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Kousali Institute Of Management Studies

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Executive summery

Logistic comprises the entire inbound and outbound segments of the

manufacturing and service supply chains. The growth of retail industry has triggered

the growth of logistics in India. Entry of global players has developed stiff

competition among the players.

The Indian economy has witnessed fast-paced growth over the last decade, making it

one of the preferred investment destinations for multinational corporations and a recognized

manufacturing hub to the world. This, in turn, has resulted in increased demand for world-

class logistics and warehousing services in India, leading to the growth and transformation of

this sector. The logistics sector has been growing at an impressive rate of 8 to 10 per cent per

annum since 2002 to touch revenues of $100 billion in 2007 - 08. The World Bank's 2007

Global Logistics Report ranks India 39 amongst 150 countries in terms of logistics

performance during the year as well as its future potential. Further, the Indian logistics

industry is expected to grow annually at the rate of 15 to 20 per cent, reaching revenues of

approximately US $ 385 billion by 2015. The accelerated growth of the logistics industry,

coupled with an increasing trend to outsource warehousing activities, has made India a vast

and untapped market.

The increasing cost of fuel, infrastructure facilities and competition, less

margin. Have increased the more concentration on vehicle routing and scheduling.

Many research have been conducted on routing and scheduling from 80s and new

methods are developed frequently. After computers are developed new softwares aredeveloped for routing and scheduling.

VRL is organized logistic service provider in India; where as 90% of the other

players are unorganized. VRL is the one of the organization that is continuous

growing in present competition.


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Industrial Profile

Transportation:

Efficiently distributing freight and moving people has always been an

important factor for maintaining the cohesion of economic systems from empires to

modern nation states. With technological and economic developments, the means to

achieve such a goal have evolved considerably. The historical evolution of

transportation is very complex and is related to the spatial evolution of economic

systems. Transportation is a story of mens change and ingenuity in overcoming

obstacles, to conquer the land, seas and the air.

The Industrial Revolution and Transportation:

It was during industrial revolution that massive modifications of transport

systems occurred in two major phases. The first centered along the development of

canal systems and the second centered thermal energy into mechanical energy,

providing an important territorial expansion for maritime and railway transport

systems. Much of the credit of developing the first efficient steam engine in 1765 is

attributed to the British engineer Watt, although the first steam engine were used to

pump water out of mines. This marked a new era in the mechanization of land and

maritime transport system alike.

The main consequence of the industrial revolution was a specialization of

transportation services and the establishment of large distribution networks of raw

materials energy.

International transportation undertook an important phase of growth towards

the end the 19th century, especially with improvement in engine propulsion

technology and gradual shift from coal to oil in the 1980s.

Early self-propelled road vehicles were powered by steam, as electricity

opening the way for the modern automobile was the invention of the internal

combustion engine, fueled by gasoline, 1876. Within a few decades, automobile andother motor vehicles such as trucks and buses were everywhere. Highways were built


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and then improved to accommodate the ever-increasing number of vehicles. Gasoline

stations and other auxiliary services were established.

Land transportation is the effect since the invention of the internal combustion

engine has been marked by improved vehicle design and new applications of power.

Modifying the internal combustion engine to use of oil rather than gasoline produced

the diesel engine, which provides economical power for locomotive, large motor

vehicles and increasingly automobiles. Electricity is widely used to power railways

and rapid transit systems.

To meet the challenge of capacity expanding transportation needs, extensiveresearch and development projects have been undertaken. Planners are attempting to

develop a coordinated system of public and private transport. Their goal is to reduce

or eliminate many problems such as congestion, delay and air pollution that modern

man encounter in transporting himself, his family and his products over land.

Historical background

Right from the pre-historic times, trade has been the most significant

achievement that mankind has ever got par with and the conquest for excellence still

continues. This even gets justified when VRL look at the present day

structure of the world economy solely based on trade and commerce. The term

trade comes along with the supply and demand of the goods and commodities being

traded. To enable an increase in sphere of influence of the products, the

companies want their product to be available to their customers and also to

search for potential customers by exploring newer markets. This requires heavytransportation (selection of mode of transport depends upon the proximity of market

to be served and the financial constraints of the organization) and hence, the term

Logistics.

