INTRODUCTION:

Lucas Indian Service Ltd commenced its operations way back in 1930 with

its base in Bombay as a sterling company under Joseph Lucas, Birmingham,

U.K. The company steadily grew, meeting the entire needs of diverse

imported automobiles for auto electrical, diesel injection pumps, brakes etc.

In order to cope up with the growing demand from Eastern India, it opened a

branch in Calcutta in 1936. Simultaneously, it also created a country wide

dealer network in those early days to provide services.

HISTORY OF THE COMPANY

The onset of the Second World War led to the total stoppage of

supplies from U.K. And LIS rose to the challenge to keep the war efforts going by

the ingenious and improvised methods of reconditioning worn out equipment for

defence. In fact, LIS, Calcutta became a major base for reconditioning. By the time

the war ended in 1943, LIS acquired sufficient expertise in sales and service which

led to the opening of its 3rd branch in Madras in 1946.

LIS, Madras also set a plant in the early 60's to manufacture ignition coils for 2

wheelers/ 4 wheelers to cater to O E manufactures / replace markets. It has been

highly successful not only in meeting the demands of domestic market but also in

exporting to other countries.

The post-independence period saw a proliferation of automobile

manufactures for country's self-reliance and economic growth which in turn led to

the development and manufacture of components for auto industry.

Joseph Lucas joined hands with TVS – another pioneering institution in

India in 1962 to manufacture Auto Electricals for a wide range of applications for

2 wheelers, cars, trucks, tractors, buses, marine / stationary engines. The product

range is very comprehensive consisting of starters, alternators, dynamos,

regulators, distributors, wiper motors, lamps, horns . Due to new legislation

brought out the Govt. on import restrictions, LIS had to curtail the imports from

U.K. and heavily depend on Lucas-TVS for its support to market /service their

indigenous products and thus LIS became a fully owned subsidiary of Lucas-TVS

Ltd. on 1.8.1968.

LIS started expanding its network of branches starting from Delhi in 1972 to

meet the country's huge demands and presently it has 25 branches in all

metropolitan cities and major state capitals or major commercial centres of states.

Apart from branch outlets for distribution and service, LIS has a dedicated dealer

network of over 500 centres which in turn cater to about 20,000 retail outlets all

over India to meet the end user needs. Besides the Lucas-TVS range of products,

LIS has also been distributing and marketing 'LUCAS' batteries as a basic product

for auto electrical system right from the inception.

LIS took up diversification in marketing a host of quality products under the brand

name 'LISPART' during 1975. The product range covers fan belts, auto cables,

bulbs, switches, relays for head lamps and horn and dash board instruments which

are basic akin auto electrical in any automobile.

Apart from marketing of Lucas-TVS auto electrical and 'LISPART' spares, LIS has

been also a role to play in servicing this equipment and it has been successful in

developing and marketing highly accurate and precise test equipment / special

tools. With the commencement of the production of Rotary Type of diesel fuel

injection pumps for cars and LCV's by Lucas-TVS Ltd., LIS is also active in

providing country wide sales and service through its branch operations and

upgrading the service points.

As part of its service to India's automotive industry, LIS conducts training courses

for personnel from O E manufactures, Defence Establishments, Nationalised

Transport Undertakings, Fleet Operators, and Auto Electricians. LIS has

employee strength of over 350 spread all over India, and has never lost a man day

as industrial relationships has been always cordial.

With a turnover of over Rs.325 crores, LIS has come to be acknowledged as a

unique automobile institution of this country and the day is not far in it becoming a

Rs.400 crore company.

COMPANY PROFILE:

22nd March 1877 marked the dawn of industrialisation of Southern

India with the birth of the doyen Shri T V Sundaram Iyengar. The TVS Group was

formed in 1911 by T V Sundaram Iyengar, one of the pioneers of Indian industry.

He was a visionary, whose ideas were years ahead of their times, and a man of

principles. Both these things combined to make him a legend in his own life time

all over Southern India. Three years before World War I, when the automobile was

still seen as some kind of intimidating “horseless carriage”, he had the vision to set

up South India's first ever rural bus service. And, over the years, this transport

company became the largest of its kind in the country – legendary for its

punctuality and service. In fact, the rules and regulations our Founder laid down

for himself later became the blueprint for the Motor Vehicles Act.

During the war years, TVS set up a service station for reconditioning vehicles and

a tyre re-treading unit. The shortage of petrol was overcome through the

manufacture of conversion kits which allowed the use of charcoal gas in

automobiles as a substitute for petrol.

T V Sundaram Iyengar's philosophy of business reflected the kind of man he was:

simple, but stern. It was based rigidly on four concepts-quality, service, reliability

and a sense of ethics. It is this personal philosophy that has formed the cornerstone

of our corporate culture as, over the past 90 years, we have evolved into one of

India's leading industrial houses.

TVS believes that the success of any enterprise is built on the solid foundation of

customer satisfaction. Continuous innovation and close customer interaction have

enabled TVS companies to stay ahead of competition. The group endeavours to be

competitive without compromising on Quality. And quality at TVS determines not

only the end product but the systems, processes and operations at all levels.

