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A PROJECT REPORT ON

IFFCO

INDIAN FARMERS FERTILISER COOPERATIVE LTD

KANDLA
(A DIVISION OF NIS SPARTA LTD.A RELIANCE ANIL
DHIRUBHAI AMBANI GROUP CO.)
SUBMITTED TO : SUBMITTED BY :
NIS ACADAMY MANEESH KUMAR
TABLE OF CONTENTS

Acknowledgement………………………………………………

Preface……………………………………………………………

INTRODUCTION

• ORIGIN OF IFFCO

• INDIAN FARMER SUCCESS STORY

(i) IFFCO IN BRIEF

(ii) SHARE CAPITAL

(iii) KANDLA UNIT

MARKETING PERFORMANCE

• MARKEING CHENNAL

• DISTRIBUTION & WAREHOUSING

• MARKETING TERRITORIES OF IFFCO

• SALES PERFORMANCE

• SALES DURING KHARIF SEASON

• SALES DURING RABI SEASON

FINANCIAL PERFORMANCE

 TURNOVER
SERVICE TO FARMERS
 COOPERATIVE RURAL DEVELOPMENT
TRUST (CORDET)
 ACTIVITIES OF CORDET

MAJOR AWARDS RECEIVED


VISION ---2010
 BROAD VISION OF THE SOCIETY
 INVESTMENT FOR CAPACITY
INCREASE
 US$ 1.5 Billion INVESTMENT IN POWER
PROJECT
 US$ 0.6 Billion INVESTMENT IN SEZ
 IFFCO PLANTS
 IFFCO SUBSIDIARIES
 IFFCO ASSOCIATES
 IFFCO ASSOCIATES
 CUMULATIVE ACHIEVEMENTS

CONCLUSION
SUGGESTION
ACKNOWLEDGEMENT

• I would like to express my sincere gratitude and thanks


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

• It goes beyond words to express my special thanks to


Mr. MITESH PATEL , who despite of her busy
schedule for providing information which I required for
my project.

• Thanks all of you


• Your sincerely
• MANESH KUMAR
ST
• MBA 1 Year
PREFACE
Master of business administration (MBA) one of the most
reputed professional courses which includes both the theoretical
and practical training as a part of two year curriculum. Progress is
the continuous process. It is relative and absolute. We can not stop
at certain destination and declare that target has achieved.
The Industrial visit programs are designed to give the
manager of the future, a feel of the corporate happening and work
culture. These real life situations are entirely different from the
simulation exercise enacted in an artificial environment in side of
classroom. And it is precisely because of this reason that this
industry visit is a bridge between the institute and the organization.
Industrial visit programs made me to understand how theoretical
knowledge will be applied in practical field.
It exactly in this context that I was privileged enough to join
IFFCO,KANDLA. On 20,FEB, 2009, as a Industrial Visit. This
is a cooperative society of FERTILIZER and it is known not only
in professional management, but also in enlightened and
progressive approach towards employee welfare and betterment of
society.
I have collected all the relevant information through this
visit.
INTRODUCTION

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

 IFFCO was established as the farmers’ own initiative in


Cooperative Sector on 3rd Nov. 1967 with the proposed
plants at Kalol & Kandla.

 With the enactment of Multi State Co-operative Societies


Act 2002, the Society is deemed to be registered as a Multi
State Co-operative Society. The Society is fully owned by
Cooperatives.
.
IFFCO : Indian Farmers' Success Story
During mid- sixties the Co-operative sector in India was
responsible for distribution of 70 per cent of fertilisers
consumed in the country. This Sector had adequate
infrastructure to distribute fertilisers but had no production
facilities of its own and hence dependent on public/private
Sectors for supplies. To overcome this lacuna and to
bridge the demand supply gap in the country, a new
cooperative society was conceived to specifically cater to
the requirements of farmers. It was an unique venture in
which the farmers of the country through their own Co-
operative Societies created this new institution to
safeguard their interests. The number of co-operative
societies associated with IFFCO have risen from 57 in
1967 to 38, 155 at present.
Indian Farmers Fertiliser Co-operative Limited (IFFCO)
was registered on November 3, 1967 as a Multi-unit Co-
operative Society. On the enactment of the Multistate
Cooperative Societies act 1984 & 2002, the Society is
deemed to be registered as a Multistate Cooperative
Society. The Society is primarily engaged in production
and distribution of fertilisers. The byelaws of the Society
provide a broad frame work for the activities of IFFCO as
a Cooperative Society.