Logistics, as defined classically, is the time related positioning of goods,

has been in place ever since warfare existed between mankind. Tracing on the history

and evolution of logistics, it would be correct to say that Military logistics is the

predecessor of modern business logistics. Its in fact appropriate to take a field of


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military warfare into modern day business, as the competitive environment today is

no less fierce than the wars fought by mankind, let alone the weaponry. The

basic military strategy of protecting ones own supply while attacking those of an

enemy can be rephrased to suit modern day business as follows. The usage

Competitive advantage over rivals is very much in vogue in management

vocabulary. Various military practices have been adopted into commercial world to

gain this competitive advantage. The field of operations research also grew out of the

military logistics efforts of WWII.

Through the time, as the competition between firms increased, the

focus shifted to the details of the strategy as to provide the right item in the right

quantity at the right time at the right place for the right price to the right person (very

much the realization of 4 Ps of Marketing). This condition called for the

integration of information, transportation, inventory, warehousing, material handling

and packaging which further led to the need of highly efficient systems to attain these

goals. The branch of business logistics evolved in the 1950s. The reason for the

evolution being the need for supplying ones own business with the materials and

shipping out the products in a globalised supply chain. During 80s, there was

increased globalization and an increased use of IT. These trends resulted in increased

demands on firms and possibilities for companies to operate more competitive and

lean. It was during this time that many successful 3PL companies of today emerged.

Some of them are:

DHL/Exel, FedEX, Kuehne-Nagel, Schenker, UPS, Panalpina, C.H. Robinson, TNT Logistics, Schneider, Maersk Logistics NYK Logistics. VRL Logistic LTD


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Various modes of transportation and their characteristics India

Various modes of transportation and their characteristics

Advantages:

?Road network of 3.3million km is the secondlargest globally

?55% of total freight

movement is viaroadways

?Roads offer wide reachand easy accessibility toeven small markets

Disadvantages:

?High cost oftransportation

?National Highwaysaccount for only 2% ofthe total network butcarries 40% of total

freight

Key Developments:

?National HighwayDevelopment Project toupgrade and modernisehighways

?24,000 km of NationalHighways are to beupgraded to four/sixlanes. Connectivity toports is also being

improved?The following projects

are under development.- The Golden

Quadrilateral- North South Corridor- East West Corridor

Advantages:

?Spread over 81,500 km,railways carries 25% oftotal freight movement

?Low transportation cost

as compared to roads

Disadvantages:

?Bulk commoditiesaccount for 90% of totalfreight revenues

?Inflexibility to reach deepinteriors

Key Developments:

?Phase 1 of dedicatedfreight corridor alongGolden Quadrilateral tobe initiated in 2008-09

Advantages:

?Cheapest mode oftransportation

Disadvantages:

?Poor state of inlandwaterways in the country

?High turnover time

Key Developments:

?Cargo handling capacityof ports to be increasedfrom 600 million tones in2007 to 1500 milliontones by 2015

Advantages:

?Fastest mode oftransportation

Disadvantages:

?Low freight movement

?87% of total freight trafficbeing handled by airportsin metro cities

Key Developments:

?Modernisation of 37operational airports anddevelopment of newairports will increase aircargo handling capacity

Railways Water / Ports AirportsRoads


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Third party logistics

Third party logistics (3PL) or contract logistics is thus the supply chain

practice of outsourcing the various logistics functions of inbound freight, customs

consolidation, ware housing, distribution, and outbound freight to the

client's customers. The 3PL provider executes these logistics functions on behalf

of the client company by using own assets resources. This provides the service user

company to concentrate more on its core competences while at the same time

operating in a leaner fashion without owning many assets, thereby reducing the

overall operational costs. The resources and funds that would otherwise have been

utilized for the performance of the logistics functions can be now redirected towards

improving operational efficiency in other disciplines.

India is not aloof as well, when VRL talk about the utilization of 3rd Party

logistics by companies in India, it has been 55% when compared to the global index

of 71%. This further testifies the increasing role and understanding of

optimal business practices by the Indian firms. With the relaxation in government

policies and banking on the highly skilled and educated labor force, the

industries in India (specifically; Manufacturing and Services) are in the phase of

expansion and with globalization in its full fray, the companies here too are looking to

supply its products throughout the globe to increase its market presence and this

active participation in the world trade makes Indias position as inevitable in the 3PL

usage. Moreover, the rapidly growing Indian Consumer Market and the

increase in consumption expenditure has made the Indian customer sensitive

towards the quality and speed of the service being provided, due to which the

organizations are forced to go for3rdParty Logistics so that they can concentrate

on their competencies i.e. production by outsourcing the critical processes of the

Supply Chain to the experts thereby lowering their costs. DHL was the first company

to begin 3rdParty Airlift Cargo operations in India in the late 70s.


