Entrepreneurship – Business Idea
Submitted to : Prof. Praveen Kumar
Submitted By :
Prashant Gupta
2D-18
PRN – 08020441163
Date Of Submission: 3/3/2010
Remarks :
Business Idea from the Newspaper: L&T Ship building capacity
1. CORE STRATEGY
a. Business vision :
To be the leading ship building company in Asia – Pacific region.
b. Business Mission :
To develop a ship building capacity to cater to the needs of growing global demand for construction of specialized ocean going vessels.
c. Product :
The Ship building facility set up for construction of high tech vessels and the facilities at the shipyard include prefabrication facilities such as shot blasting and priming, CNC cutting machine, semi panel line fabrication, unit assembly bay, block assembly and a slipway to launch the vessels along with a jetty for outfitting jobs for the ships under construction.
The shipyard is geared up to take up construction of niche vessels such as specialized Heavy lift Cargo Vessels, CNG carriers, Chemical tankers, defense & para military vessels and other role specific vessels. Construction of specialized mid size vessels is being undertaken and capacity is being augmented by additional infrastructure such as ship lift system and additional outfitting workshops to extend the activities to ship repairs.
d. Basis for differentiation :
Considering the potential for container traffic of 2.5-3 mollion TEUs in the vicinity of chennai as well as from the proposed Ennore SEZ adjacent to the site, L&T is proposing to develop a port consisting of container terminal. The proximity to national and regional road-rail transport network is advantageous for development of port at kattupalli.
2. STRATEGIC RESOURCES
d. Core Competencies:
• Shipbuilding
• Ship repair facility
• Heavy Engenering work and offshore fabrication
• Port size of 350 acres
• Ship yard of 450 acres
• Capacity (the largest ships and the highest in number in a year can be manufactured.
e. Strategic Assets:
• Existing shipbuilding facility at Hazira (gujjrat).
• Expanding capacity in existing plant (3 ships to 8 ships a year)
• Experience in a manufacturing small container.
• Out of 20 shipbuilding units maximum are state owned, only few private players in India.
• India’s share in the global shipbuilding business is expected to grow to around 15%, or $22 billion, by 2020 from the current level of 0.4%.
3. Partnership Network
f. Suppliers :
Opportunities for the global equipment suppliers who in the current economic scenario are struggling to survive and are left out with very little option to carry out the business as the orders from the customers have declined drastically. They will be facing competetion against the local suppliers who are at an home advantage and can supply the euipments at a cut down cost of transportation also they will get subsidey from the government and can provide for better delivery system as they can set up the euipment manufacturing unit near the coastal area.
Also the tieups can be done with the steel plants as the rate are moving up of the particular commodity so we can plan and organise a deal with steal company for a long term. So that we can cut down on cost and this will result into competitive prices for the final customers.
As we require a very highly skilled employees in this industry. We can setup a facility were we can tieup with one of the institutes who can provide training to the employees and employees at same time can also enroll for other courses so it will motivate the employees .
g. Partners:
• L & T Shipbuilding Ltd
• Tamil Nadu industrial development corporation limited (TIDCO)
Development of ship yard cum port complex at Kattupalli, Thiruvallur District, TN with infusion of $ 400 Million. It will be India’s one of the largest shipbuilding capacity for ocean going vessels and defence equipments.
h. Others
• CSR :
o Public health centres and conducting medical camps.
o Educational facilities for children of employees.
o Vocational training institutes for building up of skill force.
o Rural electrification programme.
Project Benefits:
• Enhancement of economy of Tamil Nadu.
• Substantial positive impact on socio-economic profile of Thirvallur region.
• Direct as well as indirect employment potential is envisaged.
• Civil amenities like medical facilities, education, sports, cultural activities are likely to improve in the surrounding villages through the CSR activities.
4. Customer Interface
i. Target Customer:
Shipbuilding industry requires a huge amount of investments. As the customer base is very small and it is majorly for the defence sector. It also attracts cusomer from the tranportation industry. But the requirement of the vessel varies from customer to customer. It starts from 10000 tonnes capacity and vary upto 110000 tonnes capacity.
It is a growing sector and Indian market is expected to grow from current market share of .4% to 15% by 2020 that is 22 billion rupees. It is attracting customer from through out the world and will be a destination for the best priced ships. The disadvantage that is attached to it is that the price varies from supplier to supplier and time to time.
j. Fulfilment Support:
As a company we are planning to provide the srevice rather that a product and thus for the same we are providing the customer with an option to signup with us for contract of service were we will provide him with repair and timely maintainance for the vessel.
In case if the customer is not willing to buy the service then we can provide him with only with the product. He will be not charged for the service that he is not opting for.
k. Pricing Structure:
As shipbuilding company the lot of factors play there role before the pricing of a product is finalised. It is an industry where the product is developed according to the customer’s requirements and that can be a container, deffence ship or might be for a personalised use.
