UPDATED PROJECT PROFILE

Cold Storage Unit

1.

PRODUCT CODE

Nil

2.

MONTH AND YEAR OF

MARCH, 2012

MSME Development Institute

(Mechanical Division)
CGO Complex,
C Block,
Seminary Hills,
NAGPUR-440 006.
Ph. 2510046, 2510352.
Telefax: 0712-2511985

UPDATED
3.

PREPARED BY

E-mail:dcdi-nagpur@dcmsme.gov.in

..

UPDATED PROJECT PROFILE

COLD STORAGE UNIT
1. INTRODUCTION.
India is the largest producer of fruits and second largest producer of
vegetables in the world. In spite of that per capita availability of fruits and vegetables
is quite low because of post harvest losses which account for about 25% to 30% of
production. Besides, quality of a sizable quantity of produce also deteriorates by the
time it reaches the consumer. This is mainly because of perishable nature of the
produce which requires a cold chain arrangement to maintain the quality and extend
the self-life if consumption is not meant immediately after harvest. In the absence of a
cold storage and related cold chain facilities, the farmers are being forced to sell their
produce immediately after harvest which results in low price realization. Sometime
farmers do not even get their harvesting and transportation costs what to talk of the
cost of production or profit. As a result, our production is not getting stabilized and
the farmers after burning fingers in one crop switch over to another crop in the
subsequent year and the vicious cycle continues. Our farmers continue to remain poor
even though they take risk of cultivating high value fruits and vegetable crops year
after year. A cold storage facility accessible to them will go a long way in removing
the risk of distress sale to ensure better returns. This project profile endeavors to
provide information on various broad technical and financial aspects of a cold storage
unit to enable the financing banks and entrepreneurs in formulation and
implementation such projects.
2. MARKET POTENTIAL.
The estimated annual production of fruits and vegetables in the country
is about 130 million tonnes. This accounts for 18% of our agricultural output. Due to
diverse agro climatic conditions and better availability of package of practices, the
production is gradually rising. Although, there is a vast scope for increasing the
production, the lack of cold storage and cold chain facilities are becoming major
bottlenecks in tapping the potential. The cold storage facilities now available are mostly
for a single commodity like potato, orange, apple, grapes, flowers, etc. which results in
poor capacity utilization.
Present availability of cold storage capacity is only 130.5 lakh tonnes.
Although 90% of these units are made to store only potato even then it does not meet the
requirement of the single crop, the production of which is about 300 lakh tones per
annum.
3. BASIS AND PREASSUMPTIONS.
Assumptions for working out economics of a 5000 MT capacity potato cold storage
1. 70% of the capacity is rented out and rest 30% capacity is used to store potato
owned by the promoter(s).
2. Rental charges per season per MT of potato are Rs. 1800/-.
3. Marketing margin on own potato considered at Rs. 6500/- per MT.
4. Electricity and other utilities expenses at Rs. 410.4/- per MT per annum.
5. Insurance charges for the potato considered as Rs. 40/- per MT per season.
6. Margin money considered at 25% of the financial outlay.
7. Interest on term loan considered at 15% per annum.

8. Even though the life of the cold storage will be much more, the life has been
considered as 15 years for working out internal rate of return.
9. Depreciation rate of 5% and 9% has been considered for civil structures and plant
& respectively.
4. IMPLEMENTATION SCHEDULE.
1. Provisional registration with the Director of industries (DIC) one week.
2. Site selection, Land development, Power connection, Water Connection &
Construction of Building 12 months.
3. Purchasing machinery, equipments and employing personnel 02 month.
4. Installation of machinery 02 months
5. Testing installed machinery & Marketing 01 month.
The proposed unit can be set up in 18 Months.
5. TECHNICAL ASPECTS.
5.1 Process of Service / Manufacturing.
After harvesting potato transport it to cold storage premises then pre cool it in precooler
remove damaged potatoes then pack in certain quantity like 50Kg, 100 Kg bags, number
bags and store in cold storage racks. Maintain constant cooling whenever potato /
products are in storage, frequent inspection of stored product is required. Transport to
wholesale market whenever required.
5.2 Quality Specifications.
Constant continuous cooling, security of product, perfect service is essential.
5.3 Service Capacity per Season /Annum.
Quantity: 5000 MT of Potatoes
Value : 1,60,50,000 Rs
5.4 Motive Power. Three phase, 75 HP (For Vapor Compression Refrigeration System)
6. TOTAL CAPITAL INVESTMENT.
Sr.
Description
No.
1.
Fixed Capital
2.
Working Capital (3 times of WC/ Month)

Value Rs.

