GVR Infra Projects Limited

Title: Asset Management Group –

Standard Operating Procedure

SOP Number: AMG-001 Version:

1.0.1

Asset management can be defined as the:

“systematic and coordinated activities and practices through which an

organization optimally and sustainably manages its assets and asset systems,
their associated performance, risks and expenditures over their life cycles for the
purpose of achieving its organizational strategic plan”

Where an organizational strategic plan is defined as the:

“overall long-term plan for the organization that is derived from, and embodies,
its vision, mission, values, business policies, stakeholder requirements,
objectives and the management of its risks”

Effective implementation of asset management requires a disciplined approach

which enables an organization to maximize value and deliver its strategic
objectives through managing its assets over their whole life cycles. This includes
determination of appropriate assets to acquire or create in the first place, how
best to operate and maintain them, and the adoption of optimal renewal,
decommissioning and/or disposal options.

1. Vision of AMG

1.1 GVRIPL’s Vision states:

To attain a pre-eminent status in the infrastructure sector, both in

India and abroad, by delivering world class infrastructure services of
all hues.

1.2 This is supported by the Asset Management Group’s Vision

To use a Total Life Cycle approach to plan for, create or acquire, maintain,
operate, rehabilitate, replace or dispose of physical assets to ensure a
required service delivery in the most cost effective manner and at the
optimum level, for present and future projects.
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 Title: Asset Management Group –
Standard Operating Procedure

SOP Number: AMG 001 Version:

1.0.1

2.The need for creating asset management group (AMG)

2.1 The assets are core to an organization’s purpose, such as Infrastructure

building, power stations, railway or road systems, buildings and airports.
An asset management system is therefore vital for organizations that are
dependent on the function and performance of their physical assets in the
delivery of services or products, and where the success of an organization is
significantly influenced by the stewardship of its assets.

2.2 Delivering the best value for money in the management of physical assets is
complex and involves careful consideration of the trade-offs between
performance, cost and risk over all stages of the assets’ life cycles. There are
inherent conflicting factors to manage, such as short-term versus long-term
benefits, expenditures versus performance levels, planned and unplanned
availability, or capital costs versus operating expenditures.

2.3 An integrated asset management system is therefore essential to

coordinate and optimize the diversity and complexity of assets in line with
the organization’s objectives, priorities and chosen risk profile.

3.Formation of the Asset Management Group (AMG)

3.1 The AMG was carved out of the GVRIPL as an independent functional
unit within GVRIPL in May, 2009 under the leadership of Mr. K L K Mohan,
Director with about 30 Years of experience in the various facets of the
infrastructure industry.

3.2 The main objectives in formation of AMG as an independent functional

unit as envisioned by the Board of Directors is as under:

3.21 To promote harmonious working relationship between the AMG

and Projects.

3.22 To managing the assets centrally for effective deployment and

maximizing utilization

3.23 To make the required assets available in time to the

projects (Availability)

3.24 To keep the assets in acceptable and Fit-for-Use condition

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(Effectiveness)
 3.25 To do it for the least cost (Efficiency)

Title: Asset Management Group

– Standard Operating
Procedure

SOP Number:AMG- 001 Version: 1.0.1

3.26 To keep the Project Managers focused on their core areas of execution of
the work in terms of Quality, Quantity, Cost and Schedule without any
distraction with the multitude of the problems associated with asset
management.

3.27 To march ahead with the technological advancements

3.28 By employing best business practices and maximizing the functional and
financial value of our capital assets through strategic acquisitions, allocations,
operations, and dispositions, AMG will also continue to ensure that all capital
investments are based on sound business principles and — most importantly
— meet GVRIPL’s Plant & Machinery / Vehicles needs.
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3.29 The AMG establishes, implements and maintains process(es) and/or
procedure(s) for the implementation of its asset management plan(s) and
control of activities across the whole life cycle, including:

• creation, acquisition or enhancement of assets;

• utilization of assets;
• maintenance of assets;
• decommissioning and/or disposal of assets.

