MINI TOOL ROOM

PRODUCT CODE

359960313

QUALITY AND STANDARDS

Tool room facility/Machine shop is a

servicing industry to cater the tooling needs
such as jigs, fixture, press tools, die sets,
forming tools and moulds etc, to other
industrial units as per their products. Every
tool produced in the tool room requires
100% of inspection to adhere to the
drawing, design and specifications of the
user industry. Wherever necessary relevant
IS: Specifications are to be followed in
selecting the tool material and tolerances in
the production of components of the tooling
to be produces.

PRODUCTION CAPACITY
S.No.

Item

Qty.

Rate

Value (Rs.)

1.

Sheet metal dies.

600 Nos.

Rs. 20,000

1,20,00,000

2.

Plastic injection moulding dies.

600 Nos.

Rs. 12,000

72,00,000

3.

Bakelite moulding dies.

600 Nos.

Rs. 8,000

48,00,000

4.

Job work

L.S.

L.S.

5,00,000

5.

Sale of Scrape

L.S.

L.S.

1,00,000

Total
MONTH AND YEAR
OF PREPARATION

May, 2014

PREPARED BY

Sh. Kamal Singh

Deputy Director (Mechanical)

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2,46,00,000

Mini Tool Room

1. INTRODUCTION
Tool room facility is a necessity for production of tooling in all disciplines of
engineering industry whether mechanical, electrical, and electronic or plastics, etc
with the rapid industrialization in our country. It has become imperative to produce
various tools on job work basis e.g.
i.

Jigs & fixtures

ii.

Press tools

iii.

Forming tools

iv.

Moulding dies

v.

Forging dies

2. MARKET POTENTIAL
The tool room serves as a backbone to a number of SSI Units situated in any
area. The demand for a tool room depends directly on the growth of other units.
Wherever there is concentration of more than 100 SSI Units, a tool room of this size
will be viable. The decision to set up a tool room facility can be taken, keeping in
view an action plan of the area and growth of existing units.

3. BASIS AND PRESUMPTIONS

i.

The project profile has been prepared on the basis of single shift of 8 hours a
day. 25 days in a month and at 75% efficiency.

ii.

It is presumed that in the first year, the capacity utilization will be 70% and
followed by 85% in the next year and 100% in the subsequent years.

iii.

The rates quoted in respect of salary and wages for skilled workers and others
are above the minimum rates in other states.

iv.

Interest rate for fixed and working capital has been taken at 15% on an
average, whether by bankers and or financial corporation.

v.

Margin money required is minimum 30% of the promoters.

vi.

The rental value of the work has been taken at the rate of Rs. 100 per square
meter approx.

vii.

After the initial gestation period of one a half year. It will require seven years
to pay back the loans

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Mechanical Division

4. IMPLEMENTATION SCHEDULE
i.

ii.
iii.
iv.
v.
vi.
vii.
viii.

Preparation of project report:

a) Inviting quotation
b) Preparation
Provisional registration
Financial arrangements
Purchase of machinery
installation of machinery
Installation of machinery
Electrification
Recruitment of manpower
Total time Taken

1 month
month
month
1 month
2 months
2 months
1 month
1 month
1 month
9 months

5. TECHNICAL ASPECTS
1. In the tool room various machine tools including EDM facilities have been
provided to carry out various machining operations e.g. hacksaw wing,
drilling, turning, shaping, milling, surface grinding, and cylindrical grinding
to produce different parts/components of a tool. However, heat treatment
facilities will be availed from outside as the same is not economical for this
size of tool room.
2. The quality of the tools produces will be 100% inspected conforming to
drawing and specification of the user industries, wherever possible is
Specifications for tolerances and standard parts will be used to meet the
requirements.
3. Production capacity in term of machine hours is available as the products
tooling cannot be specified except types as mentioned above in the
introduction.
4. Approximate motive power has been given against each machine to the
installed. The total horsepower comes to 50 H.P.
5. Rate of interest is taken @ 15% in the report.
6. Pollution control needs: The tool room workshop is equipped with machine
tools only for doing job works like machining of ferrous metals to make
different types of tooling and there will also be no discharge of effluents.
There will be no chance of pollution and hence no pollution control
equipment is required.
7. Energy conservation: The machine tools provided in the scheme are
individually motorized. The motive power of each motor is according to the
requirement of each for proper performance.

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Mini Tool Room

6. FINANCIAL ASPECT
6.1. Fixed Capital
Building: Built up workshop shed, Covered area of 500 sq. mtrs. on Rent.

6.1.1. Machinery and Equipments

a)

Production Unit:
1.

Surfacing, sliding and screw cutting Precision

lathe machine cap. 1500 mm. Bedx400 mm swing
x 40 mm, Bore motorized with 3 HP Motor &
Electrical complete with standard Accessories i.e.
face place, steady and with one 250 mm 4 jaw
chuck and One 200 mm true chuck (3 jaws) and
tool Holders etc of graded quality.

1 Nos.

Rs. 10,00,000

2.