Total Cost

7. MEANS OF FINANCE.
1. Promoters Contribution (25 % of Total Cost)
2. Bank Loan (Total Cost - Promoters Contribution )
8. FINANCIAL ASPECTS.
8.1 FIXED CAPITAL.
Sr.
Description
No.
1.
Civil cost
2.
Insulation cost
3.
Machinery & Equipment cost
4.
Miscellaneous cost

Cost / MT
(Rs)
3200.00
900.00
1500.00
200.00
Total Fixed Cost

29000000.00
752856.00
2,97,52,856.00
Say
3,00,00,000

Rs.
75.00,000.00
2,25,00,000.00

Value
(Rs)
16000000.00
4500000.00
75,00,000.00
10,00,000.00
2,90,00,000.00

8.2 WORKING CAPITAL.

Sr.
No.
1.
2.
3.
4.

Sr.
No.
1.
2.
3.
4.
5.
6.

Sr.
No.
1.
2.

8.2.1 Establishment Expenses per Month & Year.

Designation
Persons
Salary
(Rs / Month)
Manager
1
15000.00
Supervisor
1
10000.00
Skilled worker
2
6000.00
Labors/ helpers for loading, unloading
5
3500.00
product & other related work
Total Cost for Staff & Labor
34500.00

5.

Sr.
No.
1.
2.
3.
4.

6,54,000.00

8.2.2 Maintenance & Repair Expenses per Month & Year.

Description
Quantity
M&R Expenses
Value
Per Month
(Rs/Month)
(Rs/Year)
Refrigerant (NH3 )
30 Kg
7084.00
85000.00
Lubricants
10 Lit.
2000.00
24000.00
Fuel
06 Lit.
500.00
6000.00
Preventive maintenance cost
6250.00
75000.00
Parts to Replace
6250.00
75000.00
Repairing expenses
4167.00
50000.00
Total M & R Expenses
26251.00
3,15,000.00

8.2.3 Utilities per Month & Year.

Description
Units
Power (125 KW @ 5 )
Water

34000
Total Utilities

Sr.
No.
1.
2.
3.
4.

Value
(Rs/Year)
180,000.00
120,000.00
144,000.00
210,000.00

Bill
(Rs / Month)
170000.00
1000.00
171,000.00

8.2.4 Other Expenses per Month & Year.

Description
Expenses
(Rs / Month)
Insurance charges of stored product / potato
16667.00
Postage & Stationary
500.00
Conveyance and Transport
1000.00
Advertisement & Publicity
834.00
(Stickers , pamphlets & Cards )
Other Unforeseen Expenses
200.00
Total other Expenses
19201.00
8.2.5 Total Working Capital Per Month.
Description
Total Establishment Expenses per Month
Total Maintenance & Repair Expenses per Month
Total Utility (Power & Water Expenses) per Month
Total Other (Insurance, Marketing etc)Expenses Per Month
Total Working Capital Per Month

Value
(Rs/Year)
2040000.00
12000.00
20,52,000.00

Value
(Rs/Year)
200000.00
6000.00
12000.00
10000.00
2400.00
230400.00

Value Rs
34500.00
26251.00
171000.00
19201.00
2,50,952.00

9. COST OF PRODUCTION / SERVICE PER ANNUM.

Sr.
No.
1.
2.
3.

