Material conservation, Recycling and Recyclability

Godrej precision engineering is into development of mechanical equipment which primarily uses steel
as basic input material encompassing more than 98% part of product.

Other types of materials being used are Bronzes, rubber seals, etc, depending on the project
requirement.

Table below gives the approximate quantity of raw materials used in year 2013-14.
Material Unit Qty. Source of raw Location and Comments
material (Name of distance (explaining
manufacturer) traveled from purpose of
source (City, material used)
State, km)
Carbon Steel Ton 500 JSW ,ESSAR ,SAIL,etc
Stainless Ton 50 Jindal, Local Stockist
steel
Bronze Ton 2 AMPCO Switzerland

Policy:

Our endeavor is to reduce input material consumption by Increasing Usage of recycled material for
consumption (Cutting Oil, Hydraulic oil in machines); Optimizing the Material consumption plan
through scientific methods(Nesting of Steel Plates, Bars, Pipes , etc. through efficient software like
Most 2D); Increasing the % utilizations of consumables like electrodes, Paints , etc. ;Reducing raw
material requirement by optimal design through FEA; and to increase use of recycled material for
packaging of equipment being supplied by GPE.

Targets:

GPE is in project business wherein material procurement happens against the specific requirement for
the project. [Design department provides optimum material take offs after studying the product
design].

In case of regular standard material grades like MS IS: 2062, procurement is done through 80:20
approach wherein 80% of the material is procured initially, balance 20% requirement is procured mid
project to save on account of improvement in material nesting efficiency during actual manufacturing.

Material surplus after project execution is transferred into centralized project surplus pool which
becomes reservoir for materials to be used for developing fixtures/upcoming projects.
Table below gives the target of project surplus as a percentage of total raw material consumption at
the end of financial year.

Material Units Target for Target for Target for Target for
Year 1* Year 2 Year 3 Year 4
(2014-15) (2015-16) (2015- (2016-2014)
2016)

Carbon steel % 5% 5% 3% 3%

Stainless steel % 10% 8% 5% 5%

1. Initiatives undertaken by GPE for reducing material consumption:

(a). Project Contingency Guideline updated:

Earlier design was adding project contingencies as part of Material requirement as below.
Subsequently, MOQ (Material size and weight) restrictions during procurement were leading to high
amount surplus material with division.
Project contingencies were getting added at multiple stages like design, PPC and purchase.

The guideline has been revised wherein, as per new practice material for contingency will be added
by only by project management team. In case the material is exotic and will require extensive
procurement efforts, design adds contingency with note into MTO document.

(b). Project surplus at the end of project is reviewed by senior management during project closure. In
case of high project surplus leftover, root cause of the same is analyzed and documented for
improvement.
(c). Design department has started nesting using Profile plate nesting software (MOST 2D) instead of
rectangular nesting. Thus increasing the material utilization.

Rectangular Nesting

Profile Nesting

(d). Use of surplus stock for fixture design:

Fixture design of projects is being done considering the surplus stock available with GPE. Surplus stock
list is available on \\filesrv1 server.
 (e) . Standard item for fasteners, electrodes: Fasteners and electrodes which were earlier project
specific items and were ordered against individual project requirement. Before this new initiative
surplus stock of fasteners and electrodes rose significantly due to ordering of excess quantity to meet
project requirement and duplicate ordering (multiple item codes for same part across different
projects) .

With fasteners and electrode converted into standard item, item code of a part will remain universal,
leading clarity in stock of item with division and appropriate decision on ordering.
(f). Residual use of fixtures of completed projects.

Fixtures from past executed projects are being reused rather than scrapping them.

Test stand of CRD project (100054) converted into test stand for Hull equipment (100080)

CO2 chamber created for project 100047 being reused as paint booth in plant 19 and was used as
water reservoir for LRCES (100081) testing.
2. Packaging:

Being involved into development of critical equipment, which requires long term protection during
transportation and storage at customer end, GPE normally uses conventional wooden packing as
below.

With depleting wood reservoir and rising packaging cost, GPE has taken following initiatives to reduce
extent of wood packaging and wood consumption of packaging.

1. Reuse of Packaging boxes:

Packaging boxes received of standard parts like Deutz Engine (MAL), Roundway bearings (Thomson)
were reused for shipment of spares, components to end customer.

2. Large structural components of wind industry are shipped open without packing box (only
shrink wrapping done).
3. Rationalizing the wood content in the packing box by using standard nail-less boxes with
pallets.

4. Moving to palletized packaging from wooden box packing for smaller and lighter components:

(i) Consumes 60% less wood than conventional box.

(ii) Metallic cage is reusable/recyclable.