PROFILE OF VISAKHAPATNAM STEEL PLANT INTRODUCTION Steel occupies the foremost place amongst the materials in use today

and pervades all walks of life. All the key discoveries of the human genius for instance, steam engine, railway, means of communication and connection, automobile, aeroplace and computers, are in one way or other, fastened together with steel and with its sagacious and multifarious application. Steel is a versatile material with multitude of useful properties making it indispensable for furthering and achieving continual growth of the economy be it construction, manufacturing, infrastructure or consumables. The level of steel consumption has long been regarded as an index of industrialization and economic maturity attained by a country. Keeping in view the importance of steel, the following integrated steel plants with foreign collaborations were set up in the Public Sector in the post-independence era: Sl.No Steel Plant . 1. 2. 3. 4. Durgapur Steel Plant Collaborated by Britain

Bhilai Steel Plant Erstwhile USSR Bokaro Steel Plant Erstwhile USSR Rourkela Steel Plant Germany

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Background : To meet the growing domestic needs of steel, Govt. of India decided to set up an integrated steel plant at Visakhapatnam. An agreement was signed with erstwhile USSR in 1979 for cooperation in setting up 3.4 mT integrated steel plant at Visakhapatnam. The foundation stone for the plant was laid by the then Prime Minister on 20th January 1971. The project was estimated to cost Rs.8397.28 Cr. based on prices as on 4th quarter of 1981. However, on completion of construction and commissioning of the whole plant in 1992, the cost escalated to around Rs.8,500 Cr. Unlike other integrated steel plants in India, Visakhapatnam Steel Plant (VSP) is one of the most modern steel plants in the country. The plant was dedicated to the nation on 1 st August 1992 by the then Prime Minister, Shri PV Narasimha Rao. New technology, large-scale computerization and automation etc., are incorporated in the plant. To operate the plant at international levels and attain such labour productivity, the organizational manpower has been rationalized. The Plant has a capacity of producing 3.0 mT of liquid steel and 2.656 mT of saleable steel. VSP Technology: State-of-the-Art 7 meter tall Coke Oven Batteries with coke dry quenching Biggest Blast Furnaces in the country Bell-less top charging system in Blast Furnace 100% slag granulation at the BF Cast House Supressed combustion LD gas recovery system
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 WRM

100% continuous casting of liquid steel Tempcore and Stelmor cooling process in LMMM & respectively Extensive waste heat recovery systems Comprehensive pollution control measures

Major Sources of Raw Materials Raw Material Iron Ore Lumps & Fines BF Lime Stone SMS Lime Stone BF Dolomite SMS Dolomite Manganese Ore Boiler Coal Coking Coal Medium Coking Coal (MCC) Water Supply Operational water requirement of 36 mgd is being met from the Yeleru Water Supply Scheme. Power Supply Operation power requirement of 180 to 200 MW is being met through Captive Power Plant. The capacity of the power plant is 286.5 MW. VSP is exporting around 60 MW power to APSEB. Major Units Department Annual Capacity Units (3.0 MT Stage) Source Bailadilla, MP Jaggayyapeta, AP UAE Madharam, AP Madharam, AP Chipurupalli, AP Talcher, Orissa Australia Gidi/Swang/Rajarappa/Kargali

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Coke Ovens Sinter Plant Blast Furnace Steel Shop LMMM WRM MMSM Melt

(000 T) 2,261 5,256 3,400 3,000 710 850 850

3 Batteries of 67 Ovens & 7 Mtrs. height 2 Sinter machines of 312 Sq. Mtr. grate area each 2 Furnaces of 3200 Cu. Mtr. volume each 3 LD Convertors each of 133 Cu. Mtr. Volume and six 4 strand bloom casters 4 stand finishing Mill 2 x 10 stand finishing Mill 6 stand finishing Mill

Main Products of VSP Steel Products Angles Billets Channels Beams Squares Flats Rounds Re-bars Wire Rods By-products Nut Coke Granulated Slag Coke Dust Lime Fines Coal Tar Ammonium Sulphate Anthracene Oil HP Napthalene Benzene Toulene Zylene Wash Oil

Advent of Centre for Business Systems (CBS) & Corporate Strategic Management (CSM) The CBS was formulated to cater to the strategic needs of Vizag Steel. The focus of CBS is to study world-class initiatives and develop suitable framework for their adoption and implementation on an organization-wide basis at VSP.