Description

Value Rs

Total Working Capital Per Annum

Depreciation on Machinery & Equipment
Interest on total capital investment (FC+WC)
Total Cost of Servicing Per Annum

30,11,424.00
6,75,000.00
44,62,928.00
81,49,352.00

10. TURNOVER PER YEAR.

Sr.
Description
Quantity
Rate
Value
No.
(MT)
(Rs /MT)
(Rs)
1.
70 % capacity of cold storage is rented
3500
1800.00
63,00,000.00
2.
30% capacity of cold storage is used to
1500
6500.00
9750000.00
store potato owned by promoter(s)
Total revenue per year
1,60,50,000.00
11. FIXED COST PER YEAR.
Sr.
Description
No
1.
Depreciation of Machinery, equipment & Insulation
(At the rate 9% / Year in average)
2.
Depreciation of civil structure (At the rate 5% / Year )
3.
Interest
4.
40 % of Salaries & Wages
5.
40 % of Other Expenses (Utilities + OE)
Total Fixed Cost per
year

Value Rs
10,80,000.00
8,00,000.00
44,62,928.00
2,61,6000.00
9,12,960.00
75,17,488.00

12. PROFIT ANALYSIS.

Profit : Revenue per year-Total Cost of Servicing Per Annum : 79,00,648.00 Rs
Income Tax on Profit @ 30%
: 23,70,194.00 Rs
Net Profit (PAT)
: 55,30,453.00 Rs
% of Profit on Sale : Net Profit / Sale 100
: 34.46 %
% of Return on Investment : Net Profit / (FC + WC) 100
: 17.28 %
13. MACHINERY SUPPLIERS.
1. RINAC INDIA Ltd., No.5, Saraswati Niwas,Main Channal Road, Saraswathipuram
Ulsoor, Banglore-560008 (Karnataka) PH- 080-41132929
2. AIRTECH ENGINEERS, B-93, Okhala Industrial Area, Phase II, New Delhi
-110020, PH- 011-26385711
3. NEER ENTERPRISES,
232/2,Mangal Nagar, Opp. Saraswati Vidya Mandir, Near Shastri Nagar, N.H. No. 8
Rakhial, Ahmedabad-380023, Gujarat, India. Phone : +91-79-22910062,
22910326 Fax : +91-79-22910393 E-Mail: info@neerenterprises.com
Ctd...

14. DOS AND DON'TS

Dos

Don'ts

Suitability of site with proper elevation,

drainage and linkages by road and
other communications must be ensured.

Site in a low lying area with poor road

and other communication linkages
must be avoided.

Land should be converted to non

agricultural category.

Agricultural land should not be used for

construction of cold storage without
converting it to non agricultural
category.

Soil should be tested for its load bearing

strength and matching rack design
should be adopted.

Do not avoid soil load bearing test and

proper rack design.

Necessary permission from local

authorities for construction of cold
storage should be obtained.

Don't avoid taking permissions from

local authorities for constructions.

Capacity of the plant and its room

temperature should be matched to the
product to be stored and market size.

Don't select the capacity of the cold

storage arbitrarily.

Selection of technology and machinery

should be for power efficiency, low
investment and maintenance cost.

Costly and energy intensive technology

should be avoided.

Plant operation may be planned in a

manner to not exceed an average 12
hours operation a day.

Plant operation for more than 12 hours

a day should be avoided.

Refrigeration system should be properly

pressure tested and vacuum tested for
safety.

Proper pressure testing and vacuum

testing of the refrigeration system
should not be over looked.

Soft water should be used for plant

operation.

Don't use hard water without softening

it.

10

Trained personnel should be employed

for operating the plant and maintaining
desired room conditions.

Untrained and inexperienced

personnel should be avoided for critical
plant operations.

11

Proper standby equipment like

compressor with motor and water
circulation pump should be provided.

Standby provisions for critical

equipment should not be avoided to
save on cost.

12

Assured electricity supply matching to

the electrical power requirement should
be provided. In case of power failures,
the supply should be ensured by DG set
matching to the essential power
requirement of the unit.

Don't compromise on DG set to ensure

assured power supply.

13

Proper safety provisions like fire

extinguishers and safety alarms should
be provided.

Don't compromise on safety aspects

for risk free operation of the unit.

14

Proper insurance cover should be taken

for building, plant and machinery and
stored stocks to take care of unforeseen
risk.

Don't avoid insurance cover to save on

operational costs.

UPDATED PROJECT PROFILE

Explosive Van Body Building

1.

PRODUCT CODE

Nil

2.

QUALITY & STANDARDS :

The quality specification of

the Explosive van depends
upon Explosives Rules of
Department of Explosives,
Govt. of India and RTO.

3.

MONTH AND YEAR OF

MARCH, 2012

MSME Development Institute

(Mechanical Division)
CGO Complex,
C Block,
Seminary Hills,
NAGPUR-440 006.
Ph. 2510046, 2510352.
Telefax: 0712-2511985

UPDATED
5.