The rise of India's automotive industry after Independence saw TVS enter

components manufacture, the Group's next major milestone. For two decades,

beginning in 1960, the TVS Group formed alliances with many world leaders for

manufacture of critical automotive components, and later, of two-wheelers.

These years of steady growth, expansion and diversification, repeatedly proved the

Group's unique ability to sense a sunrise industry in the Indian environment and to

build it up to maturity. This was not restricted to the automotive industry alone.

Today the TVS Group has a leading presence in computer peripherals and

consumer durables.

TVS Group is surging ahead towards attaining further heights in the industrial

hemisphere of India, with the devotion and dedication of the multi-skilled work

force behind.

INDUSTRIAL PROFILE

TVS Group is one of India's oldest business groups. It is a giant conglomerate

with presence in diverse fields like automotive component manufacturing, automotive

dealerships and electronics. Today, there are over thirty companies in the TVS Group,

employing more than 40,000 people worldwide and with a turnover in excess of USD

2.2 billion.

TVS Group originated as a transport company in 1911. TV Sundaram Iyengar

and Sons Limited is the parent and holding company of the TVS Group. TV

Sundram Iyengar and Sons Limited has the following three divisions:

TVS and Sons: TVS and Sons is the largest automobile distribution company in

India. It distributes Heavy Duty Commercial Vehicles, Jeeps and Cars. TVS and

Sons represents premier automotive companies like Ashok Leyland, Mahindra

and Mahindra Ltd., and Honda. The company is also one of the leading logistics

solution providers and has set up state-of-the-art warehouses all over the country.

TVS and Sons has also diversified into distributing a range of Garage equipments.

Sundaram Motors: Sundaram Motors distributes Heavy Duty Commercial

Vehicles, Cars, and auto spare parts for several leading manufacturers. The

company is also the dealer for Ashok Leyland, Honda, Fiat, Ford and Mercedes

Benz.

Madras Auto Service: Madras Auto Service distributes automotive spare parts

for all leading manufacturers.

Other major companies of TVS Group are:

TVS - Motor Company Limited: TVS Motor Company Limited is one of the

largest two-wheeler manufacturers in India. It manufactures Motorcycles, Mopeds,

Scooters.

TVS Electronics Limited: TVS Electronics was incorporated in 1986 in collaboration

with Citizen Watch Co. of Japan. The company manufactures a complete range of

computer peripherals.

Axles India Limited: Axles India was promoted by Sundaram Finance, Wheels India

and Eaton Corporation for the manufacture of axles for medium and heavy duty

commercial vehicles in India.

Brakes India Limited: Brakes India is a joint venture between TV Sundram Iyengar and

Sons Ltd. and Lucas Industries Plc., UK. The company manufactures braking equipment

for automotive and non-automotive applications.

Sundaram Polymers Division: Sundaram Polymers Division manufactures Engineering

Plastic compounds for various applications.

Harita Finance Limited: Harita Finance Ltd is a finance company under the TVS

Group. It deals in retail finance, hire purchase, leasing and bill discounting.

Harita Finance Limited: Harita Finance Ltd is a finance company under the TVS

Group. It deals in retail finance, hire purchase, leasing and bill discounting.

India Motor Parts and Accessories Limited: It is engaged in the distribution of

automobile spare parts.

India Nippon Electricals Limited: It is a joint venture between Lucas Indian Service

and Kokusan Denki Co Ltd., Japan. The company manufactures Electronic Ignition

Systems for two wheelers and portable gensets.

IRIZAR TVS (P) Ltd: IRIZAR TVS (P) Ltd. is a joint venture between Sundaram

Industries Ltd, Ashok Leyland Ltd and IRIZAR S. Coop of Spain. The company builds

bus bodies for export and domestic market.

Lakshmi Auto Components Limited: The company is a subsidiary of TVS-Suzuki. It

manufactures gears, crankshafts and connecting rods for TVS-Suzuki motorbikes and

mopeds.

Lucas Indian Service: Lucas Indian Service is a wholly owned subsidiary of Lucas-TVS

Ltd., engaged in the sales and service of auto-electricals and fuel injection equipment.

Lucas - TVS Limited: Lucas-TVS, a joint venture between Lucas Varity group, UK and

TVS Group, is a leading manufacturer of auto electrical products and diesel fuel injection

equipment in India.

Sundaram Brake Linings Limited: Sundaram Brake Linings is the leading

manufacturer of brake linings in India

Sundaram-Clayton Limited: Sundaram - Clayton Ltd manufactures complete range of

air brake actuation system - compressors, actuators, valves, brake chambers, spring

brakes, slack adjusters, couplings, hoses, switches and vacuum boosters for light/medium

and heavy commercial vehicles and trailers. Foundry Division manufactures aluminum,

gravity and pressure die-castings.

LUCAS INDIAN SERVICE VISION

Lucas Indian Service will become India's dominant and most respected service

provider (Parts and after service) in its areas of specialization by 2015-2016

LUCAS INDIAN SERVICE will expand overseas with focus on SAARC,

ASEAN and Middle East

LUCAS INDIAN SERVICE MISSION

The mission of LUCAS INDIAN SERVICE is to provide proactive and high

quality after sales and service to vehicle makers and users in its areas of

specialization (electrical and diesel systems).