24 stroke shaping machine with 3 HP Electric

motor & electrical

1 No.

Rs. 50,000

3.

Power hacksaw machine cutting capacity 7 dia

with 1 HP motor and starter

1 No.

Rs. 20,000

4.

Bench type capacity drill Machine with HP

Motor and Starter

1 No.

Rs.

5.

MTR Vertical Milling with 2 HP Motor &

Accessories

1 No.

Rs. 6,00,000

6.

Surface grinding machine 16x8 with 2 HP

Motor & Starter

2 No.

Rs. 3,00,000

7.

Cylindrical grinding machine Cap, 150x500mm,

with internal Attachment with 2 HP main motor
HP internal grinding motor and HP spindle
driving motor and starter

2 No.

Rs. 3,00,000

8.

Double ended bench type 10 dia wheel Grinder

motorized with 1 HP motor & starter

1 No.

Rs. 10,000

9.

EDM Spark Erosion Machine Table size 20

cmx30cm with 7.5 HP Load

1 No.

Rs. 5,00,000

10

CNC milling Machine with all accessories

1 No.

Rs. 25,00,000

Total

Rs. 52,87,500

Installation & Electrification Charges @ 10 %

Rs. 5,28,750
Total

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7,500

Rs. 58,16,250

Mechanical Division
b)

Testing Equipments:
1.

Rockwell Hardness Tester

1 No.

Rs. 50,000

2.

Profile Projector

1 No.

Rs. 3,00,000

Installation & Electrification Charges

L.S.

Rs. 35,000

Total

Rs. 3,85,000

c)

Measuring Instruments:
1.

Surface plate 600x600

1 No.

Rs. 50, 000

2.

12 Vernier height gauge

1 No.

Rs. 12,000

3.

Vernier Caliper 200 mm

1 No.

Rs. 3000

4.

Vernier caliper 300 mm

1 No.

Rs. 4000

5.

Micrometer 0.25 mm

1 No.

Rs. 3000

6.

Micrometer 0.50 mm

1 No.

Rs. 3500

7.

Inside Micrometer 0.20

1 Set

Rs. 25,000

8.

41 pcs slip gauges set

1 Set

Rs. 50,000

9.

Combination set consisting of right angle bevel

protector and center head and 12 scale

1 Set

Rs. 20,000

10.

Dial vernier caliper

1 No.

Rs. 7500

11.

Misc. marking instruments and vices etc.

L.S.

Rs. 50,000

Total

Rs. 2,28,000

L.S.

Rs. 3,00,000

Initial Purchase of non-recurring type cutting tools

Total cost of machinery & equipments
d)

Rs. 67,29,250

Office Equipments:
1.

Computer with Design software

1 No.

Rs. 1,50,000

2.

Office table

2 Nos.

Rs. 15,000

3.

Chairs

5 Nos.

Rs. 10,000

4.

Almirah

2 Nos.

Rs. 20,000

5.

Working tables & stools

3 Nos.

Rs. 10,000

6.

Fixtures etc.

L.S.

Rs. 10,000

Total

Rs. 2,15,000

Total cost of machinery, equipments and office equipments

Rs. 69,44,250

Pre-operative expenses i.e. project cost and Non-refundable

deposits etc.

Rs. 1,50,000
Total Rs. 70,94,250

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Mini Tool Room

6.2. Working Capital (per month)

6.2.1. Building
Building (on rent)

(Rs.)

Built up workshop shed, Covered area of 500 sq. mtrs.

@ Rs. 100 per sq. mtr.

50,000

6.2.2. Personnel
S. No.

Designation

Nos.

Salary (Rs.)

Total (Rs.)

1.

Manager

01

20,000

20,000

2.

Designer-Cum-Engineer

01

15,000

15,000

3.

Accountant/Storekeeper

01

7500

7,500

4.

Supervisor

02

12,000

24,000

5.

Clerk-Cum-Typist

01

7,500

7,500

6.

Skilled Workers

03

10,000

30,000

7.

Semi-Skilled Worker

04

7,500

30,000

8.

Die fitters

02

7,500

15,000

9.

Helpers

03

6,000

18,000

10.

Peon/Chowkidar

01

6,000

6,000

Total

1,73,000

Perquisites @ 15% of salary

26,000

Total

1,99,000

6.2.3. Raw Material

Die steels assorted size 5000 kg @ Rs. 200 per kg.
Mild sheets assorted size: 2500 kg @ Rs. 60 per kg.

Total

Rs. 10,00,000
Rs. 1,50,000

Rs. 11,50,000

6.2.4. Utilities
Power 1500 KWH Units @ Rs. 5/-

Rs. 7,500

Water L.S.

Rs. 300

Total

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Rs. 7,800

Mechanical Division

6.2.5. Other Contingent Expenses (per month)

1.
2.
3.
4.
5.
6.
7.
8.
9.

