CFL, Kakinada.

Plant/Offsite Facilities:

 Manufacturing Di-Ammonium Phosphate (DAP) (18:46:0) and flexibility for production of

20:20:00:15 &NPK Grades like 7:17:17; 19:19:19:14:35:14; 12:32:16.

 Pesticide formulations unit for manufacturing 1200 KL per annum.

 Eco-friendly Bio-fertilize Unit.

36
The DAP plant is located in 730 acres of land at Kakinada with extensive Green Belt all around plant. The offsite facilities
are indicated below:

Original Plant Expansion Plant

Production Handling System Bagging Plant 8 x1200 Bagging plant with a Fully
Bag/Hr Bulk silo :25000 Mt Automatic Bagging Machine.
Capacity New Bulk Silo of 15000 Mt
capacity with a Scraper
Reclaimed.
Ammonia Storage 2 x 1500 Mt. Horton spheres 2 x 5000 Mt Atmospherics
Storage ship unloading
facilities with 2.5 KM cross
country pipeline.
S Acid Storage 1 x10000 Mt 2 x 5000 MT-2 x 12000 MY
and ship unloading facilities
with 2.5 KM cross country
pipeline

S Storage 2 x 250 KL

Sulphuric Acid storage Tanks 250 KL 4 X 1500 KL

Service Air & Instrument Air 2 Nos. reciprocation -

compressor capacity 650
Nm3/ HR Discharge
pressure 7.0
Kg/Cm2g
Boiler House Horizontally fired package -
Capacity : 6.0 MTPH at 10.5
Kg/Cm 2 g
Water Treatment Water – 9000 Cu.M Drinking -
Water-50 Cu.m

37
Quarterly Financial Results:

Unaudited Financial Results for the Quarter Ended 30th September, 2007

30.9.07 30.9.06 30.9.07 30.9.06 30.9.07

1. Sales/ Income from 90499.17 72968.09 107796.16 99519.11 180053.53
Operations
2. Other Income 159.67 51.43 248.29 92.29 300.29
3. Total Income (1+2) 90658.84 73019.52 108044.45 99611.64 180353.82
4. Expenditure

a. (Increase)/ 3927.630 18254.24 5892.32 2385.71 (1061.18)

Decrease in
Stock in
Trade
b. Consumption 36539.24 39146.44 78827.58 76558.53 146123.44
of Raw
Materials
c. Purchase of 2241.14 4219.15 2531.62 4338.61 5451.36
traded goods
d. Employee 540.67 536.64 1110.84 1221.67 2337.76
Cost
e. Depreciation 179.85 165.73 365.66 328.41 665.05
Other Expenditure 3762.26 5018.97 8155.35 8650.00 15807.57.
f. Total 82539.46 67368.16 96883.37 93482.93 169324.00
5. Interest 658.09 720.20 1696.04 1573.57 3590.88
6. Exceptional Items 0.00 0.00 0.00 0.00 0.00
Profit (+)Loss
(-)from Ordinary
7. Activities Before tax 7461.29 4931.16 9465.04 4555.14 7438.94
(3) –(4+5+6)
8. Tax Expense Net 2590.00 1630.00 3296.50 1636.14 2510.00
Profit (+) Loss (-)
from
9. Ordinary Activities 4871.29 3301.16 6168.54 2919.00 4928.94
after tax (7-8)

38
10. Extraordinary Items 0.00 0.00 0.00 0.00 0.00
(net of tax expense)
11. Net Profit (+)/Loss 4871*29 3301.16 6168.54 2919.00 4928.94
(-) for the period (9-
10)
12. Paid – up Equity 3200.00 3200.00 3200.00 3200.00 3200.00
Share Capital (Face
value Rs.10/- per
Equity Share)
13. Reserves excluding 10222.49
Revaluation
Reserves as pr
balance sheet of
previous accounting
year
14. Earnings per Share 15.22 10.32 19.28 9.12 15.40
(Rs.)-Basic and
Diluted (Not
annualized)
15. Public shareholding 8024788 9576748 8024788 9576748 9576748
Number of shares
Percentage of
shareholding

The Board of Directors of Coramandel Fertilizers and Chemicals Limited (CFL) (a Murugappa group
Company) today has approved the audited financial results for the year ended 31m March 2007.

CFL reported an impressive performance during the year 2006-07. This is the fourth successive year of
profitable growth since its take over from Government of Andhra Pradesh in July 2003. Continuous efforts of
the management on all fronts have benefited the Company’s operations were affected by

 Shortage in phosphoric acid

 Delay in receipt of subsidy

39
  Non reimbursement of freight increases

To achieve a reasonable return in this business the Company has appealed to the Government to expedite release
of subsidy payments and reimburse the actual increase in freight cost. The Company has set new milestones and
production volume touched all time high record 11.35 lac MT (previous year 10.24 lac MT). At the time of
takeover of the Company in 2003, production was 7.43 lakh tones. Higher production was achieved by de
bottlenecking and process changes, without any major capital expenditure during the last four years. Higher
productivity has been accompanied by significant improvement in efficiencies of raw material and energy
usage.

Sale of manufactured products was 11.28 lac MTs (previous year 10.20 lac MT). The Company’s realization
from sale of products has improved significantly on account of better logistic management, increased market
share in addressable markets and tight control over distribution costs.

