Industrial project report

On
“AMUL - Anand milk union limited”
Submitted to
College Code – 385
College Name- Government B.B.A College
Under the guidance of
Prof. Jyoti Jain
In partial fulfillment of the Requirement of the
award of the degree
Of
Bachelor of Business Administration (BBA)
Offered by
Gujarat University
Ahmedabad

Prepared by:
Rudra Vasan
Second year
Division : B.
Roll No: 4160
Year : 2022-2023
 Preface
This Project Report has been prepared in partial fulfilment of the
requirement for the Subject: Practical Studies of the programmer
B.B.A. (Sem. IV) in the academic year 2022-2023.

For preparing the Project Report, we have visited the AMUL –

Anand Milk Union Limited, to avail the necessary information.
The blend of learning and knowledge acquired during the visit at the
company is presented in this Project Report.

The rationale behind visiting the manufacturing company and preparing

the Project Report is to study the production basics, and
its functional areas like marketing department, services, human
resource department and financial department.
 Acknowledgement

I wish to express my gratitude to Gujarat University for giving me

an opportunity to be a part of such kind of learning experience,
which will surely enhance my knowledge and skills.

I am grateful to Prof. Jyoti Jain for her valuable guidance and

cooperation during the course of the project.

She provided me with her assistance and support whenever needed

that has been instrumental in completion of the project

The project has been a great experience, the learning and the
exposure, I got through this project was immense and will surely
help in my future pursuits.

I would like to give my heartful thanks to my parents who always

gave me moral support.
 Project Completion Certificate

This is to certify that Mr. Rudra Vasan the student of Bachelors of

Business Administration has carried out the project work as per
the syllabus of Gujarat University. He prepared this annual project
entitled “AMUL – Anand Milk Union Limited.”.

Under the guidance and contribution of Prof. Jyoti Jain in making

this report during the academic year 2022-2023 is highly
appreciated.

To the best of my knowledge the details presented by him are

original in nature and have not been copied from any other source.

Prof. Jyoti Jain

Project Guide
Date:
 Index
Sr.no. Particulars Page
no.
1 (A) Company profile
2 Name
3 Registered address
4 Brief history
5 Mission and vision
6 Form of organization
7 Organizational structure
8 Location and issues
9 Awards and achievements
10 (B) Finance
11 Turnover
12 Investment in organization
13 Balance sheet and profit and loss account
14 Capital invested in the company

15 (C) Social responsibility and future plans of the

organization
 COMPANY PROFILE

Gujarat Cooperative Milk Marketing Federation (GCMMF) is India's largest food products
marketing organization. It is a state level apex body of milk cooperatives in Gujarat which aims
to provide remunerative returns to the farmers and also serve the interest of consumers by
providing quality products which are good value for money.
The seeds of our Gujarat Co-operative milk marketing federation were sown in November 1973
with the simple intention of ensuring a fair return to tile producers. The intention was to receive
all the milk offered by them.
Anand Milk Union Limited is an Indian Diary company. The company headquarter is in Anand,
Gujarat, India. It is an India’s largest food products organization with a total brand turnover of
USD 5.1 Billion. The company is popularly known as ‘AMUL’, aims to provide remunerative
returns to the farmers and also serve the interest of consumers by providing quality products
which are good value for money.

The product portfolio include milk- UHT and pouch, buttermilk, ghee, butter, sweetened
condensed milk, milk powders, infant milk food, dairy whitener, tea and coffee whitener, lassi,
ice-cream, paneer-fresh and frozen, cheese, cheese spreads, margarine, flavored milk,
gulabjamun, milk shakes, malted foods and drinks, probiotic dahi and chocolates.

The intention was to help member unions develop adequate production and processing
facilities. The intention was to process all the milk received.The intention was to develop a
product -mix that would promote sustained growth. The intention was to offer consumers
quality products of fair prices and to do so by achieving economics of scale and costs. The
intention was to create and expend a milk grid to maximize the availability of liquid milk.

Name :- AMUL DIARY

A- Anand

M- Milk

U- Union

L- Limited

Registered Office Address :- 2- AJI INDUSTRIAL ESTATEPLOT NO: 332/333, GIDC

RAJKOT, INDIA 360003.
 Brief history

In 18th century British came into India, with them their culture and trends also came. They are
the most consume people of tea, whether most tea produce by Asian countries. For making tea
milk also necessary because it is related products. Day to day the demand of milk get increased
up to a very high level, thus its result into a big business of dealing of milk, it means that was
a big profit also and we know that where there Is a profit, there lies exploitation.

