DKS INDUSTRIES LIMITED

Mfrs : MS BILLETS
Proposed Factory site: PongalurVillage, Pongalur (TK)
Coimbatore.

DKS INDUSTRIES LIMITED

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CONTENTS Page No.

Project at a Glance 1
Introduction 2
Need and Importance of the Project 2
Strength 5
Promoters 5
Product Particulars 6
Market 6
Project Particulars 6
-Source of Technology 6
-Production Capacity 7
-Land & Building 7
-Plant &Machinery 7
-Electrification 7
-Office Equipment 7
-Pre-Operative Expenses 7
-Working Capital Margin 7
-Contingencies 8

Production & Input Requirements 8

-Process of Production 8
-Process Flow Chart 9
-Raw Materials & Consumables 10
-Utilities 10
-Manpower 11
-Management 11

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Pollution/Effluents 11

Cost of Project& Means of Finance 12

-Cost of Project 12
-Schedule of Implementation 12
-Preliminary & Pre-Operative Expenses 12
-Deposit with Various Authorities 13
-Margin Money for Working Capital 13
-Means of Finance 13

Financial Feasibility 13

-Cost of Production and Profitability 13

-Break Even Analysis 13
-Cash Flow 14
-Balance Sheet 14
-Coverage Ratios 14
-Projected Profitability Statement 14
Future Plans – Forward & Backward Development 14

DKS INDUSTRIES LIMITED

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 ANNEXURES Page
No.

III Demand Projection 15

IV Land & Building 15
V Plant &Machinery 16
VI Office Equipments 17
VII Working Capital Margin 17
VIII Working Capital Requirements 17
IX Utilities - Electricity 17
X Utilities - Water 18
XI Manpower Requirements 19
XII Schedule of Implementation 19
XXIII Assumptions 20

PROJECT AT A GLANCE
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 Cost of Project and Means of Finance
Project Cost
Particulars (Rs. In Lakhs)
Promoters contribution – Fixed Asset 214
Promoters contribution – Working Capital 100
Bank Finance – Fixed Asset 150
Bank Finance – Working Capital 50
Total 514

MS Billets:

DKS Industries Limited is proposing to set up a manufacturing facility to

manufacture Mild Steel Billets in Pongalur Village, Pongalur (TK), Coimbatore. The
steel billets are inputs for steel rolling and extrusion industry. Being the fastest
growing economy in the world right now, the demand for steel is likely to go up
exponentially in India. DKS Industries Limited looks to become a major player in
the manufacturing of steel billets in Southern India. The estimates for the proposed
MS Billet manufacturing plant of DKS Industries Limited are as under:

Product MS Billet
Installed Capacity 31100 MT.
Capacity Utilisation1stYear 70%
2nd Year 80%
3rdYear onwards 90%
No. of working days 350
No. of Shifts per 3
day
Power Required 4000 KVA

Rs.
Projected Capital Investment
(in Lakhs)
Fixed Capital (Excluding Working Capital) 364
Working Capital Requirement 150
Total 514

Rs.
Proposed Means of Finance
(in Lakhs)
Promoters Contribution 314
Bank Finance 200
Total 514

1.00 INTRODUCTION
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With the liberalisation of the Indian Economy and the on-going process of decontrol
and opening up of the economy to the private sector including the multinationals,
India is on the threshold of a major economic revolution. Another encouraging trend is
the interest shown by the multinationals in the development of the infrastructural
sector especially in power sector. The Government has given an open invitation to the
private sector to invest in the infrastructural sector like power, transport and
communication under the “Build, Operate and Transfer Scheme” under which the
private sector can build roads, bridges, etc., operate them for a certain period to
recover their cost at a reasonable profit and transfer it to the Government.

This welcome step of the Government has given the Construction Industry a vast
scope to expand and develop. This in turn will see a quantum jump in the demand for
steel and cement, the two most important building materials for civil construction.
Against a world average per capita finished steel consumption of 208 Kg. of steel in
the year 2016 and the per capital consumption of 400-700 Kg of steel developed
countries the per capital consumption in India is only 63 Kg.

