PEL Research Project

Pak Elektron Limited: Change Your Life
Research Project
Instructor:
Mr. Faran Ali
Project Name:
Pak Elektron Limited (PEL)
Program:
BBA (HONS)
Group Leader:
Khawar Abbas ID # BBA-F15-46
Group Members:
Ahsan Ashfaq ID # BBA-F15-22
Anas Abdur Rehman ID # BBA-F15-30
Hamza Khalid ID # BBA-F15-39
Hasnat Tariq ID # BBA-F15-41
Junaid Ur Rehman ID # BBA-F15-45
Submission Date:
29 May, 2019
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“We dedicate our Research Project to all the researchers of the world who are busy in the
creation of knowledge for others.”
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ACKNOWLEDMENT
First of all, our gratitude to All-Mighty ALLAH who gave us the energy, the motivation
and the wisdom to accomplish this project.
Secondly we would like to thank our Resource Person Mr. Faran Ali as well as our
Principal Dr. Mohammad Arshad who gave us the golden opportunity to do this research
project to explore, and polish our skills. At this stage, it was a great learning opportunity for us
to understand and analyse a well-known company Pakistan Elecktron Limited (PEL).
We would also like to thank the HR executives of Pakistan Elecktron Limited (PEL) Mrs.
Sheza Saeed, Tayyiba Rafique and Head of Human Resources Mr.Kamaran Ali for
providing us with the required information and for giving us their precious time.
Lastly we (all the group members) would like to thank each other for our help and
expensive time put into this project. Furthermore we thank each other for cooperating with
each other in the completion of this project within the limited time frame.
If we have forgotten someone in the acknowledgment then we are deeply sorry and would
like to say that we appreciate their efforts as well.
Thanks & Best Regards!
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Executive Summary
Pak Electrons Limited (PEL) is the flag bearer of the Saigol Group of Companies. The products
manufactured by PEL has always been of a high standard, and the name 'PEL' is synonymous
with QUALITY all over Pakistan. Since its inception, the company has been working for the
advancement and development of engineering know-how in Pakistan. The company has
produced hundreds of engineers, skilled workers, and technicians through its apprenticeship
schemes & training programs.
The company comprises of two divisions:
 Appliances Division: This Division of PEL consists of home appliances manufacturing
Refrigerators particularly. Air Conditioners, Deep Freezers, Microwave Ovens,
Washing Machines and Water Dispensers
 Power Division: PEL Power Division is one of the major electrical equipment suppliers
to WAPDA & KESC. It includes Distribution Transformers, Power Transformers, Energy
Meters, Switchgears, Grid Stations, and EPC Contracting.
In 1956, the Saigol Group of Companies purchased major shares of PAK Elektron Limited.
At this junction, the company was only manufacturing transformers and switchgears. With the
Saigols in management, PEL expanded into Refrigerators & Air Conditioner manufacturing
and now it has become a Giant in the World of Appliances.
PEL has long been known in Pakistan as a company that produces quality products. PEL has
created brand loyalty among its users, and the company credits that to its high quality and vast
product range. PEL has been continuously adding new products to its range. As a result, PEL
has registered a significant increase in its sales volume during the last ten years.
One sector in Pakistan that has grown considerably in the past is the Home Appliances
Division. There is a high competition in this sector and PEL has survived this competition with
great flair. PEL enjoys a good reputation in the market for its home appliances.
PEL is in a growth phase in this sector. This sector carries a lot of potentials, and PEL can
capitalize on this fact.
Our stay at PEL was very beneficial since we got the opportunity to learn the trends in the
market in this sector. The company takes it as a liability to take care of its employees. The
corporate culture at PEL was very healthy and induced work habits. This atmosphere helped
us in building self-confidence and belief. At PEL, we had an opportunity to deal directly with
the customers and find out their demands and problems associated with PEL. We got to know
about the trend in the industry and also conducted research through which we got a better
understanding of consumer buying behaviour.
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We also got a chance to improve our decision-making skills. Furthermore, working at PEL also
helped us in becoming a better time-managed person. We got to know the importance of
teamwork in the workplace.
In the end, all the experience that we have gained during our stay at PEL has helped us a lot in
becoming a better-organized person and will help us in becoming an even better person in the
future. We can say this without a doubt that the values that we have gained while our stay at
PEL will be applied to wherever we go to work in the future.
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Contents
1. Brief Introduction of Industry .................................................................
2. Industry Analysis ......................................................................................08
3. Overview of Organization
a. Brief History of PEL ............................................................................10
b. Mission ................................................................................................11
c. Vision ..................................................................................................11
d. Objectives ............................................................................................13
e. Market Standing ..................................................................................13
f. Policy of the Organization....................................................................13
g. Competitators ......................................................................................14
h. Business Volume .................................................................................14
i. Product Lines ........................................................................................15
4. Organizational Structure of PEL

a. Organizational Hierarchy Chart ............................................................16
b. Number of Employes ...........................................................................18
c. Main Offices ........................................................................................18
d. Brief Introduction of All Departments ..................................................18
e. Comments on the Organizational Structure ..........................................21
5. Marketing Functions and Departmental Work
a. Marketing Department Hierarchy .........................................................21

b. Number of Employees Working under Marketing Dept ........................22
Briefly discuss about the 4P’s of PEL
c. Products/ Services Offered ...................................................................22

d. Pricing Stratigies ..................................................................................23
e. Distribution Channels ..........................................................................24
f. Promotion ............................................................................................25
6. Human Resource Manageent and Departmental Work

a. HR Departmetn Hierarchy ...................................................................26
b. Number of Employees Working under HR Dept ...................................26
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Briefly discuss about the HR practices of the PEL
a. Empolyes Recruitment and Selection ..........................................................27

b. Training and Development .........................................................................28
c. Performance Management ..........................................................................28
d. Compensation Policy ..................................................................................28
7. Critical Analysis
Marketing
Detail Analysis of marketing functions at PEL
a. Analysis of micro environment of PEL ........................................................29

b. Analysis of macro environment of PEL........................................................30
c. Cometitor analysis ......................................................................................32
d. STP OF PEL ..............................................................................................32
8. SWOT Analysis of PEL ............................................................................35
Human Resource Management
Detail analysis of HR Functions at PEL
a. HRM Planning ..........................................................................................42

b. Job Analysis ..............................................................................................44
c. Recruitment ...............................................................................................45
d. Training and Development .........................................................................49
e. Orintation .................................................................................................50
f. Appriaing and Managing Performance .......................................................54
g. Compensation and Benefits ........................................................................58
Finance
Detail Analysis of Finance Fuction at PEL
a. Finance Department Hierarchy. ..................................................................63

b. Number of Employees Working under Finance Dept. .................................63
c. Sub Department of Finance Department .....................................................63
d. Financial analysis (Detailed ratios analysis, Horizontel analysis, Vertical analysis of
PEL ) and Interpretations ...........................................................................63
e. Competitative Analysis with other Organization in same Industry ..............81
f. Future prospects of the PEL .......................................................................84
9. Recommendations ....................................................................................85
10. Conclusion ................................................................................................86
11. Refrences ..................................................................................................87
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Industry Analysis
Pakistan cables and electronic goods industry cover 3.5% in large -scale manufacturing index
(LSM INDEX). Pakistan’s consumer electronics market is expected to grow by an annualized
average of about 13.3% or $3.3 billion (460.55 PKR billion) by 2016, according to a newly
released report by the London-based research firm Business Monitor International. The cables
and electronic goods, defined as including computing devices, mobile handsets, home
appliance and audio/visual products such as television sets, is projected to be worth about $2
billion in 2012. This is expected to increase to US$3.3bn by 2016, driven by a rising population
and growing affordability.
The audio/visual devices segment accounted for about 36% of Pakistan’s cable and electronic
industry. As per Euro monitor, in 2016, mere 55% of households had a washing machine, 43%
had a refrigerator, 20% had a microwave oven, and 16% had a deep freezer. Product sale of
this industry have affected by trends. For example refrigerator, air condition, and deep freezer
sale higher in summer and sale affected in winter. Room heaters, water heaters and washing
dryers have high sale volume or demand in winter.
In this sector we have selected Pak Elektron Limited (PEL) Company. The major player in this
sector are Dawlance, Haier, Waves, Siemens, Microtech and Pakistan Elektron Limited (PEL).
PEL have two type of direct competitors according to their product classification. PEL’s direct
competitors in Appliance division are Dawlance, Haier, Orient and Waves. In Power division
their competitors are Siemens, Transfopower, Microtech, Alstom Grid Pakistan. In the power
division PEL has a market share of 42 percent followed by Siemens at 34 percent. In home
appliance, Dawlance leads the market with nearly 50 percent market share, followed by PEL
at 29 percent.
Several government regulation and current economic situation of the Pakistan has a great
impact on this sector. Like FBR allow to import use TVs and electronic goods in Pakistan it is
a threat for the electronic industry. Another affect is to increase in inflation. The prices of raw
material and labor rising day by day due to the inflation and obviously the cost of production
increases. And other impact is Pakistan currency going cheaper against dollar cause of this raw
material prices increase which we import. The political condition of Pakistan is highly
uncertain and unstable but from few years we have seen some consistency in Government
policies which encourage the foreign investors to invest in Pakistan.
Electronics industry highly effected by consumer taste for example in these days people use
mostly LED TVs if a firm produces LSD TVs their products are not accepted by the market
because in the market have more advance products consumer have use these things and move
on advance things their taste is change. In electrical goods industry, the innovation in
technology or technological advancement is the only factor that can affect the consumer taste
or preferences. If you are more advance you get more customer attention.
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This industry also effect by demographic trend for example air conditioner have higher
consumption in urban areas as compare to ruler areas. On the other hand this industry mostly
target middle and upper class. Lower income class, are not able to buy the electrical goods like
AC, Refrigerator, Microwave oven etc. Smart electronic devices, green electronic
manufacturing and energy efficient products these are some technological trends that affect
this industry.
For the competition this industry has taken following steps. First, having internationally
compatible products. Second, Capacity to manufacture and assemble products. Third , Remote
control feature, Affordable, Warranted products and to take care of customer appliances all
service centers have latest tools, equipment’s and machineries. This industry is highly effected
by season.
In this industry have some product their sale higher in summer like air conditioner, refrigerator
and fans some other have higher sale in winter like heaters, dryer machines and water heaters.
Some products have stable sale whole year like TVs, water purifier, washing machine and air
purifiers. Economic cycles also affect the this industry for example if country economic
condition going toward peak people generate more income and their purchasing power higher
they spent more money on these things. If country economic condition going toward recession
people have weak buying power they only fulfil the basic necessities. This economic condition
decrease the industry sale.
Some barriers to enter this industry. High cost of production is one of the main barrier of
entering the Cable and Electrical goods industry. The huge advertisement cost. The faraway
Break Even point as it will take time to set an image in the eyes of consumers and sell them
their product. Establishing dealership network. High costs of raw materials and other inputs
(costly electricity and custom duties on imports of the said units or raw material) and research
and development. High taxes in this sector. Government laws like Electricity Safety, Quality
& Continuity Regulations 2009 (ESQCR), Electricity At Work Regulations 1989 (EAWR),
and many others. This industry affected by the performance of other industries. If banks,
telecommunication, transport, oil and gas, not performing well also effect on the industry sale
and production.
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Overview of Pak Elektron Limited