PREPARED BY

E-mail:dcdi-nagpur@dcmsme.gov.in

..

UPDATED PROJECT PROFILE

Explosive Van Body Building

Introduction:

1.

Explosive van carries explosives , which were mounted on different vehicles

chassis such as on Ashok layland, TATA or Swaraj Mazda. These van are having
different carrying capacity such as 1 MT, 3 MT, 5MT, 10 MT & 15 MT. These are
fabricated as per Govt. of India, Department of Explosive rules. This project profile is
prepared for caring Class-2 type of explosive.

Explosive Rules, 1983

Explosives Rules deal with condensed explosives like high explosives (dynamite,
detonators etc. ) fireworks, low explosives ( safety fuse etc. ) The type of explosives
have been catogarised as category X,Y, Z, and ZZ and for various purposes, either
licence or approval is required.
Licence is required for manufacture, storage, ( possession ) for sale and/or use,
transport, import, export of explosives, display of fireworks or for special purpose not
covered in the Rules. The details regarding Shot Firers permit have been stated in
Licensed Premises.
Approval is required for manufacture of portable Magazine, Explosives Carrying
Boxes, Authorisation of Explosives, Issue of Foreman Certificate, Acetylene Generator
and BMD system.
Form no
Form 26

2.

Purpose
To Transport Explosive

Licensing Authority
Controller of Explosives

Market Potential:

There are numbers of ordnance factories, Explosives manufacturing units

fire crackers manufacturing units. The explosives vans are essential explosive material
handling vehicles for transportation of explosives from one destination to other. Most
of the units they hire the vans for transport. Therefore the market potential of explosive
van body building and repair is highly demanded.

3.

Pre assumptions:

i)

Interest on fixed capital and working capital has been calculated at an average
rate of 15% per annum.
The present schemes have been worked out on single shift working of 8 hours per
day at a 80% of efficiency and 300 working days in an year.
The rate in respect of machinery equipments cost of land and building, raw
materials are as per prevailing market rates at the time of preparation of this
project profile and are likely to vary quality wise and capacity wise from supplier
to supplier and place to place.
Arrangements of labour wages has been made as per the prevailing market rates
which may vary from place to place.
The unit can function in rented premises as the manufacturing activity does not
involve any special constructional features for the premises.
Fabrication of Explosive van of capacity 10 MT to carry only class-2
Explosives is considered for project profile preparation.

ii)
iii)

iv)
v)
vi)

4.

Implementation Schedule:
Every project requires some specific time for commercial
are briefly as under.
Selection of product and procurement of technical Know-how
Selection of industrial site
Provisional registration
Preparation of project report
(a)
Calling quotations
(b)
Preparation of reports
Application for finance and getting loan sanctioned
Recruitment of man-power
Procurement, installation & electrification
of machineries
Trial run

production and
6 weeks
2 weeks
1 week
4 weeks
2 weeks
10 weeks
2 weeks
8 weeks
1 week

In between the financial exercise and installation of machinery, labour

requirement and other miscellaneous work will be completed for manufacturing
the product.

5.

Technical Aspects:

Class 2 Explosive Nitrate Mixture Class

Nitrate-mixture means any preparation, other than gunpowder which is formed by the
mechanical mixture of a nitrate with any form of carbon or with any carbonaceous
substance not possessed of explosives properties, whether Sulphur be or be not added to
such preparation, and whether such preparation be or be not mechanically mixed with any
other non-explosive substance, and includes any explosive containing a perchlorate and
not being a chlorate-mixture, fulminate or nitro-compound as defined in this Schedule.
9

(a)
i)

MANUFACTURING PROCESS:

The following point must be noted while body building of Explosive van:
1. Disconnect all connection of battery and alternator before electric welding work
on chasses / body.
2. Exhaust silencer is to be install in between front wheel & back compartment
body, spark arrester is to be fitted at the end of silencer. For short circuit
precaution earthing chain and cutout switch is to be installed.
3. There should be gap between drivers cabin and back storage compartment.
4. The inner wall of compartment is to be lined by aluminum and fabricated by brass
screw.