LUCAS INDIAN SERVICE will continuously expand the scope of its sales and

service offering for vehicle and non-vehicular applications in anticipation of

customer needs.

LUCAS INDIAN SERVICE will continuously enhance the technical skill of its

people and expand its network through use of contemporary technology.

OBJECTIVES OF THE COMPANY:

:

Maintain leadership in the domestic market and presence in export markets.

Ensure customer satisfaction through timely delivery of quality products and

services, at competitive prices.

Continuously improve & innovative product design, process technology and

work environment to offer better products.

Bring about involvement of all employees in achieving the above objectives.

THE INDIAN COMPANIES ACT (ACT VII OF 1913)

COMPANY LIMITED BY SHARES

MEMORANDUM OF ASSOCIATION

OF

LUCAS INDIAN SERVICE LIMITED

1. NAME CLAUSE:

The name of the company is LUCAS INDIAN SERVICE

LIMITED.

2. REGISTRATION CLAUSE:

The registered office of the company will be situated in state of

Tamil Nadu.

3. OBJECT CLAUSE:

The objects for which the company is established are:

To carry on the business of manufacturers, importers and dealers in all their

branches of and in every form of mechanically-propelled vehicle or vessels

and of all parts thereof and accessories thereto whatever the motive power of

such vehicle may be.

To carry on the business of proprietors of garages ,service stations and

mechanical engineers .

To buy ,sell, manufacture, repair ,alter, improve, exchange, let out on hire,

import, export and deal in all

works ,plant,machinery,tools,utensils,appliances,apparatus,products,material

s,petl and things capable of being used in any every such business as afore

side or required by any customers of or persons having dealings with the

company or commonly dealt in by persons engaged in such business or

which may seem or capable of being profitably dealt in connection any of

the said business.

To expend money in experimenting on and testing and improving or seeking

to improve any patents , rights inventions, discoveries or information of the

company or which the company may acquire or propose acquire.

Generally to carry on any other trade or business whether manufacturing or

otherwise subsidiary or auxiliary to ,or which can be conveniently carried on

in connection with any of the companies objects; and to establish and to

maintain agencies in any part of the world for the conduct of the business of

the company or for the sale of any materials or things for the time being at

the disposal of the company for the sale ;and to advertise and adopt any

means of making known all of any of the manufacture products or goods of

the company or any articles or goods traded or dealt in by the company in

any way that may be thought advisable including the posting of bills in

relation there to and the issue of circulars ,books ,pamplets and price lists

and the conducting of competitions and the giving of prizes and donations .

To acquire by purchase amalgamation grant concession lease license barter

or otherwise either absolutely or conditionally and either solely or jointly

with others any real or personal immovable or movable property rights or

privileges including any land, building, rights of way , easements , licenses,

utensils, stock in trade.

To build , construct, maintain ,alter enlarge pull down and remove or

replace any buildings factories offices works machinery engines walls or

fences and to clear sites for the same and to work or control the same.

To transact and carry on all kinds of agency business .

The other objects for which the Company is established are:

To enter into partnership or into any arrangement for sharing profits with

any person , firm or company engaged in or about to engage in any business

which may seen capable of being carried on directly or indirectly the benefit

of the company.

To amalgamate with any company or companies having objects altogether or

in part similar to those of the company .

To promote ,form, be interested in and take hold and dispose of share in

other companies having all or any of the objects of the company and take up

debentures or otherwise subsidise or assist such companies .

To procure the incorporation, registeration or other recognition of the

company in country ,state or place or any of the company’s agencies.

To draw ,accept and make and to endorse ,discount and negotiate promissory

notes ,hundies, bills of exchange and other negotiable instruments connected

with the business of the company.

To sell or in any other manner deal with or dispose of the undertaking or

property of the company, or any part thereof for such consideration of the

company may think fit.

To create depreciation, reserve or sinking or insurance funds or any other

special fund for the benefit of the company.

To provide for the welfare of the employees of the company by creating and

contributing to any provident fund or otherwise the company shall see fit.

To distribute any of the property of the company amongst the members in

specie or kind.

To pay all legal and other expenses connected with the formation of the

company.

To do all such other things as are incidental or conductive to the attainment

of the above objects or any of them.

4. LIABILITY CLAUSE:

The liability of the members is limited.

5. CAPITAL CLAUSE:

The share capital of the company will be rupees ten crores, divided into

one crore equity shares of rupees ten each with power to increase and with

power from time to time to issue any shares of the original or new capital with any

preference or priority in the payment of dividends or the distribution of assets or

otherwise with any other shares whether ordinary or preference and whether issued

or not to vary the regulations of the company as far as necessary to give effect to

any such preference or priority and upon the sub-division of a share to apportion

the right to participate in profits or surplus assets with special rights priorities and

privileges to any of the undivided shares of the right to vote in any manner as

between the shares resulting from such division.

6. ASSOCIATION CLAUSE:

We, the several persons, whose names and addresses are subscribed,

are desirous of being formed into a company in pursuance of this Memorandum of

Association, and we respectively agree to take the number of shares in the capital

of the Company set opposite our respective names.