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3 PL Industry Overview:

The 3PL industry is a difficult to analyze for its volume and size. The global

logistics market generated total revenues of $804.6 billion in 2007, representing a

compound annual growth rate (CAGR) of 6.2% for the period spanning 2003-2007. In

comparison, the European and Asia-Pacific markets grew with CAGRs of 3.2% and

10.5%, respectively, over the same period, to reach respective values of $248.7 billion

and $272.3 billion in 2007. The retail logistics segment was the markets most

lucrative in 2007, generating total revenues of $514 billion, equivalent to 63.9% of

the market's overall value. Logistics for the automotive sector contributed revenues of

$105.8 billion in 2007, equating to 13.2% of the market's aggregate value. The

performance of the market is forecast to follow a similar pattern, with an anticipated

CAGR of 5.3% for the five-year period 2007-2012, which is expected to drive the

market to a value of $1,041 billion by the end of 2012. Comparatively, the European

and Asia-Pacific markets will grow with CAGRs of 0.6% and 9.7%, respectively,

over the same period, to reach respective values of $255.6 billion and $431.9 billion

in 2012. The market share of the Asia pacific is one third accounting to 33.8 % of the

total, with United States contributing the lion share with 35.2% and Europe 30.9% of

the total revenue generated.

Four Major 3PL Segments:

Non-asset based Domestic Transportation Management (TM):

3PLs providing value- added transportation management services dealing

with shipments originating in and destined to domestic locations. Services are usually

performed in conjunction with freight brokerage and are often contractual.

Non-asset based International Transportation Management (ITM):

3PLs providing value-added international transportation management services

dealing with shipments, and usually performed in conjunction with freight

forwarding, often contractual in nature.

Asset-based Dedicated Contract Carriage (DCC):

3PLs providing dedicated contract carriage services supplying tractors, drivers


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and management. Trailers are normally included; contract terms are 1-7 years.

Asset-based Value-Added Warehousing/Distribution (VAWD):

3PLs normally providing long term contract warehousing or distribution

centre operations with a host of value-adds

Types of 3PL Providers

3PL firms promote themselves as provider of a comprehensive range of

logistics services. It is useful to categorize them in one of the following ways:

Transportation Based:

The 3PL services provided by this type of firms are leveraged, in that way

they utilize the assets of other companies, and some are non-leveraged, where the

principal emphasis is on utilizing the transportation-based assets of the parent

organization. Basically, these firms extend beyond the transportation activity to a

more comprehensive set of logistics offerings. Few transportation-based

suppliers are Ryder, Menlo logistics, Schneider Logistics, FedEx Logistics and UPS

Logistics.

Warehouse/Distribution Based:

Traditionally, most Warehouse/Distribution based logistics suppliers have

been in the public or contract warehousing business and have expanded into

a broader range of logistics services. Based on their traditional orientation, these

firms are in Inventory Management, Warehousing, Distribution, etc. Examples of

such firms are DSC Logistics, USCO, and Excel, Caterpillar Logistics

Services, IBM.

Forwarder Based:

This category includes companies like Kuehne & Nagel, Fritz, C.H Robinson

and Hub Group. They have expanded their middleman roles as forwarders and/or

brokers into the broader range of 3PL services. Essentially, these firms are non-asset

owners, are very independent and deal with a wide variety of suppliers in logistics

services.


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functions and more of their strengths and leave the job of logistics on the 3PL

providers. Basically an organization is saved of the trouble of focusing on this aspect

and not spread their functions so wide.

Effectively reach their customers:

Providing finished products to actual customers can be hindered with many

problems from the organizational point of view. This is a affecting the organizations

around the globe. A 3PL services provider reduces this trouble of the

organizations. They take up this job of reaching the customers and delivering the

products on time and effectively.

Increased sales and market share:

With expansion in newer markets, organizations benefits a lot in increasing

their sales as well as their market share in the fiercely competitive global economy.

Thus 3PL services contribute a lot in the profitability of the organizations.

Flexibility in operations:

Access to 3PL services brings in a lot of flexibility in the overall operations of

the organizations. They take up an important part of their activities that helps in

improving their other important operations of the organization.