FLOW CHART OF BODY BUILDING OF EXPLOSIVE VAN

Purchase of Raw Material like

Aluminum sheet, wood, angles,
pipes & hardware items

Bending of pipes cutting of

wood

Erection & Fabrication of

pipes, packing wooden
planks and bolts.

Welding, Riveting and

fabrication

Sent for passing to RTO and

Explosive Dept.

Completion and painting

Delivery to customer

(b)

QUALITY CONRTOL AND STANDARDS:

The fabrication of Explosives van cabin/ body construction should followed
with the specification under schedule to Explosives Rule 1983.

6.

Production Capacity :
It is proposed to build body of 24 Explosives vans of capacity 10 MT per annum
i.e. two vans per month

10

7.

Pollution Control Measures:

The manufacturing activities of the unit do not produce any waste or
effluents which may require pollution control measures.

8.

Financial Aspects:
(i)

LAND AND BUILDING

Rented shed with floor
area of 200 sq. mtr.

(ii)
Sr.
No.
1.

Rs . 15000/- PM

MACHINERY AND EQUIPMENT:

Indigenous/
Imported
Ind.

1 set

-do-do-

1
1

60000
25000

-do-

12000

-do-do-do-

1
1
1

12000
6000
60000

8.

Double end bench grinder

8 wheel dia.
Electrical portable shear machine
Universal hand shearing machine.
Bending machine
Hand operated
Air compressor 5 HP

-do-

40000

9.
10.

Electric portable drilling machine

Spray gun

-do-do-

1
1

6000
5000

11.

Power hacksaw machine

-do-

30000

Sub total

296000
30000

2.
3.
4.
5.
6.
7.

Description
Arc welding Transformer 3 phase,
oil cooled
TIG welding equipments 500 Amp.
Portable spot welding gun

Electrification
&
installation
charges @ 10% of cost of
LS
machinery & equipment
Total cost of machinery & equipments
Cost of dies, tools, handling
equipment
and
measuring
LS
instruments
Cost of office equipment/working
table/furniture
LS
Pre-operative expenses (Project cost
non-refundable deposits, if any)
LS
Total fixed Capital:

11

Qty

Price
(Rs.)
40000

50000

25000
25000
426000

(iii) WORKING CAPITAL (PER MONTH)

A.

STAFF AND LABOUR

Sr. No.
1.
2.
3.
4.
5.
6.
7.

B.

Designation
Manager
Accountant
Clerk cum storekeeper
Welder
Fitter
Helpers
Peon/chowkidar
Perquisites @ 15% of salaries
Total:

No.
1
1
1
1
2
1
1

Salary
10000
6000
5000
4000
4000
3000
3000

Total (Rs.)
10000
6000
5000
4000
8000
3000
3000
5850
44850
Say 45000

RAW MATERIAL (PER MONTH):

Particular

Ind/Imp.

Qty.

Rate
Rs
245/per Kgs

Value
(Rs.)
98000

Aluminum sheet
22SWG to 20 SWG
4X6=24 sq ft/ sheet. One
sheet = 7 KG approx.
Rolled steel angle
35X35X5 mm, 2.6 Kgs
/mtr
Square pipe
40X40 mm, 5mm
thickness, 18 each
Channel
40X40X40 mm, 5mm
thickness,
Brass sheet, brass screw,
paint,
spark
arrester,
cutout switches, earthing
chain, wooden planks.
Total:

Ind.

400 Kgs

Ind.

400 Kgs

45/- per
kgs

18000

Ind.

850 kgs

48/- per
kgs

40800

Ind.

100 kgs

48/- per
kgs

4800

60000

Say

C.

UTILITIES:
Power 30 HP L.S.
Water
L.S.

15000
500
--------15500
----------

Total

12

221600
225000

D.

OTHER EXPENSES (PER MONTH):

Rent
15000
Postage, stationery telephone etc.
1500
Insurance
1000
Transport charges
3000
Repair & maintenance
2000
Advertisement, sales expenses etc. 500
Miscellaneous expenses
2000
--------------Total:
25000
----------------

E.

WORKING CAPITAL (PER MONTH):

Working capital

(iv)

=
=
=

TOTAL CAPITAL INVESTMENT :

Fixed Capital
Pre operative expenses
Working capital for 3 months
Total:

(v)

A+B +C +D
45000+225000+15500+25000
310500/-

Rs.
426000
Rs.
25000
Rs.
931500
--------------------Rs.
13,82,500
---------------------

FINANCIAL ANALYSIS:
1.

