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An Internship Report


Master of Business Administration
Under the guidance of



Associate to Bharatiya Vidya Bhavan
(Affiliated to Bangalore University)
#43 Race Course Road, Bangalore, 560001.

I NANDINI R, student of Master of Business Administration (MBA), M.P.Birla

Institute of Management, Bangalore here by declares that this report “study on
organization study VOLTAS LIMITED” is a record of independent work
carried out by me, towards partial fulfillment of requirement for Master of
Business Administration (MBA) course of Bangalore University at M.P.Birla
Institute of Management.
To the best of my knowledge this report has not formed the basis for the
award of any other degree.

Place: Bangalore Nandini R

Date: (08XQCM6120)

It’s my privilege in writing this acknowledgement to thank all those who gave
their views and suggestions for helping in the completion of my internship at
VOLTAS LIMITED from 25.06.09 to 30.07.09. I would like to take up this
opportunity to convey my deep sense of gratitude to Prof. Vijayalakshmi.S. my
internal guide and Principal Prof. Dr. Nagesh Malavalli for providing an
opportunity to do this project and internship.
I ardently thank Mr.DHUREEN BABU, area sales manager for having devoted
some of their precious time and for their guidance. I also thank them for the rich
experience that I have derived by working on this project under their guidance.
This project would not have been successful without the constant guidance and
support of my institutional guide, Prof. Vijayalakshmi.S. who took keen interest
in my project to make it a beneficial exercise.
I also extend my thanks to all staffs of the company. Last but not the least, my
thanks to my beloved friends who have helped me a lot during the project for the
successful completion.

Place: Nandini R
Date: (08XQCM6120)
The MBA course offered by the Bangalore University has its own unique syllabus which
requires its MBA students to undertake an internship with any of the leading business houses
for a period ranging from 4 weeks to 6 weeks during the second semester.
India’s premier air conditioning engineering service provider VOLTAS a Tata Enterprise, is a
well established company. It is an Indian company which always maintained the highest
international standards of excellence through quality, technology and innovation. The only
Indian Company with complete core competence in all aspects of air conditioning. For 50
years, Voltas has contributed to the Indian industries modernization and growth. Voltas’ Core
is its ability to provide the best in engineering and back up services.
The company has ISO 9001-2000 certification and has executed projects in the Middle East,
Southeast Asia, Central Asia, Africa and Europe. Voltas captured the various facets of the
Indian economy in sectors ranging from real estate (commercial and residential), retail,
construction, infrastructure, mining etc.
The company's past growth has been achieved without any equity dilution so growth is not
dependent on the vagaries of market. For over a decade, Voltas has been bringing the latest and
very best in Consumer Electronics and Home Appliances. Successfully adapting the best of
international technology to suit Indian needs, and crafting it to improve the quality of life – as
million of satisfied customers will agree.
Report tells the success story of VOLTAS. Sustainability is at the center of Voltas’s strategy.
The report consists of the study of the organization. It involves the Brief profile of the
company, pre-establishment factors that prompted the establishment of the company, location
matrix and milestones in the history of the company. Apart from this; a brief introduction has
been given to the product mix and each departments of the company. The organization also
implemented environment management systems and organization health & safety policy.
Another part contains microscopic study made on success of Voltas commercial refrigeration.
This part contains the introduction of the various products in refrigerator segment, market
characteristics, strategies, factors for Voltas superiority etc.
Sl no Part I Page no.
1 Profile of the company 1
1.1 - Factors that prompted the establishment 6
1.2 - Milestones in the history of the company 8
1.3 - Location matrix 11
2 Company Vision / Mission 13
2.1 - social responsibility 15
2.2 - Energy conservation 15
2.3 - Quality policy 17
2.4 - Ownership pattern 18
3 Company’s policies & product mix 20
4 An overview of labor force 31
5 Company’s performance in recent years 33
6 Organization structure 46
7 Operational aspects of different functional departments 48
7.1 - Human resource department. 49
7.2 -Marketing department. 52
7.3 -Finance & accounting department 54
7.4 -Water management department 56
7.5 -Mining & Construction Equipment Division 57
7.6 -Machine Tools department 58
7.7 -Materials Handling department 58
8 SWOT analysis 59
9 Suggestions &Recommendations 63

Sl no part I I Page no.

1. Introduction 65
2. Product range 66
3. Unbeatable technology 70
4. Eco friendly 72
5. Strategies 72
6. Applications 74
7. Clients 75
8. R & D department 76
9. Voltas superiority 76
10. Key success factors 78
11. Market characteristics 78
12. Demand drivers 79
13. Market shares 79
14. Business concerns 80
15. Recommendations and Suggestions 81
16. Bibliography 82


M P Birla Institute Of Management 1

Company Profile

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Voltas is India's largest supplier of engineering products and services for the textile machinery
sector and is a major manufacturer of forklift trucks. It provides solutions in turnkey pumping
projects for water, effluent and sewage treatment, and water pollution control. The company
has ISO 9001-2000 certification and has executed projects in the Middle East, Southeast Asia,
Central Asia, Africa and Europe.

Historical Background of the company

Voltas Limited is an engineering, air conditioning and refrigeration company based in

Mumbai, India. It offers engineering solutions for a wide spectrum of industries in areas such
as heating, ventilation and air conditioning, refrigeration, electro-mechanical projects, textile
machinery, machine tools, mining and construction equipment, materials handling, water
management, building management systems, indoor air quality and chemicals. The company
has ISO 9001-2000 certification and has executed projects in the Middle East, Southeast Asia,
Central Asia, Africa and Europe.

Voltas is a part of the Tata Group. The Chairman of Voltas is Ishaat Hussein. The managing
director is A. Soni. Its shares are traded on the Bombay Stock Exchange under symbol 500575.
Its 2008 sales were 40,70,25,00,000 rupees.

The Company was incorporated on 6th September, 1954 at Mumbai. . The Company was
promoted in 1954 by M/s. Volkart Brothers and Tata Sons Pvt. Ltd., to take over the
Engineering & Import Division of M/s. Volkart Brothers in India. Corporate Headquarters is at
Voltas House, "A" Block, Dr. Babasaheb Ambedkar Road, Chinchpokli, Mumbai 400 033,
Maharastra. The Company's manufacturing activities were originally carried on at its factory at
Chinchpokli, Mumbai and covered air-conditioning and refrigeration equipment mining,
electrical and agricultural equipment.

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The Company's distribution organization is divided into two main groups - `Engineering' and

The marketing group consists of two main divisions, one dealing in drugs, pharmaceuticals and
consumer products and the other in chemicals and vitamins. The Company deals in foreign as
well as indigenous products, besides marketing its own products.

The Company manufactures sale and distribution of a variety of products in the engineering,
chemical and pharmaceutical industries such as agricultural, earthmoving, air-conditioning and
refrigeration, textile machinery, machine tools, electrical and mechanical equipments as well as
chemicals and pharmaceuticals.

The Company set up in Thane, Mumbai an up-to-date factory to manufacture wide range of
air-conditioning and refrigeration and a range of mining equipments for which the Company
had entered into collaboration with leading manufacturers abroad.
. Some of Voltas' collaborations are with:

• Besseling, Netherland, for Controlled Atmosphere (CA) / Ultra - Low Oxygen (ULO)
storage technology.
• Bock - Germany, Refcomp - Italy and JE Hall - UK, for Semi - Hermetic compressor
• Costan of Italy, for Refrigerated Cabinet Display Units for hyper market engineered
• Dunham-Bush Incorporated (USA), for screw chillers
• Hitachi Limited, Japan, for vapor absorption machines
• MIDEA, China, for Variable Refrigerant flow Systems.
• Ruks Engineering, Canada, for ozone engineered systems
• Standard Refrigeration Company (USA), for direct expansion chillers
• Siemens Building Technologies (Asia-Pacific), for building management systems

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The company is also an Indian representative of a number of leading manufacturers worldwide.
To name a few:

• BT, Sweden
• Bruckener, Germany
• Erbatech, Germany
• Fanuc Ltd. , Japan
• Hercules - Aqualon Division, USA
• Huntsman Tioxide, UK
• Hyundai, Kore
• Kobelco, Japan
• Kluber, Germany
• LeTourneau Inc., Australia
• LMW, India
• Memminger, Germany
• Mitsubishi Heavy Industries, Japan
• Terex - BL-Pegson, UK
• Terex - Powerscreen, UK
• Terex - O&K, Germany
• Terrot , Germany
• Tornos , Switzerland

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Voltas's operations have been organized into three independent business-specific clusters. Each
of these has its own facilities for market coverage and service to customers.
1. Electro-Mechanical Projects & Services
• Electrical, Mechanical, HVAC & Refrigeration Solutions
• Electrical, Mechanical & HVAC Solutions (International)
• Water Management & Treatment

2. Engineering products & Services

• Textile Machinery
• Mining & Construction Equipment
• Machine Tools
• Materials Handling Solutions

3. Unitary Cooling Products for Comfort & Commercial Use

• Cooling Appliances
• Commercial Refrigeration

1.1 Factors that prompted the establishment of company

Voltas Ltd was formed in 1954, as a joint venture between Tata's and Volkart Brothers; it was
already a century old in all but name. In fact, the alliance itself resulted from the need to
preserve that legacy, to carry forward that capability under changed post-war post-
Independence conditions.
Since 1853, Volkart had been prominent in 'two-way' trade between India and the West.
Broadly, raw materials and commodities were exported, while imports focused on machinery
and engineering equipment from overseas manufacturers.

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Over the years, such technology-based products increasingly needed installation and support
services. This evolved into Volkart's Engineering & Import business, which soon formed the
bulk of their activities.
Post-war and post-Independence realities called for drastic revisions. India's manufacturing
capabilities had been jump-started by wartime conditions. Independent India too was intent on
forcing the pace of indigenization, by restricting imports of engineering equipment (among
others). Paradoxically, India's industrial and economic growth would require more and more
such equipment. Volkart's installation and support services would be in great demand if the
equipment could be sourced.
Volkart and Tata's teamed up as Voltas Limited to tackle these challenges. It was the ideal
combination: Volkart's engineering services and trading expertise, allied with Tata's historic
standing as a major industrializing power which was aligned with the many new markets
springing up in post-Independence India.


Voltas has received many prestigious awards like:

• United Nations' Grand Award for Excellence in Public Service Worldwide, 1993-94.
• International Public Relations Associations' Golden Trophy for Excellence in Customer
Service, 1994-95.
• Mumbai Chamber of Commerce and Industry's Good Corporate Citizenship Award,
• Export Excellence Award, as Star Performer received from Engineering Export
Promotion Council (EEPC) India - Western Region, 2006-07.
• MEP Middle East Awards 2008.

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1954 - The Company was incorporated on 6th September 1954

1963 - The Company promoted Scottish Indian Machine Tools Ltd., in Collaboration
with Scottish Machine Tool Corporation of Glasgow for the manufacture of
machine tools.

1964 - The Company concluded a collaboration agreement with Eaton Yale and
Towns, U.S.A., for the manufacture of Yale fork-lift trucks.

1966 - A new division, viz., the Agro-Industrial Products Division was added. The
main operation of the division consisted of the sale and servicing of the tractors
and implements made by the International Tractor Co. of India.

1979 - With effect from 1st July, Tata-Merlin & Gerin Ltd. (TMG), and the National
electrical Industries Ltd. (NEI), was amalgamated with the Company.

1982 - The Company proposed to set up an electrical business unit at Pune.

- The Air Pollution and Water Pollution project groups were amalgamated with
the Electrical project group.

1988 - The material handling business group successfully introduced up-to-date

warehousing equipment to further enlarge its product range.
- Air-conditioning and refrigeration business group received Government's
approval for the technical collaboration agreement conveying large-sized
efficient compressors.

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1989 - With effect from 1st March, Volrho Ltd. was amalgamated with the Company
as per the order of BIFR.

1990 - The materials handling business group proposed to extend its scope of
activities to turn-key materials handling systems for mass production in
engineering industries.

1991 - The performance of the industrial machinery division was adversely affected
due to a lock-out at the Company's principal, Westerworks.
- The Agro-Industrial Product Division successfully tested to international
standards, the indigenously built 36 KV SF6 breaker at CESI Test Laboratory,
Milan, Italy.

1992 - The Company restructured its operations into product group I comprising
refrigerators, pharmaceuticals and consumer products and beverages while
product group I(A) include textile machinery. Product group II consisted of
machine tools, materials handling facility, industrial machinery, air-
conditioning pumps and projects. Group III comprised of chemicals plant,
chemicals division and agro-industrial products.
- Air-conditioning and refrigeration business and agro-industrial products and
pumps division suffered a setback due to prevailing recession in the market and
non-availability of Government funds as well as disturbances from December.

1993 - The cooling appliances business launched four new products viz., water
coolers filled with purifiers ductable and slim-line 3 tone air-conditioners,
ceiling mounted split in 1.5 and 3 tone capacities and 2 tone room split units.
- The pharmaceutical and consumer products division was closed during the
year and had also withdrawn from the beverages business.

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- HAL, a sick industrial company, was merged with Voltas and the
amalgamation was approved by the Board for Industrial & Financial
Reconstruction (BIFR) in 1994.

1995 - Voltas gets Good corporate citizen award

- The Company has introduced `Soft Look' models of refrigerator in165 L. &
200 L segments. Company is also launching a premium Frost Free Refrigerator
in collaboration with Hitachi.

1997 - A whole range of new products was launched both in the room air
conditioning and split segments. The heavy equipment and packaged system
division launched ozone-friendly centrifugals and superior quality energy
efficient steam, fired vapor absorption machines with Hitachi’s `Para flow'
- Voltas, India's leading air-conditioning company has been chosen to supply,
erect and commission high-tech climate air-conditioning system for India's first
information technology park.

1999 - Air International Ltd. is a joint venture between Voltas Ltd. and Air
International Grmp, Australia.

2000 - The Company has received a special award for completing the electro
mechanical pumping project of Ahmadabad Municipal Corporation in 120 days.
- The Company has introduced a voluntary retirement scheme called Early
Separation Scheme 2000 (ESS) for its employees.
- The Company has sold its wholly-owned subsidiary Voltas Foods &
Beverages to a Mumbai-based company, and has roped in a multinational as
strategic partner for Perfect Moulds.

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2001 -Relaunching Voltas air conditioners under the `Verdant' brand, a premium
model targeted at the retail segment.

2002 - N D Khurody appointed as Additional Director of Voltas.

2004 -Voltas has launched a range of small capacity refrigerators targeted

at semi-urban and rural markets in India.
- Chinese consumer durable giant Haier enters into a contract manufacturing
agreement Voltas Ltd for air-conditioners and refrigerators.
-Voltas introduces new range of water dispensers.

2005 -Voltas secures order for world's Tallest building, burj towers, dubai

2007 -Voltas Ltd has informed that Universal Comfort Products Ltd (UCPL) is a
50:50 joint venture Company between Voltas and Fedders International Air-
conditioning Pvt Ltd (FIACPL), a subsidiary of Fedders Corporation, USA.

2008 -Voltas Ltd has appointed Mr. Jimmy Bilimoria and Mr. S N Menon,
Independent Directors have as Additional Directors of the Company with effect
from September 22, 2008.


The Company has its head office in Mumbai.

The head quarter is present on 4 zones in India. West zone head quarters in Mumbai, East
zone head quarters in Kolkata, North zone head quarters in New Delhi and South zone head
quarters in Chennai.

The branch offices are widely distributed throughout India in many places as territorial and
area offices at Ahmadabad, Baroda, Bangalore, Calicut, Coimbatore, Chandigarh, Delhi,

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Ghaziabad, Indore, Jaipur, Hyderabad, Jamshedpur, Kolhapur, Lucknow, Ludhiana, Madurai,
Panjim, Pune, Secunderabad, Surat, Tirupati, Thirupur, Vijayawada, Vishakapatanam and
Kochi which forms a responsive network across nation to cater to the demands.

