Rashtriya Ispat Nigam Limited Visakhapatnam Steel Plant Visakhapatnam Andhra Pradesh, India Expression Of Interest (EOI)

Transcription

1 Rashtriya Ispat Nigam Limited Visakhapatnam Steel Plant Marketing Department-HQ Main Administrative Building Visakhapatnam Andhra Pradesh, India Expression Of Interest (EOI) for Appointment of consultant for assessment of market environment & formulation of comprehensive marketing policy appropriate to RINL/VSP 1

2 1.0 Intent RINL, a leading Central Public Sector Enterprise, under the administrative control of Ministry of Steel, GOI, manufactures Iron and Steel produces in long product category, intends to appoint a consultant for assessing market environment and formulation of comprehensive marketing policy, appropriate to RINL/VSP, taking into account RINL s growth potential and also requirement of exports. 2.0 Objective The consultant to suggest various policy initiatives, covering the following activities/strategies, at the current level of 3.0 Mt stage, 6.3 Mt, 7.3 Mt and 11 Mt stages of expansion to carry out Marketing function effectively. Type of products to be manufactured in various stages of expansion Market segmentation Product mix in various stages of expansion and optimum product mix Increasing share of high end value added steels Development of market segments Optimisation of market-mix Product placement and distribution Exports as a strategy Product pricing Modes of sales Optimisation of NSRs Credit sales Brand building and product promotion activities Optimisation of transport-mix i.e. rail, road, container and coastal Marketing network Organisation structure and competence building Empowerment Future initiatives 3.0 Invitation for Bids RINL invites Expression Of Interest (EOI) for selection of a consultant for RINL/VSP. The copy of bid document may be obtained from Main Administrative Building, Marketing Department, Visakhapatnam Steel Plant, Visakhapatnam, P.I.N , Andhra Pradesh, India on all working days in person. Also the bid document may be downloaded from our website The details are given below: 2

3 VSP/MKTG-CONT/EOI/01OF DT EOI Bid Reference Cost of EOI documents NIL Date of issue of EOI : Earnest money deposit (EMD in DD/pay order) NIL Pre-bid meeting date at 11.00AM Office of GM(Mktg.)-I/c, Venue First Floor, Main Admn. Bldg., VSP, Visakhapatnam-31 Last date and time for receipts of EOI Bid at AM Opening of technical bids at 3.00 PM Opening of Price Bid Date will be advised subsequently address : ppmoharikar@vizagsteel.com Contact Telephone/Fax Numbers Tel : Fax : Contact Person GM-Marketing Tel : Mob : Submission of EOI : General Terms and Condition The response to EOI must be submitted in envelopes superscribing EOI for Appointment of Consultant for the task - To Assessing Market Environment and formulation of Comprehensive Marketing Policy of RINL on top of the envelope mentioning reference number and date given hereinabove. The bidders should take care of submitting the bids properly filed so that the papers are not loose. The bid documents should be properly numbered and submitted in a file in proper manner so that the papers do not bulge out and tear during scrutiny. Interested parties may seek the clarification if any, from the Company at any time. However, a Pre-bid meeting will be conducted on the scheduled date as above. 5.0 Date of submission: As per schedule above. Bidders are requested to participate in the bid process strictly according to the time schedule. The Bids should be addressed to: General Manager (Marketing)-I/c Main Administrative Building, Marketing Department, Visakhapatnam Steel Plant, Visakhapatnam, Andhra Pradesh, India P.I.N , 3