The local Steel Industries will have to expand considerably to meet the increasing
demand for steel products. Realising this facts and considering the prospects for steel
industry in the country, the promoters of “DKS INDUSTRIES LIMITED” envisages
a good future and is setting up a plant with an installed capacity of 36,000 MT Per
Annum.

Brief description and nature of the project:

The proposed project deals with manufacturing of Mild Steel Billets. Steel Billets are
widely used in civil construction and structural steel manufacturing.

Need and Importance of the project:

MS Billets:

Steel is the most important product for any industrial nation. From civil construction,
industrial machinery to consumer products, steel finds a wide variety of applications.
It is also an industry with diverse technologies based on the nature and extent of use of
raw materials

India was the world’s third-largest steel producer in 2016. The growth in the Indian
steel sector has been driven by domestic availability of raw materials such as iron ore
and cost-effective labour. Consequently, the steel sector has been a major contributor
to India’s manufacturing output. The Indian steel industry is very modern with state-
of-the-art steel mills. It has always strived for continuous modernisation and up-
gradation of older plants and higher energy efficiency levels.

6
The Indian Government envisages the growth of steel sector to attain a production
capacity of 300 Million Tonnes by 2025-30. To achieve this capacity it is essential to
create the facilities based on local resources to produce steel. The Government is also
keen in the development of infrastructure in India and has plans for having bullets
trains and metro trains in the Railways. These plans do require a large amount of steel
and this creates the additional demand for the product.

The Hon’able Prime Minister of India, Sri. Narendra Modi, has announced the
Pradhan Mantri Awas Yojana (PMAY) Scheme with a vision to provide home for all
people in India. The PMAY scheme is introduced to encourage the homeless to avail
home loan for house construction by providing interest subsidy from the Central
Government. The Central Government’s vision is to provide housing for all by the
year 2022.

The ministry of rural development has fixed the deadline for constructing the 44 lakh
houses by the end of 2017. However, only about 41,000 houses have been built till
end-March 2017, out of the approved 16.3 lakh houses under the scheme by the
Centre. [Source: Financial Express news article dated 31st May 2017]

Demand-Supply Gap:

The Scenario of Steel Industry is clearly looking upward and the extracts from latest
data on Steel Industry are as follow:-

AN OVERVIEW OF STEEL SECTOR-

(Source: Ministry of Steel, Government of India)

Global Scenario
 In 2016, the world crude steel production reached 1630 million tonnes
(mt) and showed a growth of 0.6% over 2015.
 China remained world’s largest crude steel producer in 2016 (808 mt)
followed by Japan (105 mt), India (96 mt) and the USA (79 mt).
 World Steel Association has projected Indian steel demand to grow by
6.1% in 2017 and by 7.1% in 2018 while globally, steel demand has
been projected to grow by 1.3% in 2017 and by 0.9% in 2018. Chinese
steel use is projected to show nil growth in 2017 and decline by 2% in
2018.
 Per capita finished steel consumption in 2016 is placed at 208 kg for
world and 493 kg for China by World Steel Association.
Domestic Scenario
 The Indian steel industry has entered into a new development stage,
post de-regulation, riding high on the resurgent economy and rising
demand for steel.
 Rapid rise in production has resulted in India becoming the 3rd largest
producer of crude steel in 2015 as well as in 2016. The country was the
largest producer of sponge iron or DRI in the world during the period
2003-2015 and emerged as the 2nd largest global producer of DRI in
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 2016 (after Iran). India is also the 3rd largest finished steel consumer in
the world and maintained this status in 2016. Such rankings are based
on provisional data released by the World Steel Association for the
above year.
 In a de-regulated, liberalized economic/market scenario in India the
Government’s role is that of a facilitator which lays down the policy
guidelines and establishes the institutional mechanism / structure for
creating conducive environment for improving efficiency and
performance of the steel sector.
 In this role, the Government has released the National Steel Policy
2017, which has laid down the broad roadmap for encouraging long
term growth for the Indian steel industry, both on demand and supply
sides, by 2030-31.
 The Government has also announced a policy for providing preference
to domestically manufactured Iron & Steel products in Government
procurement. This policy seeks to accomplish PM’s vision of ‘Make in
India’ with objective of nation building and encourage domestic
manufacturing and is applicable on all government tenders where price
bid is yet to be opened. Further, the Policy provides a minimum value
addition of 15% in notified steel products which are covered under
preferential procurement. In order to provide flexibility, Ministry of
Steel may review specified steel products and the minimum value
addition criterion.