Currently 4 factories are set up in India as Thane Plant (Maharastra), Dadra Plant (EM&RBG),
Uttarakhand Plant (EM&RBG), Uttarakhand Plant (UPBG)

Voltas has established its operations overseas and overseas offices are located in Dubai, Abu
Dhabi (UAE), Hong Kong, Kingdom of Bahrain, Singapore, Qatar, United Kingdom and

Subsidiaries and associate companies are

There are many subsidiaries complementing Voltas.

• Auto Aircon (India) limited, Pune

• Simto Investment Co. Ltd, Mumbai
• Metrovol FZE , Dubai
• Weathermaker limited, Dubai
• VIL Overseas Enterprises B.V., Amsterdam
• Voice Antilles N.V., The Netherlands Antilles
• Joint Ventures are:
• Universal Comfort Products Private Limited, Dadra
• Universal Voltas L.L.C. Abu Dhabi, UAE
• Saudi Ensas Co. Ltd, Jeddah
• Lalbuksh Voltas Engineering Services & Trading Company L.L.C., Muscat

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Chapter- 2
Company Vision &

M P Birla Institute Of Management 13



“Ever-changing times, never-changing spirit”

Voltas has developed a vision for itself that will take it further on the path to prosperity.
Megavol is the plan to achieve Rs10,000 crore in sales at a profitability of 10 per cent by the
end of 2010-11.


a. To foster indigenous manufacture of engineering products and capital equipment, based

on technologies acquired from overseas, often from Volkart's existing principals

b. To supply the full gamut of services, from marketing to commissioning, for such


• Commitment to excellence – Tata Business Excellence Module (TBEM)

• Commitment to HRD
• Commitment to good corporate citizenship
• Commitment to Corporate Governance

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Voltas, true to the Tata tradition of improving the quality of life, has long regarded
participation in social development as a whole-hearted preoccupation that enriches the
corporation itself. Voltas has always gone beyond its traditional business and industrial
concerns to involve itself in projects that bring about upliftment in the lives of the under
privileged and the deprived.

The concern springs from a deeply held belief that a true corporate vision must encompass
more than those to whom the Company markets its services and products. Voltas
understands that the time and resources thus invested and the professional expertise shared
with the nation come back to the corporation in the long run as expected dividends of
reputation, opportunity and acceptance.

The declaration of the Tata Council on Social Responsibility is disseminated to all

employees through internal communications, since all are expected to be aware of the
declaration. Reporting on community initiatives is regularly done through the intranet. The
community is central to the core values we adhere to in the Tata Group.

If Voltas has a core, it is its businesses. If Voltas has a heart, it is its volunteers


It's in the very nature of Voltas' core businesses to be actively engaged in today's Green
movement. Every day, the need to conserve energy, preserve the ecology and minimize
man's carbon footprint become more and more imperative. That's a call which Voltas
answers through its products, its services, and its operating principles Low-cost cooling
begins at home Voltas minimizes wasteful energy consumption in

M P Birla Institute Of Management 15

its branded products. In fact, Voltas has long been a pioneer in microprocessor controlled
room ACs for optimal energy usage. Sophisticated control systems in its air conditioning
projects (the V-SCADA technology) as well as built environments (Building Management
Systems) also help optimize energy usage through continuous monitoring and regulation.

Most recently, Voltas broke through in lowering operating costs for household AC users --
by being first-to-market with the new generation 'Star-Rated' ACs. Rigorously tested and
certified for energy-efficiency, the new product line gave Voltas the lead in reaching a
whole new stratum of small town and rural buyer. The lowering of energy bills broke down
their last resistance to home cooling. Systems and solutions that save on a far larger scale,
Voltas' 'green' touch is seen in its Heating, Ventilation and Air Conditioning projects. The
Company offers a unique combination of Engineered Ozone Systems for purer air quality,
along with VRF (Variable Refrigerant Flow) technology for cooling. Installed together and
working in synergy, they make a marked impact on cooling costs. Customers can breathe
easier, for more reasons than one.

Energy-efficient technologies, 'intelligent' building management, purer air for better health
-- they add up to a full portfolio for today's 'Green' buildings. These are sure to become
more and more the rage, in step with the ongoing energy and climate crises. Voltas is right
there with the solutions desired. The high water mark of pollution control When Voltas'
Water Management business successfully completed its world-class water purification
project in Singapore; it was the capstone of more than two decades in treating wastewater
and effluents. All its built-up knowledge and experience were brought into play in the
Changing Water Purification Plant, one of the largest of its kind anywhere. Its success now
opens the way for more such large-scale and complex water management jobs, meeting
today’s urgent need for water conservation and reclamation. Once again, Voltas responds
to the needs of the times and the concerns of its stakeholders. The Company is ready with
the products, the processes, the people -- and most importantly, the principles.

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Voltas strives to provide a safe, healthy, clean and ergonomic working environment for its
people. It prevents the wasteful use of natural resources and is committed to improving the
environment, particularly with regard to the emission of greenhouse gases, and endeavours to
offset the effect of climate change in all spheres of its activities.
Voltas , in the process of production and sale of its products and services, strives for economic,
social and environmental sustainability’s.


Voltas is committed to supply goods and services of world class quality standards, backed
by after-sales services consistent with the requirements of its customers, while striving for
their total satisfaction. The quality standards of the company’s goods and services meet
applicable national and international standards.
Voltas displays adequate health and safety labels, caveats and other necessary information
on its product packaging.

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Share holding pattern as on :30/06/2009 31/03/2009 31/12/2008

Face value 1.00 1.00 1.00
No. Of % No. Of % No. Of %
Shares Holding Shares Holding Shares Holding
Promoter's holding
Indian Promoters 91532655 27.66 91748655 27.73 91241055 27.57
Sub total 91532655 27.66 91748655 27.73 91241055 27.57
Non promoter's holding
Institutional investors
Banks Fin. Inst. and Insurance 53092271 16.05 53399873 16.14 51093918 15.44
FII's 34785600 10.51 37411643 11.31 50507438 15.26
Sub total 13381593140.44 12730917638.48 13831166541.80
Other investors
Private Corporate Bodies 26796703 8.10 28319977 8.56 26449301 7.99
NRI's/OCB's/Foreign Others 3880750 1.17 4546574 1.37 3835475 1.16
Sub total 30671453 9.27 32860551 9.93 30278776 9.15
General public 74858701 22.62 78960358 23.86 71047244 21.47
Grand total 330878740100.00 330878740100.00 330878740100.00

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Chapter 3
Company’s policies &
product mix

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The cornerstone of the Voltas philosophy is the conviction that the well-being of the company
and of its people are interdependent; and that the company's most valuable assets are its people.
The company is committed for following:

• To employ the most competent, on the basis of merit

• To ensure that every employee is treated with dignity and respect, and in a fair,
consistent and equitable manner
• To create a stimulating, enabling and supportive work atmosphere
• To aid and encourage employees in realizing their full potential
Voltas recognizes that the success of this philosophy depends in a large measure on the manner
in which managers and their team members - at every level - carry out their duties and
obligations to each other and to the company. Without mutual confidence and loyalty among
employees, as well as respect for each other as human beings, our philosophy will not work.

• Have knowledge of, and accept total responsibility for, the success of the organization’s
human resources philosophy, policies and procedures, and review them with team
members to ensure their total understanding.
• Ensure consistent and fair application of all HR policies
• Exercise leadership by demonstrating integrity, professional knowledge, courage of
your convictions, and concern for the feelings of others.
• Establish a relationship with team a member that encourages a free bi-directional flow
of information, permits open discussion of differing views, and allows decision making
at the most appropriate levels.

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• In the same context, all employees are expected to maintain certain standards in relation
to their work, and in representing themselves as the staff of Voltas. They will:
1. Communicate constructive ideas and opinions to managers and team members either
pro-actively, or on request
2. Accept and support decisions made contrary to their expressed positions
3. Apply the highest standards of ethics, integrity and honesty.

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Voltas' operations have been organized into four independent business-specific clusters,
each with its own facilities for market coverage and service to customers.