The kind of ammeneties, reqirements vary in all such types of ship. Also lot depends on the operational cost for manufacturing of a particular
Product.
In that case the price also changes as per the quantity of ships been ordered. It is a very heavy capital intensive industry. So the client base is also very narrow. The profits in this industry starts genrating after a deffered time period.
The project development cost of shipyard cum port is about Rs 4,675 crores. The payback period is expected to be of 5-7 years. We are also expecting tax holidays from the government. In that case the payback period will reduce to 6 years.
The various types of containers and defence vehicles are
• Nuclear submarine
• Aircraft carrier
• Goods container (10,000 to 1,10,000 tonnes)
• Auxiliary ship
• Ammunition ship
• Fishing vessel
• Ironclad warship
It is expected that the company will generate the revenue of $ 70 million a year from the date of commencement of the project. We will attract customer from all over the world and also target to the defence industry in specific.
Overview
Tamil Nadu Industrial Development Corporation Limited, a government of TN enterprise, is the nodal agency to identify and promote establishment of large and medium scale industries within TN. TIDCO has commissioned 75 projects till date with a total equity investment of 250 crores.
Considering potential for shipbuilding industry in the country. TIDCO is progressing with development of shipyard cum port complex in Tamil Nadu. In view of availability of suitable waterfront with backup area and proximity to Chennai city. TIDCO has indentified site at Kattupalli in Ponneri Taluk, Thiruvallur district for development of this complex. This site is already declared as a minor port.
TIDCO has identified the leading technology, engineering and construction conglomerate. L&T for developing the shipyard cum port complex on a JV basis and submitted a proposal to government of Tamil Nadu.
The world shipping industries are venturing into areas of large vessels like VLCCs and specialised vessels such as super container liners, pure car and truck carriers (PCTC). Advanced bulkers, tankers and gas carriers. The existing shipyard in public sector and private sector do not have sophisticated facilities to construct or repair vessels of these types. The facilities available in India particularly the largest state owned shipyard are inadequate to undertake construction of large vessels. Therefore, Indian shipping companies are placing orders for large vessels on foreign shipyards. Indian share in world new shipbuilding tonnage is less than 2%.
The available repair dock days in India are about 50% of the actual requirement for servicing. Indian fleet, forcing these ships to call to foreign shipyard for repair. There will be a growing global demand for construction and repair of large vessels.
L&T intends to bridge this gap by developing a world class shipyard in India. Heavy engineering works and offshore fabrication will also be undertaken as a part of shipyard.
Submitted to : Prof. Praveen Kumar
Submitted By :
Prashant Gupta
2D-18
PRN – 08020441163
Date Of Submission: 3/3/2010
Remarks :
Business Idea from the Newspaper: L&T Ship building capacity
1. CORE STRATEGY
a. Business vision :
To be the leading ship building company in Asia – Pacific region.
b. Business Mission :
To develop a ship building capacity to cater to the needs of growing global demand for construction of specialized ocean going vessels.
c. Product :
The Ship building facility set up for construction of high tech vessels and the facilities at the shipyard include prefabrication facilities such as shot blasting and priming, CNC cutting machine, semi panel line fabrication, unit assembly bay, block assembly and a slipway to launch the vessels along with a jetty for outfitting jobs for the ships under construction.
The shipyard is geared up to take up construction of niche vessels such as specialized Heavy lift Cargo Vessels, CNG carriers, Chemical tankers, defense & para military vessels and other role specific vessels. Construction of specialized mid size vessels is being undertaken and capacity is being augmented by additional infrastructure such as ship lift system and additional outfitting workshops to extend the activities to ship repairs.
d. Basis for differentiation :
Considering the potential for container traffic of 2.5-3 mollion TEUs in the vicinity of chennai as well as from the proposed Ennore SEZ adjacent to the site, L&T is proposing to develop a port consisting of container terminal. The proximity to national and regional road-rail transport network is advantageous for development of port at kattupalli.
2. STRATEGIC RESOURCES
d. Core Competencies:
• Shipbuilding
• Ship repair facility
• Heavy Engenering work and offshore fabrication
• Port size of 350 acres
• Ship yard of 450 acres
• Capacity (the largest ships and the highest in number in a year can be manufactured.
e. Strategic Assets:
• Existing shipbuilding facility at Hazira (gujjrat).
• Expanding capacity in existing plant (3 ships to 8 ships a year)
• Experience in a manufacturing small container.
• Out of 20 shipbuilding units maximum are state owned, only few private players in India.
• India’s share in the global shipbuilding business is expected to grow to around 15%, or $22 billion, by 2020 from the current level of 0.4%.
3. Partnership Network
f. Suppliers :
Opportunities for the global equipment suppliers who in the current economic scenario are struggling to survive and are left out with very little option to carry out the business as the orders from the customers have declined drastically. They will be facing competetion against the local suppliers who are at an home advantage and can supply the euipments at a cut down cost of transportation also they will get subsidey from the government and can provide for better delivery system as they can set up the euipment manufacturing unit near the coastal area.