4 RINL is not responsible for non-receipt of response to EOI within the specified date and time due to any reason including postal holidays or delays. In case the specified date of submission & opening of Bids is declared a holiday, the bids will be received till the specified time on next working day. 6.0 Process of selection of the consultant It is planned to adopt 2 stage tendering process. In the first stage, Expression of Interest (EOI) from the leading experienced and knowledgeable consultants in the field of marketing consultancy as brought out above is sought. In the second stage, based on the proposals received from various consultants against Expression of Interest (EOI), a Committee appointed by RINL/VSP would shortlist the Consultants for giving presentations to the Management of RINL/VSP. The inputs from the presentations made by various consultants would be examined and a final tender document with full scope of Terms & Conditions will be prepared / finalized for floating open tender. A Consultant would be appointed by RINL/VSP based on the evaluation criteria and price bid as indicated in the tender document. 7.0 Company Profile Rashtriya Ispat Nigam Limited (RINL) is a Navaratna Cental Public Sector Enterprise (CPSE), owned by the GOI. The company was established on 18 th February Visakhapatnam Steel Plant (VSP), the first shore based integrated Steel Plant located at Visakhapatnam in the State of Andhra Pradesh, India is a unit of RINL. The plant has a capacity to produce 3.0 million tonnes of liquid steel per annum. Currently, RINL/VSP is in long product segment with a market share of 10% in the long products in the country. The capital cost of the Plant is Rs 8593 Cr (Base : January 1994). VSP was the first integrated steel plant in the country to be set up with the latest stateof-the-art technology with many technological features introduced for the first time in the country. Some of these are 7m tall coke oven batteries, biggest blast furnaces of 3200 cum volume, 100% slag granulation at cast house, 100% continuous casting etc. The plant has stabilized its operations and surpassed rated capacities in the year In the year , RINL turned around by registering net profit. Since then there is no looking back. The company has been steadily improving its performance year after year and operating at about % of its capacity consistently. RINL/VSP has created benchmarks in many of the techno-economic parameters in the Indian steel industry. RINL/VSP has been registering net profit year after year. The company became debt free in and wiped out its accumulated net losses in

5 Consistent physical and fiscal performance of RINL/VSP has helped in achieving Miniratna status in May 2006 followed by Navratna status in October The company has won the prestigious Prime Minister s Trophy for the best Integrated Steel Plant in the country for two years i.e and RINL/VSP has also won the first Steel Ministers Trophy for the best Integrated Steel Plant in Present Production Capacity In the existing plant, RINL also produces basic grade pig iron. Production capacity and product-mix of RINL/VSP are brought out below : (Unit : million tonnes) Product Capacity Product-mix Hot metal Feeding to Steel melt shop and steel making grade pig iron Pig iron Steel making grade pig iron Liquid steel Mild steel and special steels Wire rod mill (WRM) Wire rods : mm Rebars : 8,10,12 mm Light and medium merchant mill (LMMM) Medium merchant & structural products Rounds : mm Rebars : mm Srtls : mm Rounds : mm Squares : 65x65, 75x75, 90x90 mm Strls : mm Billets Blooms : 320x320/250x250 mm Billets : 125x125 mm Total saleable steel In addition to pig iron and saleable steel as indicated above, RINL/VSP also produces various by-products like granulated BF slag, lime fines, nut coke, coke dust, coal chemicals i.e. ammonium sulphate, benzene, toluene, xylene, naphthalene, coal tar, pitch, wash oil, pitch creosote mixture (PCM) etc. The by-product gases like BF gas, LD gas and coke oven gas are consumed in the process of steel making. 5

6 7.2 Sale Performance for last 3 years Unit : Volume : 000 t, Value : Rs Crs. Item Pig Iron ( 000t) Saleable Steel ( 000t) Byproducts (Rs Crs. ) Sales Turnover (Rs Crs.) RINL/VSP has the capability to produce value added steels like low carbon, medium carbon, high carbon steels, spring steels, cold heading quality steels, electrode quality steels, etc. About 35% of the production at the current level are in high end value added steel grades. Most of the value added steels produced by RINL/VSP find application in automobile and engineering sectors. The profitability of RINL in the last three years is brought out below : Unit : Rs Crs. Item PBDIT Net profit before tax Net profit after tax Expansion Plan RINL has taken up expansion of its capacity from 3.0 MMT per annum to 6.3 MMT with an investment of in the order of Rs Cr.(Base : Dec 09). The expansion is likely to be commissioned progressively during the current year i.e In the on-going expansion RINL/VSP will continue to be in the long product segment. Three rolling Mills are being commissioned in the expansion. These are Wire Rod Mill, Special Bar Mill and Structural Mill. The capacities and the product-mix of these Mills are given below : Unit : million tonne Product Capacity Product-mix Hot Metal Feeding to Steel Melt Shop and steel making grade pig iron Liquid Steel Mild steel and special steels Wire Rod Mill-2 (WRM) Wire Rods : mm (also mm) Special Bar Mill (SBM) Rounds : mm (coils and straight lengths) Structural Mill (SM) Strls : mm Billets / Rounds Billets : 150x150 mm, 200x200 mm Rounds : 220, 280, 350 mm Total saleable steel