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Segment A : Electro-mechanical Projects & Services
• Domestic and International MEP solutions (including HVAC) in built
and industrial environment.
• water management and treatment
Segment B :Engineering Products & Services
• Mining and Construction Equipment, Materials Handling, and Textile
• Machinery.
Segment C: Unitary Cooling products for comfort and commercial use
• Room air conditioners
• Commercial Refrigeration

The various products of the Tata Voltas are

Air Conditioners

Superior Features, Unbeatable performance, Stylish ACs, that not only cool, but saves
power. Presenting Voltas range of Energy Efficient Star Rated Split and Window ACs.
Voltas ACs has energy efficient compressors that ensure perfect cooling at minimal

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Commercial Refrigeration

Sturdiness, efficiency and superior design, featuring state-of-the-art technology, Voltas

Freezers and Coolers not only consume less power but also withstand long power cuts.
Add to this the trust of TATA, Voltas sets the benchmark for the industry. Backed by a
quick and friendly Customer service, Voltas products know the worth of every rupee.

Water Cooler

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The success of every office, institute and establishment depends on the efficiency
of its most valuable assets. These assets are none other than its employees. And to
keep them going, they need to be recharged. That's what the Tushar range of
Water Coolers have been doing since 1964. They hold a prominent place in
thousands of establishments across the Country, for they provide cool water round the
clock. No Wonder, we call them the official thirst quenchers of India.

Water Dispenser

A perfect blend of beauty and brains, the new mini magic is what every office, home
and shop need. Experience the versatility of water. Hot enough to stimulate y with a
cup of tea or coffee and cold enough to refresh with a glass of pure water or with a soft
drink concentrate. An ode to nature's most marvelous gift.

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Segment-wise break-up
Electro-mechanical: Core business of the Company
Operating Profits: Rs 3277 Mn. (USD 65 Mn.)
31st March, 2009

Electro-Mechanical Projects and Services

Engineering Products and Services
Unitary Cooling Products for Comfort & Commercial Use

Operating Profits : Rs 29367 Mn. (USD 74 Mn.)

31st March, 2008

Electro-Mechanical Projects and Services

Engineering Products and Services
Unitary Cooling Products for Comfort & Commercial Use

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• Contributes 63 % to the Company’s TO

• Domestic business contributes 25% of the Company’s TO
• International business contributes 38% of the Company’s TO.
• Order book of 1000 cr as of 31st. March 2009
• In the domestic market:
• Expanded the scope of services from Air conditioning to MEP -Mechanical (including
air conditioning), electrical and public Health for built environment.
• Bagged/executed large orders such as the Rajiv Gandhi International Airport, Godrej IT
park and 65% of the stadium projects for Commonwealth Games.
• Rajiv Gandhi International Airport was the first airport in Asia to be awarded the LEED
• ‘Green” projects in progress are Lodha Excellus, Mumbai; Wave Rock-,TSI Venture,
Hyderabad; RMZ Business Park, Chennai: TCS Bhubaneswar.
• MEP business grew by 94 % over last year
• Completed the execution of the single largest VRF installation in India, with a capacity
of 3000 TR, for TCS’ Kensington IT Park, at Poway.
• In Q1:
• Bagged MEP orders for two prestigious international airport, worth Rs 300 Cr. –
Kolkata and Chennai to be competed in 21-24 months -Undisputed leader in the Airport
segment for MEP services
• Renewed thrust in the Water Management business has resulted in securing two
prestigious orders worth Rs 38 Cr. from Kolkata Metropolitan Water & Sanitation
Authority and Tata Steel.

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• Contributes 13 % to the Company's TO.

• Impacted by the downturn in the Indian economy, especially in the second half.
• Resulted in marginal dip in TO.
• Profitability dropped by 40%.
• Focused on growth opportunities in coal mining and power plant construction, led to higher
sales of mining equipment, arts and services..
• The sale of forklifts showed a reduction of around 8% by volume, but increased the sale of
cranes and warehousing equipment.
• In Textile machinery, the actual off take was very low.
• In anticipation of opportunities in post spinning, tied up with new International manufactures
for new product lines – dyeing machinery and weaving looms.

In Q1

• Bagged order worth Rs. 210 Cr. From Hindustan Zinc Limited supply of worlds second
biggest model of hydraulic excavators manufactured by O&K + a maintenance contract for 5


• Contributes 23 % to the Company's TO

• Indian air conditioner industry witnessed a slowdown in growth, from 28% to 6% also
resulting in high inventory levels in the industry
• Voltas air conditioner sales registered a growth of 8%
• Voltas room air conditioner sales grew by 24% in volume. within the highly
competitive multi-brand retail segment well above the industry average of 7%
• Increased reach in semi-urban and rural markets, by expanding the network of dealers.

M P Birla Institute Of Management 29

• Introduced new products, spanning the entire spectrum, right up to the highest 5-Star
rated Vertis Gold Split air conditioners, and the innovative Corner air conditioners
• The service infrastructure was strengthened by the addition of an all-India toll-free
• Restructured the Commercial Refrigeration operations into a separate vertical; resulted
in a higher sales growth of 34% in the Chest Cooler segment, and 87% in the Visi
Cooler segment

M P Birla Institute Of Management 30

Chapter- 4
Labor Force

M P Birla Institute Of Management 31


Human Resource capability remains a key source of the Company’s competitive advantage.
The Company continues to place emphasis on enhancement of skills and capabilities of its
people for meeting future challenges. The key areas of human resource
Developments are training, competency development and skill enhancement. The Company
continues to implement best practices and innovative initiatives to meet the challenges in
acquiring and retaining talent against intense competitive pressures. As the Company takes on
projects with higher complexities and expands its business, the need to reinforce the human
resource capabilities becomes more critical.


The total staff strength as on 31st March, 2009 was 10657, including 6228 contract staff,
primarily for overseas projects.


Staff Expenses comprise salary, wages, bonus, Company’s contribution to PF and other funds,
retiring gratuity and welfare expenses. Staff expenses increased by 55% in 2008-09 to
Rs.428.59 crores from Rs.276.85 crores in 2007-08, basically due to increase in manpower
including contract employees for overseas projects. While Staff Expenses for domestic
businesses increased by 17% in 2008-09 to Rs.185.86 crores from Rs.159.51 crores in 2007-
08, the increase in international business was substantially higher by 107% at Rs.242.73 crores
as compared to Rs.117.34 crores in 2007-08, primarily due to significant increase in
manpower, for large overseas projects.

M P Birla Institute Of Management 32

Company’s Financial

M P Birla Institute Of Management 33

Financial performance as a measure of operational Performance

Year ended March 31, 2009

• Operating profit at Rs335 crore, up by 21 per cent

• Sales / income from operations at Rs4,070 crore, up by 32 per cent
• Profit after tax at Rs253 crore, up by 21 per cent
• EPS at Rs7.63 as against Rs6.30

Year ended March 31, 2009

The company’s operating profit (profit before tax and exceptional items) rose by 21 per cent to
Rs335 crore as compared to Rs278 crore in the previous year. Profit after exceptional items
and tax rose by 21 per cent to Rs253 crore as against Rs208 crore in the previous year.

Sales and Services, net of Excise duty, increased by 32% in 2008-09 to Rs.4042.55 crores from
Rs.3055.36 crores in 2007-08.In Electro-mechanical Projects and Services segment, the
increase in revenue was 55% from Rs.1641.09 crores in 2007-08 to Rs.2546.43 crores in 2008-
09. Revenue of Engineering Products and Services segment was lower by 2% and was
Rs.542.19 crores in 2008-09 as compared to Rs.553.49 crores in 2007-08. The Company
registered a growth of 11% in its Unitary Cooling Products for Comfort and Commercial Use
segment and reported higher revenue of Rs.913.75 crores in 2008-09 as compared to Rs.
820.99 crores in 2007-08.
Revenue from ‘Others’ was higher by 1% in 2008-09 at Rs.40.18 crores as compared to
Rs.39.79 crores in 2007-08.

M P Birla Institute Of Management 34

5.2 Balance Sheet
5.2.1 Working Capital
The Company continued on its path of growth and took several measures to ensure
sustainability for the future in the face of global economic slowdown.

The Company continued its focus on tailoring its offerings of projects, services and products to
the present market realities and dynamics. Significant steps in this direction have been a
corporate acquisition, as well as additions to the roster of principals and the range of products
offered. There have also been significant measures to rationalize costs in the interests of a
short-term ‘holding action’, till such time, some clarity emerge with regard to future trends in
global economy.