Opportunities for growth of Iron and Steel in Private Sector

The New Industrial Policy Regime

The New Industrial policy opened up the Indian iron and steel industry for private
investment by (a) removing it from the list of industries reserved for public sector and
(b) exempting it from compulsory licensing. Imports of foreign technology as well as
foreign direct investment are now freely permitted up to certain limits under an
automatic route. Ministry of Steel plays the role of a facilitator, providing broad
directions and assistance to new and existing steel plants, in the liberalized scenario.

Thus India is expected to become the second largest steel producer in the world by
2018, based on increased capacity addition in anticipation of upcoming demand, and
the new steel policy that has been approved by the Union Cabinet in May 2017 is
expected to boost India's steel production. Huge scope for growth is offered by India’s
comparatively low per capita steel consumption and the expected rise in consumption
due to increased infrastructure construction and the thriving automobile and railways
sectors.

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STRENGTHS OF DKS INDUSTRIES LIMITED

Steel Billets:

i. Experienced promoters with more than 12 years track record in steel industry.
ii. The company has access to sources of raw material as they are already in the
business for a long period.
iii. The end product has very good niche market. There is very little competition
for the MS steel billets both from local and international suppliers and hence
have a ready market.
iv. The gestation period for setting up the manufacturing facility is nine months.
The company expects to commence Commercial production in nine months’
time.
v. All infrastructural facilities like power, roads etc., are available at the factory
site.
vi. There is high demand for the product in relation to the available sources of
supply. This will ensure steady market for the company’s products. MS Billets
commands a 2% higher price compared to MS Ingots.
vii. The company has a long standing good relationship with many Steel Rolling
Mills. The company does not foresee any difficulty in marketing its entire
production at 100% capacity.

1.01 PROMOTERS

The following are the Promoters & Directors of the company.

1. Mr. N. Murali Raj Managing Director

2. Mrs Anitha Murali Raj Director
3. Mrs M. Keerthanadevi Director

1. Mr. N. Murali Raj

Mr. N. Murali Raj, aged about 32 years, is the Managing Director of the
company. He has done his masters in Computer application and Business
administration. He is in the business for the last 8 years and has in-depth
knowledge in steel industry.

2. Mrs M. Keerthanadevi

Mrs M. Keerthanadevi aged about 31 years, has a vast experience in steel

industry. She is in the Iron and Steel trading business for the past 10 years. Her
experience in the industry will be of immense value in procuring raw materials
required for the plant.

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 3. Mrs Anitha Murali Raj. MBBS

Mrs Anitha Murali Raj, aged about 26years, is a physician by profession and is
sure to add value to the company by bringing in her wealth of experience.

2.00 PRODUCT PARTICULARS

Steel Billets:

Iron & Steel rods, TMT bars, flats, channels and other sections find wide
application in civil construction, engineering fabrication, furniture
manufacture and a host of the other applications. These rods and sections are
made of Steel Ingots and Steel Billets.

DKS INDUSTRIES LIMITED will be manufacturing about 21770 tons of

MS Billets in the first year of operations.