IFFCO commissioned an ammonia - urea complex at


Kalol and the NPK/DAP plant at Kandla both in the state
of Gujarat in 1975. Another ammonia - urea complex was
set up at Phulpur in the state of Uttar Pradesh in 1981. The
ammonia - urea unit at Aonla was commissioned in 1988.

In 1993, IFFCO had drawn up a major expansion


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

IFFCO has made strategic investments in several joint


ventures. Godavari Fertilisers and Chemicals Ltd (GFCL)
& Indian Potash Ltd (IPL) in India, Industries Chimiques
du Senegal (ICS) in Senegal and Oman India Fertiliser
Company (OMIFCO) in Oman are important fertiliser
joint ventures. Indo Egyptian Fertiliser Co (IEFC) in
Egypt is under implementation. As part of strategic
diversification, IFFCO has entered into several key
sectors. IFFCO-Tokio General Insurance Ltd (ITGI) is a
foray into general insurance sector. Through ITGI, IFFCO
has formulated new services of benefit to farmers. 'Sankat
Haran Bima Yojana' provides free insurance cover to
farmers along with each bag of IFFCO fertiliser
purchased. To take the benefits of emerging concepts like
agricultural commodity trading, IFFCO has taken equity in
National Commodity and Derivative Exchange (NCDEX)
and National Collateral Management Services Ltd
(NCMSL). IFFCO Chattisgarh Power Ltd (ICPL) which is
under implementation is yet another foray to move into
core area of power. IFFCO is also behind several other
companies with the sole intention of benefitting farmers.

The distribution of IFFCO's fertiliser is undertaken


through over 38155 co-operative societies. The entire
activities of Distribution, Sales and Promotion are co-
ordinated by Marketing Central Office (MKCO) at New
Delhi assisted by the Marketing offices in the field. In
addition, essential agro-inputs for crop production are
made available to the farmers through a chain of 158
Farmers Service Centre (FSC).
IFFCO has promoted several institutions and organisations
to work for the welfare of farmers, strengthening
cooperative movement, improve Indian agriculture. Indian
Farm Forestry Development Cooperative Ltd (IFFDC),
Cooperative Rural Development Trust (CORDET), IFFCO
Foundation, Kisan Sewa Trust belong to this category. An
ambitious project 'ICT Initiatives for Farmers and
Cooperatives' is launched to promote e-culture in rural
India. IFFCO obsessively nurtures its relations with
farmers and undertakes a large number of agricultural
extension activities for their benefit every year.

At IFFCO, the thirst for ever improving the services to


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

IFFCO, to day, is a leading player in India's fertiliser


industry and is making substantial contribution to the
efforts of Indian Government to increase foodgrain
production in the country.
IFFCO - IN BRIEF

• Largest producer of fertilisers in the country

• No. of Plant Locations : Five

• Installed Annual Capacity (‘000 MT)

 UREA - 4242.2

 NPK/DAP - 4335.4

 TOTAL ‘N’ - 2628.2

 TOTAL ‘P2O5’ - 1712.8

 Only Fertiliser Institution in the country to


produce 68.47 lakh MT of fertilisers and 93.24 lakh
MT of sales during 2007-08

 Contributed about 20% to the total ‘N’ and 25%


to the total “P2O5” produced in the country during the
year 2007-08

 Fertilisers marketed through 39564 Cooperative


Societies and 158 Farmers Service Centres

 Service to the Farmers through a variety of


programmes
SHARE CAPITAL

Authorized Share Capital : 1000.00


Subscribed and : 423.93
Paid up Capital

(All Share Capital wholly owned by Cooperatives only)

GROWTH IN NUMBER OF MEMBER SOCIETIES

(As on 31st March)