7 7.4 Long-term directional plan After the on-going expansion, RINL/VSP is going to be a single largest producer of long products in the country. Further, there are plans to expand the capacity upto 20 million tonnes as brought out below : Phase Year of commissioning Capacity (MMT) Product-mix Phase Longs Phase Longs Phase Flats Phase /16 To be decided Phase To be decided 7.5 Existing Marketing Network Currently, RINL/VSP has a network of 5 regional offices, 23 branch sales offices and 22 stockyards spread across the country. The details of existing network are given at Anexure-1. In addition to these outlets, RINL/VSP has appointed Consignment Sales Agents (CSAs) at strategic locations, where RINL does not have a branch sales office. Currently, RINL/VSP has appointed 8 CSAs. These are Vizag, Kadapa, Damtal, Jamshedpur, Guwahati, Agartala, Jabalpur and Bhopal. RINL/VSP has appointed about 150 Retailers. These Retailers purchase and sell RINl s products. District Level Dealers (DLDs) and Rural Dealers are also registered by RINL/VSP to take care of demand in semi-urban and rural areas. Currently, RINL/VSP has 78 DLDs and 177 Rural dealers. In due course, to take care of expansion requirements, the Distribution Network is proposed to be enhanced. 7.6 Present pattern of sales Sales categorization : Actual users, project customers, small scale industry corporations, retailers, district level dealers and rural dealers : Product-wise percentages are specified for each category. Projects/SSIs/ Retailers/DLDs/ E-auction Product Actual users RDs/Others WRC, LMMM 100% Nil Nil Billets & Blooms Rebars & Structurals 50% 40% 10% Rounds 55% 35% 10% MMSM Billets 70% 20% 10% 7

8 Mode of sales : MOUs with actual users, project customers, retailers, sales to small scale industry corporations i.e. NSIC/SSIs as per the allocation of GOI, e- auctions and spot sales. Pricing : The High Power Committee consisting of Functional Directors fixes the price bands of various products taking inputs from the Pricing Section. As per these price bands, the prices are fixed every month. 8.0 Scope for Consultants The company recognized that it needed to be proactive and initiate strategies in line with the changing market dynamics, shifting its focus from that of a traditional approach of public sector to adopting a modern, customer-centric business model. RINL/VSP intends to improve its working system by rapidly launching new services, improving efficiency and reducing and managing risks to be delivered by a flexible, scalable, and innovative business model. Since the scope and areas for improvement and the methodology for realising these are expected to be manifold, it is proposed to invite the consultants for making a presentation before the management of RINL/VSP on the understanding of the consultants and the methodology to be adopted by them for carrying out the study. The consultants would suggest, the products to be produced from expansion units based on their assessment of supply and demand analysis and market conditions. Some of the areas, which need to be covered by the consultant while formulating the proposed comprehensive marketing policy of RINL/VSP are given below (the list is indicative and not exhaustive) : Type of products to be manufactured i.e. longs or flats and the product-range in various stages of expansion. Market segmentation and development of new market segments so as to improve RINL/VSP s reach in the market place. Increasing share of high end value added steels in the product-mix. Product placement and distribution and improving customer base. Product pricing mechanism Modes of sales including credit sales Brand building and product promotion activities for establishing RINL s brand image. Building of new brands for Rebars produced through conversion RASHTRIYA ISPAT and Structurals produced through conversion RINCON. Optimisation of market mix by adopting mathematical model for improving realisation Conversion of Semis to increase the NSR and to make economy rebars for meeting the demands of rural areas. 8