3.00 MARKET

As mentioned in the introduction, the construction industry is poised to take a

big leap ahead. The construction of Infrastructural like roads, bridges,
telecommunications networks, power plants and industrial units, housing
sector are going to expand considerably. As steel and cement are two essential
construction materials, the demand for these two products is going to increase
considerably. The market for Iron & Steel Products is very bright.

4.00 PROJECT PARTICULARS

4.01 Source of Technology

The state of the art technology, Induction Furnace and Continuous Casting
Machine (CCM) is proposed to be used for conversion of iron scraps in to MS
Billets. Various grades of scrap as super melting scrap, bazaar melting scrap,
commercial scrap and additives like Ferro silicon, Ferro manganese, aluminium
ingots etc., are added. They are introduced in to a Medium Frequency
Induction Furnace where they are heated to about 1700 degree C and the
molten metal is poured in an open-ended mould. From the mould the molten
metal is casted in Continuous Casting Machine (CCM) to produce the finished
product MS Billet of 20 ft and 40 ft in length and size 100mm Sq, 110mm Sq,
120 mm Sq, and 130mm Sq. as per the requirements of customer.

4.02 Production Capacity

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 The unit will be equipped with the 3500Kw/500 Hz Furnace with a rated
capacity of 8 tons and continuous casting machine - single strand. The installed
capacity will be 31100 Metric tons per year. The unit will work at 70%
capacity in the first year and will increase to 80% in the second year and
stabilise at 90% capacity utilisation from the third year onwards.

4.03 Land & Buildings

The promoters have 1.50 acres of land for the project. The estimated cost of
Land and land development is Rs.20,00,000/-. Factory shed, furnace room,
transformer room, other Civil work, Water tank, compound wall and fencing
and other buildings such as office building, Laboratory, Labour quarters,
security room etc., have to be built in the premises.

The detailed plan and estimates are enclosed in Annexure IV.

4.04 Plant & Machinery

The unit will be equipped with the necessary plant and machinery such as
Medium Frequency Induction Furnace, Continuous Casting Machine (CCM),
Cooling Towers, Material Handling Equipments, Pollution Control
Equipments, Laboratory Equipments, Water Treatment Plant etc., including
transportation, erection, Spares etc., is detailed in Annexure - V.

4.05 Electrification.

Electrical energy is an essential input for this project. The investment in

electrical equipment will be heavy. High Tension Power supply will be
obtained from TNEB. The details of electrical equipment are mentioned in
Annexure - IX.

4.06 Pre-Operative Expenses

For the implementation of the project is expected to take about 12 month time.
The pre-operative expenses expected to be incurred for the project are detailed
in para 6.03 on a realistic basis.

4.07 Working Capital Margin

The production will be operational 24/7 and will operate three shifts a day. The
working capital requirements has been estimated on a realistic basis and
detailed in Annexure VII.

4.08 Contingencies

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 The implementation of the project will start immediately and will be completed
within 12 months. The Company expects to implement the project in time
within budgeted costs and avoid cost escalation. The Company have tied up
with machinery suppliers for supply of Plant and Machinery and we don’t
expect any cost escalations in this regard. All provision for contingencies is
included in project cost.

5.00 PRODUCTION & INPUT REQUIREMENTS

5.01 Process of Production

Various types of iron scrap are put into the furnace and the scrap is melted in
the Medium Frequency Induction Furnace. Virgin form of Iron – Sponge Iron
and various types of scrap that are normally used for a melt are:

a) Super Melting Scrap

b) Bazaar Melting Scrap
c) Sponge Iron
d) Commercial Scrap
e) Mild Steel Turnings & Borings
f) HP. Bundle A+B grade

When the scrap is melted into fluid, certain additives are added to achieve
quality parameters,

a. Ferro Manganese is added to strengthen the fluid @ 1.0 Kg/Ton.

b. Ferro Silicon to achieve the metal fluidity 10 Kg/Ton.
c. Aluminium ingots to reduce the carbon contents @ 0.5 Kg/Ton.

The above chemical will be added at various intervals of time. Accurate temperature
and compositional control is ensured with this melting system. The melting process
will be carried out within two hours.