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CBS was inaugurated on 18th December 2003. On this occasion, a booklet on Strategies to achieve the Vision, Mission & Objectives of Vizag Steel was released. VSPs Knowledge Management Portal Gnana was launched on 26th July 2004, basically to capture and share unique experience in day to day operations. CBS has four teams to assist other departments in implementation of the initiatives identified and thus guide VSP to achieve its cherished vision of becoming a world-class integrated steel plant. The four teams are: Corporate Management Technology & Automation Marketing Research Intellectual Capital Development The above teams initiate activities pertaining to implementation of various aspects of the Business Excellence Model, alignment and integration of organizational activities through Process Management, research on the latest technological developments in the steel industry for suitable adoption and benchmarking, initiatives leading to improved customer satisfaction, knowledge sharing initiatives like Knowledge Management etc., Groups of self organized employees from different areas of common interest called communities of practices (CoPs) have been initiated which promote collaboration, information exchange and sharing of best practices among them. The CBS has been merged with Corporate Planning Department and renamed as Corporate Strategic Management in order to suit the changing trends.
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Vision, Mission & Objectives Vision To be a continuously growing world-class company We shall Harness our growth potential and sustain profitable growth Deliver high quality and cost competitive products and be the first choice of customers Create an inspiring work environment to unleash the creative energy of people Achieve excellence in enterprise management Be a respected corporate citizen, ensure clean and green environment and develop vibrant communities around us Mission To attain 10 million ton liquid steel capacity through technological up-gradation, operational efficiency and explansion; to produce steel at international standards of cost and quality; and to meet the aspirations of the stakeholders. Objectives Expand plant capacity of 5 million ton by 2007-08 with the mission to attain 10 million ton capacity in two subsequent phases. Wipe out accumulated losses by 2006-07. Be amongst top five lowest cost liquid steel producers in the world by 200607.

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Achieve customer satisfaction levels on par with world class organizations by 2006-07. Make RINL the employer of choice by caring our employees. Develop people as knowledge workers by 2005-06 and achieve an improvement of 5 percentage points in employee satisfaction levels every alternate year. Be ranked as an excellent business organization by 2006-07. Ensure zero effluent discharge by 2005 06 and contribute to improving quality of life (health literacy and water) in at least one village every year.

Core Values Commitment Customer Satisfaction Continuous Improvement Concern for Environment Creativity & Innovation VSP takes all necessary actions for the fulfillment of regulatory requirements. It has dedicated departments for this purpose. Energy conservation, environmental preservation, safety in work place, and occupational health gets highest priority in the company. Some of the policies in this regard are reproduced below.

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Quality, Environment and Occupational Health & Safety Policy : We, at Visakhapatnam Steel Plant, are committed to meet the needs and expectations of our customers and other interested parties, the occupational health and safety of our work force and to preserve the environment. The accomplish this, we will Supply quality goods and services to customers delight. Document, implement, maintain & periodically review the management systems including the policy, objectives and targets. Use resources efficiently and reduce waste & prevent pollution. Comply with all relevant legal, regulatory and other requirements applicable to Products, activities and processes in respect of Quality, Environment, Occupational health & Safety and also ensure the same by contractors. Continually improve quality, environment, occupational health and safety performance with respect to products, activities, processes, premises and services. Encourage development and involvement of employees. Maintain high level of quality, environment, occupational health and safety consciousness amongst employees and contract workers by imparting education and training. Energy Policy

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We, at Visakhapatnam Steel Plant, are committed to optimally utilize various forms of energy in a cost-effective manner to effect conservation of energy resources. To accomplish this, we will

