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Organization Theory and Practice project Report:

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Contents
Organization Theory and Practice project Report:................................................................................. 1 Introduction ............................................................................................................................................ 3 Vision and Mission.................................................................................................................................. 3 History .................................................................................................................................................... 5 Company Hierarchy ................................................................................................................................ 6 Organization Growth Factors ................................................................................................................. 6 Well suited Organization Structure ................................................................................................ 7 Marketing Strategies based of Geography and customer orientation .................................... 10 Best HR Practices And Company Values ....................................................................................... 14 Cost effective and Environmental strategies ............................................................................... 15 Joint Ventures and Subsidiaries : ................................................................................................. 17 Just in time(JIT) spare parts inventory division ............................................................................ 21 Maintaining good reputation by performing Corporate social responsibility activities : ............ 22 Focused Research and development Approach ........................................................................... 24 Awards and Achievements ................................................................................................................... 27 Vehicles :............................................................................................................................................... 28 Learnings .............................................................................................................................................. 30

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Introduction
Bajaj Auto is a major India Automobile manufacturer. It is India's largest and the world's 4th largest two- and three-wheeler maker. It is based in Pune, Maharashtra, with plants in Akurdi and Chakan (near Pune),Waluj and Patnagar in Uttaranchal. Bajaj Auto makes and exports motor scooters, motorcycles and the auto rickshaw.Over the last decade, the company has successfully changed its image from a scooter manufacturer to a two wheeler manufacturer. Its product range encompasses scooters and Motorcycles. Its real growth in numbers has come in the last four years after successful introduction of a few models in the motorcycle segment. The company is headed by Rahul Bajaj who is worth more than US$1.5 billion.Bajaj Auto came into existence on November 29, 1945 as M/s Bachraj Trading Corporation Private Limited. It started off by selling imported two- and three-wheelers in India. In 1959, it obtained license from the Government of India to manufacture two- and three-wheelers and it went public in 1960. In 1970, it rolled out its 100,000th vehicle. In 1977, it managed to produce and sell 100,000 vehicles in a single financial year. In 1985, it started producing at Waluj in Aurangabad. In 1986, it managed to produce and sell 500,000 vehicles in a single financial year. In 1995, it rolled out its ten millionth vehicle and produced and sold 1 million vehicles in a year.

Vision and Mission


Bajaj doesn't have a straight vision or mission statement. They define it in terms of brand identity, brand essence (derived from mission) and brand values.

Our Brand Identity

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Our Brand is the visual expression of our thoughts and actions. It conveys to everyone our intention to constantly inspire confidence. Our customers are the primary audience for our brand. In doing so, we ensure a special place for ourselves in the hearts and the minds of our customers.

Our Brand Essence Our Brand Essence is the soul of our brand. Our brand essence encapsulates our mission at Bajaj. It is the singular representation of our terms of endearment with our customers. It provides the basis on which we grow profitably in the market. Our Brand Essence is Excitement. Our Brand Values We live our brand by its values of Learning, Innovation, Perfection, Speed and Transparency. Bajaj will constantly inspire confidence through excitement engineering.

Learning Innovation Perfection Speed Transparency

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History
Founded in 1926, at the height of India's movement for independence from the British, the group has an illustrious history. The integrity, dedication, resourcefulness and determination to succeed which are characteristic of the group today, are often traced back to its birth during those days of relentless devotion to a common cause. Jamnalal Bajaj, founder of the group, was a close confidant and disciple of Mahatma Gandhi. In fact, Gandhiji had adopted him as his son.This close relationship and his deep involvement in the independence movement did not leave Jamnalal Bajaj with much time to spend on his newly launched business venture. His son, Kamalnayan Bajaj, then 27, took over the reins of business in 1942. He too was close to Gandhiji and it was only after Independence in 1947, that he was able to give his full attention to the business. Kamalnayan Bajaj not only consolidated the group, but also diversified into various manufacturing activities. The present Chairman of the group, Rahul Bajaj, took charge of the business in 1965. Under his leadership, the turnover of the Bajaj Auto the flagship company has gone up from Rs.72 million to Rs.46.16 billion (USD 936 million),its product portfolio has expanded from one to and the brand has found a global market. He is one of India's most distinguished business leaders and internationally respected for his business acumen and entrepreneurial spirit. Bajaj Auto Demerger:

BAL approved the demerger scheme, splitting the group into three separate entities with the creation of two new companies. According to the scheme, Bajaj Auto's various businesses would be demerged into two newly incorporated subsidiaries - Bajaj Holdings and Investment (BHIL) and Bajaj Finserv (BFL).