Also the tieups can be done with the steel plants as the rate are moving up of the particular commodity so we can plan and organise a deal with steal company for a long term. So that we can cut down on cost and this will result into competitive prices for the final customers.
As we require a very highly skilled employees in this industry. We can setup a facility were we can tieup with one of the institutes who can provide training to the employees and employees at same time can also enroll for other courses so it will motivate the employees .
g. Partners:
• L & T Shipbuilding Ltd
• Tamil Nadu industrial development corporation limited (TIDCO)
Development of ship yard cum port complex at Kattupalli, Thiruvallur District, TN with infusion of $ 400 Million. It will be India’s one of the largest shipbuilding capacity for ocean going vessels and defence equipments.
h. Others
• CSR :
o Public health centres and conducting medical camps.
o Educational facilities for children of employees.
o Vocational training institutes for building up of skill force.
o Rural electrification programme.
Project Benefits:
• Enhancement of economy of Tamil Nadu.
• Substantial positive impact on socio-economic profile of Thirvallur region.
• Direct as well as indirect employment potential is envisaged.
• Civil amenities like medical facilities, education, sports, cultural activities are likely to improve in the surrounding villages through the CSR activities.
4. Customer Interface
i. Target Customer:
Shipbuilding industry requires a huge amount of investments. As the customer base is very small and it is majorly for the defence sector. It also attracts cusomer from the tranportation industry. But the requirement of the vessel varies from customer to customer. It starts from 10000 tonnes capacity and vary upto 110000 tonnes capacity.
It is a growing sector and Indian market is expected to grow from current market share of .4% to 15% by 2020 that is 22 billion rupees. It is attracting customer from through out the world and will be a destination for the best priced ships. The disadvantage that is attached to it is that the price varies from supplier to supplier and time to time.
j. Fulfilment Support:
As a company we are planning to provide the srevice rather that a product and thus for the same we are providing the customer with an option to signup with us for contract of service were we will provide him with repair and timely maintainance for the vessel.
In case if the customer is not willing to buy the service then we can provide him with only with the product. He will be not charged for the service that he is not opting for.
k. Pricing Structure:
As shipbuilding company the lot of factors play there role before the pricing of a product is finalised. It is an industry where the product is developed according to the customer’s requirements and that can be a container, deffence ship or might be for a personalised use.
The kind of ammeneties, reqirements vary in all such types of ship. Also lot depends on the operational cost for manufacturing of a particular
Product.
In that case the price also changes as per the quantity of ships been ordered. It is a very heavy capital intensive industry. So the client base is also very narrow. The profits in this industry starts genrating after a deffered time period.
The project development cost of shipyard cum port is about Rs 4,675 crores. The payback period is expected to be of 5-7 years. We are also expecting tax holidays from the government. In that case the payback period will reduce to 6 years.
The various types of containers and defence vehicles are
• Nuclear submarine
• Aircraft carrier
• Goods container (10,000 to 1,10,000 tonnes)
• Auxiliary ship
• Ammunition ship
• Fishing vessel
• Ironclad warship
It is expected that the company will generate the revenue of $ 70 million a year from the date of commencement of the project. We will attract customer from all over the world and also target to the defence industry in specific.
Overview
Tamil Nadu Industrial Development Corporation Limited, a government of TN enterprise, is the nodal agency to identify and promote establishment of large and medium scale industries within TN. TIDCO has commissioned 75 projects till date with a total equity investment of 250 crores.
Considering potential for shipbuilding industry in the country. TIDCO is progressing with development of shipyard cum port complex in Tamil Nadu. In view of availability of suitable waterfront with backup area and proximity to Chennai city. TIDCO has indentified site at Kattupalli in Ponneri Taluk, Thiruvallur district for development of this complex. This site is already declared as a minor port.
TIDCO has identified the leading technology, engineering and construction conglomerate. L&T for developing the shipyard cum port complex on a JV basis and submitted a proposal to government of Tamil Nadu.
The world shipping industries are venturing into areas of large vessels like VLCCs and specialised vessels such as super container liners, pure car and truck carriers (PCTC). Advanced bulkers, tankers and gas carriers. The existing shipyard in public sector and private sector do not have sophisticated facilities to construct or repair vessels of these types. The facilities available in India particularly the largest state owned shipyard are inadequate to undertake construction of large vessels. Therefore, Indian shipping companies are placing orders for large vessels on foreign shipyards. Indian share in world new shipbuilding tonnage is less than 2%.
The available repair dock days in India are about 50% of the actual requirement for servicing. Indian fleet, forcing these ships to call to foreign shipyard for repair. There will be a growing global demand for construction and repair of large vessels.
L&T intends to bridge this gap by developing a world class shipyard in India. Heavy engineering works and offshore fabrication will also be undertaken as a part of shipyard.