During First World War the demand of milk was very high and the suppliers were exploiting
the consumer. Ina 1929, on Parsi named Pestanji came Anand from Bombay and he started a
dairy called POLSON (well-known brand for butter) from which the milk was transported to
Bombay for the British. During Second World War POLSON dairy started exploiting milk
producers. With this milk producer get angered on the POLSON dairy and decide to not to
further provide milk to this dairy and at that time was the independence, fight was there and
POLSON dairy milk to military of the British Government.

But some farmers through that if they don't provide milk then they would be in great trouble.
For solution of the same, they went to Mumbai to talk to the "Iron Man of India" Shri Sardar
Vallabhbhai Patel and he said that if the farmers went to raise their level, they should built up
a Co-operative milk society and responsibility of this task given to Shri Morarjibhai Desai.

Mission and vision

Vision

The vision statement for Amul Dairy is its strategic plan for the future – it defines what and
where Amul Dairy Company wants to be in the future. The vision statement for Amul Dairy is
a document identifying the goals of Amul Dairy to facilitate its strategic, managerial, as well
as general decision making processes.

Mission
We at GCMMF (Gujarat Co-operative milk Marketing Federation) endeavour to satisfy the
taste and nutritional requirements of the customers of the world, through excellence in
marketing by our committed team. Through co-operative networking, we are committed to
offering quality products that provide best value for money.”

The mission of Amul Dairy is a public document that details the values and strategic aims of
Amul Dairy. The mission statement of Amul Dairy also identifies the purpose of the
organization existence, highlighting the services and the products it offers. Further, the mission
statement also identifies the organization’s operational goals for Amul Dairy, the processes the
company uses to achieve those, the target customer groups, and the region where the company
operates.

Form of organization

Anand Milk Union Limited (AMUL) is an Indian dairy state government cooperative
society, based in Anand, Gujarat. Formed in 1946, it is a cooperative brand managed by
Gujarat Cooperative Milk Marketing Federation Ltd. (GCMMF), which today is controlled
jointly by 36 lakh milk producers in Gujarat and the apex body of 13 district milk unions,
spread across 13,500+ villages of Gujarat. Amul spurred India's White Revolution, which
made the country the world's largest producer of milk and milk products.

Tribhuvandas Kishibhai Patel under the guidance of Sardar Vallabhbhai Patel became the
founding chairman of the organization and led it until his retirement in the 70s. He
hired Verghese Kurien in 1949 and convinced him to stay and help with the mission. [7][8] Under
the chairmanship of Tribhuvandas, Kurien was initially the general manager and helped guide
the technical and marketing efforts of Amul. Kurien was the chairman of Amul briefly after
Tribhuvandas Kishibhai Patel died in 1994. Kurien, founder-chairman of the GCMMF for more
than 30 years (1973–2006), is credited with the success of Amul's marketing. [9]

Organizational structure

Amul has three tier organization structure:

• At the village level :- There was Society that residents of the village owning cows or buffalos
could join by purchasing share and committing all surplus milk beyond their household needs.
On the other hand farmers were also able to purchase affordable cattle feed and other services
from the society.

• At the district level :- There was Union owned by the contributing dairy cooperative societies.
Unions are responsible for purchasing milk from societies and transporting those to dairy plants.
These unions also manufactured cattle feed, provided the societies with cattle support , artificial
insemination, and trained farmers in animal husbandry.

• At the top level :- All these unions came under a single umbrella called GCMMF. This
organisation allowed all the districts to market their products under a common brand, it has
elected members from all district Unions. GCMMF also jointly procured raw materials ,planned
individual product mixes, established a common distribution network for unions etc.

Location and issues

Location:-

Amul is an Indian dairy cooperative, based at Anand in the state of Gujarat. Founded in
1946, the brand is today managed by the Gujarat Co-operative Milk Marketing Federation Ltd
(GCMMF) which is jointly owned by about 3 million milk producers in the state.

The Amul model has helped India to emerge as the largest milk producer in the world. More
than 15 million milk producers contribute their milk in 144,500 dairy cooperative societies
across the country. Their milk is processed in 184 district co-operative unions and marketed by
22 state Marketing Federations, ensuring a better life for millions.

Issues:-

In inter-state transport, the dairy cooperative is facing delay in empty trucks coming back from
other states to Gujarat after delivering milk. In terms of transport, Amul is also facing issues in
supply of ingredients for cattle feed. While some of the ingredients are available within Gujarat,
 Amul's cattle feed plants source raw materials like rice bran, corn, millet, and molasses from
other states like Punjab, Haryana and Rajasthan. "These ingredients are crucial so that we can
supply cattle feed to farmers so that milk procurement is not hampered," he said.