39564
37381
35072
30200
26960 28134
25528

57

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

FERTILISER PRODUCTION 1037 Lakh MT


FERTILISER SALE 1126 Lakh MT

CUMULATIVE PRODUCTION TILL DATE

TURNOVER Rs. 92005 Crore

PROFIT BEFORE TAX Rs. 6445 Crore

PROFIT AFTER TAX Rs. 4994 Crore

CONTRIBUTION TO EXCHEQUER Rs.5103 Crore

UNIT PRODUCT PRODUCTION

KALOL UREA 139

PHULPUR - I UREA 142

PHULPUR - II UREA 89

AONLA – I UREA 165


AONLA – II UREA 98
TOTAL UREA 633

KANDLA NPK 235

DAP 155
PARADEEP NP 6

DAP 10

TOTAL NPK/DAP 406

TOTAL FERTS. 1039


NUTRIENTS ‘N’ 345

‘P2O5’ 147
KANDLA UNIT

YEAR OF COMMISSIONING : 1975

INVESTMENT : Rs. 24.26 Crore

YEAR OF FIRST EXPANSION : 1981

INVESTMENT : Rs. 28.60 Crore

YEAR OF SECOND EXPANSION: 1999

INVESTMENT : Rs. 205.30 Crore

PRODUCT CAPACITY TECHNOLOGY


P2O5 TPA
9,10,000 FOUR STREAMS (A,B,C & D)
BASED ON TVA SLURRY
GRANULATION PROCESS.
TWO STREAMS (E & F)
BASED ON AZF PIPE
REACTOR TECHNOLOGY.
‘N’ 3,51,540
TOTAL FERTILISER
PRODUCTION

(Lakh MT)
70.12 68.47
61.54 64.35
57.01

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


GROWTH IN PRODUCTION
CAPACITIES (Lakh MT)
50
Urea 43.35
42.42

40 NPK/DAP 36.89 36.89 36.89 43.35


32.18 32.18
36.89
30 24.91
23.43

20 16.17
21.91
24.15
19.74
8.91 8.91 16.00
10 3.96
8.81 8.81 8.81 8.81 8.81
4.16 4.16 4.16
0
7

9
5

75

01

02

04
1

8
1

5
88
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ay
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Ap

Ap

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Au

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O
STREAM DAYS ACHIEVED
UNIT PLANT

KANDLA TRAIN A

TRAIN B
MARKETING TERRITORIES OF
TRAIN C

TRAIN D

TRAIN E
MARKETING CHANNELS

Distribution of fertilisers mainly through


the Cooperative System:

 State level Apex Cooperative Marketing


Federation acts as wholesaler

 Direct supplies to Societies in some States

 IFFCO-NCDC Cooperative Societies

 Small quantities to institutional agencies like


Agro Industries Corporation etc

 158 IFFCO Farmers Service Centres

DISTRIBUTION & WAREHOUSING

TRANSPORTATION

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

WAREHOUSING

Federations & Cooperative Godowns


Central Warehousing Corporation (CWC) and

State Warehousing Corporation (SWC)

MARKETING TERRITORIES OF IFFCO

MARKETING
MARKETING
CENTRAL
CENTRAL
OFFICE
OFFICE
NORTH CENTRAL ZONE NORTH ZONE SOUTH ZONE WEST ZONE EAST ZONE
NORTH (LUCKNOW)
CENTRAL ZONE NORTH ZONE SOUTH ZONE WEST ZONE EAST ZONE
(LUCKNOW)
(CHANDIGARH) (BANGALORE) (BHOPAL) (KOLKATA)
(CHANDIGARH) (BANGALORE) (BHOPAL) (KOLKATA)

UP,BIHAR GUJ, MP,


UP,BIHAR PUN, HAR, GUJ, MP, ASSAM,
JHARKHAND, PUN, HAR, AP, TN, KAR, MAH, ASSAM,
JHARKHAND, RAJ, J&K, AP, TN, KAR, MAH, ORISSA,
UTTARANCHA RAJ, J&K, KERALA CHHATTISGAR ORISSA,
UTTARANCHA HP KERALA CHHATTISGAR W.B.
L HP H W.B.
L H
SALES PERFORMANCE

(Lakh MT)

COMPLEX UREA
52.41 54.29
50.13

38.95
37.02 36.7
33.69
31.82
27.94
23.52

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


SALES DURING KHARIF SEASON

(Lakh MT)

PRODUCT 2003

UREA 17.6
NP -
NPK 10:26:26 0.9

NPK 12:32:16 2.2


SALES DURING RABI SEASON

(Lakh MT)

PRODUCT 200

UREA 19.
NP -
NPK 10:26:26 1.

