Acknowledgements

Thanking Almighty Allah, who bestowed me the knowledge and the courage to write this
report. Ialso thank honourable Sir Nazik Hussain for his in class contribution which
prepared and showed methe way to complete the internship and the writing of this report.
Thank you, Sir; indeed we owe youa great deal. This internship provided me a golden
opportunity to learn. In this report I have tried torelate everything that I thought was
necessary. Though, its a bit difficult to say anything about theperfection of the effort that
I have made but I hope that it finds its place somewhere to meet therequired and expected
criterion. I would like to add a few deepest words for the people who werepart of this
report in numerous ways people who gave unending support right from the stage
thereport was assigned. Particularly I also wish to thank the managerial staff at Nishat
House whohelped me to gain a lot of information regarding the company and cement
industry and also thankfulto Mr. Inayat Ullah Niazi (CFO, DG Khan Cement Company)
who provide me an opportunity to learnand understand the working of organization as an
internee. I am also thankful to Mr. Hamid Shah(Senior D. Manager Finance) who played
a role of polar star for me in the organization and whoseexperience taught me a lot about
the industry and the organization.I am especially thankful to Mr. Mukhtar Ahmad (Senior
Manager Production) who helped me a lot ingetting the knowledge of cement
industry.And finally deepest and warmest appreciation to the whole team of DG Khan
Cement Company whohelped me a lot in getting knowledge about the office working and
about the cement plant of DG Khan.
 Executive Summary
Dera Ghazi Khan Cement Company Limited is a strategic business unit of Nishat Group,
which is the largest industrial group in Pakistan. D.G. Khan Cement Co. is market leader
with respect to market share with about 11.4% market share. Apart from its competitors;
its product is high priced yet it has highest market share because of good quality. Its plant
is situated in Dera Ghazi Khan and DG Khan and head office is situated at Lahore.
Factory site Unit 1and 2 that is situated in very remote area of Punjab, yet it proved a
blessing for the company. Because it has all three basic raw materials i.e. Lime stone,
Shale, and Gypsum at one place. It has three plants working two in D.G. khan and one in
DG Khan. First plant is old one and it is Japanese plant. The other two plants are of F.L.
Smiths, Denmark. Presently it has a total Installed capacity of 14000 tpd (tons per
day).Presently the company is also exporting the cement to Afghanistan, Iraq, UAE and
Russia. The team of the D.G. Cement is story of success of D.G. Cement. The whole
team is self-motivated and had played a vital role in the success of the company
Dedication
To my beloved parents, teachers and friends whose Endeavour supplications made me
able to get this success
Corporate Information Company
Name: D.G. KHAN CEMENT COMPANY LIMITED
Legal Status: Public Limited Company Registered
Office: Nishat House, 53-A, Lawrence Road, Lahore, Pakistan
Phone: 92-42-6367812-20Fax: 92-42-6367414
E-mail: info@dgcement.com
Web: www.dgcement.com
Chairperson Mrs. Naz Mansha
Chief Executive Mr. Mian Raza Mansha
Board of Directors
Mr. Khalid Qadeer Qureshi
Mr. Farid Fazal
Mr.Zaka ud din
Mr.Inayat Ullah Niazi(CFO)
Ms.Nabiha Shahnwaz Cheema
Companys Secretary: Mr. Khalid Mahmood Chohan
External Auditors: KPMG Taseer Hadi & Co, Chartered Accountants
Legal Advisor: Mr. Shahid Hameed, Bar-at-Law
Bankers:
Allied Bank Limited
Habib Metropolitan Bank Limited
Askari Bank Limited
MCB Bank Limited
Bank Alfalah Limited
NIB Bank
Bank Islami
Pakistan Limited
Meezan Bank Limited
Barclays Bank Plc
National Bank of Pakistan
Citibank N.A.
Samba Bank Limted
Deutsche Bank AG
Standard Chartered Bank (Pakistan)
Dubai Islamic Bank Limited
Faysal Bank Limited
Silk Bank Limited
First Women Bank Limited
The Bank of Punjab
Habib Bank Limited
United Bank Limited
HSBC
Sales Offices:
Lahore Regional Sales Office
Multan Regional Sales Office
DG Khan Regional Sales Office
Karachi Regional Sales Office