Voltas’ operating profits have grown 532% over a period of last four years.

M P Birla Institute Of Management 35

The business segments of the Company are :
(A) Electro-mechanical Projects and Services
(B) Engineering Products and Services
(C) Unitary Cooling Products for Comfort and
Commercial Use
(D) Others

M P Birla Institute Of Management 36

Earnings summary
Balance sheet
Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05 Mar ' 04
Sources of funds
Owner's fund

Equity share capital 33.07 33.07 33.06 33.06 33.06

Share application money - - - - -
Preference share capital - - - - -

Reserves & surplus 505.25 347.68 208.35 160.46 155.95

Loan funds
Secured loans 47.67 82.14 47.01 74.47 52.08

Unsecured loans - - 25.00 31.94 31.15

Total 585.99 462.90 313.42 299.92 272.24
Uses of funds

Fixed assets
Gross block 263.02 238.89 269.76 241.63 246.43
Less : revaluation reserve - - - - -
Less : accumulated
122.28 115.06 145.92 166.15 124.81
Net block 140.75 123.84 123.84 75.48 121.62
Capital work-in-progress 18.75 6.03 10.99 6.95 0.97

Investments 267.93 137.41 61.03 46.22 45.47

Net current assets
Current assets, loans &
1,580.15 1,287.29 984.24 898.33 751.82

M P Birla Institute Of Management 37

Less : current liabilities &
1,421.59 1,091.68 866.68 727.06 647.64
Total net current assets 158.56 195.61 117.56 171.27 104.18
Miscellaneous expenses not
- - - - -
Total 585.99 462.90 313.42 299.92 272.24
Book value of unquoted
268.44 137.44 45.86 50.02 47.46
Market value of quoted
103.54 187.85 10.17 54.15 33.58
Contingent liabilities 227.47 224.09 214.99 269.94 291.60
Number of equity 3308.85 3308.85 330.88 330.88 330.88

M P Birla Institute Of Management 38


M P Birla Institute Of Management 39


Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05 Mar ' 04
Operating income 3,044.54 2,400.55 1,853.14 1,386.66 1,273.19
Material consumed 2,240.09 46.24 -23.77 213.71 550.70
Manufacturing expenses 6.98 1,774.67 1,431.78 825.21 513.76
Personnel expenses 276.85 239.97 176.23 144.35 132.76
Selling expenses 73.35 44.48 35.17 30.09 31.70
Administrative expenses 193.59 177.09 132.31 130.34 126.32
Expenses capitalized - - - - -105.66
Cost of sales 2,790.86 2,282.45 1,751.73 1,343.70 1,249.59
Operating profit 253.68 118.10 101.41 42.96 23.61
Other recurring income 45.89 64.35 24.58 25.57 22.43
Adjusted PBDIT 299.57 182.45 125.99 68.53 46.04
Financial expenses 5.96 9.40 5.19 7.24 6.73
Depreciation 13.56 12.32 11.09 10.48 13.25
Other write offs - - - - -
Adjusted PBT 280.04 160.73 109.71 50.81 26.06
Tax charges 99.17 41.42 21.20 7.39 7.73
Adjusted PAT 180.87 119.31 88.51 43.42 18.33
Nonrecurring items 27.50 60.79 -52.27 7.06 12.67
Other non cash adjustments - 5.98 6.52 -0.07 8.03
Reported net profit 208.37 186.08 42.76 50.41 39.03
Earnings before appropriation 248.37 210.94 62.76 65.41 49.03
Equity dividend 44.67 33.09 19.85 16.54 9.93

M P Birla Institute Of Management 40

Preference dividend - - - - -
Dividend tax 7.59 5.62 2.78 2.35 1.27
Retained earnings 196.10 172.22 40.12 46.52 37.83

Financial leverage
Cash flow statement

Mar ' 08 Mar ' 07 Mar ' 06 Mar ' 05 Mar ' 04

Profit before tax 307.54 222.83 91.69 57.66 46.87

Net cash flow-operating activity 345.83 1.66 48.94 43.77 -22.83

Net cash used in investing activity -131.80 51.35 -30.95 3.13 46.60

Net cash used in fin. activity -79.07 -21.39 -55.02 7.18 -22.32

Net inc/dec in cash and equivalent 134.96 31.62 -37.03 54.08 1.45

Cash and equivalent begin of year 140.25 108.63 145.66 91.58 90.13

Cash and equivalent end of year 275.21 140.25 108.63 145.66 91.58

M P Birla Institute Of Management 41

Key ratios

Conclusion: Voltas reported strong F1Q08 results, underpinning positive momentum in the
overall business dynamics and the possibility of operating margin expansion. However,
valuations look expensive, and any slowdown in margin expansion may be negative for the

M P Birla Institute Of Management 42

Operational performance:
Financial performance as a measure of Operational Performance

Sales and Services (Segment Revenues):

Sales and Services, net of Excise duty, increased by 32% in 2008-09 to Rs.4042.55 crores from
Rs.3055.36 crores in 2007-08. In Electro-mechanical Projects and Services segment, the
increase in revenue was 55% from Rs.1641.09 crores in 2007-08 to Rs.2546.43 crores in 2008-
09. Revenue of Engineering Products and Services segment was lower by 2% and was
Rs.542.19 crores in 2008-09 as compared to Rs.553.49 crores in 2007-08. The Company
registered a growth of 11% in its Unitary Cooling Products for Comfort and Commercial Use
segment and reported higher revenue of Rs.913.75 crores in 2008-09 as compared to Rs.
820.99 crores in 2007-08. Revenue from ‘Others’ was higher by 1% in 2008-09 at Rs.40.18
crores as compared to Rs.39.79 crores in 2007-08.

M P Birla Institute Of Management 43

M P Birla Institute Of Management 44

Voltas reported a top line of Rs8.6bn, a growth of 30% YoY, for Q3FY09. This growth was
ably supported by the MEP division, which grew by 68% YoY as compared to a de-growth of
31% and 5% in engineering and unitary cooling, respectively. EBITDA margins during the
quarter decreased by 254bps YoY to 5.7%, mainly due to a lower margin in both engineering
and unitary cooling(9.8% and 0.7%, respectively). Another reason for the lower margin was an
additional charge of Rs60m, which was included in the employee cost on account of
revaluation of employee benefit. PAT increased by 11% YoY to Rs424m, on the back of
interest income of Rs20m on account of settlement of claims and lower tax rate due to a tax
reversal of Rs10m.

M P Birla Institute Of Management 45

Organizational Structure

M P Birla Institute Of Management 46

Organization structure
The board of directors consists of chairman ishaat hussain followed by the managing director
A soni and 8 directors Nasser munjee, N J jhaveri, S D kulkarni, ravi kanth, N D khurodey, N
N tata, jimmy bilimoria, S N menon.

Organization chart Chairman

Managing Director



Vice President

General Manager

Finance & commercial Human Sales & Services Business

Resource Improvement

Chief Financial Sales Manager


Independent Channel Financial Planning

Advisors Sales Officer Consultants

M P Birla Institute Of Management 47

Chapter- 7
Departments in Voltas

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There are various departments in the organization. The major departments are:
• Human resource department.
• Marketing department.
• Finance & accounting department.
• Water management department
• Mining & Construction Equipment Division (M&CE)
• Machine Tools department
• Materials Handling department


Human Resource capability remains a key source of the Company’s competitive advantage.
The Company continues to place emphasis on enhancement of skills and capabilities of its
people for meeting future challenges. The key areas of human resource
Developments are training, competency development and skill enhancement. The Company
continues to implement best practices and innovative initiatives to meet the challenges in
acquiring and retaining talent against intense competitive pressures. As the Company takes on
projects with higher complexities and expands its business, the need to reinforce the human
resource capabilities becomes more critical.

During the year, over 3000 personnel were deployed in international projects - recruited from
India, UK, Romania, Sri Lanka, Nepal, Bangladesh, Philippines and GCC countries. Technical
Training Programs were conducted in India at ten ITIs and two Polytechnics, to provide project
specific training to about 800 technicians, before deployment.