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As part of the scheme, Bajaj Holdings and Investment will become the new auto company, renamed Bajaj Auto. The existing Bajaj Auto will be renamed Bajaj Holdings and Investment, and will act as the primary investment company.

Company Hierarchy
Director Remuneration Bajaj Auto Ltd.

Directors Name Rahul Bajaj Madhur Bajaj Rajiv Bajaj Sajiv Bajaj D S Mehta Kantikumar R Podar Shekhar Bajaj D J Balaji Rao J N Godrej S H Khan Suman Kirloskar Naresh Chandra Nanoo Pamnani Manish Kejriwal P Murari Niraj Bajaj J Sridhar [Ref: Powerss]

Designation Ch Vice Ch Md Exec. Director Director Director Director Director Director Director Director Director Director Director Director Director Co. Secretary

Board Meet Attended 7 8 9 9 1 1 2 2 1 2 2 2 2 1 1 1 749

Salary 1,64,62, 1,00,14, 973 67,33,11 8 49,25,91 4 5,37,600

Sitting Fees

Bonus/ Commission 2,16,00, 000 1,53,00, 000 1,35,00, 000 99,00,00 0 1,50,000 2,50,000 3,00,000 5,50,000 1,50,000 5,50,000 3,00,000 5,00,000 4,00,000 2,50,000 1,50,000 2,00,000

Total Remuneration 3,80,62,749 2,53,14,973 2,02,33,118 1,48,25,914 7,07,600 2,70,000 3,20,000 5,90,000 1,70,000 5,90,000 3,20,000 5,40,000 4,20,000 2,70,000 1,70,000 2,00,000

20,000 20,000 20,000 40,000 20,000 40,000 20,000 40,000 20,000 20,000 20,000

Organization Growth Factors


The factors responsible for the growth of BIAL are as follows:
Well suited Organization Structure

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Marketing Strategies based on geography and customer orientation

Best HR practices and Company Values

Cost effective and Environmental strategies

Joint ventures and Subsidiaries

Cordial relationships with workmen force

Just in time (JIT) spare parts inventory division

Maintaining good reputation by performing Corporate social responsibility activities

Focused Research and development Approach

All these factors are explained below:

Well suited Organization Structure


The salient features of organization structure of BAL: Organic Structure: The company has a flat organization structure and aims towards building competencies at each level. The work culture inspires confidence in its employees. Core values of BAL like learning innovation perfection
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speed transparency

This Socialization process of following the above core values acted as cornerstones for building its rich work culture. It has a facilitative style of leadership which helps in developing leaders at all levels. Here point to be noted is that this facilitative style is the outcome of the centralization process that BAL followed at all level of mangers. It clearly demarked on the process of mutual Adjustment rather than the process of Standardization.

Organizational Restructuring Transit from Functional Structure to a Product division structure. Bajaj Auto Limited announced a new organizational restructuring in July 2007. Previously it was following a functional structure which is clearly shown in the below figure 1.1. Old Structure The functional structure was divided into main five units: Research and development. Marketing Finance Human Resource Manufacturing.

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Figure 1.1 The company was of the opinion that with this restructuring, the existing business roles and responsibilities in the company have been strengthened to ensure greater operational empowerment and effective management. The transition was completed on August 01, 2007.

New Structure The new structure followed a product division structure. The five pillars of the new structure, called strategic units, are, R&D
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Engineering Two-wheeler business unit Commercial vehicles business unit and International business unit The finance, MIS, HR, business development and commercial functions will support these units. Of the five segments, the two wheeler, commercial vehicles and international business segments became the special business units (SBU) and had separate revenue structures. Each of the newly appointed CEOs was responsible for top line, business growth and profitability in their respective business units.