Introduction
DG Khan Cement Company Limited (DGKC) is a producer and seller of ordinary
Portland and Sulphate-resistant cement. The company is a unit of Nishat group which is a
leading and diversified business group with a strong presence in the three most important
sectors of Pakistan: textiles, cement and financial services. The group also has
considerable stake in insurance, power generation, paper products and aviation sectors.
DGKCC is listed on the stock exchanges of Karachi, Lahore and Islamabad.
About
D.G. Khan Cement Company Limited (DGKCC), a unit of Nishat group, is the largest
cement-manufacturing unit in Pakistan with a production capacity more than 5,500 tons
clinker per day. It has a countrywide distribution network and its products are preferred
on projects of national repute both locally and internationally due to the unparallel and
consistent quality. It is listed on all the Stock Exchanges of Pakistan. D.G.Khan Cement
Company has the largest cement manufacturing capacity in the country.

Listed in 1992, D.G.Khan Cement was established by the State Cement Corporation of
Pakistan (SSCP) at Dera Ghazi Khan in 1986. It was privatized to the Nishat group in
1994-95 at Rs35.90 per share.

Nishat Group
Nishat Group is one of the leading and most diversified business groups in South East
Asia. With assets over PRs.300 billion 0r $3.5 billion, it ranks amongst the top five
business houses of Pakistan. The group has strong presence in three most important
business sectors of the region namely Textiles, Cement and Financial Services. In
addition, the Group has also interest in Insurance, Power Generation, Paper products and
Aviation. It also has the distinction of being one of the largest players in each sector. The
Group is considered at par with multinationals operating locally in terms of its quality of
products & services and management skills.

Mian Mohammad Mansha: The chairman of Nishat Group continues the spirit of
Entrepreneurship and has led the Group successfully to make it the premier business
group of the region. The group has become a multidimensional corporation and has
played an important role in the industrial development of the country. In recognition of
his unparallel contribution, the Government of Pakistan has also conferred him with
Sitara-e-Imtiaz, one of the most prestigious civil awards of the country.
Acquisition of DGKCC by Nishat Group
Nishat Group acquired DGKCC in 1992 under the privatization initiative of the
government. Starting from the privatization, the focus of the management has been on
increasing capacity as well as utilization level of the plant. The company undertook the
optimization by raising the capacity

Immediately after the privatization by 200tpd to 2200 tpd in 1993. Now a day the export
demand of D.G cement is 2000 TPD. Presently D.G.K.C.C export cement to Afghanistan,
Iraq AND UAE.

Vision Statement
To transform the Company into modern and dynamic cement manufacturing company
with qualified professional and fully equipped to play a meaningful role on sustainable
basis in the economy of Pakistan.

Mission Statement
To provide quality products to customers and explore new markets to promote/expand
sales of the Company through good governance and foster a sound and dynamic team, so
as to achieve optimum prices of products of the company for sustainable and equitable
growth and prosperity of the Company.

Brands (Product)
Two different products are produced at DGKCC namely Ordinary Portland Cement and
Sulphate Resistant Cement. These products are marketed through two different brands:
DG brand & Elephant brand Ordinary Portland Cement (It is also called the OPC
and its demand is about 92% because of commonly used).
DG brand Sulphate Resistant Cement (It is also called the SRC and its demand is
about only 8%because it is only used in standing the foundations its main work is
to finish the pours produced while standing the foundations and made the
foundations much strong). In addition to following two brands they are also
offering four different packaging which are as following:
o OPC
o SRC
o ELEPHANT BRAND
o DG PLASTIC BAG

Performance
DGKCC is part of the solution and it has the track record to prove it. A leader in the fight
against pollution, DGKCC has been a pioneer in developing innovative methods for
recycling. Its patented cement-making process -- CemStar -- significantly reduces carbon
dioxide (CO2) and nitrogen oxide (NOx) emissions in the cement- making kiln process.
Today, cement producers throughout the PAKISTAN use that process, resulting in a
cleaner environment nationally. The Company constantly seeks new ways to utilize
innovative technologies in its environmental protection programs. The commitment made
by D.G.K.C.C to the environment is paramount, the Companys kilns use the most
advanced air pollution control systems ever utilized by a cement plant in PAKISTAN.