Brief History of PEL
Pak Electron Ltd. (PEL) was established in 1956 with the technical collaboration of M/S AEG
Germany and is the oldest composite electrical equipment manufacturing unit in Pakistan.
In October 1978 the company was taken over by the SAIGOL GROUP, which is one of the
leading industrial and commercial groups of Pakistan. The Saigols migrated from Calcutta and
initiated their business in Lyallpur (later named to as Faisalabad), the textile city of Pakistan,
under the banner of Kohinoor Industries Limited.
The products manufactured by PEL have always been of a high standard and the name “PEL
is synonymous with quality all over Pakistan.” PEL, since its inception, has been acting as an
institution working for the advancement and development of engineering and modern
technology in Pakistan but also have a great wattage in the foreign industries. PEL products
are reorganized as the quality and valuable products in whole world. Its inspection tells that
they from its day of establishment till now have been made a great development in different
products by using advance technology.
Since its inception, the company has been working for the advancement and development of
engineering know-how in Pakistan. The company has produced hundreds of engineers and
skilled workers and technicians through its apprenticeship schemes & training programs. PEL
has been continuously adding new products to its range. As a result, PEL has registered a
significant increase in its sales volume, during the last ten years
In 1978, the Saigol Group of Companies purchased major shares of Pak Electron Limited. At
that juncture, the company was only manufacturing transformers and switchgears. With the
Saigols in management, PEL started expanding its product range by entering into Air
Conditioner manufacturing.
In 1981, PEL window type air conditioners were introduced in technical collaboration with
General Corporation of Japan.
In 1986-87, the company started manufacturing of refrigerators in technical collaboration with
M/s IAR-SILTAL of Italy.
In 1987, PEL deep freezers were also introduced in technical collaboration with M/s Ariston
of Italy.
In 2006, the Company has started manufacturing of split type air conditioners of various
capacities as the customer choice has shifted from window type to split type. The product has
been well received in the market. This encourages the company to multiply its production in
the coming year.
Today, PEL has become a household name. Its products are not only in great demand in the
local market but the Company has started exporting its appliances and power division products.
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Vision
To excel in providing engineering goods and services through continuous improvement.
Mission Statement
To provide quality products and services to the complete satisfaction of our customers and
maximize returns for all stakeholders through optimal use of resources. To promote good
governance, corporate values and safe working environment with strong sense of social
responsibility.
Introduction
PEL is the pioneer manufacturer of electrical goods in Pakistan. In 1956, the Company was set
up by Malik Brothers in technical collaboration with M/s AEG of Germany (“AEG”) to
manufacture transformers, switchgear and electric motors. AEG exited from the venture and
sold their share of PEL to the Malik Brothers in the late 1960s, which was subsequently
acquired by the Saigol Group of Companies in 1978. Since its inception, the Company has
always been contributing towards the advancement and development of the engineering sector
in Pakistan by introducing a range of quality electrical equipment, home appliances and by
producing hundreds of engineers, skilled workers and technicians through its apprenticeship
schemes and training programmes. Until the acquisition by the Saigol Group, PEL was solely
catering the power equipment market. The Company ventured into home appliances market in
1981 after acquisition. The Company comprises of two divisions; each offering a wide range
of products as follows:
Power Division
The most powerful revenue generating business unit of PAK Elektron, produces Transformers,
Switchgears and Energy Meters for the public sector such as KESC Karachi Electric Supply
Corporation, LESCO and PESCO. They provide these three products:
Production Transformers
PEL has vast experience in design and manufacturing of standard and special purpose
transformers up to 33kV and up to 6000kVA ratings.
PEL’s transformers have been successfully type tested for Impulse voltage and short circuit
tests at KEMA, (Holland), HV&SC Lab, Rawat (Pakistan), NIP (Pakistan) and UET (Pakistan).
Production Energy Meters
Another successful and most powerful department of power division is its energy meter
production department that manufactures Electro-mechanical Energy Meters under license
from ABB-USA. The quality of PEL meters has been certified by KEMA Laboratories
(Holland) and conforms to IEC 521, SGS Yarsley, and U.K, has certified PEL Energy Meter
plant for ISO 9002.
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Power Transformers
Owing to massive growth in power sector, demand for power transformers is also growing
proportionately for all ratings from 66KV to500 KV. PEL has stepped into this activity by
starting the manufacturing of 132 KV transformers, being the most demanded rating, and for
these purposes has formed a strategies partnership by signing the two agreements. Based on
the demand forecast of Power Transformers for WAPDA, KESC and other projects, PEL’s
market share is initially targeted to be 20%, growing in five years.
Appliances Division
PEL’s Appliances Division is the flag carrier of the Saigol Group involved in home appliances
manufacturing.
PEL Air Conditioners

PEL window-type air conditioners were introduced in 1981 in technical collaboration with
General Corporation of Japan. Ever since their launch, PEL air conditioners have a leading
position in the market. Recognizing the shift in consumers' preference from window-type to
split-type air conditioners, PEL has focused its manufacturing efforts on split-type air
conditioners.
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PEL Refrigerators
The manufacturing of refrigerators started in 1986-87 in technical collaboration with M/s IAR-
SILTAL of Italy. Like air conditioners, PEL's refrigerators are also in great demand. Today,
PEL Crystal has 30% market share across Pakistan.
PEL Deep Freezers
PEL deep freezers were introduced in 1987 in technical collaboration with M/s Ariston of Italy.
Objectives
The objectives and mission for which the company is established are as following:
 To minimize the cost and increase market share
 To carry on the business or businesses of manufacturing, selling, installing,
maintaining designing and dealing in all kinds of electrical equipment.
 To carry on any business whether manufacturing or otherwise which may be found
convenient to undertake in connection with or in addition to any of these objectives
mentioned above?
 To do all such things that is incidental for the attainment of the above objectives
or any of them.
 To produce high quality and standard products.
 To produce equipment to be used in numerous projects of national importance.
 To secure a high share / quota of WAPDA’s demand for power products.
 To produce skilled workers and technicians through its apprenticeship schemes
and training programs for engineers and technicians.
Marketing standing of PEL

According to PACRA (the Pakistan credit rating agency limited) PEL long term rating is A+
and short term rating is A1. And their action is maintain and outlook is stable. A+ means high
credit quality low expectation of credit risk. The capacity for timely payment of financial
commitments is considered strong. This capacity may, nevertheless, be vulnerable to changes
in circumstances or in economic conditions. A1 mean a strong capacity for timely repayment.
Policy of PEL
PEL’s Legal & Compliance Department organized a Code of Conduct briefing session. An
awareness was set up. The session was specially conducted for the Department Heads and the
General Managers; primary goal was to increase the participants understanding of the
company’s Code of Conduct and to gain their valuable feedback. Emphasis was on the
importance of the Code and its implementation as an imperative measure for the legal and
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compliance procedures to be commensurate with the company’s growth. It is the policy of PEL
to comply with all applicable laws, regulations and corporate ethical standards in the conduct
of its business. Our policy of upgrading our plants with state of the art equipment ensures that
we keep pace with advancements and avoid redundancy. However, with the passage of time,
upgradation and maintenance may result in high costs and threat of entrance of the new players
in the business.
PELS’s Competitors
PEL is organized into two business divisions
 Appliances Division
 Power Division
PEL’s direct competitors in Appliance division

 Dawlance
 Haier
 Orient
 Waves
 LG
PEL’s direct competitors in Power division

 Siemens (transformers) (switch gear) (power transformer)
 Transfopower (transformers)
 Microtech (energy meters)
 Alstom Grid Pakistan (EPC project)
Total Business Volume of PEL

PEL’s total revenue was $3.3 billion (460.55 PKR billion) in 2016.
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PRODUCT LINES OF PEL

Divisions of PEL:
 Power Division
APPLIANCES DIVISION
PEL’s Appliances Division is the flag carrier of the Saigol Group involved in home appliances
manufacturing.
 Air conditioners
 Refrigerator
 Deep freezers
 Microwave oven
 Washing machine
 Generators
 Water Dispensers
POWER DIVISION
PEL Power Division manufactures energy meters,
 Transformers
 Switchgears
 Kiosks
 Compact stations
 Shunt capacitor banks
 Energy meters
 Generators
All these electrical goods are manufactured under strict quality control and in accordance with
international standards. PEL is one of the major electrical equipment suppliers to Water and
Power Development Authority (WAPDA) and Karachi Electrical Supply Corporation (KESC),
which are the largest power utilities in Pakistan. Over the years, PEL electrical equipment has
had been used in numerous power projects of national importance within Pakistan.
In spite of stiff competition from emerging local and multinational brands, PEL Group's
appliances and electrical equipment’s have remained in the spotlight due to constant
innovation. Strategic partnership with multinationals of repute have enabled the PEL Group to
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incorporate new technologies into existing product ranges, thus giving the Pakistani market
access to innovative, affordable and quality products.
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PEL’s Hierarchy Chart
Sales &
Marketing
Power
Manufacturi
Division ng
EPC
Contracting
Sales &
Appliances Marketing
Division
Director Manufacturi
Operations ng
Finance /
Accounts
Chairman
Supply
Managing Management
Director Finance
QA&QC
HRD /
IR&A
Internal
Audit
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Number of Employees
Total number of employees of Pak Elektron Limited (PEL) as at the reporting date are 6,055.
Main offices
Head office: 14 - KM, Ferozepur Road, Lahore.
Regional office: 8-Z-1, Near Bank More, Medina Town, Faisalabad
Regional office: Power Product Dept: Kohinoor Building, 25-West Wharf Road, Karachi
Brief Introduction of all the Departments
Accounts
Budgeting
Taxation
Finance
Sale return
PEL's Deprments
Audit
ERP
Human resource
mangement
Account receivable
Marketing
IT department
Sale department
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PEL’s Departments
Human Resource Department
Department Human resource department of the PEL Company is very much conscious about
hiring the employees for the company. The standards he set for hiring the new people. HRM
department of the company mainly makes the external recruitment. This is usually done
through web sites. Their channel of hiring are LinkedIn, rozi dot com and their own channel
PEL career portal. For the fresher PEL follow merit system take properly tests and interviews
and for experience holder they took directly interview. The HR department of PEL is
responsible for providing on-the-job as well as refresher training for all employees. Compliance
with labor, tax and employment laws is a vital part of safeguarding the organization’s continued
existence.
Information Technology Department

IT department are fully responsible for providing service of internet in Organization. IT
department perform the functions of web links for advertisement of PEL products and maintain
the Web-side of PEL. IT teams of PEL develop tools to collect, store, manage, secure and
distribute data to employees who need access to the latest information to make decisions about
strategic, financial and operational issues Admin Department Administration department is
backbone of an organization. An effective administrator is an asset to an organization. This
department’s function is to handle organization, master planning, financial review, land
acquisition, site accessibility/use, easement standards and outreach and other public concerns.
Marketing Department
Marketing department generally analyse the needs and wants of the customer. Then this
department tells about the customer needs to the company which in turn launches the products
according to the needs of the customers. Marketing department is responsible for making strong
advertisement for the products. PEL marketing department are fully responsible for the
promoting of new and existing products using different tools of marketing. They identify the
target customers and audience. First the select the market and visit the market then setting up
the market strategies. After all that they communicate and sell product to customer through
event, exhibitions, seminars, direct sale, viral marketing, direct marketing and advertising.
They also work with the product development team.
Sale Department
Sale department holds the sale of the company. They handle the overall offices of Pakistan.
Sale department deal with 32 offices. Their only responsibility to sell the products to their
suppliers.
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Audit Department
Audit department that every transaction check like disposal of fixed assets to be approved by
top management and acquiring new assets with approve of tope management. This department
also see financial control on assets & accounts and to avoid errors fraud and theft and sure that
financial statement prepare according to International Accounting Standard.
Finance Department
This department is manage the money of the organization. Finance department of the PEL
mange the money, make the statement, mange loan, identifies the new investments, mange the
taxation and financial planning. In this department have further categories.
Account Departments
Following Functions perform by accounts department of PEL. First they keep the record of
expenses and investments and keeping the bills paid. Second they manage the payment or
salary of the employees and make sure everyone gets paid including the government and report
to their senior.
Budgeting Department
This department of the PEL forecast the future transactions. This entails making at calculated
attempt into knowing what the future holds. Forecasting may not be perfect as evidence has
shown but it is better to have a forecast to work with than not having any as this will help you
get prepared. There are many statistical tools developed over the years to help managers
and accountants make better forecast. And they make plane on the biases of forecast.
Taxation Department
PEL Taxation department manage the taxes. The make strategies to reduces the tax and
calculate the tax.
Sale Return
This department of the PEL manage the sale returns
Account Receivable
PEL’s account receivable department mange the account receivables
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Comments on the PEL’s Organizational Structure

PEL divide department according to their job specifics. Its mean their organizational structures
style is functional every department perform their task according to their work specifics. Every
member cannot access data from the other department. There are many benefit of that PEL of
structure like employees are grouped their knowledge and skills which help to achieve the
highest degree of performance. Their role and responsibilities are fixed.
The hierarchy is apparent and employees don’t have to report to multiple supervisors. Each
employee reports to his or her functional manager, which reduces the number of
communication channels. This hierarchy have some disadvantage like Employees may feel
bored due to the monotonous, repetitive type of work and may lose enthusiasm for the job. The
departments have a self-centred mentality.
The functional manager pays more attention to his department; he usually doesn’t care about
other departments. Communication is weak among the departments, which causes poor inter-
department coordination. This decreases flexibility and innovation. Moreover, there is a lack
of teamwork among different departments. PEL’s decision making style is centralize mean
mostly decision made by top management.
Marketing Department Hierarchy
Marketing
Manager
Assistant of
Advertisement
Marketing
Manager
Manager
Assistant of Executive
Permotion
advertisement Marketing
Manager
Manager Manager
Assistant OF
permotion
Manager
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Number of employees in Marketing Department

