TATA Steels Limited

Sales Forecasting Report

Product: Charge Chrome

[Type the
Submitted To author name] Submitted By

Mrs. Asmita Chitnis 9020241003

9020241039
Ashamdeep Singh Cheema
Harshleen Kaur Sawhney
9020241048 Vishal Singla
9020241050 Abhisake Sharma
9020241053 Arpit Sihra
9020241054 Bidrupa Sinha
9020241065 Sonam
Introduction: Tata Steel, the sixth largest steel producer globally, is also India’s largest fully-integrated
player of chrome. “Tata Steel is a recognized, credible and quality-conscious supplier across the globe
and is the only Asian company to receive the ‘main producer’ status for supplying ferrochrome to
customers in Japan and Europe. Steel or stainless steel has now become a lifestyle product, entering
households as elegant cutlery, tableware and decorative items; the average consumption of stainless
steel has grown at around 4.5 per cent in the last few years. What gives steel the ‘stainless’ edge is
chromite ore.

Product: Charge Chrome.

Problem: To forecast the sale of Charge Chrome for the next four quarters starting Mar 10.

Forecasting Methodology: To forecast the sales for the next four quarters, We have used the following
forecasting techniques.

• Trend Analysis
• Seasonal Variation
• Exponential Smoothing
• Moving Averages(3 and 4 Quarter)
• Weighted Moving Average(3 and 4 Quarter)

Findings:

Technique Used Mean Square Error Appendix

Trend Analysis - 967.64 I
Seasonal Variation 3 Qtr. Moving Avg. 1162.58 II
4 Qtr. Moving Avg. 1521.90 II
3 Qtr. Weighted Moving Avg. 1044.86 II
4 Qtr. Weighted Moving Avg. 1223.60 II
Exponential α=0.2 2185.59 III
Smoothing α=0.5 1072.35 III
α=0.8 974.12 III
Moving Average 3 Qtr. Moving Avg. 1240.51 IV
4 Qtr. Moving Avg. 1562.90 IV
3 Qtr. Weighted Moving Avg. 1126.07 IV
4 Qtr. Weighted Moving Avg. 1285.88 IV

Using trend analysis, exponential smoothing, seasonal variation techniques we have forecasted sales
data for the next four quarters. As calculated in appendices, the mean square error for trend analysis is
the least. This implies the forecasting of sales data is best explained by Trend Analysis out of the
techniques used.

Suggestions and Recommendations: As per our analysis, we forecast the following sales for the next
four quarters using the data from Trend Analysis.

Sr. No Quarter Forecasted Sales (in Rs. Cr.) Actual Sales ‘09 Appendix
1 Mar ‘10 274.43 288.4 I
2 June ‘10 282.91 261.7 I
3 Sep ‘10 291.38 265.3 I
4 Dec ‘10 299.86 297.1 I

As compared to actual sales of ’09, the forecasted sales are increasing except for quarter (Mar
’10).Therefore, we suggest the manager to create sufficient infrastructure and efficient resource allocation
to meet the forecasted sales.
APPENDICES

Please find the attached excel sheet for the appendices.