Sales turnover increased by 18% to Rs. 1,800 crore (previous year Rs. 1,520), During the year, the Company
has entered and strengthened its market presence in water soluble fertilizers, micronutrients and G-Sulphur
which are complementary to the DAP and complexes manufactured and marketed by the Company. The
Company has a wide retail dealer network comprising of over 8000 dealers in 6 States.

Innovative schemes launched by the Company to support rural Girl child education an to recognize best
practices adopted by farmers (Rythu Puraskaram) have been widely appreciated by government agencies as well
as the press and media.

 EBITDA achieved for the year Rs. 116.95 crore (previous year: Rs. 68.32 crore) was higher by
71% . This is an all time high since the Company’s inception in 1981. Interest and Depreciation
accounted for Rs. 35.91 crore (previous year : Rs. 1831 cr) and Rs. 6.65 crore (previous year :
Rs.7.89 cr), higher interest rates have adversely affected the Company and also the industry as a
whole.

 Earnings Before Tax improved consecutively for four years in a row to Rs. 74.39 crore (previous
year Rs. 42.03 cr) recording an increase of 77%.

40
  The Company had reported a loss of Rs. 20.24 er at the time of acquisition in 2003. Provision for
Taxes stood at Rs. 25.10 crore (previous year : Rs.15.93 crore) and Profit After Tax increased by
89% to Rs. 49.29 cr (previous year Rs. 261.11cr). Earning per Share significantly increased to Rs.
15.40 (previous year Rs. 8. 16).

 The Board has recommended payment of dividend at 40% (previous year 20%).

New Projects:

 A New ammonia storage tank of 10,000NT capacity was commissioned during the year at a
cost of Rs. 19.25 crore. This would augment the ammonia storage capacity and reduce
procurement cost.

 During the year, the Company has migrate to an improved ERP System (SAP 4.7 Enterprise
version) and has also automated the frontline sales transactions.

 During the year, the Board has approved an expansion project at an estimated cost of Rs.82
crore to increase the production capacity by 4.25 lakh tones. The project proposal received
support from all quarters, including environmentalists, at the public hearing conducted by
APPCB. The proposal is pending before the Ministry of Environment &Forests, Government
of India. This project is expected to be commissioned during early 2009.

Increase in stake by Murugappa Group:

Coromandel Fertilizers Limited (CFL), part of Murugappa Group, has increased its stake in the Company from
45.07% to 74.92%, by acquiring IFFCO’s shareholding in the Company and also from public through an Open
Offer under SEBI Takeover Code.

41
42
 Chapter 4
Theoretical Framework

Theoretical Framework of Distribution Channel

Distribution Channels are probably the most visible aspects of any companies marketing efforts. A recent estimate puts the
number of retail outlets in India at 5 million. The retail industry provides livelihood to more than 15 million people in the
country. Distribution decisions are critical in nature as they effect the visibility of the firm and the product. The decisions
affect the market share of the firm and the product. The decisions affect share of the firm, Hence great care has to be taken
in selecting distribution alternatives.

43
Before the product is marketed, the management should determine the ways which will be used to send the product to the
market. This means establishing strategies for product distribution. Distribution channel is the first part of market mix.
Managing an Attribution channel often begins with a procedure. Distribution Channel comprises a group of people
and firms involved in the transfer of title of ownership, as the product moves from producer to the ultimate
consumer or buyer. If one included in this number of distributors, Wholesalers, Agents including the army of
life insurance of products and services to the end consumers, one might end up with a mind boggling number, in
its contribution to the economy its sector is far too significant role of this sector, the net contribution in terms of
critical services it renders to the society cannot be ignored, While the manufacturing sector is always given the
credit for accelerating the rate of economic growth and encouraging developmental activities. What is often
ignored is the indispensability of the distribution sector in sustaining the manufacturing sector.

The distribution function is tremendously undergoing changes in terms of both its span and productivity. as it
already happened in the case of manufacturing activities. Modern technology is fast transforming this sector
beyond recognition. The focus of all these segments is increasing the convenience to the end customer either by
increasing the number of benefits or delivering the benefits at a lower rate. The internet has enabled
manufacturers to perform several distribution related activities without the need for employing intermediaries.
The distribution channel is "The structure of intra company organization units and external company agents,
dealers, wholesalers and retailers through which a commodity , product or service is marketed" .
Distribution channel is "a set of independent organizations involved in the process of marking a product or
service available for use of consumption". Thus the distribution channel in the marketing system seeks to satisfy
the needs and wants of target users and objectives of various parties involved. A particular channel extends to
the point till significant changes are made to the product form.
Example:

When wheat is reaped from the farms the distribution channel is different, but when it is grounded into flour the
product form then the channel requirements will also differ. Thus a different type of distribution channel comes
into existence.

The channels for wheat will be:

FARM MIDDLEMAN FLOURMILL

The channels for Flour mill will be:

FLOURMILL RETAIL OUTLET CONSUMER

44
Other intermediaries that can participate in the distribution channel are banks, insurance companies, storage
firms, warehouses and transportation companies. But as they do not take or ownership of the goods they are not
formally considered as the distribution channel.