THE INDIAN COMPANIES ACT (ACT VII OF 1913)

COMPANY LIMITED BY SHARES

ARTICLES OF ASSOCIATION

OF

LUCAS INDIAN SERVICE LIMITED

The regulations contained in table ‘A’ in the first schedule to the

companies act1956 shall apply to this company subject as hereinafter provided.

The following regulations of table ‘A’ shall not apply for the management of the

company, that is to say, 9, 21 to 24, 40 to 43, 65, 66, 74, 79(2) and 99. The

remaining regulations of table ‘A’ and these articles shall constitute the articles of

association of the company.

1. SHARE CAPITAL :

The share capital of the company shall be Rs.10, 00, 00,000 (Rupees

ten crores) divided into 1, 00, 00,000 (one crore) equity shares of Rs 10 each.

2. COMPANY’S LIEN ON SHARES:

The company shall have a first and paramount lien upon all the shares

registered in the name of each member (whether solely or jointly with others) upon

the proceeds of sale thereof, for his debts, liabilities and engagements. Solely , or

jointly , with any other person , to or with the company , whether the period for

the payment ,fulfillment , or discharge thereof shall have actually arrived or not

. and no equitable interest in any share shall be created except upon the footing and

condition that regulation of table ‘A’is to have full effect any such lien shall extend

to all dividends from time to time declared in respect of such shares. Unless

otherwise agreed, the registration of a transfer of shares shall operate as a waiver of

the company’s lien, if any, on such shares.

3. CLOSURE OF REGISTER OF MEMBERS IN WHICH ITS

REGISTERED OFFICE IS SITUATED :

The board shall have power on giving not less than seven days previous

notice by advertisement in a newspaper circulating in the state of Tamilnadu to

close the transfer books, the register of members at such time or times and for such

period or periods, not exceeding 30 days at a time and not exceeding in the

aggregate 45 days in each year, as it may deem expedient.

4. DIRECTORS MAY REFUSE TO REGISTER TRANSFERS :

Subject to the provisions of section 111 of the act and subject as herein

after mentioned, the board may, at its own absolute and uncontrolled discretion

and without assigning any reasons , decline to register or acknowledge the transfer

of any share to any person whom it shall not approve as transferee ,

( notwithstanding that the proposed transferee be already a member ) , but in such

case it shall, within two months from the date on which the instrument of transfer

was lodged with the company , send to the transferee and the transferor notice of

the refusal to register such transfer.

5. NOTICE OF APPLICATION WHEN TO BE GIVEN:

Where in case of partly paid shares an application for registration, is made

by the transferor , the company shall give notice of the application to the transferee

in accordance with the provisions of section 110 of the act.

6. NUMBER OF DIRECTORS :

Unless and otherwise determined by a general meeting, the number of

directors shall not be less than three or not more than seven. As per the special

resolution passed at the extraordinary general meeting held on 31-10-1958, The

present directors of the company are:

1.JOHN MASTERTON

2.CLAUDE HENRY MARTIN

3. A.G.WOZENCROFT

7. APPOINTMENT OF ALTERNATE DIRECTOR :

The board may, appoint an alternate director to act for a director (here

in after called the “the original director “) during his absence for a period of not

less than 3 months from the state in which the meetings of the board are originally

held. An alternate director appointed under these articles shall not hold office as

such for a period longer than that permitted to the original director returns to the

state in which the meetings of the board are ordinarily held. If the term of office of

the original director is determined before he so returns to the said state, any

provision in the act or in these articles for the automatic re-appointment of retiring

directors in default of another appointment shall apply to the original director and

not to the alternate director.

8. QUALIFICATION OF DIRECTORS:

No share qualification shall be necessary for any director.

9. REMUNERATION OF DIRECTOR:

Every director shall be paid a sitting fees for every

meeting of the board or the committee of the board

attended by him and this amount will be fixed by the

board of directors within the maximum permissible

amount under the companies act and rules that are in

force at that time.

Every director shall be entitled to be paid all travelling,

hotel and other expenses properly incurred by him in

attending and returning from meetings of the board of

directors or any committee thereof or general meetings of

the company or in connection with the business of the

company.

10. QUESTIONS AT BOARD MEETINGS HOW DECIDED:

Action resulting from the questions arising at any meeting of the board or a

committee of the board shall require a unanimous decision.

11. DIRECTORS AND OTHERS RIGHT TO INDEMNITY:

Save and expect so far as the provision of this article shall be avoided by

section 201 of the act , the board , auditors , secretary , general manager ,

asst.secretary and other officers or servants for the time being of the company and

the trustees (if any) for the time being acting in relation to any of the affairs of the

company , and every one of them ,their hiers, executors and administrators shall be

indemnified and secured harmless out of the assets and profits of the expenses

which they or any of them , their or any of their or any of their executors or

administrators , shall or may incur or sustain by or by reason of any act done ,

concurred in or the execution of their duty or supposed duty in their respective

offices or trusts , except such (if any) as shall incur , or sustain through or by their

own willful neglect or default respectively , and none of them shall be answerable

for the acts, receipts neglects or defaults of the other or others of them , or for

joining in any receipt for the sake of conformity , or for any bankers or other

persons with whom any monies or effects belonging to the company shall or may

be lodged or deposited for safe custody , or for any other loss, misfortune trusts or

in relation thereto except when the same shall happen by through their own neglect

or default respectively.