Marketing Strategies based of Geography and customer orientation

BAL followed a different marketing policy for domestic and overseas markets. Domestic marketing strategy: BAL adopted different marketing strategies for different models in the domestic markets. Marketing strategy is clearly based on customer orientation in domestic markets as shown in the strategies for different Products of BAL. Policies followed for few BAL products are mentioned below :

1. Kawasaki 4S - First attempt by bajaj to make a mark in the motorcycle segment. The target customer was the father in the family but the target audience of the commercial was the son in the family.

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2. Boxer - It took the reins from where the Kawasaki 4S left. Target was the rural population and the price sensitive customer. Boxer marketed as a value for money bike with great mileage. Larger wheelbase, high ground clearance and high mileage were the selling factors and it was in direct competition to Hero Honda Dawn and Suzuki MX100.

3. Caliber - The focus for the Caliber 115 was youth. And though Bajaj made the bike look bigger and feel more powerful than its predecessor (characteristics that will attract the average, 25-plus, executive segment bike buyer), its approach towards advertising is even more radically different this time around. Bajaj gave the mandate for the ad campaign to Lowe, picking them from the clique of three agencies that do promos for the company (the other two being Leo Burnett and O&M). Going by the initial market response, the campaign was clearly a hit in the 510 years age bracket. So, the teaser campaign and the emphasis on the Caliber 115 being a `Hoodibabaa' bike placed it as a trendy motorcycle for the college-goers and the 25 plus executives both at the same time.

4. Pulsar - Pulsar was launched in direct competition to the Hero Honda's 'CBZ' model in 150 cc plus segment. The campaign beared innovative punch line of "Definitely Male" positioning Pulsar to be a masculine-looking model with an appeal to the performance sensitive customers. The Pulsar went one step ahead of Hero Honda's 'CBZ' and launched a twin variant of Pulsar with the 180 cc model. The model was a great success and has already crossed 1 million mark in sales.

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5. Discover - The same DTSI technology of Pulsar extended to 125 cc Discover was a great success. With this, Bajaj could realize its success riding on the back of technological innovation rather than the joint venture way followed by competitors to gain market share. BAL now is taking a leaf out of the FMCG business model to take the company to greater heights.Bajaj has kicked off a project to completely restructure the company's retail network and create multiple sales channels.

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Overseas Marketing Strategy:

Bajaj Auto looks at external markets primarily with two strategies: -

1) Identified new potential market overseas.

Bajaj has identified certain key markets, which hold potential. Its first overseas office established at the Jebel Ali free trade zone has been the focal point for exports to middle Africa and the Saharan nations. Egypt and Iran also continue to be strong markets for Bajaj. The other market, which would be a focus area, is South America, where the company feels it is fairly well represented in most countries, except in Brazil, the largest market. The company recently participated in a large auto exhibition in Brazil and found good consumer acceptance to products like Pulsar and Wind 125.

2) Markets conquered with Joint Ventures.

Bajaj has also made a beginning by selling bikes in the Philippines branded in the name of its technical partner, Kawasaki. The two signed an MoU in February. Kawasaki, a large multiproduct conglomerate, only makes high-end bikes and does not have sub-200cc models. Kawasaki is marketing the new model, Wind 125, developed by both companies, in the Philippines. The Bajaj-developed models, Caliber and Byke, which is a fuel-efficient bike, are also being successful.

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Best HR Practices And Company Values

and HR practices are mentioned below:

The Company affirms that its competitiveness is interlinked with the well being of all sections of the Indian society.

The Company believes that equal opportunity in employment for all sections of the society is a component of its growth and competitiveness. It further believes that inclusive growth is a component of growth and development of the country.

The Company affirms the recognition that diversity to reflect socially disadvantages sections of the society in the workplace has a positive impact on business.

The Company will not practice nor support conscious discrimination in any form.

The Company does not bias employment away from applicants belonging to disadvantaged sections of society if such applicants possess competitive skills and job credentials.

The Company's selection of business partners is not based on any considerations other than normal business parameters. In case of equal business offers, the Company will select a business partner belonging to a socially disadvantaged section of society.

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This Code of Conduct for Affirmative Action will be put up on the company web-site to encourage applications from socially disadvantaged sections of society.

The Company makes all efforts for up skilling and continual training of all its employees in order to enhance their capabilities and competitive skills. No discrimination of any type will be shown in this process.