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Some Leading Global 3PL service providers

DHL

Adrian Dalsey, Larry Hillblom, and Robert Lynn founded DHL as a company

in 1969. The company is now a wholly owned subsidiary of Deutsche Post World

Net. The company offers expertise in express, air and ocean freight, overland

transport, contract logistics solutions as well as international mail services. DHL links

120,000 destinations in more than 220 countries and territories. The company

provides services from a network of about 6,500 offices, and it employs a fleet of

nearly 76,200 vehicles and about 420 aircraft. The company operates through

four major business divisions, namely the DHL express catering for

international business and personal courier services, DHL Freight and DHL Global

Forwarding catering to international air and ocean transportation as well as European

overland transportation. The DHL Exel Supplychain division caters for the contract

logistics Services and corporate information solutions. DHL Global mail division

provides for the mail and communication solutions and integrated solutions for the

corporate.

Federal Express:

FedEx provides transportation, e-commerce and business services.

The company offers integrated business applications through its operating

companies. The company's subsidiary, FedEx Express is the world's largest express

transportation company. FedEx has a host of services to cater to all segments starting

from the personal consumer to the complicated supply chain solutions for todays

global business environment.


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Company Profile

VRL LOGISTICS LIMITED

VRL Logistics Limited (VRL) was founded in 1976 by Vijay Sankeshwar,

Chairman, in Hubli-a small town in North Karnataka, the southern state in India, with

a single truck and a vision that was way ahead of its time. Starting its operations in

the General Cargo transportation, VRL has grown into a renowned, pan-India,

Logistics and Passenger Transport Company, which is currently the largest private

sector fleet owner in India, with a fleet strength of over 2800 vehicles, which is in the

Limca book of records.

Mr. Vijay Sankeshwar, the promoter commenced the business of

transportation in the state of Karnataka, as a proprietary concern in the year 1976. The

proprietary concern subsequently converted into a partnership firm by the name of

M/s Vijayanand Road lines in the year 1978. This partnership firm was then

converted into a private limited company under part IX of the Companies Act, 1956

under the name of Vijayanand Road lines Private Limited and a Certificate of

Incorporation dated March 31, 1983 was issued by the Registrar of Companies,

Bangalore, and Karnataka. The Company became a deemed public Limited Company

in the year 1994 and the Registrar of Companies, Bangalore, and Karnataka made an

endorsement to this effect on July 1, 1994, on the Original Certificate of

Incorporation dated March31, 1983. Pursuant to a special resolution passed by

the Shareholders in the Extraordinary General Meeting held on February 14, 1997 the

status of the Company was subsequently changed from a deemed public Limited

Company to a public limited company. The name of the Company was changed to

VRL Logistics Limited and the RoC Karnataka granted a fresh certificate of

incorporation, consequent on change of name, to the Company on August 25, 2006


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The Company was initially in the business of transportation of goods and

parcels, subsequently it commenced the business of courier service in the year 1992.

In the year 1996 the Company acquired passenger busses and entered into an

agreement with Vijayanand Travels a proprietary concern started by Mrs. Lalita

Sankeshwar in November 1996 for giving the said vehicles on hire, to carry on the

business of passenger service. Initially Vijayanand Travels was operating within the

state of Karnataka only. Over a period of time with the growth of its business, it

began operating busses betVRLen destination in Karnataka, Maharashtra and

Tamilnadu. The Company acquired the business of Vijayanand Travels on June 30,

2004 for a total consideration of Rs 50,00,000. Mrs. Vani Sankeshwar, wife of Mr.

Anand Sankeshwar in August 2001, started Maruti Parcel Carriers as a proprietary

concern. Taking vehicles on hire basis from the Company started this business. The

Company started Shiva Road lines in the year 2003 as a separate division. Shiva Road

lines provide service only in the state of Karnataka covering 6 cities. The Company

has recently diversified in the wind power business in September 2006 and air charter

business in 2007. Recently, company has purchased premier 1A aircraft from Hawker

Beech craft Incorporation, USA. Premier 1A is 2 pilots and 6 passenger seat aircraft

(with 4 club configuration seats). It has also entered into MOU dated November 1,

2007 with Indamer Company Private Limited for the maintenance of the aircraft.

Over the years VRL has evolved itself as providers of safe, reliable and timely

delivery network, in the field of parcel services. It has now expanded its operations

into Express Cargo to meet the growing demand for quicker and speedier deliveries

of parcels. Currently VRL handles over 6000 MT of parcels every day adding up to a

staggering 216,000,000 MT of cargo per annum. Apart from its core business ofCargo Transportation, the company has diversified into Passenger Transportation.