Title: Asset Management Group –

Standard Operating Procedure

SOP Number: AMG-001 Version: 1.0.1

4 Asset Portfolio

4.1 The Asset Portfolio comprises the complete range of assets and asset
systems owned by GVRIPL. The asset system is a set of assets that interact
and/or are interrelated so as to deliver a required business function or
service.

4.2 The asset portfolio consists of a wide spectrum of state-of-art Civil

Engineering Construction Plants, Machinery and Vehicles, such as

4.21 Plants
4.22 Compactors
4.23 Excavators
4.24 Loaders
4.25 Graders
4.26 Pavers
4.27Tippers
4.28Utility Vehicles

The current major asset base of GVRIPL stands at Rs. 104 Crores comprising of
586 major P&M/Vehicles.

5 Major Assets – At a Glance

P & M / Vehicle Quantity Available

Auto 3-Wheeler 1
Baby Roller 7
Back Hoe Loader 7
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Bike 69
Bobcat 1
Boom Placer 1
BT Roller 10
BT Sprayer 5
Bus 1
Camper 23
Cars 74
Concrete Batch Mix Plant 9
Concrete Paver 2
Concrete Pump 3
Crane 3
Crusher 11
Diesel Bowser 4
Earth Compactor 17
Excavator 15
Grader 13

Hot Mix Plant - Batch Type 4

Hot Mix Plant Drum Type 8
Loader 13
Lorry 1
Mechanical Paver 5
Mobile Concrete Mixer 3
Other Machines 53
Power Generators 42
PTR Roller 4
Robat 1
Sensor Paver 5
Tippers 110
Tractor 3
Tractor Dozer 3
Tractors / Trailer 15
Trailer 1
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Transit Mixer 15
Trolley 6
Trolley Mounted Crane 1
Water Tanker 11
Wet Mix Plant 6

Total 586

Title: Asset Management Group –

Standard Operating Procedure

SOP Number: AMG-001 Version: 1.0.1

6 Scope of Asset Management Group

6.1 The scope of AMG comprises of acquisition, utilization, maintenance, disposal

of Plant & Machinery \ Construction Equipment \ Construction Vehicles \ Utility
Vehicles with their associated accessories and making them available for the
projects at pre-determined hire rates.

6.2 The scope of AMG operations shall be limited as indicated below:

Asset Type Agency Responsible Cost of

Hire
Maintenanc the
Charges
Maintenan e Changes asset
Purchase applicabl
ce applicable Debited
e
To
Plants
including
Crushers, Yes
Batching (Except
AMG AMG No AMG
Plants, for
WMM, Hot Crushers)
Mix Plants

Construction
Equipment
such as
Graders,
Excavators,
AMG AMG Yes No AMG
Loaders,
Pavers, All
Types of
Compactors

Generators AMG AMG Yes No AMG

with
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Capacity
greater than
 20 KVA

Generators
with
Capacity
Project AMG No Yes Project
Less than 20
KVA

Shuttering
and related
Project Project No No Project
Materials

Laboratory Project No No Project

Equipment Project

Tools and
small
machines **
for the
purpose of
Project Project No No Project
Project
(other than
maintenanc
e work)

Construction
Vehicles
such as
Tippers, AMG Yes AMG
Lorry,
Tankers

Cars
Project AMG No Yes Project

Two
Wheelers
(Scooters, Project No No Project
Bikes etc.,)

Three AMG No Yes Project

Wheelers Project

Note: ** All Tools and small machines costing less than 2.0 Lakhs individually
shall be considered as small machines and the same shall be within the scope of
the project both in terms of purchase and maintenance.
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7 Monthly Hire Charges

7.1 Monthly rates are based on 8 (Eight) hours shift per day for 28 (Twenty Six)
shifts in a month with 2/3 days as maintenance days. Working timing shall be
communicated to AMG well in advance / prior to commencement of work at
site. Overtime beyond 26 shifts or 8 hours shift per day in a month shall be
charged extra on prorate basis.

