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CHAPTER-I

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CHAPTER I

Introduction

GMR Group is an infrastructural company headquartered in Bangalore. The Company

was founded in 1978 by Grandhi Mallikarjuna Rao. Employing the Public Private

Partnership model, the Group has successfully implemented several iconic

infrastructure projects in India.

The Group also has a global presence with infrastructure operating assets and projects

in several countries including Turkey, South Africa, Indonesia, Singapore, the Maldives

and the Philippines.

Although the company started with Agro based industries like Jute/Sugar/Breweries

but slowly moved in the Infrastructure space over the past decade. Now the GMR group

interests lie in areas of Airports, Energy, Highways and Urban Infrastructure.

GMR Infrastructure Limited is the infrastructure holding company formed to fund

the capital requirements of various infrastructure projects across the sectors. It

undertakes the development of the infrastructure projects through its various

subsidiaries.

They are also actively involved in community service as a part of Corporate Social

Responsibility. The Group’s commitment to inclusive growth is achieved through

its Corporate Social Responsibility arm – the GMR Varalakshmi Foundation

(GMRVF). GMRVF works with the under-privileged sections of the community in all

the locations where the Group has business interests.

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We believe that people are the cornerstone of the Group’s success, and the company

rewards hard work, knowledge and commitment. The 7 Values & Beliefs seek to

provide a platform on which employees can perform and deliver.

The company’s human resources and benefits programs are designed to attract and

retain the best employees. The organization endeavors to provide job opportunities

across businesses, depending upon company needs and professional interest and

competency of the employees.

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CHAPTER-II

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CHAPTER II

I. Importance of Study

Organizational study is "the examination of how individuals construct

organizational structures, processes, and practices and how these, in turn, shape social

relations and create institutions that ultimately influence people", OS comprise different

areas that deal with the different aspects of the organizations, many of the approaches

are functionalist but critical research also provide alternative frame for understanding

in the field.

To develop an understanding to the management practices followed in various

functional areas.

II. AIM & ESTABLISHMENT OF THE COMPANY

GMR Group, started in 1978, having headquarters in Bangalore, India.

The GMR Group was started by Grandhi Mallikarjuna Rao. Mr. Rao started out on his

own by manufacturing cotton ear buds. He acquired a failing jute mill for at a bargain,

this venture proved to be lucrative and allowed GM Rao is use leverage from local

banks to acquire other assets. Eventually GM Rao divested his stake in a multitude of

industries and started a bank named Vysya Bank in collaboration with ING.

Mr. Rao- Marwari-Jute Business.

Mr. Rao sold off

A brewery to Vijay Mallya,

An insurance business to the Rahejas.

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Later on this, the group expanded to various sectors like highways, airports, urban

infrastructure, power generation, educational institutions and etc.

GMR group is amongst the nation's fastest growing organizations.

India's 18th and World’s 349th richest person that makes him stands apart today as a

business tycoon.

Values & Beliefs

Mission

To build entrepreneurial organizations that make a difference to society through

creation of value.

Vision

GMR Group will play a pioneering role in developing innovative projects in providing

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world-class services in infrastructure. We will grow to become a dominant player in the

field of infrastructure while sustaining our presence in agro business.

Humility

We value intellectual modesty and dislike false pride and arrogance

Entrepreneurship

We seek opportunities – they are everywhere

Teamwork and Relationship

Going beyond the individual – encouraging boundary less behavior

Deliver the Promise

We value a deep sense of responsibility and self-discipline, to meet and surpass on

commitments made

Learning

Nurturing active curiosity – to question, share, and improve

Social Responsibility

Anticipating and meeting relevant and emerging needs of society

Respect for Individual

We will treat others with dignity, sensitivity and honor

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Position of the Company

As per Forbes Magazine, G M Rao is the richest Telugu man by sheer quantifiable

wealth. He is known for his down to earth nature and simplicity despite his enormous

fortune. According to media reports, GMR Group is one of India's most trusted and

respect brands. GM Rao received the Economic Times Entrepreneur of the year Award

in 2007.

The company started with Agro based industries like Jute/Sugar/Breweries but slowly

moved in the Infrastructure space over the past decade.

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Balance Sheet

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pg. 11

The GMR group interests lie in areas like

Energy,

Highways,

Railways,

Large Urban Development,

Airports sectors,

Varalakshmi Foundation

and is known for building and operating world class national assets.