Postage & Stationery

Telephone
Consumable store, Waste Cotton,
Lubricants, Cutting tools, grinding Wheels, etc.
Repairs & Maintenance
Transport Charges
Advertisement & Publicity
Taxes
Sales Expenses
Misc. expenses including heat treatment
charges to outside units
Total

Rs. 2000
Rs. 1000
Rs. 20,000
Rs. 20,000
Rs. 10,000
Rs. 10,000
Rs. 3,000
Rs. 5000
Rs. 25,000
Rs. 96,000

6.2.6. Total Recurring Expenditure (per month)

1.

Rent

Rs. 50,000

2.

Personnel

Rs. 1,99,000

3.

Raw Material

Rs. 11,50,000

4.

Utilities

Rs. 7,800

5.

Other contingent Expenses

Rs. 96,000

Total

Rs. 15,02,800

Total Working Capital for 3 months

Rs. 45,08,400

6.3. Total Capital Investment

Total Fixed Capital

Rs. 70,94,250

Total Working Capital (for 3 months)

Rs. 45,08,400

Total

Rs. 1,16,02,650

Machinery Utilization
This project profile is for tool room facility (medium size). It is expected that
in 1st year 70%, 2nd year 85% and third year 100% machines will be utilized at 75%
efficiency. No provision has been made in respect of heat treatment facilities, which
are to be out sourced. This is necessary as the HT Equipment cannot be economically
viable for this size of tool room.

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Mini Tool Room

7. FINANCIAL ANALYSIS
7.1. Cost of Production (per annum)
1.

Total recurring cost

Rs. 1,80,33,600

2.

Depreciation of machinery & equipment including

Testing machines @ 10%

Rs. 5,28,750

Depreciation on measuring & marking instruments

and cutting tools etc. @ 20%

Rs. 1,82,600

4.

Depreciation on office equipments @ 20%

Rs. 43,000

5.

Interest on total capital investment @ 15%

Rs. 17,40,398

3.

Total

Rs. 2,05,28,348

Say

Rs. 2,05,28,000

7.2. Turnover (per annum)

S. No.

Item.

Qty.

Rate

Value (Rs.)

1.

Sheet metal dies.

600 Nos.

Rs. 20,000

1,20,00,000

2.

Plastic injection moulding dies.

600 Nos.

Rs. 12,000

72,00,000

3.

Bakelite moulding dies.

600 Nos.

Rs. 8,000

48,00,000

4.

Job work

L.S.

L.S.

5,00,000

5.

Sale of Scrape

L.S.

L.S.

1,00,000

Total

7.3. Net Profit (per annum)

=

Turnover cost of production

Rs. 2,46,00,000 - 2,05,28,000

Rs. 40,72,000

7.4. Net Profit Ratio

=

Net profit per year

X 100
Turnover per year

40,72,000
X 100
2,46,00,000

= 16.6 %

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2,46,00,000

Mechanical Division

7.5. Rate of Return

=

Net profit per year

X 100
Total Capital Investment

40,72,000
X 100
1,16,02,650

= 35.1 %

7.6. Break-even Point

Fixed Cost (Per Annum)
1. Total depreciation
2. Rent
3. Interest
4. 40% of salaries
5. 40% of other expenses
Total

Rs. 7,54,350
Rs. 6,00,000
Rs. 17,40,398
Rs. 9,55,200
Rs. 4,60,800
Rs. 45,10,748

B.E.P
=

Fixed Cost
X 100
Fixed Cost + Net Profit

45,10,748
X 100
45,10,748 + 40,72,000

= 52.6 %

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Mini Tool Room

Address of Suppliers of Machines:
1.

M/s H.M.T. Bangalore

2.

M/s Addison & Co. Madras.

3.

M/s Cooper Engg. Works, Chuchawad, Poon

4.

M/s Perfect Machine Tools (P) ltd. Bell Building Sir P.M. Road Bombay

5.

M/s Leading Engg. Co., 31, New Rohtak road, New Delhi

6.

M/s Daulat Industries Corpn. Pvt. Ltd, Civil Lines, Ludhiana.

7.

M/s. R.K. Machine Toos, Indl. Area-A, Ludhiana.

8.

M/s Sagar Engg. Works, Indl. Area-B, Ludhiana

9.

M/s Ashoka Bros., Panchkuian Road, New Delhi.

10. M/s Internation Machine Tools Corporation, 5, Park Street, Behind State
Bank of India, for, Bombay.

Address of Suppliers of Raw Materials:

1.

M/s Radhi & sons, 82, Nagdevi Cross Lane, Bombay.

2.

M/s Durga Mill Store, Miller Gnaj, Ludhiana

3.

M/s Victor Steels Pvt. Ltd., Sirkiwalan Bazar, Delhi.

4.

M/s B.K. Steel, Ludhiana

5.

M/s. B.K. Steel, Ludhiana

6.

M/s. New India Steel Engg. Co., Bank of India Building, 185, Sheikh
Memun Street, Bombay.

7.

M/s Excel Steel Corporation, 162, Nagdevi Street, Bombay.

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