System technologies available forms of energy HR Policy

Monitor closely and control consumption of various forms of energy through an effective Energy Management Adopt appropriate energy conservation Maximize the use of cheaper and easily

We, at Visakhapatnam Steel Plant, believe that our employees are the most important resources. To realize the full potential of employees, the company is committed to: Provide work environment that makes the employees committed and motivated for maximizing productivity Establish systems for maintaining transparency, fairness and equality in dealing with employees Empower employees for enhancing commitment, responsibility and accountability Encourage teamwork, creativity, innovativeness and high achievement orientation

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Provide growth and opportunities for developing skill and knowledge Ensure functioning of effective communication channels with employees

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Customer Policy VSP will endeavour to adopt a Customer-focused approach at all times with transparency VSP will strive to meet more than the Customer needs and expectations pertaining to Products, Quality, Value for Money and Satisfaction VSP greatly values its relationship with Customers and would make efforts at strengthening these relations for mutual benefit IT Policy RINL/VSP is committed to leverage Information Technology as the vital enabler in improving the customer-satisfaction, organizational efficiency, productivity, decision-making, transparency and costeffectiveness, and thus adding value to the business of steel making. Towards this, RINL shall: Follow best practices in Process Automation & Business Processes through IT by in-house efforts / outsourcing and collaborative efforts with other organizations / expert groups / institutions of higher learning, etc., thus ensuring the quality of product and services at least cost Follow scientific and structured methodology in the software development processes with total user-involvement, and thus delivering integrated and quality products to the satisfaction of internal and external customers

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Make the most out of the sate-of-th art technologies in the IT field while going for the suitable cost effective IT infrastructure and software. Ensure high level of date and information security across the organization. Strive to spread IT-culture amongst employees based on organizational need, role and responsibilities of the personnel and facilitate the objective of becoming a world-class business organization Enrich the skill-set and knowledge based of all related personnel at regular intervals to make employees knowledgeemployees Periodically monitor the IT investments made and

achievements accrued to review their cost effectiveness HRD Group Key Initiatives & In-house Training Programs Nominations to External Training Programs Organisation Research, Employees Satisfaction Surveys Voice of Employees Index Organisation Development Membership with Professional Bodies Performance Appraisal for Executives Human Resource Information System In-plant training for Management Students Lectures by eminent personalities

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Corporate Presentations Interactions with professionals, academicians and consultants Knowledge Management Initiatives on Six Sigma Emancipation of women through WIPS, Women Development Programs (Spring Board) Thrust on Samalochana Pursuit of Business Excellence Model (BEM) Dil Ki baat Chairman tho maata

Training & Development RINL believes that the employees are its assets and strives to realise their potential in full for mutual advantage. The human resource development involves development of the employee as a whole. The needs of induction training, skill up gradation, unit training, computer related training, refresher training, foreign training, faculty development etc. are attended by the Training & Development Centre while management development and attitudinal development are taken care at the Centre for HRD. Training in certain specialized areas like safety, fire prevention, occupational health etc. is also taken up by departments specializing in respective fields.

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RINL also provides learning opportunities to individuals by nominating them to external training programmes for enhancing their knowledge. Employees are sponsored for external training programmes including seminars and competitions organised by various professional bodies and institutes like CII, IISI, INSSAN, ASSOCHAM, INSDAG, AIMA, NIPM, LPAI, ISTD, ICWAI, CSI, SCOPE, VSC, QCFI, RDCIS(SAIL), ICA, ASCI, ESCI, XLRI, MDI, BVQI ,WIPS, IIMs,CBI Academy, NPC etc. Employees are sent to other steel plants on short duration tours to find solutions to the various issues facing the company. Employees are also sent to suppliers' manufacturing units / training institutes to get specific training in identified areas. Marketing Network The company markets its products through headquarter marketing office and a network of regional offices, branch offices and stockyards located at 24 centers all over the country. Consignment agents and consignment sales agents located at these centers provide the infrastructure and channels for sale of the products. The exports are carried out by the export wing of marketing division with the help of different agencies. The company is recognized as Star Trading House by the Director General of Foreign Trade, Ministry of Commerce, Govt. of India Pollution Control and Environmental Protection