Capacity Addition
To meet the increasing demand and to capitalize on its geographic location, the
management further expanded the capacity by adding another production line with a
capacity of 3,300 tons per day in year 1998. Design of the new plant is based on latest dry
process technology, energy efficient and environmental protection from particulate
pollution according to the international standards. The plant and machinery was supplied
by M/s F.L. Smiths of Denmark. As a result, DGKCC emerged as the largest cement
production plant in Pakistan with annual production capacity of 1,650,000 M tons of
clinker (1,732,000 M. Tons Cement) constituting about 10% shares of the total cement
production capacity of the country. The optimization plan is still underway to increase the
total capacity of the two units to 6700 TPD by mid of 2005 from 5500 TPD at present.

Sales and Production

DG Khan Cement hit a major land mark regarding growing sales, despite the severe
power crises and security situation of the state. Moreover, due to global recession and the
liquidity & credit crunch, the buying power of the major customers both at home and
abroad was looking bleak. Local sales decreased by 14%, while the exports passed the 10
million ton mark. Also the company had to recover from a negative profit after tax due to
a huge amount of debt leverage in the balance sheet. Despite all these factors the
company due to sharp and effective steps recorded a huge boost in sales of 45%, a figure
which even overshadowed the 17.86% rise in the operating cost thus registering a profit
after taxes of Rs 525m. The exports also doubled playing a major part in the increasing
sales. The companys production of both cement and clinker was less than the previous
year. The cement production was 8.3% less than the year 2008-09 due to lack of
resources like power and also due to the weakening buying powers of the customers
because of inflation. The production of clinker followed similar trend being 4% less than
FY08 in FY09.

Plant Operation and Production

Clinker production during the period underreport is good and all the plants operated well.
Cement production during the first six months of the current financial year declined by
14% on account of less cement demand both in the country and in export markets,
whereas, the cement production during the 2nd quarter declined by 6%.

Sales
Cement sales in the country plunged by nearly28% during the first half of final year
compared with the corresponding period. Whereas during the 2nd quarter the local sales
declined by 29%.Thedecline is attributed to poor construction activities both in housing
sector as well as in public sector. Bleak stimulus in cement off take in the country forced
your company to eye again on international markets. During the period, despite
international recession in regional markets, export of cement augmented by nearly 64%
during the first half of the year, whereas during the 2nd quarter i.e. Oct the export grew
by nearly 192%. The company is making all out effort to fully capitalize its operating
capacities.

Alternative fuel project

The company has also decided to use agriculture and other wastes as fuel instead of
expensive coal and petroleum products. A first phase has been completed at DG Khan
Cement plant in which the company is using different industrial wastes like rice husk,
cotton sticks, wheat straw and molasses. This has cut down daily use of imported coal by
50 to 70 tons. The second phase is expected to be completed by fiscal 2018 at a cost of
Rs1.25 billion. These projects are expected to bring substantial savings in fuel costs, the
company said.

Environmental Management
DG Khan Cement Co. Ltd., production processes are environment friendly and comply
with the World Banks environmental standards. It has been certified for Environment
Management System SO 14001 by Quality Assurance Services, Australia. The company
was also certified for ISO-9002(Quality Management System) in 1998. By achieving this
landmark, DG Khan Cement became the first and only cement factory in Pakistan
certified for both ISO 9002 & ISO 14001...

On Going Projects
The work on first phase of Refused Derived Fuel (RDF), alternative fuels, at DG Khan
Cement plant has been successfully completed and your company has started replacing
imported coal with different alternative fuels, e.g. industrial and agricultural wastes,
cotton sticks, corn cops, rice husk and rice powder, municipal waste etc. After reviewing
the encouraging results of RDF project at DG Khan Cement plant your company has
decided to implement the first phase of RDF at DG khan site and also started extension
phase at DG Khan Cement plant. The projects are expected to be completed in the current
calendar year. This will result in savings on account of fuel costs. Ongoing power
shortage and rising tariff forced your company to start power generation from waste heat
recovery at DG Khan Cement plant. The project is expected to generate 8.5MW. Plant
&machinery will be supplied by M/s. FL Smidth Denmark. The letter of credit has
already been established. The project is expected to be completed in the first quarter of
next year. This project will reduce reliance on power purchase from WAPDA and bring
down the cost of production.