Title: Asset Management Group –

Standard Operating Procedure

SOP Number: AMG-001 Version:

1.0.1

7.2 The Machine Log book / DPR shall be treated as final documents for time
calculations, which shall be duly signed by the competent representatives of
both the Project and AMG.

8Rates, Duties and Taxes

8.1 All applicable taxes, including VAT, Service Tax, Entry Tax, Special Entry Tax,
Octroi and any other statutory levies shall be borne by the Project and
documents relating to movement of Equipment, such as way bills, shall be
provided by the Project.

9. Statutory Compliances

9.1 All such costs related to statutory compliances namely Road Tax, Life Tax,
Registration, Permit, Fitness Certificate, Pollution Certificate with respect to
hired assets shall be to the account of AMG.

10. Fines Imposed by Statutory Bodies / Authorities

10.1 In case of any fine or penalty imposed on the hired asset citing lack of
documents or non-compliance of statutory requirements, it shall be to the
account of AMG.

10.2 In case of any fine or penalty imposed on the hired asset citing excessive
load, it shall be to the account of Project.

11. Insurance

11.1 AMG shall arrange for the insurance of the Equipment.

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12. Mobilization and Demobilization

12.1 For hire period up to 6 months, both mobilization & demobilization shall be
in Project’s scope.

Title: Asset Management Group –

Standard Operating Procedure

SOP Number: AMG-001 Version: 1.0.1

12.2 For hire period of more than 6 months, mobilization shall be in Project’s
scope & demobilization shall be in AMG scope.

12.3 For hire period of more than 12 months, both mobilization & demobilization
in AMG scope.

13. Loading / Unloading Charges

13.1 Project shall make suitable arrangement such as ramp/crane & bear the
cost for same for loading & unloading of equipment at the time of
receiving/relieving & inter site movements.

14. Power, Electricity and Diesel Fuel

14.1 The hire charge of the Equipment is exclusive of the cost of power / fuel
used for operating the equipment as per actual consumption basis without
any deductions. Customer shall ensure good quality fuel.

15. Repair & Maintenance

15.1 AMG’s personnel at site shall carry out preventive or scheduled

maintenance. Project shall provide adequate assistance/place and facilities
for carrying out the said maintenance. The repair and maintenance expenses
on account of spares, consumable, lubricants, service charges etc., shall be
to the account of AMG. In case any expenditure is incurred by the project in
case of any emergency, the same shall be reimbursed by the AMG.

16. Crew and Operator

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16.1 As a standard, AMG provides one set of Crew along-with equipment. Any
Additional crew shall be on chargeable basis.

16.2 The Project shall provide the accommodation and fooding to Operators and
Mechanic Crew on free of cost basis or bear the cost of accommodation/
fooding at site for the crew/supervisors, etc. The Projects shall bear all the
incidental cost to the maintenance of mess (such as providing of water
tankers to mess etc.,) also.

Title: Asset Management Group –

Standard Operating Procedure

SOP Number: AMG-001 Version: 1.0.1

17. Salaries

17.1 The salaries for the AMG manpower (AMG Establishment, Crew, Operators,
Helpers, Maintenance Personnel etc.,) shall be paid and borne by the AMG.
However, as the Projects are responsible for providing of food and
accommodation, the salaries pertaining to the running of mess shall be borne
by the Projects.

18. Accessories, attachments & wear parts

18.1 Standard equipment shall be provided. Any accessories and attachments

required shall be to user scope. All wear items such Tubes & Tyres, Teeth
Points for Excavators, Blades etc., shall be in the scope of the AMG.

19. Down time/breakdown time

19.1 Down time/breakdown time from the monthly operational Rentals of the
Equipment shall be measured on the following basis:

19.2 Breakdown of the Equipment up to 2 hours at a stretch shall not be treated

as breakdown. Any breakdown beyond 2 hours at a stretch shall be
considered as a breakdown and deductible on proportionate basis till
Equipment is/are commissioned again subjected to terms & conditions.