Today VRL is one of the leading companys in the Indian Surface Transport Industry.

In 2007, VRL Logistics Ltd. paved its way into the Indian Aviation Industry.

It is a gradual progression for the company, from Surface Transport to Air

Transport. The Indian Aviation Industry has experienced a tremendous growth in the

last two years, more so in the Private Aviation Sector. Keeping in mind the market


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demand VRL decided to enter the Air-charter Industry and serve the VVIP, VIP &

Corporate India.

In the first phase, VRL has acquired a brand new, Premier Jet 1A aircraft,

manufactured by Hawker Beech craft Corporation, USA. The company has future

expansion plans to add more aircraft and helicopters, based on the market feedback

and demand. Initially VRL wish to offer the Jet aircraft on charter basis to the

corporate sector, Leisure and Tourism sector, Medical Evacuation, Special Mission

charter, Event Management, Advertisement Agencies and VIP flights.

The Business:

VRL is into the business of transportation and logistics service of goods and

transportation of passengers by road. VRL have a long operating track record of more

than two decades in this business. The chairman Mr. Vijay Sankeshwar has over three

decades of experience in the transportation industry. It has also recently forayed into

wind power generation and air charter business. It offers following services which are

summarized below -

1. Goods Transportation

a. Full truck Load

b. Less than full truck Load (Parcel)

General Parcel

Express Cargo

c. Courier

d. Passenger Travels

2. Wind Power Generation

3. Air Charter Business


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The Goods Transportationand distribution business is carried across 17 states

and 7 Union Territories i.e. Pondicherry, Daman, Silvassa, Chandigarh, Karaikal,

Yanam, Mahe covering 649 cities through out India. It covers the states of Karnataka,

Andhra Pradesh, Tamilnadu, Kerala, Maharashtra, Goa, Gujarat, Rajasthan, Punjab,

Haryana, Delhi, Himachal Pradesh, Uttar Pradesh, Chhattisgarh, Madhya Pradesh,

west Bengal (Kolkatta) and Uttarakhand under this business. The passenger transport

business is carried on under the name of Vijayanand Travels. VRL carry on this

business within the state of Karnataka, Maharashtra and Tamilnadu covering 56 cities

in all. It has 40 branches and 466 franchisees across the states of Karnataka,

Maharashtra and Tamilnadu for the passenger transport business. Its fleet strength as

on February 29, 2008 comprises of 2,683 vehicles, all of which are owned by the

Company. Its fleet comprises of 2,446 vehicles for goods transportation, 197 vehicles

for passenger travels and 40 vehicles for internal use which includes fork lifts, cranes,

staff buses, water tankers, diesel tanker, tractors etc. The Companys network of

Transshipments/branches/offices for the goods transport business covers 17 states and

7 Union Territories in India. It has its Head Office at Varur, Corporate Office at

Hubli, 5 Administrative Offices, 43 transshipments hubs, 799 owned branches and

1387 franchisees, which enables the smooth flow of goods and services. It also

possesses key in-house competencies in body designing for trucks, vehicle repair and

maintenance. It also has a dedicated research and development unit and a software

development center, which enables us in cutting, cost and increase vehicle efficiency

and performance.

In September 2006, it commenced the wind energy business in southern India

at Kappatgudda, Gadag district in the state of Karnataka. It had issued various purchase and work orders to various Suzlon entities for the supply, commissioning

and erection of 34 Wind Turbine Generators (WTGs). It has also entered into power

purchase agreements with Hubli Electricity Supply Company Limited (HESCOM),

for sale of entire power generated by it.


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Vision and Mission:

Vision:

To become the premier company that cuts accross various segments and

emerges as the torchbearer of each segment that the Group ventures into.

Mission:

To provide the highest quality service to our customers by continuously

increasing cost efficiency and maintaining delivery deadlines. To encourage

our employees / workforce to strive for quality & excellence in everything

they do. To promote teamwork and create a work environment that takes care

of talent and brings out the best in our employees.

Corporate Social Responsibility:

Our corporate integrity is a critical asset and we are committed to upholding it

in everything we do. We share our expectations and opinions and strive to maintain a

workplace built on mutual values, trust and goodwill & we continue to embed theseethical standards in our business environment. Noteworthy is the Vignyan Yog Shivir

that we organized that was conducted by Param Pujya Ramdevji Maharaj which was

attended by more than 10,000 people across the state.