Distribution channel strategy:

While he need for intermediaries that perform functions that help in bridging the inevitable discrepancies
caused due to the typical way in which manufacturing is carried out as well as the way in which consumption
takes place is clear, the importance of a clear cut channel strategy in a firm's marketing strategy has to be
emphasized. The channel strategy assumes critical importance since a firm has to consciously plan and
implement the most efficient process by which the discrepancies can be bridged.
A company's distribution strategy involves the strategic choices that the company makes in the realm of
organizing and managing the distribution function for achieving the objectives set forth in the overall strategy,
which in turn forms part of the business strategy. The major domain across which distribution strategy is framed
includes the following:
 Setting distribution objectives in terms of customer requirements.
 Finalizing the set of activities that are required to be performed to achieve the channel objectives.
 Organizing the activities so that the responsibility of performing the activities is shared among the
entities.
 Developing policy guidelines for the smooth functioning of the channel on a day to day basis.

Physical distribution:

The marketing concept calls for praying increased attention to the physical distribution is an area of potentially
high cost savings and improved customer satisfaction. hence order processors, Warehouse planners, Inventory
managers and transportation managers make decisions. They effect each other cost and demand creation
capacity. The physical distribution concept calls for treating decisions within framework.
The task becomes that of designing physical distribution arrangements that minimize the total cost of providing
a desired level of customer service. The physical distribution attempts to procure the right inputs, convert them

45
into furnished products and dispatch them to the final destination. Every company has to store finished products
until they are sold, because production and consumption cycles rarely match the storage functions , helps to
smooth discrepancies between production and quantities desired by the market. The company must decide on
the number of stopping locations. Warehouses store goods for moderate to long periods of time. Distribution
warehouse receive goods from various company plants and suppliers move them out.
Marketer needs to be concerned with the transportation decisions. Transportation choices will affect product
pricing on time delivery performance and condition of goods when they arrive, all of which will affects the
customer satisfaction. The modes of transportation can be through rail and road (Trucks).
The import of raw material is done through seaways.

Need for physical distribution:

Reasons for management's interest in physical distribution are many but the most significant are listed below:

Top
Management

Production Marketing & Sales Finance & Control

 Plant Location  Depot location &  Investments in

operation investors
 Factory
Warehousing  Depot Stocks  Operational
research
 Factory Stocks  Sales forecasting
 Cost analysis
 Factory  Channels of
Transportation Distribution  Order 46
Processing
 Out Bound Traffic  Delivery Transport
protective
Management conflicts:

Traditionally before the physical distribution concept came to existence companies allotted sub-functions to all
departments. The hierarchy and their functions were more or less like the one depicted in the above figure.

Physical distribution management structure:

Production department like to minimize production cost by having outputs at a constant rate by sending as much as
possible out to the depots. Sales department prefer to have stocks at times of high demand and certainly never run out of
stocks. They like to have a large number of outlets so as to give best service to the customers.

Finance and control likes to reduce all round cost and the investment required in the form of stocks of all kinds. The
overlapping activities of different interests, often lead to conflict within the organization. Chief executives were required
to intervene from time to time to resolve the disputes.

Role of middlemen/intermediaries:

Besides making the product available to the customer, middlemen perform several roles and functions which are
mentioned below.

1. Information:

47
 Middlemen have a role in providing information about the market to the manufacturer. Developments
like change in customer demography, psychograph, and media habits, entry of a new competitor or a
new brand and changes in customer preferences are some of the information manufacturers need.

2. Price stability:
Maintaining price stability in the market is another function a middlemen performs. Many a time he
absorbs an increase in price of the product and continues to sell with the same old price because of the
competition. He also maintains the price stability by keeping his overheads low.

3. Promotion:
Promoting the product in their territory is another function that a middlemen perform. Many of them
design their own sales incentive programmes aimed at building customer traffic at their outlets.

4. Title:
Most of the middlemen take the title to the goods, services and trade in their own name. This helps in
diffusing the risk between the manufacturers and the middlemen.
This also enables middlemen to be in physical possession of the goods, which in turn enables them to
meet customer demand at the very next moment.

5. Financing:
Middlemen finance manufacturers operations by providing the necessary working capital in the form of
advance payments for the goods and services. The payment is in advance even though credit may be
extended by the manufacturer, because it has to be made even before the product are bought, consumed
and paid by the ultimate customer.
Thus the role and functions of any marketing channel can be viewed from different perspectives or
marketing flows as shown below.

The new role of intermediaries:

The role of intermediaries is undergoing at a rapid change. It is impacted by internet and mobile communication
technologies, intermediaries find that their conventional role of selling the goods in their possession and

48
 competing on the basis of price does not hold good any more. They are also realizing that they can no longer
afford to remain content by satisfying the needs of an average customer. Today since the customer can access any
intermediary anywhere in the world the middlemen role is to compete on the basis of experience customer has
with the service. Hence the middlemen have to have access to the full range of products and services required by
the customer. In view of the intensity of rivalry in the distribution channels each middlemen will have to do a cost
driving. The intermediaries should also enter up into strategic tie-ups with the firms who are complementary and
hence can help to expand the electronic network so as to deliver a total customer experience.

Type and nature of middlemen:

There are three types of middlemen that facilitate the flow of

goods and services from manufacturers to the end customers.

 Merchant middlemen:
These are the intermediaries who take title of goods and services and resell them. We know them
as dealers, wholesalers and retailers. These middlemen get margins and bonuses as
compensation. They share the rise with manufacturers when they take title and physical
possession of the goods.