NPK 12:32:16 4.
FINANCIAL PERFORMANCE
(Rs. Crore)

2003-

TURNOVER 6090.0

PROFIT BEFORE TAX 512.7

INCOME TAX 183.0

PROFIT AFTER TAX 329.6

SHARE CAPITAL 461.9

RESERVES AND SURPLUS 2647.6


TURNOVER
(Rs. Crore)

12163

9943 10330

7397
6090

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


SERVICE TO FARMERS

Agricultural Extension and fertiliser use promotion


programmes are an integral part of the marketing
activity. Programmes are conducted at
Area/State/Zonal offices under the guidance of
agricultural scientists.

Programmes undertaken are :

Balanced Fertilisation programmes


Adoption of villages for all round socio-economic
development
Farmers visit to various agricultural institutes and
research farms
Farmers’ Meetings, Field Days and Crop Seminars
Static/Mobile Soil Testing Laboratories with Audio-
visual aids

COOPERATIVE RURAL
DEVELOPMENT TRUST (CORDET)

PROMOTED BY IFFCO
LOCATIONS
KALOL (GUJARAT)
 PHULPUR (U.P.)
 KANDLA (GUJARAT)

ACTIVITIES OF CORDET
Farmers’ Training
Soil Testing
Bio Fertiliser Production
Demonstration Farming
Seed Multiplication

IFFCO’s MPLS VPN


Airtel VPN

BSNL
VPN
Remote offices Saket office
Internet
Network &
Airtel
Security Spectra net- 1

VSAT VSAT VSAT VSAT


Setup
VSAT Spectra net- 2
PIX 506 Router Gig0/2

PIX 506 Phulpaur IPS In


Paradeep
Aonla External Switch Inline Mode Gig0/1
Kandla Kalol LAN
LAN

PIX Firewall
in HA Mode ASA
Firewall
Internal Switch

SO & AO
Mktg offices Core L3 Switch LAN
MPLS CLOUD

600 Connections
91 Direct on MPLS and User Zone
509 MPLS VPN Client
Core Router In
Checkpoint Firewall
GLBP Mode
on Alteon
Chandigrah Call Manager
3560 L3 Switch VMS, ACS,
Servers Checkpoint
Servers Security servers
Lucknow

Bhopal
Banglore Kolkata
VSAT Connectivity to Zonal Offices
MAJOR AWARDS RECEIVED

Seven Awards for Best Overall Performance from FAI


Two Awards for Industrial Safety from GOI

Award for Technical Innovation from FAI

Two Raj Bhasha Shields for promoting Hindi

Four Awards for Safety from National Safety Council,


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

Indo German Greentech Environment Excellence Award

National Safety Award (Runner up)

Two National Energy Conservation Award and Letter of


Appreciation from Govt. of Gujarat

Vishwakarma Rashtriya Puraskar to three employees from


Govt. of India
VISION ---2010

BROAD VISION OF THE SOCIETY

⇒To augment the incremental income of farmers by


helping them to increase their crop productivity through
balanced use of energy efficient fertilisers

⇒To maintain the environmental health

⇒To make cooperative societies economically and


democratically strong for professionalised services to the
farming community to ensure an empowered rural India.

⇒The Society has embarked upon another growth plan


titled “VISION 2010” to achieve annual turnover of Rs.
15,000 crore (USD 3750 Million) by the year 2010.

⇒Society is exploring avenues for diversification into


other profitable business areas, apart from fertiliser
sector, for sustained growth and adequate return to
member shareholders.

⇒Vision 2010 would mainly focus on farmer oriented


schemes and strengthening of cooperative infrastructure.

⇒Broadly identified business activities under the “VISION


2010“ are :-
⇒ Installation of Ammonia/Urea plants including
acquisition of fertiliser units

⇒Generation of Power

⇒Production and Marketing of micro-nutrients, seeds, bio-


fertilisers, pesticides etc.