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Generally, integrated steel plant is seen as a major contributor to environmental pollution as it discharges volumes of waste products. Elaborate measures have been adopted to combat air and water pollution in VSP. In order to be echo-friendly, VSP has planted more than 3.4 million trees over an area of 35 Sq. Kms. and incorporated various technologies at a cost of Rs.460 Crores towards pollution control measures. Human Resource Management Human resource initiatives at VSP are closely linked to the corporate strategy of the organization. VSP has harmonious industrial relations where the entire workforce works as a well-knit team for the progress of the company. The productive environment prevailing in the company fosters an atmosphere of growth - both for the employees and for the company. VSP has introduced multi-skilling concept since inception and the employees are trained to imbibe this. VSP has adopted a system of overlapping shifts - the first of its kind in the industry. This system ensures smooth change over of the shifts and uninterrupted pace of operation of the plant during the shift change over. The labour productivity is currently 282 tonnes/man/year unparalleled in the public sector steel industry. Management of Industrial Relations Presently, 20 registered Trade Unions are functioning at VSP. Out of these, 3 unions viz., Visakha Steel Employees Congress (INTUC), Steel Plant Employees Union (CITU) and Visakha Steel Workers Union (AITUC) have the support of more than 90% of the total votes.

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 Welfare Amenities Welfare has been given the utmost emphasis in the overall policy of Human Resources Management of the Company. Pursuant to this policy, VSP has taken several initiatives for introducing and implementing NonStatutory Welfare schemes which impart and propagate the feeling that the Company cares for its employees. Some of the Non-Statutory Welfare and Social Security Schemes for the benefit of the employees and their family members are detailed below: Housing Facility The Company has a well laid out township Ukkunagaram, consisting of 8,696 quarters with all modern amenities like water supply, underground sewerage, schooling, recreation facilities, parks, shopping complexes, temples, ATMs etc., for its employees. Educational Facilities VSP acts as a catalyst in promoting quality education by encouraging reputed educational Institutions. There are 9 English Medium Schools, 2 Telugu Medium Schools in and around Ukkunagaram and one Junior College. Also there is one English Medium School at each Mine i.e., at Jaggayyapeta and Madharam. Commensurate encouragement exists to provide scholarships (Merit/Merit-cum-means/Cash Awards) to entitled employees and their wards.

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Medical Facilities The company provides comprehensive health care scheme involving

in-patient and out-patient treatment in Company run hospitals and specialised treatment at referral hospitals to the employees and their dependants. Visakhapatnam Steel Plant has established a 160 bedded ultra modern hospital -Visakha Steel General Hospital (VSGH) equipped with sophisticated equipments. Achievements & Awards The efforts of VSP have been recognized in various fora. Some of the major awards received by VSP are in the area of energy conservation, environment protection, safety, quality, Quality Circles, Rajbhasha, MOU, sports related awards and a number of awards at the individual level. Some of the important awards received by VSP are: ISO 9002 for SMS and all the downstream units a unique distinction in the Indian Steel Industry Indira Priyadarshini Vriksha Mitra Award 1992-93 Nehru Memorial National Award for Pollution Control 1992-93 & 1993-94 EEPC Export Excellence Award 1994-95 CII (Southern Region) Energy Conservation Award 1995-96 Golden Peacock (1st Prize) National Quality Award 96 IIM in the National Quality Competition 1996 Steel Ministers Trophy for Best Safety Performance 1996