Another issue that could hamper Amul's supplies is packaging material. "No factory gives more
than a fortnight of packaging material. They should also be allowed to operate and their workers
should be provided free movement so that milk and food items' packaging supplies do not take
a hit."

Awards and Achievement

 GCMMF received Bronze Trophy at the Indian Marketing Awards – 2014

 GCMMF – Finalist in World Beverage Innovation Awards - 2014
 GCMMF received APEDA Awards for 16 years continuously
 Amul wins World Dairy Innovation Awards - 2014
 Amul receives Srishti Good Green Governance award for the year 2013
 GCMMF Receives Prestigious CNN-IBN Innovating for a Better Tomorrow Award
 Amul wins AIMA High Performance Brand Award-2013 for brand Amul
 Shri R S Sodhi, MD-GCMMF, receives prestigious QIMPRO GOLD STANDARD Quality
Award 2013
 GCMMF wins the SAP Award for Customer Excellence (SAPACE) 2013 under the category
of "Best Run Award in Finance"
 ET-Corporate Citizen Award of the Year 2010-11 to GCMMF
 Amul receives Green Globe Foundation Award
 Dr. V.Kurien honoured with Life Time Achievement Award
 GCMMF receives Srishti's G-Cube Award - 2010
 Amul Bags International Dairy Federation Award
 Amul Bags Srishti G-cube Award For Good Green Governance - 2009
 Amul Pro-Biotic Ice-cream Gets No. 1 Award At World Dairy Summit
 Ramkrishna Bajaj National Quality Award - 2003
 Qimpro Gold Standard Award - 2003
 Amul - The Taste Of India (GCMMF) Receives International CIO 100 Award For
Resourcefulness
 Rajiv Gandhi National Quality Award - 1999
 Finance

Management of funds is a critical aspect of financial management. Management of funds acts

as the foremost concern whether it is in a business undertaking or in an education institution.
Financial management, which is simply meant dealing with management of money matters.

Financial management is that managerial activity which is concerned with planning and
controlling of the firm financial resources.
All the other department of the organizations strongly depend upon the finance department to
carry on their departmental activity efficiently. Hence it is the responsibility of the finance
function with proper care, adequate financial availability in time. The organization will lead to
success and the failure manager of the finance will lead to in efficiency.

Financial management was considered a branch of knowledge with focus on the procurement
of funds. Instrument of financing, merger and restricting of firm, legal and institutional frame
work invaded there in occupied the prime place in this traditional approach.

Turnover

Celebrating 75th year of its cooperative movement, Amul has clocked a group turnover of Rs
61,000 crore for financial year (FY) 2021-22, further consolidating its position as the largest
food and FMCG brand in India.

Currently ranked as the eighth largest dairy organisation in the world, the Gujarat Cooperative
Milk Marketing Federation (GCMMF), which owns and markets products under the brand
name Amul, added another Rs 8,000 crore to its group turnover in 2021-22.

According to the federation, the growth in its turnover came on the back of rapid post-pandemic
recovery in out-of-home consumption and demand from restaurants, catering, travel and
hospitality segments.

"As we move beyond the pandemic, consumers are rewarding us by displaying higher
preference for brand Amul. As out-of-home consumption returns to normalcy, restaurants are
witnessing higher footfalls, travel and tourism has resumed and so have functions and
gatherings. The combined impact of all these factors is resulting in high growth across most
product categories," said R S Sodhi, managing director of GCMMF.

Amul's milk-based beverages business grew by 36 per cent in value terms, its ice-cream
business also saw a sharp revival with a more than 50 per cent value growth in 2022.

Amul Butter grew by 17 per cent, while our Ghee business grew by more than 19 per cent, both
in value terms. We achieved 17 per cent value growth in Amul long life milk, 44 per cent value
growth in Amul Cream, 24 per cent value growth in Amul Dahi, 18 per cent value growth in
fresh Buttermilk and impressive 12 per cent value growth in our largest product category, Amul
fresh milk.

As part of its product innovation initiatives, Amul also launched products like High Protein
Lassi, High Protein Buttermilk, Speciality Cheeses, Amul Peanut Spread, a wide range of fresh
ethnic Indian milk-based mithai and Amul Butter-based bread, cookies and bakery products in
multiple markets.

Over the last 12 years, our milk procurement has increased by a phenomenal 190 per cent. This
impressive growth was a result of the high milk procurement price – which has increased by
143 per cent during this 12 year period – paid to our farmer-members.