12. SECRECY CLAUSE:

No member shall be entitled to visit or inspect any works of the company

without the permission of the board or to enquire discovery of any information

respecting any detail of the company’s trading , or any matter which is or may be

in nature of a any matter which may relate to the conduct of the business of the

company and which , in the opinion of the board, it would be inexpedient in the

interest of the company to disclose.

ORGANISATION STRUCTURE

AND

DEPARTMENTATION

ORGANISATION:

Organization is the process of combing the work which individuals or

group has to perform with facilities necessary for its execution, that the duties so

performed provided the best channels for the efficient, systematic, and positive and

co-ordinate application of the available efforts.

The term organization is also used as a function of management or as a

process carried out for arranging the task into manageable units and defining the

formal relationship among people working on different tasks. It is a series of

activities rather than a function.

ORGANISATION STRUCTURE:

It is a kind of information structure which says the relationship

between the different departments, divisions and units of an organisation as well as

the functional relationship between the different departments, divisions and union

of an organisation as well as the functional relationship between employees,

executives, etc… it enables each executive and employee to understand what is his

position in the organisation.

Organisation Structure is indispensable because a wrong structure will

seriously impair business performances and may even destroy it. The organisation

Structure must be designed so as to make possible the attainment of the objective

of the business.

ORGANISATIONAL CHART:

Diagrammatic presentation of the organisation structure is what is

known as an “Organisational Chart”. It may show the names, designation and

functions of the personnel in an organisation.

Chairman is the top most official in LIS.The overall administration is

vested with the Chairman. He is been assisted by the Managing Directors. The

chairman delegates his authority to the Managing Director. There are two Directors

in the company whose functions are delegated by the Managing Director. They are,

Director Operation and Director Technical.

The Director of Operation has three subordinates working under him

named General Manager. Manufacturing G.M, Maintenance G.M and G.M Human

Resource (HR).

CHAIRMAN

MANAGING DIRECTOR

DIRECTOR

OPERATION

DIRECTOR

TECHNICAL

GENERAL MANAGER

MANUFACTURING G.M

MAINTENANCE G.M

H.R

G.M

DEPARTMENTATION:

Departmentation means the process by which similar activities of business

are grouped into units for the purpose of facilitating smooth administration at all

levels. It is a process of dividing the large functional organisation into small and

flexible administrative units.

It increases the operating efficiency of the employees.

It makes the executive alert and responsible in his duties.

It helps in better co-ordination among the managerial personnel.

DEPARTMENTAL ACTIVITY:

There are many departments functioning successfully at LIS.

VARIOUS DEPARTMENTS Every organisation is made up of different department.   Each

department contributes to the running of the business. The most common

departments are: 

Production department

Human resource department

Marketing department

Finance department

Occupational health services department`

Fire and safety.

Projects department

Administration department

PRODUCTION DEPARTMENT

The production department is responsible for converting inputs

into outputs through the stages of production processes. The Production Manager

is responsible for making sure that raw materials are provided and made into

finished goods effectively. He or she must make sure that work is carried out

smoothly, and must supervise procedures for making work more efficient and more

enjoyable.

FUNCTIONS

There are five production sub-functions.

Production and planning.

They will set the standards and targets at each stage of the production

process. The quantity and quality of products coming off a production line will be

closely monitored.

Purchase

This department will provide the materials, components and equipment

required. An essential part of this responsibility is to ensure that stocks arrive on

time and are of good quality

stores

The stores department are responsible for stocking all the necessary

tools, raw materials and equipment required to service the manufacturing process.

Design, technical and support

They are responsible for the design and testing of new product processes

and product types, together with the development of prototypes through to the final

product.

works

This department is concerned with the manufacture of products. This will

include the maintenance of the production line and other necessary repairs. The

works department may also have responsibility for quality control and inspection.

HUMAN RESOURCE DEPARTMENT

The role of Human resource department is in charge of recruiting, training, and the

dismissal of employees in an organisation.

FUNCTIONS

Recruitment and selection

Training programs

Training programs are held by the HRD to improve the employee’s skills, as

well as to motivate them. 

There are three main types of training :

1. Induction training

2. On-the- job training

3. Off-the-job training

Manpower Planning

The HR department needs to think ahead and establish

the number and skills of the workforce required by the business in the future.

Failure to do this could lead to too few or too many staff or staff with inappropriate

needs.

Dismissal and Redundancy (retrenchment)

Dismissal is where a worker is told to leave their job due to

unsatisfactory work or behaviour. Redundancy is when the business needs to

reduce the number of employees either because it is closing down a branch or

needs to reduce costs due to falling profits. It may also be due to technological

improvements, and the workers are no longer needed.

MARKETING DEPARTMENT

These are the main section of the market departments:

Sales

  Sales department is responsible for the sales and distribution of the products to

the different regions.