Energy

GMR Energy Limited (GMR Energy), founded in 1996 is a subsidiary of GMR

Infrastructure Ltd. It develops and generates thermal, hydro, and solar energy. It is an

ISO 14001 and OHSAS 18001 certified company. The company has power projects

across India in Orissa, Maharashtra, Himachal Pradesh, Tamil Nadu, Andhra Pradesh,

Uttaranchal, Chhattisgarh, and Chandigarh. 15 power generation assets have been

developed by the GMR Group, of which 8 are operational and 7 are under various stages

of development. With its presence across the entire energy value chain, the GMR Group

is today a prominent contributor to the Indian power sector with installed capacity of

over 2500 MW and 4700 MW under development. GMR Energy Limited is well poised

to emerge as one of the largest power producers in India.

Operating Assets

GMR Power Corporation Limited Chennai (220MW),

GMR Energy Ltd Kakinada (235MW),

GMR Vemagiri Power corporation Ltd Rajahmundry (388MW)

GMR Gujarat Solar power, Patan (25MW),

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GMR Emco Energy Ltd Warora (200MW),

GMR Kamalanga Energy Ltd Dhekanal (1400MW),

GMR Renewable Energy Ltd Kutch (2.1MW),

GMR Power Infra Ltd TN (1.25MW).

International Assets

GMR PT Barasentosa Lestari Indonesia,

GMR PT Golden Energy Mines Indonesia,

Airports

Rajiv Gandhi International Airport (Hyderabad), was constructed by GMR

Group.

The GMR Group also constructed the “Delhi’s International Airport” (3, 5, 4).

It also constructed airports in Turkey (Sabiha Gocken International Airport),

Philippines (Mactan Cebu International Airport), Malaysia and Maldives.

Highways

Tambaram - Tindivanam

Tuni - Anakapalli

Ambala - Chandigarh

Adloor - Gundla Pochanpalli

Hyderabad - Vijayawada

Hungund - Hosapet

Minority Assets

Jadcherla Expressways Ltd

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Tindivanam Uluderpet

Assets under construction

Chennai Outer ring Road

Railways

Their 1st foray of ‘Jhansi- Bhimsen’ railroad construction.

2nd Phase of MMTS in Hyderabad.

GMR Led Consortium Emerges L1 In Rs. 5000 Cr DFCC Eastern Corridor

Railway Project from Mughal Sarai to New Bhaupur (near Kanpur)

Urban Infrastructure

The Group is developing a 4300 acre multi-product Special Investment Region (SIR)

at Krishnagiri, Tamil Nadu and a 10,000 acre port based multi-product Special

Investment Region at Kakinada, Andhra Pradesh.

KRISHNAGIRI Special Investment Region

GMR Group is developing GMR Krishnagiri Special Investment Region

(GKSIR) near Hosur, Krishnagiri district, Tamilnadu. GKSIR is a Greenfield, state of

the art, large scale integrated, multi product industrial project, developed through a

Joint Venture with Tamil Nadu Industrial Development Corporation (TIDCO).

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KAKINADA Special Economic Zone

Spread over an extent of approximately 10,500 acres, the Special Investment

Region has been conceived as a Captive Port based Multi Product Special Economic

Zone. The Project would cater to the existing industries at Kakinada, mainly Process

Industries and expand into emerging sectors such as Refinery, Renewable Energy,

Ship Building, Biotech, Nanotech, IT/ITEs, Toys, Games and Sports Goods

manufacturing Park etc. in DTA (Domestic Tariff Area) & SEZ.

Assets

GMR Krishnagiri SIR

GMR Kakinada SIR

Other Business

GMR Energy Trading

GMR Electronic MFG Cluster

GMR Aviation

GMR Sports

RAXA

Varalakshmi Foundation (GMRVF)

GMR Varalakshmi Foundation (GMRVF), is the Corporate Social Responsibility arm

of the GMR Group. Its objectives are to develop social infrastructure and enhance the

quality of life of communities around the locations that has the Group’s presence. This

non-profit company has its own professional staff selected from top academic and

social work institutions, and is governed by Group Chairman, GMR Group.