Amul incurs a capital expenditure (capex) of Rs 800-1000 crore annually for capacity
expansion. "We are also expanding in fresh products (milk, curd and buttermilk) and a new
dairy plant, with an investment of Rs 500 crore, will come up in Rajkot. Within two years,
large dairy plants will also come up in Baghpat, near Delhi, Varanasi, Rohtak and Kolkata.
 Investment in the organization

GCMMF, which markets dairy products under the Amul brand, will invest around Rs 1,000
crore over the next two years to set up milk processing plants, and another Rs 500 crore on
facilities for new products like edible oil, its MD R S Sodhi said. In an interview with, Sodhi
said the Gujarat Cooperative Milk Marketing Federation Ltd (GCMMF) expects 12-15 per cent
growth in revenue in current fiscal year from Rs 38,550 crore during the last fiscal year despite
COVID-19 pandemic, as demand for branded food products has been increased.
They will invest around Rs 1,000 crore in the next two years on setting up dairy plants across
various states.
And the processing capacity would increase to 420 lakh litres per day from the current 380 lakh
litres per day.
Besides, GCMMF has forayed into edible oil and potato processing segments as part of its
objective to boost income of farmers from Gujarat and other states.
The edible oils will be marketed under the new brand 'Janmay'. It will produce groundnut oil,
cottonseed oil, sunflower oil, mustard oil and soybean oil.
Amul sells 140 lakh litres of fresh milk per day, mainly in Gujarat, Delhi-NCR and Uttar
Pradesh. Its dairy products are sold across the country.
 Profit and loss account
Fy-19 Fy-20 Fy-21
Gross sales 3,31,943 3,85,757 3,93,222
Less:- excise duty - - -
Net sales 3,31,943 3,85,757 3,93,22
Growth 13.5% 16.2% 1.9%
Expenditure
Cost of goods sold 3,16,447 3,69,001 3,75,664
Staff cost 1,742 2,184 2,039
Manufacturing expense 2,006 1,901 2,299
Marketing and selling expense 8,378 9,482 9,862
Other expense 1,157 1,245 1,267
Ebitda 2,214 1,946 2,091
Ebitda Margin (%) 0.7 0.5 0.5
Depreciation 1,248 1,360 1,377
Ebit 966 585 714
Interest expense & Bank expense 464 245 169

Other income 297 513 330

Profit before tax 799 854 875
Income taxes 271 291 266
Effective tax rate (%) 33.9 34.1 30.4
Profit after tax 528 562 609
 Balance sheet
FY-19 FY-20 FY-21
Sources of fund
Share capital 2,401 2,401 2,401
Reserve and surplus 2,638 2,840 3,064
Differed tax liability (142) (142) (187)
Net Worth 4,897 5,098 5,278
Secured Loans 12,236 4,031 18,757
Unsecured Loans 451 499 501
Total Loans 12,686 4,530 19,259
Total 17,583 9,628 24,537
Application of Funds
Fixed Assets
Gross Block 16,031 16,077 17,881
Less: Depreciation 8,582 9,560 10,856
Net Block 7,450 6,517 7,025
Capital WIP 135 332 69
Gross Block-Brand value 16,031 16,077 17,881
Other Investments 844 918 731
Current Assets 39,582 29,328 43,193
Inventories 16,208 14,143 25,922
Sundry Debtors 5,427 4,253 3,303
Cash & Bank Balances 8,840 7,661 9,690
Loans & Advances 9,107 3,270 4,279
Current Liabilities 30,428 27,468 26,481
Liabilities 30,143 27,097 26,220
Provisions 285 371 261
Net Current Assets 9,154 1,860 16,712
Total 17,583 9,628 24,537
 Capital invested

Amul Capital Private Limited is a Non-govt company, incorporated on 14 Mar, 1997. It's a
private unlisted company and is classified as'company limited by shares'.

Company's authorized capital stands at Rs 5.0 lakhs and has 0.0% paid-up capital which is Rs
0.0 lakhs.
Amul Capital Private Limited is in the business from last 26 years and currently, company
operations are active.
 Source of funds
Companies always seek sources of funding to grow their business. Funding, also called
financing, represents an act of contributing resources to finance a program, project, or need.
Funding can be initiated for either short-term or long-term purposes. The different sources of
funding include:

Retained earnings: -

Businesses aim to maximize profits by selling a product or rendering service for a price
higher than what it costs them to produce the goods. It is the most primitive source of funding
for any company.

After generating profits, a company decides what to do with the earned capital and how to
allocate it efficiently. The retained earnings can be distributed to shareholders as dividends, or
the company can reduce the number of shares outstanding by initiating a stock repurchase
campaign.

Alternatively, the company can invest the money into a new project, say, building a new
factory, or partnering with other companies to create a joint venture.