Research  

Research department is responsible for market research and testing new products

to make sure that they are suitable to be sold.

Promotion

Promotion department decides on the type of promotion method for the products,

arranges advertisements and the advertising media used.

Distribution

Distribution department transports the products to the market.

FINANCE DEPARTMENT

FUNCTIONS

Book keeping procedures

Keeping records of the purchases and sales made by a business as well as

capital spending.

Preparing Final Accounts

Profit and loss account and Balance Sheets

Providing management information

Managers require ongoing financial information to enable them to make

better decisions.

Management of wages

The wages section of the finance department will be responsible for

calculating the wages and salaries of employees and organising the

collection of income tax and national insurance for the Inland Revenue.

Raising Finance 

The finance department will also be responsible for the technical details of

how a business raises finance e.g. through loans, and the repayment of

interest on that finance. In addition it will supervise the payment of

dividends to shareholders.

OCCUPATIONAL HEALTH SERVICES:

This department periodically carries out the health checkup of its

employees, contract labours and maintains the records. It also looks after the

emergence condition during accident.

FIRE AND SAFETY:

This is most important department in the refinery because all petroleum

products are highly inflammable. A separate crew is stationed inside the refinery

premises to combat the firefighting activities in case of fire. Many fire trucks,

fomenters and fire extinguishers are adequately placed to put out the fire. A

separate fire water pipeline runs throughout the refinery.

PROJECTS DEPARTMENT:

This department looks after the expansion of refineries ongoing projects

and also plan for future projects. The important sections in project department are

engineering, inspection and planning.

ADMINISTRATION DEPARTMENT:

The key function of this department to procure office equipment,

stationery, transportation, canteen facility, employee attendance, leave, garden

maintenance, office repair work and arrangement of meeting etc,.

OFFICE LAYOUT

An office is a place of management business. In other words, an office

is a place where an administrative work or management works are carried on.

Office means a place to manage or administer the company’s work. In office,

machines are operated for the management to save time and for the smooth

functioning of the company.

Office layout refers to the arrangement and placing of men and

equipment within each department or section of the office with a view to make the

best policy utilization of the available space or accommodation. It has been defined

as “The arrangement of office equipment within the available floor space”.

The office layout is scientifically planned and organized. The office is

divided into departments and sections in such a way that it helps in carrying inter-

department transactions, easily and smoothly.

The departments are situated in such a way that accessibility to

different departments is most convenient. The departments are provided with

separate cabins which help them to maintain privacy.

The office layout of LIS has been very spaciously organized. The

office layout of the company has an important bearing on the efficiency of the

employees. The furniture is also properly maintained here.

Office productivity is influenced by a number of factors, one of which is office

layout because office layout influences the entire white collar employee segment of

the organisation, its importance to organisational productivity should never be

underestimated. Office layout is based on the inter-relationships among three

Office Layout Primary factors:

Employees

Flow of work through various units

Equipment

ADVANTAGES OF GOOD OFFICE LAYOUT:

A good office layout offers the following advantages:

Increase in Efficiency:

A properly laid out office promotes efficiency as it follows the flow of

work. The moment of employees and paper follow the shortest route and this

allows for smooth flow of work.

Reduction in Cost:

A good layout aims at making the most economic and effective use of the

available floor space. Thus it leads to cost reduction in the office.

Effective Supervision:

In a good laid-out office, the amount of supervision needed would be

reduced to the minimum, thereby reducing the burden of the supervisor and saving

in the cost of supervision.

MANAGEMENT OF THE COMPANY:

The management of the LIS consists of,

Board of directors

Executive committee

Management committee

BOARD OF DIRECTORS

Elected by the shareholders, the board of directors is made up of two types

of representatives. The first type involves individuals chosen from within the

company. This can be a CEO, CFO, manager or any other person who works for

the company on a daily basis. The other type of representative is chosen externally

and is considered to be independent from the company. The role of the board is to

monitor the managers of a corporation, acting as an advocate for stockholders. In

essence, the board of directors tries to make sure that shareholders' interests are

well served. 

Board members can be divided into three categories:

Chairman – Technically the leader of the corporation, the chairman of the

board is responsible for running the board smoothly and effectively. His or

her duties typically include maintaining strong communication with the

chief executive officer and high-level executives, formulating the company's

business strategy, representing management and the board to the general

public and shareholders, and maintaining corporate integrity. A chairman is

elected from the board of directors.

Inside Directors – These directors are responsible for approving high-level

budgets prepared by upper management, implementing and monitoring

business strategy, and approving core corporate initiatives and projects.

Inside directors are either shareholders or high-level management from

within the company. Inside directors help provide internal perspectives for

other board members. These individuals are also referred to as executive

directors if they are part of company's management team. 

Outside Directors – While having the same responsibilities as the inside

directors in determining strategic direction and corporate policy, outside

directors are different in that they are not directly part of the management

team. The purpose of having outside directors is to provide unbiased and

impartial perspectives on issues brought to the board.