19.3 If any Equipment is not available due to breakdown, pro-rata deduction for
a maximum period of 10 hours per day is applicable.

19.4For monthly renting, any breakdown beyond 28 shifts of operations is not

considered as breakdown, and there shall not be any deduction of amount
from the Rentals.
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 19.5 If any Equipment works less than 10 hours in a day, and under breakdown,
the deficit period to 10 hours per day shall be deducted as breakdown hours.

19.6 If the Equipment remains idle due to no work at site then these idle hours
shall not be considered as breakdown hours at the time of certification.

Title: Asset Management Group –

Standard Operating Procedure

SOP Number: AMG-001 Version: 1.0.1

20. Hire Charges Billing

20.1 The billing cycle shall be on calendar month basis.

20.2 The hire period shall commence on the day the equipment reaches at the
project site. In case of order of new equipment specifically for the project,
the hire period shall commence on the day of the commissioning of the new
equipment at the site.
20.3 In case the asset is not deployed for the entire duration of the month, the
invoicing will be done proportionately for the days the asset has been in use
by the project.

20.4 The Asset Log Sheet / DPR shall be prepared by the representative of the
AMG indicating the working hours and breakdown hours and both AMG and
Project’s representatives shall sign these documents and this document shall
be binding on both AMG and Project.

20.5 The projects are entitled for deductions for breakdown days beyond 2 days
in a calendar month. However in case the total hours the asset is put to use
exceed the minimum billable hours/days, there will be no deductions on
account of breakdown even if there is any.

20.6 No deduction is allowed for the period or the time the asset is idle.

20.7 The monthly bills submitted by the AMG to the Project Manager shall be
certified within 5 working days, failing which the bill submitted by the AMG
shall be deemed as correct and the same shall be charged to the Project’s
account.
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 21. Role of Project Managers

21.1 In spite of the fact that AMG is a separate division within GVRIPL, the Project
Manager (PM) is the Custodian of the Assets deployed within his/her project.
AMG is created with the intention of freeing the Project Manager from the
day-to-day drudgery of spending time on managing the assets and to enable
Project Managers to concentrate on their core strength, i.e., project
execution. Further, responsibilities of Project Managers are as follows:

Title: Asset Management Group –

Standard Operating Procedure

SOP Number: AMG-001 Version: 1.0.1

21.2 The PM will ensure that the asset is used for the intended purpose and
proper care is taken by all concerned.

21.3 The PM will not Remove/ Shift/Transfer the asset/equipment without the
express approval of Director, Asset Management.

21.4 The PM will ensure the security of the assets under his/her Project.

21.5 The PM will not make any alterations, additions or improvements to

the assets or the equipment without the express approval of
Director, Asset Management.

21.6 The PM will communicate full details of any receipt or dispatch of

asset/equipment to and from his/her project giving details namely:
description of asset/equipment, date

21.7 of receipt or transfer in writing to Director (Technical) as well as Director,

Asset Management.

21.8 The PM will communicate full details of any receipt or dispatch of NEW
ASSET/EQUIPMENT to his/her project in writing giving details namely: Asset
Number, Description of asset/equipment & date of receipt in writing to AMG
Corporate Office, Director (Technical) as well as Director, Asset Management.

21.9 The PM has to convey his vehicle/equipment requirement at least 10 days in

advance to Director, Asset Management through Director, Technical. In case
of Plant and Machinery a minimum notice period of 30 days is required.
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 22. Role of Plant Managers

Title: Asset Management Group –

Standard Operating Procedure

SOP Number: AMG-001 Version: 1.0.1

23. REVISION HISTORY

Versio Change Description Date of

n Date Adopted

1.0.1 Cleanup added. 23.4.2010

1.02 Document Initiation. 27.4.2010

APPROVALS

NAME SIGNATURE DATE

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