Quality Test

Before the molten metal is casted as MS Billet, they will be tested for their
chemical composition. After casting, MS Billets will be cut as per customer
requirement.

Casting

At 1700 degree C. the molten metal will be poured into moulds. The metal will
be casted in the CCM machine up to 40 ft length, in the strands immediately.
After they are cooled to a certain level, the Billet is taken from the casting
runners and moved to dispatch yard.

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 PROCESS FLOW CHART
Raw Materials
Super Melting Scrap
+
Bazaar Melting Scrap
+
Sponge Iron
+
Commercial Scrap
+
Mild Steel Turnings &Bcnings
+
HP. Bundle A+B Grade

Charging in Furnace

Furnace Heating to 1700 degree C

Chemical Process

FeffoSilicon/FelToManganese/Aluminium added

Quality Testing

Casting in CCM

Finished Goods (MS Billet)

Sales

5.02 Raw-Materials & Consumables

The main raw-material required for the manufacture of the MS Billet is Sponge
Iron and Iron scrap. Various grades of scrap such as super melting scrap, mild
scrap, MS turnings & Borings, Commercial Scrap and Bundle A+ B grade
scrap are mixed and fed in to the furnace.

Apart from the availability of scrap in domestic market, Industrial Scraps will
also be available in large quantities. With the liberalisation of the economy and
free convertibility of the rupee, scrap metal is also being imported in India at
cheaper cost and in good quality in huge volume. So the unit is assured of
sufficient quantities of raw-materials to operate smoothly without interruption.

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Consumables

The unit requires additives, refractory and casting materials. Additives are
added and the chemical process is to give strength, flow, etc., to the molten
metal. Refractory and lining materials, ramming mass, for new lining and
patching, runner etc., are required to be changed for every 300 heats. The
details are given in Annexure- VIII.

5.03 Utilities

Electricity

Electricity is a major input required for the manufacture of steel Billets. The
unit will require a connected load of 4000 KVA and the maximum demand will
be 3800 KVA. A 55-33 KV/433 volts outdoor copper wound transformer will
be installed to supply this load. The monthly energy consumption is estimated
at 13.15 lakhs units in the first year. Annual power charges based on current
tariff of TNEB is worked out in Annexure IX.

Water

Being an alloy industry, water is required for cooling purposes. Water is

required for cooling the furnace, inverter and capacitor, cooling of moulds etc.,
the estimated requirement of water per day is about 15,000 litters. This will be
sourced through ground water and water recycling process would be carried on
with necessary equipments.

5.04 Manpower

A list of essential manpower required for the smooth operation of the unit and
their annual remuneration is furnished in Annexure XL.

5.05 Management

DKS INDUSTRIES LIMITED will be managed by the Managing Director

Shri. N.MuraliRaj, The organisation structure is given as follows,

Board of Directors

Managing Director

Directors
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 CEO

Production Manager General Manager

Production Shift in-charge (2) Administration Officer

(Purchase, Sales, Accounts, etc.,)

Workers Assistants
(Skilled & Unskilled)

5.06 Pollution/Effluents

Pollution control system will be installed following with compliances of

Tamilnadu Pollution Control Board (TNPCB). The unit will not generate any
harmful effluents or create environmental pollution. The water used for cooling
purposes can be reused and there will only small percentages of loss due to
evaporation which has to be replaced.

6.00 Cost of Project & Means of Finance

6.01 Cost of Project

The cost of project is Rs. 514 Lakhs as detailed below:

S. Rs.
PARTICULRS
No (in Lakhs)
1 Land 15.00
2 Land Development 5.00
3 Building and Civil work 180.00
4 Structural steel Shed and Plant & Machinery 100.00
5 Office Equipment/Furniture 4.00
6 Preliminary Pre-Operative Expenses 10.00
7 EB and Other Deposit & Lining charges 50.00
Total 364.00
8 Working Capital 150.00
Total Cost of Project 514.00

6.02 Schedule of Implementation

A brief list of activities from the stage of preparation of project report to the
stage of commercial production with the approximate time for each stage is
furnished in Annexure XII. Accordingly the unit will start commercial
production from the 9th month onwards.