Approximately 15 members are working under marketing department. Marketing Department
works only in Head Office Lahore.
MARKETING FUNCTIONS OF PEL

Marketing Mix or 4Ps of PEL:
Price
Products Penetration pricing
Power division Skimming pricing
Appliances division Product life cycle pricing
Competitive based pricing
Marketing
Mix
Promotion Mix
Place Advertising
Direct distribution channel Personal selling
Indirect distribution channel Public relations
Sales prommotion
Products offered by PEL:

The PEL Company consist of two divisions:
 Power Division
Appliances Division:
This Division of PEL consists of appliances manufacturing.
 Refrigerators
 Deep freezers
 Water Dispensers
 Microwave oven
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 PEL LED
 Washing machines
PEL Air Conditioners

PEL window-type air conditioners were introduced in 1981 in technical collaboration with
General Corporation of Japan. Ever since their launch, PEL air conditioners have a leading
position in the market. Recognizing the shift in consumers' preference from window-type to
split-type air conditioners, PEL has focused its manufacturing efforts on split-type air
conditioners.
PEL Refrigerators
The manufacturing of Refrigerators started in 1986-87 in technical collaboration with M/s
IAR-SILTAL of Italy. Like air conditioners, PEL's refrigerators are also in great demand.
Today, PEL Crystal has 30% market share across Pakistan.
PEL Deep Freezers
PEL deep freezers were introduced in 1987 in technical collaboration with M/s Ariston of Italy.
Power Division
PEL's Power Division consists of three Main Products:
 Energy Meters;
 Transformers; and
 Switch gears.
Pricing strategies of PEL

Power Division Pricing Procedure
 First the tender is received which shows the demand of the product.
 It is send to the production department.
 They make calculations about material cost, labor costs and Factory overhead, further
taxes and duties are also calculated.
 Investment is calculated
 Then gross margin is added.
 Gross Margin= Labor Cost + FOH + Profit+ Financial cost + Miscellaneous cost
 Financial cost is found out
 Term and conditions may be different in some cases.
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Appliances Division Price Procedures

 Sales tax, Octopi, excise duty is calculated above the cost of production.
 There is also a pricing trend depending on the models most demanded.
 Price is charged according to demand.
 Consumer product forces also show seasonal, variation i.e., their prices raise during
wedding season and before Eid-ulAzha and Eid-ul-fitar.
Distribution Channels used by PEL

PEL uses different distribution channels .There are different levels. Distribution Channels can
be described by the numbers of channel levels involved. PEL uses both of the two major
Marketing channels.
Direct Marketing Channel

It’s a marketing channel that has a no intermediary levels. PEL’s power division uses this type
of channels. Its major clients are large organizations and not the end user. So people from
these organization directly contact PEL’s marketing department of power division when
tenders are flooded, design, specification and price are discussed.
Indirect Marketing Channel

It is a marketing channel containing one or more intermediary levels. PEL’s appliances
division works this way. These products are sold through authorized dealer shops or PEL’s
own outlets.
Region Distribution
Appliance Division
PEL has got a very effective distribution system that ensures the widespread supply of
company’s product throughout the country for the sake of proper management .
ZONE AREA COVERED
 Northern and Gilgit Baltistan Zone
 Punjab and N.W.F.P
 Southern Zone
 Sindh and Baluchistan
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REGIONS
The zones have been further divided in to six different regions.
 Karachi
 Multan
 Lahore
 Gujranwala
 Rawalpindi
 Faisalabad
Promotion Mix:
Advertisement performs key objectives in any company or an organization growth. This is
quiet necessary part of an organization. Pak Electron Limited uses advertising personal selling,
sales promotion and public relations to pursue its advertising and marketing objectives.
Appliances Division:
 To achieve the sales objectives
 To increase recall
 To restore the message in the customer mind.
 PEL has different Advertising messages for different products.
Media for Advertising

There are three types of media on which advertisement are given:
Electronic Media
In the electronic media, there are many entertainments, business channels where PEL Company
do advertisement. Some of the channels are
PTV
ARY
Geo TV
STN
PTV World
GEO News etc.
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Print Media
Print media is also very important in advertisement field. Today, there are many newspapers,
magazines and periodicals available where PEL do advertisement.
Out-Door Media
 Normal Boarding
 Neo-signs
 Billboards Advertisement
HR Department Hierarchy
Exuctive
Trainee
Mangers
Line Manger
Exuctive
Trainee
Head of Manger
Department Exuctive
Trainee
Manger
Line Manger
Exuctive
Trainee
Manger
Number of Employees in HR Department

Approximately 10 members are working under marketing department. Marketing Department
works only in Head Office Lahore.
Page | 26
Introduction of HR Department
PEL established this department from its establishment to till now providing the best employees
to company. This department works that how they can hire the best people and how they can
cope with modern technology and how they can made their employees to use this modern
technology.
The Human Resource Department at PEL is engaged in the areas of Recruitment and Selection,
Training and Development, Performance Management, and Organizational Development, and
strives to align these functions with the overall business strategy. We place great emphasis on
people development so that people and the organization perform at maximum capacity in a
high effective manner.
Recruitment and Selection

The company aims to recruit and select staffs which are needed to achieve its strategic
directions and who show attributes that are consistent with the organization’s directions and
culture. The purpose of recruitment and selection is the cost efficiency to make the performance
of company more effective. As under the employment legislation every person should have the
equal opportunity for job.
So PEL Company also hiring the best staff according to employment legislation and to make
operational process more effective and efficient by lowering the cost included direct and
indirect cost both. PEL recruit electronically through the Internet. They give ad on their website
https://PEL.com.pk (Career Portal)
https://www.linkedin.com
https://www.rozee.pk
According to Human resource practices these procedures are not very simple for filling of any
vacancy. Once the organization’s human resource needs have been determine, they necessarily
have to be filled. These staffing activities include the following:
 Recruiting job candidates
 Selecting the most appropriate job applicants for the available job
Recruitment and Selection Process

PEL Company follows the whole procedures for which are acceptable at national and
international level both. Mean they follow the standard operating procedure for recruitment
and selection.
 Seek Information
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 Send Information to HR Department

 Approval of Form
 Selection
 Tests
 Interview
 Medical Test
 Back Ground Reference
Training at PEL
Training in PEL. Is basically of two types:
 Training to new employees
 Training to existing employees
Performance Appraisal in PEL

In PEL performance appraisal is recognized as an important element of the jobs of managers
and supervisor. It provides significant help in meeting departmental and company objective.
Given the vital role of performance appraisals, PEL needs to check appraisal system, and the
uses of such appraisal system to determine whether key personnel decisions are affected by
employee’s age, race, sex, religion, colour, national origin or handicap.
Compensation and Rewards

Compensation and benefits are the rewards which are given to the employees for their best
performance and also to make them satisfy at the workplace by giving them the incentives,
bonus, allowances.
Pay For Performance

Salary progress during an employee career with PEL is a function of performance over time.
Better performance is important higher pay. Performance is also key factor in consideration for
promotion.
Performance Designation
Performance designations are defined as follows.
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Outstanding
Individual’s performance consistently exceeds performance criteria in virtually all major
responsibility areas and objectives:
Very Good
Individual performance consistently exceeds performance criteria in some major responsibility
areas and objectives and achieves criteria in all others. Response to unplanned circumstances
meets or exceeds what would be expected.
Good
Individual’s performance fully meets performance criteria in all major responsibilities areas.
Performance is that of an employee who is competent, knowledge, and capable of consistently
achieving quality results on increasing demanding objectives. Unplanned circumstances did
not prevent the meeting object.
Satisfactory
Individual’s performance meets performance criteria in most areas but not up to required
criteria and work accomplished:
Critical Analysis
Marketing Department Analysis
Micro Environment Analysis:
Micro Environment
Micro Environment includes actors close to the company that affect its abilities to serve its
customers the company, suppliers, marketing intermediaries, customer markets, competitors
and public.
It Includes:
Customers
PEL Company customers include various government organization such as WAPDA and
Karachi Power Company regarding power divisions. PEL Company has also an internal and
external customers. Internal customers are those who are the employees of the company which
don’t makes big effect on the sales. External customers are those which are the outsides the
company such as general pubic except employees. We recognize the importance of customer
relationship management and have made significant investments in this regard over the years
going beyond extending credit facilities and trade discounts.
Page | 29
Suppliers
We also acknowledge that engaging reputed and dependable suppliers as business partners for
supply of raw material, industrial inputs, machinery and equipment is the key to our continuous
and sustainable growth. Our success and performance depends upon the loyalty of our
customers with the PEL brand and effective supply chain management.
Competitors
PEL Company has its competitors like Dawlance, Waves, LG, Haier, Orient etc. PEL Company
makes close analysis of its competitors to understand its strategies and to overcome its
deficiencies.
Public Pressure Groups

There is no public pressure group which affect the working of the company because PEL
Company makes product by viewing all its aspects which don’t affect the societal environment
of the economy.
Dealer
PEL nationwide Dealer and Service Centre Network provides us access to a wide range of
customers and enables us to provide quality after sales services. Due to market competition
PEL gave affordable credit policies to its customers.
Macro Environment Analysis

Macro Environment
Macro environment composes of larger societal forces that affect the microenvironment
demographic, economic, natural technological political and cultural forces.
Page | 30
PEST Analysis
PEST analysis consists of Political, Economic, Social, and Technological forces that are
explained one by one below:
Political & Legal Forces

We pride ourselves in being a responsible corporate citizen and abide by the laws and
regulations of Pakistan. Laws and regulations, and other factors controlled by the Government
affect PEL and its activities. PEL Company is very much conscious about the political and
legal environment of the country. The company changes its labor wages which is registered
whenever a govt. changes the labor laws.
Economic Forces
Economic forces means change in disposable Income, flections in the market, inflation, change
in rate of interest etc. Company always keep in mind the economic conditions of the country
and sets its prices accordingly.
Social Cultural Forces

It includes environmental concerns, work life quality attitudes and also work force diversity
etc. PEL Company keeps in view the social culture changes of the country and sets its target
accordingly.
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Technological Forces
PEL Company tries to adopt the future technology for using in the product. They always keep
in view the technology for increasing the quality of the product for their customers. On the
basis of modern technology, company is the market leader regarding the appliances.
Segmentation, Targeting, and Positioning (STP) OF PEL

Market Segmentation
PEL Marketing department is responsible for the attractive segments and to target the best of
them. As PEL does mass marketing so it is good for company. It design a marketing mix using
mechanisms under its control: product, price, place and promotion. The company engages in
marketing analysis. Planning, implementation and control to find the best marketing mix and
to take action. The company uses these activities to enable it to watch and adapt to the
marketing environment. PEL does the segmentation of the market according to geographic and
demographic variables like rural and semi-urban areas and income level of customer.
Market Targeting
Market targeting involves evaluating each market segments attractiveness and selecting one or
more segments to enter. PEL target markets are customers from lower middle, Middle and
upper middle income level and PEL also targets rural suburban areas markets. PEL targets
these markets because it has differential advantages of economical and durable products over
its competitors; where it can generate the greatest customer value and sustain it overtime.
Market Positioning
PEL positions itself as an electronic company offering durable products of best performance at
economical rates. PEL plans positions durability and low prices that distinguish its products
from competing brands like Haier, Orient, Siemens, Mitsubishi, Sabro, Dawlance etc., and give
it the greatest strategic advantage in its target markets.
Competitors’ analysis of PEL