 Agents:
These are intermediaries who do not take the title of the goods and services but help in
identifying potential customers and even in negotiations. The typical example is that Container
and freight agents, Brokers and jobbers who act on behalf of the producer only to the limited
extent of processing, warehousing and re-distributing the products. They do not share risk with
the manufacturers as they do not take the title to the goods and services. Agents earn commission
and are reimbursed for all expenses by the manufacturer.

 Facoromandelitators:

49
 These are independent business units that facilitate the flow of goods and services from the
producer to the customer without taking a title to them or negotiating for them on behalf of the
producer. Transportation companies, banks and independent warehouses are examples of
institutions. These institutions are paid for their services as in the case of transporters who charge
freight, banker who is paid for the service for documentation, warehouses who charge as rent for
holding the goods.

 Pre-sale services:
The main purpose of pre-sales service is to assist customers for good planning and system
requirements analysis, making the products to the maximum to meet user needs, while also
enabling customers to play the greatest investment in overall economic efficiency.

 Post sale services:

Channel members facilitate exchange by understanding tasks such as transporting goods to their
ultimate destination and distributing money to different systems in the organization. Also
intermediaries provide after sale services and installation to the customers on behalf of the
producers.

Types of channels:
Ideally a manufacturer selling a product in the market will require 3 types of channels to perform these
functions:
Sales channel: This is used to perform motivational, informational, bargaining and finance functions.
Delivery channel: This involves transfer of physical products i.e. possession of the product.
Service channel: This channel performs after sale services. Here we can express mail services as
delivery channel and local offices as services channel.

Channel functions:
Explicitly stated, channel works as a means of moving goods from producers to consumers. It
overcomes time, place and possession gaps and provides goods and services to the people who need.
Main functions performed by the channel are:

50
  Information gathering:
Information about potential and current customers, their behaviour, competitors and other forces
which affect the business are gathered by channels.
 Consumer motivation:
Channels develop and disseminate persuasive communication to motivate consumers in buying the
product. Being in direct touch with the consumers and know their pulse.
 Bargaining:
They reach agreement on price and other terms with the consumer on behalf of the producer so that
transfer of ownership can take place.
 Placing orders:
Intermediaries place orders with producers on behalf of consumers, for the products they need. Later
they sell these products to the consumers on terms acceptable to the producers. Thus they bridge the
gap between producers and consumers who are extremes.
 Financing:
Intermediaries finance inventories at different levels of marketing channels. They provide funds to
the producers by decreasing the time required to convert inventory to cash.
 Risk - bearing:
Intermediaries also share risks connected with carrying out channel work thereby reducing the
burden on the producers
Inventory control:
Intermediaries also provide successive storage facilities and movement of physical products to the
producers. This enables a producer to redirect their limited factors of production towards other
systems.
 Services:
Intermediaries offer specialized product services, including repairing service to the customers on
behalf of the producers.

Channel Structure
It consists of a number of outlets that may be adopted in moving the product from manufacturers to
consumers. It can be illustrated as:

51
  Direct Channel: A company may undertake to distribute its goods to customers or retailers involving
any intermediaries. This is referred to as a direct channel which constitutes the shortest channel of
distribution process. Manufacturers in this case do not rely on intermediaries. They directly reach
customers to sell their products.

MANUFACTURERS CONSUMERS
Indirect Channel: Goods may pass through one or more intermediaries such as wholesalers or agents.

MANUFACTURERS RETAILERS CONSUMERS

Sometimes there may be small retailers who rely on wholesalers for bulk amount of goods to be sold to
consumers requiring smaller quantities at the retail outlets. Here the channel constitutes.

MANUFACTURE WHOLESALER RETAILERS CONSUMERS

MANUFACTURERS AGENTS WHOLESALERS RETAILERS CONSUMERS

Here Agents mediates between the farmer and the wholesaler.

Distribution channel do not remain the same. In today dynamic environment new wholesaling and
retailing outlets emerge and thus new channel systems evolve.

 Vertical Marketing Channel: One of the most significant recent developments is the rise of vertical
marketing system. In conventional channels which comprise of direct in direct distribution methods,
none of the channel members has complete or substantial control over other members. In other
words independence of the channel members was more important in these channels. A VMS on the
other hand includes parties like Wholesalers, producers and retailers acting as a unified system.
 Horizontal marketing system:

52
 In this channel two or more unrelated companies join together so as to have pooled resources to
exploit an emerging marketing opportunity. This system takes place when a company lacks capital
and knows
 Multi-channel marketing system:
In the past many companies sold to a market through a single distribution channel. Today more and
more companies have started adopting multi-channel marketing system. Multi-channel marketing
occurs when a company uses different channels to reach same or different market segments. This is
done to ensure availability of right product at the right time to the right customer. It is used when
same product is sold to different markets; unrelated products are sold within a single market.
Thus this system is nothing but a channel which is adopted and changed according to the
characteristics of the consumer to ensure maximum satisfaction to the consumers. Though these are
main types of distribution channel, advances in information technology have opened up the virtual
world where the distribution channels are completely different which has to be considered.

Channel levels:

The producer and the final customer are part of every channel. We will use the number of intermediary
levels to designate the length of a channel. The below figure illustrates several consumer goods
marketing of different lengths.