The Company may have a partnership programme with educational institution/s to support and aid students from socially disadvantaged sections of society. The Company will maintain records of Affirmative Action.

The Company has nominated Mr K Srinivas, Vice President (HR), to oversee and promote the Affirmative Action policies and programmes. He will be accountable to the Chairman.

The Company will make available its learning and experiences as a good corporate citizen in Affirmative Action to other companies desiring to incorporate such policies in their own business.

Cost effective and Environmental strategies

Conservation of energy: As a part of continuing efforts to conserve various resources, following steps were taken to conserve energy :

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1) Electrical energy savings: Electrical energy savings was achieved by installation of localized portable air compressors at various shops during low production periods, energy efficient screw compressors by replacing CPT compressors, real timer electrical circuits installed to switch off electrical equipments during lunch / tea breaks and during non utilization of production equipments, fan less cooling towers for AC plants, high efficiency reflector fittings with electronic ballasts tube lights, use of LED & CFT street lights, replacement of 350 W air circulators by 180 W air circulators, 150 W MH lamps instead of 250 W HPSV lamps at shop floors, Variable Frequency Drives (VFD) for ASUs in paint shops, washing machine blowers, compressors etc and rationalization of pumping hours of main pump as well as booster pump of pump house.

2) Water savings: Water savings was achieved by replacement of old under-ground water pipes with aboveground pipes to avoid water wastage through leakage, drip irrigation system for gardening, installation of localized fresh water storage systems, usage of treated water for bin washing and paint shop process, rain water harvesting and use of bio-chemical additives to reduce frequency of water change in various paint processes. 3) LPG savings - LPG savings was achieved by installation of waste heat recovery system for hot water generation used in pre-treatment process of paint shop, use of reflective coating inside furnaces for better heat retention, three-wheeler electro-deposition (ED) painting process changed from Acrylic ED to Cathodic ED, optimization of loading pattern in CGC and seal quench furnaces, reduction of hot water temperature for pre-treatment, use of bio-gas for cooking

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in canteens, start-up losses in ovens and hot water generation plants and changed design of paint jigs to reduce jig stripping frequency.

Impact of measures taken: As a result of the initiatives taken for conservation of energy and natural resources, the company has effected an overall reduction in consumption as under:Reduction achieved in(%): 2008-09 Electrical energy Water LPG 23 11 44 2007-08 23 16 12

Investment / savings: Investment for energy conservation activities: Rs.9.35 million Saving achieved through above activities: Rs.24.2 million

Joint Ventures and Subsidiaries :


Kawasaki: Bajaj and Kawasaki formed a joint venture in 1986 and launched their first product KB 100. Production began in 1986-87 and went on till 1996 when the KB125 was launched.The list of products launched under the joint venture of Bajaj and Kawasaki are as follows:

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1986 - Bajaj M-80, Kawasaki Bajaj KB100 1991 - Kawasaki Bajaj 4S Champion 1997 - Kawasaki Bajaj Boxer, Rear Engine Diesel Auto rickshaw 1998 - Kawasaki Bajaj Caliber, Bajaj Legend, India's first four-stroke scooter, Bajaj Spirit 2001 - Eliminator

Future Plans:

Kawasaki, the Japanese bike manufacturer and Bajaj have maintained a relationship for the past 25 years. And it is likely that this will continue.

Kawasaki will handle the technical part of the Ninja 250 and marketing and distribution will be done by Bajaj in India.

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Bajaj KTM Joint venture

The two auto makers signed an agreement in 2008 to produce motorcycles as a joint venture. Bajaj-KTM collaboration will unveil new bikes that fall in the range of 125 to 250cc during Delhi auto expo in 2010.

Bajaj lately is losing its market share to Hero Honda, and the launch of newer Yamaha bikes are giving Bajaj Auto a run for their money.