PEL’s Competitors
Dawlance, Orient, Waves, Haier, Lucky Goldstar (LG) are the main competitors of PEL in
appliances division.
Page | 32
Dawlance
Dawlance is a Pakistani manufacturer of major home appliances based in Karachi. Founded in
1980, it was acquired by Istanbul based Arçelik in 2016. Dawlance has three factories, two
sites in Karachi and one in Hyderabad, with a total of 4,000 employees. It manufacture's
washing machines, freezers, split air conditioner and microwave oven's
In 2015, Dawlance had revenues of $220.6 million selling products in Pakistan and Middle
East. Similarly, its EBITDA earnings amounted to $45 million. It has 37 branches in addition
to 750-plus franchises across the country. It was acquired by Arçelik in November 2016 for
$258m, and since then function's a wholly owned brand for Arçelik.
Products of Dawlance
 Refrigerators
 Roaster
 Toaster
 Microwave oven
 Juicer
 Television
 Washing machine
 Dryers
 IRON
 Deep freezers
 Small appliances
Market Share
This company enjoys the leadership position in direct cool products in Pakistan, as its
refrigerators has over 70% market share, freezers 30 %, Microwave oven 65%, Washing
machine 40 % and split air conditioners 30% market share. Dawlance has 23 service centers in
Pakistan. Sales network has reached 850 dealers nationwide.
Positioning
Dawlance position its products on the basis of reliability, as their tagline is “Dawlance is
reliable”.
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Targeting
Up to middle upper class of Pakistan.
Market position
 Leader in household appliances in Pakistan.
 Largest company engaged in appliances business.
Marketing Strategy of Dawlance

The Dawlance group limited is in the process of continuous improvements and innovation to
adopt the efficient measures possible. The company is keen to redesign a robust system that
has the facility for online shopping, marketing procurement, purchasing, customer service,
excellent operational efficiency and extra security so that the extra cost incurred can be
controlled.
Product Strategy
Products which are as per international standards and carry all the basic features. The most
important factors are durability and good after sales services.
Pricing Strategy
Primary focus is to cater to the middle and upper middle class, however there is a selected
range of product which cater to the upper class as well. Uniform pricing throughout the
Pakistan.
Promotion Strategy
Promotion budget is around 1.75% of turnover, 40% of which goes towards print media, 20%
on TV, 20% on outdoor, and 20% on sales promotion.
Placement strategy
More than 800 dealers spread across the country.
Page | 34
SWOT analysis of Dawlance

Strengths
 The company has good market position and turn over.
 The company has latest machinery available producing different household appliances.
 The brand is so popular within Pakistan and has sixteen distributions centre all over the
country.
 The company got very talented technical and managerial staff.
 The company is located in main city Karachi, more near to big markets.
Weaknesses
 The company is losing a lot of money due to extra labours and manual work.
 The company hire graduates but the associated staffs not train them properly that result
in lack of communication, incompetence and very less company knowledge.
 The Managers of different departments not showing their full and motivation for the
company.
 Theft events occur mostly because of no scanning system and irregularity.
Opportunity
 The company can take a lead of Pakistan market by excellent marketing and customer
service.
 The company has the ability to grow and can increase its turn over by Online sale,
marketing and shopping.
 Electronic Business can save huge money by reducing manual work.
 The company has got no online competitor within the country.
Threats
 The company has a major threat to security.
 It is located in main city and has no scanning and proper security system.
 It is in competition in market with china and some other companies like Singer Pakistan.
 Trained and expert technician quits by finding better opportunity.
So on the basis of the above SWOT analysis we can conclude that the company needs new
marketing strategies and online sale opportunity. We are going to design a new relationship of
the company with its suppliers and customers. Detail work and analysis is carried out
Page | 35
Orient Pakistan
Orient is a symbol of innovation in Pakistan and one of the fastest growing consumer electronic
companies in Pakistan. With a wide range of home appliances the company has introduced
modern technologies in the industry at a very affordable price. Orient products can be accessed
from Orient Centers located all across Pakistan as well as local dealers. Orient Refrigerators,
Water Dispensers, LED TVs and Air Conditioners are one of the bestselling products.
Product of Orient
Air Conditioners, LED TVs, Refrigerators, Water Dispensers, Microwave and other small
appliances.
Number of Employs
4000 employees approximately.
Specialties
Refrigerators, 3D LED TVs, Split Air Conditioners, Water Dispensers, Floor Standings,
Cassette Type Air Conditioners, Microwave Ovens, Vacuum Cleaners, Washing Machines
Competitive Advantage
 Innovation
 Low electricity consumption
 Product consume less electricity
 Low cost strategy
 Technical partnership with foreign top class brand like Samsung and Mitsubishi
Segmentation
 High quality expensive products(attracting rich families)
 Medium quality moderate price products
 General products of daily usage
Page | 36
Targeting
The target market of Orient is all the middle range and upper class is focused for their offerings.
They target household appliances as well as offices too.
Positioning
 For whole family
 Age: no limit
 Gender : Both
 Social class: Upper class and middle range classes are focused.
Pricing Strategy
 Penetration strategy: on the launching time Orient set low price to capture middle
income group and somehow Orient increase their price.
 Bundle pricing on special occasions.
Distribution Strategy
 Orient use vertical integration channel.
 From manufacturer to wholesaler to retailer to consumer.
Place
 Channels: 17 sales offices, over thousand dealers and retailers throughout the country
use selective and complementary distribution.
 The distribution channels includes distributers, dealers or retailers.
 Pakistan has 6 regions and they have presence all over there with their offerings.
Promotional Strategy
Print media:
 Newspaper
 Magazines
Page | 37
Electronic media:
 Website
 TV
 Social services
 Ramadan package
 Hajj services
 Wedding offers
SWOT ANALYSIS of Orient

STRENGTHS
 Best advertisement
 Innovative ideas
 Best services
 After sales services
 Guaranteed products
Weaknesses
 Orient is low cost operator
 The company is losing a lot of money due to extra labour
 Associated staff not trained
 Theft events mostly occurs
Opportunities
 Many products
 Innovative machine refrigerator with multimedia system
 Higher standard of living and awareness and in developing Pakistan
 Pakistan is developing country, so there is a lot of business growth. So seeking new
markets in this area is great opportunity.
Threats
 Political Issues
 Law an Order issues
 Environmental Issues
 Economic Instability
 Brand has limited market share compared to market leaders
Page | 38
Haier
Haier Pakistan is a consumer electronics and home appliances company. Established in 2000,
it is a subsidiary of the Chinese multinational group Haier.
It is one of the largest companies in Pakistan's home appliances market, in terms of sales and
revenues generated. Common appliances produced by the group include refrigerators, air
conditioning units, washing machines, kitchen appliances, and handsets.
In 2015, Haier invested $5 million to establish a mobile phone assembly plant in Lahore, which
would annually manufacture over 1.5 million cell phones for the Pakistani market. In the first
half of 2017, Haier sold more than 270,000 refrigerators, exceeding previous years' figures.
The group's CEO is Javed Afridi and it notably owns the Peshawar Zalmi franchise in
the Pakistan Super League, which was acquired for $16 million over a ten-year period. The
group has also sponsored other cricket and sports tournaments in the country.
Tagline of Haier
“Inspired living”.
Products of Haier
Consumer Products
 Refrigerator
 Freezer
 Washing machine
 Air conditioner
 LED
 Cooking
 PC
Business Products
 Commercial Air-conditioner
 Haier Medical
Market Share of Haier

Haier Pakistan has secured the top spot for the home appliances for first quarter of this year in
the country, leading the field with a market share of 30.4 per cent and growth of 16% from last
Page | 39
year. Javed Afridi, the company’s CEO, in a tweet announced that “Haier Air Conditioners &
Refrigerators secured No. 1 market share in the first Quarter of 2018.”
Pricing Strategy of Haier

It’s no doubt that Haier’s differentiation and focused differentiation increased the revenues, but
Haier lost the budgeted consumers due to Haier abandoned low price strategy.
Distribution Strategy of Haier

 The Company distributes its offerings with the help of more than 60000 employees and
distributors across the globe.
 The Company have 5 R&D centers, 21 industrial parks, and 66 trading companies
worldwide to support the mainstream business.
 The company makes its products available in the market with the help of mix channel
of distribution wherein it uses retailers, distributors/ wholesalers, e-commerce websites,
and resellers.
Promotion Strategy
 They use Billboards Advertisement
 Newspaper Advertisement
 Social Media
 TV Commercials.
 They have collaboration with summer Olympics.
 Celebration of the events: Mother’s day lucky draw and Father’s day cricket
tournament.
Customer Analysis of Haier

Customers of Haier are distributors, corporate companies, resellers, and government
organizations across various industries.
In the retail segment, the customers of the brand are in the age group of 20-40 years majority
of which in the mid-age or are newly married and wants to have white goods in their homes.
Page | 40
Segmentation, Targeting, and Positioning of Haier
Segmentation
People looking for consumer electronics & appliances.
Targeting
Middle and upper class segments.
Positioning
The positioning of Haier is satisfying consumer needs through innovative products and a strong
relationship with the distributors.
SWOT Analysis of Haier

Strengths
 Haier quality products and good after sale service.
 Flexible Organizational Structure.
 Distribution Networks
 Customer Orientation
 Enjoying the strong brand name with the quality of its products.
Weaknesses
 Perception of Chinese brand (Stereotype).
 Lower Production Capabilities in abroad.
 Higher Production costs.
 Haier is dependent on China, which can be great weakness of this company.
Opportunities
 Higher Consumption power in Pakistan’s Emerging Market.
 The products of this company are considered the home appliances, so it is widely used
in homes.
 Haier has great and wide product range, which have great price segment.
Page | 41
 The affordable rates of the products can help the company to enhance the sale of its
products.
 Pakistan is developing country, so there is a lot of business growth. So seeking new
markets in this area is a great opportunity.
Threats
 Political Issues
 Law an Order issues
 Environmental Issues
 Economic Instability
 Price War with close competitors
 The local players in the electronic field can affect the business of Haier Group.
Human Resource Management

Human Resource Management is the future of organizations all over the world. Without a
developed HR system, no country can compete in the global arena, and a country like Pakistan
is no different, it needs Human Resource Management for its future growth. Today, therefore
in truly world-class corporations the HRM function has assumed a greater significance and
plays a comprehensive role in organizational management.
Its basic objective “is to provide the required human resource to organization”. So to
provide the human resource to organization establishment of that department was essential.
The major purpose of HRM is to increase and improve the productive contribution of personnel
to the organization in more ethical, social, and administratively responsible way.
In order to meet the requirement of right employees at right time and at right time PEL
established this department from its establishment to till now providing the best employees to
company. This department works that how they can hire the best people and how they can cope
with modern technology and how they can made their employees to use this modern
technology.
The Human Resource Department at PEL is engaged in the areas of Recruitment and Selection,
Training and Development, Performance Management, and Organizational Development, and
strives to align these functions with the overall business strategy. We place great emphasis on
people development so that people and the organization perform at maximum capacity in a
high effective manner.
Page | 42
Vision
To achieve excellence through innovative HR practices and continuously exceeding our people
expectations.
Mission
Our mission is two-fold:
 To manage talent and build capabilities of our people thus enabling them to deliver
sustained performance.
 To facilitate them in creating a collaborative work environment that develops a culture
of continuous learning.
Functions OF HR Department
 Human resource planning
 Job Analysis
 Recruitment
 Selection
 Orientation
 Training and development
 Appraising and managing performance
 Rewards and compensation.
Human Resource Planning

Human resource planning is the 1st and most important function of the department. It is the
base of all other departments. As it is deal with the demand and supply of human resource to
different departments as well as in human resource department. “Human resource planning is
the blend of Art and science, that ensures the effectiveness of management of HR by providing
quality and quantity of employees when and where is necessary.”
As definition shows that this department has linked with quantity (that how many people are
required) and quality (that which type of people are required). Human resource planning
depend upon the functions performed by the PEL. So according to operations we arrange and
made all planning.
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Job Analysis
Job analysis deal with quality of people .That which type of people or employees are required
by department. Through job analysis we also determine that what will be duties of the hired
person and which type of skills he should be contain for the Job. The information is usually
collected by communication with the required department and also by interviewing of
employees individually and also in group forms.
So for selection of employee in PEL first they analyse their whole company, conducted
interview that where which type of people or employee they required. And then they made their
job descriptions and specifications.
Job Description Form

This form contain information like if PEL company want to hire a person in HR Department
than how they will describe all their requirement for the applicants.
This form tells first about.
Title of the Job

Purchase manager.
Job identification
 He will be at manager post.
 He will assist or reported to General Manager of PEL Company.
 His under employees will be assistant manager, import manager and assistant of import
manager.
Role Statement
His duty involve all the activities related to purchase of raw material, machinery and also will
inspect to whom companies they will import either in Pakistan or from foreign countries.
Job environment
 His job timings will be of general time but can be called at any time for emergency
meeting and dealing.
 He will be provided by the official laptop, cell phone with official Number.
 He will be provided by convenience facility.
 His salary package will be of 70,000.
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Job specification
 The required qualification of the candidate should be specialized in Marketing 5 years
of job experience.
 He should have ability how they can do best deal for purchasing of products according
to their finance resources
Recruitment and Selection