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6.03 Preliminary & Pre-Operative Expenses

Administration expenses, staff salaries, legal expenses, documentation charges,

professional charges, travelling expenses, postage & telephone, marketing
expenses etc., during the implementation and pre-operative period is estimated
at Rs.10 Lakhs.

6.04 Deposit with various authorities

Particulars Amount
(Rs. In Lakhs)
TNEB for power connection 48
Telephone Deposit 0.25
Miscellaneous & Bank Deposits 1.75
Total 50.00

6.05 Margin Money for Working Capital

The working capital requirement of the unit is given in Annexure VU. It is

expected that out of the total requirement of Rs. 150 lakhs

6.06 Means of Finance

The total project cost of Rs.514/- lakhs will be financed as follows:

Particulars Amount
(Rs. In Lakhs)
Promoters contribution Fixed capital 214
Promoters contribution Working capital 100
Bank Finance – Term Loan 150
Bank Finance – CC 50
Total 514

7.00 Financial Feasibility

7.01 Cost of Production & Profitability

A detailed projected profitability statement, for five years is given in annexure

XVII. The statement has been prepared on the following assumptions.

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 1. The sale price is estimated at Rs. 32,000/- PMT. Excluding 18% GST. The
selling prices will vary with change in raw-material prices which has not
been considered here.
2. The unit will work for 350 days a year on three shifts basis.
3. The unit will work at 70% capacity in the first year, at 80% capacity in the
second and at 90% capacity in the third year.
4. Provision for employees benefit at 20% for wages and salaries and for
annual increase at 10 to 15% is made.
5. Cost of repair and maintenance of assets is taken as 0.78% and insurance
cost at 2.70% of an assets including current assets.
6. Depreciation is charged as per schedule XIV of the companies act and
adjusted at the rates appropriate under the Income-Tax Act for Income-
Tax purposes.

7.02 Break Even Analysis

Break even analysis has been carried out and the details working is given as
Annexure -XXI.

7.03 Cash Flow

Five years cash flow statement is attached as Annexure - XVIII.

7.04 Balance Sheet

Projected profitability statement and balance sheet for Five years is enclosed as
Annexure - XIX.

7.05 Coverage Ratios

Coverage Ratios have been calculated in Annexure- XX.

7.06 Projected Profitability Statement

Please refer annexure XVII for detailed profitability statement.

8.00 Future Plans

(i) TMT Bars - Direct Rolling:

The Promoters of DKS Industries Limited has scope for setting up a

downstream Direct Rolling of MS Billets whereby the finished goods
will be TMT bars.

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 Usually the MS Billets would be sent to the Rolling Mill for rolling once
it is cooled. The cooled Billets are then reheated by placing them into
Billet Reheating Furnace where the Billet is heated up to 1200 degree
Celsius, then these are discharged and taken for rolling. This process
consumes a lot of fuel in reheating furnace and causes burning loss of
around 1.5 -3.5% depending on the type of fuel used.

However, the Direct Rolling method is one of a kind where the MS

Billet be sent to the rolling mill directly before its cooled down thus
saving handling and energy costs. By using this method, the pre-heating
cost of 3% will be reduced and it also saves on wastage.

The savings in cost of production and wastage will ensure increased

profitability of the company.

(ii) Sponge Iron DRI manufacturing:

The Promoters are also planning to have an upstream facility to

manufacture Sponge Iron DRI manufacturing plant, which is the raw
material for producing MS Billets. This Sponge Iron would be
consumed in-house for manufacture of MS Billets. This investment will
ensure substantial savings in cost of raw material purchase.