M P Birla Institute Of Management 49

The Company’s focus on improved Employee Engagement and ushering in a proactive work
culture, through several enterprise level initiatives has been noteworthy. Employee Contact
Programs have helped in obtaining valuable feedback and implement appropriate
action plans.

The Company continues to place emphasis on enhancement of skills and capabilities of its
people for meeting future challenges. The key areas of human resource development are
training, competency development and skill enhancement. Career Development Plans have
been evolved for high potential managers. In addition, the Company continued to impart
training to its employees, with major focus on Leadership Development and Managerial
Effectiveness. A number of Internal and External training workshops, courses and seminars
were conducted and an elaborate induction-training programme for fresh graduate engineers, at
the entry level is arranged. The feedback from the training programmes has been very

Voltas HRD Center

Voltas HRD Centre, inaugurated on June 7, 1995, was designed by a group of architects,
engineers, behavioural scientists and HRD executives to provide the right environment for

M P Birla Institute Of Management 50

Training and Development. Set amidst idyllic sylvan surroundings, the Centre has an
auditorium and a conference hall, as well as a number of syndicate rooms of varying seating
capacities, backed by modern training aids and accessories.

Voltas' operations have been organized into four independent business-specific clusters, each
with its own facilities for market coverage and service to customers

7.1.2 Responsibilities of HR

• To carry out the activities related to HR

• To ensure that Competency and Skill Matrix are identified
• To ensure that Training needs are Identified, Planned and Conducted
• To ensure that Training effectiveness is measured
• To ensure that systems to motivate and empower employees are identified and implemented
• To control Quality records related to Quality System of their functions

7.1.3 Authorities of HR

• To initiate corrective actions when training planned are not achieved within the targets.
• To arrange training programs to all departments as per plan

7.1.4 The functions of HRD

• Recruitment.
• Training & development.
• Statutory wage & salary administration.
• Labor welfare, which includes canteen facilities, transportation, and housekeeping

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Voltas sourcing and marketing operations cover air conditioners, textile machinery, machine
tools, mining and construction equipment and industrial chemicals. In these sectors, the
company demonstrates its specialized engineering expertise, as well as its extensive network
for global sourcing.

The global sourcing agreement has brought significant cost benefits to Voltas. Voltas claims
that global sourcing has helped it become the lowest-cost manufacturer in India. In the past
five years, material costs for window ACs have dropped 20 per cent, from Rs 10,400 per unit
to under Rs 8,000 a unit, while the conversion cost has come down by a remarkable 60 per
cent, from Rs 2,000 a unit to Rs 650 a unit.


The company signed memoranda of understanding with the dealers, clear spelling out the
operational procedures and norms to be followed and the scope of work between the dealer and
Voltas. Voltas set aside 1 per cent of its turnover for training and development of its channel
partners. Money was pumped into dealer infrastructure, manpower training (with certification
programmes for all employees), sharing costs of mobile vans, cooperative ads and so on.
Changes were also made in the after-sales part of the business. The dealers are responsible for
customer care .Even the dealers have strict guidelines on interacting with customers and
responding to complaints. How many servicemen are required, what kind of servicing kit is
required, what spare parts must always be there, the dress code of a servicemen - everything is
spelt out for the dealer.

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Time targets - under four hours in the metros - have also been set for responding to customer
calls. And since the dealers and the head office are connected through a SAP system, all
transactions are online and transparent.

7.2.2 Brand building

Voltas has been in the process of brand building and thus shifted ad agencies - from O&M to
Euro RSG, which came up with a new positioning platform. The ads focused on defining
features of Voltas's new product range such as uniform cooling, energy-saving, timers and air
filters, with cues of performance and value-addition through technological innovation.

Subsequent promotions have focused on themes like customer service and low costs of
ownership. Celebrities like Shah Rukh Khan and Shoaib Akhtar were also roped in to
strengthen the brand.

Voltas invested more than Rs 50 crore (Rs 500 million) in branding initiatives; last year, it
spent Rs 17 crore (Rs 170 million) on marketing.

The figure for this year is somewhat higher: Rs 20 crore (Rs 200 million). But then, the theme
has changed too. Since the focus now is on capturing a larger share of the mass market,
Voltas's new campaign is aimed at the middle class, and has been shot in a distinctly non-urban

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7.3.1 Various Sections in Finance Department.

• Book and Budget
• Sales & bills payable
• Costing & establishments
• Internal audit & price store ledger

7.3.2 Book and Budget

• Collection of accounts from different sections
• Preparation of trial balance and final accounts
• Co-ordination with auditors
• Helping statutory auditor

7.3.4 Bills Payable

This section handles the payment to be made to the suppliers. This includes the receiving of
stores receipt vouchers, purchase order and their verification in terms of quality and quantity.
Once the claims are found satisfactory, the payment is made as per the terms.

7.3.5 Costing
Sets the cost that is used by commercial group to add profit margin to set the price.

7.3.6 Establishment
This section handles all the payment to the employees such as
• Salary & provident fund
• Incentives
• Loans and advances
• Medical reimbursement

M P Birla Institute Of Management 54

7.3.7 Internal audit:

After preparing the balance sheet, the internal auditors will audit & they send audited balance
sheets to the government auditors to audit the balance sheet.

7.3.9 Other functions of Finance Department are,

• Payment of wages and salaries
• Payment to suppliers
• Foreign purchase payments.
• Cash management.

M P Birla Institute Of Management 55

7.4 Water Management Department

Voltas caters to the vital sector of water management through pumping and water treatment
projects. In this domain, Voltas is established as a total solutions provider for turnkey pumping
projects as well as for water, effluent and sewage treatment, as well as water pollution control.
In all these applications, Voltas offers complete electro-mechanical and associated civil
construction services.

The key strength of Voltas is the accumulated knowledge and expertise to design, engineer,
supply, erect, test and commission complex pumping and water/sewage/effluent treatment
systems for a diverse range of projects.

The entire range of water/waste pollution control equipment is offered by Voltas, and its
expertise in this area has been developed over the years. Voltas can handle large integrated
turnkey projects from concept to commissioning. It has ISO accreditation for Engineering
Design, Manufacturing and Contracting.

Voltas' capabilities have been proven in a range of projects, which include

• water supply and pumping for cities and towns

• major irrigation schemes
• thermal, nuclear and hydroelectric power stations
• water and sewage treatment projects for cities and towns
• industrial water and effluent treatment projects for steel, fertilizer, chemicals, cement,
sugar refineries, paper and other industries.

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7.5 Mining & Construction Equipment Division (M&CE)

Voltas Mining & Construction Equipment Division (M&CE) has been serving the cause of
mechanization and modernization for almost 50 years, serving as a vital value-adding link
between manufacturers, suppliers and end-users.

Over the decades, it has established a large and appreciative customer base from both public
and private sectors. In conjunction with globally renowned manufacturers, M & CE offers its
customers a comprehensive package - proven expertise, long experience, the world's best
equipment and value-added service support.

Today, the Division offers the world's best technologies for infrastructure building, along with
a highly professional support engineering team.

As technology transforms the style and scale of the core sector surface mining industry, M&CE
plays a vital role in making the latest and most efficient surface mining equipment available to
Indian end users, especially for mining of coal, iron, copper, zinc and lignite.

With growing investment in infrastructure development, M&CE is increasingly focusing on

construction equipment, especially catering to the needs of road building. Hydro projects and
quarrying are also prime end-user industries.

The scope, scale and impact of several recent milestones testify to M&CE's vital role in
mechanizing and modernizing mining and construction in India.

M P Birla Institute Of Management 57

7.6 Machine Tools Department

Voltas Machine Tools is one of India's leading marketing & servicing organizations, focused
on providing engineering solutions to Indian industry. In this domain, Voltas has gained
experience over several decades by fulfilling machine tools needs across a wide spectrum of
manufacturing applications. In this activity, Voltas demonstrates a strong focus towards its
customer segments, be it automotive, heavy engineering, defense, public sector enterprises, or
small & medium enterprises.