Distribution Channels in Coromandel International Limited

COROMANDEL is one of the leading fertilizer industries in Andhra Pradesh with a good market share.
During our survey we have observed that the company has effective distribution channel all around
Kakinada. The project is mainly concerned with the distribution, its channels functions and procedures
adopted in the distribution of the product also the intermediaries involved and its levels.
The mode and means of transportation, storage capacity and warehouse includes the clear cut as
distribution channels have greater impact on the purchase decision of the consumerHere it is also
Provided that the inventions in technology regarding the distribution and order processing right from the

53
 customers. This has been treated as the investigation to find out the systematic collection of data about
the marketing network and channels of distribution of CFL products
Distribution Channel is the structure of intra company organization units and extra company agents like
Dealers, Wholesalers and Retailers through which a commodity, product or service is marketed. The
channel of COROMANDEL includes Producers, Retailers, Wholesalers and Traders. In addition to this
it also includes Institutions such as Mark Fed and Agros, Cooperatives such IFFCO (Indian Farmers
Fertilizer Corporation) and KHRIBCO. Here the Distribution Channel in the marketing system seeks to
satisfy the needs and want to target users and objectives of various parties involved. The basic objective
of the distribution channel of COROMANDEL is to make services available at right time and at the right
place and accessible to consumers with ease and convenience. All characteristics of service
(Intangibility, Inseparability, Variability, perishability, customer participation and no ownership)
influence the distribution channel of COROMANDEL

The intermediaries that can participate in COROMANDEL are banks (Which provide the policies the
subsidy of the government and financial transactions) Insurance Companies(Which provide the policies
to the employees and customers) Storage Firms(SAILOS which store 25,000 M.T capacity of the
product in Raw form) Warehouses which are been rented by the company at various places in Andhra
Pradesh and Transportation Companies which provide the contractors to transport the finished product to
the customers either through Ex works or F.O.L ( Free on Lorry).

Role of intermediaries in COROMANDEL

Besides making the product available to the customer, middlemen perform several other roles and
functions.

 Providing information about the market to the manufacturers. They all provide information regarding
the changes in customer demography, psychograph, media habits, entry of new competitor or new
brand and changes in customer preferences to the manufacturer.

54
  The middleman performs the function of maintaining the stability in price in respect to the subsidy
provided by the government of India, Fertilizer Association.

 They provide the promoting of the new product in their territory.

 They increase and use the title of goods, services and trade in their own name. This helps in diffusing
in diffusing the risks between the manufacturers and middlemen. This also reduces between the
manufacturers to be in physical possession of goods.

 The function of intermediaries is fast undergoing change is to maintain mobile communication and
internet communication with the customer as well as manufacturers regularly. With the invention of
technology the customer also can access the intermediary anywhere in the world.

Functions of distribution channel in COROMANDEL

Explicitly stated Channel works as a means of moving goods from producers or manufacturers to the
customers. It overcomes time, Place Possession gaps and provides goods and services to the people who want
them. The main functions performed by channel are:

 Gather information about the potential and current customers their behaviour competitors and other
forces which affect the business.
 The channel motivates the customers by persuasive communication in order to buy the products. Being
in direct touch with the customers they know what exactly the customers need.
 The channel place orders with the marketers on behalf of the customers for the products they need.
 Channel also shares risks concerned with carrying out channel work there by reducing the burden of
the marketer.
 Channels offer specialized services such as free soil testing with permission of the manufacturers.

55
 Functions of distribution channel in COROMANDEL

Customer

Retailer

Wholesaler

Warehouse

Customer Customer

Manufacturers

Dealer/Wholesaler Retailer

Dealer Retailer Customer

Physical Distribution in COROMANDEL

The marketing concept of COROMANDEL completely calls for paying increased attention to the physical
distribution. It is an area of potentially high cost savings and improved customer satisfaction. Here order processors,
warehouse planners, inventory managers and transportation managers make decisions; they affect each other's cost and
demand creation capacity. This concept calls for treating these decisions within the unified framework.

56
 Commercial department
acquires Raw material

Production department
undergoes production to get
finished products

SAILO

Bagging Department bags the

product

Distribution Department
distributes the product on request
to dealer or warehouse

Marketing
Department

Warehouse or Dealer

Customer

Here the marketer needs to be concerned with the transportation decision. The transportation choices
will affect product pricing on time delivery performance and the conditions of goods when they arrive
all of which affects customer satisfaction. The modes of transportation can be through shipping right
from Senegal, Tunisia and South Africa. The whole material is acquired by the commercial department.
The physical distribution mainly performs the following functions:
Management conflicts allot Sub-Functions to various departments.
Rising costs to provide labor incentives, expect frequent deliveries.
Customer service explosion.

57
 Cost reduction opportunities.
An Aid for marketing.
Time constraints.

Distribution Process of Coromandel International Limited

At first the commercial department acquires raw materials required for the production. Then through the
conveyors the raw material is been carried directly to the manufacturing or production department. The
production department undergoes certain processes and produces the products according to the
preference to the customers. After the final product is stored in SAILO it is sent to the bagging
department through conveyors. The bagging department bags the required amount of product to be
distributed and stores the remaining product in SAILO.