9 Exports as a strategy - reserving a specific quantity for exports. This was basically to develop export markets for Semis that would be available for sale in large quantities after commissioning of expansion units. Development of market segments Strategy to sell high volume low value by-product like BF granulated slag, LD slag etc. Development of downstream industries for steady off take of product like coke fractions, coal chemicals, BF granulated slag, LD slag etc. Marketing network - Opening of new outlets in the form of new branches/csas. Rural marketing Organization Structure and strategies, empowerment and action plan for competence building. Empowerment Future initiatives The Consultants will not only suggest various strategic initiatives of marketing policy but also review the status of implementation of suggested marketing policy and action points every year for 3 years and give their suggestions based on the market conditions as and when a reference is made by RINL to them on any specific issues. 9.0 Time frame for the Study The timeframe for the study is as under : Item Receiving EOI from the Consultants Presentations Finalisation of scope of work and terms and conditions Seeking Tenders Finalization of Evaluation Issuing appointment letter Completion of study and submission of Report by the Consultant Time frame 4 weeks from the date of publication of the Advertisement for obtaining EOI 1 week 2 weeks 4 weeks 2 weeks 2 weeks 4 months 9

10 10.0 Eligibility Criteria The consulting organization is required to meet the following eligibility criteria and provide adequate documentary evidence for each of the criteria stipulated below : a) Should be a Government Organization/PSU/PSE/ partnership firm or a limited company i.e. a valid legal entity. b) Should be in existence for the last five years as on (in case of mergers/acquisitions/restructuring or name change, the date of establishment of earlier/original partnership firm/limited company would be taken into account). c) Should have earnings from consultancy of at least Rs. 50 Cr. p.a. on an average during the past three years i.e , and The statement of consultancy earnings needs to be certified by statutory auditors. d) The Agency should have experience in giving consultancy in Marketing / Research and formulation of Marketing Strategy and Policies to large manufacturing organisation having a turn over of Rs 1,000 Cr & above per annum. Work order/ completion certificates from the organisation need to be furnished along with the response. The engagements should be during the last 5 years. The proof of turn over of Rs 1000 Cr & above also to be produced for the organization whose work was taken up for market study. e) The Agency, which is currently under black list shall not be eligible. f) It should be a reputed consulting agency having its office in at least 3 major steel producing countries abroad. Those who fulfill all the eligibility criteria as mentioned above are only eligible to take part in the EOI. Proposals of those consultant, who do not fulfill the eligibility criteria conditions as stated above will not be considered Right of RINL/VSP RINL/VSP reserves the right for any changes in the bidding process, evaluation methodology etc. ***** 10

11 RASHTRIYA ISPAT NIGAM LIMITED VISAKHAPATNAM STEEL PLANT (A Govt of India Enterprise) Marketing Department, C Block, 1st Floor Main Administration Building Visakhapatnam Phone: / Fax: / Visit us at EXPRESSION OF INTEREST Sub: Expression of Interest (EOI) for appointment of Consultant for assessment of market environment & formulation of comprehensive marketing policy appropriate to RINL/VSP. Ref: Expression of Interest vide notice no:vsp/mktg-cont/eoi/01 OF DT 14/10/2011 Sealed tenders in the prescribed form are invited from experienced / established consultants for appointment of Consultant to assess the market environment & formulation of comprehensive marketing policy appropriate to RINL/VSP on All India Basis. For further details and for downloading tender documents, please log on to our web site Last date of submission of EOI : AM on Venue: In the office of DGM/Mktg-Contracts I/c VSP at the above address. Name of contact person: Shri A.K.Balla, AGM/Mktg-Contracts Phone number: V.Yugesh Dy.General Manager (Mktg) 11

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