7.7 Materials Handling Department

Voltas Materials Handling has been catering to the needs of the materials handling market for
over 44 years. Making a modest beginning in 1964 as a licensee of Yale - USA, for
manufacturing and marketing of diesel-driven forklift trucks (up to 3 tons) and battery-
operated trucks (up to 2.5 tons), Voltas has come a long way in establishing itself as a market
leader. Today it offers in-house designed forklift trucks ranging up to 20 tons in the diesel
version, and up to 3 tons in both battery and gas (LPG & CNG) versions. Voltas is capable of
designing and manufacturing higher capacity diesel forklift trucks against specific enquiries.

Voltas has had technical tie-ups with some of the most reputed names in the field, such as Boss
Trucks - UK and Terex Inc - USA. The knowledge and engineering expertise gained over the
years is used today to meet the unique needs of our customers. Customized design and quality
manufacture is facilitated with modern design tools such as CAD/CAM and CAE, and
production tools involving use of precision CNC machines.

M P Birla Institute Of Management 58

SWOT Analysis

M P Birla Institute Of Management 59


8.1 Strengths

• Voltas is a representation of global technology leadership

• Undisputed domain knowledge
• Provider of solutions in cooling appliances.
• Committed life-long product support
• Trusted sales and service network
• The design and manufacture of industrial equipment
• Serving diverse industrial sectors and applications.
• The company has a strong nation-wide infrastructure with committed excusive dealers

8.2 Weakness

• Highly dependent on its parent company for R&D and technology support.
• After sales services is one of the most crucial aspects.
• The company is not well equipped with eco friendly technology for all products.
• Does not do any effective advertisement nor has not looked much into advertisement

8.3 Opportunities

• Growing Indian middle class characterized with low penetration level of consumer
• Advent of Internet provides an excellent opportunity to reach to a large base of
consumers and cut costs.

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• There is a changing dynamics of consumer behavior where in luxury goods are
being perceived as necessities with higher disposable incomes being spent on
lifestyle products.
• CII has urged the government to reduce special excise duty (SED) on air
conditioners form 16%-8% in the next budget
• Government spending in infrastructure facilities is expected to increase and large
investments are being made in the power sector as well as in modernization of
existing airports. Two initial orders have been recently booked in the current year
(2009-10) for execution of MEP projects for the Kolkata and Chennai airports.
• Compliance with legislation such as Energy Conservation Building Code/National
Building Code will shortly become mandatory. The Company has proactively
invested in the development of energy efficient and environment friendly products
which will provide an opportunity for wider participation in the market
• The Central Government has taken measures such as reduction in excise duty to
revive the economic growth. This reduction in taxes and interest rates could provide
further stimulus to air conditioners and refrigeration products.


• Increased threats from cheaper imports, FROM NEIGHBOURING COUNTRIES

• Inflation effect
• The Company has increased its focus on industrial and infrastructure projects the entire
spectrum from pre-sale to project handover is critically evaluated for probable and
potential risks.
• The domestic market is dominated by the presence of key international players, many
of whom are setting up manufacturing facilities for greater cost-effectiveness.

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• The Company has to deal with currency fluctuations, since it earns in the Middle East
in currencies linked to USD, while some of material inputs are often sourced from
Europe, Japan and China.
• Commodity prices in the recent past have been subject to wide price fluctuations,
affecting metals such as steel, copper and aluminum, as well as PVC, which are the
major raw materials/components of this segment.
• Likely to face fierce competition from domestic companies as well MNC brands

M P Birla Institute Of Management 62

Suggestions &

Suggestions & Recommendations

M P Birla Institute Of Management 63

• Sales & Distribution - Voltas must aim for the sales & distribution team to be more
flexible in responding to market dynamics and more accountable by requiring it to
document all sales commitments
• Accounts Receivable - The company needed to improve accounting processes to reduce
working capital requirements
• Customer Service - The idea of Customer service to keep comprehensive, centralized
records of all contact to enhance customer service and strengthen customer loyalty.
• Improve after Sales Service –Improvement in after sales service can help in increasing
• Improve the marketing strategies i.e. advertising, promotion etc. This will surely help
Voltas AC to penetrate the tough Indian market and to keep the market share intact.
• Attractive schemes must be launched by company in order to attract lower middle class.
• Increase the number of Engineers in after sales Service department.
• More promotional campaigns must be started.
• Customer service cell should be increased.

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Voltas, a Tata enterprise, is India’s premier air conditioning and refrigeration company. The
company’s primary asset has been its experience and knowledge, built up over 50 years, in
designing, manufacturing, installing and servicing of air conditioning and refrigeration
systems. Voltas products are synonymous with quality and reliability.
Apart from being the pioneer in air conditioning in India, the company is also a leader in
commercial refrigeration and preservation, offering a range of coolers and freezers. These
products are manufactured and marketed by Voltas Hyderabad unit and sold under the Coldcel
brand name.
Currently, the Coldcel brand is the market leader in the commercial refrigeration segment, with
an overall market share of 40 per cent, 34 per cent in the cooler segment and 95 per cent in the
chocolate cooler segment.
The Coldcel commercial refrigerator range includes deep freezers, visi coolers and chest
coolers. These products offer a host of advantages, the most important being multi-door
options, lower power consumption, dependable after-sales service for the life of the product
and the Tata assurance of quality and trust. These plusses are the result of the company’s
commitment to continuously provide cost effective solutions in refrigeration.

M P Birla Institute Of Management 65


A wide range of products are available to meet various refrigeration requirements. The product
range comprises Chest Freezers, Chest Coolers, Visicoolers, Chocolate Coolers, Wine Coolers
and other refrigeration products. These products are manufactured at Voltas newly set up
modern manufacturing facility at Pantnagar in Uttarakhand for commercial refrigeration

Chest Coolers - 100L, 200L, 300L, 400L

Visi Coolers - 70L, 120L, 220L, 320L.
Chest Freezers - Hard top - 70L, 100L, 200L, 300L, 400L, 500L
Glass Top - 200L, 300L, 400L
Upright deep Freezers of 520L capacity


Following are the features of deep freezers.

• Soft Look Designs for Better Appearance

• Precoated Inner Liners for Improved Hygiene
• Castor Wheels for Easy Transportation
• UV Grade Plastic Materials for Long Lasting Appear
• CFC-Free Insulation for Environment Protection
• Powder Painted Body for Glossy Finish
• Spring Loaded Hinges for Effortless Usage
• Fast Freeze Switch for Faster Cooling When in Need
• Signal Indicator for Storage and Protection

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• Door Lock for Restricted Accessibility
• Sunken Handle for Safer Operation
• PUF Insulation

Deep freezers are available as metal top freezers and glass top freezers



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Following are the features of horizontal chest coolers

• Customized Branding of Machines

• Elegant Door Trims
• Castor Wheel for Free and Easy Movement
• Spring-loaded Hinges in Doors
• Multiple Door with Sunken Handles
• Tropicalized and Energy-efficient R 134a Compressor
• Inner Lining of Aluminum Textured Sheet Ensuring
• Corrosion Resistant with Outer Body in Powder-coat
• High Density, High Pressure 60mm Insulation Ensuring
• Contemporary and Sturdy Design

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Following are the features of visi coolers

• Castor Wheels for Easy Transportation

• UV Grade Plastic Materials for Long Lasting Appear
• CFC-Free Insulation for Environment Protection
• Powder Painted Body for Glossy Finish
• Door Lock for Restricted Accessibility
• PUF Insulation
• Low Emissivity Glass for Optimum Cooling Loss
• Sleek Designs for Better Appearance
• Certified Performance by International Laboratories
• Tropicalized Compressors

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Our world famous compressors run more smoothly than piston compressors, thus reducing
the vibration noise.


The indoor unit uses indoor fan with a wide diameter, different distances and slanting
blades, which prevents the formation of whirling air. This results in reducing noise levels.


The PG no grade speed control motor is not affected by voltage fluctuations and this avoids
the noise caused by the motor.

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The new golden optimised wind flow design lets the air flow smoothly and lowers the noise
down to minimum.


Each pipe is bent using an imported automatic three dimensional bending machine at one
goes. This reduces the welding knots; noise caused by box resonance and also avoids


Once this function is chosen, the room temperature automatically adjusts to suit the human
body temperature. You only need to press the sleep key and the air conditioner deactivates
automatically by checking the fan speed and the temperature setting, avoiding excessive


Use of world-famous compressors ensures high cooling efficiency and long life.