The bagged product is sent to the distribution on request. The distribution department at first gets an
order from the marketing department of the required quantity and required product. Then the marketing
department place an order to the distribution department through the I-Pad provided to all the heads of
the department and then places an order for the bagging department. A distribution department verifies
the stock availability with the bagging department and then places and order for the bagging department.
The bagging department then sent to the distribution department a notification specifying the availability
of stock. Meanwhile several sample tests are been made to maintain the quality and quantity of the
product. The weighbridge also weighs the empty truck before loading and after loading to check whether
the required quality of product is correctly distributed or not.

Then the distribution department calls the contractors for the transportation of the finished goods either
to the warehouse or to the dealers. Then the dealers receive the goods provided directly from the
transporter and then supply the product to the required customers.

Functions of Distribution Department in COROMANDEL

 Transportation Management:

58
 Transportation is very essential in distribution. It is one of the expensive components of
distribution. It deals with a part of place utility and concerned with raw materials, semi-finished
goods and finished goods. They are mostly marketed through means of railways and roadways.
The distribution department allows the contractors to perform the function of transportation.
Here the transporter brings a truck and takes the goods to the destination and the company pays
to the transporter. This complete process is borne by the company and it is called FOL (Free on
Lorry).
Another process includes that the dealers send the truck to collect the required stock and they
take the product on their own fare. This is completely borne by the dealer and this process is
called ex works.
The company also distributes through railways where it hires wagons form the railway
department and transport the goods to the other states like Bihar , Maharashtra and Karnataka.
The transported product is been taken to the nearby destinations and the required dealers come
and collect the product through Ex works. Here the product is been sampled and correctly
weighed product is sent to the dealer else it is returned back to the SAILO for further
modifications. This transportation management is completely under the guidance of distribution
department and Bagging department.
Inventory management:

COROMANDEL usually believes that if too high inventory is maintained then they would result
in high risk of obsolesce. On the other hand it is too low to maintain inventory, then it would
result in high restocking. The inventory is been maintained in SILO. The company has two
SILOS with a capacity of 35,000 MT. The SILO is under the guidance of the production and
bagging department. The finished product is stored in SILO in Off- Season and the bagging takes
place in required quantities based on the requirement.

 Warehousing:

COROMANDEL generally refers to storing the products in un- season which are ready to be
distributed. Now-days the company is preferred to warehouses situated in places Vijayawada,

59
 Tadepalligudem, Kurnool and Cudadapah of Andhra Pradesh. This is monitored by distribution
and marketing department.

 Industrial packaging:

Packing is a part of the total distribution of the product. The bagging department entirely work
for the improvements in bagging techniques and has implemented technological equipment. The
bagging department consists of two plants and the bagging capacity of both the plants per day is
2500 Tones. The bagging department gets blank covers which are manufactured in Hyderabad
and Aurangabad along with the printing. The old plant is performed manually and due to the
advanced technology the new plant is automatically operated through computer (P.L.C) The
bagging takes the full care and concern towards the bagging of the product. They send samples to
the lab before the bagging is done and regular inspection done to maintain quality and if there is
found any problem the bags are sent for re-processing.

Material handling:

COROMANDEL adopts a perfect technique by issuing the bills colored yellow, pink and white.
When the transporter enters the company premises the security issues three colored papers
mentioning the name of the product quantity required and the destination. This is been
completely undertaken by the three heads one form distribution, one from the bagging and
another form the security department. Later the dealer checks from his end.

 Order processing:

Time to complete the activities of the order cycle is at a very heart of the customer service. It has
been estimated that the activities associated with order preparation, transmittal, entry and filling
represent 50 % to 70 % order cycle time in the industry. Due to the advancement in technology
the marketing head is been provided with I-PAD which is useful for placing an order online.
Here after the very second the marketing department place an order for the quantity of the
product it is been automatically updated in the system of the distribution department and the

60
 bagging department starts the process accordingly. this happens round the clock and throughout
the year.
When the bagging department sends the material it is updated automatically in distribution as
well as marketing department that is has sent the product.
This is entirely done on S.A.P (Software application).
The information about the potential market is gathered by the means of surveys and then the
product is brought into market. COROMANDEL has a wide range of dealers with whom the
product is available it is the complex fertilizer having the highest nutrient value of its grade with
18% Nitrogen and 46% Phosphorous. The marketing and the distribution network is fully geared
to meet the projected demand of huge stock of our products. Adequate warehouse facilities are
provided to ensure quick movement of stock from the buffer to achieve the defined marketing
objectives and farmers satisfaction

Corporate social responsibility:

COROMANDEL business is not limited to commercial profit alone. Its corporate responsibility does not
stop with merely increasing shareholders value. Coromandel associates with various community
development activities in the communities around its manufacturing facilities as well as in the markets
in which it operates.

CSR Initiatives:

 In support of the total community: Coromandel played a vital role in the construction of a super
specialty wing at St. Ann's Jubilee Memorial Hospital, Visakhapatnam by donating 60 lakhs rupees.
The hospital is a charitable institution located in the neighborhood of the Visakhapatnam plant,
catering to the medical needs of the underprivileged sections of the society. Equipment such as
dialysis unit, Ultramodern ventilators, laparoscope and portable X ray were also donated which
caters around 120 patients per month.
 Caring for flood victims: Coromandel donated Rs.10 million to chief ministers’ relief fund for
helping the flood victims of Kurnool and Krishna districts of Andhra Pradesh.