⇒Value addition to agri-products and marketing

⇒Banking and Financial Services

⇒Information Technology and IT enabled services

⇒Establishments of Retail Chain in urban and semi-urban


locations

INVESTMENT FOR CAPACITY INCREASE

IFFCO has envisaged a major expansion/diversification


plan to invest USD 1 Billion to ramp up the Domestic
Fertiliser Production Capacity, Acquisition of Plants, Joint
Ventures in foreign countries and Energy Reduction
Measures in existing Units:

►Energy Saving Project (ESP) has been implemented in


all Ammonia and Urea Plants at Kalol, Phulpur and
Aonla units with total investment of Rs. 412 Crore
(USD 103 Million).
►Capacity Enhancement Project (CEP) implemented at
Phulpur and Aonla units in May’08.

►A State-of-the-Art phosphoric acid plant in Egypt


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

►Another Phos. Acid Plant (JIFCO) with Jordan


Phosphatic Mines Co. Ltd. (JPMC) with project cost
of USD 580 Million having capacity of 1500 MT per
day. IFFCO holding is 52%.

► Acquired NPK/DAP Plant of 2 Million MTPA at


Paradeep alongwith Phosphoric Acid and Sulphuric
Acid at a cost of USD 505 Million in October 2005.

US$ 1.5 Billion INVESTMENT IN POWER


PROJECT

1320 MW Power Project at Chhattisgarh.


IFFCO Chhattisgarh Power Ltd. with Chhattisgarh State
Electricity Board (CSEB) incorporated on 25.01.2006 .
Salient features of the Project :
Total estimated project cost USD 1.5 billion
Equity participation by IFFCO (74%) and CSEB
(26%)
Scheduled commissioning of first unit of 500/660
MV in 2011

Low tarrif electricity to farmers of Chhattisgarh

Active participation of Government in the land,


coal, water and infrastructure fronts

US$ 0.6 Billion INVESTMENT IN SEZ

IFFCO has laid foundation stone for IFFCO KISAN


SEZ at Nellore, India, on March 21, 2008. Special
features are :

 Estimated investment of USD 600 Million

 Closed to Krishnapatnam Port

 Farmer Friendly infrastructure planned

 Provision for Food Processing Zone

 Secondary and Tertiary Industries under consideration


IFFCO PLANTS

C o m m is
P la n ts L o c a t io n
in

K a lo l G u ja r a t 1975

K a n d la G u ja r a t 1975
IFFCO SUBSIDIARIES

IFFCO TOKIO GENERAL INSURANCE COMPANY


LTD.

INDO EGYPTIAN FERTILIZERS COMPANY, SAE

JORDAN INDIA FERTILIZER COMPANY LLC

IFFCO CHHATTISGARH POWER LTD.

KISAN INTERNATIONAL TRADING FZE

IFFCO TOKIO INSURANCE SERVICES LTD.

IFFCO KISAN BAZAR LTD.

IFFCO KISAN SANCHAR LTD.

IFFCO KISAN SEZ LTD.

INDIAN FARM FORESTRY DEVELOPMENT COOP.


LTD
IFFCO ASSOCIATES

INDUSTRIES CHIMIQUES DU SENEGAL

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

INDIAN POTASH LTD.

NATIONAL COMMODITY & DERIVATIVES


EXCHANGE LTD.

NATIONAL COLLATERAL MANAGEMENT


SERVICES LTD.

COOPERATIVE RURAL DEVELOPMENT TRUST

KISAN SEWA TRUST

IFFCO FOUNDATION

LEGEND INTERNATIONAL HOLDINGS INC.


CUMULATIVE ACHIEVEMENTS

FERTILISER PRODUCTION 104 Million MT

FERTILISER SALE 113 Million MT

TURNOVER USD 22841 Million

PROFIT BEFORE TAX USD 1600 Million

PROFIT AFTER TAX USD 1240 Million

CONTRIBUTION TO EXCHEQUER USD 1267


Million
CONCLUSION

⇒ IFFCO, to day, is a leading player in India's fertiliser


industry and is making substantial contribution to
the efforts of Indian Government to increase food
grain production in the country.

⇒At IFFCO, the thirst for ever improving the services


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

⇒Increase canteen facilities for the employee.

⇒ IFFCO has four production plants but these plants


are not sufficient for production. So increase the
numbers of plant.

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