Recruitment is a systematic procedure to locate and attract or encouraging in order to fulfil
the vacant position. And selection is the most suitable way or systematic procedure to select
more suitable candidate.
The recruitment and selection decision is of prime importance as obtaining the best possible
person to job fit which will, when aggregated, contribute significantly towards the company’s
effectiveness. It is also becoming important, as the company evolves and changes, that new
recruits show willingness to learn and ability to work as part of a team.
The company aims to recruit and select staffs which are needed to achieve its strategic
directions and who show attributes that are consistent with the organization’s directions and
culture. The purpose of recruitment and selection is the cost efficiency to make the performance
of company more effective. As under the employment legislation every person should have the
equal opportunity for job.
So PEL Company also hiring the best staff according to employment legislation and to make
operational process more effective and efficient by lowering the cost included direct and
indirect cost both.
According to Human resource practices these procedures are not very simple for filling of any
vacancy. Once the organization’s human resource needs have been determine, they necessarily
have to be filled. These staffing activities include the following:
 Recruiting job candidates
 Selecting the most appropriate job applicants for the available job
Both procedures must be done in accordance with Equal Employment opportunity (EEO)
guidelines. Recruitment is one of the core activities of any personnel department. Before the
personnel department can proceed with the recruitment, two further documents are necessary.
Competition for the 'best' graduates requires employers to have a clear idea of what they mean
by 'best'. Recruitment needs to send a strong, distinctive message to these people.
 The Job specification
 A person specification
Page | 45
The line manager should draw these up and it may be necessary for a member of personnel
department to assist. Specifying the job and the type of person required is a line management
responsibility.
Recruitment and Selection Process

PEL Company follows the whole procedures for which are acceptable at national and
international level both. Mean they follow the standard operating procedure for recruitment
and selection.
Seek Information
First they get the information about the relevant department in which the vacancy is available.
Send Information to HR Department

Departments fill the slip named Man Recognition Slip in which they mention all their
requirements about employee needed like age, when and why employee require, experienced
or fresh employee, insurance and car etc.
Approval of Form
Then Head of Department (HR) send the slip to chairman and Managing Director. From their
approval further procedure start. Potential candidates may come from an internal Side of the
organization, or from the external job market. The Information is reached through channels
such as recruitment advertising, employment agencies, professional associations or word of
mouth.
There are two approaches which can be used for hiring of potential employees
 Internal Sources.
 External sources.
Internal Resources
For a simple and ordinary job Organization with strong culture mostly look for school leaving
and bachelors .but for high level post or job they usually prefer the internal job market. So PEL
Company Do This by job posting and employee referral programs.
Page | 46
Job Posting
These methods of prominently displaying current job openings extend and open invitation to
all employees in the PEL Job posting serve the following purposes:
 Provide opportunity for employee growth and development
 Provide equal opportunity for advancement to all employees
 Communicate organization goals and objectives and allow each individual the
opportunity to help find a personal fit in the organization job structure.
Promote the Employees within the Company

 By analyse the Personnel replacement charts HR manager evaluate the performance
and promotion ability of inside candidate for the most important positions.
 Usually this option is for firm’s top positions. The management creates a card for each
position, showing possible replacements as well as their present performance,
promotion potential, and training.
External Sources
When company does not able to find the appropriate person from the internal side of the
organization according to the job specification form than they find the best person from the
outside.
External selection is done by the Equal opportunity for every person. This can only be achieved
through public and open recruitment. The likelihood of attracting 'suitable' applicants depends
on the detail and specificity of the recruitment advertisement or literature. Key factors such as
salary, job title, career and travel opportunities obviously influence response rates.
PEL does not always produce enough qualified applicants internally so it needs external
sources including bringing in people with new ideas. The external method includes media such
as newspaper.
Giving Advertisement on Internet

One of the main recommendations is incorporating a link from the corporate home page
directly to the careers section on the company's Web site. Another Best Practices feature is to
make information available to candidates about a company's culture and work environment.
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It is critical that all companies make the most effective use of their corporate career Websites,
to brand their companies with potential candidates, who may also be customers and
shareholders. Benchmarking practices against those of the Fortune 500 provides a useful
measurement and perhaps motivation to implement best online recruiting practices.
A large and fast growing Rate of employers use the Internet as a recruiting tool. PEL recruit
electronically through the Internet. They give ad on their website
https://PEL.com.pk (Career Portal)
https://www.linkedin.com
https://www.rozee.pk
Employee Referral Programs

Word-of-mouth applicants are likely to stay longer and may be more suitable than recruits
obtained by advertising. But word-of-mouth is discriminatory, since it restricts applications to
established communities and excludes recently arrived minority groups who have not had time
to become part of informal networks.
This method is a low cost per hire way of recruiting, even though the candidates, in many cases,
come from outside the organization. This method is useful for finding applicants in short supply
and managerial candidates.
Selection
The recruitment Procedures should have attracted a pool of applicants from which selectors
can make their choice. If a job analysis has been conducted, the criteria or competences which
are deemed necessary have been identified. These may be well defined and focused on
experience and skills. As in the 'right person' approach; or general and related to education,
intellect and personality for the 'cultural fit' and 'flexible person' models after the candidates
have been identified, and they must be selected.
In PEL common procedures use in selection include:

 Obtaining completed application forms or resume
 Checking education, background, experience and references
 Taking Tests & Interviewing the candidates.
 The selection procedure results in a match between a candidate’s ability and the skills
required by the job.
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Tests
PEL test only the external employees not the internal employees, because they have the
complete data of internal candidates. Tests provide use full back-up information and are an aid
to selection but they cannot entirely replace the interviewer. It tests the candidates only for
specific positions not for all the vacancies.
Interview
PEL conduct behavioral interviews to screen out the candidates. Behavioral interview is a
series of job related questions that focus on how they reacted to actual situations in the past.
They also conduct individuals’ multiple interviews. The HR management conducts the
interview. Also the related department conduct interview. Their main purpose for the
interviewer to ascertain if the candidate is suitable for the vacancy, and for the candidate to
determine whether the job is suitable for him or her. They have very specific panel for
conducting interview. In which the executives of the related department are present.
Medical Test
The candidates who passed the interview are passed through medical test PEL have linked with
so every candidate got examined there and his report are send to department if candidate have
every test clear than he selected for job.
Back Ground Reference

The person who have been selected their background references are checked. So in this way
PEL Company select the required person for the required vacancy. And person designated as
the employee of the company.
TRAINING & DEVELOPMENT

At every organization to cope with the new techniques training of new and exiting staff is
essential. So it is the second function of the HR department to arrange the training and
development program for the employees. These qualities can be bought from outside the
organization through recruitment, consultancy and subcontracting, or grown by training and
developing existing employees.
Training
Is a systematic procedure to equip or impart the knowledge and skills needed to competently
perform the current job?
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Development
Is a set of planned activities designed to prepared employees for their future job role?
Training at PEL
Training in PEL. Is basically of two types:
 Training to new employees
 Training to existing employees
 External training
 Internal training
Training of New Employees

PEL have a very descriptive introduction plan for the new employees. The training of new
employees basically consist of two parts.
 Induction or orientation.
 Socialization
Induction Training
Systematic process to educate new employees about the organizational philosophy and
policies. And also concern about the job department and job duties that will be perform by the
employees.
Philosophies included the destination, target and aim of the company. It also consists of the
mission statement knowledge, core values, vision, culture, norms, values shared by the
members.
Policies included the time, shift time, compensation etc. And knowledge about the concerned
department in which the person has been required to perform their duties.
Department training over an initial period of one to six months shall follow this.
Orientation Program
Contents
They basically have three days Orientation program for new employees in which they describe
to employees with basic background information about the firm such as:
 Welcome note from management director
 Mission, Vision, Values
 Brief introduction of PEL
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 Company profile
 Organization
 Product profile
 General guidelines
 The working hours
 Head office
 Plant
 Canteen mess
 Bank account details
 Fair price shops
 Traveling
 Department visit
 Meeting with HOD
 Colleague
 And other miscellaneous things
General Guidelines
Working Hours
Head Office of PEL
 08:30 TO 04:30 from Monday to Saturday.
 They (essential) staff of HR, GS and sales will be on duty for day-today
 Matters.
 Lunch and prayer is 13:00 to 14:00 hours.
 Attendance currently is to be marked on the attendance sheet maintained by GSD and

placed on reception.
Plant
 Operations at plant rotate clockwise in three shifts.
 Timings for morning shift are 08:30 to 04:30 from Monday to Saturday.
Canteen Mess
 Facility is available at head office as well as at Factory.
 At head office expenses are deducted from the salary.
 At plant expenses are paid directly as well as deducted from the salary.
 Employees can check their category from the relevant accounts section.
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Bank Account Details

Salary is paid through bank to all the company permanent employees as well as contractual
staff. HR & Finance departments, regarding opening of account in the designated bank nearest
to your residence/ place of appointment is available for coordination.
Fair Price Shops

Company has provided fair price facility to all its employees where company products are
available at subsidized prices. Different quantities are allowed to different category of staff on
monthly basis. The shops are located at head office, plant, and Jhang and Arifwala zones.
Timing may vary from season to season or otherwise.
Who Supervises the Training Program

Internal management
Internal management supervise orientation program. This job has been given to their Manager
Training and Development who made the panel of people to supervise orientation according to
the nature of job.
Procedure of Orientation
According to Managers the new employee has been rotated almost in every department in
his orientation so he is able to practically see the things happening in the organization. It helps
reduce the new employees jitters and the Reality shock he or he/ she might otherwise
experience (the discrepancy between what the new employee expected form his or her new job,
and the realities of it).
Departmental Training
After induction training the employee has been shifted to the department he was employed for
to go through departmental training and the training of other relevant departments whom he
has to interact in his day-to-day activities. This basically is the start of his probation period.
On The Job Training

PEL always prefer to give on the job training to the new employees because they think that on
the job training is the best way to make employees learn the skills required to perform different
tasks.
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Training of Existing Employees

For training of existing employees some points are followed by the PEL Company like:
 Training need Assessment
 Training design.
 Training implementation.
 Training evaluation
Training Need Assessment

First company analyse where the performance gap is coming. Its purpose is to identify where
training can make major contribution to improve organizational performance. It sets out the
answer of the following questions about the way the organization is functioning now and is
expecting to function in future:
 What?
 When?
 Where?
 Why?
 Who?
 How?
By asking and searching for all these questions they will be able to find answers they will
discuss all problems and solutions. Important issues need a planned response and the cases of
problem need to be established and possible solution identified. Training is one possible
response and should be selected only when it is most appropriate. Through the training need
assessment the company can be able to find the problems that can be happened in the future
and same they can take action for the potential problem before the time. So PEL Company
also use the proactive approach to safe their company from the future and unanticipated
problems.
The process of conducting a TNA will allow decision to be made, on the basis of evidence,
about where training will offer the best investment. It will strengthen for funding training and
allow priorities between training need to be established. It will also provide information upon
which to judge whether resources currently employed in training to be used more effectively.
A training gap can be set to exist if the performance deficiency is due to lack of knowledge
and skill. The limitation of this individual approach is that it can result in demands for training
for every employee. These demands may be for training to improve current performance or
develop the potential of the individual.
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Training Design
After finding the reasons for the performance gap PEL Company design how they will
overcome this gap.
Training Ability
For making the training design HR Manager OF PEL Company also considers the factors that
how much knowledge and ability their existing employees have already. And in which fields
they have to be more trained.
PERFORMANCE MANAGEMENT AND APPRAISAL SYSTEM

Performance appraisal is a process for establishing shared understanding about what is to be
achieved, and an approach to managing and developing people in a way which increases the
probability that it will be achieved in the short and long term. The purpose of performance
appraisal is to improve the organization’s performance through the enhanced performance of
individuals.
The main objectives of performance appraisal are:
 To review past performance
 To assess training needs
 To help develop individuals
 To audit the skills within an organization
 To set targets for future performance
 To identify potential for promotion
Performance Appraisal in PEL