61
  Rural Girl Child Education Scheme: This award programme pioneered by Coromandel was
launched in April 2005.
 To reduce the percentage of rural girl child school drop-outs.
 to enthuse the rural girl child to compete for the award
 And to encourage them for higher education.
 TheRural child education scheme was initially introduced in Andhra Pradesh
Enthusiased by its success Coromandel the scheme to Karnataka, Tamil Nadu Orissa
and Maharashtra.
 Girl child who scores maximum from class IX are selected from the government and
ZillaParishad schools to receive an award towards their books, uniforms feeds and other
educational needs.
 Thanks to this initiative as more than 4300 rural girl students are back to school.

Recognizing Chemical Engineering Toppers:

In 1975 Coromandel instituted a Gold Medal for the best outgoing chemical engineering student from
Andhra University Visakhapatnam. the award was initiated to ;
 Establish and promote a tradition of industry and university interaction.
 Inculcate a spirit of competitiveness among students.
 Maintain a continued relationship with chemical Engineering students passing out of A.U.
The award comprises a 14 carat gold medal weighing 24 grams. Presented at the Annual National Symposium
organized by the Indian Institute of chemical Engineers. Waltair.
 Mega Medical Camps:
Coromandel conducts mega medical camps for the economically challenged people from the
neighboring villages surrounding its plants. The company organizes medically reputed specialties from
various fields and sets up multi- specialty camps through which more than 1000 people are benefited
from each camp.
 Coromandel Ennore team helps to clean up 1 km coast:
Coromandel Ennore joined hands with the Indian Marine Foundation and helped clean up a 1 Km stretch
of beach near Ennore plant. on 19-09-2009. Children and public also participated enthusiastically in this
activity.

62
 Chapter 5

DATA ANALYSIS AND INTERPRETATION

63
DATA ANALYSIS AND INTERPRETATION

1. Turnover per year (INR)

Turnover per Number of dealers % of dealers

Below 50 lakhs 12 20%
50lakhs – 1crore 36 60%
Above 1crore 12 20%

64
Interpretation:

The above chart indicates that majority of dealers are having turnover in the range 50lakhs- 1 crore.

2.` Duration period dealing with Coromandel International Limited

Years Number of dealers % of dealers

Below 10 years 4 7%
10 to 20 years 16 27%
Above 20 years 40 67%

65
Interpretation:

The above chart indicates that majority of the dealers are dealing with Coromandel International Limited for
Complex fertilizers Number of dealers %of Dealers more than 20
DAP 32 53%
10:32:32 14 23% years (67%)
10:26:26 8 13% and about 27%
Others 6 10%
have worked
for 10 to 20 years.

3.Various brands of complex fertilizers

Interpretation:
Among the six Complex fertilizers DAP and 17:17:17are mostly distributed by the dealers as they are widely used.

4..Dealers dealing with different companies

66
Brands Number of dealers %of Dealers
Coromandel International ltd 30 50%
NFCL 6 10%
PPL 6 10%
Zuari 6 10%
All 12 20%

Interpretation:
The above chart clearly indicates that Coromandel international limited has a major market share over its competitors and
dealers have chosen COROMANDEL due to the brand name, quality and the distribution network of COROMANDEL

5.Brands having high sales

Brands Number of dealers %of Dealers
Coromandel International ltd 30 50%
NFCL 6 10%
PPL 6 10%
Zuari 6 10%
All 12 20%

67
Interpretation:
The above chart indicates that among complex fertilizers, DAP has maximum sales. Dealers agree that DAP gives them
more benefits, the rest is 10:32:32 followed by 10:26:26.

6.Reason for buying COROMANDEL products

Factor Number of dealers %of dealers

Quality 8 13%
Supply 6 10%
Service 16 26%
All the above 30 50%

68
Interpretation:

The above chart shows that the dealers are feeling factors such as quality, supply, service are major aspects for buying the
COROMANDEL products, Majority of them feel that COROMANDEL is having all these mentioned qualities.

7.Main source for information

Source Number of dealers % of dealers

Television 10 16%
Radio 8 13%
Internet 2 3%
Word of mouth 40 67%

69
Interpretation:

The above chart indicates that word of mouth is a strong means of communication and prominent source for information
among the dealers regarding the COROMANDEL and its products.

8.Sales Representative visit

Period of visit Number of dealers % of dealers

Before supply 10 16%
After supply 28 23%
Regularly 36 60%
Never 0 0%

70
Interpretation:

This chart clearly indicates that the sales persons are visiting the dealers regularly. They are explaining the new products
and collecting feedback from the dealers.

9.Means of transport
Means of transport Number of dealers %of dealers
Road 58 97%
Rail 2 3%

71
Interpretation:

This chart clearly indicates that although the distribution/ dispatch is carried out majorly through railways, the distributors
are getting the stock through roadways.

10.Market problems regarding COROMANDEL

Problems Number of dealers % of dealers
Supply related 16 26%
Quality related 0 0%
Waiting 10 16%
No issues 34 57%

72
Interpretation:

The above chart shows that dealers are experiencing some supply related problems. This is due to the demand and low
supply. Majority of them had no issues regarding COROMANDEL products.

11.Transportation charges

Type of charge Number of dealers % of dealers

EX (includes fright charge) 10 16%
FOL (Free on lorry) 50 84%

73
Interpretation:

COROMANDEL is providing majority of their dealers with FOL (free on lorry), so that their transportation cost is
minimized.