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OBJECTIVES

1. To carry on the business of the public carriers, transporters and carriers ofgoods, passengers, merchandise, commodities and luggage of all kinds of

descriptions in any part of India and/or abroad, on land, water or rail and air

by any means of conveyance whatsoever, in its own name or as a agent.

2. To undertake and carry on the business of loading and unloading forwardingand clearing agents, warehousemen, macadams and care men for and on

behalf of owners of goods, luggage, parcels, materials, articles, commodities,

life-stock & other movables of all kinds and descriptions.

3. To generate electrical power by non-conventional, conventional by utilizingwind, thermal, solar, hydel, geo-hydel, tidal waves, bio-mass fuels, coal, gas,

lignite, diesel, oil, waste or any other source of energy and for the purpose

established co-generation power plants, energy conservation projects, power

houses, transmission and distribution systems for generation, distribution,

transmission and supply of electrical power, energy to the state electricity

board, state government, appropriate authorities, license specific industrial

units and other consumers for industrial, commercial, agricultural, household

and any other purpose in India and elsewhere in any area to be specified by the

state government, central government, local authority, state electricity boards

and any other competent authority in accordance with the provisions of Indian

Electricity Act, 1910 and/or Electricity Supply Act, 1948 or any other

modifications or re-enactment thereof and rules made were under; and to

undertake trading of Certified Emission Reduction as part of Clean

Development Mechanism in connection with generation of electrical power.4. To act as agents, representatives, surveyors, sub-insurance agents, franchisors,

consultants, advisors, collaborators, in life and general insurance in all its

branches and manifestations.


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Board of Directors

Name, Designation, Occupation Age Address

Mr. Vijay Sankeshwar

Chairman and Managing Director

Business

56 House No. 120 to 125, Lalith Mahal,

Naveen Park, Kusugal Road, Hubli

580 023

Mr. Anand Sankeshwar

Managing Director

Business

32 House No. 120 to 125, Lalith Mahal,

Naveen Park, Kusugal Road, Hubli

580 023

Mr. Sudhir Ghate

Independent Director

Business

49 Needam, Behind SDM College

M.G. Road, Mangalore 575 003

Mr. C. Karunakara Shetty


Business

53 Bhagavathi, No. 100, 1st Cross,

Sharadha Colony, Basaveshwara

Nagar, Bangalore 560 079

Mr. Mallesh BudihalIndependent Director

Business

57 No. 12, 2nd Cross, Sripuram, KumaraPark (VRLst), Bangalore 560 020

Mr. R.S Hugar


Professional

67 Pitambar, Kalyan Nagar

10th Cross, University Road

Dharwad - 580 007

Karnataka

Mr. Suresh Angadi


Business

52 Sampige Road VishVRLshwar Nagar

Belgaum -

590 001Karnataka


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Brief Biographies of the Directors:

Mr. Vijay Sankeshwar:

The Chairman and Managing Director, is also the Promoter of the Company.

He holds a bachelors degree in commerce from Karnataka University, Dharwad. He

was a former Member of Parliament and was elected from the Dharwad (North)

constituency in the 11th, 12th and 13th Lok Sabha elections. He was member of the

Committee of Finance for the year 1996-97, the Consultative Committee, Ministry of

Surface Transport in the years 1996-97, 1 998-99 and 1999-2000, the Committee of

Transport and Tourism in the years 1998-99 and 1999-2000. He has over 30 years ofexperience in the transport industry and 7 years of experience in the media industry.

He has received various awards including the Udyog Ratna in the year 1994 by the

Institute of Economic Studies, New Delhi, Aaryabhat Award in 2002 and Sir M.

Vishweshvarya Memorial Award in 2007. He started the Company in the year 1976

as a proprietary concern. He is actively involved in day-to-day affairs of the

Company.

Mr. Anand Sankeshwar:

The Managing Director is also the Promoter of the Company. He holds a

Bachelors degree in commerce from Karnataka University, Dharwad. He has an

overall experience of 15 years in the transport industry including 7 years of

experience in the media industry. He has also been awarded the Youth Icon award in

the year 2004 by Annual Business Communicators of India and Marketing

Professional of the year in the year 2005 by the Indira Group of Companies. Heheads the marketing department and is actively involved in day-to-day affairs of the

Company.