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The fluorescent technology adopted in the remote control makes it convenient to use in dark.
Also, nano technology used in the plastic crust produces antibacterial mote which can
efficiently eliminate bacteria on the remote control and avoid germ infection.


Fitted in the indoor unit, this water contamination free foil enhances the heat exchange


It efficiently prevents bacteria from breeding and spreading to create a healthy and comfortable


Voltas, a Tata enterprise has always aimed at acquiring customer satisfaction and has hence
designed products to suit the special requirements.
Voltas are under a conscious effort to grow the commercial refrigeration products segment.
Voltas Limited has lined up a fresh strategy to develop the market for its commercial
refrigeration systems.

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• Coldcel mainly targeted the institutional buyer, ice-cream manufacturers and retail
outlets. The Company customizes the products to suit special requirements.

• The brand name is supported with an extensive multimedia advertising campaign. The
company had appointed Mudra Advertising to handle the advertising account for

• Voltas Limited had appointed dedicated sales personnel across 23 company-owned

branches in leading metros and mini metros.

• Company started stocking a limited range of its commercial refrigerators across a

network of dealers across the country. The dealers will be used primarily for potential
consumers to book orders and contact the company in case the products have to be
customized to suit specific needs.

• Voltas Coldcel refrigerators is available through its 850 authorized service dealers
covering over 8,000 towns and villages, making Voltas service network the widest and
most efficient in the industry.

• The company offers Annual Maintenance Contract.

• The products launched have the contemporary soft look design - a first in India,
exclusive multi-door options, lower power consumption, dependable after-sales service
for the life of the product and the Tata assurance of quality and trust.

• The company is in the process of developing new kinds of products to cater to rural and
semi-urban areas, where the power supply is erratic.

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• Entire logistics operations is outsourced to Drive India Enterprise Solutions Limited
(DIESL), an integrated logistics company promoted by Tata Industries as there were
inefficiencies in logistics operations, leading to high cost build-ups, higher dead-on-
arrivals and other irregularities.

• A lean organization structure, with front-line personnel having defined authority levels,
helps employees to remain agile and responsive to customer needs. The lean work-force
combined with a Variable Pay model, has helped keep the work-force motivated and
achieves much higher performance.


Voltas coldcel products are used by ice-cream and frozen food manufacturers, beverage
manufacturers, malls and hypermarkets, and at all retail points selling frozen or perishable food
and beverages. The applications of various products are

Visi Coolers
Ideal for storing Soft Drinks, Fruit Juices, Milk Sachets, Tetra Pak Products, Flavored Milk,
Yogurt, Chocolates, Sweet Curd, Cheese, Butter, Beer, Mineral Water.

Deep Freezers
Ideal for storing Ice Creams, Frozen Meat, Fish, Poultry and Frozen Vegetables.

Chest coolers
Ideal for storing Soft Drinks, Fruit Juices, Milk Sachets, Tetra Pak Products, Flavored Milk,
Yogurt, Chocolates, Sweet Curd, Cheese, Butter, Beer, Mineral Water.

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Voltas Coldcel has helped clients across a spectrum of industries to meet their refrigeration

Some of satisfied customers are

• Pepsi
• Cadbury
• Nestle
• GCMFF (Amul)
• Hindustan Lever
• Mother Dairy Fruits and Vegetables Ltd
• Orissa Milk Marketing Federation
• Parag Dairy
• Patna Dairy
• Bangalore Dairy
• Parle International Limited
• Creamline Dairy
• Tulika Ice Cream
• Hatchson Agro Products
• Arokya Milk Products

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Voltas has a strong in-house R&D capability with a well-developed R&D laboratory.R&D
team comprises of highly experienced and efficient engineers dedicated to commercial
development of products. Quality Assurances Systems at various stages of product
development ensures top class quality of their products.

Testing facilities include...

• Computerized data logger for accurate recording of test results.

• Environmental test chambers for testing the machines in assimilated test conditions at
various ambient temperatures and humidity levels.

• Well equipped electrical test lab to test components and accessories like fan motor etc.,
Design is carried out by the CAD CAM systems.


Voltas Coldcel's products are highly advanced and have many advanced inbuilt features to
ensure smooth functioning of the product even under unfavorable conditions.

Manufacturing Facilities Voltas Small-scale Manufacturers

PU Foaming Automated PU Foaming Most of them don’t give PUF

equipment Insulation (Glass Wool used
instead). Those who give
PUF, use Manual Pouring

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PU Insulation PUF insulation thickness Density of insulation is very
Chest Type and Upright low due to manual pouring
Coolers – 60 mm method
Visi Coolers – 45mm

Painting Pre-treatment: Degreasing, Use crude methods owing to

Anti-Corrosion Treatment lack of sophisticated
and Phosphate enhances equipment
adhesive properties of
paint Spray painting: Finish not as
good and prone to scratches
Powder Coating: Gives and rusting
products glossiness,
scratch resistance and
durability for a long time

Gas Charging Fully Automatic Charging No automation. Charging

machines with done with obsolete
computerized display of equipment
exact quantity being

Dehydration Internal Components are Sufficient care not taken

thoroughly cleaned and owing to lack of equipment,
dehydrated before hence cannot ensure
assembling complete dehydration

Brazing of Joints Soldering material used Soldering material has low

for brazing joints has high silver content, hence joints
silver content, hence joints are prone to cracks and leaks

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are leak proof

Evacuation High Capacity Vacuum Vacuum pump capacities are

pumps used for evacuation much lower, hence complete
of air and foreign particles evacuation very rarely
from evaporator / happens

10. Key Success Factors

• Components availability & prices

• Regional - distribution strengths
• National - large institutional strengths
• Ability to customize refrigeration configurations quickly
• Select products - application engineering strengths

11. Market Characteristics

• Commercial refrigeration products have a derived demand -that is, the demand is
dependent on the user industries performance
• Usage mostly in processed foods and beverage segments
• Refrigeration components are mostly standardized; Customization occurs mainly in
configuration of cold rooms / cold storage system, where the area to be cooled will
determine the design of the equipment
• Components often sold on ‘Cash and Carry’ basis
• Excise duty: 16 %; Import Duty - Basic: nil, surcharge: 2.5 %, countervailing: 16 %
and special additional duty: 4 %.
• Channels: Voltas sell components through dealers

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12. Demand Drivers

• Growth in the retailing sector

• Investments in cold store / refrigeration chains across the country
• Increase in the demand for fresh fruits and vegetables (processed as well as
unprocessed), milk and milk products, fish and meat products
• Exports thrust, especially in processed fruits& vegetables, fish and meat products

13. Market Share

As per the information gathered from various sources Voltas coldcel are the market leaders
with market share of over 38% in the commercial refrigeration segment giving a cut throat
competition to its local as well as international players.

25% 39% voltas

blue star


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14. Business Concerns

• Lack of adequate storage infrastructure - few cold storages, refrigerated trucks

• High level of wastage of food products
• Low level of conversion of food products into processed foods
• Seasonality of demand for equipment such as freezers, ice making machine, bottle
• Changes in excise and customs duties on refrigeration components affect their demand.

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15. Suggestions and recommendations

Voltas is that kind of brand which has highly deep routed in the Indian market and at the same
time people have developed a greater goodwill towards it.

The commercial refrigeration of Voltas which I had chosen for the topic of study has got all the
relevant factors to capture consumer market. The strategy found out by Voltas as well as its
quality is satisfactory which has led to the success of the product. One suggestion is that more
care and concern should be given to after sales service to retain the trust of existing customers.
That Voltas should bring advertisement in print media and audio to attract more consumers
towards brand and concentrate on semi urban areas and remote areas too. Voltas has more
visual identity, but it should work to create strong brand identity. Voltas should keep on
brining out new time attractive offers and schemes to increase brand value and attract
customers. Exhibitions do not help to generate so much sells but they should be conducted
regularly. This helps in generating awareness regarding the product in customers which
ultimately helps in sales. Company should try to improve service. No doubt the company
products have technically edge over competitors but in long run they have to build stronger
strategies in selling and distribution.

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16. Bibliography

Websites referred:

Hindu business line
Business outlook

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