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It deals with

1) Education,

2) Health, Hygiene & Sanitation,

3) Empowerment & Livelihood,

4) Community Development

Education

The Foundation aims to make quality primary, secondary and tertiary education

accessible to all. Towards this, GMRVF focuses on

a. GMR Institute of Technology

b. Sri GCSR Degree College

c. GMR DAV Public School

d. Seethamahalakshmi DAV Public School

Health, Hygiene & Sanitation

The GMR Varalakshmi Foundation started a 135 bed, Multi-Specialty Hospital at

Rajam, Srikakulam Dist. Andhra Pradesh in collaboration with the CARE Hospitals.

Empowerment & Livelihood

To empower unemployed youth through skill training and entrepreneurship

development programs.

Community Development

To improve lives & livelihood through participatory programs.

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Corporate Social Responsibility

GMR Group believes Corporates have a special and continuing responsibility towards

the society. The grim reality in India is that millions of people still do not have access

to basic amenities and live in abject poverty - a situation that cannot be redressed by

the Government alone. The business sector needs to understand its corporate social

responsibility and work towards making a difference to society

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Departments of the Company

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Back Ground

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Promoters

Performance Advisory Council keeps a check on GMR Promote.

The GMR group is full of councils —a family council at the top, a group holding

council consisting of family and two key non-family executives in the second layer,

followed by a group integration council with 25 more top executives. But the

group's most interesting initiatives is the Group Performance Advisory Council

(GPAC), a think tank of seven luminaries led by global management guru and

consultant Ram Charan.

GPAC began by assigning performance scores along various parameters. These

were uniformly low in the first year, but they have improved. "GMR's priorities

are risk management, transparency, business excellence and the council members

have enough experience to judge on these parameters," says V Sumantran, a

consultant to the Hinduja Group and GPAC member.

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Marketing Strategy

GMR Group, one of the fastest growing infrastructure enterprises in the country,

has adopted strategy of 'Asset Light and Asset Right' model to build upon its

advantage of the expertise it has developed over the years to shore up its revenues

and improve business.

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Competitors

The main competitors for the group in all the sectors are

a) Larsen & Tubro

b) Hinduja Group

c) Sarovar Group

d) Salarpuria Group

e) KVR Group

f) NCS Sugars

g) Maha Raja Sugars

h) Namma Metro

i) GVK Infra Ltd and etc.

Government Policies

The Government policies followed by the GMR Group are

a) Treasury Policy

b) Accounting Policy

c) Insurance Policy

d) Foreign Exchange policy

e) Corporate Policy

f) Financial and Risk Management Policies

Taxation Aspects

The taxes and taxation aspects followed by GMR Group are

a) Profit After Tax (PAT)

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b) Profit Before Tax

c) Provision for Taxation

d) Deferred Tax of the financial transactions and statements in a financial

year.

Achievements

a) RGIA rated as No.1 Airport in India at SKYTRAX – WORLD AIRPORT

AWARDS – 2013.

b) First Airport across the Globe to have successfully registered with United

Nations Framework Convention on Climate Change (UNFCCC) as Clean

Development Mechanism (CDM)

c) “Best Cargo Airport Award” for RGIA

d) GMR Group bags ‘Coaching Leadership Excellence Award’

e) DIAL Bags Golden Peacock Award!!

f) ASSOCHAM CSR Excellence Award 2013-14

g) VOYAGER’ AWARDS FOR ISGIA

h) Govt. of Gujarat Energy & Petro Chemicals Department –

APPRECIATION and many more.

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Share Market Position

At BSE

At NSE

Future Prospectus

GMR Infrastructure (GMR) is the holding company of the GMR group. It is

mainly engaged in the development of power and infrastructure projects. The

company has an asset base of over Rs 25,000 million,

GMR has been awarded a hydroelectric power project in Uttaranchal. It is also

looking at entering the power trading and distribution business.

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Future Plans

The company has major expansion plans for the future. In the power sector,

GMR plans to enter the power transmission business. It is also planning to supply

power up to 700 MW to Haryana from its proposed 1,000 MW power generation

project in Orissa. GMR has also planned a coal pit head project in Dhekanal, on

which the construction is expected to start by the end of 2007 and be completed by

2011.

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CHAPTER-III

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CHAPTER III

i. 7s Frame Work

Strategy

The GMR group has adopted strategy of 'Asset Light and Asset Right' model to

build upon its advantage of the expertise it has developed over the years to shore

up its revenues and improve business.