(iii) Windmill/ Thermal power plant:

For manufacturing MS Billets, electricity for melting the sponge iron

and Iron scrap is the major cost. MS Billet project would consume Rs.13
crore worth electricity per annum. To reduce the cost on power
consumption, a windmill would be set up for captive power
consumption. There is scope for setting up of thermal power plant in
Sponge Iron plant, utilising the excess heat produced during melting will
reduce the cost of power generation.

There is immense potential for making profitable investments in upstream,

downstream and ancillary units along with MS Steel Billets manufacturing unit.

ANNEXURE - III

Annual Demand of MS Billets for Re-rolling Mills Located in Tamil Nadu &
Kerala.

S.N Potential Customers IN Metric

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 o Tonnes
1 Beepath Castings P Ltd, Palakkad 90000
2 Indrolla Steels P Ltd 30000
3 Sastha Steel P Ltd 30000
4 Palakkad Steels Pvt.Ltd., Palakkad 50000
5 Kairali Steels P Ltd 90000
6 Cheran Steel Rolling Mills 20000
7 Kannappan Iron and Steel company P Ltd(KISCOL) 90000
8 Gazha Steels P Ltd 60000
9 METCON TMT 30000
10 Paragon Steels P Ltd 60000
11 Thirumala Steels P Ltd 90000

ANNEXURE V : Plant & Machinery

–

Amount
S. No. Particulars Rs. In Lakhs
A Furnace Shed 50 feet X 112 feet x 33 feet 49.50
B Plant and Machinery
1 Induction Furnace 3.5mw/8ton HV
2 HT Cable
3 Busduct from Transformer to panel
4 33kV VCB Assembly with Group control (3nos)
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5 LT Panel for cooling pumps and wiring kit
6 LT Cables assorted for complete plant
7 Motor Control Centre
8 Cable Tray and Conduits
9 Harmonic Filter
10 Furnace Transformer(4600 kva)X1
11 Auxillary Transformer(1000kva)
12 ELECTRICAL SUB STATION
WATER COOLING SYSTEM
13 COOLING TOWER x1
14 Cooling Pumps
15 PLATE TYPE HEAT EXCHANGER
16 PUMPS AND PIPE LINES AND FITTINGS
17 SOFTENING PLANT / RO PLANT/ DM Plant
MATERIAL HANDLING EQUIPMENT
18 CHARGING LADELS
19 EOT Crane 7 Ton Capacity
20 COMPRESSOR, Bundling and plate rolling machine
22 Slag box charging bucket
23 POLLUTION SYSTEM
TOTAL 49.50
CONTINUOUS CASTING MACHINE  
24 CONCAST 4/7 Radius single Stand 20
25 LADLE 10T Capacity x 1Nos 3
26 CHEMICAL LAB   3
27 SLAG POT - 3 nos   4 0.50 2
28 MAN COOLER FANS   No's 20 0.10 2
29 SPECTROMETER   No's 1 5.00 5
30 LADDLE PREHEATER   No's 1 2.00 2
31 SLIDE GATE   No's 2 1.00 2
33 Tools & Tackles 1.50
34 Plant Lightning, Earthing & Security System 3
36 Spare for Induction Furnace & CCM 1
38 Installation and Erection Charges 6
Total 100

ANNEXURE - VI

Office Equipments

Amount
Equipment
(Rs. In Lakhs)
Furniture and Fittings 2
Office Equipment 2
Total 4

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 ANNEXURE- VII

Calculation of Working Capital Margin for Steel Billets

Particulars Total (Rs) in lakhs

Raw Materials 7 days 94.12
Consumables 7 days 5.00
Book Debts – 2 days 39.80
One month fixed expenses 11.08
Working Capital 150.00

ANNEXURE –IX

Electricity Requirements Based on Installed Capacity

Induction Furnace 3250 KVA
Billet CCM 500 KVA
Water System 25 KVA
Laboratory 5 KVA
Workshop 5 KVA
Lighting Office, Shed &
15 KVA
Boundary
Reserve power load 200 KVA
Total 4000 KVA

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Considering CPF of 0.95 for Induction Furnace and 0.85 for Auxiliary Equipment the
KVA requirements for these loads will be 4500KVA.

