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Ready Mix Concrete Plant

KSIDC

PROJECT PROFILE
ON

READYMIX CONCRETE PLANT IN KERALA

Prepared by:

Kerala State Industrial Development Corporation

September 2012

Ready Mix Concrete Plant

KSIDC

PROJECT PROFILE FOR READY MIX CONCRETE PLANT

INTRODUCTION
Ready-Mix Concrete (RMC) is a ready-to-use concrete, with predetermined mixture of
cement, aggregates, additives and water. It is manufactured in a centrally located factory
(Batching plant) according to a set recipe or as per specifications of the client. It is then
delivered to the clients worksite, often in special trucks (Transit mixer) capable of mixing the
ingredients of the concrete en route. This results in a precise mixture, allowing specialty
concrete mixtures to be developed and implemented on construction sites.
RMC is preferred to on-site concrete mixing because of the precision of the mixture and
reduced worksite confusion. It facilitates speedy construction through programmed delivery
at site and mechanized operation with consequent economy. It also decreases labour, site
supervising cost and project time, thereby resulting in savings, proper control and economy
in the use of raw materials. It assures consistent quality through accurate computerized
control of aggregates and water as per mix designs. It minimizes cement wastage due to bulk
handling and there is no dust problem and therefore, pollution-free.
MARKET
The Ready mix concrete business in India is still in its infancy; where as in developed
countries, nearly 80% of cement consumption is in the form of ready mix concrete and 20% in
the form of recast. In India, ready mix concrete accounts for less than 5% of consumption,
and as much as 82% of cement consumption is in the form of site-mixed concrete. While 70%
of cement produced in a developed country like Japan is used by RMC business, in India,
only around 2% of total cement production is used by RMC.
The growth of RMC in India was predominantly driven by demand from metros (Tier-1) and
Tier-2 cities. But now, since the focus has shifted to Tier-3 & 4 cities, the demand for RMC
has shown steady increase. Anticipating huge potential for the product, cement majors,
including Associated Cement Companies, Grasim, L&T, India Cements, Priyadarsini
Cements, Chettinad Cement and Madras Cements, have forayed into the RMC business and
the share of RMC is expected to go up from present levels of around 5% of the total cement
production to the global average of 70%, according to industry players.

Ready Mix Concrete Plant

KSIDC

PROJECT PARAMETERS
Capacity
The production capacity of a Ready-Mix Concrete Plant varies according to the capacity of
the Batching Plant used. Most commonly used RMC Plants will be having a production
capacity of 30 m3/hr (90,000 m3/year, based on 300 working days and single shift of 10
hours).
Land
An extent of around 1 acre of dry land is required for setting up a Ready-Mix Concrete Plant.

Location

The project is proposed to be located at Kochi.


Raw Material & Utilities
The Raw materials that go into production of concrete are Cement, Aggregates (Sand &
Metal), Additives and Water. M20 grade concrete is the most widely used, where the
Cement/Sand/Metal/Water mix is in the ratio of 1 : 1.5 : 3.5 : 0.5. Since uninterrupted
availability of raw materials is the most fundamental success factor for any RMC Plant,
options for backward integration (quarry/ metal crushing unit/cement plant/clinker
grinding unit) should be carefully considered and analysed while choosing the Plant
location.
Plant & Machinery
The main items of mechanical equipment involved in the ready-mix concrete manufacture
are the Concrete Batching Plant, Transit Mixer and Concrete Pump. M/s. Schwing Stetter
India (P) Ltd is the leading supplier of RMC equipments in the country. The total cost of
machinery for a 30m3/hr RMC Plant is around Rs.200 Lakhs.
Manpower
The total manpower requirement for a typical RMC Plant would be around 20 numbers.
Cost of the Project
The total project cost for setting up a 30m3/hr RMC Plant would be around Rs.400 Lakhs,
including cost of 1 acre land. The project implementation period would be 12 months.

Ready Mix Concrete Plant

KSIDC

Means of Finance

The proposed means of Finance for the Project is given below:


Equity
Promoters contribution
Unsecured Loan
Term Loan
KSIDC/KFC/Banks/FIs
Total Project Cost

180.00
20.00
200.00
400.00

The Debt-Equity ratio is 1:1.


Sales Turnover
The Revenue at optimum utilisation (80%) would be around Rs. 3888 Lakhs.
FINANCIAL INDICATORS

The Profit after Tax is Rs.123 Lakhs.


The Break Even Point (BEP) for the project is 58%.
The Debt Equity Ratio (DER) for the project is 1:1
Average Debt Service Coverage Ratio (DSCR) is 3.78
The average Internal Rate of Return (IRR) for the project is 28.68%.

CONCLUSION
Ready Mix Concrete is a modern technique of production of concrete in large quantities
away from the actual site of placing. It is very useful in cities where demand of concrete is
very high and construction sites are in congested areas, where mixing on site is not possible.
The Supervisory and labour costs associated with production of RMC is less, and the quality
of concrete is high. It is suitable for huge industrial and residential projects where time plays
a vital role.

For further details please contact Kerala State Industrial Development Corporation Ltd.

Ready Mix Concrete Plant

Disclaimer:

KSIDC

The findings contained in this Project Profile are based on the initial information collated through primary and secondary
research, which is indicative in nature. Reference herein to any specific commercial product, process, service by trade name,
trademark, manufacturer, or otherwise, does not constitute or imply its endorsement, recommendation, or favoring by
KSIDC or any entities thereof.

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