Structure

The group has an organized structure i.e. hierarchical structure and flattened

structure in taking decisions in the functioning of the organization.

System

As said, the system contains both flattened and hierarchical structures the work

progresses in a systematic manner

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Style

The style how the work progresses is fully based on expertise and experienced

people and manpower.

Staff

The Staff are fully experienced and if need to recruit; the scientific selection of

employees is applied.

Share Values

The group has lot of values and beliefs which were strictly followed by the

management and the employees and even the students of the schools and colleges

which run by them.

Skills

The employees and management are trained with new technologies i.e. training

and awareness programs are conducted up-to-date.

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SWOT ANALYSIS

A. Strength

The main strength for the group is the vision and mission that it follows

and the top management and the administration of individual units present

now in the group.

Government facilitated developmental policies

B. Weakness

a. Domestic markets

b. Taxation

c. Research & Development Cost

d. Stiff Competitors

e. Training of Employees

C. Opportunities

As India is a developing country, there are a lot many no. of opportunities

to the group i.e. new projects & ventures like

a) Construction of Airports,

b) Construction of Highways,

c) IT SEZs.

D. Threats

a) rising cost of raw materials,

b) growing competition and lower profitability,

c) increase in labor costs,

d) increasing rates of interest,

e) Global economy.

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Porters 5 forces Models of Competition

a) Threat of New-Entries

The main threat here for the GMR group is new entries like Salarpuria,

Sarovar Group, The KVR Group in construction field.

1) Economies of product differences

2) Product Differentiation

3) Brand Equity

4) Switching Costs

b) Threat of Substitutes

The main threat here for the GMR group

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1) Ease of Substitution

2) Quality depreciation

3) Relative price performance

c) Bargaining Power of Suppliers

The bargaining power of suppliers is also described as the market of inputs.

Suppliers of raw materials, components, labor, and services to the firm can be

a source of power over the firm when there are few substitutes.

1) Supplier switching costs relative to firm switching costs

2) Degree of differentiation of inputs

3) Impact of inputs on cost or differentiation

4) Presence of substitute inputs

5) Strength of distribution channel

6) Supplier concentration firm concentration ratio

d) Bargaining Power of Buyers

The bargaining power of customers is also described as the market of outputs.

The ability of customers to put the firm under pressure, which also affects the

customer's sensitivity to price changes. Firms can take measures to reduce

buyer power, such as implementing a loyalty program.

1) Buyer concentration to firm concentration ratio

2) Degree of dependency upon existing channels of distribution

3) Bargaining leverage, particularly in industries with high fixed cost

4) Buyer switching costs relative to firm switching costs

5) Force down prices

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6) Availability of existing substitute products

7) Buyer price sensitivity

8) Differential advantage (uniqueness) of industry products

e) Intensity of Competitive Rivalry

The main threat here for the GMR group is the existing competitors like

1) Raheja Group

2) Larsen & Tubro

3) Hinduja Group

4) NCS Sugars Ltd

5) Maha Raja Sugars Ltd

6) Namma Metro

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CHAPTER IV

pg. 33

CHAPTER IV

Conclusion & Recommendations

1) GMR Group has successfully achieved their goals by fulfilling their

objectives.

2) It has reached its targets and going beyond the bounds and laying new

foundation steps in various sectors (recently railways).

3) Successfully implemented their own strategies for getting success.

4) The Organizational Study on “GMR Group” has provided valuable

information for me as a management student.

Limitations of the Study

The main limitations are expressed as follows

1) The first limitation concerns the factors of competitiveness of other

competitors like Raheja Group, L & T, Sarovar and GVK Infra Ltd.

2) GMR Arrogance in dealing with Maldives Airport issue

3) A challenging economic environment, coupled with issues like the rupee's

depreciation, slow movement in contracts under execution and a rise in input

costs due to natural calamities impacted business in the last financial year.

pg. 34

Bibliography

http //www.gmrgroup.in/home.aspx

https//www.youtube.com/playlist?list=PLa_rsl7pamc4MGhLuRFqPiLZjb

IU-k648

http //www.gmrgroup.in/about-gmr-group-awards-recognition.aspx

http

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/gmr-group-company-analysis/

http //dionglobal.com/