EXECUTIVE COMMITTEE:

The Executive Committee of the Company comprising of Managing

Director, Functional Directors, Chief Vigilance Officer and Company

Secretary meets twice a month to review broad areas of activities like

Quarterly Performance, Departmental targets, Risk Assessment and

Minimization measures, Vision and Mission statement of the Company,

Security issues, Nomination Contracts and Strategic Issues.

MANAGEMENTCOMMITTEE

As the other tier of the company, the management team is directly

responsible for the day-to-day operations (and profitability) of the company. 

Chief Executive Officer (CEO) – As the top manager, the CEO is typically

responsible for the entire operations of the corporation and reports directly to

the chairman and board of directors. It is the CEO's responsibility to

implement board decisions and initiatives and to maintain the smooth

operation of the firm, with the assistance of senior management. Often, the

CEO will also be designated as the company's president and therefore also

be one of the inside directors on the board (if not the chairman).

Chief Operations Officer (COO) – Responsible for the corporation's

operations, the COO looks after issues related to marketing, sales,

production and personnel. More hands-on than the CEO, the COO looks

after day-to-day activities while providing feedback to the CEO. The COO is

often referred to as a senior vice president. 

Chief Finance Officer (CFO) – Also reporting directly to the CEO, the

CFO is responsible for analyzing and reviewing financial data, reporting

financial performance, preparing budgets and monitoring expenditures and

costs. The CFO is required to present this information to the board of

directors at regular intervals and provide this information to shareholders

and regulatory bodies such as the Securities and Exchange Commission

(SEC). Also usually referred to as a senior vice president, the CFO routinely

checks the corporation's financial health and integrity.

INDICATORS OF GROWTH

The Company has achieved a Turnover of Rs. 22,885.17 lakhs

during the year 2012, as compared to Rs. 16908.14 lakhs in the previous year. The

profit after tax stood at Rs. 2543.50 lakhs during the year 2012. The Reserves and

Surplus also registered an increase from Rs.16358.36 lakhs as on 31-03-2012 to

Rs. 14709.52 lakhs as on March 31, 2011. LUCAS INDIAN SERVICES LTD has

not accepted any fresh public deposits during the year 2011-2012.

PERFORMANCE ANALYSIS

Performance Analysis is the process of making an assessment of the

performance and progress of the company. A financial statement is an organized

collection of data according to logical and consistent accounting procedures. The

financial statement may show a position at a movement of time as in case of a

balance sheet, or may reveal a series of activities over a given period of time, as in

case of income statement.

ANALYSIS AND INTERPRETATION:

Analysis and interpretation of financial statements refer to such a

treatment of information contained in the income statement and balance sheet so as

to afford full diagnosis of the profitability and financial soundness of the business.

Financial department is the major and important of every company in the

present world. Finance is the life blood of every business. This department is

controlled and managed by a chieARE CAPITAL:

YEAR AMOUNT (IN LAKHS)

2009-2010 807.91

2010-2011 807.91

2011-2012 807.91

1.1 Bar diagram showing share capital

2009-2010 2010-2011 2011-20120

100

200

300

400

500

600

700

800

900

INFERENCE:

The share capital of LIS for all the three years is same as

807.91lakhs. This implies that the company did not make any new issue of shares

to increase the share capital.

SALES:

Turnover of the company means the aggregate value of the realization made for the

sales, supply or distribution of goods or account of services rendered or both by the

company during the financial year.

1.2 TABLE SHOWING TURNOVER:

YEAR AMOUNT (IN LAKHS)

2009-2010 12791.95

2010-2011 16908.14

2011-2012 22885.17

1.2 CONE DIAGRAM SHOWING TURNOVER

2009-2010 2010-2011 2011-20120

5000

10000

15000

20000

25000

Column2

INFERENCE:

The turnover during the year 2009-10 was Rs.12791.95lakhs where

as it has been increased to Rs.16908.14lakhs during the year 2010-11 but there is a

steep increase in the year to Rs.22885.17lakhs during the year 2011-2012. This

indicates there is an increasing trend.

PROFIT AFTER TAX:

Profit after tax is the gain or balance left with the company after

paying all expenses and deducting tax.

1.3 TABLE SHOWING PROFIT AFTER TAX:

YEAR AMOUNT (IN LAKHS)

2009-2010 1175.15

2010-2011 1992.37

2011-2012 2543.50

1.3PIE DIAGRAM SHOWING PROFIT AFTER TAX

2009-20102010-2011

2011-2012

0

500

1000

1500

2000

2500

3000

profit after tax

profit after tax

INFERENCE:

The profit after tax during the year 2009-10 was Rs.1175.15lakhs, where

as it has been increased to1992.37lakhs during the year 2010-11and increased to

2543.50 during the year 2011-2012.This indicates the company has increased its

profit during the previous year.

RATIO ANALYSIS

Analysis and interpretation of financial statements with the help of

ratios is termed as ‘Ratio Analysis’.

Ratio Analysis involves the process of computing, determining and

presenting the relationship of item or group of items of financial statements.

Ratio analysis was pioneered by Alexander Wall who presented a

system of ratio analysis in the year 1909. Alexander’s contention was that

interpretation of financial statements can be made easier by establishing

quantitative relationship between various items of financial structure.