In PEL performance appraisal is recognized as an important element of the jobs of managers
and supervisor. It provides significant help in meeting departmental and company objective.
Given the vital role of performance appraisals, PEL needs to check appraisal system, and the
uses of such appraisal system to determine whether key personnel decisions are affected by
employee’s age, race, sex, religion, colour, national origin or handicap.
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Performance Planning
 Establish & Define
 Key Responsibilities
 Objectives
 Expected Outcomes
 Priorities
 Behavioral factors
Establish & Define

This is the first step in Performance planning in which PEL Performance management tells his
employees about the company establishment. That this company is establishing at that time,
about company history, its culture, rules and regulations and define the purpose of the
establishment. That what is the vision and mission of the company.
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Key Responsibilities
Key responsibilities mean to tell the employees of PEL about the responsibilities which are
essential to perform for the purpose of achieving their target.
Objectives
Objectives tells the employees what are the targets and goals of the company and how they will
achieve their targets, what are the ways or strategies about through which they can achieve
their mission or target.
Expected Outcomes
PEL Performance Management tells about the outcomes and result which they want by the
performance of each employee. How they can provide the required results. What type of
activities will be performed by them for the desired outcomes?
Priorities
PEL Performance Management tells about the priorities of the company mean in which they
want to be, more grown. What are the points which should be more consider and more need
attention .in what product they want to grow more .so in this point they tells about the priorities
of the company.
Performance Monitoring
 Timely relevant feedback
 Maintain Load
 Quarterly Review
 Refine Responsibilities
 Revisit priorities
Timely Relevant Feedback

In this step the performance management get the feedback about the performance of the
employees. That their performance sis according to their planning or not. Than after taking
feedback in to consider they make plans now what type of steps should be make.
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Maintain Load
Through performance monitoring they can balance their work load. That how they can
effectively and efficiently balance their targets so that can be achieved without any burden or
threat.
Quarterly Review
In this method they monitor their performance on quarterly basis. PEL Company divides its
target in to annually, monthly basis. So after 4 months they conduct a big audit and check all
the aspects about the target which they have to achieve till now.
Refine Responsibilities
After examine all the activities than performance management again refines their
responsibilities among the employees. This is more convenes because it is based after the
performance analysis.
Performance Appraisal
 Compile/Review data
 Request self-appraisal
 Review with next-level supervisor
 Finalize appraisal
 Meet With Employee
Compile /Review Data

In this we collect all the analyse data and compile it in the form so that this may be review
again for making the target near to achieve.
Development & Follow Up

 Identify interests & needs to enhance performance
 Establish Training plan
 Review job description
 Identify new challenges
Identify Interests & Needs to Enhance Performance

This step is the last step in which we take the entire step after the analysis. In it we find the
interest of the company within its environment .that what type of changes are occurring and
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how company can go well with this changes. And in which fields company have to make
more good performance.
Establish Training Plan

After releasing that in which department and Field Company should have more good
performance .performance management establishes its training program for the employees
for getting more performance. This training plan is very essential to make the performance
better for future as well as for current job.
Review Job Description

According to the changes which Management wants to see for making company performance
better we again review the job description form. Again made and tell about the job, roles
statement, and physical working environment.
Identify New Challenge

To make our company more globalize not only at the national level but also on the
international level we have to continuously consider the facts about new changes at
international market for making our company to cope with this challenge more properly and
good.
COMPENSATION AND REWARDS

Compensation and benefits are the rewards which are given to the employees for their best
performance and also to make them satisfy at the workplace by giving them the incentives,
bonus, allowances.
Pay For Performance

Salary progress during an employee career with PEL is a function of performance over time.
Better performance is important higher pay. Performance is also key factor in consideration for
promotion.
Performance Designation
Performance designations are defined as follows.
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Outstanding
Individual’s performance consistently exceeds performance criteria in virtually all major
responsibility areas and objectives:
Very Good
Individual performance consistently exceeds performance criteria in some major responsibility
areas and objectives and achieves criteria in all others. Response to unplanned circumstances
meets or exceeds what would be expected.
Good
Individual’s performance fully meets performance criteria in all major responsibilities areas.
Performance is that of an employee who is competent, knowledge, and capable of consistently
achieving quality results on increasing demanding objectives. Unplanned circumstances did
not prevent the meeting object.
Satisfactory
Individual’s performance meets performance criteria in most areas but not up to required
criteria and work accomplished:
Medical/Hospitalization Expenses
In order to assist the permanent Employees and their immediate family members spouse and
departmental children not more than 19 years old and in case of unmarried and full time
students the limit increased (to23 years) to maintain their good health and pay for costs incurred
on medicines, medical services and hospitalization for themselves and their eligible family
members, the will reimburse 100% of the employee’s actual expenses. The employee will be
reimbursed for the expenses on presentation of doctor’s prescription and receipts. Medical
expenses (purchase of medicines) etc. for up to or less than Rs.500 (five hundred only) will be
exempted from presentation of doctor’s prescription.
Uniform and Locker facility

Company gives two uniforms in a year to its workers and also provides lockers to them for the
safety of their personal things.
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Conveyance Allowance
Company pays Rs.5 per kilometre for car and Rs.3 per kilometre for motorcycle in case of
office work.
Loans
Loan is given to the employees from the provident fund; car loans are also given to the
executives level officers.
Probation Period
Purpose
PEL set probation policy regarding the serving of a probationary period for staff members
covered by a collective bargaining agreement who are newly hired. Probation is for newly
appointed employees only.
Responsibility
The Head of Department Human resources is to ensure compliance with this policy.
Duration
Probation period in PEL is six months for Managers and three months for executive. Probation
periods may be extended, with reason, where the employer is not convinced with employee
performance to the required standard, and some time if employee does achieve the desired
result the company will terminate the employee.
 Employment Letter is attached
 Confirmation Letter is attached
Letter showing Different Allowances and Benefits is attached.
Description of Some of the Benefits

All benefits, allowances and salary vary equally from grade to grade.
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Salary Structure
Salary is based upon the market practices. They attract their employees from market pay levels.
The basic salary structure is as:
Minimum Maximum
Executives Rs 1200,000 2000,000
Managers Rs 400,000 800,000
Non-Executives Rs 180,000 250,000
Supporting Staff Rs 80,000 120,000
Basic Salary
 House rent allowance @ 45% of basic salary
 Utilities @ 10% of basic salary.
Provident fund
When employee’s service became confirm than they allowed the provident fund at least @
10% of the basic salary. The company will also contribute an equal amount for credits to the
PF account of the employee.
Gratuity
PEL Company also provided the gratuity fund to employee on leaving the job. It’s the
obligation on company to pay the fund to employee when he will leave the job or will fill the
year of his job.
Medical Outpatient Allowance

It is per month allowance in addition to the gross salary. But it doesn’t form the part of the
salary for any other benefits e.g. Provident fund, bonus.
Annual Bonus
Bonus on salary is provided annually to the employees.
Increments
Increments on the salary of the PEL Employees is occurred at 16% annually rate.
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House Rent Allowance

An employee shall be entitled to receive from company a house rent allowance or house rent
ceiling on such scales and on such terms and conditions as may be determined by the
Competent Authority from time to time. The present rates of house rent allowance or ceiling
are given below:
 Executives 50% of Basic Salary
 Officers 30% of Basic Salary
 Clerical 20% of Basic Salary
 Non Clerical 45% of Basic Salary
Electrical Appliances for Employee

All employees shall be allowed to purchase furniture fixture and electrical appliances for their
residence up to a certain limit as per following entitlement:
Position Electrical Appliances
 CEO Rs 500, 000
 General Manager Rs 250, 000
 Country Manager Rs 200,000
 Assistant Country Manager Rs 100,000
Entitlement of Cars for the Executives

Executives will be provided with the Official car and instead mark-up free loan and a cash
allowance will be allowed to eligible executives in order to assist them in buying a car of their
choice for business and personal use.
 CEO BMW
 General Manager Honda Accord
 COUNTRY MANAGER HONDA CIVIC
 ASSISTANT C.M TOYOTA XLI
Mobile Phone Facility

Executives will be provided with official mobile phone with following monthly bill ceiling:
 CEO Rs 80,000
 General Manager Rs 50,000
 Country Manager of each Sector Rs 30,000
 Assistant Country Manager Rs 20,000
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Finance Department Hierarchy
Loan Funding Assistant of

Manager Loan Manager EXECTIVE
MANAGER
Finance
Manager
Assistant Of
Accounts
accounts EXECTIVE
Manager
Manager MANAGER
Number of Employees under Finance Department

Approximately 50 or more employees working under finance department.
Sub-department in Finance
Finance
Department
Account
Accounts Budgetings Taxation Sale Returns
Receivable
Ratios of PEL
Profitability Ratios
Gross Profit Rates
Formula: GPR= Gross profit/net sales
GPR=9116/31000*100= 29.41%
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Return of Sale
Formula: Return on sale = net income/net sale
ROS=3308/31000*100 = 10.67%
Return on Assets
Formula: Return on asset= net income/average total asset
ROA=3308/43916*100=7.53%
Return on Stockholder’s
Formula: Return on stock holder’s equity =Net income/average stock holders’ equity
ROSE=3308/27001*100=12.25%
Turnover Ratios
Inventory Turnover Ratio:
Formula: Cost of goods sold/Inventory = Inventory turnover
= 22192115000/8149848000
= 2.72 times
Inventory turnover ratio tell that how many times the inventory has been turned over (sold)
during the year.
Inventory Turnover in Days

Formula: ITID =365/Inventory turnover ratio
= 365/2.72
= 134 days
Total Assets Turnover (Capital turnover)

Formula: TAT=Net Sales/Total Assets
=26166312000/37049048000
= 0.706 times
Total Assets turnover ratio measures the relative efficiency of total assets to generate sale.
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Account Receivable Turnover

Formula: Account receivable turnover =Annual net credit sales/Receivable
= 26166312000/5795789000
= 4.51 times
This ratio define that how many times the receivable turned over (into cash) during the year.
Accounts Payable Turnover

Formula: Account payable turnover= Annual net credit purchases/Payables
= 22496163000/887948000
=25.33
This ratio define that how many times the payables turned over (into cash) during the year.
Liquidity Ratios
Current Ratio
Formula: Current ratio = current assets/current liabilities
=25017m/10415m
=2.41times
Acid Test Ratio

Formula: Acid test ratio=quick asset/current liabilities
=16144m/10415m
=1.55times
Net Working Capital
Formula: Networking capital = current assets-current liabilities
=25017m-10415m
=14602m
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Leverage Ratios
Debt Ratio
Formula: Debt ratio=total liabilities/total asset
=16915m/43916m
=0.3831 times
Equity Ratio
Formula: Equity ratio= total equity /total assets
=27001m/43916m
=o.6148 times
Debt Equity Ratio

Formula: Debt equity ratio= total liabilities/total equity
=16915m/27001m
=0.6264times
Valuation and Growth Ratios

Price Earnings Ratio
Formula: Price earnings ratio=market value price per share/ earning per share
=47.49/6.56
=7.24 times
Dividend Pay-out Ratio

Formula: Dividend pay-out ratio= dividend per share/earning per share
=3.25/6.56*100
=49.54%
Dividend Yield Ratio

Formula: Dividend yield ratio= dividend per share /market price per share
=3.25/47.49*100
=6.84%
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Solvency Ratio
Formula: Solvency ratio= net profit + depreciation/total liabilities
=3308m+881926/16915m
=0.196 times
Ratio Analysis
Liquidity Ratios
The liquidity of a firm is measured by its ability to satisfy its short-term obligations as they
come due.
Current Ratio
The current ratio, one of the most commonly cited financial ratio, measures the firm’s ability
to meet its short-term obligations. A higher current ratio indicates a greater degree of liquidity.
Year 2016 2017

Current ratios 2.84 times 2.41 times
Interpretation
As current ratio represents the firm’s ability to meet its short-term obligations. So the PEL
current ratio decreased in 2017 as compare to 2016. But PEL trying to increase their liquidity.
Quick ratio
The quick ratio or acid test ratio is a liquidity ratio that measures the ability of a company to
pay its current liabilities when they come due with only quick assets.
Year 2016 2017
Quick ratios 1.73 times 1.55 times
Interpretation
A ratio shows that organization pay off its debt without selling any securities. Quick ratio is
also decreased in 2017 as compared to the 2016.
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Activity Ratios
Activity ratios measure the speed with which various accounts are converted into cash inflows
or outflows. Activity ratio measure how efficiently a firm operates along a variety of
dimensions such as disbursements, and collections.
Total Assets Turnover