S. No Particulars
1 Estimated Energy Consumption:
70% Capacity 158 Lakhs Unit/year
80% Capacity 180 Lakhs Unit/year
90% Capacity 203 Lakhs Unit/year
2 Fixed Charges per KVA Rs. 330.00 Rs.13,20,000 p/m or
Rs.1,58,40,000 p/a
3 Energy Charges per Unit (inclusive of Rs.6.35
duty)
4 Annual Power Charges - 70% Capacity Rs.11,60,64,000

(total charges/unit Rs.6.35+MD)

5 Monthly Power Bill Rs.96,72,000

ANNEXURE - X

Water is required for cooling of the Induction Furnace, the control panels and the
current carrying cables. But the entire cooling water circuit flows in a closed loop
involving a cooling tower and a pump, there by restricting the water requirement to
one time initial requirement of approximately 15,000 ltrs. An evaporation of 2% water
needs to be replenished on an on-going basis. Hence the total requirement for both for
consumption in cooling circuit as well domestic consumption would be around 15,000
litres per day.

We propose to arrange for ground water recharge and harvesting. The units total daily
water consumption will be below 15,000 Litres/day.

22
 ANNEXURE - XI
Manpower Requirements

No. of
Category Monthly Salary (Rs.) Salary (Rs.)
Persons
Directors 15000 2 30000
Manager (Production & Office) 15000 2 30000
Accounts Officer 12000 1 12000
Engineering Staff 12000 2 24000
Shift in Charge 9000 2 18000
Admin Staff 8000 1 8000
Store Keeper 7000 2 14000
Time Keeper &Security 7000 5 35000
Office Assistants 7000 2 14000
Office Boy 6000 1 6000
Skilled Workers 12
Contract workers Per ton Rs.400
60
Unskilled Workers

Add: 10% for employee benefits

Total 93 191000

ANNEXURE XII -

Schedule of Implementation for Steel Billets

1 Acquisition of land Ready Available

2 Civil Construction Feb 2018 to June 2018

3 Placement of orders for Machinery Feb 2018

4 Delivery at Site June 2018 to September 2018

5 Arrangement for Power March 2018 to September 2018

6 Arrangement for Water Feb 2018

7 Erection of Equipment June 2018 to September 2018

8 Procurement of Raw materials, - December 2018

selection of key personnel

9 Commissioning of Plant and Trail Prdn. December 2018

10 Commercial Production December 2018

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 ANNEXVRE XXIII -

ASSUMPTION FOR STEEL BILLETS

1 Installed Capacity 31100 MT per/annum

8 Ton Induction Furnace & CCM 1No.

1st Year 2nd Year 3rd Year 4th Year 5th year
70% 80% 90% 90% 90%
2. Projected Production (in MT) 21770 24880 28000 28000 28000
3. Quantity of Scrap Consumed (in MT) 23664 27045 30436 30436 30436
4. Average Selling Price MS Billet PMT (Rs)32000 32000 32000 32000 32000
5. Average Purchase Price M.S.Scrap PMT 21000 21000 21000 21000 21000
(Rs)
6. Power Minimum Demand per KVA Rs. 350 * 90% load of 4500 KVA/-*
Unit Consumption per annum 70% 158 Lakhs Units
80% 180 Lakhs Units
90% 203 lakhs Units

1. Selling price for projection is adopted for all periods uniformly based on the present
market rates for MS Billets. As this is variable compared to raw material and other
variables cost, the same price is adopted for working out profitability statement and
for other purpose.

8. GST is worked out at 18%

9. Depreciation is worked out for book purpose under S.L.M. basis as provided under
the Companies Act and for Income-tax under W.D.V. method as per Income-tax Act,
at the prescribed rates under respective schedule.

10. Working capital assessment is worked out under CMA format.

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