Subsidiaries:

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BAL has two subsidiaries. they are mentioned below:

1)PT. Bajaj Auto Indonesia

Was incorporated as a subsidiary company in Indonesia with an issued, subscribed & paid-up capital of US$ 12.5 million (Rs.562 million) in 2006-07. Bajaj Auto holds 97.5% shares in this company, with balance being held by a local partner. The subsidiary company has accumulated losses of Rs. 830.7 million as on 31 March 2009. Through the efforts, which are planned in the coming years, it is expected that PT BAI will turn around within a reasonable time .During the year under review, sales and service network reach have been expanded substantially covering the major cities of Jawa, Sumatara, Bali and Sulawesi islands. Total showroom strength stands at around 63 numbers, covering 46 cities of Indonesia.It assembles and markets Bajaj Pulsar and Bajaj XCD in Indonesia, establishing Bajaj as a high quality tech-savvy brand. PT BAI plans to expand its presence, product range and reach towards becoming a strong player in this market currently dominated by Japanese 2-wheeler majors.

2) Bajaj Auto International Holdings BV, Netherlands (BAIHBV)

Was incorporated as a wholly owned subsidiary company in Netherlands with an issued, subscribed and paid-up capital of Euros 200,000 during 2007-08. Further capital of Euro 98.2 million was invested in this company during the previous year, by way of premium. It is proposed to make strategic investments in overseas ventures, by way of equity shares and / or loans and to undertake related activities through this company.

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Cordial relationships with workmen force:

At Akurdi, the management signed the wage settlement on 18 July 2008 with Vishwakalyan Kamgar Sanghatana, the recognised union, in conciliation and accordingly, the benefits of the settlement have been given to all daily-rated employees at Akurdi. Subsequently, with a view to downsizing the workforce at Akurdi, Voluntary Retirement Scheme was floated for the permanent dailyrated workmen. 2,331 workmen availed of the benefit under the scheme. Relations with staff and workmen across the plants at Akurdi, Waluj, Chakan and Pantnagar remained cordial.

Just in time(JIT) spare parts inventory division:

Automobiles need periodic replacement of parts. Not surprisingly, therefore, spare parts comprise a profitable business for major automobile manufacturers. The objectives of spare parts business of Bajaj Auto are to perform an effective role in supporting new vehicle sales, maintain vehicle goodwill' across different geographies, makes and consumer groups, and contribute to the bottom-line. These translate into three goals: * Make spare parts available to customer at all time. * Make them affordable. * Achieve profitable business growth and greater penetration. The company's spare parts business has done well. Domestic sales of spare parts grew by 17.5% to achieve a revenue of Rs.5.88 billion in 2008-09. And exports rose by 84% to Rs.1.45 billion.
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There is huge head room for further growth of this business. Even today, despite significant expansion of Bajaj Auto's authorized service network, more than 70% of the services during post-warranty period happens in the neighborhood private garages. Hence, the challenge - and the business opportunity - is to make the company's spare parts available in not only the authorized service centres but also the private garages and spare part shops that dot the country. This is a high volume, credit intensive business that requires mastery over the supply of heterogeneous products. To do so, Bajaj Auto created a separate channel exclusively for distribution of spare parts in 2004-05. Today, the channel has 73 distributors, who cater directly to over 15,000 retail shops across the country. This channel now accounts for over 70% of total spare parts sales of BAL. The results demonstrate the success of the channel; and the data suggests that there is still scope for significant growth. Pg#23

Maintaining good reputation by performing Corporate social responsibility activities :

During the year, the company continued affirmative action and corporate social responsibility initiatives in various fields. The company continues to place emphasis on inclusive growth and has put in place certain processes for delivering the intended social outcome in measurable terms. The company believes strongly that its competitiveness is interlinked with the well being of all sections of Indian society and that equal opportunity for all sections of the society is a component of its growth and competitiveness. The company is constantly endeavouring to
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ensure that no discrimination of any type is shown to the socially disadvantaged sections of the society in the work place. Education: The company has launched a programme that would help SC/ST students achieve academic excellence and make them on par with those, who can afford coaching for entrance to IITs. During the year under review, one student with a brilliant academic record was identified from the underprivileged and low-income group, for reimbursement of complete fees for the preparation of IIT entrance test under the guidance of IITians Prashikshan Kendra. Under the central government initiative of Public Private Participation (PPP), the company has volunteered to adopt 3 ITIs (Industrial Training Institute) for up-gradation.

The other activities include: Bajaj Auto Ltd. was the first and only company to launch ecologically friendly CNG engines for three wheelers in Delhi.

The company has been committed to its social and environmental responsibilities both within and outside the company, reiterating that a happy workforce is a productive workforce.