The asset turnover ratio is an efficiency ratio that measures a company’s ability to generate
sales from its assets by comparing net sales with average total assets. In other words, this ratio
shows how efficiently a company can use its assets to generate sales.
Year 2016 2017
Total asset turnover 0.67 times 0.71 times
Interpretation
Total asset turnover increased in 2017 as compared to 2016 by the amount which shown in
above chart.
Inventory Turnover
The inventory turnover ratio is an efficiency ratio that shows how effectively inventory is
managed by comparing cost of goods sold with average inventory for a period. This measures
how many times average inventory is “turned” or sold during a period.
Year 2016 2017
Inventory turnover 2.84 times 2.74 times
Interpretation
It measures how many times a company sold its total average inventory dollar amount during
the year. So the PEL inventory turnover ratio increased in 2017 as compared 2016.
DEBT/ receivable Turnover Ratio

The accounts receivable turnover ratio is an accounting measure used to quantify a company's
effectiveness in collecting its receivables or money owed by clients.
Year 2016 2017
Debt turnover ratio 4.42 times 4.23 times
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Interpretation
As this ratio measures the proportion of total assets financed by the firm’s creditors. The higher
this ratio, the greater the amount of other people’s money being used to generate profits. The
higher this ratio, the greater the firm’s degree of indebtedness and the more financial leverage.
But in the year of 2017 PEL debt turnover ratio has been increased as compared to 2016.
Payable/ creditor Turnover Ratio

The accounts payable turnover ratio is a short-term liquidity measure used to quantify the rate
at which a company pays off its suppliers. Accounts payable turnover shows how many times
a company pays off its accounts payable during a period.
Year 2016 2017

Creditor turnover ratio 24.57times 27.11 times
Interpretation
Creditor turnover ratio of PEL increased in the year of 2017 as compared 2016. Turnover
ratio is increasing, the company is paying off suppliers at a faster rate than in previous
periods. An increasing ratio means the company has plenty of cash available to pay off its
short-term debt in a timely manner.
Fixed Assets Turnover Ratio

It indicates how well the business is using its fixed assets to generate sales.
Year 2016 2017
Fixed assets turnover ratio 2.04times 2.39 times
Interpretation
The higher the ratio, the better, because a high ratio indicates the business has less money tied
up in fixed assets for each unit of currency of sales revenue. Fixed assets turnover ratio
increased in the year of 2017 as compared to 2016.
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Capital structure /Leverage Ratio

Debt to Equity Ratio
The ratio is used to evaluate a company's financial leverage. The D/E ratio is an important
metric used in corporate finance. It is a measure of the degree to which a company is financing
its operations through debt versus wholly owned funds.
Year 2016 2017
Debt/Equity ratio 20.80 percent 18.37 percent
Interpretation
As observed that debt to equity ratio decreased from 2016 to 2017. Lower debt to equity ratio
indicates a company or stock with lower risk to shareholders.
Time Interest Earned Ratio

The times interest earned ratio measures the ability of an organization to pay its debt
obligations. The ratio is commonly used by lenders to ascertain whether a prospective borrower
can afford to take on any additional debt.
Year 2016 2017
Time interest earned ratio 5.16 percent 4.49 percent
Interpretation
PEL time interest earned ratio decreased in 2017 as compared to 2016. It means company
solvency chances increases.
Profitability Ratios
Profitability ratios are a class of financial metrics that are used to assess a business's ability to
generate earnings relative to its revenue, operating costs, balance sheet assets, and shareholders'
equity over time, using data from a specific point in time.
Return on Equity
The return on equity ratio or ROE is a profitability ratio that measures the ability of a firm to
generate profits from its shareholders investments in the company.
Year 2016 2017
Return on equity 14.39 percent 12.25percent
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Interpretation
The return on equity (ROE) of PEL Company decreased in 2017 as compared to 2016 which
show the negative effect. It measures the return earned on the common stockholder’s
investment in the firm. Generally, the owners are better off the higher is this return. It indicates
that the company have earned less on each rupees of common stock equity in this year.
Gross Profit Ratio

Gross profit ratio (GP ratio) is a profitability ratio that shows the relationship between gross
profit and total net sales revenue. It is a popular tool to evaluate the operational performance
of the business. The ratio is computed by dividing the gross profit figure by net sales.
Year 2016 2017
Gross profit ratio 30.87 percent 29.41percent
Interpretation
Gross profit ratios is decreased in the year 2017 as compared to the year of 2016. It mean in
this year company earn less profit margin on its products as compare to 2016.
Return on Sale
Return on sales (ROS) is a ratio used to evaluate a company's operational efficiency. This
measure provides insight into how much profit is being produced per dollar of sales.
Year 2016 2017
Return on sale 13.68 percent 10.67percent
Interpretation
In the year 2017 company cannot performed well as compared to 2016 that’s why in this year
company return on sale ratio is low.
Investment/Market Ratios
Market value ratios are used to evaluate the current share price of a publicly-held company's
stock. These ratios are employed by current and potential investors to determine whether a
company's shares are over-priced or under-priced. The most common market value ratios are
as follows:
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Earnings per Share

Earnings per share (EPS) ratio measures how many dollars of net income have been earned by
each share of common stock. It is computed by dividing net income less preferred dividend by
the number of shares of common stock outstanding during the period.
Year 2016 2017
Earnings per share 7.51 rupees 6.56 rupees
Interpretation
Earnings per share decreased in the year 2017 as compared to 2016.
Dividend Pay-out Ratio

The dividend pay-out ratio is the ratio of the total amount of dividends paid out to shareholders
relative to the net income of the company. It is the percentage of earnings paid to shareholders
in dividends.
Year 2016 2017

Dividend pay-out ratio 39.95 percent 49.53 percent
Interpretation
In the year 2017 dividend pay-out ratio increased as compare to 2016. It mean in the year 2017
company pay more total amount of dividends to shareholders relative to the net income as
compare to the recent year.
Dividend Yield Ratio

The dividend yield is a financial ratio that measures the amount of cash dividends distributed
to common shareholders relative to the market value per share.
Year 2016 2017
Dividend yield ratio 4.21 percent 6.84 percent
Interpretation
A higher dividend yield ratio indicate company is pay more dividend relative to its market
value. So in the year 2017 company dividend yield ratio as compare to 2016.
Page | 72
Horizontal Analysis Balance Sheet

2017 2016 2015 2016 vs 2017 2015 vs
RS. In RS. In RS. In Percentage 2016
million million million Percentage
Equity and _______ ________
liabilities
Share capital _______ ________
and reserves
Issued, 5426 5426 4431 _ 22.46
subscribed and
paid-up capital
Capital reserve 4280 4280 4294 _ 230.79
Accumulated 13,020 11,134 7891 16.94 41.09
profit
Total equity 22,727 20840 13616 0.091
Advance 1575 (100.00)
against issue of
ordinary shares
Surplus on 4,274 4,671 4804 (8.49) (2.78)
revaluation of
property, plant
and equipment
Liabilities
Non-current
liabilities
Redeemable 69 3,152 3879 (97.82) (18.76)
capital
Long term 3,958 1,406 2187 183.07 (35.69)
finances
Liabilities 22 46 61 (51.69) (24.39)
against assets
Deferred 2,413 2,326 2262 3.75 2.84
taxation
Deferred 39 41 43 (5) (5.00)
income
Total 6,501 6,971 8432 (6.42) (7.33)
Current
liabilities
Trade and 993 915 815 8.49 12.26
other payables
Page | 73
Accrued 166 159 261 3.86 (38.90)

interest
Short term 7,227 4,982 4669 45.08 6.70
borrowings
Current 2,027 1,788 1977 12.18 (9.52)
portion of non-
current
liabilities
Total 10,413 7,845 7722 32.47 1.59
Total liabilities 16,915 14,816 16154 14.17 (8.28)
Total equity 43,916 40,327 36149 8.90 11.56
and liabilities
Assets
Non-current
assets
Property, plant 17,406 16,442 15510 5.86 6.01
and equipment
Intangible 316 324 338 (2.51) (4.33)
assets
Long term 9 26 9 (66.41) 195.77
investments
Long term 372 39.64 290 266 (8.09)
deposits
Long term 797 1,009 572 (21.01) 76.37
advances
Total 18899 18068 16719 4.60 8.07
Current assets
Stores, spares 746 813 793 (8.18) 2.46

and loose tools
Stock in trade 8150 7846 6182 3.88 26.91
Trade debts 10728 8433 7700 27.20 9.52
Due against 1393 1128 1024 23.51 10.19

construction
work In
Progress
Short term 846 955 914 (11.42) 4.49
advances
Page | 74
Short term 1109 1259 1331 (11.89) (5.44)

deposits and
payments
Other 311 480 390 (35.22) 23.10
receivables
Short term 22 23 86 (5.55) (72.98)
investments
Advance 1228 770 433 59.49 7.87
income tax
Cash and bank 484 552 578 (12.32) (4.41)
balances
25017 22259 19431 12.39 14.56
Total assets 43916 40327 36149 12.39 11.56
Balance sheet analysis (assets)

30000
25000
20000
15000
10000
5000
0
2017 2016 2015 Category 4
Non-current assets Current assets
Horizontal Analysis Profit and Loss Statement

2017 2016 2015 2016 vs 2017
Revenue 42347 34124 29323 24.10 16.37
Sales tax and (11347) (7290) (4201) 55.65 73.52
discount
Revenue net 31000 26834 25122 15.52 6.81
Cost of sales (21884) (18550) (17688) 17.97 4.88
Page | 75
Gross profit 9116 8284 7434 10.05 11.43

Other income 18 37 36 (52.31) 4.02
Distribution cost (2684) (1628) (1331) 64.86 22.29
Administrative (1119) (884) (758) 26.55 16.56
and general
expenses
Other expenses (176) (194) (188) 9.04 3.27
(3979) (2706) (2277) 47.05 18.82
Operating profit 5155 5616 5193 (8.20) 8.14
Finance cost (1547) (1497) (1665) 3.35 (10.14)
3609 4119 3528 (12.39) 16.77
Share of loss of (5) 0 (13) (1832.69) (102.29)
associate
Profit before 3603 4119 3514 (12.53) 17.22
taxation
Taxation (295) (34.32) (634) (450) (29.12)
Profit after 3308 3670 2880 (9.86) 27.43
taxation
Other __ __ __ __ __
comprehensive
income
Total 3308 3670 2880 (9.86) 27.43
comprehensive
income
Page | 76
Revenue/ Gross Profiit

45000
40000
35000
30000
25000
20000
15000
10000
5000
0
2017 2016 2015
Revenue Gross profit
Vertical Analysis Balance Sheet

2017 2017 2016 2016
RS. In million percentage RS. In million Percentage
Equity and
liabilities
Share capital
and reserves
Issued, 5426 12.36 5426 13.46
subscribed and
paid-up capital
Capital reserve 4280 9.75 4280 10.61
Accumulated 13,020 29.65 11,134 27.61
profit
Total equity 22,727 51.75 20840 51.68
Advance against
issue of ordinary
shares
Surplus on 4,274 9.73 4,671 11.58
revaluation of
property, plant
and equipment
liabilities
Non-current
liabilities
Redeemable 69 0.16 3,152 7.82
capital
Long term 3,958 9.06 1,406 3.49
finances
Page | 77
Liabilities 22 0.05 46 0.12

against assets
Deferred 2,413 5.50 2,326 5.77
taxation
Deferred income 39 0.09 41 0.10
Total 6,501 6,971 (6.42)
Current
liabilities
Trade and other 993 2.26 915 2.27
payables
Accrued interest 166 0.38 159 0.40
Short term 7,227 16.46 4,982 12.35
borrowings
Current portion 2,027 4.57 1,788 4.43
of non-current
liabilities
Total 10,413 23.66 7,845 19.45
Total liabilities 16,915 38.52 14,816 36.74
Total equity and 43,916 100. 40,327 100.
liabilities
Assets 2017 2017 2016 2016