COST OF PRODUCTION (PER YEAR):

(a)
(b)
(c)

Total recurring cost per year

37,26,000
Dep. on machinery and equip.@ 10%
42,600
Interest on total capital investment @15% 2,07,375
----------------Total cost of production:
39,75.975

Say
2.

--------------40,00,000

SALES/TURNOVER (PER YEAR):

Item
Qty
Cost of Explosive 24
van body building
Total

Rate (Rs.)
@ 2.25 lakhs

Value (Rs.)
5400000
5400000

In addition to explosive van body building repairing work also under

taken as per availability of time & job which can be charged as per job requirement.
13

3.

NET PROFIT (per year):

Net Profit .= Sales - Cost of Production

= 54,00,000 40,00,000
= 14,00,000
4.

NET PROFIT RATIO:

Net profit
---------- x 100
Sales
14,00,000
-------------- x 100

25.92 %

5400000
5.

RATE OF RETURN:

6.

Net profit
----------------------- x 100
Total investment
14,00,000
------------------ x 100
40,00,000

35%

BREAK EVEN ANALYSIS:

Fixed cost
1
Depreciation on machinery & eqpt

42600

2
3
4
5
6

10000
2,07,375
2,16,000
74400
1,20,000

Insurance
Interest on total investment
40% of annual salary and wages
40% of utilities
40% of other contingent expenditures

Total Fixed cost

6,70,375

Fixed cost
BEP= ------------------------------(Fixed cost + Net profit)

670375
BEP= ------------------------- x 100
670375 + 1400000
BEP= 32.38%
14

x 100

9. Names And Addresses Of Machine Suppliers:

1. M/s. Essential Machine Tools Pvt. Ltd., 5, Nyaya Murti G. N. Vaidya road,
Bank Street, P.O. Box No. 2, Behind state bank fort,
Mumbai 400001.
2.

M/s. Machine Tools & Equipments, 81, Narayan Dhuru Street,

Mumbai 400003.

3.

M/s Machine Tools Traders, 25,Ganesh Chander Avenue,

Kolkata 700 013.

10. Names And Addresses Of Raw Material Suppleirs:

1.

M/s. Vinayaka Metal Industries, 283, Tawkal Lay-out, Behind Sheela

Complex, wadi, Nagpur- 440023

2.

M/s. Metals & Machinery Corporation, 130, Mahalaxmi Niwas,

Opp.Mayo Hospital, Central Avenue, Nagpur 440 018

3.

M/s. B. N. Enterprises, B-107, MIDC Indl area, Butibori,

Nagpur 441 108

15

PROJECT PROFILE
ALUMINIUM SEAL FOR LPG CYLINDER
Product Code : 335902006
Quality & Standards : Buyers Specifications
Production capacity : 1,80,00, 000 per Annum
Date of Preparation : Aug. 2011
Prepared By ; MSME Development Institute
C- Block, CGO Complex, Nagpur
Introduction
The Aluminium Seal is used in the LPG Cylinder as a security measure i.e. before delivery to
the customers. So no body can tamper with it and use the gas partly, so as to avoid customer
being cheated.

Market Potential
This type of product is required by all the manufacturers of LPG Bottles, i.e. I.O.L., HPCL.
BPCL etc. The product has got increasing and steady demand as the production of LPG
cylinders is increasing day by day.

Basis and Presumptions

The basis of calculation of production capacity is based on present local market rates on single
shift per day and efficiency at 70% of installed capacity. The cost of machinery and
equipments as indicated in this profile refer to a particular make and prices are approximate.
Working Hours 8 Hrs / Day,
Working Days 300 days / Year

Implementation Schedule
This project will take its time of 6 to 8 months from the date of approval. Break up of
activities with expected time and schedule is given below:
Sr No
1
2
3
4
5
6

Activity
Market Survey and Project scheme Preparation
Unit approvals and registration (EM II Filing )
Sanction of Loan and Disbursement
Placement of Order and Procurement of machines
Installation of machines and power connection
Trial run and Commencement of production

Period
1 Month
1 Month
2 Months
2 Months
1 Month
1 Month

Few activities can start simultaneously.