12.Promotional programs
Promotional programs Number of dealers % of dealers
Highly satisfied 44 73%
Satisfied 10 16%
Normal 6 10%
Dissatisfied 0 0%

74
Interpretation:

The promotional programs carried out by COROMANDEL highly satisfy the majority of dealers. 16% of the
dealers are satisfied and the rest of them are unaware of the promotional programs as they are not dealing the
COROMANDEL products.

75
Chapter 6

76
 Findings

 There is a heavy competition in the fertilizer market.

 The performance of the company in the area of complex fertilizers is very good, especially manufactured
DAP. At present COROMANDEL has a near monopoly in the area of DAP
 The entire distribution pattern of the company is very good and effective and hence it suggests that the
company will continue to have a good brand name and a brand image which in turn would reflect in
sales figures in the future.
 It is also observed that increase in price does not affect the demand and supply of the product
 Most of the farmers are purchasing the fertilizer due to existing brand image and demand. In respect to
complex fertilizers, COROMANDEL DAP earns the maximum benefit to dealer, farmer and the
company.
 Railways are the major means of transport.
 Distribution of the ordered product is done through rail rakes. Dealers then move the products to their
outlets by road ways.
 Transportation costs have a heavy impact on the price of the product.
 Some of the problems that were found are, bad and not stitched bags due to manual errors, presence of
sand and other foreign particles in the bag, non- uniformity of Colour of granules; but all the problems
are too minute and can be reduces on a day to day basis.
 The company is promoting the products like zinc along with DAP which lays a dissatisfied path to dealers
for enjoying their sales and profits
 The company tries to reduce the distribution cost by shifting fertilizers to and from plants like
COROMANDELVisakhapatnam etc.
 The company is also involved in many CSR initiatives which is doing well for the society.

77
 Suggestions

In view of the best performance of the company in terms of sales, availability of product, being the most
preferred company for business by the dealers the following suggestions can be made:
 Heavy publicity in all the villages and agricultural areas so that people are more aware of the brand and
how the product is good for their plants.
 Creating awareness among people and farmers about Coromandel's retail stores (ManaGromor Center)
and benefits associated with retail stores.
 It should try and stay ahead of others by constant improvement in service, communication and
maintain relations with the dealers associated with COROMANDEL
 Field assistants should be appointed in order to explain the features of various complex fertilizers and to
increase the sale of other products along with DAP
 Stitching of the bags should be improved
 Establish the company owned warehouses in order to store the bagged products.

78
 Conclusion

Coromandal International Limited has a good brand name and brand image associated with the company
and also has a good dealer network into vast areas of AP and outside AP. COROMANDEL is a leading
organization in the production of complex fertilizers. The company popularized the DAP product with the brand
name “Coromandel DAP”. It continues to maintain its primacy in DAP sales in India.
The Coromandel DAP is marketed in Bihar, Maharashtra, Uttar Pradesh, West Bengal and Karnataka.
The equity shares of this company are listed in stock exchanges of Hyderabad, Chennai, New Delhi, Mumbai
and Ahmadabad.
The welfare facilities to the employees are quoted satisfactory. The pricing strategies and the
promotional programs are being well organized by the marketing managers.
The main aim of COROMANDEL- “One shop farmer’s stop” has been fulfilled to a large extent by
providing all the products required to the farmer under a single roof through Mitra outlets. By using some
special competitive strategies, a giant like Coromandel International Limited can withstand any number of
schemes undertaken by any new arrivals in the market.

79
 Bibliography

 Marketing Management...... Philip Kotler, Kevin lane Keller.

 Sales and Distribution.......... Tapan K. Panda, Sunil Sahadev.
 Annual Reports.................... Govt. of India, Department of fertilizers.
 Distribution Statistics.
Websites:

 www.coromandel.biz

 www.indianfertilizer.com

 http://www.iffco.coop/

 www.moneycontrol.com

80
 ANNEXURE

Questionnaire

1. What is your turnover per annum? (INR)

a. Below 50 lakhs

b. 50 lakhs – 1 crore

c. Above 1 crore

2. How long you have been dealing with CIL?

a. Less than 10 years

b. 10-20 years

c. More than 20 years

3. What brands of complex fertilizers do you sell?

a. DAP

b. 20:20:20

c. 17:17:17

d. 28:28:0

e. 10:26:26

f. 14:35:14

81
4. What are the major companies you are dealing with?

a. CIL

b. NFCL

c. PPL

d. Zuari

e. All

5. Which brand is having high sales at your store?

a. DAP

b. 10:32:32

c. 10:26:26

d. Others

6. The reason for buying the fertilizers of CIL?

a. Quality

b. Supply

c. Service

d. All the above

7. What is the main source of information regarding the fertilizers of CIL?

a. Television

b. Radio

c. Internet

d. Word of mouth

82
8. When usually the sales person visit you?

a. Before supply

b. After supply

c. Regularly

d. Never

9. What is your major means of transport?

a. Road

b. Rail

10. Do you find any market related problems regarding CIL?

a. Supply related

b. Quality related

c. Waiting

d. No issues

11. How are transportation charges offered by CIL?

a. EX

b. FOL

12. How about the promotional programs?

a. Highly satisfied

b. Satisfied

c. Normal

d. Dissatisfied

83