Business Process
1. Cement acts as a binding agent, holding particles of aggregate together form
concrete.
2. Cement production is highly energy-intensive process and involves the chemical
combination of calcium carbonate (limestone), silica, alumina and small amounts of
other materials.
3. Burning limestone to make clinker produces cement, and the clinker is blended with
additives and then finely ground to produce different cement types.
Key Steps:
There are following five steps given as under
The raw materials needed to produce cement are:

1) Shale 2) Limestone
3) Bauxite 4) Gypsum
5) Iron ore

Step 1:

Extraction of raw materials

The raw materials are extracted from the quarry by digging the holes through machines in
mountains containing limestone and other resources needed to be used in process then
they do blasting.

Step 2:
Storage and blending of raw materials
Then all these raw materials are to be stored for the further process. Those raw materials
are then crushed and then blend with each other. Then these are transported to the plant
where they are stored forming piles through machines and homogenized.

Step 3:

Raw grinding and burning

After that there will be grinding in a careful mixture which produces a very fine powder
in a 2000 horse power roller mill, this fine powder is known as Raw Meal. Next, the
fine powders heated as it passes through the Pre-Heater Tower into a large kiln, which is
over half the length of a football field and 4.2 meters in diameter. In the kiln, the powder
is heated to 1500 degrees Celsius and cooled by bursts of air. Now this creates a new
product, called Clinker. And is just like small black soft stones. It is the basic requirement
for the production of all cements.

Step 4:

Cement grinding and storage

A small amount of gypsum (3-5%) is added to the clinker to regulate how the cement will
set. The mixture is then very finely ground in a finishing mill. The mill is a large
revolving cylinder containing 250 tons of steel balls that is driven by 4000 horse power
motor. Then "pure cement" is obtained and is so fine that it can pass through a sieve that
will hold water. During this phase, different mineral materials, called "cement additives",
may be added alongside the gypsum. Used in varying proportions, these additives, gives
the cement specific properties such as reduced permeability, greater resistance to sulfates
and aggressive environments, improved workability, or higher- quality finishes. Finally,
the cement is stored in silos before being packing and delivers to the sites.
Step 5:

Packing and delivering

After being stored in silos, there is a last phase of packing that cement and loading and
delivering that very fine cement to the sites where it requires.
The cement manufacturing process consists of many simultaneous and continuous
operations using some of the largest moving machinery in manufacturing. Over 5000
sensors and 50 computers allow the entire operation to be controlled by a couple of
Operators from a central control room. Each tone of cement requires about 1.7 tones of
limestone, gypsum and silica, etc. By volume limestone accounts for about 80% and clay
19% of the intermediate product clinker. Gypsum is later on added to clinker in the
ratio of 4:96 to obtain cement.

Flow Process of Production Cost of production since the industry faces a situation where

DECISION MAKING
The decision making style of D.G.K.C.C is decentralization. And the organizational
structure is flat. Although all the employees have opportunity to give the decisions
regarding the plant performance and for that also meetings are held every day between
DIRECTOR and MANAGERS of the company in which they also discuss and made
future plans of the daily routine work and they also check out their previous day work
efficiency and performance, every manager is responsible to give the performance report
of every employee working under him.

Top Management of DGKCC

Departmentalization
1. Director
2. GM(Work)
3. GM(Admin)
4. Head of Department
5. Requester

Purchase department
Purchasing process

Requisition
It is basically demand created by user department. If the worker of DGKCC needs any
item relating his task than he raise demand by giving this letter.

RFQ (Request for Quotation)

When purchase department see any requisition contact to suppliers is done. So that they
can give them proper idea about theirs items. That how much easily they can provide
these items to factory.
Quotation
This is basically response of suppliers against RFQ.

Comparative Statement
This is a comparison of all the quotations which are received from suppliers. In this
statement department see that which suppliers is providing items in least amount and in
reasonable time.

Requisition in favor of an approved suppliers

Purchase order will follow a predefined approval hierarchy to get approval.

Purchase order
After taking comparison a suppliers is suggested. And order is placed to supplier.

Receipt
User will enter receipt in the system on physical receipt of item on gate.

Human Resource Department

There are five practices of human resource.