TECHNICAL ASPECTS
Process of Manufacture
Aluminium (Al) Sheets (0.2/0.3 mm or 36 SWG) of size 20" 30" cut from the continuous
coil, will be used as the raw material. The above raw material will be fed into high speed
power press for blanking and drawing. After the operation of power press, the material will be

16

processed in the knotching press for keeping gap. Finally, the trimming operation is done, for
removal of extra material and polishing, the seals are polished in the polishing barrel. The
finished Al-sheets are inspected, properly packed and despatched.

Quality Control and Standards

There is no Indian Standard Specification for this item. All the parameters are covered by
I.O.L./H.P. Specification vide Ref. No. RD 15G 214.

FINANCIAL ASPECTS
A. Fixed Capital
(i) Land and Building (Rented)
Covered Area of 600 Sq.Ft. @ 10,000 Rs per Month

(ii) Machinery and Equipments

Sr
No

Description

Qty.

High Speed Power Press-10 Ton Cap.

Motorised
Trimming Machine Motorised

Rate
(Rs.)
80000

35000

70000

Knotching Machine-Hand operated

20000

40000

Treadle Shearing Machine

80000

80000

Polishing Barrel

25000

70000

Composite Tools and Dies, Work Bench

etc.
Installation and Electrification Charge

50000

70000

Office Furniture

150000

2
3
4
5
6
7
8

Amount
(In Rs.)
320000

Total 850000
B. Working Capital (per month)
(i) Staff and Labour (per month)
Sr.
No.
1
2
3
4

Description

Nos

Amount (In Rs.)

Manager/Supervisor
Machine Operator
Skilled Worker
Helper/Peon

1
4
4
2

10000
20000
16000
6000
52000

Total
(ii) Raw Material (per month)
Raw Material
Al-Sheet 0.2 mm thick in the
form of roll.

Qty.
3000 Kg

Rate (Rs)

200 Rs / Kg

Amount (Rs)
600000

Total 600000
(iii) Other Contingent Expenses (per month)
Sr No

1
2
3

Description
Rent

Amount
10,000

Power and Water

5,000

Consumable Stores

6,000

17

4
5

Packaging, Grease, Kerosene Oil etc.

20,000

Office Expenses

10,000

Total 51,000
(iv) Total Working Capital (per month)
Sr No

1
2
3

Description
Raw Material

Amount
6,00,000

Staff and Labour

52,000

Other Contingent Expenses

51,000

Total 703000
C. Total Capital Investment
Sr No

1
2

Description
Machinery and Equipment

Amount
850000

Working Capital (for 3 months) 703000 3

2109000

Total 2959000
Financial Analysis
(1) Cost of Production (per annum)
Sr No

1
2
3

Description
Recurring Expenditure

Amount
8436000

Depreciation on M/c and office equipment @ 15%

127500

Interest on total capital investment @ 12%

355080

Total 8918580
(2) Turn-over (per year)
Sr No

1
2

Description
Sale of 180 Lac pieces of Al. seal @ Rs 0.50 each

Amount
9000000

By sale of scrap @ Rs 70 per Kg. for 6000 Kgs

600000

Total 9600000
(3) Net Profit
Net Profit = Turn over per year Cost of production per year
= 96 00 000 89 18 580
= 6 81 420 Rs

(4) Net Profit Ratio = ( Profit / Sales ) x 100

= ( 681420 / 9600000) x 100
= 7.10 %
(5) Rate of Return = (Net Profit / Total Capital Investment) x 100
= ( 681420 / 2959000) x 100
= 23.03 %

18

(6) Break-even Point

Fixed Cost
Rent
Interest
Depreciation
40% of Salary
40% of Other Contingent Expenses

Amount (In Rs.)

120000
355080
127500
249600
244800
Total

1096980

B.E.P = (Fixed Cost / (Fixed cost + Profit)) x 100

= (1096980 / (1096980 + 681420)) x 100
= 61.68 %

Addresses of Machinery Suppliers

1. M/s. Batliboi and Co.
190A, Forbes Street,
Fort, Mumbai-1.
2. M/s. H.P. Singh
75, Ganesh Ch. Avenue,
Kolkata13.
3. M/s. Oriental Machinery Works
23, R.N. Mukherjee Road,
Kolkata-13.

19