Mr. Sudhir Ghate:

The Director holds a bachelors degree in commerce from Mysore University

and he is also a fellow member of the ICAI. He was a partner in M/s Ganesh and

Sudhir, Chartered Accountants, Mangalore from 1982 to 1994. He is a Managing


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Director in M/s Magnum Intergrafiks private limited a national advertising design and

communication company accredited with Indian News paper Society, a member of

Audit Bureau of Circulation and Advertising Agency Association of India. He was a

member of National Council of Textiles Design, New Delhi from 2002 to 2004 and he

is National Executive Committee member of Advertising Agency Association of

India since, 2004. He has been on the Board Since June 15, 2005.

Mr. C. Karunakara Shetty:

The Director holds a post graduation degree in commerce from Karnataka

University, Dharwad and he is also a Certified Associate member of Indian Instituteof Banking (C.A. IIB). He was employed with Vijaya Bank from 1974 to 1998. He

has over 20 years of experience in the banking industry. Currently, he is the managing

director of Bhagavathi Chits Private Limited, which is also a member of Bangalore

Stock Exchange. He has been on the Board since June 15, 2005.

Mr. Mallesh Budihal:

The Director holds a bachelors degree in Arts from Karnataka University,

Dharwad and masters degree in Arts (Political Science) from Karnataka University,

Dharwad. He has over 30 years of experience in paper and board, packing paper and

offset printing industry. Currently, he is the managing director of Girish Paper

Packaging Private Limited. He has been on the Board since February 24, 2007.

Mr. R.S Hugar,

The Director holds a postgraduate degree in econometrics from Pune

University. He was Chairman and Managing Director of Corporation Bank from April

1997 to May 2000. He was decorated with many meritorious awards such as Best

Finance Man of the Year 1998-99 by National Foundation of Indian Engineers, New

Delhi under the aegis of Ministry of Heavy Industry for outstanding performance in

banking sector and charismatic leadership qualities and Lifetime Achievement Award

by National and International Compendium, New Delhi for exception caliber and


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outstanding performance in the chosen area of activity. He has been on the Board

since May 28, 2007.

Mr. Suresh Angadi:

He is a commerce graduate and law graduate from Karnataka University,

Dharwad. He has business association with the BK Birla Group and was responsible

for sales promotion of Vasavadatta Cement for the last two decades and has been in

real estate business and has promoted Sri Laxmi complex (Commercial Complex) at

Belgaum and Shradda residency (residential complex) at Belgaum. He is also the

Member of Parliament from the Belgaum constituency. He has been on Board since

July 28, 2007.


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Vijay SankeshwarChairman & Managing Director

Organization Structure

Anand SankeshwarManaging Director

Anjan RaoVP

G. S. AyyerVP

V. V.Karmadi

L. R. BhatCTO

K. N. UmeshCEODirector

(Finance)

D. N.Kulkarni

VP

SunilNalavadi

Chief

S. L.Nagaraj

Chief

S. R. Hatti

GM(Administration

Y. M. Hannalli

GM(Infrastructure)

C. M. Baluthi

GM (MPC)

Prabhu Salageri

GM (Travels)

S. G. Patil

GM (HRD)


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COMPANY OPERATIONS

VRL Logistics Limited

Transport and Logistics Air Charter OperationsWind Power Generation

Goods TransportationPassenger Travels

Vijayanand Travels

CtheierLess than Full Truck Load

(Parcel)Full Truck Load

Maruti Parcel

Carriers

General Parcel Shiva Road

lines

Express Cargo

AirRailRoad


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Total Number of Employees:

Sl.Number

Division Strength as on February 29

th

, 2009

Managerial Non-managerial Total

1 Corporate 12 56 17 - 1 86

2 Administrative

office

38 592 2 - 1 633

3 TPTs 120 1044 5142 769 21 7096

4 Branches 333 2231 358 543 65 3530

5 Workshop 32 160 - - 395 587

Total 535 4083 5519 1312 483 11932


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Departmental Structure

Legal Department

Complaint Department

Maintenance Department

Account Department

Personnel Department

Commission Department

Booking Department

Transshipment Department


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LEGAL DEPARTMENT

Legal department is a one which prominent part in the company. It focuses on

all the legal aspects concerned to the company. It functions positively towards the

success of the YRL group of companies. It is managed by an advocate and a legal

advisor of VRL group Mr. R. B. Gadagkar.

Its functional activities are:

Settlement of industrial disputes:Industrial disputes include strikes, lockouts, etc, and settled under Industrial

disputes act. Thus settlement of those disputes is one of the activities

concerned with trade unions.

Settlement of workmen compensation:This compensation, under workmen compensation act include accidents,

matters related to gratuity, pension Etc, are settled, prided accidents to

employees on job.