Recruitment and Selection

There is a long process of recruitment and selection in GDKCC. First a vacancy add is
published in newspapers. Then interviews are conducted in Head office Lahore. A written
test is also a part of selection process. Then after a proper analysis a candidate is selected
for the job. Now, the HR department of DGKCC starts to maintain the record of
employee in a file.
Following documents are the parts of this record book.
Employee Academic Certificate
Curriculum Violet
Hand written application for recruitment
Company test
Employees Code of Conduct
Employee personal record form Appointment Latter
Medical fitness certificate
Registered AID (Security Clearance)
Orientation Program
Orientation Arrival
Probation Review Form
Review Form Conformation
Office Orders
Emails form Head Office
And in the case of retirement or death some other document also becomes the part of
record file. Such like Death Certificate, Clearance form etc.

Training and Development

With the advancement in technology, DGKCC also arrange different workshops and
training programs for employees. First the training of one year is necessary for new
recruitment of technical staff. With the advancement in Oracle Software, Company
provides employees opportunity to learn about oracle as they need. For this company
provides one week training to employees in head office.

Performance Appraisal
For this purpose an Annual Confidential Report (ACR) is prepared according the
performance of employee throughout year. On the basis of which different steps is taken
for employees future. A form is a part of this report which is called worker performance
appraisal form.
The sketch of data which is obtained with the help of this form is
Personal Data
Performance Evaluation
o Professional Knowledge
o Hard work and Dedication
o Work Standard
o Team Work
o Attitude and Behavior
o Attendance
o Honest and Loyal
o Obedient
o Personal Hygiene
o Courteously
Overall performance
Training (TNA)
Comments of G.M
This form is filled by the head of department of relevant employee.

Employees Relation
Company focused to maintained good relation with employees. For this purpose different
worker parties are working in DGKCC. These maintain a good relation between
employees and company .After the completion of a year, employees brings their
represented forward who try to solve the problems of workers. There is a system of
election for choosing the best representation of employees. Deductions are also done.
May be employee took any loan from company than the adjustment is passed for that
amount. It can be house building loan or any other loan. A lumsum amount in form of
Gratuity is also provided to employee. It is basically obtained by multiplying number of
year service with last basic salary. After retirement an Earned Leave fund is also
provided to employee. From the date of joining after probation period the amount is
deducted from the salary and provided every employee after his retirement in the form of
Provident Fund. Retirement Benefits On the time of retirement following adjustments
are maintained.

1. SWOT Analysis
SWOT stands for strengths, weaknesses, opportunities and threats. A SWOT analysis
is technique that many companies use during strategic planning; basically an organized
way to evaluate where to focus time, money and energy to improve productivity and
growth. A SWOT analysis can be a valuable tool for setting milestones or approaching
a venture investor, because it demonstrates a solid understanding of your company
performance and the factors influencing Productivity. Explanation of SWOT Analysis

STRENGTHS
Availability of raw material
Cheaper labor
Latest machinery
Quality Product
Self Power Generation
Durability
Competitive Edge
Profitable Organization
Use of Coal and Waste Products
Own Paper Bag Plant

WEAKNESESS
Low Promotional Campaign
No Performance Appraisal
Seniority Issues
Centralized Decision Making

OPPORTUNITIES
Location of Project
Export Demand
Introduction to New Product Line
Rehabilitation and New Construction Projects in Country

THREATS

Increase in Fuel Prices

Economic Recession
 Political Instability
IMF Loan
Increase in Interest Rates
Decrease profitability due to competition
High level of taxation

Recommendation
They should pay much attention to their employees promotion. They should use
performance appraisal system.
Top management should use up-to-date marketing practices rather to use orthodox ideas.
This is the age of advertisement and they should advertise their product rather use push
strategy. They should emphasize on pull strategy as well. They have good, energetic,
experienced marketing and sales team they should use it constructively.
They should pay much attention to promotional tools. They should advertise their
product.
They are only using trade promotions, which are not enough to have a good positioning
in the market. They should use other promotional tools as well.
The middle level management should be involved in decision-making. In this way they
will feel sense of responsibility and their productivity will increase. Their loyalty with the
organization will also increase.
They should also introduce some employee recognition program. In this way the
employees will be more satisfied with their jobs and ultimately will be beneficial for the
organization in terms of high productivity.
Skills and performance based performance appraisal program should be applied.
Employees should be promoted on the basis of their achievement. Employees should be
rotated in different jobs and tasks, as monotony decreases productivity.

References:
www.dgcement.com
Mr. Khalid Mehmood
Mr. Amir Noor
Mr. Kashif
Mr. Jawad