Rs, million Percentage Rs, million Percentage
Non-current
assets
Property, plant 17,406 39.63 16,442 40.77
and equipment
Intangible assets 316 0.72 324 0.80
Long term 9 0.02 26 0.07

investments
Long term 372 0.85 39.64 0.66
deposits
Long term 797 1.81 1,009 2.50
advances
Total 18899 43.03 18068 44.80
Current assets
Stores, spares 746 1.70 813 2.02

and loose tools
Stock in trade 8150 18.56 7846 19.46
Page | 78
Trade debts 10728 24.43 8433 20.91
Due against 1393 3.17 1128 2.80

construction
work in Progress
Short term 846 1.93 955 2.37
advances
Short term 1109 2.53 1259 3.12
deposits and
payments
Other receivables 311 0.71 480 1.19
Short term 22 0.05 23 0.06

investments
Advance income 1228 2.80 770 1.91
tax
Cash and bank 484 1.10 552 1.37
balances
25017 56.97 22259 55.20
Total assets 43916 100. 40327 100.
Balance Sheet Analysis (assets)

30000
25000
20000
15000
10000
5000
0
2017 2016
Non-current assets Current assets
Page | 79
Vertical Analysis Profit and Loss Statement

2017 2017 2016 2016
RS. Million Percentage RS. Million Percentage
Revenue 42347 100. 34124 100.
Sales tax and (11347) (26.79) (7290) (21.36)
discount
Revenue net 31000 72.21 26834 78.64
Cost of sales (21884) (51.68) (18550) (54.36)
Gross profit 9116 21.53 8284 24.28
Other income 18 0.04 37 0.11
Distribution cost (2684) (6.34) (1628) (4.77)
Administrative (1119) (2.64) (884) (2.59)
and general
expenses
Other expenses (176) (0.42) (194) (0.57)
(3979) (9.40) (2706) (7.93)
Operating profit 5155 12.17 5616 16.46
Finance cost (1547) (3.65) (1497) (4.39)
3609 8.52 4119 12.07
Share of loss of (5) (0.01) 0 0.00
associate
Profit before 3603 8.51 4119 12.07
taxation
Taxation (295) (0.70) (34.32) (1.32)
Profit after 3308 7.81 3670 10.75
taxation
Other __ __ __ __
comprehensive
income
Total 3308 7.81 3670 10.75
comprehensive
income
Page | 80
Revenue/ Gross profiit

45000
40000
35000
30000
25000
20000
15000
10000
5000
0
2017 2016
Revenue Gross profit
Competitive analysis
Liquidity Ratios:
Current Ratio
PEL HAIER ORIENT
2017 2.41 1.1487 1.30
2016 2.83 0.947 1.25
Current ratio shows how many assets a company have to pay it’s liability in it liability is in
denominator so, it the denominator is less than it’s answer would be greater so according to
this formula the “PEL” have the more assets to meet its liabilities.
Acid Test Ratio:

PEL HAIER ORIENT
2017 1.55 0.86 0.89
2016 1.83 0,73 0.87
Page | 81
It’s also same to the current ratio and is also more conservative than the current ratio because
it exclude the inventory from the current assets because inventory can’t convert into cash
quickly so, also in this case “PEL” is more efficient than other companies.
Activity Ratios:
Account Receivable Turnover Ratio

PEL HAIER ORIENT
2017 4.51 9.39 1.85
2016 3.18 7.14 0.308
In this case “HAIER” has the greater ratio this mean that “9.39” times HAIER collect its
receivable in a year.
Inventory Turnover Ratio

PEL HAIER ORIENT
2017 2.72 5.110 3.155
2016 2.36 5.37 0.517
In this case “HAIER” has the greater ratio this mean that “5.110” times HAIER sell it
inventory in a year.
Total Assets Turnover

PEL HAIER ORIENT
2017 0.706 0.77 0.89
2016 0.665 0.66 0.15
In this case “HAIER” has the greater ratio this mean that “0.77” or each dollar amount if you
consume 1 percent of assets this will generate .77 percent of sales.
Page | 82
Profitability Ratio
PEL HAIER ORIENT
2017 0.053 0.077 0.087
2016 0.308 0.18 0.18
In this case “ORIENT” has the greater ratio.
Return on Investment
PEL HAIER ORIENT
2017 0.0753 0.0597 0.0784
2016 0.091 0.050 0.015
Return on investment show the percentage of return that we can get from the investment if its
percentage is greater this would be good in this case “ORIENT” more ROI.
Leverage Ratios:
Debt-To-Total-Assets
PEL HAIER ORIENT
2017 0.3831 0.6913 0.677
2016 0.3672 0.7133 0.7121
The debt ratio for a given company reveals whether or not it has loans and, if so, how its credit
financing compares to its assets. It higher the ratio means that higher the risk so, in this case
“PEL” has the priority than the other companies.
Page | 83
Deb-To-Equity
PEL HAIER ORIENT
2017 0.6264 2.239 2.099
2016 0.71 2.48 2.47
In it “PEL” has more efficient than the other companies. Its shows that the relation between
the debts and the shareholder equity. The less the ratio is more efficient.
Future Perspective of PEL

PEL’s Management is quiet optimistic about its future plans in terms of both business volumes
and profitability, as Company business fundamentals are intact. We believe that on finalization
of IMF support package, country economy is expected to take positive direction and your
company again will come back on its growth track.
Appliances Division
Despite of challenging environment as a result of overall economic slowdown and reduced
disposable incomes, Home Appliances Division performed well with an increase of 4.52% due
to its brand equity and diversified product range.
Our Energy efficient refrigerators based upon “Japanese Inverter Technology” and air
conditioners are popular among consumers due to product performance and aesthetics. LED
TVs launched during last quarter of the previous year is well received in the market with its
attractive latest features, outlook and cost competitiveness.
State of art manufacturing &testing facilities, effective country wide sales & after sales services
network and ongoing product R&D functions are effective strengths of the company, along
with “Human Resource Excellence”. Company is quite confident to achieve its balance nine
months plan by capitalizing on these capabilities.
Power Division
Power Division business showed a decline due to continued slow buying trends at WAPDA
distribution companies. Electricity generation gap is almost taken care of, although supply of
some projects is expected to enter in to national grid in near future. Augmentation of T&D
Infrastructure is next priority for distribution of electricity generated to end consumers and this
will raise additional demand of Power Division Products. Housing sector business growth due
Page | 84
to rapid urbanization and launching of “Naya Pakistan Housing Scheme” will also result in an
additional demand of Power Division products and EPC Business.
After passing through its initial phase by present government , WAPDA Discos buying activity
is expected to materialize and your company being “key electrical equipment manufacturer”,
is well positioned to take its due market share . We are confident to achieve our Business Plan
in balance period of the year. Further our efforts to explore the export market will also render
an incremental businesses.
Future Outlook
Implementation of latest technological trends, valuing customer feedback and responsive after
sales services are our core competencies which support Company to maintain its market
competitive position in both appliances and power sectors. We are confident that we will
achieve our Business Plans by the end of period in terms of both Sales Volumes and
Profitability.
Recommendations
 The PEL industry is should try to expand the market by exploring new areas.
 Save time by minimizing the official procedures.
 Advertise the company’s offerings to maximum extent.
 Form alliances with potential partners to strengthen the grip over market.
 Search for more suitable banks.
 Try to focus on foreign market for consideration.
 Strong focus on marketing intelligence.
 Speed up recovery procedures by using specialized methods.
 Speed up delivery process by establishing stores in areas of high demand.
 Customer service need to improve customers’ needs.
 Incentives should be given to motivate sales and recovery teams at initial stages.
 Develop proper goals and objectives for every member of team and department.
 They have raised very expensive loans so they should retire their expensive loans.
 They should carefully study their competitors.
 Their operating cost is very high so they should control their operating expenses.
 They should increase communication with their employees regarding this change
program and bring them on board.
 Whether performance appraisal discussions are held monthly, quarterly, annually
appraise should be clear about what he/she is doing right and wrong ,and how he/she
can overcome their deficiencies for the future appraisal.
 Performance appraisal should be conducted in a way that employee should
not perceive it as a fatigue or threat for their job but it should take it as an opportunity
to add or contribute more value in work of their organization.
Page | 85
 Continuously keep employees inform of the new development in the organization.

 Encourage employees to innovate without fear.
 When supervisor provide negative feedback he/she should immediately counterbalance
it with positive statement for the purpose of encouragement in that situation.
 There should be a continuous monitoring of performance. When performance deviates
from plans one does not have to wait for the next periodic review to correct it. The
supervisor and subordinate should discuss the situation immediately so the corrective
actions can be taken at once in order to avoid the major disasters.
 Training & Development Department should emphasis on communication &
presentation skills improvement along with management skills.
 Training & development at every level in the organization should be introduced.
 Change process should be made transparent and fair otherwise PEL might face
resistance in future.
Conclusion
To conclude we can say that we had a wonderful and learning experience in Pak Elektron
Limited which make possible us to write this report. In Pakistan the brand Image of Pak
Elektron limited is excellent in minds of its customers. The company has good strengths and
so it can make rapid progress in local as well as in foreign markets. In our views the
management philosophy is the main hurdle in progress of the company. Now, the company’s
focus is only profit and employer’s oriented which cause employees’ low motivation. No doubt
PEL is making excellent products, but unfortunately PEL is not realizing creative advertising
is also important part of their marketing success.
The future strategic alliances of PEL will helpful for the company to expand its technical
production capacity and also will expand the target market. We see the future of PEL very
bright as it is finding new opportunities and the company has the potential to compete with any
challenge in the market as it is in the market since an era of above 50 years.
Page | 86
References:
www.waves.net.pk
www.global.mitsubishielectric.com
www.dawlance.com.pk
ww.pakstat.gov.pk
www.finance.gov.pk
www.yahoo.com
http://www.businessmagnet.co.uk/company/pelprojectmanagement-88686.htm
http://en.wikipedia.org/wiki/PEL_(Pakistan)#Power_Division
http://en.wikipedia.org/wiki/PEL_(Pakistan)
http://www.pel.com.pk/news.html
http://www.scribd.com/doc/17607941/Managment-Pel
http://www.scribd.com/doc/17612213/Organizational-Behaviour-Pak-Elektron-Limited
https://pel.com.pk/wp-content/uploads/2018/03/PEL-Profile-of-Board-of-Directors.pdf
https://fp.brecorder.com/2018/09/20180927410753/
https://www.thenews.com.pk/print/413300-electronics-sector-reps-tell-govt-about-their-woes
https://www.theformationscompany.com/knowledge-base/starting-up-your-own-electrical-
business
https://www.pacra.com.pk/pages/best_practices/transition%20_default%20series/PEL-
Transition_Feb_12%20.
Page | 87

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Pak Elektron Limited: Change Your Life

2. Industry Analysis ......................................................................................08

4. Organizational Structure of PEL

5. Marketing Functions and Departmental Work

a. Marketing Department Hierarchy .........................................................21

Briefly discuss about the 4P’s of PEL

c. Products/ Services Offered ...................................................................22

6. Human Resource Manageent and Departmental Work

Briefly discuss about the HR practices of the PEL

a. Empolyes Recruitment and Selection ..........................................................27

Detail Analysis of marketing functions at PEL

a. Analysis of micro environment of PEL ........................................................29

8. SWOT Analysis of PEL ............................................................................35

Human Resource Management

Detail analysis of HR Functions at PEL

a. HRM Planning ..........................................................................................42

Detail Analysis of Finance Fuction at PEL

a. Finance Department Hierarchy. ..................................................................63

Overview of Pak Elektron Limited

PEL Air Conditioners

Marketing standing of PEL

PEL’s direct competitors in Appliance division

PEL’s direct competitors in Power division

Total Business Volume of PEL

PRODUCT LINES OF PEL

PEL’s Hierarchy Chart

Brief Introduction of all the Departments

Information Technology Department

Comments on the PEL’s Organizational Structure

Marketing Department Hierarchy

Number of employees in Marketing Department

MARKETING FUNCTIONS OF PEL

Products offered by PEL:

PEL Air Conditioners

Pricing strategies of PEL

Appliances Division Price Procedures

Distribution Channels used by PEL

Direct Marketing Channel

Indirect Marketing Channel

Media for Advertising

Number of Employees in HR Department

Recruitment and Selection

Recruitment and Selection Process

 Send Information to HR Department

Performance Appraisal in PEL

Compensation and Rewards

Pay For Performance

Public Pressure Groups

Macro Environment Analysis

Political & Legal Forces

Social Cultural Forces

Segmentation, Targeting, and Positioning (STP) OF PEL

Competitors’ analysis of PEL

Marketing Strategy of Dawlance

SWOT analysis of Dawlance

SWOT ANALYSIS of Orient

Market Share of Haier

Pricing Strategy of Haier