Debt capital:-

Companies obtain debt financing privately through bank loans. They can also source new funds
by issuing debt to the public.

In debt financing, the issuer (borrower) issues debt securities, such as corporate bonds or
promissory notes. Debt issues also include debentures, leases, and mortgages.

Companies that initiate debt issues are borrowers because they exchange securities for cash
needed to perform certain activities. The companies will be then repaying the debt (principal
and interest) according to the specified debt repayment schedule and contracts underlying the
issued debt securities.

The drawback of borrowing money through debt is that borrowers need to make interest
payments, as well as principal repayments, on time. Failure to do so may lead the borrower to
default or bankruptcy.

Equity capital:-

Companies can raise funds from the public in exchange for a proportionate ownership stake in
the company in the form of shares issued to investors who become shareholders after
purchasing the shares.

Alternatively, private equity financing can be an option, provided there are entities or
individuals in the company’s or directors’ network ready to invest in a project or wherever the
money is needed for.

Compared to debt capital funding, equity funding does not require making interest payments to
a borrower.

However, one disadvantage of equity capital funding is sharing profits among all shareholders
in the long term. More importantly, shareholders dilute a company’s ownership control as long
as it sells more shares.

Now will discuss about sources of fund of AMUL company

1. As the products are sold on a daily basis to Gujrat Co-operative Marketing Federation

(GCMMF). An amount is given by the federation to the union so that it gets paid for the sale of

its products.

2. The societies that are involved in its functioning hold fixed deposits that act as a major

source of capital.

3. As these Fixed deposits release some kind of Interest when deposited in banks like UTI,

BOB etc. These act as another source of the finance.

4. The share capital is not public hence it is not listed in the market it is exclusively for the

members of the society.

 Social Responsibility
It is a company which started way back in the time, even before the independence of India in
1947 to be precise 8 months before the Indian Independence. It is an Indian Dairy Cooperative
( A cooperative (“coop”) or co-operative (“co-op”) is an autonomous association of people
who voluntarily cooperate for their mutual social, economic, and cultural benefit) founded and
owned by over 3 million farmers in the state of Gujarat, India. They are India’s largest food
product marketing organisation selling a variety of dairy based products like milk, cheese, ice
cream, butter and other products. They are well known for their high quality, social
responsibility and reasonable pricing. They exhibit high levels of CSR (Corporate Social
Responsibility) which literally means as the commitment of a business to serve the people and
economy in a more socially responsible way rather than focussing on the sole goal of earn
profits.
According to the article the co-operative is a three tier organisation where the first tier is seen
as the co-operative society at the village, where the villagers produce milk voluntarily. They
are managed by a 9 member managing committee and do business by selling the milk produced
by the villagers to the district. In Gujarat statistics state that there are over 11,000 co-
operatives. The second tier consists of the district co-operative that processes the milk
produced, into milk products sells to the state co-operative national and international
marketing. 12 district co-operatives are seen in Gujarat, each district with 15 democratically
nominated members. The state level so-operative or the Gujarat Co-operative Milk Marketing
Foundation is seen as the third tier. They are responsible for the marketing of milk and milk
products both produced and sold. The members are also democratically elected by and from
amongst chairmen of the district co-operatives.
This 3 tier structure is indeed the most unique institution the business world has seen. In this
institution there is no machine intervention, it is completely handled by humans. In a recent
study it is shown in the Amul institution there are over 23,60 Lakh workers in 15 dairy plant,
750 marketing professionals: 10,500 salesman in distribution network and 600,000 salesman
in retail network. This institution have been the silver lining in the clouds for most of the
farmers in Gujarat.

“Amul had pioneered inclusive growth through work with dairy farmers at grass-root level,
changing lives, enhancing income, empowering women and at the same time reaping benefits
to the business.”

Companies through adoption of shared value concepts could tackle challenges of poverty and
malnutrition in India.

Future plans of the organization

Amul’s expansion plans are based on how much milk we will be getting. Generally, every year
there is an expansion by Rs800 crore to Rs1,000 crore. We are getting 9 per cent more milk,
which means 25 lakh litres. That means an investment of Rs1,000 crore. We are investing in
Gujarat and outside in various product categories.

We are expanding in fresh products (milk, curd and butter milk). A Rs500-crore dairy is coming
up in Rajkot; land is being allocated by the state. Within two years, big dairy plants will also
come up in Bagpat, near Delhi, Varanasi, Rohtak and Kolkata. The total investment would be
between Rs300 crore and Rs500 crore.

We are also eying Rs1,000 crore in exports. Amul exports to some 55 countries, though mainly
to neighbouring countries.