Bajaj Auto promotes several welfare programmes for its employees as well as various initiatives related to environment, health, education and rural development in the communities around the plant areas.

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The company supports these initiative through the Jankidevi Bajaj GramVikas Sanstha, a registered charitable trust and a society. The trust oversees integrated development of twenty four villages adjoining the locations of BAL factories in Pune and Aurangabad. The activities are centered around improvement of natural resources, increased productivity of land, empowerment of women, health, education, sanitation and income generation programmes.

Bajaj Auto Ltd. is also a member of the Prince of Wales International Business Leaders Forum and Business and Community Foundation. Bajaj Auto Ltd. has started contributing toward the fight against AIDS in various ways, including committing funds for medicines for AIDS victims, committing funds for awareness campaigns against HIV/AIDS, providing free condoms, taking initiatives to promote HIV/AIDS awareness among employees and other community members, framing non-discriminatory policies regarding HV/AIDS and providing victims with a support system in the workplace, etc.

Focused Research and development Approach:


Bajaj Auto has a huge, extensive and very well-equipped Research and Development wing geared to meet two critical organizational goals: development of exciting new products that anticipate and meet emerging customer needs in India and abroad, and development of ecofriendly automobile technologies. While the manpower strength of the R&D represents a cross-

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section of in-depth design and engineering expertise, the company has also been investing heavily in the latest, sophisticated technologies to scale down product development lifecycles and enhance testing capabilities. Bajaj Auto R&D also enjoys access to the specialized expertise of leading international design and automobile engineering companies working in specific areas. Based on their own brand of globalization, they have built their distribution network over 60 countries worldwide and multiplied the exports from 1% of total turnover in Fiscal 1989-90 to over 5% in Fiscal 1996-97. The countries where their products have a large market are USA, Argentina, Colombia, Peru, Bangladesh, Sri Lanka, Italy, Sweden, Germany, Iran and Egypt. Bajaj leads Colombia with 65% of the scooter market, in Uruguay with 30% of the motorcycle market and in Bangladesh with 95% of the three-wheeler market. Several new models are being developed specifically for global markets and with these the company will progressively endeavor to establish its presence in Europe too.

Bajaj auto in news recently

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Awards and Achievements:


Product Bajaj wind 125 Bajaj Eliminator Bajaj Pulsar Bajaj pulsar 180 Award Bike of the year 2004 Bike of the year 2002 Bike of the year 2003 BBC viewer choice award Awarding body Business standard Overdrive Overdrive BBC world wheels

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Bajaj Auto Ltd. had several bountiful years with awards galore across its product line.NFO Customer satisfaction and CNBC-Auto Car Auto Awards, the most coveted awards in the industry, were all showered on Bajaj Auto. While ICICI Bank-OVERDRIVE bestowed three awards to Bajaj under various categories including the Bike Maker of the year, BBC World Wheels showered four awards including the viewer choice 2wheeler of the year to Pulsar 180 DTSi, BS Motoring awarded the coveted Bike Of The Year award to Wind 125. NFO, the leading international marketing research firm awarded Bajaj Pulsar for Motorcycle Total Customer Satisfaction in the premium segment. The latest to confer the award, CNBC-Auto Car Award gave the "Two Wheeler of The Year Award" again to Wind 125.

Vehicles :

Co commercial Vehicle

Car Goods Carrier

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Passenger Carriers

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Learnings
During the study of bajaj auto ltd. we found that the definitely the long legacy helps it in business but to be competitive it is needed for the organization to keep change its structure and culture according to the changing market requirements. Also as the company grows the top management need to be more agile. Bajaj targeted its marketing policy on costumer orientation which is necessary for a company which is providing different products for different sections of the society. Bajaj created joint ventures which increased its market differentiation. It restructured its organization structure at important time which really helps in its growth after 2007.

References :www.hindu.com www.busineesline.com www.cmie.com/database www.bajajauto.com www.scribd.com www.moneycontrol.com http://corporatemissions.blogspot.com/2007/10/bajaj-auto.html Books referred
GANDHI'S COOLIE: LIFE AND TIMES OF RAMAKRISHNA BAJAJ BAJAJ CAPITAL INVESTOR'S INDIA: JAN-DEC 2003

Tapmi affiliated databases :- Proquest

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