In the words of kennedy and mc millan “ the relationship of an item to

another expressed in simple mathematical form is known as a ratio”

MEANING OF ‘RATIO:

A ratio is a mathematical relationship between two items expressed in a

quantitative form. Ratio can be defined as ‘ relationship expressed in quantization

terms between figures which have cause and effect relationship which are

connected with one another in some manner or other’.

Ratio analysis reveals the trend in costs, sales, profit and other inter-

related facts which will be helpful in forecasting future events. Ratios can be used

as an instrument of control regarding sales, cost and profit.

Ratio analysis facilitates the communication function of the management

as they convey information relating to the present, past and future effectively.

EXPRESSION OF RATIOS

Ratios are expressed in three ways

Time

In this type of expression one number is divided by another number and the

quotient is taken as number of times.

Percentage

It is expressed in percentage

Pure

It is expressed as a proportion

The study of relationships between various items or groups of items in financial

statements is known as ‘financial ratio analysis’

OBJECTIVES

The objectives of using ratios are to test the profitability, financial position

(liquidity and solvency) and the opening efficiency of a concern.

ADVANTAGES OF RATIO ANALYSIS:

Ratio analysis is an important technique in financial analysis. It is a means

for judging the financial soundness of the concern. The advantages of accounting

ratios are as follows:

It is an useful device for analyzing the financial statements.

It simplifies, summarizes the accounting figures to make it understable.

It helps in financial forecasting

It facilitates interfirm and intrafirm comparisons

Ratio analysis is useful in finding the strength and weakness of a business concern.

After identifying the weakness, the ratios are also helpful in determining the causes

of the weakness.

GROSS PROFIT RATIO:

This ratio is also known as Gross margin or trading margin ratio.

Gross profit ratio explains the relationship between gross profit and net sales. It

includes the difference between sales and direct costs. A higher ratio is preferable,

indicating higher profitability. The gross profit ratio is expected to be adequate to

cover operating expenses, fixed interest charges, dividends and transfer to reserves.

2.1 TABLE SHOWING GROSS PROFIT RATIO:

INTERPRETATION:

The Gross Profit ratio during the year 2009-10 was 11.66% whereas it

has been increased to15.24% during the year 2010-11 and decreased to 14.57%

during the year 2011-12. This may be due to decrease in the value of goods sold.

Particular 2009-2010 2010-2011 2011-2012

Ratio

(In %)11.66 15.24 14.57

NET PROFIT RATIO:

This ratio is also called net profit to sales ratio. It is a measure of

management’s efficiency in operating the business successfully from the owner’s

point of view. It indicates the return on shareholder’s investments. Net profit

includes non-operating incomes and profits. It is the profit after reducing non-

operating expenses and provision for tax.

2.2 TABLE SHOWING NET PROFIT RATIO:

INTERPRETATION:

The net profit ratio during the year 2009-10 was 9.18% ,where it has

been increased to 11.78% during the year 2010-11 and decreased to 11.11%

during the year 2011-12.

Particular 2009-2010 2010-2011 2011-2012

Ratio

(In %)9.18 11.78 11.11

CURRENT RATIO:

The ratio of current asset to current liability is called “current ratio”. In

order to measure the short term liquidity or solvency of a concern, comparison of

current asset and current liability are inevitable. The current ratio indicates the

ability of a concern to meet its current obligations as and when they are due for

payment.

2.3 TABLE SHOWING CURRENT RATIO:

INTERPRETATION:

The current ratio during the year 2009-2010 was 3.138; in 2010-11 it was

2.043 and increased to 2.507 during the year 2011-12. This indicates the

fluctuating trend of the company.

Particular 2009-2010 2010-2011 2011-2012

Ratio3.138 2.043 2.507

FIXED ASSETS RATIO:

This ratio could also be determined by comparing the net sales with

the net fixed assets. This ratio determines the efficiency of utilization of fixed

assets and the profitability of a business concern. Higher the ratio more is the

utilization of fixed assets. A lower ratio is the indication of under utilization of

fixed assets.

2.3 TABLE SHOWING FIXED ASSETS RATIO:

INTERPRETATION:

The fixed asset ratio in the year 2009-10 is 1.544; in 2010-11it was 1.427

and increased to 2.117 during the year 2011-2012. This indicates the increasing

trend of the company.

Particular 2009-2010 2010-2011 2011-2012

Ratio

(In %)1.544 1.427 2.117

DEBT EQUITY RATIO:

This ratio is ascertained to determine long-term solvency position of a

company. Debt equity ratio is also called ‘external-internal equity ratio’. The term

external equity refers to total outsiders liabilities. Internal equity refers to

shareholders funds or the tangible net worth. Here shareholders refer to only the

equity shareholders. Ideal ratio is ‘1’.

2.3 TABLE SHOWING DEBT EQUITY RATIO:

INTERPRETATION:

The debt equity ratio in the year 2009-10 was 0.13; in 2010-2011 it

was 0.17 and increased to 0.19 during the year 2011-12.

Particular 2009-2010 2010-2011 2011-2012

Ratio

(In %)0.13 0.17 0.19