Settlement of accidents claims:In case of accidents or losses to the vehicles of VRL group of companies

occurs, then compensation can be claimed by this department.

To avoid illegal activities in the firm:Illegal activities such as theft, robbery within the premise are avoided. Thus

this department is created.

Advice department in the firmThis legal department acts as an adviser for the different departments of the

firm concerning with the ethics, social obligations towards the public.


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Suit against debtors:Customers are given maximum period to clear the debt, if the positive

response is not given first notice is send. That is within 30 days & second

notice within 90 days & third notice within 120 days & thereafter notices are

not sent but personnel approach is given and then legal action is imposed.

These notices are issued in order to avoid litigations, enmity.

Suit against bounced cheque:Customers paying by cheque and if returned by banks when there is enough

money in an account for it to be paid then the company has right to sue the

customer for such as act.

Settle legal charges:It is the responsibility of this department to pay all legal charges charged by

the court/government.

COMPLAINT DEPARTMENT

Here is a department to handle and settle the customer complaints. This

department takes care of customers to keep up their interest in the companys service.

Problems of customers will be handled efficient and settled properly up to their

satisfaction.

Complaints settled by this department are:

o Delays:Delay caused in delivering of materials to destination point. Delay due to

delivers negligence, inconvenience etc.


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o Settlement:When the customer complaints about delay in delivery of goods with LR

number, enquiry will be made from destination point about the undelivered

goods. And the corrected date of delivery will be given. If any loss is caused

to customer due to delay, such loss is compensated based on value of goods.

o Exchange of materials:This is one complaint that customer may complain. Sometimes the consigner

may misplace the goods unknowingly. So the customer is not in a position to

receive the goods. Therefore the above complaint is placed.

o Settlement:The company takes back the goods from wrongly delivered consignee and

redelivers to the right consignee.

o Road robberies, fire, theft etc:The goods are undelivered to the destination point due to robberies, fire, theft

etc.

o Settlement:

If the goods are lost during transit, short certificate wil be issued to customeruntil the gods are trace, loss is compensated on the basis of value of goods on

certain conditions.

MAINTENANCE DEPARTMENT

It means maintenance of various vehicles, which includes bus, lorry and other

goods carriers. At present there are 1700 vehicles, which include Volvo buses, luxury

buses, lorry, mini buses, etc. Mr. Bapu heads it.


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Functions:

o Centralized purchasingo Repairing the vehicleso Complete bodybuilding of vehicles.o Changing of oil, clutches as per the schedule for precautionso Hiring the lorries on the basis of locality and demando Maintenance of drivers accounts i.e. payment of salary to drivers looking after

there performance, appointments of new drivers etc.

ACCOUNT DEPARTMENT

Significant in accounting policies:

Basis of preparations of financial statement:The financial statements are prepared on the historical cost convention basis in

accordance with the generally accepted accounting principles and accounting

standards referred to in section 211(3c) of the companies act 1956 except

otherwise stated.

Revenue recognition:The company generally follows Mercantile System of accounting except on

claims, which is accounted on cash basis.

Fixed assets:These are stated at cost of acquisition construction except in certain fixed

assets, which have been revalued, less depreciation. All cost relating to the

acquisitions and installation of fixed assets are capitalized and include

borrowing cost the asset is put to use.


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Deprecation:Deprecation on fixed assets has been provided on straight-line method at the

to the rates prescribed in schedule XIV to the companies act 1956.

Foreign currency transaction:The company has not made any foreign currency transactions during the year.

Borrowing cost:

It is directly attributable to the acquisition or construction of qualifying fixedassets are capitalized as part of the cost of the assets, up to the date the assets

is put to use. Other borrowing costs are charged to the Profit and Loss

Account in the year in which they are incurred.

Retirement benefits:1. Contribution to provident fund/employee pension scheme and

superannuation funds are accounted on accrual basis.

2. In the year 2001-2002 the company has withdrawn the GratuityScheme under the LIC group Gratuity scheme. The company has

determined that the gratuity liability will be met out of the funds of the

company on cash basis.

Taxation:1. Provision for current tax is made and retained in the accounts on the

basis of estimated tax liability as per the applicable provisions ofincome tax act 19961 and considering assessment order and decisions

of appellate authorities in companys case.

2. The company calculated deferred tax assets/liability as prescribed inAS-22. Accounting for the taxes on income issued by the institute

of Charted Accountants of India.


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