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Selected for World Quality Commitment Award 1997 of J*BAN, Spain Gold Star Award for Excellent performance in Productivity Udyog Excellence Gold Medal Award for Excellence in Steel Industry Excellence Award for outstanding performance in Productivity Management, Quality & Innovation Ispat Suraksha Puraskar (1st Prize) for longest Accident Free Period 1991-94 Best Labour Management Award from the Govt. of AP SCOPE Award for Best Turnaround 2001 Environment Excellence Award from Greentech Foundation for energy conservation 2002 Best Enterprise Award from SCOPE, WIPS 2001-02 Best Enterprise Award from SCOPE for surpassing MOU targets 2003-04 ISTD Award for Best HR Practices 2002 Prime Ministers Trophy for Best Integrated Steel Plant 2002-03 World Quality Commitment International Star Award in the Gold category conferred by Business Initiative Directions, Paris Organizational Excellence Award for 2003-04 conferred by INSSAN RINL has been bestowed with several national accolades in the year

2005-06 significant among them being : National Energy Conservation Award for the 6th time in succession. National Award for Excellence in Water Management.
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ICWAI Award for excellence in Cost Management. Viswakharma Rashtriya Puraskar Awards (6 out of 32 at the national level). FAPCCI Best Industrial Productivity Award. INSAAN National Award for Organisational Excellence Best CEO Award The above awards are besides a number of awards at the local,

regional & national level competitions in the area of Quality Circles, Suggestion Schemes etc. Hallmark of Vizag Steel as an organization Today, VSP is moving forward with an aura of confidence and with pride amongst its employees who are determined to give their best for the company to enable it to reach new heights in organizational excellence. At the same time, no single advantage accruing from a knowledge society is found wanting by the neighborhood community with the growth & development of a phenomenon called VIZAG STEEL existing so close to its proximity. Futuristic enterprises, academic activity, planned & progressive residential localities are but few of the plentiful ripple effects of this transformation and each one of us take immense pride to uphold the philosophy of mutual (i.e., individual and societal) progress. The remarkable performance on production front coupled with prudent financial management has not only resulted in achieving significant net profits but also helped RINL emerge as a NET POSITIVE

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COMPANY in January, 2006 by wiping out all its accumulated losses during 2005 06

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STATISTICAL INFORMATION

I. Year 19981999 19992000 20002001 20012002 20022003 20032004 20042005 20052006

Production Performance (000 Tonnes) Hot Metal 2,510 2,943 3,165 3,485 3,941 4,055 3,920 4,153 Liquid Steel 2,225 2,656 2,909 3,083 3,356 3,508 3,560 3,603 Saleable Steel 2,193 2,382 2,507 2,757 3,056 3,169 3,173 3,237 Labour Productivity (Tonnes/manyear) 161 192 211 228 253 262 265 282

II.

Commercial Performance (Rs. Crs.) Year 1999-2000 2000-2001 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 Sales Turnover 3,037 3,436 4,081 5,059 6,174 8,181 8,469 Domestic Sales 2,677 3,122 3,710 4,433 5,406 7,933 8,026
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Exports 295 322 371 626 768 248 443

III.

Financial Performance (Rs. Crs.) Year 19981999 19992000 20002001 20012002 20022003 20032004 20042005 20052006 Gross Margin 15 252 504 690 1,049 2,073 3,271 2,383 Cash Profit (-) 346 (-) 130 153 400 915 2,024 3,260 2,355 Net Profit (-) 562 (-) 291 (-) 75 521 1,547 2,008 1,251

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EXPANSION PLAN:

Product Hot Metal CuM Charge Sinter 400 Liquid Steel

Capacity (MT) Present Future 4.00 6.50

Additional Facilities envisaged New BF with 3800 Capacity

5.26

8.50

New Sinter Plant of Sq.M.area

3.70

6.30

SMS-2 with Two 150 CuM Converters, Two 6 Std Billet Casters & One 6 std Round Caster -New Annum WRM of

Saleable Steel Wire Road 600,000T/

3.34 1.05

5.72 1.65

Bars & Structural 1.95 50,000T/

3.40

New SBM of Annum New SM of 700,000 T/Annum

Seamless Pipes

0.30

Seamless Tube plant of 300,000 T/Annum

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